Southern District of Ohio

COLUMBUS – Jason C. Kozlowski, 32, of Glen Rock, Pennsylvania, was sentenced in U.S. District Court to 12 years in prison and 20 years supervised release for traveling interstate with the intent to engage in illicit sexual conduct and receiving child pornography.

Carter M. Stewart, United States Attorney for the Southern District of Ohio, Grove City Police Chief Steve Robinette, Pickaway County Sheriff Robert B. Radcliff, and members of the Franklin County Internet Crimes Against Children (ICAC) Task Force announced the plea entered into today before Chief U.S. District Judge Edmund A. Sargus, Jr.

According to court documents, on October 10, 2014, Grove City police officers observed Kozlowski in his vehicle behind a Target store nude from the waist down with a 15-year-old female.

Upon interviewing Kozlowski and the minor female, investigators discovered the two had been communicating since approximately March of 2014 by Facebook, e-mails, text messages and telephone calls.  Text messages found on the phones of Kozlowski and the minor female revealed that Kozlowski had sent the girl sexually explicit messages.  Kozlowski was aware of the female’s age and the laws in the state of Ohio regarding consent.

Kozlowski told law enforcement officials the 15-year-old was going to get a letter from her parents giving him permission to “be with” with the girl. The defendant admitted to driving from Pennsylvania to Ohio to pick up the female and explained they went to dinner, shopping, and then parked behind the Target store and engaged in sex acts.

Investigators discovered nude photographs of both the defendant and the victim had been exchanged vita text. They also discovered pornographic images of a different, 13-year-old female on Kozlowski’s computer.

Kozlowski pleaded guilty to traveling interstate with the intent to engage in illicit sexual conduct and receiving child pornography in February 2015.

The Franklin County ICAC Task Force is a multi-agency effort dedicated to the fight against computer facilitated crimes against children. The following agencies are members:

Franklin County Sheriff’s Office                            Upper Arlington Police Department
Grove City Police Department                               Columbus Police Department
Grandview Heights Police Department              Whitehall Police Department
Hilliard Police Department                                      Westerville Police Department
Homeland Security Investigations                       U.S. Secret Service
Ohio ICAC                                                                        Franklin County Prosecutor's Office

This case was brought as part of Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse.  Led by the U.S. Attorneys Offices, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children, as well as identify and rescue victims.  For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov/.

U.S. Attorney Stewart commended the cooperative investigation by law enforcement, as well as Assistant United States Attorneys Heather Hill and Jessica Kim, who represented the United States in this case. 

COLUMBUS – Keith A. Arrick Sr., 47, of Ft. Mitchell, Kentucky was sentenced in U.S. District Court today to 13 years in prison for sex trafficking by force, fraud or coercion.

Carter M. Stewart, United States Attorney for the Southern District of Ohio, Ohio Attorney General Mike DeWine and members of the Central Ohio Human Trafficking Task Force, including Marlon V. Miller, Special Agent in Charge, U.S. Homeland Security Investigations, Colonel Paul Pride of the Ohio State Highway Patrol and Columbus Police Chief Kim Jacobs announced the plea entered today before Senior U.S. District Judge Peter C. Economus.

The investigation by the Central Ohio Human Trafficking Task Force found that between September 2013 and February 2014, Arrick Sr. used various hotels in the Columbus area to harbor women, including a minor female, to engage in commercial sex acts for the financial benefit of the defendant. He recruited customers through internet websites by posting photos of the women or others who resembled the women, instructing the women how much to charge for the various acts then kept a portion of the money for himself, and provided the women with illegal narcotics, including heroin. The investigation found that one victim was brought to Columbus from Kentucky. Arrick Sr. used physical violence and threats of physical violence if the victims indicated they wished to stop performing commercial sex acts.

Arrick Sr. pleaded guilty to sex trafficking by force, fraud or coercion in September 2014.

Arrick Sr.’s son, Keith A. Arrick Jr., 22, of Columbus, Ohio pleaded guilty in July 2014 to sex trafficking of children. He was sentenced to10 years in prison.

U.S. Attorney Stewart commended the cooperative investigation by the Central Ohio Human Trafficking Task Force, which was formed in 2012 and is part of the Ohio Attorney General’s Ohio Organized Crime Investigations Commission, and which also includes authorities from the Attorney General's Bureau of Criminal Investigation (BCI), U.S. Homeland Security Investigations, Columbus Division of Police, Ohio State Highway Patrol, Powell Police Department, Federal Bureau of Investigation and the Delaware County Prosecutor's Office. Assistant U.S. Attorney Heather Hill is representing the government in this case.

CINCINNATI – Michelle M. Clemons, 32, of Independence, Ky., was sentenced in U.S. District Court to 30 months in prison for three counts of wire fraud.

Carter M. Stewart, United States Attorney for the Southern District of Ohio, and Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Field Division, announced the sentence handed down today by U.S. District Judge Michael R. Barrett.

According to court documents, beginning in or about July 2005, Clemons worked as the controller for Art Woodworking and Manufacturing Co. located in Cincinnati. From at least 2006 until February 2013, Clemons used wire communications to embezzle funds from Art Woodworking. During that time, she electronically transferred more than $411,000 from the company for her own financial benefit.

“As controller, the defendant oversaw payroll for the company, had access to its financial information and was responsible for directing funds for the payment of company debts,” Assistant United States Attorney Jessica Knight told the court. “Clemons abused her position of trust at Art Woodworking and began diverting unauthorized payroll and reimbursements to her personal bank account.”

Clemons would issue herself unauthorized payroll checks using the direct deposit function or through manual payroll checks deposited into her personal bank account. She also issued reimbursements for business expenses she did not incur. Clemons often manipulated the accounting software to make the checks she wrote to herself appear as if they were used for a business purpose, when in fact, Clemons was cashing or depositing the checks into her personal bank account.

Furthermore, she used three business credit cards in the name of Art Woodworking for personal expenses such as to fund a Disney Vacation Club and subsequent trip in Florida, and to pay her personal real estate tax bill.

Clemons was also sentenced to three years supervised release and ordered to pay restitution of $231,671.42 to Art Woodworking and $100,000 to Selective Insurance.

Clemons pleaded guilty on August 14, 2014 to wire fraud.

U.S. Attorney Stewart commended the cooperative investigation by the FBI, as well as Assistant United States Attorney Jessica Knight, who represented the United States in this case. 

DAYTON, Ohio – Terrence P. Young, 37, of Dayton, pleaded guilty in U.S. District Court to a charge of delay or destruction of mail, in violation of 18 U.S.C. § 1703(a). 

Carter M. Stewart, United States Attorney for the Southern District of Ohio, and Scott Balfour, Assistant Special Agent in Charge, U.S. Postal Service Office of the Inspector General, (USPS OIG), announced the plea entered into Tuesday before U.S. District Court Judge Walter H. Rice.

According to court documents, Young, a United States Postal Service carrier, stole Kroger coupons, a Kroger gift card, and a Walmart gift card from mail that had been entrusted to him to deliver.  He later used the gift cards at these stores to purchase personal items.  When law enforcement officers confronted him, he was found with a mail tub containing more than 200 pieces of first-class mail and approximately 178 pieces of presorted standard mail in the back of his personal car.

Young was employed by the United States Postal Service as a postal carrier from 2010 until March 2015, when he was terminated due, in part, to his theft of mail. His primary job function was to deliver mail along postal route 6, which falls within zip code 45417.

At least 11 customers made complaints at the P.L. Dunbar station in reference to their carrier not delivering their mail. The complaints were similar in nature in that residents advised they were not receiving any mail – including utility bills, business mail, pension checks, insurance correspondence, housing information, court documents and their children’s school information.

“Several customers advised that due to the non-receipt of their mail, they had utilities shut off, lost insurance, missed appointments and court dates, lost out on benefits for their children and were in the process of being evicted from their home without ever receiving notification through the mail,” Assistant United States Attorney Vipal Patel said. “Many had to pay penalties for late payments.”

The parties involved with this case have agreed to a sentencing range of at least one year probation and up to 10 months in prison. Sentencing has been scheduled for 10am on September 8, 2015.

U.S. Attorney Stewart commended the cooperative investigation by the USPS OIG, as well as Assistant United States Attorney Vipal Patel, who is representing the United States in this case. 

CINCINNATI – Four people involved in the operation of Advanced Family Medical Center and Watkins-Tsai Imaging in Coal Grove, Ohio were sentenced today for conspiracy to commit health care fraud. They improperly charged government insurance programs for medically unnecessary procedures, most of which were related to the overuse of a CT scan machine.

Carter M. Stewart, United States Attorney for the Southern District of Ohio, Ohio Attorney General Mike DeWine, Lamont Pugh III, Special Agent in Charge, U.S. Department of Health and Human Services Office of Inspector General, Bret Flinn, Resident Agent in Charge, Defense Criminal Investigative Service, and Antoinette V. Henry, Special Agent in Charge, U.S. Food and Drug Administration Office of Criminal Investigations, announced the sentences handed down today by U.S. District Judge Susan Dlott.  

Peter Tsai, 46, owner of Advanced Family Medical Center, his father and mother, Tahsiung Tsai, 74, and Ruey Tsai, 68, who owned Watkins-Tsai Imaging, and Peter Tsai’s cousin, Wei Lih Sheih, aka “Wendy”, 43, who worked for both clinics, had conspired to defraud health care benefit programs including Medicaid, Medicare and Tri-Care between 2004 and 2013 when they were indicted.

All four defendants pleaded guilty to conspiracy to commit health care fraud in August 2014 after four days of trial. Peter Tsai pleaded guilty to the illegal importing of a medical device, namely the purchase of Synvisc knee injections from Canada and Turkey.

Peter Tsai was sentenced to 78 months in prison for a conspiracy to commit health care fraud and the illegal importing of a medical device. For the conspiracy, Defendants Ruey and Tahsiung Tsai were sentenced to 3 years of supervised release, six months of house detention, and community service.  As part of the plea agreement, Ruey and Tahsiung Tsai were also required to pay $999,000 towards the restitution by today, which they did.  Defendant Wei Lih Sheih was also sentenced to 3 years of supervised release and 12 months of house detention for the conspiracy to commit health care fraud.  

According to court documents, both clinics operated out of the same building in Coal Grove. The conspirators performed numerous CT procedures that were unnecessary.  For example, Peter Tsai diagnosed most of his patients with a condition called piriformis syndrome in order to give injections guided by his CT scan machine. The defendants also performed unnecessary diagnostic CT scans that were medically unnecessary, including multiple scans of the same body part for the same patient weeks apart. They also performed and billed for CT scans for medically unnecessary injections of an osteoarthritis product, Synvisc, in knees, including injection into young adults without any proper diagnosis of osteoarthritis.  One patient received 85 CT-related scans in a 35-month period.

The defendants were also charged with fraudulently inflating their bills to Medicare and Medicaid.  Peter Tsai illegally imported misbranded Synvisc from other countries including Canada and Turkey, billed government insurance programs for the injections and transferred money into an account in a Canadian financial institution in order to buy the product.

Stewart commended the cooperative investigation by agents and officers of the agencies named above, as well as Assistant U.S. Attorneys Timothy Mangan and Timothy Oakley, who are representing the United States.

Anyone suspecting health care fraud, waste or abuse can report it by calling the U.S. Department of Health and Human Services, Office of Inspector General at 800-447-8477.  To learn more about health care fraud prevention and enforcement go to www.stopmedicarefraud.gov. Ohioans can report suspected instances of health care fraud to Attorney General DeWine’s office by calling 1-800-282-0515.

WASHINGTON – Fred Alverson, former Law Enforcement Coordinator and Public Information Officer of the U.S. Attorney’s Office in the Southern District of Ohio, was one of 160 members of the Department of Justice recognized by Attorney General Loretta Lynch, Deputy Attorney General Sally Quillian Yates, and Executive Office for U.S. Attorneys (EOUSA) Director Monty Wilkinson at the 31st Director’s Awards Ceremony today in Washington D.C.

The Southern District of Ohio was one of 31 districts represented at the ceremony which was held in the Great Hall at the Robert F. Kennedy Department of Justice Building.

"Our honorees include career executives and supervisors; Assistant U.S. Attorneys and Special Assistant U.S. Attorneys; appellate attorneys and law enforcement officials; administrators, paralegals, and public affairs officers," said Attorney General Lynch.  "These individuals, and so many others, have faced daunting and sometimes dangerous challenges.  They have dedicated their leadership and their expertise, their time and their energy, to the service of their mission.  And they have remained devoted, at all times, to the high ideals and deeply-held values that animate our country and our cause."

Alverson, a Hilliard, Ohio resident, was awarded for Superior Performance in Public Affairs. Prior to his retirement in August 2014, he served the U.S. Attorney’s Office Southern District of Ohio for nearly 20 years.

“Fred had an outstanding grasp of the priorities of the Department and the District, and was pivotal in promoting the mission of keeping our communities safe,” said U.S. Attorney Carter Stewart. “The District’s message, as delivered by Fred, was always clear, concise, direct and helpful.”

EOUSA provides oversight, general executive assistance, and direction to the 94 United States Attorneys’ offices around the country. For more information on EOUSA and its mission, visit http://www.justice.gov/usao.

COLUMBUS, Ohio – A United States District Court jury convicted three people of offering and accepting kickbacks as part of a public corruption conspiracy involving a Dayton, Ohio charter school.  Two defendants were public officials who ran the school and the other secured a lucrative consulting contract in exchange for bribes to school officials.  

Carter M. Stewart, United States Attorney for the Southern District of Ohio, Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Ohio Attorney General Mike DeWine whose office oversees the Ohio Bureau of Criminal Investigation (BCI), and Ohio Auditor Dave Yost announced the verdicts reached today which was returned following a trial that began on May 18, 2015 before U.S. District Judge Algernon L. Marbley.

The jury convicted Shane K. Floyd, 42, Strongsville, Ohio, who served as superintendent of Arise, Arise board chairman Christopher D. Martin, 44, Springfield, Ohio, and Carl L. Robinson, 47, Durham, North Carolina, who operated an educational consulting business called Global Educational Consultants.

According to court testimony, Floyd and Martin solicited and accepted bribes from Robinson in exchange for awarding a lucrative, unbid consulting contract to Global.  Arise paid Global $420,919 over 15 months starting in September 2008 at a time when Arise was in a financial crisis unable to pay other vendors and teachers pay and benefits were cut. In exchange for the consulting contract, Robinson paid Floyd and Martin large amounts of cash and other benefits, like an all-expense -paid Las Vegas trip taken by Martin.

All three were convicted of conspiracy, a crime punishable by up to five years in prison, and with federal programs bribery, which is punishable by up to 10 years in prison. In addition, Floyd and Martin were each convicted of one count of making false statements to the FBI, punishable by up to five years imprisonment.

