Northern District of Ohio

An Akron man was sentenced to more than three years in prison and ordered to pay more than $15 million in restitution for his role in a mortgage fraud scheme in Florida and a separate scheme to defraud two elderly investors, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.

Andrew D. Norman, 36, previously pleaded guilty to conspiracy to commit bank fraud, conspiracy to commit wire fraud and filing a false tax return.

Norman and his business partner Jason Herceg conspired with Jack Coppenger in procuring “straw buyers” and submitting false loan documents to banks to purchase Coppenger’s lots in Florida (which had already been inflated in value as part of a land flip) in a mortgage fraud scheme.  Coppenger, with assistance from Norman and Herceg, perpetrated a large mortgage fraud scheme involving numerous straw buyers, who essentially sold their good credit score to Coppenger, in order for him to secure loans, through straw buyers’ names, for property in Florida, according to court documents. 

Coppenger promised money to the straw buyers if they signed the loan application and paperwork, that he would make any down payment and all the mortgage payments for the straw buyers, and that, once the property was developed, they would receive half the profits from any sale, according to court documents. 
Norman and Herceg were mentored by Coppenger in how to recruit and use straw buyers. Norman and Herceg assisted Coppenger by using their brokerage company, Akron-based V.P. Equity, to prepare and submit falsified loan documents to the banks, which fraudulently inflated the income and assets of the straw buyers to qualify them for these loans. Ultimately, Coppenger failed to make the mortgage payments on these loans, resulting in a loss to banks of approximately $13.1 million, according to court documents. 

In the second conspiracy scheme, Norman, Herceg, Coppenger and others, conspired to defraud two elderly individuals by selling them a Florida property for $7 million.  Moments before the sale, Norman and Herceg, with Coppenger’s help, bought the property, through their partnership, 104 Investments, from the original seller and inflated its value by approximately $2.5 million. They then sold this property to these elderly individuals, who were told they were buying the property from the original seller.  These elderly victims were never told of the last minute “flip” and that they were actually buying the land from Norman, Herceg and 104 Investments.  Norman, Herceg, and their 104 Investments business partner, Robert Jason Workman, received approximately $2.5 million from this gain, and funneled portions out to themselves and paid $690,000 to Coppenger as a kickback for setting up the fraudulent scheme, which they fraudulently deducted as a business expenses, according to court documents.

Norman also failed to report the income from this fraudulent scheme on his 2006 tax return.  

Coppenger and Herceg have pleaded guilty to related crimes and are awaiting sentencing.

The case is being prosecuted by Assistant U.S. Attorneys Christian H. Stickan, Henry F. DeBaggis and Robert J. Patton following investigation by agents of the Internal Revenue Service – Criminal Investigations and the Federal Bureau of Investigation’s Akron office.

On May 16th, IRS agents arrested Margaret Monone Greenaway on a two-count indictment charging her with claiming false income tax refunds totaling $5,271,794 for the years 2010 and 2011, said Steven M. Dettelbach, United States Attorney.

Greenaway filed income tax returns using her name during a prior marriage, Margaret M. Demaria-Susevich, on which she claimed refunds to which she was not entitled of $1,326,671 for 2010 and $3,945,123 for 2011, according to the indictment.

Greenaway, age 52, resides in Willowick, Ohio, according to court records.  Following her arrest, Greenaway entered not guilty pleas before U.S. Magistrate Judge Kenneth S. McHargh, who ordered her to be temporarily detained while efforts were made to arrange for her release subject to home detention with electronic monitoring and the removal of computers from her home. 

The case is assigned to United States District Judge David D. Dowd, in Akron.

The case was presented for indictment by Assistant United States Attorney John M. Siegel following an investigation by the Internal Revenue Service – Criminal Investigation, Cleveland, Ohio.

If convicted, the defendant’s sentence will be determined by the court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.

An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.

A Dennison man was sentenced to nearly 22 years in prison for crimes related to the production and distribution of child pornography, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.

Vernon L. Kriner, Jr., 43, pleaded guilty earlier this year to child exploitation, possession of child pornography and two counts of receipt and distribution of visual depictions of children engaged in sexually explicit conduct.

U.S. District Judge Patricia A. Gaughan sentenced Kriner to 262 months in prison.

This case was prosecuted by Assistant United States Attorney Michael A. Sullivan following an investigation by the Federal Bureau of Investigation.

A Medina chiropractor was sentenced to 30 months in prison for overbilling Medicare and insurance companies more than $1.8 million for medical equipment and treatment that were not medically necessary, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.

Dr. John N. Heary, 39, previously pleaded guilty to seven counts of health care fraud.

“This doctor took advantage of programs designed to provide care and support for the old and the sick,” Dettelbach said. “Our office and the Justice Department are committed to rooting out health care fraud in all its forms.”

“Most medical professionals endeavor to provide quality health care services and submit proper claims for payment to the Medicare program” said Lamont Pugh III, Special Agent in Charge of the U.S. Department of Health & Human Services, Office of Inspector General – Chicago Region. “This doctor chose to exploit Medicare and other insurers for illegal personal gain and paid the price for his criminal acts. The OIG will continue to work with our law enforcement partners to combat fraud in the health care system and protect vital taxpayer dollars.”

Heary did business under his name and two corporate entities. HealthSource of Medina was the operating name of Heary’s chiropractic practice until October 2009. Medina Health & Wellness Center, Inc. was the corporate name under which Heary sold durable medical equipment, according to court documents.
Both entities were located at 433 West Liberty Street, Medina, Ohio, 44256, according to court documents.

Heary provided custom-molded ankle-foot orthotics, or “boots”, to patients who did not need them and wrote false diagnoses to justify the billing. He billed Medicare and insurance anywhere from $2,770 to $4,300 for each pair of boots, according to court documents.

He also routinely provided the most expensive back braces without any demonstration of medical necessity or any pursuit of a less costly alternative. He billed Medicare and insurance anywhere from $995 to $1,250 for each back brace, according to court documents.

When patients questioned the necessity of this medical equipment, Heary told them tha they were part of a “free package deal” and would be covered by their insurance, according to court documents.

Hearly also billed for supervised physical therapy often when the patients were not supervised. He also billed for an hour’s worth of physical therapy when, at most, patients did a half hour, according to court documents.

Heary submitted more than $1.8 million in fraudulent claims to Medicare, Anthem Blue Cross and Blue Shield, Medical Mutual of Ohio and the Ohio Bureau of Worker’s Compensation, according to court documents.

The insurance programs reimbursed Heary for more than $812,000. He will repay that amount in restitution, according to court documents.

This case is being prosecuted by Assistant United States Attorneys Michael L. Collyer and Adam Hollingsworth following an investigation by the U.S. Department of Health and Human Services, Office of Inspector General, Office of Investigations, the Federal Bureau of Investigation, the Ohio Bureau of Worker's Compensation and the Ohio Chiropractic Board.

If you suspect health care fraud, waste or abuse, please report it by calling HHS Office of Inspector General at 800-447-8477, the Centers for Medicare & Medicaid Services at 800-633-4227, or the FBI Cleveland Field Office at (216) 522-1400.  To learn more about health care fraud prevention and enforcement go to www.medicare.gov.

A man and woman from Lorain County were charged with human trafficking crimes after forcing a 16-year-old girl and 19-year-old woman to have sex for money, said Stephen D. Anthony, Special Agent in Charge of the FBI’s Cleveland office, and Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.

Jeremy Mack, 37, of Elyria, and Ashley Onysko, 23, of Avon Lake, were charged with two counts of sex trafficking (one involving a minor) in a criminal complaint unsealed today in U.S. District Court.

“Human trafficking often happens in plain sight,” Anthony said. “The FBI, our law enforcement partners, along with the assistance of vigilant citizens will continue efforts to tackle this problem.”

“These defendants are accused of preying on teens in our community,” Dettelbach said. “We will work to get help for the victims and bring the accused to justice.”

Mack and Onysko were arrested April 9, 2013 at 8 Tattersal Court in Elyria. Onysko told investigators that she worked for Mack facilitating meetings for sex between girls and men. She posted advertisements on backpage.com and craigslist.com, according to an affidavit filed in the case.

One victim, identified as “Jane Doe #1” was 19 and was forced to have sex for money in order to pay off a drug debt to Mack. Jane Doe #1 said several girls lived at 8 Tattersal Court and were forced by Mack to prostitute themselves in order to pay off their drug debts to him, according to the affidavit.

Jane Doe #1 began seeing several men a day charged to engage in sexual acts with them. Mack or Onysko drove Jane Doe #1 to the appointments but she had to turn all the money over directly to Mack, according to the affidavit.

Jane Doe #1 stated that if she kept any money, she believed Mack would “beat the living crap out of me.” She witnessed him push, hit and choke other girls and said Mack often carried a handgun and stun gun, according to the affidavit.

Another victim, identified as Jane Doe #2, met Mack through Mack’s son in March 2013. Jane Doe #2 noticed that the other girls were afraid of Mack and didn’t seem allowed to leave the house except to meet clients, according to the affidavit.

On March 29, 2013, Mack instructed Jane Doe #2 to get fixed up and instructed other girls to take photos of her for backpage.com. Jane Doe #2 said she didn’t want to be a prostitute but did so because Mack was “a guy with a gun who knew where I lived,” according to the affidavit.

Onysko soon received a call for an appointment with Jane Doe #2. Onysko arranged the meeting and provided Jane Doe #2 with condoms. She gave all the money to Mack. Jane Doe #2 left the house on Tattersal after her parents discovered her photographs on backpage.com, according to the affidavit.

This case is being prosecuted by Assistant United States Attorneys Bridget M. Brennan and Carole Skutnik following an investigation by the FBI and Elyria Police Department.

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

A New York man was charged wtih trafficking in counterfeit merchandise after investigators found him with more than 1,300 counterfeit items, including handbags, sunglasses and shirts, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.

Man Zhang, age 30, of Woodside, New York, was named in the one-count indictment.

On or about March 27, 2013, Zhang intentionally trafficked and attempted to traffic more than 1,300 items, including 225 designer handbags, 53 designer wallets, 71 pairs of designer sunglasses, 339 hats, 349 Monster and Ed Hardy tee-shirts, and 209 bottles of designer perfume, each of which contained counterfeit marks, logos, labels and tags, according to the indictment.

The marks on the merchandise were identical to and substantially indistinguishable from marks used on genuine merchandise, and were in use and registered for such goods on the principle register of the United States Patent and Trademark Office. The use of such counterfeit marks was likely to cause confusion, mistake or to deceive, according to the indictment.

According to a criminal complaint previously filed in this matter, Zhang’s vehicle was stopped in Austintown, Ohio, on March 27, 2013, for a traffic violation. Upon stopping the vehicle, police officers observed numerous items in plain view inside the vehicle which appeared to be counterfeit merchandise. Zhang was arrested on outstanding state warrants and the vehicle was impounded and inventoried.

If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation.

This case is being prosecuted by Assistant U.S. Attorney Robert W. Kern of the Cleveland U.S. Attorney’s Office, following an investigation by the Cleveland Office of the Department of Homeland Security, Office Immigration and Customs Enforcement.

An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government's burden to prove guilt beyond a reasonable doubt.

Two Toledo men were charged with violations of the Clean Air Act and regulations involving the removal and disposal of asbestos-containing material, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.

Charged are John Mayer, age 52, and Timothy Bayes, age 32.

“These defendants are accused of ignoring laws and regulations that are in place to protect the public,” Dettelbach said. “Protecting the environment, including the air we breathe, is a priority of my office and the Justice Department.”

The indictment alleges that between September 2010 and December 2010, Mayer directed individuals to remove asbestos-containing insulation from boilers, duct work and pipes in a former manufacturing facility in Toledo, Ohio, in order that Mayer could sell the scrap metal from those items. This work was performed in violation of the federal Clean Air Act regulations regarding asbestos abatement, according to the indictment.

