District of New Jersey

NEWARK, N.J. – A native of Romania who was arrested in Spain and extradited to the United States was sentenced today to 57 months in prison for his role in a conspiracy to steal bank account information from thousands of customers by installing secret card-reading devices and pinhole cameras on ATMs throughout New Jersey, New York, Connecticut, Florida, and elsewhere, U.S. Attorney Paul J. Fishman announced. 

Alin Carabus, 43, previously pleaded guilty before U.S. District Judge William J. Martini to Count One of an indictment charging him with conspiracy to commit bank fraud. Judge Martini imposed the sentence today in Newark federal court.

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

Carabus admitted he was part of a vast “ATM skimming” scheme that stole bank account information by installing secret card-reading devices on ATMs throughout New Jersey, New York, Connecticut, Florida, and elsewhere. The scheme, which ultimately defrauded Citibank, TD Bank, Wells Fargo, and multiple other financial institutions out of at least $5 million and impacted thousands of customers, was organized by Marius Vintila, 34, also a native of Romania.

Vintila and Bogdan Radu, 34, designed and constructed sophisticated card-reader devices and pinhole camera panels capable of reading and storing customers’ bank account information and personal identification numbers. Carabus and others then secretly installed devices onto bank ATMs and removed them a few days later after they had recorded customer bank account information as customers performed routine bank transactions at ATMs.

The stolen data was used to create thousands of fraudulent ATM cards, which Carabus and others used to withdraw millions of dollars from customers’ bank accounts.   

In addition to the prison term, Judge Martini also sentenced Carabus to five years of supervised release and ordered to pay restitution and forfeiture of $5 million.

The ATM skimming operation in which Carabus participated is one of the largest ever uncovered by law enforcement. To date, 15 of the 16 individuals that have been charged in connection with this scheme, including Carabus, Vintila and Radu, have been convicted.

 U.S. Attorney Fishman credited special agents of the U.S. Secret Service, Newark Field Office, under the direction of Special Agent in Charge Mark McKevitt, and special agents of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), under the direction of Special Agent in Charge Terence S. Opiola in Newark, with the investigation leading to today’s sentencing.  

The government is represented by Assistant U.S. Attorneys Rahul Agarwal of the Special Prosecutions Division and David M. Eskew of the Criminal Division in Newark. 

Defense Counsel: Joseph M. Corazza Esq., Sparta, New Jersey

NEWARK, N.J. – Three people admitted today that they smuggled counterfeit electronics, including Apple iPhones, iPads and iPods, from China for sale in the United States, U.S. Attorney Paul Fishman of the District of New Jersey, Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, Special Agent in Charge Terence Opiola of Homeland Security Investigations (HSI) in Newark, and Bergen County Prosecutor Gurbir Grewal announced.

Andreina Becerra, 31, a Venezuelan national, Roberto Volpe, 34, an Italian national, and Rosario La Marca, 54, an Italian national and resident of Naples, Italy, were originally charged in an eight-count indictment returned 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.   

The three defendants pleaded guilty before U.S. District Court Judge Kevin McNulty in Newark federal court to Count One of the indictment, charging conspiracy to traffic in counterfeit goods, to smuggle goods into the United States, and to structure financial transactions, and Count Two, charging trafficking in counterfeit goods.

As part of their plea agreements, Volpe and Becerra, who are husband and wife, agreed to forfeit their interest in 10 bank accounts, three Florida condominiums, and approximately $167,000 in cash. La Marca agreed to forfeit funds in a corporate bank account which represented proceeds of the charged offenses.    

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.   
 
    The conspiracy charge to which the defendants pleaded guilty in Count One carries a maximum potential penalty of five years in prison and a maximum fine of $250,000 or twice the gain or loss associated with the offense, whichever is greatest. The charge for trafficking in counterfeit goods to which the defendants pleaded guilty carries a maximum potential penalty of 10 years in prison and a maximum fine of $2 million. Sentencing for La Marca is scheduled for June 14, 2017. Sentencing for Volpe and Becerra is scheduled for Sept. 7, 2017.

Jianhua Li, a Chinese national currently residing in California, was charged in the original indictment, but 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 Senior Counsel Sarah Chang of the Criminal Division’s Computer Crime and Intellectual Property Section.

Three individuals pleaded guilty today for their roles in a scheme to smuggle into the United States counterfeit electronic devices, including those purporting to be genuine Apple iPhones, iPads and iPods, from China for sale in the United States.

Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, U.S. Attorney Paul Fishman of the District of New Jersey, Special Agent in Charge Terence Opiola of Homeland Security Investigations (HSI) in Newark and Bergen County Prosecutor Gurbir Grewal made the announcement. 

Andreina Becerra, 31, a U.S. citizen, Roberto Volpe, 34, an Italian national, and Rosario La Marca, 54, an Italian national and resident of Naples, Italy, each pleaded guilty before U.S. District Court Judge Kevin McNulty of the District of New Jersey to one count of conspiracy to traffic in counterfeit goods and labels, to smuggle goods into the United States, and to structure financial transactions, and one count of trafficking in counterfeit goods.  Becerra and Volpe will be sentenced on Sept. 7.  La Marca will be sentenced on June 14.

According to the documents filed in this case and statements made in court, from July 2009 through February 2014, the defendants conspired to smuggle and traffic into the United States from China more than 40,000 electronic devices and accessories, including digital cameras, iPads, iPhones, and iPods, along with labels and packaging bearing counterfeit Apple and Sony trademarks.  Defendants also wired or transferred more than 100 monetary instruments and funds totaling over $1.1 million in sales proceeds from U.S. accounts into accounts in China.  

Further, the documents filed in this case and statements made in court showed that defendants shipped devices separately from the labels bearing counterfeit trademarks for later assembly to avoid detection by U.S. Customs officials.  The devices were then shipped 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 and a portion of the proceeds was then transferred to conspirators in Italy, further disguising the source of the funds.  

Jianhua Li, also known as “Jeff Li,” a Chinese national currently residing in California, was charged as a co-defendant in an indictment filed on April 17, 2015, but 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 HSI Newark Seaport Investigations Group and the Bergen County Prosecutor’s Financial Crimes Unit investigated the case with significant assistance from Europol and Italy’s Guardia di Finanza.

Senior Counsel Sarah Chang of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorneys Leslie Schwartz and Sarah Devlin of the District of New Jersey are prosecuting the case.    

NEWARK, N.J. – A Newark man today admitted his involvement in an August 2015 home invasion that left one person dead, U.S. Attorney Paul J. Fishman announced.

Jahad Lemons, a/k/a “JBird,” 26, pleaded guilty before U.S. District Judge Madeline Cox Arleo in Newark federal court to all four counts of an indictment charging him with one count of murder during a crime of violence, one count of Hobbs Act robbery conspiracy, one count of Hobbs Act robbery, and one count of using a firearm during a crime of violence.

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

On Aug. 18, 2015, Lemons, Aaron Terrell, a/k/a “Push,” 27, and Papayaw Mack, a/k/a “GY,” 25, as well as two other individuals – referred to in the indictment as “CC-1” and “CC-2” – used firearms to rob the apartment of an individual referred to in the indictment as “Victim-1” at a residential building in Newark. They targeted Victim-1 because they believed Victim-1was a heroin trafficker whose residence contained narcotics and related proceeds.

At the residential building, Lemons, Terrell, Mack, CC-1, and CC-2 allegedly surrounded Victim-1, forced him into his apartment, and then proceeded to rob at gunpoint Victim-1 – as well as Victim-2 and Victim-3 who were already inside the apartment – of cash and personal affects. During the course of the robbery, Terrell and CC-2 allegedly discharged their firearms, which killed Victim-1 and seriously wounded Victim-2.

All three men were originally charged by the Essex County Prosecutor’s Office with murder and robbery. On Aug. 26, 2015, Terrell was arrested by the Newark Police Department, while Lemons was arrested in Georgia on Oct. 26, 2015. Mack remains at large. Terrell is also facing separate federal charges in a sixth superseding indictment for his participation in a racketeering conspiracy related to the New Jersey set of the Grape Street Crips, a violent street gang operating in and around Newark.

Under the terms of today’s plea agreement, Lemons will be sentenced to between 17 years and 22 years in prison and five years of supervised release. Sentencing is scheduled for June 12, 2017.

U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation leading to the charges. He also thanked prosecutors and detectives of the Essex County Prosecutor’s Office, under the direction of Acting Prosecutor Carolyn A. Murray, and police officers and detectives of the Newark Department of Public Safety, under the direction of Director Anthony F. Ambrose, for their assistance.

The government is represented by Assistant U.S. Attorneys Osmar J. Benvenuto and Barry A. Kamar of the Criminal Division in Newark.

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

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

Defense counsel: Kathleen M. Theurer Esq., Jersey City, New Jersey

CAMDEN, N.J. – A Deptford, New Jersey, man today admitted using a fake Facebook profile to entice children to produce sexually explicit images, U.S. Attorney Paul J. Fishman announced.

Michael J. Mostovlyan, 33, pleaded guilty before U.S. District Judge Renée Marie Bumb in Camden federal court to an information charging him with one count of online enticement of a minor to engage in criminal sexual conduct.

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

Mostovlyan admitted that, between Jan. 1, 2016 and June 2, 2016, he communicated with children online in order to obtain sexually explicit images of those children. Using a fake female persona on Facebook in the name of “Amber Zee,” which he created using actual images of a girl, Mostovlyan was able to persuade the victims to send him sexually explicit photographs or videos.

The count to which Mostovlyan pleaded guilty carries a mandatory minimum term of 10 years in prison, a potential maximum term of life imprisonment, and a $250,000 fine. Mostovlyan must also register as a sex offender. Sentencing is scheduled for June 1, 2017.

U.S. Attorney Fishman credited special agents of the FBI, under the direction Special Agent in Charge Michael Harpster in Philadelphia; the Monroe Township Police Department under the direction of Chief Michael E. Lloyd; the Gloucester County Prosecutor’s Office, under the direction of Prosecutor Sean F. Dalton; and the Deptford Township Police Department, under the direction of Chief William Hanstein, with the investigation leading to today’s plea.

The government is represented by Assistant U.S. Attorney Justin C. Danilewitz of the U.S. Attorney’s Office in Camden.

Defense counsel: Jonathan Kessous, Esq.

NEWARK, N.J. – A Pennsylvania man who operated a construction company that did work at construction projects at two military bases in New Jersey today admitted paying bribes and kickbacks to get the contracts, U.S. Attorney Paul J. Fishman announced.

George Grassie, 54, of Covington Township, Pennsylvania, pleaded guilty before U.S. District Judge Susan D. Wigenton in Newark federal court to an information charging him with one count of conspiracy to defraud the United States and commit bribery and one count of providing unlawful kickbacks.

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

Grassie owned a business that did construction, excavation and landscaping and did work as a subcontractor at Picattiny Arsenal (PICA) and Joint Base McGuire-Dix Lakehurst (Ft. Dix). He admitted that from December 2010 to December 2013, he paid bribes valued at $95,000 to $150,000 to an individual employed by the U.S. Army Contracting Command in New Jersey to obtain and retain subcontracts and other favorable assistance at PICA and Fort Dix. He also admitted that he paid kickbacks valued at $40,000 to $95,000 to Shawn Fuller and James Conway, who were then project managers for a prime contractor at PICA and Fort Dix.

Conway previously pleaded guilty to wire fraud and accepting unlawful kickbacks on August 2016. Fuller previously pleaded guilty to accepting unlawful kickbacks in November 2015.
 
The conspiracy charge to which Grassie pleaded guilty carries a maximum potential penalty of five years in prison. The charge for making unlawful kickbacks to which Grassie pleaded guilty carries a maximum potential penalty of 10 years in prison. Both charges carry a maximum fine of $250,000 or twice the gross gain or loss associated with the offense, whichever is greatest. Sentencing is scheduled for May 31, 2017.

U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher; the U.S. Department of Defense, Defense Criminal Investigative Service, under the direction of Craig R.Rupert, Special Agent in Charge, DCIS Northeast Field Office; and the U.S. Army, Major Procurement Fraud Unit, Criminal Investigation Command, under the direction of Special Agent in Charge Larry Scott Moreland, with conducting the investigation leading to today’s guilty plea.  

The government is represented by Senior Litigation Counsel Leslie Faye Schwartz, of the United States Attorney’s Office’s Special Prosecutions Division and Assistant U.S. Attorney Barbara Llanes, Deputy Chief, General Crimes Unit, of the U.S. Attorney’s Office’s Criminal Division, in Newark.    

Defense counsel: Lawrence S. Lustberg Esq., Newark

CAMDEN, N.J. – A former New Jersey attorney and his father have been indicted for their respective roles in a $13 million Ponzi scheme, U.S. Attorney Paul J. Fishman announced today.

Michael W. Kwasnik, 47, of North Miami Beach, Florida, and William M. Kwasnik, 68, of Marlton, New Jersey, were indicted Feb. 16, 2017, by a federal grand jury on three counts of wire fraud, two counts of mail fraud, one count of conspiracy to commit money laundering, and seven counts of money laundering. Michael Kwasnik was also charged with eight additional counts of transacting in criminal proceeds. The defendants are both scheduled to appear Feb. 21, 2017, before U.S. Magistrate Judge Karen M. Williams in Camden federal court.

Michael Kwasnik previously owned and operated a law firm, Kwasnik, Rodio, Kanowitz and Buckley P.C. – and its successor firm, Kwasnik, Kanowitz and Associates P.C. – with offices in Cherry Hill, New Jersey, and Philadelphia, Pennsylvania. William Kwasnik owned and operated an insurance company, Abby Grant, in Lakewood and Cherry Hill, New Jersey.

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

From October 2008 to November 2011, Michael and William Kwasnik controlled a number of entities, including Liberty State Financial Holdings Corp. and its subsidiaries (Liberty State Benefits of Pennsylvania; Liberty State Benefits of Delaware; Liberty State Insurance Services; Liberty State Wealth Management; and Liberty State Credit) and Oxbridge Investors Fund; OPIS Management Fund; and Capital Management of Delaware.

The Kwasniks allegedly carried out a scheme to defraud clients of the Kwasnik law firm by diverting funds from their trust accounts to themselves and the entities they controlled. Michael Kwasnik and others induced clients to establish various types of trusts based on misrepresentations and false pretenses. Michael Kwasnik named himself as the clients’ trustee and directed clients to transfer their money, property and other assets into their trust accounts. Michael Kwasnik then transferred the money out of the clients’ trust accounts and into accounts which he and his father controlled. More than $13 million was collected from more than 40 clients over the three-year period. The Kwasniks laundered the funds through the entities they controlled and Abby Grant before ultimately using the stolen funds to pay for legal and operational expenses of the entities they controlled, the law firm, and personal expenses.

