District of Nevada

LAS VEGAS, Nev. – A Las Vegas man has been arrested on wire fraud charges for taking hundreds of thousands in fees from persons who thought the payments would help them obtain loans for various business ventures, announced U.S. Attorney Daniel G. Bogden for the District of Nevada and Laura A. Bucheit, Special Agent in Charge of the FBI for Nevada.

Ronald Gene Morgan, 60, was arrested by FBI agents in Las Vegas on Jan. 29. He is charged in a criminal indictment with 13 counts of wire fraud and criminal forfeiture. Morgan appeared before U.S. Magistrate Judge Cam Ferenbach on Jan. 29, and pleaded not guilty to the charges. At a detention hearing today, Morgan was released on a personal recognizance bond pending a March 30 trial date.

“We have been working diligently with our federal, state and local investigative partners to catch and prosecute persons who are committing advance fee fraud crimes,” said U.S. Attorney Bogden. “The persons who commit these offenses portray themselves as legitimate business persons, when in reality they are nothing more than con artists.”

According to the indictment, from about March 2009 to April 2011, Morgan resided in Las Vegas and operated an Illinois-incorporated company, Argent Asset Management, and a Florida-incorporated company, Argent securities (Argent). Morgan allegedly used numerous means, including the mail, internet, and telephone to advertise a fraudulent bond-offering program. Morgan promised persons that for an advance fee, he would provide them with business loans by using Argent’s assets to acquire bank bonds at a discount. Morgan told the victims that he would then re-sell the bonds at face value to an investor, generating hundreds of millions of dollars that would be available in funding to them for their various business ventures. As part of the scheme, Morgan required advance fees from victims in amounts as high as $780,000, and told victims that the fees would be held in escrow; would be refunded if loans were not obtained; and would be used solely for purposes relating to obtaining the loan. Morgan knew Argent had no assets and acquired no bonds. Morgan converted the fees he received from the victims to personal uses such as travel and entertainment, and also used them to promote and conceal the scheme to defraud. Morgan continued to solicit and accept victims’ fees while knowingly providing false excuses for funding delays when he knew he had converted victim fees to his own personal use, causing losses to victims of more than 3 million dollars.

If convicted, Morgan faces a maximum of 20 years in prison and a $250,000 fine on all counts.

The case is being investigated by the FBI, and prosecuted by Assistant U.S. Attorney Christina M. Brown.

This prosecution is part of efforts underway by President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets and recover proceeds for victims of financial crimes. For more information about the task force visit: www.stopfraud.com.

The public is reminded that an indictment contains only charges and is not evidence of guilt. The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

LAS VEGAS, Nev. – Four persons have been charged with conspiracy and fraud for obtaining money from small business owners for grant funding and services that they never provided or intended to provide, announced U.S. Attorney Daniel G. Bogden for the District of Nevada and Laura A. Bucheit, Special Agent in Charge of the FBI for Nevada.  

Jason Demko, 38, Lorraine Riddiough, 66, Lissette Alvarez, 27, all of Las Vegas, and Mark Jones, 32, of Barberton, Ohio, are charged in a criminal indictment with one count of conspiracy to commit mail fraud and wire fraud, five counts of wire fraud, and criminal forfeiture.  Riddiough, Alvarez, and Jones were arrested in Las Vegas yesterday.  They appeared yesterday before Magistrate Judge Ferenbach and pleaded not guilty to the charges, and were released on personal recognizance bonds pending a March 16 trial date.  Demko is scheduled to appear before U.S. Magistrate Judge Cam Ferenbach at 3:00 p.m. today for an arraignment.

“Unfortunately, advance fee fraud schemes are very common,” said U.S. Attorney Bogden. “The con artist will ask for money up front before any tangible service or product is provided, and it will be very difficult to get your money back once you have turned it over to the scammers.”

“These arrests emphasize the FBI's continued commitment to investigate financial crimes,” said Special Agent in Charge Bucheit. “It also serves as a reminder for consumers to protect themselves, and remember if it seems too good to be true, it almost always is."

According to the indictment and other court records, from about January 2013 to February 2014, the defendants allegedly made false and fraudulent representations and promises to small business owners to persuade and induce them to pay initial fees, usually between $2,500 and $5,000 for goods and services they thought would help them obtain grants for their businesses.  The business owners were told that the total cost for obtaining a grant was between $10,000 and $15,000, depending on the total amount of funding requested, and that the remaining fees would not be charged until the owners received 100 percent of the grant funding.  Among other things, the defendants falsely stated that they represented a company named Foundation Processing Center in Wilmington, Del., when in fact, they represented JCD Business Services in Las Vegas; falsely stated that only certain clients had qualified for grants, when in fact anyone who paid the fees were qualified by the defendants; and stated that they had obtained grants for other clients, when in fact they had not done so.  The defendants also re-solicited clients for additional fees, including business plans, when they knew that the plans were not going to assist the clients in obtaining any grants.  The defendants knew that the true purpose of their solicitations was to obtain funds to personally enrich themselves.

If convicted, the defendants face a maximum of 20 years in prison and a $250,000 fine on all counts.

The case is being investigated by the FBI, and prosecuted by Assistant U.S. Attorney Sarah E. Griswold.

This prosecution is part of efforts underway by President Barack Obama’s Financial Fraud Enforcement Task Force.  President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes.  The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources.  The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets and recover proceeds for victims of financial crimes.  For more information about the task force visit: www.stopfraud.com.

The public is reminded that an indictment contains only charges and is not evidence of guilt. The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

WASHINGTON - The U.S. Court of Appeals for the Ninth Circuit today affirmed the convictions of a former Nevada lobbyist for making excessive campaign contributions and contributions in the name of another person, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Daniel G. Bogden of the District of Nevada.

“We're pleased that today's decision confirms that the cornerstones of our campaign finance laws - contribution limits and transparency - are not subject to creative misinterpretations of those determined to break the law,” said Assistant Attorney General Caldwell.

“Harvey Whittemore knew the law, he knew how to raise money the right way, he knew right from wrong, and he knew how he could violate the law and avoid detection,” said U.S. Attorney Bogden.  “He made a conscious and willful choice to violate federal elections laws in order to increase his own power and influence at the expense of the voting public and the election process.”

F. Harvey Whittemore, 62, of Reno, Nevada, a prominent Nevada lawyer, former lobbyist and land developer, was convicted by a jury in the District of Nevada in May 2013 of making excessive campaign contributions, making contributions in others’ names, and causing a materially false statement to be made to the Federal Election Commission (FEC).  He was sentenced on Sept. 30, 2013, to two years in prison and a $100,000 fine.

According to evidence presented at trial, Whittemore was aware of the strict limits on individual federal campaign contributions.  In an effort to circumvent those limits, he devised a scheme to unlawfully funnel more than $130,000 of his own money through approximately 29 family members, employees and their spouses to the campaign committee for a U.S. senator.  This scheme allowed Whittemore to make an individual campaign donation in excess of the federal limits. Whittemore concealed the scheme from the FEC, the senator, and the senator’s campaign committee.

       
The case was investigated by the FBI and prosecuted by Deputy Chief Eric G. Olshan of the Criminal Division’s Public Integrity Section and First Assistant U.S. Attorney Steven W. Myhre of the District of Nevada.  Appellate Chief and Assistant U.S. Attorney Elizabeth Olson White of the District of Nevada argued the appeal.

LAS VEGAS, Nev. – A woman who served as the getaway driver for the robberies of 13 banks and stores in southern Nevada from December 2012 to March 2013, has been convicted by a federal jury of multiple counts of robbery and firearm charges, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

Sesley Williams, 46, of Las Vegas, was convicted on Friday, Jan. 16 of eight counts of bank robbery, five counts of interference with commerce by robbery and five counts of brandishing a firearm in furtherance of a crime of violence.  Williams is scheduled for sentencing before U.S. District Judge Andrew P. Gordon on May 21, 2015.  She faces up to 20 years in prison on each robbery count and a mandatory minimum of 107 years in prison on the brandishing counts, which must run consecutively to the sentences for the other counts.

The co-defendant, Anthony Jordan, was convicted by a jury in November 2014 of 13 counts of robbery and firearm-related charges, and is scheduled to be sentenced on March 19, 2015.

The duo robbed six banks, three outlet mall and one other store in Las Vegas, two banks in Henderson, and one outlet mall store in Primm, Nev., between Dec. 28, 2012, and March 30, 2013.

This case was investigated by the Las Vegas Metropolitan Police Department, as part of the Safe Streets Task Force and Project Safe Neighborhoods program.  The case was prosecuted by Assistant U.S. Attorney Lisa Cartier-Giroux.

LAS VEGAS, Nev. – A Las Vegas lawyer who served as the U.S. Attorney for Nevada during the 1970’s, was sentenced today to 18 months in prison, one year of supervised release, and ordered to pay approximately $290,000 in restitution to the IRS for failing to file individual and corporate income tax returns from 2006 to 2010, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

Lawrence J. Semenza, II, 72, pleaded guilty in August 2014 to three misdemeanor counts of willful failure to file a tax return, and was sentenced by U.S. District Judge James C. Mahan. Semenza must report to federal prison by April 17, 2015.

“The consequences of failing to file your tax returns can be very serious,” said U.S. Attorney Bogden.  “At the end of the day, you are better off filing your return than facing penalties such as wage garnishments, asset seizures, prosecution, and, as in this case, prison time.”

“It is especially egregious that a former federal prosecutor should try to skirt his own tax obligations,” said John Collins, Special Agent in Charge of IRS Criminal Investigation for Nevada.  “American taxpayers have a right to expect that everyone will be held to the same standard of tax compliance.  No one, regardless of current or former position, is above the law.”

According to the guilty plea agreement, Semenza operated his law practice in Las Vegas as a subchapter C personal service corporation. For the years 2006 through 2010, Semenza individually had taxable income of approximately $655,000, and the corporation had taxable income of approximately $345,000, but Semenza failed to file individual or corporate income tax returns for those years, and failed to pay the tax due and owing to the IRS, totaling about $290,000.

           The case was investigated by IRS Criminal Investigation and prosecuted by Assistant U.S. Attorneys Eric Johnson and Nicholas D. Dickinson.

LAS VEGAS, Nev. – A Las Vegas man who robbed 13 convenience stores and a small casino in the Las Vegas area during 2013, was sentenced today by U.S. District Judge Gloria M. Navarro to multiple life terms in prison, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

Abdul Howard, 49, was convicted by a jury last June of one count of felon in possession of a firearm, 14 counts of interference with commerce by robbery, and 12 counts of possession of a firearm during, in relation to, and in furtherance of a crime of violence.  A number of the life terms were ordered to be served consecutively.  There is no parole in the federal system.

“This defendant, who has a lengthy criminal history, terrorized convenience store employees in Las Vegas over a four month period during 2013, and it is fortunate that no one was killed,” said U.S. Attorney Bogden.  “With his federal sentence of life in prison, Mr. Howard’s violent crime reign on Nevada streets and in our community is now over and done.”

Howard robbed 13 convenience stores and one casino in the Las Vegas area between January 15 and April 16, 2013.  Howard robbed most of the businesses late at night using a semi-automatic handgun which he used to threatened store employees and some customers.  In some of the robberies, Howard pointed the handgun at an employee or stuck a gun into the employee’s body or head.  In one instance, Howard fired a handgun at an employee, and in another, Howard shot an employee in the neck.  Investigators dubbed Howard the “Cinched Hoodie Robber,” because he typically entered the businesses wearing a hooded sweatshirt with the hood “cinched” up around his face in an effort to conceal his identity.

Howard has at least five prior felony convictions in New York, Florida, and Nevada related to robbery, burglary, cocaine distribution and sexually motivated coercion.

This case was investigated by the FBI, Las Vegas Metropolitan Police Department, and North Las Vegas Police Department, as part of the Safe Streets Task Force and Project Safe Neighborhoods program, and prosecuted by Assistant U.S. Attorneys Phillip N. Smith, Jr. and Cristina D. Silva.

LAS VEGAS, Nev. – A Las Vegas man who earned over $7 million during 2007 and failed to file a 2008 federal tax return with the IRS, was sentenced today to 10 months in prison,  one year of supervised release, and ordered to pay approximately $2.5 million in restitution to the IRS, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

“We work with the IRS to enforce the nation's tax laws,” said U.S. Attorney Bogden.  “We will do this fully, fairly, and consistently, through both criminal and civil litigation, in order to promote voluntary compliance with the tax laws and to maintain public confidence in the integrity of the tax system.”

Shawn Lampman, 49, was sentenced by U.S. District Judge James C. Mahan. Lampman was originally charged in April 2013 and pleaded guilty on April 14, 2014, to one count of failure to file an individual tax return. He must report to federal prison by April 6, 2015.

According to the guilty plea agreement, during 2007, Lampman earned income in excess of $7 million and willfully failed to make and file an individual tax return with the IRS on or before April 15, 2008.

The case was investigated by IRS Criminal Investigation and prosecuted by First Assistant U.S. Attorney Steven W. Myhre.

LAS VEGAS, Nev. – A Las Vegas man who formerly operated a well-known local adult entertainment club and owned an escort service business, was sentenced today by U.S. District Judge Phillip M. Pro to 15 months in prison for his guilty plea to tax evasion, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

Emannouil “Manny” Varagiannis, 44, was also ordered to pay $230,651 in restitution and to forfeit two homes in Las Vegas. Varagiannis was originally charged in September 2012, and pleaded guilty on April 9, 2014, to one count of tax evasion. He must report to federal prison by April 3, 2015.

“We work with the IRS to enforce the nation's tax laws,” said U.S. Attorney Bogden.  “We will do this fully, fairly, and consistently, through both criminal and civil litigation, in order to promote voluntary compliance with the tax laws and to maintain public confidence in the integrity of the tax system.”

According to the guilty plea agreement and court records, IRS Criminal Investigation began investigating Varagiannis in 2012 as a result of him conducting unusual banking activities.  At that time, Varagiannis was the owner of Midnight Entertainers, an adult escort service in Las Vegas. The investigation revealed that Varagiannis was structuring deposits into two financial institution accounts in order to avoid reporting the money to the IRS.  Specifically, between Jan. 6, 2009, and Aug. 16, 2012, Varagiannis made 182 deposits totaling approximately $1.5 million.   Further investigation revealed that Varagiannis and his wife used the funds from the two accounts to purchase two separate homes for cash.  Further investigation also revealed that Varagiannis failed to declare federal taxes he owed for the years 2009 through 2011, totaling $230,651, and that he willfully took affirmative steps to evade or defeat payment of the taxes, including conducting transactions to avoid financial institution reporting requirements to the IRS.

The case was investigated by IRS Criminal Investigation and the Las Vegas Metropolitan Police Department, and prosecuted by Assistant U.S. Attorney Cristina D. Silva.