It is alleged that the asbestos-containing insulation was not wetted at any time during the removal process; the City of Toledo, Division of Environmental Services, was not notified prior to the work commencing; and, that there was not on site a person trained in the provisions of the federal asbestos regulations.

Bayes, at Mayer’s direction, dumped approximately 82 garbage bags of the asbestos-containing insulation at various locations throughout Toledo in violation of the requirement that such material be disposed at a site operated in accordance with federal law, according to the indictment.

If convicted, each defendant’s sentence will be determined by the court after review of factors unique to each case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.

The investigating agencies in this case are the U.S. EPA Criminal Investigation Division, the Ohio Bureau of Criminal Identification and Investigation, and the Ohio Environmental Protection Agency, all members of the Northwest Ohio Environmental Crimes Task Force. The case is being handled by Assistant United States Attorney Thomas A. Karol and Special Assistant United States Attorney James J. Cha.

An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.

An indictment was filed charging Stuart Duchon, age 65, of Toledo, Ohio, with failing to collect and pay over employees’ portion of FICA taxes, as well as the employees’ withholding federal income taxes, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.

Duchon owned and operated an orthodontist practice in Toledo and from 2007 to 2011, he failed to collect and pay to the Internal Revenue Service approximately $187,000 for the federal taxes withheld from his employees wages, according to the indictment.

If convicted, the defendant’s sentence will be determined by the court after review of factors unique to each case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.

The investigating agency in this case is the Internal Revenue Service. The case is being handled by Assistant United States Attorney Thomas A. Karol.

An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.

Two Canton men were named in an eight-count indictment, accused of allegedly participating in numerous burglaries and thefts of coins, jewelry, silver bars from businesses and then selling the stolen goods in Ohio, Pennsylvania, and Illinois, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.

Nicholas Moore, age 23, and Arsenio Smith, age 25, are charged with conspiracy, transportation of stolen goods and sale or receipt of stolen goods across state lines.

If convicted, their sentence will be determined by the Court after review of factors unique to this case, including prior criminal record, if any, role in the offenses and the unique characteristics of the violations. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.

The case is being prosecuted by Assistant U.S. Attorney Teresa Dirksen following an investigation by the Uniontown Police Department/Lake Township and Federal Bureau of Investigations in conjunction with the Salem Police Department, Stark County Sheriff’s Office, Lexington, Kentrucky Police Department, Richland County Sheriff’s Office, Mansfield Police Department, Stow Police Department, Springfield Police Department, Wooster Police Department, Jackson Township Police Department, Uniontown Police Department, and Robinson Township Police Department,

An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government's burden to prove guilt beyond a reasonable doubt.

Two people were sentenced for the malicious destruction of federally-licensed communications lines, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.

Thomas M. Carbone, 28, of North Royalton, was sentenced to 27 months in prison while Katie M. Stanton, 23, of Cleveland, was sentenced to eight months under house arrest. They were ordered to pay $10,971 in restitution.

On or about August 17 to 18, 2012, Carbone and Stanton unlawfully entered the property of Radio One on Ridge Road in North Royalton, Ohio, and willfully and maliciously destroyed and removed copper material from four radio-station towers situated on the property, according to court documents.

This unlawful removal of copper depleted the signal strength of the supported radio station, thereby impeding the station’s ability to broadcast emergency messages, according to court docuements.

This case is being prosecuted by Assistant United States Attorneys Thomas E. Getz and M. Kendra Klump. The case was investigated by the Cleveland Division of the Federal Bureau of Investigation and the North Royalton Police Department.

Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, today announced that a grand jury returned a two-count indictment charging Lisa J. Music, 54, of Canton, with one count of theft of government property and one count of Social Security fraud.

The indictment alleges that Music stole and converted to her own use, approximately $37,390 in Social Security payments made to her that she was not entitled to receive.

The indictment further alleges that Music concealed and failed to disclose her marriage to her second husband in order to continue to receive Social Security payments.

If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation.  In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.

The case is being prosecuted by Assistant U.S. Attorney Lauren Bell, following investigation by agents of the Social Security Administration Office of Inspector General.

An indictment is only a charge and is not evidence of guilt.  A defendant is entitled to a fair trial in which it will be the government's burden to prove guilt beyond a reasonable doubt.

A Mansfield man was indicted on charges that he embezzled more than $1 million from an customer annuity accounts at an insurance company where he worked, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.

Willard C. Lee, age 51, was indicted on one count each of insurance embezzlement and wire fraud.

Lee was employed by Allstate. The indictment alleges that Lee embezzled approximately $1,056,000 from Allstate customer annuity accounts between July 2007 and December 2011. Lee forged customer signatures on withdrawal requests to Allstate and Lincoln Benefit Life, a company wholly owned by Allstate, which sells annuities, according to the indictment.

Once fraudulent paperwork was submitted, Lee had the proceeds wire-transferred into bank accounts he controlled in Mansfield, according to the indictment.

The case was presented for indictment by Assistant United States Attorney James V. Moroney following an investigation by the Federal Bureau of Investigation;’s Mansfield office, who in turn were following up an investigation by the Investigative Services unit of the Allstate Insurance Company.

If convicted, the defendant’s sentence will be determined by the court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.

An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.

Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, today announced that a federal grand jury has returned an indictment charging Marcos A. Cardenas-Landino, age 24, formerly of Cleveland, with illegal re-entry following deportation or removal.

The indictment alleges that on February 27, 2013, Cardenas-Landino was illegally present in the United States after previously being deported subsequent to a conviction for the commission of possession of a controlled substance with intent to sell.

The indictment was presented to the grand jury by Assistant United States Attorney Lauren Bell after investigation by United States Immigration and Customs Enforcement.

If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to the case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense, and the characteristics of the violation.  In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.

An indictment is only a charge and is not evidence of guilt.  A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt. 

Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, today announced that a grand jury returned a two-count indictment charging Bonita A. Armstead, 37, of Cleveland, with one count of theft of government property and one count of Social Security Fraud.  

The indictment alleges that Armstead stole and converted to her own use, approximately $122,149.10 in Social Security payments made to her that she was not entitled to receive.

The indictment further alleges that Armstead obtained and used a second Social Security account number to receive Social Security Benefits.

If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation.  In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.

The case is being prosecuted by Assistant U.S. Attorney Lauren Bell, following investigation by agents of the Social Security Administration, Office of Inspector General.

An indictment is only a charge and is not evidence of guilt.  A defendant is entitled to a fair trial in which it will be the government's burden to prove guilt beyond a reasonable doubt.

Steven J. Woods, 49, of Cuyahoga Falls, Ohio, was charged with receiving, distributing and possessing visual depictions of minors engaged in sexually explicit conduct, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio

The indictment charges that from on or about February 28, 2013, through on or about April 4, 2013, Woods knowingly received and distributed, by computer, numerous computer files, which contained visual depictions of real minors engaged in sexually explicit conduct. On April 5, 2013, images of child pornography were also found on his external hard drive.

The actual sentence in this case will be determined by the Court after consideration of the Federal Sentencing Guidelines which depend upon a number of factors unique to each case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the unique characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.

This case is being prosecuted by Assistant United States Attorney Carol M. Skutnik. The case was investigated by the Cleveland Office of the United States Secret Service and the Cuyahoga Falls Police Department.

An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.

A Vermilion man was charged with financial crimes that resulted in nearly 100 clients losing more than $4.4 million over a decade, law enforcement officials said today.

Richard A. Zakarian, age 47, is charged with two counts each of wire fraud and mail fraud and one count of making and subscribing false income tax returns. Zakarian was a certified financial planner and a self-employed tax preparer who owned and operated several business ventures.

The five-count information details two schemes by Zakarian – one to defraud investment clients (many of whom were also clients of his tax-preparation business), another to defraud clients whose payroll taxes he handled through a company known as Ben Franklin Payroll Service.

Many of the payroll tax victims were churches, charities and other non-profit organizations that Zakarian lured as clients through purported grants from charity he claimed to operate. The information further details Zakarian’s falsification of his tax returns to conceal his fraudulently generated income from the investment scheme.

“This defendant is accused of taking advantage of trust of dozens of clients, which ranged from homeless shelters and nursery schools to retirees and those with disabilities,” said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio. “The conduct laid out here is as outrageous as it is predatory.”

Stephen D. Anthony, Special Agent in Charge of the Federal Bureau of Investigations’ Cleveland Office, said: “Zakarian orchestrated multiple financial schemes that all had one common thread, monetary benefit to him.  Authorities will continue to bring those to justice that choose to unlawfully violate the trust of their clients.”

“Investment fraud schemes are often described as a house of cards.  The underlying structure can fall apart at any time and expose the individuals responsible," said Kathy A. Enstrom, Acting Special Agent in Charge, IRS, Criminal Investigation, Cincinnati Field Office.  “Investment schemes that seem too good to be true should be a signal to investors to stay clear.”

The information filed in U.S. District Court details the following schemes:

THE INVESTMENT SCHEME

From September 2002 through August 2012, Zakarian devised a scheme to defraud investment clients by inducing them to invest their retirement funds, and occasionally other savings, through him as their account representative through false and fraudulent misrepresentations. He primarily targeted clients from his tax-preparation business when they received their tax refunds or sought his financial advice.

Zakarian misled clients to believe their funds would be placed in safe, guaranteed-return investments when, in fact, he diverted the funds to pay personal and business expenses and invested in risky investments for which he had a consistent history of incurring large losses.

Zakarian recruited 25 investment clients, often targeting tax preparation clients who he knew to have available funds and to be susceptible to his pitch through their prior relationship of trust in him.

hile some received a return on part or all of their investment, 23 clients incurred combined out-of-pocket losses of more than $1 million. In addition, the clients did not receive hundreds of thousands of dollars of gains on their investments that Zakarian falsely reported to them during the scheme.

A number of clients were retired, out of work, or nearing retirement. Most invested through Zakarian by moving their money from in traditional, relatively safe and dependable stocks, bonds and mutual funds.
In one case, Zakarian convinced a recently retired client to pay an early-withdrawal penalty to move money from a certificate of deposit purchased upon retirement. He induced another client to redeem a life insurance annuity to generate investment funds and talked her out of using the money to pay off her home mortgage or car loans.

Until mid-2009, Zakarian obtained use of clients funds primarily by having them place their investments with companies offering self-directed IRA services, and then having those companies transfer the funds to Zakarian as investments in promissory notes he issued. Zakarian initially issued the notes personally, as Zakarian Tax Consultants, but later issued them through a shell real estate company, Viewcrest Properties. Zakarian touted the IRA companies to his clients and misled many clients into believing that they were investing in those companies or that the use of the companies would assure the safety of their investments. Due to Zakarian’s misrepresentations, many clients did not realize their investments involved promissory notes.

THE PAYROLL TAX SCHEME

Zakarian began his separate payroll tax scheme in 2010 that continued through August 2012.
He induced clients to retain Ben Franklin Payroll Service, which he owned and operated, leading them to believe the company would and did file the client’s required employment tax returns and reports and pay the clients’ federal, state and local tax obligations.

The funds should have been forwarded to various taxing authorities to pay the income taxes of his clients’ employees. In reality, he failed to file many of the returns and diverted substantial portions of the clients’ funds to pay his own personal and business expenses and invest in highly-leveraged, risky investments with a consistent history of sustaining large losses.

Zakarian attempted to solicit for-profit clients by offering services well below market rates and below his own operating costs, such as a rate of $1 per employee per pay period. Later in 2010, after this failed to generate as many clients as he envisioned, Zakarian developed a new plan to solicit churches, charities and other non-profits through a purported “grant” program. These organizations were targeted as they typically had tight budgets sensitive to payroll costs. Zakarian’s primary objective was to gain access to their operating accounts.

