Eastern District of New York

Earlier today, in federal court in Brooklyn, an indictment was unsealed charging Joshua Philips, also known as “Erick Ayo Kalu,” “Anthony Abongile Baker” and “Johnson Foday Brown,” with conspiring to commit wire and bank fraud and conspiring to commit money laundering, in connection with several business email compromise and confidence fraud scams.  Philips was arrested on March 7, 2018, in the Northern District of Georgia and was arraigned this afternoon before United States Magistrate Judge Linda T. Walker at the federal courthouse in Atlanta, Georgia. 

Richard P. Donoghue, 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 charges.

“As alleged in the indictment, Philips stole hundreds of thousands of dollars from his victims, then laundered the proceeds of his scam,” stated United States Attorney Donoghue.  “The rule of law applies in cyberspace just as it does on the street, and this Office, together with our law enforcement partners, is committed to investigating and prosecuting cybercriminals like the defendants who engage in illegal conduct.”  Mr. Donoghue expressed his appreciation to the FBI Field Office in Atlanta and the United States Attorney’s Office for the Northern District of Georgia for their assistance in the case.

“As we alleged, Joshua Philips, together with others, was able to swindle more than $800,000 from unsuspecting victims as a result of schemes of deception known as business email compromise and confidence fraud,”  stated FBI Assistant Director-in-Charge Sweeney.  “Philips, together with others, tricked victims into sending funds to accounts they thought were part of a legitimate business deal. The defendant then transferred his ill-gotten gains to overseas accounts. I commend the work of the Cyber Task Force who worked dutifully to bring this case to justice.”

Business email compromise is a form of cyber-enabled financial fraud.  In a typical business email compromise scheme, a malicious actor compromises legitimate business email accounts through computer intrusion techniques or social engineering and uses those accounts to cause the unauthorized transfer of funds.  Techniques for perpetrating these schemes include spear phishing, identity theft, spoofing of emails and websites, and the use of malware. 

Confidence fraud is another form of cyber-enabled financial fraud.  In a typical confidence fraud, a malicious actor befriends, and gains the confidence of, another individual through online communications and uses that confidence to cause the transfer of funds for unauthorized purposes. 

As alleged in court documents, individuals in the Eastern District of New York and around the United States were defrauded – through business email compromise and confidence fraud scams – into sending more than $800,000 to the defendant.  For example, in or about July 2017 and August 2017, the defendant and others targeted an individual on Long Island (“John Doe 1”) who was engaged in a real estate transaction involving the purchase of property in Massapequa, New York, and his real estate attorney (“John Doe 2”), who facilitated the purchase.  On or about August 23, 2017, John Doe 1 received an email from John Doe 2’s email account asking, “With regards to the closing funds, is it currently available?”  After responding that the funds were available, John Doe 1 received an email on August 24, 2017 from John Doe 2’s email account instructing him to “to go to your local branch within the day and initiate a wire transfer of the funds to my attorney escrow account.”  The email provided information for a bank account that was, in fact, in the control of one of the defendant’s co-conspirators.  On August 28, 2017, John Doe 1 sent a wire transfer in the amount of $84,000 to the bank account.  The co-conspirator received the money and transferred a portion of it to Philips, who then wired a portion of it overseas.  John Doe 2 has informed law enforcement officers that he did not send the August 24 email and that the bank account details did not pertain to any account within his control.

As part of the broader cyber-enabled schemes, Philips unlawfully transferred the fraudulently obtained money overseas, including to various foreign bank accounts and to purchase used cars for an import/export company in Nigeria.

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

According to the FBI’s Internet Crime Complaint Center (IC3), business email compromise and confidence fraud scams have continued to rise over the past few years and were the top two types of internet crimes (by reported loss) reported to the FBI in 2016.  Such scams have victimized large and small companies, as well as individuals, in every U.S. state and in more than 100 countries around the world. 

If you or your company has been victimized by a business email compromise scam or confidence fraud, it is important to act quickly.  The FBI’s Internet Crime Complaint Center (IC3) provides the public with a reporting mechanism to submit information concerning suspected Internet-facilitated criminal activity.  Individuals and companies who have been victims of Internet crimes are encouraged to file a complaint online at www.ic3.gov.  In addition, victims can take steps to mitigate further loss such as contacting banks, credit card companies, and/or credit bureaus to block accounts, freeze accounts, dispute charges, and attempt recovery of lost funds.

The government’s case is being handled by the Office’s National Security & Cybercrime Section.  Assistant United States Attorney Saritha Komatireddy is in charge of the prosecution.

The Defendant:

JOSHUA PHILIPS (also known as “Erick Ayo Kalu,” “Anthony Abongile Baker” and “Johnson Foday Brown”)
Age: 33 
Ellenwood, Georgia

E.D.N.Y. Docket No. 18-CR-121

WASHINGTON - Attorney General Jeff Sessions announced the appointment of six new U.S. Attorneys to serve two-year terms on the Attorney General’s Advisory Committee of U.S. Attorneys (AGAC), joining the nine members announced on November 13, 2017. The AGAC was created in 1973 and reports to the Attorney General through the Deputy Attorney General. It represents the U.S. Attorneys and provides advice and counsel to the Attorney General on matters of policy, procedure, and management affecting the Offices of the U.S. Attorneys.

The new appointees are U.S. Attorney for the Northern District of Texas Erin Nealy Cox; U.S. Attorney for the Eastern District of New York Richard P. Donoghue; U.S. Attorney for the Middle District of Alabama Louis V. Franklin, Sr.; U.S. Attorney for the Northern District of Illinois John R. Lausch, Jr.; U.S. Attorney for the District of Massachusetts Andrew E. Lelling; and U.S. Attorney for the District of Delaware David C. Weiss.

“I am pleased to announce these new members of the Attorney General’s Advisory Committee. The Advisory Committee plays an important role in helping us achieve the Department of Justice’s goals, including to reduce violent crime, combat transnational criminal organizations, secure our southern border, end the devastating opioid crisis, and enforce the rule of law,” said Attorney General Sessions.

A brief biography of each new member is below: Erin Nealy Cox
The Senate confirmed Erin Nealy Cox’s appointment as United States Attorney for the Northern District of Texas in November 2017. Prior to this appointment, Ms. Nealy Cox was a Senior Advisor at McKinsey & Co in the cybersecurity and risk practice and on the Board of Directors of Sally Beauty Holdings, a large retailer on the NYSE. From 1999 to 2008, Ms. Nealy Cox served as an Assistant United States Attorney in the Northern District of Texas, where she prosecuted cyber crimes, white collar crimes, and general crimes. In 2004 and 2005, she served at Main Justice as Chief of Staff and Senior Counsel to the Assistant Attorney General in the Office of Legal Policy. Ms. Nealy Cox also previously worked at Stroz Friedberg, a cybersecurity and investigations consulting firm. Ms. Nealy Cox clerked for the Honorable Henry A. Politz, when he served as Chief Judge of the Fifth Circuit Court of Appeals, and the Honorable Barefoot Sanders, United States District Judge in the Northern District of Texas. She received a B.B.A in Finance from the McCombs School of Business at the University of Texas at Austin and her J.D., magna cum laude, from Southern Methodist University Dedman School of Law.

Richard P. Donoghue
On January 5, 2018, the Attorney General appointed Richard P. Donoghue to be interim United States Attorney for the Eastern District of New York. Prior to this appointment, Mr. Donoghue served as the Senior Vice President and Chief Counsel for CA Technologies based in New York. From 2000 to 2011, Mr. Donoghue worked in the United States Attorney’s Office for the Eastern District of New York in various roles, including Criminal Chief and Deputy Criminal Chief. Mr. Donoghue received his B.A., cum laude, from Hofstra University and his J.D., from St. John’s University School of Law.

Louis V. Franklin, Sr.
The Senate confirmed Louis V. Franklin, Sr. to be United States Attorney for the Middle District of Alabama in September 2017. Mr. Franklin has served in the United States Attorney’s Office for the Middle District of Alabama for nearly 27 years, including as Criminal Chief for almost 16 years. Mr. Franklin served as an Assistant United States Attorney from 1990 to 1996 and from 1998 to 2001. From 1996 to 1998, Mr. Franklin was an associate at Sirote and Permutt. Mr. Franklin began his career as a staff attorney at the Legal Services Corporation of Alabama from 1987 to 1990. Mr. Franklin received his B.A. from the University of Alabama, an M.S. from Auburn University at Montgomery, and his J.D. from Howard University School of Law.

John R. Lausch, Jr.
The Senate confirmed John R. Lausch, Jr.’s appointment as United States Attorney for the Northern District of Illinois in November 2017. Prior to his appointment, Mr. Lausch was a partner at Kirkland & Ellis LLP. Previously, he served as an Assistant United States Attorney in the Northern District of Illinois from 1999 to 2010. During his time in the U.S. Attorney’s Office, Mr. Lausch served as a Deputy Chief in the Narcotics and Gangs Section for several years, where he helped lead the District’s Anti-Gang and Project Safe Neighborhoods programs. Mr. Lausch clerked for the Honorable Michael S. Kanne of the United States Court of Appeals for the Seventh Circuit. He received his A.B., cum laude, from Harvard University and his J.D., cum laude, from Northwestern University School of Law.

Andrew E. Lelling
The Senate confirmed Andrew E. Lelling’s appointment as United States Attorney for the District of Massachusetts in December 2017. Prior to this appointment, Mr. Lelling was the senior litigation counsel for the United States Attorney’s Office for the District of Massachusetts and has worked in that office for 12 years, prosecuting white collar crime and international drug trafficking, among other offenses. Mr. Lelling also served as an Assistant United States Attorney in the Eastern District of Virginia. He previously served as counsel to the Assistant Attorney General at the Department of Justice Civil Rights Division. Mr. Lelling clerked for the Honorable B. Avant Edenfield of the United States District Court for the Southern District of Georgia. He received his B.A., magna cum laude, from the State University of New York at Binghamton and his J.D., cum laude, from the University of Pennsylvania Law School.

David C. Weiss
David C. Weiss’s nomination to be United States Attorney for the District of Delaware was confirmed in February. Mr. Weiss previously served as the Acting United States Attorney for the District of Delaware from 2009 to 2011 and 2017 to 2018, and as the First Assistant United States Attorney from 2007 to 2017. Prior to serving in these positions, Mr. Weiss was an Assistant United States Attorney from 1986 to 1989. Mr. Weiss clerked for the Honorable Andrew D. Christie of the Delaware Supreme Court. Mr. Weiss received his B.S. from Washington University and his J.D. from Widener University School of Law.

Earlier today, in federal court in Brooklyn, Martin Shkreli was sentenced by United States District Judge Kiyo A. Matsumoto of the Eastern District of New York to seven years’ imprisonment for committing securities fraud and securities fraud conspiracy, to be followed by three years’ supervised release.  The Court also ordered Shkreli to pay a $75,000 fine and $7.3 million in forfeiture.  Earlier this week, the Court signed a Preliminary Order of Forfeiture, which will allow the government to seize substitute assets to satisfy the forfeiture judgment if necessary, including $5 million held in an account that had been used to secure Shkreli’s bail, the “Once Upon A Time in Shaolin” album by the Wu Tang Clan, the “Tha Carter V” album by Lil Wayne, and a Picasso painting. 

Shkreli was the founder and managing member of hedge funds MSMB Capital Management LP (MSMB Capital) and MSMB Healthcare Management LP (MSMB Healthcare) and the former Chief Executive Officer of Retrophin Inc. (Retrophin), a biopharmaceutical company that trades under the ticker symbol RTRX.  He was convicted by a federal jury in August 2017, following a six-week trial, of two counts of securities fraud and one count of securities fraud conspiracy.  In September 2017, the Court found that Shkreli had violated his bail conditions by making online threats against former U.S. Secretary of State Hillary Clinton, and remanded him into custody at the Metropolitan Detention Center, where he is currently incarcerated.

Richard P. Donoghue, 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.

“For years, Shkreli told lie after lie in order to steal his investors’ money, manipulate the stock market and enrich himself,” stated United States Attorney Donoghue.  “He will now pay the price for repeatedly violating the trust placed in him by his investors, his employees and the public.  It remains a priority of this Office, together with our law enforcement partners, to identify, investigate and bring to justice criminals like Shkreli.”  Mr. Donoghue thanked the Securities and Exchange Commission, New York Regional Office (SEC), and the Financial Industry Regulatory Authority, Inc., Criminal Prosecution Assistance Group (FINRA CPAG), for their significant cooperation and assistance in this case.

“Martin Shkreli was notoriously ambitious, seeking to enrich himself at the expense of those who unwittingly invested in his lies,” stated FBI Assistant Director-in-Charge Sweeney. “His crimes have been laid bare for all to see, and his intentions, which have been proven true beyond a reasonable doubt, resulted in this sentencing today. While we can now close this chapter of our investigation, our efforts continue to uncover and expose all crimes of this nature that claim innocent victims and defraud our financial markets.”

The evidence at trial established that Shkreli, who was convicted on three counts of the superseding indictment, alleging securities fraud (Counts Three and Six) and securities fraud conspiracy (Count Eight), executed three schemes to defraud investors: 

As charged in Count Three, between 2009 and 2014, Shkreli used false representations and omissions to induce investors to invest more than $3 million in MSMB Capital, a hedge fund he founded in 2009.  Subsequently, following trading losses, Shkreli sent fabricated performance updates to investors, boasting that the fund had made big profits when, in fact, it had sustained substantial losses.  In addition, Shkreli withdrew more than $200,000 from MSMB Capital, far more than the one percent management fee and the 20 percent net profit incentive allocation permitted by the fund’s partnership agreement. 

As charged in Count Six, between 2011 and 2014, Shkreli used false representations and omissions to induce investors to invest more than $5 million in MSMB Healthcare, a hedge fund founded by Shkreli after the implosion of MSMB Capital.  Additionally, Shkreli used MSMB Healthcare assets to pay obligations that were not MSMB Healthcare’s responsibility.  As with the MSMB Capital scheme, Shkreli withdrew more from MSMB Healthcare than the one percent management fee and the 20 percent net profit incentive allocation permitted by the fund’s partnership agreement.

As charged in Count Eight, between 2012 and 2014, Shkreli and his co-defendant Evan Greebel, an attorney who served as outside counsel to Retrophin, engaged in a scheme to defraud investors and potential investors in Retrophin by attempting to illegally control the price and trading volume of Retrophin’s stock.  Greebel and Shkreli executed this scheme by, among other things, concealing Shkreli’s beneficial ownership and control of the majority of Retrophin’s free-trading shares.  Greebel and Shkreli recruited associates of Shkreli to be nominee shareholders for the majority of Retrophin’s free-trading shares, and they also filed a false document with government regulators to hide the fact that Shkreli controlled those shares.  Greebel and Shkreli prevented the nominee shareholders from selling these shares, and also directed that some of the shares be used to settle liabilities owed by the MSMB hedge funds and Shkreli. 

In addition, Judge Matsumoto ruled in a decision issued on February 26, 2018 in connection with the sentencing, that the government had also proven by a preponderance of the evidence that Shkreli had engaged in a fourth fraud scheme, the wire fraud conspiracy charged in Count Seven of the superseding indictment.  Specifically, the evidence at trial established by a preponderance that between 2011 and 2014, Shkreli conspired with Greebel and others in a scheme to misappropriate Retrophin’s assets in order to pay off defrauded investors in MSMB Capital and MSMB Healthcare.  As part of this scheme, Shkreli and Greebel caused Retrophin to enter into so-called “settlement” agreements with certain defrauded MSMB Capital and MSMB Healthcare investors, which caused Retrophin to reimburse those investors more than $2 million in cash and stock for their lost investments in Shkreli’s hedge funds even though Retrophin was not responsible for those losses.  Shkreli and Greebel also arranged for certain other defrauded investors to enter into sham consulting agreements with Retrophin as a means to settle liabilities owed by Shkreli and the hedge funds.  In total, the settlement and sham consulting agreements caused losses to Retrophin of over $10 million. 

In a separate trial in December 2017, Greebel was convicted of wire fraud conspiracy (Count Seven) and securities fraud conspiracy (Count Eight), following an 11-week trial.  He is awaiting sentencing.

The government’s case is being handled by the Office’s Business and Securities Fraud Section.  Assistant United States Attorneys Jacquelyn M. Kasulis, Alixandra E. Smith and G. Karthik Srinivasan are in charge of the prosecution, with assistance from Assistant United States Attorneys Laura Mantell and Claire Kedeshian of the Office’s Asset Forfeiture Section.

The Defendants:

MARTIN SHKRELI
Age: 34
Manhattan, New York

EVAN GREEBEL
Age: 44
Scarsdale, New York

E.D.N.Y. Docket No. 15-CR-637 (KAM)

Earlier today, at the federal courthouse in Brooklyn, Jose Dagoberto Cortez-Perez, also known as “D.C.P.,” a “chemist” or “cook” of illegal narcotics for a violent Mexican drug trafficking organization, was sentenced by United States District Judge Carol Bagley Amon to 10 years’ imprisonment for his involvement in a large-scale international narcotics distribution conspiracy.  Cortez-Perez was apprehended in Minnesota and pled guilty on September 25, 2017 to conspiring to import more than 500 grams of methamphetamine, more than one kilogram of heroin, more than five kilograms of cocaine and more than 1,000 kilograms of marijuana.  After serving his sentence, the defendant will face deportation from the United States.

 Richard P. Donoghue, United States Attorney for the Eastern District of New York, announced the sentence. 

“A Mexican cartel employed Jose Dagoberto Cortez-Perez for his specialized skill improving the quality and purity of illegal and addictive narcotics, in particular methamphetamine,” stated United States Attorney Donoghue.  “Cortez-Perez travelled around the country on behalf of the cartel and enhanced the addictive nature of its narcotics, which ultimately increased demand and price for them.  Today, drug trafficking organizations are on notice that we will bring the full weight of the law to bear on those activities that destabilize our communities.”  Mr. Donoghue extended his grateful appreciation to the United States Attorney’s Office for the District of Minnesota, as well as the Chicago Division of the U.S. Drug Enforcement Administration, for their assistance in the investigation and prosecution.

According to court filings and facts presented during court proceedings, the defendant was a member of a Mexican-based drug trafficking organization, which was responsible for the manufacture, importation and distribution of multi-ton quantities of heroin, methamphetamine, cocaine, and marijuana into the United States, including to locations in the Eastern District of New York.  The defendant was a “chemist” or “cook” for the organization, and was sent to the United States to repair (or “clean”) methamphetamine that was not sufficiently pure or had otherwise been contaminated.  The defendant created a more desirable product that was then distributed across the United States, including Brooklyn and Queens.  In May 2016, DEA agents searched two homes in Minnesota and discovered more than 140 pounds of methamphetamine, more than $130,000 in United States currency, evidence of an ongoing methamphetamine cleaning operation and drug paraphernalia.  This seizure demonstrated a highly organized drug network responsible for the distribution of large-scale quantities narcotics. 

The government’s case is being handled by the Office’s International Narcotics and Money Laundering Section.  Assistant United States Attorneys Craig R. Heeren, Ryan C. Harris, Alicia N. Washington, G. Karthik Srinivasan and Michael P. Robotti are in charge of the prosecution.

The Defendant:

Jose Dagoberto Cortez-Perez 
Age: 28
Residence: Sinaloa, Mexico

EDNY Docket No. 16-CR-241 (CBA)

Earlier today, following a four-day trial, Louis F. Petrossi, the founder and president of the Wealth Research Institute, a purported investment research firm, was convicted by a federal jury in the Middle District of Pennsylvania, of securities fraud, investment adviser fraud and wire fraud for his role in a scheme to defraud investors.  Petrossi falsely claimed to investors that money they had invested in purported investment funds called Chadwicke would be used to invest in startup companies.  Instead, the defendant used the investors’ money to pay for personal expenses, and he issued fraudulent statements that overstated both the cost and value of the securities held by Chadwicke. 

Richard P. Donoghue, 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 Division (FBI), announced the verdict.  Mr. Donoghue expressed his appreciation to the United States Attorney’s Office for the Middle District of Pennsylvania for their assistance with the case.

The evidence at trial established that between January 2015 and January 2017, Petrossi solicited more than $1.8 million in investments in one of the Chadwicke funds from more than 25 investors, including one who resides in the Middle District of Pennsylvania.  Petrossi promoted Chadwicke as providing the opportunity to invest in high-profile startup companies such as Lyft, Inc., Maplebear Inc., Pinterest Inc., Spotify Technology SA and Palantir Technologies, Inc., among others.  Petrossi invested approximately $665,400 in privately held startup companies but used more than $1.1 million in investor funds to pay for personal expenses, including payments to BMW, renovations to his home and payment of his personal legal fees.  In or around August 2016, Petrossi sent emails to Chadwicke investors attaching a spreadsheet that contained false and misleading statements about the purchase price and value of the securities held by the Chadwicke funds in order to conceal his misappropriation of investor money.

On May 3, 2016, Petrossi was arrested in Nevada pursuant to an indictment returned by a federal grand jury sitting in the Eastern District of New York for his role in a securities fraud scheme involving the securities of ForceField Energy Inc.  Under the terms of Petrossi’s pre-trial release, the defendant was prohibited from employment “directly involving the handling of investors.”  Between May 3, 2016 and approximately January 2017, Petrossi continued to engage in the Chadwicke scheme by emailing the August 2016 spreadsheet and soliciting $210,000 in investor funds.

Petrossi faces a maximum of 20 years’ imprisonment when he is sentenced by United States Chief District Judge Christopher C. Conner of the Middle District of Pennsylvania.

