Eastern District of New York

Earlier today, at the federal courthouse in Brooklyn, former unlicensed mortgage broker Brent Kaufman pleaded guilty before United States District Judge Kiyo A. Matsumoto to a criminal information charging him with stealing $4.7 million in mortgage refinancing proceeds that were meant to pay off the existing mortgages of his clients.  When sentenced, Kaufman faces up to 30 years in prison, as well as forfeiture and a fine of up to $1 million.

Jacquelyn M. Kasulis, Acting 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), Robert W. Manchak, Special Agent-in-Charge, Federal Housing Finance Agency, Office of Inspector General (FHFA-OIG), and Darnell D. Edwards, Acting Inspector-in-Charge, United States Postal Inspection Service, New York Division (USPIS), announced the guilty plea.

“With today’s guilty plea, Kaufman admits to stealing millions of dollars in a brazen mortgage fraud scheme that defrauded numerous lenders and left his homeowner-clients in danger of losing their homes to foreclosure,” stated Acting U.S. Attorney Kasulis.  “This Office is committed to prosecuting defendants like Kaufman who are driven by greed to abuse the trust of innocent homeowners.” Ms. Kasulis expressed her grateful appreciation to the FBI, FHFA-OIG and the USPIS for their outstanding work and assistance in this investigation and prosecution.

“Not only did Kaufman steal his victims’ money, but he also violated their trust, leaving them financially vulnerable and at risk of significant financial complications,” stated FBI Assistant Director-in-Charge Driscoll.  “Collectively, his victims suffered millions of dollars in losses. Today’s guilty plea reminds us of the threat posed by those who prioritize their own financial interests above all else.”

“Brent Kaufman betrayed the trust of unsuspecting homeowners by stealing millions of dollars in mortgage payoffs and failing to repay lenders.  As demonstrated by these charges, FHFA-OIG and its law enforcement partners will investigate and hold accountable those who seek to victimize Fannie Mae and Freddie Mac and misuse the lending process to unjustly enrich themselves,” stated FHFA-OIG Special Agent-in-Charge-Manchak.

“This is a classic case of greed overcoming honest business practices, as Mr. Kaufman took advantage of his access to clients funds to enrich his own lifestyle. His actions left many in financial ruin, holding two mortgages and facing the threat of foreclosure. Law enforcement will always work tirelessly to bring individuals to justice for their crimes against the American public,” stated USPIS Acting Inspector-in-Charge Edwards.

According to court filings and facts presented during the plea proceeding, Kaufman worked as an unlicensed mortgage broker and often assisted clients in Queens and Long Island with refinancing their mortgages.  At the closing for a mortgage refinancing, the money from the new mortgage is supposed to be wired to the financial institution that holds the existing mortgage so that it can be paid off. Between 2016 and 2019, Kaufman, together with others, engaged in a scheme to defraud Home Point Financial Corporation, LoanDepot.com LLC and United Wholesale Mortgage and other mortgage lenders (the “Lenders”) by obtaining, and attempting to obtain, monies and funds from the Lenders by means of materially false representations.  Specifically, Kaufman provided incorrect wire routing information to the Lenders for the existing mortgages.  Instead of wiring the funds to the correct financial institution, the funds were instead transferred to bank accounts controlled by Kaufman.  As a result, the existing mortgages were not paid off—leaving the clients with two mortgages on their homes—and Kaufman stole the funds for his own personal use.

During the period of the charged conduct, Kaufman stole more than over $4.7 million, some of which he used to make mortgage payments on the existing mortgages or to eventually pay off those mortgages to avoid detection of his scheme.  When Kaufman stopped paying the existing mortgages, several of his clients’ homes were foreclosed on.  Victims of the scheme ultimately suffered a loss of approximately $2.5 million.

The government’s case is being prosecuted by Assistant United States Attorneys Jonathan Siegel and Laura Mantell. 

The Defendant:

BRENT KAUFMAN
Age:  50
Commack, New York

E.D.N.Y. Docket No. 21-CR-425 (KAM)

Earlier today, in federal court in Brooklyn, Juliana Barile pleaded guilty to one count of computer intrusion arising from the defendant’s unauthorized intrusion into, and destruction of data on, the computer system of a New York credit union (the “Credit Union”) following her termination as an employee of the Credit Union.  The guilty plea took place before United States District Judge Eric N. Vitaliano.  When sentenced, Barile faces up to 10 years’ imprisonment and a fine. 

Jacquelyn M. Kasulis, Acting 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 guilty plea.

“In an act of revenge for being terminated, Barile surreptitiously accessed the computer system of her former employer, a New York Credit Union, and deleted mortgage loan applications and other sensitive information maintained on its file server,” stated Acting U.S. Attorney Kasulis.  “Protecting private financial data from being compromised or destroyed by unauthorized computer intrusions is an important priority of this Office.”  Ms. Kasulis also thanked New York City Police Department for their valuable assistance with the case.

“Ms. Barile may have thought she was getting back at her employer by deleting files, however she did just as much harm to customers.  Her petty revenge not only created a huge security risk for the bank, but customers also depending on paperwork and approvals to pay for their homes were left scrambling,” stated FBI Assistant Director-in-Charge Driscoll.  “An insider threat can wreak just as much havoc, if not more, than an external criminal. The bank and customers are now faced with the tremendous headache of fixing one employee's selfish actions.”

According to court filings, Barile was fired from her position as a part-time employee with the Credit Union on May 19, 2021.  Two days later, on May 21, 2021, Barile remotely accessed the Credit Union’s file server and deleted more than 20,000 files and almost 3,500 directories, totaling approximately 21.3 gigabytes of data.  The deleted data included files related to mortgage loan applications and the Credit Union’s anti-ransomware protection software.  Barile also opened confidential files.  After she accessed the computer server without authorization and destroyed files, Barile sent text messages to a friend explaining that “I deleted their shared network documents,” referring to the Credit Union’s share drive.  To date, the Credit Union has spent approximately $10,000 in remediating Barile’s unauthorized intrusion and destruction of data.

The government’s case is being handled by the Office’s Cybercrime Task Force and the National Security and Cybercrime Section.  Assistant United States Attorneys David K. Kessler and Meredith A. Arfa are in charge of the prosecution.   

The Eastern District of New York’s Cybercrime Task Force was formed in May 2021 to combat cybercrime, which is proliferating in the United States, including in this district, as well as internationally.  The Task Force’s goals are to initiate cybercrime investigations and prosecutions, disseminate information about emerging cybercrime issues and trends, and heighten awareness about a wide variety of cybercrime schemes.  The Task Force works with our traditional law enforcement partners, including the FBI, the United States Secret Service, Homeland Security Investigations and the Cybersecurity and Infrastructure Security Agency, as well as the Drug Enforcement Administration.  The Task Force also coordinates with regulatory partners, including the U.S. Securities & Exchange Commission and the Federal Trade Commission, as well as state and local counterparts, such as the New York State Department of Financial Services, New York City Cyber Command and the New York City Police Department.

Defendant:

JULIANA BARILE
Age: 35
Brooklyn, New York

E.D.N.Y. Docket No. 21-CR-441 (ENV)

Earlier today, in federal court in Brooklyn, Angelina Barini pleaded guilty before United States Magistrate Judge Ramon E. Reyes, Jr. to distributing narcotics and causing the deaths of two victims.  Specifically, she pleaded guilty to two counts of distributing narcotics that caused the deaths of a person; one count of distributing fentanyl, methamphetamine and cocaine; and one count of conspiring to distribute gamma-butyrolactone (GBL).  When sentenced, Barini faces a minimum of 20 years’ imprisonment and a maximum term of life imprisonment.

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York; Peter C. Fitzhugh, Special Agent-in-Charge, Homeland Security Investigations, New York (HSI); and Dermot F. Shea, Commissioner, New York City Police Department (NYPD), announced the guilty plea.

“With today’s guilty plea, Barini takes responsibility for her actions in distributing lethal doses of opioids that caused the overdose deaths of unsuspecting victims, shattering the lives of their families,” stated Acting U. S. Attorney Kasulis.  “This Office is committed to ending the opioid epidemic and prosecuting defendants like Barini who cause senseless, drug-related deaths in our communities.”

“The scourge of addiction takes many forms, but one of its most devastating effects is that beyond the direct victims of drug overdoses are the families who lose loved ones too soon.  Fentanyl is deadly regardless of social status, age, gender or ethnicity,” stated HSI Special Agent-in-Charge Fitzhugh.  “Barini had no regard for her victims, but has made the right choice by taking responsibility for her actions. HSI and its partners remain resolute in pursuing those who profit from this lethal opioid epidemic.”

As set forth in court filings and at today’s proceeding, between July and August of 2019, Barini provided narcotics to her victims while sometimes conducting business as a sex worker.  On multiple occasions, those narcotics contained lethal doses of fentanyl.  On July 11, 2019, Barini met with a victim at a motel in Woodside, Queens and gave him fentanyl-laced drugs, causing the victim’s overdose death.  On August 5, 2019, Barini met another victim at a residence in College Point, Queens and gave him fentanyl-laced drugs which caused his overdose death.  On July 4, 2019, Barini distributed and possessed with intent to distribute controlled substances containing fentanyl, methamphetamine and cocaine. Additionally, between August 16, 2019 and August 18, 2019, Barini conspired with another person to distribute and possess with intent to distribute a substance containing GBL, a Schedule I controlled substance analogue, commonly referred to as a “date rape” drug.

The government’s case is being handled by the Office’s International Narcotics and Money Laundering Section.  Assistant United States Attorneys Temidayo Aganga-Williams, Andrew Grubin and Andrew Wang are in charge of the prosecution. 

The Defendant:

ANGELINA BARINI
Age: 43
Queens, New York

E.D.N.Y. Docket No. 19-CR-428 (S-2) (BMC)

An indictment was unsealed today in federal court in Central Islip charging Dr.  Barry Arnold, a practicing dentist with an office in Valley Stream, New York, with writing illegal prescriptions to women for oxycodone, a Schedule II controlled substance, and alprazolam (“Xanax”), a Schedule IV controlled substance, in exchange for sex acts.  Arnold was arrested yesterday and will be arraigned this afternoon before United States Magistrate Judge James M. Wicks.

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, Ray Donovan, Special Agent-in-Charge, Drug Enforcement Administration, New York Division (DEA), Peter C. Fitzhugh, Special Agent-in-Charge, Homeland Security Investigations, New York (HSI), and Stuart Cameron, Acting Police Commissioner, Suffolk County Police Department (SCPD), announced the arrest and indictment.

“As alleged, Dr. Arnold abused his position as a dentist and preyed upon vulnerable, drug-addicted women, trading prescriptions for sex acts,” stated Acting U.S. Attorney Kasulis.  “We are committed to vigorous prosecution of medical professionals who abdicate their Hippocratic Oath and contribute to the rise of drug abuse and addiction in our communities."

“With a clear disregard for medical integrity, Dr. Arnold allegedly exchanged prescriptions for sex in his office and home.  This investigation focused on a dentist abusing his position by proliferating drug abuse and endangering the lives and safety of several women,” stated DEA Special Agent-in-Charge Donovan.  “I commend the men and women at the DEA Long Island District Office Tactical Diversion Group, HSI, Suffolk County Police Department Human Trafficking Investigations Unit, Suffolk County Sheriff’s Office and the US Attorney’s Office Eastern District of New York for their expedient and diligent work on this investigation.”

“It’s alleged that Dr. Arnold took advantage of vulnerable, addicted women for his own benefit.  He is ethically and legally responsible for every prescription, but he broke his oath with his alleged misconduct, and he is really no different than a street dealer,” stated HSI Special Agent in Charge Fitzhugh.  “HSI’s continued partnership with the DEA will ensure that drug-dealing dentists are arrested for their criminal acts.”

 “During the course of close to four years, Dr. Arnold used his ability to write prescriptions to take advantage of those struggling with addiction for his own personal indulgences,” stated Acting SCPD Commissioner Cameron. “While this doctor should have held himself to a higher standard, our officers on the DEA’S Long Island Tactical Diversion Squad will continue to hold those in medical practice accountable for illegal actions and I would like to commend the Eastern District of New York for making a difference in the opioid epidemic.”

As set forth in court filings, between October 2016 and August 2020, Dr. Arnold allegedly prescribed oxycodone, Percocet and Xanax to numerous drug-addicted victims in exchange for sex acts.  The sex acts occurred after business hours at his former dental office in Lynbrook and current office in Valley Stream.  Arnold also prescribed controlled substances in exchange for sex acts at his home in Williston Park.  The victims were not Arnold’s dental patients and the prescriptions were not for legitimate medical purposes. 

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

The government’s investigation was led by the DEA’s Long Island Tactical Diversion Squad, which is comprised of agents and officers of the DEA, SCPD, Nassau County Police Department, HHS-OIG and Port Washington Police Department   In addition, HSI, SCPD Human Trafficking Investigations Unit and Suffolk County Sheriff’s Office assisted with the investigation of the case. 

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

The Defendant:

DR. BARRY ARNOLD
Age:  70
Willison Park, New York

E.D.N.Y. Docket No. 21-CR-436 (GRB)

Gary Stein, a licensed chiropractor in Levittown, New York, has paid the United States $290,197.24 to resolve civil allegations that he submitted false claims to the U.S. Department of Labor’s (DOL) Office of Workers’ Compensation Programs (OWCP) for services that he did not provide to a federal employee receiving Federal Employees Compensation Act (FECA) program benefits.  

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, Matthew Modafferi, Special Agent-in-Charge, U.S. Postal Service, Office of the Inspector General (USPS-OIG), Jonathan Mellone, Special Agent-in-Charge, U.S. Department of Labor Office of Inspector General, New York Region (DOL-OIG), and Christopher Godfrey, Director, OWCP, announced the settlement. 

“In billing for medical services he didn’t provide to his patient, the defendant defrauded a taxpayer-funded program designed to assist federal employees who are disabled by on-the-job injuries,” stated Acting U.S. Attorney Kasulis.  “This Office and its law enforcement partners are committed to protecting taxpayer-funded programs from fraud and abuse.”

“The Special Agents of the U.S. Postal Service Office of Inspector General will vigorously investigate those who commit frauds against federal benefit programs and the U.S. Postal Service,” stated USPS-OIG Special Agent-in-Charge Modafferi.  “I’d like to thank the U.S. Attorney’s Office and the Office of Inspector General at the U.S. Department of Labor for their continued support in our agency’s mission.”                 

“Investigating health care fraud offenses against U.S. Department of Labor programs is an important mission of the Office of Inspector General. We will continue to work diligently with our law enforcement partners to hold accountable those who seek to defraud DOL programs and siphon taxpayer funds for personal gain,” stated DOL-OIG Special Agent-in-Charge Mellone.

“This settlement allows OWCP to recover $290,197.24 in medical bill payments under the Federal Employees’ Compensation Act and return those funds to the U.S. Postal Service,” stated OWCP Director Godfrey.  “The Department of Labor’s Office of Inspector General, as well as various other agencies’ offices of inspector general, devote significant investigative resources to detecting cases of possible abuse within the FECA program, and this settlement demonstrates the commitment of the DOL and its OIG in helping to ensure that funds issued through the program are paid appropriately.”

Certain federal employees who become disabled due to occupational injuries sustained during the performance of their official duties qualify for OWCP benefits.  When health care providers bill OWCP for services rendered to FECA beneficiaries, they use Current Procedural Terminology (CPT) codes that specify what services have been provided.  In doing so, they signify that the services were performed as described and properly billed in accordance with accepted industry standards.  Applicable industry standards preclude billing for an extended medical appointment when a FECA beneficiary actually received only a routine service.

An investigation by the DOL-OIG and USPS-OIG revealed that, from March 6, 2014 through April 14, 2019, Stein routinely used CPT codes which falsely indicated to OWCP that he had conducted detailed examinations of the patient when in fact he had not done so. The settlement resolves potential claims that Stein’s alleged conduct violated the False Claims Act. The claims resolved by the settlement are allegations only.

The United States’ case was handled by Assistant U.S. Attorney Jolie Apicella of the Office’s Civil Division with assistance from Civil Investigator Joseph Giambalvo.

BROOKLYN, NY - The Department of Justice announced today that it will begin the process of remitting forfeited funds to FIFA, the world organizing body of soccer; CONCACAF, the confederation responsible for soccer governance in North and Central America, among other regions; CONMEBOL, the confederation responsible for soccer governance in South America; and various constituent national soccer federations (collectively, the “Victims”).  The Department granted a joint petition for remission filed by the Victims, recognizing losses and granting remission up to a total of more than $201 million, of which $32.3 million in forfeited funds has been approved for an initial distribution. In total, well over the amount granted has been seized and has been or is expected to be forfeited to the United States in the Eastern District of New York as part of the government’s long-running investigation and prosecution of corruption in international soccer. 

To date, the prosecutions have resulted in charges against more than 50 individual and corporate defendants from more than 20 countries, primarily in connection with the offer and receipt of bribes and kickbacks paid by sports marketing companies to soccer officials in exchange for the media and marketing rights to various soccer tournaments and events.

This announcement is the beginning of the process for returning funds to the victims of the FIFA bribery scandal and marks the Department’s continued commitment to ensuring justice for those victims harmed by this scheme.

Jacquelyn M. Kasulis, Acting 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 L. Korner, Special Agent-in-Charge, Internal Revenue Service-Criminal Investigation, made the announcement.

“Today’s announcement confirms that money stolen by corrupt soccer officials and sports marketing executives through fraud and greed will be returned to where it belongs and used to benefit the sport,” stated Acting United States Attorney Kasulis.  “From the start, this investigation and prosecution have been focused on bringing wrongdoers to justice and restoring ill-gotten gains to those who work for the benefit of the beautiful game.  Our Office, together with our law enforcement partners, will always work to compensate victims of crime.”

“The approval of this remission of funds illegally obtained in the FIFA scandal marks another important milestone in these prosecutions and the department’s commitment to use all tools at its disposal to prosecute corruption and to deprive perpetrators of ill-gotten gains,” stated Assistant Attorney General Polite. “This remission highlights the importance of asset forfeiture as a critical tool for the recovery of criminal proceeds and the pursuit of justice.”

“Kickbacks and bribes have a way of spreading like a disease through corrupt groups; pure and simple greed keeps the graft going.  Not one official in this investigation seemed to care about the damage being done to a sport that millions around the world revere.  The only silver lining is the money will now help underprivileged people who need it, not the wealthy executives who just wanted it to get richer.  Our work isn’t finished, and our promise to those who love the game – we won’t give up until everyone sees justice for what they’ve done,” stated FBI Assistant Director-in-Charge Driscoll.

“For years, corrupt soccer officials and greedy sports marketing executives engaged in dozens of multimillion-dollar bribe and kickback schemes,” said Special Agent-in-Charge Ryan L. Korner of the IRS-Criminal Investigation (IRS-CI).  “These individuals and companies lined their pockets with millions that were supposed to be used for the development and betterment of soccer worldwide. Agents with IRS-CI and their partners at the U.S. Attorney’s Office and the FBI relentlessly pursued this corruption and seized these ill-gotten gains.  Now these funds can be used as they were intended, to promote and develop the world’s most popular game.”

On May 27, 2015, an indictment was unsealed charging 14 FIFA officials and sports marketing executives with racketeering, honest services wire fraud and money laundering offenses, among others.  On December 3, 2015, a superseding indictment was unsealed charging an additional 16 FIFA officials with similar crimes.  Additional defendants were later charged by indictment and information.  During the course of the prosecutions to date, 26 individual defendants have pleaded guilty for their roles in the charged crimes.  In December 2017, two former FIFA officials, Juan Ángel Napout of Paraguay and José Maria Marin of Brazil, were convicted after trial of racketeering conspiracy and related offenses.  Four corporate entities have pleaded guilty and others, including banking institutions, have acknowledged their roles in criminal conduct through deferred prosecution or non-prosecution agreements.  The government’s prosecutions and investigation are ongoing.

As part of these proceedings, many of the defendants were ordered to forfeit assets obtained through their criminal activity.  Under federal law, the Department of Justice has the authority to distribute the proceeds of forfeited assets through the remission process to victims of crimes, including to the soccer organizations that employed and were defrauded by the corrupt soccer executives. 

FIFA, CONCACAF and CONMEBOL have committed to distributing funds received through the remission process to and through a newly created World Football Remission Fund (the “Fund”), to be established under the FIFA Foundation, an independent foundation focused on youth programs, community outreach and humanitarian needs.  The terms of the Fund provide for oversight and independent audit measures to ensure remitted funds are distributed appropriately.   

The government’s case is being handled by the Office’s FIFA Task Force.  Assistant U.S. Attorneys Samuel P. Nitze, M. Kristin Mace, Keith D. Edelman, Brian D. Morris, and Kaitlin T. Farrell are in charge of the prosecution and coordination of the victim remission process.  The Justice Department, through the Asset Forfeiture Program, works diligently to restore lost funds to victims of crime.  The victim compensation payments in the FIFA case would not have been possible without the extraordinary efforts of the U.S. Department of Justice Criminal Division’s Money Laundering and Asset Recovery Section, the FBI’s New York Field Office and the IRS-CI.

A complaint was unsealed today in federal court in Brooklyn charging David Motovich, principal of a lumber and construction materials business, with bank fraud, aggravated identity theft and witness tampering.  Motovich was arrested this morning and will make his initial appearance before United States Magistrate Judge Roanne L. Mann this afternoon. 

Jacquelyn M. Kasulis, Acting 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, Acting Special Agent-in-Charge, Internal Revenue Service-Criminal Investigation (IRS-CI), announced the arrest and charges.

“As alleged, the defendant used a seemingly legitimate, family-run business as a front for engaging in a $55 million check cashing scheme that deliberately flouted federal banking and anti-money laundering laws.  Further, as law enforcement was closing in on his schemes, Motovich attempted to derail the government's investigation by tampering with witnesses,” stated Acting U.S. Attorney Kasulis.  “Today's arrest demonstrates that this Office will take down and vigorously prosecute defendants like Motovich, who circumvent compliance with federal financial laws out of greed, just to line his own pockets and live a life of luxury.”  Ms. Kasulis also expressed her appreciation to the U.S. Attorney’s Office for the District of New Jersey for their assistance with the case.

“Federal banking laws exist to protect the industry from fraud and the general public from money laundering schemes that often further criminal activity. Motovich, as alleged, broke these laws in order to advance his own monetary interests,” stated FBI Assistant Director-in-Charge Driscoll.  “To make matters worse, he’s also accused of tampering with government witnesses.  Rest assured this type of illegal behavior will be aggressively pursued by the FBI and our partners.”