Zakarian began marketing Ben Franklin Payroll Service as being affiliated with Zakarian Charities and the Benjamin Franklin Foundation, organizations established “as an effort to give back to the community.” He offered payroll grants from the Benjamin Franklin Foundation to non-profit organizations to cover two years of free payroll service through Ben Franklin Payroll Service.

To make the grant process appear legitimate, the application required the applicant to submit a one- or two-page narrative history and mission statement, a copy of the IRS tax-exempt determination letter, a list of the Board of Directors, an IRS Form 990 and an annual report, if available. About two weeks after receiving the client’s application, Zakarian sent a congratulatory letter, announcing that the Benjamin Franklin Foundation had awarded a two-year renewable grant.

Rather than forwarding the monies withdrawn to from his clients’ accounts directly to taxing authorities, Zakarian instructed his employees to transfer the tax funds to a Ben Franklin Payroll Service operating account. Clients were sent false quarterly employment tax returns and payroll summaries, giving the false impression that their payroll taxes were being properly handled.

In total, Ben Franklin had at least 72 clients who incurred combined losses of more than  $3.4 milllion from Zakarian’s fraudulent diversion of their employment tax funds entrusted to his company. Just over half of the losses were incurred by at least 29 non-profit organizations, with the rest being incurred by at least 43 businesses.

Zakarian also filed false federal income returns for the years 2006 through 2009, failing to report the income he received from the investment scheme. He filed the 2006 through 2008 returns deliquently in December 2009 after the Ohio Division of Securities requested copies. On the 2006 and 2007 returns, Zakarian also falsely claimed substantial losses on the investments he made with the fraudulently obtained client funds, and used those losses to offset other income he earned those years.

If convicted, the defendant’s sentences will be determined by the court after review of the federal sentencing guidelines and factors unique to each case, including the defendant’s prior criminal record, if any, the defendant’s role in the offenses and the characteristics of the violations.

This case is being prosecuted by Assistant U.S. Attorneys Robert J. Patton and John M. Siegel, following an investigation by the Federal Bureau of Investigation, the Internal Revenue Service – Criminal Investigation, the Lorain Police Department, and the Lorain County Prosecutor’s Office. The investigators also received assistance from the Ohio Department of Commerce, Division of Securities.

An information is only a charge and is not evidence of guilt.  A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.

A former Kirtland man was sentenced to more than two years in prison for filing false income taxes, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.

John C. Hartman, age 61, previously pleaded guilty to two counts of filing false tax returns for the years 2005 and 2006. His tax returns omitted more than $360,000 in income obtained from relatives that he defrauded, according to court documents.

Hartman solicited the money from family members under the guise that he was going to invest their money in various investments such as stock, raw materials and real property. He never invested these funds. Instead, Hartman used these funds to pay for personal expenses, according to court documents.

Hartman also obtained money by telling his friends and family members that he needed funds to pay for outstanding tax obligations, a bad stock investment, and medical expenses for his sick wife. He obtained these funds under the guise of loans. Hartman had no such delinquent tax obligations or bad stock investments and his wife did not have the serious medical condition that Hartman described. Hartman had no intention to repay any of the funds he purported to be loans. Instead, Hartman spent the funds on personal expenses, according to court documents.

The unreported income from fraud for 2005 and 2006 was $230,000 and $136,500, respectively. The tax loss for 2005 and 2006 was $65,797 and $17,963, respectively.

This case is being prosecuted by Assistant United States Attorney Robert Patton and Special Assistant United States Attorney Perry D. Mastrocola, following an investigation by the Internal Revenue Service Criminal Investigation Division.

A Bristolville man pleaded guilty today to crimes for his role in a murder-for-hire plot, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.

Andrew Martin, age 23, pleaded guilty to use of an interstate commerce facility in the commission of murder-for-hire, conspiracy to commit wire fraud and obtaining individually identifiable health information.

“This defendant sought to have a woman killed over a home on Clifton Boulevard,” Dettelbach said. “The community is fortunate that law enforcement was vigilant and stopped this plot before it got too far.”

Martin is scheduled to be sentenced by U.S. District Judge Christoper Boyko on July 18.

Martin worked as a registered nurse at a local hospital. He and another person (identified as D.S., who worked in the business of residential property repair and rehabilitation) conspired to take ownership and control of the house at 17225 Clifton Boulevard in Lakewood, which was owned by a person identified as G.W. who was a patient at the hospital where Martin worked, according to court documents.

This would be done, in part, by Martin accessing G.W.’s medical records. He passed that information on to D.S., who fraudulently maintained he had a personal relationship with G.W., which caused the homeowner to transfer ownership of the Clifton property prior to the G.W.’s death, according to court records.

On Nov. 21, 2011, Martin and D.S. caused a fraudulent quitclaim deed to be filed with the Cuyahoga County Recorder, which transferred ownership to D.S. D.S. had fraudulently represented to others that he had a personal relationship with G.W. based on medical records accessed by Martin, according to court documents.

A woman identified as J.C. was the sister of G.W. and the administrator of his estate. On Nov. 21, 2011, Martin and D.S. met J.C. at the property, where they maintained D.S. was the rightful owner, according to court documents.

In February 2012, Martin prepared D.S. for a deposition relating to the transfer of the Clifton property by providing D.S. with personal information about G.W. that Martin learned from accessing his medical records at the hospital, according to court documents.

On November 5, 2012, Martin used a telephone in connection with his intention that J.C. be murdered in exchange for the promise of $10,000, according to court documents.

Martin solicited a patient at the hospital to kill J.C. because “she has been trying to mess up my life” and then followed up with telephone calls which related to the solicitation. Martin wanted the patient to “put four in her head and make it look like a robbery,” according to court documents.

This case is being prosecuted by Assistant United States Attorneys Henry F. DeBaggis and Kelly L. Galvin following an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives, with assistance from the Maple Heights Police Department and Lakewood Police Department.

Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, today announced the filing of an information charging Scott A. Fischer, age 54, of Marion, Ohio, with tax evasion for calendar years 2006 through 2010.

The charges allege that Fischer evaded a total of $899,781.00 in federal income tax.

If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to each case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.

The investigating agency in this case is the Internal Revenue Service Criminal Investigation Division. The case is being handled by Assistant United States Attorney Joseph R. Wilson.

An information is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.

A Florida man pleaded guilty today in the U.S. District Court to crimes related to a scheme to defraud investors in the sale of Iraqi dinar currency and two non-existent hedge funds, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, and Kathy A. Enstrom, Acting Special Agent in Charge, IRS-Criminal Investigation, Cincinnati field office.

Rudolph M. Coenen, age 47, of Jacksonville, Florida, pleaded to one count of conspiracy to commit wire fraud, one count of wire fraud and five counts of money laundering before U.S. District Court Judge Jack Zouhary. 

Coenen admitted to entering into a conspiracy with Bradford L. Huebner, Charles N. Emmenecker and Michael L. Teadt to defraud investors through the promotion and sale of Iraqi dinar currency and “placements” in two non-existent hedge funds.  Coenen operated a business known as Bayshore Capital Investments to collect funds related to the non-existent hedge funds for himself, Huebner, Emmenecker and Teadt, according to court documents.

Huebner developed and provided prospective investors with professional literature and information regarding the non-existent hedge funds in order to make them appear legitimate.  The marketing strategy developed by Huebner and Coenen included requiring prospective members in the non-existent hedge funds to join the BH Group and purchase a certain quantity of Iraqi dinar from Huebner, according to court documents.

Approximately $722,415.00 was solicited from prospective investors, according to court documents. 

Coenen also admitted he was not a former Marine who served in the first Gulf War, he had not been wounded in combat and he was never awarded a Purple Heart.  Coenen also admitted the defendants knowingly and intentionally made other false and misleading claims to investors in furtherance of the scheme to defraud, according to court documents.

Coenen and three others were indicted in September 2012.  Charges against the other co-defendants are pending.

Assistant United States Attorneys Joseph R. Wilson and Gene Crawford are representing the United States in this case, which was investigated by special agents of IRS, Criminal Investigation.

Nineteen separate federal indictments were unsealed today, charging 55 people with various violations of federal narcotics and/or firearms laws in and around Warren, Ohio, law enforcement officials announced.

At the same time, an additional 42 people were charged in state court on similar charges. Overall, 155 firearms were taken off the streets, either by being purchased or seized.

The conduct laid out in the indictments include a conspiracy involving 21 people who are accused of bringing large quantities of heroin, cocaine and crack cocaine from Detroit to Warren; another that brought heroin from Columbus to Warren and Dayton; others that sold Oxycodone, Hyrdrocodone, heroin and crack cocaine; and multiple indictments of people accused of illegally possessing and selling firearms.

“These cases have taken an arsenal off the streets of Warren and cut off several pipelines of heroin, cocaine and other illegal drugs,” said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio. “It’s yet another demonstration of what happens when federal and local law enforcement work together for the good of the public.”

“The job of protecting communities like Warren from violent crime as well as from violent criminals remain at the forefront for ATF and from law enforcement at all levels,” said ATF Special Agent in Charge Robin Shoemaker, Columbus Field Division. “We can assure you that these types of aggressive, proactive investigations will continue.”           

DEA Special Agent in Charge Robert L. Corso said: “This investigation exemplifies the success that can be achieved when local, state and federal law enforcement work together. Drug dealers are a violent group, and the nexus between drugs, guns and violence is clear in this case. The removal of the drugs, guns and the people who sell them, from the streets of Warren is a significant victory for law enforcement and will benefit those who live and work in that community.”

“Those arrested today brought more than just drugs and guns into the Youngstown area,” said Attorney General Mike DeWine.  “Their operation brought more violent crime into our neighborhoods as well, and we will continue to work with state, local, and federal law enforcement to do everything we can to keep our communities safe.”

“Today’s arrests are the result of the law enforcement community answering to the request and needs of the City of Warren,” said Warren Police Chief Timothy Bowers. “Amazing things can happen when we work together for a common goal.”

Most of the alleged crimes took place last year. A full list of people charged in federal court, with their hometowns and ages, is below.

In the case of United States v. Valentino Thomas, Sr. et. al., a 99-count indictment was filed charging 21 people with engaging in a conspiracy to distribute heroin, crack cocaine and cocaine. Thomas, Sr. obtained the drugs from suppliers in Detroit and then sold them to Anthony Ector, who in turn sold the drugs to at least 15 dealers in Warren, according to the indictment.

As part of the conspiracy, Lewis Powell II, of Warren, is charged with 14 counts of illegally possessing firearms, and faces additional charges for having body armor and firearms with obliterated serial numbers, according to the indictment.

Prosecutors are seeking to forfeit more than $31,000 and six firearms seized in that investigation.
In the case of United States v. Jamie Hancock, et. al., a 49-count indictment was filed charging nine people with engaging in a conspiracy to distribute heroin. Hancock, Cornelius Butler III and Jovan Hancock purchased kilogram quantities of heroin from a supplier in Columbus, and then sold the heroin to other dealers in Warren, Dayton and elsewhere, according to the indictment.

Prosecutors are seeking to forfeit more than $54,000 and a Honda motorcycle seized in that investigation.

Ricky and Henry Walker, both of Warren, are charged with conspiracy to deal firearms. The Walkers operated a flea market in Warren and purchased firearms, then bartered with flea market customers and sold firearms in exchange for items such as furniture, according to the indictment.

For example, Henry Walker sold nine firearms to a flea market customer in exchange for furniture on Sept. 7, 2011. One month later, he sold 22 firearms and ammunition to a customer in exchange for furniture and other property, according to the indictment.

Antonio Tucker, 22, of Warren, is charged with six counts – three charges of distributing Oxycodone or Hydrocodone and three firearms charges, including unlawfully distributing firearms, receiving or selling a stolen firearm and having a firearm with an obliterated serial number.