  LAS VEGAS, Nev. – Seven persons have been charged by the federal grand jury in Las Vegas with using fraud and deception to steal money from small business owners who thought they were receiving assistance in obtaining grants for their businesses, announced U.S. Attorney Daniel G. Bogden for the District of Nevada and Laura A. Bucheit, Special Agent in Charge of the FBI for Nevada.  

Mark L. Bausch, aka Mark Eting, 40, Alan W. Rodrigues, 55, David Bergstrom, 49, Jonas Bowen, 61, Rachel Glaser, 74, Lee Panelli, 66, all of the Las Vegas area, and Craig Rudolph, 43, of Wonder Lake, Ill., are charged in a criminal indictment with one count of conspiracy to commit wire fraud and 31 counts of wire fraud.  Bausch and Rodrigues are also charged with six counts of money laundering.  Defendants Bausch, Rodrigues, Glaser, and Panelli were arrested this morning in Las Vegas. They appeared this afternoon before U.S. Magistrate Judge Nancy J. Koppe and pleaded not guilty to the charges, and were released on personal recognizance bonds with conditions pending trial.  Defendant Rudolph was arrested in Chicago this morning and will be scheduled for a court appearance in Las Vegas in the near future.  Defendants Bergstrom and Bowen are scheduled to surrender to federal authorities next week.

            “Paying money to someone in anticipation of receiving something of greater value—such as a loan, contract, investment, or gift, is a risky proposition,” said U.S. Attorney Bogden. “You should always ask yourself if you have any guarantee that the person requesting your money will use it in the manner upon which you agreed. If the opportunity seems too good to be true, it probably is.”

“Today’s arrests highlight the FBI’s commitment to investigate financial crimes and the continued need for consumers to be cautious and protect themselves,” said Special Agent in Charge Bucheit.

            According to the indictment, from about 2007 to 2010, the defendants allegedly organized and operated four telemarketing companies, Small Business Funding Co., Inc., Company Funds, Inc., Foundation Research, Inc., and Silver State Holding Company. In exchange for fees, the defendants offered to help small business owners obtain grants from public and private entities. The defendants made false statements and promises to the victims to make it appear that they were likely to or guaranteed to receive a grant. The defendants hired salespersons to market the services and to provide false information to the customers. In order to convince the customers that the service was legitimate, the defendants instructed their employees to conduct research about funding entities and send letters to customers and funders, knowing that many of the customers would not qualify for the grants.  The defendants also solicited customers by conducting seminars throughout the United States.  Through the entire scheme, the telemarketing companies received numerous complaints, and the defendants made false statements to them to prevent or delay them from contacting law enforcement.  The defendants used the proceeds from the scheme to enrich themselves.

If convicted, the defendants face a maximum of 20 years in prison on all counts.  Additionally, there is a maximum $250,000 fine on the conspiracy and each wire fraud count, and a maximum fine of $500,000 on each money laundering count.

The case is being investigated by the FBI and IRS Criminal Investigation, and prosecuted by Assistant U.S. Attorney Daniel R. Schiess.

This prosecution is part of efforts underway by President Barack Obama’s Financial Fraud Enforcement Task Force.  President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes.  The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources.  The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets and recover proceeds for victims of financial crimes.  For more information about the task force visit: www.stopfraud.com.

The public is reminded that an indictment contains only charges and is not evidence of guilt. The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

   LAS VEGAS, Nev. – The owner of CLS Transportation, a Las Vegas, Nev. limousine company, has pleaded guilty to a federal racketeering charge for using the company to commit and promote criminal activities, including prostitution, drug trafficking, and financial fraud, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

            Charles Horky, 54, of Las Vegas, pleaded guilty on Thursday, Dec. 18, before U.S. District Judge Robert C. Jones to one count of conspiracy to conduct or participate in an enterprise engaged in a pattern of racketeering activity.  Horky faces up to 20 years in prison and a $250,000 fine, and is scheduled to be sentenced on April 16, 2015.

             “As this case demonstrates, persons who commit serious criminal offenses as part of an organized criminal enterprise, including prostitution, drug dealing and credit card and bank fraud, will be charged with federal racketeering crimes,” said U.S. Attorney Bogden. “Through the guilty pleas of these defendants and the dismantling of their racketeering organization, law enforcement has closed the books on Charles Horky and his coconspirators and the limousine service used to further a number of criminal activities and schemes.”

            Five others charged in the scheme have also pleaded guilty, including CLS office manager Kimberly Flores, CLS accountant and financial advisor Archie Granata, two limousine drivers, James Reda and Clarence Adams, and Solomon Zemedhun, who was supplying controlled substances to the organization.  Two other limousine drivers and a drug supplier are pending trial.

According to Horky’s plea agreement, Horky owned a controlling interest in and was the managing member of CLS Nevada, LLC, which operated as CLS Transportation, Las Vegas. Beginning no later than September 2008 and continuing through November 2012, Horky and his co-defendants used the limousine service to conduct and facilitate a broad range of criminal activities, including selling controlled substances, facilitating illegal prostitution, credit card fraud, bank fraud and check-kiting.  Horky encouraged and directed the criminal activity, and required drivers to pay him a cut of the money they were receiving from the criminal activities.

In addition to distributing illegal drugs from CLS limousines and procuring prostitutes for CLS customers, Horky, Flores, and Granata devised and executed a scheme to defraud American Express by placing fraudulent unauthorized transactions on the American Express accounts of CLS customers. Many of the customers disputed the charges, and American Express notified CLS of the fraudulent transactions and executed charge-backs.  American Express eventually cancelled the CLS Transportation account, but the defendants perpetuated the fraudulent scheme by opening successive additional American Express merchant accounts under false names, aliases and nominees. In this manner, Horky, Flores, Granata and others, fraudulently obtained more than $2.8 million from American Express.  Horky, Flores and Granata also devised a check-kiting scheme in which they drew checks on CLS Transportation’s payroll account knowing that the account did not contain sufficient funds. Horky, Flores, and Granata knowingly issued themselves and their associates thousands of checks on the account without sufficient funds to honor the checks.

The plea agreement also states that Horky agreed to the entry of a criminal forfeiture money judgment of $5.2 million.   He is released on a personal recognizance bond pending sentencing.

The case is being investigated by the FBI and the Las Vegas Metropolitan Police Department through the Safe Streets Task Force.

   LAS VEGAS, Nev. – A suspended Las Vegas doctor who was prescribing and obtaining controlled substances at local pharmacies in the name of a deceased patient, pleaded guilty today to the federal felony offense of obtaining controlled substances by fraud, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

            Kent Swaine, 50, of Las Vegas, entered his guilty plea before U.S. District Judge Richard F. Boulware, and is scheduled to be sentenced on April 18, 2015. Swaine faces a maximum penalty of four years in prison and a $250,000 fine.

 “The Centers for Disease Control and Prevention has classified prescription drug abuse as an epidemic,” said U.S. Attorney Bogden. “We are acutely aware that this is a problem which cannot be addressed through law enforcement action alone, and have been working with community partners in three other major areas to prevent and reduce prescription drug abuse, education, monitoring, and medication disposal.”

            According to the court records, Swaine was originally licensed to practice medicine in Nevada in July 2001, and operated a medical practice at 5380 S. Rainbow Boulevard in Las Vegas. In January 2014, the Las Vegas DEA initiated an investigation into Swaine following a complaint that Swaine was writing prescriptions and obtaining controlled substances at several Las Vegas pharmacies in the name of a deceased patient. The investigation determined that Dr. Swaine was impersonating a deceased individual in order to obtain controlled substances. Swaine was arrested and charged by federal criminal complaint in August.  At the guilty plea today, Swaine admitted that he had been fraudulently writing and filling prescriptions for Hydromorphone (generic Dilaudid), in the name of a patient who died in August 2011, for the purpose of his own drug addiction.

            According to the State Medical Board’s website, Swaine’s license to practice is currently suspended indefinitely.

Next Wednesday and Thursday, Dec. 17 to Dec. 18, the U.S. Attorney’s Office is co-sponsoring with the Nevada High Intensity Drug Trafficking Area Task Force (Nevada HIDTA) an annual training summit in Las Vegas to address prescription drug abuse. In addition to law enforcement, medical, treatment and pharmacy providers, as well as community and family service agency representatives are welcome to attend.  For more information and to register go to: http://www.nvhidta.org/default.aspx?menuitemid=694.

The case was investigated by the HIDTA Pharm-Net Task Force, and prosecuted by Assistant U.S. Attorney Crane M. Pomerantz.

   LAS VEGAS, Nev. – A Katy, Texas couple who owned two mortgage service businesses in Henderson, Nev., have been sentenced to prison for their roles in a mortgage fraud scheme that caused over $30 million in losses to federally insured financial institutions, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

            Derrick Phelps, 46, former owner of Investors Realty and Enterprise Mortgage Services, was sentenced to 70 months in prison, and his wife, Cynthia Phelps, 44, was sentenced to four years in prison.  Both defendants were also ordered to serve five years of supervise release and to pay approximately $31 million in restitution.  They were sentenced by U.S. District Judge James C. Mahan on Tuesday, Dec. 2, and were permitted to self-report to federal prison by March 6, 2015.  They pleaded guilty in April to one count of conspiracy to commit bank fraud, mail fraud and wire fraud and seven counts of bank fraud. 

“Hundreds of mortgage industry employees and business owners have been convicted of fraud and sentenced to prison for defrauding the financial institutions during the housing boom in southern Nevada,” said U.S. Attorney Bogden. “We are continuing to work with our local, state and federal law enforcement partners to pursue all sorts of financial fraud cases that impact the entire community.”

             According to their plea agreements, from about January 2003 to November 2006, the defendants devised a scheme to defraud federally insured financial institutions through the use of false mortgage applications.  The defendants solicited buyers with good credit ratings to purchase homes in the Las Vegas area and made offers to purchase the homes above the sellers’ asking prices. In some instances, the defendants caused buyers to purchase multiple houses at or about the same time, so that the purchases would not show up on their credit report and the lenders would not be aware of the other purchases.  The defendants then caused false information to be placed in the buyer’s mortgage loan applications pertaining to things such as income and intent to occupy the home. Once the loans were approved, the defendants caused the sellers to agree that part of the excess funds be redirected to the buyers under the pretense of making upgrades and repairs to the properties.  The defendants intentionally concealed from the financial institutions that buyers were receiving part of the loan disbursements for their own use and benefit.  The defendants defaulted on the mortgage loans which caused the properties to go into foreclosure.  Using this scheme, the defendants purchased approximately 233 properties and caused losses to the financial institutions greater than $30 million

            Three co-defendants charged in the scheme, Linda Mack, Tai Keyster, and Darryl Reese, are scheduled to go to trial on March 15, 2015.

The case is being investigated by the United States Postal Inspection Service, and is being prosecuted by Assistant U.S. Attorney Sarah E. Griswold.

This prosecution is part of efforts underway by President Barack Obama’s Financial Fraud Enforcement Task Force.  President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes.  The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources.  The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets and recover proceeds for victims of financial crimes.  For more information about the task force visit: www.stopfraud.com.

   LAS VEGAS, Nev. – A local man who possessed over two kilos of methamphetamine in his car and another 4½ kilos of methamphetamine in a rented storage locker in Las Vegas, has been sentenced to 121 months in prison and five years of supervised release, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

            John Ortega, 25, of Las Vegas, was sentenced on Tuesday, Nov. 25, by Chief U.S. District Judge Gloria M. Navarro. Ortega pleaded guilty in August to one count of conspiracy to possess a controlled substance with intent to distribute methamphetamine and one count of money laundering.

            According to the court records, law enforcement investigators learned in early 2013 that Ortega was supplying kilo quantities of methamphetamine to co-defendant Keith Alcos, of Honolulu, Hawaii.  In August 2013, investigators obtained information that on Aug. 21, Alcos and two other co-defendants, James Richardson, Jr., and George Flores, were traveling from Honolulu to Las Vegas to obtain methamphetamine.  Investigators conducted surveillance of the defendants when they arrived in Las Vegas, and detected phone calls between the co-defendants and Ortega. On Aug. 25, they followed Ortega from his residence to a storage facility, where Ortega entered a storage unit and left with a black bag. Investigators conducted a traffic stop on Ortega’s vehicle and during a search of the vehicle, recovered approximately two kilos of methamphetamine from a compartment.  A later search of the storage unit resulted in the recovery of approximately 4½ kilos of liquid methamphetamine, $13,000, and a 9 mm handgun with an obliterated serial number. Investigators determined that Ortega rented the storage locker using a fake Mexican driver’s license bearing his photograph but the name of Jose Veltran Perez. 

Keith Alcos pleaded guilty to conspiracy to possess a controlled substance with intent to distribute methamphetamine, and is scheduled to be sentenced on Jan. 8, 2015. Richardson, Jr. and Flores are fugitives.

            This case was investigated by the FBI, IRS Criminal Investigation, DEA, and Las Vegas Metropolitan Police Department, and prosecuted by Assistant U.S. Attorney Amber M. Craig.

   LAS VEGAS, Nev. – Three local men have been charged with robbing a jewelry store in Las Vegas last week of approximately $700,000 worth of merchandise, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

            Theren Phillip Frazier, 27, Phillip Allerson Vaughn, 25, and Eric Jamar Goodall, 29, of North Las Vegas, are charged in a criminal complaint with one count of interference with commerce by robbery.  They made an initial court appearance yesterday before U.S. Magistrate Judge Cam Ferenbach.  Frazier and Vaughn were detained pending a preliminary hearing, and Goodall was temporarily detained pending a hearing on Monday.  If convicted, they face up to 20 years in prison and a $250,000 fine.

            “Our U.S. Attorney’s Office has made the prosecution of violent retail robbery and theft cases a priority,” said U.S. Attorney Bogden.  “We have been working with our local police departments and federal partners to identify these violent crime cases with interstate nexus for federal prosecutions.  The persons committing these crimes are typically repeat offenders who are unlawfully carrying and using firearms in furtherance of their crimes and are violating federal laws.”

            The complaint alleges that at about 2:00 p.m. on Nov. 10, Goodall, who was brandishing a semiautomatic pistol, and Vaughn entered a jewelry store located just off the Las Vegas Strip, and told victims to get down on the floor while they demanded jewelry and robbed the display cases of several hundred items of jewelry. Vaughn and Goodall loaded the jewelry into a backpack and left the store with about $700,000 worth of merchandise.  They were observed fleeing in a small white sedan driven by Frazier.  Las Vegas Metropolitan Police Department (LVMPD) officers followed the white car to a warehouse about a mile north, where Goodall and Vaughn jumped from the vehicle while it was still moving, and were apprehended.  Officers found the white vehicle badly damaged in a nearby casino valet area, and recovered from it a semiautomatic pistol and all of the jewelry from the robbery.  Frazier was arrested three days later by an FBI-led Criminal Apprehension Team task force.

