Eastern District of New York

A criminal complaint was unsealed today in federal court in Brooklyn charging John Lhota with the April 3, 2022 arson of Rash, a bar and nightclub in Bushwick frequented by members of the LGBTQ+ community. Lhota was arrested yesterday and will make his initial appearance this afternoon before United States Magistrate Judge Roanne L. Mann.

Breon Peace, United States Attorney for the Eastern District of New York; John B. DeVito, Special Agent-in-Charge, U.S. Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF); and Laura Kavanagh, Acting Commissioner, New York City Fire Department (FDNY), announced the arrest and charge.

“As alleged, Lhota deliberately set fire to a bar and nightclub patronized by members of the LGBTQ+ community, seriously injuring two of its employees, and endangering all present including the tenants of the building as well as the first responders who battled the blaze for approximately one hour,” stated United States Attorney Peace. “This Office strongly condemns such acts of violence, and will vigorously prosecute this case. The victims, and all LGBTQ+ New Yorkers, should be able to enjoy their nights out in peace and without fear of such a dangerous attack.”

Mr. Peace praised the Special Agents, Fire Marshals and Detectives of the Arson and Explosives Task Force for their outstanding investigative work on the case.

“Arson is a violent crime that impacts all New Yorkers. The prompt investigation leading to the arrest of Lhota demonstrates the commitment of the Arson and Explosive (A&E) Task Force to rapidly apprehend and bring to justice those who violently attack members of our community. ATF and its partners at FDNY and NYPD hope for the quick and full recovery of the victims,” stated Special Agent-in-Charge DeVito.  

“This was a brazen act of arson that seriously injured two people, placed the lives of residents and dozens of Firefighters in grave danger, and struck fear throughout an entire community,” said Acting Fire Commissioner Laura Kavanagh. “I commend our Fire Marshals for their outstanding work alongside members of the NYPD and ATF to apprehend this dangerous individual.”

As set forth in the complaint, on the evening of April 3, 2022, Lhota was captured on security video purchasing a red gas canister at a service station and filling it with gasoline. Lhota then proceeded to Rash, located on the ground floor of a multi-story building at 941 Willoughby Avenue, where he allegedly poured gasoline over the floor of the bar. The video showed Lhota tossing a lit cigarette on the floor, but the gasoline did not ignite. Lhota then used a cigarette lighter to ignite the gasoline, causing an explosion and a fire. The floors above Rash contain residential apartments. Firefighters responded to the location and extinguished the blaze. Two employees of Rash were injured and required hospitalization. The building sustained heavy damage due to the fire. Security video captured Lhota fleeing the burning nightclub.

The charge in the complaint is an allegation, and the defendant is presumed innocent unless and until proven guilty. If convicted, Lhota faces a mandatory minimum sentence of 7 years’ imprisonment, and a maximum of 40 years’ imprisonment.

The government’s case is being handled by the Office’s General Crimes Section. Assistant United States Attorney John O. Enright is in charge of the prosecution.

The Defendant:

JOHN LHOTA
Age: 24
Brooklyn, New York

E.D.N.Y. Docket No. 22-MJ-408

“Yesterday was a dark day for all of us. But the bright spots of the incredible heroism of our fellow New Yorkers helping each other in a time of crisis, the quick response by our first responders, and the hard work by all of our law enforcement partners that has been ongoing truly shines bright.

Today Frank James has been charged by complaint in Brooklyn Federal Court with one count of violating 18 U.S.C. 1992(a)(7), which prohibits terrorist and other violent attacks against mass transportation systems. Once apprehended, and if convicted, he will face a sentence of up to life imprisonment.

My office is prepared to prove beyond a reasonable doubt that: On April 12, 2022, in Sunset Park, Brooklyn, in the Eastern District of New York, the defendant Frank James did knowingly and without lawful authority and permission commit an act, including the use of a dangerous weapon, with the intent to cause death and serious bodily injury to passengers and MTA employees on the New York City subway system. The government will prove, among other things, that James traveled across a state line in order to commit the offense and transported materials across a state line in aid of the commission of the offense.

We are working closely with all of our law enforcement partners at the Kings County District Attorney’s Office, FBI, NYPD, ATF and the U.S. Marshals Service. My office will use every tool at our disposal to bring this individual to justice, and restore safety and peace of mind to all.”

BROOKLYN, NY – Earlier today, in federal court in Brooklyn, Aleah Mohammed was sentenced to 6.5 years in prison for carrying out multiple schemes to defraud health care programs, including obtaining more than $6.5 million from Medicare Part D plans and Medicaid drug plans. Mohammed pleaded guilty to one count of mail fraud, one count of health care fraud, and one count of conspiracy to commit health care fraud in April 2021.

Breon Peace, United States Attorney for the Eastern District of New York; Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division; Scott J. Lampert, Special Agent-in-Charge U.S. Department of Health and Human Services, Office of Inspector General’s Office of Investigations (HHS-OIG); and Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the sentence. 

“Through the Superdrugs Pharmacies that she owned and operated, the defendant was dispensing phantom prescriptions for fraud, stealing millions of dollars from the Medicare and Medicaid programs by submitting false claims for reimbursement,” stated U.S. Attorney Peace.  “Today's sentence demonstrates there are consequences for those who choose to finance lavish lifestyles by diverting government resources from health care programs intended to help those truly in need.”

According to court documents, Mohammed was an owner and operator of five pharmacies: Superdrugs Inc., Superdrugs I Inc., Superdrugs II Inc., S&A Superdrugs II Inc. and Village Stardrugs Inc.  Between 2015 and 2020, Mohammed utilized these pharmacies to engage in schemes that defrauded health care programs, including Medicare and Medicaid, by submitting claims for prescription drugs that were not dispensed, not prescribed as claimed, not medically necessary, or that were purportedly dispensed during a time when the pharmacy was no longer registered with the State of New York. The fraudulent claims included claims for expensive prescription drugs for the treatment of the human immunodeficiency virus (HIV). Mohammed and her family used proceeds of the scheme to purchase luxury items such as a Cadillac Escalade SUV, a Mercedes Benz sedan, a Porsche Turbo coupe, as well as jewelry and property in Queens and Pocono Pines, Pennsylvania.

The FBI and HHS-OIG are investigating the case, which was brought as part of the Medicare Fraud Strike Force under the supervision by the U.S. Attorney’s Office for the Eastern District of New York and the Criminal Division’s Fraud Section.  Trial Attorneys Andrew Estes and Patrick J. Campbell of the Criminal Division’s Fraud Section are in charge of the prosecution.

The Fraud Section leads the Medicare Fraud Strike Force. Since its inception in March 2007, the Medicare Fraud Strike Force, which maintains 15 strike forces operating in 24 districts, has charged more than 4,200 defendants who have collectively billed the Medicare program for nearly $19 billion. In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

The Defendant:

ALEAH MOHAMMED (also known as “Abby”)
Age:  37
Queens, New York

E.D.N.Y. Docket Nos. 18-CR-509 and 20-CR-581 (ENV)

A criminal complaint was unsealed today in federal court in Brooklyn charging Frank James with conducting a violent attack on a mass transportation vehicle in violation of 18 U.S.C. §§ 1992(a)(7) and (b)(1).  The charge, terrorist attacks or other violence against a mass transportation system, relates to the April 12, 2022, mass shooting on the New York City subway in Sunset Park, Brooklyn.  James was arrested earlier today by New York City police officers in Manhattan and will make his initial appearance tomorrow before United States Magistrate Judge Roanne L. Mann.

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), John DeVito, Special Agent-in-Charge, U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives, New York (ATF) and Keechant L. Sewell, Commissioner, New York City Police Department (NYPD), announced the arrest and charge.

“As alleged, the defendant committed a heinous and premeditated attack on ordinary New Yorkers during their morning subway commute,” stated United States Attorney Peace.  “All New Yorkers have the right to expect that they will be safe as they travel throughout our great city and use our vital transportation systems.  I am grateful to our law enforcement partners, the first responders and the everyday New Yorkers who stepped up during this crisis and showed the best of our city.  And, we continue to pray for the victims and their loved ones as they recover from this traumatic event, both physically and emotionally.” 

Mr. Peace praised the outstanding efforts of the FBI’s New York Joint Terrorism Task Force, which consists of investigators and analysts from the FBI, the NYPD, and over 50 other federal, state, and local agencies.

“Yesterday, as everyday New Yorkers commuted through Brooklyn on our subway system, Frank James – as alleged – committed a horrific act that resulted in an around-the-clock effort by the FBI's Joint Terrorism Task Force in New York, the NYPD, and the ATF to find him and bring him to justice. Thanks to the incredible work by all involved to identify James and get the proper information out to the public, he's in federal custody and New Yorkers can breathe a little easier in our city today,” stated FBI Assistant Director-in-Charge Driscoll. 

“Today’s arrest of Frank James was in large part due to the vigilance and a concerted effort by New Yorkers to aid law enforcement in the apprehension of violent criminals. We at ATF applaud the public’s engagement and participation in providing vital information to apprehend James, and we hope for a speedy recovery for all victims. ATF will continue to utilize our nationwide Crime Gun Intelligence capabilities to support our partners in the continued investigation of Tuesday’s horrific attack on the NYC subway,” stated ATF Special Agent-in-Charge DeVito.

“Today, after nearly 30 hours of dogged police work, Frank James was arrested by the NYPD without incident,” stated NYPD Commissioner Sewell.  “From the moment Mr. James committed this appalling crime, the police began shrinking his world until he had nowhere to turn – and the people of our city were working right alongside us. So together with our law enforcement partners at the FBI, the ATF, the U.S. Marshals Service, and the U.S. Attorney’s Office for the Eastern District of New York, I want to thank New Yorkers for their vigilance and their help in taking this violent criminal off our streets.”

As set forth in the complaint, during rush hour on the morning of April 12, 2022, James used a Glock 17 pistol he purchased in Ohio to conduct a mass shooting on an N subway train in Brooklyn.  James, dressed in an orange reflective jacket, yellow hard hat, and surgical mask, set off a smoke-emitting device in one of the train cars before firing at subway riders.  James had arrived in New York earlier that day in a rental van driven from Pennsylvania.  He parked the van on Kings Highway, approximately two blocks from the entrance to an N-train station, near where the shooting took place.  After the attack, James abandoned a bag containing, among other items, fireworks, a plastic container containing gasoline, and a torch.

In videos he posted publicly on YouTube before the attack, James made various statements about the New York City subway system.  Among other things, James addressed statements to New York City’s mayor: “What are you doing, brother?  What’s happening with this homeless situation?” and “Every car I went to wa[s] loaded with homeless people.  It was so bad, I couldn’t even stand.”  James also made statements, in sum and substance, about various conspiracy theories, including that: “And so the message to me is: I should have gotten a gun, and just started shooting motherf---ers.” 

Following the attack, members of law enforcement executed court-authorized search warrants for properties associated with James in Pennsylvania.  Agents recovered, 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 canister. 

If convicted the defendant faces a maximum sentence of life imprisonment.

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

Anyone with information about Mr. James or this incident is asked to call the FBI at 1-800-CALLFBI. Digital tips may also be submitted by visiting www.fbi.gov/brooklynshooting.

The government’s case is being handled by the Office’s National Security and Cybercrime Section.  Assistant U.S. Attorneys Douglas M. Pravda, Alexander A. Solomon, Craig R. Heeren, David K. Kessler, Ian C. Richardson, Artie McConnell, Alexander Mindlin, Sara Winik, Ellen Sise, and Meredith A. Arfa, and Paralegal Specialists Wayne Colon and Benjamin Richmond, handled the investigation, with assistance provided by Trial Attorney Larry Schneider of the National Security Division’s Counterterrorism Section.

The Defendant:

FRANK JAMES
Age:  62
Milwaukee, Wisconsin

E.D.N.Y. Docket No. 22-MJ-429

被告教唆成员内容包括：“（如果她）敢反抗，就打得更狠一点， 打出来点效果，钱不能白扔“

布碌仑联邦法庭今天对陈思阳、陈思宇 (同时被称为班班，译音) 、姜波、宋美珍（同时被称为蝶蝶）、徐荣荣（同时被称为Eleanor）、严家润 (同时被称为Raymond Yan 及Mike) 、于基龙、卡洛斯.柯瑞 (Carlos Cury) 及唐泽荣所涉及的罪行提出20项起诉，其中包括诈骗、性贩卖、霍布斯法抢劫和暴力攻击等罪名。此一犯罪集团以纽约州皇后区为基地，但罪行遍布全美，包括夏威夷州、堪萨斯州、密西根州、密苏里州、内布拉斯加州、新罕布什尔州、俄勒冈州、德克萨斯州和华盛顿州。共有八名被告逮捕到案，并将于今天下午在助理法官XXXX庭上提讯过堂。

美国司法部调查局纽约州东区律师皮斯 (Breon Peace)、联邦调查局纽约办公室助理监察德睿斯考（Michael J. Driscoll）和纽约市警察局局长塞维尔(Keechant L. Sewell)共同宣布了本次逮捕行动和起诉罪名。

司法调查局律师皮斯指出， “这些被告锁定弱势女性进行性贩卖罪行，并用暴力袭击这些受害人，让她们服从犯罪集团的指令，个人不应成为交易标的，而在此项罪行中的受害者，无论她们的移民身份为何，都应享有免受暴力及被迫提供性行为的自由。我们希望今天的逮捕能为这些受害人遭受的恐怖经历，带来一定程度的司法正义，这个案例是我们检调单位长期以来打击以剥削受害人自由并从中获利的人口贩卖集团，并致力将其绳之以法的另一证明。“

法院罪状指出，被告在2019年4月到2021年9月间，涉及暴力和组织诈骗集团，并在全美经营获利丰厚的卖淫业务，此犯罪集团主要招募来自中国且不具合法居留美国身份的女性，为该集团提供卖淫业务。这些受害人有时还必须提供她们的身份证明文件，让涉案罪犯能对其进行更多掌控，该犯罪集团会安排这些女性从纽约州旅行至全美各地，每次在酒店或集团控制的公寓内停留数周，并在停留期间进行商业行为。犯罪集团成员及同伙会在交易完成后向这些被害女性收取金钱，然后用此收入进一步推广人口贩卖及跨州卖淫行为，让涉及罪犯从中获利。

如罪状中提出的，以上犯罪集团的罪犯及其同伙在2020年1月8日至2021年9月1日期间，在五个州境内对超过15名女性进行或教唆施暴，这些受害的中国女性应是为这犯罪集团或其对手集团提供商业卖淫活动，集团成员对这些女性进行暴力袭击，期能让这些受害人服从指令完成卖淫工作，并相信因为这些被害人不是美国公民，所以从事商业的性交易工作将不会受起诉。特别是这犯罪集团成员及同伙会指派个别男子担任嫖客，让受害人在不知情前提下让这些同伙进入酒店房间，一旦入室后，这些假嫖客将封住被害人的嘴、用铁锤、棍棒或其他突击物品对被害人施暴，并掠夺其财物。如果这些暴力行为对受害人没有造成足够伤害，该集团和罪犯还会鼓励施暴者用更严酷的殴打，在执法单位所录取的一段电话对话中，其中一名成员告诉施暴人“明天往死里打，敢反抗就打得更狠一点，打出来点效果，钱不能白扔”。另一段录取的对话则是一位成员说“这次不一样， 咱不要绑手。一个人控制锁喉，另一个人往死里打四肢，绝对不能发出声音，把她打到不能反抗了， 完事儿拿了手机就走。” 

起诉书中的罪状均属指控，所有被告在证明有罪之前均属无辜。

皮斯律师对联邦调查局和纽约市警察局的调查工作特别提出赞扬，这次的调查工作收到全美执法单位的协助，皮斯律师也致意感谢内布拉斯加州的美国司法局办公室、美国国土防卫部边境移民管理局位于俄克拉荷马市和曼彻斯特市二个办公室的执法单位，另外，包括俄勒冈州毕佛尔顿市警局、密西根州警、密苏里州高速公路巡警、俄克拉荷马市（俄克拉荷马州）警局、欧佛兰公园市（堪萨斯州）警局、波特兰市（俄勒冈州）警局、南区市（密西根州）警局、和突洛依市（密西根州）警局等地方执法单位也在本次调查中提供宝贵协助。

政府当局将由组织犯罪和帮派及民权办公室担任代表，对本案提起诉讼，司法院助理法官盖力奥提（Matthew R. Galeotti）、奔辛（Kayla C. Bensing）和史瓦瑞兹（Sophia M. Suarez）将负责本案的诉讼。 

联邦调查局纽约亚裔犯罪集团联合专案组确信, 这个集团可能要对更多在美国各地发生的, 对从事性交易的性工作者的攻击事件负责。如果您是受害者,  或有讯息要提供，可以通过以下方式联系我们:  您可以在tips.fbi.gov通过网络举报, 或拨打我们的直线电话1-800-CALL-FBI. 无论您是什么移民身份, 我们有专人随时用您的母语与您交谈。 接通后, 请选择英文; 然后告訴接线生您需要的翻译。 您可以用任何语言进行网络举报。紧急事件, 请拨打911给警方。

被告:

陈思阳
32岁
纽约州皇后区

陈思宇 （同时被称为班班）
24岁
纽约州皇后区

姜波
26 岁
纽约州皇后区

宋美珍 （同时被称为“蝶蝶“）
23岁
达拉斯市，德克萨斯州

徐荣荣（同时被称为 “Eleanor”）
29 岁
纽约州皇后区

严家润（同时被称为 “Raymond Yan” 和 “Mike”）
28 岁
纽约州皇后区

于基龙
23岁
达拉斯市，德克萨斯州

CARLOS CURY
41岁
纽约州皇后区

唐泽荣
24岁
纽约州皇后区

In May 2021, the Justice Department’s Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) issued a proposed rule to curb the proliferation of ghost guns—privately made firearms that are increasingly being recovered at crime scenes across the United States.  Ghost guns generally do not have a serial number placed on the frame or receiver of the firearm.  As a result, law enforcement faces obstacles when trying to determine where, by whom, or when these deadly ghost guns were manufactured, and to whom they were sold or otherwise disposed. 

Yesterday, following a thorough and extensive public comment period, the Department announced the final rule.  We commend our law enforcement partners at ATF for this important, life-saving new rule.  The U.S. Attorney’s Office for the Eastern District of New York will use every tool at its disposal—both criminal and civil—to eliminate the scourge of illegal guns across New York City and across the country.

Breon Peace, United States Attorney for the Eastern District of New York, and Karnig Ohannessian, Deputy Assistant Secretary of the Navy (Environment & Mission Readiness), announced today that Northrop Grumman has agreed to pay the United States $35 million for environmental cleanup costs incurred as a result of operations at the former Naval Weapon Industrial Reserve Plant (NWIRP) in Bethpage, New York, and adjacent facilities (Sites).  The payment resolves a civil lawsuit brought by the United States against Northrop Grumman under the federal Comprehensive Environmental Response, Compensation and Liability Act (CERCLA).

“This settlement compensates the United States for some of the enormous costs it has expended in connection with the cleanup of the former Naval Weapon Industrial Reserve Plant in Bethpage,” stated United States Attorney Peace.  “The government’s remediation at the site restores natural resources, including land and groundwater in the area, and ensures public health and safety.”

A Consent Judgment setting forth the terms of the settlement provides that Northrop Grumman and the Navy will continue their respective remedial actions associated with the Sites and coordinate their cleanup efforts to benefit the public. 

The proposed Consent Judgment will be lodged with the District Court for a period of at least 30 days, and notice of the Consent Judgment will be published in the Federal Register.  This will afford members of the public the opportunity to submit comments on the Consent Judgment to the Department of Justice prior to it seeking court approval of the settlement.

The NWIRP was a government-owned, contractor-operated facility where Northrop Grumman’s predecessors (collectively “Grumman”) designed and manufactured aircraft for the Navy. Grumman also owned the adjacent approximately 500-acre former Northrop Grumman Bethpage Facility Site, which included an 18-acre property, now part of the Bethpage Community Park. Grumman used the Sites for industrial and research purposes from the late 1930s through1996. Manufacturing and disposal practices at the Sites resulted in contamination of the soil and groundwater with hazardous substances, including volatile organic compounds (VOCs), polychlorinated biphenyls (PCBs) and metals.   

The Navy began conducting investigations and assessments at the NWIRP in 1986, and the cleanup is ongoing. The Navy continues to implement its remedial actions, including for treatment of contaminated groundwater.   

The Navy’s remediation efforts include:

• Remediation of contaminated soils and shallow groundwater at the NWIRP through soil excavation, use of a vapor extraction system to remove TCE contamination from the soil, and placement of soil covers and land use controls;
• Design, implementation, operation and maintenance of onsite groundwater extraction wells and treatment systems to capture and treat VOCs before they migrate off property;
• Off-property groundwater capture and treatment of hotspots to reduce contaminant mass in the plume and limit downgradient migration;
• Additional treatment wells to intercept, as practicable, the southern extent of the site-related groundwater plumes;
• Installation of groundwater monitoring wells and long-term monitoring;
• Investigation and remediation of site-related 1-4 dioxane in the groundwater;
• Development and implementation of a public water supply protection program.

In addition to the costs associated with such Navy cleanup activities, since 2010, the United States has incurred costs under several consent judgments with local water districts whose water supply wells are potentially affected by the plumes to ensure their continued provision of safe drinking water.

The case was handled by Assistant United States Attorneys Kathleen Mahoney and Matthew Silverman from the United States Attorney’s Office for the Eastern District of New York, and by Richard Green, Assistant Director for Affirmative Environmental Claims, Office of General Counsel, Naval Litigation Office, Department of the Navy. 

Additional information concerning the Navy’s cleanup and site-related public engagement activities can be found online at: http://go.usa.gov/DyXF.  The Navy also maintains a public repository of site-related materials at the Bethpage Public Library, 47 Powell Avenue, Bethpage, New York 11714, (516) 931-3907.

E.D.N.Y. Docket No. 22-CV-2101

Defendant Instructed Enforcer: “If She Dares Fight Back, Beat Her More Viciously. Get Some Results from the Beating.” 

A 20-count indictment was unsealed today in federal court in Brooklyn variously charging Siyang Chen, Siyu Chen, also known as “Ban Ban,” Bo Jiang, Meizhen Song, also known as “Die Die,” Rong Rong Xu, also known as “Eleanor,” Jiarun Yan, also known as “Raymond Yan” and “Mike,” Jilong Yu, Carlos Cury and Zerong Tang with racketeering, sex trafficking, Hobbs Act robbery and violent assaults.  The operation was based in Queens, New York, but carried out crimes throughout the United States, including in Hawaii, Kansas, Michigan, Missouri, Nebraska, New Hampshire, Oregon, Texas and Washington.  Eight defendants were arrested today and will be arraigned this afternoon before United States Magistrate Judge Roanne L. Mann. 

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 Keechant L. Sewell, Commissioner, New York City Police Department (NYPD), announced the arrests and charges.

“As alleged, the defendants targeted vulnerable women for sex trafficking, and brutally assaulted the victims to enforce loyalty to the criminal enterprise.  Human beings are not property, and the victims in this case, regardless of their immigration status, deserve to be free from violence and coerced sexual activity.  It is our hope that today’s arrests will bring them some measure of justice for the horror that they have endured,” stated United States Attorney Peace.  “This case is another example of our Office’s longstanding commitment to bringing to justice sex trafficking organizations that exploit and dehumanize victims for financial gain.” 

“The conduct alleged today spells out years of abuse inflicted upon vulnerable women on behalf of those who orchestrated this nationwide sex trafficking and prostitution enterprise,” stated FBI Assistant Director-in-Charge.  “Victims in this case should know the FBI’s Joint Asian Criminal Enterprise Task Force won’t tolerate the actions of those who offer the sexual activities of others in exchange for payment. If you’re a victim or have information to provide, we want to hear from you—regardless of your immigration status. Call us at 1-800-CALL-FBI or submit a tip online at tips.fbi.gov.”

“Our job is to ensure that anyone who would seek to profit through the abuse and exploitation of another human being be brought to justice swiftly and successfully,” stated NYPD Commissioner Sewell.  “Today’s charges also further affirm the NYPD’s unwavering commitment to protecting the survivors of sex trafficking. To that end, I thank and commend the U.S. Attorney’s Office for the Eastern District and our partners at the FBI for their immeasurable support in building this critical case.”

As set forth in court filings, between April 2019 and September 2021, the defendants participated in a violent and organized racketeering enterprise, which operated a lucrative prostitution business throughout the United States.  The enterprise recruited women, most of whom were from China and lacked legal status in the United States, to engage in prostitution for the enterprise.  The victims were sometimes required to provide copies of their identification documents so that the defendants could maintain even more control over them.  The enterprise arranged for the women to travel from New York to locations throughout the country, stay in hotels and enterprise-operated apartments for weeks at a time and engage in commercial sex.  Members and associates of the organization collected money from the women and the organization then used those illicit proceeds to promote its sex trafficking and interstate prostitution activities — and enrich its members. 

