District of Oregon

PORTLAND, Ore. - The United States Attorney’s Office, District of Oregon, announces that the Vessel Master of the Adfines East plead guilty to operating a commercial vessel under the influence of alcohol in the Port of Portland. Today, Valeriy Sharykin, 62, a Russian citizen, and captain of a Maltese freighter plead guilty before U.S. Magistrate John V. Acosta.

Defendant Sharykin was charged by information with negligent operation of a commercial vessel, a class A misdemeanor. Sharykin was the licensed Vessel Master on the Adfines East, a 602 foot commercial vessel, weighing over 24,000 gross tons and sailing under the flag of Malta. While conducting an official inspection of the vessel on April 8, 2013, Coast Guard Port State Control examiners from Marine Safety Unit Portland suspected that defendant, the Master of the vessel, was intoxicated based on their observations of his behavior and smell. Coast Guard law enforcement personnel from Station Portland and Coast Guard Investigative Service responded, used a breathalyzer and took the vessel Master into custody with a Blood Alcohol Content (BAC) that was over four times the legal limit.

In effort to eliminate sub-standard ships from U.S. waters, U.S. Coast Guard Port State control examiners board foreign vessels entering U.S. waters on a daily basis. Substandard vessels are those in which the crew, hull, machinery, or equipment such as life-saving, firefighting, or pollution prevention are substantially below the standards required by U.S. law or international convention. It's the U.S. Coast Guard's responsibility to remain vigilant and deter non-compliant vessels from operating in U.S. Waters.

U.S. Attorney Amanda Marshall, said, “Operating a 24,000 ton, 602 foot ship with a blood alcohol level more than four times above the limit is beyond reckless, it’s potentially deadly. The safety of people, property, and the environment on the Columbia River and all US waterways is a top priority for this office. Those who endanger safety in commercial shipping and maritime will be found and prosecuted. I want to thank the Coast Guard for their prompt and professional investigation of this matter bringing this defendant to justice.”

"The Columbia River is a vital transportation mode, source of economic prosperity for the entire Pacific Northwest and an environmental treasure which the Coast Guard is committed to protecting,"said Capt. Bruce Jones, Sector Columbia River Commander. "We will remain vigilant in ensuring those who operate vessels in our waters do so responsibly and in compliance with safety, security and environmental laws. I commend our young but very competent and dedicated Petty Officers for their diligence and thoroughness in the examination of the Adfines East which led to today's arrest."

Defendant was sentenced to two (2) years of probation, including a condition that the defendant is prohibited from sailing, in any capacity, waters subject to the jurisdiction of the United States. Defendant also agreed to pay a $1,000 fine to the court and $1,000 to a community alcohol treatment facility.

This investigation was conducted by the United States Coast Guard Investigative Service, Coast Guard District 13. The case is being prosecuted by Assistant U.S. Attorney Michelle Holman Kerin.

PORTLAND, Ore. – Jose Lizarraras-Chacon, 38, of Nayarit, Mexico, was sentenced today by U.S. District Judge Marco A. Hernandez to 210 months (17.5 years) in prison for heroin-trafficking and illegal reentry. During the fall of 2011, the Portland Police Bureau received information regarding a husband and wife team selling large quantities of heroin. Defendant and his wife, Maria Gonzalez-Torres. (co-defendant) fielded phone call orders from customers for heroin, and then would make deliveries throughout the Portland metro area, often accompanied by their children. Earlier in 2011, the St. Helens Police Department investigated this same husband-wife team, and that evidence was charged in the federal indictment as part of the yearlong conspiracy to distribute heroin.

On November 29, 2011, officers with the Portland Police Bureau’s Drugs and Vice Division (DVD) arranged for a controlled purchase of heroin from this duo. Co-defendant Gonzalez-Torres answered the call, made the deal, and indicated they would be on their way to deliver shortly. Surveillance officers observed defendant leave their apartment carrying a baby in a car seat and enter one of the family vehicles. Gonzalez-Torres followed her husband into their vehicle, along with two other children (ages 7 and 4). Officers stopped the car as it was traveling towards the agreed-upon delivery location.

During the traffic stop, a female officer conducted a pat-down search of Gonzalez-Torres and located approximately five ounces of heroin concealed in her bra. There was also over $300 in the diaper bag. Officers conducted a search of the family’s apartment on East Burnside at 179th, and seized over $84,000 in U.S. currency stashed all over the residence. Agents also seized approximately 470 grams of heroin hidden within a diaper genie and a .45 caliber semi-automatic firearm in a hall closet. Gonzalez-Torres admitted that she had been involved in her husband’s heroin business and had not held legitimate employment for four years. She explained that she received $1100 per month in public benefits. When asked about all the cash in her apartment, she said that she and her husband were saving money to build a home in Mexico.

In 2010, defendant was convicted of unlawful delivery of heroin in Clackamas County, after which he was deported to Mexico. He returned to the United States illegally, and continued to distribute heroin. This case was investigated by the Portland Police Bureau, the St. Helen’s Police Department, the DEA, and the U.S. Department of Agriculture Office of Inspector General. The case was prosecuted by Assistant U. S. Attorney Leah K. Bolstad.

Victim Ends Up In Hospital on Three Separate Occasions After Violent Attacks by Domestic Partner

PORTLAND, Ore. – Casey Marcus Lillie, 26, of the Warm Springs Indian Reservation, pled guilty today before U.S. District Judge Michael W. Mosman to one count of domestic assault by an habitual offender. The maximum sentence for domestic assault by an habitual offender is ten years in prison, a fine of $250,000, and three years of supervised release. Sentencing is scheduled for June 20, 2013. Lillie is currently in the custody of the United States Marshals Service.

“The U.S. Attorney’s Office is committed to building and sustaining safe and secure Native communities across Oregon,” said Amanda Marshall, United States Attorney for the District of Oregon. “Consistent with enhancing the prosecution of domestic violence offenders in Indian Country, this prosecution represents a step in the right direction of holding domestic violence offenders accountable.”

According to the prosecutor’s statements in court, on December 12, 2012, Lillie assaulted a woman with whom he had been cohabitating as an intimate partner. Lillie struck the victim with his hands and kicked her in the face with his feet. The assault caused extensive bruising to the victim’s face. The defendant battered the victim so severely that one of her eyes was temporarily swollen shut. The victim’s injuries required her to be transported to Mt. View Hospital in Madras, Oregon, for medical attention.

On two separate prior occasions, in November 2011 and March 2012, the defendant was previously convicted in the Warm Springs Tribal Court for assault and battery, as well as abduction, against the same victim. Both of those prior assaults also resulted in the victim being transported to Mt. View Hospital for treatment of her injuries.

The case was investigated by the Warm Springs Police Department and the FBI’s Bend, Oregon office. Assistant U.S. Attorney Craig Gabriel is prosecuting the case.

After Decades of Living Off of Stolen Funds, Husband, Wife and Son Appear in Federal Court for Sentencing

PORTLAND, Ore. - On Wednesday, March 20, 2013, Archie Cabello, 65, Portland, Oregon, was sentenced by the Honorable Robert E. Jones in United States District Court, to twenty years in federal prison for his role in stealing $3 million from an Oregon Armored Services armored car he was driving on December 6, 2005. Cabello had previously pleaded guilty to conspiracy to commit bank larceny, possession of stolen bank funds, making false statements on credit applications, making and subscribing to a false income tax return, and money laundering.

Judge Jones also sentenced Cabello’s wife, Marian Cabello, age 60 and his son Vincent Cabello, 40, to fifteen months in prison each for their roles in the armored car theft scheme. Marian and Vincent Cabello had both previously pleaded guilty to conspiracy to commit bank fraud and conspiracy to commit money laundering. The three were ordered to pay restitution in the amount of $3,755,000 to the victims of the theft.