The trio also faces a $420,919 forfeiture, which represents the amount of money derived from the crimes.

A co-defendant, Kristal N. Screven, also known as Kristal Allen, of Dayton, Ohio admitted her role as an Arise board chairman who was bribed by pleading guilty to conspiracy to commit federal programs bribery on May 8, 2015, before U.S. District Judge Marbley.

Arise! Academy was an Ohio Community School, commonly known as a charter school, which operated with federal funds provided through the state of Ohio.

U.S. Attorney Stewart commended the investigation by Special Agents of the FBI and Ohio BCI, who are a part of the FBI’s Public Corruption Task Force, as well as Assistant United States Attorneys Doug Squires and Peter Glenn-Applegate and Special Assistant United States Attorney Kim Robinson, who prosecuted the case.

COLUMBUS, Ohio – A federal grand jury in Columbus, Ohio has charged Mark Preston French, 40, of Westerville, Ohio, with scheming to defraud an elderly individual by advising the person to invest in gold and silver through him as an investment advisor, then keeping for himself money, gold, and silver from precious metals commodity transactions that were funded by the individual.

Carter M. Stewart, United States Attorney for the Southern District of Ohio, and Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Field Division, announced the indictment returned yesterday.

The indictment alleges that French acted as a broker for the victim, who was a client at a time when French worked at Investors Security Company, Inc.  French held himself out at an investment advisor for the elderly victim, who he advised to open with him joint bank accounts in their names so that French could receive funds for purchases of gold and silver.  Once French opened to those joint bank accounts the elderly victim transferred money to the accounts so that French could use the money to invest in precious metals, including gold and silver. He also had the elderly victim agree not to tell people about their investment arrangement.  

According to the indictment, after opening a joint checking account and a joint savings account with his victim, the defendant spent more than $1.3 million of the victim’s money to purchase gold and silver and have it delivered to French’s residence in Westerville.  French thereafter used the funds in the joint accounts to buy and sell gold and silver, while keeping some of the gold and silver for himself at his residence, and some of the profit from the transactions in his own personal bank accounts. 

French was charged in the indictment with five counts of wire fraud and two counts of mail fraud, each crime punishable by up to 20 years in prison, as well as with five counts of interstate transportation securities taken by fraud and four counts of money laundering, each crime punishable by up to 10 years in prison.

U.S. Attorney Stewart commended the investigation of this case by the FBI, and Assistant United States Attorney Dale Williams, who is prosecuting the case.

An indictment merely contains allegations, and the defendant is presumed innocent unless proven guilty in a court of law.

COLUMBUS, Ohio – A United States District Court jury convicted Antonio L. Sibley, 38, of Akron, Ohio with production of child pornography.

Carter M. Stewart, United States Attorney for the Southern District of Ohio, along with members of the Central Ohio Human Trafficking Task Force, including Ohio Attorney General Mike DeWine, Marlon V. Miller, Special Agent in Charge, U.S. Homeland Security Investigations, Colonel Paul Pride of the Ohio State Highway Patrol and Columbus Police Chief Kim Jacobs announced verdict reached today, which was returned following a trial that began on May 18 before U.S. District Judge Frost.

According to court testimony, in July 2014, while Sibley was harboring a 17-year-old girl in a motel room in Whitehall, Ohio, he took sexually explicit photographs of her and advertised her on internet websites for paid sexual services. Members of the Human Trafficking Task Force found the girl during an undercover operation on July 31, 2014, and thereafter found the pornographic photographs Sibley had taken on a phone that was in the motel room.  The victim testified that she and Sibley had been involved in a sexual relationship since she was 15 years old, and that Sibley had taken the pornographic photographs of her.  

“Cases such as this one highlight the importance of collaboration among various law enforcement agencies and with service providers like the Salvation Army,” said Assistant United States Attorney Heather A. Hill. “This case would not have been possible without all of the tremendous work of all of the members of the Human Trafficking Task Force, the Salvation Army, and the special assistance of Brant Cook, the director of the Ohio Attorney General’s Crimes Against Children Initiative.”

The jury convicted Sibley of production of child pornography, a crime punishable by a sentence ranging from a mandatory minimum 15 years in prison to 30 years in prison. The jury could not reach a verdict on a second charge of sex trafficking of a minor.

Sibley was arrested on August 11, 2014, by members of the Central Ohio Human Trafficking Task Force at the Casa Villa Motel in Whitehall, Ohio, and remains in custody. He was indicted on September 11, 2014.

U.S. Attorney Stewart commended the investigation of this case by the Central Ohio Human Trafficking Task Force, which was formed in 2012 and is part of the Ohio Attorney General’s Ohio Organized Crime Investigations Commission, also includes authorities from the Attorney General's Bureau of Criminal Investigation (BCI), Columbus Division of Police, Homeland Security Investigations (HSI), Powell Police Department, Federal Bureau of Investigation and the Delaware County Prosecutor's Office. Assistant United States Attorney Heather A. Hill and Special Assistant United States Attorney General Brant Cook represented the government in this case.

COLUMBUS, Ohio – Daniel J. Akehurst, 46, of Chillicothe, Ohio, was sentenced in U.S. District Court to 84 months’ imprisonment for possessing child pornography.

Carter M. Stewart, United States Attorney for the Southern District of Ohio, and members of the Franklin County Internet Crimes Against Children (ICAC) Task Force, announced the sentence handed down today by U.S. District Senior Judge George C. Smith.

According to court documents, in September 2013, investigators connected 59 images of child pornography to Akehurst’s IP address. The files depicted nude or partially nude pre-pubescent females, approximately one to seven years old, being sexually abused.

When a search warrant was executed at the defendant’s residence, ICAC Task Force officers discovered more than 16,000 images and videos of child pornography on a computer and thumb drive.

Akehurst pleaded guilty on December 22, 2014, to knowingly possessing visual depictions of child pornography.

The Franklin County ICAC Task Force is a multi-agency effort dedicated to the fight against computer facilitated crimes against children. The following agencies are members:

Franklin County Sheriff’s OfficeUpper Arlington Police Department Grove City Police DepartmentColumbus Police Department Grandview Heights Police DepartmentWhitehall Police Department Hilliard Police DepartmentWesterville Police Department Homeland Security InvestigationsU.S. Secret Service Ohio ICACFranklin County Prosecutor's Office

This case is being brought as part of Project Safe Childhood, a nationwide initiative by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorney's Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children as well as to identify and rescue victims.

U.S. Attorney Stewart commended the cooperative investigation by the Franklin County ICAC Task Force, as well as Assistant United States Attorneys Jessica H. Kim and Heather A. Hill, who are representing the United States in this case.

CINCINNATI, Ohio - Charles H. Sheehan III a/k/a “Duke Sheehan,” 69, of Cumming, Georgia was sentenced to 36 months in prison for his role in a securities fraud scheme, in which a Cincinnati company lost $1 million in investment funds.

Carter M. Stewart, United States Attorney for the Southern District of Ohio and Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Field Division, announced the sentence handed down by Judge Timothy S. Black.

According to court documents, Sheehan represented himself to be the President and CEO of a purported charity called the Southern Foundation for the Advancement of Arts and Education, Inc., based in Georgia. Sheehan promised a Cincinnati-based real estate development group that he would invest $1 million from the group along with funds from the Southern Foundation in a series of purported investments. However, rather than investing the $1 million that had been wired to the defendant, Sheehan distributed the funds to himself and others.

Sheehan pleaded guilty in November 2014 to defrauding investors with respect to the Southern Foundation and the use of the investor funds. He was ordered to pay restitution in the amount of $1 million. 

U.S. Attorney Stewart commended the investigation by the FBI, as well as Assistant United States Attorney Timothy Mangan, who represented the United States in this case. 

DAYTON, Ohio –Jack A. Manning, 61, of Troy, Ohio, pleaded guilty in U.S. District Court to producing child pornography and attempting to produce child pornography.

Carter M. Stewart, United States Attorney for the Southern District of Ohio, and Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Field Division, and Troy Police Chief Charles Phelps announced the plea entered into yesterday before U.S. District Judge Timothy S. Black.

In February 2014, the defendant knowingly coerced a child under the age of 10 to engage in sexually explicit conduct for the purpose of taking pictures of such conduct. According to court documents, “they were taken to gratify his own sexual desires.” In the same month, the defendant attempted to obtain a video of two minors engaging in sexually explicit conduct.  

Manning was arrested on October 3, 2014 and has been in custody since.

The parties involved in Manning’s case have agreed to a 25-year binding prison sentence, pending U.S. District Judge approval.

Manning is scheduled for sentencing on September 14, 2015 before U.S. District Judge Timothy S. Black.

This case was brought as part of Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse.  Led by the U.S. Attorneys Offices, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children, as well as identify and rescue victims.  For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov/.

U.S. Attorney Stewart commended the investigation of this case by the FBI and Troy Police Department, and Assistant United States Attorneys Kyle Healey and Vipal Patel, who are prosecuting the case.

COLUMBUS, Ohio – Rami Hisham Mohammad, 34, of Hilliard, Ohio, was sentenced in U.S. District Court to 18 months in prison and a $150,000 fine for trafficking in counterfeit goods.

Carter M. Stewart, United States Attorney for the Southern District of Ohio, and Marlon V. Miller, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI), announced the sentence handed down today by U.S. District Senior Judge James L. Graham.

According to court documents, Mohammad operated a retail clothing business in Columbus, Ohio known as Rock Star Fashions. Upon completing a federal search warrant on January 28, 2012, federal agents seized 1,063 pairs of Nike Air Jordan shoes and 4,408 pairs of Nike Air Swoosh shoes at Rock Star Fashions.

Mohammad pleaded guilty on September 15, 2014 to intentionally trafficking goods and knowingly using counterfeit marks in connection with the Nike “Swoosh” and “Air Jordan” marks. These marks were identical or substantially indistinguishable from genuine marks registered with the United States Patent Trademark Office.

Mohammad was also ordered to pay $7,939.62 in restitution to Nike for their investigative costs. The government also forfeited $35,828 in cash along with the entire inventory from the store.

U.S. Attorney Stewart commended the cooperative investigation by HSI, as well as Assistant United States Attorney Deborah Solove, who is representing the United States in this case. 

COLUMBUS, Ohio – A federal grand jury has charged Francois G. Toure, 25, of Reynoldsburg, Robert A. Kamara, 26, of Canal Winchester, and Enouch J. Kermue, 26, of Columbus, in a wire fraud conspiracy in an indictment returned in Columbus. Toure is also charged in a second wire fraud conspiracy, as well as a money laundering conspiracy. Additionally, Toure and Kamara are charged with aggravated identity theft.

Carter M. Stewart, United States Attorney for the Southern District of Ohio, Mark Porter, Special Agent in Charge, U.S. Secret Service, and Kathy Enstrom, Special Agent in Charge, Internal Revenue Service Criminal Investigation (IRS), announced the indictment returned yesterday.

The indictment alleges that from April 2012 through March 2015, the defendants knowingly conspired to commit wire fraud to defraud financial institutions and their customers. The three did so by producing, using, trafficking in and possessing stolen credit card numbers, knowing the credit card information was stolen from other individuals.

Toure, Kamara and Kermue allegedly obtained stolen credit card numbers over the Internet and used an encoding device to re-encode the magnetic strips of genuine prepaid/gift cards to reflect the stolen credit card numbers. It is alleged that they used the re-encoded cards to purchase merchandise. Banks suffered loss when they reimbursed their customers for unauthorized purchases.

The indictment alleges that the defendants used a convenience store’s merchant credit card processing accounts to redeem genuine prepaid/gift cards, knowing that the cards had been purchased with stolen credit card account information.  It is alleged that the store did not provide any legitimate goods or services in exchange for the value of the prepaid/gift cards.

Toure also allegedly engaged in a conspiracy that used stolen personally identifiable information to file fraudulent United States Individual Income Tax Returns, in an effort to obtain fraudulent refunds. It is alleged that Toure used counterfeit identification documents to open bank accounts, and that fraudulently obtained refunds were deposited into these accounts.

The defendants were charged with one count of conspiracy to commit wire fraud affecting a financial institution, a crime punishable by up to 30 years in prison.  Toure was also charged with one count of conspiracy to commit wire fraud and one count of conspiracy to commit money laundering, each punishable by up to 20 years in prison. Toure and Kamara are each also charged with one count of aggravated identity theft, which carries a mandatory sentence of two years in prison, to be served consecutive to any sentence for the other offenses.

“This investigation succeeded due to the cooperation of all the agencies in the Southern District of Ohio Task Force (SDOHTF), which was created in 2012 to prevent, detect and investigate various forms of electronic crimes,” U.S. Secret Service Special Agent in Charge Mark Porter said. “The SDOHTF is an electronic/financial crimes task force made up of 65 federal, state, and local agencies in the Columbus, Dayton and Cincinnati area. Furthermore, our partnership with the IRS’ Criminal Investigative Division in Ohio continues to produce arrests in high impact economic crimes across the state.”

“Stealing identities and filing false tax returns is a serious crime that hurts innocent taxpayers,” said Kathy A. Enstrom, Special Agent in Charge, IRS Criminal Investigation, Cincinnati Field Office.  “Today’s indictment, in cooperation with the U.S. Secret Service and the U.S. Attorney’s Office, should serve as a strong warning to those who are considering similar conduct.  Law enforcement is serious about investigating these crimes and holding those accountable who would defraud the government.” 

U.S. Attorney Stewart commended the investigation of this case by the Secret Service and IRS, and David J. Bosley and Peter K. Glenn-Applegate, who are prosecuting the case.

An indictment merely contains allegations, and the defendants are presumed innocent unless proven guilty in a court of law.

CINCINNATI – A federal grand jury has charged Bryan Barbarawi, 35, of West Chester, Ohio with committing money laundering and with filing a false currency transaction report in an indictment returned in Cincinnati.

Carter M. Stewart, United States Attorney for the Southern District of Ohio, Joseph P. Reagan, Special Agent in Charge, Drug Enforcement Administration (DEA) and Kathy A. Enstrom, Special Agent in Charge, Internal Revenue Service (IRS), Criminal Investigation, Cincinnati Field Office, announced the indictment that was unsealed on May 8, 2015 following the arrest of Barbarawi on May 7, 2015.

The indictment alleges that since February 2011 Barbarawi owned and operated a car dealership in Fairfield, Ohio under the names Nationwide Credit Solutions, LLC d/b/a Auto Max, Extreme Imports and Falcon Auto Sales, Inc.

Upon receiving more than $10,000 in cash in a trade or business, the trade or business is required to file a currency transaction report, specifically a Form 8300, with the Internal Revenue Service (IRS) or the Financial Crimes Enforcement Network (FINCEN) by the 15th day after the date the cash was received.

