Western District of North Carolina

Defendant Thuy Tien Luong, 36, was charged on March 3, 2020, in an indictment with one count of forced labor, announced Assistant Attorney General Eric Dreiband for Civil Rights and U.S. Attorney R. Andrew Murray for the Western District of North Carolina. 

According to the allegations set forth in the indictment, between late 2017 and June 26, 2018, the defendant forced the victim, whom she employed as a nail technician, to provide labor and services at her salon by means of force and threats of force to the victim. The indictment further alleges that the defendant obtained the victim’s services through means of serious harm and threats of serious harm, means of abuse and threatened abuse of law and legal process, and by means of a scheme, plan and pattern to cause the victim to believe that if she did not perform such labor and services, she would suffer serious harm.

“Human trafficking is our generation’s form of physical and psychological captivity. It is modern day slavery. These vile acts involve fundamental violations of our rights and the perpetrators must be stopped,” said Eric Dreiband, Assistant Attorney General for Civil Rights.

“Forced labor deprives victims their basic human rights and strips away their dignity. Labor trafficking schemes are deplorable and do not have place in modern society. My office remains committed to combatting all forms of human trafficking and holding perpetrators accountable for their criminal actions,” said U.S. Attorney Murray.

“Traffickers treat human beings as commodities. They use force, fraud or coercion to prey on people’s vulnerabilities,” said Homeland Security Investigations (HSI) Charlotte Special Agent in Charge Ronnie Martinez. “HSI special agents will continue to focus their efforts on eradicating this heinous crime; no one should be subject to human trafficking.”

An indictment is merely an accusation, and the defendant is presumed innocent unless proven guilty. If convicted of forced labor, the defendant faces a sentence of up to 20 years in prison, as well a mandatory restitution.

The case is being investigated by the Department of Homeland Security, Homeland Security Investigations with assistance from the Davidson Police Department and Charlotte-Mecklenburg Police Department. It is being prosecuted by Assistant U.S. Attorney Kimlani M. Ford for the Western District of North Carolina and Trial Attorney Maryam Zhuravitsky for the Civil Rights Division’s Human Trafficking Prosecution Unit.

ASHEVILLE, N.C. – U.S. District Judge Martin Reidinger sentenced Bobby Roger Burch, 48, of Hayesville, N.C. today to 262 months in prison, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.  Judge Reidinger also ordered Burch to serve five years under court supervision upon completion of his prison sentence.

According to filed court documents and today’s sentencing hearing, Burch was part of a drug conspiracy operating in North Carolina and Georgia, that distributed significant quantities of methamphetamine in and around Clay County and elswhere. Court records show that Burch was the North Carolina-based source of supply for the drug ring.  Court records also show that, over the course of the investigation, law enforcement conducted controlled buys and seized significant quantities of methamphetamine from the drug conspiracy.  According to court records, law enforcement seized from Burch more than three pounds of methamphetamine, which Burch was transporting from Georgia to North Carolina.  In addition to the narcotics, law enforcement seized 39 firearms from Burch’s residence, including an assault rifle.  As reflected in court documents, Burch obstructed or attempted to impede the administration of justice by threatening and intimidating some of his co-conspirators whom he suspected were cooperating with law enforcement.

In making today’s announcement, U.S. Attorney Murray said, “The arrest and prosecution of Burch and several of his co-conspirators has positively impacted Clay County and the surrounding areas in North Carolina, which have seen a significant drop in criminal activity following the successful dismantling of this multi-state drug trafficking ring. Working with our law enforcement partners, we will continue to identify, investigate, and prosecute drug trafficking organizations that plague our communities with deadly drugs and drug-fueled crimes.”

“The cocktail of deadly chemicals used to manufacture methamphetamine are a recipe for disaster. These substances are not only volatile and toxic, but they also destroy families, communities and lives. Because of the collective effort between DEA and its local, state and federal law enforcement counterparts and the U.S. Attorney’s Office, this defendant was brought to justice and will spend well-deserved time in prison,” said Robert J. Murphy, the Special Agent in Charge of the DEA Atlanta Field Division.

U.S. Attorney Murray thanked the DEA’s Asheville Post of Duty; the Clay County Sheriff’s Office; the Georgia Bureau of Investigation; the Swain County Sheriff’s Office; the Macon County Sheriff’s Office; the Highlands Police Department; and the North Carolina State Bureau of Investigation for handling the investigation. 

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In a separate case, Judge Reidinger also sentenced James Kevin Jones, 45, of Candler, N.C. to 188 months in prison followed by four years of supervised release.  According to court documents and today’s sentencing hearing, investigators made three controlled buys of methamphetamine from Jones and seized methamphetamine and a loaded firearm from Jones’ residence in Candler during the course of the investigation. 

Court documents show that law enforcement also seized an additional quantity of methamphetamine that Jones concealed on his body while in the Buncombe County Detention Center.  According to court records and statements made in court today, Jones has multiple prior felony convictions, and committed crimes while he was on state probation for those convictions. 

Jones’ investigation was handled by the Buncombe County Anti-Crime Task Force and the Buncombe County Sheriff’s Office. 

Both defendants are in custody, and upon designation of a federal facility they will be transferred to the custody of the Federal Bureau of Prisons. All federal sentences are served without the possibility of parole. 

Assistant U.S. Attorney Thomas Kent, of the U.S. Attorney’s Office in Asheville, prosecuted both cases.  

CHARLOTTE, N.C. – U.S. Attorney Andrew Murray of the District of North Carolina today urged the public to report suspected fraud schemes related to COVID-19 (the Coronavirus) by calling the National Center for Disaster Fraud (NCDF) hotline (1-866-720-5721) or to the NCDF e-mail address disaster@leo.gov.

In coordination with the Department of Justice, Attorney General William Barr has directed U.S. Attorneys to prioritize the investigation and prosecution of Coronavirus fraud schemes.

“It is utterly despicable that scammers will try to profit from the COVID-19 national crisis, but fraudsters will stop at nothing to make a buck! I strongly encourage everyone to be on heightened alert about potential scams related to COVID-19, and to report the fraud to the National Center for Disaster Fraud (NCDF) hotline (1-866-720-5721) or e-mail NCDF at disaster@leo.gov. Reporting scams will help us investigate and prosecute wrongdoers, and track scams so we can warn the public about emerging schemes.”

Some examples of these schemes include:

• Individuals and businesses selling fake cures for COVID-19 online and engaging in other forms of fraud.
• Phishing emails from entities posing as the World Health Organization or the Centers for Disease Control and Prevention.
• Malicious websites and apps that appear to share Coronavirus-related information to gain and lock access to your devices until payment is received.
• Seeking donations fraudulently for illegitimate or non-existent charitable organizations.
• Medical providers obtaining patient information for COVID-19 testing and then using that information to fraudulently bill for other tests and procedures.      

In a memorandum to U.S. Attorneys issued March 19, Deputy Attorney General Jeffrey Rosen also directed each U.S. Attorney to appoint a Coronavirus Fraud Coordinator to serve as the legal counsel for the federal judicial district on matters relating to the Coronavirus, direct the prosecution of Coronavirus-related crimes, and to conduct outreach and awareness activities.  

The Coronavirus Fraud Coordinator for the Western District of North Carolina is Assistant U.S. Attorney (AUSA) Jenny Sugar.  AUSA Sugar is an experienced prosecutor, and currently serves as Deputy Chief overseeing the district’s White Collar Fraud Unit.

The NCDF can receive and enter complaints into a centralized system that can be accessed by all U.S. Attorneys, as well as Justice Department litigating and law enforcement components to identify, investigate and prosecute fraud schemes.  The NCDF coordinates complaints with 16 additional federal law enforcement agencies, as well as state Attorneys General and local authorities.

is the best way to avoid being defrauded by scammers. To find out more about Department of Justice resources and information, please visit www.justice.gov/coronavirus.

Here are some helpful tips to avoid COVID-19 scams:

• Do not purchase items that purport to cure COVID-19. Currently there are no vaccines, pills, drinks, lotions or any other product available on the market that can treat or cure COVID-19.
• Do not click on links or reply to texts from unknown sources as they may download malware and viruses to computers or devices.
• Instead of clicking on emails claiming to be from the CDC or WHO, go directly to websites for the Centers for Disease Control and Prevention (www.cdc.gov) and the World Health Organization (www.who.int) to obtain information.
• When it comes to donations, do not let a scammer rush you into making a donation.  Instead, take the time to do extensive research online. 
• Do not make a donation in cash, via gift card, or a wire transfer, and do not provide your banking information or debit card numbers.

Stay alert. Protect yourself from scams and report the fraud. Call the National Center for Disaster Fraud (NCDF) hotline (1-866-720-5721) or e-mail NCDF at disaster@leo.gov.

CHARLOTTE, NC – Today, U.S. Attorney Andrew Murray and the FBI issued a warning, urging the public to remain vigilant against COVID-19 scams.

“I encourage everyone to be on heightened alert about potential scams related to COVID-19,” said U.S. Attorney Murray.  “At the request of the United States Attorney General, I have directed federal prosecutors in my office to prioritize the detection, investigation and prosecution of criminal conduct related to COVID-19. We will not allow scammers to profit from this outbreak.”  

Possible types of COVID-19 scams are:

• Individuals or businesses selling fake cures for COVID-19.
• Online offers for vaccinations and test kits.
• Phishing emails or texts from entities posing as the World Health Organization (WHO) or the Centers for Disease Control and Prevention (CDC).
• Malware inserted in mobile apps designed to track the spread of COVID-19 that can steal information stored on devices.
• Malicious COVID-19 websites and apps that can gain and lock access to devices until a ransom payment is made.
• Solicitations for donations to fake charities or crowdfunding sites.

Here are some tips to help avoid COVID-19 scams:

• Do not purchase items that purport to cure COVID-19. Currently there are no vaccines, pills, drinks, lotions or any other product available on the market that can treat or cure COVID-19.
• Do not purchase COVID-19 test kits on line.
• Do not click on links or reply to texts from unknown sources as these may download malware and viruses to computers or devices.
• Be particularly aware of emails claiming to be from the CDC or WHO, claiming to have vital information about the virus. Instead, go directly to websites for the Centers for Disease Control and Prevention (www.cdc.gov) and the World Health Organization (www.who.int).
• When it comes to donations, do not let a scammer rush you into making a donation.  Instead, take the time to do extensive research online. 
• Do not make a donation in cash, via gift card, or a wire transfer, and do not provide your banking information or debit card numbers.

Education is the best way to avoid being defrauded by scammers. To learn more about COVID-19 scams and for help with recognizing and avoiding fraud schemes please visit the Federal Trade Commission website.  Report suspected fraud to the FBI at www.ic3.gov.

CHARLOTTE, N.C. – A federal grand jury sitting in Charlotte has returned an indictment against Anthony Blane Byrnes, 19, of Huntersville, N.C., charging him with drug conspiracy and related drug charges for trafficking narcotics he purchased on the dark web, with coordination through Bitcoin ATMs, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.

According to allegations contained in the indictment and a previously-filed criminal complaint, in August 2019, law enforcement intercepted a mail parcel containing suspected narcotics. The parcel was allegedly mailed from Slovenia and addressed to Byrnes.  On or about August 7, 2019, law enforcement conducted a controlled delivery of the suspected parcel at Byrnes’ residence. As alleged in court documents, law enforcement observed Byrnes picking up the parcel and retreating to his residence.  Subsequently, law enforcement executed a search warrant at Byrnes’ residence and seized numerous narcotics and contraband, including LSD, MDMA/Ecstasy, marijuana, other narcotics and drug paraphernalia. Law enforcement also recovered two firearms from his residence. The indictment also alleges a previous infraction in April 2019, wherein law enforcement recovered additional narcotics and a firearm. In total, three firearms and approximately $13,800 in cash were recovered from Byrnes’ residence in this investigation.

According to allegations contained in court documents, Byrnes bought the narcotics via the Dark Net Marketplace (DNM) “Empire Market,” and used Bitcoin to pay for the drugs. Court documents further allege that Byrnes used multiple Bitcoin ATM machines in Charlotte to make numerous drug transactions.

Byrnes is currently in federal custody. He is charged with drug trafficking conspiracy, which carries a mandatory minimum sentence of 10 years to life in prison; possession with intent to distribute LSD, which carries a mandatory minimum sentence of 10 years to life in prison; possession with intent to distribute Psilocin, which carries a maximum prison sentence of 20 years; possession with intent to distribute DMT, which carries a maximum prison sentence of 20 years; possession with intent to distribute marijuana, which carries a maximum prison sentence of five years; and two counts of possession of a firearm in furtherance of a drug trafficking crime, which carries a mandatory minimum prison sentence of five years to life, to be served consecutive to other imposed charges, per count.

The charges in the indictment are allegations. The defendant is presumed innocent 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 leading the investigation, and thanked the Drug Enforcement Administration, ICE’s Homeland Security Investigations, the U.S.Customs and Border Protection,  and the Huntersville Police Department for their invaluable assistance.

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

ASHEVILLE, N.C. – U.S. District Judge Martin Reidinger sentenced Eugene “Bo” Mashburn, 58, of Hayesville, N.C. today to 135 months in prison, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.  Judge Reidinger also ordered Mashburn to serve five years under court supervision upon completion of his prison sentence.

According to filed court documents and today’s sentencing hearing, Mashburn conspired with other drug traffickers in North Carolina and Georgia to distribute significant quantities of methamphetamine.  According to court records, over the course of the investigation, law enforcement conducted two controlled buys of methamphetamine from Mashburn and seized methamphetamine, 24 firearms and two silencers from Mashburn’s residence. 

In making the announcement, U.S. Attorney Murray thanked the DEA’s Asheville Post of Duty; the Clay County Sheriff’s Office; the Georgia Bureau of Investigation; the Swain County Sheriff’s Office; the Macon County Sheriff’s Office; the Highlands Police Department; and the North Carolina State Bureau of Investigation for handling the investigation.  

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In a separate case, Judge Reidinger also sentenced today Jeremy Daniel Bowen, 44, of Maggie Valley, N.C. to 210 months in prison followed by five years of supervised release.  According to court documents and today’s sentencing hearing, law enforcement became aware that Bowen, who has a prior murder conviction, was operating a methamphetamine lab out of his residence in Maggie Valley.  Court records show that law enforcement seized processed methamphetamine from the residence as well as a loaded firearm. 

Bowen’s investigation was handled by the DEA’s Asheville Post of Duty and the Maggie Valley Police Department. 

Both defendants are in custody, and upon designation of a federal facility they will be transferred to the custody of the Federal Bureau of Prisons. All federal sentences are served without the possibility of parole. 

Assistant U.S. Attorney Thomas Kent, of the U.S. Attorney’s Office in Asheville, prosecuted both cases.           

ASHEVILLE, N.C. – U.S. District Judge Martin Reidinger sentenced Jonathan David Taylor today to 46 months in prison and three years of supervised release, for the May 2019 assault of a tribal elder, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. Taylor, 33, of Whittier, N.C., pleaded guilty on October 23, 2019, to assault with a dangerous weapon with intent to do bodily harm.

Chief Doug Pheasant of the Cherokee Indian Police Department joins U.S. Attorney Murray in making todays’ announcement.

