District of New Jersey

NEWARK, N.J. – A Florida man admitted his role in a conspiracy to receive kickbacks and bribes from laboratories in exchange for referrals of patient DNA samples and genetic tests, Attorney for the United States Vikas Khanna announced today.

Jeffrey Tamulski, 50, of Tampa, Florida, pleaded guilty before U.S. District Judge Brian R. Martinotti in Newark federal court on March 26, 2024, to a superseding information charging him with conspiracy to commit an offense against the United States in connection with a scheme to violate the Anti-Kickback Statute. Tamulski and five co-defendants were previously charged by indictment in September 2019 in connection with the conspiracy and a related health care fraud scheme.

According to documents filed in this case and statements made in court:

On behalf of certain laboratories, Tamulski recruited outside marketing groups, including Ark Laboratory Network LLC, a company owned by Tamulski’s conspirators, to refer patients’ DNA samples to the laboratories for genetic tests. Tamulski and certain conspirators entered into kickback agreements with laboratories under which the laboratories paid Ark bribes in exchange for delivering DNA samples and orders for genetic tests. Ark concealed these kickback arrangements by issuing sham invoices to laboratories that purportedly reflected services provided at an hourly rate even though the parties had already agreed upon the bribe amount, which was based on the revenue the laboratories received from Medicare or an amount paid for each DNA sample. From January 2018 through January 2019, Medicare paid these laboratories approximately $4.6 million for genetic tests that resulted from the referrals and DNA samples that Ark delivered to the laboratories in exchange for bribes. In turn, the laboratories paid Ark at least $1.8 million in bribes.

The charge to which Tamulski pleaded guilty carries a maximum penalty of five years in prison and a fine of $250,000, or twice the gross grain or loss from the offense whichever is greatest. Tamulski’s sentencing is scheduled for Aug. 6, 2024.

Co-defendants Kacey C. Plaisance, of Altamonte Springs, Florida; Kyle D. McLean, of Arlington Heights, Illinois; Edward B. Kostishion, of Lakeland, Florida; and Jeremy Richey, of Mars, Pennsylvania, previously pleaded guilty and all are awaiting sentencing.

Matthew Ellis, of Gainesville, Florida, was charged in connection with a related health care fraud scheme and his case is still pending; the charges and allegations against Ellis are merely accusations, and he is presumed innocent unless and until proven guilty.

Attorney for the United States Khanna credited special agents of the U.S. Department of Health and Human Services, Office of Inspector General, under the direction of Special Agent in Charge Naomi Gruchacz; and special agents of the U.S. Attorney’s Office for the District of New Jersey, under the direction of Special Agent in Charge Thomas J. Mahoney, with the investigation leading to the guilty plea.

The government is represented by Assistant U.S. Attorney Bernard J. Cooney of the National Security Unit and George L. Brandley of the Health Care Fraud Unit.

 

tamulski.sinformation.pdf

TRENTON, N.J. – An Ocean County, New Jersey, man today admitted conspiring with Eliyahu “Eli” Weinstein, whose 24-year federal prison sentence was commuted after being twice convicted of defrauding investors of a total of $230 million, and others to defraud investors of more than $35 million in a new fraud scheme and to obstruct justice, U.S. Attorney Philip R. Sellinger announced.

Joel Wittels, 57, of Lakewood, New Jersey, pleaded guilty before U.S. District Judge Michael A. Shipp in Trenton federal court to an information charging him with one count of conspiracy to commit securities fraud, one count of conspiracy to obstruct justice, and one count of conspiracy to engage in the unlicensed wholesale distribution of prescription drugs.

“Wittels scammed innocent victims into handing over their money by hiding a twice-convicted fraudster’s identity and capitalizing on the COVID pandemic, the war in Ukraine, and even shortages of baby formula. Instead of investing the money in legitimate ventures, Wittels and his conspirators took it and used some of it to pay off other investors in a classic Ponzi scheme.”

U.S. Attorney Philip R. Sellinger

Three of Wittels’ conspirators, Christopher Anderson, 47, and Richard Curry, 36, and Alaa Hattab, 35, previously pleaded guilty to conspiracy to commit securities fraud and are awaiting sentencing. Charges are still pending against Wittels’ conspirators, Weinstein, Aryeh “Ari” Bromberg, and Shlomo Erez.

According to documents filed in this case and statements made in court:

Weinstein was convicted twice in New Jersey federal court for defrauding investors. His first case involved a real estate Ponzi scheme, and his second case stemmed from additional fraud Weinstein committed while on pretrial release. For these crimes, which resulted in combined losses to investors of approximately $230 million, Weinstein was sentenced to serve 24 years in prison, followed by three years of supervised release. On Jan. 19, 2021, after Weinstein had served less than eight years, the President of the United States at that time commuted Weinstein’s term to time served, leaving intact the rest of his sentence.

Soon after being released from prison, Weinstein began orchestrating a new scheme to solicit money from investors through a company called Optimus Investments Inc. (Optimus). Using the fake name “Mike Konig,” Weinstein ran Optimus with Bromberg and Wittels.

Weinstein, Bromberg, and Wittels received the bulk of investor money through a second company, Tryon Management Group LLC, which was owned and controlled by Anderson and Curry. Tryon promised these individual investors – consisting mostly of friends and family – lucrative opportunities to invest in deals involving COVID-19 masks, scarce baby formula, and first-aid kits supposedly bound for wartime Ukraine. Posing as Mike Konig, Weinstein provided information for these supposed deals. Based on that information, investors gave money to Tryon, believing the deals were legitimate and not knowing about Weinstein’s involvement. In turn, Tryon transferred those funds to Optimus.

In February 2022, almost immediately after Tryon and Optimus started receiving investor money, Tryon was unable to pay its investors. Rather than reveal this information to investors, the conspirators agreed to pool money from existing investors of both Optimus and Tryon and use it to make monthly payments to other investors in a Ponzi-like fashion. The conspirators concealed this arrangement from investors by falsely telling investors that the payments derived from legitimate investment returns, not other investors’ money.

In August 2022, the conspirators had a series of meetings in which Weinstein revealed his true identity to Anderson and Curry. In these meetings, at least two of which included Wittels, Weinstein also admitted to making various false statements about purported Optimus deals and to misappropriating Tryon investor money. Both during and after these August 2022 meetings, the conspirators agreed to continue concealing Weinstein’s identity from investors and to raise additional money to pay off existing Tryon investors, all in an effort to stop the Ponzi Scheme from falling apart and to cover up the conspirators’ fraud.

In addition to defrauding investors, Wittels also conspired with Weinstein, Bromberg, and others to obstruct justice. They helped hide Weinstein’s assets that should have been used to pay over $200 million in restitution that he still owes his previous victims. They also concealed Weinstein’s myriad business activities, which he was required to disclose to the court and which were expressly prohibited by the terms of his supervised release.

Wittels also engaged in a separate criminal conspiracy with Curry and others to distribute wholesale quantities of prescription drugs, including insulin, on the secondary market without a wholesale license. 

The conspiracy charges are each punishable by a maximum of five years in prison and a maximum fine of either $250,000 or twice the gain or loss from the offense, whichever is greatest. Sentencing is scheduled for Aug. 20, 2024.

U.S. Attorney Sellinger credited special agents of the FBI, under the direction of Special Agent in Charge James E. Dennehy, and the Food and Drug Administration, Office of Criminal Investigations’ Metro Washington Field Office, under the direction of Special Agent in Charge George Scavdis, with the investigation leading to the charges in this case. He also expressed appreciation for the Securities and Exchange Commission, under the direction of Antonia Apps, Director of the SEC’s New York Regional Office.

The government is represented by Assistant U.S. Attorneys Carolyn Silane, Jonathan Fayer, and Marko Pesce, of the Economic Crimes Unit in Newark.

The charges and allegatioins against Weinstein, Bromberg, and Erez are merely accusations, and they are presumed innocent unless and until proven guilty.

 

wittels.information.pdf

TRENTON, N.J.– A Middlesex County, New Jersey, man was sentenced to 27 months in prison for his role in a scheme to embezzle $2.37 million from his employer while his was the company’s controller, U.S. Attorney Philip R. Sellinger announced today.

Gerard Beauzile, 63, South Plainfield, New Jersey, pleaded guilty before former Chief U.S. District Judge Freda L. Wolfson, an indictment charging him with one count of wire fraud. U.S. District Judge Michael A. Shipp imposed the sentence on March 26, 2024, in Trenton federal court.

According to documents filed in the case and statements made in court:

From 2014 through December 2020, Beauzile abused his position as controller of a New York-based company to embezzle funds by issuing fraudulent company checks to himself and then depositing those checks into his bank account for his own personal benefit. Beauzile issued approximately 140 company checks to himself with a total value of $2.37 million. Beauzile concealed the theft from the company by falsely entering the fraudulent checks into the company’s accounting system under various company vendor names as the payees, causing the accounting system to falsely reflect that the checks were made payable to company vendors instead of to Beauzile. He also falsified vendor invoices to correspond to the entries made in the accounting system, and company bank statements by removing and altering opening, running, and closing balances, check payment entries, summary check listings, and inter-account transfers.

In addition to the prison term, Judge Shipp sentenced Beauzile to three years of supervised release and ordered restitution of $2.37 million and forfeiture of $2.37 million.

U.S. Attorney Sellinger credited special agents of the FBI, under the direction of Special Agent in Charge James E. Dennehy in Newark, with the investigation leading to today’s sentencing. 

The government is represented by Assistant U.S. Attorney Blake Coppotelli of the U.S. Attorney’s Office Economic Crimes Unit.

NEWARK, N.J. – A Jamaican national admitted making a false statement in an application for a U.S. passport, U.S. Attorney Philip R. Sellinger announced today.

Stefan Anderson, 47, of Jamaica, pleaded guilty before U.S. District Judge Katharine S. Hayden in Newark federal court on March 26, 2024, to one count of false statement in a passport application. The matter, originally indicted in the Western District of Michigan, Southern Division, was transferred by consent to the District of New Jersey for plea and sentencing.

According to documents filed in this case and statements made in court:

On April 21, 2022, Anderson applied for a U.S. passport in Wyoming, Kent County, Michigan. Anderson falsely claimed to be another individual, a United States citizen. Anderson also presented a Michigan Temporary State Identification card bearing that individual’s name and personal identifying information in support of the application.

The count of false statement in a passport application carries a maximum potential penalty of 10 years in prison, and a fine of $250,000. Sentencing is scheduled for June 6, 2024.

U.S. Attorney Sellinger credited the U.S. Department of State, Diplomatic Security Service, Detroit Resident Office and the U.S. Immigration and Customs Enforcement (ICE) Enforcement and Removal Operations, Detroit Field Office with the investigation leading to the  guilty plea.

The government is represented by Assistant U.S. Attorney Chelsea D. Coleman of the Opioid Abuse Prevention and Enforcement Unit in Newark.

 

anderson.indictment.pdf

NEWARK, N.J. – A Florida man was sentenced today to 42 months in prison for illegally obtaining more than $1.5 million in government benefits, U.S. Attorney Philip R. Sellinger announced. 

Michael Blanc, 34, of Miami, Florida, pleaded guilty on Sept. 13, 2023, before U.S. District Judge Michael A. Shipp in Trenton federal court on to an information charging him with wire fraud. Judge Shipp imposed the sentence today in Trenton federal court.

“Michael Blanc today learned the cost of taking advantage of government programs that were specifically designed to provide needed financial assistance to Americans during the COVID-19 pandemic. Combatting pandemic fraud in all of its forms is a top priority for this office and our law enforcement partners. We stand ready with our law enforcement partners to root out those who have exploited the suffering of others to line their own pockets.”

U.S. Attorney Philip R. Sellinger

According to documents filed in the case and statements made in court:

The Coronavirus Aid, Relief, and Economic Security (CARES) Act is a federal law designed to provide emergency financial assistance to Americans suffering the economic effects of the COVID-19 pandemic. It expanded states’ ability to help many workers impacted by COVID-19, including for workers who are not ordinarily eligible for unemployment insurance benefits. The CARES Act also enabled the Small Business Association (SBA) to offer funding through the COVID-19 Economic Injury Disaster Loans (EIDL) program to business owners negatively affected by the COVID-19 pandemic.

Blanc and others applied for unemployment insurance benefits in others’ names without their knowledge or consent and provided false information to induce state workforce agencies to approve those applications. He and others applied for EIDLs in others’ names without their knowledge or consent and provided false information in the applications to induce the SBA to approve the loan applications. Blanc and others obtained more than $1.5 million through their fraudulent scheme.

In addition to the prison term, Judge Shipp sentenced Blanc to three years of supervised release and ordered him to pay $1.7 million in restitution.

U.S. Attorney Sellinger credited special agents of the U.S. Department of Labor, Office of Inspector General, under the direction of Special Agent in Charge Jonathan Mellone, in New York, and the U.S. Treasury Inspector General for Tax Administration, under the direction of Special Agent in Charge is Scott Moffit, Cybercrime Investigations Division, with the investigation leading to today’s guilty plea. He also thanked the FBI, Miami Division, and the New Jersey Department of Labor & Workforce Development for their assistance.

The government is represented by Senior Trial Counsel Andrew Kogan of the U.S. Attorney’s Office Cybercrime Unit in Newark. 

NEWARK, N.J. – A Bergen County, New Jersey, man was charged for producing a video depicting child sexual abuse and receiving and possessing images and videos of child sexual abuse, U.S. Attorney Philip R. Sellinger announced today.

Corey Hipscher, 52, of Lodi, New Jersey, is charged by complaint with one count each of production, receipt and possession of child pornography.  He had his initial appearance before U.S. Magistrate Judge Cathy L. Waldor in Newark federal court on March 26, 2024, and was detained.

According to documents filed in this case and statements made in court:

From 2020 to August 2023, Hipscher communicated with a minor victim located outside of the United States using a social media platform. Hipscher encouraged the minor victim to send Hipscher images and videos of the minor victim engaging in sexually explicit conduct. Hipscher began communicating with the minor victim’s mother, beginning a purported online romantic relationship with the minor victim’s mother which he used to arrange for the minor victim and the minor victim’s family to travel to the United States, specifically New Jersey. During the visit, he sexually assaulted the minor victim and took sexually explicit photos of the minor victim and the minor victim’s sibling.

The charge of production of child pornography carries a mandatory minimum penalty of 25 years in prison and a maximum potential penalty of 50 years in prison and a $250,000 fine. The charge of receipt of child exploitation material carries a mandatory minimum penalty of 15 years in prison, a maximum potential penalty of 40 years in prison, and a $250,000 fine. The charge of possession of child exploitation material carries a minimum penalty of 10 years in prison, a maximum potential penalty of 10 years in prison, and a $250,000 fine.

U.S. Attorney Sellinger credited FBI Newark’s Child Exploitation and Human Trafficking Task Force, under the direction of Special Agent in Charge James E. Dennehy in Newark, with the investigation leading to the charges. U.S. Attorney Sellinger also thanked the Lodi Police Department and the Bergen County Prosecutor’s Office.

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 Child Exploitation and Obscenity Section (CEOS) in the Justice Department’s Criminal Division, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.

The government is represented by Assistant U.S. Attorney Sean Nadel of the General Crimes Unit in Newark.

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

 

hipscher.complaint.pdf

NEWARK, N.J. – A former New Jersey corrections officer admitted orchestrating two different fraud schemes, including a cryptocurrency scheme that resulted in losses of more than $600,000, U.S. Attorney Philip R. Sellinger announced today.

John DeSalvo, 47, of Linwood, New Jersey, pleaded guilty before U.S. District Judge Brian R. Martinotti in Newark federal court on March 25, 2023, to a two-count Information charging him with two counts of securities fraud.

“This defendant preyed on unwitting public servants to trick them into investing their hard-earned savings in a sham token he dubbed ‘the crypto pension’, which he then stole for his personal use. My office will relentlessly pursue these kinds of scammers so that we can work with our partners to bring fraudsters to justice.”

U.S. Attorney Philip R. Sellinger

“DeSalvo admits his role in two fraud schemes, one of which involved him creating and marketing a crypto token to first responders that could supplement their existing pensions,” FBI – Newark Special Agent in Charge James E. Dennehy said.  “Police officers, firefighters, EMTs, and other first responders show up each day to serve and protect, hoping their hard-earned pensions will allow for a nice retirement one day. Many of his victims ended up losing their entire investments. He's now facing the justice he deserves."

According to the documents filed in this case and statements made in court:

The Blazar Token Fraud

DeSalvo was the creator and promoter of a digital token known as “Blazar Token,” (Blazar) which DeSalvo marketed to police, fire personnel, EMTs, and other first responders as a “crypto pension” that could be used to supplement investors’ existing pension plans. DeSalvo promised investors that Blazar would offer “more stability than any other token” and that the value of Blazar would “continue to rise over time similar to any investment fund, only at a much higher rate of success.”

