Eastern District of New York

A three-count indictment was unsealed today in United States District Court for the Eastern District of New York charging Mohammad Ibrahim Bazzi, a Lebanese and Belgian citizen, and Talal Chahine, a Lebanese citizen, with conspiracy to conduct and cause United States persons to conduct unlawful transactions with a Specially Designated Global Terrorist, attempt to conduct and cause United States persons to conduct unlawful transactions with a Specially Designated Global Terrorist, and money laundering conspiracy.  The indictment was returned under seal by a federal grand jury sitting in Brooklyn, New York on January 27, 2023, and relates to Bazzi and Chahine’s alleged activities in the United States, as directed from Lebanon.

Breon Peace, United States Attorney for the Eastern District of New York and Daniel J. Kafafian, Acting Special Agent-in-Charge, Drug Enforcement Administration (DEA), New Jersey Division (DEA), announced the charges.

“As alleged, Mohammad Bazzi thought that he could secretly move hundreds of thousands of dollars from the United States to Lebanon without detection by law enforcement.  Today’s arrest proves that Bazzi was wrong,” stated United States Attorney Peace.  “Our office is committed to ensuring that sanctions imposed by the U.S. government are respected and that terrorism financiers are starved of funds.”

“The defendants in this case attempted to provide continued financial assistance to Hizballah, a foreign terrorist organization responsible for death and destruction,” stated DEA Acting Special Agent-in-Charge Kafafian. “The men and women of DEA are committed to working with our law enforcement and foreign counterparts to disrupt and dismantle the operations of these organizations and those who choose to support them financially.”

In May 2018, the United States Department of the Treasury, Office of Foreign Assets Control (OFAC) designated Bazzi as a Specially Designated Global Terrorist for assisting in, sponsoring, and providing financial, material, and technological support and financial services to Hizballah, a foreign terrorist organization that, since the 1980s, engaged in numerous terrorist activities, including attacks against American military members, government employees, and civilians abroad.  According to the OFAC designation, Bazzi is a key Hizballah financier who has provided millions of dollars to Hizballah over the years, generated from his business activities in Belgium, Lebanon, Iraq and throughout West Africa.  As a result of the designation, Bazzi’s interest in any property in the United States was blocked, and all U.S. persons were generally prohibited from transacting business with, or for the benefit of, Bazzi.

As alleged, following Bazzi’s designation, Bazzi and Chahine conspired to force or induce an individual located in the United States (U.S. Person) to liquidate their interests in certain real estate assets located in Michigan and covertly transfer hundreds of thousands of dollars in proceeds of the liquidation out of the United States to Bazzi and Chahine in Lebanon without the requisite OFAC licenses, in violation of the International Emergency Economic Powers Act (IEEPA). 

During recorded communications, Bazzi and Chahine proposed numerous methods to conceal from OFAC and law enforcement officials that Bazzi was both the source and destination of the proceeds of the sale and to create the false appearance that the U.S. Person was conducting legitimate arms-length transactions unrelated to Bazzi and Chahine.  For example, Bazzi and Chahine proposed that the funds be transferred through:

• a third party in China as part of a fictitious purchase of restaurant equipment from a Chinese manufacturer;
• a third party in Lebanon as part of a fictitious real estate purchase;
• Chahine’s family members in Kuwait as part of fictitious intra-family loans; and
• as part of a fictitious franchising agreement as payment for the rights to operate a Lebanese-based restaurant chain throughout the United States.

Bazzi was arrested by Romanian law enforcement authorities upon his arrival in Bucharest today.  The United States intends to seek Bazzi’s extradition to the Eastern District of New York to face the charges in the indictment.  Each count in the indictment is punishable by up to 20 years imprisonment.  The charges in the indictment are merely allegations, and the defendants are presumed innocent unless and until proven guilty.

This effort is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF

The government’s case is being prosecuted by Assistant United States Attorneys Francisco J. Navarro, Jonathan P. Lax, Nomi D. Berenson, and Robert M. Pollack, with assistance provided by Trial Attorney Charles Kovats of the National Security Division’s Counterterrorism Section.  Assistant United States Attorney Claire Kedeshian of the Office’s Asset Recovery Section is handling forfeiture matters.  The Justice Department’s Office of International Affairs is assisting with the extradition in this case.

The Defendants:

MOHAMMAD BAZZI
Age: 58
Lebanon and Belgium

TALAL CHAHINE
Age: 78
Lebanon

E.D.N.Y. Docket No. 23-CR-041 (DLI)

A five-count indictment was unsealed today in federal court in Brooklyn, New York charging Ilya Balakaev with various charges related to smuggling devices commonly used in counterintelligence operations out of the U.S. to Russia for the benefit of the Federal Security Service of the Russian Federation (FSB) and Democratic People’s Republic of Korea (“DPRK” or “North Korea”).    

As alleged, between 2017 and the present, the defendant Ilya Balakaev entered into multiple contracts through his company Radiotester LLC with the FSB—the principal intelligence and security agency of the Russian government—to repair spectrum analyzers and signal generators.  The devices that the defendant was tasked to repair were frequently used as part of counterintelligence operations to sweep for surveillance bugs and to transmit covert communications.  Because the devices were not readily available in Russia, the defendant created a network of individuals in the U.S. to assist him in purchasing the equipment in the U.S. which he used to repair the FSB devices, in violation of U.S. sanctions.   

The defendant worked closely with Russian government officials from FSB Center 8’s Military Unit 43753, the agency responsible for Russia’s communication security and cryptology.  In furtherance of his scheme, the defendant entered into at least 10 contracts with FSB Military Unit 43753, purchased approximately 43 devices in the U.S., and traveled to the U.S. approximately 14 times in the span of approximately four years. 

In addition to his scheme to evade Russian sanctions, the defendant also provided U.S. technology to a North Korean government official, in violation of U.S. sanctions against North Korea.  The defendant contracted with the First Secretary of the North Korean Embassy to the Russian Federation, based in Moscow, to obtain hazardous gas detectors and software from the U.S. for the benefit of the North Korean government. 

Breon Peace, United States Attorney for the Eastern District of New York, Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), Special Agent in Charge Jonathan Carson., US Department of Commerce, Bureau of Industry and Security, Office of Export Enforcement, New York Field Office, Ivan Arvelo, Special Agent-in-Charge, Homeland Security Investigations, New York (HSI), Francis J. Russo, Director of Field Operations, U.S. Customs and Border Protection, New York Field Office (CBP) and Andrew Adams, Director, Task Force KleptoCapture, announced the charges.

“As alleged, the defendant violated U.S. law by procuring, smuggling, and repairing counterintelligence operation devices for the benefit of Russia’s secret police and the North Korean government,” stated United States Attorney Peace. “Today’s indictment demonstrates our Office’s commitment to vigorously prosecute those who evade sanctions for a profit, both for their wallet and for Russia as they continue their aggression against Ukraine.”

“The defendant allegedly operated schemes to smuggle software and devices from the United States and provide them to hostile foreign government services in violation of U.S. sanctions.  FBI New York and our partners will continue to protect the national security of the United States by disrupting the procurement of sanctioned equipment and technology,” stated Assistant Director-in-Charge Driscoll.  

“To prevent the continuance of violations identified in the indictment, the defendant is now subject to a Commerce temporary denial order, which restricts his ability to access U.S. technologies,” said Jonathan Carson, Special Agent-in-Charge of the New York Field Office, Office of Export Enforcement.  “These coordinated actions highlight our vigilance and ability to leverage our unique combination of criminal and administrative enforcement authorities to address evasions of U.S. export controls.”

“U.S. Customs and Border Protection is uniquely positioned to enhance the safety of our country. We will continue to work with our partners to be exceptionally focused on addressing the threats posed by counterintelligence activities, terrorism, transnational criminal organizations, and others who wish to do us harm,” said Francis J. Russo, Director New York Field Office.  “CBP’s combined efforts with our law enforcement partners in this case serve as a reminder that we will continue to combat and prosecute modern transnational criminal organizations.”

“From the outset of the Task Force, the Department has prioritized the investigation and prosecution of case involving criminal violations of our export controls pertaining to Russia. As today’s case demonstrates, facilitators like this defendant provide smuggling services for all manner of dangerous actors and regimes – it is not possible to disentangle the FSB’s smuggling networks from those servicing other sanctioned state actors, and we must support and applaud comprehensive charges like those set forth in the Eastern District’s indictment,” stated Task Force KleptoCapture Director Adams.

“As alleged, Balakaev and his network actively schemed to circumvent OFAC sanctions in support of enhancing the counterintelligence operations of the Federal Security Service of the Russian Federation (FSB) and the Democratic People’s Republic of Korea. Today’s indictment, on the one year anniversary of the Russian invasion of Ukraine, is a credit to the collaboration of the American law enforcement community to investigate and prosecute those who seek to support oppressive regimes worldwide,” said Ivan J. Arvelo, Special Agent in Charge for Homeland Security Investigations (HSI) in New York.  “HSI and our partners will continue to aggressively pursue criminal charges against those who engage in actions aimed at compromising our national security.”

If convicted, the defendant faces a maximum of 75 years’ imprisonment.  The charges in the indictment are allegations, and the defendants are presumed innocent unless and until proven guilty.

The government’s case is being handled by the Office’s National Security and Cybercrime Section.  Assistant United States Attorney Sara K. Winik is in charge of the prosecution, with assistance from Trial Attorney Scott A. Claffee of the National Security Division’s Counterintelligence and Export Control Section.

The Defendant:

ILYA BALAKAEV
AGE: 47
MOSCOW, RUSSIA

E.D.N.Y. Docket No. 23-CR-79

Earlier today, in federal court in Central Islip, a four-count indictment was unsealed charging 13 of the highest-ranking MS-13 leaders in the world with directing the transnational criminal organization’s criminal activities in the United States, El Salvador, Mexico, and elsewhere, over the past two decades.  Specifically, the defendants are charged with racketeering conspiracy, conspiracy to provide or conceal material support to terrorists, and narco-terrorism conspiracy.  Four of the defendants are also charged with alien smuggling conspiracy which resulted in death.

On February 22, 2023, Vladimir Antonio Arevalo-Chavez, also known as “Vampiro de Monserrat Criminales” (Arevalo-Chavez), Walter Yovani Hernandez-Rivera, also known as “Baxter de Park View” and “Bastard de Park View” (Hernandez-Rivera), and Marlon Antonio Menjivar-Portillo, also known as “Rojo de Park View” (Menjivar-Portillo), were located by Mexican authorities and expelled from Mexico via the United States.  When Arevalo-Chavez, Hernandez-Rivera, and Menjivar-Portillo arrived at George Bush Intercontinental Airport in Houston, Texas, they were placed under arrest by the Federal Bureau of Investigation (FBI) and Immigration and Customs Enforcement’s Homeland Security Investigations (HSI).  Earlier this afternoon, the defendants had initial appearances in the Southern District of Texas, pending removal to the Eastern District of New York.

Four co-defendants, Jose Wilfredo Ayala-Alcantara, also known as “Indio de Hollywood,” Jorge Alexander De La Cruz, also known as “Cruger de Peatonales,” Juan Antonio Martinez-Abrego, also known as “Mary Jane de Hollywood,” and Francisco Javier Roman-Bardales, also known as “Veterano de Tribus,” remain at large.  Members of the public with information concerning their whereabouts are strongly encouraged to contact the FBI’s toll-free MS-13 tip line, 1-866-STP-MS13 (1-866-787-6713), or HSI’s tip line at (866) 347-2423 or https://www.ice.gov/webform/ice-tip-form.  Together, FBI and HSI have offered a $20,000 reward for information leading to the arrest and conviction of the four fugitives. 

Six other co-defendants, Edwin Ernesto Cedillos-Rodriguez, also known as “Renuente de Abriles Dangers,” Carlos Tiberio Ramirez-Valladares, also known as “Snayder de Pasadena,” Dany Fredy Ramos-Mejia, also known as “Cisco de Teclas,” Dany Balmore Romero-Garcia, also known as  “Big Boy de Normandies,” “Dig Boy de Normandies,” and “D Boy de Normandies,” Ruben Antonio Rosa-Lovo, also known as “Chivo de Centrales,” and Miguel Angel Serrano-Medina, also known as “Cabro de Park View,” are believed to be in custody in El Salvador.  The United States will explore options for their extradition with the government of El Salvador.

Merrick B. Garland, United States Attorney General; Breon Peace, United States Attorney for the Eastern District of New York (EDNY); Christopher A. Wray, Director, FBI; Deputy Director and Senior Official Performing the Duties of the Director Tae D. Johnson, Homeland Security Investigations; and John J. Durham, Director of Joint Task Force Vulcan (JTFV), announced the indictment and arrests.

“Today’s action makes clear that there is no hiding place, anywhere in the world, for the leaders of violent gangs that terrorize American communities,” said Attorney General Merrick B. Garland. “The Justice Department will continue to use the full force of our law enforcement authorities to disrupt and dismantle MS-13 and other transnational criminal organizations and hold their leaders accountable.”

“The relentless efforts of our Office and law enforcement partners are systematically dismantling the MS-13 from the bottom to the very top, and we will not stop until this transnational criminal organization and its leaders are held accountable for the extreme violence they have inflicted on our district, the United States, and the countries where this scourge is based,” stated United States Attorney Peace. “Geographic borders will not shield violent actors from American justice.”

“Today’s indictment demonstrates the Department of Justice’s ongoing commitment to hold MS-13’s highest ranking leaders responsible for the terrorism and violence that they have unleased on communities from Long Island to El Salvador and elsewhere,” said JTFV Director Durham.  “Only by combating MS-13’s command and control structure, and bringing the transnational criminal organization’s highest-ranking leaders to justice in the United States will we be able to break the persistent cycles of violence that have plagued our communities.”

“The FBI will continue to vigorously investigate and hold transnational organized groups like MS-13 and their leaders accountable for the continued violent and terrorist criminal activities they orchestrate,” said FBI Director Christopher Wray. “Today’s indictment demonstrates the FBI’s reach and commitment to seeking justice against those individuals who jeopardize American lives and liberty. We will never stop working in coordination with our international partners to protect our respective citizens from MS-13 and other gangs wherever they are.”

"As a member of Joint Task Force Vulcan, U.S. Immigration and Customs Enforcements’ Homeland Security Investigations is committed to protecting national security and the communities we serve against transnational criminal organizations,” said Deputy Director and Senior Official Performing the Duties of the Director Tae D. Johnson of U.S. Immigration and Customs Enforcement. “With our broad legal authorities and ability to investigate a wide spectrum of crimes, our HSI special agents will continue to maximize global efforts that detect, deter, disrupt, and dismantle criminal syndicates, like MS-13, and those who propagate associated illicit operations."

As set forth in court filings, the 13 defendants are part of MS-13’s command and control structure, consisting of the Ranfla Nacional, Ranfla en Las Calles, and Ranfla en Los Penales, and play significant leadership roles in the organization’s operations in El Salvador, Mexico, the United States and throughout the world.  In the related case of United States v. Henriquez, et al., a grand jury in the Eastern District of New York previously indicted 14 members of the Ranfla Nacional, who functioned as MS-13’s “Board of Directors.”   Formal extradition packages were submitted by the United States for 12 of those defendants, who either are or were in El Salvador custody, and remain pending.  The two other defendants, Fredy Ivan Jandres-Parad, also known as “Lucky de Park View” and “Lacky de Park View,” and Cesar Humberto Lopez-Larios, also known as “El Grenas de Stoners” and “Oso de Stoners,” still are fugitives.

As further alleged, the defendants have engaged in a litany of violent terrorist activities aimed at influencing the government of El Salvador (GOES).  The defendants have used terrorist violence to obtain benefits and concessions from the GOES and to target GOES law enforcement and military officials.  They have also used improvised explosive devices and grenades and operated military-style training camps for firearms and explosives.  The defendants have actively engaged in public displays of violence to threaten and intimidate civilian populations, to obtain and control territory and to manipulate the electoral process in El Salvador.  Several of these defendants have played prominent roles in MS-13’s past and current negotiations with the GOES.

Further, these defendants authorized and directed violence in the United States, Mexico, and elsewhere as part of a concerted effort to expand MS-13’s influence and territorial control.  As the leaders of the MS-13 transnational criminal organization, these defendants were an integral part of the leadership chain responsible for supervising MS-13 cliques in the United States that engaged in extreme violence, including numerous murders, attempted murders, assaults, and related offenses.  For example, this Office’s Long Island Criminal Division has prosecuted hundreds of MS-13 leaders, members, and associates for carrying out more than 65 murders in the Eastern District of New York between 2009 and the present. 

Several of these defendants, including Arevalo-Chavez, Hernandez-Rivera, and Menjivar-Portillo, coordinated MS-13’s expansion into Mexico (the Mexico Program), at the direction of the Ranfla Nacional, which was a coordinated effort to maintain MS-13’s continuity of operations in response to law enforcement pressure previously exerted by the United States and GOES.  Additionally, the Mexico Program included forging alliances with Mexican cartels and engaged in narcotics trafficking, immigrant smuggling and extortion, kidnappings, and weapons trafficking.  As alleged in the indictment, the MS-13’s Mexico Program murdered some migrants bound for the United States, including suspected members of the rival 18th Street gang and MS-13 members attempting to flee MS-13 in El Salvador without permission.  Finally, drug trafficking was an important part of MS-13’s money-making operation, especially in Mexico, and the defendants used MS-13’s large membership in the United States to generate financial support for MS-13’s terrorist activities in El Salvador.

Since its creation in August 2019, JTFV has successfully implemented a whole-of-government approach to combatting MS-13, including increasing coordination and collaboration with foreign law enforcement partners, including El Salvador, Mexico, Honduras, and Guatemala. JTFV has also identified and targeted for prosecution the MS-13 programs, cliques and individuals that have had the most violent impact in the United States and it has coordinated significant MS-13 indictments in U.S. Attorney’s Offices across the country, including the first use of national security charges against MS-13 leaders.

JTFV has been comprised of members from U.S. Attorney’s Offices across the country, including the EDNY; the District of New Jersey; the Northern District of Ohio; the District of Utah; the District of Massachusetts; the Eastern District of Texas; the Southern District of New York; the Eastern District of Virginia; the Southern District of Florida; the Southern District of California; the District of Nevada; the District of Alaska; and the District of Columbia, as well as the Department of Justice’s National Security Division and the Criminal Division.  In addition, all Department of Justice law enforcement agencies are involved in the effort, including the FBI; the U.S. Drug Enforcement Administration; the Bureau of Alcohol, Tobacco, Firearms and Explosives; the U.S. Marshals Service; and the U.S. Bureau of Prisons.  In addition, HSI also plays a critical role in JTFV.

U.S. Attorney Peace expressed his sincere thanks to the FBI’s Salt Lake City, Sacramento, Los Angeles, Newark and Houston Field Offices, with critical support provided by the Criminal Investigative Division’s Safe Streets Gang Unit, and HSI’s National Gangs and Violent Crime Unit, who spearheaded this investigation.  Additionally, FBI Legal Attaché in Mexico City, HSI Mexico, and the United States Customs and Border Protection Officers and Area Port Director Shawn Polley at the George Bush Intercontinental Airport in Houston provided critical support in connection with the arrests as well as the U.S. Attorney's Office for the Southern District of Texas for handling the initial appearance. 

Further, U.S. Attorney Peace recognized the numerous Department of Justice components that contributed to this indictment, including: the National Security Division’s Counterterrorism Section; the Organized Crime Drug Enforcement Task Forces Executive Office; the Office of International Affairs; and the Criminal Division’s Office of Overseas Prosecutorial Development, Assistance and Training and Organized Crime and Gangs Section.  In addition, the Department of State, Bureau of International Narcotics and Law Enforcement Affairs, and the United States Agency for International Development, Office of Inspector General have provided critical support for JTFV’s mission. 

The charges announced today are allegations, and the defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.  If convicted, the defendants face a maximum sentence of life in prison, and the four defendants charged with alien smuggling conspiracy, which resulted in death, also are eligible for the death penalty.

The government’s case is being prosecuted by Assistant U.S. Attorneys James Donnelly, Matthew Shepherd and Stewart Young from JTFV, with assistance from Assistant U.S. Attorneys Paul G. Scotti, Justina L. Geraci and Megan E. Farrell from the Office’s Long Island Criminal Division.

Defendants in U.S. Custody:

VLADIMIR ANTONIO AREVALO-CHAVEZ (also known as “Vampiro de Monserrat Criminales”)
Age:  47

WALTER YOVANI HERNANDEZ-RIVERA (also known as “Baxter de Park View” and “Bastard de Park View”)
Age:  29

MARLON ANTONIO MENJIVAR-PORTILLO (also known as “Rojo de Park View”)
Age:  47

Fugitive Defendants:

JOSE WILFREDO AYALA-ALCANTARA (also known as “Indio de Hollywood”)
Age:  55

JORGE ALEXANDER DE LA CRUZ (also known as “Cruger de Peatonales”)
Age:  45

JUAN ANTONIO MARTINEZ-ABREGO (also known as “Mary Jane de Hollywood”)
Age:  42

FRANCISCO JAVIER ROMAN-BARDALES (also known as “Veterano de Tribus”)
Age:  45

Defendants Believed to be in El Salvador Custody:

EDWIN ERNESTO CEDILLOS-RODRIGUEZ (also known as “Renuente de Abriles Dangers”)
Age:  35

CARLOS TIBERIO RAMIREZ-VALLADARES (also known as “Snayder de Pasadena”)

DANY FREDY RAMOS-MEJIA (also known as “Cisco de Teclas”)
Age:  44

DANY BALMORE ROMERO-GARCIA (also known as “Big Boy de Normandies,” “Dig Boy de Normandies,” and “D Boy de Normandies”)
Age: 48

RUBEN ANTONIO ROSA-LOVO (also known as “Chivo de Centrales”)
Age:  52

MIGUEL ANGEL SERRANO-MEDINA (also known as “Cabro de Park View”)
Age:  47

E.D.N.Y. Docket No.: 22-CR-429 (JMA)

Updated Press Release

An indictment was unsealed this morning in federal court in Brooklyn charging OZY Media Inc. (Ozy), a media and entertainment company headquartered in Mountain View, California, and its founder and Chief Executive Officer, Carlos Watson, with conspiracy to commit securities fraud and conspiracy to commit wire fraud in connection with a scheme to defraud Ozy’s investors and lenders by making material misrepresentations about Ozy’s financial and business assets.  Watson is also charged with aggravated identity theft for his role in the impersonation of multiple media company executives in communications with Ozy’s lenders and prospective investors in furtherance of the fraud schemes.  

Watson was arrested this morning and will be arraigned later today before United States Magistrate Judge Cheryl L. Pollak.  If convicted, Watson faces a mandatory minimum sentence of two years’ imprisonment and a maximum sentence of 37 years’ imprisonment.

Watson’s co-conspirators Samir Rao, Ozy’s Chief Operating Officer, and Suzee Han, Ozy’s Chief of Staff from June 2019 to October 2021, previously pleaded guilty to charges relating to their roles in the scheme.  The U.S. Securities and Exchange Commission (SEC) is taking concurrent enforcement action. 

Breon Peace, United States Attorney for the Eastern District of New York, and Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the arrest and indictment.

“As the indictment today alleges, Watson repeatedly attempted to entice both investors and lenders through a series of deliberate deceptions and fabrications.  The FBI and our partners in law enforcement will hold any individual willing to defraud investors and financial institutions accountable in the criminal justice system,” stated Assistant Director-in-Charge Driscoll.

The Scheme

As alleged in the indictment and court documents, Ozy is a media and entertainment company whose businesses include digital newsletters, television production, podcasts, and live events, the most prominent of which is a live festival known as “Ozy Fest.”  Watson founded Ozy in 2012 and has served as the company’s Chief Executive Officer since its inception.

Between approximately 2018 and 2021, Watson and his co-conspirators, including Rao and Han, orchestrated a scheme to defraud investors in and lenders to Ozy of tens of millions of dollars through fraudulent misrepresentations and omissions about key aspects of Ozy’s business, including Ozy’s financial results, debts, and audience size.  In addition, Watson and his co-conspirators lied to prospective investors about who else might be investing in Ozy, the existence and size of acquisition offers received by Ozy, the existence and timing of “Series C” and “Series D” financing rounds by Ozy, and the existence and terms of Ozy’s business contracts — going so far as to direct Ozy employees to create fake contracts with forged signatures to provide in due diligence.  On multiple occasions, when faced with questions from lenders or potential investors, Watson and his co-conspirators assumed the identities of and impersonated actual media company executives to cover up their prior fraudulent misrepresentations. 

Forged Cable Television Contract and Impersonation of Media Executive

In December 2019, Watson and his co-conspirators attempted to induce a bank to lend Ozy money based on misrepresentations and omissions about Ozy’s business.  Watson and his co-conspirators sought to secure the loan with anticipated revenues from a second season of an Ozy television show.  However, the contract between Ozy and the show’s cable network for the second season of the show was still under negotiation.  To induce the bank to make the loan sooner, Watson directed Ozy’s then-Chief Financial Officer (CFO) to send the bank a fake signed contract between Ozy and the cable network purporting to be for the second season.  When the then-CFO refused, Rao, with Watson’s approval, sent the fake contract — which contained terms favorable to Ozy and a forged signature — to the bank, copying the then-CFO.  Later that day, the then-CFO emailed Watson and Rao to say that she was resigning effective immediately.  She explained, “this . . . is illegal.  This is fraud.  This is forging someone’s signature with the intent of getting an advance from a publicly traded bank.”  She continued, “To be crystal clear, what you see as a measured risk — I see as a felony.”

In subsequent months, Watson and his co-conspirators continued to attempt to induce the bank to lend Ozy several million dollars based on misrepresentations and omissions, including regarding the expected revenue from the second season of the Ozy television show.  During these discussions, the bank requested to speak to a representative of the cable network.  To conceal the lies about Ozy’s relationship with the cable network and the status and terms of their agreement, Rao, with Watson’s approval, created a fake email address in the name of an actual executive of the cable network, which Rao used to impersonate the executive and communicate with the bank about the potential loan.

Attempted Fraudulent Investment and Impersonation of Another Media Executive

From approximately November 2020 through February 2021, Watson and his co-conspirators attempted to induce a financial institution to invest up to $45 million in Ozy by means of material misrepresentations and omissions regarding Ozy’s historical and projected financial results, debts, and business relationships.  Had the full $45 million investment occurred as intended, $6 million of the $45 million would have been paid to Watson personally. 

As part of its due diligence process, the financial institution asked Watson and Rao to arrange a meeting with someone from a well-known online video service that Watson and his co-conspirators claimed had paid Ozy nearly $6 million in licensing revenue for “The Carlos Watson Show.”  This was another misrepresentation — Ozy was never paid by this online video service for Ozy content.  Because Ozy did not in fact have any business relationship with the online video service, Watson and Rao agreed that Rao would impersonate a media executive at the online video service in communications with the financial institution.  On or about January 28, 2021, Rao, with Watson’s agreement, created a fake email address in the name of the media executive, which he used to correspond with representatives of the financial institution.

On or about February 2, 2021, Rao had a call with employees of the financial institution during which he impersonated a media executive from the online video service using a voice alteration application that he downloaded onto his cellular telephone to mask his voice during the call.  During the call, Watson was in the same room as Rao, and texted Rao instructions about what to say and what not to say on the call.  Shortly after the call, one of the employees of the financial institution contacted the actual media executive of the online video service, who confirmed that he had not been on the call and that the online video service had no role in the production of The Carlos Watson Show.  When members of the financial institution later spoke with Watson, he falsely claimed that Rao had acted alone and as a result of a mental breakdown.

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

The government’s case is being handled by the Office’s Business and Securities Fraud Section.  Assistant United States Attorneys Jonathan Siegel, Dylan A. Stern, and Gillian Kassner are in charge of the prosecution, with assistance from Paralegal Specialist Jake Menz.

The Defendants:

CARLOS WATSON
Age:  53
Mountain View, California

OZY MEDIA, INC.
Mountain View, California

E.D.N.Y. Docket No. 23-CR-82 (EK)

Earlier today, Damian Williams, United States Attorney for the Southern District of New York and Chair of the Attorney General’s Advisory Committee (AGAC) and Breon Peace, United States Attorney for the Eastern District of New York and the Chair of the White Collar Fraud Subcommittee of the AGAC, announced the implementation of the new United States Attorney’s Offices’ Voluntary Self-Disclosure Policy.  The policy, which is effective immediately, details the circumstances under which a company will be considered to have made a voluntary self-disclosure (VSD) of misconduct to a United States Attorney’s Office (USAO).  The policy provides transparency and predictability to companies and the defense bar concerning the concrete benefits and potential outcomes in cases where companies voluntarily self-disclose misconduct, fully cooperate, and timely and appropriately remediate.  The goal of the policy is to standardize how VSDs are defined and credited by USAOs nationwide, and to incentivize companies to maintain effective compliance programs capable of identifying misconduct, expeditiously and voluntarily disclose and remediate misconduct, and cooperate fully with the government in corporate criminal investigations.  The policy was developed pursuant to the Deputy Attorney General’s September 15, 2022 memorandum, “Further Revisions to Corporate Criminal Enforcement Policies Following Discussions with Corporate Crime Advisory Group” (Monaco Memo), which directed each Department of Justice (DOJ) component to develop and publish a VSD policy.

“The new Voluntary Self-Disclosure Policy sets a nationwide standard for how U.S Attorney’s Offices will determine whether a company has made a voluntary self-disclosure, and makes transparent the specific, tangible benefits to a company for making a voluntary self-disclosure, fully cooperating, and remediating the criminal conduct” stated United States Attorney Breon Peace.  “As a result, no matter where in the country a company operates, it can rely on receiving the same treatment and benefits for voluntarily self-disclosing criminal conduct to a U.S. Attorney’s Office.  We hope and expect that companies, as good corporate citizens, will take advantage of this new policy to report criminal misconduct by employees and agents when they become aware of it, so that individual wrongdoers can be held accountable.  When they do, they will have far better and more predicable outcomes under this policy.” 