“The multiple schemes Mr. Motovich allegedly devised has great impact on both his clients and the United States treasury,” stated IRS-CI Acting Special Agent-in-Charge Fattorusso.  “In our current environment, the services provided by federal and local governments are sorely needed.  The allegations in this complaint require the financial expertise IRS-CI provides in order to unravel the complexities of such crimes.”

As alleged in the complaint, since at least 2012, Motovich has operated an illegal check cashing business from his office at his family-run lumber business located in the Midwood section of Brooklyn.  The customers of Motovich’s illegal check cashing business are primarily the owners and operators of construction companies who pay their employees in cash to avoid having to pay state and federal employment taxes, including taxes owed under the Federal Income Contributions Act.  As part of the scheme, Motovich cashed millions of dollars of checks for his customers in exchange for a fee or a percentage of the face amount of the checks, ranging between four and 10 percent.  Motovich’s customers paid a higher fee to Motovich than the fees charged by licensed check cashing businesses because the customers understood that Motovich would not file Currency Transaction Reports for cash transactions in amounts greater than $10,000 or Suspicious Activity Reports, as required by federal anti-money laundering statutes.  Motovich supplied his check cashing customers with fraudulent documents that they could use to disguise the transactions as payments by the customers for materials and/or subcontracting work if the customers were audited by the New York State Workers Compensation Board or tax authorities.      

In furtherance of his scheme, Motovich created shell companies for the sole purpose of facilitating his illegal check cashing business and instructed his customers to issue checks drawn against their business accounts and make the checks payable to one of the companies.  Motovich then deposited the checks into bank accounts that he created at several financial institutions.  To conceal his control and ownership of the funds in the accounts, and to avoid detection of his scheme, Motovich opened the accounts in the names of other individuals.

In total, between 2012 and 2019, Motovich deposited more than $55 million into the accounts that he had opened in the names of other individuals and used the funds to purchase real estate; pay personal and corporate credit card accounts; purchase luxury items, including millions of dollars of diamonds, watches, jewelry and clothing; make lease and purchase payments for Porsche and Lexus luxury vehicles; pay premiums on multi-million dollar life insurance policies for himself, his wife and others; make renovations to his penthouse apartment; and to fund other business ventures.

When Motovich became aware of the government’s investigation, he tampered with witnesses by encouraging them not to cooperate with the government, including encouraging them to fire their attorneys and retain attorneys that he had handpicked for them, and by paying at least one witness and that witness’s family members so that the witness would not cooperate with law enforcement.  

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

The government’s case is being handled by the Office’s Public Integrity Section.  Assistant United States Attorneys Robert Polemeni, Erik Paulsen and Kaitlin T. Farrell are in charge of the prosecution, with assistance from EDNY Special Agents George Dietz and Martin Sullivan.

The Defendant

DAVID MOTOVICH
Age:  46
New York, New York

E.D.N.Y. Docket No. 21-MJ-979

Earlier today, in federal court in Brooklyn, Reynaldo Vasquez, the former president of the El Salvadorean soccer federation (the “Federation”), pleaded guilty to racketeering conspiracy in connection with his participation in schemes to accept hundreds of thousands of dollars in bribes and kickbacks.  Part of the money Vasquez received was wired through a U.S. bank account.  Vasquez also agreed to forfeit $360,000 and multiple bank accounts.  When sentenced, Vasquez faces a maximum sentence of 20 years in prison.  Today’s plea proceeding took place via videoconference before United States District Judge Pamela K. Chen.

Jacquelyn M. Kasulis, Acting 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 Ryan L. Korner, Special Agent-in-Charge, Internal Revenue Service-Criminal Investigation, Los Angeles (IRS-CI), announced the guilty plea. 

“With today’s guilty plea, Vasquez admits to engaging in a decades-long racketeering conspiracy to accept hundreds of thousands of dollars in bribes and kickbacks that corrupted the game of soccer,” stated Acting United States Attorney Kasulis.  “Together with our law enforcement partners, this Office is committed to rooting out fraud and corruption in international soccer and to protecting the integrity of the U.S. financial system.”

“From the beginning of this intense and sprawling investigation, our goal has been to root out corrupt officials who thought no one noticed their illegal activities,” stated FBI Assistant Director-in-Charge Driscoll.  “Mr. Vasquez didn’t achieve his dream of wealth and power, and now he faces the possibility of many years in federal prison.  Today's plea should demonstrate to others who attempt to corrupt international soccer - we play to win.”    

“Today’s guilty plea is the culmination of years of investigative work by IRS-CI Agents and their law enforcement partners,” stated IRS-CI Special Agent-in-Charge Korner.  “Over a period of many years, Reynaldo Vasquez corrupted the business of international soccer by requesting hundreds of thousands of dollars in bribes and kickbacks.  IRS CI is committed to ending these practices and bringing corrupt officials to justice.”

According to court filings and facts presented during the plea proceeding, Vasquez and his co-conspirators participated in and corrupted an enterprise comprising soccer organizing bodies and sports marketing companies.  As part of his association with that enterprise, Vasquez and others solicited and received bribes and kickbacks in exchange for awarding lucrative media and marketing contracts.  In 2012, Vasquez, together with other current and former officials of the federation, received approximately $350,000 in bribes in connection with the sale of media and marketing rights to El Salvador World Cup qualifying matches to be played in advance of the 2018 World Cup.  This bribe payment was wired from a sports marketing company’s bank account in the United States.  Vasquez ultimately received a portion of his bribe money through a wire transfer sent through the United States.  In 2014 and 2015, Vasquez and others agreed to receive tens of thousands of dollars in bribes in connection with the participation of the Salvadorean national team in friendly matches to be played in the United States.  Vasquez was extradited from El Salvador to the United States on January 29, 2021.

The guilty plea announced today is part of a long-running investigation into corruption in international soccer led by the U.S. Attorney’s Office for the Eastern District of New York, the FBI New York Field Office, and the IRS-CI Los Angeles Field Office.  To date, the prosecution has resulted in 27 individual guilty pleas, 4 corporate guilty pleas, and 2 convictions at trial, among other resolutions.  The prosecutors in Brooklyn have received considerable assistance from attorneys in various parts of the Justice Department’s Criminal Division in Washington, D.C., including the Office of International Affairs, the Organized Crime and Gang Section, the Money Laundering and Asset Recovery Section, and the Fraud Section, as well as from INTERPOL Washington. 

Assistant U.S. Attorneys Samuel P. Nitze, Keith D. Edelman, Kaitlin T. Farrell, Patrick T. Hein, Victor Zapana and Brian D. Morris of the Eastern District of New York are in charge of the prosecution.   

Defendant:

REYNALDO VASQUEZ
Age: 65
El Salvador

E.D.N.Y. Docket No. 15-CR-252 (S-3) (PKC)

Earlier today, a federal jury in Brooklyn convicted Bernard Raymond Augustine, a U.S. citizen and California resident, of attempting to provide material support to a designated foreign terrorist organization, the Islamic State of Iraq and al-Sham (“ISIS” or “the Islamic State”).  The verdict followed a one-week trial before United States District Judge Sterling Johnson, Jr.  When sentenced, Augustine faces up to 20 years in prison.

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, Mark J. Lesko, Acting 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 Dermot F. Shea, Commissioner, New York City Police Department (NYPD), announced the verdict.

“The defendant’s unvarnished testimony at trial demonstrates his ongoing support for ISIS and its glorification of barbaric acts of terrorism, including attacks on U.S. soldiers, the enslavement of Yazidi women and mass killings, which he described as ‘cool,’” stated Acting U.S. Attorney Kasulis.  “Today’s guilty verdict underscores the strong commitment of this Office and its law enforcement partners to combatting terrorism and protecting the United States from potentially dangerous threats to its national security.”

The evidence at trial established that in February 2016, the defendant traveled from San Francisco, California to Northern Africa, with the goal of joining ISIS, a designated foreign terrorist organization.  In the months leading up to his travel, the defendant watched ISIS propaganda, including videos glorifying ISIS’s violence, such as “The Flames of War.”  The defendant 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 on the internet.  He posted statements 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.” 

Augustine then purchased a one-way airplane ticket and traveled to Tunisia so that he could present himself as a willing participant in ISIS’s terrorist activity.  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 subsequently returned to the United States in 2018, where he was brought to the Eastern District of New York for prosecution. 

Augustine represented himself at trial with the assistance of standby counsel.  The defendant took the witness stand in his own defense and his testimony included the following statements:

• “I just want to tell the jury that I do not regret my decision, I’m proud of my decision and if I could go back and start over I would do it again, and if I became a free man tomorrow I would do it again, I would leave and I would do that again.  I have no regrets about it and I’m proud of it.  And I believe that all Muslims must immigrate to the Islamic State upon its establishment, especially ones living in the west.”

• Augustine testified that he was aware that Islamic State fighters slaughtered members of the Yazidi ethnic group, and that he understood that the Islamic State enslaved Yazidi women.  
• Augustine described the Islamic State propaganda film “Flames of War,” which he acknowledged contains mass killings, as “a really cool video.  You should watch the whole thing.”
• Augustine testified that Islamic State propaganda showing holy warriors fighting and engaging in martyrdom and suicide bombings was “cool” and “hell, yeah, it was cool.”

 he 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 Attorneys Phil Viti and George Kraehe of the Counterterrorism Section of the Department of Justice.  The Justice Department’s Office of International Affairs provided assistance.

The Defendant:

BERNARD RAYMOND AUGUSTINE
Age: 25
Keyes, California

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

Earlier today, in federal court in Brooklyn, Eduard Florea pleaded guilty before United States Chief Magistrate Judge Cheryl L. Pollak to one count of transmitting threats to injure and one count of possessing ammunition after having been convicted of a felony.  When sentenced, Florea faces up to 15 years in prison.

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, and Jacqueline Maguire, Acting Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the guilty plea.

“With today’s guilty plea, Florea admits to threatening the life of a successful candidate for the U.S. Senate and to urging others to take up arms to unleash violence at the Capitol on January 6, 2021 to thwart the results of the Presidential election.” stated Acting U.S. Attorney Kasulis. “This Office is deeply committed to protecting our democratic institutions and to using all available tools to preserve the public safety, uphold the rule of law and support the peaceful transfer of power.”

As set forth in the court filings and today’s proceeding, Florea posted threatening statements online about killing elected officials, including now-United States Senator Raphael Warnock and committing other acts of violence in Washington, D.C. in connection with the certification of the results of the 2020 Presidential Election.  For example, on January 5, 2021, at approximately 8:40 p.m., Florea posted, “We need to all come to an agreement . . . and go armed . . . and really take back Washington.” A few minutes later, Florea posted, “Tomorrow may very [well] be the day war kicks off . . .”  At 11:53 p.m. the same day, Florea posted, “Warnock is going to have a hard time casting votes for communist policies when he’s swinging with the f***ing fish.”  In the early morning hours of January 6, 2021, at approximately 12:42 a.m., Florea referenced Senator Warnock and stated, “Dead men can’t pass sh*t laws . . .”

On January 6, 2021, after the assault on the United States Capitol had begun, Florea posted that he intended to travel to Washington, D.C. as part of a group armed with firearms ready to engage in additional violence.  Between approximately 2:00 p.m. and 6:00 p.m.—while the Capitol was under siege—Florea posted the following messages, among others:

• “Mine are ready….I am ready…. we need to regroup outside of DC and attack from all sides… talking to some other guys….I will keep watching for the signal.”

• “I am awaiting my orders…armed and ready to deploy….”

• “Guns cleaned loaded . . . got a bunch of guys all armed and ready to deploy . . . we are just waiting for the word”

• “There 3 car full of armed patriots heading in from NY….”

• “Me and some guys are gearing up to head in. . . . where are you . . . 3 cars already are enroute . . . .all armed.”

• “It’s time to unleash some violence.”

On January 12, 2021, FBI Special Agents and Task Force Officers with the New York Joint Terrorism Task Force executed a search warrant at Florea’s home in Middle Village, Queens.  The search revealed that Florea, who had been previously convicted of a New York state firearms-related felony, illegally possessed more than 1,000 rounds of ammunition.

The government’s case is being handled by the Office’s National Security and Cybercrime Section.  Assistant United States Attorneys Francisco J. Navarro and Andrew P. Wenzel are in charge of the prosecution.

The Defendant:

EDUARD FLOREA
Age: 41
Queens, New York

E.D.N.Y. Docket No. 21-CR-037 (EK)

A five-count indictment was filed yesterday in federal court in Brooklyn charging Roman Nikoghosyan, a member of a violent, Brooklyn-based Eurasian organized crime syndicate that operated primarily in the Manhattan Beach and Brighton Beach neighborhoods, with two counts of Hobbs Act extortion conspiracy, one count of Hobbs Act extortion, interstate transportation of stolen property and being a convicted felon in possession of a firearm.  Nikoghosyan was arrested in Los Angeles, California on July 20, 2021 and ordered detained pending trial.  He will be arraigned in the Eastern District of New York at a later date.

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, Jacqueline Maguire, Acting Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Dermot F. Shea, Commissioner, New York City Police Department (NYPD), announced the indictment.

“As alleged, the defendant is an extortionist who uses threats of violence and intimidation to coerce his victims into making extortionate payments to him for refusing to participate in his life of crime, which also includes illegally possessing a Hi-point 995 rifle despite his having a prior felony conviction,” stated Acting United States Attorney Kasulis.  “Together with our law enforcement partners, this Office is working tirelessly to dismantle violent criminal organizations like KavKaz that threaten the safety of communities in the Eastern District.”  Ms. Kasulis thanked the FBI and NYPD for their contributions to date in the investigation. 

“Crime syndicates thrive on creating a deep fear in the communities where they operate, and members of these syndicates instill this fear through a range of criminal tactics to include violence, extortion, and narcotics trafficking,” stated FBI Assistant Director-in-Charge Maguire.  “Forcing someone against their will to transport drugs through threats of violence, as alleged done by the defendant, is criminal behavior.  Our FBI Eurasian Organized Crime Task Force, together with our NYPD partners, have made great strides in ridding local neighborhoods of these violent offenders, and we won’t stop our pursuit of them until they are stopped.”

“The NYPD remains vigilant in its work to prevent the violence so often associated with gangs and crews that tear at the fabric of life in New York.  I commend our NYPD investigators, federal partners and prosecutors in the United States Attorney’s Office in the Eastern District of New York for their relentless work in this case,” stated NYPD Commissioner Shea.

As set forth in court filings, KavKaz is a criminal enterprise that operates in the Eastern District of New York and elsewhere, with Brooklyn as its largest base of operation.  Members of KavKaz refer to their membership as the “KWAY” or “K WAY,” and often wear jewelry or articles of clothing emblazoned with the word “KavKaz.”  Brooklyn-based members of KavKaz draw on ties to the Caucus region of Eurasia, namely Armenia, Uzbekistan, parts of Southern Russia and Azerbaijan, in furtherance of accomplishing their criminal goals, including extortion and narcotics trafficking.  

In early 2021, Nikoghosyan was operating a narcotics distribution scheme in which he employed the victim of one of his extortionate schemes to transport packages containing marijuana.  When the victim discovered the illicit content of the packages and refused to continue distributing the narcotics, Nikoghosyan, with the assistance of coconspirators, demanded $10,000 in extortionate payments from the victim, threatening to stab him or break his legs if he did not comply.

In addition, Nikoghosyan and co-conspirators plotted to transport luxury vehicles acquired by fraud from California to New York.  Finally, Nikoghosyan, having been previously convicted of a felony, was charged with possessing a firearm, a Hi-point 995 rifle found during the execution of a search warrant on July 20, 2021 at a stash house in Brooklyn that was allegedly used by Nikoghosyan.  During that search, law enforcement also recovered ammunition and a quantity of marijuana.

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

The government’s case is being handled by the Office’s Organized Crime and Gangs Section.  Assistant United States Attorneys Matthew Galeotti and Dana Rehnquist are in charge of the prosecution. 

The Defendants:

ROMAN NIKOGHOSYAN
Age:  32
Brooklyn, New York

E.D.N.Y. Docket No. 21-cr-421 (RJD)

Earlier today, in federal court in Brooklyn, Humberto Baez, a produce importer based in Pennsylvania, was sentenced by United States District Judge Allyne R. Ross to 13 years’ imprisonment for conspiring to import and distribute cocaine, and for possessing with intent to distribute cocaine.  Baez was convicted by a jury in February 2019 following a two-week trial before the late United States District Judge Jack B. Weinstein.

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, Ray Donovan, Special Agent-in-Charge, Drug Enforcement Administration, New York Division (DEA), Peter C. Fitzhugh, Special Agent-in-Charge, Homeland Security Investigations, New York (HSI), and Dermot F. Shea, Commissioner, New York City Police Department (NYPD), announced the sentence.

“Today’s sentence demonstrates that this Office and its law enforcement partners are committed to stopping the flow of dangerous drugs into this country and to bringing drug traffickers like Baez to justice,” stated Acting United States Attorney Kasulis.  Ms. Kasulis expressed her grateful appreciation to the New York Organized Crime Drug Enforcement Strike Force for their work on the long-term investigation, the DEA’s Santo Domingo Country Office (SDCO) and the Sensitive Investigative Unit (SIU) for their assistance.

“Concealing drug shipments with produce is one way drug traffickers try to elude law enforcement.  This cat and mouse game evolves over time resulting in law enforcement recovering drugs in various places; such as inside coconuts, wheelchairs, animals, people, tombstones, etc. just to name a few.   I applaud the members of the New York Strike Force and the U.S. Attorney’s Office Eastern District of New York for their dedicated work throughout this investigation,” stated DEA Special Agent-in-Charge Donovan.

“By conspiring to import cocaine hidden in a carton of chili peppers, Humberto Baez was fueling a violent trade that victimizes New Yorkers.  His conviction and sentencing today sends a clear message that the NYPD and our law enforcement partners will stop at nothing to track these kinds of schemes and protect the public from the impact of illegal narcotics,” stated NYPD Commissioner Shea.

Between August 2016 and March 2018, Baez conspired with others to import cocaine hidden inside a shipping container into the United States.  Baez had contacted an importing company to use as a front to transport cocaine from Baez’s source of supply in the Dominican Republic.  Baez and his co-conspirators then arranged for two “dry run” shipments containing only produce into the Red Hook Terminal in Brooklyn to establish the appearance of a legitimate business relationship between the exporter and importer, thereby avoiding scrutiny when subsequently shipping cocaine.  In late February 2018, a third shipment arrived in Miami, Florida with approximately 16 kilograms of cocaine concealed in the flaps of cardboard boxes containing chili peppers.  Baez relayed information that a third shipment contained “ripe tomatoes,” using agreed upon code words for cocaine that would be transported by truck to Baez’s warehouse in Pennsylvania.  On March 1, 2018, members of law enforcement searched the container and seized the hidden cocaine. 

The Strike Force is a crime-fighting unit comprising federal, state and local law enforcement agencies supported by the New York/New Jersey High Intensity Drug Trafficking Area.  It is housed at the DEA’s New York Division and includes agents and officers of the DEA; the NYPD; the New York State Police; HSI; the U.S. Internal Revenue Service Criminal Investigation Division; the Bureau of Alcohol, Tobacco, Firearms and Explosives; U.S. Customs and Border Protection; U.S. Secret Service; the U.S. Marshals Service; New York National Guard; the Clarkstown Police Department; U.S. Coast Guard; Port Washington Police Department; and New York State Department of Corrections and Community Supervision.

The government’s case is being handled by the Office’s International Narcotics and Money Laundering Section.  Assistant United States Attorneys Nomi D. Berenson and Erin M. Reid are in charge of the prosecution.

The Defendant:

HUMBERTO BAEZ
Age:  52
Lancaster, Pennsylvania

E.D.N.Y. Docket No. 18-CR-168 (S-1) (ARR)

A 14-count indictment was unsealed yesterday in federal court in Brooklyn charging seven defendants with participating in a counterfeit goods scheme in which they imported generic goods into the United States from China, applied brand labels to those goods in workshops, some of which were controlled by the defendants, and then sold those counterfeit-branded goods to retail and wholesale purchasers.  The charges against the defendants include conspiracy to traffic and trafficking in counterfeit goods and money laundering.  Four defendants were arraigned yesterday before United States Magistrate Judge Sanket J. Bulsara and each was released on a $200,000 bond.  Three additional defendants remain at large.

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, Peter C. Fitzhugh, Special Agent-in-Charge, Homeland Security Investigations, New York (HSI), and Dermot Shea, Commissioner, New York City Police Department (NYPD), announced the arrests and indictment.

“As alleged, the defendants trafficked in counterfeit merchandise that they fraudulently branded as genuine to pass off to purchasers in the United States at a purported retail value of more than $130 million,” stated Acting United States Attorney Kasulis.  “This Office and its law enforcement partners are committed to protecting consumers from paying retail prices for phony merchandise and to holding defendants accountable for their greed.”  Ms. Kasulis extended her grateful appreciation to the HSI Intellectual Property Group, the HSI Border Enforcement Security Task Force and the NYPD.  Ms. Kasulis also extended her thanks to U.S. Customs and Border Protection for its assistance.

“HSI New York’s Border Enforcement Security Taskforce stands at the forefront of the fight against criminal organizations who identify weaknesses in our supply chain and infiltrate them for their personal financial gain,” stated HSI Special Agent-in-Charge Fitzhugh.  “In addition to their detrimental effect to our economy, counterfeiting networks such as this one poses a threat to our national security and public safety by introducing products that often contain harmful materials and substances.  HSI and CBP are uniquely positioned to combat these organizations and, along with our partners at the New York City Police Department, will work tirelessly to protect New York City and the Homeland.”

As alleged in the indictment, between October 2019 and July 2021, the defendants participated in an international scheme to traffic counterfeit goods.  The defendants first imported the goods in generic form from China into the Port of New York and New Jersey.  The goods were then delivered to workshops and storage facilities controlled by some of the defendants in Queens and on Long Island.  In those workshops, insignias, emblems, trademarks and other brand signifiers were applied to the generic goods, converting them into purported brand name merchandise.  These counterfeit goods were then sold as a part of the scheme directly to consumers and to wholesale buyers.   The estimated retail value of the counterfeit-branded goods, had they been genuine, was in excess of $130 million. 

The government’s case is being handled by the Office’s General Crimes Section. Assistant United States Attorneys Dylan A. Stern and Benjamin L. Weintraub are in charge of the prosecution.  Assistant United States Attorney Tanisha Payne of the Office’s Asset Recovery Section is handling forfeiture matters in the case. 

