Southern District of New York

Geoffrey S. Berman, United States Attorney for the Southern District of New York, and Darcel D. Clark, Bronx District Attorney, announced the unsealing yesterday of a Superseding Indictment charging JERRY ROJAS, a/k/a “Feddi,” with the January 13, 2020, murder of Vladimir Olivo, 42, in the vicinity of Northern Boulevard and 208th Street in Queens, New York.  The case has been assigned to United States District Judge Jesse M. Furman.  ROJAS was arrested yesterday and presented before U.S. Magistrate Judge Thérèse Wiley Dancks in the Northern District of New York.

U.S. Attorney Geoffrey S. Berman said:  “As alleged in the Indictment, Jerry Rojas murdered Vladimir Olivo earlier this year.  Thanks to the outstanding work of the NYPD, DEA, and the Special Agents of our Office, Rojas now faces federal murder charges for this terrible crime.  I want to specially thank District Attorney Clark for the collaboration between our offices that helped make this prosecution possible.”

As alleged in the Superseding Indictment unsealed yesterday in Manhattan federal court[1]: 

JERRY ROJAS, a/k/a “Feddi,” is a member of the Black Stone Gorilla Gang, a racketeering enterprise that operates principally in the New York City metropolitan area and in the jails and prisons of New York City and the State of New York.  In order to enrich the enterprise, preserve and protect the power of the enterprise, and enhance its criminal operations, BSGG members and associates committed, conspired, attempted, and threatened to commit acts of violence, including murder and assaults; distributed and possessed with intent to distribute narcotics; committed robberies; engaged in bank fraud and wire fraud; and obtained, possessed, and used firearms.  BSGG members also evaded prosecution by law enforcement authorities through acts of intimidation and violence against potential witnesses to crimes committed by the gang.

On or about January 13, 2020, ROJAS shot and killed Vladimir Olivo in the vicinity of Northern Boulevard and 208th Street in Queens.

ROJAS is also charged with participating in a conspiracy to distribute heroin, cocaine, cocaine base, oxycodone, and marijuana from in or about 2011 through in or about March 2020, and using a firearm in furtherance of that conspiracy.           

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ROJAS, 26, is charged in the following counts of the Superseding Indictment:

COUNT

CHARGE

MAX. PENALTY

Count One

Racketeering Conspiracy

18 U.S.C. § 1962(d)

Life imprisonment

Count Ten

Narcotics Conspiracy

21 U.S.C. § 846

Life

Mandatory minimum of 10 years’ imprisonment

Count Eleven

Firearms Offense

18 U.S.C. §§ 924(c) and 2

Life

Mandatory minimum of 5 years’ imprisonment

Count Twelve

Murder in Aid of Racketeering

18 U.S.C. §§ 1959 and 2

Death or life imprisonment;

Mandatory minimum of life imprisonment

Count Thirteen

Murder through the Use of a Firearm

18 U.S.C. §§ 924(j) and 2

Death or life imprisonment;

Mandatory minimum of five years’ imprisonment

Mr. Berman praised the outstanding investigative work of the NYPD, DEA, and the Special Agents of the United States Attorney’s Office for the Southern District of New York.  Mr. Berman also thanked the New York/New Jersey Regional Fugitive Task Force of the United States Marshals Service for its work in apprehending ROJAS.

This case is being handled by the Office’s Violent and Organized Crime Unit.  Assistant United States Attorneys Danielle R. Sassoon, Andrew K. Chan, and Brandon Harper, and Special Assistant United States Attorney Jaclyn Wood, are in charge of the prosecution.

The charges contained in the Indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.

[1]              As the introductory phrase signifies, the entirety of the text of the Indictment and the descriptions of the Indictment constitute only allegations, and every fact described should be treated as an allegation.

Geoffrey S. Berman, United States Attorney for the Southern District of New York, announced that PETER BRIGHT, a former technology editor for an online publication, was convicted in Manhattan federal court Monday of attempted child enticement.  BRIGHT was convicted after a one-week jury trial before U.S. District Judge P. Kevin Castel.

U.S. Attorney Geoffrey S. Berman said:  “As the jury found, Peter Bright attempted the basest type of crime, arranging to engage in sex with young children.  Thanks to the FBI, Bright is in custody and facing serious prison time.”

According to the allegations contained in the Complaint, Indictment, and the evidence presented at trial:

In April 2019, BRIGHT reached out online to an undercover agent of the Federal Bureau of Investigation (“FBI”), who was posing as the mother of a 7-year-old girl and 9-year-old boy (the “Minors”).  Over the course of hundreds of chat communications, BRIGHT discussed with the undercover agent BRIGHT’s plan to meet the Minors to engage in sexual activity.  BRIGHT also requested photographs of the Minors. 

In May 2019, BRIGHT met the undercover agent at a public park in New York, New York, for the purpose of engaging in sexual activity with the Minors.  As BRIGHT and the undercover agent began walking to the Minors’ residence, BRIGHT was arrested. 

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BRIGHT, 39, of Brooklyn, New York, was convicted of one count of attempted enticement of a minor to engage in illegal sexual activity, which carries a mandatory minimum sentence of 10 years in prison and a maximum sentence of life in prison.  The maximum potential sentence is prescribed by Congress and is provided here for informational purposes only, as the sentencing of the defendant will be determined by the judge.

BRIGHT is scheduled to be sentenced on June 29, 2020, at 11:30 a.m.

Mr. Berman praised the outstanding investigative work of the FBI. 

The prosecution of this case is being handled by the Office’s General Crimes Unit.  Assistant United States Attorneys Alexander Li, Michael D. Maimin, and Timothy T. Howard, and paralegal specialist Ariella Fetman, are in charge of the prosecution.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, Darcel D. Clark, District Attorney for Bronx County, Dermot Shea, Commissioner of the New York City Police Department (“NYPD”), Ray Donovan, Special Agent in Charge of the New York Division of the U.S. Drug Enforcement Administration (“DEA”), Peter C. Fitzhugh, Special Agent in Charge of Homeland Security Investigations in New York (“HSI”), and Cynthia Brann, Commissioner of the New York City Department of Correction (“NYCDOC”), announced today the unsealing of an Indictment charging ALEXANDER ARGUEDAS, a/k/a “Reckless,” MICHAEL DELAGUILA, a/k/a “Grizz,” STEVEN JUSTO, a/k/a “Riko,” DAVONTE BROWN, a/k/a “Tae,” JACOBB PADIN, a/k/a “Chino,” EDGARDO BARANCO, a/k/a “Slime,” ABBAS OZKURT, a/k/a “AB,” JAHVONNE CHAMBERS, a/k/a “JV,” DENISE BULLOCK, a/k/a “Mocha,” SIMONE CORDERO, a/k/a “Mixy,” MATTHEW NIEVES, a/k/a “WB,” TYERANCE MICKEY, a/k/a “Hoodlum,” and MARK BROCK, a/k/a “Rover,” with racketeering, firearms, and narcotics offenses, in connection with their membership and association with the Black Stone Gorilla Gang (“BSGG”).  ARGUEDAS is also charged with the December 9, 2012, murder of Gary Rodriguez.  ANDRE CURRY, a/k/a “Flex,” is charged with narcotics and firearms offenses.

Seven defendants were arrested today and will be presented this afternoon before United States Magistrate Judge Stewart D. Aaron.  Three defendants were already in federal or state custody on other charges.  The case has been assigned to United States District Judge Jesse M. Furman.

Manhattan U.S. Attorney Geoffrey S. Berman said:  “Today’s indictment charges members and associates of a violent gang that allegedly wreaked havoc in the Bronx for years, committing numerous acts of violence against rival gang members and innocent victims.  These charges are the product of a joint effort between our Office and the Bronx District Attorney’s Office, whom we thank for their outstanding partnership, not only in this case, but in our ongoing, shared commitment to keeping the people of the Bronx safe from violence.  Because of that partnership, and thanks to the extraordinary efforts of the NYPD, DEA, Department of Correction, HSI, and Special Agents of the U.S. Attorney’s Office, the defendants now face federal charges for their alleged crimes.”           

Bronx District Attorney Darcel D. Clark said:  “This gang has allegedly brought violence, guns and illicit narcotics to Bronx streets, and my Office’s partnership with U.S. Attorney Geoffrey Berman, the NYPD, the DEA, the Department of Correction, and HSI has now brought them to justice. We remain unrelenting in putting such violent criminal enterprises out of business.”

NYPD Commissioner Dermot Shea said:  “The NYPD’s work to identify and dismantle gangs and crews, and prevent the violence so often associated with their activities, continues to be of paramount importance to the NYPD and all our law enforcement partners.  I thank the NYPD detectives involved in this case and our law enforcement partners for their hard work which resulted in these arrests.”

DEA Special Agent in Charge Ray Donovan said:  “With deep rooted history of violence both in and outside of prison, the Black Stone Gorilla Gang is a fierce threat to New Yorkers.  Today’s arrests have put an alleged murderer in jail along with 13 other gang associates allegedly embedded in racketeering, fraud, firearms, narcotics trafficking and/or assaults.  I thank our law enforcement partners for their collaboration and partnership.” 

NYCDOC Commissioner Cynthia Brann said:  “Our Correction Intelligence Bureau works tirelessly to reduce violence and increase safety in our facilities, and we are proud of their hard work in this case, which involved many hours of collaboration with our fellow law enforcement partners.  Gang activity drives a disproportionate amount of violence in our city, in both the streets and the jails, and because of these efforts both communities are safer.”

HSI Special Agent in Charge Peter C. Fitzhugh said:  “HSI is always willing to assist our law enforcement partners in any criminal investigation where our resources, capabilities and personnel can be of value.  Bringing these dangerous individuals to face justice is why we invest in the specialized training and equipment we keep at the ready.  HSI and our law enforcement partners will continue to thrive in arresting those most dangerous because of the dedication and teamwork we put forward.”

According to the allegations in the Indictment unsealed today in Manhattan federal court[1]:

ALEXANDER ARGUEDAS, a/k/a “Reckless,” MICHAEL DELAGUILA, a/k/a “Grizz,” STEVEN JUSTO, a/k/a “Riko,” DAVONTE BROWN, a/k/a “Tae,” JACOBB PADIN, a/k/a “Chino,” EDGARDO BARANCO, a/k/a “Slime,” ABBAS OZKURT, a/k/a “AB,” JAHVONNE CHAMBERS, a/k/a “JV,” DENISE BULLOCK, a/k/a “Mocha,” SIMONE CORDERO, a/k/a “Mixy,” MATTHEW NIEVES, a/k/a “WB,” TYERANCE MICKEY, a/k/a “Hoodlum,” and MARK BROCK, a/k/a “Rover,” are members and associates of the Black Stone Gorilla Gang, a racketeering enterprise that operates principally in the New York City metropolitan area and in the jails and prisons of New York City and the State of New York.  In order to enrich the enterprise, preserve and protect the power of the enterprise, and enhance its criminal operations, BSGG members and associates committed, conspired, attempted, and threatened to commit acts of violence, including murder and assaults; distributed and possessed with intent to distribute narcotics; committed robberies; engaged in bank fraud and wire fraud; and obtained, possessed, and used firearms.  BSGG members also evaded prosecution by law enforcement authorities through acts of intimidation and violence against potential witnesses to crimes committed by the gang.

On or about December 9, 2012, ARGUEDAS shot and killed Gary Rodriguez in the vicinity of 3089 Decatur Avenue in the Bronx, New York.

In or around 2018, ARGUEDAS and others conspired to murder a fellow BSGG member who had fallen out of ARGUEDAS’s favor.  At ARGUEDAS’s direction, another gang member shot at that individual.

On or about August 27, 2018, at ARGUEDAS’s direction, CHAMBERS attempted to slash a rival gang member with a scalpel in the Bronx, New York.

On or about November 12, 2019, ARGUEDAS and MICKEY assaulted a fellow BSGG member with a chair in the vicinity of 3063 Hull Avenue in the Bronx, New York.

On or about November 12, 2019, BROCK slashed an individual across the face in Manhattan, New York.

The defendants are also charged with participating in a conspiracy to distribute heroin, cocaine, cocaine base, oxycodone, and marijuana from in or about 2011 through in or about March 2020.                

*                *                *

A chart containing the names, charges, and maximum and minimum penalties for the defendants is set forth below.  The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge.

Mr. Berman praised the outstanding investigative work of the NYPD’s Gun Violence Suppression Division and Financial Crimes Task Force, the DEA, the NYCDOC Correction Intelligence Bureau, HSI, and the Special Agents of the U.S. Attorney’s Office.

This case is being handled by the Office’s Violent and Organized Crime Unit.  Assistant United States Attorneys Danielle R. Sassoon, Andrew K. Chan, and Brandon Harper, and Special Assistant United States Attorney Jaclyn M. Wood, are in charge of the prosecution.

The charges contained in the Indictment are merely accusations and the defendants are presumed innocent unless and until proven guilty.

COUNT

CHARGE

DEFENDANTS

MAX. PENALTY

Count One

Racketeering Conspiracy

18 U.S.C. § 1962(d)

ALEXANDER ARGUEDAS

MICHAEL DELAGUILA

STEVEN JUSTO

DAVONTE BROWN

JACOBB PADIN

EDGARDO BARANCO

ABBAS OZKURT

DENISE BULLOCK

SIMONE CORDERO

MATTHEW NIEVES

Life imprisonment

JAHVONNE CHAMBERS

20 years’ imprisonment

Count Two

Murder in Aid of Racketeering

18 U.S.C. §§ 1959 and 2

ALEXANDER ARGUEDAS

Death or life Imprisonment;

Mandatory minimum of life imprisonment

Count Three

Murder through the Use of a Firearm

18 U.S.C. §§ 924(j) and 2

ALEXANDER ARGUEDAS

Death or life imprisonment;

Mandatory minimum of five years’ imprisonment

Count Four

Conspiracy to Commit Murder in Aid of Racketeering and Assault with a Dangerous Weapon in Aid of Racketeering

ALEXANDER ARGUEDAS

10 years’ imprisonment

Court Five

Attempted Murder and Assault with a Dangerous Weapon in Aid of Racketeering

18 U.S.C. §§ 1959 and 2

ALEXANDER ARGUEDAS

20 years’ imprisonment 

Count Six

Firearms offense

18 U.S.C. §§ 924(c) and 2

ALEXANDER ARGUEDAS

Life imprisonment

Mandatory minimum of ten years’ imprisonment

Count Seven

Attempted Assault with a Dangerous Weapon in Aid of Racketeering

18 U.S.C. §§ 1959 and 2

ALEXANDER ARGUEDAS

JAHVONNE CHAMBERS

3 years’ imprisonment

Count Eight

Assault with a Dangerous Weapon in Aid of Racketeering

18 U.S.C. §§ 1959 and 2

ALEXANDER ARGUEDAS

TYERANCE MICKEY

20 years’ imprisonment

Count Nine

Maiming, Assault with a Dangerous Weapon, and Assault Resulting in Serious Bodily Injury in Aid of Racketeering

18 U.S.C. §§ 1959 and 2

MARK BROCK

20 years’ imprisonment

Count Ten

Narcotics Conspiracy

21 U.S.C. § 846

ALEXANDER ARGUEDAS

MICHAEL DELAGUILA

STEVEN JUSTO

DAVONTE BROWN

JACOBB PADIN

EDGARDO BARANCO

ABBAS OZKURT

DENISE BULLOCK

SIMONE CORDERO

MATTHEW NIEVES

ANDRE CURRY

Life

Mandatory minimum of 10 years’ imprisonment

Count Eleven

Firearms Offense

18 U.S.C. §§ 924(c) and 2

ALEXANDER ARGUEDAS

MICHAEL DELAGUILA

STEVEN JUSTO

JACOBB PADIN

EDGARDO BARANCO

ABBAS OZKURT

MATTHEW NIEVES

ANDRE CURRY

Life

Mandatory minimum of 5 years’ imprisonment

[1] As the introductory phrase signifies, the entirety of the text of the Indictment constitutes only allegations, and every fact described herein should be treated as an allegation.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced that CRISTIAN FERNANDEZ was sentenced to 204 months in prison for conspiring to distribute heroin and possessing firearms in furtherance of drug trafficking between 2017 and 2018.  Fernandez pled guilty on December 5, 2019, before U.S. District Court Judge Vincent L. Briccetti, who imposed today’s sentence.

Manhattan U.S. Attorney Geoffrey S. Berman said:  “Cristian Fernandez was a leader of a transnational criminal organization that trafficked illegal guns and drugs.  Today he was handed the lengthy prison sentence his crimes deserve.”

According court filings and statements made at public court proceedings:

Between 2017 and 2018, FERNANDEZ led a transnational criminal organization that trafficked drugs and guns in Port Chester, New York, and other locations throughout the United States.  FERNANDEZ received kilograms of heroin from a supplier in Mexico and headed a network of co-conspirators who helped distribute the drugs for profit in different parts of the United States. 

In addition to trafficking drugs, FERNANDEZ also operated a firearms business, through which he sold and possessed at least six firearms, five of which were operable.  In one transaction, on December 12, 2017, FERNANDEZ sold a 7.62 millimeter AK-type rifle with evidence of discharge in the barrel and a 20-gauge shotgun, both operable, along with nearly 450 grams of heroin mixed with fentanyl for the total price of $25,600.

*                *                *

In addition to the prison term, FERNANDEZ, 45, of Port Chester, New York, was sentenced to five years of supervised release and ordered to forfeit $570,000, including $51,869 in cash that was seized from his residence on the day of his arrest.

 Mr. Berman praised the outstanding investigative work of the FBI and the Port Chester Police Department.  Mr. Berman also thanked the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Westchester County Police Department, and the Peekskill Police Department for their assistance in this investigation. 

This case is being handled by the Office’s White Plains Division.  Assistant United States Attorneys Olga Zverovich and Samuel Adelsberg are in charge of the prosecution.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, Douglas Shoemaker, the Special Agent in Charge of the New York Regional Investigations Office of the United States Department of Transportation Office of Inspector General (“DOT-OIG”), and Carolyn Pokorny, Metropolitan Transportation Authority Inspector General for the State of New York (“MTA-OIG”), announced that PARESH PATEL, a former MTA manager, pled guilty today before U.S. Magistrate Judge Ona T. Wang to obstructing a federal investigation into bid rigging and fraud in connection with contracts awarded by the MTA for Superstorm Sandy-related subway repairs.  PATEL, who set up a private company that participated in a bid for a project that he would oversee at the MTA, took numerous steps upon learning that his conduct was being investigated, including deleting an email account, asking others to destroy evidence, and encouraging others to lie to authorities to obstruct the investigation.  PATEL previously surrendered to federal authorities on February 18, 2020. 

U.S. Attorney Geoffrey S. Berman said:  “In the wake of Superstorm Sandy, Paresh Patel set up a company so that he and his family could profit from the work that was being done to repair our subways.  When Patel learned he was under investigation, he destroyed evidence and asked others to lie to federal and local investigators.  Efforts to obstruct investigations into corruption at the MTA undermine the public’s faith in the nation’s largest public transportation system and threaten the ability of our Government to ensure that justice is done.”

DOT-OIG Special Agent in Charge Douglas Shoemaker said:  “The devastation caused by Hurricane Sandy is only exacerbated by the unscrupulous actions of Mr. Patel, who was entrusted with aiding in the restoration of the New York region’s transit infrastructure. Working with our law enforcement and prosecutorial partners, we will continue to protect the taxpayers’ investment in our nation’s infrastructure and pursue those who participate in fraud schemes that undermine DOT-funded programs and projects, and the public trust.”

MTA Inspector General Carolyn Pokorny said:  “It is simply unacceptable for an MTA employee to obstruct any investigation - let alone a criminal investigation.  We are proud that our initial probe has resulted in derailing this scheme to defraud riders, taxpayers, and other stakeholders of our great transportation system, and thankful to our law enforcement partners who worked with us to leave no doubt that obstructing a federal investigation is a crime.”

According to the allegations made in the Information to which the defendant pled guilty, as well as the defendant’s admissions in court:

In order to manage necessary subway rehabilitation work following Superstorm Sandy in 2013, the MTA awarded construction management contracts for managers to oversee post-Sandy subway projects.  To prevent self-dealing and the appearance of corruption, the MTA maintains rules relating to conflicts of interest.  The rules provide that MTA employees are barred from participating in the selection, award, or administration of a contract if the employee, his or her family member, or an organization that employs the employee or one of the employee’s family members has a financial interest in any of the companies that propose or bid on, or are awarded, such a contract.

PATEL was a program manager at the MTA and was responsible for awarding contracts and exercising oversight of Superstorm Sandy-related subway repairs.  In June 2014, PATEL and another MTA employee set up an engineering consulting firm named Satkirti Consulting Engineering LLC (“Satkirti”).  Because MTA rules prohibited them from having an interest in such a company, PATEL and the other employee registered Satkirti in the names of their children, and then transferred the ownership to a friend of PATEL who played no substantive role in the management of Satkirti.  In February 2015, Satkirti was awarded a contract as a subcontractor on the Joralemon Tube subway rehabilitation project, which project PATEL would oversee in his role at the MTA.  Although the technical employees of Satkirti who sought and carried out the subcontract were PATEL’s friend, who had no background or qualifications in engineering, and a second individual who PATEL recruited from a pizzeria owned by PATEL, PATEL directed the operations of Satkirti and its employees while concealing his involvement with the company.  Among other things, PATEL created a company email account for Satkirti, and instructed Satkirti’s employees about what to write in emails.  On many occasions, PATEL instructed Satkirti’s employees not to mention PATEL’s name and reminded them that PATEL was not supposed to be involved in the operation of Satkirti.

In the spring of 2016, MTA-OIG launched an investigation, later joined by the DOT-OIG and the U.S. Attorney’s Office, into the contract that was awarded to Satkirti.  MTA-OIG served subpoenas and conducted interviews with individuals involved in Satkirti, many of whom made false statements about their and PATEL’s involvement in the company.  After MTA-OIG began serving subpoenas, PATEL told one of Satkirti’s employees to delete from his personal email account all emails with PATEL.  On November 16, 2016, after federal investigators began serving grand jury subpoenas, PATEL deleted the Satkirti company email account, which contained records of Satkirti’s business and evidence that would have connected PATEL to Satkirti.  Over the course of the MTA-OIG and federal investigation, at the request of PATEL, several individuals questioned by investigators also concealed and lied about PATEL’s involvement in Satkirti. 

*                *                *

PARESH PATEL, 59, of Paramus, New Jersey, pled guilty to one count of obstruction of justice, which carries a maximum sentence of 20 years in prison. 

PATEL will be sentenced by U.S. District Judge Kimba M. Wood on a date to be determined. 

The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge. 

Mr. Berman praised the outstanding investigative work of the special agents from the DOT-OIG and investigators at the MTA-OIG.

The case is being handled by the Office’s Public Corruption Unit.  Assistant United States Attorneys Nicolas Roos and Ryan B. Finkel are in charge of the prosecution.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, and William F. Sweeney Jr., Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), Dermot Shea, Commissioner of the New York City Police Department (“NYPD”), Catherine A. Hermsen, U.S. Food and Drug Administration Assistant Commissioner for Criminal Investigations (“FDA-OCI”), and Troy Miller, Director of Field Operations for U.S. Customs and Border Protection in New York (“CBP”), announced the unsealing of four indictments charging 27 individuals with offenses relating to the systematic and covert administration of illegal performance-enhancing drugs (“PEDs”) to racehorses competing across the United States and abroad. The Indictments unsealed today each allege the shipment and administration of adulterated and misbranded drugs designed to secretly and dangerously enhance the racing performance of horses beyond their natural ability, a dishonest practice that places the lives of affected animals at risk.

Of the 27 defendants, 19 – including trainers JORGE NAVARRO and JASON SERVIS – are charged in an indictment detailing four conspiracies to manufacture, distribute, and administer adulterated or misbranded drugs as set forth in United States v. Jorge Navarro, et al., 20 Cr. 160 (the “Navarro Indictment”), which has been assigned to U.S. District Judge Mary Kay Vyskocil.  Of those defendants, 13 were taken into federal custody and are expected to be presented in the Southern District of New York today before U.S. Magistrate Judge Ona T. Wang.  Defendant SETH FISHMAN was previously charged by complaint in United States v. Seth Fishman, 19 Mag. 10120, and arrested on October 28, 2019, in Miami, Florida, and was presented in U.S. District Court for the Southern District of Florida. The remaining defendants were arrested today outside of the Southern District of New York and adjacent districts, and will be presented today before the appropriate District Courts.

Four additional defendants are charged in United States v. Louis Grasso, et al., 20 Cr. 163 (the “Grasso Indictment”), which has been assigned to U.S. District Judge P. Kevin Castel.  Two defendants are charged in United States v. Scott Robinson and Scott Mangini, 20 Cr. 162 (the “Robinson Indictment”), assigned to U.S. District Judge J. Paul Oetken; and two defendants are charged in United States v. Sarah Izhaki and Ashley Lebowitz, 20 Cr. 161 (the “Izhaki Indictment”), assigned to U.S. District Judge Mary Kay Vyskocil. 

Manhattan U.S. Attorney Geoffrey S. Berman said:  “Today’s unsealing of four indictments for widespread doping of racehorses is the largest ever of its kind from the Department of Justice.  These defendants engaged in this conduct not for the love of the sport, and certainly not out of concern for the horses, but for money.  And it was the racehorses that paid the price for the defendants’ greed.  The care and respect due to the animals competing, as well as the integrity of racing, are matters of deep concern to the people of this District and to this Office.”

FBI Assistant Director William F. Sweeney Jr. said:  “These men allegedly saw the $100 billion dollar global horse racing industry as their way to get rich at the expense of the animals that were doing all the hard work.  Our investigation reveals the cruelty and inhumane treatment these horses suffered all to win a race.  The FBI New York Joint Eurasian Organized Crime Task Force worked along with our law enforcement partners at the New York State Police, FDA, and DEA to stop this ring of criminals from abusing helpless animals simply so they could cheat the odds and rake in millions of dollars.”