            The case is being investigated by the FBI and LVMPD, and is being prosecuted by Assistant U.S. Attorneys Kathryn C. Newman and Daniel Cowhig.

The public is reminded that a criminal complaint contains only charges and is not evidence of guilt.  The defendants are presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

   LAS VEGAS, Nev. – U.S. Attorney Daniel G. Bogden announced today that the Nevada U.S. Attorney’s Office collected $10.9 million in Fiscal Year (FY) 2014 related to criminal, civil and asset forfeiture actions.  Of this amount, approximately $4.6 million was collected in criminal actions, $1.4 million was collected in civil actions, and $5 million was collected in criminal and civil forfeitures.
           
Additionally, the District of Nevada worked with other U.S. Attorney’s Offices and components of the Department of Justice to collect an additional $14 million in cases pursued jointly with these offices.  This additional shared amount was almost entirely collected in civil actions.  

“The collection of monetary penalties in federal litigation is a critical aspect of our work that frequently gets overlooked,” said U.S. Attorney Bogden.  “These collections are used to help crime victims and for a variety of other law enforcement purposes. Our FY 2014 collections far exceeded the total appropriated budget for our office for FY 2014.”  

An example of a recent case in which the U.S. Attorney’s Office for the District of Nevada collected a significant amount of money was a settlement of the Como Fire litigation.  That case involved a claim against Silver Reserve Corp. and Mining Contractor's Inc. for recoupment of fire suppression costs and rehabilitation of federal land.  The fire was caused by the negligent operation of an excavator that struck a power pole and ignited vegetation.  The contractor settled the claim and paid $250,000 to the United States.

Attorney General Eric Holder also announced today that the Justice Department collected $24.7 billion in civil and criminal actions in the fiscal year ending Sept. 30, 2014. The more than $24 billion in collections in FY 2014 represents nearly eight and a half times the appropriated $2.91 billion budget for the 94 U.S. Attorney’s offices and the main litigating divisions in that same period.

            “Every day, the Justice Department’s federal prosecutors and trial attorneys work hard to protect our citizens, to safeguard precious taxpayer resources, and to provide a valuable return on investment to the American people,” said Attorney General Holder.  “Their diligent efforts are enabling us to achieve justice and recoup losses in virtually every sector of the U.S. economy.  And this result shows the fruits of the Justice Department’s tireless work in enforcing federal laws; in protecting the American people from violent crime, national security threats, discrimination, exploitation, and abuse; and in holding financial institutions accountable for their roles in causing the 2008 financial crisis.”

The U.S. Attorneys’ Offices, along with the department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the U.S. and criminal debts owed to federal crime victims.  The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss.  While restitution is paid to the victim, criminal fines and felony assessments are paid to the department’s Crime Victims’ Fund, which distributes the funds to state victim compensation and victim assistance programs.

The largest civil collections were from affirmative civil enforcement cases, in which the United States recovered government money lost to fraud or other misconduct or collected fines imposed on individuals and/or corporations for violations of federal health, safety, civil rights or environmental laws.  In addition, civil debts were collected on behalf of several federal agencies, including the U.S. Department of Housing and Urban Development, Health and Human Services, Internal Revenue Service, Small Business Administration and Department of Education.

   LAS VEGAS, Nev. – U.S. District Judge Jennifer A. Dorsey sentenced three defendants this morning for their involvement in a conspiracy to distribute the synthetic drugs known as “spice” and “bath salts,” announced U.S. Attorney Daniel G. Bogden, for the District of Nevada. 

Joshua Michael Riley, 32, of Henderson, Nev., was sentenced to 51 months in prison and three years of supervised release, Nicholas Collado, 32, of Houston, Texas, was sentenced to 37 months in prison and three years of supervised release, and Alexandra Haardt, 28, of Henderson, Nev., was sentenced to three years of probation with a condition of one year of home confinement. They pleaded guilty over the summer to one count of conspiracy to possess with intent to distribute and distribute a controlled substance and controlled substance analogue.  Judge Dorsey also entered final orders of forfeiture against all of the defendants requiring them to turn over in large part to the government approximately $802,000 in bank accounts, $371,000 in gold and silver bars and coins, $32,000 in money orders and checks, $14,700 in jewelry, a Cadillac vehicle, a condominium in Henderson, Nev., and two handguns and ammunition.

Two other defendants were also charged in the conspiracy.  Marco Alvarado pleaded guilty and was sentenced on Nov. 12 to 30 months in prison, and Jacob Fisher pleaded guilty and is scheduled for sentencing on Nov. 19.

“Spice” and “bath salts” are potent and dangerous substances that are being sold to an unwary public in convenience stores, head shops, gas stations and online,” said U.S. Attorney Bogden. “These synthetic drugs are powerful substances that when consumed have caused hallucinations and dangerous levels of overdose.  We will continue working diligently with our local, state and federal law enforcement partners to prosecute persons who callously and recklessly distribute them.”

According to the court records, Riley owned and operated JMR Enterprises in Las Vegas. The defendants ordered chemicals from China, and manufactured controlled substance analogues, such as spice and bath salts, at Riley’s large residence in Las Vegas. The defendants sold the controlled substances online over the website, thesupplyboys.com, using the brand names “Mad Pineapple,” Tiger Blood,” “Mad Max,” and “New Ivory Wave,” and distributed the orders via overnight delivery service on a regular basis to buyers as far east as Philadelphia, Pa. In July 2012, agents executed a federal search warrant at Riley’s home and recovered approximately 26 pounds of synthetic cannabinoids, also known as “spice,” three pounds of synthetic cathinones also known as “bath salts,” packaging materials, baking pans containing substances that were drying outside, and two firearms.  Law enforcement investigators also recovered approximately three additional pounds of bath salts, and 47 packages of “spice,” from the mails during the investigation.

“As these sentences make abundantly clear, the manufacture and sale of synthetic drugs is a serious crime,” said Michael Harris, Assistant Special Agent in Charge for Homeland Security Investigations Las Vegas. “These substances may have benign names like ‘spice’ and ‘bath salts,’ but they have been linked to serious health complications and even death. Even more troubling, is the fact that the distributors of these dangerous synthetic drugs are packaging and marketing them to appeal to young people.”

According to the Office of National Drug Control Policy, synthetic drugs are a rapidly emerging threat and there is an increasingly expanding array of synthetic drugs available.  Use of synthetic drugs is alarmingly high, especially among young people. The contents and effects of synthetic drugs are unpredictable due to a constantly changing variety of chemicals used in manufacturing processes devoid of quality controls and government regulatory oversight.  Health warnings have been issued by numerous public health authorities and poison control centers describing the adverse health effects associated with the use of synthetic drugs. The Administration has been working with federal, congressional, state, local, and non-governmental partners to put policies and legislation in place to combat this threat, and to educate people about the tremendous health risk posed by these substances.  For more information on the risks and dangers of synthetic drugs, go to http://www.whitehouse.gov/ondcp/ondcp-fact-sheets/synthetic-drugs-k2-spice-bath-salts.

The case was prosecuted by Assistant U.S. Attorney James E. Keller and investigated by ICE HSI and the U.S. Postal Inspection Service, with the assistance of the DEA.

    RENO, Nev. – A California man who brought a 14-year-old girl from Richmond, Calif., to the Reno area with the intent that she engage in sexual activity, was sentenced on Nov. 13, 2014, to 10 years in prison and lifetime supervised, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

            Nicholas Rider Wessel, 38, of Richmond, Calif., pleaded guilty in August to one count of transportation of a minor for illegal sexual activity and was sentenced by U.S. District Judge Miranda M. Du.  Judge Du denied Wessel’s request for release on bond pending a prison designation.

“If you prey on underage children on the Internet, you face federal prosecution,” said U.S. Attorney Bogden. “The penalties are stiff, and you will be marked as a sex offender for the rest of your life.”

            According to the court records, sometime in May 2014, Wessel began communicating with the 14-year-old girl on Facebook and by cell phone texts. During those conversations, Wessel arranged to pick the girl up in Modesto, Calif. and drive her to his home in Richmond.  Wessel knew that she was only 14 years old. On May 5, Wessel picked her up, along with another minor girl, and they drove to his home where he engaged in sexual intercourse with the 14-year-old. The following day, Wessel drove the girl to Reno, and they again engaged in sex at a hotel in Sparks, Nev. 

The investigation was conducted by the Sparks Police Department and the FBI. The case was prosecuted by Assistant U.S. Attorney Carla Higginbotham.

The case was brought as part of Project Safe Childhood (PSC), a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, PSC marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about PSC, please visit www.usdoj.gov/psc.  For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."

    RENO, Nev. – Michael Stickler, 54, of Reno, pleaded guilty today before U.S. District Judge Larry R. Hicks to one count of willful failure to collect or pay employment and Federal Insurance Contribution Act (FICA) taxes to the IRS, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

            According to Stickler’s plea agreement, he owned and operated a company in Reno called Faith Based Solutions from 1999 to 2009.  Stickler collected and withheld employment and FICA taxes from his employees’ wages, but failed to pay them over to the IRS.  Stickler pleaded guilty to failing to pay $17,389.25 in employment and FICA taxes for the fourth quarter of tax year 2007, but the plea agreement states that Stickler also admitted to willfully failing to pay over employment and FICA taxes to the IRS for other periods during the tax years 2006 through 2010, and that the total tax loss that can be used for sentencing purposes is $100,899.90. 

In a separately filed federal case, Stickler was convicted by a jury on March 24 of theft of public money.  The evidence presented to the jury in that case was that in 2007, Stickler’s company, Faith Based Solutions, received $500,000 in federal grant money to teach non-profit organizations how to apply for federal government grants.  Stickler drew down all of the grant funds in the first seven months of the grant period, and instead of distributing the money to sub-grantees, he put it in accounts that he controlled and used it to pay large salaries to himself and family members, to take elaborate vacations, and for other items that were not approved by the grant.

Sentencing in both cases will be on Feb. 9, 2015, at 9:00 a.m. before U.S. District Judge Miranda M. Du.

The cases were investigated by IRS Criminal Investigation and the U.S. Department of Health and Human Services Office of Inspector General.  They are being prosecuted by Assistant U.S. Attorney Carla B. Higginbotham.

    LAS VEGAS, Nev. – Denise J. Vick, 39, of Las Vegas, pleaded guilty on Tuesday, Nov. 4, 2014, before U.S. District Judge Andrew P. Gordon to four counts of filing false claims with the IRS, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

            “Tax refund fraud is a growing problem locally and nationally,” said U.S. Attorney Bogden.  “This type of tax fraudster cheats honest and law abiding tax payers by defrauding the government and stealing funds that are not rightfully theirs.  We will continue working with the IRS in Nevada to identify and prosecute these fraudsters.”

            According to the plea agreement, during 2010 and 2011, Vick created and caused to be filed false and fraudulent tax returns for herself and others for the tax years 2009 and 2010.  The returns reported wages, income and other information that was false, and caused the IRS to issue tax refunds to Vick and the others to which they were not entitled.  The refunds were issued on debit cards that Vick controlled.  In total, Vick fraudulently received $307,231 from the IRS as a result of the false claims that she submitted for herself and others.

Vick is scheduled to be sentenced on March 5, 2015, and faces up to five years prison and a fine of up to $250,000 on each count.                   

The case was investigated by IRS Criminal Investigation and prosecuted by Assistant U.S. Attorney Kathryn C. Newman.

     LAS VEGAS, Nev. – Assistant U.S. Attorney (AUSA) Sarah E. Griswold will lead the efforts of the U.S. Attorney’s Office for the District of  Nevada in connection with the Justice Department’s nationwide Election Day Program for the upcoming Nov. 4, 2014 general elections, announced U.S. Attorney Daniel G. Bogden.  AUSA Griswold has been appointed to serve as the District Election Officer (DEO) for the District of Nevada, and in that capacity is responsible for overseeing the District’s handling of complaints of election fraud and voting rights abuses in consultation with Justice Department Headquarters in Washington.  
                                                                                               
            United States Attorney Bogden said, “Every citizen must be able to vote without interference or discrimination and to have that vote counted without it being stolen because of fraud.  The Department of Justice will act promptly and aggressively to protect the integrity of the election process.”

            The Department of Justice has an important role in deterring election fraud and discrimination at the polls, and combating these violations whenever and wherever they occur.  The Department’s long-standing Election Day Program furthers these goals, and also seeks to insure public confidence in the integrity of the election process by providing local points of contact within the Department for the public to report possible election fraud and voting rights violations while the polls are open on Election Day. 

Federal law protects against such crimes as intimidating or bribing voters, buying and selling votes, impersonating voters, altering vote tallies, stuffing ballot boxes, and marking ballots for voters against their wishes or without their input.  It also contains special protections for the rights of voters and provides that they can vote free from acts that intimidate or harass them.  For example, actions of persons designed to interrupt or intimidate voters at polling places by questioning or challenging them, or by photographing or videotaping them, under the pretext that these are actions to uncover illegal voting may violate federal voting rights law.  Further, federal law protects the right of voters to mark their own ballot or to be assisted by a person of their choice.

            In order to respond to complaints of election fraud or voting rights abuses on Nov. 4, 2014, and to ensure that such complaints are directed to the appropriate authorities, U.S. Attorney Bogden stated that the U.S. Attorney’s Office, as part of the Nevada Election Integrity Task Force, will be working with the Nevada Secretary of State, the Nevada Attorney General, the Las Vegas Metropolitan Police Department, and the FBI to investigate complaints regarding questionable voter registration practices, potential voter fraud, and enforcement of laws regarding voter intimidation.  On Election Day, there will be command posts in Carson City and Las Vegas staffed by members of the Task Force.  Additionally, AUSA/DEO Griswold will be available while the polls are open on Nov. 4, 2014, to assist with the investigation of any complaints of election fraud or voting rights abuses, and to ensure that such complaints are directed to the appropriate authorities.  AUSA Carla Higginbotham will be available in Reno to assist with any complaints in the northern Nevada area.

Law enforcement officials, election workers and citizens can file complaints in a number of ways.

1) By Completing the Election Law Violation Form on the NV Secretary of State's website, http://nvsos.gov/index.aspx?page=256;

2) By calling the NV Secretary of State at (775) 684-5705; or

3) By calling the FBI in Las Vegas at (702) 385-1281 and asking for Special Agent Michael B. Elliott.

4) Complaints about possible violations of the federal voting rights laws can be made directly to the Civil Rights Division’s Voting Section in Washington by phone at 1-800-253-3931 or (202) 307-2767, by fax at (202) 307-3961, by email to voting.section@usdoj.gov or by complaint form at ;

     LAS VEGAS, Nev. –The last of four defendants who participated in the high speed robberies of four Las Vegas convenience stores during April 2012, was sentenced to prison this week, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

            Michael Hall, 28, of Las Vegas, was sentenced by U.S. District Judge Jennifer A. Dorsey on Monday, Oct. 20, 2014, to 194 months in prison and five years of supervised release.  Hall pleaded guilty on Feb. 19, to four counts of interference with commerce by robbery and one count of brandishing a firearm in furtherance of a crime of violence.

