District of New Jersey

TRENTON, N.J. – A Trenton woman today admitted her role in a drug trafficking conspiracy that distributed hundreds of grams of heroin in Trenton and the surrounding area, U.S. Attorney Craig Carpenito announced.

Ileana Sanchez, a/k/a “Lilly,” a/k/a “Mami,” 34, pleaded guilty before U.S. District Judge Freda L. Wolfson in Trenton federal court to Count One of an indictment charging her with conspiracy to distribute and possess with intent to distribute 100 grams or more of heroin.

In December 2016, Sanchez and nine other members of a drug trafficking organization operating in Trenton were charged by criminal complaint with conspiracy to distribute heroin. The complaint referred to the drug trafficking organization as the “Abdullah DTO,” after its leader, Ishmael Abdullah. Sanchez is the last of the 10 defendants to plead guilty.

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

From July 2015 through December 2016, Sanchez and others participated in a drug trafficking organization that operated in the area of Spring Street and Passaic Street in Trenton.

Through the authorized interception of telephone calls and text messages, controlled purchases of heroin, the use of confidential sources of information, and other investigative means, law enforcement learned that Ishmael Abdullah was a leader of the Abdullah DTO and was responsible for obtaining significant quantities of heroin from multiple suppliers, including Sanchez and Jose Joaquin Torres-Mezquita.

Ishmael Abdullah and Keith Hunter coordinated the organization’s distribution of heroin through themselves and other conspirators. Members of the Abdullah DTO used temporary prepaid phones, stash houses and cars, and spoke in code to avoid detection by law enforcement.

The conspiracy charge to which Sanchez pleaded guilty carries a mandatory minimum sentence of five years in prison, a maximum potential sentence of 40 years in prison and a $5 million fine. Sentencing is scheduled for Oct. 24, 2018.

U.S. Attorney Carpenito credited the Greater Trenton Safe Streets Task Force, including special agents of the FBI Trenton Resident Agency, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark; special agents of the Bureau of Alcohol, Tobacco, Firearms, and Explosives, Newark Division, Trenton Satellite Office, under the direction of Special Agent in Charge John B. Devito; officers of the Trenton Police Department, under the direction of Acting Director Pedro Medina; officers of the Princeton Police Department, under the direction of Chief of Police Nicholas Sutter; officers of the Ewing Police Department, under the direction of Chief of Police John P. Stemler III; and detectives of the Mercer County Prosecutor’s Office, under the direction of Mercer County Prosecutor Angelo J. Onofri, with the investigation.

He also thanked special agents of the FBI’s Philadelphia Field Office, under the direction of Special Agent in Charge Michael Harpster; special agents of Homeland Security Investigations, under the direction of Special Agent in Charge Brian A. Michael, Newark Field Office; officers of the N.J. State Police, under the direction of Superintendent Col. Patrick J. Callahan; and officers of the Mercer County Sheriff’s Office, under the direction of Sheriff John A. Kemler, for their assistance in the case.

The government is represented by Assistant U.S. Attorney J. Brendan Day of the U.S. Attorney’s Office’s Criminal Division in Trenton.

Defense counsel: John M. Holliday Esq., Hackensack, New Jersey

NEWARK, N.J. – A Morris County, New Jersey, man today admitted his role in producing images of child sexual abuse, U.S. Attorney Craig Carpenito announced.

Colin M. Skeele, 32, of Florham Park, New Jersey, pleaded guilty before U.S. District Judge Susan D. Wigenton in Newark federal court to an information charging him with one count of producing child pornography. Skeele was previously arrested and charged by complaint on Aug. 4, 2016.

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

Skeele previously worked as a counselor at a boys’ summer camp in Hardwick, New Jersey, and as a teacher at parochial schools in Boonton, New Jersey, and Stirling, New Jersey.

In 2011, Skeele became Facebook friends with a boy that Skeele met while working as a counselor at a boys’ summer camp in Hardwick, New Jersey. In Facebook messages with the minor, Skeele offered to pay money for the minor to take sexually explicit photographs to send to Skeele. In one instance, Skeele paid the boy approximately $100 to send nude images of himself. Skeele later sent at least one pornographic image of that minor to another minor that had also attended the summer camp.

On multiple occasions in February 2012, Skeele communicated online with individuals located in the Philippines to purchase live child sexual abuse shows, which Skeele viewed via an online video chat service. Instant messages obtained during the investigation revealed that Skeele used an online fund transfer service to purchase live sexual abuse videos of young children.

Anyone with information regarding possible victims of this activity is urged to contact the Department of Homeland Security in Newark, New Jersey, at 973-776-5500.

The charge of producing child pornography to which Skeele pleaded guilty is punishable by a mandatory minimum sentence of 15 years in prison, a maximum potential penalty of 30 years in prison, and a $250,000 fine. Sentencing is scheduled for Oct. 22, 2018.

U.S. Attorney Carpenito credited special agents of U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI), under the direction of Special Agent in Charge Brian Michael, with the investigation that led to today’s guilty plea.

The government is represented by Assistant U.S. Attorney Jonathan M. Peck of the U.S. Attorney’s Criminal Division.

Defense Counsel: Jay V. Surgent, Esq., Parsippany, New Jersey

NEWARK, N.J. – Three members of the New Jersey set of the violent street gang “Grape Street Crips” – including its long-time leader – were convicted by a federal jury today of racketeering conspiracy and a host of murders, shootings, and drug trafficking crimes, U.S. Attorney Craig Carpenito, FBI Special Agent in Charge Gregory W. Ehrie and DEA Special Agent in Charge Valerie A. Nickerson announced.

The leader of the enterprise, Corey Hamlet, a/k/a “C-Blaze,” a/k/a “Blaze,” a/k/a “Blizzie,” a/k/a “Castor Troy,” 41, of Belleville, New Jersey; and associates Tony Phillips, a/k/a “Blue,” 27, of Newark; and Ahmad Manley, a/k/a “Fresh,” a/k/a “Moddi G,” 32, of Summit, New Jersey, were convicted following a two-month trial before U.S. District Judge Madeline Cox Arleo in Newark federal court. The jury deliberated for four days before returning the verdicts. (A chart outlining the counts per defendant and maximum potential penalties is attached below.)

“The jury’s verdicts are the culmination of this Office’s investigation and prosecution of more than 60 members of the Grape Street Crips, a violent criminal organization that committed murders and other acts of violence in order to maintain control of a large portion of the illegal drug trade in Newark,” U.S. Attorney Carpenito said. “Today’s convictions of Corey Hamlet, the leader of that organization, as well as two of his senior gang members, represent our steadfast, ongoing commitment to ensuring the safety of New Jersey’s citizens and the communities in which they live. We will not back down from our duty to protect the public through the investigation and prosecution of violent and dangerous criminals like Hamlet and his gang.”

 “The FBI is working jointly with county and local authorities, to include the local community, to combat the violent epidemic of gangs in our neighborhoods,” FBI Newark Special Agent in Charge Ehrie said. “In this collaborative effort in delivering the greatest impact toward restoring the community and bringing those bad seeds to justice, the Grape Street Crips, one of the most violent Newark gangs, was dismantled in this joint investigation. The gang was responsible for four murders, an attempted murder, racketeering conspiracy and drug trafficking. With the conviction of Corey Hamlet, the gang’s leader, and two of his associates, the Grape Street Crips gang will have been dealt a serious blow.”

“The members of the Grape Street Crips have wreaked havoc in the city of Newark for years by committing violent murders, shootings and drug trafficking,” DEA Special Agent in Charge Nickerson said. “Now the residents of Newark can rest easier knowing that these criminals have been convicted of these serious charges. The collaboration between the DEA and our law enforcement partners exemplified outstanding investigative efforts resulting in the successful conviction of some of Newark’s most violent criminals. These efforts will have a positive impact on our communities and the residents of this great city.”

The defendants were charged in November 2016 in a 22-count indictment charging 14 members and associates with, among other things, six murders, 12 attempted murders, and numerous other violent and drug trafficking crimes committed as part of the racketeering conspiracy. Twelve of the fourteen defendants charged in the indictment have now been convicted. The two remaining defendants, Hanee Cureton and Khalil Stafford, are pending trial.

An additional 68 members and associates of the Grape Street Crips who were arrested in a coordinated takedown in May 2015 were separately charged with drug-trafficking, physical assaults, and witness intimidation. Sixty-six of those individuals also have been convicted, and charges remain pending against two.

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

The Grape Street Crips engaged for years in numerous acts of murder, robbery, extortion, and drug trafficking throughout Newark. As the leader of the New Jersey set of the Grape Street Crips, Hamlet authorized six murders committed by members of the gang.

The trial highlighted numerous violent acts committed by Grape Street Crips members as part of the racketeering conspiracy, some of which targeted members of rival gangs and others that targeted Grape Street Crips members whom Hamlet perceived to be a threat to his position as the leader of the gang:

• June 14, 2010: The murder of Leroy Simmons;

• Dec. 23, 2010: The murder of Rodney Kearney;

• May 3, 2013: The murder of Tariq Johnson;

• Oct. 27, 2013: The attempted murders of Almalik Anderson and Saidah Goines.

• Nov. 12, 2013: The murder of Anwar West; and

• August 3, 2015: The murder of Andre Singh.

The trial revealed that Hamlet ordered many of the murders as revenge against Almalik Anderson, a rival with whom he had a long-running dispute. One of Hamlet’s fellow gang-members attempted to broker a truce with Anderson at the Short Hills Mall. After the meeting at Short Hills, Hamlet used his Instagram account to assert that Anderson had cooperated with law enforcement. On Hamlet’s orders, Phillips, Manley, and other gang-members then hunted Anderson down and sprayed his car with bullets, nearly killing him and passenger Saidah Goines, a relative. Within two weeks, Hamlet successfully ordered two other gang-members to murder Anwar West, the fellow gang-member who had attempted to broker peace between Hamlet and Anderson.

Hamlet was convicted of 10 counts in the indictment, including RICO conspiracy, murder in aid of racketeering, various other violent crimes in aid of racketeering, using firearms during crimes of violence, and conspiracy to distribute 28 grams or more of crack-cocaine. As part of the RICO conspiracy, Hamlet was convicted for his role in the murders of Tariq Johnson and Anwar West. Hamlet faces a mandatory sentence of life in prison.

Phillips was convicted of 10 counts in the indictment, including RICO conspiracy, murder in aid of racketeering, various other violent crimes in aid of racketeering, using firearms during crimes of violence, and conspiracy to distribute one kilogram or more of heroin.  Phillips, too, faces a mandatory sentence of life in prison.

Manley was convicted of eight counts in the indictment, including RICO conspiracy.  As part of the RICO conspiracy, Manley was convicted for his role in the attempted murders of Almalik Anderson and Saidah Goines. On two counts of conviction, Manley faces a maximum sentence of life in prison, including a mandatory minimum term of 15 years.

The evidence at trial also showed that members of the Grape Street Crips controlled drug-trafficking at a number of Newark public-housing complexes, including Oscar Miles, Riverview Court, Pennington Court, Wynona Lippman Gardens, Kemsco Village, John W. Hyatt housing complex, and the former Baxter Terrace public-housing complex.

Sentencing is scheduled for Oct. 15, 2018.

U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Ehrie in Newark, and special agents of the DEA, under the direction of Special Agent in Charge Nickerson with the investigation. He also thanked the Essex County Prosecutor’s Office, under the direction of Acting Prosecutor Robert D. Laurino, and the Essex County Sheriff’s Office, under the direction of Armando B. Fontura, for their long and close collaboration on the case

The case was tried by Assistant U.S. Attorneys Osmar J. Benvenuto and Barry A. Kamar of the Criminal Division and Assistant U.S. Attorney Richard J. Ramsay of the Appeals Division in Newark.

This case was conducted under the auspices of the Organized Crime Drug Enforcement Task Force (OCDETF) and the FBI’s Safe Streets Task Force, a partnership between federal, state and local law enforcement agencies. The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations and those primarily responsible for the nation’s illegal drug supply.

The charges and allegations against the remaining two defendants are merely accusations, and the defendants are considered innocent unless and until proven guilty.

Defendant

Guilty Counts/Max Penalties

Hamlet

Count 1: Racketeering Conspiracy – Life in Prison;

Count 2: Murder in Aid of Racketeering (Tariq Johnson) – Mandatory life sentence

Count 3: Use of Firearm in Violent Federal Crime (Tariq Johnson) – Life in prison; 10-year mandatory minimum

Count 4: Conspiracy to Murder in Aid of Racketeering (Almalik Anderson / Saidah Goines) – 10 years

Count 5: Attempted Murder in Aid of Racketeering (Almalik Anderson) – 10 years

Count 6: Attempted Murder in Aid of Racketeering (Saidah Goines) - 10 years

Count 7: Conspiracy to Assault with a Dangerous Weapon (Almalik Anderson / Saidah Goines) – 3 years

Count 8: Assault with a Dangerous Weapon (Almalik Anderson) – 20 years

Count 9: Assault with a Dangerous Weapon (Saidah Goines) – 20 years

Count 10: Use of Firearm in Violent Federal Crime (Almalik Anderson / Saidah Goines) – life in prison; 10-year mandatory minimum

Phillips

Count 1: Racketeering Conspiracy – Life in Prison;

Count 2: Murder in Aid of Racketeering (Tariq Johnson) – Mandatory life sentence

Count 3: Use of Firearm in Violent Federal Crime (Tariq Johnson) – Life in prison; 10-year mandatory minimum

Count 4: Conspiracy to Murder in Aid of Racketeering (Almalik Anderson / Saidah Goines) – 10 years

Count 5: Attempted Murder in Aid of Racketeering (Almalik Anderson) – 10 years

Count 6: Attempted Murder in Aid of Racketeering (Saidah Goines) - 10 years

Count 7: Conspiracy to Assault with a Dangerous Weapon (Almalik Anderson / Saidah Goines) – 3 years

Count 8: Assault with a Dangerous Weapon (Almalik Anderson) – 20 years

Count 9: Assault with a Dangerous Weapon (Saidah Goines) – 20 years

Count 10: Use of Firearm in Violent Federal Crime (Almalik Anderson / Saidah Goines) – life in prison; 10-year mandatory minimum

Manley

Count 1: Racketeering Conspiracy – Life in Prison;

Count 4: Conspiracy to Murder in Aid of Racketeering (Almalik Anderson / Saidah Goines) – 10 years

Count 5: Attempted Murder in Aid of Racketeering (Almalik Anderson) – 10 years

Count 6: Attempted Murder in Aid of Racketeering (Saidah Goines) – 10 years

Count 7: Conspiracy to Assault with a Dangerous Weapon (Almalik Anderson / Saidah Goines) – 3 years

Count 8: Assault with a Dangerous Weapon (Almalik Anderson) – 20 years

Count 9: Assault with a Dangerous Weapon (Saidah Goines) – 20 years

Count 10: Use of Firearm in Violent Federal Crime (Almalik Anderson / Saidah Goines) – life in prison; 10-year mandatory minimum

NEWARK, N.J. – A Wallington, New Jersey, man was sentenced today to 63 months in prison for purchasing live child sex shows from individuals overseas, U.S. Attorney Craig Carpenito announced.

Stephen Hallett, 67, previously pleaded guilty before U.S. District Judge Kevin McNulty to an information charging him with receipt of child pornography. Judge McNulty imposed the sentence today in Newark federal court.

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

Hallett purchased live child sex shows from individuals located in the Philippines. He admitted that on Feb. 4, 2015, he received a webcam transmission of a minor engaging in sexually explicit conduct. Hallett also admitted purchasing live webcam shows of children engaging in sexually explicit conduct on dozens of occasions between 2013 and 2015.   

In addition to the prison term, Judge McNulty sentenced Hallett to five years of supervised release and imposed a $5,000 Justice for Victims of Trafficking Act assessment.

U.S. Attorney Carpenito credited special agents of U.S. Immigration and Customs Enforcement’s (ICE), Homeland Security Investigations (HSI), under the direction of Special Agent in Charge Brian Michael in Newark, with the investigation leading to today’s sentencing.

The government is represented by Assistant U.S. Attorney Danielle Alfonzo Walsman, Co-Chief of the U.S. Attorney’s Public Protection Unit in Newark.

TRENTON, N.J. – A former employee of Tax Pro’s and Tax Solutions & Associates, tax preparation businesses located in Essex and Union counties, admitted today to conspiring to defraud the United States by filing false income tax returns, U.S. Attorney Craig Carpenito announced.

Tony V. Russell 47, of Stone Mountain, Georgia, pleaded guilty before U.S. District Judge Michael A. Shipp in Trenton federal court to Count One of an indictment charging him with conspiracy to defraud the IRS. 

Two members of the conspiracy have previously pleaded guilty to their roles in the fraud and await sentencing. Damien Askew, 39, of Union, New Jersey, pleaded guilty June 6, 2017, to conspiracy to defraud the IRS and filing a false federal personal income tax return. Rudolph Sanders, 41, of Newark, New Jersey, pleaded guilty May 10, 2018, to conspiracy to defraud the IRS.

Two other members of the conspiracy, Joseph Kenny Batts, 49, of Elkridge, Maryland, and Angelo K. Thompson, 38, of Reistertown, Maryland, were arrested April 17, 2018, on charges of conspiracy to defraud the IRS and aiding and assisting in the preparation of false federal income tax returns.

According to documents filed in this and related cases and statements made in court:

From at least 2009 to April 2015, Batts was co-owner, along with Askew, of Tax Pro’s, a tax return preparation and payroll business in Essex County, where Russell, Sanders, Batts, Thompson, and Askew prepared tax returns. To boost their business, the defendants conspired to falsify their clients’ federal income tax returns to generate refunds from the IRS in amounts that their clients were not entitled to receive. Russell, Sanders, Batts, Thompson, and Askew inflated tax refunds by fabricating and inflating credits for education and childcare; deductions, such as charitable contributions and unreimbursed employee expenses; and business losses. 