“The Cabello family spent many years planning and executing their scheme to steal from armored car businesses and banks,” said U.S. Attorney Amanda Marshall. “It is through the diligent efforts of our law enforcement partners, the FBI and the IRS, that these criminals were finally brought to justice.”

Archie Cabello had only very short periods of lawful employment since the late 1960s, and was persistently involved in theft and drug trafficking activity. Archie and Marian Cabello first stole $157,839 from an armored car in 1995 in Milwaukee, Wisconsin. Shortly thereafter, Archie Cabello recruited their son Vincent to participate in a scheme to commit another theft. In 1998, Vincent Cabello obtained employment as a vault guard in a commercial building. Thereafter, Archie and Vincent Cabello staged a heist in which Archie Cabello used a hat, a beard, and a BB gun as props and in which Vincent Cabello, posing as the victim, was hand and leg cuffed while Archie Cabello stole $730,000 in $20 bills. No one was charged in either the 1995 or the 1998 thefts.

The Cabellos moved to Portland in 1999, and Archie and Vincent Cabello got jobs with delivery or security companies. In early 2005, Archie Cabello left a better paying job in order to take a position with Oregon Armored Services as a driver of an armored truck. On December 6, 2005, Vincent Cabello received a call from Archie Cabello that they were going forward with their plan to steal money from the truck. Over seven million dollars in currency was on the armored car that day, including two shrink-wrapped bricks containing $1.5 million each in hundred dollar bills. Archie Cabello drove the armored car to a prearranged location and provided Vincent Cabello with access to the back of the truck. Vincent Cabello took the two shrink-wrapped bricks containing a total of $3 million. Archie Cabello then drove the armored truck several blocks away, handcuffed himself to the door, and flagged down a citizen to call the police. Meanwhile, Vincent Cabello drove the stolen money to a privately-owned safe deposit box company in Bellevue, Washington that Archie Cabello had rented.

Since December 2005, the three Cabellos spent about $1,000,000 of the stolen funds. They used more than 100 credit cards to pay living expenses, then used the stolen cash to pay their large credit card bills. Archie Cabello failed to report his $1.5 million share of the stolen funds on his 2005 income tax return. This omission resulted in additional taxes of over $500,000 owed by Archie Cabello to the IRS.

In February 2012, Vincent Cabello disclosed to the FBI and IRS the location of the remaining stolen money in Bellevue, Washington, as well as hiding places for money and keys to the safe-deposit box located in the Cabello home. Government agents seized nearly $2 million of the money the Cabellos had hidden in the safe deposit box and in consumer product containers modified with false bottoms.

“Most American families get by with hard work and sacrifice. The Cabellos, on the other hand, spent years scamming the system, stealing millions of dollars to pay their bills,” said Greg Fowler, Special Agent in Charge of the FBI. “Now, they are rightly being held accountable for their crimes thanks to the great partnership between the FBI and IRS.”

“Most criminals steal money because they want to spend money. The problem with spending stolen money is that it leaves a trail despite the criminal’s best efforts to hide their tracks,” said Steven J. Bellis, Assistant Special Agent in Charge of IRS Criminal Investigation in the Pacific Northwest. “The problem with leaving a trail, for criminals, is that the Special Agents of IRS Criminal Investigation excel at following the money and are committed to working with our law enforcement partners to ensure that criminals are apprehended and held responsible for their actions.”

Archie Cabello was first arrested in December 2010, released, and arrested again in February 2012 for violating the terms of his release. He has been in custody since that time.

The case was jointly investigated by the Federal Bureau of Investigation and the Internal Revenue Service, Criminal Investigation, and Assistant U.S. Attorneys Thomas Edmonds and Claire M. Fay prosecuted the case.

EUGENE, Ore. – On March 19, 2013, Demarcos Montel Wright, 33, of Springfield, Oregon, was sentenced by U.S. District Court Chief Judge Ann Aiken to 77 months in federal prison for possession with intent to distribute crack cocaine and felon in possession of a firearm.  Upon his release from prison, Wright will be on supervised release for three years.

On March 13, 2012, Springfield Police Department detectives executed a search warrant on Wright’s person and his residence in Springfield, Oregon.  Wright had a small amount of crack cocaine on his person.  At Wright’s residence detectives located approximately one ounce of crack cocaine, scales and three pistols.  One pistol was stolen and another had an extended capacity magazine.  Wright admitted that he was involved in distributing cocaine.  Wright was previously a member of the Gangster Disciples gang.

This case was investigated by the Springfield Police Department, the Drug Enforcement Administration, the Bureau of Alcohol, Tobacco, Firearms and Explosives and was prosecuted by Assistant U.S. Attorney Jeffrey S. Sweet.

Vehicular Homicide Occurred on the Umatilla Indian Reservation

PORTLAND, Ore. –Today, Roberto Medellin, 54, of Pendleton, was sentenced 21months in prison by U. S. District Judge Ancer L. Haggerty for vehicular homicide. On December 10, 2012, the defendant pled guilty to involuntary manslaughter. Judge Haggerty ordered the defendant to spend three years on supervised release after he is released from the Bureau of Prisons. As conditions of supervised release, the defendant must not possess or consume alcohol. Judge Haggerty ordered the defendant to surrender to the Bureau of Prisons on May 2, 2013.

“This case is another tragic reminder that drinking and driving kills,” stated U.S. Attorney Amanda Marshall. “Vehicular homicide is a serious crime with long lasting consequences for families and communities. My office will vigilantly prosecute these cases in Indian Country.”

According to the prosecutor’s statements in court, on May 14, 2012, on the Umatilla Indian Reservation, defendant Roberto Medellin was driving his jeep on a highway in which Misty Dawn Sheoships, a member of the White Mountain Apache Tribe, was a front seat passenger. Medellin’s vehicle went off the highway, crashed into a ditch, and Sheoships died as a result due to severe head and neck trauma. Witnesses called 911 to report the crash.

In a mirandized statement, Medellin said that he had been drinking earlier in the afternoon, prior to going out driving with Sheoships, and that he had fallen asleep at the wheel. He also said, in essence, that he knew he was too tired to continue driving and should have pulled over to rest. Medellin was taken to the hospital due to complaints of body stiffness and just under two hours following the crash, a hospital blood draw revealed that defendant’s blood alcohol content was still 0.096, which is in excess of the legal driving limit of 0.08.

The federal case was investigated by the Umatilla Tribal Police Department and the FBI’s office in Pendleton, Oregon. Assistant U. S. Attorney Craig Gabriel prosecuted the case.

Geoffrey Montani and Kenneth Jones Sentenced for Submitting Fraudulent Mortgage Loan Applications

PORTLAND, Ore. – Geoffrey Montani, 36, and Kenneth Jones, 50, both of Portland, Oregon, were sentenced to 15 months in prison in separate hearings following their convictions for wire fraud in connection with a mortgage fraud scheme. Montani was sentenced by the Honorable Robert E. Jones on Friday March 15, 2013. Jones was sentenced by the Honorable Anna J. Brown on Thursday, March 7, 2013. In addition to the prison sentence, each was ordered to pay restitution in an amount exceeding $1.4 million dollars

In mid-2005 through April 2007, Montani and Jones bought and resold (“flipped”) houses in the Portland metropolitan area. Rather than sell these houses to real buyers in arms-length negotiations, the defendants, in 37 separate transactions, knowingly sold the houses to straw-buyers provided by another member of the scheme, Marty Folwick. Folwick was convicted in 2008 and sentenced to 63 months in prison.