Petrossi was convicted in May 2017 by a federal jury in Brooklyn for his role in the ForceField Energy Inc. market manipulation scheme.  He faces a maximum sentence of 20 years’ imprisonment when he is sentenced by United States District Judge Brian M. Cogan of the Eastern District of New York.

The government’s case is being prosecuted by Assistant United States Attorney Mark E. Bini of the Eastern District of New York and Special Assistant United States Attorney John O. Enright of the United States Securities and Exchange Commission’s Enforcement Division.

The Defendant:

LOUIS F. PETROSSI
Age:  77
Residence: Reno, Nevada

M.D.P.A. Docket No. 17-CR-192 (CCC)

A four-count indictment was unsealed earlier today in federal court in Brooklyn, charging Ppassim Elder, Dwayne Ling and Frederick McCoy with the October 23, 2017 murder of a Queens business owner in front of his son, as well as the extortion of that father and son.  A fourth defendant, Mahdi Abdel-Rahim, was also indicted for his role in the extortion.  He was arrested on March 1, 2018 and released on a secured bond.  Ling was arrested on March 1, 2018, and ordered detained.  Elder was arrested in Cleveland, Ohio on March 2, 2018, was presented in that district on March 5, 2018, and is being transferred in custody to the Eastern District of New York.  McCoy was arrested yesterday and will be arraigned this afternoon in federal court in Brooklyn before United States Magistrate Judge Robert M. Levy.

Richard P. Donoghue, 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 James P. O’Neill, Commissioner, New York City Police Department (NYPD), announced the charges. 

“As alleged in the court filings, defendant Ppassim Elder exploited a business owner’s need for a loan and sent his enforcers to try to collect it, ultimately leading to a senseless and tragic murder,” stated United States Attorney Donoghue.  “No son should ever watch his father be killed.  This Office and our law enforcement partners are committed to protecting businesses in our community from violent criminals.”  Mr. Donoghue also expressed his appreciation to the Queens County District Attorney’s Office for their assistance during the investigation.

“When criminals loan money to business owners, they know they’re never going to get repaid, it’s why they loan out the money.  Once they have the victim on the hook, they use threats, intimidation and violence to harass their victims.  In this case, the victim died allegedly at the hands of his debtors,” stated FBI Assistant Director-in-Charge Sweeney.  “No one should have to pay criminals with their life, and the FBI New York Joint Organized Crime Task Force won’t let these violent offenders get away with it.”

As alleged in the indictment and detailed in court filings, on the morning of October 23, 2017, three perpetrators wearing blazers—Ling, McCoy and another coconspirator—walked into Garden Valley Distributors, a family-owned grocery distribution center located in Ozone Park.  The perpetrators said that “Sam” or “Big Sam” had sent them to collect his money.  Elder, who was known as “Sam” and “Big Sam,” had given the murder victim’s son a loan, which the son used to support the business.  By March 2017, Elder demanded full repayment of the loan, but the son could not afford to repay it because much of the money had been used to purchase merchandise for Garden Valley.

In response, Elder began a campaign of intimidation against the son and his family.  Among other things, Elder paid the defendant Mahdi Abdel-Rahim to throw a rock through a window of the home of the son and his father.  When the rock did not lead to repayment of the loan, Elder sent Ling, McCoy and a third coconspirator into Garden Valley, where the perpetrators brandished a firearm, pistol-whipped the son across his head, and fatally shot the father in the face. 

All four defendants are charged with extortionate collection of credit conspiracy and extortionate collection of credit.   Elder, Ling and McCoy are also charged with brandishing a firearm in furtherance of those crimes of violence and causing the death of another through use of a firearm.  The charges in the indictment are merely allegations, and the defendants are presumed innocent unless and until proven guilty.  If convicted of the murder charge or firearm charge, Elder, McCoy and Ling face a maximum sentence of life imprisonment.  If convicted of the extortion charge, Abdel-Rahim faces a maximum of 20 years’ imprisonment.

The government’s case is being handled by the Office’s Organized Crime and Gangs Section.  Assistant United States Attorneys Andrey Spektor and Keith D. Edelman are in charge of the prosecution.

The Defendants:

PPASSIM ELDER (also known as “Sam” and “Big Sam”)
Age: 38 
Staten Island, New York

MAHDI ABDEL-RAHIM
Age: 24
Brooklyn, New York

DWAYNE LING
Age: 55
Brooklyn, New York

FREDERICK MCCOY
Age: 52
Brooklyn, New York

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

A federal jury in Central Islip, New York, returned a guilty verdict today against Fernando Clarke, an investigator with the New York City Department of Correction, on child pornography trafficking offenses. 

Clarke, 63, of East Meadow, New York, was found guilty of two counts of transportation of child pornography, four counts of receipt of child pornography, and one count of possession of child pornography.  He is scheduled to be sentenced on April 13, by U.S. District Judge Arthur D. Spatt.  Clarke remains in custody following the jury’s verdict.

The verdict was announced by Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division, U.S. Attorney Richard P. Donoghue for the Eastern District of New York and Special Agent-in-Charge Angel M. Melendez of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) New York.

“By trafficking in images depicting the sexual abuse and exploitation of numerous children, Fernando Clarke added to the demand that fuels the creation and dissemination of these horrific images,” said Acting Assistant Attorney General Cronan.   “The diligent efforts of our investigative partners helped ensure that this former corrections investigator, who violated the public’s trust in law enforcement, was brought to justice.”

“As a sworn law enforcement officer, Clarke had a mandatory obligation to report child abuse,” said U.S. Attorney Donoghue. “Instead, he downloaded images of the rape and abuse of children for his personal use.  We will be vigilant in holding accountable law enforcement officers who violate their oaths.” 

“Clarke downloaded videos of children being sexually abused,” said Special Agent-in-Charge Melendez.  “It is unfathomable that anyone, especially someone working in law enforcement, could be capable of such an act.  Clarke will face the consequences of his reprehensible actions, and it is because of individuals like him that HSI will continue to work tirelessly, dedicating extensive resources, to investigating child exploitation cases in New York and around the country.”

According to court filings and evidence introduced at trial, Clarke downloaded video files of the sexual abuse of preteen children, which he kept on computer equipment in his home.  During a court-ordered search of his home on July 28, 2015, Clarke initially claimed that he was downloading child pornography in connection with his employment as a Department of Correction investigator.  Clarke admitted at the time of the search, however, that he had not been authorized to access or download child pornography for his employment.  Clarke was arrested at the time of the search and subsequently suspended from the Corrections Department.

The investigation was conducted by HSI; the New York City Department of Investigation, Inspector General, Board of Correction and the High Technology Investigative Unit (HTIU) of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS).  The case is being prosecuted by Trial Attorney Lauren Kupersmith of the Criminal Division’s CEOS and Assistant U.S. Attorney Allen L. Bode of the U.S. Attorney’s Office’s Long Island Criminal Division.

A federal jury in Central Islip returned a guilty verdict today against Fernando Clarke, an investigator with the New York City Correction Department, on seven counts of transportation, receipt and possession of child pornography.  Clarke faces a minimum penalty of five years in prison and a fine of $250,000, when he is sentenced by United States District Judge Arthur D. Spatt on April 13, 2018.  Clarke remains in custody.

Richard P. Donoghue, United States Attorney for the Eastern District of New York, Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division, and Angel M. Melendez, Special Agent-in-Charge, U.S. Immigration and Customs Enforcement, Homeland Security Investigations (HSI), New York, announced the verdict.

“As a sworn law enforcement officer, Clarke had a mandatory obligation to report child abuse,” stated United States Attorney Donoghue. “Instead, he downloaded images of the rape and abuse of children for his personal use.  We will be vigilant in holding accountable law enforcement officers who violate their oaths.”  Mr. Donoghue extended his grateful appreciation to HSI; the New York City Department of Investigation, Inspector General, Board of Correction; the Department of Justice Criminal Division’s Child Exploitation and Obscenity Section (“CEOS”) and High Technology Investigative Unit (“HTIU”), for their assistance in this case.

“By trafficking in images depicting the sexual abuse and exploitation of numerous children, Fernando Clarke added to the demand that fuels the creation and dissemination of these horrific images,” said Acting Assistant Attorney General Cronan.  “The diligent efforts of our investigative partners helped ensure that this former corrections investigator, who violated the public’s trust in law enforcement, was brought to justice.”

 “Clarke downloaded videos of children being sexually abused,” stated HSI Special Agent-in-Charge Melendez.  “It is unfathomable that anyone, especially someone working in law enforcement, could be capable of such an act.  Clarke will face the consequences of his reprehensible actions, and it is because of individuals like him that HSI will continue to work tirelessly, dedicating extensive resources, to investigating child exploitation cases in New York and around the country.”

According to court filings and evidence introduced at trial, Clarke downloaded video files of the sexual abuse of preteen children, which he kept on computer equipment in his home.  During a court-ordered search of his home on July 28, 2015, Clarke initially claimed that he was downloading child pornography in connection with his employment as a Correction Department investigator.  Clarke admitted at the time of the search, however, that he had not been authorized to access or download child pornography for his employment.  Clarke was arrested at the time of the search and subsequently suspended from the Corrections Department.

The government’s case is being prosecuted by Assistant United States Attorney Allen L. Bode of the Long Island Criminal Division and Department of Justice Trial Attorney Lauren Kupersmith.

The Defendant:

FERNANDO CLARKE
Age:  64
East Meadow, New York

E.D.N.Y. Docket No. 15-CR-426(S-1) (ADS)(AKT)

Dennis Mancino, the President and Chief Executive Officer of HD View 360, Inc. (“HDVW”) and William Hirschy, the Chief Executive Officer of WT Consulting Group, LLC, were arrested yesterday on charges that they conspired to commit securities fraud by manipulating the price and trading volume of HDVW, a publicly-traded company that purported to distribute and install security surveillance systems.  The defendants are scheduled to make their initial appearances this afternoon in the Southern District of Florida at the federal courthouse in Miami.

Richard P. Donoghue, 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 James D. Robnett, Special Agent-in-Charge, Internal Revenue Service Criminal Investigation, New York (IRS-CI), announced the charges.  

“As alleged in the complaint, the defendants engaged in a classic pump and dump designed to defraud the investing public and make millions of dollars for themselves by manipulating the price and volume of a publicly traded stock,” stated United States Attorney Donoghue.  “The charges announced today demonstrate the commitment of this Office, together with our law enforcement partners, to protecting the investing public by prosecuting pump and dump fraudsters.”  Mr. Donoghue thanked the Securities and Exchange Commission, both the New York Regional Office and the Washington, D.C. Office, for their significant cooperation and assistance during the investigation. 

“As alleged, Mancino and Hirschy tricked their victims into investing in HDVW under false pretenses, profiting from an orchestrated loss to those who unwittingly participated in this scheme,” stated FBI Assistant Director-in-Charge Sweeney.  “People have the right to trade in an uncorrupted market, and today’s charges are proof of the FBI’s continued determination to root out those who unlawfully interfere with this process.”

According to court filings, between July 2017 and February 2018, Mancino and Hirschy engaged in a scheme in which they agreed to artificially control the price and trading volume of shares in Mancino’s company, HDVW.  As part of the scheme, the defendants conspired to “pump” HDVW’s stock price by executing fraudulent trades and having HDVW issue weekly press releases and then, once HDVW’s stock price had increased, to “dump” the stock for a multi-million dollar profit.  The defendants further agreed to pay kickbacks to stock brokers who would execute manipulative trades designed to increase the price and trading volume of HDVW’s stock.  In furtherance of the scheme, the defendants executed numerous fraudulent matched trades designed to create the false appearance that HDVW’s stock price had risen as a result of genuine market demand. 

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

The case is being handled by the Office’s Business and Securities Fraud Section.  Assistant United States Attorneys Jacquelyn M. Kasulis, Michael T. Keilty and David Gopstein are in charge of the prosecution. 

The Defendants:

DENNIS MANCINO
Age: 46
Residence: Miami, Florida

WILLIAM HIRSCHY
Age: 41
Residence: Ocala, Florida

E.D.N.Y. Docket No. 18-MJ-184

A multi-count indictment was unsealed yesterday, in federal court in Brooklyn, against Panayiotis Kyriacou, Arvinsingh Canaye, Adrian Baron, Linda Bullock, Matthew Green, and Aristos Aristodemou; Beaufort Securities Ltd (“Beaufort Securities”), a brokerage firm located in London, United Kingdom; Beaufort Management Services Ltd (“Beaufort Management”), an off-shore management company located in Mauritius; Loyal Bank Ltd (“Loyal Bank”), an off-shore bank with offices in Budapest, Hungary and Saint Vincent and the Grenadines; and Loyal Agency and Trust Corp. (“Loyal Agency”), an off-shore management company located in Saint Vincent and the Grenadines.

The charges include conspiracy to commit securities fraud and money laundering conspiracy.  Canaye was arrested yesterday and is scheduled to be arraigned this afternoon before United States Magistrate Judge Vera M. Scanlon at the federal courthouse in Brooklyn.   

Richard P. Donoghue, 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 James D. Robnett, Special Agent-in-Charge, Internal Revenue Service Criminal Investigation, New York (IRS-CI), announced the charges.  

“As alleged in the indictment, the defendants engaged in an elaborate multi-year scheme to defraud the investing public of millions of dollars through deceit and manipulative stock trading, and then worked to launder the fraudulent proceeds through off-shore bank accounts and the art world, including the proposed purchase of a Picasso painting,” stated United States Attorney Donoghue.  “The charges announced today reflect that this Office, together with our law enforcement partners, is committed to holding accountable those who defraud investors, regardless of the complex schemes they use to hide their ill-gotten gains.”  Mr. Donoghue thanked the U.S. Securities and Exchange Commission (SEC), both the New York Regional Office and the Washington, D.C. Office, the City of London Police, the U.K.’s Financial Conduct Authority and the Hungarian National Bureau of Investigation for their significant cooperation and assistance during the investigation. 

“As alleged, in a series of unscrupulous and illegal trading practices, the defendants contrived a scheme to defraud investors of U.S. publicly traded companies by manipulating stock prices and masking the true ownership of their clients’ financial interests,” stated Assistant Director-in-Charge Sweeney.  “In order to discreetly receive their illegal proceeds, the defendants focused their efforts on laundering the money through a variety of means, including the art world, which they believed was a market free from direct regulation. Bringing to justice securities fraudsters and money laundering facilitators who engage in these types of schemes is and will remain a priority for the FBI and our law enforcement partners worldwide.”

 “Since the Foreign Account Tax Compliance Act has been enacted, the financial expertise of our criminal investigators is needed now more than ever in this global economy,” stated IRS-CI Special Agent-in-Charge Robnett.  “These allegations outline an intricate scheme to obscure beneficial ownership and launder illicit proceeds.  This behavior harms the financial world abroad and here at home.”

Securities Fraud and Money Laundering Scheme

As alleged in the indictment, between March 2014 and February 2018, Beaufort Securities, Beaufort Management, and managers Kyriacou and Canaye, collectively the “Beaufort Defendants,” together with their co-conspirators, engaged in a scheme to defraud investors and potential investors in various U.S. publicly traded companies by concealing the true ownership of various U.S. publicly traded companies and manipulating the price and trading volume in the stocks of those companies. 

Beginning in or about October 2016, an Undercover Agent contacted Kyriacou and stated that he was interested in opening brokerage accounts at Beaufort Securities from which he could execute trades in several multi-million dollar stock manipulation deals.

In furtherance of the scheme, the Beaufort Defendants opened brokerage accounts for their clients in the names of off-shore shell companies with nominee shareholders and directors, and then conducted manipulative trading of stocks of U.S. publicly traded companies listed on U.S. over-the-counter exchanges.  Beaufort Securities facilitated at least ten “pump and dump” schemes involving U.S. publicly traded stocks, generating over $50 million in proceeds for its clients.  Notably, Beaufort Securities had affirmed to the Financial Conduct Authority (“FCA”) in the United Kingdom in July 2016 that it had taken remedial measures to correct deficiencies in the firm’s financial crime controls and anti-money laundering processes. 

Additionally, between January 2011 and February 2018, the Beaufort Defendants; Loyal Bank; Loyal Agency; Baron, the Chief Business Officer of Loyal Bank and a Director of Loyal Agency; and Bullock, the Chief Executive Officer of Loyal Bank and a Director of Loyal Agency, together with their co-conspirators, devised and engaged in a scheme to launder securities fraud proceeds for their clients.  To facilitate this scheme, Beaufort Securities transferred funds to corporate bank accounts at Loyal Bank opened in the names of off-shore shell companies that were controlled by the bank’s clients.  Loyal Bank then provided debit cards to its clients to withdraw funds from those accounts in an untraceable manner to hide the source of the money and facilitate ongoing securities fraud. 

Money Laundering Through Purchase and Sale of Art

Separately, between October 2017 and February 2018, Kyriacou; Aristodemou, the uncle of Kyriacou; and Green, the owner of an art gallery in London, United Kingdom, together with their co-conspirators, agreed to launder £6.7 million, the equivalent of over $9 million dollars, which the Undercover Agent represented to be the proceeds of securities fraud.  After initially proposing the use of real estate investments to launder the funds, the co-conspirators devised a scheme to “clean up the money” through the purchase and subsequent sale of art.  Aristodemou described the art business as the “only market that is unregulated,” and that art was a profitable investment because of “money laundering.”  The defendants proposed the Undercover Agent could purchase from Green a painting by Pablo Picasso entitled “Personnages, Painted 11 April 1965,” and provided paperwork for the painting’s purchase.  The money laundering scheme was halted prior to the transfer of ownership of the painting. 

The FCA also took regulatory action yesterday against Beaufort Securities and a related clearing firm, including halting all regulated activities and initiating insolvency proceedings against both firms.  The SEC filed a civil complaint today against Beaufort Securities and Kyriacou

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

The case is being handled by the Office’s Business and Securities Fraud Section.  Assistant United States Attorneys Jacquelyn M. Kasulis, Michael T. Keilty and David Gopstein are in charge of the prosecution.  The Criminal Division’s Office of International Affairs provided significant assistance in this matter.

The Defendants:

PANAYIOTIS KYRIACOU, also known as “Peter Kyriacou”
Age: 26
Residence: London, England

ARVINSIGH CANAYE, also known as “Vinesh Canaye”
Age: 30
Residence: Mauritius

ADRIAN BARON
Age: 63
Residence: Budapest, Hungary

LINDA BULLOCK
Age: 57
Residence: St. Vincent/Grenadines

ARISTOS ARISTODEMOU
Age: 49
Residence: London, England

MATTHEW GREEN
Age: 50
Residence: London, England

BEAUFORT SECURITIES LTD
London, England

BEAUFORT MANAGEMENT SERVICES LTD
Mauritius

LOYAL BANK LTD
Budapest, Hungary and St. Vincent/Grenadines

LOYAL AGENCY AND TRUST CORP.
St. Vincent/Grenadines

E.D.N.Y. Docket No. 18-CR-102 (ENV)

Earlier today, in federal court in Brooklyn, a complaint was unsealed charging Victor Kingsley, a Brooklyn resident, with using a weapon of mass destruction that resulted in the death of a Queens resident in July 2017, and with the unlawful transportation of explosive materials.  Kingsley used the explosive device in an apparent effort to target New York City Police Department (NYPD) officers.  Kingsley is scheduled to make his initial appearance tomorrow afternoon at the federal courthouse in Brooklyn before United States Magistrate Judge Vera M. Scanlon. 

Richard P. Donoghue, United States Attorney for the Eastern District of New York; John C. Demers, Assistant Attorney General for the National Security Division; William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI); and James P. O’Neill, Commissioner, NYPD, announced the charges.

“As alleged in the complaint, Kingsley used an improvised explosive device in an attempt to target an NYPD officer, and he killed an innocent civilian in the process,” stated United States Attorney Donoghue.  “This Office and our law enforcement partners will use every tool at our disposal to bring to justice those who endanger the community through acts of senseless violence.”  Mr. Donoghue extended his grateful appreciation to the FBI’s Joint Terrorism Task Force (JTTF), which comprises a large number of federal, state and local agencies from the region, the NYPD and the Queen’s County District Attorney’s Office.

 “There is no place in civil society for the spreading of fear through intimidation, violence and destruction,” stated FBI Assistant Director-in-Charge Sweeney.  “I commend the work of the joint FBI-NYPD investigative team for its determination and complete collaboration in bringing this accused criminal to justice.”

“Kingsley’s cowardly act was meant to target a New York City Police Officer for doing his job and resulted in the tragic death of an unintended victim,” said Police Commissioner O’Neill. “This was a case where the NYPD Detective Bureau, Intelligence Bureau, and FBI/NYPD Joint Terrorist Task Force combined their expertise and unique talents to find a needle in a haystack—the clues that would lead to the identification of a bomber who went to great lengths to remain hidden.”

As alleged in the complaint, Kingsley built the explosive device used in the July 28, 2017 murder as part of his broader effort to retaliate violently against several police officers who were part of an NYPD unit that had arrested him in January 2014.  Despite the case against him having eventually been dismissed, Kingsley methodically sought revenge against the officers.  He conducted internet searches and made telephone calls to determine the locations of the officers’ residences.  He also accumulated explosive device components via online purchases made through Amazon, which he had delivered to his house in Brooklyn.  Ultimately, he arranged for the explosive device to be placed outside of the Queens residence where Kingsley mistakenly believed one of his target officers resided.  The building owner inadvertently detonated the device when he tried to open it, and he died as a result of his injuries.

Thereafter, Kingsley continued to acquire explosive device parts.  According to Amazon purchase records, he placed additional orders for explosive device components as recently as earlier this month.

If convicted, Kingsley could face a maximum sentence of life in prison.  The charges in the complaint are merely allegations, and the defendant is presumed innocent unless and until proven guilty.

