Western District of North Carolina

STATESVILLE, N.C. – A federal jury sitting in Statesville has convicted David Alexander Moralez, Jr., 37, of Fresno, California, of conspiracy to possess with intent to distribute methamphetamine, two counts of distribution of methamphetamine, and money laundering conspiracy following a three-day trial, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.

According to filed court documents and evidence presented at trial, Moralez worked at a shipping company in California as a mail clerk. As trial evidence established, from 2018 to September 2019, Moralez was involved in a conspiracy to traffic narcotics from California to the East Coast. The evidence at trial demonstrated that Moralez conspired with other drug traffickers to send numerous parcels – each filled with multiple pounds of methamphetamine – via the U.S. Postal Service and FedEx from Fresno, California, to various locations throughout North Carolina, South Carolina, and Tennessee.  According to evidence presented at trial, on December 18 and 19, 2018, law enforcement in Newton, N.C. and Hickory, N.C., seized two pounds of methamphetamine during controlled buys. In addition to trafficking narcotics, co-conspirators on the East Coast sent drug proceeds back to California via Walmart-to-Walmart transfers and bank deposits, to pay for, among other things, Moralez’s fees and expenses.

Moralez was ordered detained pending sentencing, at which time he faces 10 years to life in prison for the drug trafficking conspiracy and each of the distribution charges, and up to 20 years in prison for the money laundering conspiracy charge. A sentencing date has not been set.

Moralez was convicted as part of an ongoing Organized Crime Drug Enforcement Task Force (OCDETF) investigation codenamed “Dixie Crystal.”  According to court documents, since 2015, more than 200 individuals have been prosecuted and law enforcement has seized far in excess of 20 kilograms of crystal methamphetamine, $1,000,000 in U.S. currency and other assets, and dozens of firearms.  OCDETF is a joint federal, state and local cooperative approach to combat drug trafficking and is the nation’s primary tool for disrupting and dismantling major drug trafficking organizations, targeting national and regional drug trafficking organizations and coordinating the necessary law enforcement entities and resources to disrupt or dismantle the targeted criminal organization and seize their assets.

In making today’s announcement U.S. Attorney Murray thanked the following agencies for their investigative efforts which led to the prosecution of this case: ICE’s Homeland Security Investigations (HSI) in Charlotte; HSI in Greenville and Nashville; the Drug Enforcement Administration’s Charlotte Field Office; the U.S. Postal Inspection Service in Charlotte; the North Carolina State Bureau of Investigation; the Alexander County Sheriff’s Office; the Boone Police Department; the Burke County Sheriff’s Office; the Caldwell County Sheriff’s Office; the Catawba County Sheriff’s Office; the Charlotte Mecklenburg Police Department; the Davie County Sheriff’s Office; the Gaston County Police Department; the Gastonia Police Department; the Huntersville Police Department; the Lincoln County Sheriff’s Office; the Hickory Police Department; the Johnson County, Tennessee Sheriff’s Office; the Mooresville Police Department; the Newton Police Department; the Longview Police Department; the Morganton Department of Public Safety; the Rutherford County, Tennessee Sheriff’s Office; and the Troutman Police Department.

Assistant U.S. Attorney Steven R. Kaufman, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.           

CHARLOTTE, N.C. – Glenda Taylor-Sanders, 52, of Matthews, N.C. was sentenced to 66 months in prison in federal court today by U.S. District Judge Robert J. Conrad Jr., for orchestrating a $400,000 fraudulent loan scheme involving insurance premiums, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.

Robert R. Wells, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, and Tommy D. Coke, Inspector in Charge of the Atlanta Division of the U.S. Postal Inspection Service, which oversees Charlotte, join U.S. Attorney Murray in making today’s announcement.

According to plea documents and today’s court hearing, Taylor-Sanders was a licensed Insurance Producer and Insurance Broker, and the owner of G. Taylor, Inc., an insurance agency in Charlotte that procured insurance policies for customers, including transportation companies.  Court records show that in February 2018, Taylor-Sanders voluntarily surrendered all of her licenses issued to her by the North Carolina Department of Insurance (NCDOI) and acknowledged that she could no longer perform any activities for which a license from NCDOI is required. 

According to court records, from February 2017 through May 2019, Taylor-Sanders defrauded an Illinois-based financial services company that provides companies with loans to pay for insurance premiums. Taylor-Sanders executed the scheme by submitting fraudulent applications and related forged documents to the financial services company, purporting to be on behalf of her transportation company clients, for the purpose of obtaining loans to cover their insurance premiums. According to court records, once the financial services company received the forged documents and approved the loans, the financial services company wired the loan proceeds to a bank account controlled by Taylor-Sanders. Court documents show that, over the course of the scheme, the financial services company wired to Taylor-Sanders more than $400,000 in fraudulently obtained loan proceeds, which the defendant used to pay for personal expenses and to further the fraud scheme. 

According to court records, after some of the transportation companies began to receive communications from the financial services company about missed payment deadlines, Taylor-Sanders went to great lengths to conceal the fraud, and continued to make false representations, including instructing the financial services company to only contact her, and assuring the impacted transportation companies that the issue had been resolved.

According to court records, Taylor-Sanders used the fraudulently obtained funds to make mortgage payments on her personal residence, loan payments for a Maserati and a Mercedes Benz, to purchase Carolina Panthers tickets, and to pay for groceries and meals at restaurants. 

In making today’s announcement, U.S. Attorney Murray commended the FBI and USPIS for handling the investigation and thanked NCDOI for their invaluable assistance.

Assistant U.S. Attorneys Caryn Finley and William Bozin, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.

CHARLOTTE, N.C. – United States Attorney Andrew Murray announced today that Assistant United States Attorneys (AUSAs) Michael Savage in Charlotte, and Richard Edwards in Asheville, will lead the efforts of their Office in connection with the Justice Department’s nationwide Election Day Program for the upcoming November 3, 2020, general election. 

AUSAs Savage and Edwards have been appointed to serve as the District Election Officers (DEOs) for the Western of North Carolina, and in that capacity they are responsible for overseeing the District’s handling of complaints of election fraud and voting rights concerns in consultation with Justice Department Headquarters in Washington.

U.S. Attorney Murray said, “Every citizen must be able to vote without interference or discrimination and to have that vote counted without it being stolen because of fraud.  The Department of Justice will always act appropriately to protect the integrity of the election process.”

The Department of Justice has an important role in deterring election fraud and discrimination at the polls, and combating these violations whenever and wherever they occur.  The Department’s long-standing Election Day Program furthers these goals, and also seeks to ensure public confidence in the integrity of the election process by providing local points of contact within the Department for the public to report possible election fraud and voting rights violations while the polls are open through election day.

Federal law protects against such crimes as intimidating or bribing voters, buying and selling votes, impersonating voters, altering vote tallies, stuffing ballot boxes, and marking ballots for voters against their wishes or without their input.  It also contains special protections for the rights of voters, and provides that they can vote free from acts that intimidate or harass them.  For example, actions of persons designed to interrupt or intimidate voters at polling places by questioning or challenging them, or by photographing or videotaping them, under the pretext that these are actions to uncover illegal voting may violate federal voting rights law.  Further, federal law protects the right of voters to mark their own ballot or to be assisted by a person of their choice (where voters need assistance because of disability or illiteracy).

The franchise is the cornerstone of American democracy.  We all must ensure that those who are entitled to the franchise exercise it if they choose, and that those who seek to corrupt it are brought to justice.  In order to respond to complaints of election fraud or voting rights concerns during the voting period that ends on November 3, 2020, and to ensure that such complaints are directed to the appropriate authorities, United States Attorney Murray stated that AUSAs/DEOs Savage and Edwards will be on duty in this District while the polls are open. They can be reached by the public at the following telephone numbers: 

In Charlotte: 704-344-6222, and in Asheville: 828-271-4661.

In addition, the FBI will have special agents available in each field office and resident agency throughout the country to receive allegations of election fraud and other election abuses on election day. The local FBI field office can be reached by the public at 704-672-6100.

Complaints about possible violations of the federal voting rights laws can be made directly to the Civil Rights Division in Washington, DC by phone at 800-253-3931 or by complaint form at https://civilrights.justice.gov/.

Please note, however, in the case of a crime of violence or intimidation, please call 911 immediately and before contacting federal authorities.  State and local police have primary jurisdiction over polling places, and almost always have faster reaction capacity in an emergency.

            U.S. Attorney Murray said, “Ensuring free and fair elections depends in large part on the cooperation of the American electorate.  It is imperative that those who have specific information about discrimination or election fraud make that information available to my Office, the FBI, or the Civil Rights Division.”

CHARLOTTE, N.C. – On Thursday, October 15, 2020, U.S. District Judge Kenneth D. Bell handed down prison sentences ranging from 63 to 200 months in prison, to five individuals for their involvement in a methamphetamine trafficking ring, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. 

Judge Bell sentenced the defendants as follows:

• Jeremy Matthew Magnus, 45, of Granite Falls, N.C. was sentenced to 200 months in prison, followed by five years of supervised release. Magnus pleaded guilty to drug trafficking conspiracy and possession with intent to distribute methamphetamine.
• John Brooks Miller, of Hickory, N.C., was sentenced to 120 months in prison and five years of supervised release. He pleaded guilty to conspiracy to distribute methamphetamine and distribution and possession with intent to distribute methamphetamine.
• Angela Dale, 33, of Morganton, N.C., was sentenced to 97 months in prison and three years of supervised release. Dale pleaded guilty to conspiracy to distribute methamphetamine and possession with intent to distribute methamphetamine.
• Bradley Scott Carroll, 37, of Hildebran, N.C., was sentenced to 78 months in prison and four years of supervised release. He pleaded guilty to conspiracy to distribute methamphetamine and distribution and possession with intent to distribute methamphetamine.
• David William Pope, 66, of Connelly Springs, N.C., was sentenced to 63 months in prison and five years of supervised release. Pope pleaded guilty to conspiracy to distribute 500 grams of methamphetamine and distribution and possession with intent to distribute 50 grams or more of methamphetamine.
   

According to court documents and the sentencing hearings, from early 2019 to February 2020, Magnus and his co-conspirators trafficked crystal methamphetamine in Caldwell, Catawba and Burke Counties. Magnus was the drug conspiracy’s leader and a supplier of crystal methamphetamine to local drug networks.  Court records show that Magnus and Dale frequently transported methamphetamine from Georgia to the Hickory area. Court records show that the defendants trafficked more than 30 kilograms of methamphetamine. Over the course of this part of the investigation, law enforcement seized approximately 1.3 kilograms of methamphetamine.

This case is the result of the Organized Crime Drug Enforcement Task Force (OCDETF) Operation “Dixie Crystal.” Since 2015, Operation Dixie Crystal has resulted in the prosecution of more than 200 individuals, and law enforcement have seized over 20 kilograms of crystal methamphetamine, more than $500,000 in U.S. currency and other assets, and dozens of firearms.

OCDETF is a joint federal, state and local cooperative approach to combat drug trafficking and is the nation’s primary tool for disrupting and dismantling major drug trafficking organizations, targeting national and regional drug trafficking organizations and coordinating the necessary law enforcement entities and resources to disrupt or dismantle the targeted criminal organization and seize their assets.

In making today’s announcement, U.S. Attorney Murray recognized the following federal, state and local agencies which partnered in Operation Dixie Crystal, and thanked them for their continued cooperation and support:  the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); the North Carolina State Bureau of Investigation (NC SBI); the Ashe County Sheriff’s Office; the Alexander County Sheriff’s Office; the Burke County Sheriff’s Office; the Caldwell County Sheriff’s Office; the Catawba County Sheriff’s Office; the Hickory Police Department; the Jefferson Police Department, the Lincoln County Sheriff’s Office; and the Mooresville Police Department.

The prosecutions are being handled by Assistant U.S. Attorney Steven R. Kaufman of the U.S. Attorney’s Office in Charlotte.

ABINGDON, Virginia – A Bristol, Virginia man pleaded guilty yesterday in U.S. District Court in Abingdon to three federal gun charges related to offenses occurring in both the Western District of Virginia and the Western District of North Carolina. Acting United States Attorney Daniel P. Bubar of the Western District of Virginia, United States Attorney Andrew R. Murray of the Western District of North Carolina, and Ashan M. Benedict, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) Washington Field Division made the announcement today.

Michel Andrew Houser, 48, pleaded guilty to two counts of an indictment filed in the Western District of Virginia charging him with possession of an unregistered machinegun and possession of an unregistered silencer. In addition, Houser pleaded guilty to a one-count Information filed in the Western District of North Carolina charging him with illegal possession of firearms by a previously convicted felon.

“When felons possess firearms, it produces violence in our neighborhoods.  As today’s plea agreement demonstrates, we will continue to prioritize these cases,” Acting United States Attorney Bubar said today. “I am grateful to our partners at the ATF and United States Attorney Murray in the Western District of North Carolina for continuing to keep out communities safe.”

“Guns do not belong in the hands of felons,” said Andrew Murray, U.S. Attorney for the Western District of North Carolina. “Removing illegal firearms from our streets and prosecuting repeat gun offenders is a critical step toward tackling gun violence and building stronger and safer communities.”

“Aside from the fact that this defendant is a convicted felon and unable to lawfully possess a firearm, the nature of the weapons recovered – to include a machinegun – is of serious concern not only to law enforcement, but to all residents of Washington County,” said ATF Washington Special Agent in Charge Ashan M. Benedict. “His plea today on all charges is a testament to the excellent investigative work by both ATF and our law enforcement partners in Western Virginia and North Carolina.  Their efforts resulted in overwhelming evidence against this defendant and led to his admission of guilt.”

According to court documents, on December 4, 2019 Houser was arrested at his home in Bristol, Virginia on state charges. Following his arrest, Houser called a friend and asked him to retrieve certain firearms and ammunition from Houser’s home. At Houser’s request, the friend retrieved several firearms, and silencer, and ammunition.   

During an investigation, ATF examined a receiver from one of the firearms and determined that it met the definition of a machine gun.  Houser had not registered either the machinegun or the silencer, as required by federal statute.

On or about January 23, 2020, Houser was convicted of two felonies in Washington County, Virginia. After his July 2020 federal indictment relating to the machinegun and silencer, law enforcement located Houser in Avery County, North Carolina. At the time of his arrest, Houser was found to be in possession of three firearms and ammunition, after having been convicted of the two prior felonies.   

At sentencing, Houser faces up to 10 years in prison and/or a fine of up to $250,000. A sentencing hearing has been scheduled for January 23, 2020.

The investigation of the case was conducted by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Avery County, North Carolina Sheriff’s Office.  Assistant United States Attorney Whit D. Pierce, of the Western District of Virginia, and David Thorneloe, of the Western District of North Carolina, are prosecuting the case for the United States.  

CHARLOTTE, N.C. – Roger Mack Royal, 40, of North Wilkesboro, N.C., was sentenced to 188 months in prison today for drug and gun charges, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.  U.S. District Judge Kenneth D. Bell also ordered Royal to serve five years under court supervision after he is released from prison. 

According to filed court documents and today’s sentencing hearing, in January 2019, Royal, his co-conspirator April Renee Hicks, and another defendant, Joshua Allen McCloud, trafficked methamphetamine in Wilkes and Caldwell counties and elsewhere in Western North Carolina.  Law enforcement arrested Royal and Hicks on January 29, 2019, following a drug transaction that took place in a Walmart parking lot. Over the course of their arrest, law enforcement recovered a stolen firearm from Royal’s vehicle.

On May 19, 2020, Royal pleaded guilty to conspiracy to distribute and to possess with intent to distribute methamphetamine, four counts of possession with intent to distribute and distribution of methamphetamine, and possession of a firearm by a felon. Court records indicate that Royal has over 40 state felony convictions in North and South Carolina. Due to his prior criminal convictions, Royal qualified for a sentencing enhancement as an armed career criminal.

Joshua McCloud was previously sentenced to 11 years in prison for drug and firearm offenses. Over the course of the investigation, law enforcement recovered from McCloud’s residence two firearms, a 60-round drum magazine, 39 rounds of assorted ammunition, narcotics and drug paraphernalia. April Hicks was sentenced to 57 months in prison after pleading guilty to conspiracy to distribute and to possess with intent to distribute methamphetamine, and possession with intent to distribute and distribution of methamphetamine.

In making today’s announcement, U.S. Attorney Murray credited the Bureau of Alcohol, Tobacco, Firearms and Explosives, the North Carolina State Bureau of Investigation, the Wilkesboro Police Department, the North Wilkesboro Police Department, the Caldwell County Sheriff’s Office, the Ashe County Sheriff’s Office, the Alexander County Sheriff’s Office, the Boone Police Department, the Watauga County Sheriff’s Office, and the Yadkin County Sheriff’s office for the investigation of this case, and thanked each agency for their cooperation and coordination.

Assistant United States Attorney David Kelly, of the U.S. Attorney’s Office in Charlotte, prosecuted the cases.

* * *

On Tuesday, October 13, 2020, the Justice Department announced it has charged more than 14,200 defendants with firearms-related crimes during Fiscal Year 2020 (FY20), despite the challenges of COVID 19 and its impact on the criminal justice process. Of the more than 14,200 individuals charged in FY20, 267 defendants were charged in the Western District of North Carolina.