The scheme, in essence, worked as follows: Montani and Jones purchased residential houses in the Portland area with money provided by Montani’s father, Stephen Montani, and other “hard money” investors. In some cases, remodeling was done on the house after purchase. Rather than listing the house for resale through a realtor or other traditional means, Montani and Jones contacted Folwick, told him they had a property for sale at a set price and solicited him to produce a straw-buyer for the property in exchange for a kickback following closing. These straw-buyers had no intent to live in the property or pay the monthly mortgage, but they allowed (or were duped into allowing) their name and credit score to be used on the mortgage application, on the false promise that they would become successful real estate investors. Once a straw-buyer was identified, a mortgage application was prepared by Montani and Jones or their associates for the straw-buyer to sign. Montani and Jones knew that each application contained false information and would be submitted to a lender for approval based on the false information in the application. In a number of cases, Montani and Jones created false supporting documentation for inclusion with the application. Once the mortgage loan was approved, the property was sold to the straw-buyer; thereafter Montani and Jones paid off the hard money loan and divided the significant profits between themselves and others. In every case, the property subsequently fell into foreclosure, causing losses to the mortgage lender. The losses on the 37 properties identified by the government for prosecution totaled $1.9 million dollars.

U. S. Attorney for the District of Oregon Amanda Marshall said, “Mortgage fraud committed during the housing bubble of 2005-2008 continues to impact the livability of our community. These convictions demonstrate that the Department of Justice remains committed to investigating and prosecuting those who are responsible for the damage done to our neighborhoods and financial institutions.”

The investigation was initiated by the Portland office of the Federal Bureau of Investigation. The case was prosecuted by Assistant U.S. Attorney Scott Erik Asphaug.

Richard Tietjens Alleged to Have Amassed Thousands of Videos of Children Being Sexually Abused

PORTLAND, Ore. – Richard Tietjens, 62, of Newberg, was arrested and arraigned today before U.S. Magistrate Judge Paul Papak, on a federal indictment charging him with multiple counts of transportation and possession of child pornography. A grand jury returned the indictment earlier this week. The maximum penalty, if convicted, is up to 20 years of in prison, per count, for transporting child pornography, and up to 10 years in prison for possession of child pornography. The transportation charges also carry a mandatory minimum term of five years in prison.

Tietjens is charged with four counts of transportation of child pornography between July and August 2011. According to the indictment, Tietjens emailed child pornography to four yahoo email accounts between July and August 2011, using the email account mystery_daddy@yahoo.com, and possessed child pornography on December 12, 2011, the date law enforcement executed a search warrant at his residence.

According to statements at Tietjen’s arraignment, the Newberg Police Department seized a desktop computer with four hard drives from Tietjens’ residence in December 2011, and a forensic examination by the case agent revealed that the devices contained more than 10,000 images of child sex abuse, and more than 4,500 videos of children being sexually abused. According to the prosecutor, the Newberg Police also seized two servers with another 12 hard drives connected to them from Tietjens’ garage, which also contained child pornography. One of the servers was allegedly used to download child pornography using a peer-to-peer software program, and another server was unsecured and used by Tietjens and others to store files, including child pornography. The prosecutor stated that the two servers contained more than 15 terabytes of storage space. According to arguments at the hearing, Tietjens had been actively trading child pornography through email, instant messenger service, and the peer-to-peer program, and the prosecutor argued Tietjens was likely addicted to child pornography based on the size of the collection he had amassed. Tietjens is an IT employee who built his own computer at home and built at least one of the servers. The prosecutor stated that the Newberg police seized more computers and at least one additional server from Tietjen’s residence this past Monday, but the police had not yet examined them.

The government requested that Tietjens be detained pending trial. Magistrate Papak continued the hearing until Monday at the government’s request to allow a forensic examiner to conduct a preliminary review of the newly seized computers to determine whether any of the devices contain additional child pornography.

This investigation was conducted by the Newberg-Dundee Police Department. The investigation began as part of an undercover operation regarding online sexual exploitation of children. The forensic examination was conducted by the Newberg-Dundee Computer Crimes Unit.

U.S. Attorney Amanda Marshall praised the work of the Newberg-Dundee Police Department and stated, “The allegations in this case illustrate how innovations in technology have exponentially increased the volume of images of child abuse that one person can amass. Each image of child pornography represents a separate and distinct harm to the child whose abuse is depicted.”

Newberg-Dundee Police Captain Jeff Kosmicki said their Computer Crimes Unit forwarded relevant information to other federal agencies in other jurisdictions that led to additional search warrants being issued and executed.

An indictment is only an accusation of a crime, and a defendant should be presumed innocent unless and until proven guilty in court.

This case is being prosecuted by Assistant U.S. Attorney Jane Shoemaker, Chief of the U.S. Attorney’s Office Violent Crimes Unit, as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals, who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc For more information about internet safety education, please visitwww.usdoj.gov/psc and click on the tab "resources."

PORTLAND, Ore. — Depri Marquis Spenser, 25, of Tacoma, Washington, was sentenced to 10 years in prison today by United States District Judge Michael H. Simon, for transporting two young girls from Washington to Oregon for the purpose of prostitution. On October 17, 2012, Spenser pleaded guilty to one count of transporting a minor across state lines for prostitution. Upon release from custody, Spenser will serve a 10-year period of supervised release. During his supervised release, he must abide by a number of conditions which include a sex offender assessment and treatment program, no contact with minors without approval, restricted access to computers and the Internet, and registration as a sex offender.

“Attention out of state traffickers,” said U.S. Attorney Amanda Marshall. “If you are caught trafficking girls in this district, we will not send you home. We will send you to federal prison for at least ten years.”

"It is our responsibility as law enforcement to protect the children in our shared community," said Greg Fowler, Special Agent in Charge of the FBI in Oregon. "No child should be put on the street. No child should be sold for sex. No child should be subjected to the violence and abuse and exploitation that these kids are. We can and will come after the pimps who profit off these kids. With the public's help, we will continue to target those pimps, and we look to our partners on the FBI's Child Exploitation Task Force to lead the fight."

Spenser was arrested in February 2012, after transporting two 15-year-old girls from Tacoma to Seattle to Portland for the purpose of sex trafficking. In Portland, Spenser caused the girls to post prostitution advertisements on www.backpage.com, a website frequently used by sex traffickers. Several Portland-area men supported Spenser’s illegal trafficking by responding to these advertisements and setting up “dates” with one of the 15-year-old victims. Spenser drove with the victim to area hotels, dropped her off a few blocks away to avoid detection, picked her up afterwards, and then demanded all of the money she received from the “date.”

This case stemmed from a coordinated investigation by members of the Federal Bureau of Investigation’s (FBI) Child Exploitation Task Force (CETF), including the FBI, the Portland Police Bureau’s Minor Victims of Sex Trafficking Unit, and the Washington County Sheriff’s Office. The FBI’s CETF marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children through sex trafficking, as well as to identify and recover victims. CETF members include the Portland Police Bureau, Tigard Police Department, Vancouver Police Department, and Beaverton Police Department. CETF partners include the Multnomah County Sheriff’s Office and the Hillsboro Police Department. The case was prosecuted by Assistant U.S. Attorney Stacie Beckerman.

PORTLAND, Ore. – A Portland man will spend six years in prison after pleading guilty to receiving child pornography. At a sentencing hearing held in federal court this morning, U.S. District Judge Anna J. Brown sentenced Keith Henry Jordan, 53, to 72 months in prison followed by a five-year term of supervised release. Jordan will be subject to stringent conditions of supervision, including prohibitions on associating with minors, and restrictions on his use of computers. Jordan will also be required to participate in sex offender treatment, and must register as a sex offender.

U.S. Attorney Amanda Marshall praised the sentence imposed on Jordan. “We as a society cannot and will not tolerate the sexual abuse and exploitation of children,” she said. “Every time someone uploads, downloads, trades, shares, or views images and videos of child sexual abuse, the children in those images are victimized all over again. By creating a demand for such images, those who collect them encourage the ongoing sexual abuse of children.” She added, “There is nothing innocent or harmless about collecting images depicting the sexual abuse of a child.”