Each count of wire fraud, mail fraud and money laundering carries a maximum penalty of 20 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. Each count of transacting in criminal proceeds carries a maximum penalty of 10 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense.

U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Michael T. Harpster, Philadelphia Division, and special agents of IRS Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen, Newark Division, with the investigation leading to the indictment.

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

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

NEWARK, N.J. – The administrator of two criminal online hacking forums was sentenced today to 41 months in prison for stealing log-in and payment card data as part of an international hacking conspiracy, U.S. Attorney Paul J. Fishman announced.

Sergey Vovnenko, a/k/a “Sergey Vovnencko,” “Tomas Rimkis,” “Flycracker,” “Flyck,” “Fly,” “Centurion,” “MUXACC1,” “Stranier,” and “Darklife,” 31, most recently of Naples, Italy, previously pleaded guilty before the U.S. District Judge Esther Salas to Count One and Count Three of an indictment charging him with wire fraud conspiracy and aggravated identity theft. Judge Salas imposed the sentence today in Newark federal court.

Vovnenko was arrested on June 13, 2014, following an international investigation led by the U.S. Secret Service in coordination with Italian law enforcement. He had been detained by the Italian authorities pending the resolution of extradition proceedings, which he contested for more than 15 months.

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

From September 2010 through August 2012, Vovnenko and his conspirators operated an international criminal organization that hacked into the computers of individual users and companies located in the United States and elsewhere. They used that access to steal user names and passwords for bank accounts and other online services, as well as debit and credit card numbers and related personal identifying information.

Vovnenko admitted that, in order to steal this data, he operated a “botnet” – more than 13,000 computers infected with malicious computer software – programmed to gain unauthorized access to computers and to identify, store, and export information from hacked computers. A number of the infected computers were located in New Jersey. Vovnenko admitted using malware known as “Zeus” to steal banking information and record the keystrokes of the users of infected computers.

According to the indictment, Vovnenko was a high-level administrator of several online criminal forums and used his position to traffic in the data he stole as part of the conspiracy. These forums featured electronic bulletin boards, which members used to publicly communicate with all members and also send private messages directly to individual members.

The public and private discussions on these forums typically pertained to criminal activity, including the purchase, sale, and use of stolen log-in credentials and payment card data, as well as discussions related to cybercrime activity such as malicious computer hacking. For example, in August 2012, one of the forums offered various illicit products for sale, including access to compromised computer servers located in the United States. A price was listed for each product, and customers could click an “order” button and purchase the product using “credits” associated with their accounts.

In addition to the prison term, Judge Salas sentenced Vovnenko to three years of supervised release and ordered him to pay restitution of $83,368.

U.S. Attorney Fishman credited the special agents of the U.S. Secret Service, Criminal Investigations Division, under the direction of Director Joseph P. Clancy, and special agents from the Newark Field Office, under the direction of Special Agent in Charge Mark McKevitt, with the ongoing investigation leading to today’s sentencing.

He also thanked the Department of Justice’s Office of International Affairs in Washington and its attaché in Rome; The U.S. Embassy to Italy and the Republic of San Marino; and the Italian Ministry of Justice and Italian law enforcement officials for their extraordinary support.

The government is represented by Assistant U.S. Attorney Daniel Shapiro of the Computer Hacking and Intellectual Property Section of the U.S. Attorney’s Office Economic Crimes Unit.

Defense Counsel: Timothy Anderson Esq., Red Bank, New Jersey

NEWARK, N.J. – A Monmouth County doctor, his oncology practice, and his wife, who managed the practice, have agreed to pay the United States $1.7 million to resolve allegations that they illegally imported and used unapproved chemotherapy drugs from foreign distributors and illegally billed Medicare, U.S. Attorney Paul J. Fishman announced today.

“Illegally imported drugs avoid the FDA’s rigorous oversight and manufacturing standards,” U.S. Attorney Fishman said. “Health care providers who import those drugs are exposing their patients to serious risks of harm from contaminated or counterfeit products.”

“Patients receiving cancer treatment drugs should be assured that the medications meet FDA’s standards for safety and quality,” Jeffrey J. Ebersole, special agent in charge, FDA Office of Criminal Investigations’ New York Field Office, said. “OCI will continue its vigilance over the prescription drug supply chain to ensure that the drugs reaching patients comply with federal law, and that those who attempt to circumvent the agency’s oversight will be brought to justice.”

The settlement announced today resolves allegations that The Oncology Practice of Dr. Kenneth D. Nahum, Nahum himself, and his wife, Ann Walsh, of Colts Neck, New Jersey, ordered cancer drugs from a foreign distributor. From April 1, 2010, until January 31, 2011, Walsh allegedly ordered chemotherapy drugs from the foreign distributor for use at the practice, which was owned by Nahum and operated in Howell, New Jersey, and Wall, New Jersey. These drugs had not been approved by FDA for sale in the United States.

Doctors at the practice allegedly injected the drugs into their patients, and the practice then submitted claims to Medicare for reimbursement for the drugs and infusion services. Since Medicare will only reimburse for drugs that have been approved for use in the United States, the practice allegedly violated the federal False Claims Act.

U.S. Attorney Fishman credited special agents of the FDA’s Office of Criminal Investigation, under the direction of Special Agent in Charge Ebersole, 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 leading to today’s settlement.

The government is represented by Assistant U.S. Attorneys Sarah Wolfe of the U.S. Attorney’s Office in Trenton, and Andrew A. Caffrey III and Charles Graybow of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark.

U.S. Attorney Paul J. Fishman reorganized the health care fraud practice shortly after taking office, including creating a stand-alone Health Care and Government Fraud Unit to handle both criminal and civil investigations and prosecutions of health care fraud offenses. Since 2010, the office has recovered more than $1.32 billion in health care fraud and government fraud settlements, judgments, fines, restitution and forfeiture under the False Claims Act, the Food, Drug, and Cosmetic Act and other statutes.

The claims settled by this agreement are allegations only, and there has been no determination of liability.

Defense counsel:

The Oncology Practice and Nahum: Michael B. Himmel Esq. and Matthew M. Oliver Esq., Roseland, New Jersey

Walsh: Salvatore T. Alfano Esq., Bloomfield, New Jersey

NEWARK, N.J. – A plastic surgeon with a practice in Basking Ridge, New Jersey, was sentenced today to 36 months in prison for fraudulently diverting millions in corporate earnings for his personal use, costing the United States nearly $3 million in tax revenue between 2006 and 2010, U.S Attorney Paul Fishman announced.

David Evdokimow, 56, of Harding Township, New Jersey, was previously convicted of all eight counts of a superseding indictment charging him with one count of conspiring to defraud the United States, four counts of personal income tax evasion and three counts of corporate tax evasion. He was convicted following three-week trial before U.S. District Judge Noel L. Hillman, who imposed the sentence today in Camden federal court.

According to the superseding indictment and evidence at trial:

Evdokimow ran his medical practice through a corporation called De’Omilia Plastic Surgery P.C. (De’Omilia). He conspired with others to conceal millions of dollars of taxable income from the IRS by forming shell corporations and then having trusted associates open bank accounts for those corporations. Evdokimow then convinced these associates to give him their signatures or signature stamps so that he had full access to the shell company bank accounts while at the same time being able to conceal his connection to those accounts. He and the other conspirators then funneled millions of dollars in De’Omilia income into the bank accounts of the shell corporations and falsely claimed that these transfers were legitimate business expenses. Evdokimow also used bank accounts in the name of De’Omilia to pay his personal expenses, and falsely claimed those were business expenses too.

Evdokimow used the shell corporation and De’Omilia bank accounts to pay for more than $5.8 million in personal expenses, including designer apparel, jewelry, vacations, artwork, and multiple residences, all of which he falsely claimed as business expenses.

Evdokimow also opened accounts at several banks in order to cash checks received directly from patients for professional medical services. Between 2009 and 2011, Evdokimow cashed more than $360,000 in checks from patients, which he failed to report on his federal income tax returns.

Evdokimow was convicted of concealing more than $5.8 million in income from tax years 2006 to 2010. By concealing this income, Evdokimow evaded paying almost $3 million in taxes during that period.

In addition to the prison term, Judge Hillman sentenced Evdokimow to one year of supervised release and fined $96,000. He previously paid the taxes owed.

U.S. Attorney Fishman credited 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 Murphy and Justin Herring of the U.S. Attorney’s Office Criminal Division in Newark.

Defense counsel: James Kridel Esq., Clifton, New Jersey

NEWARK, N.J. - An airline passenger today admitted assaulting a female passenger who did not know him aboard a flight from Los Angeles International Airport to Newark Liberty International Airport on July 30, 2016, U.S. Attorney Paul J. Fishman announced.

Veerabhadrarao Kunam, 58, of Visakhapatnam, India, pleaded guilty before U.S. Magistrate Judge Joseph A. Dickson in Newark federal court to an information charging him with assault in the special aircraft jurisdiction of the United States.

According to documents filed in this case and statements made in court, Kunam was seated next to a woman who occupied a middle seat on a Virgin America redeye flight from Los Angeles to Newark on July 29 and 30, 2016. While the plane was in the air, the woman fell asleep. Kunam admitted that while the victim was asleep, he touched her vagina and buttocks without her consent.

Kunam was arrested on July 30, 2016 – the day his flight arrived in Newark – and was taken into federal custody by the FBI.

The federal government has exclusive jurisdiction over all sexual abuse cases that occur on aircraft in flight in the United States.

Under the terms of today’s plea agreement, Kunam will be sentenced to between 30 and 60 days in prison and up to 90 days in an inpatient alcohol treatment center. Sentencing is scheduled for March 22, 2017.

U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher, and the Port Authority Police Department, under the direction of Superintendent Michael A. Fedorko, with the investigation.

The government is represented by Francisco J. Navarro of the U.S. Attorney’s Office Criminal Division in Newark.

Defense counsel: Alexander Spiro, New York, New York

A Florida man was sentenced for his role in a computer hacking and identity theft scheme that hijacked customer email accounts to send bulk unsolicited or “spam” emails and generated more than $1.3 million in illegal profits, announced Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division and U.S. Attorney Paul J. Fishman of the District of New Jersey.

Timothy Livingston, 31, of Boca Raton, Florida, was sentenced Tuesday to serve 48 months in prison before U.S. District Judge William J. Martini of the District of New Jersey.  Livingston previously pleaded guilty to one count each of conspiracy to commit fraud in connection with computers and access devices, conspiracy to commit fraud in connection with electronic mail and aggravated identity theft.  

According to admissions made in connection with his plea agreement, beginning as early as 2011, Livingston operated A Whole Lot of Nothing LLC – a business that specialized in sending spam emails on behalf of its clients.  Livingston’s clients included legitimate businesses, such as insurance companies that wished to send bulk emails to advertise their businesses, as well as illegal entities, such as online pharmacies that sold narcotics without prescriptions.

As part of his plea, Livingston admitted that beginning in January 2012, he solicited Tomasz Chmielarz to write computer programs that would send spam in a manner that concealed the true origin of the email and bypassed filters.  Livingston also used proxy servers and botnets to remain anonymous and evade spam blocking techniques.  Livingston further admitted that he hacked into individual email accounts and utilized corporate mail servers to further his spam campaigns, which enabled him to send out massive amounts of spam without identifying himself as the sender.

The FBI’s Cyber Division investigated the case.  Senior Trial Attorney William Hall Jr. of the Computer Crime and Intellectual Property Section, Assistant U.S. Attorney Daniel Shapiro of the District of New Jersey’s Computer Hacking and Intellectual Property Section of the Economic Crimes Unit, and Assistant U.S. Attorney Sarah Devlin of the Asset Forfeiture-Money Laundering Unit prosecuted the case.

NEWARK, N.J. – A Boca Raton, Florida man was sentenced to 48 months in prison for his role in a computer hacking and identity theft scheme that hijacked customer email accounts to send bulk unsolicited or “spam” emails and generated more than $1.3 million in illegal profits, New Jersey U.S. Attorney Paul J. Fishman and Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division announced today.

Timothy Livingston, 31, previously pleaded guilty before U.S. District Judge William J. Martini to one count each of conspiracy to commit fraud in connection with computers and access devices, conspiracy to commit fraud in connection with electronic mail, and aggravated identity theft. Judge Martini imposed the sentence Feb. 14, 2017 in Newark federal court.

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

Beginning as early as 2011, Livingston operated A Whole Lot of Nothing LLC – a business that specialized in sending spam emails on behalf of its clients. Livingston’s clients included legitimate businesses, such as insurance companies that wished to send bulk emails to advertise their businesses, as well as illegal entities, such as online pharmacies that sold narcotics without prescriptions.

Beginning in January 2012, Livingston solicited Tomasz Chmielarz, 34, of Rutherford, New Jersey, to write computer programs that would send spam in a manner that concealed the true origin of the email and bypassed filters. Livingston also used proxy servers and botnets to remain anonymous and evade spam blocking techniques.

Livingston hacked into individual email accounts and utilized corporate mail servers to further his spam campaigns. For instance, Livingston and Chmielarz created custom software designed to hack into the customer email accounts of a company identified in the indictment as “Corporate Victim 1” so that those accounts could then be used to send out spam. By using proxy servers and Corporate Victim 1’s customer accounts, Livingston was able to send out massive amounts of spam without identifying himself as the sender.

Livingston and Chmielarz also created custom software that appropriated a corporate website, identified in the indictment as “Corporate Victim 2,” which allowed Livingston to use Corporate Victim 2’s servers to send spam that appeared to be from Corporate Victim 2, but in reality was transmitted by Livingston.

In addition to the prison term, Judge Martini sentenced Livingston to three years of supervised release.

U.S. Attorney Fishman and Acting Assistant Attorney General Blanco credited special agents of the FBI’s Cyber Division, 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 Computer Hacking and Intellectual Property Section of the Economic Crimes Unit in Newark, Senior Trial Attorney William Hall of the Department of Justice’s Criminal Division Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Sarah Devlin of the Asset Forfeiture-Money Laundering Unit in Newark.

Defense counsel: Lorraine Gauli-Rufo Esq., Verona, New Jersey

NEWARK, N.J. – A former Amtrak supervisor today admitted fraudulently overbilling Amtrak overtime and regular hours that he claimed to be working when he was actually not present at Amtrak work sites, U.S. Attorney Paul J. Fishman announced.

Richard Vogel, 64, of Edison, New Jersey, pleaded guilty before U.S. Magistrate Judge Joseph A. Dickson in Newark federal court to an information charging him with converting to his own use federal government funds.

