District Not Recorded

As the result of long-running litigation to redress invasion of consumer privacy, most notably through violation of the National Do Not Call Registry brought by the U.S. Department of Justice as well as the States of California, Illinois, North Carolina, and Ohio, a federal court in Illinois has ordered penalties totaling $280 million and strong injunctive relief against Englewood, Colorado-based satellite television provider Dish Network.

A Federal Trade Commission (FTC) investigation determined that Dish Network violated the FTC’s Telemarketing Sales Rule, which includes provisions prohibiting telemarketing calls to phone numbers on the National Do Not Call Registry, telemarketing calls to persons who have asked a seller not to call them, and provisions prohibiting robocalls. The FTC referred the case to the Department of Justice, which filed suit in 2009.

The case went to trial in January 2016, before U.S. District Judge Sue E. Myerscough of the Central District of Illinois. The bench trial lasted approximately five weeks. In her ruling issued yesterday, Judge Myerscough found that Dish Network violated the do not call laws and invaded the privacy rights of American consumers, and that it knew or should have known that its actions were illegal.

Judge Myerscough also found that Dish Network was liable for the telemarketing violations of its so-called “retailers”—call centers that sold Dish Network programming by any means necessary. “Dish’s reckless decision to use anyone with a call center without any vetting or meaningful supervision demonstrates a disregard for the consuming public,” the judge wrote in her 475-page opinion. She went on to note the total penalty amount was appropriate given that “Dish caused millions and millions of violations of the Do Not Call Laws, and Dish has minimized the significance of its own errors in direct telemarketing and steadfastly denied any responsibility for the actions of its [retailers]. The injury to consumers, the disregard for the law, and the steadfast refusal to accept responsibility require a significant and substantial monetary award.”

“The National Do Not Call Registry is a popular federal program for the public to reduce the number of unwanted sales calls,” said Acting Assistant Attorney General Chad A. Readler of the Justice Department’s Civil Division. “This case demonstrates the Department of Justice’s commitment to smart enforcement of consumer protection laws, and sends a clear message to businesses that they must comply with the Do Not Call rules.”

“The outcome of this case shows companies will pay a hefty price for violating consumers’ privacy with unwanted calls,” said Acting FTC Chairman Maureen K. Ohlhausen. “This is a great result for consumers, and I am grateful to FTC staff for their years of tenacious work investigating and developing this case. We and our Department of Justice and state partners will continue to bring enforcement actions against Do Not Call violators.”

The United States was represented by Trial Attorneys Lisa K. Hsiao, Patrick Runkle, Sang Lee and Daniel Crane-Hirsch of the Justice Department’s Consumer Protection Branch. FTC attorneys Russell Deitch and Gary Ivens were agency counsel on the matter.

For more information about the Consumer Protection Branch and its enforcement efforts, visit its website at http://www.justice.gov/civil/consumer-protection-branch.

The Justice Department today announced an agreement with the City of Des Plaines, Illinois, to resolve allegations that the City violated the Religious Land Use and Institutionalized Persons Act of 2000 (RLUIPA) when it denied a rezoning application to allow The Society of American Bosnians and Herzegovinans (SABAH), a Bosnian Muslim religious organization, to use a vacant building as a mosque.

The agreement resolves a lawsuit the Department filed in September 2015, after conducting an investigation into the City’s zoning and land use practices.  A separate agreement resolving a similar lawsuit brought by SABAH has also been reached. 

The United States’ complaint alleged that the City discriminated against SABAH on the basis of religion or religious denomination by treating land use applications by non-Muslim religious groups better than it treated SABAH’s on the basis of parking requirements and tax-exempt status, and that the City departed from its normal practices and procedures in the treatment and denial SAHAB’s request.  The United States also alleged that the City’s denial imposed a substantial burden on SABAH’s religious exercise without serving a compelling governmental interest using the least restrictive means and that the City treated SAHAH on less than equal terms with similarly situated nonreligious groups, including a school and cultural center. 

On February 26, 2017, the United States District Court for the Northern District of Illinois ruled that the United States’ claims should proceed to trial, and found that the City misapplied its zoning laws by imposing higher parking standards on SABAH than on non-Muslim religious groups, and that the City did not use the least restrictive means to address purported concerns it had with SABAH’s request. 

As part of the agreement, the City of Des Plaines will abide by RLUIPA in its determinations involving religious land use requests, and has agreed to provide training on the requirements of RLUIPA to its officials and employees, and to publicize its non-discrimination policies, among other remedial measures. 

“Religious freedom is a fundamental right that belongs to all persons and religious groups in the United States,” said Acting Assistant Attorney General Tom Wheeler of the Justice Department’s Civil Rights Division.  “The Department of Justice’s Civil Rights Division will remain vigilant in its enforcement of federal law protecting the rights of religious communities to build and use property for religious worship.”

“Religious freedom is a fundamental right, and we will not tolerate the unlawful use of zoning or land use restrictions to infringe on that right,” said Joel R. Levin, Acting U.S. Attorney of the Northern District of Illinois.  “The U.S. Attorney’s Office will continue to safeguard the rights of religious groups to establish houses of worship without fear of discriminatory zoning or land use practices.

RLUIPA prohibits discrimination on the basis of religion in land use and zoning decisions.  Persons who believe they have been subjected to such discrimination in land use or zoning decisions may contact the U.S. Department of Justice Civil Rights Division at (800) 896-7743 and, in the Northern District of Illinois, they may also call the Unite States Attorney’s Office of Civil Rights Hotline at (855) 281-3339.

An Ohio resident was convicted Friday by a federal jury sitting in Cincinnati, Ohio of conspiracy to commit wire fraud, wire fraud, bank fraud, evasion of employment taxes and failure to pay over employment taxes, announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division.

According to the evidence presented at trial, Fesum Ogbazion, 44, was the owner and CEO of ITS Financial LLC, which was the national franchisor of Instant Tax Service (ITS), a tax preparation business. Ogbazion founded ITS in 2004 and at one time it had more than 1,100 franchise locations throughout the United States.

From approximately January 2009 through 2012, Ogbazion conspired with others at ITS to generate loan and tax return preparation fees for ITS and its franchises by luring taxpayers into ITS franchises through a fraudulent nationwide advertising campaign. The ITS ads offered tax refund anticipation loans through an independent third party lender, despite the fact that ITS did not have such a lender to fund the promised loans. The evidence introduced at trial established that Ogbazion used the false advertising campaigns to entice customers into coming to ITS locations for a loan and then used their loan applications to prepare and file income tax returns – often without customers’ authorization. ITS charged its customers between $500 to $800 in tax preparation fees. Between 2006 and 2011, ITS collected more than $70 million in fees.

Ogbazion also failed to pay approximately $1.3 million in payroll taxes due from ITS and another business during four tax quarters in 2009 and 2010. Ogbazion evaded the Internal Revenue Service’s (IRS) attempts to collect the unpaid taxes by directing business revenue to nominee accounts, placing assets in the names of nominee entities and making false statements to an IRS revenue officer during the course of collection activity.

In 2013, ITS and Ogbazion were permanently barred from operating or being involved with any work or business relating to the preparation of tax returns.

Sentencing will be set at a later date. Ogbazion faces a statutory maximum sentence of 20 years in prison on the conspiracy count, 20 years in prison for the wire fraud counts, 30 years in prison for bank fraud, five years in prison for tax evasion and five years in prison for failure to pay over employment taxes. He also faces a period of supervised release, restitution and monetary penalties.

Acting Deputy Assistant Attorney General Goldberg commended special agents of IRS–Criminal Investigation, who conducted the investigation, and Senior Litigation Counsel Corey Smith, Trial Attorney Mark McDonald and Paralegal Specialist Tiffany Thompson of the Tax Division, and Paralegal Specialist Laura Strubbe of the U.S. Attorney’s Office for the Southern District of Ohio, who prosecuted the case. Acting Deputy Assistant Attorney General Goldberg also thanked the U.S. Attorney’s Office for the Southern District of Ohio for their assistance.

Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.

Five men, including two individuals who formerly worked at scam call centers in India, each pleaded guilty within the past two weeks for their respective roles in a massive telephone impersonation fraud and money laundering scheme perpetrated by India-based call centers.

Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, Acting U.S. Attorney Abe Martinez of the Southern District of Texas, Executive Associate Director Peter T. Edge of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI), Inspector General J. Russell George of the U.S. Treasury Inspector General for Tax Administration (TIGTA) and Inspector General John Roth of the U.S. Department of Homeland Security Office of Inspector General (DHS-OIG) made the announcement.

From May 26 to June 6, Rajubhai Patel, 32, an Indian national most recently residing in Willowbrook, Illinois; Viraj Patel, 33, an Indian national most recently residing in Anaheim, California; Dilipkumar Ambal Patel, 53, an Indian national most recently residing in Corona, California; and Fahad Ali, 25, a Pakistani national and permanent U.S. resident most recently residing in Dyer, Indiana, each pleaded guilty to money laundering conspiracy before U.S. District Court Judge David Hittner of the Southern District of Texas. Hardik Patel, 31, an Indian national most recently residing in Arlington Heights, Illinois, pleaded guilty to wire fraud conspiracy before the same court on June 2. Sentencing dates are pending for all five defendants.

According to admissions made in connection with the plea agreements, the five men and their co-conspirators perpetrated a complex scheme in which individuals from call centers located in Ahmedabad, India, impersonated officials from the IRS and U.S. Citizenship and Immigration Services (USCIS), and engaged in other telephone call scams, in a ruse designed to defraud victims in the U.S. Using information obtained from data brokers and other sources, call center operators targeted U.S. victims, who were threatened with arrest, imprisonment, fines or deportation if they did not pay alleged monies owed to the government. Victims who agreed to pay the scammers were instructed how to provide payment, including by purchasing stored value cards or wiring money. Upon payment, the call centers would immediately turn to a network of “runners” based in the U.S. to liquidate and launder the fraudulently obtained funds.

Based on the statements in his June 2 guilty plea, beginning in August 2012, Hardik Patel owned and managed the day-to-day operations of an India-based scam call center before later leaving for the U.S. While in India, in his capacity as a manager, Hardik Patel communicated extensively via email, text, and other means with various India-based co-defendants to operate the scheme and exchange scripts used in the scheme, coordinate the processing of payments from scammed victims, obtain and exchange lead lists used by callers to target U.S. victims, and exchange spreadsheets containing the personal identifying information (PII) of U.S. persons misappropriated by the scammers to register reloadable cards used in the scheme. Hardik Patel also managed worker payroll and kept detailed records of profits and expenses for various associated scam call centers. Hardik Patel continued to communicate with India-based co-defendants about the scheme and assist with the conspiracy after he moved to the U.S. 

According to his June 6 guilty plea, Rajubhai Patel operated as a runner and assisted a co-defendant in managing the activities of a crew of other runners, based primarily out of Illinois, who liquidated victim funds in various locales in the U.S. for conspirators from India-based call centers. Rajubhai Patel communicated about the liquidation of scam funds via electronic WhatsApp communications with domestic and India-based co-defendants, purchased reloadable cards registered using the misappropriated PII of U.S. citizens that were later used to receive victims’ funds, and used those cards to purchase money orders and deposit them into various bank accounts of co-defendants and others as directed. Rajubhai Patel also admitted to creating and maintaining spreadsheets that detailed deposits, payments to co-conspirators, expenses and profits from the scheme.

According to admissions made in his June 2 guilty plea, Viraj Patel first became involved in the conspiracy between April and September 2013, prior to entering the U.S., when he worked at and assisted with overseeing the operations of a call center in India engaging in scam activity at the behest of a co-defendant. After entering the U.S., beginning in December 2014 Viraj Patel engaged in additional activities in support of the scheme in exchange for a cut of the profits, including serving as a processor of scam victim payments and as a runner engaging in the purchase and liquidation of cards loaded with victim scam funds. Viraj Patel communicated with various India-and U.S.-based co-defendants in furtherance of the conspiracy, and also obtained and circulated lead lists to his co-conspirators containing the PII of U.S. citizens for use by the call centers in targeting victims of the various fraud schemes and to register reloadable cards used to launder the proceeds of the schemes.  

Based on the admissions made in his May 26 guilty plea, since late 2013, Dilipkumar A. Patel operated as a runner in and around Southern California, along with other co-defendants based in the region. At the direction of India-based co-conspirators, often via electronic WhatsApp communications, Patel admitted to participating in the purchase of reloadable cards registered with the PII of U.S. citizens, and the subsequent liquidation of victim scam funds loaded to those cards by co-conspirators, while keeping a percentage of the victim funds on the cards for himself. 

According to his guilty plea, also on May 26, beginning in or around 2013, Fahad Ali worked as a member of a crew of runners operating in the Chicago, Illinois area, the Southern District of Texas and elsewhere throughout the country. Ali admitted that he first served as a driver for an Illinois-based co-defendant engaging in activities in furtherance of the conspiracy. Ali later operated at the direction of that co-defendant and others, via various means of communication, including text messages, to purchase reloadable cards, and then liquidate victim scam proceeds placed on those cards by India-based co-conspirators, in exchange for recurring payments. Ali also admitted to using false identification documents to receive wire transfers from victims of the fraud.

To date, Hardik Patel, Rajubhai Patel, Viraj Patel, Dilipkumar A. Patel, Fahad Ali, 51 other individuals and five India-based call centers have been charged for their roles in the fraud and money laundering scheme in an indictment returned by a federal grand jury in the Southern District of Texas on Oct. 19, 2016. Including the most recent pleas, a total of nine defendants have pleaded guilty thus far in this case. Co-defendants Bharatkumar Patel, Ashvinbhai Chaudhari, Harsh Patel and Nilam Parikh previously pleaded guilty on April 13; April 26; May 11; and May 18, respectively.