            “We are working with our local police departments to prosecute federally deserving defendants who use guns to commit store robberies,” said U.S. Attorney Bogden. “Fortunately more victims were spared and this robbery spree was terminated because of excellent police work by the Las Vegas Metropolitan Police Department and the alert officer who observed the last robbery and chased down the defendants by car and on foot.”

             Hall was the getaway driver for each of the robberies that occurred between about 4:00 and 4:30 p.m. on April 6, 2012, causing law enforcement to dub the crimes the “30 minutes or less” series.  Hall’s co-defendants, Delon Hunter, 18, William Bonaparte, 24, and Erica Bowden-Payne, 26, all pleaded guilty and were sentenced to prison. In each robbery, Hunter pointed a handgun at Bonaparte, who was posing as a customer.  Hunter threatened to shoot Bonaparte if the store employee did not turn over money and other items. A Las Vegas Metropolitan Police Officer observed the last robbery in progress near Cheyenne Road and Buffalo Drive, and confronted the defendants as they were leaving the store. The defendants fled in the getaway vehicle driven by Hall, leading officers on a high speed chase before their vehicle came to a stop near Tenaya Way and Rainbow Boulevard. Three of the defendants fled on foot and were apprehended nearby. The fourth defendant, Bowden-Payne, remained in the vehicle and was apprehended there.        

The case was investigated by the FBI Safe Streets Task Force and Las Vegas Metropolitan Police Department and prosecuted by Assistant U.S. Attorney Cristina D. Silva. The case was screened through the Southern Nevada Project Safe Neighborhoods Task Force, a team of federal and local law enforcement officers and prosecutors who meet on a regular basis to discuss arrests involving guns and explosives. Project Safe Neighborhoods, also known as PSN, is a Department of Justice initiative and a nationwide commitment to reduce gun and gang crime in America.

     LAS VEGAS, Nev. – A Huntington Beach, Calif. man who defrauded the IRS of almost $800,000 in a false income tax refund scheme, was sentenced today to 21 months in prison and ordered to pay restitution to the government, announced U.S. Attorney Daniel G. Bogden for the District of Nevada and Special Agent in Charge John Collins of IRS Criminal Investigation for Nevada.

            Judas Godina, 39, was sentenced by U.S. District Judge Kent J. Dawson. Godina was indicted in July 2013 and pleaded guilty on July 15, 2014, to one count of conspiracy to defraud the IRS. He must report to federal prison by Jan. 16, 2015.

            “This type of tax crime harms every U.S. citizen and resident,” said U.S. Attorney Bogden. “We will aggressively work with the IRS to prosecute these cases, and will also recommend prison sentences in order to deter others from this type of fraud.”

“The substantial sentence of imprisonment and restitution handed down today on this case makes it clear that filing false claims for tax refunds is a serious crime,” said Special Agent in Charge Collins.  “IRS Criminal Investigation, with the assistance of our law enforcement partners and federal prosecutors, will aggressively pursue these violations of the law and protect the integrity of the tax system and honest taxpayers.”

According to the guilty plea agreement, from about January through December 2010, Godina conspired with Felix and Walter Guzman to defraud the IRS through a false income tax refund scheme. Godina recruited customers in Las Vegas into the tax return scheme by telling them that he could prepare their individual income tax returns and generate large refunds for them. Godina requested their identification information and tax returns from prior years, and then prepared the fraudulent tax returns using the information they provided, along with fraudulent W-2’s and Schedule E’s for business losses that he created. Godina transmitted or caused to be submitted the fraudulent forms to the IRS and monitored the status of the refunds.  When the customers received the refunds, Godina arranged to meet them and demanded payment of approximately one-half of the refund.  Godina also offered to pay a finder’s fee to customers who referred other paying customers to him and prepared fraudulent tax returns for customers recruited by co-defendants Felix and Walter Guzman.  Using this fraudulent scheme, Godina admitted that his conduct resulted in $791,666 in fraudulent refunds being issued by the IRS. The Guzman’s are currently fugitives and the charges against them are unresolved.

The case was investigated by IRS Criminal Investigation and prosecuted by Assistant U.S. Attorney Kathryn C. Newman.

     RENO, Nev. - A man who supervised and directed an illegal drug distribution operation in Reno from his home in southern California, was sentenced on Monday, Oct. 20, to 19½ years in federal prison and five years of supervised release, announced U.S. Attorney Daniel G. Bogden, for the District of Nevada.

Rosendo Salgado, 42, of Montclair, Calif., who was convicted by a jury on July 18 of one count of conspiracy to distribute methamphetamine, one count of money laundering conspiracy, and one count of illegal use of a communication facility, was sentenced by U.S. District Judge Larry R. Hicks.

“This defendant was no amateur drug trafficker and made a personal choice to engage in the trafficking of large amounts of almost pure methamphetamine over an extended period of time,” said U.S. Attorney Bogden.  “He showed his leadership of, experience and command of the conspiracy by using lower-ranking members to make hand-to-hand sales and use of coded language to track sales.”

According to court records and evidence admitted at trial, beginning in January 2013 pursuant to a court authorized wiretap, law enforcement officials intercepted telephone calls of Salgado discussing the methamphetamine distribution operation in the Reno area with co-conspirators.  The investigation continued, with Salgado observed meeting his co-conspirators in Reno.  On May 12, 2013, officials discovered from additional intercepted telephone calls of Salgado’s telephone, that a supply of methamphetamine from Salgado would be arriving that day in Reno via a vehicle courier, with the drugs secreted in the back door of the vehicle.  Investigators conducted surveillance outside the Reno home where the methamphetamine was delivered, and observed two co-conspirators removing a panel from the back passenger door of a white Toyota bearing California license plates.  That evening, investigators executed a federal search warrant at the home and recovered a firearm and two pounds of pure methamphetamine. Two days later, Salgado was arrested and charged by federal criminal complaint in California.

At sentencing, the court found that Salgado was an organizer, leader, manager or supervisor of the methamphetamine distribution conspiracy based upon the evidence, including intercepted calls, revealing Salgado’s instruction to his co-conspirators on a number of operational matters, including how to locate the concealed drugs that had been delivered to them, how much to sell the drugs for, where to deposit the drug proceeds, and how to use coded language to keep tallies of sales.  The co-conspirators who resided in Reno were prosecuted and convicted by the Washoe County District Attorney’s Office.

The case was prosecuted by Assistant U.S. Attorneys James E. Keller and Megan M. Rachow and investigated by the DEA, Northern Nevada High Intensity Drug Trafficking Area (HIDTA) Task Force, and Washoe County Sheriff’s Department.

     LAS VEGAS, Nev.  – Victor Bruce, M.D., 49, who operates Swan Lake Medical Center in Las Vegas, was sentenced this afternoon to 46 months in federal prison and three years of supervised release for writing prescriptions for oxycodone for persons he did not see or treat, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

            Bruce, who pleaded guilty in July to one count of conspiracy to distribute a controlled substance, was sentenced by U.S. District Judge Andrew P. Gordon. Bruce was permitted to self-report to federal prison by Jan. 16, 2015.

“Dr. Bruce repeatedly wrote prescriptions for highly addictive controlled substances for patients who did not need them, and for patients who did not appear at his medical practice or did not exist,” said U.S. Attorney Bogden.  “We continue to work with our local, state and federal law enforcement partners to put illegal pill-pusher doctors like Dr. Bruce in prison and out of business.”

            According to Bruce’s guilty plea agreement, he represents himself to be a pain management specialist and is the only physician working at the practice.  Beginning at a date unknown and continuing to around November 2013, Bruce and several co-conspirators, including Robert Wolfe, aka “old man,” Millicent Epino, Dylan DuBois, Jennifer Monge, and Jade Lepoma, conspired to distribute oxycodone. Wolfe would provide Bruce a list of names, and Bruce would write prescriptions for oxycodone for those names and give them to Wolfe.  Bruce also created “dummy” medical records for those persons, to make it appear as if a legitimate patient encounter had taken place.  On four occasions in June 2013, an undercover law enforcement officer purchased Bruce-written oxycodone prescriptions from Wolfe for $700 each. On each occasion, the undercover provided Wolfe or another co-conspirator with copies of Nevada driver’s licenses bearing the names of customers.  Usually within a day, Wolfe or another co-conspirator would then provide the undercover with written prescriptions for oxycodone.  Bruce knew he was writing prescriptions for controlled substances to customers he did not treat and who did not need the prescriptions.  None of the prescriptions were issued for a legitimate medical purpose or in the usual course of profession practice.

            According to the Nevada State Board of Medical Examiners, Bruce’s license to practice medicine in Nevada is still active; however, there is a pending board action against him related to the unlawful administering, dispensing or prescribing of controlled substances.

            Wolfe and several of the other co-conspirators were also charged in the drug conspiracy.

            This case was investigated by the Nevada High Intensity Drug Trafficking Area (Nevada HIDTA) Pharm-Net Task Force, including the DEA, IRS Criminal Investigation, Las Vegas Metropolitan Police Department, Henderson Police Department, North Las Vegas Police Department, and the Nevada Division of Investigations, and prosecuted by Assistant U.S. Attorneys Crane M. Pomerantz and Cristina D. Silva.

     LAS VEGAS, Nev.  – Mahesh Kuthuru, M.D., 46, of Henderson, Nev. was arraigned by a federal magistrate judge this afternoon and pleaded not guilty to felony drug distribution charges that he unlawfully sold highly addictive prescription painkillers to persons who did not have a medical necessity for them, announced U.S. Attorney Daniel G. Bogden for the District of Nevada. 
                                                  
            Kuthuru is charged in a criminal indictment with nine counts of unlawful distribution of controlled substances.  If convicted, he faces not more than 20 years in prison and a fine of up to $1 million.  U.S. Magistrate Judge Cam Ferenbach released Kuthuru on a personal recognizance bond pending trial.

            “Deaths from drug overdose, the majority from pharmaceuticals, have been rising steadily over the past two decades and have now become the leading cause of injury death in the United States,” said U.S. Attorney Bogden. “The number of overdose deaths combined with the costs to the workplace and healthcare and criminal justice systems, is cause for great alarm. We will continue to prosecute doctors who are contributing to this enormous problem.”

            According to the indictment, Kuthuru is a licensed physician in Nevada who represents himself to be a specialist in pain management.  Kuthuru operates Desert Pain Management which has occupied various locations on Charleston Boulevard in Las Vegas.  Beginning on a date unknown and continuing through at least 2013, Kuthuru allegedly sold prescriptions for large quantities of highly addictive frequently diverted prescription drugs, including oxycodone, morphine sulfate and methadone without medical necessity.   

            This case is being investigated by the Nevada High Intensity Drug Trafficking Area (Nevada HIDTA) Pharm-Net Task Force, including the DEA, IRS Criminal Investigation, Las Vegas Metropolitan Police Department, Henderson Police Department, North Las Vegas Police Department, and the Nevada Division of Investigations, and is being prosecuted by Assistant U.S. Attorney Crane M. Pomerantz.

An indictment contains only charges and is not evidence of guilt. The defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

     LAS VEGAS, Nev. – Saul Candelorio Gastellum-Sanchez, a local illegal drug dealer, was sentenced today by U.S. District Judge Lloyd D. George to 15 years in prison and five years of supervised release, announced Daniel G. Bogden, United States Attorney for the District of Nevada.

            Gastellum-Sanchez, aka “Cervancio Perez-Zazueta,” aka “Bartolo Castillo,” aka “Vampiro,” 29, pleaded guilty in May to one count of conspiracy to distribute methamphetamine, one count of possession of methamphetamine with the intent to distribute, one count of possession of a firearm during and in relation to a drug trafficking crime, unlawful re-entry of a deported alien, and conspiracy to launder monetary instruments.

            “The defendant was a prolific drug trafficker who was distributing large quantities of methamphetamine and had firearms at hand,” said U.S. Attorney Bogden. “He was a serious threat to public safety and a lengthy sentence of imprisonment was warranted.”

            According to Gastellum-Sanchez’ plea agreement, from about June 1, 2012, to June 20, 2013, Gastellum-Sanchez conspired with six co-defendants to distribute 464 grams of methamphetamine to an undercover officer.  On May 20, 2013, Gastellum-Sanchez purchased an ATV for $11,000 in cash, which were proceeds from the sale of methamphetamine. 

On June19, 2013, a federal search warrant was executed at Gastellum-Sanchez’ residence in Las Vegas, and law enforcement agents recovered over two kilograms of methamphetamine, an AK-47 assault rifle and two semi-automatic handguns.  At the time of the crime, Gastellum-Sanchez was residing unlawfully in the United States and had been previously deported in January 2008.

Four of the co-defendants pleaded guilty and were sentenced to prison, one is a fugitive, and one is pending trial.

           This case was investigated by the DEA, Homeland Security Investigations, IRS Criminal Investigation, and the North Las Vegas Police Department, and prosecuted by Assistant U.S. Attorney Amber M. Craig.

     RENO, Nev. – John Thomas Abrams, 47, aka Buck, aka David George Garnett, aka John McDonald, aka David Blackwell, appeared before a federal magistrate judge today and pleaded not guilty to charges that he kidnapped a 15-year-old boy and girl in California and transported them to Reno with the intent that the girl engage in sexual activity, announced Daniel G. Bogden, United States Attorney for the District of Nevada.
           
            Abrams is charged in a criminal indictment with two counts of kidnapping and one count of transportation of a minor for illegal sexual activity.  Abrams was ordered detained pending trial, which was set for Dec. 1, 2014.  If convicted, Abrams faces a minimum of 20 years in prison on the kidnapping charges, a minimum of 10 years in prison on the transportation charge, as well as fines of up to $250,000 on each count.

            According to the allegations contained in the indictment, between about July 12 and July 22, 2012, Abrams kidnapped the girl and the boy in the Sacramento, Calif. area, and held them for ransom, reward, and otherwise. Abrams then transported them to Reno, Nev. with the intent that the girl engage in illegal sexual activity.

            “Investigating persons who prey on minors, elderly, and other vulnerable victims, is a top priority of the Justice Department and U.S. Attorney’s Office in Nevada,” said U.S. Attorney Bogden.  “We have dedicated more resources than ever to catching and prosecuting these predators, and are working with local, state and federal partners to make sure they face the criminal justice system.”

The investigation is being conducted by the FBI and the Sacramento Police Department. The case is being prosecuted by Assistant United States Attorney Carla Higginbotham.

The case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal
Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals, federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project
Safe Childhood, please visit www.usdoj.gov/psc.  For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."

The public is reminded that an indictment contains only charges and is not evidence of guilt.  The defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

      LAS VEGAS, Nev. – Two men have been charged with conspiracy and fraud for engaging in a scheme to misappropriate $34 million from two Florida-based hedge funds during 2008 to 2010, announced Daniel G. Bogden, United States Attorney for the District of Nevada.