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

Vogel, who had been employed by Amtrak since January 1977 until he retired in July 2016, supervised approximately 35 employees in work gangs on the Construction Signals side of the Communications and Signals Department, New York Division. Between November 2015 and June 2016, Vogel fraudulently billed Amtrak for 41 regular hours and 685.75 overtime hours when he was not actually present at Amtrak work sites, resulting in a loss to Amtrak of more than $71,000.

The count to which Vogel pleaded guilty carries a maximum potential penalty of one year in prison and fines of up to $250,000, or twice the gain or loss resulting from the offense, whichever is greater. Sentencing is scheduled for May 22, 2017. The plea agreement requires Vogel to make full restitution for losses related to his conduct in the amount of $71,946.

U.S. Attorney Fishman credited Amtrak’s Office of Inspector General, Office of Investigations, Philadelphia office, with the investigation leading to today’s guilty plea.

The government is represented by Assistant U.S. Attorney Mala Ahuja Harker of the U.S. Attorney’s Office Special Prosecutions Division.

NEWARK, N.J. - A Nevada man was sentenced today to 78 months in prison for defrauding investors out of more than $5 million, U.S. Attorney Paul J. Fishman announced.

Lee Vaccaro, 45, of Las Vegas, Nevada, previously pleaded guilty before U.S. District Judge William J. Martini to an information charging him with one count of conspiracy to commit securities fraud and one substantive count of securities fraud. Judge Martini imposed the sentence today in Newark federal court.

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

Vaccaro was the chief marketing officer and vice president of investor relations for eAgency, a California-based company developing mobile security products. Vaccaro admitted that he and an individual identified as “Conspirator #1” sold investors interests in companies they controlled, and falsely represented to investors that the companies held warrants in eAgency. Warrants are derivative securities that give the holder the right to purchase common stock at a specific price within a certain time frame.

Vaccaro also admitted that he and Conspirator #1 made oral and written misrepresentations concerning the existence, number, validity, and term of eAgency warrants purportedly owned by the investment companies, as well as about the amount of money Conspirator #1 had personally invested in and raised for eAgency, and Conspirator #1’s current position at eAgency.

In addition, Vaccaro admitted that he and Conspirator #1 created and showed to investors numerous forged documents purporting to reflect the issuance of warrants to entities controlled by Vaccaro, and the transfer of those warrants to a company controlled by Conspirator #1. He admitted that most of the eAgency warrants purportedly transferred by Vaccaro to Conspirator #1’s company had, in fact, never been issued.

Beginning in January 2011, the dollar amount of interests Vaccaro and Conspirator #1 sold in the investment companies began to surpass the dollar amount of valid warrants held by the investment companies. Neither Vaccaro nor Conspirator #1 disclosed to investors the risk that their investments would be diluted by the sale of additional interests in the companies.

Vaccaro and Conspirator #1’s actions defrauded investors of more than $5 million.

In addition to the prison term, Judge Martini ordered Vaccaro to serve three years of supervised release.

U.S. Attorney Fishman 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. Securities and Exchange Commission’s New York Regional Office, under the direction of Sanjay Wadhwa and the New Jersey Bureau of Securities, under the direction of Acting Chief Amy G. Kopleton, for their assistance.

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

If you believe you are a victim of or otherwise have information concerning this alleged scheme, you are encouraged to contact the FBI at 973-792-3000.

Today’s sentencing is due to efforts by the Financial Fraud Enforcement Task Force, which 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: Robert C. Scrivo, Esq., Newark

NEWARK, N.J. – A Carteret, New Jersey, man was sentenced today to 96 months in prison for conspiring to traffic approximately four kilograms of ethylone from China to New Jersey, U.S. Attorney Paul J. Fishman announced.

Thomas Seymore, 38, previously pleaded guilty before U.S. District Court Judge Katharine S. Hayden to an indictment charging him with one count of conspiring to distribute ethylone, a Schedule I controlled substance. Judge Hayden imposed the sentence today in Newark federal court.

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

On June 10, 2014, Seymore conspired with Michael Correa, 33, of Rahway, New Jersey, to distribute approximately four kilograms of ethylone, which had been ordered from China and shipped to a location in Teaneck, New Jersey. Ethylone, sometimes referred to as “bath salts” and “molly,” is an illegal synthetic drug that stimulates the central nervous system and can cause hallucinogenic effects.

In addition to the prison term, Judge Hayden sentenced Seymore to three years of supervised release. Correa previously pleaded guilty to his role and was sentenced Dec. 20, 2016 to 57 months in prison.

U.S. Attorney Fishman credited special agents and task force officers of the Drug Enforcement Administration (DEA), under the direction of Special Agent in Charge Carl J. Kotowski; the U.S. Department of Homeland Security-Homeland Security Investigations under the direction of Special Agent in Charge Terence S. Opiola, and the U.S. Postal Inspection Service under the direction of Inspector in Charge James V. Buthorn.

The government is represented by Assistant U.S. Attorneys Jonathan M. Peck and Tazneen Shahabuddin of the U.S. Attorney’s Office Criminal Division in Newark.

Defense Counsel: Susan C. Cassell Esq., Ridgewood, New Jersey

NEWARK, N.J. – A human resources manager for two information technology companies today admitted that she obstructed a federal investigation as part of a scheme to fraudulently obtain foreign worker visas, U.S. Attorney Paul J. Fishman announced.     

Hiral Patel, 34, of Jersey City, New Jersey, pleaded guilty before U.S. District Judge Kevin McNulty in Newark federal court to an information charging her with conspiracy to obstruct justice.

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

SCM Data Inc. and MMC Systems Inc. offered consultants to clients in need of IT support. Both companies recruited foreign nationals, often student visa holders or recent college graduates, and sponsored them for H-1B visas. The H-1B program allows businesses in the United States to temporarily employ foreign workers with specialized or technical expertise in a particular field, such as accounting, engineering or computer science. 

Patel’s conspirators recruited foreign workers with purported IT expertise who sought work in the United States. The conspirators then sponsored the foreign workers’ H-1B visas with the stated purpose of working for SCM Data and MMC Systems’ clients throughout the United States. When submitting the visa paperwork to the U.S. Department of Homeland Security, U.S. Citizenship and Immigrations Services (USCIS), the conspirators represented that the foreign workers had full-time positions and were paid an annual salary, as required to secure the visas.

Contrary to these representations and in violation of the H-1B program, the conspirators paid the foreign workers only when they were placed at a third-party client who entered into a contract with SCM Data or MMC Systems. The conspirators told the foreign workers who were not currently working that if they wanted to maintain their H-1B visa status, they would need to come up with what their gross wages would be in cash and give it to SCM Data and MMC Systems so the companies could issue payroll checks to the foreign workers. 

The conspirators then encouraged the foreign workers to submit the bogus payroll checks to USCIS as proof that the workers were engaged in full-time work despite the fact that they were not working for the companies. Once the U.S. Department of Labor (USDOL) launched an audit of SCM Data and MMC Systems, the conspirators fabricated leave or vacation slips to USDOL for the time periods that the foreign workers were not working to conceal the fact that they were not paid during those time periods as required by federal law.

Patel – who was a human resources manager for SCM Data and MMC Systems – admitted that in February 2015 and March 2015, in response to a USDOL audit, she was involved in preparing false leave slips for the foreign workers on behalf of SCM Data and MMC Systems.

Patel faces a maximum potential penalty of five years in prison and a $250,000 fine.  Sentencing is scheduled for June 1, 2017.   

U.S. Attorney Fishman praised special agents of the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), under the direction of Special Agent in Charge Terence Opiola, and the U.S. Department of Labor, Office of Inspector General, under the direction of Special Agent in Charge Michael Mikulka, with the investigation.
    
The government is represented by Assistant U.S. Attorney Joyce M. Malliet of the U.S. Attorney’s Office’s National Security Unit in Newark.

Defense Counsel:  Michael V. Gilberti, Esq.

NEWARK, N.J. – A crack-cocaine wholesaler for the New Jersey set of the Grape Street Crips today admitted his involvement in racketeering and drug trafficking conspiracies operating in Newark, New Jersey, U.S. Attorney Paul J. Fishman announced.

James S. Gutierrez, a/k/a “Bad News,” 26, of Newark, pleaded guilty before U.S. District Judge Madeline Cox Arleo in Newark federal court to Count 1 and Count 18 of a sixth superseding indictment charging him with racketeering conspiracy and conspiracy to distribute crack-cocaine.

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

The New Jersey Grape Street Crips controlled drug trafficking and other criminal activities in various areas of Newark. Gutierrez and other members of the gang accepted orders for, and distributed, thousands of clips of crack-cocaine to other distributors, including other gang members.

To protect their gang and drug territory, the New Jersey Grape Street Crips operating in the area of 6th Avenue and North 5th Street in Newark used “community guns” that were easily accessible to gang members. During the course of the investigation, law enforcement agents seized numerous firearms, including a .410 caliber assault rifle, a.45 caliber Thompson semi-automatic carbine, a 7.62 caliber assault rifle, and numerous semi-automatic handguns.

Under the terms of today’s plea agreement, Gutierrez will be sentenced to between 10 years and 14 years in prison and five years of supervised release. Sentencing is scheduled for May 22, 2017.

U.S. Attorney Fishman credited special agents of the DEA, under the direction of Special Agent in Charge Carl J. Kotowski in Newark, and special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation. He also thanked prosecutors and detectives of the Essex County Prosecutor’s Office, under the direction of Acting Prosecutor Carolyn A. Murray; police officers and detectives of the Newark Department of Public Safety, under the direction of Director Anthony F. Ambrose; and the Essex County Sheriff’s Office under the direction of Armando B. Fontoura, for their assistance in this case.

The government is represented by Assistant U.S. Attorneys Osmar J. Benvenuto and Barry A. Kamar of the Criminal Division in Newark.

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

Defense counsel: Edward J. Plaza Esq., Little Silver, New Jersey

TRENTON, N.J. – A former resident of Old Tappan, New Jersey, today admitted evading personal income taxes on more than $400,000 in income in 2013, U.S. Attorney Paul J. Fishman announced.

William Dominick, 68, of Collier County, Florida, pleaded guilty before U.S. District Judge Anne E. Thompson in Trenton federal court to an information charging him with one count of tax evasion and one count of identity theft.

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

Dominick owned and operated Westwood Rare Coin out of his home in Old Tappan. He was required to include income earned by Westwood Rare Coin on his individual IRS 1040 form. During calendar year 2013, Dominick failed to report $400,000 in income earned by Westwood Rare Coin. He did this by using other people’s identities to open credit cards to purchase bulk quantities coins from the U.S. Mint in order to corner the market. Dominick then sold those coins through his business, retained the proceeds for his personal use, and failed to include the proceeds on the tax return that he signed and filed with the IRS.

The count of identity theft to which Dominick pleaded guilty carries a maximum potential penalty of 15 years in prison; the count of tax evasion carries a maximum potential penalty of five years in prison; both counts also carry a fine of up to $250,000. Sentencing is scheduled for May 23, 2017.

Under terms of his plea agreement, Dominick will file amended returns and make full restitution for years 2010 through 2014.

U.S. Attorney Fishman credited special agents of the FBI, under the direction of special agent in charge Timothy Gallagher; special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen; and inspectors of the U.S. Postal Inspection Service, under the direction of Postal Inspector in Charge James V. Buthorn, with the investigation leading to today’s guilty plea.

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

Defense counsel: John Whipple Esq., Morristown, New Jersey

CAMDEN, N.J. – Two Camden-area men were charged by a federal grand jury today in connection with their roles in a drug distribution organization, U.S. Attorney Paul J. Fishman announced.

Preston J. Thomas, 30, a/k/a “Boo,” of Camden, was charged in a superseding indictment with one count of conspiracy to distribute and to possess with intent to distribute cocaine base and one count of possession of a firearm in furtherance of a drug trafficking crime. The superseding indictment also charged Jeffrey Whitaker, 33, a/k/a “Jay,” a/k/a “Jay Black,” and a/k/a “Black,” of Collingswood, with the same drug trafficking conspiracy offense.

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

Thomas, Whitaker and others were originally charged by complaint on Sept. 9, 2016, following a long-term investigation by the FBI’s South Jersey Violent Offender and Gang Task Force. Law enforcement officers seized drugs and recovered two handguns that were kept by members of the conspiracy in connection with the organization’s drug trafficking activities. Investigators also intercepted communications pursuant to court-authorized wiretaps on cellular telephones used by several members of the conspiracy.

Two conspirators identified in the indictment have already pleaded guilty to drug conspiracy and firearm offenses.

On Jan. 17, 2017, Jason Boyd, 36, a/k/a “Teddy,” a/k/a “Teddy Reek,” and a/k/a “Fatboy,” pleaded guilty before U.S. District Judge Jerome B. Simandle in Camden federal court to an information charging him with one count of conspiracy to distribute and to possess with intent to distribute cocaine base and one count of possession of a firearm in furtherance of a drug trafficking crime. Boyd’s sentencing is scheduled for April 28, 2017.

On Dec. 8, 2016, Derek Stallworth, 20, a/k/a “AK” and a/k/a “A,” of Camden, also pleaded guilty before Judge Simandle to the same charges. His sentencing is scheduled for March 24, 2017.

The drug distribution conspiracy charge carries a maximum potential penalty of 20 years in prison and a $1 million fine. The firearms charge carries a mandatory minimum sentence of five years in prison to be served consecutively to the sentence for the conspiracy charge.

U.S. Attorney Fishman credited special agents of the FBI’s South Jersey Violent Offender and Gang Task Force, South Jersey Resident Agency, under the direction of Special Agent in Charge Michael Harpster; the Camden County Police Department, under the direction of Chief J. Scott Thomson; the Camden County Prosecutor’s Office, under the direction of Prosecutor Mary Eva Colalillo; and the N.J. State Police, under the direction of Col. Rick Fuentes, with the investigation leading to today’s indictment.

He also thanked the Camden County Sheriff’s Department, the Cherry Hill Police Department, and the U.S. Department of Homeland Security Investigations (HSI) for their assistance.

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

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

Defense counsel:

Thomas: Maggie Moy Esq., Assistant Federal Public Defender, Camden

Whitaker: Mark Catanzaro Esq., Mt. Holly, New Jersey

CAMDEN, N.J. – A Willingboro, New Jersey, man was sentenced today to 96 months in prison for his role in a conspiracy to rob a drug stash house of multiple kilograms of cocaine that he believed would be stored at the location, U.S. Attorney Paul J. Fishman announced.

Sean Forman, a/k/a “C-Life,” 43, previously pleaded guilty before U.S. District Judge Noel L. Hillman to a two-count superseding information charging him with conspiracy to commit robbery and conspiracy to distribute cocaine. Judge Hillman imposed the sentence today in Camden federal court.

