District of New Jersey

NEWARK, N.J. – One of the FBI’s Ten Most Wanted Fugitives, who was arrested earlier this month in Virginia, made his initial appearance in federal court in Newark for a gang-related murder, Acting U.S. Attorney William E. Fitzpatrick announced.

In September 2013, Walter Yovany-Gomez, 33, a/k/a “Cholo,” was indicted by a Newark grand jury for murder in aid of racketeering and conspiracy to commit murder in an indictment that named 14 alleged members of Plainfield Locos Salvatrucha (PLS), a New Jersey branch of the Mara Salvatrucha (MS-13) transnational gang. At the time of the federal indictment, Yovany-Gomez was a fugitive.

In April 2017, the FBI placed Yovany-Gomez on its Ten Most Wanted Fugitive List. On August 12, 2017, he was arrested without incident in Woodbridge, Virginia, based on tips received from the public. He made his initial appearance before U.S. Magistrate Judge Michael A. Hammer this afternoon and was remanded without bail.

Between 2014 and 2016, all 13 of the other co-defendants charged in the September 2013 federal indictment were convicted, including eight MS-13 members who were convicted following a 16-week trial that ended in June 2016.

Yovany-Gomez is charged in connection with the murder of Julio Matute. According to the indictment and statements made in court:

On the morning of May 8, 2011, Matute was allegedly murdered by Yovany-Gomez and a conspirator, Cruz Flores, a/k/a “Bruja.” Gomez and Flores allegedly struck Matute in the head with a baseball bat, sliced his throat, and stabbed him in the back 17 times with a screwdriver, allegedly because Matute was suspected of socializing with a rival gang. Flores was found guilty of the murder during the trial described above.

Yovany-Gomez is charged with murder in aid of racketeering, which is punishable by a mandatory sentence of life in prison. The charge is a death penalty-eligible offense subject to a decision by the U.S. Attorney General.

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher; and special agents of U.S. Immigration and Customs Enforcement, Enforcement and Removal Operations, under the direction Newark Field Office Director John Tsoukaris. He also thanked the Union County Prosecutor’s Office, under the direction of Acting Prosecutor Grace Park, for long, close collaboration on the case. The FBI Washington Field Office’s Violent Crimes Task Force, the Fairfax County Police Department’s Gang Unit, and the Northern Virginia Gang Task Force coordinated the local search and arrest of Yovany-Gomez. He also acknowledged the U.S. Attorney’s Offices for the Eastern District of Virginia and the District of Maryland for their assistance in the ongoing investigation.

The government is represented by Assistant U.S. Attorneys James Donnelly and Jamari Buxton of the U.S Attorney’s Office Criminal Division in Newark.

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

CAMDEN, N.J. – A Medford, New Jersey, pharmacist was convicted today for his role in illegally distributing and dispensing oxycodone from two pharmacies located in Medford, Acting U.S. Attorney William E. Fitzpatrick announced.

Michael Ludwikowski, 45, the owner of Olde Medford Pharmacy and Medford Family Pharmacy, was convicted of six counts in an indictment charging him with illegally distributing and dispensing oxycodone, a Schedule II controlled substance, and maintaining a drug-involved premises. He was convicted following a five-week trial before U.S. District Judge Jerome B. Simandle in Camden federal court. The jury deliberated for three days before returning the guilty verdict.

The trial follows the guilty plea of co-defendant David M. Goldfield, also a pharmacist (who Ludwikowski had hired to work at Olde Medford Pharmacy), to engaging in a conspiracy to dispense controlled substances with Ludwikowski, and the pleas of Dontees Jones, Matthew Lawson, and Patrick Clark, all long-term customers of Ludwikowski, and Krystal Wood, a former employee of Olde Medford Pharmacy.

“For the people of New Jersey and across the United States, the suffering, loss of life, and enormous financial losses attributed to the opioid epidemic are all too real,” Acting U.S. Attorney Fitzpatrick said. “In the midst of this crisis, Ludwikowski – a pharmacist who had a duty to ensure that prescription opiates were dispensed only for legitimate medical purposes – knowingly sold them to customers with fake prescriptions or to individuals whom he knew to be addicts. He didn’t just fail in his professional responsibilities: he actively contributed to the opioid crisis, and as the jury decided today, broke federal laws in the process.”

“Opioid and prescription drug abuse have been spreading throughout our country. We are determined to investigate and prosecute those who unlawfully distribute oxycodone within our community,” Special Agent in Charge Timothy Gallagher of the FBI’s Newark office said. “Today’s conviction highlights the commitment of the FBI and our partners to combat the growth of this epidemic that continues to impact our society.”

Carl J. Kotowski, Special Agent in Charge of the Drug Enforcement Administration’s New Jersey Division said, “The current opioid epidemic is widespread and is tearing families apart. A pharmacist has a responsibility to play a role in curtailing this problem. In this case, the defendant chose to ignore that responsibility and instead was more interested in profiting on people’s addictions.”

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

From March 2008 through August 2013, Ludwikowski, the pharmacist-in-charge of Olde Medford Pharmacy, and his employee, Goldfield, knowingly distributed and dispensed oxycodone and other controlled substances to individuals, including addicts, who presented phony prescriptions.

Ludwikowski ordered large quantities of oxycodone from a national distributor. The distributor established thresholds for the quantity of controlled substances that it supplied to certain pharmacies. Ludwikowski and his pharmacies received large quantities of 30mg oxycodone pills, even though he knew the painkiller was not going to be used for legitimate medical reasons.

In some instances, the customers presented fraudulent prescriptions for a non-narcotic substance that had been “washed,” or “bleached,” through a chemical process that removed the original writing. The customers then rewrote the prescriptions for their drug of choice, oxycodone. Ludwikowski and Goldfield also ignored concerns raised by an employee who pointed out an obviously altered prescription.

Customers who used the fraudulent prescriptions generally paid in cash and provided gifts to Ludwikowski and Goldfield. In some instances, these customers filled fraudulent prescriptions for oxycodone multiple times a week.

In furtherance of the scheme, Ludwikowski and another pharmacist he employed – referred to in the indictment as “Pharmacist 3” – reached an agreement with a physician –referred to in the indictment as “Doctor 1” – to “steer” Doctor 1’s patients to Ludwikowski’s pharmacies. In a text message from Pharmacist 3 to Ludwikowski on Jan. 11, 2013, Pharmacist 3 wrote: “I talked to [Doctor 1] and he is going to direct all of his patients to us he is the pain doc in Cherry Hill.”

Each of the five substantive counts of illegal distribution of oxycodone carries a maximum potential penalty of 20 years in prison and a $1 million fine, or twice the gross gain or loss from the offense. The count of maintaining a drug-involved premises carries a maximum penalty of 20 years in prison and a $500,000 fine, or twice the gross gain or loss from the offense.

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI’s Newark Field Office, under the direction of Special Agent in Charge Gallagher; the DEA New Jersey Division, under the direction of Special Agent in Charge Kotowski; the Medford Police Department under the direction of Chief Richard J. Meder; the Moorestown Police Department under the direction of Chief Lee R. Lieber; the Florence Police Department under the direction of Chief John Bunce; and the Lumberton Police Department under the direction of Chief Tony Diloreto, with the investigation leading to today’s conviction.

The government is represented by Assistant U.S. Attorney Justin C. Danilewitz and Senior Litigation Counsel Jason M. Richardson of the U.S. Attorney’s Office in Camden, as well as Assistant U.S. Attorney Sarah Devlin of the Office’s Asset Forfeiture and Money Laundering Unit.

CAMDEN, N.J. – Three men today admitted defrauding New Jersey state health benefits programs and other insurers by submitting fraudulent claims for medically unnecessary prescriptions, Acting U.S. Attorney William E. Fitzpatrick and New Jersey Attorney General Christopher S. Porrino announced.

Michael Pepper, 45, an Atlantic City, New Jersey, firefighter from Northfield, New Jersey; Thomas Hodnett, 41, a pharmaceutical sales representative from Voorhees, New Jersey; and Steven Urbanski, 37, a pharmaceutical sales representative from Marlton, New Jersey, pleaded guilty before U.S. District Judge Robert B. Kugler in Camden federal court to separate informations charging them with conspiracy to commit health care fraud.

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

Compounded medications are supposed to be specialty medications mixed by a pharmacist to meet the specific medical needs of an individual patient. Although compounded drugs are not approved by the Food and Drug Administration (FDA), they are properly prescribed when a physician determines that an FDA-approved medication does not meet the health needs of a particular patient, such as if a patient is allergic to a dye or other ingredient.

From January 2015 through April 2016, Pepper, Hodnett, and Urbanski served as recruiters in the conspiracy and persuaded individuals in New Jersey to obtain very expensive and medically unnecessary compounded medications from an out-of-state pharmacy, identified in the informations as the “Compounding Pharmacy.” The conspirators learned that certain compound medication prescriptions – including pain, scar, antifungal, and libido creams, as well as vitamin combinations – were reimbursed for thousands of dollars for a one-month supply.

The conspirators also learned that some New Jersey state and local government and education employees, including teachers, firefighters, municipal police officers, and state troopers, had insurance coverage for these particular compound medications. An entity referred to in the informations as the “Pharmacy Benefits Administrator” provided pharmacy benefit management services for the State Health Benefits Program, which covers qualified state and local government employees, retirees, and eligible dependents, and the School Employees’ Health Benefits Program, which covers qualified local education employees, retirees, and eligible dependents. The Pharmacy Benefits Administrator would pay prescription drug claims and then bill the State of New Jersey for the amounts paid.

The conspirators recruited public employees and other individuals covered by the Pharmacy Benefits Administrator to fraudulently obtain compounded medications from the Compounding Pharmacy without any evaluation by a medical professional that they were medically necessary. In return, the pharmacy paid one of Pepper, Hodnett, and Urbanski’s conspirators a percentage of each prescription filled and paid by the Pharmacy Benefits Administrator, which was then distributed to other members of the conspiracy.

Once they had recruited an employee covered by the Pharmacy Benefits Administrator, Pepper, Hodnett, and Urbanski would obtain the employee’s insurance information and fill out a Compounding Pharmacy prescription form. They would select the compounded medications that paid the most without regard to their medical necessity.

Other conspirators would then get the prescriptions signed by doctors who never saw the patients and never evaluated whether the patients had a medical necessity for the compounded medication. The prescriptions were then faxed to Compounding Pharmacy, which filled the prescriptions and billed the Pharmacy Benefits Administrator.

According to the informations, the Pharmacy Benefits Administrator paid Compounding Pharmacy over $50 million for compounded medications mailed to individuals in New Jersey. Pepper received approximately $113,627.54 for his role in the scheme. Hodnett received approximately $269,966.08 for his role in the scheme. Urbanski received approximately $113,668.12 for his role in the scheme.

Each defendant faces a maximum penalty of 10 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. Sentencing for Pepper, Hodnett, and Urbanski is scheduled for Dec. 5, 2017.

As part of their plea agreements, Pepper must forfeit $113,627.54 in criminal proceeds and pay restitution of at least $719,481.65. Hodnett agreed to forfeit $269,966.08 and pay restitution of at least $1,497,541.44. Urbanski must forfeit $113,668.12 in criminal proceeds and pay restitution of at least $752,291.94.

Acting U.S. Attorney Fitzpatrick credited agents of the FBI’s Atlantic City Resident Agency, under the direction of Special Agent in Charge Timothy Gallagher in Newark, IRS – Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen in Newark, and the U.S. Department of Labor, Office of Inspector General, New York Region, under the direction of Special Agent in Charge Michael C. Mikulka, with the investigation leading to the guilty pleas. He also thanked the Division of Pensions and Financial Transactions in the State Attorney General’s Office, under the direction of Attorney General Porrino and Division Chief Eileen Schlindwein Den Bleyker, for its assistance in the investigation.

The government is represented by Assistant U.S. Attorneys R. David Walk, Jr. and Jacqueline M. Carle of the U.S. Attorney’s Office in Camden.

Defense counsel:

Pepper: Joseph A. Levin Esq., Atlantic City, New Jersey

Hodnett: James J. Leonard Jr. Esq., Atlantic City, New Jersey

Urbanski: Richard Sparaco Esq., Cherry Hill, New Jersey

CAMDEN, N.J. – Two men today admitted defrauding New Jersey state health benefits programs and other insurers out of $25 million by submitting fraudulent claims for medically unnecessary prescriptions, Acting U.S. Attorney William E. Fitzpatrick and New Jersey Attorney General Christopher S. Porrino announced.

Matthew Tedesco, 42, a pharmaceutical sales representative from Linwood, New Jersey, and Robert Bessey, 43, of Philadelphia, pleaded guilty before U.S. District Judge Robert B. Kugler in Camden federal court to separate informations charging them with conspiracy to commit health care fraud.

“Using a network of recruiters, doctors, and state and local government employees, the defendants defrauded the state of New Jersey and other health insurers out of millions of dollars by getting reimbursed for phony prescriptions on expensive and medically unnecessary compounded medications,” Acting U.S. Attorney Fitzpatrick said. “This conduct, which fraudulently exploited state health benefits programs and left New Jersey taxpayers on the hook for millions in losses, is especially brazen in an era when health insurance is a constant concern for many Americans.”

“While many New Jersey residents were hard at work trying to pay for adequate healthcare insurance coverage for their families, these two individuals were illegally bilking our system for millions,” said Attorney General Porrino. “Law enforcement partners across the state are attacking fraud on all fronts, prosecuting those who steal while honest citizens struggle. I want to thank the United States Attorney's Office for the District of New Jersey, Acting U.S. Attorney Fitzpatrick and all of our federal partners for unraveling and successfully prosecuting this complicated scheme.”

“These types of schemes and kickback arrangements cripple the healthcare industry and steal money from hardworking taxpayers by driving up the price of insurance,” Special Agent in Charge Timothy Gallagher of the FBI Newark Division said. “The FBI in conjunction with our federal and local law enforcement partners will continue to investigate allegations of fraud that undermine the integrity of our health care system.”

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

Compounded medications are supposed to be specialty medications mixed by a pharmacist to meet the specific medical needs of an individual patient. Although compounded drugs are not approved by the Food and Drug Administration (FDA), they are properly prescribed when a physician determines that an FDA-approved medication does not meet the health needs of a particular patient, such as if a patient is allergic to a dye or other ingredient.

From January 2015 through April 2016, Tedesco, a leader in the conspiracy, Bessey, a recruiter in the conspiracy, and others persuaded individuals in New Jersey to obtain very expensive and medically unnecessary compounded medications from an out-of-state pharmacy, identified in the informations as the “Compounding Pharmacy.” The conspirators learned that an entity referred to in the informations as the “Pharmacy Benefits Administrator” would reimburse pharmacies thousands of dollars for a one-month supply of certain prescription compounded medications, including pain, scar, antifungal, and libido creams, as well as over $10,000 per month for certain vitamin combinations.

The conspirators also learned that the Pharmacy Benefits Administrator managed the prescription drug benefit for some New Jersey state and local government and education employees, including teachers, firefighters, municipal police officers, and state troopers. The Pharmacy Benefits Administrator provided pharmacy benefit management services for the State Health Benefits Program, which covers qualified state and local government employees, retirees, and eligible dependents, and the School Employees’ Health Benefits Program, which covers qualified local education employees, retirees, and eligible dependents. The Pharmacy Benefits Administrator would pay prescription drug claims and then bill the State of New Jersey for the amounts paid.

The conspirators recruited public employees and other individuals covered by the Pharmacy Benefits Administrator to fraudulently obtain compounded medications from the Compounding Pharmacy without any evaluation by a medical professional that they were medically necessary. In return, the pharmacy paid one of Tedesco and Bessey’s conspirators a percentage of each prescription filled and paid by the Pharmacy Benefits Administrator, which was then distributed to other members of the conspiracy.

Once they had recruited an employee covered by the Pharmacy Benefits Administrator, Tedesco, Bessey, and others would obtain the employee’s insurance information and fill out a Compounding Pharmacy prescription form. They would select the compounded medications that paid the most and order 12 months of refills without regard to their medical necessity.

Tedesco and others had prescriptions signed by doctors who never saw the patients and never evaluated whether the patients had a medical necessity for the compounded medication. The prescriptions were then faxed to Compounding Pharmacy, which filled the prescriptions and billed the Pharmacy Benefits Administrator. Tedesco and others gave money and other benefits to doctors who signed the prescriptions and individuals who agreed to receive the medication.