            Robert Buckhannon, 53, of Las Vegas, and Terry Rawstern, 66, of Aberdeen, S.D., are charged in a criminal indictment with one count of conspiracy to commit wire fraud and one count of wire fraud.  Buckhannon, who was arrested by FBI agents yesterday in Henderson, Nev., pleaded not guilty this afternoon at an arraignment before U.S. Magistrate Judge George Foley, and was released on a personal recognizance bond pending trial.  Rawstern’s arraignment is scheduled for tomorrow, Oct. 2 at 3:00 p.m.  If convicted, the defendants face up to 30 years in prison on the conspiracy charge, up to 20 years in prison on the wire fraud charge, and fines of up to $1 million on each count.

            “We have been working with our federal, state and local partners to investigate and prosecute persons who commit significant financial crimes,” said U.S. Attorney Bogden.  “Often these cases take considerable time and resources to investigate and litigate, but the American people deserve to know that we are working diligently to catch the perpetrators.”

            According to the indictment, from April 2008 through April 2010, Buckhannon and Rawstern and co-conspirators were managing members of two Bradenton, Florida-based hedge funds, Arcanum Equity Fund, LLC and Vestium Equity Fund, LLC. The defendants allegedly engaged in a fraudulent scheme to misappropriate $34 million they raised from investors by misrepresenting how they would use the investors’ funds and misrepresenting that there were safeguards over the investors’ money, such as an independent trustee and independent fund administrator.  The defendants then looted and bankrupted the hedge funds by taking payments on false and fictitious profits and taking improper and undisclosed loans.  The indictment states that as a result of the defendants’ conduct, investors lost approximately $13.1 million.  In April 2010, the hedge funds voluntarily filed for Chapter 7 bankruptcy and are now under the control of court-appointed trustees.

The case is being investigated by the FBI, and prosecuted by Assistant U.S. Attorney Kathryn C. Newman.

This prosecution is part of efforts underway by President Barack Obama’s Financial Fraud Enforcement Task Force.  President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes.  The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources.  The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets and recover proceeds for victims of financial crimes.  For more information about the task force visit: www.stopfraud.com.

      LAS VEGAS, Nev. – Daniel G. Bogden, United States Attorney for Nevada, in conjunction with the U.S. Department of Justice Office of Community Oriented Policing Services (COPS), is pleased to announce that on Monday, Sept. 29, the U.S. Department of Justice awarded three grants totaling $2,125,000 to the North Las Vegas Police Department, the City of Elko, and the Elko County Sheriff’s Office for the hiring of 17 law enforcement officers.

The Justice Department announced the funding awards to the three agencies under the COPS Hiring Program, which provides funds directly to law enforcement agencies to hire or re-hire career law enforcement officers, and to increase their community policing capacity and crime prevention efforts.  The program provides salaries and benefits for officer and deputy hires for three years. Grantees for the 2014 hiring program were selected based on their fiscal needs, local crime rates, and community policing plans.

“The COPS Office is pleased to assist local law enforcement agencies throughout the country in addressing their most critical public safety issues,” said Ronald L. Davis, Director of the COPS Office. “Funding from this year’s program will allow many cities and counties to apply new sworn personnel to issues related to violent crime, property crime, and school safety.”

Nearly $124 million in grants was awarded nationally under the hiring program, including the $2.1 million for the District of Nevada. Of that, $1.6 million was awarded to the North Las Vegas Police Department for the hiring of 13 officers, $375,000 was awarded to the Elko County Sheriff’s Office for the hiring of three officers, and $125,000 was awarded to the City of Elko for the hiring of one officer.

“The Department of Justice continues to support the efforts of law enforcement in Nevada,” said U.S. Attorney Bogden.  “This program is specifically designed to advance public safety through community policing, including the hiring of school police officers or school resource officers.  Bullying, stalking and other interpersonal crimes affect our children at an alarming rate, making these positions more important than ever.”

The COPS Office is a federal agency responsible for advancing community policing nationwide. Since 1995, COPS has awarded over $14 billion to advance community policing, including grants awarded to more than 13,000 state, local, and tribal law enforcement agencies to fund the hiring and redeployment of approximately 125,000 officers and provide a variety of knowledge resource products including publications, training, and technical assistance.

For the entire list of grantees and additional information about the 2014 COPS Hiring Program, visit the COPS website at www.cops.usdoj.gov.

       LAS VEGAS, Nev. – Las Vegas urologist, Michael Stanley Kaplan, 59, was convicted by a federal jury today of conspiracy to commit adulteration for re-using single use needle guides during prostate procedures, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.

“Dr. Kaplan made a decision to re-use needle guides in a manner that caused them to be adulterated for the purpose of enriching himself,” said U.S. Attorney Bogden. “He also concealed from his patients that they were undergoing procedures with re-used needle guides.  Such conduct is a felony when performed with the intent to defraud or mislead. This case underscores our commitment to holding accountable those medical professionals who would endanger patients for their own personal profit.”

At the time of the offense, Dr. Kaplan operated Green Valley Urology. According to the evidence presented at trial, Kaplan re-used single-use plastic needle guides during prostate procedures, causing a significant health risk to his patients. The packaging on each needle guide clearly warned that they should not be used more than once, but Dr. Kaplan instructed his staff and permitted his staff to re-use them three to five times prior to disposal.  Between about Dec. 15, 2010, and March 11, 2011, Dr. Kaplan performed approximately 120 procedures requiring a needle guide but used less than 10 guides during that period. 

Dr. Kaplan was acquitted of making false representations to Food and Drug Administration (FDA) investigators regarding the duration of his re-use of the needle guides.

            Dr. Kaplan is released on a personal recognizance bond and is scheduled to be sentenced on Jan. 30, 2015.  He faces up to five years in prison and a fine of up to $250,000.

The case was investigated by the FDA Office of Criminal Investigations and prosecuted by Assistant U.S. Attorney Crane M. Pomerantz and Special Assistant U.S. Attorney Peter J. Leininger.

       LAS VEGAS, Nev. - A Henderson, Nev. man was sentenced today to two years in prison for aiming a laser pointer at a Las Vegas Metropolitan Police Department (LVMPD) helicopter on six occasions earlier this year, announced Daniel G. Bogden, United States Attorney for the District of Nevada. 

            James David Zipf, 30, pleaded guilty in June to one count of aiming a laser pointer at an aircraft, and was sentenced by U.S. District Judge Miranda M. Du.  Zipf was permitted to self-report to federal prison by December 30, and must also serve three years of supervised release and undergo mental health and substance abuse treatment.

Zipf admitted that just after midnight on Jan. 30, 2014, he aimed a blue laser four times at the LVMPD helicopter from the second story window of the Green Valley neighborhood house where he lived.  Zipf also admitted that on Feb. 3, 2014, at about 9:00 p.m., he pointed the blue laser light two times at a LVMPD helicopter causing one of the flight officers to experience a severe headache. Zipf was convicted in 2011 in Phoenix, Ariz. of pointing a similar blue laser at a police helicopter there. 

            “In 2012, it became a federal felony offense to knowingly target an aircraft with a laser,” said U.S. Attorney Bogden. “This activity is extremely dangerous, and can disorient and temporarily blind a pilot.  If you have information about a lasing incident or see someone pointing a laser at an aircraft, call your local FBI field office or dial 911.”

  Since the FBI and the Federal Aviation Administration (FAA) began tracking laser strikes in 2005, statistics reflect a more than 1,100 percent increase in the deliberate targeting of aircraft by people with handheld lasers.  In 2013, there were 3,960 laser illumination incidents reported by pilots to the FAA. This is an average of 10.8 incidents every night.

The case was investigated by the FBI and LVMPD, and prosecuted by Assistant U.S. Attorney Roger Yang.   

        LAS VEGAS, Nev. – Clark County Family Court Judge Steven E. Jones and four co-defendants pleaded guilty today to conspiracy charges for defrauding over 22 people of millions in an investment fraud scheme involving bogus water rights and real estate transactions, announced U.S. Attorney Daniel G. Bogden for the District of Nevada and Laura Bucheit, Special Agent in Charge of the FBI for Nevada. As part of his plea agreement with the government, Jones agreed to step down from the bench and surrender his law license to the State Bar of Nevada.

Jones, 56, Thomas A. Cecrle, Jr., 57, and Terry J. Wolfe, 59, of Henderson, Nev., and Mark L. Hansen, 56, of Corvallis, Ore., pleaded guilty before U.S. District Judge Jennifer A. Dorsey to one count of conspiracy to commit wire fraud.  Also in connection with the same fraud scheme, Constance C. Fenton, 70, of Gig Harbor, Wash., pleaded guilty to one count of conspiracy to commit money laundering.  They each face up to 20 years in prison, $250,000 in fines, and mandatory restitution, and are scheduled to be sentenced on Jan. 26, 2015.  A sixth defendant charged in the scheme, Ashlee M. Martin, 30, of Las Vegas, Nev., pleaded guilty on Aug. 11 to conspiracy to commit money laundering, and is scheduled to be sentenced in August 2015.   

“This prosecution was the result of a long, thorough, and resource-intensive investigation and should serve as a vivid reminder that public officials who use their offices as a means to commit a crime of whatever nature will be pursued vigorously and prosecuted to the utmost rigor of the law,” said U.S. Attorney Bogden. “Defendant Jones knowingly used his office to lull victims into a false sense of security about investments he knew were scams.  No one is above the law, especially a person holding the office of judge.” 

"These guilty pleas serve as evidence to the public that the FBI, working with our law enforcement partners and the U.S. Attorney’s Office, will continue to ensure that no one is above the law, and when public corruption is identified, it will be aggressively investigated and prosecuted,” said Special Agent in Charge Bucheit.

 According to the plea memoranda, defendants lured victims into a fraud scheme by falsely telling them that Cecrle worked as a contractor for the U.S. Department of Homeland Security, purchasing and selling water rights worth millions of dollars as part of a secret government program.  The co-conspirators then solicited money by falsely claiming that Cecrle needed short-term cash loans to complete his phantom water deals, loans he promised to repay in short order along with a very large return.  Cecrle and his co-conspirators concocted a similar story involving a land deal on the Las Vegas Strip where Cecrle needed short-term loans to supposedly close a deal with Sir Richard Branson.  In truth, however, Cecrle held no position with the federal government and there were no land or water rights deals.

Using his office as an elected state court judge, defendant Jones knowingly vouched for Cecrle and the legitimacy of the deals to potential investors when he knew the deals were, in fact, scams.  According to the plea memorandum, Jones continued to further the conspiracy by receiving money from a victim in the parking lot of the Family  Division Courthouse, meeting with at least one potential investor in his chambers and elsewhere in the courthouse to discuss the investment,  obtaining an “Own Recognizance” bond to release Cecrle from custody after he was arrested for bad checks he had passed to a victim, and opening and maintaining a joint checking account with Cecrle, through which flowed over $260,000 in illegal proceeds.  During the entire conspiracy, which lasted from about September 2002 to October 2012, the defendants defrauded at least 22 victims of more than $2.6 million, money they quickly converted to their own use.

The case was investigated by the FBI and prosecuted by First Assistant U.S. Attorney Steven W. Myhre and Assistant U.S. Attorney Daniel R. Schiess of the U.S. Attorney’s Office for the District of Nevada.

This prosecution is part of efforts underway by President Barack Obama’s Financial Fraud Enforcement Task Force.  President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes.  The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources.  The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets and recover proceeds for victims of financial crimes.  For more information about the task force visit: www.stopfraud.com.

        LAS VEGAS, Nev. – Former Las Vegas physician Vinay Bararia, 44, was sentenced today to 44 months in prison and three years of supervised release for unlawfully selling hydrocodone and oxycodone to an undercover DEA agent in a hospital parking lot, announced Daniel G. Bogden, United States Attorney for the District of Nevada. 

            “Stopping the unlawful distribution of prescription painkillers has been a top priority for our office,” said U.S. Attorney Bogden.  “The days of persons being able to easily acquire these dangerous drugs from corrupt doctors and pharmacists are coming to an end.”       

The sentence was imposed by U.S. District Judge Jennifer Dorsey, who also ordered Bararia to forfeit approximately $50,000 in cash and the 2007 Jaguar vehicle he used to distribute the drugs, and increased his sentence for abusing his position of trust as a doctor.  

Judge Dorsey denied Bararia’s request for a reduced sentence based on arguments by his attorneys that he had diminished mental capacity, extenuating family circumstances, or that he acted aberrantly when he committed the crime.

Bararia was originally charged in March 2012, and pleaded guilty on Dec. 18, 2013, to one count of distribution of a controlled substance.  According to the guilty plea agreement, on July 20, 2011, Bararia unlawfully sold 500 hydrocodone pills for $1125 to a DEA undercover agent in the parking lot of Centennial Hills Hospital.  Bararia’s sentence included other relevant conduct, including the unlawful distribution of approximately 3,600 oxycodone pills between July 28 and Nov. 8, 2011, and the possession of 2,038 oxycodone pills that were recovered from his vehicle on March 1, 2012, when he was arrested in the parking lot of the hospital.  

Bararia has been in federal custody since November 2012, as a result of repeated violations of his conditions of release.  He surrendered his license to practice medicine in Nevada in March 2013.

            This case was investigated by the DEA and prosecuted by Assistant U.S. Attorneys Susan Cushman and Robert Knief.

        LAS VEGAS, Nev. – Anthony M. Cirulli, a former employee of a Las Vegas casino company, pleaded guilty today before U.S. District Judge Gloria M. Navarro to one count of tax evasion, announced U.S. Attorney Daniel G. Bogden for the District of Nevada. 

            “Individuals are required to pay federal taxes on income, even if acquired unethically,” said U.S. Attorney Bogden.  “If you do not pay the taxes, you risk an investigation by the IRS and criminal prosecution.” 

According to the plea agreement, from about 2005 to 2008, Cirulli was employed as a production manager in the corporate advertising department of the casino company.  Part of his job involved reviewing bids for printing contracts and deciding which printing companies would be awarded the contracts.  For the 2007 tax year, Cirulli willfully filed a false individual income tax return, which omitted and failed to report income that he received during his employment at the company. Cirulli hid the unreported income in two different nominee bank accounts which conducted no actual business activity.  The potential tax loss to the U.S.Treasury as a result of Cirulli’s conduct is approximately $350,000.

Cirulli is scheduled to be sentenced on Dec. 18, and faces up to five years prison, three years of supervised release, and a fine of up to $250,000.            

The case was investigated by IRS Criminal Investigation and prosecuted by Trial Attorney Christopher Maietta of the Justice Department’s Tax Division and Assistant U.S. Attorney Nicholas Dickinson.