U.S. Attorney Damian Williams said: “The new Voluntary Self-Disclosure Policy is an important step forward in encouraging corporate accountability.  This transparent and clearly delineated policy allows for more predictable outcomes, and seeks to incentivize corporations to do the right thing by reporting wrongdoing before detected by regulators and law enforcement. We hope that this new policy has a long-lasting, nationwide effect in promoting honest corporate culture and leads to more companies getting ahead of financial malfeasance before authorities come to them.”

The Monaco Memo instructed that each DOJ component that prosecutes corporate crime review its policies on corporate voluntary self-disclosure and, if there was no formal written policy to incentivize self-disclosure, draft and publicly share such a policy.  In response, the AGAC, under the leadership of U.S. Attorney Williams, requested that the White Collar Fraud Subcommittee, under the leadership of U.S. Attorney Peace, develop such a policy.  The policy announced today was prepared by a Corporate Criminal Enforcement Policy Working Group comprised of U.S. Attorneys from geographically diverse districts, including U.S. Attorney Peace, as well as U.S. Attorney for the Eastern District of Virginia Jessica Aber, U.S. Attorney for the District of Connecticut Vanessa Avery, U.S. Attorney for the District of Hawaii Clare Connors, U.S. Attorney for the Eastern District of North Carolina Michael F. Easley, Jr., U.S. Attorney for the Northern District of California Stephanie Hinds, U.S. Attorney for the Western District of Virginia Christopher Kavanaugh, and U.S. Attorney for the District of New Jersey Philip Sellinger.  Assistant U.S. Attorney Amanda Riedel, White Collar Crimes Coordinator for the Executive Office for U.S. Attorneys, also participated in the development of the policy. 

Under the new VSD policy, a company is considered to have made a VSD if it becomes aware of misconduct by employees or agents before that misconduct is publicly reported or otherwise known to the DOJ, and discloses all relevant facts known to the company about the misconduct to a USAO in a timely fashion prior to an imminent threat of disclosure or government investigation.  A company that voluntarily self-discloses as defined in the policy  and fully meets the other requirements of the policy, by—in the absence of any aggravating factor—fully cooperating and timely and appropriately remediating the criminal conduct (including agreeing to pay all disgorgement, forfeiture, and restitution resulting from the misconduct), will receive significant benefits, including that the USAO will not seek a guilty plea; may choose not to impose any criminal penalty, and in any event will not impose a criminal penalty that is greater than 50% below the low end of the United States Sentencing Guidelines (USSG) fine range; and will not seek the imposition of an independent compliance monitor if the company demonstrates that it has implemented and tested an effective compliance program.

The policy identifies three aggravating factors that may warrant a USAO seeking a guilty plea even if the other requirements of the VSD policy are met:  (1) if the misconduct poses a grave threat to national security, public health, or the environment; (2) if the misconduct is deeply pervasive throughout the company; or (3) if the misconduct involved current executive management of the company.  The presence of an aggravating factor does not necessarily mean that a guilty plea will be required; instead, the USAO will assess the relevant facts and circumstances to determine the appropriate resolution.  If a guilty plea is ultimately required, the company will still receive the other benefits under the VSD policy, including that the USAO will recommend a criminal penalty of at least a 50% and up to a 75% reduction off the low end of the USSG fine range, and that the USAO will not require the appointment of a monitor if the company has implemented and tested an effective compliance program.

 In cases where a company is being jointly prosecuted by a USAO and another DOJ component, or where the misconduct reported by the company falls within the scope of conduct covered by VSD policies administered by other DOJ components, the USAO will coordinate with, or, if necessary, obtain approval from, the DOJ component responsible for the VSD policy specific to the reported misconduct when considering a potential resolution.  Consistent with relevant provisions of the Justice Manual and as allowable under alternate VSD policies, the USAO may choose to apply any provision of an alternate VSD policy in addition to, or in place of, any provision of its policy.

واشنطن – مساء الأمس، قام مكتب المدعي العام الأمريكي للمقاطعة الشرقية لمدينة نيويورك ووزارة الأمن الداخلي الأمريكية ووزارة الخارجية الأمريكية ومعهد سميثونيان بالاشتراك في أحتفال تاريخي بإعادة 77 قطعة من ممتلكات الفن الحضاري المسروق والتي قام مسئولي حفظ القانون الأمريكي بالتحفظ عليها إلى حكومة جمهورية اليمن.

تشمل هذه الآثار 64 من الرؤوس الحجرية المحفورة و11 من صفحات مخطوطة للقرآن الكريم، وطبق من البرونز به كتابة، ونصب جنائزي من معان أو حضارات معين القبلية من المرتفعات الشمالية - الغربية في اليمن والتي تعود إلى القرن الأول قبل الميلاد.

تم مصادرة الرؤوس الحجرية المنحوتة ال 64 إلى الولايات المتحدة عن طريق تنفيذ أمر مصادرة قام به مكتب المدعي العام الأمريكي للمقاطعة الشرقية لمدينة نيويورك متعلق بالإقرار بالذنب الخاص بمهرب للآثار يدعى موسى خولي ومعروف باسم "موريس خولي" في شهر أبريل 2012. وطبقا للشكوى القضائية المتعلقة بالمصادرة، تم تهريب الرؤوس الحجرية المنحوتة ال 64 إلى الولايات المتحدة من دولة الأمارات العربية المتحدة مع مراسلات وإيصالات تحتوي على العديد من المعلومات الغير متناسقة وتم التحفظ عليها من منزل ومعرض خولي. تم مصادرة آثار أخرى في نفس القضية وإعادتها إلى مصر في شهر أبريل 2015.

صرح المدعى العام الأمريكي بريون بيس أن "مكتبنا ليفخر أن العمل الذي قام به في هذه القضية أدى إلى إعادة هذه الآثار الثقافية الهامة إلى موطنها الأصلي في اليمن".

صرح القائم بإعمال مساعد مدير تحقيقات وزارة الأمن الداخلي التنفيذي ستيف ك. فرانسيس أن "يتشرف مكتب تحقيقات وزارة الأمن الداخلي أن يعمل يدا بيد مع شركائنا الذين يشملوا وزارة الجمارك وتأمين الحدود الأمريكية ووزارة الخارجية الأمريكية ومكتب المدعي العام الأمريكي للمقاطعة الشرقية لمدينة نيويورك ومعهد سميثونيان والسفير محمد الحضرمي لإعادة كنز الآثار هذا إلى شعب اليمن،" كما أضاف أنه "كثيرا ما يحدث أن يتم إعطاء قيمة مالية للممتلكات والفن والتحف المسروقة في السوق، ولكن القيمة التاريخية والأهمية الحضارية لهذه الآثار تفوق بكثير أي قيمة مالية. أن مكتب تحقيقات وزارة الأمن الداخلي يفخر بأنه لعب دورا في وضع اليد واسترجاع هذا الأرث الحضاري الذي لا يُقدر بمال إلى الشعب اليمني ليستمتعوا به لأجيال قادمة".

صرح السفير محمد الحضرمي "بالنيابة عن حكومة اليمن، أعبر عن أمتناني الجزيل للحكومة الأمريكية وخاصة وزارة الأمن الداخلي الأمريكية ووزارة الخارجية الأمريكية ومكتب المدعي العام الأمريكي للمقاطعة الشرقية لمدينة نيويورك لكل الجهد المبذول في استرجاع وإعادة هذه الآثار اليمنية. منذ بداية الانقلاب الحوثي في اليمن، أضحى أرثنا وتاريخنا تحت الهجوم، وأن سفارة اليمن ستظل مستمرة في تواصلها مع الحكومة الأمريكية لتعقب واسترجاع الممتلكات والأرث التاريخي المسروق الخاص باليمن. أود أيضا أن أؤكد على أمتناني الشديد لمتحف السميثونيان الوطني للفن الآسيوي لموافقته على الاحتفاظ بهذه الآثار بصفة مؤقتة حتى يتم اعادتها بالكامل إلى اليمن في المستقبل".

يشكل إعادة هذه الآثار المسروقة علامة فارقة في العلاقات الأمريكية - اليمنية حيث إن انتهاء التحقيق الأمريكي الدؤوب للتعرف على وتحديد أماكن هذه الممتلكات الحضارية والتحفظ عليها والتأكد من مكانتها هو تاريخيا أكبر عدد من هذه الآثار التي قامت الحكومة الأمريكية باعادتها إلى المسئولين اليمنين منذ ما يقرب من 20 عاما.

قامت حكومة اليمن بالتوصل إلى أتفاق مع متحف السميثونيان الوطني للفن الآسيوي للأحتفاظ بهذه الآثار لمدة عامين قابلة للتمديد بطلب من الحكومة اليمنية، وستقوم السفارة بتقديم النصح بخصوص الوصول والبحوث والمحافظة على هذه القطع.

قام مساعد المدعى العام الأمريكي كلير س. كاديشيان من القسم الجنائي، قطاع استرجاع الممتلكات، بالأدعاء في هذه القضية.                                                                                      

المتهمين:

موسى خولي، والمعروف بإسم "موريس خولي"

العمر: 38 سنوات

بروكلين، نيويورك

سجل المقاطعة الشرقية لمدينة نيويورك رقم: CR 11-00340 (EDNY) (ERK)

الولايات المتحدة الأمريكية ضد العديد من الآثار والممتلكات الحضارية الُمتحفظ عليها بأسم آثار وندسور و/أو موسى خولي وشركائه CV 11-2889 (ERK).

Today, the U.S. Attorney’s Office for the Eastern District of New York, U.S. Department of Homeland Security (DHS), U.S. Department of State and the Smithsonian Institution participated in a milestone repatriation ceremony returning 77 pieces of stolen cultural property seized by U.S. law enforcement officials to the Republic of Yemen Government.

The antiquities included 64 relief carved stone heads, 11 Qur’an manuscript pages, a bronze inscribed bowl, and a Funerary Stele from Ma’în or Minaean tribal cultures in the highlands of North-West Yemen dating back to the 1st century BCE.

The 64 relief carved stone heads were forfeited to the United States in connection with an Eastern District of New York civil forfeiture action related to the April 2012 guilty plea of an antiquities smuggler, named Mousa Khouli, also known as “Morris Khouli.”  As alleged in the government’s forfeiture complaint, the 64 relief carved stone heads were smuggled into the United States from the United Arab Emirates with correspondence and invoices that contained multiple inconsistencies and were seized from the home and gallery of Khouli.  Other antiquities that were seized in this case were forfeited and subsequently repatriated to Egypt in April 2015.

“Our Office is proud that the work in our case is leading to these important cultural antiquities returning to their rightful home in Yemen,” stated United States Attorney Breon Peace.

“Homeland Security Investigations is honored to stand with our partners including U.S. Customs and Border Protection, the U.S. Department of State, the U.S. Attorney’s Office for the Eastern District of New York, the Smithsonian Institution, and Ambassador Mohammed Al-Hadhrami to return these treasured antiquities to the people of Yemen,” said HSI Acting Executive Associate Director Steve K. Francis. “Looted cultural property, art, and antiquities are often assigned a dollar value in the marketplace; however, the historical and cultural significance of these artifacts extends beyond any monetary value. HSI is proud to have played a role in the recovery and return of this priceless cultural heritage back to the Yemeni people so they can enjoy it for generations to come.”

Ambassador Mohammed Al-Hadhrami: “On behalf of the Government of Yemen, I express my deep gratitude to the US Government, in particular to the U.S. Department of Homeland Security, the Department of State and US Attorney’s Office for the Eastern District of New York for all efforts exerted in the retrieval and return of these Yemeni artifacts. Ever since the Houthis’ coup in Yemen, our heritage and history have been under attack. The Embassy of Yemen will continue its close engagement with the U.S. Government in pursuit of the restitution of Yemen’s stolen cultural heritage and property. I also affirm my substantial appreciation to the Smithsonian’s National Museum of Asian Art for agreeing to temporarily hold these antiquities until they are fully repatriated back to Yemen in the future.”

The return of these stolen antiquities marks a significant milestone in U.S.-Yemen relations, as the culmination of extensive U.S. investigative work to identify, locate, seize and confirm the status of this cultural property denotes historically the largest number of antiquities that have been returned by the U.S. government to Yemeni officials in nearly 20 years.

The Republic of Yemen Government and the Smithsonian’s National Museum of Asian Art have entered into a two-year custodial agreement with the option to renew at the request of the Republic of Yemen Government. The Embassy will advise on access to, research on and conservation of the objects.

The government’s case was prosecuted by Assistant United States Attorney Claire S. Kedeshian of the Criminal Division, Asset Recovery Section.

The Defendant:

MOUSA KHOULI, also known as “Morris Khouli”
Age: 38
Brooklyn, NY

E.D.N.Y. Docket No. CR 11-00340 (EDNY) (ERK)

United State of America v. Various Antiquities, Cultural Property and Assets held in the name of Windsor Antiques and/or Mousa Khouli, et. al. CV 11-2889 (ERK)

A federal jury today convicted Keith Wyche, also known as “Marco,” of distributing fentanyl which resulted in the fatal overdose of a 43-year-old Staten-Island resident on April 18, 2017.  Wyche and co-defendant Oneil Allen were also convicted of distributing heroin to a 28-year old woman on October 27, 2017, leading to her suffering serious bodily injury.  In addition, the two men were convicted of conspiring to distribute and possess with intent to distribute heroin and fentanyl, and distributing those narcotics.  The verdict followed a three-week trial in federal court in Brooklyn before United States District Judge Dora L. Irizarry.  When sentenced, both defendants face a mandatory minimum sentence of 20 years’ imprisonment.

Breon Peace, United States Attorney for the Eastern District of New York, James E. Dennehy, Special Agent-in-Charge, Federal Bureau of Investigation, Newark Field Office (FBI), and Keechant L. Sewell, Commissioner, New York City Police Department (NYPD), announced the verdict. 

“With today’s verdict, two drug dealers who sold lethal drugs without any regard for the lives they were endangering, have received a powerful response from the jury holding them responsible for their crimes,” stated United States Attorney Peace.  “The opioid epidemic has had a devastating effect on our district, with Staten Island bearing a terrible toll, and this Office will continue working tirelessly to reduce the number of victims and the availability of dangerous drugs.”

“Dealers and pushers are hooking users with a dangerously addictive mix of drugs that shouldn’t ever be used outside of a medical environment.  Mr. Wyche and Mr. Allen would text customers first thing in the morning to keep their clientele coming back.  Their goal was to make more money, disregarding one man’s life and the lives of others to whom they sold.  The FBI Newark Transnational Organized Crime Task Force has a message for criminals at the root of this growing epidemic plaguing our communities - there is a federal prison cell waiting for you as well,” stated FBI Special Agent-in-Charge Dennehy.

“Abuse of heroin and the deadly additive fentanyl has cut a wide swath across New York City and our nation, affecting people in all neighborhoods, from all walks of life,” stated NYPD Commissioner Sewell.  “To combat this scourge, we seek to shut down the supply of illegal drugs and, ultimately, to save lives.  That is why NYPD detectives probe every overdose to determine how the narcotics were obtained, and it was those efforts that led to today’s verdict.  I commend the investigators in this case, and the strong collaboration of the NYPD and our law enforcement partners, all of whom are helping to stem the opioid crisis.”

As proven at trial, Wyche and Allen ran a narcotics delivery service, distributing heroin and fentanyl, among other drugs, in Staten Island.  The defendants used a stash house in New Jersey to package and prepare narcotics, and traveled daily into Staten Island to sell their illicit product.  On the days they distributed narcotics, they would alert customers early in the morning with text messages reading “Good Morning” or “Rise and Shine,” and then coordinate meetups with customers.

On April 18, 2017, the father of a 43-year old Staten Island man (“John Doe”) found his son dead in a bathroom of a residence in Staten Island.  A hypodermic needle, tourniquet, and glassines containing fentanyl were on and around the body.  By reviewing the deceased victim’s phone, NYPD detectives found a series of text messages from a number labeled “Marco 5.”  These messages began with a text from the contact “Marco 5” that started with “Rise and Shine,” and showed that the user of this phone had sold narcotics to John Doe in the hours before his overdose.   

On October 27, 2017, NYPD Officers responded to a 911 call for a 28-year old woman (“Jane Doe”) who was reported as unconscious inside a vehicle in Staten Island.  After first responders administered several doses of Narcan to Jane Doe, she regained consciousness and was transported to a hospital.  A review of messages on Jane Doe’s phone showed similar messages to those found on John Doe’s phone, including a message reading “Rise and Shine” on the day of Jane Doe’s overdose.  Jane Doe testified at trial that she purchased narcotics from the defendants and later helped law enforcement gather evidence against them.

The government’s case is being prosecuted by Assistant United States Attorneys Gilbert M. Rein, Irisa Chen, and James P. McDonald, with assistance from Paralegal Specialists Teri Carby and Eileen Rosado.

The Defendants:

KEITH WYCHE (also known as “Marco”)
Age: 38
Staten Island, New York

ONEIL ALLEN (also known as “James”)
Age: 31
Staten Island, New York

E.D.N.Y. Docket No. 18-CR-561 (S-1) (DLI)

Genaro Garcia Luna, the former Secretary of Public Security in Mexico from 2006 to 2012, was convicted today by a federal jury in Brooklyn of all five counts of a superseding indictment charging him with engaging in a continuing criminal enterprise that includes six drug-related violations, international cocaine distribution conspiracy, conspiracy to distribute and possess with intent to distribute cocaine, conspiracy to import cocaine, and making false statements. The verdict followed a four-week trial before United States District Judge Brian M. Cogan.  When sentenced, Luna faces a mandatory minimum sentence of 20 years’ imprisonment and a maximum of life in prison. 

Breon Peace, United States Attorney for the Eastern District of New York, Anne Milgram, Administrator, U.S. Drug Enforcement Administration (DEA), and Ivan J. Arvelo, Special Agent-in-Charge, Homeland Security Investigations, New York (HSI), announced the verdict.

“Garcia Luna, who once stood at the pinnacle of law enforcement in Mexico, will now live the rest of his days having been revealed as a traitor to his country and to the honest members of law enforcement who risked their lives to dismantle drug cartels,” stated United States Attorney Peace.  “It is unconscionable that the defendant betrayed his duty as Secretary of Public Security by greedily accepting millions of dollars in bribe money that was stained by the blood of Cartel wars and drug-related battles in the streets of the United States and Mexico, in exchange for protecting those murderers and traffickers he was solemnly sworn to investigate.  Today’s verdict is a shining light for the rule of law, right over wrong, and justice over injustice for all those who have suffered as a result of the defendant’s deplorable crimes.”

“Today’s conviction of Genaro Garcia Luna clearly shows that DEA will stop at nothing to pursue corrupt political officials who engage in drug trafficking and violence,” said DEA Administrator Anne Milgram. “Garcia Luna, the former Secretary of Public Security in Mexico, received millions of dollars in bribes from the Sinaloa cartel in exchange for protecting its drug trafficking activities and facilitating the importation of cocaine and other drugs into the United States. This case affirms DEA’s dedication to target and bring to justice those that enable the Sinaloa criminal drug cartel to flood the U.S. with deadly drugs that are killing Americans at unprecedented rates. It should send a clear message – to all political leaders around the world that trade on positions of influence to further transnational organized crime – that DEA will relentlessly pursue drug trafficking organizations that threaten the safety and health of the American people.”

HSI New York Special Agent in Charge Ivan J. Arvelo: “Criminal organizations cannot function at the level of the Sinaloa drug cartel without the support of corrupt politicians and officials such as Genaro Garcia Luna who aid and abet them. Garcia Luna, a trusted public servant, used his official position to assist this violent drug cartel in exchange for millions of dollars in bribes. Not only did Garcia Luna betray his position, his people and his country, his actions facilitated the importation of tons of illicit drugs into the United States. Corrupt officials like Garcia Luna create a dangerous work environment for U.S. law enforcement who often share sensitive information with the Mexican government to stem the flow of dangerous narcotics into the United States. HSI, along with our law enforcement partners, will aggressively pursue individuals and organizations that negatively impact the national security of the United States and the safety of its citizens.”

As proven at trial, from 2006 to 2012, Garcia Luna was Mexico’s top law enforcement official, serving as Secretary of Public Security and, in that capacity controlled Mexico’s Federal Police Force.  Previously, from 2001 to 2005, the defendant was the head of Mexico’s Federal Investigative Agency (“AFI”).  The defendant used his official positions to assist the violent Sinaloa drug cartel in exchange for millions of dollars in bribes.  Garcia Luna’s conduct included facilitating the safe passage for the Cartel’s drug shipments, providing sensitive law enforcement information about investigations into the Cartel, and helping the Cartel attack rival drug cartels, thereby facilitating the importation of multi‑ton quantities of cocaine and other drugs into the United States.

The evidence included testimony from former high-ranking members of the Sinaloa Cartel with direct knowledge of the defendant’s corrupt activities.  For example, in exchange for bribes, the defendant’s Federal Police Force acted as bodyguards and escorts for the Cartel, allowing Cartel members to wear police uniforms and badges, and helped unload shipments of cocaine from planes at Mexico City’s airport, then delivered the cocaine to the Cartel. The defendant was paid in U.S. currency — $100 bills in bundles of $10,000 at times — stuffed variously in a suitcase, briefcases and duffel bags.  The bribe amounts increased over the years as the Sinaloa Cartel grew in size and power through the assistance of the defendant.   Former members of the Cartel testified that bribe money was handed off to the defendant in a variety of locations, including at a “safe house” located in Mexico City where large amounts of cash were hidden in a false wall,  at a car wash in Guadalajara, and at a French restaurant in Mexico City across the street from the U.S. Embassy.  Further, in exchange for the millions of dollars that the defendant was receiving in bribes, his federal police leaked sensitive information that enabled the Cartel to evade detection by law enforcement or use the information in attacks on rival traffickers.

Finally, after moving to the United States in 2012, Garcia Luna submitted an application for naturalization in 2018, in which he lied about his past criminal conduct on behalf of the Sinaloa Cartel in an attempt to become a U.S. citizen.

Garcia Luna’s co-defendants in the superseding indictment, Luis Cardenas Palomino and Ramon Pequeno Garcia, former high-ranking Mexican law enforcement officials who worked under Garcia Luna, remain fugitives from U.S. authorities.

The investigation was led by the New York Strike Force, a crime-fighting unit comprising federal, state and local law enforcement agencies supported by the Organized Crime Drug Enforcement Task Force and the New York/New Jersey High Intensity Drug Trafficking Area.  The Strike Force is based at the DEA’s New York Division and includes agents and officers of the DEA, New York City Police Department, New York State Police, Homeland Security Investigations, U.S. Internal Revenue Service Criminal Investigation Division, Bureau of Alcohol, Tobacco, Firearms and Explosives, U.S. Customs and Border Protection, U.S. Secret Service, United States Marshals Service, New York National Guard, Clarkstown Police Department, U.S. Coast Guard, Port Washington Police Department and New York State Department of Corrections and Community Supervision.

The government’s case is being handled by the Office’s International Narcotics and Money Laundering Section.  Assistant U.S. Attorneys Saritha Komatireddy, Erin Reid, Philip Pilmar, Marietou Diouf, and Adam Amir are in charge of the prosecution, with the assistance of Paralegal Specialists Huda Abouchaer, Melissa Bennett, and Bridget Donovan. 

The Defendant:

GENARO GARCIA LUNA
Age:  54
Miami, Florida

E.D.N.Y. Docket No. 19-CR-576 (BMC)

Daniel E. Russo pleaded guilty today in federal court in Brooklyn to conspiracy to distribute and possess with intent to distribute oxycodone, distribution and possession of oxycodone, and nine counts of filing false personal and corporate tax returns.  The proceeding was held before United States District Judge Dora L. Irizarry.   When sentenced, Russo faces up to 20 years’ imprisonment for each of the drug counts and up to three years’ imprisonment for each of the tax counts.

Breon Peace, United States Attorney for the Eastern District of New York, Stuart M. Goldberg, Acting Deputy Assistant Attorney General of the Justice Department’s Tax Division, Frank A. Tarentino III, Special Agent-in-Charge, Drug Enforcement Administration, New York Division (DEA), and Thomas Fattorusso, Special Agent-in-Charge, Internal Revenue Service Criminal Investigation, New York (IRS-CI), announced the guilty plea.

“Russo was a drug dealer in a white coat,” stated United States Attorney Peace.  “He abused his pharmacy license and the trust placed in him by the community to illegally distribute enormous amounts of oxycodone, spreading misery in the community and fueling addiction, all to enrich himself.  This Office will continue working with federal and local law enforcement partners to investigate and prosecute medical professionals who illegally deal dangerous drugs with the same vigor as those who distribute drugs on the street.”

“At the same time Daniel Russo was illegally peddling oxycodone out of his pharmacy, he was pocketing – and not paying taxes on – income from those sales and others in his business,” stated Acting Deputy Assistant Attorney General Goldberg.  “Everyone is required to pay their fair share of taxes, whether they make their money legitimately or through criminal activity.”

“This plea solidifies the fact that Russo blatantly ignored his role as a medical practitioner in order to line his pockets with cash,” stated DEA Special Agent-in-Charge Tarentino.  “Through this illicit scheme, Russo enabled opioid addiction and misuse throughout Queens and Long Island communities. The DEA Long Island District Office-Tactical Diversion Squad, HHS-OIG, IRS, and the U.S. Attorney’s Office Eastern District of New York’s partnership exemplifies how investigations like this successfully arrest and prosecute individuals in positions that threaten public safety.”

“Instead of acting within the pharmacist code of ethics to act with integrity, Russo chose to use his position to commit criminal acts.  He chose to distribute highly addictive drugs to the community he served, then failed to report and pay taxes on the proceeds of his illicit sales.  Today, Russo chose to face the consequences of his actions—a good reminder that just like Al Capone, even criminals need to pay their taxes,” stated IRS-CI Special Agent-in-Charge Fattorusso. 

As set forth in the indictment, court filings and in court this morning, Russo owned and operated Russo’s Pharmacy in Far Rockaway, Queens.  Between March 2011 and June 2014, Russo conspired with others, including medical professionals and employees, to fill fraudulent prescriptions for oxycodone and dispense thousands of oxycodone pills in return for hundreds of thousands of dollars in cash.  Over the course of the conspiracy, Russo’s co-conspirators delivered hundreds of fraudulent oxycodone prescriptions to Russo’s Pharmacy and would then retrieve the filled prescriptions—written out in various patients’ names—so that they could be dispensed elsewhere.  Russo accepted payment mostly in cash for the prescriptions.  Russo then hid the proceeds from the scheme and filed false corporate income tax returns for his pharmacy for the years 2013 through 2016, omitting the illegal proceeds.  Russo also filed false individual income tax returns for the years 2012 through 2016.  In total, Russo failed to report over $1 million in earnings,  much of it generated from his oxycodone distribution scheme. 

More than a dozen physicians for whom Russo filled prescriptions have since been convicted of crimes related to the distribution of oxycodone.

The government’s investigation was led by the DEA’s Long Island Tactical Diversion Squad, comprising agents and officers of the DEA, Nassau County Police Department, Suffolk County Police Department, Port Washington Police Department and Rockville Centre Police Department.  The DEA Tactical Diversion Squad also worked in conjunction with officers and agents of the U.S. Department of Health & Human Services’ Office of the Inspector General and New York City Department of Investigation. 

This case is the latest in a series of federal prosecutions by the United States Attorney’s Office for the Eastern District of New York as part of the Prescription Drug Initiative.  In January 2012, this Office and the DEA, in conjunction with the five District Attorneys in this district, the Nassau and Suffolk County Police Departments, the New York City Police Department, the New York State Police and other key federal, state and local government partners launched the initiative to mount a comprehensive response to what the United States Department of Health and Human Services Center for Disease Control and Preventions called an epidemic increase in the abuse of so-called opioid analgesics.  To date, the initiative has brought over 160 federal and local criminal prosecutions including the prosecution of 20 health care professionals; taken civil enforcement actions against a hospital, a pharmacy and pharmacy chain; removed prescription authority from numerous rogue doctors and expanded information-sharing among enforcement agencies to better target and pursue drug traffickers.  The initiative also is involved in an extensive community outreach program to address the abuse of pharmaceuticals.

The government’s case is being prosecuted by Assistant United States Attorneys Francisco J. Navarro, Nomi D. Berenson and Andrew D. Wang and Trial Attorney Michael C. Vasiliadis of the Tax Division.

The Defendant:

DANIEL E. RUSSO
Age:  44
Cedarhurst, New York

E.D.N.Y. Docket No. 20-CR-23 (DLI)

Adrian Lawrence, a citizen of Jamaica, will be arraigned this afternoon in federal court in Central Islip on a six-count indictment charging him with conspiracy to commit mail and wire fraud, mail fraud and wire fraud, in connection with a scheme to defraud U.S. citizens.  Today’s proceeding will be held before United States Magistrate Judge Anne Y. Shields.  Lawrence was detained last month in Panama and extradited to the United States on February 8, 2023, at the request of U.S. authorities.

Breon Peace, United States Attorney for the Eastern District of New York, Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), Daniel B. Brubaker, Inspector-in-Charge, United States Postal Inspection Service, New York Field Office (USPIS), and J. Russell George, Treasury Inspector General for Tax Administration (TIGTA), announced the arrest and charges.

“As alleged, Lawrence and his co-conspirators preyed on dozens of elderly persons, contacting the victims by phone and email, spinning the lie that they had won a sweepstakes prize, then having gained their trust, betrayed them by extracting a purported fee to collect the non-existent winnings,” stated United States Attorney Peace.  “Today’s arrest demonstrates our Office’s commitment to aggressively investigate and prosecute those individuals who exploit our senior citizens for personal gain.”   

Mr. Peace expressed his thanks to the Justice Department’s Office of International Affairs for their valuable assistance with this case.

“As alleged, Lawrence defrauded dozens of elderly victims of collectively more than $5 million by willfully misleading them to believe they had won a sweepstakes and needed to pay fees to release their winnings.  After the victims paid the fees, they came to the unfortunate realization that the prizes they had been promised were non-existent.  While elder fraud continues to be a persistent crime problem, today’s action should serve as a reminder the FBI will continue to do all we can to protect the vulnerable  from those who seek to take advantage of them for their own greedy purposes,” stated FBI Assistant Director-in-Charge Driscoll.