As alleged, between January 8, 2020 and September 1, 2021, members and associates of the enterprise directed and conducted more than 15 violent assaults of women across five states.  The victims were Chinese women who the organization believed were providing commercial sex services on their own or for rival organizations.  By committing these violent assaults, members of the organization sought to enforce discipline and believed their conduct would not be prosecuted because the victims were not U.S. citizens and were engaged in commercial sex work.  Specifically, members and associates of the enterprise would direct individuals to pretend to be johns to gain access to their hotel rooms and, once inside, would restrain the women with zip-ties, beat them with hammers, bats and other blunt objects, and rob them.  Members of the organization often encouraged increasingly severe beatings of the victims if the initial attack did not sufficiently injure them.  In one phone message that was recovered by law enforcement, a member instructed the enforcer: “Beat [her] to death tomorrow.  If she dares fight back, beat her more viciously.  Get some results from the beating.  Can’t waste the money.”  In another recovered chat, a member advised, “One person choke her by her throat, the other person strike her four limbs to death.  Definitely don’t make a sound.  Beat her to the point where she can’t fight back.” 

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

Mr. Peace praised the outstanding investigative work of the FBI and the NYPD.  This investigation was aided by law enforcement agencies throughout the country.  Mr. Peace expressed his thanks to the United States Attorney’s Office for the District of Nebraska, as well as the Oklahoma City and Manchester field offices of United States Homeland Security Investigations and United States Immigration & Customs Enforcement.  In addition, local police departments across the United States provided invaluable assistance, including the Beaverton (Oregon) Police Department, Michigan State Police, Missouri Highway Patrol, Oklahoma City (Oklahoma) Police Department, Omaha (Nebraska) Police Department, Overland Park (Kansas) Police Department, Portland (Oregon) Police Department, Southfield (Michigan) Police Department, and Troy (Michigan) Police Department.

The government’s case is being prosecuted by the office’s Organized Crime and Gangs and Civil Rights Sections.  Assistant United States Attorneys Matthew R. Galeotti, Kayla C. Bensing and Sophia M. Suarez are in charge of the prosecution. 

The FBI’s New York Joint Asian Criminal Enterprise Task Force believes this enterprise may be responsible for the assaults of even more commercial sex workers throughout the country.  If you are a victim or have information to provide, there are several ways to contact the FBI: send a tip online at https://tips.fbi.gov/ or call 1-800-CALL-FBI.  They have people ready to work with you in your native language, regardless of your immigration status.  Please select English when prompted and ask the operator for a translator by stating your language of choice. Online tips may be submitted in any language.  In an emergency, always call 911 for the police.

The Defendants:

SIYANG CHEN
Age:  32
Queens, New York

SIYU CHEN, also known as “Ban Ban,”
Age:  24
Queens, New York

BO JIANG
Age:  26
Queens, New York

MEIZHEN SONG, also known as “Die Die,”
Age:  23
Dallas, Texas

RONG RONG XU, also known as “Eleanor,”
Age:  29
Queens, New York

JIARUN YAN, also known as “Raymond Yan” and “Mike,”
Age:  28
Queens, New York

JILONG YU
Age:  23
Dallas, Texas

CARLOS CURY
Age:  41
Queens, New York

ZERONG TANG
Age:  24
Queens, New York

“I am Breon Peace, the United States Attorney for the Eastern District of New York.

Five years ago today, on April 11, 2017, the defendant Leniz Escobar lured five young men to a park not far from the federal courthouse in Central Islip, Long Island.  Those five young men, in the prime of their lives, had no idea that Escobar was leading them to their death—into a killing field where MS-13 gang members lay in wait, armed with machetes, an axe, knives, tree limbs, and a chisel.  One of the young men managed to escape and lived to tell his story to a federal jury.  His four friends were not so fortunate. Escobar’s cohorts hacked and beat them to death.  One of the murder victims was so disfigured he was only identifiable by dental records.

Today, on the five-year anniversary of this tragic mass murder, a federal jury delivered justice to Escobar.  Our hearts go out to the families of the victims. We know that the verdict does not erase the pain you wake up with every day and will always carry with you.  But, we hope that this day brings some measure of consolation. 

My Office, and all our law enforcement partners on the FBI’s Long Island gang task force will not rest until every single MS-13 gang member and associate responsible for this horrendous crime is held accountable.  I am so grateful for my amazing team – prosecutors Paul Scotti, Justina Geraci, and Megan Farrell, paralegal Shernita Moore-Glasgow, along with the FBI special agents and the Suffolk County detectives who did such great work on this important case.

Finally, I want to thank the jury.  They came from all over our District to the courthouse for three weeks during a pandemic.  They were committed to serve, to do justice and that is exactly what they did.”

Click here for a video of the statement.

A federal jury in Central Islip returned a guilty verdict today against Leniz Escobar, an associate of the Leeward Locos Salvatruchas (“Leeward”) and Brentwood Locos Salvatruchas (“Brentwood”) cliques of La Mara Salvatrucha, also known as the MS-13, a transnational criminal organization.  Escobar was convicted of racketeering, including predicate acts of murder, conspiracy to murder rival gang members, and obstruction of justice; and murder in aid-of racketeering, in connection with her participation in the April 11, 2017 murders of Justin Llivicura, Michael Lopez, Jorge Tigre and Jefferson Villalobos.  The verdict followed a four-week trial before United States Circuit Judge Joseph F. Bianco.  When sentenced, Escobar faces up to life in prison.

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 Rodney K. Harrison, Commissioner, Suffolk County Police Department (SCPD), announced the verdict.

“With today’s verdict, Escobar has been held responsible for the crucial role that she willingly played in orchestrating one of the most vicious and senseless mass murders in the district in memory,” stated United States Attorney Peace.  “The defendant showed utter disregard for human life by leading the victims into a killing field, to their slaughter, to enhance her stature with her fellow cold-blooded murderers within the MS-13 gang.  It is my hope that Escobar’s conviction will bring some measure of closure to the relatives of the victims and serve as a warning to other gang members that this Office, together with our law enforcement partners, will not rest until everyone responsible for these murders is held accountable and the MS-13 no longer poses a danger to our district.”

Mr. Peace expressed his thanks to the members of the FBI’s Long Island Gang Task Force for their outstanding work on the case.

“As proven at trial, Ms. Escobar played a crucial role in a heinous and senseless crime, the 2017 slayings of four young men believed by MS-13 to be members of a rival gang.  Subsequent to the murders she continued to demonstrate her callous disregard for human life when she boasted about her role in the killings to enhance her stature within the gang.  While nothing can bring the victims back, it is our hope that today’s verdict can bring their families a measure of comfort, knowing justice has been served,” stated FBI Assistant Director-in-Charge Driscoll.

“Today’s verdict sends a clear message that those who associate with a gang will be held accountable for their involvement with gang activity,” stated SCPD Commissioner Harrison.  “Escobar showed a complete disregard for human life and put her allegiance to the gang ahead of the rule of law.  I applaud all those involved from the Suffolk County Police Department, the FBI and our partners in law enforcement for their hard work and dedication to justice.”

The evidence at trial proved that on the evening of April 11, 2017, Escobar, also known as “Diablita,” and a co-conspirator, Keyli Gomez, lured five young men, including the four murder victims, to a park in Central Islip where they were attacked by members of the MS-13.  The MS-13 members believed the victims to be members of a rival gang, at least two of whom had disrespected the MS-13 by posting photos on social media in which they wore certain items and flashed hand signs that signified membership in the MS-13 gang.  Escobar and Gomez showed the gang-related photos to members of the MS-13, who confirmed the young men did not belong to MS-13, and it was decided that the victims would be killed.  Gomez testified at the trial that she and Escobar drove with the victims to the park, led them to a predetermined wooded area, and sent the MS-13 members text-messages notifying them of their arrival.  The MS-13 members and associates proceeded to the designated location and encircled the victims under the cover of darkness.  One of the intended victims immediately fled and was able to escape.  Llivicura, Lopez, Tigre and Villalobos were surrounded by MS-13 members, who attacked them with machetes, knives, an axe, and wooden clubs.  After the attack, the MS-13 members dragged the victims’ bodies to a more secluded spot in the woods, piled them up, and then fled.  The victims’ bodies were discovered the following evening.

In the days following the murders, Escobar bragged to other MS-13 members about her role in the killings and, in recorded calls with her boyfriend, who was a high-ranking member of the Brentwood clique, discussed the attack in detail.  Using barely coded language, and referring to the victims who were killed, she said, “four individuals took the train and who knows when they’ll be back, got me?”  Escobar then shared how that plan went awry when one person escaped, adding “But one of them, one of them managed to still be here on the map” and “he knows stuff about me.”  In a separate call, Escobar told her boyfriend that she was “happy for this to happen.”  Of the four victims, she said they were “never coming back . . . somewhere else . . . seeing the light . . . no more . . . out of here . . . not on the map.”

Additionally, Escobar destroyed evidence of her involvement in the murders by disposing of a sweatshirt stained with the blood of a victim, tossing her cellular phone from a moving vehicle when she was being followed by the police, and falsely telling detectives that she and Gomez were victims of a random robbery in the park on the night of the murders.  Gomez pleaded guilty to racketeering charges in connection with the murders and is awaiting sentencing.

More than a dozen MS-13 members and associates have been charged in connection with the April 11, 2017 murders.

Today’s conviction is the latest in a series of federal prosecutions by the United States Attorney’s Office for the Eastern District of New York targeting members of the MS-13, a violent, transnational criminal organization.  The MS-13’s leadership is based in El Salvador, Honduras, Guatemala and Mexico, but the gang has thousands of members across the United States.  With numerous branches, or “cliques,” the MS-13 is the most violent criminal organization on Long Island.  Since 2003, hundreds of MS-13 members, including dozens of clique leaders, have been convicted on federal felony charges in the Eastern District of New York.  A majority of those MS-13 members have been convicted on federal racketeering charges for participating in murders, attempted murders and assaults.  Since 2010, this Office has obtained indictments charging MS-13 members with carrying out more than 60 murders in the Eastern District of New York, resulting in the convictions of dozens of MS-13 leaders and members in connection with those murders.  These prosecutions are the product of investigations led by the FBI’s Long Island Gang Task Force, which is comprised of agents and officers of the FBI, SCPD, Nassau County Police Department, Nassau County Sheriff’s Department, Suffolk County Probation Office, Suffolk County Sheriff’s Office, the New York State Police, the Hempstead Police Department, the Rockville Centre Police Department and the New York State Department of Corrections and Community Supervision.

The government’s case is being handled by the Office’s Long Island Criminal Division.  Assistant United States Attorneys Paul G. Scotti, Justina L. Geraci and Megan E. Farrell are in charge of the prosecution.

The Defendant:

LENIZ ESCOBAR
Age: 22
Islip Terrace, New York 

E.D.N.Y. Docket No. 21-CR-101 (JFB)

“Soy Breon Peace, el Fiscal de los Estados Unidos para el Distrito Este de Nueva York.

Hoy hace cinco años, el 11 de abril de 2017, la acusada, Leniz Escobar, atrajo a cinco jóvenes a un parque no muy lejos de la corte federal en Central Islip, Long Island.

Esos cinco jóvenes, en la plenitud de la vida, no tenían idea de que Escobar los estaba llevando a la muerte—a un campo de exterminio donde miembros de la pandilla MS-13 esperaban al acecho, armados con machetes, un hacha, cuchillos, ramas y un cincel.   

Uno de los jóvenes se las arregló para escapar y vivió para contar su historia a un jurado federal. Sus cuatro amigos no fueron tan afortunados. Los secuaces de Escobar los machetearon y golpearon hasta matarlos. Una de las víctimas del asesinato quedó tan desfigurado que solo pudo ser identificado a través de registros dentales.

Hoy, en el quinto aniversario de ese trágico asesinato en masa, un jurado federal ha hecho justicia con Escobar.

Nuestros sentimientos están con las familias de las víctimas. Sabemos que el veredicto no borra el dolor con el que despiertan cada mañana y que siempre llevarán con ustedes. Pero esperamos que este día les provea un poco de consuelo.

Mi oficina (la fiscalía de los Estados Unidos) y todos nuestros colegas agentes del orden en la fuerza de tarea contra pandillas del FBI en Long Island, no descansaremos hasta que cada uno de los miembros y asociados de la pandilla MS-13 responsables por este horrendo crimen respondan por él.

Estoy muy agradecido por mi asombroso equipo - fiscales Paul Scotti, Justina Geraci y Megan Farrell, paralegal Shernita Moore-Glasgow, junto a los agentes especiales del FBI y a los detectives del condado de Suffolk, quienes hicieron un gran trabajo en este importante caso.

Finalmente, quiero agradecer al jurado. Vinieron de todas partes de nuestro distrito al tribunal por tres semanas durante una pandemia. Estaban comprometidos a servir, a hacer justicia, y eso es exactamente lo que hicieron.”

El video de la declaración esta aquí.

“A short time ago, a federal jury in Brooklyn convicted former Goldman Sachs managing director Roger Ng of participating in a bribery and money laundering scheme related to a Malaysian investment development fund known as 1MDB.

The scheme was massive in its scale – the defendant and his co-conspirators embezzled billions of dollars from the fund. It was brazen in its execution – Ng obtained lucrative business for his employer by bribing a dozen government officials in Malaysia and Abu Dhabi. And it was obscene in its greed.

Today’s verdict is a victory for not only the rule of law, but also for the people of Malaysia for whom the fund was supposed to help, by raising money for projects to develop their country’s economy. The defendant and his cronies saw 1MDB not as an entity to do good for the people of Malaysia, but as a piggy bank to enrich themselves with piles of money siphoned from the fund.

Between 2012 and 2013, the defendant, Roger Ng, received more than $35 million in kickbacks for his role in the scheme to steal and launder billions of dollars from 1MDB, including funds 1MDB raised in 2012 and 2013 through three bond transactions and to use that money for bribes. Ng also conspired to circumvent Goldman Sachs’s internal accounting controls to ensure that Goldman Sachs would approve the three bond deals that were critical to the scheme. Ng conspired with others to launder the proceeds through the United States financial system by purchasing, among other things, luxury real estate in New York City, valuable artwork, jewelry, and funding Hollywood films like “The Wolf of Wall Street.”

In another film made about Wall Street, not related to the criminal scheme in this case, a character infamously suggested that greed is good. But, greed is not good, particularly when it leads to corruption and abuse, circumvention of corporate policies and controls, and the violation of federal law. With today’s verdict, a powerful message has been delivered to those who commit financial crimes motivated by greed. You will be caught, prosecuted and convicted, like Ng, and face a long prison sentence.

This case was a team effort by prosecutors from my Office, Alixandra Smith, Drew Rolle and Dylan Stern along with trial attorneys Brent Wible and Jennifer Ambuehl from the Department of Justice’s Criminal Division, FBI Special Agents Sean Fern, Ryan Collins and Jarrett Brown, FBI forensic accountant Eric Van Dorn, FBI Supervisory Special Agent Robert Heuchling, and Special Agent Marty Sullivan from the Eastern District of New York. They were assisted by EDNY paralegal Daniel Youkilis and Criminal Division paralegals Robert Dwyer and Lianis Marrero Mendez. Their work was outstanding.

And finally, I commend the jury for their attention to the evidence, their dedicated service over the past seven weeks, during a pandemic, and their commitment to do justice.”

Click here for the video of the statement. 

Earlier today, at the federal courthouse in Brooklyn, Orlando Lopez was sentenced by United States District Judge Eric R. Komitee to 55 years’ imprisonment for nine counts of child exploitation and one count of possession of child pornography.  Lopez was also ordered to pay restitution to his victims.  Lopez pleaded guilty to the charges in July 2021.

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 sentence.

“The defendant raped and sexually abused numerous vulnerable children, many of them infants and toddlers, for his own gratification,” stated United States Attorney Peace.  “Although today’s lengthy sentence cannot undo the harm that he inflicted on the victims and their families, it represents some measure of justice for his horrific crimes and ensures that no more children will suffer at the hands of this predator.” 

Mr. Peace expressed his appreciation to the Queens County District Attorney’s Office for their assistance with the prosecution.

“The conduct for which Mr. Lopez was convicted is among the most depraved our experienced investigators have ever encountered.  Prior to law enforcement intervention, he raped and sexually exploited children - some of whom were infants when their abuse began - for more than a decade,” said Assistant Director-in-Charge Driscoll.  “Today's sentence insures he will never harm another child, and our hope is that it brings some measure of comfort to his victims and their families as they continue their recovery from the harm he inflicted upon them.”

Beginning in approximately 2008, and for more than a decade, Lopez raped and sexually exploited children who lived at or near his apartment building in Jamaica, Queens, and took video and photographs of the abuse.  Lopez typically abused his victims in his apartment or their residence, but on occasion abused them in other locations, including a local YMCA facility.  During the sexual abuse, Lopez sometimes attempted to distract his child victims by providing them with candy or toys. 

Law enforcement recovered approximately 13,000 files of child pornography from Lopez’s residence depicting sexual activity with at least 15 child victims, some of whom were infants with the abuse began.  Lopez distributed some of the child pornography he created to others. 

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

Assistant United States Attorney Tanya Hajjar is in charge of the prosecution.

The Defendant:

ORLANDO LOPEZ
Age:  66
Jamaica, Queens

E.D.N.Y. Docket No. 20-CR-52 (EK)

Earlier today, in federal court in Brooklyn, Wayne Peiffer, a former police officer in Brewster, New York, pleaded guilty to conspiracy to commit Hobbs Act extortion and conspiracy to commit bribery in violation of the Travel Act.  Peiffer was charged for his role in protecting two Queens-based prostitution businesses from law enforcement when operating in Brewster, in exchange for free sexual services.  Today’s proceeding was held before United States Chief Magistrate Judge Cheryl L. Pollak.  When sentenced, Peiffer faces up to 25 years in prison and forfeiture of $5,000.

Breon Peace, United States Attorney for the Eastern District of New York, Ricky J. Patel, Acting 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), and Keechant L. Sewell, Commissioner, New York City Police Department (NYPD), announced the guilty plea.

“The defendant disgraced his sworn oath to protect and serve the community by using his badge as a shield for prostitution rings in exchange for sexual services from victims of sex trafficking,” stated United States Attorney Peace.  “Rooting out official corruption and protecting victims and survivors of trafficking are top priorities of this Office.” 

Mr. Peace expressed his appreciation to the Putnam County District Attorney’s Office and the Putnam County Sheriff’s Department for their assistance throughout this investigation.

“Sex trafficking and forced prostitution are crimes against the body and soul that shock the conscience of society,” stated HSI Acting Special Agent-in-Charge Patel.  “For years, Wayne Peiffer abused his position as a law enforcement officer and betrayed the trust given to him by society, taking sexual favors from the women he was sworn to protect.  Due to the hard work of HSI, EDNY prosecutors, and our law enforcement partners, Peiffer has pleaded guilty to his crimes and his network of violators has been dismantled.  HSI will vigorously pursue criminals like Peiffer, whether they operate in the U.S. or abroad.”

“Corruption is a crime and a stark violation of a police officer’s sacred oath,” stated NYPD Commissioner Sewell.  “With today’s guilty plea, this former officer admitted to disgracing his shield and betraying the public trust. The NYPD and our law-enforcement partners will continue to proactively identify and expose such unethical and immoral behavior committed by anyone sworn to enforce and uphold the law.”

According to court documents and facts presented during today’s proceeding, from approximately 2010 through October 2018, Peiffer provided protection to members of a prostitution business and a sex trafficking organization that each transported women from Queens to Brewster, New York, for the purposes of engaging in prostitution.  Peiffer’s protection included advance notice of law enforcement activities and assistance with avoiding detection and apprehension.  In exchange, Peiffer directed members of the prostitution business and sex trafficking organization to deliver women to him, including at the Brewster Police Department station, for free sexual services.

The government’s case is being prosecuted by the office’s Civil Rights Section.  Assistant United States Attorneys Lauren H. Elbert, Nicholas J. Moscow and Rachel A. Bennek are in charge of the prosecution. 

The Defendant:

WAYNE PEIFFER
Age:  48
Highland, New York

E.D.N.Y. Docket No. 21-CR-622 (LDH)

BROOKLYN, NY – Ng Chong Hwa, also known as “Roger Ng,” a citizen of Malaysia and a former Managing Director of The Goldman Sachs Group, Inc. (Goldman Sachs), was convicted today by a federal jury in Brooklyn on all counts of a superseding indictment charging him with conspiring to launder billions of dollars embezzled from 1Malaysia Development Berhad (1MDB), conspiring to violate the Foreign Corrupt Practices Act (FCPA) by paying bribes to a dozen government officials in Malaysia and Abu Dhabi, and conspiring to violate the FCPA by circumventing the internal accounting controls of Goldman Sachs.  The verdict followed a seven-week trial before United States Chief District Judge Margo K. Brodie.

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; Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI); and Ryan Korner, Special Agent-in-Charge, Internal Revenue Service Criminal Investigation, Los Angeles Field Office (IRS-CI), announced the verdict.

“Today’s verdict is a resounding victory for justice and for the people of Malaysia who were the victims of this massive scheme that the defendant and his partners in crime carried out in a frenzy of greed to get rich by stealing millions of dollars from the 1MDB fund intended to benefit that country’s economy,” stated United States Attorney Peace.  “The Department of Justice and this Office are committed to addressing corporate culture by vigorously combating white-collar crime and holding corrupt individuals who seek to enrich themselves accountable for violating U.S. laws here and abroad.”

“Roger Ng participated in a massive bribery and money laundering scheme involving the corruption of high-level foreign officials in Malaysia and the United Arab Emirates,” stated Assistant Attorney General Polite.  “This trial demonstrates the commitment by the Department of Justice to prosecute and hold accountable individuals who engage in corruption and use our financial system to launder funds related to their illicit schemes. We will continue to pursue criminal wrongdoers and will seek to bring them to justice, wherever they are, deprive them of their ill-gotten gains, and, wherever possible, return corrupt proceeds to those harmed by corruption — as we have throughout our longstanding investigation into the 1MDB scheme.”

“By virtue of today’s verdict, Roger Ng stands convicted of significant crimes for his role in a conspiracy to launder billions of dollars misappropriated from 1MDB, a Malaysian state-owned fund created to pursue economic growth opportunities for Malaysia and its people.  While Ng and his associates greedily lined their pockets, the Malaysian people were left as victims who potentially suffered lost economic growth opportunity.  The FBI and our partners remain committed to identifying those who choose to engage in foreign corrupt practices and bringing justice to them around the world,” stated FBI Assistant Director-in-Charge Driscoll.

“Today’s conviction of Roger Ng demonstrates the cooperation of law enforcement and prosecutorial agencies around the world to combat foreign corruption.  Roger Ng and his co-conspirators enriched themselves while depriving the citizens of Malaysia of billions of dollars that was supposed to be invested on their behalf,” stated IRS-CI Special Agent-in-Charge Ryan L. Korner.  “The Internal Revenue Service-Criminal Investigation is proud to stand with our law enforcement partners in the United States and around the world who participated in this most significant investigation.”

1MDB is a Malaysian state-owned and controlled fund created to pursue investment and development projects for the economic benefit of Malaysia and its people. 

Ng was employed as a Managing Director by various subsidiaries of Goldman Sachs and acted as an agent and employee of Goldman Sachs from approximately 2005 to May 2014. 

As proved at trial, between approximately 2009 and 2014, Ng conspired with others to launder billions of dollars misappropriated and fraudulently diverted from 1MDB, including funds 1MDB raised in 2012 and 2013 through three bond transactions it executed with Goldman Sachs, known as “Project Magnolia,” “Project Maximus” and “Project Catalyze.”  As part of the scheme, Ng and others, including Tim Leissner, the former Southeast Asia Chairman and participating managing director of Goldman Sachs, conspired to pay more than a billion dollars in bribes to a dozen government officials in Malaysia and Abu Dhabi to obtain and retain lucrative business for Goldman Sachs, including the 2012 and 2013 bond deals.  They also conspired to launder the proceeds of their criminal conduct through the U.S. financial system by funding major Hollywood films such as “The Wolf of Wall Street,” and purchasing, among other things, artwork from New York-based Christie’s auction house including a $51 million Jean-Michael Basquiat painting, a $23 million diamond necklace, millions of dollars in Hermes handbags from a business based on Long Island, and a luxury real estate in Manhattan.

Ng, co-defendant Low Taek Jho, a wealthy Malaysian socialite also known as “Jho Low,” and their co-conspirators used Low’s close relationships with high-ranking government officials in Malaysia and Abu Dhabi to obtain and retain business for Goldman Sachs through the promise and payment of hundreds of millions of dollars in bribes.  In the course of executing the scheme, Ng conspired with others at Goldman Sachs to circumvent the investment bank’s internal accounting controls.  Through its work for 1MDB during that time, Goldman Sachs received approximately $600 million in fees and revenues, while Ng received $35 million for his role in the bribery and money laundering scheme.  In total, Ng and the other co-conspirators misappropriated more than $2.7 billion from 1MDB. 

The evidence at trial included testimony from 26 witnesses called by the government; emails, phone records and bank records showing the defendant’s share of the scheme’s criminal proceeds was transferred to a bank account held by an offshore shell company in the name of the defendant’s mother-in-law; travel records; and receipts for luxury items purchased with the criminal proceeds.