It has been alleged that in November 2014 Barbarawi committed money laundering by concealing the source and ownership of the proceeds from narcotics trafficking, as represented to Barbarawi by an undercover law enforcement officer, while conducting a financial transaction.

Also, in November 2014, it has been alleged that Barbarawi received approximately $21,533.50 in cash from two related transactions in connection with the sale of a vehicle and Barbarawi filed, and caused the employees of his car dealership to file, a false currency transaction report, Form 8300, Report of Cash Payments Over $10,000 Received in a Trade or Business.  Barbarawi falsely reported, and caused his employees to falsely report, the purchaser of the vehicle and the source of the funds used to purchase the vehicle.

Money laundering carries a maximum sentence of 20 years imprisonment and failing to file a currency transaction report carries a maximum sentence of five years imprisonment.

“Federal laws that regulate the reporting of financial transactions are in place to detect and stop illegal activities,” said Kathy A. Enstrom, Special Agent in Charge, IRS Criminal Investigation, Cincinnati Field Office. “IRS Criminal Investigation is committed to enforcing these laws and following the money, wherever it leads.”

Barbarawi was released on bond following his arraignment before U.S. Magistrate Judge Stephanie K. Bowman.

U.S. Attorney Stewart commended the investigation of this case by the DEA and IRS, and Assistant United States Attorneys Jessica W. Knight and Karl Kadon, who are prosecuting the case.

An indictment merely contains allegations, and the defendant is presumed innocent unless proven guilty in a court of law.

‘Work From Home’ Jobs Actually Fraudulent Scheme

CINCINNATI – Shawnell Evans, 28, of Cincinnati, pleaded guilty in U.S. District Court for operating an unlicensed money transmitting business.

Carter M. Stewart, United States Attorney for the Southern District of Ohio, and Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Field Division, announced the plea entered into today before U.S. District Senior Judge Sandra Beckwith.

Evans admitted to serving as a “money mule” for multiple fraudulent schemes through “work from home” jobs from approximately 2011 through 2013.  According to court documents, during that time, Evans received instructions from a variety of different individuals via email regarding transfers of money and goods in exchange for a payment to Evans.  Per the instructions, Evans would wait for money to show up on debit cards, transfer most of the money via Western Union or MoneyGram, and keep a percentage of the funds.

The defendant was also instructed to print fake company checks by downloading certain bank logos. On certain occasions, Evans received stolen credit cards as part of her money mule services and used the stolen credit cards.  Evans was warned by the FBI that she was participating in facilitating certain fraud rings, but even after the warnings, Evans continued to wire the fraudulent funds and help the schemes. 

Evans pleaded guilty to one count of knowingly conducting, controlling, managing, supervising, directing and owning all or part of an unlicensed money transmitting business, a crime punishable by up to five years in prison.

U.S. Attorney Stewart commended the cooperative investigation by the FBI, as well as Assistant United States Attorney Timothy Mangan, who is representing the United States in this case. 

WASHINGTON – Three California men and a Minnesota company were charged in an indictment today in the Southern District of Ohio for their roles in a massive prescription drug diversion scheme. 

The indictment alleges that David Jess Miller, 50, of Santa Ana, California; Artur Stepanyan, 38, and Mihran Stepanyan, 29, both of Encino, California, and Minnesota Independent Cooperative Inc. (MIC) engaged in a conspiracy to sell prescription drugs from illegal, unlicensed sources to wholesalers and pharmacies throughout the United States.  The 12-count indictment charges the defendants with conspiracy to commit mail and wire fraud, multiple counts of mail fraud, and conspiracy to distribute prescription drugs without a license and to make false statements.    

Principal Deputy Assistant Attorney General Benjamin C. Mizer of the Justice Department’s Civil Division, U.S. Attorney Carter M. Stewart of the Southern District of Ohio, Director George M. Karavetsos of the U.S. Food and Drug Administration (FDA)’s Office of Criminal Investigations and Assistant Inspector in Charge Christopher White of the U.S. Postal Inspection Service (USPIS) announced the charges. 

According to the indictment, from 2007 through April 2014, David Miller and his company, MIC, of Eagan, Minnesota, purchased prescription drugs from a network of illegal and unlicensed sources in New York, Florida and California.  Artur Stepanyan and Mihran Stepanyan, worked together to sell drugs from illegal sources to Miller and MIC.  Artur and Mihran Stepanyan, using a variety of company names, including Panda Capital Group, Red Rock Capital Group, Trans Atlantic Capital Group and GC National Wholesale, were Miller’s largest source of illegal drugs.  During the course of the conspiracy, Miller and MIC paid the Stepanyans approximately $160 million for these prescription drugs. 

“American consumers should be able to rely on the prescription drug supply chain,” said Principal Deputy Assistant Attorney General Mizer.  “Prescription drug diversion schemes like the one charged in this indictment undermine that supply chain and increase the risk that counterfeit, adulterated, misbranded, sub-potent or expired drugs will be sold to patients and consumers.” 

To hide the true, illegal sources of their prescription drugs, David Miller and MIC falsified so-called drug pedigree documents.  Pedigrees are documents required by law that show the source of drugs.  For most of the conspiracy, the fraudulent pedigrees falsely listed B&Y Wholesale, a company located in Puerto Rico and co-owned by co-conspirator Yusef Yassin Gomez (Yassin) as the source of the drugs.  The pedigree documents also falsely stated that Yassin’s company was an authorized distributor of the drugs.  On Feb. 19, 2014, Yassin pleaded guilty in U.S. District Court for the Southern District of Ohio to conspiracy to engage in the wholesale distribution of prescription drugs without a wholesale license.  In connection with his guilty plea, Yassin admitted the he agreed to allow Miller and MIC to use his company’s name on pedigree documents to hide the true drug sources.  In exchange, Miller and MIC paid Yassin a commission on all of the drug sales. 

“Once a prescription drug is diverted outside of the regulated distribution channels, it becomes difficult, if not impossible, for regulators, law enforcement and end-users to know whether the prescription drug package actually contains the correct drug or the correct dose,” said U.S. Attorney Stewart.  “We will aggressively prosecute individuals and companies that ignore the law and sell illegally diverted prescription drugs to pharmacies, and ultimately, to American consumers.

“We are committed to protecting the integrity of the pharmaceutical supply chain, especially as criminals go to more extreme measures to subvert it,” said FDA’s Office of Criminal Investigations Director Karavetsos. “We will continue to pursue these criminals and work to bring them to justice.”

“The Postal Inspection Service is proud to partner with the FDA Office of Criminal Investigations to bring to bear our mail fraud expertise to help the fight against drug diversion,” said USPIS Assistant Inspector in Charge White.

Throughout the course of the conspiracy charged in the indictment, using these fraudulent pedigree documents, Miller and MIC sold approximately $393 million worth of prescription drugs to wholesalers and retail pharmacies throughout the United States, including to multiple customers in the Southern District of Ohio. 

In addition to Yassin, two of Miller’s other illegal drug suppliers, Peter Kats and Joseph Dallal, previously pleaded guilty to conspiracy to commit mail and wire fraud for their sales of illegally-diverted prescription drugs to Miller and MIC. 

This matter is being investigated by the FDA and USPIS.  Assistant U.S. Attorneys Anne L. Porter and Christy Muncy of the Southern District of Ohio and Trial Attorney John W. Burke of the Civil Division’s Consumer Protection Branch are prosecuting this case.

David Miller, Artur Stepanyan, and Mihran Stepanyan were charged amongst 30 other individuals in the Northern District of California in a separate indictment on charges including federal Racketeer Influenced and Corrupt Organizations (RICO) Act; conspiracy to commit identity theft; conspiracy to commit access device fraud; conspiracy to commit mail, wire, and bank fraud; money laundering conspiracy; and conspiracy to distribute prescription drugs without a wholesale license.

The charges in the indictment are merely allegations, and do not constitute proof of guilt.  Every defendant is presumed to be innocent unless and until proven guilty.

WASHINGTON – A federal grand jury has brought additional charge against Christopher Lee Cornell, 21, of Green Township, Ohio.  In a superseding indictment returned in Cincinnati, he is now also charged with attempting to provide material support to a designated foreign terrorist organization.

The charge is in addition to the original Jan. 21, 2015, indictment that charged Cornell with attempting to kill officers and employees of the United States, solicitation to commit a crime of violence and possession of a firearm in furtherance of a crime of violence.  Cornell was charged for his alleged participation in a plot to attack the U.S. Capitol Building and kill government officials.

The superseding indictment, which was returned today, was announced by Assistant Attorney General for National Security John P. Carlin, U.S. Attorney Carter M. Stewart of the Southern District of Ohio, Special Agent in Charge Angela L. Byers of the FBI’s Cincinnati Field Division and Special Agent in Charge Mark Porter of the U.S. Secret Service.

The four-count superseding indictment alleges that on or about August 2014 through January 2015, Cornell allegedly plotted, planned and attempted to attack the U.S. Capitol.

The defendant is also alleged to have attempted to provide material support and resources to a foreign terrorist organization, specifically the Islamic State of Iraq and the Levant (ISIL), knowing that the organization was a designated foreign terrorist organization and that the organization had engaged in and was continuing to engage in terrorist activity.  Material support and resources consisted of personnel in the form of the defendant himself by plotting and attempting to execute an attack on the U.S. Capitol.

Cornell allegedly attempted to kill officers and employees of the United States during their official duties, specifically by attempting to attack the U.S. Capitol Building.  During that same time, the defendant allegedly attempted to persuade others to kill officers and employees of the United States.  Cornell also allegedly possessed two semi-automatic rifles and approximately 600 rounds of ammunition.

Providing material support to a designated foreign terrorist organization carries a potential maximum sentence of 15 years in prison.  Attempted murder of government employees and officials is a crime punishable by up to 20 years in prison.  Solicitation to commit an attempted murder is a crime punishable by 20 years in prison.  Possession of a firearm in furtherance of an attempted crime of violence is a crime punishable by a mandatory sentence of five years in prison.

Cornell was arrested on Jan. 14, 2015, by the FBI’s Joint Terrorism Task Force (JTTF).  The JTTF is made up of officers and agents from the Cincinnati Police Department; Colerain, Ohio, Police Department; Dayton, Ohio, Police Department; Ohio State Highway Patrol; U.S. Immigrations and Customs Enforcement; U.S. Secret Service; and West Chester, Ohio, Police Department.

Assistant Attorney General Carlin and U.S. Attorney Stewart commended the investigation of this case by the JTTF.  The case is being prosecuted by Trial Attorney Michael Dittoe of the Justice Department’s National Security Division and Assistant U.S. Attorney Tim Mangan of the Southern District of Ohio.

An indictment merely contains allegations, and the defendant is presumed innocent unless proven guilty in a court of law.

COLUMBUS, Ohio – Keegan L. Sipe, 31, of Huber Heights, Ohio, pleaded guilty in United States District Court to attempted coercion and enticement of minors to engage in unlawful sexual activity.

Carter M. Stewart, United States Attorney for the Southern District of Ohio, Upper Arlington Police Chief Brian Quinn, Marlon Miller, Special Agent in Charge, Homeland Security Investigations (HSI), and other members of the Franklin County Internet Crimes Against Children (ICAC) Task Force, announced the plea entered into today before U.S. District Judge Michael H. Watson.

According to court documents, in December 2014, Sipe attempted to persuade an individual via the Internet to engage in sexual activity with females he believed to be 10 and 14 years old. Investigators discovered an advertisement on Craigslist soliciting a “taboo mother and daughter” that stated, “Get with me if you and daughter would like to have some fun. Kinky and taboo age no matter.”

When an undercover investigator responded to the advertisement, Sipe engaged in conversation with the law enforcement official. He believed the investigator was a father arranging for Sipe to meet with his two minor daughters to engage in sexual activity.

On December 20, 2014, Sipe arranged to meet the undercover officer in the Bob Evans parking lot in Hilliard, Ohio. Upon his arrival, he was taken into custody. 

The parties involved in this case have agreed to a 10-year prison sentence for Sipe.

The Franklin County ICAC Task Force is a multi-agency effort dedicated to the fight against computer facilitated crimes against children. The following agencies are members:

Franklin County Sheriff’s Office                       Upper Arlington Police Department
Grove City Police Department                          Columbus Police Department
Grandview Heights Police Department         Whitehall Police Department
Hilliard Police Department                                 Westerville Police Department
Homeland Security Investigations                  U.S. Secret Service
Ohio ICAC                                                                   Franklin County Prosecutor's Office

This case is being brought as part of Project Safe Childhood, a nationwide initiative by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorney's Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children as well as to identify and rescue victims.

U.S. Attorney Stewart commended the cooperative investigation by the Franklin County ICAC Task Force, as well as Assistant United States Attorneys Jessica H. Kim and Heather A. Hill, who are representing the United States in this case.

COLUMBUS, Ohio – A United States District Court jury convicted Osvaldo Ortega-Amaya, 29, of Hilliard, Ohio, of conspiracy to possess with intent to distribute and possession with intent to distribute 500 grams or more of cocaine.

Carter M. Stewart, United States Attorney for the Southern District of Ohio; Joseph P. Reagan, Special Agent in Charge, Drug Enforcement Administration (DEA) and Franklin County Sheriff Zach Scott, which was returned following a trial that began on April 20 before U.S. District Judge Gregory L. Frost.

According to court testimony, agents obtained baggies with cocaine residue during a trash retrieval at a Galloway, Ohio residence in December 2014 and January 2015. When law enforcement officials executed a search warrant at the Galloway residence they located approximately 1,100 grams of cocaine, multiple firearms and a large sum of U.S. currency.

Further surveillance led investigators to a residence in Hilliard, Ohio, where Ortega-Amaya resided and stored cocaine for the trafficking ring. There, agents found approximately 594 grams of cocaine, which was hidden in a closet with baby clothes in the residence, several hours after conducting a controlled purchase of another 500+ grams earlier the same day.

The jury convicted Ortega-Amaya of one count of conspiracy to possess with intent to distribute and one count of possession with intent to distribute 500 grams or more of cocaine. Both crimes are punishable by up to 40 years in prison and a $5 million fine.

Ortega-Amaya was indicted by a grand jury on March 5, 2015, charging him and co-defendant Ezequiel Bonilla-Berrios in a two-count indictment.  Bonilla-Berrios was not tried in this proceeding. 

Stewart commended the cooperative investigation by the DEA and Franklin County Sheriff’s Office, as well as Assistant United States Attorney Mike Hunter and Special Assistant United States Attorney Brian Martinez, who prosecuted the case.