According to the informations, the Pharmacy Benefits Administrator paid Compounding Pharmacy over $50 million for compounded medications mailed to individuals in New Jersey. Over $25 million of that was for prescriptions arranged by Tedesco and the conspirators working for him. Tedesco admitted receiving approximately $11,166,844.20 for submitting those fraudulent claims. He paid some of that money to the conspirators who worked for him. Bessey received approximately $485,540.09 for his role in the scheme.

“The U.S. Department of Labor Office of Inspector General is committed to combating illegal prescription drug schemes, like compounded medication fraud, particularly when they victimize programs administered by the Department of Labor. We will continue to work with our colleagues in other federal and state law enforcement agencies to aggressively investigate allegations of this nature,” said Michael C. Mikulka, Special Agent-in-Charge, New York Region, U.S. Department of Labor, Office of Inspector General.

“Healthcare programs are in place to provide the American taxpayer with valuable benefits, not for individuals like Mr. Tedesco and Mr. Bessey to exploit and pilfer in order to line their own pockets,” stated Jonathan D. Larsen, Special Agent in Charge, IRS-Criminal Investigation, Newark Field Office.

As part of his plea agreement, Tedesco must forfeit $11,166,844.20 in criminal proceeds and pay restitution of at least $28,773,906.97. Bessey agreed to forfeit $485,540.09 and pay restitution of at least $2,693,192.63.

Each defendant faces a maximum potential penalty of 10 years in prison and a $250,000 fine, or twice the gross gain or loss caused by the offense. Sentencing for both defendants is set for Dec. 4, 2017.

Acting U.S. Attorney Fitzpatrick credited agents of the FBI’s Atlantic City Resident Agency, under the direction of Special Agent in Charge Gallagher in Newark, IRS – Criminal Investigation, under the direction of Special Agent in Charge Larsen in Newark, and the U.S. Department of Labor, Office of Inspector General, New York Region, under the direction of Special Agent in Charge Mikulka, with the investigation leading to the guilty pleas. He also thanked the Division of Pensions and Financial Transactions in the State Attorney General’s Office, under the direction of Attorney General Porrino and Division Chief Eileen Schlindwein Den Bleyker, for its assistance in the investigation.

The government is represented by Assistant U.S. Attorneys R. David Walk, Jr. and Jacqueline M. Carle of the U.S. Attorney’s Office in Camden.

Defense counsel:

Matthew Tedesco: Michael Elliott Esq., Dallas, Texas

Robert Bessey: Brian J. McMonagle Esq., Philadelphia

NEWARK, N.J. – The former senior vice president of sales at Cinelli Iron & Metal Co. (CIMCO) today admitted participating in a 17-year conspiracy that defrauded customers out of millions of dollars, Acting U.S. Attorney William E. Fitzpatrick announced.

Michael A. Valenti III, 43, of Hasbrouck Heights, New Jersey, pleaded guilty before U.S. District Judge Susan D. Wigenton in Newark federal court to an information charging him with conspiracy to commit wire fraud.

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

CIMCO, which was headquartered in Secaucus, New Jersey, purchased scrap metal for resale and operated three scrap metal recycling facilities in New Jersey. CIMCO trucks would deliver scrap metal containers to customer jobsites and remove them after they were filled. CIMCO then purportedly paid customers based on the type and net weight of the scrap material.

From 1999 through March of 2016, Valenti, Craig Cinelli, Joseph Cinelli Sr., David Barteck and others allegedly used a variety of fraudulent business practices to buy scrap metal from CIMCO’s customers for less than CIMCO should have paid. The company then resold the scrap metal at a profit.

Instead of paying the proper, agreed-upon amounts for the actual weight, members of the conspiracy used a variety of techniques to misrepresent the true weight and type of the scrap metal, including altering documents to reflect a lower weight, removing scrap metal from a haul before it was weighed and misrepresenting the types of scrap metal contained in a haul.

The wire fraud conspiracy count carries a maximum potential penalty of up to 20 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense.

During his plea hearing, Valenti admitted that the loss caused by the conspiracy that was reasonably foreseeable to him was more than $9.5 million, but less than $25 million. His sentencing is scheduled for Nov. 21, 2017.

Acting U.S. Attorney Fitzpatrick credited special agents with the U.S. Department of Labor, Office of Inspector General, under the direction of Special Agent in Charge Michael Mikulka in New York; special agents with the U.S. Department of Transportation, Office of Inspector General, under the direction of Special Agent in Charge Douglas Shoemaker in New York; and special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation leading to today’s guilty plea.

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

This case is part of efforts underway by the Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices, and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions and other organizations. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants. For more information on the task force, please visit www.StopFraud.gov.

Defense counsel: Linda George Esq. Hackensack, New Jersey

CAMDEN, N.J. – A U.S. Postal Service (USPS) employee and three others were charged in connection with a $100,000 fraud involving numerous stolen blank money orders, Acting U.S. Attorney William E. Fitzpatrick announced today.

 

Marc Saunders, 39, of Sicklerville, New Jersey, is charged by complaint with stealing a money order imprinting machine and over 180 blank USPS money orders and defrauding the USPS by presenting them and providing them to others, knowing that they were issued unlawfully.

 

Anthony J. Bell, 38, Andre M. Sutton, 39, both of Philadelphia, and Eugene J. Bowen, 35, of Knoxville, Tennessee, are charged by complaint with defrauding the USPS by presenting the stolen money orders and providing them to others, knowing that they were issued unlawfully.

 

Saunders, Bell, and Sutton were arrested today and will appear this afternoon before U.S. Magistrate Judge Joel Schneider in Camden federal court. Bowen is still at large.

 

According to the complaints:

 

In 2014, Saunders worked at the New Lisbon, New Jersey, USPS branch. In late 2016, law enforcement learned that a money order imprinting machine and more than 180 blank money orders previously issued to that branch were missing. Beginning in 2015, some of the stolen blank money orders surfaced after having been imprinted with dollar amounts and cashed at different USPS branches in the Philadelphia area. About 130 of those stolen money orders were cashed through the end of 2016.

 

The investigation uncovered alleged links between people who cashed some of those money orders and middlemen Bell, Bowen, and Sutton, and links between the middlemen and Saunders. Saunders was linked to the middlemen through Facebook posts, telephone records, and other evidence. A number of the stolen money orders were cashed in the Knoxville area right after Bowen visited Saunders in New Jersey and returned to Tennessee.

 

The count of stealing a money order imprinting machine and blank postal money orders carries a maximum penalty of 10 years in prison and a $250,000 fine. The count of defrauding the USPS carries a maximum penalty of five years in prison and a $250,000 fine.

 

Acting U.S. Attorney Fitzpatrick credited special agents of the U.S. Postal Service, Office of the Inspector General, under the direction of Special Agent in Charge Monica Weyler, with the investigation.

 

The government is represented by Assistant U.S. Attorney Howard Wiener of the U.S. Attorney’s Office Criminal Division in Camden.

 

CAMDEN, N.J. – A Carbon County, Pennsylvania, man was sentenced today to 90 months in prison for conspiring to illegally traffic over 20 firearms – including assault rifles and other high-capacity weapons – into the Camden area, Acting U.S. Attorney William E. Fitzpatrick announced.

Darnel Johns, 49, of Albrightsville, Pennsylvania, previously pleaded guilty before U.S. District Judge Robert B. Kugler to an information charging him with one count of conspiracy to deal in firearms without a federal firearms license and one count of possession of firearms by a convicted felon. Judge Kugler imposed the sentence today in Camden federal court.

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

Johns admitted that in the Fall and Winter of 2014, he conspired with co-defendant David Potts, 45, of Camden, to illegally sell at least 22 guns. The firearms included a sawed-off shotgun, multiple high-capacity assault-style rifles, and a high-capacity assault-style pistol with a 30-round magazine. Several of the firearms were stolen and had obliterated serial numbers.

In addition to the prison term, Judge Kugler sentenced Johns to three years of supervised release.

Potts previously pleaded guilty to his role in the conspiracy and was sentenced on April 10, 2017 to 121 months in prison.

Acting U.S. Attorney Fitzpatrick credited special agents of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), under the direction of Special Agent in Charge John B. Devito, Newark Field Division, and Essam Rabadi, Special Agent in Charge of ATF’s Philadelphia Field Division, with the investigation. He additionally credited special agents of the Drug Enforcement Administration, Camden Resident Office, under the direction of Special Agent in Charge Carl J. Kotowski; the ATF Charlotte Field Division under the direction of Special Agent in Charge C. J. Hyman; investigators with the Camden County Prosecutor’s Office, under the direction of Prosecutor Mary Eva Colalillo; detectives of the Camden County Police Department, under the direction of Chief Scott J. Thomson; the Newark Division of Public Safety’s Ballistics Laboratory; and the Bergen County Sheriff’s Office Ballistics Laboratory, with the investigation.

He additionally credited the U.S. Marshals Service, under the direction of U.S. Marshal Juan Mattos, Jr.; investigators under the Camden High Intensity Drug Trafficking Area; the New Jersey State Police’s Metro South Unit, under the direction of Superintendent Col. Rick Fuentes; the New Jersey State Parole Board, under the direction of Chairman James T. Plousis; the Camden County Sheriff’s Office, under the direction of Sheriff Gilbert L. Wilson; and the Cherry Hill, Pennsauken and Maple Shade Police Departments.

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

This investigation was coordinated through the Camden County Crime Collaboration (“C-4”). Every federal, state and local law enforcement agency and prosecutor’s office responsible for combating drug trafficking, gang activity and violent crime in Camden has come together in one location to share intelligence, develop strategies and support the investigative and prosecutorial efforts of its partners. C-4 has merged the individual missions of the various law enforcement agencies into a single strategic attack on drug trafficking and drug-related violent crime. Such intense coordination greatly enhances the law enforcement community’s ability to correctly identify and successfully prosecute Camden’s most dangerous criminals.

Defense counsel: Thomas Young Esq., Assistant Federal Defender, Philadelphia

NEWARK, N.J. – A Newark man was sentenced today to 315 months in prison for his role in a violent and long-running racketeering conspiracy perpetuated by the “South Side Cartel,” a set of the Bloods Street gang based in Newark, Acting U.S. Attorney William E. Fitzpatrick announced.

Malik Lowery, a/k/a “Leek,” 36, previously pleaded guilty before U.S. District Judge Esther Salas to multiple counts of a second superseding indictment charging him with racketeering, racketeering conspiracy, carjacking, Hobbs Act Robbery and conspiracy to distribute, and to possess with intent to distribute, one kilogram or more of heroin and 280 grams or more of crack cocaine. Judge Salas imposed the sentence today in Newark federal court.

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

As part of the racketeering charges, Lowery admitted his role in the Oct. 20, 2007 murder of a member of the South Side Cartel that took place on Bragaw Avenue in Newark. Lowery also admitted to committing an armed carjacking with fellow South Side Cartel members on Jan. 3, 2008 and to the robbery of a drug dealer on Feb. 3, 2008, among other acts.

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’s center of activities were apartments located inside buildings dubbed the “Twin Towers,” located at 496-500 Hawthorne Avenue, the location of repeated narcotics and gun arrests by local law enforcement between 2002 and 2010. Many of the South Side Cartel members had tattoos showing these buildings and the logo of “SSC” representing the gang’s initials.

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 in state and federal prisons for gang-related crimes. The South Side Cartel was generally known among law enforcement and the FBI as the most violent street gang operating in Newark, committing numerous murders, shootings, robberies and other violent acts in furtherance of the enterprise.

In addition to the prison term, Judge Salas sentenced Lowery to 10 years of supervised release.

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark; police officers and detectives of the Newark Department of Public Safety, under the direction of Director Anthony A. Ambrose; and prosecutors and detectives of the Essex County Prosecutor’s Office, under the direction of Acting Prosecutor Robert D. Laurino, with the investigation.

The government is represented by Assistant U.S. Attorneys Robert Frazer and Courtney Howard of the Organized Crime/Gangs Unit in Newark.

Defense counsel: John Azzarello Esq., Morristown, New Jersey, Anthony Ricco, New York,

Co-Defendant Sentenced to 42 Months in Prison

 

TRENTON, N.J. – One Trenton man was convicted and another sentenced to prison today for their roles in a drug trafficking organization that distributed hundreds of grams of heroin in the Trenton area, Acting U.S. Attorney William E. Fitzpatrick announced.

 

Ishmael Abdullah, a/k/a “Ish,” a/k/a “Gangsta,” a/k/a “Papi,” 27, pleaded guilty today before U.S. District Judge Freda L. Wolfson in Trenton federal court to an information charging him with one count of conspiracy to distribute and possess with intent to distribute 100 grams or more of heroin and one count of unlawful possession of a firearm by a convicted felon.

 

Bernadino Guervil, 29, a/k/a “BG,” was sentenced today to 42 months in prison and three years of supervised release. Guervil previously pleaded guilty before Judge Wolfson to an information charging him with conspiracy to distribute and possess with intent to distribute heroin.

 

In December 2016, Abdullah 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 the organization’s leader. Abdullah is the sixth of the 10 defendants to plead guilty.

 

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

 

From May 2015 through December 2016, Abdullah and others participated in a drug trafficking organization that operated in the area of Spring and Passaic Streets in the 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 Jose Joaquin Torres-Mezquita and Ileana Sanchez. Ishmael Abdullah and Keith Hunter coordinated the organization’s distribution of heroin through themselves and other conspirators, including Guervil. Members of the Abdullah DTO used temporary prepaid phones, stash houses and cars, and spoke in code to avoid detection by law enforcement.

During his plea hearing, Abdullah admitted that he conspired with others to distribute at least 400 grams of heroin. Abdullah, who is a previously convicted felon, also admitted knowingly possessing a SCCY Industries CPX-2 firearm.

 

The conspiracy charge to which Abdullah 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. The firearms charge carries a maximum potential sentence of 10 years in prison and a $250,000 fine. Sentencing is scheduled for Nov. 27, 2017.

 

Acting U.S. Attorney Fitzpatrick credited agents and officers with the Greater Trenton Safe Streets Task Force, including special agents of the FBI, Newark Division, Trenton Resident Agency, under the direction of Special Agent in Charge Timothy Gallagher; special agents of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), Newark Division, Trenton Field Office, under the direction of Special Agent in Charge John B. Devito; officers of the Trenton Police Department, under the direction of Director Ernest Parrey Jr.; officers of the Princeton Police Department, under the direction of Chief Nicholas Sutter; officers of the Ewing Police Department, under the direction of Chief John P. Stemler III; and detectives of the Mercer County Prosecutor’s Office, under the direction of 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 Acting Special Agent in Charge Debra Parker; officers of the N.J. State Police, under the direction of Superintendent Col. Joseph R. Fuentes; 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.

 

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

 

NEWARK, N.J. – A Somerset, New Jersey, man today admitted defrauding the Veterans Affairs program by billing for services he had not actually performed, Acting U.S. Attorney William E. Fitzpatrick announced.

Apostolos Voudouris, 44, pleaded guilty before U.S. District Judge William H. Walls in Newark federal court to an information charging him with health care fraud. Voudouris also entered into a civil settlement agreement with the government, under which he will pay $476,460 to resolve the government’s claims under the False Claims Act.

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

Voudouris is a physician specializing in cardiology and electrophysiology. Beginning in 2006, Voudouris provided services to eligible veterans at the Veterans Affairs Medical Center in East Orange, New Jersey, pursuant to his contract with the Department of Veterans Affairs (VA).

Voudouris admitted that on more than 350 occasions between 2011 and 2015, he submitted documentation to the VA claiming to have performed procedures he had not actually performed. By doing so, Apostolos Voudouris fraudulently received $238,230 from the VA.

Voudouris faces a maximum penalty of 10 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. Sentencing is currently scheduled for Dec. 12, 2017. As part of his plea agreement, Voudouris must pay restitution of $238,230 to the VA in addition to the $476,460 civil settlement, for a total of $714,690.

Acting U.S. Attorney Fitzpatrick credited special agents of the Northeast Field Office, U.S. Department of Veterans Affairs, Office of Inspector General, under the direction of Special Agent in Charge Donna L. Neves; the U.S. Department of Health and Human Services – Office of the Inspector General, under the direction of Special Agent in Charge Scott J. Lampert, and the FBI, under the direction of Special Agent in Charge Timothy Gallagher, with the investigation.

The government is represented by Assistant U.S. Attorney Jacob T. Elberg, Chief of the U.S. Attorney’s Health Care and Government Fraud Unit, and by Assistant U.S. Attorney Susan Pappy of the U.S. Attorney’s Health Care and Government Fraud Unit.