Police Commissioner Dermot Shea said:  “I want to commend our NYPD investigators, working with our federal partners, for carrying out a meticulous and important investigation. Putting the lives of horses at the center of an alleged plot to cheat professional horseracing around the world can never be accepted.”

FDA Assistant Commissioner for Criminal Investigations Catherine A. Hermsen said:  “The FDA is responsible for protecting not only the health of humans, but also of animals.  The manufacturing and trafficking of misbranded and unapproved animal drugs, and the administering of such drugs to racehorses to enhance their performance at the track, seriously endangers the health of these animals in pursuit of financial gain.  Today’s announcement should serve as a reminder of our continued focus on those individuals and companies that put profits ahead of the public health.”

CBP Director of Field Operations Troy Miller said:  “U.S. Customs and Border Protection is proud to have collaborated with our fellow law enforcement partners during this investigation. We value our partnerships and the arrests today demonstrate that together, no matter how complex the case, we will do what it takes to bring those who violate the law to justice.”

According to the allegations contained in the Indictments,[1] other filings in this case, and statements during court proceedings:

The charges in these four Indictments arise from an investigation of widespread schemes by racehorse trainers, veterinarians, PED distributors, and others to manufacture, distribute, and receive adulterated and misbranded PEDs and to secretly administer those PEDs to racehorses competing at all levels of professional horseracing.  By evading Food and Drug Administration (“FDA”) rules and regulations, as well as prohibitions against the use of PEDs, and by deceiving regulators and horse racing officials, participants in these schemes sought to improve race performance and obtain prize money from racetracks throughout the United States and other countries, including in New York, New Jersey, Florida, Ohio, Kentucky, and the United Arab Emirates (“UAE”), notwithstanding the detriment and risk of the health and well-being of the racehorses.   Trainers who participated in the schemes stood to profit from the success of racehorses under their control by earning a share of their horses’ winnings, and by improving their horses’ racing records, thereby yielding higher trainer fees and increasing the number of racehorses under their control.  Veterinarians and drug distributors simply profited from the callous sale and administration of these medically unnecessary substances.

The Navarro Indictment

The Navarro Indictment charges 19 individuals representing a cross-section of corruption throughout the Thoroughbred and Standardbred racing industries.  As alleged, JORGE NAVARRO, a racehorse trainer, has participated in the doping of horses under his control using a variety of PEDs, including customized PEDs designed in part to evade normal anti-doping tests administered by racing regulators.  NAVARRO operated his doping scheme covertly, using a straw man to receive certain products designed to mask the presence of PEDs, avoiding explicit discussion of PEDs during certain telephone calls, and working with others to coordinate the administration of PEDs at times that racing officials would not detect such cheating.

NAVARRO trained and doped XY Jet, a thoroughbred horse that won the 2019 Golden Shaheen race in Dubai.  As alleged, NAVARRO was intercepted during telephone conversations discussing his doping practices, and administered PEDs to XY Jet.  Among NAVARRO’s preferred PEDs were various “blood building” drugs, which, when administered before intense physical exertion, can lead to cardiac issues or death.  NAVARRO announced XY Jet’s death, as the result of an apparent heart attack, in January of this year.  Investigation of the circumstances of that death remains ongoing.

NAVARRO was assisted by many of the charged defendants in the Navarro Indictment, and also assisted others, including JASON SERVIS, in obtaining adulterated and misbranded drugs to dope racehorses.

As alleged, SERVIS doped virtually all horses under his control, including Maximum Security, the horse that crossed the finish line first in the 2019 Kentucky Derby before being disqualified for interference.  Among the misbranded and adulterated PEDs used by SERVIS was the drug “SGF-1000,” marketed and sold by defendant MICHAEL KEGLEY JR., among others, and which is compounded and manufactured in unregistered facilities.  SGF-1000, like many other customized PEDs, may cause racehorses to perform beyond their natural abilities, thereby increasing the risk of injuries.  SERVIS and others working with him, including veterinarians KRISTIAN RHEIN and ALEXANDER CHAN, attempted to conceal SERVIS’s doping practices through the use of falsified veterinary bills and fake prescriptions. SERVIS also tipped off NAVARRO to the presence of racing officials searching for signs of illegal doping. NAVARRO expressed his relief regarding SERVIS’ “tip”:  “[The track official] would’ve caught our asses fucking pumping and pumping and fuming every fucking horse [that] runs today.”

The Navarro Indictment also includes charges against veterinarian SETH FISHMAN who also created and shipped adulterated and misbranded drugs. As alleged, SETH FISHMAN, along with LISA GIANNELLI, JORDAN FISHMAN, and others, developed and distributed multiple illegal PEDs.  Those included “blood building” drugs specifically designed to evade anti-doping testing regimes.  On one occasion, SETH FISHMAN touted precisely this deceptive aspect of his illegal PEDs:  “[D]on’t kid yourself: if you’re giving something to a horse to make it better, and you’re not supposed to do that. . . .  That’s doping.  You know, whether or not it’s testable, that’s a different story.”

Finally, the Navarro Indictment includes charges against trainer NICHOLAS SURICK who, among other things, distributed the adulterated and misbranded PED “red acid” (an anti-inflammatory drug) to NAVARRO.  SURICK also obtained and administered other adulterated and misbranded PEDs to horses under his care, including administering the blood building drug Epogen to the racehorse Northern Virgin.  SURICK and others then took extraordinary steps to physically conceal Northern Virgin from New Jersey state regulators seeking to test horses under SURICK’s control, for which SURICK is also charged with obstruction.  

The Grasso Indictment

The Grasso Indictment charges four defendants, including veterinarian LOUIS GRASSO, with conspiring to violate the misbranding laws of the United States.  As alleged, GRASSO manufactured, sold, and distributed adulterated and misbranded PEDs for use on racehorses.  GRASSO also obtained and distributed other PEDs, including snake venom, a type of pain blocking substance.  GRASSO worked with DONATO POLISENO, a Delaware-based distributor of PEDs manufactured by GRASSO and others.  The Grasso Indictment also charges two horse trainers, THOMAS GUIDO III and CONOR FLYNN, with, among other things, causing the shipment of adulterated and misbranded PEDs prior to administering those drugs to horses under their control.  The dangers of that practice are reflected in the death of a horse doped by GUIDO in or about October 2019, about which GRASSO commented:  “I’ve seen that happen 20 times.” 

The Robinson Indictment

SCOTT ROBINSON and SCOTT MANGINI are each charged with misbranding and adulteration conspiracies in the Robinson Indictment.  As alleged, the two defendants previously collaborated in running online marketplaces selling adulterated and misbranded PEDs for racehorses.  The drugs distributed through the defendants’ websites were manufactured in non-FDA registered facilities and carried significant risks to the animals affected through the administration of those illicit PEDs.  In one instance, on January 2, 2016, ROBINSON forwarded a customer complaint to MANGINI:  “I [i.e., a customer contacting ROBINSON] ordered some [PED-1] . . . starting bout 8 hours after I give the injection and for about 36 hours afterwards both my horses act like they are heavily sedated, can barely walk.  Could I have a bad bottle of medicine, I’m afraid to give it anymore since this has happened three times.”  Commenting on this complaint, ROBINSON wrote, “here is another one.”

The Izhaki Indictment

The fourth Indictment unsealed today, the Izhaki Indictment, charges SARAH IZKAHI and ASHLEY LEBOWITZ in connection with their distribution of an adulterated and misbranded blood builder sourced illegally from a Mexico-based pharmaceutical company.  As alleged, IZHAKI has obtained this substance by smuggling the drug into the United States, where IZHAKI and LEBOWITZ distribute the drug to horse trainers in and around the New York City area.

*                *                *

A chart containing the names, charges, and maximum penalties for the defendants in each of the four Indictments is set forth below.  The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge assigned to each case.

Mr. Berman praised the outstanding investigative work of the FBI and the FBI’s Integrity in Sports and Gaming Initiative.  Mr. Berman also thanked the New Jersey Attorney General’s Office, the New York State Police, and the New York City Police Department for their support of this investigation, and Customs and Border Protection, the Food and Drug Administration and Drug Enforcement Administration for their assistance and expertise.

This case is being handled by the Office’s Money Laundering and Transnational Criminal Enterprises Unit.  Assistant United States Attorneys Sarah Mortazavi, Benet J. Kearney, and Andrew C. Adams are in charge of the prosecution.

The charges contained in these Indictments are merely accusations and the defendants are presumed innocent unless and until proven guilty.

The Indictments are posted on our website under the heading "Indictments in Horse Doping Case."

Navarro Indictment

Count

Charge

Defendants

Max. Penalty

Count One

Misbranding Conspiracy

18 U.S.C. § 371

JORGE NAVARRO

ERICA GARCIA

MARCOS ZULUETA

MICHAEL TANNUZZO

GREGORY SKELTON

ROSS COHEN

SETH FISHMAN

CHRISTOPHER OAKES

NICHOLAS SURICK

5 years’ imprisonment.

Count Two

Misbranding Conspiracy

18 U.S.C. § 371

SETH FISHMAN

LISA GIANNELLI

JORDAN FISHMAN

RICK DANE JR.

5 years’ imprisonment.

Count Three

Misbranding Conspiracy

18 U.S.C. § 371

JASON SERVIS

KRISTIAN RHEIN

MICHAEL KEGLEY JR.

ALEXANDER CHAN

HENRY ARGUETA

JORGE NAVARRO

5 years’ imprisonment.

Count Four

Misbranding Conspiracy

18 U.S.C. § 371

NICHOLAS SURICK

REBECCA LINKE

CHRISTOPHER MARINO

5 years’ imprisonment.

Count Five

Obstruction

18 U.S.C. §§ 1512(b)(3) & 2

NICHOLAS SURICK

20 years’ imprisonment.

Count Six

Obstruction

18 U.S.C. §§ 1512(c) & 2

NICHOLAS SURICK

20 years’ imprisonment.

Grasso Indictment

Count

Charge

Defendants

Max. Penalty

Count One

Misbranding Conspiracy

18 U.S.C. § 371

LOUIS GRASSO

DONATO POLISENO

CONOR FLYNN

THOMAS GUIDO III

5 years’ imprisonment.

Robinson Indictment

Count

Charge

Defendants

Max. Penalty

Count One

Misbranding Conspiracy

18 U.S.C. § 371

SCOTT ROBINSON

SCOTT MANGINI

5 years’ imprisonment.

Count Two

Misbranding Conspiracy

18 U.S.C. § 371

SCOTT ROBINSON

5 years’ imprisonment.

Count One

Misbranding Conspiracy

18 U.S.C. § 371

SCOTT MANGINI

5 years’ imprisonment.

Izhaki Indictment

Count

Charge

Defendants

Max. Penalty

Count One

Misbranding Conspiracy

18 U.S.C. § 371

SARAH IZHAKI

ASHLEY LEBOWITZ

5 years’ imprisonment.

Count Two

Smuggling

18 U.S.C. §§ 545 & 2

SARAH IZHAKI

20 years’ imprisonment.

[1] As the introductory phrase signifies, the entirety of the texts of the Indictments and the descriptions of the Indictments set forth herein constitute only allegations and every fact described should be treated as an allegation.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced today that MICHAEL SOLOMON MARKOWITZ, a/k/a “Sol Markowitz,” and DAVID BINET pled guilty to conspiring to steal hundreds of thousands of dollars in advance fees from victims seeking standby letters of credit (“SBLCs”).  BINET pled guilty today, while MARKOWITZ pled guilty on February 26, 2020.  Both defendants pled guilty before U.S. District Judge Paul A. Engelmayer.

U.S. Attorney Geoffrey S. Berman said:  “As they admitted in court, Michael Solomon Markowitz and David Binet perpetrated an advance fee scheme whose victims paid hundreds of thousands of dollars for phantom letters of credit.  Now they both face the very real possibility of being sentenced to prison for their crimes.”

According to the Complaint, the Informations to which MARKOWITZ and BINET pled guilty, and court filings and statements made in public court proceedings:

SBLCs are financial instruments that provide a bank’s commitment to pay a third party in the event that the bank’s client defaults on an agreement with the third party.  An SBLC is a “standby” agreement because the bank will have to pay only in a worst-case scenario where the client defaults on an ongoing agreement.  Fraudulent SBLCs are frequently used in advance-fee schemes so that victims provide funds up front in exchange for the promise of an SBLC.  In reality, and in fact, the victim never receives the SBLC or receives a fake SBLC. 

Since at least 2012 through 2019, MARKOWITZ and BINET engaged in a scheme to defraud victims by inducing them to pay six-figure advance fees in exchange for an SBLC.  MARKOWITZ and BINET purported to be able to help companies and individuals obtain financing for international projects, such as oil and gas projects in Africa.  In fact, MARKOWTIZ and BINET stole the advance fees and never obtained SBLCs.

MARKOWITZ further admitted that he conspired to commit bank fraud by providing fraudulent proof-of-funds letters and SBLCs worth more than $25 million to financial institutions.  On some occasions, MARKOWITZ used fake financial institutions incorporated in Switzerland to provide a veneer of legitimacy for the transactions.

*                *                *

MARKOWITZ, 71, of Brooklyn, New York, pled guilty to one count of conspiracy to commit wire fraud and bank fraud, which carries a maximum sentence of five years in prison.  He is scheduled to be sentenced by Judge Engelmayer on June 8, 2020.

BINET, 62, of New Jersey, pled guilty to one count of conspiracy to commit wire fraud, which carries a maximum sentence of five years in prison.  He is scheduled to be sentenced by Judge Engelmayer on June 15, 2020.

Mr. Berman praised the investigative work of the Federal Bureau of Investigation and the special agents for the United States Attorney’s Office for the Southern District of New York. 

This case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorneys David Abramowicz, Jilan Kamal, and Michael McGinnis are in charge of the prosecution. 

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, and Guido Modano, Special Agent in Charge of the New York Field Office of the Department of Justice Office of the Inspector General (“DOJ OIG”), announced today the unsealing of a Complaint in Manhattan federal court charging corrections officers JERMAINE HARMON, a/k/a “Mel,” KHARI FAISON, a/k/a “Country,” and COMPTON RICHMOND, a/k/a “Rich,” with taking bribes in exchange for smuggling contraband into a private detention facility in Queens, New York, which houses federal inmates pursuant to a contract with the United States Marshals Service (the “Jail”). 

Manhattan U.S. Attorney Geoffrey S. Berman said:  “As alleged, these correction officers abused the power entrusted to them and compromised the safety of the very institution they swore to protect by taking bribes in exchange for smuggling contraband to the inmates in their custody.  We remain committed to rooting out corruption anywhere it takes hold – from the halls of power to the corridors of our correctional facilities.”

DOJ OIG Special Agent in Charge Guido Modano said:  “The public relies on Correctional Officers to maintain order and uphold the law.  Instead, these three Correctional Officers allegedly accepted bribes for smuggling drugs and cell phones into the jail, endangering their fellow Correctional Officers, staff, inmates and the public, and also jeopardizing the security of the jail facility.”

According to the allegations in the Complaint[1] unsealed today in Manhattan federal court:           

HARMON, FAISON, and RICHMOND were all, at relevant times, correction officers at the Jail.  As alleged, HARMON, FAISON, and RICHMOND took bribes from numerous inmates housed at the Jail in exchange for smuggling contraband to those inmates, including marijuana and, in HARMON and FAISON’s case, smokeable synthetic cannabinoids (“K2”).  The bribes were funneled to HARMON, FAISON, and RICHMOND by non-incarcerated friends and relatives of the inmates either in cash or via a cellphone payment application.  For example, on at least four occasions in 2019, HARMON is alleged to have received bribes from an inmate (“Inmate-1”) in exchange for smuggling marijuana and cigarettes into the Jail.  HARMON warned Inmate-1 to “stay low” and “be careful” and offered Inmate-1 marijuana to assault inmates whom HARMON believed to be providing information about him, but Inmate-1 declined.  On multiple occasions in 2019, HARMON took bribes from another inmate (“Inmate-2”) in exchange for smuggling marijuana, K2, and cigarettes into the Jail.  On at least four occasions in 2019, FAISON is alleged to have accepted bribes from two inmates (“Inmate-8” and “Inmate-9”) in exchange for smuggling marijuana, K2, cigarettes, and a cellphone into the Jail.  On at least two occasions in 2019, RICHMOND is alleged to have taken bribes from one of the same inmates who bribed FAISON (Inmate-9) in exchange for smuggling contraband, including marijuana, into the Jail.  As alleged, in most instances, RICHMOND, HARMON, and FAISON obtained the contraband, including marijuana and K2, from non-incarcerated associates of the inmates; those non-incarcerated associates also paid cash bribes, either in person or via mobile applications, to RICHMOND, HARMON, and FAISON.

*                      *                      *

JERMAINE HARMON, 32, of Brooklyn, New York, KHARI FAISON, 26, of Brooklyn, New York, and COMPTON RICHMOND, 24, of Staten Island, New York, each have been charged in the Complaint with one count of conspiracy to commit bribery and to introduce contraband into prison, which carries a maximum prison term of five years, and one count of bribery, which carries a maximum prison term of 15 years.

Mr. Berman praised the investigative work of the DOJ Office of Inspector General in this investigation.

This case is being handled by the Office’s Public Corruption Unit.  Assistant U.S. Attorneys Maurene Comey and Jessica Lonergan are in charge of the prosecution.

The charges contained in the Complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth herein constitute only allegations, and every fact described should be treated as an allegation.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, and Jonathan D. Larsen, the Special Agent in Charge of the New York Field Office of the Internal Revenue Service, Criminal Investigation ("IRS-CI"), announced that ANTONIO NIKC, a Chappaqua businessman, pled guilty to tax evasion for the calendar years 2010 through 2014.  As part of his plea, NIKC agreed to pay $395,745 in restitution to the Internal Revenue Service (“IRS”).  NIKC pled guilty on March 3 before U.S. Magistrate Judge Lisa Margaret Smith. 

U.S. Attorney Geoffrey S. Berman said:  “As he admitted, Antonio Nikc used family businesses to conceal his substantial income and prevent the IRS from calculating his tax due.  While using the business accounts to fund his extravagant lifestyle, Nikc failed to file any personal income tax returns.  Now Nikc awaits sentencing for his crime.”

IRS-CI Special Agent in Charge Jonathan D. Larsen said:  "Our tax system is based on voluntary compliance and we will hold those accountable who fail to report their income out of greed.  IRS-CI special agents will continue to pursue those who take advantage of our tax system."

According to the allegations contained in the Information to which NIKC pled guilty and statements made in court:

From 2010 to 2015, NIKC managed a number of family businesses that operate large rental buildings in New York and Connecticut.  NIKC ran these businesses and managed his personal finances in a manner designed to conceal his sources of income and prevent the IRS from calculating or assessing his tax due.  NIKC treated the business entities’ bank accounts as his own personal bank accounts, using them to pay for more than $1.5 million in personal expenses, including oceanside condominiums in Miami, marina fees for a boat docked in Miami, airline tickets, luxury car payments, college tuition and allowances for his children, and purchases at jewelry stores, clothing stores, and restaurants.

Despite earning and spending a substantial income, NIKC failed to file any personal federal income tax returns and failed to pay any taxes due and owing on the income he received.  NIKC took various affirmative steps to evade the assessment of taxes on that income, including paying for personal expenses out of the family business accounts and intentionally maintaining few assets in his own name.  Through this scheme, NIKC evaded $395,745 in federal income taxes.   

*                *                *

NIKC, 58, of Chappaqua, New York, pled guilty to one count of tax evasion, which carries a maximum sentence of five years in prison.  The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.  NIKC is scheduled to be sentenced by U.S. District Judge Nelson S. Román on June 5, 2020, at 11:00 a.m.

Mr. Berman praised the outstanding work of the Internal Revenue Service, Criminal Investigation, in this case.

This case is being handled by the Office’s White Plains Division.  Assistant U.S. Attorney Jim Ligtenberg is in charge of the prosecution.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced that BARBARA MEYZEN, a/k/a “Bobbie Meyzen,” the owner and operator of La Cremaillere Restaurant in Banksville, New York, pled guilty to wire fraud in connection with her multi-year scheme to defraud the restaurant’s lenders, mortgagee, bankruptcy creditors, and customers.  MEYZEN pled guilty before the Honorable Vincent L. Briccetti in White Plains federal court today.

U.S. Attorney Geoffrey S. Berman said:  “Barbara Meyzen ran a renowned restaurant that served fine French food.  As she admitted today, she also cooked the books and engaged in wholesale fraud, and deceived creditors, the bankruptcy trustee, and FBI agents.  That is a recipe for federal prosecution and a potential prison sentence.”

According to the allegations in the Superseding Information to which MEYZEN pled guilty and other court documents:

MEYZEN has owned and operated the La Cremaillere Restaurant in Banksville, New York, since 1993.  From August 2015 to July 2016, MEYZEN submitted applications for credit on behalf of La Cremaillere to at least nine lenders, factors, and financiers.  In support of those applications, MEYZEN gave the potential lenders La Cremaillere’s bank statements that she had modified to change negative balances to positive balances; to remove references to checks returned for insufficient funds; and to reduce service fees.  For example, MEYZEN modified one month’s statement to change a negative beginning balance of $32,865.57 to a positive beginning balance of $27,766.29; to change from negative to positive the negative ending balance for that month of $5,268.13; and to change service charges of $2,385.60 to $8.00.  When one lender discovered that MEYZEN had altered the bank statements, MEYZEN created an email account in the name of one of the bank’s officers and sent the lender an email in which she, in the guise of the bank officer, told the lender that the statements were genuine.

MEYZEN also falsely represented to the same lender that the second mortgage on the restaurant’s property in Banksville had been discharged.  She created a false satisfaction of mortgage on which she forged the signature of a representative of the restaurant’s second mortgagee, who is MEYZEN’s relative by marriage.  MEYZEN filed the false satisfaction of mortgage with the Westchester County Clerk, paid the Clerk’s filing fee, and sent a copy of the filed satisfaction of mortgage to the lender.  MEYZEN later denied filing the false satisfaction of mortgage or paying the filing fee when she was interviewed by special agents of the FBI.  She told the FBI that she believed a loan broker with whom she had worked in the past, and whom she identified by name, had filed the false satisfaction of mortgage.

Throughout the summer of 2017, MEYZEN charged more than $80,000 in food and restaurant supplies to one of the restaurant’s customers who had left her credit card number on file at the restaurant.  When the customer discovered the charges, MEYZEN claimed the charges were a mistake and repeatedly promised to resolve the problem.  MEYZEN gave the customer two checks in a total amount of $32,000, but the checks bounced.  When she was interviewed by the FBI, MEYZEN denied knowing anything about unauthorized charges to the customer’s credit card or ever speaking with the customer about the unauthorized charges.  MEYZEN also denied giving the customer checks.

Meyzen Family Realty Associates, LLC, which owns the real property from which the restaurant operates, filed for bankruptcy in the U.S. Bankruptcy Court in White Plains in September 2018.  La Cremaillere Restaurant Corp., which operates the restaurant, filed for bankruptcy in April 2019.  MEYZEN is a part owner of both entities.  In May 2019, MEYZEN misled the office of the United States Trustee, which oversees bankruptcy cases, about insurance coverage on the restaurant property.  MEYZEN caused her bankruptcy counsel to give the United States Trustee and an attorney for Meyzen Family Realty’s largest creditor documents indicating that the property was insured when, in fact, the insurance coverage had been canceled months earlier for nonpayment.  MEYZEN knew that the coverage had been canceled because her insurance broker had communicated with her several times about the cancellation of the policies.  In June 2019, MEYZEN falsely testified under oath in a deposition conducted by the United States Trustee that she was not aware that the insurance had been canceled when she caused her attorney to turn the documents over to the United States Trustee. 

Two days after La Cremaillere filed for bankruptcy in April 2019, MEYZEN opened a bank account in her name and diverted more than $40,000 of the restaurant’s credit card receipts to that account.  MEYZEN used a portion of that money to make payments to a food distributor and to an in-home nursing service.  This account was closed on May 1, 2019.  On May 7, 2019, MEYZEN opened an account in the name of Honey Bee Farm, LLC, at another bank and diverted La Cremaillere’s credit card receipts, as well as $20,000 in advances on La Cremaillere’s future credit card revenue, to that account.  MEYZEN used a portion of that money to make a payment on Meyzen Family Realty’s mortgage and to pay food distributors, two wine wholesalers, a commercial trash service, a tableware and china company, and an employee of La Cremaillere.

*                *                *

MEYZEN, 57, of Redding, Connecticut, pled guilty to one count of wire fraud, which carries a maximum sentence of 20 years in prison.  The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of MEYZEN will be determined by a judge.  MEYZEN is scheduled to be sentenced by Judge Briccetti on June 24, 2020.

Mr. Berman praised the outstanding investigative work of the FBI and the Office of Internal Affairs, New York State Department of Taxation and Finance.

The prosecution of this case is being handled by the Office’s White Plains Division.  Assistant United States Attorney James McMahon is in charge of the prosecution.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, Raymond P. Donovan, Special Agent in Charge of the New York Office of the Drug Enforcement Administration (“DEA”), and Dermot Shea, Commissioner of the New York City Police Department (“NYPD”), announced the unsealing today of an Indictment charging EDWARD ABREU, ALICIA ARIAS, LUIS FRIAS, TIMOTHY WALLACE, a/k/a “Larry,” DEREK LIVINGSTON, a/k/a “Wiz,” CHARKEEM PAYNE, a/k/a “Lite,” CAROL LANE, TRACEY SMITH, a/k/a “Trey,” HERMAN STEWARD, TASHA BURNETT, a/k/a “Dutchis,” TYRISS GWYNN, EDGAR MONTES, a/k/a “E,” and FERNANDO DISLA, a/k/a “Lolo,” with participating in a conspiracy to distribute cocaine and crack cocaine.  Eight defendants were taken into custody today and will be presented this afternoon before United States Magistrate Judge Kevin Nathaniel Fox.  Four defendants were previously presented after being taken into custody and one defendant remains at large. The case is assigned to United States District Judge Denise L. Cote.