CINCINNATI – Albert D. Nassar, 59, of New York City, pleaded guilty in U.S. District Court to conspiracy to commit mail and wire fraud in connection with the illegal sale of prescription drugs bearing false pedigrees that misrepresented the sources and origins of the drugs.

Carter M. Stewart, United States Attorney for the Southern District of Ohio, Antoinette Henry, Special Agent in Charge, U.S. Food and Drug Administration Office of Criminal Investigations, and Christopher White, Assistant Inspector in Charge, U.S. Postal Inspection Service, announced the plea entered into yesterday before U.S. District Judge Sandra S. Beckwith.

According to court documents, Nassar, the owner of Worldwide Management Consultants, Inc., participated with others in a scheme between 2007 and 2009 to obtain prescription drugs from various illicit or unknown sources - known as diverted drugs - and then resell the drugs to unwitting wholesale drug companies using false pedigrees. The false pedigrees showed legitimate authorized distributors as the source of the drugs, when, the drugs were obtained outside lawful channels.

Other conspirators included Michael Schoenwald, 71, a Hollywood, Florida-based urologist, and Gregory Pfizenmayer, 46, the owner of G & D Enterprises in Foley, Alabama.

As part of the conspiracy, Schoenwald obtained Lupron, an injectable drug used to treat prostate cancer, from the manufacturer at discounted rates due to his status as a health care provider. Federal law prohibits the resale of such drugs by health care providers.

Nassar directed Schoenwald to ship the Lupron to Pfizenmayer, who in turn sold the drugs to wholesale drug companies, providing false pedigrees that concealed the illicit source of the drugs.

Other prescription drugs allegedly involved in the conspiracy included Procrit, used to treat anemia in patients with kidney failure, and Neulasta, used to prevent infections in patients undergoing chemotherapy. The drugs were shipped with the false pedigrees by mail to drug wholesalers in New Jersey, Mississippi and Ohio, and each conspirator received payments including by wire transfer.

Pfizenmayer pleaded guilty on February 2, 2011 and Schoenwald pleaded guilty on February 16, 2012. Both pleaded guilty to one count of conspiracy.

The parties involved in Nassar’s case have agreed to a sentence of 12 months and one day incarceration.

U.S. Attorney Stewart commended the cooperative investigation by the FDA and Postal Inspectors, as well as Assistant United States Attorneys Anne Porter and Christy Muncy, who are representing the United States in this case. 

COLUMBUS, OHIO – Joseph P. Molnar, 51, of Chillicothe, Ohio, was sentenced to 72 months in prison, five years of supervised release, and was ordered to pay $4,076,189.44 in restitution to Huntington National Bank and $987,011.66 in restitution to the Internal Revenue Service (IRS) for embezzling approximately $4,076,189.44 from Huntington National Bank and willfully filing a false federal income tax return with the IRS.  Molnar previously pleaded guilty to the aforementioned charges on October 24, 2014.

Carter M. Stewart, United States Attorney for the Southern District of Ohio, Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation, and Kathy A. Enstrom, Special Agent in Charge, Internal Revenue Service Criminal Investigation, Cincinnati Field Office announced the sentence handed down today by U.S. District Judge Algenon L. Marbley.

According to court documents, between July 2005 and July 2012 Joseph Molnar was an employee of Huntington National Bank.  Specifically, Molnar was a Managing Director for a Huntington subsidiary, Huntington Community Development Corporation.  Molnar misapplied and embezzled approximately $4,076,189.44 of Huntington National Bank’s funds by falsely representing that he was paying “placement fees” or “advisory fees” for property management companies as part of several affordable housing property deals that had closed with Huntington National Bank.  Instead, Molnar withdrew the funds under false pretenses and placed that money into his own accounts for his own personal use.

In addition, Molnar omitted these funds as income on his own income tax returns.  Molnar filed a false income tax return with the IRS for the 2009 income tax year by falsely stating that he had an adjusted gross income of $94,358, when in actuality his income was approximately $1,226,103.16.

For 2008 through 2012 income tax years, Molnar underreported his income by a combined total of $3,054,064.44, which has resulted in total tax due and owing in the amount of approximately $987,011.66 to the IRS.

“For seven years Joseph Molnar abused his fiduciary responsibility as an executive at Huntington National Bank,” said Angela L. Byers, Special Agent in Charge of the FBI’s Cincinnati Division. “In doing so, he took advantage of his position of trust to defraud the bank and its customers for his own pecuniary gain.  The FBI and other law enforcement agencies rely heavily on the trust and cooperation of members of the financial industry and citizens to assist us in performing our mission.  Through this cooperative effort we are able to identify the Joseph Molnars of the world and hold them accountable for their own greed.”

"The role of IRS Criminal Investigation becomes even more important in embezzlement and fraud cases due to the complex financial transactions that can take time to unravel," said Kathy A. Enstrom, Special Agent in Charges, IRS Criminal Investigation, Cincinnati Field Office.  "The federal tax laws are normally violated in these cases which can add to additional jail time.   As we often see, the victims are not only the taxpayers, but also the individuals and entities who suffer the financial harm."

U.S. Attorney Stewart commended the investigation by the IRS and FBI, Assistant United States Attorney Daniel A. Brown, who prosecuted this case.

$1.25 MILLION, COCAINE, HEROIN, FIREARMS AND AMMUNITION SEIZED

CINCINNATI –A federal grand jury has charged Christopher Whitfield, 41, of Cincinnati, Ohio, Tonia Whitfield, 39, of Cincinnati, Ohio and Steven Griffin, 39, of, Cincinnati, Ohio, with conspiracy to possess with intent to distribute one hundred grams or more of heroin, and five hundred grams or more of cocaine.  Also, Christopher Whitfield, Tonia Whitfield, Dy Shay Anderson, 22, of Cincinnati, Ohio, and Icierra Martin-Bronson, 37, of Cincinnati, Ohio were charged with conspiracy to commit money laundering in an indictment returned in Cincinnati.

Carter M. Stewart, United States Attorney for the Southern District of Ohio, Kathy Enstrom, Special Agent in Charge, Internal Revenue Service Criminal Investigation (IRS), Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Field Division, and Cincinnati Police Chief Jeffrey Blackwell announced the indictment returned yesterday.

According to the indictment, the group allegedly processed, cut, packaged and stored cocaine and heroin in stash houses in the Cincinnati area prior to distribution.

Upon executing a search warrant, investigators found approximately one-quarter kilogram of heroin and over a kilogram of cocaine, plus narcotics paraphernalia (hydraulic presses, narcotics wrappers, grinders, scales, and baggies), numerous firearms, ammunition, and ballistic vests (body armor) and approximately $1.25 million in cash at the Cincinnati stash houses.

The indictment further alleges that between January 2011 and December 2014 Christopher Whitfield, Tonia Whitfield, Dy Shay Anderson, and Icierra Martin-Bronson conspired to commit money laundering by conducting financial transactions to launder the proceeds and/or profits earned from the illegal narcotics trafficking through various methods. They allegedly deposited smaller denominations of currency into bank accounts held in the names of others; deposited cash into bank accounts for the purpose of paying bills; obtained cashier’s checks to pay for Christopher Whitfield’s personal and business credit cards; used cash to purchase a 2010 BMW and purchased rental properties on behalf of EDC Properties with cash or cashier’s checks. Christopher Whitfield also allegedly filed false federal income tax returns with the IRS for the 2012 and 2013 tax years, by underreporting the amount of income he received in each of those years

Christopher Whitfield, Tonia Whitfield, and Steven Griffin were each charged with one count of conspiracy to possess with the intent to distribute one hundred grams or more of heroin and five hundred grams or more of cocaine.

Christopher Whitfield and Steven Griffin were each charged with one count of possession with the intent to distribute one hundred grams or more of heroin; one count of possession with the intent to distribute five hundred grams or more of cocaine; one count of being a felon in possession of a firearm; and one count of possessing a firearm in furtherance of a narcotics offense.

Christopher Whitfield was also charged with two counts of maintaining a drug involved premises.
Steven Griffin was also charged with one count of maintaining a drug involved premises.

Christopher Whitfield, Tonia Whitfield, Dy Shay Anderson, and Icierra Martin-Bronson were each charged with one count of conspiracy to commit money laundering.

Tonia Whitfield and Dy Shay Anderson were also each charged with three counts of money laundering, and Icierra Martin-Bronson with two counts of money laundering.

Conspiracy to possess with the intent to distribute one hundred grams or more of heroin and five hundred grams or more of cocaine carries a maximum prison term of 40 years in prison, and has a mandatory penalty of at least 5 years in prison.

Possession with the intent to distribute one hundred grams or more of heroin carries a maximum penalty of 40 years in prison, and has a mandatory penalty of at least 5 years in prison.                .

Possession with the intent to distribute five hundred grams or more of cocaine carries a maximum penalty of 40 years in prison, and has a mandatory penalty of at least 5 years in prison.

Being a felon in possession of a firearm carries a maximum penalty of 10 years in prison.  Possessing a firearm in furtherance of a narcotics offense carries a maximum penalty of Life in prison, and has a mandatory minimum penalty of 5 years to be served consecutively to any other sentence imposed.  Maintaining a drug involved premises, conspiracy to commit money laundering, and money laundering carries a maximum penalty of 20 years in prison.

Christopher Whitfield was arrested on March 31, 2015 on charges of possession of a firearm by a convicted felon and possession with the intent to distribute heroin.  He was detained following his arrest.

Steven Griffin was arrested on March 31, 2015 on a charge of possession with the intent to distribute in excess of 100 grams of heroin.  He was detained following his arrest.

“The laundering of illegal drug profits is as important and essential to drug traffickers as the very distribution of their illegal drugs.  Without these ill-gotten gains, the traffickers could not finance their organizations,” said Kathy A. Enstrom, Special Agent in Charge, IRS Criminal Investigation, Cincinnati Field Office.  “Today's indictment is a direct result of the excellent partnership that the IRS, U.S. Attorney’s Office, FBI, and Cincinnati Police Department has in combating major drug trafficking organizations, which have such a negative impact on our community."

U.S. Attorney Stewart commended the cooperative law enforcement investigation, as well as Assistant United States Attorneys Karl Kadon and Jessica Knight, who are prosecuting the case.

An indictment merely contains allegations, and the defendant is presumed innocent unless proven guilty in a court of law.

WASHINGTON –A federal grand jury has charged Abdirahman Sheik Mohamud, 23, of Columbus, with one count of attempting to provide and providing material support to terrorists, one count of attempting to provide and providing material support to a designated foreign terrorist organization and one count of making false statements to the FBI involving international terrorism in an indictment returned in Columbus, Ohio.

Assistant Attorney General for National Security John P. Carlin, Carter M. Stewart, United States Attorney for the Southern District of Ohio, Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Franklin County Prosecutor Ron O’Brien and the FBI’s Columbus Joint Terrorism Task Force (JTTF), announced the indictment returned today.

According to court documents, Mohamud left the United States in April 2014 for the purpose of training and fighting with terrorists in Syria.

As a naturalized citizen of the United States, he obtained a U.S. passport and purchased a one-way ticket to Greece. He did not board his connecting flight to Athens, Greece during his layover in Istanbul, Turkey, and instead completed pre-arranged plans to travel to Syria.

According to the indictment, Mohamud stated that, after arriving in Syria, he obtained training from a group in shooting weapons, breaking into houses, explosives and hand-to-hand combat. Mohamed also stated that, after completing this training, he was instructed by a cleric in the organization to return to the United States and commit an act of terrorism.

“According to the charges in the indictment, Mohamud allegedly traveled to Syria to train with and fight alongside terrorists” said Assistant Attorney General Carlin.  “Identifying and neutralizing the threat posed by foreign terrorist fighters who return to the United States is one of the National Security Division’s highest priorities.  I want to thank the many agents, analysts, and prosecutors who are responsible for this ongoing investigation and today’s charges.”

“Mohamud sought and obtained terrorist training in Syria,” U.S. Attorney Carter Stewart said. “Upon his return to the United States, he discussed carrying out acts in the United States.”

"The Joint Terrorism Task Force and our law enforcement partners work tirelessly to protect our community," stated FBI Special Agent in Charge Angela L. Byers. "Cases like this are tangible reminders of the threats we face each day."

“Our office worked with the JTTF to assist in the arrest and continued detention of Mohamud, including securing a terrorism indictment in State court,” Franklin County Prosecutor Ron O’Brien said. “That state court charge will now be dismissed and that cooperation will continue in federal court with Assistant Prosecutor Joseph Gibson being named to the trial team to assist in the prosecution of the federal indictment that was announced today.”

Providing material support to terrorists and providing material support to a designated foreign terrorist organization – in this case, namely, Jabhat al-Nusrah – are each crimes punishable by up to 15 years in prison. Making false statements involving international terrorism carries a maximum sentence of eight years in prison.

Mohamud is scheduled to be transferred into federal custody based on today’s indictment.  He was arrested and detained on state charges on Feb. 21, 2015.

Assistant Attorney General Carlin and U.S. Attorney Stewart commended the cooperative investigation of JTTF, and Assistant United States Attorneys Doug Squires, Dana Peters and Salvador Dominguez, Special Assistant United States Attorney Joseph Gibson with the Franklin County Prosecutor’s office and Department of Justice National Security Division Trial Attorney Bridget Behling, who are prosecuting the case.

An indictment merely contains allegations, and the defendant is presumed innocent unless proven guilty in a court of law.

COLUMBUS, Ohio – A federal grand jury has charged Thomas E. Shaffer, 62, of Columbus, Ohio, with six armed robberies in an indictment returned in Columbus.

Carter M. Stewart, United States Attorney for the Southern District of Ohio, Delaware County Sheriff Russell L. Martin, Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Field Division, Donald Soranno, Special Agent in Charge, Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Delaware County Prosecutor Carol O’Brien, Columbus Police Chief Kim Jacobs, Gahanna Police Chief Dennis Murphy, Powell Police Chief Gary L. Vest and Worthington Police Chief James Mosic announced the indictment returned today.

The indictment alleges that on six different occasions, Shaffer robbed establishments in Central Ohio while armed. Specifically, Shaffer allegedly robbed The Pub in Gahanna, Ohio; Halftime Tavern in Columbus, Ohio; Brew-Stirs on 23 in Columbus, Ohio; Lazy Chameleon in Powell, Ohio; Villa Nova in Worthington, Ohio and Aldi in Lewis Center, Ohio between March 2014 and December 2014 while brandishing a firearm.

Shaffer was indicted on six counts of robbery, a crime punishable by up to 20 years in prison and six counts of using a firearm during the commission of the robberies. Brandishing a firearm during and in relation to a crime of violence carries a potential penalty of seven years in prison for the first count of conviction and up to 25 years of prison consecutively for each additional count.