The U.S. Attorney’s Office for the District of New Jersey reorganized its health care practice in 2010 and created a stand-alone Health Care and Government Fraud Unit to handle both criminal and civil investigations and prosecutions of health care fraud offenses. Since that time, the office has recovered more than $1.36 billion in health care and government fraud settlements, judgments, fines, restitution and forfeiture under the False Claims Act, the Food, Drug and Cosmetic Act, and other statutes.

Defense counsel: Kristen Santillo Esq., Newark

TRENTON, N.J. – A Monmouth County, New Jersey, man was sentenced today to 97 months in prison for downloading sexually explicit videos and images of children to his home computer, Acting U.S. Attorney William E. Fitzpatrick announced.

James Paroline, 28, of Red Bank, New Jersey, previously pleaded guilty before U.S. District Judge Freda L. Wolfson to Count One of an indictment charging him with receiving child pornography. Judge Wolfson imposed the sentence today in Trenton federal court.

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

Paroline was employed in Monmouth County as an assistant at a nursery school and as a summer camp counselor at a private school. Between Feb. 26, 2015, and March 2, 2015, Paroline accessed a website known as “PlayPen,” an underground online bulletin board and website dedicated to the advertisement and distribution of child pornography. During that period, Paroline logged into PlayPen under the username “jimbobtropolis,” which he had registered with PlayPen using his personal email address, and downloaded multiple videos and images depicting the sexual abuse of children from the website.

In addition to the prison term, Judge Wolfson sentenced Paroline to 10 years of supervised release.

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation. He also thanked officers of the Red Bank Police Department, under the direction of Chief of Police Darren McConnell; officers of the Middletown Police Department, under the direction of Chief Craig Weber; and detectives of the Monmouth County Prosecutor’s Office, under the direction of Prosecutor Christopher J. Gramiccioni; for their assistance.

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

Defense counsel: Darren Gelber Esq., Woodbridge, New Jersey

Four defendants pleaded guilty today and yesterday to federal charges for their roles in an inter-state dog fighting network spanning from New Mexico to New Jersey, announced Acting Assistant Attorney General Jeffrey H. Wood of the Justice Department’s Environment and Natural Resources Division, and Acting United States Attorney for the District of New Jersey William E. Fitzpatrick.  A fifth defendant pleaded guilty in June.  U.S. District Judge Mary L. Cooper in Trenton accepted the following pleas:

• Anthony “Monte” Gaines, 36, of Vineland, New Jersey, a/k/a “Whiteboy,” pleaded guilty yesterday to two felony counts of conspiracy to buy, sell, receive, transport, deliver, and possess dogs intended for use in an animal fighting venture, and one felony count of possessing a dog intended for use in an animal fighting venture. 

• Lydell Harris, 32, of Vineland, New Jersey, a/k/a “Sinn,” pleaded guilty yesterday to one felony count of conspiracy to sponsor or exhibit a dog in an animal fighting venture, and one felony count of possessing a dog intended for use in an animal fighting venture. 

• Frank Nichols, 40, of Millville, New Jersey, pleaded guilty today to one felony count of conspiracy to transport, deliver and receive dogs intended for use in an animal fighting venture, and one felony count of possessing a stolen firearm subsequent to a felony conviction. 

• Pedro Cuellar, 47, of Willow Springs, Illinois, pleaded guilty today to one felony count of conspiracy to transport, deliver, and receive dogs intended for use in an animal fighting venture.

• Mario Atkinson, 42, of Asbury Park, New Jersey, pleaded guilty on June 15, 2017 before Judge Anne E. Thompson in U.S. District Court in Trenton to one count of sponsoring or exhibiting a dog in an animal fighting venture, and one count of possessing a dog intended for use in an animal fighting venture.

Nichols and Harris pleaded guilty to indictments. Gaines, Cuellar, and Atkinson were charged with Bills of Information.  Charges remain pending against four defendants.

According to court documents filed in connection with the cases, from October 2015 through June 1, 2016, the pleading defendants and their co-defendants and associates fought dogs – including to the death – and trafficked in dogs with other dog fighters in Indiana, Illinois, New Mexico, and elsewhere so that those dogs could be used in dog fights. They also maintained fighting dogs and dog fighting equipment such as dog treadmills, intravenous drug bags and lines, “breeding stands” used to immobilize female dogs, and chains weighing up to several pounds per linear foot. Agents found canine blood on the floor, walls, and ceiling of the basement of one defendant’s residence, indicating that the area was likely used as a dog fighting pit.  Among other acts involved in the charges, one of the pleading defendants admitted that his dog died in his car on the way home after losing a dog fight.

“Justice is being delivered in these cases,” said Acting Assistant Attorney General Wood.  “Ending animal fighting ventures and other inhumane practices depends upon the hard work of investigators and lawyers like those who brought these cases, and will also require continued partnership with federal, state, and local law enforcement agencies. Our Division is proud to be a leader in this worthy cause. We also applaud the work of the Humane Society in partnering with us to provide hope of recovery for the abused animals." 

“The criminal conduct speaks to the cruel conditions in which these animals live,” Acting U.S. Attorney Fitzpatrick said. “This office, along with our law enforcement partners and the Humane Society, is working to end this illegal activity and punish those who abuse animals for their own enjoyment.”

“The provisions of the Animal Welfare Act were designed to protect animals from being used in illegal fighting ventures, which often entail other forms of criminal activity involving drugs, firearms and gambling,” said Special Agent-in-Charge Bethanne M. Dinkins of the U.S. Department of Agriculture’s Office of Inspector General.  “Together with the Department of Justice, animal fighting is an investigative priority for USDA-OIG, and we will work with our law enforcement partners to investigate and assist in the criminal prosecution of those who participate in animal fighting ventures.” 

This case is part of Operation Grand Champion, a coordinated effort across numerous federal judicial districts to combat organized dog fighting.  The phrase “Grand Champion” is used by dog fighters to refer to a dog with more than five dog fighting “victories.” To date, 98 dogs have been rescued as part of Operation Grand Champion, and either surrendered or forfeited to the government. The Humane Society of the United States assisted with the care of the dogs seized by federal law enforcement. The government is represented by Trial Attorney Ethan Eddy of the Justice Department’s Environmental Crimes Section, and Assistant U.S. Attorney Kathleen O’Leary. The case is being investigated by the U.S. Department of Agriculture – Office of Inspector General, the U.S. Department of Homeland Security – Homeland Security Investigations, and the Federal Bureau of Investigation.

Each animal fighting charge carries a maximum sentence of five years in prison and a $250,000 fine.  The weapons charge against defendant Nichols carries a maximum sentence of ten years in prison and a $250,000 fine.  The investigation is ongoing.

New Jersey and Chicago-Area Defendants Convicted as Part of Operation Grand Champion

 

TRENTON, N.J. – Four men have admitted their respective roles in an interstate dog fighting network spanning from New Mexico to New Jersey, Acting U.S. Attorney William E. Fitzpatrick, District of New Jersey, and Acting Assistant Attorney General Jeffrey H. Wood of the Justice Department’s Environment and Natural Resources Division, announced today.

 

The four defendants, arrested and charged as part of a coordinated effort across numerous federal judicial districts to combat organized dog fighting, pleaded guilty before U.S. District Judge Mary L. Cooper in Trenton federal court:

 

• Frank Nichols, 40, of Millville, New Jersey, pleaded guilty today to one felony count of conspiracy to transport, deliver and receive dogs intended for use in an animal fighting venture, and one felony count of possessing a stolen firearm subsequent to a felony conviction.

• Pedro Cuellar, 47, of Willow Springs, Illinois, pleaded guilty today to one felony count of conspiracy to transport, deliver, and receive dogs intended for use in an animal fighting venture.

• Anthony “Monte” Gaines, 36, of Vineland, New Jersey, a/k/a “Whiteboy,” pleaded guilty yesterday to two felony counts of conspiracy to buy, sell, receive, transport, deliver, and possess dogs intended for use in an animal fighting venture, and one felony count of possessing a dog intended for use in an animal fighting venture.

• Lydell Harris, 32, of Vineland, New Jersey, a/k/a “Sinn,” pleaded guilty yesterday to one felony count of conspiracy to sponsor or exhibit a dog in an animal fighting venture, and one felony count of possessing a dog intended for use in an animal fighting venture.

 

A fifth defendant, Mario Atkinson, 42, of Asbury Park, New Jersey, pleaded guilty on June 15, 2017, before U.S. District Judge Anne E. Thompson in Trenton federal court to one count of sponsoring or exhibiting a dog in an animal fighting venture, and one count of possessing a dog intended for use in an animal fighting venture. Nichols and Harris pleaded guilty to indictments. Gaines, Cuellar, and Atkinson pleaded guilty to informations. Charges remain pending against four defendants.

According to court documents filed in these cases and statements made in court:

 

From October 2015 through June 1, 2016, the defendants who pleaded guilty and their co-defendants and associates participated in dog fights – including to the death – and trafficked in dogs with other dog fighters in New Jersey, Indiana, Illinois, New Mexico, and elsewhere so that those dogs could be used in fights. They also maintained fighting dogs and dog fighting equipment, such as treadmills, intravenous drug bags and lines, “breeding stands” used to immobilize female dogs, and chains weighing up to several pounds per linear foot. Agents found canine blood on the floor, walls, and ceiling of the basement of one defendant’s residence, indicating that the area was likely used as a dog fighting pit. One of the defendants admitted that his dog died in his car on the way home after losing a dog fight.

 

“The criminal conduct speaks to the cruel conditions in which these animals live,” Acting U.S. Attorney Fitzpatrick said. “This office, along with our law enforcement partners and the Humane Society, is working to end this illegal activity and punish those who abuse animals for their own enjoyment.”

“Justice is being delivered in these cases,” Acting Assistant Attorney General Jeffrey H. Wood of the Justice Department’s Environment and Natural Resources Division said. “Ending animal fighting ventures and other inhumane practices depends upon the hard work of investigators and lawyers like those who brought these cases, and will also require continued partnership with federal, state, and local law enforcement agencies. Our Division is proud to be a leader in this worthy cause. We also applaud the work of the Humane Society in partnering with us to provide hope of recovery for the abused animals."

 

“The provisions of the Animal Welfare Act were designed to protect animals from being used in illegal fighting ventures, which often entail other forms of criminal activity involving drugs, firearms and gambling,” Special Agent-in-Charge Bethanne M. Dinkins, U.S. Department of Agriculture - Office of Inspector General, said. “Together with the Department of Justice, animal fighting is an investigative priority for USDA-OIG, and we will work with our law enforcement partners to investigate and assist in the criminal prosecution of those who participate in animal fighting ventures.”

 

The charges are part of Operation Grand Champion, a coordinated effort across numerous federal judicial districts to combat organized dog fighting. The phrase “Grand Champion” is used by dog fighters to refer to a dog with more than five dog fighting “victories.” To date, 98 dogs have been rescued as part of Operation Grand Champion, and either surrendered or forfeited to the government. The Humane Society of the United States assisted with the care of the dogs seized by federal law enforcement.

 

Each animal fighting charge carries a maximum sentence of five years in prison and a $250,000 fine. The weapons charge against defendant Nichols carries a maximum sentence of ten years in prison and a $250,000 fine. Sentencing for Nichols and Cuellar is scheduled for Nov. 29, 2017. Sentencing for Gaines and Harris is scheduled for Nov. 28, 2017. Sentencing for Atkinson is scheduled for Oct. 3, 2017. All sentencings are before Judge Thompson.

 

The government is represented by Assistant U.S. Attorney Kathleen O’Leary, District of New Jersey, and Trial Attorney Ethan Eddy of the Justice Department’s Environmental Crimes Section.

 

The investigation by the U.S. Department of Agriculture - Office of Inspector General; the U.S. Department of Homeland Security - Homeland Security Investigations; and the FBI is ongoing.

 

Nichols: Michael Calabro Esq., Newark

Cuellar: Joseph Rotella Esq., Newark

Harris: Herbert Waldman Esq., Springfield, New Jersey

Gaines: Vincent LaPaglia Esq., Hoboken, New Jersey

Atkinson: Christopher D. Adams Esq., Holmdel, New Jersey

NEWARK, N.J. – Two members of a scheme that used secret card-reading devices and pinhole cameras on PNC and Bank of America ATMs to steal at least $428,581 pleaded guilty today in Newark federal court, Acting U.S. Attorney William E. Fitzpatrick announced.

 

Florin Mares, 49, and his brother, Gabriel Mares, 44, both of College Point, New York, pleaded guilty before U.S. District Judge Esther Salas to separate informations charging them each with one count of conspiracy to commit bank fraud and one count of aggravated identity theft.

 

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

 

Florin Mares, Gabriel Mares, and others sought to defraud financial institutions and their customers by illegally obtaining customer account information, including account numbers and personal identification numbers. Florin Mares and Gabriel Mares both admitted that between March 2015 and July 2016, they made unauthorized cash withdrawals using the counterfeit ATM cards.

 

The conspiracy to commit bank fraud charge carries a maximum potential penalty of 30 years in prison and a $1 million fine. Sentencing for both defendents is set for Nov. 20, 2017.

 

Joel Abel Garcia, Victor A. Hanganu, Radu Bogdan Marin, Marcel Peckham, Catalin Mihai Dragomir, Eduard Vasilica Ticu, Silvester Florentin Papp, Stefan Dumitru, and Florian Calin Crainic also pleaded guilty to their roles in the scheme. To date, 11 of the 13 defendants charged in this matter have been convicted.

 

U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI) Newark Division, under the direction Acting Special Agent in Charge Debra Parker, along with the U.S. Secret Service’s Boston Field Office; Longmeadow, Massachusetts, Police Department; Cambridge, Massachusetts, Police Department; and Medford, Massachusetts, Police Department investigated the case with assistance from Bank of America Security and Fraud Section and PNC Bank Security Division. The Middlesex County, Massachusetts, District Attorney’s Office; U.S. Attorney’s Office of the Eastern District of New York and U.S. Attorney’s Office of the District of Massachusetts Springfield Division assisted in the investigation and prosecution.

 

The government is represented by Assistant U.S. Attorney Kelly Graves of the U.S. Attorney’s Office Criminal Division in Newark and Trial Attorney Marianne Shelvey of the Justice Department’s Criminal Division Organized Crime and Gang Section.

 

Defense counsel:

Florin Mares: David Glazer Esq., Livingston, New Jersey

Gabriel Mares: Laurie Fierro Esq., Kinnelon, New Jersey

CAMDEN, N.J. – An Atlantic County, New Jersey, man who was sentenced in 2007 in connection with a scheme to defraud women over telephone dating services and in 2015 for violating the conditions of his federal supervised release was sentenced today to 60 months in prison for traveling to launder money in connection with a similar scheme, Acting U.S. Attorney William E. Fitzpatrick announced.

Patrick Giblin, 53, formerly of Ventnor, New Jersey, previously pleaded guilty before U.S. District Judge Robert B. Kugler to an information charging him with one count of interstate travel and use of a facility in interstate and foreign commerce with the intent to launder money. Judge Kugler imposed the sentence today in Camden federal court.

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

From January 2013 to Dec. 16, 2014, Giblin allegedly posted advertisements and messages on telephone dating services throughout the United States. Giblin cultivated a telephone rapport with the women he spoke to on these services, falsely claimed that he would be relocating or travelling to the woman’s geographic area, and falsely represented that he wished to pursue a committed, romantic relationship with each woman. He then lied to the women about needing a loan, which he never intended to repay, for relocation or travel expenses. Giblin received money from the women he spoke to on the dating services via interstate wire services such as Western Union and MoneyGram. Giblin also directed women to transfer money through one of these services onto a payroll/debit card that he used. Giblin used some of his victims’ money in order to purchase airtime minutes for cellular telephones, which he in turn used to defraud additional women.

In October 2014, Giblin travelled from Atlantic County, New Jersey, to Albany County, New York. Giblin, who was on federal supervised release from a previous conviction, was not allowed to leave the state. While traveling in New York, Giblin continued to defraud women and used money he received from women to purchase additional airtime minutes and contact more women. Giblin victimized more than 10 women in various states, causing losses of $15,000 to $40,000.

Giblin was previously convicted of 10 counts of wire fraud in 2007 in connection with a similar scheme. In 2015, Giblin was imprisoned for violating the terms of his supervised release imposed in connection with the 2007 sentence. Giblin was also sentenced in 2013 in the Eastern District of Pennsylvania for escaping from a halfway house in Philadelphia, where he was living following the completion of the 2007 sentence. Giblin initiated the scheme in this current case at about the time that he escaped from the halfway house and resumed the scheme following the service of his sentence on the escape conviction.