Beginning in late 2021, DeSalvo used social media platforms to fraudulently solicit investments in Blazar through a series of misrepresentations including that Blazar was in the process of becoming, or was already, a securitized token approved by the Securities and Exchange Commission; and Blazar could be purchased through payroll deductions and/or ACH transactions. DeSalvo also falsely told investors that Blazar had been approved for inclusion on several well-known cryptocurrency exchanges and guaranteed investors rates of return of more than 20 percent with “ZERO risk.”

In total, DeSalvo raised more than $620,000 from more than 200 investors in Blazar.  After receiving investor funds, DeSalvo frequently used the funds for various illicit purposes unrelated to Blazar including personal expenses, day-trading in various volatile cryptocurrencies, and payments to prior investors in the manner of a Ponzi scheme.

In May 2022, DeSalvo sold off more than 41 billion of his own Blazar tokens, which caused the price of the token to drop precipitously. The value of Blazar never recovered, causing most investors to lose their entire investments.

The Brokerage-1 Fraud

Between January 2021 and May 2021, DeSalvo managed and solicited investment in an investment group through Brokerage-1, an online trading platform. DeSalvo marketed the investment group largely through social media posts in which DeSalvo falsely touted his success as an investor. For example, DeSalvo claimed to potential investors, “I have been averaging close to 1200% over the last 2 years. I am in the top 1,000th percent in the world. That’s the truth, the return rates I have been averaging are so high that I have people throwing money at me to invest.”

In total, DeSalvo solicited approximately $100,000 in investments from approximately 20 individuals for the investment group. After receiving the funds, DeSalvo engaged in trading activities for a brief period of time before transferring all the funds out of the investment group’s account at Brokerage-1 and into personal accounts held by DeSalvo at Brokerage-1 and Coinbase. DeSalvo then used the funds for various non-investment purposes such as credit card payments, personal trading in volatile cryptocurrencies, and payments to a contractor who performed work on DeSalvo’s personal residence.

After draining the investment group’s account, DeSalvo advised the investment group investors that their funds had been lost due to poor market conditions and provided the investors with false trading records purporting to show the trading activity that DeSalvo engaged in on behalf of the investment group.

The counts of securities fraud carry a maximum potential penalty of 20 years in prison and a fine of $5 million. Sentencing is scheduled for Aug. 6, 2024.

The U.S. Securities and Exchange Commission (SEC) also previously filed a civil complaint against DeSalvo based on the same conduct.

U.S. Attorney Sellinger credited special agents of the FBI’s Atlantic City Resident Agency, under the direction of Special Agent in Charge James E. Dennehy in Newark and detectives from the New Jersey Division of Criminal Justice, Cyber Crimes Bureau, under the direction of Director Stephen Ferketic, with the investigation leading to the guilty plea. 

The government is represented by Assistant U.S. Attorney Anthony Torntore, Chief of the U.S. Attorney’s Cybercrime Unit in Newark.

desalvo.information.pdf

CAMDEN, N.J. – A husband and wife, formerly of Burlington County, New Jersey, and a third codefendant have pleaded guilty to tax evasion and other charges related to their roles in accepting millions of dollars in a romance fraud, after their conspirators met and wooed the victims on online dating sites, U.S. Attorney Philip R. Sellinger announced.

Martins Friday Inalegwu, 35, formerly of Maple Shade, New Jersey, pleaded guilty today to an information charging him with one count of conducting an unlawful money transmitting business and four counts of tax evasion. Inalegwu’s wife, Steincy Mathieu, 27, also formerly of Maple Shade, pleaded guilty on Nov. 28, 2023, to two counts of an indictment charging her with tax evasion. Oluwaseyi Fatolu, 56, of Springfield, New Jersey, pleaded guilty on Jan. 8, 2024, to a count of the indictment charging her with operating an unlawful money transmitting business. All three defendants pleaded guilty before U.S. District Judge Christine P. O’Hearn in Camden federal court.

“These defendants took advantage of more than 100 vulnerable victims, preying on their loneliness to convince them to send money to scammers the victims believed were romantic partners. In this way, they stole millions of dollars. This conspiracy involved swindling, illegal money transfers and tax evasion. Our office will always be ready to work with our law enforcement partners to root out these schemes and bring the perpetrators to justice.”

U.S. Attorney Philip R. Sellinger

“All fraud schemes hurt victims who end up losing part or all of their hard-earned fortunes, savings or retirements,” FBI – Newark Special Agent in Charge James E. Dennehy said. “However, romance scams take on an insidious level of harm. Few of us would want to admit we fell for this type of scam, but we’re all human and scammers prey on that fact. The subjects are owning up to their crimes, but it may not provide much solace for the victims left broke and heartbroken.”

“Martins Inalegwu and his co-conspirators face serious justice for stealing hard-earned money from more than 100 victims who were unaware their relationship was part of a financial fraud or romance scam,” HSI Newark acting Special Agent in Charge Michael Alfonso said. “As always, we urge the public to remain cautious when communicating online, know the tips to recognize a scam and report any suspicious activity to law enforcement. HSI Newark, along with our law enforcement partners, remains committed to dismantling criminal networks attempting to operate financial fraud schemes.”

“Romance scams can prove costly in terms of money, but they also cause great emotional harm to victims and their families,” Tammy Tomlins, Special Agent in Charge of IRS – Criminal Investigation, Newark Field Office, said. “The defendants cheated honest taxpayers out of millions and cheated the United States government by evading their tax liability. Today’s guilty plea demonstrates how IRS – Criminal Investigation special agents and our law enforcement partners continue to use our financial expertise to identify and investigate these types of schemes.”

“Romance scams frequently target elderly or vulnerable citizens and are particularly egregious crimes,” Postal Inspector in Charge, Christopher A. Nielsen, Philadelphia Division, said. “Let this investigation put fraudsters on notice that with our law enforcement partners, the Postal Inspection Service  will investigate and pursue those individuals who scam, harass, and steal from the American people.” 

According to the documents filed in this case and statements made in court:

From October 2016 to May 13, 2020, Inalegwu, Mathieu and their conspirators, several of whom reside in Nigeria, participated in an online romance scheme, defrauding more than 100 victims throughout the country. The conspirators made initial contact with victims through on-line dating and social media websites, corresponded with victims via email and phone, pretended to strike up a romantic relationship with victims, wooed them with words of love, and then requested the victims send money to them, or their associates, for fictitious emergency needs. In all instances, the individuals whom the victims believed they were speaking to did not exist, and instead they were speaking to the conspirators of this scheme.  

At the conspirators’ directions, victims wired money to bank accounts held by Inalegwu and Mathieu in the United States, and also mailed checks directly to Inalegwu and Mathieu. Some victims transferred money to Inalegwu and Mathieu via money transfer services, such as Western Union or MoneyGram, and others wired money to bank accounts held by conspirators overseas.

Federal law enforcement agents have identified more than 100 victims, who sent over $4.5 million directly to Inalegwu and Mathieu, and several million more to conspirators. In turn, Inalegwu and Mathieu spent the victims’ money on personal expenses, withdrew money in cash, transferred money to other bank accounts they personally controlled, and transferred money to bank accounts in Nigeria and Turkey. Inalegwu used the unlawful money transmitting service provided by Fatolu to unlawfully transfer a portion of the victim money to these foreign accounts. Inalegwu and Mathieu failed to pay any taxes on the millions of dollars they accepted from victims.

Each count of tax evasion is punishable by a maximum of five years in prison and a $250,000 fine. Each count of conducting an unlawful money transmitting business is punishable by a maximum of five years in prison and a $250,000 fine.

U.S. Attorney Philip R Sellinger credited special agents of the FBI, under the direction of Acting Special Agent in Charge James E. Dennehy in Newark; special agents of Homeland Security Investigations Newark, under the direction of Acting Special Agent in Charge Michael Alfonso; special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Tammy Tomlins; postal inspectors of the U.S. Postal Inspection Service under the direction of Inspector in Charge Christopher A. Nielsen, Philadelphia Division; and special agents of the United States Attorney’s Office, under the direction of Special Agent in Charge Thomas Mahoney, with the investigation leading to the guilty pleas.

The government is represented by Assistant U.S. Attorney Martha K. Nye of the U.S. Attorney’s Office in Trenton.

 

inalegwu.sinformation.pdf

NEWARK, N.J. – The owner of a New Jersey company today admitted mislabeling hazardous chemicals entering the United States and evading customs duties, U.S. Attorney Philip R. Sellinger announced.

George Volpe, 60, of Roseland, New Jersey, owner of Penta International Inc. (Penta), pleaded guilty before U.S. District Judge Esther Salas in Newark federal court to an information charging him with wire fraud. Sentencing is scheduled for Aug. 13, 2024. The company also agreed to a civil settlement to resolve allegations that Penta evaded customs duties and caused the mislabeling of chemicals imported into the United States from China.

According to documents filed in this case and statements made in court:

Penta is a New Jersey-based company run by Volpe and his family. Volpe admitted that, from January 2016 through August 2021, as the manager and owner of Penta, he participated, in a scheme to defraud, through which he caused mislabeled chemicals, including hazardous chemicals, to enter the United States from China. The fraudulent scheme resulted in an underpayment of U.S. Customs duties in the amount of $1.4 million.

As part of the civil settlement with the United States to resolve allegations under the False Claims Act, Penta has agreed to pay $3.1 million plus interest. The civil claims alleged that Penta representatives conspired with a Chinese vendor to mislabel chemicals entering the United States and to use falsified documents submitted to Penta’s customs brokers. As part of the settlement, Penta admitted that it mislabeled substances in connection with their importation to the United States.

The civil settlement with Penta resolves a lawsuit filed under the whistleblower provision of the False Claims Act, which permits private parties, called relators, to file suit on behalf of the United States for false claims and share in a portion of the government’s recovery. The relator, Angel Figueroa, will receive $600,000 of the $3.1 million civil settlement amount recovered by the United States pursuant to the False Claims Act.

U.S. Attorney Sellinger credited special agents of Homeland Security Investigations Newark, under the direction of Acting Special Agent in Charge Michael Alfonso; U.S. Customs and Border Protection, Office of Field Operations officers under the direction of port director TenaVel Thomas; auditors with U.S. Customs and Border Protection, Office of Trade Regulatory Audit under the direction of Field Director Roderick “Rick” Lawlor; and the Drug Enforcement Administration, under the direction of Special Agent in Charge Cheryl Ortiz of the New Jersey Field Office, with the investigation.

The government is represented in the criminal case by Assistant U.S. Attorney Fatime Meka Cano of the Economic Crimes Unit in Newark, and in the civil case by Assistant U.S. Attorney Mark Orlowski of the Health Care Fraud Unit in Newark.

 

volpe.information.pdf

NEWARK, N.J. – A member of an MS-13 clique operating in Hudson County, New Jersey, was sentenced today to 10 years in prison for his role in a gang-related murder plot, U.S. Attorney Philip R. Sellinger announced.

Jose Gimenez-Lobos, aka “Infernal,” aka “Terrible,” 33, previously pleaded guilty before U.S. District Judge Claire C. Cecchi in Newark federal court to his role in a failed May 2015 plot to kill a member of a rival gang. Judge Cecchi ordered that the sentence imposed today run concurrently to the 40-year sentence Gimenez-Lobos received in the Eastern District of Virginia for his role in a November 2014 murder that he committed on behalf of MS-13. 

“This defendant has already amassed a history of death and mayhem on behalf of MS-13, a gang well-known for its appetite for violence. There is no place in our communities for this wanton disregard of life. Gimenez-Lobos will remain behind bars for most of the remainder of his life, which is the punishment he has brought down on his own head.”

U.S. Attorney Philip R. Sellinger

“Many violent street gangs focus on crimes to make money and use violence as a way to defend their so-called turf,” FBI-Newark Special Agent in Charge James E. Dennehy said. “For MS-13, they use their criminal behavior as a means to perpetuate violence simply for the sake of violence. Gimenez-Lobos sent his minions after a rival gang member, but having failed to carry out his plan, he then had them savagely beaten. The brutality and total disregard for human life is the point. I would like to commend the agents and investigators on this case. Pursuing and bringing to justice members of MS-13 can be a harrowing job, but they do it to protect our communities.”

“This is another clear example of the strong partnership that exists amongst federal, state, and local law enforcement agencies in New Jersey,” Newark ICE Enforcement and Removal Field Office Director John Tsoukaris said. “This cooperation was critical in the arrest, prosecution and sentencing of an MS-13 gang member, a group notorious for its violent crimes. ICE ERO remains committed to our public safety mission as we enforce our immigration laws.”  

“Jose Gimenez-Lobos is a convicted felon and MS-13 gang member, whose violent behavior has earned him a second prison sentence,” said HSI Newark Acting Special Agent in Charge Michael Alfonso. “Thanks to the collaboration with our law enforcement partners in New Jersey and neighboring states, this MS-13 criminal will be put away for decades. HSI Newark remains determined to keep our communities safe from dangerous gang members who show no regard for human life.”

According to documents filed in this case and statements made in court:

Gimenez-Lobos and others previously pleaded guilty to their involvement in a failed May 2015 plot to kill a member of a rival gang. Gimenez-Lobos admitted his membership in the violent transnational street gang, MS-13, and admitted his involvement in acts of violence and drug distribution on behalf of the gang. Gimenez-Lobos and fellow MS-13 gang members conspired to kill a member of the rival 18th Street gang from the Maryland/Virginia area.  The plot involved a female associate of MS-13 who befriended the victim and then lured him to New Jersey so that MS-13 members could execute him.

The victim arrived in Hudson County on May 25, 2015.  A high-ranking MS-13 member ordered three other MS-13 members, including Gimenez-Lobos, to carry out the murder. When their initial attempts to contact the victim did not go as planned, the MS-13 members decided to secure a room for the victim at a local motel and offered to transport him back to the Maryland/Virginia area the following day. At their clique leader’s direction, the MS-13 members agreed to stab the victim to death at some point during the trip, and then dispose of the body.

The murder was foiled the following day when the victim – sensing that the MS-13 members planned to harm him – jumped from the vehicle outside a tollbooth on the way to the Maryland/Virginia area. The MS-13 members later received beatings for failing to kill the rival 18th Street gang member.

U.S. Attorney Sellinger credited special agents of the FBI, under the direction of Special Agent in Charge James E. Dennehy in Newark; officers of the Immigration and Customs Enforcement – Enforcement and Removal Operations Newark Field Office, under the direction of Field Office Director Tsoukaris; special agents of Homeland Security Investigations Newark, under the direction of Acting Special Agent in Charge Michael Alfonso; special agents of HIS Washington, D.C., under the direction of Special Agent in Charge Derek W. Gordon; investigators of the Hudson County Prosecutor’s Office, under the direction of Prosecutor Esther Suarez; and investigators of the West New York Police Department under the direction of Director of Public Safety Alejandro DeRojas.

The government is represented by Assistant U.S. Attorney Desiree Grace, Deputy Chief of the U.S. Attorney’s Office’s Criminal Division in Newark, and Trial Attorney Matthew K. Hoff of the Department of Justice’s Organized Crime and Gang Section.

NEWARK, N.J. – A Hudson County, New Jersey, woman was sentenced today to 60 months in prison for stealing over $1.5 million from over 100 victims made up mainly of non-profits, private schools, and religious institutions throughout New Jersey, U.S. Attorney Philip R. Sellinger announced.

Yezenia Castillo, 47, of Hoboken, New Jersey, previously pleaded guilty before U.S District Judge Susan D. Wigenton, to an information charging her with one count each of wire fraud and tax evasion. Judge Wigenton imposed the sentence today in Newark federal court.

According to documents filed in this case and statements made in court:

From 2012 through 2021, Castillo falsely claimed to be a CPA who could provide various financial and accounting services to non-profit organizations throughout New Jersey, including private schools and religious institutions. Castillo was not a CPA and never provided any of these promised services. After she was hired, Castillo used various ways to steal from her clients, including collecting fees for services that she never performed and transferring client funds to herself without authorization. Castillo also collected funds from clients by falsely claiming she would use it to pay their taxes, but she instead kept the money. To conceal her fraud, Castillo told victims that she had filed and paid their taxes, and she falsified receipts to make it appear to the victims as if their taxes were paid. Castillo defrauded over 100 victims, resulting in financial losses totaling over $1.5 million. 

In addition to the prison term, Judge Wigenton sentenced Castillo to three years of supervised release and ordered restitution of $3.25 million and forfeiture of $3.25 million.

