District Not Recorded

The Department of Justice announced today nearly $50 million in Office on Violence Against Women (OVW) grants to provide survivors of gender-based violence with access to legal services and improve effective coordination of justice systems impacting victim and family safety. Specifically, OVW awarded a total of $35,659,296 to 59 grantees under the Legal Assistance for Victims Program, which addresses the legal needs of survivors of sexual assault, domestic violence, dating violence, and stalking. In addition, earlier this month, OVW’s Justice for Families Program awarded $14,191,208 to 26 projects that aim to improve the response of the civil and criminal justice systems to families with a history of domestic violence. The Justice for Families Program also supports supervised visitation and safe exchange of children.

“These grants will help expand access to the services and support that are essential to bringing justice within reach for survivors of gender-based violence,” said Attorney General Merrick B. Garland. “The Department’s Office on Violence Against Women will continue its important work to empower survivors with the resources they need to navigate our justice system, including by expanding access to legal representation, language assistance, and court-related programs.”

“Legal services and systems, including family courts, have a tremendous impact on survivors’ and their families’ livelihood, wellbeing, and freedom,” said OVW Acting Director Allison Randall. “Meaningful representation for survivors is vital, but can be difficult to attain in the aftermath of violence, or when someone is still trying to find safety. Grantees under OVW’s Legal Assistance for Victims and Justice for Families Programs help survivors navigate complicated processes and potentially dangerous points along the way, including supervised visitation, protection orders, and divorce.”

In addition to addressing survivors’ civil and criminal legal needs, the Legal Assistance for Victims Program expands pro bono legal assistance for survivors. The Justice for Families Program also finances court and court-related programs, provides legal assistance for survivors, and supports training for court personnel, child protective services workers, and others.

Later this year, OVW will launch the new Expanding Legal Services Initiative (ELSI) under the Legal Assistance for Victims Grant Program. ELSI will support entities that do not yet have a legal representation program and need assistance establishing one. Grantees will receive specific training to help create a legal program from the ground up, while prioritizing racial equity and underserved communities. OVW will release the solicitation for this new initiative in the fall. Eligible applicants include nonprofit organizations and tribal governments or tribal organizations that intend to establish a program to provide legal representation to victims of sexual assault, domestic violence, dating violence, or stalking. OVW will provide additional details at upcoming informational virtual events and answer questions from participants. Registration for virtual events will be added as it becomes available: https://www.justice.gov/ovw/events.

OVW provides leadership in developing the nation’s capacity to reduce violence through the implementation of the Violence Against Women Act and subsequent legislation. Created in 1995, OVW administers financial and technical assistance to communities across the country that are developing programs, policies, and practices aimed at ending domestic violence, dating violence, sexual assault, and stalking. In addition to overseeing federal grant programs, OVW undertakes initiatives in response to special needs identified by communities facing acute challenges. Learn more at www.justice.gov/ovw.

China International Marine Containers Group Co. Ltd. (CIMC) confirmed today that it has abandoned its intended acquisition of Maersk Container Industry A/S and Maersk Container Industry Qingdao Ltd. (collectively, MCI) after the Justice Department’s Antitrust Division’s thorough investigation. 

The proposed transaction would have combined two of the world’s four suppliers of insulated container boxes and refrigerated shipping containers. It would also have consolidated control of over 90% of insulated container box and refrigerated shipping container production worldwide in Chinese state-owned or state-controlled entities.

“American consumers depend on the global cold supply chain for many of our everyday essentials,” said Assistant Attorney General Jonathan Kanter of the Justice Department’s Antitrust Division.  “CIMC’s acquisition of MCI threatened to harm this critical aspect of our economy leading to higher prices, lower quality, and less resiliency in global supply chains.  It would have cemented CIMC’s dominant position in an already consolidated industry and eliminated MCI as an innovative, independent competitor.  The deal also would have substantially increased the risk of coordination among the remaining suppliers in the marketplace, most of whom would have been aligned through common ownership and related alliances.”

The Justice Department’s Antitrust Division and the German Bundeskartellamt cooperated during the course of their respective investigations.

A former senior executive for a defense contractor pleaded guilty today to tax evasion.

According to court documents and statements made in court, from 2013 through 2015, Zachary A. Friedman, of New York, New York, worked in the United Arab Emirates as a senior executive for a U.S. Department of Defense contracting company. From 2013 to 2015 Friedman evaded taxes he owed to the IRS by providing false information to his tax preparer that underreported the income he earned for each of those years. In total, Friedman concealed approximately $530,000 in income, causing a tax loss to the government of more than $207,000.

Friedman is the fourth defendant associated with the defense contracting company to plead guilty. Charles Squires (February 2022), James Robar (March 2022), and Ronald Thomas (April 2022) all pleaded guilty to tax evasion.

Friedman is scheduled to be sentenced at a later date. He faces a maximum penalty of five years in prison for tax evasion. He also faces a period of supervised release, restitution and monetary penalties. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and U.S. Attorney Matthew M. Graves for the District of Columbia made the announcement.

IRS-Criminal Investigation and the Special Inspector General for Afghanistan Reconstruction are investigating the case.

Assistance was provided by the Joint Chiefs of Global Tax Enforcement (J5), which brings together the taxing authorities of Australia, Canada, Netherlands, United Kingdom and the United States.

Senior Litigation Counsel Nanette Davis and Trial Attorneys Sarah Ranney and Ezra Spiro of the Tax Division, and Assistant U.S. Attorney Leslie Goemaat of the U.S. Attorney’s Office for the District of Columbia are prosecuting the case.

A Florida man was sentenced to one year and one day in prison today for criminal contempt for continuing to prepare and file tax returns with the IRS in violation of a federal court order barring him from doing so.

According to court documents and statements made in court, Guy Telfort, of Fort Lauderdale, Florida, previously owned and operated Tax Houses and Accounting Services, a Lauderdale Lakes tax preparation business. From approximately January 2015 through April 2019, Telfort and his employees prepared and filed tax returns for clients. In order to generate inflated IRS refunds for clients, some of these returns reported false items, including fictitious business income and losses and mileage deductions. On April 24, 2019, the U.S. District Court for the Southern District of Florida entered an injunction against Telfort in a civil proceeding, permanently barring Telfort from preparing federal tax returns for others.

Despite this court-ordered injunction, in 2020 and 2021, Telfort continued to prepare and file returns, working out of an Oakland Park, Florida, pawn shop. Telfort charged clients as much as $1,000 for each return filed with the IRS. Some of these tax returns reported false medical and dental expenses and charitable contributions, as well as fictitious businesses. To disguise his role in preparing these returns, Telfort used IRS Preparer Tax Identification Numbers belonging to other tax preparers. Over the two-year period, Telfort prepared nearly 1,200 tax returns for clients in willful violation of the permanent injunction.

In addition to the term of imprisonment, U.S. District Judge Federico A. Moreno ordered Telfort to serve three years of supervised release and pay $762,338.88 in restitution to the United States.

Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and U.S. Attorney Juan Antonio Gonzalez for the Southern District of Florida made the announcement. They thanked Trial Attorneys John Nasta Jr., Huiwen Audrey Xi and Jikky Thankachan of the Tax Division’s Civil Trial Section for investigating the case.

Trial Attorneys Ashley Stein and Casey Smith of the Tax Division’s Criminal Enforcement Section handled the criminal prosecution.

Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division, U.S. Attorney Roger Handberg for the Middle District of Florida and Special Agent in Charge David Walker of the FBI Tampa Field Office announced that a federal jury in Tampa, Florida, returned a guilty verdict against Jordan Patrick Leahy, 29, for a racially-motivated attack against a Black man who was traveling down a public roadway with his family. 

At trial the government introduced evidence that on Aug. 8, 2021, Leahy came upon the victim, J.T., who was driving his daughter and girlfriend home from a family get together, and began threatening J.T., calling him racial slurs, and used his car in an attempt to force J.T. and his family off the road. Leahy’s pursuit of J.T. and his family lasted nearly a mile and half before Leahy sideswiped J.T. as J.T. attempted to evade the attack. Leahy fled the scene of the accident, but stopped at the next red light. J.T. pulled behind Leahy at the light, and Leahy got out of his car, stormed at J.T., and tried to assault him, again yelling racial slurs. When officers from the Pinellas County Sherriff’s Office arrived on the scene, Leahy made numerous statements evidencing his bias motive, including telling the officers that Black people need to be kept “in their areas.”

 “Across America, families must be able to freely travel our public streets without fear of being attacked because of race,” said Assistant Attorney General Clarke. “This verdict should send a strong message that the Department of Justice remains firmly committed to prosecuting, to the fullest extent of the law, those who would use violence to enforce heinous racist beliefs.”

“No one should be targeted, threatened, intimidated or assaulted because of their race,” said U.S. Attorney Handberg. “The defendant in this case acted upon his bigoted beliefs and put an entire family and others’ safety at risk. We and our local, state and federal law enforcement partners will not tolerate such behaviors in our community.”

“Hate crimes are not just an attack on an individual, they are an attack on entire communities,” said Special Agent in Charge Walker. “We want to assure the public the FBI will work diligently investigating crimes driven by hate and intolerance. We encourage anyone who believes their civil rights have been violated to report it to the FBI.”

Leahy faces a maximum sentence of 10 years in prison, three years of supervised release and a fine of up to $250,000. Leahy was remanded to the custody of the U.S. Marshals pending sentencing.   

The case was investigated by the FBI, the Pinellas County Sheriff’s Office and the Florida Highway Patrol. Assistant U.S. Attorney Carlton Gammons for the Middle District of Florida and Trial Attorneys David Reese and Laura-Kate Bernstein of the Civil Rights Division are prosecuting the case.

Officer Philip Dupree, 38, formerly of the Fairmount Heights Police Department in Maryland, has been indicted by a federal grand jury on charges of violating a man’s civil rights and obstruction of justice. 

The indictment alleges that during the early morning hours of Aug. 4, 2019, Dupree was on duty as a Fairmont Heights Police Officer when he conducted a traffic stop in the District of Columbia. Dupree allegedly detained a man identified as T.S. and then deployed pepper spray in an unreasonable use of force against him. Dupree allegedly obstructed justice by submitting a probable cause statement that offered a false justification for his use of force on T.S.

Dupree faces a maximum sentence of 10 years in prison for his alleged use of unreasonable force. The obstruction of justice charge carries with it a maximum penalty of 20 years in prison.

Assistant Attorney General Kristen Clarke of the Justice Department's Civil Rights Division, U.S. Attorney Matthew Graves of the District of Columbia and Special Agent in Charge Wayne A. Jacobs of the FBI Washington Field Office made the announcement.

The case is being investigated by the FBI Washington Field Office and is being prosecuted by Trial Attorney Sanjay Patel of the Civil Rights Division and Assistant U.S. Attorney Kathryn Rakoczy of the District of Columbia.

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

The Department of Justice today announced that it has reached a settlement agreement with A. Olivarez Harvesting LLC (Olivarez). The settlement resolves a claim that Olivarez discriminated against two U.S. citizens based on their citizenship status when it denied them crop harvesting positions it had promised them and instead filled the jobs with temporary visa workers through the Department of Labor’s H-2A program, in violation of the anti-discrimination provision of the Immigration and Nationality Act (INA).

“Employers engage in unlawful discrimination against U.S. workers by giving an advantage to temporary visa workers because of their citizenship or immigration status,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “The Justice Department will continue to enforce the anti-discrimination provision of the INA to ensure that employers do not unlawfully deny employment to workers in the community because of their citizenship status, regardless of whether those workers are U.S. citizens or immigrants with permission to work in the United States.”

Based on its investigation, the department determined that Olivarez initially agreed to employ two brothers who are U.S. citizens to harvest corn, but then falsely told them that the harvesting work was no longer available and instead offered them warehouse jobs with a lower hourly wage. Olivarez employed only H-2A visa workers to do the harvesting work during that harvesting season. Under the H-2A visa program, employers are generally required to offer agricultural jobs to qualified U.S. workers before sponsoring and hiring temporary visa workers from another country. Failure to do so could run afoul of the anti-discrimination provision of the INA if the employer’s preference for the temporary visa workers over U.S. workers is based on immigration or citizenship status.

Under the terms of the settlement agreement, Olivarez will pay a civil penalty for the violation, offer back pay plus interest totaling $14,165.10 (combined total) to the two affected workers, post notices informing workers of their rights under the INA’s anti-discrimination provision, train its staff and be subject to departmental monitoring for three years.

The Civil Rights Division’s Immigrant and Employee Rights Section (IER) is responsible for enforcing the anti-discrimination provision of the INA. The statute prohibits discrimination based on citizenship status and national origin in hiring, firing or recruitment or referral for a fee; unfair documentary practices; and retaliation and intimidation. 

Learn more about IER’s work and how to get assistance through this brief video. Find more information on how employers can avoid citizenship status discrimination on IER’s website. Applicants or employees who believe they were discriminated against based on their citizenship, immigration status or national origin in hiring, firing, recruitment or during the employment eligibility verification process (Form I-9 and E-Verify); or subjected to retaliation, may file a charge. The public can also 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); email IER@usdoj.gov; sign up for a free webinar; or visit IER’s English and Spanish websites. Subscribe to GovDelivery to receive updates from IER. View the Spanish translation of this press release here.

Today, the Department of Justice Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) “Frame or Receiver” Final Rule goes into effect. The new rule modernizes the definition of a firearm and makes clear that parts kits that are readily convertible to functional weapons, or functional “frames” or “receivers” of weapons, are subject to the same regulations as traditional firearms. This rule will help curb the proliferation of “ghost guns,” which are often assembled from kits, do not contain serial numbers, and are sold without background checks, making them difficult to trace and easy to acquire by criminals.

“Last year, the Justice Department committed to modernizing our regulations to address the proliferation of ‘ghost guns’ that law enforcement officers across the country have increasingly recovered from crime scenes,” said Attorney General Merrick B. Garland. “These guns have often been sold as build-your-own kits that contain all or almost all of the parts needed to quickly build an unmarked gun. And anyone could sell or buy these guns without a background check.

“That changes today. This rule will make it harder for criminals and other prohibited persons to obtain untraceable guns. It will help to ensure that law enforcement officers can retrieve the information they need to solve crimes. And it will help reduce the number of untraceable firearms flooding our communities. I am grateful to the professionals across the Department who worked tirelessly to get this important rule finalized and implemented, and who did so in a way that respects the rights of law-abiding Americans.

“The Justice Department will continue to do everything within its power to protect our communities from violent crime and put an end to the plague of gun violence.”

The rule, which was posted in the Federal Register in April, will address the proliferation of these un-serialized firearms in several ways. These include:

1. To help keep guns from being sold to convicted felons and other prohibited purchasers, the rule makes clear that retailers must run background checks before selling kits that contain the parts necessary for someone to readily make a gun.
2. To help law enforcement trace guns used in a crime, the rule modernizes the definition of frame or receiver, clarifying which part of a weapon must be marked with a serial number – including in easy-to-build firearm kits.
3. To help reduce the number of unmarked and hard-to-trace “ghost guns,” the rule establishes requirements for federally licensed firearms dealers and gunsmiths to have a serial number added to 3D printed guns or other un-serialized firearms they take into inventory.
4. To better support tracing efforts, the rule requires federal firearms licensees, including gun retailers, to retain records for the length of time they are licensed, thereby expanding records retention beyond the prior requirement of 20 years. Over the past decade, ATF has been unable to trace thousands of firearms – many reportedly used in homicides or other violent crimes – because the records had already been destroyed. These records will continue to belong to, and be maintained by, federal firearms licensees while they are in business.