Russell and other members of the conspiracy also permitted Batts to use their Preparer Tax Identification Numbers (PTIN) – the identification number that paid tax preparers are required to place on tax returns they have prepared – when preparing tax returns to conceal Batts’ identity as the actual tax return preparer; Batts had a prior federal tax fraud conviction.

After law enforcement executed a search warrant at Tax Pro’s in April 2015, Batts discontinued Tax Pro’s and opened Tax Solutions and Associates in Union, where Russell, Thompson, and Batts continued preparing false federal income tax returns. 

By fraudulently inflating the amounts of the tax refunds, Batts, Askew, Thompson, Russell, and Sanders caused a total tax loss to the IRS of approximately $900,000.

The conspiracy charge carries a maximum potential penalty of five years in prison. The aiding and assisting in the preparation of a false return charge and the filing a false return charge both carry a maximum potential penalty of three years in prison. All offenses carry a statutory maximum fine equal to the greatest of $250,000 or twice the pecuniary gain by the defendant or loss by any victims. Russell’s sentencing is scheduled for Nov. 29, 2018. 

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

The government is represented by Assistant U.S. Attorneys Cari Fais and Jihee Suh of the Special Prosecutions Division.

The charges and allegations against Batts and Thompson are merely accusations, and the defendants are considered innocent unless and until proven guilty.

NEWARK, N.J. – The owner and manager of a New Jersey hedge fund was sentenced today to 72 months in prison for defrauding two investors of $4 million, U.S. Attorney Craig Carpenito announced.

Nicholas Lattanzio, 62, of Montclair, New Jersey, was previously convicted on all counts of an indictment charging him with two counts of wire fraud and two counts of securities fraud following a three-week trial before U.S. District Judge Kevin McNulty, who imposed the sentence today in Newark federal court. 

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

From June 2013 through November 2014, Lattanzio orchestrated a large-scale scheme through which he, his hedge fund, the Black Diamond Capital Appreciation Fund L.P. (BD Fund), and several other related entities collected millions of dollars in upfront fees from two unsuspecting corporate investors in exchange for the promise of future loans or investment opportunities that did not materialize. Instead of investing the victims’ money as promised, Lattanzio stole the majority of the funds and used them to pay himself more than $500,000 in salary. He used the money for numerous personal expenses, including the purchase of a $1 million home in Montclair, New Jersey, a new Range Rover, a $10,000 diamond ring, and the payment of $500,000 in credit card debt that he incurred for other personal expenses.  Lattanzio lied to the victims about the status of their funds to conceal the scheme and mislead them into believing that their investments were safe.

In addition to the prison term, Judge McNulty sentenced Lattanzio to three years of supervised release and ordered him to pay restitution of $3.93 million.

U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark, for the investigation leading to today’s sentencing.  He also thanked the U.S. Securities and Exchange Commission’s New York Regional Office, under the direction of Marc P. Berger, and the N.J. Bureau of Securities, within the State Attorney General’s Division of Consumer Affairs, under the direction of Attorney General Gurbir S. Grewal.

The government is represented by Assistant U.S. Attorneys Nicholas P. Grippo and Daniel V. Shapiro of the Economic Crimes Unit, and Assistant U.S. Attorney Peter Gaeta of the Office’s Asset Recovery and Money Laundering Unit.

Earlier today, in federal court in Brooklyn, Darren Goodrich, a former registered broker at a brokerage firm in El Segundo, California, was sentenced by United States District Judge Eric N. Vitaliano to 41 months’ imprisonment for one count of conspiracy to commit securities fraud for Goodrich’s participation in the manipulation of the price and trading volume of the stock of Cubed, Inc. (“Cubed”), which traded under the ticker symbol CRPT.  In a second stock fraud case that originated in the District of New Jersey, Judge Vitaliano sentenced Goodrich to 41 months’ imprisonment for one count of conspiracy to commit securities fraud for Goodrich’s participation in the manipulation of the price and trading volume of the following stocks: NXT Nutritional Holdings, Inc., which traded under the ticker symbol NXTH; Bioneutral Group, Inc., which traded under the ticker symbol BONU; Clear-Lite Holdings, Inc., which traded under the ticker symbol CLRH; and Mesa Energy Holdings, Inc., which traded under the ticker symbol MSEH (collectively, the “Target Companies”).  Goodrich pleaded guilty to the Cubed case in June 2016 and the Target Companies case in January 2017.  The sentences for both cases will run concurrently.

Richard P. Donoghue, United States Attorney for the Eastern District of New York, and William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the sentences.

“Goodrich has been held responsible for participating in schemes designed to dupe investors into believing that companies with little in the way of assets were worth hundreds of millions of dollars,” stated United States Attorney Donoghue.  “Today’s sentence sends a powerful message that this Office, together with our law enforcement partners, will hold licensed securities professionals accountable when they abuse their positions to facilitate the commission of crimes.”  Mr. Donoghue expressed his appreciation to the U.S. Attorney’s Office for the District of New Jersey, which charged Goodrich in the Target Companies scheme, and the Securities and Exchange Commission (“SEC”), New York Regional Office, for its assistance in both of these cases.

“Goodrich used his status as a step stool to help him achieve his objectives in this sly scheme, in which he manipulated various securities for an illegal million-dollar profit,” stated FBI Assistant Director-in-Charge Sweeney.  “By this activity, schemers like Goodrich continuously tarnish the reputation of trust and professionalism held to countless brokerage firms. In an effort to maintain this reputation, the FBI will be thorough in investigating and extracting the bad seeds of the financial industry.”

The Cubed Scheme

Between March 2014 and July 2014, Goodrich and his co-conspirators, including  Abraxas J. Discala, who was recently convicted at trial, engaged in a scheme to defraud investors and potential investors in Cubed, by artificially controlling the price and trading volume of shares in the company through fraudulent concealment of the co-conspirators’ ownership interests and engineering price movements and trading volume in the stock.  In March 2014, Goodrich’s co-conspirators took Cubed public through an asset purchase agreement, similar in effect to a reverse merger.  Between April 22, 2014 and July 17, 2014, Goodrich and his co-conspirators placed coordinated purchases and bids to purchase the stock to deceive investors into believing that there was more market demand for the stock at certain prices than actually existed.

Goodrich and his co-conspirators also used an escrow arrangement that initially controlled all the free-trading stock to successfully control the price and trading volume of Cubed stock.  On June 23, 2014, Cubed reached its highest closing price of $6.75 per share, resulting in a market capitalization of approximately $200 million.  Previously, on April 21, 2014, Cubed had filed with the SEC a Form 10-Q and reported less than $1,500 in cash, zero revenue, negative stockholders’ equity, a net loss of $15,000 and accrued professional fees of $131,824.   The SEC halted trading in Cubed on July 17, 2014.

The Target Companies Scheme

From 2008 through 2010, Goodrich, working with co-conspirators Nathan Montgomery and Samuel DelPresto, who both pleaded guilty in the District of New Jersey to conspiring to commit securities fraud, participated in a pump and dump scheme.  As part of the scheme, the defendants obtained control over large blocks of the free-trading shares of the Target Companies, “pumped” the price of those shares by engaging in manipulative trading of the stock and circulated promotional materials encouraging others to purchase the stock.  Thereafter, the defendants “dumped”, or sold, large volumes of the stock to victim investors.  The Target Companies’ stock price then dropped, resulting in substantial losses to the victims.  The scheme generated approximately $33 million in illicit trading proceeds for Montgomery and DelPresto.  Goodrich received approximately $1.5 million in gross trading commissions.

The government’s case is being handled by the Office’s Business and Securities Fraud Section.  Assistant United States Attorneys Shannon C. Jones, Patrick T. Hein and Mark E. Bini are in charge of the prosecution, with assistance provided by Assistant United States Attorney Claire Kedeshian of the Office’s Civil Division, which is responsible for the forfeiture of assets.   Assistant United States Attorney Nicholas P. Grippo investigated and charged Goodrich in the District of New Jersey in the Target Companies Scheme, prior to the transfer of the case to the Eastern District of New York for Goodrich’s guilty plea and sentencing.

The Defendant:

DARREN GOODRICH
Age: 39
Manhattan Beach, California

E.D.N.Y. Docket No. 14-CR-399 (ENV)
E.D.N.Y. Docket No. 16-CR-630 (ENV)
D.N.J. Docket No.  16-CR-544 (JLL)

NEWARK, N.J. – A Wilmington, Delaware, man today admitted conspiring with his father to file false federal tax returns for shell companies, resulting in approximately $241,000 in fraudulent refunds, U.S. Attorney Craig Carpenito announced.

Johnathan Crespo, 34, pleaded guilty before U.S. District Judge Jose L. Linares in Newark federal court to an information charging him with one count of conspiring with Jose Crespo to defraud the IRS by filing false corporate tax returns and cashing the resulting fraudulent refund checks.

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

Between 2011 and 2013, Johnathan Crespo and his father, Jose Crespo, filed numerous false federal corporate tax returns, IRS Forms 1120, for fake businesses, knowing that the businesses were not real and that the credits claimed on the tax returns were false. These false tax returns resulted in approximately $241,000 in fraudulent refunds being issued by the IRS.

In filing these false tax returns, Johnathan and Jose Crespo took advantage of fuel excise tax credits offered under federal tax law. The federal government taxes gasoline, diesel fuel, and certain other types of fuel, but certain commercial uses of these fuels are nontaxable. Businesses that purchase fuel for a nontaxable use can claim a tax credit by filing an IRS Form 4136, “Credit for Federal Tax Paid on Fuels.”

In one instance, Johnathan and Jose Crespo filed a federal corporate tax return for 2011 for Advanced Transportation Corp. that falsely claimed a fuel excise tax credit of $24,898 and a resulting refund of $20,767. Advanced Transportation Corp. was a shell company, and the fuel excise tax credit and other tax return numbers were false. Johnathan Crespo received and cashed the $20,767 refund check at a check-cashing facility in Guttenberg, New Jersey. He cashed many other refund checks for similar false tax returns at this same check-cashing facility.

Jose Crespo pleaded guilty on Sept. 11, 2017, before Judge Linares to engaging in the fuel excise tax credit scheme and another tax fraud scheme, which together claimed fraudulent refunds from the IRS of nearly $1.5 million. He was sentenced on Dec. 20, 2017, to three years in prison. 

Marilyn Crespo, Jose Crespo’s wife, pleaded guilty March 1, 2018, before Judge Linares to engaging in the same fuel excise tax credit scheme and causing a loss to the IRS of $286,742. Marilyn Crespo was sentenced on June 27, 2018, to 12 months and one day in prison and ordered to pay restitution of $286,742.

Johnathan Crespo’s brother, Jason Crespo, pleaded guilty June 28, 2018, before Judge Linares to engaging in the same fuel excise tax credit scheme and causing a loss to the IRS of $191,953. His sentencing is scheduled for Oct. 4, 2018. 

The count of conspiracy to defraud the IRS carries a maximum potential penalty of five years in prison and a potential fine of $250,000 or twice the gross gain or loss from the offense, whichever is greater. Johnathan Crespo’s sentencing is scheduled for Oct. 16, 2018.

U.S. Attorney Carpenito credited special agents of IRS-Criminal Investigation, under the direction of Acting Special Agent in Charge Bryant Jackson, with the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorney Rahul Agarwal, Deputy Chief of the Criminal Division in Newark.

TRENTON, N.J. – An Edison, New Jersey, man was sentenced today to 120 months in prison for his role in a conspiracy to distribute 140 kilograms of narcotics in New Jersey, U.S. Attorney Craig Carpenito announced.

Gemal Singleton, 41, previously pleaded guilty before U.S. District Judge Brian R. Martinotti to an information charging him with one count of conspiracy to possess with intent to distribute more than one kilogram of heroin and five kilograms of cocaine. Judge Martinotti imposed the sentence today in Trenton federal court.

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

Singleton, Siddeeq Q. Williams, 40, of Cranford, New Jersey, and others arranged for cocaine and heroin to be shipped to New Jersey via tractor trailer. On Aug. 27, 2017, the tractor-trailer arrived in New Jersey and was pulled over by law enforcement after the driver committed several traffic violations. 

A subsequent search of the tractor-trailer recovered five large duffle bags containing a total of 56 kilograms of heroin and 85 kilograms of cocaine. Singleton and Williams admitted that they were supposed to meet the tractor-trailer to collect the narcotics for eventual distribution.

In addition to the prison term, Judge Martinotti sentenced Singleton to five years of supervised release. Williams has also pleaded guilty to his role in the scheme and awaits sentencing.

U.S. Attorney Carpenito credited special agents with the Drug Enforcement Administration, under the direction of Special Agent in Charge Valerie A. Nickerson in Newark, with the investigation leading to today’s sentence.

The government is represented by Assistant U.S. Attorney Meredith Williams, Co-Chief of the U.S. Attorney’s Office Public Protection Unit in Newark. 

Defense counsel: Robert DeGroot Esq., Newark

TRENTON, N.J. – A Roslyn, New York, man today admitted demanding bribes in exchange for his assistance in securing contracts between a Texas financial services company and two New Jersey information technology staffing companies, U.S. Attorney Craig Carpenito announced.

Mark Berger, 58, 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 violate the Federal Travel Act.

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

From January 2011 through March 2013, Berger was the chief information officer of SWBC, a financial services company based in Texas, and had the ability and authority to hire certain companies to perform work. Berger entered into contracts between SWBC and two companies based in New Jersey, including DaVinci Technology Corp., for information technology and staffing services.

As a condition of the contracts, Berger demanded that the owner of the IT companies, Anthony Curlo, 53, of Chester, New Jersey, pay him a certain percentage of the monies that the companies would receive from SWBC.

The IT companies received approximately $3 million in revenue from SWBC. Under the terms of the illegal kickback arrangement between Berger and Curlo, Berger was supposed to receive $1.14 million in kickback payments. Berger actually received $985,000 in cash payments, which were delivered to his home in New York.

The conspiracy to violate the Federal Travel Act charge carries a maximum potential penalty of five years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. Berger also forfeited $985,000 as part of his guilty plea. Sentencing is scheduled for Oct. 10, 2018.

Curlo previously pleaded guilty to his role in the scheme on Sept. 21, 2016 and awaits sentencing.

U.S. Attorney Carpenito credited special agents of IRS–Criminal Investigation, under the direction of Acting Special Agent in Charge Bryant Jackson in Newark, with the investigation leading to today’s guilty plea.

The government is represented by Assistant U.S. Attorney Jonathan W. Romankow of the U.S. Attorney’s Office Criminal Division in Newark.

Defense counsel: John Carman Esq., Garden City, New York

Daniel K. Dxrams, 39, of Maplewood, New Jersey, was indicted today on one count of conspiracy to commit mail fraud and nine substance counts of mail fraud in connection with an alleged debt elimination scheme to unlawfully discharge his obligations for a Rolls Royce, a Bentley and two Mercedes Benz vehicles. He was originally charged by complaint with one count of conspiracy to commit mail fraud when he was arrested with four other individuals who allegedly used phony money orders, cashier’s checks, receipts and other fabricated documents to fraudulently discharge mortgages, student loans, and other financial obligations, as described in the press release of March 20, 2018.

Defendants Include a New Jersey Doctor, an Anesthesiology Technologist for a Philadelphia Hospital, and the Owner of a Medical Billing Company

NEWARK, N.J. – The largest health care fraud and opioid enforcement action ever taken by the Justice Department resulted in three guilty pleas and five arrests in New Jersey involving a South Jersey-Philadelphia drug trafficking ring that sold over 1,100 oxycodone pills and multiple individuals who used phony claims to steal millions from state and private insurers, U.S. Attorney Craig Carpenito announced today.

The national takedown targeted over 601 charged defendants across 58 federal districts, including more than 165 doctors, nurses and other licensed medical professionals, for their alleged participation in health care fraud schemes involving approximately $2 billion in false billings. Of those charged, over 162 defendants, including 76 doctors, were charged for their roles in prescribing and distributing opioids and other dangerous narcotics. Thirty state Medicaid Fraud Control Units also participated in today’s arrests. In addition, the Department of Health and Human Services (HHS) announced today that from July 2017 to the present, it has excluded 2,700 individuals from participation in Medicare, Medicaid, and all other federal health care programs, which includes 587 providers excluded for conduct related to opioid diversion and abuse.

As part of the national takedown, the New Jersey U.S. Attorney’s Office filed five separate cases this week charging four defendants with conspiracy to commit health care fraud and three defendants with conspiracy to distribute oxycodone.

Robert Agresti, 61, a doctor from Essex Fells, New Jersey, and Brian Catanzarite, 42, a former gym owner from Cedar Grove, New Jersey, pleaded guilty on June 26, 2018 to their roles in separate conspiracies to attain phony compounded medication prescriptions on behalf of companies that marketed those products. Enver Kalaba, 36, a Metropolitan Transportation Authority (MTA) bus driver from Old Bridge, New Jersey, pleaded guilty June 27, 2018 to a similar scheme targeting his employer.

Tiffany Marsh, 40, a medical billing company owner from West Orange, New Jersey, and Keasam Johnson, 34, a telecommunications company employee from East Orange, New Jersey, were arrested on June 26, 2018 for their alleged roles in a conspiracy to collect insurance reimbursements for chiropractic services that were never rendered.

Anthony Pepe III, 40, of Cherry Hill, New Jersey, an anesthesiology technologist for a Philadelphia hospital, along with Daniel Watson, 39, of Bellmawr, New Jersey, and Prussia Hing, 35, of Philadelphia, were arrested on June 26, 2018 for their alleged roles in an oxycodone distribution ring.