“Gun crimes are often committed by people prohibited from having guns in the first place,” said U.S. Attorney Murray. “Together with our law enforcement partners, we are committed to protecting our communities by keeping guns out of the wrong hands, taking violent criminals off our streets, and prosecuting those who violate federal gun laws.”

Under federal law, it is illegal to possess a firearm if you fall into one of nine prohibited categories including being a felon, illegal alien, or unlawful user of a controlled substance. Further, it is unlawful to possess a firearm in furtherance of a drug trafficking offense or violent crime.  It is also illegal to purchase – or even to attempt to illegally purchase - firearms if the buyer is a prohibited person or illegally purchasing a firearm on behalf of others. Lying on ATF Form 4473, which is used to lawfully purchase a firearm, is also a federal offense.  The Department is committed to prosecuting these firearms offenses as well as using all modern technologies available to law enforcement such as the National Integrated Ballistic Information Network, known as NIBIN, to promote gun crime intelligence. Keeping illegal firearms out of the hands of violent criminals will continue to be a priority of the Department of Justice and we will use all appropriate, available means to keep the law abiding people of this country safe from gun crime. 

For more information on the lawful purchasing of firearms, please see: https://www.atf.gov/qa-category/atf-form-4473.         

CHARLOTTE, N.C. – David Clarke, 30, of Charlotte, appeared before U.S. Magistrate Judge David S. Cayer today, and pleaded guilty to federal charges for his role in two separate schemes involving identity theft, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. Clarke’s co-conspirator, Jamel Johnson, previously pleaded guilty for his involvement in the schemes.

Clarke and Johnson were initially indicted on June 19, 2020, on bank and wire fraud conspiracy and aggravated identity theft charges, for orchestrating a scheme in which they used stolen personal information of identity theft victims to obtain fraudulent bank loans. On October 7, 2020, new federal wire fraud charges were filed against Clarke, for using stolen identities to file for, and receive, COVID-19 Unemployment Insurance (UI) benefits.

According filed court documents and statements made at Clarke’s plea hearing today, from August 2019 to June 2020, Clarke, Johnson and their co-conspirators engaged in a bank loan scheme involving the use of stolen information of identity theft victims. Court documents show that, after acquiring the victims’ stolen identities on the internet and elsewhere, the co-conspirators used them to attempt to obtain more than $1,000,000 in fraudulent bank loans and goods.

According to court records, over the course of the investigation into the bank loan scheme, law enforcement discovered that Clarke was also executing a separate scheme involving COVID-19 UI benefits. In this scheme, court records show that, from May through July 2020, Clarke defrauded the U.S. Department of Labor, the State of Wisconsin, and the State of Arizona, by submitting fraudulent claims for unemployment insurance benefits in the names of identity theft victims. During the relevant time-period, Clarke fraudulently obtained over $82,500 in fraudulent UI benefits using the compromised identities of more than 60 victims. According to court records, Clarke directed that payments of the fraudulent UI benefits be made to Green Dot cards, or to bank accounts under Clarke’s control.

Clarke is currently in federal custody. The charge of conspiracy to commit bank and wire fraud carries a maximum prison sentence of 30 years and a $1 million fine. The aggravated identity theft charge carries a minimum prison term of two years, consecutive to any other prison term imposed, and a $250,000 fine. The wire fraud charge carries a maximum prison sentence of 20 years and a $250,000 fine.

Clarke’s co-defendant, Johnson, has also pleaded guilty to bank and wire fraud conspiracy, aggravated identity theft, and wire fraud for his role in both schemes. A third co-defendant involved in the bank loan scheme, Justin Parks, has pleaded guilty to bank and wire fraud conspiracy and aggravated identity theft. A sentencing date for Clarke, Johnson and Parks has not been set.

The charges against Mikael Roberts, for his alleged involvement in the loan scheme, are still pending, and the defendant is presumed innocent unless and until proven guilty beyond reasonable doubt in a court of law. 

In making today’s announcement, U.S. Attorney Murray commended the U.S. Postal Inspection Service for their investigative efforts, and thanked the Atlanta Regional Office of the U.S. Department of Labor, Office of the Inspector General, and the Charlotte Mecklenburg Police Department for their invaluable assistance.

The prosecution for the government is handled by Assistant United States Attorney Jenny G. Sugar of the U.S. Attorney’s Office in Charlotte.  

CHARLOTTE, N.C. – Today, the Department of Justice announced it has charged more than 14,200 defendants with firearms-related crimes during Fiscal Year 2020 (FY20), despite the challenges of COVID 19 and its impact on the criminal justice process. These cases have been a Department priority since November 2019 when Attorney General William P. Barr announced his commitment to investigating, prosecuting, and combatting gun crimes as a critical part of the Department’s anti-violent crime strategy. These firearms-related charges are the result of the critical law enforcement partnership between United States Attorneys’ Offices and the Bureau of Alcohol, Tobacco, Firearms and Explosives, led by Acting Director Regina Lombardo, who has made firearms-related investigations a priority.

“The number one priority of government is to keep its citizens safe,” said Attorney General Barr. “By preventing firearms from falling into the hands of individuals who are prohibited from having them, we can stop violent crime before it happens. Violating federal firearms laws is a serious crime and offenders face serious consequences.  The Department of Justice is committed to investigating and prosecuting individuals who illegally buy, sell, use, or possess firearms. Reducing gun violence requires a coordinated effort, and we could not have charged more than 14,000 individuals with firearms-related crimes without the hard work of the dedicated law enforcement professionals at the ATF, our U.S. Attorneys’ Offices across the country, and especially all of our state and local law enforcement partners.”

“Protecting the public from violent crime involving firearms is at the core of ATF’s mission,” commented ATF Acting Director Regina Lombardo.  “Every day the men and women of ATF pursue and investigate those who use firearms to commit violent crimes in our communities, many of whom are prohibited from possessing firearms from previous convictions.  ATF, in collaboration with the U.S. Attorneys’ Offices across the nation, is committed to bringing these offenders to justice for their egregious and violent criminal acts.”

Of the more than 14,200 individuals charged in FY20, 267 defendants were charged in the Western District of North Carolina.

“Gun crimes are often committed by people prohibited from having guns in the first place,” said U.S. Attorney Murray. “Together with our law enforcement partners, we are committed to protecting our communities by keeping guns out of the wrong hands, taking violent criminals off our streets, and prosecuting those who violate federal gun laws.”

Under federal law, it is illegal to possess a firearm if you fall into one of nine prohibited categories including being a felon, illegal alien, or unlawful user of a controlled substance. Further, it is unlawful to possess a firearm in furtherance of a drug trafficking offense or violent crime.  It is also illegal to purchase – or even to attempt to illegally purchase - firearms if the buyer is a prohibited person or illegally purchasing a firearm on behalf of others. Lying on ATF Form 4473, which is used to lawfully purchase a firearm, is also a federal offense.  The Department is committed to prosecuting these firearms offenses as well as using all modern technologies available to law enforcement such as the National Integrated Ballistic Information Network, known as NIBIN, to promote gun crime intelligence. Keeping illegal firearms out of the hands of violent criminals will continue to be a priority of the Department of Justice and we will use all appropriate, available means to keep the law abiding people of this country safe from gun crime. 

For more information on the lawful purchasing of firearms, please see: https://www.atf.gov/qa-category/atf-form-4473.

CHARLOTTE, N.C. – Andrew Murray, U.S. Attorney for the Western District of North Carolina, announced today federal charges against four individuals, for operating as “money mules” in two separate business email compromise schemes.

A business email compromise scheme, or BEC, is a sophisticated scam, often targeting businesses involved in wire transfer payments. The fraud is carried out by compromising and/or “spoofing” legitimate business email accounts through social engineering or computer intrusion techniques, to cause employees of the victim company (or other individuals involved in legitimate business transactions) to transfer funds to accounts controlled by scammers. In addition to targeting businesses, BEC scams also often target individual victims, convincing victims to make wire transfers to bank accounts controlled by the scammers.

U.S. vs. Okwara

On September 17, 2020, a federal grand jury sitting in Charlotte returned a criminal indictment against Chukwudi Michael Okwara, 40, of Charlotte, for his involvement in a BEC scheme that defrauded at least six companies of approximately $2 million.

According to allegations contained in the indictment, beginning in November 2018, Okwara, who also goes by “Collins Bird” and “Larry Eugene Coleman,” used fake documents to open multiple “money mule” bank accounts. Money mule accounts are bank accounts used by fraudsters as a pass-through means of moving fraudulently obtained funds. As alleged in the indictment, Okwara used the money mule accounts to receive and launder the proceeds of business email compromise (BEC) scams perpetrated on the victim companies. Okwara also allegedly used false identities and conducted financial transactions with the fraudulently obtained proceeds in order to conceal their origins. 

Okwara is charged with 27 counts of money laundering, which carry a maximum sentence of 20 years and a $500,000 fine per count; five counts of conducting financial transactions with illegal proceeds, which carry a maximum prison sentence of 10 years and a $250,000 fine per count; two counts of submitting false documents to banks, which carry a maximum prison term of 30 years and a $1,000,000 fine per count; and two counts of aggravated identity theft, which carry a mandatory minimum sentence of two years in prison, per count, to be served consecutively to any other sentence imposed.

Okwara had his initial appearance today before U.S. Magistrate Judge David C. Keesler. Okwara’s next court hearing is set for October 15, 2020, in Charlotte.

U.S. vs. Johnson et al.

A second indictment related to BEC fraud charges Linda Dianne Johnson, 70, of Charlotte, Wanda Jackson Barker, 71, of Athens, Texas, and Olayinka Agboola, 54, of Chicago, Illinois, with conspiracy to commit money laundering. Johnson is also charged with two counts of conducting financial transactions with illegal proceeds.

The indictment was returned on September 16, 2020, and was unsealed earlier this week. According to allegations in the indictment, Johnson, Barker, and Agboola operated as money mules and conspired to launder at least $575,000 derived from a fraudulent BEC scheme. The indictment alleges that the co-conspirators tricked the United States Department of State and a non-profit agency into wiring proceeds into bank accounts controlled by Johnson. Upon receipt of the fraud proceeds, Johnson, Barker, and Agboola executed financial transactions for the purpose of enriching themselves and their co-conspirators. 

Johnson is set to appear in court in Charlotte on October 22, 2020. Barker’s initial appearance has been set for November 9, 2020. Agboola has not been arrested yet.

The money laundering conspiracy charge carries a maximum sentence of 20 years in prison and a $500,000 fine. Johnson faces a maximum sentence of 10 years in prison and a $250,000 fine for each charge of conducting financial transactions with illegal proceeds.

The charges in the indictments are allegations and the defendants are presumed innocent unless and until proven guilty beyond reasonable doubt in a court of law. 

In making today’s announcement, U.S. Attorney Murray thanked the investigating efforts of the U.S. Postal Inspection Service, the FBI, and U.S. Department of State, Office of the Inspector General, which led to the indictments.

Assistant United States Attorney Matt Warren is in charge of the prosecution against Okwara.  Assistant United States Attorneys Caryn Finley and Graham Billings are handling the prosecution against Johnson, Barker and Agboola.  

ASHEVILLE, N.C. – U.S. Attorney R. Andrew Murray announced today that the U.S. District Court in Asheville has ordered the forfeiture of a residence located at 129 Reservoir Ridge Drive, in Cullowhee, N.C., used to facilitate extensive drug activities.

“The illicit drug trafficking that took place in the residence jeopardized the health and safety of the entire neighborhood. The drug activity was particularly harmful to the community because the house was adjacent to the campus of Western Carolina University and near a preschool,” said U.S. Attorney Murray. “Drug dealers who use their homes to conduct drug transactions are on notice: together with our enforcement partners, we will use all tools at our disposal to take action and protect law-abiding citizens.”

A federal civil forfeiture complaint filed by the U.S. Attorney’s Office on May 1, 2018, alleged that the residence was used for several years to facilitate the distribution of illegal narcotics, including LSD and marijuana. According to court documents, the residence was the site of multiple illegal drug transactions in 2017 and 2018, and posed a threat to the safety and welfare of the surrounding neighborhood, including the campus of Western Carolina University.

According to the complaint, as early as 2016, the Jackson County Sheriff’s Office began receiving complaints from neighbors concerning drug trafficking activities by the owner of the residence, Mark Loren Miller, who entertained heavy car and foot traffic on a daily basis. Court documents also show that Miller’s neighbors routinely recovered needles and other drug paraphernalia near the residence. In 2018, law enforcement executed a search warrant at the residence, and recovered MDMA, a drug commonly known as “Ecstasy,” a large amount of cash, digital scales, and other drug paraphernalia.

The civil case filed by the United States was stayed pending the resolution of Miller’s state criminal case.  Following Miller’s guilty plea to state criminal charges related to his drug activities, litigation in federal court ensued.  On Friday, October 2, 2020, the Court ordered the forfeiture of the residence to the United States.

In making today’s announcement U.S. Attorney Murray commended the collaboration between the Jackson County Sheriff’s Office, the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the U.S. Attorney’s Office.

Assistant United States Attorney Jonathan D. Letzring, of the U.S. Attorney’s Office in Asheville, handled the civil proceedings. 

CHARLOTTE, N.C. – A federal jury handed down a guilty verdict against a Charlotte woman late yesterday, for her involvement in a $300,000 embezzlement scheme perpetrated on an elderly, dementia-afflicted victim, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. Donna Graves, 58, was convicted of conspiracy to commit wire fraud and money laundering conspiracy. U.S. District Judge, Max O. Cogburn, Jr. presided over the trial.

Tommy D. Coke, Inspector in Charge of the of the Atlanta Division of the U.S. Postal Inspection Service, which oversees Charlotte, Michael E. Stansbury, Acting Special Agent in Charge for the FBI in North Carolina, and Chief Tim W. Ledford of the Mint Hill Police Department join U.S. Attorney Murray in making today’s announcement.

According to filed court documents, evidence presented at trial and witness testimony, from January 2015 through September 2019, Graves and her two co-conspirators, Gerald Maxwell Harrison and Elizabeth Robin Williams, engaged in a scheme to defraud a victim identified in court documents as “K.T.” The victim was an elderly widow who lived alone and suffered from dementia and other physical and mental challenges.

Trial evidence established that, beginning in February 2014, Graves and Williams provided housekeeping services for the victim through a business owned and operated by Graves. Court records show that, over the course of the scheme, the co-conspirators isolated the victim from her friends and family, induced the victim to give them power and control over her personal affairs, and fabricated a power of attorney purporting to give Graves and Williams control over the victim’s financial affairs.  According to trial evidence and witness testimony, once they gained access and control, Graves, Williams, and Harrison moved the victim out of her residence in Indian Land, South Carolina, first to an apartment in Charlotte, and later to a rental home in Mint Hill, refusing to let the victim’s friends and family know where she was living. 

Trial evidence also established that Graves, Williams, and Harrison engaged in numerous illegal and unauthorized financial transactions that substantially depleted the victim’s money and property.  Specifically, the co-conspirators emptied the victim’s bank accounts and used the money to pay for personal expenses, and they fraudulently “maxed out” at least one credit card in the victim’s name.  The co-conspirators also fraudulently transferred or attempted to transfer the victim’s Indian Land residence to themselves by creating a quit claim deed purporting to gift the residence to Harrison, they pawned the victim’s jewelry, and they stole the victim’s federal benefits.  Additionally, Williams unlawfully used the victim’s money to set up other businesses in her name, including a business selling handbags online and a business selling weight loss-related services. As a result of the fraudulent scheme, the co-conspirators defrauded the victim of more than $300,000. 

In May 2020, Williams and Harrison pleaded guilty to wire fraud conspiracy, interstate transportation of stolen property, and money laundering conspiracy. The wire fraud conspiracy charge carries a maximum penalty of 20 years in prison and a $250,000 fine. The statutory maximum penalty for the money laundering conspiracy charge is 20 years in prison and a $500,000 fine. The interstate transportation of stolen property charge carries a maximum prison term of 10 years and a $250,000 fine.

In making today’s announcement U.S. Attorney Murray commended the Mint Hill Police Department, the FBI, and USPIS for their investigation of this case. 

Assistant United States Attorneys Kenneth M. Smith and Caryn D. Finley, of the U.S. Attorney’s Office in Charlotte, are prosecuting the case.

In March 2019, U.S. Attorney Murray announced the Office’s Elder Justice Initiative, which aims to combat elder financial exploitation by expanding efforts to investigate and prosecute financial scams that target seniors; educate older adults on how to identify scams and avoid becoming victims of financial fraud; and promote greater coordination with law enforcement partners. For more information please visit: https://www.justice.gov/usao-wdnc/elder-justice-initiative

CHARLOTTE, N.C. – Jamel Johnson, 30, of Charlotte, appeared before U.S. Magistrate Judge David Keesler today, and pleaded guilty to federal charges for his role in two separate schemes involving identity theft, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.