The proliferation of privately made firearms (PMFs), also known as “ghost guns”, are a growing problem for law enforcement efforts to reduce violent crime. Recent federal prosecutions by the Chicago Firearms Trafficking Strike Force show the impact:

• An Orland Hills, Ill., man was charged with illegally selling 36 firearms, including “ghost guns” and machine guns, in the Chicago area. Many of the transactions occurred in a car wash in a Chicago suburb.
• Two Indianapolis men were charged with federal firearm violations for allegedly trafficking 10 guns, including four semiautomatic rifles and two “ghost guns,” from Indianapolis to Chicago.
• A Chicago resident was charged with trafficking more than a dozen guns, including a “ghost gun” and a machine gun, in Chicago.
• Five men were indicted for allegedly trafficking guns from St. Louis to Chicago.

As the final rule explains, from January 2016 to December 2021, ATF received approximately 45,240 reports of suspected PMFs recovered by law enforcement, including in 692 homicide or attempted homicide investigations.

In April 2021, the Attorney General announced that the ATF would be issuing a proposed rule within 30 days to address the proliferation of unmarked firearms increasingly being used in crimes. On May 7, 2021, the Department of Justice issued a notice of proposed rulemaking, and during the 90-day open comment period, the ATF received more than 290,000 comments, the highest number of comments submitted to a proposed rule in the Justice Department’s history.

The final rule, as submitted to the Federal Register, can be viewed here: https://www.atf.gov/rules-and-regulations/definition-frame-or-receiver.

A Florida woman was sentenced to one year and one day in prison today for helping to execute a nationwide tax fraud scheme and attempting to prevent the IRS from recovering a fraudulent refund she received after filing a false tax return.

According to court documents and statements made in court, Rebecca Cyphers, 65, of Winter Springs, Florida, participated in a nationwide tax fraud scheme from at least September 2014 to May 2016. As part of the scheme, promoters recruited clients by convincing them that their mortgages and other debts entitled them to tax refunds. Other members of the scheme prepared tax returns on behalf of clients for submission to the IRS, falsely reporting that banks and other financial institutions had withheld large amounts of income tax that entitled the clients to refunds. In reality, the financial institutions had not paid any income to, or withheld any taxes from, the clients. Cyphers admitted to her role in the scheme, which included inviting potential clients to at least one recruiting seminar. She also encouraged the prospective clients to participate in the scheme, even though Cyphers knew it was illegal.

Cyphers personally benefitted from the scheme by filing an amended 2013 income tax return that falsely claimed her mortgage holder had withheld more than $560,000 in taxes. As a result, the IRS issued Cyphers a refund of approximately $240,000 that she was not entitled to receive. Cyphers obstructed the IRS’s efforts to recover these ill-gotten profits by making large cash withdrawals from a bank account containing the refund amount, transferring much of the remaining amount into a trust, and sending frivolous correspondence to the IRS.

In addition to the term of imprisonment, U.S. District Judge Carlos E. Mendoza ordered Cyphers to serve one year of supervised release and to pay approximately $ $232,185.20 in restitution to the United States.

In March, the main promoter of the fraud scheme, Iran Backstrom, was sentenced to more than 8 years in prison, and Backstrom’s second-in-command, Mehef Bey, was sentenced to 11 years in prison. Another individual, Aaron Aqueron, was sentenced to 51 months in prison for recruiting clients to the scheme and providing information to another co-conspirator for use in the preparation of false tax returns. A fourth individual, Yomarie Febres, was also sentenced to 51 months in prison for preparing false tax returns for scheme participants. Several other individuals in Florida and around the country have received prison sentences for their involvement in the scheme.

Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and U.S. Attorney Roger B. Handberg for the Middle District of Florida made the announcement.

IRS-Criminal Investigation is investigating the case.

Trial Attorney Isaiah Boyd III of the Tax Division and Assistant U.S. Attorney Chauncey A. Bratt for the Middle District of Florida are prosecuting the case.

A Florida man pleaded guilty yesterday to filing a false tax return that claimed a fraudulent charitable contribution relating to the donation of a conservation easement over land. The plea was entered before U.S. Magistrate Judge Bruce E. Reinhart.

According to court documents and statements made in court, Randall Lenz, of Boca Raton, Florida, was a licensed CPA and attorney with more than thirty years of experience handling tax matters. From approximately 2015 through 2019, Lenz marketed to his clients illegal tax shelters developed and promoted by other individuals. In return, Lenz received a commission of 12% of the money his clients paid for their tax shelters. In all, Lenz received more than $700,000 in such commissions.

The tax shelters enabled high-income taxpayers to claim inflated charitable contribution deductions in connection with the purported donation of a conservation easement over land. The tax shelters operators created an LLC and then acquired land, or an entity that owned land, through the LLC. The promoters then sold units in funds operated by the LLCs to high-income clients. In exchange for those purchases, those clients were supplied with documentation and tax forms purporting to justify tax deductions in amounts 4 to 4.5 times the amount of money the clients paid for their units.

Lenz admitted that he knew the tax shelters did not entitle him to a tax deduction, but he nonetheless purchased units for himself for tax years 2018 and 2019. As a result, he was able to claim false charitable deductions of approximately $100,000 on his tax returns for each of those years.

Lenz faces a maximum penalty of three years in prison for filing a false tax return. He also faces a period of supervised release, restitution, and monetary penalties. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division made the announcement.

IRS-Criminal Investigation and U.S. Postal Inspection Service are investigating the case.

Trial Attorneys Jessica A. Kraft and Nichols J. Schilling Jr. of the Tax Division are prosecuting the case.

 El Departamento de Justicia anunció hoy que ha llegado a un acuerdo conciliatorio con A. Olivarez Harvesting, LLC («Olivarez»). El acuerdo resuelve una acusación de que Olivarez había discriminado a dos ciudadanos de los EE. UU. por motivos de su estatus de ciudadanía al denegarles el empleo en la cosecha de cultivos que les había prometido y, en su lugar, llenó las vacantes con trabajadores con visas temporales mediante el programa H-2A del Departamento de Trabajo, en contra de la disposición antidiscriminatoria de la ley de Inmigración y Nacionalidad («INA», por sus siglas en inglés).

«Los empleadores discriminan de manera ilegal a trabajadores en este país al darles una ventaja a  trabajadores con visas temporales, debido a su estatus migratorio o de ciudadanía», afirmó la Fiscal General Auxiliar Kristen Clarke, de la División de Derechos Civiles del Departamento de Justicia. «El Departamento de Justicia seguirá haciendo cumplir la disposición antidiscriminatoria de la INA con el fin de garantizar que los empleadores no denieguen, de manera ilegal, un empleo a trabajadores en la comunidad por motivos de su estatus de ciudadanía, independientemente de si son ciudadanos de los EE. UU. o inmigrantes con permiso para trabajar en los EE. UU.»

Con base en su investigación, el Departamento determinó que inicialmente, Olivarez había acordado inicialmente emplear a dos hermanos, ciudadanos de los EE. UU., para cosechar maíz, pero posteriormente les mintió, diciendo que el trabajo de cosecha ya no estaba disponible y, en su lugar, les ofreció puestos en un almacén, con un sueldo por hora más bajo. Durante aquella temporada de cosecha, Olivarez empleó únicamente a trabajadores con visas H-2A para realizar el trabajo de cosecha. Conforme al programa de visas H-2A, por lo general, a los empleadores se les requiere ofrecer empleos agrarios a trabajadores cualificados en este país antes de patrocinar y contratar a trabajadores con visas temporales de otro país. El incumplimiento con este requisito podría resultar en la infracción de la disposición antidiscriminatoria de la INA si la preferencia del empleador por trabajadores con visas temporales en vez de trabajadores en este país se basa en su respectivo estatus migratorio o de ciudadanía.

Conforme a los términos del acuerdo conciliatorio, Olivarez pagará una sanción civil por la infracción, ofrecerá pagos retroactivos más intereses que se ascienden a un total de $14,165.10 (total combinado) a los dos trabajadores afectados, publicará notificaciones para informar a los trabajadores de sus derechos en virtud de la disposición antidiscriminatoria de la INA, capacitará a su personal y se someterá a la supervisión del departamento durante tres años.

La Sección de Derechos de Inmigrantes y Empleados de la División de Derechos Civiles es responsable de hacer cumplir la disposición antidiscriminatoria de la INA. La ley prohíbe la discriminación por motivos de estatus de ciudadanía o nacionalidad de origen en los procesos de contratación, despido o reclutamiento o recomendación por comisión; prácticas documentales injustas y represalias e intimidación.

Para aprender más sobre la labor de la IER y cómo conseguir ayuda, vea este vídeo corto. Aprenda más sobre cómo los empleadores pueden evitar la discriminación por motivos de estatus de ciudadanía en el sitio web de la IER. Aquellos aspirantes o empleados que creen haber sido discriminados por motivos de su estatus de ciudadanía o nacionalidad de origen en los procesos de contratación, despido, reclutamiento o verificación de la elegibilidad para trabajar (Formulario I-9 e E-Verify) o sujetos a represalias pueden presentar una denuncia. El público también puede llamar a la línea directa de la IER para trabajadores al 1-800-255-7688 (1-800-237-2515, TTY para personas con discapacidades auditivas); llamar a la línea directa de la IER para empleadores al 1-800-255-8155 (1-800-237-2515, TTY para personas con discapacidades auditivas); enviar un correo electrónico a IER@usdoj.gov; inscribirse a un seminario en línea gratuito; o visitar los sitios web de la IER en inglés o español. Para recibir las últimas noticias de la IER, inscríbase a GovDelivery.

Today, Attorney General Merrick B. Garland announced the Department of Justice is now accepting nominations for the Sixth Annual Attorney General’s Award for Distinguished Service in Community Policing. Through this award, the Department of Justice honors the incredible work our nation’s law enforcement does to keep our communities and our country safe.

“Every day, law enforcement officers across the country work to forge and maintain strong community ties that are essential for ensuring public safety,” said Attorney General Garland. “The Department of Justice cannot fulfill its public safety mission without such critical efforts, and this award is just one way the Department says ‘thank you’ to our law enforcement partners.”

The Attorney General’s Award for Distinguished Service in Community Policing recognizes individual state, local, Tribal, and territorial police officers, deputies, and troopers for exceptional efforts in community policing. The awarded officers, deputies, and troopers will have demonstrated active engagement with the community in one of three areas: innovations in community policing, criminal investigations, or field operations. Within each category, an award will be given to law enforcement agencies serving small, medium, and large jurisdictions. Those agency sizes are defined as follows:

1. Small: agencies serving populations of fewer than 50,000.
2. Medium: agencies serving populations of 50,000 to 250,000.
3. Large: agencies serving populations of more than 250,000.

By acknowledging and rewarding these efforts, the Department strives to promote and sustain its commitment to community policing and to advance proactive policing practices that are fair and effective. With the Attorney General’s Award for Distinguished Service in Community Policing, the Justice Department recognizes that the nation’s law enforcement agencies, officers, deputies, and troopers continue to work tirelessly to keep our communities safe.

The deadline for nominations is Sept. 23, 2022 at 8 p.m. (ET). More information and the application for nominees can be found at: www.justice.gov/ag/policing-award.

Hagatña, Guam – SHAWN N. ANDERSON, United States Attorney for the Districts of Guam and the Northern Mariana Islands announced that defendant Maria E.L. Untalan, age 64, from Agana Heights, Guam was sentenced in the United States District Court of Guam to 65 months in federal prison for Conspiracy to Distribute Fifty (50) Grams or More of Methamphetamine Hydrochloride, in violation of 21 U.S.C. §§ 846 and 841(a)(1).  The Court ordered the Defendant to participate in a 500-hour drug treatment program, serve three years of supervised release following imprisonment, and pay a mandatory $100.00 special assessment fee.  The Court also ordered the forfeiture of a 2019 Harley Davidson motorcycle and $4,742.00 in cash.  In addition, defendants convicted of a federal drug offense may no longer qualify for certain federal benefits.

Between April 2018 and continuing through April 2019, Maria E.L. Untalan entered into an agreement with other persons to distribute over 50 grams of methamphetamine hydrochloride in Guam. As part of that agreement, Untalan received packages containing methamphetamine that were mailed using the United States Postal Service.  On March 25, 2019, Untalan picked up a package at the Postnet facility in Upper Tumon. The package consisted of methamphetamine hydrochloride wrapped in plastic and electrical tape.  The drug weighed 406 grams and was 100% pure.

“I congratulate our law enforcement partners for the results of their hard work in intercepting these drugs in the mail stream,” stated United States Attorney Anderson.  “As this case and recent reports indicate, methamphetamine continues to be shipped on island.  We will make every effort to seize illicit drugs and prosecute those who engage in this criminal activity.”

“Those who distribute dangerous drugs such as methamphetamine cause great harm in our communities and ultimately contribute to the addiction and substance abuse problem,” said DEA Los Angeles Deputy Special Agent in Charge Anthony Chrysanthis. “This sentencing sends a clear message that we will pursue and hold those responsible for distributing drugs on the island.”

“This sentence is a reminder to drug traffickers that we will not tolerate using the United States mail to transport-controlled substances in Guam or anywhere else,” said Acting Inspector in Charge Kevin Rho of the United States Postal Inspection Service, San Francisco Division. “I would like to thank our federal, territorial, and local law enforcement agencies for their partnership in stopping the spread of this methamphetamine and bringing this defendant to justice.”

The case resulted from an investigation by the Drug Enforcement Administration and the United States Postal Inspection Service. The case was prosecuted by Assistant United States Attorney Rosetta L. San Nicolas, United States Attorney’s Office for the District of Guam.

The United States, through the Department of Justice and FBI, forfeited approximately $23 million traceable to the corruption and money laundering of former Nigerian dictator Sani Abacha and his co-conspirators. This money will be returned to the Nigerian people through an agreement between the Governments of the United States and the Federal Republic of Nigeria (Nigeria) signed today in Abuja, Nigeria, by U.S. Ambassador Mary Beth Leonard. This repatriation will bring the total amount forfeited and returned by the Department of Justice in this case to approximately $334.7 million. 

In 2014, U.S. District Judge John D. Bates for the District of Columbia entered a judgment ordering the forfeiture of approximately $500 million located in accounts around the world, as the result of a civil forfeiture complaint for more than $625 million traceable to money laundering involving the proceeds of Abacha’s corruption. In 2020, the department repatriated over $311.7 million of the forfeited assets that had been located in the Bailiwick of Jersey. Last year, the U.K. government enforced the U.S. judgment against the additional $23 million.

“This repatriation of $23 million reflects the Justice Department’s unwavering commitment to recover and return corruption proceeds laundered through the U.S. financial system,” said Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division.