According to filed court documents and today’s sentencing hearing, on May 8, 2019, Taylor used a metal pipe to strike a 71-year-old male victim in the forehead, inflicting serious injury. Court records show that Taylor assaulted the victim when the victim attempted to prevent Taylor from physically assaulting Taylor’s then-girlfriend. Court records also show that Taylor caused the victim to sustain a large jagged laceration on the top of his head that required medical attention. Both Taylor and the victim are enrolled members of the Eastern Band of Cherokee Indians. 

Taylor is currently in federal custody and will be transferred to the custody of the federal Bureau of Prisons. All federal sentences are served without the possibility of parole.

U.S. Attorney Andrew Murray thanked CIPD for their investigation of the case. Assistant United States Attorney John Pritchard, of the U.S. Attorney’s Office in Asheville, prosecuted the case.

CHARLOTTE, N.C. – A federal grand jury has returned a criminal indictment charging Shomarley Lockhard Hodge, 33, of Charlotte, with embezzlement, bank larceny, and transactional money laundering for stealing $325,000 in cash intended to restock bank ATMs, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. Hodge turned himself in to FBI agents this morning.

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

According to allegations contained in the indictment, in December 2019, Hodge began working as an armed guard for an armored truck company identified in the indictment as “Company L.” In that capacity, the indictment alleges, Hodge was responsible for the safe delivery of cash entrusted to Company L’s custody on behalf of a bank, to the bank’s branches and ATMs in the Charlotte area.

According to allegations in the indictment, on or about January 30, 2020, Hodge abused his position of trust and stole approximately $325,000 from the armored truck, which was supposed to be delivered to several bank ATMs. As alleged in the indictment, the following day, on January 31, 2020, and continuing through on or about February 6, 2020, Hodge began making large cash deposits into the bank account of an acquaintance. During the relevant time period, Hodge made more than 95 such cash deposits, totaling at least $139,000. Hodge also used some of the money to pay for personal expenses, and to make a $40,000 down payment on a 2020 BMW x7 vehicle, with a purchase price of more than $118,000.

Hodge had his initial appearance this morning before U. S. Magistrate Judge David C. Keesler. The embezzlement charge carries a maximum penalty of 30 years in prison and a $1 million fine.  The bank larceny charge carries a maximum penalty of 10 years in prison and a $250,000 fine.  The maximum penalty for transactional money laundering is 10 years in prison and a $250,000 fine.

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

The FBI in Charlotte investigated the case. Assistant United States Attorney Daniel Ryan, of the U.S. Attorney’s Office in Charlotte, is prosecuting the case.

CHARLOTTE, N.C. – The Justice Department and the Drug Enforcement Administration (DEA) today announced the results of Project Python, a DEA-led interagency operation encompassing all global investigations and related disruption activities targeting the Cártel de Jalisco Nueva Generación (CJNG).

This announcement marks the successful conclusion of six months of investigative and enforcement activity targeting CJNG, culminating in large scale arrests throughout the country within the past week.  Project Python has resulted more than 600 arrests, 350 indictments, as well as significant seizures of money and drugs.

In 2020, within Western North Carolina, six defendants have been prosecuted to date, in connection with the initiative:

• Jose Velasquez, 35, a Mexican national residing in Charlotte, N.C., has been charged with drug trafficking conspiracy; international money laundering; possession with intent to distribute heroin; possession with intent to distribute methamphetamine; and possession with intent to distribute cocaine.
• Johnny Michael Boone, Jr., 33, of Bessemer City, N.C., has been charged with possession with intent to distribute methamphetamine.
• Jose Rigoberto Rodriquez-Rangel, 21, of Durham, N.C., has pleaded guilty to drug trafficking conspiracy; money laundering conspiracy; and possession with intent to distribute heroin. He is currently awaiting sentencing.  
• Jose Dolorez Martinez-Martines, 32, a Mexican national residing in Durham, N.C., has pleaded guilty to drug trafficking conspiracy, money laundering conspiracy; and possession with intent to distribute heroin. He is currently awaiting sentencing.
• Oscar Bello-Lopez, 33, a Mexican national residing in Charlotte, has been sentenced to 188 months in prison and five years of supervised release, for drug trafficking conspiracy; money laundering conspiracy; possession with intent to distribute heroin; possession of a firearm by a felon; illegal reentry by a felon.
• Otequise Lenard Miller, 34, of Concord, N.C., has been sentenced to 240 months in prison and five years of supervised release for drug trafficking conspiracy resulting in death; money laundering conspiracy; distribution and possession with intent to distribute methamphetamine.

“Project Python marks the most comprehensive action to date in the Department of Justice’s campaign to disrupt, dismantle, and ultimately destroy CJNG,” said Assistant Attorney General Brian A. Benczkowski of the Criminal Division.  “When President Trump signed an Executive Order prioritizing the dismantlement of transnational criminal organizations, the Department of Justice answered the call and took direct aim at CJNG.  We deemed CJNG one of the highest-priority transnational organized crime threats we face.  And with Project Python, we are delivering results in the face of that threat for the American people.” 

“Project Python is the single largest strike by U.S. authorities against CJNG, and this is just the beginning,” said Acting Administrator Uttam Dhillon. “This strategic and coordinated project exemplifies DEA’s mission: to disrupt, dismantle, and destroy drug trafficking organizations around the world and bring their leaders to justice.  Today, DEA has disrupted CJNG’s operations, and there is more to come as DEA continues its relentless attack on this remorseless criminal organization.”

“This ruthless Mexican cartel has evolved into a powerful drug syndicate that floods urban and rural communities in the Western District and throughout our nation with enormous quantities of powerful narcotics. My office and our law enforcement partners remain committed to bringing members of this drug trafficking organization to justice, and disrupting CJNG’s drug trafficking networks in Western North Carolina,” said U.S. Attorney Andrew Murray.  

“This DEA-led multilateral and interagency operation resulted in a well-planned and coordinated assault against CJNG, which is one of the most prolific producers of methamphetamine in the world. CJNG is responsible for an enormous quantity of dangerous drugs destined for the U.S. and much of the violence in Mexico today. This strategic strike against this Mexico-based cartel is just the beginning of an all-out assault against this ruthless organization,” said Robert J. Murphy, the Special Agent in Charge of the DEA Atlanta Field Division.

The Justice Department and its law enforcement partners are committed to fulfilling the President’s Executive Order 13773 to identify, interdict, disrupt and dismantle transnational criminal organizations.  The department designated CNJG as one of the top transnational criminal groups targeted as part of carrying out this executive order, and DEA instituted Project Python to support this ongoing effort. 

CJNG is one of the fastest growing transnational criminal organizations in Mexico, and among the most prolific methamphetamine producers in the world.  It is responsible for a significant proportion of drugs entering the United States, and elevated levels of violence in Mexico.  With methamphetamine abuse and overdose deaths on the rise, Project Python aims to disrupt CJNG’s ability to distribute methamphetamine and other drugs throughout the United States by attacking the group at all levels. 

Federal law enforcement has taken a number of steps to degrade CJNG’s ability to operate in the United States.  Today, the Justice Department and DEA announced a superseding indictment on charges of alleged continuing criminal enterprise against Nemesio Ruben Oseguera Cervantes, also known as “El Mencho,” the undisputed leader of CJNG.  Last month, El Mencho’s son, Ruben Oseguera Gonzalez, also known as “Menchito,” and second in command of CJNG, was extradited from Mexico to the United States on charges of alleged drug trafficking and firearm use in relation to drug trafficking activities.  On Feb. 26, 2020, El Mencho’s daughter, Jessica Johanna Oseguera Gonzalez, was arrested in the United States on financial charges related to her alleged criminal violation of the Foreign Narcotics Kingpin Designation Act.

Additionally, DEA has worked with its interagency partners to apply further pressure to CJNG.  The U.S. Department of Treasury has designated El Mencho as a “specially designated narcotics trafficker” pursuant to the Foreign Narcotics Kingpin Designation Act, and the U.S. Department of State has issued one of the largest narcotics rewards ever – $10 million – for information leading to the arrest of El Mencho.  

The efforts highlighted in the more than 600 arrests nationwide are illustrative of the significant reach the CJNG has in manufacturing, importing and distributing a wide array of illegal narcotics within the United States and the negative impact on the fabric of our local communities.  The proceeds from the local distribution of these narcotics are repatriated back to Mexico and further fuel transnational organized criminal organizations such as the CJNG.  The Department of Justice and its law enforcement partners will continue to vigorously fight this scourge against the United States. 

The Department of Justice’s multi-agency Special Operations Division, federal prosecutors from the Narcotic and Dangerous Drug Section of the Department’s Criminal Division, the Criminal Division’s Office of International Affairs and Office of Enforcement Operations provided invaluable support to this operation.

In Western North Carolina, U.S. Attorney Murray thanked the DEA in Charlotte, ICE’s Homeland Security Investigations, the Gastonia Police Department, the Gaston County Police Department, and the Charlotte-Mecklenburg Police Department for their investigation of the cases, which are being prosecuted by Assistant U.S. Attorney Sanjeev Bhasker, of the U.S. Attorney’s Office in Charlotte.

The cases in Western North Carolina are the result of the Organized Crime Drug Enforcement Task Force (OCDETF).  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.

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.

A federal jury sitting in Charlotte, North Carolina, has convicted the founder and chairman of a multinational investment company and a company consultant of public corruption and bribery charges, for orchestrating a bribery scheme involving independent expenditure accounts and improper campaign contributions. 

Greg E. Lindberg, 49, of Durham, North Carolina, the founder and chairman of Eli Global LLC (Eli Global) and the owner of Global Bankers Insurance Group (GBIG), and Lindberg’s consultant, John D. Gray, 69, of Chapel Hill, North Carolina, were convicted of conspiracy to commit honest services wire fraud and bribery concerning programs receiving federal funds after an approximately three-week trial before U.S. District Judge Max O. Cogburn Jr.  A third co-defendant, Eli Global executive John V. Palermo, 64, of Pittsboro, North Carolina, was acquitted by the jury.  A fourth co-defendant, Robert Cannon Hayes, 74, of Concord, North Carolina, previously pleaded guilty to making false statements to the FBI.

“Greg Lindberg and John Gray undermined public confidence in our government by promising millions of dollars in campaign contributions in exchange for government decisions to benefit Lindberg’s business interests,” said Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division.  “The department is grateful for the assistance of the law-abiding public officials who reported the attempted bribes in this case, which allowed us to use all the tools at our disposal to investigate and root out this pernicious and greedy effort to corrupt North Carolina state government.”

“The defendants devised an elaborate plan to make a hefty campaign contribution to an elected official to secure favorable action.  This was not a lapse in judgment.  It was a deliberate bribery attempt and a clear violation of federal law,” said U.S. Attorney Andrew Murray for the Western District of North Carolina.  “Public corruption is a threat to our way of life and if left unchecked it can tear apart the very fabric of our country. My office will continue to diligently ferret out public corruption schemes to protect the public and hold bad actors like these unscrupulous defendants accountable.”

“Greg Lindberg and John Gray plowed across the line from legal political donations to felonious bribery,” said Special Agent in Charge John Strong of the FBI’s Charlotte Field Office.  “These men thought they could buy changes to North Carolina Department of Insurance personnel, policies, and procedures to benefit Lindberg's businesses.  The FBI will work tirelessly to root out any and all forms of public corruption.”

According to filed court documents, witness testimony and evidence presented at trial, in January 2018, the elected Commissioner of Insurance (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. 

The evidence established that from April 2017 to August 2018, Lindberg, Gray and Hayes 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 further 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 with Hayes, 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 Stetzer and Dana Washington of the U.S. Attorney’s Office for the Western District of North Carolina are in charge of the prosecution.

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 federal jury sitting in Charlotte, North Carolina, has convicted the founder and chairman of a multinational investment company and a company consultant of public corruption and bribery charges, for orchestrating a bribery scheme involving independent expenditure accounts and improper campaign contributions. 

Greg E. Lindberg, 49, of Durham, North Carolina, the founder and chairman of Eli Global LLC (Eli Global) and the owner of Global Bankers Insurance Group (GBIG), and Lindberg’s consultant, John D. Gray, 69, of Chapel Hill, North Carolina, were convicted of conspiracy to commit honest services wire fraud and bribery concerning programs receiving federal funds after an approximately three-week trial before U.S. District Judge Max O. Cogburn Jr.  A third co-defendant, Eli Global executive John V. Palermo, 64, of Pittsboro, North Carolina, was acquitted by the jury.  A fourth co-defendant, Robert Cannon Hayes, 74, of Concord, North Carolina, previously pleaded guilty to making false statements to the FBI.

“Greg Lindberg and John Gray undermined public confidence in our government by promising millions of dollars in campaign contributions in exchange for government decisions to benefit Lindberg’s business interests,” said Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division.  “The Department is grateful for the assistance of the law-abiding public officials who reported the attempted bribes in this case, which allowed us to use all the tools at our disposal to investigate and root out this pernicious and greedy effort to corrupt North Carolina state government.”

“The defendants devised an elaborate plan to make a hefty campaign contribution to an elected official to secure favorable action.  This was not a lapse in judgment.  It was a deliberate bribery attempt and a clear violation of federal law,” said U.S. Attorney Andrew Murray for the Western District of North Carolina.  “Public corruption is a threat to our way of life and if left unchecked it can tear apart the very fabric of our country. My office will continue to diligently ferret out public corruption schemes to protect the public and hold bad actors like these unscrupulous defendants accountable.”

“Greg Lindberg and John Gray plowed across the line from legal political donations to felonious bribery,” said Special Agent in Charge John Strong of the FBI’s Charlotte Field Office.  “These men thought they could buy changes to North Carolina Department of Insurance personnel, policies, and procedures to benefit Lindberg's businesses.  The FBI will work tirelessly to root out any and all forms of public corruption.”

According to filed court documents, witness testimony and evidence presented at trial, in January 2018, the elected Commissioner of Insurance (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. 

The evidence established that from April 2017 to August 2018, Lindberg, Gray and Hayes 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 further 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 with Hayes, 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 Stetzer and Dana Washington of the U.S. Attorney’s Office for the Western District of North Carolina are in charge of the prosecution.

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. –Thuy Tien Luong, 36, was charged on March 3, 2020, in an indictment with one count of forced labor, announced Assistant Attorney General Eric Dreiband for Civil Rights and U.S. Attorney R. Andrew Murray for the Western District of North Carolina. 

According to the allegations set forth in the indictment, between late 2017 and June 26, 2018, the defendant forced the victim, whom she employed as a nail technician, to provide labor and services at her salon by means of force and threats of force to the victim. The indictment further alleges that the defendant obtained the victim’s services through means of serious harm and threats of serious harm, means of abuse and threatened abuse of law and legal process, and by means of a scheme, plan and pattern to cause the victim to believe that if she did not perform such labor and services, she would suffer serious harm.

“Human trafficking is our generation’s form of physical and psychological captivity. It is modern day slavery. These vile acts involve fundamental violations of our rights and the perpetrators must be stopped,” said Eric Dreiband, Assistant Attorney General for Civil Rights.

“Forced labor deprives victims their basic human rights and strips away their dignity.  Labor trafficking schemes are deplorable and do not have place in modern society.  My Office remains committed to combatting all forms of human trafficking and holding perpetrators accountable for their criminal actions,” said U.S. Attorney Murray.

“Traffickers treat human beings as commodities. They use force, fraud or coercion to prey on people’s vulnerabilities,” said Homeland Security Investigations (HSI) Charlotte Special Agent in Charge Ronnie Martinez. “HSI special agents will continue to focus their efforts on eradicating this heinous crime; no one should be subject to human trafficking.”