         LAS VEGAS, Nev. – A local lawyer who served as U.S. Attorney for Nevada from 1975 to 1977, pleaded guilty today to failing to file federal individual and corporate income tax returns from 2006 to 2010, and agreed to pay restitution to the IRS of approximately $290,000, announced Daniel G. Bogden, United States Attorney for the District of Nevada. 

            “Regardless of one’s occupation, job title or position, everyone is responsible for filing and paying taxes on all of their income,” said United States Attorney Bogden.  “It is important that American taxpayers understand and feel confident that everyone is playing by the same rules in filing and paying their taxes.”

Lawrence J. Semenza, II, pleaded guilty before U.S. District Judge James C. Mahan to three misdemeanor counts of willful failure to file a tax return. According to the guilty plea agreement, Semenza operated his law practice in Las Vegas as a subchapter C personal service corporation. For the years 2006 through 2010, Semenza individually had taxable income of approximately $655,000, and the corporation had taxable income of approximately $345,000, but Semenza failed to file individual or corporate income tax returns for those years, and failed to pay the tax due and owing to the IRS, totaling about $290,000.

            Semenza is scheduled to be sentenced on Dec. 3, 2014.  The maximum penalty for each count is one year in prison and a fine of not more than $100,000.

The case is being investigated by IRS Criminal Investigation and prosecuted by Assistant U.S. Attorneys Eric Johnson and Nicholas D. Dickinson.

         LAS VEGAS, Nev. – A local lawyer who served as U.S. Attorney for Nevada from 1975 to 1977, pleaded guilty today to failing to file federal individual and corporate income tax returns from 2006 to 2010, and agreed to pay restitution to the IRS of approximately $290,000, announced Daniel G. Bogden, United States Attorney for the District of Nevada. 

            “Regardless of one’s occupation, job title or position, everyone is responsible for filing and paying taxes on all of their income,” said United States Attorney Bogden.  “It is important that American taxpayers understand and feel confident that everyone is playing by the same rules in filing and paying their taxes.”

Lawrence J. Semenza, II, pleaded guilty before U.S. District Judge James C. Mahan to three misdemeanor counts of willful failure to file a tax return. According to the guilty plea agreement, Semenza operated his law practice in Las Vegas as a subchapter C personal service corporation. For the years 2006 through 2010, Semenza individually had taxable income of approximately $655,000, and the corporation had taxable income of approximately $345,000, but Semenza failed to file individual or corporate income tax returns for those years, and failed to pay the tax due and owing to the IRS, totaling about $290,000.

            Semenza is scheduled to be sentenced on Dec. 3, 2014.  The maximum penalty for each count is one year in prison and a fine of not more than $100,000.

The case is being investigated by IRS Criminal Investigation and prosecuted by Assistant U.S. Attorneys Eric Johnson and Nicholas D. Dickinson.

         RENO, Nev. – United States Attorney Daniel G. Bogden this week welcomed members of the Nevada Native American community network to the 18th Annual Native American Conference being held Aug. 25 through Aug. 27, 2014, at the Grand Sierra Resort in Reno.  Attendees include members of tribal government, tribal law enforcement, social workers, court personnel, and others.

“I take great pride in our work with Nevada Native American Tribes and in handling Indian Country matters,” said U.S. Attorney Bogden. “Our annual conference is one method we use to strengthen collaboration with our tribal partners.  This year’s conference, entitled “Working Together for Hope, Healing and Justice,” is intended to assist us in protecting our most precious resource – our children.”    

U.S. Attorney Bogden is assisted at the conference by his Criminal Chief Eric Johnson, Reno Branch Chief Sue Fahami, Assistant U.S. Attorney and tribal liaison Shannon Bryant, Assistant U.S. Attorney Carla Higginbotham, his victim witness staff, and law enforcement representatives from the FBI and Bureau of Indian Affairs.  Funding and additional assistance for the conference was provided by the U.S. Department of Justice Office for Victims of Crime. The agenda includes classes and speakers on a wide variety of subjects such as crisis response, bullying, child and youth sex abuse, interviewing child victims, child trafficking, Indian Country jurisdiction, and case studies in Indian Country. 

Nevada is home to 26 federally recognized Native American Tribes located on 31 reservations and colonies. For more information on the U.S. Attorney’s work with Nevada Indian tribes, visit http://www.justice.gov/usao/nv/programs_tribal.html.          

The Department of Justice released yesterday its second report to Congress entitled Indian Country Investigations and Prosecutions, which provides a range of enforcement statistics required under the Tribal Law and Order Act of 2010, as well as information about the progress of the Attorney General’s initiatives to reduce violent crime and strengthen tribal justice systems. For further information, see http://www.justice.gov/opa/pr/2014/August/14-ag-902.html

         LAS VEGAS, Nev.  – Assistant United States Attorney (AUSA) Kimberly Frayn of the U.S. Attorney’s Office for the District of Nevada and Special Agent Michael P. Adams of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) in Las Vegas, received awards today in Phoenix, Ariz., from the International Association of Financial Crimes Investigators for the investigation and prosecution of members of a highly sophisticated international cybercrime organization known as “Carder.su,” announced Daniel G. Bogden, United States Attorney for the District of Nevada and Michael Harris, Assistant Special Agent in Charge for HSI Las Vegas. 

            AUSA Frayn received the William D. Neumann Prosecutor of the Year Award for her efforts as the primary prosecutor in the Nevada case, known as, “Operation Open Market.”  The Award acknowledges prosecutors who have shown exceptional diligence, cooperation and tenacity, and who have made significant contributions to financial fraud prevention.

Special Agent Adams received the Cyber Investigations Contributor of the Year award for his efforts as the case agent in Operation Open Market. The Award acknowledges Agent Adams’ cyber investigative skills which significantly aided in the apprehension, arrest and prosecution of the suspects. 

“It pleases me that AUSA Frayn and Special Agent Adams have been recognized by an international association for their superior work and efforts in fighting financial fraud,” said U.S. Attorney Bogden. “The investigation and prosecution of a cybercrime case requires special skills and expertise, as well as diligence and tenaciousness of character. AUSA Frayn and Special Agent Adams have all of those qualities combined, which has led to successful court cases and convictions.”   

“These awards are richly deserved and reflect the extraordinary amount of work both the agent and prosecutor invested in this complex and far-reaching case,” said Assistant Special Agent in Charge Michael Harris. “There’s no question their collaborative efforts are in large measure responsible for the successful outcome of this investigation. For prosecutors and investigators, seeing career criminals like the defendants in this case brought to justice is its own reward, but having those efforts recognized in such a public way makes the outcome even more gratifying.”

Special Agent Adams assumed the identity as a member of the Carder.su organization when it was in its infancy.  The investigation determined that its members or “carders,” were involved in large scale trafficking of compromised credit card account data and counterfeit identifications and credit cards, as well as money laundering, narcotics trafficking, and various types of computer crime. The organization operated an internet web portal called a forum, where members could purchase the illicitly obtained data and share knowledge of various fraud schemes. A second forum was also created to vet incoming new members.  The forums were generally hosted within the former Soviet Union and the upper echelon of the organization resides within the former Soviet Union. It was estimated that in July 2011, there were over 5,500 members of the organization. Members of the organization had different roles, including moderators who directed other members in carrying out activities; reviewers who examined and tested products, services, and contraband; vendors who advertised and sold products, services and contraband; and members. Members were required to successfully complete a number of security features designed to protect the organization from infiltration by law enforcement or members of rival criminal organizations. 

Operation Open Market resulted in federal criminal charges against 56 individuals. The defendants are charged with conspiracy to participate in a racketeer influenced corrupt organization, trafficking in compromised credit card account data and counterfeit identifications, money laundering, narcotics trafficking, and computer crimes. To date, 25 individuals have been convicted, and the rest are either fugitives or are pending trial in Las Vegas. 

The International Association of Financial Crimes Investigators (IAFCI) is a non-profit organization with over 4,000 members whose mission is to identify and prevent financial crimes utilizing new technologies and investigative techniques.  The Association has 40 Chapters worldwide.

WASHINGTON – A northern California man who served as an information and document vendor in the identity theft and credit card fraud ring known as “Carder.su” was sentenced yesterday to serve 100 months in federal prison.  He was further ordered to pay approximately $50.5 million in restitution.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Daniel G. Bogden of the District of Nevada and Assistant Special Agent in Charge Michael Harris of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE HSI) in Las Vegas made the announcement.  U.S. District Judge Andrew P. Gordon of the District of Nevada imposed the sentence.

“Carder.su is a criminal organization, and we used the same mob-busting laws and investigative techniques we’ve used with other organized crime networks to dismantle the fraud ring,” said Assistant Attorney General Caldwell.  “The new face of organized crime is largely cyber-based, and this case demonstrates the department’s ability to pursue members of these organizations wherever we find them.” 

            “The structure of the Carder.su organization was sophisticated and designed to prevent attack by rival organizations and to avoid detection by law enforcement,” said U.S. Attorney Bogden.  “Its members had defined roles and were responsible for the theft of over $50 million.  We are working diligently with our law enforcement partners to ensure that the people who commit these high-tech crimes are put out of business.”

“As this multi-year sentence makes clear, individuals like this defendant who traffic in stolen identities and compromised credit card information should expect to face the full weight of the law,” said HSI Assistant Special Agent in Charge Harris. “This type of fraud has reached epidemic proportions and the economic fallout from these crimes affects us all.  HSI will continue to work closely with its law enforcement partners to see that those involved are brought to justice.”

Makyl Haggerty, aka “Wave” and “G5,” 24, of Oakland, Calif., admitted in his plea agreement that in December 2009, he became associated with the Carder.su organization, a criminal enterprise whose members trafficked in compromised credit card account data and counterfeit identifications, and committed money laundering, narcotics trafficking, and various types of computer crime.  Specifically, Haggerty operated as a vendor on the organization’s websites using the “Wave” and “G5” nicknames, and sold approximately 1,000 counterfeit identification documents and counterfeit credit cards to other Carder.su members.  Haggerty manufactured and sold counterfeit driver’s licenses for at least 15 states and British Columbia.  

Fifty-six individuals were charged in four separate indictments in Operation Open Market, which targeted the Carder.su organization.  To date, 25 individuals have been convicted and the rest are either fugitives or are pending trial.  Haggerty pleaded guilty in February to one count of participation in a racketeer influenced corrupt organization.   

The cases were investigated by HSI and the U.S. Secret Service, and are being prosecuted by Trial Attorney Jonathan Ophardt of the Criminal Division’s Organized Crime and Gang Section and Assistant U.S. Attorneys Kimberly M. Frayn and Andrew W. Duncan of the District of Nevada.

            This prosecution is part of efforts underway by President Barack Obama’s Financial Fraud Enforcement Task Force.  President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes.  The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources.  The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets and recover proceeds for victims of financial crimes.  For more information about the task force visit: www.stopfraud.com.

          LAS VEGAS, Nev. – U.S. Attorney Daniel G. Bogden and other federal law enforcement representatives last week held meetings with leaders and representatives of 21 northern Nevada Indian tribes, and conducted tours of their reservations, announced United States Attorney Daniel G. Bogden.

“We strive each year to improve communication and coordination with our tribal partners,” said U.S. Attorney Bogden.  “There is no quick fix to the public safety problems the tribes face, but my office, as well as the FBI, Bureau of Indian Affairs, DEA and other federal agencies, are committed to fighting crime and promoting justice on Nevada Indian lands.”

The four-day trip, which U.S. Attorney Bogden has been conducting on an annual basis for the last several years, is part of a national effort to establish regular and meaningful consultation and collaboration with tribal officials.  U.S. Attorney Bogden was joined on this year’s trip by his Criminal Chief, Eric Johnson, and Reno Branch Chief, Sue Fahami, as well as the Assistant Special Agent in Charge of the Bureau of Indian Affairs (BIA) for District III, Selanhongva McDonald, BIA Special Agent Molly Hernandez, BIA Supervisory Special Agent Clifford C. Serawop, DEA Resident Agent in Charge Jerry Miller, and FBI Special Agents Brian Keeney, Michael Spitzer, and David Elkington.

            The tribal consultation meetings were conducted from Monday, July 28 through Thursday, July 31, 2014, and included discussions about tribal issues, investigations, victim advocacy, training, outreach, public safety, and violence against women.

The group visited the Washoe Tribe of Nevada and California; the Carson Colony, Dresslerville, and Stewart Community Councils; Yerington, Walker River and Summit Lake Paiute Tribes; Reno-Sparks Indian Colony; Pyramid Lake Paiute Tribe; Fallon Paiute Tribe; Duckwater Sho-Pai Tribe; Ely Shoshone Tribe; Wells Band Council; Duck Valley Sho-Pai Tribe; South Fork Band Council; Elko Band Council; Elko Te-Moak Tribe; Battle Mountain Band Council; Winnemucca Colony Council; Fort McDermitt Paiute Shoshone Tribe; and Lovelock Paiute Tribe. The group plans to visit the remaining Nevada tribes and reservations later this year. 

In addition to the tribal lands consultation tour each year, the Nevada U.S. Attorney’s Office holds a state-wide Native American Conference.  This year’s conference, entitled “Working Together for Hope, Healing and Justice” is the 18th State-Wide Native American Conference and will be held Aug. 25 through Aug. 27, 2014, at the Grand Sierra Resort in Reno, Nev. The conference is open to tribal chairs, administrators and tribal members, social and health care workers, law enforcement, court personnel, and others who might benefit learning from a number of topics and issues impacting the tribes.

Nevada is home to 26 federally recognized Native American Tribes located on 31 reservations and colonies. For more information on the U.S. Attorney’s work with Nevada Indian tribes, visit http://www.justice.gov/usao/nv/programs_tribal.html.

          LAS VEGAS, Nev. – U.S. Attorney Daniel G. Bogden and other federal law enforcement representatives last week held meetings with leaders and representatives of 21 northern Nevada Indian tribes, and conducted tours of their reservations, announced United States Attorney Daniel G. Bogden.

“We strive each year to improve communication and coordination with our tribal partners,” said U.S. Attorney Bogden.  “There is no quick fix to the public safety problems the tribes face, but my office, as well as the FBI, Bureau of Indian Affairs, DEA and other federal agencies, are committed to fighting crime and promoting justice on Nevada Indian lands.”

The four-day trip, which U.S. Attorney Bogden has been conducting on an annual basis for the last several years, is part of a national effort to establish regular and meaningful consultation and collaboration with tribal officials.  U.S. Attorney Bogden was joined on this year’s trip by his Criminal Chief, Eric Johnson, and Reno Branch Chief, Sue Fahami, as well as the Assistant Special Agent in Charge of the Bureau of Indian Affairs (BIA) for District III, Selanhongva McDonald, BIA Special Agent Molly Hernandez, BIA Supervisory Special Agent Clifford C. Serawop, DEA Resident Agent in Charge Jerry Miller, and FBI Special Agents Brian Keeney, Michael Spitzer, and David Elkington.