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

In January 2014, Forman, Robert Smith, 43, of Trenton, Derrick Adams, 30, of Florence and Willingboro, New Jersey, and Daquon Basnight, 25, Jamiil McFarlane, 24, and Morris Muse, 36, all of Trenton, planned a gunpoint robbery of a drug stash house in order to steal kilograms of cocaine from dealers at the location. During an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Smith was recorded – in the presence of Forman – discussing his willingness, if necessary, to kill the occupants of the stash house. Smith and Adams, in text message conversations and recorded communications, discussed their plan to rob the stash house while posing as law enforcement.

ATF special agents arrested the conspirators when they arrived at a meeting location in Maple Shade, New Jersey, on Jan. 30, 2014. After searching the conspirators and their vehicles, the agents recovered five firearms – including a sawed-off shotgun and two stolen handguns – as well as numerous rounds of ammunition, a ballistics vest, masks, gloves, and zip ties.

In addition to the prison terms, Judge Hillman ordered Forman to serve five years of supervised release.

Basnight, McFarlane, Muse, and Adams all previously pleaded guilty to their roles and have been sentenced to prison. Smith was convicted at trial and sentenced to 360 months in prison in November 2016.

U.S. Attorney Fishman credited special agents with the ATF Camden Field Office, under the direction of Acting Special Agent in Charge Scott C. Curley in Newark, with the investigation leading to today’s sentence. He also thanked the Drug Enforcement Administration (DEA) Maple Shade Field Office, as well as the Burlington City and Burlington Township police departments, for their assistance in this case.

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

Defense counsel: Brian O’Malley Esq.

ALBUQUERQUE – During a hearing yesterday, a U.S. Magistrate Judge sitting in Albuquerque, N.M., found probable cause to support a criminal complaint charging Michael Gerard Smith, 55, of Albuquerque, with violating the federal narcotics and firearms laws. Today, the Magistrate Judge entered an order holding Smith in federal custody pending trial based on judicial findings that he poses a risk of flight and danger to the community. The federal charges against Smith were announced by U.S. Attorney Damon P. Martinez, Special Agent in Charge Will R. Glaspy of DEA’s El Paso Division, and Chief Gorden G. Eden, Jr., of the Albuquerque Police Department (APD).

Smith, whose criminal history includes 11 prior felony convictions for drug trafficking, robbery, false imprisonment and forgery offenses, is being prosecuted under the federal anti-violence initiative that targets “the worst of the worst” offenders for federal prosecution. Under this initiative, the U.S. Attorney’s Office and federal law enforcement agencies work with New Mexico’s District Attorneys and state, local and tribal law enforcement agencies to target violent or repeat offenders primarily based on their prior criminal convictions for federal prosecution with the goal of removing repeat offenders from communities in New Mexico for as long as possible. Because New Mexico’s violent crime rate, on a per capita basis, is one of the highest in the nation, New Mexico’s law enforcement community is collaborating to target repeat offenders from counties with the highest violent crime rates.

Smith was arrested on Feb. 3, 2017, and charged by criminal complaint with methamphetamine and heroin trafficking offenses, and being a felon in possession of a firearm. According to the criminal complaint, APD officers allegedly seized approximately 94.5 grams of methamphetamine, 34.9 grams of heroin, a handgun, and cash in denominations consistent with street level drug trafficking while executing a search warrant at Smith’s residence.

If convicted, Smith faces a statutory mandatory minimum penalty of ten years and a maximum of life in prison on the drug trafficking charges, and a maximum of ten years in in prison for being a felon in possession of a firearm. If deemed an armed career criminal, Smith faces an enhanced penalty of not less than 15 years in prison for unlawfully possessing a firearm, and the potential of a life sentence on the drug trafficking charges if the United States files a prior felony information.

Charges in criminal complaints are merely accusations and defendants are presumed innocent unless found guilty in a court of law.

The case against Smith was investigated by the Albuquerque office of the DEA and the APD, and is being prosecuted by Assistant U.S. Attorney Norman Cairns as part of the New Mexico Heroin and Opioid Prevention and Education (HOPE) Initiative. The HOPE Initiative was launched in January 2015 by the UNM Health Sciences Center and the U.S. Attorney’s Office in response to the national opioid epidemic, which has had a disproportionately devastating impact on New Mexico. Opioid addiction has taken a toll on public safety, public health and the economic viability of our communities. Working in partnership with the DEA, the Bernalillo County Opioid Accountability Initiative, Healing Addiction in our Community (HAC), the Albuquerque Public Schools and other community stakeholders, HOPE’s principal goals are to protect our communities from the dangers associated with heroin and opioid painkillers and reducing the number of opioid-related deaths in New Mexico.

The HOPE Initiative is comprised of five components: (1) prevention and education; (2) treatment; (3) law enforcement; (4) reentry; and (5) strategic planning. HOPE’s law enforcement component is led by the Organized Crime Section of the U.S. Attorney’s Office and the DEA in conjunction with their federal, state, local and tribal law enforcement partners. Targeting members of major heroin and opioid trafficking organizations for investigation and prosecution is a priority of the HOPE Initiative. Learn more about the New Mexico HOPE Initiative at http://www.HopeInitiativeNM.org.

TRENTON, N.J. – A Monmouth County, New Jersey, man today admitted downloading sexually explicit videos and images of children to his home computer, U.S. Attorney Paul J. Fishman announced.

James Paroline, 27, of Red Bank, New Jersey, pleaded guilty before U.S. District Judge Freda L. Wolfson in Trenton federal court to Count One of an indictment charging him with receiving child pornography.

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.

The count to which Paroline pleaded guilty carries a mandatory minimum term of five years in prison, a statutory maximum of 20 years in prison, and a $250,000 fine. Sentencing is scheduled for June 1, 2017.

U.S. Attorney Fishman 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 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.

NEWARK – A Warren County, New Jersey, tax preparer was arrested this morning and charged with allegedly filing false returns on behalf of his clients and misappropriating clients’ funds, U.S. Attorney Paul J. Fishman announced.

Brian Allen Day, 54, of Port Murray, New Jersey, was indicted by a federal grand jury on four counts of aiding and assisting in the filing of false individual income tax returns for clients and four counts of defrauding banks by misappropriating clients’ funds based on misrepresentations about their purported tax payments owed to the IRS and by altering checks they paid to him for the purported tax liabilities and depositing the checks in his business bank accounts. He will appear this afternoon before U.S. Magistrate Judge Mark Falk in Newark federal court.

According to the indictment:

Day is self-employed as a tax preparer and has various tax preparation businesses in New Jersey, such as PTS, Tax Consultants, and Tax Consultants LLC. For the tax years 2013 to 2015, Day prepared false individual income tax returns for various clients by fabricating and inflating expenses and deductions on Schedule A or supplemental loss deductions on Schedule E of their Form 1040s in order to obtain refunds in amounts greater than those to which they were entitled. The total amount of false deductions and expenses charged in the indictment is $383,773.

Additionally, from December 2011 through April 2015, Day misappropriated some of his taxpayer clients’ monies by falsely advising them that they owed certain tax payments to the IRS; directing his clients to give him checks made payable to the IRS to resolve these purported liabilities with the IRS; altering the checks made payable to the IRS to make them appear to be payable to Day’s tax preparation businesses; and then depositing the checks into his business bank accounts without making any payment to the IRS on behalf of the clients. By doing so, Day defrauded the financial institutions from which these checks were drawn. Day presented his clients with fraudulent documents purportedly issued by the IRS falsely stating that it had received payments for the purported liabilities. Day misappropriated $61,000 from his clients.

Each count of aiding and assisting in the filing of false tax returns carries a maximum potential penalty of three years in prison and a fine of $250,000 or twice the gross pecuniary gain or loss from the fraud. The bank fraud charges each carry a maximum potential penalty of 30 years in prison and a fine of $1 million.

U.S. Attorney Fishman credited special agents of the IRS-Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen; and special agents of the U.S. Treasury Inspector General for Tax Administration (TIGTA) under the direction of Rodney A. Davis, with the investigation leading to the indictment.

The government is represented by Assistant U.S. Attorney Jihee G. Suh of the General Crimes Unit in Newark.

Anyone who believes they may have been a victim of this defendant can contact IRS-Criminal Investigation at (732) 761-6439.

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

Defense Counsel: Assistant Federal Public Defender Lisa Mack Esq., Newark

NEWARK, N.J. – A Paramus, New Jersey, man was sentenced today to one year of probation for helping funnel $80,000 in campaign contributions from a foreign source to the joint fundraising committee of the President of the United States during the 2012 presidential election, U.S. Attorney Paul J. Fishman announced.

Bilal Shehu, 48, previously pleaded guilty before U.S. District Judge Madeline Cox Arleo to an information charging him with knowingly and willfully making foreign contributions and donations in connection with the 2012 presidential election and to a fundraising and political campaign committee of the president, aggregating $25,000 or more during a calendar year. Judge Arleo imposed the sentence today in Newark federal court.

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

In September 2012, Shehu, a U.S. citizen living in New Jersey, received approximately $80,000 from a foreign source and provided it to a joint fundraising committee – including the authorized campaign committee of the president – to disguise the true origin of the money and so that a foreign national could attend a campaign event on Oct. 8, 2012, in San Francisco.

Federal law prohibits foreign nationals from making contributions to federal candidates or fundraising committees and, in order to attend the event, a foreign national needed to be accompanied by a U.S. citizen.

Shehu admitted that he received the $80,000 wire transfer into his New Jersey-based bank account from a foreign bank account in late September 2012, knowing that he was to provide it to the joint fundraising committee. In early October 2012, Shehu flew to San Francisco and attempted to gain entry into the San Francisco fundraising event with the foreign national, who was denied entry but was allowed to be photographed with the President.

No one on the joint fundraising committee has been accused of any wrongdoing and the committee has fully cooperated in the investigation leading to today’s sentencing.

William Argeros, 58, of Tampa, Florida, was also charged in this scheme and pleaded guilty on July 25, 2016. His sentencing is scheduled for Feb. 14, 2017.

U.S. Attorney Fishman 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.

The government is represented by Assistant U.S. Attorney Mark J. McCarren of the District of New Jersey’s Special Prosecutions Division and Trial Attorneys Charles Walsh and Peter Halpern of the Criminal Division’s Public Integrity Section.

Defense counsel: Alan M. Abramson Esq., New York

CAMDEN, N.J. – An Atlantic County man who was previously 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 admitted today to traveling in order to launder money in connection with a similar scheme, U.S. Attorney Paul J. Fishman announced.

Patrick Giblin, 52, formerly of Ventnor, New Jersey, pleaded guilty before U.S. District Judge Robert B. Kugler in Camden federal court 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.

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’s 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.

The count to which Giblin pleaded guilty carries a maximum term of five years in prison and a fine of up to five years in prison and a fine of $250,000. He must also pay restitution to victims. As part of the plea agreement in this case, the U.S. Attorney’s Office will recommend that the Court sentence Giblin to the statutory maximum term of five years. Sentencing is scheduled for May 12, 2017.

U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation leading to the charges. Fishman 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. – Two crack-cocaine wholesalers for the New Jersey set of the Grape Street Crips gang today admitted their involvement in racketeering and drug trafficking conspiracies operating in Newark, New Jersey, U.S. Attorney Paul J. Fishman announced today.

Hakeem Vanderhall, a/k/a “Keem,” a/k/a “Sugar Bear,” 32, of East Orange, New Jersey, and Eric Concepcion, a/k/a “Eddie Arroyo,” a/k/a “E-Wax,” a/k/a “Wax,” 30, of Clifton, New Jersey, pleaded guilty before U.S. District Judge Madeline Cox Arleo in Newark federal court to Count 1 and Count 18 of a sixth superseding indictment charging them with racketeering conspiracy and conspiracy to distribute crack-cocaine.

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

The New Jersey Grape Street Crips controlled drug trafficking and other criminal activities in various areas of Newark. Vanderhall, Concepcion and other members of the gang, including Jamar Hamilton, a/k/a “Gunner,” Tyquan Clark a/k/a “Tah,” and Rashan Washington, a/k/a “Shoota,” used and shared a dedicated cell phone to accept orders for, and distribute, thousands of clips of crack-cocaine to other distributors of crack-cocaine, including other gang members.

To protect their gang and drug territory, the New Jersey Grape Street Crips operating in the area of 6th Avenue and North 5th Street in Newark used “community guns” that were easily accessible to gang members. During the course of the investigation, law enforcement agents seized numerous firearms, including a .410 caliber assault rifle, a.45 caliber Thompson semi-automatic carbine, a 7.62 caliber assault rifle, and numerous semi-automatic handguns.

Under the terms of today’s plea agreements, both Vanderhall and Concepcion will be sentenced to 18 years in prison and five years of supervised release. Sentencing for both defendants is scheduled for May 16, 2017.

U.S. Attorney Fishman credited special agents of the DEA, under the direction of Special Agent in Charge Carl J. Kotowski in Newark, and special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, for the investigation leading to the charges. He also thanked prosecutors and detectives of the Essex County Prosecutor’s Office, under the direction of Acting Prosecutor Carolyn A. Murray; police officers and detectives of the Newark Department of Public Safety, under the direction of Director Anthony F. Ambrose; and the Essex County Sheriff’s Office under the direction of Armando B. Fontoura, for their assistance in this case.

The government is represented by Assistant U.S. Attorneys Osmar J. Benvenuto and Barry A. Kamar of the Criminal Division in Newark.

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

Defense counsel:

Vanderhall: Joshua L. Markowitz Esq., Lawrenceville, New Jersey
Concepcion: Stephen Turano Esq., Newark

CAMDEN, N.J. - A Mantua, New Jersey, man today admitted overseeing a more than 15-month conspiracy to sell crack cocaine in Camden, New Jersey, U.S. Attorney Paul J. Fishman announced.

Harold Miller, 41, pleaded guilty before U.S. District Judge Joseph H. Rodriguez in Camden federal court to an information charging him with one count of conspiracy to distribute and to possess with intent to distribute cocaine base.

According to documents filed in this case and statements made in court, Miller admitted that from May 2014 through Sept. 1, 2015, he oversaw a conspiracy to distribute crack cocaine on Pfeiffer Street in Camden. Miller admitted that as part of his role, he managed the drug sales on Pfeiffer Street and coordinated the supply of crack cocaine to other dealers.

The conspiracy charge carries a maximum potential penalty of 20 years in prison. Miller’s sentencing is scheduled for May 8, 2017.

Miller was arrested on Sept. 2, 2015 following an investigation by the FBI’s South Jersey Violent Offender and Gang Task Force. Rasheed Wise, Rodney Wall, and David Wilkerson, all of Camden, previously pleaded guilty to their roles in the conspiracy and await sentencing.