U.S. Attorney Geoffrey S. Berman said:  “As alleged in the indictment, the defendants in this case brought cocaine and crack into our communities for well over a year.  Thanks to the extraordinary work of the NYPD and DEA, the defendants will now face justice in federal court.”

DEA Special Agent in Charge Ray Donovan said:  “The Gunna Ave gang’s alleged drug trafficking operations encouraged drug abuse and drove crime and violence in the community where they live.  Our partnership with the NYPD and U.S. Attorney’s Office focuses on disrupting drug trafficking organizations at all levels of distribution, as evidenced in this investigation.” 

NYPD Commissioner Dermot Shea said:  “I commend our investigators, together with our federal partners, for the great work throughout this investigation. The men and women of the NYPD work each day to eradicate illegal drugs from our City and ensure safety across every neighborhood.”

As alleged in the Indictment unsealed today in Manhattan federal court[1] and in statements on the record in court: 

EDWARD ABREU, ALICIA ARIAS, LUIS FRIAS, TIMOTHY WALLACE, a/k/a “Larry,” DEREK LIVINGSTON, a/k/a “Wiz,” CHARKEEM PAYNE, a/k/a “Lite,” CAROL LANE, TRACEY SMITH, a/k/a “Trey,” HERMAN STEWARD, TASHA BURNETT, a/k/a “Dutchis,” TYRISS GWYNN, EDGAR MONTES, a/k/a “E,” and FERNANDO DISLA, a/k/a “Lolo,” were members of a drug trafficking organization (the “DTO”) that distributed cocaine and crack cocaine within the Bronx, including in the vicinity of East 167th Street and Sheridan Avenue from at least in or about January 2019 through March 2020.  LIVINGSTON is also charged with having used and possessed a firearm in furtherance of the charged drug trafficking conspiracy and being a felon in possession of a firearm.

*                      *                     *

A chart containing the names, charges, and maximum penalties for the defendants is set forth below.  The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge.

Mr. Berman praised the outstanding investigative work of the DEA and NYPD.

This case is being handled by the Office’s Violent and Organized Crime Unit.  Assistant United States Attorney Thomas John Wright is in charge of the prosecution.

 The charges contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

                                                                                                                                                                                                                    ###

COUNT

CHARGE

DEFENDANTS

MAX. PENALTIES

1

Narcotics conspiracy

21 U.S.C. § 846

EDWARD ABREU, 44,

ALICIA ARIAS, 36,

LUIS FRIAS, 40,

TIMOTHY WALLACE, 32,

a/k/a “Larry,”

DEREK LIVINGSTON, 32,

a/k/a “Wiz,”

CHARKEEM PAYNE, 32,

a/k/a “Lite,”

CAROL LANE, 52, and

TRACEY SMITH, 52,

a/k/a “Trey”

HERMAN STEWARD, 62,

TASHA BURNETT, 44,

a/k/a “Dutchis,”

EDGAR MONTES, 40,

a/k/a “E,” and

FERNANDO DISLA, 33,

a/k/a “Lolo”

TYRISS GWYNN, 34,

Life in prison

Mandatory minimum of 10 years in prison

40 years in prison

Mandatory minimum of 5 years in prison

20 years in prison

2

Using or carrying a firearm during and in relation to, or possessing a firearm in furtherance of, a drug trafficking crime

18 U.S.C. § 924(c)

DEREK LIVINGSTON,

a/k/a “Wiz”

Life in prison

Mandatory minimum of 5 years in prison

3

Felon in possession of a firearm

18 U.S.C. § 922(g)

DEREK LIVINGSTON,

a/k/a “Wiz”

10 years in prison

[1] As the introductory phrase signifies, the entirety of the text of the Indictment and the descriptions of the Indictment constitute only allegations, and every fact described should be treated as an allegation.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, William F. Sweeney Jr., the Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), and Peter C. Fitzhugh, Special Agent in Charge of the New York Office of Homeland Security Investigations (“HSI”), announced today the arrest of HERODE CHANCY and MICHAEL ALBARELLA, who are both employed as managers at a Manhattan branch of a national bank (“Bank-1”), and ADEDAYO ILLORI for engaging in a scheme to fraudulently obtain business loans and to launder the proceeds of that scheme using a bank account opened with a stolen identity.  CHANCY, ALBARELLA, and ILORI were arrested in the New York metropolitan area and are expected to be presented before U.S. Magistrate Judge Kevin Nathaniel Fox in Manhattan federal court.   

U.S. Attorney Geoffrey S. Berman said:  “Bank employees, Herode Chancy and Michael Albarella, and another individual, Adedayo Illori, allegedly engaged in a scheme to use a stolen identity to secure over $1 million in illegal loans.  Furthermore, the defendants allegedly offered the underwriter of the fraudulent loans – who unbeknownst to them was an undercover law enforcement officer – a commission to carry out their scheme.  The defendants stated that they wanted to ‘bust out’ the ill-gotten loans, but ironically find themselves busted for serious federal crimes.”           

FBI Assistant Director William F. Sweeney Jr. said:  “The three subjects in this fraud scheme allegedly thought they could ‘bust out’ of a loan, and steal millions of dollars that wasn’t theirs.  But they got caught, and now they’ll have even more trouble ‘busting out’ of their next destination, a federal prison.  I want to commend the work done by our law enforcement partners and the FBI New York Joint Organized Crime Task Force, who do all they can to protect the public from fraudsters who use insiders to aid and hide their theft.”

HSI Special Agent in Charge Peter C. Fitzhugh said:  “Driven by greed, Chancy and Albarella, allegedly abused their positions as bank officials to perpetrate this loan ‘bust out’ scheme.  By allegedly conspiring with Ilori, the three men were responsible for fraudulently obtaining in excess of $1 million in loans while victimizing the lending institution.  Utilizing the expertise of HSI New York’s El Dorado Financial Crimes Task Force along with our law enforcement partners, this trio was arrested and will have to face criminal charges including money laundering, wire fraud, identity theft and bank bribery.”

As alleged in the Complaint unsealed in Manhattan federal court[1]:

From at least in or about March 2019 up to and including at least in or about March 2020, CHANCY and ILORI conspired to obtain business loans fraudulently from a third-party commercial lender with the intent to “bust out,” that is, not repay, the loans.  CHANCY and ILORI submitted eight fraudulent business loan applications for a total of $1,025,000 in business loans in furtherance of this scam.  The business loan applications submitted by CHANCY and ILORI included doctored bank statements and listed the identities of other persons as the loan applicants.  CHANCY and ILORI also opened bank accounts using the identities of those other persons in order to receive the loan payments from the third-party commercial lender.  CHANCY and ILORI believed that the underwriter for the third-party commercial lender was participating in the scheme and agreed to pay the underwriter a “commission” for the underwriter’s role in the scheme.  In reality, however, the underwriter was an undercover law enforcement officer.

To effect their illegal scheme, CHANCY and ILORI conspired with bank insider ALBARELLA to launder approximately $1 million of the expected proceeds of the loan scheme.  ALBARELLA opened a bank account at Bank-1 using a stolen identity in order to launder the proceeds of the loan scheme, and ALBARELLA accepted a $10,000 bribe in order to open the bank account.    

*                *                *

CHANCY, 40, and ILORI, 42, are charged with: (1) conspiracy to commit wire fraud, (2) wire fraud, (3) aggravated identity theft, and (4) conspiracy to commit money laundering.  ALBARELLA, 34, is charged with: (1) conspiracy to commit money laundering, and (2) bank bribery.  

Wire fraud and conspiracy to commit wire fraud, in violation of 18 U.S.C. §§ 1343 and 1349, carries a maximum of 20 years in prison.  Aggravated identity theft, in violation of 18 U.S.C. § 1028A, carries a mandatory term of two years in prison, to be served consecutively to any other term of imprisonment.  Conspiracy to commit money laundering, in violation of 18 U.S.C. § 1956(h), carries a maximum term of 20 years in prison.  Bank bribery, in violation of 18 U.S.C. § 215, carries a maximum term of 30 years in prison.  The statutory maximum sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by a judge. 

Mr. Berman praised the outstanding investigative work of the FBI and HSI.

This case is being handled by the Office’s Money Laundering and Transnational Criminal Enterprises Unit.  Assistant United States Attorneys Tara M. La Morte and Cecilia E. Vogel are in charge of the prosecution.

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

[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth herein constitute only allegations and every fact described should be treated as an allegation.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced today that COLIN AKPARANTA, a correctional officer at the Metropolitan Correctional Center (“MCC”), which houses federal inmates in Manhattan, pled guilty before United States Magistrate Judge Kevin Nathaniel Fox to one count of abusive sexual contact of an inmate, in violation of Title 18, United States Code, Section 2244(a)(4), and one count of deprivation of the civil rights of that inmate, in violation of Title 18, United States Code, Section 242.  In connection with the plea, AKPARANTA also admitted that he engaged in abusive sexual contact with six additional victims, and engaged in sexual acts with all seven of the victims.  

U.S. Attorney Geoffrey S. Berman said:  “As he has now admitted, Colin Akparanta abused his position of authority as a correctional officer at the MCC to sexually abuse at least seven inmates whose safety and security he was duty-bound to protect.  This Office has prosecuted, and will continue to prosecute, correctional officers who use their positions to engage in criminal conduct, and I encourage anyone with knowledge of this or similar criminal conduct involving correctional officers at the MCC to contact my Office.” 

According to the Indictment, other filings in this case, and statements during court proceedings, including AKPARANTA’s guilty plea hearing:

AKPARANTA has been employed as a correctional officer at the MCC since 2004.

Between in or about late 2012 and in or about April 2018, AKPARANTA used his official position to engage in sexual acts and contact with at least seven female inmates at the MCC while they were under AKPARANTA’s custodial, supervisory, and disciplinary authority.  AKPARANTA digitally penetrated the victims’ vaginas and touched their breasts, buttocks, and/or genitalia.  AKPARANTA also had some of the victims touch his penis over his pants.  In addition, AKPARANTA smuggled contraband, including, but not limited to, personal hygiene items, makeup, and food into the MCC for some of the victims, and, with respect to at least one of the victims, explicitly conditioned his provision of contraband on the inmate’s continued performance of sexual acts with him.  AKPARANTA also asked the victims for their contact information in order to reach them after their release.           

*                *                *

COLIN AKPARANTA, 43, of Irvington, New Jersey, pled guilty to one count of abusive sexual contact, which carries a maximum sentence of two years in prison, and one count of deprivation of civil rights, which carries a maximum sentence of 10 years in prison.  The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.  AKPARANTA is scheduled to be sentenced by the Honorable Lorna G. Schofield on July 8, 2020.   

Any individuals who believe they have information concerning COLIN AKPARANTA or any criminal conduct involving correctional officers at the MCC should contact the United States Attorney’s Office at (866) 874-8900.

Mr. Berman praised the investigative work of the DOJ Office of the Inspector General and the special agents of the United States Attorney’s Office.  

The prosecution is being handled by the Office’s Public Corruption, Violent and Organized Crime, and Civil Rights Units.  Assistant U.S. Attorneys Lara Pomerantz, Sarah Krissoff, and Rachael Doud are in charge of the prosecution.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, and Wendy Woolcock, Special Agent in Charge of the Special Operations Division of the U.S. Drug Enforcement Administration (“DEA”), announced today that GEOVANNY DANIEL FUENTES RAMIREZ was charged in Manhattan federal court with conspiring to import cocaine into the United States and related weapons offenses involving the use and possession of machineguns and destructive devices.  DEA agents arrested FUENTES RAMIREZ on March 1, 2020, at Miami International Airport as he attempted to depart the United States, and was presented yesterday afternoon in Miami federal court.

Manhattan U.S. Attorney Geoffrey S. Berman said:  “As alleged, Geovanny Daniel Fuentes Ramirez was, up until his arrest by the DEA two days ago, a prolific, powerful, and murderous cocaine trafficker in Honduras.  As further alleged, Fuentes Ramirez paved the way for unimpeded shipment of multi-ton loads of cocaine by bribing police and a high-ranking Honduran politician, and reporting directly to Tony Hernandez, another co-conspirator in the scheme and himself a former Honduran congressman.  Thanks to the DEA, a key player in the unholy alliance of Honduran officials and drug traffickers is now in custody and facing a possible life behind bars.”

DEA Special Agent in Charge Wendy Woolcock said:  “The arrest of Geovanny Daniel Fuentes Ramirez is yet another example of DEA’s perseverance to bring to justice criminal associates of corrupt Honduran public officials and law enforcement officers who enabled the trafficking of massive amounts of cocaine headed to the United States.  These corrupt arrangements resulted in horrible violence in Honduras and beyond.  The DEA will continue to aggressively pursue and bring to justice those who participated in these activities, threatened the rule of law, and operated with complete disregard for human life for their financial gain.”

According to the allegations contained in the Complaint[1] charging FUENTES RAMIREZ, evidence presented at the October 2019 trial of Juan Antonio Hernandez Alvarado in the Southern District of New York, and statements in open court during the prosecution of Hernandez Alvarado:

Between approximately 2004 and 2020, multiple drug trafficking organizations in Honduras and elsewhere worked together, and with support from certain prominent public and private individuals, including Honduran politicians and law enforcement officials, to receive multi-ton loads of cocaine sent to Honduras from, among other places, Colombia via air and maritime routes, and to transport the drugs westward in Honduras toward the border with Guatemala and eventually to the United States.  For protection from law enforcement interference, and in order to facilitate the safe passage through Honduras of multi-ton loads of cocaine, FUENTES RAMIREZ and other drug traffickers paid bribes to Honduran public officials, including certain members of the Honduran National Police and the Honduran National Congress.  For example, following an October 2019 trial in the Southern District of New York, former Honduran congressman Juan Antonio Hernandez Alvarado was convicted of drug trafficking, weapons, and false statements charges related to his role in this scheme.  Hernandez Alvarado is scheduled to be sentenced by U.S. District Judge P. Kevin Castel on April 15, 2020.   

Beginning in or about 2009, FUENTES RAMIREZ and others established and operated a cocaine laboratory in the Cortés Department of Honduras, where they produced hundreds of kilograms of cocaine each month.  FUENTES RAMIREZ worked with others to receive cocaine shipments and transport cocaine that he produced, including using planes that landed and departed from a clandestine airstrip that he operated near the Cortés Department.  In order to protect these large quantities of cocaine and his foothold as a large-scale drug trafficker in Honduras, FUENTES RAMIREZ and his workers used firearms, including 9 millimeter handguns, AK-47 assault rifles, and AR-15 assault rifles, and resorted to significant acts of violence, including murder.  In or about 2012, for example, after FUENTES RAMIREZ’s cocaine laboratory was raided by law enforcement, FUENTES RAMIREZ participated in the stabbing murder of a law enforcement official who FUENTES RAMIREZ believed to have been involved in the investigation of the laboratory. 

In or about 2013, FUENTES RAMIREZ paid at least approximately $25,000 to a high-ranking Honduran official referred to in the Complaint as “CC-4,” in exchange for protection from further interventions by law enforcement targeting FUENTES RAMIREZ and his drug trafficking activities.  Around the time of the bribe, during a series of meetings between FUENTES RAMIREZ, CC-4, and others, CC-4 expressed interest in access to FUENTES RAMIREZ’s cocaine laboratory because of its proximity to a major commercial shipping port, agreed to facilitate the use of Honduran armed forces personnel as security for FUENTES RAMIREZ’s drug trafficking activities, and instructed FUENTES RAMIREZ to report directly to Juan Antonio Hernandez Alvarado for subsequent drug trafficking activities.

*                      *                     *

The Complaint charges FUENTES RAMIREZ, 50, with: (1) conspiring to import cocaine into the United States, (2) using and carrying machine guns and destructive devices during and in relation to, and possessing machine guns and destructive devices in furtherance of, the cocaine importation conspiracy; and (3) conspiring to use and carry machine guns and destructive devices during and in relation to, and to possess machine guns and destructive devices in furtherance of, the cocaine importation conspiracy.  If convicted, FUENTES RAMIREZ faces a mandatory minimum sentence of 10 years in prison and a maximum term of life in prison on Count One, a mandatory minimum sentence of 30 years in prison and a maximum term of life in prison on Count Two, a maximum term of life in prison on Count Three. 

Mr. Berman praised the outstanding investigative work of the DEA’s Special Operations Division Bilateral Investigations Unit and Strike Force.

This case is being handled by the Office’s Terrorism and International Narcotics Unit. Assistant U.S. Attorneys Amanda L. Houle, Matthew J. Laroche, Jason A. Richman, and Elinor L. Tarlow are in charge of the prosecution.

The charges in the Complaint are merely accusations, and FUENTES RAMIREZ is presumed innocent unless and until proven guilty.

[1]  As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth herein, constitute only allegations, and every fact described should be treated as an allegation.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced today that CHRISTIAN ERAZO pled guilty in Manhattan federal court to conspiring with others to commit wire fraud and computer intrusion.  As part of that scheme, ERAZO and others obtained unauthorized access to a music producer’s social networking account to impersonate the producer, in order to solicit and obtain unreleased music from other artists.  In addition, ERAZO hacked the online accounts of two music management companies in order to steal unreleased music of numerous music industry professionals.  He pled guilty before U.S. Magistrate Judge Kevin N. Fox.

Manhattan U.S. Attorney Geoffrey S. Berman said:  “As he admitted today, Christian Erazo hacked the accounts of music producers and management companies in order to steal over 50 gigabytes of content, including then-unreleased music, and leaked it on the internet.  This scheme caused financial harm to companies, producers, and artists, and deprived the artists of the ability to release content at their discretion.  Now Erazo must face the music.”

According to the Superseding Indictment and statements made at today’s guilty plea:

From at least in or about late 2016 through at least in or about April 2017, CHRISTIAN ERAZO, the defendant, and others known and unknown, unlawfully obtained unauthorized access to Internet cloud storage service accounts of two music management companies and a music producer (“Producer Victim-1”) by, among other things, using the credentials, or usernames and passwords, of individuals with authorized access to those accounts.  From those accounts, ERAZO and his co-conspirators stole over approximately 50 gigabytes of music, including music that had not yet been publicly released, from over 20 recording artists, as well as usernames and passwords to other online accounts, among other things.  ERAZO and his co-conspirators also leaked on public online forums music that had not yet been publicly released, causing financial and reputational harm to Producer Victim-1 and other recording artists.

In addition, from at least in or about late 2016 through at least in or about late 2017, CHRISTIAN ERAZO, and others known and unknown, unlawfully accessed without authorization a social networking account belonging to Producer Victim-1, from which ERAZO and a co-conspirator (“CC-1”) impersonated Producer Victim-1 and sent private messages to numerous recording artists to solicit music from them that they had not yet released.  ERAZO and CC-1 directed these artists to send their music to a fake email account that ERAZO created that incorporated Producer Victim-1’s professional name, which numerous artists did.

*                      *                     *

ERAZO, 27, of Austin, Texas, pled guilty to one count of conspiracy to commit wire fraud, which carries a maximum sentence of 20 years in prison, and one count of conspiracy to commit computer intrusion, which carries a maximum sentence of five years in prison.  The statutory maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.  ERAZO is scheduled to be sentenced by U.S. District Judge Lorna G. Schofield on July 7, 2020.

Mr. Berman praised the outstanding investigative work of the New York Field Office of Homeland Security Investigations.

The prosecution of this case is being handled by the Office’s Complex Frauds and Cybercrime Unit.  Assistant United States Attorneys Kristy J. Greenberg and Alexandra N. Rothman are in charge of the prosecution.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York,  Patrick Freaney, Deputy Special Agent in Charge of the New York Field Office of the United States Secret Service (“Secret Service”), Troy Miller, Director of New York Field Operations for United States Customs and Border Protection (“CBP”), and William F. Sweeney Jr., Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”),  announced today the arrests of JACOB SAGIAO, MARYLYNN PENEUETA, BRITT JACKSON, JOSHUA FITTEN, DONTAE COTTRELL, ARINZE OBIKA, HERMAN BASS, DAVID URO, and PRINCE UKO for money laundering and wire fraud schemes.  Eight of the defendants were presented before United States Magistrate Judges in three federal judicial districts on February 27 and 28.  UKO will be presented before a United States Magistrate Judge in the Northern District of Georgia later today.  Two other defendants, VICTOR AHAIWE and NDUKWE ANYAOGU, remain at large.

U.S. Attorney Geoffrey S. Berman said:  “As alleged, the defendants conspired to launder the proceeds of online fraud schemes that deceived victims into sending the defendants more than $5 million.  Thanks to the Secret Service and CBP, nine of the defendants are in custody, and all 11 face serious federal charges.”           

Secret Service Deputy Special Agent in Charge Patrick Freaney said:  “The U.S. Secret Service is dedicated to the pursuit and investigation of those responsible for committing cyber-enabled fraud.  The success of this investigation is the result of a collaborative effort between the New York Field Office of the Secret Service and the U.S. Attorney’s Office of the Southern District of New York.  Additionally, I would like to recognize the efforts of the Atlanta Field Office and Los Angeles Field Office of the Secret Service for their invaluable assistance that have made this investigation a success.”

CBP Director of New York Field Operations Troy Miller said:  “This case exemplifies the collaborative law enforcement efforts to combat transnational criminal organizations. U.S. Customs and Border Protection is proud to have collaborated with our fellow law enforcement partners during this investigation leading to today’s arrests.”

FBI Assistant Director William F. Sweeney Jr. said:  “The threat of cyber-enabled fraud has long been publicized, and many people assume they know enough to avoid being victimized by this type of crime.  The truth is, however, fraudsters are often very skilled at targeting their victims and masking their behavior in a way that often goes undetected until it’s too late.  Today’s charges are yet another reminder to the public to exercise due diligence in both personal and professional online settings as we work together to defeat cybercrime worldwide.”

According to the allegations in the two Complaints charging the defendants:

From at least in or about July 2018 up to and including at least in or about November 2019, SAGIAO, PENEUETA, JACKSON, FITTEN, COTTRELL, OBIKA, BASS, URO, AHAIWE, ANYAOGU, and UKO received and laundered the proceeds of three business email compromise schemes, in which the corporate and organizational victims were fraudulently induced to send nearly $5 million to bank accounts controlled by SAGIAO, OBIKA, and others.

From at least in or about June 2019 up to and including the present, JACKSON participated in and received proceeds from an online romance fraud scheme, in which the victim was fraudulently induced to send over $130,000 to JACKSON and others.

In or about October 2018, ANYAOGU participated in and received proceeds from an email compromise scheme, in which a foreign law firm was fraudulently induced to transfer approximately $380,000, intended for another person, to a bank account ANYAOGU controlled.

In or about February 2020, UKO made the false statements to federal law enforcement officers that he had never exchanged text messages with a co-conspirator and that certain transactions were for a textile business rather than to launder the proceeds of criminal activity.

*                *                *

SAGIAO, PENEUETA, JACKSON, FITTEN, COTTRELL, OBIKA, BASS, URO, AHAIWE, and ANYAOGU are charged with: (1) conspiracy to commit bank fraud, and (2) conspiracy to commit money laundering.  AHAIWE is also charged with aggravated identity theft, and JACKSON and ANYAOGU are also charged with wire fraud.  UKO is charged with conspiracy to commit money laundering and making false statements in a matter within the jurisdiction of the executive branch of the Government of the United States.  Conspiracy to commit bank fraud, in violation of 18 U.S.C. § 1349, carries a maximum term of 30 years in prison.  Conspiracy to commit money laundering, in violation of 18 U.S.C. § 1956(h), carries a maximum term of 20 years in prison.  Aggravated identity theft, in violation of 18 U.S.C. § 1028A, carries a mandatory consecutive term of two years in prison.  Wire fraud, in violation of 18 U.S.C. § 1343, carries a maximum term of 20 years in prison.  Making a false statement in a matter within the jurisdiction of the executive branch of the Government of the United States, in violation of 18 U.S.C. § 1001, carries maximum term of five years in prison.  The maximum potential sentences and the mandatory minimum sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants would be determined by the judge. 

Mr. Berman praised the outstanding investigative work of the Secret Service, and, in particular, the Secret Service’s Electronic Crimes Task Force, CBP, the FBI, and special agents of the United States Attorney’s Office for the Southern District of New York.  The prosecution of this case is being handled by the Office’s General Crimes Unit.  Assistant United States Attorneys Jun Xiang and Kevin Mead are in charge of the prosecution.

The charges contained in the Complaints are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

Defendant

Age

Hometown

Charges

JACOB SAGIAO

47

Oxnard, CA

Bank fraud conspiracy; money laundering conspiracy

MARYLYNN PENEUETA

46

Oxnard, CA

Bank fraud conspiracy; money laundering conspiracy

BRITT JACKSON

43

Columbus, GA

Bank fraud conspiracy; money laundering conspiracy; wire fraud

JOSHUA FITTEN

25

Hacienda Heights, CA

Bank fraud conspiracy; money laundering conspiracy

DONTAE COTTRELL

36

Whittier, CA

Bank fraud conspiracy; money laundering conspiracy

ARINZE OBIKA

33

Queens, NY

Bank fraud conspiracy; money laundering conspiracy

NDUKWE ANYAOGU

43

Marietta, GA

Bank fraud conspiracy; money laundering conspiracy; wire fraud

HERMAN BASS

37

Hawthorne, CA

Bank fraud conspiracy; money laundering conspiracy

DAVID URO

28

Brooklyn, NY

Bank fraud conspiracy; money laundering conspiracy

VICTOR AHAIWE

54

Rancho Cucamonga, CA

Bank fraud conspiracy; money laundering conspiracy; aggravated identity theft

PRINCE UKO

46

Jonesboro, GA

Money laundering conspiracy; false statements

As the introductory phrase signifies, the entirety of the text of the Complaints and the descriptions of the Complaints set forth herein constitute only allegations and every fact described should be treated as an allegation.