U.S. Attorney Philip R. Sellinger credited special agents of the FBI, under the direction of Special Agent in Charge James E. Dennehy in Newark; special agents of the U.S. Department of Housing and Urban Development, Office of the Inspector General, under the direction of Acting Special Agent in Charge William Woolard; and special agents of IRS – Criminal Investigation, under the direction of Special Agent in Charge Tammy L. Tomlins, with the investigation leading to the sentencing.

The government is represented by Assistant U.S. Attorney Blake Coppotelli of the U.S. Attorney’s Office Economic Crimes Unit.

TRENTON, N.J. – A former Princeton resident was charged today with engaging in multiple fraudulent schemes intended to steal millions of dollars from individual and institutional victims, U.S. Attorney Philip Sellinger announced.

Ford Graham, 60, formerly of Princeton, New Jersey, is charged in a 29-count indictment with 14 counts of wire fraud, one count of conspiracy to commit wire fraud, one count of securities fraud, three counts of aggravated identity theft, nine counts of money laundering and one count of engaging in unlawful money transactions.

“As alleged in the indictment, this defendant used multiple schemes to steal millions of dollars from victims. The indictment sets forth the different strategies the defendant allegedly employed to dupe innocent third parties into giving the defendant their hard earned money. My office will continue to devote substantial resources to investigating and prosecuting fraudsters who take advantage of the financial system for illicit financial gain.”

U.S. Attorney Philip R. Sellinger

“We allege Graham used a litany of fraud schemes to steal money from his investors,” FBI – Newark Special Agent in Charge James E. Dennehy said. “Our thorough investigation illustrates how he moved from one to the next, using millions of dollars to fund his lavish life but not his promised investments. The victims in this case, and thousands of others across the country, are losing incredible amounts of money to fraudsters who only see them as personal piggy banks. FBI Newark and our law enforcement partners tackle the mountain of evidence all with the sole purpose of bringing these criminals to justice.” 

“Today's indictment of the defendant sends a clear message, that we have the tools and internal fortitude to protect our financial systems by investigating, prosecuting, and holding accountable, those who seek to defraud the public,” Tammy Tomlins, Special Agent in Charge of IRS - Criminal Investigation Newark Field Office, said. “IRS - Criminal Investigation and our law enforcement partners are committed to safeguarding the public.” 

According to the criminal complaint and statements made in court:

From December 2012 to September 2013, Graham held himself out as the owner, chief executive, chairman, manager, and/or principal member of dozens of corporate entities purporting to do business under an umbrella organization, Vulcan Capital Corporation (Vulcan). Acting through and on behalf of Vulcan and its associated entities, Graham held himself out as a highly successful financier who had vast experience sponsoring complex energy and natural resource projects and other investment deals. In connection with one such investment that Graham and a Vulcan entity sponsored, one victim invested more than $2 million with Graham, relying on Graham’s misrepresentations and omissions regarding the investment. The investigation revealed that Graham misappropriated substantial amounts of the victim’s investment money and used it for his own personal benefit and enrichment – including, among other things, international vacations, private school tuition for his children, and other personal amenities – instead of the investment purpose that Graham had marketed. Through this and other fraudulent misrepresentations uncovered during the investigation, Graham caused multiple victims to lose a total of more than $2.6 million.

Graham also actively participated in a scheme to defraud merchant processing institutions through fraudulent credit card transactions. From December 2017 to February 2018, Graham used at least one payment processing platform to process fraudulent charges on stolen credit card numbers that he obtained. After the payment processing platform credited Graham’s account with the payments requested, Graham quickly transferred or caused to be transferred the fraudulently obtained money to other accounts before the victim institutions could act. When requested by the victim payment processing company to provide supporting documentation, Graham submitted false documentation, including fabricated invoices and credit card authorization forms, fabricated e-mails, forged signatures, altered bank statements, and other false and fraudulent information. This scheme resulted in tens of thousands of dollars of losses and the misappropriation of multiple victims’ personal identification information.

From February 2017 to June 2018, Graham conspired with others to defraud victim institutions and individuals of millions of dollars through a business email compromise scheme. Members of the conspiracy sent fraudulent e-mail communications to victims who were scheduled to make substantial outgoing wire transfers to third parties. These fraudulent e-mails created the appearance that they had been sent by the intended third-party recipients of the scheduled payments when, in fact, they were sent by members of the conspiracy. The fraudulent emails requested the victims to reroute the scheduled payments to different bank accounts that Graham and his conspirators controlled. In one instance, a fraudulent email successfully induced one victim to reroute a payment of more than $650,000 to a bank account that Graham controlled. Graham transferred or caused to be transferred substantial portions of those funds to other accounts that he controlled, and which he used and intended to use for his own personal benefit. Through the business email compromise scheme, Graham and his conspirators attempted to defraud multiple victims of at least $6 million.

The wire fraud and wire fraud conspiracy counts each carry a maximum potential penalty of 20 years in prison and a fine of $250,000, or twice the gross amount of gain or loss from the offense, whichever is greatest. The securities fraud charge is punishable by a maximum potential penalty of 20 years in prison and a $5 million fine. Each count of aggravated identity theft is punishable by a statutory mandatory consecutive sentence of two years, which must run consecutively to any other sentence. Each count of money laundering carries a maximum penalty of 20 years and a fine of $500,000 or not more than twice the value of the property involved in the transaction. The charge of engaging in unlawful monetary transactions carries a maximum potential penalty of 10 years in prison and a fine of $250,000 or twice the gross gain or loss from the offense or not more than twice the amount of the criminally derived property involved in the transactions.

U.S. Attorney Sellinger credited special agents of the FBI, Newark Division, Red Bank Resident Agency, under the direction of Special Agent in Charge James E. Dennehy; special agents of IRS - Criminal Investigation, under the direction of Special Agent in Charge Tammy Tomlins, with the investigation leading to the charges. U.S. Attorney Sellinger also thanked investigators with the New Jersey Bureau of Securities, under the direction of Chief Christopher W. Gerold, for their assistance in connection with the investigation.

The government is represented by Assistant U.S. Attorney Martha K. Nye of the Criminal Division in Trenton.

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

 

graham.indictment.pdf

NEWARK, N.J. – An Essex County, New Jersey, man today admitted his role in a narcotics conspiracy involving approximately one kilogram of cocaine and 100 grams of fentanyl, possessing with intent to distribute approximately 482 grams of cocaine, and possessing three firearms and ammunition as a convicted felon, U.S. Attorney Philip R. Sellinger announced.

Carlos Ovidio Gonzalez, 36, of Newark, pleaded guilty before U.S. district Judge Cecchi in Newark federal court to one count of conspiracy to distribute and possess with intent to distribute cocaine and fentanyl, one count of possession with intent to distribute cocaine, and one count of possession of firearms and ammunition by a convicted felon.

According to documents filed in this case and statements made in court:

On Dec. 19, 2022, Gonzalez and another individual conspired to distribute approximately one kilogram of cocaine and 100 grams of fentanyl and were arrested shortly after arriving at an agreed-upon location in Kearny to complete the sale. After their arrests, a search of Gonzalez’s home and an apartment uncovered two loaded firearms, an unloaded firearm, ammunition, drug packaging materials, and drugs, including approximately 482 grams of heroin.  Gonzalez had previously been convicted, in New Jersey Superior Court, Morris County, of first-degree drug distribution, second degree weapons possession during a controlled substance offense, and second degree possession of a firearm for an unlawful purpose, and was sentenced in 2009 to 30 years in prison.

The counts of fentanyl and cocaine conspiracy and possession with intent to distribute cocaine carry maximum penalties of 30 years in prison and a $2 million fine. The felon in possession count carries a maximum penalty of 15 years in prison and a $250,000 fine. Sentencing is scheduled for Aug. 6, 2024.

U.S. Attorney Sellinger credited special agents of the FBI, under the direction of Special Agent in Charge James E. Dennehy in Newark, and officers with the Essex County Prosecutor’s Office, under the direction of Prosecutor Theodore N. Stephens II, with the investigation leading to the charges. He also thanked Newark Police Department for its assistance.

The government is represented by Assistant U.S. Attorney Eli Jacobs of the General Crimes Unit in Newark.

 

gonzalez.information.pdf

TRENTON, N.J. – A Brooklyn man was sentenced today to 84 months in prison for his role in for conspiring with others in a week-long strongarm extortion scheme in 2019, U.S. Attorney Philip Sellinger announced today.

Endrit Kllogjeri, 30, of Brooklyn, New York, was previously convicted of one count each of conspiracy to commit Hobbs Act extortion and attempt to commit Hobbs Act extortion following a one-week jury trial in June 2023 before U.S. District Judge Zahid N. Quraishi.  Judge Quraishi imposed the sentence today in Trenton federal court. Kllogjeri’s codefendant, Francis Garzon previously pleaded guilty and was sentenced to 121 months in prison by Judge Quraishi in January 2024. 

According to documents filed in this case, statements made in court, and the evidence at trial:

From Dec. 1, 2019, through Dec. 9, 2019, Kllogjeri and Garzon conspired and attempted to extort a resident of Monmouth County, New Jersey and the resident’s son, who lived in Brooklyn, New York. The victim was allegedly threatened with physical harm if the victim did not recover a bag containing property allegedly valued at $100,000 from the victim’s son.  Garzon and Kllogjeri further demanded an additional payment of $100,000 as “interest” for the son’s possession of the bag. Over the ensuing week, Garzon and Kllogjeri communicated regularly with the victim’s telephone, continuing to threaten the victim and the victim’s family. Garzon and Kllogjeri were arrested together in a vehicle on Dec. 9, 2019 in Brooklyn. Moments before the arrest, Garzon had attempted to send the victim a text message confirming the victim’s plan to pay the demand.

In addition to the prison term, Judge Quraishi sentenced Kllogjeri to three years of supervised release following Kllogjeri’s release from prison. 

U.S. Attorney Sellinger credited special agents with the FBI, under the direction of Special Agent in Charge James E. Dennehy in Newark, with the investigation leading to today’s conviction. He also credited the Marlboro Township Police Department, under the direction of Chief Peter Pezzullo; and the New York City Police Department for their assistance.

The government is represented by Assistant U.S. Attorney Eric A. Boden, Attorney-in-Charge of the Trenton Office, and Assistant U.S. Attorney Ian D. Brater of the U.S. Attorney’s Office’s Criminal Division in Trenton.

CAMDEN, N.J. – A Philadelphia man was sentenced today to 50 months in prison for conspiring to distribute five kilograms or more of cocaine as part of a drug-trafficking organization operating in Philadelphia and southern New Jersey, U.S. Attorney Philip R. Sellinger announced.

Iran Soler, 44, Philadelphia, previously pleaded guilty before U.S. District Judge Christine P. O’Hearn to an information charging him with one count of conspiring to distribute five kilograms or more of cocaine. Judge O’Hearn imposed the sentence today in Camden federal court.

According to documents filed in this case and statements made in court:

Soler and his conspirators traveled to San Juan, Puerto Rico, on commercial flights from Philadelphia International Airport on numerous occasions between March 2019 and August 2020. They purchased multi-kilogram quantities of cocaine from wholesale drug suppliers based in the San Juan area in exchange for cash payments. Soler and the conspirators then shipped the kilograms of cocaine by overnight delivery from U.S. Post Offices in San Juan to various addresses in Philadelphia and southern New Jersey, where a conspirator, Jose Gonzalez, resold the cocaine to other drug dealers in the Philadelphia area for a profit. Soler and the other conspirators purchased and shipped over 100 kilograms of cocaine to Philadelphia and southern New Jersey between March 2019 and August 2020.  

In addition to the prison term, Judge O’Hearn sentenced Soler to five years of supervised release.

Gonzalez previously pleaded guilty to his role in the conspiracy and is scheduled to be sentenced April 29, 2024.

U.S. Attorney Sellinger credited postal inspectors of the U.S. Postal Inspection Service, Philadelphia Division, under the direction of Inspector in Charge Christopher A. Nielsen; agents of the U.S. Postal Service, Office of Inspector General, Northeast Area Field Office, under the leadership of Special Agent in Charge Matthew Modafferi; special agents of the FBI’s Atlantic City Resident Agency, under the direction of Special Agent in Charge James E. Dennehy in Newark; special agents of the FBI, under the direction of Special Agent in Charge Wayne A. Jacobs in Philadelphia; troopers assigned to the New Jersey State Police Strategic Investigations Unit South, under the direction of Col. Patrick J. Callahan; and officers and detectives of the Philadelphia Police Department, under the direction of Police Commissioner Kevin J. Bethel, with the investigation leading to today’s sentencing.

The government is represented by Assistant U.S. Attorney Patrick C. Askin of the U.S. Attorney’s Office Criminal Division in Camden.

NEWARK, N.J. – A Morris County, New Jersey, man was charged today in a scheme that defrauded victims of over $3.4 million dollars, U.S. Attorney Philip R. Sellinger announced.

Mark Csantaveri, 51, of Morristown, New Jersey, is charged by complaint with one count of conspiracy to commit wire fraud. He made an initial appearance today before U.S. Magistrate Judge Edward S. Kiel in Newark federal court and was detained.

According to documents filed in this case and statements made in court:

Csantaveri and his conspirators operated businesses that purported to provide small businesses with debt relief services. Csantaveri induced victims to make regular payments to one of Csantaveri’s businesses by falsely claiming that he would hold their money while negotiating favorable settlements with the victims’ creditors. Instead of using victim funds as promised, Csantaveri and his conspirators misappropriated the victims’ money for their personal use, including over $1 million in gambling expenses. Csantaveri’s scheme ultimately defrauded more than 50 victims of more than $3.4 million dollars.

Conspiracy to commit wire fraud is punishable by a maximum of 20 years in prison and a fine of $250,000 or twice the gross gain or loss involved in the offense, whichever is greatest.

U.S. Attorney Sellinger credited special agents of the FBI, under the direction of Special Agent in Charge James E. Dennehy in Newark, with the investigation leading to the charges.

The government is represented by Assistant U.S. Attorney Aaron L. Webman of the of the Criminal Division in Newark.

The charge and allegations contained in the complaint are merely accusations, and the defendants is presumed innocent unless and until proven guilty.

 

csantaveri.complaint.pdf

NEWARK, N.J. – A Denver, Colorado, CEO was sentenced to 71 months in prison for conducting a securities scheme to fraudulently obtain $10.4 million from investors through various misrepresentations about fund operations, his background, and his contribution to the fund, U.S. Attorney Philip R. Sellinger announced today.

Samuel J. Mancini, 57, previously pleaded guilty before U.S. District Court Judge Cecchi to an information charging him with one count of securities fraud. Judge Cecchi imposed the sentence in Newark federal court.

“This defendant concocted an elaborate scheme to swindle unsuspecting victims out of their hard-earned money. His lies and theft were successful to the tune of $10.4 million – right up to the moment law enforcement caught up with him. He will now spend the next several years of his life in prison, a just punishment for his crimes.”

U.S. Attorney Philip R. Sellinger

“Schemes to make easy money on the backs of honest investors never work,” FBI – Newark Special Agent in Charge James E. Dennehy said. “History is littered with criminals similar to Mancini who think they will ultimately walk away with the millions they’ve stolen. It never works. At the end of the day, victims aren’t just going to accept their money is gone and not demand justice. That’s where the FBI – Newark and our law enforcement partners can help, so please reach out to us if you face a similar situation like the victims who believed in Mancini.”

According to documents filed in this case and statements made in court:

Mancini managed and controlled Outdoor Capital Partners LLC (OCP), which he purported to be a venture capital and private equity firm. OCP served as the managing director of OCP Italia Fund LLC (OCP Italia), a private investment fund. Mancini used OCP and OCP Italia to engage in the fraudulent scheme.

 From February 2020 through July 2021, Mancini promised investors that he was raising $20 million, including $5 million of his own money, for OCP Italia to invest solely in acquiring controlling interests in three Italian cycling companies. Mancini represented to investors that the acquisitions would take place soon after the fund closed. To induce investments, Mancini promised investors approximately 70 percent of OCP Italia’s operating profits. 

Mancini repeatedly misrepresented his finances and his contribution to OCP Italia.  Mancini also misrepresented OCP Italia’s ability to close on the acquisitions. OCP Italia never acquired any of the Italian cycling companies. Instead, Mancini defaulted on contracts, diverted investor funds out of OCP Italia, and, in certain instances, paid investor funds to other investors seeking redemption.

 Mancini also misled investors about his educational background by representing himself as a graduate of a prestigious military academy when, in fact, Mancini had failed to graduate from the academy due to an ethical violation. 