Margaret Devore and David Martin are charged with distributing Oxycodone and heroin and possessing a Norinco, model SKS rifle, despite both having previous felony convictions.

Donta Murray is charged with distributing crack cocaine and possessing two shotguns, despite a previous felony conviction.

Overall, 21 people face federal firearms charges as part of the indictments unsealed today.

If convicted, the defendants’ sentences will be determined by the court after review of the federal sentencing guidelines and factors unique to each case, including the defendant’s prior criminal record, if any, the defendant’s role in the offenses and the characteristics of the violations.

The cases are being prosecuted by Assistant U.S. Attorneys Daniel J. Riedl and David M. Toepfer, following investigations by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Drug Enforcement Administration, the TAG Task Force, the Ohio Bureau of Criminal Investigation and Identification, the Warren Police Department, the Trumbull County Sheriff’s Office, the U.S. Marshal’s Service, the Youngstown Police Department and the Ravenna Police Department.

An indictment is only a charge and is not evidence of guilt.  A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.

U.S. v. Valentino Thomas, Sr. et.al.
All 21 defendants are charged in count 1 with conspiracy to possess with intent to distribute heroin, crack cocaine and cocaine.
Valentino Thomas, Sr., 41, Detroit, distribution of heroin (x3), use of a phone in commission of a felony.
Anthony L. Ector, Jr., 29, Warren, distribution of heroin (x21), use of a phone in commission of a felony (x21).
Derrick Peete, 22, Detroit, distribution of heroin (x2), use of a phone in commission of a felony.
Lewis C. Powell II, 33, Warren, distribution of heroin (x4), distribution of crack cocaine, felon in possession of a firearm (x14), possession of a firearm with an obliterated serial number (x2), unlawful dealing of firearms, felon in possession of body armor, use of a phone in commission of a felony.
Bobby Covington, 26, Warren, distribution of heroin (x3), use of a phone in commission of a felony (x4).
Brian Thomas, 31, Detroit, distribution of heroin (x2).
Quintus Sellers, 24, Warren, distribution of heroin (x3).
Hosea Willis, 21, Warren, distribution of heroin (x3), use of a phone in commission of a felony.
Valentino Thomas, Jr., 22, Warren, distribution of heroin (x2), use of a phone in commission of a felony.
Jawan Thomas, 40, Warren, distribution of heroin (x2).
Bret Jones, 30, Bristolville, distribution of heroin (x4), interstate travel in commission of a felony.
Chance Wells, 22, Warren, distribution of heroin, use of a phone in commission of a felony (x3).
Bryan Sennyk, 33, Warren, use of a phone in commission of a felony (x3).
Toni Angelo, 49, Warren, distribution of crack cocaine, use of a phone in commission of a felony (x5).
Tracie Liptrot, 28, distribution of heroin (x2).
James Cohen, 24, Detroit, distribution of crack cocaine, felon in possession of a firearm.
Ahman McCollum, 28, Warren, use of a phone in commission of a felony (x3).
Stephanie McMahan, 29, Warren, use of a phone in commission of a felony (x3).
Sidney McMahan, 30, Warren, use of a phone in commission of a felony (x4).
Valerie Maddox, 30, Ravenna, use of a phone in commission of a felony (x2)
Benjamin Blakeley IV, 26, use of a phone in commission of a felony (x3).

U.S. v. Jamie Hancock et. al.
All nine defendants charged in count 1with conspiracy to possess with intent to distribute heroin.
Jamie Hancock, 27, Dayton, distribution of heroin (x14), use of a phone in commission of a felony (x26).
Cornelius Butler III, 32, Warren, distribution of heroin (x10), use of a phone in commission of a felony (x9).
Jovan Hancock, 30, Dayton, use of a phone in commission of a felony (x4).
Lakeia Harris, 30, Dayton, use of a phone in commission of a felony (x6).
DeShawn Brown, 36, Warren, distribution of heroin (x3).
Charles Moore II, 31, use of a phone in commission of a felony (x2).
Wayne Sims Jr., 31, Columbus, use of a phone in commission of a felony (x4).
Vincent Croff, 29, Warren, use of a phone in commission of a felony (x2).
April Polk, 29, Columbus, use of a phone in commission of a felony (x5).

U.S. v. Marcus Hemmingway et. al.
All five defendants charged in count 1 with conspiracy to possess with intent to distribute crack cocaine.
Marcus Hemmingway, 36, Warren: distribution of crack cocaine (x5), felon in possession of a firearm.
Darnell Defrance, 26, Warren, distribution of crack cocaine (x10).
Timothy Hooks, 45, Hermitage, Penn. distribution of crack cocaine.
Brittany Swogger, 24, Warren distribution of crack cocaine (x4).
James Court, Sr., 56, Girard, distribution of crack cocaine.

Other cases: Leon Glover Jr., 20, of Warren: unlawful dealing in firearms, possession of a stolen firearm.
John Wayne Provitt Jr., 23, Warren: conspiracy to possess with intent to distribute crack cocaine, distribution of crack cocaine (x8).
Derrick McCullough, 32, Youngstown: conspiracy to possess with intent to distribute crack cocaine, distribution of crack cocaine.
Antonio Tucker, 21, of Warren: distribution of Oxycodone (x3), unlawful dealing in firearms, possession of a stolen firearm, possession of a firearm with an obliterated serial number.
Dwayne Bruce, 23, Warren: felon in possession of ammunition.
Margaret Devore, 32, Ashtabula: distribution of Oxycodone (x3), felon in possession of a firearm.
David Martin, 28, Warren: felon in possession of a firearm.
George Gutierres, 23, Youngstown: felon in possession of a firearm.
Brian Henry, 18, Warren: felon in possession of a firearm.
Hector Hernandez, 45, Cortland: felon in possession of a firearm (x2).
Calvin Cole, 51, Warren: felon in possession of a firearm.
Edward Lightning, 29, Youngstown: felon in possession of a firearm.
William McCree: 34, Warren: prohibited person in possession of a firearm.
Allen McGill, 26, Warren: distribution of cocaine (x3), distribution of crack cocaine, prohibited person in possession of a firearm (x2).
Donta Murray, 36, Warren: distribution of crack cocaine, felon in possession of a firearm (x2).
Ted Murray, 39, Warren: felon in possession of a firearm.
John Slade, 23, East Liverpool, felon in possession of a firearm.
Ricky Walker, 54, Warren: conspiracy and dealing firearms without a license, felon in possession of a firearms, possession of an unregistered firearm, possession of a firearm with an obliterated serial number.
Henry Walker, 60, Warren: conspiracy and dealing firearms without a license, aiding and abetting a felon in possession of a firearms, possession of an unregistered firearm, possession of a firearm with an obliterated serial number.
Goodwin Lofton, 48, Warren: felon in possession of a firearm.

A Cuyahoga Falls man was sentenced to three years in prison after previously pleading guilty to possessing five pipe bombs, a silencer, a machine gun and marijuana, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.

David Dougherty, age 49, pleaded guilty in January to one count each of unlawful possession of destructive devices (five pipe bombs), possession of a firearm (the silencer), possession of a machine gun and one count of manufacturing of marijuana with intent to distribute.

On Oct. 20, 2012, Dougherty had five destructive devices consisting of a pipe, end caps, explosive powder and a pyrotechnic fuse, according to the court documents.

He also possessed a silencer, a STEN 9 mm submachine gun with no serial number and marijuana, according to the court documents.

The case was handled by Assistant United States Attorney Kelly Galvin  following investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Summit Count Bomb Squad and the Cuyahoga Falls Police Department.           

An Indiana man was sentenced to 20 years in prison for hate crimes stemming from the arson of the Islamic Center of Greater Toledo, law enforcement officials announced today.

U.S. District Judge Jack Zouhary sentenced Randolph Linn, 52, of St. Joe, Indiana. Linn pleaded guilty in December to three counts: (1) intentionally defacing, damaging and destroying religious real property because of the religious character of that property; (2) using fire to commit a felony and (3) using and carrying a firearm to commit a crime of violence.

 “Defendant Randy Linn attempted to burn down a mosque because of the religion of its members,” said Deputy Assistant Attorney General for the Civil Rights Division Roy L. Austin Jr.  “The Civil Rights Division will continue to partner with the FBI and U.S. Attorney’s Offices around the country to ensure that anyone who desecrates or burns a place of religious worship because of the creed practiced there is brought to justice.”

Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, said: “Hate crimes like this seek to damage more than buildings, they take aim at our American way of life. But today’s 20-year prison sentence and the coming together of this community to support our Muslim neighbors show that our freedoms are stronger and more resilient than this man’s hatred.”

Stephen D. Anthony, Special Agent in Charge of the Federal Bureau of Investigation’s Cleveland office, said: “We are pleased that Randall Linn got a significant sentence for his destructive act of setting fire to a sacred place of worship. The FBI, along with its federal, state, and local law enforcement partners, remains committed to protecting the rights of all citizens to practice their chosen religion by enforcing the laws that defend those liberties.”

“This sentence is the culmination of the tireless efforts of so many agencies to bring this case to justice,” said Robin Shoemaker, Special Agent in Charge, Columbus Field Division, Bureau of Alcohol, Tobacco, Firearms and Explosives. “Criminal damage to a house of worship is taken very seriously by ATF.”

According to court documents, Linn left his home on Sept. 30, 2012, in a red four-door Chevrolet Sonic. Inside the vehicle were numerous firearms and three red gas cans.

Linn stopped at a gas station near Perrysburg, Ohio, and filled the three gas can, then drove to the Islamic Center of Greater Toledo. Linn made numerous efforts to enter the Islamic Center before gaining entry. He walked through several rooms with a handgun in his left hand before exiting, then returning with a red gas can, according to court documents.

Linn then entered the prayer room on the second floor and poured gasoline on the prayer rug, a large Oriental-style rug used by members of the Islamic Center during prayer services. He then set fire to the prayer rug, according to court documents.

Linn acknowledges he intentionally set the fire because of the religious character of the Islamic Center property, according to court documents.

Linn agrees to pay restitution and understands that the amount may exceed $1 million due to the amount of fire and water damage sustained by the Islamic Center, according to court documents.

This case is being prosecuted by Assistant U.S. Attorneys Bridget M. Brennan, Ava Dustin and Special Assistant U.S Attorney Gwen Howe-Gebers.

This case was investigated by the Perrysburg Township Police Department, the State of Ohio Fire Marshal, the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Federal Bureau of Investigation.

A man who lives in Orange, Ohio, admitted to overbilling Medicaid and Medicare by more than $2.5 million, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.

Divyesh “David” C. Patel, age 39, pleaded guilty to one count of conspiracy to commit health care fraud and four counts of health care fraud. Patel is expected to be sentenced later this year.

“This defendant enriched himself and his company by flouting rules designed to protect the public,” Dettelbach said.

“Mr. Patel defrauded the tax payers by scamming Medicaid and Medicare,” said Stephen D. Anthony, Special Agent in Charge of the FBI’s Cleveland office. “Waste, fraud and abuse take critical resources out of our health care system and contribute to the rising cost of health care for all Americans.” 

Patel was the owner and president of Alpine Nursing Care, Inc., located at 4753 Northfield Road, Suite 5, North Randall, Ohio, employed Belita Mable Bush, as the office manager and director of provider services from June 1, 2006 through October 18, 2009, according to court documents.

Patel and Alpine employed Bush to prepare and submit the billings to Medicaid and Medicare for reimbursement for services provided by Alpine as a home health care provider, even though Patel knew that Bush had been previously convicted of a health care-related felony that excluded Bush from being involved in any way with Alpine’s Medicaid and Medicare billings, according to court documents. 

In addition to the fact that Bush was excluded from handling Alpine’s medical billings, Patel was aware that Bush falsified documents related to health care services allegedly provided to home health patients where the services were never provided, or were provided by home health aide that had previous criminal convictions that excluded them from providing health services in people’s houses, according to court documents. 