“At a time when many Americans worry about securing health insurance for their families, we’ve seen far too many instances where public and private insurance providers are raided for millions in phony reimbursements for compounded medications or non-existent therapy services,” U.S. Attorney Carpenito said. “On top of that, we are in the midst of an opioid crisis perpetuated by both rogue health care professionals and street-level dealers seeking to profit from the addiction of others. This national takedown seeks to address both fronts, and thanks to the efforts of our federal and local law enforcement partners right here in the New Jersey area, eight individuals will now answer for these crimes in federal court.”

“Health care fraud is a betrayal of vulnerable patients, and often it is theft from the taxpayer,” said Attorney General Jeff Sessions. “In many cases, doctors, nurses, and pharmacists take advantage of people suffering from drug addiction in order to line their pockets. These are despicable crimes. That’s why this Department of Justice has taken historic new steps to go after fraudsters, including hiring more prosecutors and leveraging the power of data analytics. Today the Department of Justice is announcing the largest health care fraud enforcement action in American history. This is the most fraud, the most defendants, and the most doctors ever charged in a single operation – and we have evidence that our ongoing work has stopped or prevented billions of dollars’ worth of fraud. I want to thank our fabulous partners with the FBI, DEA, our Health Care Fraud task forces, HHS, the Defense Criminal Investigative Service, IRS Criminal Investigation, Medicare, and especially the more than 1,000 federal, state, local, and tribal law enforcement officers from across America who made this possible. By every measure we are more effective at finding and prosecuting medical fraud than ever.”

“Every dollar recovered in this year’s operation represents not just a taxpayer’s hard-earned money – it’s a dollar that can go toward providing healthcare for Americans in need,” said HHS Secretary Alex M. Azar III. “This year’s Takedown Day is a significant accomplishment for the American people, and every public servant involved should be proud of their work.”

Agresti

Agresti admitted that from November 2014 through September 2017, he participated in a scheme to defraud health insurance plans, including New Jersey state and local employee health benefit programs, by prescribing medically unnecessary compounded prescriptions on behalf of a company that marketed those products.

Agresti was paid $300 in cash for every prescription he authorized for compounded medication, regardless of medical necessity. Agresti signed the prescriptions brought to him by other conspirators without examining or speaking with the patients. Multiple health benefit programs paid more than $8.9 million as a result of Agresti’s phony prescriptions.

“Health care fraud adversely impacts our overburdened health care system, draining valuable funds away from those in need into the greedy coffers of the conspirators,” said Special Agent in Charge Gregory W. Ehrie of the Newark FBI Field Office. “The FBI will continue to vigorously investigate these so called 'victimless crimes,' which deplete our nation's resources."

Catanzarite

Catanzarite admitted that from March 2015 through January 2017, he conspired to defraud New Jersey state benefit programs. Catanzarite was recruited by one of his former gym members to become a sales representative of a company that marketed compounded medications. The marketing company received a percentage of every prescription that its sales representatives steered toward a particular compounding pharmacy.

To maximize his profit, Catanzarite convinced state beneficiaries to obtain compounded medications regardless of their medical necessity. On several occasions, Catanzarite even paid an advanced nurse practitioner, introduced to him by the marketing company, or used a telemedicine service that was paid for by the marketing company, to fraudulently obtain compounded medication prescriptions. Altogether, Catanzarite caused losses of at least $3.5 million and personally made over $1.1 million from the scheme.

“One of the Defense Criminal Investigative Service’s (DCIS) top priorities is to protect the integrity of TRICARE, the DOD’s healthcare system for military members, retirees and their dependents,” stated Special Agent in Charge Leigh-Alistair Barzey of the DCIS Northeast Field Office. “This plea is the result of a joint effort and DCIS will continue to coordinate with the DOJ, FBI, HHS-OIG, MTA-OIG and other law enforcement partners to combat health care fraud.”

Kalaba

Kalaba admitted that from April 2016 through August 2017, he conspired to defraud the MTA’s health benefits plan using fraudulent claims for medically unnecessary compounded medications. Kalaba was recruited into the scheme by another former MTA bus driver, Christopher Frusci. Both Frusci and Kalaba acted as sales representatives of a company that marketed compounded medications.

Kalaba paid MTA beneficiaries monthly cash bribes, including $100 per phony prescription. To ensure physicians prescribed compounded medications regardless of medical necessity, Kalaba referred MTA beneficiaries to telemedicine physicians who were paid by the marketing company or its affiliates. Altogether, Kalaba caused losses of $2.9 million and made $138,629 from the scheme.

“Our investigation is ongoing to determine the extent to which additional MTA employees may have participated in this fraudulent scheme,” said Inspector General Barry Kluger of the MTA Office of the Inspector General. “I applaud and am pleased to support the efforts of the U.S. Attorney, along with the FBI and the Department of Defense Office of Inspector General, to combat this nationwide epidemic of health care fraud that unfortunately, and at great cost, has infected the MTA as well.”

Marsh and Johnson

Marsh, the owner and operator of TJB Medical Billing Consultants LLC, provided medical billing to two New Jersey chiropractors. Johnson worked as a supervisor in the New Jersey office of a large telecommunications company.

Marsh used her access to the billing software at the chiropractor offices to generate false claims for out-of-network chiropractic services that were never performed. The claims were made pursuant to an agreement between Marsh and Johnson, who recruited other employees to allow false claims to be made in their names in exchange for a portion of the proceeds. From June 2016 through November 2017, Marsh submitted approximately 800 fraudulent claims seeking approximately $850,000 in reimbursements, which resulted in the payment of approximately $333,000 for chiropractic services that were never rendered.

Pepe, Watson, and Hing

Between January 2018 and May 2018, Pepe, Watson, and Hing engaged in a conspiracy which resulted in the trafficking of 1,180 oxycodone pills – 680 of which were unadulterated oxycodone and 500 of which were pressed pills mixed with hydrocodone, codeine, and methylphenidate. As part of the investigation, law enforcement observed eight controlled purchases, three of which were carried out by the defendants – including Pepe dressed in his work scrubs – in front of the Philadelphia hospital where Pepe was employed.

“Philadelphia and Camden are awash in opioids, with the human toll mounting steadily, day by day,” said Michael T. Harpster, Special Agent in Charge of the FBI’s Philadelphia Division. “The idea of a medical professional taking a work break to push pills on the street, as alleged in the complaint, is at once disheartening and infuriating. The FBI will continue to doggedly investigate and bring to justice traffickers contributing to our area’s opioid crisis.”

“The individuals involved in these schemes are feeding this country’s opioid crisis,” said Scott J. Lampert, Special Agent in Charge for the Department of Health & Human Services Office of Inspector General. “This takedown sends a clear message that those suspected of engaging in health care fraud will be caught and face consequences for their actions.”

Agresti, Kalaba, Catanzarite, Marsh and Johnson each face a potential 10 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. Sentencing for Agresti, Catanzarite, and Kalaba is scheduled for Oct. 30, 2018. Pepe, Watson, and Hing each face a potential 20 years in prison and a $1 million fine. The charges and allegations against Marsh, Johnson, Pepe, Watson, and Hing are merely accusations, and they are considered innocent unless and until proven guilty.

U.S. Attorney Carpenito credited special agents of the FBI Newark Field Office, under the direction of Special Agent in Charge Ehrie; the FBI’s South Jersey Resident Agency, under the direction of Special Agent in Charge Harpster in Philadelphia; the U.S. Department of Health and Human Services, Office of Inspector General, under the direction of Special Agent in Charge Lampert; the U.S. Department of Defense, Defense Criminal Investigative Service, under the direction of Special Agent in Charge Barzey; the MTA Office of the Inspector General, under the direction of Inspector General Kluger, and special agents of the U.S. Attorney’s Office with the investigations that yielded this week’s guilty pleas and arrests. He also thanked the Camden County Police Department, under the direction of Chief J. Scott Thomson, and the Cherry Hill Police Department, under the direction of William Monaghan, for their assistance.

The government is represented in these cases by Assistant U.S. Attorney Erica Liu, Chief of the U.S. Attorney's Office Opioid Abuse Prevention and Enforcement Unit in Newark, and Assistant U.S. Attorneys Lauren E. Repole, Christina O. Hud and Diana Carrig of the U.S. Attorney’s Office Criminal Division.

CAMDEN, N.J. – A Camden County, New Jersey, man today admitted distributing images of child sexual abuse and violating the conditions of his supervised release imposed in connection with a previous child pornography conviction, U.S. Attorney Craig Carpenito announced.

Barnaby Hewsen, 43, of Pennsauken, New Jersey, pleaded guilty before U.S. District Judge Noel L. Hillman in Camden federal court to an information charging him with one count of distributing child pornography as well as a petition charging him with violating the conditions of federal supervised release by committing another crime while under supervision.

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

In May 2017, Hewsen uploaded three images containing images of child sexual abuse to a website. On June 2, 2017, law enforcement officers conducted a search of his residence and discovered seven videos and 373 images on his computer, some of which depicted prepubescent children and sadistic masochistic conduct involving the sexual abuse of infants and toddlers. In connection with the plea, Hewsen also admitted that he took these actions while on federal supervised release for a prior federal conviction for possessing child pornography.

The count of distribution of child pornography carries a mandatory minimum term of 15 years in prison and a maximum of 40 years in prison; the violation of supervised release carries a mandatory term of five years in prison, which may be imposed consecutively. Sentencing is scheduled for Oct. 5, 2018.

U.S. Attorney Carpenito credited special agents of U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI), under the direction of Special Agent in Charge Brian A. Michael; and the Camden County Prosecutor’s Office, under the direction of Prosecutor Mary Eva Colalillo, with the investigation leading to today’s guilty plea.

The government is represented by Assistant U.S. Attorney Gabriel J. Vidoni of the U.S. Attorney’s Office’s Criminal Division in Camden.

NEWARK, N.J. – A Bergen County, New Jersey, man today admitted conspiring with his father to file false federal tax returns for shell companies, resulting in $191,953 in fraudulent refunds, U.S. Attorney Craig Carpenito announced.

Jason Crespo, 35, of Elmwood Park, New Jersey, pleaded guilty before U.S. District Judge Jose L. Linares in Newark federal court to an information charging him with one count of conspiring with Jose Crespo, his father, to defraud the IRS by filing false corporate tax returns and cashing the resulting fraudulent refund checks.

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

Between 2010 and 2012, Jason and Jose Crespo filed numerous false federal corporate tax returns – IRS Forms 1120 – for fake businesses, knowing that the businesses were not real and that the credits claimed on the tax returns were false. The Crespos took advantage of fuel excise tax credits offered under federal tax law. The federal government taxes gasoline, diesel fuel, and certain other types of fuel, but certain commercial uses of these fuels are nontaxable. Businesses that purchase fuel for a nontaxable use can claim a tax credit by filing a “Credit for Federal Tax Paid on Fuels” – IRS Form 4136.

In one instance Jason and Jose Crespo filed a federal corporate tax return for 2008 for Jason Cleaning Service Corp. that falsely claimed a fuel excise tax credit of $14,556 and a resulting refund of $10,592. In fact, Jason Cleaning Service Corporation was a shell company and the fuel excise tax credit and other tax return numbers were false. Jason Crespo received and cashed the $10,592 refund check at a check-cashing facility in Guttenberg, New Jersey. He cashed many other refund checks for similar false tax returns at this same facility.

Jose Crespo pleaded guilty on Sept. 11, 2017, before Judge Linares to engaging in the fuel excise tax credit scheme and another tax fraud scheme, both of which claimed fraudulent refunds from the IRS of approximately $1.5 million. Jose Crespo was sentenced on Dec. 20, 2017, to three years in prison.

Marilyn Crespo, Jose Crespo’s wife, pleaded guilty on March 1, 2018, before Judge Linares to engaging in the same fuel excise tax credit scheme and causing a loss to the IRS of $286,742. She was sentenced June 27, 2018, to one year and one day in prison.

The filing a false tax return count carries a maximum potential penalty of three years in prison, and a potential $250,000 fine, or twice the gross gain or loss from the offense. Jason Crespo’s sentencing is set for Oct. 4, 2018.

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

The government is represented by Assistant U.S. Attorney Rahul Agarwal, Deputy Chief of the Criminal Division in Newark.

Defense counsel: Rubin Sinins Esq., Springfield, New Jersey

NEWARK, N.J. – A Salem County, New Jersey, woman was sentenced today to one year and one day in prison for signing false tax returns for shell companies resulting in $286,742 in fraudulent refunds, U.S. Attorney Craig Carpenito announced.

Marilyn Crespo, 50, of Carney’s Point, New Jersey, previously pleaded guilty before U.S. Chief District Judge Jose L. Linares to an information charging her one count of filing a false corporate tax return for tax year 2009. Judge Linares imposed the sentence today in Newark federal court.

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

Crespo previously resided in Guttenberg, New Jersey. At the direction of her husband, José Crespo, she signed under penalty of perjury numerous false corporate tax returns, Forms 1120, for fake businesses, knowing that the businesses were not real and that the credits claimed on the tax returns were false.

In signing these false tax returns, Marilyn Crespo took advantage of fuel excise tax credits offered under federal tax law. The federal government taxes gasoline, diesel fuel, and certain other types of fuel, but certain commercial uses of these fuels are nontaxable. Businesses that purchase fuel for a nontaxable use can claim a tax credit by filing Form 4136 entitled “Credit for Federal Tax Paid on Fuels.”

Marilyn Crespo signed a federal corporate tax return for 2009 for Magnum Cleaning Service Corp. that claimed gross receipts of $115,027, a fuel excise tax credit of $20,859 and a resulting refund of $15,750. In fact, Magnum was a shell company and the gross receipts and fuel excise tax credit numbers were false. Marilyn Crespo received and cashed the $15,750 refund check at a check-cashing facility in Guttenberg. She cashed many other refund checks for similar false tax returns at this same check-cashing facility.

José Crespo pleaded guilty on Sept. 11, 2017, before Judge Linares, to engaging in the fuel excise tax credit scheme and another tax fraud scheme and causing an anticipated loss to the IRS of nearly $1.5 million. He was sentenced Dec. 20, 2017, to three years in prison.

In addition to the prison term, Judge Linares sentenced Marilyn Crespo to one year of supervised release and ordered her to pay restitution of $286,742.

U.S. Attorney Carpenito credited special agents of IRS-Criminal Investigation, under the direction of Acting Special Agent in Charge Bryant Jackson, with the investigation leading to today’s sentencing.

The government is represented by Assistant U.S. Attorney Rahul Agarwal of the U.S. Attorney’s Office Special Prosecutions Division in Newark.

Defense counsel: Kenneth W. Kayser Esq., East Hanover, New Jersey

NEWARK, N.J. – A City of Paterson police officer today admitted violating an individual’s civil rights by assaulting him at a hospital and repeatedly distributing narcotics, including drugs he stole from a crime scene while on duty, U.S. Attorney Craig Carpenito announced.

Ruben McAusland, 26, of Paterson, pleaded guilty before U.S. District Judge William H. Walls in Newark federal court to an information charging him with possessing with intent to distribute narcotics and deprivation of civil rights under color of law.

“McAusland’s conduct breached his duties as an officer of the law and violated the public trust,” U.S. Attorney Carpenito said. “He dealt drugs, stole from a crime scene, and viciously attacked an individual who contacted the Paterson Police Department rightfully expecting to receive assistance and protection from McAusland and his partner. The people of Paterson, and all of New Jersey, deserve better. This Office remains strongly committed to identifying and rooting out corrupt police officers and bringing them to justice under federal law.”

“Police Officers take a solemn oath to uphold the law and to protect the public. The few who take advantage of this public trust, at any level, will be investigated by the FBI and prosecuted to the fullest extent of the law. This officer not only violated his pledge but tarnished the reputation of all law enforcement by his grievous lawlessness,” said Special Agent in Charge Gregory W. Ehrie of the Newark FBI Field Office.

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

Between October 2017 and April 2018, McAusland sold various types and quantities of narcotics to an individual who was cooperating with law enforcement. In October 2017, McAusland sold the individual approximately 35 grams of marijuana, 48 grams of heroin, 31 grams of cocaine, and 31 grams of crack cocaine. McAusland admitted that he stole these narcotics from a crime scene while on duty and in uniform as a police officer.

McAusland also sold the individual two pounds of marijuana between November 2017 and January 2018. In addition, on multiple occasions between February 2018 and April 2018, McAusland sold pills that were made to resemble Percocet doses but were actually made of heroin.

On March 5, 2018, McAusland and his partner, Roger Then, 29, of Paterson, were on duty and responded to a call from an attempted suicide victim. McAusland and Then first went to the victim’s house but were told the victim had been transported to St. Joseph’s Medical Center in Paterson.

McAusland first met the victim, who was in a wheelchair, in the hospital waiting room. McAusland admitted that during the encounter, he pushed the victim and punched him in the face. In addition, Then allegedly grabbed the victim by the neck and pushed him into the ground. Afterwards, the victim was taken to a hospital patient room.

McAusland and Then had another encounter with the victim in the hospital room, which Then recorded on his cellphone. McAusland admitted that, while the victim was on his back in a hospital bed, he put on a pair of hospital gloves and violently struck the victim twice across the face.

McAusland and Then filed a false police report in connection with the foregoing events. McAusland admitted that they purposely omitted from the repot the fact that McAusland violently struck the victim multiple times and that Then grabbed the victim by the neck and pushed him into the ground.

The victim suffered multiple injuries to his face, including an eye injury that required surgery, as a result of these assaults.

The distribution of narcotics charge carries a mandatory minimum penalty of five years in prison, a maximum potential penalty of 40 years in prison, and a $5 million fine. The deprivation of civil rights count carries a maximum potential penalty of 10 years in prison and a $250,000 fine. Sentencing is scheduled for Oct. 9, 2018.