When confronted with requests for transparency and redemptions by certain investors in OCP Italia, Mancini failed to honor the redemption requests, made misrepresentations about his inability to honor the redemption requests, misstated and omitted material facts, and provided certain investors with forged, modified, or otherwise fraudulent documentation and financial records. Mancini fraudulently obtained approximately $10.4 million from victims. 

In addition to the prison term, Judge Cecchi sentenced Mancini to three years of supervised release.

The U.S. Securities and Exchange Commission has filed a civil complaint against Mancini based on the allegations underlying the securities fraud scheme to which Mancini pleaded guilty today.

U.S. Attorney Sellinger credited special agents and intelligence analysts of the FBI, under the direction of Special Agent in Charge James E. Dennehy in Newark, with the investigation leading to the sentencing. He also thanked the FBI Denver Field Office, under the direction of Special Agent in Charge Mark D. Michalek.

The government is represented by Assistant U.S. Attorney Lauren E. Repole, Deputy Chief of the Economic Crimes Unit, and Assistant U.S. Attorney James H. Graham of the Organized Crime/Gangs Unit.

NEWARK, N.J. – The owner of a New Jersey counseling center today admitted her role in a health care fraud scheme involving hundreds of false claims, U.S. Attorney Philip R. Sellinger announced. 

Maria P. Cosentino, 60, of Garfield, New Jersey, pleaded guilty before U.S. District Judge Katharine S. Hayden in Newark federal court to an information charging her with participating in a health care fraud scheme.

“Patients need to be able to use their health insurance plans to obtain needed services. This defendant admitted today that she falsified claims in order to boost her payments, in some cases, making up visits for counseling and other treatments out of whole cloth. My office is determined to root out those who would try to rig the system for ill-gotten profits.”

U.S. Attorney Philip R. Sellinger

“Fraudsters compromise the integrity of our health care system and necessary treatment programs,” FBI – Newark Special Agent in Charge James E. Dennehy said. “Cosentino now admits she billed private health insurance companies for sessions with patients who no longer attended her practice, were out of the country, or didn't even exist. Everyone ends up bearing the cost of these scams which drain billions of dollars annually from the healthcare industry. We ask if you have any information about similar fraud, call the Newark FBI so we can take action.”

According to documents filed in the case and statements made in court:

Cosentino owned Bergen Alliance Counseling Services, which provided counseling services and mental health treatment to children, families, couples, and adults. She admitted that for years she submitted false claims to private health insurance plans for counseling sessions that she never provided. Cosentino falsely claimed that various individuals had received counseling at the center when in fact they had been out of the country, had ceased attending the practice, or had never visited the counseling center at all. The false claims caused insurance plans to issue reimbursement checks to the center even though the individuals had never received any treatment. Cosentino kept the illicit profits, which totaled more than $700,000. 

The charge of health care fraud is punishable by a maximum of 10 years in prison and a maximum fine of either $250,000 or twice the gain or loss from the offense, whichever is greatest. Sentencing is scheduled for July 23, 2024.

U.S. Attorney Sellinger credited special agents of the FBI, under the direction of Special Agent in Charge James E. Dennehy in Newark, with the investigation leading to the guilty plea.

The government is represented by Assistant U.S. Attorney DeNae Thomas of the Health Care Fraud Unit in Newark.

 

cosentino.information.pdf

 

NEWARK, N.J. – Three individuals were charged today for falsely seeking more than $2.9 billion from the IRS by filing 131 false tax forms claiming COVID-19 related employment tax credits, U.S. Attorney Philip R. Sellinger announced.

Rudolph Johnson, Frantz Pasteur, and Frederick Anderson, all of Irvington, New Jersey, are each charged by complaint with one count of conspiracy to file false claims against the government and one count of conspiracy to commit wire and mail fraud. Additionally, Johnson is charged with three counts of money laundering, Pasteur with two counts of money laundering, and Anderson with three counts of money laundering. Johnson and Pasteur appeared today before U.S. Magistrate Judge Michael A. Hammer in Newark federal court and were released on bail. Anderson will appear at a later date.

According to the documents filed in this case and statements made in court:

In response to the COVID-19 pandemic and its economic impact, Congress authorized an employee retention tax credit (ERC) that a small business could use to reduce the employment tax it owed to the IRS.

To qualify, the business had to have been in operation in 2020 and to have experienced at least a partial suspension of its operations because of a government order related to COVID-19 (for example, an order limiting commerce, group meetings or travel) or a significant decline in profits. The credit was an amount equal to a set percentage of the wages that the business paid to its employees during the relevant time period, subject to a maximum amount. Congress also authorized the IRS to give a credit against employment taxes to reimburse businesses for the wages paid to employees who were on sick or family leave and could not work because of COVID-19.

From June 2021 to November 2023, Johnson, Pasteur, and Anderson established a slew of sham entities and filed fraudulent IRS forms in the names of these entities claiming fraudulent entitlement to tax refunds, including the ERC. These entities had limited tax histories, never paid any W-2 wages, and made only nominal, if any, payments to the IRS.  In total, the defendants claimed $2.9 billion in tax benefits, and as a result, the U.S. Treasury issued $1.03 million in refunds. Subsequently, the defendants deposited the falsely claimed refunds into their bank accounts and used the money to purchase various items such as luxury cars to fraudulently enrich themselves.

The conspiracy to file false claims against the government offense carries a maximum penalty of 10 years in prison and a $250,000 fine. The conspiracy to commit wire and mail fraud offense carries a maximum penalty of 20 years in prison and a $250,000 fine. Each of the money laundering offenses carries a maximum penalty of 10 years in prison and a $250,000 fine or twice the value of the criminally derived property.

U.S. Attorney Sellinger credited special agents of IRS – Criminal Investigation, under the direction of Special Agent in Charge Tammy Tomlins; and postal inspectors from the U.S. Postal Service, under the direction of Inspector in Charge Christopher A. Nielsen, Philadelphia Division, with the investigation leading to today’s charges. A civil referral from the IRS Office of Fraud Enforcement contributed to the indictments in this criminal complaint.

The District of New Jersey COVID-19 Fraud Enforcement Strike Force is one of five strike forces established throughout the United States by the U.S. Department of Justice to investigate and prosecute COVID-19 fraud. The strike forces focus on large-scale, multi-state pandemic relief fraud perpetrated by criminal organizations and transnational actors. The strike forces are interagency law enforcement efforts, using prosecutor-led and data analyst-driven teams designed to identify and bring to justice those who stole pandemic relief funds.

The government is represented by Assistant U.S. Attorney Dong Joo Lee of the Cybercrime Unit in Newark.

The charges and allegations contained in the complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

 

johnsonetal.complaint.pdf

NEWARK, N.J. – A Florida-based employee of an international financial institution was arrested today for obstruction of justice after making false statements to agents about accepting bribes, U.S. Attorney Philip R. Sellinger announced.

Gerardo Fermin Aquino Vargas, 38, of Hollywood, Florida, is charged by complaint with one count of obstruction of justice. Aquino had his initial appearance today before U.S. Magistrate Judge Jared M. Strauss in Miami, Florida federal court and was released on $100,000 bond.

According to documents filed in this case and statements made in court:

Aquino worked for an international financial institution at a branch located in Hollywood. Starting in April 2022, Aquino repeatedly and corruptly accepted bribes from individuals in exchange for opening accounts in the names of straw owners who were not present at the account openings. In exchange for the bribes, Aquino also issued debit cards for these accounts and unblocked debit cards that had been flagged for potential fraud by the financial institution. These accounts were used to transfer millions of dollars from the United States to Colombia.

When Aquino was interviewed by law enforcement in November 2023, he made false statements, including that he had only opened one or two accounts when the purported owners were not present at the bank and that he had never received payment for such actions. In fact, Aquino opened at least 28 accounts in this manner and accepted thousands of dollars in bribes for doing so. Aquino’s false statements obstructed a grand jury investigation being conducted in the District of New Jersey.

The charge of obstruction carries a maximum penalty of 10 years in prison and a fine of $250,000, or twice the gross amount of any pecuniary gain that any persons derived from the offense, or twice the gross amount of any pecuniary loss sustained by any victims of the offense, whichever is greatest.

U.S. Attorney Sellinger credited special agents and task force officers of the Internal Revenue Service – Criminal Investigation, under the direction of Special Agent in Charge Tammy Tomlins in Newark; special agents and task force officers of the U.S. Drug Enforcement Administration, under the direction of Special Agent in Charge Denise Foster in San Juan, Puerto Rico; and special agents of the Federal Deposit Insurance Corporation – Office of Inspector General, New York Division, under the direction of Special Agent in Charge Patricia Tarasca with the investigation leading to the charges. He also thanked the U.S. Attorney’s Office for the Southern District of Florida; U.S. Customs and Border Protection in Atlanta, Georgia; Internal Revenue Service – Criminal Investigation in Miami, Florida; Federal Deposit Insurance Corporation – Office of Inspector General, South Florida Division; U.S. Drug Enforcement Administration in Miami, Florida; and U.S. Customs and Border Protection in Miami and Fort Lauderdale, Florida for their assistance with the investigation.

The government is represented by Assistant U.S. Attorney Marko Pesce of the Economic Crimes Unit in Newark and Trial Attorneys D. Zachary Adams, Chad Davis, and Chelsea Rooney of the Justice Department’s Money Laundering and Asset Recovery Section.

The charge and allegations contained in the complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.

 

aquino.complaint.pdf

NEWARK, N.J. – A pharmaceutical manufacturer based in Puerto Rico entered into a settlement agreement with the United States resolving allegations that the company violated the False Claims Act by taking a loan from the Paycheck Protection Program (PPP) to which the company was not entitled, U.S. Attorney Philip Sellinger announced today.

According to the allegations in the complaint and the contentions of the United States in the settlement agreement:

On March 4, 2021, Caribe Holdings Cayman Co. Ltd. (Caribe) applied for a PPP loan totaling $1.2 million. The company certified that it was eligible to receive a PPP loan and specifically that it was not an “an entity created in or organized under the laws of the People’s Republic of China” and that no such entity owned or held 20 percent or more of the economic interest in Caribe. That certification was not true at the time Caribe submitted the application and Caribe would not have qualified for the PPP loan if it answered the question accurately. After receiving the PPP loan, Caribe sought and received forgiveness of the total amount of the loan.

“The Paycheck Protection Program was just one of several efforts by the United States to help companies and people through the COVID-19 pandemic. Unfortunately, too many entities saw these programs as opportunities to line their pockets with money to which they weren’t entitled. Our office is always on the lookout to find anyone who has tried to take advantage of programs like this, and ensure that they are held accountable for taking taxpayer money that they weren’t entitled to.”

U.S. Attorney Philip R. Sellinger

Congress created the PPP in March 2020, as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, to provide emergency financial support to the millions of Americans suffering the economic effects caused by the COVID-19 pandemic. The CARES Act authorized billions of dollars in forgivable loans to small businesses struggling to pay employees and other business expenses.

Caribe fully cooperated in the investigation and resolution of this matter. In accordance with the terms of the settlement agreement, Caribe has paid the United States $1.99 million. The settlement resolves a lawsuit filed under the whistleblower provision of the False Claims Act, which permits private parties, called relators, to file suit on behalf of the United States for false claims and share in a portion of the government’s recovery. In this matter, the relator is receiving $199,103 as his share in the recovery.

The government is represented by Assistant U.S. Attorney David V. Simunovich of the Health Care Fraud Unit in Newark.

Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.

The qui tam case is captioned United States ex rel. GNGH2, Inc. v. PuraCap International LLC, et al., Civil Action No. 23-2068 (D.N.J.).

 

caribe.settlement.pdf

CAMDEN, N.J. – A former manager of a telecommunications company from Burlington County, New Jersey, admitted swapping the Subscriber Identity Module (SIM) numbers of cell phone customers into mobile devices controlled by another individual, who was paying the former manager for the unauthorized swaps, Attorney for the United States Vikas Khanna announced today.

Jonathan Katz, aka “Luna,” 42, of Marlton, New Jersey, pleaded guilty before Chief U.S. District Judge Renée Marie Bumb in Camden federal court on March 12, 2024, to an information charging Katz with conspiracy to gain unauthorized access to a protected computer.

According to documents filed in this case and statements made in court:

In May 2021, Katz was employed as a manager at a telecommunications store and accessed several customer accounts by using managerial credentials. Katz swapped the SIM numbers associated with the customers’ phone numbers into mobile devices controlled by another individual, enabling this other individual to control the customers’ phones and access the customers’ electronic accounts – including email, social media, and cryptocurrency accounts. In exchange for the swaps, Katz was paid in Bitcoin, which was traced back to Katz’s cryptocurrency account.

The conspiracy to gain unauthorized access to a computer offense carries a statutory maximum of five years in prison and a fine of not more than $250,000 or twice the pecuniary gain to the defendant or twice the gross loss involved, whichever is greater. Sentencing is scheduled for July 16, 2024.

Attorney for the United States Khanna credited special agents of the FBI, under the direction of Special Agent in Charge James E. Dennehy in Newark, with the investigation leading to the guilty plea. 

The government is represented by Assistant U.S. Attorney Dong Joo Lee of the U.S. Attorney’s Cybercrime Unit.

 

katz.information.pdf

CAMDEN, N.J. – A former Atlantic City councilman today admitted falsifying voter registrations, U.S. Attorney Philip R. Sellinger announced.

MD Hossain Morshed, 50, a former councilman of Atlantic City’s Fourth Ward, pleaded guilty today before Chief U.S. District Judge Renée Marie Bumb in Camden federal court to an information charging him with fraudulent procurement and submission of voter registration applications.

“This defendant admitted that he attempted to deprive residents of New Jersey of a fair election by obtaining false voter registration applications and facilitating their submission. Working with our law enforcement partners, we were able to uncover Morshed’s efforts to garner votes from residents who were not allowed to vote for him. We are committed to investigating and prosecuting those who unlawfully attempt to compromise the integrity of our elections.”

U.S. Attorney Philip R. Sellinger

“When you sign up to serve in public office, you are, and should be, held to a higher standard. Morshed admits he knowingly committed voter fraud, and then directed others to lie about it,” FBI – Newark Special Agent in Charge James E. Dennehy said. “Our voting processes and electoral functions are the bedrock of our democracy, and even a single elected official breaking to law in the hopes of returning to power creates cracks in the foundation. We must do all we can as law enforcement to protect our fundamental structure.”

According to documents filed in this case and statements made in court:

In April 2019, in advance of the June 2019 primary election, Morshed gave a prospective voter a New Jersey voter registration application that had already been filled out and which falsely asserted that the prospective voter had a residential address in the Fourth Ward (in Atlantic City), the ward that Morshed represented on the Atlantic City Council. Even though the address written on the form was not where the voter actually lived, Morshed urged the prospective voter to sign the application. Subsequently, Morshed visited the prospective voter at the voter’s actual residence and presented the prospective voter with a vote-by-mail application to sign which included the same false Fourth Ward Atlantic City address that was on the voter registration application and listed yet another false Atlantic City address for where the mail-in ballot should be sent to the voter. 

The Atlantic County Superintendent of Elections subsequently received the falsified voter registration application that Morshed had the prospective voter sign and thereafter, the Atlantic County Board of Elections received the prospective voter’s completed mail-in ballot, and that ballot was counted towards the June 2019 primary election. The prospective voter later admitted that the voter did not receive, complete, or return the mail-in ballot. During lawfully recorded conversations between this voter and Morshed concerning possible questioning by law enforcement, Morshed directed the voter, if questioned by law enforcement, to make false representations about where the voter lived and who filled out the voter forms that Morshed had given to the voter. Sentencing is scheduled for July 16, 2024.

U.S. Attorney Sellinger credited special agents of the FBI, under the direction of Special Agent in Charge Dennehy; the FBI’s Newark, Atlantic City Resident Agency’s Public Corruption Task Force, including the Atlantic County Prosecutor's Office, under the direction of Prosecutor William Reynolds; the Atlantic City Police Department, under the direction of Officer-in-Charge Chief James A. Sarkos; the New Jersey State Police, under the direction of Col. Patrick J. Callahan; and the Cape May County Prosecutor's Office, under the direction of Prosecutor Jeffrey H. Sutherland; as well as special agents of the U.S. Department of Labor, Office of Inspector General, Northeast Region, under the direction of Special Agent in Charge Jonathan Mellone; and postal inspectors of the U.S. States Postal Inspection Service, Philadelphia Division, under the direction of Inspector in Charge Christopher A. Nielsen, with the investigation leading to today’s guilty plea.

The government is represented by Assistant U.S. Attorney Eric A. Boden, Attorney-in-Charge of the Trenton Branch Office and Assistant U.S. Attorney James H. Graham of the Organized Crime/Gangs Unit, under the supervision of the Special Prosecutions Division.