An indictment is merely an accusation, and the defendant is presumed innocent unless proven guilty.  If convicted of forced labor, the defendant faces a sentence of up to 20 years in prison, as well as mandatory restitution.

The case is being investigated by the Department of Homeland Security, Homeland Security Investigations with assistance from the Davidson Police Department and Charlotte-Mecklenburg Police Department.  It is being prosecuted by Assistant United States Attorney Kimlani M. Ford for the Western District of North Carolina and Trial Attorney Maryam Zhuravitsky for the Civil Rights Division’s Human Trafficking Prosecution Unit.

ASHEVILLE, N.C. – U.S. Attorney Andrew Murray announced today that Derek Shawn Pendergraft, 22, of Asheville, has been sentenced to life in prison, for the murder of his co-worker, Sara Ellis. U.S. District Judge Martin Reidinger presided over today’s sentencing hearing.

John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division; Neal D. Labrie, Chief Ranger of the Blue Ridge Parkway; and Robert Schurmeier, Director of the North Carolina State Bureau of Investigation (SBI), join U.S. Attorney Murray in making this announcement.

“When a life is cut short at the hands of another individual, no prison sentence is ever long enough to make things right for the victim’s loved ones,” said U.S. Attorney Murray. “Today’s sentence will not bring back Sara to her family and friends who miss her and think about her every day, but it is my sincere hope that everyone impacted by this heinous crime can find solace in knowing that Sara’s killer will never walk free among us again.”

According to filed court documents and statements made in court, on July 24, 2018, Pendergraft, who worked at the Pisgah Inn, murdered his co-worker, Sara Ellis, during the perpetration of aggravated sexual abuse. The murder occurred on the Blue Ridge Parkway, within the special territorial jurisdiction of the United States, and within the Western District of North Carolina.

On August 26, 2019, Pendergraft pleaded guilty to first degree murder and two counts of aggravated sexual abuse resulting in death. 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.  All federal sentences are served without the possibility of parole.

In making today’s announcement, U.S. Attorney Murray commended the National Park Service, the FBI, and the SBI for their investigation of the case, and thanked the Transylvania County Sheriff's Office, the Haywood County Sheriff’s Office, and the Cruso Fire Department for their invaluable assistance. 

Assistant U.S. Attorneys Don Gast and John Pritchard, of the U.S. Attorney’s Office in Asheville, prosecuted the case.

CHARLOTTE, N.C. – U.S. Attorney Andrew Murray announced that Daniel John Hodges, 25, of Concord, N.C. appeared in federal court today before U.S. Magistrate Judge David C. Keesler, and pleaded guilty to unlawful distribution of anabolic steroids.

Robert J. Murphy, Special Agent in Charge of the Atlanta Field Division of the Drug Enforcement Administration (DEA), which oversees the Charlotte Office, joins U.S. Attorney Murray in making today’s announcement.

According to plea documents filed in the case and today’s plea hearing, from about September 2018 to September 2019, Hodges did knowingly possess with intent to distribute anabolic steroids, including Testosterone Enanthane, Dianabol, Anavar, and Winstrol.  Hodges further admitted to possessing between 20,000 and 40,000 units of anabolic steroids, and maintaining a premises for the the purpose of manufacturing or distributing a controlled substance. Over the course of the investigation, law enforcement also seized an electronic and a manual pill press/tableting machine that belonged to Hodges, often used to manufacture consumable steroid products. According to statements made in court during the plea hearing, Hodges obtained the substances unlawfully from a source of supply in China, and used, among other things, social media to advertise to and conduct transactions with customers. 

Following the plea hearing, Hodges was released on bond.  The charge of possession with intent to distribute an anabolic steroid carries a maximum prison term of ten years and a $500,000 fine. A sentencing date has not been set.

In making today’s announcement, U.S. Attorney Murray thanked the DEA, the Cabarrus County Sherriff’s Office, and the Cabarrus County District Attorney’s Office for their investigation and coordination of this case.

Assistant U.S. Attorney Mark T. Odulio, of the U.S. Attorney’s Office in Charlotte, is handling the prosecution.

ASHEVILLE, N.C. – A federal grand jury sitting in Charlotte returned a criminal bill of indictment on February 20, 2020, charging Shannon White, 42, an enrolled member of the Eastern Band of Cherokee Indians and resident of the Cherokee Indian Reservation, with distributing fentanyl that resulted in an overdose death, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.  White appeared in federal court this morning, following her arrest by the DEA and the Swain County Sheriff’s Office.

Robert J. Murphy, Special Agent in Charge of the Atlanta Field Division of the Drug Enforcement Administration (DEA), which oversees the Asheville District Office, and the counties encompassing the Cherokee Indian Reservation, joins U.S. Attorney Murray in making today’s announcement.

The criminal bill of indictment alleges that on January 28, 2019, White did knowingly distribute a mixture or substance containing fentanyl, a Schedule II controlled substance, which resulted in the death of a victim identified in the indictment as J.F.

White had her initial appearance today in Asheville before U.S. Magistrate Judge W. Carleton Metcalf. The offense charged carries a mandatory minimum term of twenty years imprisonment, a maximum term of life imprisonment, and a $1,000,000 fine.

The charge contained in the indictment is an allegation.  The defendant is innocent until proven guilty beyond a reasonable doubt in a court of law.

In making today’s announcement, U.S. Attorney Murray thanked the DEA and the Swain County Sheriff’s Office for their investigation of this case. Assistant U.S. Attorney Thomas Kent, of the U.S. Attorney’s Office in Asheville, is handling the prosecution.

Last month, U.S. Attorney Murray was joined by the U.S. Attorneys for the Middle and Eastern Districts of North Carolina and the District of South Carolina, in calling on Congress to issue a permanent ban on fentanyl and its analogues.  Congress passed a 15-month extension on DEA’s existing ban on all variants of fentanyl, which President Trump signed into law on February 6, 2020.  The current extension expires on May 6, 2021.

“While I am thankful that Congress extended the temporary ban on fentanyl and fentanyl-like analogues, I join law enforcement and prosecutors across the nation in calling for action to permanently outlaw this deadly substance and all its derivatives.  Temporary bans are the equivalent of putting a Band-Aid on a gushing wound. We need a permanent fix. Fentanyl and fentanyl analogues kill people and devastate communities.  These drugs belong in same legal category as heroin and other deadly substances,” said U.S. Attorney Murray. 

U.S. Attorney Murray’s joint op-ed can be accessed here. More information about fentanyl and fentanyl analogues can be found here.

CHARLOTTE, N.C. - Wells Fargo & Company and its subsidiary, Wells Fargo Bank, N.A., have agreed to pay $3 billion to resolve their potential criminal and civil liability stemming from a practice between 2002 and 2016 of pressuring employees to meet unrealistic sales goals that led thousands of employees to provide millions of accounts or products to customers under false pretenses or without consent, often by creating false records or misusing customers’ identities, the Department of Justice announced today.

As part of the agreements with the United States Attorney’s Offices for the Western District of North Carolina and the Central District of California, the Commercial Litigation Branch of the Civil Division, and the Securities and Exchange Commission, Wells Fargo admitted that it collected millions of dollars in fees and interest to which the Company was not entitled, harmed the credit ratings of certain customers, and unlawfully misused customers’ sensitive personal information, including customers’ means of identification.

"When companies cheat to compete, they harm customers and other competitors," said Deputy Assistant Attorney General Michael D. Granston of the Department of Justice’s Civil Division. "This settlement holds Wells Fargo accountable for tolerating fraudulent conduct that is remarkable both for its duration and scope, and for its blatant disregard of customer’s private information. The Civil Division will continue to use all available tools to protect the American public from fraud and abuse, including misconduct by or against their financial institutions."

"Our settlement with Wells Fargo, and the $3 billion monetary penalty imposed on the bank, go far beyond ‘the cost of doing business.’ They are appropriate given the staggering size, scope and duration of Wells Fargo’s illicit conduct, which spanned well over a decade," said U.S. Attorney Andrew Murray for the Western District of North Carolina. "When a reputable institution like Wells Fargo caves to the pernicious forces of greed, and puts its own interests ahead of those of the customers it claims to serve, my office will not sit idle. Today’s

announcement should serve as a stark reminder that no institution is too big, too powerful, or too well-known to be held accountable and face enforcement action for its wrongdoings."

"This case illustrates a complete failure of leadership at multiple levels within the Bank. Simply put, Wells Fargo traded its hard-earned reputation for short-term profits, and harmed untold numbers of customers along the way," said U.S. Attorney Nick Hanna for the Central District of California. "We are hopeful that this $3 billion penalty, along with the personnel and structural changes at the Bank, will ensure that such conduct will not reoccur."

"Our office is committed to bringing to justice those who deliberately falsify and fabricate bank records in order to deceive regulators and the public," said Inspector General Mark Bialek of the Board of Governors of the Federal Reserve System and Bureau of Consumer Financial Protection. "I commend our agent and our law enforcement partners for their hard work and persistence that led to today’s announcement."

"Today’s multi-billion-dollar penalty holds Wells Fargo accountable for its unlawful sales practices and pressure tactics in which it deceived millions of clients, thus causing substantial hardship for the very individuals who placed their trust in the institution," said Inspector General Jay N. Lerner Federal Deposit Insurance Corporation. "The FDIC Office of Inspector General is committed to working with our law enforcement partners in order to investigate such financial crimes that harm customers and investors, and undermine the integrity of the banking sector."

The criminal investigation into false bank records and identity theft is being resolved with a deferred prosecution agreement in which Wells Fargo will not be prosecuted during the three-year term of the agreement if it abides by certain conditions, including continuing to cooperate with further government investigations. Wells Fargo also entered a civil settlement agreement under the Financial Institutions Reform, Recovery and Enforcement Act of 1989 (FIRREA) based on Wells Fargo’s creation of false bank records. FIRREA authorizes the federal government to seek civil penalties against financial institutions that violate various predicate criminal offenses, including false bank records. Wells Fargo also agreed to the SEC instituting a cease-and-desist proceeding finding violations of Section 10(b) of the Exchange Act and Rule 10b-5 thereunder. The $3 billion payment resolves all three matters, and includes a $500 million civil penalty to be distributed by the SEC to investors.

The 16-page statement of facts accompanying the deferred prosecution agreement and civil settlement agreement outlines a course of conduct over 15 years at Well Fargo’s Community Bank, which was then the largest operating segment of Wells Fargo, consistently generating more than half of the company’s revenue. The statement of facts outlines top Community Bank leaders’ knowledge of the conduct. As part of the statement of facts, Wells Fargo admitted the following:

Beginning in 1998, Wells Fargo increased its focus on sales volume and reliance on annual sales growth. A core part of this sales model was the "cross-sell strategy" to sell existing customers additional financial products. It was "the foundation of our business model," according to Wells Fargo. In its 2012 Vision and Values statement, Wells Fargo stated: "We start with what the customer needs – not with what we want to sell them."

But, in contrast to Wells Fargo’s public statements and disclosures about needs-based selling, the Community Bank implemented a volume-based sales model in which employees were directed and pressured to sell large volumes of products to existing customers, often with little regard to actual customer need or expected use. The Community Bank’s onerous sales goals and accompanying management pressure led thousands of its employees to engage in unlawful conduct – including fraud, identity theft and the falsification of bank records – and unethical practices to sell product of no or little value to the customer.

Many of these practices were referred to within Wells Fargo as "gaming." Gaming strategies varied widely, but included using existing customers’ identities – without their consent – to open checking and savings, debit card, credit card, bill pay and global remittance accounts. From 2002 to 2016, gaming practices included forging customer signatures to open accounts without authorization, creating PINs to activate unauthorized debit cards, moving money from millions of customer accounts to unauthorized accounts in a practice known internally as "simulated funding," opening credit cards and bill pay products without authorization, altering customers’ true contact information to prevent customers from learning of unauthorized accounts and prevent Wells Fargo employees from reaching customers to conduct customer satisfaction surveys, and encouraging customers to open accounts they neither wanted or needed.

The top managers of the Community Bank were aware of the unlawful and unethical gaming practices as early as 2002, and they knew that the conduct was increasing due to onerous sales goals and pressure from management to meet these goals. One internal investigator in 2004 called the problem a "growing plague." The following year, another internal investigator said the problem was "spiraling out of control." Even after senior managers in the Community Bank directly called into question the implementation of the cross-sell strategy, Community Bank senior leadership refused to alter the sales model, which contained unrealistic sales goals and a focus on low-quality secondary accounts.

Despite knowledge of the illegal sales practices, Community Bank senior leadership failed to take sufficient action to prevent and reduce the incidence of such practices. Senior leadership of the Community Bank minimized the problems to Wells Fargo management and its board of directors, by casting the problem as driven by individual misconduct instead of the sales model itself. Community Bank senior leadership viewed negative sales quality and integrity as a necessary byproduct of the increased sales and as merely the cost of doing business.

* * *

The government’s decision to enter into the deferred prosecution agreement and civil settlement took into account a number of factors, including Wells Fargo’s extensive cooperation and substantial assistance with the government’s investigations; Wells Fargo’s admission of wrongdoing; its continued cooperation in the investigations; its prior settlements in a series of regulatory and civil actions; and remedial actions, including significant changes in Wells Fargo’s management and its board of directors, an enhanced compliance program, and significant work to identify and compensate customers who may have been victims. The deferred prosecution agreement will be in effect for three years.

The global settlement also reflects coordination between the Department of Justice and the SEC to ensure a resolution that appropriately addresses the severity of the defendants’ conduct while avoiding the imposition of fines and penalties that are unnecessarily duplicative.

The deferred prosecution agreement was handled by the United States Attorney’s Offices in Charlotte and Los Angeles, with investigative support from the Federal Bureau of Investigation, the Federal Deposit Insurance Corporation - Office of Inspector General, the Federal Housing Finance Agency - Office of Inspector General, the Office of Inspector General for the Board of Governors of the Federal Reserve System and Consumer Financial Protection Bureau, and the United States Postal Inspection Service.

The civil settlement agreement was the result of a coordinated effort between the Civil Division’s Commercial Litigation Branch and the U.S. Attorney’s Office in Los Angeles.

# # #

ASHEVILLE, N.C. – A criminal bill of indictment has been unsealed in federal court in Asheville following the arrest of Mark Nicholas Pyatt in North Dakota, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.  The indictment charges the 40-year-old former resident of Haywood County with securities fraud, wire fraud, investment adviser fraud, and money laundering.

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

According to allegations contained in the indictment, beginning as early as October 2017, and continuing through at least February 2019, Pyatt, often using the alias Daniel G. Randolph, solicited friends and acquaintances to invest their money in a “communal account,” or “fund,” held by his company, Winston Reed Investments, LLC (WRI).  As alleged in the indictment, Pyatt represented to his victim-investors that he had made significant amounts of money through his own investing and day trading activities, and that he wanted to invest the victims’ money using a similar strategy so that they could experience the same wealth that he enjoyed. 

The indictment alleges that, in order to induce the victims to part with their money, Pyatt made a number of false and fraudulent representations.  Pyatt told the investors that he would make trades with the investors’ money on a daily basis, that he would be trading futures and forex, and that he would specialize in energy-related stocks. Pyatt also falsely promised large returns on investments, assuring victims that the “low average expected return on investments” would be 15% per month, with a goal of a return of 100% in three to four months.  Pyatt represented to his victims that he would receive a fee for WRI’s services of just 10% of all gains, and that he would not charge his investors any fees if he did not make a profit.