Then was arrested May 30, 2018 and charged by complaint with conspiring to violate an individual’s civil rights and with misprision of felony for concealing civil rights violations. The charges and allegations against him are merely accusations, and he is presumed innocent unless and until proven guilty.

U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark, with the investigation leading to today’s plea. He also thanked the Passaic County Prosecutor’s Office, under the direction of Passaic County Prosecutor Camelia M. Valdes, the Paterson Police Department, under the direction of Paterson Police Director Jerry Speziale and Police Chief Troy Oswald, and the Paterson Police Department Office of Internal Affairs, for their assistance in the investigation.

The government is represented by Assistant U.S. Attorney Rahul Agarwal, Deputy Chief of the U.S. Attorney’s Office Criminal Division.

Defense counsel: John C. Whipple Esq., Morristown

NEWARK, N.J. – An Essex County, New Jersey, man was sentenced today to 168 months in prison for his leadership role in a massive drug distribution ring responsible for selling millions of dollars’ worth of heroin out of a residential building near a high school in Newark, U.S. Attorney Craig Carpenito announced.

Quawee Jones, a/k/a “Hatman,” 34, of Newark, previously pleaded guilty before U.S. District Judge Jose L. Linares to a superseding information charging him with conspiracy to distribute heroin. Judge Linares imposed the sentence today in Newark federal court

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

Jones and his co-defendants operated a heroin distribution marketplace out of the first floor hallway of a residential building at 25 Johnson Avenue in Newark. The building is just a few doors away from the Malcolm X. Shabazz High School and the Terrell James Park playground. The conspiracy was led by Quawee Jones and Almalik Anderson, who, along with other heroin dealers that worked with them, took advantage of the building’s location on a dead-end street, making it difficult for law enforcement to infiltrate the distribution network despite a constant stream of buyers entering the building at all hours of the day.

“Lookouts” were paid by the defendants to alert them to any police activity coming onto the block from the only access point on Clinton Avenue. Police could not infiltrate the building without lookouts detecting their presence and signaling the sellers. Members of the drug trafficking organization also set up an escape route whereby residents were paid to keep their doors unlocked. The dealers in the hallways would run through the building and exit via fire escapes at the rear of the building or simply hide within the apartments before police could apprehend them.

The drug conspiracy operated nearly 24 hours a day and was well-known among heroin users, who came from several different counties across New Jersey. The defendants allegedly worked in carefully planned “shifts” in order to handle the constant flow of heroin buyers. The heroin was sold in various “brands,” which were stamped onto the glassine envelopes that contained the heroin, allowing buyers to identify and purchase the brands that they preferred.
The defendants sold on average one to two kilograms of heroin per week between January 2013 and November 2015. Based upon the quantities sold, information from court-authorized wiretaps, and other evidence, the profit from the heroin distribution was estimated to be between $4 million and $7 million a year.

In addition to the prison term, Judge Linares sentenced Jones to five years of supervised release.

All 16 defendants indicted for their roles in the heroin distribution conspiracy, including Anderson, have been convicted.

U.S. Attorney Carpenito credited special agents of the FBI and task force officers assigned to the FBI’s Safe Streets Task Force, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark, with the investigation. He also thanked officers of the Newark Department of Public Safety, under the direction of Director Anthony F. Ambrose, the Essex County Sheriff’s Office under the direction of Armando B. Fontoura; the N.J. State Parole Board, under the direction of Chairman Samuel J. Plumeri Jr.; and the Orange Police Department, under Director Todd Warren, for their work on the investigation.

The government is represented by Assistant U.S. Attorneys Jonathan M. Peck and David E. Malagold, and Senior Litigation Counsel Robert Frazer of the U.S. Attorney’s Office Criminal Division in Newark.

Defense counsel: Stacy Ann Biancamano Esq. and Dan Holzapfel Esq., Cranford, New Jersey

CAMDEN, N.J. – A Ridley Park, Pennsylvania, man today admitted committing three armed robberies in Salem, Ocean, and Cumberland counties in November 2017, U.S. Attorney Craig Carpenito announced.

Jeffrey Edmonds, 45, pleaded guilty before Senior U.S. District Judge Jerome B. Simandle in Camden federal court to an information charging him with one count of Hobbs Act robbery, two counts of bank robbery, and one count of possession of a firearm in furtherance of a crime of violence.

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

On Nov. 1, 2017, Edmonds and Terrance Robinson, 31, of Havertown, Pennsylvania, drove together to a convenience store in Upper Pittsgrove Township, stopping along the way to pick up a handgun and remove the license plates from the car that Edmonds was driving. After arriving at the convenience store, Edmonds remained in the getaway car while Robinson entered the store with the handgun and stole approximately $179.

Edmonds and Robinson later robbed an Ocean First Bank in Upper Deerfield Township on Nov. 6, 2017 and a Fulton Savings Bank in Alloway Township on Nov. 14, 2017. Prior to robbing the banks, Edmonds and Robinson removed the license plates from the getaway car. Robinson stayed in the getaway car while Edmonds entered the banks and robbed them with a handgun.

Each of the three robbery offenses carries a maximum potential penalty of 20 years in prison. The possession of a firearm in furtherance of a crime of violence charge carries a consecutive minimum term of five years in prison and a maximum potential penalty of life imprisonment. Each offense also carries a potential $250,000 fine, or twice the gross gain or loss from the offense. Sentencing is scheduled for Oct. 5, 2018.

Robinson remains charged by complaint for his alleged roles in the robberies. The charges and allegations against him are merely accusations, and he is presumed innocent unless and until proven guilty.

U.S. Attorney Carpenito credited special agents of the FBI’s South Jersey Resident Agency, under the direction of Special Agent in Charge Michael Harpster in Philadelphia, special agents of the FBI Newark Field Office, under the direction of Special Agent in Charge Gregory W. Ehrie, and officers of the N.J. State Police, under the direction of Superintendent Col. Patrick J. Callahan, with the investigation.

The government is represented by Assistant U.S. Attorney Sara A. Aliabadi of the U.S. Attorney’s Office Criminal Division in Camden.

Defense Counsel: Wayne Powell Esq., Cherry Hill, New Jersey

TRENTON, N.J. – A Passaic, New Jersey, man was sentenced today to 92 months in prison for robbing six banks in Hudson, Union, and Passaic counties in June and July of 2016, U.S. Attorney Craig Carpenito announced.

Quentin Morales, a/k/a “Quinton Morales,” 27, previously pleaded guilty before U.S. District Judge Peter G. Sheridan to an information charging him with three counts of bank robbery. He also admitted to robbing two additional banks and attempting to rob another. Judge Sheridan imposed the sentence today in Trenton federal court.

Prior to his arrest in August 2016, Morales was one of Newark FBI’s most wanted bank robbers.

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

 Morales robbed, or attempted to rob, the following New Jersey banks:

Bank

Location

Date

Wells Fargo Bank

Kearny, New Jersey

June 24, 2016

Capital One Bank (attempted)

Elizabeth, New Jersey

June 27, 2016

Wells Fargo Bank

Kenilworth, New Jersey

June 30, 2016

Wells Fargo Bank

Linden, New Jersey

July 6, 2016

Wells Fargo Bank

Clifton, New Jersey

July 13, 2016

Wells Fargo Bank

Union, New Jersey

July 25, 2016

At each bank, Morales presented a note demanding cash from bank tellers. For example, during the June 24, 2016, robbery, Morales handed the teller a note stating “You are being robbed. Give me all the large bills you have, no alarms, no noise.” On at least two occasions, Morales said he had a gun and urged bank tellers to hurry. He was apprehended on Aug. 2, 2016, by officers of the N.J. State Parole Board.

In addition to the prison term, Judge Sheridan sentenced Morales to three years of supervised release and ordered to pay restitution of $9,217.

U.S. Attorney Carpenito credited special agents of the FBI’s Violent Crimes/Interstate Theft Task Force, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark, with the investigation leading to today’s sentencing. He also thanked the N.J. State Parole Board and the Kearny, Elizabeth, Kenilworth, Linden, Clifton, Union Township and Newark police departments, as well as the Essex County Prosecutor’s Office for their efforts in the investigation and apprehension of Morales.

The government is represented by Assistant U.S. Attorney Elisa Wiygul of the U.S. Attorney’s Office Criminal Division in Trenton.

Defense counsel: Linda D. Foster Esq., Assistant Federal Public Defender (Newark)

CAMDEN, N.J. – A Cherry Hill, New Jersey, man today admitted his role in conspiring to sell at least 100 handguns without a federal firearms license, U.S. Attorney Craig Carpenito announced.

Fr’Neil Hickson, a/k/a “Philly,” 38, pleaded guilty before U.S. District Judge Robert B. Kugler in Camden federal court to Count Two of an indictment charging him with conspiracy to deal in firearms without a federal firearms license.

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

Hickson admitted that between December 2009 and April 2013 he sold or brokered the sale of at least 100 handguns obtained from sources outside of New Jersey. The investigation showed that Hickson obtained many of the weapons from Joshua Jackson, a/k/a “Apple,” a/k/a “Trent,” and that Jackson obtained most of the firearms through purchases at gun shows from unlicensed gun sellers without background checks. Some of the firearms were also purchased at Ohio gun stores by straw purchasers working for Jackson, who transported the handguns to New Jersey and resold them to Hickson and Terrance Laboo, a Camden drug dealer. Hickson admitted some of the weapons were equipped with extended magazines capable of holding more than 15 rounds of ammunition.

Hickson also sold handguns directly to Terrance Laboo. At the time of the gun sales, Laboo was engaged with others in drug trafficking, including the sale of PCP and cocaine at the corner of 4th and Chestnut streets in Camden. Hickson and Laboo sold, directed or brokered the sale of many of the firearms to other drug dealers and felons in Camden and surrounding areas.

The count of conspiracy to deal in firearms without a license to which Hickson pleaded guilty carries a maximum potential penalty of five years in prison and a $250,000 fine. Sentencing is scheduled for Oct. 1, 2018.

Hickson has been in federal custody since his arrest in Atlanta, Georgia, on April 29, 2014. In a separate case in Atlanta, investigated jointly by ATF agents from the Atlanta office and the District of New Jersey, Hickson was arrested for illegal possession of 12 firearms. He pleaded guilty in Atlanta federal court to possession of firearms by a convicted felon and on Oct. 25, 2016, he was sentenced to four years in prison by U.S. District Judge Steve C. Jones. Hickson completed his sentence in that case in August 2017, but remained in federal custody on the indictment that resulted in today’s guilty plea.  

This case was part of a long-term investigation of illegal gun trafficking referred to as “Operation Buckeye,” as the bulk of the illegal guns recovered from felons in the Camden, Philadelphia and surrounding areas were originally purchased in Ohio.

On July 21, 2016, Laboo, who had previously pleaded guilty to dealing in firearms without a license, conspiracy to deal in firearms without a license, possession of firearms by a convicted felon, and distribution of a controlled substance, was sentenced by Judge Kugler to six years in prison. On Oct. 25, 2016, Jackson, of Willingboro, New Jersey, who had previously entered a guilty plea to dealing in firearms without a license, conspiracy to deal in firearms without a license, and possession of firearms by a convicted felon, was sentenced to six years in prison.

The ATF investigation showed that the conspiracy involved the illegal acquisition, interstate transfer, and illegal sale of approximately 300 handguns to drug dealers and others. 

U.S. Attorney Craig Carpenito credited special agents of the ATF Newark Field Division, under the direction of Special Agent in Charge John B. Devito; the N.J. State Police, under the direction of Col. Patrick J. Callahan; the Camden County Prosecutor’s Office, under the direction of Mary Eva Colalillo; and the Burlington County Prosecutor’s Office, under the direction of Scott A. Coffina, with the investigation leading to today’s guilty plea.  

The government is represented by Assistant U.S. Attorneys Patrick C. Askin and Alyson Oswald of the U.S. Attorney’s Office in Camden.

CAMDEN, N.J. – A Burlington County, New Jersey, man today admitted stealing his disabled brother’s Social Security benefits, U.S. Attorney Craig Carpenito announced.

Steven Mitchell, 43, of Marlton, New Jersey, pleaded guilty before U.S. District Judge Jerome B. Simandle in Camden federal court to an information charging him with one count of theft of government funds.

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

Mitchell admitted that prior to 2010 his brother was receiving Disabled Adult Child Survivor benefits from the Social Security Administration (SSA). After the death of their mother in 2009, Mitchell became the representative payee with the SSA for his disabled brother in 2010. Mitchell acknowledged that the SSA funds were to be used to pay for his brother’s care at a facility run by the N.J. Division of Developmental Disabilities. Mitchell was supposed to provide Prince Association for the Developmentally Disabled, which is part of the N.J. Division of Developmental Disabilities, with 75 percent of his brother’s survivor benefits to pay for his brother’s care and maintenance at the facility.

While Mitchell was the representative payee, the SSA paid benefits into his brother’s bank account. Mitchell admitted that instead of paying for his brother’s care, he accessed his bank account by making withdrawals and used that money to pay for his personal expenses, including utilities, food, and car payments. Mitchell admitted that from February 2010 to April 2017, he collected $110,495 to which he was not entitled.

The charge to which Mitchell pleaded guilty carries a maximum potential penalty of 10 years in prison and a $250,000 fine. Sentencing is scheduled for Oct. 15, 2018.

U.S. Attorney Carpenito credited special agents of the SSA, Office of Inspector General, under the direction of Special Agent in Charge Edward J. Ryan, with investigation leading to today’s guilty plea.

The government is represented by Senior Litigation Counsel Jason M. Richardson of the U.S. Attorney’s Office Criminal Division in Camden and Special Assistant U.S. Attorney Meriah Russell of the U.S. Attorney's Office Criminal Division in Trenton.

Defense counsel: Maggie Moy Esq., Assistant Federal Public Defender, Camden

CAMDEN, N.J. – A Moorestown, New Jersey, man today admitted impersonating a federal agent while selling counterfeit coins and unlawfully importing counterfeit coins and bars into the United States, U.S. Attorney Craig Carpenito announced.

Jonathan A. Kirschner, a/k/a “Jonathan Kratcher,” 34, pleaded guilty before U.S. District Judge Robert B. Kugler in Camden federal court to an information charging him with one count of falsely impersonating an agent of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) and one count of unlawfully bringing counterfeit coins and bars into the United States.

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

Kirschner admitted that on May 9, 2017, he sold fake gold bars to a coin collector (Victim 1) for $11,000 in cash. Kirschner wore an ATF badge on a chain around his neck and claimed to be an ATF agent in written correspondence with Victim 1 and when they met in person. Kirschner also admitted that he sold 49 counterfeit Morgan dollar coins to two people (Victims 2 and 3) in Mt. Laurel, New Jersey, on June 4, 2017. Kirschner told Victims 2 and 3, “I have my badge on,” when providing descriptive information so that Victims 2 and 3 could recognize Kirschner. He admitted that he pretended to be an ATF agent to put his victims at ease in purchasing what Kirschner claimed were gold coins and bars when, in reality, the coins and bars were fake. Kirschner admitted unlawfully bringing counterfeit coins and bars into the United States by importing multiple, falsely manifested packages from other countries, including China.

The charge of impersonating a federal officer carries a maximum potential penalty of three years in prison and the charge of unlawful importation carries a maximum potential penalty of 15 years in prison. Sentencing is scheduled for Oct. 1, 2018.

U.S. Attorney Carpenito credited ATF special agents, under the direction of Special Agent in Charge John B. Devito, Newark Field Division; and special agents of U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI), Cherry Hill Office, under the direction of Acting Special Agent in Charge Brian A. Michael, with the investigation leading to today’s guilty plea.

The government is represented by Assistant U.S. Attorney Alyson M. Oswald of the U.S. Attorney’s Office’s Criminal Division in Camden.

Defense counsel: Leonard D. Biddison Esq., Haddonfield, New Jersey

NEWARK, N.J. – A New Brunswick, New Jersey, man was convicted at trial today for his violent role in a racketeering conspiracy involving multiple brothels that employed illegal aliens throughout New Jersey, U.S. Attorney Craig Carpenito announced.

Wilmer Chavez Romero, a/k/a “Charmin,” 29, was convicted of all eight counts of an indictment charging him with one count each of racketeering, racketeering conspiracy, assault with a dangerous weapon in aid of racketeering, and conspiracy to harbor aliens; two counts of using a firearm for a violent crime; and two counts of murder in aid of racketeering. He was convicted following a two and a half-week trial before U.S. District Judge William H. Walls in Newark federal court. The jury deliberated for five and a half hours before returning the guilty verdict.

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

Chavez Romero served as an enforcer for a prostitution enterprise that helped illegal aliens enter the country and employed them at brothels throughout Cumberland, Essex, Mercer, Middlesex, Monmouth and Ocean counties. The enterprise used threats and acts of violence – including burglary, assaults, and murder – to expand its territory, thwart rival brothels, exact revenge, punish enterprise members and associates who had been disloyal, and silence people they believed were cooperating with law enforcement. 

Chavez Romero acted at the direction of the leaders of the enterprise, Juan Fredy Hernandez-Zozaya, 40, and his girlfriend, Elizabeth Rojas, 36, both of New Brunswick, who oversaw brothels in New Brunswick, Trenton, Orange, Asbury Park, Lakewood, and Bridgeton. 

Chavez Romero personally committed acts of violence to further the enterprise, including participating in the murders of two victims during separate robberies. On Sept. 4, 2012, Chavez Romero, armed with a firearm, entered a rival brothel house in Trenton with the intent to rob the house. During the robbery, one victim was shot in the leg and survived, while another was shot and killed.
 