USPIS Inspector-in-Charge Brubaker stated: “Postal Inspectors have been in the business of tracking down fugitives for over 200 years. With the assistance of the U.S. Marshals Service Fugitive Task Force and the U.S Attorney’s Office, Adrian Lawrence will face justice in the Eastern District of New York.  Lawrence, a Jamaican national, is allegedly the head of a scamming operation that defrauded more than 50 victims out of more than $5 million dollars over the past 10 years. This arrest should serve as a clear message to Lawrence and anyone else involved in lottery or sweepstakes scams, that if you prey upon the American public there will be consequences. No matter how far you run, or how good you think you can hide, justice will always find you. Postal Inspectors remind everyone that you can’t win a lottery or sweepstakes that you didn’t enter, and that you NEVER have to pay any amount to collect a legitimate prize.”

“The Treasury Inspector General for Tax Administration aggressively investigates individuals who impersonate Internal Revenue Service employees or who use the IRS’s tax collecting authority to scam others, especially seniors and other vulnerable populations,” stated Treasury Inspector General for Tax Administration J. Russell George.  “We are committed to working with our law enforcement partners and the United States Attorney’s Office to ensure those who endeavor to corrupt federal tax administration are prosecuted to the fullest extent of the law.”

As set forth in the indictment and court filings, between October 2013 and April 2020, Lawrence, also known as “Mastermind,” and his co-conspirators carried out a scheme via telephone and email to defraud elderly United States citizens (the “Victims”) by falsely telling the Victims that they had won certain sweepstakes contests that were sponsored by Publishers Clearing House, federal agencies such as the Federal Trade Commission, and other entities.  Lawrence also told the Victims that in order to facilitate the release of their sweepstakes prizes, the Victims first needed to wire-transfer money to various bank accounts that he had his co-conspirators established at bank branches in the United States, and to mail checks and cash to Lawrence’s co-conspirators throughout the United States, in order to pay for purported fees.  In reality, Lawrence knew that the Victims owed no fees and had won no sweepstakes prizes.  Lawrence used a variety of aliases, email addresses and phone numbers to perpetrate the scheme.  At least 50 victims, whose average age was 81-years-old, sent more than $5.6 million to Lawrence and his co-conspirators.

The charges in the indictment are allegations, and Lawrence is presumed innocent unless and until proven guilty.  If convicted, the defendant faces up to 20 years in prison.

The government’s case is being handled by the Office’s Long Island Criminal Division.  Assistant United States Attorney Christopher Caffarone is in charge of the prosecution. 

The Defendant:

ADRIAN LAWRENCE (also known as “Mastermind”)
Age:  31
Jamaica

E.D.N.Y. Docket No. 22-CR-159 (JMA)

Earlier today, in federal court in Brooklyn, Kambiz Attar Kashani, a dual citizen of the United States and Iran, was sentenced by United States District Judge Eric R. Komitee to 30 months’ imprisonment for conspiring to illegally export U.S. goods, technology, and services to end users in Iran, including the Government of Iran, in violation of the International Emergency Economic Powers Act (IEEPA).  The defendant has agreed to pay a $50,000 fine. Kashani pleaded guilty to the charge in June 2022.

Breon Peace, United States Attorney for the Eastern District of New York, Matthew G. Olsen, Assistant Attorney General for the Justice Department’s National Security Division, and Joseph R. Bonavolanta, Special Agent-in-Charge, Federal Bureau of Investigation, Boston Division (FBI), announced the sentence.

“Kashani defied export restrictions and sanctions against Iran, a country that sponsors international terrorism,” stated United States Attorney Peace. “His scheme undermined U.S. foreign policy and national security interests, and warranted a substantial sentence of incarceration to deter others.”

“Kashani conspired to illegally export U.S. goods and technology for the benefit of the Central Bank of Iran, a designated entity that materially supports known terrorist organizations,” said Assistant Attorney General Olsen. “The Department remains vigilant against any efforts to circumvent our export control laws, which exist to protect the security of the United States and its people.”

“Kambiz Attar Kashani will now head to prison for strengthening the economy of one of the world’s most infamous state sponsors of terrorism to line his own pockets, while circumventing U.S. laws in place to protect our national security interests. He used two United Arab Emirates companies to procure items from multiple American technology companies, including one located right here in Massachusetts,” said Special Agent in Charge of the FBI Boston Division Bonavolonta. “Today’s sentencing should send a strong message that the FBI and its law enforcement partners will continue to pursue and hold accountable those individuals who illegally export our country’s sensitive information and technology to hostile nations such as the Government of Iran.”

Between February 2019 and June 2021, Kashani conspired to illegally export goods and technology to end users in Iran, including the Central Bank of Iran (CBI). The U.S. government recognizes CBI as an agency of the Government of Iran and the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) has classified it as a Specially Designated National (SDN) acting for or on behalf of a terrorist organization.  According to the U.S. government, CBI has materially assisted, sponsored and provided financial, material or technological support, goods or services to Lebanese Hizballah, a terrorist organization, and to the Qods Force of Iran’s Islamic Revolutionary Guards Corps (IRGC), which is a branch of the Iranian armed forces and represents the primary means of the Government of Iran to direct and implement its global terrorism campaign.   

Kashani and his co-conspirators perpetrated the illegal transshipping scheme through two separate United Arab Emirates (UAE) companies.  They used the UAE companies to procure electronic goods and technology from multiple U.S. technology companies, including one located in Brooklyn, for end users in Iran, including CBI, without obtaining required OFAC export licenses.  Certain of the goods and technology Kashani and his co-conspirators transshipped were classified by the U.S. Department of Commerce’s Bureau of Industry and Security as information security items subject to national security and anti-terrorism controls.  Kashani and his co-conspirators intentionally concealed from the U.S. companies that they intended to send the items to Iran, falsely claiming that the UAE companies would be the ultimate end users.   

As set forth in court papers, by providing the Government of Iran and end users in Iran with sophisticated, top-tier U.S. electronic equipment and software, the defendant and his co-conspirators enabled the Iranian banking system to operate more efficiently, effectively, and securely.  In doing so, the defendant and his co-conspirators likely helped strengthen Iran’s economy and provided faster and more secure access to funds that enable the Government of Iran to further priorities including its nuclear program and terrorist agenda – exactly what the U.S. sanctions against Iran were intended to prevent.

The government’s case is being handled by the Office’s National Security and Cybercrime Section.  Assistant United States Attorneys Alexander A. Solomon and Meredith A. Arfa are in charge of the prosecution, with assistance provided by Trial Attorney S. Derek Shugert of the Justice Department’s Counterintelligence and Export Control Section.

Defendant:

Kambiz Attar Kashani
Age:  45
United Arab Emirates

E.D.N.Y. Docket No. 22-CR-33 (EK)

Earlier today in federal court in Brooklyn, New York, Kambiz Attar Kashani, 44, a dual citizen of the United States and Iran, was sentenced to 30 months in prison for conspiring to illegally export U.S. goods and technology to end users in Iran, including the Central Bank of Iran, in violation of the International Economic Powers Act (IEEPA). The Central Bank of Iran is an Iranian government agency that, according to the U.S. government, has materially supported Lebanese Hizballah and the Qods Force of Iran’s Islamic Revolutionary Guards Corps, both designated terrorist organizations.

“Kashani conspired to illegally export U.S. goods and technology for the benefit of the Central Bank of Iran, a designated entity that materially supports known terrorist organizations,” said Assistant Attorney General Matthew G. Olsen of the Justice Department’s National Security Division. “The Department remains vigilant against any efforts to circumvent our export control and sanctions laws, which exist to protect the security of the United States and its people.”

“Kashani defied export restrictions and sanctions against Iran, a country that sponsors international terrorism,” said U.S. Attorney Breon Peace for the Eastern District of New York. “His scheme undermined U.S. foreign policy and national security interests and warranted a substantial sentence of incarceration to deter others.”

“This is a sobering reminder that illegally exporting material is not an abstract economic concern – it is a crime with a direct impact on the safety of the American people,” said Assistant Director Alan E. Kohler Jr. of the FBI Counterintelligence Division. “Kambiz Attar Kashani pleaded guilty to conspiring to illegally export technologies and goods to Iran, a designated state sponsor of terrorism. The recipient of these technologies was the Central Bank of Iran, an entity connected to organizations such as Iran’s Qods Force and Lebanese Hizbollah, both designated terrorist groups that represent a clear and present threat to the United States. As long as these threats persist, the FBI will not rest in our efforts to find these illegal exporters and bring them to justice.”

According to court documents, between February 2019 and June 2021, Kashani and his co-conspirators used two front companies in the United Arab Emirates (UAE) to illegally procure electronic goods and technology from multiple U.S. technology companies, including one located in Brooklyn, for end users in Iran, including the Central Bank of Iran. Certain goods and technology Kashani and his co-conspirators transshipped were controlled by the U.S. government for national security and anti-terrorism reasons. Kashani and his co-conspirators intentionally concealed from the U.S. companies that they intended to send the items to Iran, falsely claiming that the UAE companies would be the ultimate end users. By providing the Central Bank of Iran and other end users in Iran with sophisticated, top-tier U.S. electronic equipment and software, Kashani and his co-conspirators enabled the Iranian banking system to operate more efficiently, effectively and securely.

The FBI is investigating the case.

Assistant U.S. Attorneys Alexander A. Solomon and Meredith A. Arfa for the Eastern District of New York are prosecuting the case, with assistance provided by Trial Attorney S. Derek Shugert of the National Security Division’s Counterintelligence and Export Control Section.

Earlier today, in federal court in Brooklyn, Ppassim Elder, also known as “Bsam,” “Big Sam” and “Sam,” and Wilbert Bryant, also known as “Will” and “La,” were sentenced by United States District Judge William F. Kuntz II, to terms of imprisonment of 202 years and 40 years, respectively. The defendants were sentenced for extortion and fraud offenses following their conviction after a three-week trial in September and October 2021.  At trial, the evidence showed that Elder and Bryant participated in an extortion scheme during which one victim was pistol-whipped and another victim was fatally shot in the face.   

Breon Peace, United States Attorney for the Eastern District of New York, announced the sentence.

“The defendants are guilty of multiple crimes of violence and fraud that victimized many persons, including the patriarch of a Queens family who was gunned down in his place of business,” stated United States Attorney Peace.  “The defendants will deservedly serve lengthy prison sentences for their ruthless and vicious conduct.”

Mr. Peace also expressed his thanks to the Federal Bureau of Investigation, New York Field Office, the New York City Police Department, and the Queens County District Attorney’s Office for their assistance during the investigation and prosecution.

As proven at trial, on the morning of October 23, 2017, Bryant and two co-conspirators entered Garden Valley Distributors, a family-owned wholesale distribution center in Ozone Park, Queens.  The perpetrators said that “Big Sam” sent them to collect his money.  Earlier that year, Elder, who was known as “Big Sam,” had loaned Hani Kasem’s son money, which the son used to support the business.  When Elder demanded full repayment, the son was unable to repay the debt because the money had been used to purchase merchandise for the business.  Elder then began a campaign of intimidation against the son and his family.  On one occasion, Elder paid co-conspirators to throw a rock through a window of the victim’s home.  On another occasion, Elder barged into Kasem’s home, intimidating members of his family.  Finally, Elder dispatched Bryant and two co-conspirators to the Garden Valley Distributors business where the perpetrators brandished a firearm, pistol-whipped the son and shot Kasem in the face, mortally wounding him. 

In addition to the murder, Elder extorted another person whose brother had stolen the proceeds of a fraud scheme perpetrated by Elder.  Although the victim was not involved in the theft, Elder punched him in his face in front of his daughters, breaking and bloodying his nose in order to “send a message” to the victim’s brother.  Elder and Bryant were also convicted of bank fraud conspiracy for lying to banks about the true owner of certain bank accounts, which permitted Elder to defraud innocent victims across the country, including an elderly man who lost over $30,000 when he was tricked into believing he was purchasing a car and another individual who lost over $150,000 when he was defrauded into believing he was purchasing two real estate properties.  Elder was also convicted of crimes committed after his arrest in this case, including stealing his attorney’s identity and lying to federal officials.

This case was brought as part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone.  As part of the program, U.S. Attorneys’ Offices work in partnership with federal, state, local and tribal law enforcement and their local communities to develop effective, locally based strategies to reduce violent crime.  

The government’s case is being handled by the Office’s Organized Crime and Gangs Section.  Assistant United States Attorneys Genny Ngai and Anna L. Karamigios are in charge of the prosecution. 

The Defendants:

PPASSIM ELDER (also known as “Bsam,” “Sam,” and “Big Sam”)
Age: 43 
Staten Island, New York

WILBERT BRYANT (also known as “Will” and “La”)
Age: 58
Brooklyn, New York

E.D.N.Y. Docket No. 18-CR-92 (S-5) (WFK)

A federal jury in Central Islip today returned a guilty verdict against James Tunstall for distributing heroin, which resulted in the fatal overdose of 24-year-old Sergio Niko Alvarez on October 29, 2018 in Jericho, New York.  The verdict followed a five-day trial before United States District Judge Joan M. Azrack.

Breon Peace, United States Attorney for the Eastern District of New York, and Frank A. Tarentino III, Special Agent-in-Charge, Drug Enforcement Administration, New York Division (DEA), announced the verdict.

“Tunstall, an admitted drug dealer, is held responsible by today’s verdict for selling heroin that killed a young man on Long Island, an all-too-frequent occurrence in this district and our country due to the proliferation of illegal drugs and the callous disregard for life displayed by the defendant and others,” stated United States Attorney Peace.  “I commend the prosecutors from my Office, the Special Agents of the DEA, and the members of the Long Island Heroin Task Force for their outstanding working on this case.  We will continue our comprehensive efforts to fight against this terrible opioid epidemic.”  

U.S. Attorney Peace extended special thanks to the Nassau County Police Department for its partnership throughout the investigation and prosecution.

“This conviction is a sobering reminder of the devastation and senseless loss of life inflicted by drug traffickers,” stated DEA Special Agent-in-Charge Tarentino.  “DEA and our task forces are committed to bringing to justice those responsible for fueling drug overdose and poisonings and defeating the drug cartel's lethal criminal empires.”

As proven at trial, Tunstall was a drug dealer who regularly sold cocaine and heroin to customers in Nassau County.  The defendant met the victim at an outpatient rehabilitation facility in Mineola, and even sold him cocaine in the bathroom of the facility.  Tunstall’s co-defendant, Jay Tenem, a drug addict who also met the defendant in a rehabilitation program, delivered the fatal dose of heroin from Tunstall to the victim on October 28, 2018, in exchange for heroin of his own to use.  Tenem collected the victim’s payment for the heroin, and brought the cash back to Tunstall.  The victim was found dead of heroin intoxication the next morning in his bedroom, by his mother.  The evidence included text messages between the defendant and the victim, and between Tenem and the victim.  In those messages, the defendant negotiated prices for the drugs with the victim, and told him “I don’t do this for fun.”  

Tenem pleaded guilty in February 2019 to distributing the heroin that caused Alvarez’s death and is awaiting sentencing. 

Tunstall pleaded guilty in July 2021 to conspiracy to distribute heroin and cocaine, and was sentenced by the Court in December 2022 to 20 years’ imprisonment.  When sentenced in this case, for causing Alvarez’s death, Tunstall faces up to life in prison.

The government’s case is being handled by the Office’s Long Island Criminal Division.  Assistant United States Attorneys Justina Geraci and Samantha Alessi are in charge of the prosecution, with assistance from Paralegal Specialist Michael Compitello.

The Defendant:

JAMES T. TUNSTALL (also known as “Math”)
Age:  48
Freeport and Westbury, New York

E.D.N.Y. Docket No. 18-CR-675 (JMA)

Today, a federal jury in Brooklyn convicted Ruslan Maratovich Asainov, a U.S. citizen and former resident of Bay Ridge, New York, of all five counts of an indictment charging him with conspiracy to provide material support to ISIS; providing material support to ISIS in the form of personnel, training, expert advice and assistance; receipt of military-type training from ISIS; and obstruction of justice.  The jury also found that the defendant’s provision of material support to ISIS resulted in the death of one or more persons.  The verdict followed a two-week trial before United States District Judge Nicholas G. Garaufis.  When sentenced, Asainov faces up to life in prison.

Breon Peace, United States Attorney for the Eastern District of New York; Matthew G. Olsen, Assistant Attorney General for the Justice Department’s National Security Division; Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI); and Keechant L. Sewell, Commissioner, New York City Police Department (NYPD), announced the verdict.

“As proven at trial, Asainov was a member of ISIS, a violent foreign terrorist organization, which has committed numerous acts resulting in the deaths of many U.S. citizens and others,” stated United States Attorney Peace.  “The defendant committed to the terrorist organization’s evil cause and made an extraordinary journey to the battlefield in Syria, where he became a lethal sniper for ISIS and trained many other ISIS members to kill.  Even after being captured, he still pledged his allegiance to ISIS.  Today’s verdict in an American courtroom is a victory for our system of justice, and against ISIS and those like the defendant who are committed to murdering innocent people here in the United States and abroad.”

“With today’s guilty verdict, Asainov now faces the possibility of spending the rest of his life in prison for providing material support to ISIS which resulted in death.  Combatting terrorism worldwide remains the FBI’s top priority, and the dedicated personnel assigned to our New York Joint Terrorism Task force will continue to work tirelessly to bring to justice all those who seek to commit acts of terror against the United States and our citizens,” stated FBI Assistant Director-in-Charge Driscoll.   

“Asainov is a naturalized U.S. citizen who forsook the country that took him in – as well as his family in New York City – to instead pledge allegiance to ISIS and actively promote that terrorist group’s violent objectives,” stated NYPD Commissioner Keechant L. Sewell. “Today’s verdict serves as a warning to anyone who intends to support or conduct attacks on behalf of such a despicable organization: You will be brought to justice. The threat of ISIS-inspired murder and chaos remains very real, however, and the members of our FBI-NYPD Joint Terrorism Task Force – in close partnership with our law enforcement colleagues across the globe – will never cease working to identify those who so clearly consider our country their sworn enemy.”

As proven at trial, between December 2013 and March 2019, Asainov provided and conspired to provide material support and resources in the form of personnel, including himself, training, and expert advice and assistance, to a foreign terrorist organization, namely ISIS, knowing that ISIS was a designated foreign terrorist organization that had engaged in terrorist activity and terrorism.  Asainov also received military-type training from ISIS, in violation of federal law.

Asainov converted to Islam in 2009 and subsequently became increasingly interested in Islamic extremism.  By the fall of 2013, he was consuming radical Islamic content online.  He abruptly dropped out of classes at the Borough of Manhattan Community College in September 2013, and began preparing to travel to Syria to wage violent jihad.

On December 24, 2013, Asainov abandoned his wife and daughter in Brooklyn, and traveled on a one-way ticket from New York to Istanbul, Turkey, to obtain entry into Syria.    

Over the course of approximately five years fighting on behalf of ISIS, Asainov fought in numerous battles against ISIS enemies, including engagements at Kobani; Tabqa; Raqqa; Dayr Az Zawr; and ISIS’s last stand in Syria at Baghouz, in March 2019.  Asainov received training in how to use automatic rifles, machine guns and rocket-propelled grenades.  In Tabqa, in mid-2014, he volunteered to train as a sniper.  Over time, Asainov became a sniper trainer or “emir” on behalf of ISIS, estimating that he taught nearly 100 students.  A former U.S. Navy SEAL scout sniper testified that the defendant’s sniper training course was consistent with what the former SEAL would expect to be taught in a sniper training program.

From Syria, the defendant attempted to recruit another individual to travel from the United States to Syria to fight for ISIS, and sought to obtain funds to purchase a scope for his rifle from the same person.  The defendant also told his estranged wife that he was fighting on behalf of ISIS, described by him in a recorded January 2015 voicemail as “the most atrocious terrorist organization in the world that ever existed.”  Asainov’s wife testified that he sent her a photograph of three dead fighters, one of whom was wearing a patch that stated, “Islamic State of Iraq and al-Sham,” i.e., ISIS, in Arabic script.

Asainov was captured in Syria after ISIS’s last stand at Baghouz, near the Syria-Iraq border.  Just before his capture, Asainov discarded his rifle and destroyed his cell phone.

Asainov admitted to agents from the FBI’s Joint Terrorism Task Force that he had fought in numerous battles on behalf of ISIS as a warrior and sniper, serving in several different katibas or ISIS fighting brigades.  In recorded phone calls to his mother from facilities operated by the Bureau of Prisons, the defendant told her that he was carrying out Allah’s orders when he waged jihad and killed for ISIS, that he intended to return to waging jihad if released, and that he would fight until he “meet[s] Allah,” i.e., until his death.  In September 2020, staff at a BOP facility confiscated a makeshift ISIS flag affixed to Asainov’s cell wall. The defendant had filled in an 8.5” x 11” sheet of paper with black ink and Arabic writing in the design of the ISIS flag.

The government’s case is being handled by the Office’s National Security and Cybercrime Section.  Assistant United States Attorneys Douglas M. Pravda, J. Matthew Haggans, Nicholas J. Moscow, and Nina C. Gupta are in charge of the prosecution, with assistance provided by Assistant United States Attorney Saritha Komatireddy, Trial Attorney Jenny Levy of the Counterterrorism Section of the National Security Division of the Department of Justice and Paralegal Specialists Wayne Colon and Mary Clare McMahon.

The Justice Department’s Office of International Affairs, the FBI’s Legal Attachés abroad, and foreign authorities in multiple countries on multiple continents provided critical assistance in this case. The Bosnian and Herzegovinian authorities, and the FBI Legal Attaché Office in Sarajevo provided extraordinary assistance in the investigation and prosecution. The Ministry of Justice for the Republic of Finland, the Stuttgart Police Department and Federal Office of Justice in the Federal Republic of Germany, the Department of Justice & Constitutional Development in the Republic of South Africa, and the Prosecutor General’s Office in Ukraine, and the FBI’s Legal Attaché Offices in or responsible for those countries provided valuable assistance in the investigation.

The Defendant:

RUSLAN MARATOVICH ASAINOV (also known as “Suleiman Al-Amriki” and “Suleiman Al-Kazakhi)
Age:  46
Syria and Bay Ridge, Brooklyn

E.D.N.Y. Docket No. 19-CR-402 (NGG)

Gonzalo Ortiz was sentenced yesterday in federal court in Brooklyn by United States District Judge William F. Kuntz II, to 30 months in prison for defrauding an investor of nearly $600,000 by making false representations about Ortiz’s trading expertise and the profitability of various investments.  The Court also ordered Ortiz to pay $224,500 in restitution to the victim and imposed two years of supervised release to follow his custodial sentence.  In November 2021, Ortiz pleaded guilty to one count of investment advisor fraud.

Breon Peace, United States Attorney for the Eastern District of New York, announced the sentence.

Mr. Peace expressed his appreciation to the Federal Bureau of Investigation, New York Field Office, and the United States Securities and Exchange Commission, New York Regional Office, for their significant cooperation and assistance in this case.

Between approximately April 2015 and May 2017, Ortiz falsely represented himself to an investor (the “Victim”) as a successful investment adviser who had made profits for other individuals by trading stocks on their behalf.  Ortiz convinced the Victim to allow him to invest the Victim’s money, promising significant returns.  Based on those misrepresentations, the Victim made successive investments with Ortiz over a period of years.  During this time, Ortiz falsely told the Victim that the investments were profitable and sent the Victim a false account statement to support these claims.  In reality, Ortiz made poor trading decisions that resulted in the loss of a portion of the Victim’s money, and also stole some of the Victim’s money for himself, siphoning off portions of the investments to pay for personal expenses, including clothing, food and car payments.  Ortiz controlled nearly $600,000 of the Victim’s money, stole approximately $224,500 for himself, and lost a significant amount of the Victim’s money to unprofitable trades.

The case is being handled by the Office’s Business and Securities Fraud Section.  Assistant United States Attorneys Alixandra Smith and Andrew D. Grubin are in charge of the prosecution.

The Defendant:

Gonzalo Ortiz
Age: 49
Hackensack, New Jersey

E.D.N.Y. Docket No. 19-CR-161 (WFK)

Angel Almeida will be arraigned this afternoon at the federal courthouse in Brooklyn on a superseding indictment charging him with the sexual exploitation and attempted exploitation of a minor, coercion and enticement and attempted coercion and enticement of a minor, possession of child pornography, and possessing a firearm and ammunition as a felon.  Almeida was arrested in November 2021 on a complaint charging him with being a convicted felon in possession of a firearm.  He was indicted in December 2021 and has been detained pending trial.  Today’s arraignment will be held before United States District Judge Rachel P. Kovner.  

Breon Peace, United States Attorney for the Eastern District of New York, and Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the superseding indictment.

“The defendant’s alleged exploitation of minors has been extremely harmful mentally, emotionally and physically to his victims,” stated United States Attorney Peace.  “His possession of a firearm despite a prior felony conviction, combined with his crimes against minors, reflect Almeida’s dangerousness and lack of respect for the law.  Protecting the community from predators like the defendant will always be a priority of this Office.  Additionally, I urge parents and caregivers to have conversations with their children about the dangers of communicating online with strangers and individuals who seek to exploit them.” 

“As alleged, Almeida posed multiple threats to our community, not only as a felon in possession of a firearm, but also through targeting children as victims of sexual abuse.  Today’s indictment serves as a reminder the FBI and our law enforcement partners will continue to aggressively pursue and hold accountable anyone willing to exploit some of the most vulnerable members of our society.  We ask anyone who may have been victimized by Almeida to contact us at 1-800-CALL-FBI or online at tips.fbi.gov,” stated FBI Assistant Director-in-Charge Driscoll.

As set forth in court filings, in September 2021 and October 2021, the FBI received tips regarding an individual named Angel Almeida possessing firearms and posting sexually explicit images of children online.  The tipster identified social media profiles used by Almeida, including a Facebook account with the profile name “Sargent Grey” (the “Sargent Account”).  A review of the Sargent Account, as well as Instagram accounts used by Almeida, revealed photos of Almeida holding what appeared to be firearms.  On November 23, 2021, members of law enforcement executed a search warrant at Almeida’s residence and recovered a 9 mm Taurus handgun that appeared to be the same firearm that the defendant had posed with.  Almeida has a 2019 felony conviction in Florida for burglary.   As a result, in December 2021, Almeida was charged in an indictment with being a felon in possession of a firearm.

In addition, between July 2021 and December 2021, Almeida enticed a minor, Jane Doe-1, to engage in sexually explicit conduct for the purpose of producing videos.  Between February 2020 and November 2021, Almeida also enticed another minor, Jane Doe-2, to engage in sexual contact, a violation of the Mann Act.  In addition to the enticement and coercion charges, Almeida is also charged with possession of child pornography recovered from multiple cell phones.  

The government’s investigation is ongoing.  Anyone with information about sexual exploitation by Almeida is asked to contact the FBI at 1-800-CALL-FBI or online at tips.fbi.gov

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

If convicted of the charges, Almeida faces a mandatory minimum of 15 years’ imprisonment and up to life in prison.

The government’s case is being prosecuted by Assistant United States Attorney Chand Edwards-Balfour. 

The Defendant:

ANGEL ALMEIDA
Age:  22
Queens, New York

E.D.N.Y. Docket No. 21-CR-613 (RPK)

Earlier today, a federal jury in Brooklyn convicted Quandel Smothers on both counts of an indictment charging him with racketeering conspiracy and possessing a firearm in furtherance of a drug trafficking crime in connection with his leadership of the East New York-based Elite Assassin Millas (E.A.M.), a set of the Bloods street gang.  Six other members and associates of E.A.M. previously pleaded guilty after being charged in June 2020.  When sentenced, the defendant faces a maximum of life in prison and a mandatory minimum sentence of five years. 

Breon Peace, United States Attorney for the Eastern District of New York, announced the verdict.

“Today’s verdict is welcome news to the people of East New York, who will no longer have to face the defendant’s destructive impact on their neighborhood,” stated United States Attorney Peace.  “Our communities should not have to live in fear of unprompted violence from the defendant and his gang.”

Mr. Peace thanked the Federal Bureau of Investigation, New York Field Office and the New York City Police Department for their assistance in the case.

As proven at trial, E.A.M. operated primarily in East New York, which the gang referred to as “Gun Town.”  The gang profited through fraud and narcotics dealing, particularly the sale of crack cocaine and marijuana. 

Between 2006 and 2019, Smothers agreed with other gang members and associates to engage in fraud, narcotics trafficking, and significant acts of violence, including shootings that killed at least one individual and left several other victims permanently disabled. 

On April 30, 2011, the defendant shot a fellow E.A.M. member whom he believed intended to harm another member of the gang over a drug-related dispute.  As a result of the shooting, the victim’s leg was amputated.  Over the years that the defendant led the gang, the gang engaged in numerous feuds with other local street gangs in East New York that frequently resulted in shoot-outs between the groups.  As a result of shootings, several individuals were paralyzed by members of E.A.M., and one person — Michael Tenorio — was murdered.

The other defendants charged in the indictment previously pleaded guilty to crimes including murder, conspiracy to commit murder, assault, and interstate stalking causing life threatening injury.

This case is being prosecuted as part of the joint federal, state, and local Project Safe Neighborhoods (PSN) Program, the centerpiece of the Department of Justice’s violent crime reduction efforts.  PSN is an evidence-based program proven to be effective at reducing violent crime.  Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them.  As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.

The government’s case is being handled by the Office’s Organized Crime and Gangs Section.  Assistant United States Attorneys Matthew Galeotti, Genny Ngai and Jonathan Siegel are in charge of the prosecution with the assistance of paralegal Brittany Wissel.