“Today’s agreement illustrates the FBI’s commitment to tracing, seizing, and forfeiting the assets of corrupt foreign officials who enrich themselves by abusing their power and violating the trust of their citizens,” said Assistant Director in Charge Steven M. D’Antuono of the FBI Washington Field Office. “The repatriation of these funds back to the people of Nigeria represent an important collaboration between the United States and Nigeria. The FBI and our partners around the world remain steadfast in protecting our financial systems from those who seek to use them as a tool to hide their corrupt, criminal proceeds.”

The forfeited assets represent corrupt monies laundered during and after the military regime of General Abacha, who became Head of State of the Federal Republic of Nigeria through a military coup on Nov. 17, 1993, and held that position until his death on June 8, 1998. The complaint alleges that General Abacha, his son Mohammed Sani Abacha, their associate Abubakar Atiku Bagudu and others embezzled, misappropriated and extorted billions from the government of Nigeria and others, then laundered their criminal proceeds through U.S. financial institutions and transactions in the United States. The United Kingdom’s cooperation in the investigation, restraint and enforcement of the U.S. judgement, along with the valuable contributions of Nigeria and other law enforcement partners around the world, including the United Kingdom’s National Crime Agency, as well as those of the Justice Department’s Office of International Affairs, have been instrumental to the recovery of these funds.

Under the agreement signed today, the United States will transfer 100% of the net forfeited assets to the Federal Republic of Nigeria to support three critical infrastructure projects in Nigeria that were previously authorized by Nigerian President Muhammadu Buhari and the Nigerian legislature. Specifically, the funds governed by this agreement will help finance the Second Niger Bridge, the Lagos-Ibadan Expressway and the Abuja-Kano road – investments that will benefit the citizens of each of these important regions in Nigeria. 

The agreement includes key measures to ensure transparency and accountability, including administration of the funds and projects by the Nigeria Sovereign Investment Authority (NSIA), financial review by an independent auditor and monitoring by an independent civil society organization with expertise in engineering and other areas. The agreement also precludes the expenditure of funds to benefit alleged perpetrators of the corruption or to pay contingency fees for lawyers. The agreement reflects the sound principles for ensuring transparency and accountability adopted at the Global Forum on Asset Recovery (GFAR) in December 2017 in Washington, D.C., which the United States and United Kingdom hosted with support from the Stolen Asset Recovery Initiative of the World Bank and United Nations Office on Drugs and Crime.

This case was brought under the Kleptocracy Asset Recovery Initiative by a team of dedicated prosecutors in the Criminal Division’s Money Laundering and Asset Recovery Section working in partnership with the FBI’s Washington Field Office. Through the Kleptocracy Asset Recovery Initiative, the Department of Justice and federal law enforcement agencies seek to safeguard the U.S. financial system from criminal money laundering and to recover the proceeds of foreign official corruption. Where appropriate and possible, the department endeavors to use recovered corruption proceeds to benefit the people harmed by acts of corruption and abuse of public trust. 

Individuals with information about possible proceeds of foreign corruption located in or laundered through the United States should contact federal law enforcement or send an email to kleptocracy@usdoj.gov. The department appreciates the extensive assistance provided by the Governments of the United Kingdom, Nigeria, Jersey, and France in this investigation. 

Assistant Attorney General Kenneth A. Polite, Jr. met today with a bipartisan group of election officials at the 37th Annual National Conference of The National Association of Election Officials.

Assistant Attorney General Polite discussed the ongoing work of the department’s Election Threats Task Force, including sharing intelligence, data, and analysis.

Assistant Attorney General Polite told participants that over the past year, the task force has held approximately 40 meetings, presentations, and trainings with the election community, state and local prosecutors, state and local law enforcement, vendors providing services to support election administration, and major social media companies.

Assistant Attorney General Polite thanked the election community for engaging directly with the task force in various ways over the past year. He stressed the importance that those lines of communication stay open ahead of election season and reminded the election community of the individual points of contact they have in every FBI field office in the country.

Assistant Attorney General Polite also briefed the election community on available funds for enhanced security for election offices, and the availability of additional resources from both academic and non-governmental organizations. Assistant Attorney General Polite and Principal Deputy Chief John Keller of the Criminal Division’s Public Integrity Section also highlighted recent federal charges against an individual accused of making a threat to an Arizona election official.

An Oregon man pleaded guilty to hate crime and false statement charges in the U.S. District Court for the Western District of Washington. Randy Smith, 42, pleaded guilty to committing a hate crime for his participation in the assault of T.S., a Black man, which occurred because of the man’s actual and perceived race. Smith assaulted T.S. at a bar in Lynnwood, Washington, on Dec. 8, 2018. 

In his plea agreement, Smith admitted that, at the time of the assault, he was a member of a white supremacist support group. On Dec. 8, 2018, Smith entered a bar in Lynnwood, Washington, with others, including fellow support group members as well as members of a higher-level white supremacist group. Smith wore clothing and patches indicating his group membership and gave a “Nazi salute” as he entered the bar. While inside, Smith assaulted T.S, a Black man who was serving as the disc jockey at the bar, because he believed that T.S. was being disrespectful to the members of the white supremacist groups. Smith repeatedly punched T.S., while others punched, kicked, and/or stomped on T.S. and called T.S. racial slurs. As a result of the assault, T.S. suffered bodily injuries. Two bystanders attempted to intervene to help T.S. and stop the assault. Both bystanders were assaulted by members of the white supremacist groups, and both sustained injuries. 

In addition to the hate crime charge, Smith pleaded guilty to making false statements to FBI agents about circumstances surrounding the assault. Specifically, Smith falsely claimed to the agents that he did not remember anyone calling T.S. a racial slur during the assault. This statement was false, in that Smith knew he and others called T.S. racial slurs before, during and after the assault. Smith made this false statement to the FBI because he wanted to cover up the motive for the assault, which was the bias that he and others had against T.S.’s race. 

Smith will be sentenced on Nov. 18. The hate crime charge carries a maximum penalty of 10 years in prison. The false statement charge carries a maximum penalty of up to five years in prison.  

Smith was charged in an indictment that was unsealed on Dec. 18, 2020. The seven-count indictment also charged three other men, each aiding and abetting one another, with punching and kicking T.S. while making derogatory comments about his actual and perceived race. The indictment further charged Smith and the three other men with assaulting two men who intervened to protect T.S. during the attack, as well as with making false statements to the FBI during the course of their investigation. Two of these three men, Jason DeSimas and Daniel Dorson, previously pleaded guilty in this matter.

Smith also pleaded guilty to an unlawful possession of a firearm charge, arising from conduct in Oregon in 2020. In the plea agreement, Smith admitted that he unlawfully possessed a Ruger 9mm pistol despite knowing that he had being previously convicted of a felony. The indictment for this charge was originally filed in the U.S. District Court for the District of Oregon in August 2020 and later transferred to the Western District of Washington. The unlawful possession of a firearm charge carries a maximum penalty of up to 10 years in prison. This case was investigated by the FBI and prosecuted by Assistant U.S. Attorney William McLaren of the District of Oregon.

Assistant Attorney General Kristen Clarke for the Justice Department’s Civil Rights Division and U.S. Attorney Nicholas W. Brown for the Western District of Washington made the announcement. This case was investigated by the FBI, with the support of the Snohomish County Sheriff’s Office. Trial Attorney Christine M. Siscaretti of the Civil Rights Division’s Criminal Section and Assistant U.S. Attorney Rebecca Cohen of the Western District of Washington are prosecuting the case.

The Justice Department announced today that former Louisville Metro Police Department (LMPD) Detective Kelly Goodlett, 35, pleaded guilty in federal court to conspiring to commit two federal crimes. Goodlett admitted that she conspired with another former LMPD detective, both to falsify an affidavit to obtain a warrant to search Breonna Taylor’s home without probable cause, which resulted in Taylor’s death, and to cover up the false warrant by lying to criminal investigators after Taylor was killed.

According to the plea agreement, Goodlett acknowledged that she helped another LMPD detective, and their supervisor obtain a warrant to search Taylor’s home, despite knowing that the officers lacked probable cause to do so. To establish probable cause, information in an affidavit accompanying a search warrant must be truthful and timely. Goodlett admitted that she knew that the affidavit in support of the warrant to search Taylor’s home was false, misleading and stale.

First, Goodlett admitted that key information in the warrant affidavit was false and misleading.  For example, the other LMPD detective claimed in the warrant affidavit that a U.S. Postal Inspector had verified that a target of LMPD’s narcotics investigation, J.G., had been receiving packages at Taylor’s home. Goodlett knew this claim was false because the other detective told her he had learned that “there’s nothing there” and that the Postal Service had not flagged Taylor’s address for receiving any suspicious packages.

The warrant affidavit also claimed that J.G. used Taylor’s home “as his current home address.” Goodlett admitted that this claim was misleading because officers knew that J.G. did not live at Taylor’s home. In fact, Goodlett acknowledged that she and the other detective knew of no evidence that J.G. had even visited Taylor’s home for several weeks before the warrant was obtained. 

In addition, the warrant affidavit requested permission for officers to make a “no-knock” entry at Taylor’s home because the alleged drug dealers that LMPD was investigating had a history of fleeing from the police and destroying evidence. Goodlett admitted that all of the information in the warrant affidavit justifying a no-knock entry for Taylor’s home was false as it related to Taylor. Goodlett was not aware of any valid reason to seek a no-knock warrant at Taylor’s home.

Further, Goodlett admitted knowing that the warrant for Taylor’s home would be executed at night by officers with their weapons drawn, creating a risk that a person in the home could be injured or killed.

In addition, Goodlett admitted that the warrant affidavit was “stale” because it lacked up-to-date information showing probable cause to believe that evidence of a crime would be found in Taylor’s home. For example, the affidavit used to obtain a warrant suggested that there was an ongoing relationship between Taylor and J.G. However, as noted in the plea agreement, Goodlett knew that the police had no evidence that J.G. had even visited Taylor’s home for weeks at the time the officers requested a warrant. Before the warrant affidavit was finalized, Goodlett told the other LMPD detective that the warrant affidavit did not have enough current information to connect Taylor or her home to J.G.’s alleged narcotics activity. Goodlett also knew that, the day before officers obtained the warrant, her supervisor had conducted surveillance outside of Taylor’s home in part to search for new information that could freshen up the warrant affidavit, but her supervisor reported that he did not find anything new to connect J.G. to Taylor or her home. 

Second, Goodlett admitted that she and the other detective conspired to obstruct justice by providing false information to investigators after Taylor was shot and killed. Specifically, in the plea agreement, Goodlett stated that she and the other detective provided a false “investigative letter” to criminal investigators, repeating the false and misleading claims from the warrant affidavit about J.G. receiving packages at Taylor’s home and using Taylor’s home as “his residence.” Goodlett admitted that she had hoped the false investigative letter would clear her and the other detective of suspicion of wrongdoing.

In her plea agreement, Goodlett also acknowledged that, approximately two weeks after they submitted the false investigative letter, she and the other detective agreed again to provide false information in response to allegations in the media that the other detective had lied in the warrant affidavit. On May 16, 2020, about two months after Taylor’s death, media outlets reported that the Postal Inspector had specifically denied the other detective’s claim, made in the warrant affidavit, that the U.S. Postal Inspection Service had told police that J.G. received packages at Taylor’s home. The next day, the other detective texted Goodlett that a criminal investigator wanted to meet with him. Goodlett further admitted that she and the other detective arranged to meet in the detective’s garage that night. During the garage meeting, the other detective told Goodlett that they needed to get on the same page because if he went down for the false warrant, she would go down too. Goodlett admitted that she and the other detective agreed to repeat a false cover story to others. Specifically, after the garage meeting, Goodlett falsely claimed to criminal investigators that, in January 2020, an LMPD sergeant had told her and the other detective “in passing” that he had verified that J.G. was receiving packages at Taylor’s home.  

Goodlett pleaded guilty today before U.S. District Court Judge Rebecca Grady Jennings. Goodlett will be sentenced at a hearing to be scheduled at a later date.  According to the plea agreement, Goodlett faces a maximum sentence of five years in prison and a fine of up to $250,000. 

Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division made the announcement.

The FBI Louisville Field Office investigated the case. Trial Attorneys Michael J. Songer and Anna Gotfryd of the Department of Justice’s Civil Rights Division are prosecuting the case with assistance from Assistant U.S. Attorney Zachary Dembo for the Eastern District of Kentucky.

Essilor International, Essilor of America Inc., Essilor Laboratories of America Inc. and Essilor Instruments USA (collectively, “Essilor”), headquartered in Dallas, have agreed to pay $16.4 million to resolve allegations that the company violated the False Claims Act by causing claims to be submitted to Medicare and Medicaid that resulted from violations of the Anti-Kickback Statute. 

Essilor manufactures, markets and distributes optical lenses and equipment used to produce optical lenses. The United States alleged that between Jan. 1, 2011, and Dec. 31, 2016, Essilor knowingly and willfully offered or paid remuneration to eye care providers, such as optometrists and ophthalmologists, to induce those providers to order and purchase Essilor products for their patients, including Medicare and Medicaid beneficiaries, in violation of the Anti-Kickback Statute. The Anti‑Kickback Statute prohibits offering or paying anything of value to induce the referral of items or services covered by Medicare, Medicaid and other federally-funded programs. The statute is intended to ensure that medical providers’ judgments are not compromised by improper financial incentives.

“When medical equipment manufacturers provide kickbacks to referring providers, it can compromise the integrity of medical decision-making,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “The department will continue to pursue violations of the Anti-Kickback Statute to ensure that patient care is not influenced by improper financial incentives.”

“The Anti-Kickback Statute was designed to ensure doctors make medical decisions with only their patients’ best interests in mind,” said U.S. Attorney Chad Meacham of the Northern District of Texas. “We are pleased to see Essilor taking financial responsibility for their conduct.”

“Our healthcare system is predicated on providers making decisions solely in the best interest of the patient,” said U.S. Attorney Jacquelin Romero of the Eastern District of Pennsylvania. “Kickbacks threaten to corrupt that decision-making.  The U.S. Attorney’s Office stands ready to pursue anyone who fails to abide by the rules that ensure our system functions as it should.”

“Kickback schemes can impact medical judgment, eroding the trust of both patients and taxpayers,” said Lisa M. Re, Acting Chief Counsel at the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG). “Essilor’s Corporate Integrity Agreement is intended to establish policies and practices so it complies with the Anti-Kickback Statute moving forward.”

In connection with the settlement, Essilor entered into a five-year Corporate Integrity Agreement (CIA) with HHS-OIG. The CIA requires, among other things, that Essilor hire an independent review organization to review its systems, policies, processes and procedures for ensuring that any discounts, rebates, or other reductions in price offered to providers comply with the Anti-Kickback Statute. The CIA also requires Essilor to implement a new written review and approval process to ensure all existing and new discount arrangements comply with the Anti-Kickback Statute.

The civil settlement includes the resolution of claims brought under the qui tam or whistleblower provisions of the False Claims Act by relators Laura Thompson, Lisa Brez, and Christie Rudolph, former Essilor district sales managers. Under those provisions, a private party can file an action on behalf of the United States and receive a portion of any recovery.  The qui tam cases are captioned United States ex rel. Laura Thompson & Lisa Brez v. Essilor Int’l, No. 3:15-CV-2853-C (N.D. Tex.) and United States ex rel. Christie Rudolph v. Essilor Labs. of Am., Inc., No. 16-CV-0537 (WB) (E.D. Pa.).