On Jan. 23, 2013, Chavez Romero entered another rival brothel in Trenton armed with a .40 caliber firearm. Chavez Romero attempted to commit a robbery when a fight broke out and a victim was shot and killed. 

In addition, during recorded interviews with law enforcement in 2012 and 2014, Chavez Romero discussed his role in the murders, as well as beatings, shootings, and other acts of violence that he committed to further the enterprise’s goals and shut down its competition. As part of the enterprise, Chavez Romero also conspired to conceal and harbor aliens and aided in their interstate transport for use in the prostitution enterprise.

The racketeering and racketeering conspiracy charges carry a potential life sentence. The assault with a dangerous weapon in aid of racketeering charge carries a maximum potential penalty of 20 years in prison. Both murder in aid of racketeering counts carry a mandatory term of life imprisonment. Each use of a firearm during a violent crime count carries a mandatory consecutive term of 10 years in prison. The conspiracy to harbor illegal aliens count carries a maximum potential term of 10 years in prison. All counts in the indictment carry a potential $250,000 fine. Chavez Romero’s sentencing is scheduled for Sept. 25, 2018.

U.S. Attorney Carpenito credited special agents of Department of Homeland Security, Homeland Security Investigations, under the direction of Special Agent in Charge Brian Michael in Newark, as well as the Cumberland County Prosecutor’s Office, Trenton Police Department, Mercer County Prosecutor’s Office, and the N.J. State Police Ballistics Lab, with the investigation leading to today’s conviction. 

The government is represented by Assistant U.S. Attorneys Meredith Williams and Melissa Wangenheim of the U.S. Attorney’s Office Criminal Division in Newark.

Defense counsel: Kevin F. Carlucci Esq. and Carol Gillen Esq., Assistant Federal Public Defenders, Newark

NEWARK, N.J. – A Passaic County, New Jersey woman today admitted her role in a month-long crime spree that included attempting to rob a Citizens Bank, in Tannersville, Pennsylvania, at gunpoint, conspiring to rob a Keystone Bank in Scotrun, Pennsylvania, and robbing a Spencer Savings Bank in Garfield, New Jersey, at gunpoint, U.S. Attorney Craig Carpenito announced.

Melisa Aquino Arias, 23, of Passaic, New Jersey, pleaded guilty today before U.S. District Judge Stanley R. Chesler in Newark federal court to an information charging her with one count of attempted bank robbery, one count of attempted conspiracy to steal from a bank, and one count of bank robbery. On April 5, 2018, her co-defendant, Swahilys Pedraza-Rodriguez, 19, of New Haven, Connecticut, pleaded guilty before Judge Chesler in Newark to an information charging her with the same offenses.

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

On Aug. 28, 2017, Arias and Pedraza-Rodriguez, both disguised in nuns’ habits, entered a Citizens Bank in Tannersville, Pennsylvania. While inside, Arias acted as a lookout as Pedraza-Rodriguez took out what appeared to be gun and demanded money from a bank teller. Arias signaled to Pedraza-Rodriguez that they should leave the bank and the women fled empty-handed.

On Sept. 20, 2017, Arias and Pedraza-Rodriguez agreed to steal money from the drive-through ATM machine at a Keystone Bank in Scotrun, Pennsylvania. Arias drove them, both wearing hijabs, to the ATM machine and again acted as a lookout while Pedraza-Rodriguez attempted to pry open the ATM machine with a screwdriver. Those attempts were unsuccessful, and the women again fled the scene.

On Sept. 27, 2017, Pedraza-Rodriguez and Arias entered a Spencer Savings Bank in Garfield, New Jersey, and asked a bank teller for information about opening a bank account. Arias, who was wearing a blue hijab, took out what appeared to be a black handgun and demanded money, while Pedraza-Rodriguez stood guard by the bank manager. After a bank teller handed them some cash, the defendants left the bank and employees immediately alerted the police. Law enforcement officers responded to the scene, but did not immediately locate the robbers. 

On Oct. 15, 2017, Pedraza-Rodriguez and Arias entered an NVE Bank in Teaneck, New Jersey. Arias wore an orange hijab and Pedraza-Rodriguez wore a black head covering. They approached a bank employee and requested information about opening a bank account. The employee recognized the women as the alleged perpetrators of the Garfield bank robbery. As the employee went to alert the police, the women left the bank. Pedraza-Rodriguez and Arias were apprehended soon after by law enforcement officers. 

The bank robbery and attempted bank robbery counts each carry maximum potential penalties of up to 20 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. The conspiracy to commit bank larceny count carries a maximum potential penalty of one year in prison. Sentencing for Arias is scheduled for Sept. 12, 2018. Sentencing for Pedraza-Rodriguez is scheduled for Aug. 15, 2018.

U.S. Attorney Carpenito credited special agents with the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark; the Garfield Police Department, under the direction of Chief Raymond Kovach; the Teaneck Police Department, under the direction of Chief Glenn M. O'Reilly; the Leonia police department, under the direction of Chief Thomas P. Rowe; and the Pocono Township Police Department, under the direction of Chief Kent Werkheiser with the investigation leading to the guilty pleas.

The government is represented by Assistant U.S. Attorney Joshua L. Haber of the U.S. Attorney’s Office Criminal Division in Newark.

NEWARK, N.J. – The president of a staffing company was arrested this morning for allegedly used phony invoices and time cards to defraud a commercial finance lending company of $400,000, U.S. Attorney Craig Carpenito announced.

Jeremy Hare, 47, of Philadelphia, is charged by complaint with one count of wire fraud. He is scheduled to appear this afternoon before U.S. Magistrate Judge Leda Dunn Wettre in Newark federal court.

According to the complaint:

Hare was the president and managing member of Apollo Search Partners LLC, a staffing agency with an office in New Jersey. The victim company was a commercial finance lender that offers funding to companies in order to meet payroll and other obligations.

On June 16, 2017, Hare had Apollo enter into a financing agreement with the victim company. In order to get funding, Apollo would provide the Victim Company invoices and supporting time cards for each person Apollo staffed with a client. Approved clients were supposed to submit payment to the victim company.

However, between June 20, 2017 and Aug. 15, 2017, Hare submitted more than 15 invoices to the victim company even though Apollo never staffed most of the individuals listed on the invoices and the time sheets submitted with the invoices included hours that were never worked.

In response to the invoices, the victim company provided funding of approximately $400,000 to Apollo between June and August 2017. To date, the victim company has not received reimbursement for the money it funded Apollo in response to the phony invoices.

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

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

U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark, with the investigation leading to today’s arrest. He also thanked special agents of the FBI in Philadelphia for their assistance in this case.

The government is represented by Assistant U.S. Attorney Andrew Kogan of the U.S. Attorney’s Office Cybercrime Prevention and Enforcement Unit in Newark.

NEWARK, N.J. – A Pearl River, New York, man today admitted photographing and filming a child engaged in sexually explicit conduct and sharing those images online, U.S. Attorney Craig Carpenito announced.

Richard Murphy, 32, pleaded guilty before U.S. District Judge John Michael Vazquez in Newark federal court to an information charging him with sexual exploitation of a minor.

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

Murphy admitted that in December 2016, he persuaded a child to engage in sexually explicit conduct for the purpose of taking photos and videos of that conduct. Murphy also admitted that he took video of the child performing a sex act on him. In addition, Murphy admitted that he shared the sexually explicit images with another individual online.

The sexual exploitation charge carries a mandatory minimum sentence of 15 years in prison, a maximum potential penalty of 30 years in prison, and a $250,000 fine. Sentencing is scheduled for Sept. 25, 2018.

U.S. Attorney Carpenito credited special agents of Department of Homeland Security, Homeland Security Investigations, under the direction of Acting Special Agent in Charge Brian Michael, with the investigation.

The government is represented Assistant U.S. Attorneys Danielle Alfonzo Walsman, Chief of the U.S. Attorney’s Office Public Protection Unit, and Leticia Vandehaar, Chief of Staff to the U.S. Attorney.

Defense counsel: David I. Goldstein, Chestnut Ridge, New York

CAMDEN, N.J. – A Knoxville, Tennessee, man was sentenced today to 20 months in prison for recruiting individuals to cash fraudulent money orders that he received from a former South Jersey U.S. Postal Service (USPS) employee, U.S. Attorney Craig Carpenito announced.

Eugene Bowen, 35, previously pleaded guilty before U.S. District Judge Joseph H. Rodriguez to an information charging him with one count of transmitting and presenting unlawfully issued USPS money orders with intent to defraud the United States. Judge Rodriguez imposed the sentence today in Camden federal court.

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

Bowen admitted that Marc Saunders, 40, of Sicklerville, New Jersey, a former employee at the USPS branch in New Lisbon, New Jersey, provided him with stolen money orders and told him to recruit others to cash them. Bowen admitted that he recruited individuals to cash the money orders and paid them a small fee, while keeping the rest of the money for Saunders and himself.

In addition to the prison term, Judge Rodriguez sentenced Bowen to three years of supervised release and ordered to pay restitution of $18,470.

On Dec. 12, 2017, Saunders pleaded guilty to his role in the scheme, including producing the money orders with a stolen imprinting machine and giving them to others to cash. His sentencing is scheduled for July 24, 2018.

Acting U.S. Attorney Carpenito credited special agents of the USPS, Office of the Inspector General, under the direction of Acting Special Agent in Charge Kenneth M. Cleevely of the Eastern Area Field Office, with the investigation leading to today’s sentencing.

The government is represented by Assistant U.S. Attorney Alyson M. Oswald of the U.S. Attorney’s Office Criminal Division in Camden.

Defense counsel: John Brennan Esq., Marlton, New Jersey

NEWARK, N.J. – A Riverside, California, man today pleaded guilty to his role in a conspiracy to transport more than five kilograms of cocaine from California to New Jersey, U.S. Attorney Craig Carpenito announced.

Edwin Garcia Cambero, 26, pleaded guilty before U.S. District Judge Jose L. Linares in Newark federal court to an information charging him with conspiracy to possess with intent to distribute more than five kilograms of cocaine.

Garcia Cambero was originally charged by complaint on Dec. 13, 2017, with Luis Michel Donascimento, 36, of Perris, California, and Humberto Ramos Cervantes, 33, of Los Angeles.

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

On Nov. 29, 2017, Donascimento allegedly flew from California to Atlantic City, New Jersey, and met with a government informant and two undercover federal agents. During the meeting, Donascimento agreed to sell the agents 20 kilograms of cocaine, as well as 10 AR-15 semiautomatic rifles.

On Dec. 12, 2017, Donascimento allegedly met with the agents at a hotel in California and delivered them 10 AR-15 rifles as promised. Garcia Cambero also attempted to deliver approximately five kilograms of cocaine to the agents, which he had received earlier that day at his residence from Ramos Cervantes.

The conspiracy charge to which Garcia Cambero pleaded guilty carries a mandatory minimum penalty of 10 years in prison, a maximum potential penalty of life in prison, and a $10 million fine. Sentencing is scheduled for Sept. 20, 2018.

The charges and allegations against Donascimento and Ramos Cervantes are merely accusations, and they are considered innocent unless and until proven guilty. All three defendants have been in custody since their arrest in California on Dec. 13, 2017.

U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark, and the FBI Riverside, California, Resident Agency, under the direction of Assistant Director in Charge Paul D. Delacourt in Los Angeles, with the investigation leading to today’s plea.

The government is represented by Assistant U.S. Attorney Sammi Malek of the U.S. Attorney’s Office Organized Crime Drug Enforcement Task Force (OCDETF)/Narcotics Unit.

Defense counsel: Henry Klingeman Esq., Newark, New Jersey

TRENTON, N.J. – Two California men who were arrested in Mercer County, New Jersey, with over 50 pounds of crystal methamphetamine and nine kilograms of heroin appeared today in Trenton federal court, U.S. Attorney Craig Carpenito announced.

Gabriel Acosta Villa, 29, of Lake Forest, California, and Oscar Perez Jr., 23, of Santa Ana, California, are both charged by complaint with one count of conspiracy to possess with intent to distribute methamphetamine and one count of conspiracy to possess with intent to distribute heroin. They appeared this afternoon before U.S. Magistrate Judge Lois H. Goodman and were detained.

According to the complaint:

On June 17, 2018, law enforcement officers received information that a commercial truck driver and his accomplice planned to sell approximately 50 pounds of crystal methamphetamine to a buyer in the Trenton area. Law enforcement officers set up surveillance near the parking lot of a Robbinsville, New Jersey, restaurant and observed Acosta walking through the parking lot with two large bags. After Acosta entered a nearby vehicle, law enforcement officers stopped the vehicle and discovered 51.31 pounds of a substance that tested positive for methamphetamine.

After detaining Acosta, law enforcement officers searched the area and discovered Perez walking alone near the loading docks of a nearby hardware store. A large white tractor trailer was parked nearby with the engine still running. A subsequent search of the tractor’s cab uncovered 9.5 kilograms of a substance that tested positive for heroin.
        
Both defendants face a mandatory minimum penalty of 10 years in prison, a maximum potential penalty of life in prison, and a $10 million fine.

U.S. Attorney Carpentio credited special agents of Department of Homeland Security, Homeland Security Investigations (HSI) Cherry Hill, under the direction of Resident Agent in Charge Richard Reinhold, and overseen by Acting Special Agent in Charge Brian Michael of HSI Newark, and the Drug Enforcement Administration’s New Jersey Division, under the direction of Special Agent in Charge Valerie A. Nickerson in Newark, with the investigation. He also thanked officers of the N.J. State Police, under the direction of Superintendent Col. Patrick J. Callahan, for their assistance.

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

The government is represented by Assistant U.S. Attorney Molly Lorber of the U.S. Attorney’s Office Criminal Division in Trenton.

NEWARK, N.J. – Two men have been charged for their alleged roles in transporting $2.3 million worth of stolen perfume products out of New Jersey, U.S. Attorney Craig Carpenito announced today.

Yunior Estevez, 33, of Hollywood, Florida, and Carlos Duvergel, 53, of Colorado Springs, Colorado, were both charged by complaint with conspiracy and with the interstate transport of stolen property. Estevez will make his initial appearance today before U.S. Magistrate Judge Mark Falk in Newark federal court. Duvergel made his initial appearance on June 6, 2018, before U.S. Magistrate Judge James B. Clark III in Newark federal court and was released on bail on June 7, 2018.

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

In November 2017, the defendants and others obtained unauthorized access to a warehouse storing perfume products in Edison, New Jersey, and drove away with at least one tractor-trailer filled with stolen perfume products. Toll plaza footage from the N.J. Turnpike revealed Estevez to be driving the tractor-trailer out of New Jersey and into Delaware. The value of the stolen perfume products is estimated to be $2.3 million.

The conspiracy count is punishable by a maximum potential penalty of five years in prison. The charge of interstate transport of stolen property is punishable by a maximum penalty of 10 years in prison. Both charges also carry a $250,000 fine, or twice the gross gain or loss from the offenses.

U.S. Attorney Carpenito credited special agents with the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie, and the Edison Police Department, with the investigation leading to these charges.

The government is represented by Special Assistant U.S. Attorney Leah Gould of the U.S. Attorney’s Office Public Protection Unit in Newark.

WASHINGTON – Thomas J. Eicher, Deputy U.S. Attorney for the District of New Jersey, was one of 162 members of the Department of Justice recognized by Deputy Attorney General Rod Rosenstein, and Executive Office for U.S. Attorneys (EOUSA) Director James Crowell IV at the 34th Director’s Awards Ceremony today in Washington, D.C.

The District of New Jersey was one of 35 districts represented at a ceremony held in the Great Hall at the Robert F. Kennedy Department of Justice Building.

In addressing the award recipients and guests, Deputy Attorney General Rosenstein said, “Today’s honorees earned the esteem of their colleagues. But most importantly, they earned the gratitude of our fellow citizens — the people whose communities you made safer, whose lives you improved, and whose trust you rewarded. Today, we pause to honor and recognize a small portion of your work.”

Deputy U.S. Attorney Eicher was recognized for his leadership, effectiveness, personal integrity, and dedication to public service over the course of his 30-year career with the Department. As Chief of the Criminal Division, his breadth of experience and knowledge permits him to effectively manage one of the largest criminal divisions in the country. He helped establish New Jersey’s first federal reentry and “pre-trial” courts. He successfully pushed for innovative data-driven violent crime strategies and plays an important leadership role in the Public Safety Partnership and Violent Enterprise Source Targeting initiatives, which are key components in the Department’s strategy to combat drug trafficking and violent crime. In addition to the substantial leadership and guidance he provides, Deputy U.S. Attorney Eicher contributed to the efficiency and effectiveness of the Department through his leadership of the Criminal Chiefs Working Group and participation on the Attorney General’s Advisory Committee.

“For three decades, the past 15 years of which have been spent in our office, Tom Eicher has represented the U.S. Attorney community with professionalism and distinction,” U.S. Attorney Craig Carpenito, District of New Jersey, said. “As Chief of our Criminal Division, he developed strategies aimed at protecting the public by focusing on the most violent criminals and directed the further development of the office’s highly-regarded white collar programs. Now, as Deputy U.S. Attorney, he oversees the important work of our Camden and Trenton offices while continuing to be a trusted and reliable part of our leadership team. I am gratified that he has now been recognized with the Justice Department’s prestigious Executive Achievement Award, and I could not be prouder of Tom and the way he has represented our office.”

EOUSA provides oversight, general executive assistance, and direction to the 94 United States Attorneys’ offices around the country. For more information on EOUSA and its mission, visit http://www.justice.gov/usao .

NEWARK, N.J. – A Newark man will appear in federal court today to face charges for his alleged involvement in the September 2017 armed robbery of a jewelry exchange located in Elizabeth, New Jersey, U.S. Attorney Craig Carpenito announced.