U.S. Attorney Fishman credited special agents of the FBI’s South Jersey Violent Offender and Gang Task Force, South Jersey Resident Agency, under the direction of Special Agent in Charge Michael Harpster; the Camden County Police Department, under the direction of Chief J. Scott Thomson; the Camden County Prosecutor’s Office, under the direction of Prosecutor Mary Eva Colalillo; and the N.J. State Police, under the direction of Col. Rick Fuentes, with the investigation.

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

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

NEWARK, N.J. – Two men today admitted their roles in a conspiracy to illegally transport foreign nationals into the United States via commercial airline flights, U.S. Attorney Paul J. Fishman announced.

Nileshkumar Patel, 42, and Harsad Mehta, 68, both of India, pleaded guilty before U.S. District Judge William J. Martini in Newark federal court to separate superseding informations charging them each with one count of conspiracy to smuggle foreign nationals into the United States for commercial advantage and private financial gain.

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

Patel and Mehta admitted that from June 2013 through October 2015, they conspired to make money by recruiting Indian nationals to enter and reside in the United States illegally. Patel and Mehta admitted that on July 24, 2014, they brought two Indian nationals to Bangkok, Thailand, so that they could be transported into the United States. They also admitted paying an individual – who was actually an undercover officer – to transport the foreign nationals from Thailand into Newark.

The conspiracy count carries a maximum potential sentence of 10 years in prison. Sentencing is scheduled for May 16, 2017.

U.S. Attorney Fishman credited special agents of the U.S. Department of Homeland Security, Homeland Security Investigations, under the direction of Special Agent in Charge Terence S. Opiola in Newark, with the investigation.

The government is represented by Assistant U.S. Attorney Francisco J. Navarro of the U.S Attorney’s Office National Security Unit in Newark.

Defense counsel:

Patel: Michael P. Koribanics Esq., Clifton, New Jersey

Mehta: Mark A. Berman Esq., River Edge, New Jersey

NEWARK, N.J. – A Clifton, New Jersey, man was sentenced today to 216 months in prison for health care fraud, obstructing a federal audit, and other charges associated with his illegal operation of an ambulance company despite having been banned from participating in federal health care programs, U.S. Attorney Paul J. Fishman announced.

Imadeldin Awad Khair, a/k/a “Nadr Awad,” 57, was previously convicted of all 17 counts of an indictment charging him with health care fraud, obstructing a federal audit, tax evasion, and money laundering. He was convicted following a nine-day bench trial before U.S. District Judge Susan D. Wigenton, who imposed the sentence today in Newark federal court.

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

In 2004, as a result of his conviction on a New Jersey state health care fraud charge, Khair was excluded from participating in any capacity in Medicare, Medicaid, or other federal health care programs for a minimum of 11 years. After realizing that he would be excluded from federal health care programs, Khair began operating a business named K&S Invalid Coach in his brother’s name. Since the date of his exclusion, Medicare and Medicaid paid over $9 million in claims submitted by K&S, none of which would have been paid had Medicare and Medicaid known that Khair was operating the business.

Khair’s plan to defraud Medicare and Medicaid began almost immediately after he was excluded by authorities from participating in federal health care programs. In 2004 and 2005, Khair recruited a business associate to tell authorities that Khair was his full-time employee so that Khair could continue running K&S in violation of his exclusion. Khair also used fraudulent paystubs provided by his business associate to convince authorities that he was not violating the terms of his exclusion.

In 2014, when special agents with the FBI and the U.S. Department of Health and Human Services, Office of Inspector General, executed a search warrant at K&S’s offices, Khair’s top managers directed employees via group text message to tell the agents that Khair’s brother was really in charge at K&S. In addition, on the first day of trial, Khair tried to influence a government witness just outside of the courtroom by claiming that he had over two dozen employees who were going to testify that his brother had really been in charge at K&S.

Khair also paid numerous K&S employees, including nearly all of the employees’ overtime wages, “off the books” and without withholding the necessary payroll taxes. To carry out the tax evasion scheme, Khair paid the wages in cash or handwritten check and directed K&S employees to keep two separate sets of books. Khair then directed company employees to send only the fraudulent set of books to the company’s payroll accountant.

In response to a U.S. Department of Labor audit of K&S in 2014, Khair held an employee meeting in which he directed K&S employees to lie to the Department of Labor by stating that they never worked more than 80 hours in a biweekly pay period. Khair also directed K&S employees to alter and falsify K&S timekeeping records to match the false amounts previously reported to the company’s payroll accountant.

The money laundering counts arose from K&S checks that were written and endorsed by Khair and made payable to “cash” or Khair himself, which were used to pay the undisclosed wages and enrich Khair personally.

In addition to the prison term, Judge Wigenton ordered Khair to serve three years of supervised release and pay restitution of $8.8 million.

U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark; special agents of the U.S. Department of Health and Human Services, Office of Inspector General, under the direction of Special Agent in Charge Scott J. Lampert; 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 Danielle M. Corcione and Osmar J. Benvenuto of the U.S. Attorney’s Office Criminal Division in Newark.

U.S. Attorney Fishman reorganized the health care fraud practice shortly after taking office, creating a stand-alone Health Care and Government Fraud Unit to handle both criminal and civil investigations and prosecutions of health care fraud offenses. Since 2010, the office has recovered more than $1.32 billion in health care fraud 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: Harvey R. Poe Esq., Roseland, New Jersey

TRENTON, N.J. – A Bronx, New York, man was sentenced today to 48 months in prison for his role in a conspiracy to possess with intent to distribute 22 kilograms of heroin in New Jersey, U.S. Attorney Paul J. Fishman announced.

Edwin Alamo Jr., 22, previously pleaded guilty before U.S. District Judge Peter G. Sheridan to an information charging him with one count of conspiracy to possess with intent to distribute more than one kilogram of heroin. Judge Sheridan imposed the sentence today in Trenton federal court.

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

On Feb. 5, 2016, law enforcement observed a tractor-trailer, occupied by Sauro D. Estevez-Figueredo and Alberto Mora, parked at an intersection near a store in Clifton, New Jersey. That afternoon, Emmanuel Gonzalez and Alamo drove to the tractor-trailer and left with a suitcase given to them by Mora. Later, Porfirio Peralta-Nunez arrived at the tractor-trailer with two empty bags and left shortly afterwards with the bags filled.

Subsequent traffic stops allegedly revealed 22 kilograms of heroin in Gonzalez and Alamo’s possession. Additional quantities of narcotics were allegedly found in Peralta-Nunez’s possession. Law enforcement also found 10 kilograms of cocaine and 10 kilograms of fentanyl remaining at the tractor-trailer.

Alamo admitted that he went to Clifton to pick up narcotics from a tractor-trailer and that he obtained a suitcase containing approximately 22 kilograms of heroin.

In addition to the prison term, Judge Sheridan sentenced Alamo to three years of supervised release.

Co-defendants Mora and Gonzalez have pleaded guilty; Gonzalez was sentenced to 120 months in prison and Mora is awaiting sentencing. Charges and allegations pending against Peralta-Nunez and Estevez-Figueredo are merely accusations, and they are considered innocent unless and until proven guilty.

U.S. Attorney Fishman credited special agents of the Drug Enforcement Administration (DEA), under the direction of Special Agent in Charge Carl J. Kotowski in Newark, with the investigation leading to today’s sentencing.

The government is represented by Assistant U.S. Attorney Meredith Williams of the Narcotics/OCDETF unit of the U.S. Attorney’s Office in Newark.

Defense counsel: Chester Keller Esq., First Assistant Federal Public Defender

NEWARK, N.J. – Two Newark men who collectively carried out two armed carjackings and one attempted carjacking in September 2013 were each sentenced to prison today, U.S. Attorney Paul J. Fishman announced.

Dion Hines, 23, and Roosevelt Robinson, 25, were sentenced to 192 and 171 months in prison, respectively. Hines previously pleaded guilty before U.S. District Judge Katharine S. Hayden to an information charging him with one count of attempted carjacking, two counts of carjacking, and one count of using a firearm during a crime of violence. Robinson previously pleaded guilty to an information charging him with one count of attempted carjacking, one count of carjacking, and one count of using a firearm during a crime of violence. Judge Hayden imposed both sentences today in Newark federal court.

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

On Sept. 22, 2013, Hines, Robinson, and another male individual approached a Mercedes Benz sedan that was parked in a residential driveway in Newark. Hines brandished a handgun and ordered the driver to get out of the vehicle. The victim eventually got out of the car and Robinson sat in the driver’s seat. After Hines and the other male individual fled on foot, the victim fought Robinson, pulled him from the Mercedes Benz, and got back into the vehicle. Hines returned and fired two shots at the Mercedes Benz. Afterwards, Hines, Robinson, and the other male individual fled the scene.

On Sept. 26, 2013, Hines approached two individuals at a parking lot in Newark, threatened them with a handgun, and demanded the keys to their vehicles. After one of the victims gave Hines the keys to a 2009 Acura sedan, he got into the car and fled.

On the morning of Sept. 27, 2013, Hines was traveling in a dark-colored SUV driven by another individual. The SUV pulled in front of a Range Rover stopped at an intersection in Belleville, New Jersey, blocking the Range Rover’s path. Hines got out of the SUV and pointed a handgun at the driver of the Range Rover. Robinson, who followed the SUV in a separate vehicle, pulled over and stood watch. Hines pulled the driver out of the Range Rover, got into the vehicle and fled, followed by the SUV and Robinson’s vehicle.

In addition to the prison terms, Judge Hayden sentenced both Hines and Robinson to five years of supervised release.

U.S. Attorney Fishman credited special agents of the U.S. Department of Homeland Security, Homeland Security Investigations, under the direction of Special Agent in Charge Terence S. Opiola in Newark; the Essex County Prosecutor’s Office, under the direction of Acting Prosecutor Carolyn A. Murray; and the Newark, Elizabeth, and Belleville police departments with the investigation.

The government is represented by Assistant U.S. Attorney J. Jamari Buxton of the U.S. Attorney’s Office Organized Crime/Gangs in Newark.

Defense Counsel:

Hines: John Yauch Esq., Assistant Federal Public Defender, Newark

Robinson: Paul Condon Esq., Jersey City, New Jersey

TRENTON, N.J. – An Iselin, New Jersey, man was sentenced today to 46 months in prison for his role in one of the largest credit card fraud schemes ever charged by the U.S. Department of Justice, U.S. Attorney Paul J. Fishman announced.

Babar Qureshi, 63, previously pleaded guilty before U.S. District Judge Anne E. Thompson to Count One of an indictment charging him with conspiracy to commit bank fraud. Judge Thompson imposed the sentence today in Trenton federal court.

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

Qureshi was originally charged in February 2013 as part of a conspiracy to fabricate more than 7,000 false identities to obtain tens of thousands of credit cards. The scheme involved a three-step process in which the defendants would make up a false identity by creating fraudulent identification documents and a fraudulent credit profile with the major credit bureaus; pump up the credit of the false identity by providing false information about that identity’s creditworthiness to those credit bureaus; and finally, run up large loans.

The scope of the criminal fraud enterprise required Qureshi and other conspirators to construct an elaborate network of false identities. Across the country, the conspirators maintained more than 1,800 “drop addresses,” including houses, apartments and post office boxes, which they used as the mailing addresses of the false identities.

Qureshi’s role in the conspiracy was to take the phony cards and charge large amounts at complicit merchants, who would then pay him a portion of the charge. He used phony bank accounts to conceal his involvement and receive proceeds from the fraud, which he used for personal expenses, including his mortgage.

In addition to the prison term, Judge Thompson sentenced Qureshi to five years of supervised release.

U.S. Attorney Fishman credited special agents of the FBI’s Cyber Division, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation leading to today’s sentencing. He also thanked postal inspectors under the direction of Inspector in Charge James V. Buthorn, the U.S. Secret Service, Newark Field Office, under the direction of Special Agent in Charge Mark McKevitt, and the U.S. Social Security Administration, Office of the Inspector General, for their roles in the investigation.

The government is represented by Assistant U.S. Attorney Daniel Shapiro and Deputy Chief Zach Intrater of the U.S. Attorney’s Office’s Economic Crimes Unit, and Sarah Devlin of the Assert Forfeiture and Money Laundering Unit.

Defense counsel: Alexander Spiro Esq., New York

NEWARK, N.J. – A Cranbury Township, New Jersey, man was sentenced today to 37 months in prison for failing to report over $1.5 million in income he fraudulently diverted to overseas shell companies, U.S. Attorney Paul J. Fishman announced.

Michael Q. Fu, 53, previously pleaded guilty before U.S. District Court Judge William H. Walls to an information charging him with one count of conspiring to evade income taxes and one substantive count of tax evasion. Judge Walls imposed the sentence today in Newark federal court.

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

Fu and Albert W. Chang, 69, of Princeton Junction, New Jersey, co-owned and operated United Products and Instruments Inc. (UNICO) located in Dayton, New Jersey. UNICO was established by Fu and Chang in 1991 and primarily engaged in the sale and export of microscopes and centrifuges for medical purposes.

As part of the conspiracy, Fu and Chang created two shell companies headquartered in China – Action Towers and Bench Top Laboratories. Fu and Chang then diverted business income to themselves by funneling money to the shell companies’ bank accounts and deducting the diverted funds from UNICO’s corporate tax return as the cost of goods sold or commission.

In addition, Fu and Chang had Shanghai Electric, a Hong Kong based utility company, overbill UNICO by approximately five percent on legitimate invoices. Once the invoices were paid by UNICO, they directed Shanghai Electric to wire transfer the overbilled amount to their accounts in China, which they used for their personal benefit. Fu and Chang failed to report any of that income on their federal income tax returns.

In addition to the prison term, Judge Walls sentenced Fu to three years of supervised release and ordered him to pay restitution of over $870,000.

Chang pleaded guilty to his role in the conspiracy in September 2016 and awaits sentencing.

U.S. Attorney Fishman credited special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen; special agents of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), under the direction of Special Agent in Charge Terence S. Opiola; and officers of the Springfield Police Department, under the direction of Chief John Cook, with the investigation.

The government is represented by Senior Litigation Counsel Margaret Ann Mahoney of U.S. Attorney’s Criminal Division in Newark.

Defense counsel: Steven Seltzer Esq., New York, New York

NEWARK, N.J. – A New York man was arrested for his role in one of the largest credit card fraud schemes ever charged by the Justice Department, U.S. Attorney Paul J. Fishman announced.

Habib Chaudhry, 49, of Valley Stream, New York, was initially charged by complaint in February 2013 and then by indictment in September 2013. Chaudhry has been a fugitive for nearly four years. He is expected to make his initial appearance later today before U.S. Magistrate Judge Leda Dunn Wettre in Newark federal court.