The resolution obtained in this matter was the result of a coordinated effort between the Justice Department’s Civil Division, Commercial Litigation Branch, Fraud Section and the U.S. Attorneys’ Offices for the Northern District of Texas and the Eastern District of Pennsylvania.

The investigation and resolution of this matter illustrates the government’s emphasis on combating healthcare fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse and mismanagement can be reported to the Department of Health and Human Services at 800-HHS-TIPS (800-447-8477).

The matter was handled by Senior Trial Counsel Diana Cieslak and Assistant U.S. Attorneys Braden Civins of the Northern District of Texas and Paul Kaufman of the Eastern District of Pennsylvania.

The claims resolved by the settlement are allegations only and there has been no determination of liability.

An Illinois man was sentenced to 29 months in prison today for using stolen identities to file false tax returns.

According to court documents and statements made in court, Wilmer Alexander Garcia Meza, of Waukegan, used others’ personal identifying information — including their names, dates of birth and identification documents such as foreign passports — to fraudulently obtain Individual Taxpayer Identification Numbers (ITINs) from the IRS. An ITIN is a tax processing number issued by the IRS to individuals who do not have, and are not eligible to obtain, a Social Security number. From 2013 through 2017, Garcia used the ITINs to file tax returns in the name of the stolen identities, claiming thousands of dollars in fraudulent refunds. Garcia then used identification documents in those same names to cash the refund checks issued by the IRS. In total, Garcia caused a tax loss of approximately $221,923.

In addition to the term of imprisonment, U.S. District Judge Elaine E. Bucklo ordered Garcia Meza to serve three years of supervised release and to pay approximately $221,923 in restitution to the United States.

Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division made the announcement.

IRS-Criminal Investigation investigated the case.

Trial Attorneys Thomas Flynn and Jacob Green of the Tax Division prosecuted the case. Former Trial Attorneys Michael Landman and Eric Schmale of the Tax Division provided valuable assistance on the case.

Today, the men and women of the Department of Justice and our criminal justice system delivered justice. Today, we remember the four Americans for whom it was delivered: James Foley, Kayla Mueller, Steven Sotloff, and Peter Kassig. Each was in Syria serving others when they were taken hostage and murdered by ISIS—James and Steven were there to report on the brutality of ISIS and Kayla and Peter to help those suffering under its rule. They were targeted and ultimately murdered because they stood for the very principle ISIS feared the most: freedom.

The sentence imposed today brings to a close a long investigation of a barbaric enemy, but it does not erase the heartbreak of the Foley, Mueller, Sotloff, and Kassig families. For years, I have personally witnessed and been inspired by their strength and resolve to seek accountability for the horrors their loved ones were forced to suffer and to improve and shape the policy of their government so that other families might not endure the same pain. Their relentless pursuit of justice, in the face of unimaginable pain, has inspired the men and women of the Department of Justice—namely the FBI, the U.S. Attorney’s Office for the Eastern District of Virginia, and the National Security Division—to investigate and prosecute this case with the same determination.

Today is a reminder of the Justice Department’s unshakeable commitment to combatting terrorism around the world. It should also serve as a warning to those who dare to threaten Americans that, no matter where you hide or how long it takes, we will find you, and we will bring you to justice.

A Jamaican man pleaded guilty in Miami federal court today to participating in a lottery fraud scheme targeting elderly victims in the United States.

According to court documents, Greg Warren Clarke, 29, of Montego Bay, Jamaica, pleaded guilty to one count of conspiracy to commit mail and wire fraud for his role in a Jamaica-based fraudulent lottery scheme that convinced American victims – many of whom were elderly – to pay money to collect fictitious lottery winnings. An indictment was filed against Clarke in the U.S. District Court for the Southern District of Florida in April 2019 and unsealed upon his extradition to the United States, which occurred in May 2022. 

“This guilty plea demonstrates the Justice Department’s dedication to prosecuting those responsible for fraudulent lottery schemes, even when they commit their crimes from foreign countries,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “We will continue to aggressively combat scams that seek to prey on older Americans.”

“The U.S. Postal Inspection Service stands ready to stop overseas criminals from illegally enriching themselves by using the mail to defraud consumers in the United States,” said Acting Inspector in Charge Juan Vargas of the U.S. Postal Inspection Service Miami Division. “We will continue to work with foreign governments to track down these criminals and bring them to justice.”

As part of his guilty plea, Clarke admitted that, from in or around September 2013, through in or around August 2015, he worked with co-conspirators, including Claude Anthony Shaw, in a scheme to defraud in which victims were called and falsely told that they had won over a million dollars in a lottery and needed to pay fees or taxes to claim their winnings. Victims were instructed to send their money through wire transfers or the mail to Shaw and other individuals. Clarke further admitted that, as part of the conspiracy, he and Shaw discussed (over the phone and through cell phone text messages) plans to receive victims’ money. At Clarke’s direction, Shaw received money from victims through wire transfers and the mail. Clarke further admitted that he and Shaw discussed arrangements for victims to send money to other individuals with whom Shaw worked. Clarke then instructed Shaw to send the victims’ money to Clarke in Jamaica, usually through wire transfers. Victims who sent money to Clarke and his co-conspirators never received any lottery winnings.

Shaw previously pleaded guilty to mail fraud in the U.S. District Court in Fort Lauderdale. In June 2017, he was sentenced to 36 months in prison. 

Clarke is scheduled to be sentenced on Oct. 28.

Senior Trial Attorney Arturo DeCastro of the Civil Division’s Consumer Protection Branch is prosecuting this case. The U.S. Postal Inspection Service investigated the case. 

The department’s extensive and broad-based efforts to combat elder fraud seek to halt the widespread losses seniors suffer from fraud schemes. The best method for prevention, however, is by sharing information about the various types of elder fraud schemes with relatives, friends, neighbors and other seniors who can use that information to protect themselves.

If you or someone you know is age 60 or older and has been a victim of financial fraud, help is available at the National Elder Fraud Hotline: 1-833-FRAUD-11 (1-833-372-8311). This Department of Justice hotline, managed by the Office for Victims of Crime, is staffed by experienced professionals who provide personalized support to callers by assessing the needs of the victim and identifying relevant next steps. Case managers will identify appropriate reporting agencies, provide information to callers to assist them in reporting, connect callers directly with appropriate agencies and provide resources and referrals, on a case-by-case basis. Reporting is the first step. Reporting can help authorities identify those who commit fraud, and reporting certain financial losses due to fraud as soon as possible can increase the likelihood of recovering losses. The hotline is open Monday through Friday from 10:00 a.m. to 6:00 p.m. ET. English, Spanish and other languages are available.

Additional information about the Consumer Protection Branch and its enforcement efforts may be found at www.justice.gov/civil/consumer-protection-branch. Information about the Department of Justice’s Elder Fraud Initiative is available at www.justice.gov/elderjustice.

A federal jury in the District of Columbia convicted the former Director of Operations of the U.S. Navy’s Military Sealift Command Office in Busan, South Korea, today for his role in a bribery conspiracy and for lying to federal investigators.

According to court documents and evidence presented at trial, Fernando Xavier Monroy, 64, of Brentwood, New York, engaged in a conspiracy to commit bribery with the owner of DK Marine, a South Korea-based company that provided services to the U.S. Navy, and a former civilian U.S. Navy cargo ship captain. Evidence at trial proved that Monroy conspired to unlawfully provide services for the Navy ship, captained by one of Monroy’s co-conspirators, during a December 2013 port visit in Chinhae, South Korea.

Evidence at trial also proved that Monroy provided a co-conspirator with confidential and other proprietary, internal U.S. Navy information. In exchange for the steering of business and the provision of such information, the co-conspirator paid bribes to Monroy, including cash, personal travel expenses, meals and alcoholic beverages, and the services of prostitutes. Monroy also repeatedly lied to special agents of the Defense Criminal Investigative Service (DCIS) and Naval Criminal Investigative Service (NCIS) during a voluntary interview in July 2019.

Monroy was convicted of conspiracy to commit bribery, bribery, and making false statements. He is scheduled to be sentenced on Nov. 18 and faces a maximum penalty of 25 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division made the announcement.

The DCIS and NCIS investigated the case.

Trial Attorneys Sara Hallmark and Amanda Lingwood of the Justice Department’s Fraud Section are prosecuting the case.

The Department of Justice today announced 56 awards totaling $35.7 million in funding from the Office on Violence Against Women (OVW) as part of the Department’s ongoing efforts to provide direct support and related assistance to victims of sexual assault. Announced in conjunction with the National Sexual Assault Conference, the Sexual Assault Services Formula Grant Program (SASP) awards include funding for each U.S. state, five U.S. territories, and the District of Columbia.

“For nearly two decades, the Justice Department’s Sexual Assault Services Program has demonstrated our commitment to providing comprehensive support to survivors of sexual assault,” said Attorney General Merrick B. Garland. “This grant funding will go directly toward strengthening the efforts of agencies and organizations across the country to provide critical services and care that survivors need and deserve.”

“Over the next year, this SASP grant funding will help tens of thousands of survivors of sexual violence access essential services,” said OVW Acting Director Allison Randall. “It is fitting to announce these awards today: SASP funding helps sexual assault survivors from every walk of life access medical care, crisis intervention, advocacy and counseling, among other services. I am so grateful to the direct service providers who ensure these services are available to survivors and provide trauma-informed care on a daily basis.”

SASP was first authorized by Congress in 2005 and is the nation’s first federal funding stream solely dedicated to providing direct intervention and related assistance to victims of sexual assault. OVW administers SASP funding according to a statutorily determined, population-based formula. States and territories, in turn, subaward the funds to rape crisis centers and other nonprofit, nongovernmental or Tribal agencies that provide direct intervention and related services to adult, youth and child victims of sexual assault.

OVW provides leadership in developing the nation’s capacity to reduce violence through the implementation of the Violence Against Women Act and subsequent legislation. Created in 1995, OVW administers financial and technical assistance to communities across the country that are developing programs, policies and practices aimed at ending domestic violence, dating violence, sexual assault and stalking. In addition to overseeing federal grant programs, OVW undertakes initiatives in response to special needs identified by communities facing acute challenges. Learn more at www.justice.gov/ovw.

A New York woman was arrested today, following an indictment returned by the grand jury earlier this week charging her with filing false tax returns, obstructing the IRS, and willful failure to file tax returns.

According to the indictment, Ehrenfriede Kauapirura, of Brooklyn, filed a false 2015 amended tax return and a false 2016 tax return. On both returns, Kauapirura allegedly reported hundreds of thousands of dollars in fictitious tax withholdings, which purportedly entitled her to refunds of approximately $250,000 for each year. After allegedly determining that Kauapirura’s claims were fraudulent, the IRS began a collections proceeding to recoup the refunds paid out to Kauapirura. To thwart the IRS’s collection efforts, Kauapirura allegedly transferred money from her personal bank account to a bank account owned by a trust that she controlled. Kauapirura also allegedly submitted a bogus $1 million check drawn on a non-existent bank as payment of her tax obligations. In addition, Kauapirura allegedly did not timely file individual tax returns with the IRS for the years 2017 through 2020.

If convicted, Kauapirura faces up to three years in prison for each count of filing false tax returns, three years in prison for obstructing the IRS, and one year in prison for each of four counts of willful failure to file a tax return. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division, U.S. Attorney Breon Peace for the Eastern District of New York and Special Agent in Charge Tammy Tomlins Sarah of IRS-Criminal Investigation made the announcement.

IRS-Criminal Investigation is investigating the case.

Trial Attorneys Michael C. Vasiliadis and Kenneth C. Vert of the Tax Division are prosecuting the case.

An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

The Department of Justice and the Federal Trade Commission yesterday submitted to the Federal Energy Regulatory Commission (FERC) a joint comment urging it not to restore a right of first refusal that would enable incumbent electricity transmission owners to block competitors from bidding to design, construct, and own certain new interstate transmission facilities.

The FERC is considering reinstating the right of first refusal, or ROFR – which was eliminated in certain instances in 2011 – as long as incumbent transmission owners agree to a joint ownership structure with one or more unaffiliated, non-incumbent partners. FERC issued a Notice of Proposed Rulemaking on April 21, 2022. This could mean that the design and construction of certain transmission facilities is less competitive, resulting in higher prices or lower quality. 

“We commend FERC for undertaking this rulemaking, which is aimed at encouraging needed regional transmission planning and construction,” said Assistant Attorney General Jonathan Kanter of the Justice Department’s Antitrust Division. “The rulemaking comes at a critical time, when the nation is undertaking major grid modernization efforts, and competition can make transmission design and construction less costly, more resilient, and more innovative for the American consumer. Thus, we urge FERC not to abandon competition, through the reinstatement of a federal right of first refusal, but to first evaluate the effects of its other proposals, which are consistent with competition, on achieving its goals.”

The joint comment addresses the benefits and importance of competition and new entry for the design and construction of interstate electric transmission facilities. These facilities are necessary to ensure robust wholesale electricity markets and interconnect renewable generation facilities. The comment notes that when FERC eliminated the ROFR under certain circumstances in 2011, it recognized the benefits to consumers of having competition for transmission design and construction. The comment urges FERC not to abandon competition, and it cites examples of where competition for transmission design and construction has resulted in lower costs and innovation.

The comment also supports proposals made in FERC’s Notice of Proposed Rulemaking to require that regional transmission planning be done on a sufficiently long-term basis, that planning involve state regulators to reduce disputes over cost allocation, that transmission planning for local projects be more transparent, and that neighboring utilities improve their interregional coordination. The comment also notes other procompetitive solutions offered by stakeholders in the ongoing proceeding, including creating an independent transmission monitor (or regional monitors) to limit the influence of incumbent utilities over the planning process.

FORT WAYNE – Sterling Bastin, 56 years old, of Wawaka, Indiana, was sentenced by United States District Court Judge Holly A. Brady on his plea of guilty to distribution of methamphetamine, announced United States Attorney Clifford D. Johnson.

Bastin was sentenced to a total of 168 months in prison followed by 5 years of supervised release.

According to documents in the case, in December 2020, and February 2021, Bastin sold over 140 grams of methamphetamine to another individual.  In May 2021, law enforcement initiated a traffic stop of the vehicle Bastin was driving.  However, he disregarded emergency lights and sirens, fled from law enforcement at speeds of 100 mph, lost control of his vehicle and spun out into a ditch, striking a stop sign.  Officers seized an additional 3.5 grams of methamphetamine as well as a digital scale from his vehicle.   

This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Drug Enforcement Administration with the assistance of the Auburn Police Department, the Dekalb County Sheriff’s Department and the Butler Police Department.  The case was prosecuted by Assistant United States Attorney Brent A. Ecenbarger.

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results

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A Missouri man was indicted yesterday for allegedly leaving a voicemail containing a threat on the personal cell phone of an election official in the Maricopa County Recorder’s Office in Maricopa County, Arizona.

Walter Lee Hoornstra, 50, of Tecumseh, is charged with one count of communicating an interstate threat and one count of making a threatening telephone call.

“These unlawful threats of violence endanger election officials, undermine our electoral process, and threaten our democracy,” said Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division. “The department’s Election Threats Task Force, working with our partners across the country, remains committed to investigating and prosecuting such illegal threats to ensure that these public servants are able to do their jobs free from intimidation.”