William Valentin, 42, is charged by complaint with one count of conspiring to commit Hobbs Act robberies, one count of Hobbs Act robbery, one count of brandishing a firearm during a crime of violence, and one count of conspiring to use a firearm during a crime of violence. Valentin was scheduled to make his initial appearance today before U.S. Magistrate Judge Mark Falk in Newark federal court.

According to the complaint:

On the morning of Sept. 5, 2017, four masked individuals, including Valentin, entered a jewelry exchange located in Elizabeth. Valentin then brandished a firearm at an employee while the other conspirators unloaded the contents of the store’s safes into large bags. Video surveillance showed Valentin and other conspirators entering the mall, approaching the jewelry exchange, and running out with the bags of jewelry. Afterwards, Valentin and his conspirators jumped into a black Audi and drove away.

In January 2018, Valentin was arrested in Holyoke, Massachusetts, with a backpack containing jewelry stolen from the Elizabeth exchange in his possession.

The count of brandishing a firearm during a crime of violence carries a mandatory minimum sentence of seven years in prison, which must be imposed consecutive to any other sentence imposed. The Hobbs Act, Hobbs Act conspiracy, and conspiracy to use a firearm in the commission of a crime of violence charges each carry a statutory maximum of 20 years in prison and a $250,000 fine, or twice the gain or loss from the offense.

The charges and allegations in the complaint are merely accusations, and Valentin is considered innocent unless and until proven guilty.

U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark, the Elizabeth Police Department, under the direction of Chief Ronald Simon, and the Union County Prosecutor’s Office, under the direction of Acting Prosecutor Michael A. Monahan, with the investigation leading to today’s charges. He also thanked the Holyoke Police Department, under the direction of Chief James Neiswanger, for its assistance.

The government is represented by Assistant U.S. Attorney Lauren E. Repole of the U.S. Attorney’s Office Public Protection Unit in Newark.

TRENTON, N.J. – A Bronx, New York, man arrested for distributing approximately eight pounds of methamphetamine has made his initial appearance in federal court, U.S. Attorney Craig Carpenito announced today.

Anthony Morales, 44, was arrested June 13, 2018, and charged by complaint with one count of distribution of 500 grams or more of methamphetamine. He appeared yesterday before U.S. Magistrate Judge Lois H. Goodman in Trenton federal court and was detained.

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

In June 2018, a Homeland Security Investigations (HSI) source provided information to HSI that a sale of a large volume of methamphetamine would be taking place in the parking lot of a restaurant in Moorestown, New Jersey.

On June 12, 2018, law enforcement officers observed Morales and another individual (Person One) meet in the restaurant’s parking lot before Morales handed Person One a box. As Person One walked away from Morales, law enforcement officers converged on the parking lot and arrested both individuals. Morales told law enforcement officers that he had arrived at restaurant earlier that day to sell Person One approximately 8 pounds of methamphetamine, and that he had, in fact, distributed the methamphetamine to Person One in a box. Morales admitted that he was arrested while waiting for Person One to pay him for the methamphetamine.

The methamphetamine distribution charge carries a mandatory minimum penalty of 10 years in prison, a maximum of life imprisonment, and a $10 million fine.

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

U.S. Attorney Carpenito credited special agents of HSI, under the direction of Resident Agent in Charge Richard Reinhold in Cherry Hill, with the investigation leading to the charge.

The government is represented by Assistant U.S. Attorneys R. Joseph Gribko and Eric A. Boden of the U.S. Attorney’s Office in Trenton.

Defense counsel: Andrea Bergman Esq., Assistant Federal Public Defender, Trenton

NEWARK, N.J. – The U.S. Attorney’s Office for the District of New Jersey filed a lawsuit today against the Borough of Woodcliff Lake, New Jersey, alleging that the borough and its zoning board violated the Religious Land Use and Institutionalized Persons Act of 2000 (RLUIPA) when it denied zoning approval to allow an Orthodox Jewish congregation to build a house of worship on its property and took steps to keep it from building a house of worship anywhere else in the borough.

According to the complaint, Valley Chabad, an Orthodox Jewish congregation located in Woodcliff Lake, spent nine years searching for a property within the area suitable to construct a house of worship. However, when Valley Chabad attempted to buy three different sites between 2005 and 2013, the borough thwarted those attempts in various ways, including expressing interest in rezoning or acquiring those properties through eminent domain after Valley Chabad entered contracts to purchase them. The borough ultimately acquired two of the properties and rezoned the third.

Unable to purchase a new property in the area that was suitable for their needs, Valley Chabad submitted a variance application to the Woodcliff Lake zoning board to construct a larger house of worship at its current location in the borough. After two years, 18 hearings, and substantial revisions by Valley Chabad to address size and transportation concerns, the zoning board denied the application.

The zoning board cited aesthetic concerns, the adverse impact on the “residential character of the neighborhood,” and safety issues that were undermined by the testimony of the zoning board’s own experts. The board also noted parking limitations that were the result of a 2016 ordinance enacted well after Valley Chabad submitted its variance application in 2014. In addition, when citing concerns that Valley Chabad would not adhere to the occupancy limits proposed in the application, the zoning board falsely characterized testimony from a Valley Chabad rabbi about prior attempts to control crowds.

“Federal law protects all religious communities from discrimination and unlawful barriers when they seek to build a place of worship,” said U.S. Attorney Carpenito. “According to the complaint, the Borough of Woodcliff Lake imposed a substantial burden on Valley Chabad’s religious freedom by repeatedly meddling in its attempts to purchase property in the area and citing subjective and misleading reasons to justify denying its zoning application.”

“The right to use land for religious exercise, free from unduly burdensome or discriminatory restrictions, is a fundamental constitutional right,” said Acting Assistant Attorney General John Gore of the Justice Department’s Civil Rights Division. “The Department of Justice remains vigilant in its enforcement of federal civil rights laws protecting religious groups’ ability to establish places of worship without improper interference.”

The Department of Justice today announced the “Place to Worship Initiative,” which will focus on protecting the ability of houses of worship and other religious institutions to build, expand, buy, or rent facilities – as provided by the land use provisions of the RLUIPA. As a part of the new initiative, the Department will work with the U.S. Attorney’s Offices to strengthen awareness of the land use provisions of RLUIPA. The first community outreach event under the initiative will be held on June 25, in Newark, led by the U.S. Attorney’s Office for the District of New Jersey.

RLUIPA is a federal law that protects religious institutions from unduly burdensome or discriminatory land use regulations. Specifically, RLUIPA bars land use regulations that impose a substantial burden on religious exercise without a compelling justification, requires governments to treat houses of worship as favorably as nonreligious assemblies, and bars governments from discriminating among religions and from totally or unreasonably excluding houses of worship.

More information about RLUIPA and the Justice Department’s new Place to Worship Initiative is available at www.justice.gov/crt/placetoworship and at www.justice.gov/crt/rluipa. Questions and answers about RLUIPA and other documents may be found at www.justice.gov/crt/about/hce/rluipaexplain.php.

The government is represented by Assistant U.S. Attorney Michael E. Campion, Chief of the U.S. Attorney’s Office’s Civil Rights Unit, Civil Division, and Assistant U.S. Attorney Susan Millenky, Civil Division.

NEWARK, N.J. – The president of Parsippany, New Jersey-based Biodiagnostic Laboratory Services LLC (BLS) and his brother – a senior employee at the now-defunct company – were sentenced today to federal prison terms for their respective roles in a conspiracy in which millions of dollars in bribes were paid to physicians for blood sample referrals worth more than $100 million to the company, U.S. Attorney Craig Carpenito announced.

David Nicoll, 44, of Mountain Lakes, New Jersey, was sentenced to 72 months in prison; Scott Nicoll, 37, of Wayne, New Jersey, was sentenced to 43 months in prison. Each defendant had previously pleaded guilty before U.S. District Judge Stanley R. Chesler to an information charging one count of conspiracy to violate the Anti-Kickback Statute and the Federal Travel Act and one count of money laundering. Judge Chesler imposed the sentences today in Newark federal court.

“Today, the president of a diagnostic lab company and his brother were sentenced for their leading roles in a scam that led to one of the largest ever prosecutions of medical professionals in a bribery case,” U.S. Attorney Carpenito said. “Medical referrals from a doctor should be based on what’s in the patient’s best interest, not on how much money the doctor is offered in kickbacks. The number of doctors and medical professionals sent to prison in this case should make that message abundantly clear.”

The investigation has resulted in the convictions of 53 defendants – 38 of them of doctors – in connection with the bribery scheme, which its organizers have admitted involved millions of dollars in bribes and resulted in more than $100 million in payments to BLS from Medicare and various private insurance companies. It is believed to be the largest number of medical professionals ever prosecuted in a bribery case. The investigation has recovered more than $15 million through forfeiture. On June 28, 2016, BLS, which is no longer operational, pleaded guilty and was required to forfeit all of its assets.

“The FBI views health care fraud as a severe crime problem that impacts every American,” FBI Special Agent in Charge Gregory W. Ehrie said. “Fraud and abuse take critical resources out of our health care system, and contribute to the rising cost of health care for everyone. Today’s sentencing of David Nicoll and his brother Scott Nicoll are the result of a multi-agency investigation into a complex health care fraud scheme, requiring substantial investigative resources. The FBI, with its law enforcement partners, will continue to allocate a significant amount of expert resources to investigate these crimes and prosecute all those that are intent in defrauding the American public.”

“These two individuals masterminded an elaborate health care fraud scheme based on nothing more than greed,” Scott J. Lampert, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services, said. “We trust that the work with our law enforcement partners – especially the U.S. Attorney’s Office, FBI, IRS, and Postal Inspection Service – will send a clear message and dissuade individual health ‘professionals’ from making such corrosive schemes possible.”

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

On April 9, 2013, federal agents arrested BLS president and part owner, David Nicoll; Scott Nicoll, a senior BLS employee and others, who were charged by complaint with bribery conspiracy, along with the BLS company. The conspiracy made millions in illegal profits between 2006 and April of 2013. David and Scott Nicoll admitted that BLS made substantially more than $100 million from Medicare and private insurance companies – just from bills related to blood specimens sent to BLS by bribed doctors.

BLS paid doctors millions of dollars – in cash or under the guise of sham lease, service, and consulting agreements through an elaborate network of shell entities used for that purpose. The defendants also admitted that one component of the bribery scheme was to pay some doctors a fee per test to induce them to increase their ordering of certain tests.

“Health care fraud of this magnitude cannot be tolerated, and today’s sentencings are the direct result of the tremendous investigative skills of all the participating law enforcement agencies,” Bryant Jackson, Acting Special Agent in Charge, IRS - Criminal Investigation, Newark Field Office, said. “IRS - Criminal Investigation is proud to have been a part of this investigative team that helped to bring down and dismantle this massive health care conspiracy.”

“Throughout the course of this long-running investigation, Postal Inspectors, federal prosecutors and our law enforcement partners have diligently worked to unravel this elaborate bribery conspiracy,” Acting Inspector in Charge Judy Ramos of the U.S. Postal Inspection Service said. “Although, the final defendants in this matter face sentencing today, Postal Inspectors will continue to tirelessly investigate complex fraud schemes that target consumers and businesses through the U.S. Mail.”

In addition to the prison terms, Judge Chesler sentenced the Nicolls to one year of supervised release.

U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Ehrie; U.S. Department of Health and Human Services, Office of Inspector General, under the direction of Special Agent in Charge Lampert; IRS–Criminal Investigation, under the direction of Acting Special Agent in Charge Jackson, and inspectors of the U.S. Postal Inspection Service, under the direction of Acting Inspector in Charge Ramos, with the investigation leading to today’s sentencings.

The government is represented by Senior Litigation Counsel Joseph N. Minish; Assistant U.S. Attorney Danielle Alfonzo Walsman, Co-Chief of the Public Protection Unit; Jacob T. Elberg, Chief of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark; and Senior Litigation Counsel Barbara Ward of the office’s Asset Recovery and Money Laundering Unit.

Defense counsel: David Nicoll: John C. Whipple Esq., Chatham, New Jersey
Scott Nicoll: Timothy M. Donohue Esq., West Orange, New Jersey

The Justice Department today announced that it has filed a lawsuit against the Borough of Woodcliff Lake, New Jersey, alleging that the borough and its zoning board violated the Religious Land Use and Institutionalized Persons Act of 2000 (RLUIPA) when it denied zoning approval to allow the Valley Chabad, an Orthodox Jewish congregation located in Woodcliff Lake, to build a new place of worship on its land in the borough.

The complaint, filed in the District of New Jersey, alleges that Woodcliff Lake’s denial of a variance imposed a substantial burden on the Valley Chabad’s religious exercise. The complaint alleges that between 2005 and 2013, the Valley Chabad sought to purchase three different sites in the borough to construct a place of worship, and that the borough took steps to thwart each attempt. The complaint also alleges that after nine years of searching for a suitable location, in 2014 the Valley Chabad sought to construct a larger place of worship at its current location in the borough. After two years, 18 hearings, and substantial revisions by Valley Chabad to address size and transportation concerns, the zoning board denied the application. The zoning board cited aesthetic concerns, the adverse impact on the “residential character of the neighborhood,” and safety issues that were undermined by the testimony of the zoning board’s own experts.

“The right to use land for religious exercise, free from unduly burdensome or discriminatory restrictions, is a fundamental constitutional right,” said Acting Assistant Attorney General John Gore. “The Department of Justice remains vigilant in its enforcement of federal civil rights laws protecting religious groups’ ability to establish places of worship without improper interference.”

“Federal law protects all religious communities from discrimination and unlawful barriers when they seek to build a place of worship,” said New Jersey U.S. Attorney Craig Carpenito. “According to the complaint, the Borough of Woodcliff Lake imposed a substantial burden on Valley Chabad’s religious freedom by repeatedly meddling in its attempts to purchase property in the area and citing subjective and misleading reasons to justify denying its zoning application.”

The Department of Justice today announced the “Place to Worship Initiative,” which will focus on protecting the ability of houses of worship and other religious institutions to build, expand, buy, or rent facilities—as provided by the land use provisions of the RLUIPA. As a part of the new initiative, the Department will work with the United States Attorney’s Offices to strengthen awareness of the land use provisions of RLUIPA.

RLUIPA is a federal law that protects religious institutions from unduly burdensome or discriminatory land use regulations. Specifically, RLUIPA bars land use regulations that impose a substantial burden on religious exercise without a compelling justification, requires governments to treat houses of worship as favorably as nonreligious assemblies, and bars governments from discriminating among religions and from totally or unreasonably excluding houses of worship.

More information about RLUIPA and DOJ’s new Place to Worship Initiative is available at www.justice.gov/crt/placetoworship and at http://www.justice.gov/crt/rluipa.

The government in this case is represented by Assistant U.S. Attorney Michael E. Campion, Chief of the U.S. Attorney’s Office’s Civil Rights Unit, Civil Division, and Assistant U.S. Attorney Susan Millenky, Civil Division.

TRENTON, N.J. - A Closter, New Jersey, man today admitted producing and selling fraudulent massage therapy training certificates for use in various New Jersey massage parlors that engaged in prostitution, U.S. Attorney Craig Carpenito announced.

Naresh Rane, 64, pleaded guilty before Senior U.S. District Judge Anne E. Thompson to Count 1 of an indictment charging him with knowingly and intentionally using and causing the use of facilities in interstate commerce to promote, manage, establish, carry on, and facilitate the business of prostitution in violation of New Jersey law.  

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

 Rane owned and operated Axiom Healthcare Academy, which purported to provide classes in massage therapy training. Rane held himself out as a businessman who, for a fee that ranged from $1,000 to $2,600, could provide massage therapy training certificates to anyone who wished to obtain a massage license without the required training. Rane was also willing to provide phony transcripts listing classes and grades.

Between November 2013 and March 2014, Rane provided 10 fraudulent massage therapy training certificates and transcripts to a former Westwood, New Jersey, councilman who then gave them to prostitutes working in different massage parlors located in Union, Passaic, Hudson and Middlesex Counties. Rane admitted today that he knew the documents he was producing and selling were used to disguise prostitution activities as legitimate massage services.  

The charge to which Rane pleaded guilty carries a maximum potential penalty of five years in prison and a $250,000 fine. Sentencing is scheduled for Oct. 2, 2018.   

U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark, with the investigation leading to today’s guilty plea.

The government is represented by Senior Litigation Counsel Mark J. McCarren of the U.S. Attorney’s Office Special Prosecutions Division in Newark.

Defense counsel: David A. Schwartz Esq., Eatontown

CAMDEN, N.J. – An Atlantic County, New Jersey, man was arrested and charged today with receiving and distributing images of child sexual abuse, U.S. Attorney Craig Carpenito announced.

Carlos Santiago Gomez, 27, of Absecon, New Jersey, turned himself in at the Atlantic City Resident Office of the FBI this morning after returning from a business trip to Texas. He is charged by complaint with one count of receiving child pornography and one count of distributing child pornography. Santiago Gomez made his initial appearance before U.S. Magistrate Judge Ann Marie Donio in Camden federal court.

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

From April 2016 through March 27, 2018, Santiago Gomez allegedly viewed, received and distributed images of child sexual abuse, including images of prepubescent children. Santiago Gomez, who was employed in the IT field, administered a KIK group in which participants traded images and videos of child sexual abuse. (KIK is an instant messaging app). While administering the group, Santiago provided instructions, including:  

“New comers, welcome. There are just some rules to keep in mind when posting and maintaining your position. 1. Girls only 2. No Toddler 3. Videos only, no links no pictures. 4. Goes without saying but be active. Thanks and enjoy.”

“Please don’t post adult videos.”

“If you’re using FREENET, you might as well call the cops and turn yourself in. TOR, though not 100% safe by default, is slow but way better than FREENET.”