The government’s case is being prosecuted by the office’s National Security & Cybercrime Section.  Assistant United States Attorney Margaret Lee is in charge of the prosecution with assistance from Trial Attorney Jacqueline L. Barkett of the Counterterrorism Section of the National Security Division.

The Defendant:

Victor C. Kingsley
Age: 37
Brooklyn, New York

Earlier today, a complaint was unsealed charging Bernard Augustine, a United States citizen, with attempting to provide material support to the Islamic State of Iraq and the Levant (ISIL), a foreign terrorist organization.  The defendant is scheduled to make his initial appearance this afternoon at the federal courthouse in Brooklyn before United States Magistrate Judge Vera M. Scanlon.

Richard P. Donoghue, United States Attorney for the Eastern District of New York; John C. Demers, Assistant Attorney General for National Security; William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation (FBI), New York Field Office; and James P. O'Neill, Commissioner, New York City Police Department (NYPD), announced the charges.

“As alleged in the complaint, Augustine sought to travel to Libya to join a violent terrorist organization,” stated United States Attorney Donoghue.  “This Office and our law enforcement partners will continue to work tirelessly to arrest and prosecute aspiring terrorists before they are able to threaten the United States and its allies.”  Mr. Donoghue extended his grateful appreciation to the FBI’s Joint Terrorism Task Force (JTTF), which comprises a large number of federal, state and local agencies from the region. 

“Augustine, a U.S. citizen, traveled halfway around the world with the intent of joining ISIS. Today, that journey ends in a US courtroom to face the justice system for his alleged support for a terrorist organization,” stated FBI Assistant Director-in-Charge Sweeney. “The FBI New York Joint Terrorism Task Force remains dedicated to bringing terrorists to justice wherever they are.  I would like to thank all of our partner agencies for their continued vigilance.”

“Today, as is too often the case, another person was arrested for attempting to provide material support to ISIS,” stated NYPD Commissioner O’Neill.  “Terrorism, violence, and murder is not a pathway to martyrdom. We will continue to arrest anyone who attempts to join or help a terrorist organization. My thanks to the many detectives, agents, and prosecutors whose work on the original Joint Terrorism Task Force here in Manhattan made today’s arrest and charges possible.”  

As alleged in the complaint, the defendant traveled to Tunisia in February 2016.  Upon his arrival in Tunisia, the defendant attempted to travel to Libya to enter ISIL-controlled territory.  The defendant was arrested in Tunisia before he was able to travel into Libya.

After Augustine completed his term of imprisonment in Tunisia, he was subject to expulsion and Tunisian authorities transferred the defendant to the custody of the FBI.

Prior to his departure from the United States, Augustine repeatedly expressed support for ISIL and for individuals who provided support to the foreign terrorist organization’s mission of violent extremism.  In March 2016, JTTF agents obtained a search warrant for the defendant’s laptop computer.  In reviewing the contents of the defendant’s laptop, agents found evidence that, in the months prior to his departure, the defendant had viewed numerous videos that depicted ISIL leaders and fighters, including fighters engaged in acts of violence.  There was also evidence on the laptop that, during the same period, the defendant viewed videos depicting well-known figures who were public supporters of ISIL, or of engaging in violent acts against Westerners, including, among others, Usama Bin Laden and Anwar al-Awlaki.  In addition, the defendant’s Internet search history information revealed that, in the months leading up to his departure from the United States, the defendant actively searched for information on ISIL, how to join ISIL, radical jihadist propaganda and firearms.  Finally, the investigation revealed that, in the weeks leading up to his travel from the United States, the defendant made numerous postings in online forums expressing support for ISIL and violent jihad.

If convicted, Augustine faces a maximum sentence of 20 years in prison.  The charge in the federal complaint is merely an allegation, and the defendant is presumed innocent unless and until proven guilty.

The government’s case is being handled by the Office’s National Security & Cybercrime Section and the Justice Department’s National Security Division.  Assistant United States Attorney Peter Baldwin and Raj Parekh of the Counterterrorism Section of the National Security Division are in charge of the prosecution.

The Defendant:

BERNARD AUGUSTINE
Age:  21
Keyes, California

E.D.N.Y. Docket No. 16-MJ-1107

Earlier today, a complaint was unsealed charging Bernard Augustine, 21, of Keyes, California, with attempting to provide material support to the Islamic State of Iraq and al-Sham (ISIS or ISIL), a designated foreign terrorist organization. 

Assistant Attorney General for National Security John C. Demers, U.S. Attorney Richard P. Donoghue for the Eastern District of New York, Assistant Director in Charge William F. Sweeney, Jr. of the FBI’s New York Field Office and Commissioner James P. O'Neill of the NYPD announced the charges.  The defendant is scheduled to make his initial appearance today at the federal courthouse in Brooklyn, New York before U.S. Magistrate Judge Vera M. Scanlon.

As alleged in the complaint, the defendant traveled to Tunisia in February 2016.  Upon his arrival in Tunisia, the defendant attempted to travel to Libya to enter ISIS-controlled territory.  The defendant was arrested in Tunisia before he was able to travel into Libya.

Prior to his departure from the United States, Augustine repeatedly expressed support for ISIS and for individuals who provided support to the foreign terrorist organization’s mission of violent extremism.  In March 2016, JTTF agents obtained a search warrant for the defendant’s laptop computer.  In reviewing the contents of the defendant’s laptop, agents found evidence that, in the months prior to his departure, the defendant had viewed numerous videos that depicted ISIS leaders and fighters, including fighters engaged in acts of violence.  There was also evidence on the laptop that, during the same period, the defendant viewed videos depicting well-known figures who were public supporters of ISIS or of engaging in violent acts against Westerners, including, among others, Usama Bin Laden and Anwar al-Awlaki.  In addition, the defendant’s Internet search history information revealed that, in the months leading up to his departure from the United States, the defendant actively searched for information on ISIS, how to join ISIS, radical jihadist propaganda and firearms.  Finally, the investigation revealed that, in the weeks leading up to his travel from the United States, the defendant made numerous postings in online forums expressing support for ISIS and violent jihad.

After Augustine completed his term of imprisonment in Tunisia, he was subject to expulsion and Tunisian authorities transferred the defendant to the custody of the FBI.

If convicted, Augustine faces a maximum sentence of 20 years in prison.  The charge in the federal complaint is merely an allegation, and the defendant is presumed innocent unless and until proven guilty.  The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes.  If convicted of any offense, the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.

Mr. Demers and Mr. Donoghue extended their grateful appreciation to the FBI’s Joint Terrorism Task Force (JTTF), which comprises a large number of federal, state and local agencies from the region. 

Assistant U.S. Attorney Peter Baldwin of the Eastern District of New York and Trial Attorney Raj Parekh of the National Security Division’s Counterterrorism Section are in charge of the prosecution.

A two-count indictment was unsealed today in federal court in Brooklyn, charging David Wickham with conspiring to distribute and distributing more than 40 grams of fentanyl in Queens, New York.  The defendant was arrested earlier today and is scheduled to be arraigned this afternoon before United States Magistrate Judge Vera M. Scanlon. 

Richard P. Donoghue, United States Attorney for the Eastern District of New York, Angel M. Melendez, Special Agent-in-Charge, United States Immigration and Customs Enforcement (ICE), Homeland Security Investigations (HSI), New York, and James P. O’Neill, Commissioner, New York City Police Department (NYPD), announced the charges.

“As alleged in court filings, David Wickham sold fentanyl, a powerful opioid with potentially lethal consequences, which he represented to buyers on numerous occasions to be heroin,” stated United States Attorney Donoghue.  “This Office will continue to work tirelessly with our law enforcement partners to prosecute those who contribute to the opioid epidemic plaguing the communities in our District, and to save lives by reducing the availability of the deadly drug.” 

“Fentanyl is a killer, and drug pushers have been taking advantage of selling this highly addictive drug, preying on the vulnerabilities of people,” stated HSI Special Agent-in-Charge Melendez. “Combatting the smuggling and trafficking of fentanyl and opioids is a priority for HSI, and we are committed to work alongside our law enforcement partners to address this problem.”

According to court documents, between August and December 2017, the defendant sold almost 100 grams of fentanyl to an undercover officer.  On several occasions, Wickham represented the narcotics to be heroin—a much less potent narcotic—when it was actually distributing fentanyl.  Also according to court documents, the fentanyl sold by Wickham is linked to two fatal overdoses and one near-fatal overdose based on phone records and a witness’ statements.  During the execution of Wickham’s arrest and the search of his residence and vehicle, pursuant to a search warrant, agents recovered a firearm from under the defendant’s bed, as well as suspected narcotics and drug paraphernalia, including a scale, baggies and hypodermic needles.

According to the Centers for Disease Control and Prevention (CDC) and the Department of Justice, drug overdoses have become the leading cause of death for Americans under the age of 50.  The increase in overdose deaths has been driven in large part by fentanyl—a drug that has been described as 50 to 100 times more potent than morphine.  In New York, from 2014 to 2015, fentanyl overdose deaths rose 135 percent, while heroin overdose deaths rose 28 percent.  According to the CDC’s latest report analyzing overdose deaths nationally, in 2016 synthetic opioid deaths—which includes fentanyl—more than doubled from 9,580 in 2015 to 19,413 in 2016.   

The charges in the indictment are merely allegations, and the defendant is presumed innocent unless and until proven guilty.  If convicted, the defendant faces a mandatory minimum sentence of five years’ imprisonment and up to 40 years’ imprisonment.

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:

DAVID WICKHAM (also known as “Wick” and “Dogg”)
Age: 35
Queens, New York

E.D.N.Y. Docket No. 18-CR-72 (ARR)

A three-count indictment was unsealed earlier today in federal court in Brooklyn charging Michael Foder, a detective with the New York City Police Department (NYPD), with perjury and obstructing an official proceeding in connection with false sworn testimony that Foder gave in a proceeding in United States District Court on December 29, 2016.  The defendant will be arraigned later today before United States Magistrate Judge Vera M. Scanlon.

Richard P. Donoghue, 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 James P. O’Neill, Commissioner, NYPD, announced the charges.

According to the indictment and court filings, Foder falsely testified under oath about when and how he showed photographs of two robbery suspects to a victim of the robbery.  Following the hearing, the government identified several discrepancies in the photo array identifications.  Handwritten notations indicated that the photo arrays had been completed on November 27, 2015 and February 14, 2016, as Foder had testified.  However, the photographs of fillers depicted in the photo arrays had been taken on dates subsequent to the dates Foder claimed he had shown them to the victim witness.  Foder is alleged to have falsified documentation relating to the purported identifications made by the victim.

 “As alleged in the indictment, this defendant provided false testimony in a federal criminal proceeding,” stated United States Attorney Donoghue.  “Our justice system relies upon the absolute integrity of our law enforcement officers and, while the vast majority of officers uphold that standard, we will not hesitate to act when one does not.”

“As alleged, Foder committed a serious crime by lying while under oath. In doing so, he threatened the reputation of the honest men and women of law enforcement who work selflessly to weed out crime and keep their communities safe,” stated FBI Assistant Director-in-Charge Sweeney.  “We hold all officers to the highest standards, and we’ll be quick to respond whenever these ideals are challenged–there are no exceptions.”

“The NYPD and all the people we serve expect the highest levels of integrity and truthfulness from our police officers, who swore an oath to uphold the fundamental principles of our city, state, and nation,” Police Commissioner O’Neill said. “The detective charged today broke that oath by willfully giving false testimony, an act that makes the job of every other police officer more difficult. The NYPD goes to enormous lengths to detect those who break the law or do not follow policies and procedures – from integrity testing by our Internal Affairs Bureau; to auditing of crime and other reports; to regular collaboration with local and federal prosecutors; to proactive training for all police officers, new investigators, and supervisors.”

The charges in the indictment are merely 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 Attorney Nathan Reilly is in charge of the prosecution.

The Defendant:

MICHAEL FODER
Age:  41
Staten Island, NY

E.D.N.Y. Docket No. 18-CR-97 (PKC)

 Earlier today, in federal court in Brooklyn, stock promoter Songkram Roy Sahachaisere was sentenced by United States District Judge Eric N. Vitaliano to 27 months’ imprisonment for participating in a multi-million dollar international market manipulation scheme.  Sahachaisere was convicted in November 2015, following more than five weeks of trial, of conspiring to commit securities fraud, conspiring to commit wire fraud, two counts of wire fraud and one count of securities fraud. 

Richard P. Donoghue, 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.

According to court documents and trial testimony, Sahachaisere participated in an international “pump and dump” operation, which fraudulently pumped up the share price of worthless penny stocks, and then dumped billions of shares on unsuspecting victim investors across the globe.  They “pumped up” the share prices of the companies’ stock by engaging in fraudulent and illegal sales campaigns, which included distributing false press releases, announcing non-existent business ventures and fake mergers, posting false information on Internet message boards and bribing stock promoters.  These schemes fraudulently inflated the value of the shares by approximately $100 million.  Sahachaisere’s role in the scheme was to arrange promoters to “pump” the stocks to potential victims.  Sahachaisere also conspired with other members of the conspiracy to artificially affect the trading price and volume of stocks so that they appeared legitimate to investors.  In addition, the conspiracy used brokerage houses to manipulate transfers of shares, effectuating matched and wash trades in their targeted securities.  Six co-defendants of Sahachaisere were previously convicted and sentenced.  Two co-defendants are awaiting sentencing.

“Songkram Roy Sahachaisere, a licensed broker, defrauded investors across the globe through an international pump and dump scheme,” stated United States Attorney Donoghue.  “His sentence should serve as a warning to those who would consider manipulating the securities markets for their own personal gain.”  Mr. Donoghue extended his grateful appreciation to the FBI, which led the government’s investigation, and thanked the Internal Revenue Service, Criminal Investigation, New York; Homeland Security Investigations, Department of Homeland Security, Buffalo; Treasury Inspector General for Tax Administration; and the Royal Canadian Mounted Police and law enforcement authorities in England, Thailand and China for their assistance in this case.

“Sahachaisere promoted a scheme to overstate the value of stocks and sell them to unwitting investors worldwide,” stated FBI Assistant Director-in-Charge Sweeney.  “This elaborate plan had but one simple intention, which was to profit from the misfortune of others. Today’s sentencing holds him accountable for his crimes.”

The government’s case is being handled by the Office’s Business and Securities Fraud Section.  Assistant United States Attorneys Tyler Smith and Mark Bini are in charge of the prosecution, with assistance provided by Assistant United States Attorney Karin Orenstein of the Office’s Civil Division, which is responsible for the forfeiture of assets.

The Defendant:

SONGKRAM ROY SAHACHAISERE
Age:  48
Newport Beach, California

Defendants Previously Sentenced: SANDY WINNICK
Bangkok, Thailand

GREGORY CURRY
Bangkok, Thailand

GREGORY ELLIS
Ontario, Canada

CORT POYNER
Boca Raton, Florida

WILLIAM SEALS
Fallbrook, California

KOLT CURRY
Ontario, Canada

Defendants Awaiting Sentencing:

GREGORY KERSHNER
Tucson, Arizona

JOSEPH MANFREDONIA
Tom’s River, New Jersey

E.D.N.Y. Docket No. 13-CR-452 (ENV)

Earlier today, at the federal courthouse in Brooklyn, Talib Lokhandwala, a former Construction Project Administrator with the Metropolitan Transit Authority (MTA), was sentenced by Chief United States District Judge Dora L. Irizarry to 46 months’ imprisonment, to be followed by three years of supervised release, after pleading guilty in October 2017 to having solicited and received bribes from two contractors working on two New York City Transit Authority (NYCTA) projects. The Court also imposed a fine of $20,000.

 Richard P. Donoghue, United States Attorney for the Eastern District of New York, Douglas Shoemaker, Special Agent-In-Charge, U.S. Department of Transportation Office of Inspector General (DOT OIG), and Barry L. Kluger, Inspector General, Metropolitan Transportation Authority, announced the sentence.

According to court filings and facts presented at the sentencing, from March 2009 through May 2015, Lokhandwala, who was employed in various positions charged with overseeing MTA construction projects, solicited and received bribes totaling $152,420 from two contractors performing construction projects on NYCTA subway lines.  Lokhandwala concealed his receipt of the bribe payments by having the contractors issue checks to shell bank accounts he controlled.  In exchange for the bribes, Lokhandwala promised to steer future work to the contractors and to expedite bureaucratic paperwork for their benefit.  Lokhandwala threatened to bar the contractors from future projects if they did not continue to pay him. 

“Motivated by greed, Lokhandwala abused his position of trust by soliciting and accepting bribes from contractors performing work on NYCTA projects,” stated United States Attorney Donoghue.  “The public has the right to expect that contractors performing work on their behalf are selected on merit, not their willingness to line the pockets of government employees with bribe payments.  Our Office is committed to ensuring that public officials who accept bribes are held accountable.”  Mr. Donoghue expressed his appreciation to the United States Department of Transportation and to the MTA Inspector General for their assistance during the investigation.

“This sentencing demonstrates that those entrusted with the stewardship of taxpayer dollars and oversight of transportation infrastructure projects will be held accountable for maintaining the highest level of integrity,” said DOT OIG Special Agent-in-Charge Shoemaker.  “Working with our law enforcement and prosecutorial partners, we will continue our vigorous efforts in preventing, detecting and prosecuting fraud involving DOT programs and funds.”

“I thank the United States Attorney’s Office for having moved aggressively and effectively to prosecute these criminal acts that undermine the integrity of the public contracting process,” stated MTA Inspector General Kluger.  “I will continue to refer such misconduct to my law enforcement partners for vigorous investigation and prosecution.  I also want to remind those who do business with the MTA of their obligations, to both the MTA and the public, to report any solicitations or requested bribes.”

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

The Defendant:

TALIB LOKHANDWALA
Age: 64
Residence: Fair Lawn, New Jersey

E.D.N.Y. Docket No. 17-CR-517 (DLI)

WASHINGTON – Attorney General Jeff Sessions and law enforcement partners announced today the largest coordinated sweep of elder fraud cases in history.  The cases involve more than two hundred and fifty defendants from around the globe who victimized more than a million Americans, most of whom were elderly.  The cases include criminal, civil, and forfeiture actions across more than 50 federal districts.  Of the defendants, 200 were charged criminally.  In each case, offenders engaged in financial schemes that targeted or largely affected seniors.  In total, the charged elder fraud schemes caused losses of more than half a billion dollars.  The Department coordinated its announcement with the FTC and state Attorneys General, who independently filed numerous cases targeting elder frauds within the sweep period.

Attorney General Sessions was joined in the announcement by FBI Acting Deputy Director David Bowdich; Chief Postal Inspector Guy Cottrell; FTC Acting Chairman Maureen Ohlhausen; and Kansas Attorney General and President of the National Association of Attorneys General Derek Schmidt.

“The Justice Department and its partners are taking unprecedented, coordinated action to protect elderly Americans from financial threats, both foreign and domestic,” said Attorney General Sessions.  “Today’s actions send a clear message:  we will hold perpetrators of elder fraud schemes accountable wherever they are.  When criminals steal the hard-earned life savings of older Americans, we will respond with all the tools at the Department’s disposal – criminal prosecutions to punish offenders, civil injunctions to shut the schemes down, and asset forfeiture to take back ill-gotten gains.  Today is only the beginning.  I have directed Department prosecutors to coordinate with both domestic law enforcement partners and foreign counterparts to stop these criminals from exploiting our seniors.”

The actions charged a variety of fraud schemes, ranging from mass mailing, telemarketing and investment frauds to individual incidences of identity theft and theft by guardians.  A number of cases involved transnational criminal organizations that defrauded hundreds of thousands of elderly victims, while others involved a single relative or fiduciary who took advantage of an individual victim.  The schemes charged in these cases caused losses to more than a million victims.

“Winners. That’s what so many of the people who received these solicitations in the mail thought they were. But they’re not. They are victims of scams that Postal Inspectors have seen and investigated for decades. In fact, some of the same operators we encountered 20 years ago are back. But so are we. Yesterday, Postal Inspectors around the country executed search warrants on 12 locations that some of these same operators used to run their scams. We’re letting the American public know – and especially our vulnerable older Americans – that Postal Inspectors are working hard to protect them and ensure their confidence in the U.S. Mail,” said Chief Postal Inspector Cottrell.

“Over the last year, the FBI has initiated more than 200 financial crimes cases involving elderly victims who were devastated financially, emotionally, mentally and physically. Picking up the pieces of these fraud schemes can be equally as traumatizing for the caregivers of these elderly victims,” said Acting Deputy Director Bowdich.  “The FBI reminds seniors and their caregivers to be vigilant. If any person believes they are the victim of, or have knowledge of fraud involving an elderly person, regardless of the loss amount, they should report it to the FBI.”

Actions against mass-mailing fraud industry

As part of the initiative, the Department’s Consumer Protection Branch, working with the U.S. Attorney’s Office for the Eastern District of New York and others, brought numerous cases this past week in a coordinated strike against more than 43 mass-mailing fraud operators, including criminal charges against six individuals.  In addition, law enforcement agents executed 14 premises search warrants from Las Vegas to south Florida, served numerous asset seizure warrants, and coordinated with the Vancouver Police in Canada, who executed over 20 warrants, including search warrants on business premises.

“The defendants targeted elderly and vulnerable consumers both in the United States and abroad, using U.S. addresses and the U.S. mails to try to legitimize their fraudulent schemes,” said U.S. Attorney for the Eastern District of New York Richard P. Donoghue.  “They sold false promises of life-changing prizes that never came true.  We will pursue the perpetrators of these mail schemes wherever they are located, and hold them accountable.”