According to the allegations in the indictment, contrary to the promises he made to his victim-investors, Pyatt simply stole the vast majority of the investors’ money.  The indictment alleges that Pyatt misappropriated over $100,000 to pay for personal expenses, including jewelry, groceries, cigars, and a Chevrolet Corvette.  Pyatt also withdrew tens of thousands of dollars in cash, and made several Ponzi-style payments to his investors, falsely implying that the returned funds were trading profits. 

As alleged in the indictment, Pyatt perpetuated the fraud by making misrepresentations to victim-investors about the fund’s performance.  For example, for months, Pyatt regularly provided his investors with false updates that purported to describe his trading activity and the considerable positive returns he was earning on their investments.  Then, in February 2019, after reporting substantial monthly gains to his investors for more than a year, Pyatt allegedly notified his investors by email that a “complete and catastrophic” loss had occurred, and that their money was gone.  Pyatt allegedly claimed that he was investigating the loss with the assistance of a forensics firm, and he told his investors that the loss was due to a technical oversight or failure by the brokerage firm holding the investment account.  According to the indictment, all of these representations were false; in reality, the money was gone because Pyatt spent it.  

The indictment further alleges that, during at least a substantial portion of the scheme, Pyatt resided in Haywood County and targeted local victims.  In total, the indictment alleges that Pyatt stole at least $218,000 from his victim investors, many of whom were at, or near, retirement age.

Pyatt had his initial appearance in the U.S. District Court in the District of North Dakota, and will have a court appearance in the Western District of North Carolina at a later date.

The wire fraud charge carries a maximum prison term of 20 years and a maximum fine that is the greatest of $250,000 or twice the gross gain or gross loss.  The securities fraud charge carries a maximum prison term of 20 years and a maximum fine of $5,000,000.  The maximum penalty for the investment adviser fraud charge is five years in prison and a $10,000 fine.  The money laundering charge carries a maximum prison term of 10 years and a maximum fine that is the greater of $250,000 or twice the amount of criminally derived property involved in the transaction.

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

Today, the Commodity Futures Trading Commission (CFTC) and the U.S. Securities & Exchange Commission (SEC) also announced separate civil actions filed with the U.S. District Court in the Western District of North Carolina against WRI and Pyatt.

In making today’s announcement, U.S. Attorney Murray commended the Haywood County Sheriff’s Office, the SBI, and HSI for their aid in the investigation of the criminal case, and thanked the CFTC and SEC for their continued cooperation.

Assistant U.S. Attorney Daniel Bradley, of the U.S. Attorney’s Office in Asheville, is in charge of the prosecution.

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. – Chief U.S. District Judge Frank D. Whitney sentenced today Marcus Damar Massey, 34, of Monroe, N.C. to 100 months in prison, followed by two years of supervised release for a firearms offense, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. 

Ronnie Martinez, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) in Charlotte, and Chief J. Bryan Gilliard of the Monroe Police Department, join U.S. Attorney Murray in making today’s announcement.

On September 5, 2019, Massey pleaded guilty to possessing two firearms, a loaded 12 gauge shotgun, and a 9mm pistol. Massey has prior felony convictions and is prohibited from possessing a firearm and ammunition. At today’s sentencing hearing, Massey received an enhanced sentence in accordance with the United States Sentencing Guidelines, based on evidence presented by the government in support of an attempted murder enhancement.  According to information contained in court documents and today’s sentencing hearing, Massey was found in possession of the two weapons on May 12, 2018.  At the time, officers with the Monroe Police Department were investigating a shooting incident that occurred two weeks prior on April 29, 2018, at the intersection of Fairly Avenue and Morgan Mill Road, in Monroe.  Law enforcement officers investigating the incident collected five 9mm shell casings at the scene, and observed three bullet holes in the passenger side of the vehicle driven by the victim. Over the course of the investigation, law enforcement identified Massey as the shooter and the 9mm pistol as the weapon used in the April 29th shooting.

Massey is currently in custody and will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility.  Federal sentences are served without the possibility of parole. 

In making today’s announcement, U.S. Attorney Murray thanked HSI and the Monroe Police Department for handling the investigation. Assistant U.S. Attorney William Bozin, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.

CHARLOTTE, N.C. – A bill of indictment was unsealed in federal court today, charging Bryan Lee Ragon, 43, of Charlotte, with sex trafficking of a minor, production of child pornography, transportation of a minor, and receipt of child pornography, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.  The indictment was returned by a grand jury sitting in Charlotte on Tuesday, February 18, 2020, and was unsealed following Ragon’s arrest this morning.

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

The criminal indictment charges Ragon with allegedly sex trafficking a minor in the Western District of North Carolina, Wisconsin, and elsewhere, from December 16, 2015, to December 31, 2015.  The indictment also alleges that in December 2015, Ragon knowingly produced a visual depiction of the minor engaging in sexually explicit conduct, and that he knowingly transported the minor across state lines for the purpose of engaging in illegal sexual activity. The indictment further alleges that, in December 2015, Ragon received material containing child pornography.

Ragon had his initial appearance in federal court in Charlotte before U.S. Magistrate Judge David C. Keesler and remains in federal custody.  Ragon’s next court hearing has been scheduled for Tuesday, February 25, 2020, at 11:35 a.m.

The sex trafficking of a minor charge carries a mandatory minimum penalty of 10 years and a maximum of life in prison.  The production of child pornography charge carries a mandatory minimum penalty of 15 years and a maximum of 30 years in prison. The transportation of a minor charge carries a mandatory minimum penalty of 10 years and a maximum of life in prison. The receipt of child pornography charge carries a mandatory minimum of five years and a maximum of 20 years in prison.

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

In making today’s announcement, U.S. Attorney Murray commended HSI and SBI for their investigation of this case, which led to the federal charges, and thanked the Charlotte-Mecklenburg Police Department for their assistance with Ragon’s arrest today.  U.S. Attorney Murray also thanked the Wisconsin Department of Justice Division of Criminal Investigation for their invaluable assistance and the U.S. Attorney’s Office for the Western District of Wisconsin for their continued cooperation and coordination.

Assistant U.S. Attorney Emily Wasserman, of the U.S. Attorney’s office in Charlotte, is handling the prosecution.  

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.

STATESVILLE, N.C. – U.S. District Judge Kenneth D. Bell sentenced yesterday Ronnie Dean Brown, 36, of North Wilkesboro, N.C., to 121 months in prison on child pornography charges, announced the U.S. Attorney’s Office for the Western District of North Carolina. Brown was also sentenced to a lifetime of supervised release and was ordered to register as a sex offender after he is released from prison.

Ronnie Martinez, Special Agent in Charge of ICE/Homeland Security Investigations (HSI) in North Carolina, and Sheriff Chris Shew of the Wilkes County Sheriff’s Office, join the U.S. Attorney’s office in making today’s announcement.

According to filed documents and statements made in court, in September 2018, law enforcement became aware that an individual, later identified as Ronnie Brown, was accessing child pornography online. In October 2018, law enforcement approached Ronnie Brown, who was at Charlotte Douglas Airport on his way to Las Vegas.  Court records show that Ronnie Brown refused to cooperate with law enforcement, and afterwards contacted his wife, Kelly Brown, and instructed her to “get rid of his laptop.”  Kelly Brown did as instructed and gave the laptop to another individual, who later turned it over to law enforcement.

Law enforcement executed a search warrant at Ronnie Brown’s residence and seized a computer and portable storage media.  According to court records, a forensic examination of the seized items revealed that Ronnie Brown possessed more than 4,100 images of children, including infants and toddlers, engaging in sexually explicit conduct.  Some of the child pornography depicted sadistic and masochistic conduct.

On October 3, 2019, Ronnie Brown pleaded guilty to receipt of child pornography. He is currently in custody and will be transferred to the custody of the Federal Bureau of Prisons upon designation of a federal facility.  Federal sentences are served without the possibility of parole.

Kelly Brown previously admitted to giving her husband’s laptop to another individual according to his instructions, in an attempt to prevent law enforcement from seizing it.  Kelly Brown further admitted that when she followed Ronnie Brown’s instructions, she and her husband were both aware that law enforcement were conducting an investigation into child pornography.  Kelly Brown has pleaded guilty to a federal felony related to her obstruction of the investigation and is currently awaiting sentencing.

HSI and the Wilkes County Sheriff’s Office conducted the investigation.

Assistant U.S. Attorney Alfredo De La Rosa, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.

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.

"The Sheriffs of Mecklenburg and Buncombe Counties have adopted ‘sanctuary’ policies that endanger our communities and shield criminals from immigration enforcement.

"In 2019, the Mecklenburg County Sheriff’s Office alone failed to honor over 200 detainers issued by U.S. Immigration and Custom Enforcement (ICE), which means that more than a couple of hundred criminal aliens charged with criminal offenses were released back to the community. And those are the ones we can account for.

"By ignoring federal immigration detainers and administrative warrants, and refusing to simply inform ICE officers when an unlawful alien who has committed a criminal act is due to be released to the community, the Sheriffs of Mecklenburg and Buncombe Counties prioritize the protection of criminal aliens above the safety and protection of our communities.

"Rather than uphold our nation’s laws, the Sheriffs compromise the safety of the people they swore to serve and protect. Regardless of the crime the removable aliens have committed; regardless of whether they assaulted women or raped children; regardless of whether they trafficked deadly drugs; and regardless of the likelihood they will commit more crime as soon as they return to the community, criminal aliens are permitted to walk out of prison, free to reoffend in communities they had no right to be in the first place.

"The common-sense approach of removing illegal aliens who have committed a criminal act currently in place in other North Carolina jurisdictions works extremely well. After illegal aliens have been arrested and charged with a crime, they are fingerprinted and booked into jail. When federal immigration authorities learn that a criminal alien who has been arrested is in a jurisdiction’s custody, ICE officers issue a detainer request accompanied by a civil arrest warrant, and ask the sheriff’s office to either notify them before the criminal alien is released, or hold the charged individual long enough to arrange a transfer to federal custody in a safe setting.

"But Mecklenburg and Buncombe County Sheriffs refuse to honor ICE detainers, purporting their hands are tied because these formal detainers are not sufficiently ‘legal’ enough to hold criminal aliens in custody. Their stance is so extreme, that the Sheriffs not only fail to honor a detainer by briefly holding a criminal alien of interest for ICE, they refuse to even make a courtesy call to ICE officers notifying them that a defendant has either satisfied bail conditions or served a jail sentence and is being processed for release.

"So, instead of protecting their communities and cooperating with law enforcement partners, the Sheriffs play the blame-game and instead point their fingers at a flawed judicial system and the absence of federal criminal charging documents for the criminals they have chosen to let loose.

"This blame-game is a complete fallacy. The Sheriffs are well aware that state crimes are not necessarily federal offenses, and even if they are, ICE needs additional time to verify the proper identification of the criminal alien along with prior criminal history and deportations, and gather any additional evidence before presenting a case to the U.S. Attorney’s Office. Once a case is in the federal prosecutors’ hands, an internal review process, which includes supervisory oversight, ensures federal charges are appropriate and the defendant’s identity and status have been thoroughly vetted.

"The Sheriffs claim that releasing into our communities criminal aliens – many of whom have extensive criminal histories - boosts the confidence of immigrant communities in law enforcement, increases their trust in law enforcement, and sends the message that law enforcement are working hard to make their streets safer. That notion is false and dangerous. Upon release from custody, criminal aliens oftentimes seek a safe harbor by returning to the same immigrant communities, where they are prone to reoffend. Ultimately, the Sheriffs’ misguided stance puts the very communities they purport to respect and protect in increased danger, and puts the lives of our law enforcement officers and the public at large at an increased risk of harm.

"When criminal aliens are released, law enforcement officers are forced to go into unknown and potentially dangerous situations to locate and re-arrest the same criminals that could have been taken into custody in the controlled and weapon-free environment of a jail. Instead, the Sheriffs’ current nonsensical policy protects criminals and needlessly endangers the lives of their fellow law enforcement officers, who simply want to do their jobs well and as safely as possible, so that they, too, can return to their loved ones at the end of their work day.

"Equally noteworthy is the fact that collateral consequences are also a real possibility whenever law enforcement attempts to place someone in custody in a dynamic environment like a vehicle stop or a residential arrest. Innocent bystanders in the vicinity are at risk of harm when a known criminal chooses "fight or flight" rather than peaceful compliance with law enforcement. As we’ve seen in recent months, such dangerous encounters can lead to police stand-offs and shootings.

"I urge the Sheriffs of Mecklenburg and Buncombe Counties to do the job they were elected to do, protect every single member of the community from increased risk of harm, and stop needlessly and irresponsibly thrusting fellow law enforcement officers into harm’s way.

"The people of our communities deserve more and have a right to expect their Sheriffs to do all they can to make our streets safe, and our communities a place where we can live, work, and raise our families.

"As a former federal law enforcement officer with the U.S. Coast Guard, a former District Attorney for Mecklenburg County, and currently as U.S. Attorney for Western North Carolina, I can attest that cooperation and coordination between local, state, and federal law enforcement is the only effective strategy that can make our crime fighting efforts successful and stem the tide of increased violence. United we stand and divided we fail.

"I call upon the Sheriffs of Mecklenburg and Buncombe Counties to abandon their misguided sanctuary policies that do nothing but shield criminals, put at risk the safety of our neighborhoods, and jeopardize the lives of law enforcement officers.

Let’s work together to make all of our communities as safe as possible and let’s do everything in our power to prevent the loss of innocent life."

ASHEVILLE, N.C. – Today, U.S. District Judge Max O. Cogburn Jr. sentenced a South Carolina man to 168 months in prison and four years of supervised release for trafficking heroin and crack cocaine, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. Veto Omar Martin, 41, of Anderson, S.C., received an enhanced prison sentence and was sentenced as a Career Offender due to his multiple prior drug trafficking convictions.

John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, and Chief David Zack of the Asheville Police Department (APD), join U.S. Attorney Murray in making today’s announcement.

According to court documents and today’s sentencing hearing, on November 30, 2018, officers with the Asheville Police Department’s Drug Suppression Unit executed a search warrant at a residence, and a vehicle parked in the driveway of the residence, in Asheville.  While executing the search warrant, law enforcement recovered from inside the home narcotics and various drug paraphernalia.  Law enforcement also arrested Martin, who was sitting in the driver’s seat of the parked vehicle. Inside the vehicle, law enforcement located heroin, crack cocaine, and other narcotics.  According to court records, over the course of the investigation, Martin admitted to selling drugs in Asheville and surrounding areas, and using the Asheville residence to sell narcotics. 

In October 2019, Martin pleaded guilty to possession with intent to distribute narcotics. He is currently in custody and will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility.  All federal sentences are served without the possibility of parole.

In making today’s announcement, U.S. Attorney Murray thanked the FBI and APD for handling the investigation.

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

ASHEVILLE, N.C. – David Paul George Sr., 56, of Cherokee, N.C., was sentenced today to 51 months in prison for the sexual abuse of a minor in Indian Country, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. In addition to the prison term imposed, U.S. District Judge Max O. Cogburn Jr. also ordered George to serve 15 years under court supervision, and to register as a sex offender after he is released from prison.