 

morshed.information.pdf

NEWARK, N.J. – U.S. Attorney Philip R. Sellinger announced today that Executive Assistant U.S. Attorney Lee M. Cortes Jr. is leaving the office for private practice after a 14-year career in the District of New Jersey, during which he served in a variety of key roles and made immense contributions to the cause of justice.

Cortes, who came to the office in 2010, oversaw the office’s Health Care Fraud Unit and was deputy chief of the Special Prosecutions Division before taking over as Executive U.S. Attorney. He also worked as a line attorney in the office, trying several federal criminal trials, as well as investigating and taking guilty pleas in some of the office’s most significant matters.

“Lee Cortes is one of the finest attorneys to have worked at the U.S. Attorney’s Office. He has worked on and supervised some of our most complex and important matters and has always conducted himself in the highest traditions of the office. As Executive Assistant U.S. Attorney, Lee has been part of my core management team, overseeing a staff of more than 300 as we work together every day to keep New Jersey safe. In his 14 years with the office, Lee has set a standard of excellence that serves as a model for all of our Assistant U.S. Attorneys.”

U.S. Attorney Philip R. Sellinger

While serving as chief of the Health Care Fraud Unit, Cortes supervised a dozen Assistant U.S. Attorneys and directed criminal and civil investigations and prosecutions of corporations, executives, doctors, pharmacies, and others for health care-related offenses. These included health care fraud and violations of the Anti-Kickback Statute, the Federal Food, Drug, and Cosmetic Act, and the Foreign Corrupt Practices Act. He also directed the unit’s qui tam practice and supervised health care-related False Claims Act actions.

As deputy chief of the Special Prosecutions Division, Cortes supervised a dozen federal prosecutors handing public corruption matters, including prosecutions for civil rights violations.

“As a prosecutor, Lee has always acted with integrity, demonstrated an unwavering commitment to fairness, and worked extraordinarily hard to ensure just outcomes,” U.S. Attorney Sellinger said. “His achievements will be remembered, and his presence will be missed.”

CAMDEN, N.J. – A Camden County, New Jersey, businessman admitted filing false tax returns that failed to report all of his income, U.S. Attorney Philip R. Sellinger announced today.

Anthony Cardellia, 59, of Blackwood, New Jersey, pleaded guilty before U.S. District Judge Christine P. O’Hearn in Camden federal court on March 12, 2024, to an information charging him with one count of making and subscribing a false income tax return.

According to documents filed in this case and statements made in court:

Barreras owned, operated, and worked at home improvement contractors in the Philadelphia metropolitan area. Cardellia admitted that during 2016 and 2017, he used a commercial check casher to negotiate over $1.9 million of revenue checks for the home improvement businesses at which he worked. Cardellia kept about $190,000 of the cash proceeds, which he failed to report as income on his individual income tax returns. Cardellia admitted that he caused a tax loss of more than $45,000. 

The count of making and subscribing a false tax return carries a maximum penalty of three years in prison and a fine of up to $250,000. Sentencing is scheduled for July 18, 2024.

U.S. Attorney Sellinger credited special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Tammy Tomlins, with the investigation leading to the guilty plea.

The government is represented by Assistant U.S. Attorney Jeffrey Bender of the U.S. Attorney’s Office in Camden.

 

cardellia.information.pdf

NEWARK, N.J. – An Essex County man has been arrested on drug and weapons charges, U.S. Attorney Philip R. Sellinger announced today.

William Elliot, 42, of Newark, is charged by complaint with one count of possession of a firearm by a convicted felon, one count of possession with intent to distribute fentanyl and cocaine, and one count of possession of a firearm in furtherance of a drug trafficking crime. He appeared before U.S. Magistrate Judge André M. Espinosa in Newark federal court on March 7, 2024, and was detained.

According to documents filed in this case and statements made in court:

On March 6, 2024, law enforcement officers responded to Elliot’s residence and executed lawful searches of his residence and two vehicles, recovering over 40 grams of fentanyl labeled “GMA” and “SRT,” over 300 grams of cocaine, ammunition, and a Ruger Model P94 .40 caliber firearm.

The count of being a felon in possession of a weapon is punishable by a maximum of 10 years in prison and a fine of $250,000, or twice the gross gain or loss from the offense, whichever is greatest; the count of possession with intent to distribute fentanyl and cocaine is punishable by a statutory minimum of five years in prison, a maximum of 40 years in prison and a fine of $5 million, or twice the gross gain or loss, whichever is greatest. The count of possession of a firearm in furtherance of a drug crime in punishable by a mandatory minimum of five years in prison, a maximum of live in prison, and a fine of $250,000, or twice the gross gain or loss from the offense, whichever is greatest.

The charges carry a mandatory minimum prison sentence of 10 years.

U.S. Attorney Sellinger credited special agents and task force officers of the Bureau of Alcohol, Tobacco, Firearms and Explosives, Newark Field Division, under the direction of Special Agent in Charge Bryan Miller; and the Jersey City Police Department Intelligence Unit, under the direction of Public Safety Director James Shea, with the investigation leading to the charges.

This investigation was conducted as part of the Jersey City Violent Crime Initiative (VCI). The VCI was formed in 2018 by the U.S. Attorney’s Office for the District of New Jersey, the Hudson County Prosecutor’s Office, and the Jersey City Police Department, for the sole purpose of combatting violent crime in and around Jersey City. As part of this partnership, federal, state, county, and city agencies collaborate to strategize and prioritize the prosecution of violent offenders who endanger the safety of the community. The VCI is composed of the U.S. Attorney’s Office, the FBI, the ATF, the Drug Enforcement Administration, the U.S. Marshals, the Jersey City Police Department, the Hudson County Prosecutor’s Office, the Hudson County Sheriff’s Office, New Jersey State Parole, the Hudson County Jail, and the New Jersey State Police Regional Operations and Intelligence Center/Real Time Crime Center.

The government is represented by Assistant U.S. Attorney Megan Linares of the Organized Crime/Gang Unit in Newark.

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

 

elliot.complaint.pdf

NEWARK, N.J. – A California man was charged today with possession with intent to distribute fentanyl, U.S. Attorney Philip R. Sellinger announced.

Timothy Alan Blank, 54, of California is charged by complaint with one count of knowingly and intentionally possessing with the intent to distribute a quantity of a mixture and substance containing a detectable amount of fentanyl in Bergen County, New Jersey, and elsewhere. He appeared before U.S. Magistrate Judge Michael A. Hammer in Newark federal court and was detained.

According to documents filed in this case and statements made in court:

On March 3, 2024, Blank traveled in an SUV from Los Angeles, California, to the District of New Jersey with approximately 5 kilograms of fentanyl inside of the vehicle. On March 8, 2024, New Jersey state law enforcement observed Blank commit a motor vehicle violation, and upon stopping the vehicle and conducting an inspection, located the narcotics within the trunk of the SUV.

The fentanyl count carries a maximum penalty of 20 years in prison and a $1 million fine. 

U.S. Attorney Sellinger credited special agents of Homeland Security Investigations Newark, under the direction of Acting Special Agent in Charge Michael Alfonso, with the investigation leading to the charge. He also thanked the Bergen County Sheriff’s Office, the Fort Lee Police Department and the U.S. Customs and Border Protection Air and Marine Operations.

The government is represented by Assistant U.S. Vincent D. Romano of the U.S. Attorney’s Narcotics/Organized Crime Drug Enforcement Task Force (OCDETF) Unit in Newark.

The charge and allegations contained in the complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.

 

blank.complaint.pdf

NEWARK, NJ. – A Monmouth County, New Jersey, man who owned and operated a purported investment firm was arrested today and charged with engaging in a decades-long scheme to defraud at least 30 victims of more than $5 million, U.S. Attorney Philip R. Sellinger announced today.

Vincent Dispoto Jr., 66, of Belmar, New Jersey, is charged by complaint with one count of wire fraud. He is scheduled to have his initial appearance this afternoon before U.S. Magistrate Judge André M. Espinosa in Newark federal court.

According to documents filed in the case and statements made in court:

Dispoto owned and operated Giddeon Financial Services, a purported investment services firm, and Liberty Mortgage Services, an alleged mortgage company. Beginning in 1988, Dispoto raised money through these and other entities by falsely claiming to victims, many of whom were elderly, that he would invest their money in low-risk investment products with guaranteed rates of return, including municipal bonds and certificates of deposits. Dispoto also told some victims that he was using their investments to fund loans and mortgages for medical professionals, which would generate long-term returns through interest payments. To perpetuate his fraud, Dispoto mailed victims false and fraudulent financial statements that purported to show significant increases in the value of their investments.

In reality, Dispoto did not invest the victims’ money as promised. Instead, he used it to make Ponzi-like payments to other victims, which he falsely claimed to be “returns” on investments. He also misappropriated victim money to fund his gambling and other personal expenses. Dispoto’s scheme collectively resulted in more than $5 million in losses to victims.    

The wire fraud charge carries a maximum penalty of 20 years in prison and a $250,000 fine, or twice the gross amount of gain or loss from the offense, whichever is greatest.

U.S. Attorney Sellinger credited special agents of the FBI, under the direction of Special Agent in Charge James E. Dennehy in Newark, with the investigation leading to today’s arrest. 

The government is represented by Assistant U.S. Attorneys Jennifer Kozar of the U.S. Attorney’s Office Economic Crimes Unit in Newark.

The charge and allegations contained in the complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.

 

dispoto.complaint.pdf

NEWARK, N.J. – A member of the Rollin’ 60s Neighborhood Crips gang was sentenced today to 84 months in prison for his role a racketeering conspiracy, U.S. Attorney Philip R. Sellinger announced today.

Amir Edmonds, aka “G Baby,” 22, of Newark, pleaded guilty on Sept. 13, 2023, before U.S. District Judge Susan D. Wigenton to a superseding indictment that charged him with Racketeer Influenced and Corrupt Organizations (RICO) conspiracy, possession with intent to distribute fentanyl and cocaine and possessing a firearm in furtherance of a drug trafficking crime. Judge Wigenton imposed the sentence today in Newark federal court.

According to documents filed in this case and statements made in court:

From 2015 through Sept. 22, 2022, Edmonds was a member of the Rollin’ 60s Neighborhood Crips, a criminal enterprise responsible for acts of violence and the distribution of controlled substances in the District of New Jersey and elsewhere. Edmonds previously admitted to working with at least one other member of the enterprise to distribute controlled substances. On Jan. 7, 2020, Edmonds possessed with intent to distribute cocaine and fentanyl, and possessed a firearm in furtherance of that drug offense.

In addition to the prison term, Judge Wigenton sentenced Edmonds to four years of supervised release.

U.S. Attorney Sellinger credited special agents of the Drug Enforcement Administration,  under the direction of Special Agent in Charge Cheryl Ortiz; special agents of IRS – Criminal Investigation, under the direction of Special Agent in Charge Tammy Tomlins, and special agents of the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the direction of Special Agent in Charge Bryan Miller; investigators of the U.S. Marshals Service, under the direction of Marshal Juan Mattos; the Irvington Police Department, under the direction of Police Division Director Tracy Bowers; the Essex County Prosecutor’s Office, under the direction of Acting Prosecutor Theodore N. Stephens II; the Newark Police Department, under the direction of Public Safety Director Fritz Fragé; the Bloomfield Police Department, under the direction of Director of Public Safety Samuel A. DeMaio; the Essex County Sheriff’s Office, under the direction of Sheriff Armando B. Fontoura; the East Orange Police Department, under the direction of Chief Phyllis L. Bindi; the Elizabeth Police Department, under the direction of Police Director Earl J. Graves; the Edison Police Department, under the direction of Chief of Police Tom Bryan; the New Jersey State Police, under the direction of Col. Patrick J. Callahan; the Union County Prosecutor’s Office, under the direction of Prosecutor William A. Daniel; the Spotswood Police Department, under the direction of Chief Philip Corbisiero; and the North Carolina State Bureau of Investigation Fugitive and Missing Person Task Force, which includes members of the FBI, with the investigations leading to the charges in the Rollin 60’s Neighborhood Crips investigation.

This case is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.

The government is represented by Assistant U.S. Attorney Francesca Liquori of the Special Prosecutions Division.

NEWARK, N.J. – A Union County, New Jersey, man was sentenced today to 41 months in prison for his role in a conspiracy to steal and transport across state lines luxury cars stolen from towns in New York, Connecticut, and New Jersey, U.S. Attorney Philip Sellinger announced.

Malik Baker, 30, of Vauxhall, New Jersey, previously pleaded guilty before U.S. District Judge Esther Salas to an information charging him with one count of conspiring to transport stolen vehicles in interstate commerce and one count of receiving a stolen vehicle that had crossed state lines after being stolen. Judge Salas imposed the sentence today in Newark federal court.

Baker’s conspirators – Hakeem Smith, Nafique Goodwyn, and Bilal Cureton – previously pleaded guilty to related charges. Smith was sentenced on April 25, 2023, to 41 months in prison. Goodwyn was sentenced on Feb. 27, 2024, to time served. Cureton is awaiting sentencing.

According to documents filed in this case and statements made in court:

Since as early as July 2019, the defendants and others stole and conspired to steal at least 10 luxury cars from towns in New York, Connecticut, and New Jersey, and hid those cars at a location in Irvington, New Jersey. The cars include a 2019 BMW X4 M40i, stolen from Greenwich, Connecticut, on July 19, 2019; a 2017 BMW Alpina, stolen from Hewlett Bay Park, New York, on July 22, 2019; a 2017 Maserati GranTurismo, stolen from Manalapan, New Jersey, on Aug. 5, 2019; a 2018 Range Rover and a 2019 Porsche Cayenne, stolen from New City, New York, on Aug. 6, 2019; a 2017 Mercedes S550 and a 2019 Rolls Royce, stolen from Hewlett Bay Park, New York, on Aug. 13, 2019; a 2019 Land Rover, stolen from Kensington, New York, on Aug. 22, 2019; a 2019 Mercedes Maybach, stolen from Quogue, New York, on Aug. 29, 2019; a 2014 Lexus GS, stolen from West Long Branch, New Jersey, on Aug. 29, 2019; a 2017 BMW M4, stolen from Marlton, New Jersey, on Sept. 7, 2019; and a 2017 Mercedes AMG S63, stolen from Orangeburg, New York, in September 2019.

The defendants often used the stolen cars to steal more cars, and, in one instance, they used a Maserati GranTurisimo they stole from Manalapan to steal a Range Rover and a Porsche Cayenne. When law enforcement attempted to conduct a stop of the Maserati, the Maserati accelerated and crashed head-on into a police vehicle before the suspects fled the scene in another stolen vehicle. Law enforcement recovered one of the stolen cars in a shipping container at the port in Newark en route to Ghana, Africa. 

In addition to the prison term, Judge Salas sentenced Baker to three years of supervised release.

U.S. Attorney Sellinger credited special agents of the FBI, under the direction of Special Agent in Charge James E. Dennehy in Newark, and the Newark Police Department, under the direction of Public Safety Director Fritz G. Fragé. He also thanked officers with the Irvington Township Police Department, under the direction of Director Tracy Bowers; the Clarkstown Police Department, under the direction of Chief Jeffrey Wanamaker; the Wall Township Police Department, under the direction of Chief Sean O’Halloran; the Marlboro Township Police Department, under the direction of Chief Peter Pezzullo; the Tewksbury Township Police Department, under the direction of Chief Tim Barlow; the Port Authority Police Department, under the direction of Superintendent Edward Cetnar; the New Jersey State Police, under the direction of Col. Patrick J. Callahan; the Hunterdon County Prosecutor’s Office, under the direction of Prosecutor Renée M. Robeson. He also thanked officers with Customs and Border Protection, New York Field Office, under the direction of Director of Field Operations Francis J. Russo; special agents of Homeland Security Investigations Newark, under the direction of Acting Special Agent in Charge Robert Kurtz; and the Department of Commerce-Office of Export Enforcement, under the direction of Special Agent in Charge Jonathan Carson in New York, with the investigation leading to the charges.

This investigation is part of the Violent Crime Initiative (VCI) in Newark. The VCI was formed in August 2017 by the U.S. Attorney’s Office for the District of New Jersey, the Essex County Prosecutor’s Office, and the City of Newark’s Department of Public Safety to combat violent crime in and around Newark. As part of this partnership, federal, state, county, and city agencies collaborate and pool resources to prosecute violent offenders who endanger the safety of the community. The VCI is composed of the U.S. Attorney’s Office, the FBI, the ATF, the DEA New Jersey Division, the U.S. Marshals, the Newark Department of Public Safety, the Essex County Prosecutor’s Office, the Essex County Sheriff’s Office, N.J. State Board of Parole, Union County Jail, N.J. State Police Regional Operations and Intelligence Center/Real Time Crime Center, N.J. Department of Corrections, the East Orange Police Department, and the Irvington Police Department.