The investigation began when a Clackamas County Sheriff’s detective, assigned to the Interagency Child Exploitation Prevention Team (“INTERCEPT”), learned that a computer user, later determined to be Jordan, was making images of child pornography available for download through a “peer-to-peer” file sharing program. INTERCEPT officers served a state search warrant at Jordan’s residence, then in Milwaukie, Oregon, and seized computer equipment and numerous compact discs. A forensic examination revealed that Jordan had almost 1300 images and over 200 videos graphically depicting the sexual abuse of very young children.

In imposing the sentence, Judge Brown described child pornography and the child pornography industry as an “abominable intrusion” into our society. She noted that it is “difficult” for the victims who appear in the images and videos “to ever have peace,” because the images and videos “can never be removed from the internet.” In determining the sentence, Judge Brown balanced the very serious nature of Jordan’s offense against his age, his lack of recent criminal history, and his health issues. Judge Brown expressed confidence that Jordan was not likely to re-offend following his release from prison.

Reading from a brief, prepared statement, Jordan apologized to the court and to the victims. He said he had “no idea” of the pain and suffering the victims continue to endure because the images of their abuse continue to circulate on the internet, but claimed that he understands now.

This case was investigated by the Clackamas County Sheriff’s Office, the INTERCEPT Task Force, and the U.S. Department of Homeland Security, Homeland Security Investigations. It was prosecuted by Assistant U. S. Attorney Gary Sussman, Project Safe Childhood Coordinator for the U.S. Attorney’s Office in Oregon.

This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse. Launched in May 2006 by the Department of Justice and led by United States Attorneys’ 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 via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.

Former Owner and President of Gladstone Engineering Firm Convicted of Tax Charges

Portland, Ore. — A federal jury today convicted Chester Evans Davis, 56, of Oregon City, of five counts of tax evasion, four counts of failure to file a corporate tax return, and one count of obstructing the internal revenue laws. Davis is the former owner and president of ESA International (formerly ESA NW, Inc.), a Gladstone engineering firm specializing in power system software.

“This verdict shows that wealthy business owners have to pay taxes, just like hard-working people do every day,” said U.S. Attorney S. Amanda Marshall. “Evading taxes and obstructing the IRS are serious crimes with serious consequences.”

The government presented evidence during the four-day jury trial that Davis evaded payment of his federal income taxes for tax years 1999, 2000, and 2001, and evaded assessment of his federal income taxes for tax years 2007, 2008, 2009, and 2010. Davis’ company, ESA NW, Inc., earned millions of dollars in annual revenue, including revenue from federal government agencies such as the Army Corps of Engineers and Bonneville Power Administration. Davis transferred money from his company to various shell corporations and a warehouse bank, and then used the money to purchase more than $5 million in gold bars and coins. Special Agents with the Internal Revenue Service - Criminal Investigation seized over $1 million of that gold, as well as approximately $115,000 in cash, while executing search warrants at Davis’ residence and business. Davis also failed to file corporate returns for ESA NW, Inc., and obstructed the Internal Revenue Service by filing bogus Forms 1099-OID with the IRS. The government presented evidence that Davis currently owes approximately $5 million in state and federal personal income taxes.

The maximum penalty for each count of tax evasion is five years imprisonment and a $100,000 fine; the maximum penalty for obstructing the internal revenue laws is three years imprisonment and $25,000 fine; and the maximum penalty for failure to file tax returns is one year imprisonment and a $5,000 fine.

This case stemmed from an investigation by the Internal Revenue Service - Criminal Investigation. The case was prosecuted by Assistant U.S. Attorneys Craig Gabriel and Stacie Beckerman.

Defendant Ordered to Pay Restitution to I.R.S. and Serve Five Years Probation

PORTLAND, Ore. - Amanda Marshall, U. S. Attorney for the District of Oregon, today announced that on Wednesday, March 6, Jeffry D. Goodrich, age 48, Estacada, Oregon was sentenced to federal probation for five years, the first year to be served living in a residential reentry center. U.S. District Judge Anna Brown also ordered Goodrich to pay restitution to the IRS in the amount of $145,308, and prohibited him from being self-employed or running a business.

Goodrich pled guilty on June 4, 2012 to willfully failing to file payroll tax returns and remit payroll taxes to the IRS for Eagles View Construction from October 2005 through September 2006. Goodrich was a co-owner of Eagles View Construction and he handled the accounting and payroll for the company. Goodrich withheld payroll taxes from over 30 employees of Eagles View Construction and he gave each employee a W-2 form at the end of 2005 and 2006 showing payroll taxes had been withheld, but he did not file payroll tax returns for the company and he did not remit to the IRS the payroll taxes he withheld.

In November 2005, in an unrelated case, Goodrich pleaded guilty to bank fraud in connection with altering checks from customers of Eagles View Construction and depositing these checks into a personal bank account. In October 2006, Goodrich was sentenced to five months in federal prison, followed by five months home confinement, for this offense.

“Failure to pay payroll taxes is a serious crime because it deprives Medicare and Social Security of needed funds, reduces the money available for the federal government to provide basic services, and gives an unfair competitive advantage over law-abiding businesses,” said U.S. Attorney Marshall. “This office, in partnership with the IRS, will vigorously investigate and prosecute business owners who do not pay their fair share of payroll taxes.”

“When people withhold money from the paychecks of their hard-working employees, that money isn’t meant to be a personal slush fund. Taxes that are withheld from paychecks and not paid over to the government are stolen from the American public,” said Kenneth J. Hines, Special Agent in Charge of IRS Criminal Investigation in the Pacific Northwest.

This case was investigated by the Criminal Investigation Division of the Internal Revenue Service. The case is being handled by Assistant U. S. Attorney Seth D. Uram.

MEDFORD, Ore. — Senior U.S. District Judge Owen M. Panner sentenced Jorge Armando Cisneros, 34, of Medford, Oregon, yesterday to 15 years in federal prison after he pleaded guilty to being a felon in possession of a firearm. Justin Miller, 30, also of Medford, was previously sentenced to 15 years in federal prison for the same offense.

The underlying incident occurred on October 18, 2011, when officers with the Medford Police Department responded to a trespass complaint at a residence. When they arrived, co-defendant Justin Miller was standing in the front yard and appeared to have something concealed in his waistband. Officers ordered Miller to the ground and discovered a loaded Glock .40 caliber handgun in Miller’s waistband. Miller also had a backpack containing digital scales, handcuffs, knives, marijuana, and methamphetamine. Officers determined that defendant Cisneros was present at the residence but had fled out the back door. They searched the area but did not locate Cisneros.

Further police investigation revealed that Miller had obtained the Glock .40 handgun from Cisneros. Cisneros was arrested eight days later during a car stop and admitted giving the Glock .40 handgun to Miller, expecting cash or drugs in return. Cisneros' cell phone contained photos and videos of Cisneros shooting the Glock handgun and other firearms.

Under federal law, any person who possesses a firearm or ammunition after being previously convicted of three violent felonies or drug trafficking crimes is considered an Armed Career Criminal and, if convicted, faces a 15 year mandatory minimum prison sentence. Cisneros is an Armed Career Criminal with six such convictions. These include two convictions for burglary in the first degree, three convictions for felony attempt to elude police, and a conviction for conspiracy to distribute methamphetamine.

Miller is also an Armed Career Criminal, with two prior convictions for burglary in the first degree and a conviction for delivery of methamphetamine, with additional felony convictions for identity theft and possession of methamphetamine.

This case was investigated jointly by the Medford Police Department and the Bureau of Alcohol, Tobacco, and Firearms, and was prosecuted by Assistant U.S. Attorney Douglas W. Fong.

PORTLAND, Ore. – Reaz Qadir Khan, 48, a naturalized U.S. citizen residing in Portland, has been arrested on charges of conspiracy to provide material support to terrorists for the assistance he allegedly provided to an individual who participated in a May 27, 2009, suicide bomb attack at the headquarters of Pakistan’s intelligence service in Lahore, Pakistan, that killed approximately 30 individuals and injured 300 more.