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

According to court documents and today’s sentencing hearing, between March and May 2018, George, who is an enrolled member of the Eastern Band of Cherokee Indians, sexually abused a minor female entrusted in his care.  As George previously admitted in court, the defendant sexually abused the victim on multiple occasions.  The sexual abuse took place in Swain County, within the boundaries of the Indian reservation.  

George has been in federal custody since June 2019. He will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility.  All federal sentences are served without the possibility of parole.

In making today’s announcement, U.S. Attorney Murray thanked the Cherokee Indian Police Department for their investigation of this case.

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

CHARLOTTE, N.C. – Late yesterday, U.S. District Judge Max O. Cogburn Jr. sentenced Garlin Raymond Farris, 57, of Mathews, N.C. to 288 months in prison and five years of supervised release for trafficking large amounts of methamphetamine, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.

Vincent C. Pallozzi, Special Agent in Charge of the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Charlotte Field Division, joins U.S. Attorney Murray in making today’s announcement.

According to court documents and today’s sentencing hearing, from 2016 through the summer of 2017, Farris trafficked significant amounts of methamphetamine throughout Western North Carolina. Court records show that Farris supervised a network of distributors, who sold his drugs throughout Mecklenburg, Watauga, Catawba, and Alexander Counties. Farris and his distributors made frequent trips to supply sources located in Atlanta, Georgia.  During those trips, Farris personally picked up at least 50 kilograms of methamphetamine and then brought the drugs back into North Carolina for distribution.

In April 2019, a federal jury convicted Farris of conspiracy to traffic methamphetamine.  He is currently in custody and will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility.  All federal sentences are served without the possibility of parole.

In making today’s announcement, U.S. Attorney Murray thanked the ATF for handling the investigation.

Assistant U.S. Attorney Erik Lindahl, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.

CHARLOTTE, N.C. – Otequise Lenard Miller, 34, of Concord, N.C. was sentenced today to 240 months in prison and five years of supervised release on drug trafficking conspiracy resulting in an overdose death and money laundering charges, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. 

Robert J. Murphy, Special Agent in Charge of the Atlanta Field Division of the Drug Enforcement Administration (DEA), which oversees the Charlotte District Office; Ronnie Martinez, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Charlotte; Chief Gary J. Gacek of the Concord Police Department; and Interim Chief Terry Spry of the Kannapolis Police Department join U.S. Attorney Murray in making today’s announcement.

According to filed court documents and today’s sentencing hearing, from 2015 until his arrest on August 22, 2018, Miller was part of a drug conspiracy that trafficked bulk crystal methamphetamine and heroin into Mecklenburg County.  During the relevant time period, Miller trafficked approximately seven to nine kilograms of heroin, and 14 to 18 kilograms of crystal methamphetamine.  In addition to drug trafficking, Miller concealed and laundered the drug proceeds.  

Court records show that, in December 2017, Miller sold heroin to a victim identified in court documents as “W.M.,” which resulted in the victim’s overdose death.  As described further in court documents, Miller continued to sell narcotics even after he became aware of the victim’s death.  Miller is a repeat offender, and was previously convicted of drug trafficking charges.

Miller is currently in custody and will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility.  All federal sentences are served without the possibility of parole.

This case is part of the U.S. Attorney’s Office initiative to combat the opioid abuse epidemic in the Western District of North Carolina through prosecution, enforcement and prevention. 

In June 2019, U.S. Attorney Murray announced the formation of the Western District’s Heroin and Opioid Prevention and Enforcement (H.O.P.E.) Task Force.  This multi-agency team of experienced federal and state investigators located in the Western District of North Carolina work with federal prosecutors to identify abusive practices by participants in the opioid pharmaceutical supply chain, and to prosecute drug trafficking networks that distribute lethal heroin and opioids into our communities. 

The Task Force focuses on coordinating investigations, information sharing, identifying trends throughout the region, investigating whistleblower complaints, and the creation of cross-agency investigative teams so each agency task force member can bring its area of expertise on investigations.  

The Task Force builds upon existing partnerships between the agencies, and its work reflects a heightened effort to reduce heroin and opioid abuse, to increase prevention through outreach efforts, and to educate the public about the dangers of counterfeit drugs, heroin abuse and opioid addiction.

This prosecution is also part of an extensive investigation by the Organized Crime Drug Enforcement Task Force (OCDETF), targeting the importation of narcotics from Mexico into Western North Carolina. 

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.

DEA, HSI, the Concord Police Department, and the Kannapolis Police Department investigated the case. 

Assistant U.S. Attorney Sanjeev Bhasker, of the U.S. Attorney’s Office in Charlotte, is in charge of the prosecution.

CHARLOTTE, N.C. – Kimberlie L. Flemings, 51, of Mount Holly, N.C., was sentenced today to 57 months in prison and two years of supervised release, for her role in a $1 million fraudulent car loan scheme, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. U.S. District Judge Robert J. Conrad Jr. also ordered Flemings to pay more than $600,000 in restitution.

In October 2018, a federal jury convicted Flemings of conspiracy to commit wire and bank fraud, wire fraud affecting financial institutions, and multiple counts of financial institution fraud.

Two of Flemings’s co-conspirators, Stanley Reginald Barron, and Brian Lyles, previously were sentenced to 18 months and 15 months in prison, respectively, for their involvement in the scheme.

According to today’s sentencing hearing, filed court documents, and evidence presented at Flemings’s trial, from at least 2012 to 2015, Flemings, Barron, Lyles, and others submitted dozens of fraudulent automobile and personal loan applications in their own names, as well as the names of more than 30 other individuals, to at least 19 banks and credit unions. As part of the scheme, loan applications were submitted in the name of a deceased individual and a disabled, elderly veteran. To facilitate the fraud, the co-conspirators created fake automobile dealerships that purported to be the sellers of vehicles purchased with the fraudulent loans. The co-conspirators also set up bank accounts, websites, and addresses associated with these fake automobile dealerships, and created fictitious purchase orders, which were submitted to the financial institutions as part of the loan application. As a result of the fraudulent applications, the co-conspirators obtained more than $1 million in fraudulent loan proceeds. 

Flemings, Barron and Lyles generally deposited the fraudulently obtained checks from the financial institutions into accounts Barron controlled. After keeping a portion of the proceeds, Barron distributed the rest to Flemings, Lyles, and others.  According to court records, the majority of the loans defaulted, causing losses to the defrauded financial institutions.  To cover up the fraud, the co-conspirators made false statements to the banks and credit unions that attempted to collect on the debts, including that borrowers had been the victims of identity theft and that they had not authorized the loans.

In announcing Fleming’s sentence, Judge Conrad highlighted Flemings’ “many acts of fraudulent conduct” over the course of several years and emphasized the need to further the sentencing goals of general and specific deterrence and to protect the public from future crimes. 

In making today’s announcement U.S. Attorney Murray thanked the United States Postal Inspection Service (USPIS) and the Office of Inspector General of the Federal Housing Finance Agency for their investigation of the case, and recognized the North Carolina Division of Motor Vehicles for their assistance.  

Assistant U.S. Attorneys Daniel Ryan and Taylor J. Philips of the U.S. Attorney’s Office in Charlotte are in charge of the prosecution. 

In 2017, nearly 50,000 Americans died from an opioid overdose.  In 2018, synthetic opioids accounted for over 28,000 overdose fatalities across the United States.  Hundreds of those victims died here, in the Carolinas.  They were our friends, our colleagues, our neighbors.  And while we are encouraged by a recent decline in the reported death toll, the untimely loss of any life to this drug scourge is too great of a tragedy.  As law enforcement leaders, this epidemic requires our continued and sustained attention.

One of the deadliest synthetic opioids is fentanyl, a drug 50 times more potent than heroin, and 100 times more powerful than morphine.  Incredibly small quantities – measured like the grains of salt – can kill the average person. 

Illegal fentanyl is manufactured in high-volume labs in China and Mexico, and its chemical structure is easily altered to create new drugs, called fentanyl analogues. Analogues can be created simply by altering just a single molecule.  

Prior to 2018 drug traffickers were able to run sophisticated operations and evade law enforcement and prosecution by altering the chemical composition of fentanyl just enough to skirt the law. Even more frightening, the compounding done in illicit labs varies so much that no one can be sure of the amount they are ingesting.

To address this problem, in 2018, the Drug Enforcement Administration (DEA) used its authority to temporarily ban all fentanyl-related substances and closed a loophole used by drug traffickers to exploit our laws and profit off our people. 

At the same time, it is important to note that the Trump Administration was able to persuade the Chinese government to prohibit fentanyl analogues as well.

However, the DEA’s order expires on February 6, 2020, and, unless Congress acts, many fentanyl analogues will become legal.  Congress’s inaction will deliver a serious blow to our efforts to prosecute drug organizations and dealers who traffic in fentanyl. Further, it will make it more difficult to put behind bars those responsible for the deaths of our loved ones.

The United States Senate recently approved a temporary extension of the DEA’s temporary order.  That is a good start.  But, in order to stem this deadly epidemic, we need Congress to act decisively and permanently declare all fentanyl analogues illegal.  Congress’ action will permanently arm law enforcement with the tools necessary to protect our communities from these deadly illicit drugs. 

Critics of a permanent ban argue that the bill does not include a public health approach to the overdose crisis.  We wholeheartedly agree that only a comprehensive approach will stem the tide of this public health crisis.  Indeed, each of our U.S. Attorney’s offices collaborates with health care professionals, social services providers, and a wide range of community groups to implement comprehensive solutions to address this problem.  But, strong criminal laws are a critical component of the Nation’s response to this crisis, and time is short.  Mexican and Chinese drug traffickers eagerly await the expiration of the DEA’s temporary order to flood our communities with their increasingly deadly analogue poisons. 

We join U.S. Attorney General William Barr and our fellow United States Attorneys across the country in calling upon Congress to permanently ban all fentanyl-related drugs.  The lives of countless Carolinians depend upon swift and decisive action.

Messrs. Higdon, Martin and Murray are the United States Attorneys for the Eastern, Middle and Western Districts of North Carolina, respectively.  Mr. Crick is the Acting United States Attorney for the District of South Carolina.

CHARLOTTE, N.C. – Cynthia Williams-Singleton, 42, of Charlotte, was sentenced today to 27 months in prison and two years of supervised release for stealing more than $458,000 from the accounts of retirees, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. In addition to the prison term imposed, U.S. District Judge Robert J. Conrad Jr. also ordered Williams-Singleton to pay $462,265.40 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.

According to filed court documents and today’s sentencing hearing, from December 2016 to June 2018, Williams-Singleton was a customer service representative with a call center located in Charlotte, for a company identified in court documents as “Company 1.” As a call center representative, Williams-Singleton worked on accounts associated with “Client A,” and had access to Company 1’s data systems that contained, among other things, retirement fund records for Client A’s benefit plan participants and their beneficiaries, including the participants’ personally identifiable information (PII). 

According to court documents, Williams-Singleton carried out the fraud by accessing a participant’s account when the participant contacted the call center. After speaking with the participant and discovering that the participant was unsure or unaware of his or her account balance, Williams-Singleton informed the participant that the participant’s account was either empty, or had less funds than it did. She then added herself, her relatives and others, as beneficiaries of that participant’s account.  Using her access to customers’ PII and retirement fund records, Williams-Singleton made unauthorized transfers of funds from Client A’s plan participants’ retirement accounts into bank accounts in her own name or under her control. During the course of the scheme, Williams-Singleton fraudulently withdrew approximately $458,772.88 in participant and beneficiary funds from approximately eight participant accounts without authorization. Generally, the holders of the participant accounts victimized by Williams-Singleton were persons over the age of 70.

Williams-Singleton pleaded guilty to wire fraud in June 2019. She will be ordered to report to the federal Bureau of Prisons to begin serving her sentence upon designation of a federal facility.  All federal sentences are served without the possibility of parole.

The investigation was handled by the U.S. Secret Service. Assistant U.S. Attorney Jenny Sugar, with 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

Four North Carolina members of the United Blood Nation (UBN or Bloods) street gang were sentenced in Charlotte, North Carolina, after pleading guilty to federal Racketeer Influenced and Corrupt Organizations (RICO) conspiracy charges, announced Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and U.S. Attorney R. Andrew Murray of the Western District of North Carolina.

Tyquan Ramont Powell, aka Savage, 24, of Charlotte, North Carolina, Lamonte Kentrell Lloyd, aka Murda Mo and Moo, 26, of Scotland Neck, North Carolina, Thomas Oliver, aka T.O., Recon, Rex, and Mr. Trippbadd, 34 of Gastonia, North Carolina were each sentenced by Chief U.S. District Court Judge Frank D. Whitney to serve 35 years in prison followed by 3 years of supervised release.  Each of these defendants pleaded guilty to RICO conspiracy charges involving murder.  Judge Whitney also sentenced Marquel Michael Cunningham, aka Mayhem, 23, of Kings Mountain, North Carolina, to 15 years in prison followed by 3 years of supervised release following his guilty plea to RICO conspiracy and his role in an attempted murder.

According to court documents and evidence presented at May 2018 and October 2019 trials of co-defendants, the UBN is a violent criminal street gang operating throughout the east coast of the United States since it was founded as a prison gang in 1993.  UBN members are often identified by their use of the color red, and can also often be identified by common tattoos or burn marks.  The UBN has a militaristic structure, with positions of Godfather, High, Low, Five-Star to One‑Star Generals and soldiers.  UBN members use distinct hand signs and written codes, which are used to identify other members and rival gang members, as well as to try to thwart law enforcement efforts against them.

Members of the UBN are expected to conduct themselves and their illegal activity according to rules and regulations set by their leaders.  Prominent among these is a requirement to pay monthly dues to the organization, often in the amounts of $31 or $93.  UBN gang dues are derived from illegal activity performed by subordinate UBN members including narcotics trafficking, robberies and wire fraud, among other forms of illegal racketeering activity.

According to court documents, Powell and Lloyd were members of the UBN and together committed two murders and three attempted murders in January and February of 2016.  Powell and Lloyd committed the first murder in Scotland Neck, North Carolina, by shooting into a car with three occupants because they believed one of the occupants was cooperating with law enforcement and intended to testify in a criminal case against a close associate of the defendants.  Bullets struck all three occupants and the intended target of the shooting was killed.  The defendants then fled to, among other places, Charlotte, North Carolina, where they received refuge and resources from UBN members and associates while attempting to evade arrest. 

Powell and Lloyd also committed murder in Gastonia, North Carolina, while attempting to rob four victims using handguns.  When the victims resisted the defendants’ robbery attempt, Powell fired his gun and killed one of the victims, who was attempting to flee to safety.  Powell and Lloyd also attempted to rob another victim in Charlotte, North Carolina.  Lloyd shot the victim in the back of the head, but the victim was effectively treated for his injuries at the hospital and lived.

According to court documents and evidence presented at an October 2019 trial of a co-defendant, Oliver drove himself and four other UBN members from Cleveland County, North Carolina, to Chapel Hill, North Carolina, in order to rob an 18-year-old victim of marijuana and money.  Oliver coordinated the crimes as a local UBN leader, and was present when his fellow gang members shot and killed the robbery victim and attempted to kill the victim’s friend, who survived a gunshot wound to his arm.