These recently filed cases particularly targeted transnational criminal actors who collectively defrauded at least a million victims out of hundreds of millions of dollars.  Indeed, just one of the schemes prosecuted criminally by the Consumer Protection Branch operated from 14 foreign countries to cost American victims more than $30 million.  Click here for map showing a transnational, single fraud scheme.

Mass-mailing fraud inflicts hundreds of millions of dollars in losses to elderly U.S. victims each year.  Department prosecutors and U.S. Postal Inspectors have taken a comprehensive approach to combatting this fraud, disrupting and prosecuting individuals who manage the schemes, artists who draft the fraudulent solicitations, list brokers who supply victim lists, and individuals who collect victim payments. Click here for fact-sheet with cases on mass-mailing fraud.

Actions against other elder fraud schemes

Prosecutors across the country from the Criminal Division’s Fraud Section, the Consumer Protection Branch and the U.S. Attorney’s Offices have heeded the call to focus resources on elder fraud cases.  Over 50 U.S. Attorney’s Offices and Department Components filed elder fraud cases in the last year.  Some examples of the elder financial exploitation prosecuted by the Department include:

• “Lottery phone scams,” in which callers convince seniors that a large fee or taxes must be paid before one can receive lottery winnings;
• “Grandparent scams,” which convince seniors that their grandchildren have been arrested and need bail money;
• “Romance scams,” which lull victims to believe that their online paramour needs funds for a U.S. visit or some other purpose;
• “IRS imposter schemes,” which defraud victims by posing as IRS agents and claiming that victims owe back taxes;
• “Guardianship schemes,” which siphon seniors’ financial resources into the bank accounts of deceitful relatives or guardians.

Many of these cases illustrate how an elderly American can lose his or her life savings to a duplicitous relative, guardian, or stranger who gains the victim’s trust.  The devastating effects these cases have on victims and their families, both financially and psychologically, make prosecuting elder fraud a key Department priority.

Public education

The Department has partnered with Senior Corps, a national service program administered by the federal agency the Corporation for National and Community Service, to educate seniors and prevent further victimization. The Senior Corps program engages more than 245,000 older adults in intensive service each year, who in turn, serve more than 840,000 additional seniors, including 332,000 veterans.

Using its vast network operating in more than 30,000 locations, Senior Corps volunteers will communicate about elder fraud to potential victims across the country and will use their skills, knowledge and experience to educate their peers and caregivers about the most prolific types of schemes and how to avoid them. Click here for information on Senior Corps’ efforts to reduce elder fraud.

Coordination with state officials

Kansas Attorney General Schmidt highlighted the cases filed by state Attorneys General targeting elder frauds within in the sweep period, and he emphasized efforts at the state level to combat elder abuse and protect seniors from fraud and exploitation.  He encouraged all of the state Attorneys General to devote enforcement and public education resources to preventing financial exploitation of senior citizens.

Coordination with foreign law enforcement

Exceptional assistance from foreign law enforcement partners amplified the effectiveness of the Department’s initiative.  The sweep announced today benefited greatly from the work of the International Mass-Marketing Fraud Working Group (IMMFWG), a network of civil and criminal law enforcement agencies from Australia, Belgium, Canada, Europol, the Netherlands, Nigeria, Norway, Spain, the United Kingdom and the United States.  The IMMFWG is co-chaired by the U.S. Department of Justice and FTC, and law enforcement in the United Kingdom, and serves as a model for international cooperation against specific threats that endanger the financial well-being of each member country’s residents.  Attorney General Sessions expressed gratitude for the outstanding efforts of the working group, including law enforcement action taken as part of the sweep by the Vancouver Police Department in Canada to halt mass mailing schemes that defrauded hundreds of thousands of elderly victims worldwide.

Elder fraud complaints

Elder fraud complaints may be filed with the FTC at www.ftccomplaintassistant.gov or at 877-FTC-HELP.  The Department of Justice provides a variety of resources relating to elder fraud victimization through its Office of Victims of Crime, which can be reached at www.ovc.gov. 

Earlier today, in federal court in Brooklyn, Giovanni Zannoni, an Italian national and member of the Italian armed services, was sentenced by United States District Judge Pamela K. Chen to 11 months’ imprisonment for illegally exporting and attempting to export controlled military technology from the United States to Italy.  Zannoni previously pled guilty to the sole count of the information on December 21, 2017.  Zannoni was also ordered to forfeit gun parts, night vision goggles and thermal imaging devices, including an Army/Navy PVS-7D night vision goggle, a mini thermal monocular, numerous parts and magazines for AR-15 and M4 semi-automatic assault rifles and image intensifiers.  As part of his plea agreement, Zannoni also agreed to forfeit $436,673.73.

Richard P. Donoghue, United States Attorney for the Eastern District of New York, announced the sentencing.  Mr. Donoghue thanked the Department of Defense, Defense Criminal Investigative Service, Northeast Field Office (DCIS), and U.S. Immigration and Customs Enforcement (ICE), Homeland Security Investigations (HSI), New York, for their hard work and dedication over the course of this investigation and prosecution.

According to court filings, between June 2013 and May 2017, Zannoni illegally exported and attempted to export night vision goggles and assault rifle components that have been designated as defense articles on the United States Munitions List.  To lawfully export these devices, the United States Department of State requires the obtaining of a license because these items make a significant contribution to the military potential and weapons proliferation by other nations, which could be detrimental to the foreign policy and national security of the United States.  

To carry out this scheme, the defendant purchased export-controlled devices from U.S.-based manufacturers or distributors or through Internet-based marketplaces like eBay.com.  Zannoni then directed the sellers of the export-controlled products to ship them to freight forwarders in the United States, and made false statements to the freight forwarders about the contents and values of the packages, so that the packages would be exported to Italy without the required licenses.  Records show that the defendant purchased approximately 2,700 night vision or thermal imaging devices, image intensifiers and pieces of body armor, and that he paid approximately $530,000 for these export-controlled devices between June 2013 and May 2017. 

The government’s case is being handled by the Office’s General Crimes Section.  Assistant United States Attorney Nomi D. Berenson is in charge of the prosecution, with assistance from Trial Attorney Matthew Walczewski of the National Security Division’s Counterintelligence and Export Control Section.

The Defendant:

GIOVANNI ZANNONI
Age:  35
Residence: Gavorrano, Italy

E.D.N.Y. Docket No. 17-CR-565 (PKC)

Earlier today, a two-count indictment was unsealed in federal court in Central Islip, New York, charging Richard “Rob” Walker, the former Chief Deputy County Executive under Nassau County Executive Edward Mangano, with obstruction of justice and making false statements.  Walker’s arraignment on the indictment will take place at 12:00 p.m. this afternoon before United States Magistrate Judge Anne Y. Shields in Courtroom 830.

Richard P. Donoghue, 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 charges. 

“As alleged in the indictment, the defendant Walker, while holding public office, attempted to obstruct a grand jury investigation and then lied to the FBI,” stated U.S. Attorney Donoghue.  “Lying and obstructing justice by those who are sworn to serve the public will never be tolerated.  This Office, together with our law enforcement partners, is committed to holding officials who violate the public trust accountable for such crimes.”  Mr. Donoghue expressed his thanks to Internal Revenue Service Criminal Investigation for its help during the investigation.

“As alleged, Rob Walker, while serving as a public official, accepted money from a contractor who was performing work for Nassau County. When he found out the FBI was hot on his trail, he tried to cover up his corrupt behavior, even going so far as to attempt to convince the contractor to lie to a grand jury,” stated FBI Assistant Director-in-Charge Sweeney.  “Walker and others who engage in similar schemes are reminded today that there’s no way to undo what’s already been done.”

As alleged in the indictment and other court papers, in 2014, the defendant, who was the Chief Deputy Nassau County Executive at the time, accepted a $5,000 cash payment from a Nassau County contractor who was performing work for Nassau County pursuant to a county contract.  In 2017, once the defendant learned that the United States Attorney’s Office for the Eastern District of New York and the FBI had opened a grand jury investigation of potential corruption in Nassau County government, including the circumstances surrounding the $5,000 payment made by the contractor to the defendant, the defendant spoke with the contractor on several occasions in an attempt to convince the contractor to conceal the existence of the $5,000 payment from the grand jury.  Further, the defendant urged the contractor to provide a false explanation to the grand jury concerning the reasons for the payment.  Finally, the defendant arranged to meet the contractor in a park in Hicksville, New York in order to return the $5,000.  The FBI surveilled the meeting, and at that meeting, the defendant gave the contractor an envelope containing $5,000, which was then turned over to law enforcement.  Thereafter, the defendant, when interviewed by the FBI concerning the payment, denied ever having received any cash payments from the contractor.   

The charges announced today are merely allegations and the defendant is presumed innocent unless and until proven guilty.

The government’s case is being handled by the Office’s Long Island Criminal Division.  Assistant United States Attorneys Catherine M. Mirabile, Raymond A. Tierney and Lara Treinis Gatz are in charge of the prosecution.

The Defendant:

Richard Walker (also known as “Rob” Walker)
Age: 43
Hicksville, New York

E.D.N.Y. Docket No. 18-CR-087 (JMA)

Earlier today, in federal court in Brooklyn, Mimo International Imports and Exports, Inc. (Mimo) pleaded guilty to wire fraud conspiracy in connection with its agreement to pay a $500,000 bribe to Eduardo Li, who was president of the Costa Rican soccer federation (FEDEFUT) at the time of the bribe.  Mimo, which is a privately held corporation organized under the laws of Panama, paid over $300,000 of this agreed-upon bribe before Li was arrested in Zurich, Switzerland on May 27, 2015.  Pursuant to a plea agreement with the government, Mimo was sentenced today to pay $500,000 in restitution to FEDEFUT and a $900,000 fine.  Also pursuant this plea agreement, Mimo agreed to dissolve its corporate existence within 90 days.  Today’s plea and sentencing proceedings took place before United States District Judge Pamela K. Chen.

Richard P. Donoghue, 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 R. Damon Rowe, Special Agent-in-Charge, Internal Revenue Service Criminal Investigation, Los Angeles Field Office (IRS CI), announced the guilty plea.

“The defendant company Mimo agreed to bribe the president of the Costa Rican soccer federation, depriving the federation of $500,000 as well as of its president’s honest services,” stated U.S. Attorney Donoghue.  “As a result of the government’s investigation bringing this bribery scheme to light, Mimo admitted its guilt and will make full restitution to the federation, pay a $900,000 fine, and cease operations.” 

“This plea is just one in an increasing pile of investigations and cases the FBI and our law enforcement partners from around the world have been pursuing for years,” stated FBI Assistant Director-in-Charge Sweeney.   “It shows we're not slowing down in our efforts to stop greedy, criminal behavior casting a dark shadow on a game the world reveres.  There will be more to come, and we won't stop until those who take money under the table and use it for their own illicit purposes get the message that they will get caught.”

“Today’s guilty plea is a clear demonstration of IRS Criminal Investigation’s continued commitment to pursue financial crimes, including those which further corruption in the world of international soccer,” stated IRS CI Special Agent-in-Charge Rowe.  “IRS CI is committed to ending these practices and bringing bad actors, including corporate entities, to justice.”

According to court filings and facts presented during the plea proceeding, Mimo provided athletic apparel and sponsorship fees to FEDEFUT pursuant to a 2012 sponsorship agreement that was to run through 2018.  In 2014, Mimo sought for FEDEFUT to terminate the 2012 sponsorship agreement, because if FEDEFUT terminated that agreement, Mimo’s owners would receive a multi-million dollar rescission fee.  To induce Li to terminate the 2012 sponsorship agreement, Mimo agreed to pay Li a bribe of $500,000. 

Li then terminated the 2012 agreement and on behalf of FEDEFUT entered into a sponsorship agreement with an American sports apparel company.  Mimo paid Li over $300,000 of the $500,000 bribe, in United States currency, before Li’s arrest on May 27, 2015 in Zurich, Switzerland.  Mimo representatives did not tell the American sports apparel company about the bribe, and told Li not to tell the American sports apparel company about it.  Li pleaded guilty to racketeering conspiracy and other offenses on October 7, 2016, and admitted in his allocution, among other things, that he had agreed to this bribe.

The guilty plea announced today is part of an 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.  The prosecutors in Brooklyn are receiving 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. 

The government’s case is being handled by the Office’s FIFA Task Force.  Assistant United States Attorney Paul Tuchmann of the Eastern District of New York is in charge of the prosecution.

The Defendant:

MIMO INTERNATIONAL IMPORTS AND EXPORTS, INC.
Place of Incorporation:  Panama

E.D.N.Y. Docket No. 18 CR 59 (PKC)

A six-count indictment was unsealed earlier today in federal court in Brooklyn charging Christian Hicks, Timel McRae, Stanley Valon and Roman Guevara with conspiracy to commit bank fraud, bank fraud, access device fraud and aggravated identity theft in connection with a scheme to obtain funds from financial institutions by using victims’ personally identifiable information.  Defendant Roman Guevara will be arraigned later today at the United States Courthouse in San Jose, California.  Defendant Stanley Valon will be arraigned later today at the United States Courthouse in Allentown, Pennsylvania.  Defendants Christian Hicks and Timel McRae were previously arrested on a complaint, and their arraignment on the indictment will be scheduled later this month.

Richard P. Donoghue, 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 charges.

“As alleged in the indictment, the defendants used other people’s personally identifiable information, together with false information, to obtain loans by fraud and steal money from banks,” stated United States Attorney Donoghue.  “This Office, together with our law enforcement partners, is committed to protecting our financial system from those who use fraud to line their own pockets.”

“As alleged, the defendants falsely represented their financial standing at the expense of others in order to receive loans and credit offers they didn’t qualify for—plain and simple,” stated FBI Assistant Director-in-Charge Sweeney. “This is not a crime to be taken lightly, and as our charges today prove, this type of dishonorable behavior will not go unpunished.”   

According to court filings, the defendants obtained other persons’ personally identifiable information, such as their dates of birth and social security numbers, by promising, among other things, to enter into joint vehicle ownership ventures with those persons or to improve their credit scores.  After securing this information, the defendants used it, as well as false employment and salary information contained in forged documents they generated, to apply for automobile loans, obtain credit cards and secure lines of credit in the other persons’ names.  The defendants used all of the funds provided by financial institutions as a result for their own purposes and not, as they had promised, to enter into joint vehicle ownership or improve anyone’s credit scores.  In the course of their fraudulent scheme, the defendants applied to financial institutions for automobile loans, lines of credit and credit cards with a value of more than $1.5 million.

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

The Defendants:

CHRISTIAN HICKS
Age:  41
Queens, New York

TIMEL MCRAE
Age:  41
Brooklyn, New York

STANLEY VALON
Age: 33
Hempstead, New York

ROMAN GUEVARA
Age:  48
Sunnyvale, California

E.D.N.Y. Docket No. 18-CR-0085 (MKB) (VMS)

Earlier today, in Brooklyn federal court, al-Qaeda operative Ibrahim Suleiman Adnan Adam Harun was sentenced to life imprisonment by United States District Judge Brian M. Cogan following his March 16, 2017 trial conviction of multiple terrorism offenses, including conspiracy to murder American military personnel in Afghanistan, conspiracy to bomb the U.S. Embassy in Nigeria, and providing material support to al-Qaeda.

Richard P. Donoghue, United States Attorney for the Eastern District of New York, Edward C. O’Callaghan, Acting Assistant Attorney General for National Security, William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and James P. O’Neill, Commissioner, New York City Police Department (NYPD), announced the sentence.

“This case demonstrates our commitment to bringing to justice those who target American citizens serving their country abroad.  We will be relentless in our efforts to hold terrorists like the defendant accountable for their crimes,” stated United States Attorney Donoghue. 

“With the sentence handed down today, our justice system has once again held accountable an al-Qaeda operative for his terrorist activities, ensuring that he will spend the rest of his life in prison,” stated Acting Assistant Attorney General O’Callaghan.  “The evidence presented at trial established that the defendant and other jihadists attacked a U.S. military patrol in Afghanistan, resulting in the death of two American soldiers and the serious injury of others.  Working with our partners in the law enforcement and intelligence communities, the National Security Division will continue to vigorously pursue and disrupt terrorists who target Americans and American facilities around the world.  Thank you to the many agents, analysts, and prosecutors whose hard work and dedication made this result possible.”

Mr. Donoghue and Mr. O’Callaghan expressed their grateful appreciation to the FBI’s Joint Terrorism Task Force, the Department of Justice’s Office of International Affairs, the Department of Defense Army investigators, the Office of Military Commissions, the Italian Ministry of Justice, the Prosecutor’s Office in Palermo, Italy, the Italian National Police, Guardia di Finanza and Carabinieri authorities for their support and assistance.

“Justice has been served on behalf of the victims of Spin Ghul’s grisly attack on U.S. military patrol members in 2003,” stated FBI Assistant Director-in-Charge Sweeney. “This al-Qaeda operative will no longer pose a threat to society.  The FBI’s Joint Terrorism Task Force in New York is committed to working with our partners here and abroad to bring terrorists to justice.”

“Harun was a dedicated and early soldier in bin Laden’s al-Qaeda, joining just weeks before the September 11th attacks,” stated NYPD Police Commissioner O’Neill. “He launched attacks against US service members in Afghanistan in 2003, killing two and injuring many others. After, he attempted to bomb the U.S. Embassy in Nigeria, among other western targets. Harun will rightfully spend the rest of his life behind bars. This department—with our partners in law enforcement— remains deeply committed to combating terrorism from New York to Nigeria—and everywhere in between.”

As proven at trial, Harun (also known as “Spin Ghul”) traveled from Saudi Arabia to Afghanistan weeks before September 11, 2001, where he joined al-Qaeda, trained at al-Qaeda training camps, and eventually swore allegiance to Osama bin Laden.  Harun then traveled with other al-Qaeda jihadists to the Federally Administered Tribal Areas of Pakistan, where he operated under Abdul Hadi al-Iraqi, one of bin Laden’s deputies and a senior al-Qaeda military commander.

On April 25, 2003, Harun and fellow al-Qaeda jihadists ambushed a U.S. military patrol near the Afghan-Pakistan border.  Harun fired machinegun rounds and threw grenades at American soldiers and allied Afghan Militia Forces while shouting “Allahu Akbar” or “God is Great.”  Two U.S. servicemen were killed in the attack—Private First Class Jerod Dennis, 19, of Oklahoma, and Airman First Class Raymond Losano, 24, of Texas—and several other soldiers were seriously wounded. 

After the ambush, Harun met with senior al-Qaeda officials—including Abu Faraj al-Libi, then al-Qaeda’s external operations chief—to express his desire to commit acts of terror against U.S. interests outside Afghanistan.  He specifically sought to carry out attacks similar to the 1998 al-Qaeda bombings of the U.S. Embassies in Kenya and Tanzania, which resulted in more than 200 deaths and 4,000 injuries.

In the summer of 2003, senior al-Qaeda leaders dispatched Harun from Pakistan to Nigeria to bomb the U.S. Embassy in Abuja.  Harun’s al-Qaeda handler directed him to obtain one ton of explosives for the bombing operation and to target Americans—whom he described as “the head of the snake”—at embassies, hotels and other “places where they gather for fun.”  Upon arriving in Nigeria, Harun recruited accomplices, scouted the Embassy and other potential Western targets, and sent an accomplice to find explosives.  He also met with local terrorist leaders to expand al-Qaeda’s terrorist network in West Africa.

In 2004, Harun directed a coconspirator to courier information and materials from Nigeria to al-Qaeda leaders in Pakistan.  After learning that the coconspirator had been arrested in Pakistan, Harun fled Nigeria to Libya, from where he planned to enter Europe to carry out terrorist attacks against Western interests.  In early 2005, however, Harun was arrested by Libyan authorities and held in custody until his release in June 2011.  Harun was arrested in June 2011 by Italian authorities.  He was indicted on terrorism charges in the United States in February 2012 and extradited from Italy to the United States later that year. 

The government’s case was prosecuted by the Office’s National Security & Cybercrime Section.  Assistant U.S. Attorneys Shreve Ariail, Melody Wells, and Matthew J. Jacobs of the United States Attorney’s Office for the Eastern District of New York, along with Joseph N. Kaster, Trial Attorney, Counterterrorism Section of the Justice Department’s National Security Division, were in charge of the prosecution.

The Defendant:

IBRAHIM SULEIMAN ADNAN ADAM HARUN
Age: 47

E.D.N.Y. Docket No. 12-CR-134

Mohamed Rafik Naji, 38, of Brooklyn, New York, pleaded guilty today to one count of attempting to provide material support or resources to the Islamic State of Iraq and al-Sham (ISIS), a designated foreign terrorist organization. 

Acting Assistant Attorney General for National Security Edward C. O’Callaghan, U.S. Attorney Richard P. Donoghue, Assistant Director in Charge William F. Sweeney of the FBI’s New York Field Office and Commissioner James P. O’Neill of the NYPD announced the guilty plea.  The plea was accepted by U.S. District Judge Frederic Block.

As detailed in publicly filed court documents, Naji, a lawful permanent resident originally from Yemen, viewed and distributed ISIS propaganda before traveling from New York to Yemen in March 2015 in an effort to join ISIS.  While in Yemen, Naji repeatedly tried to travel to areas controlled by ISIS, explaining in emails with an associate in the United States that he was on his fifth attempt to reach ISIS.  Naji described traveling through militarized zones and claimed that he and his group had almost been “killed . . . by army.”  In addition, he explained that “we have trouble getting in the party” because there were “to[o] many security [g]uards all ova the place” that would “kill us if they find us.”  Naji also sent his associate videos that he made in Yemen.  In one of the videos that was attached to an email with the subject line “First day on the job,” Naji’s voice can be heard over the sound of automatic weapons saying “I think we’re taking fire.”  Naji also sent his associate ISIS propaganda videos.  In addition, in an online conversation, Naji proclaimed his allegiance to ISIS stating, “I belong to Islamic state only.” 