Low remains a fugitive.  In August 2018, Leissner pleaded guilty to a two-count criminal information charging him with conspiring to launder money and conspiring to violate the FCPA by both paying bribes to various Malaysian and Abu Dhabi officials and circumventing the internal accounting controls of Goldman Sachs. Leissner has been ordered to forfeit $43 million and shares of stock valued at more than $200 million.  Leissner is awaiting sentencing.

In October 2020, Goldman Sachs and Goldman Sachs (Malaysia) Sdn. Bhd. (GS Malaysia), its Malaysian subsidiary, admitted to conspiring to violate the anti-bribery provisions of the FCPA in connection with the scheme.  Goldman Sachs entered into a deferred prosecution agreement with the United States Attorney’s Office for the Eastern District of New York and the Department of Justice’s Criminal Division, Fraud Section and Money Laundering and Asset Forfeiture (MLARS), and GS Malaysia pleaded guilty in the U.S. District Court for the Eastern District of New York to a one-count criminal information.  Goldman Sachs also paid more than $2.9 billion as part of a coordinated resolution with criminal and civil authorities in the United States, the United Kingdom, Singapore, and elsewhere.

The investigation was jointly conducted by the FBI’s International Corruption Unit and IRS-Criminal Investigation.  The government’s criminal case is being handled by the Business and Securities Fraud Section of the United States Attorney’s Office for the Eastern District of New York and the Criminal Division’s Money Laundering and Asset Recovery Section (MLARS) and Fraud Section.  Assistant United States Attorneys Alixandra E. Smith, Drew G. Rolle and Dylan Stern, and Bank Integrity Unit Chief Jennifer E. Ambuehl of MLARS and Co-Principal Deputy Chief of the Fraud Section Brent Wible are prosecuting the case.  The Criminal Division’s Office of International Affairs provided critical assistance in this case. 

The Department also appreciates the significant cooperation and assistance provided by the U.S. Securities and Exchange Commission, and the Board of Governors of the Federal Reserve System along with the Federal Reserve Bank of New York.  The Department also appreciates the significant assistance provided by the government of Malaysia, including the Attorney General’s Chambers of Malaysia, the Royal Malaysia Police and NCB Interpol Malaysia.  The Department also appreciates the significant assistance provided by the Attorney General’s Chambers of Singapore, the Singapore Police Force-Commercial Affairs Division, the Office of the Attorney General of Switzerland, the Judicial Investigating Authority of the Grand Duchy of Luxembourg and the Criminal Investigation Department of the Grand-Ducal Police of Luxembourg.

The Defendant:

NG CHONG HWA (also known as “Roger Ng”)
Age:  49
Kuala Lumpur, Malaysia

E.D.N.Y. Docket No. 18-CR-538 (MKB)

Earlier today in federal court in Brooklyn, Bernard Raymond Augustine was sentenced by United States District Judge Sterling Johnson, Jr. to 20 years’ imprisonment for attempting to provide material support to a designated foreign terrorist organization, the Islamic State of Iraq and al-Sham (“ISIS” or “the Islamic State”).  Augustine, a U.S. citizen and California resident, was convicted by a federal jury after a one-week trial in August 2021. 

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.

“Today’s sentence ensures this dangerous defendant will not join ISIS as he tried to do in 2016, and testified at trial that he would do again if the jury acquitted him.  The trial evidence demonstrated that Augustine is a committed supporter of ISIS, that he glorified beheadings and other acts of terror, and that he intended to support the terrorist organization by encouraging more English speakers to join its ranks,” stated United States Attorney Peace. “Detecting and thwarting terrorism and keeping the people of this country safe will always be priorities of this Office.”  Mr. Peace praised the work of the FBI’s New York Joint Terrorism Task Force on the case.

“The sentence Mr. Augustine received today insures he will never achieve his stated ambition of joining ISIS and supporting the terrorist group's pursuit of its reprehensible goals.  Protecting our nation from terrorism in all its forms remains the FBI's top priority, and today's outcome is the latest example of our commitment to pursuing this mission both domestically and globally,” stated FBI Assistant Director-in-Charge Driscoll.

“Protecting our nation’s security is paramount, and this case illustrates our continued commitment to fight terrorism in every form, both here and abroad,” stated NYPD Commissioner Sewell.  “Any person who puts American lives at risk will be held accountable to the fullest extent of the law, and I want to thank the U.S. Attorney’s Office for the Eastern District of New York, the Justice Department’s National Security Division, the Federal Bureau of Investigation, the members of the FBI/NYPD Joint Terrorism Task Force, and everyone else who prevented this threat and kept Americans safe.”

The evidence at trial established that in February 2016, Augustine traveled from San Francisco, California to Northern Africa, with the goal of joining ISIS, a designated foreign terrorist organization.  After arriving in Tunisia, Augustine was detained by local authorities before he could make it to ISIS-controlled territory across the border in Libya.  He was returned to the United States in 2018 and prosecuted in the Eastern District of New York.

In the months leading up to his travel, Augustine watched ISIS propaganda, including videos glorifying ISIS’s violence, such as “The Flames of War.”  He conducted internet searches for, among other things, “how to safely join ISIS,” and reviewed websites related to ISIS recruitment practices, including one titled “How does a Westerner join ISIS? Is there a recruitment or application process?”  Augustine also posted numerous statements in support of ISIS and violent extremism, such as “the Islamic State is the true Islam,” “Muslims who leave the west . . . answer the call for the struggle, and march until they are victorious or martyred are the true believers,” and the ISIS caliphate “can’t be established and maintained except through the blood of the mujahideen who practice the true belief.” 

The defendant represented himself at trial and testified that he maintained his interest in supporting ISIS.  Augustine testified that ISIS videos of members executing Syrian captives and beheadings were “good” and “really cool.”  He admitted that one way he intended to provide material support to ISIS was to participate in ISIS propaganda videos, by providing the necessary English-language voice over.  When asked to confirm his testimony that he “would do it all again and would go back today,” Augustine responded, “No, tomorrow, when they let me off.” 

The government’s case is being handled by the Office’s National Security and Cybercrime Section.  Assistant United States Attorneys Craig R. Heeren, Josh Hafetz, and Jonathan E. Algor are in charge of the prosecution, with assistance provided by Trial Attorney Justin Sher of the Counterterrorism Section of the Department of Justice.

The Defendant:

BERNARD RAYMOND AUGUSTINE
Age: 25
Keyes, California

E.D.N.Y. Docket No. 18-CR-383 (SJ)

A California man was sentenced today to 20 years in prison for attempting to provide material support to a designated foreign terrorist organization, the Islamic State of Iraq and al-Sham, aka ISIS.

Bernard Raymond Augustine, 25, of Keyes, was convicted by a federal jury after a one-week trial in August 2021.

According to court documents and evidence presented at trial, in February 2016, Augustine traveled from San Francisco to Northern Africa with the goal of joining ISIS. After arriving in Tunisia, Augustine was detained by local authorities before he could make it to ISIS-controlled territory across the border in Libya. He was returned to the United States in 2018 and prosecuted in the Eastern District of New York.

In the months leading up to his travel, Augustine watched ISIS propaganda, including videos glorifying ISIS’s violence, such as “The Flames of War.” He conducted internet searches for, among other things, “how to safely join ISIS,” and reviewed websites related to ISIS recruitment practices, including one titled, “How does a Westerner join ISIS? Is there a recruitment or application process?” Augustine also posted numerous statements in support of ISIS and violent extremism, such as “the Islamic State is the true Islam,” “Muslims who leave the west . . . answer the call for the struggle, and march until they are victorious or martyred are the true believers,” and the ISIS caliphate “can’t be established and maintained except through the blood of the mujahideen who practice the true belief.” 

The defendant represented himself at trial and testified that he maintained his interest in supporting ISIS. Augustine testified that ISIS videos of members executing Syrian captives and beheadings were “good” and “really cool.” He admitted that one way he intended to provide material support to ISIS was to participate in ISIS propaganda videos by providing the necessary English-language voice over. When asked to confirm his testimony that he “would do it all again and would go back today,” Augustine responded, “No, tomorrow, when they let me off.” 

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-in-Charge Michael J. Driscoll of the FBI’s New York Field Office and Commissioner Keechant L. Sewell of the New York City Police Department made the announcement.

The FBI investigated the case.

Assistant U.S. Attorneys Craig R. Heeren, Josh Hafetz and Jonathan E. Algor for the Eastern District of New York prosecuted the case, with valuable assistance provided by Trial Attorney Justin Sher of the National Security Division’s Counterterrorism Section.

Two criminal complaints were unsealed today in federal court in the Eastern District of New York charging six defendants with conspiring to bribe correction officers employed by the New York City Department of Corrections (DOC) as part of contraband smuggling conspiracies. Correction Officers Krystle Burrell and Katrina Patterson, as well as Ashley Medina, Imani Matthews and Terrae Hinds were arrested earlier today, and their initial appearances are scheduled for this afternoon before United States Magistrate Judge Lois Bloom. Defendant Michael Ross is currently in New York State custody and will make his initial appearance at a later date.

Breon Peace, United States Attorney for the Eastern District of New York, Ricky J. Patel, Acting Special Agent-in-Charge, Homeland Security Investigations, New York Field Office (HSI), Jocelyn E. Strauber, Commissioner, New York City Department of Investigation (DOI), and Keechant L. Sewell, Commissioner, New York City Police Department (NYPD) announced the arrests and charges.

“The defendants, public servants on the City’s payroll, allegedly smuggled contraband, including cell phones and drugs, to incarcerated gang members at Rikers Island. The flow of contraband into our jails is a serious problem which puts inmates, fellow officers and potentially the public at risk,” stated United States Attorney Peace. “We will continue to root out corruption at Rikers Island and work to protect incarcerated individuals and correction officers in our jails.”

“As alleged, Burrell and Patterson, both New York City Correctional Officers, brought shame and disgrace to New York’s Boldest by putting the safety of fellow officers and inmates at risk by conspiring to introduce contraband at Rikers Island Correctional Facilities on behalf of known Bloods Gang members,” said HSI New York Acting Special Agent in Charge Patel. “The details in the complaint allege that both officers brazenly betrayed their oath to act with integrity and professionalism to create a safe environment in correctional facilities - their actions tarnish the great reputation of the men and women who put on the uniform of a New York City Correction Officer and risk their lives on a daily basis. HSI New York’s Violent Gang Task Force, with our local and federal partners, will continue to conduct violent crime and gang investigations throughout the New York City area to ensure those perpetrating criminal activities in any manner are held accountable.”

DOI Commissioner Strauber said, “As alleged, these correction officers facilitated the illegal entry of drugs and cellphones into the City’s jails in exchange for thousands of dollars in bribes, enriching themselves at the expense of the safety and security of inmates as well as their fellow officers. The contraband trade fuels violence that endangers inmates and staff, and undermines the rules and regulations intended to maintain order on Rikers Island. DOI is committed to continued collaboration with our law enforcement partners in the United States Attorney’s Office for the Eastern District of New York, the New York Field Office of Homeland Security Investigations, and the New York City Police Department to expose and stop this type of corruption that destabilizes the City’s jails.”

“The charges detailed in today’s federal complaints reflect an intolerable betrayal of public trust – including by those who allegedly abandoned their sworn oath to uphold the law,” said Police Commissioner Sewell. “I commend our NYPD officers, along with our law enforcement partners and the prosecutors in the U.S. Attorney’s Office for the Eastern District of New York, for working together to build this important case.”

HSI, DOI and the NYPD have been investigating contraband smuggling rings involving the payment of bribes to DOC officers in exchange for smuggling contraband, including unauthorized cell phones and narcotics, to Bloods gang members on Rikers Island.

As alleged in one complaint, New York City Correction Officer Katrina Patterson accepted at least $34,090 in bribes from Ashley Medina and Imani Matthews on behalf of Michael Ross in exchange for Patterson smuggling contraband into the Robert N. Davoren Center on Rikers Island for Ross. Ross, who was incarcerated on unrelated offenses, arranged for the bribes to be sent to Patterson. DOC subsequently located narcotics and cell phones in Ross’ cell. In addition to obtaining surveillance video from Rikers Island showing Patterson bringing unauthorized items to Ross, law enforcement also seized Patterson’s text messages, including messages with Matthews where Matthews told Patterson that some of the contraband would be “4 black joints in 1 paper,” and Patterson responded, “it better be wrapped so many times I don’t want to smell it.” Patterson and Matthews also discussed the need to delete their text messages.

As alleged in a separate complaint, New York City Correction Officer Krystle Burrell accepted bribes in exchange for smuggling contraband into the Anna M. Kross Center on Rikers Island for Terrae Hinds, facilitating Hinds’ contraband smuggling business and permitting Hinds and others to violate DOC regulations. Hinds, who was incarcerated on unrelated offenses, arranged for approximately $9,780 in bribe payments to be sent to Burrell. In exchange, Burrell smuggled at least two unauthorized cell phones to Hinds, and also facilitated Hinds’ sale of narcotics and other contraband items at the Anna M. Kross Center.

The charges in the complaints are allegations, and the defendants are presumed innocent unless and until proven guilty. If convicted, the defendants each face a maximum sentence of five years’ imprisonment.

The government’s case is being handled by the Office’s Public Integrity Section and prosecuted by Assistant United States Attorney Philip Pilmar.

The Defendants:

KATRINA PATTERSON
Age: 31
Jamaica, NY

IMANI MATTHEWS
Age: 25
Bronx, NY

ASHLEY MEDINA
Age: 24
Bronx, NY

MICHAEL ROSS
Age: 36
Comstock, NY

E.D.N.Y. Docket No. 22-MJ-377

KRYSTLE BURRELL
Age: 35
Lawrence, NY

TERRAE HINDS
Age: 28
Yonkers, NY

E.D.N.Y. Docket No. 22-MJ-378

A criminal complaint was unsealed today in federal court in Brooklyn charging Steven Labianca with the sexual exploitation of children.  The charges relate to sexually explicit images and videos of children that the defendant requested and received from minors that he targeted on Skype.  Labianca was arrested this morning and will make his initial appearance this afternoon before United States Magistrate Judge Lois Bloom.

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.

“As alleged, Labianca preyed on minors online, developing a relationship with them first, then exploiting them by enticing the victims to take sexually explicit photos and videos of themselves for the defendant’s own personal gratification,” stated United States Attorney Peace.  “Today’s arrest underscores the importance of monitoring our children’s Internet activity and teaching them to say ‘no’ to inappropriate requests in the real world and online.  Fighting child exploitation is a priority for the Department of Justice and this Office will continue to make every effort to ensure that those who contribute to the victimization of children will be brought to justice.” 

“The behavior in which we allege Mr. Labianca engaged - soliciting and receiving sexually-explicit images and videos from children as young as 13 - is depraved, and it underscores the dangers children may face online,” stated FBI Assistant Director-in-Charge Driscoll.  “The action we've taken today will ensure Mr. Labianca faces justice for his crimes, but our investigation continues.  We implore anyone who may have information about this case to call as at 1-800-CALL-FBI or reach us online at tips.fbi.gov.” 

As set forth in court filings, Labianca was using a Skype account with the account name “Original Geek” and an Instagram account with the account name “haulsropefasterr.”  Between April 2017 and February 2021, Labianca allegedly engaged in a series of sexually explicit Skype communications with at least eight underage victims, ages 13 to 17, who lived within the United States and abroad.  Labianca directed the victims to perform sexual acts while participating in the video calls.  Labianca also directed the children to take nude photos and videos of themselves and send them to him.  Several victims did in fact send sexually explicit photos and videos to Labianca.

If convicted of sexual exploitation of a child, Labianca faces a mandatory minimum sentence of 15 years’ imprisonment.  The charges in the complaint are allegations, and the defendant is presumed innocent unless and until proven guilty.

This prosecution is part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse.  Led by United States Attorneys’ Offices and the Department of Justice Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims.  For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.

The government’s case is being handled by the Office’s Public Integrity Section. Assistant United States Attorney Olatokunbo Olaniyan is in charge of the prosecution.

The Defendant:

STEVEN LABIANCA
Age:  49
Midwood, Brooklyn

E.D.N.Y. Docket No. 21-MJ-386

Jason Peltz pleaded guilty today in federal court in Brooklyn to securities fraud and tax evasion in connection with an insider trading scheme in which Peltz executed securities transactions based on material nonpublic information (MNPI) from a company insider. The proceeding was held before United States District Judge Nicholas G. Garaufis. When sentenced, Peltz faces up to 25 years in prison, forfeiture of his ill-gotten gains, and restitution to the Internal Revenue Service (IRS) of over $1 million.     

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 Thomas Fattorusso, Special Agent-in-Charge, IRS Criminal Investigation, New York (IRS-CI), announced the guilty plea.

“With today’s plea, Peltz admitted to trading on material nonpublic information about a publicly traded company to line his own pockets and also to lying about his income to avoid paying taxes on a substantial tax liability,” stated United States Attorney Peace.  “This Office will vigorously prosecute traders who seek to cheat the system, harm the investing public and undermine the integrity of our financial markets.  We will hold accountable those who lie to avoid paying their fair share of taxes.” 

Mr. Peace thanked the Securities and Exchange Commission, New York Regional Office, for their assistance during the investigation. 

“Plain and simple. It's illegal to use non-public information to buy and sell stocks. Doing so manipulates the markets and can have detrimental effects on the wallets of individuals who play by the rules.  But this defendant didn't stop there, he made significant financial gains and then claimed that he had no income in an effort to blatantly evade taxes,” stated IRS-CI Special Agent-in-Charge Fattorusso. 

In February 2016, Peltz obtained MNPI from an insider at Ferro Corporation (“Ferro”) about a potential takeover offer (the “Ferro Takeover Bid”). Peltz used that MNPI to:

• Profitably trade in Ferro in the brokerage accounts of two co-conspirators,
• Tip other individuals, each of whom also profitably traded on MNPI about the Ferro Takeover Bid, and
• Tip a reporter, who wrote an article making public the news of the Ferro Takeover Bid, which resulted in an increase in the price of Ferro’s stock.

Peltz and the Ferro insider each received significant financial benefits from other co-conspirators shortly after Peltz traded in those co-conspirators’ brokerage accounts, and Peltz continued to receive large payments from co-conspirators, as well as other benefits, as payment for his trading activity. Peltz directed that these payments be made to corporate and nominee bank and credit card accounts, in order to conceal his income from the IRS. Despite receiving such payments, in 2017 Peltz falsely swore under penalty of perjury to the IRS that he had been unemployed since December 2015 and had no income. 

The government’s case is being handled by the Office’s Business and Securities Fraud Section. Assistant United States Attorneys Kaitlin T. Farrell, Sarah M. Evans, and Special Assistant United States Attorney Barry O’Connell are in charge of the prosecution, with assistance from Assistant United States Attorney Brian Morris of the Office’s Asset Recovery Section.

The Defendant:

JASON PELTZ
Age: 39
Brooklyn, New York

E.D.N.Y. Docket No.  21-CR-154 (NGG)

Breon Peace, United States Attorney for the Eastern District of New York, and Letitia James, New York State Attorney General, announced today a pair of settlement agreements with two Brooklyn-based licensed home care services agencies (LHCSA), All American Homecare Agency (All American) and Crown of Life Care NY LLC (Crown of Life). The settlement agreements address allegations that All American and Crown of Life violated the federal False Claims Act and New York State’s False Claims Act in claiming that they paid their home care aides the minimum wages required under New York State law. The agencies received millions of dollars in funding from Medicaid, which is funded in part by the federal government, and much of that money was meant to pay the wages and benefits of their aides.

“It is outrageous to cheat home health aides of their hard earned benefits guaranteed under New York law and the Medicaid program,” stated United States Attorney Breon Peace.  “These settlements reflect this Office’s firm commitment to preventing fraud in government programs and protecting home health aides—who perform physically and emotionally taxing work in caring for some of the members of our community most in need.” 

Mr. Peace thanked the Medicaid Fraud Control Unit of the Office of the New York State Attorney General for its partnership in the government’s investigation and resolution of this important case.  

“Home health aides provide critical care for our most vulnerable, and they must be fairly compensated for their work,” said Attorney General James.  “Not only did these companies shamelessly cheat their workers, they also cheated our state and stole from communities that need it most. My office will never tolerate fraud of any kind, and we will continue to do everything we can to ensure that New Yorkers get their fair pay and treatment.”

The New York Wage Parity Act, Public Health Law sets minimum wage and benefit requirements for LHCSAs that employ home care aides who render services to Medicaid recipients in New York City and in Nassau, Suffolk or Westchester Counties.  Under the Wage Parity Law, which is funded by Medicaid aides are to be paid a minimum amount in total compensation. That compensation comes in the form of a base wage and a supplemental benefit. The base wage must be paid in cash. The benefit portion can include the value of vacation, holiday, and sick pay, among other things.  It can also include health insurance, pension plans, or educational assistance. Today, the minimum amount of total compensation for an aide in New York City is $19.09 per hour; for Nassau, Suffolk, and Westchester Counties, the minimum is $18.22 per hour.

Home health aides perform all aspects of personal care for sick or homebound patients and frequently work long shifts lasting up to 24 hours.  The tasks performed in caring for patients are demanding and can consist of assisting or lifting patients out of bed and bathing, dressing, grooming, preparing meals and, in some instances, feeding them.  Patients may suffer from physical or mental disorders that can make the work of the aides physically and emotionally taxing.  In fact, it was in recognition of the difficulty of this work that New York passed the Wage Parity Law. 

This Office, in coordination with the New York State Attorney General’s Office’s Medicaid Fraud Control Unit, commenced an investigation after whistleblowers alleged that certain LHCSAs had knowingly defrauded the federal government and New York State by underpaying home health aides in violation of New York’s Wage Parity Act.  The government’s investigation revealed that All American and Crown of Life falsely certified their compliance with the law and sought and received reimbursement from Medicaid. 

Under the terms of its agreements with the United States and New York State, All American has paid $1.6 million to the United States and $2.4 million to New York State. The settlement covers All American’s conduct in the years 2014 to 2017. Crown of Life has agreed to pay $560,000 to the United States and $840,000 to New York State, for conduct that took place in the years 2014 to 2018. 

In addition to the payments to resolve the government’s fraud claims, All American and Crown of Life are now paying their aides the wages and benefits they were required to pay under the Wage Parity Law, including the wages that were owed to current and former aides in prior years. Moreover, both All American and Crown have admitted, acknowledged and accepted responsibility for underpaying their home health aides by failing to pay Wage Parity Law rates.   

The case is being handled by Assistant U.S. Attorneys Michael Blume and Sean Greene-Delgado of the Office’s Civil Division. Assistant U.S. Attorney Matthew Mailloux, now with the District of New Jersey, handled the matter when he was with the Eastern District of New York.

Breon Peace, United States Attorney for the Eastern District of New York and Lisa Garcia, Regional Administrator of the U.S. Environmental Protection Agency (EPA) Region 2, announced that the United States has entered into a Consent Judgment settling a civil lawsuit against Genesis Petroleum, Inc. and 20 associated companies (Defendants), for violating the Resource Conservation and Recovery Act (RCRA) in connection with their ownership or operation of underground storage tanks (USTs) at 13 gas stations in New York and New Jersey. The Consent Judgment requires the Defendants to adequately detect leaks of petroleum product from USTs, and to implement other safety measures, across their facilities in New York and New Jersey. The settlement also requires Defendants to pay a civil penalty of $250,000.

“Genesis Petroleum flagrantly disregarded measures required by law that are designed to protect the health and safety of the communities in which it operates its gas stations.  Leaks from underground storage tanks can contaminate drinking water supplies, pollute surrounding soil and surface waters as well as groundwater, and impact indoor airspaces,” stated United States Attorney Peace.  “This settlement reaffirms this Office's commitment to safeguarding public health, preserving the environment, and promoting environmental justice in partnership with the EPA.” 

“This settlement protects communities across New York and New Jersey by significantly improving how these businesses manage underground storage tanks,” stated EPA Regional Administrator Garcia.  “If underground storage tanks leak, they can pose a serious problem because they can contaminate groundwater, and the risk can be heightened when owners and operators of USTs fail to comply with EPA’s regulatory requirements.  Underground storage tanks are important business infrastructure and are essential for fueling vehicles but when these tanks are not properly maintained or repaired, communities and the environment can be at risk from leaks of hazardous substances.”

Petroleum products such as gasoline contain chemical compounds that pose substantial threats to human health. Service stations typically store gasoline in USTs. When operated conscientiously and monitored closely, USTs are a safe and effective means to store gasoline.  But when those tanks are not subjected to basic operational safeguards, they can endanger the public and the environment, for example by leaking the contents of their tanks into the water supply, discharging toxic vapors into the air, or even triggering fires or explosions.

EPA’s regulations under RCRA are designed to protect the public by requiring underground storage tank operators to reduce the likelihood of leaks, monitor for leaks so they can promptly be addressed, and maintain adequate insurance to conduct corrective action and compensate injured third parties should a leak occur.