Johnson was initially indicted on June 19, 2020, on bank and wire fraud conspiracy and aggravated identity theft charges, for his involvement in a scheme to obtain fraudulent bank loans using stolen personal information of identity theft victims. On September 25, 2020, new federal wire fraud charges were filed against Johnson, for using stolen identities to file for, and receive, COVID-19 Unemployment Insurance (UI) benefits.

According filed court documents and statements made at Johnson’s plea hearing today, from August 2019 to June 2020, Johnson and his co-conspirators engaged in a bank loan scheme involving the use of stolen personal identifying information of identity theft victims. Court documents show that, after acquiring the victims’ stolen identities on the internet and elsewhere, the co-conspirators used them to attempt to obtain more than $1,000,000 in fraudulent bank loans and goods.

According to court records, over the course of the investigation into the bank loan scheme, law enforcement discovered that Johnson was also executing a separate scheme involving COVID-19 UI benefits. In this scheme, court records show that, from May 21, 2020 through July 22, 2020, Johnson defrauded the U.S. Department of Labor, the State of Wisconsin, and the State of Arizona, by submitting fraudulent claims for unemployment insurance benefits in the names of identity theft victims. During the relevant time-period, Johnson fraudulently obtained more than $189,912 in fraudulent UI benefits using the compromised identities of approximately 70 victims. According to court records, Johnson directed that payments of the fraudulent UI benefits be made to Green Dot cards, or to bank accounts under Johnson’s control.

Johnson is currently on release pending sentencing. The charge of conspiracy to commit bank and wire fraud carries a maximum prison sentence of 30 years and a $1 million fine. The aggravated identity theft charge carries a minimum prison term of two years, consecutive to any other prison term imposed, and a $250,000 fine. The wire fraud charge carries a maximum prison sentence of 20 years and a $250,000 fine.

One of Johnson’s co-defendants in the bank loan scheme, Justin Parks, has also pleaded guilty to bank and wire fraud conspiracy and aggravated identity theft. A sentencing date for Johnson and Parks has not been set. The charges against David Clarke and Mikael Roberts for their alleged involvement in the loan scheme are still pending, and the defendants are presumed innocent unless and until proven guilty beyond reasonable doubt in a court of law. 

In making today’s announcement, U.S. Attorney Murray commended the U.S. Postal Inspection Service for their investigative efforts, and thanked the Atlanta Regional Office of the U.S. Department of Labor, Office of the Inspector General, and the Charlotte Mecklenburg Police Department for their invaluable assistance.

The prosecution for the government is handled by Assistant United States Attorney Jenny G. Sugar of the U.S. Attorney’s Office in Charlotte.  

CHARLOTTE, N.C. – A criminal indictment in U.S. District Court charges Eric M. Hill, 44, of Charlotte, with insider trading, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. The indictment was returned by a grand jury last week and was unsealed this morning, following Hill’s initial court appearance.    

John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation in North Carolina, joins U.S. Attorney Murray in making today’s announcement. 

The indictment alleges that between October 13, 2015, and October 26, 2015, Hill committed insider trading based on nonpublic information pertaining to a proposed acquisition of Piedmont Natural Gas Company, Inc. (Piedmont) by Duke Energy Corporation (Duke Energy). Stealing material, nonpublic inside information allows a trader to cheat and earn substantial profits by trading before such news becomes public, earning profits by trading again once the news becomes public and impacts the price of a stock. 

According to allegations in the indictment, Hill misappropriated the nonpublic information from an employee of a consulting firm that provided services to Piedmont. The indictment alleges that Hill used the confidential information to conduct a series of securities transactions prior to and after the announcement of the acquisition of Piedmont by Duke Energy.  The indictment further alleges that Hill took in over $380,000 as a result of his illegal insider trading activities. 

Hill is charged with fraud in connection with the purchase and sale of securities, which carries a maximum prison term of 20 years and a $5 million fine. He is also charged with seven counts of securities fraud, which carry a maximum prison term of 25 years, and a fine of $250,000, per count.

An indictment is merely an allegation, and the defendant is presumed innocent unless and until proven guilty beyond reasonable doubt in a court of law. 

In announcing the indictment, U.S. Attorney Murray commended the FBI for their investigation of this case. In a related matter, the Securities and Exchange Commission announced a separate civil action against Hill filed with the U.S. District Court in the Western District of North Carolina.

The prosecution for the government is handled by Assistant United States Attorneys Daniel Ryan and Graham Billings, of the U.S. Attorney’s Office in Charlotte.  

CHARLOTTE, N.C. – Today, U.S. Attorney Andrew Murray announced the results of the U.S. Attorney’s Office latest public legal action in its ongoing efforts to combat fraud schemes seeking to exploit the coronavirus pandemic. A warrant resulting in the seizure of $140,490.34 from a bank account has been unsealed in federal court.  Law enforcement seized the funds after determining that the account was used to perpetuate COVID-19 fraud. 

Reginald A. DeMatteis, Special Agent in Charge of the United States Secret Service, Charlotte Field Office, joins U.S. Attorney Murray in making today’s announcement.

The affidavit filed in support of the federal warrant alleges that the funds were seized as part of an investigation of a COVID-19 Small Business Administration (SBA) Paycheck Protection Program fraud scheme.  The alleged scheme implicated a bank account purportedly opened by Oscar Estala, and/or one or more other individuals in the Western District of North Carolina.  As alleged in court documents, the bank account identified in the seizure warrant was used to receive approximately $149,900 in funds fraudulently obtained from the SBA, purportedly for a small business named “VR Wesson.”  The funds from the SBA are intended to provide financial assistance to qualifying small businesses and individuals impacted by the coronavirus outbreak. As alleged in the unsealed affidavit, law enforcement determined that the account that received the funds was not used to fund a business or employees impacted by COVID-19. Instead, the account was used to make retail and gift card purchases.    

The unsealing of the warrant adds to a list of unsealed court documents in which the U.S. Attorney’s Office, the U.S. Secret Service, and other federal, state and local law enforcement partners, including the Charlotte-Mecklenburg Police Department, have coordinated and worked closely to combat fraud related to the coronavirus, and to recover hundreds of thousands in proceeds of such fraud. 

In making today’s announcement, U.S. Attorney Murray commended the U.S. Secret Service for their work in this case.  U.S. Attorney Murray also thanked financial institutions in the Western District of North Carolina for their cooperation and their efforts to detect and report COVID-19 financial fraud.

Assistant U.S. Attorney Benjamin Bain-Creed, of the U.S. Attorney’s Office in Charlotte, is handling the federal warrants.

U.S. Attorney Murray also urged the public to remain alert in detecting COVID-19 fraud and to report suspicious activity to the local authorities, or by calling the Department of Justice’s National Center for Disaster Fraud Hotline at 866-720-5721 or via the NCDF Web Complaint Form.  Members of the public in the Western District of North Carolina are also encouraged to call 704-344-6222 to reach their local Coronavirus Fraud Coordinator at the U.S. Attorney’s Office.

CHARLOTTE, N.C. – Andrew Murray, U.S. Attorney for the Western District of North Carolina, announced today the return of federal indictments against 17 individuals charged with federal firearms violations.

The indictments are the result of Project Guardian, the Justice Department’s signature initiative to reduce gun violence and enforce federal firearms laws. Initiated by Attorney General William P. Barr in the fall of 2019, Project Guardian draws upon the Department’s past successful programs to reduce gun violence, and enhances coordination of federal, state, local, and tribal authorities in investigating and prosecuting gun crimes. The initiative also improves information sharing, and ensures that federal resources are directed at the criminals posing the greatest threat to our communities.

“Gun violence remains a pervasive problem in communities across this district and our nation,” said U.S. Attorney Murray. “The indictments announced today are a testament to our ongoing coordination with our federal, state and local law enforcement partners and state prosecutors, and our shared commitment to reduce gun violence, remove firearms from the hands of felons, and bring to justice those who violate gun laws.”

“ATF has a long-standing commitment with our law enforcement partners to tackle gun violence and violent crimes in our communities,” said Vince Pallozzi, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives. “Removing violent criminals from our neighborhoods and recovering the firearms used in their crimes is a critical step toward stronger and safer neighborhoods.”

“We see every day how gun violence can cause heartache and destroy lives. Thanks to our partner agencies, the work done here is a step in the right direction to making communities safer and holding individuals accountable for their actions,” said Robert Schurmeier, Director of the North Carolina State Bureau of Investigation.

"Catawba County is a safer place today thanks to the incredible success of our local, state and federal partnership. The collaboration and teamwork demonstrated in this operation is some of the finest I have witnessed. I'm proud to have my office associated with these law enforcement professionals," said Sheriff Don Brown, of the Catawba County Sheriff’s Office.

“There is no doubt that these arrests will make our communities safer,” said Chief Thurman Whisnant of the Hickory Police Department. In Hickory, we very much appreciate the continued collaboration and cooperation among our local, state and federal law enforcement and prosecutors who are all committed to pursuing violent offenders that put our communities at risk.”

“The Long View Police department has a solid relationship with our federal, state, and local law enforcement partners.  We are committed to disrupting criminal activity and keeping our communities safe. I am extremely proud of the law enforcement partnership and the outcome of this operation,” said Chief T.J. Bates of the Long View Police Department.

            The 17 individuals indicted for firearms violations are:

• Trevin Ali Brown, 22, of Hickory, N.C.
• Chaetez Sean Clayton, 30, of Hickory, N.C.
• Shawn Malcolm Davis, 30, of Catawba, N.C.
• Donte Rassan Gore, 28, Hickory, NC.
• Daquan Lashawn Ikard, 30, of Hickory, N.C.
• Martavious Steven Isbell, 26, of Granite Falls, N.C.
• Gevon Marquise King, 36, of Hickory, N.C.
• Line Germaine Linebarger, 33, of Hickory, N.C.
• Robbie Octavion Little, 28, of Hickory, N.C.
• Curese Devin McIlwain, 35, of Hickory, N.C.
• Stanley Earl Reed, 29, of Hickory, N.C.
• Meguel Greylen Robinson, 25, of Hickory, N.C.
• Craig Anthony Ruff, 25, of Newton, N.C.
• Nicholas Anthony Santellan, 37, of Hickory, N.C.  
• Michael Dwane Williams, 23, or Hickory, N.C.
• Wilburn Johnathan Wilson, 25, of Hickory, N.C.
• Tou Yang, 38, of Hickory, N.C.

As a result of the initiative, law enforcement have recovered more than 100 firearms, some o which were stolen, unregistered, or used in the commission of other violent crimes, ammunition, and a silencer, among other items. The defendants had their first court appearance in federal court in Charlotte today. Davis, Gore, McIlwain Robinson, Santellan, Wilson and Yang are also facing drug trafficking charges.
 
The charges in the indictments are allegations. The defendants are presumed innocent until proven guilty beyond reasonable doubt in a court of law.
 
In making today’s announcement, U.S. Attorney Murray thanked Scott Reilly, District Attorney for Caldwell, Burke and Catawba Counties. “Our partnership and collaboration with state prosecutors is a vital factor in the success of federal crime reduction initiatives like Project Guardian. I want to thank District Attorney Reilly for his office’s continued assistance and coordination with the U.S. Attorney’s Office, and I look forward to our continued joint efforts to increase safety in our communities,” said U.S. Attorney Murray.
 
The United States Attorney’s Office is prosecuting these cases with support from the following Project Guardian partners: the ATF, the SBI, the Catawba County Sheriff’s Office, the Hickory Police Department, and the Long View Police Department. The U.S. Secret Service, the FBI, the U.S. Marshals Service, and the Burke County Sheriff’s Office also assisted with the arrests. 
           
Assistant U.S. Attorneys Lambert Guinn, Christopher Hess and Sanjeev Bhasker, of the U.S. Attorney’s Office in Charlotte, are handling the prosecutions.
 
For more information about Project Guardian, please visit: https://www.justice.gov/projectguardian
           

CHARLOTTE, N.C. – A federal grand jury sitting in Charlotte has returned a criminal indictment, charging David Stuart Lutz, the Director of Public Works (DPW) for the City of Brevard, with environmental crimes related to the handling, transportation, and storage of hazardous waste, announced Andrew Murray U.S. Attorney for the Western District of North Carolina. 

Chuck Carfagno, Special Agent in Charge of the U.S. Environmental Protection Agency, Criminal Investigation Division (EPA-CID) of the Atlanta Area Office, and Robert Schurmeier, Director of the North Carolina State Bureau of Investigation (SBI), join U.S. Attorney Murray in making today’s announcement.

According to allegations contained in the indictment, Lutz, 64, of Pisgah Forest, N.C., violated the Resource Conservation and Recovery Act, by illegally directing DPW employees to dig up soil known to be hazardous for lead, from the backstop of the City of Brevard’s (the City) firing range, without the use of any of the required protective equipment or procedural safeguards. The indictment further alleges that Lutz directed the employees to transport the contaminated soil in City-owned vehicles, without the requisite hazardous waste manifest. As alleged in the indictment, Lutz further instructed the employees to move the contaminated soil to the DPW Operations Center and store it there, even though the area is not permitted as a treatment, storage, or disposal location for hazardous waste, such as lead.  According to the indictment, the alleged hazardous waste violations occurred from about May 3, 2016, to on or about May 5, 2016.

Lutz will have his initial appearance in federal court in Asheville, before U.S. Magistrate Judge W. Carleton Metcalf in the coming days.

The charges against Lutz are allegations. The defendant is presumed innocent until proven guilty beyond reasonable doubt in a court of law. 

The charge of illegally transporting hazardous waste without a manifest carries a maximum prison term of two years and a $50,000 for each day of violation. The illegal transportation of hazardous waste to an unpermitted facility, and the illegal storage of hazardous waste, each carry a maximum prison term of five years.

In making today’s announcement, U.S. Attorney Murray thanked the EPA-CID and the SBI for their investigation that led to charges.

Assistant United States Attorney Steven Kaufman, of the U.S. Attorney’s Office in Charlotte, is prosecuting the case.

CHARLOTTE, N.C. – Today, U.S. District Judge Kenneth D. Bell, sentenced Anthony Blane Byrnes, 19, of Huntersville, N.C., to 71 months in prison on drug charges, for trafficking narcotics he purchased on the dark web using cryptocurrency, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. In addition to the prison term imposed, Byrnes was also ordered to serve four years of supervised release.

According to the Criminal Information to which Byrnes pleaded guilty, other documents filed in this case and statements made in court, Byrnes conspired with a regional Drug Trafficking Organization (DTO) to distribute narcotics on the Dark Web. In August 2019, law enforcement intercepted a mail parcel from Slovenia addressed to Byrnes, containing suspected narcotics. On or about August 7, 2019, law enforcement conducted a controlled delivery of this parcel at Byrnes’s Huntersville, NC residence.  Law enforcement observed Byrnes gathering the parcel and entering his residence. Subsequently, law enforcement executed a search warrant at the residence and seized numerous narcotics and contraband, including LSD, Psilocin, DMT, MDMA/Ecstasy, among other narcotics and paraphernalia. Law enforcement also recovered two firearms from the residence. Court documents demonstrate Byrnes had a previous infraction in April 2019, wherein law enforcement seized additional narcotics and a firearm. In total, three firearms and approximately $13,800 (USD) were recovered from Byrnes’ residence over the course of the investigation.

According to court documents, Byrnes purchased narcotics on the Dark Net Marketplace (DNM) “Empire Market.” Byrnes paid for the drugs using Bitcoin cryptocurrency, stored in VC wallets and used Bitcoin ATM machines in the greater Charlotte area to facilitate drug transactions, converting drug proceeds into virtual currency (VC), and arranging drug shipments for the DTO.

In making today’s announcement, U.S. Attorney Murray commended the U.S. Postal Inspection Service for leading the investigation, and thanked the Drug Enforcement Administration, ICE’s Homeland Security Investigations, the U.S.Customs and Border Protection,  and the Huntersville (NC) Police Department for their invaluable assistance.

Assistant United States Attorneys Sanjeev Bhasker and Seth Johnson, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.

CHARLOTTE, N.C. – U.S. Attorney Andrew Murray issued an alert today, warning the public of potential scammers seeking to obtain personal information by claiming to be with the Justice Department.

In making today’s announcement, U.S. Attorney Murray warned, “Watch out for imposters claiming to be Justice Department representatives, attempting to obtain personal information that can be used to perpetrate fraud. It is particularly disturbing that scammers appear to be targeting older adults, though everyone can be potentially victimized. I caution the public to remain extra vigilant against these imposter schemes. If you are contacted, do not disclose any personal information and report the scam by calling the Department of Justice’s Elder Fraud Hotline at 1-833-Fraud-11, or 1-833-372-8311.”

Reports to the National Elder Fraud Hotline indicate these scammers falsely represent themselves as Department of Justice investigators or employees, and attempt to obtain personal information from the call recipient, or they leave a voicemail with a return phone number. The return phone number directs callers to a recorded menu that matches the recorded menu for the Justice Department’s main phone number. Eventually, the caller reaches an “operator” who steers the caller to someone claiming to be an investigator. That “investigator” then attempts to gain the caller’s personal information.