            The tribal consultation meetings were conducted from Monday, July 28 through Thursday, July 31, 2014, and included discussions about tribal issues, investigations, victim advocacy, training, outreach, public safety, and violence against women.

The group visited the Washoe Tribe of Nevada and California; the Carson Colony, Dresslerville, and Stewart Community Councils; Yerington, Walker River and Summit Lake Paiute Tribes; Reno-Sparks Indian Colony; Pyramid Lake Paiute Tribe; Fallon Paiute Tribe; Duckwater Sho-Pai Tribe; Ely Shoshone Tribe; Wells Band Council; Duck Valley Sho-Pai Tribe; South Fork Band Council; Elko Band Council; Elko Te-Moak Tribe; Battle Mountain Band Council; Winnemucca Colony Council; Fort McDermitt Paiute Shoshone Tribe; and Lovelock Paiute Tribe. The group plans to visit the remaining Nevada tribes and reservations later this year. 

In addition to the tribal lands consultation tour each year, the Nevada U.S. Attorney’s Office holds a state-wide Native American Conference.  This year’s conference, entitled “Working Together for Hope, Healing and Justice” is the 18th State-Wide Native American Conference and will be held Aug. 25 through Aug. 27, 2014, at the Grand Sierra Resort in Reno, Nev. The conference is open to tribal chairs, administrators and tribal members, social and health care workers, law enforcement, court personnel, and others who might benefit learning from a number of topics and issues impacting the tribes.

Nevada is home to 26 federally recognized Native American Tribes located on 31 reservations and colonies. For more information on the U.S. Attorney’s work with Nevada Indian tribes, visit http://www.justice.gov/usao/nv/programs_tribal.html.

          LAS VEGAS, Nev. – A Las Vegas man was sentenced today to six months in prison, three years of supervised release, and six months of home confinement for falsifying vehicle emission test results for over 1,000 vehicles, announced Daniel G. Bogden, United States Attorney for the District of Nevada.

Henry Alberto Batista, 30, was sentenced by Senior U.S. District Judge Lloyd D. George, and he was permitted to self-surrender to prison by Oct. 3, 2014. Batista pleaded guilty in March to one count of making a false statement to a government agency.  Batista’s brother, Luis Batista, also pleaded guilty to making a false statement to a government agency, and was sentenced in May to time served and three years of supervised release.  Luis Batista served approximately seven months in prison and is now on home confinement.

“The Batista cases are a continuation of the District of Nevada’s efforts to prevent emissions fraud,” said U.S. Attorney Bogden.  “Ten individuals were convicted of this type of offense in Nevada between 2010 and 2012. We will continue to work with the EPA and our other law enforcement partners to protect the public and the environment.”

"Complete and accurate tests of vehicle emissions are necessary to reduce harmful air pollutants," said Jay M. Green, Special Agent in Charge of EPA's criminal enforcement program in Nevada.  "The violations in this case took place in Clark County, Nev., which has been designated a 'serious' nonattainment area for carbon monoxide from vehicle emissions.  Violators who submit false reports or incorrect data undermine EPA's commitment to protecting clean air for all Americans.” 

            According to the plea agreement, Batista was a licensed Nevada emissions inspector. Between July 2009 and Dec. 19, 2012, while he was working for a company in Las Vegas that was licensed by the Nevada Department of Motor Vehicles (DMV) to conduct emissions testing, he knowingly made false material statements, representations, or certifications in approximately 1600 records.  Batista falsified emissions certificates for vehicles that could not pass the emissions tests by using substitute vehicles that would pass the test or by using a computer programmed emulator to deceive the emissions analyzer into accepting data for the vehicle that could not pass the test.

The cases became a priority in 2008 when the DMV hired a contractor to build a vehicle identification database to find possible emissions testing fraud. DMV discovered that in 2008 alone, there were over 4,000 false vehicle emissions certificates issued in Las Vegas. The Database allows investigators to check the vehicle identification number that the emissions tester enters against the vehicle actually tested. The Clean Air Act requires Las Vegas and the surrounding Clark County, as part of their State Implementation Plan, to have emissions testing because the area is in serious non-attainment for carbon monoxide and ozone. The Batista case presented new challenges to Nevada DMV because of the sophisticated technology used by the Batistas which allowed them to use computer software to simulate the presence of a real vehicle and transmit false information to the emissions analyzer equipment.

The case was investigated by the EPA, Nevada DMV, and FBI. The case was prosecuted by Assistant United States Attorney Roger Yang and Senior Trial Attorney J. Ronald Sutcliffe of the Justice Department’s Environmental Crimes Section.

         LAS VEGAS, Nev. – A California accountant was sentenced today to 57 months in federal prison and ordered to pay approximately $1.1 million in restitution for her role in a mortgage fraud scheme in southern Nevada, announced Daniel G. Bogden, United States Attorney for the District of Nevada.

            Carmen Denise Mosley, 44, of Granada Hills, Calif., was sentenced by Senior U.S. District Judge Kent J. Dawson.  Mosley was convicted by a jury on May 6, 2014, of one count of conspiracy to commit bank and wire fraud and two counts of bank fraud.  She was permitted to self-report to prison by Nov. 3, 2014.

            “As we have seen time and time again, the persons who committed mortgage fraud in Nevada were primarily employed in the housing and mortgage loan industry,” said U.S. Attorney Bogden.  “They used special skills to commit these crimes, which are still impacting the Nevada economy today.”

            According to the court records and evidence introduced at trial, from about November 2006 to November 2007, Mosley, a certified public accountant, and co-defendant Zulfiya Karimova, 33, of, Cupertino, California, a loan officer, conspired to obtain mortgage loans from financial institutions by causing materially false information to be placed in the buyers’ mortgage loan applications and supporting documentation.  Using this scheme, Mosley and Karimova obtained money and property from the financial institutions by causing money from the loans to be disbursed to them at closing for their own use and benefit. Karimova caused buyers to apply for mortgage loans and caused their applications to contain false information about their income and assets.  Mosley provided fraudulent tax documents to support the fraudulent representations in the applications concerning the buyers’ income.  Mosley and Karimova caused the financial institutions to loan money to fund the purchase of three homes in the Las Vegas area during 2006 and 2007.  The buyers defaulted on the loans, causing more than $1 million in losses to the lenders. 

            Karimova pleaded guilty prior to trial to conspiracy to commit bank and wire fraud, and bank fraud, and is scheduled to be sentenced on Aug. 20, 2014.

            The case was investigated by the FBI and prosecuted by Assistant U.S. Attorneys Sarah E. Griswold and Kathryn C. Newman.

Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes.  With more than 20 federal agencies, 94 U.S. attorney’s offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud.  Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations.  Since the inception of FFETF in November 2009, the Justice Department has filed more than 12,841 financial fraud cases against nearly 18,737 defendants including nearly 3,500 mortgage fraud defendants.  For more information on the task force, visit www.stopfraud.gov.

          LAS VEGAS, Nev. – Federal charges have been filed against a man for robbing a Las Vegas bank on July 22 and a Las Vegas casino cashier’s cage on July 25, 2014, announced Daniel G. Bogden, United States Attorney for the District of Nevada.
           
            John Doe, also identified as Scott Carmitchel, is charged in a criminal complaint with one count of armed bank robbery and one count of interference with commerce by robbery, and is scheduled for an initial appearance at 3:00 p.m. on Thursday, July 31, 2014, before U.S. Magistrate Judge Peggy A. Leen.  

            According to the complaint, at about 8:55 a.m. on July 22, 2014, the defendant allegedly entered a bank on E. Tropicana Boulevard and used a gun with an orange tip to rob a teller.  Three days later, on July 25, 2014, at about 8:15 p.m., the defendant allegedly approached the main cashier cage at the casino and used a gun with an orange tip to rob a teller.  An investigation led to the apprehension of the defendant on July 27, 2014, in a room at another casino in Las Vegas. Law enforcement investigators recovered a large amount of money and a 6mm BB gun with an orange tip from the hotel room. 

The case is being investigated by the FBI and Las Vegas Metropolitan Police Department, and is being prosecuted by Assistant United States Attorney Robert A. Knief.

The public is reminded that a criminal complaint contains only charges and is not evidence of guilt.  The defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

          LAS VEGAS, Nev. On the second day of his federal jury trial, a Las Vegas Playboy Bloods street gang member pleaded guilty to racketeering and drug charges, announced U.S. Attorney Daniel G. Bogden of the District of Nevada and Leslie R. Caldwell, Assistant Attorney General of the Justice Department’s Criminal Division.

            “We will use federal resources to prosecute street gang members who commit cowardly and horrible crimes in our community,” said U.S. Attorney Bogden.  “I commend the many law enforcement officers who worked on this investigation and assisted us in ensuring a conviction in this case.”

Markette Tillman, 31, pleaded guilty to one count of RICO conspiracy and one count of possession with intent to distribute cocaine base, and is scheduled to be sentenced by U.S. District Judge Kent J. Dawson on Oct. 28, 2014.  Tillman faces up to 20 years in prison on each count, as well as fines of up to $1 million.  The jury trial began yesterday, July 28, 2014, and the government had called seven witnesses to testify.  Tillman is the remaining gang member to be convicted out of 10 charged in a RICO indictment filed in 2008. 

According to the guilty plea agreement and evidence produced at trial, the Bloods are a nationally-known criminal street gang whose members engage in drug trafficking and acts of violence.  The Playboy Bloods is a local “set” or affiliate of the Bloods, with local control and operation within the Las Vegas metropolitan area.  The Playboy Bloods operate primarily in the Sherman Gardens Annex, a public housing complex, located at the corner of Doolittle and H Streets in Las Vegas, and commonly called the “Jets.”  On or about Jan. 20, 2004, Tillman aided and abetted the murder of a security guard at the Jets.  The guard approached Tillman and several other Playboy Bloods and told them to leave the property.  An argument ensued, and the guard rode away on his bicycle to get help.  One of the Playboy Bloods fired a gun at the guard, hitting him two times and killing him.  Tillman admitted that he aided and abetted the murder of the guard and acted deliberately and intentionally with extreme disregard for human life.  Tillman further admitted that he agreed with other members of the Playboy Bloods to manufacture and distribute narcotics, primarily crack cocaine, and to operate drug houses within the Playboy Bloods’ turf.  Tillman specifically admitted to distributing in excess of 280 grams of crack cocaine.  Tillman also admitted that he distributed crack cocaine to another person on about Jan. 3, 2007, at one of the drug houses.

            Nine other defendants who have been convicted and sentenced, as follows:

• Jacorey Taylor, aka “Mo-B,” 31, convicted by a jury of engaging in a racketeering conspiracy, committing violent crimes in aid of racketeering activity, using a firearm during a crime of violence, participating in a drug conspiracy, and possessing crack cocaine with the intent to distribute and sentenced to life in prison Oct. 21, 12013.

• Steven Booth, aka “Stevie-P,” 27, pleaded guilty to RICO conspiracy involving two murders and was sentenced to 20 years in prison on April 10, 2013

• Reginald Dunlap, aka “Bowlie,” 30, pleaded guilty to RICO conspiracy involving one murder and was sentenced to 20 years in prison on April 9, 2013

• Demichael Burks, aka “Mikey P,” 29, pleaded guilty to RICO conspiracy and was sentenced to 6½ years in prison on Dec. 3, 2010 

• Anthony Mabry, aka “Akim Slim,” 43, pleaded guilty to RICO conspiracy and was sentenced to 14 years in prison on Oct. 20, 2010

• Delvin Ward, aka “D-Luv,” 37, pleaded guilty to RICO conspiracy and was sentenced to 11 years in prison on Sept. 17, 2010

• Terrence Thomas, aka “Seven,” 40, pleaded guilty to drug conspiracy and was sentenced to 10 years in prison on June 16, 2010

• Sebastian Wigg, aka “Rock,” 36, pleaded guilty to drug conspiracy and was sentenced to five years in prison on March 29, 2010

• Fred Nix, aka “June P,” 36, pleaded guilty to drug conspiracy and was sentenced to five years in prison on March 29, 2010 

            The cases were investigated by the FBI’s Las Vegas Safe Streets Gang Task Force, which includes officers from the North Las Vegas Police Department and Las Vegas Metropolitan Police Department, and are being prosecuted by Assistant United States Attorneys Nicholas D. Dickinson and Phillip N. Smith, Jr., and Kevin L. Rosenberg, Trial Attorney with the U.S. Department of Justice Organized Crime and Gang Section.

          LAS VEGAS, Nev. – A Las Vegas man well-known to local police because of his lengthy criminal history and street gang affiliations, was sentenced today to 155 months in federal prison and five years of supervised release, announced Daniel G. Bogden, United States Attorney for the District of Nevada. 

Ryan Walton, aka Ryan McLemore, 32, of Las Vegas, was sentenced by U.S. District Judge Andrew P. Gordon.  Walton pleaded guilty on April 23, 2014, to three counts of possession of a firearm by a convicted felon, two counts of possession of cocaine with intent to distribute, and one count of use or possession of a firearm in relation to a drug trafficking offense.  Walton, who has been connected to the Las Vegas street gang known as the Gerson Park Kingsmen, has had four drug convictions, four firearm-related convictions, and three violent crime convictions in Clark County, Nev. since 2001.

            “This case is an excellent example of how we are working together with our federal and local law enforcement partners and the District Attorney’s Office to identify dangerous and recidivist felons,” said U.S. Attorney Bogden.  “Despite numerous, previous felony convictions, the defendant continued to endanger the community by possessing firearms in connection with violence and drug dealing.  Thanks to our Project Safe Neighborhoods program partnerships and the Safe Streets Task Force, this defendant will no longer be a threat to our community.”   

            According to the defendant’s guilty plea agreement, three of the counts of conviction resulted from an incident on Sept. 26, 2007, when Las Vegas Metropolitan Police Department (LVMPD) detectives executed a search warrant at his residence and found cocaine, drug paraphernalia, and a rifle.  Two more counts of conviction resulted from incidents on Dec. 22 and Dec. 27, 2010, in which LVMPD detectives and Nevada Division of Parole and Probation Officers executed a search of the vehicle Walton drove, and found two semi-automatic handguns and several loaded extended ammunition magazines, body armor, cocaine, marijuana, and drug distribution paraphernalia.   The last count of conviction resulted from an incident on Aug. 8, 2012, when North Las Vegas Police Department Officers made contact with Walton as he was driving with a suspended license, and found two semi-automatic handguns in the vehicle, both of which had been reported as stolen.

This case was investigated by the FBI, the Las Vegas Metropolitan Police Department and the North Las Vegas Police Department, as part of the Safe Streets Task Force and Project Safe Neighborhoods program.  The case was prosecuted by Assistant U.S. Attorney Cristina D. Silva.

WASHINGTON – Nathan Stoliar, 64, of Australia, pleaded guilty in federal court in Las Vegas today to five felonies for his role in multiple schemes, worth in excess of $41 million, to generate fraudulent biodiesel credits and to export biodiesel without providing biodiesel credits to the United States as required by law. 