The arrest was announced by Amanda Marshall, U.S. Attorney for the District of Oregon; Lisa Monaco, Assistant Attorney General for National Security; and Gregory Fowler, Special Agent in Charge of the FBI Portland Division.

FBI agents arrested Khan this morning without incident at his residence in Portland. He made his initial appearance today before Magistrate Paul Papak in federal court in Portland, where the charges against him were unsealed and defendant was detained, pending a detention hearing tomorrow, Wednesday, March 6, 2010 at 1:30 p.m. Khan is charged by a federal indictment with one count of conspiracy to provide material support to terrorists. If convicted, he faces a potential maximum sentence of life in prison.

“The indictment unsealed today set forth how Mr. Khan allegedly supported a terrorist who killed dozens of innocent people in Lahore Pakistan,” said U.S. Attorney Amanda Marshall. “The events of May 27, 2009 remind us that terrorism is not defined by Muslims targeting non-Muslims, but is defined by violent extremists targeting anyone they perceive as a threat to their oppressive agenda without regard for the religion, race, or nationality of their victims. We will find and prosecute those who use this country as a base to fund and support terrorists. Dismantling terrorist networks continues to be a top priority for this office and the Department of Justice.”

“Those who provide material support to terrorists are just as responsible for the deaths and destruction that follow as those who commit the violent acts,” said Greg Fowler, Special Agent in Charge of the FBI in Oregon. “The FBI will continue to focus on cutting off the flow of funds that help terrorists train, travel and launch their attacks.”

According to the indictment, from Dec. 14, 2005 through June 2, 2009, Khan conspired with an individual named Ali Jaleel and others to provide material support and resources, and to conceal the nature of such support and resources, knowing they would be used in a conspiracy to kill, maim or kidnap persons abroad. Jaleel was a Maldivian national who resided outside the United States. Jaleel died while participating in the suicide attack on the Inter-Services Intelligence (ISI) headquarters in Lahore on May 27, 2009, according to the indictment.

As part of the conspiracy, Khan allegedly used email and intermediaries to provide advice and financial assistance to Jaleel and his family. Khan allegedly provided Jaleel with advice to help him in his efforts to travel undetected from the Maldives to commit violent jihad and used coded language when communicating with Jaleel to avoid detection. Further, Khan allegedly provided financial assistance so Jaleel could attend a training camp to prepare for an attack such as that carried out in Lahore on May 27, 2009. Khan also allegedly provided financial support and advice to Jaleel’s family while Jaleel traveled to Pakistan and after he died.

In April 2006, Jaleel and a small group from the Maldives attempted to travel to Pakistan to train for violent jihad in Iraq or Afghanistan, but they were detained and returned to the Maldives, where Jaleel was placed under house arrest, according to the indictment.

In 2008, Jaleel allegedly emailed Khan about his plans to travel to Pakistan again, and in response, Khan provided advice to Jaleel on how to avoid detection and offered to arrange for money to be sent to Jaleel. In October 2008, Jaleel allegedly told Khan he needed “$2500 for everything” and asked that Khan take care of his family and educate his children. Khan promised to help Jaleel’s family. Khan later instructed Jaleel to pick up the money he needed to enter the training camp from an individual in Karachi, Pakistan. To arrange for this transfer, Khan allegedly contacted an individual in Los Angeles who he knew could quickly arrange for Jaleel to pick up money in Pakistan. According to indictment, the individual in Los Angeles then arranged for the money to be available for pick-up from the individual in Karachi.

On Nov. 5, 2008, Jaleel wrote Khan that he was about to gain admission to the training camp and that he would have left-over money from the funds that Khan had provided him. Khan allegedly advised Jaleel to keep the extra funds so they could be sent to Jaleel’s two wives in the Maldives and instructed Jaleel to leave a closed envelop with the individual in Karachi.

According to the indictment, on May 27, 2009, Jaleel and two others conducted the suicide attack at the ISI Headquarters in Lahore. The blast resulted in the death of approximately 30 people and injured 300 more. In a video released by the media outlet of al-Qaeda shortly after the attack, Jaleel allegedly made a statement taking responsibility for the attack and he was shown preparing for the attack at a training camp in what is believed to be the Federally Administered Tribal Area of Pakistan. In June 2009, Khan allegedly wired approximately $750 from a store in Oregon to one of Jaleel’s wives in the Maldives.

This case was investigated by the FBI. The prosecution is being handled by Assistant U.S. Attorney Ethan D. Knight from the U.S. Attorney’s Office for the District of Oregon. Trial Attorney David P. Cora, from the Counterterrorism Section of the Justice Department’s National Security Division, is assisting.

The charges contained in the indictment are merely allegations, and the defendant is presumed innocent unless and until proven guilty in a court of law.

For additional information, the attached indictment can be found at this link.

PORTLAND, Ore. – Dwayne Jamal Hubbard, 24, of Portland, Oregon, was sentenced today by U. S. District Judge Anna J. Brown to 168 months in prison, to be followed by a five-year term of supervised release. The federal charges were filed in May 2012 after an investigation led by the FBI’s Child Exploitation Task Force working in conjunction with the Tigard Police Department. On December 10, 2012, Hubbard pled guilty to sex trafficking of a minor, which carries a mandatory minimum of ten years in prison and a maximum of life imprisonment.

Today at his sentencing, the Court found Hubbard qualified as a career offender based on his prior felony convictions, and this status subjected him to enhanced penalties. According to prosecutors, Hubbard met a 17-year-old female online, arranged a meeting, and immediately started encouraging her to engage in commercial sex acts by posting sexual advertisements on Backpage.com. Within days of meeting, defendant took sexually suggestive photographs of her, created online advertisements, and began sending her out to engage in sex acts with strangers in exchange for money. Hubbard continuously pestered her through text messages asking her if she could make him some money.

“This defendant believed being a pimp and selling young women for sex was a low-cost way to earn significant financial benefit,” said U.S. Attorney Amanda Marshall. “My office is committed to changing the cost side of the analysis – if you get caught sex trafficking in this District, we will work with our law enforcement partners to arrest you and seek the kind of stiff penalties that Congress envisioned for this crime.”

In crafting an appropriate sentence, Judge Brown noted the horrific nature of the offense and addressed the negative impact it has in our community. Because Hubbard agreed to accept responsibility for his crime and resolve his case early, the government recommended some downward variance to his guideline range to reach a 14-year sentence. The Court agreed that by resolving early, defendant prevented further harm to the victim that can only be compounded by protracted litigation.

The case was prosecuted by Assistant U.S. Attorney Leah K. Bolstad.

PORTLAND, Ore. – James Rodney Grant, Jr., 36, of Portland, Oregon, was sentenced today by U.S. District Judge Michael W. Mosman to 70 months in prison and three years supervised release following his plea to being a felon in possession of a firearm.

The charges arose after Grant threatened an individual at a bar with a handgun. The police were called and located Grant leaving the scene in a vehicle. Grant tried to flee from the police, but he eventually crashed his vehicle and was arrested. The police found the handgun, a loaded .25 caliber semi-automatic pistol, on the route the defendant had traveled while he fled. Grant was prohibited from possessing firearms because of his prior felony convictions for delivery of a controlled substance, assault III and attempt to elude, robbery I, and assault IV (domestic violence).

This case was investigated by the Portland Police Bureau and ATF, and it was prosecuted by Assistant United States Attorney Fred Weinhouse.

Ivory Joe Watkins Receives Sentence of 65 months in Federal Prison

PORTLAND, Ore. – Ivory Joe Watkins, 37, of Portland, Oregon was sentenced by U. S. District Court Judge Michael W. Mosman to 65 months in prison following his pleas of guilty to two counts of unarmed bank robbery and one count of attempted unarmed bank robbery. Watkins, who had been given the moniker of the “Bling Bandit” because of the jewelry worn during the bank robberies, was also ordered to pay $3,641 in restitution to U.S. Bank. In Watkins’ guilty pleas, he admitted to the following bank robberies:

(1) April 26, 2012 – U.S. Bank, N.E. 122nd Ave.; (2) June 29, 2012 – Wells Fargo Bank (attempted robbery), S.E. 82nd Ave.; (3) July 16, 2012 – U.S. Bank, N.E. 122nd Ave.