The government is represented by Assistant U.S. Attorney Christopher Amore, Chief of the General Crimes Unit.

NEWARK, N.J. – A New York acupuncturist today admitted participating in a $9 million health care fraud scheme to defraud Amtrak, U.S. Attorney Philip R. Sellinger announced.

Punson Figueroa, aka “Susie,” 57, of Long Island City, New York, pleaded guilty before U.S. District Judge Madeline Cox Arleo in Newark federal court to an information charging her with conspiracy to commit health care fraud.

“This defendant has admitted to fleecing the health care system for millions of dollars in illicit claims,” U.S. Attorney Sellinger said. “Submitting fraudulent claims to steal money harms the public and the health care system. My office and our partners are committed to stopping health care scams and ensure that guilty participants are punished.”

“We remain fully committed to bringing justice to those who target Amtrak’s health care plans, including Amtrak employees who wrongly accept payments for the use of their insurance information to further such schemes,” said Amtrak’s Inspector General, Kevin H. Winters. “We hope this case serves as a deterrent for health care providers and Amtrak employees who may choose to engage in such schemes, and we ask anyone who suspects or observes such fraud to report it to our fraud, waste, and abuse hotline.”

“This investigation unveiled the mastermind behind a $9 million health care fraud scheme,” DEA – New York Special Agent in Charge Frank Tarentino said. “I applaud our law enforcement partners whose diligent work put an end to this conspiracy and brought Punson Figueroa to justice to face the consequences of her illegal actions.” 

“This case demonstrates Amtrak’s resolve to work alongside all our law enforcement partners to investigate and hold accountable those who attempt to defraud the system,” Chief Sam Dotson said. “We are grateful for the collaborative law enforcement effort that led to this guilty plea, and we will continue to be vigilant in safeguarding Amtrak’s assets.”

According to documents filed in this case and statements made in court:

From January 2019 through June 2022, Figueroa and her conspirators agreed to engage in a scheme to bill the Amtrak health care plan for fraudulent claims for services that never were provided and were medically unnecessary. Figueroa recruited Amtrak employees to participate in the scheme by paying them cash in return for allowing her to use their personal and insurance information to submit false and fraudulent claims. Figueroa conspired with dozens of Amtrak employees and paid hundreds of thousands of dollars in cash kickbacks to Amtrak employees over the course of the scheme. 

On June 16, 2021, an undercover law enforcement agent posing as an Amtrak employee met with Figueroa at Figueroa’s office in New York. Figueroa instructed the undercover agent to sign his name about 30 times for services received and instructed the undercover agent not to date the signatures. Figueroa caused false claims to be submitted to Amtrak’s health care plan indicating that the undercover agent had visited providers at least seven times in May 2021, purportedly receiving acupuncture and physical therapy services.

The undercover agent visited Figueroa’s office on only one other occasion, on July 29, 2021. At this meeting, Figueroa handed the undercover agent an envelope filled with $1,000. Thereafter, Figueroa continued to use the undercover agent’s personal and insurance information to submit dozens of fraudulent claims to the Amtrak health care plan.

In total, Figueroa caused Amtrak to pay out over $9 million in false and fraudulent insurance claims.

The charge of conspiracy to commit health care fraud carries a maximum potential penalty of 10 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense, whichever is greatest. Sentencing is scheduled for July 16, 2024.

U.S. Attorney Sellinger credited special agents of the Amtrak Office of Inspector General, under the direction of Special Agent in Charge Michael J. Waters, special agents of the Drug Enforcement Administration, under the direction of Special Agent in Charge Frank A. Tarentino III in New York, and the Amtrak Police Department, under the direction of Chief of Police Sam Dotson, with the investigation leading to today’s guilty plea.

The government is represented by Assistant U.S. Attorneys Katherine M. Romano and Jessica R. Ecker of the Health Care Fraud Unit in Newark.

 

figueroa.information.pdf

NEWARK, N.J. – A New York acupuncturist today admitted participating in a $9 million health care fraud scheme to defraud Amtrak, U.S. Attorney Philip R. Sellinger announced.

Punson Figueroa, aka “Susie,” 57, of Long Island City, New York, pleaded guilty before U.S. District Judge Madeline Cox Arleo in Newark federal court to an information charging her with conspiracy to commit health care fraud.

“This defendant has admitted to fleecing the health care system for millions of dollars in illicit claims. Submitting fraudulent claims to steal money harms the public and the health care system. My office and our partners are committed to stopping health care scams and ensure that guilty participants are punished.”

U.S. Attorney Philip R. Sellinger

“We remain fully committed to bringing justice to those who target Amtrak’s health care plans, including Amtrak employees who wrongly accept payments for the use of their insurance information to further such schemes,” said Amtrak’s Inspector General, Kevin H. Winters. “We hope this case serves as a deterrent for health care providers and Amtrak employees who may choose to engage in such schemes, and we ask anyone who suspects or observes such fraud to report it to our fraud, waste, and abuse hotline.”

“This investigation unveiled the mastermind behind a $9 million health care fraud scheme,” DEA – New York Special Agent in Charge Frank Tarentino said. “I applaud our law enforcement partners whose diligent work put an end to this conspiracy and brought Punson Figueroa to justice to face the consequences of her illegal actions.” 

“This case demonstrates Amtrak’s resolve to work alongside all our law enforcement partners to investigate and hold accountable those who attempt to defraud the system,” Chief Sam Dotson said. “We are grateful for the collaborative law enforcement effort that led to this guilty plea, and we will continue to be vigilant in safeguarding Amtrak’s assets.”

According to documents filed in this case and statements made in court:

From January 2019 through June 2022, Figueroa and her conspirators agreed to engage in a scheme to bill the Amtrak health care plan for fraudulent claims for services that never were provided and were medically unnecessary. Figueroa recruited Amtrak employees to participate in the scheme by paying them cash in return for allowing her to use their personal and insurance information to submit false and fraudulent claims. Figueroa conspired with dozens of Amtrak employees and paid hundreds of thousands of dollars in cash kickbacks to Amtrak employees over the course of the scheme. 

On June 16, 2021, an undercover law enforcement agent posing as an Amtrak employee met with Figueroa at Figueroa’s office in New York. Figueroa instructed the undercover agent to sign his name about 30 times for services received and instructed the undercover agent not to date the signatures. Figueroa caused false claims to be submitted to Amtrak’s health care plan indicating that the undercover agent had visited providers at least seven times in May 2021, purportedly receiving acupuncture and physical therapy services.

The undercover agent visited Figueroa’s office on only one other occasion, on July 29, 2021. At this meeting, Figueroa handed the undercover agent an envelope filled with $1,000. Thereafter, Figueroa continued to use the undercover agent’s personal and insurance information to submit dozens of fraudulent claims to the Amtrak health care plan.

In total, Figueroa caused Amtrak to pay out over $9 million in false and fraudulent insurance claims.

The charge of conspiracy to commit health care fraud carries a maximum potential penalty of 10 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense, whichever is greatest. Sentencing is scheduled for July 16, 2024.

U.S. Attorney Sellinger credited special agents of the Amtrak Office of Inspector General, under the direction of Special Agent in Charge Michael J. Waters, special agents of the Drug Enforcement Administration, under the direction of Special Agent in Charge Frank A. Tarentino III in New York, and the Amtrak Police Department, under the direction of Chief of Police Sam Dotson, with the investigation leading to today’s guilty plea.

The government is represented by Assistant U.S. Attorneys Katherine M. Romano and Jessica R. Ecker of the Health Care Fraud Unit in Newark.

 

figueroa.information.pdf

NEWARK, N.J. – A Sussex County, New Jersey, man admitted distributing videos and images of child sexual abuse, U.S. Attorney Philip R. Sellinger announced today.

Gaetano Lapegna, 65, of Franklin, New Jersey pleaded guilty on March 5, 2024, before U.S. District Judge Claire C. Cecchi in Newark federal court to an information charging him with one count of distribution of child pornography.

According to documents filed in this case and statements made in court:

From December 2022 to March 2023, Lapegna distributed videos and images of child sexual abuse via a publicly available online peer-to-peer (P2P) file-sharing program. During the course of the investigation, an undercover law enforcement officer conducted online sessions using the P2P program, during which a user shared hundreds of videos and images of child sexual abuse from an IP address traced to Lapegna’s address.

Subsequent to a lawful search of his residence on March 30, 2023, law enforcement officers recovered over 100 items depicting child pornography on Lapegna’s thumb drive. Law enforcement also found that Lapegna’s computer was running the same version of the P2P program from which law enforcement downloaded child pornography from Lapegna.

The count of distribution of child pornography carries a mandatory minimum penalty of five years in prison, a maximum penalty of 20 years in prison and a fine of $250,000.  Sentencing is scheduled for July 23, 2024.

U.S. Attorney Sellinger credited special agents of Homeland Security Investigations Newark, under the direction of Acting Special Agent in Charge Michael Alfonso, with the investigation leading to the guilty plea. He also thanked the U.S. Postal Inspection Service, Sussex County Prosecutor’s Office, and Franklin Borough Police Department for their assistance.

The government is represented by Assistant U.S. Attorney Farhana C. Melo of the U.S. Attorney’s Office’s Criminal Division in Newark.

 

lapegna.information.pdf

NEWARK, N.J. – A Passaic County, New Jersey, man today admitted transporting and possessing videos and images of child sexual abuse, U.S. Attorney Philip R. Sellinger announced.

Edward M. O’Hagan, 50, of Hawthorne, New Jersey, pleaded guilty before U.S. District Judge Madeline Cox Arleo in Newark federal court one count of transportation of child pornography and one count of possession of child pornography. 

According to documents filed in this case and statements made in court:

Law enforcement officials learned that on Jan. 19, 2023, O’Hagan transmitted video files containing images of child sexual abuse through the internet. O’Hagan’s email addresses utilized an encrypted file storage platform to upload and create files containing images of child sexual abuse, which was accessed from an IP address at O’Hagan’s address. Subsequent to a lawful search of O’Hagan’s residence on May 22, 2023, law enforcement officers recovered hundreds of images and videos depicting child sexual abuse on O’Hagan’s electronic devices. 

The count of transportation of child pornography carries a mandatory minimum penalty of five years in prison, a maximum penalty of 20 years in prison, and a fine of $250,000. The count of possession of child pornography carries a maximum penalty of 10 years in prison and a fine of $250,000. Sentencing is scheduled for July 18, 2024.

U.S. Attorney Sellinger credited the Newark Child Exploitation and Human Trafficking Task force, under the direction of FBI Special Agent in Charge James E. Dennehy in Newark, with the investigation leading to today’s guilty plea. He also thanked the Hawthorne Police Department and the Passaic County Sheriff’s Office.

The government is represented by Assistant U.S. Attorney Farhana C. Melo of the U.S. Attorney’s Office’s Criminal Division in Newark.

 

ohagan.information.pdf

CAMDEN, N.J. – An Essex County woman was convicted for possession with intent to distribute cocaine and methamphetamine, U.S. Attorney Philip R. Sellinger announced today. 

Mahogany Hawkins, 32, of Newark, was convicted on one count possession with intent to distribute cocaine and methamphetamine.

According to documents filed in this case and the evidence at trial:

In March 2021, two FedEx parcels addressed to “John Brown” in Newark were lawfully intercepted by law enforcement and found to contain cocaine. On March 15, 2021, an undercover officer delivered the packages to the addressee, and a woman – later identified as Hawkins – answered the door and accepted the packages. Officers again knocked on Hawkins’s door, this time identifying themselves as law enforcement. Hawkins said she was “getting dressed” but didn’t open the door. The officers forced entry and found Hawkins standing in the bedroom.

After obtaining a search warrant, the officers searched Hawkins’s apartment and entered a backroom – locked by a keypad – that was a workstation for packaging narcotics. The two FedEx packages from the controlled delivery were found inside a garbage can in the backroom, and the room also contained methamphetamine pills, two plastic bags containing additional cocaine, numerous empty vials used for packaging narcotics, and a heat sealer. Laboratory analysis confirmed substances were cocaine and methamphetamine. Officers also found a loaded handgun and an extended magazine. 

The possession with intent to distribute count of which Hawkins was convicted carries a maximum potential penalty of 20 years imprisonment, and a $250,000 fine.

U.S. Attorney Sellinger credited special agents of Homeland Security Investigations Newark, under the direction of Acting Special Agent in Charge Michael Alfonso; U.S. Customs and Border Protection officers, under the direction of Port Director TenaVel Thomas, Port of New York/Newark; and members of the Newark Department of Public Safety, under the direction of Director Fritz Fragé, with the investigation leading to the conviction. He also thanked the Drug Enforcement Administration, under the direction of Special Agent in Charge Cheryl Ortiz Ortiz, and the FBI, under the direction of Special Agent in Charge James E. Dennehy in Newark.

The government is represented by Assistant U.S. Attorneys Rebecca A. Sussman and Jake A. Nasar of the U.S. Attorney’s Office’s Criminal Division in Newark.

NEWARK, N.J. – An Essex County, New Jersey, man was charged for allegedly inducing two minors to send him sexually explicit videos via text message and possessing child pornography, U.S. Attorney Philip R. Sellinger announced today.

Abdur-Razzaaq Henderson, 26, of East Orange, New Jersey, is charged by complaint with two counts of producing child pornography and one count of possessing child pornography.  Henderson appeared this afternoon before U.S. Magistrate Judge André M. Espinosa and was released on $100,000 unsecured bond.

According to documents filed in this case and statements made in court:

In April 2023, Henderson communicated via text message with a minor victim located outside of New Jersey. At Henderson’s request, the minor victim created and sent Henderson via text messages videos of the victim engaging in sexually explicit conduct. 

In July 2023, Henderson communicated via text message with another minor victim located outside of New Jersey. At Henderson’s request, the second minor victim created and sent Henderson via text messages videos of the victim engaging in sexually explicit conduct.  Henderson then engaged the second minor victim in a conversation about sexually assaulting a younger sibling.

On March 5, 2024, Henderson was found with a cell phone that contained multiple videos depicting child sexual abuse material. 

The production of child pornography charges are each punishable by a mandatory minimum penalty of 15 years in prison and a maximum potential penalty of 30 years in prison and a $250,000 fine. The child pornography possession charge is punishable by up to 10 years in prison and a $250,000 fine. 

U.S. Attorney Sellinger credited the Newark Child Exploitation and Human Trafficking Task force, under the direction of FBI Special Agent in Charge James E. Dennehy, with the investigation leading to the arrest.

The government is represented by Assistant U.S. Attorneys Rebecca Sussman and Eli Jacobs of the Criminal Division in Newark.

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

 

henderson.complaint.pdf

NEWARK, N.J. – A dual U.S. and Greek national was charged for a multimillion-dollar bank fraud conspiracy, U.S. Attorney Philip R. Sellinger announced today.

Dino Koutsogiannis, 57, of Fairview, New Jersey, is charged by complaint with one count of conspiracy to commit bank fraud. Koutsogiannis made his initial appearance on March 4, 2024, before U.S. Magistrate Judge André M. Espinosa in Newark federal court and was detained.

According to documents filed in this case and statements made in court:

From July 2022 to July 2023, Koutsogiannis and others conspired to defraud multiple financial institutions by conducting a “bust-out” debit card conspiracy. As part of the scheme, Koustogiannis and his conspirators would create shell companies and open bank accounts in those companies’ names. Koustogiannis and the conspirators would then fund those accounts with nominal funds. Then, after a few months with no activity, Koutsogiannis and the conspirators would fund the accounts via transfers from external sources, including accounts controlled by Koustogiannis and the conspirators. Several weeks later, Koutsogiannis and the conspirators would make very large debit purchases over the course of several days from those accounts, causing those accounts to accrue significantly negative balances, frequently in the amount of hundreds of thousands of dollars.

After the bust-out was complete and the accounts were left in significant negative balances, the victim financial institutions would then close the accounts. But Koutsogiannis and his conspirators would nevertheless continue executing the scheme with bank accounts at other financial institutions. Koustigannis and the conspirators executed this scheme numerous times at six victim financial institutions between July 2022 and July 2023, causing those institutions approximately $2.8 million in losses.

The charge carries a maximum penalty of 30 years and a fine of up to $1 million.

U.S. Attorney Sellinger credited special agents of Homeland Security Investigations Newark, under the direction of Acting Special Agent in Charge Michael Alfonso, with the investigation leading to the charges. He also thanked the Springfield Police Department, the Teaneck Police Department, and the New Jersey State Police.