A Massachusetts-based accountant who was charged along with three others in connection with a decades-long criminal scheme perpetrated by Mossack Fonseca & Co. (Mossack Fonseca), a Panamanian-based global law firm, and its related entities, pleaded guilty today to wire and tax fraud, money laundering, aggravated identity theft and other charges. 

Richard Gaffey, aka “Dick Gaffey,” 75, of Medfield, Massachusetts, pleaded guilty to one count of conspiracy to commit tax evasion and to defraud the United States, one count of wire fraud, one count of money laundering conspiracy, four counts of willful failure to file Reports of Foreign Bank and Financial Accounts (Financial Crimes Enforcement Network Reports 114), and one count of aggravated identity theft.

“This defendant worked with the Mossack Fonseca law firm and exploited his role as an accountant to create fraudulent shell companies and defraud the United States of millions of dollars over decades,” said Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division.  “Today’s guilty plea reflects the Department’s commitment to prosecute financial professionals and other gatekeepers to the U.S. financial system who abuse the public’s trust.”

“Richard Gaffey went to extraordinary lengths to circumvent U.S. tax laws in order to maintain Harald Joachim von der Goltz’s wealth and hide it from the IRS,” said U.S. Attorney Geoffrey S. Berman of the Southern District of New York.  “Using the specialized criminal services of global law firm Mossack Fonseca, Gaffey assisted others in violating U.S. tax laws for decades.”

According to the allegations contained in the indictments , other filings in this case, and statements during court proceedings, including Gaffey’s guilty plea hearing, since at least 2000 through 2018, Gaffey conspired with others to defraud the United States by concealing his clients’ assets and investments, and the income generated by those assets and investments, from the IRS through fraudulent, deceitful, and dishonest means. 

During all relevant times, while acting as an accountant, Gaffey assisted U.S. taxpayers who were required to report and pay income tax on worldwide income, including income and capital gains generated in domestic and foreign bank accounts.  Gaffey helped those U.S. taxpayers evade their tax reporting obligations in a variety of ways, including by hiding the beneficial ownership of his clients’ offshore shell companies and by setting up bank accounts for those shell companies.  These shell companies and bank accounts made and held investments totaling tens of millions of dollars.  For one U.S. taxpayer, Gaffey advised the taxpayer how to covertly repatriate approximately $3 million to the United States by reporting to the IRS a fictitious company sale  to thereby evade paying the full U.S. tax amount.  Gaffey was assisted in this scheme through the use of Mossack Fonseca law firm, including Ramses Owens, a Panamanian lawyer who previously worked at the Mossack Fonseca.

Gaffey was the U.S. accountant for co-defendant Harald Joachim von der Goltz.  From 2000 until 2017, von der Goltz was a U.S. resident and was subject to U.S. tax laws, which required him to report and pay income tax on worldwide income.  In furtherance of von der Goltz’s efforts to conceal his assets and income from the IRS, Gaffey falsely claimed that von der Goltz’s elderly mother was the sole beneficial owner of the shell companies and bank accounts at issue because, at all relevant times, she was a Guatemalan citizen and resident, and – unlike von der Goltz – was not a U.S. taxpayer.  In support of this fraudulent scheme, Gaffey submitted the name, date of birth, government passport number, address, and other means of identification of von der Goltz’s elderly mother to a U.S. bank in Manhattan. 

Gaffey is scheduled to be sentenced by Judge Berman on June 29, 2020.  Von der Goltz, who pleaded guilty on Feb. 18, 2020, is scheduled to be sentenced by Judge Berman on June 24, 2020. 

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

Assistant Attorney General Benczkowski praised the outstanding investigative work of IRS-Criminal Investigation and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, and thanked the Justice Department’s Tax Division and the FBI for their significant assistance in the investigation.  Assistant Attorney General Benczkowski also thanked the Criminal Division’s Office of International Affairs as well as law enforcement partners in France, the United Kingdom and Germany for their assistance in the case.

The Criminal Division’s Money Laundering and Asset Recovery Section (MLARS), working in partnership with the Southern District of New York’s Complex Frauds and Cybercrime Unit and Money Laundering and Transnational Criminal Enterprises Unit are handling this case.  MLARS Trial Attorneys Michael Parker and Parker Tobin, along with Assistant U.S. Attorneys Eun Young Choi and Thane Rehn, are in charge of the prosecution.

The year 2020 marks the 150th anniversary of the Department of Justice.  Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced that JACQUELINE GRAHAM was sentenced today to 132 months in prison in connection with a $38 million fraudulent mortgage debt elimination scheme.  GRAHAM previously was convicted in June 2019 after a two-week trial before U.S. District Judge Nelson S. Román, who also imposed today’s sentence.

Manhattan U.S. Attorney Geoffrey S. Berman said:  “Jacqueline Graham brazenly defrauded vulnerable homeowners during the housing crisis by falsely promising that, for substantial fees, she could make millions of dollars of their mortgage debt disappear.  In reality, she pilfered her victims’ money, leaving them far worse off, and some ended up losing their homes.  Now Graham will spend 11 years in federal prison for preying upon her many victims.”

According to the Indictment in the case, the evidence presented at trial, and statements made in public court filings and proceedings, including GRAHAM’s sentencing hearing:

From at least 2011 to at least 2012, JACQUELINE GRAHAM partnered with Bruce Lewis and John Ruzza in operating the Valhalla, New York-based Terra Foundation, which held itself out as a business that would investigate and eliminate mortgage loans in exchange for fees, soliciting clients who were having difficulties making their mortgage payments.  In fact, however, Terra engaged in a wide-ranging scheme to defraud clients, county clerks’ offices, and banks.

The fraudulent scheme, which was created by GRAHAM and Lewis, involved Terra performing “audits” of clients’ mortgages, sending pseudo-legal paperwork to the banks and/or lenders holding the mortgages, and ultimately filing purported mortgage discharges with the relevant county clerks’ offices.  As a result, anyone doing a title search for one of Terra’s clients would see that the client’s mortgage had been satisfied.  The mortgages had not, however, been discharged, and the mortgages were eventually reinstated, after the clients paid their fees.

In order to effectuate the scheme, GRAHAM, Lewis, and Ruzza involved others, including Rocco Cermele, the director of operations, Paula Guadagno, who filed discharges on behalf of Terra, and Anthony Vigna, a lawyer and CPA who worked in Terra’s offices.  Vigna was formerly an Assistant Corporation Counsel for the City of Yonkers, and a college accounting and law professor, including stints on the faculties of Mercy College, Iona College, SUNY Maritime College, College of Mount St. Vincent, and Westchester Community College.

In total, GRAHAM and her co-conspirators filed over 60 fraudulent discharges in Westchester and Putnam Counties in New York, and in Connecticut.  The fraudulent discharges claimed to discharge mortgages with a total loan principal of nearly $38 million.

*                *                *

In addition to her prison term, GRAHAM, 54, formerly of Antioch, California, and Levittown, Pennsylvania, was sentenced to five years of supervised release and ordered to pay restitution to her victims in the amount of $694,450 and forfeiture of $138,941.86.

Lewis, 67, formerly of Alaska and Washington State, previously was sentenced by Judge Román to seven years in prison, three years of supervised release, and forfeiture of $149,408.

Vigna, 61, of Thornwood, New York, previously was sentenced by Judge Román to one year and one day in prison, three years of supervised release, and $250,500 of restitution.

Ruzza, 49, formerly of Mahopac, New York, previously pled guilty before U.S. District Judge Cathy Seibel to one count of participating in a conspiracy to commit mail fraud, wire fraud, and bank fraud relating to the Terra scheme, as well as one count of participating in a conspiracy to commit wire fraud, two counts of bank fraud, two counts of wire fraud, and one count of obstruction of justice.

Cermele, 57, of Yonkers, New York, and Guadagno, 62, of Verplanck, New York, previously pled guilty to their participation in the scheme.

Mr. Berman praised the outstanding investigative work of the Federal Bureau of Investigation.  Mr. Berman also thanked the Westchester County District Attorney’s Office and the Department of Housing and Urban Development for their assistance in the case.

This case is being handled by the Office’s White Plains Division.  Assistant United States Attorneys David Felton, Michael Maimin, and James McMahon are in charge of the prosecutions.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York and Brian A. Benczkowski, Assistant Attorney General of the Criminal Division of the U.S. Department of Justice, announced today that RICHARD GAFFEY, a/k/a “Dick Gaffey,” pled guilty today before U.S. District Judge Richard M. Berman to wire fraud, tax fraud, money laundering, aggravated identity theft, and other charges.  GAFFEY, a resident of Massachusetts, is charged along with Harald Joachim von der Goltz, Ramses Owens, and Dirk Brauer in connection with a decades-long criminal scheme perpetrated by Mossack Fonseca & Co. (“Mossack Fonseca”), a Panamanian-based global law firm, and its related entities.  Harald Joachim von der Goltz pled guilty to his role in the scheme on February 18, 2020.

Manhattan U.S. Attorney Geoffrey S. Berman said:  “Richard Gaffey went to extraordinary lengths to circumvent U.S. tax laws in order to maintain Harald Joachim von der Goltz’s wealth and hide it from the IRS.  Using the specialized criminal services of global law firm Mossack Fonseca, Gaffey assisted others in violating U.S. tax laws for decades.”

Assistant Attorney General Brian A. Benczkowski said:  “This defendant worked with the Mossack Fonseca law firm and exploited his role as an accountant to create fraudulent shell companies and defraud the United States of millions of dollars over decades.  Today’s guilty plea reflects the Department’s commitment to prosecute financial professionals and other gatekeepers to the U.S. financial system who abuse the public’s trust.”

According to the allegations contained in the Indictments[1], other filings in this case, and statements during court proceedings, including GAFFEY’s guilty plea hearing:

Since at least 2000 through 2018, GAFFEY conspired with others to defraud the United States by concealing his clients’ assets and investments, and the income generated by those assets and investments, from the Internal Revenue Service (“IRS”) through fraudulent, deceitful, and dishonest means.  During all relevant times, GAFFEY assisted U.S. taxpayers who were required to report and pay income tax on worldwide income, including income and capital gains generated in domestic and foreign bank accounts.  GAFFEY helped those U.S. taxpayers evade their tax reporting obligations in a variety of ways, including by hiding the beneficial ownership of his clients’ offshore shell companies and setting up bank accounts for those shell companies.  These shell companies and bank accounts made investments totaling tens of millions of dollars.  For one U.S. taxpayer, GAFFEY advised how to covertly repatriate approximately $3 million to the United States by reporting to the IRS a fictitious company sale that never actually occurred to evade paying the full U.S. tax amount.  GAFFEY was assisted in this scheme through the use of Mossack Fonseca, including Ramses Owens, a Panamanian lawyer who previously worked at Mossack Fonseca.

GAFFEY was the U.S. accountant for Harald Joachim von der Goltz.  From 2000 until 2017, von der Goltz was a U.S. resident and was subject to U.S. tax laws, which required him to report and pay income tax on worldwide income.  In furtherance of von der Goltz’s efforts to conceal his assets and income from the IRS, GAFFEY falsely claimed that von der Goltz’s elderly mother was the sole beneficial owner of the shell companies and bank accounts at issue because, at all relevant times, she was a Guatemalan citizen and resident, and – unlike von der Goltz – was not a U.S. taxpayer.  In support of this fraudulent scheme, GAFFEY submitted the name, date of birth, government passport number, address, and other means of identification of von der Goltz’s elderly mother to a U.S. bank in Manhattan.

*                *                *

GAFFEY, 75, a U.S. citizen and resident of Medfield, Massachusetts, pled guilty to one count of conspiracy to commit tax evasion and to defraud the United States, which carries a maximum sentence of five years in prison; one count of wire fraud, which carries a maximum sentence of 20 years in prison; one count of money laundering conspiracy, which carries a maximum sentence of 20 years in prison; four counts of willful failure to file Reports of Foreign Bank and Financial Accounts, FINCEN Reports 114, each of which carries a maximum sentence of five years in prison; and one count of aggravated identity theft, which carries a mandatory minimum sentence of two years in prison. 

GAFFEY is scheduled to be sentenced by Judge Berman on is June 29, 2020, at 11:00 a.m.  Von der Goltz is scheduled to be sentenced by Judge Berman on June 24, 2020, at 11:00 a.m.

The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentence for the defendant will be determined by the judge.

*                *                *

U.S. Attorney Berman praised the outstanding investigative work of IRS-Criminal Investigation and Homeland Security Investigations, and thanked the Justice Department’s Tax Division and the Federal Bureau of Investigation for their significant assistance in the investigation.  Mr. Berman also thanked the Criminal Division’s Office of International Affairs as well as law enforcement partners in France, the United Kingdom, Panama, and Germany for their assistance in the case.

This case is being handled by the Office’s Complex Frauds and Cybercrime Unit and Money Laundering and Transnational Criminal Enterprises Unit, working in partnership with the Money Laundering and Asset Recovery Section of the Criminal Division.  Assistant United States Attorneys Eun Young Choi and Thane Rehn, along with Trial Attorneys Michael Parker and Parker Tobin of the Money Laundering and Asset Recovery Section, are in charge of the prosecution.

[1] As the introductory phrase signifies, the entirety of the texts of the Indictments and the descriptions of the Indictments set forth herein constitute only allegations as to Owens and Brauer, and every fact described should be treated as an allegation.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced that TERRELL POLK was sentenced today to 35 years in prison in connection with his participation in a crack cocaine conspiracy and related firearms charges.  As the evidence at trial established, POLK committed three shootings of drug rivals in the Bronx, New York during August 2015.  POLK was convicted following a trial before United States District Judge George B. Daniels, who also imposed today’s sentence.    

U.S. Attorney Geoffrey S. Berman said:  “As the jury found, Terrell Polk sold large quantities of crack cocaine and resolved disputes over drug territory with terrifying violence.  As a result of the skill and determination of our law enforcement partners, Polk will now spend several decades behind bars.”

According to the evidence presented during the trial:

Terrell Polk was a member of a violent drug trafficking organization that sold large quantities of crack cocaine in the Highbridge section of the Bronx.  On July 25, 2015, Polk used a .40 caliber pistol to shoot a rival drug dealer at point blank range on University Avenue in the Bronx.  The victim of this shooting suffered a fractured leg. 

Approximately 10 days later, on August 4, 2015, Polk used a shotgun to shoot two victims inside of a store located on Anderson Avenue in the Bronx.  On that occasion, Polk was in a car when he saw one of his victims standing on the sidewalk.  Polk stopped the car, jumped out of the driver’s seat with a shotgun, and chased the victim into a store.  The victim and an innocent bystander in the store barricaded themselves in the back room to hide from Polk.  When Polk was unable to gain access to the room, he fired a shotgun blast through the door, wounding both men.  The first victim sustained shotgun wounds to his leg and hand, and the second victim sustained shotgun wounds to his elbow. 

A few weeks after these shooting incidents, on August 26, 2015, New York City Police Department (“NYPD”) officers stopped a vehicle driven by Polk, and recovered a loaded gun from the back seat.

*                      *                      *

Mr. Berman praised the outstanding investigative work of the Federal Bureau of Investigation and NYPD.

This case is being handled by the Office’s Narcotics Unit.  Assistant United States Attorneys Michael K. Krouse, Nicholas S. Folly, and Max C. Nicholas are in charge of the prosecution.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, William F. Sweeney Jr., the Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), and Dermot Shea, Commissioner of the New York City Police Department (“NYPD”), announced the arrest of ALLAMBERGEN KUDAYBERGENOV, a/k/a “Allambergen Kuday Bergenov,” for allegedly sending over the internet numerous race-related threats of violence and murder to a former employer at a restaurant in New York, New York.  KUDAYBERGENOV is charged in a criminal Complaint, unsealed yesterday, with one count of making interstate threats, one count of using false immigration documents, and one count of aggravated identity theft.  KUDAYBERGENOV was presented yesterday in Manhattan federal court before U.S. Magistrate Judge Sarah L. Cave and detained.

U.S. Attorney Geoffrey S. Berman said:  “The arrest of Allambergen Kudaybergenov makes clear that we will not tolerate threats of violence, especially those directed at individuals based on their race, ethnicity, sexual orientation, or religious beliefs.  Thanks to the work of the FBI-NYPD Joint Terrorism Task Force, the defendant will have to answer for his alleged threatening actions.”

FBI Assistant Director William F. Sweeney Jr. said:  “The alarming messages Kudaybergenov sent to his intended victims explicitly spelled out what his alleged intentions were.  Threatening violence against someone is disturbing in and of itself.  When the language of the threat includes racist and homophobic sentiments, however, this raises the bar – but it won’t be tolerated here.”

Police Commissioner Dermot Shea said:  “There is no place for hate or intolerance in New York City, or anywhere.  I commend the effort of the NYPD investigators and our federal partners whose hard work resulted in this arrest and charges.”

According to the allegations in the Complaint unsealed in Manhattan federal court:[1]

In approximately April 2019, KUDAYBERGENOV used false identity documents, which included stolen personal identifying information belonging to others, as part of his application for employment at a restaurant (the “Victim Business”) in Manhattan.  Soon after KUDAYBERGENOV was hired, he sent a series of communications via a web-based email service to the Victim Business.  In those messages, KUDAYBERGENOV threatened violence against other employees of the Victim Business.  In one such message, KUDAYBERGENOV wrote, in part, that an employee (“Victim-2”) of the Victim Business was a “jjew [sic] waiting for war.”  Following a dispute at the Victim Business, KUDAYBERGENOV ceased working at the Victim Business, but continued sending threatening messages.  In one of those messages, dated December 26, 2019, KUDAYBERGENOV referenced two more employees of the Victim Business (“Victim-1” and “Victim-3”), writing, in part, “Happy new year [Victim-1].  Soon I kill homosexual dog [Victim-3].”  Later, on January 26, 2020, KUDAYBERGENOV sent a message to the Victim Business and referenced two more employees of the Victim Business (“Victim-4” and “Victim-5”), writing, in part, “I was working there in [Victim Business] as a busboy.  I work there with jews Managers named [Victim-4], [Victim-2] and others.  Jew fucking guy (manager) named [Victim-4] asked me do you speak Spanish.  I told him I wanna another holocaust killing 60 million jews like [Victim4]. [ . . . ] As long as these jews like [Victim-4], [Victim-2], and [Victim-5] are alive, they are dangerous.  [Victim-1], we must kill them.”  Additionally, on February 16, 2020, KUDAYBERGENOV sent a message to the Victim Business, writing, in part, “This message is to [Victim-1]  . . .  once upon a day I said that war started from a jew manager named [Victim-3] who created war, I will finish that war.  I will put fire in all [Victim Business] restaurants in Brooklyn in Manhattan.  The era of whites (jews) and negros are long gone.”

*                *                *

KUDAYBERGENOV is charged with one count of making threatening interstate communications and one count of using false immigration identification documents, each of which carries a maximum sentence of five years in prison, and one count of aggravated identity theft, which carries a mandatory sentence of two years in prison, which must be imposed consecutively to any other sentence imposed.  The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.

Mr. Berman praised the outstanding work of the FBI, and the FBI’s New York Joint Terrorism Task Force, which consists principally of agents from the FBI and detectives from the New York City Police Department.

This case is being handled by the Office’s Terrorism and International Narcotics Unit.  Assistant United States Attorney Matthew J.C. Hellman is in charge of the prosecution.

The charges contained in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.

[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth herein constitute only allegations, and every fact described should be treated as an allegation.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, Dermot Shea, the Police Commissioner of the City of New York (“NYPD”), and Peter C. Fitzhugh, the Special Agent in Charge of the New York Office of Homeland Security Investigations (“HSI”), announced that yesterday, RANDY TORRES, a/k/a “Rico,” 38, WALSTON OWEN, a/k/a “Purp,” 36, and CHARLES VENTURA, a/k/a “Gutta,” 27, were convicted of racketeering charges relating to their involvement in the violent Rollin’ 30s Crips street gang.  OWEN and VENTURA were also found guilty of attempted murders in aid of racketeering and related firearms offenses.  The convictions followed a fifteen-day trial before United States District Judge Victor Marrero.

The jury found that TORRES’s involvement in the Rollin’ 30s racketeering conspiracy included the September 19, 2015 murder of Nester Suazo and that OWEN’s involvement included the March 26, 2015 murder of Victor Chafla.  Suazo was killed after Torres and other gang members fought with members of a rival Crip faction at a music video shoot in the Bronx.  Chafla, an innocent bystander, was caught in the crossfire during an attempt by Rollin’ 30s members to shoot at a member of an opposing street gang in the Bronx.  At the time he was shot, Chafla was standing outside the store where he worked stocking fruits and vegetables. Chafla died from his wounds a few days later.

U.S. Attorney Geoffrey S. Berman said:  “As the jury unanimously found, the defendants were members of a violent gang, and were responsible for multiple murders.  Thanks to the dedication of our partners at the NYPD and HSI, the defendants now stand convicted in federal court for their crimes.”

According to the allegations contained in the Superseding Indictments and other documents in the public record, and the evidence at trial:

From at least in or about 2009 up to and including in or about 2017, in the Southern District of New York and elsewhere, RANDY TORRES, a/k/a “Rico,” WALSTON OWEN, a/k/a “Purpose,” CHARLES VENTURA, a/k/a “Gutta,” and others were members or associates of a racketeering enterprise known as the “Rollin’ 30s,” also known as the “Harlem Mafia Crips,” or “Dirt Gang.”  In order to fund the enterprise, protect and expand its interests, and promote its standing, members and associates of the Rollin’ 30s committed, conspired, attempted, and threatened to commit acts of violence, including murder, attempted murder, and robbery; and they conspired to distribute and possess with intent to distribute narcotics.

OWEN and VENTURA each face a mandatory minimum sentence of ten years’ imprisonment; all three defendants face a maximum sentence of life imprisonment.  Sentencing of the defendants has been scheduled for July 10, 2020.

Mr. Berman praised the outstanding investigative work of the NYPD and HSI. 

The case is being handled by the Office’s Violent and Organized Crime Unit. Assistant United States Attorneys Jessica K. Fender, Anden Chow, and Jacqueline C. Kelly are in charge of the prosecution.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced that today SKYLAR DAVIS, a/k/a “S-Dot,” was sentenced to 30 years in prison in connection with his robbery and participation in the murder of Samuel Stubbs, a community member in the City of Newburgh, New York, and DAVIS’s membership in and leadership of “Southside,” a violent street gang that operated in Newburgh.  DAVIS previously pled guilty to racketeering and murder charges before United States District Cathy Seibel, who also imposed today’s sentence.  Besides his gang leadership and his participation in the murder of Samuel Stubbs, DAVIS also committed or helped commit six additional nonfatal shootings of Southside’s gang rivals in Newburgh over an approximately nine-month period in 2015 and 2016.

U.S. Attorney Geoffrey S. Berman said:  “On a summer night in 2015, Southside gang leader Skylar Davis participated in the murder of Samuel Stubbs.  Davis also committed or participated in more than half a dozen other attempted murders over the ensuing year.  Now he will spend many years in federal prison for his reign of violence.”

According to the various Indictments filed in this case, other documents filed, as well as statements made in open court:

From at least 2014 through June 2017, the Southside Gang was a criminal enterprise centered in and around the intersection of South Street and Chambers Street in an area of Newburgh known as the “Southside.”  In order to gain funds for the gang, protect the gang’s territory, and promote the gang’s standing, members of Southside engaged in, among other things, narcotics trafficking, robbery, and acts involving murder.  To that end, Southside members sold heroin, crack cocaine, and marijuana in the gang’s territory, promoted their gang affiliation on social media sites such as Facebook, possessed firearms, and engaged in shootings as part of their gang membership.  Southside members participated in numerous shootings of rival gang members and innocent bystanders, including two murders.

DAVIS was a longtime member of Southside and one of the gang’s leaders.  On August 13, 2015, DAVIS, along with others, decided to rob a high-stakes card game that Stubbs was playing outside, near the intersection of Lander and Courtney Streets in Newburgh.  DAVIS and a co-conspirator approached the three card players with guns drawn and then started firing.  All three men were hit by the ensuing gunfire, and Stubbs, 67, died of his injuries. 

The Stubbs murder was only one of many acts of violence DAVIS participated in as part of his leadership of the Southside gang, including numerous violent crimes after DAVIS participated in Stubbs’s murder.  Beginning in the summer of 2015, Southside engaged in a series of retaliatory shootings with its primary rival gang in Newburgh, the Yellow Tape Money Gang, or “YTMG,” and with other Newburgh gangs allied with YTMG.  DAVIS committed, assisted, and/or caused the following additional Newburgh shootings:

• The attempted murder of rival gang member Gabriel Warren, a/k/a “Stacks,” in the late summer or early fall of 2015;
• The attempted murder of rival gang member Armad Evans, a/k/a “Yellow,” on or about October 5, 2015;
• The attempted murder of rival gang member Tyrin Gayle, a/k/a “Spazzo,” and other YTMG members on or about December 11, 2015;
• The attempted murder of rival YTMG gang members on or about March 17, 2016;
• Aiding and abetting the attempted murder of rival gang member Romeo Herring on or about April 3, 2016; and
• The attempted murder of rival gang members in the vicinity of the 845 Lounge located at 778 Broadway on or about May 21, 2016.

DAVIS bragged about his violence, his drug dealing, and his firearms possession on Facebook, which helped further fuel the violent rivalry between Southside and YTMG. 