Also according to court documents, Cunningham committed an armed robbery for the UBN, as well as an assault of a fellow UBN member for violating UBN gang rules.  Court documents and evidence presented at sentencing also showed that Cunningham was present in a car with UBN co‑conspirators in November 2014 when they saw a man who Cunningham believed to be a member of the rival gang called the Crips.  Cunningham pointed the man out to his fellow Bloods and flashed UBN gang hand signs.  Occupants of the car then opened fire on the victim, exited the car, and chased the victim while shooting approximately a dozen times.  No one was injured in the attempted murder.

In May 2017, 83 UBN gang members were indicted in the Western District of North Carolina for RICO conspiracy and other crimes.  In all, 82 defendants have been adjudicated guilty from the investigation.  A jury convicted three top leaders of the UBN of racketeering conspiracy in May 2018, one defendant was convicted of racketeering conspiracy and wire fraud conspiracy at a bench trial in July 2019, and a jury convicted four defendants of racketeering conspiracy and other charges in October 2019.

The investigation was conducted by the FBI’s Charlotte Field Office; the Charlotte Mecklenburg Police Department; the Shelby Police Department; the Cleveland County Sheriff’s Office; the Gastonia Police Department; the North Carolina State Highway Patrol; the Mecklenburg County Sheriff’s Office; the North Carolina Department of Public Safety Adult Corrections and Juvenile Justice; North Carolina Department of Motor Vehicles; Scotland Neck Police Department; the North Carolina State Bureau of Investigation; the Halifax County Sheriff’s Office; the U.S. Federal Probation; the U.S. Bureau of Alcohol, Tobacco, Firearms, and Explosives; the IRS Criminal Investigation; the U.S. Postal Inspection Service; the U.S. Army Criminal Investigation Command; and the New York Department of Corrections and Community Supervision, Office of Special Investigations.  Trial Attorney Beth Lipman of the Criminal Division’s Organized Crime and Gang Section and Assistant U.S. Attorneys Matt Warren and Christopher Hess for the Western District of North Carolina are prosecuting the case.

This prosecution is part of an extensive investigation by the Organized Crime Drug Enforcement Task Forces (OCDETF) Program.  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 level drug trafficking organizations, and coordinating the necessary law enforcement entities and resources to disrupt or dismantle the targeted criminal organization and seize their assets.

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.

Two men were sentenced to prison for their roles in a multimillion-dollar investment fraud scheme targeting the elderly and other vulnerable victims. 

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney R. Andrew Murray of the Western District of North Carolina and Inspector in Charge David McGinnis of the U.S. Postal Inspection Service’s Charlotte Division made the announcement.

Robert Leslie Stencil, 62, of Charlotte, North Carolina, and Michael Allen Duke, 51, of Richardson, Texas, were each sentenced by U.S. District Judge Max O. Cogburn Jr. of the Western District of North Carolina.  Stencil was sentenced to 135 months in prison, and was also ordered to pay $2,745,239 in restitution and to forfeit $868,317.58.  Duke was sentenced to 70 months in prison, and was ordered to pay $1,635,485 in restitution.

Following a three-week trial in January 2019, Stencil and Duke were each found guilty of one count of conspiracy to commit mail and wire fraud.  In addition, Stencil was found guilty of 13 counts of mail fraud, 13 counts of wire fraud and four counts of money laundering.  Duke was found guilty of three counts of mail fraud, one count of wire fraud and one count of money laundering.

According to the evidence presented at trial, from 2012 through 2016, Stencil, Duke and their co-conspirators sold millions of dollars of worthless stock in a sham company named Niyato Industries Inc. (Niyato).  Stencil played the role of Niyato’s chief executive officer.  Duke was Stencil’s top salesperson.  Together with their co-conspirators, Stencil and Duke portrayed Niyato as a leader in its field, manufacturing electric vehicles and converting gasoline vehicles to run on compressed natural gas.  Stencil, Duke and their co-conspirators told victims that Niyato was run by a team of high-profile executives, and that Niyato had patented technology, state-of-the-art facilities and valuable contracts.  They also told victims that Niyato would use 97 percent of the money it raised selling stock to grow its business and expand operations.  Stencil, Duke and their co-conspirators used high-pressure tactics when pitching Niyato stock to victims, the evidence showed.  Among other things, they sold victims on the opportunity to “get in on the ground floor,” offering them a portion of a supposedly limited supply of pre-IPO stock at $.50 per share and promising them a 10- to 16-fold return when Niyato went public.  From 2012 to 2016, Stencil, Duke and their co-conspirators repeatedly told victims that an IPO was imminent, the evidence showed.

In reality, Niyato had no patents, facilities, products or plans to commence an IPO.  Niyato’s true business was the sale of worthless stock.  Stencil, Duke and their co-conspirators used nearly all of the money raised by selling Niyato stock for their own personal benefit, with Stencil paying salespeople – like Duke – half or nearly half of the money they solicited from each investor on behalf of Niyato.  Moreover, Stencil used Niyato’s bank account as his own personal piggybank, the evidence showed. 

The evidence showed that, together, Stencil, Duke and their co-conspirators sold approximately $2.8 million in stock to approximately 140 victims, many of whom were elderly or vulnerable for other reasons.   

Five other defendants have pleaded guilty in this matter and have already been sentenced, namely Nicholas Fleming, 64, of Northridge, California; Martin Delaine Lewis, 53, of Frisco, Texas; Paula Saccomanno, 62, of Boca Raton, Florida; Kristian F. Sierp, 48, of Costa Rica; and Dennis Swerdlen, 65, of Boca Raton, Florida.  Daniel Thomas Broyles Sr., 62, of Beverly Hills, California, was also charged and remains a fugitive.  All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.   

This case was investigated by the U.S. Postal Inspection Service.  Trial Attorney Christopher Fenton of the Criminal Division’s Fraud Section is prosecuting the case. 

The Criminal Division’s Fraud Section plays a pivotal role in the Department of Justice’s fight against white collar crime around the country.

Individuals who believe that they may be a victim in this case should visit the Fraud Section’s Victim Witness website for more information.

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.

Three individuals were sentenced to prison for their roles in an $11 million telemarketing scheme that defrauded primarily elderly victims in the United States from call centers in Costa Rica.

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney R. Andrew Murray of the Western District of North Carolina, Inspector in Charge David M. McGinnis of the U.S. Postal Inspection Service’s Charlotte Division, Special Agent in Charge Bryant Jackson of IRS Criminal Investigation’s (CI) Cincinnati Field Office, Special Agent in Charge Matthew D. Line of IRS-CI’s Charlotte Field Office and Special Agent in Charge John Strong of the FBI’s Charlotte Field Office made the announcement.

Donald Dodt, 76, originally of Cleveland, Ohio, Thomas Sniffen, 58, originally of Peekskill, New York, and Michael Saxon, 50, originally of Ontario, Canada, were sentenced by U.S. District Judge Max O. Cogburn Jr. of the Western District of North Carolina to 90 months, 114 months and 75 months in prison, respectively.  Judge Cogburn also ordered restitution in the amount of $7 million for Dodt, $11,236,857.65 for Sniffen and $2,593,574.02 for Saxon to be paid jointly and severally with their co-conspirators.     

Following a five-day trial in May 2019, Dodt was found guilty of one count of conspiracy to commit wire fraud and mail fraud, two counts of mail fraud, eight counts of wire fraud, one count of conspiracy to commit international money laundering and 10 counts of international money laundering.  In April 2019, Sniffen pleaded guilty to all charges in the 31-count indictment charging conspiracy to commit mail and wire fraud, substantive counts of mail fraud and wire fraud, international money laundering and conspiracy to commit international money laundering.  In May 2019, Saxon pleaded guilty pursuant to a plea agreement to one count of conspiracy to commit mail and wire fraud, one count of mail fraud and one count of conspiracy to commit international money laundering. 

According to the evidence presented at both Dodt’s trial and the sentencing hearings, and the factual bases in support of Sniffen’s and Saxon’s guilty pleas, Dodt, Sniffen and Saxon conspired together to commit the fraud and worked in a call center in Costa Rica.  While falsely posing as federal judges, representatives of the District of Columbia Department of Consumer and Regulatory Affairs and other federal agencies, including the U.S. Federal Trade Commission, they contacted victims in the United States — primarily senior citizens — to tell them that that they had supposedly won a substantial “sweepstakes” prize.  After convincing victims that they stood to receive a significant financial reward, the members of the conspiracy told victims that they needed to make a series of up-front cash payments before collecting, purportedly for items like insurance fees, taxes and import fees.  The co-conspirators used a variety of means to conceal their identity, such as Voice over Internet Protocol (VoIP) services provided by Dodt that made it appear as if they were calling from Washington, D.C., and other places in the United States.

At sentencing, it was determined that Dodt, Sniffen, Saxon and their co-conspirators collectively stole more than $11 million in total from victims.

This case was investigated by the U.S. Postal Inspection Service, IRS-CI, the FBI with assistance from the Federal Trade Commission and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, and the U.S. Department of State’s Diplomatic Security Service (DSS).  The case is being prosecuted by Trial Attorneys Jennifer Farer and Philip Trout of the Criminal Division’s Fraud Section.  Former Fraud Section Trial Attorney William Bowne previously prosecuted the case.  The U.S. Attorney’s Office for the Western District of North Carolina provided substantial assistance with this matter. 

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. – Elijah Stevarus Hallman, 30, of Charlotte, was sentenced today to 231 months in prison in connection with the armed robberies of two fast food restaurants, announced U.S. Attorney Andrew Murray.  Hallman was also ordered to serve three years under supervised release after he is released from prison.

John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, and Chief Kerr Putney of the Charlotte-Mecklenburg Police Department, join U.S. Attorney Murray in making today’s announcement.

According to filed court documents, trial evidence, and statements made in court, Elijah Hallman recruited his cousin and co-defendant, Cameron Hallman, to commit the robberies.  Trial evidence established that, over the course of the armed robberies, Cameron Hallman operated as the getaway driver, and Elijah Hallman acted as the gunman. 

According to court records, around 2:00 a.m. on April 11, 2018, the two men drove to a Wendy’s restaurant located at 7900 Arrowridge Blvd in Charlotte, where Cameron Hallman placed a drive-through order while Elijah Hallman concealed himself nearby.  When Cameron Hallman pulled up to the window, Elijah Hallman walked up and stuck a pistol through the drive-through window, pointed it at the cashier, and demanded money.  Cameron Hallman then pulled off as though he was not associated with Elijah Hallman, and a short while later the pair met up across the street. 

Trial evidence established that the Wendy’s robbery was largely unsuccessful, as the cashier threw five dollars at Elijah Hallman and ran away to another part of the restaurant.  As a result, the co-conspirators decided to commit a second armed robbery.  About 30 minutes after the Wendy’s robbery, Elijah and Cameron Hallman stopped at a McDonald’s restaurant located at 4440 S. Tryon Street in Charlotte.  They executed the same plan in the same manner, however, in this robbery, Elijah Hallman ripped out the entire cash drawer and carried it off.  The robbery netted the pair approximately $360.  According to trial evidence, while leaving the McDonald’s parking lot to meet up with Cameron Hallman, Elijah Hallman dropped some loose change from the cash drawer and a cell phone.  At trial, evidence established that the recovered cell phone belonged to Elijah Hallman, who had used it to communicate with Cameron Hallman, and that the cell phone was in the vicinity of the restaurants during both robberies.  

In April 2019, a federal jury convicted Elijah Hallman of Hobbs Act robbery, which is the robbery of a business engaged in interstate commerce; conspiracy to commit robbery; and possession of a firearm in furtherance of the robbery.  Cameron Hallman previously pleaded guilty for his role in the robberies and was sentenced to 180 months in prison and three years of supervised release.

Elijah Hallman is currently in federal custody.  He will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility.  All federal sentences are served without the possibility of parole.

The FBI and CMPD handled the investigation.  Assistant U.S. Attorneys David Kelly and Cortney Randall, of the U.S. Attorney’s Office in Charlotte, prosecuted Elijah Hallman’s case.  Assistant U.S. Attorney Steven Kaufman handled Cameron Hallman’s prosecution.   

CHARLOTTE, N.C. – Hal H. Brown Jr., 70, of Asheville, N.C., pleaded guilty to securities fraud and transactional money laundering in federal court today before U.S. Magistrate Judge David C. Keesler, for orchestrating a $22 million Ponzi scheme, 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, joins U.S. Attorney Murray in making today’s announcement.

According to admission made in plea documents and today’s plea hearing, from at least 2006 through September 2019, Brown fraudulently obtained more than $22 million from dozens of victims, some of whom were at, or near, retirement age, by engaging in an investment scheme through his company Oodles Inc. and its various affiliates (collectively, “OODLES”).  Individual victims invested anywhere from a few thousand to a few million dollars in OODLES. To induce victims to invest their money, Brown falsely represented that OODLES owned hundreds of millions of dollars in intellectual property, namely family entertainment shows and movies. As part of the scheme, Brown repeatedly lied to victims about the imminent sale of those intellectual properties to various well-known media companies. To perpetuate the fraud, Brown developed marketing material seeking investments or loans for OODLES that claimed large returns on funds invested or lent to the company.

As Brown admitted in court today, to convince victims the scheme was legitimate and to appease investors who sought an explanation about delays in payouts, Brown provided victims with a number of fraudulent and misleading statements and fictitious information, including fake bank statements and falsified company agreements, among others.

Brown used a substantial part of victim money on personal expenses unrelated to purported OODLES transactions.  He also used funds contributed by new investors to make payments to existing investors, commonly referred to as “Ponzi” payments.

A sentencing date for Brown has not been set.  The securities fraud charge carries a maximum prison sentence of 20 years and a $5 million fine. The transactional money laundering charge carries a maximum prison term of 10 years and a fine of not more than twice the amount of criminally derived property in the transaction or $250,000.

The FBI’s Charlotte Field Office handled the investigation.

Assistant U.S. Attorneys Daniel Ryan and Mark Odulio of the U.S. Attorney’s Office in Charlotte are prosecuting 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. – Erik Raymond Magana, 34, of Charlotte, was sentenced today to 42 months in prison for stealing thousands of pieces of mail from at least 1,300 victims in North and South Carolina, announced U.S. Attorney Andrew Murray.  Magana was also ordered to serve one year in supervised release, and to pay $77,304 as restitution. Magana pleaded guilty on April 2, 2019, to mail theft and aggravated identity theft.

U.S. Attorney Murray is joined in making today’s announcement by David M. McGinnis, Inspector in Charge of the Charlotte Division of the U.S. Postal Inspection Service, and Chief Kerr Putney of the Charlotte-Mecklenburg Police Department.

According to filed court documents and statements in court, from at least 2016 until November 2018, Magana routinely stole mail from residential mailboxes in neighborhoods in North and South Carolina. Magana typically targeted affluent neighborhoods, and committed the theft in the middle of the night or pre-dawn to avoid detection.  Among the pieces of mail Magana stole were personal and business checks and credit cards, which he used to commit bank fraud and identity theft.

Court records show that Magana dumped some of the stolen mail at various locations in Charlotte, but hoarded the majority of it in his apartment. After cataloguing the mail recovered over the course of the investigation, law enforcement determined that Magana had stolen mail from at least 1,300 victims. According to statements made in court during Magana’s sentencing hearing, this was the largest recovery of stolen mail conducted by USPIS in the Charlotte region in at least 15 years.  Due to the unsanitary conditions in Magana’s apartment, some of the recovered mail could not be properly identified or delivered to the intendent recipients, court records show.

Magana is currently in federal custody.  He will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility.  All federal sentences are served without the possibility of parole.