On March 27, 2018, law enforcement officers searched Santiago Gomez’ residence and seized numerous computers and electronic devices, including Santiago Gomez’ cellular telephone. Although law enforcement officers have not yet fully completed their analysis of Santiago’s electronic devices, agents have uncovered more than 1,000 images and videos of child sexual abuse. 

Each count of receiving or distributing child pornography carries a mandatory minimum sentence of five years in prison, a maximum potential penalty of 20 years in prison, and a $250,000 fine. 

U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie; and the Atlantic County Prosecutor’s Office, under the direction of Prosecutor Damon G. Tyner, with the investigation leading to today’s charge and arrest.

The government is represented by Assistant U.S. Attorney Diana Vondra Carrig of the U.S. Attorney’s Office Criminal Division in Camden.

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

NEWARK, N.J. – The leader of one of Newark’s most violent street gangs was sentenced today to 540 months in prison for his admitted role in five murders, an armed carjacking, an armed robbery of a drug dealer, two counts of assault with a deadly weapon, and drug conspiracy as part of a racketeering conspiracy involving the South Side Cartel, U.S. Attorney Craig Carpenito announced.

Farad Roland, 33, previously pleaded guilty before U.S. District Judge Esther Salas to violations of the Racketeer Influenced and Corrupt Organizations Act (RICO) as part of a 27-count second superseding indictment. Judge Salas imposed the sentence today in Newark federal court.

“This sentence effectively ends Farad Roland’s reign as the leader of the South Side Cartel.” U.S. Attorney Carpenito said. “Working with our partners in the FBI, the Newark Department of Public Safety, and the Essex County Prosecutor’s Office, we have removed a dangerous and violent predator from the streets of Newark, making the city safer for everyone. Stopping violent crime is a top priority of this office, and this sentence should be a warning to those who traffic in illegal drugs and commit acts of violence in support of their criminal enterprises that the office will take action to ensure that they will no longer walk free to terrorize their community.”

“Farad Roland chose to kill for the South Side Cartel of the Newark Bloods and now he can serve time for the gang,” Newark FBI Special Agent in Charge Gregory W. Ehrie said. “This conduct will not be tolerated and today’s sentence should send a message that the FBI, together with our law enforcement partners, will pursue and prosecute members of violent street gangs who seek to inflict violence and fear in our communities. The FBI and our partners will aggressively pursue gangs wherever they surface and are steadfast to making Newark and the surrounding communities, a safe place for our citizens.”

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

The South Side Cartel was a sub-set of the Bloods street gang that operated primarily on Hawthorne Avenue in Newark. Originally a neighborhood-based gang whose main activities were selling drugs and committing violent acts to aid the drug-trafficking business, many of the gang’s members were officially brought into the Bloods gang in 2002 and 2003. The gang often operated out of apartments located at 496-500 Hawthorne Avenue, which were dubbed “the Twin Towers.” Local law enforcement made repeated narcotics and gun arrests at this location. Many of the South Side Cartel members had tattoos showing the Twin Towers and the logo “SSC,” which represented the gang’s initials.

Between 2003 and 2010, the South Side Cartel was generally known among law enforcement and the FBI as the most violent street gang in Newark, committing numerous murders, shootings, robberies and other violent acts in furtherance of the enterprise. At its peak, the South Side Cartel had about 20 members or associates, many of whom have since been killed in gang-related murders or who are serving prison sentences for gang-related crimes. Roland’s two co-defendants, Malik Lowery and Mark Williams, previously pleaded guilty in federal court. Lowery was sentenced in August 2016 to more than 26 years in federal prison. Williams is scheduled to be sentenced Sept. 13, 2018.

Roland’s admission of guilt includes acknowledgement of his participation in a host of racketeering acts to further the South Side Cartel’s goals, including:

• The Feb. 20, 2005, murder of a Newark resident who was shot during a robbery attempt that Roland ordered one of his gang associates to carry out; • The Feb. 23, 2005, murder of the 19-year-old gang associate who committed the Feb. 20, 2005 robbery-murder, to prevent him from cooperating with law enforcement and implicating Roland; • The Oct. 20, 2007, murder of a fellow South Side Cartel member who had fallen into disfavor with the gang; • The retaliation murders of two people on March 27, 2008, outside the Oasis Bar located on Lyons Avenue in Newark.

Roland also admitted committing an armed carjacking; an assault with a dangerous weapon in the 2008 shooting of a fellow gang member with whom Roland had a dispute; an assault with a dangerous weapon in the 2009 shooting of a rival gang member; the armed robbery of a drug dealer in East Orange, New Jersey; and conspiracy to distribute more than a kilogram of heroin and 280 grams of crack cocaine.

In addition to the prison term, Judge Salas sentenced Roland to five years of supervised release.

U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Ehrie; the Newark Police Division, under the direction of Department of Public Safety Director Anthony F. Ambrose; and Acting Essex County Prosecutor Robert D. Laurino, with the investigation leading to today’s sentencing.

The government is represented by Senior Litigation Counsel Robert Frazer of the Violent Crimes Unit, Assistant U.S. Attorney Courtney Howard of the Economic Crimes Unit and Assistant U.S. Attorney Desiree Grace Latzer of the Violent Crimes Unit.

Defense counsel: Farad Roland: Richard Jasper Esq. and Michael Bachrach Esq., New York; and Stephen Turano Esq., Newark

NEWARK N.J. – Two Essex County, New Jersey, men charged with multiple drug and weapons offenses were convicted today on all counts, U.S. Attorney Craig Carpenito announced.

Jesse Tullies, 53, of Hillside, New Jersey, and Eugene Williams, 33, of Newark, were convicted on one count each of conspiracy to distribute heroin, distribution of heroin, distribution of cocaine base, being a felon in possession of a weapon, and use and carrying of a firearm in furtherance of a drug trafficking crime. The defendants were convicted following a three-day trial before U.S. District Judge Kevin McNulty in Newark federal court. The jury deliberated three hours before returning the guilty verdicts.

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

On Oct. 4, 2017, Essex County Sheriff’s Officers witnessed Tullies and Williams involved in what they believed were a number of illegal drug sales in the area of Clinton Place and Weequahic Avenue in Newark. Tullies and Williams were subsequently arrested and during a search, officers recovered $1,275 in cash from Tullies and $360 from Williams. 

During a search of the area where officers had seen Tullies and Williams retrieve suspected narcotics from under the rear bumper of a car, detectives recovered the following items:

• One plastic bag containing 198 glassine envelopes containing suspected heroin, including four glassine envelopes stamped “Black Jack”;

• One plastic bag containing 22 smaller plastic bags and ten plastic jugs containing suspected cocaine base and cocaine;

• A 9mm Beretta NaNa semiautomatic handgun loaded with two rounds of 9mm ammunition;

• A 9mm Taurus Millennium PT111 G2 semiautomatic handgun loaded with eight rounds of Sig Sauer 9mm ammunition and four rounds of Winchester 9mm ammunition;

• A 9mm FEG PA-63 Makarov semiautomatic handgun loaded with two rounds of JSC Barnaul Machine Tool Plant 9mm hollow point ammunition.

Laboratory testing confirmed that the substances recovered from under the rear bumper of the Chevrolet Lumina were heroin and crack cocaine.

Each of the drug counts on which the defendants were convicted carries a maximum penalty of 20 years in prison. The felon in possession of a weapon counts carry a maximum penalty of 10 years in prison. The use of a firearm counts carry a consecutive mandatory minimum of five years in prison and a maximum of life in prison. Sentencing is scheduled for Oct. 4, 2018.

U.S. Attorney Carpenito credited special agents of the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the direction of Special Agent in Charge John Devito in Newark; special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark; and officers of the Essex County Sheriff’s Office, under the direction of Sheriff Armando B. Fontoura, with the investigation leading to today’s convictions.

The government is represented by Assistant U.S. Attorneys Francisco Navarro of the National Security Unit and Elaine Lou of the Organized Crime/Gangs Unit in Newark.

NEWARK, N.J. – A Hunterdon County, New Jersey, woman today admitted stealing outstanding customer refund checks and failing to report that income on her individual tax returns, U.S. Attorney Craig Carpenito announced.

Salomé Woolford, 49, of Lebanon, New Jersey, pleaded guilty before U.S. District Judge Claire C. Cecchi in Newark federal court to an information charging her with one count of conspiracy to commit wire fraud and one count of filing a false income tax return.

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

Between May 2014 and April 2015, while working as a customer service representative for the victim company, Woolford and other employees devised a scheme to steal money by identifying outstanding refund checks that had not yet been cashed. Woolford and others then accessed the accounts for those customers in the victim company’s computer system, electronically changed the payee information to that of one of their associates and requested new checks.

As a result, the victim company reissued the refund checks in the name of the new payees. Once the checks had been received and cashed, Woolford and others changed the payee information back to the original customers’ information to conceal the fraud. As a result of the scheme, the victim company suffered losses of at least $300,000.

Woolford failed to report the money she received as part of the scheme on her tax returns for years 2013 through 2015.
 
The wire fraud conspiracy charge carries a maximum potential penalty of 20 years in prison and a $250,000 fine. The false tax filing charge carries a maximum potential penalty of three years in prison and a $250,000 fine. As part of her plea agreement, Woolford must also pay restitution to the victim company. Sentencing is scheduled for Oct. 17, 2018.

U.S. Attorney Carpenito credited inspectors of the U.S. Postal Inspection Service, Newark Division, under the direction of Acting Inspector in Charge Judy Ramos, and special agents of IRS–Criminal Investigation, under the direction of Acting Special Agent in Charge Bryant Jackson in Newark, with the investigation leading to today’s plea.

The government is represented by Assistant U.S. Attorney Sammi Malek of the U.S. Attorney’s Office Criminal Division in Newark.

Defense counsel: Keith Hirschorn Esq., Hoboken, New Jersey

TRENTON, N.J. – An Egg Harbor Township man was arrested by federal agents today for allegedly receiving images of child sexual abuse, U.S. Attorney Craig Carpenito announced.

Matthew Wolny, 40, is charged by complaint with two counts of receiving child pornography. Wolny is expected to appear this afternoon before U.S. Magistrate Judge Lois H. Goodman in Trenton federal court.

According to the complaint:

In September 2013, Wolny, who was then living in Jackson, New Jersey, used peer to peer file sharing software on his computer to download video files containing images of child sexual abuse from the internet. When law enforcement officers searched Wolny's Jackson residence and his car in September 2013, they seized numerous electronic devices containing approximately 2,000 images and 1,600 videos of suspected child pornography.

Each charge of receiving child pornography carries a mandatory minimum sentence of five years in prison, a maximum potential penalty of 20 years in prison, and a $250,000 fine.

U.S. Attorney Carpenito credited special agents of Department of Homeland Security, Homeland Security Investigations, under the direction of Acting Special Agent in Charge Brian Michael, and the Ocean County Prosecutor’s Office, under the direction of Prosecutor Joseph D. Coronato, with the investigation. He also thanked the Little Egg Harbor Police Department, under the direction of Chief Richard J. Buzby Jr, for its assistance.

The government is represented by Assistant U.S. Attorney Molly Lorber of the Criminal Division in Trenton.

CAMDEN, N.J. – The former president and CEO of Concord Chemical Co. Inc. (Concord) today admitted illegally storing hazardous waste, U.S Attorney Craig Carpenito announced.

Miguel Castillo, 63, of Hilton Head, South Carolina, pleaded guilty before Judge Joseph H. Rodriguez to one count of storing hazardous waste at Concord’s Camden, New Jersey, facility in violation of the Resource Conservation and Recovery Act (RCRA).

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

RCRA was enacted in 1976 to address a growing nationwide problem with industrial and municipal waste. RCRA was designed to protect human health and the environment by prohibiting the treatment, storage or disposal of any hazardous waste without a permit.

During its operation, Concord manufactured, repackaged and distributed a wide variety of chemical products, including cresylic acid, soaps, waxes, pipe lubricants and emulsions. Some of Concord’s products and the raw materials used to make them were hazardous. Castillo was Concord’s president or CEO from at least 2004 through August 2011.

As president and CEO, Castillo’s responsibilities included making decisions about the disposal of waste at the Camden facility. From at least 2005 through August 2010, Castillo knew that there were containers that stored hazardous waste at the Camden facility and that Concord did not have a permit to store such waste.

In August 2010, the U.S. Environmental Protection Agency (EPA) conducted a site visit of the Camden facility and discovered that the facility was devoid of employees, abandoned in a deteriorated condition and filled with drums containing corrosive and ignitable hazardous waste. From October 2010 through March 2011, the EPA removed the hazardous substances from the facility.

The illegal storage of hazardous waste charge carries a maximum penalty of five years in prison and a $250,000 fine, or twice the gain or loss caused by the offense. Castillo’s sentencing is set for Sept. 10, 2018.

U.S. Attorney Carpenito credited special agents of the EPA, under the direction Special Agent in Charge Tyler Amon, with the investigation leading to today’s guilty plea.

The government is represented by Assistant U.S. Attorney Kathleen P. O’Leary of the U.S. Attorney's Office Health Care and Government Fraud Unit in Newark.

Defense counsel: Lisa Lewis Esq., Assistant Federal Public Defender, Camden

NEWARK, N.J. – A Newark man who was arrested following a domestic disturbance in which he discharged his weapon pleaded guilty today to possessing a firearm as a previously convicted felon, U.S. Attorney Craig Carpenito announced.

Dequan Farlow, 37, pleaded guilty before U.S. District Judge Stanley R. Chesler in Newark federal court to an indictment charging him with one count of possession of a firearm as a previously convicted felon.

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

Farlow was arrested by Newark police officers on June 30, 2017 after he allegedly shot a speaker next to his ex-girlfriend’s mother and struck the mother with the gun at her residence in Newark.

Farlow admitted today that he knowingly possessed a loaded Hi-Point JCP semi-automatic handgun, despite having at least one prior felony conviction in Essex County Superior Court. As part of his plea agreement, Farlow also acknowledged that he knowingly fired the gun on June 30, 2017.

The felon in possession of a firearm charge carries a maximum potential penalty of 10 years in prison and a $250,000 fine. Sentencing will be scheduled at a later date.

U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark, with the investigation. He also thanked officers of the Newark Police Division, under the direction of Department of Public Safety Director Anthony F. Ambrose, for their assistance.

The government is represented by Assistant U.S. Attorney Jason S. Gould of the U.S. Attorney’s Office Criminal Division in Newark.

Defense counsel: Patrick McMahon Esq., Assistant Federal Public Defender, Newark

NEWARK, N.J. – Two Customs and Border Protection (CBP) officers were indicted and another pleaded guilty for their roles in the assaults of two fellow CBP officers at Newark Liberty International Airport, U.S. Attorney Craig Carpenito announced today.

Parmenio I. Perez, 40, of Hawthorne, New Jersey, and Michael A. Papagni, 32, of Staten Island, New York, were charged by indictment today with two counts of forcibly assaulting, impeding, intimidating, and interfering with two CBP officers, identified in court documents as “Victim One” and “Victim Two,” while the victims were engaged in their duties as CBP officers. They will be arraigned at a later date.

Tito Catota, 38, of Lyndhurst, New Jersey, pleaded guilty June 4, 2018, before Senior U.S. District Judge Katharine S. Hayden in Newark federal court to an information charging him with two counts of forcibly assaulting, impeding, intimidating, and interfering with Victim One and Victim Two while they were engaged in their duties as CBP officers. All three defendants were originally arrested and charged by complaint in September 2017.

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

Catota, Perez, and Papagni were employed as CBP officers at Newark Liberty International Airport and were assigned to the Passenger Enforcement Rover Team (PERT). PERT was a CBP specialized unit that identified and intercepted passengers attempting to bring contraband into the United States or who might be associated with terrorist activities. PERT maintained an office on the second floor of Terminal C at Newark Liberty International Airport.

Victim One was assigned to PERT in October 2016. Within the first two weeks that Victim One worked in PERT, Papagni allegedly advised Victim One that the PERT office table was known as the “rape table” and threatened the victim that he would get him on it.

On Jan. 10, 2017, an individual identified in court documents as “CBPO 2” shut off the lights in the PERT office. Papagni, Catota, and another officer identified as “CBPO 3” grabbed Victim One’s arms and legs and threw him on top of the PERT office table. While Papagni, Catota, and CBPO 3 held him down, Perez got on top of Victim One’s mid-section and grinded his body up and down against Victim One’s genitals through the victim’s clothing in a motion simulating a sex act. Victim One unsuccessfully attempted to push Perez off his body. When Perez got off of Victim One, Papagni, Catota, and CBPO 3 released him.

On Nov. 30, 2016, Victim Two, who was assigned to the Port Director staff, went to the PERT office to speak to CBPO 1. A few minutes later, an officer identified as “CBPO 4” locked one of the doors to the office. Catota, Papagni, and Perez then grabbed Victim Two and threw him on his side on the PERT office table. Perez then allegedly simulated a sex act on Victim 2’s leg. Victim Two struggled to get free until Catota, Papagni, and Perez eventually released him.

At his plea hearing, Catota admitted that he and other CBP officers referred to the tables in the PERT office as the “rape table.” Catota also admitted helping grab Victim One and Victim Two, throwing them on the tables, and holding them down while they were attacked. In addition, Catota also admitted that he and other CBP officers discussed the assaults on the Whatsapp chat message service. For instance, on Dec. 7, 2016, Catota stated that another CBP officer had “walked out on the rape” when referring to the assault of Victim Two.

The charges against Perez, Papagni, and Catota each carry a maximum potential penalty of eight years in prison and a $250,000 fine.

The charges and allegations against Perez and Papagni are merely accusations, and they are considered innocent unless and until proven guilty.