DAVIS, 22, of Newburgh, was arrested in June 2017 as a result of a multi-year investigation by the FBI’s Hudson Valley Safe Streets Task Force and the City of Newburgh Police Department into gang violence in Newburgh.  DAVIS was previously serving a lengthy sentence for New York state weapon and controlled substance offenses.  The Hudson Valley Safe Streets Task Force and the City of Newburgh Police Department had previously arrested members of YTMG in 2016; every charged member of YTMG was sentenced by Judge Seibel in 2017 and 2018.

Davis is the thirteenth member of Southside to be sentenced by Judge Seibel.  Judge Seibel has imposed substantial periods of incarceration on each:

Name

Convictions:

Sentence

Skylar Davis

Racketeering Conspiracy

Murder in Furtherance of Drug Trafficking

Murder Through Use of a Firearm

Ardae Hines

Racketeering Conspiracy

Narcotics Conspiracy

180 months

Michael Simmons

Racketeering Conspiracy

Possessing Firearms During and in Relation to Drug Trafficking

111 months

Demetrice McLean

Racketeering Conspiracy

Possessing Firearms During and in Relation to Attempted Murder in Aid of Racketeering

180 months

Christopher Davis

Racketeering Conspiracy

Narcotics Conspiracy

126 months

Diamante Frazier

Narcotics Conspiracy

Brandishing Firearms During and in Relation to Assault with a Deadly Weapon and Attempted Murder in Aid of Racketeering

120 months

Ditavious Williams

Racketeering Conspiracy

Narcotics Conspiracy

121 months

Donte Nugent

Racketeering Conspiracy

Narcotics Conspiracy

108 months

Davante Nugent

Racketeering Conspiracy

Narcotics Conspiracy

60 months

Calvin Lembhard

Discharging Firearm in Furtherance of Attempted Murder in Aid of Racketeering

120 months

Paradise Branch

Racketeering Conspiracy

Narcotics Conspiracy

120 months

William Fennell

Racketeering Conspiracy

Narcotics Conspiracy

Discharging Firearms in Furtherance of Drug Trafficking

240 months

Troy Young

Racketeering Conspiracy

Using a Firearm in Furtherance of Murder in Aid of Racketeering

180 months

*                      *                     *

Mr. Berman praised the outstanding investigative work of the FBI, the Bureau of Alcohol, Firearms, Tobacco, and Explosives, and the City of Newburgh Police Department.  Mr. Berman thanked the Orange County District Attorney’s Office for its invaluable ongoing assistance in the case.  Mr. Berman also thanked the Town of Newburgh Police Department, the New York State Police, the Orange County Sheriff’s Department, the Town of New Windsor Police Department, and the New York Department of Corrections and Community Supervision for their assistance in the case. 

This case is being handled by the Office’s White Plains Division.  Assistant United States Attorneys Jacqueline Kelly, Allison Nichols, Maurene Comey, and Samuel Raymond are in charge of the prosecution.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced today that ALJERMIAH MACK, a/k/a “Nuke,” was sentenced to 204 months in prison in connection with his participation in the Nine Trey Gangsta Bloods (“Nine Trey”) and the distribution of narcotics, including heroin and fentanyl.  MACK was convicted following a three-week jury trial in October 2019 before U.S. District Judge Paul A. Engelmayer, who imposed today’s sentence.

U.S. Attorney Geoffrey S. Berman said:  “Aljermiah Mack was a leader of the Nine Trey Gangsta Bloods, a violent gang that wreaked havoc across New York City.  Now, thanks to the outstanding work of our partners at the NYPD, HSI, and ATF, he will spend the next 17 years in federal prison.”

According to court documents and the evidence presented at the trial of MACK and co-defendant Anthony Ellison:

Nine Trey was a criminal enterprise involved in committing numerous acts of violence, including shootings, robberies, and assaults in and around Manhattan and Brooklyn.  Members and associates of Nine Trey engaged in violence to retaliate against rival gangs, to promote the standing and reputation of Nine Trey, and to protect the gang’s narcotics business.  Members and associates of Nine Trey enriched themselves by committing robberies and selling drugs, such as heroin, fentanyl, furanyl fentanyl, MDMA, dibutylone, and marijuana.

The leadership structure of Nine Trey is divided into two parts:  the Prison Lineup, which consists of incarcerated members, and the Street Lineup, which consists of members who are not incarcerated.  MACK was one of the highest-ranking members of the Street Lineup.

MACK was found guilty after trial of racketeering conspiracy for his participation in the Nine Trey enterprise and conspiracy to distribute and possess with intent to distribute one kilogram and more of mixtures and substances containing heroin.

*                *                *

In addition to the prison term, MACK, 34, of Brooklyn, New York, was sentenced to five years of supervised release.              

Mr. Berman praised the outstanding investigative work of the New York City Police Department, Homeland Security Investigations, and the Bureau of Alcohol, Tobacco, Firearms and Explosives.  Mr. Berman also praised the New York City Department of Correction, Correction Intelligence Bureau, and the Kings County District Attorney’s Office for their assistance in the investigation.

This case is being handled by the Office’s Violent and Organized Crime Unit.  Assistant United States Attorneys Michael Longyear, Jacob Warren, and Jonathan Rebold are in charge of the prosecution.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, William F. Sweeney Jr., the Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), and Dermot Shea, the Commissioner of the New York City Police Department (“NYPD”), announced the unsealing of an Indictment charging OWEN DRAIN, a/k/a “Whiteboy,” a/k/a “Tommy,” with the November 19, 2019, gunpoint kidnapping of a victim in the Bronx.  The case has been assigned to United States District Judge Victor Marrero.  DRAIN was arrested this afternoon, and will be presented today before United States Magistrate Judge Barbara C. Moses.

U.S. Attorney Geoffrey S. Berman said:  “As alleged in the Indictment, the defendant kidnapped a victim in a car at gunpoint.  Thanks to the outstanding work of the FBI and the NYPD, the defendant is now charged in federal court for this extremely serious crime.”

Police Commissioner Dermot Shea said:  “This arrest and indictment reflects the hard work that members of the NYPD engage in each day to hold responsible the small number of individuals committing much of the violence in New York City. I commend the efforts of the NYPD investigators and our law enforcement partners involved in this investigation.”

As alleged in the Indictment unsealed today in Manhattan federal court[1]:

As alleged, on November 19, 2019, OWEN DRAIN kidnapped a victim at gunpoint and zip tied the victim during the course of the kidnapping.

*                *                *

DRAIN, 35, of Yonkers, New York, is charged with kidnapping, which carries a maximum sentence of life imprisonment.  The statutory maximum penalty is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant would be determined by the judge.           

Mr. Berman praised the outstanding investigative work of the NYPD and FBI. 

This case is being handled by the Office’s Violent and Organized Crime Unit.  Assistant United States Attorneys Ni Qian and Michael D. Longyear are in charge of the prosecution.           

The charges contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

[1] As the introductory phrase signifies, the entirety of the text of the Indictment and the description of the Indictment set forth herein constitute only allegations, and every fact described should be treated as an allegation.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced that FRANK MOSS, a/k/a “Jigga,” a Poughkeepsie drug dealer whose fentanyl led to the overdose deaths of two women, was sentenced to almost 22 years in prison, and ARNOLD MELENDEZ, a/k/a “Frankie,” another Poughkeepsie drug dealer whose fentanyl led to the overdose deaths of two men, was sentenced to almost 16 years in prison, following their pleas of guilty to conspiracy to distribute and possess with the intent to distribute fentanyl.  MOSS and MELENDEZ were sentenced on January 29, 2020, by U.S. District Judge Kenneth M. Karas and U.S. District Judge Vincent L. Briccetti, respectively.

According to the allegations in the Information to which MOSS pled guilty, public court filings, and statements made in court:

Beginning in February 2017 – right after being released from prison – MOSS agreed with others to sell fentanyl.  By August 2017, MOSS was selling mixtures of fentanyl with the stamp “Go Time.”  However, he switched to selling fentanyl with the stamp “No Days Off.”  MOSS knew that “No Days Off” contained pure fentanyl, even warning one of his co-conspirators.  One of MOSS’s co-conspirators learned that people – including himself – were overdosing on “No Days Off” and warned MOSS that people were “falling out,” which is a street term for overdosing.  MOSS replied, “That’s what the people want.”

Not having heeded the warning, MOSS continued to sell “No Days Off.”  Two of his customers, Aracelis Batista and Julie Mach, overdosed and died in August 2017 as a result of using MOSS’s fentanyl.  

According to the allegations in the Information to which MELENDEZ pled guilty, public court filings, and statements made in court:

Beginning no later than December 2017 – the month after his most recent release from prison – MELENDEZ began selling fentanyl to customers in Poughkeepsie, New York, some of which he misrepresented to be heroin.  On multiple occasions, MELENDEZ’s customers told MELENDEZ that users of his drugs were overdosing, and MELENDEZ continued to sell fentanyl.  On at least one occasion, one of MELENDEZ’s customers told MELENDEZ, in substance and in part, that “his sh*t was killing people,” and MELENDEZ responded, in substance and in part, that “I don’t give a sh*t, it’s not my problem.”

Several of MELENDEZ’s customers – whether direct customers or customers of others who purchased drugs from MELENDEZ – overdosed on MELENDEZ’s drugs, but survived after the administration of naloxone.  Two indirect customers – that is, customers of others who purchased drugs from MELENDEZ – overdosed and died after taking MELENDEZ’s drugs.

The MELENDEZ and MOSS cases are unrelated.

*                *                *

In addition to his prison term, MOSS was ordered to serve five years of supervised release, and to forfeit $50,000 in criminal proceeds.

In addition to his prison term, MELENDEZ was ordered to serve five years of supervised release, and to forfeit $20,395 in criminal proceeds, as well as his right to a loaded firearm found at the time of his arrest.

Mr. Berman thanked the Drug Enforcement Administration and the Dutchess County Drug Task Force – which consists of the Dutchess County Sheriff’s Office, the City of Beacon Police Department, the Town of East Fishkill Police Department, the City of Poughkeepsie Police Department, the Town of Poughkeepsie Police Department, and the Town of Hyde Park Police Department – for their outstanding work on the investigations.  This case is being handled by the Office’s White Plains Division.  Assistant United States Attorney Michael D. Maimin is in charge of the prosecutions.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, William F. Sweeney Jr., Assistant Director-in-Charge of the New York Division of the Federal Bureau of Investigation (“FBI”), and Thomas Gleason, Commissioner of the Westchester County Police (“WCP”), announced the unsealing of an Indictment yesterday charging five defendants, including former New York City Police Department (“NYPD”) officer JOHN CICERO, with narcotics distribution offenses in and around Westchester County and New York City. 

Three of the defendants, MARCO CASO, ERIC BAKER, and MATHEW MATTEO, a/k/a “Matthew Mateo,” were arrested yesterday and presented in White Plains federal court before United States Magistrate Judge Lisa Margaret Smith.  CICERO has not been arrested and remains at large.  The fifth defendant, IRMA MATERASSO, is in state custody on other charges and will be transferred to federal custody at a later date.  The case has been assigned to United States District Judge Kenneth M. Karas.

U.S. Attorney Geoffrey S. Berman said:  “As alleged, these defendants trafficked large quantities of methamphetamine and GBL – a liquid date-rape drug – throughout Westchester and New York City.  Methamphetamine devastates communities and GBL spreads danger all over the Southern District of New York, which is why the defendants face serious federal charges.”      

FBI Assistant Director William F. Sweeney Jr. said:  “As a former police officer, sworn to protect others, Mr. Cicero has seen firsthand the harm these drugs do to our society which makes the charges announced today even more egregious.  He now faces the same grim reality criminals he once locked up did - a long prison sentence, this time in a federal jail cell.”

Westchester County Police Commissioner Thomas Gleason said:  “We are pleased that our partnership with the FBI and other federal, state and local law enforcement agencies continues to support our efforts to stem the flow of illegal drugs into Westchester County.” 

As alleged in the Indictment unsealed yesterday in White Plains federal court[[1]]:

From at least 2017 through February 2020, MARCO CASO, JOHN CICERO, IRMA MATERASSO, ERIC BAKER, and MATHEW MATTEO, a/k/a “Matthew Mateo,” conspired to distribute 500 grams and more of methamphetamine.  In addition, from at least 2017 through February 2020, MARCO CASO, JOHN CICERO, IRMA MATERASSO, and MATHEW MATTEO, a/k/a “Matthew Mateo,” conspired to distribute gamma-butyrolactone (known as “GBL”), which is a liquid date-rape drug. 

*                *                *

CASO, 48, of New York, New York, CICERO, 38, of Bronxville, New York, MATERASSO, 36, of New Rochelle, New York, BAKER, 37, of Somerset, New Jersey, and MATTEO, 22, of the Bronx, New York, are each charged with conspiring to distribute 500 grams and more of methamphetamine, which carries a mandatory minimum sentence of 10 years in prison and a maximum sentence of life in prison.  CASO, CICERO, MATERASSO, and MATTEO are also charged with conspiring to distribute GBL, which carries a maximum sentence of 20 years in prison.

The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge.

Mr. Berman praised the outstanding investigative work of the FBI Westchester County Safe Streets Task Force and the Westchester County Police Department.  The Westchester County Safe Streets Task Force comprises Special Agents and Task Force Officers from the FBI, U.S. Probation, Bureau of Alcohol, Tobacco, Firearms and Explosives, New York State Police, Westchester County Police Department, Westchester County DA’s Office, NYPD, Yonkers Police Department, Mount Vernon Police Department, Peekskill Police Department, Greenburgh Police Department, and New Rochelle Police Department.  He also thanked the New York State Department of Corrections Office of Special Investigations, Drug Enforcement Administration, and U.S. Customs and Border Protection for their assistance.

This case is being prosecuted by the Office’s White Plains Division.  Assistant U.S. Attorneys David R. Felton and Daniel G. Nessim are in charge of the prosecution.

The charges contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

[1] As the introductory phase signifies, the entirety of the text of the Indictment, and the description of the Imndictment set forth herein, constitute only allegations, and every fact described should be treated as an allegation.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York and Brian A. Benczkowski, Assistant Attorney General of the Criminal Division of the U.S. Department of Justice, announced today that HARALD JOACHIM VON DER GOLTZ, a/k/a “H.J. von der Goltz,” “Johan von der Goltz,” “Jochen von der Goltz,” “Tica,” “Tika,” pled guilty today before U.S. Magistrate Judge Barbara Moses to wire fraud, tax fraud, money laundering, false statements, and other charges.  VON DER GOLTZ, a former U.S. resident and taxpayer, is charged along with Ramses Owens, Dirk Brauer, and Richard Gaffey, a/k/a “Dick Gaffey,” in connection with a decades-long criminal scheme perpetrated by Mossack Fonseca & Co. (“Mossack Fonseca”), a Panamanian-based global law firm, and its related entities. 

Manhattan U.S. Attorney Geoffrey S. Berman said:  “Harald Joachim von der Goltz went to extraordinary lengths to circumvent U.S. tax laws in order to maintain his wealth and hide it from the IRS.  Using the specialized criminal services of global law firm Mossack Fonseca, von der Goltz set up shell companies and off-shore accounts to conceal millions of dollars.  Now, after years of concealment from the United States, von der Goltz has admitted guilt in a U.S. court and awaits sentencing that could result in a term in a U.S. prison.”

AAG Brian A. Benczkowski said:  “Over nearly two decades, von der Goltz conspired to keep his income hidden from U.S. tax authorities and law enforcement.  Today’s guilty plea demonstrates the Department’s steadfast commitment to prosecute taxpayers who use offshore structures to obscure their wealth and evade their tax obligations.”According to the allegations contained in the Indictments[1], other filings in this case, and statements during court proceedings, including VON DER GOLTZ’s guilty plea hearing:

Since at least 2000 through 2017, VON DER GOLTZ conspired with others to conceal his assets and investments, and the income generated by those assets and investments, from the Internal Revenue Service (“IRS”) through fraudulent, deceitful, and dishonest means.  During all relevant times, VON DER GOLTZ was a U.S. resident and was subject to U.S. tax laws, which required him to report and pay income tax on worldwide income, including income and capital gains generated in domestic and foreign bank accounts.  Nevertheless, VON DER GOLTZ evaded his tax reporting obligations by setting up a series of shell companies and bank accounts, and hiding his beneficial ownership of the shell companies and bank accounts from the IRS.  These shell companies and bank accounts made investments totaling tens of millions of dollars.  VON DER GOLTZ was assisted in this scheme through the use of Mossack Fonseca, including Ramses Owens, a Panamanian lawyer who previously worked at Mossack Fonseca, and by Richard Gaffey, a partner at a U.S.-based accounting firm.  Specifically, in furtherance of VON DER GOLTZ’s efforts to conceal his assets and income from the IRS, VON DER GOLTZ engaged the services of Mossack Fonseca, including Owens, to create a sham foundation and shell companies formed under the laws of Panama and the British Virgin Islands to conceal from the IRS and others the ownership by VON DER GOLTZ of accounts established at overseas banks, as well as the income generated in those accounts.  VON DER GOLTZ, Gaffey, and Owens also falsely claimed that VON DER GOLTZ’s elderly mother was the sole beneficial owner of the shell companies and bank accounts at issue because, at all relevant times, she was a Guatemalan citizen and resident, and – unlike VON DER GOLTZ – was not a U.S. taxpayer. 

*                *                *

VON DER GOLTZ, 82, a citizen of Germany and Guatemala who resided in Needham, Massachusetts, and Key Biscayne, Florida, pled guilty to one count of conspiracy to commit tax evasion, which carries a maximum sentence of five years in prison; one count of wire fraud, which carries a maximum sentence of 20 years in prison; one count of money laundering conspiracy, which carries a maximum sentence of 20 years in prison; four counts of willful failure to file Reports of Foreign Bank and Financial Accounts, FINCEN Reports 114, each of which carries a maximum sentence of five years in prison; and two counts of false statements, each of which carries a maximum sentence of five years in prison. 

VON DER GOLTZ is scheduled to appear before Judge Richard M. Berman on February 24, 2020, at 9:30 a.m., at which time it is anticipated Judge Berman will set a sentencing date.

The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentence for the defendant will be determined by the judge.

Gaffey is scheduled to proceed to trial on March 9, 2020, before Judge Berman. 

*                *                *

U.S. Attorney Berman praised the outstanding investigative work of IRS - Criminal Investigation and HSI, and thanked the Justice Department’s Tax Division and the Federal Bureau of Investigation for their significant assistance in the investigation.  Mr. Berman also thanked the Criminal Division’s Office of International Affairs, which provided significant assistance in securing the defendant’s extradition from the United Kingdom.  He also thanked law enforcement partners in France, the United Kingdom, Panama, and Germany for their assistance in the case.

This case is being handled by the Office’s Complex Frauds and Cybercrime Unit and Money Laundering and Transnational Criminal Enterprises Unit, working in partnership with the Money Laundering and Asset Recovery Section of the Criminal Division.  Assistant United States Attorneys Eun Young Choi and Thane Rehn, along with Trial Attorneys Michael Parker and Parker Tobin of the Money Laundering and Asset Recovery Section, are in charge of the prosecution.

The charges as to Owens, Brauer, and Gaffey are merely accusations, and they are presumed innocent unless and until proven guilty.

[1] As the introductory phrase signifies, the entirety of the texts of the Indictments and the descriptions of the Indictments set forth herein constitute only allegations as to Owens, Brauer, and Gaffey, and every fact described should be treated as an allegation.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, Dermot Shea, the Commissioner of the New York City Police Department (“NYPD”), and Peter C. Fitzhugh, the Special Agent-in-Charge of the New York Field Office of Homeland Security Investigations (“HSI”), announced the unsealing of an Indictment charging 18 members of the 59 Brims gang, including the gang’s leaders, with committing various racketeering, narcotics, and firearms offenses, including murder and attempted murder. 

WILLIE EVANS, a/k/a “Mills,” JAMARR SIMMONS, a/k/a “Show Off,” ALBERT SHOULDERS, a/k/a “Bundy,” RANELL SLOAN, a/k/a “Rah,” DARNELL COOPER, a/k/a “Jeez,” JOSE RODRIGUEZ, a/k/a “Meso,” SYLVESTER WINT, a/k/a “Vesta,” YONETTE RESPASS, a/k/a “Yonette Davis,” a/k/a “Star Brim,” MARKELL BOBIAN, a/k/a “Kellz,” TIMOTHY COLEMAN, a/k/a “LA,” TYRONE ERVIN, a/k/a “Shoota,” SEAN GAMBRELL, a/k/a “Kash,” DARON GOODMAN, a/k/a “Handsome,” JAVARIS JENKINS, a/k/a “JayBz,” JERLAINE LITTLE, a/k/a “Noni,” SHAMARE REID, a/k/a “Sha,” MARKQUEL SIMMONS, a/k/a “Shellz,” and TYRIQUE SNOWDEN, a/k/a “Ty,” are members of a racketeering enterprise known as the 59 Brims.

The Indictment charges WILLIE EVANS, the gang’s godfather, or highest-ranking, non-incarcerated member, and JAMARR SIMMONS, the highest-ranking member in the Bronx, with the September 28, 2019, murder of Bradford Mensah, 22, in the vicinity of Crotona Park in the Bronx, New York.  JAMARR SIMMONS and DARON GOODMAN were previously charged with the January 11, 2020, murder of Jason Parris, 36, in the vicinity of East 170th Street and Webster Avenue in the Bronx, New York.  

In addition to EVANS and JAMARR SIMMONS, the Indictment also charges YONETTE RESPASS, the gang’s godmother, or highest-ranking female member, with participating in the racketeering conspiracy and with ordering a slashing.

U.S. Attorney Geoffrey S. Berman said:  “As alleged in the Indictment, the defendants were responsible for brutal acts of violence – murders, attempted murders, a maiming, and robberies – in service of the 59 Brims gang.  Thanks to the extraordinary work of our partners at the NYPD and HSI, the defendants, who include the leaders of the gang, now face federal charges for their crimes.”

NYPD Commissioner Dermot Shea said:  “Targeting and dismantling gangs and crews, and preventing the violence so often associated with their illegal activities, continues to be one of our highest priorities.  By using precision policing we are targeting the small percentage of people responsible for committing much of the violence in New York, and making the safest large city in America even safer.  I’d like to thank our law enforcement partners for their efforts in helping us achieve this goal.”

HSI Special Agent-in-Charge Peter C. Fitzhugh said:  “The list of allegations against those arrested today includes murder, attempted murder, narcotics violations, firearms offenses, and robbery.  The 59 Brims gang acts with no apparent regard for human life and today’s arrests hopefully put an end to their senseless violence.  As law enforcement, we build investigations to identify not only those who carry out monstrous acts, but also to get the leaders in the organization who facilitate the horrific crimes.  Today, due to the great investigative activity in this case, HSI and its partners are happy to announce that those allegedly responsible from the street level to the highest-ranking members of the 59 Brims gang are facing justice, ultimately making the community safer.”

As alleged in the Indictment unsealed today in Manhattan federal court[1]:

On January 11, 2020, DARON GOODMAN and JAMARR SIMMONS shot and killed Jason Parris in the vicinity of 1441 Webster Avenue in the Bronx, and aided and abetted the same.  GOODMAN and SIMMONS killed Parris in part to maintain and increase their positions in the 59 Brims racketeering enterprise operating in the Southern District of New York.

On September 28, 2019, WILLIE EVANS and JAMARR SIMMONS shot and killed Bradford Mensah in the vicinity of Crotona Park in the Bronx, and aided and abetted the same.  EVANS and SIMMONS killed Mensah in part to maintain and increase their positions in the 59 Brims racketeering enterprise operating in the Southern District of New York.

On September 2, 2019, JAVARIS JENKINS shot at a rival gang member in the Bronx, and aided and abetted the same.  JENKINS shot at the rival in part to maintain and increase his position in the 59 Brims racketeering enterprise operating in the Southern District of New York.

On August 28, 2019, TYRIQUE SNOWDEN shot at an individual while attempting to rob the individual of narcotics and narcotics proceeds in the Bronx, and aided and abetted the same.

On August 24, 2019, SYLVESTER WINT and SHAMARE REID shot at rival gang members in the Bronx, and aided and abetted the same.  WINT and REID shot at the rivals in part to maintain and increase their positions in the 59 Brims racketeering enterprise operating in the Southern District of New York.

On August 8, 2019, JAMARR SIMMONS, ALBERT SHOULDERS, SYLVESTER WINT, YONETTE RESPASS, and SHAMARE REID maimed and assaulted an individual with a dangerous weapon, and aided and abetted the same, by slashing the individual in the face.  SIMMONS, SHOULDERS, WINT, RESPASS, and REID slashed the individual in part to maintain and increase their positions in the 59 Brims racketeering enterprise operating in the Southern District of New York.

On August 1, 2019, JAVARIS JENKINS shot at rival gang members in the Bronx, and aided and abetted the same.  JENKINS shot at the rival in part to maintain and increase his position in the 59 Brims racketeering enterprise operating in the Southern District of New York.

On May 21, 2019, JAMARR SIMMONS, TYRONE ERVIN, and SEAN GAMBRELL robbed at gunpoint individuals who were playing a dice game, and shot at the individuals while robbing them, in the vicinity of Davidson Avenue in the Bronx, and aided and abetted the same.  SIMMONS, ERVIN, and GAMBRELL robbed and shot at the individuals in part to maintain and increase their positions in the 59 Brims racketeering enterprise operating in the Southern District of New York.

On March 30, 2019, JAMARR SIMMONS and TIMOTHY COLEMAN stabbed a rival gang member in the Bronx, and aided and abetted the same.  SIMMONS and COLEMAN stabbed the individual in part to maintain and increase their positions in the 59 Brims racketeering enterprise operating in the Southern District of New York.

On December 6, 2018, JERLAINE LITTLE and others pistol-whipped an individual while robbing the individual at gunpoint in the Bronx, and aided and abetted the same.  LITTLE robbed the individual in part to maintain and increase her position in the 59 Brims racketeering enterprise operating in the Southern District of New York.