In addition to the prison term, Judge Kugler sentenced Giblin to three years of supervised release and ordered him to pay $39,130 in restitution.

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation leading to today’s sentencing. He also thanked the U.S. Marshals Service, under the direction of U.S. Marshal Juan Mattos in Newark, for its assistance in this case.

The government is represented by Deputy Attorney-in-Charge Matthew J. Skahill and Assistant U.S. Attorney Gabriel J. Vidoni of the U.S. Attorney’s Office in Camden.

Defense counsel: Christopher O’Malley Esq., Assistant Federal Public Defender (Camden)

NEWARK, N.J. – PHH Corp., PHH Mortgage Corp. and PHH Home Loans (PHH) have agreed to pay the United States $74,453,802 to resolve allegations that they violated the False Claims Act by knowingly originating and underwriting mortgage loans insured by the U.S. Department of Housing and Urban Development’s (HUD) Federal Housing Administration (FHA), guaranteed by the United States Department of Veteran Affairs (VA), and purchased by the Federal Housing Finance Agency (FHFA) that did not meet applicable requirements, the Justice Department announced today. PHH Corp. and PHH Mortgage Corp. are headquartered in Mount Laurel, New Jersey, while PHH Home Loans is headquartered in Edina, Minnesota. PHH has agreed to pay $65 million to resolve the FHA allegations and $9.45 million to resolve the VA and FHFA allegations.

“This settlement requires PHH to pay back to the taxpayers of the United States millions of dollars in loans that never should have been made,” Acting U.S. Attorney William E. Fitzpatrick for the District of New Jersey said. “By failing to ensure the creditworthiness of borrowers and otherwise failing to make sure the loans met HUD underwriting requirements, loans were insured by FHA that should not have been.”

“Government mortgage programs designed to assist homeowners — including programs offered by the FHA, VA, Fannie Mae and Freddie Mac — depend on lenders to approve only eligible loans,” said Acting Assistant Attorney General Chad A. Readler, head of the Justice Department’s Civil Division. “The Department has and will continue to hold accountable lenders that knowingly cause the government to guarantee, insure, or purchase loans that are materially deficient and put both the homeowner and the taxpayers at risk.”

The settlements announced today resolve allegations that PHH failed to comply with certain FHA, VA, and FHFA origination, underwriting, and quality control requirements.

Since January 2006, PHH has participated as a Direct Endorsement Lender (DEL) in the FHA insurance program. A DEL has the authority to originate, underwrite, and endorse mortgages for FHA insurance. If a DEL approves a mortgage loan for FHA insurance and the loan later defaults, the holder of the loan may submit an insurance claim to HUD, FHA’s parent agency, for the losses resulting from the defaulted loan. Under the DEL program, the FHA does not review a loan before it is endorsed for FHA insurance for compliance with FHA’s credit and eligibility standards, but instead relies on the efforts of the DEL to verify compliance. DELs are therefore required to follow program rules designed to ensure that they are properly underwriting and certifying mortgages for FHA insurance.

As part of the settlement, PHH admitted the following facts concerning the FHA loans:

 

Between Jan. 1, 2006, and Dec. 31, 2011, it certified for FHA insurance mortgage loans that did not meet HUD underwriting requirements and did not adhere to FHA’s self-reporting requirements. Examples of loan defects that PHH admitted resulted in loans being ineligible for FHA mortgage insurance included:

 

• Failing to document the borrowers’ creditworthiness, including paystubs, verification of employment, proper credit reports, and verification of the borrowers’ earnest money deposit and funds to close.

   

• Failing to document the borrower’s claimed net equity in a prior residence or documentation showing that the borrower had paid off significant debts. Including these debts in the borrower’s liabilities resulted in the borrower exceeding HUD’s debt-to-income ratio requirements for FHA-insured loans.

   

• Insuring a loan for FHA mortgage insurance even though the borrower did not meet HUD’s minimum statutory investment for the loan.

In 2007, PHH audited a targeted sample of government loans for closing or pre-insuring requirements and found that its “percent accurate” did not exceed 50 percent during 2007. Since 2006, HUD has required self-reporting of material violations of FHA requirements. However, between Jan.1, 2006, and Dec. 31, 2011, PHH Home Loans did not self-report any loans to HUD until 2013, after the United States commenced its investigation resulting in this Settlement Agreement.

As a result of PHH’s conduct and omissions, PHH admitted, HUD insured loans endorsed by PHH that were not eligible for FHA mortgage insurance under the DEL program, and that HUD would not otherwise have insured. It admitted that HUD subsequently incurred substantial losses when it paid insurance claims on those loans.

 

In addition, from at least 2005 to2012, PHH was a VA approved lender, originating and underwriting mortgage loans and obtaining VA loan guarantees. Also from at least 2009 to 2013, PHH sold mortgage loans to the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corp. (Freddie Mac). The FHFA provides oversight to Fannie Mae and Freddie Mac. The settlement resolves the United States’ contentions that PHH originated and underwrote VA loans that were ineligible for the loan guarantee program, and sold loans to the Freddie Mac and Fannie Mae that did not meet their requirements.

 

“This case demonstrates HUD’s resolve in protecting the integrity of its mortgage insurance programs for the benefit of all Americans, and in particular, first time homebuyers,” said Dane Narode, HUD’s Associate General Counsel for Program Enforcement. “We are gratified that PHH has accepted responsibility for its actions.”

 

“This settlement resolves allegations of reckless origination and underwriting of VA guaranteed mortgage loans,” said Michael J. Missal, Inspector General, for the Office of Inspector General for the Department of Veteran Affairs (VA OIG). “It sends a clear message that the VA OIG will aggressively protect the integrity of this crucial program which helps so many of our veterans buy, build, or repair their homes. I would also like to thank the U.S. Attorney’s Offices for partnering with us to achieve this significant result.”

 

An investigation into the allegations resolved by these settlements was commenced jointly by the U.S. Attorney’s Offices for the Districts of New Jersey, Minnesota and the Southern District of Florida, in conjunction with the Department of Justice’s Civil Division. After the investigation was commenced, a whistleblower lawsuit was filed under the False Claims Act by a former employee of PHH, raising similar as well as additional allegations of fraud. Under the False Claims Act, private citizens can sue on behalf of the government and share in any recovery.

 

The settlements were the result of joint investigations conducted by HUD, the HUD Office of Inspector General, the Veterans Administration’s Office of Inspector General, the FHFA Office of Inspector General, the Department of Justice’s Civil Division, and the U.S. Attorney’s Offices for the District of Minnesota, District of New Jersey, Southern District of Florida, and Eastern District of New York. Assistant United States Attorneys Anthony LaBruna and Mark Orlowski represented the District of New Jersey in this investigation and settlement: Ann Bildtsen represented the District of Minnesota, and James Weinkle represented the Southern District of Florida. The claims asserted against PHH are allegations only, and there has been no determination of liability.

 

TRENTON, N.J. – The sole proprietor of a purported loan modification consulting company today admitted that he fraudulently billed clients more than $400,000 for services that were never performed, Acting U.S. Attorney William E. Fitzpatrick announced.

Jeffrey Halpern, 62, of Hewlett, New York, pleaded guilty before U.S. District Judge Peter G. Sheridan in Trenton federal court to an information charging him with one count of wire fraud.

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

Between 2009 and 2016, Halpern operated JCK Marketing and solicited business from individuals who were seeking home loan modifications on their residential mortgages. Halpern told these individuals that, for a fee, he would negotiate loan modifications on their behalf.

In actuality, Halpern pocketed the funds but performed little or no actual services in connection with the purported loan modifications. Halpern also repeatedly demanded money for “bank fees” from his victims, even though none of the related financial institutions charged fees for loan modifications. During the relevant time period, Halpern defrauded at least 26 victims of over $400,000.

The wire fraud charge carries a maximum potential penalty of 20 years in prison and a $250,000 fine. As part of his plea agreement, Halpern must also pay restitution to the victims. Sentencing is scheduled for Nov. 22, 2017.

Acting U.S. Attorney Fitzpatrick credited investigators with the U.S. Attorney’s Office and special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation. He also thanked the New York State Department of Financial Services, under the direction of Superintendent Maria T. Vullo; the Federal Housing Finance Agency Office of the Inspector General, under the direction of Special Agent in Charge Steven Perez; and the Nassau County District Attorney’s office, under the direction of District Attorney Madeline Singas, for their assistance.

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

Defense counsel: Mitchell C. Elman Esq., Port Washington, New York

PHILADELPHIA – The U.S. Court of Appeals for the Third Circuit today upheld the 35-month prison sentence of the former chairman of the Bergen County Democratic Organization (BCDO), who was convicted at trial for his role in a racketeering scheme involving bribery and fraud, Acting U.S. Attorney William E. Fitzpatrick announced.

Joseph A. Ferriero, 60, had raised multiple issues on appeal, each of which was rejected in a unanimous, precedential opinion written by Judge Anthony J. Scirica.

 

Ferriero had argued, among other things, that the evidence convicting him of bribery was insufficient. The Court disagreed, noting that the evidence showed he had agreed to accept payments from a software services company soliciting business from various Bergen County towns, in exchange for recommending the company to those towns. It noted that, as BCDO “party chair, Ferriero’s recommendations carried great weight.”

 

The Court reached a similar conclusion regarding the sufficiency of the evidence showing Ferreiro had committed fraud. It noted that, in response to an inquiry from one of those towns about who was involved in the software services company, Ferriero had concealed his financial interest in the company’s revenues.

 

The Court also rejected Ferriero’s arguments that the constitution prevented New Jersey’s bribery statute from applying to his conduct. It held there was no constitutional issue because “New Jersey’s bribery law does not punish legitimate First Amendment activity.” Instead, “[i]t punishes corrupt agreements in which party officials accept payment in exchange for making a particular decision or recommendation, expressing a particular opinion, or voting a particular way . . . . Such corrupt agreements do not enjoy First Amendment protection.”

 

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

 

Ferriero served as the chairman of the BCDO from 1998 until January 2009 and was the sole member of SJC Consulting LLC. The jury found Ferriero accepted bribes in his capacity as BCDO chairman in the course of a scheme involving SJC. Ferriero agreed with John Carrino, a Nutley, New Jersey-based attorney and software developer, that Ferriero would recommend and provide a favorable opinion of the software developer and his companies to various public officials in Bergen County with whom Ferriero had influence. The software developer agreed to pay Ferriero one-quarter to one-third of the gross receipts from any contract obtained because of Ferriero’s efforts. Ferriero’s financial interest in the software developer’s public contracts was completely hidden using two shell companies, one of which was created and incorporated in Nevada for the sole purpose of contracting with and accepting payments from another shell company controlled by the software developer.

 

In addition to his prison sentence, which will be followed by three years’ supervised release, the Court affirmed the order requiring Ferriero to pay restitution.

 

The government was represented by Assistant U.S. Attorney Bruce P. Keller of the U.S. Attorney’s Office Appeals Division in Newark. Assistant U.S. Attorney Barbara Llanes, now Chief of the General Crimes Unit, represented the government at Ferriero’s trial.

NEWARK, N.J. – The owners of Cinelli Iron & Metal Co. (CIMCO) were arrested today and charged with operating a 17-year conspiracy that defrauded customers out of millions of dollars, Acting U.S. Attorney William E. Fitzpatrick announced.

Craig Cinelli, 47, of Allendale, New Jersey, and his brother, Joseph Cinelli Sr., 61, of Montvale, New Jersey, are charged by indictment with one count of conspiracy to commit wire fraud and five counts of wire fraud. They were arrested this morning and are expected to appear this afternoon before U.S. Magistrate Cathy L. Waldor in Newark federal court.

David Barteck, 53, of Wood Ridge, New Jersey, the former chief financial officer of CIMCO, pleaded guilty on July 26, 2017 before U.S. District Judge Susan D. Wigenton to an information charging him with one count of conspiracy to commit wire fraud.

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

CIMCO, which was headquartered in Secaucus, New Jersey, purchased scrap metal for resale and operated three scrap metal recycling facilities in New Jersey. CIMCO trucks would deliver scrap metal containers to customer jobsites and remove them after they were filled. CIMCO then purportedly paid customers based on the type and net weight of the scrap material.

From 1999 through March of 2016, Craig Cinelli, Joseph Cinelli Sr., Barteck and others allegedly used a variety of fraudulent business practices to buy scrap metal from CIMCO’s customers for less than CIMCO should have paid. The company then resold the scrap metal at a profit.

Instead of paying the proper, agreed-upon amounts for the actual weight, members of the conspiracy used a variety of techniques to misrepresent the true weight and type of the scrap metal, including altering documents to reflect a lower weight, removing scrap metal from a haul before it was weighed and misrepresenting the types of scrap metal contained in a haul.

The wire fraud conspiracy and substantive wire fraud counts each carry a maximum potential penalty of up to 20 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense.

During his plea hearing, Barteck admitted that the loss caused by the conspiracy that was reasonably foreseeable to him was more than $9.5 million, but less than $25 million. His sentencing is scheduled for Oct. 30, 2017.

The charges and allegations contained in the indictment are merely accusations, and Craig Cinelli and Joseph Cinelli Sr. are presumed innocent unless and until proven guilty.

Acting U.S. Attorney Fitzpatrick credited special agents with the U.S. Department of Labor, Office of Inspector General, under the direction of Special Agent in Charge Michael Mikulka in New York; special agents with the U.S. Department of Transportation, Office of Inspector General, under the direction of Special Agent in Charge Douglas Shoemaker in New York; and special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation.

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

This case is part of efforts underway by the Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices, and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions and other organizations. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants. For more information on the task force, please visit www.StopFraud.gov.

Defense counsel:

Craig Cinelli: Ray Flood, Esq., Hackensack, New Jersey

Joseph Cinelli Sr.: Jonathan Goldstein, Esq., Newark, New Jersey

David Barteck: John J. Bruno Jr. Esq. and John F. Latoracca Esq., Rutherford, New Jersey

NEWARK, N.J. – A Rockland County, New York, man was sentenced today to 24 months in prison for his role in a conspiracy to rob a bar in Hawthorne, New Jersey, Acting U.S. Attorney William E. Fitzpatrick announced.

Oscar Avalos-Cortez, 23, of New City, New York, previously pleaded guilty before U.S. District Judge Jose L. Linares to an information charging him with conspiracy to commit Hobbs Act Robbery. Judge Linares imposed the sentence today in Newark federal court.

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

On Dec. 25, 2015, Avalos-Cortez drove at least six conspirators to a bar in Hawthorne, where they forcibly robbed the bar and subsequently fled with approximately $200 in cash in Avalos-Cortez’s car.

In addition to the prison term, Judge Linares sentenced Avalos-Cortez to three years of supervised release.

Avalos-Cortez was originally charged with Wilbur Jonathan Barahona, 21, of Ridgewood, New Jersey, Guillermo Carrillo-Iraheta, 20, of Suffern, New York, Balmore Carrillo-Iraheta, 20, of Suffern, Juan Chiliseo-Vega, 20, of Suffern, and Jostin Reyes, 21, of Waldwick, New Jersey, in November 2016.

Chiliseo-Vega, Guillermo Carrillo-Iraheta and Reyes previously pleaded guilty in Newark federal court to three-count informations in connection with their involvement in the conspiracy to commit Hobbs Act Robbery, as well as a carjacking and kidnapping in which Avalos-Cortez was not involved. On July 7, 2017, Chiliseo-Vega was sentenced to 168 months in prison and Guillermo Carrillo-Iraheta was sentenced to 150 months in prison. Reyes is scheduled to be sentenced Oct. 18, 2017.

Balmore Carrillo-Iraheta was indicted by a federal grand jury on April 18, 2017, for his role in the conspiracy to rob the bar. The charges against Barahona for his role in the robbery, carjacking, and kidnapping are still pending. Both men are presumed innocent unless and until proven guilty.

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, as well as the Ridgewood and Hawthorne Police Departments, with the investigation leading to today’s sentencing.

The government is represented by Assistant U.S. Attorneys Elaine K. Lou and Karen D. Stringer of the U.S. Attorney’s Office’s Criminal Division in Newark.

NEWARK, N.J. - A Jersey City, New Jersey, man was sentenced today to 18 months in prison for stealing more than $250,000 from the Jersey City Child Development Centers Inc. (JCCDC), an organization that provided early childhood development services and education to under-privileged children, Acting U.S. Attorney William E. Fitzpatrick announced.