These cases were investigated by the Portland Police Bureau and prosecuted by Assistant U. S. Attorney Fred Weinhouse.

EUGENE, Ore. – Lorinda Marie Goodin, 44, a resident of Lane County, Oregon, pled guilty today to committing two armed bank robberies in Multnomah County, two armed bank robberies in Lane County, and to possessing ammunition after having been previously convicted of eight bank robberies. Sentencing is scheduled for May 8, 2013.

According to court documents and statements made in court, Goodin pled guilty to robbing the Bank of the West in Portland on November 8, 2011, the Clackamas County Bank in Gresham on November 14, 2011, and the Pacific Continental Bank in Eugene on August 1, and again on November 25, 2011. Goodwin wore disguises, displayed what appeared to be a large caliber pistol, and threatened to shoot or kill bank tellers during the robberies.

The defendant was arrested on December 7, 2011 by an FBI agent and Springfield police officers after she was seen driving a stolen vehicle in Springfield, Oregon. She had a large caliber toy pistol in her possession. During a subsequent court-authorized search of Goodin’s residence, police found numerous rounds of .22 caliber ammunition.

Goodin also pled guilty in federal court to being a felon in possession of ammunition and agreed to be sentenced as an armed career criminal. She was previously convicted in 2003 for robbing banks in Multnomah, Clackamas and Marion counties.

Goodin further admitted that from August 2011 until her arrest in December 2011, she robbed twenty-five businesses located in Lane County, Multnomah County, Clackamas County, Wasco County and Douglas County. When committing her robberies, Goodin carried what appeared to be a large caliber pistol. During several of these robberies, Goodin had an accomplice.

The maximum penalty for possessing ammunition after being convicted of three violent felonies is 1ife imprisonment with a mandatory minimum 15 year prison term. The maximum sentence for armed bank robbery is a 25 year prison term. Goodin will be sentenced by Chief United States District Judge Ann Aiken on May 8, 2013, and has agreed that she should receive a 275 month federal prison term.

Goodin’s guilty pleas, admissions and agreed sentencing recommendation of 275 months in prison were part of her plea agreement with the United States Attorney’s Office for the District of Oregon, Clackamas County District Attorney Gregory Horner, Douglas County District Attorney Richard Wesenberg, Lane County District Attorney Alex Gardner, Multnomah County District Attorney Rod Underhill, and Wasco County District Attorney Eric Nisley. As part of the overall agreement, Goodin agreed that she will also plead guilty in Oregon state courts to the multiple robberies she admitted committing, and that she should receive a sentence of up to 18 years in prison for each robbery, to be served concurrently with her federal sentence.

This case was investigated by the Federal Bureau of Investigation, Portland Police Department, Clackamas County Sheriff’s Office, Eugene Police Department, Roseburg Police Department, The Dalles Police Department, Milwaukie Police Department, Gresham Police Department, the Springfield Police Department and the U.S. Bureau of Alcohol, Tobacco and Firearms. It is being prosecuted by Assistant U.S. Attorney Frank R. Papagni, Jr.

EUGENE, Ore. – Jose Gonzalez-Alvarado, 32, of Springfield, Oregon, was sentenced today by U.S. District Court Chief Judge Ann Aiken to 108 months in federal prison for possession with intent to distribute methamphetamine. Upon his release from prison, Gonzalez-Alvarado will be on supervised release for five years.

On November 3, 2010, Springfield Police Department detectives contacted Gonzalez-Alvarado in Springfield after receiving a tip that he was going to deliver methamphetamine. Gonzalez-Alvarado was searched and detectives found four ounces of methamphetamine on his person. A residence associated with Gonzalez-Alvarado was also searched and five ounces of methamphetamine, $6,000 in drug proceeds, scales, packaging material, and a pistol were located.

This case was investigated by the Springfield Police Department and the Drug Enforcement Administration and was prosecuted by Assistant U.S. Attorney Jeffrey S. Sweet.

PORTLAND, Ore. - Jacob Tolman, 34, of Portland, Oregon, was sentenced today by United States District Judge Ancer Haggerty to 175 months in prison, to be followed by a four-year term of supervised release. The federal charges were brought after an investigation led by the Clackamas County Sheriff's Office Interagency Task Force (CCITF), which committed experienced narcotics investigators and significant agency resources immediately upon discovery of a heroin overdose victim, Zachary Holland. Holland, 23, a resident of Milwaukie, Oregon, was found dead on Saturday, November 5, 2011. Investigators found drug paraphernalia and residue quantities of black tar heroin. Holland was among the record number of individuals - 143 - who died from heroin overdoses in Oregon in 2011. According to family members, Holland began using heroin after he became dependent on prescription painkillers. Prior to his death, Holland made several attempts to fight his heroin addiction, including attending drug treatment therapy.

According to prosecutors, Tolman is a career offender based on his prior felony convictions. At the time of this offense, Tolman had just been granted pretrial release in Clackamas County where he was pending charges for unlawful distribution of oxycontin. "Heroin continues to wreak havoc on this community, and I applaud the effort of our partners in the Clackamas County Interagency Task Force for their great work in this case and many other investigations that target those who distribute this poison," said U.S. Attorney Amanda Marshall. "Today's 175-month sentence for this defendant is the highest sentence obtained to date in Len Bias cases brought in the District of Oregon. It is our hope that these stiff penalties will dissuade drug dealers who prey on desperate and vulnerable addicts."

The United States Attorney's Office and the Clackamas County District Attorney's Office have made the investigation and prosecution of drug overdose cases a high priority due to the devastating impact drug distribution has in Oregon. Several significant drug dealers who would have otherwise gone undetected, have been arrested, successfully prosecuted, and sentenced to prison in both state and federal court as a result of this combined state and local effort to investigate and prosecute drug overdose deaths.

The case was prosecuted by Assistant U.S. Attorney Leah K. Bolstad and Special Assistant U.S. Attorney Steven Mygrant of the Clackamas County District Attorney's Office.

PORTLAND, Ore. - Jacob Tolman, 34, of Portland, Oregon, was sentenced today by United States District Judge Ancer Haggerty to 175 months in prison, to be followed by a four-year term of supervised release. The federal charges were brought after an investigation led by the Clackamas County Sheriff's Office Interagency Task Force (CCITF), which committed experienced narcotics investigators and significant agency resources immediately upon discovery of a heroin overdose victim, Zachary Holland. Holland, 23, a resident of Milwaukie, Oregon, was found dead on Saturday, November 5, 2011. Investigators found drug paraphernalia and residue quantities of black tar heroin. Holland was among the record number of individuals - 143 - who died from heroin overdoses in Oregon in 2011. According to family members, Holland began using heroin after he became dependent on prescription painkillers. Prior to his death, Holland made several attempts to fight his heroin addiction, including attending drug treatment therapy.

According to prosecutors, Tolman is a career offender based on his prior felony convictions. At the time of this offense, Tolman had just been granted pretrial release in Clackamas County where he was pending charges for unlawful distribution of oxycontin. "Heroin continues to wreak havoc on this community, and I applaud the effort of our partners in the Clackamas County Interagency Task Force for their great work in this case and many other investigations that target those who distribute this poison," said U.S. Attorney Amanda Marshall. "Today's 175-month sentence for this defendant is the highest sentence obtained to date in Len Bias cases brought in the District of Oregon. It is our hope that these stiff penalties will dissuade drug dealers who prey on desperate and vulnerable addicts."