On November 29, 2018, JAMARR SIMMONS, MARKELL BOBIAN, TYRONE ERVIN, SEAN GAMBRELL, JERLAINE LITTLE, and MARKQUEL SIMMONS pistol-whipped an individual while robbing the individual at gunpoint in the Bronx, and aided and abetted the same.  JAMARR SIMMONS, BOBIAN, ERVIN, GAMBRELL, LITTLE, MARKQUEL SIMMONS robbed the individual in part to maintain and increase their positions in the 59 Brims racketeering enterprise operating in the Southern District of New York.

Between January 2019 and September 2019, SYLVESTER WINT made the unauthorized sale of multiple firearms that had been transported in interstate commerce, including at a location in the Bronx.

*                *                *

EVANS, 28, SHOULDERS, 23, RODRIGUEZ, 26, BOBIAN, 22, ERVIN, 19, GAMBRELL, 22, JENKINS, 22, LITTLE, 28, REID, 18, and MARKQUEL SIMMONS, 23, were arrested today and will be presented before United States Magistrate Judge Barbara Moses.  GOODMAN, 22, JAMARR SIMMONS, 33, and SNOWDEN, 20, were already in federal custody.  COLEMAN, 32, is in New York City custody and will be transferred to federal custody at a later date.  SLOAN, 27, COOPER, 28, and WINT, 21, have not been arrested and remain at large.  RESPASS, 28, has not been arrested at this time.  This case is assigned to United States District Judge George B. Daniels.

Charts containing the names, charges, and maximum penalties for the defendants are set forth below.  The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge.

Mr. Berman praised the outstanding investigative work of the NYPD and HSI.  Mr. Berman also praised the New York City Department of Correction, Correction Intelligence Bureau, and the Bronx County District Attorney’s Office for their assistance in the investigation.

This case is being handled by the Office’s Violent and Organized Crime Unit.  Assistant United States Attorneys Michael D. Longyear, Jacob Warren, and Adam S. Hobson are in charge of the prosecution.           

The charges contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

COUNT

DEFENDANT(S)

MAX. TERM OF IMPRISONMENT

Count One: Conspiracy to Commit Racketeering (18 U.S.C. § 1962(d))

All defendants

Life imprisonment as to all defendants except Respass and Coleman, for whom the maximum term of imprisonment is 20 years

Count Two:  Murder in Aid of Racketeering

(18 U.S.C. §§ 1959(a)(1) and 2)

Jamarr Simmons

Daron Goodman

Death or a Mandatory Minimum Sentence of Life Imprisonment

Count Three: Use of a Firearm to Commit Murder (18 U.S.C. § 924(j)(1))

Jamarr Simmons

Daron Goodman

Death or Life Imprisonment; Mandatory Minimum Sentence of 5 years

Count Four:  Murder in Aid of Racketeering

(18 U.S.C. §§ 1959(a)(1) and 2)

Willie Evans

Jamarr Simmons

Death or a Mandatory Minimum Sentence of Life Imprisonment

Count Five: Use of a Firearm to Commit Murder (18 U.S.C. §§ 924(j)(1) and 2)

Willie Evans

Jamarr Simmons

Death or Life Imprisonment; Mandatory Minimum Sentence of 5 years

Count Six: Attempted Murder and Assault with a Dangerous Weapon in Aid of Racketeering (18 U.S.C. §§ 1959(a)(3), (a)(5), and 2)

Javaris Jenkins

20 years’ imprisonment

Count Seven: Possession of a Firearm in Furtherance of a Crime of Violence, which Firearm was Discharged (18 U.S.C. §§ 924(c)(1)(A)(i), (ii), (iii) and 2)

Javaris Jenkins

Life imprisonment; Mandatory Minimum Sentence of 10 years

Count Eight: Attempted Murder and Assault with a Dangerous Weapon in Aid of Racketeering (18 U.S.C. §§ 1959(a)(3), (a)(5), and 2)

Sylvester Wint

Shamare Reid

20 years’ imprisonment

Count Nine: Possession of a Firearm in Furtherance of a Crime of Violence, which Firearm was Discharged (18 U.S.C. §§ 924(c)(1)(A)(i), (ii), (iii) and 2)

Sylvester Wint

Shamare Reid

Life imprisonment; Mandatory Minimum Sentence of 10 years

Count Ten: Maiming and Assault in Aid of Racketeering (18 U.S.C. §§ 1959(a)(2), (a)(3), and 2)

Jamarr Simmons

Albert Shoulders

Sylvester Wint

Yonette Respass

Shamare Reid

30 years’ imprisonment

Count Eleven: Attempted Murder and Assault with a Dangerous Weapon in Aid of Racketeering (18 U.S.C. §§ 1959(a)(3), (a)(5), and 2)

Javaris Jenkins

20 years’ imprisonment

Count Twelve: Possession of a Firearm in Furtherance of a Crime of Violence, which Firearm was Discharged (18 U.S.C. §§ 924(c)(1)(A)(i), (ii), (iii) and 2)

Javaris Jenkins

Life imprisonment; Mandatory Minimum Sentence of 10 years

Count Thirteen: Attempted Murder and Assault with a Dangerous Weapon in Aid of Racketeering (18 U.S.C. §§ 1959(a)(3), (a)(5), and 2)

Jamarr Simmons

Tyrone Ervin

Sean Gambrell

20 years’ imprisonment

Count Fourteen: Possession of a Firearm in Furtherance of a Crime of Violence, which Firearm was Discharged (18 U.S.C. §§ 924(c)(1)(A)(i), (ii), (iii) and 2)

Jamarr Simmons

Tyrone Ervin

Sean Gambrell

Life imprisonment; Mandatory Minimum Sentence of 10 years

Count Fifteen: Attempted Murder and Assault with a Dangerous Weapon in Aid of Racketeering (18 U.S.C. §§ 1959(a)(3), (a)(5), and 2)

Jamarr Simmons

Timothy Coleman

20 years’ imprisonment

Count Sixteen: Assault with a Dangerous Weapon in Aid of Racketeering (18 U.S.C. §§ 1959(a)(3) and 2)

Jerlaine Little

20 years’ imprisonment

Count Seventeen: Brandishing a Firearm in Furtherance of a Crime of Violence (18 U.S.C. §§ 924(c)(1)(A)(i), (ii) and 2)

Jerlaine Little

Life imprisonment; Mandatory Minimum Sentence of 7 years

Count Eighteen: Assault with a Dangerous Weapon in Aid of Racketeering (18 U.S.C. §§ 1959(a)(3) and 2)

Jamarr Simmons

Markell Bobian

Tyrone Ervin

Sean Gambrell

Jerlaine Little

Markquel Simmons

20 years’ imprisonment

Count Nineteen: Brandishing a Firearm in Furtherance of a Crime of Violence (18 U.S.C. §§ 924(c)(1)(A)(i), (ii), and 2)

Jamarr Simmons

Markell Bobian

Tyrone Ervin

Sean Gambrell

Jerlaine Little

Markquel Simmons

Life imprisonment; Mandatory Minimum Sentence of 7 years

Count Twenty: Conspiracy to Distribute Controlled Substances (21 U.S.C. § 846)

Willie Evans

Jamarr Simmons

Albert Shoulders

Ranell Sloan

Darnell Cooper

Jose Rodriguez

Sylvester Wint

Markell Bobian

Tyrone Ervin

Sean Gambrell

Javaris Jenkins

Jerlaine Little

Shamare Reid

Markquel Simmons

Tyrique Snowden

Life imprisonment; Mandatory Minimum Sentence of 10 years

Count Twenty One: Possession of a Firearm in Furtherance of a Drug Trafficking Crime (18 U.S.C. §§ 924(c)(1)(A)(i) and 2)

Willie Evans

Jamarr Simmons

Albert Shoulders

Ranell Sloan

Darnell Cooper

Jose Rodriguez

Sylvester Wint

Markell Bobian

Tyrone Ervin

Sean Gambrell

Javaris Jenkins

Jerlaine Little

Shamare Reid

Markquel Simmons

Tyrique Snowden

Life Imprisonment; Mandatory Minimum Sentence of 5 years

Count Twenty Two: Firearms Trafficking (18 U.S.C. §§ 922(a)(1)(A) and 2)

Sylvester Wint

5 years’ imprisonment

Count Twenty Three: Attempted Robbery (18 U.S.C. §§ 1951 and 2)

Tyrique Snowden

20 years’ imprisonment

Count Twenty-Four: Possession of a Firearm in Furtherance of a Crime of Violence, which Firearm was Discharged (18 U.S.C. §§ 924(c)(1)(A)(i), (ii), (iii) and 2

Tyrique Snowden

Life Imprisonment; Mandatory Minimum Sentence of 10 years

[1] As the introductory phrase signifies, the entirety of the text of the Indictment and the description of the Indictment set forth herein constitute only allegations, and every fact described should be treated as an allegation.

A former U.S. resident and taxpayer who was charged along with three others in connection with a decades-long criminal scheme perpetrated by Mossack Fonseca & Co. (Mossack Fonseca), a Panamanian-based global law firm, and its related entities, pleaded guilty today to wire and tax fraud, money laundering, false statements and other charges. 

Harald Joachim von der Goltz, aka “H.J von der Goltz,” “Johan von der Goltz,” “Jochen von der Goltz,” “Tica,” and “Tika,” 82, a citizen of Germany and Guatemala who last resided in Needham, Massachusetts, and Key Biscayne, Florida, pleaded guilty to one count of conspiracy to commit tax evasion, one count of wire fraud, one count of money laundering conspiracy, four counts of willful failure to file reports of foreign bank and financial accounts (Financial Crimes Enforcement Network Reports 114) and two counts of false statements. 

“Over nearly two decades, von der Goltz conspired to keep his income hidden from U.S. tax authorities and law enforcement,” said Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division.  “Today’s guilty plea demonstrates the Department’s steadfast commitment to prosecute taxpayers who use offshore structures to obscure their wealth and evade their tax obligations.”

“Harald Joachim von der Goltz went to extraordinary lengths to circumvent U.S. tax laws in order to maintain his wealth and hide it from the IRS,” said U.S. Attorney Geoffrey S. Berman of the Southern District of New York.  “Using the specialized criminal services of global law firm Mossack Fonseca, von der Goltz set up shell companies and off-shore accounts to conceal millions of dollars.  Now, after years of concealment from the United States, von der Goltz has admitted guilt in a U.S. court and awaits sentencing that could result in a term in a U.S. prison.”

According to the allegations contained in the indictments, other filings in this case and statements during court proceedings, including von der Goltz’s guilty plea hearing, since at least 2000 through 2017, von der Goltz conspired with others to conceal his assets and investments, and the income generated by those assets and investments, from the IRS through fraudulent, deceitful and dishonest means. 

During all relevant times, von der Goltz was a U.S. resident and was subject to U.S. tax laws, which required him to report and pay income tax on worldwide income, including income and capital gains generated in domestic and foreign bank accounts.  Nevertheless, von der Goltz evaded his tax reporting obligations by setting up a series of shell companies and bank accounts, and hiding his beneficial ownership of the shell companies and bank accounts from the IRS.  These shell companies and bank accounts made investments totaling tens of millions of dollars.  Von der Goltz was assisted in this scheme through the use of Mossack Fonseca, including Ramses Owens, a Panamanian lawyer who previously worked at the Mossack Fonseca law firm, and by Richard Gaffey, a partner at a U.S.-based accounting firm. 

In furtherance of von der Goltz’s efforts to conceal his assets and income from the IRS, von der Goltz engaged the services of Mossack Fonseca, including Owens, to create a sham foundation and shell companies formed under the laws of Panama and the British Virgin Islands to conceal from the IRS and others the ownership by von der Goltz of accounts established at overseas banks, as well as the income generated in those accounts.  von der Goltz, Gaffey and Owens also falsely claimed that von der Goltz’s elderly mother was the sole beneficial owner of the shell companies and bank accounts at issue because, at all relevant times, she was a Guatemalan citizen and resident, and — unlike von der Goltz — was not a U.S. taxpayer. 

Von der Goltz is scheduled to appear before U.S. District Judge Richard M. Berman on February 24, 2020.

Gaffey is scheduled to proceed to trial on March 9, 2020, before Judge Berman. 

Assistant Attorney General Benczkowski praised the outstanding investigative work of IRS-Criminal Investigation and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, and thanked the Justice Department’s Tax Division and the FBI for their significant assistance in the investigation. The Criminal Division’s Office of International Affairs provided significant assistance in securing the defendant’s extradition from the United Kingdom.  Assistant Attorney General Benczkowski also thanked law enforcement partners in France, the United Kingdom, and Germany for their assistance in the case.

The Criminal Division’s Money Laundering and Asset Recovery Section (MLARS), working in partnership with the Southern District of New York’s Complex Frauds and Cybercrime Unit and Money Laundering and Transnational Criminal Enterprises Unit are handling this case.  MLARS Trial Attorneys Michael Parker and Parker Tobin along with Assistant U.S. Attorneys Eun Young Choi and Thane Rehn are in charge of the prosecution.

As the introductory phrase signifies, the entirety of the texts of the Indictments and the descriptions of the Indictments set forth herein constitute only allegations as to Owens, Brauer, and Gaffey, and every fact described should be treated as an allegation.

Geoffrey S.  Berman, the United States Attorney for the Southern District of New York, and William F. Sweeney Jr., Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), announced that GREG MILLER pled guilty today to participating in a $9 million scheme to defraud providers of “no-fault” insurance plans.  As part of the scheme, MILLER and his co-conspirators billed insurance companies millions of dollars for expensive durable medical equipment that was never provided to patients.  MILLER pled guilty before United States District Court Judge Katherine Polk Failla.     

U.S. Attorney Geoffrey S. Berman said:  “As he admitted in court today, Greg Miller exploited New York’s no-fault auto insurance system by billing millions of dollars for durable medical equipment that was never actually provided to patients, was medically unnecessary, or was far more expensive than the equipment that was provided.  Now Miller awaits sentencing for his crime.”

FBI Assistant Director William F. Sweeney Jr. said:  “When private health care programs are abused, the financial burden is typically passed on to consumers of these programs by way of increased premiums and other means of supporting services provided by the company.  This is in no way a victimless crime, as it translates into very real numbers for those who pay into these health care programs.  Miller’s conduct was just another way to make a quick profit at the expense of others, and this type of behavior can’t be tolerated.” 

As alleged in the Information filed today in Manhattan federal court:

Between 2014 and 2019, GREG MILLER employed other individuals to serve as the nominal owners of at least two durable medical equipment (“DME”) supply companies located in Brooklyn, New York.  MILLER, the true owner and operator of the companies, directed these individuals to submit fraudulent bills to private insurance companies that provided “no-fault” insurance plans.  Under New York State law, a company that insures a vehicle involved in an accident is required to provide reimbursement for certain treatments and services provided to the vehicle occupants, regardless of who was at fault in the accident.  These treatments and services may include DME if the DME is necessary and actually provided.  The bills submitted by MILLER’s companies were fraudulent because, among other things, the bills were for DME that was never provided to patients, for DME that was medically unnecessary, or for expensive DME purportedly provided to patients when the DME in fact provided to patients was inexpensive DME.        

MILLER, 60, pled guilty to one count of conspiring to commit health care fraud and faces a maximum sentence of 10 years in prison.

The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.  As part of his plea, MILLER agreed to forfeit $3,698,010 and to pay at least that amount in restitution.

Mr. Berman praised the outstanding investigative work of FBI’s Healthcare Fraud Task Force.

The prosecution of this case is being handled by the Office’s Complex Frauds and Cybercrime Unit.  Assistant U.S. Attorney Timothy V. Capozzi is in charge of the prosecution.

“Today a unanimous jury found Michael Avenatti guilty of misusing his client’s information in an effort to extort tens of millions of dollars from the athletic apparel company Nike.  While the defendant may have tried to hide behind legal terms and a suit and tie, the jury clearly saw the defendant’s scheme for what it was – an old fashioned shakedown.”

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced that NICHOLAS JOSEPH GENOVESE was sentenced on February 11 in Manhattan federal court to 140 months in federal prison for committing securities fraud.  GENOVESE induced more than $11.2 million in investments in a hedge fund that he founded, Willow Creek Investments LP (“Willow Creek”), by misrepresenting his qualifications and professional background and concealing that he had prior felony convictions for fraud-related crimes.  In February 2018, GENOVESE was charged, arrested, and detained for perpetrating this fraud.  In October 2018, GENOVESE pled guilty to one count of securities fraud before United States District Judge William H. Pauley III, who also imposed the sentence. 

United States Attorney Geoffrey S. Berman said:  “Nicholas Genovese is a recidivist fraudster and con artist who tricked more than ten victims into investing more than $11.2 million dollars into his hedge fund, Willow Creek, based on false claims about his background and credentials.  Genovese brazenly lied to his victims, falsely claiming that he was an heir to a multimillion-dollar fortune, that he had an Ivy League MBA, and that he had served in senior roles at major Wall Street firms.  In reality, Genovese was a repeat offender with nine prior criminal convictions for fraud-related and other crimes.  Genovese now faces more than a decade in prison for defrauding his victims.”

According to the allegations set forth in the Complaint and Indictment filed against GENOVESE in Manhattan federal court, and statements made in public court filings and proceedings including GENOVESE’s sentencing hearing:

In or about 2015, GENOVESE began soliciting individuals to invest in the hedge fund that became Willow Creek, which was based in New York, New York.  In doing so, GENOVESE represented, among other things, that he was part of the Genovese family that had owned the Genovese Drug Store chain in the New York area and was an heir to this family’s fortune from the sale of that business for hundreds of millions of dollars in the late 1990s; that he had graduated from Dartmouth College’s Tuck School of Business; and that he had extensive Wall Street experience.  In particular, GENOVESE claimed that he had been a Goldman Sachs partner and a Bear Sterns portfolio manager before forming Willow Creek.  Based in part on these claims, victims invested $11,211,704 with GENOVESE. 

These representations were false.  GENOVESE is not related to the Genovese family that owned and sold the Genovese Drug Store Chain, did not attend the Tuck School of Business, and had never worked for Goldman Sachs or Bear Stearns.  GENOVESE also did not tell his investors that he had multiple prior felony convictions for fraud-related offenses including forgery, identity theft, and grand larceny.

When investors began to ask for their money back, GENOVESE put them off.  He told one investor that he would only return that investor’s funds after “the stars have aligned,” or else there would be a risk that almost all the money would be lost as a result of the purported impracticalities of unwinding unspecified trading positions.  Records indicate that GENOVESE lost approximately $8 million trading in TD Ameritrade accounts between January 2015 and December 2017.  GENOVESE also used proceeds of his fraud to purchase various luxuries for himself.

*                      *                      *

GENOVESE, 54, was born and raised in Illinois and is a resident of New York, New York.  In addition to his prison term, GENOVESE was sentenced to three years of supervised release and ordered to pay restitution to his victims in the amount of $11,211,704 in addition to forfeiture of the proceeds of his crime. 

Mr. Berman praised the investigative work of the Federal Bureau of Investigation and thanked the New York Regional Office of the United States Securities and Exchange Commission for its assistance.

This case is being handled by the Office’s Securities and Commodities Fraud Task Force.  Assistant United States Attorney Samson Enzer is in charge of the prosecution.  

Geoffrey S. Berman, United States Attorney for the Southern District of New York, Peter C. Fitzhugh, Special Agent in Charge of the New York Field Office of the Department of Homeland Security Investigations (“HSI”), Scott J. Lampert, Special Agent in Charge of the New York Regional Office of the U.S. Department of Health and Human Services, Office of the Inspector General (“HHS-OIG”), and Dennis Rosen, New York State Medicaid Inspector General (“OMIG”), announced the unsealing of a Complaint charging thirteen defendants with participating in a scheme to steal millions of dollars from New York State’s Medicaid program through fraudulent claims related to transportation services.

U.S. Attorney Geoffrey S. Berman said:  “As alleged, these defendants exploited and abused Medicaid, billing millions of dollars for phantom medical transportation services.  Medicaid is intended to provide financial assistance to those in need.  These defendants allegedly treated the Medicaid program that pays for medical transport as an opportunity to steal from Medicaid, which is indirectly stealing from American taxpayers.  Now they face prosecution for their alleged crimes.”

HSI Special Agent in Charge Peter C. Fitzhugh said:  “It is alleged that these individuals schemed to defraud the Medicaid program out of millions of dollars, in turn robbing all those who rely on it for their vital healthcare needs.  More than a dozen were involved in this plan to charge for services not rendered, and HSI working with its law enforcement partners arrested those who sought to make a profit at the expense of those in need and will continue to do so.”

HHS-OIG Special Agent in Charge Scott J. Lampert said:  “Millions of people in New York depend on Medicaid for vital services, and taxpayers across the country pay for that care.  We will continue close cooperation with our State and Federal law enforcement partners to preserve this essential funding.”

NYS Medicaid Inspector General Dennis Rosen said:  “Today’s arrests send an unmistakable message to those who seek personal gain by preying upon vulnerable New Yorkers and exploiting the Medicaid program.  My office will continue to work closely with our federal partners to protect Medicaid recipients, save taxpayer dollars, and hold wrongdoers fully accountable.”

As alleged in the criminal Complaint unsealed today: 

From in or about August 2017 to February 2020, KJ Transportation C Services Inc. (“KJ”) was paid more than $20 million for providing transportation services for Medicaid enrollees in the New York City area.

JORGELINA ABREU GIL, 32, of Yonkers, New York, is the owner of KJ.  Her husband, JULIO ALVARADO, 59, of Yonkers, is a manager at the company.  Beginning in August 2017, KJ began submitting claims to Medicaid for purported medical transportation services for eligible people in the New York area.  From August 2017 to February 2020, KJ submitted more than 100,000 claims related to hundreds of thousands of trips.  However, a large percentage of those claims were fraudulent.  In some instances, the Medicaid recipient was deceased or out of the country when KJ claimed it was transporting that person to medical appointments.  In other instances, the Medicaid recipient had never heard of KJ and had never taken any rides with the company.  In yet other instances, the Medicaid recipient had received unlawful “kickbacks” from defendants in exchange for either giving KJ his/her Medicaid information, or for fraudulently scheduling trips he/she did not take.

In hundreds of instances, defendants called Medicaid’s transportation management company for the New York City area and scheduled trips on behalf of Medicaid enrollees.  On these calls, the defendants tried to schedule reoccurring trips several times per week that would go on for months, allowing them to bill dozens of trips to Medicaid without having to schedule each trip individually.  In other instances, defendants scheduled trips online.  ABREU GIL attested to nearly all of the trips, fraudulently certifying that the trips actually took place when, in fact, most did not.

HECTOR SALAZAR HERRERA, 27, of the Bronx, New York, ZORAIDA GONZALEZ, 44, of Yonkers, New York, YESENIA RODRIGUEZ,  37, of Yonkers, JOSE RIVERA, 26, of the Bronx, FABIAN MORGAN, 39, of the Bronx, VICTORIA PALMA BREA, 32 of the Bronx, CRISTOPHER SANTOS FELIX, 28, of the Bronx, JOHN MANUEL MEJIA, 41, of the Bronx, JOSE JIMENZ HIDALGO, 42, of the Bronx, FRANCISCO SALAZAR, 68, of the Bronx, and NELSON DIAZ, a/k/a “Abdul Alamin,” 56, of the Bronx, acted as “drivers” or “recruiters” of Medicaid enrollees.  As detailed in the Complaint, the defendants variously paid Medicaid enrollees to schedule fraudulent trips, paid unlawful kickbacks to Medicaid enrollees, and fraudulently scheduled trips that never took place.  In exchange for their work, the “drivers” or “recruiters” were paid up to hundreds of thousands of dollars.

*                      *                      *

ABREU GIL, ALVARADO, GONZALEZ, RODRIGUEZ, RIVERA, MORGAN, PALMA BREA, MEJIA, JIMENEZ HIDALGO, SALAZAR, and DIAZ were arrested this morning and will be presented later today before U.S. Magistrate Judge Robert W. Lehrburger in Manhattan federal court.  SANTOS FELIX was already in federal custody on unrelated charges and will be presented at a later date.           

ABREU GIL, ALVARADO, SALAZAR HERRERA, GONZALEZ, RODRIGUEZ, RIVERA, MORGAN, PALMA BREA, SANTOS FELIX, MEJIA, JIMENZ HIDALGO, SALAZAR, and DIAZ are each charged with one count of submitting false claims, in violation of 18 U.S.C. § 287; one count of theft of government funds, in violation of 18 U.S.C. § 641; one count of aggravated identity theft, in violation 18 U.S.C. § 1028A; one count of wire fraud, in violation of 18 U.S.C. § 1343; one count of health care fraud, in violation of 18 U.S.C. § 1347; one count of conspiracy to commit wire fraud and health care fraud, in violation of 18 U.S.C. § 1349; and one count of violating the Anti-Kickback Statute, 42 U.S.C. § 1320a-7b.  In addition, ABREU GIL and ALVARADO are each charged with one count of money laundering, in violation of 18 U.S.C. § 1957.

The crime of submitting false claims carries a maximum sentence of five years in prison. The crimes of theft of government funds, health care fraud, money laundering, and violating the Anti-Kickback Statute each carry a maximum sentence of 10 years in prison. The crime of wire fraud carries a maximum sentence of 20 years in prison.  The crime of aggravated identity theft carries a mandatory two years in prison.  The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by a judge.

On February 14, 2020, law enforcement officers also executed seizure warrants in an effort to recover millions of dollars in fraud proceeds obtained by the defendants.

Mr. Berman praised the outstanding work of HSI, HHS-OIG, and OMIG.  He also thanked the City of Yonkers Police Department, the New York City Police Department, the New York Attorney General’s Medicaid Fraud Control Unit, and United States Customs and Border Protection for their assistance in the case.

This case is being handled by the Office’s General Crimes Unit.  Assistant United States Attorney Kedar S. Bhatia is in charge of the prosecution.