According to the indictment, on or about May 19, 2021, Hoornstra allegedly left the following voicemail message on the personal cell phone of the election official: “So I see you’re for fair and competent elections, that’s what it says here on your homepage for your recorder position you’re trying to fly here. But you call things unhinged and insane lies when there’s a forensic audit going on. You need to check yourself. You need to do your [expletive] job right because other people from other states are watching your ass. You [expletive] renege on this deal or give them any more troubles, your ass will never make it to your next little board meeting.”

“The FBI is committed to vigorously investigating and holding accountable anyone who threatens election workers,” said Assistant Director Luis Quesada of the FBI’s Criminal Investigative Division. “These public servants protect our fundamental right to vote by administering fair and free elections. Any attempts to interfere with our elections by intimidating election officials, their staffs, and volunteers with threats of violence will not be tolerated.”

If convicted, Hoornstra faces up to five years in prison for making a threatening interstate communication and up to two years in prison for making a threatening telephone call. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

FBI Phoenix is investigating the case.

Trial Attorney Tanya Senanayake of the Criminal Division’s Public Integrity Section is prosecuting the case.

Substantial assistance was provided by the U.S. Attorney’s Office for the District of Arizona and the U.S. Attorney’s Office for the Western District of Missouri.

This case is part of the Justice Department’s Election Threats Task Force. Announced by Attorney General Merrick B. Garland and launched by Deputy Attorney General Lisa O. Monaco in June 2021, the Task Force has led the department’s efforts to address threats of violence against election workers, and to ensure that all election workers — whether elected, appointed, or volunteer — are able to do their jobs free from threats and intimidation. The Task Force engages with the election community and state and local law enforcement to assess allegations and reports of threats against election workers, and has investigated and prosecuted these matters where appropriate, in partnership with FBI field offices and U.S. Attorneys’ Offices throughout the country. A year after its formation, the Task Force is continuing this work and supporting the United States Attorneys’ Offices and FBI Field Offices nationwide as they carry on the critical work that the Task Force has begun. 

Under the leadership of Deputy Attorney General Monaco, the Task Force is led by the Criminal Division’s Public Integrity Section and includes several other entities within the Department of Justice, including the Computer Crime and Intellectual Property Section of the Criminal Division, the Civil Rights Division, the National Security Division, and the FBI, as well as key interagency partners, such as the Department of Homeland Security and the U.S. Postal Inspection Service. For more information regarding the Justice Department’s efforts to combat threats against election workers, read the Deputy Attorney General’s memo.

To report suspected threats or violent acts, contact your local FBI office and request to speak with the Election Crimes Coordinator. Contact information for every FBI field office may be found here: https://www.fbi.gov/contact-us/field-offices/. You may also contact the FBI at 1-800-CALL-FBI (225-5324) or file an online complaint at: tips.fbi.gov. Complaints submitted will be reviewed by the task force and referred for investigation or response accordingly. If someone is in imminent danger or risk of harm, contact 911 or your local police immediately.

An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law

An alleged cryptocurrency money launderer was extradited this week from the Netherlands to the United States to face charges in the District of Oregon.

Denis Mihaqlovic Dubnikov, 29, a Russian citizen, made his initial appearance in federal court today in Portland. A five-day jury trial is scheduled to begin on Oct. 4.

According to court documents, Dubnikov and his co-conspirators laundered the proceeds of ransomware attacks on individuals and organizations throughout the United States and abroad. Specifically, Dubnikov and his accomplices laundered ransom payments extracted from victims of Ryuk ransomware attacks.

After receiving ransom payments, Ryuk actors, Dubnikov and his co-conspirators, and others involved in the scheme, allegedly engaged in various financial transactions, including international financial transactions, to conceal the nature, source, location, ownership, and control of the ransom proceeds.

In July 2019, Dubnikov allegedly laundered more than $400,000 in Ryuk ransom proceeds. Those involved in the conspiracy laundered at least $70 million in ransom proceeds.

If convicted, Dubnikov faces a maximum sentence of 20 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

First identified in August 2018, Ryuk is a type of ransomware software that, when executed on a computer or network, encrypts files and attempts to delete any system backups. Of note, Ryuk can target storage drives contained within or physically connected to a computer, including those accessible remotely via a network connection. Ryuk has been used to target thousands of victims worldwide across a variety of sectors. In October 2020, law enforcement officials specifically identified Ryuk as an imminent and increasing cybercrime threat to hospitals and healthcare providers in the United States.

The FBI’s Portland Field Office is investigating the case.

The Justice Department’s Office of International Affairs handled Dubnikov’s extradition.

Justice Department components who worked on this seizure coordinated their efforts through the department’s Ransomware and Digital Extortion Task Force, which was created to combat the growing number of ransomware and digital extortion attacks.

The Task Force prioritizes the disruption, investigation, and prosecution of ransomware and digital extortion activity by tracking and dismantling the development and deployment of malware, identifying the cybercriminals responsible, and holding those individuals accountable for their crimes. The Task Force also strategically targets the ransomware criminal ecosystem as a whole and collaborates with domestic and foreign government agencies as well as private sector partners to combat this significant criminal threat.

An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

The Justice Department announced today that it will monitor the Aug. 16, 2022, federal primary election in certain jurisdictions in the State of Alaska to ensure compliance with the minority language accessibility requirements of the Voting Rights Act of 1965 and the disability accessibility requirements of the Americans with Disabilities Act of 1990. On election day, the Civil Rights Division will be monitoring in the following jurisdictions: Municipality of Anchorage, City and Borough of Juneau, Bethel Census Area, Dillingham Census Area and Kusilvak Census Area. During early/absentee voting, the Division has also monitored in the following jurisdictions:  Municipality of Anchorage, City and Borough of Juneau, Kenai Peninsula Borough, Matanuska-Susitna Borough, Denali Borough, Fairbanks North Star Borough and Yukon-Koyukuk Census Area.

The Division regularly deploys its staff to monitor for compliance with the federal civil rights laws in elections in communities all across the country. In addition, the Division also deploys monitors from the Office of Personnel Management, where authorized by federal court order. 

Individuals can file complaints related to possible violations of the federal voting rights laws by a complaint form on the department’s website https://civilrights.justice.gov/ or by telephone toll-free at 800-253-3931.

Individuals with questions or complaints related to the ADA may call the department’s toll-free ADA information line at 800-514-0301 or 800-514-0383 (TDD), or submit a complaint through a link on the department’s ADA website, at https://www.ada.gov/.

Visit https://www.justice.gov/crt/voting-section for more information about the Voting Rights Act and other federal voting rights laws. Visit https://www.ada.gov/ for more information about the Americans with Disabilities Act.

A 28-count indictment was unsealed today in the Eastern District of California charging a former member of Congress with multiple fraud schemes and campaign contribution fraud.

Terrance John “TJ” Cox, 59, of Fresno, is charged with 15 counts of wire fraud, 11 counts of money laundering, one count of financial institution fraud, and one count of campaign contribution fraud. 

According to allegations in the indictment, Cox perpetrated multiple fraud schemes targeting companies he was affiliated with and their clients and vendors. Cox created unauthorized off-the-books bank accounts and diverted client and company money into those accounts through false representations, pretenses and promises. From 2013 to 2018, across two different fraud schemes, Cox illicitly obtained over $1.7 million in diverted client payments and company loans and investments he solicited and then stole.

In addition, Cox allegedly received mortgage loan funds from a lender for a property purchase by submitting multiple false representations to the lender, including fabricated bank statements and false statements that Cox intended to live in the property as his primary residence. However, the indictment alleges Cox intended to and did buy the property to rent it to someone else.

According to allegations in the indictment, Cox also fraudulently obtained a $1.5 million construction loan to develop the recreation area in Fresno known as Granite Park. Cox and his business partner’s nonprofit could not qualify for the construction loan without a financially viable party guaranteeing the loan. Cox falsely represented that one of his affiliated companies would guarantee the loan, and submitted a fabricated board resolution which falsely stated that at a meeting on a given date all company owners agreed to guarantee the Granite Park loan. No meeting took place, and the other owners did not agree to back the loan. The loan later went into default causing a loss of more than $1.28 million.

According to allegations in the indictment, when Cox was a candidate for the U.S. House of Representatives in the 2018 election, he perpetrated a scheme to fund and reimburse family members and associates for donations to his campaign. Cox arranged for over $25,000 in illegal straw or conduit donations to his campaign in 2017.

If convicted, C ox faces a maximum statutory penalty of 20 years in prison and a $250,000 fine for wire fraud and money laundering. He faces a maximum statutory penalty of 30 years in prison and a $1 million fine for wire fraud affecting a financial institution and financial institution fraud. He faces a maximum statutory penalty of five years in prison and a $250,000 fine for campaign contribution fraud. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

U.S. Attorney Phillip A. Talbert of the Eastern District of California made the announcement.

The FBI and IRS Criminal Investigation are investigating the case.

Assistant U.S. Attorneys Henry Z. Carbajal III and Jeffrey A. Spivak are prosecuting the case.

An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

Universal Helicopters Inc. (UHI), a private helicopter flight instructor training company, and Dodge City Community College (DC3), which operates campuses in Dodge City, Kansas, and Chandler, Arizona, have agreed to pay $7.5 million to resolve allegations that they violated the False Claims Act by making false statements to the U.S. Department of Veterans Affairs (VA) in connection with the helicopter flight instructor training program jointly run by UHI and DC3.

The VA provided financial assistance as part of the Post-9/11 GI Bill to veterans taking classes at the UHI-DC3 helicopter flight instructor program. The United States alleged that from 2013 to 2018, UHI and DC3 made or caused to be made false statements to the VA regarding enrollment in the UHI-DC3 helicopter flight instructor program in order to obtain VA funding. UHI has agreed to pay $7 million and DC3 has agreed to pay $500,000 to settle these allegations. The settlement with DC3 is based on its ability to pay.

“The Post-9/11 GI Bill provides significant educational opportunities to our nation’s veterans,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “The department will continue to help safeguard the integrity of VA programs intended for the advancement and benefit of veterans.”

“One of the ways the U.S. government demonstrates gratitude to our veterans is by creating programs intended to create easier paths to accessing higher education,” said U.S. Attorney Duston Slinkard for the District of Kansas. “It’s disheartening that any institution of higher learning would submit inaccurate information in order to improperly receive funds designed to benefit those who serve our nation.”

“This case demonstrates the VA Office of Inspector General’s (OIG) commitment to aggressively pursue schools who target veterans’ education benefits,” said Special Agent in Charge Rebeccalynn Staples of the VA OIG’s Western Field Office. “The VA OIG will continue to work with its law enforcement partners to protect the integrity of VA’s education benefits program and urges anyone with knowledge of possible fraud against VA to contact the OIG’s hotline at 1-800-488-8244.”

As part of the Post-9/11 GI Bill program, the VA provides tuition and fee payments directly to qualifying schools on behalf of eligible veterans. To qualify for the program, among other things, a school is required to certify to the VA that no more than 85 percent of the students for any particular course are receiving VA benefits. This requirement, commonly referred to as the “85/15 Rule,” is intended to prevent abuse of Post-9/11 GI Bill funding by ensuring that the VA is paying fair market value tuition rates since at least 15 percent of the enrolled students would be paying the same rate with non-VA funds. To determine whether it is in compliance with the 85/15 Rule, a school compares the full-time non-VA supported students enrolled in a particular course to the full-time veteran students enrolled in that same course. A separate ratio must be computed for each course of study.

The settlements resolve allegations that from 2013 to 2018, UHI and DC3 falsely certified compliance with the 85/15 Rule when the UHI-DC3 helicopter flight instructor program included certain expensive classes that were taken almost exclusively by veterans. In addition, in its settlement with DC3, the United States alleged that to reach the required 15 percent threshold, DC3 counted part-time students enrolled in only one online class per semester as full-time students, in violation of VA rules.

The civil settlements include the resolution of claims brought under the qui tam or whistleblower provisions of the False Claims Act by William Rowe, a veteran and former student in the UHI-DC3 helicopter flight instructor program. Under those provisions, a private party can file an action on behalf of the United States and receive a portion of any recovery. The qui tam case is captioned United States ex rel. Rowe v. Dodge City Community College, et al., No. 18-cv-01113-TC-GEB (D. Kan.). Rowe will receive $1.125 million as his share of the settlements.

The resolution obtained in this matter was the result of a coordinated effort between the Justice Department’s Civil Division Commercial Litigation Branch, Fraud Section, and the U.S. Attorney’s Office for the District of Kansas, with assistance from the VA OIG and the Veterans Benefits Administration, Education Service.

Trial Attorney Jonathan Thrope and Assistant U.S. Attorney Jon Fleenor for the District of Kansas prosecuted the matter.

The claims resolved by the settlements are allegations only and there has been no determination of liability.

A federal jury in the Southern District of Ohio convicted an Ohio physician on Friday for unlawfully distributing opioids from his Martin’s Ferry clinic.

According to court documents and evidence presented at trial, Thomas Romano, 72, of Wheeling, West Virginia, owned and operated a self-named pain management clinic where his clients traveled hundreds of miles to obtain prescriptions for opioids and other controlled substances. For his opioid and other controlled substance prescriptions, Romano only accepted cash—$750 for an initial prescription and $120 for subsequent monthly prescriptions. The evidence offered at trial demonstrated that the prescriptions Romano issued for opioids and other controlled substances greatly exceeded recommended dosages and were in dangerous, life-threatening combinations which served to fuel the addiction of his clients. According to evidence introduced at trial, between January 2015 and June 2019, Romano prescribed over 111,000 pills, including opioids, benzodiazepines, and muscle relaxants, to nine of his clients.

Romano was convicted of 24 counts of unlawful distribution of a controlled substance, outside the usual course of professional practice, and not for a legitimate medical purpose to these nine clients. He faces a maximum penalty of 20 years in prison for each charge. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors. A sentencing date has not yet been set.

Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division; U.S. Attorney for the Southern District of Ohio Kenneth L. Parker; Special Agent in Charge J. William Rivers of the FBI Cincinnati Field Office; Special Agent in Charge Orville O. Greene of the DEA’s Detroit Division; and Special Agent in Charge Mario M. Pinto of the Department of Health and Human Service Office of the Inspector General (HHS-OIG) made the announcement.

The DEA, FBI, and HHS-OIG, as well as the Ohio Bureau of Worker’s Compensation and Ohio Board of Pharmacy, investigated this case.

Acting Assistant Chief Andrew B. Barras and Trial Attorney Christopher Jason of the Criminal Division’s Fraud Section are prosecuting the case.

The FBI, working with its state and local partners during two weeks in August, identified and located 84 minor victims of child sex trafficking and child sexual exploitation offenses and located 37 actively missing children during a nationwide enforcement campaign, dubbed “Operation Cross Country.”

“The Justice Department is committed to doing everything in our power to combat the insidious crimes of human trafficking that devastate survivors and their families,” said Attorney General Merrick B. Garland. “I am grateful to the dedicated professionals of the FBI and our law enforcement partners across the country for their tireless work to rescue trafficking survivors, including exploited children, to investigate and prosecute the perpetrators of trafficking crimes, and to provide the services and support that survivors need and deserve.”