The Consent Judgment, which is subject to public comment and approval by the district court, resolves a lawsuit filed by the United States in June 2019, which alleges that the Defendants repeatedly violated RCRA and related regulations at various times between 2012 and 2016 with respect to their ownership and/or operation of underground storage tanks at 13 gas stations. Twelve of the Defendants’ facilities covered by the Consent Judgment are located in low-income areas and communities of color that are exposed to disproportionate environmental burdens.

The United States alleges that the Defendants failed to perform required actions including:

• failure to install and use spill prevention equipment at three facilities;
• failure to use overfill prevention equipment at three facilities;
• failure to provide release detection for underground storage tanks at three facilities;
• failure to provide release detection for pressurized piping at six facilities;
• failure to test automatic line leak detectors at nine facilities;
• failure to report suspected releases at three facilities;
• failure to perform release detection for underground storage tanks that were temporarily closed but still contained more than three feet of petroleum products at one facility;
• failure to timely provide records of release detection monitoring at ten facilities;
• failure to timely respond to requests for information issued by EPA at 13 facilities; and
• failure to maintain financial responsibility and evidence of financial responsibility at seven facilities. 

Pursuant to the Consent Judgment, Defendants are required to comply with the regulations applicable to USTs for all tanks at 29 facilities at which they currently own or operate underground storage tanks in New York and New Jersey. The Consent Judgment requires Defendants to implement significant measures to ensure such compliance, including undertaking inspections, maintaining and operating a federally approved release detection method at all underground storage tanks at the facilities, maintaining a properly functioning and operational overfill prevention system for new tanks and providing semi-annual reports to EPA.

The Consent Judgment will be lodged with the District Court for a period of at least 30 days and notice of the Consent Judgment will be published in the Federal Register before the Consent Judgement is submitted for the Court’s approval.  This will afford members of the public the opportunity to submit comments on the Consent Judgement to the Department of Justice.

In June 2021, the United States Attorney’s Office for the Eastern District of New York created an Environmental Justice Team within the Office’s Civil Division. The focus of the Environmental Justice Team is the protection of the rights of residents of the Eastern District of New York who are disproportionately burdened by environmental and health hazards. 

This matter is being handled by Assistant U.S. Attorneys Jolie Apicella and Paulina Stamatelos with assistance from Paralegal Specialist Mary Ellen Buntin of the United States Attorney’s Office for the Eastern District of New York, working with Lee Spielmann, Assistant Regional Counsel, EPA Region 2, and Hiep Tran, Enforcement Officer, EPA Region 2.

E.D.N.Y. Docket No. 19-CV-3340 (JS)

The Defendants:

Genesis Petroleum, Inc.

Technic Management, Inc.

Gulden Inc.

2664 RT 112 Realty Corp.

607 Station Road Realty Inc.

1000 Motor Parkway Central Islip LLC

616 Broadway LLC

Freeport Realty LLC

199 E. Sunrise Highway Realty Corp.

465 Nassau Road Realty Corp.

Camlica, Inc.

Kucukbey Corp.

North Country Road Realty LLC

Elizabeth NJPO LLC

Elizabeth NJPG LLC

Perth Amboy NJPO LLC

Perth Amboy NJPG LLC

Newark NJPO LLC

Newark NJPG LLC

North Bergen NJPO LLC

North Bergen NJPG

Gas Stations in the Complaint:

2664 Route 112, Medford, New York

607 Station Road, Bellport, New York

87 North Country Road, Miller Place, New York

616 Route 110, Amityville, New York

6077 Jericho Turnpike, Commack, New York

199 E. Sunrise Highway, Freeport, New York

131 West Merrick, Freeport, New York

465 Nassau Road, Roosevelt, New York

261 East Merrick Road, Freeport, New York

507 Bayway Avenue, Elizabeth, New Jersey

163 Fayette Street, Perth Amboy, New Jersey

66-80 Bloomfield Avenue, Newark, New Jersey

8012 Tonnelle Avenue, North Bergen, New Jersey

Gas Stations Subject to the Consent Judgment:

2664 Route 112, Medford, NY

607 Station Road, Bellport, NY

87 North Country Road, Miller Place, NY

616 Route 110 (Broadway Road), Amityville, NY

199 East Sunrise Highway, Freeport, NY

131 West Merrick Road, Freeport, NY

465 Nassau Road, Roosevelt, NY

11 Station Road, Bellport, NY

315 Route 112, Port Jefferson, NY

1575 Route 112, Port Jefferson, NY

4290 Austin Blvd., Island Park, NY

303 Maple Avenue in Smithtown, NY

2394 Boston Post Road, Larchmont, NY

2149 Boston Post Road, Larchmont, NY

747 Main Street, New Rochelle, NY

8012 Tonnelle Avenue, North Bergen, NJ

2 Marlton Pike W, Cherry Hill, NJ

4915 Route 130 & Browning Road, Pennsauken, NJ

1422 W. Landis Avenue, Vineland, NJ

520 E. Commerce Street, Bridgeton, NJ

3731 Bay Shore Road, Lower Township, NJ

515 S. Pennsville-Auburn Road, Carneys Point, NJ

632 2nd Avenue, Long Branch, NJ

379 Quaker Church Road, Randolph, NJ 

1839 Admiral Wilson Blvd., Camden, NJ

509 Route 47S, Cape May, NJ

1651 Route 38 & 464 Pine Street, Mount Holly, NJ

615 Pearl Street N., Bridgeton, NJ

3422 S. Delsea Drive, Vineland, NJ

Earlier today, at the federal courthouse in Brooklyn, Luis Taveras was sentenced by United States District Judge Kiyo A. Matsumoto to 17 years’ imprisonment for attempting to commit obstruction-of-justice murder.  Taveras pleaded guilty to the charge in January 2020. 

Breon Peace, United States Attorney for the Eastern District of New York; Ricky J. Patel, Acting Special Agent-in-Charge, Homeland Security Investigations, New York (HSI); Tim Foley, Acting Special Agent-in-Charge, Drug Enforcement Administration, New York Division (DEA); Keechant L. Sewell, Commissioner, New York City Police Department (NYPD); and Kevin P. Bruen, Superintendent, New York State Police (NYSP), announced the sentence.

“The defendant planned the cold-blooded execution of a witness he believed to be cooperating with U.S. law enforcement, and watched as the witness and members of his family, including a 5-year-old, were shot and wounded.  By his callous disregard for human life and brazen contempt for the law, Taveras has earned the lengthy prison term imposed today,” stated United States Attorney Peace.  “I commend and thank the Organized Crime Drug Enforcement Task Force for their tireless efforts to bring the defendant to justice for this horrific crime.”

“Taveras tried to silence a potential witness to eliminate the chances of their cooperation with U.S. law enforcement.  In a daring public attempt, Taveras tried to gun down the individual in a crowded Colombian restaurant, wounding three victims including a 5-year-old boy,” stated HSI Acting Special Agent-in-Charge Patel.  “This callous act of extreme violence and blatant disregard for human life resulted in today’s stiff sentence to land Taveras in federal prison for 17 years.  HSI New York, working with our law enforcement partners will continue to tirelessly pursue the most dangerous offenders and prosecute those who seek to obstruct justice, both domestically and on foreign soil.”

“Luis Taveras’ actions were nothing less than cold-blooded and this sentence cements the gravity of his crimes.  The relentless nature of law enforcement has resulted in bringing Taveras to justice to face the consequences of his actions.   I applaud the U.S. Attorney’s Office Eastern District of New York, the New York City Police Department, the New York State Police, and Homeland Security Investigations for their diligent work and continued collaboration with the DEA New York Division,” stated DEA Special Agent-in-Charge Foley.

 “A measure of justice was meted out today against Luis Taveras, whose admitted crimes not only victimized a family, including an innocent child, but sought to upend the sanctity of our collective law enforcement system,” stated NYPD Commissioner Sewell.  “His sentencing reflects the commitment of our NYPD investigators and partners, including in the United States Attorney’s Office in the Eastern District of New York, to never relent in our work to eradicate drug traffickers and the harm they propel at home and abroad.”

“This is a clear-cut case in which this suspect attempted to take out a witness who had information regarding his criminal activity, while completely disregarding the safety of innocent family members, including a young child. I want to thank our law enforcement partners for their continued partnership, and the US Attorney for ensuring that the defendant is held fully accountable for his actions,” stated NYSP Superintendent Bruen,

As detailed in court filings and the defendant’s statements at his guilty plea proceeding, Taveras arranged for the murder of an individual whom he knew from prior narcotics transactions and believed to be cooperating with U.S. law enforcement.  On June 21, 2016, Tavares entered a restaurant in Cali, Colombia, and sat down at a table with the victim.  Shortly thereafter, Taveras stood up, walked to the back of the restaurant, and watched as a co-conspirator entered the restaurant and fired eight shots – wounding the victim in the shoulder and arm, and also wounding two family members of the victim, including a five-year-old child.  Taveras and his co-conspirator then fled.  The three victims survived their wounds. 

Taveras was arrested in February 2019 by federal law enforcement agents in Miami.  During his guilty plea proceeding, Tavares admitted that he identified the intended target to his co-conspirator, and that he wanted to prevent that individual from providing information to U.S. law enforcement.

This prosecution 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 Office’s International Narcotics and Money Laundering Section.  Assistant United States Attorney Erin Reid is in charge of the prosecution.

The Defendant:

LUIS TAVERAS
Age:  33
Miami, Florida

E.D.N.Y. Docket No. 19-CR-180 (S-2) (KAM)

Earlier today, a superseding indictment was unsealed in federal court in Central Islip charging 11 members of the violent transnational criminal organization La Mara Salvatrucha, also known as the MS-13, with racketeering conspiracy, including predicate racketeering acts involving murder, attempted murder, conspiracy to commit murder, robbery, witness tampering and witness retaliation, and related narcotics and firearms offenses. Four of the defendants were charged with committing the April 11, 2021 murder of Nazareth Claure in Far Rockaway, New York, whose body was recovered from the trunk of a car.

Three of the defendants – Onan Garcia-Lopez, also known as “Demente,” David Alberto Orantez-Gonzalez, also known as “Carlos Rodriguez-Gonzalez” and “Casper,” and Carlos Torres-Alfaro, also known as “Solitario,” – were arrested today and will be arraigned this afternoon by United States Magistrate Judge Steven I. Locke.

The other eight defendants, Billy Ayala-Pineda, also known as “Berdugo,” and Wilian Estiven Sanchez-Perez, also known as “Maniako,” who were charged in the underlying indictment, and Anander Henriquez-Avila, also known as “Cara Papa” and “El Papa,” Allan Lopez-Villeda, also known as “Serio,” and “Casper,” Carlos Ramirez-Portillo, also known as “Chino” and “Siniestro,” Jose Sarmiento-Valeriano, also known as “David,” Henry Vasquez-Padilla, also known as “Trece,” Rigel Yohario Velasquez-Mancia, also known as “E,” were already in federal and state custody and will be arraigned at a later date.

Breon Peace, United States Attorney for the Eastern District of New York (EDNY); Ricky J. Patel, Special Agent-in-Charge, Homeland Security Investigations, New York (HSI); Keechant L. Sewell, Commissioner, New York City Police Department (NYPD); and John J. Durham, Director, Joint Task Force Vulcan, announced the arrests and charges in the superseding indictment.

“The significant federal charges in the superseding indictment, including the brutal murder of a mother whose body was wrapped in trash bags, underscores the cruel depravity and senseless violence of the MS-13 gang,” stated United States Attorney Peace. “With this indictment and additional arrests, this Office has taken another step in seeking justice for the murder victim and her family, and we will not rest until the threat of the MS-13 gang is eliminated for good from our communities.”

Mr. Peace also thanked the Queens County District Attorney’s Office, the Nassau County District Attorney’s Office, the Nassau County Police Department, the United States Marshals Service Regional Fugitive Task Force, and the Border Enforcement Security Task Force of HSI Boston for their work on the investigations.

“As alleged, the savagery and brutality of the crimes committed by some of the individuals named in the indictment is beyond comprehension and involves the murder of young woman, who was wrapped in a plastic bag and placed in the trunk of a car like an object instead of a young mother and human being,” said Homeland Security Investigations, Acting Special Agent in Charge Ricky J. Patel.  “Today’s superseding indictment and arrests send a clear message that violent gang members who commit such deplorable and cowardly crimes against humanity will be tracked down and held accountable for their actions.  HSI New York’s Transnational Violent Gangs Task Force, working with our law enforcement and prosecutorial partners will continue to tirelessly pursue the most dangerous offenders and bring them to justice.”

“Today’s announcement highlights the NYPD’s commitment to working with all of its law enforcement partners to dismantle transnational criminal organizations like MS-13, which routinely use violence and intimidation to prey upon vulnerable communities,” said NYPD Commissioner Sewell. “By contributing our unique capabilities to this joint effort, the NYPD continues to remove vicious gang members from the streets of New York and protect the people we serve from the unthinkable harm alleged in this indictment.”

As alleged in the superseding indictment, MS-13 is a transnational criminal organization composed primarily of immigrants or descendants of immigrants from El Salvador, but also includes members from other countries such as Honduras, Guatemala and Mexico. Although the gang originated in Los Angeles, California, it quickly spread and is now a national and international criminal organization with an estimated 10,000+ members regularly conducting gang activities in nearly all of the United States, including New York, and in El Salvador, Honduras, Guatemala, and Mexico.

MS-13 cliques are organized together under umbrella groups, called “Programs.”  Cliques within a Program were responsible for assisting one another with firearms, drug trafficking connections, territorial disputes with rival gangs, and providing safe havens for members who were wanted by law enforcement.  One of the MS-13 Programs operating in the United States is the Los Angeles Program (or “LA Program”).

As further alleged in the superseding indictment, Ayala-Pineda, who was charged in the underlying indictment and arrested on December 15, 2021, was the highest-ranking member (or “First Word”) of the Surenos Locos Salvatruchas (“SLS”) clique operating in Queens and Long Island, New York and a leader of the LA Program operating in the United States. Ayala-Pineda directed the SLS clique’s drug trafficking activity, acts of violence committed against rival gang members and against members and associates of the gang who Ayala-Pineda deemed to have been disloyal to the gang, and the SLS clique’s acquisition of firearms. The other ten defendants all were members and associates of the MS-13 and involved in trafficking narcotics and committing acts of violence in furtherance of the gang’s objectives in conjunction with the SLS clique.

All 11 defendants are charged with racketeering conspiracy for their participation in MS-13 crimes, including murder, robbery, witness tampering, witness retaliation, drug trafficking, and related conspiracy, attempt and firearms offenses. In addition, Henriquez-Avila, Lopez-Villeda, Sarmiento-Valeriano, and Velasquez-Mancia, are charged with the murder of  Claure, on or about April 11, 2021 in Queens, New York. In the early morning hours of April 13, 2021, Lopez-Villeda, Sarmiento-Valeriano, and Velasquez-Mancia were pulled over during a car stop by the NYPD and HSI in Queens, New York. Ms. Claure’s body was discovered in the trunk of the car wrapped in trash bags. In addition to the murder, the Indictment charges all the defendants with conspiring to distribute cocaine, oxycodone, and marijuana, as well as their use and possession of firearms in furtherance of their narcotics trafficking. These charges stem from the MS-13 clique’s street-level sales of narcotics on Long Island, the proceeds of which were used to help finance the MS-13’s criminal operations, which is evidenced by financial records of money sent back to El Salvador and Mexico.

Today’s superseding indictment is the latest in a series of federal prosecutions by the United States Attorney’s Office for the Eastern District of New York targeting members of the MS-13, a violent, transnational criminal organization. The MS-13’s leadership is based in El Salvador, Honduras, Guatemala and Mexico, but the gang has thousands of members across the United States. With numerous branches, or “cliques,” the MS-13 is the most violent criminal organization on Long Island. Since 2003, hundreds of MS-13 members, including dozens of clique leaders, have been convicted on federal felony charges in the Eastern District of New York. A majority of those MS-13 members have been convicted on federal racketeering charges for participating in murders, attempted murders and assaults. Since 2010, this Office has obtained indictments charging MS-13 members with carrying out more than 60 murders in the Eastern District of New York, and has convicted more than 100 MS-13 leaders and members in connection with those murders.

This superseding indictment is the product of coordination between EDNY and Joint Task Force Vulcan (JTFV), which was created in August 2019 as a whole-of-government approach to dismantle transnational criminal organizations, such as MS-13.Since its creation, JTFV has successfully increased coordination and collaboration with foreign law enforcement partners, including El Salvador, Mexico, Honduras and Guatemala; designating priority MS-13 programs, cliques and leaders, who have the most impact on the United States, for targeted prosecutions; and coordinating 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 in El Salvador. JTFV has been comprised of members from U.S. Attorney’s Offices across the country, including the EDNY; the Southern District of New York; the District of New Jersey; the Northern District of Ohio; the District of Utah; the Eastern District of Virginia; the District of Massachusetts; the Eastern District of Texas; the District of Alaska; the Southern District of Florida; the Southern District of California; the District of Nevada; 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 Federal Bureau of Investigation; 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.

 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 the Claure murder are eligible for the death penalty.

The government’s case is being prosecuted by Assistant U.S. Attorney Jacob Warren from JTFV and the United States Attorney’s Office for the Southern District of New York, and Assistant U.S. Attorneys Paul G. Scotti, Justina L. Geraci and Megan E. Farrell from the EDNY’s Long Island Criminal Division. The charges in the Superseding Indictment were investigated by the Violent Gang Task Force of HSI and the NYPD.

The Defendants:

Billy Ayala-Pineda (“Berdugo”)
Age: 31
Long Island, New York

Onan Garcia-Lopez (“Demente”)
Age: 20
Long Island, New York

Anander Henriquez-Avila (“Cara Papa” and “El Papa”)
Age: 29
Queens, New York

Allan Lopez-Villeda (“Serio”)
Age: 23
Queens, New York

David Alberto Orantes-Gonzalez (“Carlos Rodriguez Gonzalez” and “Casper”)
Age: 24
Queens, New York

Carlos Ramirez-Portillo (“Chino”)
Age: 21
Queens, New York

Wilian Estiven Sanchez-Perez (“Maniako”)
Age: 21
Queens, New York

Jose Sarmiento-Valeriano (“David”)
Age: 22
Long Island, New York

Carlos Torres-Alfaro (“Solitario”)
Age: 20
Queens, New York

Henry Vasquez-Padilla (“Trece”)
Age:  26
Queens, New York

Rigel Yohairo Velasquez-Mancia (“E”)
Age: 21
Queens, New York

E.D.N.Y. Docket No.: 21-CR-635 (S-1)(JMA)

Earlier today, in federal court in Central Islip, Konstantinos Zarkadas, a Glen Cove-based medical doctor, was sentenced by United States District Judge Gary R. Brown to 51 months’ imprisonment for fraudulently obtaining millions of dollars in COVID-19 emergency relief funds.  The Court also ordered Dr. Zarkadas to pay approximately $3.5 million in restitution.  Dr. Zarkadas pleaded guilty in November 2021 to disaster relief fraud and wire fraud in connection with his receipt of small business loans under the Paycheck Protection Program (PPP) and Economic Injury Disaster Loan Program (EIDLP). As part of the plea agreement, Dr. Zarkadas forfeited $200,000 and four luxury wristwatches.

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 Thomas Fattorusso, Jr., Special Agent-in-Charge, Internal Revenue Service Criminal Investigation, New York (IRS-CI), announced the sentence.

“Today’s sentence demonstrates there are consequences for those who treat vital government programs as cash give-a-ways and shamefully seek to profit from an unprecedented public health crisis,” stated United States Attorney Peace.  “This Office will vigorously prosecute and bring to justice medical professionals like the defendant and other fraudsters who are driven by greed to maintain a lavish lifestyle at the expense of small businesses in legitimate need of COVID-19 emergency assistance.”

“It’s a shame to see rampant abuse of programs designed to help ordinary people struggling through the pandemic.  Dr. Zarkadas chose greed over honesty by financing a luxury lifestyle on the backs of America’s taxpayers,” stated IRS-CI Special Agent-in-Charge Fattorusso.  “Thanks to the investigative work of IRS-CI and the FBI, he’ll sail straight to federal prison instead of onboard his $1.7 million yacht that was illegally purchased with CARES Act funds.”

Between March 2020 and July 2020, amid the COVID-19 pandemic, Dr. Zarkadas fraudulently applied for, and received based on the false information that he provided, at least 11 PPP and EIDLP loans totaling approximately $3,700,000, on behalf of corporate entities he controlled.  Dr. Zarkadas laundered the loan proceeds through various bank accounts, ultimately using the funds for extravagant personal purchases and other impermissible purposes.  For example, in July 2020, Dr. Zarkadas used approximately $194,915.42 in PPP funds to finance the down payment on a $1.75 million yacht.  To conceal the fraudulent nature of the purchase, Dr. Zarkadas made the check payable to a family member who was not the ultimate beneficiary of the funds and, in the check’s memo line, falsely indicated the funds were “repayment for payroll.”  Dr. Zarkadas also withdrew tens of thousands of dollars’ worth of loan proceeds in cash and used some of the proceeds to satisfy more than $1 million in judgments against him, to lease luxury automobiles, and to make personal purchases, including several Rolex and Cartier wristwatches which he forfeited as part of his guilty plea in this case.   

Congress created the PPP and EIDLP as part of the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act.   Enacted on March 29, 2020, the CARES Act provided emergency financial assistance in connection with economic effects of the COVID-19 pandemic.  One source of relief provided by the CARES Act was the allocation of funds for the issuance of forgivable loans to small businesses for job retention and certain other expenses through the PPP.  The PPP allowed qualifying small businesses to receive unsecured loans on favorable terms, which they were required to use for specified expenses, including payroll costs, interest on mortgages, rent and utilities.  The PPP provided for forgiveness of the loan if recipient businesses spent the proceeds on these specified expenses within a limited time period and used a certain percentage for payroll costs.

Another source of relief provided by the CARES Act was the EIDLP, which provided low-interest financing to small businesses, renters and homeowners in regions affected by declared disasters.  Under the program, EIDLP recipients were eligible to receive advances of up to $10,000 for small businesses within three days of applying for an EIDL (EIDL Advance).  The amount of an EIDL Advance was determined based on the number of employees working for the applicant.  The EIDL Advance did not have to be repaid.

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

The Defendant:

KONSTANTINOS ZARKADAS
Age:  48
Glen Cove, New York

E.D.N.Y. Docket No. 21-CR-363 (GRB)

CENTRAL ISLIP, NY – Earlier today, at the federal courthouse in Central Islip, New York, Scott Gammon pleaded guilty to conspiracy to commit mail fraud. The over $4 million fraud involved a mass mailing scheme that tricked consumers into paying fees for falsely promised cash prizes. The plea took place before Magistrate Judge Steven I. Locke.

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

“The defendant admitted he deceived elderly and vulnerable victims into believing they had won cash prizes by inducing them to pay bogus ‘fees’ to him and his co-conspirators,” stated United States Attorney Peace. “This Office will continue to protect our seniors and other consumers from harm caused by predatory solicitation schemes.”

“Fraudulent prize notices often trick elderly victims into sending away their money based on false promises of large cash prizes,” said Principal Deputy Assistant Attorney General Boynton. “This guilty plea is the latest example of the Department of Justice continuing to pursue and prosecute the perpetrators of these schemes.”

“Postal Inspectors remind consumers, if you have to pay to win a prize, you’ll lose your money. These are all scams designed to lure consumers into sending their hard-earned money—not for a prize, but to fatten the pockets of a fraudster. Mr. Gammon may have thought he got away with this scheme, but he was sadly mistaken when he was confronted by the full investigative power of law enforcement,” said USPIS Inspector-in-Charge Brubaker.

According to court documents, 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 paid the fee ever received such a prize. Gammon is the third defendant to plead guilty to conspiracy to commit mail fraud in connection with this scheme.

Two other defendants previously pleaded guilty to conspiracy to commit mail fraud for participating in the scheme. Christopher King pleaded guilty on September 15, 2021 and Natasha Khan, pleaded guilty on December 15, 2021.

Each of the three defendants faces a maximum penalty of 20 years in prison.

Assistant United States Attorneys Charles P. Kelly and Madeline O’Connor of the Eastern District of New York, Long Island Criminal Division are prosecuting the case with Trial Attorneys Daniel Zytnick and Timothy Finley of the Civil Division’s Consumer Protection Branch.

The Defendant:

SCOTT GAMMON
Age: 47
Broad Channel, New York

E.D.N.Y. Docket No. 22-085 (DRH)

Defendants Previously Pleaded Guilty:

CHRISTOPHER KING
Age: 36
Oceanside, New York

E.D.N.Y. Docket No. 21-CR-418 (DRH)

NATASHA KHAN
Age: 38
Elmont, New York

E.D.N.Y. Docket No. 21-CR-609 (DRH)

A New York resident pleaded guilty today in the Eastern District of New York to participating in a fraudulent multimillion-dollar mass-mailing scheme that tricked consumers into paying fees for falsely promised cash prizes.

According to court documents, from August 2014 through August 2019, Scott Gammon, 47, of Broad Channel, New York, 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. Gammon is the third defendant to plead guilty to conspiracy to commit mail fraud in connection with this scheme. 