The remaining defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

HSI, DHS-OIG and TIGTA led the investigation of this case. Also providing significant support were: the Criminal Division’s Office of International Affairs; Ft. Bend County, Texas, Sheriff’s Office; police departments in Hoffman Estates and Naperville, Illinois, and in Leonia, New Jersey; San Diego County District Attorney’s Office Family Protection and Elder Abuse Unit; U.S. Secret Service; U.S. Small Business Administration, Office of Inspector General; IOC-2; INTERPOL Washington; USCIS; U.S. State Department’s Diplomatic Security Service; and U.S. Attorneys’ Offices in Northern District of Alabama, District of Arizona, Central District of California, Northern District of California, District of Colorado, Northern District of Florida, Middle District of Florida, Northern District of Illinois, Northern District of Indiana, District of Nevada and District of New Jersey. The Federal Communications Commission’s Enforcement Bureau also provided assistance in TIGTA’s investigation.

Senior Trial Attorney Michael Sheckels and Trial Attorney Mona Sahaf of the Criminal Division’s Human Rights and Special Prosecutions Section, Trial Attorney Robert Stapleton of the Criminal Division’s Money Laundering and Asset Recovery Section and Assistant U.S. Attorneys S. Mark McIntyre and Craig M. Feazel of the Southern District of Texas are prosecuting the case.

A Department of Justice website has been established to provide information about the case to already identified and potential victims and the public. Anyone who believes they may be a victim of fraud or identity theft in relation to this investigation or other telefraud scam phone calls may contact the Federal Trade Commission (FTC) via this website.

Anyone who wants additional information about telefraud scams generally, or preventing identity theft or fraudulent use of their identity information, may obtain helpful information on the IRS tax scams website, the FTC phone scam website and the FTC identity theft website.

A federal jury today convicted three real estate investors for their roles in a conspiracy to rig bids at public real estate foreclosure auctions held in Northern California, the Department of Justice announced.

After a three-week trial, the jury convicted Michael Marr, Javier Sanchez, and Gregory Casorso, on all counts. Marr, Sanchez, and Casorso were convicted for conspiring to rig bids at foreclosure auctions in Alameda County, California, between June 2008 and January 2011. Marr and Sanchez were also convicted on charges of conspiring to rig bids at foreclosure auctions in Contra Costa County, California between July 2008 and January 2011. The three defendants were charged in an indictment returned by a federal grand jury in the Northern District of California on Nov. 19, 2014.

The evidence at trial showed that the defendants conspired with others to rig bids to obtain hundreds of properties sold at foreclosure auctions. The conspirators designated the winning bidders to obtain selected properties at the public auctions, and negotiated payoffs among themselves in return for not competing. They then held second, private auctions at or near the courthouse steps where the public auctions were held, awarding the properties to conspirators who submitted the highest bids.

Including today’s convictions, 68 individuals have pleaded guilty or been convicted after trial as a result of the department’s ongoing antitrust investigations into bid rigging at public foreclosure auctions in Northern California. Indictments are pending against other real estate investors who participated in the conspiracy.

The investigation is being conducted by the Antitrust Division’s San Francisco Office and the FBI’s San Francisco Office. Anyone with information concerning bid rigging at real estate foreclosure auctions should contact the Antitrust Division’s San Francisco Office at 415-934-5300 or call the FBI tip line at 415-553-7400.

One member and two associates of the Wildboys gang were sentenced today in federal court in Charleston, South Carolina, after each pleaded guilty to attempted murder in aid of racketeering for their roles in retaliation attacks against a rival gang.

The announcement was made by Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, Special Agent in Charge C.J. Hyman of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) Charlotte, North Carolina Field Division; Solicitor Duffie Stone of the 14th Judicial Circuit; Solicitor David Pascoe of the First Circuit; Sheriff R.A. Strickland of the Colleton County, South Carolina Sheriff’s Office; Chief Wade Marvin of the Walterboro, South Carolina Police Department; Sheriff Al Cannon, Jr. of the Charleston County, South Carolina Sheriff’s Office; Sheriff L. C. Knight of the Dorchester County, South Carolina Sheriff’s Office; Chief Jon Rogers of the Summerville, South Carolina Police Department; Director Jerry B. Adger of the South Carolina Department of Probation, Parole and Pardon Services; and Chief Mark Keel of the South Carolina Law Enforcement Division.

U.S. District Court Judge Richard M. Gergel sentenced Brian Manigo, aka “B-Nasty,” of Green Pond, South Carolina, to 10 years in prison; Damien Robinson, aka “Sacked Up,” also of Green Pond, South Carolina, to 10 years in prison; and Kelvin Mitchell, aka “Kevy Boy,”of Ruffin, South Carolina, to 39 months in prison, after each pleaded guilty to attempted murder in aid of racketeering.

According to court documents, all three defendants were members or associates of the Wildboys gang, a violent street gang that originated in the Green Pond area of Walterboro, South Carolina. From 2009 to 2015, Wildboys gang members used Facebook and YouTube to communicate with each other; threaten rival gang members and the police; flaunt gang colors, tattoos, and hand signs; and post photographs and videos depicting firearms, large amounts of cash, and what purported to be controlled substances.  Gang members also engaged in violent criminal activities, including robberies of convenience stores, attempted murders of rival gang members, and narcotics trafficking. The Wildboys gang was also, for a time, aligned with another violent street gang called the “Cowboys” that originated out of the Brittlebank, or Eastside, area of Walterboro, South Carolina. In addition to sharing a common interest in posting threats and photographs depicting firearms, large amounts of cash, and what purported to be narcotics on Facebook and YouTube, the Wildboys and the Cowboys gangs shared common enemies. These shared interests resulted in shootings aimed at rival gang members, which left innocent by-standers seriously injured.

Manigo and Mitchell were sentenced for their roles in a May 14, 2011, retaliation shooting aimed at a rival gang member. While Mitchell drove the vehicle, Manigo retrieved an AK-47 rifle from the trunk of the car and fired multiple shots at the gang member who was standing in a crowd of individuals. An innocent by-stander sustained serious bodily injury as a result of the shooting.

Robinson was sentenced for his role in the April 7, 2015, retaliation drive-by shooting aimed at members of a rival gang. Robinson was the driver of the vehicle containing two other members of the Wildboys gang. As Robinson drove past the residence of the known rival gang members, the two passengers fired multiple shots at the home using an AR-15 and an SKS rifle. Robinson gave the AR-15, which belonged to him, to his fellow gang member to use during the shooting. The shooting resulted in serious bodily injury to an innocent victim inside the residence.

As part of the sentence, Manigo, Mitchell and Robinson were ordered to serve a term of three years of supervised release and to pay the costs of medical care for the victims.

A fourth member of the Wildboys, Joshua Manigault, who pleaded guilty to the April 7, 2015, shooting, has yet to be sentenced.

Devin Brown, who was also charged in the indictment, is scheduled for a jury trial to begin on June 26.  The charges against Brown contained in the indictment are merely accusations, and a defendant is presumed innocent unless and until proven guilty.

The case was investigated by the ATF in Charleston, South Carolina, in partnership with the Walterboro Police Department; Colleton County Sheriff’s Office; Charleston County Sheriff’s Office; Dorchester County Sheriff’s Office; Summerville Police Department; Fourteenth Judicial Circuit Solicitor’s Office; First Judicial Circuit Solicitor’s Office; South Carolina Department of Probation, Parole and Pardon Services; and the South Carolina Law Enforcement Division.

The case was prosecuted by Trial Attorney Leshia Lee-Dixon of the Criminal Division’s Organized Crime and Gang Section and Tameaka A. Legette, Special Assistant U.S. Attorney from the Fourteenth Judicial Circuit Solicitor’s Office, Bluffton, South Carolina.

A South Florida man was sentenced to prison in connection with the operation of a Jamaican-based fraudulent lottery scheme, the Department of Justice announced today.

Claude Shaw, 49, of Miramar, Florida, was sentenced to serve 36 months in prison and three years supervised release by U.S. District Court Judge William P. Dimitrouleas in Fort Lauderdale. Shaw was also ordered to pay $128,440 in restitution.

Shaw pleaded guilty on March 22, to one count of mail fraud in the Southern District of Florida. As part of his guilty plea, Shaw acknowledged that, from in or around September 2013, through in or around August 20l5, he participated in a scheme to defraud victims in the United States and unlawfully enrich himself.

“Today’s sentencing demonstrates the Justice Department’s commitment to combatting foreign-based lottery fraud schemes targeting individuals in the United States,” said Acting Assistant Attorney General Chad A. Readler of the Justice Department’s Civil Division. “Financial schemes designed to defraud unsuspecting victims will be prosecuted to the fullest extent of the law.”

As part of the scheme, victims throughout the United States received telephone calls in which they were falsely informed that they had won over $1 million in a lottery and needed to pay money in advance to claim their winnings. The victims were instructed on how, and to whom, to send their money, including being instructed to send their money to Shaw. Victims sent over $100,000 to Shaw, who then forwarded a portion of the money to Jamaica. Victims never received any lottery winnings.

“The Postal Inspection Service will continue to actively investigate fraudulent lottery schemes based in Jamaica directed at ripping off victims in the United States,” said Inspector in Charge Antonio J. Gomez of the U.S. Postal Inspection Service’s Miami, Florida Division. “Lottery scams tied to Jamaica are targeting victims in the United States, and we will not allow fraudsters to use the U.S. mail to commit their crime.”

This prosecution is part of the Department of Justice’s effort working with federal and local law enforcement to combat fraudulent lottery schemes preying on American citizens.

Acting Assistant Attorney General Readler commended the investigative efforts of the U.S. Postal Inspection Service. The case is being prosecuted by Trial Attorney Arturo DeCastro of the Civil Division’s Consumer Protection Branch.

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 Southern District of Florida, visit its website at https://www.justice.gov/usao-sdfl.

Eric Scott Kindley, 49, a prisoner-transport officer, was arrested yesterday in Stockton, California on charges related to sexually assaulting females in his custody, and threatening them with a firearm while doing so. During his initial appearance today, a federal judge in Sacramento, California ordered that Kindley be detained over the weekend, pending potential transport to Phoenix, Arizona, from where the complaint was issued.

According to the complaint and probable cause affidavit, Kindley operates Special Operations Group 6, a company that contracts with local jails throughout the country to transport individuals who have been arrested on out-of-state warrants. The probable cause affidavit alleges that from January through May of this year, Kindley engaged in sexual misconduct in his Dodge Caravan with three different female prisoners during three different transports. The transports were from California to Arizona, Alabama to Arizona, and Mississippi to New Mexico. In each instance, the victim was handcuffed and restrained, and taken to secluded locations where Kindley sexually assaulted her. All the while, Kindley threatened each victim with his firearm and warned them that he will get away with his conduct because no one will believe them.

The probable cause affidavit further alleges that during the transports, Kindley bragged to the victims about sexually assaulting other female prisoners during prior transports.

A complaint is only an allegation, and Kindley is presumed innocent unless proven guilty.

This investigation remains ongoing. Anyone with additional information is encouraged to call the Phoenix Division of the FBI at (623) 466-1999, or can email the Civil Rights Division at the Department of Justice at Prisoner.Transfer@usdoj.gov.

This case is being investigated by the Phoenix Division of the Federal Bureau Investigation and is being prosecuted by Special Litigation Counsel Fara Gold and Trial Attorney Maura White of the Criminal Section of the Civil Rights Division of the U.S. Department of Justice and Assistant United States Attorney Abbie Broughton Marsh of District of Arizona.

Deonte Pate, 24, was sentenced to 5 years of probation with 12 weeks of weekend confinement for conspiring to cover up the beating of an inmate identified by his initials, K.H. Pate acknowledged that he submitted false reports and lied to the FBI in order to prevent knowledge of the beating from reaching outside authorities. Romander Nelson, 44, was sentenced to 5 years of probation, 14 weeks of weekend confinement, and a $500 fine for failing to protect the victim during the beating.

The victim, was temporarily blinded by the attack and suffered severe blood loss, a broken orbital bone, and permanent partial vision loss.

Pate and Nelson were charged in 2016 along with two other officers: Lawardrick Marsher, 28, and Robert Sturdivant, 47. All four were officers at Mississippi State Penitentiary, in Parchman, Mississippi.

Marsher has pleaded guilty to carrying out the assault; Sturdivant, a supervisor, has pleaded guilty to conspiring to cover the assault up. Marsher and Sturdivant are scheduled to be sentenced on June 15 for their roles in the crime.

“Every corrections officer owes a duty of honesty and integrity to the individuals under his or her protection,” said Acting Assistant Attorney General Tom Wheeler. “The Department of Justice is committed to ensuring the rights of all citizens, including those in our nation’s jails and prisons.”

"The FBI's mission is to protect the American people and uphold the constitution of the United States," said Christopher Freeze, Special Agent in Charge of the FBI in Mississippi. "This protection extends to those serving time for various offenses in jails and prisons throughout the United States. The constitution provides no protection to those hiding behind a correctional officer uniform and abusing the authority given to them. The FBI will continue to aggressively investigate any allegations of civil rights violations."

This case was investigated by the FBI’s Jackson Division, with the cooperation of the Mississippi Department of Corrections. It was prosecuted by Assistant U.S. Attorney Robert Coleman of the Northern District of Mississippi and Trial Attorney Dana Mulhauser of the Civil Rights Division’s Criminal Section.

The Justice Department today announced a settlement with the city of Jacksonville, Florida, to resolve allegations that the city violated the Fair Housing Act and the Americans with Disabilities Act when it refused to all ow the development of permanent supportive housing for individuals with disabilities in its Springfield neighborhood.

The settlement, which must still be approved by the U.S. District Court for the Middle District of Florida, resolves a lawsuit the department filed in December 2016. That lawsuit was consolidated with similar ones brought by Ability Housing, Inc. and Disability Rights Florida, which were resolved in a separate settlement with the city.

“Federal law protects the right of individuals with disabilities to live in communities of their choice without facing discrimination,” said Acting Assistant Attorney General Tom Wheeler of the Justice Department’s Civil Rights Division. “Through this settlement, the city of Jacksonville has taken steps to ensure that its residents can exercise this right.”

“The Fair Housing Act and the Americans with Disabilities Act protect against official adoption of community discrimination,” said Acting U.S. Attorney W. Stephen Muldrow, of the Middle District of Florida. “We commend the city of Jacksonville’s willingness to rectify its past actions, and we look forward to continuing to work with the city to ensure that individuals with disabilities in Jacksonville are afforded the same opportunities as those without disabilities.”