Following his return to the United States in September 2015, Naji continued to express his support for ISIS and violent jihad.  For example, he explained ways to travel to ISIS-controlled territory in Syria by crossing the Turkish border, and how to employ strategies to avoid arrest in Turkey.  In July 2016, following the ISIS-inspired terrorist truck attack in Nice, France, Naji discussed how easy it would be to carry out a similar attack in Times Square, explaining that ISIS “want an operation in Times Square” and stating that an ISIS “reconnaissance group . . . put up scenes of Times Square.”  Naji further explained “if there is a truck, I mean a garbage truck and one drives it there to Times Square and crushes them…Times Square day.”  He was arrested by members of the New York JTTF in the autumn of 2016.  At sentencing, Naji faces a statutory maximum term of 20 years’ imprisonment. 

Mr. O’Callaghan and Mr. Donoghue extended their grateful appreciation to the FBI’s Joint Terrorism Task Force (JTTF), which comprises a number of federal, state and local agencies from the region.

This case was prosecuted by Assistant U.S. Attorneys Ian C. Richardson and Melody Wells of the Eastern District of New York, with assistance from Trial Attorney Brian Morgan of the National Security Division’s Counterterrorism Section.

Earlier today in federal court in Brooklyn, Mohamed Rafik Naji pleaded guilty before United States District Judge Frederic Block to one count of attempting to provide material support or resources to the Islamic State of Iraq and al-Sham (ISIS), a foreign terrorist organization.  

United States Attorney Richard P. Donoghue, Acting Assistant Attorney General for National Security Edward O’Callaghan, Assistant Director-in-Charge William F. Sweeney, Jr., of the New York Field Office of the Federal Bureau of Investigation (FBI), and James P. O’Neill, Commissioner, New York City Police Department (NYPD), announced the guilty plea.

Mr. Donoghue extended his grateful appreciation to the FBI’s Joint Terrorism Task Force (JTTF), which comprises a number of federal, state and local agencies from the region. 

 As detailed in publicly filed court documents, Naji viewed and distributed ISIS propaganda before traveling from New York to Yemen in March 2015 in an effort to join ISIS.  While in Yemen, Naji repeatedly tried to travel to areas controlled by ISIS, explaining in emails with an associate in the United States that he was on his fifth attempt to reach ISIS.  Naji described traveling through militarized zones and claimed that he and his group had almost been “killed . . . by army.”  In addition, he explained that “we have trouble getting in the party” because there were “to[o] many security [g]uards all ova the place” that would “kill us if they find us.”  Naji also sent his associate videos that he made in Yemen.  In one of the videos that was attached to an email with the subject line “First day on the job,” Naji’s voice can be heard over the sound of automatic weapons saying “I think we’re taking fire.”  Naji also sent his associate ISIS propaganda videos.  In addition, in an online conversation, Naji proclaimed his allegiance to ISIS stating, “I belong to Islamic state only.” 

Following his return to the United States in September 2015, Naji continued to express his support for ISIS and violent jihad.  For example, he explained ways to travel to ISIS-controlled territory in Syria by crossing the Turkish border, and how to employ strategies to avoid arrest in Turkey.  In July 2016, following the ISIS-inspired terrorist truck attack in Nice, France, Naji discussed how easy it would be to carry out a similar attack in Times Square, explaining that ISIS “want an operation in Times Square” and stating that an ISIS “reconnaissance group . . . put up scenes of Times Square.”  Naji further explained “if there is a truck, I mean a garbage truck and one drives it there to Times Square and crushes them…Times Square day.”  He was arrested by members of the New York JTTF in the autumn of 2016.  At sentencing, Naji faces a statutory maximum term of 20 years’ imprisonment. 

The government’s case is being handled by the Office’s National Security & Cybercrime Section.  Assistant United States Attorneys Ian C. Richardson and Melody Wells were in charge of the prosecution, with assistance from Trial Attorney Brian Morgan of the National Security Division’s Counterterrorism Section.

The Defendant:

MOHAMED RAFIK NAJI
Age: 38
Brooklyn, New York

E.D.N.Y. Docket No.  16-CR-653 (FB)

Earlier today, Al-Qaeda operative Ibrahim Suleiman Adnan Adam Harun, aka Spin Ghul, 47, was sentenced to life in prison following his March 16, 2017 trial conviction of multiple terrorism offenses, including conspiracy to murder American military personnel in Afghanistan, conspiracy to bomb the U.S. Embassy in Nigeria, and providing material support to al-Qaeda.

Acting Assistant Attorney General for National Security Edward O’Callaghan, U.S. Attorney Richard P. Donoghue for the Eastern District of New York, Assistant Director in Charge William F. Sweeney, Jr. of the FBI’s New York Field Office and Commissioner James P. O’Neill of the NYPD made the announcement. The sentence was issued by U.S. District Judge Brian M. Cogan.

“With the sentence handed down today, our justice system has once again held accountable an al-Qaeda operative for his terrorist activities, ensuring that he will spend the rest of his life in prison,” said Acting Assistant Attorney General O’Callaghan.  “The evidence presented at trial established that the defendant and other jihadists attacked a U.S. military patrol in Afghanistan, resulting in the death of two American soldiers and the serious injury of others.  Working with our partners in the law enforcement and intelligence communities, the National Security Division will continue to vigorously pursue and disrupt terrorists who target Americans and American facilities around the world.  Thank you to the many agents, analysts and prosecutors whose hard work and dedication made this result possible.”

“This case demonstrates our commitment to bringing to justice those who target American citizens serving their country abroad.  We will be relentless in our efforts to hold terrorists like the defendant accountable for their crimes,” said U.S. Attorney Donoghue. 

“Justice has been served on behalf of the victims of Spin Ghul's grisly attack on U.S. military patrol members in 2003,” said Assistant Director in Charge Sweeney.  “This al-Qaeda operative will no longer pose a threat to society.  The FBI's Joint Terrorism Task Force in New York is committed to working with our partners here and abroad to bring terrorists to justice.”

“Harun was a dedicated and early soldier in Bin Laden’s al Qaeda, joining just weeks before the September 11th attacks,” said Commissioner O’Neill.  “He launched attacks against U.S. service members in Afghanistan in 2003, killing two and injuring many others . After, he attempted to bomb the U.S. Embassy in Nigeria, among other western targets. Harun will rightfully spend the rest of his life behind bars. This department — with our partners in law enforcement —  remains deeply committed to combating terrorism from New York to Nigeria — and everywhere in between.”

As proven at trial, Harun traveled from Saudi Arabia to Afghanistan weeks before Sept. 11, 2001, where he joined al-Qaeda, trained at al-Qaeda training camps, and eventually swore allegiance to Usama bin Laden.  Harun, also known by the nom de guerre “Spin Ghul,” a Pashto name meaning “White Rose,” then traveled with other al-Qaeda jihadists to the Federally Administered Tribal Areas of Pakistan, where he operated under Abdul Hadi al-Iraqi, one of bin Laden’s deputies and a senior al-Qaeda military commander.

On April 25, 2003, Harun and fellow al-Qaeda jihadists ambushed a U.S. military patrol near the Afghan-Pakistan border.  Harun fired machinegun rounds and threw grenades at American soldiers and allied Afghan Militia Forces while shouting “Allahu Akhbar” or “God is Great.”  Two U.S. servicemen were killed in the attack — Private First Class Jerod Dennis, 19, of Oklahoma, and Airman First Class Raymond Losano, 24, of Texas — and several other soldiers were seriously wounded. 

After the ambush, Harun met with senior al-Qaeda officials — including Abu Faraj al-Libi, then al-Qaeda’s external operations chief — to express his desire to commit acts of terror against U.S. interests outside Afghanistan.  He specifically sought to carry out attacks similar to the 1998 al-Qaeda bombings of the U.S. Embassies in Kenya and Tanzania, which resulted in more than 200 deaths and 4,000 injuries.

In the summer of 2003, senior al-Qaeda leaders dispatched Harun from Pakistan to Nigeria to bomb the U.S. Embassy in Abuja.  Harun’s al-Qaeda handler directed him to obtain one ton of explosives for the bombing operation and to target Americans — whom he described as “the head of the snake” — at embassies, hotels and other “places where they gather for fun.”  Upon arriving in Nigeria, Harun recruited accomplices, scouted the Embassy and other potential Western targets, and sent an accomplice to find explosives.  He also met with local terrorist leaders to expand al-Qaeda’s terrorist network in West Africa.

In 2004, Harun directed a coconspirator to courier information and materials from Nigeria to al-Qaeda leaders in Pakistan.  After learning that the coconspirator had been arrested in Pakistan, Harun fled Nigeria to Libya, from where he planned to enter Europe to carry out terrorist attacks against Western interests.  In early 2005, however, Harun was arrested by Libyan authorities and held in custody until his release in June 2011.  Harun was arrested in June 2011 by Italian authorities.  He was indicted on terrorism changes in the United States in February 2012 and extradited from Italy to the United States later that year. 

Mr. O’Callaghan and Mr. Donoghue expressed their grateful appreciation to the FBI’s Joint Terrorism Task Force, the Department of Justice’s Office of International Affairs, the Department of Defense Army investigators, the Office of Military Commissions, the Italian Ministry of Justice, the Prosecutor’s Office in Palermo, Italy, the Italian National Police, Guardia di Finanza and Carabinieri authorities for their support and assistance.

Assistant U.S. Attorneys Shreve Ariail and Matthew J. Jacobs of the Eastern District of New York, and Trial Attorney Joseph N. Kaster of the National Security Division’s Counterterrorism Section are in charge of the prosecution.

Earlier today in federal court in Central Islip, New York, Edward J. Sypher, Jr., and Matthew T. Voss, senior executives at Long Island mortgage lender Vanguard Funding, LLC (Vanguard), pleaded guilty to conspiring to commit wire and bank fraud in connection with their diversion of more than $8.9 million of warehouse loans that Vanguard had obtained to fund mortgages.  The guilty pleas were entered before United States District Judge Sandra J. Feuerstein.  When sentenced, each defendant faces up to 20 years in prison, as well as restitution, criminal forfeiture and a fine.

Richard P. Donoghue, 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, and Maria T. Vullo, Superintendent, New York State Department of Financial Services, announced the guilty pleas.

According to court filings and the facts presented at the plea proceedings, between August 2016 and March 2017, Voss, Vanguard’s Chief Operating Officer, and Sypher, the Chief Financial Officer, engaged in a scheme in which they obtained warehouse loans, or short-term loans, for Vanguard by falsely representing that Vanguard would use the proceeds of those loans to fund mortgages or mortgage refinancing for Vanguard’s clients.  Once Vanguard received the loans, however, the defendants diverted the monies to pay personal expenses and compensation, and to pay off loans they had previously obtained with fraudulent loan submissions for improper purposes. 

The government’s case is being handled by the Office’s Business and Securities Fraud Section.  Assistant United States Attorneys Whitman G.S. Knapp and Elizabeth Losey Macchiaverna are in charge of the prosecution.

The Defendants:

EDWARD J. SYPHER, JR.
Age: 41
Residence: Scarsdale, New York
E.D.N.Y. Docket No. 18-CR-028 (SJF)

MATTHEW T. VOSS
Age: 42
Residence: Northport, New York
E.D.N.Y. Docket No. 18-CR-027 (SJF)

Earlier today, in federal court in Brooklyn, defendants Milton Contreras, Oscar Welman Espinoza-Merino and Jose Osmin Rubio were each sentenced by United States District Judge Margo K. Brodie following their convictions for the murder of a 19-year-old victim on Long Island in 2014.  Contreras was sentenced to 27 years’ imprisonment, while Espinoza-Merino and Osmin Rubio were each sentenced to more than 24 years’ imprisonment.  After serving their sentences, all three defendants will face deportation from the United States.

Richard P. Donoghue, United States Attorney for the Eastern District of New York; Angel M. Melendez, Special Agent-in-Charge, United States Immigration and Customs Enforcement (ICE), Homeland Security Investigations (HSI) New York; Ashan M. Benedict, Special Agent-in-Charge, Bureau of Alcohol, Tobacco, Firearms and Explosives, New York Field Division (ATF); and James P. O’Neill, Commissioner, New York City Police Department,   announced the sentencings. Mr. Donoghue also expressed his appreciation to the Suffolk County Police Department for their assistance during the investigation.

“Today’s sentence marks the final chapter in the pursuit of justice against these three MS-13 gang members who brutally murdered a teenager execution-style when they suspected him of cooperating with law enforcement,” stated United States Attorney Donoghue.  “This prosecution is part of the ongoing mission of this Office to protect the residents of this district from the violence and lawlessness of MS-13, and we will not rest until the MS-13 criminal organization is entirely dismantled.”

“It is not a secret that MS-13 gang members are violent for the sake of being violent, and in this particular case exhibited their murderous ways by executing a teenager in Long Island,” stated HSI Special Agent-in-Charge Melendez. “As they use violence to seek power through instilling fear into the neighborhoods in which they live, we will be relentless working with our partners to dismantle this vicious gang and bring peace back to the communities.”

“The individuals that committed this heinous act of violence are rightfully where they belong. While in prison, they can reflect on the terror and pain they inflicted on their community. Gangs like MS-13 that seek to terrorize the community putting citizens at fear for their lives should know that law enforcement is committed to rooting this evil from our society and making the streets safe for everyone,” stated ATF Special Agent-in-Charge Benedict. “I would like to express my gratitude to the United States Attorney for prosecuting the case. I also would like to thank the Special Agents and Task Force Officers of the ATF’s Joint Firearms Task Force and our counterparts at HSI and the NYPD for diligently pursuing this case until justice was served.” 

As detailed in the superseding indictment, the three defendants—along with a fourth defendant convicted of the murder, Byron Lopez, who has not yet been sentenced—are members of the Jamaica, Queens and/or Brentwood, Long Island chapters of the violent street gang La Mara Salvatrucha, also known as “MS-13.”  On February 25, 2014, Lopez, Espinoza-Merino, Contreras and Rubio directed the victim, fellow gang member Sidney Valverde, to travel to Long Island under the false pretense that they needed him to assist in gang business there.  In fact, the co-conspirators planned to kill Valverde because they believed that he was providing information about the gang’s activities to law enforcement.  After Valverde arrived in Long Island, the co-conspirators shot him in the back of the head and left his body on Miller Place Beach in Suffolk County where it was discovered by a beachcomber approximately two weeks later.

This case is the latest in a series of federal prosecutions by the United States Attorney’s Office for the Eastern District of New York targeting members of the MS-13, a violent international criminal organization.  The MS-13’s leadership is based in El Salvador and Honduras, but the gang has thousands of members across the United States.  With numerous branches, or “cliques,” the MS-13 is the largest and most violent street gang on Long Island. Since 2003, hundreds of MS-13 members, including dozens of clique leaders, have been convicted on federal felony charges in this district.  A majority of those MS-13 members have been convicted on federal racketeering charges for participating in murders, attempted murders, and assaults.  Since 2010 alone, this Office has obtained indictments charging MS-13 members with carrying out more than 40 murders in the Eastern District of New York and has convicted dozens of MS-13 leaders and members in connection with those murders.

The government’s case is being handled by the Office’s Organized Crime and Gangs Section.  Assistant United States Attorney Alixandra Smith is in charge of the prosecution.

Defendants Sentenced Today: OSCAR WELMAN ESPINOZA-MERINO (aka “Speedy” and “Petey”)
Age: 35
Brentwood, New York

MILTON CONTRERAS (aka “Diabolico”)
Age: 22
Brentwood, New York

JOSE OSMIN RUBIO (aka “Slow”)
Age: 30
Brentwood, New York

Defendant Awaiting Sentencing: BYRON LOPEZ
Age: 26
Queens, New York

E.D.N.Y. Docket No. 14-463 (MKB) (RER)

A 15-count indictment was unsealed yesterday in federal court in Brooklyn charging Stella Boyadjian, Hrachya Atoyan and Diana Grigoryan, also known as “Dina Akopovna,” for their roles in a multi-year visa fraud scheme that brought Armenian citizens into the United States for profit.  The defendants are charged with multiple counts of visa fraud and with conspiring to defraud the United States, commit visa fraud and illegally bring aliens into the United States.  Boyadjian and Grigoryan are also charged with related money laundering charges, and Boyadjian is charged with aggravated identity theft.  Boyadjian was arraigned yesterday before United States Magistrate Judge James Orenstein.  Atoyan’s initial appearance for removal proceedings to the Eastern District of New York is scheduled for later today, in the Central District of California.

Richard P. Donoghue, United States Attorney for the Eastern District of New York, John P. Cronan, Acting Assistant Attorney General of the United States Justice Department’s Criminal Division, and Christian J. Schurman, Principal Deputy Assistant Secretary for Diplomatic Security and Director for Diplomatic Security Service, United States Department of State, announced the charges.  

“As alleged in the indictment, the defendants choreographed their fraud scheme by dressing visa applicants in traditional dance costumes and creating fake concert flyers in order to deceive a government program that allows foreign nationals to temporarily enter the United States as artistic performers,” stated United States Attorney Donoghue.  “As a result of outstanding investigative work and commitment to protecting the integrity of the immigration process by this Office and our law enforcement partners, the defendants will now face the music for their alleged crimes.”

“Fraudsters who undermine our immigration system threaten our public safety and our national security,” said Acting Assistant Attorney General Cronan. “The Justice Department will not tolerate abuses of our nation’s immigration laws like those alleged in the indictment unsealed today.  We will root out immigration fraud and bring those responsible to justice.”

 “The Diplomatic Security Service is firmly committed to protecting the integrity of all U.S. visas and travel documents – especially those, like the P-3 visa, which allow for entertainers to visit the U.S. to perform in culturally unique events and deepen our understanding of different cultures,” stated Principal Deputy Assistant Secretary Schurman. “This case is the result of a strong partnership among federal law enforcement agencies and DSS’ global network of special agents working together to stop visa and passport crimes and stop criminals from earning illegal income by exploiting U.S. visas, passports, and foreign workers.”

As alleged in the indictment, the defendants were engaged in a widespread visa fraud scheme to illegally bring foreign nationals (“Aliens”) into the United States by fraudulently claiming to the United States Citizenship and Immigration Services (“USCIS”) that they were members of traditional Armenian performance groups and thus qualified for P-3 visas as “culturally unique” artists or entertainers.

The P-3 nonimmigrant visa classification allows foreign nationals to temporarily travel to the United States to perform, teach or coach as artists or entertainers, under a program that is culturally unique.  A United States employer or sponsoring organization is required to submit a USCIS Form I-129 Petition for a Non-Immigrant Worker, along with supporting documentation, attesting that the performances in the United States are culturally unique.

As alleged in the indictment, Boyadjian ran a non-profit organization called Big Apple Music Awards Foundation Inc. (“BAMA”), based in Rego Park, New York, which she and her co-conspirators used to further their visa fraud scheme.  As part of the scheme, the defendants and their co-conspirators solicited Aliens and charged them fees ranging from $3,000 to $15,000 per Alien applicant to fraudulently obtain P-3 visas by submitting false Forms I-129 and supporting documents to the USCIS.  Upon approval of the Form I-129 petitions, the defendants and their co-conspirators acquired fraudulent dance certificates and organized staged photo sessions where foreign nationals wore Armenian dance costumes to make it appear as though they were traditional Armenian musicians, singers and performers.  After being trained how to falsely answer questions during visa interviews, the P-3 visa applicants presented these fake certificates and photos during their P-3 visa interviews.  Once in the United States, some beneficiaries of the P-3 visas paid the defendants an additional fee to be included in applications for extensions of their fraudulently obtained visas.  The defendants furthered their visa fraud scheme by creating flyers and other documents purporting to hold BAMA-sponsored concerts and events in the United States.

The charges announced today are merely allegations and the defendants are presumed innocent unless and until proven guilty.

This case is a joint investigation by the Diplomatic Security Service’s Criminal Investigations Division and Overseas Criminal Investigations Divisions, with assistance from the U.S. Citizenship and Immigration Services Fraud Detection and National Security Directorate.

The government’s case is being prosecuted by Assistant United States Attorney David Gopstein and Trial Attorney Sasha N. Rutizer of the Criminal Division’s Human Rights and Special Prosecutions Section.

The Defendants:

STELLA BOYADJIAN
Age: 47
Rego Park, New York

HRACHYA ATOYAN
Age: 30
Glendale, California

DIANA GRIGORYAN (also known as “Dina Akopovna”)
Age: 41
Yerevan, Armenia

E.D.N.Y. Docket No. 18-CR-57 (MKB)

Three individuals were indicted in the Eastern District of New York for their alleged roles in a multi-year visa fraud scheme that brought Armenian citizens into the United States for profit.

Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division; U.S. Attorney Richard P. Donoghue of the Eastern District of New York and Principal Deputy Assistant Secretary Christian J. Schurman for U.S. Department of State Diplomatic Security and Director for Diplomatic Security Service (DSS), made the announcement.

Stella Boyadjian, 47, of Rego Park, New York; Hrachya Atoyan, 30, of Glendale, California; and Diana Grigoryan aka “Dina Akopovna,” 41, of the Republic of Armenia, were charged in a 15-count indictment unsealed yesterday in federal court in Brooklyn with multiple counts of visa fraud and with conspiracy to defraud the United States, commit visa fraud, and illegally bring aliens into the United States.  Boyadjian and Grigoryan are also charged with related money laundering charges, and Boyadjian is charged with aggravated identity theft. Boyadjian was arraigned yesterday before U.S. Magistrate Judge James Orenstein.  Atoyan’s initial appearance for removal proceedings to the Eastern District of New York is scheduled for later today, in the Central District of California.