Robert E. Mays, 40, previously pleaded guilty before U.S. District Judge Susan D. Wigenton to an information charging him with one count of wire fraud. Judge Wigenton imposed the sentence today in Newark federal court.

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

Mays was the executive director of JCCDC from Sept. 2013 to May 2014. Mays admitted that he stole more than $250,000 from JCCDC by unilaterally increasing his annual salary from $96,500 to $155,000 after being employed by JCCDC for only two months. He also admitted that he created false board of director’s minutes to give the impression JCCDC authorized the salary increase.

In addition, Mays admitted he withdrew funds from a JCCDC bank account to pay for unauthorized personal expenses, including a 2007 Maserati Quattroporte and a fur coat worth thousands of dollars.

In addition to the prison term, Judge Wigenton sentenced Mays to three years of supervised release and ordered him to pay restitution of $257,418.20.

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher, and special agents of the U.S. Department of Health and Human Services, Office of the Inspector General, under the direction of Special Agent in Charge Scott J. Lampert, with the investigation. He also thanked the Hudson County Prosecutor’s Office, under the direction of Prosecutor Esther Suarez, for its assistance.

The government is represented by Assistant U.S. Attorney Mark J. McCarren of the U.S. Attorney’s Office Special Prosecutions Division and Sarah Devlin of the Office’s Asset Forfeiture and Money Laundering Unit in Newark.

Defense counsel: Alexander W. Booth Jr., Union City, New Jersey

NEWARK, N.J. – A Union County, New Jersey, man has been arrested and charged in connection with a bank robbery in Bergen County in January 2017, Acting U.S. Attorney William E. Fitzpatrick announced today.

 

Israel Cosme, 36, of Elizabeth, New Jersey, is charged by complaint with one count of bank robbery. He was originally arrested Jan. 24, 2017 in connection with two bank robberies he allegedly committed in Maryland. He appeared this afternoon before U.S. Magistrate Judge Michael A. Hammer in Newark federal court and was detained.

 

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

 

On Jan. 15, 2017, Cosme allegedly robbed a TD Bank in Little Ferry, New Jersey. According to bank employees and video surveillance, a man wearing blue jeans, tan work boots, a gray hooded sweatshirt, and a knit cap entered the bank. The robber approached one of the bank tellers and handed her a note demanding money. The robber then told the bank teller that he was carrying a weapon in his pocket and that he would shoot her if she did not comply with his demands. He then reached over the counter, grabbed the teller by the shirt, and forcibly grabbed money out of her hand. The robber was later identified as Cosme.

 

When law enforcement apprehended Cosme outside of a hotel room in Maryland and searched his hotel room pursuant to a search warrant, they recovered a pair of blue jeans and a gray hooded sweatshirt that resembled the clothing he was wearing during the robbery.

 

The bank robbery charge carries a maximum potential penalty of 20 years in prison and a $250,000 fine.

 

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation. He also thanked the Little Ferry Police Department, under the direction of Chief Ralph Verdi, for its assistance.

 

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

 

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

 

Defense counsel: K. Anthony Thomas Esq., Assistant Federal Public Defender, Newark

NEWARK, N.J. – An investment manager with an office in Short Hills, New Jersey, was sentenced today to 33 months in prison for that he fraudulently inducing investments, concealing investment losses, and diverting more than $675,000 in investor money for his own use, Acting U.S. Attorney William E. Fitzpatrick announced.

 

Mark Moskowitz, 48, of Short Hills, previously pleaded guilty before U.S. District Judge Katharine S. Hayden to an information charging him with one count of wire fraud. Judge Hayden imposed the sentence today in Newark federal court.

 

In a separate legal proceeding, the N.J. Bureau of Securities ordered Moskowitz and his trading company, Edge Trading LLC, to pay a $1 million civil penalty for selling unregistered fraudulent securities and misusing investors’ funds for personal expenses.

 

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

 

Moskowitz controlled an investment fund under the names Edge Trading Partners L.P. and Edge Trading LLC (Edge Trading). In addition to touting his investment skill and experience, Moskowitz concealed losses from investors and falsely told them that Edge Trading was growing year after year. Based on these misrepresentations, investors continued to entrust additional funds to Moskowitz and left previous investments under his control.

 

Edge Trading was an investment fund that Moskowitz created and operated, starting in or around 2012. Moskowitz told investors that Edge Trading was invested in U.S. and foreign equities, futures contracts, and option contracts and that the fund’s investments continued to show positive returns. In reality, Moskowitz redirected investor money to his personal use, which he concealed from the investors.

 

In addition to the prison term, Judge Hayden sentenced Moskowitz to three years of supervised release and ordered restitution and forfeiture of $694,577.

 

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher, with the investigation leading to today’s sentencing. He also thanked the N.J. Bureau of Securities in the State Attorney General’s Office, under the direction of Attorney General Christopher S. Porrino and Acting Bureau Chief Amy Kopleton, for its assistance in the investigation.

 

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: David Holman Esq., Assistant Federal Public Defenders, Newark

TRENTON, N.J. – A Monmouth Beach, New Jersey, man will appear in federal court today to face allegations that he robbed an Investors Bank in Navesink, New Jersey, on July 20, 2017, Acting U.S. Attorney William E. Fitzpatrick announced.

 

Martin Racioppi, 52, is charged by complaint with one count of bank robbery. He is expected to appear this afternoon before U.S. Magistrate Judge Lois H. Goodman in Trenton federal court.

 

According to the complaint, Racioppi entered an Investors Bank on July 20, 2017, verbally demanded money from a teller, and fled after the teller gave him cash. Racioppi was arrested a day later in Eatontown, New Jersey, on July 21, 2017.

The bank robbery charge carries a maximum potential penalty of 20 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense.

Racioppi has two prior bank robbery convictions, including a federal conviction in 2007.

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, Newark Division, Red Bank Resident Agency, Jersey Shore Gang and Criminal Enterprise Task Force (to include representatives from Bradley Beach Police Department, Brick Police Department, Marlboro Police Department, Monmouth County Sheriff’s Office, and Toms River Police Department), under the direction of Special Agent in Charge Timothy Gallagher; the Middletown Township Police Department, under the direction of Chief Craig Weber; the Monmouth County Prosecutor’s Office, under the direction of Monmouth County Prosecutor Christopher J. Gramiccioni; the Monmouth Beach Police Department, under the direction of Chief Thomas C. Walsh; the Atlantic Highlands Police Department, under the direction of Chief Jerry Vasto; and the Eatontown Police Department, under the direction of Chief Michael D. Goldfarb; with the investigation leading to Racioppi’s arrest.

The government is represented by Assistant U.S. Attorney Fabiana Pierre-Louis, Attorney-in-Charge of the U.S. Attorney’s Office Trenton Branch.

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

Defense counsel: Brian P. Reilly Esq., Assistant Federal Public Defender, Trenton

TRENTON, N.J.  - An Indiana man today admitted transporting weapons to New Jersey in connection with illegal firearms trafficking and sales activity he conducted on an underground, internet based marketplace known as Alphabay, Acting U.S. Attorney William E. Fitzpatrick announced.

Benjamin Donald Brunni, 19, of Greensburg, Indiana, pleaded guilty before U.S. District Judge Brian R. Martinotti in Trenton federal court to an information charging him one count of transporting and selling firearms without a license. 

Co-defendant Nicholas Michael Albertson, 20, of Columbus, Indiana, pleaded guilty to the same offense on July 14, 2017. The arrests of Brunni and Albertson stemmed from a larger law enforcement operation initiated by the U.S. Department of Homeland Security that targeted illegal activities conducted through the dark net since 2013.

“This case highlights the danger posed by dark net marketplaces that offer one-stop anonymous shopping for criminal services,” Acting U.S. Attorney Fitzpatrick said. “A brief series of online communications was all it took to negotiate an $7,550 illicit firearms purchase and send Brunni and Albertson from Indiana to New Jersey to deliver an arsenal of assault rifles and untraceable handguns. Thankfully, a sophisticated undercover operation intercepted the guns and put these two out of business.”

“This guilty plea serves as a stern warning about the consequences awaiting arms traffickers who think the dark net is a safe haven to conduct illegal activities,” said Debra Parker, Acting Special Agent in Charge of Department of Homeland Security, Homeland Security Investigations (HSI) in Newark. “HSI will continue to work with its law enforcement partners to hold criminals who use anonymous internet software for illegal activities accountable for their actions.”

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

Beginning in April 2013, HSI special agents conducted an undercover investigation of illicit sales activity on various dark net internet platforms. During the course of the investigation, Alphabay was identified as a website that provided a platform for vendors and buyers to conduct anonymous online transactions involving the sale of a variety of illegal goods, including firearms, ammunition, explosives, narcotics, and counterfeit items. 

Unlike mainstream e-commerce websites, Alphabay was only accessible via the “Tor” network, which enabled its users to conceal their identities and physical locations. Although Tor has known legitimate uses, it is also used by cybercriminals seeking anonymity during illicit online activities.

During the course of the investigation, HSI agents learned that Brunni maintained a profile on Alphabay in which he expressed interest in the sale and purchase of firearms and ammunition. For approximately one month, Brunni negotiated with an undercover officer, whom he believed was an international purchaser of firearms, for the sale of numerous semi-automatic handguns and rifles. 

Ultimately, Brunni agreed to sell 10 firearms to the undercover officer, including eight Glock-model semi-automatic handguns with obliterated serial numbers and two semi-automatic rifles for $7,550. Brunni also agreed to transport the weapons from his home in Indiana to New Jersey to complete the transaction. 

On Sept. 9, 2016, Brunni and Albertson traveled to the meeting spot at a truck stop in Phillipsburg, New Jersey, and were subsequently arrested. Law enforcement agents recovered a loaded Smith & Wesson Model 5906 S-A Pistol in the vicinity of the Mercedes driver’s seat, as well as three Glock Model 22 Pistols, one Glock Model 17 Gen 4 Pistol, one Glock Model 20 Pistol, one Glock Model 26 Gen 4 Pistol, one Glock Model 30 Pistol, one Glock Model 34 Pistol, one Rugar AR-556 assault rifle, and one Anderson Mfg. AM-15 assault rifle. The serial numbers from each of the Glock handguns were obliterated and unrecognizable.      

The unlicensed sale and weapons transportation charge carries a maximum potential penalty of five years in prison and a $250,000 fine. Sentencing for Brunni and Albertson is scheduled for Nov. 28, 2017 and Nov. 13, 2017, respectively.

U.S. Attorney Fitzpatrick credited special agents of the Department of Homeland Security, Homeland Security Investigations, under the direction of Special Agent in Charge Debra Parker in Newark, Homeland Security Investigations Indianapolis, under the direction of Special Agent in Charge Resident Agent in Charge Gary Woolf, officers of the N.J. State Police under the direction of Col. Joseph R. Fuentes, and officers of the Greenfield Police Department, Indiana, under the direction of Chief Jeff Rasche, with the investigation.

The government is represented by Assistant U.S. Attorney Dennis C. Carletta of the U.S. Attorney's Office's National Security Unit in Newark.

Defense Counsel: Brunni: Brian J. Neary Esq., Hackensack, New Jersey
Albertson: Assistant Federal Public Defender Carol Gillen Esq., Newark

NEWARK, N.J. – A Jersey City, New Jersey, man was sentenced today to 63 months in prison for his role in two separate conspiracies: one to create and operate a website that sold high-quality, custom-made fake identification documents, some of which were later used to commit financial crimes, and a second to fraudulently obtain tax refund checks, Acting U.S. Attorney William E. Fitzpatrick announced.

 

Ricardo Rosario, 34, previously pleaded guilty before U.S. District Judge Jose L. Linares in Newark federal court to an information charging him with conspiracy to commit fraud in connection with authentication features and conspiracy to submit false claims to the U.S. Government. Judge Linares imposed the sentence today in Newark federal court.

 

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

 

From October 2012 through August 2014, Rosario, with the assistance of Abraham Corcino, 34, of Jersey City, and Alexis Scott Carthens, 38, of Newark, sold fake driver’s licenses over the Internet, running a website that was available at “fakeidstore.com” and “fakedlstore.com.” A number of the fake driver’s licenses sold by Rosario and other conspirators were used in connection with “cash out” schemes, where stolen credit card information, usually obtained through hacking or ATM skimming operations, was encoded on to counterfeit credit cards and used to steal cash from victims’ accounts.

 

Rosario created and ran the website. Corcino and Carthens assisted him by creating and mailing the fake driver’s licenses purchased through the website. Corcino also maintained an Instagram account to promote the website. The website sold fake New Jersey, Florida, Illinois, Pennsylvania, Rhode Island, and Wisconsin driver’s licenses, and the website boasted that the licenses had “scannable barcodes” and “real” holographic overlays. The price for each fake driver’s license was approximately $150, but the website offered bulk pricing for orders of 10 or more.

 

The website allowed its users to pay by bitcoin, a cryptographic-based digital currency, or MoneyPak, a type of prepaid payment card that could be purchased at retail stores. The “FAQ” section of the website indicated that orders would be received approximately one to two days after payment was received and described the website’s policy with respect to returns: “No Refunds. No snitching.”

 

In the Stolen Identity Refund Fraud (SIRF) conspiracy, Rosario assisted Carthens, who obtained stolen personally identifiable information (PII) primarily in the form of lab testing request forms that he purchased from another individual. Rosario provided Carthens with email accounts and drop addresses used in furtherance of the scheme. The email accounts were used to register accounts for online tax filing services and prepaid card accounts used to apply for and receive the tax refunds. The drop addresses were used to physically receive the refunds in the form of prepaid debit cards.

 

In addition to the prison term, Judge Linares sentenced Rosario to three years of supervised release and ordered forfeiture of $232,660 and restitution of $121,922.

 

Corcino was sentenced on April 17, 2017, to three years of probation. Carthens pleaded guilty to his role in the scheme on April 25, 2016, and is scheduled to be sentenced Sept. 28, 2017.

 

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, inspectors of the U.S. Postal Inspection Service, under the direction of Inspector in Charge James V. Buthorn, and special agents of IRS – Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen, with the investigation leading to today’s sentencing.

 

The government is represented by Assistant U.S. Attorney Zach Intrater of the Economic Crimes Unit and Barbara Ward, Acting Chief of the U.S. Attorney’s Office Asset Forfeiture and Money Laundering Unit in Newark.

 

Defense counsel: Brian Neary Esq., Hackensack, New Jersey

NEWARK, N.J. – A Newark man was sentenced today to 45 months in prison for robbing a Valley National bank in Belleville, New Jersey, in April 2016, Acting U.S. Attorney William E. Fitzpatrick announced.

 

Donald Myer, 60, previously pleaded guilty before U.S. District Judge Jose L. Linares to an information charging him with one count of bank robbery. Judge Linares imposed the sentence today in Newark federal court.

 

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

 

Myer admitted that during the robbery, he passed a note to a bank employee in which demanded money and threatened that he would use a gun.

 

In addition to the prison term, Judge Linares sentenced Myer to three years of supervised release and ordered him to pay $1,000 in restitution.

 

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation leading to today’s guilty plea. He also thanked the Belleville, Kearny, and Port Authority police departments for their contributions to the case.

The government is represented by Assistant U.S. Attorney Veronica Allende of the U.S. Attorney’s Office in Trenton.

Two members of a scheme that used secret card-reading devices and pinhole cameras on PNC and Bank of America ATMs to steal at least $428,581 pleaded guilty to conspiracy to commit bank fraud today in federal court.

Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, Acting U.S. Attorney William E. Fitzpatrick of the District of New Jersey and Acting Special Agent in Charge Debra Parker of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI) Newark Division made the announcement.

Stefan Dumitru, 29, of Queens, New York, and Florian Calin Crainic, 47, of Des Plaines, Illinois, pleaded guilty before U.S. District Judge Esther Salas to separate criminal informations charging them each with one count of conspiracy to commit bank fraud.

According to admissions made in court in connection with their guilty pleas, Dumitru, Crainic, and others sought to defraud financial institutions and their customers by illegally obtaining customer account information, including account numbers and personal identification numbers. Dumitru and Crainic both admitted that between March 2015 and July 2016, they made unauthorized cash withdrawals using the counterfeit ATM cards.

Sentencing for both defendants is set for November 6.

Joel Abel Garcia, Victor A. Hanganu, Radu Bogdan Marin, Marcel Peckham, Catalin Mihai Dragomir, Eduard Vasilica Ticu and Silvester Florentin Papp previously pleaded guilty to their roles in the scheme and await sentencing. To date, nine of the 13 defendants charged in this matter have been convicted.