U.S. Attorney Stewart commended law enforcement’s cooperative investigation of this case, and Assistant United States Attorney David DeVillers and Special Assistant United States Attorney Brian Martinez, who are prosecuting the case.

An indictment merely contains allegations, and the defendant is presumed innocent unless proven guilty in a court of law.

CINCINNATI – Brenda Ashcraft, 45, of Milford, Ohio pleaded guilty in U.S. District Court to defrauding investors of at least $15 million between 2009 and 2013 in a fraudulent investment scheme to purchase and sell real estate through real estate investment trusts known as REITs.

Carter M. Stewart, United States Attorney for the Southern District of Ohio; Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI); Mark Porter, Special Agent in Charge, U.S. Secret Service; and Jacqueline Williams, Director of Ohio Department of Commerce, announced the plea entered into today before U.S. District Senior Judge Sandra S. Beckwith.

According to court documents, Aschraft owned and operated French Manor Properties, which she told investors was acting as the REIT Trustee that would “secure residential and commercial real estate at wholesale pricing.”  Investors believed that their investments were secured by real estate and Ashcraft promised them 40% annual returns on their investments. These representations were false.

Instead, Ashcraft used new investor money to pay earlier investors and diverted investor funds to her own personal use and benefit, including a $50,000 investor payment that she used to pay for Cincinnati Reds season tickets.  Ashcraft would at times send investors checks for returns on their investments but the checks often bounced.  After FBI agents seized Ashcraft’s iPhone pursuant to a search warrant, she sent a remote wipe command to destroy evidence stored on her cell phone.

Ashcraft pleaded guilty to one count of wire fraud, one count of securities fraud and one count of destruction of evidence, each punishable by up to 20 years in prison, and one count of money laundering, which is punishable by up to 10 years in prison.

Ashcraft’s case was scheduled to begin trial yesterday, but was delayed when she failed to appear in court. Ashcraft turned herself in late yesterday afternoon.

Stewart commended the cooperative investigation of this case by FBI and Secret Service agents, Ohio Department of Commerce, Division of Securities staff, and Assistant U.S. Attorneys Timothy Mangan and Emily Glatfelter, who are prosecuting the case.

Investigators seek help in identifying more victims

CINCINNATI – A federal grand jury has charged Martell A. Lowry, 25, of Cincinnati, with seven counts of production of child pornography involving seven different minors and coercion and enticement in an indictment returned in Cincinnati.

Carter M. Stewart, United States Attorney for the Southern District of Ohio, Hamilton County Sheriff Jim Neal, Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), and other members of the Regional Electronics and Computer Investigations Task Force and (RECI) Greater Cincinnati Internet Crimes Against Children Task Force (ICAC), announced the indictment returned today.

A criminal complaint filed against Lowry alleged he used Facebook to contact young teenage boys for the purpose of soliciting sex from the juveniles. Lowry allegedly offered to pay them to either let him perform oral sex on them or to send him nude photos of themselves. Thus far, the investigation has identified more than 25 children as being victimized by Lowry.

According to the indictment, Lowry allegedly enticed and coerced at least 14 minors to engage in sexual activity for which he could be charged with an offense.

The indictment charges Lowry with seven counts of production of child pornography and one count of coercion and enticement.

Each count of production of child pornography is a crime punishable by up to 30 years in prison and coercion and enticement carries a maximum sentence of life in prison. Both crimes include at least five years of supervised release.

Lowry remains in custody.

U.S. Attorney Stewart commended the investigation of this case by the Hamilton County Sheriff’s Office, FBI, RECI and Greater Cincinnati ICAC, and Assistant United States Attorney Christy Muncy, who is prosecuting the case.

An indictment merely contains allegations, and the defendant is presumed innocent unless proven guilty in a court of law.

The Regional Electronics Computer Investigations and Greater Cincinnati Internet Crimes Against Children continue to investigate Lowry’s internet and Facebook activity.  Detectives have identified several juvenile victims and believe there may be more.  If you have information or have been in contact with Lowry, please call investigators at 513-946-8353.

WASHINGTON – A former trooper with the Ohio State Highway Patrol was sentenced today in Columbus, Ohio, to 60 months in federal prison for coercing four female victims to engage in sexual acts in exchange for lenient treatment in connection with potential criminal cases and traffic tickets.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Carter M. Stewart of the Southern District of Ohio, Special Agent in Charge Angela L. Byers of the FBI’s Cincinnati Division, Superintendent of the Ohio State Highway Patrol (OSP) Colonel Paul A. Pride and Licking County Prosecutor Kenneth W.  Oswalt made the announcement.  U.S. District Judge Michael H. Watson of the Southern District of Ohio imposed the sentence.

Bryan D. Lee, 31, of Lancaster, Ohio, pleaded guilty on Oct. 29, 2014, to four counts of violating the civil rights of female motorists and one count of engaging in cyber stalking.  Lee served as an OSP Trooper from approximately January 2006 until October 2013.  As part of his plea, Lee admitted that he violated the civil rights of four female victims by coercing them in his official capacity to commit sexual acts, some of which he photographed, in exchange for his agreement not to file criminal charges or issue traffic infractions against the victims or their friends.  Lee further admitted that he engaged in sexual contact with certain victims while they were under arrest and restrained in handcuffs.  Lee also harassed and threatened some of the victims, including sending threatening electronic messages to one individual who he pulled over twice during a one-month period.

            This case was investigated by the Columbus office of the FBI’s Cincinnati Division and OSP.  The case was prosecuted by Trial Attorney Edward P. Sullivan of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney J. Michael Marous of the Southern District of Ohio.  Also assisting in the investigation was Fairfield County Special Prosecutor Martin Frantz.

COLUMBUS, Ohio – Thomas “Tommy” G. Thompson, 62, and Alison L. Antekeier, 47, both formerly of Columbus, Ohio, pleaded guilty in U.S. District Court to criminal contempt, specifically disobedience or resistance of the court, stemming from a civil lawsuit.

Carter M. Stewart, United States Attorney for the Southern District of Ohio, and Peter C. Tobin, United States Marshal for the Southern District of Ohio, announced the plea entered into today before U.S. District Judge Algenon L. Marbley.

According to court documents, Thompson disobeyed and resisted a lawful order of U.S. District Chief Judge Sargus, who ordered Thompson to personally appear at an August 13, 2012 hearing related to a civil case involving the defendant. Specifically, Thompson had been ordered to appear at a hearing to provide an accounting of certain funds and the location of 500 re-strike commemorative gold coins as part of a lawsuit over the treasure that Thompson found from the SS Central America shipwreck. A bench warrant for Thompson’s arrest was issued the same day.

Antekeier was also ordered to appear in U.S. District Court as a witness in the civil lawsuit. She was to appear in court to give testimony related to the civil case on November 7, 2012; a bench warrant for her arrest was issued when she failed to appear.

In March 2013, an arrest warrant based on a criminal complaint alleging criminal contempt was authorized against Thompson.

U.S. Marshals found and arrested Thompson and Antekeier on January 27, 2015 in Boca Raton, Florida. Thompson and Antekeier – Thompson’s former assistant and current girlfriend – had been living in a Hilton hotel room under fake names and paying with cash.

“Deputy U.S. Marshals in Columbus were relentless in their pursuit of Thompson and Antekeier,” U.S. Marshal Tobin said. “Thompson and Antekeier were very sophisticated in avoiding capture and had access to nearly unlimited funds, enabling them to stay completely off the radar for years.  The U.S. Marshals Service with Deputy U.S. Marshals across the country can cast a wide net in apprehending fugitives.  In this instance, Deputy U.S. Marshals from the West Palm Beach, Florida office stepped up and played a major role in the capture of the treasure hunter and his companion.”

As part of their plea, the couple has agreed to forfeit the more than $425,000 in cash that was seized at the time of their arrest.

U.S. Attorney Stewart commended the investigation by the U.S. Marshals Service, as well as Senior Litigation Counsel Douglas W. Squires, who is representing the United States in this case. 

COLUMBUS, OHIO – Suheidy A. Warner, 31, of Columbus, was sentenced to 18 months in prison for conspiracy to file false claims for federal income tax refunds with the Internal Revenue Service (IRS). Warner was also ordered to pay more than $251,000 in restitution to the IRS. Approximately $63,000 of the restitution will be paid jointly with the co-conspirators in this case.

Carter M. Stewart, United States Attorney for the Southern District of Ohio; Kathy A. Enstrom, Special Agent in Charge, Internal Revenue Service (IRS), Criminal Investigation, Cincinnati Field Office; and Christopher White, Assistant Inspector in Charge, U.S. Postal Inspection Service announced the sentence handed down today by U.S. District Judge Gregory L. Frost.

According to court documents, between February 2010 and June 2010 Warner abused her position of trust as a Chase Bank teller by cashing approximately 36 federal income tax refund checks she knew were fraudulently obtained.  Warner was not given authorization by Chase Bank to cash these checks and was subsequently terminated.

The tax refund checks were given to Warner by a man who identified himself as Rafael Mota.  Rafael Mota told her that the checks needed to be cashed for people that did not have identification, so they could cash the refund checks themselves.

The income tax refund checks were mailed to pre-arranged addresses, usually apartments in New York, New Jersey and other nearby states.  The addresses contained on many of the income tax refund checks often shared the same street address, but different apartment numbers.  This made it easier to collect the income tax refund checks from one location. The income tax refund checks were collected by corrupt postal workers, apartment superintendents, or other perpetrators who simply waited for the checks to be delivered by unknowing mail carriers.  The perpetrators then used couriers to travel to surrounding states, including to Columbus, Ohio, to cash the checks at various check-cashing service businesses, including San Isidro Cargo.  The owners of San Isidro Cargo were Mercedes Emelinda-Silie and Jose Martinez.

Warner used various Chase Bank customer accounts to cash the income tax refund checks.  Warner deposited the funds into two prearranged accounts.  One account was that of a co-conspirator located in New Jersey.  The second was the account of Alberto Rivera Falcon.  Nineteen income tax refund checks totaling $126,108.30 were deposited into Falcon’s account.  Seventeen income tax refund checks totaling $62,107 were deposited into the account of the co-conspirator located in New Jersey.  Warner received approximately $200 to $300 per check.

Warner admitted to hand-carrying these U.S. Treasury checks to work at Chase Bank, using Falcon’s account to deposit them, withdrawing large sums of cash, and leaving the bank with the cash in her possession and providing the currency to other co-conspirators.

The income tax refund checks, and the believed stolen State of New Jersey tax refund checks, were the sole sources of deposits into both accounts.  Warner received the income tax refund checks with the endorsed signature directly from Rafael Mota and Alberto Falcon.  None of the income tax refund checks bore Warner’s name, Falcon’s name, Mota’s name or the New Jersey co-conspirator’s name.

The total tax loss associated with Warner’s involvement in this conspiracy is approximately $188,215.30, which represents the total of the 36 purported income tax refund checks that she helped to negotiate.

Warner returned to the United States and pleaded guilty to one count of conspiracy to file false claims for federal income tax refunds with the IRS on December 9, 2014.

On April 4, 2014 Jose Luis Martinez, 48, of Columbus, Ohio was sentenced by U.S. District Judge Gregory L. Frost to 60 months in prison, three years of supervised release, and ordered to pay $4,415,492.58 in restitution to the IRS for his role in a conspiracy to defraud the IRS by filing false claims for federal income tax refunds and for operating an unlicensed money transmitting business.

On April 24, 2014 Mercedes Emelinda-Silie, 41, of Grove City, Ohio was sentenced by U.S. District Judge Gregory L. Frost to 36 months in prison, three years of supervised release, and ordered to pay $4,415,492.58 in restitution to the Internal Revenue Service (IRS) for her role in a conspiracy to defraud the IRS by filing false claims for federal income tax refunds.

Stewart commended the investigation by IRS-Criminal Investigation and the U.S. Postal Service, as well as Assistant United States Attorney Daniel Brown, who represented the United States in this case.

COLUMBUS, Ohio – Carl R. Smith, Jr., 30, of Columbus, Ohio, pleaded guilty in U.S. District Court to transportation in interstate commerce for purposes of prostitution and possession of a firearm by a previously convicted felon.

Carter M. Stewart, United States Attorney for the Southern District of Ohio, Ohio Attorney General Mike DeWine and members of the Central Ohio Human Trafficking Task Force, which is part of the Ohio Attorney General’s Ohio Organized Crime Investigations Commission, including Marlon V. Miller, Special Agent in Charge, U.S. Homeland Security Investigations, Columbus Police Chief Kim Jacobs and Colonel Paul Pride of the Ohio State Highway Patrol announced the plea entered today before U.S. District Judge Michael H. Watson.

According to court documents, during a traffic stop in July 2013 in which Smith was driving, law enforcement officers discovered an adult female passenger had a plastic baggie containing cocaine base and heroin. Based on information previously obtained through surveillance and confidential sources, it was believed that Smith was involved in directing the prostitution activities of the passenger and other females and that he had used the passenger during the traffic stop to conceal his supply of cocaine base and heroin.       

Members of the Central Ohio Human Trafficking Task Force and the Columbus Police Department conducted an investigation of Smith’s suspected criminal activities between July 2013 and February 2014.  A search warrant was executed at Smith’s residence in February 2014.  While searching the residence, officers discovered Smith, who had been previously convicted of four felony offenses, was carrying a pistol. Numerous additional firearms and narcotics were seized from Smith’s residence during the execution of the search warrant.

During the course of the investigation leading up to the execution of the search warrant, officers conducted electronic and physical surveillance of Smith’s activities.  During this surveillance, officers observed that Smith frequented various hotels in the Columbus, Ohio area where he had prostitutes working for him. Continued surveillance revealed that Smith also facilitated travel out of state to Pittsburgh and New York City, where his prostitutes engaged in sexual activity for hire. Smith attracted clients/johns for his prostitution business by posting numerous advertisements in the escort section of the Internet site backpage.com.

Transportation in interstate commerce for purposes of prostitution is a crime punishable by up to 10 years in prison and possession of a firearm by a previously convicted felon who is an armed career criminal carries a maximum sentence of up to life in prison.

U.S. Attorney Stewart commended the cooperative investigation by the Central Ohio Human Trafficking Task Force, as well as Assistant United States Attorneys Heather A. Hill and Salvador A. Dominguez, who are representing the United States in this case.

COLUMBUS – A federal grand jury has charged Jason L. Gunsorek, 39, of Blacklick, Ohio, with making false statements to a federally insured financial institution in connection with loans to limited liability companies he created and controlled.

Carter M. Stewart, United States Attorney for the Southern District of Ohio, Kathy Enstrom, Special Agent in Charge, Internal Revenue Service Criminal Investigation (IRS), and Christy Romero, Special Inspector General for the Troubled Asset Relief Program (SIGTARP), announced the superseding indictment returned March 31, 2015 against Gunsorek, which charges him with two counts of money laundering and with two counts of loan fraud.