The FBI-led nationwide initiative focused on identifying and locating victims of sex trafficking and investigating and arresting individuals and criminal enterprises involved in both child sex and human trafficking.

"Human trafficking is among the most heinous crimes the FBI encounters,” said FBI Director Christopher Wray. “Unfortunately, such crimes—against both adults and children—are far more common than most people realize. As we did in this operation, the FBI and our partners will continue to find and arrest traffickers, identify and help victims, and raise awareness of the exploitation our most vulnerable populations.”

In addition to the identification and location of adolescent victims, the FBI and its partners located 141 adult victims of human trafficking. Agents and investigators also identified or arrested 85 suspects of child sexual exploitation and human trafficking offenses. Those suspects identified will be subject to additional investigation for potential chargers. The average age of victims located in similar operations is approximately 15.5 years old, while the youngest victim discovered during this operation was 11 years old.  

As part of Operation Cross Country XII, FBI special agents, intelligence analysts, victim specialists, and child adolescent forensic Interviewers working in conjunction with 200 state, local, and federal partners and the National Center for Missing and Exploited Children (NCMEC) conducted 391 operations over the two-week period. 

“The success of Operation Cross County reinforces what NCMEC sees every day. Children are being bought and sold for sex in communities across the country by traffickers, gangs and even family members,” said Michelle DeLaune, President and CEO National Center for Missing & Exploited Children “We’re proud to support the FBI’s efforts to prioritize the safety of children.  This national operation highlights the need for all child serving professionals to continue to focus on the wellbeing of children and youth to prevent them being targeted in the first place.” 

Victim specialists provide a “bridge” for victims who are wary of the system, help the victim establish positive relationships with law enforcement, and ensure the human trafficking victim population receives any appropriate resources available to them. Victim specialists also provide services based on the individual needs of human trafficking victims, to include crisis intervention, emergency food and clothing, transportation to receive emergency services, and locating shelter or housing. The task forces in the recent operation included federal, state, local and tribal partners, with efforts in every state and even a few U.S. territories.

Resources: 

• Victim Services Division
• Crimes Against Children
• Department of Justice Child Exploitation and Obscenity Section
• Operation Cross Country 2022

Three Nigerian citizens were extradited from the United Kingdom (UK) and arrived in the United States in relation to their alleged participation in multimillion-dollar cyber-enabled business email compromise (BEC) fraud schemes in the Western District of North Carolina, Southern District of Texas and Eastern District of Virginia. The scams allegedly perpetrated by the defendants and their co-conspirators targeted unsuspecting victims including universities in North Carolina, Texas and Virginia, and attempted to cause more than $5 million in losses.

BEC, also known as “cyber-enabled financial fraud,” is a sophisticated scam often targeting employees with access to company finances, businesses working with foreign suppliers and/or businesses that regularly perform wire transfer payments. The same criminal organizations that perpetrate BEC also exploit individual victims, often real estate purchasers, the elderly, and others, by convincing them to make wire transfers to bank accounts controlled by the criminals. This is often accomplished by impersonating a key employee or business partner after obtaining access to that person’s email account or sometimes done through romance and lottery scams. BEC scams may involve fraudulent requests for checks rather than wire transfers; they may target sensitive information such as personally identifiable information (PII) or employee tax records instead of, or in addition to, money; and they may not involve an actual “compromise” of an email account or computer network. Foreign citizens perpetrate many BEC scams. Those individuals are often members of transnational criminal organizations, which originated in Nigeria but have spread throughout the world.

Western District of North Carolina

Oludayo Kolawole John Adeagbo aka John Edwards and John Dayo, 43, a Nigerian citizen and UK resident, and Donald Ikenna Echeazu aka Donald Smith and Donald Dodient, 40, a dual UK and Nigerian citizen, are charged with wire fraud conspiracy, money laundering conspiracy and aggravated identity theft for defrauding a North Carolina university (the University) of more than $1.9 million via a business email compromise scheme. The indictment was returned by a federal grand jury in the Western District of North Carolina on April 17, 2019, and was unsealed yesterday following Echeazu’s initial appearance in federal court in Charlotte.

According to allegations contained in the indictment, from Aug. 30, 2016, to Jan. 12, 2017, Adeagbo and Echeazu conspired with other individuals to obtain information about significant construction projects occurring throughout the United States, including an ongoing multi-million-dollar project at the victim University. To execute the scheme, the defendants allegedly registered a domain name similar to that of the legitimate construction company in charge of the University’s project and created an email address that closely resembled that of an employee of the construction company. Using the fake email address, the co-conspirators allegedly deceived and directed the University to wire a payment of more than $1.9 million to a bank account controlled by an individual working under the direction of defendants. Upon receiving the payment, the co-conspirators allegedly laundered the stolen proceeds through a series of financial transactions designed to conceal the fraud.

The wire fraud conspiracy charge and the money laundering conspiracy charge each carry a maximum statutory sentence of 20 years in prison. The aggravated identity theft charge carries a mandatory two-year prison sentence consecutive to any other term imposed.

The FBI Charlotte Field Office conducted the investigation. Assistant U.S. Attorney Graham Billings of the Western District of North Carolina is prosecuting the case.

Southern District of Texas

Oludayo Kolawole John Adeagbo aka John Edwards and John Dayo, 43, a Nigerian citizen and UK resident, is also charged in the Southern District of Texas with conspiracy to commit wire fraud and wire fraud. A federal grand jury returned the indictment March 30, 2022, which was unsealed on Aug. 3, 2022 before he was extradited to the United States. 

From November 2016 until July 2018, Adeagbo allegedly conspired with others to participate in cyber-enabled business email compromises in an attempt to steal more than $3 million from victims in Texas, including local government entities, construction companies and a Houston-area college. The indictment alleges Adeagbo and his co-conspirators registered domain names that looked similar to legitimate companies. They then sent emails from those domains pretending to be employees at those companies, according to the charges. The conspirators allegedly sent emails to clients or customers of the companies they impersonated and deceived those customers into sending wire payments to bank accounts they controlled.

Adeagbo faces up to 20 years in prison, if convicted on the charges.

The FBI Houston Cyber Task Force conducted the investigation with the assistance of the FBI Cyber and Criminal Investigative Divisions. The United Kingdom’s National Crime Agency, Metropolitan Police Service, City of London Police and Crown Prosecution Service also provided substantial assistance. Assistant U.S. Attorney Rodolfo Ramirez for the Southern District of Texas is prosecuting the case along with Trial Attorney Brian Mund of the Justice Department’s Criminal Division Computer Crime and Intellectual Property Section (CCIPS).

Eastern District of Virginia

Olabanji Egbinola, 42, is charged with wire fraud, conspiracy to commit wire fraud, money laundering, and conspiracy to commit money laundering.

According to a criminal complaint issued by the U.S. District Court for the Eastern District of Virginia, from Sept. 26, 2018, to Dec. 26, 2018, Egbinola is alleged to have conspired with others to defraud a Virginia-based university. Egbinola and co-conspirators created and used a fraudulent email account that incorporated the name of a construction company that had a large, ongoing contract with the university. Using this email account, Egbinola and co-conspirators deceived the university into transferring $469,819.49 to a bank account controlled by Egbinola and co-conspirators. That money was quickly laundered and transferred overseas through numerous transactions. Evidence obtained during the investigation showed that Egbinola repeatedly accessed the email account used to defraud the Virginia university.

The FBI Richmond Division conducted the investigation. Assistant U.S. Attorney Brian Hood of for the Eastern District of Virginia is prosecuting the case.

All three defendants were arrested April 23, 2020, by UK authorities at the request of the United States and ordered extradited on Sept. 3, 2021. All three defendants filed appeals, all of which were rejected by the UK High Court on July 12, 2022.

The Justice Department’s Office of International Affairs provided substantial assistance in securing the arrest and extradition of all three defendants. The U.S. Marshals Service also assisted by transporting the defendants from the UK to the United States.

Victims are encouraged to file a complaint online with the IC3 at bec.ic3.gov. The IC3 staff reviews complaints, looking for patterns or other indicators of significant criminal activity, and refers investigative packages of complaints to the appropriate law enforcement authorities in a particular city or region. The FBI provides a variety of resources relating to BEC scams through the IC3, which can be reached at www.ic3.gov. For more information on BEC scams, visit: https://www.fbi.gov/scams-and-safety/common-scams-and-crimes/business-email-compromise.

The charges contained in an indictment are merely allegations, and the defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

A federal grand jury in the District of New Jersey returned an indictment today charging four New Jersey men with narcotics distribution and money laundering offenses.

According to court documents, William Panzera, 49, of North Heldon; Thomas Padovano, 48, of Newark; Bartholomew Padovano, 71, of Newark; and Sean Tighe, 46, of Kearny; are alleged members of a drug trafficking organization that sent money and digital currency to China to purchase fentanyl analogues, a schedule I controlled substance, and synthetic cathinones, a schedule I controlled substance, also known as “bath salts,” to distribute in the United States. In addition, Panzara set up a shell company to send funds to China to purchase fentanyl analogues. 

The defendants are alleged to have initially received approximately two to three kilograms of narcotics at a time, concealed in parcels sent through the mail, before they began importing larger quantities of narcotics. According to court documents, law enforcement intercepted and seized one of these shipments, which contained approximately 50 kilograms of 4-Fluoroisobutyrylfentanyl fentanyl or 4-FIBF, a controlled substance analogue of fentanyl. Law enforcement also seized an additional approximately 18 kilograms of 4-FIBF from a location in Newark, where the defendants had concealed the drugs received from a prior shipment from China.

As alleged in the indictment, the defendants pressed the fentanyl-related substances into pills that resembled commercial pharmaceutical products and sold them. The indictment also alleges that they made cash deposits into their bank accounts to conceal the earnings from their illegal drug trafficking activities. 

Defendant Panzara, Thomas Padovano, Bartholomew Padovano, and Tighe, were charged with drug trafficking conspiracy and international promotional money laundering conspiracy. Additionally, defendants Thomas Padovano and Bart Padovano were also charged with domestic concealment money laundering conspiracy. If convicted on the narcotics offenses in Count One, the defendants face a mandatory minimum sentence of 10 years and a maximum sentence of life imprisonment. If convicted on the money laundering offenses in Counts Two and Three, the defendants face a maximum sentence of 20 years in prison on each count. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors. 

Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division and U.S. Attorney Philip R. Sellinger made the announcement.

Homeland Security Investigations (HSI), with assistance from the U.S. Postal Inspection Service and the Federal Bureau of Investigation, are investigating the case.

Trial Attorneys Stephen Sola and Michael Khoo of the Justice Department’s Money Laundering and Asset Recovery Section, and Assistant U.S. Attorney Sammi Malek of the District of New Jersey are prosecuting the case. 

This prosecution is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) operation. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.

An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

A federal jury in the Northern District of Illinois convicted two former precious metals traders at JPMorgan Chase & Co. (JPMorgan) today of fraud, attempted price manipulation, and spoofing in a multi-year market manipulation scheme of precious metals futures contracts that spanned over eight years and involved thousands of unlawful trading sequences.

According to court documents and evidence presented at trial, Gregg Smith, 57, of Scarsdale, New York, was an executive director and trader on JPMorgan’s precious metals desk in New York. Michael Nowak, 47, of Montclair, New Jersey, was a managing director and ran JPMorgan’s global precious metals desk.

The evidence at trial showed that between approximately May 2008 and August 2016, the defendants, along with other traders on the JPMorgan precious metals desk, engaged in a widespread spoofing, market manipulation, and fraud scheme. The defendants placed orders that they intended to cancel before execution in order to drive prices on orders they intended to execute on the opposite side of the market. The defendants engaged in thousands of deceptive trading sequences for gold, silver, platinum, and palladium futures contracts traded through the New York Mercantile Exchange Inc. (NYMEX) and Commodity Exchange Inc. (COMEX), which are commodities exchanges operated by CME Group Inc. These deceptive orders were intended to inject false and misleading information about the genuine supply and demand for precious metals futures contracts into the markets.

“Today’s jury verdict demonstrates that those who seek to manipulate our public financial markets will be held accountable and brought to justice,” said Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division. “With this verdict, the Department has secured convictions of ten former traders at Wall Street financial institutions, including JPMorgan, Bank of America/Merrill Lynch, Deutsche Bank, The Bank of Nova Scotia, and Morgan Stanley. These convictions underscore the Department’s commitment to prosecuting those who undermine the investing public’s trust in the integrity of our commodities markets.”

“For years the defendants allegedly placed thousands of false orders for precious metals, creating a ruse that lured others into making disadvantageous trades” said Assistant Director Luis Quesada of the FBI’s Criminal Investigative Division. “Today’s conviction demonstrates that no matter how complex or long-running a scheme is, the FBI is committed to bringing those involved in crimes like this to justice.”

Following a three-week trial, Smith was convicted of one count of attempted price manipulation, one count of spoofing, one count of commodities fraud, and eight counts of wire fraud affecting a financial institution. Nowak was convicted of one count of attempted price manipulation, one count of spoofing, one count of commodities fraud, and 10 counts of wire fraud affecting a financial institution. Sentencing dates have not yet been set.

Two other former JPMorgan precious metals traders, John Edmonds and Christian Trunz, were previously convicted in related cases. In October 2018, Edmonds pleaded guilty in the District of Connecticut to one count of commodities fraud and one count of conspiracy to commit wire fraud, commodities fraud, price manipulation, and spoofing. In August 2019, Trunz pleaded guilty in the Eastern District of New York to one count of conspiracy to engage in spoofing and one count of spoofing. Edmonds and Trunz are awaiting sentencing.

In September 2020, JPMorgan admitted to committing wire fraud in connection with: (1) unlawful trading in the markets for precious metals futures contracts; and (2) unlawful trading in the markets for U.S. Treasury futures contracts and in the secondary (cash) market for U.S. Treasury notes and bonds. JPMorgan entered into a three-year deferred prosecution agreement through which it paid more than $920 million in a criminal monetary penalty, criminal disgorgement, and victim compensation, with parallel resolutions by the Commodity Futures Trading Commission and the Securities Exchange Commission announced on the same day.

The FBI’s New York Field Office investigated the case. The Commodity Futures Trading Commission’s Division of Enforcement provided assistance in this matter.

Market Integrity & Major Frauds Unit Chief Avi Perry and Trial Attorneys Matthew Sullivan, Lucy Jennings, and Christopher Fenton of the Criminal Division’s Fraud Section are prosecuting the case. 

Individuals who believe that they may be a victim in this case should visit the Fraud Section’s Victim Witness website at https://www.justice.gov/criminal-fraud/victim-witness-program for more information.

A federal jury in the Eastern District of Kentucky convicted a Louisiana man today for his attempted murder of a man at the direction of the violent prison gang, Aryan Circle.

Evidence presented at trial showed that Mitchell Farkas, aka Lifter, 52, of Baton Rouge, along with Johnathan Gober, stabbed another inmate, who the Aryan Circle believed had violated gang rules, while all were housed at federal prison U.S. Penitentiary (USP) Big Sandy in Martin County, Kentucky.

According to court documents and evidence presented at trial, the Aryan Circle is a violent, white-supremacist, prison gang with hundreds of members operating throughout the country, both inside and outside of prisons. The Aryan Circle enforces its rules and promotes discipline among its members, prospects, and associates through threats, intimidation, assaults, and murder.