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

Chaudhry was indicted as part of a conspiracy – led by Tahir Lodhi, Babar Qureshi, Ijaz Butt, and others – to fabricate more than 7,000 false identities to obtain tens of thousands of credit cards. Since then, 19 people, have pleaded guilty in connection with the scheme.

The scheme involved a three-step process in which the defendants would make up a false identity by creating fraudulent identification documents and a phony credit profile with the major credit bureaus; pump up the credit of the false identity by providing bogus information about that identity’s creditworthiness; then borrow or spend as much as they could without repaying the debts. The scheme caused more than $200 million in confirmed losses to businesses and financial institutions.

The scope of the criminal fraud enterprise required the conspirators to construct an elaborate network of false identities. Across the country, the conspirators maintained more than 1,800 “drop addresses,” including houses, apartments and post office boxes, which they used as the mailing addresses for the false identities.

U.S. Attorney Fishman credited special agents of the FBI’s Cyber Division, under the direction of Special Agent in Charge Timothy Gallagher in Newark, with the investigation leading the charges. He also thanked postal inspectors with the U.S. Postal Inspection Service, under the direction of Acting Inspector in Charge James V. Buthorn, Newark Division, special agents of the U.S. Secret Service, under the direction of Special Agent in Charge Mark McKevitt, and the U.S. Social Security Administration for their assistance.

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

This case was brought in coordination with President Barack Obama’s 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. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.stopfraud.gov.

TRENTON, N.J. – An Irvington, New Jersey, man today admitted that he stole more than $840,000 from the U.S. Government through a scheme to exchange food stamps for cash, U.S. Attorney Paul J. Fishman announced.

Miguel Antonio Azcona, a/k/a “Miguel A. Azcona-Peralta,” 38, pleaded guilty before U.S. District Judge Mary L. Cooper in Trenton federal court to an information charging him with one count of theft of government funds.

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

Azcona was the owner of New Community Supermarket on Springfield Avenue in Newark, New Jersey. New Community Supermarket was a small grocery that was authorized to accept Supplemental Nutrition and Assistance Program (SNAP) benefits (formerly known as food stamps). Azcona controlled a business bank account for New Community Supermarket to receive the reimbursements for SNAP benefits.

Azcona knew that as a SNAP retailer, he was not allowed to exchange food stamps for cash. Yet from August 2014 through Aug. 11, 2016, Azcona and others, including employees under his supervision, unlawfully redeemed SNAP benefits in exchange for cash rather than food. In return for exchanging SNAP benefits for cash, New Community Supermarket retained a portion of the transaction’s value for Azcona’s benefit.

At his plea hearing, Azcona admitted that his conduct resulted in losses of approximately $840,583.54.

The count of theft of government funds carries 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 set for May 3, 2017.

U.S. Attorney Fishman credited special agents of the U.S. Department of Agriculture, Office of Inspector General, under the direction of Special Agent in Charge Bethanne M. Dinkins in New York; and U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), under the direction of Special Agent in Charge Terence S. Opiola.

The government is represented by Assistant U.S. Attorney Elaine K. Lou of the Criminal Division in Newark.

Defense counsel: David R. Oakley, Esq.

NEWARK, N.J. – A Bronx, New York, man today admitted his role in a scheme to obtain stolen identity information and use it to file phony tax returns with the IRS, U.S. Attorney Paul J. Fishman announced.

Yerfri Castillo, 26, pleaded guilty before U.S. District Judge John Michael Vazquez to an information charging him with one count of conspiracy to steal government funds, one count of theft of government funds, and one count of aggravated identity theft.

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

From January 2013 through May 2015, Castillo conspired with Jhan Luis Mejia Marcelino, 27, Odanys Orlando Rojas, a/k/a “El Fuerte,” 39, both of Bronx, and others to use stolen identities to commit tax refund fraud. Castillo admitted that he and others obtained stolen personal identifying information, including names and Social Security numbers, of victims located in New Jersey, Puerto Rico, and elsewhere. Afterwards, Castillo used the information to file fraudulent federal tax returns. Castillo also admitted that, once they received the refunds, he converted checks to cash or other proceeds for his own benefit.

Altogether, the conspiracy caused losses of over $2.89 million to the U.S. Treasury.

The conspiracy offense is punishable by a maximum potential penalty of five years in prison. The theft of government funds count is punishable by a maximum potential penalty of 10 years in prison. Both counts are punishable by a $250,000 fine, or twice the gain or loss resulting from the offense. The aggravated identity fraud charge is punishable by a mandatory two-year sentence to be served consecutively to any other term imposed. Sentencing is scheduled for May 2, 2017.

Both Mejia and Rojas pleaded guilty to their roles in September 2016 and await sentencing.

U.S. Attorney Fishman credited special agents of the IRS-Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen; postal inspectors of the U.S. Postal Inspection Service, under the direction of Inspector in Charge James V. Buthorn; special agents of the U.S. Postal Service Office of Inspector General, under the direction of Special Agent in Charge Monica Weyler; and special agents of the U.S. Secret Service, Newark Field Office, under the direction of Special Agent in Charge Mark McKevitt, with the investigation.

The government is represented by Assistant U.S. Attorney Elaine K. Lou of the Criminal Division in Newark.

Defense counsel: Edgar L. Fankbonner Esq.

NEWARK, N.J. – A Bergen County, New Jersey, woman was sentenced today to 25 months in prison for her role in conspiring to deposit more than $1 million in fraudulent checks into different bank accounts, U.S. Attorney Paul J. Fishman announced.

Chunhua Jin, 46, of Ridgefield, New Jersey, previously pleaded guilty before U.S. District Judge Kevin McNulty to an information charging her with one count of bank fraud conspiracy. Judge McNulty imposed the sentence today in Newark federal court.

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

From July 2014 to April 2015, Jin and others opened accounts at banks, such as Bank of America, in the names of fake businesses. The conspirators then made small deposits and withdrawals over several weeks to make the accounts appear legitimate. Jin or a conspirator would eventually deposit a fake check for a large dollar amount into the account. The victim banks typically credited some or all of the deposit amount on the fake check for immediate withdrawal. The conspirators then withdrew as much money as possible from the account before the bank realized that the check was fraudulent and blocked further withdrawals. Jin and others made ATM cash withdrawals, submitted cash withdrawal slips and make debit card purchases on merchandise. Jin admitted that the scheme resulted in a loss to the banks of at least $1.7 million.

In addition to the prison term, Judge McNulty sentenced Jin to five years of supervised release and ordered restitution and forfeiture of $1.7 million.

U.S. Attorney Fishman credited postal inspectors of the U.S. Postal Inspection Service, under the direction of Inspector in Charge James V. Buthorn; investigators from the Middlesex County Prosecutor=s Office, under the direction of Prosecutor Andrew C. Carey; and investigators from the Morris County Prosecutor’s Office, under the direction of Prosecutor Fredric M. Knapp with the investigation leading to today’s sentencing.

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

Defense counsel: Peter Weiner Esq., Union City, New Jersey

CAMDEN, N.J. – The U.S. Attorney’s Office filed a complaint today against a corporation which operates a South Jersey day care facility for allegedly violating the Americans with Disabilities Act (ADA) by expelling a child with Down syndrome, U.S. Attorney Paul J. Fishman announced.

The complaint was filed in Camden federal court against Nobel Learning Communities (NLC), a Delaware corporation with its principal place of business in West Chester, Pennsylvania. NLC owns and operates Chesterbrook Academy, a private, pre-school facility in Moorestown, New Jersey.

According to the complaint:

NLC failed to make reasonable modifications for a child with Down syndrome and then expelled the child from Chesterbrook.

Chesterbrook offers day care and education programs for children from six weeks old through kindergarten. The child in this case was enrolled at Chesterbrook when less than a year old. Approximately two years after enrolling, Chesterbrook notified the parents that their child was being moved from the “beginner” program to the “intermediate” program. The parents provided the school with literature on delayed toilet training in children with Down syndrome. The child was moved into the intermediate program, and the principal informed the parents that the school was going to work on getting the child toilet trained by a set date. Approximately two months later, the school notified the child’s parents that it was expelling their child because the child was not toilet trained. The parents requested various modifications to allow the child to remain enrolled, but the school refused to implement the modifications and expelled the child.

The federal civil suit seeks, among other things, a judgment against NLC for violation of the ADA, an injunction against the company to prevent discrimination against individuals with disabilities, compensatory damages to be awarded to the child and the child’s parents and a civil penalty against NLC.

Individuals who believe they may have been victims of discrimination may file a complaint with the U.S Attorney’s Office at http://www.justice.gov/usao-nj/civil-rights-enforcement/complaint. Additional information about the ADA can be found at www.ada.gov, or by calling the Department of Justice’s toll-free information line at (800) 514-0301 and (800) 514-0383 (TDD).

The government is represented by Assistant U.S. Attorney Jordan M. Anger of the U.S. Attorney’s Office Civil Division in Newark.

NEWARK, N.J. – A Berkeley Heights, New Jersey, man was sentenced today to 20 months in prison for bribing a doctor in exchange for test referrals as part of a long-running and elaborate scheme operated by Biodiagnostic Laboratory Services LLC (BLS), of Parsippany, New Jersey, its president and numerous associates, U.S. Attorney Paul J. Fishman announced.

Michael J. Zarrelli, 50, previously pleaded guilty before U.S. District Judge Stanley R. Chesler to an information charging him with one count of conspiring to bribe a doctor and one count of money laundering. Judge Chesler imposed the sentence today in Newark federal court.

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

Zarrelli admitted he agreed with BLS president David Nicoll, 42, of Mountain Lakes, New Jersey, his brother, Scott Nicoll, 36, of Wayne, New Jersey, and others to pay cash bribes to a doctor in return for referring patient blood specimens to BLS. The referrals sent to BLS by the doctor that Zarrelli bribed generated more than $400,000 in lab business for BLS.

In addition to the prison term, Judge Chesler sentenced Zarrelli to one year of supervised release. Zarrelli must also forfeit $247,264, representing the payment he received from BLS.

The investigation has thus far resulted in 41 guilty pleas – 27 of them from doctors – in connection with the bribery scheme, which its organizers have admitted involved millions of dollars in bribes and resulted in more than $100 million in payments to BLS from Medicare and various private insurance companies. It is believed to be the largest number of medical professionals ever prosecuted in a bribery case.

The investigation has to date recovered more than $12 million through forfeiture. On June 28, 2016, BLS, which is no longer operational, pleaded guilty and was required to forfeit all of its assets.

U.S. Attorney Fishman 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; IRS–Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen; and the U.S. Department of Health and Human Services, Office of Inspector General, under the direction of Special Agent in Charge Scott J. Lampert with the ongoing investigation

The government is represented by Assistant U.S. Attorneys Joseph N. Minish and Danielle Alfonzo Walsman, and Jacob T. Elberg, Chief of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark, as well as Barbara Ward, Acting Chief of the office’s Asset Forfeiture and Money Laundering Unit.

U.S. Attorney Paul J. Fishman reorganized the health care fraud practice at the New Jersey U.S. Attorney’s Office shortly after taking office, including creating a stand-alone Health Care and Government Fraud Unit to handle both criminal and civil investigations and prosecutions of health care fraud offenses. Since 2010, the office has recovered more than $1.32 billion in health care fraud 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: Michael Critchley Esq., Roseland, New Jersey

NEWARK, N.J. – A Bronx, New York, man who was arrested on Jan. 13, 2017 in connection with a Fort Lee, New Jersey, bank robbery will make his initial court appearance tomorrow, U.S. Attorney Paul J. Fishman announced today.

Andres Dominguez, 38, is charged by complaint with one count of bank robbery and is scheduled to make his initial appearance before U.S. Magistrate Judge James B. Clark III in Newark federal court tomorrow.

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

On Jan. 12, 2017, Dominguez allegedly robbed the Bank of New Jersey in Fort Lee. According to bank employees and video surveillance, a man wearing a gray Nike hooded sweatshirt, a blue rubber glove, sunglasses, a wool hat, Adidas pants, and white sneakers entered the bank.

The robber approached one of the bank tellers with a large kitchen knife in his right hand and jumped onto the counter separating the tellers from customers. He then verbally demanded money from the teller and instructed the teller to give him all the money in the teller drawers or he would kill her. The teller complied, and the robber jumped back over the counter and fled the bank on foot. The robber was later identified as Dominguez.

When law enforcement later searched the area around the bank for evidence of the bank robbery, they recovered a large kitchen knife from a dumpster behind the bank. They also found two blue rubber gloves, a gray Nike hooded sweatshirt, and a dark wool hat on the street at various locations within a few blocks of the bank. Law enforcement later located Dominguez in the Bronx and arrested him.

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

U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, and officers of the Fort Lee Police Department, under the direction of Chief Keith M. Bendul, with the investigation.

The government is represented by Assistant U.S. Attorney Jason S. Gould of the U.S. Attorney’s Office General Crimes Unit in Newark.

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

WASHINGTON – McKesson Corp. (McKesson), one of the nation’s largest distributors of pharmaceutical drugs, has agreed to pay a record $150 million civil penalty for alleged violations of the Controlled Substances Act (CSA), U.S. Attorney Paul J. Fishman and DEA Special Agent in Charge Carl J. Kotowski announced today.
 

“The epidemic of opioid abuse is carving an increasingly destructive path through our country,” U.S. Attorney Fishman said. “But nearly a decade ago, McKesson was sanctioned for violations that were contributing to the misuse of these prescription painkillers. Given a chance to implement a more robust system for monitoring the distribution of these products, the company instead chose to ignore its own compliance regime in favor of a bigger bottom-line. The consequences of McKesson's decision to circumvent its obligations are too devastating to ignore and warrant today's punishment.”

“Pharmaceutical companies are our first line of defense in the fight against prescription opioid abuse,” SAC Kotowski said. “If they turn a blind eye to suspicious orders of pharmaceutical controlled substances they are contributing to this epidemic. This settlement sends a clear message that even corporations need to do their part to fight this devastating opioid epidemic.”

The nationwide settlement requires McKesson to suspend sales of controlled substances from distribution centers in Colorado, Ohio, Michigan and Florida for multiple years. The staged suspensions are among the most severe sanctions ever agreed to by a DEA registered distributor. The settlement also imposes new and enhanced compliance obligations on McKesson’s distribution system.

In 2008, McKesson agreed to a $13.25 million civil penalty and administrative agreement for similar violations. In this case, the government alleged again that McKesson failed to design and implement an effective system to detect and report “suspicious orders” for controlled substances distributed to its independent and small chain pharmacy customers – orders that are unusual in their frequency, size, or other patterns. From 2008 until 2013, McKesson supplied various U.S. pharmacies an increasing amount of oxycodone and hydrocodone pills, frequently misused products that are part of the current opioid epidemic.