The Defendant:

QUANDEL SMOTHERS (also known as “Chucky”)
Age: 32
Brooklyn, New York

Defendants Who Previously Pleaded Guilty

TYSHAWN CORBETT (also known as “Reck”)
Age: 32
Brooklyn, New York

QAWON ALLEN (also known as “40” and “Phorty Wap”)
Age: 28
Brooklyn, New York

DESMONN BECKETT (also known as “Des”)
Age: 30
Brooklyn, New York

DEVON BRISTOL (also known as “D”)
Age: 32
Brooklyn, New York

MARLON BRISTOL (also known as “Marlo”)
Age: 35
Brooklyn, New York

ANDREW CAMPBELL (also known as “Phaze”)
Age: 27
Brooklyn, New York

E.D.N.Y. Docket No. 20-CR-213 (KAM)

BROOKLYN, NY – Earlier today, in federal court in Brooklyn, John DeMarr was sentenced by United States District Judge LaShann DeArcy Hall to 60 months in prison for his participation in a cryptocurrency and securities fraud scheme.  The Court also ordered DeMarr to pay $3,513,305.41 in forfeiture.  In July 2021, DeMarr pleaded guilty to one count of conspiracy to commit securities fraud.

Breon Peace, United States Attorney for the Eastern District of New York, Kenneth A. Polite Jr., Assistant Attorney General of the Justice Department’s Criminal Division, Donald Alway, Assistant Director-in-Charge, Federal Bureau of Investigation, Los Angeles Field Office (FBI), and Tyler Hatcher, Special Agent-in-Charge, Internal Revenue Service Criminal Investigation, Los Angeles (IRS-CI), announced the sentence.

“DeMarr took advantage of those who trusted him, persuading them to double down on their investments when he knew that his cryptocurrency companies and their dubious celebrity endorsements were scams being used to fund his lavish lifestyle,” stated United States Attorney Peace.  “The victims ultimately lost everything, so it is appropriate that DeMarr lose his freedom for concocting this fraud.”

“Cryptocurrency schemes are on the rise. The Internal Revenue Service Criminal Investigation and our law enforcement partners are working diligently to identify and investigate criminals who perpetrate these schemes, like John DeMarr,” stated IRS-CI Special Agent-in-Charge Hatcher.  “DeMarr, a promoter of several digital asset-related companies, conspired with others to defraud victims and made misleading representations for significant profits. DeMarr diverted funds into accounts he controlled and spent the money to maintain a lavish lifestyle. Those who line their pockets with profits from these schemes should know they will not go undetected and will be held accountable.”

According to court filings, DeMarr, a promoter of several digital asset-related companies, conspired with others to defraud investor victims by inducing them to invest in their companies, “Start Options” and “B2G,” based on materially false and misleading representations. Start Options purported to be an online investment platform that provided cryptocurrency mining, trading, and digital asset trading services. B2G was purportedly an “ecosystem” that would allow users to trade B2G tokens, provide digital wallet staking, and trade digital and fiat currencies “on a secure, comprehensive platform.” Both Start Options and B2G, however, were fraudulent. 

DeMarr and others falsely claimed that investor funds would be invested in digital asset mining and trading platforms that would earn them massive profits. In reality, the funds were never invested and instead diverted to accounts controlled by DeMarr and others and used for various personal expenditures, including the purchase of a Porsche, jewelry, and the remodeling of DeMarr’s home in California. 

Start Options also purported to feature celebrity endorsements to promote its securities offerings. For example, a professional athlete purportedly endorsed Start Options and his name and likeness were used without his consent. Based on this and other fraudulent promotional materials, investors sent millions of dollars’ worth of Bitcoin, Ethereum, and fiat currency to financial accounts, including cryptowallets, controlled by DeMarr and others in the United States and abroad. In late January 2018, rather than permitting Start Options investors to withdraw money from their accounts after the requisite time period, DeMarr and others required investors to roll over their accounts into an unregistered “initial coin offering,” or ICO, of B2G. Investors never actually received any digital tokens, and funds from the offering were not used to develop the B2G platform.

Additionally, DeMarr and others also paid various promoters, including an actor famous for martial arts films made in the 1980s and 1990s, to serve as a promoter and celebrity spokesperson, falsely claiming that B2G could generate an “8,000%” return for investors within one year, and that he was a participant in the ICO. DeMarr and others also created false press releases and whitepapers about B2G, fabricated B2G account statements, and refused to allow investors to withdraw their money. 

This case was investigated by the FBI and IRS-CI. Assistant U.S. Attorneys Kaitlin T. Farrell, Hiral D. Mehta, David C. Pitluck, Antoinette N. Rangel and Special Agent Martin Sullivan of the Eastern District of New York and Trial Attorney Kevin Lowell of the Criminal Division’s Fraud Section are prosecuting the case. Assistant United States Attorney Claire Kedeshian of the Office’s Asset Recovery Section is handling forfeiture matters.

The Defendant:

JOHN DEMARR
Age:  58
Santa Ana, California

E.D.N.Y. Docket No. 21-CR-153 (LDH)

On January 19, 2023, the United States filed a civil complaint in federal court in Brooklyn against two firearm companies, and two individuals associated with these companies (collectively, “Defendants”), alleging that Defendants have conspired to defraud the United States and consumers, and have engaged in the ongoing commission of mail fraud and wire fraud, by unlawfully selling machine gun conversion devices.  The devices, called FRT-15s, are specifically designed and intended to be used to convert AR-15 type rifles into machineguns and are therefore themselves “machineguns” under federal law.  With limited exceptions not applicable to Defendants’ conduct, the manufacture, sale and possession of machine guns is illegal under the National Firearms Act and the Gun Control Act of 1968.  The Government’s complaint seeks injunctive relief under the Anti-Fraud Injunction Act.  The United States also sought a temporary order immediately halting any sales of the FRT-15 or any forced reset trigger until and unless otherwise ordered by the Court.  On January 25, 2023, United States District Judge Nina R. Morrison entered a temporary restraining order against Defendants.

Merrick B. Garland, United States Attorney General; Breon Peace, United States Attorney for the Eastern District of New York; Steven Dettelbach, Director, U.S. Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF); and John B. DeVito, Special Agent-in-Charge, ATF, New York Field Division, announced the filing of the complaint.

“The Justice Department has filed a complaint against two firearm companies and two individuals who we allege are illegally selling machineguns, conspiring to violate federal firearm laws, and committing mail and wire fraud” said Attorney General Merrick B. Garland. “Today, we obtained a temporary restraining order that immediately stops the defendants from illegally selling their machineguns.  The Justice Department will continue to do everything in its power to protect the American people from gun violence and to hold accountable those that flood our communities with illegal guns.”

“The defendants are illegally selling machine guns, plain and simple, with conversion devices that transform AR-15 type rifles into even more lethal weapons suited for battlefields, not our communities,” said United States Attorney Peace.  “We will continue to work with our law enforcement partners to stop the flow of illegal and deadly weapons onto our streets.  The United States will be relentless in employing every means available, including all civil tools, to end violence in New York and across the nation.”

ATF Director Dettelbach stated: “Decades ago, Congress determined that machine guns are illegal, yet, despite repeated warnings, the defendants in this case are alleged to be flouting the law. Machine guns are unlawful because they pose a threat to the public and they are increasingly a risk to law enforcement. Ensuring that individuals and companies comply with the prohibition on selling machine guns is just one of many steps ATF is taking to address violent crime and protect our communities.”

“These machine gun conversion devices—which are machine guns under federal law—can turn any semi-automatic AR-type firearm into a weapon capable of shooting at a rate of fire similar to or exceeding that of an M16 machine gun manufactured for military use.  Since 1934, machineguns have been subject to strict federal controls, and since 1986, machineguns have been subject to an outright prohibition. These defendants are believed to have earned millions at the expense of the public’s safety and are alleged to have conspired to undermine these very federal laws which are intended to keep the public safe.  I would like to thank the United States Attorney’s Office and ATF personnel for their hard work and commitment in securing the temporary restraining order,” stated ATF Special Agent-in-Charge DeVito.

Defendants are Rare Breed Triggers, LLC and Rare Breed Firearms, LLC (collectively, “RBT”) and their owner/operators Lawrence DeMonico, also known as “Larry R. Lee, Jr.” and Kevin Maxwell.  As alleged in the complaint, Defendants have unlawfully sold thousands of FRT-15s to the general public.  In the process, Defendants have sought to obstruct ATF’s mandate to enforce laws prohibiting the sale of machine guns and ensure public safety.  Defendants have also allegedly misled consumers about the legality of FRT-15s.  

As set forth in the January 25, 2023 temporary restraining order (“TRO”), among other things, the Court found that “[t]here is probable cause to believe that Defendants’ fraudulent conduct is ongoing and imminent,”  that “Defendants failed to register FRT-15s for the purpose of concealing from ATF the sale and transfer of these items,” and that the TRO is necessary to prevent “a continuing and substantial injury to the United States, as well as to past and future purchasers of FRT-15s who have been or may be misled into believing that their possession of FRT-15s is lawful when it is not.”

This action is part of the U.S. Attorney’s Office for the Eastern District of New York’s Civil Initiative to Reduce Gun Violence.  The EDNY’s Civil Initiative to Reduce Gun Violence was created in 2022.  The EDNY’s Civil Initiative to Reduce Gun Violence aims to work with federal, state, and local officials, as well as community stakeholders, to address the root causes of gun-related crime, and supports reform efforts made across the government.  The EDNY’s Civil Initiative to Reduce Gun Violence complements the EDNY Criminal Division’s prosecution of gun-related crimes.  The Office also works collaboratively on the Initiative with the Consumer Protection Branch of the Department of Justice.

The government’s case is being handled by Assistant U.S. Attorneys Michael Blume, Joseph Marutollo and Paulina Stamatelos of the Office’s Civil Division with assistance from ATF’s Deputy Associate Chief Counsel Matthew Myerson.

E.D.N.Y. Civil Docket No.:  23-CV-369 (NM) (RML)

Remarks as Delivered:

“Good morning.  My name is Breon Peace and I am the United States Attorney here in the Eastern District of New York, which covers Brooklyn, Queens, Staten Island and all of Long Island and is home to more than 8 million people.  Welcome! 

It is my honor to speak to you all today, a day that you will surely treasure for the rest of your lives.  Let me be among the first to congratulate you on this wonderful milestone!  I am proud to be united with you today in a bond of citizenship that transcends all racial, religious, ethnic, cultural, gender-based, political, language and economic boundaries and proud that we have found a common purpose in being called American citizens.

As the United States Attorney, I have the privilege of leading an office that is responsible for prosecuting all federal criminal cases and for handling federal civil cases in this vast district in which you live.  So my job is to keep the community safe and enforce the law on behalf of the United States to improve the lives of the people of the district, particularly our most vulnerable residents.

One of the best parts of my job is being able to work on behalf of and interact with the citizens of this great district—a district that was created in 1865 by President Abraham Lincoln.  This district has a long and storied history, but to me, it is perhaps best characterized by its rich and vibrant diversity.  This diversity is exemplified by the people in this room.  People born on continents around the globe.  People of different races and religions, ethnicities and educations.  People from widely disparate walks of life. 

With all of these differences, how does America come together?  To me, the answer is clear.  We, as Americans, are united by the philosophy that all people are created equal, and with a goal to make this country better, a more perfect union.

You should have received a packet that contains the Declaration of Independence and the United States Constitution.  These documents speak to the origin of American citizenship and the country’s founding principles in establishing its democratic form of government.

The Declaration of Independence states that all men are created equal.  But at the time it was drafted in 1776, neither the Declaration of Independence nor the later drafted United States Constitution recognized all people as equal.  These documents, despite their central role in structuring a government of, by and for the people, did not contemplate that I, a black man and descendant of slaves, would one day be responsible for: protecting the 8.5 million residents of this district from crime; promoting civil rights, justice and equality for all; and safeguarding the very ideals of democracy and the rule of law enshrined in these documents.   

Yet, we are together today as U.S. citizens.  How did we move from the exclusion of the past to the welcoming inclusion reflected in the present moment?

History teaches that it took generations, as well as strength, determination and sustained, unyielding courage to ensure that the nation’s promise of equality was extended to all of its people.

A week and a half ago as we do every January, we honored Dr. Martin Luther King, Jr.  We commemorate the day of Dr. King’s birth and his legacy with a day of service in our communities, in recognition of his unshakeable faith and unrelenting quest for human dignity and civil rights. 

On August 28, 1963, Dr. King stood before the largest crowd ever gathered in support of civil rights at the Lincoln Memorial and boldly talked about his dream in the iconic “I Have A Dream” speech.  Sixty years ago, he dreamed of today, where we sit shoulder-to-shoulder basking in the joy and excitement of being citizens from all walks of life, blending cultures, religions, races and gender in celebration of the promise, hope, and yes, future of democracy.  In an Independence Day sermon he delivered on July 4, 1965, Dr. King spoke poignantly of this dream, saying “... America is essentially a dream.  It is a dream of a land where men of all races, of all nationalities, and of all creeds, can live together as brothers.  The substance of the dream is expressed in these sublime words, ‘we hold these truths to be self-evident that all men are created equal, that they are endowed by their creator with certain inalienable rights, that among these are life, liberty and the pursuit of happiness.’”  With your sworn oath this morning, these timeless words now belong to you.

In the fight for civil rights, Dr. King identified the precursor to the American dream as the Emancipation Proclamation, which he referred to as the “offspring” of the Declaration of Independence.  Although I do not intend to give a history lesson here, President Abraham Lincoln issued the Emancipation Proclamation in 1863 to end the Civil War and unify the nation.  Dr. King wrote eloquently that the Emancipation Proclamation, “resurrected and restated the principle of equality upon which the founding of the nation rested.” 

It could not be more fitting for us to join in pledging our allegiance to this great country in a proud district created by President Lincoln and rooted in his proclamation of freedom. 

I will close with this:  Dr. King, former Presidents John F. Kennedy and Barack Obama, often spoke of audacity and hope; the audacity to believe that each of us can make this country greater and stronger, and hope for a better and brighter tomorrow for all Americans. 

I share the audacity and hope, and trust that you do too.  In my life and career as a lawyer, and as United States Attorney today, I’ve had the audacity to believe that I could bend the “arc of the moral universe” towards justice, fairness and freedom, especially for the vulnerable and the marginalized.  And that I can, “keep making our streets safer and our criminal justice system fairer – our homeland more secure, our world more peaceful and sustainable for the next generation,” as President Obama once implored.

I urge you to make today your day of audacity, your day to use the voice you’ve been given to further our democracy and give meaning to its founding principles.  Each of you, have journeyed to this country, you have joined this country, you have judged its ideals your ideals.  You have elected to become citizens in a land of opportunity and dreams as proud heirs of the Declaration of Independence.  Hold fast to the belief that all men and women are created equal and pay it forward by bending the moral arc of this district and country towards justice, fairness, equity and inclusion.  Never forget what brought you here and made you Americans. 

I congratulate you once again on your becoming American citizens and welcome each and every one of you to share in our vibrant democracy.”

Alexander Almaraz, the owner of Design Concepts Group LLC (DCG) in Freeport, New York, has been charged in a 20-count indictment with wire fraud conspiracy, wire fraud, and attempted wire fraud in connection with a scheme to induce individuals to hire the defendant and pay DCG to lift their Hurricane Sandy-damaged homes.  Almaraz is scheduled to be arraigned tomorrow afternoon in federal court in Central Islip before United States Magistrate Judge Lee G. Dunst.

Breon Peace, United States Attorney for the Eastern District of New York, Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Anne T. Donnelly, Nassau County District Attorney, announced the arrest and charges.

“In the aftermath of Hurricane Sandy, the defendant took advantage of distressed homeowners who were desperate to rebuild their homes and their lives,” stated United States Attorney Peace.  “The criminal charges announced today demonstrate that despite the passage of time, this Office and our law enforcement partners will prosecute fraudsters who prey on disaster victims and use government relief programs as a piggy bank to enrich themselves.”

Mr. Peace also thanked New York Rising (NYR) within the Governor’s Office of Storm Recovery for their assistance with the investigation.

“As our fellow community members attempted to restore their lives following the cataclysmic destruction of Hurricane Sandy, the defendant exploited the opportunity to operate a years’ long scheme.  As alleged, rather than complete the promised contract, Almaraz stole his victims' money to pay for his lavish personal expenses.  The FBI will continue to investigate fraud and abuse of government relief programs and hold the scammers accountable for their schemes,” stated FBI Assistant Director-in-Charge Driscoll.

District Attorney Donnelly said: “Dozens of New Yorkers – in their hour of need – were left homeless, and with their homes in ruin, due to the alleged actions of Alexander Almaraz. For nearly four years, this contractor allegedly promised families that he’d repair their homes, but instead he used disaster relief money to buy exotic sports cars and property in another state. I thank our partners at the US. Attorney’s Office and the FBI for their diligent pursuit of this defendant, who has left a trail of destruction in his wake.”

On October 29, 2012, Hurricane Sandy struck New York and New Jersey, causing catastrophic damage to low-lying and coastal areas, including many neighborhoods in the Eastern District of New York.  Individuals whose homes were damaged were eligible to receive funding from the Governor’s Office of Storm Recovery through the NYR program.

As alleged in the indictment, Almaraz entered into contracts—alternatively as the owner of DCG and fraudulently posing as the owner of a different company—with homeowners who qualified to receive funds from NYR.  As part of these contracts, Almaraz agreed to lift the victims’ homes and set them down on a temporary support structure, which allowed demolition of the foundation, and then install a new foundation, lower the home, and reconnect appliances.  Between October 2015 and June 2019, Almaraz agreed to lift the homes of at least 20 customers that had received NYR funding and who collectively paid him approximately $2.5 million.  Almaraz convinced many of these homeowners to move out of their homes and pay him rent to live elsewhere, all the while neglecting their projects and causing greater loss.  Additionally, instead of performing the agreed-upon work, Almaraz used the homeowners’ monies to pay for personal expenses, including credit card bills, land purchased in Kansas City, Missouri, and luxury automobiles, including a Lamborghini, a Porsche and a Jaguar.  If convicted, the defendant faces a maximum term of 30 years’ incarceration on each count in the indictment.  

The charges in the indictment are allegations, and Almaraz is presumed innocent unless and until proven guilty.

The government’s case is being handled by the Office’s Long Island Criminal Division.  Assistant United States Attorneys Christopher Caffarone and Megan E. Farrell are in charge of the prosecution. 

The Defendant:

ALEXANDER ALMARAZ
Age: 55
Irvine, California – formerly of Freeport, New York

E.D.N.Y. Docket No. 23-CR-17 (JMA)

Dairo Antonio Úsuga David, known by various aliases, including “Otoniel,” pleaded guilty today to running a continuing criminal enterprise—the Colombian paramilitary and multibillion dollar drug organization known as the “Clan del Golfo” (CDG).  Úsuga David also pleaded guilty to related drug distribution charges.  When sentenced, Úsuga David will face a mandatory minimum term of 20 years in prison and up to life in prison.  As part of the plea agreement, Úsuga David also agreed to pay a $216 million forfeiture money judgment.  The proceeding was held before United States District Judge Dora L. Irizarry.

Úsuga David was charged by way of indictments filed in the Eastern District of New York, United States v. Dairo Antonio Usuga David, et al., 14-CR-625 (S-4) (E.D.N.Y.) (the “EDNY Indictment”), in the Southern District of Florida, United States v. Dairo Antonio Usuga David, 15-CR-20403 (S-1) (the “SDFL Indictment”), and in the Southern District of New York, United States v. Dairo Antonio Usuga David, 04-CR-962 (S-3) (the “SDNY Indictment”) (collectively the “Indictments”). 

The EDNY Indictment charged Úsuga David with, among other things, engaging in a continuing criminal enterprise from June 2003 through October 2021.  The SDFL Indictment charged Úsuga David with, among other things, maritime narcotics distribution conspiracy from 2002 through October 23, 2021.  The SDNY Indictment charged Úsuga David with, among other things, narcotics importation conspiracy from 2001 through April 2009.  Úsuga David was extradited from Colombia to the Eastern District of New York in May 2022. 

Pursuant to a plea agreement, Úsuga David agreed to the transfer of the SDFL Indictment and the SDNY Indictment for plea and sentencing in the Eastern District of New York.  Thus, Úsuga David will be held accountable in the Eastern District of New York for the criminal conduct encompassing the three Indictments.

Merrick B. Garland, United States Attorney General; Breon Peace, United States Attorney for the Eastern District of New York; Markenzy Lapointe, United States Attorney for the Southern District of Florida; Damian Williams, United States Attorney for the Southern District of New York; Anne Milgram, Administrator, U.S. Drug Enforcement Administration (DEA); Ivan Arvelo, Special Agent-in-Charge, Homeland Security Investigations, New York (HSI); Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI); Keechant L. Sewell, Commissioner, New York City Police Department (NYPD); and Steven A. Nigrelli, Acting Superintendent, New York State Police (NYSP), announced the guilty pleas.

“With today’s guilty plea, the bloody reign of the most violent and significant Colombian narcotics trafficker since Pablo Escobar is over.  Úsuga David has now been held accountable for his leadership of the Clan del Golfo, which was responsible for trafficking tons of illegal narcotics from Colombia to the United States and incalculable acts of violence against law enforcement, military personnel, and civilians in Colombia and elsewhere,” stated United States Attorney Peace.  “Today’s guilty plea is the result of the determined work of numerous law enforcement personnel in the United States, Colombia, and elsewhere.  It is our hope that bringing Úsuga David to justice can provide a measure of solace to the victims of his narcotics trafficking and violence in Colombia and the United States.”

Mr. Peace extended his appreciation to the United States Attorneys’ Offices for the Middle District of Florida and Eastern District of Texas; the Justice Department’s Office of International Affairs; the Justice Department Criminal Division’s Narcotic and Dangerous Drug Section (NDDS); Judicial Attachés in Bogotá, Colombia; NDDS SOD Trial Attorneys; the United States Marshals Service; the Port Authority Police Department; the President of Colombia; the Colombian Attorney General’s Office; the Colombian National Police; the Colombian Ministry of National Defense; the Colombian Ministry of Justice; and the Colombian Ministry of Foreign Affairs, for assistance in the investigation, arrest, and extradition of the defendant.

“The guilty plea of alias Otoniel is the result of exemplary international cooperation,” said U.S. Attorney for the Southern District of Florida Markenzy Lapointe. “It also signifies years of hard work, commitment and perseverance of our Colombian and U.S. law enforcement partners to stem the flow of cocaine into the United States and to bring a major international drug trafficker to justice.”

“Today’s guilty plea sends a clear message to the leaders of drug cartels around the world that the DEA will stop at nothing to investigate and dismantle criminal drug networks that threaten the safety and health of the American people,” said Administrator Anne Milgram. “DEA investigated Otoniel—one of the most violent and prolific drug traffickers in the world—for almost 20 years. Under Otoniel’s leadership, Clan del Golfo shipped massive quantities of cocaine into the United States and killed rivals that threatened the cartels’ trafficking operations. I commend the men and women of the DEA for their many years of outstanding work that culminated in today’s guilty plea.”

“Today’s guilty plea ends Dairo Antonio Usuga David’s nearly 20-year reign of terror as a member and eventual leader of the notorious drug trafficking organization Clan del Golfo – an organization whose violent criminal activities pose a major strategic drug and national security threat to both the United States and Colombia,” said Ivan J. Arvelo, Special Agent in Charge for Homeland Security Investigations (HSI) in New York. “HSI will not stand by while narco-terrorists peddle poison around the globe for their own selfish financial gains. We will continue to work with our domestic and international law enforcement partners to disrupt and dismantle these dangerous transnational criminal enterprises and bring the perpetrators to justice.”

As today's plea details, Usaga David admitted to leading a savage and violent cartel responsible for trafficking enormous amounts of illegal narcotics to the United States.  The FBI along with our law enforcement partners are dedicated in our efforts to make sure ruthless actors like Usaga David are held accountable for their destructive actions in our criminal justice system,” stated Assistant Director-in-Charge Driscoll.

“Today’s guilty plea further affirms the New York City Police Department’s unwavering commitment to ridding our streets of illegal narcotics,” stated NYPD Commissioner Keechant L. Sewell. “Because we know this vital work is far from over, we will continue to stand united with our local, state, federal, and international law enforcement partners in the fight against violent drug traffickers, wherever they are based. To that end, I thank and commend the New York State Police, the FBI, the DEA, Homeland Security Investigations, the U.S. Attorney for the Eastern District, and every other detective, agent, and attorney involved in this important case.”

New York State Police Acting Superintendent Steven A. Nigrelli said, “I applaud the remarkable work done by our State Police members and law enforcement partners in this case.  Today’s guilty plea is proof that we will not tolerate those who bring dangerous drug activity into our communities and put the health and safety of others at risk. The State Police will continue to work with our partners to put an end to these violent enterprises to make our state a safer place.”

According to the Indictments, between June 2003 and October 2021, Úsuga David was the leader of a continuing criminal enterprise responsible for exporting multi-ton shipments of cocaine from Colombia to Mexico and Central America for ultimate importation into the United States.  Additionally, Úsuga David participated in conspiracies to distribute narcotics via maritime vessels and also to manufacture and distribute cocaine, knowing and intending that the narcotics would be illegally imported into the United States.

The Clan Del Golfo

Between 2012 and through his capture by Colombian military and law enforcement forces on October 23, 2021, Úsuga David was the leader of the CDG.

The CDG is one of the most violent and most powerful criminal organizations in Colombia, and it is one of the largest distributors of cocaine in the world.  With as many as 6,000 members, the CDG exercises military control over vast amounts of territory in the Urabá region of Antioquia, Colombia, one of the most lucrative drug trafficking areas within Colombia due to its proximity to the Colombia-Panama border and the Caribbean and Pacific coasts.  Clad in military uniforms, CDG members employ military tactics and weapons to reinforce their power and incite wars and violence against rival drug traffickers, paramilitary organizations, and Colombian law enforcement authorities who threaten the CDG’s control.  

The CDG funds its operations primarily through drug trafficking.  It imposes a “tax” on any drug traffickers operating in territory under its control, charging fees for every kilogram of cocaine manufactured, stored, or transported through areas controlled by the organization.  The CDG also directly exports cocaine, and coordinates the production, purchase, and transfer of weekly and bi-weekly multi-ton shipments of cocaine from Colombia into Central America and Mexico for ultimate importation to the United States. 

To maintain control over CDG territory, Úsuga David and the CDG employed an army of “sicarios,” or hitmen, who carried out acts of violence, including murders, assaults, kidnappings, torture, and assassinations against competitors and those deemed traitors to the organization, as well as their family members.  The CDG murdered and assaulted Colombian law enforcement officers, Colombian military personnel, rival drug traffickers and paramilitaries, potential witnesses, and civilians.  Úsuga David and the CDG used violence to promote and enhance the reputation, and position of the CDG with respect to rival criminal organizations; preserve, protect, and expand the CDG’s power and territory; finance the CDG’s operations and enrich its leaders through the collection of drug debts; maintain discipline among its members and associates; and protect CDG members from arrest and prosecution by attempting to silence potential witnesses and retaliating against law enforcement authorities and those assisting law enforcement. 

The Defendant’s Conduct

According to court filings, Úsuga David served as a high-ranking leader within the CDG from its inception and was its principal leader for 10 years.  During his reign, Úsuga David oversaw all of the CDG’s activities and directed its members to engage in extensive criminal acts, including acts of violence, mandated “strikes” or shutdowns of all business activities and civilian movement within designated regions of Colombia, retaliation against law enforcement authorities and potential witnesses, the exertion of control over drug manufacturing facilities and trafficking routes, and the exportation of cocaine in multi-ton quantities.

Úsuga David assumed power and territorial control over vast swaths of the Colombian coastline and personally directed members of the CDG to commit acts of violence to reinforce that power.  This included violence against civilians.  For example, in early 2012, following the death of Úsuga David’s brother, Juan de Dios Úsuga David (also known as “Giovanni”), in a police raid, Úsuga David ordered that a multi-day shutdown or “strike” be imposed on towns and communities within the CDG’s control.  During the strike, CDG members ordered that all businesses remain closed, and that residents stay in their homes.  For multiple days, the streets remained empty, as Úsuga David ordered CDG members to execute those who did not adhere to his orders. 

Úsuga David also personally ordered CDG members to commit murders of specific individuals, including the murders of rival drug traffickers and members of the CDG who betrayed him or the organization.  For example, Úsuga David ordered the assassinations of multiple individuals who worked for a rival drug trafficking organization run by Daniel Barrera Barrera.   Úsuga David also ordered the torture and murder of a CDG member who provided information to Barrera’s organization.  That individual was subsequently tortured, buried alive, exhumed, and beheaded post-mortem.

In addition, Úsuga David regularly directed CDG members to use violence, intimidation, and murder to dissuade law enforcement authorities from performing their duties and to silence potential witnesses.  For example, at Úsuga David’s direction, the CDG carried out organized campaigns, referred to as “Plan Pistolas,” to kill Colombian law enforcement and military personnel using military-grade weapons, including grenades, explosives, and assault rifles.  Úsuga David also offered bounties for the murder of Colombian police officers and military personnel to intimidate law enforcement authorities and prevent them from capturing him or interfering in the CDG’s business.  Úsuga David’s organization made numerous attempts to assassinate individuals who were believed to be cooperating with law enforcement.  For example, CDG members attempted to poison a witness with cyanide while he was imprisoned overseas and attempted to assassinate the witness’s attorney.

Úsuga David was also extensively involved in the narcotics activities that funded the CDG and enabled its power.  He oversaw the CDG’s drug trafficking exports and directed a network of “debt collectors” tasked with the enforcement and collection of taxes paid by drug trafficking organizations that operated in regions controlled by the CDG.   In addition, Úsuga David controlled cocaine manufacturing facilities and used the CDG’s extensive distribution network to export cocaine independently for his own personal profit.

Asset Forfeiture

As part of the plea agreement, Úsuga David agreed to pay a $216 million forfeiture money judgment.  The forfeiture money judgment is subject to the Agreement between the Government of the United States of America and the Government of the Republic of Colombia concerning the Sharing of Forfeited Proceeds and Instrumentalities of Crime.