The United States Attorney's Office and the Clackamas County District Attorney's Office have made the investigation and prosecution of drug overdose cases a high priority due to the devastating impact drug distribution has in Oregon. Several significant drug dealers who would have otherwise gone undetected, have been arrested, successfully prosecuted, and sentenced to prison in both state and federal court as a result of this combined state and local effort to investigate and prosecute drug overdose deaths.

The case was prosecuted by Assistant U.S. Attorney Leah K. Bolstad and Special Assistant U.S. Attorney Steven Mygrant of the Clackamas County District Attorney's Office.

PORTLAND, Ore. — Rodger Strampher, 30, of Portland, Oregon, was sentenced to 18 years in prison today by United States District Judge Ancer L. Haggerty, for producing images of a child being sexually abused. On June 25, 2012, Strampher pleaded guilty to one count of producing child pornography. Upon release from custody, Strampher will serve a 20-year period of supervised release. During his supervised release, he must abide by a number of conditions, which include a sex offender assessment and treatment program, no contact with minors without approval, restricted access to computers and the Internet, and registration as a sex offender.

“Protecting our children remains one of the highest priorities of my office,” said U.S. Attorney Amanda Marshall. “We will use every resource available to hold those accountable who prey on the most innocent and vulnerable members of our communities.”

The case arose in connection with the investigation of Michael Marceau and Lisa Ford, a local couple who are currently serving 49-year and 46-year federal prison sentences for producing child pornography. In the course of that investigation, Department of Homeland Security agents found on Marceau’s computer images of a young child being sexually abused. Data embedded in the images indicated the images were taken with an iPhone on March 2, 2009, and the data also revealed the location of the iPhone at the time the images were taken. Agents traced the images to Strampher, and learned that he had produced the images and then traded the images with Marceau via email.

This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ 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 via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.

The case was investigated by the Department of Homeland Security and prosecuted by Assistant U.S. Attorney Stacie F. Beckerman.

David Ovist convicted of submitting fraudulent mortgage loan applications

PORTLAND, Ore. – David Ovist, 45, of Lake Oswego, Oregon, was convicted Friday, February 8, 2013 of the crimes of bank fraud and wire fraud following a ten-day jury trial. Ovist is scheduled to appear before U.S. District Court Judge Anna J. Brown on May 7, 2013 for sentencing on these charges.

Ovist was a licensed mortgage loan broker and the owner of Oregon Mortgage Services, Inc., located in Beaverton, Oregon. The federal indictment charged that Ovist, acting as a residential mortgage loan broker, knowingly prepared, on behalf of eight borrowers, residential loan applications related to 15 different properties that falsified the borrower’s financial qualifications. The applications were then submitted by Ovist to eight different mortgage lenders with the intent that the lenders would approve mortgage loans for those properties based upon the false financial qualifications provided in the loan applications. The jury convicted Ovist of 12 of the 15 counts in the indictment.

“The effects of mortgage fraud committed during the housing bubble of 2006-2008 continue to impact the livability of our community,” said U.S. Attorney Amanda Marshall. “This conviction demonstrates that the Department of Justice remains committed to investigate and prosecute those who wreaked havoc on our financial institutions and real estate markets.”

“Mortgage fraudsters believe their criminal schemes will put them – and their clients – on the easy road to riches,” said Greg Fowler, Special Agent in Charge of the FBI in Oregon. “Our agents work to ensure that these criminals find themselves on the road to federal prison instead. With the help of the community we serve, we will continue to identify those who would subvert the American dream of home ownership and bring them to justice.”

At sentencing, the maximum penalty for each of the three bank fraud convictions is thirty years in prison and a maximum fine of $1,000,000. The maximum penalty for each of the nine wire fraud convictions is twenty years in prison and a maximum fine of $250,000. The actual sentence will be determined under the Federal Sentencing Guidelines based, in part, on the total amount of losses suffered by the mortgage lenders as a result of the loans.

The investigation was initiated by the Portland office of the Federal Bureau of Investigation. The case is being prosecuted by Assistant U.S. Attorneys Hannah Horsley and Scott Erik Asphaug.

PORTLAND, Ore. - Martin Glaves Kuna, 66 of Vancouver, Washington, plead guilty today to one count of wire fraud before the Honorable Judge Michael H. Simon for falsely telling customers that he was certified to perform lead based paint inspections and testing in homes, where children resided, when in fact, he was not properly certified by state authorities to do so.

In response to medical studies on the health hazards presented to children by lead-based paint, Congress passed the Residential Lead-Based Paint Hazard Reduction Act (“Lead Hazard Act”). The Lead Hazard Act authorized the Environmental Protection Agency (EPA) to develop regulations to ensure, among other things, that individuals engaged in lead based paint inspections and testing were properly trained and certified. Oregon’s rules for the certification of individuals and firms engaged in lead based paint inspections and testing prohibit any person or firm to perform lead based paint inspections and testing in target housing or child occupied facilities without first receiving appropriate certification.

The Information that defendant Kuna plead guilty to states that from May 2008 to September 2012, Kuna advertised his services to conduct lead based paint inspections and testing and indicated to individuals via the internet and in person that he was certified to do so. Defendant Kuna, however, had not received the required certification and training to inspect and test target housing or child occupied facilities for lead based paint despite his representations that he had. Over the course of the scheme, defendant Kuna conducted more than ten (10) such inspections. Assistant U. S. Attorney Michelle Holman Kerin told the court during Kuna’s guilty plea that in one instance where defendant Kuna performed lead based paint inspections and testing, children resided in the home and Kuna provided the home owner a false negative for the detection of lead. In January 2012, civil EPA investigators intervened in Kuna’s business activities and ordered him to stop lead based paint inspections and testing. Despite EPA’s order, Defendant Kuna continued to advertise and perform lead based paint inspections and testing through September 2012.

U.S. Attorney Amanda Marshall, said, “Protecting children and families is one of my office’s top priorities. Laws designed to detect lead in housing help keep us safe from the well-documented, deleterious effects of lead exposure. Individuals who lie about their qualifications to perform these tasks endanger the health and welfare of anyone who falls prey to such fraud, but especially endanger the lives and health of children. When criminal conduct puts children and families at risk, we will see that justice is done.”

Tyler Amon, the Environmental Protection Agency’s Special Agent in Charge in Seattle, Washington, said “By offering a service he was not qualified or certified to deliver, defendant Kuna unnecessarily put children and families at risk using unscrupulous and unsafe business practices. Cases like this one, where people could be exposed to a potentially harmful contaminant, will be tirelessly investigated and tenaciously prosecuted.”

This investigation was conducted by Special Agent, Marc Callaghan at the EPA. The case is being prosecuted by Assistant U.S. Attorney Michelle Holman Kerin.

PORTLAND, Ore. – U.S. District Court Anna J. Brown today sentenced Jefferson F. Williams, 49, of Salem, Oregon, to 60 months in prison for distribution of child pornography.

Salem FBI agents searched the Salem home of Williams on March 3, 2011and seized his computer and related equipment. Undercover FBI agents in Texas had been monitoring a peer-to-peer file sharing system which allowed individuals to download and exchange files via the internet. When the Salem computer belonging to Williams and his wife was identified, agents served a search warrant at the home and interviewed Williams regarding his distribution activities. He cooperated fully with law enforcement and admitted his involvement in the file trading program.

A forensic analysis revealed over 1,800 images of child pornography had been downloaded from the internet. The National Center for Missing and Exploited Children identified series images of 18 known victims stored on the seized computer.

Williams, a highly decorated retired U.S. Marine Corps Gunnery Sergeant, and combat veteran, apologized to his family at his sentencing hearing. He had no criminal record and was active in community activities as a volunteer.

The seized computer was ordered forfeited and Williams was ordered to serve five years of supervised release after his release from prison.

This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visitwww.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab “resources.”

Assistant U. S. Attorney John Haub prosecuted the case.