As part of the city’s settlement with the department, the city has amended its zoning code to better comply with federal anti-discrimination laws, including removing restrictions that apply to housing for persons with disabilities and implementing a reasonable accommodation policy. The city also agreed to rescind the written interpretation that prevented Ability Housing from providing the housing at issue, designate a fair housing compliance officer, provide Fair Housing Act and Americans with Disabilities Act training for city employees, and pay a civil penalty to the government of $25,000. In the separate settlement, the city agreed to pay $400,000 to Ability Housing and $25,000 to Disability Rights Florida, and to establish a $1.5 million grant to develop permanent supportive housing in the city for people with disabilities.

The department’s suit alleged that in 2014, Ability Housing received a $1.35 million grant from Florida to revitalize a 12-unit apartment building and create permanent supportive housing for “chronically homeless” individuals in Jacksonville who, by definition, have at least one disability. Ability Housing specifically intended to provide this housing to veterans and to connect them with optional support services. The city had previously certified that Ability Housing’s development of the property was consistent with the city’s zoning code but, as alleged in the department’s complaint, reversed itself in response to intense community pressure based on stereotypes about the disabilities of the expected residents. As a result, Ability Housing lost the grant and the property. The department conducted an independent investigation and subsequently filed this lawsuit.

Fighting illegal housing discrimination is a top priority of the Justice Department. The Fair Housing Act prohibits discrimination in housing on the basis of race, color, religion, sex, familial status, national origin, and disability. Title II of the Americans with Disabilities Act prohibits discrimination on the basis of disability by public entities. More information about the Civil Rights Division and the laws it enforces is available at www.justice.gov/crt. Individuals who believe that they may have been victims of housing discrimination can call the Justice Department at 1-800-896-7743, email the Justice Department at fairhousing@usdoj.gov or contact HUD at 1-800-669-9777.

The Department of Justice announced today that it has reached a settlement agreement with Pierce County Transportation Benefit Area Corporation of Pierce County, Washington. The settlement resolves allegations that Pierce Transit violated the employment rights of Washington Army National Guard Member Lieutenant Colonel C. Van Sawin guaranteed by the Uniformed Services Employment and Reemployment Rights Act. USERRA safeguards the rights of uniformed servicemembers to retain their civilian employment following absences due to military service obligations.

Pierce Transit, headquartered in Lakewood, Washington, is a municipal corporation and an operator of public transit in Pierce County, Washington, located south of Seattle. According to allegations brought by LTC Sawin, and independently investigated by the DOJ, Pierce Transit violated USERRA by failing to reemploy LTC Sawin in September 2016 after he returned from active duty military service. Pierce Transit worked cooperatively with DOJ during its investigation and worked to reach a settlement that addressed the USERRA violation found by the Department.

LTC Sawin is a United States Military Academy graduate, who served on active duty as a U.S. Army Battalion Maintenance Officer. LTC Sawin has also served as a reservist and, between 2005 and 2006, deployed to Iraq in support of Operation Iraqi Freedom. LTC Sawin was hired by Pierce Transit in 2007 and rose to become its Business Development Officer. In November 2015, LTC Sawin was activated to help lead the Washington National Guard’s earthquake readiness exercise, code named “Evergreen Tremor” – a weeklong exercise involving more than 1000 Washington National Guard soldiers and airmen across the state, as well as local, state and federal emergency response agencies. The drill took place in the Summer of 2016. Following the drill, LTC Sawin re-applied for his position in September 2016. Pierce Transit declined to re-employ LTC Sawin, stating that, while he was on active duty (in March 2016), it had laid him off following a reorganization that eliminated his position.

Under the terms of the settlement agreement, which is not an admission of liability by Pierce Transit, Pierce Transit must pay LTC Sawin $105,000 to compensate him for lost and/or reduced wages and benefits, and other damages. Additionally, the settlement seeks to reduce the likelihood of future USERRA violations by requiring Pierce Transit to adopt a USERRA policy, to provide training to its high-level officials and human resources staff on the USERRA rights and obligations of employers and covered employees, and to report allegations of violations of USERRA and certify its compliance therewith to the DOJ for a period of two years. Pierce Transit also agreed to resolve any dispute about the agreement in the United States District Court for the Western District of Washington.

“Failure to reemploy a person who leaves their job because of military deployment, service, or training is a violation of the law,” said Acting Assistant Attorney General Tom Wheeler of the Justice Department’s Civil Rights Division. “The Justice Department will ensure that service members like LTC Sawin, who was called away from his job in order to serve the country in the National Guard, can complete their military obligations without fear that by doing so, they will lose their civilian jobs.”

“We are fortunate to have many National Guard servicemen and women who live in western Washington who are prepared to sacrifice time with their families and civilian jobs to serve our country,” said U.S. Attorney Annette L. Hayes. “Our job in the United States Attorney’s Office is to protect the rights of these citizen soldiers and to hold accountable employers who fail to meet their duties under the law.”

Subject to certain conditions, USERRA requires employers to promptly reemploy returning service members in the positions they would have held had their employment been not interrupted by military service, or in a position of like seniority, status and pay. Following a referral from the Department of Labor, the United States Department of Justice is authorized to bring claims on behalf of the men and women of our nation’s Armed Forces and veterans to recover employment rights including back pay, benefits and injunctive relief.

The matter was investigated and resolved by Assistant U.S. Attorney and Civil Rights Program Coordinator, J. Michael Diaz and Assistant U.S. Attorney Sarah Morehead in the U.S. Attorney’s Office for the Western District of Washington, in collaboration with Andrew Braniff, USERRA/USAO Program Coordinator, in the Employment Litigation Section of the Civil Rights Division of the Justice Department.

The Justice Department’s Civil Rights Division have given a high priority to the enforcement of service members’ rights under USERRA. Additional information about USERRA can be found on the Justice Department’s websites at www.usdoj.gov/crt/emp and www.servicemembers.gov, as well as on the Labor Department’s website at www.dol.gov/vets/programs/userra/main.htm.

A Fort Lauderdale, Florida resident pleaded guilty today to tax evasion, announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division.

According to documents filed with the court, Thomas Daly, 53, admitted that he evaded paying taxes on more than $1.5 million in income that he earned from 2002 to 2015. Daly further admitted that, except for the 2007 tax year, he has not filed an income tax return since 2002. Daly worked for a Fort Lauderdale company selling hurricane-resistant windows to residential homeowners in South Florida. In August 2009, the Internal Revenue Service (IRS) notified Daly of its intent to levy his wages because of his failure to pay taxes. To obstruct the IRS’s collection efforts, Daly established his own business, South Florida Home Marketing Inc. (SFHM), and changed his employment status from an employee to an independent contractor. Daly listed himself as the director of SFHM and opened a business bank account in its name. Due to Daly’s change in employment status, his employer paid SFHM directly and the IRS’s attempts to levy Daly’s wages were thwarted.

From approximately August 2009 through April 2017, Daly used SFHM’s bank account to pay for personal expenses, including rent, cigars, international travel, entertainment, his girlfriend’s cosmetic surgery, jewelry and a boat. He also falsely classified numerous personal expenses as business expenses on the memo line of the checks drawn on the SFHM bank account. Daly admitted that he made these false entries with the intent to claim false business expense deductions and evade the assessment of his income taxes. Daly admitted that his actions caused a tax loss of more than $351,241.

Sentencing is scheduled for Aug. 18. Daly faces a statutory maximum sentence of five years in prison, a period of supervised release, restitution and monetary penalties.

Acting Deputy Assistant Attorney General Goldberg commended special agents of IRS–Criminal Investigation, who conducted the investigation, and Trial Attorneys Charles M. Edgar, Jr. and Michael C. Boteler of the Tax Division, who are prosecuting the case with assistance from the U.S. Attorney’s Office for the Southern District of Florida.

Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.

The Justice Department today announced a settlement with the City of Jackson, Mississippi to resolve allegations that the city violated the Fair Housing Act (FHA) and the Americans with Disabilities Act (ADA) by preventing people in recovery from alcohol and substance abuse from living in group homes in most residential areas.

The settlement, which must still be approved by the U.S. District Court for the Southern District of Mississippi, resolves a lawsuit the department filed in September 2016.

The United States alleged that the City of Jackson engaged in a pattern or practice of discrimination on the basis of disability by imposing unlawful zoning restrictions on group homes for persons in recovery. The city enforced those restrictions against a group home operated by Urban Rehab, Inc., resulting in an order requiring the home to close and the residents to relocate. Several other homes for persons in recovery were at risk of being closed by the city’s enforcement of its ordinance.

As part of the settlement, the city agreed to revise its zoning code to permit persons in recovery to reside in all residential zones and to ease other restrictions on group homes for people with disabilities. The city has agreed to adopt a reasonable accommodation policy, train city employees on the requirements of the FHA and ADA, appoint a Fair Housing Compliance Officer, and report periodically to the Justice Department. The city will pay $100,000 to the owner of Urban Rehab, Inc., $35,000 to the department as a civil penalty, and $50,000 to a settlement fund that will compensate other victims.

“Federal law prohibits housing discrimination against people because of their disabilities,” said Acting Assistant Attorney General Tom Wheeler of the Justice Department’s Civil Rights Division. “This settlement is an important commitment by the City of Jackson to bring its zoning code in line with both the Fair Housing Act and the Americans with Disabilities Act.”

The case was handled by the department’s Civil Rights Division and the U.S. Attorney’s Office of the Southern District of Mississippi.

The Fair Housing Act prohibits discrimination in housing based on race, color, religion, national origin, sex, disability and familial status. More information about the Civil Rights Division and the laws it enforces is available at www.justice.gov/crt. Persons who believe that they have experienced unlawful housing discrimination may contact the Justice Department at 1-800-896-7743, or by e-mail at fairhousing@usdoj.gov.

Former Puerto Rico Senator Hector Martinez Maldonado and Juan Bravo Fernandez, the former president of one of the largest private security companies in Puerto Rico, were convicted of bribery following a four-week trial in San Juan, Puerto Rico, announced Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division.

Martinez Maldonado, 48, of Carolina, Puerto Rico, and Bravo Fernandez, 62, of San Juan, were each convicted on May 31, 2017, of federal program bribery.

According to evidence presented at trial, Martinez Maldonado was elected to the Puerto Rico Senate in 2004 and began serving a four-year term in January 2005. He was reelected in 2008. Beginning in 2005, Martinez Maldonado served as Chairman of the Puerto Rico Public Safety Committee, exercising significant control over legislation related to security and community safety. Bravo Fernandez was the president and chief executive officer of Ranger American, one of the largest private security firms in Puerto Rico.

The jury convicted the defendants for their role in a bribery scheme in which Bravo Fernandez provided Martinez Maldonado and Jorge de Castro Font, another former Puerto Rico senator, with a trip to Las Vegas to watch a championship boxing match between Winky Wright and Felix “Tito” Trinidad, a legendary Puerto Rican boxer, in exchange for the senators’ help with legislation favorable to Bravo Fernandez’s business interests.

Documents and evidence presented at trial showed that the trip to Las Vegas included first-class airfare; hotel rooms at the Mandalay Bay Resort and Casino; $1,000 tickets to the Trinidad vs. Wright boxing match; and meals, drinks and hotel rooms in Miami for the return trip. On March 2, 2005, the day that Bravo Fernandez paid for the boxing tickets, Martinez Maldonado submitted one of the bills favorable to Bravo Fernandez for consideration by the Puerto Rico Senate. The evidence at trial also showed that the hotel reservation was made the day after Martinez Maldonado presided over a Public Safety Committee hearing for one of the bills, and that, the day after the three men returned from their trip to Las Vegas, Martinez Maldonado and de Castro Font both cast their vote in support of one of Bravo Fernandez’s bills in the Senate.

De Castro Font served in the Puerto Rico House of Representatives from 1989 to 2004, and served in the Puerto Rico Senate from 2005 to 2008. De Castro Font pleaded guilty on Jan. 21, 2009, to 20 counts of honest services wire fraud and one count of conspiracy to commit extortion. He was sentenced on May 17, 2011, to 60 months in prison.

The case is being prosecuted by Deputy Chief Peter Koski and Trial Attorneys Monique Abrishami and Gwendolyn Stamper of the Criminal Division’s Public Integrity Section. The case is being investigated by the FBI’s San Juan Office.

Eric J. Thompson, 29, of Jacksonville, N.C., was sentenced today to 15 years in prison and ordered to pay $19,200 in restitution after pleading guilty on November 9, 2016, to one count of interstate transportation for prostitution and one count of using an interstate facility to promote a prostitution business enterprise. Acting Assistant Attorney General Tom Wheeler of the Justice Department’s Civil Rights Division, U.S. Attorney John Stuart Bruce of the Eastern District of North Carolina, and Special Agent in Charge Nick Anan of ICE Homeland Security Investigations Atlanta announced the sentence.

According to documents filed in the case and admissions in connection with the guilty plea, Thompson operated an interstate prostitution business enterprise in North Carolina and South Carolina. He used false promises of money and fame to recruit and entice five women to prostitute for his profit, and then used a scheme involving isolation, threats, and abuse to compel them to continue prostituting. Thompson further filmed himself performing sexual acts with the women and posted those videos online for sale without the victims’ consent.

“Human tracking is a heinous violation of an individual’s rights and freedoms, and today’s sentence sends a clear message that the Department of Justice will work tirelessly on behalf of human trafficking victims in order to stop this appalling criminal activity,” said Acting Assistant Attorney General Tom Wheeler of the Justice Department’s Civil Rights Division. “We are grateful for our law enforcement partners and U.S. Attorney Bruce as we combat and dismantle human trafficking networks.”

“Our office was pleased to partner with the Civil Rights Division’s Human Trafficking Prosecutions Unit, ICE Homeland Security Investigations Atlanta, and the Raleigh Police Department in this important case. This prosecution gave the victims of this horrific human trafficking crime a voice and an opportunity to seek justice,” said United States Attorney John Stuart Bruce.