“Fraudsters who undermine our immigration system threaten our public safety and our national security,” said Acting Assistant Attorney General John P. Cronan. “The Justice Department will not tolerate abuses of our nation’s immigration laws like those alleged in the indictment unsealed today.  We will root out immigration fraud and bring those responsible to justice.”

“As alleged in the indictment, the defendants choreographed their fraud scheme by dressing visa applicants in traditional dance costumes and creating fake concert flyers in order to deceive a government program that allows foreign nationals to temporarily enter the United States as artistic performers,” said U.S. Attorney Donoghue. “As a result of outstanding investigative work and commitment to protecting the integrity of the immigration process by this Office and our law enforcement partners, the defendants will now face the music for their alleged crimes.”

“The Diplomatic Security Service is firmly committed to protecting the integrity of all U.S. visas and travel documents -- especially those, like the P-3 visa, which allow for entertainers to visit the United States to perform in culturally unique events and deepen our understanding of different cultures,” said Principal Deputy Assistant Secretary Schurman. “This case is the result of a strong partnership among federal law enforcement agencies and DSS’ global network of special agents working together to stop visa and passport crimes and stop criminals from earning illegal income by exploiting U.S. visas, passports, and foreign workers.”

According to the indictment, unsealed today upon the arrest of Boyadjian and Atoyan, Boyadjian led a transnational network of co-conspirators who engaged in a widespread visa fraud scheme to bring Armenian citizens into the United States by fraudulently claiming to the U.S. Citizenship and Immigration Services (USCIS) that the Armenians were members of folk performance groups, and thus qualified for P-3 “Culturally Unique Artist” visas. The P-3 nonimmigrant visa classification allows foreign nationals to temporarily travel to the United States to perform, teach or coach as artists or entertainers, under a program that is culturally unique. A U.S. employer or sponsoring organization is required to submit a USCIS Form I-129 Petition for a Non-Immigrant Worker, along with supporting documentation, attesting that the performances in the United States are culturally unique.

As alleged in the indictment, Boyadjian ran a non-profit organization called Big Apple Music Awards Foundation, based in Rego Park, New York. Boyadjian used the Big Apple Music Awards Foundation as well as formal and informal Armenian music industry contacts in the United States and Armenia to perpetuate the scheme. Boyadjian and others solicited Armenian citizens who wanted to come to the United States and charged them between $3,000 and $15,000 to be included on the Form I-129 Petitions. Boyadjian and other associates in Armenia acquired fraudulent performer certificates and organized staged photo sessions where the aliens wore traditional Armenian folk outfits to make it appear as though they were traditional Armenian performers. After being trained how to defeat U.S. visa interviews, the individual aliens presented these certificates and photos to U.S. consular officers during their visa interviews.  Once the Armenians entered the United States, some would pay Boyadjian and her associates additional money to be included in another fraudulent petition asking for P-3 visa extensions.  Some aliens have overstayed their visas and remain unlawfully in the United States.

This case was a joint investigation by the DSS’s Criminal Fraud Investigations and Overseas Criminal Investigations Divisions with assistance from the USCIS Fraud Detection and National Security, Center Fraud Detection Operations in Vermont.  Trial Attorney Sasha N. Rutizer of the Criminal Division’s Human Rights and Special Prosecutions Section and Assistant U.S. Attorney David Gopstein of the Eastern District of New York are prosecuting the case.

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

A six-count indictment was unsealed today in federal court in Brooklyn charging seven defendants with conspiring to bribe correction officers employed by the New York City Department of Corrections (“DOC”) as part of a narcotics smuggling conspiracy.  The defendants’ arraignment is scheduled for this afternoon before United States Magistrate Judge James Orenstein.    

As alleged in the indictment, the defendants conspired to smuggle marijuana and other contraband into DOC prison facilities with the assistance of New York City Department of Correction Officers Christian Mizell and Carl Noel.  Defendants Warren Green and Patrick Johnson, both incarcerated on unrelated felony offenses, arranged for marijuana and other contraband to be packaged and delivered covertly to the correction officers by defendants Robert Martino, Malik Holloway and Asha Patterson.  The Correction Officers received thousands of dollars in bribes to smuggle the contraband past DOC security for eventual distribution inside the prison. 

Richard P. Donoghue, United States Attorney for the Eastern District of New York, James J. Hunt, Special Agent-in-Charge, Drug Enforcement Administration, New York Division (DEA), Mark G. Peters, Commissioner, New York City Department of Investigation (DOI), James P. O’Neill, Commissioner, New York City Police Department (NYPD), and George P. Beach, Superintendent, New York State Police, announced the charges. 

“The honesty and integrity of correction officers is critical to the orderly running of a prison,” stated United States Attorney Donoghue.  “When the defendant correction officers betrayed the trust placed in them by the City of New York, they not only committed serious crimes but also potentially jeopardized the safety of staff and inmates.  This Office and our law enforcement partners are committed to identifying and prosecuting corrupt correction officers who accept bribes to smuggle contraband into prison facilities.”   

“Drug traffickers are notorious for their smuggling methods, but this case demonstrated the defendants’ ability to bypass security altogether,” stated DEA Special Agent-in-Charge Hunt.  “With two correction officers as members of the organization, the defendants allegedly pushed contraband into prison for resale to inmates.  Today’s arrests are a result of law enforcement partnerships and hard work.”

“This investigation demonstrates again a pattern of misconduct in our City’s jails: outside civilians working with Correction Officers and DOC employees to smuggle narcotics and other contraband to inmates on the inside,” stated DOI Commissioner Peters.  “DOI and its partners, including the U.S. Attorney for the Eastern District, have been cracking down on these illegal operations to stem the flow of contraband, while also working towards critical reforms in DOC’s front-gate screening protocols to shore up security at these facilities.” 

“Due to the hard work and cooperation between law enforcement partners at all levels, this smuggling conspiracy was uncovered and shut down,” stated NYSP Superintendent Beach.  “This sends a strong message that we will not tolerate such crimes, especially when they are perpetuated by individuals in a place of authority who have been entrusted with upholding the law. Such criminals will be prosecuted to the fullest.”

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

The government’s case is being prosecuted by Assistant United States Attorney Erik Paulsen of the Office’s Public Integrity Section and Nomi Berenson of the Office’s International Narcotics and Money Laundering Section.

The Defendants:

Christian MIzell
Age: 48
Queens, New York

CARL NOEL
Age: 32
New York, New York

WARREN GREEN
Age: 40
Pine City, New York

PATRICK JOHNSON
Age: 27
Bronx, New York

ROBERT MARTINO
Age: 37
Queens, New York

MALIK HOLLOWAY
Age: 22
Bronx, New York

ASHA PATTERSON
Age: 43
Queens, New York

E.D.N.Y. Docket No. 18-CR-60 (PKC)

Earlier today, in federal court in Brooklyn, Dr. Syed Imran Ahmed, a licensed medical doctor who practiced at hospitals in Brooklyn and on Long Island, was sentenced by United States Chief Judge Dora L. Irizarry of the Eastern District of New York to 13 years’ imprisonment for submitting millions of dollars in false and fraudulent claims to Medicare.  The Court also ordered Dr. Ahmed to pay $7,266,008.95 in restitution, to forfeit $7,266,008.95, and to pay a $20,000 fine.  Dr. Ahmed was convicted by a federal jury after an 11-day trial of one count of health care fraud, three counts of making false statements related to health care matters, and two counts of money laundering.

Richard P. Donoghue, United States Attorney for the Eastern District of New York, John P. Cronan, Acting Assistant Attorney General of the Justice Department’s Criminal Division, William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Scott J. Lampert, Special Agent-in-Charge, U.S. Department of Health and Human Services, Office of Inspector General (HHS OIG) Office of Investigations, New York Region, announced the sentence.

“Dr. Syed Ahmed treated Medicare like a personal piggy bank, stealing over $7.2 million by making fraudulent claims for medical procedures he never performed,” stated United States Attorney Donoghue.  “Dr. Ahmed will now pay the price for violating the trust that Medicare places in doctors.  His 13-year prison sentence and the heavy payments imposed should send a powerful message of deterrence to other medical professionals who would seek to defraud vital taxpayer-funded programs like Medicare for personal enrichment.  This Office, together with our law enforcement partners, will remain vigilant in rooting out health care fraud.”

“Medicare is a crucial program for many of the most vulnerable people in our society – American seniors and those with disabilities,” stated Acting Assistant Attorney General Cronan.  “In this case, Syed Ahmed put his own greed ahead of the trust we put in our medical professionals, draining over $7 million in precious funding from our Medicare program.  His conviction and the sentence imposed in this case demonstrate the Department of Justice’s unwavering commitment to protecting public funds and the integrity of our health care system.”

“Health care fraud is often billed as a victimless crime, but that couldn’t be further from the truth,” stated FBI Assistant Director-in-Charge Sweeney.  “Someone is always left to foot the bill. Insurers, the insured, and others are the ones who pay the price. Those who employ these schemes will most certainly be brought to justice, as we’ve proven here today.”

“The fraud scheme that Dr. Ahmed engaged in was motivated by pure greed,” stated HHS OIG Special Agent-in-Charge Lampert.  “HHS OIG and our law enforcement partners will continue to aggressively pursue all those who seek to unlawfully enrich themselves by victimizing participants of the Medicare program.” 

According to evidence presented at trial, Dr. Ahmed, a surgeon who practiced at Kingsbrook Jewish Medical Center and Wyckoff Heights Medical Center in Brooklyn, Franklin Hospital in Valley Stream, and Mercy Medical Center in Rockville Centre, New York, billed the Medicare program for incision-and-drainage and wound debridement procedures that he did not perform.  Dr. Ahmed wrote out lists of phony surgeries and sent the lists to his billing company in Michigan, with instructions that the procedures be billed to Medicare.  Dr. Ahmed also directed that the surgeries be billed as though they had taken place in an operating room in order to increase the payout for the fraudulent scheme.  The evidence introduced at trial showed that Medicare paid over $7 million to Dr. Ahmed for his fraudulent claims.

The FBI and HHS OIG investigated the case, which was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of New York.  Assistant U.S. Attorney F. Turner Buford, formerly a Fraud Section trial attorney, Senior Litigation Counsel Patricia Notopoulos of the United States Attorney’s Office for the Eastern District of New York, and Trial Attorney Debra Jaroslawicz of the Fraud Section are prosecuting the case. Assistant U.S. Attorney Karin Orenstein of the Office’s Civil Division is responsible for the forfeiture of assets.

The Defendant:

Syed Imran Ahmed
Age: 51
Residence: Glen Head, New York

E.D.N.Y. Docket No. 14-CR-277 (DLI)

A New York surgeon who practiced at hospitals in Brooklyn and Long Island was sentenced today to 156  months in prison for his role in a scheme that involved the submission of millions of dollars in false and fraudulent claims to Medicare.

Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division, U.S. Attorney Richard P. Donoghue of the Eastern District of New York, Assistant Director in Charge William F. Sweeney Jr. of the FBI’s New York Field Office and Special Agent in Charge Scott Lampert of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Office of Investigations made the announcement.

Syed Imran Ahmed M.D., 51, of Glen Head, New York, was sentenced by U.S. District Judge Dora L. Irizarry of the Eastern District of New York, who also ordered Ahmed to pay $7,266,008.95 in restitution, to forfeit $7,266,008.95, and to pay a $20,000 fine.  Ahmed was convicted in July 2016 after an 11-day trial of one count of health care fraud, three counts of making false statements related to health care matters and two counts of money laundering.

“Medicare is a crucial program for many of the most vulnerable people in our society – American seniors and those with disabilities,” said Acting Assistant Attorney General Cronan.  “In this case, Syed Ahmed put his own greed ahead of the trust we put in our medical professionals, draining over $7 million in precious funding from our Medicare program.  His conviction and the sentence imposed in this case demonstrate the Department of Justice’s unwavering commitment to protecting public funds and the integrity of our health care system.”

“Dr. Syed Ahmed treated Medicare like a personal piggy bank, stealing over $7.2 million by making fraudulent claims for medical procedures he never performed,” stated U.S. Attorney Donoghue.  “Dr. Ahmed will now pay the price for violating the trust that Medicare places in doctors.  His 13-year prison sentence and the heavy payments imposed should send a powerful message of deterrence to other medical professionals who would seek to defraud vital taxpayer-funded programs like Medicare for personal enrichment.  This Office, together with our law enforcement partners, will remain vigilant in rooting out health care fraud.”

“Health care fraud is often billed as a victimless crime, but that couldn’t be further from the truth,” said Assistant Director in Charge Sweeney.  “Someone is always left to foot the bill. Insurers, the insured, and others are the ones who pay the price. Those who employ these schemes will most certainly be brought to justice, as we’ve proven here today.”

“The fraud scheme that Dr. Ahmed engaged in was motivated by pure greed,” said Special Agent in Charge Lampert.  “HHS OIG and our law enforcement partners will continue to aggressively pursue all those who seek to unlawfully enrich themselves by victimizing participants of the Medicare program.” 

According to evidence presented at trial, Ahmed, a surgeon who practiced at Kingsbrook Jewish Medical Center and Wyckoff Heights Medical Center in Brooklyn, Franklin Hospital in Valley Stream, and Mercy Medical Center in Rockville Centre, New York, billed the Medicare program for incision-and-drainage and wound debridement procedures that he did not perform.  Ahmed wrote out lists of phony surgeries and sent the lists to his billing company in Michigan with instructions that they be billed to Medicare.  Ahmed also directed that the surgeries be billed as though they had taken place in an operating room so as to increase the payout for the fraudulent scheme, the evidence showed.           

The evidence introduced at trial showed that Medicare paid over $7 million to Ahmed for fraudulent claims.

The FBI and HHS-OIG investigated the case, which was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of New York.  Trial Attorney Debra Jaroslawicz of the Fraud Section, Assistant U.S. Attorney F. Turner Buford, formerly a Fraud Section trial attorney, and Senior Litigation Counsel Patricia Notopoulos of the Eastern District of New York are prosecuting the case. 

The Fraud Section leads the Medicare Fraud Strike Force.  Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 3,500 defendants who have collectively billed the Medicare program for more than $12.5 billion.  In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

Earlier today, in federal court in Brooklyn, an indictment was unsealed charging Michael Crumble and Ramell Markus with kidnapping, extortion and possessing and brandishing a firearm in relation to those crimes.  The defendants were arrested today and are scheduled to be arraigned this afternoon before United States Magistrate Judge James Orenstein.

Richard P. Donoghue, 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 James P. O’Neill, Commissioner, New York City Police Department (NYPD), announced the charges. 

“As alleged in the indictment, the defendants kidnapped and viciously assaulted an individual for eight hours, forcing him to turn over narcotics and cash,” stated United States Attorney Donoghue.  “This Office and our law enforcement partners, are committed to ridding our community of individuals, like these defendants, who are responsible for drug-related violence.”  Mr. Donoghue gave particular thanks to the New York Metropolitan Safe Streets Task Force, which is comprised of agents from the FBI and detectives from the NYPD.

“Not only did the subjects in this investigation allegedly rob their victim, but kidnapped and tortured him to extract information.  No human deserves to be beat, burned and pistol-whipped into submission,” stated FBI Assistant Director-in-Charge Sweeney. “The FBI Metro Safe Streets Task Force works each day with our law enforcement partners to uncover, and investigate cases to get these violent criminals off the streets and out of our communities.” 

As alleged in the indictment and detailed in court filings, the defendants Michael Crumble and Ramell Markus, along with a third co-conspirator (“CC-1”), abducted, assaulted, and extorted a victim (“John Doe”) in the early morning hours of December 18, 2017.  At that time, Doe left his home to meet Markus in Markus’s car.  As Doe got into the backseat, Crumble and CC-1 came out of the shadows and pushed Doe further into the car, where CC-1 pressed a gun against Doe’s head.  Markus, sitting in the front seat, told CC-1 to check Doe for any weapons and, if Doe had one, to shoot him in the face.  Markus then took the gun from CC-1 and pistol-whipped Doe across the head.  While in the vehicle, Markus demanded, in sum and substance, that Doe give Markus narcotics that the defendants believed Doe had at his home.

Subsequently, Markus, Crumble and CC-1 drove Doe to a residence in Brooklyn and forced him inside.  The defendants again demanded that Doe give them money and narcotics, and also disclose an address where the perpetrators believed additional narcotics and money were located.  To force Doe to comply, Markus broke a glass on Doe’s face, and CC-1 repeatedly burned both of Doe’s arms with a hot iron.  Doe eventually called his fiancée and told her to gather his cash and narcotics, which Markus and Crumble retrieved from outside Doe’s home and then brought back to the residence with Doe and CC-1.

Not satisfied with the drugs and cash, the defendants and CC-1 continued to keep Doe captive, and drove him to a hotel.  The perpetrators forced Doe to stay at the hotel while they waited for another individual to call Doe, who would supposedly provide the address that the defendants sought.  After waiting a number of hours, the defendants forced Doe back inside the car and took him back to his home.  Because Doe refused to provide the perpetrators with the address, they forced Doe to provide a pound of marijuana as collateral.  In total, the defendants kidnapped Doe for approximately eight hours.

The charges in the indictment are merely allegations, and the defendants are presumed innocent unless and until proven guilty.  If convicted of all counts, the defendants face a mandatory minimum of seven years’ imprisonment and a maximum of life imprisonment.    

The government’s case is being handled by the Office’s Organized Crime and Gangs Section.  Assistant United States Attorneys Keith D. Edelman and Lindsay K. Gerdes are in charge of the prosecution.

The Defendants:

MICHAEL CRUMBLE
Age: 34 
Brooklyn, New York

RAMELL MARKUS (also known as “Rah,” “Dollah” and “Smooth”)
Age: 35 
Brooklyn, New York

E.D.N.Y. Docket No. 18-CR-32 (ARR)

Earlier today, at the federal courthouse in Brooklyn, Munther Omar Saleh was sentenced by United States District Judge Margo K. Brodie to 18 years’ imprisonment, to be followed by a term of 10 years’ supervised release.  Saleh had pleaded guilty on February 10, 2017 to all counts in an indictment charging him with conspiring and attempting to provide material support to the Islamic State of Iraq and al-Sham (ISIS), and with assaulting and conspiring to assault federal officers.   

Richard P. Donoghue, United States Attorney for the Eastern District of New York, Edward C. O’Callaghan, Acting Assistant Attorney General for National Security, William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and James P. O’Neill, Commissioner, New York City Police Department (NYPD), announced the sentence.

“Munther Omar Saleh and his coconspirators conducted attacks on members of law enforcement who worked tirelessly to keep our city safe,” stated United States Attorney Donoghue.  “Saleh’s sentence will not only incapacitate the defendant for a significant period of time, but should also serve as a deterrent to those who contemplate waging violent jihad in New York City at the direction of a foreign terrorist organization.  This Office, and our partners on the Joint Terrorism Task Force, will never relent in our efforts to hold terrorists accountable for their cowardly acts, including attacks on those who protect us.” 

“Inspired by ISIS’s violent and hateful ideology, the defendant conspired with others to use a pressure-cooker bomb in a terrorist attack in New York and attempted to attack members of law enforcement who were conducting surveillance of him,” said Acting Assistant Attorney General O’Callaghan.  “Today’s sentence is but one example of our resolve to bring to justice homegrown violent extremists who plot and attempt attacks on innocent people, including law enforcement agents, in the U.S. in the name of foreign terrorist organizations.”

“Saleh attempted to turn our city into a staging ground for violent attacks, including those aimed at both local and federal law enforcement officials. Directed by a known terrorist organization responsible for civilian massacres and other heinous crimes worldwide, he supported and attempted to facilitate the martyrdom of those with similar views,” stated FBI Assistant Director-in-Charge Sweeney. “Today’s sentencing promises he’ll remain behind bars for a significant period of time, upholding our faith in a justice system that has little compassion for those who wish to harm our way of life.”

As alleged in the indictment and in other court filings, Saleh, together with other coconspirators, assisted New Jersey resident Nader Saadeh’s planned travel to ISIS-controlled territory.  Saleh personally accompanied Saadeh to John F. Kennedy International Airport where Saadeh departed on a flight for Jordan in the first leg of a planned trip to ISIS-controlled territory.  Saadeh was subsequently apprehended and pleaded guilty in federal court in New Jersey to conspiring to provide material support to ISIS. 

Working with ISIS attack facilitators located overseas, Saleh coordinated a plot to conduct a terrorist attack in New York City.  Saleh sought and received instructions from ISIS attack facilitator Junaid Hussain to construct a pressure-cooker bomb and discussed with him potential targets for a terrorist attack in New York City, such as the Statue of Liberty.  As detailed in court documents, Saleh informed ISIS attack facilitators that his coconspirators—five individuals located in New York and New Jersey—had confronted law enforcement officers who were surveilling them continuously.  Saleh also sought and received authorization from Junaid Hussain permitting codefendant Fareed Mumuni to conduct a suicide “martyrdom” attack by using a pressure-cooker bomb against law enforcement officers who were following the coconspirators and thus preventing them from traveling to join ISIS.

On June 13, 2015, Saleh and another coconspirator were arrested in Queens after they attempted to attack members of law enforcement by charging at a federal officer who was performing physical surveillance of Saleh.  Saleh and the coconspirator were armed with knives.  The law enforcement officer reversed his vehicle into a multilane intersection and escaped the attack without incident or injury.  On June 17, 2015, during the execution of a search warrant at his residence in Staten Island, Mumuni was arrested after he repeatedly stabbed an FBI agent in the torso with a large kitchen knife.  Fortunately, the knife did not penetrate the agent’s protective body armor, and he sustained only minor injuries.  In his post-arrest interview, Mumuni admitted that Saleh had informed him that an ISIS member had sanctioned Mumuni’s planned suicide attack on law enforcement and that Saleh and Mumuni had discussed using a pressure-cooker bomb to carry out the attack.