ICE-HSI’s Newark Division; U.S. Secret Service’s Boston Field Office; Longmeadow, Massachusetts Police Department; Cambridge, Massachusetts Police Department; and Medford, Massachusetts Police Department investigated the case with assistance from Bank of America Security and Fraud Section and PNC Bank Security Division. The Middlesex County, Massachusetts District Attorney’s Office; U.S. Attorney’s Office of the Eastern District of New York and U.S. Attorney’s Office of the District of Massachusetts Springfield Division assisted in the investigation and prosecution.

The prosecution is being handled by Assistant U.S. Attorney Kelly Graves of the U.S. Attorney’s Office Criminal Division in Newark and Trial Attorney Marianne Shelvey of the Criminal Division Organized Crime and Gang Section.

NEWARK, N.J. – Two members of a scheme that used secret card-reading devices and pinhole cameras on PNC and Bank of America ATMs to steal at least $428,581 pleaded guilty today in Newark federal court.

Acting U.S. Attorney William E. Fitzpatrick of the District of New Jersey; Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division; and Acting Special Agent in Charge Debra Parker of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI) Newark Division made the announcement.

Stefan Dumitru, 29, of Queens, New York, and Florian Calin Crainic, 47, of Des Plaines, Illinois, pleaded guilty before U.S. District Judge Esther Salas to separate informations charging them each with one count of conspiracy to commit bank fraud.

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

Dumitru, Crainic, and others sought to defraud financial institutions and their customers by illegally obtaining customer account information, including account numbers and personal identification numbers. Dumitru and Crainic both admitted that between March 2015 and July 2016, they made unauthorized cash withdrawals using the counterfeit ATM cards.

The conspiracy to commit bank fraud charge carries a maximum potential penalty of 30 years in prison and a $1 million fine. Sentencing for both defendents is set for Nov. 6, 2017.

Joel Abel Garcia, Victor A. Hanganu, Radu Bogdan Marin, Marcel Peckham, Catalin Mihai Dragomir, Eduard Vasilica Ticu, and Silvester Florentin Papp previously pleaded guilty to their roles in the scheme and await sentencing. To date, nine of the 13 defendants charged in this matter have been convicted.

ICE-HSI’s Newark Division; U.S. Secret Service’s Boston Field Office; Longmeadow, Massachusetts, Police Department; Cambridge, Massachusetts, Police Department; and Medford, Massachusetts, Police Department investigated the case with assistance from Bank of America Security and Fraud Section and PNC Bank Security Division. The Middlesex County, Massachusetts, District Attorney’s Office; U.S. Attorney’s Office of the Eastern District of New York and U.S. Attorney’s Office of the District of Massachusetts Springfield Division assisted in the investigation and prosecution.

The government is represented by Assistant U.S. Attorney Kelly Graves of the U.S. Attorney’s Office Criminal Division in Newark and Trial Attorney Marianne Shelvey of the Justice Department’s Criminal Division Organized Crime and Gang Section.

Defense counsel:

Dumitru: Roy Greenman Esq., Union, New Jersey

Crainic: Anthony Iacullo Esq., and Joshua Reinitz Esq., Nutley, New Jersey

CAMDEN, N.J. – A Gloucester County, New Jersey, man was sentenced today to 114 months in prison for being a previously convicted felon in possession of a weapon, Acting U.S. Attorney William E. Fitzpatrick announced.

Darius A. Robinson, 35, of Westville, previously pleaded guilty before Judge Noel L. Hillman to Count 2 of an indictment charging him with being a felon in possession of a weapon. Judge Hillman imposed the sentence today in Camden federal court.

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

On Feb. 11, 2016, Robinson was arrested while in possession of a Titan .25-cal. handgun in Gloucester County. Robinson had previously been convicted on drug charges and sentenced to three years in prison.

In addition to the prison term, Judge Hillman sentenced Robinson to three years of supervised release.

Acting U.S. Attorney Fitzpatrick credited special agents of the ATF, under the direction of Special Agent in Charge John B. Devito, Newark Field Division, with the investigation leading to today’s sentencing.

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

NEWARK, N.J. –The sole proprietor of two companies that purportedly provided printing and digital marketing services to the Newark Watershed Conservation and Development Corporation (NWCDC) was sentenced today to 18 months in prison for defrauding the agency, Acting U.S. Attorney William E. Fitzpatrick announced.

Kevin Gleaton, 53, of West Orange, New Jersey, previously pleaded guilty before U.S. District Judge Jose Linares to an information charging him with one count of conspiring to commit wire fraud with Donald Bernard Sr., Linda Watkins Brashear, and others, to defraud the NWCDC of money and property and one count of misuse of Social Security numbers in connection with personal bankruptcy proceedings. Judge Linares imposed both sentences today in Newark federal court.

According to documents filed in these cases and statements made in court:

From May 2011 to September 2012, Gleaton conspired with Bernard, who was then employed as manager of Special Projects for the NWCDC, Brashear who was then the NWCDC executive director, and others, to defraud the NWCDC of more than $110,000 for work that was never performed by Gleaton or his companies. Gleaton was the owner of the Synergy Group, a company that received more than $58,000 in 2011 from the NWCDC, purportedly for printing services, as well as Mindshare Media, which received more than $52,000 from the NWCDC in 2012, purportedly for digital marketing services.

Gleaton deposited the payments issued to his companies by the NWCDC on the basis of fraudulent invoices, and then provided a substantial portion of the money received – more than $97,000 – to Bernard, who, in turn, shared a portion with Brashear, among others. Gleaton provided the money to Bernard either directly, or indirectly through the “consultant intermediary,” an individual who operated a firm that provided consulting services to the NWCDC. The conspiracy was facilitated by interstate wire transmissions, including emails sent by Bernard to Brashear and the consultant intermediary. Brashear pleaded guilty in December 2015 to scheming to defraud the NWCDC of her honest services in the affairs of the NWCDC by taking kickbacks (from various vendors including Gleaton), and of the NWCDC’s money and property, as well as to subscribing to a false federal personal income tax return. In January 2016, Bernard pleaded guilty to Counts 9 and 10 of a 20-count indictment returned in December 2014, charging him with the use of interstate facilities to promote and facilitate bribery in violation of the Travel Act, and Count 1 of an information that charged him with making and subscribing a false personal tax return.

Gleaton also admitted to using multiple Social Security numbers, other than the number lawfully issued to him by the Commission of Social Security, in connection with his bankruptcy filings in 2011 and 2012.

In addition to the prison term, Judge Linares sentenced Gleaton to three years of supervised release and ordered him to pay restitution of $111,600.

Bernard was sentenced by Judge Linares on July 13, 2017, to eight years in prison. Watkins Brashear is scheduled to be sentenced Sept. 11, 2017.

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI’s Newark Field Office, under the direction of Special Agent in Charge Timothy Gallagher; the Social Security Administration, Office of the Inspector General, Office of Investigations, New York Field Division, under the direction of Special Agent in Charge John Grasso; U.S. Department of Housing and Urban Development Office of Inspector General, Newark office, under the direction of Special Agent in Charge Christina Scaringi; IRS–Criminal Investigation, Newark Field Office, under the direction of Special Agent in Charge Jonathan D. Larsen; and criminal investigators of the U.S. Attorney’s Office, with the investigation. Acting U.S. Attorney Fitzpatrick also thanked the N.J. Office of the State Comptroller, under the direction of State Comptroller Philip James Degnan, for its assistance.

The government is represented by Assistant U.S. Attorneys Jacques Pierre and Leslie Schwartz of the U.S. Attorney’s Office Special Prosecutions Division.

NEWARK, N.J. – Three Jersey City police officers today admitted participating in a conspiracy to defraud Jersey City by obtaining compensation for off-duty work that they did not perform, Acting U.S. Attorney William E. Fitzpatrick announced. 

James Cardinali, 38, of Jersey City, Victor Sanchez, 37, of Hasbrouck Heights, and Christopher Ortega, 29, of Brick, all pleaded guilty before U.S. District Judge John Michael Vazquez in Newark federal court to separate informations charging them with one count each of conspiracy to commit fraud.

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

Cardinali’s duties included serving as the “pick coordinator” for Jersey City’s South District, responsible for assigning police officers to off-duty details. On multiple occasions, Cardinali asked representatives of certain vendors who were performing work in the South District to sign Jersey City off-duty vouchers indicating that a police officer had completed an off-duty assignment for that vendor, even though no officer had in fact completed any assignment. Cardinali then falsely represented on these vouchers that a particular police officer had completed an off-duty assignment. These officers were paid for work they did not perform. Cardinali personally obtained from the officers some of the money that they were paid as a result of the fraudulent conduct.

Sanchez and Ortega defrauded Jersey City by consenting to the submission of false and fraudulent off-duty vouchers to Jersey City indicating that they had completed certain off-duty assignments that they had not, in fact, completed. Both were paid by the city for off-duty assignments that they did not actually complete. 

All three officers face a maximum potential penalty of five years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. Pursuant to the plea agreement, Cardinali is required to forfeit the $39,587; Sanchez is required to forfeit $21,583; and Ortega is required to forfeit $18,336.  Sentencing for all three defendants is scheduled for Nov. 6, 2017.

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation. The Jersey City Police Department is cooperating with the investigation.   

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

Defense counsel: Cardinali: Matthew E. Beck Esq., West Orange, New Jersey
Sanchez: Joel Silberman Esq., Jersey City, New Jersey
Ortega: Henry Klingeman Esq., Newark, New Jersey

NEWARK, N.J. – A Bronx, New York, man today admitted robbing a bank in Bergen County, New Jersey, in January 2017, Acting U.S. Attorney William E. Fitzpatrick announced.

 

Andres Dominguez, 38, pleaded guilty before U.S. District Judge William H. Walls in Newark federal court to an information charging him with one count of bank robbery.

 

According to documents filed in this case and statements made in court, Dominguez admitted that he robbed a Bank of New Jersey in Fort Lee, New Jersey, on Jan. 12, 2017, while brandishing a large knife.

 

The bank robbery charge carries a maximum potential penalty of 20 years in prison and a $250,000 fine. Sentencing is scheduled for Oct. 31, 2017.

 

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation. He also thanked the Fort Lee Police Department, under the direction of Chief Keith M. Bendul, for its contribution to the case.

 

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: Carol Gillen Esq., Assistant Federal Public Defender, Newark

NEWARK, N.J. – A Florida man was sentenced today to 73 months in prison for his role in a conspiracy to possess and traffic stolen credit card data held by New Jersey residents, Acting U.S. Attorney William E. Fitzpatrick announced.

 

Miguel Gonzalez, 43, of Miami, Florida, previously pleaded guilty before U.S. District Court Judge Esther Salas to an information charging him with one count of conspiracy to commit wire fraud. Judge Salas imposed the sentence today in Newark federal court.

 

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

 

Between January 2010 and July 2013, Gonzalez obtained and possessed stolen credit card data for more than 114,000 credit card accounts. Gonzalez purchased the stolen credit card information from various vendors who advertise and transmit the data over the Internet using email and instant chat software. These vendors sold stolen credit card data obtained from network intrusions into various corporate victims, including major retailers in the state of New Jersey. The stolen credit card data was used by Gonzalez and others to create counterfeit credit cards, which were used to enter into unauthorized and fraudulent transactions. The credit card issuers associated with the more than 114,000 stolen credit card accounts suffered a combined loss of more than $23 million.

 

In addition to the prison term, Judge Salas sentenced Gonzalez to five years of supervised release, fined him $100,000 and ordered him to forfeit a number of items, including a house, boat, car and $30,000 in jewelry.

 

Acting U.S. Attorney Fitzpatrick credited agents of the U.S. Secret Service, under the direction of Special Agent in Charge Mark McKevitt; and special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen, with the investigation leading to today’s sentencing.

 

The government is represented by Assistant U.S. Attorneys Paul A. Murphy, Chief of the U.S. Attorney’s Office’s Economic Crimes Unit, and Dara Aquila Govan.

 

Defense counsel: Ricardo P. Hermida Esq., Miami

NEWARK, N.J. – A North Caldwell, New Jersey, man was sentenced today to 39 months in prison for fraudulently using more than $550,000 in investment funds that he solicited to purchase and sell consumer products in bulk, Acting U.S. Attorney William E. Fitzpatrick announced.

Michael Esposito, 45, previously pleaded guilty before U.S. District Judge William J. Martini to an information charging him with one count of wire fraud. Judge Martini imposed the sentence today in Newark federal court.

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

From August 2013 through February 2017, Esposito was the president of numerous entities that purported to purchase consumer products in bulk from manufacturers for resale to wholesalers and retailers. Esposito told potential investors that he could purchase consumer goods – such as soda and bottled water – at substantial discounts, and that he had buyers ready to purchase the products at a significant profit.

In return for providing the funds necessary to purchase the products, Esposito promised the victim investors a large percentage of the profits. However, Esposito used the funds for his personal expenses and to pay other investors in order to make it appear the money was properly used. Esposito admitted that his actions resulted in losses of more than $550,000.

In addition to the prison term, Judge Martini sentenced Esposito to three years of supervised release. Restitution will be determined at a late date.

Acting U.S. Attorney Fitzpatrick credited special agents with the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation. He also thanked investigators with the Florida Office of Financial Regulation for their assistance.

The government is represented by Assistant U.S. Attorneys Andrew Kogan of the U.S. Attorney’s Office Economic Crimes Unit and Sarah Devlin of the Asset Forfeiture Unit in Newark.

Defense counsel: Brooke M. Barnett Esq., Newark

NEWARK, N.J. – A Passaic County, New Jersey, man today admitted his role in a scheme to defraud a trucking company out of more than $900,000, Acting U.S. Attorney William E. Fitzpatrick announced.

Angel D. Vidal, 25, of Paterson, New Jersey, pleaded guilty before U.S. District Judge Madeline Cox Arleo in Newark federal court to Count 1 of an indictment charging him with wire fraud.

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

Lisa Popewiny, 55, of Clifton, New Jersey, was the payroll clerk at Clifford B. Finkle Jr. Inc., a Clifton-based company that provided transportation and freight services to various public and private entities located in New Jersey, New York, and elsewhere. From June 2012 to April 2015, Popewiny, Vidal, and his two brothers, Angel Gabriel Vidal, 23, and Miguel Vidal, 23, a former truck driver for the company, engaged in a scheme to defraud the company out of $920,380. On June 26, 2017, Angel Gabriel Vidal pleaded guilty before Judge Arleo to Count 2 of an indictment charging him with wire fraud. On March 30, 2017, Miguel Vidal pleaded guilty to an information charging him with wire fraud. Popewiny is scheduled to stand trial on Oct. 2, 2017.

Popewiny allegedly falsified payroll records in order to generate fraudulent paychecks payable to non-existent employees, including the Vidal brothers. All of the Vidal brothers have admitted to allowing the use of their personal identifying information to generate the fraudulent paychecks. The three men then converted the checks, many of which were deposited into their bank accounts and then funneled out of the accounts in cash. Miguel Vidal admitted to recruiting other individuals to provide their personal information so that Popewiny could allegedly falsely add them to the payroll. Over the course of the scheme, Popewiny allegedly input false hours for at least 12 different individuals. The scheme came to light when owners of the company, in an effort to investigate suspected fraud, distributed the payroll checks to employees – a task normally completed by Popewiny. After all of the payroll checks had been distributed, several paychecks remained unclaimed that turned out to be fraudulently issued.

The charge to which Angel D. Vidal and his brothers pleaded guilty carries a maximum punishment of 20 years in prison and a fine of $250,000 or twice the gross gain or loss from the offense. Sentencing is scheduled for Nov. 17, 2017.

Acting U.S. Attorney William E. Fitzpatrick credited criminal investigators in the U.S. Attorney’s Office and postal inspectors from the U.S. Postal Inspection Service, under the direction of Inspector in Charge James V. Buthorn, with the investigation leading to the guilty pleas.

The government is represented by Assistant U.S. Attorney Cari Fais of the U.S. Attorney’s Office Special Prosecutions Division.

The charges and allegations against Popewiny are merely accusations, and she is presumed innocent unless and until proven guilty.

NEWARK, N.J. – A Newark police officer today admitted conspiring to fraudulently obtain payments under the federal public housing assistance program known as “Section 8,” Acting U.S. Attorney William E. Fitzpatrick announced.