According to the superseding indictment, in March 2009 Gunsorek made at least one false statement in securing a loan from CF Bank, a federally insured bank, to Fair and Fourth LLC, a limited liability company he controlled, in order to secure funds for the purpose of rehabilitating and making improvements to properties in the Columbus, Ohio area.  The superseding indictment further alleges Gunsorek used 98 North High Partners, LLC, another limited liability company he organized and controlled, to make at least one other false statement in connection with another loan tied to the original loan, in which Gunsorek had a straw buyer secure a loan from CF Bank in order to purchase a parking lot located at 98 North High Street, Columbus, from a third limited liability company Gunsorek controlled, and this loan defeated the regulatory legal lending limits on CF Bank as to Gunsorek, and allowed CF Bank to disburse to Fair and Fourth LLC the proceeds of the original loan in the amount of $762,000.

The superseding indictment further alleges that once Gunsorek and Fair and Fourth LLC obtained the proceeds of the $762,000 loan from CF Bank, for the express and only purpose of rehabilitating and for making improvements to properties located at 1407-1415 North Fourth Street, 1309 Fair Avenue, and 1319 Fair Avenue, all of which are located in Columbus, Ohio, he used all those monies for other purposes at other companies he controlled, including Central Park ARC, LLC and Anchor Management Group, Inc.

In June 2009 Gunsorek allegedly committed money laundering by writing two checks from the bank account held at CF Bank in the name of Fair and Fourth LLC, one in the amount of $20,000 that was deposited in a bank account in the name of Central Park ARC, LLC and one in the amount of $295,000 that was deposited in a bank account in the name of Anchor Management Group, Inc.

Making false statements to obtain loans from a federally insured bank is punishable by up to 30 years imprisonment, and money laundering is punishable by up to 10 years imprisonment.

U.S. Attorney Stewart commended the cooperative law enforcement investigation, as well as Assistant United States Attorney Dale E. Williams, Jr., who is prosecuting the case.

An indictment merely contains allegations, and the defendant is presumed innocent unless proven guilty in a court of law.

COLUMBUS, Ohio – Jeremiah R. Malfroid, 33, of Hilliard, Ohio, pleaded guilty in U.S. District Court to production of child pornography.

Carter M. Stewart, U.S. Attorney for the Southern District of Ohio, Marlon V. Miller, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI), and members of the Franklin County Internet Crimes Against Children Task Force announced the plea entered into today before U.S. District Judge Gregory L. Frost.

According to court documents, investigators with the Franklin County Internet Crimes Against Children (ICAC) task force connected files containing child pornography to the defendant’s computer. While executing a search warrant and forensic examination of Malfroid’s computer, investigators discovered 281 files of child pornography, 77 of which depicted children who have been identified by the National Center for Missing and Exploited Children (NCMEC).

Numerous additional images on Malfroid’s computer depicted Malfroid sexually abusing a female child. It was confirmed that Malfroid had access to the juvenile female between approximately 2007 and 2013, when the child was three to nine years old.

Malfroid was charged by criminal complaint in October 2014 and absconded during the investigation. He turned himself in to local authorities in California in December 2014, after being profiled on the U.S. Immigration and Customs Enforcement (ICE) Operation Predator smartphone app. A user-generated Facebook post indicating Malfroid’s fugitive status had been created the same month and shared nearly 200,000 times.

Production of child pornography is a crime punishable by up to 30 years in prison.
The Franklin County ICAC Task Force is a multi-agency effort dedicated to the fight against computer facilitated crimes against children. The following agencies are members:

Franklin County Sheriff’s Office

Upper Arlington Police Department

Grove City Police Department

Columbus Police Department

Grandview Heights Police Department

Whitehall Police Department

Hilliard Police Department

Westerville Police Department

Homeland Security Investigations

U.S. Secret Service

Ohio ICAC

Franklin County Prosecutor's Office

This case is being brought as part of Project Safe Childhood, a nationwide initiative by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorney's Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children as well as to identify and rescue victims.
U.S. Attorney Stewart commended the cooperative investigation by HSI and the Franklin County ICAC Task Force, as well as Assistant United States Attorneys Heather A. Hill and Jessica H. Kim, who are representing the United States in this case. 

ROOFING INSURANCE FRAUD SCHEME

DAYTON – Jim Honious, 45, of Dayton was sentenced here today to 12 months in prison for his role in submitting fraudulent insurance claims for roofing repairs. Honious was a salesman for the now-defunct Williams Brothers Roofing and Siding company.

Carter M. Stewart, United States Attorney for the Southern District of Ohio, Marlon V. Miller, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI), and Kathy A. Enstrom, Special Agent in Charge, Internal Revenue Service (IRS), Criminal Investigation, Cincinnati Field Office, announced the sentenced imposed today by United States District Judge Walter H. Rice.

Honious pleaded guilty in December 2013 after being charged in a one-count bill of information with conspiring with Williams Brothers’ owner, Gregory Oldiges, to defraud insurance providers using false billing practices. As an incentive to secure more customers, Williams Brothers offered to cover their customers’ insurance deductibles, but those deductibles were fraudulently passed to their insurance providers using “dummy” invoices which had been inflated  over and above the deductible amounts.

Honious would have two invoices prepared for a job, with the “real invoice” being submitted to the customer for the amount actually charged for the particular roofing job and the “dummy” invoice being submitted to the insurance company at a higher amount to cover the deductibles. In some cases, the dummy invoice was inflated by more than just the customer’s deductible (inflated by $11,000 in one instance), in an effort to “cover” the customer’s repairs that were uncovered by insurance and to otherwise secure the customer’s business.

Honious was personally responsible for submitting at least 43 fraudulent “dummy” invoices between November 2010 and December 2012, with the difference between the real invoice amounts and the “dummy” invoice amounts totaling more than $75,000.

Honious was ordered to serve three years on supervised release following his prison term and must pay restitution in excess of $75,000 to the defrauded insurance companies. He must also complete 100 hours of community service.

Oldiges also pled guilty for his role in the insurance fraud conspiracy (and for other crimes).  He died in 2014 prior to his sentencing.

U.S. Attorney Stewart commended the investigation of this case by HSI and IRS, and Assistant United States Attorneys Vipal Patel, Alex Sistla, and Pamela Stanek, who prosecuted the case.

DAYTON – A federal grand jury has charged Dennis S. Hunter, 51, and Sivan D. Hunter, 45, both of Dayton, with conspiracy to distribute marijuana and money laundering in an indictment returned in Dayton.

Carter M. Stewart, United States Attorney for the Southern District of Ohio, Joseph P. Reagan, Special Agent in Charge, Drug Enforcement Administration (DEA) and Kathy A. Enstrom, Special Agent in Charge, Internal Revenue Service (IRS), Criminal Investigation, Cincinnati Field Office, announced the indictment that was unsealed yesterday.

The indictment alleges that the Dennis Hunter conspired to distribute and possessed with intent to distribute more than 1,000 kilograms of marijuana in the Southern District of Ohio.

The couple allegedly laundered the illegal drug proceeds by acquiring various real estate properties, including multiple residential properties in the Dayton metropolitan area. Dennis Hunter allegedly used these properties to store and sell the marijuana. The Hunters also allegedly used the drug trafficking activities to purchase vehicles in cash, including a Volvo XC90 and Mercedes Benz R350.

Dennis Hunter allegedly used the drug proceeds for various repairs and improvements at one of his homes, including the purchase of granite countertops, windows, furniture and an 80-inch television. It is also alleged that he attempted to disguise his illegal profits by converting cash into money orders, which he then deposited into various bank accounts under his control.

Dennis Hunter remains in custody. Sivan Hunter has been released on her own recognizance.

Conspiracy to distribute marijuana is a crime punishable by up to by at least 10 years and up to a lifetime of imprisonment years in prison and money laundering carries a maximum sentence of 20 years imprisonment.

U.S. Attorney Stewart commended the investigation of this case by the DEA and IRS, and Assistant United States Attorney Brent Tabacchi, who is prosecuting the case.

An indictment merely contains allegations, and the defendant is presumed innocent unless proven guilty in a court of law.

COLUMBUS, Ohio, – A federal grand jury has charged Robert D. Ledbetter, 35; Christopher A. Harris, 27; Rashad A. Liston, 25, and Deounte Ussury, 30, all formerly of Columbus, Ohio, with murder and violent crimes in aid of racketeering activity in an indictment returned in Columbus, Ohio.

Carter M. Stewart, United States Attorney for the Southern District of Ohio, Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Joseph P. Reagan, Special Agent in Charge, Drug Enforcement Administration (DEA), Donald Soranno, Special Agent in Charge, Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Franklin County Prosecutor Ron O’Brien, and Columbus Police Chief Kim Jacobs announced the indictment, which was returned today.

The indictment alleges that the defendants committed murder with a firearm during and in relation to a drug trafficking crime on April 22, 2007 in Columbus, Ohio.  Under federal law, the offenses charged in the indictment are punishable by the death penalty or life in prison without the possibility of parole.   

It is alleged that the four defendants committed the murder for the purpose of gaining entrance to and maintaining and increasing their position in the Short North Posse, an enterprise engaged in racketeering activity in Columbus and other parts of Ohio.  Various members of the Short North Posse formed subsets of the criminal organization, known as “Cut Throat Committee” and “Homicide Squad,” and engaged in murders, attempted murders, drug trafficking, weapons trafficking, extortion, robbery, arson and other crimes.

“The Short North Posse enterprise had an informal structure where status and respect were acquired in a large part by the commission of acts of violence,” U.S. Attorney Stewart said. “Bringing to justice criminal organizations like the Short North Posse that traffic drugs and use violence and intimidation to terrorize communities is one of our highest priorities.  This indictment is yet another step in holding these individuals accountable.”

In June 2014 and October 2014, respectively, the grand jury returned similar indictments charging these four defendants and other members and associates of the Short North Posse with a host of crimes in aid of racketeering activity, including 13 murders.  The U.S. Attorney’s Office will formally request that the federal district court join the new indictment with the previous indictments, so that all the offenses can be tried together in April 2016. 

“Living a life of drugs and violent crime has its consequences from an arrest to sentencing,” Columbus Police Chief Kim Jacobs said. “These defendants will have to pay a price, even eight years after their offenses, for destroying the lives of others.  The Columbus Division of Police has and will continue to work to diligently against gang activity.”

All of the defendants remain in custody.

U.S. Attorney Stewart commended the cooperative investigation by law enforcement and Assistant U.S. Attorneys David DeVillers and Kevin Kelley and Special Assistant U.S. Attorney Brian Martinez, as well as Special Assistant U.S. Attorney Jimmy Lowe with Franklin County Prosecutor O’Brien’s Office, who are prosecuting the case.

An indictment merely contains allegations, and the defendants are presumed innocent unless proven guilty in a court of law.

DAYTON – A federal grand jury has charged Timothy Hock, 50, currently of Chicago, Illinois, with embezzlement from a bankruptcy state and tax evasion in an indictment returned in Dayton.

Carter M. Stewart, United States Attorney for the Southern District of Ohio, Kathy Enstrom, Special Agent in Charge, Internal Revenue Service Criminal Investigation (IRS), and Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation, Cincinnati Field Division, announced the indictment returned yesterday.

According to the indictment, Hock, who was a Certified Public Accountant, was the controller for Domin-8 Enterprise Solutions, Inc. (Domin-8) when Domin-8 (and other related entities) filed for Chapter 11 bankruptcy in September 2009 in the Southern District of Ohio.  Domin-8 was a Mason, Ohio-based company that provided software to companies that managed rental properties.

During the bankruptcy proceedings, Hock was initially appointed as the “Responsible Person” for Domin-8 and later appointed the Plan Trustee. As the Plan Trustee, Hock was responsible for handling the company’s liquidation and transfer of assets, completing claims reviews and making appropriate distributions to various creditors of the company.

Hock allegedly used his position to embezzle money belonging to the bankruptcy estate of Domin-8.  Specifically, the indictment alleges that between approximately February 2010 and May 2013, Hock embezzled approximately $1.1 million.

Furthermore, the indictment alleges that Hock committed tax evasion on his 2011 federal income tax return by claiming that his taxable income for 2011 was $0.00, when in actuality his taxable income for the year was $433,625.

Hock was charged with one count of embezzling property that belonged to a bankruptcy estate, in violation of 18 U.S.C. § 153, and one count of tax evasion, in violation of 26 U.S.C. § 7201.

Both crimes are punishable by up to 5 years imprisonment.

“Fraud and dishonesty in bankruptcy proceedings undermines the integrity of these important proceedings and especially hurts those creditors who can ill-afford to take a loss on legitimate debts,” said Kathy A. Enstrom, Special Agent in Charge, IRS Criminal Investigation, Cincinnati Field Office.  “Embezzling funds belonging to a bankruptcy estate and not paying taxes is a gross violation of civic duty and deserves the punishment handed down today.”

U.S. Attorney Stewart commended the cooperative law enforcement investigation, as well as Assistant United States Attorney Alex R. Sistla, who is prosecuting the case.

An indictment merely contains allegations, and the defendant is presumed innocent unless proven guilty in a court of law.

DAYTON – Metin Atilan, 55, formerly of Las Vegas, pleaded guilty in U.S. District Court to conspiracy to commit wire fraud, assault of a federal officer and failure to appear on pretrial release. Atilan, a former Department of Defense contractor, was extradited from Iraq to the United States in July. He was the first person extradited from Iraq to the United States pursuant to the U.S.-Iraq extradition treaty of 1936.

Carter M. Stewart, United States Attorney for the Southern District of Ohio, Special Agent in Charge Angela L. Byers of the FBI’s Cincinnati Office and Assistant Special Agent in Charge Jeffrey Arsenault of the Defense Criminal Investigation Service (DCIS) announced the plea entered into yesterday before U.S. District Judge Thomas Rose.

Atilan, a dual U.S. and Turkish citizen, was charged by indictment on June 10, 2008.  According to court documents, Atilan is President and Chief Executive Officer of PMA Services, Ltd. of Las Vegas and Kayteks Ltd. of Adna, Turkey.  In 2006 through 2008, Atilan offered bribes and kickbacks in order to secure contracts for businesses he owned in connection with services and construction associated with U.S. military operations in Iraq.  Some of the Defense Department contracting officials who Atilan is accused of trying to bribe were stationed in Dayton at the time.   