The investigation, extradition, and conviction of Úsuga David is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles the highest-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten the United States by using a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.

The government’s case is being handled by the Eastern District of New York’s International Narcotics and Money Laundering Section.  Assistant United States Attorneys Francisco J. Navarro, Gillian A. Kassner, and Tara B. McGrath are in charge of the prosecution with assistance from Paralegal Specialist Sophia Cronin, and Assistant United States Attorney Claire S. Kedeshian of the Office’s Asset Recovery Section is handling forfeiture matters. Assistant United States Attorney Robert Emery of the Southern District of Florida and Assistant United States Attorney Alexander Li of the Southern District of New York led the prosecutions for their respective offices.

The Defendant:

Dairo Antonio Úsuga David (also known as “Otoniel,” “Mao,” “Gallo” and “Mauricio-Gallo”)
Age: 51
Antioquia, Colombia

E.D.N.Y. Docket Nos. 14-CR-625 (S-4) (DLI)

                                     23-CR-021 (DLI)

                                     23-CR-027 (DLI)

Dairo Antonio Úsuga David, alias, “Otoniel," quién dirigía una organización paramilitar llegó a ser uno de los mayores traficantes de cocaína del mundo y a ser el responsable de ordenar que se cometieran despiadados actos de violencia contra militares, civiles inocentes y fuerzas del orden público

Dairo Antonio Úsuga David, conocido por sus varios alias, incluyendo el de "Otoniel", se declaró culpable hoy de dirigir una organización delictiva: la organización paramilitar colombiana y multimillonaria conocida como el "Clan del Golfo" (CDG).  Úsuga David también se declaró culpable de narcotráfico.  Durante la imposición de la pena, Úsuga David enfrentará una condena mínima de 20 años de prisión a cadena perpetua.  Como parte del acuerdo logrado con la fiscalía, Úsuga David también aceptó pagar $216 millones por concepto de incautación mediante un fallo judicial. El procedimiento se llevó a cabo ante la Jueza Federal del Distrito, Dora L. Irizarry.

A Úsuga David le fueron formulados cargos por medio de las imputaciones presentadas por el Distrito Este de Nueva York, Estados Unidos c. Dairo Antonio Úsuga David, et al., 14-CR-625 (S-4) (E.D.N.Y.) ("Acusación del EDNY"), el Distrito Sur de Florida, Estados Unidos vs. Dairo Antonio Úsuga David, 15-CR-20403 (S-1) (“acusación del SDFL"), y el Distrito Sur de Nueva York, Estados Unidos vs. Dairo Antonio Úsuga David, 04-CR-962 (S-3) ("acusación del SDNY") (colectivamente las "acusaciones"). 

En la acusación del EDNY se le imputa a Úsuga David, entre otras cosas, de dirigir una organización delictiva desde junio de 2003 hasta octubre de 2021, y una organización delictiva para tráfico de narcóticos por vía marítima desde el 2002 hasta el 23 de octubre del 2021. En la denuncia del SDFL se le acusa a Úsuga David, entre otras cosas, de asociación delictiva para importación de narcóticos desde el 2001 hasta abril del 2009.  Úsuga David fue extraditado de Colombia al Distrito Este de Nueva York en mayo del 2022. 

En virtud de un acuerdo de culpabilidad con la fiscalía, Úsuga David aceptó la transferencia de las denuncias del SDFL y del SDNY para su aceptación de culpabilidad e imposición de pena en la jurisdicción federal del Distrito Este de Nueva York.  Así Úsuga David será responsabilizado en el Distrito Este de Nueva York por delitos cometidos abarcados por las tres denuncias.

Merrick B. Garland, Fiscal General de los Estados Unidos; Breon Peace, Fiscal Federal de los Estados Unidos por el Distrito Este de Nueva York; Marke Holanzy Lapointe, Fiscal Federal de los Estados Unidos por el Distrito Sur de Florida; Damian Williams, Fiscal Federal por el Distrito Sur de Nueva York; Anne Milgram, Directora, Administración para el Control de Drogas de los Estados Unidos (DEA); Iván Arvelo, agente encargado, Investigaciones de Seguridad Nacional, Nueva York (HSI); Michael J. Driscoll, Subdirector a cargo, Oficina Federal de Investigaciones, Oficina de Campo de Nueva York (FBI); Keechant L. Sewell, Comisionado, Departamento de Policía de la Ciudad de Nueva York (NYPD); y Steven A. Nigrelli, Superintendente Interino de la Policía Estatal de Nueva York (NYSP), dieron a conocer dicha declaración de culpabilidad.

“Con su admisión de culpabilidad en el día de hoy, ha llegado a su fin el sangriento reinado del narcotraficante colombiano más violento y señalado desde Pablo Escobar.  Úsuga David ahora ha sido responsabilizado por dirigir el Clan del Golfo, que fue responsable por el tráfico de toneladas de narcótico desde Colombia a Estados Unidos y un sinnúmero de incursiones violentas contra las fuerzas del orden público, personal militar y civiles, tanto en Colombia como en otros lugares", declaró el Fiscal Federal Peace.  “La declaración de culpabilidad de hoy es el resultado de la determinación y esfuerzo de un gran número de elementos del orden público de los Estados Unidos, Colombia y otros lugares.  Esperamos que haber traído a Úsuga David ante la justicia pueda proporcionar una medida de consuelo a las víctimas de su tráfico de narcóticos y violencia en Colombia y Estados Unidos.”

El Sr. Peace extendió su agradecimiento a las oficinas de la fiscalía federal de los Estados Unidos para el Distrito Central de Florida y el Distrito Este de Texas; la Oficina de Asuntos Internacionales del Departamento de Justicia; la Sección de Narcóticos y Drogas Peligrosas (NDDS) de la División Penal del Departamento de Justicia; Agregados Judiciales en Bogotá, Colombia; Abogados litigantes de NDDS SOD; el Servicio de Alguaciles de los Estados Unidos; el Departamento de Policía de la Autoridad Portuaria; el Presidente de Colombia; la Fiscalía General de la Nación; la Policía Nacional de Colombia; el Ministerio de Defensa Nacional de Colombia; el Ministerio de Justicia de Colombia; y al Ministerio de Relaciones Exteriores de Colombia, por su asistencia en la investigación, detención y extradición del acusado.

“La declaración de culpabilidad de alias Otoniel es el resultado de una cooperación internacional ejemplar”, dijo el fiscal federal para el Distrito Sur de Florida, Markenzy Lapointe. “También representa años de arduo trabajo, compromiso y perseverancia de nuestros socios colombianos y estadounidenses de las agencias del orden público para detener el flujo de cocaína hacia los Estados Unidos y llevar a un importante narcotraficante internacional ante la justicia.”

“La admisión de culpabilidad en este día envía un mensaje claro a los líderes de los cárteles de la droga de todo el mundo de que la DEA no se detendrá ante nada para investigar y desmantelar las redes criminales de drogas que amenazan la seguridad y la salud del pueblo estadounidense”, dijo la administradora Anne Milgram. “La DEA investigó a Otoniel, uno de los narcotraficantes más violentos y prolíficos del mundo, durante casi 20 años. Bajo el liderazgo de Otoniel, el Clan del Golfo envió cantidades masivas de cocaína a los Estados Unidos y mató a rivales que amenazaban las operaciones de tráfico de los cárteles. Felicito a los hombres y mujeres de la DEA por sus muchos años de destacada labor que culminó en la declaración de culpabilidad de hoy.”

“La declaración de culpabilidad del día de hoy pone fin al reinado de terror de casi 20 años de Dairo Antonio Úsuga David como miembro y eventual líder de la notoria organización narcotraficante Clan del Golfo, una organización cuyas actividades criminales violentas representan una importante amenaza estratégica relacionadas con drogas y la seguridad nacional tanto para Estados Unidos como para Colombia”, dijo Iván J. Arvelo, Agente Federal a cargo la sección de Investigaciones del Departamento de Seguridad Nacional (HSI) en Nueva York. “HSI no se quedará de brazos cruzados mientras los narcoterroristas venden su veneno en todo el mundo para conseguir ganancias con sus fines egoístas. Continuaremos trabajando con nuestros socios nacionales e internacionales de organismos de seguridad para interrumpir y desmantelar estas peligrosas organizaciones criminales transnacionales y traer a los perpetradores ante la justicia.”

“Como se detalla en la declaración del día de hoy, Úsuga David admitió haber liderado brutal y violento un cártel responsable del tráfico de enormes cantidades de narcóticos a los Estados Unidos.  El FBI, junto con nuestros socios encargados de las fuerzas policiales, estamos comprometidos en nuestro esfuerzo para asegurarnos que actores despiadados como Úsuga David rindan cuentas por sus acciones destructivas ante nuestros tribunales penales”, declaró el subdirector encargado Driscoll.

El superintendente interino de la Policía Estatal de Nueva York, Steven A. Nigrelli, dijo: “Aplaudo el notable trabajo realizado por nuestros miembros de la Policía Estatal y socios encargados de hacer cumplir la ley en este caso.  La declaración de culpabilidad de hoy es una prueba de que no toleraremos a aquellos que traen actividades peligrosas de drogas a nuestras comunidades y ponen en riesgo la salud y la seguridad de los demás. La Policía Estatal continuará trabajando con nuestros socios para poner fin a estas empresas violentas para hacer de nuestro estado un lugar más seguro.”

“Esta declaración de culpabilidad en el día de hoy, afirma aún más el compromiso inquebrantable del Departamento de Policía de la Ciudad de Nueva York de librar a nuestras calles de narcóticos ilegales”, declaró el comisionado del departamento de policía de Nueva York, Keechant L. Sewell. “Debido a que sabemos que esta importante labor está lejos de terminar, continuaremos unidos con nuestros agencias locales, estatales, federales e internacionales encargadas de hacer cumplir la ley en la lucha contra los narcotraficantes violentos, dondequiera que se encuentren. Con ese fin, agradezco y elogio a la Policía del Estado de Nueva York, el FBI, la DEA, al Departamento de Investigaciones de Seguridad Nacional, al Fiscal Federal para el Distrito Este y a todos los demás detectives, agentes y procuradores de justicia involucrados en este importante caso.”

Según se le imputa, entre junio del 2003 y octubre del 2021, Úsuga David fue el líder de una red de delincuencia organizada responsable de exportar cargamentos de varias toneladas de cocaína desde Colombia a México y Centroamérica para su destino final, Estados Unidos.  Además, Úsuga David participó en un sinnúmero de envíos de varias toneladas para el tráfico de narcóticos a través de embarcaciones marítimas y también para producción y distribución de cocaína, a sabiendas y con la intención de que dichos estupefacientes serían importados ilegalmente a los Estados Unidos.

El Clan del Golfo

Entre el 2012, hasta el momento de su captura por las fuerzas militares y policiales colombianas, el 23 de octubre del 2021, Úsuga David estuvo al mando del CDG.

El CDG, una de las organizaciones criminales más violentas y poderosas de Colombia,  es uno de los mayores distribuidores de cocaína del mundo.  Con aproximadamente 6.000 miembros, el CDG ejerce control militar sobre vastas extensiones de territorio en la región de Urabá en Antioquia, Colombia, una de las áreas de narcotráfico más lucrativas dentro de Colombia debido a su proximidad a la frontera entre Colombia y Panamá y las costas del Caribe y el Pacífico.  Vestidos con uniformes militares, los miembros del CDG emplean tácticas y armamento militar como demostración de su poder y para incitar a la guerra y la violencia contra narcotraficantes rivales, organizaciones paramilitares y autoridades policiales colombianas que amenacen el control del CDG.  

El CDG financia sus operaciones principalmente a través del tráfico de drogas.  Impone un "impuesto" a cualquier narcotraficante que opere en el territorio bajo su control, cobrando tarifas por cada kilogramo de cocaína que sea producido, almacenado o transportado a través de áreas controladas por la organización.  El CDG también exporta directamente cocaína y coordina la producción, compra y transferencia de cargamentos semanal y quincenalmente de varias toneladas de cocaína desde Colombia a Centroamérica y México para su destino final, los Estados Unidos. 

Para mantener el control sobre el territorio del CDG, Úsuga David y el CDG empleaban un ejército de "sicarios", o gatilleros, que llevaron a cabo actos de violencia, incluyendo homicidios, asaltos, secuestros, torturas y asesinatos contra competidores y aquellos considerados traidores a la organización, y así como sus familiares.  El CDG asesinaba y agredía a agentes del orden público de Colombia hola, personal militar colombiano, narcotraficantes y paramilitares rivales, testigos potenciales y a civiles.  Úsuga David y el CDG hicieron uso de violencia para promover y mejorar la reputación y la posición del CDG con respecto a las organizaciones criminales rivales; preservar, proteger y expandir el poder y el territorio del CDG; financiar las operaciones del CDG y enriquecer a sus líderes a través del cobro de deudas por drogas; mantener la disciplina entre sus miembros y asociados; y proteger a los miembros del CDG de la detención y el enjuiciamiento a través del intento de silenciar testigos potenciales y tomar represalias represalias contra autoridades policiales y aquellos que asistan a las autoridades en el cumplimiento de la ley.

La conducta del acusado

Según documentos judiciales, Úsuga David se desempeñó como líder de alto rango dentro del CDG desde su inicio y fue su principal líder durante 10 años.  Bajo su dirección, Úsuga David supervisaba todas las actividades del CDG y ordenaba a sus miembros llevar a cabo una serie de actos delictivos, que incluían él uso de la violencia, ordenar "huelgas" o cese de toda actividad comercial y cese de desplazamiento de la población civil dentro de regiones designadas de Colombia, represalias contra las autoridades policiales y contra posibles testigos, el ejercicio del control sobre las instalaciones de producción de drogas y las rutas de tráfico y la exportación de toneladas de cocaína.

Úsuga David asumió el poder y el control territorial sobre vastas franjas de la costa colombiana y dirigió personalmente a los miembros del CDG a cometer actos de violencia para afianzar dicho poder.  Esto incluía la violencia contra civiles.  Por ejemplo, a principios del 2012, tras la muerte del hermano de Úsuga David, Juan de Dios Úsuga David (también conocido como "Giovanni"), en una redada policial, Úsuga David ordenó que se impusiera un cierre o "huelga" de varios días en las ciudades y comunidades bajo el control del CDG.  Durante la huelga, los miembros de CDG ordenaron que todos los negocios permanecieran cerrados y que los residentes permanecieran en sus hogares.  Durante varios días, las calles permanecieron vacías, ya que Úsuga David ordenó a los miembros del CDG que ejecutaran a aquellos que no cumplieran con sus órdenes. 

Úsuga David también ordenaba personalmente a los miembros del CDG que cometieran asesinatos de particulares, incluidos los asesinatos de narcotraficantes rivales y miembros del CDG que lo hayan traicionado a él o a la organización.  Por ejemplo, Úsuga David ordenó el asesinato de varias personas que trabajaban para una organización narcotraficante rival dirigida por Daniel Barrera Barrera.   Úsuga David también ordenó la tortura y asesinato de un miembro del CDG que proporcionó información a la organización de Barrera.  Ese individuo fue posteriormente torturado, enterrado vivo, exhumado y decapitado post mortem.

Además, Úsuga David ordenaba Con frecuencia a miembros del CDG que hicieran uso de la violencia, intimidación y el asesinato para disuadir a las autoridades policiales de cumplir con sus deberes y silenciar a posibles testigos.  Por ejemplo, bajo la dirección de Úsuga David, el CDG llevó a cabo campañas organizadas, conocidas como "Plan Pistolas", para matar a personal policial y militar colombiano utilizando armas de tipo militar, las que incluían: granadas, explosivos y rifles de asalto.  Úsuga David también ofrecía recompensas por el asesinato de policías y militares colombianos para intimidar a las autoridades policiales y evitar que lo capturasen o interfieran con los asuntos del CDG.  La organización de Úsuga David llevó a cabo numerosos intentos para asesinar a personas que se creía que estaban cooperando con la policía.  Por ejemplo, miembros del CDG intentaron envenenar con cianuro a un testigo que se encontraba encarcelado en el extranjero e intentaron también asesinar a su abogado.

Úsuga David también estuvo ampliamente involucrado en actividades de tráfico de estupefacientes que financiaban y permitían ganar poder al CDG.  Supervisaba todas las exportaciones de narcotráfico del CDG y dirigía una red de "cobradores de deudas" encargados de imponer y recaudar impuestos cobrados a organizaciones de narcotráfico que operaban en regiones controladas por el CDG.   Además, Úsuga David controlaba las instalaciones de producción de cocaína y utilizaba la extensa red de distribución del CDG para exportar cocaína de forma independiente para beneficio personal.

Confiscación de activos

Como parte del acuerdo pactado con la fiscalía, Úsuga David acordó pagar una incautación de $ 216 millones.  El fallo sobre la incautación de este monto está sujeto a la concertación entre el Gobierno de los Estados Unidos de América y el Gobierno de la República de Colombia sobre la Participación y Decomiso de los Instrumentos y Productos del Delito.

La investigación, extradición y condena de Úsuga David es parte de una investigación de la unidad de Tarea de Control de Drogas contra el Crimen Organizado (OCDETF). OCDETF identifica, interrumpe y desmantela a los narcotraficantes de más alto nivel, blanqueadores de dinero, pandillas y organizaciones delictivas transnacionales que amenazan a los Estados Unidos, mediante el uso de un enfoque dirigido por fiscales, impulsado por datos de inteligencia y de múltiples agencias que aprovechas las fortalezas de las agencias federales, estatales y locales del orden público contra las redes delictivas.

La causa está siendo presentada por la Sección Internacional de Narcóticos y Lavado de Dinero del Distrito Este de Nueva York.  Francisco J. Navarro, fiscal federal del ministerio público, Gillian A. Kassner y Tara B. McGrath están a cargo de la acusación con el apoyo de la asistente legal Sophia Cronin, y la Fiscal Federal Adjunta Claire S. Kedeshian de la Oficina de la Sección de Recuperación de Activos está manejando todo lo relacionado con la incautación. El Fiscal Federal Adjunto Robert Emery del Distrito Sur de Florida y el Fiscal Federal Adjunto Alexander Li del Distrito Sur de Nueva York dirigieron los procesamientos para sus respectivas oficinas.

The Defendant:

Dairo Antonio Úsuga David (también conocido como "Otoniel", "Mao", "Gallo" y "Mauricio-Gallo")
Edad: 51
Antioquia, Colombia

E.D.N.Y. Expediente Núm. 14-CR-625 (S-4) (DLI)

                                     23-CR-021 (DLI)

                                     23-CR-027 (DLI)

CENTRAL ISLIP, NY – Earlier today, in federal court in Central Islip, Scott Gammon was sentenced by United States District Judge Joan M. Azrack to 36 months in prison for participating in a mass mailing scheme that tricked consumers into paying fees for falsely promised cash prizes. As part of the sentence, Gammon was also ordered to forfeit $139,611.97.

Breon Peace, United States Attorney for the Eastern District of New York, Brian M. Boynton, Principal Deputy Assistant Attorney General of the Justice Department’s Civil Division, and Daniel B. Brubaker, Inspector-in-Charge, United States Postal Inspection Service (USPIS), announced the sentence.

“Financially exploiting the elderly and other victims through fraudulent prize schemes is a form of abuse and deserving of punishment as today’s sentence demonstrates,” stated United States Attorney Peace.  “A term in prison should deter others from preying on the vulnerable.”

“Participants in fraud schemes face the prospect of federal prison,” stated Principal Deputy Assistant Attorney General Boynton. “The Department of Justice is committed to protecting elderly and vulnerable Americans and to prosecuting individuals who engage in such schemes.”

“Today’s sentencing brings to a close the investigation of Mr. Gammon, who devised a fake prize promotion scheme designed to defraud older Americans and steal from those who believed they had won a prize.  Unfortunately, for those who participated, they realized too late that they had been swindled. When a prize did not materialize, and their money was not returned, they became victims. Postal Inspectors remind consumers to be ever vigilant and play an active role in protecting their money.  If you’re asked to pay for a prize you didn’t enter to win, it’s a scam,” stated USPIS Inspector-in-Charge Brubaker.

From August 2014 through August 2019, Gammon engaged in a direct-mail scheme that sent fraudulent prize notification mailings to thousands of consumers. The mailings induced consumers to pay a fee, purportedly in return for a large cash prize. None of the consumers who sent a fee ever received such a prize.  Co-defendants Christopher King and Natasha Khan also pleaded guilty to conspiracy to commit mail fraud and are awaiting sentencing.

The U.S. Postal Inspection Service investigated the case.

Assistant United States Attorney Charles P. Kelly of the Eastern District of New York’s Long Island Criminal Division is prosecuting the case with Trial Attorneys Daniel Zytnick and Timothy Finley of the Civil Division’s Consumer Protection Branch.  Assistant United States Attorney Tanisha Payne of the Eastern District’s Asset Recovery Section is handing forfeiture matters.

The department seeks to prevent the widespread losses seniors and other consumers suffer from fraud schemes.  The best method to prevent fraud is to share information about the various types of elder fraud schemes with relatives, friends, neighbors and other seniors who can use that information to protect themselves.

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

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

The Defendant Sentenced Today:

SCOTT GAMMON
Age: 48
Howard Beach, Queens

The Defendants Awaiting Sentencing

CHRISTOPHER KING
Age: 37
Oceanside, New York

NATASHA KHAN
Age: 39
Elmont, New York

E.D.N.Y. Docket No.: 22-CR-85 (JMA)

Сегодня в федеральном суде Бруклина было обнародовано обвинительное заключение по восьми пунктам, в котором Марату Лернеру [Marat Lerner], президенту компании Lerner Group, было предъявлено обвинение в заговоре с целью совершения мошенничества с использованием электронных средств, мошенничества с использованием электронных средств и отмывания денег в связи со схемой кражи у клиентов его компании по изменению ипотечных кредитов. 

Бреон Пис [Breon Peace], прокурор США по Восточному округу Нью-Йорка, и Майкл Дж. Дрисколл [Michael J. Driscoll], помощник директора Федерального бюро расследований (ФБР) в Региональном управлении Нью-Йорка, объявили об аресте и предъявлении обвинений.

«Обвиняемый охотился на иммигрантов в русской общине Бруклина, обремененных ипотечным долгом, похищая их американскую мечту с помощью схемы, построенной на ложных обещаниях помочь им сохранить свои дома, но на самом деле, пользовался их доверием для личного обогащения, — заявил прокурор США Пис. —  Прокуратура уделяет первоочередное внимание защите уязвимых жителей нашего округа, и мы призываем их добровольно дать показания и довериться нам, чтобы добиться справедливости для них». 

Г-н Пис выразил признательность Погранично-таможенной службе США и Департаменту полиции города Нью-Йорка за их помощь в этом вопросе.

«Обвиняемый, как мы утверждаем сегодня, финансировал свой расточительный образ жизни, осуществляя длительную аферу по использованию доверия и страхов своих жертв с целью похищения их денег, а не выполнял свое обещание изменить их ипотечные кредиты», — заявил помощник директора ФБР Дрисколл. —  ФБР будет продолжать следить за тем, чтобы любой человек, желающий обмануть и ввести в заблуждение клиентов с целью похищения их с трудом заработанных денег, столкнется с последствиями в системе уголовного правосудия.  Мы призываем любых дополнительных жертв схемы г-на Лернера связаться с нами по телефону 1-800-CALL-FBI или через Интернет по адресу www.iC3.gov».

В обвинительном заключении утверждается, что в период приблизительно с августа 2016 года по январь 2021 года Лернер вместе с другими лицами управлял компанией Lerner Group.  Lerner Group обещала клиентам, что может помочь им изменить их ипотечные кредиты, уменьшив ежемесячные платежи и непогашенные остатки по ипотечным кредитам.  Лернер использовал свой доступ к банковской информации своих клиентов для создания чеков, которые выглядели как ежемесячные выплаты по ипотеке предполагаемому агенту условного депонирования под названием Testoni & Villa, а также ипотечным банкам своих клиентов.  Но на самом деле Лернер тайно контролировал Testoni & Villa, и вместо того чтобы держать деньги на условном депонировании или переводить их в ипотечные банки, Лернер депонировал чеки на счет, который сам же и контролировал и который использовал для различных личных расходов, включая предметы роскоши и дорогие блюда, а также автомобиль BMW.  В общей сложности Лернер присвоил не менее 550 000 долларов своих клиентов. 

Если вы были клиентом компании Lerner Group и хотели бы подать жалобу, посетите веб-сайт www.iC3.gov.  В своей жалобе укажите «Lerner Group» или «Marat Lerner». 

Обвинения в обвинительном заключении являются утверждениями, и ответчик считается невиновным до тех пор, пока его вина не будет доказана.  В случае признания виновным Лернеру грозит до 20 лет лишения свободы.

Государственное обвинение находится в ведении Отдела по борьбе с мошенничеством в сфере бизнеса и ценных бумаг.  За уголовное преследование отвечает помощник прокурора США Ник М. Аксельрод [Nick M. Axelrod]. 

The Ответчикs:

МАРАТ ЛЕРНЕР
Возраст: 40
Бруклин, Нью-Йорк 

№ дела E.D.N.Y. 23-CR-15 (NGG)

Сегодня в федеральном суде Бруклина было обнародовано обвинительное заключение по восьми пунктам, в котором Марату Лернеру [Marat Lerner], президенту компании Lerner Group, было предъявлено обвинение в заговоре с целью совершения мошенничества с использованием электронных средств, мошенничества с использованием электронных средств и отмывания денег в связи со схемой кражи у клиентов его компании по изменению ипотечных кредитов. 

Бреон Пис [Breon Peace], прокурор США по Восточному округу Нью-Йорка, и Майкл Дж. Дрисколл [Michael J. Driscoll], помощник директора Федерального бюро расследований (ФБР) в Региональном управлении Нью-Йорка, объявили об аресте и предъявлении обвинений.

«Обвиняемый охотился на иммигрантов в русской общине Бруклина, обремененных ипотечным долгом, похищая их американскую мечту с помощью схемы, построенной на ложных обещаниях помочь им сохранить свои дома, но на самом деле, пользовался их доверием для личного обогащения, — заявил прокурор США Пис. —  Прокуратура уделяет первоочередное внимание защите уязвимых жителей нашего округа, и мы призываем их добровольно дать показания и довериться нам, чтобы добиться справедливости для них». 

Г-н Пис выразил признательность Погранично-таможенной службе США и Департаменту полиции города Нью-Йорка за их помощь в этом вопросе.

«Обвиняемый, как мы утверждаем сегодня, финансировал свой расточительный образ жизни, осуществляя длительную аферу по использованию доверия и страхов своих жертв с целью похищения их денег, а не выполнял свое обещание изменить их ипотечные кредиты», — заявил помощник директора ФБР Дрисколл. —  ФБР будет продолжать следить за тем, чтобы любой человек, желающий обмануть и ввести в заблуждение клиентов с целью похищения их с трудом заработанных денег, столкнется с последствиями в системе уголовного правосудия.  Мы призываем любых дополнительных жертв схемы г-на Лернера связаться с нами по телефону 1-800-CALL-FBI или через Интернет по адресу www.iC3.gov».

В обвинительном заключении утверждается, что в период приблизительно с августа 2016 года по январь 2021 года Лернер вместе с другими лицами управлял компанией Lerner Group.  Lerner Group обещала клиентам, что может помочь им изменить их ипотечные кредиты, уменьшив ежемесячные платежи и непогашенные остатки по ипотечным кредитам.  Лернер использовал свой доступ к банковской информации своих клиентов для создания чеков, которые выглядели как ежемесячные выплаты по ипотеке предполагаемому агенту условного депонирования под названием Testoni & Villa, а также ипотечным банкам своих клиентов.  Но на самом деле Лернер тайно контролировал Testoni & Villa, и вместо того чтобы держать деньги на условном депонировании или переводить их в ипотечные банки, Лернер депонировал чеки на счет, который сам же и контролировал и который использовал для различных личных расходов, включая предметы роскоши и дорогие блюда, а также автомобиль BMW.  В общей сложности Лернер присвоил не менее 550 000 долларов своих клиентов. 

Если вы были клиентом компании Lerner Group и хотели бы подать жалобу, посетите веб-сайт www.iC3.gov.  В своей жалобе укажите «Lerner Group» или «Marat Lerner». 

Обвинения в обвинительном заключении являются утверждениями, и ответчик считается невиновным до тех пор, пока его вина не будет доказана.  В случае признания виновным Лернеру грозит до 20 лет лишения свободы.

Государственное обвинение находится в ведении Отдела по борьбе с мошенничеством в сфере бизнеса и ценных бумаг.  За уголовное преследование отвечает помощник прокурора США Ник М. Аксельрод [Nick M. Axelrod]. 

The Ответчикs:

МАРАТ ЛЕРНЕР
Возраст: 40
Бруклин, Нью-Йорк 

№ дела E.D.N.Y. 23-CR-15 (NGG)

An eight-count indictment was unsealed today in federal court in Brooklyn charging Marat Lerner, president of the Lerner Group, with conspiracy to commit wire fraud, wire fraud, and money laundering in connection with a scheme to steal from clients of his mortgage loan modification business. 

Breon Peace, United States Attorney for the Eastern District of New York, and Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the arrest and charges.

“The defendant preyed on immigrants burdened by mortgage debt in the Russian community in Brooklyn, stealing their American dream through a scheme built on false promises to help them keep their homes, but in truth, he took advantage of their trust to enrich himself,” stated United States Attorney Peace.  “This Office has prioritized protecting vulnerable members of our district and we encourage them to come forward and put their trust in us to seek justice for them.” 

Mr. Peace expressed his appreciation to the U.S. Customs and Border Protection and the New York City Police Department for their assistance in this matter.

“The defendant, as we allege today, funded his own lavish lifestyle by operating a lengthy scam exploiting his victims' trust and fears in order to steal their money rather than fulfill his promise to modify their mortgages,” stated FBI Assistant Director-in-Charge Driscoll.  “The FBI will continue to make sure any individual willing to cheat and deceive clients out of their hard-earned money will face the consequences in the criminal justice system.  We urge any additional victims of Mr. Lerner’s scheme to contact us at 1-800-CALL-FBI or online at www.iC3.gov.”