As a result of the conspiracy, Medicaid and Medicare suffered a loss of approximately $2,564,392, according to court documents.

Bush was convicted on related charges and is scheduled to be sentenced May 28.

The defendant's sentence will be determined by the court after review of factors unique to this case, including any prior criminal record, the defendants’ role in the offense, and the characteristics of the violation.  In all cases, the sentence will not exceed the statutory maximum and, in most cases it will be less than the maximum.

This case is being prosecuted by Assistant U.S. Attorney Mark S. Bennett and Special Assistant General Constance A. Nearhood, following an investigation by the Office of the Inspector General, Department of Health and Human Services, Cleveland, Ohio; Ohio Attorney General’s Office, Medicaid Fraud Control Unit; and the Federal Bureau of Investigation, Cleveland, Ohio.

If you suspect health care fraud, waste or abuse, please report it by calling HHS Office of Inspector General at 800-447-8477, the Centers for Medicare & Medicaid Services at 800-633-4227, or the FBI Cleveland Field Office at (216) 522-1400.  To learn more about health care fraud prevention and enforcement go to www.medicare.gov.

Ronald Jason Azar, age 34, of Cuyahoga Falls, Ohio, was sentenced to 18 months in prison in connection with his recent conviction for trafficking in more than $180,000 worth of counterfeit merchandise, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.

Azar pleaded guilty in October to a one-count indictment charging him with trafficking in merchandise containing counterfeit trademarks, logos or labels.

On or about April 27, 2011, Azar intentionally trafficked and attempted to traffic in approximately 104 counterfeit designer handbags which, if genuine, were valued at approximately $183,488, according to court documents.

The handbags included 12 Gucci, 23 Coach, 17 Louis Vuitton, five Versace, five Chanel, two Marc Jacobs, three Dooney & Burke, six Prada, eight Fendi, seven Chloe, seven Jimmy Choo and nine Dolce & Gabbana handbags, which contained counterfeit marks, logos, labels, hang tags, patches, stickers, emblems, holograms and packaging. The marks on the merchandise were identical to and substantially indistinguishable from marks used on genuine merchandise, and were in use and registered for such goods on the principle register of the United States Patent and Trademark Office, according to court documents.

The use of such counterfeit and spurious marks was likely to cause confusion, mistake or to deceive, according to court documents.

This case was prosecuted by Assistant U.S. Attorney Robert W. Kern, Cybercrime Coordinator for the Cleveland U.S. Attorney’s Office, following an investigation by the Cleveland Office of the Department of Homeland Security, Office Immigration and Customs Enforcement.

Several Ohioans have been found guilty and sentenced for violating federal tax laws over the past few months, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, and Denise Rocawich, Acting Special Agent in Charge of the IRS-Criminal Investigation, Cincinnati Field Office.
As the 2013 tax filing deadline approaches, these cases serve as reminders that there are civil and sometimes criminal penalties to filing erroneous tax returns.

“Tax day is not fun, but the vast majority of Americans who properly report and pay their fair share need to know that we will aggressively prosecute those who shirk or flaunt their obligations,” Dettelbach said.

“With the April 15 tax deadline looming, it is important for people to have confidence that when they pay their taxes, their neighbors and competitors will do the same,” Rocawich said. “Every time someone in America cheats on their taxes, there are over 300 million victims.”

Details on a few cases over the past year:

Nelida I. Velasco of Chardon was sentenced last year to more than three years in prison for conspiracy to make false claims, making false claims, misuse of Social Security account numbers, and aggravated identity theft.  A co-defendant, David T. Tufts, also of Chardon, was previously sentenced to 4 years imprisonment.  Both pleaded guilty to the charges, which involved the filing of at least 35 false tax returns claiming at least $155,000 in false refund claims using stolen identification information of the 35 purported claimants.

Aesha Johnson of Beachwood was sentenced last year to 21 months in prison for making false income tax refund claims totaling approximately $84,244 for tax clients.

John W. Hufgard of Bath was sentenced in February to 18 months imprisonment for attempting to evade approximately $397,659 of his personal income tax liabilities for 2007 through 2009.  The taxes were owed on unreported income Hufgard received from selling manufacturing racks to metal scrap dealers for cash.  Hufgard pleaded guilty to the charges in November 2012.

Steven R. Hinz, Heather L. English, Patricia A. Polk, and William E. Phillips, III were sentenced in earlier this year prison for conspiracy and making false claims for income tax refunds.  Led by Hinz, the conspiracy involved filing at least 17 false tax returns claiming refunds totaling more than $3 million based on fictitious amounts of tax withholdings under the so-called “OID process.”  All four defendants pleaded guilty in October 2012.  Hinz, formerly of Youngstown, was sentenced to nine years in prison, while English was sentenced to 2 1/2 years.

Brandon M. Mace of Canton pleaded guilty in February to two counts of making false claims for income tax funds totaling nearly $5.5 million.  Mace prepared and filed false tax returns containing those claims while incarcerated in Ohio on state charges.  Mace is scheduled to be sentenced in May.

A five-count indictment was filed charging David Donadeo, age 39, formerly of Broadview Heights, Ohio, and Dennis Boyles, age 39, of Garfield Heights, Ohio, with conspiracy to commit mail fraud and conspiracy to commit money laundering, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.

Boyles was also charged with two counts of tax evasion and one count of making or subscribing a false tax return.

Joseph Palazzo (who was previously charged, see Case No. 1:13cr167, United States District Court for the Northern District of Ohio) during the period in question was employed by the Cuyahoga Heights School District (the “District”) as its Information Technology (“IT”) Director.  Palazzo was responsible for managing the District’s IT Department, which included purchasing hardware and software and making other IT expenditures to benefit the District and its students, according to the indictment. 

Palazzo, Donadeo, Boyles, and others devised a scheme to divert millions of dollars of District funds to their own personal use. As a result of the conduct of Palazzo, Donadeo, Boyles, and others, the District was defrauded and sustained a total loss of at least $3,333,448, according to the indictment.

This scheme involved Palazzo submitting to the District for payment false invoices that purported to be for IT-related goods and services purchased from legitimate companies by the District’s IT Department to benefit the District.  Palazzo represented that the invoices he submitted were legitimate, and he approved the false invoices himself or forged the signature of another in the approval section, according to the indictment.

However, in truth and in fact, these invoices were for services never performed, fictitious software and hardware, and software and hardware never received or already purchased by the District from another source.  The companies named on the invoices did not supply such goods to or perform such services for the District and were nothing more than “shells,” according to the indictment.

Relying on these invoices, the District issued checks to these shell vendor corporations, which were established and owned by Donadeo, Boyles, and another person working with Palazzo to defraud the District.  Donadeo, Boyles and the other shell vendor corporation owner kept approximately half of the stolen money themselves and funneled the remainder of the money back to Palazzo for his personal use, according to the indictment. 

In addition to participating in the foregoing scheme to defraud the District, Boyles failed to report his share of the money that he received from the scheme on his tax returns for the tax years 2008, 2009, and 2010.  As a result, he failed to pay a total of $30,064 in taxes that was due and owing for those years, according to the indictment.

This case was investigated by Special Agents of the Internal Revenue Service Criminal Investigation and the Federal Bureau of Investigation, both located in Cleveland, with the assistance of the State of Ohio Auditor’s Office, the Cuyahoga County Sheriff’s Office, and the United States Postal Inspection Service.

If convicted, the defendants’ sentences will be determined by the Court after review of factors unique to this case, including the defendants’ prior criminal record, if any, the defendants’ roles in the offense, and the characteristics of the violation.  In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.          

The case is being prosecuted by Assistant United States Attorney Rebecca Lutzko, Special Assistant United States Attorney Perry Mastrocola, and Assistant United States Attorney James L. Morford.

An indictment is only a charge and is not evidence of guilt.  A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.

A Mansfield man was sentenced to more than four years in prison for making threats to courthouses in Nebraska, Washington, Oregon, Tennessee and Mississippi, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, and Stephen D. Anthony, Special Agent in Charge of the Cleveland Division of the Federal Bureau of Investigation for the Northern District of Ohio.

Lonny L. Bristow, 39, pleaded guilty today to with six counts of willfully making threats. He admitted to calling in bomb threats in November and December 2012.

U.S. District Judge Dan Aaron Polster sentenced Bristow to 51 months in prison. 

Bristow made the threats using prepaid calling cards that purchased at the Wal-Mart Supercenter in Upper Sandusky, Ohio, according to court documents.   Bristow had purchased several pre-paid calling cards and those pre-paid calling cards were linked to the false bomb threats placed to various courthouses spanning five states, according to court documents.

"These threats caused fear and panic throughout courthouses around the country," Dettelbach said.         "The FBI did a tremendous job in piecing this case together."

"Lonny Bristow induced panic in hundreds of people across several states who were simply trying to do their work," Anthony said.  "The FBI will continue efforts to aggressively pursue charges against anyone, such as Mr. Bristow, who chooses to make reckless and malicious bomb threats."

The case is being prosecuted by Assistant United States Attorney Thomas Getz after an investigation by agents of the Federal Bureau of Investigation.

A Lorain man was indicted today on charges of being a felon in possession of firearms after he was found with 40 handguns and rifles, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.

Jose Romero, age 32, was found to have 40 pistols, rifles and revolvers despite having a 2005 conviction in Lorain County for domestic violence, according to the indictment.

“This office places a high priority on keeping firearms out of the hands of those who are forbidden by law from obtaining them,” Dettelbach said. “Whether it is a person using a gun to commit a violent crime, a felon illegally obtaining a firearm or a straw purchaser trying to circumvent the law, we will aggressively pursue those who would violate our nation’s firearms laws.”

Romero told a confidential informant that he was interested in purchasing large numbers of firearms in an effort to influence their availability in Lorain, according to court documents.

The information indicated that Romero stores many of his firearms inside a safe inside his grandmother’s residence on Charleston Avenue in Lorain. Law enforcement officers subsequently searched Romero’s home on East 31st Street and the Charleston Avenue home on Feb. 26, 2013, according to court documents.

Investigators found firearms, marijuana and cocaine at the East 31st Street residence and a safe with 28 firearms at the Charleston Avenue residence, as well as marijuana, according to the court documents.

If convicted, the defendant’s sentence will be determined by the court after a review of factors unique to this case, including the defendants’ prior criminal record, the defendants’ roles in the offense and the characteristics of the violation. The sentence will not exceed the statutory maximum and in most cases will be less than the maximum.

This case is being handled by Assistant United States Attorney Robert F. Corts following an investigation by the Lorain Police Department, the Drug Enforcement Administration, Lorain County Drug Task Force and Bureau of Alcohol, Tobacco, Firearms and Explosives.

An indictment is only a charge and is not evidence of guilty. The defendants are entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.

A Galion, Ohio, man was sentenced to more than a decade in federal prison after previously pleading guilty to a child-pornography charge, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.

Richard Cooper, age 32, was sentenced last week to 121 months in prison by U.S. District Judge Sara Lioi. He pleaded guilty in October 2012 to one count of receipt and distribution of visual depiction of minors engaged in sexual activity.

“Protecting our children from predators is a priority of this office and the Department of Justice,” Dettelbach said. “The evidence found here by the FBI and Galion Police Department is profoundly troubling, and this defendant deserves to be behind bars.”

Stephen D. Anthony, Special Agent in Charge of the Federal Bureau of Investigation’s Cleveland office, said: “Richard Cooper possessed an alarming amount of child pornography and must be held accountable. The FBI, along with our law enforcement partners, is committed to protecting children from predators.”

On Oct. 12, 2011, Galion police officers executed a search warrant and discovered 47 videos and approximately 772 images of child pornography being shared by Cooper’s computer, and an additional 644 additional images of possible child pornography recorded on two compact discs, according to court records.