“Human trafficking is quite simply, a form of modern-day slavery, and the threats and abuse inflicted on these particular victims only adds to the heinous nature of the crime,” said Special Agent in Charge of ICE Homeland Security Investigations Atlanta Nick Annan. “HSI made a record number of more than 2,000 human trafficking arrests in 2016 and rescued more than 400 trafficking victims nationwide, with many of them often hidden in plain sight. HSI will continue our relentless pursuit to investigate and seek prosecution of criminal traffickers while ensuring the victims of this terrible crime are rescued and get the care they need.”

Thompson was indicted on March 16, 2016, and charged with one count of sex trafficking, five counts of interstate transportation for prostitution, one count of using an interstate facility to promote a prostitution business enterprise, and one count of failing to maintain records related to individuals depicted in videos of sexually explicit conduct. A second defendant, Dequann Ross, was charged by information and pleaded guilty on August 9, 2016 to one count of using an interstate facility to promote a prostitution business enterprise for his role in aiding and abetting Thompson. He was sentenced on February 2, 2017, to 30 months in prison.

The case was jointly investigated by ICE Homeland Security Investigation’s Atlanta Division and the Raleigh Police Department. The case is being prosecuted by Assistant U.S. Attorneys Erin Blondel and Eleanor Morales of the Eastern District of North Carolina and Trial Attorney Vasantha Rao of the Civil Rights Division’s Human Trafficking Prosecution Unit.

The Justice Department today announced an agreement with Bernards Township, New Jersey, to resolve allegations that the Township violated the Religious Land Use and Institutionalized Persons Act of 2000 (RLUIPA) when it denied zoning approval to allow the Islamic Society of Basking Ridge to build a mosque. The agreement also resolves allegations that, while the zoning application was pending, the Township revised its zoning code to unreasonably limit any house of worship from building in the Township.

The agreement resolves a lawsuit the Department filed in November 2016, after the Islamic Society applied to build on property owned that permitted places of worship as-of-right. A separate agreement resolving a similar lawsuit brought by the Islamic Society against Bernards Township has also been reached.

The United States’ complaint alleged that Bernards Township discriminated against the Islamic Society based on its religion and the religion of its members when it denied the zoning application; applied standards and procedures on the Islamic Society that it had not applied to other religious and non-religious assemblies in the past; and imposed a substantial burden on the Islamic Society’s religious exercise. The United States also alleged that Bernards Township’s revised zoning code imposes unreasonable limitations on all religious assemblies in the Township, in violation of RLUIPA.

As part of the agreement, Bernards Township will permit the Islamic Society to build the mosque. The Township also has agreed to provide training on the requirements of RLUIPA to its officials and employees and publicize its non-discrimination policies, among other remedial measures. Additionally, the Township will amend its zoning ordinance to limit the zoning restrictions placed on houses of worship. In a separate agreement between the Islamic Society and the Township, the Township agreed to pay $3.25 million in damages and attorney’s fees.

“Federal law protects people of all religious communities from discrimination and unlawful obstacles when they seek to build a place of worship," said Acting Assistant Attorney General Tom Wheeler of the Justice Department's Civil Rights Division. "Through this agreement, the Islamic Society of Basking Ridge and its members will be able to build a mosque and exercise the fundamental American right of freedom of worship.”

“Federal law requires towns to treat religious land use applications like any other land use application,” said Acting U.S. Attorney William E. Fitzpatrick of the District of New Jersey. “Bernards Township made decisions that treated the Islamic Society of Basking Ridge differently than other houses of worship. The settlement announced today corrects those decisions and ensures that members of this religious community have the same ability to practice their faith as all other religions.”

RLUIPA prohibits discrimination in land use and zoning decisions. Persons who believe they have been subjected to discrimination in land use or zoning decisions may contact the U.S. Attorney’s Office Civil Rights Hotline at (855) 281-3339 or the Civil Rights Division Housing and Civil Enforcement Section at (800) 896-7743.

WASHINGTON – Attorney General Jeff Sessions has selected James McHenry as the acting Director of the Executive Office for Immigration Review (EOIR).

“I am pleased James McHenry has agreed to lead the Executive Office for Immigration Review, and the Justice Department is fortunate to have him act as the agency’s director,” said Attorney General Sessions. “His experience will serve the department well as EOIR works to reduce the immigration court backlog and to ensure that the law is applied in a fair and efficient manner in immigration proceedings.”

Acting Director McHenry has previously served in the Executive Office for Immigration Review; he first joined the agency in 2003 through the Attorney General’s Honors Program and returned to the agency in 2016, when he was appointed as an administrative law judge (ALJ) for EOIR’s Office of the Chief Administrative Hearing Officer (OCAHO).

Earlier this year, McHenry served as a Deputy Associate Attorney General working on a variety of immigration-related litigation matters and overseeing multiple components reporting to the Office of the Associate Attorney General. From 2014 to 2016, he served as an ALJ for the Office of Disability Adjudication and Review in the Social Security Administration. Prior to that, he worked for the Office of the Principal Legal Advisor (OPLA), Immigration and Customs Enforcement (ICE), Department of Homeland Security (DHS) as an Assistant Chief Counsel and, later, as a Senior Attorney where he served as a lead attorney for national security, denaturalization, and gang cases, anti-human trafficking operations, and worksite enforcement matters. He also served a detail as a Special Assistant United States Attorney for the Criminal Division, U.S. Attorney’s Office, Northern District of Georgia.

Acting Director McHenry earned a Bachelor of Science from the Georgetown University School of Foreign Service, a Master of Arts in political science from the Vanderbilt University Graduate School, and a Juris Doctor from the Vanderbilt University Law School.

On Memorial Day, our nation unites in remembrance of the men and women of the U. S. Armed Forces who gave their lives to defend our freedoms.  We share our prayers and sympathies with their families and loved ones, recognizing with gratitude that when our nation called, these brave heroes answered with their lives.

The Attorney General, and personnel throughout the Department of Justice, will observe the National Moment of Remembrance on Memorial Day, May 29, at 3 p.m.  The National Moment of Remembrance, which was established by Congress in 2000, encourages all American citizens, including federal agency personnel, to pause for one minute to remember the men and women who lost their lives fighting for our nation and its values of freedom and peace.  Every day, the Department of Justice pays tribute to the servicemembers who made the ultimate sacrifice.  Memorial Day provides a special opportunity to reflect on the magnitude of that sacrifice. 

Those who have fallen in defense of our country have earned an honor that must be recognized by both our words and deeds.  Through its Servicemembers and Veterans Initiative, the Department of Justice is working tirelessly to ensure that all members of our military receive the legal and constitutional protections that they have fought so hard – and so valiantly – to help secure.  They deserve the best that we have to give, because they have given the best of themselves.  This Memorial Day, please join us at the Department of Justice to, as Abraham Lincoln stated at Gettysburg, dedicate ourselves to “the great task remaining before us—that from these honored dead we take increased devotion to that cause for which they gave the last full measure of devotion.”

A resident of College Station, Texas, pleaded guilty today to conspiring to defraud the United States by using offshore accounts in Panama to conceal more than $1.3 million in royalty income that she earned from oil wells, announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division.

According to documents and information provided to the court, Joyce Meads, 73, admitted that she filed false 1997 through 2009 individual income tax returns, omitting more than $1.3 million in royalty income that she received from oil wells. From approximately April 1997 through April 2010, she conspired with offshore promoters to disguise this income, setting up nominee companies in Delaware and Panama in the name of W.G. Holdings Corporation and transferring her interest in the oil wells to the nominee entity in Delaware. Meads’s monthly royalty checks were issued to W.G. Holdings. For approximately a decade, Meads had her royalty checks sent to a Miami post office box where they were picked up, couriered to Panama and deposited into her nominee accounts. Meads repatriated funds by disguising them as scholarships or loans from W.G. Holdings to herself. She later transferred the funds to bank accounts in her own name or her mother’s name. Meads admitted that she caused a tax loss of more than $250,000. Two of the promoters who assisted Meads, Marc Harris of The Harris Organization, Republic of Panama, and Boyce Griffin of Offshore Management Alliance Ltd., Republic of Panama, have also been convicted of conspiracy and other charges and were previously sentenced to prison.

“For more than a decade, Joyce Meads attempted to conceal her income from the Internal Revenue Service (IRS) by assigning it to a nominee entity and stashing it offshore,” said Acting Deputy Assistant Attorney General Goldberg. “As today’s plea makes clear – the days of safely hiding your money offshore are over – the Department continues to work with its law enforcement partners to find and hold accountable those who seek to evade paying their fair share of taxes.”

“Joyce Meads’ attempt to use complex offshore schemes to evade paying her fair share of income taxes was no match for the skills of IRS Criminal Investigation special agents,” said Chief Richard Weber of IRS Criminal Investigation (CI). “IRS CI and the Department of Justice’s Tax Division share the same vision when it comes to investigating those who attempt to hide their income; whether it’s through offshore holdings or state-side entities, we are determined to put an end to this type of fraudulent activity.”

Sentencing is scheduled for Aug. 4. Meads faces a statutory maximum sentence of five years in prison, a period of supervised release, restitution and monetary penalties.

Acting Deputy Assistant Attorney General Goldberg commended special agents of IRS–Criminal Investigation, who conducted the investigation, and Assistant Chief Greg Tortella of the Tax Division, who is prosecuting the case.

Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.

          Today, SHAWN N. ANDERSON, Acting United States Attorney for the Districts of Guam and the Northern Mariana Islands (NMI), announced that defendant QIRAN LI, age 31, from Susupe, Saipan, was sentenced in District Court to an 18-month term of imprisonment, to be followed by two years of supervised release, and 50 hours of community service, for Distribution of a Controlled Substance (Methamphetamine). The Court also ordered LI to pay a mandatory $100 assessment fee. In addition, defendants convicted of a federal drug offense may no longer qualify for certain federal benefits.

          On December 2, 2016, LI was charged by Indictment with Distribution of a Controlled Substance (Methamphetamine), in violation of 21 U.S.C. §§ 841(a)(1) and (b)(1)(C). He entered a guilty plea to the charge on January 27, 2017. During the course of the underlying investigation, LI sold methamphetamine to a confidential informant on two separate occasions in March of 2016, and law enforcement was able to seize a total of 9.7 grams with a 98 percent purity level.

          The investigation was conducted by the Drug Enforcement Administration, with the assistance of Task Force Officers from CNMI Customs and the CNMI Department of Public Safety. The case was prosecuted by Garth Backe, Assistant United States Attorney for the District of the NMI.

          Today, SHAWN N. ANDERSON, Acting United States Attorney for the Districts of Guam and the Northern Mariana Islands (NMI), announced that defendant JINGBO CHEN, also known as Jingbo San Nicolas or “Kim,” age 43, of Navy Hill, Saipan, was sentenced in District Court to a thirty (30) day term of imprisonment, to be followed by one year of supervised release, for Entering a Secure Area at an Airport by False Pretenses. The Court also ordered CHEN to pay a $2,000 fine and a mandatory $100 assessment fee.

          On August 5, 2016, CHEN was charged by Indictment with Removing Goods from Customs Custody, in violation of 18 U.S.C. § 549, and Entering a Secure Area at an Airport by False Pretenses, in violation of 18 U.S.C. §§ 1036(a)(4) and (b)(1). She entered a guilty plea to an Information charging her with one count of Entering a Secure Area at an Airport by False Pretenses on October 6, 2016. The investigation revealed that CHEN, then an Airport Service Agent for Pacific Oriental Inc. Aviation (POI), went to the Saipan International Airport in her uniform although it was her day off, and made a number of false statements to co-workers prior to entering a secure area of the airport. After entering the secure area, CHEN received a bag from an arriving passenger and took it with her through an access door before it could be inspected by CNMI Customs.

          The investigation was conducted by Department of Homeland Security, Homeland Security Investigations, with the assistance of Task Force Officers from CNMI Customs and the CNMI Department of Public Safety. The case was prosecuted by Garth Backe, Assistant United States Attorney for the District of the NMI.

WASHINGTON – Attorney General Jeff Sessions today issued the following statement on the recent leaks following the Manchester terror attack:

“I share the president's deep concern and talked to Home Secretary Rudd yesterday about this matter. These leaks cannot be tolerated and we will make every effort to put an end to it. We have already initiated appropriate steps to address these rampant leaks that undermine our national security.”

Attorney General Jeff Sessions today issued the following statement on the Fourth Circuit Court of Appeals Decision:

“President Trump’s executive order is well within his lawful authority to keep the Nation safe.”

“The Department of Justice strongly disagrees with the decision of the divided court, which blocks the President’s efforts to strengthen this country’s national security. As the dissenting judges explained, the executive order is a constitutional exercise of the President’s duty to protect our communities from terrorism. The President is not required to admit people from countries that sponsor or shelter terrorism, until he determines that they can be properly vetted and do not pose a security risk to the United States.”

“This Department of Justice will continue to vigorously defend the power and duty of the Executive Branch to protect the people of this country from danger, and will seek review of this case in the United States Supreme Court.”

On Wednesday, a federal court in Minneapolis, Minnesota ruled that Wells Fargo is liable for a 20 percent negligence penalty in connection with $350 million of foreign tax credits that it claimed based on its participation in an abusive tax shelter known as Structured Trust Advantaged Repackaged Securities (STARS). This follows a Minnesota jury’s verdict on Nov. 17, 2016, that ruled Wells Fargo was not entitled to those foreign tax credits because the transaction lacked both economic substance and a non-tax business purpose.

After a three-week trial, the jury in this case was asked to determine whether Wells Fargo’s STARS transaction had economic substance, and the jury made some key factual findings. Wells Fargo contended that STARS was a single, integrated transaction that resulted in low-cost funding, but the jury found that in reality, the transaction consisted of two economically distinct and independent transactions: a loan and a trust. The jury found that the trust structure had no reasonable potential for pretax profit and that Wells Fargo entered into the trust structure solely for tax reasons. The jury also found that Wells Fargo entered into the loan solely for tax-related reasons.