The Defendants:

HAI LONG ZHOU (also known as “Zangkun Zhou”)
Age:  53
Queens, New York

SAIYIN HOU
Age:  25
Brooklyn, New York

YAN XUE HUANG (also known as “Yan Xue Zhou” and “Yan Xue Li Ming”)
Age:  50
Queens, New York

JIAN FEN YANG
Age:  57
Queens, New York

E.D.N.Y. Docket No. 21-CR-417 (SJ)

Former Suffolk County District Attorney Thomas J. Spota and Christopher McPartland, the former Chief of Investigations and Chief of the Government Corruption Bureau of the Suffolk County District Attorney’s Office (SCDAO), were each sentenced today by United States District Judge Joan M. Azrack, to five years in prison.  Additionally, Spota was ordered to pay a $100,000 fine. 

The sentences stem from the defendants’ December 17, 2019 convictions, following a six-week federal jury trial, on all four counts of the Indictment; specifically, of conspiracy to tamper with witnesses and obstruct an official proceeding, witness tampering, obstruction of justice, and being accessories after-the-fact to former Suffolk County Police Department (SCPD) Chief of Department James Burke’s deprivation of a prisoner’s civil rights.

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, and Jacqueline Maguire, Acting Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the sentences.

“When a sitting District Attorney and one of his top prosecutors are corrupt and use their power to intimidate witnesses and cover up a brutal assault by a high-ranking law enforcement official, they not only jeopardize the safety of citizens who are entitled to the protection of the law, they also undermine confidence in the integrity and fairness of our criminal justice system,” stated Acting U.S. Attorney Kasulis.  “Instead of serving the people of Suffolk County, these defendants brazenly abused their exceptional positions of power and public trust to protect their friends and hurt their enemies.  With today’s sentences, justice has been served and the defendants have learned the consequences of their crimes, just like anyone else who has broken the law.  I commend the tenacity and skill of this Office's prosecutors and the FBI special agents in toppling the defendants from their undeserved positions of prominence and in holding them to account for their reprehensible violations of the public trust.”

“With great power comes great responsibility – and, as we’ve proven throughout the course of this investigation, Mr. Spota and Mr. McPartland abused their power to skirt their responsibility to comply with a federal civil rights investigation.  They placed fear of retaliation inside the minds of those who may otherwise have been willing to cooperate, and they interfered with efforts of federal investigators who were trying to get to the bottom of a heinous crime.  Their behavior was outrageous, and their sentences today prove as much.  There is absolutely no place for this type of behavior within our criminal justice system.  Those who abuse their power and subject others to cruel and unnecessary punishment must be removed from serving in any official capacity and must pay the price for their conduct.  Only then, and with today's sentences, the earned trust and confidence of the citizens of Suffolk County can be justly restored, stated FBI Acting Assistant Director-in-Charge Maguire.

In December 2012, then-Chief of the SCPD, James Burke – the highest-ranking uniformed police official in Suffolk County – physically and verbally assaulted a shackled prisoner, Christopher Loeb, who was under arrest and being held in an interrogation room at the 4th Precinct in Hauppauge, New York.  Loeb had broken into Burke’s official police vehicle and stolen his gun belt and ammunition, and a duffel bag containing cigars, sex toys, prescription Viagra and pornography.  After the assault, Burke ordered high-ranking lieutenants of the SCPD to ensure that the detectives and officers who had witnessed the assault would never reveal what they had observed.  Burke also enlisted the help of his long-time mentor, then-District Attorney Spota, and McPartland, his personal friend and then-Chief of both Investigations and the Government Corruption Bureau, to ensure that the witnesses kept quiet.  Having served as the Suffolk County D.A. for over a decade, Spota had successfully helped Burke avoid legal trouble regularly during their decades-long friendship.  McPartland, who worked directly under Spota, also had built a close friendship with Burke, and was the first person who Burke called the morning he discovered that his vehicle had been burglarized.    

A federal grand jury investigation into the Loeb assault as a civil rights deprivation was opened by the U.S. Attorney’s Brooklyn Office, with the assistance of the FBI, in the spring of 2013.  Burke, Spota and McPartland used the power and influence of their official positions, and the threat of retaliatory arrest and prosecution, to keep anyone from cooperating with that investigation.  Because of their obstructive efforts, the federal investigation was unsuccessful and was closed approximately eight months later.  Local law enforcement eyewitnesses had been frightened into silence, as they feared retaliation against themselves and their families from within the Suffolk County Police Department and the District Attorney’s Office.  Approximately one year later, prosecutors from U.S. Attorney’s Long Island Criminal Division reopened the investigation.  As certain key witnesses were then compelled to testify before the grand jury under a grant of immunity, the truth about Burke assaulting Loeb finally emerged. 

Burke pleaded guilty to a civil rights violation and conspiracy to obstruct justice in February 2016 and was sentenced to 46 months’ imprisonment.  Spota and McPartland both resigned from the District Attorney’s Office in light of the charges against them and have since been disbarred.

The government’s case is being handled by the Office’s Long Island Criminal Division.  Assistant United States Attorneys Nicole Boeckmann, Lara Treinis Gatz, Justina L. Geraci and Michael R. Maffei are in charge of the prosecution.

The Defendants:

THOMAS J. SPOTA
Age:  79                     
Mount Sinai, New York

CHRISTOPHER McPARTLAND   
Age:  55         
Northport, New York

E.D.N.Y. Docket No. 17-CR-587 (JMA)

A 20-count superseding indictment was unsealed today in federal court in Brooklyn charging Oluwagbenga Agoro, Lorenzo Bailey, Quincy Battice, Davon Brown, Hans Destine, Jean Fremont, Ricardo Hepburn, McKoy Lima, Triston Lawrence, Deryck Thompson and Michael Williams with violent crimes in-aid-of racketeering — including attempted murder and related firearms offenses.  As alleged in the indictment, the defendants are members and associates of the Folk Nation Gangster Disciples, also known as “GD.” Bailey, Destine, Fremont, and Thompson are leaders of the No Love City (“NLC”) subset of GD, with Destine and Fremont serving on NLC’s five-member “Steering Committee” — its top leadership.  Additionally, during the execution of search warrants this morning, investigators recovered three firearms at Destine’s residence, one firearm at Lawrence’s residence, one from Thompson’s residence and one from Bailey’s residence in Georgia.

Destine, Fremont, Hepburn, Lawrence, Lima, Thompson and Williams were arrested this morning in Brooklyn and are scheduled to be arraigned this afternoon before United States Magistrate Judge Sanket J. Bulsara.  Bailey and Battice were arrested this morning in Atlanta, Georgia, and are scheduled to be arraigned this afternoon before United States Magistrate Judge Catherine M. Salinas at the federal courthouse in Atlanta.  Agoro and Brown were already in federal custody on prior charges and will be arraigned at a later date. 

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, Jacqueline Maguire, Acting Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), Eric Gonzalez, District Attorney, Kings County District Attorney’s Office (KCDA), and Dermot F. Shea, Commissioner, New York City Police Department (NYPD), announced the arrests and charges.

“As the indictment makes clear, violent street gangs like the Folk Nation Gangster Disciples can commit a shocking amount of violence and inflict a tremendous amount of harm, which endangers entire communities if left unchecked,” stated Acting United States Attorney Kasulis.  “This Office and its federal, state and local law enforcement partners will spare no effort in targeting and prosecuting violent individuals and street gangs that intentionally wreak havoc in our communities by possessing and wantonly discharging loaded weapons with no regard for human life.  Street gangs in Brooklyn should be on notice that we will use every resource available to rid our communities of this needless violence.”  Ms. Kasulis expressed her grateful appreciation to the FBI/NYPD Metro Safe Streets Task Force, the NYPD’s Gun Violence Suppression Division, and the Kings County District Attorney’s Office for their outstanding work and assistance in this investigation and prosecution.

“Two gang takedowns over the past two days demonstrates our commitment to pursue the violent criminals who choose to terrorize our communities,” stated FBI Acting Assistant Director-in-Charge Maguire.  “The litany of crimes we allege in this case is demonstrative of the fear and frustration facing far too many New York City communities.  Our work through the FBI/NYPD Metro Safe Streets Task Force will continue relentlessly until residents can feel safe again.”

“This important takedown is part of our multi-pronged and ongoing strategy of focusing on the most violent offenders in our community, who are largely responsible for the surge in shootings we experienced last summer. With today’s arrests, leaders of a dangerous street gang have been incapacitated, which I believe will have a positive impact on public safety in Brooklyn. I’m grateful to the U.S. Attorney’s Office, the FBI, the NYPD and my prosecutors for their outstanding work on this investigation. We will continue to work together in partnership and use every law enforcement resource available to us to help drive down gun and gang violence,” stated KCDA Gonzalez.

“Targeting and dismantling gangs and crews, and preventing the violence so often associated with their illegal activities, continues to be among the highest priorities for the NYPD and our law enforcement partners. We remain relentless in our efforts to identify, arrest, and prosecute anyone who involves themselves in violence on our streets,” stated NYPD Commissioner Shea.

As alleged in the indictment and other court filings, the charges relate to seven non-fatal shootings committed in Brooklyn over the course of 2020 in which six individuals were wounded.

The March 14, 2020 Shooting

As alleged, on March 14, 2020, Brown was involved in the shooting of a victim for perceived disrespect towards GD.  An individual with the victim threw a drink inside the Gold Room Restaurant and Lounge in Prospect Lefferts Gardens, splashing a person standing with Brown.  An argument ensued, and the victim, a Crips gang member, flashed a gang sign known as “dropping the rake” — a gesture intended to be insulting to GD.  The argument continued outside the bar where Brown displayed a gun and fired a shot into the air.  Brown then handed the gun to a coconspirator who walked behind the victim and shot the victim in the buttocks at close range.  The gun was recovered by law enforcement and Brown’s DNA was found on the weapon. 

The July 24, 2020 Shooting

As alleged, on July 24, 2020, Michael Williams was involved in the shooting of two individuals in Prospect Park South.  On the previous evening, a member of GD had been shot and Williams and others took him to the hospital.  After leaving the hospital, Williams and other members of GD retaliated against the Crips gang by driving to an area of Brooklyn they believed to be Crip territory where Williams and another gunman opened fire into a crowd of people, wounding two victims in the knee and chest.   

The August 2, 2020 Shooting

On August 2, 2020, Lawrence allegedly shot at a Crips gang member in Prospect Lefferts Gardens.  Prior to the shooting, the intended target of the shooting had been walking through a part of Prospect Lefferts Gardens known as GD territory while broadcasting himself on Instagram Live mocking GD.  Immediately after the shooting, Lawrence sent an encrypted message to Brown using the Telegram encrypted application stating that he had just “boomed at” the intended target. 

The November 2020 Shootings

As alleged, on November 7 and 9, 2020, Agoro, Bailey, Battice, Destine, Fremont, Hepburn, Lima and Thompson engaged in four separate drive-by shootings in Canarsie, Prospect Park South, and Brownsville, during which three victims were wounded.  In the first November 7 shooting, Agoro, Bailey, Battice, Fremont and Thompson drove to Canarsie, where they shot at a group of individuals.  The defendants then drove back to Thompson’s residence, before setting out again for a second shooting in Canarsie, during which two individuals were wounded in their legs.  On November 9, 2020, Agoro, Destine, Hepburn and Thompson drove to Prospect Park South, where they shot at a group of individuals but did not hit anyone.  Later that same day, Agoro, Fremont, Hepburn, Lima and Thompson drove to Brownsville for another shooting, where one victim was shot in the shoulder and grazed in her back. 

These indictments are part of a coordinated effort to dismantle the Brooklyn sets of GD and their leadership by federal and state authorities, including the United States Attorney’s Office for the Eastern District of New York, the KCDA, the Joint FBI-NYPD Safe Streets Task Force, and the NYPD’s Gun Violence Suppression Division.  As part of the federal-state initiative, the United States Attorney’s Office for the Eastern District of New York and the KCDA have brought multiple prosecutions against members and associates of GD.

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

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

The government’s case is being handled by the Office’s Organized Crime and Gangs Section.  Assistant United States Attorneys Jonathan Siegel and Kayla C. Bensing along with Special Assistant United States Attorneys Gillian DiPietro and James Slattery are in charge of the prosecution.

The Defendants:

OLUWAGBENGA AGORO (also known as “Gee Banga”)
Age:  21
Brooklyn, New York

LORENZO BAILEY (also known as “Renzo” and “St. Clair Bailey”)
Age:  32
Brooklyn, New York

QUINCY BATTICE (also known as “Hush Dinero” and “George Ayala”)
Age:  32
Brooklyn, New York

DAVON BROWN (also known as “Chico Dinero”)
Age:  27
Brooklyn, New York

HANS DESTINE (also known as “YL Flocks”)
Age:  30
Brooklyn, New York

JEAN FREMONT (also known as “Juno” and “Bigga Twirl”)
Age:  30
Brooklyn, New York

RICARDO HEPBURN (also known as “Riko Floxks”)
Age:  19
Brooklyn, New York

TRISTON LAWRENCE (also known as “Birdy Flock”)
Age:  27
Brooklyn, New York

McKOY LIMA (also known as “Mak”)
Age:  26
Brooklyn, New York

DERYCK THOMPSON (also known as “Benzo,” “DBenzo” and “Kenzie”)
Age:  22
Brooklyn, New York

MICHAEL WILLIAMS (also known as “Mikey Floxks” and “Mikey Gzz”)
Age:  19
Brooklyn, New York

E.D.N.Y. Docket Nos. 20-CR-293 (S-1) (WFK)

Earlier today, a nine-count superseding indictment was unsealed in federal court in Brooklyn charging four members of the Ninedee Gang, a violent street gang based at the Louis H. Pink Houses (“Pink Houses”) in East New York, with racketeering, murder in-aid-of racketeering, drug trafficking, firearms offenses and robbery.  The new charges were announced against defendants Quintin Green, Chayanne Fernandez, Maliek Miller and Kevin Wint.  Green and Wint were arrested this morning and will be arraigned this afternoon before United States Magistrate Judge Ramon E. Reyes, Jr.  Fernandez and Miller were already in federal custody as a result of prior charges and will be arraigned at later date.  

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, Jacqueline Maguire, Acting Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Dermot F. Shea, Commissioner, New York City Police Department (NYPD), announced the arrests and charges.

“It is our hope that today’s charges against members of the Ninedee Gang bring some solace to the family of Shatavia Walls as we seek justice for her senseless, cold-blooded murder,” stated Acting United States Attorney Kasulis.  “This Office and its law enforcement partners are committed to ending the brutality that violent gangs so wantonly inflict on citizens in our communities.  I commend the FBI special agents and the NYPD detectives for their relentless investigative work on the case.”

“This investigation serves as a warning to criminals who behave as if there are no consequences to their actions. We have the ability in the federal criminal justice system to put these violent gang members away for a long time, and we will persist in our efforts to get them off the streets.  Our outstanding partnership with the NYPD allows us to pursue the most violent and persistent offenders and hold them accountable for their blatant disregard for human life and safe communities,” stated FBI Acting Assistant Director-in-Charge Maguire.

“The NYPD remains committed to providing every resource possible to dismantling the violent gangs and crews that prey on New Yorkers. I commend our police investigators and the prosecutors in the United States Attorney’s Office for the Eastern District of New York for leading us to justice with this federal indictment,” stated NYPD Commissioner Shea.

As detailed in the superseding indictment and court filings, the Ninedee Gang is a criminal enterprise operating in East New York, Brooklyn.  The gang’s leaders, including Wint, promoted the gang on social media and in rap videos, highlighting its violence, drug sales and fraudulent activities. 

The plan to kill Walls was allegedly hatched by Green, Fernandez, Miller and others following a dispute on the Fourth of July 2020 over the lighting of fireworks.  During a confrontation with the victim, Miller called her a “snitch” and fired a gunshot into the air.  Walls had been called as a government witness one year earlier during a federal criminal trial in Brooklyn and testified that she had been shot by another Pink Houses gang member.

On the evening of July 7, 2020, Ninedee Gang members, including Green and a juvenile male, opened fire on Walls as she walked through a courtyard at the Pink Houses.  Walls was shot multiple times and succumbed to the gunshot wounds on July 17, 2020.  Ballistic evidence recovered from the scene of the fatal shooting showed that one of the handguns used to kill Walls matched the firearm used by Miller on the Fourth of July.  In the days following Walls’ murder, the defendants posted on Facebook a newspaper article about the murder and claimed credit on behalf of the Ninedee Gang.  

Additionally, Green is charged with the Hobbs Act robbery of a Target store on Staten Island on November 3, 2020; Wint with access device fraud; Fernandez, Miller and Wint with conspiracy to distribute marijuana; and Green, Fernandez and Miller with unlawful use and possession of firearms.

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

If convicted of murder in-aid-of racketeering, Green, Fernandez and Miller face a mandatory sentence of life imprisonment and are eligible for the death penalty.  If convicted of racketeering, Wint faces up to 20 years’ imprisonment, and up to 15 years’ imprisonment for accessory after the fact to Walls’s murder.

The government’s case is being handled by the Office’s Organized Crime and Gang Section.  Assistant United States Attorneys James P. McDonald and Emily J. Dean are in charge of the prosecution.

The Defendants:

QUINTIN GREEN (also known as “Wild Child”)
Age: 20
Brooklyn, New York

CHAYANNE FERNANDEZ (also known as “White Boy”)
Age: 21 
Brooklyn, New York

MALIEK MILLER (also known as “Leak”)
Age: 27 
Brooklyn, New York

KEVIN WINT (also known as “Kev G”)
Age: 27
Brooklyn, New York

E.D.N.Y. Docket No. 20-CR-331 (S-1) (LDH)

Earlier today, in federal court in Central Islip, Jason Langhorn, a member of the “Lowrider Brims” subset of the Bloods and an associate of the “Red Stone Gorilla” subset of the Bloods, a violent criminal enterprise operating in Riverhead, New York, pleaded guilty to firearm-related murder for his role in the slaying of Thomas Lacolla on November 17, 2015, while attempting to kill another rival of the gang.  The proceeding was held before United States Magistrate Judge A. Kathleen Tomlinson.

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, announced the guilty plea.

“As a result of the outstanding and tireless work by members of the Federal Bureau of Investigation, Long Island Gang Task Force, the Suffolk County East End Drug Task Force, the Riverhead Police Department and the Suffolk County Police Department, Homicide Squad, Langhorn has been held accountable for his role in an act of senseless gang violence that resulted in a man’s death,” stated Acting United States Attorney Kasulis.  “It is our hope that today’s guilty plea brings a measure of closure to the victim’s family.”

According to court filings and facts presented during the plea proceeding, on November 17, 2015, Langhorn, along with two other members of the Bloods, went to a location in the Riverside section of Riverhead looking to kill a rival gang member.  They sprayed 39 shots from three firearms, including an assault rifle, into a vehicle they believed was occupied by the rival gang member, but instead was occupied by Lacolla, who was killed in the fusillade.

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

The government’s case is being handled by the Office’s Long Island Criminal Division.  Assistant United States Attorneys Nicole Boeckmann and Michael Maffei are in charge of the prosecution.   

Defendant:

JASON LANGHORN (also known as “Hov”)
Age: 39
Riverhead, New York

E.D.N.Y. Docket No. 18-CR-606 (S-2) (JS)

An indictment was unsealed today in federal court in Central Islip charging Rickey Lynch with violating the Toxic Substances Control Act of 1976 (“TSCA”), making false statements and aggravated identity theft.  Lynch is the first person to be charged with a felony violation of TSCA since the statute was amended in 2016 to include enhanced punishments for certain conduct posing a risk of death or serious bodily injury.  Lynch was arrested this morning and will be arraigned this afternoon before United States District Judge Gary R. Brown.

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, and Tyler Amon, Special Agent-in-Charge of the Environmental Protection Agency’s Criminal Investigation Division, New York (EPA), announced the charges.

“As alleged, the defendant placed a very young child at serious risk of continued exposure to toxic chemical hazards by deliberately disregarding federal standards that ensure the safe remediation of lead-based paint.  He then compounded the risk of harm by lying and falsifying documents in a failed effort to establish his purported compliance with those standards,” stated Acting United States Attorney Kasulis.  “Today’s arrest serves as a warning that those who circumvent environmental regulations that protect the community from the well-known dangers of lead-based paint will face the consequences.”

“Defendant Lynch knowingly violated the requirements of safely removing lead from a home and in so doing endangered the health of a vulnerable family,” stated EPA Special Agent-in-Charge Amon.  “The EPA remains focused on holding accountable companies and individuals that cut corners and fail to put public health and safety first.”

As alleged in the indictment, in January 2020, Lynch’s company, Bright Lights Supreme Cleaning, Inc., was retained by residents of Freeport, Long Island, to remediate hazardous lead-based paint from their home after the family’s two-year-old son was found to have elevated levels of lead in his blood.  Federal regulations require that lead-based paint abatement work be performed and supervised by individuals who have been certified by the EPA.  The regulations also establish work practice standards to ensure that lead-based paint removal is done safely.  Over the course of several days, Lynch remediated the lead-based paint himself, despite lacking the proper certification to either perform or supervise such work. Lynch also failed to comply with various work practice standards and did not use a High Efficiency Particulate Air (“HEPA”) filtration system that would have contained the spread of toxic dust and debris throughout the house.  As a result of Lynch’s failure to comply with the regulations, lead dust exceeding legally permissible limits spread throughout the house. 

In addition, Lynch faces charges of making false statements and aggravated identity theft related to his responses to an inquiry by the EPA.  Specifically, Lynch took steps to obstruct the agency’s investigation by supplying a fake subcontractor agreement, an affidavit and other documents that contained the forged signature of an individual Lynch falsely identified as having supervised the abatement work on the Freeport residence. 

The charges in the indictment are allegations, and the defendant is presumed innocent unless and until proven guilty.  Under TSCA, the maximum sentence for conviction of a violation that places one or more individuals at risk of death or serious bodily injury is 15 years’ imprisonment.

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:

RICKEY LYNCH
Age:  58
Arverne, New York

E.D.N.Y. Docket No. 21-CR-405 (GRB)

Earlier today, in federal court in Brooklyn, Carlos Gentil Ordonez Martinez was sentenced to 210 months’ imprisonment by United States District Judge Edward R. Korman for conspiracy to internationally distribute cocaine.  As part of the sentence, the Court entered a forfeiture money judgment of $10 million.  Ordonez pleaded guilty to the charge in November 2019.