A subsequent forensic examination of the computers and CDs revealed 1,416 images of child pornography and 47 videos depicting child pornography. The videos and images include children, some as young as four months, engaged in sexual acts with other minors and adults, including humiliating, sadistic conduct, according to court records.

This case is being prosecuted by Assistant U.S. Attorney Michael A. Sullivan following an investigation by the Galion Police Department and Federal Bureau of Investigation, Mansfield Office.

A federal grand jury in returned a two-count indictment charging Lloyd A. Devore, Jr., age 53, of Dennison, Ohio, with receiving and distributing visual depictions of minors engaged in sexually explicit conduct, and possessing child pornography, Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.

The indictment charges from on or about February 15, 2013, through on or about March 13, 2013, Devore knowingly received and distributed computer files, which files contained visual depictions of real minors engaged in sexually explicit conduct. Additionally, the indictment charges that on March 13, 2013, Devore possessed a computer containing child pornography.

If convicted, the defendant’s sentence will be determined by the court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.

This case is being prosecuted by Assistant United States Attorney Michael A. Sullivan. The case was investigated by the Canton office of the Federal Bureau of Investigation and the Canton Police Department.

An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.

A Youngstown woman was sentenced to 3 1/2 years in prison and ordered to pay nearly $55,000 in restitution for using false identities to defraud health benefit plans , United States Attorney Steven M. Dettelbach said.

Shari Spencer, 42, previously pleaded guilty to three counts: theft from a health-benefit program, aggravated identity theft and making false statements.

The following description of Spencer’s crimes come from court documents:

Professional Benefits Administrators (“PBA”) was a third-party administrator of health care benefit plans.  PBA’s main office was located in Cuyahoga Falls, Ohio, and it had a branch office in Austintown, Ohio.  The defendant, SHARI L. SPENCER (“SPENCER”), was employed by PBA in various capacities from 2000 until she left in September 2010, when PBA went into receivership.  Spencer was the office manager of PBA’s Austintown office from 2008.

PBA had a number of clients with whom it contracted to provide third-party administration services in relation to the health care benefit plans that the clients sponsored for their employees.  Those clients included Northern Ohio Medical Specialists (“NOMS”) and Community Health Care, Inc. (“CHC”).

NOMS

NOMS was the sponsor of the Northern Ohio Medical Specialists Employee Health Benefit Plan - HSA Plan, a self-funded health care benefit plan for the benefit of NOMS’ employees (the “NOMS Health Benefit Plan”).  PBA was the third-party adminstrator for the NOMS Health Benefit Plan.  PBA was responsible for processing and adjudicating the health benefit claims of NOMS employees and for paying those claims from a bank account at Village Bank (Blain, MN), which PBA held in trust for NOMS (“NOMS Health Benefit Plan Trust Account”). 

NOMS also contracted with an insurance carrier, TPAC, to provide “stop-loss” insurance coverage in relation to the NOMS Health Benefit Plan.  Under the agreement, NOMS paid the health benefit claims of NOMS employees up to a certain, agreed-upon aggregated amount for all employees.  If the combined health benefit claims of NOMS employees exceeded that amount, the stop-loss coverage kicked in, and TPAC was responsible for paying the excess NOMS employee health benefit claims.

To facilitate the collection and making of such stop-loss payments, PBA submitted claims in excess of NOMS’ aggregate claims amount to TPAC.  TPAC, in turn, set up an account at Village Bank such that anytime claims exceeded NOMS’s share, TPAC’s account automatically deposited funds in the amount of the required stop-loss payment into the NOMS Health Benefit Plan Trust Account.  (As a technical matter, the TPAC account was similar to an overdraft protection account for the NOMS Health Benefit Plan Trust Account.)  PBA then prepared checks drawn on the NOMS Health Benefit Plan Trust Account and sent them to the provider in question to pay the claim.

SPENCER had access to the names, addresses, social security numbers, employee numbers, and other personal identification information of NOMS employees, and to other NOMS Health Benefit Plan information.  SPENCER also had access to the PBA claims system and to information relating to the NOMS Health Benefit Plan Trust Account.

CHC

PBA was also the third-party administrator services in relation to the self-funded health benefits plan that CHC sponsored for its employees. 

Like NOMS, CHC also contracted with an insurance carrier to provide stop-loss insurance coverage for the health benefit claims of CHC employees, but CHC used Trustmark, not TPAC.  Under the agreement, CHC paid the health benefit claims of its employees up to a certain agreed-upon amount.  If the health benefit claims of CHC employees exceeded that amount, the stop-loss coverage kicked in, and Trustmark was responsible for paying the excess health benefit claims of CHC employees, which it did by making stop-loss payments directly to CHC.  

To get stop-loss coverage, CHC was required to provide certain information to Trustmark about its employees and their prior health claims and claims history (“disclosure information”).  Trustmark based the premium it charged to CHC for the stop-loss coverage on this disclosure information, and the enforceability of the stop-loss coverage was subject to proper disclosures being made to Trustmark.  PBA was responsible for compiling and providing any and all disclosure information relating to CHC employees to Trustmark such that the stop-loss coverage would be in force and cover any excess claims.  SHARI L. SPENCER was the sole person responsible for handling this disclosure information for CHC and transmitting it to Trustmark.

The Scheme

Using personal identification information for NOMS employees and/or their covered spouses, Spencer manufactured and submitted two separate fake medical claims for stop-loss payments to TPAC, purportedly on behalf of NOMS.  Based on Spencer’s submissions, TPAC paid the claims and funded the NOMS Health Benefit Plan Trust Account even though no medical services were ever rendered in either case.  Spencer then diverted the funds from the NOMS Health Benefit Plan Trust Account to other uses. 
In the first instance, Spencer diverted $54,809.38 to CHC to cover up Spencer’s failure to provide the proper disclosure information to Trustmark (CHC’s stop-loss carrier), which failure had resulted in Trustmark denying a $54,809.38 claim for a CHC employee.   In the second instance, Spencer caused a check in the amount of $21,014.83 to be issued to “S.L. SPENCER HSPT,” which she signed and deposited into her own bank account.

This case was prosecuted by Assistant U.S. Attorneys Rebecca Lutzko and John Siegel following an investigation by the Department of Labor, Employee Benefits Security Administration and Office of Inspector General.

Five members of a Sandusky family were charged in a three-count indictment related to skimming more than $1.8 million in cash from three restaurants the family operates in the Sandusky area and depositing the cash at numerous financial institutions, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.

Indicted are: Haralambos Gonos, age 52; Andreas Gonos, age 28; Chris Gonos, age 31; Kryiakos Gonos, age 30, and Sofia Skoura, age 52. 

In count one – conspiracy to structure financial transactions to evade filing currency transaction reports -- Haralambos Gonos, Andreas Gonos, Chris Gonos, and Kryiakos Gonos are accused of taking large amounts of cash from Dianna’s Deli, Dianna’s and The Depot and making multiple deposits of cash just under the $10,000 threshold, for the purpose of evading the filing of a Currency Transaction Report. The conduct took place between 2007 and 2009, according to the indictment.

Count two charges that Haralambos Gonos and an unindicted co-conspirator conspired to structure financial transactions to evade filing Form 8300 between March 2010 and November 2011. Specifically, Gonos purchased a 2007 Mercedes and 2005 Porsche Cayenne motor vehicles by using combinations of cash and multiple cashier’s checks, according to the indictment.

Count three charges Haralambos Gonos and Sofia Skoura conspiring to engage in bulk cash smuggling in an attempt to transport currency to a place outside the United States on or about January 31, 2013. Specifically, they are accused of attempting to transport more than $14,700 to Greece, where they maintain a residence, according to the indictment.

"These defendants are accused of avoiding bank regulations," Dettelbach said.

“It is IRS-CI’s responsibility when investigating financial institution fraud to focus on the flow of the money which ultimately leads us to the beneficiaries of this illegal activity,” said Denise Rocawich, Acting Special Agent in Charge, IRS Criminal Investigation. 

If convicted, the defendants’ sentences will be determined by the Court after reviewing factors unique to this case, including the defendants’ prior criminal record, if any, the defendants’ role in the offense and the characteristics of the violation.  In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.

The investigating agencies in this case are the Internal Revenue Service, Toledo, Ohio the Department of Homeland Security, Dearborn, Michigan, , ICE Homeland Security Investigations, Detroit, Michigan, and the U.S. Customs and Border Protection, Detroit, Michigan.  The case is being handled by Assistant United States Attorney Joseph R. Wilson.

An indictment is only a charge and is not evidence of guilt.  Defendants are entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.

Raymone “Ramone” Clements was found guilty following a jury trial of one count each of being a felon in possession of a firearm and being a felon in possession of ammunition, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.

U.S. District Judge Donald Nugent scheduled sentencing for June 13.

Clements, 42, of Cleveland, was found to have one round of .357-caliber ammunition and two rounds of .22-caliber ammunition on Dec. 20, 2012 and a Rossi, Model Garrucha, .22-caliber Derringer, serial number 307228, on Jan. 17, 2013. Clements had this ammunition and firearm despite previous convictions in the Cuyahoga County Court of Common Pleas for rape (2006), drug trafficking (2003) and aggravated robbery (1991).

“This case demonstrates why rapists and other felons are forbidden from having firearms,” Dettelbach said. “Whether is a person using a gun to commit a violent crime, a felon illegally obtaining ammunition or a straw purchaser trying to circumvent the law, we will aggressively pursue those who would violate our nation’s firearms laws.

“We will continue to work side by side with our federal, state, county and local law enforcement partners to make sure those individuals who illegally possess firearms and/or ammunition are held accountable for their actions,” said ATF Special Agent in Charge Robin Shoemaker, Columbus Field Division. 

Witnesses testified during the trial that Clements shot a dog in a public park in Cleveland Heights. That incident led investigators to search his residences, where they found the ammunition and firearm, according to court testimony.

This case is being prosecuted by Assistant U.S. Attorneys Kelly L. Galvin and Margaret Sweeney following an investigation by Bureau of Alcohol, Tobacco, Firearms and Explosives and Cleveland Heights Police Department.

An indictment was filed charging Mickael C. Jones, age 36, of Bowling Green, Ohio, with taking approximately $14,000 from the Department of Veterans Affairs, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.

Mickael Jones’ aunt died in May 2009. She had been receiving monthly VA surviving-spouse pension benefits. Not knowing of her death, the VA continued to make monthly direct deposits into her bank account, and Jones withdrew the money for his for his own use, according to the indictment.

From May 2009 to December 2010, Jones converted to his own approximately $14,000 of VA benefits, to which he was not entitled, according to the indictment.

If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to each case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.

The investigating agency in this case is the Department of Veterans Affairs, Office of Inspector General. The case is being handled by Assistant United States Attorney Thomas A. Karol.

An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.

A criminal information was filed charging a Walbridge, Ohio, man with falsely labeling a package containing wildlife items, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio

Mark St. John, age 53, falsely labeled an elephant ivory shipment destined for an overseas buyer on June 1, 2011, according to the information.

If convicted, the defendant’s sentence will be determined by the court after reviewing factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.

The investigating agency in this case is the United State Fish & Wildlife Service, Delaware, Ohio. The case is being handled by Assistant United States Attorney Gene Crawford.

An information is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.

Four Akron residents have been indicted for their roles in a conspiracy in which some used fake G.E.D. certificates to enroll in the University of Akron and fraudulently obtain more than $104,000 in financial aid, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.

Lori A. Martin, age 46, Raheem J. Martin, age 40, Teresa K. Scott, age 34, and Tina M. Mileca, age 34, are charged with conspiracy to commit mail fraud and wire fraud.

“These defendants cut corners to get money to which they were not entitled,” Dettelbach said. “Our office will continue to prosecute those who defraud the federal government.”