Those who receive imposter calls are cautioned against providing any personal information. If contacted, please file a report with:

• The Justice Department’s Elder Fraud Hotline at 1-833-Fraud-11 (1-833-372-8311).
• The Federal Trade Commission (FTC) via their website or by calling 877–FTC–HELP (877-382-4357).
• The FBI, for law enforcement action at https://www.justice.gov/criminal-fraud/report-fraud.
   

The National Elder Fraud hotline was created for the public to report fraud against individuals who are age 60 or older. The hotline is open seven days a week. For more information about the hotline, please visit https://stopelderfraud.ovc.ojp.gov/.
 
 

CHARLOTTE, N.C. - U.S. Attorney Andrew Murray announced today that two former managers and the owner of the now defunct North-Carolina based Carolina Comprehensive Health Network, PA (CCHN) have agreed to resolve allegations that they violated the False Claims Act by causing CCHN to bill claims for medically unnecessary diagnostic tests and procedures to the Medicare and Medicaid programs. 

Michael Smith, Codey Brown, and CCHN’s former owner, Dr. Harrison Frank, have collectively agreed to pay $900,000.00 to resolve the allegations.

“When health care professionals engage in deceptive schemes for the sake of their bottom line, their patients’ health is no longer their first priority,” said U.S. Attorney Murray. “Billing Medicare and Medicaid for unnecessary testing wastes taxpayer dollars and diverts funds intended for needed medical care.  Working with our state partners, we will use all resources and tools at our disposal to pursue and hold accountable individuals who perpetrate fraud on federal health care programs.”

“When health care programs and providers cheat the Medicaid program, they’re cheating taxpayers,” said Attorney General Josh Stein. “My office will hold accountable any business and individual that commits fraud and wastes health care resources.”

Before it ceased operations, CCHN consisted of a group of healthcare practices, including multiple locations in the Western District of North Carolina, that provided family medicine, immediate care, and pain management services.  The settlement resolves allegations that from May 1, 2015 through November 30, 2015, CCHN billed the Medicare and Medicaid programs for unnecessary diagnostic procedures including positional nystagmus testing, rotational axis testing, nerve conduction testing, and autonomous nervous system testing.

The allegations arose from a lawsuit filed by a whistleblower under the qui tam provisions of the federal False Claims Act, and the North Carolina False Claims Act.  Under the False Claims Acts, private citizens can bring suit on behalf of the government for false claims and share in any recovery.  The act also allows the government to intervene and take over the action.  The government conducted the investigation and intervened in this action to effectuate the settlement.

The settlement is a result of the coordinated effort between the Department of Health and Human Services Office of the Inspector General, the North Carolina Attorney General’s Medicaid Investigations Division, and the United States Attorney’s Office for the Western District of North Carolina. 

The lawsuit resolved by this settlement is United States and the State of North Carolina ex rel. David A. Majure, M.D., Carla C. Majure v. Carolina Comprehensive Health Network, PA, et al. (5:15-CV-134).  The claims resolved in this settlement are allegations only and there has been no determination of liability.

CHARLOTTE, N.C. – Senior U.S. District Judge Graham C. Mullen sentenced to prison the leader and members of a methamphetamine trafficking ring on drug conspiracy charges, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.

Judge Mullen sentenced the defendants as follows:

• The leader, Cheng “Cam” Yang, 34, of Claremont, N.C., was sentenced to 15 years in prison and five years of supervised release.
• Cheng “Cam” Young’s brother, Peng Yang, 35, of Claremont, N.C, was sentenced to 156 months in prison and five years of supervised release.
• Cheng “Cam” Yang’s younger brother, Nicholas Yang, 21, of Claremont, N.C., was sentenced to three years in prison followed by five years of supervised release.
• Cheng “Cam” Yang’s aunt, Susan Yang, 37, of Claremont, N.C., was ordered to serve 42 months in prison and five years of supervised release.
• Cheng “Dawb” Yang, 38, of Morganton, N.C., who bears no familial relationship to Cheng “Cam” Yang, was sentenced to 60 months in prison and five years of supervised release. 
• Austin Litchfield, 31, of Los Angeles, was ordered to serve 12 years in prison and five years of supervised release. 
• Randy Martinez, 27, also of Los Angeles, was sentenced to 48 months in prison and three years of supervised release. 
   

In related cases, Cheng “Cam” Yang’s distributors were sentenced as follows:
 

• Belden Watson, 59, of Rutherford College, N.C., was sentenced to 97 months in prison and five years of supervised release.
• Rex Eversole, 30, of Morganton, was sentenced to 110 months in prison and five years of supervised release; and
• Ashley Vaught, 30, of Lenoir, N.C., was sentenced to 30 months in prison and two years of supervised release.

 
According to filed court documents and statements made in court, from March 2019 to September 2019, Cheng “Cam” Yang led a methamphetamine trafficking conspiracy operating in Caldwell County and elsewhere. Litchfield, assisted by Martinez, was Cheng “Cam” Yang’s California-based source of supply of methamphetamine. Yang distributed the methamphetamine in Caldwell County assisted by his local drug network of distributors. According to court records, over the course of the conspiracy, Cheng “Cam” Yang and his co-defendants distributed more than 45 kilograms of high-purity methamphetamine, with a street value of over $4 million.
During the arrests of the defendants on September 10, 2019, law enforcement seized three and a half kilograms of crystal methamphetamine and seven firearms from the defendants’ homes.
 
The defendants were prosecuted as part of an ongoing Organized Crime Drug Enforcement Task Force (OCDETF) investigation dubbed “Dixie Crystal.” Since 2015, the investigation has led to the prosecution of more than 200 individuals, and the seizure of more than 100 kilograms of crystal methamphetamine, $1,000,000 in U.S. currency and other assets, and dozens of firearms. 
 
OCDETF is a joint federal, state and local cooperative approach to combat drug trafficking and is the nation’s primary tool for disrupting and dismantling major drug trafficking organizations, targeting national and regional drug trafficking organizations, and coordinating the necessary law enforcement entities and resources to disrupt or dismantle the targeted criminal organization and seize their assets.
 

In making today’s announcement U.S. Attorney Murray thanked the following agencies for their investigative efforts which led to the prosecution of this case: ICE’s Homeland Security Investigations (HSI) in Charlotte; the Drug Enforcement Administration’s Charlotte Field Office; the U.S. Postal Inspection Service in Charlotte; the Bureau of Alcohol, Tobacco, Firearms & Explosives in Charlotte; the North Carolina State Bureau of Investigation; the Alexander County Sheriff’s Office; the Burke County Sheriff’s Office; the Caldwell County Sheriff’s Office; the Catawba County Sheriff’s Office; the Lincoln County Sheriff’s Office; the Hickory Police Department; the Mooresville Police Department; the Newton Police Department; the Longview Police Department; the Huntersville Police Department; the Charlotte Mecklenburg Police Department; and the Morganton Department of Public Safety.

Assistant U.S. Attorney Steven R. Kaufman, of the U.S. Attorney’s Office in Charlotte, is prosecuting the case.                           

CHARLOTTE, N.C. – Today, U.S. District Judge Max O. Cogburn Jr. ordered Ramiro Garcia-Valdivia, 33, of Mexico, to serve 10 years in prison and five years of supervised release for drug trafficking and immigration violations, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.

According to court documents and court proceedings, in 2019, Garcia-Valdivia was working for the CJNG Mexican Cartel, and was responsible for trafficking multiple kilograms of heroin into Western North Carolina. On October 1, 2019, law enforcement arrested Garcia-Valdivia in Gastonia, North Carolina. Over the course of the arrest, law enforcement recovered more than eight kilograms of heroin wrapped in bundles, hidden in Garcia-Valdivia’s Ford Explorer vehicle.  Court records show that Garcia-Valdivia intended to deliver these narcotics to other co-conspirators. According to court records, Garcia-Valdivia, who was in the country illegally after being previously deported, engaged in drug trafficking activities while there was an outstanding immigration order for his deportation from the United States.

“Garcia-Valdivia violated our nation’s drug and immigration laws, and trafficked large quantities of heroin, a poisonous substance that shatters our communities and causes thousands of overdose deaths in our country. The lengthy sentence imposed by the Court is appropriate for Garcia-Valdivia’s harmful criminal conduct,” said U.S. Attorney Murray.

On March 10, 2020, Garcia-Valdivia pleaded guilty to drug trafficking conspiracy, possession with intent to distribute heroin, and illegal reentry by an aggravated felon. Garcia-Valdivia is in federal custody, and will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility. 

The investigation was led by ICE’s Homeland Security Investigations, the North Carolina Highway Patrol, and the Gaston County Police Department. 

Assistant U.S. Attorneys Sanjeev Bhasker and Kenneth Smith, of the U.S. Attorney’s Office in Charlotte, prosecuted the case. 

CHARLOTTE, N.C. – Suleman Alhassan, 38, a Ghanaian national residing in Charlotte, was sentenced today by U.S. District Judge Max O. Cogburn Jr. to 51 months in prison and one year of supervised release for his involvement in financial scams targeting older adults, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.  In addition to the prison term imposed, Judge Cogburn ordered Alhassan to pay $1,127,989 as restitution, and to be deported upon completion of his prison term.

Tommy D. Coke, Inspector in Charge of the Atlanta Division of the U.S. Postal Inspection Service (USPIS), which oversees Charlotte, and Ronnie Martinez, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) in Charlotte, join U.S. Attorney Murray in making today’s announcement.

“Alhassan preyed upon older victims by exploiting their vulnerabilities, including their human need for a personal connection and a loving relationship. Some of the victims were exploited repeatedly, until their well ran dry and they had no more money to give,” said U.S. Attorney Murray. “Investigating and prosecuting the full range of criminal activities that exploit America’s seniors is a priority for my office. It’s equally important that all of us look out for our elderly family and friends who may be targeted by scammers, as a watchful eye can make all the difference in keeping our loved ones safe, and preventing their financial and emotional devastation.”

“The U.S. Postal Inspection Service takes great pride in protecting the American public, especially our vulnerable older Americans. Those seeking to defraud and take advantage of our postal customers should know they will not go undetected and will be held accountable,” said Inspector-in-Charge Coke.

“This case makes clear that transnational scammers who believe they can avoid accountability for their crimes are mistaken,” said Special Agent in Charge Martinez. “HSI is committed to using its unique, cross-border investigative authorities to hold persons accountable who defraud senior citizens and other vulnerable persons. We’re appreciative of our partnership with the U.S. Attorney’s Office to successfully prosecute this case, and will continue to work with our federal, state and local partners to identify and stop financial crimes targeting vulnerable populations.”

According to filed documents and today’s sentencing hearing, beginning in or about March 2016, Alhassan conspired with other individuals in the United States and in Ghana to execute romance and precious metals scams that defrauded more than 20 older victims of over $1 million. According to court records, Alhassan and his co-conspirators operated the romance scheme by creating fake profiles and using fake identities on internet dating websites and other methods to target potential fraud victims, who were frequently elderly, with false promises of a romantic relationship. 

According to court records, as part of the scheme, and in addition to developing fake romantic relationships with the victims, Alhassan and others falsely claimed to own large quantities of gold located in Ghana. The victims were induced to send money to Alhassan and others, purportedly to pay for expenses to ship the gold from Ghana to the United States and other countries, where it could be sold.  As Alhassan previously admitted in court documents, he and his co-conspirators falsely told the victims that they would receive a share of the profits when the gold was brought and sold in the United States.

According to court records, Alhassan and his co-conspirators further induced victims to send funds under the guise of securing travel documents for the person with whom the victims believed to be in a romantic relationship. To convince victims to continue to send money, Alhassan and his co-conspirators invented fictitious obstacles, including problems with travel visas and customs related issues. The co-conspirators continued to call, text, and e-mail the victims and insist that more money was needed. Alhassan and his co-conspirators employed these tactics until the victims either ran out of money or discovered the fraudulent nature of the scheme.  

Court records show that, in August 2017, Alhassan was stopped at the Charlotte airport with more than $130,000 in proceeds derived from the fraud. Alhassan continued to be involved in the scams even after law enforcement seized the funds, until he was arrested and charged federally for his role in the fraudulent scheme.

Alhassan is currently detained and will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility.

In making today’s announcement, U.S. Attorney Murray commended the USPIS and HSI for their investigation of this case. 

Assistant United States Attorney Jenny G. Sugar, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.

In March 2019, Andrew Murray, U.S. Attorney for the Western District of North Carolina, announced the Office’s Elder Justice Initiative, which aims to combat elder financial exploitation by expanding efforts to investigate and prosecute financial scams that target seniors; educate older adults on how to identify scams and avoid becoming victims of financial fraud; and promote greater coordination with law enforcement partners. For more information please visit: /usao-wdnc/elder-justice-initiative

CHARLOTTE, N.C. – U.S. Attorney Andrew Murray announced that Jamien Markee Marshall, 31, of Charlotte, was ordered to serve seven years in prison and three years of supervised release for illegally possessing a firearm. U.S. District Judge Max O. Cogburn Jr. handed down the sentence today, which included sentencing guideline enhancements for Marshall’s two prior armed robbery convictions and the obliterated serial number on the firearm.

According to filed court documents and the sentencing hearing, on March 26, 2019, Charlotte-Mecklenburg Police Department (CMPD) officers patrolling L.C. Coleman Park in Charlotte observed Marshall’s parked vehicle. When officers approached Marshall, who was sitting in the driver’s seat, Marshall informed the officers that there was a firearm in the vehicle.  The officers observed the firearm in between the driver’s seat and the center console.  Over the course of the investigation, officers determined that the firearm was loaded and the serial number had been rubbed off the gun.  On March 2, 2020, Marshall pleaded guilty to possession of a firearm by a felon. Marshall has two prior Robbery with a Dangerous Weapon convictions in Mecklenburg County, and he is prohibited from possessing a firearm or ammunition.

Marshall is in federal custody. He will be transferred to the custody of the Federal Bureau of Prisons upon the designation of a federal facility.

The investigation was handled by the Bureau of Alcohol, Tobacco, Firearms and Explosives, and CMPD. Assistant United States Attorney William Bozin, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.

CHARLOTTE, N.C. – U.S. District Judge Max O. Cogburn Jr. sentenced Charles Vincent Brown, 36, of Pineville, N.C., today to 51 months in prison for credit card fraud, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. Judge Cogburn also ordered Brown to serve two years under court supervision, and to pay $237,141.41 as restitution. 

Reginald A. DeMatteis, Special Agent in Charge of the United States Secret Service, Charlotte Field Office, joins U.S. Attorney Murray in making today’s announcement.

On November 4, 2019, Brown pleaded guilty to conspiracy to commit access device fraud. A federal jury convicted Brown’s co-defendant, Robert Nathaniel Johnson III, on July 28, 2020, of conspiracy to commit access device fraud and access device fraud for his role in the fraudulent scheme.

According to filed court documents and today’s sentencing hearing, from September 29, 2018, to October 20, 2018, Brown, Johnson and others used a stolen credit card number to create counterfeit credit cards, which they then used to purchase more than $250,000 of merchandise.  According to court records, Brown and Johnson stole the credit card number of an individual identified as Victim #1, whose credit card had a credit limit of $300,000. The co-conspirators created counterfeit credit cards bearing the defendants’ names and the names of other co-conspirators, and used them at multiple retail stores, including at Best Buy, Foot Action, Foot Locker, and Neiman Marcus.

According to court records, Secret Service agents executed a search warrant at Brown’s apartment, and seized more than 560 pairs of high-end sneakers and other footwear, electronics, clothing, gaming equipment, and other items Brown had purchased using the counterfeit credit cards. Agents also seized computers, an embosser, a laminator, and other items used to manufacture counterfeit credit cards and fake identity documents. Court records show that a forensic examination of Brown’s seized cell phones revealed text messages from Brown advising other individuals on how to purchase stolen credit card information, screenshots of dark web searches for stolen credit card information, and receipts for the purchase of dozens of stolen credit card numbers.

Brown is currently in federal custody. A sentencing date for Johnson has not been set.

In making today’s announcement, U.S. Attorney Murray thanked the U.S. Secret Service for their investigation of this case.

Assistant U.S. Attorney Caryn Finley, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.

A member of the North Carolina House of Representatives pleaded guilty today to making a false statement to a bank and failing to file an income tax return.

David R. Lewis, 49, of Dunn, North Carolina, pleaded guilty to one count of making a false statement to a bank and one count of failing to file a tax return before U.S. Magistrate Judge David S. Cayer of the Western District of North Carolina.  A sentencing hearing will be set at a later date.

According to documents filed with the court, Lewis has served as a Representative in the North Carolina House of Representatives since 2002, representing District 53.  Lewis also owned and operated Lewis Farms, a farming corporation in North Carolina.

On or about Aug. 1, 2018, Lewis opened a bank account in the name of “NC GOP, Inc.”  In completing the application to open the account, Lewis falsely certified to the bank that NC GOP Inc. was a corporation formed in North Carolina, of which Lewis was president.  In fact, NC GOP Inc. was not a legal entity registered in North Carolina or in any other state.  Lewis then used the NC GOP Inc. bank account to misappropriate campaign funds by disguising transfers from his campaign account to the NC GOP Inc. account as lawful contributions to the North Carolina Republican Party (commonly called the NCGOP).  NC GOP Inc. had no actual association to the North Carolina Republican Party. 