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, Ray Donovan, Special Agent-in-Charge, Drug Enforcement Administration, New York Division (DEA), and Peter C. Fitzhugh, Special Agent-in-Charge, Homeland Security Investigations, New York (HSI), Dermot F. Shea, Commissioner, New York City Police Department (NYPD), and Kevin P. Bruen, Acting Superintendent, New York State Police (NYSP), announced the sentence.

“It is fitting that the defendant, who trafficked in massive amounts of cocaine to be sold at high prices in the United States, will now pay for his crimes by forfeiting his freedom for more than 17 years and forfeiting $10 million in criminal proceeds,” stated Acting United States Attorney Kasulis.  “This Office and its law enforcement partners will continue to work tirelessly to bring national and international narcotraffickers to justice.” 

Ms. Kasulis expressed her grateful appreciation to HSI Panama, the HSI Panama Transnational Criminal Investigative Unit (TCIU), the Panamanian National Police, DEA Bogota Country Office Group 2 (BCO2) and the Colombian National Police (CNP) Direccion de Investigacion Criminal e Interpol (DIJIN) Sensitive Investigative Unit (SIU) for their assistance.

“The real Narcos of the world are receiving justice, as evidenced by today’s sentencing,” stated DEA Special Agent-in-Charge Donovan.  “Time and again, this DEA investigation has led to the arrest, extradition, and sentencing of an international drug kingpin responsible for flooding the streets of U.S. cities with multi-ton quantities of dangerous drugs. I applaud the members of the New York Drug Enforcement Task Force, HSI, and the U.S. Attorney’s Office Eastern District of New York for their diligent work throughout this investigation.”

“Today's sentencing sends a resounding message that HSI Special Agents are committed to working with our law enforcement partners to aggressively uncover, dismantle and disrupt transnational organizations who conspire to distribute cocaine,” stated HSI Special Agent-in-Charge Fitzhugh. “Ordonez Martinez’s sentencing and $10 million forfeiture reinforces local and federal law enforcement commitment to bring to justice those individuals and organizations who seek to profit from selling dangerous controlled substances that tear at the very fabric of our community.”

According to court filings and proceedings, from 2009 through 2014, Ordonez participated in a massive international drug trafficking conspiracy responsible for trafficking tens of thousands of kilograms of cocaine from laboratories in the Colombian jungle to intermediary locations in Central America and Mexico by sea, before the cocaine was transported to the United States.  Ordonez supplied the conspiracy with the cocaine it trafficked and also owned a portion of the multi-ton shipments of cocaine that the organization dispatched from Colombia to intermediary locations, including Honduras, Guatemala and Mexico, before being sent to the United States where it was sold.  He further increased his share of the profits by receiving payment per kilogram at the substantially higher prices yielded from selling the cocaine further north and closer to the United States. Ordonez received a conservatively estimated $10,000,000 for his involvement in the conspiracy.  Ordonez was arrested in Panama in June 2018 and extradited to the United States on July 12, 2018.

This case 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 Nomi D. Berenson is in charge of the prosecution.

The Defendant:

CARLOS GENTIL ORDONEZ MARTINEZ (also known as “Picapiedra” and “Bam Bam”)
Age:  50
Cauca, Colombia

E.D.N.Y. Docket No. 18-CR-200 (ERK)

A California man pleaded guilty today in the Eastern District of New York for his participation in a coordinated cryptocurrency and securities fraud scheme through purported digital currency platforms and foreign-based financial accounts. 

As part of his guilty plea, John DeMarr, 55, of Santa Ana, admitted that he conspired with others to defraud investor victims by inducing them to invest in their companies, “Start Options” and “B2G,” based on materially false and misleading representations. Start Options purported to be an online investment platform that provided cryptocurrency mining, trading and digital asset trading services. B2G was purportedly an “ecosystem” that would allow users to trade B2G tokens, provide digital wallet staking and trade digital and fiat currencies “on a secure, comprehensive platform.” Both Start Options and B2G, however, were fraudulent. 

As part of the conspiracy, in approximately December 2017, DeMarr and others began offering securities in the form of investment contracts to U.S. and international investors through the Start Options website. Investments were accepted in Bitcoin, U.S. dollars or Euros. To participate, investors had to deposit their funds for a specified contract period, after which they were told that they could withdraw their money at a significant profit. 

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

Similarly, Start Options also claimed to feature celebrity endorsements to promote its securities offerings. For example, Start Options falsely represented that a professional athlete had endorsed Start Options when, in fact, the athlete was not involved with Start Options and his name and likeness were used without his consent. Based on this and other fraudulent promotional materials, investors sent millions of dollars’ worth of Bitcoin, Ethereum, and fiat currency to financial accounts, including cryptowallets, controlled by DeMarr and others in the U.S. and abroad. 

In late January 2018, rather than permitting Start Options investors to withdraw money from their accounts after the requisite time period, DeMarr and others required investors to roll over their accounts into an unregistered “initial coin offering,” or ICO, of B2G, the second of the two fraudulent companies in which DeMarr was involved. Among other fraudulent misrepresentations, DeMarr and others falsely told investors that the ICO would raise capital for the company to build an “ecosystem” that would allow users to trade B2G tokens, provide digital wallet staking, and trading. In truth, investors never actually received any digital tokens, and funds from the offering were not used to develop the B2G platform.

As part of the conspiracy, DeMarr and others also paid various promoters, including an actor famous for martial arts films made in the 1980s and 1990s, to serve as a promoter and celebrity spokesperson, falsely claiming that B2G could generate an “8000%” return for investors within one year, and that he was a participant in the ICO. DeMarr and others also created false press releases and whitepapers about B2G, fabricated B2G account statements and refused to allow investors to withdraw their money. 

DeMarr pleaded guilty to one count of conspiracy to commit securities fraud and is scheduled to be sentenced on Jan. 4, 2022. DeMarr faces a maximum sentence of five years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division, Acting U.S. Attorney Jacquelyn M. Kasulis of the Eastern District of New York, Assistant Director in Charge Kristi K. Johnson of the FBI’s Los Angeles Field Office, and Special Agent in Charge Ryan L. Korner of the IRS-Criminal Investigation (IRS-CI) Los Angeles Field Office made the announcement.

The FBI and IRS-CI are investigating the case.

Trial Attorney Kevin Lowell of the Criminal Division’s Fraud Section and Assistant U.S. Attorneys Kaitlin Farrell, Hiral Mehta and David Pitluck of the Eastern District of New York are prosecuting the case, with assistance on forfeiture matters from Assistant U.S. Attorney Laura Mantell. 

The Criminal Division’s Fraud Section plays a pivotal role in the Justice Department's fight against white collar crime around the country.

Earlier today, in federal court in Brooklyn, Richard Palmer was sentenced to 262 months’ imprisonment by United States District Judge Carol Bagley Amon, following the defendant’s guilty plea in April 2021, to coercion and enticement of a child to engage in illegal sexual conduct and distribution of child pornography.  As part of his sentence, Palmer must also serve five years’ supervised release following his imprisonment, during which time he must remain registered as a sex offender and have no unsupervised or unapproved contact with minors.

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, and William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the sentence.

“Today, the defendant, a serial predator and registered sex offender, received a well-deserved, lengthy term of imprisonment for his efforts to convince a young child to engage in sexual acts by texting him thousands of obscene messages and photographs,” stated Acting United States Attorney Kasulis.  “Protecting vulnerable, underage children from sexual exploitation will always be a high priority of this Office.”  Ms. Kasulis extended her grateful appreciation to the FBI New York Child Exploitation and Human Trafficking Task Force for its investigative work and assistance.

According to court filings, in September 2019, an adult woman contacted the FBI and reported that Palmer had sent her unsolicited emails containing child pornography.  Law enforcement subsequently conducted searches of Palmer’s residence in Maspeth, Queens, and his electronic devices.  The searches revealed that Palmer had also sent thousands of text messages, including explicit and obscene photographs, to an 11-year-old child in an effort to convince that child to engage in sexual acts with him.  At the time, Palmer was a registered sex offender who had been convicted in 2010 in Queens of attempted promotion of a sexual performance by a child.

This prosecution is part of Project Safe Childhood, a nationwide initiative led by the Department of Justice to combat the 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.

Assistant United States Attorney Devon Lash is in charge of the prosecution.

The Defendant:

RICHARD PALMER
Age:  40
Maspeth, Queens

E.D.N.Y. Docket No. 19-CR-556 (CBA)

Proceeds from the Sale Will be Applied to Forfeiture Money Judgment Against Shkreli

United States Sells Unique Wu-Tang Clan Album Forfeited by Convicted Hedge Fund Manager Martin Shkreli

Earlier today, the United States sold the sole copy of the Wu-Tang Clan album “Once Upon a Time in Shaolin” (the “Album”) which had previously been ordered to be forfeited as a substitute asset in connection with the approximately $7.4 million forfeiture money judgment (Forfeiture Money Judgment) entered against Shkreli at his March 2018 sentencing.  Proceeds from the sale of the Album will be applied to satisfy the outstanding balance owed on the Forfeiture Money Judgment.  The contract of sale contains a confidentiality provision that protects information relating to the buyer and price.

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, announced the sale of the Album.

“Through the diligent and persistent efforts of this Office and its law enforcement partners, Shkreli has been held accountable and paid the price for lying and stealing from investors to enrich himself.  With today’s sale of this one-of-a-kind album, his payment of the forfeiture is now complete,” stated Acting U.S. Attorney Kasulis.  Ms. Kasulis acknowledged the significant efforts of the U.S. Marshals Service and, in particular, the work of the U.S. Marshals Service’s Office of General Counsel and the Complex Asset Unit of the agency’s Asset Forfeiture Division, as well as assistance provided by the Department of Justice’s Civil Division, Commercial Litigation Branch.

Shkreli was the founder and managing member of hedge funds MSMB Capital Management LP and MSMB Healthcare Management LP and the former Chief Executive Officer of Retrophin Inc. (“Retrophin”), a publicly traded biopharmaceutical company.  Following a six-week trial in federal court in Brooklyn, Shkreli was convicted in August 2017 of two counts of securities fraud and one count of securities fraud conspiracy for orchestrating a series of schemes to defraud investors in the hedge funds and to manipulate the price and trading volume of Retrophin’s stock.  United States District Judge Kiyo A. Matsumoto sentenced Shkreli to seven years’ imprisonment, to be followed by three years’ supervised release, and ordered him to pay the Forfeiture Money Judgment, approximately $388,000 in restitution and a $75,000 fine.  Judge Matsumoto also ordered Shkreli to forfeit the Album and other substitute assets to satisfy the Forfeiture Judgment. 

Shkreli’s conviction and sentence, including the imposition of the Forfeiture Money Judgment, were affirmed by the U.S. Court of Appeals for the Second Circuit in July 2019.  Following the U.S. Supreme Court’s denial of Shkreli’s request for further review of his conviction and sentence, the government seized the Album and other assets owed by Shkreli.   

At the time Shkreli purchased the Album in 2015, it was marketed as “both a work of art and an audio artifact.”  The Album includes a hand-carved nickel-silver box as well as a leather-bound manuscript containing lyrics and a certificate of authenticity.  The Album is subject to various restrictions, including those relating to the duplication of its sound recordings. In September 2017, just weeks after his conviction but before the district court-imposed forfeiture, Shkreli attempted to sell the Album through an on-line auction.

Forfeiture matters related to Shkreli’s sentence were handled by Assistant United States Attorneys Laura D. Mantell and Claire S. Kedeshian of the newly formed Asset Recovery Section in the Office’s Criminal Division.  Acting U.S. Attorney Kasulis and Assistant United States Attorneys Alixandra E. Smith and G. Karthik Srinivasan (now an Assistant United States Attorney in the Western District of Texas) were in charge of the prosecution of Shkreli, and defended his conviction and sentence on appeal.

United States District Judge Ann M. Donnelly entered an order yesterday forfeiting a rare cuneiform tablet bearing a portion of the epic of Gilgamesh, a Sumerian poem considered one of the world’s oldest works of literature.  Known as the Gilgamesh Dream Tablet, it originated in the area of modern-day Iraq and entered the United States contrary to federal law.  An international auction house (the “Auction House”) later sold the tablet to Hobby Lobby Stores, Inc. (“Hobby Lobby”), a prominent arts-and-crafts retailer based in Oklahoma City, Oklahoma, for display at the Museum of the Bible (the “Museum”).  Law enforcement agents seized the tablet from the Museum in September 2019.

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, Kenneth A. Polite, Jr., Assistant Attorney General of the Justice Department’s Criminal Division, and Peter C. Fitzhugh, Special Agent-in-Charge, Homeland Security Investigations, New York (HSI), announced the forfeiture decree.

“This forfeiture represents an important milestone on the path to returning this rare and ancient masterpiece of world literature to its country of origin,” stated Acting U.S. Attorney Kasulis.  “This Office is committed to combating the black-market sale of cultural property and the smuggling of looted artifacts.”

“Forfeiture of the Gilgamesh Dream Tablet demonstrates the Department’s continued commitment to eliminating smuggled cultural property from the U.S. art market,” stated Assistant Attorney General Polite.  “Thwarting trade in smuggled goods by seizing and forfeiting an ancient artifact shows the department’s dedication to using all available tools, including forfeiture, to ensure justice.”

“The trafficking of cultural property and art is a lucrative criminal enterprise that transnational criminal organizations exploit to make a profit, regardless of its destructive consequence to cultures around the globe,” stated HSI Special Agent-in-Charge Fitzhugh.  “HSI continues to partner in art and antiquities investigations to ensure looted pieces are no longer trafficked through commerce for an illicit profit, because the cultural value of this tablet that travelled the world under false provenance exceeds any monetary value.” 

A 12-tablet Babylonian version of the Gilgamesh epic, written in Akkadian, was discovered in 1853 in the ruins of the library of the Assyrian King Assur Banipal in Nineveh (located in modern-day northern Iraq).  The events in the epic revolve around King Gilgamesh of Uruk (located in modern-day southern Iraq). 

The government’s investigation showed that in 2003, a U.S. antiquities dealer (the “Antiquities Dealer”) purchased the Gilgamesh Dream Tablet, encrusted with dirt and unreadable, from a family member of a coin dealer in London.  The Antiquities Dealer and a U.S. cuneiform expert shipped the tablet into the United States by international post without declaring formal entry.  After the tablet was imported and cleaned, experts in cuneiform recognized it as bearing a portion of the Gilgamesh epic in which the protagonist describes his dreams to his mother.  The protagonist’s mother interprets the dreams as foretelling the arrival of a new friend.  She tells her son, “You will see him and your heart will laugh.”  The names of the hero, Gilgamesh, and the character who becomes his friend, Enkidu, are replaced in this tablet with the names of deities Sin and Ea.  The tablet measures approximately 6-inches by 5-inches and is written in the Akkadian language.

As alleged in the government’s amended complaint, in 2007, the Antiquities Dealer sold the Gilgamesh Dream Tablet with a false provenance letter that stated the tablet had been inside a box of miscellaneous ancient bronze fragments purchased in an auction in 1981.  This false letter traveled with the tablet as it was sold several times in different countries, and a later owner provided the letter to the Auction House in London.  In 2014, the Auction House sold the Gilgamesh Dream Tablet to Hobby Lobby in a private sale and an Auction House employee carried it on a flight from London to the United States and then transferred it to New York.  Hobby Lobby consented to the tablet’s forfeiture based on the tablet’s illegal importations into the United States in 2003 and 2014.

The government’s case is being prosecuted by Assistant United States Attorney Sylvia Shweder and Trial Attorney Ann Brickley of the Department of Justice’s Money Laundering and Asset Recovery Section (MLARS).

The Department of Justice has a remission process for judicially forfeited property. An interested party may submit a petition to the U.S. Attorney for the Eastern District of New York. The U.S. Attorney then will forward a package to MLARS containing the petition, the seizing agency’s report and recommendation, and its own recommendation as to how MLARS should proceed. MLARS makes a determination about the petitions based on the papers received, and in accordance with the governing law and department policies.

E.D.N.Y. Docket No.: 20-CV-2222 (AMD)

The U.S. District Court for the Eastern District of New York ordered the forfeiture of a rare cuneiform tablet bearing a portion of the epic of Gilgamesh, a Sumerian poem considered one of the world’s oldest works of literature. 

Known as the Gilgamesh Dream Tablet, it originated in the area of modern-day Iraq and entered the United States contrary to federal law. An international auction house (the Auction House) later sold the tablet to Hobby Lobby Stores Inc. (Hobby Lobby), a prominent arts-and-crafts retailer based in Oklahoma City, Oklahoma, for display at the Museum of the Bible (the Museum). Law enforcement agents seized the tablet from the Museum in September 2019.

“Forfeiture of the Gilgamesh Dream Tablet demonstrates the department’s continued commitment to eliminating smuggled cultural property from the U.S. art market,” said Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division. “Thwarting trade in smuggled goods by seizing and forfeiting an ancient artifact shows the department’s dedication to using all available tools, including forfeiture, to ensure justice.”

“This forfeiture represents an important milestone on the path to returning this rare and ancient masterpiece of world literature to its country of origin,” said Acting U.S. Attorney Jacquelyn M. Kasulis for the Eastern District of New York. “This office is committed to combating the black-market sale of cultural property and the smuggling of looted artifacts.”

“The trafficking of cultural property and art is a lucrative criminal enterprise that transnational criminal organizations exploit to make a profit, regardless of its destructive consequence to cultures around the globe,” said Special Agent in Charge Peter C. Fitzhugh of Homeland Security Investigations (HSI), New York. “HSI continues to partner in art and antiquities investigations to ensure looted pieces are no longer trafficked through commerce for an illicit profit, because the cultural value of this tablet that travelled the world under false provenance exceeds any monetary value.” 

As alleged in the government’s amended complaint, in 2003, a U.S. antiquities dealer (the Antiquities Dealer) purchased the Gilgamesh Dream Tablet, encrusted with dirt and unreadable, from the family member of a London coin dealer. The Antiquities Dealer and a U.S. cuneiform expert shipped the tablet into the United States by international post without declaring the contents as required. After the tablet was imported and cleaned, experts in cuneiform recognized it as bearing a portion of the Gilgamesh epic. The tablet measures approximately 6 inches by 5 inches and is written in the Akkadian language.

The amended complaint further alleged that, in 2007, the Antiquities Dealer sold the Gilgamesh Dream Tablet with a false provenance letter stating that the tablet had been inside a box of miscellaneous ancient bronze fragments purchased in a 1981 auction. This false letter traveled with the tablet as it was sold several times in different countries, and a later owner provided the letter to the Auction House in London. In 2014, the Auction House sold the Gilgamesh Dream Tablet to Hobby Lobby in a private sale and an Auction House employee carried it on a flight from London to the United States and then transferred it to New York.  Hobby Lobby consented to the tablet’s forfeiture based on the tablet’s illegal importations into the United States in 2003 and 2014.

HSI’s Cultural Property, Art and Antiquities Unit is investigating the case. 

Trial Attorney Ann Brickley of the Criminal Division’s Money Laundering and Asset Recovery Section (MLARS) and Assistant U.S. Attorney Sylvia Shweder of the U.S. Attorney’s Office for the Eastern District of New York handled this matter.

The Department of Justice has a remission process for judicially forfeited property. An interested party may submit a petition to the U.S. Attorney for the Eastern District of New York. The U.S. Attorney then will forward a package to MLARS containing the petition, the seizing agency’s report and recommendation, and its own recommendation as to how MLARS should proceed. MLARS makes a determination about the petitions based on the papers received, and in accordance with the governing law and department policies.

Earlier today, in federal court in Brooklyn, Orlando Lopez pleaded guilty to nine counts of child exploitation and one count of possession of child pornography.  The proceeding took place before United States District Judge Eric R. Komitee.  When sentenced, Lopez faces up to 50 years’ imprisonment on each count of production of child pornography, as well as forfeiture, restitution and a fine.

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, announced the guilty plea.

“With today’s guilty plea, the defendant admits to preying on vulnerable young children for the cruel purpose of sexually exploiting them, and he also admits to possessing thousands of pornographic videos and photographs depicting his depraved acts of sexual abuse.” stated Acting United States Attorney Kasulis.  “While the defendant’s admission of guilt cannot undo the terrible harm he has inflicted, it does provide assurance that this Office and its law enforcement partners remain steadfast in their commitment to prosecuting dangerous predators like the defendant to the fullest extent of the law.”

Ms. Kasulis expressed her grateful appreciation to the Federal Bureau of Investigation, New York Field Office, the New York City Police Department and the Queens County District Attorney’s Office for their assistance with the case.

According to court filings and admissions made in court at the time he entered his plea, Lopez created child pornography by sexually abusing children and taking photographs and videos of the abuse.  Many of the children Lopez targeted lived with their families near Lopez’s residence in Queens and were between the ages of two and 10 years old when he sexually abused them.  In order to gain access to his victims, Lopez attempted to befriend their parents.  Law enforcement recovered thousands of photos and videos from Lopez’s residence depicting him engaging in sexual activity with children.

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 Attorney Tanya Hajjar.

The Defendant:

ORLANDO LOPEZ
Age:  66
Jamaica, Queens

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

Jacquelyn Kasulis, Acting United States Attorney for the Eastern District of New York, and Peter C. Fitzhugh, Special Agent-in-Charge, Homeland Security Investigations, New York (HSI), announced today the seizure of 17 Jewish Funeral Scrolls, Pinkas Manuscripts (“Scrolls and Manuscripts”) and Community Records that had been taken from Jewish communities in Romania, Hungary, Ukraine and Slovakia during World War II.  The Scrolls and Manuscripts, which date from the mid-19th century to World War II, were confiscated from Jewish communities and disappeared during the Holocaust.  The artifacts were found through a Brooklyn auction house that offered them for sale, as well as a consigner and a purchaser. Three additional artifacts are believed to be in Israel and one in upstate New York. 

“The Scrolls and Manuscripts that were illegally confiscated during the Holocaust contain priceless historical information that belongs to the descendants of families that lived and flourished in Jewish communities before the Holocaust. This Office hopes that today’s seizure will contribute to the restoration of pre-Holocaust history in Eastern Europe.” stated Acting U.S. Attorney Kasulis.  “I commend the efforts of this Office’s Civil Division and HSI in recovering these important religious artifacts.”

“The recovery of these 19th century Judaica Manuscripts and Scrolls looted during the Holocaust from Romania, Hungary, Slovakia, and Ukraine in the midst of our world’s darkest of times, is the culmination of an extensive HSI cultural property investigation, and we are fortunate to be part of the team that is able to return these artifacts to their rightful Jewish communities,” stated HSI Special Agent-in-Charge Fitzhugh. “The HSI NY Cultural Property, Art & Antiquities Investigations unit works tirelessly with the United States Attorney’s Office for the Eastern District of New York to investigate the looting, theft and sale of critical pieces of history, and will continue to bring to justice the individuals and transnational criminal organizations who profit from the trafficking of these cultural treasures.”