Atilan was first arrested in Las Vegas on May 23, 2008. Atilan was placed on electronic monitoring there pending his formal hearing before a federal judge in Dayton, Ohio.  On June 15, 2008, Atilan violated the terms of his pretrial release by cutting off his electronic bracelet and fleeing the country.  Atilan also forcibly resisted and assaulted a federal officer who was escorting him from Iraq to the United States on July 24, 2014.The government sought his extradition, and Atilan arrived in Dayton, Ohio on July 27, 2014.

Conspiracy to commit wire fraud is a crime punishable by up to 30 years in prison. The court may impose a sentence of up to 8 years in prison for assault of a federal officer and up to 10 years for failure to appear on pretrial release.

Atilan is scheduled for sentencing on July 1, 2015.

U.S. Attorney Stewart commended the cooperative investigation by the FBI and DCIS as well as Assistant United States Attorney Dwight Keller, who is representing the United States in this case. 

COLUMBUS, Ohio – A federal jury convicted Preston J. Harrison, 43, of Lewis Center, Ohio, and his business partner, Thomas E. Jackson, 40, of Powell, Ohio, of defrauding their company’s investors and diverting investors’ funds for their own personal use.  Preston Harrison and his wife, Lovena E. Harrison, 42, were also both convicted of conspiracy to defraud the United States and filing a false income tax return, and Lovena Harrison was convicted of structuring financial transactions to evade currency reporting requirements.

Carter M. Stewart, United States Attorney for the Southern District of Ohio, Caroline D. Ciraolo, Acting Assistant Attorney General for the Justice Department’s Tax Division, Kathy Enstrom, Special Agent in Charge, Internal Revenue Service Criminal Investigation (IRS-CI), and Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI) Cincinnati Field Division, announced the verdict reached today, which was returned following a trial that began on March 16 before U.S. District Judge Gregory L. Frost.

According to court testimony, Jackson and Preston Harrison operated Westerville, Ohio-based Imperial Integrated Health Research and Development, LLC, and developed a product called OXYwater, a beverage that promoters claimed was an all-natural, vitamin-enhanced sports drink that contained added oxygen for improved physical performance.

The defendants engaged in a scheme to deceive the investors in their company about the structure, composition, finances, sales and profits of OXYwater in order to make the company appear to be a lucrative and profitable financial investment.  Jackson and Preston Harrison produced and sent false and fraudulent documents intended to deceive investors, the ultimate purpose of such false statements being for Jackson and Preston Harrison to obtain money invested in the company.  They then misappropriated that money for their own personal use and household expenditures including the purchase of jewelry, a Cadillac Escalade, a BMW, weapons, clothing, home improvements, and a swimming pool.

“This case was about the millions of dollars that the defendants stole from investors to fuel their lavish lifestyle,” Assistant United States Attorney Jessica Kim told the court.

Jackson and Preston Harrison misappropriated approximately $2 million of the investors’ funds between August 2010 and spring 2013.  The defendants’ scheme caused investors to suffer substantial losses when the corporation was forced to declare bankruptcy with no assets.  As a result of the defendants’ conduct, investors lost approximately $9 million.

Jackson and Preston Harrison were each convicted of one count of conspiracy to commit wire fraud, which is punishable by up to 20 years in prison, and one count of conspiracy to commit money laundering, which is punishable by up to 10 years in prison.  Jackson was convicted of 8 counts of wire fraud, which is punishable by up to 20 years in prison, and 12 counts of money laundering, which is punishable by up to 10 years in prison.  Preston Harrison was convicted of 12 counts of money laundering, which is punishable by up to 10 years in prison.

Preston and Lovena Harrison were both convicted of conspiracy to defraud the United States and with filing a false tax return.  Preston Harrison misappropriated approximately $1.1 million in 2011 from his company, which he and his wife, Lovena Harrison, placed in an account in the name of her daycare business. They used the money for personal expenses, and did not report the money as income on their 2011 income tax return.  Lovena Harrison was also convicted of one count of structuring financial transactions to evade currency reporting requirements. Conspiracy to defraud the United States and structuring financial transactions to evade currency reporting requirements are each crimes punishable up to five years in prison, and filing a false tax return is punishable by up to three years in prison.

Preston Harrison and Jackson also face potential forfeiture of $1.1 million, including two vehicles, eight weapons, cash and the contents of a bank account.

All three were indicted by a grand jury on May 20, 2014.

U.S. Attorney Stewart and Acting Assistant Attorney General Ciraolo commended the cooperative investigation by the IRS-CI and FBI, as well as Assistant United States Attorney Jessica Kim and U.S. Department of Justice Tax Division Trial Attorneys Andrew Young and Jason Scheff, who prosecuted the case.

COLUMBUS, Ohio – Gregory D. Braxton, 29, of Columbus, was sentenced in U.S. District Court to 53 months in prison and five years of supervised release for robbing and assaulting a female U.S. Postal Service worker.

Carter M. Stewart, United States Attorney for the Southern District of Ohio and Christopher White, Assistant Inspector in Charge, U.S. Postal Inspection Service (USPIS) announced the sentence handed down today by U.S. District Judge Michael H. Watson.

According to court documents, on January 14, 2014, a U.S. Postal Service supervisor was delivering a parcel in Columbus, Ohio when Braxton parked his vehicle next to the postal vehicle and approached the worker.  When the defendant said the package was his, the postal supervisor asked Braxton his name and for identification.  Braxton got out of the car with what appeared to be his ID in his hand and approached the Postal Service worker.

Without warning, the defendant struck the Postal Service supervisor in the face, causing her serious bodily injury, and then stole the parcel and sped away from the scene.  Investigators later learned that the package contained approximately six pounds of marijuana that had been shipped from an address in California.

Braxton pleaded guilty on October 14, 2014, to using force and violence to rob a U.S. Postal Service worker. He was also ordered to pay restitution to cover the victim’s medical expenses.

“Medical records, presentence interviews, and the Postal Service employee’s testimony demonstrate that Braxton’s unprovoked attack caused his victim significant harm,” U.S. Attorney Stewart said.  “The force of the blow to the victim’s face knocked her unconscious.  We consider the defendant’s violent crime to be serious and we are holding him fully accountable for his conduct.”

U.S. Attorney Stewart commended the investigation by the USPIS, as well as Assistant United States Attorney Dave DeVillers and Special Assistant United States Attorney Brian Martinez, who represented the United States in this case. 

COLUMBUS – A federal grand jury has charged David H. DeMathews, 62, of Columbus, with wire fraud, money laundering, engaging in monetary transactions in property derived from unlawful activity, mail fraud and possessing a firearm as a convicted felon in a 39-count indictment unsealed today.

Carter M. Stewart, United States Attorney for the Southern District of Ohio and Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Field Division, announced the indictment returned March 3.

The indictment alleges that DeMathews used his positions as Director of National Accounts and Executive Vice President of American Escrow and Title Services, Inc. and President of DEMCO Advisory Corporation to execute a financial fraud scheme.

DeMathews allegedly told some victims he would invest their money in the construction of multi-million dollar buildings that were supposed to generate repayment to the investors. He allegedly promised some victims he would invest their money in Starbucks franchise opportunities in Central America, hospital projects in Panama and Nicaragua and a water treatment plant in Florida.

“None of the business ventures were ever consummated and no legitimate income was ever generated,” Assistant United States Attorney Jessica Kim told the court. “Rather than invest the money, DeMathews used it for personal use or to partially pay other investors.”

DeMathews received approximately $911,000 for the purpose of executing his scheme.

Wire fraud, money laundering and mail fraud are crimes punishable by up to 20 years in prison and a $250,000 fine. Engaging in monetary transactions in property derived from a specified unlawful activity and possession of a firearm by a convicted felon carry a maximum sentence 10 years in prison and a $250,000 fine.

U.S. Attorney Stewart commended the investigation of this case by the FBI, and Assistant United States Attorney Jessica Kim, who is prosecuting the case.

An indictment merely contains allegations, and the defendant is presumed innocent unless proven guilty in a court of law.

DAYTON – A federal grand jury returned a three-count indictment against Barry J. Von Der Embse, 53 of Kalida, Ohio, alleging three separate counts of making false financial statements in an indictment returned in Dayton. Von Der Embse is charged with making three separate false statements to the Union Bank Company of Columbus Grove, Ohio in the form of personal financial statements in 2004, 2006 and 2007 while employed as a commercial loan officer with the bank.

Carter M. Stewart, United States Attorney for the Southern District of Ohio, Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Field Office and Joseph Moriarty, Special Agent in Charge, Federal Deposit Insurance Corporation (FDIC) Office of Inspector General, Chicago Field Office, announced the indictment returned today.

The indictment alleges that while employed as a commercial loan officer with Union Bank Company of Columbus Grove, Ohio, Von Der Embse filed materially false personal financial statements. Specifically, Von Der Embse allegedly failed to reveal his ownership of an 85-acre parcel of farmland in Shelby County, Ohio, including 456 head of cattle valued at approximately $421,800. It is also alleged that the defendant did not reveal liabilities in the form of a $12,600 farm loan and a $344,362 line of credit.

Each count of making false financial statements is a crime punishable by up to 30 years in prison and a $1 million fine.

U.S. Attorney Stewart commended the investigation of this case by the FBI and FDIC Office of Inspector General, and Assistant U.S. Attorney Dwight Keller, who is prosecuting the case.

An indictment merely contains allegations, and the defendant is presumed innocent unless proven guilty in a court of law.

COLUMBUS – Philip C. Clark, Jr., 66, David Clark, 59, and Christopher Clark, 61, all of  Newark, pleaded guilty in U.S. District Court to bank fraud and money laundering. The three serve as president, treasurer and vice president of Clark Motor Company in Heath, Ohio.

Carter M. Stewart, United States Attorney for the Southern District of Ohio, Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Field Division, and Kathy Enstrom, Special Agent in Charge, Internal Revenue Service Criminal Investigation (IRS), announced the plea entered into today before U.S. District Chief Judge Edmund A. Sargus, Jr.

According to court documents, the brothers would make deposits and take withdrawals from two banks to make it appear as if they had $7.4 million, when in actuality they owed the banks $1 million. From July 2012 until January 2013, the Clarks unlawfully obtained money and property by false pretenses from Century National Bank and Ohio Heritage Bank.

“In January 2013, the brothers cross-deposited 214 non-sufficient checks between their accounts in order to artificially inflate the bank accounts at each respective bank, taking advantage of the float time in the bank system, thereby causing checks that would normally be returned for non-sufficient funds to be paid or honored by the issuing banks,” Financial Crimes Chief Brenda Shoemaker told the court.

The defendants would also enter into financial agreements and received advance money for the purchase of the same vehicles from more than one bank, and in doing so the three laundered more than $10,000 each by selling criminally derived property. For example, Century National Bank loaned the Clarks approximately $120,000 in January 2013 as an advance for the purchase of 5 vehicles. Unbeknownst to Century National Bank, the brothers had already received an advance from another lender to finance the purchase of at least one of those vehicles.

It was discovered that at that time only 5 of the 33 vehicles Century National Bank had financed were still on the lot at Clark Motor Company. Other lenders had already repossessed the other 28 vehicles because they had titles to the vehicles for the financing they provided the used car dealership.

Each brother pleaded guilty to one count of bank fraud and one count of money laundering.

“IRS Criminal Investigation is committed to unraveling complex financial transactions and money laundering schemes where individuals attempt to conceal the true source of their money," stated Kathy A. Enstrom, Special Agent in Charge, IRS Criminal Investigation, Cincinnati Field Office.

Bank fraud is a crime punishable by up to 30 years in prison and $1 million fine. Money laundering carries a maximum sentence of 10 years in prison and a $250,000 fine.

U.S. Attorney Stewart commended the cooperative investigation by the FBI and IRS, as well as Financial Crimes Chief Brenda Shoemaker, who is representing the United States in this case. 

CINCINNATI, OHIO -- James Jeremy Savage, 41, originally from Springfield, Ohio, was sentenced to 30 months in prison, three years of supervised release, and was ordered to pay restitution to the Internal Revenue Service (IRS) in the amount of $148,307.04 for filing false claims for income tax refunds with IRS. Savage was incarcerated in Ohio state correctional facilities in Warren and Madison counties when he committed this crime.  Savage previously pleaded guilty one count of a multi-count indictment charging Savage with this scheme.

Carter M. Stewart, United States Attorney for the Southern District of Ohio and Kathy A. Enstrom, Special Agent in Charge, Internal Revenue Service Criminal Investigation, Cincinnati Field Office announced the sentence handed down today by U.S. District Judge Susan J. Dlott.

According to court documents, during the 2007 through 2011 income tax years Savage participated in a scheme to defraud the IRS relative to filing false claims for income tax refunds for his jailmates serving prison terms.

From approximately October 22, 2008 to August 24, 2011 while incarcerated, Savage prepared fictitious income tax returns for fellow inmates.  The income tax returns prepared by Savage reported false wages not supported by Forms W-2 or other income documentation and the tax refunds were calculated based on false federal income tax withholdings as well as various tax credits.

Savage knew the inmates, for whom he prepared income tax returns, had not worked and in some cases had been incarcerated for multiple years.  In many instances, Savage prepared multiple income tax returns for the inmates, including returns for the prior tax years that had not been filed.  In an effort to convince the inmates that they were entitled to an income tax refund, Savage said the money was “free money,” a result of “stimulus money” provided by the President, as well as money from back taxes.

Savage caused at least ninety-nine (99) false claims for income tax refunds to be filed with the IRS totaling at least $148,307.04.

Kathy A. Enstrom, Special Agent in Charges, IRS Criminal Investigation, Cincinnati Field Office stated, “This 30-month sentence demonstrates our unwavering commitment to protecting the interests of law-abiding taxpayers. We will continue to partner with the U.S. Attorney’s Office and investigate the criminals who engage in such brazen and fraudulent conduct, ensuring that the only citizens who receive tax refunds are those who are entitled to them.”

U.S. Attorney Stewart commended the investigation by special agents of IRS-Criminal Investigation, and Assistant United States Attorneys Anne L. Porter, who prosecuted the case. 

COLUMBUS – Donald W. Wainwright Sr., 49, of Live Oak, Florida, pleaded guilty in U.S. District Court to 12 charges related to violating the Lacey Act, one count of conspiracy and one count of wire fraud.

Carter Stewart, U.S. Attorney for the Southern District of Ohio, Greg Jackson, Special Agent in Charge, United States Fish and Wildlife Service Office of Law Enforcement, Chief Scott Zody, Ohio Department of Natural Resources Division of Wildlife, Franklin County Prosecutor Ron O’Brien, the Florida Fish and Wildlife Conservation Commission and Georgia Department of Natural Resources announced the plea entered into today before U.S. District Chief Judge Edmund A. Sargus, Jr.