Mr. O’Callaghan and Mr. Donoghue also praised the agents, analysts and prosecutors for their dedication and commitment to this investigation and prosecution.

The government’s case is being handled by the Office’s National Security and Cybercrime Section.  Assistant United States Attorneys Alexander A. Solomon, Douglas M. Pravda, and Ian C. Richardson are in charge of the prosecution, with assistance provided by Trial Attorney Robert Sander and Justin Sher of the National Security Division’s Counterterrorism Section.

The Defendant:

MUNTHER OMAR SALEH
Age: 22
Queens, New York

E.D.N.Y. Docket No. 15-CR-393 (MKB)

Munther Omar Saleh, 22, of Queens, New York, was sentenced today to 18 years in prison, to be followed by a term of 10 years’ supervised release, for conspiring and attempting to provide material support to the Islamic State of Iraq and al-Sham (ISIS), a designated foreign terrorist organization, and for assaulting and conspiring to assault federal officers.  Saleh pleaded guilty on Feb. 10, 2017, to all counts in the indictment.

Acting Assistant Attorney General for National Security Edward C. O’Callaghan, U.S. Attorney Richard P. Donoghue for the Eastern District of New York, Assistant Director in Charge William F. Sweeney, Jr. of the FBI’s New York Field Office and Commissioner James P. O’Neill of the NYPD made the announcement.  The sentence was issued by U.S. District Judge Margo K. Brodie.

“Inspired by ISIS’s violent and hateful ideology, the defendant conspired with others to use a pressure-cooker bomb in a terrorist attack in New York and attempted to attack members of law enforcement who were conducting surveillance of him,” said Acting Assistant Attorney General O’Callaghan.  “Today’s sentence is but one example of our resolve to bring to justice homegrown violent extremists who plot and attempt attacks on innocent people, including law enforcement agents, in the U.S. in the name of foreign terrorist organizations.”

“Munther Omar Saleh and his coconspirators conducted attacks on members of law enforcement who worked tirelessly to keep our city safe,” stated U.S. Attorney Donoghue.  “Saleh’s sentence will not only incapacitate the defendant for a significant period of time, but should also serve as a deterrent to those who contemplate waging violent jihad in New York City at the direction of a foreign terrorist organization.  This Office, and our partners on the Joint Terrorism Task Force, will never relent in our efforts to hold terrorists accountable for their cowardly acts, including attacks on those who protect us.” 

“Saleh attempted to turn our city into a staging ground for violent attacks, including those aimed at both local and federal law enforcement officials. Directed by a known terrorist organization responsible for civilian massacres and other heinous crimes worldwide, he supported and attempted to facilitate the martyrdom of those with similar views,” said Assistant Director in Charge Sweeney. “Today’s sentencing promises he’ll remain behind bars for a significant period of time, upholding our faith in a justice system that has little compassion for those who wish to harm our way of life.”

As alleged in the indictment and in other court filings, Saleh and codefendant Fareed Mumuni conspired to support ISIS by helping their coconspirators attempt to travel to ISIS-controlled territory in order to join ISIS, and by plotting to use a pressure-cooker bomb to conduct a terrorist attack in the New York metropolitan area on behalf of ISIS. 

On June 13, 2015, Saleh and another coconspirator were arrested in Queens after they attempted to attack members of law enforcement by charging at a federal officer who was performing physical surveillance of Saleh.  Saleh and the coconspirator were armed with knives.  Following his arrest, Saleh admitted to agents that he had discussed with Mumuni physically attacking the law-enforcement officers who were surveilling Mumuni.  On June 17, 2015, during the execution of a search warrant at his residence in Staten Island, Mumuni was arrested after he repeatedly stabbed an FBI agent in the torso with a large kitchen knife.  The knife did not penetrate the agent’s protective body armor, and he sustained minor injuries. 

Mr. O’Callaghan and Mr. Donoghue praised the agents, analysts and prosecutors for their dedication and commitment to this investigation and prosecution.

The government’s case is being prosecuted by Assistant U.S. Attorneys Alexander A. Solomon, Douglas M. Pravda, and Ian C. Richardson, with assistance provided by Trial Attorneys Justin Sher and Bob Sander of the National Security Division’s Counterterrorism Section.

A federal grand jury sitting in the Eastern District of New York returned an indictment charging Inna Chebanenko, Andrii Gerasymenko, and Georgy Zakalyugin with conspiracy to commit wire fraud.  The defendants were arrested in Illinois last week and are scheduled to be arraigned this afternoon before United States Magistrate Judge James Orenstein in federal court in Brooklyn.   

Richard P. Donoghue, 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 James P. O’Neill, Commissioner, New York City Police Department (NYPD), announced the charge.

“As alleged in the indictment, the defendants profited through obtaining fraudulent titles to used cars in order to peddle salvaged or rebuilt vehicles to unsuspecting buyers,” stated United States Attorney Donoghue.  “This Office, working with our law enforcement partners, is committed to protecting consumers and ensuring that they get what they are paying for.”  Mr. Donoghue also expressed his grateful appreciation to the United States Postal Inspection Service, the New York State Department of Motor Vehicles, the Indiana Bureau of Motor Vehicles and the Delaware Division of Motor Vehicles for their assistance in the investigation.

“Most of us would not be able to pop the hood of a car and see for ourselves that there was damage or something seriously wrong with the vehicle.  There are laws protecting consumers for a reason because fraudsters will use whatever means they can to make money illegally,” stated FBI Assistant Director-in-Charge Sweeney.  “The FBI will continue to work with our law enforcement partners and other governmental agencies to do all we can to stop criminals from taking advantage of unsuspecting people.”

According to the court documents, between 2013 and 2016, the defendants conspired to defraud car buyers in Brooklyn and elsewhere by concealing the fact that the cars were “salvage” or “rebuilt” vehicles.  Vehicles are given a “salvage” title when they have been destroyed or received substantial damage.  Cars with “salvage” titles are worth a fraction of the value of a comparable car without a “salvage” title.  By forging the signatures of non-existent Indiana law enforcement officers on the necessary certifications, the conspirators obtained car titles from the State of Indiana stating that the salvage cars had been “rebuilt,” indicating the cars had been repaired and restored to operational condition.  However, the “rebuilt” status of the cars was concealed on the titles by, among other means, placing an automobile auction sticker on the title before selling the cars to unsuspecting buyers in Brooklyn and elsewhere at inflated prices. The buyers would then find themselves in possession of a vehicle with a value that was a fraction of the value-as-represented at the time of the sale.

The charges announced today are merely allegations and the defendants are presumed innocent unless and until proven guilty.

The government’s case is being prosecuted by Assistant United States Attorney G. Karthik Srinivasan.

The Defendants:

INNA CHEBANENKO
Age:  31
Elmhurst, Indiana

ANDRII GERASYMENKO
Age: 32
River Grove, Illinois

GEORGY ZAKALYUGIN
Age: 32
Chicago, Illinois

E.D.N.Y. Docket Nos. 18-CR- 51

Earlier today, at the federal courthouse in Brooklyn, Tara Lenich, a former supervisory Assistant District Attorney with the Kings County District Attorney’s Office (KCDA), was sentenced by United States District Judge William F. Kuntz II to a year and one day in prison on each of the two counts, to be served concurrently, after having pled guilty on April 3, 2017 to two counts of illegally intercepting oral and electronic communications occurring over two cellular telephones. 

Richard P. Donoghue, 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.

According to court filings and facts presented at the sentencing hearing, for nearly 18 months between approximately June 2015 and November 2016, Lenich illegally listened to phone conversations and viewed text messages sent to and from two cellular telephones.  As part of her illegal conduct, she created fraudulent judicial orders and forged the signatures of multiple New York State judges onto judicial orders that purportedly authorized the KCDA to intercept communications occurring over the two cellular telephones.  Lenich then misappropriated KCDA equipment to intercept, monitor, and record the communications to and from the two cellular telephones.  In furtherance of her scheme, Lenich also created fraudulent search warrants, which she then used to obtain unlawfully intercepted text messages sent to and from the two cellular telephones.  To conceal her scheme, Lenich lied to her colleagues at the KCDA, telling them that she was conducting a highly sensitive, confidential criminal investigation. 

“Former Assistant District Attorney Lenich violated her duty to the public as a prosecutor when she engaged in her long-running illegal scheme,” stated United States Attorney Donoghue.  “The victims of her scheme include the individuals whose privacy rights she violated by listening to and reading their private communications, the state court judges whose signatures she forged in order to perpetrate her scheme, the Kings County District Attorney’s Office whose reputation of integrity she damaged, and the public whose trust she betrayed.  Today’s sentencing serves as a reminder that no one is above the law.”  Mr. Donoghue expressed his appreciation to the KCDA for its cooperation.

“Without the appropriate legal authority to intercept and access communications, Lenich unlawfully listened in on personal conversations between her victims, evading the due process of law all public officials are expected to uphold,” stated FBI Assistant Director-in-Charge Sweeney.  “It’s our hope today’s sentencing will send a strong message to anyone who thinks they can get away with this egregious abuse of power.”  

The government’s case is being handled by the Office’s Public Integrity Section.  Assistant United States Attorneys Maria Cruz Melendez and Robert Polemeni are in charge of the prosecution.

The Defendant:

TARA LENICH
Age: 42
New York, NY

E.D.N.Y. Docket No. 17-CR-154 (WFK)

Earlier today, in federal court in Brooklyn, Luis Bello was sentenced by United States District Judge Nicholas G. Garaufis to 20 years’ imprisonment to be followed by five years of supervised release after his conviction for conspiring to distribute more than five kilograms of cocaine, conspiring to launder money and trafficking in firearms.  The defendant ran a cocaine distribution operation in the Bronx from 2011 until his arrest in September 2013.

Richard P. Donoghue, United States Attorney for the Eastern District of New York, and Angel M. Melendez, Special Agent-in-Charge, United States Immigration and Customs Enforcement (ICE), Homeland Security Investigations (HSI) New York, announced the sentence.

“Luis Bello oversaw a drug trafficking organization in the Bronx that brought large quantities of cocaine from Puerto Rico to the streets of New York City,” stated United States Attorney Donoghue.  “Today he was held accountable, and his drug organization has been dismantled.  We will continue to work with our law enforcement partners to stem the flow of drugs into our neighborhoods and prosecute traffickers like the defendant.”  Mr. Donoghue also expressed his appreciation to the U.S. Drug Enforcement Administration, New York Field Office; Organized Crime Drug Enforcement Task Force, New York/New Jersey;  U.S. Postal Service, Office of Inspector General; U.S. Marshals Service, Investigative Operations Division; Port Authority of New York & New Jersey Police Department; New York City Police Department and the Queens County District Attorney’s Office for their assistance during the investigation.

“Today’s 20 year sentencing of Bello effectively rids our community of the convicted leader of a dangerous drug trafficking and money laundering organization with ties to the Caribbean, that flooded the streets of New York with large quantities of cocaine,”

stated HSI Special Agent-in-Charge Melendez. “Bello will now have a lot of time to sit in his cell and think of how his actions have negatively affected the lives of so many individuals.”

According to court filings, the defendant was the head of a Bronx-based drug trafficking organization that brought more than 1,000 kilograms of cocaine from Puerto Rico to New York through drug couriers and through the United States Postal Service, distributed the drugs throughout the New York area, and laundered the proceeds from the sale of those drugs. 

Members of Bello’s organization obtained drugs from the Dominican Republic to distribute in the New York area.  Co-conspirators based in Puerto Rico shipped the drugs to Bello in New York through the U.S. mails, using the assistance of a mail carrier stationed at the Highbridge Postal Station in the Bronx, as well as through Post Office boxes rented by other members of the drug trafficking organization in New York and New Jersey.  The postal carrier’s mail route included areas where Bello’s organization was based.  The mail carrier regularly intercepted drug-laden packages that were addressed to other addresses on his route, but which he segregated based on tracking numbers and addresses, and delivered to Bello or other members of his organization.

After selling the drugs, Bello and other members his organization laundered the proceeds from the sale of these drugs through the banking system by exchanging small dollar denominations for large dollar denominations, typically $100 bills, that could be more easily transported by members of the drug organization when they traveled to Puerto Rico and the Dominican Republic to purchase more drugs.  At least $620,000 in cash exchanges were made in accounts controlled by Bello’s organization.  In one month alone in 2011, cash exchanges totaling approximately $58,000 were made in an account held in Bello’s name.

Members of the drug organization then bulk-cash smuggled the drug proceeds from New York to Puerto Rico and the Dominican Republic, hiding money in the pockets of jeans packed in luggage and in soap bottles.

Nine other defendants have pleaded guilty to conspiring to distribute cocaine or launder money as part of Bello’s drug trafficking organization.  On February 13, 2017, Joel Aguilar was sentenced to 72 months’ imprisonment for his involvement in distributing at least 150 kilograms of cocaine.  On November 2, 2017, U.S. postal carrier Jermaine Sandifer was sentenced to 60 months’ imprisonment for his involvement in distributing at least 150 kilograms of cocaine.  On August 8, 2017, Bello’s cousin Carlos Bello Tirado was sentenced to 48 months’ imprisonment.  On November 20, 2017, Ernest Pena was sentenced to time served for his involvement in distributing 85 kilograms of cocaine.

The government’s case is being handled by the Office’s International Narcotics and Money Laundering Section.  Assistant United States Attorneys Douglas M. Pravda and Julia Nestor are in charge of the prosecution.

Defendant Sentenced Today: LUIS BELLO
Age: 34
Residence: Bronx, New York

Defendants Previously Sentenced:

JOEL AGUILAR
Age: 39
Residence: New York, New York

CARLOS BELLO TIRADO
Age: 39
Residence: Leesburg, Florida

ERNEST PENA
Age: 34
Residence: Bronx, New York

JERMAINE SANDIFER
Age: 41
Residence: Perth Amboy, New Jersey

Defendants Awaiting Sentencing:

EMIL SANCHEZ
Age: 27
Residence: Bronx, New York

ANA ABREU
Age: 34
Residence: Bronx, New York

MARY ESTRELLA
Age: 27
Residence: Bronx, New York

KELVIN CISNERO SANTOS
Age: 42
Residence: Bronx, New York

SAUL OVALLES CORNIEL
Age: 36
Residence: Newark, New Jersey

E.D.N.Y. Docket Nos. 13-CR-559 (NGG) & 16-CR-309 (NGG)

Earlier today, in federal court in Brooklyn, former New York City Department of Buildings (DOB) Inspector Massimo Dabusco was sentenced by United States Chief District Court Judge Dora L. Irizarry to 18 months’ imprisonment for conspiracy to commit extortion, to be followed by a term of three years’ supervised release.  The Court also imposed a $4,000 fine. Dabusco, also known as “Max,” pleaded guilty to the charge on May 22, 2017.

Richard P. Donoghue, 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 Mark G. Peters, Commissioner, New York City Department of Investigation (DOI), announced the sentence.

“By engaging in extortionate conduct for personal financial gain, Dabusco violated the mission entrusted to him to enforce the New York City building and construction codes honestly and fairly,” stated United States Attorney Donoghue.  “This Office and our law enforcement partners will remain vigilant in rooting out corruption and prosecuting those, like Dabusco, who abuse their position of public trust.”

According to court filings, between December 2013 and June 2015, while serving as an inspector for the DOB, Dabusco was also a silent partner in a construction company, A&G Contracting Group Corp., in violation of New York City law.  Dabusco used his official position to influence property owners and contractors, over whom he had regulatory authority, to hire A&G, which was operated by his co-defendant Vito Menadi, to perform excavation and demolition jobs.  In exchange for his actions, Dabusco shared in A&G’s profits.  Dabusco also illegally warned other contractors about impending inspections by DOB and threatened economic harm against property owners and contractors if they did not pay outstanding fines owed by A&G.  Dabusco resigned from DOB in August 2015.  

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

The Defendant:

MASSIMO DABUSCO
Age: 55
Residence: Yorktown Heights, New York

E.D.N.Y. Docket No. 16-CR-559 (DLI)

Home Family Care, Inc. (HFC), a Brooklyn-based company that provides home health care services, and Alexander Kiselev, the co-owner and President of HFC, have entered into a civil settlement agreement under which they have agreed to pay $6,415,000 to resolve allegations that they violated the federal and state False Claims Acts by falsely billing Medicaid for home health care services that HFC did not provide to Medicaid recipients.  HFC’s former Vice President, Michael Gurevich, entered into a separate settlement regarding the same allegations. The settlement agreements were approved by United States District Judge Sterling Johnson, Jr.

Richard P. Donoghue, United States Attorney for the Eastern District of New York, announced the settlements.

“When health care providers seek and receive Medicaid funds for services that they never provided, they jeopardize the fiscal integrity of a critical health care program,” stated United States Attorney Donoghue.  “We will hold health care providers accountable for their violations of federal law.”  Mr. Donoghue thanked the Medicaid Fraud Control Unit of the Office of the New York State Attorney General, the Office of the Inspector General of the U.S. Department of Health and Human Services, and the New York Office of Field Operations and the Office of Associate Chief Counsel (New York) of U.S. Customs and Border Protection for their assistance in the investigation.

An investigation revealed that, from the time HFC began operating in or about 2008 until at least May 2014, HFC engaged in a fraudulent scheme to enrich itself at the expense of Medicaid by knowingly and systematically billing for home health aide and personal care aid services that were not in fact provided to Medicaid recipients.  To carry out this scheme, HFC directed its employees to deliberately circumvent its own system for verifying the attendance of aides at the homes of Medicaid recipients for whom the aides were allegedly providing care and to deliberately circumvent HFC’s internal controls that purported to ensure that aides were present in the recipients’ homes. 

The allegations were brought to the government’s attention through the filing of a complaint pursuant to the qui tam provisions of the False Claims Act.  Under the Act, private citizens can bring suit on behalf of the United States and share in any recovery. 

The United States’ case is being handled by Assistant United States Attorney Elliot M. Schachner of the Office’s Civil Division.

E.D.N.Y. Docket No. 10-CV-2490 (SJ)

A federal jury in Central Islip, New York, returned a guilty verdict last night against Anael Sainfil on three counts of a superseding indictment charging him with conspiracy to commit armed bank robbery, armed bank robbery and brandishing firearms during a crime of violence.  The verdict came after a four-day trial before Senior United States District Judge Leonard D. Wexler.    

Richard P. Donoghue, 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),  Patrick J. Ryder,  Commissioner, Nassau County Police Department (NCPD), and John Barry, Acting Commissioner, Suffolk County Police Department (SCPD).

“The brazen violence carried out by the defendant Anael Sainfil and his co-conspirators will not be tolerated,” stated United States Attorney Donoghue.  “This Office, together with our law enforcement partners, is committed to protecting the public from those who put the lives of men, women and children in our community in jeopardy.”  Mr. Donoghue expressed his appreciation to the FBI, NCPD and SCPD for their tireless efforts in bringing all participants involved in the robbery to justice.

The evidence at trial established that on November 9, 2015, the defendant, Anael Sainfil and his co-conspirators executed a plan to rob a Wells Fargo Bank branch in Hempstead, New York.  The defendant acted as a lookout as his co-conspirators entered the bank armed with a semi-automatic assault rifle and numerous other firearms.  While the defendant stood guard, an armed takeover of the bank took place.  Tellers and customers, including an 8-year old boy, were zip-tied and held captive as the bank’s vault was emptied of over $375,000.  The defendant and his cohorts were unaware that a bank teller had placed a wireless GPS tracker with the stolen money.  Hempstead Police Department Officers initiated a pursuit, which resulted in the apprehension of one of the gunman that day.  Following an extensive investigation by the FBI, NCPD and SCPD, all nine participants in the robbery conspiracy were ultimately apprehended, including Anael Sainfil, who was arrested on December 21, 2016.  The proceeds of the robbery were recovered.

When sentenced, Sainfil faces a minimum of seven years’ imprisonment, and a maximum of life imprisonment.

The government’s case is being handled by the Office’s Long Island Criminal Division.  Assistant United States Attorneys Mark E. Misorek and Erin Reid are in charge of the prosecution.

The Defendant:

ANAEL SAINFIL
Age: 22
Residence: Bay Shore, New York  

E.D.N.Y. Docket No. 16-CR-652 (S-1) (LDW)

Earlier today, in federal court in Brooklyn, Dirk Hall was sentenced by United States District Judge Eric N. Vitaliano to 41 months’ imprisonment, to be followed by five years of supervised release, after having pleaded guilty to conspiracy to commit bank fraud and wire fraud in connection with a multi-million dollar mortgage fraud scheme.

Richard P. Donoghue, United States Attorney for the Eastern District of New York, announced the sentencing.  Mr. Donoghue thanked the Federal Bureau of Investigation (FBI); the Federal Housing Finance Agency, Office of Inspector General (FHFA-OIG); the U.S. Department of Housing and Urban Development, Office of Inspector General (HUD-OIG); the Federal Deposit Insurance Corporation, Office of Inspector General (FDIC-OIG); and the New York State Department of Financial Services (DFS) for their hard work and dedication over the course of this multi-year investigation and prosecution. 

According to court filings and facts presented at the sentencing hearing, between September 2008 and May 2011, Hall, together with others, caused mortgage loan applications with false information to be submitted to lending institutions in connection with the purchase of residential properties located within the Eastern District of New York.  These applications contained fraudulently inflated purchase prices, as well as false information about the assets and income of the purchasers of the properties, many of whom were being compensated as part of the scheme to act as straw purchasers.  The defendant and his co-conspirators also provided false down payment checks to make it appear as if the straw purchasers and the other borrowers had made down payments in connection with the purchase of the properties, which was a condition of the lending institutions for issuing the mortgage loans.