As set forth in the search warrant affidavit, in February 2021, law enforcement learned that an auction house located in the Eastern District of New York had offered for sale 21 Manuscripts and Scrolls originating from Jewish communities that existed before World War II and the Holocaust.  The members of those communities from which the Scrolls and Manuscripts were taken had been gathered in ghettos, robbed of their property and deported to Nazi death camps, where the majority of them were killed.  After the end of World War II, surviving members of the communities returned to find their homes ransacked and buildings emptied of property.  Among the items that were stolen were the Scrolls and Manuscripts that contained information related to the Jewish communities from as early as 1840 and up through and including the Holocaust.  These Scrolls and Manuscripts contained prayers for the dead, memorial pages and/or the names of deceased members of the Jewish communities, operating rules of the society, society member payments, obligations, society regulations, the identity of society religious leaders, and, in some cases, the names of the society members who were deported by the Nazis to the Auschwitz concentration camp.  The Manuscripts and Scrolls were confiscated by individuals who had no right to do so during and after the Holocaust. Absent any provenance or documentation of conveyance from any survivors of those communities, there is no legitimate means by which the Manuscripts and Scrolls could have been imported into the United States.

The government’s case is being handled by Assistant United States Attorney Artemis Lekakis of the Office’s Civil Division and the investigation was conducted by Department of Homeland Security Agents Megan Buckley and Robert Mancene.

E.D.N.Y. Docket No.: 21-MJ-837 (PK)

A superseding indictment was filed today in federal court in Brooklyn charging nine defendants with acting and conspiring to act in the United States as illegal agents of the People’s Republic of China (PRC) without prior notification to the Attorney General, and engaging and conspiring to engage in interstate and international stalking.  Two defendants, Tu Lan and Zhu Feng, were also charged with obstruction of justice and conspiracy to obstruct justice arising out of the same course of conduct.  The defendants, allegedly acting at the direction and under the control of PRC government officials, conducted surveillance of and engaged in a campaign to harass, stalk and coerce certain residents of the United States to return to the PRC as part of a global, concerted and extralegal repatriation effort known as “Operation Fox Hunt.”  In addition to the six defendants previously charged in a related criminal complaint in October 2020 and a related indictment in May 2021, the superseding indictment alleges that Tu Lan, a new defendant who was employed as a prosecutor with the Hanyang People’s Procuratorate, traveled to the United States, directed the harassment campaign and ordered a coconspirator to destroy evidence to obstruct the criminal investigation.

Defendants Tu Lan, Hu Ji, Li Minjun, Zhai Yongqiang and Zhu Feng remain at large.    Co-defendants Michael McMahon, Zheng Congying and Zhu Yong will be arraigned in the Eastern District of New York at a later date.  The name of the ninth defendant remains under seal.

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York; Mark J. Lesko, Acting Assistant Attorney General for National Security; George M. Crouch, Jr., Special Agent-in-Charge, Federal Bureau of Investigation, Newark Field Office (FBI); Peter C. Fitzhugh, Special Agent-in-Charge, Homeland Security Investigations, New York  (HSI); and Keith Byrne, Special Agent-in-Charge, U.S. Department of State’s Diplomatic Security Service, New York Field Office (DSS), announced the superseding indictment.

“As alleged, the defendants, acting as agents of the PRC, carried out an illegal and clandestine campaign to harass and threaten targeted U.S. residents in order to force them to return to the PRC. Unregistered, roving agents of a foreign power are not permitted to engage in secret surveillance of U.S. residents on American soil, and their illegal conduct will be met with the full force of U.S. law,” stated Acting U.S. Attorney Kasulis.  “To the extent the PRC seeks to repatriate its citizens to the PRC, its agents are required to register with the Attorney General of the United States, coordinate with U.S. officials, and adhere to U.S. laws and protocols.” Ms. Kasulis also extended her thanks and appreciation to the FBI’s Newark and Los Angeles field offices for their work on the case.

“Law enforcement officials around the world act according to a professional code of conduct,” stated Acting Attorney General Lesko. “They act to enforce the law, not to violate it in such an egregious manner. That a prosecutor and police officer not only directed and participated in a criminal scheme on U.S. soil, but then attempted to cover it up, is an affront to justice of the highest order.”

“Today's announcement serves to highlight the efforts of the FBI and its law enforcement partners to tirelessly and aggressively continue to utilize all available investigative tools and methods at their disposal to combat any illegal intrusions by the Chinese government to unilaterally undermine our economy and our free markets, stated FBI Special Agent-in-Charge Crouch, Newark Field Office.  “The FBI remains committed to holding actors from the People's Republic of China accountable when they direct criminal activity on U.S. soil.  Further, the FBI will vigorously defend the American ideals of freedom and the rule of law against any foreign malign influence actors.”

“HSI, with its law enforcement partners, will outfox attempts to circumvent our laws, undermine our national security, and target U.S. residents,” stated HSI Special Agent-in-Charge Fitzhugh. “The defendants will now face the true justice they denied their victims.”

“This is a perfect illustration of the domestic and global reach of the Diplomatic Security Service and our ability to partner with U.S. prosecutorial and law enforcement agencies on complex international, multi-jurisdictional cases,” stated DSS Special Agent-in-Charge Byrne. “DSS will continue to work closely with the United States Attorney’s Office and its law enforcement colleagues to detect and deter similar illegal activities that occur at home and abroad.”

In and around 2012 and 2014, the PRC government caused the International Criminal Police Organization (also known as “Interpol”), an inter-governmental law enforcement organization, to issue “Red Notices” for John Doe #1 and his wife, Jane Doe #1.  According to the Red Notices, John Doe #1 was wanted by the PRC government for “embezzlement, abuse of power [and] acceptance of bribes” which carried a maximum possible penalty of death under PRC law.  Jane Doe #1 was wanted by the PRC government for “accepting bribes” which carried a maximum possible penalty of life imprisonment under PRC law.

As alleged in the indictment, the nine defendants participated in an international campaign to threaten, harass, surveil and intimidate John Doe #1 and his family, in order to force John Doe #1 and Jane Doe #1 to return to the PRC as part of “Operation Fox Hunt,” a PRC Ministry of Public Security initiative to locate and repatriate alleged Chinese “fugitives” who had fled to foreign countries, including the United States.  Instead of operating with the approval and coordination of the U.S. government, PRC government officials carrying out Operation Fox Hunt traveled to the United States and directed non-official operatives in the United States to engage in violations of U.S. criminal law.  Specifically, between approximately 2016 and 2019, PRC government officials, including defendant Tu Lan, a PRC prosecutor with the Hanyang People’s Procuratorate, and Hu Ji, a PRC police officer with the Wuhan Public Security Bureau, traveled to the United States and directed other defendants to engage in unsanctioned and illegal conduct on behalf of the PRC to coerce the targeted victims to return to the PRC.

As further alleged in the superseding indictment, a centerpiece of this criminal scheme was an April 2017 effort, directed by PRC officials Tu Lan and Hu Ji, to transport John Doe #1’s elderly father from the PRC to the United States to convey a threat to John Doe #1 that his family in the PRC would be harmed if he did not return to the PRC.  At the direction of Tu Lan, Hu Ji and others, several defendants worked to investigate, surveil and locate John Doe #1 and his wife.  Tu Lan then traveled to the United States along with John Doe #1’s father and a medical doctor, Li Minjun.  While in the United States, Tu Lan directed several conspirators to surveil John Doe #1 and his family so the defendants would know where to bring John Doe #1’s father to deliver the demand that John Doe #1 return to the PRC.  Afterwards, Tu Lan returned to the PRC, where she continued to supervise the operation with Hu Ji and other PRC officials, directed other U.S.-based conspirators to continue stalking John Doe #1 and then ordered the return of John Doe #1’s father to the PRC after their attempts to render John Doe #1 and Jane Doe #1 were unsuccessful.  Zhu Feng, Hu Ji and Zhu Yong worked with McMahon, a private investigator, to gather intelligence about and locate John Doe #1 and Jane Doe #1. To evade detection and frustrate a criminal investigation of their conduct, Tu Lan allegedly directed one of the conspirators to “delete all the chat content” between the conspirators.  Subsequently, between 2017 and 2019,  other defendants continued to harass and stalk the victims at the direction of the PRC government. 

For example, on September 4, 2018, two defendants drove to the New Jersey residence of John Doe #1 and Jane Doe #1 and pounded on the front door.  The two defendants attempted to force open the door to the residence, then left a note at the residence that stated, “If you are willing to go back to the mainland and spend 10 years in prison, your wife and children will be all right.  That’s the end of this matter!”

The charges in the indictment are allegations, and the defendants are presumed innocent unless and until proven guilty.  If convicted, the defendants face a maximum of 10 years’ imprisonment for acting as unregistered agents of the PRC, five years’ imprisonment for conspiring to act as unregistered agents of the PRC, five years’ imprisonment for interstate stalking, and five years’ imprisonment for conspiring to engage in interstate stalking.  Defendants Tu Lan and Zhu Feng, who are separately charged with obstruction of justice and conspiracy to obstruct justice, face a maximum sentence of 20 years in prison if convicted of either of those crimes. 

The government’s case is being handled by the Office’s National Security and Cybercrime Section.  Assistant United States Attorneys Craig R. Heeren, J. Matthew Haggans and Ellen H. Sise 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.

New Defendants:

TU LAN
Age:  50
People’s Republic of China

ZHAI YONGQIANG
Age:  46
California; People’s Republic of China

Defendants Previously Indicted:

HU JI
Age:  46
People’s Republic of China

LI MINJUN
Age:  65
People’s Republic of China

ZHU FENG
Age:  34
Queens, New York; People’s Republic of China

MICHAEL MCMAHON
Age:  53
Mahwah, New Jersey

ZHENG CONGYING
Age:  24
Brooklyn, New York

ZHU YONG, also known as “Jason Zhu”
Age:  64
Norwich, Connecticut

E.D.N.Y. Docket No.  21-CR-265 (S-1) (PKC)

BROOKLYN, NY - The U.S. Department of Justice today launched five cross-jurisdictional strike forces to help reduce gun violence by disrupting illegal firearms trafficking in key regions across the country.  Leveraging existing  resources, the regional strike forces will better ensure sustained and focused coordination across jurisdictions and help stem the supply of illegally trafficked firearms from source cities, through other communities, and into five key market regions:  New York, Chicago, Los Angeles, the San Francisco Bay Area/Sacramento Region and Washington, D.C.

Each strike force region will be led by designated United States Attorneys, who will collaborate with the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) and with state and local law enforcement partners within their own jurisdiction (where firearms are used in crimes) as well as law enforcement partners in areas where illegally trafficked guns originate. These officials will use the latest data, evidence, and intelligence from crime scenes to identify patterns, leads, and potential suspects in violent gun crimes.

“All too often, guns found at crime scenes come from hundreds or even thousands of miles away. We are redoubling our efforts as ATF works with law enforcement to track the movement of illegal firearms used in violent crimes.  These strike forces enable sustained coordination across multiple jurisdictions to help disrupt the worst gun trafficking corridors,” stated Attorney General Merrick B. Garland. “The Department of Justice will use all of its tools – enforcement, prevention, intervention, and investment – to help ensure the safety of our communities – the department’s highest priority.”

According to gun trace data, the vast majority of firearms recovered in New York City originate outside the state and are illegally trafficked into New York. The new strike force, led by Audrey Strauss, the U.S. Attorney for the Southern District of New York, and Jacquelyn Kasulis, the Acting U.S. Attorney for the Eastern District of New York, will help ensure sustained and focused coordination between law enforcement and prosecutors in New York City with their counterparts in locations where many of the firearms originate.

“Gun violence has taken a terrible, unacceptable toll on our communities, and it must be stopped,” stated Acting U.S. Attorney Jacquelyn M. Kasulis.  “Stemming the flow of illegal guns into New York City is critical to eradicating gun violence in our city.  We are committed to working with our federal and state partners to investigate and prosecute gun trafficking to the fullest extent of the law.”

“Disrupting the flow of guns into New York City is an important part of our anti-violence efforts,” stated U.S. Attorney Audrey Strauss.  We look forward to working with our federal and state partners to investigate and prosecute gun trafficking cases.  Because many of the firearm source locations for New York City overlap with the source locations for firearms recovered in the District of Columbia, we will coordinate our efforts with our D.C. counterparts.”

The strike forces represent one important, concrete step in implementing the Department’s Comprehensive Violent Crime Reduction Strategy, which was announced on May 26, 2021. The comprehensive strategy supports local communities in preventing, investigating, and prosecuting gun violence and other violent crime—and requires U.S. Attorneys’ offices to work with federal, state, local and tribal law enforcement, as well as the communities they serve, to address the most significant drivers of violence in their districts. In guidance to federal agents and prosecutors as part of that comprehensive strategy, the Deputy Attorney General made clear that firearms traffickers providing weapons to violent offenders are an enforcement priority across the country. 

BROOKLYN, NY – A seven-count indictment was unsealed today in federal court in Brooklyn charging Thomas Joseph Barrack, Matthew Grimes, and Rashid Sultan Rashid Al Malik Alshahhi, also known as “Rashid Al Malik” and “Rashid Al‑Malik,” a citizen of the United Arab Emirates (UAE), with acting and conspiring to act as agents of the UAE between April 2016 and April 2018.  The indictment charges conduct relating to the defendants’ unlawful efforts to advance the interests of the UAE in the United States at the direction of senior UAE officials by influencing the foreign policy positions of the campaign of a candidate (the “Candidate”) in the 2016 United States Presidential Election (the “Campaign”) and, subsequently, the foreign policy positions of the United States government in the incoming administration, as well as seeking to influence public opinion in favor of UAE interests.  The indictment also charges Barrack with obstruction of justice and making multiple false statements during a June 20, 2019 interview with federal law enforcement agents.

Barrack and Grimes were arrested this morning in California and are scheduled to make their initial appearances this afternoon before United States Magistrate Judge Patricia Donahue at the federal courthouse in Los Angeles.  Alshahhi remains at large.

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, Mark J. Lesko, Acting Assistant Attorney General of the Justice Department’s National Security Division, and William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the arrests and indictment.

“As alleged, the defendants, using their positions of power and influence in a presidential election year, engaged in a conspiracy to illegally advance and promote the interests of the United Arab Emirates in this country, in flagrant violation of their obligation to notify the Attorney General of their activities and in derogation of the American people’s right to know when a foreign government seeks to influence the policies of our government and our public opinion,” stated Acting United States Attorney Kasulis.  “These arrests serve as a warning to those who act at the direction of foreign governments without disclosing their actions, as well as those who seek to mislead investigators about their actions, that they will be brought to justice and face the consequences.”  

Ms. Kasulis expressed her appreciation to the United States Attorney’s Office for the Central District of California, the United States Attorney’s Office for the District of Colorado and the FBI’s Los Angeles and Denver Field Offices for their assistance.

“The defendants repeatedly capitalized on Barrack’s friendships and access to a candidate who was eventually elected President, high-ranking campaign and government officials, and the American media to advance the policy goals of a foreign government without disclosing their true allegiances,” stated Acting Assistant Attorney General Lesko.  “The conduct alleged in the indictment is nothing short of a betrayal of those officials in the United States, including the former President.  Through this indictment, we are putting everyone—regardless of their wealth or perceived political power—on notice that the Department of Justice will enforce the prohibition of this sort of undisclosed foreign influence.” 

“American citizens have a right to know when foreign governments, or their agents, are attempting to exert influence on our government.  This is especially important to Americans during a Presidential election year, and the laws on the books were created to protect our nation from such untoward influence.  This case is about secret attempts to influence our highest officials, and when that corrupt behavior was discovered, we allege Mr. Barrack went even further, obstructing and lying to FBI special agents. In case it needs repeating, each of those bad choices is a federal felony, and each now comes with significant consequences - the first being today's indictment,” stated FBI Assistant Director-in-Charge Sweeney. 

Between April 2016 and November 2016, Barrack served as an informal advisor to the Campaign of the Candidate in the 2016 United States Presidential Election.  Between November 2016 and January 2017, Barrack served as Chairman of the Presidential Inaugural Committee.  Beginning in January 2017, Barrack informally advised senior United States government officials on issues related to United States foreign policy in the Middle East.  Barrack also sought appointment to a senior role in the United States government, including the role of Special Envoy to the Middle East.  Barrack served as the Executive Chairman of a global investment management firm headquartered in Los Angeles, and Grimes was employed at the firm and reported directly to Barrack. During the relevant time period, Alshahhi worked as an agent of the UAE and was in frequent contact with Barrack and Grimes, including numerous in-person meetings in the United States and the UAE. 

As alleged in the indictment, the defendants used Barrack’s status as a senior outside advisor to the Campaign and, subsequently, to senior United States government officials, to advance the interests of and provide intelligence to the UAE while simultaneously failing to notify the Attorney General that their actions were taken at the direction of senior UAE officials.  Barrack – directly and through Alshahhi and Grimes – was regularly and repeatedly in contact with the senior leadership of the UAE government.  On multiple occasions, Barrack referred to Alshahhi as the UAE’s “secret weapon” to advance its foreign policy agenda in the United States.

Barrack, Alshahhi and Grimes allegedly took numerous steps in the United States to advance the interests of the UAE.  For example, in May 2016, Barrack inserted language praising the UAE into a Campaign speech to be delivered by the Candidate about United States energy policy in May 2016 and emailed an advance draft of the speech to Alshahhi for delivery to senior UAE officials.  Similarly, throughout 2016 and 2017, the defendants sought and received direction and feedback, including talking points, from senior UAE officials in connection with national press appearances Barrack used to promote the interests of the UAE.  After one appearance in which Barrack repeatedly praised the United Arab Emirates, Barrack emailed Alshahhi, “I nailed it. . . for the home team,” referring to the UAE.  Barrack and Grimes also solicited direction from senior UAE officials in advance of the publication of an Op-Ed authored by Barrack and published in a national magazine in October 2016 and removed certain language at the direction of senior UAE officials, as relayed by Alshahhi.

Following the 2016 United States Presidential Election, the defendants repeatedly acted at the direction of UAE officials to influence the foreign policy positions of the incoming administration in favor of UAE interests.  For example, in December 2016, Barrack met with Grimes, Alshahhi and senior UAE government officials, during which he advised them to create a “wish list” of U.S. foreign policy items that the UAE wanted accomplished in the first 100 days, six months, year and four years of the incoming administration of the United States President-Elect.

In March 2017, Barrack and his co-defendants agreed to promote the candidacy of an individual favored by senior UAE officials for the position of United States Ambassador to the UAE.  In May 2017, Barrack agreed to provide Alshahhi with non-public information about the views and reactions of senior United States government officials following a White House meeting between senior United States officials and senior UAE officials. 

In September 2017, Alshahhi communicated with Barrack about the opposition of the UAE to a proposed summit at Camp David to address an ongoing dispute between the State of Qatar, the UAE and other Middle Eastern governments, after which Barrack sought to advise the President of the United States against holding the Camp David summit.  The summit never happened.

In furtherance of the alleged criminal conspiracy and conduct, Barrack and Grimes, with the assistance of Alshahhi, acquired a dedicated cellular telephone and installed a secure messaging application to facilitate Barrack’s communications with senior UAE officials.

Neither Alshahhi, nor Barrack nor Grimes provided the required notification to the United States Attorney General that they were acting in the United States as agents of a foreign government.

On June 20, 2019, Barrack voluntarily met with FBI special agents.  During the interview, Barrack allegedly made numerous false statements, including falsely denying that Alshahhi had ever requested that he take any actions on behalf of the UAE.

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

The government’s case is being handled by the Office’s Public Integrity Section.  Assistant United States Attorneys Nathan Reilly, Ryan Harris, Samuel Nitze and Hiral Mehta of the Eastern District of New York and Trial Attorney Matthew McKenzie from the Justice Department’s Counterintelligence and Export Control Section are in charge of the prosecution.

The Defendants:

RASHID SULTAN RASHID AL MALIK ALSHAHHI (also known as “Rashid Al Malik” and “Rashid Al‑Malik”)
Age:  43
United Arab Emirates

THOMAS JOSEPH BARRACK
Age:  74
Santa Monica, California

MATTHEW GRIMES
Age:  27
Aspen, Colorado

E.D.N.Y. Docket No. 21-CR-371 (BMC)

A seven-count indictment was unsealed today in a New York federal court relating to the defendants’ unlawful efforts to advance the interests of the United Arab Emirates (UAE) in the United States at the direction of senior UAE officials by influencing the foreign policy positions of the campaign of a candidate in the 2016 U.S. presidential election and, subsequently, the foreign policy positions of the U.S. government in the incoming administration, as well as seeking to influence public opinion in favor of UAE interests.

Thomas Joseph Barrack, 74, of Santa Monica, California; Matthew Grimes, 27, of Aspen, Colorado; and Rashid Sultan Rashid Al Malik Alshahhi, aka Rashid Al Malik and Rashid Al‑Malik, 43, a UAE national, are accused of acting and conspiring to act as agents of the UAE between April 2016 and April 2018. The indictment also charges Barrack with obstruction of justice and making multiple false statements during a June 20, 2019, interview with federal law enforcement agents.

“The defendants repeatedly capitalized on Barrack’s friendships and access to a candidate who was eventually elected President, high-ranking campaign and government officials, and the American media to advance the policy goals of a foreign government without disclosing their true allegiances,” said Acting Assistant Attorney General Mark Lesko of the Justice Department’s National Security Division. “The conduct alleged in the indictment is nothing short of a betrayal of those officials in the United States, including the former President. Through this indictment, we are putting everyone — regardless of their wealth or perceived political power — on notice that the Department of Justice will enforce the prohibition of this sort of undisclosed foreign influence.” 

“As alleged, the defendants, using their positions of power and influence in a presidential election year, engaged in a conspiracy to illegally advance and promote the interests of the United Arab Emirates in this country, in flagrant violation of their obligation to notify the Attorney General of their activities and in derogation of the American people’s right to know when a foreign government seeks to influence the policies of our government and our public opinion,” said Acting U.S. Attorney Jacquelin M. Kasulis for the Eastern District of New York. “These arrests serve as a warning to those who act at the direction of foreign governments without disclosing their actions, as well as those who seek to mislead investigators about their actions, that they will be brought to justice and face the consequences.”