To that end, on or about July 31, 2018, Lewis caused a check to be written in the amount of $50,000 from his campaign account, made payable to NCGOP.  Lewis caused this $50,000 expenditure to be reported to the North Carolina Board of Elections as a lawful contribution to the North Carolina Republican Party.  Rather than sending the check to the North Carolina Republican Party, however, Lewis deposited the check into the NC GOP Inc. bank account immediately after opening the account on Aug. 1, 2018.  The same day, Lewis transferred the majority of the funds in the NC GOP, Inc. account to his bank account for Lewis Farms, and used the remainder to pay rent on his residence.

Additionally, on or about Aug. 15, 2018, Lewis purchased a cashier’s check in the amount of $15,000 from his campaign account, made payable to NC GOP Inc.  Lewis caused this $15,000 expenditure to be reported as a lawful contribution to the North Carolina Republican Party.  That same day, however, rather than sending the check to the North Carolina Republican Party, Lewis deposited the check into the NC GOP Inc. account and subsequently transferred the funds to his bank account for Lewis Farms.

At a later date, Lewis made two contributions in the amount of $50,000 and $15,000 to the North Carolina Republican Party from one of his personal bank accounts.  After using the NC GOP Inc. account to conduct the transactions described above, Lewis closed the account.

Lewis also admitted to willfully failing to file a tax return for calendar year 2018.

This case was investigated by the FBI and IRS-Criminal Investigation. Trial Attorneys Erica O’Brien Waymack and James C. Mann of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorneys William T. Stetzer and Dana O. Washington of the U.S. Attorney’s Office for the Western District of North Carolina are prosecuting the case.

The year 2020 marks the 150th anniversary of the Department of Justice.  Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.

CHARLOTTE, N.C. – A member of the North Carolina House of Representatives pleaded guilty today to making a false statement to a bank and failing to file an income tax return, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.

David R. Lewis, 49, of Dunn, North Carolina, pleaded guilty to one count of making a false statement to a bank and one count of failing to file a tax return before U.S. Magistrate Judge David S. Cayer of the Western District of North Carolina.  A sentencing hearing will be set at a later date.

According to documents filed with the court, Lewis has served as a Representative in the North Carolina House of Representatives since 2002, representing District 53.  Lewis also owned and operated Lewis Farms, a farming corporation in North Carolina.

On or about Aug. 1, 2018, Lewis opened a bank account in the name of “NC GOP, Inc.”  In completing the application to open the account, Lewis falsely certified to the bank that NC GOP Inc. was a corporation formed in North Carolina, of which Lewis was president.  In fact, NC GOP Inc. was not a legal entity registered in North Carolina or in any other state.  Lewis then used the NC GOP Inc. bank account to misappropriate campaign funds by disguising transfers from his campaign account to the NC GOP Inc. account as lawful contributions to the North Carolina Republican Party (commonly called the NCGOP).  NC GOP Inc. had no actual association to the North Carolina Republican Party. 

To that end, on or about July 31, 2018, Lewis caused a check to be written in the amount of $50,000 from his campaign account, made payable to NCGOP.  Lewis caused this $50,000 expenditure to be reported to the North Carolina Board of Elections as a lawful contribution to the North Carolina Republican Party.  Rather than sending the check to the North Carolina Republican Party, however, Lewis deposited the check into the NC GOP Inc. bank account immediately after opening the account on Aug. 1, 2018.  The same day, Lewis transferred the majority of the funds in the NC GOP, Inc. account to his bank account for Lewis Farms, and used the remainder to pay rent on his residence.

Additionally, on or about Aug. 15, 2018, Lewis purchased a cashier’s check in the amount of $15,000 from his campaign account, made payable to NC GOP Inc.  Lewis caused this $15,000 expenditure to be reported as a lawful contribution to the North Carolina Republican Party.  That same day, however, rather than sending the check to the North Carolina Republican Party, Lewis deposited the check into the NC GOP Inc. account and subsequently transferred the funds to his bank account for Lewis Farms.

At a later date, Lewis made two contributions in the amount of $50,000 and $15,000 to the North Carolina Republican Party from one of his personal bank accounts.  After using the NC GOP Inc. account to conduct the transactions described above, Lewis closed the account.

Lewis also admitted to willfully failing to file a tax return for calendar year 2018.

This case was investigated by the FBI in Charlotte and IRS-Criminal Investigation. Trial Attorneys Erica O’Brien Waymack and James C. Mann of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorneys William T. Stetzer and Dana O. Washington of the U.S. Attorney’s Office for the Western District of North Carolina are prosecuting the case.

The year 2020 marks the 150th anniversary of the Department of Justice.  Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.

CHARLOTTE, N.C. – Markuetric Stringfellow, 37, of Powder Springs, Georgia, appeared in court today and pleaded guilty to federal conspiracy charges filed in the U.S. District Courts in North and South Carolina, for defrauding the states’ Medicaid programs, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina, and U.S. Attorney Peter M. McCoy, of the U.S. Attorney’s Office for the District of South Carolina. U.S. Magistrate Judge David S. Cayer presided over today’s plea hearing.

The North Carolina Scheme

According to filed plea documents and today’s plea hearing, Stringfellow was a resident of Charlotte and Greensboro, North Carolina, and a partner in Everlasting Vitality, LLC (EV) and Do-It-4-The Hood Corporation (D4H). D4H operated after-school programs in Charlotte, Greensboro, Winston-Salem, and Rocky-Mount, North Carolina, among others. Beginning in or about January 7, 2016, and continuing through November 12, 2018, Stringfellow and his co-conspirators executed a conspiracy to defraud the North Carolina Medicaid program by soliciting illegal kickbacks from various drug testing laboratories, in exchange for referrals of North Carolina Medicaid beneficiaries obtained through the after-school programs operated by EV and D4H.

According to court documents, Stringfellow and his co-conspirators paid individuals to recruit at-risk youths, in particular children who were Medicaid eligible, for EV’s or D4H’s after-school and youth mentoring programs. Once enrolled, children were required to submit urine specimens for drug testing. Stringfellow and his co-conspirators conspired with certain laboratories to perform the drug testing of the urine specimens submitted in the names of children enrolled at EV and D4H, and received kickbacks after the laboratories were reimbursed by the North Carolina Medicaid.

In addition to the kickback scheme, Stringfellow and his conspirators devised a scheme to defraud North Carolina Medicaid by referring clients to laboratories which they knew would file fraudulent claims and receive reimbursement based on drug testing services that did not meet the drug testing policy requirements. For example, on some occasions, Stringfellow and his co-conspirators obtained personal identifying information (PII) of D4H clients, such as names, addresses, dates of birth, and Medicaid beneficiary numbers, which they provided to drug testing laboratories. In turn, the laboratories used D4H clients’ PII to submit drug testing claims to the North Carolina Medicaid that were fraudulent because, among other reasons, the drug tests were not medically necessary, or the urine specimens were not of the Medicaid beneficiaries under whose names they were submitted. Once North Carolina Medicaid paid the fraudulent claims submitted by the testing laboratories for these unauthorized and medically unnecessary drug tests, the labs then paid companies under the control of Stringfellow and others, at an agreed percentage of their Medicaid reimbursement.

The South Carolina Scheme

In addition to executing a fraudulent scheme in North Carolina, Stringfellow has admitted to defrauding the South Carolina Medicaid program. According to the bill of information and documents filed with the U.S. District Court in South Carolina, Stringfellow was a franchise owner of Wrights Care Services LLC (Wrights Care), a qualified provider of Medicaid rehabilitative behavioral health services in South Carolina.  Wrights Care was located at 1320 Main Street, in Columbia, South Carolina, and maintained separate franchise locations throughout South Carolina, including in Spartanburg, Pickens, Cheraw, Society Hill, Bennettsville, Hartsville, and Conway. In April 2014, Wrights Care became a participating provider in the South Carolina Medicaid program, which allowed Wrights Care to submit claims for behavioral mentoring services reimbursable under Medicaid. 

Starting in or around 2014, Stringfellow and his co-conspirators defrauded the South Carolina Medicaid program by filing fraudulent claims for services that were either not provided, partially provided, or did not qualify for reimbursement.  According to court records, to support the fraudulent reimbursement claims filed with the South Carolina Medicaid, Stringfellow and his co-conspirators submitted falsified patient billing records and fake medical notes. Furthermore, court records show that after learning there was a Medicaid audit for Wrights Care, Stringfellow and his co-conspirators attempted to deceive South Carolina Medicaid auditors. In or about March 2015, Stringfellow met other associates of Wrights Care in Columbia for a “note party,” during which the co-conspirators created false and fraudulent billing records to substantiate previously-submitted fraudulent Medicaid claims, forged signatures, and falsified records subject to the audit, which they then submitted to South Carolina Medicaid auditors in response to the audit.

Stringfellow pleaded guilty today to two counts of conspiracy to commit Medicaid fraud. The South Carolina case will be transferred to the U.S. District Court for the Western District of North Carolina. Each conspiracy charge carries a maximum sentence of five years in prison and a $250,000 fine. A sentencing date for Stringfellow has not been set.

In making today’s announcement U.S. Attorney Murray and U.S. Attorney McCoy commended the investigative work of the FBI field offices in Charlotte, Columbia and Atlanta, and the Medicaid Investigation Divisions in Raleigh, Columbia and Atlanta, and thanked the U.S. Attorney’s Office for the Northern District of Georgia for their assistance and coordination.

Assistant U.S. Attorneys Michael Savage in Charlotte and Brook Andrews in Columbia are prosecuting the case.

CHARLOTTE, N.C. – Dino Crnalic, 33, of Charlotte, appeared in federal court today following his arrest on Friday, August 21, 2020, for various fraud schemes that defrauded the U.S. Small Business Administration (SBA) and others of more than $800,000, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. U.S. Magistrate Judge David S. Cayer presided over the hearing. The alleged fraud schemes involved Crnalic’s efforts to open a sushi restaurant and fitness center near Uptown Charlotte.

According to allegations contained in the indictment, from July 2017 through at least November 2019, Crnalic executed multiple fraudulent schemes and obtained more than $800,000 in SBA-backed loans from various federally insured financial institutions and from other entities. As alleged in the indictment, Crnalic secured the SBA-backed loans by submitting fraudulent documents, including fraudulent applications and fake supporting documentation, and by making various false statements. As part of his fraudulent schemes, the indictment alleges that Crnalic also stole the identity of at least one individual identified in court documents as C.P., and used various falsified documents in C.P.’s name, including a falsified United States Passport. According to the indictment, Crnalic fraudulently obtained more than $800,000 through his schemes, which he used for, among other things, personal expenses, including trips to various casinos, and attempted to obtain hundreds of thousands of dollars.

The indictment alleges that, during the relevant time period, Crnalic formed various business entities doing business in the Charlotte area that he controlled, including Suki Sushi LLC (Suki), Suki Akor LLC (Akor) and Surge Fitness Centers, LLC (Surge). As alleged in the indictment, by no later than the summer of 2016, Crnalic began the process of opening a new sushi restaurant in uptown Charlotte named Suki Akor. As part of that process, Crnalic applied for a loan with a financial institution in the name of Suki, through the SBA 7(a) Loan Guaranty Program. Under this program, the SBA does not loan money directly to small businesses, but provides guaranty to the lending financial institutions that the SBA will repay a percentage of a qualified loan in the event that a borrower defaults.

In applying for the loan with the financial institution for an SBA-backed loan, and obtaining the loan disbursements, the indictment alleges that Crnalic submitted numerous fraudulent documents and made various false statements, including that C.P. was a partner in Suki, when in fact C.P. had nothing to do with Suki or the Suki Akor restaurant. Crnalic also submitted fake invoices for construction costs at the restaurant, fraudulent operating agreements bearing C.P.’s forged signature, falsified bank statements, and fraudulent loan applications. Furthermore, as alleged in the indictment, Crnalic sent and received emails using an email address purportedly belonging to C.P., when in fact Crnalic controlled the email address.

The indictment alleges that, contrary to promises Crnalic made to the financial institution that provided the loan, Crnalic spent a portion of the loan proceeds to cover personal expenses, including to gamble, pay rent on an apartment in Uptown Charlotte, make a car payment on a luxury vehicle, and make purchases at restaurants and bars throughout North Carolina, Florida and in Las Vegas.

According to allegations in the indictment, on or around January 2018, Crnalic applied for an SBA line of credit in the name of Suki through the same financial institution. As with a previous loan application, Crnalic submitted fraudulent loan documents that contained, among other things, forged signatures for C.P., some of which had been notarized through the use of a falsified United States Passport in C.P’s name. Based on the fraudulent documentation, Crnalic was able to obtain an SBA-guaranteed line of credit loan through the financial institution. Contrary to his representations about how the proceeds would be used, Crnalic used a portion of the proceeds for personal use, including to fund a trip to Harrah’s casino in New Orleans.

As alleged in the indictment, in or around March 2018, Crnalic opened up a restaurant in uptown Charlotte named Suki Akor. By no later than May 2018, the restaurant closed, and it ceased operations permanently. At the time of its closing, the indictment alleges that Suki and Akor had hundreds of thousands of dollars in unpaid obligations in addition to the SBA-backed loans from the financial institution, most of which were never paid.

According to allegations in the indictment, by no later than the fall of 2018, Crnalic began the process of opening Surge, a new fitness center located near Uptown Charlotte, and applied for a $250,000 business loan with another financial institution. As with the previous restaurant scheme, Crnalic submitted numerous fraudulent documents and made various false statements while attempting to obtain the loan, including making false statements about the business and C.P.’s involvement. When the financial institution requested to meet with Crnalic and C.P. to discuss the loan further, the indictment alleges that Crnalic stopped pursuing the loan. Also in connection with his efforts to open Surge, Crnalic used C.P.’s identity and other falsified documents to finance $47,473 in fitness equipment through an equipment financing company headquartered in Alexandria, Minnesota. As alleged in the indictment, Surge ultimately defaulted on the lease agreement with the company.

Crnalic is charged with two counts of financial institution fraud, which carry a maximum sentence of 30 years in prison and a $1,000,000 fine per count; three counts of aggravated identity theft, which carry a mandatory sentence of two years in prison per count, consecutive to any other sentence imposed; concealment money laundering, which carries a maximum prison term of 20 years and a $500,000 fine; making a false statements to a bank in connection with a loan, which carries a maximum prison sentence of 30 years and a $1,000,000 fine; and wire fraud, which carries a maximum prison term of 20 years and a $250,000 fine. The indictment also contains a forfeiture money judgment in the amount of at least $845,000, such amount constituting the fraudulent proceeds of the loan scheme.

The charges contained in the indictment are allegations. The defendant is innocent until proven guilty beyond reasonable doubt in a court of law.

In making today’s announcement, U.S. Attorney Murray credited the Charlotte Division of the FBI the SBA’s Office of the Inspector General for the investigation of this case.

Assistant U.S. Attorney Daniel Ryan, of the U.S. Attorney’s Office in Charlotte, is prosecuting the case.

If you believe you are a victim or have information related to this case, please contact the FBI at 704-672-6100, and select option 2 when prompted.

The founder and chairman of a multinational investment company and a company consultant were sentenced to prison today for orchestrating a bribery scheme involving independent expenditure accounts and improper campaign contributions. 

Greg E. Lindberg, 50, of Durham, North Carolina, the founder and chairman of Eli Global LLC (Eli Global) and the owner of Global Bankers Insurance Group (GBIG), was sentenced to 87 months in prison and three years of supervised release.  Lindberg’s consultant, John D. Gray, 70, of Chapel Hill, North Carolina, was ordered to serve 30 months in prison, followed by two years of supervised release.  Lindberg and Gray were also ordered to pay forfeiture in the amount approximately $1.45 million held in accounts established by the defendants for the purpose of funneling the bribe payments.

On March 5, 2020, a federal jury convicted Lindberg and Gray of conspiracy to commit honest services wire fraud and bribery concerning programs receiving federal funds following an approximately three-week trial.  U.S. District Judge Max O. Cogburn Jr. presided over the trial and today’s sentencing hearings.

Co-defendant, Robert Cannon Hayes, 74, of Concord, North Carolina, was also sentenced today to a one-year probationary term.  Hayes previously pleaded guilty to making false statements to the FBI and agreed to cooperate with the government’s investigation.

“When Greg Lindberg and John Gray offered millions of dollars in bribes to the North Carolina Insurance Commissioner, they referred to their elaborately corrupt scheme as a ‘win-win’ – unaware that the FBI was watching and listening,” said Acting Assistant Attorney General Brian C. Rabbitt of the Justice Department’s Criminal Division.  “Today, both men have been held accountable for their crimes, and their sentences underscore the Department of Justice's unyielding commitment to rooting out corruption wherever we find it.”

“Lindberg and his accomplices, driven by greed, devised an extensive political bribery scheme to illegally funnel millions of dollars to an elected official for the benefit of Lindberg’s business interests.  To this day, Lindberg and Gray remain unremorseful and refuse to accept responsibility for their criminal actions.  The severity of their brazen conduct is reflected in the Court’s sentence,” said U.S. Attorney Andrew Murray for the Western District of North Carolina.  “Bribery of a public official is far from a victimless crime.  It is our duty to the American people to stop bad actors with deep pockets and unscrupulous intentions from wrecking the foundation on which this country proudly stands.  To those that greedily seek to line their own pockets through deceit and fraud, I offer the following advice: Keep a travel toothbrush handy.”