U.S. Attorney Carpenito credited special agents with the U.S. Department of Homeland Security, Office of Inspector General, New York Resident Office, under the direction of Special Agent in Charge Mark Tasky and U.S. Customs and Border Protection, Office of Professional Responsibility, New York Resident Office, under the direction of Special Agent in Charge Vance Kuhner, with the investigation leading to the indictment and guilty plea.

The government is represented by Senior Litigation Counsel Leslie Faye Schwartz of the U.S. Attorney’s Office’s Special Prosecutions Division, and Rahul Agarwal, Deputy Chief of the Criminal Division in Newark.

Catota: Alan Zegas Esq., Chatham, New Jersey
Papagni: Chad Seigel Esq., New York
Perez: Lorraine Gauli-Rufo, Verona, New Jersey

CAMDEN, N.J. – A mother who was arrested and charged along with her son for their alleged roles in a drug trafficking conspiracy appeared in Camden federal court today for a detention hearing, U.S. Attorney Craig Carpenito announced.

Candace Gottlieb, 59, of Cherry Hill, New Jersey, is charged by complaint with conspiracy to distribute and possess with intent to distribute fentanyl, heroin, cocaine, and marijuana. Following her appearance, she was detained without bail. Her son, Tyler Gottlieb, 27, was arrested in California and is charged by complaint with conspiracy to distribute and possess with intent to distribute fentanyl, heroin, cocaine, and marijuana.

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

Candace Gottlieb and her son were arrested following a federal investigation into trafficking counterfeit prescription opioid pills containing fentanyl and heroin, as well as cocaine and marijuana. In March 2018, federal law enforcement officers seized $67,760 from Tyler Gottlieb as he was about to board a flight to California from Philadelphia International Airport. In the months that followed, the FBI obtained 802 counterfeit prescription pills from Tyler and Candace Gottlieb, 200 of which have been confirmed to contain fentanyl and heroin. The remaining pills are believed to also contain fentanyl and heroin. The FBI also allegedly purchased cocaine in a transaction orchestrated by Tyler Gottlieb, seized approximately 40 pounds of marijuana sent by Tyler Gottlieb to New Jersey through the mail, and obtained samples of cocaine and marijuana from Candace Gottlieb.

On June 1, 2018, federal and local law enforcement executed a search warrant at Tyler and Candace Gottlieb’s New Jersey residence and seized approximately 6,600 additional counterfeit prescription pills suspected of containing fentanyl and heroin, along with cocaine and marijuana packaged for distribution. Investigators also located and seized two handguns from inside the home and approximately $2,000 in cash.

In the early morning hours of June 2, 2018, federal and local law enforcement executed a second search warrant at another residence connected to Tyler Gottlieb. During that search, investigators seized six more firearms, including an AK-47 assault rifle, a shotgun, 1,000 rounds of ammunition, high-capacity ammunition magazines, and two handguns. Investigators also seized marijuana and packaging materials.

Candace Gottlieb was arrested on June 1, 2018, in conjunction with the search of her home and was detained following her arrest. Federal and local law enforcement arrested Tyler Gottlieb in California on June 1, 2018. Tyler Gottlieb is awaiting an appearance in federal court in California with an anticipated appearance to follow in New Jersey on a date yet to be determined.

The drug trafficking conspiracy charges carry a maximum potential penalty of 20 years in prison and a $5 million fine.

U.S. Attorney Carpenito credited special agents of the FBI’s South Jersey Violent Offender and Gang Task Force, South Jersey Resident Agency, under the direction of Special Agent in Charge Michael Harpster; special agents of the Bureau of Alcohol, Tobacco, Firearms, and Explosives, under the direction of Special Agent in Charge John Devito; postal inspectors with the U.S. Postal Inspection Service, under the direction of Daniel Brubaker, Philadelphia Division; the Camden County Sherriff’s Department, under the direction of Gilbert Wilson; the Camden County Police Department, under the direction of Chief J. Scott Thomson; and the Camden County Prosecutor’s Office, under the direction of Prosecutor Mary Eva Colalillo.

He also thanked the Cherry Hill Police Department, under the direction of William Monaghan, the Pennsauken Police Department, under the direction of John Coffey, and special agents of U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI), under the direction of Acting Special Agent in Charge Brian Michael.

The government is represented by Assistant U.S. Attorney Gabriel J. Vidoni of the U.S. Attorney’s Office Criminal Division in Camden.

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

Defense counsel: Candace Gottlieb: Christopher O’Malley Esq., Camden
Tyler Gottlieb: Evan Hughes Esq., Philadelphia

NEWARK, N.J. – A Bayonne, New Jersey, man was sentenced today to 480 months in prison for producing and possessing images and videos of child sexual abuse, U.S. Attorney Craig Carpenito announced.

Gregory John Schaffer, 39, was previously found guilty on all three counts of an indictment charging him with two counts of production of child pornography and one count of possession of child pornography. He was convicted following a three-day trial before U.S. District Judge Jose L. Linares, who imposed the sentence today in Newark federal court.

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

In 2010, Schaffer sexually abused a 12-year-old girl in a tow-truck office in Union City, New Jersey, and video recorded the abuse without her knowledge. He later stored the video recording on a laptop computer found by law enforcement in his office in Jersey City, New Jersey. Schaffer also backed-up the video recording to another electronic storage device found in his office.

Around the same time, Schaffer also sexually abused a 14-year-old girl in a hotel room and video recorded the abuse without her knowledge. Schaffer again stored the video recording on the same laptop computer and electronic storage device that law enforcement found in his office.

Law enforcement also found additional sexually explicit videos and images of minors on Schaffer’s laptop computer and electronic storage device.

In addition to the prison term, Judge Linares sentenced Schaffer to lifetime supervised release.

U.S. Attorney Carpenito credited special agents of the U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI), New York Field Office under the direction of Special Agent in Charge Angel M. Melendez; special agents of the U.S. Secret Service, under the direction of Special Agent in Charge David E. Beach, New York Field Office; and the Hudson County Prosecutor’s Office, under the direction of Prosecutor Esther Suarez, with the investigation leading to today’s sentencing.

The government is represented by Assistant U.S. Attorneys Jason S. Gould and Meredith Williams of the U.S. Attorney’s Office Criminal Division in Newark.

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Defense counsel: Thomas Ambrosio Esq., of Lyndhurst, New Jersey

An Elizabeth, New Jersey, biodiesel fuel company pleaded guilty today to discharging over 45,000 gallons of wastewater from its commercial biodiesel fuel production into the Arthur Kill, a narrow waterway that separates New Jersey from Staten Island, New York, U.S. Attorney Craig Carpenito and Acting Assistant Attorney General Jeffrey H. Wood announced.

Fuel Bio One LLC pleaded guilty before U.S. District Court Judge William J. Martini to an information charging it with one count of violating the Clean Water Act, a statute that was enacted to prevent, reduce, and eliminate water pollution in the United States.

According to court documents, Fuel Bio One generated wastewater that included methanol, biodiesel and other contaminants, as a byproduct of its biodiesel fuel production at its Elizabeth, New Jersey, plant. On September 6, 2013, and November 9, 2013, employees of Fuel Bio One released a total of approximately 45,000 gallons of wastewater into a storm water pit at the Elizabeth plant, causing the pump to operate and, as a result, wastewater to be discharged into the Arthur Kill. A representative of Fuel Bio One admitted to this conduct in court today.

Fuel Bio One has agreed, as part of its plea agreement, to pay $100,000 and to be placed on a probationary term of five years. During the probation, the company will be required to provide to the court biannual reports of any waste it generates and the steps taken to properly dispose of such waste. Fuel Bio One will also be required to develop an employee training program to ensure that all storage, treatment and disposal of wastewater complies with the Clean Water Act and any other applicable laws. The company will also be required to provide the U.S. Environmental Protection Agency full access to all offices, warehouses and facilities.

“Staten Island Sound (also known as the Arthur Kill) is a vital waterway running between New Jersey and Staten Island. Once heavily polluted and nearly devoid of marine life, this waterbody is making a comeback and again provides habitat to many species of fish and wildlife,” said Acting Assistant Attorney General Jeffrey H. Wood for the Justice Department’s Environment and Natural Resources Division.   “Illegal dumping of pollution into the Sound not only violates federal law, but also threatens the environmental recovery of this historic marine channel, which is important to New Yorkers and New Jerseyans alike. The Justice Department will continue to work closely with EPA Criminal Investigation Division to prosecute illegal actions like those in this case.”

“Protecting the environment and our natural resources is one of the many ways this office works to keep New Jersey safe for everyone,” said U.S. Attorney Carpenito for the District of New Jersey. “Today’s prosecution and guilty plea ensures that Fuel Bio One will be punished for its past crimes, and the plea agreement puts into place a plan to make sure they don’t pollute our waterways in the future.”

“Fuel Bio One undercuts a level playing field when they illegally discharge polluted wastewater into the Arthur Kill without any regulatory approval,” said Special Agent in Charge Tyler Amon of EPA’s Criminal Investigation Division in New Jersey. “This judicial action demonstrates EPA’s commitment to protecting New Jersey’s environment and ensuring that all companies play by the rules to keep pollutants from the state’s natural resources.”

U.S. Attorney Carpenito and Acting Assistant Attorney General Wood credited special agents of the U.S. Environmental Protection Agency, under the direction of Special Agent in Charge Tyler Amon, with the investigation leading to today’s charges. 

The Government is represented by Assistant United States Attorney Kathleen P. O'Leary of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark and Adam Cullman of the Environmental Crimes Section of the United States Department of Justice.

NEWARK, N.J. – An Elizabeth, New Jersey, biodiesel fuel company today admitted discharging more than 45,000 gallons of wastewater from its commercial biodiesel fuel production facility into the Arthur Kill, a narrow waterway that separates New Jersey from Staten Island, New York, U.S Attorney Craig Carpenito and Acting Assistant Attorney General Jeffrey H. Wood announced.

Fuel Bio One LLC pleaded guilty before U.S. Magistrate Judge James B. Clark 3rd to an information charging it with one count of violating the Clean Water Act, a statute that was enacted to prevent, reduce, and eliminate water pollution in the United States.

“Protecting the environment and our natural resources is one of the many ways this office works to keep New Jersey safe for everyone,” U.S. Attorney Carpenito said. “Today’s prosecution and guilty plea ensures that Fuel Bio One will be punished for its past crimes, and the plea agreement puts into place a plan to make sure they don’t pollute our waterways in the future.”

“Staten Island Sound (also known as the Arthur Kill) is a vital waterway running between New Jersey and Staten Island. Once heavily polluted and nearly devoid of marine life, this waterbody is making a comeback and again provides habitat to many species of fish and wildlife,” Acting Assistant Attorney General Jeffrey H. Wood for the Justice Department’s Environment and Natural Resources Division said. “Illegal dumping of pollution into the Sound not only violates federal law, but also threatens the environmental recovery of this historic marine channel, which is important to New Yorkers and New Jerseyans alike. The Justice Department will continue to work closely with EPA Criminal Investigation Division to prosecute illegal actions like those in this case.”

“Fuel Bio One undercuts a level playing field when they illegally discharge polluted wastewater into the Arthur Kill without any regulatory approval,” Special Agent in Charge Tyler Amon of EPA’s Criminal Investigation Division in New Jersey said. “This judicial action demonstrates EPA’s commitment to protecting New Jersey’s environment and ensuring that all companies play by the rules to keep pollutants from the state’s natural resources.”

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

Fuel Bio One generated wastewater that included methanol, biodiesel and other contaminants, as a byproduct of its biodiesel fuel production at its Elizabeth, New Jersey, plant. On September 6, 2013, and November 9, 2013, employees of Fuel Bio One released a total of approximately 45,000 gallons of wastewater into a storm water pit at the Elizabeth plant, causing the pump to operate and, as a result, wastewater to be discharged into the Arthur Kill. A representative of Fuel Bio One admitted to this conduct in court today.

Fuel Bio One has agreed, as part of its plea agreement, to pay $100,000 and to be placed on a probationary term of five years. During the probation, the company will be required to provide to the court biannual reports of any waste it generates and the steps taken to properly dispose of such waste. Fuel Bio One will also be required to develop an employee training program to ensure that all storage, treatment and disposal of wastewater complies with the Clean Water Act and any other applicable laws. The company will also be required to provide the U.S. Environmental Protection Agency full access to all offices, warehouses and facilities.

U.S. Attorney Carpenito and Acting Assistant Attorney General Wood credited special agents of the U.S. Environmental Protection Agency, under the direction Special Agent in Charge Amon, with the investigation leading to today’s guilty plea.

The Government is represented by Assistant U.S. Attorney Kathleen P. O'Leary of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark and Adam Cullman of the Environmental Crimes Section of the U.S. Department of Justice.

Defense counsel: Christopher Adams Esq., Roseland, New Jersey

NEWARK, N.J. – A Harrisburg, Pennsylvania, man was sentenced today to 60 months in prison for his role in a scheme that fraudulently obtained more than $24 million from the Post 9/11 GI Bill, a federal education benefits program designed to help veterans who served in the armed forces following the terrorist attacks on Sept. 11, 2001, U.S. Attorney Craig Carpenito announced.

David Alvey, 51, previously pleaded guilty before U.S. District Judge Katharine S. Hayden to an information charging him with one count of conspiracy to commit wire fraud. Judge Hayden imposed the sentence today in Newark federal court.

“Today’s sentence is an appropriate punishment for a man who spent years cheating our veterans by stealing millions in tax payer funds reserved for their education,” said U.S. Attorney Carpenito. “Instead of receiving the quality instruction they were promised, thousands of service men and women recruited by Ed4Mil were enrolled in unapproved online courses without their knowledge. No veteran should be treated this way.”

“The VA’s Post 9/11 GI Bill is an invaluable and comprehensive education program meant to advance our nation’s veteran’s educational and professional lives as they transition to civilian life,” said Special Agent in Charge Sean Smith, U.S. Department of Veterans Affairs, Office of Inspector General, Northeast Field Office. “The successful prosecution of those who defraud this important program sends a clear message that those who seek to do VA harm will be pursued and prosecuted. VA OIG is committed to working closely with our fellow law enforcement and DOJ partners, and grateful for their efforts in pursuing justice in this matter”

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

The Post-9/11 GI Bill provides educational assistance to eligible veterans of the U.S. Armed Forces by paying for veterans’ tuition, housing costs, and other educational expenses as long as their courses meet certain criteria. Because these tuition benefits are paid by the United States directly to the school, all entities involved in developing and administering the courses must be fully disclosed to the United States in order to assess the courses for approval.

From 2009 through August 2013, Alvey – founder and president of Ed4Mil – along with Lisa DiBisceglie and Helen Sechrist, both of whom previously pleaded guilty to a similar wire fraud conspiracy count, and others, conspired to fraudulently obtain millions of dollars in tuition assistance and other education-related benefits under the Post-9/11 GI Bill.

DiBisceglie, then an associate dean at Caldwell University, helped Alvey get approval from Caldwell’s administration to develop and administer a series of non-credit online courses for veterans in Caldwell’s name. In order for the courses to be eligible for education benefits under the Post-9/11 GI Bill, DiBisceglie, Alvey, and others prepared and submitted an application with the Veterans Administration stating that the courses were developed, taught, and administered by Caldwell faculty and met Caldwell’s stringent educational standards. The courses were subsequently approved, and Alvey, Sechrist, and others aggressively marketed the courses to veterans who were eligible to receive the benefits.

However, Caldwell did not participate in developing or teaching the online courses. The veterans were instead enrolled in online correspondence courses developed and administered by a sub-contractor of Ed4Mil. Neither Ed4Mil nor its sub-contractor were disclosed to the government, and neither were eligible to receive Post-9/11 GI Bill benefits.

Alvey and others concealed the true nature of the courses from the government and the veterans who enrolled in the courses. Thousands of veterans enrolled in the online courses believing they were taking courses from Caldwell. The scheme caused the United States to pay more than $24 million in tuition benefits under the Post-9/11 GI Bill.

“Today's action should serve as a warning to anyone who intentionally steals or misappropriates federal student aid for their own selfish purpose: you will be caught and held accountable for your criminal actions,” said Debbi Mayer, Assistant Special Agent in Charge of the U.S. Department of Education Office of Inspector General's Eastern Regional Office. “As the law enforcement arm of the U.S. Department of Education, we will continue to aggressively pursue those who misappropriate student aid funds for their own purposes. America’s veterans and taxpayers deserve nothing less.”

“Today's sentencing of David Alvey is yet another example of the FBI's aggressive posture in pursuing those who defraud the government,” said Special Agent in Charge Gregory W. Ehrie of the Newark FBI Field Office. “This case, where the victims were U.S. military veterans, is no exception.”

In addition to the prison term, Judge Hayden sentenced Alvey to three years of supervised release and ordered restitution in the amount of $24,024,465.65.

DiBisceglie and Sechrist are scheduled to be sentenced June 5, 2018.

U.S. Attorney Carpenito credited special agents of the U.S. Department of Veterans Affairs, Office of Inspector General, Criminal Investigation Division, Northeast Field Office, under the direction of Special Agent in Charge Smith; the FBI, under the direction of Special Agent in Charge Ehrie in Newark; and the U.S. Department of Education, Office of Inspector General Eastern Regional Office, under the direction of Assistant Special Agent in Charge Mayer, with the investigation.

The government is represented by Assistant U.S. Attorney David M. Eskew, Deputy Chief of the U.S. Attorney’s Office Criminal Division, Senior Litigation Counsel David E. Malagold of the Criminal Division, Assistant U.S. Attorney Nicole Mastropieri of the Healthcare and Government Fraud Unit, and Assistant U.S. Attorney Jafer Aftab of the Asset Recovery and Money Laundering Unit.

Defense Counsel: Stacy Biancamano Esq., Chatham, New Jersey