“Today’s indictment confirms the FBI’s unwavering commitment to rooting out those individuals who think they can manipulate the system to the detriment of the United States and the American people,” said Assistant Director Calvin Shivers of the FBI's Criminal Investigative Division. "Barrack is alleged to have abused his access to government officials to illegally advance the interests of foreign governments. The FBI stands in concert with our external partners to ensure all who seek to wield illegal influence are charged for their crimes.”

“American citizens have a right to know when foreign governments, or their agents, are attempting to exert influence on our government,” said Assistant Director in Charge William F. Sweeney Jr. of the FBI’s New York Field Office. “This is especially important to Americans during a presidential election year, and the laws on the books were created to protect our nation from such untoward influence. This case is about secret attempts to influence our highest officials, and when that corrupt behavior was discovered, we allege Mr. Barrack went even further, obstructing and lying to FBI special agents. In case it needs repeating, each of those bad choices is a federal felony, and each now comes with significant consequences – the first being today’s indictment.”

According to court documents, between April and November 2016, Barrack served as an informal advisor to the campaign of the candidate in the 2016 U.S. presidential election. Between November 2016 and January 2017, Barrack served as Chairman of the Presidential Inaugural Committee. Beginning in January 2017, Barrack informally advised senior U.S. government officials on issues related to U.S. foreign policy in the Middle East. Barrack also sought appointment to a senior role in the U.S. government, including the role of Special Envoy to the Middle East. Barrack served as the Executive Chairman of a global investment management firm headquartered in Los Angeles, and Grimes was employed at the firm and reported directly to Barrack. During the relevant time period, Alshahhi worked as an agent of the UAE and was in frequent contact with Barrack and Grimes, including numerous in-person meetings in the United States and the UAE.

As alleged in the indictment, the defendants used Barrack’s status as a senior outside advisor to the campaign and, subsequently, to senior U.S. government officials, to advance the interests of and provide intelligence to the UAE while simultaneously failing to notify the Attorney General that their actions were taken at the direction of senior UAE officials. Barrack – directly and through Alshahhi and Grimes – was regularly and repeatedly in contact with the senior leadership of the UAE government. On multiple occasions, Barrack referred to Alshahhi as the UAE’s “secret weapon” to advance its foreign policy agenda in the United States.

Barrack, Alshahhi and Grimes allegedly took numerous steps in the United States to advance the interests of the UAE. For example, in May 2016, Barrack inserted language praising the UAE into a campaign speech to be delivered by the candidate about U.S. energy policy in May 2016 and emailed an advance draft of the speech to Alshahhi for delivery to senior UAE officials. Similarly, throughout 2016 and 2017, the defendants sought and received direction and feedback, including talking points, from senior UAE officials in connection with national press appearances Barrack used to promote the interests of the UAE. After one appearance in which Barrack repeatedly praised the UAE, Barrack emailed Alshahhi, “I nailed it. . . for the home team,” referring to the UAE. Barrack and Grimes also solicited direction from senior UAE officials in advance of the publication of an op-ed authored by Barrack and published in a national magazine in October 2016 and removed certain language at the direction of senior UAE officials, as relayed by Alshahhi.

Following the 2016 U.S. presidential election, the defendants repeatedly acted at the direction of UAE officials to influence the foreign policy positions of the incoming administration in favor of UAE interests. For example, in December 2016, Barrack attended a meeting with Grimes, Alshahhi and senior UAE government officials, during which he advised them to create a “wish list” of U.S. foreign policy items that the UAE wanted accomplished in the first 100 days, six months, year and four years of the incoming administration of the U.S. President-elect.

In March 2017, Barrack and his co-defendants agreed to promote the candidacy of an individual favored by senior UAE officials for the position of U.S. Ambassador to the UAE. In May 2017, Barrack agreed to provide Alshahhi with non-public information about the views and reactions of senior U.S. government officials following a White House meeting between senior U.S. officials and senior UAE officials.

In September 2017, Alshahhi communicated with Barrack about the opposition of the UAE to a proposed summit at Camp David to address an ongoing dispute between the State of Qatar, the UAE and other Middle Eastern governments, after which Barrack sought to advise the President of the United States against holding the Camp David summit. The summit never happened.

In furtherance of the alleged criminal conspiracy and conduct, Barrack and Grimes, with the assistance of Alshahhi, acquired a dedicated cellular telephone and installed a secure messaging application to facilitate Barrack’s communications with senior UAE officials.

Neither Alshahhi nor Barrack nor Grimes provided the required notification to the U.S. Attorney General that they were acting in the United States as agents of a foreign government.

On June 20, 2019, Barrack voluntarily met with FBI special agents. During the interview, Barrack allegedly made numerous false statements, including falsely denying that Alshahhi had ever requested that he take any actions on behalf of the UAE.

Barrack and Grimes were arrested this morning and are scheduled to be arraigned this afternoon in the Central District of California. Alshahhi remains at large.

Assistant U.S. Attorneys Nathan Reilly, Ryan Harris, Samuel Nitze and Hiral Mehta of the Eastern District of New York and Trial Attorney Matthew McKenzie of the National Security Division’s Counterintelligence and Export Control are prosecuting the case.

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

Henry Edenilson Salmeron, a member of the violent transnational criminal organization La Mara Salvatrucha, also known as the “MS-13,” and fugitive from justice, was extradited from Guatemala to the United States yesterday to face charges for his alleged participation in the April 11, 2017 murders of Justin Llivicura, Michael Lopez, Jorge Tigre and Jefferson Villalobos.  Salmeron, who was originally charged in an indictment returned by a federal grand jury in Central Islip, New York, on July 12, 2017, was arrested in Guatemala City, Guatemala, on February 3, 2021, by the Transnational Anti-Gang (TAG) Unit on a provisional arrest warrant, and has been detained since then, pending his extradition to the United States.  Salmeron was arraigned this afternoon before United States Circuit Judge Joseph F. Bianco and was ordered detained pending trial.

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), Vincent F. DeMarco, United States Marshal for the Eastern District of New York, and Stuart J. Cameron, Acting Commissioner, Suffolk County Police Department (SCPD), announced the arrest and extradition.

“Although this defendant sought to evade answering for these horrific crimes by fleeing more than 3,000 miles from the Central Islip park where he and his fellow MS-13 gang members callously slaughtered four young men, the relentless determination of our law enforcement partners led to his capture and extradition, and he will now face justice in a courthouse that overlooks that very same park,” stated Acting U.S. Attorney Kasulis.  “More than four years have passed since the victims were murdered, but we hope that today’s extradition brings some measure of comfort to the victims’ family and friends.”  Acting U.S. Attorney Kasulis expressed her grateful appreciation to the investigators and analysts of the FBI’s Guatemala TAG Unit and Safe Streets Gang Unit, the members of the FBI’s Long Island Gang Task Force, and the United States Marshals Service (USMS) for their outstanding collaboration in locating and apprehending this fugitive.  Ms. Kasulis also expressed thanks to Homeland Security Investigations (HSI) and the Department of Justice’s Office of International Affairs for their assistance in this case. 

“Gang violence erodes the very fabric of our communities, in many cases leaving parents to fear for the lives of their children, and the average citizen to doubt their safety in the comfort of their own neighborhood,” stated FBI Assistant Director-in-Charge Sweeney.  “Today’s extradition of Salmeron will now allow us to hold him accountable for the murders he’s accused of committing, and hopefully restore some faith in the community that we, too, share the same concerns and won’t stop pursuing these criminals until they all face justice for their crimes.”

“Criminals often think they can flee the United States to avoid prosecution but United States Marshals Service is determined to work with our federal and international law enforcement partners and give victims of violent crime the justice they deserve,” stated United States Marshal DeMarco.

“The extradition of violent criminals like Henry Edenilson Salmeron sends a clear and powerful message to members of MS-13 that gang activity will not be tolerated in Suffolk County,” stated SCPD Acting Commissioner Cameron.  “I commend our law enforcement partners, both here and in Guatemala, for their dedication to apprehending Salmeron and bringing him back to Suffolk County to answer for these crimes and bring justice to the victims’ families.”

On the evening of April 11, 2017, two female associates of the MS-13 lured five young men, including Llivicura, Lopez, Tigre and Villalobos, to a community park in Central Islip, so that Salmeron and other MS-13 members and associates could attack and kill them.  The victims were believed to be rival gang members who were disrespectful toward the MS-13.  Salmeron and numerous other MS-13 members and associates met in the park where they distributed weapons and discussed the plan to kill the victims.  Once the female MS-13 associates led the men to a wooded area, Salmeron and the other MS-13 members and associates surrounded, attacked and killed Llivicura, Lopez, Tigre and Villalobos, using machetes, knives, wooden clubs and an axe.  The fifth intended victim escaped.  The victims’ bodies were discovered the following evening.

After committing the murders, Salmeron fled to Guatemala to evade arrest and prosecution in this case.  Salmeron remained a fugitive for nearly four years until he was located by the USMS and FBI, and arrested by the TAG in Guatemala City on February 3, 2021.  The United States requested Salmeron’s extradition, and his formal surrender was authorized on May 10, 2021, so that he could be transported to the Eastern District of New York to face the charges pending against him. 

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

Salmeron is the ninth MS-13 member or associate to be charged publicly with the April 11, 2017 murders.  Six of those defendants are pending trial and are presumed innocent until proven guilty.  Josue Portillo and Freiry Martinez previously pleaded guilty and were sentenced to 55 and 50 years in prison, respectively.

Today’s extradition is the latest achievement 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, Mexico, Guatemala and Honduras, but the gang has thousands of members across the United States, comprised primarily of immigrants from Central America.  With numerous branches, or “cliques,” the MS-13 is the most violent street 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, comprising agents and officers of the FBI, the Nassau County Police Department (NCPD), the SCPD, the Nassau County Sheriff’s Department, the Suffolk County Sheriff’s Office, the Suffolk County Probation 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:

HENRY EDENILSON SALMERON
Age: 22
Guatemala City, Guatemala; formerly of Brentwood, New York

E.D.N.Y. Docket No. 16-CR-403 (JFB)

Earlier today, in federal court in Central Islip, Jerlin Villalta, a member of the Freeport Locos Salvatruchas (FLS) 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 25 years’ imprisonment for racketeering, including predicate acts relating to his participation in the June 3, 2016 murder of Jose Pena and a conspiracy to distribute marijuana.  Villalta pleaded guilty to the charges in October 2018.

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, William F. Sweeney, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Stuart Cameron, Acting Commissioner, Suffolk County Police Department (SCPD), announced the sentence.

“Today’s sentence holds the defendant to account for his vicious stabbing of the victim who was killed for violating the depraved rules of the MS-13.  It is fitting that the defendant spend decades behind bars for his participation in this cruel and intentional taking of a human life,” stated Acting U.S. Attorney Kasulis.  “This Office, in partnership with the Long Island Gang Task Force, will not rest until the MS -13 gang and its violence is eliminated from our communities.”

“This sentencing will ensure that another member of MS-13, who took part in a violent, senseless murder, will be imprisoned for his actions,” stated SCPD Acting Commissioner Cameron. “The department’s incredible partnership with the FBI’s Long Island Gang Task Force and Eastern District of New York allows gang members, like Villalta, to be held accountable –while sending a message to gang leadership that we will not waver until gang violence is eradicated. I commend all the law enforcement officers, whose countless hours and dedication ensured a successful conclusion on this case.”

In 2016, Villalta and several co-conspirators, including Carlos Argueta and Elmer Alexander Lopez, decided to kill Pena, a member of the MS-13, because he was suspected of violating gang rules.  Prior to the murder, Villalta, Argueta, Lopez and other MS-13 members held meetings to discuss killing Pena because they suspected that Pena had cooperated with law enforcement following his arrest in connection with his participation in the attempted murder of suspected rival gang members outside a public library in Brentwood on or about January 15, 2016, and also that Pena might be homosexual.  After consulting with MS-13 leadership in El Salvador, Villalta, Argueta, Lopez and the other MS-13 members agreed to murder Pena and tasks were assigned to each of the co-conspirators to carry out the plan, including obtaining weapons and a vehicle to be used in the murder.  On June 3, 2016, Villalta, Argueta, Lopez and the other MS-13 members lured Pena into a car and drove to a secluded wooded area in Brentwood on the grounds of an abandoned psychiatric hospital, where they attacked Pena, stabbing and slashing him with knives until he was dead.  Pena’s body was discovered four months after his murder.  Argueta and Lopez previously pled guilty to racketeering charges in connection with the Pena murder.  In December 2018, Lopez was sentenced to 300 months’ imprisonment.  Argueta is awaiting sentencing.

Villalta also pleaded guilty to participating in a drug conspiracy, admitting that between January 2016 and December 2016, he and other members of the FLS conspired to distribute marijuana to raise money for the MS-13.

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, comprised primarily of immigrants from Central America.  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:

JERLIN VILLALTA (also known as “Sonic”)
Age: 24 
Brentwood, New York

E.D.N.Y. Docket No. 16-CR-403 (S-6)(JFB)

An indictment was returned in federal court in Brooklyn yesterday charging Pushpesh Kumar Baid, also known as “PK Jain,” with wire fraud conspiracy and aggravated identity theft relating to a scheme to defraud investors in an international factoring company (the “Company”) of more than $30 million.  Baid, the former Business Head of the Company, was previously arrested in January 2021 on a criminal complaint and will be arraigned on the indictment at a later date.

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Thomas Fattorusso, Acting Special Agent-in-Charge, Internal Revenue Service-Criminal Investigation (IRS-CI), announced the indictment.

“As alleged, Baid and his co-conspirators actively misled investors about the nature, operation and investment strategy of an international factoring company, which caused more than $30 million in losses,” stated Acting United States Attorney Kasulis.  “This Office will vigorously prosecute defendants like Baid who commit fraud as part of a scheme to enrich themselves at their investors’ expense.”

“As alleged, Baid and his co-conspirators used lies and material misrepresentations to defraud an investment firm responsible for managing funds on behalf of dozens of investors.  When the scheme ultimately failed, the investment firm faced losses in excess of $30 million.  As today’s action should demonstrate, we are committed to bringing to justice those whose greed leads them to commit criminal financial fraud,” stated FBI Assistant Director-in-Charge Sweeney.   

“Regardless of how sophisticated the scheme or what it is called, simply put, Baid stole millions of dollars from his clients who put their trust in him,” stated IRS-CI Special Agent-in-Charge Fattorusso.  “Criminal investigators of the IRS operate worldwide specializing in tracing the money to uncover elaborate criminal enterprises.” 

Factoring involves the sale of an invoice to a third-party for a discount. In a factoring transaction, the seller of an invoice obtains immediate funding from a buyer, and the buyer of an invoice makes a profit when the invoice is paid in full. The Company purported to be in the business of buying invoices.

As set forth in court filings, Baid was the Business Head of the Company, which purported to be involved in factoring.  The Company represented itself as an international factoring business run by an executive team experienced in factoring invoices in particular industries and geographic regions.  Between approximately April 2017 and October 2019, Baid and others at the Company conspired to defraud an investment firm (the “Investment Firm”), which made investments on behalf of approximately 50 investors.  Specifically, Baid and his co-conspirators induced the Investment Firm to invest millions of dollars in the Company through a series of material misrepresentations about the individuals who purportedly operated the Company; the nature of the Company’s business; the relationship between the Company and the entities with which it was purportedly factoring invoices; and the ways in which investor funds would be used.  In July 2019, the Investment Firm stopped receiving payments on invoices that it had factored through the Company, and ultimately suffered more than $30 million in losses related to those invoices.  In April 2020, the Investment Firm filed for bankruptcy.

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

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

The Defendant:

PUSHPESH KUMAR BAID (also known as “PK Jain”)
Age:  40
Miami, Florida

E.D.N.Y. Docket No. 21-CR-367 (MKB)

A criminal complaint was unsealed today in federal court in Brooklyn charging United States Postal Service (USPS) worker Jaleesa Wallace with stealing blank postal money orders and unemployment benefits cards.  Wallace was arrested this morning and her initial appearance is scheduled for this afternoon before United States Magistrate Judge James R. Cho.  On July 9, 2021, Willie Cook, an alleged co-conspirator, was arrested for stealing USPS money orders in connection with the scheme. Cook was released on a $25,000 bond.

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, Matthew Modafferi, Special Agent-in-Charge, USPS, Office of the Inspector General (USPS-OIG), and Dermot F. Shea, Commissioner, New York City Police Department (NYPD), announced the charges.

“As alleged, the defendant, a trusted public servant, pilfered thousands of postal money orders from the Postal Service and had in her possession Department of Labor unemployment benefit cards, giving her and her co-conspirator access to more than $3 million in cash,” stated Acting United States Attorney Kasulis.  “This Office will vigorously prosecute government employees who exploit their positions for personal gain and abuse the public trust.”  Ms. Kasulis expressed her gratitude to the investigators of the U.S. Postal Inspection Service, the USPS-OIG and NYPD for their outstanding work on the case.

“The Special Agents of the U.S. Postal Service Office of Inspector General help to maintain the integrity of the Postal Service and its personnel. When a Postal Service employee breaks the trust of the American public and participates in schemes to defraud the government, our Agents will work tirelessly to help bring those responsible to justice. We’d like to thank the U.S. Postal Inspection Service, New York Police Department, and the U.S. Attorney’s office for our strong relationships and their dedication to supporting our mission,” stated USPS-OIG Special Agent-in-Charge Modafferi.

As set forth in court filings, in February 2021, 10,000 blank postal money orders were reported missing from the Utica Avenue Post Office in Brooklyn.  The postal money orders can be deposited with a financial institution for up to $1,000 each.  On July 9, 2021, agents executed search warrants and recovered over 3,000 of the stolen postal money orders from Wallace’s residence and approximately 300 from Cook’s residence.  At least $1.4 million worth of the stolen postal money orders had been cashed. Agents also recovered prepaid Department of Labor unemployment benefit cards and over $42,000 in cash from both apartments.  Additionally, Wallace was in possession of approximately 42 pieces of mail from the Department of Labor that were not in her name.  Cook posted photos of stolen postal money orders on the social media app Telegram with the caption “let’s eat,” referring to getting paid for the postal money orders.  Cook is not a USPS employee.

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

The government’s case is being handled by the Office’s General Crimes Section.  Assistant United States Attorney Samantha Alessi is in charge of the prosecution with assistance from Assistant United States Attorneys Garen Marshall and Dylan Stern.  

The Defendants:

JALEESA WALLACE
Age: 30
Brooklyn, New York

E.D.N.Y. Docket No. 21-MJ-808

WILLIE COOK
Age: 34
Brooklyn, New York

E.D.N.Y. Docket No. 21-MJ-802

Earlier today, at the federal courthouse in Brooklyn, Joseph Miner was sentenced by United States District Judge William F. Kuntz, II, to 57 months’ imprisonment for purchasing an illegally defaced firearm in May 2020.

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, and William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the sentence.

“Today’s sentence holds Miner accountable for his knowing purchase of a firearm that could not be traced because its serial number had been removed,” stated Acting U.S. Attorney Kasulis.  “I commend the swift action taken by members of law enforcement to address the serious threat that possession of illegal guns poses to the safety of the community.”

Law enforcement authorities began investigating Miner’s interest in illegally purchasing firearms in late 2019, when he posted on social media his desire to obtain assault weapons and other firearms for a racial civil war or racial holy war.  Miner expressed support on social media for racially and ethnically motivated violence, including celebrating the August 2017 white supremacist rally in Charlottesville, Virginia, and the December 2019 machete attack at a synagogue in Monsey, New York.  Although Miner at times disavowed interest in conducting an attack himself, on multiple occasions he posted social media messages in which he displayed suicidal ideations and fantasized about “martyring” himself and “go[ing] out in a blaze of glory” in a mass-shooting attack.

In April 2020, Miner initiated contact with an undercover law enforcement agent posing as a firearms dealer.  Miner requested to purchase firearms from the undercover agent, knowing that the serial numbers that allow the weapons to be traced were removed from the guns that the undercover agent was offering for sale.  Following further communications to set up the gun purchase, Miner and a co-defendant met the undercover agent at a Queens hotel on the evening of May 12, 2020.  Miner purchased a Glock 9mm handgun with an obliterated serial number.

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

The Defendant:

JOSEPH MINER
Age:  31
Bayside, Queens

E.D.N.Y. Docket No. 21-CR-554 (WFK)

Earlier today, in federal court in Central Islip, Lorraine Chalavoutis pleaded guilty before United States District Judge Joanna Seybert to conspiracy to commit mail fraud by participating in a scheme to mail fraudulent prize notices that induced recipients, many of whom were elderly and vulnerable, to believe that they could claim large cash prizes in exchange for a modest fee.  None of the victims who submitted fees, which in total exceeded $30 million, received a substantial cash prize.  When sentenced, Chalavoutis faces up to 20 years in prison, as well as forfeiture and a fine. 

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, Brian M. Boynton, Acting Assistant Attorney General for the Justice Department’s Civil Division, and Philip R. Bartlett, Inspector-in-Charge, United States Postal Inspection Service, New York Division (USPIS), announced the guilty plea.

“With today’s plea, Chalavoutis has admitted her role in a nefarious and fraudulent scheme to enrich herself by tricking elderly and vulnerable victims into believing they had won a cash prize that they could collect after paying her modest fees,” stated Acting United States Attorney Kasulis.  “Protecting the community from those who commit fraud to deliberately prey on the false hopes of the vulnerable remains a priority of this Office and the Department of Justice.”

“Chalavoutis set up and ran the administrative and financial operations that allowed this fraud scheme to work,” stated Acting Assistant Attorney General Boynton. “The Department of Justice is committed to protecting elderly and vulnerable Americans and to prosecuting those who defraud them.”

“Today’s plea is an example of the coordinated efforts of law enforcement to bring those to justice who prey on vulnerable adults through the distribution of bogus solicitations, luring the unsuspecting ‘prize winner’ to send money in an effort to steal not only their money, but in many cases their independence,” stated USPIS  Inspector-in-Charge Bartlett.

Between December 2010 and July 2016, Chalavoutis conspired to mail fraudulent prize notices to thousands of victims throughout the United States.  The mailings appeared to be personally addressed to thousands of individuals whose names were on consumer lists obtained by Chalavoutis and her primary co-conspirators, Shaun Sullivan and Tully Lovisa.  Chalavoutis created various shell companies for the purported senders of the mailings and hid her co-conspirators’ involvement in the business by using straw owners.  Lovisa and Sullivan previously pleaded guilty to conspiracy to commit mail fraud and are awaiting sentencing.  In separate cases, several other defendants have also pleaded guilty to conspiracy to commit mail fraud in connection with the scheme.