“Fraudulent prize notices often cause victims, including the elderly, to send money based on false promises of large cash prizes,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “This guilty plea is the latest example of the Department of Justice continuing to pursue and prosecute the perpetrators of these schemes.”

“The defendant admitted he deceived elderly and vulnerable victims into believing they had won cash prizes by inducing them to pay bogus ‘fees’ to him and his co-conspirators,” stated U.S. Attorney Breon Peace for the Eastern District of New York. “This office will continue to protect our seniors and other consumers from harm caused by predatory solicitation schemes.”

“Postal Inspectors remind consumers, if you have to pay to win a prize, you’ll lose your money,” said Inspector in Charge Daniel B. Brubaker of the U.S. Postal Inspection Service. “These are all scams designed to lure consumers into sending their hard-earned money — not for a prize, but to fatten the pockets of a fraudster. Mr. Gammon may have thought he got away with this scheme, but he was sadly mistaken when he was confronted by the full investigative power of law enforcement.”

Two other defendants previously pleaded guilty to conspiracy to commit mail fraud for participating in the scheme. Christopher King, 36, of Oceanside, New York, pleaded guilty on Sept. 15, 2021. Natasha Khan, 38, of Elmont, New York, pleaded guilty on Dec. 15, 2021.

Gammon’s plea took place before Magistrate Judge Steven I. Locke. Gammon is scheduled to be sentenced at a later date. Each of the three defendants faces a maximum penalty of 20 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

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

Trial Attorneys Daniel Zytnick and Timothy Finley of the Civil Division’s Consumer Protection Branch and Assistant U.S. Attorney Charles P. Kelly of the U.S. Attorney’s Office for the Eastern District of New York are prosecuting the case.

Additional information about the Consumer Protection Branch and its enforcement efforts may be found at www.justice.gov/civil/consumer-protection-branch.

Two complaints were unsealed and one amended complaint was authorized today in federal court in Brooklyn charging five defendants with various crimes related to efforts by the secret police of the People’s Republic of China (PRC) to stalk, harass, and spy on Chinese nationals residing in Queens, New York and elsewhere in the United States.  All of the defendants allegedly perpetrated transnational repression schemes to target U.S. residents whose political views and actions are disfavored by the PRC government, such as advocating for democracy in the PRC.  In one of these schemes, the coconspirators sought to interfere with federal elections by allegedly orchestrating a campaign to undermine the U.S. congressional candidacy of a U.S. military veteran who was a leader of the 1989 pro-democracy demonstrations in Beijing, PRC.  In another of these schemes, three defendants planned to destroy the artwork of a PRC national residing in Los Angeles, California that was critical of the PRC government, and planted surveillance equipment in the artist’s workplace and car to spy on him from the PRC. 

Fan “Frank” Liu and Matthew Ziburis were arrested yesterday, while Shujun Wang was arrested this morning.  All three arrests occurred in the Eastern District of New York.  The defendants’ initial appearances are scheduled this afternoon in Brooklyn before United States Magistrate Judge James R. Cho.  The other two defendants remain at large. 

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, Alan E. Kohler, Jr., Assistant Director of the Federal Bureau of Investigation’s Counterintelligence Division (FBI), and Michael J. Driscoll, Assistant Director-in-Charge, FBI, New York Field Office, announced the arrests and charges.

“The complaints unsealed today reveal the outrageous and dangerous lengths to which the PRC government’s secret police and these defendants have gone to attack the rule of law and freedom in New York City and elsewhere in the United States,” stated United States Attorney Peace.  “As alleged, all three cases involve campaigns to silence, harass, discredit and spy on U.S. residents for simply exercising their freedom of speech.  The United States will not tolerate blatantly illegal actions that target U.S. residents, on U.S. soil, and undermine our treasured American values and rights.”   

“Transnational repression harms people in the United States and around the world and threatens the rule of law itself,” said Assistant Attorney General Olsen. “This activity is antithetical to fundamental American values, and we will not tolerate it when it violates U.S. law. The Department of Justice will defend the rights of Americans and those who come to live, work, and study in the United States. We will not allow any foreign government to impede their freedom of speech, to deny them the protection of our laws, or to threaten their safety or the safety of their families.”

“The Ministry of State Security is more than an intelligence collection agency. It executes the Chinese government’s efforts to limit free speech, attack dissidents, and preserve the power of the Communist Party,” stated FBI Assistant Director Kohler.  “When it exports those actions overseas, it violates the fundamental sovereignty of the US and becomes a national security threat. These indictments should serve as a stark warning to the MSS and all foreign intelligence agencies that their efforts at repression will not be tolerated within our borders.”

“As alleged, all of the defendants charged today at the direction of the PRC secret police, engaged in a series of actions designed to silence the free speech of Chinese dissidents in the United States.  Transnational repression schemes pose an increasing threat against U.S. residents who choose to speak out against the People’s Republic of China and other regimes.  The FBI is committed to protecting the free speech of all U.S. residents, and we simply will not tolerate the attempts of foreign governments to violate our laws and restrict our freedom,” stated FBI Assistant Director-in-Charge Driscoll.

United States v. Qiming Lin

Lin is charged with conspiracy to commit interstate harassment, as well as conspiracy and attempt to use of a means of identification in connection with the interstate harassment conspiracy.

As alleged, Lin, a citizen and resident of the PRC, works on behalf of the PRC’s Ministry of State Security (MSS).  The MSS is a civilian intelligence and secret police agency responsible for counterintelligence and political security.

Beginning in September 2021, Lin hired a private investigator (the PI) in New York to disrupt the campaign of a Brooklyn resident currently running for U.S. Congress (the Victim), including by physically attacking the Victim.  The Victim was a student leader of the pro­democracy demonstrations in Tiananmen Square in 1989, who later escaped to the United States, served in the U.S. military, and became a naturalized U.S. citizen.  In September 2021, the Victim (then living in Long Island) announced his intention to run for a U.S. congressional seat on Long Island in the November 2022 general election.

In hiring the PI, Lin explained that if the Victim was selected during the June 2022 primary election, then he might be “elected to be a legislator.  Right now we don’t want him to be elected.”  Lin emphasized that “Whatever price is fine.  As long as you can do it.”  He also promised that “we will have a lot more-more of this [work] in the future . . . Including right now [a] New York State legislator.”  Lin explained to the PI that Lin was working with other unidentified individuals in the PRC to stop the Victim from being elected to U.S. Congress.

As alleged, Lin first asked the PI to provide information about the Victim, including the Victim’s address and phone number, which the PI later provided.  Lin also requested that the PI unearth derogatory information about the Victim or, if no such information could be found, “manufacture something, like what happened to [a famous concert pianist (the Pianist)]?”  That request referred to an incident in Beijing in which the Pianist was reportedly detained after allegedly being found in the company of a prostitute.  Lin later reiterated that, if the PI could not uncover a scandal, then “can they create some?”  Lin also encouraged the PI to “go find a girl . . . Or see how he goes for prostitution, take some photos, something of that nature.”

In December 2021, Lin proposed that the PI also consider physically attacking the Victim to prevent his candidacy.  In a voice message to the PI, Lin stated:

You can start thinking now, aside from violence, what other plans are there?  Huh?  But in the end, violence would be fine too.  Huh?  Beat him [chuckles], beat him until he cannot run for election.  Heh, that’s the-the last resort.  You-you think about it.  Car accident, [he] will be completely wrecked [chuckles], right?  Don’t know, eh, whatever ways from all different angles.  Or, on the day of the election, he cannot make it there himself, right?

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

United States v. Shujun Wang

Wang is charged with acting as an agent of the PRC government, criminal use of means of identification, and making materially false statements, in connection with his participation in a transnational repression scheme orchestrated by the MSS.

As alleged, Wang, who lives in Flushing, Queens, is a former visiting scholar and author who helped start a pro-democracy organization in Queens that memorializes two former leaders of the Chinese Communist Party who promoted political and economic reforms within the PRC and were eventually forced from power.  Since at least 2015, however, Wang has secretly operated at the direction and control of several MSS officers. 

At the direction of the MSS, Wang used his position and status within the Chinese diaspora community in New York City to collect information about prominent activists, dissidents, and human rights leaders to report that information to the PRC government.  While ostensibly lending a sympathetic ear, Wang reported on statements activists made in confidence to him, including on their views on democracy in the PRC, as well as planned speeches, writings, and demonstrations against the Chinese Communist Party.  The victims of Wang’s efforts included individuals and groups located in New York City and elsewhere that the PRC considers subversive, such as Hong Kong pro-democracy activists, advocates for Taiwanese independence, and Uyghur and Tibetan activists, both in the United States and abroad.  Wang sent email “diaries” to the MSS that contained details of his conversations with prominent dissidents, the activities of pro-democracy activists, as well as relevant phone numbers and other contact information for the targets of the PRC government.

For example, in a series of communications on November 22, 2016, Wang’s MSS handler instructed him to meet with a particular attendee at a pro-democracy event in Queens and to “accomplish the task” assigned by the “Boss.” The MSS handler emphasized that the attendee had contacts with “Tibetans, Uyghurs and Mongolians.”  Similarly, on November 16, 2016, Wang informed another MSS handler that he “just finished chatting” with a prominent human rights activist and had asked the “necessary questions” and received “candid” answers.  The MSS officer responded “great” and with a thumbs-up emoji, instructing Wang to record that information in a “diary.” 

In April 2020, one victim about whom Wang reported—the Hong Kong democracy activist identified in the complaint as “Hong Kong Dissident #1”—was arrested in Hong Kong and jailed on political charges.  In addition, in April 2019, Wang flew from the PRC to John F. Kennedy International Airport in Queens carrying a handwritten document with the names and non-public contact information for dozens of other well-known PRC dissidents, including other Hong Kong democracy activists who were subsequently arrested by the PRC in 2019 and 2020. 

The complaint also alleges that, during an interview in Queens on August 2, 2017, Wang lied to federal law enforcement, falsely denying that he had contacts with PRC officials or the MSS when in fact he had been secretly reporting on U.S. residents to the MSS.  Wang later admitted much of his criminal conduct to an undercover member of law enforcement and during a subsequent interview with agents.

The government’s case is being handled by the Office’s National Security and Cybercrime Section.  Assistant United States Attorney Artie McConnell 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, and Assistant United States Attorney Edward Chang of the United States Attorney’s Office for the District of Connecticut.

United States v. Fan “Frank” Liu, Matthew Ziburis, and Qiang “Jason” Sun

Liu and Ziburis are charged with conspiring to act as agents of the PRC government.  Liu, Ziburis, and Sun are charged with conspiring to commit interstate harassment and criminal use of a means of identification.  Liu and Sun are charged with conspiring to bribe a federal official in connection with their scheme to obtain the tax returns of a pro-democracy activist residing in the United States. 

According to the complaint, Liu, a resident of Jericho, Long Island, is president of a purported media company based in New York City, while Ziburis, a resident of Oyster Bay, Long Island, is a former correctional officer for the State of Florida and a bodyguard.  Sun is a PRC-based employee of an international technology company. 

According to the complaint, Liu and Ziburis have been operating under Sun’s direction and control to discredit pro-democracy PRC dissidents residing in the United States—including in New York City, California, and Indiana—by spying on them and disseminating negative information about them.  For example, at Sun’s direction, Liu paid a private investigator in Queens to bribe an Internal Revenue Service employee to obtain the federal tax returns of one of the dissidents.  The private investigator was cooperating with law enforcement, and no Internal Revenue Service employee received a bribe payment.  The defendants planned to publicly disclose the dissident’s potential tax liabilities to discredit him.  The coconspirators also made plans to destroy the artwork of a dissident artist whose work is critical of the PRC government, and the artist’s sculpture depicting PRC President Xi Jinping as a coronavirus molecule was demolished in the Spring of 2021.  Sun has paid both Liu and Ziburis for these efforts to stalk, harass, and surveil dissidents residing in the United States. 

As part of their efforts, the defendants electronically spied on the pro-democracy activists.  For example, posing as an art dealer interested in purchasing the artwork of the dissident artist, Ziburis secretly installed surveillance cameras and GPS devices at the dissident’s workplace and in his car.  While in the PRC, Sun watched the live video feed and location data from these devices.  The defendants made similar plans to install surveillance equipment at the residences and on the vehicles of two other dissidents.  Liu and Ziburis planned to gain access to one such residence by posing as a member of an international sports committee. 

The defendants also planned to interview the dissidents in mock media sessions, using the cover of Liu’s purported media organization.  Sun provided outlines for these fake interviews and designed questions to elicit answers that were intended to humiliate or discredit the dissidents.  The defendants intended that audio or video clips of these statements could be used in PRC propaganda materials targeting the dissidents.

The government’s case is being handled by the Office’s National Security and Cybercrime Section.  Assistant United States Attorneys Alexander A. Solomon and Emily J. Dean are in charge of the prosecution, with assistance from Brian D. Morris of the Office’s Asset Forfeiture Section, Trial Attorney Scott A. Claffee of the National Security Division’s Counterintelligence and Export Control Section, and Assistant United States Attorney Christopher D. Grigg of the United States Attorney’s Office for the Central District of California.

*          *          *

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

The FBI has created a website for victims to report efforts by foreign governments to stalk, intimidate, or assault people in the United States.  If you believe that you are or have been a victim of transnational repression, please visit https://www.fbi.gov/investigate/counterintelligence/transnational-repression.

The Defendants:

QIMING LIN
Age: 59
People’s Republic of China

E.D.N.Y. Docket No.  22-MJ-251

SHUJUN WANG
Age: 73
Queens, New York

E.D.N.Y. Docket No.  22-MJ-250

Fan “Frank” Liu
Age:  62
Jericho, New York

E.D.N.Y. Docket No.  22-MJ-257

MATTHEW ZIBURIS
Age:  49
Oyster Bay, New York

E.D.N.Y. Docket No.  22-MJ-257

QIANG “JASON” SUN
Age:  40
PEOPLE’S REPUBLIC OF CHINA

E.D.N.Y. Docket No.  22-MJ-257

Defendants Participated in Transnational Repression Schemes to Silence Critics of the People’s Republic of China (PRC) Residing in the United States and Abroad – Including by Attempting to Disrupt the Campaign of a U.S. Military Veteran and Candidate for U.S. Congress in Brooklyn Who Expressed Views Critical of the PRC and by Scheming to Destroy a PRC Dissident’s Artwork Criticizing the PRC Government

Two complaints were unsealed, and one amended complaint was authorized today in federal court charging five defendants with various crimes related to efforts by the secret police of the People’s Republic of China (PRC) to stalk, harass and spy on Chinese nationals residing in Queens, New York, and elsewhere in the United States.

Fan “Frank” Liu and Matthew Ziburis were arrested yesterday in the Eastern District of New York, while Shujun Wang was arrested this morning in the Eastern District of New York. Their initial appearances are scheduled this afternoon in Brooklyn before U.S. Magistrate Judge James R. Cho. The other two defendants remain at large. 

According to court documents, all the defendants allegedly perpetrated transnational repression schemes to target U.S. residents whose political views and actions are disfavored by the PRC government, such as advocating for democracy in the PRC. In one of these schemes, the co-conspirators sought to interfere with federal elections by allegedly orchestrating a campaign to undermine the U.S. congressional candidacy of a U.S. military veteran who was a leader of the 1989 pro-democracy demonstrations in Beijing, PRC. In another of these schemes, three defendants planned to destroy the artwork of a PRC national residing in Los Angeles that was critical of the PRC government, and planted surveillance equipment in the artist’s workplace and car to spy on him from the PRC.

“Transnational repression harms people in the United States and around the world and threatens the rule of law itself,” said Assistant Attorney General Matthew G. Olsen of the Justice Department’s National Security Division. “This activity is antithetical to fundamental American values, and we will not tolerate it when it violates U.S. law. The Department of Justice will defend the rights of Americans and those who come to live, work, and study in the United States. We will not allow any foreign government to impede their freedom of speech, to deny them the protection of our laws or to threaten their safety or the safety of their families.”

“The complaints unsealed today reveal the outrageous and dangerous lengths to which the PRC government’s secret police and these defendants have gone to attack the rule of law and freedom in New York City and elsewhere in the United States,” stated U.S. Attorney Breon Peace for the Eastern District of New York. “As alleged, all three cases involve campaigns to silence, harass, discredit and spy on U.S. residents for simply exercising their freedom of speech. The United States will not tolerate blatantly illegal actions that target U.S. residents, on U.S. soil, and undermine our treasured American values and rights.”   

“As alleged, all of the defendants charged today at the direction of the PRC secret police, engaged in a series of actions designed to silence the free speech of Chinese dissidents in the United States,” said Assistant Director-in-Charge Michael J. Driscoll of the FBI’s New York Field Office. “Transnational repression schemes pose an increasing threat against U.S. residents who choose to speak out against the People’s Republic of China and other regimes. The FBI is committed to protecting the free speech of all U.S. residents, and we simply will not tolerate the attempts of foreign governments to violate our laws and restrict our freedom.”

“The Ministry of State Security is more than an intelligence collection agency. It executes the Chinese government’s efforts to limit free speech, attack dissidents, and preserve the power of the Communist Party,” said Assistant Director Alan E. Kohler Jr. of the FBI’s Counterintelligence Division. “When it exports those actions overseas, it violates the fundamental sovereignty of the United States and becomes a national security threat. These indictments should serve as a stark warning to the MSS and all foreign intelligence agencies that their efforts at repression will not be tolerated within our borders.”

United States v. Qiming Lin

Qiming Lin, 59, of the PRC, is charged with conspiracy to commit interstate harassment, as well as conspiracy and attempt to use of a means of identification in connection with the interstate harassment conspiracy.

As alleged, Lin works on behalf of the PRC’s Ministry of State Security (MSS). The MSS is a civilian intelligence and secret police agency responsible for counterintelligence and political security.

Beginning in September 2021, Lin hired a private investigator (the PI) in New York to disrupt the campaign of a Brooklyn resident currently running for U.S. Congress (the Victim), including by physically attacking the Victim. The Victim was a student leader of the pro-democracy demonstrations in Tiananmen Square in 1989, who later escaped to the United States, served in the U.S. military, and became a naturalized U.S. citizen. In September 2021, the Victim (then living in Long Island) announced his intention to run for a U.S. congressional seat on Long Island in the November 2022 general election.

In hiring the PI, Lin explained that if the Victim was selected during the June 2022 primary election, then he might be “elected to be a legislator. Right now we don’t want him to be elected.” Lin emphasized that, “Whatever price is fine. As long as you can do it.”  He also promised that “we will have a lot more-more of this [work] in the future…Including right now [a] New York State legislator.” Lin explained to the PI that Lin was working with other unidentified individuals in the PRC to stop the Victim from being elected to U.S. Congress.

As alleged, Lin first asked the PI to provide information about the Victim, including the Victim’s address and phone number, which the PI later provided. Lin also requested that the PI unearth derogatory information about the Victim or, if no such information could be found, “manufacture something, like what happened to [a famous concert pianist (the Pianist)]?” That request referred to an incident in Beijing in which the Pianist was reportedly detained after allegedly being found in the company of a prostitute. Lin later reiterated that, if the PI could not uncover a scandal, then “can they create some?” Lin also encouraged the PI to “go find a girl… Or see how he goes for prostitution, take some photos, something of that nature.”

In December 2021, Lin proposed that the PI also consider physically attacking the Victim to prevent his candidacy. In a voice message to the PI, Lin stated:

You can start thinking now, aside from violence, what other plans are there? Huh? But in the end, violence would be fine too. Huh? Beat him [chuckles], beat him until he cannot run for election. Heh, that’s the-the last resort. You-you think about it. Car accident, [he] will be completely wrecked [chuckles], right? Don’t know, eh, whatever ways from all different angles. Or, on the day of the election, he cannot make it there himself, right?

If convicted, Lin faces a statutory maximum penalty of 10 years in prison. Lin remains at large.

Assistant U.S. Attorneys Alexander A. Solomon and David K. Kessler for the Eastern District of New York are prosecuting the case, with assistance from Trial Attorney Scott A. Claffee of the National Security Division’s Counterintelligence and Export Control Section.

United States v. Shujun Wang

Shujun Wang, 73, of Queens, New York, is charged with acting as an agent of the PRC government, criminal use of means of identification and making materially false statements in connection with his participation in a transnational repression scheme orchestrated by the MSS.

As alleged, Wang is a former visiting scholar and author who helped start a pro-democracy organization in Queens that memorializes two former leaders of the Chinese Communist Party who promoted political and economic reforms within the PRC and were eventually forced from power. Since at least 2015, however, Wang has secretly operated at the direction and control of several MSS officers.

At the direction of the MSS, Wang used his position and status within Chinese diaspora community in New York City to collect information about prominent activists, dissidents, and human rights leaders to report that information to the PRC government. While ostensibly lending a sympathetic ear, Wang reported on statements activists made in confidence to him, including on their views on democracy in the PRC, as well as planned speeches, writings, and demonstrations against the Chinese Communist Party. The victims of Wang’s efforts included individuals and groups located in New York City and elsewhere that the PRC considers subversive, such as Hong Kong pro-democracy activists, advocates for Taiwanese independence, and Uyghur and Tibetan activists, both in the United States and abroad. Wang sent email “diaries” to the MSS that contained details of his conversations with prominent dissidents, the activities of pro-democracy activists, as well as relevant phone numbers and other contact information for the targets of the PRC government.

For example, in a series of communications on Nov. 22, 2016, Wang’s MSS handler instructed him to meet with a particular attendee at a pro-democracy event in Queens and to “accomplish the task” assigned by the “Boss.” The MSS handler emphasized that the attendee had contacts with “Tibetans, Uyghurs and Mongolians.”  Similarly, on Nov. 16, 2016, Wang informed another MSS handler that he “just finished chatting” with a prominent human rights activist and had asked the “necessary questions” and received “candid” answers. The MSS officer responded “great” and with a thumbs-up emoji, instructing Wang to record that information in a “diary.” 

In April 2020, one victim about whom Wang reported – the Hong Kong democracy activist identified in the complaint as Hong Kong Dissident #1 – was arrested in Hong Kong and jailed on political charges. In addition, in April 2019, Wang flew from the PRC to Queens carrying a handwritten document with the names and non-public contact information for dozens of other well-known PRC dissidents, including other Hong Kong democracy activists who were subsequently arrested by the PRC in 2019 and 2020.

The complaint also alleges that, during an interview in Queens on Aug. 2, 2017, Wang lied to federal law enforcement, falsely denying that he had contacts with PRC officials or the MSS when in fact he had been secretly reporting on U.S. residents to the MSS. Wang later admitted much of his criminal conduct to an undercover member of law enforcement and during a subsequent interview with agents.

Wang was arrested this morning in the Eastern District of New York and is scheduled to make his initial appearance this afternoon before U.S. Magistrate Judge James R. Cho. If convicted, Wang faces a statutory maximum penalty of 20 years in prison.

Assistant U.S. Attorney Artie McConnell for the Eastern District of New York is prosecuting the case, with assistance from Trial Attorney Scott A. Claffee of the National Security Division’s Counterintelligence and Export Control Section.

United States v. Fan “Frank” Liu, Matthew Ziburis, and Qiang “Jason” Sun

Fan “Frank” Liu, 62, of Long Island, New York, and Matthew Ziburis, 49, of Oyster Bay New York, are charged with conspiring to act as agents of the PRC government. Liu, Ziburis and co-defendant Quiang “Jason” Sun, 40, of the PRC, are charged with conspiring to commit interstate harassment and criminal use of a means of identification. Liu and Sun are charged with conspiring to bribe a federal official in connection with their scheme to obtain the tax returns of a pro-democracy activist residing in the United States.

According to the complaint, Liu is president of a purported media company based in New York City, while Ziburis is a former correctional officer for the State of Florida and a bodyguard. Sun is a PRC-based employee of an international technology company.

According to the complaint, Liu and Ziburis have been operating under Sun’s direction and control to discredit pro-democracy PRC dissidents residing in the United States – including in New York City, California and Indiana – by spying on them and disseminating negative information about them. For example, at Sun’s direction, Liu paid a private investigator in Queens to bribe an IRS employee to obtain the federal tax returns of one of the dissidents. The private investigator was cooperating with law enforcement, and no Internal Revenue Service employee received a bribe payment. The defendants planned to publicly disclose the dissident’s potential tax liabilities to discredit him. The co-conspirators also made plans to destroy the artwork of a dissident artist whose work is critical of the PRC government, and the artist’s sculpture depicting PRC President Xi Jinping as a coronavirus molecule was demolished in the Spring 2021. Sun has paid both Liu and Ziburis for these efforts to stalk, harass and surveil dissidents residing in the United States.

As part of their efforts, the defendants electronically allegedly spied on the pro-democracy activists. For example, posing as an art dealer interested in purchasing the artwork of the dissident artist, Ziburis secretly installed surveillance cameras and GPS devices at a dissident’s workplace and in his car. While in the PRC, Sun watched the live video feed and location data from these devices. The defendants made similar plans to install surveillance equipment at the residences and on the vehicles of two other dissidents. Liu and Ziburis planned to gain access to one such residence by posing as a member of an international sports committee.