Luis Cancel, 50, pleaded guilty before U.S. District Judge Jose L. Linares in Newark federal court to an information charging him with one count of agreeing with another individual to obtain Section 8 public housing benefits to which they were not entitled.   

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

The Section 8 Program is a federal public housing assistance program administered by the U.S. Department of Housing and Urban Development (HUD). It provides rent subsidies to qualified low-income individuals. HUD provided federal grant money to the Newark Housing Authority (NHA) for the Section 8 Program. Under the NHA’s Section 8 Program, a tenant’s rental assistance was based upon the tenant’s anticipated family gross income. Tenants receiving Section 8 assistance from the NHA had to inform the NHA of all members of the household and the annual household income.

From January 2010 to May 2015, Cancel, then a Newark police officer, lived with another person (Individual 1) who was receiving Section 8 benefits. Cancel and the other individual agreed not to disclose to the NHA that they were living together or that Cancel was a Newark police officer, and, also, a security guard with the Robert Treat Hotel. Individual 1 submitted fraudulent documents to the NHA that failed to disclose these facts. Cancel also submitted letters to the NHA falsely indicating that he lived at a separate residence. Based upon their misrepresentations, Cancel and Individual 1 received approximately $74,000 in Section 8 subsidies to which they were not entitled.

The count to which Cancel pleaded guilty carries a maximum penalty of five years in prison and a $250,000 fine. Sentencing is scheduled for Nov. 6, 2017. 

Acting U.S. Attorney Fitzpatrick credited special agents of the U.S. Department of Housing and Urban Development, Office of Inspector General, under the direction of Special Agent in Charge Christina Scaringi, with the investigation leading to today’s plea.

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: Joseph D. Rotella Esq., Newark

NEWARK, N.J. – A leader of the Sex Money Murder set of the Bloods street gang was sentenced today to 144 months in prison for his role in a racketeering conspiracy that involved murder, attempted murder, conspiracy to commit murder, and conspiracy to distribute heroin, Acting U.S. Attorney William E. Fitzpatrick announced.

 

Rajohn Wilson, a/k/a “1090,” 26, of Newark, previously pleaded guilty before U.S. District Judge Susan D. Wigenton to Count Two of a superseding indictment charging him with racketeering conspiracy. Judge Wigenton imposed the sentence today in Newark federal court.

 

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

 

The Bloods street gang is organized into subgroups that operate in specific geographic locations. Sex Money Murder is the subgroup that operates primarily in Essex County, New Jersey.

 

Rajohn Wilson – who served as a “five-star general” of Sex Money Murder and is the younger brother of Narik Wilson, a/k/a “Spaz,” the leader or “O.G.” of the gang – admitted that from 2007 to 2011 he committed a series of violent crimes to advance the gang’s objectives.

 

Rajohn Wilson admitted that he conspired with members of Sex Money Murder on Feb. 4, 2007, and Feb. 16, 2007, to murder rival gang members, and that he and others carried out drive-by shootings of two victims in and around Newark. Wilson also admitted conspiring to distribute more than one kilogram of heroin.

 

In addition to the prison term, Judge Wigenton sentenced Wilson to five years of supervised release.

 

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI and the FBI’s Safe Streets Task Force, under the direction of Special Agent in Charge Timothy Gallagher in Newark; the Essex County Prosecutor’s Office, under the direction of Acting Prosecutor Robert D. Laurino; the Essex County Sheriff’s Office, under the direction of Sheriff Armando B. Fontoura; and the Newark Department of Public Safety, under the direction of Anthony F. Ambrose, with the investigation. He also thanked special agents of the Drug Enforcement Administration (DEA), under the direction of Special Agent in Charge Carl J. Kotowski; and special agents of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), under the direction of Special Agent in Charge John B. Devito, for their assistance.

 

The government is represented by Assistant U.S. Attorney Dara Govan and Mary Toscano, Chief of the U.S. Attorney’s Organized Crime/Gangs Unit in Newark.

 

Defense counsel: Howard Brownstein Esq., Union City, New Jersey

TRENTON, N.J. – A former salesman at Bayway Lumber, a Linden, New Jersey, company that sold commercial and industrial products to numerous public and private entities, today admitted his role in a scheme to defraud customers and lying to a federal grand jury, Acting U.S. Attorney William E. Fitzpatrick announced.

Adam Martignetti, 43, of South River, New Jersey, pleaded guilty before U.S. District Judge Peter G. Sheridan in Trenton federal court to Counts 1 and 6 of an indictment charging him with conspiracy to commit wire fraud and making false declarations before a grand jury.  

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

Martignetti admitted that from 2011 through 2013 he conspired with others to defraud certain Bayway Lumber customers by providing free items to customers’ employees and then recouping the cost of the items (plus additional revenue for Bayway Lumber) by overbilling and fraudulently billing the customers. Martignetti also admitted to supplying lower-quality, less expensive plywood to a customer, but charging for the more expensive, higher-quality plywood the customer had ordered.   
 
Martignetti gave a variety of personal items to employees of some of Bayway Lumber’s customers, including Amtrak, the City of Elizabeth, and the Plainfield Board of Education.  These items included a laptop, several iPads, a camera and sound system, patio furniture, and other merchandise. Under the supervision of Robert Dattilo, president and partial owner of Bayway Lumber, Martignetti then overbilled and fraudulently billed those customers. Dattilo kept a running tally of how much Martignetti and others overbilled and fraudulently billed customers, which many at Bayway Lumber referred to as the “Bank,” to ensure that Bayway Lumber recovered the full cost of the free items. Dattilo previously pleaded guilty to conspiracy to commit mail and wire fraud and was sentenced in July 2016 to 48 months in prison and ordered to pay $708,386 in restitution.

Martignetti also conspired to provide one Bayway Lumber customer, Consolidated Edison Co. of New York Inc. (Con Edison), with lower-quality wood than it ordered and paid for. When Con Edison ordered graded plywood, a type of plywood graded by mills that had met a certain set of specifications, Martignetti, at Dattilo’s instruction, routinely sent plywood that was of a lower grade or not graded at all, including “reject” plywood, but charged Con Edison for the higher-quality plywood that it ordered. 

Martignetti also pleaded guilty to falsely testifying before a federal grand jury while appearing as a witness under oath in March 2013 that he had never given Bayway Lumber items to City of Elizabeth employees for free, and that Elizabeth was never charged for items that were for Elizabeth employees’ personal use.   

The conspiracy to commit wire fraud charge to which Martignetti pleaded guilty carries a maximum penalty of 20 years in prison. The charge of knowingly making false statements before a grand jury guilty carries a maximum penalty of five years in prison. Each count also carries a maximum fine of $250,000 or twice the gross gain or loss associated with the offense, whichever is greatest. Sentencing is scheduled for Sept. 28, 2017.

Acting U.S. Attorney Fitzpatrick credited special agents with the Office of Inspector General, U.S. Department of Housing and Urban Development, under the direction of Special Agent in Charge Christina Scaringi; the Office of Inspector General, Amtrak, under the direction of Special Agent in Charge Michael Waters; and the FBI, under the direction of Special Agent in Charge Timothy Gallagher, with the investigation leading to today’s guilty plea.  

The government is represented by Assistant U.S. Attorney Cari Fais of the U.S. Attorney’s Office Special Prosecutions Division, and Assistant U.S. Attorney Barbara R. Llanes, Chief, General Crimes Unit, of the U.S. Attorney’s Criminal Division, in Newark. 

Defense Counsel: Michael Armstrong Esq., Willingboro, New Jersey

NEWARK, N.J. – A Belleville, New Jersey, man was sentenced today to 41 months in prison for his role in a conspiracy to illegally obtain and distribute oxycodone in New Jersey, Acting U.S. Attorney William E. Fitzpatrick announced.

Rickie Horvath, 56, previously pleaded guilty before U.S. District Judge Esther Salas to an indictment charging him with one count of conspiracy to distribute oxycodone. Judge Salas imposed the sentence today in Newark federal court.

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

Using confidential sources, physical surveillance, and recorded text messages and telephone calls, investigators with the Drug Enforcement Administration (DEA) discovered that members and suppliers of a drug-trafficking organization secured prescriptions for oxycodone and other controlled substances from various doctors in New Jersey, filled them at pharmacies in Belleville and elsewhere, and sold the drugs for a profit. The investigation identified Horvath as a member of the drug trafficking organization.

Horvath admitted that from Feb. 5, 2014 to Aug. 13, 2014, he personally went to various doctors’ offices and obtained prescriptions for pills containing oxycodone, had the prescriptions filled, and sold the pills to members of the conspiracy and others. He said that on a single day in June 2014, he traveled to a doctor’s office in Livingston, New Jersey, where he and two conspirators each obtained a prescription for 60 Endocet pills. Horvath and his conspirators dropped off the three prescriptions to be filled by a pharmacy in East Orange, New Jersey. Horvath admitted that he and his two conspirators then found a fourth conspirator to buy the 180 Endocet pills. Horvath and his conspirators traveled to the East Orange pharmacy with the third conspirator buyer, where Horvath used the fourth conspirator’s money to purchase the filled prescriptions. Horvath and his conspirators then sold the 180 Endocet pills to the fourth conspirator.  
 
Oxycodone is a Schedule II controlled substance – meaning that it has a high potential for abuse, a currently accepted medical use with severe restrictions, and abuse of the drug may lead to severe psychological or physical dependence. The Endocet pills obtained and sold by Horvath each contained 10 milligrams of oxycodone.

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

Of the 16 people that have been charged in this conspiracy, 13 have been convicted, including the leader, Victoria Horvath, who was sentenced Oct. 20, 2016 to 92 months in prison. Charges against a defendant who died in April 2014 have been dismissed.

Acting U.S. Attorney Fitzpatrick credited the DEA’s New Jersey Division, under the direction of Special Agent in Charge Carl J. Kotowski, with the investigation.

The government is represented by Assistant U.S. Attorney Sara F. Merin of the OCDETF/Narcotics Unit of the U.S. Attorney’s Office in Newark. The principal mission of the OCDETF program, under which this investigation was conducted, 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.

Defense counsel: Damian Conforti Esq., Newark

TRENTON, N.J. – A former employee of a New Jersey based-trucking company was sentenced today to 33 months in prison for stealing more than $3 million by issuing company checks for her own benefit, Acting U.S. Attorney William E. Fitzpatrick announced.
 
Tracey Perrigan, 55, of Sparta, Tennessee, previously pleaded guilty before U.S. District Judge Peter G. Sheridan to Count One of an indictment charging her with wire fraud. Judge Sheridan imposed the sentence today in Trenton federal court.

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

Perrigan was an employee of a company identified in the indictment as “Company A,” the corporate parent of several subsidiary trucking, rigging, and transportation companies. Company A was headquartered in Oceanside, New York, and had a Branchburg, New Jersey, facility where Perrigan worked.

Company A used the “Comchek” system, which enables clients to authorize and monitor fuel and repair expenditures by drivers in remote locations. As part of her duties, Perrigan was responsible for authorizing Comcheks drawn on Company A’s bank account. From March 2007 through August 2015, Perrigan diverted $3.25 million from her employer to an entity identified as “Company B,” a trucking and towing company based in Tennessee that she owned with another person. Company B never conducted any business with Company A.

In addition to the prison term, Judge Sheridan sentenced Perrigan to three years of supervised release. Perrigan must also pay restitution of $3,251,419.65.   

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation.

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: Carol Gillen Esq., Assistant Federal Public Defender, Newark

An Italian national who smuggled counterfeit electronics, including Apple iPhones, iPads and iPods, from China for sale in the U.S. was sentenced today to 37 months in prison.

Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division; Acting U.S. Attorney William E. Fitzpatrick of the District of New Jersey; Acting Special Agent in Charge Debra Parker of Homeland Security Investigations (HSI) in Newark; and Bergen County Prosecutor Gurbir Grewal made the announcement.

Rosario La Marca, 54, a resident of Naples, Italy, pleaded guilty on February 22, before U.S. District Judge Kevin McNulty to Count One of an indictment charging him with conspiracy to traffic in counterfeit goods, to smuggle goods into the U.S., and to structure financial transactions, and Count Two, charging him with trafficking in counterfeit goods. Judge McNulty imposed the sentence today in Newark federal court.

According to facts admitted during the plea, from July 2009 through February 2014,  La Marca, Andreina Becerra, 32, a Venezuelan national, Roberto Volpe, 35, an Italian national, and Jianhua Li, 42, conspired to smuggle into the U.S. from China more than 40,000 electronic devices and accessories bearing counterfeit Apple and Sony trademarks. The estimated manufacturer’s suggested retail prices for an equivalent number of genuine items would have exceeded $15 million. The devices were shipped separately from the labels bearing counterfeit trademarks in order to avoid detection by U.S. Customs and Border Protection. The devices were then labeled and packaged after they passed through customs.

The defendants then re-shipped the devices to conspirators all over the U.S. Proceeds from the sales of the devices were funneled back to the defendants’ accounts in Florida and New Jersey via structured cash deposits – broken into multiple deposits of less than $10,000 each to avoid bank reporting requirements – and a portion of the proceeds was then transferred to conspirators in Italy, further disguising the source of the funds.

The defendants made more than 100 illegal wire transfers totaling more than $1.1 million to Hong Kong to facilitate their criminal activity.  

In addition to the prison term, Judge McNulty sentenced La Marca to one year of supervised release.

Volpe and Becerra have both pleaded guilty to their roles in the scheme and await sentencing. Li has pleaded not guilty. The charges contained in the indictment against him are merely accusations, and he is presumed innocent unless and until proven guilty.

The case was jointly investigated by the HSI Newark Seaport Investigations Group and the Bergen County Prosecutor’s Office Financial Crimes Unit, with significant assistance from Europol and Italy’s Guardia di Finanza.

The government is represented by Senior Litigation Counsel Leslie Schwartz and Assistant U.S. Attorney Sarah Devlin of the District of New Jersey and Trial Attorney Kebharu Smith of the Criminal Division’s Computer Crime and Intellectual Property Section.

NEWARK, N.J. – An Italian national who smuggled counterfeit electronics, including Apple iPhones, iPads and iPods, from China for sale in the United States was sentenced today to 37 months in prison.

Acting U.S. Attorney William E. Fitzpatrick of the District of New Jersey; Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division; Acting Special Agent in Charge Debra Parker of Homeland Security Investigations (HSI) in Newark; and Bergen County Prosecutor Gurbir Grewal made the announcement.

Rosario La Marca, 54, a resident of Naples, Italy, previously pleaded guilty before U.S. District Judge Kevin McNulty to Count One of an indictment charging him with conspiracy to traffic in counterfeit goods, to smuggle goods into the United States, and to structure financial transactions, and Count Two, charging him with trafficking in counterfeit goods. Judge McNulty imposed the sentence today in Newark federal court.

La Marca, Andreina Becerra, 32, a Venezuelan national, Roberto Volpe, 35, an Italian national, and Jianhua Li, 42, a Chinese national currently residing in California, were originally charged in an eight-count indictment in April 2015 with importing and trafficking fake iPhones, iPads and iPods bearing counterfeit Apple trademarks, and fake camcorders bearing counterfeit Sony trademarks, as well as smuggling, structuring and international money laundering.

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

From July 2009 through February 2014, the defendants conspired to smuggle into the United States from China more than 40,000 electronic devices and accessories. The estimated manufacturer’s suggested retail prices for an equivalent number of genuine items would have exceeded $15 million. The devices were shipped separately from the labels bearing counterfeit trademarks in order to avoid detection by U.S. Customs and Border Protection. The devices were then labeled and packaged after they passed through customs.

The defendants then re-shipped the devices to conspirators all over the United States. Proceeds from the sales of the devices were funneled back to the defendants’ accounts in Florida and New Jersey via structured cash deposits – broken into multiple deposits of less than $10,000 each to avoid bank reporting requirements – and a portion of the proceeds was then transferred to conspirators in Italy, further disguising the source of the funds.

The defendants made more than 100 illegal wire transfers totaling more than $1.1 million to Hong Kong to facilitate their criminal activity.  
 
In addition to the prison term, Judge McNulty sentenced La Marca to one year of supervised release.

Volpe and Becerra have both pleaded guilty to their roles in the scheme and await sentencing. Li has pleaded not guilty. The charges contained in the indictment against him are merely accusations, and he is presumed innocent unless and until proven guilty.

The case was jointly investigated by the HSI Newark Seaport Investigations Group and the Bergen County Prosecutor’s Office Financial Crimes Unit, with significant assistance from Europol and Italy’s Guardia di Finanza.