The government’s case is being prosecuted by Assistant United States Attorney Charles P. Kelly and Trial Attorneys Daniel Zytnick and Timothy Finley of the Justice Department’s Consumer Protection Branch.  Assistant United States Attorney Tanisha R. Payne of the Office’s Civil Division is in charge of forfeiture matters.

The Defendant:

LORRAINE CHALAVOUTIS
Age:  64
Greenlawn, New York

E.D.N.Y. Docket No. 18-CR-349 (JS)

A New York man who allegedly hurled racial slurs at a police officer has been charged with a gun crime, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.

Shermaine Laster, 46, was arrested at John F. Kennedy International Airport on June 25, charged via criminal complaint with possession of a firearm by a felon. A federal grand jury in Dallas indicted him on the same charge on Thursday.

According to the complaint, travel records indicate that Mr. Laster, a convicted felon, flew from New York to Dallas to visit a local gun range, where he allegedly fired a 7.62x39 caliber rifle.

Prior to shooting the weapon, he allegedly signed a “Firearms Eligibility Experience & Range Safety Waiver,” which reminded signatories that “it is unlawful for a felon or illegal alien to possess or rent firearms or ammunition.” When the form asked if he’d ever been convicted of a felony, Mr. Laster indicated he had not.  

In a video recorded at the gun range and later posted to Instagram, the defendant allegedly fired several rounds at paper targets, noting, “I’m going to be demonstrating how to take out your opponent.” A review of the Instagram feed revealed numerous photographs of handguns, with captions like “I’m ready for WAR,” “No games… fight in the dark,” and “Black Power.”

At a detention hearing in the Eastern District of New York, prosecutors introduced into evidence multiple images of Mr. Laster brandishing firearms as well as a now-viral video of Mr. Laster allegedly hurling racial slurs at an Asian-American NYPD officer in Washington Square Park.

Like all defendants, Mr. Laster is presumed innocent until proven guilty in a court of law. If convicted, he faces up to ten years in federal prison.

The Federal Bureau of Investigation’s North Texas Joint Terrorism Taskforce and the New York Police Department conducted the investigation. Assistant U.S. Attorney Melanie Smith of the Northern District of Texas is prosecuting the case with the assistance of Assistant U.S. Attorneys Francisco Navarro and Chand Edwards-Balfour of the Eastern District of New York.

Earlier today, Ryan Behar pleaded guilty in federal court in Brooklyn to transferring obscene material to a minor and to committing that offense while required by state law to register as a sex offender.  The proceeding took place before United States District Judge Rachel P. Kovner.  When sentenced, Behar faces a statutory minimum sentence of 10 years’ imprisonment. 

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, announced the guilty plea.

“The defendant, a registered sex offender, admits to victimizing a 12-year-old girl by misrepresenting himself as a teenager on social media and sending her obscene, sexually explicit material,” stated Acting U.S. Attorney Kasulis. “Protecting children from predators like the defendant will always be a priority of this Office.  The defendant’s conduct should serve as a reminder to parents of the dangers that may be lurking online.”  Ms. Kasulis expressed her grateful appreciation to the Federal Bureau of Investigation, New York Field Office (FBI), and the FBI’s Human Trafficking and Child Exploitation Task Force for their work on the case.

As set forth in court filings and today’s court proceeding, in October 2020, while misrepresenting himself on Instagram to be a teenage boy, Behar, then 41 years old, contacted the victim and asked her age.  The victim responded that she was 12 years old, provided an image of a young girl and stated, “This is what I look like.”  Behar repeatedly asked the victim to send him images of her body.  When she refused, Behar sent her a graphic image of adult male genitals and wrote to the victim “that’s mine,” and continued to press the victim for “full body” images. 

Behar was previously convicted in February 2018 in Richmond County Supreme Court for attempted dissemination of indecent material to a minor in the first degree after sending sexually explicit material over social media to another female minor victim.  Following that conviction, Behar was required to register with the New York State Division of Criminal Justice Services as a Level 1 sex offender pursuant to the New York Sex Offender Registration Act.

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 General Crimes Section. Assistant United States Attorney Garen S. Marshall is in charge of the prosecution.

The Defendant:

RYAN BEHAR
Age:  42
Staten Island, New York

E.D.N.Y. Docket No. 21-CR-187 (RPK)

A federal jury in Brooklyn today convicted Akmal Narzikulov of all eight counts of a superseding indictment charging him with conspiracy to unlawfully produce identification documents, conspiracy to commit kidnapping, kidnapping, conspiracy to commit Hobbs Act extortion and Hobbs Act extortion relating to a scheme to assist cheating by applicants for commercial driver licenses administered by the New York Department of Motor Vehicles (“DMV”) and licenses issued by the New York City Taxi and Limousine Commission (“TLC”).  Narzikulov was also convicted of using a firearm in connection with the charged extortion and conspiracy to commit witness tampering.  The verdict followed a two-week trial before United States District Judge Brian M. Cogan.

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, announced the verdict.

“With the defendant’s conviction, he is held accountable for a long list of crimes, including conspiring to engage in a brazen cheating scheme, kidnapping, extortion, witness tampering and threatening a co-conspirator at gunpoint,” stated Acting U.S. Attorney Kasulis. “I commend our prosecutors for laying out the detailed road map that led to today’s verdict and for bringing justice to the individuals who were harmed by the defendant’s greed and senseless violence.”  Ms. Kasulis expressed her grateful appreciation to the Federal Bureau of Investigation, New York Field Office, for their outstanding investigative work on the case.

As proven at trial, Narzikulov and other co-conspirators assisted applicants for commercial driver licenses (“CDLs”) in cheating on tests administered by the DMV in exchange for cash.  Using wireless communication devices hidden inside the applicants’ clothing, Narzikulov’s co-conspirators transmitted the correct answers to earbuds used by the applicants as they took written exams at various DMV locations.  For example, after making the illicit payment to the defendant and his co-conspirators, the license applicant was provided a T-shirt with a tiny hole cut out in the middle.  A smartphone was attached inside the shirt with the camera aimed through the hole so the co-conspirators could view the test questions and send the answers to the applicant. The defendant and his co-conspirators used the same method to assist applicants in cheating on written tests required to obtain licenses from the TLC.  

On March 28, 2019 in Brooklyn, Narzikulov, co-defendant Sherzod Mukumov and an unapprehended co-conspirator kidnapped an individual (“the Victim”) who had withdrawn from the license cheating scheme.  Surveillance video showed the Victim being shocked and subdued with a taser, and then being dragged to a waiting car by Narzikulov and the co-conspirator. 

On the same night as the kidnapping, Narzikulov threatened another co-conspirator at gunpoint in an attempt to extort money from him and the Victim.

As charged in the second superseding indictment, Narzikulov offered thousands of dollars to key witnesses against him to travel overseas and remain there until after the defendant’s trial was over.  When Narzikulov was arrested in April 2019, FBI special agents recovered a 9mm handgun, approximately $300,000 in cash and numerous identification documents belonging to other individuals from inside a closet in the defendant’s apartment.

In November 2019, Mukumov pleaded guilty to conspiracy to commit kidnapping and is awaiting sentencing.  In January 2020, Jasur Kamolov pleaded guilty to conspiracy to produce false identification documents and is awaiting sentencing.  In November 2020, Murodjon Sultanov pleaded guilty to witness tampering and was sentenced in April 2021 to a term of 24 months’ imprisonment.  In May 2021, Firuz Juraev pleaded guilty to Hobbs Act extortion conspiracy and conspiracy to tamper with witnesses and is awaiting sentencing. 

The government’s case is being handled by the Office’s Public Integrity Section.  Assistant United States Attorney Turner Buford and Special Assistant United States Attorney Virginia Nguyen are in charge of the prosecution with assistance from paralegal Shivani Parshad.

The Defendants:

AKMAL NARZIKULOV
Age:   37
Brooklyn, New York

E.D.N.Y. Docket No. 19-CR-223 (BMC)

BROOKLYN, NY – Yesterday, in federal court in Brooklyn, Shmuel Gali was sentenced by United States District Judge Kiyo A. Matsumoto to 60 months’ imprisonment for his role in a long-running odometer tampering and money laundering scheme, and ordered to pay $3,936,000 in restitution.  The defendant pleaded guilty in August 2020 to conspiracy to commit money laundering, conspiracy to commit odometer tampering, making false odometer statements and securities fraud.

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, Brian M. Boynton, Acting Assistant Attorney General of the Justice Department’s Civil Division, and Thomas Fattorusso, Acting Special Agent-in-Charge, Internal Revenue Service-Criminal Investigation (IRS-CI), announced the sentence.

“The sentence sends a warning that this Office will prosecute those who engage in odometer tampering and deliberately dupe consumers into unknowingly paying inflated prices for their motor vehicles,” stated Acting U.S. Attorney Kasulis. “With the defendant being sentenced to prison and ordered to pay restitution to his victims, he is being held to account for his greed in contriving this fraudulent scheme.”

“An automobile is one of the biggest purchases many consumers make,” stated Acting Assistant Attorney General Boynton. “Misrepresenting used car mileages defrauds buyers and hides important information concerning safety and reliability. The Department of Justice will continue to work with law enforcement partners to prosecute odometer fraud.”

“Automobile sales stand as one of the pillars of the American economy requiring transparency and integrity,” stated Acting IRS-CI Special Agent-in-Charge Fattorusso.  “The financial expertise of IRS-CI was needed to uncover this criminal enterprise perpetuated by Shmuel Gali who received a just sentence relative to his criminal activity.”

Between 2006 and June 2011, Shmuel Gali, while conspiring with his brother Chaim, defrauded buyers of used motor vehicles by misrepresenting the mileage of approximately 690 vehicles that they sold. They used fictitious dealer names to purchase high mileage, used motor vehicles from a national vehicle leasing company, altered the odometers of the vehicles to reflect false, lower mileages, and then sold the vehicles at wholesale automobile auctions. On average, the odometers on the vehicles were rolled back by close to 70,000 miles.  Consumers who purchased the vehicles at dealerships did not know the true mileage and paid inflated sales prices. 

This matter was investigated by the U.S. Department of Transportation National Highway Traffic Safety Administration (NHTSA) Office of Odometer Fraud Investigation, and the Internal Revenue Service-Criminal Investigation.

Assistant United States Attorney Catherine M. Mirabile of the Eastern District of New York and Senior Litigation Counsel Linda I. Marks of the Civil Division’s Consumer Protection Branch prosecuted the case.

The Defendant:

SHMUEL GALI (also known as “Sam Gali”)
Age:  48
Brooklyn, New York; Israel

E.D.N.Y. Docket No. 14-CR-652 (KAM)

Amec Foster Wheeler Energy Limited (“Amec Foster Wheeler,” or the “Company”), a subsidiary of John Wood Group plc (“Wood”), a United Kingdom-based global engineering company, has agreed to pay a penalty of more than $18 million to resolve charges stemming from the Company’s involvement in a scheme to pay bribes to foreign officials in Brazil in exchange for an approximately $190 million contract to design a gas-to-chemicals complex. 

Earlier today, in federal court in Brooklyn, Amec Foster Wheeler entered into a three-year deferred prosecution agreement (“DPA”) with the U.S. Attorney’s Office for the Eastern District of New York and the Department of Justice’s Criminal Division, Fraud Section in connection with the filing of a criminal information filed in the Eastern District of New York charging the Company with conspiracy to violate the anti-bribery provisions of the Foreign Corrupt Practices Act (“FCPA”).  In related proceedings, the Company has received provisional court approval for a settlement with the United Kingdom’s Serious Fraud Office and has settled with the Ministério Público Federal (“MPF”), the Advogado-Geral da União (“AGU”), and the Controladoria-Geral da União (“CGU”) in Brazil.  A subsidiary of Wood has also agreed to resolve a related civil matter with the U.S. Securities and Exchange Commission (“SEC”). 

Jacquelyn M. Kasulis, Acting U.S. Attorney for the Eastern District of New York, Nicholas L. McQuaid, Acting Assistant Attorney General of the Justice Department’s Criminal Division, and Steven M. D’Antuono, Assistant Director-in-Charge, Federal Bureau of Investigation, Washington Field Office (FBI), made the announcement.

“Amec Foster Wheeler conspired to pay bribes to officials in Brazil as part of a corrupt scheme to obtain a $190 million government contract and generate millions of dollars in profits,” stated Acting U.S. Attorney Kasulis.  “The defendant’s lengthy DPA and agreement to pay a penalty of more than $18 million demonstrate the commitment of this Office to enforcing the anti-bribery provisions of the FCPA and holding companies like Amec Wheeler Foster accountable for its illegal conduct and corporate greed.”

“Amec Foster Wheeler has now admitted to paying bribes in Brazil to win a lucrative contract,” said Acting Assistant Attorney General McQuaid of the Justice Department’s Criminal Division. “In the pursuit of profits, the company resorted to corruption, which distorts markets and undermines the rule of law. Today’s resolution, including the financial penalty and agreement to enhance compliance, underscores the Department of Justice’s commitment to holding companies accountable when they break the law and to rooting out criminal misconduct.”

“Today’s announcement demonstrates the FBI’s dedication to work with our international partners in the global effort to hold individuals and companies accountable who believe corruption is the only way to do business,” stated FBI Assistant Director-in-Charge D’Antuono.  “When companies like Amec Foster Wheeler attempt to cheat the system, it creates an uneven playing field for businesses who don’t pay bribes. This deferred prosecution agreement, which includes both a substantial criminal penalty and other provisions, should serve as a warning to companies that even using a third-party intermediary to pay bribes will not preclude them from being held responsible for international corruption.”

According to the Company’s admissions and court documents, between 2011 and 2014, Amec Foster Wheeler conspired with others, including an Italian sales agent affiliated with a Monaco-based intermediary company, to pay bribes to decision-makers at Petróleo Brasileiro S.A. (“Petrobras”) in order to win a lucrative contract, worth approximately $190 million, from Petrobras to design a gas-to-chemicals complex in Brazil called Complexo Gás-Químico UFN-IV.  The Company, through certain of its employees and agents, took acts in furtherance of the scheme while located in New York and Texas, and earned at least $12.9 million in profits from the corruptly obtained business.

As part of the DPA, for a three-year period, Amec Foster Wheeler agreed to continue to cooperate with the U.S. government in any ongoing or future criminal investigations concerning Amec Foster Wheeler, its executives, employees or agents.  In addition, Amec Foster Wheeler and its parent company, Wood, agreed to enhance their compliance programs and to report to the government on the implementation of those programs.

The government reached this resolution with Amec Foster Wheeler based on a number of factors, including the Company’s failure to voluntarily and timely disclose the conduct that triggered the investigation, the nature and seriousness of the offense, which spanned multiple years and involved a high level executive, and credit for the Company’s cooperation.  The Company also engaged in remedial measures, including terminating the individuals involved in the misconduct and adopting heightened controls and anti-corruption procedures.  Accordingly, the criminal penalty reflects a 25 percent reduction off the applicable U.S. Sentencing Guidelines fine for the Company’s full cooperation and remediation.

In related proceedings, the Company also has received provisional court approval for a settlement with the United Kingdom’s Serious Fraud Office and has settled with the MPF, the AGU and the CGU in Brazil.  Under the DPA, the Department will credit up to 25 percent ($4,593,750) of the criminal penalty owed to the United States to payments the Company makes pursuant to the resolution with the United Kingdom’s Serious Fraud Office, and up to 33 percent ($6,125,000) of the criminal penalty owed to the United States to payments the Company makes pursuant to the resolution with  Brazilian authorities. 

In a related civil matter with the SEC, a subsidiary of Wood has agreed to pay the SEC disgorgement and prejudgment interest totaling approximately $22.7 million for the conduct in Brazil. 

The FBI’s Washington Field Office is investigating the case.  Assistant U.S. Attorney Julia Nestor of the Eastern District of New York, Assistant Chief Gerald M. Moody, Jr. and Trial Attorney Dennis Kihm of the Criminal Division’s Fraud Section are prosecuting the case.  The U.K.’s Serious Fraud Office and Brazil’s MPF, AGU, and CGU provided significant assistance.

The Defendant:

Amec Foster Wheeler Energy Limited

E.D.N.Y. Docket No. 21-CR-298 (KAM)

Larry Pagett, the East Coast leader of the Eight Trey Crips street gang, was sentenced today by United States District Judge William F. Kuntz, II to life imprisonment for murdering a member of the rival Folk Nation street gang as part of a gang turf war.  Pagett was convicted by a jury of murder in-aid-of racketeering in October 2018 following an eight-day trial. 

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Dermot F. Shea, Commissioner, New York City Police Department (NYPD), announced the sentence.

“Larry Pagett will deservedly spend the rest of his life behind bars for brazenly committing an execution-style, gang-related murder inside a lounge in Brooklyn,” stated Acting U.S Attorney Kasulis.  “This Office will continue working tirelessly with our law enforcement partners to eradicate the murderous violence of street gangs like the Eight Trey Crips and end their wanton disregard for human life.” 

The Eight Trey Crips were based in and around the Flatbush Gardens housing complex.  The Crips and the Folk Nation, a rival street gang, had been engaged in a deadly feud over territory in Brooklyn for years.  On August 28, 2015, Pagett encountered Chrispine Philip, also known as “Droppa,” inside the Buda Hookah Lounge located on Flatbush Avenue in Brooklyn.  Philip was a member of the rival Folk Nation, and Pagett blamed him for the murder of an Eight Trey Crips gang member in Trinidad in the Spring of 2015.  Pagett pulled out a gun, shot Philip multiple times and ended his life with a final bullet to the back of his head.  A bystander in the crowded nightclub was also shot in the stomach and arm, but survived.  The murder was recorded on video surveillance cameras inside the club. 

The government’s case is being handled by the Office’s Organized Crime and Gangs Section.  Assistant United States Attorneys Patrick T. Hein and Mathew S. Miller are in charge of the prosecution. 

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

The Defendant:

LARRY PAGETT (also known as “Biz,” “Biz Loc” and “Molotovbizzz”)
Age:  41
Brooklyn, New York

E.D.N.Y. Docket No. 17-CR-306 (WFK)

A federal jury in Brooklyn today returned a guilty verdict against Daniel Martin Katz on both counts of an indictment charging him with abusive sexual contact and assault in the special aircraft jurisdiction of the United States.  The verdict followed a three-day trial before United States District Judge Frederic Block.

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, and William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the verdict.

“With today’s verdict, the jury has held the defendant accountable for his unwanted, in-flight assault of a young, vulnerable woman who was sleeping in a darkened aircraft cabin during a transatlantic flight,” stated Acting U.S. Attorney Kasulis.  “This Office will vigorously prosecute reprehensible acts of sexual abuse that take place onboard aircrafts.”

“Today, Mr. Katz learned there are consequences for his outrageous assault of a fellow passenger.  To others who need a quick refresher, here it is:  The FBI's jurisdiction includes any illegal act committed on a plane the moment the doors are closed.  Behave yourselves.  If you break the law while aboard an aircraft, you will be arrested and held accountable,” stated FBI Assistant Director-in-Charge Sweeney.

The government’s evidence at trial established that on February 24, 2018, Katz and the then-25-year-old victim were passengers aboard Etihad Airways Flight 103, an overnight flight traveling from Abu Dhabi, United Arab Emirates, to John F. Kennedy International Airport in Queens, New York.  The victim, assigned to a window seat, fell asleep with Katz assigned to the aisle seat next to her.  While she slept, Katz reached into the victim’s pants with his hand and touched her genitals.  She awoke to the defendant sexually abusing her. 

The government’s case is being prosecuted by Assistant United States Attorneys Kayla C. Bensing and James P. McDonald.

The Defendant:

DANIEL MARTIN KATZ
Age:  36
Brooklyn, New York

E.D.N.Y. Docket No. 19-CR-115 (FB)

Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, announced today the creation of the Environmental Justice Team.  The Environmental Justice Team, comprised of seven Civil Division Assistant U.S. Attorneys, including the Civil Division Chief of Environmental Litigation, reinforces the Office’s focus on protecting the rights of residents of the Eastern District of New York who are disproportionately burdened by environmental and health hazards.  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 approximately eight million people.  

The Office is creating this team in recognition of President Joseph Biden’s directive in Executive Order 14008, which mandates that “[a]gencies shall make achieving environmental justice part of their missions by developing programs, policies, and activities to address the disproportionately high and adverse human health, environmental, climate-related and other cumulative impacts on disadvantaged communities, as well as the accompanying economic challenges of such impacts.”  Among the areas that the Environmental Justice Team will focus on are child lead exposure, clean air, and the protection of groundwater, surface waters, and wetlands across New York City and Long Island.

In announcing the formation of the Environmental Justice Team, Acting United States Attorney Kasulis stated, “I am proud to announce the formation of our Environmental Justice Team, which will enhance the Office’s longstanding commitment to environmental enforcement by addressing disproportionate environmental, health, economic and climate impacts on disadvantaged communities.  The Environmental Justice Team is a critical part of the Office’s longstanding commitment to fighting pollution and climate change. This Office will continue to vigorously enforce federal environmental laws and hold polluters accountable.”

“For too long, the lived experience of many communities whose residents are predominantly of color, Indigenous, or low-income is that they suffer from disproportionately high pollution levels that result in adverse health and environmental impacts,” stated EPA Acting Regional Administrator Walter Mugdan.  “The creation of this Environmental Justice Team is a positive step forward to strengthen the enforcement of our bedrock environmental laws and Title VI of the Civil Rights Act to ensure violations in environmental justice communities are promptly identified and corrected, and that appropriate penalties are imposed as a deterrent against future violations.  Environmental justice is a central driving factor in all that we all do.”

The Office will continue to partner and coordinate with the Environment and Natural Resources Division at the U.S. Department of Justice, as well as client agencies across the federal government. 

The Environmental Justice Team is led by Civil Division Chief of Environmental Litigation Matthew Silverman; the Environmental Justice Team is made up of Senior Litigation Counsel Deborah Zwany and Assistant U.S. Attorneys Ekta R. Dharia, Kathleen Mahoney, Thomas Price, Shana C. Priore and Alex Weinberg.  The Environmental Justice Team is overseen by Civil Division Acting Chief Joseph A. Marutollo and Civil Division Deputy Chief Richard K. Hayes. 

The Office previously announced the creation of a Civil Rights Team in the Office’s Civil Division, which is comprised of the Civil Division Chief of Civil Rights, four Civil Division Assistant U.S. Attorneys, and a Civil Rights investigator.  The Civil Rights Team’s focus will be on protecting the rights of the most vulnerable residents of the Eastern District of New York, especially those in disadvantaged communities. The Environmental Justice Team will be coordinating its work with the Civil Rights Team.