In a prior decision in this case, the court noted that Barclays Bank PLC marketed the STARS transaction to American banks, which was designed to exploit differences between the tax laws in the United States and in the United Kingdom. Three other courts have rejected STARS tax shelters that Bank of New York, BB&T Bank and Santander Bank purchased. Santander Holdings USA, Inc. v. United States, 844 F.3d 15 (1st Cir. 2016), pet. for cert. filed, March 20, 2017 (No. 16‐1130); Bank of N.Y. Mellon Corp. v. Comm’r, 801 F.3d 104 (2d Cir. 2015), cert. denied, 136 S. Ct. 1377 (2016); Salem Fin., Inc. v. United States, 786 F.3d 932 (Fed. Cir. 2015), cert. denied, 136 S. Ct. 1366 (2016).

“The jury verdict is a resounding message to companies trying to exploit an abusive transaction that no matter how sophisticated the scheme, these sham tax shelters will not stand,” said Acting Assistant Attorney General David A. Hubbert of the Justice Department’s Tax Division. “The Court’s opinion is equally clear that taxpayers who engage in such transactions can be subject to significant penalties.”

Acting Assistant Attorney General Hubbert thanked the agents and attorneys at the Internal Revenue Service who assisted the Justice Department, as well as Tax Division Chief Senior Litigation Counsel Dennis Donohue, Trial Attorneys William Farrior, Harris Phillips and Viki Economides, who litigated this case. Mr. Hubbert also thanked Paralegal Joanna Lara for her assistance on the case.

Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.

Deputy Attorney General Rod J. Rosenstein today recognized two law enforcement officers, two state-level task forces, and a private citizen for their efforts to recover missing and abducted children and investigate cases of sexual exploitation of children and child pornography.

The awards, coordinated by the Office of Juvenile Justice and Delinquency Prevention in the Office of Justice Programs, were presented during a formal ceremony at the Robert F. Kennedy Department of Justice Building.

“The people we recognize today remind us of our responsibility to protect all children from harm,” said Deputy Attorney General Rosenstein. “Their actions epitomize the values of courage, selflessness, and determination. The Department of Justice is proud to honor their inspirational achievements, and I am proud to stand with them.”

The ceremony included recognition of a student artist who best conveyed the theme “Bringing Our Missing Children Home.” Audrey Link, a fifth grader at Resurrection Catholic School in Lakeland, Fla., is this year’s national poster contest winner.

In addition to Link’s recognition, Rosenstein presented the following awards:

Attorney General’s Special Commendation: This commendation recognizes the extraordinary efforts of an Internet Crimes Against Children task force or affiliate agency for making significant investigative or program contributions. Recipients: The Alabama and Georgia Internet Crimes Against Children task forces launched a coordinated investigation into individuals suspected of possessing and distributing child pornography. The investigation spanned more than 70 law enforcement agencies across two states and resulted in 54 search warrants, 29 arrests and the seizure of 731 digital devices as evidence.

Missing Children’s Law Enforcement Award: This award recognizes the extraordinary efforts of a law enforcement officer who made a significant investigative or program contribution to the safety of children. Recipient: Special Agent Kathryn Gamble of the U.S. Department of Homeland Security, Homeland Security Investigations, Nogales, Ariz., initiated a global investigation targeting those who use the online chat service Kik to sexually exploit minors. Her efforts led to the execution of nearly 60 search and arrest warrants, identification of 30 child victims, the rescue of 22 child victims from ongoing sexual abuse, and the prosecution of five individuals to date.

Missing Children’s Child Protection Award: This award honors the extraordinary efforts of a law enforcement officer who made a significant investigative or program contribution to protect children from abuse or victimization. Recipient: Forensic Detective Eric Kjorness of the Idaho Internet Crimes Against Children task force, Moscow, Idaho, assisted in the investigation of 15 cases of possession or distribution of child pornography in 2016. Those 15 cases resulted in the examination of 40 electronic devices and the recovery of more than one million child pornography images and videos. Detective Kjorness also provides presentations to public schools, PTA groups, and civic groups to educate children, parents, and educators about child enticement via the Internet and online chat rooms.

Missing Children’s Citizen Award: This award honors the extraordinary effort of private citizens for their unselfish acts to safely recover missing or abducted children. Recipient: Springfield, Mo., bus driver T.J. Davis’s actions led to the recovery of a 13-year-old girl with autism who was reported missing in December 2016. While driving his route, Davis noticed a girl fitting the police description sitting in the lap of a man in a wheelchair. The man approached Davis’s bus, told him the girl needed help and left her with Davis, he then proceeded down the sidewalk. Recognizing him as a regular bus rider, Davis contacted his dispatcher and later described the man to authorities. Police arrested and charged the man with first-degree child kidnapping and enticement of a child.

President Ronald Reagan proclaimed May 25, 1983, the first National Missing Children’s Day in memory of Etan Patz, a six-year-old boy who disappeared from a New York City street corner on May 25, 1979. Missing Children’s Day honors his memory and the memories of children still missing. Although Patz’ killer was convicted this February for the 1979 murder, Etan Patz remains missing and his case active with the National Center for Missing and Exploited Children because his remains were never found.

Additional information is available online about National Missing Children’s Day.

The Office of Justice Programs, headed by Acting Assistant Attorney General Alan R. Hanson, provides federal leadership in developing the nation’s capacity to prevent and control crime, administer justice and assist victims. OJP has six bureaus and offices: the Bureau of Justice Assistance; the Bureau of Justice Statistics; the National Institute of Justice; the Office of Juvenile Justice and Delinquency Prevention; the Office for Victims of Crime; and the Office of Sex Offender Sentencing, Monitoring, Apprehending, Registering and Tracking (SMART). More information about OJP and its components can be found at www.ojp.gov.

The Department of Justice, on behalf of the Environmental Protection Agency (EPA), today filed a civil complaint in federal court in Detroit, Michigan, against FCA US LLC, Fiat Chrysler Automobiles N.V., V.M. Motori S.p.A., and V.M. North America, Inc. (collectively referred to as FCA).  The complaint alleges that nearly 104,000 light duty diesel vehicles containing 3.0 liter EcoDiesel engines are equipped with software functions that were not disclosed to regulators during the certification application process, and that the vehicles contain defeat devices.  The complaint alleges that the undisclosed software functions cause the vehicles’ emission control systems to perform differently, and less effectively, during certain normal driving conditions than on federal emission tests, resulting in increased emissions of harmful air pollutants.

The Clean Air Act requires vehicle manufacturers to obtain a certificate of conformity before introducing a vehicle into commerce, by demonstrating to EPA that the vehicle will meet applicable federal emission standards to control air pollution.  Manufacturers must disclose in their certification applications all auxiliary emission control devices (e.g. computer software that affects the performance of emission controls based upon operating parameters of the vehicle), justify the presence of any such devices, and explain why those that reduce the effectiveness of emission controls are not “defeat devices.”  Motor vehicles equipped with defeat devices cannot be certified.

The complaint alleges that FCA equipped nearly 104,000 Ram 1500 and Jeep Grand Cherokee vehicles (Model Years 2014-2016) sold in the United States with at least eight software-based features that were not disclosed in FCA’s applications for certificates of conformity and that affect the vehicles’ emission control systems.  The undisclosed software features lessen the effectiveness of the vehicles’ emissions control systems during certain normal driving situations.  This results in cars that meet emission standards in the laboratory and during standard EPA testing, but during certain normal on-road driving emit oxides of nitrogen (NOx) that are much higher than the EPA-compliant level.  The complaint alleges that each of these vehicles differs materially from the specifications provided to EPA in the certification applications, and thus the cars are uncertified, in violation of the Clean Air Act.  These allegations are consistent with those set forth in notice of violation (“NOV”) that EPA issued to FCA US LLC and FCA NV on Jan. 12, 2017.

Following the issuance of the NOV, EPA continued its investigation into the operation of the undisclosed software-based features.  Based upon this investigation, the complaint alleges that one or more of these undisclosed software features, alone or in combination with the others, renders inoperative, bypasses and/or defeats the vehicles’ emission control systems, which were installed to make the vehicles comply with Clean Air Act emission standards.  In short, the complaint now alleges that the vehicles contain defeat devices.

NOx pollution contributes to the formation of harmful smog and soot, exposure to which is linked to a number of respiratory- and cardiovascular-related health effects as well as premature death. Children, older adults, people who are active outdoors (including outdoor workers), and people with heart or lung disease are particularly at risk for health effects related to smog or soot exposure. Nitrogen dioxide formed by NOx emissions can aggravate respiratory diseases, particularly asthma, and may also contribute to asthma development in children.

The civil complaint filed today seeks injunctive relief and the assessment of civil penalties.   The United States also filed a notice that it will request to transfer its case and fully participate in the pretrial proceedings now initiated in the related multi-district litigation in the Northern District of California. 

EPA and the California Air Resources Board are continuing in their discussions with FCA to bring the subject vehicles into compliance with the Clean Air Act and California law.  The nature and timing of any resolution of this issue are uncertain.

The Justice Department announced today that it has reached a settlement agreement with Carrillo Farm Labor, LLC (Carrillo Farm), an onion farm in Deming, New Mexico. The settlement resolves the department’s investigation of complaints that Carrillo Farm discriminated against U.S. citizens due to a hiring preference for foreign visa workers.

After investigating complaints filed on behalf of two U.S. citizens, the Justice Department determined that Carrillo Farm denied U.S. citizens employment in 2016 because it wanted to hire temporary foreign workers under the H-2A visa program. Under the anti-discrimination provision of the Immigration and Nationality Act (INA), it is unlawful for employers to intentionally discriminate against U.S. citizens because of their citizenship status.

The settlement agreement requires Carrillo Farm to pay civil penalties to the United States, undergo department-provided training on the anti-discrimination provision of the INA, and comply with departmental monitoring and reporting requirements. In a separate agreement with workers represented by Texas RioGrande Legal Aid, Carrillo Farm agreed to pay a total of $44,000 in lost wages to affected U.S. workers.

“U.S. workers are the backbone of our economy, and the Justice Department will not tolerate employers discriminating against them because of their citizenship status,” said Acting Assistant Attorney General Tom Wheeler of the Civil Rights Division. “The department is wholeheartedly committed to challenging discriminatory hiring preferences that disfavor U.S. workers. We commend Texas RioGrande for bringing the matter to our attention and applaud Carrillo Farm for cooperating with the department to implement the corrective actions necessary to resolve this matter.”

This settlement is part of a Justice Department enforcement initiative dedicated to combatting employment discrimination against U.S. workers.

The Division’s Immigration and Employee Rights Section (IER), formerly known as the Office of Special Counsel for Immigration-Related Unfair Employment Practices, is responsible for enforcing the anti-discrimination provision of the INA. The statute prohibits, among other things, citizenship status and national origin discrimination in hiring, firing, or recruitment or referral for a fee; unfair documentary practices; retaliation; and intimidation.

For more information about protections against employment discrimination under immigration laws, call IER’s worker hotline at 1-800-255-7688 (1-800-237-2515, TTY for hearing impaired); call IER’s employer hotline at 1-800-255-8155 (1-800-237-2515, TTY for hearing impaired); sign up for a free webinar; email IER@usdoj.gov; or visit IER’s English and Spanish websites.

Applicants or employees who believe they were subjected to: different documentary requirements based on their citizenship, immigration status, or national origin; or discrimination based on their citizenship, immigration status or national origin in hiring, firing, or recruitment or referral, should contact IER’s worker hotline for assistance.

President Trump’s FY 2018 Budget proposal totals $27.7 billion for the Department of Justice to support federal law enforcement and criminal justice priorities of our state, local and tribal law enforcement partners. The request represents a comprehensive investment in the Justice mission and includes increases in funding for strengthening national security efforts, supporting law enforcement, and enforcing the nation’s immigration laws. The request represents a $1.1 billion decrease over the annualized FY 2017 continuing resolution (CR) level.

“The Department of Justice is dedicated to advancing the safety, the security, and the rights of all Americans – and the FY 2018 budget reflects the President’s commitment to keep America safe,” said Attorney General Jeff Sessions. “One of the Justice Department’s top priorities is to protect the United States from threats to our national security both foreign and domestic. The Department will enforce our laws and put criminals behind bars. We will fight the scourge of drug abuse. And we will support the courageous men and women of law enforcement, as they work day and night to protect us. The President’s budget allows the Department to continue to put America first.”

The Department of Justice’s areas of investment include:

• +$403 million for the Federal law enforcement operations – the FBI, the U.S. Marshals Service, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Drug Enforcement Administration – securing our nation and implementing a range of efforts to target violent criminals and to combat transnational organized crime groups, especially those trafficking drugs into the U.S.
• +$61 million for the U.S. Attorneys, including $26 million for 300 new Assistant U.S. Attorneys (AUSAs) nationwide: 230 AUSAs to prosecute violent criminals and ensure our neighborhoods are freed from their threat, and an additional 70 AUSAs to protect our borders and restore our sovereignty by prosecuting immigration law violations.
• +$14 million for the Department’s litigating components, including $3.7 million and 40 new positions for the Environment and Natural Resources Division and the Civil Division* and $6 million for the National Security Division.
• +$79 million for the Executive Office of Immigration Review (EOIR), including $75 million for 75 new Immigration Judges and associated positions, boosting the Department’s capacity for prompt, efficient, and just hearings for those accused of violations of immigration law.
• $2.0 billion in discretionary funding, plus an additional $3.1 billion in mandatory sources, totaling $5.1 billion for Federal grants to State, local, and tribal law enforcement and victims of crime, to ensure greater safety for law enforcement personnel and the people they serve. Critical programs aimed at protecting the life and safety of state and local law enforcement personnel, including the COPS Hiring Program, Preventing Violence Against Law Enforcement Officer Resilience and Survivability and the Bulletproof Vest Partnership, demonstrate our continuing commitment to supporting state, local, and tribal law enforcement.

For more information, view the FY 2018 Budget and Performance Summary at https://www.justice.gov/doj/fy-2018-budget-and-performance-summary.

National Security

National security remains the Department’s highest priority.  The Department will always maintain its commitment and its responsibility to safeguard American citizens and defend the homeland, while maintaining American values. Threats are constantly evolving, requiring additional investments to mitigate those threats in innovative ways. Terrorist seek to sabotage critical infrastructure; organized crime syndicates seek to defraud banks and corporations; and spies seek to steal defense and intelligence secrets and intellectual property. Each threatens our nation’s economy and security. 