In making today’s announcement, U.S. Attorney Murray thanked the U.S. Postal Inspection Service in Charlotte, and the Charlotte Mecklenburg Police Department, and noted that the case is the result of the Charlotte Financial Crimes Task Force (CFCTF).  The task force was formed in early 2016 by the U.S. Postal Inspection Service and currently comprises over 25 local, state and federal law enforcement agencies located in the Western District of North Carolina. The goal of the taskforce is to focus on the identification and development of financial fraud investigations in the Charlotte area. Based on crime trends in the area, the task force began to focus its efforts on violent offenders with lengthy criminal histories who are committing fraud. 

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

A Charlotte, North Carolina, tax return preparer pleaded guilty today to aiding and assisting in filing a false tax return, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney R. Andrew Murray of the Western District of North Carolina.

According to court documents and statements made in court, Ramonda Byrd owned and operated Divine Financial Solutions, a Charlotte, North Carolina, tax preparation business with locations on Beatties Ford Road and Central Avenue. From 2012 through 2017, Byrd prepared false tax returns on behalf of her clients. By reporting fictitious business income and expenses as well as false medical expenses, charitable contributions, and child and dependent care expenses, she sought to cause the Internal Revenue Service (IRS) to pay inflated refunds. Byrd’s fee was then often deducted from the client’s refund. In all, Byrd’s conduct caused a tax loss to the United States of more than $270,000.

Sentencing will be scheduled at a later date. At sentencing, Byrd faces a maximum sentence of three years in prison. She also faces a period of supervised release, restitution, and monetary penalties.

Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Murray thanked special agents of IRS – Criminal Investigation, who conducted the investigation, and Trial Attorney Jessica Kraft of the Tax Division and Assistant U.S. Attorney Caryn Finley, who prosecuted the case.

CHARLOTTE, N.C. – Omontie Rowe, 22, of Charlotte, pleaded guilty in federal court to aggravated identity theft, for his role in an extensive check-cashing scheme that caused hundreds of thousands of dollars in losses to at least five financial institutions, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.  U.S. District Judge David S. Cayer presided over today’s plea hearing.  

David M. McGinnis, Inspector in Charge of the Charlotte Division of the U.S. Postal Inspection Service, joins U.S. Attorney Murray in making today’s announcement.

From January 2018 through June 2019, Rowe and his three co-defendants, Jacoby Berry, Fredrick Clark, and Fabio Wolfe, executed the check cashing scheme by obtaining business and personal checks that were stolen, counterfeit or altered by members of the conspiracy.  After depositing the worthless checks into various bank accounts, the co-conspirators made multiple cash withdrawals and purchases before the victim banks detected the fraud.

Court records show that the four defendants called themselves the “All Profit Group,” or “AP Group,” and bragged about their successful check fraud scheme on social media, by posting images of themselves with handfuls of cash.  They also used social media to recruit “straw account holders,” by posting to social media websites and approaching individuals with the promise of an easy pay day.  According to court records, the recruited straw account holders were promised a payment of $100 to $1,500, in exchange for allowing the co-defendants to use the account holders’ new or existing bank accounts to perpetuate the fraud.  

All four co-defendants have pleaded guilty to aggravated identity theft and are awaiting sentencing. The aggravated identity theft charge carries a mandatory minimum prison term of two years. A sentencing date has not been set.

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

Assistant U.S. Attorneys Maria Vento and William Miller, of the U.S. Attorney’s Office in Charlotte, is in charge of the prosecution.

CHARLOTTE, N.C. – U.S. Attorney Andrew Murray announced today that Luis Analberto Pineda-Anchecta, 37, a Honduran national, has been charged with kidnapping via a federal criminal complaint filed in federal court in Charlotte. 

Ronnie Martinez, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) in Charlotte, and Chief Kerr Putney of the Charlotte Mecklenburg Police Department (CMPD), join U.S. Attorney Murray in making today’s announcement.

According to allegations contained in the criminal complaint, on or about May 15, 2019, CMPD officers arrested Pineda-Anchecta on several state charges, including Assault on a Female and Communicating Threats against his ex-girlfriend, identified in court documents as F.M. Two days following his arrest, the complaint alleges that Pineda-Anchecta was released from state custody on bond.

As alleged in the criminal complaint, in the evening of May 21, 2019, F.M. was approached by two masked men as she was walking to her vehicle parked at her apartment complex in Charlotte.  The victim recognized one of the masked men as the defendant, who allegedly proceeded to grab the victim by the arm, stuff a cloth in her mouth, and then wrap a cord or rope around her head so the cloth would stay in place.  The complaint alleges that Pineda-Anchecta and the other masked man then forced F.M. against her will into the passenger seat of a vehicle. As alleged in the complaint, Pineda-Anchecta then told F.M. “I love you and I’m going to kill you.” The complaint alleges that the other masked individual did not accompany Pineda-Anchecta and F.M. in the vehicle.  

According to allegations in the criminal complaint, Pineda-Anchecta drove his vehicle on Lancaster Highway. While Pineda-Anchecta was driving, the complaint alleges that he maintained a tight grip on the plastic rope tied around the victim’s face.  According to the complaint, after traveling a short while on Lancaster Highway, Pineda-Anchecta parked his vehicle on the side of the road near a wooden area and turned off the vehicle’s engine.  Pineda-Anchecta maintained his grip on the plastic rope around F.M.’s face, and allegedly pulled the victim out of the car and dragged her toward the wooded area near the road. 

The complaint alleges that, following a struggle between Pineda-Anchecta and F.M., the victim was able to escape and run into the middle of the highway, and was assisted by motorists who stopped to offer help.  According to allegations in the complaint, the victim identified Pineda-Anchecta as the person who had assaulted her.  

The complaint further alleges that Pineda-Anchecta left the scene on foot. After obtaining a search warrant, CMPD officers searched Pineda-Anchecta’s vehicle, from which they recovered a spool of plastic rope similar to the rope wrapped around the victim’s face during the course of the kidnapping. Law enforcement also located the victim’s phone in Pineda-Anchecta’s vehicle.

Pineda-Anchecta is currently in federal custody.  He was previously convicted of illegal reentry by a deported alien, and, on January 7, 2020, he was sentenced to seven months in prison.  Pineda-Anchecta will appear in federal court on the new federal charges on Friday, January 10, 2020. The kidnapping charge carries a maximum term of life in prison.

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

In making today’s announcement U.S. Attorney Murray commended ICE’s Homeland Security Investigations and CMPD for their investigation of this case. He also thanked ICE’s Enforcement and Removal Operations for their assistance.

Assistant U.S. Attorney Kenneth Smith is in charge of the prosecution.

CHARLOTTE, N.C. – Kamlesh Gopal Pardasani, 49, of Waxhaw, N.C., appeared in court this morning in Charlotte, on federal charges related to an $800,000 investment scheme he allegedly orchestrated, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.  The federal indictment was filed on June 19, 2018, in the Western District of North Carolina, and was unsealed on November 30, 2019, after Pardasani was arrested at the Philadelphia International Airport upon entering the United States from India.

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

According to allegations contained in the indictment, from August 2016 to June 2017, Pardasani executed a scheme to defraud at least five victims of more than $800,000, by inducing the victims to invest in his company, FreightGuru.com LLC (FreightGuru).  As alleged in the indictment, to induce his victims to invest their money, Pardasani falsely represented that he would use the investors’ money to fund a specific shipment of goods, and that, once the shipment cleared, the victims’ return rate on their initial investment would be between 15% and 20%.  Pardasani also lied to victims by falsely assuring them that their funds were secure and safe, when in fact he used the victims’ money to fund his lifestyle, pay off personal creditors, and to engage in high-risk securities trading in his personal trading account.  The indictment also alleges that after failing to invest the victims’ funds as promised, Pardasani continued to make additional false and fraudulent representations to lull victims and provide excuses for failing to return the victims’ money. 

Pardasani is charged with wire fraud, which carries a maximum prison term of 20 years and a $250,000 fine, and money laundering, which carries a maximum prison term of 10 years and a fine of not more than twice the amount of criminally derived property in the transaction or $250,000.

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

The FBI’s Charlotte Field Office led the investigation. Assistant U.S. Attorney Caryn Finley of the U.S. Attorney’s Office in Charlotte is prosecuting the case.

STATESVILLE, N.C. – U.S. Attorney Andrew Murray announced today that Keyon Shaqual Miller, 29, of Statesville, was sentenced to 15 years in prison on drug charges.  In addition to the prison term imposed, Miller was ordered to serve three years under court supervision upon completion of his prison term. 

Court records show that, from at least November 2018 to December 2018, Miller was trafficking narcotics in Statesville and surrounding areas. According to statements made in court and in filed court documents, over the course of the investigation, Miller sold crack cocaine and firearms – including two SKS type rifles – to an individual working with law enforcement.  On October 7, 2019, Miller pleaded guilty to distribution and possession with intent to distribute crack cocaine.  At today’s hearing, Miller’s sentence was enhanced because of his prior felony convictions, which include Common Law Robbery and Robbery with a Dangerous Weapon, which classified Miller as a career offender under the United States Sentencing Guidelines.

Miller is currently in custody.  He will be ordered to report to the federal Bureau of Prisons to begin serving his sentence, upon designation of a federal facility. All federal sentences are served without the possibility of parole.

In making today’s announcement, U.S. Attorney Murray thanked the Bureau of Alcohol, Tobacco, Firearms & Explosives, the North Carolina State Bureau of Investigation, the Statesville Police Department, and the Iredell County Sheriff’s Office for their investigation of this case.

U.S. Attorney Murray also thanked Sarah M. Kirkman, District Attorney for Iredell County, for her office’s assistance in this case.

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

STATESVILLE, N.C. – U.S. District Judge Kenneth D. Bell handed down prison terms today to two Statesville-area men for the theft of four firearms, announced Andrew Murray, U.S. Attorney for the Western district of North Carolina.

Niseem Booquan Clay, 19, was sentenced to 57 months in prison, followed by three years of supervised release. Clay pleaded guilty on September 26, 2019, to conspiracy to steal or carry away any firearm from a Federal Firearms Licensee and steal or carry away any firearm from a Federal Firearms Licensee.  Devin Quamaine Templeton, 23, was ordered to serve 48 months in prison and two years of supervised release.  Templeton pleaded guilty on September 17, 2019, to possession of a firearm by a felon.

According to admissions made in court in connection with their guilty pleas and information introduced today at their sentencing hearing, on September 19, 2018, in the early morning hours, Clay and Templeton broke into Mr. G’s Pawn & Trade, a business located in Taylorsville, N.C. The defendants stole four firearms from the pawn shop, and drove away in a stolen SUV vehicle. Five days later, on September 24, 2018, witnesses called 911 to report that an attempted armed robbery was taking place at a closed gas station in Haywood County.  A short time later, law enforcement in Buncombe County initiated a traffic stop of the same stolen SUV vehicle. Templeton was the driver of the vehicle, and Clay was a passenger in the back seat. Over the course of the traffic stop, law enforcement recovered three of the four stolen firearms, and 52 rounds of ammunition.

Clay and Templeton are currently in custody.  They will be ordered to report to the federal Bureau of Prisons to begin serving their sentence, upon designation of a federal facility. All federal sentences are served without the possibility of parole.

In making today’s announcement, U.S. Attorney Murray thanked the Bureau of Alcohol, Tobacco, Firearms & Explosives, the North Carolina State Bureau of Investigation, the Taylorsville Police Department, the Haywood County Sheriff’s Office, and the Buncombe County Sheriff’s Office for their investigation of this case.

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

CHARLOTTE, N.C. – Jolynn Denise McHone, 45, of Fort Mill, South Carolina, was sentenced late yesterday to three years in prison and two years of supervised release for embezzling more than $2.4 million worth of computer equipment from her employer, announced Andrew Murray, U.S. Attorney for the Western district of North Carolina. U.S. District Judge Robert J. Conrad Jr. also ordered McHone to pay more than $2.4 million in restitution.

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

According to the filed court documents, from 2006 to 2017, McHone was employed by a Florida-based company as an information technology (IT) procurement manager.  In that capacity, McHone was responsible for negotiating IT equipment purchases and lease agreements with the company’s IT vendors, managing IT equipment and purchases for the company and its subsidiaries throughout the United States, including North Carolina, and managing the company’s IT operating budget. 

Court records show that from 2012 to 2017, McHone defrauded her employer by using company funds to order new IT equipment for supposedly legitimate company business, which she had delivered to a company subsidiary located in Concord, North Carolina. McHone intercepted the deliveries of the equipment, then met a co-conspirator in Charlotte, to whom she sold the equipment for cash, often for as little as 60 percent of the retail value of the equipment.  During the relevant time period, McHone admitted that she engaged in dozens of fraudulent IT equipment purchase or lease transactions.  Through this scheme, McHone obtained hundreds of fraudulently-acquired pieces of equipment, and caused losses of more than $2.4 million to the company.

On April 4, 2019, McHone pleaded guilty to wire fraud. McHone will be ordered to report to the federal Bureau of Prisons to begin serving her sentence, upon designation of a federal facility. All federal sentences are served without the possibility of parole.

The FBI investigated the case. Assistant U.S. Attorney William Bozin, of the U.S. Attorney’s Office in Charlotte, handled the prosecution.  

 CHARLOTTE, N.C. – Gino Aristoteles Costa, 43, of Matthews, N.C. was sentenced late yesterday to 121 months in prison for transportation of child pornography, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.  Chief U.S. District Judge Frank D. Whitney also ordered Costa 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 Charlotte joins U.S. Attorney Murray in making today’s announcement.

According to court documents and information introduced at the sentencing hearing, in November 2017, Costa was using a peer-to-peer network to access and transport multiple files containing child pornography.  HSI agents were able to successfully download multiple files of child pornography from Costa during this time period. During a subsequent search of Costa’s residence, law enforcement seized Costa’s computer.  Costa admitted he downloaded child pornography videos for several months, some depicting the sexual abuse of children as young as toddlers. 

Costa pleaded guilty on July 8, 2019, to transportation of child pornography. 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.  All federal sentences are served without the possibility of parole.  

In making today’s announcement, U.S. Attorney Murray thanked HSI for conducting the investigation.  Assistant U.S. Attorney Alfredo De La Rosa of the U.S. Attorney’s Office in Charlotte prosecuted the case.

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. – U.S. District Judge Martin Reidinger sentenced Alejandro Javier Chaves, 44, of Douglasville, Georgia, to 360 months in prison, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.  Judge Reidinger also ordered Chaves to serve five years under court supervision after he is released from prison.

Joining U.S. Attorney Murray in making today’s announcement are Robert J. Murphy, Special Agent in Charge of the Atlanta Field Division of the Drug Enforcement Administration (DEA), which oversees the Asheville District Office; Gregory Forest, United States Marshal for the Western District of North Carolina; Director Robert Schurmeier of the North Carolina State Bureau of Investigation; Sheriff Chip Hall of the Jackson County Sheriff’s Office; Sheriff Robert Holland of the Macon County Sheriff’s Office; and Sheriff Quentin Miller of the Buncombe County Sheriff’s Office.

According to filed court documents and today’s sentencing hearing, in 2017, Chaves was serving a sentence in the Georgia Department of Corrections related to nine felony convictions, including convictions for trafficking methamphetamine and threatening to kill a member of law enforcement.  Between January and February 2017, while incarcerated in Georgia, Chaves used a contraband cell phone to orchestrate multi-ounce methamphetamine deals with a narcotics trafficker located in the Western District of North Carolina.  Following an investigation into that criminal activity, Chaves was indicted in October 2017 by a grand jury in Asheville, and was transferred to the Western District of North Carolina to face the federal charges.