Jacquelyn M. Kasulis has begun serving as Acting United States Attorney for the Eastern District of New York, as per the Vacancies Reform Act.  Ms. Kasulis was sworn in today by Chief Judge Margo K. Brodie, United States District Court Judge for the Eastern District of New York.  Ms. Kasulis was also appointed First Assistant U.S. Attorney as per the Vacancies Reform Act and will continue to hold that position as well.  Ms. Kasulis has served as the Chief Assistant United States Attorney since March 2021.  In that role she has been second-in-command of the U.S. Attorney’s Office and responsible for overseeing the Criminal, Civil, Administrative and Appeals Divisions and the day-to-day operations of the Office, including the Office’s COVID-19 response.  Ms. Kasulis succeeds Mark J. Lesko who will soon be appointed Acting Assistant Attorney General for the Department of Justice’s National Security Division.

“I am honored to serve as the Acting U.S. Attorney for the Eastern District of New York.  After serving as an Assistant U.S. Attorney for over a decade, and overseeing the work of the Criminal and Civil Divisions, I look forward to leading and supporting the men and women of the Office as they work tirelessly with our law enforcement and agency partners to ensure the safety of our community and pursue the cause of justice,” stated Acting U.S. Attorney Kasulis.  “I am especially grateful to the members of the Office for their unwavering commitment to the people of this District and the country during the pandemic, and look forward to assisting the Office as it emerges from the unprecedented challenges of the last year.”

Ms. Kasulis joined the U.S. Attorney’s Office in January 2008 and has served in the General Crimes, Organized Crime, and Business & Securities Fraud Sections. From September 2014 to November 2015, Ms. Kasulis served as Deputy Chief in General Crimes for the Office. She later served as Deputy Chief in the Business & Securities Fraud Section from November 2015 to March 2017 and was appointed Chief of the Business & Securities Fraud Section in March 2017.

Ms. Kasulis began serving as Acting Chief of the Criminal Division in March 2019 and was appointed Chief of the Criminal Division in June 2019. She established and supervised the Office’s Bank Integrity Task Force. She was also selected to be a member of the Department of Justice’s Criminal Chiefs Working Group.

Ms. Kasulis led the Office’s investigation and prosecution of three individuals, including two former Goldman Sachs bankers and a wealthy Malaysian financier, for their participation in a multi-billion dollar money laundering and bribery conspiracy related to 1 Malaysia Development Berhad (lMDB), Malaysia’s investment development fund. In October 2020, Goldman Sachs entered into a three-year deferred prosecution agreement and one of Goldman Sachs’ Malaysian subsidiaries pleaded guilty to a one-count criminal information charging conspiracy to violate the anti-bribery provisions of the Foreign Corrupt Practices Act. As part of that resolution, Goldman Sachs admitted to paying over $1.6 billion in bribes to high-ranking Malaysian and Abu Dhabi officials to obtain lucrative business deals, including underwriting three bond deals between 2012 and 2014 that totaled $6.5 billion, of which $2.7 billion was embezzled. Goldman Sachs agreed to pay $2.9 billion in penalties -- with $1.2 billion paid to the United States Treasury -- as part of a global resolution with eight different foreign and domestic authorities. The Goldman Sachs resolution represents the largest penalty ever paid to U.S. authorities in a foreign bribery case; the most civil and criminal authorities to ever coordinate on any corporate resolution; and the most bribes paid in a foreign bribery scheme prosecuted by the United States.

Ms. Kasulis was the lead Assistant U.S. Attorney in United States v. Martin Shkreli, a high-profile six-week trial in the summer of 2017. Shkreli was charged in four interrelated fraud schemes that resulted in over $20 million in losses to investors, including two fraud schemes related to hedge funds he founded and ran and two additional frauds related to a pharmaceutical company Shkreli founded. Shkreli was convicted of three of the four fraud schemes and sentenced to seven years’ imprisonment.

Additionally, Ms. Kasulis led the investigation and prosecution in United States v. Bandfield, et al., in which 10 defendants and six corporations were charged with orchestrating a massive offshore securities fraud, money laundering and tax evasion schemes. As part of that scheme, the defendants laundered approximately $250 million in securities fraud proceeds and were involved in approximately 40 “pump and dump” schemes. The case represents the first criminal prosecution under the Foreign Account Tax Compliance Act (FATCA).

In United States v. Mitchell, et al., Ms. Kasulis participated in the investigation and prosecution of the Executive Chairman of Forcefield Energy, a NASDAQ-listed company, and nine other individuals -- including five registered broker dealers -- for their role in a $131 million market manipulation scheme involving a network of corrupt investors, stock promoters and broker dealers. In United States v. Peister, Ms. Kasulis led the prosecution and conviction of an investment fund manager who defrauded approximately 75 investors by orchestrating a $17 million Ponzi scheme on Long Island.

During her time in the Organized Crime Section, Ms. Kasulis led the prosecution of over 15 Genovese crime family members and associates in United States v. Depiro, et al., including the conviction of three consecutive International Longshoremen’s Association union presidents for their involvement in a 30-year extortion scheme in which longshoremen were extorted at Christmastime every year at the direction of the Genovese crime family. Ms. Kasulis also led the trial team in United States v. Burke, in which the defendant, a Gambino crime family associate, was convicted of racketeering conspiracy, with predicate acts including two murders, and was sentenced to life imprisonment.

Ms. Kasulis graduated from Columbia Law School in 2003 and received her B.A. in History from Davidson College. After graduation, Jackie worked as a litigation associate for four years at Kirkland & Ellis LLP in New York.

Mark J. Lesko, Acting United States Attorney for the Eastern District of New York, announced today the creation of a Civil Rights Team in the Office’s Civil Division.  The Team, comprised of four Civil Division Assistant U.S. Attorneys and the Civil Division Chief of Civil Rights, enhances the Office’s focus on protecting the rights of the most vulnerable residents of the Eastern District of New York, especially those in disadvantaged communities.  The Office has responsibility for the enforcement of our nation’s Civil Rights laws in the Eastern District of New York, which encompasses Brooklyn, Queens and Staten Island and Nassau and Suffolk Counties on Long Island. There are approximately eight million residents in the Eastern District.

The Office is creating this team in recognition of President Joseph Biden’s directive in Executive Order 13985, which sets forth that “[a]ffirmatively advancing equity, civil rights, racial justice, and equal opportunity is the responsibility of the whole of our Government.”  Among the areas that the Team will focus on are policing, patterns and practices of housing discrimination, and school segregation. 

In announcing the formation of the Civil Rights Team, Acting United States Attorney Lesko stated, “Today, the Eastern District of New York, a jurisdiction created by President Abraham Lincoln in 1865, celebrates the Juneteenth National Independence Day commemorating the abolition of slavery, which was signed into law yesterday by President Biden. This Office is firmly committed to identifying and rooting out discrimination in all of its forms, wherever it persists, and we have a long and storied history in the Eastern District of New York of enforcing federal laws that prohibit discrimination.  The creation of the Civil Rights Team will further strengthen the Office’s capacity to investigate and civilly prosecute civil rights violations in the City of New York and on Long Island, especially our ability to handle investigations of systemic discrimination.  The establishment of the Team demonstrates the commitment of this Office to vigorously enforce our federal civil rights laws to help foster a community where individuals can live safely, free from unlawful discrimination, and ensure equal rights for all, regardless of race, color, national origin, religion, sex, sexual orientation, gender identity or disability.”

The Office’s Civil Rights Practice is led by Civil Division Chief of Civil Rights Michael J. Goldberger; the Civil Rights Team is made up of Assistant United States Attorneys Rachel G. Balaban, Megan Freismuth, Sean Greene-Delgado, Dara Olds, and Civil Rights Investigator Laura Riley.  The Civil Rights Team is overseen by Civil Division Acting 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 Civil Rights Division and federal, state and local agencies that enforce civil rights laws.  The Office previously announced it had doubled the size of the Criminal Civil Rights Section under the leadership of Chief Elizabeth Geddes, who, among her other responsibilities, will act as liaison to the Civil Division’s newly formed Civil Rights Team.

The Office has also created a new webpage, located at https://www.justice.gov/usao-edny/civil-rights, dedicated to Civil Rights Enforcement, which highlights the work of the Office and provides links to complaint forms and to other civil rights resources.  For more information on the U.S. Attorney’s Office, or to report to report suspected violations of civil rights please visit https://www.justice.gov/usao-edny.  

Defendant Complained to Contractor in Code That Bribe Payment was Insufficient: “Sandwich was Light on the Meat”

A criminal complaint was unsealed today in Brooklyn charging Devraj Balbir, Ricardo Garcia, Patrick McCrann, Jevan Seepaul and Richard Zavada, managers employed in the facilitiesdepartment of a New York utility company (the “Company”), with conspiring to violate the Travel Act by accepting hundreds of thousands of dollars in bribes and kickbacks in exchange for steering contracts to certain Long Island-based contractors with whom the Company did business.  One contractor (the “Contractor”) secured more than $50 million in facility maintenance contracts from the Company during the time that the Contractor was paying bribes to the defendants.  The defendants were arrested today and will make their initial appearances this afternoon before United States Magistrate Judge James R. Cho.

Mark J. Lesko, Acting United States Attorney for the Eastern District of New York, and William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the arrests and charges.

“As alleged, the defendants made corrupt demands for bribes and kickbacks to line their own pockets and upgrade their lifestyles, while putting the contractors at risk of losing business if they did not comply,” stated Acting U.S. Attorney Lesko.  “This Office is committed to protecting the integrity of the bidding process and ensuring that businesses compete on a level, honest playing field.”

"Crimes of this nature weaken the integrity of the bidding process and deny consumers the benefit of free and open competition in the marketplace. The FBI will continue to work with the Antitrust Division to ensure fair bidding practices are employed across all sectors of our economy," stated FBI Assistant Director-in-Charge Sweeney.

As alleged in the complaint, between 2013 and 2020, the defendants solicited and accepted bribes and kickbacks from the owners of the Contractor and other contractors in connection with the awarding of maintenance work contracts for the Company.  As managers in the facilities department of the Company, McCrann, Garcia (after May 1, 2019) and Balbir (after May 1, 2020) had the authority to approve “no-bid” contracts valued at less than $50,000. The Contractor understood that if it did not pay bribes, these defendants would award the Company’s work to the Contractor’s competitors.  In exchange for the bribe payments, the defendants, including Seepaul and Zavada, also took various steps to assist the Contractor in obtaining contracts from the Company for which there was a bidding process, including providing it with non-public bidding information, circumventing the Company’s competitive bidding process and offering favorable reviews of the Contractor’s work. The Contractor paid bribes to ensure that the defendants did not slow or stop disbursement of project funds to the Contractor, provide negative performance reviews regarding the Contractor’s work, or otherwise claim that the Contractor’s work did not meet contractual specifications.  The defendants communicated with the contractors about bribe payments by text messages, among other forms of communication.  For example, on September 2, 2016, McCrann texted a contractor, “Sandwich was light on the meat” and that McCrann was “a little concerned,” indicating that a bribe payment had been insufficient.  The contractor replied, “I’ll ask for a nice one next time,” indicating that the next bribe payment would be larger.

The illicit payments to the defendants took multiple forms, including cash, purchase of a recreational vehicle, home improvements, landscaping and an overseas vacation.  For example, during 2017 and 2018, the Contractor paid tens of thousands of dollars in bribes to Balbir in the form of renovations performed at his residence.  Between August 2015 and April 2019, the Contractor also made college tuition payments totaling more than $30,000 for a family member of Garcia.  On February 25, 2018, Garcia sent a text message to a contractor containing images of airlines reservations for two individuals in April 2018 from Newark to Dubai and hotel reservation information for a 10-night hotel stay in Dubai for two individuals so that the contractor could pay for the expenses.  Financial records obtained during the investigation also revealed that the Contractor paid approximately $100,000 for work performed at Seepaul’s home during 2017.

As part of the investigation, agents recovered approximately $300,000 in cash from a safe deposit box held by Zavada.  On November 18, 2020, FBI special agents executed a search warrant at Zavada’s residence in Hicksville, New York, and seized electronic spreadsheets he maintained that contained dates, the amounts of bribe payments, and the names of various entities that provided facilities services to the Company. 

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

The government’s case is being handled by the Office’s Public Integrity Section.  Assistant United States Attorneys Turner Buford, Artie McConnell and Nathan Reilly are in charge of the prosecution.

The Defendants:

DEVRAJ BALBIR
Age:  33
North Bellmore, New York

RICARDO GARCIA
Age:  48
Stroudsburg, Pennsylvania

PATRICK MCCRANN
Age:  57
Selden, New York

JEEVAN SEEPAUL
Age:  36
Rockville Centre, New York

RICHARD ZAVADA
Age:  65
Hicksville, New York

E.D.N.Y. Docket No. 21-MJ-696

Today in federal court in Brooklyn, Noelle Velentzas was sentenced to 16 ½ years’ imprisonment by United States District Judge Sterling Johnson, Jr. for her role in planning a terrorist attack in the United States.  Velentzas and her co-defendant, Asia Siddiqui, pleaded guilty on August 23, 2019 to teaching or distributing information pertaining to the making and use of an explosive, destructive device, or weapon of mass destruction in furtherance of a planned federal crime of violence.  Siddiqui was sentenced in January 2020 to 15 years’ imprisonment. 

Mark J. Lesko, Acting United States Attorney for the Eastern District of New York; John C. Demers, Assistant Attorney General for the Justice Department’s National Security Division; William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI); and Dermot F. Shea, Commissioner, New York City Police Department (NYPD), announced the sentence.

“The defendant expressed her support for foreign terrorist organizations like al-Qaeda and the Islamic State of Iraq and al-Sham by learning how to build bombs and other explosive devices and targeting members of law enforcement for terror. Today’s sentence imposes a just punishment on the defendant for her planned horrific crimes,” stated Acting U.S. Attorney Lesko.  “Counterterrorism and protecting the American people remain among the highest priorities of the Department of Justice, and this Office, together with the FBI, the NYPD and our Joint Terrorism Task Force partners, will continue to exercise extreme vigilance to incapacitate terrorists.”

“As part of her plan goal to wage violent jihad, Velentzas and her co-defendant Asia Siddiqui researched and taught each other how to construct bombs to be used on American soil against law enforcement and military targets,” stated Assistant Attorney General Demers. “With the sentence imposed by the court, Velentzas has been held accountable for her crimes. The Attorney General recently reminded us that we must remain vigilant against threats from international terrorism, and we are grateful for those agents, analysts and prosecutors who were and brought Velentzas to justice before she could carry out her plans.”

Between approximately 2013 and 2015, Velentzas and her co-defendant Asia Siddiqui taught each other chemistry and electrical skills directly related to creating explosives and building detonating devices; studied the explosives used in past terrorist attacks including the Boston Marathon bombing, the Oklahoma City bombing, and the 1993 World Trade Center attack; researched how to make plastic explosives and build car bombs; shopped for and acquired materials to be used in an explosive device; and assessed potential targets of an attack, focusing on law enforcement and military-related targets.

While engaging in these activities, Velentzas repeatedly expressed her support for promoting and waging violent jihad and her desire to commit acts of violence.  Velentzas claimed that Osama bin Laden was her hero, and expressed praise for the September 11, 2001 attacks as well as Mohammed Shnewer, who was convicted of plotting a terrorist attack against members of the armed services at Fort Dix in New Jersey. 

At the time that Velentzas and Siddiqui were arrested in 2015, law enforcement officers searched their residences and found tools of the trade for a terrorist attack, including propane gas tanks, soldering tools, car bomb instructions and jihadist literature, machetes and knives. 

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

The Defendant:

NOELLE VELENTZAS
Age:  33
Queens, New York

E.D.N.Y. Docket No. 15-CR-213 (SJ)

Earlier today, at the federal courthouse in Brooklyn, Ronell Watson was sentenced to 382 months years’ imprisonment by United States District Judge William F. Kuntz, II, for the attempted murder and assault of Christopher Harper, a Special Agent of the Federal Bureau of Investigation.  Watson was convicted by a federal jury in July 2019 following a two-week trial.

Mark J. Lesko, Acting United States Attorney for the Eastern District of New York, and William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the sentence.

“Today, justice has been served.  This Office is gratified by the lengthy prison sentence the court imposed on Watson for his senseless, cold-blooded and unprovoked shooting of Special Agent Harper, who came close to losing his life,” stated Acting U.S. Attorney Lesko.  “This Office will never tolerate murderous assaults on members of law enforcement who put their lives on the line every day to protect and serve our communities.”  Mr. Lesko extended his grateful appreciation to the New York City Police Department for its assistance during the investigation and the medical staff at Kings County Hospital for saving Special Agent Harper’s life.

“Ronell Watson has now learned illegal behavior comes with lasting consequences.  He will now spend the next 31 years of his life in federal prison for his ambush attack of FBI Special Agent Harper.  While Watson is no longer a threat to the community, FBI Special Agents and our law enforcement partners remain on watch for those like him who have no regard for the lives of their fellow citizens.  I would like to acknowledge Special Agent Harper's bravery and quick thinking, which not only saved his life, but led to Watson's swift arrest.  His professionalism and courage under fire were an example for all of us.  This office is also eternally grateful to the NYPD, civilians, and the medical teams who responded to save their fellow public servant,” stated FBI Assistant Director-in-Charge Sweeney.

On December 8, 2018, Special Agent Harper was on-duty conducting surveillance in an unrelated case.  At approximately 3:20 p.m., Watson, driving a BMW sedan in the wrong direction, approached Agent Harper’s vehicle.  Watson partially blocked Agent Harper’s vehicle, exited his BMW and approached Agent Harper’s vehicle with his hand inside the pocket of his sweatshirt.  As Agent Harper tried to maneuver his vehicle around the BMW, Watson pulled a handgun out of his pocket and fired multiple shots, wounding Agent Harper in the back; the bullet lodged in one of his lungs.  Agent Harper returned fire at Watson, wounding him in the hand.  Watson abandoned his bullet-ridden BMW at a nearby auto body shop, then had a friend drive him in another vehicle to the hospital where he was ultimately arrested.  Special Agent Harper underwent multiple surgeries to have the bullet removed from his lung and continue his service as a Special Agent of the FBI.   

Assistant United States Attorney Francisco J. Navarro is in charge of the prosecution.

The Defendant:

RONELL WATSON
Age: 33
Canarsie, Brooklyn

E.D.N.Y. Docket No. 19-CR-4 (WFK)

Following six weeks of trial, a federal jury in Central Islip today convicted Howard Davis, also known as “Mousey” and “Mr. Fedup,” a Bloods gang leader from Bellport, New York, on all 48 counts, including attempted murder in-aid-of racketeering, conspiracy to commit murder, attempted murder, assault, robbery, distribution of controlled substances, obstruction of justice and brandishing and discharging firearms during the commission of these offenses.  Davis faces up to life imprisonment when he is sentenced by United States District Judge Joan M. Azrack. 

Mark J. Lesko, Acting United States Attorney for the Eastern District of New York; Peter C. Fitzhugh, Special Agent-in-Charge, Homeland Security Investigations, New York (HSI); William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI); and Stuart J. Cameron, Acting Commissioner, Suffolk County Police Department (SCPD), announced the verdict.

“With today’s conviction, a jury of his peers has held Davis to account for his long and brutal reign of terror, consisting of standing orders to kill, the shooting of six victims, and the spread of poisonous crack cocaine and heroin in our communities,” stated Acting U.S. Attorney Lesko.  “This Office and its law enforcement partners will continue their tireless efforts to eliminate the threats posed by violent defendants like Davis and dangerous street gangs like the Bloods.” stated Acting United States Attorney Lesko.  Mr. Lesko extended his grateful appreciation to the law enforcement agencies involved in the investigation and prosecution of Davis, including the FBI Long Island Gang Task Force and HSI Long Island Violent Gangs and Narcotics Unit.

“This infamous Bloods gang leader known as “Mousey” is convicted in federal court because of the unrelenting commitment of HSI’s Long Island Transnational Crime Task Force and our law enforcement partners to make our communities safer here on Long Island,” stated HSI Special Agent-in-Charge Fitzhugh.  “Davis was arrested and charged with a litany of violent felony crimes for his barbarous actions, and now his conviction has made the Suffolk County neighborhoods he terrorized safer with one less gang leader calling the shots. Davis clearly lost this game of cat and mouse.”

“Mr. Davis and his fellow gang members are the type of criminals who wreck neighborhoods by dealing potentially lethal drugs. They terrorize communities by firing illegal guns without thinking about the innocent people they may hit. These are the criminals who belong behind bars, and our job as law enforcement is to stop their criminal behavior before their actions harm anyone else,” stated FBI Assistant Director-in-Charge Sweeney.

“The conviction of Howard Davis highlights the outstanding results that can be achieved when local law enforcement works in tandem with our federal law enforcement partners,” stated SCPD Acting Commissioner Cameron. “His criminal activities endangered the residents of our county on a daily basis and his criminal activities know no bounds as he went as far as enticing the mother of his child to commit perjury for him. I would like to thank all of the law enforcement officers involved for their hard work to put this dangerous individual behind bars.”

As proven at trial, Davis was the leader of Long Island-based G-Shine Bloods set, a racketeering enterprise that engaged in multiple crimes of violence and narcotics trafficking. Davis directed a campaign of violence against his rivals, including issuing a standing order to kill certain individuals whenever and wherever they were found.  In addition, Davis committed numerous shootings.  During the trial, the government elicited details of the injuries suffered by more than six shooting victims at the hands of Davis and his G-Shine crew.  Davis and his gang financed its activities through extensive narcotics trafficking.  Over the course of the defendant’s narcotics trafficking conspiracy, he distributed large quantities of crack cocaine and heroin, as well as quantities of fentanyl.  The evidence also established that Davis possessed and used firearms to further his drug business and gang activities.  Davis was also convicted of obstruction of justice for arranging for the mother of his child to testify falsely before a federal grand jury, resulting in the 2016 dismissal of a firearms charge.  

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

The government’s case is being handled by the Office’s Long Island Criminal Division.  Assistant United States Attorneys Christopher Caffarone, Mark Misorek and Monica Castro are in charge of the prosecution. 

The Defendant:

HOWARD DAVIS (also known as “Mousey” and “Mr. Fedup”)
Age:  34
Bellport, New York

E.D.N.Y. Docket No. 17-CR-615 (JMA)