The jury convicted Farkas of Violent Crimes in Aid of Racketeering (VICAR) attempted murder, VICAR assault with intent to do serious bodily harm, and attempted murder and assault with intent to do serious bodily harm. He is scheduled to be sentenced on Dec. 5 and faces a maximum penalty of 20 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Gober was sentenced on Dec. 21, 2021, to 10 years in prison.

The Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) investigated this case, with the assistance of the Federal Bureau of Prisons, the Texas Department of Public Safety, the Houston Police Department – Gang Division, and the Montgomery County (TX) Precinct One Constable’s Office.

Trial Attorney Rebecca Dunnan of the Justice Department’s Organized Crime and Gang Section and Assistant U.S. Attorney Gregory Rosenberg of the Eastern District of Kentucky are prosecuting the case.

New Trade Ship Management S.A. (New Trade), a vessel operating company, and vessel Chief Engineer Dennis Plasabas pleaded guilty today in San Diego, California, for maintaining false and incomplete records relating to the discharge of oily bilge water from the bulk carrier vessel Longshore.

New Trade and Plasabas admitted that oily bilge water was illegally dumped from the Longshore directly into the ocean without being properly processed through required pollution prevention equipment. Oily bilge water typically contains oil contamination from the operation and cleaning of machinery on the vessel. The defendants also admitted that these illegal discharges were not recorded in the vessel’s oil record book as required by law. Specifically, on two separate occasions between October and December 2021, Chief Engineer Plasabas, who was employed by New Trade, ordered lower-ranking crew members to use a portable pneumatic pump and hose to bypass pollution prevention equipment by transferring oily bilge water from the vessel’s bilge holding tank to the vessel’s sewage tank, from where it was discharged directly into the ocean. Plasabas then failed to record these improper transfers and overboard discharges in the vessel’s oil record book. Additionally, in order to create a false and misleading electronic record as if the pollution prevention equipment had been properly used, Plasabas directed lower-ranking crew members to pump clean sea water into the vessel’s bilge holding tank in the same quantity as the amount of oily bilge water that he had ordered transferred to the sewage tank. Plasabas then processed the clean sea water through the vessel’s pollution prevention equipment as if it was oily bilge water in order to make it appear that the pollution prevention equipment was being properly used when in fact it was not. The electronic records indicate that approximately 9,600 gallons of clean sea water were run through the pollution prevention equipment.  

“This case demonstrates our commitment to investigating and prosecuting environmental crimes occurring at sea, no matter how wrongdoers may try to cover them up,” said Assistant Attorney General Todd Kim of the Justice Department’s Environment and Natural Resources Division. “The Department of Justice will continue to work with our partner agencies to ensure polluters are held fully accountable.”   

“We are committed to protecting our environment from people who cause immeasurable harm with short cuts,” said U.S. Attorney Randy Grossman for the Southern District of California. “This was a very calculated plan to violate the rules, and today the offenders are being held to account.” Grossman thanked the prosecution team and the U.S. Coast Guard for their excellent work on this case.

“This prosecution highlights the U.S Attorney’s Office and the U.S. Coast Guard’s dedication in safeguarding our oceans against those that seek to deliberately harm our natural resources,” said Captain James W. Spitler, Sector Commander of the Coast Guard Sector San Diego. “Illegal dumping of oil and falsification of oil record books are egregious violations. Today’s guilty plea should serve as a reminder that the Coast Guard and our partners at the Department of Justice will work tirelessly to hold accountable those that seek to deliberately discharge oil and falsify ship records.”

New Trade and Plasabas each pleaded guilty to a felony violation of the Act to Prevent Pollution from Ships for failing to accurately maintain the Longshore’s oil record book. Under the terms of the plea agreement and subject to court approval, New Trade will pay a total fine of $1,100,000 and serve a four-year term of probation, during which any vessels operated by the company and calling on U.S. ports will be required to implement a robust Environmental Compliance Plan. Sentencing for the defendants is currently set for Nov. 18.

This case was investigated by the U.S. Coast Guard Sector San Diego and the U.S. Coast Guard Investigative Service. The case is being prosecuted by Assistant U.S. Attorney Melanie K. Pierson for the Southern District of California and Senior Trial Attorney Stephen Da Ponte of the Justice Department’s Environment and Natural Resources Division, Environmental Crimes Section.

Three people were arrested today on criminal charges in three separate indictments filed in the District of Idaho. These charges relate to the defendants’ alleged roles in fraudulently obtaining and misusing Paycheck Protection Program (PPP) loans.

According to court documents, Khadijah Chapman, 58, of Atlanta; Daniel Labrum, 41, of South Jordan, Utah; and Eric O’Neil, 57, of Bethel, Connecticut, are charged with fraudulently obtaining PPP loans for fictitious businesses in 2021. The defendants, along with others, allegedly falsified information and submitted fraudulent documents to collectively obtain over $2.4 million in relief funding guaranteed by the Small Business Administration (SBA) under the Coronavirus Relief, Aid, and Economic Security (CARES) Act for small businesses struggling with the economic impact of COVID-19. 

Chapman and O’Neil are each charged with one count of bank fraud, and Labrum is charged with five counts of bank fraud and one count of engaging in monetary transactions with criminally derived proceeds for their roles in the scheme. If convicted, Chapman, Labrum, and O’Neil each face a maximum penalty of 30 years in prison for each count of bank fraud. Labrum additionally faces a maximum of 10 years in prison for engaging in monetary transactions with criminally derived proceeds. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division; U.S. Attorney Joshua D. Hurwit for the District of Idaho; Assistant Director Luis Quesada of the FBI’s Criminal Investigation Division; Special Agent in Charge Stephen Belongia of the FBI’s Buffalo Field Office; Special Agent in Charge Thomas Fattorusso of the IRS Criminal Investigation (IRS-CI); and Inspector in Charge Ketty Larco-Ward of the United States Postal Inspection Service (USPIS) made the announcement. 

The FBI, IRS-CI, and USPIS are investigating the case.

Trial Attorneys Jennifer Bilinkas and Tamara Livshiz of the Justice Department’s Fraud Section and Assistant U.S. Attorney Sean Mazorol for the District of Idaho are prosecuting the case.

On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.

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

An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

A California man pleaded guilty yesterday in the Western District of Texas to conspiracy to solicit millions of dollars in contributions to two political action committees based on false and misleading representations that the funds would be used to support presidential candidates during and after the 2016 election cycle.

According to court documents, from 2016 through at least April 2017, Robert Reyes, Jr., 40, of Hollister, along with others, operated two political action committees—Liberty Action Group PAC and Progressive Priorities PAC—which solicited contributions from the public via robocalls and television, radio, and internet advertisements. The two PACs represented that the contributions would be used to support dueling presidential nominees of the two major political parties, respectively. Instead, Reyes and his co-conspirators used the funds to enrich themselves and to fund additional fraudulent solicitations. Specifically, Reyes admitted that the two PACs raised approximately $3.5 million in contributions during the 2016 election cycle and subsequent months, of which Reyes received approximately $714,000. Of the approximately $3.5 million raised, the two PACs contributed approximately $19 to legitimate political causes.

Additionally, to conceal the origin and nature of the proceeds of the fraudulent scheme, Reyes and others instructed a third-party vendor to withdraw approximately $353,000 from the two PACs in excess of the payments for services rendered, then deposit the excess payments into accounts held by shell companies that they controlled. Reyes admitted to operating additional fraudulent PACs beyond the 2016 election cycle, Support American Leaders and Campaign to Support the President, from which he received approximately $95,000 generated from false and misleading solicitations to donors.

As part of his plea, Reyes agreed to forfeit $809,920.40 that he received for his participation in the scam-PACs during the scheme.

Reyes pleaded guilty to one count of conspiracy to commit wire fraud and to cause false statements to the Federal Election Commission and one count of money laundering. Sentencing will be scheduled at a later date. He faces a maximum penalty of 20 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division and Special Agent in Charge Oliver E. Rich of the FBI’s San Antonio Field Office made the announcement.

The investigation was conducted by the FBI’s San Antonio Division, Austin White Collar Crime Task Force.

Trial Attorneys Michael N. Lang and Celia Choy of the Criminal Division’s Public Integrity Section are prosecuting the case. Former PIN Trial Attorney Rebecca Schuman also contributed significantly to the investigation.

A federal jury convicted a North Carolina woman last Thursday for her role in a scheme to defraud several private health insurers by submitting over $34 million in false and fraudulent claims for physical therapy services that were never actually provided.   

According to court documents and evidence presented at trial, Jaroslava Ruiz, 50, of Chapel Hill, paid kickbacks and bribes to patient recruiters and patients with private insurance in exchange for allowing four Miami physical therapy clinics to bill for medical services that were never actually provided to those patients. Ruiz and her co-conspirators falsified medical records to give the impression that the physical therapy services were medically necessary, prescribed by a doctor, and actually rendered. In truth and fact, none or virtually none of the purported services had been provided. Ruiz and her co-conspirators submitted approximately $34.6 million in false and fraudulent claims to several private insurers for those nonexistent physical therapy services, of which the insurers paid approximately $7.7 million.

Ruiz was convicted of one count of conspiracy to commit health care fraud and wire fraud, and nine counts of health care fraud. She faces up to 20 years in prison on the conspiracy count, and up to 10 years in prison on each health care fraud count. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors. Sentencing is scheduled for Oct. 26, 2022.

Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division; U.S. Attorney Juan Antonio Gonzalez for the Southern District of Florida; Assistant Director Luis Quesada of the FBI’s Criminal Investigative Division; and Special Agent in Charge George L. Piro of the FBI’s Miami Field Office made the announcement.  

The FBI is investigating the case.

Trial Attorneys Emily Gurskis and Patrick Queenan of the Criminal Division’s Fraud Section are prosecuting the case.

The Justice Department today announced that two Virginia landlords have agreed to pay $225,000 to resolve allegations that they violated the Servicemembers Civil Relief Act (SCRA) by obtaining unlawful court judgments against military tenants at the Hideaway at Greenbrier Luxury Apartment Homes in Chesapeake, Virginia, and the Chase Arbor Apartments in Virginia Beach, Virginia.

“Eviction judgments seriously jeopardize servicemembers’ ability to find and obtain affordable housing and negatively impact the financial readiness of our armed forces,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “The department will vigorously pursue any landlord that obtains eviction judgments against servicemembers by misrepresenting their military status to the court.”

“A servicemember’s military career is adversely affected by a judgment, which affects the military’s readiness,” said U.S. Attorney Jessica D. Aber for the Eastern District of Virginia. “The U.S. Attorney’s Office is committed to pursuing companies that obtain default judgments against servicemembers by misrepresenting a servicemember’s military status or by failing to file an affidavit of military service, as required by the SCRA.”

Under the SCRA, if a landlord files a civil lawsuit against a tenant and the tenant does not appear in court, the landlord must file an affidavit with the court stating whether the tenant is in the military before seeking a judgment. If the affidavit says that the tenant is in military service, the court cannot enter judgment until it appoints an attorney to represent the servicemember. The court must also postpone the case for at least 90 days. In a complaint filed in the U.S. District Court for the Eastern District of Virginia, the department alleges that the owners of the Hideaway at Greenbrier and Chase Arbor Apartments filed false affidavits and failed to file affidavits of military service, as required by the SCRA, prior to obtaining default judgments against numerous servicemembers. The properties are affiliated with one another and used the same law firm to file eviction claims in Virginia state courts.

The department alleges that the properties’ owners knew or should have known that the affidavits that they filed were inaccurate, because their files contained information that would have allowed them to easily verify their tenants’ military status. Landlords and lenders can also verify an individual’s military status by searching the Defense Manpower Data Center’s free publicly available website and by reviewing their files to see if there are applications, military leave and earnings statements or military orders indicating military status.

Under the proposed consent order, which still must be approved by the court, the owners of the two properties will pay $162,971 to affected servicemembers and a $62,029 civil penalty to the United States. The order also requires the owners to vacate the eviction judgments, repair the servicemembers’ credit, provide SCRA training to their employees and develop new policies and procedures consistent with the SCRA. The owners must also reimburse affected servicemembers for any amounts collected pursuant to an unlawful judgment.

This matter was handled jointly by the Civil Rights Division’s Housing and Civil Enforcement Section and the U.S. Attorney’s Office for the Eastern District of Virginia. Since 2011, the department has obtained over $476 million in monetary relief for over 121,000 servicemembers through its enforcement of the SCRA. For more information about the department’s SCRA enforcement efforts, please visit www.servicemembers.gov.

Servicemembers and their dependents who believe that their rights under the SCRA have been violated should contact the nearest Armed Forces Legal Assistance Program Office. Office locations may be found at http://legalassistance.law.af.mil.

The civil claims settled are allegations only; there has been no determination by a court of liability.

A Massachusetts man was arrested on Saturday, after being charged by indictment with willfully failing to pay over employment taxes to the IRS, conspiring to defraud the IRS, and aiding in the preparation of a false tax return.

According to the superseding indictment, Mauricio Baiense, formerly of Quincy, owned and operated Contract Framing Builders, Inc. (CFB), a Medford construction business. Baiense allegedly was responsible for filing CFB’s quarterly employment tax returns and collecting and paying over to the IRS payroll taxes withheld from the wages of the company’s employees.

From approximately 2013 through 2017, Baiense allegedly took a series of steps to convert CFB’s corporate funds into cash. The indictment charges that he allegedly wrote checks drawn on CFB’s bank account to purported subcontractors, which were in fact nominee entities controlled by him. Baiense allegedly then cashed or directed others to cash approximately $11 million in such checks at a check cashing business during this period. Baiense, and at times another man, then allegedly used the cash to operate an “off-the-books” cash payroll for CFB’s employees. He allegedly did not report the cash wages to the IRS and did not pay employment taxes on wages paid to employees in cash. Baiense also allegedly assisted in the preparation of at least one fraudulent employment tax return that understated the actual wages paid to CFB’s employees.

In June, Baiense was indicted for making a false statement when questioned at a U.S. Department of Labor Occupational Safety and Health Administration hearing regarding a workplace accident.

If convicted, Baiense faces up to five years in prison for each of the seven counts of willful failure to collect or pay over employment taxes, five years in prison for conspiring to defraud the United States, and three years in prison for aiding and assisting in the preparation of a false tax return. He also faces up to five years in prison for the false statement charge. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and U.S. Attorney Rachael S. Rollins for the District of Massachusetts made the announcement.

IRS-Criminal Investigation, the Department of Labor’s Occupational Health and Safety Administration, and Homeland Security Investigations investigated the case.

Trial Attorney Thomas F. Koelbl of the Justice Department’s Tax Division and Assistant U.S. Attorney David Tobin of the U.S. Attorney’s Office are prosecuting the case.

An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

A federal judge in the Southern District of Georgia today sentenced Travis McMichael, 36, to life plus 10 years in prison; and his father Gregory McMichael, 66, to life plus seven years in prison; and William “Roddie” Bryan, 52, to 35 years in prison, for committing federal hate crimes and other offenses in connection with the killing of Ahmaud Arbery, a young Black man, who was jogging on the public streets of a Brunswick neighborhood when he was chased down and shot to death in February 2020. 