The indictment alleges that, in or about and between August 2016 and January 2021, Lerner, together with others, operated the Lerner Group.  The Lerner Group promised clients it could help them modify their mortgages by reducing their monthly mortgage payments and their outstanding mortgage balances.  Lerner used his access to his clients’ banking information to create checks that appeared to be monthly mortgage payments to a purported escrow agent called Testoni & Villa and to his clients’ mortgage banks.  But in truth, Lerner secretly controlled Testoni & Villa, and instead of holding the money in escrow, or transferring it to the mortgage banks, Lerner deposited the checks in an account that he controlled, and which he used for a variety of personal expenses, including luxury goods and expensive meals and a BMW automobile.  In total, Lerner misappropriated at least $550,000 from his clients. 

If you were a Lerner Group client and would like to file a complaint, please visit www.iC3.gov.  Please reference “Lerner Group” or “Marat Lerner” in your complaint. 

The charges in the indictment are allegations, and the defendant is presumed innocent unless and until proven guilty.  If convicted, Lerner faces up to 20 years in prison.

The government’s case is being handled by the Office’s Business and Securities Fraud Section.  Assistant United States Attorney Nick M. Axelrod is in charge of the prosecution. 

The Defendants:

MARAT LERNER
Age: 40
Brooklyn, New York 

E.D.N.Y. Docket No. 23-CR-15 (NGG)

The founder and majority owner of a cryptocurrency exchange, Bitzlato Ltd. (Bitzlato), was arrested last night in Miami for his alleged operation of a money transmitting business that transported and transmitted illicit funds and that failed to meet U.S. regulatory safeguards, including anti-money laundering requirements. 

Anatoly Legkodymov, 40, a Russian national who resides in Shenzhen, People’s Republic of China, is scheduled to be arraigned this afternoon in the U.S. District Court for the Southern District of Florida. French authorities and the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) are taking concurrent enforcement actions.

“Today the Department of Justice dealt a significant blow to the cryptocrime ecosystem,” said Deputy Attorney General Lisa O. Monaco. “Overnight, the Department worked with key partners here and abroad to disrupt Bitzlato, the China-based money laundering engine that fueled a high-tech axis of cryptocrime, and to arrest its founder, Russian national Anatoly Legkodymov. Today’s actions send the clear message: whether you break our laws from China or Europe – or abuse our financial system from a tropical island – you can expect to answer for your crimes inside a United States courtroom.”

“As alleged, the defendant helped operate a cryptocurrency exchange that failed to implement required anti-money laundering safeguards and enabled criminals to profit from their wrongdoing, including ransomware and drug trafficking,” said Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division. “The National Cryptocurrency Enforcement Team’s tremendous efforts to disrupt Bitzlato and arrest the defendant demonstrate that we will continue to work with our partners – both foreign and domestic – to combat cryptocurrency-fueled crimes, even if they transcend international borders.”

According to court documents, Legkodymov is a senior executive and the majority shareholder of Bitzlato, a Hong Kong-registered cryptocurrency exchange that operates globally. Bitzlato has marketed itself as requiring minimal identification from its users, specifying that “neither selfies nor passports [are] required.” On occasions when Bitzlato did direct users to submit identifying information, it repeatedly allowed them to provide information belonging to “straw man” registrants.

“Institutions that trade in cryptocurrency are not above the law and their owners are not beyond our reach,” said U.S. Attorney Breon Peace for the Eastern District of New York. “As alleged, Bitzlato sold itself to criminals as a no-questions-asked cryptocurrency exchange, and reaped hundreds of millions of dollars’ worth of deposits as a result. The defendant is now paying the price for the malign role that his company played in the cryptocurrency ecosystem.”

As a result of these deficient know-your-customer (KYC) procedures, Bitzlato allegedly became a haven for criminal proceeds and funds intended for use in criminal activity. Bitzlato’s largest counterparty in cryptocurrency transactions was Hydra Market (Hydra), an anonymous, illicit online marketplace for narcotics, stolen financial information, fraudulent identification documents, and money laundering services that was the largest and longest running darknet market in the world. Hydra users exchanged more than $700 million in cryptocurrency with Bitzlato, either directly or through intermediaries, until Hydra was shuttered by U.S. and German law enforcement in April 2022. Bitzlato also received more than $15 million in ransomware proceeds.

“The FBI will continue to pursue actors who attempt to mask their criminal activity behind keyboards and use means such as cryptocurrency to evade law enforcement,” said Associate Deputy Director Brian Turner of the FBI. “We, along with our federal and international partners, will work relentlessly to disrupt and dismantle these types of criminal enterprises. Today’s arrest should serve as a reminder the FBI will impose risk and consequences upon those who engage in these activities.”

“As alleged today, Legkodymov knowingly allowed Bitzlato to become a perceived safe haven for funds used for and resulting from a variety of criminal activities,” said Assistant Director in Charge Michael J. Driscoll of the FBI New York Field Office. “The FBI and our partners remain steadfast in our commitment to keeping cryptocurrency markets – as with any financial market – free from illicit activity.  Today’s action should serve as an example of this commitment as Legkodymov will now face the consequences of his actions in our criminal justice system.”

As alleged in the complaint, Bitzlato’s customers routinely used the company’s customer service portal to request support for transactions with Hydra, which Bitzlato often provided, and admitted in chats with Bitzlato personnel that they were trading under assumed identities. Moreover, Legkodymov and Bitzlato’s other managers were aware that Bitzlato’s accounts were rife with illicit activity and that many of its users were registered under others’ identities. For instance, on May 29, 2019, Legkodymov used Bitzlato’s internal chat system to write to a colleague that Bitzlato’s users were “known to be crooks,” using others’ identity documents to register their accounts. Legkodymov was repeatedly warned by colleagues that Bitzlato’s customer base consisted of “addicts who buy drugs at [] Hydra” and “drug traffickers,” with one senior executive even stressing that Bitzlato should combat drug dealers only “nominally,” to avoid hurting the company’s bottom line. An internal spreadsheet saved in Bitzlato’s shared management folder encapsulated the company’s view of itself: “Positives: No KYC. . . . Negatives: Dirty money. . . .”

As alleged in the complaint, although Bitzlato claimed not to accept users from the United States, it did substantial business with U.S.-based customers, and its customer service representatives repeatedly advised users that they could transfer funds from U.S. financial institutions. Moreover, Legkodymov – who himself administered Bitzlato from Miami in 2022 and 2023 – received reports reflecting substantial traffic to Bitzlato’s website from U.S.-based Internet Protocol addresses, including over 250 million such visits in July 2022.

Legkodymov is charged with conducting an unlicensed money transmitting business. If convicted, he faces a maximum penalty of five years in prison.

Concurrent with the arrest announced today, French authorities, working with Europol and partners in Spain, Portugal, and Cyprus, dismantled Bitzlato’s digital infrastructure, seized Bitzlato’s cryptocurrency, and took other enforcement actions.

In addition, the Treasury Department’s FinCEN announced an Order pursuant to section 9714(a) of the Combating Russian Money Laundering Act, as amended, identifying Bitzlato as a “primary money laundering concern” in connection to Russian illicit finance. The order imposes a special measure prohibiting certain transmittals of funds involving Bitzlato by any covered financial institution.

National Cryptocurrency Enforcement Team (NCET) Trial Attorneys Alexander Mindlin, Scott Meisler, and Matthew Blackwood of the Justice Department’s Criminal Division and Assistant U.S. Attorney Artie McConnell for the Eastern District of New York are prosecuting the case, with assistance from Paralegal Specialist Mary Clare McMahon.

The Justice Department investigated this case in close coordination with French law enforcement authorities and the Treasury Department’s FinCEN, both of which took separate enforcement actions today under their respective authorities. The Justice Department’s Office of International Affairs and the FBI’s Legal Attaché in France provided critical assistance in this case, with significant support from the department’s Cyber Operations International Liaison. The NCET and U.S. Attorney’s Office for the Eastern District of New York also extend their appreciation to the Cyber Division of the Paris Prosecution Office and to France’s Gendarmerie Nationale Cyberspace Command (Cyber Crime Investigation Unit / C3N). Assistance was also provided by the Customs and Border Protection, the Transportation Safety Administration, and the New York City Police Department. EUROPOL and Dutch and Belgian authorities have contributed to the overall investigation with respect to operational expertise, coordination, and information-sharing.

The NCET was established to combat the growing illicit use of cryptocurrencies and digital assets. Under the Criminal Division, the NCET conducts and supports investigations into individuals and entities that enable the use of digital assets to commit and facilitate a variety of crimes, with a particular focus on virtual currency exchanges, mixing and tumbling services, and infrastructure providers. The NCET also sets strategic priorities regarding digital asset technologies, identifies areas for increased investigative and prosecutorial focus, and leads the department’s efforts to collaborate with domestic and foreign government agencies as well as the private sector to aggressively investigate and prosecute crimes involving cryptocurrency and digital assets. 

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

Defendant Wrote on Bitzlato’s Internal Chat Room That its Users Were “Known to be Crooks”

BROOKLYN, NY –   A complaint was unsealed this morning in federal court in Brooklyn charging Anatoly Legkodymov, a Russian national and senior executive of Bitzlato Ltd. (Bitzlato), a Hong Kong-registered cryptocurrency exchange, with conducting a money transmitting business that transported and transmitted illicit funds and that failed to meet U.S. regulatory safeguards, including anti-money laundering requirements.  Legkodymov was arrested last night in Miami and is scheduled to be arraigned this afternoon in the U.S. District Court for the Southern District of Florida. French authorities and the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) are taking concurrent enforcement actions.

Breon Peace, United States Attorney for the Eastern District of New York; Lisa O. Monaco, Deputy Attorney General for the Department of Justice; Kenneth A. Polite, Assistant Attorney General for the Department of Justice’s Criminal Division; Brian C. Turner, Associate Deputy Director, Federal Bureau of Investigation (FBI); and Michael J. Driscoll, Assistant Director-in-Charge, FBI, New York Field Office, announced the arrest and charge.

“Institutions that trade in cryptocurrency are not above the law and their owners are not beyond our reach,” stated U.S. Attorney Breon Peace. “As alleged, Bitzlato sold itself to criminals as a no-questions-asked cryptocurrency exchange, and reaped hundreds of millions of dollars’ worth of deposits as a result. The defendant is now paying the price for the malign role that his company played in the cryptocurrency ecosystem.”

“Today the Department of Justice dealt a significant blow to the cryptocrime ecosystem,” stated Deputy Attorney General Monaco. “Overnight, the Department worked with key partners here and abroad to disrupt Bitzlato, the China-based money laundering engine that fueled a high-tech axis of cryptocrime, and to arrest its founder, Russian national Anatoly Legkodymov. Today’s actions send the clear message: whether you break our laws from China or Europe—or abuse our financial system from a tropical island—you can expect to answer for your crimes inside a United States courtroom.”            

“As alleged, the defendant helped operate a cryptocurrency exchange that failed to implement anti-money laundering safeguards and enabled criminals to profit from their wrongdoing, including ransomware and drug trafficking,” stated Assistant Attorney General Polite.  “The National Cryptocurrency Enforcement Team’s tremendous efforts to disrupt Bitzlato and arrest the defendant demonstrate that we will continue to work with our partners – both foreign and domestic – to combat cryptocurrency-fueled crimes, even if they transcend international borders.”

“The FBI will continue to pursue actors who attempt to mask their criminal activity behind keyboards and use means such as cryptocurrency to evade law enforcement,” stated FBI Assistant Deputy Director Turner.  “We, along with our federal and international partners, will work relentlessly to disrupt and dismantle these types of criminal enterprises.  Today’s arrest should serve as a reminder the FBI will impose risk and consequences upon those who engage in these activities.”

“As alleged today, Legkodymov knowingly allowed Bitzlato to become a perceived safe haven for funds used for and resulting from a variety of criminal activities.  The FBI and our partners remain steadfast in our commitment to keeping cryptocurrency markets – as with any financial market – free from illicit activity.  Today’s action should serve as an example of this commitment as Legkodymov will now face the consequences of his actions in our criminal justice system,” stated FBI Assistant Director-in-Charge Driscoll.

According to court documents, Legkodymov is a senior executive and the majority shareholder of Bitzlato Ltd. (Bitzlato), a Hong Kong-registered cryptocurrency exchange that operates globally. Bitzlato has marketed itself as requiring minimal identification from its users, specifying that “neither selfies nor passports [are] required.” On occasions when Bitzlato did direct users to submit identifying information, it repeatedly allowed them to provide information belonging to “straw man” registrants.

As a result of these deficient know-your-customer (KYC) procedures, Bitzlato allegedly became a haven for criminal proceeds and funds intended for use in criminal activity. Bitzlato’s largest counterparty in cryptocurrency transactions was Hydra Market, an anonymous, illicit online marketplace for narcotics, stolen financial information, fraudulent identification documents, and money laundering services that was the largest and longest running darknet market in the world. Hydra Market users exchanged more than $700 million in cryptocurrency with Bitzlato, either directly or through intermediaries, until Hydra Market was shuttered by U.S. and German law enforcement in April 2022. Bitzlato also received more than $15 million in ransomware proceeds.

As alleged in the complaint, Bitzlato’s customers routinely used the company’s customer service portal to request support for transactions with Hydra, which Bitzlato often provided, and admitted in chats with Bitzlato personnel that they were trading under assumed identities.  Moreover, Legkodymov and Bitzlato’s other managers were aware that Bitzlato’s accounts were rife with illicit activity and that many of its users were registered under others’ identities. For instance, on May 29, 2019, Legkodymov used Bitzlato’s internal chat system to write to a colleague that Bitzlato’s users were “known to be crooks,” using others’ identity documents to register their accounts. Legkodymov was repeatedly warned by colleagues that Bitzlato’s customer base consisted of “addicts who buy drugs at [] Hydra” and “drug traffickers,” with one senior executive even stressing that Bitzlato should combat drug dealers only “nominally,” to avoid hurting the company’s bottom line.  An internal spreadsheet saved in Bitzlato’s shared management folder encapsulated the company’s view of itself: “Positives: No KYC. . . . Negatives: Dirty money. . . .”

As alleged in the complaint, although Bitzlato claimed not to accept users from the United States, it did substantial business with U.S.-based customers, and its customer service representatives repeatedly advised users that they could transfer funds from U.S. financial institutions. Moreover, Legkodymov – who himself administered Bitzlato from Miami in 2022 and 2023 – received reports reflecting substantial traffic to Bitzlato's website from U.S.-based Internet Protocol addresses, including over 250 million such visits in July 2022.

The charge in the complaint is an allegation and the defendant is presumed innocent unless and until proven guilty. If convicted of operating an illegal money transmitting business, he faces a maximum penalty of five years in prison.

Concurrent with the arrest announced today, French authorities, working with Europol and partners in Spain, Portugal, and Cyprus, dismantled Bitzlato’s digital infrastructure and took enforcement actions.

The investigation is being jointly prosecuted by the National Security and Cybercrime Section of the United States Attorney’s Office for the Eastern District of New York and the National Cryptocurrency Enforcement Team (NCET).  NCET Trial Attorneys Alexander Mindlin, Scott Meisler, and Matthew Blackwood of the Justice Department’s Criminal Division and Assistant U.S. Attorney Artie McConnell of the Eastern District of New York are prosecuting the case, with assistance from Paralegal Specialist Mary Clare McMahon.

The Justice Department investigated this case in close coordination with French law enforcement authorities and the Treasury Department’s FinCEN, both of which took separate actions today under their respective authorities. The Justice Department’s Office of International Affairs and the FBI’s Legal Attaché in France provided critical assistance in this case, with significant support from the department’s Cyber Operations International Liaison.

The NCET and U.S. Attorney’s Office for the Eastern District of New York also extend their appreciation to the Cyber Division of the Paris Prosecution Office and to France’s Gendarmerie Nationale Cyberspace Command (Cyber Crime Investigation Unit / C3N).  Assistance was also provided by the Customs and Border Protection, the Transportation Safety Administration, and the New York City Police Department. EUROPOL and Dutch and Belgian authorities have contributed to the overall investigation with respect to operational expertise, coordination, and information-sharing.

The NCET was created in October 2021 to combat the growing illicit use of cryptocurrencies and digital assets. Under the supervision of the Criminal Division, the NCET conducts and supports investigations into individuals and entities that enable the use of digital assets to commit and facilitate a variety of crimes, with a particular focus on virtual currency exchanges, mixing and tumbling services, and infrastructure providers. The NCET also sets strategic priorities regarding digital asset technologies, identifies areas for increased investigative and prosecutorial focus, and leads the department’s efforts to collaborate with domestic and foreign government agencies as well as the private sector to aggressively investigate and prosecute crimes involving cryptocurrency and digital assets. 

The Defendant:

ANATOLY LEGKODYMOV (also known as “Anatolii Legkodymov”, “Gandalf”, and “Tolik”)
Age:  40
Residence: Shenzen, People’s Republic of China; Russia

E.D.N.Y. Docket No.: 23-MJ-17

Defendant’s Co-Conspirators Sexually Assaulted One Victim Inside Her Home

Earlier today, at the federal courthouse in Brooklyn, Lamonte Johnson was sentenced by United States District Judge Raymond J. Dearie to 96 months’ imprisonment for conspiring to commit robbery and using force and threats in furtherance of robbery, in his role as lead organizer of a home-invasion crew.  The sentence will run consecutive to Johnson’s two 20 years-to-life state prison sentences that he was already serving following his conviction for a 1986 double homicide.  Johnson was convicted of the federal robbery charges following a one-week jury trial in May 2022.  Johnson’s four co-conspirators previously pleaded guilty to related offenses.

Breon Peace, United States Attorney for the Eastern District of New York announced the sentence.

“Lamonte Johnson was not deterred by prison walls from organizing armed home-invasion robberies, but today’s sentence ensures he has been held accountable for these vicious crimes, and that there is justice for his victims,” stated United States Attorney Peace. 

Mr. Peace thanked the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives and the New York City Police Department for their work leading the investigation.

As proven at trial and detailed in public filings, in March 2019 Johnson was serving consecutive 20 years-to life sentences for two murders in state prison when he organized a robbery crew with the goal of targeting Chinese American victims.  Johnson connected his half-brother John Martin with Shi Zhen Lin, a former inmate who Johnson knew from prison.  Lin’s role in the conspiracy was to identify Chinese American targets for the crew to rob.  Martin recruited other members to join the crew and together they committed or attempted to commit multiple robberies in Queens, Long Island and New Jersey.  In May 2019, Corey Mobley, Brandon Daniels, and Martin committed a home-invasion robbery in Little Neck, Queens.  During the robbery, Mobley and Daniels held at gunpoint a group of women and children and sexually assaulted one of the victims.   

Johnson’s co-conspirators have been sentenced to terms of imprisonment ranging from seven years, for Lin, to 19 years for Mobley.

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone.  The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally based strategies to reduce violent crime.

The government’s case is being handled by the Office’s Organized Crime and Gangs Section.  Assistant United States Attorneys Jonathan Siegel and Michael W. Gibaldi are in charge of the prosecution, with assistance from Paralegal Specialist Brittany Wissel.

The Defendant:

Lamonte johnson
Age:  54
Auburn, New York

Defendants Previously Sentenced

JOHN MARTIN (also known as “Lil John” and “LJ”)
Age:  50
Brooklyn, New York

BRANDON DANIELS
Age:  28
Brooklyn, New York

SHI ZHEN LIN (also known as “Kevin Lin” and “Kev”)
Age:  31
Maspeth, New York

COREY MOBLEY
Age:  52
Brooklyn, New York

E.D.N.Y. Docket No. 19-CR-221 (S-3)

An indictment was partially unsealed this afternoon in federal court in Brooklyn charging Martial H. Amilcar, also known as “Drippy,” and a co-defendant with the murder of 15-year-old Samuel Joseph.  The indictment charges Amilcar, a senior member of the Hyena Crips gang, with killing Joseph in front of his teenage sister on February 22, 2019 as Joseph was leaving his apartment building near the Little Haiti section of Brooklyn.  Amilcar was taken into federal custody earlier today, and is scheduled to be arraigned tomorrow before United States Magistrate Judge Taryn A. Merkl.  If convicted of murder during and through the use of a firearm in relation to murder in-aid-of racketeering, Amilcar faces a potential sentence of life imprisonment or the death penalty.

Breon Peace, United States Attorney for the Eastern District of New York, and Ivan J. Arvelo, Special Agent-in-Charge, Homeland Security Investigations, New York (HSI), announced the arrest and charge.

“There is no crime more heinous than the killing of an innocent child.  As alleged, Amilcar and his co-defendant brazenly murdered 15-year-old Samuel Joseph in retaliation for activities this young boy had nothing to do with,” stated United States Attorney Peace.  “The brutal cycle of gang violence in this district, including the violence perpetrated by members of the Hyena Crips, must be stopped.  We and our law enforcement partners are committed to that end.  It is my hope that today’s indictment brings some measure of justice for the victim’s family.” 

Mr. Peace expressed his appreciation to HSI’s Violent Gang Task Force and the New York City Police Department for their outstanding work in this investigation.

“While nothing can undo the pain that Martial Amilcar and his co-defendant allegedly inflicted upon the family of Samuel Joseph, it is my hope  that by seeing him held accountable for his alleged crimes, they will be given some form of peace,” stated HSI  Special Agent-in-Charge Arvelo.  “HSI New York, along with our law enforcement partners, are dedicated to the eradication of gang violence in our communities, and we will continue to seek, apprehend, and hold accountable those who intend perpetuate such cruelty.”

As alleged in court documents, on February 22, 2019, Amilcar and a co-defendant drove to Samuel Joseph’s apartment building and waited outside until Joseph’s teenage sister arrived at the building’s entrance.  While Joseph’s sister prepared to enter the building, Samuel Joseph was walking down an internal staircase towards the building’s exit.  When Joseph’s sister opened the building door to enter, Amilcar walked into the building behind her, pulled out a gun and shot the 15-year-old boy three times at close range, killing him.
The shooting and events leading up to it were captured on security camera footage taken nearby.

Amilcar and another individual allegedly killed Samuel Joseph in retaliation for an altercation earlier that day between Amilcar’s relative, a fellow gang member, and Joseph’s older brother, a rival gang member.

The charge in the indictment is an allegation and the defendant is presumed innocent unless and until proven guilty.

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone.  The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally based strategies to reduce violent crime.

The government’s case is being handled by the Office’s Organized Crime and Gangs Section.  Assistant United States Attorneys Devon Lash, Andrew Wenzel, Jessica Weigel, and Joshua Dugan are in charge of the prosecution.

The Defendant:

MARTIAL H. AMILCAR (also known as “Drippy”)
Age:  26
Brooklyn, New York

E.D.N.Y. Docket No. 23-CR-18 (PKC)

Hi, I’m United States Attorney for the Eastern District of New York Breon Peace. Thank you all for joining us today. With me today are: Keechant Sewell, Commissioner of the New York City Police Department, James W. Essig, Chief of Detectives of the New York City Police Department, Deputy Chief Joseph Gulotta, Commanding Officer of Detective Borough Brooklyn South, Captain Genienne King, Commanding Officer of Violent Crimes Squad, Detective Borough Brooklyn South, Captain Gary Marcus, Lieutenant Mohammed Islam, Detective Michael Griffith, of Detective Borough Brooklyn South Violent Crimes Squad, Frank Tarentino, III, Special Agent in Charge of the Drug Enforcement Administration, New York Division, and My U.S. Attorney’s Office team, Assistant United States Attorneys Adam Amir, Irisa Chen, James Simmons, and Francisco Navarro.

We are here today to announce the arrest and charging of four defendants, David Mccann, Tajhai Jones, Raymond Minaya, and Calvin Tabron for trafficking over 50 firearms, fentanyl, and crack cocaine in the Canarsie neighborhood of Brooklyn. This is one of the first prosecutions in the nation—and the first unsealed indictment in New York—under the Bipartisan Safer Communities Act, the first federal statute specifically designed to target gun trafficking, which was enacted by Congress in June 2022. The charges brought today exemplify how the Bipartisan Safer Communities Act can be used as an effective tool in our continued battle against gun violence that plagues communities in Brooklyn, across New York City and Long Island, and across the nation.

These charges and the arrest made today are the culmination of a significant investigation into firearms and narcotics trafficking occurring largely in and near the Breukelen Houses public housing complex in Canarsie. The defendants sold an NYPD undercover officer over 50 guns. The defendants, of course, did not believe they were selling guns to a law enforcement officer. They thought they were selling these guns to a drug dealer.  The undercover officer told the defendants that he was a drug dealer who needed guns and that he was also going to resell some of the guns. Despite this knowledge, Mccann and others continued to sell large quantities of drugs and guns to the undercover officer without hesitation.

Some of the firearms were made from “ghost gun” kits. Certain of the guns sold had a defaced serial number, which makes it more difficult for law enforcement to trace them. Several of the guns trafficked by the defendants have been linked by law enforcement to prior violence in Brooklyn. For example, one defendant, Minaya, sold the undercover officer a gun that was used in an August 21, 2021 shooting in Bedford-Stuyvesant during which armed perpetrators shot into a large crowd gathered for a family day celebration.  In total, eight people were shot. Another gun sold by Minaya to the undercover officer is linked to a December 18, 2021 shooting of an individual in Canarsie, in the blocks surrounding the Breukelen Houses complex.  That individual sustained multiple gunshot wounds to his body, including his right hand, shoulder, neck, and the base of his skull.

The investigation revealed that defendant Tabron would often purchase three or four guns at a time from retailers in Virginia Beach and Lynnhaven, Virginia, for the express purpose of bringing them to Brooklyn to engage in sales set up by his co-defendants.

While engaging in the gun trafficking conspiracy, Mccann and co-conspirators also sold more than a kilogram of fentanyl to the undercover officer.  Mccann and Minaya also engaged in a narcotics conspiracy that sold over 100 grams of crack cocaine to the undercover officer.

The defendants’ drug and gun deals occurred primarily in vehicles outside homes in Canarsie.  Almost all the deals occurred in the middle of the afternoon and in broad daylight, with the dealers sometimes boldly walking down public streets carrying bags of dangerous guns past residents. And, many of these transactions took place during the day in the summer months at the Canarsie Pier—a popular recreational area where scores of Brooklyn families picnic and play with their children at the playground. 

The evidence of the defendants’ involvement in the alleged conduct includes (1) video and audio recordings made by the undercover officer during gun and drug sales with the defendants; (2) text and telephone records; (3) surveillance, GPS and social media showing the defendants’ whereabouts at particular times; and (4) physical evidence, including firearms, ammunition and drugs. 

Additionally, when agents arrested one of the defendants in Brooklyn this morning, he was in illegal possession of two handguns, including one with an extended magazine. The defendant threw one of the guns out a window in an attempt to hide it. But agents recovered both guns at the scene.

By charging the defendants today, our Office and law enforcement partners have interrupted a network of firearms traffickers that endangers our community. Prosecutions of gun trafficking prior to the enactment of the Bipartisan Safer Communities Act relied on statutes concerning unlicensed sale, transport and delivery of firearms, and false statements made to acquire firearms. By using the new law in the charges today, we are able to streamline these prosecutions by charging firearm trafficking conspiracy as a standalone federal crime.  This charge also comes with increased penalties should the defendants be proven guilty.

As the first prosecution to utilize this new legislation in New York, and one of the first in the country, we are demonstrating that we are prepared to use all the tools at our disposal—new and old—to combat gun violence. Reducing gun violence will always be one of the foremost priorities of this Office. 

I’d like to give special thanks to the NYPD and the officers on this case – especially the undercover officer, who displayed extreme bravery by repeatedly engaging with the defendants to take over 50 guns off the street, and to the DEA and Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), for their work on this case. I’d also like to thank the team from my Office who have worked tirelessly to protect our community.

I’ll now turn it over to NYPD Commissioner Sewell.

Prosecution Is First In New York To Publicly Charge the Gun Trafficking Provisions of The Bipartisan Safer Communities Act

Earlier today, at the federal courthouse in Brooklyn, a seven-count indictment was unsealed charging David Mccann, Tajhai Jones, Raymond Minaya, and Calvin Tabron with allegedly conspiring to illegally traffic more than 50 firearms.  Mccann and Minaya are also charged with conspiracy to distribute and possess with intent to distribute cocaine base; Mccann is additionally charged with conspiracy to distribute and possess with intent to distribute fentanyl.  Mccann, Jones, Minaya, and Tabron were arrested this morning.  Mccann and Minaya are scheduled to be arraigned this afternoon before United States Magistrate Judge Taryn A. Merkl. Jones and Tabron will be arraigned in Virginia.

Breon Peace, United States Attorney for the Eastern District of New York, Keechant L. Sewell, Commissioner, New York City Police Department (NYPD) and Frank A. Tarentino, III, Special Agent in Charge, Drug Enforcement Administration (DEA), New York Division announced the charges.

“As alleged, the defendants are responsible for attempting to flood the streets of Brooklyn with over 50 deadly weapons, including ghost guns, as well as narcotics, feeding the cycles of gun violence and drug abuse,” stated United States Attorney Peace.  “As the first prosecution utilizing new federal legislation in New York, and one of the first in the country, these arrests demonstrate this Office’s commitment to utilize all tools available to more effectively stop gun traffickers from endangering our community.”

DEA Special Agent in Charge Frank Tarentino said: “This groundbreaking legislation is intended to address the sobering reality of the link between guns and drugs; the two biggest public safety threats in New York.  DEA New York and our law enforcement partners are aggressively taking every step to protect communities from gun violence and drug trafficking in order to save lives. I commend the NYPD, ATF and the U.S. Attorney’s Office for the Eastern District of New York on their diligent efforts and collaboration throughout this investigation.” 