The government is represented by Assistant U.S. Attorney Chana Y. Zuckier of the General Crimes Unit in Newark.

The charge and allegations contained in the complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.

 

koutsogiannis.complaint.pdf

NEWARK, N.J. – A federal grand jury returned an indictment charging two brothers with conspiring to distribute and possessing with intent to distribute 49 kilograms of cocaine, U.S. Attorney Philip R. Sellinger announced today.

Nelson Santos Munoz, 30, and his brother, Amauris Santos Munoz, 31, both of Miami, Florida, are charged by indictment with one count of conspiracy to distribute and possess with intent to distribute cocaine and one count of possession with intent to distribute cocaine. The Santos Brothers appeared on March 5, 2024, before U.S. District Judge Zahid N. Quraishi in Trenton federal court. They were charged by criminal complaint in May 2023. 

According to documents filed in this case and statements made in court:

On Jan. 26, 2023, law enforcement stopped a vehicle in Woodbridge, New Jersey, with three individuals, including the Santos brothers. During a search of the vehicle, law enforcement discovered approximately 49 kilograms of suspected cocaine, individually wrapped in packages with cellphone/plastic wrap in several suitcases and a backpack. A review of cell phone communications revealed that the Santos brothers traveled to the Dominican Republic and conspired to purchase cocaine and transport it to the United States for distribution. After importing the cocaine into the United States, the Santos brothers traveled from Florida to New Jersey with the intent to distribute the cocaine.

Each count carries a mandatory minimum penalty of 10 years in prison, a maximum potential penalty of life imprisonment, and a maximum fine of $10 million.

U.S. Attorney Sellinger credited members of the Drug Enforcement Administration, under the direction of Special Agent in Charge Cheryl Ortiz, New Jersey Division, with the investigation leading to the charges. He also thanked the Woodbridge Police Department for its  assistance.

The government is represented by Assistant U.S. Attorney Farhana C. Melo of the OCDETF/Narcotics Unit in Newark.

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

 

santosmunoz.indictment.pdf

TRENTON, N.J. – A Florida man admitted his role in a durable medical equipment kickback scheme, U.S. Attorney Philip R. Sellinger announced today.

Steve Chicoye, 55, of Orlando, Florida, pleaded guilty on Feb. 29, 2024, before U.S. District Judge Michael A. Shipp in Trenton federal court to an information charging him with one count of conspiracy to commit health care fraud.

According to documents filed in the case and statements made in court:

Chicoye and his conspirators solicited and received kickbacks and bribes in exchange for providing durable medical equipment (DME) companies with completed doctors’ orders for medically unnecessary DME, such as orthotic braces. Chicoye and his conspirators utilized the service of telemedicine companies to obtain these prescriptions for DME, and the DME orders were subsequently fraudulently billed to Medicare and other health care benefit programs.

Chicoye and his conspirators were paid approximately $2.1 million in kickbacks for these DME orders and caused losses to Medicare and other health care benefit programs of at least $3.6 million.

The charge of conspiracy to commit health care fraud is punishable by a maximum potential penalty of 10 years in prison and a fine of $250,000, or twice the gross profit or loss caused by the offense, whichever is greatest.  Sentencing is scheduled for Aug. 6, 2024.

U.S. Attorney Sellinger credited special agents of the FBI, under the direction of Special Agent in Charge James E. Dennehy in Newark; the Department of Health and Human Services-Office of Inspector General, under the direction of Special Agent in Charge Naomi Gruchacz; and the U.S. Department of Veterans Affairs Office of Inspector General, under the direction of Special Agent in Charge Christopher F. Algieri, with the investigation leading to the guilty plea.

The government is represented by Assistant U.S. Attorney DeNae Thomas of the Health Care Fraud Unit in Newark.

 

chicoye.information.pdf

NEWARK, N.J. – Five Passaic County, New Jersey, residents were charged with the armed robbery of a residence in Saddle Brook, New Jersey, U.S. Attorney Philip R. Sellinger announced today.

Jamere Dixon, aka “Rebels,” 23; Jahad Foxworth, aka “Hadie,” 25; Tyra Jones, 24; Jancarlos Rodriguez, aka “M’s,” 23; and Lanasia Smith, aka “Lay,” 24, all of Paterson, New Jersey, are charged by complaint with one count of conspiracy to commit Hobbs Act robbery and one count of conspiracy to use and carry a firearm during and in relation to a crime of violence. The defendants appeared on Feb. 28, 2024, before U.S. Magistrate Judge André M. Espinosa in Newark federal court. Dixon, Foxworth, and Rodriguez were detained. Jones and Smith were each released on $100,000 unsecured bond.

According to documents filed in this case and statements made in court:

In the early morning hours of June 28, 2022, Foxworth, Rodriguez, and Dixon entered a residence in Saddle Brook and held two victims at gunpoint. The three defendants stole money, credit cards, and suspected controlled substances, among other items. Prior to the robbery, Smith was a guest at the residence and provided Foxworth, Rodriguez, and Dixon with access to the home by leaving the front door unlocked. The investigation revealed that hours before the robbery Smith sent to Rodriguez a picture of a safe located in the residence. After the robbery, the suspects fled in a vehicle driven by Jones. Rodriguez, Jones, and Smith were later seen on surveillance footage attempting to use the stolen credit cards at gas stations and a convenience store in Paterson.

The conspiracy to commit Hobbs Act robbery and conspiracy to use and carry a firearm during and in relation to a crime of violence counts each carry a maximum potential penalty of 20 years in prison, a fine of up to $250,000, or twice the gain or loss from the offense, whichever is greatest.

U.S. Attorney Sellinger credited special agents of the Bureau of Alcohol, Tobacco, Firearms and Explosives, Newark Field Division, under the direction of Special Agent in Charge Bryan Miller; the Passaic County Sheriff’s Office, under the direction of Acting Sheriff Gary Giardina; the Bergen County Prosecutor’s Office, under the direction of Acting Chief Matthew Finck, the New Jersey State Police, under the direction of Col. Patrick J. Callahan; and the Saddle Brook Police Department, under the direction of Officer in Charge Captain John A. Zotollo Jr.; and with the investigation leading to the charges.

This case is part of the Violent Crime Initiative (VCI), which was formed in 2020 by the U.S. Attorney’s Office for the District of New Jersey, the Passaic County Prosecutor’s Office, and the City of Paterson’s Department of Public Safety for the purpose of combatting violent crime in and around Paterson. As part of this partnership, federal, state, county, and city agencies collaborate and pool resources to prosecute violent offenders who endanger the safety of the community. The VCI is composed of the U.S. Attorney’s Office, the FBI, the ATF, the Drug Enforcement Administration, the U.S. Marshals, the Paterson Department of Public Safety, the Paterson Police Department, the Passaic County Prosecutor’s Office, the Passaic County Sheriff’s Office, N.J. State Parole, Passaic County Jail, N.J. State Police Regional Operations and Intelligence Center/Real Time Crime Center, and N.J. Department of Corrections.

The government is represented by Assistant U.S. Attorneys Jake A. Nasar of the Organized Crime and Gangs Unit and Farhana C. Melo of the OCDETF/Narcotics Unit in Newark.

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

 

rodriguezetal.complaint.pdf

TRENTON, N.J. – A Bucks County, Pennsylvania, man made his initial appearance on charges of producing videos and images depicting child sexual abuse and coercing and enticing a minor to engage in criminal sexual conduct, U.S. Attorney Philip R. Sellinger announced today.

Gregory J. Barger, 38, of Morrisville, Pennsylvania, was indicted on Feb. 15, 2024, on one count of sexual exploitation of a child – production of child pornography – and one count of coercion and enticement – online enticement of a minor. Barger had previously been charged by criminal complaint with the production offense. Barger was arraigned on Feb. 28, 2024, before U.S. District Judge Michael A. Shipp in Trenton federal court and was detained pending trial.

According to documents filed in this case and statements made in court:

From Aug. 5, 2020, through April 7, 2022, Barger – a previously convicted, registered sex offender – used an electronic messaging application to communicate with a minor victim located in the United Kingdom. He induced, enticed, and coerced the minor victim to engage in sexual conduct with Barger. In February 2022, Barger traveled to the United Kingdom and produced images and videos of Barger engaged in sexual conduct with the minor victim. Law enforcement later recovered those images and videos from Barger’s cellular phone, which was seized from Barger at the time of his arrest on April 7, 2022, in Hamilton, New Jersey. 

Because of Barger’s prior conviction, the charge of production of child pornography carries a mandatory minimum penalty of 25 years in prison and a maximum potential penalty of 50 years in prison, as well as a $250,000 fine. The charge of online enticement of a minor carries a mandatory minimum penalty of 10 years in prison and a maximum potential penalty of life in prison, as well as a $250,000 fine.

U.S. Attorney Sellinger credited special agents of Homeland Security Investigations Newark, under the direction of Acting Special Agent in Charge Michael Alfonso, and members of the Mercer County Prosecutor’s Office, under the direction of Prosecutor Angelo J. Onofri, with the investigation leading to the charges.

The government is represented by Assistant U.S. Attorney Alexander E. Ramey of the U.S. Attorney’s Office Criminal Division in Trenton.

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

 

barger.indictment.pdf

United States Attorney Susan Lehr announced that Shawn David Johnson, 40, of Omaha, Nebraska, was sentenced February 28, 2024, in federal court in Omaha for being a felon in possession of a firearm. United States District Court Judge Brian C. Buescher sentenced Johnson to 18 months’ imprisonment. There is no parole in the federal system. After Johnson’s release from prison, he will begin a 2-year term of supervised release.

On February 1, 2022, a cooperating witness working with law enforcement purchased a 9mm handgun with a 6-round capacity magazine from Johnson inside of his Omaha residence. At the time, Johnson was a convicted felon. Law enforcement has since determined that the handgun had been shipped in interstate commerce prior to the transaction.

This case was investigated by the Bureau of Alcohol, Tobacco and Firearms.

 

NEWARK, N.J. – The shadow chief executive officer of National Realty Investment Advisors LLC (NRIA) today admitted orchestrating a scheme to defraud more than 2,000 investors in a $658 million Ponzi scheme and conspiring to evade millions of dollars in tax liabilities, U.S. Attorney Philip R. Sellinger announced.

Thomas Nicholas Salzano, aka “Nicholas Salzano,” 65, of Secaucus, New Jersey, pleaded guilty before U.S. District Judge Evelyn Padin in Newark federal court to securities fraud, conspiracy to commit wire fraud, and conspiracy to defraud the United States. Salzano admitted he made numerous misrepresentations to investors while he secretly ran NRIA behind the scenes. He also admitted to misappropriating millions of dollars from investors to enrich himself and his family and friends. 

“For years, Salzano told lie after lie to investors, continuously deceived them, and operated his business as a Ponzi scheme, through which he stole money from thousands of investors. His greed and flagrant disregard for the law caused staggering losses in excess of $650 million. This office will continue to prioritize prosecuting individuals, like Salzano, to ensure that those who engage in rampant fraud are punished with long jail sentences and are ordered to make their victims whole.”

U.S. Attorney Philip R. Sellinger

“Many people who decide to invest have to put a lot of faith in so-called financial experts, hoping their money grows and doesn’t one day disappear,” FBI – Newark Special Agent in Charge James E. Dennehy said. “Salzano admits he played a role in a scam that cost investors $658 million. History has shown over and over and over again, Ponzi schemes don't ever pay out, yet criminals keep trying to beat the system. FBI Newark and our law enforcement partners are doing all we can to help the victims in this case. We want others who may have faced a similar situation to contact us so we can help you as well.”

“Salzano not only victimized thousands of investors, but he also defrauded honest taxpayers by concealing his income from the IRS and evading his tax liability to the tune of millions of dollars,” IRS – Criminal Investigation Special Agent in Charge Harry T. Chavis Jr., Boston Field Office, said. “Today’s guilty plea by Salzano demonstrates how IRS – Criminal Investigation will continue to use their financial expertise to identify and investigate these types of investor fraud schemes with our law enforcement partners.”

As part of his plea agreement, Salzano has agreed to a prison term of eight to 12 years, a forfeiture money judgment in the amount of $8.52 million, and he has agreed to pay full restitution of $507.4 million to the victims of his offenses.

According to documents filed in this case and statements made in court:

From February 2018 through January 2022, Salzano and others defrauded investors and potential investors of NRIA Partners Portfolio Fund I LLC (the “Fund”), a real estate fund operated by NRIA, of $650 million through lies, deception, misleading statements, and material omissions. These included the financial position of NRIA, the manner in which the defendants and their conspirators used Fund investor money, and Salzano’s managerial role at NRIA and his history of fraud.

The defendants executed their scheme through an aggressive multiyear, nationwide marketing campaign that involved thousands of emails to investors; advertisements on billboards, television, and radio; and meetings and presentations to investors. Salzano led and directed the marketing campaign, which employed deception, material misrepresentations and omissions, and falsified documents to manipulate investors, which were intended to mislead Fund investors into believing that NRIA was a solvent business that generated significant profits. In reality, NRIA generated little to no profits and operated as a Ponzi scheme, which was kept afloat by new investors. Despite investing almost none of their own capital into the business, the defendants misappropriated millions of dollars of investor money to support their lavish lifestyles, including expensive dinners, extravagant birthday parties, and payments to family and associates who did not work at NRIA.

Salzano concealed his true managerial role at NRIA in an effort to avoid scrutiny from investors of Salzano’s history of fraud at a large telecommunications company. In addition to defrauding investors, Salzano orchestrated a separate conspiracy to obstruct, impede, and impair the IRS in its effort to collect millions of dollars in outstanding taxes Salzano owed to the U.S. Treasury by, among other things, lying to the IRS, using a web of nominees, opening bank accounts in the names of phony entities, and using false and fraudulent company documents. 

Conspiring to defraud the United States carries a maximum penalty of five years in prison and a $250,000 fine. The securities fraud count and the wire fraud conspiracy count are both punishable by a maximum penalty of 20 years in prison and a $250,000 fine. Pursuant to the terms of his plea agreement, the maximum prison term that can be imposed on Salzano is 12 years. Sentencing is scheduled for Aug. 6, 2024.

U.S. Attorney Sellinger credited special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Chavis in Boston; and special agents of the FBI, under the direction of Special Agent in Charge Dennehy in Newark, with the investigation, with assistance from FBI Headquarters Criminal Investigative Division and the Department of Justice Tax Division.

The government is represented by Assistant U.S. Attorneys Jonathan Fayer, Lauren E. Repole, and John Mezzanotte, all of the U.S. Attorney’s Office’s Criminal Division, with assistance from Trial Attorney Samuel B. Bean of the U.S. Department of Justice, Tax Division.

 

salzano.indictment.pdf

NEWARK, N.J. – An India- and New Jersey-based man who operated jewelry companies in New York City’s Diamond District was charged with spearheading a scheme to illegally evade customs duties for millions of dollars of jewelry imports into the United States and with illegally processing millions of dollars through unlicensed money transmitting businesses, U.S. Attorney Philip R. Sellinger announced today.

Monishkumar Kirankumar Doshi Shah, aka “Monish Doshi Shah,” 39, of Mumbai, India, and Jersey City, New Jersey, was charged by complaint with one count of conspiracy to commit wire fraud and one count of operating and aiding and abetting the operation of an unlicensed money transmitting business. He was arrested over the weekend and appeared appear on Feb. 26, 2024, before U.S. Magistrate Judge André M. Espinosa in Newark federal court. Shah was released on $100,000 bond, with home detention and location monitoring.

According to documents filed in this case and statements made in court:

From January 2015 through September 2023, Shah engaged in a scheme to evade duties for shipments of jewelry from Turkey and India to the United States. Shah would ship or instruct his conspirators to ship goods from Turkey or India – which would have been subject to an approximately 5.5 percent duty if shipped directly to the United States – to one of Shah’s companies in South Korea. Shah’s conspirators in South Korea would change the labels on the jewelry to state that they were from South Korea instead of Turkey or India, and then ship them to Shah or his customers in the United States, thereby unlawfully evading the duty. Shah would also make and instruct his customers to make fake invoices and packing lists to make it look like Shah’s South Korean companies were actually ordering jewelry from Turkey or India. During the scheme, Shah shipped millions of dollars of jewelry from South Korea to the United States.