The defendants conspired to obtain federal student financial aid money to which the recipients were neither eligible nor entitled by creating and submitting fake Official Transcripts falsely reporting General Educational Development test results and the awarding of G.E.D. certificates for persons who had not earned and did not have such certificates, according to the indictment.

The defendants submitted these fake documents to the University of Akron to gain admission to the university and, thereby, access to the federal funds.  The defendants used the grant and loan money they received to pay for living expenses and other personal expenditures, as well as costs associated with attending the University of Akron, according to the indictment.

The conspiracy took place from August 2006 through September 2011, according to the indictment.
Lori Martin created fake Official Transcripts that reported test results and the awarding of G.E.D. certificates for Raheem Martin, Scott and Mileca. She also helped them complete online applications to the University of Akron and student aid, according to the indictment.

Scott and Mileca each paid $200 each to Lori Martin for the fake G.E.D. Official Transcript, according to the indictment.

Lori and Raheem Martin obtained more than $76,100 in Pell Grants and federally insured loans from these activities. Scott received more than $23,800 in Pell Grants and federally insured loans while Mileca obtained at least $4,600, according to the indictment.

As a result of the conspiracy, the Department of Education was defrauded and sustained a total loss of at least $104,611, according to the indictment.

This case was investigated by Special Agents of the Department of Education, Office of Inspector General, located in Ann Arbor, Michigan, and the University of Akron Police Department, with the assistance of the Akron Police Department.

If convicted, the defendants’ sentences will be determined by the Court after review of factors unique to this case, including the defendants’ prior criminal record, if any, the defendants’ roles in the offense, and the characteristics of the violation.  In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.          

The case is being prosecuted by Assistant United States Attorney Rebecca Lutzko.

An indictment is only a charge and is not evidence of guilt.  A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.

A federal grand jury returned a one-count indictment charging a Cleveland woman with conspiracy to possess with intent to distribute Oxycodone, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.

Charmin Reeves, age 35, is accused of stealing 10 blank prescriptions from an area hospital where she worked. She filled one out one prescription for 90 pills of Oxycontin in November 2009 and sold the other nine blank prescriptions for $900, according to the indictment.

"Prescription drug abuse is a huge problem throughout Ohio," Dettelbach said. "We will continue to work with our law enforcement partners to push back against this trend."

If convicted, the defendant’s sentence will be determined by the court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.

This case is being prosecuted by Assistant United States Attorney Michael L. Collyer. The case was investigated by the Cleveland branch of the Federal Bureau of Investigation and the Cleveland Police Narcotics Unit.

An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.

A nine-count criminal information was filed charging an Aurora, Ohio, man with crimes related to a scheme of at least $225,000 involving construction projects, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, and Stephen D. Anthony, Special Agent in Charge of the Federal Bureau of Investigation’s Cleveland office.

Robert J. Berryhill, 51, is accused of creating a fictitious company as a way to divert money on construction projects for his own personal use, including the restoration of a vintage Corvette sports car he had purchased, according to the information.

Berryhill, who served as the senior vice president of Carnegie Management and Development Corp. (CMDC) in Westlake, Ohio, is charged with five counts of mail fraud, two counts of wire fraud, and one count each of aggravated identity theft and false personation of an officer or employee of the United States.

“This defendant is accused of abusing the trust of his employer, his colleagues and his customers in an effort to enrich himself,” said Dettelbach. “He is accused of using public contracts as a way to get his Corvette restored and his pockets lined with hundreds of thousands of dollars.”

“Robert Berryhill is accused of creating false businesses, false invoices and ultimately pretending to be an FBI employee, all in a desperate attempt to defraud others out of at least $225,000,” Anthony said. “The FBI remains committed to detecting and stopping those defrauding others.”

Knoxbi Company, LLC, which was managed by CMDC, won the bid to build an FBI office in Knoxville, Tennessee in August 2007. The company used Blaine Construction Company to serve as the on-site general contractor, according to the information.

In March 2009, Indy-Fedreau LLC, which was also managed by CMDC, won the bid to construct an FBI building in Indianapolis. The company used Welty Building Company as the general contractor, according to the information.

At the same time, Berryhill also created a fictitious contractor known as American Excavators Company (AEC) for the purpose of submitting false invoices to divert CMDC monies to his personal use, according to the information.

From August 2008 through September 2009, Berryhill defrauded CMDC, Knoxbi, Indy-Fedreau, Blaine and Welty to obtain money. He did this by creating false invoices in the name of Ore Enterprises – the Pennsylvania company Berryhill hired to restore his vintage Corvette – and then submitted them to Blaine and Welty. Those companies paid the invoices then passed the cost on to Knoxbi and Indy-Fedreau for final payment, according to the information.

Berryhill also created false invoices in the name of AEC that he submitted to Blaine and Welty. Those companies paid AEC and then passed the cost of the invoice to Knoxbi and Indy-Fedreau for final payment, according to the information.

Overall, Berryhill caused an actual loss of at least $225,919.

Berryhill is also accused of falsely pretending to be an FBI employee identified as “W.C.M.” on July 28, 2008, and demanding that Blaine pay an invoice from Ore regarding the construction of an FBI building in Knoxville, according to the information.

The case resulted from an investigation conducted by Federal Bureau of Investigation.  The case was handled by Assistant United States Attorney Robert J. Patton.

If convicted, the defendant’s sentence will be determined by the court after review of factors unique to this case, including the defendant’s prior criminal record (if any), the defendant’s role in the offenses and the characteristics of the violations.  In all cases, the sentences will not exceed the statutory maximum and in most cases they will be less than the maximum.

An information is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.

Jeffrey J. Reichert was sentenced to one year and one day in prison for for violating the Digital Millennium Copyright Act, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.

Reichert, age 27, of Northwood, Ohio, was found guilty earlier this year following a jury trial before U.S. District Judge Donald C. Nugent.

On April 3, 2012, a federal grand jury returned a one-count indictment charging Reichert with knowingly manufacturing, importing, offering to the public, or otherwise trafficking in technology, products, services, devices, components or parts thereof, which were primarily designed to circumvent technological measures designed to effectively control access to a work copyrighted under Title 17 of the United States Code, for purposes of commercial advantage or private financial gain.

Specifically, the defendant was charged with trafficking in modification chips (also known as “Mod Chips”) which are primarily designed to circumvent the technological measures designed into video game consoles (such as the Nintendo Wii) to prevent access to copyrighted works.

This case was prosecuted by Assistant U.S. Attorneys Robert W. Kern and Chelsea Rice of the Cleveland U.S. Attorney’s Office, following an investigation by the Cleveland Office of the Department of Homeland Security, Immigration and Customs Enforcement (ICE).

Cleveland-area businessman Michael Forlani was sentenced to more than eight years in prison after previously pleading guilty to RICO conspiracy and other crimes related to bribes Forlani paid to public officials in exchange for help getting contracts for companies he owned or controlled, federal law enforcement officials said today.

U.S. District Judge Sara Lioi sentenced Forlani, age 55, of Gates Mills, to 97 months in prison. She also ordered him to forfeit $900,000 and pay $136,251 in restitution -- $95,129 to Cuyahoga County, $37,144 to the Maple Heights City School District and $3,978 to Metro Health Systems.

Forlani pleaded guilty last year to RICO conspiracy, Hobbs Act violations, conspiracy to commit wire fraud and honest services wire fraud, and other charges.

Forlani was president and majority owner of Doan Pyramid LLC, a minority owner in Neteam, AVI, the sole member of Veterans Development, LLC, a member of the board of managers for Veterans Development Domiciliary, LLC, the sole member of Wade Park Retail, LLC, and the sole owner fo Deep Three Partners, LLC, according to court documents.

Between 2002 and 2009, Forlani conspired with Jimmy Dimora, Santina Klimkowksi, John Carroll and other public officials in exchange for those officials using their positions to benefit Forlani and his associated companies, according to court documents.

Those actions included awarding and executing public business, expediting and influencing official actions pending before public agencies and other actions, according to court documents.

This included the Cuyahoga County Commissioners voting to award Doan a $941,000 contract to install emergency generators at the Justice Center; requesting and obtaining Dimora’s assistance related to contracts at the Juvenile Justice Center project; getting Dimora’s assistance related to influencing board members on a RTA contract valued at more than $1.1 million, the appointment of a member to the Port Authority Board, getting a county economic development loan, getting no-bid contracts at Maple Height City Schools, and construction contracts and subcontracts at MetroHealth Medical Center, among other actions, according to court documents

In return, Forlani and his associated companies provided things of value to the public officials, such as discounted home improvements, installation of televisions and an outdoor audio/visual system, loge seats for concerts, sporting event tickets, meals and drinks, and other things of value, according to court documents.

The case was prosecuted by Assistant United States Attorneys Antoinette T. Bacon, Henry DeBaggis and Nancy L. Kelley following an investigation by the FBI, IRS – Criminal Investigation and the Department of Veterans Affairs – Office of Inspector General.

A grand jury returned a five-count indictment charging Danette M. Stevenson, 37, with two counts of theft of government property and three counts of making false statements, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.

The indictment alleges that Stevenson stole and converted to her own use, approximately $38,130.63 in Social Security payments made to her that she was not entitled to receive.

The indictment further alleges that Stevenson stole and converted to her own use approximately $14,156.00 in Housing Choice Voucher Program (commonly referred to as Section 8) benefits that she was not entitled to receive.

The indictment further alleges that Stevenson made false statements in connection with applications for Social Security and Housing benefits.

If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation.  In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.

The case is being prosecuted by Assistant U.S. Attorney Phillip J. Tripi and Trial Attorney Richard T. Hamilton, Jr., following investigation by agents of the Social Security Administration, Office of Inspector General and the United States Department of Housing and Urban Development, Office of Inspector General.

An indictment is only a charge and is not evidence of guilt.  A defendant is entitled to a fair trial in which it will be the government's burden to prove guilt beyond a reasonable doubt.

Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, today announced that a grand jury returned a four-count indictment charging Hamadoun Bacoco Samassekou, age 29, of Parma, Ohio, with three counts of Fraud and Misuse of Visa Permits, Melissa A. Davis, age 23, of Cleveland, Ohio, with two counts of Fraud and Misuse of Visa Permits, and Chella A. Davis, age 21, of Cleveland, Ohio, with one-count of False Statements to federal officers.

The indictment alleges that Hamadoun Bacoco Samassekou, and Melissa A. Davis, knowingly made false statements with respect to an I-130 Petition for Relative Alien by falsely impersonating and representing that Melissa Davis was Samassekeo’s wife.

The indictment further alleges that Samassekou and Melissa A. Davis knowingly made false statements under oath with respect to an interview regarding Samassekou’s immigration status, by falsely personating and representing that she was the wife of Samassekou.

The indictment further alleges that Samassekou made false statements or representations regarding his I-485 Application by answering “No” to a question about whether he knowingly committed any crime of moral turpitude or drug offense.

The indictment further alleges that Chella A. Davis, knowingly made a material false statement to immigration officers by stating that she was never married to Samassekou when in truth and fact she was.
If convicted, the defendants’ sentence will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation.  In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.

The case is being prosecuted by Assistant U.S. Attorney Phillip J. Tripi, and Trial Attorney Richard T. Hamilton, Jr., following investigation by agents of the Immigration and Customs Enforcement, Homeland Security Investigations.

An indictment is only a charge and is not evidence of guilt.  A defendant is entitled to a fair trial in which it will be the government's burden to prove guilt beyond a reasonable doubt.

Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, today announced that a grand jury returned a five-count indictment charging Kevin Philip Zeszut with one count of theft of government property; charging Ohio Transport Corporation with one count of aiding and abetting the theft of government property and charging William C. Hill, Jr., with one count of aiding and abetting the theft of government property and four counts of making false statements. 

Zeszut, 60, lives in Parma, Ohio; Hill, 59, lives in Liberty Township, Ohio and Ohio Transport Corporation is located in Middletown, according to public records.