The FY 2018 Budget will support the Department in responding to those evolving threats by dedicating $98.5 million to  provide program enhancements for areas of 1) combatting domestic and foreign terrorism; 2) intelligence collection and analysis; 3) cybercrime; and 4) investigative and law enforcement technology.

For more information, view the National Security Fact Sheet at https://www.justice.gov/doj/fy-2018-budget-fact-sheets.

Combatting Violent Crime

Violent crime and drug use are becoming more and more commonplace within our communities. While today’s overall crime rates are near historic lows, recent trends indicate that those levels are at risk. Updated FBI statistics show that from 2014 to 2015, violent crime has increased more than 3 percent, which is the largest one-year increase in the last 24 years. The murder rate has increased 10 percent, the largest increase since 1968. Compounding this issue is the opioid and illegal drug epidemic. Heroin overdose deaths have more than tripled between 2010 and 2014 while illegal drugs flood across our borders into cities and towns bringing violence and tragedy with them. Protecting the people of this country from violent crime is a high calling of the men and women of the Department of Justice. Today, it has become more important than ever.

The FY 2018 budget requests $198.5 million in enhancements to reduce violent crime, combat the prescription drug and opioid epidemic, and target Transnational Criminal Organizations.  These resources will enable the Department to target and dismantle the worst criminal organizations and drug traffickers that are bringing violence and drugs into our communities. The Department of Justice utilizes a comprehensive set of programs that leverage law enforcement operations, prosecutorial action, and support for state and local governments to combat the violent offenders in our communities.

For more information, view the Combatting Violent Crime Fact Sheet at https://www.justice.gov/doj/fy-2018-budget-fact-sheets.

Enforce Immigration Laws

The FY 2018 budget enhances border security and immigration enforcement and improves the Department’s ability to conduct more efficient and expedient immigration hearings to combat illegal entry and unlawful presence in the U.S.  The Department requests increases of $144.9 million to enforce the President’s January 25 Executive Order, “Border Security and Immigration Enforcement Improvements” and keep pace with the Department of Homeland Security’s (DHS) increased immigration enforcement efforts.

For more information, view the Enforce Immigration Laws Fact Sheet at https://www.justice.gov/doj/fy-2018-budget-fact-sheets.

State, Local and Tribal Assistance

The Justice Department strongly supports its partnerships with state, local, and tribal entities. The FY 2018 Budget maintains its commitments to state, local, and tribal law enforcement partners without reducing the Department’s federal operational role. Simultaneously, efficiencies are identified to ensure that federal resources are being targeted to key Administration priorities, such as combating violent crime. The FY 2018 discretionary and mandatory request for state, local, and tribal law enforcement assistance is $5.1 billion, including specific discretionary enhancements of $107.0 million.

For more information, view the State, Local and Tribal Assistance Fact Sheet at https://www.justice.gov/doj/fy-2018-budget-fact-sheets.

*This release was revised to correct that the 40 new positions are for the Environment and Natural Resources Division and the Civil Division.

U.S. Attorney General Jeff Sessions met in Washington on May 19, 2017, with Dr. Ali Bin Fetais Al Marri, Attorney General of the State of Qatar. They discussed the close cooperation between the U.S. Department of Justice and the Qatari Office of the Attorney General and agreed to continue this cooperation, including on fighting terrorism and transnational crime. Attorney General Sessions and Dr. Al Marri also discussed anti-corruption issues.

Today Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division announced that Banamex USA (BUSA), a financial institution based in Los Angeles, California, and a subsidiary of Citigroup Inc., agreed to forfeit $97.44 million and entered into a non-prosecution agreement (NPA) to resolve an investigation into BUSA’s Bank Secrecy Act (BSA) violations. In its agreement with the Justice Department, BUSA admitted to criminal violations by willfully failing to maintain an effective anti-money laundering (AML) compliance program with appropriate policies, procedures, and controls to guard against money laundering and willfully failing to file Suspicious Activity Reports (SARs).

According to admissions contained in the NPA and the accompanying statement of facts, from at least 2007 until at least 2012, BUSA processed more than 30 million remittance transactions to Mexico with a total value of more than $8.8 billion. During the same period, BUSA’s monitoring system issued more than 18,000 alerts involving more than $142 million in potentially suspicious remittance transactions. BUSA, however, conducted fewer than 10 investigations and filed only nine SARs in connection with these 18,000-plus alerts, filing no SARs on remittance transactions between 2010 and 2012.

BUSA also admitted that, for several years, BUSA recognized that it should have improved its monitoring of MSB remittances but failed to do so. BUSA employed a limited and manual transaction monitoring system, running only two scenarios to identify suspicious activity on the millions of remittance transactions it processed. These two scenarios produced paper reports that were intended to be reviewed by hand by the two employees assigned to perform the BSA functions of the bank, in addition to time-consuming non-BSA responsibilities. As BUSA began to expand its remittance processing business in 2006, BUSA understood the need to enhance its anti-money laundering efforts, yet failed to make necessary improvements to its transaction monitoring controls or to add staffing resources.

In July 2015, in a related matter, the Federal Deposit Insurance Corporation (FDIC) and California Department of Business Oversight ordered BUSA to pay a $140 million civil money penalty to resolve separate BSA regulatory investigations. Thus, the combined penalties paid by BUSA associated with the criminal and regulatory investigations of its BSA compliance violations amount to approximately $237.44 million. In March 2017, the FDIC also announced related enforcement actions against four former senior BUSA executives relating to BUSA’s violations of the BSA. As part of those actions, two executives were fined and prohibited from working at financial institutions in the future, one was fined, and one was prohibited from working at financial institutions in the future.

As explained in the Non-Prosecution Agreement, the Justice Department reached this resolution based on a number of factors. In particular, BUSA engaged in extensive remedial actions, including devoting significant resources to remediation of the BSA and AML deficiencies, exiting BUSA’s MSB business entirely, and ultimately ceasing all banking operations at BUSA. BUSA received partial credit for its cooperation with the Justice Department’s criminal investigation, including making factual presentations, voluntarily making foreign-based employees available for interviews in the United States, producing documents from foreign countries in ways that did not implicate foreign data privacy laws, and collecting, analyzing and organizing voluminous evidence and information for the Justice Department, including identifying and providing documents relating to certain individuals and topics. In addition, pursuant to the NPA, BUSA and Citigroup agreed to cooperate fully in this and any other Justice Department investigation relating to violations of the BSA and federal money laundering statutes and, for a period of one year, to report to the Justice Department any evidence or allegation of violations of the BSA or money laundering laws. Citigroup further agreed to report to the Justice Department regarding implementation of compliance measures to improve oversight of its subsidiaries’ BSA compliance.

This case was investigated by the Drug Enforcement Administration’s New England Field Division, the Internal Revenue Service’s Criminal Investigation Boston Field Office and the FDIC’s Office of Inspector General. Senior Trial Attorney Jennifer E. Ambuehl and Trial Attorney J. Randall Warden of the Criminal Division’s Money Laundering and Asset Recovery Section, Bank Integrity Unit, prosecuted the case. Assistant U.S. Attorneys David J. D’Addio and James E. Arnold of the U.S. Attorney’s Office for the District of Massachusetts provided significant assistance in this investigation.

The Justice Department wishes to thank the FDIC – both the San Francisco Office and FDIC Headquarters for its cooperation in this investigation.

Attorney General Jeff Sessions today issued the attached memo to all Department of Justice grant making components on the implementation of Executive Order 13768, “Enhancing Public Safety in the Interior of the United States.”

The Justice Department, along with the Federal Communications Commission (FCC) and Department of Homeland Security (DHS), today announced the nationwide rollout of the National Blue Alert Network, including newly developed deliverables and federal interagency cooperation to enhance the safety and support of America’s law enforcement officers. Under implementation by the Office of Community Oriented Policing Services (COPS Office), the National Blue Alert Network promotes rapid dissemination of information to law enforcement, the media and the public about violent offenders who have killed, seriously injured or pose an imminent threat to law enforcement, or when an officer is missing in connection with official duties.

Named in honor of two fallen New York City Police Department (NYPD) officers who were ambushed in December 2014, the Rafael Ramos and Wenjian Liu National Blue Alert Act was signed into law in May 2015. The COPS Office was selected to implement the Act in September 2016 and has partnered with other federal agencies, including the FCC and the Federal Emergency Management Agency (FEMA), to establish enhanced communications systems, guidelines and resources.

“This network provides the means of quickly identifying, pursuing and capturing violent offenders who have hurt, killed or pose an imminent danger to law enforcement,” said Attorney General Jeff Sessions. “This National Police Week, we are proud to show our support for our nation’s brave police officers, and to work with our federal partners to keep them safe.”

“The men and women of law enforcement put their lives on the line to protect and serve the public,” said Acting Associate Attorney General Jesse Panuccio. “The Department of Justice is committed to supporting law enforcement, and the National Blue Alert Network will provide this country with the necessary framework for rapid response to help save lives and apprehend criminals who would attack those who bravely protect public safety.”

Blue Alerts are operationally similar to AMBER Alerts and can be broadcast on television, radio, and sent to cellphones and other wireless devices. Like AMBER Alerts, which are designed to quickly provide information about missing children to the public, Blue Alerts provide details about possible assailants, including physical descriptions, vehicle information and other identifying characteristics.

At present, there are 27 states with Blue Alert plans; however, this coordinated framework will help facilitate and streamline the adoption of new Blue Alert plans throughout the nation and help integrate existing plans. To learn more about the National Blue Alert Network, visit https://cops.usdoj.gov/bluealert.

The COPS Office is a federal agency responsible for advancing community policing nationwide and has a long history of supporting officer safety and wellness. Since 1994, the COPS Office has invested more than $14 billion to advance community policing, including grants awarded to more than 13,000 state, local and tribal law enforcement agencies to fund the hiring and redeployment of approximately 129,000 officers and provide a variety of knowledge resource products including publications, training and technical assistance. For additional information about the COPS Office, please visit www.cops.usdoj.gov.

During the first week of May 2017, Steve Somerville (left), INTERPOL Washington Development and Operations Team member, participated in a training event for INTERPOL member countries Singapore and Malaysia. The training, hosted by Singapore, gave INTERPOL Washington an opportunity to refine and troubleshoot the integration of I-24/7 services. The training was part of the Asian Regional Capacity Building Initiative designed to integrate the full suite of INTERPOL tools and services into each country’s existing national information technology infrastructure. Other participating countries are Indonesia, Thailand, and the Philippines.

The Asian Capacity Building Project initiative helps countries to:

Develop or enhance their ability to contribute stolen or lost travel document (SLTD) data to INTERPOL’s SLTD database;

Enhance border and immigration screening capabilities by integrating INTERPOL’s I-24/7 network; and

Use INTERPOL Washington expertise to help member countries develop the information technology infrastructure needed to connect to INTERPOL information.

This initiative helps member countries to meet their United Nations Security Council obligations to “… prevent the movement of terrorists and terrorist groups by effective border controls … and to “… improve international, regional, and sub-regional cooperation through increased sharing of information.”

INTERPOL Washington is committed to providing global technical assistance to increase the capacity and long-term sustainability to interdict the illicit international travel of Foreign Terrorist Fighters and other transnational criminals through the strategic application and utilization of INTERPOL information sharing tools.

A component of the U.S. Department of Justice, INTERPOL Washington—the U.S. National Central Bureau—is co-managed by the U.S. Department of Homeland Security. As the designated representative to INTERPOL on behalf of the Attorney General, INTERPOL Washington serves as the national point of contact for all INTERPOL matters, coordinating international investigative efforts among member countries and the more than 18,000 local, state, federal, and tribal law enforcement agencies in the United States.

Attorney General Jeff Sessions today welcomed the confirmation of Rachel Brand to serve as the Department of Justice’s Associate Attorney General:

“I am pleased that the U.S. Senate has confirmed Rachel Brand to serve as Associate Attorney General, the third-ranking position in the Department of Justice. Rachel has proven herself to be a brilliant lawyer – graduating from Harvard Law School, clerking for Justice Anthony Kennedy and working in private practice, earning the respect of the entire legal community throughout her career. She is also a dedicated public servant who is strongly committed to upholding the rule of law and our Constitution, and she knows this Department well, having previously served with distinction as the Assistant Attorney General for the Office of Legal Policy. I know the entire Department of Justice joins me in congratulating her, and we look forward to her assuming her critical role in the Department. The Associate Attorney General has supervision over a number of key divisions: Antitrust Division, Civil Division, Civil Rights Division, Environment and Natural Resources Division, Tax Division, Office of Justice Programs, Community Oriented Policing Services (COPS), Community Relations Service, Office of Dispute Resolution, Office on Violence Against Women, Office of Information Policy, Executive Office for U.S. Trustees, Foreign Claims Settlement Commission, and the Servicemembers and Veterans Initiative.”

The Justice Department announced today that it reached a settlement agreement with Washington Potato Company and Pasco Processing, LLC, which operate a fruit and vegetable processing facility located in Pasco, Washington.  The agreement resolves a discrimination lawsuit the Justice Department filed against the companies on Nov. 14, 2016.

The department’s lawsuit alleged that from at least Nov. 1, 2013, until at least Oct. 16, 2016, the companies routinely requested that lawful permanent residents hired at Pasco Processing produce a specific document – a Permanent Resident Card – to prove their work authorization, while not requesting a specific document from U.S. citizens.  The department’s complaint alleged that Washington Potato directed and controlled Pasco Processing’s hiring practices, including the discriminatory documentary practices at issue.  The antidiscrimination provision of the Immigration and Nationality Act (INA) prohibits such unfair documentary requests when based on citizenship status or national origin. 

Under the agreement, Washington Potato Company and Pasco Processing are required to pay civil penalties of $225,750, post notices informing workers about their rights under the INA’s antidiscrimination provision, train their human resources personnel on the requirements of the INA’s anti-discrimination provision, and be subject to departmental monitoring and reporting requirements. 