The defendants also planned to interview the dissidents in mock media sessions, using the cover of Liu’s purported media organizations. Sun provided outlines for these fake interviews and designed questions to elicit answers that were intended to humiliate or discredit the dissidents. The defendants intended that audio or video clips of these statements could be used in PRC propaganda materials targeting the dissidents.

Liu and Ziburis were arrested yesterday in the Eastern District of New York and are scheduled to make their initial appearances this afternoon in Brooklyn before U.S. Magistrate Judge James R. Cho. Sun remains at large.

If convicted, Liu and Ziburis face a maximum statutory penalty of five years in prison for conspiring to commit interstate harassment, and up to 15 years in prison for criminal use of a means of identification. Liu and Sun face up to five years each for conspiring to bribe a federal official. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Assistant U.S. Attorneys Alexander A. Solomon and Emily J. Dean for the Eastern District of New York are prosecuting the case, with assistance from Assistant U.S. Attorney Brian D. Morris of the Office’s Asset Forfeiture Section and Trial Attorney Scott A. Claffee of the National Security Division’s Counterintelligence and Export Control Section.

The FBI is investigating these cases.

If you are in the United States, including a U.S. territory, your freedom of speech is protected, regardless of your citizenship. To report threats or intimidation by a foreign government, contact the FBI online at tips.fbi.gov or call 1-800-CALL-FBI (1-800-225-5324). For more information on transnational repression investigations, visit Transnational Repression | FBI.

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

Dzenan Camovic pleaded guilty yesterday in federal court in Brooklyn to robbing a New York City Police Department (NYPD) officer’s firearm and discharging the firearm at NYPD officers during the course of the robbery. The offenses took place on June 3, 2020, when Camovic attacked multiple police officers on patrol in Brooklyn. The proceeding was held before United States District Judge Rachel P. Kovner on March 15, 2022.

When sentenced, Camovic faces 30 years’ imprisonment pursuant to the terms of his plea agreement with the government. Camovic has stipulated that the terrorism enhancement to the United States Sentencing Guidelines—an enhanced sentence for certain criminal conduct that was calculated to influence or affect the conduct of government by intimidation or coercion—is applicable to his offense. As part of his plea agreement, Camovic, a Bosnian citizen illegally in the United States, agreed to the entry of an order of removal so that he will be deported after completing his sentence. Camovic also pleaded guilty today in State Supreme Court in Brooklyn to charges arising out of the same conduct.

Breon Peace, United States Attorney for the Eastern District of New York, Michael J. Driscoll, Assistant Director-in-Charge, FBI, New York Field Office and Keechant Sewell, Commissioner, NYPD, announced the guilty plea.

“With this guilty plea, Camovic admitted robbing a police officer’s gun and shooting that gun during an extremely violent attack on officers keeping the city safe during a public emergency,” stated United States Attorney Peace.  “Inspired by terrorists, the defendant viciously attacked officers, stabbing one officer in the neck and shooting another in the hand. Protecting our community from terrorist attacks will always be a priority of this Office, and we will bring to justice those who commit such reprehensible acts against the community and against our law enforcement partners.”

Mr. Peace expressed his appreciation to the FBI’s New York Joint Terrorism Task Force for its outstanding work on the case and the Kings County District Attorney’s Office for their assistance.

“When Mr. Camovic ambushed and feloniously assaulted several heroic NYPD officers, it was also an attack on our city and our collective sense of security.  Yesterday’s plea ensures Mr. Camovic will never again be in a position to commit such a heinous act on our soil.  His case should serve as an example of the FBI’s unwavering commitment to protecting our communities against extremists, while standing shoulder-to-shoulder with our law enforcement partners,” stated FBI Assistant Director-in-Charge Driscoll. 

“An attack on police officers who are sworn to protect the public is an attack on all of us,” stated NYPD Commissioner Sewell, “and our society will never tolerate such destructive violence. This prosecution affirms our joint commitment to confront, combat, and defeat violent extremism in all its forms, anywhere. I commend the NYPD detectives, FBI agents, and representatives of the more than 50 agencies that make up the New York Joint Terrorism Task Force for their investigation leading to today’s guilty plea.”

As set forth in court filings and during the plea proceeding, on the evening of June 3, 2020, in the midst of a public health emergency and while New York City was under a nightly curfew order due to civil unrest, Camovic attacked several uniformed NYPD officers assigned to an anti-looting post near the intersection of Flatbush and Church Avenues in Brooklyn. At approximately 11:30 p.m., Camovic walked past two police officers on foot patrol and appeared to crouch for several minutes watching them. Camovic then moved around the block in an apparent effort to approach the two police officers from behind. 

At approximately 11:50 p.m., Camovic rounded the corner from Flatbush Avenue onto Church Avenue and stabbed one of the officers (“Officer 1”) in the neck with a knife. After stabbing Officer 1, Camovic chased the second officer (“Officer 2”), lunging at him and attempting to stab him. Camovic then ran back to Officer 1, attacked him, forcibly took control of Officer 1’s firearm and fired multiple shots at Officer 2 and other officers who responded to the scene. Responding officers ultimately shot Camovic and took him into custody. Several officers suffered injuries during Camovic’s attack and robbery, including Officer 1, who was stabbed in the neck, and Officer 2, who was shot in the hand.

During his attack on the police officers, Camovic repeatedly shouted “Allahu Akbar,” an Arabic phrase meaning “God is the greatest,” that has been used by perpetrators of violent jihadist terror attacks during the commission of violent attacks. Prior to the attack, Camovic possessed a significant volume of radical jihadist propaganda. 

The government’s case is being handled by the Office’s National Security and Cybercrime Section. Assistant United States Attorneys Craig R. Heeren, Artie McConnell and Josh Hafetz are in charge of the prosecution.

The Defendant:

DZENAN CAMOVIC
Age: 22
Brooklyn, New York

E.D.N.Y. Docket No. 20-CR-326 (RPK)

A superseding indictment was filed today in federal court in Brooklyn charging John Pena, also known as “Tragedy,” “Don Tragg,” “Last Don” and “Money Baggz,” with murder in-aid-of-racketeering for the March 10, 2021 murder of Mark Bajandas on Staten Island.  The superseding indictment also charges Pena with causing death through use of a firearm, being a felon in possession of ammunition, and conspiring to distribute and possess with intent to distribute marijuana and crack cocaine. Pena was previously arrested in June 2021 on an indictment charging him with being a felon in possession of ammunition related to Bajandas’s murder and he was ordered detained in federal custody pending trial.  Pena will be arraigned at a later date.

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 Keechant L. Sewell, Commissioner, New York City Police Department (NYPD), announced the charges.

“As alleged, the defendant, a leader of a violent street gang, unleashed a barrage of gunfire on a public street, killing the victim and placing our community in grave danger,” stated United States Attorney Peace.  “This Office, working closely with our federal and local law enforcement partners, is relentlessly pursuing gang members who terrorize our neighborhoods with senseless acts of gun violence, and we will not rest until this threat is neutralized.” 

Mr. Peace expressed his appreciation to the Richmond County District Attorney’s Office for its assistance on the investigation.

“As alleged, Pena murdered a perceived rival, who sustained 18 gunshot wounds in the attack,” stated FBI Assistant Director-in-Charge Driscoll.  “His apparent lack of respect for the sanctity of human life will now be met with appropriate consequences imposed by the federal criminal justice system.  Along with our NYPD partners, we will continue to be relentless in addressing the scourge of gang and gun violence that plagues our city.”

“The elimination of violent streets gangs is an absolute precondition to the sustainable prosperity and justice that New Yorkers deserve,” stated NYPD Commissioner Sewell. “Everyone has a right to live in peace and safety. But gang activity – particularly the carrying and indiscriminate shooting of illegal guns on our streets – injects fear into the daily lives of people in our communities. The NYPD, in close partnership with the FBI and the U.S. Attorney for the Eastern District, will continue to use every tool at our disposal to identify, arrest, and hold accountable these criminals.”

As alleged in the superseding indictment, the Gorilla Stone Mafia (or “GSM”) is a subgroup of the Untouchable Gorilla Stone Nation, which is a faction of the nationwide Bloods street gang comprised primarily of individuals residing in and around the Stapleton neighborhood of Staten Island.  Members of GSM use intimidation, threats of violence and acts of violence, including murder, robbery and assault, to preserve and protect GSM’s power, territory, and criminal ventures, and to expand the GSM’s criminal operations.  They use drug trafficking, gun trafficking, robbery, fraud and trafficking in stolen identities as means of obtaining money.

According to court filings, Pena was the leader of the Gorilla Stone Mafia.  In the early morning hours of March 10, 2021, Pena fired multiple gunshots from close range at Bajandas, a former GSM associate and perceived rival, killing him.  Bajandas suffered at least 18 gunshot wounds to his upper torso and extremities.  The murder occurred after Pena and Bajandas had attended a memorial earlier in the evening to commemorate the death of Avanti Brock, a former GSM member who was murdered approximately one year earlier. 

If convicted, Pena faces a mandatory sentence of life in prison.

The charges in the superseding indictment are allegations 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.  As part of the program, U.S. Attorney’s 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 Saritha Komatireddy, Matthew R. Galeotti, Tara B. McGrath, and Garen Marshall are in charge of the prosecution.

The Defendant:

JOHN PENA
Age: 31
Staten Island, New York

E.D.N.Y. Docket No. 21-CR-176 (S-1) (AMD)

A 10-count superseding indictment was unsealed today in federal court in Brooklyn charging Robert Rodriguez with Hobbs Act robbery, Hobbs Act robbery conspiracy, and related firearms crimes for planning and executing four armed robberies targeting the owner and patrons of a Queens check-cashing business in July 2020 and September 2021. Rodriguez was arrested today and is scheduled to be arraigned this afternoon before United States Magistrate Judge Taryn A. Merkl. Rodriguez’s co-defendant, Raymundo Heyaime Sanchez, was previously arrested and indicted for Hobbs Act robbery and related crimes for his role in one of the four robberies charged in the superseding indictment. Sanchez is currently detained pending trial.

Breon Peace, United States Attorney for the Eastern District of New York, John B. DeVito, Special Agent-in-Charge, Bureau of Alcohol, Tobacco, Firearms and Explosives, New York Field Division (ATF), and Keechant L. Sewell, Commissioner, New York City Police Department (NYPD), announced the charges.

“As alleged in the superseding indictment, the defendant is charged with the brazen gunpoint robberies of the owner and customers of a Queens check cashing business,” stated United States Attorney Peace. “Such openly menacing and violent conduct will not be tolerated. This Office will vigorously prosecute criminals who allegedly commit violent crimes using guns and endanger the safety and security of our communities.”

“Today’s arrest of an armed violent criminal by the ATF/NYPD Sparta Task Force is another example of our unwavering commitment to aggressively pursue and investigate acts of violence involving the use of firearms in our communities” stated ATF Special Agent-in- Charge DeVito. “The defendant’s willful disregard for the safety and security of our citizens was evident by preying on both the business and customers alike. Thanks to our partners in the United States Attorney’s Office and the NYPD, this defendant will now have to answer for his violent actions in a court of law.”

“Today’s indictment is another example of our laser-like focus on combating violent crime and holding accountable anyone who endangers people on our streets,” stated NYPD Commissioner Sewell. “If you carry an illegal gun in New York City – and especially if you use that gun to terrorize our communities – you will be arrested and charged accordingly. Thanks to the combined efforts of the NYPD and our partners at the ATF and the office of the U.S. Attorney for the Eastern District of New York, the accused in this case now faces the prospect of significant federal prison time.”

As set forth in court filings, Rodriguez, Sanchez, and a co-conspirator targeted the owner of a check-cashing business located in Jamaica, New York. On July 3, 2020, after conducting surveillance of the owner’s home and business, the owner was confronted in the driveway of the business by masked bandits who pistol-whipped him on the back of the head before robbing him of more than $1 million. Rodriguez subsequently committed three additional robberies of the business’s customers more than a year later. On each occasion, Rodriguez purportedly waited in a vehicle near the check-cashing business until a customer departed, at which point he followed each victim by car before ultimately robbing the customer at gunpoint.

The charges in the indictment are allegations, and the defendants are presumed innocent unless and until proven guilty. If convicted of the charges, the defendants face a mandatory minimum of 84 months’ imprisonment and up to life in prison.

The government’s case is being prosecuted by Assistant United States Attorneys Lindsey R. Oken and Adam Toporovsky.

The Defendants:

ROBERT RODRIGUEZ (also known as “Chicho”)
Age: 37
Brooklyn, New York

RAYMUNDO HEYAIME SANCHEZ
Age: 25
Brooklyn, New York

E.D.N.Y. Docket No. 21-CR-465 (S-1)(PKC)

Earlier today, in federal court in Central Islip, Ibrahim Aksakal was sentenced by United States District Judge Joanna Seybert to 27 months’ imprisonment for conspiring to commit health care and wire fraud in connection with a so-called “birth tourism” scheme that Aksakal operated in Suffolk County between approximately 2017 and 2020.  The scheme facilitated pregnant Turkish women fraudulently entering the United States using tourist and business visas to give birth so that their children would obtain birthright citizenship and medical benefits.  The Court also ordered Aksakal to pay restitution in the amount of $1,039,723.63, and forfeiture in the amount of $397,500.

Breon Peace, United States Attorney for the Eastern District of New York; Raymond A. Tierney, District Attorney for Suffolk County; Ricky J. Patel, Acting Special Agent-in-Charge, Homeland Security Investigations, New York (HSI); Scott J. Lampert, Special Agent-in-Charge, U.S. Department of Health and Human Services, Office of Inspector General, New York Region (HHS-OIG); Frank T. Walsh, Jr., Acting Medicaid Inspector General, New York State Office of the Medicaid Inspector General (OMIG); and Rodney K. Harrison, Commissioner, Suffolk County Police Department (SCPD), announced the sentence.

From at least January 2017 to September 2020, Aksakal and his co-conspirators advertised a birth tourism scheme on two Turkish-language Facebook pages.  The approximate $7,500 fee charged to each pregnant woman would include transportation, “insurance” to cover the costs of pre-natal, delivery, and post-natal medical care.  Aksakal and his co-conspirators also instructed the women to conceal their pregnancies. 

The pregnant women stayed in one of seven “birth houses” that Aksakal maintained in Center Moriches, Dix Hills, East Northport, East Patchogue, Smithtown and West Babylon, New York.  As a result of the scheme, Medicaid disbursed more than $1 million in fraudulently obtained benefits.

The government’s case is being handled by the Office’s Long Island Criminal Division.  Assistant United States Attorneys Bradley T. King, Oren Gleich, and Special Assistant United States Attorney Jennifer Sacks are in charge of the prosecution.

The Defendant:

IBRAHIM AKSAKAL (also known as “Dennis”)
Age: 50
East Patchogue, New York

E.D.N.Y. Docket No. 20-CR-400 (JS)

An 11-count indictment was unsealed today in federal court in Brooklyn charging Dwayne Golden, Gregory Aggesen, and Marquis Demacking Egerton, the owners and operators of the web-based virtual currency companies EmpowerCoin, ECoinPlus and Jet-Coin, with conspiracy to commit wire fraud and money laundering, and related substantive counts, in connection with a sophisticated scheme to steal assets from investors.  Golden, Aggesen and William White were also charged with conspiracy to obstruct justice, obstructing justice and tampering with evidence.  The defendants were arrested this morning and will be arraigned in the Eastern District of New York at a later date.

 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 arrests and charges.

“As alleged, the defendants engaged in a sophisticated scheme that preyed on unsuspecting investors nationwide with false promises of guaranteed returns and virtual currency trading opportunities.  When the companies collapsed and their criminal conduct was about to be exposed, the defendants attempted to cover their tracks and destroy evidence,” stated United States Attorney Peace.  “The scams may have been online and virtual, but these charges are very real. This Office is committed to protecting the public from criminals who view cryptocurrency as a new frontier to perpetrate old fashioned crimes of fraud and money laundering.” 

Mr. Peace also thanked the Commodity Futures Trading Commission for their assistance in this matter.

“Whether we’re dealing with virtual currency or cold-hard cash, schemers continue to capitalize on investors’ best intentions and pocket their ill-gotten gains,” stated FBI Assistant Director-in-Charge Driscoll.  “As alleged, those charged today defrauded their victims and generated more that $40 million for their own benefit. This office remains committed to rooting out fraud in all its forms.” 

According to the indictment, between April 2017 and August 2017, Golden, Aggesen, and Egerton, together with others, operated a series of web-based virtual currency companies known as EmpowerCoin, ECoinPlus and Jet-Coin.  The websites for EmpowerCoin, ECoinPlus and Jet-Coin fraudulently promised investors and potential investors guaranteed fix returns on virtual currency investments.  They falsely promised investors and potential investors that these returns were made possible through overseas virtual currency trading operations.  Investors and potential investors were encouraged to invest in the companies with either cash or Bitcoin.  In reality, the assets were used to repay other investors or simply stolen, including by Golden, Aggesen and Egerton.  Golden maintained exclusive access to the Bitcoin and often siphoned Bitcoin funds off the top before paying any investors.  The companies collapsed shortly after receiving the investors’ assets, without having engaged in trading activity.  In total, EmpowerCoin, ECoinPlus and Jet-Coin received more than $40 million from investors. 

The indictment further alleges that, from July 2017 to the present, Golden, Aggesen and White conspired to obstruct a Federal Trade Commission (“FTC”) investigation and a federal criminal grand jury investigation into the fraudulent schemes.  Golden, Aggesen and White allegedly destroyed evidence, and White, on Aggesen’s behalf, provided false and misleading information to the FTC and in response to a federal grand jury subpoena. 

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 20 years in prison.

If you were an EmpowerCoin.com, ECoinPlus.com and/or Jet-Coin.com customer and would like to file a complaint, please visit www.iC3.gov.  Please reference “EmpowerCoin,” “ECoinPlus” or “Jet-Coin” in your complaint. 

The government’s case is being handled by the Office’s Business and Securities Fraud Section.  Assistant United States Attorneys Alixandra E. Smith, Catherine M. Mirabile and Nick M. Axelrod are in charge of the prosecution, with the assistance of Assistant United States Attorney Claire Kedeshian of the Office’s Asset Recovery Section who is handling forfeiture matters.

The Defendants:

DWAYNE GOLDEN
Age: 57
Harrisburg, Pennsylvania

GREGORY AGGESEN
Age: 58
Stanfordville, New York

MARQUIS DEMACKING EGERTON (also known as “Mardy Eger”)
Age: 58
Washington, North Carolina

WILLIAM WHITE
Age: 54
Harrisburg, Pennsylvania

E.D.N.Y. Docket No. 21-CR-88 (MKB)

BROOKLYN, NY – Comprehensive Health Services, LLC (CHS), located in Florida, has agreed to pay $930,000 to resolve allegations that it violated the False Claims Act by falsely representing to the State Department and the Air Force that it complied with contract requirements relating to the provision of medical services at State Department and Air Force facilities in Iraq and Afghanistan.  This is the Department of Justice’s first resolution of a False Claims Act case involving cyber fraud since the launch of the Department’s Civil Cyber-Fraud Initiative, which aims to combine the Department’s expertise in civil fraud enforcement, government procurement, and cybersecurity to combat new and emerging cyber threats to the security of sensitive information and critical systems 

Breon Peace, United States Attorney for the Eastern District of New York; Brian M. Boynton, Principal Deputy Attorney General of the Justice Department’s Civil Division; Roger B. Handberg, United States Attorney for the Middle District of Florida; Elisabeth “Elli” Kaminsky, Special Agent-in-Charge, United States Department of State, Office of Investigations; and Nicholas J. Groesbeck, Special Agent-in-Charge, Air Force Office of Special Investigations, Procurement Fraud Detachment 4, Wright-Patterson AFB, Ohio (OSI), announced the settlement.

CHS is a provider of global medical services that contracted to provide medical support services at government-run facilities in Iraq and Afghanistan. Under one of the contracts, CHS submitted claims to the State Department for the cost of a secure electronic medical record (EMR) system to store all patients’ medical records, including the confidential identifying information of United States service members, diplomats, officials, and contractors working and receiving medical care in Iraq. The United States alleged that, between 2012 and 2019, CHS failed to disclose to the State Department that it had not consistently stored patients’ medical records on a secure EMR system. When CHS staff scanned medical records for the EMR system, CHS staff saved and left scanned copies of some records on an internal network drive, which was accessible to non-clinical staff. Even after staff raised concerns about the privacy of protected medical information, CHS did not take adequate steps to store the information exclusively on the EMR system.

The State Department and Air Force contracts also required CHS to provide medical supplies, including controlled substances, that were approved by the U.S. Food and Drug Administration (FDA) or European Medicines Agency (EMA) and manufactured in accordance with federal quality standards. The United States alleged that, between 2012 and 2019, CHS falsely represented to the State Department and Air Force that certain substances provided under those contracts were approved by the FDA or EMA. CHS lacked a Drug Enforcement Agency license necessary for exporting controlled substances from the United States to Iraq. CHS obtained controlled substances by having CHS physicians based in Florida send letters requesting that a South African physician prescribe the controlled substances. A South African shipping company then received controlled substances that were not approved by the FDA or EMA and sent them to CHS in Iraq, where CHS supplied the unapproved controlled substances to patients under the State Department and Air Force contracts.

“Protecting the health and safety of servicemembers, diplomats, and other government employees working abroad is of utmost importance.  The defendants were required to maintain personal health information securely and provide only approved pharmaceuticals to patients.  This settlement serves notice to federal contractors that they will be held accountable for conduct that puts private medical records and patient safety at risk,” stated United States Attorney Breon Peace for the Eastern District of New York.  “We are grateful for the support of our colleagues in the Middle District of Florida, the State Department, and the Air Force for their assistance in investigating these important claims.”

“This settlement demonstrates the department’s commitment to use its civil enforcement tools to pursue government contractors that fail to follow required cybersecurity standards, particularly when they put confidential medical records at risk,” stated Principal Deputy Assistant Attorney General Brian M. Boynton of the Justice Department’s Civil Division.  “We will continue to ensure that those who do business with the government comply with their contractual obligations, including those requiring the protection of sensitive government information.”

“Government contractors should never disregard their obligations when providing medical care to members of the military,” stated United States Attorney Roger B. Handberg for the Middle District of Florida.  “We thank our colleagues in the Eastern District of New York, as well as the investigative agencies who supported this effort, for their steadfast pursuit of this important investigation.”

“This settlement demonstrates the commitment State Department, Office of Inspector General, Special Agents have to protect the safety, well-being, and personal information of State Department personnel.  Our hope is that this outcome will send a clear message that cutting corners on State Department contracts has significant consequences.” stated Special Agent in Charge Elisabeth “Elli” Kaminsky of the U.S. Department of State OIG, Office of Investigations. 

“The Department of the Air Force Office of Special Investigations (OSI) is undeterred in its approach to hunting down fraud within our Foreign Military Sales programs and ensuring the offenders are held accountable,” stated Air Force OSI Special Agent-in-Charge Groesbeck.  “We applaud the complainant for coming forward, which allowed our joint partners to protect the governments procurement process and carry out the warfighting mission.” 

The civil settlement includes the resolution of two actions brought under the qui tam or whistleblower provisions of the False Claims Act against CHS. Under the qui tam provisions of the False Claims Act, a private party can file an action on behalf of the United States and receive a portion of the settlement if the government takes over the case and reaches a monetary agreement with the defendant. The qui tam cases are captioned United States ex rel. Lawler v. Comprehensive Health Servs., Inc. et al., Case No. 20-cv-698 (E.D.N.Y.) and United States ex rel. Watkins et al. v. CHS Middle East, LLC, Case No. 17-cv-4319 (E.D.N.Y.).

The investigation and resolution of this matter demonstrates the government’s emphasis on combatting cyber-fraud.  On October 6, 2021, the Deputy Attorney General announced the Department’s Civil Cyber-Fraud Initiative, which aims to hold accountable entities or individuals that put U.S information or systems at risk by knowingly providing deficient cybersecurity products or services, knowingly misrepresenting their cybersecurity practices or protocols, or knowingly violating obligations to monitor and report cybersecurity incidents and breaches. Information on how to report cyber fraud can be found here.

The resolutions obtained in this matter were the result of a coordinated effort between the United States Attorney’s Office for the Eastern District of New York, the Fraud Section of the Commercial Litigation Branch of the Justice Department’s Civil Division, the U.S. Attorney’s Office for the Middle District of Florida, the United States Department of State Office of Inspector General, and the United States Air Force.

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

The government’s case was handled by Assistant U.S. Attorney Christopher Volpe and former Assistant U.S. Attorney Lisa Kutlin of the Eastern District of New York, and Assistant U.S. Attorney Jeremy Bloor of the Middle District of Florida. 

Earlier today, in federal court in Central Islip, Morris Barnard, a medical doctor practicing in Great Neck, New York, pleaded guilty to health care fraud in connection with billing Medicare for millions of dollars for medical procedures that were never actually performed.  The proceeding was held before United States Magistrate Judge Anne Y. Shields. 

Breon Peace, United States Attorney for the Eastern District of New York, Scott Lampert, Special Agent-in-Charge, Health & Human Services and Michael Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI) announced the guilty plea.