From July 2020 through November 2021, Shah operated numerous purported jewelry companies in New York City’s Diamond District, including MKore LLC (MKore), MKore USA Inc. (MKore USA), and Vruman Corp. (Vruman). Shah used these entities to conduct millions of dollars in illegal financial transactions for customers – including converting cash to checks or wire transfers. Shah would also collect cash from customers and use conspirators’ jewelry companies, which were also located in the Diamond District, to convert the cash into wires or checks. At times, Shah and his conspirators moved more than a million dollars of cash in a single day. In exchange for their services, Shah and his conspirators charged a fee. None of Shah’s or his conspirators’ companies were registered as money transmitting businesses with New York, New Jersey, or the Financial Crimes Enforcement Network (FinCEN).

The wire fraud conspiracy charge is punishable by a maximum of 20 years in prison. The charge of operating and aiding and abetting the operation of an illegal money transmitting business carries a maximum penalty of five years in prison. Each count is also punishable by a maximum fine of either $250,000 or twice the gain or loss from the offense, whichever is greatest.

U.S. Attorney Sellinger credited special agents and task force officers of IRS - Criminal Investigation, under the direction of Special Agent in Charge Tammy Tomlins in Newark; special agents with Homeland Security Investigations New York, under the direction of Acting Special Agent in Charge Erin Keegan; special agents of Homeland Security Investigations Newark, under the direction of Acting Special Agent in Charge Michael Alfonso; and officers with U.S. Customs and Border Protection at the Port of New York/Newark, under the direction of Port Director TenaVel Thomas, with the investigation leading to the charges. He also thanked U.S. Customs and Border Protection in New York; Homeland Security Investigations in Seoul, South Korea; the Korea Customs Service in South Korea; the Seoul Customs Special Investigation Office in South Korea; the U.S. Drug Enforcement Administration in Paterson; the Parsippany-Troy Hills Police Department; the Morristown Police Department; the Federal Deposit Insurance Corporation – Office of Inspector General; and the Justice Department’s Money Laundering and Asset Recovery Section (MLARS) for their assistance in the investigation.

The government is represented by Assistant U.S. Attorneys Marko Pesce and Olta Bejleri of the Economic Crimes Unit in Newark, with assistance from William Kanellis of the Department of Justice Trade Fraud Task Force.

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

 

shah.complaint.pdf

NEWARK, N.J. – A Bergen County, New Jersey, woman today admitted to tax evasion, to helping her clients file falsified tax returns that generated larger refunds, and to filing false declarations on quarterly tax returns for her tax return preparation business, U.S. Attorney Philip R. Sellinger announced.

Joshlyn Raye, 49, of Elmwood Park, New Jersey, pleaded guilty before U.S. District Judge Esther Salas in Newark federal court to an information charging her with one count of aiding and assisting in the preparation of a false and fraudulent tax return; one count of tax evasion; and one count of filing a false declaration under penalty of perjury concerning a quarterly tax return on behalf of her tax return business.

According to documents filed in this case and statements made in court:

From March 2010 to September 2023, Raye was the owner of JB Tax Services, a tax return preparation business in Hackensack, New Jersey. She knowingly and willfully evaded her personal income taxes over three of those years; filed 50 false tax returns on behalf of her clients; and filed three false quarterly employment tax returns on behalf of her tax return preparation business. Raye used fabricated and inflated figures, including expenses and itemized deductions.

The counts of aiding or assisting in the preparation of a false income tax return and filing a false declaration under penalty of perjury each carry a maximum penalty of three years in prison and a $250,000 fine. The count of tax evasion carries a maximum penalty of five years in prison and a $250,000 fine. As part of her plea agreement, Raye has agreed to pay the government restitution of $676,168, and to file amended tax returns. Sentencing is scheduled for Aug. 6, 2024. 

U.S. Attorney Sellinger credited special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Tammy Tomlins, with the investigation leading to today’s guilty plea.

The government is represented by Assistant U.S. Attorney Benjamin Levin of the National Security Unit in Newark.

 

NEWARK, N.J. – A California man was arraigned today on charges relating to his role in a fraud and kickback scheme that caused more than $10 million in losses to Medicare, Attorney for the United States Vikas Khanna announced.

Adam Wayne Owens, 43, of Riverside, California, is charged in a superseding indictment with one count of conspiracy to commit health care fraud and wire fraud and one count of conspiracy to violate the federal Anti-Kickback Statute. Owens appeared today before U.S. District Judge Michael E. Farbiarz in Newark and was released on a $500,000 unsecured bond. 

According to documents filed in the case and statements made in court:

From November 2018 to January 2020, Owens participated in a kickback and bribery scheme with testing companies and telemedicine providers, resulting in the submission of false and fraudulent claims to Medicare. Owens owned and controlled marketing companies in California through which he and his conspirators identified Medicare beneficiaries to target for at-home cancer genetic tests (CGX). Owens and his conspirators used a variety of methods to obtain personal and medical information from the Medicare beneficiaries, including making unsolicited telephone calls to elderly cancer patients. Owens and his conspirators then caused CGX testing kits to be sent to the beneficiaries regardless of whether they needed or wanted them. Once the CGX tests were completed and returned, Owens’ conspirators submitted claims for reimbursement to Medicare. In exchange for Owens’ role in the conspiracy, his companies received kickback payments ranging from $1,700 to $2,000 for each CGX test resulting in Medicare reimbursement.

To conceal the scheme, the testing companies wired various kickback payments to a shell company in New Zealand, which then wired the payments to bank accounts controlled by Owens in the United States. To further conceal the scheme, Owens entered into a sham contract with the New Zealand shell company which made it appear that one of Owens’ marketing companies was engaged in and being paid for legitimate marketing and referral services. Owens then generated invoices falsely purporting that the marketing company was providing hourly referral services for the New Zealand shell company. Instead, Owens received payments from the New Zealand shell company based solely on the number of CGX tests that Medicare reimbursed.      

Owens and his conspirators caused a loss to Medicare of more than $10 million.

Conspiracy to commit health care fraud and wire fraud is punishable by a maximum potential penalty of 20 years in prison. Conspiracy to violate the federal Anti-Kickback Statute is punishable by a maximum potential penalty of five years in prison. Each count is also punishable by a fine of $250,000, or twice the gain or loss from the offense, whichever is greatest.

Attorney for the United States Khanna credited special agents of the FBI, under the direction of Special Agent in Charge James E. Dennehy in Newark; the Department of Health and Human Services-Office of Inspector General, under the direction of Special Agent in Charge Naomi Gruchacz; the U.S. Department of Defense, Office of the Inspector General, Defense Criminal Investigative Service, under the direction of Acting Special Agent in Charge Brian J. Solecki; and the U.S. Department of Veterans Affairs Office of Inspector General, under the direction of Special Agent in Charge Christopher F. Algieri with the investigation leading to the charges.

The government is represented by Assistant U.S. Attorney Garrett J. Schuman of the Health Care Fraud Unit and Senior Trial Counsel Barbara A. Ward of the Asset Recovery and Money Laundering Unit.

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

 

owens.sindictment.pdf

NEWARK, N.J. – A Bronx, New York, man admitted his role in a kickback conspiracy involving COVID-19 testing, U.S. Attorney Philip R. Sellinger announced today.

David Weathers, 61, of Bronx, New York, pleaded guilty before U.S. District Judge Brian R. Martinotti in Newark federal court on Feb. 26, 2024, to an indictment charging him with conspiring to violate the Anti-Kickback Statute by soliciting kickbacks for the referral of COVID-19 test samples.

“The defendant in this case has admitted to seeking payments for sending COVID-19 tests to a particular lab for processing. There is no place in our health care system for illegal payments made in attempt to influence medical decisions. My office will continue to prosecute those who attempt to corrupt the health care system.”

U.S. Attorney Philip R. Sellinger

“It took fraudsters no time at all to hunt for a get rich quick scheme when the pandemic started,” FBI – Newark Special Agent in Charge James E. Dennehy said. “Weathers and his conspirators set their eyes on the federal government and the funding made available under the CARES Act. He now admits to asking a lab in New Jersey for kickbacks when he provided COVID-19 test samples, which were ultimately paid for by federal funding. Anyone who believes they will get away with their crimes as time passes should take note of this case, you will be brought to justice.”

According to documents filed in the case and statements made in court:

Weathers and his conspirators solicited kickbacks in exchange for providing COVID-19 test samples to Metpath Laboratories, a clinical laboratory located in Parsippany, New Jersey, that, among other things, conducted testing to detect the presence of COVID-19 in samples obtained from individual patients. Metpath paid kickbacks for the referrals of COVID-19 test samples and subsequently billed Medicare and other health care benefit programs for the tests, causing a loss of more than $3.5 million to federal programs.

The charge of conspiracy to violate the Anti-Kickback Statute is punishable by a maximum potential penalty of five years in prison and a fine of $250,000, or twice the gross profit or loss caused by the offense, whichever is greatest.  Sentencing is scheduled for July 10, 2024.

U.S. Attorney Sellinger credited special agents of the FBI, under the direction of Special Agent in Charge James E. Dennehy in Newark, with the investigation leading to the guilty plea.

The government is represented by Assistant U.S. Attorney DeNae Thomas of the Health Care Fraud Unit in Newark.

 

weathers.indictment.pdf

NEWARK, N.J. – A Bergen County, New Jersey, man who collected millions of dollars in fees from victims seeking funding for their commercial projects that he misappropriated in part for his personal benefit while failing to secure the promised financing was indicted, U.S. Attorney Philip R. Sellinger announced today.

Jeffrey Kahn, 55, of Ridgewood, New Jersey, is charged with six counts of wire fraud and one count of money laundering. Kahn was previously charged by complaint with two counts of wire fraud for the same scheme in November 2021.  

According to documents filed in this case and statements made in court:

From March 2018 through March 2020, Kahn devised a plan to defraud multiple victims of millions of dollars that were paid at Kahn’s direction to various accounts – including bank accounts in the name of Kahn’s financial advisory firm, Kahn Advisors, LLC – and characterized by Kahn as insurance premium payments, advance fees or taxes, in exchange for a promise of financing, including through an individual and a lender. To induce victims to pay money to Kahn, Kahn misrepresented to certain victims that he had conducted multiple successful financial transactions through the individual and the lender. Kahn continued to vouch for the individual, even after Kahn received information that there was a strong likelihood that the individual, who claimed to have an office in Teaneck, New Jersey, but who is instead believed to reside abroad and to have used an alias in his dealings with Kahn – was not a legitimate lender.  Kahn also caused others to make misrepresentations to certain victims regarding their purported successful financing deals with Kahn and/or the individual. In reality, Kahn never obtained any financing from the individual or the lender for the victims.

Kahn further misrepresented to certain victims that the money they sent to Kahn and  Kahn Advisors would continue to be held upon receipt until the victims provided their consent to the release of the funds. Instead, Kahn caused the victims’ funds to be transferred to other accounts, including bank accounts that Kahn controlled, without the victims’ prior consent, and then used portions of those amounts to pay for Kahn’s personal expenses and to pay back other victims.

As a result of the scheme, Kahn caused the victims to transfer more than $5 million in funds to accounts controlled by Kahn or provided to Kahn by the individual. Kahn misappropriated approximately $800,000 of those funds for his own personal benefit, and used an additional portion of those funds – approximately $447,000 – to pay back other victims of the scheme.

Each wire fraud count is punishable by a maximum of 20 years in prison and a fine of $250,000, or twice the gross amount of gain or loss from the offense, whichever is greater. The count of money laundering carries a maximum potential penalty of 10 years in prison and a $250,000 fine, or twice the gross gain to the defendant or gross loss to the victim, whichever is greatest.

U.S. Attorney Sellinger credited special agents of the FBI, under the direction of Special Agent in Charge James E. Dennehy in Newark, with the investigation leading to the indictment.

The government is represented by Assistant U.S. Attorney Jennifer S. Kozar of the Economic Crimes Unit in Newark.

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

 

kahn.indictment.pdf

NEWARK, N.J. – A former corrections officer at Bayside State Prison in Leesburg, New Jersey, today admitted to depriving two inmates of their civil rights by failing to intervene when the inmates were being assaulted and suffered bodily injury, U.S. Attorney Philip R. Sellinger announced.

Joshua Hand, 34, of Millville, New Jersey, pleaded guilty before U.S. District Judge Karen M. Williams in Camden federal court to an information charging him with depriving two inmates of their right not to be subjected to cruel and unusual punishment.

According to documents filed in this case and statements made in court:

In December 2019, while working as a corrections officer, Hand was inside the officers’ quarters within the kitchen area of Bayside State Prison when the first victim was summoned to that room. Shortly after that victim entered the officer’s quarters, the exit door was blocked and in the presence of Hand, the victim was assaulted simultaneously by several inmates and taken down to the floor. Hand watched and did not attempt to intervene when multiple inmates pinned and restrained the victim on the floor while other inmates delivered multiple punches and other blows to the victim’s torso, arms, and legs. Hand did not report this assault to his supervisors or medical personnel despite knowing that he was required to do so. 

Later that day, a second victim was in the officers’ quarters at the prison with Hand and another corrections officer. Without provocation, the other corrections officer struck the second victim in the legs multiple times with a broomstick. During the assault of second victim, Hand remained within arm’s reach of the assault and had a reasonable opportunity to intervene but did not attempt to do so. Once again, Hand did not report this assault to his supervisors or medical personnel. 

Violating the civil rights of others carries a maximum sentence of 10 years in prison and a maximum potential fine of the greater of $250,000, twice the gross amount of pecuniary gain that any person derived from the offense, or twice the gross amount of pecuniary loss that any person suffered from the offense, whichever is greatest. Sentencing is scheduled for July 2, 2024.

U.S. Attorney Sellinger credited special agents of the FBI Atlantic City Resident Agency, under the direction of Special Agent in Charge James E. Dennehy in Newark, with the investigation. He also thanked the New Jersey Department of Corrections, under the direction of Commissioner Victoria Kuhn, for its assistance in the investigation.

The government is represented by Assistant U.S. Attorney Thomas S. Kearney of the Special Prosecutions Division in Newark.

 

hand.information.pdf

NEWARK, N.J. – A member of the Rollin’ 60s Neighborhood Crips gang admitted to his role in a racketeering conspiracy and to possessing firearms and ammunition as a convicted felon, U.S. Attorney Philip R. Sellinger announced today.

Amir Warden, aka “Stamps,” aka “Killa,” 31, pleaded guilty on Feb. 22, 2024, before U.S. District Judge Susan D. Wigenton in Newark federal court to two counts of a superseding information that charged him with Racketeer Influenced and Corrupt Organizations (RICO) conspiracy and possession of firearms and ammunition by a convicted felon.

According to documents filed in this case and statements made in court:

From 2015 through Sept. 22, 2022, Warden was a member of the Rollin’ 60s Neighborhood Crips, a criminal enterprise responsible for acts of violence and the distribution of controlled substances in the District of New Jersey and elsewhere. Warden held a leadership role within the enterprise and conspired with other members and associates to distribute controlled substances. On Aug. 19, 2019, he distributed heroin. On Sept. 29, 2022, Warden, a convicted felon, knowingly possessed three loaded firearms, three high-capacity drum magazines, and approximately 1,300 rounds of assorted ammunition.

Warden faces a maximum sentence of 20 years in prison and a fine of up to $250,000 on the racketeering conspiracy and a maximum sentence of 15 years in prison and a fine of up to $250,000 on the firearms charge. Sentencing is scheduled for June 25, 2024.

U.S. Attorney Sellinger credited special agents of the DEA, under the direction of Special Agent in Charge Cheryl Ortiz; special agents of IRS-Criminal Investigation, under the direction of Acting Special Agent in Charge Tammy Tomlins; and special agents of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), under the direction of Special Agent in Charge Bryan Miller, with the investigation leading to the guilty plea. He also thanked investigators of the U.S. Marshals Service, under the direction of Marshal Juan Mattos; the Irvington Police Department, under the direction of Police Division Director Tracy Bowers; the Essex County Prosecutor’s Office, under the direction of Acting Prosecutor Theodore N. Stephens II;, the Newark Police Department, under the direction of Public Safety Director Fritz Fragé; the Bloomfield Police Department, under the direction of Director of Public Safety Samuel A. DeMaio; the Essex County Sheriff’s Office, under the direction of Sheriff Armando B. Fontoura; the East Orange Police Department, under the direction of Chief Phyllis L. Bindi; the Elizabeth Police Department, under the direction of Police Director Earl J. Graves; the Edison Police Department, under the direction of Chief of Police Tom Bryan; the New Jersey State Police, under the direction of Col. Patrick J. Callahan; the Union County Prosecutor’s Office, under the direction of Prosecutor William A. Daniel; the Spotswood Police Department, under the direction of Chief Philip Corbisiero; and the North Carolina State Bureau of Investigation Fugitive and Missing Person Task Force.

This case is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.

The government is represented by Assistant U.S. Attorney Francesca Liquori of the Special Prosecutions Unit.

 

warden.sinformation.pdf