“When the prison bars close behind Mr. Lindberg and Mr. Gray, they will hear the sound of justice, loud and clear,” said Special Agent in Charge John Strong of the FBI’s Charlotte Field Office.  “The FBI will root out any and all forms of public corruption.  We remain committed to ensuring those who attempt to interfere with the integrity of our democratic process pay the price.”

According to filed court documents, evidence presented at trial, and today’s sentencing hearings, in January 2018, the elected Commissioner (Commissioner) of the North Carolina Department of Insurance (NCDOI) reported concerns to the FBI about political contributions and other requests made by Lindberg and Gray, and agreed to cooperate with the federal investigation that was initiated. 

According to evidence presented at trial, from April 2017 to August 2018, Lindberg and Gray engaged in a bribery scheme involving independent expenditure accounts and improper campaign contributions for the purpose of causing the Commissioner to take official action favorable to Lindberg’s company, GBIG.  Trial evidence established that Lindberg and Gray gave, offered, and promised the Commissioner millions of dollars in campaign contributions and other things of value, in exchange for the removal of NCDOI’s Senior Deputy Commissioner, who was responsible for overseeing regulation and the periodic examination of GBIG. 

According to trial evidence, Lindberg, Gray and the Commissioner held numerous in-person meetings at different locations, including in Statesville, North Carolina, and had telephonic and other communications with each other, and others, to discuss Lindberg’s request for the personnel change in exchange for millions of dollars, and to devise a plan on how to funnel campaign contributions to the Commissioner anonymously.  In order to conceal the bribery scheme, at the direction of Lindberg, two corporate entities were set-up to form an independent expenditure committee with the purpose of supporting the Commissioner’s re-election campaign, and Lindberg funded the entities with $1.5 million as promised to the Commissioner.  In addition, at Lindberg and Gray’s direction, Hayes caused the transfer of $250,000 from monies Lindberg had previously contributed to a North Carolina state party of which Hayes was chairman, to the Commissioner’s re-election campaign.

According to admissions Hayes made in connection with his guilty plea, on or about Aug. 28, 2018, Hayes falsely stated to FBI agents that he had never spoken with the NCDOI Commissioner about personnel or personnel problems at NCDOI, or about Lindberg or Gray.  Hayes further admitted that, at the time he made the materially false statements, Hayes knew that it was unlawful to lie to the FBI, and knew that his statements were false because Hayes had in fact spoken with the NCDOI Commissioner about Lindberg and Gray, and about Lindberg’s request that the Commissioner move certain personnel within NCDOI.  

The FBI’s Charlotte field office investigated the case.

Trial Attorney James C. Mann of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorneys William T. Stetzer and Dana O. Washington of the U.S. Attorney’s Office for the Western District of North Carolina prosecuted the case.

The year 2020 marks the 150th anniversary of the Department of Justice.  Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.

CHARLOTTE, N.C. – The founder and chairman of a multinational investment company and a company consultant were sentenced to prison today for orchestrating a bribery scheme involving independent expenditure accounts and improper campaign contributions. 

Greg E. Lindberg, 50, of Durham, North Carolina, the founder and chairman of Eli Global LLC (Eli Global) and the owner of Global Bankers Insurance Group (GBIG), was sentenced to 87 months in prison and three years of supervised release.  Lindberg’s consultant, John D. Gray, 70, of Chapel Hill, North Carolina, was ordered to serve 30 months in prison, followed by two years of supervised release.  Lindberg and Gray were also ordered to pay forfeiture in the amount approximately $1.45 million held in accounts established by the defendants for the purpose of funneling the bribe payments.

On March 5, 2020, a federal jury convicted Lindberg and Gray of conspiracy to commit honest services wire fraud and bribery concerning programs receiving federal funds following an approximately three-week trial.  U.S. District Judge Max O. Cogburn Jr. presided over the trial and today’s sentencing hearings.

Co-defendant, Robert Cannon Hayes, 74, of Concord, North Carolina, was also sentenced today to a one-year probationary term.  Hayes previously pleaded guilty to making false statements to the FBI and agreed to cooperate with the government’s investigation.

“When Greg Lindberg and John Gray offered millions of dollars in bribes to the North Carolina Insurance Commissioner, they referred to their elaborately corrupt scheme as a ‘win-win’ – unaware that the FBI was watching and listening,” said Acting Assistant Attorney General Brian C. Rabbitt of the Justice Department’s Criminal Division.  “Today, both men have been held accountable for their crimes, and their sentences underscore the Department of Justice's unyielding commitment to rooting out corruption wherever we find it.”

“Lindberg and his accomplices, driven by greed, devised an extensive political bribery scheme to illegally funnel millions of dollars to an elected official for the benefit of Lindberg’s business interests.  To this day, Lindberg and Gray remain unremorseful and refuse to accept responsibility for their criminal actions.  The severity of their brazen conduct is reflected in the Court’s sentence,” said U.S. Attorney Andrew Murray for the Western District of North Carolina.  “Bribery of a public official is far from a victimless crime.  It is our duty to the American people to stop bad actors with deep pockets and unscrupulous intentions from wrecking the foundation on which this Country proudly stands.  To those that greedily seek to line their own pockets through deceit and fraud, I offer the following advice: Keep a travel toothbrush handy.”

“When the prison bars close behind Mr. Lindberg and Mr. Gray, they will hear the sound of justice, loud and clear,” said Special Agent in Charge John Strong of the FBI’s Charlotte Field Office.  “The FBI will root out any and all forms of public corruption.  We remain committed to ensuring those who attempt to interfere with the integrity of our democratic process pay the price.”

According to filed court documents, evidence presented at trial, and today’s sentencing hearings, in January 2018, the elected Commissioner (Commissioner) of the North Carolina Department of Insurance (NCDOI) reported concerns to the FBI about political contributions and other requests made by Lindberg and Gray, and agreed to cooperate with the federal investigation that was initiated. 

According to evidence presented at trial, from April 2017 to August 2018, Lindberg and Gray engaged in a bribery scheme involving independent expenditure accounts and improper campaign contributions for the purpose of causing the Commissioner to take official action favorable to Lindberg’s company, GBIG.  Trial evidence established that Lindberg and Gray gave, offered, and promised the Commissioner millions of dollars in campaign contributions and other things of value, in exchange for the removal of NCDOI’s Senior Deputy Commissioner, who was responsible for overseeing regulation and the periodic examination of GBIG. 

According to trial evidence, Lindberg, Gray and the Commissioner held numerous in-person meetings at different locations, including in Statesville, North Carolina, and had telephonic and other communications with each other, and others, to discuss Lindberg’s request for the personnel change in exchange for millions of dollars, and to devise a plan on how to funnel campaign contributions to the Commissioner anonymously.  In order to conceal the bribery scheme, at the direction of Lindberg, two corporate entities were set-up to form an independent expenditure committee with the purpose of supporting the Commissioner’s re-election campaign, and Lindberg funded the entities with $1.5 million as promised to the Commissioner.  In addition, at Lindberg and Gray’s direction, Hayes caused the transfer of $250,000 from monies Lindberg had previously contributed to a North Carolina state party of which Hayes was chairman, to the Commissioner’s re-election campaign.

According to admissions Hayes made in connection with his guilty plea, on or about Aug. 28, 2018, Hayes falsely stated to FBI agents that he had never spoken with the NCDOI Commissioner about personnel or personnel problems at NCDOI, or about Lindberg or Gray.  Hayes further admitted that, at the time he made the materially false statements, Hayes knew that it was unlawful to lie to the FBI, and knew that his statements were false because Hayes had in fact spoken with the NCDOI Commissioner about Lindberg and Gray, and about Lindberg’s request that the Commissioner move certain personnel within NCDOI.  

The FBI’s Charlotte field office investigated the case.

Trial Attorney James C. Mann of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorneys William T. Stetzer and Dana O. Washington of the U.S. Attorney’s Office for the Western District of North Carolina prosecuted the case.

The year 2020 marks the 150th anniversary of the Department of Justice.  Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.

CHARLOTTE, N.C. – U.S. Attorney Andrew Murray announced that Takobie Anderson, 20, of Charlotte, was sentenced in federal court late yesterday for illegally possessing a firearm. U.S. District Judge Frank D. Whitney ordered Anderson to serve 82 months in prison, followed by two years of supervised release.

U.S. Attorney Murray is joined in making today’s announcement by Vincent C. Pallozzi, Special Agent in Charge of the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Charlotte Field Division, and Chief Johnny Jennings of the Charlotte Mecklenburg Police Department (CMPD).

According to filed court documents and yesterday’s sentencing hearing, on April 21, 2019, CMPD officers were dispatched to an apartment complex in Charlotte, in response to a report of a shooting.  When the officers arrived at the scene they determined that two individuals, a male and a female, had been shot and had sustained injuries. Over the course of the investigation, law enforcement determined that Anderson had shot the two victims following a verbal altercation between the victims and a relative of Anderson. Court records show that, at the time of the shooting, Anderson was on probation for a state conviction and was wearing an ankle monitor. Law enforcement arrested Anderson on August 23, 2019, at a residence in Charlotte. At the time of Anderson’s arrest, law enforcement located inside the residence a loaded firearm, which they later determined had been stolen and was the firearm Anderson had used to shoot the victims. According to court records, Anderson has a previous felony conviction and he is prohibited from possessing a firearm and/or ammunition.

Anderson is in federal custody. He will be transferred to the custody of the Federal Bureau of Prisons upon the designation of a federal facility.

The investigation was handled by the ATF and CMPD. The case was prosecuted by Assistant United States Attorney Caryn Finley of the U.S. Attorney’s Office in Charlotte.

CHARLOTTE, N.C. – U.S. District Judge Frank D. Whitney sentenced to prison the leader of a methamphetamine trafficking ring and his two co-conspirators today, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. 

William Andrew Reel, II, 40, of Bessemer City, N.C., was ordered to serve 30 years in prison and five years of supervised release. Reel pleaded guilty to drug conspiracy and possession with intent to distribute methamphetamine.

Kateland Dawn Myers, 25, of Bessemer City, N.C., was sentenced to 151 months in prison, followed by five years of supervised release. Myers pleaded guilty to drug conspiracy and distribution and possession with intent to distribute methamphetamine.

Matthew Lloyd Thomas, 32, of Dallas, N.C. was ordered to serve 151 months in prison, and five years of supervised release. Thomas previously pleaded guilty to drug conspiracy, distribution and possession with intent to distribute methamphetamine, and possession of a firearm by a felon.

According to filed court documents and today’s sentencing hearings, from at least September 2018 to March 2019, Reel conspired with others to traffic large quantities of methamphetamine from Georgia into North Carolina, which Reel, Myers, and Thomas then distributed locally in Gaston County and elsewhere. Court records show that Reel, assisted by Myers and Thomas, was responsible for trafficking at least 30 kilograms of methamphetamine. Over the course of the investigation law enforcement seized methamphetamine, three firearms, and more than $ 64,171 in drug proceeds.

In making the announcement, U.S. Attorney Murray thanked the DEA and the Gaston County Police Department for handling the investigation. 

Assistant U.S. Attorney Christopher Hess, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.

ASHEVILLE, N.C. – U.S. Attorney Andrew Murray announced that on Thursday, August 13, 2020, Mark Colin Ramsey, 50, of Graham, N.C., was sentenced to 65 months in prison for operating a $1.1 million investment scheme. U.S. District Judge Martin Reidinger also ordered Ramsey to serve three years of supervised release and to pay restitution in the amount of $1,098,333.92.

North Carolina Secretary of State Elaine F. Marshall joins U.S. Attorney Murray in making today’s announcement.

According to filed court documents and statements made in court, from April 2008 to September 2013, Ramsey defrauded more than 20 victims out of nearly $1.1 million through a fraudulent investment scheme.  Court records show that Ramsey operated various purported investment companies, including Hypertrend, Cascade Investments, GH Gardner, Layton-McCall, Pandrox, and Good Living. Ramsey induced victim-investors by falsely representing that their money would be used to make legitimate investments. He also promised his victims that they would receive a guaranteed return on their investments, and that their principal investments would not be at risk. During the relevant time period, Ramsey used multiple purported investment corporations, as well as numerous fraudulent documents, including false Form-1099s, fake investment agreements, and fabricated stock certificates, to convince potential victims his investments were legitimate and profitable. To further induce victims, court records reflect that Ramsey showed potential investors documents purportedly backing up his claim that he had made one million dollars from a ten thousand dollar investment.

According to court records, Ramsey failed to disclose to his victims, some of whom were at or near retirement age, that he was not registered to sell securities in the State of North Carolina, or that the investment opportunities he presented were not registered as required by statute. Rather than invest the victims’ money as promised, Ramsey spent the investors’ money on Ponzi-style payments to other investors and to fund his personal lifestyle.

On August 26, 2019, Ramsey pleaded guilty to securities fraud. In making today’s announcement, U.S Attorney Murray thanked the Securities Division of the North Carolina Department of the Secretary of State for their investigation of this case.

Assistant U.S. Attorney Daniel Bradley, of the U.S. Attorney’s Office in Asheville, prosecuted the case.

In March 2019, Andrew Murray, U.S. Attorney for the Western District of North Carolina, announced the Office’s Elder Justice Initiative, which aims to combat elder financial exploitation by expanding efforts to investigate and prosecute financial scams that target seniors; educate older adults on how to identify scams and avoid becoming victims of financial fraud; and promote greater coordination with law enforcement partners. For more information please visit: /usao-wdnc/elder-justice-initiative

CHARLOTTE, N.C. – Braudio Mendoza, 33 of Atlanta, Georgia, was sentenced to 235 months in prison and five years of supervised release late yesterday for trafficking methamphetamine, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. 

According to court records, from at least as early as 2018 to March 2019, Mendoza was involved in a drug conspiracy that trafficked large quantities of methamphetamine from Georgia into Western North Carolina.  Court records show that law enforcement identified Mendoza as a source of supply of the methamphetamine, and he coordinated drug deliveries into North Carolina. Over the course of the investigation, law enforcement determined that Mendoza was responsible for trafficking more than 4.5 kilograms of high-purity methamphetamine, also known as “ice”.  

On February 22, 2019, Mendoza pleaded guilty to two counts of possession with intent to distribute methamphetamine.  He is currently in federal custody and will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility. 

\Mendoza was charged as part of an ongoing Organized Crime Drug Enforcement Task Force (OCDETF) investigation codenamed “Dixie Crystal.”  Since 2015, more than 200 individuals have been prosecuted as a result of the Dixie Crystal investigation, and the drug trafficking organizations involved have trafficked methamphetamine worth millions of dollars.  Over the course of the investigation, law enforcement have seized far in excess of 20 kilograms of crystal methamphetamine, $500,000 in U.S. currency and other assets, and dozens of firearms. 

\OCDETF is a joint federal, state and local cooperative approach to combat drug trafficking and is the nation’s primary tool for disrupting and dismantling major drug trafficking organizations, targeting national and regional drug trafficking organizations and coordinating the necessary law enforcement entities and resources to disrupt or dismantle the targeted criminal organization and seize their assets.

Mendoza’s case was investigated by the ICE-Homeland Security Investigations, with assistance from the North Carolina State Bureau of Investigation, Gastonia Police Department, Gaston County Police Department, Huntersville Police Department, Mooresville Police Department, Cleveland County Sheriff’s Office, Alexander County Sheriff’s Office, Davie County Sheriff’s Office, Mocksville Police Department, and the Charlotte-Mecklenburg Police Department.  Assistant U.S. Attorney Steven Kaufman prosecuted the case.

CHARLOTTE, N.C. – On Monday, August 10, 2020, U.S. District Judge Frank D. Whitney sentenced Jeremy McQuage, 41, of Morven, N.C. to 160 months in prison on child pornography charges, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.  Morven was also ordered to serve a lifetime of supervised release, and to register as a sex offender after he completes his prison term.

Joining U.S. Attorney Murray in making today’s announcement is John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division. 

On December 18, 2019, McQuage pleaded guilty to distribution, receipt and possession of child pornography. According to court documents and today’s sentencing hearing, in February 2019, over the course of an investigation into BitTorrent peer-to-peer file sharing network, the FBI discovered that an individual, later identified as McQuage, was downloading child pornography, including videos and images of infants being sexually abused. On March 14, 2019, the FBI executed a search warrant at the residence where the internet had been used to access and download the child pornography. While there, FBI agents learned that McQuage did not reside there but would often park in the driveway of the residence and use the wifi to connect to the internet. FBI agents located McQuage and seized his cellular phone. A forensic analysis of the device revealed that McQuage possessed hundreds of images and videos of children, including infants and toddlers, being sexually abused. According to court records, in addition to downloading child pornography, McQuage also used BitTorrent to distribute and share the child pornography with others.