Stoliar and another defendant had been charged in January 2014 in a 57-count indictment alleging conspiracy, wire fraud, false statements under the Clean Air Act, obstruction of justice and conspiracy to engage in money laundering.  Following his indictment, Stoliar’s arrest was sought by the United States.  Located in Poland, Stoliar returned in early February to the United States to surrender for arrest.  Stoliar pleaded guilty Tuesday to one count of conspiracy, one count of conspiracy to engage in money laundering, two counts of wire fraud and one count of making false statements under the Clean Air Act.  Stoliar is required by the plea to forfeit $4 million and pay $1 million in restitution.  He faces a maximum sentence of 20 years in prison and a $500,000 fine for each count of conspiracy to engage in money laundering and wire fraud, five years in prison and a $250,000 fine for conspiracy, and two years in prison and a $250,000 fine for making false statements under the Clean Air Act.

“Stoliar and his co-conspirator perpetrated a massive fraud against a renewable fuels program created to protect our nation’s energy security and independence,” said Sam Hirsch, Acting Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division.  “The Justice Department will continue to pursue fraudsters at home and abroad and protect the integrity of federal programs as it protects the environment.”

“By rooting out fraud, EPA is committed to achieving the environmental goals that Congress envisioned when it created the Renewable Fuel Standard,” said Cynthia Giles, the U.S. Environmental Protection Agency’s (EPA) Assistant Administrator for Enforcement and Compliance Assurance.  “This case, like other recent ones, supports legitimate businesses and makes clear to potential violators that EPA and its partners will fight to protect the program’s integrity.”

“With this guilty plea, the defendant admitted that he participated in a conspiracy to defraud the United States government, specifically the EPA, and that he personally gained more than $7 million from the scheme,” said Dan Bogden, U.S. Attorney for the District of Nevada.  “These types of schemes are complex and require an enormous expenditure of resources to investigate and prosecute.  Because of the tremendous work of the investigators and prosecutors on this case, we were also able to seize and forfeit from the defendant millions of dollars from bank accounts, as well as real property in Nevada and California, jewelry and other assets.”

The Energy Independence and Security Act of 2007 created a number of federally-funded programs that provided monetary incentives for the production and use of renewable fuels such as biodiesel in the United States.  Biodiesel producers and importers can generate and attach credits known as “renewable identification numbers,” or RINs. to the gallons of biodiesel they produce or import.  Because certain companies (such as companies that sell transportation fuel in the United States) need RINs to comply with regulatory obligations, RINs have significant market value.  They are routinely bought and sold in the marketplace.  In addition, to ensure that RINs are generated for renewable fuel used only in the United States, and in order to create an incentive for biodiesel in the United States to be used here, anyone who exports biodiesel is required to obtain these valuable RINs for all exported gallons and provide the RINs to EPA.   

Stoliar admitted that beginning around September of 2009, he and co-defendant James Jariv operated and controlled a company -- City Farm Biofuel in Vancouver, British Columbia, Canada -- that represented itself as a producer of biodiesel from “feedstocks” such as animal fat and vegetable oils.  Stoliar and Jariv also formed a company called Canada Feedstock Supply – that represented itself as City Farm’s supplier of feedstocks necessary to produce biodiesel.  Jariv operated and controlled a company based in Las Vegas called Global E Marketing (GEM).  Using these three and other closely-held companies, Stoliar and his codefendants claimed to produce biodiesel at the City Farm facility and to import and sell biodiesel to GEM, and then generated and sold RINs based upon this claimed production, sale and importation.  In reality, no biodiesel produced at City Farm was ever imported and sold to GEM as claimed.  Stoliar and his codefendants used GEM to claim to blend the biodiesel with petroleum diesel, allowing them to sell the RINs separately from any actual biodiesel.  Using this scheme, Stoliar and his co-defendants falsely claimed to import, purchase and blend more than 4.2 million gallons of biodiesel.  They then sold the RINs, and fraudulently generated more than $7 million. 

The indictment also alleges that, beginning around the same time period and continuing through Dec. 31, 2013, Stoliar and Jariv, using their company MJ Biodfuel, bought over 23 million gallons of RIN-less biodiesel that had been blended with small amounts of petroleum diesel to form B-99.  The defendants bought the B-99 from unrelated companies in the United States, and this B-99 had been used by other companies to generate and separate RINs from the fuel.  Because B-99 cannot be used to again generate a RIN, and because it cannot be used for other tax-related incentives, B-99 sells for substantially less than 100 percent biodiesel (known as B-100).  Stoliar sold some of this biodiesel to purchasers in the United States, claiming it was B-100 produced at the City Farm facility and imported into the United States.  By claiming this biodiesel was B-100 and not RIN-less B-99, Stoliar marketed the fuel as eligible to be used by purchasers to generate credits and incentives, and Stoliar was able to sell the fuel for as much as $2.30 per gallon more than he otherwise would have been able.

Stoliar and his co-defendants also exported significant amounts of the RIN-less B-99 they bought in the United States to Canada.  Stoliar then sold the biodiesel in Canada, and conspired with his co-defendants to not acquire and provide RINs to the United States for these exports as they were required to do by law.  In doing so, Stoliar and Jariv failed to give to the United States RINs worth in excess of $34 million, keeping this money for themselves instead.

Finally, Stoliar and Jariv conspired to launder the proceeds of their crimes, utilizing foreign banking institutions and complex financial transactions to promote their illegal schemes and distribute the proceeds of their crimes.  Accounts were utilized in Canada, Nevada and Australia, and transactions between the defendants’ closely-held companies were described as other legitimate transactions involving biodiesel, when in reality they were not.

Sentencing for Stoliar has been set for is Oct. 30, 2014 in Las Vegas, Nevada.  The investigation that led to today’s plea was the result of collaborative work by the EPA’s Criminal Investigation Division and the FBI, with assistance from the United States Secret Service, the Internal Revenue Service-Criminal Investigations and the Department of Homeland Security. 

The case is being prosecuted by Assistant Chief Wayne D. Hettenbach of the Environmental Crimes Section of the Justice Department’s Environment and Natural Resources Division, Assistant U.S. Attorney’s Crane M. Pomerantz and Daniel D. Hollingsworth of the U.S. Attorney’s Office in Nevada, and Assistant Deputy Chief Darrin L. McCullough of the Justice Department’s Criminal Division, Asset Forfeiture and Money Laundering Section, with the assistance of the Justice Department’s Office of International Affairs and the United States Attorney’s Office for the Southern District of Texas.

          LAS VEGAS, Nev. – The owner of several liquor stores on the Las Vegas Strip has pleaded guilty to conspiring to defraud the IRS for failing to report income that was skimmed from the businesses, announced Daniel G. Bogden, United States Attorney for the District of Nevada.

Ramzi Suliman pleaded guilty on July 14, 2014, to one count of conspiracy to defraud the United States.  Suliman faces up to five years in prison and up to a $250,000 fine, and is scheduled to be sentenced by U.S. District Judge Lloyd D. George on Jan. 12, 2015.

Suliman and co-defendant Jeffrey Nowak were originally charged in a criminal indictment dated April 10, 2013, with one count of conspiracy to defraud the United States, three counts of assisting in filing false corporate tax returns, and four counts of attempting to evade and defeat tax.  Nowak’s case is pending, and he is currently scheduled for trial beginning Dec. 3, 2014.

According to Suliman’s guilty plea memorandum, from about 2006 to present, Suliman and Nowak owned and operated three liquor stores in Las Vegas, Super Liquor South Strip at 3999 S. Las Vegas Boulevard, Super Liquor Mid Strip at 2301 S. Las Vegas Boulevard, and Super Liquor McCarran Village at 384 E. Tropicana Avenue. Suliman stated in his plea agreement that he and Nowak diverted cash receipts from the stores to their own use by presenting false books and records to the corporate accountant for use in preparing corporate and individual tax returns for the businesses and the defendants. 

From about 2006 to 2009, Suliman admitted that he and Nowak maintained multiple sets of accounting records for their liquor stores, and that they skimmed some of the cash received from one of the stores and agreed not to report it the IRS. Suliman reported that they omitted the skimmed cash from the accounting records that were provided to the accountant for the preparation of their tax returns.  Suliman admitted that he was aware of and consented to the skim and occasionally made entries in the records.  Suliman admitted that his participation in the conspiracy to defraud the IRS resulted in a tax loss to the government of $200,000 to $400,000 for the years 2006 to 2009.

The case is being investigated by IRS Criminal Investigation and is being prosecuted by Assistant U.S. Attorney Kathryn C. Newman.

          LAS VEGAS, Nev. – A Las Vegas attorney was sentenced to 366 days in prison today for assisting a client launder approximately $2.25 million that had been obtained fraudulently in an online investment scheme, announced the United States Attorney’s Office for the District of Nevada.

            R. Christopher Reade, 43, of North Las Vegas, was sentenced by U.S. District Judge Kent J. Dawson, who allowed Reade to self-report to federal prison by Oct. 17, 2014.  Reade pleaded guilty in January to one count of accessory after the fact to laundering of monetary instruments.  

“Reade’s conduct was not a “one-off” act spawned by the unfortunate coupling of naïveté and necessity,” said First Assistant U.S. Attorney Steven W. Myhre. “It was a knowing, calculated, and sophisticated course and pattern of conduct motivated by greed and engaged in over time.  Reade knew that his conduct was wrong and that it ran contrary to his professional obligations as an attorney and would hurt others.”

            Reade was a licensed attorney in Las Vegas and practiced business law.  His client, Rick Young, owned and operated a Nevada corporation known as Global One Group, LLC, a web-based company which purported to train others how to trade in the foreign currency exchange market, or FOREX.  Young advertised that he was an experienced and highly successful trader in the FOREX market, who for a fee would teach persons his winning trading strategies and techniques. Young solicited persons to become members of Global One which would allow them access to his web-based live training seminars.  Young claimed that he had developed an automated trading program that traded according to his strategies simply by “flipping a switch.” Young enticed members into providing money for “loans” to Global One and told them that they would be able to earn high yield returns on their investments.  In actuality, the automated trading program did not exist in the form that Young represented and Young was running an elaborate Ponzi scheme in which proceeds from the member loans were diverted to Young his own use.  From about 2006 to 2008, Young derived approximately $16 million in proceeds from the scheme.

Beginning in February 2007, Reade represented Young and Global One in connection with business litigation and transactions.  In March 2007, Young intended to use Global One loan monies to purchase a FOREX brokerage company named Trend.  To disguise the source and ownership of the illegal proceeds, Young authorized Reade to create and control a holding corporation called Way FX Corp. In April 2007, Young transferred approximately $2.25 million from Global One accounts to the Way FX bank account controlled by Reade, and Reade signed an agreement to purchase Trend.  On August 21, 2007, Reade received $75,000 from Global One for his services related to Way FX and the purchase of Trend.

From about May 2007 to August 2007, in connection with an investigation by the National Futures Association about the ownership and funding of Trend, Reade falsely told investigators that he was unaware who owned Global One or how Global One raised money, and that the funds used to purchase Trend came from his personal contributions and not from Global One.  Reade knew that his statements were false and that Young had committed the offense of money laundering.  Reade also knew that he had assisted Young in order to hinder or prevent the investigation of Young in connection with the money laundering.

            In March 2011, Young was convicted by a federal jury in the District of Nevada of conspiracy, fraud and money laundering charges. In December 2011, he was sentenced to 25 years in prison and ordered to pay $13.3 million in restitution. 

            The case was investigated by the FBI and IRS Criminal Investigation, and prosecuted by First Assistant United States Attorney Steven W. Myhre and Assistant United States Attorney James E. Keller.

Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes.  With more than 20 federal agencies, 94 U.S. attorney’s offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud.  Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations.  Since the inception of FFETF in November 2009, the Justice Department has filed more than 12,841 financial fraud cases against nearly 18,737 defendants including nearly 3,500 mortgage fraud defendants.  For more information on the task force, visit www.stopfraud.gov.

          LAS VEGAS, Nev. – A former Las Vegas resident who made over $3 million from selling unregistered penny stock in a purported diamond mine company known as CMKM, has been sentenced to four years in prison, announced Daniel G. Bogden, United States Attorney for the District of Nevada. 

            Marco Glisson, 59, formerly of Las Vegas, but most recently of Miami, Fla., was sentenced on July 10, 2014, by U.S. District Judge Larry R. Hicks. Glisson pleaded guilty on Jan. 15, 2014, to conspiracy to offer and sell unregistered securities and tax evasion.   Judge Hicks denied Glisson’s request for a self-surrender to prison, and ordered him into federal custody at the end of the sentencing hearing.  

According to Glisson’s plea agreement, Glisson, who was not a registered broker or dealer of securities, conspired with others to purchase and sell CMKM, Inc. penny stock after the U.S. Securities and Exchange Commission (SEC) permanently revoked CMKM’s trading privileges.  Beginning in about December 2005, Glisson, and his conspirators used a transfer agent/company known as Global Stock Transfer LLC to cancel CMKM’s stock certificates that were held in the names of other co-conspirators and reissue them to Glisson.  Glisson marketed the stock in internet chat rooms under the name “Deli dog” or Deli,” and also used the mail and other resources to offer and sell it. As Glisson sold the shares of CMKM stock, the stock transfer company would cancel them and reissue them to the purchasers.  From December 2005 to May 2006, Glisson sold billions of shares of CMKM stock to at least 65 different persons in the United States and Canada.  In June 2006, the SEC contacted Glisson and told him that it was illegal to publicly offer and sell unregistered securities.  Glisson stopped selling the CMKM stock for a few months, but in September 2006, he resumed offering and selling the CMKM stock and continued selling it until April 2007.  Glisson’s sales of billions of unregistered shares of CMKM stock from 2006 to 2007 yielded him more than $1.7 million.  

Glisson failed to pay the federal income taxes he owed for 2006 and 2007, and instead took affirmative acts to hide the income, such as placing money in bank accounts under the name of his wife and others and using cash. As a result, Glisson owes over $400,000 in back taxes to the IRS for 2006 and 2007.

Ten co-conspirators were also charged in a separate case pending in the District Court for the District of Nevada.  Five are pending trial, one pleaded guilty and is awaiting sentencing, one is a fugitive, one is awaiting extradition, one is deceased, and the charges against another were dismissed. 

The case is being investigated by the FBI and IRS Criminal Investigation, and prosecuted by Assistant U.S. Attorneys Kathryn Newman and Andrew Duncan.  

            Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes.  With more than 20 federal agencies, 94 U.S. attorney’s offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud.  Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations.  Since the inception of FFETF in November 2009, the Justice Department has filed more than 12,841 financial fraud cases against nearly 18,737 defendants including nearly 3,500 mortgage fraud defendants.  For more information on the task force, visit www.stopfraud.gov.