“With today’s guilty plea, Dr. Barnard admits to committing a multi-million dollar fraud on the Medicare program by billing for procedures he did not perform,” stated United States Attorney Peace.   “By claiming to render services to disabled and other vulnerable patients, Dr. Barnard not only pocketed taxpayer funds that were intended to help beneficiaries in need, he also betrayed his oath for profit.  We will continue to work closely with our law enforcement partners to protect the integrity of taxpayer-funded health care programs.” 

“Money that’s allocated for Medicare-approved services, and fraudulently paid out to providers who don’t actually perform these services, is a crime that’s ultimately paid for by taxpayers themselves. Our office is committed to rooting out this type of fraudulent activity and maintaining the integrity of our government-sponsored health care programs,” stated FBI Assistant Director-in Charge Driscoll.

“The defendant’s actions diverted scarce taxpayer funds from the Medicare program for personal enrichment, while taking advantage of vulnerable individuals,” stated HHS-OIG Special Agent-in-Charge Lampert.  “Working with our law enforcement partners, HHS-OIG will continue to ensure that providers that bill federally funded health care programs do so in an honest manner, and criminals will be held accountable.”

From October 2015 through February 2020, Dr. Barnard submitted over $3 million in billings to Medicare for colonoscopy and gastroenterological procedures that were not done.  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 Dr. Barnard was entitled to receive.

The government’s case is being prosecuted by Assistant United States Attorneys Erin Argo, Charles P. Kelly and Madeline O’Connor of the Long Island Criminal Division.

The Defendant:

MORRIS BARNARD
Age:  58
Great Neck, New York

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

UPDATE

The Complaint described in the press release below was dismissed by the Court on March 18, 2025, pursuant to a stipulation of voluntary dismissal entered into by the parties.  See No. 22-CV-1159 (ENV), ECF No. 71.

BROOKLYN, NY – The United States Attorney’s Office for the Eastern District of New York and the Department of Justice, Consumer Protection Branch, together with the Federal Trade Commission (FTC) and the Food and Drug Administration (FDA), today announced a civil enforcement action against defendants B4B Earth Tea LLC, B4B Corp., and Andrew Martin Sinclair for alleged violations of the COVID-19 Consumer Protection Act, the Federal Trade Commission Act, and the Federal Food, Drug, and Cosmetic Act.

According to a complaint filed in federal court in Brooklyn, the defendants advertised that their herbal tea product, Earth Tea, could prevent or treat COVID-19.  For example, the defendants allegedly advertised on social media that Earth Tea is the “most effective [t]reatment against” COVID-19, that it “works within minutes” and will enable consumers to “get out of quarantine within 24 hours guaranteed.”  The defendants had no competent or reliable scientific evidence to support those claims. Further, the defendants allegedly made deceptive statements about a purported scientific study to bolster their unproven COVID-19 claims. The complaint also alleges that Earth Tea is an unapproved new drug that the defendants are selling in violation of the Federal Food, Drug, and Cosmetic Act. The complaint seeks civil penalties, as well as a permanent injunction to stop the defendants from continuing their unlawful marketing and sales of Earth Tea.

The COVID-19 Consumer Protection Act, passed by Congress in December 2020, prohibits deceptive acts or practices associated with the treatment, cure, prevention, mitigation, or diagnosis of COVID-19. Persons who violate the COVID-19 Consumer Protection Act may be subject to civil penalties, injunctive relief, and other remedies available under the FTC Act. The complaint also alleges violations of the FTC Act, which prohibits unfair and deceptive conduct and false advertising.

The Federal Food, Drug, and Cosmetic Act provides that a product is an unapproved new drug if it is intended for use in the diagnosis, cure, mitigation, treatment, or prevention of disease in humans but is not generally recognized as safe and effective for its intended uses and is not the subject of an FDA approval. Remedies for violation of the Federal Food, Drug, and Cosmetic Act include injunctive relief.  

“COVID-19 has tragically claimed nearly one million lives in this country and close to six million lives worldwide,” stated United States Attorney Breon Peace. “Unfortunately, there are too many people who are taking advantage of this crisis by pushing alleged treatment products that are nothing more than snake oil. We will not tolerate attempts to make a dishonest dollar while putting our communities at risk during a pandemic.”

“The Department of Justice will not tolerate individuals or companies seeking to profit from the COVID-19 public health emergency by unlawfully advertising unproven products,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Department of Justice’s Civil Division. “The department is committed to protecting consumers and enforcing the COVID-19 Consumer Protection Act and the FDCA against those who unlawfully market unproven COVID-19 treatments.”

“Products like this may delay patients from seeking proven treatments from their health care provider. Preying on patients’ vulnerabilities during the COVID-19 pandemic is unacceptable,” stated Judy McMeekin, Pharm.D., FDA’s Associate Commissioner for Regulatory Affairs.  “The FDA will continue to actively monitor the U.S. market for any companies or individuals falsely marketing products with claims it prevents or treats COVID-19, and will take actions against those who violate the law and endanger patients.”

“Without any scientific evidence, the defendants claimed that drinking their herbal tea is more effective in preventing COVID-19 than approved vaccines, and cures anyone who has gotten ill within 24 hours,” stated Samuel Levine, Director of the FTC’s Bureau of Consumer Protection. “In bringing this matter with our partners at the Department of Justice and the Food and Drug Administration, the Commission continues its commitment to using every tool available to stop and deter those who would treat the pandemic as opportunity to peddle bogus treatments.”

This matter is being handled by Assistant U.S. Attorney Michael Blume of the U.S. Attorney’s Office for the Eastern District of New York, Senior Trial Attorney James T. Nelson and Trial Attorney Zachary A. Dietert of the Civil Division’s Consumer Protection Branch.  Robert Van Someren Greve represents the FTC, and Michael Shane represents the FDA.

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

The United States Attorney’s Office for the Eastern District of New York recently announced a Consumer Protection Team in the Office’s Civil Division at  https://www.justice.gov/usao-edny/pr/united-states-attorney-breon-peace-announces-formation-consumer-protection-team-office. The Consumer Protection Team will pursue all appropriate measures to stop culpable entities and individuals that engage in conduct threatening the health, safety, economic security, or dignity of potentially vulnerable individuals.  For more information on the U.S. Attorney’s Office, or to report suspected consumer fraud, please visit https://www.justice.gov/usao-edny. 

The Defendants:

B4B Earth Tea LLC

B4B Corp.

Andrew Martin Sinclair

E.D.N.Y. Docket No. 22-CV-1159

Breon Peace, United States Attorney for the Eastern District of New York, announced today the creation of a Consumer Protection Team in the Office’s Civil Division.  The Consumer Protection Team, comprised of six Civil Division Assistant U.S. Attorneys, including the Civil Division’s Chief of Affirmative Civil Enforcement, enhances the Office’s focus on protecting the health, safety, economic security, and dignity of individuals in the Eastern District of New York and nationwide, including our most vulnerable residents – older adults and children.  The Office has responsibility for the enforcement of our nation’s laws in the Eastern District of New York, which encompasses three of the five boroughs of New York City – Brooklyn, Queens and Staten Island – and Nassau and Suffolk Counties on Long Island.  The Eastern District of New York encompasses over eight million people.

This Office has long been committed to bringing high-impact consumer protection cases.  Together with its law enforcement partners, the Office has enjoined robocall scams, interdicted mass mailing fraud schemes, stopped the distribution of adulterated and misbranded dietary supplements, and brought other first-of-a-kind cases in this area.  The Consumer Protection Team will strengthen the Office’s capacity to investigate and enforce laws that protect potentially vulnerable individuals from current and emerging consumer threats.  The Consumer Protection Team will pursue all appropriate measures to stop culpable entities and individuals that engage in conduct threatening the health, safety, economic security, or dignity of those individuals, including affirmative civil enforcement cases seeking injunctive relief, civil penalties, equitable monetary relief, and corrective action.  Among the areas that the Consumer Protection Team will focus on are financial frauds and scams; fraudulent and deceptive marketing practices; consumer product safety; food, drug, and dietary supplement safety; and other conduct that may cause or threaten to cause serious harm to the people in this district and throughout the country. 

In announcing the formation of the Consumer Protection Team, United States Attorney Peace stated: “I am proud to announce the formation of our Consumer Protection Team which will enhance our Office’s ability to protect older adults, children, and other potentially vulnerable victims from insidious fraud schemes and other illegal conduct committed by those who disregard the health, safety, and economic security of our residents for their own gain.  Our goal is to use all available means to protect the residents of the Eastern District and improve their lives.  The Consumer Protection Team is a critical part of the Office’s longstanding commitment to vigorously pursue those who prey on the public through increasingly sophisticated schemes.” 

“The Civil Division’s Consumer Protection Branch is pleased to strengthen its longstanding partnership with the U.S. Attorney’s Office for the Eastern District of New York,” stated Deputy Assistant Attorney General Arun G. Rao for the Justice Department’s Consumer Protection Branch. “We look forward to working with the office’s newly-formed Consumer Protection Team to advance significant consumer protection investigations and litigation. Our combined efforts will help safeguard the health, safety, economic security, and identity integrity of older adults, children, and other potentially vulnerable individuals both in the Eastern District of New York and throughout the United States.”

The Consumer Protection Team is led by the Civil Division’s Chief of Affirmative Civil Enforcement, Bonni J. Perlin; the Consumer Protection Team is made up of Assistant U.S. Attorneys Michael Blume, Michael Castiglione, David Cooper, Melanie Speight, and Kevin Yim.  The Consumer Protection Team is overseen by Civil Division Chief Joseph A. Marutollo and Civil Division Deputy Chief Richard K. Hayes.  The Team will continue to partner and coordinate with the Department of Justice’s Consumer Protection Branch and federal agencies.  

Earlier today, in federal court in Brooklyn, Blaise Caroleo was sentenced by United States District Judge Eric N. Vitaliano to 30 years in prison for sexual exploitation of a minor.  Caroleo pleaded guilty to the charge in November 2019. 

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

“Today’s lengthy sentence underscores the commitment of this Office to seeking justice and healing for children who are sexually abused and exploited,” stated United States Attorney Peace. “We will continue to prosecute dangerous online predators like the defendant who victimize vulnerable minors.”  Mr. Peace thanked the Federal Bureau of Investigation, New York Field Office (FBI) and the FBI’s Human Trafficking and Child Exploitation Task Force for their investigative work on the case.

Between approximately January 24, 2016, and October 12, 2016, Caroleo enticed a 14-year-old girl to produce sexually explicit images of herself, and to send these images to him using an Internet application called Kik.  The account username for the application on Caroleo’s cell phone was “Nimfeater.”  A review of Nimfeater’s Kik account revealed a series of messages in which Caroleo requested sexually explicit photos of Kik users who have been identified as minors, some as young as 12 years old. 

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

The government’s case is being prosecuted by Assistant United States Attorneys Nicholas Axelrod and Erin E. Argo. 

The Defendant:

BLAISE CAROLEO
Age:  57
Staten Island, NY

E.D.N.Y. Docket No. 17-CR-177 (S-1) (ENV)

Earlier today, in federal court in Brooklyn, Peter Tuccio, an associate of the Gambino organized crime family of La Cosa Nostra, was sentenced by United States District Judge LaShann DeArcy Hall to 10 years’ imprisonment for his involvement in setting a car on fire to extract extortion payments.  The Court also ordered Tuccio to pay more than $75,000 in restitution.  Tuccio pleaded guilty in January 2021 to using fire to commit one or more felonies.  

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 sentence.

“Today, Tuccio pays a steep price for the dangerous actions he took to extort payments to the mob,” stated United States Attorney Peace.  “No residents or businesses should have to operate under the threat of violence or intimidation from organized crime.  Let Tuccio serve as an example that this behavior will not be tolerated.”  Mr. Peace thanked the New York City Fire Department’s Bureau of Fire Investigation for their outstanding work on the case.

“The primary mission of the NYPD and our law enforcement partners is to arrest, prosecute, and send away with meaningful prison sentences those who instill fear in New Yorkers through their criminal actions,” stated NYPD Commissioner Sewell.  “With today’s sentence, the result of our efforts is tangible.  I thank our colleagues at the FBI and the Eastern District of New York for their dedication in helping us hold accountable anyone who commits violence in order to spread fear, especially when it’s in the form of organized crime.”

As alleged in court filings, in 2015, a businessman who had been extorted for years by a captain in the Gambino crime family (referred to in court filings as “Co-Conspirator 1”), began avoiding Co-Conspirator 1 in an effort to stop making his annual extortionate payment.  On December 3, 2015, Tuccio and his co-conspirators observed the businessman leave a smoke shop in Howard Beach and drive away in his 2014 Mercedes Benz.  They followed the businessman at a high rate of speed through the streets of Queens and confronted him outside a pizzeria, where Tuccio asked about Co-Conspirator 1 by name and complimented the businessman’s car.  Tuccio and his co-conspirators schemed to set the businessman’s car on fire as a message to the businessman that he had to continue making payments to Co-Conspirator 1.  Later that night, the businessman heard a loud noise and saw that his car was on fire outside of his residence.  After the arson, the businessman made additional payments to Co-Conspirator 1. 

The government’s case is being handled by the Office’s Organized Crime & Gangs Section.  Assistant United States Attorneys Nadia E. Moore, Nicholas J. Moscow and Lindsey R. Oken are in charge of the prosecution.

The Defendant:

PETER TUCCIO
Age:  29
Howard Beach, New York

E.D.N.Y. Docket No. 18-CR-610 (S-1) (LDH)

An indictment was filed yesterday in federal court in Brooklyn charging Stephen Burton and James Wellesley, both citizens of the United Kingdom, with wire fraud conspiracy, wire fraud and money laundering conspiracy in connection with a scheme perpetrated through their company, Bordeaux Cellars, the trade name for two private limited companies, Bordeaux Cellars, Limited and Bordeaux Cellars London Ltd., registered, respectively, in Hong Kong and London, England.  Wellesley was arrested on February 4, 2022 in the United Kingdom and Burton remains at large.

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. 

“Unlike the fine wine they purported to possess, the defendants’ repeated lies to investors did not age well.  As alleged, these defendants duped investors by offering them an intoxicating investment opportunity collateralized by valuable bottles of fine wine that turned out to be too good to be true,” stated United States Attorney Peace.  “This Office and our law enforcement partners will work to protect investors from deceptive schemes and ensure that loans that are financed with investor funds are not stolen by fraudsters.”  Mr. Peace also thanked Internal Revenue Service Criminal Investigation for their work on the case.

“Burton and Wellesley, as alleged, lied to their victims to get them to invest in what ended up being a nearly $100 million scheme. Today’s indictment brings their criminal activity to light and reminds other like-minded criminals that illegal investment fraud schemes won’t be overlooked,” stated FBI Assistant Director-in-Charge Driscoll.

The indictment alleges that from at least June 2017 and continuing through February of 2019, the defendants posed as executives of a company called Bordeaux Cellars.  The defendants solicited investors, including residents of the Eastern District of New York, at investor conferences held in the United States and overseas.  The defendants claimed to investors that Bordeaux Cellars brokered loans between investors and high-net-worth wine collectors that would be fully collateralized by high-value collections of wine.  The defendants promised that investors would receive regular interest payments from the borrowers, and that Bordeaux Cellars would keep custody of the wine pledged as collateral while the loans were outstanding.  As alleged, these representations were false, the “high-net-worth wine collectors” did not actually exist and Bordeaux Cellars did not maintain custody of the wine purportedly securing the loans.  Instead, the defendants used incoming loan proceeds to make fraudulent interest payments to investors and for their own personal expenses.  Burton is a fugitive. Anyone with information related to his whereabouts is asked to contact the FBI by calling 1-800-CALL-FBI or by visiting tips.fbi.gov

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 20 years in prison. 

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

The Defendants:

STEPHEN BURTON
Age:  57
United Kingdom

JAMES WELLESLEY
Age:  55
United Kingdom

E.D.N.Y. Docket No. 22-CR-79 (PKC)

Earlier today, in federal court in Central Islip, Robert Fehring pleaded guilty before United States District Judge Joanna Seybert to mailing more than 20 letters threatening to assault, shoot, and bomb LGBTQ+ affiliated individuals, organizations and businesses.  When sentenced, Fehring faces up to five years’ imprisonment. 

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 Rodney K. Harrison, Commissioner, Suffolk County Police Department (SCPD), announced the guilty plea.

“In pleading guilty today, the defendant admits that he sent hate-filled communications that threatened mass shootings, bombings and other fatal attacks, to members of the LGBTQ+ community,” stated United States Attorney Peace.  “This Office will use all of its available law enforcement tools to protect the safety and civil rights of the LGBTQ+ community and every other community. We will not tolerate hateful threats intended to invoke fear and division, and we will hold accountable those who make or act on such threats.”

Mr. Peace also expressed his gratitude to the Suffolk County District Attorney’s Office for their assistance in the investigation.   

“Today’s guilty plea further highlights Fehring’s intentions, and underscores the FBI’s commitment to vigorously investigating civil rights violations. Anonymous threats against members of our community will eventually be uncovered, and those who are responsible for them will be held accountable,” stated FBI Assistant Director-in-Charge Driscoll.

“We have absolutely no tolerance for hate incidents of any kind here in Suffolk County and I hope that this guilty plea gives peace of mind to both the victims and the entire LGBTQ+ community,” stated SCPD Commissioner Harrison.  “Our department remains laser focused on holding individuals who carry out acts of hate accountable and I thank all of our law enforcement partners who helped bring quick closure to this case.”

As set forth in the court filings and today’s proceeding, from at least 2013 to 2021, Fehring sent letters threatening violence to individuals associated with the LGBTQ+ community.  In those letters, Fehring threatened to use firearms and explosives against the recipients. One such letter threatened that there would “be radio-cont[r]olled devices placed at numerous strategic places” at the 2021 New York City Pride March with “firepower” that would “make the 2016 Orlando Pulse Nightclub shooting look like a cakewalk,” referencing the 2016 attack in which 49 persons were killed and dozens wounded at Pulse, a gay nightclub in Orlando, Florida.  Fehring also sent a threatening letter to the owner of a barbershop affiliated with the LGTBQ+ community in Brooklyn, New York, which stated, in part, “your shop is the perfect place for a bombing . . . or beating the scum that frequents your den of [expletive] into a bloody pool of steaming flesh.”  Fehring mailed dozens of additional threatening letters to individuals, businesses, and elected officials associated with the LGBTQ+ community.

On November 18, 2021, the FBI’s Civil Rights Squad and the New York Joint Terrorism Task Force executed a search warrant at Fehring’s home in Bayport and recovered copies of letters containing threats, supplies used to mail threatening letters, 20 LGBTQ+ related Pride flags that appeared identical to flags stolen from flagpoles in Sayville in July 2021, and reconnaissance-style photographs from a June 2021 Pride event in East Meadow.  Law enforcement officers also recovered electronic devices owned by Fehring that contained internet searches for Fehring’s victims and related LGBTQ+ affiliated individual, events, and businesses.  Law enforcement officers also recovered from Fehring’s residence two loaded shotguns, hundreds of rounds of ammunition, two stun guns, and a stamped envelope addressed to an LGBTQ+ affiliated attorney containing the remains of a dead bird.

The government’s case is being handled by the Office’s National Security and Cybercrime Section, Civil Rights Section, and Long Island Criminal Division. Assistant United States Attorneys Francisco J. Navarro, Rachel A. Bennek, and Andrew P. Wenzel are in charge of the prosecution.

The Defendant:

ROBERT FEHRING
Age:  74
Bayport, New York

E.D.N.Y. Docket No. 22-CR-059 (JS)

An indictment was unsealed today in federal court in Brooklyn charging Jia Liu, a member of the United States Marine Corps Reserve, and Steven Rodriguez, a nurse at a clinic in Hempstead, New York, with one count of conspiring to defraud the United States Department of Health and Human Services and one count of conspiring to commit forgery in connection with their scheme to distribute and sell false COVID-19 Vaccination Cards.  Liu, a Marine Corps reservist, is additionally charged with one count of conspiring to defraud the United States Department of Defense for providing these cards to United States Marine Corps reservists.  The defendants were arrested this morning and will make their initial appearance this afternoon before United States Magistrate Judge Sanket J. Bulsara.

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), announced the arrest and charges.

“As alleged, by deliberately distributing fraudulent COVID-19 vaccination cards to the unvaccinated, the defendants put military and other communities at risk of contracting a virus that has already claimed nearly one million lives in this country,” stated United States Attorney Peace.  “This Office remains committed to rooting out and prosecuting those individuals who threaten our public health and safety for profit.”

“The COVID-19 vaccination card fraud scheme allegedly perpetrated by Liu and Rodriguez resulted in more than 300 stolen or false vaccination cards circulating throughout the community, and in the destruction of multiple doses of a vaccine intended to protect people from the most severe effects of the virus. Schemers who defraud the government in any way—and profit from pocketing the funds—will continue to be held accountable,” stated FBI Special Agent-in-Charge Driscoll.

The indictment alleges that from at least March 2021 to February 2022, the defendants conspired to steal and forge COVID-19 Vaccination Cards to falsely record persons as immunized with vaccines that protect against COVID-19, when in reality, they had not been immunized.  In addition to selling stolen and false cards to unvaccinated persons, Liu and Rodriguez also conspired to enter false COVID-19 vaccination records into New York state databases, allowing unvaccinated individuals to receive the Excelsior Pass, which displays a user’s vaccination status in a digital app.

According to court documents, Liu purchased blank COVID-19 Vaccination Cards from Rodriguez, and then forged and distributed them to buyers and other co-conspirators for a profit. Liu also directed buyers to meet Rodriguez in person at the healthcare clinic to purchase fraudulent cards.  Rodriguez would meet the buyer, but instead of administering the vaccine he destroyed a vial of vaccine intended to be used to vaccinate a patient. He then provided a forged COVID-19 Vaccination Card to the buyer that he completed to make it falsely appear that the buyer had received a dose of vaccine. He further made entries in the Immunization Databases falsely indicating that the buyer had been vaccinated.

After the U.S. Department of Defense imposed a requirement that all active and reserve military service members be vaccinated against COVID-19, from August 2021 to January 2022, Liu created and distributed false COVID-19 Vaccination Cards to United States Marine Corps reservists to help them evade vaccination requirements.

The defendants promoted their scheme through messages on encrypted messaging applications and on social media.  They referred to COVID-19 Vaccination Cards using code names, such as “gift cards,” “Cardi Bs,” “Christmas cards” and “Pokemon cards.”  The defendants distributed at least 300 stolen or false COVID-19 Vaccination Cards and created more than 70 false entries in the Immunization Databases.

All COVID-19 vaccination providers are required to give individuals who receive a COVID-19 vaccine a COVID-19 Vaccination Card. These COVID-19 Vaccination Cards list the name and date of birth of the patient, name of the manufacturer of the COVID-19 vaccine that the patient received, the date the patient receives it, the lot number of the vaccine dose, and the location where each dose is administered.

Proof of vaccination, as reflected in a COVID-19 Vaccination Card or Excelsior Pass, is required to travel to certain locations and attend certain events where large numbers of people congregate, such as sporting events, concerts, restaurants, and bars. In addition, some employers and government agencies require employees to have received a COVID-19 vaccination. Proof of vaccination requirements are intended to limit the spread of COVID-19 and maximize the safety of the community.  In April 2021, the State of New York established the Excelsior Pass. Using patient data recorded in Immunization Databases, an Excelsior Pass stores and displays a user’s vaccination status in a digital app. The pass is intended to be shown at participating businesses and venues as proof of vaccination.

The charges in the indictment are allegations, and the defendant is presumed innocent unless and until proven guilty.  If convicted, the defendants face up to 10 years in prison.

The government’s case is being handled by the Office’s General Crimes Section.  Assistant United States Attorney Adam Amir is in charge of the prosecution.

The Defendants:

JIA LIU
Age:  26         
Queens, New York

STEVEN RODRIGUEZ
Age:  27
Long Beach, New York

E.D.N.Y. Docket No. 22-CR-70 (DG)

A criminal complaint was unsealed today in federal court in Brooklyn charging Romean Brown, Tyrek Clarke, Kennith Desir, Stephan Dorminvil, Kai Heyward, Keith James, Oneal Marks, Jahriah Olivierre, Christopher Jean Pierre, Roleeke Smith and Christopher Topey with conspiracy to commit access device fraud and aggravated identity theft in connection with a scheme to obtain millions of dollars in unemployment insurance benefits funded, in whole or in part, by COVID-19 pandemic assistance programs.  Eight defendants were arrested this morning in New York City and will make their initial appearances this afternoon before United States Magistrate Judge Sanket J. Bulsara.  Heyward was arrested in Delaware and will make his initial appearance this afternoon in federal court in Wilmington.  Brown was arrested in California and will make his initial appearance this afternoon in federal court in Los Angeles.  Olivierre remains at large.

Breon Peace, United States Attorney for the Eastern District of New York, Jonathan Mellone, Special Agent-in-Charge, U.S. Department of Labor, Office of Inspector General, New York Regional Office (DOL-OIG), and Keechant L. Sewell, Commissioner, New York City Police Department (NYPD), announced the arrests and charges.