In announcing today’s sentence, Judge Whitney said that the court was troubled by the quantity and the gravity of the images and videos, and that McQuage’s conduct helped feed and facilitate a global market of abuse. Judge Whitney noted that the victimization of the minors in the videos and images was extraordinary and that the lengthy sentence was needed to deter others from committing similar crimes. 

McQuage is in federal custody and will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility. 

The case was investigated by the FBI. Assistant U.S. Attorney Emily Wasserman and Special Assistant U.S. Attorney Stephanie Spaugh prosecuted the case.

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

ASHEVILLE, N.C. – Former Buncombe County Commissioner Ellen Madans Frost, 65, of Black Mountain, N.C., appeared in federal court today and pleaded guilty to conspiracy to commit federal program fraud, for her involvement in a scheme to use Buncombe County funds to sponsor equestrian activities in North Carolina and Florida, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. 

John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division; Director Robert Schurmeier of the North Carolina State Bureau of Investigation (SBI); and Matthew D. Line, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation Division, Charlotte Field Office (IRS-CI), join U.S. Attorney Murray in making today’s announcement.

According to filed court documents and today’s plea hearing, Frost was elected as Commissioner for Buncombe County (the County) in November 2012, and continued to serve until December 2018.  Beginning in early 2014 through November 2017, Frost conspired with former County Manager, Wanda Skillington Greene, to execute a scheme to defraud the County by misapplying funds allocated to the County’s Economic Development Program to support various equestrian enterprises in North Carolina and Florida, specifically, the Tryon International Equestrian Center (the Tryon Center) located in Polk County, and its affiliate, the Palm Beach International Equestrian Center located in Wellington, Florida.  

According to court documents, in or about 2014, Frost began to speak with Greene about Frost’s desire to support the Tryon Center and related equestrian activities on behalf of the County.  As a result, Frost and Greene developed a scheme to enter into sponsorship and advertising contracts with the Tryon Center, the Palm Beach International Equestrian Center, and affiliated equestrian enterprises. To pay for the associated expenses, Wanda Greene proposed using monies from the County’s Economic Development Incentive Fund.  The equestrian enterprises were unaware of the criminal nature of the scheme, including the lack of authorization for Frost and Greene to enter into these negotiations and agreements without the knowledge and approval of the Board of Commissioners, as required by State law.

Greene and Frost took steps to cover the fraudulent scheme and to hide the County’s involvement in these unauthorized sponsorship and advertising contracts, by using the funds to promote the Asheville Regional Airport (the Airport), even though the Airport is an independent entity not governed or funded by the County.  In an effort to conceal the fact that the County was the funding source, Greene and Frost ensured that the contracting parties understood that all sponsored events, signage, and advertisements would bear the name and logo of the Asheville Regional Airport, and that no signage or advertisements would be in the name of Buncombe County, even though the County was the paying sponsor. 

According to court documents the County’s sponsorship contracts guaranteed access to amenities at the two equestrian venues exclusive to high-level sponsors.  Specifically, the Tryon Center contract included access to a “Members Only” VIP table in an area known as the Legends Club. Entrance to the Legends Club and use of the VIP table was limited to persons whose names were on the admission list.  Court records show that Frost ordinarily served as the contact person and approved the use of the County-funded table at the Legends Club. Furthermore, during the 2015 and 2016 seasons at the Tryon Center, Frost repeatedly used the VIP table, and invited her friends and other guests to attend the events.

Following Greene’s retirement in June 2017, County employees discovered the County’s payments to the equestrian enterprises. In August 2017, the Board of Commissioners learned of the number and amounts of these payments, when the new County Manager informed the Board of the payments county employees had discovered. 

Following her plea hearing, Frost was released on bond. The federal program fraud conspiracy charge carries a maximum penalty of five years in prison.  A sentencing date for Frost has not been set.

In making today’s announcement U.S. Attorney Murray commended the FBI, IRS-CI and the SBI for their investigation of this case.

Assistant United States Attorneys Richard Edwards and Don Gast of the U.S. Attorney’s Office in Asheville are prosecuting the case.

CHARLOTTE, N.C. – U.S. Attorney Andrew Murray announced today that Travis Justin Stout, 36, of Hickory, N.C., was sentenced to 108 months in prison and three years of supervised release for drug trafficking conspiracy and possession with intent to distribute narcotics on the Dark Web. The sentencing was held on Thursday, August 6, 2020.

Ronnie Martinez, Special Agent in Charge of ICE/Homeland Security Investigations (HSI) in Georgia and the Carolinas, Tommy D. Coke, Inspector in Charge of the Atlanta Division of the U.S. Postal Inspection Service, which oversees Charlotte, and Chief Thurman Whisnant of the Hickory Police Department join U.S. Attorney Murray in making today’s announcement.

According to information contained in filed court documents and the sentencing hearing, in 2016, law enforcement began investigating Stout for trafficking narcotics in the greater Hickory area.  Over the course of the investigation, law enforcement determined that Stout was purchasing narcotics, including MDMA (Ecstasy), methamphetamine, amphetamine, and marijuana, on the Dark Web, using various forms of cryptocurrency.  Court records show that Stout also used the Dark Web to traffic narcotics throughout the United States and internationally, including on the AlphaBay Market, and stored the drug proceeds in multiple virtual currency wallets. Stout trafficked narcotics from the Netherlands and Belgium, among other locations, in this conspiracy.

In handing down Stout’s sentence, Judge Bell stated this was an extremely sophisticated international drug trafficking case, involving the Dark Web, and noted this sentence will deter others from completing similar sophisticated Dark Web crimes.

Stout is currently in custody and will be transferred to the custody of the federal Bureau of Prisons.

In making today’s announcement U.S. Attorney Murray thanked HSI in Charlotte, USPIS, and the Hickory Police Department for their investigation on this case.

Assistant U.S. Attorneys Sanjeev Bhasker and Seth Johnson of the U.S. Attorney’s Office in Charlotte prosecuted the case.

CHARLOTTE, N.C. – On Thursday, August 6, 2020, U.S. District Judge Kenneth D. Bell sentenced a former teacher for receiving child pornography, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.  Christopher David Muggler, 27, of Indian Trail, N.C. was sentenced to six years in prison and 10 years of supervised release.  He was also ordered to register as a sex offender after he completes his prison term.

Joining U.S. Attorney Murray in making today’s announcement is John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division. 

On February 28, 2020, Muggler, a former teacher at Covenant Day School in Matthews, N.C., pleaded guilty to receiving child pornography.  According to filed court documents and yesterday’s sentencing hearing, FBI agents conducting an investigation into child exploitation became aware that an individual with the username “Muggadelphia12” was receiving child pornography via Dropbox links, specifically videos that depicted young male victims being sexually abused. Law enforcement linked the username “Muggadelphia12” to Muggler. On March 26, 2019, FBI agents executed a warrant at Muggler’s residence and seized Muggler’s two cell phones. At sentencing, Muggler was found to possess 110 images and 34 videos of child pornography.

Mugger is in federal custody and will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility. 

The case was investigated by the FBI.  Assistant U.S. Attorney Alfredo De La Rosa, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.

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

ASHEVILLE, N.C. – George Allan Lambert, 48, of Cherokee, N.C., and an Enrolled Member of the Eastern Band of Cherokee Indians, was sentenced to today to 45 months in prison and three years of supervised release for stabbing a victim with a knife, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. On November 5, 2019, a jury convicted Lambert of assault resulting in serious bodily injury, and assault with a dangerous weapon with intent to do bodily harm.

Chief Doug Pheasant of the Cherokee Indian Police Department (CIPD) joins U.S. Attorney Murray in making today’s announcement.

According to filed documents, evidence presented at trial and witness testimony, on May 2, 2019, Lambert and the victim were visiting a residence in Swain County, within Indian Country. Over the course of the evening, Lambert quarreled with the victim, after Lambert accused the victim of stealing his money. During the argument, Lambert took out a knife and stabbed and sliced the victim multiple times in his shoulder and torso area. According to court records, the victim sustained heavy blood loss and required emergency surgery and more than 30 stitches as a result of the wounds inflicted by Lambert.  Following the stabbing incident, Lambert fled the scene. CIPD arrested Lambert shortly thereafter. 

Lambert is currently in federal custody and will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility.

In making today’s announcement, U.S. Attorney Murray thanked CIPD for their investigation of this case. 

Assistant United States Attorney John Pritchard, of the U.S. Attorney’s Office in Asheville, prosecuted the case.

ASHEVILLE, N.C. – Today, Chief U.S. District Judge Martin Reidinger sentenced Mance Lee Ruvolo, 41, of Asheville, to 168 months in prison on transportation of child pornography charges, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. Ruvolo was also ordered to serve a lifetime of supervised release and to register as a sex offender after he is released from prison.

Ronnie Martinez, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) in North Carolina, and Robert Schurmeier, Director of the North Carolina State Bureau of Investigation (SBI), join U.S. Attorney Murray in making today’s announcement.

According to filed documents and statements made in court, on July 13, 2018, law enforcement became aware that an individual was using an e-mail address to upload images containing child pornography. Law enforcement identified the email account user as Ruvolo, and positively linked to Ruvolo the cell phone used to upload the child pornography. Court documents also show that a review of Ruvolo’s email account revealed additional images and videos of child exploitation, including videos and images of prepubescent children being sexually abused.  Ruvolo pleaded guilty to transportation of child pornography on January 3, 2020.

Ruvolo is currently in custody and will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility. 

U.S. Attorney Murray thanked HSI and SBI for handling the investigation.   

Special Assistant U.S. Attorney (SAUSA) Alexis Solheim, with the U.S. Attorney’s Office in Asheville, prosecuted the case. Ms. Solheim is a state prosecutor with the office of the 43rd Prosecutorial District, and was assigned by District Attorney Ashley Welch to serve as a SAUSA with the U.S. Attorney’s Office in Asheville.  Ms. Solheim is duly sworn in both state and federal courts.  The SAUSA position is a reflection of the partnership between the office of the 43rd Prosecutorial District and the United States Attorney’s Office. 

This case was brought as part of Project Safe Childhood, a nationwide initiative launched in 2006 by the Department of Justice, aimed at combating the growing online sexual exploitation of children.  By combining resources, federal, state and local agencies are better able to locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue those victims.  For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.

CHARLOTTE, N.C. – Alexander Samuel Smith, 32, of Waxhaw, N.C., was sentenced to 60 months in prison late yesterday, for making a false statement to the FBI, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.   Chief U.S. District Judge Max O. Cogburn Jr. also ordered Smith to serve three years under court supervision upon completion of his prison term. As a special condition of Smith’s supervised release, the Court ordered the defendant to have no contact with any organization or person on the State Department’s designated terrorist list.

John A. Strong, Special Agent in Charge of the FBI in North Carolina joins U.S. Attorney Murray in making today’s announcement.

According to filed court documents, evidence presented at trial and yesterday’s sentencing hearing, in February 2016, Smith lied during an interview with the FBI about his plans to travel to Syria to join the Islamic State of Iraq and al-Sham (ISIS), and about providing assistance to other individuals to do the same. Specifically, as trial evidence established, Smith denied purchasing a “buddy pass,” which is a discounted airfare offered to airline employees, for an individual he believed wanted to exit the United States and ultimately join ISIS in Syria.

In announcing the sentence, Judge Cogburn said that Smith was “ready, willing and able to help a terrorist organization,” and that the sentence was designed in part to deter people from lying to protect terrorists.

On March 21, 2019, a federal jury convicted Smith of two counts of making a false statement to the FBI.  Smith is currently in federal custody and will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility.

The case was investigated by the FBI. Assistant U.S. Attorney Michael Savage of the U.S. Attorney’s Office in Charlotte prosecuted the case.

CHARLOTTE, N.C. – A federal jury in Charlotte convicted Robert Nathaniel Johnson, III, 35, of Lancaster, South Carolina today for credit card fraud, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. U.S. District Judge Max O. Cogburn Jr. presided over the trial.

Reginald A. DeMatteis, Special Agent in Charge of the United States Secret Service, Charlotte Field Office, joins U.S. Attorney Murray in making today’s announcement.

According to filed court documents and evidence presented at trial, from September 29 to October 20, 2018, Johnson and his co-defendant, Charles Vincent Brown, used a stolen credit card number to create counterfeit credit cards, which they then used to purchase more than $250,000 of merchandise, including electronics, sneakers, clothing and gaming equipment.  Trial evidence established that the defendants obtained the credit card of an individual identified as Victim #1, and re-encoded the stolen credit card number onto counterfeit credit cards bearing the defendants’ names and the names of other co-conspirators. According to evidence presented at trial, Johnson and others used the counterfeit credit cards at multiple retail stores, including at Best Buy, Foot Action, Foot Locker, and Neiman Marcus. Johnson specifically used the counterfeit credit cards to buy more than $10,000 in sneakers and apparel.

The jury convicted Johnson of conspiracy to commit access device fraud, which carries a maximum prison sentence of five years, and access device fraud, which carries a maximum sentence of 10 years in prison. A sentencing date for Johnson has not been set. On November 4, 2019, Brown pleaded guilty to conspiracy to commit access device fraud and is currently awaiting sentencing.

In making today’s announcement, U.S. Attorney Murray thanked the U.S. Secret Service for their investigation of this case.

Assistant U.S. Attorneys Caryn Finley and Stephanie Spaugh, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.

WASHINGTON – A federal grand jury in Charlotte, North Carolina returned an indictment yesterday, charging three Charlotte tax preparers with conspiring to defraud the United States, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and First Assistant U.S. Attorney William Stetzer for the Western District of North Carolina.

Four additional Charlotte tax preparers also named in yesterday’s indictment previously were charged with conspiring to defraud the United States in separate charging documents filed earlier this week.

According to the indictment, Joseph Octave owned and operated Kapital Financial Services, a tax return preparation business with two offices located in Charlotte, North Carolina. From 2014 through at least 2019, Octave and his employees, including Vonyeda Carson, Wendia Courtois, Whitney Vargas-Medrano, Melissa Greene, Natisha Holloman, and Kimberly Joline allegedly conspired to falsify clients’ tax returns by claiming deductions, business losses, American Opportunity credits, education credits, and earned income tax credits that the clients did not incur, in order to fraudulently increase refunds to be paid by the IRS. The indictment further charges that during some of these years, Carson and Courtois filed false tax returns in their own names.

Octave, Carson, and Courtois were charged in yesterday’s indictment. Joline, Holloman, Greene, and Vargas-Medrano were named in yesterday’s indictment but were separately charged by criminal informations filed on July 20, 2020.

If convicted, each defendant faces a maximum sentence of five years in prison on the conspiracy charge. Octave, Carson, and Courtois additionally face a maximum sentence of three years in prison on each count of aiding and assisting in the preparation of a false tax return. Carson and Courtois also face a maximum sentence of three years in prison for filing their own false tax returns. The defendants also face a period of supervised release, restitution, and monetary penalties.

An indictment or information merely alleges that crimes have been committed. The defendants are presumed innocent until proven guilty beyond a reasonable doubt.

Principal Deputy Assistant Attorney General Zuckerman and First Assistant U.S. Attorney Stetzer commended special agents of IRS-Criminal Investigation, who conducted the investigation, and Trial Attorney Brian Flanagan of the Tax Division and Assistant U.S. Attorney Caryn Finley, who are prosecuting the case.

Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.

CHARLOTTE, N.C. – This week, the U.S. Attorney’s Office has charged seven Charlotte tax return preparers for conspiring to defraud the IRS.

Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and Matthew D. Line, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation Division, Charlotte Field Office (IRS-CI), join the U.S. Attorney’s Office in making today’s announcement.

A federal grand jury sitting in Charlotte returned a 20-count indictment yesterday, charging Joseph Octave, 47, Vonyeda Carson, 36, and Wendia Courtois, 44, all of Charlotte, with conspiring to defraud the United States, aiding and assisting in the preparation of false tax returns for their clients, and in some cases filing false personal tax returns.  The indictment also identifies four other tax preparers who were charged earlier this week by criminal informations with conspiracy to defraud the United States. They are, Melissa Greene, 39, Natisha Holloman, 41, Kimberly Joline 30, and Whitney Vargas-Medrano, 31, also from Charlotte.

According to the filed charging documents, Joseph Octave owned and operated Kapital Financial Services, a tax return preparation business with two offices located in Charlotte.  Since 2014, Octave and his employees, including Carson, Courtois, Vargas-Medrano, Greene, Holloman, and Joline conspired to defraud the United States by preparing and filing tax returns on behalf of clients that claimed fabricated and fraudulent items, including Schedule A deductions, Schedule C business income and losses, American Opportunity credits, education credits, and earned income tax credits.  Octave, Greene, Joline, and Vargas-Medrano trained Kapital Financial Services employees to falsify federal income tax returns.  The training material provided to employees included scripts and cheat sheets.  The indictment further alleges that Carson and Courtois filed false personal tax returns.

If convicted, the defendants face a maximum sentence of five years in prison on the conspiracy charge.  Octave, Carson, and Courtois face a maximum of three years in prison on each of the counts alleging they aided and assisted in the preparation of false income tax returns.  Carson and Courtois face a maximum sentence of three years on each of the counts alleging they signed and filed their own false tax returns. 

The indictments and informations merely allege that crimes have been committed.  The defendants are presumed innocent until proven guilty beyond a reasonable doubt.