In May 2018, Chaves pleaded guilty to possession with intent to distribute methamphetamine.  Court records show that, while he was in federal custody at the Buncombe County Detention Center, Chaves used a phone within the detention center to orchestrate additional methamphetamine deals, accounting for another four and half kilograms of methamphetamine.  According to court records, Chaves arranged the drug deals between the date he entered his guilty plea and the date of his sentencing hearing.

Chaves remains in custody. Upon designation of a federal facility he will be transferred to the custody of the federal Bureau of Prisons. All federal sentences are served without the possibility of parole. 

The DEA in Asheville conducted the investigation.  The U.S. Marshals Service, the SBI, the Jackson County Sheriff’s Office, the Macon County Sheriff’s Office, and the Buncombe County Sheriff’s office also assisted with the case.

Assistant U.S. Attorney Thomas Kent of the U.S. Attorney’s Office in Asheville prosecuted the case.           

CHARLOTTE, N.C. – Michael Edwin Dorcas, 56, of Huntersville, N.C., was sentenced today to 120 months in prison for enticement of a minor, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.  In addition to the prison term imposed, U.S. District Judge Robert J. Conrad Jr. also ordered Dorcas to serve 30 years of supervised release and to register as a sex offender.

According to court documents and today’s court proceedings, on January 29, 2016, Dorcas befriended a 12-year-old female online and began chatting with her. Over the course of their communication, Dorcas – who knew the victim was 12 years old– suggested they communicate via video chat. Dorcas led the minor to believe that he was a 15-year-old male, and convinced the minor to use her web cam, which allowed him to see her.  Dorcas lied to the minor, telling her that his video cam was not working, and instead sent her pictures of a teenage male claiming it was him. Court records show that during their exchange, Dorcas convinced the minor to expose herself by removing articles of clothing.

On April 7, 2016, agents with the North Carolina State Bureau of Investigation (SBI) executed a search warrant at Dorcas’ residence, and seized electronic devices.  A forensic examination of the devices revealed that, in addition to the 12-year-old victim, Dorcas had chatted with other minors as well.

Dorcas pleaded guilty on February 28, 2019, to enticement of a minor. He will be ordered to report to the Federal Bureau of Prisons to begin serving his sentence upon designation of a federal facility.  Federal sentences are served without the possibility of parole.

In making today’s announcement, U.S. Attorney Murray commended the SBI for their investigation of this case and thanked Homeland Security Investigations for the assistance. 

Assistant United States Attorney Cortney Randall, with 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 the U.S. Attorney’s Office 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.

CHARLOTTE, N.C. – U.S. Attorney Andrew Murray announced today that four defendants were sentenced to prison for firearms violations.  The defendants were prosecuted as part of Project Guardian, the Justice Department’s signature initiative to reduce gun violence and enforce gun laws.

U.S. v. Elroy Marshall

Chief U.S. District Judge Frank D. Whitney sentenced today Elroy Lee Marshall, 39, of Hamlet, N.C., to 105 months in prison, followed by three years of supervised release. According to court records, on October 15, 2017, Marshall possessed a Ruger Model LC9, 9mm pistol, which he carried in his pocket.  Marshall has a prior federal conviction for his involvement in an armed postal robbery, and he is prohibited from possessing a firearm.

The Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF) investigated the case.  Assistant U.S. Attorneys Robert Gleason and Anthony Enright, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.

U.S. v. Zacharias Lee

Yesterday, U.S. District Judge Robert J. Conrad Jr. sentenced Zacharias Lee, 27, of Charlotte, to 70 months in prison, followed by two years of supervised release. According to court documents, on March 26, 2018, Charlotte Mecklenburg police officers responded to a suspicious vehicle call. Upon locating the vehicle, the officers observed Lee, who was the driver of the vehicle, trying to hide a firearm under the vehicle while he was talking to the officers.  A second firearm was recovered from the backseat of the vehicle. Upon further investigation, law enforcement determined that Lee had stolen a total of four firearms, by breaking into parked vehicles belonging to firefighters, at three fire departments in Mecklenburg County. Lee has two other prior state convictions for Possession of a Firearm by a Felon, and is prohibited from possessing a firearm. Court records show that Lee was on probation for his second Possession of a Firearm by a Felon conviction when he broke into the vehicles and stole the firearms.

The case was investigated by ATF and the Charlotte-Mecklenburg Police Department (CMPD).  Assistant U.S. Attorney Cortney Randall, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.

U.S. v. Santario Boyd

Judge Conrad also sentenced yesterday Santario Boyd, 29, of Charlotte, to 68 months in prison, followed by two years of supervised release.  According to court documents in this case, on January 31, 2018, Boyd shot a victim in the leg in response to something the victim said to Boyd.  On February 21, 2018, CMPD’s Violent Criminal Apprehension Team arrested Boyd for the shooting, and a firearm was located in the bedroom where Boyd was found.  Over the course of the investigation, law enforcement determined that the recovered firearm was the same one Boyd used to shoot the victim. On January 31, 2019, Boyd pleaded guilty to possession of a firearm by a felon. 

ATF and CMPD handled the investigation, and Assistant U.S. Attorney David Kelly was in charge of the prosecution for the United States.

U.S. v. Marcus Watkins

Yesterday, Judge Conrad sentenced Marcus Bernard Watkins, 29, of Charlotte, to 68 months in prison and three years of supervised release. According to court documents, on August 30, 2017, probation officers with the North Carolina Department of Public Safety (NCDPS) and CMPD officers conducted a warrantless search and compliance check at Watkins’ residence, who at the time was under state supervision. Over the course of the search, law enforcement located a loaded .40 caliber semi-automatic pistol in Watkins’ bedroom.  Due to his prior conviction, Watkins was prohibited from possessing a firearm.

ATF, NCDPS and CMPD handled the investigation. Assistant U.S. Attorney Christopher Hess, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.

* * *

In making today’s announcement, U.S. Attorney Murray thanked the law enforcement agencies involved in the aforementioned prosecutions, and noted that these cases are part of Project Guardian, the Department of Justice’s signature initiative to reduce gun violence and enforce federal firearms laws. 

Initiated by Attorney General William P. Barr, Project Guardian draws upon the Department’s past successful programs to reduce gun violence; enhances coordination of federal, state, local, and tribal authorities in investigating and prosecuting gun crimes; improves information-sharing by the ATF when a prohibited individual attempts to purchase a firearm and is denied by the National Instant Criminal Background Check System (NICS), to include taking appropriate actions when a prospective purchaser is denied by the NICS for mental health reasons; and ensures that federal resources are directed at the criminals posing the greatest threat to our communities. 

STATESVILLE, N.C. – A federal jury in Statesville has convicted Thomas Arthur Rittenhouse, 75, of Boone, N.C. of transporting and possessing child pornography, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. U.S. District Judge Kenneth D. Bell Sr. presided over the trial.

“Protecting the most vulnerable amongst us, our children, remains a top priority of my Office,” said U.S. Attorney Murray. “This defendant sought out, possessed, and transported images of the rape and abuse of children for his sordid personal use. Along with our law enforcement partners, my Office will ensure that this defendant, and anyone else engaged in similar horrific conduct, are brought to justice.”

According to filed court documents and evidence presented at trial, between 2014 and 2017, Rittenhouse used peer-to-peer computer networks to obtain dozens of videos depicting children being sexually abused.  Rittenhouse then made child abuse videos available for download by other users of the peer-to-peer network. Evidence at trial showed that the computer Rittenhouse used to transport and possess child pornography reflected that Rittenhouse had used search terms associated with child abuse material to seek out such videos and images. A forensic analysis of video files seized from Rittenhouse’s computer showed adult men sexually abusing prepubescent children.

Rittenhouse was convicted of two counts of transporting child pornography, which carries a minimum term of five years and a maximum term of 20 years in prison per count, and a $250,000 fine. He was also convicted of one count of possessing child pornography depicting a prepubescent minor or a minor under the age of twelve, which carries a maximum prison term of 20 years and a fine of up to $250,000.

In making today’s announcement U.S. Attorney Murray thanked the Boone Police Department and the North Carolina State Bureau of Investigation for their investigation of this case, and Homeland Security Investigations and the Federal Bureau of Investigation for their assistance. 

Assistant United States Attorneys Alfredo DeLaRosa and Taylor J. Phillips prosecuted the case for the United States.

CHARLOTTE, N.C. – The U.S. Attorney’s Office for the Western District of North Carolina announced that it has settled claims with Manoj Kumar, a former sales representative and manager for Physician’s Choice Laboratory Services (PCLS), a defunct urine drug testing laboratory that was based in Charlotte, N.C.

Kumar has paid $649,407 to resolve claims that he participated in schemes to illegally induce physicians to send medically unnecessary urine drug tests to PCLS.  Kumar was a defendant in a civil complaint filed by the United States against Kumar, PCLS and other agents of the company. 

The United States alleged that Kumar, along with other agents of PCLS, provided benefits to physicians to induce them to send urine samples to PCLS for drug testing that was not medically necessary.  The complaint alleges that Kumar’s actions violated the Anti-Kickback Statute, which makes it illegal for any person to knowingly and willfully solicit or receive, or offer or pay any remuneration in exchange for the referral of items or services that are paid for by a federal health care program.  The United States alleged that PCLS then submitted claims to Medicare for these tests in violation of the False Claims Act. 

“Tests and other services should be ordered by physicians based on sound medical judgment, not on financial benefit,” said Andrew Murray, United States Attorney for the Western District of North Carolina.  “Paying inducements to obtain orders for tests and other services corrupts medical decision-making and causes unnecessary costs to federal healthcare programs.” 

The United States alleged that Kumar received payments from PCLS to channel urine drug tests to PCLS from physician practices that he managed.  The United States further alleged that Kumar, along with a co-defendant in the case, provided equipment and related services to physicians in exchange for those physicians sending urine drug samples to PCLS. 

“The Ant-Kickback Statute is meant to protect patients and federal health programs from medical decision-making corrupted by financial motive,” said U.S. Attorney Murray.  “My office will aggressively pursue such claims.” 

The United States Complaint in Intervention was filed in the qui tam case United States ex rel. Hartnett & Shoched v. Physicians Laboratory Services, LLC et al. (Civil Case No. 17-cv-37) which was consolidated with the qui tam case United States ex rel. Jenkins et al. v. Physician’s Choice Laboratory Services et al. (Civil Case No. 17-cv-46).  The two qui tam cases were originally filed in the Middle District of Florida and the Eastern District of Tennessee, respectively, but transferred to the Western District of North Carolina in January, 2017.  Additional defendants remain in the case which is currently in litigation.  The Settlement Agreement is not an admission of liability or wrongdoing by Kumar.   

CHARLOTTE, N.C. – U.S. Attorney Andrew Murray announced today that Travis Justin Stout, 35, of Hickory, N.C., appeared before U.S. Magistrate Judge David S. Cayer and pleaded guilty to drug trafficking conspiracy and possession with intent to distribute narcotics on the Dark Web.

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

According to information contained in filed court documents and today’s plea 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 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 was arrested after he received a dark web drug delivery.  Law enforcement seized his computer and recovered cryptocurrency drug proceeds associated with these crimes, which Stout has agreed to forfeit to the U.S. Government.

The drug trafficking conspiracy charge carries a maximum term of 20 years in prison, and a $1,000,000 fine.  The possession with intent to distribute charge also carries a maximum prison term of 20 years in prison and a $1,000,000 fine.  A sentencing date for Stout has not been set.

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 are in charge of the prosecution.

CHARLOTTE, N.C. – The Justice Department’s Office of Justice Programs today announced awards of more than $333 million to help communities affected by the opioid crisis, of which more than $3.5 million will help public safety and public health professionals in the Western District of North Carolina to combat substance abuse and respond effectively to overdoses. OJP Principal Deputy Assistant Attorney General Katharine T. Sullivan and U.S. Attorney Andrew Murray made the announcement.

“The opioid crisis has destroyed far too many lives and left too many Americans feeling helpless and hopeless,” said PDAAG Sullivan. “This epidemic—the most deadly in our nation’s history—is introducing new dangers and loading public health responsibilities onto the public safety duties of our law enforcement officers. The Department of Justice is here to support them during this unprecedented and extremely challenging time.”

With more than 130 people dying from opioid-related overdoses every day, the Department of Justice has made fighting addiction to opioids—including heroin and fentanyl—a national priority. The Trump Administration is providing critical funding for a wide range of activities—from preventive services and comprehensive treatment to recovery assistance, forensic science services and research—to help save lives and break the cycle of addiction and crime.

“Opioid abuse and addiction are rampant nationwide, and unfortunately, Western North Carolina is not immune from this national epidemic. Federal funding provided by the Justice Department to counties in this district will go a long way toward providing much-needed services to the communities hardest hit by the widespread abuse of opioids,” said U.S. Attorney Murray. 

The awards announced today support an array of activities designed to reduce the harm inflicted by these dangerous drugs. Grants will help law enforcement officers, emergency responders and treatment professionals coordinate their response to overdoses. Funds will also provide services for children and youth affected by the crisis and will support the nationwide network of drug and treatment courts. Other awards will address prescription drug abuse, expand the capacity of forensic labs and support opioid-related research.

The following awards, totaling $3,555,478, were made to agencies and counties in the Western District of North Carolina, to support comprehensive abuse site-based programs, and/or adult drug court and treatment court for veterans.

• Buncombe County Health and Human Services - $878,803.
• Rutherford County - $600,000.
• Burke County - $600,000.
• Appalachian District Health Department - $551,257.
• Catawba County - $500,000.
• Cleveland County Health Department - $425,418

Information about the programs and awards announced today is available here. For more information about OJP awards, visit the OJP Awards Data webpage.

The Office of Justice Programs, directed by Principal Deputy Assistant Attorney General Katharine T. Sullivan, provides federal leadership, grants, training and technical assistance, and other resources to improve the nation’s capacity to prevent and reduce crime, assist victims and enhance the rule of law by strengthening the criminal and juvenile justice systems. More information about OJP and its components can be found at www.ojp.gov.

CHARLOTTE, N.C. –U.S. District Judge Robert J. Conrad Jr. sentenced today April Nicole Pitchford, 31, of Mint Hill, N.C., to 30 years in prison, followed by 30 years of supervised release for producing child pornography, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. Pitchford was also ordered to register as a sex offender after she is released from prison. 

According to filed court documents and today’s sentencing hearing, between October 18 and October 19, 2016, Pitchford sexually abused a four-year-old victim. Court records show that Pitchford created a video depicting sexually explicit conduct with the minor, and sent it via text message to another individual.

On November 27, 2018, Pitchford pleaded guilty to production of child pornography. She is currently in federal custody and will be transferred to the custody of the Federal Bureau of Prisons upon designation of a federal facility.  All federal sentencings are served without the possibility of parole. 

In making today’s announcement, U.S. Attorney Murray thanked ICE’s Homeland Security Investigations, the North Carolina State Bureau of Investigation, the Rowan County Sheriff’s Office, and the Mint Hill Police Department for investigating this case. Assistant U.S. Attorney Cortney Randall of the U.S. Attorney’s Office in Charlotte prosecuted the case.

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.