To carry out their scheme, the defendant and his co-conspirators conducted simultaneous purchases and sales of the properties, sometimes called “flips,” in an effort to conceal their criminal involvement and to inflate the value of the properties.  To that end, the defendant and his co-conspirators, through the use of backdated and falsified documents, concealed from the lending institutions the fact that the purchase and sale had occurred on the same day and made it appear as if the transaction between the homeowner and the co-conspirator had occurred over 60 days prior to the sale from the co-conspirator to the straw purchaser.

As a result of the false applications and appraisals, the lending institutions were fraudulently induced to issue millions of dollars of mortgage loans secured by properties that had inflated appraisal values to individuals who had insufficient income and assets to qualify for the mortgage loans.  In many instances, the straw purchasers and the other borrowers failed to make required mortgage payments to the lending institutions, which caused the mortgage loans to be placed into default status.

The government’s case is being handled by the Office’s Business and Securities Fraud Section.  Assistant United States Attorneys David C. Pitluck, Mark E. Bini and Michael T. Keilty are in charge of the prosecution.

The Defendant:

DIRK HALL
Age: 42
Queens, New York

E.D.N.Y. Docket No. 14-CR-356 (S-1) (ENV)

Earlier today, in federal court in Brooklyn, Diane W. Lamm, a manager of Capital L Financial Group, LLC (Capital L) and Aegis Capital Fund, LLC (Aegis Capital Fund), was sentenced to 36 months’ imprisonment having pled guilty to two counts of securities fraud for defrauding investors out of millions of dollars in two separate schemes.  Lamm pled guilty to the charges on February 5, 2016.  The Court also ordered Lamm to pay restitution to the victims in the amount $15,640,582.46.  The sentencing took place before United States District Judge Frederic Block. 

Richard P. Donoghue, 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.

“To support their luxurious lifestyles, Lamm and her co-defendant stole millions of dollars from investors and their retirement accounts,” stated United States Attorney Donoghue.  “Today’s sentence sends a powerful message of deterrence to others who would consider deceiving investors.  This Office, together with our partners at the FBI, is committed to holding financial fraudsters accountable for their conduct.”

“Investment advisers are required to act in the best interest of their clients. Lamm did just the opposite by taking advantage of those who trusted her with their money, benefitting personally from illegitimately obtained profits,” stated FBI Assistant Director-in-Charge Sweeney.   “The FBI has dedicated a significant amount of resources to uncovering financial crimes targeted against individuals, businesses, and industries. Today’s sentencing serves as a fine example of our continued success in this area.”

Between 2009 and 2013, Lamm was involved in two schemes to steal investors’ money.  In the first, she and her co-defendant, John R. Lakian, obtained more than $11 million by promising Capital L investors that their money would be used to purchase, consolidate, and sell registered investment advisory businesses.  Instead, Lamm and her co-defendant diverted more than $3 million to themselves and to entities, including hospitality businesses that they owned and controlled.  In the second scheme, Lamm and her co-defendant embezzled money through their management of Aegis Capital Fund, a North Carolina-based investment fund that was placed into liquidation in 2011.  Prior to the liquidation, Lamm and her co-defendant directed more than $2.4 million of Fund assets into hospitality businesses without informing the Fund’s investors that Lamm and her co-defendant owned and controlled these businesses.  More than $1.9 million of the $2.4 million of Fund assets was never recovered by the investors.  Additionally, following the Fund’s liquidation, instead of returning investment proceeds to investors, Lamm and her co-defendant diverted more than $2 million of investors’ money to themselves and to their hospitality businesses.  The government has identified credit card charges and company expenses for purposes unrelated to the purchase, consolidation and sale of registered investment advisers.  Charges were incurred, for example, for clothing, furniture and fine art from luxury stores such as Bergdorf Goodman, Gucci and Paul Stewart; stays at the Palace and Waldorf Astoria hotels in New York City; getaways at luxury resorts; and items for Lamm and her co-defendant’s restaurant business.

Lamm’s co-defendant, John R. Lakian, pleaded guilty in February 2016 to two counts of securities fraud.  He was sentenced, on December 15, 2017, to 55 months’ imprisonment and ordered to pay restitution to the victims in the amount $15,640,582.46.

The government’s case is being handled by the Office’s Business and Securities Fraud Section.  Assistant United States Attorney Whitman G.S. Knapp is in charge of the prosecution.  Assistant United States Attorney Karin Orenstein of the Office’s Civil Division is responsible for the forfeiture of assets.

The Defendant:

DIANNE W. LAMM

Age: 57

New York, New York

E.D.N.Y. Docket No. 15-CR-0043 (FB)

United States Attorney Richard P. Donoghue announced today that the Eastern District of New York, working collaboratively with other offices as well as on its own, collected over $3.4 billion in criminal and civil actions in Fiscal Year 2017.  Of this amount, $3,109,923,738 resulted from cases handled in conjunction with other U.S. Attorneys’ Offices and components of the Department of Justice.  Collections from criminal and civil actions handled solely by the Eastern District of New York totaled $319,091,148, with $216,178,698 in criminal actions and $102,912,449 in civil actions.

“The Eastern District’s robust recoveries in Fiscal Year 2017 reflects the Office’s  commitment to justice by combatting fraud and other misconduct, forfeiting the proceeds and instrumentalities of crime, and providing restitution to the victims of crime,” stated U.S. Attorney Donoghue.

Overall, the Department of Justice collected just over $15 billion in civil and criminal actions in the fiscal year ending September 30, 2017. 

Additionally, working with partner agencies and divisions within the Department of Justice, the Eastern District forfeited $92,106,132 in assets tainted by crime.  Forfeited assets deposited into the Department of Justice Assets Forfeiture Fund are used to restore funds to crime victims and for a variety of law enforcement purposes.

FY 2017 Collections Highlights

In January 2017, the Eastern District of New York, in conjunction with its partners, recovered $3.1 billion in civil penalties from Deutsche Bank under the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA), to resolve claims related to Deutsche Bank’s conduct in the packaging, securitization, marketing, sale and issuance of Residential Mortgage Backed Securities (RMBS) prior to 2008.  In a Statement of Facts that accompanied the settlement, Deutsche Bank admitted to making false representations and omitting material information from disclosures to investors about the loans in its RMBS securitizations.

In September 2017, AmerisourceBergen Specialty Group (ABSG), a wholly-owned subsidiary of AmerisourceBergen Corporation, one of the nation’s largest wholesale drug companies and number 11 on the Fortune 500 list, pled guilty to illegally distributing misbranded drugs.  ABSG agreed to pay a total of $260 million to resolve criminal liability for its distribution of oncology supportive-care drugs from a facility that was not registered with the Food and Drug Administration (FDA). 

Collections Overview

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

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

Earlier today, in federal court in Brooklyn, Gregory St. Juste was sentenced to 100 months’ imprisonment by United States Chief District Judge Dora L. Irizarry for his role in three gun-point robberies of pharmacies.  St. Juste had previously pled guilty on February 16, 2017 to Hobbs Act robbery conspiracy and brandishing a firearm during the conspiracy.  On August 4, 2017, co-defendant Wensley Paul was sentenced to nine years’ imprisonment following his March 20, 2017 guilty plea to the same charges.  On October 24, 2017 and November 15, 2017, respectively, co-defendants Max Narcisse, Jr. and Jeff Roselien pleaded guilty to the same charges and are awaiting sentencing.

Richard P. Donoghue, United States Attorney for the Eastern District of New York, Ashan M. Benedict, Special Agent-in-Charge, New York Field Division, Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), and James P. O’Neill, Commissioner, New York City Police Department (NYPD), announced the sentence.

“Gregory St. Juste and his co-conspirators caused employees and customers to fear for their lives during the armed robberies of the targeted pharmacies,” stated United States Attorney Donoghue.  “Besides terrorizing his victims, the defendant stole oxycodone pills to resell on the street, contributing to the deadly opioid epidemic.  This Office and our law enforcement partners continue to work tirelessly to hold accountable those who seek to profit from this scourge that has taken such a great toll on the community.”

“St. Juste and his co-conspirators committed brazen acts of violence that endangered many in his community,” stated Special Agent-in-Charge Benedict.  “The violence was driven by the desire to profit from peddling death in the form of pills sold to individuals suffering through addiction. Thanks to the efforts of local and federal law enforcement, St. Juste will no longer be in a position to harm his community. I would like to extend my gratitude to the United States Attorney’s Office for their work in prosecuting the case. I would also like to thank the Special Agents and NYPD Detectives of the ATF Joint Robbery Task Force for their investigative efforts that helped bring St. Juste to justice.”

According to court filings and statements at court proceedings, in August and September 2016, the defendants and their co-conspirators conducted a series of gunpoint robberies of pharmacies in Brooklyn.  On August 16, 2016, two co-conspirators entered the Mill Basin Pharmacy on Avenue T.  While inside, the perpetrators pulled out a revolver and entered the back of the pharmacy, causing store employees, one of whom was pregnant, to cower in the corner.  The robbers made off with over $4,000 in prescription pills and merchandise, and escaped in a car driven by Roselien.  On September 8, 2016, St. Juste and a co-conspirator entered This Way Pharmacy on Quentin Road.  Inside the store, the robbers brandished a firearm, stole oxycodone pills and cash and again left in a getaway car driven by Roselien.  On September 13, 2016, St. Juste and two other co-conspirators entered the Living Word Pharmacy located on Utica Avenue.  St. Juste stormed into the back of the pharmacy and brandished a revolver.  The robbers made off with oxycodone pills, employees’ cell phones and cash, and left in a getaway car driven by Roselien.

On September 26, 2016, St. Juste, Paul and Naricisse robbed the Mill Park Pharmacy on Avenue U.  Upon entering the pharmacy, St. Juste pulled out a firearm and forced a store clerk to go behind a counter, demanding to know where the “oxy” was and threatening to shoot the clerk.  Narcisse then went behind the counter to the cash register and placed cigarettes, cash and other items into a backpack, while Paul acted as a lookout.  After a few minutes, the three perpetrators left the store and ran into the getaway car, which was driven by Roselien.  Shortly after the perpetrators left the scene, NYPD officers recognized Roselien’s car from the prior robberies and pulled it over, arresting all four defendants.  Upon searching the car, officers recovered a loaded, stolen .45 caliber pistol, as well as cash and the stolen merchandise.

The government’s case is being handled by the Office’s International Narcotics and Money Laundering Section.  Assistant United States Attorney Keith D. Edelman is in charge of the prosecution.  

Defendant Sentenced Today:

GREGORY ST. JUSTE
Age:  21
Brooklyn, New York

Defendant Previously Sentenced:

WENSLEY PAUL
Age: 25
Brooklyn, New York

Defendants Awaiting Sentencing:

MAX NARICSSE, JR.
Age: 25
Brooklyn, New York

JEFF ROSELIEN
Age: 31
Brooklyn, New York

E.D.N.Y. Docket No. 16-CR-554 (DLI)

Earlier today, in federal court in Central Islip, Angel M. Castillo was sentenced to 12 years’ imprisonment following his May 10, 2016 guilty plea to Transportation of Child Pornography in Interstate and Foreign Commerce.  The sentencing proceeding was held before United States District Judge Joan M. Azrack.  Castillo was also sentenced to 10 years’ supervised release to follow his prison sentence, during which time he must register as a sex offender and he will not be allowed unsupervised contact with minors.

Richard P. Donoghue, 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 John W. Barry, Acting Commissioner, Suffolk County Police Department (SCPD), announced the sentence.

According to court filings, in May 2014, Castillo was found by FBI agents and SCPD detectives to be sharing child pornography online via a peer-to-peer file sharing network.  A search warrant was executed on Castillo’s residence in February 2015, at which time Castillo admitted that he had a sexual interest in children.  He also admitted that he had been using the peer-to-peer network for about a year and a half to download child pornography and that he had saved images and videos to his computer.  Law enforcement recovered from Castillo’s computer over 600 videos and over 10,000 still images of child pornography, including the abuse of infants and toddlers.  

United States Department of the Navy records show that Castillo was convicted and received a General Court Martial on February 21, 2003, after a guilty plea to Indecent Acts and Liberties with a Child.  Castillo received a bad conduct discharge from the Navy and was sentenced to 54 months’ in custody (with 24 months suspended).

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

The Defendant:

ANGEL M. CASTILLO
Age:  44
Bay Shore, New York

E.D.N.Y. Docket No. 15-CR-519

Earlier today in federal court in Central Islip, Christopher Robert Grief, also known as “Mookie,” was sentenced to eight years’ imprisonment following his June 15, 2017 guilty plea to Receiving Child Pornography in Interstate and Foreign Commerce.  The sentencing proceeding was held before United States District Judge Joseph F. Bianco.  Grief was also sentenced to lifetime supervised release to follow his prison sentence, during which time he must register as a sex offender and he will not be allowed unsupervised contact with minors.

Richard P. Donoghue, 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 John W. Barry, Acting Commissioner, Suffolk County Police Department (SCPD), announced the sentence.

According to court filings, Grief, who used the online identity “Mookie,” frequented online “Dark Web” forums devoted to the sexual torture of infants and toddlers.  At the time of his arrest in September 2014, when a search warrant was executed on his residence, Grief admitted that he had a sexual interest in young children.  He also admitted that he had been using the dark web forum for about a year to post and download child pornography and to chat about torture of children and animals.  Grief further admitted that he had made and posted to the online forum a mutilation and torture video where he had abused a rat.  Law enforcement recovered child pornography, including a video of the rape of a three-month-old baby on Grief’s computer.  Grief has been incarcerated since his arrest.

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

The Defendant:

CHRISTOPHER ROBERT GRIEF (also known as “Mookie”)
Age:  30
Ridge, New York

E.D.N.Y. Docket No. 14-CR-555

Earlier today, following a two-week trial, a federal jury in Brooklyn returned guilty verdicts against Ronald Williams on five counts, including murder-for-hire conspiracy, conspiracy to commit obstruction of justice murder, and conspiracy to distribute marijuana.  Williams, a leader of a street gang in Brooklyn known as the ‘90s Crew that engaged in large-scale marijuana trafficking, faces a mandatory sentence of life in prison when he is sentenced by United States District Judge LaShann DeArcy Hall.

Richard P. Donoghue, United States Attorney for the Eastern District of New York, James J. Hunt, Special Agent-in-Charge, Drug Enforcement Administration, New York Division (DEA), and Angel M. Melendez, Special Agent-in-Charge for the Immigration and Customs Enforcement (ICE), Homeland Security Investigations (HSI) New York, announced the verdict.

“Ronald Williams, a violent gang leader and marijuana trafficker, showed his utter disregard for human life when he accepted without hesitation a $5,000 contract to kill someone suspected of being an informant for federal law enforcement,” stated United States Attorney Donoghue. “The outstanding work by this Office, together with our law enforcement partners, prevented a murder from taking place and has made our streets safer as a result of the arrest, prosecution and conviction of the defendant.”  Mr. Donoghue extended his grateful appreciation to the Bureau of Alcohol, Tobacco, Firearms and Explosives, U.S. Immigration and Customs Enforcement, the United States Marshal Service, and the New York City Police Department, for their assistance during the investigation.

“This conviction sets the record straight,” stated DEA Special Agent-in-Charge Hunt.  “As a high level gang member, Ronald Williams will pay the price for his crimes.  And this investigation demonstrates how DEA arrests those responsible for the by-products of drug trafficking: addiction, overdoses, crime, murders and violence.” SAC Hunt also thanked the U.S. Attorney’s Office EDNY, HSI, NYPD and ATF for their tireless efforts on this investigation.

“This drug pushing convicted felon was up to his old tricks, leading the notorious ‘90s Crew in Brooklyn. And, he put a dollar value on an individual’s life by agreeing to have the murder of a suspected informant carried out,” stated HSI Special Agent-in-Charge Melendez New York. “No one is invincible. We will continue working with the DEA and our other law enforcement partners to ensure that those who think they are above the law are brought to justice.”

The evidence at trial established that on April 26, 2013, DEA agents followed the co-defendant as he was making a delivery of marijuana to a customer in Brooklyn.  The co-defendant spotted federal agents who were conducting surveillance and he fled, suspecting that his marijuana customer was an informant providing information to federal law enforcement.  On April 30, 2013, the co-defendant called Williams and offered to pay him $5,000 to kill the individual he believed was a federal informant.  Williams agreed to commit the murder and began planning the murder including selecting a gang member to carry out the contract. When the co-defendant told Williams that he would personally kill the suspected informant but wanted to have an alibi, Williams responded that it would better to pay someone else to kill the informant and “get it right.”  However, federal agents were able to identify the potential victim, and the murder was not carried out.   

Williams was also convicted of being a felon in possession of a firearm and ammunition found during the execution of a search warrant at his residence, and using a firearm in connection with the charged drug trafficking crime.  The items recovered during a search of Williams’ residence on East 96th Street in Brooklyn included three handguns and several pounds of marijuana, a drug ledger, a safe, and a police scanner. The co-defendant is awaiting trial.

The government’s case is being handled by the Office’s International Narcotics and Money Laundering Section. Assistant United States Attorneys Nathan D. Reilly and Hiral D. Mehta are in charge of the prosecution.

The Defendant:

RONALD WILLIAMS (also known as “Blackman,” “Jermaine,” “Leon Gordon,” and Marcus Reese”)
Age: 43
Brooklyn, New York

E.D.N.Y. Docket No. 13-CR-419 (LDH)

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UPDATE

Following an order granting the defendant a new trial on certain charges, in February 2020, the defendant was again convicted of deprivation of civil rights, aggravated sexual abuse and sexual abuse.

___________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

Earlier today, after a two week trial, a federal jury in Brooklyn returned a guilty verdict against Carlos Richard Martinez, a federal correctional officer employed by the United States Bureau of Prisons (BOP) on charges of deprivation of civil rights, aggravated sexual abuse, sexual abuse, and sexual abuse of a ward.  The 20-count indictment covered four sexual assaults by Martinez from December 13, 2015 to April 2016, involving five separate sexual acts.  Martinez faces a maximum sentence of life in prison when he is sentenced by United States District Judge Edward R. Korman.

Richard P. Donoghue, United States Attorney for the Eastern District of New York, Ronald G. Gardella, Special Agent-in-Charge, United States Department of Justice, Office of the Inspector General, New York Field Office (OIG), and William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the verdict.

“As found by the jury, Carlos Richard Martinez willfully abused his position of power as a federal correctional officer by repeatedly raping a female inmate entrusted to his care at the Metropolitan Detention Center in Brooklyn,” stated United States Attorney Donoghue.  “Martinez exploited the victim’s fear of being punished with additional jail time and other disciplinary action, but his attempts to intimidate the victim into silence ultimately failed as evidenced by her brave testimony at the trial.  Martinez has now been held to account for violent, criminal misconduct that will never be tolerated in a correctional institution.”

“Martinez’s conduct was reprehensible.  Today’s verdict sends a clear message that no correctional officer is above the law,” stated OIG Special Agent-in-Charge Gardella.   “The OIG is fiercely committed to working with its law enforcement partners to investigate and prosecute instances of sexual abuse and abuse of power within our federal prison system.”

“While already serving time in prison, Martinez’s victim found herself trapped behind the bars of his abhorrent behavior,” stated FBI Assistant Director-in-Charge Sweeney. “Not only did Martinez engage in an outrageous act of sexual abuse, but he threatened the victim with severe punishment should she reveal his crime.  There is only one place in society for those who use positions of power to violate the civil rights of others, especially in cases of outright forcible abuse, and that place is behind bars—not in front of them violating the rights of those they’re charged to watch.”

The evidence at trial established that over a five-month period from December 2015 to April 2016, Martinez, while serving as a lieutenant at the Metropolitan Detention Center in Brooklyn (MDC) with supervisory and disciplinary authority over inmates, used physical force and fear to repeatedly rape a sentenced female prisoner.  The victim, who is identified in the indictment as “Jane Doe,” and testified at trial using the name “Maria,” spoke little English and worked as a cleaner inside the prison.  Martinez directed Jane Doe and other female prisoners to clean on the second floor of the MDC’s East Building, including the lieutenant’s office.  On December 13, 2015, Martinez’s sexually inappropriate remarks to Jane Doe escalated to violent, criminal conduct.  While Jane Doe was preparing to clean the lieutenants’ office on that Sunday, Martinez exposed his erect penis, forcibly grabbed Jane Doe by the back of her head and forced her to perform oral sex on him.  Then Martinez pulled down Jane Doe’s pants and underwear and raped her.  Jane Doe expressed concern that she might become pregnant and begged Martinez to give her an emergency contraceptive pill, which he purchased at Rite Aid store near his home in Brooklyn.  Martinez warned Jane Doe that she would be placed in the Special Housing Unit (SHU), and receive additional jail time to serve, if she told anyone what he had done.  In the ensuing months, Martinez repeatedly raped Jane Doe while she cleaned on the weekend, when the lieutenants’ office area of the second floor of the MDC is generally empty.  Jane Doe testified that during the attacks in his office, Martinez monitored security video footage on his computer of the area surrounding the lieutenants’ office to make sure that no one would discover him sexually assaulting her.

The government’s case is being handled by the Office’s Public Integrity Section. Assistant United States Attorneys Nicole M. Argentieri and Nadia I. Shihata are in charge of the prosecution.

The Defendant:

CARLOS RICHARD MARTINEZ
Age: 48
Residence: Brooklyn, New York,

E.D.N.Y. Docket No. 17-CR-281 (ERK)