The government’s investigation developed evidence that even after designing a compliance program after the 2008 settlement, McKesson did not fully implement or adhere to its own program. In Colorado, for example, McKesson processed more than 1.6 million orders for controlled substances from June 2008 through May 2013, but reported just 16 orders as suspicious, all connected to one instance related to a recently terminated customer.

In addition to the monetary penalties and suspensions, the government and McKesson agreed to enhanced compliance terms for the next five years. Among other things, McKesson has agreed to specific, rigorous staffing and organizational improvements; periodic auditing; and stipulated financial penalties for failing to adhere to the compliance terms. Critically, the settlement will require McKesson to engage an independent monitor to assess compliance – the first independent monitor of its kind in a CSA civil penalty settlement.

This was a multi-district investigation that involved DEA Field Divisions in the following locations: Boston, Chicago, Denver, Detroit, Miami, Newark, San Francisco, St. Louis, and the Washington District Office. The following U.S. Attorney’s Offices participated in the case: Central District of California, Eastern District of California, District of Colorado, Middle District of Florida, Eastern District of Kentucky, Northern District of Illinois, District of Massachusetts, Eastern District of Michigan, District of Nebraska, District of New Jersey, Northern District of West Virginia, and Western District of Wisconsin.

In the District of New Jersey, the government was represented by Senior Litigation Counsel Anthony J. LaBruna and Assistant U.S. Attorney Mark Orlowski of the Civil Division of the U.S. Attorney’s Office.

U.S. Attorneys’ Offices for the District of Colorado and the Northern District of West Virginia, along with DEA Office of Chief Counsel and Diversion Control Division, led the civil settlement negotiations. DEA’s Denver, Detroit and Miami Field Divisions, and its Washington Division Office led the administrative and civil investigation. The Criminal Division’s Narcotic and Dangerous Drug Section (NDDS) also coordinated and assisted in negotiating certain portions of the settlement.

CAMDEN, N.J. - A Camden man today admitted his role in a crack cocaine distribution conspiracy operating in Camden, U.S. Attorney Paul J. Fishman announced.

Jason Boyd, a/k/a “Teddy,” a/k/a “Teddy Reek,” and a/k/a “Fatboy,” 36, pleaded guilty before U.S. District Judge Jerome B. Simandle in Camden federal court to an information charging him with one count of conspiracy to distribute and to possess with intent to distribute cocaine base and one count of possession of a firearm in furtherance of a drug trafficking crime.

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

Boyd admitted that he sold, and directed others to sell, crack cocaine in and around the 1100 block of Lansdowne Avenue in Camden. Boyd also admitted that he provided crack cocaine to other members of the conspiracy and collected proceeds from the sales.

Boyd, who was one of the leaders of the conspiracy, was charged along with seven others in September 2016 following an investigation by the FBI’s South Jersey Violent Offender and Gang Task Force. During the investigation, law enforcement recovered a .40 caliber handgun that was kept by the conspirators in connection with their drug trafficking activities.

The distribution conspiracy charge carries a maximum potential penalty of 20 years in prison and a $1 million fine. The firearms charge carries a mandatory minimum sentence of five years in prison to be served consecutively to the conspiracy charge. Sentencing is scheduled for April 28, 2017.

Codefendant Derek Stallworth, a/k/a “AK” and a/k/a “A,” 20, of Camden, pleaded guilty to his role in the conspiracy on Dec. 8, 2016 and is scheduled to be sentenced on March 24, 2017.

U.S. Attorney Fishman credited special agents of the FBI’s South Jersey Violent Offender and Gang Task Force, South Jersey Resident Agency, under the direction of Special Agent in Charge Michael Harpster; the Camden County Police Department, under the direction of Chief J. Scott Thomson; the Camden County Prosecutor’s Office, under the direction of Prosecutor Mary Eva Colalillo; and the N.J. State Police, under the direction of Col. Rick Fuentes, with the investigation.

He also thanked the Camden County Sheriff’s Department, the Cherry Hill Police Department, and the U.S. Department of Homeland Security Investigations (HSI) for their assistance.

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

Defense counsel: Jose Ongay Esq., Mount Ephraim, New Jersey

TRENTON, N.J. – An Ocean County, New Jersey, man was sentenced today to 120 months in prison for robbing eight banks in New Jersey and New York, U.S. Attorney Paul J. Fishman announced.

Steven Wisnowski, 33, of Barnegat, New Jersey, previously pleaded guilty before U.S. District Judge Peter J. Sheridan in Trenton federal court to an eight-count superseding information charging him with the bank robberies.

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

Wisnowski admitted that between Oct. 30, 2013, and Jan. 7, 2014, he robbed eight banks, seven of which were in New Jersey, and one of which was in New York:

Bank Name

Location

Date

PNC Bank

Edison

Oct. 30, 2013

TD Bank

Brick

Nov. 7, 2013

Santander Bank

Brick

Nov. 15, 2013

Ridgewood Savings Bank

Bayside (NY)

Nov. 22, 2013

Columbia Bank

Edison

Nov. 27, 2013

TD Bank

Toms River

Dec. 2, 2013

PNC Bank

Aberdeen

Dec. 9, 2013

Fulton Bank

Edison

Jan. 7, 2014

Wisnowski used a similar procedure for each robbery: he entered the banks wearing hats, hooded jackets, and wigs to conceal his identity, approached the bank tellers, and demanded money. In some instances, Wisnowski made the tellers believe he was armed and also threatened some tellers with violence.

During the Columbia Bank robbery, Wisnowski appeared to point something at the teller from under his clothing, as if he had a gun. Wisnowski then demanded money, stating: “Give me all your hundreds.” As the teller gathered the money, Wisnowski counted backwards from 10. He then fled with the money.

During the Fulton Bank robbery, Wisnowski gave a teller a manila envelope and stated, “Give me what I want and nobody gets hurt. I want large bills.” He then pulled up his sweatshirt as if he had a gun. The teller gathered the money and placed it in the envelope, after which Wisnowski fled.

Law enforcement tracked Wisnowski’s vehicle to the scene of the Fulton Bank robbery. Officers approached Wisnowski as he exited the bank and ordered him to the ground at gunpoint. Wisnowski threw the envelope filled with cash and fled. Law enforcement officers pursued Wisnowski and apprehended him moments later.

In addition to the prison term, Judge Sheridan sentenced Wisnowski to three years of supervised release and ordered to pay restitution of $22,240.

U.S. Attorney Fishman praised 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 Edison, Aberdeen, Brick, Toms River, and New York City police departments, and the Middlesex, Ocean, and Monmouth County prosecutors’ offices for their contributions to the case.

The government is represented by Assistant U.S. Attorney Jamari Buxton of the U.S. Attorney’s Organized Crime/Gangs Unit in Newark.

Defense counsel: Chester Keller Esq., Assistant Federal Public Defender, Newark

The Department of Justice, 21 states, and the District of Columbia reached a nearly $864 million settlement agreement with Moody’s Investors Service Inc., Moody’s Analytics Inc., and their parent, Moody’s Corporation, the Department announced today. The settlement resolves allegations arising from Moody’s role in providing credit ratings for Residential Mortgage-Backed Securities (RMBS) and Collateralized Debt Obligations (CDO), contributing to the worst financial crisis since the Great Depression.　

The agreement resolves pending state court lawsuits in Connecticut, Mississippi, and South Carolina, as well as potential claims by the Justice Department, 18 states and the District of Columbia.

The settlement follows an investigation by the Justice Department’s Consumer Protection Branch and the U.S. Attorney’s Office for the District of New Jersey into potential claims pursuant to the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA) and investigations conducted by various State Attorneys General pursuant to state law.

"Moody’s failed to adhere to its own credit rating standards and fell short on its pledge of transparency in the run-up to the Great Recession," said Principal Deputy Associate Attorney General Bill Baer.　 "Today’s settlement contains not only a significant penalty and factual admissions of its conduct, but also a commitment by Moody’s to new and continued compliance measures designed to ensure the integrity of credit ratings going forward."

"Our investigation revealed, and Moody’s has now acknowledged, that Moody’s used a more lenient standard than it had itself published," said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. "Investors relied on Moody’s credit ratings to be objective and independent, and they naturally expected Moody’s to follow its own published methods."

"Moody’s touted a particularly robust analytical framework for rating RMBS and CDOs," said U.S. Attorney Paul J. Fishman for the District of New Jersey. "Moody’s now admits that it deviated from its methodologies and failed to disclose those changes to the public. People making decisions on how to invest their money thought they could rely on the ratings Moody’s assigned to these products. When securities are not rated openly and honestly, individual investors suffer, as does confidence in all parts of the financial sector."

The multi-faceted settlement includes a Statement of Facts in which Moody’s acknowledges key aspects of its conduct, and a compliance agreement to prevent future violations of law. The Statement of Facts addresses Moody’s representations to investors and the public generally about: (1) its objectivity and independence; (2) its management of conflicts of interest; (3) its compliance with its own stated RMBS and CDO rating methodologies and standards; and (4) the analytic integrity of certain rating methodologies.

The Statement of Facts addresses whether Moody’s credit ratings were compromised by what Moody’s itself acknowledged were the conflicts of interest inherent in the so-called "issuer pay" model, under which Moody’s and other credit rating agencies are selected by the same entity that puts together and markets the rated securities and therefore stands to benefit from higher credit ratings.

Among other things, Moody’s acknowledges in the Statement of Facts:

• Moody’s published and maintained online its "Code of Professional Conduct" for the stated purpose of promoting the "integrity, objectivity, and transparency of the credit ratings process," including managing conflicts of interest that it publicly acknowledged arose from the fact that RMBS and CDO issuers determined whether to retain Moody’s to rate these securities.
• Moody’s acknowledges that it passed these conflicts on to the managing directors of the business units, who were then asked to resolve the "dilemma" between maintaining ratings quality and the need to win business from the issuers that selected them.
• Moody’s publicly stated that its ratings "primarily address the expected credit loss an investor might incur," which included its assessment of both the "probability of default" and the "loss given default" of rated securities.
• Starting in 2001, Moody’s RMBS group began using an internal tool in rating RMBS that did not calculate the loss given default or expected loss for RMBS below Aaa and did not incorporate Moody’s own rating standards. Instead, the tool was designed to "replicate" ratings that had been assigned based on a previous model that calculated expected loss for each tranche and incorporated Moody’s rating level standards. In October 2007, a senior manager in Moody’s Asset Finance Group (AFG) noted the following about Moody’s RMBS ratings derived from the tool: "I think this is the biggest issue TODAY. [A Moody’s AFG Senior Vice President and research manager]’s initial pass shows that our ratings are 4 notches off."
• Starting in 2004, Moody’s did not follow its published idealized expected loss standards in rating certain Aaa CDO securities. Instead, Moody’s began using a more lenient standard for rating these Aaa securities but did not issue a publication about this practice to the general market.
• In 2005, Moody’s authorized the expanded use of this practice to all Aaa CDO securities and, in 2006, formally authorized the use of this practice, or of an even more lenient standard, to all Aaa structured finance securities. Throughout this period, although "[m]any arrangers and issuers were aware" that Moody’s was using a more lenient Aaa standard, Moody’s did not issue publications about these decisions to the general market.

The Statement of Facts further addresses other important aspects of Moody’s rating methodologies, including its "inconsistent use of present value discounts" in assigning CDO ratings and its selection of assumptions about the correlations between assets in CDOs.

Under the terms of the compliance commitments, Moody’s agrees to maintain a host of measures designed to ensure the integrity of its credit ratings.　 These include:

• Separation of Moody’s commercial and credit rating functions by excluding analytical personnel from any commercial related discussions and excluding personnel responsible for commercial functions from determining credit ratings or developing rating methodologies;
• Independent review and approval of changes to rating methodologies by maintaining separate groups to develop and review rating methodologies;
• Changes to ensure that specified personnel are not compensated on the basis of the company’s financial performance;
• Enhancing Moody’s oversight functions to monitor the content of press releases and the timeliness of methodology development;
• Deploying new technological platforms and centralized systems for documentation of rating procedures; and
• Certifications of compliance by the President/CEO of Moody’s with these commitments for at least five years.

"The Department of Justice is committed to working with companies that are willing to admit what they did and take steps to enhance compliance," said Deputy Assistant Attorney General Jonathan Olin for the Department’s Consumer Protection Branch. "Non-monetary measures such as those agreed to today are part of the Department’s comprehensive approach to protect the American people by promoting a culture of compliance across industries."　

The settlement includes a $437.5 million federal civil penalty, which is the second largest payment of this type ever made to the federal government by a ratings agency. The remainder will be distributed among the settlement member states in alignment with terms of the agreement. The states involved in today’s settlement include Arizona, California, Connecticut, Delaware, Idaho, Illinois, Indiana, Iowa, Kansas, Maine, Maryland, Massachusetts, Mississippi, Missouri, New Hampshire, New Jersey, North Carolina, Oregon, Pennsylvania, South Carolina and Washington as well as the District of Columbia.

The matter was handled by Consumer Protection Branch Senior Litigation Counsel Sondra L. Mills, and Trial Attorney James T. Nelson; and by the U.S. Attorney’s Office District of New Jersey Deputy Chief, Civil Division Leticia Vandehaar and Assistant U.S. Attorneys Thomas G. Strong and Alex S. Weinberg.

For more information about the Consumer Protection Branch and its enforcement efforts, visit its website at http://www.justice.gov/civil/consumer-protection-branch. For more information about the U.S. Attorney’s Office for the District of New Jersey, visit its website at http://www.justice.gov/usao-nj.

NEWARK, N.J. – The U.S. Department of Justice, 21 other states, and the District of Columbia reached a $864 million settlement agreement with Moody’s Investors Service Inc., Moody’s Analytics Inc. and their parent, Moody’s Corporation, the Department announced today. The settlement resolves allegations arising from Moody’s role in providing credit ratings for Residential Mortgage-Backed Securities (RMBS) and Collateralized Debt Obligations (CDO), contributing to the worst financial crisis since the Great Depression.

The agreement resolves pending state court lawsuits in Connecticut, Mississippi, and South Carolina, as well as potential claims by the Justice Department, 18 states and the District of Columbia.

The settlement follows an investigation by the U.S. Attorney’s Office for the District of New Jersey and the Justice Department’s Consumer Protection Branch into potential claims pursuant to the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA) and investigations conducted by various State Attorneys General pursuant to state law.

“Moody’s touted a particularly robust analytical framework for rating RMBS and CDOs,” U.S. Attorney Fishman said. “Moody’s now admits that it deviated from its methodologies and failed to disclose those changes to the public. People making decisions on how to invest their money thought they could rely on the ratings Moody’s assigned to these products. When securities are not rated openly and honestly, individual investors suffer, as does confidence in all parts of the financial sector.”