The indictment alleges that Zeszut stole and converted to his own use, $196,245 in Social Security payments and related benefits to which he was not entitled.

The indictment further alleges that Hill made false statements to agency representatives by stating that Zeszut was not an employee of his company, Ohio Transport Corporation, when, in fact, Hill knew that Zeszut was a full-time employee of his company, but was being paid using the actual name and Social Security number of a person other than Zeszut.

If convicted, the defendants’ sentences will be determined by the Court after a review of factors unique to this case, including the defendants’ prior criminal records, if any, the defendants’ role in the offense and the characteristics of the violations.  In all cases, the sentences will not exceed the statutory maximums, and in most cases they will be less than the maximum.

The case is being prosecuted by Trial Attorney Ian D. Hoffman and Assistant U.S. Attorney Phillip J. Tripi, following investigation by agents of the Social Security Administration Office of Inspector General.
An indictment is only a charge and is not evidence of guilt.  A defendant is entitled to a fair trial in which it will be the government's burden to prove guilt beyond a reasonable doubt.

A criminal information was filed charging a Mansfield man with six counts of willfully making threats, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, and Stephen D. Anthony, Special Agent in Charge of the Cleveland Division of the Federal Bureau of Investigation for the Northern District of Ohio.

Lonny L. Bristow, 39, is accused of calling in bomb threats to courthouses in Nebraska, Washington, Oregon, Tennessee and Mississippi beginning in November throughout the month of December 2012. 

Bristow made the threats using prepaid calling cards that purchased at the Wal-Mart Supercenter in Upper Sandusky, Ohio, according to the information.   Bristow had purchased several pre-paid calling cards and those pre-paid calling cards were linked to the false bomb threats placed to various courthouses spanning five states, according to the information.

"These threats caused fear and panic throughout courthouses around the country," Dettelbach said.         "The FBI did a tremendous job in piecing this case together."

"Lonny Bristow induced panic in hundreds of people across several states who were simply trying to do their work," Anthony said.  "The FBI will continue efforts to aggressively pursue charges against anyone, such as Mr. Bristow, who chooses to make reckless and malicious bomb threats."

The case is being prosecuted by Assistant United States Attorney Thomas Getz after an investigation by agents of the Federal Bureau of Investigation.

If convicted, the defendant’s sentence will be determined by thecCourt after a review of factors unique to the case, including the defendant’s prior criminal record, if any, the defendant’s role in the offenses, and the characteristics of the violations. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.

An information is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.

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The Department of Justice announced today that it has entered into a consent decree with Summit County, Ohio, and related parties, which if approved by the court, will resolve a sex discrimination lawsuit in which the United States intervened in June 2012. 

The United States joined a lawsuit brought in the U.S. District Court for the Northern District of Ohio by 21 female deputy sheriffs at the Summit County Jail who claimed they were subjected to discrimination due to a sex-segregated job assignment system implemented at the jail in January 2012. The United States’ complaint in intervention alleged that this system discriminated against female deputies because of their sex and constituted a pattern or practice of sex discrimination in violation of Title VII of the Civil Rights Act of 1964.  As a result of this discriminatory practice, the United States alleged female deputies lost the job assignments and shifts they had earned based on their seniority as well as opportunities to bid on overtime postings.  

“Bringing an end to practices in the law enforcement community that discriminate against women is a major priority of the Justice Department and the Civil Rights Division.  Practices that facially discriminate on the basis of sex that cannot be justified under the law, like the job assignment system used by Summit County, present a major hurdle to workplace equality that the Justice Department will not ignore,” said Jocelyn Samuels, Principal Deputy Assistant Attorney General, Civil Rights Division. 

In July 2012, shortly after the United States joined the lawsuit, Summit County abandoned its sex-segregated job assignment system. Under the terms of the consent decree, Summit County has agreed to take several steps to ensure that any job assignment system implemented at the Summit County Jail will comply with Title VII and only use sex-based assignments, if at all, to the limited extent that they are reasonably necessary to the normal operation of the jail. 

To make this determination, the county will conduct a staffing analysis and develop a lawful staffing plan, which it will review regularly during the life of the decree.  The county will also provide training on sex discrimination as well as engage in recruitment efforts to encourage qualified female applicants to apply for deputy positions. 

Finally, the county will pay $400,000 in individual monetary relief to the affected female deputies and to cover their attorney fees.

“This agreement ensures that female deputies at the Summit County Jail will have the opportunity to do the same jobs as their male counterparts,” said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio. “We will continue to press for equality for women in the workplace.”

This is the first pattern or practice lawsuit brought by the Justice Department as a result of a joint project with the Equal Employment Opportunity Commission (EEOC) designed to ensure vigorous enforcement of Title VII against state and local governmental employers by enhancing cooperation between the EEOC and the Civil Rights Division.  Enforcement of federal employment discrimination laws is a top priority for the Justice Department with this case being handled by attorneys assigned to both the Civil Rights Division and the U.S. Attorney’s Office for the Northern District of Ohio.

“Our partnership with Department of Justice allows for the strategic investigation and efficient resolution of discrimination claims in the public sector,” said EEOC District Director Spencer H. Lewis Jr., of the EEOC Philadelphia District Office.   The Philadelphia District Office of the EEOC oversees Pennsylvania, Maryland, Delaware, West Virginia and parts of New Jersey and Ohio. 

Title VII prohibits discrimination in employment on the basis of gender, race, color, national origin or religion, and prohibits retaliation against an employee who opposes an unlawful employment practice, or because the employee has made a charge or participated in an investigation, proceeding or hearing under the act. More information about Title VII and other federal employment laws is available on the Department of Justice website at www.usdoj.gov/crt/emp/index.html.

The EEOC enforces federal laws prohibiting employment discrimination.  Further information about the EEOC is available on its website at www.eeoc.gov.

Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, today announced that a federal grand jury sitting in Cleveland, Ohio, returned a one-count indictment charging Andre M. Little, age 27, of Hubbard, Ohio, with possession with the intent to distribute heroin.

The indictment charges that on or about February 13, 2013, Andre M. Little possessed with the intent to distribute more than 1,000 grams of heroin.

If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violations. In all cases, the sentences will not exceed the statutory maximum and, in most cases, it will be less than the maximum.

The investigation preceding the indictment was conducted by the Drug Enforcement Administration - Youngstown Resident Office. The matter is being prosecuted by Assistant United States Attorney David M. Toepfer.

An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.

A three-count information was filed charging a former employee of the Cuyahoga Heights School District with crimes related to the theft of more than $3.4 million from the district, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.

Joseph M. Palazzo, age 31, of Independence, Ohio, was charged with conspiracy to commit mail fraud, conspiracy to commit money laundering, and wire fraud.

“This defendant is accused of lining his pockets with millions of dollars intended to be used to educate the children of the Cuyahoga Heights School District,” Dettelbach said. “Our office will continue to go after those who would abuse the public trust.”

“This investigation uncovered a multi-million dollar embezzlement scheme laced with a web of financial lies that left a local school district in financial peril,” said Denise Rocawich, Acting Special Agent in Charge, IRS Criminal Investigation, Cincinnati Field Office.

“Joseph Palazzo violated the trust that the citizens and students of Cuyahoga Heights had placed in him by funding his personal account with millions of their tax dollars,” said Stephen D. Anthony, Special Agent in Charge of the FBI’s Cleveland Office. “The investigators are to be commended for uncovering this enormous fraud.”

Palazzo was employed by the Cuyahoga Heights School District as its Information Technology Director until February 2011.  Palazzo was responsible for managing the District’s IT Department, which included purchasing hardware and software and making other IT expenditures to benefit the District and its students, according to the information. 

Palazzo devised a scheme to divert millions of dollars of District funds to his personal use and the personal use of others.  This scheme involved Palazzo submitting to the District for payment false invoices that purported to be for IT-related goods and services purchased from legitimate companies by the District’s IT Department to benefit the District.  Palazzo represented that the invoices he submitted were legitimate, and he approved the false invoices himself or forged the signature of another in the approval section, according to the information.

However, these invoices were for services never performed, fictitious software and hardware, and software and hardware never received or already purchased by the District from another source.  The companies named on the invoices did not supply such goods to or perform such services for the District and were nothing more than “shells,” according to the information.

Palazzo’s actions caused the District to issue checks to these shell vendor corporations, which were established and owned by others working with Palazzo who are not named in the information.  The shell vendor corporation owners, in turn, kept approximately half of the stolen money themselves and funneled the remainder of the money back to Palazzo for his personal use, according to the information.

As a result of the conduct of Palazzo and his unnamed co-conspirators, the District was defrauded and sustained a total loss of at least $3,333,448, according to the information.

Palazzo also engaged in a second scheme to defraud the District.  It involved Palazzo purchasing various personal electronic items, such as I-Pads, cameras, and televisions, from legitimate District vendors.  Palazzo then altered the invoices from such purchases to falsely reflect that classroom items, such as digital microscopes, projectors, and laptops, had been purchased for the District and submitted those invoices to the District for payment.  Upon receipt of these personal electronic items, Palazzo sold them to third-parties at a discounted price and kept the money from such sales for his own personal use, according to the information.

As a result of the Palazzo’s conduct in the second scheme, the District was defrauded and sustained an additional loss of at least $76,214, according to the information.

This case was investigated by Special Agents of the Internal Revenue Service Criminal Investigation and the Federal Bureau of Investigation, both located in Cleveland, with the assistance of the State of Ohio Auditor’s Office and the United States Postal Inspection Service.

The case is being prosecuted by Assistant United States Attorney Rebecca Lutzko, Special Assistant United States Attorney Perry Mastrocola, and Assistant United States Attorney James L. Morford.

If convicted, the defendant’s sentence will be determined by the court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense, and the characteristics of the violation.          

An information is only a charge and is not evidence of guilt.  A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.

A federal grand jury returned a three-count indictment charging Samuel Oaks, age 61, of Rootstown, Ohio, with improperly stored high explosives, possession of an unregistered firearm, and possession of a firearm with an obliterated serial number, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.

Count 1 of the indictment charges that on or about December 4, 2012, Oaks knowingly, improperly and illegally stored nine Dupont electronic detonators/blasting caps, at a Rootstown, Ohio, residence.

Counts 2 and 3 of the indictment charge that on or about December 19, 2012, Oaks possessed a FMJ, model M-11/Nine, 9mm submachine gun, which was not registered to him in the National Firearms Registration and Transfer Record, and which submachine gun had an obliterated serial number.

If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violations. In all cases, the sentences will not exceed the statutory maximum and, in most cases, it will be less than the maximum.

The investigation preceding the indictment was conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives - Youngstown Field Office. The matter is being prosecuted by Assistant United States Attorney David M. Toepfer.

An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.

Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, announced that Kelly Prigmore was indicted on two counts of making and subscribing false federal income tax returns for the years 2006 and 2007.

According to court records, Prigmore, 42, resides in Akron, Ohio.

The indictment alleges that Prigmore worked as a self-employed home health care provider for a client who paid her for live-in 24 hour services. Prigmore allegedly filed joint personal income tax returns on which she omitted approximately $209,601 of her home health care service income.

For 2006, she reported total income of $8,600 and omitted additional income of approximately $96,806. For 2007, she reported total income of $8,990 and omitted additional income of approximately $112,795, according to the indictment.

If convicted, Prigmore’s sentence will be determined by the court after review of factors unique to this case, including her prior criminal record, if any, her role in the offenses, and the characteristics of the violations. In all cases the sentence will not exceed the statutory maximum and in most cases they will be less than the maximum.

This case is being prosecuted by Special Assistant United States Attorney Perry D. Mastrocola and Assistant United States Attorney John Siegel, following an investigation by the Internal Revenue Service, Criminal Investigation, Akron, Ohio.

An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.