According to court documents, Wainwright illegally trafficked in live white-tailed deer.  Wainwright owned hunting preserves in Logan County, Ohio, and Live Oak, Florida; both preserves were named Valley View Whitetails.  Wainwright illegally shipped deer to Florida from Ohio and attempted to ship deer to Georgia from Ohio. The deer herds involved with these shipments were not certified to be free from chronic wasting disease, tuberculosis and brucellosis. Federal Law requires interstate shipment of deer to be certified to be disease free.  As a result, deer herds in Florida were potentially exposed to these diseases.  Wainwright’s attempted shipment to Georgia was intercepted on I-71 South, about 50 miles from the Ohio River, when Ohio Wildlife officers noticed deer noses and antlers inside a cargo trailer and pulled over a truck driven by Wainwright’s employees.

Wainwright also sold illegal white-tailed deer hunts at Valley View Whitetails of Ohio. The defendant induced clients from around the country to hunt at Valley View Whitetails of Ohio – charging customers from $1,000 to $50,000 to kill deer inside his high fence preserve when Wainwright did not have a hunting preserve license. The customers then took the bucks back to their home states, including: Florida, Michigan, Alabama and Virginia.

Wainwright pleaded guilty to 12 charges related to violating the Lacey Act, one count of conspiracy and one count of wire fraud.  The parties have proposed a sentence of 21 months in prison and a fine of $125,000.00.

“One of the many dangers of illegal wildlife trafficking is its potential to spread disease,” U.S. Attorney Stewart said. “My office is committed to combating this serious threat.”

Under the Lacey Act it is unlawful to import, export, sell or purchase wildlife or transported, or sold: 1) in violation of U.S. law or 2) in interstate or foreign commerce involving any fish, wildlife, or plants taken possessed or sold in violation of State law. When it was passed in 1900, the Lacey Act became the first federal law protecting wildlife.

U.S. Attorney Stewart commended the cooperative investigation by law enforcement, as well as Special Assistant United States Attorney Heather Robinson and Assistant United States Attorneys Peter Glenn-Applegate and J. Michael Marous, who are representing the United States in this case. 

CINCINNATI – Christopher Outlaw, 46, of Moore, S.C., pleaded guilty in U.S. District Court to mail fraud.

Carter M. Stewart, United States Attorney for the Southern District of Ohio and Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Field Division, announced the plea entered into today before U.S. District Judge Michael R. Barrett.

According to court documents, beginning in at least 2005 through August 2012, Outlaw embezzled more than $1.9 million from his former employer.

Outlawwas employed by FTZ Industries, Inc. FTZ is a manufacturer of electrical products for transportation, plant maintenance, marine and custom applications, located in Simpsonville, South Carolina.  FTZ is a division of ILSCO Corporation, which is an electrical connector manufacturing company located in Cincinnati, Ohio.

The defendant embezzled money by impersonating a former vendor of his employer.  Specifically, the defendant opened a bank account in false affiliation with Molex Incorporated, a company that provides electrical components to its customers, which previously included FTZ.  Outlaw submitted to his employer fictitious invoices that appeared to be from Molex.  In reality, however, FTZ had not received any products from Molex because the invoices that Outlaw submitted were fake.  Through the fictitious invoices, Outlaw would direct his employer to send payments to Molex to a mailbox that he had opened in Georgia in Molex’s name.

Mail fraud is a crime punishable by up to 20 years in prison and a $250,000 fine.

U.S. Attorney Stewart commended the investigation by the FBI, as well as Assistant United States Attorney Emily N. Glatfelter, who is representing the United States in this case. 

COLUMBUS – A federal grand jury has charged JoAnna Ochieng, 66, of Columbus, Ohio, with tax fraud, health care fraud and money laundering in an indictment returned in Columbus.

Carter M. Stewart, United States Attorney for the Southern District of Ohio, Lamont Pugh, Special Agent in Charge, Department of Health and Human Services Office of Inspector General, Ohio Attorney General Mike DeWine and Kathy Enstrom, Special Agent in Charge, Internal Revenue Service Criminal Investigation (IRS), announced the indictment which was unsealed today.

Ochieng was charged with five counts of filing false partnership income tax returns, one count of conspiracy to commit health care fraud, one count of health care fraud scheme, 20 counts of health care false statements and three counts of money laundering.

According to the indictment, from November 2011 until March 2013, Ochieng allegedly defrauded Ohio Medicaid in excess of $400,000. The defendant allegedly instructed parents whose children were receiving home health care services to “swap” time sheets with other parents who were providing home health care services to their own children. This would give the false appearance that parents were providing home health services to children other than their own. Ochieng would then allegedly instruct individuals to bill for care, knowing that it was illegal to bill for care that parents provided to their own minor children.

Furthermore, Ochieng allegedly directed these individuals to inflate the hours of care permitted and encourage doctors to sign off on these inflated hours without making a determination of medical necessity. It is also alleged that she falsely billed for split nursing visits.

In addition, Ochieng allegedly defrauded the Ohio Medicaid Program relative to the delivery of and the payment for health care benefits.

The 30-count indictment alleges that Ochieng, who owned and operated Healthy Solutions Home Health Services LLC, under-reported her earnings. The defendant allegedly filed a false partnership income tax return and under-reported the gross receipts for her health services company for 2006 by $536,838; for 2007 by $493,978; for 2008 by $20,920; for 2009 by $185,693 and for 2010 by $287,228.

Healthy Solutions Home Health Services LLC operated at locations in Columbus, Bexley, Washington Courthouse and Hillsboro, Ohio.

It has been alleged that Ochieng transferred approximately $1 million from the U.S. to Turk and Caicos.  The indictment contains two forfeiture allegations relative to funds on deposit at the financial institution in Turks and Caicos, as well as the gross proceeds traceable to these offenses in an amount of money equal to $436,305.69.

Conspiracy to commit health care fraud is a crime punishable by up to 10 years in prison. Filing a false partnership return is a crime punishable by up to three years imprisonment. Health care fraud scheme carries a maximum penalty of 10 years imprisonment. Making health care false statements is a crime punishable by up to five years in prison. Ochieng is charged with two money laundering counts carrying a maximum penalty of 20 years in prison and one money laundering count carrying a maximum penalty of 10 years in prison.

Ochieng was arrested today by agents of IRS Criminal Investigation and Health and Human Services, Office of Inspector General.

“The Medicaid Fraud Control Unit within my office is dedicated to working with federal authorities to investigate and prosecute those who manipulate the health care system to collect money that they are not entitled to,” said Attorney General DeWine.  “Those who believe that they can outsmart the investigators trained to identify this type of fraud should think again.”

“Money gained through illegal sources, such as healthcare fraud, is part of the untaxed, underground economy,” said Kathy A. Enstrom, Special Agent in Charge, IRS Criminal Investigation, Cincinnati Field Office. “To combat healthcare fraud, CI provides financial investigative expertise to multi-agency task forces where we follow the money trail from the crime to the culprit.”

U.S. Attorney Stewart commended the cooperative law enforcement investigation, as well as Assistant U.S. Attorneys Ken Affeldt and Dan Brown and Maritsa Flaherty with the Ohio Attorney General’s Office, who are prosecuting the case.

An indictment merely contains allegations, and the defendant is presumed innocent unless proven guilty in a court of law.

DAYTON – Terry Stuerman, 48, of Beavercreek, was sentenced in U.S. District Court to 27 months in prison for embezzling nearly $300,000 from her employer, Perinatal Partners, LLC, now part of Premier Health.

Carter M. Stewart, United States Attorney for the Southern District of Ohio and Mark Porter, Special Agent in Charge, U.S. Secret Service, announced the sentence handed down yesterday by U.S. District Court Judge Walter H. Rice.

According to court documents, Stuerman served as office and business manager for Perinatal Partners, LLC, a physician-owned medical practice based in Dayton, Ohio. Stuerman was entrusted with substantial responsibility for supervising and managing the business and financial aspects of the medical practice. Beginning in at least August 2007 and continuing until at least June 2012, Stuerman made hundreds of thousands of dollars in unauthorized and fraudulent purchases using her company-issued American Express Card.

The charges were unrelated to Perinatal Partners’ business. For example, she used the business’ American Express to make thousands of unauthorized purchases, including various home improvements and pricey family vacations. In addition to the fraudulent use of Perinatal Partners’ credit card, Stuerman also had Perinatal Partners make lease payments on a luxury vehicle, knowing that such payments were not authorized, as well as receiving tens of thousands of dollars in unauthorized pay.

“Beginning in at least 2007 and continuing over the next half-decade, Terry Stuerman stole nearly $300,000 from her long-time employer, Perinatal Partners,” Assistant U.S. Attorney Alex Sistla told the court. “She stole from doctors providing essential prenatal services in the Miami Valley. She stole from those who trusted her. She stole from one of her best friends. But it wasn’t until Perinatal Partners faced an audit (of which she was aware) that Stuerman finally admitted – and only then partially – that she had been embezzling funds from the practice.”

Stuerman pleaded guilty on June 5, 2014 to wire fraud.

She was also sentenced to three years of supervised release and ordered to pay $299,478.90 in restitution.

U.S. Attorney Stewart commended the investigation by the U.S. Secret Service, as well as Assistant United States Attorneys Alex R. Sistla and Vipal Patel, who prosecuted the case. 

CINCINNATI – A United States District Court jury convicted Christopher Stegawski, 65, of Cleveland, of conspiracy to distribute and dispense prescription drugs, namely oxycodone.

Carter M. Stewart, United States Attorney for the Southern District of Ohio; Ohio Attorney General Mike DeWine; Kathy Enstrom, Special Agent in Charge, Internal Revenue Service Criminal Investigation (IRS), A.J. Groeber, Executive Director of the State Medical Board of Ohio; and Steven W. Schierholt, Executive Director, Ohio Board of Pharmacy, announced the verdict reached Friday, which was returned following a trial that began on February 5 before U.S. District Judge Michael R. Barrett.

According to court testimony, beginning about November 2009 until May 2012, Stegawski worked at a business initially known as Eastside Medical Specialist in Dayton, Ohio. In February 2010, the business moved to Lucasville, Ohio and the name was changed to Lucasville Medical Specialist. Stegawski took over the ownership of Lucasville Medical Specialist and listed his partner and co-conspirator, John Randy Callihan, as an employee.

Stegawski represented himself as a chronic pain management doctor at these clinics and an unnamed clinic located in Southpoint, Ohio. The clinics operated as “pill mills” by selling prescriptions for controlled substances, primarily oxycodone, without a legitimate need for the prescriptions. There was no valid doctor-patient relationship and many of the prescriptions were openly sold and diverted.

Stegawski had a DEA registration number that allowed him to order controlled substances for the clinics. Stegawski received a medical degree in Warsaw, Poland in 1977 and was purportedly trained to specialize in anesthesiology.

As many as 40 patients would visit the clinics each weekday.  In some cases, customers traveled in excess of 200 miles roundtrip to obtain prescriptions from the doctor. Stegawski knowingly prescribed large amounts of prescription drugs to drug abusers and addicts, who were charged $200 cash per visit and received at most a cursory examination.

During the tenure of the pain clinics, many local pharmacies refused to honor any prescriptions written by Stegawski due to the “large quantities of narcotics” and his “catering to customers with prior drug abuse and arrest histories.”

“A majority of the patients interviewed admitted they had no legitimate pain to be prescribed the narcotics,” Criminal Chief Kenneth L. Parker told the court. “They were only going to the pain clinics to easily obtain prescriptions because they were addicted to pain pills, or because they were drug dealers themselves, selling the prescription pills on the street.”

The jury convicted Stegawski of one count of conspiracy to distribute and dispense prescription drugs, one count of conspiracy to launder money and two counts of maintaining a place for illegal distribution of drugs.

Conspiracy to distribute and dispense prescription drugs carries a maximum sentence of 20 years in prison and a $1 million fine; maintaining a place for the purpose of distributing carries a maximum of 20 years imprisonment and a $500,000 fine; money laundering is a crime punishable by up to 20 years in prison and a $500,000 fine.

Stegawski also faces potential forfeiture of a money judgment in his case.

Stegawski was indicted by a grand jury on May 16, 2012, charging him and co-defendant John Randy Callihan in an 11-count indictment. Callihan pleaded guilty to conspiracy to distribute and dispense prescription drugs and money laundering.

Stewart commended the cooperative investigation by agents and officers of the agencies named above including IRS Special Agent Robert Mullins, Ohio Board of Pharmacy Agent Jesse Wimberly, the Ohio Bureau of Criminal Investigation in Attorney General DeWine’s Office, the DEA, the Lawrence County Sheriff Jeff Lawless and the Sheriff’s Drug Task Force, Scioto County Sheriff Marty Donini, and the Riverside Police Department, as well as Criminal Chief Kenneth L. Parker and Assistant U.S. Attorney Timothy D. Oakley, who prosecuted the case.

COLUMBUS – Bryan W. Lehman, 50, of Westerville, Ohio pleaded guilty in U.S. District Court to creating child pornography.

Carter M. Stewart, U.S. Attorney for the Southern District of Ohio, Marlon V. Miller, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI), Franklin County Sheriff Zach Scott, Westerville Police Chief Joseph Morbitzer and members of the Franklin County Internet Crimes Against Children Task Force announced the plea entered into today before Algenon L. Marbley.

According to court documents, investigators searched Lehman’s home after the IP address registered to Lehman was identified as a candidate for downloading child pornography. Upon executing their search warrant, investigators discovered an external hard drive containing numerous images of child pornography and child erotica.

Furthermore, a search of Lehman’s computers revealed approximately 25 homemade videos and 35 images of a minor female in various stages of undress.  Lehman admitted to officers that the minor female was a relative and that he had used a cell phone attached to his belt to record the child – who he estimated was approximately 5-years-old at the time – without her knowledge.

A full forensic examination of Lehman’s hard drive revealed approximately 300 files of child pornography and approximately 600 files of child erotica.

Production of child pornography is punishable by a range of 15 to 30 years in prison.

Lehman served as a volunteer coach for the Westerville Youth Baseball and Softball League in the spring of 2014.

The Franklin County ICAC Task Force is a multi-agency effort dedicated to the fight against computer facilitated crimes against children. The following agencies are members:

Franklin County Sheriff’s Office    Upper Arlington Police Department Grove City Police Department  Columbus Police Department Grandview Heights Police Department Whitehall Police Department Hilliard Police Department Westerville Police Department Homeland Security Investigations U.S. Secret Service Ohio ICAC  Franklin County Prosecutor's Office

This case is being brought as part of Project Safe Childhood, a nationwide initiative by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorney's Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children as well as to identify and rescue victims.

U.S. Attorney Stewart commended the members of the ICAC Task Force for the cooperative investigation, and Assistant U.S. Attorney Heather Hill and Special Assistant U.S. Attorney Jennifer Rausch, who are representing the United States in this case.