“Moody’s failed to adhere to its own credit rating standards and fell short on its pledge of transparency in the run-up to the Great Recession,” said Principal Deputy Associate Attorney General Bill Baer.  “Today’s settlement contains not only a significant penalty and factual admissions of its conduct, but also a commitment by Moody’s to new and continued compliance measures designed to ensure the integrity of credit ratings going forward.”

“Our investigation revealed, and Moody’s has now acknowledged, that Moody’s used a more lenient standard than it had itself published,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. “Investors relied on Moody’s credit ratings to be objective and independent, and they naturally expected Moody’s to follow its own published methods.”

The multi-faceted settlement includes a Statement of Facts in which Moody’s acknowledges key aspects of its conduct, and a compliance agreement to prevent future violations of law. The Statement of Facts addresses Moody’s representations to investors and the public generally about: (1) its objectivity and independence; (2) its management of conflicts of interest; (3) its compliance with its own stated RMBS and CDO rating methodologies and standards; and (4) the analytic integrity of certain rating methodologies.

The Statement of Facts addresses whether Moody’s credit ratings were compromised by what Moody’s itself acknowledged were the conflicts of interest inherent in the so-called “issuer pay” model, under which Moody’s and other credit rating agencies are selected by the same entity that puts together and markets the rated securities and therefore stands to benefit from higher credit ratings.

Among other things, Moody’s acknowledges in the Statement of Facts:

• Moody’s published and maintained online its “Code of Professional Conduct” for the stated purpose of promoting the “integrity, objectivity, and transparency of the credit ratings process,” including managing conflicts of interest that it publicly acknowledged arose from the fact that RMBS and CDO issuers determined whether to retain Moody’s to rate these securities.

• Moody’s acknowledges that it passed these conflicts on to the managing directors of the business units, who were then asked to resolve the “dilemma” between maintaining ratings quality and the need to win business from the issuers that selected them.

• Moody’s publicly stated that its ratings “primarily address the expected credit loss an investor might incur,” which included its assessment of both the “probability of default” and the “loss given default” of rated securities.

• Starting in 2001, Moody’s RMBS group began using an internal tool in rating RMBS that did not calculate the loss given default or expected loss for RMBS below Aaa and did not incorporate Moody’s own rating standards. Instead, the tool was designed to “replicate” ratings that had been assigned based on a previous model that calculated expected loss for each tranche and incorporated Moody’s rating level standards. In October 2007, a senior manager in Moody’s Asset Finance Group (AFG) noted the following about Moody’s RMBS ratings derived from the tool: “I think this is the biggest issue TODAY. [A Moody’s AFG Senior Vice President and research manager]’s initial pass shows that our ratings are 4 notches off.”

• Starting in 2004, Moody’s did not follow its published idealized expected loss standards in rating certain Aaa CDO securities. Instead, Moody’s began using a more lenient standard for rating these Aaa securities but did not issue a publication about this practice to the general market.

• In 2005, Moody’s authorized the expanded use of this practice to all Aaa CDO securities and, in 2006, formally authorized the use of this practice, or of an even more lenient standard, to all Aaa structured finance securities. Throughout this period, although “[m]any arrangers and issuers were aware” that Moody’s was using a more lenient Aaa standard, Moody’s did not issue publications about these decisions to the general market.

The Statement of Facts further addresses other important aspects of Moody’s rating methodologies, including its “inconsistent use of present value discounts” in assigning CDO ratings and its selection of assumptions about the correlations between assets in CDOs.

Under the terms of the compliance commitments, Moody’s agrees to maintain a host of measures designed to ensure the integrity of its credit ratings. These include:

• Separation of Moody’s commercial and credit rating functions by excluding analytical personnel from any commercial related discussions and excluding personnel responsible for commercial functions from determining credit ratings or developing rating methodologies;

• Independent review and approval of changes to rating methodologies by maintaining separate groups to develop and review rating methodologies;

• Changes to ensure that specified personnel are not compensated on the basis of the company’s financial performance;

• Enhancing Moody’s oversight functions to monitor the content of press releases and the timeliness of methodology development;

• Deploying new technological platforms and centralized systems for documentation of rating procedures; and

• Certifications of compliance by the President/CEO of Moody’s with these commitments for at least five years.

“The Department of Justice is committed to working with companies that are willing to admit what they did and take steps to enhance compliance,” said Deputy Assistant Attorney General Jonathan Olin for the Department’s Consumer Protection Branch. “Non-monetary measures such as those agreed to today are part of the Department’s comprehensive approach to protect the American people by promoting a culture of compliance across industries.”

The settlement includes a $437.5 million civil penalty, which is the second largest payment of this type ever made to the federal government by a ratings agency. The remainder will be distributed among the settlement member states in alignment with terms of the agreement. The states involved in today’s settlement include Arizona, California, Connecticut, Delaware, Idaho, Illinois, Indiana, Iowa, Kansas, Maine, Maryland, Massachusetts, Mississippi, Missouri, New Hampshire, New Jersey, North Carolina, Oregon, Pennsylvania, South Carolina and Washington as well as the District of Columbia.

The matter was handled by Consumer Protection Branch Director Michael S. Blume, Senior Litigation Counsel Sondra L. Mills, and Trial Attorney James T. Nelson; and by the U.S. Attorney’s Office District of New Jersey Deputy Chief, Civil Division Leticia Vandehaar and Assistant U.S. Attorneys Thomas G. Strong and Alex S. Weinberg.

For more information about the Consumer Protection Branch and its enforcement efforts, visit its website at http://www.justice.gov/civil/consumer-protection-branch. For more information about the U.S. Attorney’s Office for the District of New Jersey, visit its website at http://www.justice.gov/usao-nj.

NEWARK, N.J. – An Amtrak supervisor today admitted fraudulently overbilling Amtrak overtime and regular hours that he claimed to be working when he was actually not present at Amtrak work sites, U.S. Attorney Paul J. Fishman announced.

Donald Harper Sr., 47, of Somerset, New Jersey, pleaded guilty before U.S. Magistrate Judge Michael A. Hammer in Newark federal court to an information charging him with one count of converting to his own use federal government funds.

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

Harper, who has been employed by Amtrak since February 1990, supervised 19 employees in a work gang on the Signals side of the Communications and Signals Department of Amtrak’s New York Division. During the summer of 2015, Amtrak employees under Harper’s supervision performed work on a project known as the Positive Train Control installation, which was a project, mandated by Congress, to put in place advanced technological components that could automatically stop or slow a train in order to prevent accidents or derailments. Between October 2014 and October 2015, Harper fraudulently billed Amtrak for 27.75 regular hours and 192.25 overtime hours when he was not actually present at Amtrak work sites, resulting in a loss to Amtrak of over $20,000.

The count to which Harper pleaded guilty carries a maximum potential penalty of one year in prison and a fine of $250,000, or twice the gain or loss resulting from the offense, whichever is greater. The terms of the plea agreement require Harper to make full restitution of $20,346. Sentencing is scheduled for April 20, 2017.

U.S. Attorney Fishman credited special agents of Amtrak’s Office of Inspector General, Office of Investigations, Philadelphia office, under the direction of Special Agent in Charge Robert J. Koons, with the investigation leading to today’s guilty plea.

The government is represented by Assistant U.S. Attorney Mala Ahuja Harker of the U.S. Attorney’s Office Special Prosecutions Division.

Defense counsel: Linda Foster Esq., Assistant Federal Public Defender

NEWARK, N.J. – A Brooklyn, New York, man who was on the FBI’s 10 Most Wanted Fugitive List in 1988 was sentenced today to 240 months in prison for robbing a TD Bank in Oakland, New Jersey, in April 2013, U.S. Attorney Paul J. Fishman announced.  
 
John Edward Stevens, 63, previously pleaded guilty before U.S. District Judge Claire C. Cecchi to Count Two of an indictment charging him with armed bank robbery. Judge Cecchi imposed the sentence today in Newark federal court.
 
According to documents filed in this case and statements made in court:   Stevens admitted that on April 15, 2013, he robbed a TD Bank in Oakland. After entering the bank, Stevens approached several bank employees while carrying a zipper pouch. He opened the zipper pouch, pulled out what appeared to be a black handgun, and brandished it at one of the bank employees. He then took several thousand dollars in cash and fled the scene.
 
Approximately 20 minutes after the robbery, law enforcement stopped a vehicle that was reported stolen. The driver of the stolen vehicle was identified as Stevens. Law enforcement arrested Stevens and located a TD Bank bag filled with money in the vehicle.
 
Stevens has been convicted of at least eight prior armed bank robberies in the Central District of California and the Southern District of Ohio.
 
In addition to the prison term, Judge Cecchi sentenced Stevens to three years of supervised release.
 
U.S. Attorney Fishman 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 plea. He also thanked the Waldwick Police Department, the Oakland Police Department, the Ho-Ho-Kus Police Department and the Bergen County Sheriff’s Office for their contributions to the case.
 
The government is represented by Assistant U.S. Attorney Melissa Wangenheim of the Criminal Division in Newark.
 
Defense counsel: Lorraine Gauli-Rufo Esq., Verona, New Jersey

NEWARK, N.J. – A doctor practicing in Passaic County, New Jersey, was charged today with accepting bribes in exchange for test referrals as part of a long-running and elaborate scheme operated by Biodiagnostic Laboratory Services LLC (BLS), of Parsippany, New Jersey, its president and numerous associates, U.S. Attorney Paul J. Fishman announced.

Salvatore Conte, 52, of Totowa, New Jersey, is charged by indictment with one count of conspiring to commit violations of the Anti-Kickback Statute, the Federal Travel Act and wire fraud; three substantive violations of the Anti-Kickback Statute; three substantive violations of the Federal Travel Act; and three substantive violations of wire fraud. Conte will be arraigned at a later date.

According to the indictment:

From February 2009 through April 2013, Conte received bribes totaling approximately $130,000 from BLS employees and associates. Conte periodically solicited, and received from the BLS employees and associates, monthly bribe payments in the form of sham rental, service agreement, and consultant payments. Conte’s referrals generated approximately $525,000 in lab business for BLS.

Conte is the fifth physician to be indicted in connection with the BLS bribery scheme. Ahmed El Soury and Thomas Savino were indicted on Dec. 13, 2016 and Dec. 20, 2016, respectively. Brett Ostrager – who was indicted Aug. 11, 2015 and pleaded guilty on Dec. 22, 2015 – was sentenced on June 8, 2016 to 37 months in prison. Bernard Greenspan was indicted on March 14, 2016 and is scheduled for trial on Jan. 31, 2017.

The investigation has thus far resulted in 41 guilty pleas – 27 of them from doctors – in connection with the bribery scheme, which its organizers have admitted involved millions of dollars in bribes and resulted in more than $100 million in payments to BLS from Medicare and various private insurance companies. It is believed to be the largest number of medical professionals ever prosecuted in a bribery case.

The investigation has to date recovered more than $12 million through forfeiture. On June 28, 2016, BLS, which is no longer operational, pleaded guilty and was required to forfeit all of its assets.

The Anti-Kickback and Federal Travel Act counts are each punishable by a maximum potential penalty of five years in prison. The wire fraud charges are each punishable by a maximum potential penalty of 20 years in prison. Each count also carries a maximum $250,000 fine, or twice the gross gain or loss from the offense.

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

U.S. Attorney Fishman 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; IRS–Criminal Investigation, under the direction of Special Agent in Charge Jonathan D. Larsen; and the U.S. Department of Health and Human Services, Office of Inspector General, under the direction of Special Agent in Charge Scott J. Lampert with the ongoing investigation.

The government is represented by Assistant U.S. Attorneys Joseph N. Minish and Danielle Alfonzo Walsman, and Jacob T. Elberg, Chief of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark, as well as Barbara Ward, Acting Chief of the office’s Asset Forfeiture and Money Laundering Unit.

U.S. Attorney Paul J. Fishman reorganized the health care fraud practice at the New Jersey U.S. Attorney’s Office shortly after taking office, including creating a stand-alone Health Care and Government Fraud Unit to handle both criminal and civil investigations and prosecutions of health care fraud offenses. Since 2010, the office has recovered more than $1.32 billion in health care fraud 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: Robert Baer Esq., Wayne, New Jersey

NEWARK, N.J. – A former union official and an insurance broker have been charged in connection with their roles in conspiring to defraud Horizon Blue Cross Blue Shield and the United Auto Workers (UAW) Local 2326 Health Care Plan of millions of dollars, U.S. Attorney Paul J. Fishman announced today.

Sergio Acosta, 66, of Passaic New Jersey, formerly the president of Local 2326, and Lawrence Ackerman, 53, of Old Tappan, New Jersey, were both indicted by a federal grand jury on one count each of conspiring to defraud Horizon Blue Cross Blue Shield and one count each of conspiring to defraud the union’s self-insured health care plan. An arraignment for both defendants will be scheduled at a later date.

According to the indictment:

Acosta was an employee of Local 2326 and was its president from 2002 to 2008. During this time, he was responsible for conducting the union’s operations as well as its benefits plan. In 2008, he became a representative and employee of the UAW International Union, yet continued to serve as the union’s trustee to the benefit plan.

Ackerman was the chief operating officer of Atlantic Business Associates ABA, Atlantic Medical Associates (AMA), AM Law, Atlantic International Group and Pro-Tech Automotive services. In actuality ABA and AMA were “shell” companies allegedly created by Ackerman, through which he marketed health insurance nationally to people who were not, in fact, employees of ABA and AMA. He used ABA and AMA to create the appearance of employment status for individuals who were improperly seeking health care coverage through the benefit plan.

Acosta and Ackerman allegedly conspired to defraud Horizon Blue Cross Blue Shield of $5.6 million by covering 700 to 800 ineligible participants recruited by Ackerman from across the country. After Horizon discovered the fraud and rescinded its coverage from Local 2326, Acosta allegedly permitted the same ineligible participants to continue being covered by the Local 2326 self-insured health care plan. After just five months, an additional $1 million in losses were incurred.

Each of the counts with which the defendants are charged carries a maximum penalty of 10 years in prison and a $250,000 fine.

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

U.S. Attorney Fishman credited special agents of the U.S. Department of Labor, Office of Inspector General, New York Region, under the direction of Special Agent in Charge Michael Mikulka; the Office of Employee Benefit Security Act (EBSA), under the direction of Regional Director Jonathan Kay; and the Office of Labor Management Standards, under the supervision of District Director Andriana Vamvakas, with the investigation leading to today’s charges.

The government is represented by Senior Litigation Counsel V. Grady O’Malley of the U.S. Attorney’s Office’s Organized Crime/Gangs Unit.

Defense counsel:

Ackerman: Robert Kipnees Esq., Roseland, New Jersey

Acosta, Alan Silber Esq., Roseland, New Jersey