“This case, initiated in direct response to complaints from the New Yorkers we serve, underscores some disturbing truths,” stated NYPD Commissioner Keechant L. Sewell.  “First, that illegal guns proliferate and circulate in many neighborhoods that still need our help. And second, that every day the women and men of the New York City Police Department perform incredibly dangerous work to prevent these firearms from getting into criminals’ hands.  I commend and thank the NYPD undercover officer who so successfully worked this long-term investigation, all of the detectives with our Violent Crimes Squad, and our invaluable partners at the ATF, the DEA, and the U.S. Attorney’s Office for the Eastern District of New York for their critical work in helping to get these guns – and these gun traffickers – off our streets.”

As alleged in the indictment and court documents, the defendants engaged in multiple transactions involving the sale of at least 50 illegal firearms in Brooklyn between January 2022 and August 2022.  The defendants sold these firearms in broad daylight from vehicles in and around New York City Housing Authority’s Breukelen Houses, which are located across the street from a church and blocks away from a preschool and grade school in Canarsie, Brooklyn.  The defendants would often carry the guns they trafficked in whatever they could find, including gloves and shopping bags.

Two members of the gun-trafficking operation obtained the firearms in Virginia and then transported them to New York to be sold on the streets of Brooklyn.  Some of the firearms had defaced serial numbers or were made from ghost gun kits, making them harder for law enforcement to trace.  Two defendants also engaged in significant narcotics trafficking conspiracies, including a fentanyl distribution conspiracy that introduced thousands of lethal doses of fentanyl into our community. 

The defendants sold the guns and drugs to an undercover officer who recorded many of the transactions.  The undercover officer told the defendants that he was a drug dealer who needed guns and that he was also going to resell some of the guns that were provided to him.  Despite this knowledge, the conspirators continued to sell large quantities of drugs and guns to the undercover officer without hesitation.

Firearms sold in the conspiracy have also been linked to several shootings in Brooklyn.  For example, on June 22, 2022, Minaya sold an undercover officer a Glock 30, .45 caliber handgun.  The investigation revealed that this gun was used in an August 16, 2021 shooting in Bedford-Stuyvesant, during which armed perpetrators shot into a large crowd gathered for a family day celebration.  In total, eight individuals were struck by gunfire.  Another gun trafficked by the conspirators—a Glock 43, 9-millimeter caliber handgun—is linked to a December 18, 2021 shooting of an individual in Canarsie, in the blocks surrounding the Breukelen Houses complex.  That individual sustained multiple gunshot wounds to his body, including his right hand, shoulder, neck, and the base of his skull.

When agents arrested Minaya in Brooklyn this morning, he was in illegal possession of two handguns, including one with an extended magazine.  The defendant threw one of the guns out a window in an attempt to hide it; both guns were recovered.

This prosecution is the first in New York, and among the first in the country, to charge the gun trafficking provisions of the Bipartisan Safer Communities Act, which Congress and the President enacted in June 2022.  The Act is the first federal statute specifically designed to target gun trafficking.  Among other provisions, it creates a standalone firearm trafficking conspiracy offense, which the government has charged in this case to hold accountable those who conspire to illegally sell firearms.  The Act provides for sentences of up to 15 years’ imprisonment.

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

The government’s case is being handled by the Office’s International Narcotics and Money Laundering and General Crimes sections.  Assistant United States Attorneys Adam Amir, Irisa Chen, and James Simmons are in charge of the prosecution with assistance from Paralegal Specialist Abiodun Ojo.  The joint investigation was conducted by the Detective Borough Brooklyn South Violent Crimes Squad, under the supervision of Captain Genienne King and Deputy Chief Joseph Gulotta, who is the Commanding Officer of Detective Borough Brooklyn South, and under the overall supervision of NYPD Chief of Detectives James W. Essig.

The Defendants:

David Mccann
Age:  28
Brooklyn, New York

Tajhai Jones
Age:  28
Portsmouth, Virginia

Raymond Minaya
Age:  26
Brooklyn, New York

Calvin Tabron
Age:  25
Virginia Beach, Virginia

E.D.N.Y. Docket No. 23-CR-8

Earlier today, at the federal courthouse in Brooklyn, Senior United States District Judge Edward R. Korman sentenced Wafa Abboud to a term of imprisonment of 33 months.  As part of the sentence, Judge Korman also ordered Abboud to forfeit $836,000 and pay $1,415,000 in restitution to Human First, Inc. (Human First), the nonprofit agency that Abboud led for more than five years.  Abboud was convicted following a two-week jury trial in July 2019 of theft from programs receiving federal funds, bank fraud, and conspiracies to commit those crimes.  

Breon Peace, United States Attorney for the Eastern District of New York, announced the sentence.

“Stealing taxpayer money earmarked for developmentally disabled youth to pay for vacations, cosmetic surgery, and luxurious vacations is shameful,” stated United States Attorney Peace.  “Today, the defendant has been held accountable for betraying the most vulnerable among us whom she was entrusted to serve and treating the non-profit organization bank accounts as though they were her own.”

Mr. Peace thanked the Federal Bureau of Investigation, New York Field Office, for its investigative work on the case.

From January 2011 until her termination on May 27, 2016, Abboud was the Executive Director of Human First, a non-profit corporation that provided services to individuals with autism and other developmental disabilities. In that capacity, Abboud exercised nearly complete control over the charity’s finances.  During Abboud’s tenure, Human First received tens of millions of dollars annually from the New York State Office for People with Development Disabilities, which is funded in significant part by the Medicaid program.  The money was disbursed to Human First to support its mission of providing residential, rehabilitative, and other services to developmentally disabled youth. 

Abboud entered into an agreement with co-defendant Marcelle Bailey whereby Abboud caused Human First to pay Bailey’s company MPB Management Services LLC (MPB) approximately $16,000 per month in purported “consulting” fees.  Bailey deposited approximately half of each monthly disbursement into bank accounts that were controlled by Abboud, who used the money to fund a lavish lifestyle, including expensive international vacations, visits to luxury spas and high-end beauty salons and restaurants, and elective cosmetic surgeries.  Abboud also withdrew approximately $120,000 from the accounts in cash and wired tens of thousands of dollars in the account overseas. In total, Abboud stole approximately $420,000 between May 2011 and February 2016 through the MPB embezzlement scheme. 

Abboud also conspired with co-defendant Rami Taha to steal over $400,000 through a scheme in which Abboud deliberately issued overpayments to contractors performing work on Human First properties with the knowledge that the overpayment would be kicked back to her.  The overpayments were disguised through the use of inflated invoices submitted to Human First, and the payments to Abboud were hidden by transferring the funds through a number of sham bank accounts before ultimately depositing them into accounts controlled by Abboud.  Abboud used the stolen money to finance the down payment and renovation of her residence.  To conceal the true source of the funds, Abboud lied to her mortgage lender, falsely claiming that the funds were a settlement payment she had received for damage caused to her previous home. 

Bailey pleaded guilty to embezzlement and bank fraud in December 2017 and was sentenced by Judge Korman in August 2021 to 33 months in prison.  Taha pleaded guilty in May 2019 to embezzlement.  A fourth defendant, Arkadiusz Swiechowicz, pleaded guilty to obstruction of justice in September 2018.  Taha and Swiechowicz are awaiting sentencing. 

The government’s case is being handled by the Office’s Public Integrity Section.  Assistant United States Attorneys Robert Polemeni and Turner Buford are in charge of the prosecution.  Assistant United States Attorney Tanisha Payne of the Office’s Asset Recovery Section is handling forfeiture matters in the case. 

The Defendant:

WAFA ABBOUD
Age:  55
Merrick, NY

E.D.N.Y. Docket No. 16-CR-396 (ERK)

Leonardo Jimenez-Rodriguez was extradited to the United States yesterday and is scheduled to be arraigned today before United States Magistrate Judge Ramon E. Reyes, Jr., at the federal courthouse in Brooklyn on a six-count indictment charging him with sex trafficking conspiracy, sex trafficking, interstate prostitution, alien smuggling and related offenses.  The defendant was arrested in May 2022 in Mexico following a joint investigation by Homeland Security Investigations (HSI) Mexico City, HSI New York and the Mexican Federal Police. 

The defendant is charged in a superseding indictment together with his brother and co-defendant, Marcos Jimenez-Rodriguez, who was previously arrested in the United States.  The defendant’s sister, Melisa Jimenez-Rodriguez, was also previously arrested in the United States and is awaiting sentencing on the charge of distributing proceeds of a prostitution business.   

The extradition and charges were announced by Breon Peace, United States Attorney for the Eastern District of New York, and Ivan J. Arvelo, Special Agent-in-Charge, HSI New York.  

“As alleged, using false promises of love and support, the defendant and his siblings brutally sex trafficked women between Mexico and the United States for over two decades,” stated United States Attorney Peace.  “Stopping human trafficking and ensuring that traffickers face justice for the crimes against their victims remain priorities of this Office and our law enforcement partners.”

Mr. Peace commended HSI New York’s Trafficking in Persons Unit for leading the investigation of the Jimenez-Rodriguez Sex Trafficking Organization; thanked the HSI Mexico City Attaché Office, the Department of Justice’s Office of International Affairs, the State Department, Interpol, International Affairs Department of the Attorney General’s Office in Mexico, the Law Enforcement Unit of the State of Tlaxcala Attorney General’s Office, Interpol Mexico, and the New York City Police Department (NYPD) for their assistance; and praised the government of Mexico for its role in advancing bilateral anti-trafficking enforcement efforts.  Mr. Peace also acknowledged the non-governmental victim service providers and advocates for their dedicated efforts to restore and improve the lives of survivors of trafficking and their families.

“Yesterday’s extradition is the result of years of extraordinary collaboration between law enforcement agencies spanning multiple countries and investigative jurisdictions.  Leonardo Jimenez-Rodriguez is alleged to have been a part of his family’s transnational human trafficking organization which offered the chance at a better life to young women and girls before cruelly ensnaring them in forced sex work with no way to return home,” stated HSI Special Agent-in-Charge Arvelo.  “HSI is grateful to our colleagues with the HSI Mexico City Attaché Office and to our many partners in the United States and the Government of Mexico whose collaboration and teamwork make investigations like this possible.”

As alleged in the superseding indictment and other court filings, between 1997 and May 2018, Leonardo Jimenez-Rodriguez was a member of a family organization based in New York and Tenancingo, Mexico, that used force, fraud and coercion to cause young women in Mexico to engage in prostitution in the United States (the “Jimenez-Rodriguez Trafficking Organization”).  Leonardo Jimenez-Rodriguez, together with other relatives, lured victims into romantic relationships through false promises of love and support and pressured the victims to travel to the United States with promises of a better life.  After Leonardo Jimenez-Rodriguez and other members of the Jimenez-Rodriguez Trafficking Organization illegally smuggled young women from Mexico into the United States, they employed brutal physical beatings, intimidation, psychological abuse, and threats to force or attempt to force the women to work as prostitutes in New York City and elsewhere. The defendant is also charged with distributing the illicit proceeds of the sex-trafficking and prostitution enterprise.

The charges in the indictment are allegations, and the defendant is presumed innocent unless and until proven guilty.  If convicted of the sex-trafficking related charges, the defendant faces a mandatory minimum sentence of 15 years’ incarceration and a maximum sentence of life in prison.

The investigation, prosecution, bilateral enforcement action and extradition of the defendants apprehended in Mexico were coordinated through the U.S.-Mexico Bilateral Human Trafficking Enforcement Initiative.  Since 2009, the Departments of Justice and Homeland Security have collaborated with Mexican law enforcement counterparts in a Bilateral Human Trafficking Enforcement Initiative to more effectively dismantle human trafficking networks operating across the U.S.-Mexico border, bring human traffickers to justice, restore the rights and dignity of human trafficking victims and reunite victims with their children.  These efforts have resulted in successful prosecutions in both Mexico and the United States, including U.S. federal prosecutions of over 175 defendants in multiple cases in Georgia, New York, Florida and Texas, in addition to numerous Mexican federal and state prosecutions of associated sex traffickers.  The extradition in this case is also the latest development in the Eastern District of New York’s comprehensive anti-trafficking program, which has to date indicted more than 100 defendants for sex trafficking; assisted nearly 200 victims, including over 50 minors, reunited 19 victims’ children with their mothers, and secured restitution orders of over $4 million on behalf of trafficking victims.

The government’s case is being handled by the Office’s Civil Rights Unit.  Assistant United States Attorneys Erin M. Reid, Gillian Kassner, Tara B. McGrath, and Lauren Bowman are in charge of the prosecution, with assistance from Paralegal Specialist Ryan Costley.

The New Defendant:

LEONARDO JIMENEZ-RODRIGUEZ
Age:  39
Mexico

Defendant Previously Arrested:

MARCOS JIMENEZ-RODRIGUEZ
Age:  46
Queens, New York    

MELISA JIMENEZ-RODRIGUEZ
Age:  41
Queens, New York

E.D.N.Y. Docket No. 21-CR-11 (S-1) (EK)

Earlier today, in federal court in Central Islip, Lawrence Isen, a former registered broker who participated in a criminal conspiracy to promote and manipulate the price of shares in publicly traded companies, was sentenced by United States District Judge Joanna Seybert to 5 years’ imprisonment for conspiracy to commit securities fraud, securities fraud, conspiracy to commit wire fraud, money laundering conspiracy, and money laundering.  The Court also ordered Isen to pay over $8 million in restitution and over $700,000 in forfeiture.  Isen and co-defendant Jeffrey Chartier were convicted of the charges by a federal jury in March 2020 following a six-week trial.  Chartier was sentenced in December 2022.

Breon Peace, United States Attorney for the Eastern District of New York, and Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation (FBI), New York Field Office, announced the sentence.

“Lawrence Isen and his co-conspirators used their skills to steal precious savings from elderly, hard-working people all over the country,” stated United States Attorney Peace.  “Today’s sentence should serve as yet another reminder to fraudsters who prey on the vulnerable that this Office will hold them accountable for the damage they cause to the security and well-being of so many.”

Mr. Peace also thanked the Federal Bureau of Investigation, New York Field Office, for its hard work and dedication in leading the investigation, and expressed his appreciation to the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority, Inc., Criminal Prosecution Assistance Group (FINRA CPAG), for their cooperation and assistance.

From 2014 to 2016, Isen, Chartier and others working with a Melville, New York-based boiler room artificially inflated the price and trading volume of stock in struggling companies with poor prospects, and off-loaded it onto unsuspecting victims who were often elderly and vulnerable. 

The evidence at trial showed that Isen colluded with crooked investors, both in the United States and overseas, to dump large volumes of shares in Hydrocarb Energy Corp., trading under the ticker symbol HECC, and Intelligent Content Enterprises, Inc., trading under the ticker symbol ICEIF, on the victims.  Isen, who was barred from acting as a broker by FINRA in 1996 and convicted of wire fraud conspiracy and obstruction of justice in the Southern District of New York in 2000, orchestrated the manipulation of stock belonging to, among others, major HECC shareholder Michael Watts and major ICEIF shareholders located in India.  He did so by, among other things, connecting the investors with the boiler room; negotiating the terms of the arrangements between them; and managing the relationships between them.  Isen assisted the boiler room in its illegal cold call campaigns that used lies and high-pressure sales tactics to lure victims, by, among other things, transferring money and stock required by the boiler room for the campaigns; working with the boiler room to fill the duped victims’ orders with Isen’s crooked investors’ stock; and creating fraudulent stock purchase agreements, consulting agreements and invoices to cover up the illegal conduct. 

The government has calculated that the conspiracy’s market manipulation fraudulently inflated the stock price of HECC, ICIEF and three other companies by more than $147 million.  All 16 defendants charged in this case have been convicted. 

Assistant United States Attorneys Whitman G.S. Knapp and Kaitlin T. Farrell are in charge of the prosecution with assistance from Paralegal Specialist Peyton Jefferson.  Assistant United States Attorney Tanisha Payne of the Office’s Asset Recovery Section is handling forfeiture matters in the case. 

The Defendant:

LAWRENCE ISEN
Age: 69
San Diego, California

Defendant Previously Sentenced:

JEFFREY CHARTIER
Age: 59
Sunny Isles, Florida

Docket No. 17-CR-372 (JS)

Later today, Jo-Andy Christepher Marie Balentina, Joell Charles Marie Balentina, Sheriann Ann Marie Bryan, Leon George Hall, and Edlyson Reuel Elias Sophia will be arraigned at the federal courthouse in Brooklyn on international cocaine distribution conspiracy and related cocaine importation charges.  Jo-Andy Balentina is also charged with money laundering conspiracy for his role in laundering the proceeds of cocaine sales generated by the trafficking.  

The defendants were extradited from Curacao on January 5, 2023.  The United States submitted requests for their provisional arrests based on the warrants issued in the Eastern District of New York.  A sixth defendant, Israel Osial Barrett, also known as “English,” was arrested in the United Kingdom on a provisional arrest warrant and the government is currently seeking his extradition.

Breon Peace, United States Attorney for the Eastern District of New York, and Ivan J. Arvelo, Special Agent in-Charge, Homeland Security Investigations, New York (HSI), announced the extraditions and arraignments.

“The defendants operated an international drug trafficking enterprise that for years funneled over one hundred kilograms of cocaine into the United States onboard cruise ships and commercial airliners, using an extensive network of corrupt airport employees,” stated United States Attorney Peace.  “This Office and our law enforcement partners will continue to identify, investigate and prosecute narcotrafficking organizations that not only flood our streets with dangerous drugs, but also corrupt and compromise airport security.” 

Mr. Peace extended his appreciation to the United States Drug Enforcement Administration, the United States Marshals Service, the Department of Justice’s Office of International Affairs, and the United States Department of State for their assistance, as well as to law enforcement authorities in Curaçao including the Curaçao Openbaar Ministerie (Public Prosecutor’s Office) and Korps Politie Curaçao (Police Force) who provided significant cooperation.

“As alleged, these individuals have created and led an elaborate network of traffickers and collaborators who used their access to secure areas at airports and on cruise ships to move massive amounts of cocaine into the United States.  Today’s arraignments move us one step closer to the dismantlement of this criminal organization responsible for flooding our streets with cocaine while lining their pockets with the proceeds,” stated HSI Special Agent-in-Charge Arvelo.  “HSI, along with our partners, is committed to leveraging our international footprint and customs law authorities to disrupt the flow of dangerous drugs into our communities and dismantling the drug trafficking organizations who peddle in this poison.”

As set forth in the indictment, court filings and statements made in Court, the defendants are all leaders, members or associates of a Curaçao-based drug trafficking organization (the Curaçao DTO) responsible for importing large shipments of cocaine into the United States, and laundering illicit funds derived from their narcotrafficking activities and sales in the United States back into Curaçao.  The defendants and the Curaçao DTO transported cocaine from Curaçao to the United States by various methods, including commercial airliners and cruise ships.

Since at least early 2017, Jo-Andy Balentina was the principal leader of the Curaçao DTO.  Organization members including Bryan, Hall and Sophia, were responsible for recruiting, training and managing other individuals as couriers to transport and accompany cocaine shipments on the commercial aircraft and cruise ships.  The Curaçao DTO also utilized corrupt airport employees at Curaçao/Hato International Airport in Curaçao, specifically Joell Balentina, and at John F. Kennedy International Airport in Queens to exploit their security clearances and to facilitate the loading and unloading of cocaine shipments and bulk cash on commercial aircraft and bypass airport security and customs.  As a result of the investigation, law enforcement authorities identified or intercepted multiple large-scale shipments of cocaine coming into the United States.

Once the cocaine arrived in the United States, it was smuggled out of the airport or seaport and sold by or on behalf of the Curaçao DTO either directly, or through established distribution networks.  In turn, the proceeds were laundered from the United States back to Jo-Andy Balentina and the Curaçao DTO. As a result of this investigation, federal authorities have dismantled the United States-based network of corrupt airport employees and thwarted the planned importation of an additional 300 kilograms of cocaine to be supplied by the Curaçao DTO.

The charges in the indictment are allegations, and the defendants are presumed innocent unless and until proven guilty.  If convicted, the defendants face up to life in prison.

The government’s case is being handled by the Office’s International Narcotics and Money Laundering Section.  Assistant United States Attorneys Jonathan P. Lax, Andrew D. Grubin and Robert M. Pollack are in charge of the prosecution.  Assistant United States Attorney Brendan G. King of the Office’s Asset Recovery Section is handling forfeiture matters in the case.  The Department of Justice’s Office of International Affairs provided substantial assistance in securing the arrests and extraditions of the defendants.

This effort is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.

The Defendants Being Arraigned Today:

JO-ANDY CHRISTEPHER MARIE BALENTINA (also known as “Enchi,” “Angie” and “Benzy”)
Age: 36
Curaçao

JOELL CHARLES MARIE BALENTINA
Age: 39
Curaçao

SHERIANN ANN MARIE BRYAN (also known as “Sheryl” and “Sharon”)
Age: 39
Curaçao

LEON GEORGE HALL (also known as “Bunny”)
Age: 53
Curaçao

EDLYSON REUEL ELIAS SOPHIA (also known as “Primu”)
Age: 36
Curaçao

The Defendant Awaiting Extradition:

ISRAEL OSIAL BARRETT (also known as “English”)
Age: 51
Birmingham, United Kingdom

E.D.N.Y. Docket No. 21-CR-222 (ARR)

An indictment was unsealed today in federal court in Brooklyn, New York, charging Karin Robinson, a former correction officer employed by the New York City Department of Correction (DOC), with conspiracy to violate the Travel Act and conspiracy to distribute controlled substances to an inmate incarcerated at the George R. Vierno Center at Rikers Island (GRVC) between February and June 2019.  The initial appearance of the defendant is scheduled for this afternoon before United States Magistrate Judge James R. Cho.

Breon Peace, United States Attorney for the Eastern District of New York and Michael J. Driscoll, Assistant Director-In-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the charges.

“The corruption of correction officers undermines the orderly running of the institution and endangers the safety of other incarcerated individuals and Department of Correction personnel,” stated United States Attorney Peace. “We will continue to prosecute those who enrich themselves instead of serving the public and work with our federal and local law enforcement partners to stop the flow of illegal narcotics and other contraband into correctional facilities.”

Mr. Peace thanked the New York City Department of Investigation for their outstanding investigative work on the case.

“As alleged in this indictment, Robinson broke her oath of duty as a correction officer when she agreed to accept bribes and smuggle contraband into the prison system.  The FBI and our law enforcement partners will continue to pursue those who betray the public trust by abusing their authority and bring them to justice as swiftly as possible,” stated FBI Assistant Director-in-Charge Driscoll.

As set forth in the indictment and other court filings, the defendant was a New York City DOC employee in 2019.  Between February and June of 2019, she received thousands of dollars in bribes from a GRVC inmate.  In exchange for the bribe payments, the defendant agreed to bring marijuana and other contraband into the GRVC for sale and distribution to other inmates.   

The charges in the indictment are allegations, and the defendant is presumed innocent unless and until proven guilty.  If convicted, Robinson faces a maximum jail time of 10 years.

The government’s case is being handled by the Office’s Public Integrity Section.  Assistant United States Attorneys Laura Zuckerwise, Joy Lurinsky, and Andrew D. Reich are in charge of the prosecution with the assistance of Paralegal Specialist Rachel Friedman.

The Defendant:

KARIN ROBINSON 
Age:  29
Queens, New York

E.D.N.Y. Docket No. 22-CR-555 (AMD)

A criminal complaint was unsealed today in federal court in Brooklyn charging Aurelien Michel, a French national residing in the United Arab Emirates (UAE), with defrauding purchasers of “Mutant Ape Planet” NFTs, a type of digital asset, of more than $2.9 million in cryptocurrency.  The defendant was arrested last night at John F. Kennedy International Airport.  His initial appearance is scheduled for this afternoon before United States Magistrate Judge James R. Cho. 

As part of the scheme, NFTs were marketed to purchasers, who were falsely promised numerous rewards and benefits designed to increase demand for, and the value of, their newly acquired NFTs.  After selling out of the NFTs, the purchasers were “rug pulled” – a cryptocurrency scam in which a developer attracts investors, but pulls out before the project is complete, leaving buyers with a worthless asset – as none of the promised benefits were provided.  Instead, millions worth of the NFT purchasers’ cryptocurrency was diverted for Michel’s personal benefit. 

Breon Peace, United States Attorney for the Eastern District of New York, Ivan J. Arvelo, Special Agent-in-Charge, Homeland Security Investigations (HSI), New York and Thomas Fattorusso, Acting Special Agent-in-Charge, Internal Revenue Service-Criminal Investigation, New York (IRS-CI), announced the charges.

“As alleged, the defendant used a traditional criminal scheme to defraud consumers eager to participate in a new digital asset market,” stated United States Attorney Peace.  “Protection from fraud and manipulation extends to all consumers and investors, including those participating in the fast-evolving market for NFTs and other crypto assets.  Our Office is committed to bringing to justice any criminal actor abusing any markets for their own gain.”

“As alleged, Aurelien Michel perpetrated a ‘rug pull’ scheme - stealing nearly $3 million from investors for his own personal use. Purchasers of Mutant Ape Planet NFTs thought they were investing in a trendy new collectible, but they were deceived and received none of the promised benefits,” said Ivan J. Arvelo, Special Agent in Charge of Homeland Security Investigations (HSI) in New York. “HSI uses our extensive experience investigating financial crime in conjunction with our cutting edge cyber capabilities to uncover fraud and bring the perpetrators to justice.”

“It’s alleged that Michel defrauded investors by making false representations of, amongst other things, giveaways, tokens with staking features, and merchandise collections.  Once the NFTs were sold-out, Michel allegedly ceased communications and withdrew purchasers’ funds from the company’s cryptocurrency wallets, lining his pockets with nearly $3 Million of investors’ money,” stated IRS-CI Fattorusso.  “Michel can no longer blame the NFT community for his criminal behavior.  His arrest means he will now face the consequences of his own actions.”

As alleged in the criminal complaint, Mutant Ape Planet NFTs were a digital asset stored on the Ethereum blockchain.  As an NFT, each Mutant Ape Planet NFT was unique, freely transferrable, and gave purchasers exclusive ownership over each NFT.  The NFTs were marketed with promises of exclusive benefits potential purchasers would receive.  Those benefits included exclusive opportunities for additional investments, giveaways, merchandise, and other rewards.  However, after sending their cryptocurrency and obtaining the NFT, purchasers received nothing while their cryptocurrency was diverted from the Mutant Ape Planet NFT project to cryptocurrency wallets controlled by the defendant Aurelien Michel.  In total, more than $2.9 million in purchasers’ cryptocurrency was diverted as part of the Michel’s scheme. 

As alleged, in a social media chat with current and prospective purchasers, Michel admitted to the fraudulent “rug pull,” but blamed the community of NFT purchasers for his actions, stating, “We never intended to rug but the community went way too toxic.”

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

The government’s case is being prosecuted by Assistant United States Attorneys Drew Rolle and Dylan Stern of the Office’s Business and Securities Fraud Section with assistance from Paralegal Specialist William Daniels.

If you believe that you have been a victim of this crime, please call the HSI Tip Line at 1-866-347-2423.

The Defendant:

AURELIEN MICHEL
Age:  24
Dubai, United Arab Emirates

E.D.N.Y. Docket No. 23-MJ-7

Earlier today, in federal court in Central Islip, Morris Barnard, a gastroenterologist practicing in Great Neck, New York, was sentenced by United States District Judge Gary R. Brown to 30 months in prison for health care fraud. Barnard pleaded guilty to the charge in March 2022.  The Court also ordered over $1.4 million in restitution to Medicare. 

Breon Peace, United States Attorney for the Eastern District of New York and Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI) and Susan A. Frisco , Acting Special Agent-in-Charge, U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG), announced the sentence.

“Today, Dr. Barnard learned the consequences for his greed-driven scheme in which he took advantage of patients who are disabled and living in residential group homes by falsely billing Medicare for medical procedures on them that he never actually performed,” stated United States Attorney Peace.  “The defendant was not entitled to one penny of the $1.4 million in precious public health care funds that he pocketed and will now have to pay back as part of his sentence.” 

“As the defendant learned today, defrauding Medicare does not pay - it has consequences.  The FBI is committed to eradicating all fraud and schemes that abuse government-sponsored health care programs,” stated FBI Assistant Director-in-Charge Driscoll.

“Health care professionals who fraudulently bill Medicare for services never actually provided divert taxpayer funding meant to pay for medically necessary services for people enrolled in Medicare,” stated Acting Special Agent in Charge Susan A. Frisco of HHS-OIG. “OIG will continue to work with our law enforcement partners to protect the integrity of federal health care programs.”

From October 2015 through February 2020, the defendant submitted over $3 million in billings to Medicare for colonoscopy and gastroenterological procedures that were not performed.  Most of these billings indicated that the services were rendered to disabled beneficiaries, who were living in residential group homes.  Medicare reimbursed approximately $1.4 million of these false claims, none of which the defendant was entitled to receive.

The government’s case is being prosecuted by Assistant United States Attorneys Charles P. Kelly and Madeline O’Connor.

The Defendant:

Morris Barnard
Age:  59
Great Neck, New York

E.D.N.Y. Docket No. 21-018(GRB)

Earlier today, in federal court in Brooklyn, Jaleesa Wallace was sentenced by United States District Judge Carol Bagley Amon to 30 months in prison for postal theft. As part of her sentence, Wallace was also ordered to pay over $4 million in restitution.

Breon Peace, United States Attorney for the Eastern District of New York, and Matthew Modafferi, Special Agent-in-Charge, United States Postal Service, Office of the Inspector General, Northeast Area Field Office (USPS-OIG), announced the sentence.

“The defendant exploited her position with one of our most trusted institutions, the United States Postal Service, for her own personal gain and caused significant losses to financial institutions,” stated United States Attorney Peace.  “Residents of the district need to be confident that postal employees carry out their duties honestly and that important documents can travel safely in the mail.”

Mr. Peace also expressed his thanks to the United States Postal Inspection Service, New York Division, and the New York City Police Department for their diligent efforts on the case. 