“The Justice Department is committed to removing illegal barriers to employment based on citizenship, immigration status, or national origin,” said Acting Assistant Attorney General Tom Wheeler of the Justice Department’s Civil Rights Division. “We look forward to working with Pasco Processing and Washington Potato Company to fulfill the terms of this agreement.”

The division’s Immigrant and Employee Rights Section (IER), formerly known as the Office of Special Counsel for Immigration-Related Unfair Employment Practices, is responsible for enforcing the anti-discrimination provision of the INA.  The statute prohibits, among other things, citizenship, immigration status, and national origin discrimination in hiring, firing, or recruitment or referral for a fee; unfair documentary practices; retaliation and intimidation.   

For more information about protections against employment discrimination under immigration laws, call IER’s worker hotline at 1-800-255-7688 (1-800-237-2515, TTY for hearing impaired); call IER’s employer hotline at 1-800-255-8155 (1-800-237-2515, TTY for hearing impaired); sign up for a free webinar; email IER@usdoj.gov; or visit IER’s English and Spanish websites.

Applicants or employees who believe they were subjected to different documentary requirements based on their citizenship, immigration status, or national origin; or discrimination based on their citizenship, immigration status, or national origin in hiring, firing, or recruitment or referral, should contact IER’s worker hotline for assistance.

A federal jury in Butte, Montana today returned a $37,343 verdict against a Bozeman, Montana landlord for charging a tenant with physical and psychiatric disabilities $1,000 to have a service animal, the Justice Department announced today.

The lawsuit, filed in U.S. District Court in Butte, alleged that Jaclyn Katz, the owner and manager of rental properties in Bozeman, discriminated against Kristen Newman, a tenant with physical and psychiatric disabilities, by charging her a $1,000 deposit as a condition for allowing her to keep her service dog, Riley.  At trial, Newman, her treating therapist and an independent expert testified that Riley assisted Newman in living with the symptoms of her disabilities, including providing emotional support, helping to predict migraines, and reducing suicidal thoughts.  Newman also testified that she repeatedly informed Katz that charging a deposit for a service animal was illegal and that Newman understood that she would have to pay for any actual damage caused by her service dog.  Nevertheless, Katz continued to levy this charge and, at one point, even threatened to terminate Newman’s tenancy.  The case arose out of a complaint filed by Newman with the U.S. Department of Housing and Urban Development.

The verdict includes $11,043 in compensatory damages for Newman, $20,000 in punitive damages for Newman, and $6,300 for Montana Fair Housing, Inc., which assisted Newman with her fair housing complaint. 

“Persons with disabilities have the right to live in and enjoy their communities, just as all families do throughout our nation,” said Acting Assistant Attorney General Tom Wheeler of the Justice Department’s Civil Rights Division.  “We commend the jury for recognizing that the Fair Housing Act prohibits landlords from discriminating against persons with disabilities, and we will continue to work to eliminate discriminatory barriers in housing for persons with disabilities.”

“Many people with disabilities require the assistance of an animal to carry out major daily activities,” said General Deputy Assistant Secretary Bryan Greene of the U.S. Department of Housing and Urban Development’s Fair Housing and Equal Opportunity. “Complaints alleging disability discrimination now account for the majority of the complaints HUD receives. HUD will continue to enforce the law and educate the public on the rights of people with disabilities in housing.”

The federal Fair Housing Act prohibits discrimination in housing based on race, color, religion, national origin, sex, disability and familial status. More information about the Civil Rights Division and the laws it enforces is available at www.justice.gov/crt. Persons who believe that they have experienced unlawful housing discrimination may contact the Justice Department at 1-800-896-7743, or by e-mail at fairhousing@usdoj.gov. 

Deputy Attorney General Rod J. Rosenstein today announced the appointment of former Department of Justice official and FBI Director Robert S. Mueller III to serve as Special Counsel to oversee the previously-confirmed FBI investigation of Russian government efforts to influence the 2016 presidential election and related matters.

“In my capacity as acting Attorney General, I determined that it is in the public interest for me to exercise my authority and appoint a Special Counsel to assume responsibility for this matter,” said Deputy Attorney General Rosenstein. “My decision is not a finding that crimes have been committed or that any prosecution is warranted. I have made no such determination. What I have determined is that based upon the unique circumstances, the public interest requires me to place this investigation under the authority of a person who exercises a degree of independence from the normal chain of command.”

Deputy Attorney General Rosenstein added, “Each year, the career professionals of the U.S. Department of Justice conduct tens of thousands of criminal investigations and handle countless other matters without regard to partisan political considerations. I have great confidence in the independence and integrity of our people and our processes. Considering the unique circumstances of this matter, however, I determined that a Special Counsel is necessary in order for the American people to have full confidence in the outcome. Our nation is grounded on the rule of law, and the public must be assured that government officials administer the law fairly. Special Counsel Mueller will have all appropriate resources to conduct a thorough and complete investigation, and I am confident that he will follow the facts, apply the law and reach a just result.”

Special Counsel Mueller has agreed to resign from his private law firm in order to avoid any conflicts of interest with firm clients or attorneys.

A copy of the order is attached.

A federal court in McAllen, Texas ordered Idalia Padron and Nino’s Home Care Inc. to timely file the business’s federal employment and unemployment tax returns as they become due and pay in full the reported amounts due. The court also entered a money judgment against Nino’s Home Care for more than $2.7 million, which represents its past unpaid employment taxes.

The complaint filed by the government against Padron and Nino’s Home Care alleged that Padron of Edinburg, Texas, operates Nino’s Home Care, a home health care service provider located at 121 W. Samano Street in Edinburg, and that Nino’s Home Care failed to pay its employment taxes for 20 tax quarters between 2005 and 2016. The complaint also alleged that Padron paid herself more than $100,000 in salary in 2015, a year in which Nino’s Home Care failed to pay over to the Internal Revenue Service (IRS) more than $850,000 in employment taxes.

Employers like Nino’s Home Care have specific responsibilities regarding employment taxes. When a business pays its employees, it does not pay them directly all the money they earn. Every business with employees has a legal responsibility to withhold from employees’ paychecks, and pay over to the U.S. Treasury, income taxes and the employees’ share of social security and Medicare taxes. Businesses that fail to collect these employment taxes or pay them over to the Treasury are subject to a number of potential enforcement actions.

Civil injunctions like the one entered by the court against Nino’s Home Care are one example of employment tax enforcement. An injunction order requires the employer and its principal officers to timely deposit and pay employment taxes to the U.S. Treasury. These court orders also impose various other requirements and prohibitions, including the obligation to provide current notice of each deposit to the IRS, as well as restrictions on opening and operating new businesses and transferring or dissipating assets.

For example, a federal court in McAllen, Texas also barred Jorge Gallegos and Con Brazos Abiertos LLC from failing to pay the business’s employment and unemployment taxes, in addition to requiring Gallegos to notify the IRS of any new company he may come to own, manage, or work for in the next five years. The government’s complaint alleged that Con Brazos Abiertos is a home health care service provider located at 505 S. Texas Blvd. in Weslaco, Texas. The government alleged that Gallegos of Mercedes, Texas, is the president and chief of Con Brazos Abiertos, and the business failed to pay its employment taxes for numerous quarters between 2011 and 2016. In addition to enjoining Gallegos and Con Brazos Abiertos, the court entered a judgment of more than $1 million against Con Brazos Abiertos for its unpaid employment and unemployment taxes.

If an employer violates a civil injunction, the Justice Department’s Tax Division will seek to have the employer and responsible individuals held in contempt, and request appropriate sanctions, including incarceration, to bring the business into compliance with the court’s order. Where appropriate, the Department will also seek compensation, from the principal officers or the business, for the damage the contempt has caused. In addition to this relief, courts have ordered businesses to close their doors for continued failure to meet their employment tax obligations. For example, a federal court in Washington held two individuals in contempt of court for a consistent pattern of failing to meet the businesses’ employment tax obligations. The court later ordered the two to close their dental care businesses, cease operating as employers, and barred them from opening any new businesses where the two would serve as employers by June 8.

The Tax Division works with its partners in the IRS to force employers who are cheating to follow the law and collect what is owed. Since 2003, the Tax Division has obtained more than 100 permanent injunctions against employers and tens of millions of dollars in money judgments. For more information about civil and criminal employment tax enforcement efforts, visit the Tax Division’s website.

The Antitrust Division of the Department of Justice announced today that it is conducting an investigation into the possible acquisition of the Chicago Sun-Times by tronc, Inc., the owner of the Chicago Tribune.  

The owner of the Chicago Sun-Times, Wrapports LLC, disclosed today that (i) the Chicago Sun-Times is seeking a buyer that will continue to publish the newspaper; (ii) if no other viable buyer expressing substantial interest in purchasing the Chicago Sun-Times comes forward within 15 calendar days of publication in the Chicago Sun-Times of an advertisement inviting expressions of interest, the Chicago Sun-Times will be sold to tronc, Inc.; and (iii) within the 15 calendar day period, prospective buyers must begin due diligence and indicate an expression of interest, including a price range for the Chicago Sun-Times, and demonstrate the financial ability to operate the paper.  If another viable buyer comes forward within 15 calendar days, then the interested buyer will be provided a reasonable opportunity to conduct additional due diligence and negotiate the purchase of the Chicago Sun-Times.  

The Antitrust Division is the agency responsible for investigating mergers involving newspapers.  The Antitrust Division will closely monitor the sale process for the Chicago Sun-Times, including whether any other viable buyer expresses interest.  In addition to contacting Wrapports, interested prospective buyers are invited to contact as soon as possible the Litigation III Section of the Antitrust Division directly at (202) 305-8376.

tronc is a Delaware corporation headquartered in Chicago.  It publishes major daily newspapers across California, Illinois, Florida, Maryland, Connecticut, Virginia and Pennsylvania.  Wrapports is a privately-held corporation based in Chicago.

          Today, SHAWN N. ANDERSON, Acting United States Attorney for the Districts of Guam and the Northern Mariana Islands, announced that defendant GEORGE M. BAMBA, II, age 38 from Agana Heights, was sentenced in District Court to a 37-month term of imprisonment, to be followed by five years of supervised release. The Court also ordered BAMBA to pay a mandatory $100 assessment fee. In addition, defendants who are convicted of a federal drug offense may no longer qualify for certain federal benefits.

          November 5, 2015, BAMBA waived Indictment and entered a guilty plea to an Information charging him with Conspiracy to Distribute 50 Grams or More of Methamphetamine, in violation of 21 U.S.C. §§ 846, 841(a)(1) and (b)(1)(A)(viii). The investigation revealed that BAMBA, and other individuals, agreed to use the mail system to distribute large quantities of methamphetamine on Guam. October 5, 2015, law enforcement agents seized a U.S. Postal Service package that concealed over 95 grams of methamphetamine that was 100% pure. BAMBA arranged to have the drugs sent to him in Guam from Las Vegas, Nevada.

          The U.S. Postal Service and the Drug Enforcement Administration conducted the investigation, with assistance by the Guam Superior Court Probation Office, Guam Customs and Quarantine Agency, and the Guam Police Department. The case was prosecuted by Clyde Lemons, Jr., and Assistant United States Attorney for the District of Guam.

At its annual meeting, the International Competition Network (ICN) adopted new recommended practices for merger review, addressing notification thresholds, remedies, and efficiencies; a framework for analyzing unilateral conduct; guiding principles for market studies; and a report on setting cartel fines, the Department of Justice announced today.

The ICN held its 16th annual conference, hosted by the Portuguese Competition Authority, on May 10-12, 2017.  More than 500 delegates from over 80 jurisdictions participated, including competition experts from international organizations and the legal, business, academic, and consumer communities.  Acting Assistant Attorney General Andrew Finch of the Department of Justice’s Antitrust Division and Acting FTC Chairman Maureen Ohlhausen led the U.S. delegation.  The conference showcased the achievements of the ICN working groups on unilateral conduct, mergers, competition advocacy, agency effectiveness and cartels.  The conference also discussed current competition issues and the future direction of the network.

“The ICN plays a central role in promoting collaboration among antitrust authorities from around the world,” said Acting Assistant Attorney General Finch.  “The Antitrust Division is committed to participating fully in efforts by ICN to promote international convergence in antitrust enforcement.  The annual conference is an excellent opportunity to explore with our international colleagues ways in which we can pursue our shared enforcement goals.”

Acting Assistant Attorney General Finch spoke on a panel discussing cartel leniency and challenges for the future.  The panel was part of the Cartel Working Group’s continuing focus on legal framework issues and enforcement techniques.  The Cartel Working Group also presented an updated report on how cartel fines are determined, highlighting common themes and methodologies across jurisdictions.

The Department of Justice co-chairs the Unilateral Conduct Working Group, which concluded a two-year project to produce a workbook chapter on the Analytical Framework for Evaluating Unilateral Conduct.  The project explores the issues an agency faces in formulating its unilateral conduct enforcement policies, specifically focusing on two major questions in unilateral conduct enforcement: what is dominance and what makes conduct exclusionary.

The Agency Effectiveness Working Group made two additions to its Agency Practice Manual that addressed effective operations of a competition agency: a report on competition agencies’ use of social media and a report on agency staff training.  The Social Media Report describes competition agencies’ external social media communication usage, strategies, and lessons learned, while the Staff Training Report focuses on training tools used by member agencies.  It also presented three new video training modules as part of its on-line interactive educational center for competition authorities from around the world.

“Through their participation in the conference, the world’s competition agencies demonstrate a shared commitment to strive toward convergence on sound competition analysis and fair process in antitrust investigations,” said FTC Acting Chairman Ohlhausen.  “The ICN serves as an important forum to further advance international coordination and cooperation of antitrust enforcement based on sound economics, procedural fairness, transparency and non-discriminatory treatment of parties.”

Acting Chairman Ohlhausen helped lead the conference’s discussion of the analysis of non-price effects in merger analysis.  The panel explored the potential effects of mergers on non-price dimensions such as quality, innovation, product variety, and service.  The FTC co-chairs the ICN’s Merger Working Group, which promotes convergence toward best practices in merger review process and analysis and seeks to reduce the public and private costs of multijurisdictional merger reviews.   