The government is represented by Senior Litigation Counsel Leslie Schwartz and Assistant U.S. Attorney Sarah Devlin of the District of New Jersey and Trial Attorney Kebharu Smith of the Criminal Division’s Computer Crime and Intellectual Property Section.   

Defense Counsel: Scott D. Finckenauer Esq., Fairview, New Jersey

NEWARK, N.J. – A former contractor of the Newark Watershed Conservation and Development Corporation (NWCDC) was sentenced today to 24 months in prison for his role in a bribery and kickback scheme involving an employee and consultant of the NWCDC, Acting U.S. Attorney William E. Fitzpatrick announced.

James Porter, 80, of East Orange, New Jersey, previously pleaded guilty before U.S. District Judge Jose L. Linares to an information charging him with one count of conspiring with Donald Bernard Sr., a former employee and consultant of the NWCDC, and others, to defraud the NWCDC and one count of tax evasion. Judge Linares imposed the sentence today in Newark federal court.

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

Between October 2008 and April 2013, Porter conspired with Bernard to provide Bernard and others with a stream of concealed, undisclosed kickbacks in exchange for Bernard’s assistance in securing business opportunities and payments to two companies operated by Porter: Jim P. Enterprises LLC (JPE) and New Beginnings Environmental Services (NBES), a company in which Bernard was also a partner.

Both JPE and NBES purported to perform landscaping, snow removal, clean-up and sign posting services to the NWCDC from 2008 through 2013. JPE received payments from the NWCDC totaling more than $500,000 and NBES received approximately $290,000 from the NWCDC. Both companies submitted invoices to the NWCDC that were fraudulently inflated to cover kickback payments to Bernard and billed for some services, such as landscaping and snow removal, which were never performed.

Porter passed a stream of kickback payments to Bernard totaling more than $500,000, which was funded by the proceeds JPE and NBES obtained from the NWCDC, including cash withdrawn from the bank accounts of JPE and NBES totaling $378,867; Bernard’s use of an ATM card issued in his name to withdraw at least $74,681 directly from the NBES bank account; Bernard’s use of the NBES ATM card issued in Bernard’s name to pay personal expenses of nearly $5,000; and checks written from the accounts of JPE and NBES totaling $41,650, which were made payable to Bernard, or to companies he controlled, including a consulting company, Bernard & Associates, and the African American Heritage Parade Committee (AAHPC).

In August 2012, Porter also accepted a $5,000 check payable to JPE from Essex Home Improvements, another contractor of the NWCDC for work that was never performed, and delivered the proceeds to Bernard. The payment from Essex Home Improvements was provided to JPE, rather than to Bernard directly, as a means of concealing a kickback from Essex Home Improvements to Bernard.

From 2009 to 2012, Porter failed to report income of $767,750 from the proceeds that JPE and NBES received from the NWCDC. Porter also pleaded guilty to intentionally underreporting income for the 2012 tax year on his personal tax return by $151,603, resulting in tax due and owing of $48,971.

In addition to the prison term, Judge Linares sentenced Porter to two years of supervised release. Porter must also pay restitution of $711,083, which includes $539,583 towards the NWCDC and $171,500 to the IRS.

Bernard was sentenced by Judge Linares on July 13, 2017 to eight years in prison.

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI’s Newark Field Office, under the direction of Special Agent in Charge Timothy Gallagher; the Social Security Administration, Office of the Inspector General, Office of Investigations, New York Field Division, under the direction of Special Agent in Charge John Grasso; U.S. Department of Housing and Urban Development Office of Inspector General, Newark office, under the direction of Special Agent in Charge Christina Scaringi; IRS–Criminal Investigation, Newark Field Office, under the direction of Special Agent in Charge Jonathan D. Larsen; and criminal investigators of the U.S. Attorney’s Office, with the investigation. Acting U.S. Attorney Fitzpatrick also thanked the N.J. Office of the State Comptroller, under the direction of State Comptroller Philip James Degnan, for its assistance.

The government is represented by Assistant U.S. Attorneys Jacques S. Pierre and Jihee G. Suh of the U.S. Attorney’s Office Special Prosecutions Division in Newark.

Defense counsel: Anthony Mack Esq., Newark

NEWARK, N.J. – A Monsey, New York, man was sentenced today to 13 months in prison for assaulting a woman on a flight from Israel to Newark Liberty International Airport, Acting U.S. Attorney William E. Fitzpatrick announced.

 

Yoel Oberlander, 36, previously pleaded guilty before U.S. District Judge Esther Salas to a superseding information charging him with assault with intent to commit stalking. Judge Salas imposed the sentence today in Newark federal court.

 

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

 

Oberlander admitted that while on an El Al flight from Tel Aviv to Newark on May 29, 2016, he knowingly and intentionally assaulted a woman seated next to him on the plane. He admitted that he touched her in the area of her chest, upper thigh, and hand without her consent, and that he did so with the intent to harass and intimidate her.

 

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

 

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, and the Port Authority of New York-New Jersey, with the investigation.

The government is represented by Assistant U.S. Attorneys Melissa M. Wangenheim and Joyce M. Malliet of the U.S. Attorney’s Criminal Division in Newark.

Defense counsel: Eric Kanefsky Esq., Newark

TRENTON, N.J. – A Trenton man was sentenced today to 60 months in prison for his role in a conspiracy to sell more than 1.5 kilograms of cocaine and more than 87 grams of crack-cocaine in the Trenton area, Acting U.S. William E. Fitzpatrick announced.

William Enmond, 53, previously pleaded guilty before U.S. District Judge Michael A. Shipp to an information charging him with one count of conspiracy to distribute and possess with intent to distribute 500 grams or more of cocaine, and to manufacture, distribute, and possess with intent to distribute 28 grams or more of cocaine base. Judge Shipp imposed the sentence today in Trenton federal court.

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

From September 2013 through his arrest on Jan. 13, 2016, Enmond conspired with co-defendants Bobby Williams, Khalfini Richardson and Capitol T. Wellons to distribute cocaine and crack-cocaine, primarily from two adjacent residences in Trenton. On Sept. 6, 2013, Enmond sold 446.5 grams of cocaine to a confidential informant in exchange for $17,320.

During his plea hearing, Enmond admitted conspiring to distribute and possess with intent to distribute 1.72 kilograms of cocaine and 87.9 grams of crack-cocaine.

Judge Shipp also sentenced Enmond to five years of supervised release.

Acting U.S. Attorney Fitzpatrick credited special agents of the Drug Enforcement Administration (DEA), under the direction of Special Agent in Charge Carl J. Kotowski in Newark, and detectives of the Mercer County Prosecutor’s Office, under the direction of Prosecutor Angelo J. Onofri, with the investigation.

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

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

Defense counsel: Mark G. Davis Esq., Hamilton, New Jersey

NEWARK, N.J. – A member of the International Longshoremen’s Association (ILA) and general foreman for a Port Elizabeth terminal operator was arrested this morning for fraudulently collecting a nearly $500,000 annual salary, much of which was for work he never performed, Acting U.S. Attorney William E. Fitzpatrick announced.

Paul Moe Sr., 66, of Atlantic Highlands, New Jersey, is charged in an indictment with one count of wire fraud conspiracy and 13 substantive counts of wire fraud. He appeared this afternoon before U.S. Magistrate Judge Leda Dunn Wettre in Newark federal court and was released on $250,000 unsecured bond. He will be arraigned at a later date.

According to the indictment:

From September 2015 through March 2017, Moe fraudulently collected a compensation package that paid him almost $500,000 annually while showing up at his job site for as little as eight hours per week. In order for Moe to collect his $9,300 weekly paycheck, other conspirators submitted false timesheets each day on his behalf and even credited him for up to 16 hours of overtime a day. The 13 substantive wire fraud counts consist of one-week increments in which Moe – having either failed to appear at the job site or while being out of state or out of the country – was paid as if he had been on the job for a minimum of 40 hours a week.

Each count is punishable by up to five years in prison and a $250,000 fine. The charges and allegations in the indictment are merely accusations, and Moe is presumed innocent unless and until proven guilty.

Acting U.S. Attorney Fitzpatrick credited special agents and investigators with the U.S. Department of Labor Office of Inspector General, Office of Investigations-Labor Racketeering and Fraud, New York Region, under the direction of Special Agent in Charge Michael C. Mikulka; the Office of Employee Benefit Security Act (EBSA), under the direction of Regional Director Jonathan Kay, the Waterfront Commission of New York Harbor, under the direction of Executive Director Walter M. Arsenault, and the Office of Labor Management Standards, under the supervision of District Director Andriana Vamvakas, with the investigation.

The government is represented by Senior Litigation Counsel V. Grady O’Malley and Special Assistant U.S. Attorney Tracey Agnew.

Defense counsel: Gerald McMahon Esq., New York

TRENTON, N.J. –The owner of a New Jersey trucking company today admitted committing tax evasion and bankruptcy fraud while operating his wine delivery business, Acting U.S. Attorney William E. Fitzpatrick announced.

Giacomo Giorlando, 54, of Morganville, New Jersey, pleaded guilty before U.S. District Judge Peter G. Sheridan in Trenton federal court to an information charging him with three counts of tax evasion and one count of bankruptcy fraud.

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

As an owner of 4 G’s Trucking, Giorlando comingled business revenue with his personal funds, utilized a check casher to cash business checks, deposited the proceeds of his business into various bank accounts, and then significantly inflated expenses to reduce his taxable income for the years 2011, 2012 and 2014. He admitted he was responsible for a $460,012 tax loss from those three years.

In addition, when Giorlando filed for bankruptcy in May 2014, he failed to accurately report his assets from at least 10 accounts at TD Bank and one account at Provident Bank that he maintained during the time frame covered by the bankruptcy. The bankruptcy was approved based upon this false and incomplete information. He was discharged on March 13, 2015.

The tax evasion and bankruptcy charges each carry a maximum potential penalty of five years in prison and a $250,000 fine. Sentencing is set for Nov. 17, 2017.

Acting U.S. Attorney Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher, and IRS–Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen, with the investigation.

The government is represented by Senior Litigation Counsel V. Grady O’Malley of the U.S. Attorney’s Office’s Criminal Division in Newark.

Defense counsel: Rocco C. Cipparone Jr. Esq., Haddon Heights, New Jersey

NEWARK, N.J. – A New Brunswick, New Jersey, man today admitted defrauding a bank by fraudulently using a federally-backed $2 million small business loan on personal expenses, Acting U.S. Attorney William E. Fitzpatrick announced.

John Cheng, 58, of New Brunswick, New Jersey, pleaded guilty before U.S. District Judge Claire C. Cecchi in Newark federal court to an information charging him with loan application fraud.

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

On Dec. 7, 2007, Cheng submitted a Small Business Administration (SBA) loan application for $1.75 million and a commercial loan application for $2 million, purportedly for financing relating to a restaurant in Skillman, New Jersey.

The loan applications were submitted to an independent lender through the SBA Loan Guaranty Program, which authorizes the SBA to provide financial assistance to eligible small businesses through loan guarantees to participating lenders. Rather than loan money directly to small businesses, the SBA provided a guaranty to the independent lender that the SBA would repay a percentage of a loan in the event that a borrower defaulted.

Cheng’s SBA loan application falsely stated that the loan would be used for construction, acquisition of machinery and equipment, and working capital. After receiving $2,082,229 from the victim bank in March 21, 2008, Cheng used the funds for his own benefit, including paying off gambling debts, sending money to family members, and paying a federal tax bill.

The charge to which Cheng pleaded guilty is punishable by a maximum potential penalty of 30 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. Under his plea agreement, Cheng must pay restitution of $2,657,687.15 to the bank he defrauded and forfeit $1,696,506. Sentencing is scheduled for Oct. 25, 2017.

 

Acting U.S. Attorney William E. Fitzpatrick credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation. He also thanked the U.S. Small Business Administration’s Office of Inspector General, Eastern Region, under the direction of Special Agent in Charge Kevin Kupperbusch, and the Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP), under the direction of Special Inspector General Christy Romero, for their assistance.

The government is represented by Assistant U.S. Attorney Jacob T. Elberg, Chief of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark.

Defense counsel: Steven D. Altman Esq., New Brunswick, New Jersey

CAMDEN, N.J. – The former general counsel of VO Financial Corp. was sentenced today to 12 months in prison for conspiring to obstruct justice in a federal criminal case tried in 2013, Acting U.S. Attorney William E. Fitzpatrick announced.

Joshua L. Gayl, 37, of Lafayette Hill, Pennsylvania, previously pleaded guilty before U.S. District Judge Noel L. Hillman to an information charging him with one count of conspiracy to obstruct justice. Judge Hillman imposed the sentence today in Camden federal court.

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

Adam and Ashley Lacerda, Ian Resnick, and several others were charged in April 2012 with conspiracy to commit mail and wire fraud based on their actions at the Vacation Ownership Group, which offered phony consulting services to owners of timeshares. After they were charged, the VO Group became VO Financial, and Gayl was hired as general counsel. The Lacerdas continued to run VO Financial through their July 2013 criminal trial.

Gayl admitted misleading a witness, identified as “Victim 1,” after he learned that Victim 1 had told the FBI about being defrauded by the VO Group.

Gayl contacted Victim 1 intending to obtain statements favoring the defense in the criminal case, but he concealed his true intentions from Victim 1. Instead, he wrote Victim 1 offering assistance if Victim 1 would tell him what Victim 1 told the FBI. Gayl and an accomplice then called Victim 1 and misleadingly said that they were recording the call for quality assurance and training purposes, when in fact they were trying to get Victim 1 on tape making statements favorable to the defense. Victim 1 told Gayl that the VO Group had promised to sell Victim 1’s timeshare, a VO Group misrepresentation alleged in the indictment. Gayl omitted this allegation when he told Victim 1 what was alleged in the criminal case. Although he did not know what the VO Group representative actually told Victim 1, Gayl told Victim 1 that “we do not sell timeshares” and that Victim 1 had some “confusion” in recalling a promise to sell Victim 1’s timeshare.

Gayl ended the call and consulted with Adam Lacerda. Gayl then called Victim 1 back at Lacerda’s request to persuade Victim 1 that Victim 1’s recollection was mistaken – but Gayl did not tell Victim 1 that his purpose was to get recorded statements to help the criminal defense. Gayl told Victim 1 in the second call that it was “likely” and “logical” that Victim 1 had misunderstood that the VO Group sold timeshares.

Gayl also helped the defendants send potential trial witnesses payments intended to influence their testimony. Adam and Ashley Lacerda wanted these refunds paid to help the defense case at trial and make the recipients testify more favorably to the defense, but Gayl did not tell the potential witnesses that these were the purposes of the payments. Gayl wrote a letter urging “Victim 2” to take a refund, knowing that Resnick wanted Victim 2 to take the refund because Victim 2 was a potential trial witness against Resnick. A month before trial, Gayl wrote letters offering refunds to “Victim 3” and “Victim 4,” but failed to tell them that they were being offered refunds because they were potential trial witnesses.

Gayl also lied in responding to a trial subpoena asking VO Financial to produce records. After Adam Lacerda’s criminal lawyer told the U.S. Attorney’s Office and Gayl that he had advised Lacerda not to be involved in the subpoena response, Gayl told Adam Lacerda about one subpoenaed recording harmful to the defense and saw Lacerda access the recording. Lacerda deleted the damaging portion of the recording. When Gayl gave the U.S. Attorney VO Financial’s response to the subpoena, he included the altered recording and a false certification that he did not consult with Lacerda about the subpoena response. Gayl subsequently listened to the recording and realized that Lacerda had altered it.

In addition to the prison sentence, Judge Hillman sentenced Gayl to three years of supervised release and ordered him to pay a $5,000 fine.

Adam Lacerda, Ashley Lacerda, and Ian Resnick were convicted of conspiracy to commit mail and wire fraud and other offenses. Adam Lacerda was sentenced in June 2015 to 27 years in prison. Ian Resnick was sentenced to 18 years in prison in April 2016. Ashley Lacerda was sentenced to six years in prison in June 2016.

Acting U.S. Attorney Fitzpatrick credited agents of the FBI’s Atlantic City Resident Agency, under the direction of Special Agent in Charge Timothy Gallagher in Newark; and special agents from the Department of Labor, Office of Inspector General, Office of Labor Racketeering and Fraud Investigation, New York Region, under the direction of Special Agent in Charge Michael C. Mikulka, with the investigation.

The government is represented by Assistant U.S. Attorney R. David Walk Jr. of the U.S. Attorney’s Office in Camden.

Defense counsel: Ellen C. Brotman, Esq., Philadelphia