All three defendants were convicted at trial in February 2022 on multiple counts, including one count of using violence to intimidate and interfere with Arbery because of his race and because he was using a public street. All three defendants were also found guilty of attempting to kidnap Arbery by chasing after him in their trucks in an attempt to capture and confine him. Finally, Travis McMichael was found guilty of using, carrying, brandishing, and discharging a Remington shotgun in the course of the hate crime, which added 10 years to his life sentence; and Gregory McMichael was found guilty of using, carrying and brandishing a .357 Magnum revolver, which added seven years to his life sentence. 

“The Justice Department’s prosecution of this case and the court’s sentences today make clear that hate crimes have no place in our country, and that the Department will be unrelenting in our efforts to hold accountable those who perpetrate them,” said Attorney General Merrick B. Garland. “Protecting civil rights and combatting white supremacist violence was a founding purpose of the Justice Department, and one that we will continue to pursue with the urgency it demands.”

“It was important that this murder was prosecuted for what it was—a brutal and abhorrent racially-motivated hate crime,” said Assistant Attorney General Kristen Clarke of the Justice Department's Civil Rights Division. “Ahmaud Arbery should be alive today. The tragic murder of Mr. Arbery reminds us that hate-fueled violence targeting Black people remains a modern-day threat in our country, and we must use every tool available to hold perpetrators accountable. We hope that this sentencing ends one painful chapter for the family of Ahmaud Arbery, the Brunswick community and the nation as a whole.”

“Those who commit hate crimes target what makes us who we are as Americans, striking at the very heart of our society,” said FBI Director Christopher Wray. “This is why combatting hate crimes and protecting civil rights are top priorities for the FBI. We will continue to fulfill our mission, working with our partners to investigate these acts of hatred and violence, and protecting the American people.”

“These substantial sentences should deliver a sense of finality and closure to an exceptionally tragic chapter in the Southern District of Georgia,” said U.S. Attorney David H. Estes for the Southern District of Georgia. “Even as the family and friends of Ahmaud Arbery continue to mourn his horrific and needless murder, we can find hope for our community’s future in the cooperative work of our law enforcement partners and prosecutors who brought these men to justice for their hateful crimes.” 

Evidence at trial revealed that on Feb. 23, 2020, defendants Travis and Gregory McMichael armed themselves with firearms and chased after Arbery as he ran past their driveway. The pursuit passed by the home of defendant Roddie Bryan, who got into his own truck and joined the chase, despite the fact that he did not know and had never before seen Arbery. For the next four to five minutes, the three defendants pursued Arbery through the neighborhood, trying to box him in with their trucks. For that entire time, Arbery ran from the defendants, unarmed and with his hands in plain view. He never spoke a word to the defendants, and never made any threatening sound or gesture; rather, he repeatedly tried to run away. Ultimately, after Arbery had already changed direction multiple times, trying to escape from the defendants, Travis McMichael got out of his truck and pointed a shotgun directly at Arbery. When Arbery tried to defend himself, Travis McMichael shot him in the chest. Arbery, wounded, grabbed for the gun. During a struggle over the gun, Travis McMichael fired two more shots into Arbery, who then stumbled a few steps and fell face-first onto the pavement, where he died in the street.

Evidence at trial revealed that the defendants had strongly held racist beliefs that led them to make assumptions and decisions about Arbery that they would not have made if Arbery were white.

Travis McMichael’s social media comments and text messages to friends, offered as exhibits at trial, showed that Travis harbored racial animus against Black people, whom he described at points as “sub-human savages” who “ruin everything”; the social media comments also revealed that Travis had for many years associated Black people with criminality and had expressed a desire to see Black people — particularly those he viewed as criminals — harmed or killed. 

Witnesses testified at trial about deeply racist comments Gregory McMichael had made to people he barely knew.  One witness testified about a brief encounter she had with Gregory in a professional capacity, during which she commented that it was “too bad” that Julian Bond, a Black Georgia civil rights leader, had recently passed away; Gregory angrily responded that he wished Bond had “been put in the ground years ago” and that Bond and “those Blacks” were “nothing but trouble.” According to the witness, Gregory then went on a five-minute rant about Black people.

The jury also saw racist text messages from Roddie Bryan.  When Bryan learned, just four days before the shooting, that his daughter was dating a Black man, Bryan referred to the boyfriend as a “ni----” and a “monkey.” In other messages on social media, Bryan also referred to other Black people using racial slurs. When the police spoke to Bryan about Arbery’s death, he admitted that he had never seen or heard anything about Arbery before; when he saw a Black man being chased, his “instinct” told him that the man must be a thief, or maybe had shot someone.

At trial, the jury found that the evidence proved beyond a reasonable doubt that race formed a but-for cause of the defendants’ actions on Feb. 23, 2020—meaning that, but-for Arbery being Black, the defendants would not have assumed he was a criminal, chased him down, and shot him.

All three defendants were previously convicted in a separate state trial on felony murder charges and other offenses. In state court, the McMichaels were both sentenced to life imprisonment without the possibility of parole, and Bryan was sentenced to life imprisonment with the possibility of parole.

This case was investigated by both the Georgia Bureau of Investigation and the FBI, and was prosecuted by Assistant U.S. Attorney Tara Lyons of the Southern District of Georgia, and Deputy Chief Bobbi Bernstein and Special Litigation Counsel Christopher J. Perras of the Civil Rights Division.

Attorney General Merrick B. Garland issued the following statement today commemorating the anniversary of the Voting Rights Act:

"Fifty-seven years ago tomorrow, one of our nation’s most consequential pieces of civil rights legislation -- the Voting Rights Act of 1965 -- was signed into law.

"The Voting Rights Act sought to make real the 15th  Amendment's guarantee that no American citizen be denied the right to vote on account of race.

"Central to the law was Section 5’s “preclearance” provision, which prevented jurisdictions with a history of discriminatory voting practices from adopting new voting rules until they could show the Justice Department or a federal court that the change would not have a racially discriminatory purpose or result.

"Yet in its 2013 decision in Shelby County v. Holder, the Supreme Court effectively eliminated the act’s preclearance protections. And in the years since, there has been a dramatic rise in legislative efforts that make it harder for millions of Americans to vote and to elect representatives of their own choice.

"Ahead of the 57th anniversary of the Voting Rights Act, the Justice Department remains committed to relentlessly protecting voting rights with the enforcement powers we have. And we continue to ask Congress to restore critical tools to help protect the fundamental right to vote."

The Attorney General, Deputy Attorney General, and Associate Attorney General today met with families of fallen officers to discuss the importance of the passage of the Public Safety Officer Support Act of 2022. The bipartisan bill expands coverage of the Public Safety Officers' Benefits Program, administered by the Justice Department’s Bureau of Justice Assistance, to include officers who are permanently and totally disabled due to particular mental health disorders and/or who die by suicide as a result of exposure to a traumatic event they encounter while on duty.

“Every day, public safety officers across the country put themselves in harm’s way to respond to some of the most difficult and traumatic moments that our communities face,” said Attorney General Merrick B. Garland. “The Justice Department welcomes the passage of the Public Safety Officer Support Act of 2022, which will enable us to provide support to the families of fallen officers who have died by suicide and to officers who have suffered debilitating trauma-related mental health injuries.”

“The Justice Department knows the toll that service in law enforcement can take, not only on those in uniform but also on those around them,” said Deputy Attorney General Lisa O. Monaco. “We commend Congress for passing the Public Safety Officer Support Act of 2022. It provides critical new support to families of the fallen. We will continue to do everything we can to ensure that public safety officers throughout the law enforcement community are cared for and protected, just as they care for and protect us all.”

“Supporting public safety officers and their families after a tragic loss or catastrophic disability is one of our solemn responsibilities at the Justice Department,” said Associate Attorney General Vanita Gupta. “Since 1976, the Public Safety Officers’ Benefits Program—administered by the Bureau of Justice Assistance—has provided nearly $2 billion in assistance to survivors of first responders. This bipartisan legislation is a welcome response to concerns expressed by the public safety community that this support be extended to recognize harms from an exposure to trauma while on duty. We commend members of Congress for their leadership on this issue and look forward to putting this bill to work on behalf of the brave professionals who serve and protect our communities.”

During the meeting, Department leadership heard directly from families about the unique grief of losing a loved one to suicide and discussed the impact this legislation will have on the healing process for families. Department officials recognized that public safety officers are routinely called to respond to stressful and potentially traumatic situations, often putting their lives in danger. 

Participating in the meeting were family members of officers Howard “Howie” Liebengood of the U.S. Capitol Police, Jeffrey Smith of the D.C. Metropolitan Police Department, and Shelane Gaydos of the Fairfax County Police Department.

A Maryland man made his initial appearance in federal court yesterday after being charged with 16 counts of willful failure to collect, account for and pay over employment taxes to the IRS.

According to the indictment, Brett Hill, of Parkton, owned and operated two telecommunications companies and was responsible for collecting and paying to the IRS income, Social Security, and Medicare taxes withheld from the wages of employees at both companies. Hill allegedly collected such taxes from the employees of the two companies but did not pay those taxes to the IRS or file quarterly employment tax returns. In total, Hill did not pay to the IRS approximately $900,000 in payroll taxes related to the two companies.

If convicted, Hill faces up to five years in prison for each of 16 counts of willful failure to collect or pay over employment taxes. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and U.S. Attorney Erek L. Barron for the District of Maryland made the announcement.

IRS-Criminal Investigation is investigating the case.

Trial Attorneys Shawn Noud and Catriona Coppler of the Justice Department’s Tax Division are prosecuting the case.

An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

A California man was sentenced today in the Eastern District of New York to four years in prison for defrauding American Express of approximately $4.7 million and for laundering the proceeds of his fraud.

According to court documents and evidence presented at trial, between November 2017 and December 2019, Jasminder Singh, 45, of Fremont, used four business entities that he created and controlled and 10 American Express credit cards in those entities’ names to purchase thousands of Apple iPhones. He then sold the iPhones to overseas purchasers for millions of dollars. As part of his scheme, Singh falsely told American Express that he was unable to repay approximately $4.7 million in charges incurred from the purchase of the iPhones, and created fake payment invoices in order to secure additional credit from American Express. Singh then used the proceeds of the scheme to pay for personal expenses and to buy luxury items, including a $1.3 million home and a luxury vehicle.

Singh was ordered to pay $4,651,845.08 in restitution and ordered to forfeit $3,018,602.22.

Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division; U.S. Attorney Breon Peace for the Eastern District of New York; Assistant Director Luis Quesada of the FBI’s Criminal Investigative Division; and Assistant Director-in-Charge Michael J. Driscoll of the FBI’s New York Field Office made the announcement.

The FBI investigated the case.

Trial Attorney Patrick J. Campbell of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Michael W. Gibaldi of the Eastern District of New York prosecuted the case.

A federal grand jury returned a 10-count indictment that was unsealed today charging a former Sanger Police Department officer with deprivation of constitutional rights under color of law for sexually assaulting four women with whom he interacted during the course of his duties.

According to the indictment, on multiple occasions from August 2017 to June 2021, J. DeShawn Torrence, 38, of Corcoran, California, engaged in various forms of nonconsensual sexual conduct, ranging from directing a victim to remove her clothing without a legitimate law enforcement purpose to forcing his victims to engage in sex acts, all while serving as a police officer. Torrence is no longer employed by the Sanger Police Department.  

Four of the charged counts alleged each carries a maximum statutory penalty of life in prison and a $250,000 fine. One count carries a maximum statutory penalty of 10 years. The remaining five counts each carry a maximum statutory penalty of one year in prison and a fine of up to $100,000. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

Anyone with information is encouraged to contact the FBI at 916-746-7000.

Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division, U.S. Attorney Phillip A. Talbert for the Eastern District of California and Acting Special Agent in Charge Dennis Guertin of the FBI Sacramento Field Office made the announcement. 

This case is being investigated by the FBI Sacramento Field Office with assistance from the Fresno County Sheriff’s Office.

Special Litigation Counsel Fara Gold of the Criminal Section of the Justice Department’s Civil Rights Division and Assistant U.S. Attorney Karen Escobar are prosecuting the case.

The alleged operator of the illicit cryptocurrency exchange BTC-e was extradited yesterday from Greece to the United States to face charges in the Northern District of California.

“After more than five years of litigation, Russian national Alexander Vinnik was extradited to the United States yesterday to be held accountable for operating BTC-e, a criminal cryptocurrency exchange, which laundered more than $4 billion of criminal proceeds,” said Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division. “This extradition demonstrates the Department’s commitment to investigating and dismantling illicit cyber activity and would not have been possible without the relentless work of the Justice Department’s Office of International Affairs. The Justice Department thanks the Government of Greece, particularly the Ministry of Justice, for all their efforts in securing the defendant’s transfer to the United States.”

Alexander Vinnik, 42, a Russian citizen, was charged in a 21-count superseding indictment in January 2017. Vinnik was taken into custody in Greece in July 2017 at the request of the United States. He made his initial appearance earlier today in federal court in San Francisco before U.S. Magistrate Judge Sallie Kim.

According to the indictment, Vinnik and his co-conspirators allegedly owned, operated, and administrated BTC-e, a significant cybercrime and online money laundering entity that allowed its users to trade in bitcoin with high levels of anonymity and developed a customer base heavily reliant on criminal activity. 

The indictment alleges BTC-e facilitated transactions for cybercriminals worldwide and received criminal proceeds from numerous computer intrusions and hacking incidents, ransomware scams, identity theft schemes, corrupt public officials, and narcotics distribution rings, and was used to facilitate crimes ranging from computer hacking, to fraud, identity theft, tax refund fraud schemes, public corruption, and drug trafficking. The investigation has revealed that BTC-e received more than $4 billion worth of bitcoin over the course of its operation.

Despite doing substantial business in the United States, the indictment alleges that BTC-e was not registered as a money services business with the U.S. Department of Treasury, had no anti-money laundering process, no system for appropriate “know your customer” or “KYC” verification, and no anti-money laundering program as required by federal law. 

In 2017, FinCEN assessed a civil money penalty against BTC-e for willfully violating U.S. anti-money laundering (AML) laws and against Vinnik for his role in the violations. A civil matter to enforce civil monetary penalties, in the amount of $88,596,314 as to BTC-e and $12 million as to Vinnik, is pending in the Northern District of California.

The indictment charges BTC-e and Vinnik with one count of operation of an unlicensed money service business, and one count of conspiracy to commit money laundering. In addition, the indictment charges Vinnik with 17 counts of money laundering and two counts of engaging in unlawful monetary transactions.

The FBI, IRS Criminal Investigation (Oakland Field Office and Cyber Crime Unit, Washington, D.C.), Homeland Security Investigations, and U.S. Secret Service Criminal Investigative Division are investigating the case.

Trial Attorney C. Alden Pelker of the Justice Department’s Computer Crime and Intellectual Property Section, and Assistant U.S. Attorney Claudia Quiroz of the U.S. Attorney’s Office for the Northern District of California are prosecuting the case.

The Justice Department’s National Cryptocurrency Enforcement Team provided substantial assistance. The extradition request was handled by the Justice Department’s Office of International Affairs.

The Justice Department thanks the Greek Ministry of Justice for its cooperation in securing the defendant’s transfer to the United States.

An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.