This year, the Merger Working Group presented four new Recommended Practices on 1) the types of transactions subject to merger review, 2) merger notification thresholds, 3) merger remedies, and 4) the analysis of merger efficiencies.  These recommendations join two sets of Merger Recommended Practices that address a range of notification, review, and analysis issues.   Recommended Practices are the ICN’s most prominent and influential work product, used by agencies around the world to benchmark their own practices and inspire convergence.

The Advocacy Working Group provides guidance and facilitates experience sharing to improve the effectiveness of ICN members’ competition advocacy.  This year, the group created new Market Studies Guiding Principles, a compilation of effective practices for agencies to consider when undertaking studies to understand the state of competition in specific sectors.  It also expanded its “Explaining the Benefits of Competition” resources to include tips, messages, and case studies on communicating with the public.

Created in October 2001 to increase understanding of competition policy and promote convergence toward sound antitrust enforcement around the world, the ICN, founded by 15 members including the Department of Justice’s Antitrust Division and the FTC, has grown to 135 member agencies from 122 jurisdictions,  supported by a wide network of non-government advisors from around the world.

A Rome, New York, man was sentenced today to 120 months in prison for attempted coercion and enticement of a minor to engage in unlawful sexual activity.

Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division; U.S. Attorney Dana J. Boente of the Eastern District of Virginia; and Colonel Edwin C. Roessler Jr., Chief of the Fairfax County, Virginia, Police Department made the announcement.

Julio Perez-Torres, 26, was sentenced today by U.S. District Judge Liam O’Grady of the Eastern District of Virginia who also ordered him to serve 20 years of supervised release. Perez-Torres previously pleaded guilty on Jan. 13, 2017.

According to admissions made in connection with his plea agreement, in early February 2016, Perez-Torres, a master’s degree candidate at American University, posted an online advertisement expressing interest in sex with children. When an undercover Fairfax County police officer replied to the ad, portraying himself as the father of two children, ages five and seven, Perez-Torres discussed performing graphic sexual acts on the children. On Feb. 18, 2016, after weeks of corresponding with the undercover officer via emails, text messages and telephone calls containing sexually explicit content, Perez-Torres traveled across state lines to meet the undercover officer with the intent to engage in sexual acts with the children. Perez-Torres was arrested at that time.

Trial Attorney James E. Burke IV of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Kellen Dwyer of the Eastern District of Virginia prosecuted the case.

This investigation was a part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.

A former administrative law judge for the Social Security Administration (SSA) pleaded guilty in federal court today for his role in a scheme to fraudulently obtain more than $550 million in federal disability payments from the SSA for thousands of claimants.

Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division; Special Agent in Charge Michael McGill of the Social Security Administration-Office of Inspector General’s (SSA-OIG) Philadelphia Field Division; Special Agent in Charge Amy S. Hess of the FBI’s Louisville, Kentucky, Field Division; Special Agent in Charge Tracey D. Montaño of the Internal Revenue Service-Criminal Investigation (IRS-CI) Nashville, Tennessee, Field Office; and Special Agent in Charge Derrick L. Jackson of the U.S. Department of Health and Human Services-Office of the Inspector General’s (HHS-OIG) Atlanta Regional Office made the announcement.

David Black Daugherty, 81, of Myrtle Beach, South Carolina, pleaded guilty before U.S. District Judge Danny C. Reeves of the Eastern District of Kentucky to an information charging him with two counts of receiving illegal gratuities. Sentencing is set for Aug. 25, 2017.

Daugherty was an administrative law judge at the Social Security hearing office in Huntington, West Virginia (Huntington Hearing Office) for more than 20 years, where his primary responsibility was to adjudicate disability claims on behalf of the SSA. According to admissions made as part of his guilty plea, from November 2004 to April 2011, Daugherty accepted more than $609,000 in cash payments, total, in more than approximately 3,100 cases from Social Security disability lawyer, Eric Christopher Conn, of Pikeville, Kentucky, for awarding disability benefits to claimants represented by Conn. Furthermore, in an effort to conceal the source of these cash payments, Daugherty divided cash deposits into various bank branches and accounts, he admitted.

Daugherty admitted that he sought out Conn’s cases pending with the Huntington Hearing Office, contacted Conn and told him what type of medical evidence to submit in support of disability findings and then awarded benefits to claimants represented by Conn without holding hearings. As a result, Conn ultimately received at least $7.1 million in representative fees from the SSA, and Daugherty further obligated the SSA to pay more than $550 million in lifetime benefits to claimants, according to the plea.

Daugherty was indicted on April 1, 2016, along with Conn and Alfred Bradley Adkins, a clinical psychologist of Pikeville. They were charged with conspiracy, fraud, false statements, money laundering and other related offenses in connection with the scheme. Conn pleaded guilty to the fraud scheme earlier this year. As to Adkins, who is awaiting trial, the indictment is merely an allegation as all defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

The SSA-OIG, FBI, IRS-CI and HHS-OIG investigated the case. Trial Attorneys Dustin M. Davis of the Criminal Division’s Fraud Section and Elizabeth G. Wright of the Criminal Division’s Money Laundering and Asset Recovery Section are prosecuting the case, with previous co-counsel including Assistant U.S. Attorney Trey Alford of the Western District of Missouri and Investigative Counsel Kristen M. Warden of the Justice Department’s Office of the Inspector General.

A federal court in New Orleans, Louisiana has permanently barred Tiga Bryant from preparing federal tax returns for others, the Justice Department announced today.  In its complaint, the government alleged that Tiga Bryant of New Orleans, Louisiana, sometimes doing business as “Denson’s Fast Tax Services,” fraudulently reduced her customers’ tax liabilities by improperly claiming bogus deductions and fuel tax credits.  Bryant agreed to the civil injunction order entered against her, which requires her to turn over to the United States a list of all persons for whom she prepared federal tax returns since 2014.  The court also authorized the United States to monitor Bryant’s compliance with the terms of the injunction.

The government’s complaint alleged that Bryant claimed false employee business expense deductions that improperly reduced her customer’s taxable income.  In more than one example, the complaint alleged that Bryant claimed a customer incurred employee business expenses totaling slightly less than half the wages the customer earned in that particular year.  According to the complaint, Bryant even claimed that one of her customers had incurred employee business expenses totaling more than the wages the employee earned in that year.  In each of these instances, the customers did not actually incur the expenses Bryant reported on the return, according to the complaint.

In addition to claiming fraudulent deductions for her customers, Bryant also claimed bogus fuel tax credits, according to the complaint.  Fraud involving the fuel tax credit is one of the IRS’s Dirty Dozen Tax Scams for 2017.  The fuel tax credit is generally limited to off-highway business use, and consequently, not available to most taxpayers.  For example, Bryant reported on one of her customer’s returns that the customer used 2500 gallons of gasoline for off-highway business use when the customer only used her vehicle for driving between home, work, school, and child responsibilities, according to the complaint.

According to the complaint, the Internal Revenue Service (IRS) audited 197 returns prepared by Bryant and determined that Bryant claimed credits and/or deductions her customers were not entitled to take on 96 percent (189) of these returns and understated their tax liabilities by more than $800,000.

Return preparer fraud is one of the IRS’s Dirty Dozen Tax Scams for 2017 and taxpayers seeking a return preparer should remain vigilant. The IRS has some tips on their website for choosing a tax preparer, and has launched a free directory of federal tax preparers.

In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.

Attorney General Jeff Sessions today issued the attached memorandum establishing charging and sentencing policies for the Department of Justice.

This policy was formulated after extensive consultation with Assistant U.S. Attorneys at both the trial and appellate level, as well as U.S. Attorneys and Main Justice Attorneys. It ensures that the Department enforces the law fairly and consistently, advances public safety and promotes respect for our legal system.

Attorney General Sessions will issue further remarks on the new policy later this morning.

The Attorney General today had a constructive meeting with Israeli Justice Minister Shaked. The two discussed the strong bond between the United States and Israel and focused on how they can cooperate in the areas of international criminal justice, terrorism and cyber threats. The Attorney General looks forward to continuing a strong, collaborative relationship with Israel’s Ministry of Justice and looks forward to future discussions.

Today, SHAWN N. ANDERSON, Acting United States Attorney for the Districts of Guam and the Northern Mariana Islands, announced that defendant MIGUEL CAMACHO, age 42, from Tumon, was sentenced in District Court on May 9, 2017, to a 63-month term of imprisonment, to be followed by three years of supervised release, and 100 hours of community service, for Conspiracy to Distribute Methamphetamine. The Court also ordered CAMACHO to pay a mandatory $100 assessment fee. In addition, defendants convicted of a federal drug offense may no longer qualify for certain federal benefits.

On September 28, 2015, CAMACHO waived Indictment and entered a guilty plea to an Information charging him with Conspiracy to Distribute Methamphetamine in violation of 21 U.S.C. §§ 846, 841(a) and (b)(1)(C). The investigation revealed that CAMACHO, and other individuals, used FedEx to distribute large quantities of methamphetamine to Guam from the Philippines. Law enforcement seized over 964 grams of methamphetamine, with a 97.1 percent purity level.

The investigation was conducted by the Department of Homeland Security, Homeland Security Investigations, Alcohol, Tobacco, Firearms and Explosives, Guam Customs and Quarantine Agency, Drug Enforcement Administration and the Guam Police Department. The case was prosecuted by Clyde Lemons, Jr., Assistant United States Attorney for the District of Guam.

Three related return preparers in South Florida prepare false tax returns for their customers, according to a new civil lawsuit filed by the Justice Department. The suit filed in the Southern District of Florida asks the court to permanently bar Fred Pickett Jr. and his children, Jalisa Steele and Fred Pickett III, from owning, operating, or franchising a tax return preparation business and preparing tax returns for others. According to the complaint, Pickett Jr., Steele, and Pickett III, all of Belle Glade, Florida, operate a tax return preparation business with several stores in South Florida under the names of Five Star Tax Services, Five Star Financial, and Millenium [sic] Tax Professionals. According to the complaint, the business has prepared over 8,000 returns since 2011 from the store locations in Belle Glade, Clewiston, Moore Haven, and La Belle, Florida.

The complaint alleges that by repeatedly underreporting tax liabilities and claiming bogus refunds on behalf of their customers, the defendants have caused the United States to lose substantial tax revenue. According to the complaint, the defendants misreport income, deductions, and credits on their customers’ tax returns by:

• Fabricating businesses and business-related profits or losses;

• Manipulating, maximizing, or falsely claiming the Earned Income Tax Credit (EITC);

• Claiming false education credits;

• Claiming spurious fuel tax credits;

• Fabricating retirement account contributions and deductions; and

• Failing to provide customers with complete copies of their tax returns.

One of the alleged examples of such conduct involves a married couple whose tax returns were prepared by Pickett Jr. According to the complaint, unbeknownst to the couple, Pickett Jr. reported a fake equipment business on their joint 2013 and 2014 tax returns, with combined losses that exceeded $90,000. These bogus losses, along with other retirement account-related fabrications, caused the couple to receive significantly inflated refunds each year, according to the complaint.

The complaint further alleges that the Internal Revenue Service (IRS) audited 55 tax returns prepared by the defendants. The IRS determined that each of these 55 tax returns resulted in a deficiency with an average tax deficiency of $5,891 per return and a total revenue loss of $323,986, according to the complaint.

Return preparer fraud is one of the IRS's Dirty Dozen Tax Scams for 2017 and taxpayers seeking a return preparer should remain vigilant. The IRS has some tips on their website for choosing a tax preparer and has launched a free directory of federal tax preparers.

In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.

Today, SHAWN N. ANDERSON, Acting United States Attorney for the Districts of Guam and the Northern Mariana Islands, announced that defendant JOSEPH ANTHONY JONES, age 46, from Ordot, was sentenced in District Court to an eight-month term of imprisonment, to be followed by three years of supervised release, and 50 hours of community service for Felon in Possession of a Firearm. The Court also ordered JONES to pay a mandatory $100 assessment fee.

On March 30, 2016, JONES was charged by Indictment with Felon in Possession of a Firearm, in violation of 18 U.S.C. § 922(g)(1), and Drug User in Possession of a Firearm, in violation of 18 U.S.C. § 922(g)(3). On April 27, 2016, JONES entered a guilty plea to the Felon in Possession of a Firearm charge. During December 2015, GPD and ATF executed a search warrant at the defendant’s residence in Ordot. Law enforcement seized a Ruger Mini-14, .223 caliber rifle, from inside the residence. Jones had previously been convicted of two felony drug charges in the Superior Court of Guam.

Acting U.S. Attorney Anderson stated, “Armed felons and unlawful drug users pose a grave danger to our communities. Federal law prohibits the possession of firearms and ammunition by such individuals. The Department of Justice will continue to focus resources on these prosecutions in an effort to prevent violent crime.”

The investigation was conducted by the ATF and the Guam Police Department, Special Investigation Section. The case was prosecuted by Frederick A. Black, Assistant United States Attorney for the District of Guam.

Today, SHAWN N. ANDERSON, Acting United States Attorney for the Districts of Guam and the Northern Mariana Islands, announced that defendant JERRY FRANCISCO, age 42, from Tamuning, was sentenced in District Court to a six month term of imprisonment, to be followed by six months of home detention, two years of supervised release, and 50 hours of community service, for Conspiracy to Possess with Intent to Distribute Methamphetamine. The Court also ordered FRANCISCO to pay a mandatory $100 assessment fee. In addition, defendants convicted of a federal drug offense may no longer qualify for certain federal benefits.

On March 23, 2016, FRANCISCO was charged by Indictment with Conspiracy to Possess with Intent to Distribute Methamphetamine, in violation of 21 U.S.C. §§ 846, 841(a)(1) and (b)(1)(C). He entered a guilty plea to the charge on March 31, 2016. The investigation revealed that FRANCISCO, and other individuals, in July of 2012 agreed to use the mail system to distribute methamphetamine on Guam. Law enforcement seized over 6.76 grams of methamphetamine, with a 99 percent purity level.

The investigation was conducted by the U.S. Postal Service and the Drug Enforcement Administration. The case was prosecuted by Frederick A. Black, Assistant United States Attorney for the District of Guam.