As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth herein are only allegations, and every fact described should be treated as an allegation.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, William F. Sweeney Jr., the Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), and Dermot Shea, the Commissioner of the New York City Police Department (“NYPD”), announced the unsealing today of an Indictment charging two members of the Woodycrime gang (“Woodycrime”) with various racketeering, firearms, and narcotics offenses, including assault with a deadly weapon and attempted murder in aid of racketeering for committing a June 7, 2018, shooting in Nelson Playground in the Bronx, during which two individuals, including a 13-year-old child, were struck by gunfire.

The defendants, MARVIN GAMONEDA, a/k/a “June,” and LUILLY FERNANDEZ, a/k/a “Luigi,” were taken into custody yesterday evening.  They will be presented today before U.S. Magistrate Judge Robert W. Lehrburger.  The case is assigned to U.S. District Judge John G. Koeltl.   

U.S. Attorney Geoffrey S. Berman said:  “As alleged in the indictment, the defendants carried out a shooting in a playground that injured two individuals, including a child.  Thanks to the extraordinary work of the FBI and the NYPD, the defendants now face federal charges for their crimes.”

FBI Assistant Director William F. Sweeney Jr. said:  “As alleged, these men fired off weapons at a playground, and a child was hit, all because they wanted to protect their turf.  It’s not their turf, it’s not their land, they don’t own it, and everything they’re allegedly doing is illegal and potentially deadly.  I want to commend the outstanding work of the New York FBI/NYPD Metro Safe Streets Task Force for the investigation that led to the arrest of these two men, and doing all they can to get alleged criminals who show no respect for anyone’s life out of the communities they’re terrorizing.”

NYPD Police Commissioner Dermot Shea said:  “The NYPD, in close cooperation with our federal partners, is making New Yorkers safer by focusing significant resources on the relatively small percentage of criminals responsible for much of our city’s crime and disorder.  I commend the NYPD officers, federal investigators, and prosecutors whose hard work resulted in these arrests and charges.”

As alleged in the Indictment unsealed today in Manhattan federal court[1]:

Woodycrime was a criminal enterprise involved in committing numerous acts of violence, including attempted murders and assaults, as well as drug dealing in the Bronx.  Members and associates of Woodycrime engaged in violence to retaliate against rival gangs, to preserve and expand the gang’s territory, and to protect the gang’s narcotics business.  Members and associates of Woodycrime enriched themselves by selling drugs, such as crack cocaine, marijuana, oxycodone, and MDMA or “ecstasy.”  

The Indictment charges GAMONEDA and FERNANDEZ in Count One with participating in a racketeering conspiracy.  Counts Two through Four charge the defendants with conspiracy to commit murder, assault with a deadly weapon and attempted murder in aid of racketeering, and a related firearms offense in connection with the Nelson Playground shooting.  Counts Five and Six charge the defendants with narcotics conspiracy and a related firearms offense.  Count Seven charges GAMONEDA with being a felon in possession of ammunition. 

*                      *                     *

Charts containing the names, ages, charges, and maximum penalties for the defendants are set forth below.  The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge.

Mr. Berman praised the outstanding investigative work of the NYPD and the FBI.

This case is being handled by the Office’s Violent and Organized Crime Unit.  Assistant United States Attorneys Karin Portlock and Andrew Chan are in charge of the prosecution.

The charges contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.      

COUNT

CHARGE

DEFENDANTS

MAX. PENALTIES

1

Racketeering conspiracy

18 U.S.C. § 1962(d)

MARVIN GAMONEDA (33)

LUILLY FERNANDEZ (26)

20 years in prison

2

Conspiracy to commit murder in aid of racketeering

18 U.S.C. § 1959

MARVIN GAMONEDA

LUILLY FERNANDEZ

10 years in prison

3

Assault with a deadly weapon and attempted murder in aid of racketeering

18 U.S.C. § 1959

MARVIN GAMONEDA

LUILLY FERNANDEZ

20 years in prison

4

Using and carrying firearms during and in relation to, and possessing firearms in furtherance of, a crime of violence, which firearms were discharged

18 U.S.C. § 924(c)

MARVIN GAMONEDA

LUILLY FERNANDEZ

Life in prison

Mandatory minimum of 10 years in prison

5

Narcotics trafficking conspiracy

21 U.S.C. § 846

MARVIN GAMONEDA

LUILLY FERNANDEZ

5 years in prison

6

Using and carrying firearms during and in relation to, and possessing firearms in furtherance of, a drug trafficking crime

18 U.S.C. § 924(c)

MARVIN GAMONEDA

LUILLY FERNANDEZ

Life in prison

Mandatory minimum of 5 years in prison

7

Possessing ammunition after being convicted of a felony

18 U.S.C. § 922(g)

MARVIN GAMONEDA

10 years in prison

[1] As the introductory phrase signifies, the entirety of the text of the Indictment constitutes only allegations, and every fact described herein should be treated as an allegation.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced that MICHAEL WHITE, a leader of a violent street gang known as the “Young Gunnaz,” was sentenced to 20 years in prison for his participation in the Young Gunnaz, including an attempted murder of three individuals at a subway station on October 28, 2012.  WHITE was convicted of racketeering conspiracy, attempted murder in aid of racketeering, and a firearms offense following a two-week trial in October 2018 before U.S. District Judge Robert W. Sweet.  U.S. District Judge Analisa Torres imposed today’s sentence.

U.S. Attorney Geoffrey S. Berman said:  “Michael White, a gang leader, was responsible for a shooting spree in and around NYCHA’s Mill Brook Houses.  He shot rival gang members in front of a public school, in a community center, and in a subway station.  Today’s sentence recognizes the serious impact of gun violence in our communities.  We will continue to aggressively prosecute all who engage in these senseless acts of violence.”

According to the evidence presented in court during the trial:

From at least in or about 2010 through in or about October 2017, WHITE was a member of the Young Gunnaz set of the YGz based in the Mill Brook Houses.  WHITE was also a member of MBG, also known as “Money Bitches Guns,” a local gang based in the Mill Brook Houses.  As part of his membership in both gangs, WHITE shot seven people.  Specifically, on January 25, 2010, WHITE shot and injured a 16-year-old rival on a street corner in the Mill Brook Houses.  On January 31, 2010, WHITE shot and injured an 18-year-old rival at a baby shower.  Later on January 31, 2010, WHITE shot a rival gang member near a building in the Mill Brook Houses, causing the individual to suffer life threatening injuries.  On February 12, 2010, WHITE shot and injured an 18-year-old rival outside a public school.  On October 28, 2012, WHITE shot and injured three individuals in the Cypress Avenue Subway Station.

*                *                *

Mr. Berman praised the outstanding investigative work of the New York City Police Department.            

The case is being prosecuted by the Office’s Violent and Organized Crime Unit.  Assistant United States Attorneys Alexandra Rothman, Jordan Estes, and Gina Castellano are in charge of the prosecution.            

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced today the guilty plea of VICTOR PHILLIPS for conspiracy to commit bank bribery.  PHILLIPS pled guilty before U.S. Magistrate Judge Robert W. Lehrburger in Manhattan federal court. 

U.S. Attorney Geoffrey S. Berman said:  “As he admitted in court today, banker Victor Phillips conspired to facilitate the laundering of what he believed were the proceeds of criminal activity.  Thanks to the FBI, Phillips now awaits sentencing for his crime.”

According to the allegations in the Indictment, court filings, and statements made during court proceedings:

Between at least June 2019 and September 2019, PHILLIPS, who was employed at an Atlanta-area branch of a national bank (“Bank-1”), opened bank accounts in the names of shell companies and fictitious persons in exchange for a percentage of fraud proceeds that others laundered through those accounts.  PHILLIPS, in exchange for bribe payments, opened one of these laundering accounts at the behest of a codefendant, who plotted to move approximately $2 million in fraud proceeds through PHILLIPS’s corruptly established account.  PHILLIPS, along with his co-conspirators, were ultimately identified and arrested in the course of a money laundering investigation overseen by the Federal Bureau of Investigation’s (“FBI”) New York Money Laundering Investigation Squad.    

PHILLIPS, 39, pled guilty to one count of conspiracy against the United States, which carries a maximum punishment of five years in prison. The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by a judge.  Sentencing is scheduled for June 4, 2020, at 2:00 p.m., before U.S. District Judge William H. Pauley III, to whom the case is assigned.

Mr. Berman praised the outstanding investigative work of the FBI.  

This case is being handled by the Office’s Money Laundering and Transnational Criminal Enterprises Unit.  Assistant United States Attorneys Kiersten A. Fletcher, Jonathan E. Rebold, and Andrew A. Rohrbach are in charge of the prosecution.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced that MARTINS APSKALNS and IGORS PIRINS were sentenced to 108 months and 66 months in prison, respectively, for their leadership roles in a broad scheme that defrauded victims of millions of dollars.  APSKALNS and PIRINS previously pled guilty to conspiracy to commit bank and wire fraud before United States District Judge Jesse M. Furman, who imposed the sentences.  APSKALNS was sentenced on January 31, 2020, and PIRINS was sentenced on February 10, 2020.

U.S. Attorney Geoffrey S. Berman said:  “Martins Apskalns and Igors Pirins were ringleaders in an international conspiracy that victimized people who thought they were buying classic cars on legitimate internet auction and trading sites.  They admitted to bilking millions of dollars from their victims, and now they are both headed to prison for their crimes.”

According to the allegations in the Indictments, other documents filed in federal court, and statements made in public court proceedings:

From at least January 2016 through December 2018, the defendants participated in a fraudulent scheme that most commonly operated as follows:  First, co-conspirators impersonated automotive dealers and collectors and claimed to be selling classic cars on various well-known internet auction and trading websites.  Victims responding to the ads were in fact corresponding with a fraud scheme participant.  After the victims and co-conspirators came to terms on a sale price, including down payment and shipping costs, victims were next directed to purported automotive transportation companies and were told that these companies would accept payment and transport the cars.  These companies were in fact shell corporations established by the conspiracy to help perpetrate the fraud, whose corporate bank accounts were established and controlled by the defendants and co-conspirators, awaiting wired funds from the fraud’s victims.  After victims had wired payment, the defendants and co-conspirators went to the banks to drain the victim’s funds, often starting the same day payment had been transmitted, withdrawing from different bank branches in numerous withdrawals on the same day, and withdrawing in denominations that were varied and often kept to an amount that they believed would prevent the financial institutions from recording and reporting the fraud.  The defendants and other co-conspirators then sent the fraud proceeds outside the United States to Eastern European countries, from where the defendants and many of their co-conspirators originated.  Some of the defendants maintained managerial roles, recruiting co-conspirators to participate and providing directions and victim information to scheme participants once the co-conspirators were inside the United States.  Victims never received the goods they believed they had purchased, and many were unable to recover their money or were left paying loans for cars that were never truly for sale. 

APSKALNS and PIRINS served as managers in this scheme, who, in addition to opening bank accounts of their own that received victim funds, directed and coordinated the activities of cells of co-conspirators in the United States.  APSKALNS and PIRINS continued their criminal activity and management role when they left the United States and returned to Latvia. 

APSKALNS and PIRINS were arrested in Latvia in November 2018.  At the time of their arrest, evidence recovered from APSKALNS revealed that he was continuing to direct co-conspirators until the time of his arrest.  This information led to the arrest of four co-conspirators in the United States as they attempted to flee the United States from John F. Kennedy airport.  APSKALNS and PIRINS were extradited to the United States in December 2018.

*                *                *

In addition to their prison terms, APSKALNS was also sentenced to three years of supervised release, ordered to pay $4,952,172.37 in restitution, and ordered to forfeit $164,900.04.  PIRINS was also sentenced to three years of supervised release, ordered to pay $3,095,000.94 in restitution, and ordered to forfeit $166,251.94.

Mr. Berman praised the investigative work of the Federal Bureau of Investigation, Customs and Border Protection, and the New York City Police Department.

The investigation was conducted in close cooperation with the International Cooperation Department and the Criminal Investigation Department of the Central Criminal Police Department, State Police of Latvia; Prosecutor’s General Office of Latvia, International Cooperation Division; Police Department of Lithuania, Vilnius County Police Headquarters, Crimes Against Property Board; Lithuanian Criminal Police Bureau, International Liaison Board; Prosecutor General’s Office of the Republic of Lithuania; Vilnius Regional Prosecution Office; and the National Bureau of Investigation of Finland.  The Department of Justice’s Criminal Division’s Office of International Affairs also provided significant assistance. 

The prosecution is being handled by the Office’s General Crimes Unit.  Assistant United States Attorneys Matthew Hellman, Emily Johnson, and Daniel Nessim are in charge of the prosecution.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, and Dermot Shea, the Commissioner of the New York City Police Department (“NYPD”), announced today the arrest of TRISTAN ROWE, a/k/a “Angus,” for engaging in a years-long campaign of cyberstalking, harassment, and computer intrusions against multiple New York City residents and a high school.  ROWE was arrested today in Tennessee and presented before a United States Magistrate Judge in U.S. District Court for the Western District of Tennessee.

U.S. Attorney Geoffrey S. Berman said:  “As alleged, Tristan Rowe terrorized a victim from hundreds of miles away by ‘swatting’ – having police respond to a purported emergency at the victim’s residence.  Rowe also allegedly sent disturbing text messages to the victim, threatening to buy an assault rifle, to kill the victim, and to bomb the victim’s school.  Thanks to the NYPD, Rowe is now in custody and facing serious criminal charges.” 

NYPD Commissioner Dermot Shea said:  “These allegations are a reminder of the threats posed by malicious cyber activity.  I commend our NYPD investigators, and federal partners, for remaining vigilant in collaborating to thwart Internet-facilitated crime.”

According to the allegations in the Complaint[1] unsealed yesterday in Manhattan federal court:

From 2015 through 2019, ROWE engaged in a persistent online stalking and harassment campaign that targeted a particular victim (referred to as “Victim-2” in the Complaint), and involved illegally accessing online accounts belonging to Victim-2 and friends and family members of Victim-2, and obtaining unauthorized access to the computer systems of Victim-2’s former high school.

Among other things, ROWE sent threatening text messages to Victim-2, including a text message containing a photograph of a large kitchen knife and text messages that stated, in sum and substance, “You don’t deserve to live.”  ROWE also sent Victim-2 a map with a detailed route mapped out from Tennessee to Victim-2’s home address in the Bronx, New York.

ROWE also subjected Victim-2 and friends and family members of Victim-2 to multiple “swatting” incidents at their homes.  “Swatting” refers to a harassment tactic of deceiving an emergency service into sending a police or emergency service response team to another person’s address.  As a result, on multiple occasions, armed police officers responded to false reports of emergency situations at Victim-2’s home.  ROWE sent text messages to Victim-2 referencing this harassment, including messages  reading, in sum and substance, “u wanna get swatted,” “even better I’ll swat the nypd,” and recognized the safety risks posed by swatting, warning Victim-2 that “your choice u can wind up dead cause the armoured cops will come raid u.”

As part of this harassment campaign, ROWE also compromised the grading system and online educational platform used by Victim-2’s high school.  A search of ROWE’s computer, conducted pursuant to a judicially authorized search warrant, revealed that ROWE possessed student grading information taken from Victim-2’s high school, as well as hundreds of usernames and passwords associated with the high school.

In addition, ROWE conducted a number of computer intrusions of government and private sector websites.  Evidence obtained from ROWE’s computer indicated that he had launched, or was planning to launch, unauthorized intrusions of various websites, including an inmate tracking website used by federal and local law enforcement, a website for a state Department of Motor Vehicles, a police department website, and the website for a hospital in the Bronx, New York.

*                *                *

ROWE is charged with one count of cyberstalking, which carries a maximum sentence of five years in prison, and one count of unauthorized access to a computer, which carries a maximum sentence of five years.  The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.

Mr. Berman praised the outstanding investigative work of the NYPD in this case.

The case is being prosecuted by the Office’s Complex Frauds and Cybercrime Unit.  Assistant U.S. Attorney Dina McLeod is in charge of the prosecution.

The charges contained in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.

[1] As the introductory phase signifies, the entirety of the text of the Complaint, and the description of the Complaint set forth herein, constitute only allegations, and every fact described should be treated as an allegation.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced today the guilty pleas of all seven defendants previously charged with defrauding the federal “E-Rate” program, designed to provide information technology to underprivileged schools, in connection with private religious schools in Rockland County, New York.  PERETZ KLEIN, SUSAN KLEIN, SIMON GOLDBRENER, MOSHE SCHWARTZ, BEN KLEIN, SHOLEM STEINBERG, and ARON MELBER, each pled guilty in White Plains federal court to one count of conspiring against the United States.

Manhattan U.S. Attorney Geoffrey S. Berman said:  “Each of these defendants has now admitted his or her role in a massive scheme that stole millions of dollars from the E-Rate program.  That money should have been spent to help educate underprivileged children.  Instead, it went to line the defendants’ pockets.  Now they will answer for their crimes.”

According to the allegations made in the Indictment and the Informations to which the defendants pled guilty, as well as the defendants’ admissions in court:

The E-Rate program distributes funds to schools and libraries mostly serving economically disadvantaged children, so that those institutions can afford needed telecommunication services, internet access, and related equipment.  Over 30,000 applications from schools and libraries seeking funds to serve economically disadvantaged children were received each year during the relevant time period; every year, requests for E-Rate funds have exceeded funds available.  In order to obtain those funds, educational institutions certify that they are purchasing equipment and services from a private vendor; if approved, the program defrays the cost by up to 90%.  The educational institution is supposed to enter into an open bidding process in order to select a vendor, and the educational institution and vendor submit a series of certifications that they comply with a number of requirements of the E-Rate program.  A school applying for E-Rate funds may employ a consultant, but that consultant must be independent of the vendors competing to sell E-Rate funded equipment and services.

The schools at issue in this case never received millions of dollars’ worth of these items and services for which the defendants billed the E-Rate program.  In other cases, the schools and the defendants requested hundreds of thousands of dollars of sophisticated technology that served no real purpose for the student population.  For example, from 2009 through 2015, one day care center that served toddlers from the ages of 2 through 4 requested over $700,000 – nearly $500,000 of which was ultimately funded – for equipment and services – including video conferencing and distance learning, a “media master system,” sophisticated telecommunications systems supporting at least 23 lines, and high-speed internet – from companies controlled by certain defendants.  In still other instances, the schools received equipment and services that fulfilled the functions for which the schools had requested E-Rate funds (such as providing the school with internet access), but the schools and the defendants materially overbilled the E-Rate program for the items provided, in order to enrich themselves at the expense of the underprivileged children the program was designed to serve.

The defendants also perverted the fair and open bidding process required by the E‑Rate program.  Defendants who held themselves out as independent consultants working for the schools in truth worked for and were paid by other defendants who controlled vendor companies.  These defendants presented the schools with forms to sign or certify, awarding E-Rate funded contracts to companies owned by several defendants.  As a result of false and misleading filings, the defendants received millions of dollars in E-Rate funds for equipment and services that they did not in fact provide and which the schools did not use, and the defendants purporting to act as consultants accepted payments totaling hundreds of thousands of dollars from the vendors, despite falsely presenting themselves as independent of the vendors.

In return for their participation in the scheme to defraud the E‑Rate program, certain schools and school officials received a variety of improper benefits from certain defendants , including: a percentage of the funds fraudulently obtained from E-Rate for equipment and services that were not in fact provided to the schools; free items paid for with E-Rate funds but not authorized by the program, such as cellphones for school employees’ personal use and alarm systems and security equipment (which the E-Rate program does not authorize) installed at the schools; and free services for which the E-Rate program authorizes partial reimbursement (such as internet access) but for which the Schools did not – contrary to their statements in filings – make any payment at all.

PERETZ KLEIN, SUSAN KLEIN, BEN KLEIN, and SHOLEM STEINBERG held themselves out as vendors to schools participating in the E‑Rate program.  Corporations controlled by these defendants requested over $35 million in E‑Rate funds, and received over $14 million in E‑Rate funds, from in or about 2010 to in or about 2016.  Each of these defendants has now admitted that the companies they controlled did not in fact provide much of the equipment for which they billed the federal government.

SIMON GOLDBRENER and MOSHE SCHWARTZ held themselves out as consultants who worked for educational institutions, supposedly helping schools to participate in the E-Rate program by, among other things, holding a fair and open bidding process to select cost-effective vendors.  GOLDBRENER and SCHWARTZ have now admitted that they were in fact paid hundreds of thousands of dollars by the vendors to complete and file false E-Rate documents that circumvented the bidding process and resulted in the payment of millions of dollars to the vendors.

ARON MELBER was an official at a private religious school in Rockland County, New York, that participated in the E-Rate program with some of the defendants.  MELBER has now admitted that he filed false certifications with the E-Rate program, falsely claiming to have obtained authorized E‑Rate funded equipment and services from vendors selected through a fair and open bidding process.

Each defendant pled guilty to one count of a conspiracy to commit wire fraud, in violation of Title 18, United States Code, Section 371, which carries a maximum sentence of five years in prison and a $250,000 fine.  The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as the sentence for each defendant will be determined by United States District Judge Kenneth M. Karas, to whom the case is assigned.

*                *                *

PERETZ KLEIN, 66, of Spring Valley, New York, pled guilty today before United States Magistrate Judge Judith McCarthy.  As part of his plea agreement, PERETZ KLEIN also agreed to forfeit $1,144,288.37, and to pay restitution of the same amount.  PERETZ KLEIN is scheduled to be sentenced by Judge Karas on June 17, 2020.

SUSAN KLEIN, 59, of Spring Valley, New York, also pled guilty today before Judge McCarthy.  As part of her plea agreement, SUSAN KLEIN also agreed to forfeit $1,144,288.37, and to pay restitution of the same amount.  SUSAN KLEIN is scheduled to be sentenced by Judge Karas on June 17, 2020.

SIMON GOLDBRENER, 57, of Monsey, New York, pled guilty on February 3, 2020, before United States Magistrate Judge Paul E. Davison.  As part of his plea agreement, GOLDBRENER also agreed to forfeit $479,357.18, and to pay restitution of the same amount.  GOLDBRENER is scheduled to be sentenced by Judge Karas on June 8, 2020.

MOSHE SCHWARTZ, 46, of Monsey, New York, pled guilty on February 6, 2020, before Judge Davison.  As part of his plea agreement, SCHWARTZ also agreed to forfeit $275,160.00, and to pay restitution of the same amount.  SCHWARTZ is scheduled to be sentenced by Judge Karas on June 8, 2020.

BEN KLEIN, 41, of Monsey, New York, pled guilty on January 24, 2020, before United States Magistrate Judge Lisa Margaret Smith.  As part of his plea agreement, BEN KLEIN also agreed to forfeit $412,586.37, and to pay restitution of the same amount.  BEN KLEIN is scheduled to be sentenced by Judge Karas on May 22, 2020.

SHOLEM STEINBERG, 41, of Monsey, New York, pled guilty on January 30, 2020, before Judge McCarthy.  As part of his plea agreement, STEINBERG also agreed to forfeit $191,423.50, and to pay restitution of the same amount.  STEINBERG is scheduled to be sentenced by Judge Karas on May 12, 2020.

ARON MELBER, 44, of Monsey, New York, pled guilty on January 30, 2020, before Judge McCarthy.  As part of his plea agreement, STEINBERG also agreed to forfeit $127,654.55, and to pay restitution of the same amount.  STEINBERG is scheduled to be sentenced by Judge Karas on May 8, 2020.

Mr. Berman thanked the Federal Bureau of Investigation, the Federal Communications Commission - Office of the Inspector General, and the Rockland County District Attorney’s Office for their outstanding work on the investigation.  This case is being handled by the Office’s White Plains Division.  Assistant United States Attorneys Michael D. Maimin, Hagan Scotten, and Vladislav Vainberg are in charge of the prosecution.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced that JERMAINE MYRIE was sentenced today to 135 months in prison for sex trafficking of a minor female.  MYRIE was sentenced by U.S. District Judge Kimba M. Wood, before whom he previously pled guilty to one count of conspiracy to engage in sex trafficking of a minor.  As part of his plea, MYRIE acknowledged that he trafficked a minor female.

Manhattan U.S. Attorney Geoffrey S. Berman said:  “Jermaine Myrie previously admitted to unconscionable conduct involving the exploitation of a minor girl who had resided in New York State’s social services system.  Today’s lengthy prison term exemplifies the seriousness of Myrie’s crimes against his vulnerable minor victim.  We will continue to advocate for the victims of these crimes and urge anyone who might have information that may be relevant to this investigation to contact the FBI at 1-212-384-1000 or https://tips.fbi.gov.”

According to the allegations contained in the Indictment and other court documents filed in Manhattan federal court:

From at least in or about January 2016 to in or about April 2016, JERMAINE MYRIE, a/k/a “Rapp,” the defendant, participated in a conspiracy to engage in sex trafficking and sexual exploitation of one minor victim (“Minor Victim-1”).  The defendant recruited, enticed, harbored, transported, provided, obtained, and maintained Minor Victim-1 for the purpose of commercial sex.  Prior to being trafficked by MYRIE, Minor Victim-1 previously resided at a residential treatment facility located in Westchester County, which provided housing for at-risk troubled children and adolescents on behalf of department of social services for certain counties in New York State.

The defendant recruited Minor Victim-1 to engage in commercial sex by conveying that he was romantically interested in her.  Subsequently, the defendant used the website Backpage.com, an online classifieds website, to post advertisements of Minor Victim-1 for commercial sex.  MYRIE directed Minor Victim-1 to engage in commercial sex in particular locations in the Bronx, New York.  The defendant used physical violence with Minor Victim-1, including to discourage Minor Victim-1 from working directly for any other pimps.  

*                *                *

In addition to his prison sentence, MYRIE, 35, was sentenced to five years of supervised release.

MYRIE is the second defendant to be sentenced in this case by Judge Wood for his participation in the sex trafficking of minors. 