In making today’s announcement the U.S. Attorney’s Office and Principal Deputy Assistant General Zuckerman commended special agents of IRS-Criminal Investigation, who conducted the investigation,

Assistant U.S. Attorney Caryn Finley and Trial Attorney Brian Flanagan of the Tax Division are prosecuting the case.

CHARLOTTE, N.C. – Today, U.S. District Judge Robert J. Conrad Jr. sentenced Tony Garrett Taylor, 40, a native and former resident of Harrisburg, North Carolina, currently residing in Brooklyn, N.Y., to 96 months in prison followed by two years of supervised release, for stealing more than $6.1 million from Medicaid and committing tax evasion, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. Tony Taylor was also ordered to pay $6,121,655 to North Carolina Medicaid and $1,124,603 to the U.S. Internal Revenue Service as restitution.  

John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, Matthew D. Line, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation Division, Charlotte Field Office (IRS-CI), Tommy D. Coke, Inspector in Charge of the Atlanta Division of the U.S. Postal Inspection Service, which oversees Charlotte, and Attorney General Josh Stein, who oversees the North Carolina Medicaid Investigations Division (MID), join U.S. Attorney Murray in making today’s announcement.

According to filed court documents and today’s sentencing hearing, from June 2015 to December 2017, Tony Taylor and his brother, Jerry Lewis Taylor, operated a scheme to defraud Medicaid of more $9.4 million by submitting false and fraudulent reimbursement claims for patient services that were either non-existent or mischaracterized to Medicaid.  The brothers submitted the fraudulent claims through several companies they owned and/or operated, including Taylor Behavioral Health Center, LLC and Options Driven LLC, both located in Monroe, N.C.; Design for Change LLC located in Raleigh and elsewhere; and SHG Consultants, located in Gastonia, N.C. and elsewhere (collectively, the “Taylor businesses”). These entities specialized in providing outpatient behavioral health services to at-risk youth throughout North Carolina.

Court records show that, during the relevant time period, Tony Taylor recruited other co-conspirators to the scheme, including Ameera Ali, who provided billing services for the conspiracy and furnished Tony Taylor with prospective patient lists containing identifying information for eligible Medicaid beneficiaries. The beneficiary information obtained from Ali and others were used, in turn, to file fraudulent reimbursement claims for services that were never provided. To the extent that services were actually provided, the conspirators submitted to Medicaid fraudulent reimbursement claims that misrepresented the services rendered so as to obtain a higher reimbursement rate, a practice known as “upcoding.”

According to court documents, Tony Taylor also recruited Devon Rambert-Hairston, a licensed nurse practitioner and the director of one of the entities operated by the brothers, to review and sign-off on fictitious patient progress notes. Court records show that Rambert-Hairston never provided any behavioral health or medical services to the Medicaid beneficiaries or rarely interacted with them at all. To the extent that the beneficiaries received any treatment, those services were provided by an individual identified in court documents as J.B., who was not credentialed to provide those types of services.

Tony and Jerry Taylor also conspired with Christine Yvette Knight, who operated Connect and Move Staffing LLC in Florida. Knight’s role in the conspiracy was to create fraudulent treatment notes for the beneficiaries, and to prepare fake billing spreadsheets which were used by the brothers to further perpetuate the fraud.

During the course of the fraudulent scheme, Tony and Jerry Taylor caused hundreds of false and fraudulent claims to be submitted to Medicaid for false and fraudulent services.  As a result, more than $9.4 million in fraudulent claims were submitted to Medicaid, resulting in approximately $6.1 million in fraudulent payments from Medicaid.

In addition to health care fraud, Tony Taylor also committed tax evasion, by failing to file timely and/or accurate U.S. Individual Income Tax Returns for tax years 2015, 2016, and 2017, and diverting fraudulent receipts from Medicaid to nominee entities and individuals. Tony Taylor also made personal expenditures using business accounts and Medicaid fraud proceeds, including spending more than $2.9 million for his “opulent lifestyle,” air fare, hotels, nightclubs, and shopping.  

Tony Taylor pleaded guilty to health care fraud conspiracy and tax evasion. He is currently released on bond and upon designation of a federal facility he will report to the federal Bureau of Prisons to begin serving his sentence. 

In announcing Tony Taylor’s sentence, Judge Conrad noted that Tony Taylor stole from programs designed to help disadvantaged children for personal gain and an opulent lifestyle.

Jerry Taylor is currently awaiting sentencing after pleading guilty to health care fraud conspiracy. Ameera Ali also pleaded guilty to health care fraud conspiracy and is currently awaiting sentencing. Devon Rambert-Hairston pleaded guilty to money laundering conspiracy and was sentenced to a year and a day in prison and a year of supervised release, and was ordered to pay $813,726 in restitution. Christine Yvette Knight pleaded guilty to making a false statement relating to health care matters. A sentencing date for Knight has not been set.

In making today’s announcement U.S. Attorney Murray thanked the FBI, the IRS, USPIS, and MID for their investigation of this case.

Assistant U.S. Attorneys Michael Savage and William Bozin of the U.S. Attorney’s Charlotte Office are prosecuting the case.

If you suspect Medicare or Medicaid fraud please report it by phone at 1-800-447-8477 (1-800-HHS-TIPS), or E-Mail at HHSTips@oig.hhs.gov.

CHARLOTTE, N.C. – U.S. District Judge Frank D. Whitney handed down a 68-month sentence Monday afternoon to Delmond Dmonta Cunningham for a firearms offense, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. In addition to the prison term imposed, Cunningham, 26, of Charlotte, was also ordered to serve three years under court supervision.

U.S. Attorney Murray is joined in making today’s announcement by Vincent C. Pallozzi, Special Agent in Charge of the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Charlotte Field Division, and Chief Johnny Jennings of the Charlotte Mecklenburg Police Department (CMPD).

According to court documents and yesterday’s sentencing hearing, on August 30, 2018, at about 7:30 a.m., CMPD offices responded to a call regarding shots being fired near Villa Heights Elementary School in Charlotte. Court records show that a male, later identified as Cunningham, fired two shots at his ex-girlfriend and a relative, while they were in their vehicle dropping off the victim’s daughter at school. According to court documents, Cunningham followed the victim throughout the school parking lot, and once the victim left the parking lot Cunningham pointed a firearm out of his car window and fired two shots at the victim’s car. After the shots were fired, Cunningham fled the scene. Court records show that Cunningham has a history of domestic violence, and that, at the time of the incident, the victim had obtained a restraining order against him.

Over the course of the investigation, law enforcement determined that two .45 caliber shell casings were found in the school parking lot, which were later matched up with a stolen .45 caliber pistol found in Cunningham’s possession at the time of his arrest. One of the rounds fired penetrated a bedroom of a nearby house. Cunningham has a prior felony conviction and is prohibited from possessing a firearm or ammunition. On April 23, 2019, Cunningham pleaded guilty to possession of ammunition by a convicted felon. At yesterday’s sentencing hearing, Judge Whitney varied upward and imposed on Cunningham a sentence above the statutory guidelines.

At the sentencing hearing, in discussing the nature and circumstances of the offense, Judge Whitney described the defendant’s actions as “extraordinarily reckless” and noted that, luckily, “the round that went into another house did not hurt anyone.” Cunningham is currently in custody and will be transferred to the custody of the Federal Bureau of Prisons upon the designation of a federal facility.

The investigation was handled by the ATF and CMPD. The case was prosecuted by Assistant United States Attorney Robert Gleason of the U.S. Attorney’s Office in Charlotte.

CHARLOTTE, N.C. – The U.S. Attorney’s Office for the Western District of North Carolina, in partnership with the FBI and the AARP in North Carolina, hosted a virtual informational seminar via Facebook Live today, to discuss the rise of online romance

scams targeting older adults and to offer tips on how to avoid becoming a victim of fraud, announced U.S. Attorney Andrew Murray. 

Due to the COVID-19 pandemic, older adults are increasingly turning to the internet to obtain information, stay in touch with loved ones, connect with friends on social media, and form new romantic relationships. Scammers are taking advantage of older Americans’ increased online presence to perpetuate romance scams and steal elder victims’ money and identities, and, even worse, turn older adults into unwitting “money mules.” A money mule is a person that uses an existing or new bank account to conduct wire transfers or other types of financial transactions at the request of a scammer. Typically, the funds the money mules receive and engage in transactions with are proceeds of fraudulent schemes and, in many instances, the account holders are not aware they are being exploited as money mules to carry out financial fraud.

During today’s livestream presentation, Assistant U.S. Attorney and Elder Fraud Coordinator for the Western District Maria Vento, and Supervisory Special Agent for the FBI Brian Cyprian provided an overview of romance scams, money mule schemes and identity theft, and shared useful tips on how to spot those types of scams and how to avoid becoming a victim of fraud. Here are some of the tips shared with the audience:

• Be mindful of what information you post and make public online, as scammers can use details shared on social media and dating sites to better understand and target you.
• If someone contacts you and wants to start a romantic relationship with you, research the person’s photo and profile using online searches to see if the image, name, or details have been used elsewhere.
• Go slowly and ask lots of questions.
• Beware if the individual seems too perfect or quickly asks you to leave a dating service or social media site to communicate directly on your own phone or through a third party app.
• Beware if the individual attempts to isolate you from friends and family or requests inappropriate photos or financial information that could later be used to extort you.
• Beware if the individual promises to meet in person, but always comes up with excuses as to why he or she can’t.
• Never send money to anyone you have only communicated with online or by phone.
• If an online prospect claims to be a United States citizen living or working in another country and asks you for help or money, refer him or her to the local U.S. Embassy or Consulate. If you want to send money, consider using a U.S. Department of State Office of Overseas Citizens Services (OCS) Trust.
• Do not use your personal bank account to transfer money or conduct financial transactions at the direction of someone you met online.
• Do not give out personal information via the phone, mail, or internet/email unless you initiated the contact and are certain you are dealing with a trusted organization or individual.
• Verify requests for personal information from any business or financial institution by contacting them using the main contact information on their official website.
• Do not open, respond to, or click on links contained within unsolicited emails.
• Use strong and different passwords to secure banking accounts, credit accounts, etc., and change passwords and check accounts routinely.
• Limit personal information shared publicly on social networking sites. Never post your full name, Social Security number, address, phone number, or account numbers in publicly accessible sites.
• Regularly obtain and check your credit reports from the three credit bureaus to ensure you recognize all accounts.
• Tell someone you trust if you have become a victim.
• If you suspect fraud or have fallen victim to an online scam report the fraud to the authorities and the dating website.
• Keep in mind that if you send money once, you’ll be a target for life.
• Remember, it’s not rude to say, “NO,” if someone approaches you online.
• A good rule of thumb is, if it’s too good to be true, it’s likely a scam.

To report suspicious activity or if you’ve fallen victim to a scam, please call the Department of Justice’s National Elder Fraud Hotline at 1-833-FRAUD-11 (1-833-372-8311), or online at www.IC3.gov.

For more information about the U.S. Attorney’s Office Elder Justice Initiative, please visit: https://www.justice.gov/usao-wdnc/elder-justice-initiative. 

A recording of the seminar can be viewed at https://www.facebook.com/AARPNC/videos/vb.86880509778/291438361931498/?type=2&theater.

CHARLOTTE, N.C. – A federal jury in Charlotte has convicted William Jon Patric Ebert, 60, of Boone, N.C. of child pornography charges, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. U.S. District Judge Frank D. Whitney presided over the trial. The jury returned the guilty verdict on Friday, July 17, 2020, following a two-day trial.

According to filed court documents and evidence presented at trial, Ebert sexually abused a minor for more than six years. The sexual abuse took place in Ohio and in North Carolina. Evidence presented at trial established that Ebert also used the minor to produce child pornography photographs of the minor, and that he stored those photographs on his computer and other devices he owned. On September 22, 2016, law enforcement officials executed a search warrant at Ebert’s residence in Boone and seized several devices and computers.  A forensic analysis of Ebert’s hard drive revealed that it contained sexually explicit images of the minor victim.

The jury convicted Ebert of using a minor to produce child pornography photographs of the minor. The jury also convicted Ebert of possessing those photographs. He was found not guilty of transporting a minor with intent to engage in sexual criminal activity. Ebert is currently in federal custody. A sentencing date has not been set.

The production of child pornography charge carries a mandatory minimum sentence of 15 years and a maximum sentence of 30 years in prison. The possession of child pornography charge carries a maximum sentence of 10 years in prison. Both charges carry a maximum fine of $250,000.   

In making today’s announcement U.S. Attorney Murray thanked the North Carolina State Bureau of Investigation and the Avon Police Department in Ohio for their investigation of this case. 

Assistant United States Attorneys Kimlani Ford and Eric Lindahl are prosecuting the case for the United States.

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

ASHEVILLE, N.C. – Chief U.S. District Judge Martin Reidinger sentenced William Keith Leonhart, 41, of Franklin, N.C., to 154 months in prison followed by five years of supervised release for robbing at gunpoint an Asheville bank, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.

According to filed court documents and yesterday’s sentencing hearing, on August 5, 2019, the Asheville Police Department received a call regarding an armed robbery of the First Citizens Bank located at 1201 Tunnel Road in Asheville. Court records show that Leonhart had entered the bank, approached a teller and brandished a firearm. While pointing his firearm at the teller, Leonhart gave the teller a threatening demand note. The teller handed Leonhart approximately $500 out of her cash drawer and Leonhart fled the scene in a stolen vehicle. The next day, law enforcement identified Leonhart driving a second stolen vehicle in Black Mountain, N.C. Following a vehicle chase, Leonhart was arrested, and law enforcement recovered from inside the vehicle the firearm Leonhart had used during the robbery. According to court records, Leonhart had previously robbed the same bank in 2013, and had received a sentence of 66-89 months in prison.

In October 2019, Leonhart pleaded guilty to one count of bank robbery and one count of possession of a firearm in furtherance of a crime of violence. He is currently in federal custody and will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility.

In making today’s announcement U.S. Attorney Murray thanked the Asheville Police Department, the Black Mountain Police Department, and the Federal Bureau of Investigation for their investigation of this case. He also thanked District Attorney Todd Williams for his office’s coordination over the course of the prosecution of this case.

Special Assistant United States Attorney (SAUSA) Alexis Solheim prosecuted the case.  Ms. Solheim is a state prosecutor with the office of the 30th Prosecutorial District, and was assigned by District Attorney Ashley Welch to serve as SAUSA with the U.S. Attorney’s Office in Asheville.  Ms. Solheim is duly sworn in both state and federal courts.  The SAUSA position is a reflection of the partnership between the office of the 30th Prosecutorial District and the United States Attorney’s Office.  The SAUSA position helps ensure the effective and vigorous prosecution of federal court cases that impact the counties within the 30th Prosecutorial District. 

ASHEVILLE, N.C. – U. S. District Judge Martin Reidinger sentenced Ginger Lynn Cunningham, 39, formerly of Hendersonville and currently residing in Brevard, to 14 months in prison yesterday, for selling fake title insurance policies, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. In addition to the prison term imposed, Cunningham was ordered to serve three years under court supervision and to pay $412,344 as restitution.

According to information contained in filed court documents and presented in court during Cunningham’s sentencing hearing, Cunningham owned and operated Blue Ridge Title Company, an independent title insurance agency located in Buncombe County. Beginning in February 2015, Cunningham became an authorized independent agent for Commonwealth Land Title Insurance Company (Commonwealth).  As an authorized agent, Cunningham’s title agency sold title insurance policies underwritten by Commonwealth and collected premium payments during real estate closings.  Under the agreement with Commonwealth, Cunningham’s Blue Ridge Title Company would keep 80% of the premium payments, and the remaining 20% would be sent to Commonwealth. On or about March 21, 2016, Commonwealth terminated their agreement with Blue Ridge Title Company, because Cunningham failed to submit premium payments as required to Commonwealth.  At the time of termination, Blue Ridge Title Company owed Commonwealth in excess of $25,000 in premium payments.

According to court documents, from March 2016 until October 2017, Cunningham continued to represent herself and Blue Ridge Title Company to be an independent agent of Commonwealth, despite knowing that she no longer had any relationship with Commonwealth, and continued to sell fictitious title insurance policies and collect premium payments. The buyers of these bogus title insurance policies did not know that they were not underwritten by any insurance provider, and thus had no value.  Court records show that Cunningham further deceived her customers by drafting official looking, but fictitious, policy documents that bore the name of Commonwealth Land Title Insurance Company and fabricated policy numbers.  Cunningham kept 100% of the premium payments associated with these worthless policy sales.  As court records show, during the relevant time period, Cunningham sold at least 973 counterfeit title insurance policies and received at least $412,344 in premiums for the bogus policies. On October 28, 2019, Cunningham pleaded guilty wire fraud.

In making today’s announcement U.S. Attorney Murray commended the U.S. Department of Housing and Urban Development, Office of Inspector General, the Federal Housing Finance Agency, Office of Inspector General, and the North Carolina Department of Insurance for their investigation of this case.

Assistant United States Attorney Don Gast, of the U.S. Attorney’s Office in Asheville, prosecuted the case for the United States.