“As alleged, the defendants conspired to steal millions of dollars in pandemic-related unemployment assistance and then brazenly flaunted the proceeds of their crimes on social media,” stated United States Attorney Peace.  “These government programs are designed to provide financial assistance to those who are most in need during an unprecedented pandemic.  This Office and its law enforcement partners will vigorously prosecute gang members and anyone else who exploits the pandemic and steals from taxpayer-funded programs."

Mr. Peace also thanked the New York State Department of Labor for its assistance during the investigation.

“The Unemployment Insurance Program exists to provide needed assistance to qualified individuals who are unemployed due to no fault of their own.  Fraud against the Unemployment Insurance Program distracts state workforce agencies, like the New York State Department of Labor, from ensuring benefits go to individuals who are eligible to receive them. The Office of Inspector General will continue to work closely with our many law enforcement partners, to investigate those who exploit the Unemployment Insurance Program,” stated DOL-OIG Special Agent-in-Charge Mellone.

“COVID benefit payments were meant to keep Americans who lost jobs, income, and financial stability from drowning in debt. These funds were never intended to be a multi-million dollar slush fund to pay for rented Beverly Hills mansions, high-end restaurants and expensive foreign cars for members of gangs and crews connected to gun violence in New York City. I commend the work of the NYPD Intelligence Bureau’s Criminal Investigation Section and our partners in the Department of Labor Office of the Inspector General as well as the prosecutors for the United States Attorney for the Eastern District of New York for their work on this investigation,” stated NYPD Commissioner Sewell.

As alleged in the complaint, the defendants are all members or associates of the Brooklyn-based Woo gang.  Between March 2020 and October 2021, the defendants used the personally identifiable information of more than 800 victims to submit nearly 1,000 claims to the New York State Department of Labor for unemployment insurance benefits funded, in whole or in part, by COVID-19 pandemic assistance programs.  The defendants ultimately obtained approximately $4.3 million in unemployment insurance after having filed for approximately $20 million in benefits.  During the period of the charged conspiracy, the defendants posted photos of themselves on social media flashing gang signs, standing in front of luxury vehicles, and holding stacks of United States currency.  Several of the defendants appeared in a music video entitled “Trappin,” which was posted to YouTube on May 8, 2021.  The lyrics of the song include, “Unemployment got us workin’ a lot,” a reference to the defendants’ fraudulent scheme.  

In response to the COVID-19 pandemic, Congress established programs and provided additional funding for unemployment insurance benefits for unemployed persons.  These programs included the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), which was signed into law on March 27, 2020, and created programs for pandemic unemployment assistance and federal pandemic unemployment compensation.

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

The government’s case is being prosecuted by the Office’s Organized Crime and Gangs Section and Public Integrity Section.  Assistant United States Attorneys Michael W. Gibaldi and Robert Polemeni are in charge of the prosecution.

The Defendants:

ROMEAN BROWN
Age: 23
Los Angeles, California

TYREK CLARKE
Age: 21
Miami, Florida

KENNITH DESIR
Age: 20
Brooklyn, New York

STEPhAN DORMINVIL
Age: 21
Brooklyn, New York

KAI HEYWARD
Age: 22
Brooklyn, New York

KEITH JAMES
Age: 20
Brooklyn, New York

ONEAL MARKS
Age: 20
Brooklyn, New York

JAHRIAH OLIVIERRE
Age: 22
Brooklyn, New York

CHRISTOPHER JEAN PIERRE
Age: 21
Brooklyn, New York

ROLEEKE SMITH
Age: 20
Brooklyn, New York

CHRISTOPHER TOPEY
Age: 21
Brooklyn, New York

E.D.N.Y. Docket No. 22-MJ-169

Earlier today, at the federal courthouse in Brooklyn, Andrew Campos, a captain in the Gambino organized crime family of La Cosa Nostra, was sentenced by United States District Judge Ann M. Donnelly to 37 months’ imprisonment for racketeering conspiracy.  The Court also ordered Campos to pay $1 million in restitution and a $15,000 fine.  Campos pleaded guilty to the charge in January 2021, admitting his participation in various predicate acts of wire fraud and money laundering. 

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); Thomas Fattorusso, Special Agent-in-Charge, Internal Revenue Service Criminal Investigation (IRS-CI); and Keechant Sewell, Commissioner, New York City Police Department (NYPD), announced the sentence.

“As a captain in the Gambino crime family, Campos has engaged in multiple fraud and money laundering schemes and maintained the corrosive influence of organized crime in the construction industry,” stated United States Attorney Peace.  “This Office, together with its law enforcement partners, will continue to pursue all investigative avenues to deter, interrupt and hold accountable members of organized crime who seek to line their pockets at the expense of businesses and taxpayers.”  Mr. Peace expressed his appreciation to the Queens County District Attorney’s Office, the United States Probation Departments for the Eastern and Southern Districts of New York, the Waterfront Commission of New York Harbor and the United States Department of Labor for their assistance during the investigation.

“Andrew Campos led a scheme that lined his pockets and cheated taxpayers.  He failed to pay more than $1 million in payroll taxes and laundered money to build his personal residence,” stated IRS-CI Special Agent-in-Charge Fattorusso.  “Criminals, take note. Trying to cheat the system is not the way to do business.”

Campos and his co-conspirators carried out multiple fraudulent schemes to earn millions of dollars in criminal proceeds, in part through their operation of a carpentry company, CWC Contracting Corp. (“CWC”).  Campos helped orchestrate a massive scheme to defraud the IRS by failing to pay approximately $1.3 million in payroll taxes owed to the federal government by paying CWC employees millions of dollars in cash without making the required payroll tax withholdings and payments.  Campos and others also laundered money through a scheme by which checks were made out to others and cashed, purportedly for work performed in connection with CWC construction projects, but where, in fact, no services were performed, and the proceeds were used to construct Campos’s residence.  Campos and his co-conspirators also fraudulently procured cards from the United States Department of Labor indicating completion of certain Occupational Safety and Health Administration training courses when, in fact, the courses were never completed.  Further, as found by the Court at sentencing, between approximately June 2018 and June 2019, CWC paid hundreds of thousands of dollars in bribes and kickbacks to employees of a real estate development company.  CWC paid the bribes in the form of hundreds of thousands of dollars’ worth of free labor and materials used for renovations on a co-defendant’s residence. 

The government’s case is being handled by the Office’s Organized Crime & Gangs Section.  Assistant United States Attorney Kayla C. Bensing is in charge of the prosecution, assisted by Eastern District of New York Special Agent Erik Nesbitt.  Assistant United States Attorney Claire S. Kedeshian of the Office’s Asset Recovery Section is handling forfeiture matters. 

The Defendants:

ANDREW CAMPOS
Age: 51
Scarsdale, New York

E.D.N.Y. Docket No. 19-CR-575 (AMD)

Five members of a family-run sex trafficking organization were sentenced this week to prison terms of nearly 40 years in prison by United States District Judge Allyne R. Ross in federal court in Brooklyn.   Jose Miguel Melendez-Rojas was sentenced to 39 years and six months in prison; Jose Osvaldo Melendez-Rojas and Rosalio Melendez-Rojas were each sentenced to 39 years and four months in prison; Francisco Melendez-Perez and Abel Romero-Melendez were sentenced to 25 years and 20 years in prison respectively.  The defendants were also ordered to pay restitution to their victims.  The defendants were convicted by a federal jury in March 2020 of sex trafficking, sex trafficking conspiracy, sex trafficking of minors, interstate prostitution, alien smuggling and money laundering conspiracy.  A sixth co-defendant, Fabian Reyes-Rojas, pleaded guilty to sex trafficking conspiracy and sex trafficking in December 2019 and is awaiting sentencing. 

“Through false promises of a better life, the defendants ensnared young, vulnerable victims in a sordid world of sex-trafficking and used violence and cruel threats to force them into prostitution,” stated United States Attorney Peace. “Today’s lengthy sentence reflects the immeasurable harm the defendants’ brutality and exploitation inflicted on these young women and girls, and the commitment of this Office and its law enforcement partners to combating human trafficking in all its forms,” stated United States Attorney Peace.  “I applaud the courage shown by the victims who testified and hope that the sentences the Court meted out will help them find closure on their path to healing. I commend the diligent and compassionate work of Eastern District of New York prosecutors and HSI agents and thank them for bringing the defendants to justice.”

“The traffickers in this case used deception and coercion to sell dreams of a better life in the United States to young and impressionable women, who arrived only to be forced into a life of torment, misery, sexual abuse and prostitution at the hands of their captors,” stated HSI Acting Special Agent-in-Charge Patel.  “The conviction and sentencing of these traffickers represent the culmination of an imperative investigation and could not have been possible without the cooperation and testimony of these brave victims, whose boundless courage led to justice for the heinous and reprehensible acts committed against them.  HSI New York’s Human Trafficking Task Force combines federal, state, local and international resources to combat human trafficking by working hand-in-hand with our law enforcement partners to identify and dismantle criminal networks engaged in human trafficking and provide protection, assistance, and safe haven to victims.”

Between 2006 and July 2017, the defendants transported young and vulnerable Mexican women and girls, some of whom were minors, to the United States and forced them to work in prostitution.  The defendants used false promises of love, marriage, and a better life to lure the women and girls into romantic and sexual relationships and isolated their victims from their families by bringing them to live with them at the defendants’ homes in Tenancingo, Mexico.  The defendants then used physical and sexual violence, threats, and fraud to coerce their victims to work in prostitution in New York City, Long Island, New Jersey, Connecticut and Delaware.  The defendants took the proceeds generated from the victims’ prostitution and laundered them to conceal their source.

Six victim-witnesses testified at trial regarding the physical and sexual abuse they endured at the hands of the defendants.  One victim identified as “Diana” testified that she was smuggled into the United States as a minor and forced to work as a prostitute.  When she tried to escape, Jose Miguel Melendez-Rojas beat and raped her in front of other members of the household, including Rosalio Melendez-Rojas and Abel Romero-Melendez.  Another victim identified as “Delia” testified that she was forced into prostitution by Francisco Melendez-Perez and his uncle Rosalio Melendez-Rojas when she was 14 years old.  When she refused to work, she was beaten.  Victims “Fabiola” and “Maria Rosalba” also testified that they were forced to work as prostitutes through threats, physical abuse and forced abortions by Rosalio Melendez-Rojas and Jose Osvaldo Melendez-Rojas.  Victim “Daisy” testified that she was forced into prostitution by Fabian Reyes-Rojas.  Victim “Veronica” testified at trial that Jose Miguel Melendez-Rojas threatened her and her family, telling her that he would “chop [her] mother up into little pieces” if she did not work in prostitution for his benefit. 

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 the bilateral 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 more than 170 defendants in multiple cases in Georgia, New York, Florida and Texas, in addition to numerous federal and state prosecutions of associated sex traffickers in Mexico.  The convictions in this case are 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 more than 180 victims, including over 40 minors; reunited 19 victims’ children with their mothers; and secured restitution orders of over $4 million on behalf of trafficking victims.

The investigation and prosecution of the defendants was led by the U.S. Attorney’s Office for the Eastern District of New York and HSI New York’s Trafficking in Persons Unit, with assistance from HSI Mexico City Attaché Office, the Department of Justice’s Office of International Affairs, the State Department, Interpol and the New York City Police Department. The government of Mexico, including Mexico’s Procuraduría General de la República and Policía Federal, as well as the National Center for Attention to Cybercrimes against Minors (CENADEM), also played a prominent role in advancing the bilateral anti-trafficking enforcement efforts in this case.  Non-governmental victim service providers and advocates also dedicated efforts to restore and improve the lives of survivors of trafficking and their families.

The government’s case is being handled by the Office’s Civil Rights Section.  Assistant United States Attorneys Tanya Hajjar, Erin Argo and Gillian Kassner are in charge of the prosecution.

If you believe that you or someone you know may be a victim of human trafficking, please contact the National Human Trafficking Resource Center Hotline at   1-888-373-7888, or Text 233733.

The Defendants:

JOSE MIGUEL MELENDEZ-ROJAS
Age: 45
Mexico

FRANCISCO MELENDEZ-PEREZ (also known as “Paco” and “El Mojarra”)
Age: 27
Queens, New York

ABEL ROMERO-MELENDEZ (also known as “La Borrega” and “Borrego”)
Age: 35
Queens, New York

JOSE OSVALDO MELENDEZ-ROJAS
Age: 46
Mexico

ROSALIO MELENDEZ-ROJAS (also known as “Leonel, “Wacho” and “El Guacho”)
Age: 40
Mexico

Co-Defendant To Be Sentenced:

FABIAN REYES-ROJAS
Age: 42
Mexico

E.D.N.Y. Docket No. 17-CR-434 (ARR)

Earlier today, in federal court in Brooklyn, Gerod Woodberry was sentenced by United States District Judge Dora L. Irizarry to 10 years’ imprisonment for a series of bank robberies in December 2019 and January 2020 in Manhattan and Brooklyn.  Woodberry pleaded guilty in July 2021.

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 sentence.

“The defendant has been held accountable in federal court for a 16-day crime spree in which he robbed or attempted to rob six banks,” stated United States Attorney Peace. “I commend the members of law enforcement who apprehended the defendant and ended his string of robberies.”

Woodberry robbed or attempted to rob six New York City banks over a 16 day-period.  After committing or attempting to commit robberies on December 30, 2019, January 3, 2020, January 6, 2020, and January 8, 2020, in Manhattan, Woodberry was arrested and charged in state court in New York County with the December 30, 2019 bank robbery.  On January 10, 2020, Woodberry was released pending trial on the state charges.  Several hours after Woodberry’s release from state custody, he entered a Chase Bank branch located at 20 Flatbush Avenue in Brooklyn, presented a demand note to the teller that read, “THIS IS A ROBBERY BIG BILLS ONLY NO DYE PACKS.”  Woodberry received $1,000 in cash and fled the bank.  On January 14, 2020, Woodberry attempted a sixth robbery at a Citibank branch in Manhattan, where he received no money and fled the bank.  In total, Woodberry stole $3,100 from the three banks that he robbed.

Assistant United States Attorneys Jack Dennehy, Devon Lash and Anna Karamigios are in charge of the prosecution.

The Defendant:

GEROD WOODBERRY
Age:  44
Brooklyn, New York

E.D.N.Y. Docket No. 20-CR-31 (DLI)

Earlier today in federal court in Brooklyn, Ivan Reyes Arzate, a former Mexican Federal Police Officer and Commander of the Mexican Federal Police’s Sensitive Investigative Unit (“SIU”), was sentenced by United States District Judge Brian M. Cogan to 10 years’ imprisonment for participating in a drug trafficking conspiracy.  Reyes Arzate accepted a bribe in exchange for agreeing to assist El Seguimiento 39, a Mexico-based cartel, ship cocaine from Mexico to the United States.  The El Seguimiento 39 cartel is associated with the Sinaloa Cartel, the Beltran Leyva Organization and other Mexico-based cartels.  Reyes Arzate pleaded guilty to the charge in October 2021.

Breon Peace, United States Attorney for the Eastern District of New York; Timothy Foley, Special Agent-in-Charge, Drug Enforcement Administration, New York Division (DEA); Ricky J. Patel, Special Agent-in-Charge, Homeland Security Investigations, New York (HSI); Keechant L. Sewell, Commissioner, New York City Police Department (NYPD); and Kevin P. Bruen, Superintendent, New York State Police (NYSP), announced the sentence.

“In betraying his oath and partners in law enforcement in exchange for cash bribes, Arzate became a willing participant in drug trafficking and in spreading massive and dangerous amounts of cocaine in our communities,” stated United States Attorney Peace.  “Corrupt police officers who use their government positions to further the interests of the drug cartels and harm our communities will be brought to justice and punished for their crimes.  Their badges will not shield them from accountability.”  Mr. Peace expressed his appreciation to the United States Attorney’s Offices for the Southern District of California and the Northern District of Illinois for their assistance on the case.

“Reyes Arzate’s crimes were an affront to law enforcement, especially those working to suppress illegal drug’s from hitting American streets.   Today’s sentencing demonstrates DEA and our law enforcement partners’ commitment to the Rule of Law.  I commend the New York Strike Force and the U.S. Attorney’s Office Eastern District of New York for their diligent work,” stated DEA Special Agent-in-Charge Foley.

“Azarte was entrusted with protecting the people of Mexico as a public servant, but instead served himself by lining his pockets with cartel cash,” stated HSI Acting Special Agent- in-Charge Patel.  “Azarte betrayed his country, his community, and his brothers and sisters in law enforcement when he took bribes in exchange for valuable law enforcement information and conspired with narcotics traffickers to import hundreds of kilograms of cocaine into the United States.  Today’s sentence sends a clear message that anyone who violates their oath of office and decides to partner with drug cartels will face severe consequences and will be held accountable for their reprehensible violation of the public’s trust.”

According to court filings, SIU officers in Mexico routinely work with U.S. law enforcement to combat narcotics trafficking, money laundering and other criminal activities. From 2003 to 2016, Reyes Arzate was a Mexican Federal Police Officer assigned to SIU.  In 2008, he was appointed SIU Commander, making him its highest-ranking officer and principal point of contact for information sharing between U.S. and Mexican law enforcement personnel assigned to the SIU.

In approximately November 2016, while participating in a joint investigation of El Seguimiento 39 with U.S. law enforcement authorities, Reyes Arzate met with the leadership of El Seguimiento 39, shared with them information about the U.S. law enforcement investigation, and accepted a $290,000 bribe in exchange for his agreement to assist the cartel. The amount of cocaine involved in the conspiracy attributable to the defendant as a result of his conduct, and the conduct of others, was more than 450 kilograms.

This 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 DEA 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, NYPD, NYSP, HSI, 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 and Public Integrity Section.  Assistant United States Attorneys Ryan Harris and Philip Pilmar are in charge of the prosecution.

The Defendant:

IVAN REYES ARZATE
Age:  49
Mexico City, Mexico

E.D.N.Y. Docket No. 20-CR-30 (BMC)

Earlier today, in federal court in Central Islip, Carlos Argueta, also known as “Violento,” “Desorden” and “Dylan,” a former leader of the Freeport Locos Salvatruchas (Freeport) clique of La Mara Salvatrucha, also known as the MS-13, a transnational criminal organization, was sentenced by United States Circuit Judge Joseph F. Bianco to 30 years’ imprisonment for racketeering and firearms charges in connection with his participation in the June 3, 2016 murder of Jose Pena, an MS-13 member who was suspected of violating the gang’s rules, and the January 15, 2016 attempted murder of a suspected rival gang member outside of the Brentwood public library.  Argueta pleaded guilty to the charges in July 2019.

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 Rodney K. Harrison, Commissioner, Suffolk County Police Department (SCPD), announced the sentence.

“Argueta, a violent leader in the MS-13, shot and wounded a so-called ‘rival’ in broad daylight outside of a public library, and then participated in the pre-planned brutal slashing and stabbing death of one of his alleged MS-13 accomplices in that shooting.  Today’s lengthy sentence ensures that Argueta will no longer inflict senseless violence and bloodshed on our streets,” stated United States Attorney Peace.  “I commend our prosecutors and the Long Island Gang Task Force for their steadfast commitment in bringing MS-13 members to justice and eliminating their violence from our communities.”

“Like so many members of MS-13, Carlos Argueta is without any moral compass and has shown zero regard for human life,” stated SCPD Commissioner Harrison.  “It is up to law enforcement to send a message to this transnational gang that their violent and homicidal actions have no place in Suffolk County.  I would like to thank Eastern District of New York and the Long Island Gang Task Force for their relentless pursuit to ensure individuals like Argueta are held accountable for their crimes.”

On the afternoon of January 15, 2016, Argueta, Pena and several other MS-13 members confronted three suspected rival gang members outside of a public library in Brentwood.  Argueta removed a .45 caliber semi-automatic handgun from his waistband and shot one of the men, identified as John Doe in the superseding indictment, in the torso.  Argueta and the other MS-13 members then fled.  The wounded victim received medical treatment and survived. 

The Suffolk County police subsequently arrested Argueta, Pena and a third MS-13 member in connection with the attempted murder of John Doe, and they were released on bail.  Argueta told other members of the Freeport clique that he suspected that Pena, a member of the Normandie clique of the MS-13, had cooperated with the SCPD.  Additionally, members of the MS-13 suspected that Pena was homosexual, which is unacceptable under the rules of the MS-13.

After consulting with MS-13 leaders in El Salvador, Argueta and other MS-13 members agreed to kill Pena, and Argueta assigned tasks to other MS-13 gang members, including procuring weapons and a vehicle to be used in the murder.  On June 3, 2016, Argueta and other MS-13 members lured Pena into a car and drove to a secluded area in Brentwood.  After walking into the woods, the group attacked Pena, taking turns stabbing and slashing him with knives, and killing him.  Pena’s body was found four months later. 

Today’s sentencing is the latest in a series of federal prosecutions by the United States Attorney’s Office for the Eastern District of New York targeting members of the MS-13, a violent, transnational criminal organization.  The MS-13’s leadership is based in El Salvador, Honduras, Guatemala and Mexico, but the gang has thousands of members across the United States.  With numerous branches, or “cliques,” the MS-13 is the most violent criminal organization on Long Island.  Since 2003, hundreds of MS-13 members, including dozens of clique leaders, have been convicted on federal felony charges in the Eastern District of New York.  A majority of those MS-13 members have been convicted on federal racketeering charges for participating in murders, attempted murders and assaults.  Since 2010, this Office has obtained indictments charging MS-13 members with carrying out more than 60 murders in the Eastern District of New York, and has convicted dozens of MS-13 leaders and members in connection with those murders.  These prosecutions are the product of investigations led by the FBI’s Long Island Gang Task Force, which is comprised of agents and officers of the FBI, SCPD, Nassau County Police Department, Nassau County Sheriff’s Department, Suffolk County Probation Office, Suffolk County Sheriff’s Office, the New York State Police, the Hempstead Police Department, the Rockville Centre Police Department and the New York State Department of Corrections and Community Supervision. 

The government’s case is being handled by the Office’s Long Island Criminal Division.  Assistant United States Attorneys John J. Durham, Paul G. Scotti, Justina L. Geraci and Megan E. Farrell are in charge of the prosecution.

The Defendant:

CARLOS ARGUETA (also known as “Violento,” “Desorden” and “Dylan”)
Age: 22
Brentwood, New York

E.D.N.Y. Docket No. 16-CR-510 (S-2) (JFB)

Earlier today, at the federal courthouse in Central Islip, Donta Riddick pleaded guilty to possession of heroin and fentanyl with intent to distribute on September 15, 2020.  Riddick also admitted to the distribution of heroin and fentanyl on September 13, 2020 that caused the death of a 21-year old resident of Massapequa, New York.  As part of his guilty plea, Riddick agreed to a sentence of 198 months’ imprisonment, to be followed by five years’ supervised release, subject to the Court’s approval.  Today’s proceeding was held before United States District Judge Gary R. Brown.

Breon Peace, United States Attorney for the Eastern District of New York, Timothy Foley, Acting Special Agent-in-Charge, Drug Enforcement Administration, New York Division (DEA), and Patrick J. Ryder, Commissioner, Nassau County Police Department (NCPD), announced the guilty plea.

“Today, the defendant admitted to trafficking heroin laced with fentanyl that caused the overdose death of a young woman on Long Island,” stated United States Attorney Peace.  “The opioid epidemic and the tragic overdose deaths of so many have had a devastating impact on our communities. This Office, together with our federal and local partners, will continue to work tirelessly to prosecute and hold accountable those who contribute to this serious problem.”

“The facts of the case clearly demonstrate fentanyl’s lethal nature.  Today’s guilty plea culminates one of many DEA investigations targeting drug trafficking rings whose illegal actions contribute to the rising drug-related overdose rates. I commend the investigators and prosecutors involved in this case,” stated DEA Acting Special Agent-in-Charge Foley.

“Defendant Donta Riddick did intentionally sell illegal drugs to a young woman who ultimately passed from an overdose of those drugs which were laced with deadly fentanyl. The multi-agency investigation led to the arrest of the defendant which removes a dangerous drug dealer from our communities.  I would like to thank and congratulate all of the investigators and those respective agencies for a job well done,” stated NCPD Commissioner Ryder.

According to court filings and statements made by the defendant at the guilty plea proceeding, on the night of September 13, 2020, Riddick sold fentanyl-laced heroin to the victim, who suffered a fatal overdose at a motel in Massapequa the following morning.  A review of the victim’s cell phone by law enforcement revealed text messages she exchanged with Riddick in which she appeared to be ordering heroin from the defendant.  On September 15, 2020, during the subsequent investigation by the DEA and NCPD, Riddick was arrested in possession of street-level quantities of the same fentanyl-laced heroin that had caused the death of the victim the day before.

The government’s case is being handled by the Office’s Long Island Criminal Division.  Assistant United States Attorneys Charles N. Rose and Samantha Alessi are in charge of the prosecution. 

The Defendant:

DONTA RIDDICK
Age:  35
West Babylon, New York

E.D.N.Y. Docket No. 20-CR-517 (S-1) (GRB)