“The Special Agents of the USPS OIG will vigorously investigate Postal Service employees who compromise their integrity for personal gain. The sentence imposed on the defendant will serve as a reminder that there are severe consequences when individuals utilize their Postal position to commit crimes,” stated USPS-OIG Special Agent-in-Charge Modafferi. “The U.S. Postal Service, Office of Inspector General would like to thank our law enforcement partners and the Department of Justice for their dedication and efforts in this investigation.”

As set forth in court filings, in February 2021, 10,000 blank money orders were reported missing from a USPS post office on Utica Avenue in Brooklyn where Wallace worked.  The money orders can be deposited with a financial institution for up to $1,000 each.  Agents recovered over 3,000 of the stolen money orders from Wallace’s residence.  Over $4 million worth of the stolen money orders have been cashed at various financial institutions throughout the country. Agents also recovered prepaid Department of Labor unemployment benefit cards and approximately $43,000 in cash from Wallace’s apartment. Additionally, Wallace was in possession of approximately 42 pieces of mail from the Department of Labor that were not in her name. 

Wallace was terminated by the USPS in August 2021. She forfeited the cash seized from her apartment to the United States Postal Inspection Service. A related defendant, Willie Cook, pleaded guilty to mail theft in March 2022 and is awaiting sentencing.

The government’s case was handled by the Office’s General Crimes Section. Assistant United States Attorney Samantha Alessi is in charge of the prosecution.

The Defendant:

JALEESA WALLACE
Age: 31
Brooklyn, New York

E.D.N.Y. Docket No. 22-CR-153 (CBA)

Frank James, 63, of Milwaukee, Wisconsin, pleaded guilty today to 10 counts of committing a terrorist attack or other violence against a mass transportation vehicle – one count for each gunshot victim – and one count of discharging a firearm in furtherance of his attack. The charges relate to the defendant’s April 12, 2022, mass shooting on the New York City subway in Sunset Park, Brooklyn.

According to court documents, during rush hour on the morning of April 12, 2022, James used a Glock 17 pistol he legally purchased in Ohio to conduct a mass shooting on an N subway train in Brooklyn, New York. As part of his attack, James – disguised in an orange reflective jacket and yellow hard hat to look like a Metropolitan Transportation Authority (MTA) employee – set off a smoke-emitting device in a subway car before opening fire on his captive victims. The smoke-emitting device caused panicked passengers to scramble to one end of the subway car, allowing James to more easily shoot at his victims. In total, 10 victims were struck by the defendant’s bullets. Even more passengers suffered from smoke inhalation and other mental and physical injuries due to the defendant’s attack.

“As described in court filings, the defendant set off a smoke bomb in a New York City subway car and then fired a handgun more than 30 times, striking ten innocent passengers,” said Attorney General Merrick B. Garland. “Today’s guilty plea demonstrates that the Justice Department will work relentlessly to hold accountable those who engage in mass violence and terrorize our communities.”

“On the morning of April 12, 2022, Frank James cold-bloodedly shot innocent New Yorkers traveling on the subway in Brooklyn and brought terror to our great city. James’s crimes of violence have been met with swift justice,” said U.S. Attorney Breon Peace for the Eastern District of New York. “James’s admission of guilt to all eleven counts of the superseding indictment acknowledges the terror and pain he caused. This guilty plea is an important step towards holding James fully accountable and helping the victims of the defendant’s violence and our great city heal.”

“Frank James, as he admitted today, deliberately planned and carried out an attack of terror on everyday New Yorkers. The FBI's JTTF and our law enforcement partners remain ever vigilant in our efforts to protect our city, and we will ensure those willing to commit acts of terror face the consequences of their actions,” said Assistant Director in Charge Michael J. Driscoll of the FBI New York Field Office.

“Today’s guilty plea is a distinct admission of the terror Mr. James inflicted on New Yorkers last April in Brooklyn, and he is being held accountable for his reprehensible actions that morning,” said Commissioner Keechant L. Sewell of New York City Police Department (NYPD). “Our nation’s largest transit system is the lifeblood of New York City. And its subway riders expect and deserve the brisk, coordinated, and meticulous work exhibited by everyone involved in bringing this terrible incident to a successful close. For their unwavering dedication to all the people we serve, I thank and commend the NYPD patrol officers who arrested Mr. James on the run, as well as each of the detectives and agents assigned to the Joint Terrorism Task Force who methodically shrunk his world until he had nowhere else to turn. Lastly, I also want to thank the public for their vigilance and their help in taking this violent criminal off of our streets.”

The investigation reflects that the attack was the culmination of substantial planning. Beginning as early as 2017, James began purchasing items he could use in an attack, including smoke grenades, ammunition, weapons, and his disguise. In the months leading up to his attack, James conducted web searches for “MTA,” “New York,” “transit,” “stops on the N train,” and “311 kings highway brooklyn ny,” which is near where James parked his rented U-Haul van before entering the subway. The defendant also recorded and posted videos online foreshadowing his plans, including stating that “if you hear the name Frank James on the news, if something happens to a Frank James that’s sixty-something years old, chances are that’s me.”

Following James’s attack, law enforcement officers searched James’s apartment and storage unit and uncovered a stockpile of weapons, including, among other items, 9mm ammunition; a threaded 9mm pistol barrel, which allows for a silencer or suppresser to be attached; .223 caliber ammunition, which is used with an AR-15 semi-automatic rifle; a taser; a high-capacity rifle magazine; and a blue smoke cannister.

James faces up to life in prison on each of the 11 counts. A sentencing date has not yet been set.

The FBI’s New York Joint Terrorism Task Force, which principally consists of agents from the FBI and detectives from the NYPD are investigating the case. MTA and ATF provided valuable assistance.

Assistant U.S. Attorneys Ian C. Richardson, Sara K. Winik, and Ellen H. Sise for the Eastern District of New York are prosecuting the case, with valuable assistance provided by Paralegal Specialist Magdalena St. Surin and Trial Attorney David Cora of the National Security Division’s Counterterrorism Section.

Earlier today, in federal court in Brooklyn, Frank James pleaded guilty to 10 counts of committing a terrorist attack or other violence against a mass transportation vehicle—one count for each gunshot victim—and one count of discharging a firearm in furtherance of his attack.  The charges relate to the defendant’s April 12, 2022 mass shooting on the New York City subway in Sunset Park, Brooklyn.  Today’s proceeding was held before United States District Judge William F. Kuntz, II.  When sentenced, James faces up to life in prison on each of the 11 counts.

Merrick B. Garland, United States Attorney General, Breon Peace, United States Attorney for the Eastern District of New York, Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Keechant L. Sewell, Commissioner, New York City Police Department (NYPD), announced the guilty plea.

“On the morning of April 12, 2022, Frank James cold-bloodedly shot innocent New Yorkers traveling on the subway in Brooklyn, and brought terror to our great city.  James’s crimes of violence have been met with swift justice,” stated United States Attorney Peace.  “James’s admission of guilt to all eleven counts of the superseding indictment acknowledges the terror and pain he caused. This guilty plea is an important step towards holding James fully accountable and helping the victims of the defendant’s violence and our great city heal.”

Mr. Peace praised the outstanding efforts of the FBI’s New York Joint Terrorism Task Force, which principally consists of agents from the FBI and detectives from the NYPD in bringing the defendant to justice.  Mr. Peace also thanked the Metropolitan Transportation Authority (MTA) and the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) for their substantial assistance.

“As described in court filings, the defendant set off a smoke bomb in a New York City subway car and then fired a handgun more than 30 times, striking ten innocent passengers,” said Attorney General Merrick B. Garland. “Today’s guilty plea demonstrates that the Justice Department will work relentlessly to hold accountable those who engage in mass violence and terrorize our communities.”

“Frank James, as he admitted today, deliberately planned and carried out an attack of terror on everyday New Yorkers.  The FBI's JTTF and our law enforcement partners remain ever vigilant in our efforts to protect our city, and we will ensure those willing to commit acts of terror face the consequences of their actions,” stated FBI Assistant-Director in Charge Driscoll.

“Today’s guilty plea is a distinct admission of the terror Mr. James inflicted on New Yorkers last April in Brooklyn, and he is being held accountable for his reprehensible actions that morning,” stated NYPD Commissioner Keechant L. Sewell. “Our nation’s largest transit system is the lifeblood of New York City. And its subway riders expect and deserve the brisk, coordinated, and meticulous work exhibited by everyone involved in bringing this terrible incident to a successful close. For their unwavering dedication to all the people we serve, I thank and commend the NYPD patrol officers who arrested Mr. James on the run, as well as each of the detectives and agents assigned to the Joint Terrorism Task Force who methodically shrunk his world until he had nowhere else to turn. Lastly, I also want to thank the public for their vigilance and their help in taking this violent criminal off of our streets.”

According to court filings and facts presented at the plea proceeding, at approximately 8:26 a.m. on April 12, 2022, James used a Glock 17 handgun that he legally purchased in Ohio to conduct a mass shooting on an N subway train in Brooklyn.  As part of his attack, James—disguised in an orange reflective jacket and yellow hardhat to look like an MTA employee—set off a smoke-emitting device in a subway car before opening fire on his captive victims.  The smoke-emitting device caused panicked passengers to scramble to one end of the subway car, allowing James to more easily shoot at his victims.  In total, 10 victims were struck by the defendant’s bullets.  Even more passengers suffered from smoke inhalation and other emotional and physical injuries caused by the defendant’s attack. 

The investigation reflects that the attack was the culmination of substantial planning.  Beginning as early as 2017, James began purchasing items he could use in an attack, including smoke grenades, ammunition, weapons, and his disguise.  In the months leading up to his attack, James conducted internet searches for “MTA,” “New York,” “transit,” “stops on the N train,” and “311 kings highway brooklyn ny,” which is near where James parked his rented U-Haul van before entering the subway.  The defendant also recorded and posted videos online foreshadowing his plans, including stating that “if you hear the name Frank James on the news, if something happens to a Frank James that’s sixty-something years old, chances are that’s me.”

Following James’s attack, law enforcement officers searched James’s apartment and storage unit and uncovered a stockpile of weapons, including, among other items: 9mm ammunition; a threaded 9mm pistol barrel, which allows for a silencer or suppresser to be attached; .223 caliber ammunition, which is used with an AR-15 semi-automatic rifle; a taser; a high-capacity rifle magazine; and a blue smoke cannister.

The government’s case is being handled by the Office’s National Security and Cybercrime Section.  Assistant U.S. Attorneys Ian C. Richardson, Sara K. Winik and Ellen H. Sise are in charge of the prosecution, with assistance from Paralegal Specialist Magdalena St. Surin and Trial Attorney David Cora of the National Security Division’s Counterterrorism Section.

The Defendant:

FRANK JAMES
Age:  63
Milwaukee, Wisconsin

E.D.N.Y. Docket No. 22-CR-214 (WFK)

BROOKLYN, NY – In a civil complaint filed today, the Department of Justice alleges that AmerisourceBergen Corporation and two of its subsidiaries, AmerisourceBergen Drug Corporation and Integrated Commercialization Solutions, LLC (together “AmerisourceBergen”), collectively one of the country’s largest wholesale pharmaceutical distributors, violated federal law in connection with the distribution of controlled substances to pharmacies and other customers across the country, contributing to the prescription opioid epidemic.

The complaint alleges that this unlawful conduct resulted in at least hundreds of thousands of violations of the Controlled Substances Act (CSA). The Justice Department seeks civil penalties and injunctive relief.

“AmerisourceBergen, a wholesale drug distributor, flagrantly and repeatedly violated its obligation to notify DEA of suspicious orders for controlled substances, which directly contributed to the epidemic of prescription opioid abuse across the United States,” stated United States Attorney Peace.

“The Department of Justice is committed to holding accountable those who fueled the opioid crisis by flouting the law,” said Associate Attorney General Vanita Gupta. “Companies distributing opioids are required to report suspicious orders to federal law enforcement. Our complaint alleges that AmerisourceBergen—which sold billions of units of prescription opioids over the past decade—repeatedly failed to comply with that requirement.”

“AmerisourceBergen, one of the largest wholesale distributors of opioids in the world, had a legal obligation to report suspicious orders to the Drug Enforcement Administration, and our complaint alleges that the company’s repeated and systemic failure to fulfill this simple obligation helped ignite an opioid epidemic that has resulted in hundreds of thousands of deaths over the past decade,” said DEA Administrator Anne Milgram. “The men and women of the DEA will stop at nothing to hold accountable registrants that fail to uphold their responsibility of saving American lives by filing suspicious order reports.”

To prevent the unlawful distribution of opioids and other controlled substances, the CSA requires that wholesale drug distributors like AmerisourceBergen report suspicious orders of controlled substances to DEA. An order is suspicious if it has an unusual size, deviates substantially from a normal pattern, has an unusual frequency, or carries other signs that the order is suspicious, such as suspicions about the legitimacy of the customers’ business practices.  

The complaint filed in the U.S. District Court for the Eastern District of Pennsylvania alleges that over the course of nearly a decade, from 2014 through the present, AmerisourceBergen violated the CSA by failing to report at least hundreds of thousands of suspicious orders of controlled substances to the DEA as required by law. The alleged unlawful conduct includes filling and failing to report numerous orders from pharmacies that AmerisourceBergen knew were likely facilitating diversion of prescription opioids.  Today’s filing is the result of a multi-year investigation by the DEA, the Civil Division’s Consumer Protection Branch and several U.S. Attorneys’ Offices.

The government’s complaint specifies several pharmacies for which AmerisourceBergen allegedly was aware of significant “red flags” suggesting the existence of diversion of prescription drugs to illicit markets.  The complaint asserts that AmerisourceBergen nevertheless continued to distribute drugs to the pharmacies for years and reported few suspicious orders to the DEA.  The five examples include: two pharmacies, one in Florida and one in West Virginia, for which AmerisourceBergen knew the drugs it distributed were likely being sold in parking lots for cash; a New Jersey pharmacy that has pleaded guilty to unlawfully selling controlled substances; another New Jersey pharmacy whose pharmacist-in-charge has been indicted for drug diversion; and a Colorado pharmacy that AmerisourceBergen knew was its largest purchaser of oxycodone 30mg tablets in all of Colorado. The government further alleges that for this Colorado pharmacy, AmerisourceBergen specifically identified eleven patients as potential “drug addicts” whose prescriptions likely were illegitimate. Two of those patients subsequently died of overdoses.

The complaint further alleges that AmerisourceBergen not only ignored red flags of diversion, but also relied on internal systems to monitor and identify suspicious orders that were deeply inadequate, both in design and implementation. These systems allegedly flagged only a tiny fraction of suspicious orders, thereby enabling diversion and AmerisourceBergen’s failure to report orders it was legally obligated to identify to the DEA. In fact, the complaint asserts that in the midst of the opioid epidemic, AmerisourceBergen intentionally altered its internal systems in a way that reduced the number of controlled substances reported as suspicious. Even for the small percentage of orders that AmerisourceBergen did identify as suspicious, the company routinely failed to report them to the DEA.

The government’s complaint alleges that for years AmerisourceBergen flouted its legal obligations and prioritized profits over the well-being of Americans.

If AmerisourceBergen is found liable, it could face escalating civil penalties depending on when each violation occurred and the type of controlled substance at issue. Specifically: up to $10,000 for each reporting violation before November 2015, up to $16,864 for each violation between November 2015 and October 2018 and for each violation relating to a suspicious order for a non-opioid controlled substance not reported after October 2018, and up to $109,374 for each violation relating to a suspicious opioid order not reported after October 2018, potentially totaling billions of dollars in penalties. The court also may award injunctive relief to prevent AmerisourceBergen from committing future CSA violations.

The claims made in the complaint are allegations that, if the case were to proceed to trial, the government must prove by a preponderance of the evidence.

The United States is represented in the filed action by Assistant U.S. Attorneys Elliot M. Schachner and Diane Leonardo for the Eastern District of New York, Trial Attorneys Michael Wadden, Amy DeLine, and Deborah Sohn of the Department of Justice Civil Division’s Consumer Protection Branch, Assistant U.S. Attorneys Hayden M. Brockett and Jordann R. Conaboy for the District of New Jersey, Assistant U.S. Attorneys Anthony D. Scicchitano and Landon Jones for the Eastern District of Pennsylvania and Assistant U.S. Attorneys Amanda Rocque and David Moskowitz for the District of Colorado. The DEA collaborated with the Civil Division’s Consumer Protection and the U.S. Attorney’s Offices to investigate the case.

Earlier today in federal court in Brooklyn, Parveg Ahmed was sentenced by United States District Judge Ann M. Donnelly to 153 months’ imprisonment and 15 years supervised release for one count of attempting to provide material support or resources to the Islamic State of Iraq and al Sham (ISIS), a foreign terrorist organization. The defendant pleaded guilty to the charge in June 2018.

Breon Peace, United States Attorney for the Eastern District of New York, Matthew G. Olsen, Assistant Attorney General of the Justice Department’s National Security Division, Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Keechant L. Sewell, Commissioner, New York City Police Department (NYPD), announced the sentence.

“Ahmed nearly fulfilled his goal to join a group of violent terrorists who have killed numerous innocent victims, including American citizens, and expressed that he planned to fight against ‘the West’ if he made it to Syria,” stated United States Attorney Peace.  “Today’s sentence demonstrates that a significant prison sentence is the end result for radicalized individuals pursuing a misguided path of terror and violence.” 

Mr. Peace thanked the FBI’s Joint Terrorism Task Force for its exemplary work on the case.

“The defendant willingly traveled overseas in an attempt to join ISIS so he could participate in the group’s violent acts of terror.  The FBI New York Joint Terrorism Task Force, along with our law enforcement partners, remain unwavering in our commitment to protect the American people.  As today’s sentence should demonstrate to all, we will continue to ensure those wishing to partake in acts of terror face the consequences in the criminal justice system.”

“An American citizen, Ahmed traveled to the Middle East with the sole intention of betraying his own country by taking up arms against it in the name of ISIS,” stated NYPD Commissioner Keechant Sewell. “Identifying and stopping individuals like this before they can harm the United States and our people are the ideals upon which the Joint Terrorism Task Force was established. I commend and thank the investigators from the NYPD, FBI, and all of our partner agencies on the nation’s first JTTF, here in New York City, for their tireless work on this important case.”

As detailed in publicly filed court documents, Ahmed is a United States citizen who traveled to Saudi Arabia in June 2017, purportedly to celebrate an Islamic religious holiday.  Upon his arrival in Saudi Arabia, Ahmed attempted to travel to Syria to join ISIS.  Ahmed was apprehended in a Middle Eastern country during his attempted travel to ISIS-controlled territory.

Previously, Ahmed had repeatedly expressed support on social media for ISIS and for individuals who provided support to the foreign terrorist organization’s mission of violent extremism.  On July 17, 2017, JTTF agents obtained a search warrant for his personal computer, and learned that he had viewed or listened to recordings of radical Islamic clerics Anwar al-Awlaki, a United States-born cleric and prominent leader of the foreign terrorist organization al Qaeda in the Arabian Peninsula, who was killed on or about September 30, 2011, and Abdullah el-Faisal, a Jamaican-born cleric, who was found guilty in the United Kingdom of solicitation to commit murder for preaching to followers to kill individuals, including Americans, because he deemed them to be enemies of Islam.  Ahmed was deported to the United States on August 28, 2017, where he was arrested at John F. Kennedy International Airport.  Subsequent review of electronic devices found in Ahmed’s possession when he was detained attempting to travel to Syria also revealed draft messages explaining that the defendant planned to join ISIS in Syria to wage violent jihad and expressing farewell to the defendant’s family members.  Specifically, a draft message stated “[W]e have made it to Dawlatul Islam [ISIS] in Syria.  In sha Allah [God willing] we will join the Jihad very soon and in Sha Allah [God willing] we will then join the ranks of the Shuhuda [martyrs].  The West has invaded the land of the Muslims and is constantly attacking it.”

The government’s case is being handled by the Office’s National Security & Cybercrime Section.  Assistant United States Attorneys Craig R. Heeren and Meredith A. Arfa are in charge of the prosecution, with assistance from Paralegal Specialist Magdalena St. Surin and Trial Attorney John Cella of the National Security Division’s Counterterrorism Section.

The Defendant:

PARVEG AHMED
Age:  27
Ozone Park, Queens

Earlier today, in federal court in Central Islip, Kevin Rizo was sentenced by United States District Judge Joanna Seybert to 17 years in prison for sexually exploiting a minor.  Rizo will also be required to register as a sex offender upon his release from prison. Rizo pleaded guilty to the charge in September 2021.

Breon Peace, United States Attorney for the Eastern District of New York and Ivan J. Arvelo, Special Agent in-Charge, Homeland Security Investigations, New York (HSI), announced the sentence.

“The defendant’s sextortion is unconscionable and extremely harmful to the young boy who should be commended for bravely coming forward to law enforcement to stop this predator,” stated United States Attorney Peace.  “Today’s substantial prison sentence will protect the community here and elsewhere from Rizo, who trolled the Internet for more than 100 boys to entice and terrorize.  I urge parents and caregivers to have frank conversations with their children about the dangers of communicating online with strangers who can pretend to be anyone or anything while making inappropriate requests for photos and videos.”

“Rizo preyed on children utilizing the internet and social media applications – using fear to extort them to do his bidding.  Sextortion is a growing threat for children online and this significant sentence sends a clear message that those who attempt to exploit and harm children will face serious consequences,” said Ivan J. Arvelo, Special Agent in Charge for Homeland Security Investigations in New York.

In December 2016, a 14-year-old boy and his parents reported to Nassau County police officers that on the night of November 30, 2016 to December 1, 2016, the victim had been contacted by Rizo on Instagram, who was using the moniker “Alyssa,” and pretending to be a teenage girl.  After the victim complied with “Alyssa’s” request to see explicit photographs and videos of the victim, the defendant threatened to share those photographs and videos with the victim’s friends unless the victim provided even more explicit material.  On that same day, several friends of the victim received nude photos of the teen from Rizo. 

The government’s investigation revealed that Rizo had communicated with at least 130 boys and that most of them sent him nude images and videos of themselves at his behest.  After Rizo received the images and videos, he threatened to disseminate them to others, including the boys’ friends and family members, if more images and videos were not sent.

The government’s case is being handled by the Office’s Long Island Criminal Division.  Assistant United States Attorney Oren Gleich is in charge of the prosecution.

The Defendant:

KEVIN RIZO (also known as “Alyssarxx,” “Alysaflxx,” Alyssa.rxx,” and “Ally.love.15”)
Age:  33
Flushing, New York

E.D.N.Y. Docket No. 17-CR-283 (JS)

A New York man was sentenced today to 12 years and nine months in prison followed by 15 years of supervised release for attempting to provide material support or resources to the Islamic State of Iraq and al Sham (ISIS), a foreign terrorist organization.

Parveg Ahmed, 27, of Queens, pleaded guilty to one count of attempting to provide material support or resources to a foreign terrorist organization in June 2018. According to court documents, Ahmed is a U.S. citizen who traveled to Saudi Arabia in June 2017, purportedly to celebrate an Islamic religious holiday. Upon his arrival in Saudi Arabia, Ahmed attempted to travel to Syria to join ISIS.  Ahmed was apprehended in a country bordering Syria during his attempted travel to ISIS-controlled territory.

Previously, Ahmed had repeatedly expressed support on social media for ISIS and for individuals who provided support to the foreign terrorist organization’s mission of violent extremism. On July 17, 2017, law enforcement agents obtained a search warrant for his personal computer, and learned that he had viewed or listened to recordings of radical Islamic clerics Anwar al-Awlaki, a U.S.-born cleric and prominent leader of the foreign terrorist organization al Qaeda in the Arabian Peninsula, who was killed on or about Sept. 30, 2011, and Abdullah el-Faisal, a Jamaican-born cleric, who was found guilty in the United Kingdom of solicitation to commit murder for preaching to followers to kill individuals, including Americans, because he deemed them to be enemies of Islam. Ahmed was deported to the United States on Aug. 28, 2017, where he was arrested at John F. Kennedy International Airport. Subsequent review of electronic devices found in Ahmed’s possession when he was detained attempting to travel to Syria also revealed:

• Messages explaining that the defendant planned to join ISIS in Syria to wage violent jihad and expressing farewell to the defendant’s family members. Specifically, review of his devices revealed a message he composed, but had not yet sent, stating, “[W]e have made it to Dawlatul Islam [ISIS] in Syria. In sha Allah [God willing] we will join the Jihad very soon and in Sha Allah [God willing] we will then join the ranks of the Shuhuda [martyrs]. The West has invaded the land of the Muslims and is constantly attacking it.”

Assistant Attorney General Matthew G. Olsen of the Justice Department’s National Security Division, U.S. Attorney Breon Peace for the Eastern District of New York, Assistant Director Robert R. Wells of the FBI Counterterrorism Division and Assistant Director in Charge Michael J. Driscoll of the FBI New York Field Office made the announcement.

The FBI’s Joint Terrorism Task Force investigated the case.

Assistant U.S. Attorneys Craig R. Heeren and Meredith A. Arfa for the Eastern District of New York prosecuted the case, with valuable assistance provided by the National Security Division’s Counterterrorism Section.

A criminal complaint was unsealed yesterday in federal court in Brooklyn charging Mohammad David Hashimi, 35, of Potomac Falls, Virginia; Abdullah At Taqi, 23, of East Elmhurst, Queens, New York; Khalilullah Yousuf, 34, of Ontario, Canada; and Seema Rahman, 25, of Edison, New Jersey, with conspiring to provide material support to the Islamic State of Iraq and al-Sham (ISIS). Hashimi, Taqi and Rahman were arrested on Dec. 14 in Virginia, New York and New Jersey, respectively. Yousuf was also arrested on Dec. 14 in Canada by Canadian law enforcement pursuant to a provisional arrest request from the United States. Taqi and Rahman made their initial appearances in federal court in Brooklyn before Chief U.S. Magistrate Judge Cheryl L. Pollak. Hashimi made his initial appearance in federal court in Alexandria, Virginia, before U.S. Magistrate Judge Ivan Davis and was ordered detained pending trial.

According to court documents, Hashimi and Yousuf were members of a group chat (referred to in the complaint as Group Chat-1) on an encrypted social media and mobile messaging electronic communication service that facilitated communication between and among supporters of ISIS and other groups that adhered to similar violent jihadist ideologies. In early April 2021, members of Group Chat-1 discussed posting donation links that purported to be for humanitarian causes but that were in fact intended to help the “mujahideen,” an Arabic term that translates to “holy warriors” that is used by ISIS supporters to refer to ISIS fighters. Yousuf provided a link to a specific Bitcoin address and another member of Group Chat-1 posted a link to a PayPal campaign, both of which were controlled by an individual identified in the Complaint as Facilitator-1.

“These defendants promoted the violent extremism of ISIS by pretending to raise money for humanitarian causes only to transfer the funds to cryptocurrency accounts tied to the group,” said Assistant Attorney General Matthew G. Olsen of the Justice Department’s National Security Division. “These arrests show the Justice Department’s unwavering commitment to bringing to justice all those who would help terrorist organization threaten harm to our people.”

“As alleged, this crowdfunding network used cryptocurrency, Bitcoin wallets, GoFundMe and PayPal to collect and raise blood money to support ISIS, not for needy families as they falsely claimed in their attempt to deceive law enforcement,” said U.S. Attorney Breon Peace for the Eastern District of New York. “I commend our prosecutors and the FBI’s New York Joint Terrorism Task Force for piercing the veil of secrecy to identify the perpetrators of this scheme, reveal the true evil nature of these virtual money transfers, and bring to justice those who seek to enable acts of violent extremism.”

“These arrests show the FBI and our partners will not tolerate those who attempt to raise money to fund ISIS or any other terrorist group,” said Assistant Director Robert R. Wells of the FBI’s Counterterrorism Division. “According to the complaint, these individuals allegedly made fundraising appeals for charitable donations to humanitarian causes and did not reveal how they planned to use the money. The FBI will continue to aggressively investigate and hold accountable those who try to assist terrorists.”

In conversations with a confidential source, Taqi and Facilitator-1 discussed giving money to support ISIS fighters. When the confidential source asked Facilitator-1 for proof that the money being donated was going to support ISIS, Facilitator-1 sent the confidential source screenshots and a video depicting tactical gear, ammunition and grenades on top of an ISIS flag. An image of one of the photographs is depicted below.

Facilitator-1 also told the confidential source that the charitable descriptions in the fundraising campaigns were in fact a “deception for the infidels” and the “words that are in the link are fake in order to deceive.” 

Between February 2021 and July 2022, the defendants raised and contributed more than $35,000 to Facilitator-1 via a combination of cryptocurrency and other sources. The defendants contributed more than $24,000 to Facilitator-1’s Bitcoin address, with Yousuf contributing $20,347.89, Taqi contributing $2,769.35 and Rahman contributing $927.51. The defendants also sent more than $1,000 to the PayPal account associated with Facilitator-1, with Rahman contributing approximately $550, Taqi contributing approximately $480 and Hashimi contributing $55. In addition, both Yousuf and Rahman created multiple GoFundMe fundraising campaigns purporting to collect money for charitable causes. Hashimi contributed $364 and Taqi contributed $200 through the Yousuf-created GoFundMe campaigns, while Rahman raised approximately $10,000 through the GoFundMe campaigns that she created, and then wired the proceeds, approximately $10,024, to individuals connected to Facilitator-1 via Western Union.

Hashimi has also made statements suggesting his desire to die in combat or in a terrorist attack on behalf of, a foreign terrorist organization. For example, in November 2020, Hashimi told another confidential source over encrypted communications that “I have made up my mind I want to make Hijra to Afghanistan. To join dawla,” in other words, travel to join ISIS. In or about September 2021, Hashimi told another individual through a direct message that “I just want Jannah,” i.e., paradise or the after-life, “And to die on the battlefield.”

The defendants are each charged with conspiring to provide material support to a foreign terrorist organization, which carries a maximum statutory penalty of up to 20 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

The FBI is investigating the case.

Assistant U.S. Attorneys Douglas M. Pravda, Ian C. Richardson and Nina Gupta for the Eastern District of New York and Trial Attorneys Daniel Gardner and Alexandra Hughes of the National Security Division’s Counterterrorism Section are prosecuting the case.

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