• Reuben Sands, who pled guilty to conspiracy to violate the Travel Act, was sentenced on December 18, 2019, to a term of 60 months in prison.

            This case is part of an ongoing prosecution of 19 defendants, set forth in eight indictments, for the sex trafficking of at least 20 minor girls and young adults in New York State’s social services system.  All 19 of the defendants have been convicted, either via guilty plea or following trial.  In addition to MYRIE and Sands, three other defendants have also been recently sentenced:

• Christopher Bullock, who pled guilty to conspiracy to violate the Travel Act, was sentenced by U.S. District Judge Jesse M. Furman on December 6, 2019, to 54 months in prison. 
• Cimmie Wright, who pled guilty to conspiracy to violate the Travel Act, was sentenced by U.S. District Judge John F. Keenan on January 15, 2020, to 51 months in prison. 
• Dariel Braham, who pled guilty to conspiracy to violate the Travel Act, was sentenced by Judge Furman on January 29, 2020, to 48 months in prison.  

Any individuals who believe that they have information that may be relevant to this investigation should contact the FBI at 1-212-384-1000 or https://tips.fbi.gov.

Mr. Berman thanked the FBI and the NYPD for their outstanding work in this matter and, in particular, the New York Child Exploitation and Human Trafficking Task Force.

This case is being handled by the Office’s General Crimes Unit.  Assistant United States Attorneys Mollie Bracewell, Elinor Tarlow, Jacob Gutwillig, and Peter Davis are in charge of the prosecution. 

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced that GLENN BLICHT, the former president of a labor union (the “Union”), was sentenced to 24 months in prison for violating the Taft-Hartley Act by demanding and accepting approximately $150,000 in bribe payments from an employer (the “Employer”).  In exchange for these bribes, BLICHT did not represent Union members’ interests.  BLICHT previously pled guilty before United States District Judge Analisa Torres, who also imposed today’s sentence.

Manhattan U.S. Attorney Geoffrey S. Berman said:  “As the president of a labor union, Glenn Blicht’s duty was to fight for his union members.  Instead, he repeatedly sold them out in exchange for cash bribes, which he spent on luxury items.  For this betrayal, he has been sentenced to federal prison.”

According to the allegations in the Indictment to which BLICHT pled guilty, public court filings, and statements made in court:

From 2009 through 2019, BLICHT served as an officer of the Union, including as its president for many years.  In that role, BLICHT had a duty to act in the best interests of the Union and its members, including by avoiding personal financial conflicts of interest with the Union.  Nevertheless, BLICHT demanded and received cash payments from the Employer, which employed a number of members of the Union.  For instance, on July 26, 2019, BLICHT received a $10,000 cash bribe from an official of the Employer at a restaurant in New York, New York; BLICHT was arrested outside this restaurant, in possession of the $10,000 bribe.

In exchange for these bribes, BLICHT repeatedly declined to represent Union members’ interests, such as declining to pursue arbitration claims on their behalf.  In total, BLICHT received approximately $150,000 in bribes from the Employer over about 10 years. 

BLICHT used the monies he received to purchase luxury items, such as designer watches, custom clothing, tickets to sporting events, meals at expensive restaurants, and cigars.

*                *                *

In addition to his prison term, BLICHT, 57, of Wilton, Connecticut, was ordered to serve two years of supervised release.  BLICHT was also ordered to forfeit $150,000 in criminal proceeds.  Under the terms of his plea agreement, BLICHT has also agreed to a 13-year ban, which generally prohibits him from, among other things, being employed by a labor union or employee benefit plan, pursuant to 29 U.S.C. §§ 504 and 1111.

Mr. Berman praised the Department of Labor’s Office of Inspector General and Employee Benefits Security Administration, the Internal Revenue Service, Criminal Investigation Division, and the Federal Bureau of Investigation for their outstanding work on the investigation.  Mr. Berman also thanked the Department of Justice’s Labor-Management Racketeering Unit of the Organized Crime and Gang Section for its assistance in this case.

This matter is being handled by the Office’s Complex Frauds and Cybercrime Unit.  Assistant United States Attorney Michael D. Neff is in charge of the prosecution.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced that RICHARD DIVER pled guilty earlier today to fraud charges in connection with his embezzlement from the asset management company where he served as chief operating officer.  Specifically, DIVER pled guilty to investment adviser fraud in connection with his fraudulently overbilling the company’s clients by hundreds of thousands of dollars and rerouting those funds into his personal account, and wire fraud for diverting millions of dollars in the company’s payroll to which he was not entitled to his personal account over a period of several years.  DIVER pled before Judge Loretta A. Preska in Manhattan federal court.

 Manhattan U.S. Geoffrey S. Berman said: “As he admitted today, Richard Diver betrayed his employer and his company’s clients, all to enrich himself to the tune of millions of dollars.  This kind of fraud will not be tolerated.”

According to statements in the Indictment and Complaint in this case, and statements made in public court proceedings:

DIVER was the chief operating officer (“COO”) of a Manhattan-based asset management company (“Company-1”) that offers its customers investment planning and wealth management services.  As COO, DIVER’s responsibilities included overseeing the company’s payroll and billing functions. 

Beginning in 2011 and continuing into December 2018, DIVER fraudulently caused Company-1’s third-party payroll vendor to pay him salary significantly beyond his authorized salary and bonus.  Over that period, DIVER caused over $4.5 million to be routed to his personal checking account above and beyond his approved compensation.

In 2017, DIVER began to also defraud Company-1’s clients.  Typically, Company-1 billed its clients quarterly, in most cases having been authorized by the clients to deduct its investment advisory fees directly from their custodial accounts.  DIVER began to cause an employee to run the billing process, which was based on a fixed percentage of the assets the clients had under the company’s management, at off-cycle intervals as to certain clients in addition to the regular quarterly intervals at which it billed legitimately.  These billings were not accompanied by any notice.  The clients affected by this practice therefore had their accounts debited twice, but were only notified of the single legitimate billing in periodic reports and correspondence from the company.  DIVER routed the excess funds to his own personal bank accounts through the company’s payroll system.  Through this mechanism, DIVER defrauded the clients of over $700,000.

In December 2018, certain clients noticed the overbilling and complained to Company-1’s president, who confronted DIVER.  DIVER admitted to both fraudulent practices, stating that the funds he had stolen were consumed by his own “wild” spending.  More recently, law enforcement agents recorded a conversation in which DIVER acknowledged having defrauded the company of $4.5 million through the payroll fraud and certain clients of over $700,000 through the billing fraud.

*                *                *

DIVER, 63, of New York New York, pled guilty to one count of investment adviser fraud and one count of wire fraud.  The wire fraud count carries a maximum potential sentence of 20 years in prison.  The investment adviser fraud count carries a maximum sentence of five years in prison.  The maximum potential penalties are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the Judge.

Mr. Berman praised the investigative work of the U.S. Postal Inspection Service and thanked the New York Regional Office of the U.S. Securities and Exchange Commission, which has filed civil charges against DIVER in a separate action. 

This case is being handled by the Office’s Securities and Commodities Fraud Task Force.  Assistant United States Attorney Martin S. Bell is in charge of the prosecution.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced today that KEITH ORLEAN was sentenced today in Manhattan federal court to 32 months in prison for participating in a scheme to use false statements to promote and sell stock in his company. ORLEAN pled guilty on September 26, 2019, to one count of securities fraud and one count of securities fraud conspiracy before U.S. District Judge Vernon S. Broderick, who also imposed today’s sentence.

Manhattan U.S. Attorney Geoffrey S. Berman said:  “Keith Orlean and his co-conspirators obtained more than $2 million by taking advantage of innocent investors – many of them elderly – through blatant lies.  As this prosecution and today’s sentence reflect, this kind of predatory fraud will not be tolerated.”

According to the allegations contained in the Complaint, the Indictment, and statements made in related court filings and proceedings:

For several years, ORLEAN and his codefendants operated a fraudulent scheme in which a salesman named “Mike Palmer” would call elderly persons on the phone and offer them what he claimed was a time-sensitive opportunity to buy stock in certain companies.  In fact, there was no “Mike Palmer,” and the salesman was actually Vladimir Ziskind or Kevin Weinzoff, co-conspirators of the defendant who were taking turns using the fake alias.  The purported time-sensitive investment opportunity was also fabricated by the defendants, as the company in which they solicited investments were actually companies under their control.  In one intercepted phone call conversation, Ziskind described to KEITH ORLEAN his strategy for a successful investor sales pitch as:  “You ram it down their fucking throat.”  In another intercepted call between Ziskind and ORLEAN, upon learning that a particular victim investor died, Ziskind remarked:  “I knew I should have pulled the last $10,000 out of him.”   

The most recent version of the defendants’ phony sales pitch included false representations about an impending initial public offering, or “IPO,” for their company, Digital Donations Technologies, Inc.  For example, in April 2018, one of the defendants assured a victim investor that “our company is doing great,” that the company had an offer for an IPO valued at approximately $300 million, and that defendant KEITH ORLEAN was considering a private sale of the company for more than $1.5 billion. In truth, however, the defendants knew that the company had little or no actual commercial value and that no such IPO or sale was taking place.   

The Federal Bureau of Investigation (“FBI”) estimates that since April 2014, the defendants have convinced more than approximately 57 persons, many of whom were elderly, to purchase stock in companies controlled by one or more of the defendants based on false representations. During the period of the conspiracy, the defendants successfully solicited more than $2 million in stock purchases from victims.

*                *                *

In addition to a prison term, ORLEAN, 62, of Hauppauge, New York, was sentenced to three years of supervised release, ordered to pay restitution in the amount of $2,080,771, and ordered to pay a forfeiture money judgment in the amount of $883,700. 

Vladimir Ziskind and Kevin Weinzoff, who each previously pled guilty to his participation in the scheme, await sentencing.

Mr. Berman praised the outstanding work of the FBI.

The prosecution of this case is being overseen by the Office’s Securities and Commodities Fraud Task Force.  Assistant U.S. Attorneys Robert Boone and Andrew Thomas are in charge of the case.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced today that HUGH BRIAN HANEY was sentenced to 42 months in prison for money laundering charges, based on his attempt to launder the proceeds of a narcotics trafficking operation that HANEY ran on the Dark Web site known as “Silk Road.”  HANEY previously pled guilty to the money laundering charges before United States District Judge Jed S. Rakoff, who also imposed today’s sentence.

U.S. Attorney Geoffrey S. Berman said:  “Hugh Haney used the Dark Web site Silk Road to sell drugs illegally and avoid detection.  He then laundered more than $19 million in profits through cryptocurrency.  Now Haney is headed to prison for his crimes.”

As alleged in the underlying Complaint, Indictment, and statements made in open court:

Silk Road was an online criminal marketplace designed to be outside the reach of law enforcement or governmental regulation.  All transactions on Silk Road could be completed only through use of the cryptocurrency Bitcoin.  During its two-and-a-half years in operation, Silk Road was used by several thousand drug dealers and other unlawful vendors to distribute hundreds of kilograms of illegal drugs and other illicit goods and services to well over 100,000 buyers, and to launder hundreds of millions of dollars derived from these unlawful transactions.  Law enforcement shut down Silk Road in or about October 2013. 

One prominent narcotics vendor on Silk Road was called “Pharmville.”  HANEY was one of the operators of Pharmville, which supplied a dedicated community of individuals who often traded illicit narcotics.  HANEY had previously been convicted on federal charges for distributing narcotics via the Internet.  In 2018, pursuant to a judicially authorized search of Haney’s house in Ohio, law enforcement agents found on a computer in Haney’s house a document entitled “HBH DAILY TO DO LIST,” which among other things referred to Silk Road, Pharmville, and large scale narcotics trafficking including of the deadly opioid fentanyl, as well as a ledger of customers whom HANEY had supplied with fentanyl and pharmaceutical drugs.

In 2017 and 2018, HANEY transferred Bitcoins representing narcotics proceeds he had earned through his control of Pharmville from Bitcoin addresses connected to Silk Road to an account HANEY controlled at a company involved in the exchange of Bitcoins and other digital currency (“Company-1”).  In correspondence with Company-1, HANEY falsely claimed that he had legitimately earned these Bitcoins through cryptographically creating them and from fair transfers with others, while in reality the Bitcoin were derived from transfers from Silk Road.  After HANEY transferred the Bitcoins to cash worth more than $19 million through Company-1, law enforcement seized the money pursuant to a judicially authorized seizure warrant from a custodial account at a bank (“Bank-1”).

*              *             *

In addition to his prison term, HANEY, 61, of Westerville, Ohio, was sentenced to three years of supervised release, and ordered to forfeit approximately $19 million and pay a fine of $10,000.

Mr. Berman praised the outstanding investigative work of Homeland Security Investigations. 

This case is being handled by the Office’s Money Laundering and Transnational Criminal Enterprises Unit.  Assistant United States Attorneys Tara M. La Morte and Samuel L. Raymond are in charge of the prosecution.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, Peter C. Fitzhugh, Special Agent in Charge of the Department of Homeland Security’s (“DHS”) Homeland Security Investigations (“HSI”) in New York, and Dermot Shea, the Commissioner of the New York City Police Department (“NYPD”), announced today the arrest of TRACY REYNOLDS, a/k/a “Sara,” and IZHAK COHEN, for money laundering and conspiracy to commit money laundering in connection with their ownership and operation of VIP Escorts, a nationwide multimillion-dollar business offering high end prostitution services, as well as the seizure of bank accounts and 391 websites related to the VIP Escorts business.  REYNOLDS was arrested this morning at Tampa International Airport while boarding a flight to Mexico and was presented today in Tampa federal court.  COHEN was arrested by Israeli authorities in Hadera, Israel.  The United States Attorney’s Office will seek COHEN’s extradition to stand trial in the United States.

According to the allegations in the Complaint sworn out in Manhattan federal court:[1] 

From at least 2012 to the present, REYNOLDS and COHEN have operated an online high-end prostitution business through their company and its affiliates known as “VIP Escorts.”  VIP Escorts maintains a website, http://wvvw.vipescorts.com (the “VIP Escorts Website”), which it used to promote its prostitution services and was registered to COHEN.  VIP Escorts also operates an array of affiliated escort websites, which also advertised its prostitution services, with names such as “Prestige Escorts,” “American Escorts,” “Russian Escorts,” and “Manhattan Exotics,” all of which are registered to COHEN. 

As part of their prostitution business, REYNOLDS and COHEN arranged for escorts to meet clients in Manhattan and in numerous other locations for prostitution services, charging them thousands of dollars.  REYNOLDS and COHEN required escorts to deposit the proceeds of their commercial sex acts into a large number of bank accounts that they controlled, many of them in the name of fake entities.  REYNOLDS and COHEN then laundered the money through thousands of domestic and international financial transactions.  In total, over $10 million passed through various personal and business accounts controlled by REYNOLDS during the course of this conspiracy, and over $1 million was sent from REYNOLDS in the United States to COHEN in Israel in thousands of small transactions designed to conceal the nature, location, source, ownership, and control of the proceeds.

REYNOLDS and COHEN then used the proceeds of the prostitution scheme for personal gain and to further their illegal prostitution business.  They paid, for example, over $295,000 from bank accounts under their control to advertise the VIP Escorts business on a known advertising platform for the prostitution industry.   

*                      *                     *

REYNOLDS, 45, of Alamosa, Colorado, and Cohen, 53, of Hadera, Israel, are each charged with one count of conspiracy to commit money laundering, which carries a maximum sentence of 20 years in prison, and two counts of money laundering, each of which carries a maximum sentence of 20 years in prison.  The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge.

Mr. Berman praised the outstanding investigative work of HSI, NYPD, and the El Dorado Task Force, and expressed his sincere gratitude to the Israel National Police and the Israel Ministry of Justice for their support and assistance with the investigation.  He also thanked the Office of International Affairs of the U.S. Department of Justice for their assistance in the arrest of COHEN.

This case is being handled by the Office’s General Crimes Unit.  Assistant United States Attorney Michael R. Herman is in charge of the prosecution.

The charge contained in the Complaint is merely an accusation, and the defendant is presumed innocent unless and until proven guilty.

[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth herein constitute only allegations, and every fact described should be treated as an allegation.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, and Dermot Shea, Commissioner of the New York City Police Department (“NYPD”), announced today the unsealing of an indictment charging RALPH BERRY and FRANK LOPEZ with the murder of Caprice Jones in the vicinity of 751 East 161 Street, Bronx, New York.  BERRY was arrested on Friday in Bethlehem, Pennsylvania, and was presented before U.S. Magistrate Judge Henry S. Perkin.  LOPEZ was arrested on Friday in Plano, Texas, and was taken into federal custody on Monday.  He will be presented tomorrow before U.S. Magistrate Judge Christine A. Nowak.  The case is assigned to U.S. District Judge Alison J. Nathan.  

U.S. Attorney Geoffrey S. Berman said:  “Many years have passed since Caprice Jones was murdered, but the detectives of the NYPD continued investigating, working to see that justice would be done.  Now, thanks to their extraordinary efforts, in partnership with the Special Agents of our Office, Ralph Berry and Frank Lopez face federal murder charges.”

As alleged in the Indictment[[1]] unsealed today in Manhattan federal court:

On June 21, 2000, BERRY handed LOPEZ a gun and LOPEZ fired shots in the vicinity of 751 East 161st Street in the Bronx, New York.  The shooting was in furtherance of a conspiracy to distribute crack cocaine.  Jones was hit during the shooting, and ultimately died from his wounds in 2010 at the age of 42.

*              *             *

BERRY, 52, and LOPEZ, 43, are each charged with murder through use of a firearm, which carries a maximum penalty of death or life in prison and a mandatory minimum sentence of five years in prison, and murder in connection with a drug trafficking crime, which carries a maximum penalty of death or life in prison and a mandatory minimum sentence of 20 years in prison.  

The maximum potential sentence in this case is prescribed by Congress and is provided here for information purposes only, as any sentencing of the defendants will be determined by the judge.

 Mr. Berman praised the outstanding work of the NYPD and the Special Agents of the United States Attorney’s Office for the Southern District of New York.  He also thanked the United States Marshals Service and the Plano Police Department for their assistance with the arrests.

The case is being prosecuted by the Office’s Violent and Organized Crime Unit.  Assistant United States Attorneys Dominic A. Gentile and Maurene Comey are in charge of the prosecution.

The charges contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

[1] As the introductory phrase signifies, the entirety of the text of the Indictment and the description of the Indictment set forth herein constitute only allegations and every fact described should be treated as an allegation.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, Raymond P. Donovan, Special Agent in Charge of the New York Division of the U.S. Drug Enforcement Administration (“DEA”), Peter C. Fitzhugh, Special Agent in Charge of the New York Office of Homeland Security Investigations (“HSI”), Keith M. Corlett, Superintendent of the New York State Police (“NYSP”), and Dermot Shea, Police Commissioner of the City of New York (“NYPD”), announced that ANGEL GUADALUPE RAMOS‑RAMIREZ was charged in a criminal complaint in Manhattan federal court with conspiring to import more than 500 kilograms of methamphetamine into the United States.  The charge arises from a February 8, 2020, seizure by Mexico’s Secretaría de Marina (the “Mexican Navy”) of more than 500 kilograms of methamphetamine off the coast of San Felipe, Mexico.

Manhattan U.S. Attorney Geoffrey S. Berman said:  “Angel Guadalupe Ramos-Ramirez is charged with conspiring to import more than half a ton of methamphetamine into the U.S.  Thanks to our partners in this case, those dangerous drugs have been seized before they got here, and Ramos-Ramirez is in custody.”

DEA Special Agent in Charge Raymond P. Donovan said:  “Five hundred kilograms of crystal methamphetamine is a significant seizure that will save lives and take over $12 million of drug proceeds out of traffickers’ hands.  Methamphetamine is a fierce animal on the loose throughout the nation and a major threat to public health, which is why DEA and our law enforcement partners will not relent pursing drug trafficking organizations until they are brought to justice.”  

HSI Special Agent in Charge Peter C. Fitzhugh said:  “This case prevented large amounts of methamphetamine, a highly addictive and dangerous narcotic, from harming the public, regardless of where they happen to live.  Investigations like these are a great example of what can be accomplished with incredible cooperation among multiple agencies, and HSI is committed to collaboration in order to keep these deadly drugs out of our communities.”

State Police Superintendent Keith M. Corlett said:  “This investigation has prevented a large amount of dangerous drugs from reaching our shores, where they would have damaged lives and communities.  Our strong law enforcement partnerships are responsible for the success of this case, and I commend all the members and agencies involved for their outstanding work.”

Police Commissioner Dermot Shea said:  “This was a significant operation to interdict the kind of illegal drugs that cause so much harm on our streets.  I want to thank our detectives and law enforcement partners, here and abroad, for working together against this common threat.”

As alleged in the Complaint unsealed in federal court[1]:

On or about February 7, 2020, the Mexican Navy began tracking a boat traveling northwest through the Gulf of California from Sinaloa, Mexico toward Baja California, Mexico.  On February 8, 2020, the Mexican Navy interdicted the vessel off the coast of San Felipe, Mexico, in Baja California, and arrested RAMOS-RAMIREZ.  Mexican Navy officers seized approximately 26 plastic packages, each of which contained approximately 20 kilograms of methamphetamine, from the water around the boat.  In total, the Mexican Navy recovered more than 500 kilograms of methamphetamine from the water.

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RAMOS-RAMIREZ, 33, of Mexico, is charged with conspiring to import methamphetamine into the United States, which carries a mandatory minimum sentence of 10 years in prison and a maximum sentence of life in prison.

Mr. Berman praised the outstanding investigative work of the DEA.

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

The case is being handled by the Office’s Terrorism and International Narcotics Unit.  Assistant United States Attorneys Michael K. Krouse, Stephanie Lake, Daniel G. Nessim, Benjamin Woodside Schrier, and Kyle A. Wirshba are in charge of the prosecution.

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

[1] As the introductory phrase signifies, the entirety of the text of the Complaint, and the description of the Complaint and statements and filings in court set forth herein, constitute only allegations, and every fact described herein should be treated as an allegation as to the defendant charged in the Complaint.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced today that MARIO AMILCAR ESTRADA ORELLANA (“ESTRADA”), was sentenced to 180 months in prison for participating in a conspiracy to import and distribute tons of cocaine to the United States.  ESTRADA previously pled guilty to participating in a cocaine importation conspiracy before United States District Judge Jed S. Rakoff, who also imposed today’s sentence.

Manhattan U.S. Attorney Geoffrey S. Berman said:  “Mario Estrada conspired to solicit Sinaloa Cartel money to finance a corrupt scheme to get him elected president of Guatemala.  Estrada promised to assist the cartel to export tons of cocaine into the U.S., and he attempted to arrange the assassinations of political rivals.  Thanks to the DEA, rather than a shot at the presidency in Guatemala, Estrada is headed to prison in the United States.”

According to the allegations in the Indictment to which ESTRADA pled guilty, public court filings, and statements made in court:

While he was running for president of Guatemala in 2018 and 2019, ESTRADA attempted to solicit funding from international drug cartels to support ESTRADA’s presidential campaign (the “Estrada Campaign”).  During certain of these negotiations, members of the Estrada Conspiracy, including ESTRADA and his co-defendant, Juan Pablo Gonzalez Mayorga (“Gonzalez”), interacted with purported members and associates of the Sinaloa Cartel – a powerful international drug-trafficking organization based in Mexico – who were, in fact, confidential sources (the “CSes”) acting at the Drug Enforcement Administration’s (“DEA”) direction.  At times during the course of his negotiations with the CSes, ESTRADA was polling in the top five of candidates for the Guatemalan presidency.    

During the course of their meetings and other communications with the CSes, some of which were video and audio recorded, ESTRADA and Gonzalez requested millions of dollars in drug proceeds from the Sinaloa Cartel to support the Estrada Campaign.  In exchange for financial support from the Sinaloa Cartel, ESTRADA and Gonzalez promised that if ESTRADA was elected president of Guatemala, ESTRADA would provide Guatemalan state-sponsored support to the Sinaloa Cartel’s drug-trafficking activities.  Among other things, ESTRADA and Gonzalez agreed to provide the Sinaloa Cartel with unfettered access to Guatemalan airports and maritime shipping locations so that the cartel could transport ton quantities of cocaine through Guatemala and ultimately into the United States.  ESTRADA also offered to appoint members of the Sinaloa Cartel to high-ranking government positions in Guatemala so that the CSes would be positioned to advance the Sinaloa Cartel’s drug-trafficking activities.  ESTRADA also agreed that he would receive a portion of the profits made by the Sinaloa Cartel on the cocaine it transited through Guatemala under his protection.  Throughout, ESTRADA believed he was negotiating with representatives from the leadership of the Sinaloa Cartel. 

In addition, during the course of his meetings with the CSes, ESTRADA bragged of his other drug cartel connections.  More specifically, ESTRADA stated that the Jalisco Nuevo Generación cartel in Jalisco, Mexico, had offered him financial support in connection with his campaign, and also boasted that he was working with a drug trafficker in Guatemala who was supporting his bid for president.  Further, at various times during their negotiations with the CSes, ESTRADA and Gonzalez also directed the CSes to hire hitmen to assassinate political rivals and their associates to ensure that ESTRADA was elected president of Guatemala.  In particular, ESTRADA and Gonzalez identified specific targets by name and agreed to provide the hitmen with firearms, including AK-47s, to carry out the murders.

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In addition to his prison term, ESTRADA, 59, of Guatemala City, Guatemala, was sentenced to four years of supervised release.

Mr. Berman praised the outstanding efforts of the DEA’s Miami Field Office and its Guatemala Country Office, as well as the U.S. Department of Justice’s Office of International Affairs.

This case is being handled by the Office’s Terrorism and International Narcotics Unit.  Assistant U.S. Attorneys Mathew Laroche and Jason A. Richman are in charge of the prosecution.