EUGENE, Ore. – Today, Chief U.S. District Judge Ann Aiken sentenced Rhonda Milligan, 42, of Lebanon, Oregon, to 27 months in federal prison for embezzling from her former employer, Entek Manufacturing, Inc., a company in Lebanon, Oregon.  Milligan pled guilty to a single count of wire fraud on May 18, 2012.  She was also sentenced to three years supervised release and must pay restitution in the amount of $848,156.

“This defendant abused her position of trust in her company by stealing hundreds of thousands of dollars to line her own pockets,” commented U.S. Attorney Amanda Marshall.  “This sort of egregious fraud within the corporate setting will not be tolerated.” 

According to the charges, court documents and other information presented in court, Milligan worked as an assistant to Entek’s president and on Entek’s management team for many years.  As part of her responsibilities, Milligan had access to various financial accounts and paid personal bills for Entek’s president and owner.  Milligan used her access to these accounts to embezzle money.  She made more than $540,000 in unauthorized payments through an online electronic payment system to pay her personal credit card expenses and diverted another $293,000 by forging the name of Entek’s president on checks.  Additionally, she skimmed from the company’s petty cash, and, in some cases, Milligan just cut checks for cash directly to herself.  At sentencing, the court found that Milligan embezzled more than $848,000 between 2005 and 2011. 

This case was investigated by the FBI and was prosecuted by Assistant U.S. Attorney Scott E. Bradford.

PORTLAND, Ore. – Pedro Cruz Gonzales, 33, of Portland, Oregon, was sentenced by the Honorable Robert E. Jones to 13 years in federal prison following the defendant’s guilty plea to sex trafficking of a minor. Upon his release from prison, the defendant will serve a five year term of supervised release.

In pleading guilty, the defendant admitted that between August 2011 and September 2011, he recruited, enticed, harbored, transported, provided, obtained, and maintained a minor female knowing and in reckless disregard of the fact that she would be caused to engage in a commercial sex act.

Prior to imposing the sentence, Judge Jones recounted the defendant’s criminal history, his gang membership, the nature of the crime and then noted that the defendant was “a very bad, bad and dangerous man” who “engaged in one of the worst forms of a crime, sex trafficking with a minor.” In imposing the 13 year sentence, the Court directly addressed the defendant and told him, “Society needs to be protected from you.”

“We could not agree with Judge Jones more,” stated U.S. Attorney S. Amanda Marshall. “The prosecution of sex trafficking cases is a priority for the U.S. Attorney’s Office and sentences such as this send a powerful message that sex trafficking is a horrendous crime that we will aggressively prosecute.”

“Mr. Gonzales exploited one of the most vulnerable populations in society, runaway teenage girls, by preying upon their youth, vulnerabilities, and desperate circumstances,” said Multnomah County District Attorney Rod Underhill. “Cases such as this highlight the collaborative efforts of law enforcement and victim service groups in investigating and prosecuting these cases, as well as the continued need for preventative measures to ensure kids never find themselves in this situation in the first place.”

This case was investigated by Portland Police Bureau East Precinct Prostitution Coordination Detail, the Portland Police Bureau’s Minor Victims of Sex Trafficking Unit, the FBI’s Child Exploitation Task Force, and Immigration and Customs Enforcement Homeland Security Investigations. Sexual Assault Resource Center helped with providing victim assistance. Special Assistant U.S. Attorney Glen “J.R.” Ujifusa was the lead prosecutor on the case, and was assisted by Assistant U.S. Attorney Scott Kerin. Mr. Ujifusa is a Multnomah County Deputy District Attorney who also prosecutes sex trafficking cases in federal court as a member of the U.S. Attorney’s Office Gang and Sex Trafficking Unit.

EUGENE, Ore. – Randall Blair Johnson, 54, of Sisters, Oregon, was sentenced yesterday to 41 months in federal prison and was ordered to pay $260,536 in restitution to the IRS and a $50,000 fine after a jury found him guilty of three counts of income tax evasion, three counts of willful failure to file tax returns and one count of witness tampering.

“People who flout the tax laws increase the burden on law-abiding citizens,” stated U.S. Attorney Amanda Marshall. “In this case, the defendant mouthed protest rhetoric, but his real motivation was greed. His sentence shows what happens when someone tries to defy the tax code.”

According to the indictment, Johnson was a realtor and half owner of TR Hunter Real Estate, a real estate company in Florence, Oregon. Johnson’s primary sources of income were from sales of real estate, commissions and, in 2005, the sale of TR Hunter Real Estate. The indictment alleged that Johnson had a history of timely filing income tax returns but filed no returns for 2002 through 2005, despite being required by law to do so.

The evidence at the trial last June proved that Johnson filed federal income tax returns for nearly thirty years. Then, in 2002, he fired his C.P.A., stopped filing returns, stopped paying income tax, and started sending frivolous tax protestor materials to the IRS and Oregon Department of Revenue.

Johnson’s income more than quadrupled from 2002 to 2005 but he paid no income tax, claiming to revenue officials that the tax laws did not apply to him. An IRS revenue agent testified that Johnson had over $260,000 in taxes due and owing for that four-year period. Despite not filing his own income tax returns, Johnson paid property taxes, filed corporate tax returns for TR Hunter Real Estate, and had delinquent income tax returns prepared for his wife.

Chief United States District Judge Ann Aiken increased Johnson’s sentence based on his attempt to influence grand jury testimony. In April of 2009, Johnson provided his brother-in-law and former business partner a letter instructing him to provide false answers to the prosecutor’s questions in the grand jury. Johnson’s attempt to corruptly influence grand jury testimony was the basis of his conviction for witness tampering.

Judge Aiken further increased Johnson’s sentence after finding that he used sophisticated means to conceal income and assets from the IRS. In addition to filing tax protestor materials with the IRS, Johnson sold real estate outside of escrow, transferred property into the names of family members and endorsed third party checks instead of cashing them or depositing them into his bank account. When he sold his interest in TR Hunter Real Estate to his partner in 2005, he insisted the sale not go through escrow, knowing that escrow would report the sale to the IRS.

Judge Aiken ordered Johnson to report to the U.S. Marshals on April 6, 2013 to begin serving his prison sentence.

This investigation was conducted by agents of the Internal Revenue Service Criminal Investigation. The case was prosecuted by Assistant U.S. Attorneys William “Bud” Fitzgerald and Scott Bradford.

MEDFORD, Ore. - Steven Metheny, 42, of Central Point, Oregon, and Levi Phillips, 45, of Grants Pass, Oregon, were indicted last week by a federal grand jury sitting in Medford, Oregon. Metheny was a former Vice President of Carson Helicopters Inc. in Grants Pass, Oregon. Both Metheny and Phillips were charged with conspiracy to defraud the United States Forest Service involving contracts awarded to Carson Helicopters, Inc., in 2008 for helicopter services in firefighting operations. Metheny was also charged in 22 other counts with mail and wire fraud, making false statements to the Forest Service, endangering the safety of aircraft in flight, and theft from an interstate shipment.

An indictment is only an accusation of a crime, and a defendant should be presumed innocent unless and until proven guilty. If convicted, Metheny and Phillips face a maximum sentence of 20 years in prison for the conspiracy to defraud count, and Metheny also faces a maximum sentence of 20 years for each mail and wire fraud count, 20 years for each endangering the safety of aircraft in flight count, 10 years for the interstate theft count, and up to five years for each false statement count.

For additional information, the attached indictment can be found at this link.

The U.S. Attorney's Office is working with the Offices of Inspector General for both the Department of Agriculture and the Department of Transportation in Portland, Oregon and Seattle, Washington, and the FBI and the IRS in Medford, Oregon in the investigation and prosecution of this case. The case is being prosecuted by Assistant U.S. Attorney Byron Chatfield.

PORTLAND, Ore. - After a 14-day trial, Mohamed Osman Mohamud, 21, a naturalized U.S. citizen from Somalia and resident of Corvallis, Ore., was convicted today by a federal jury in the District of Oregon of attempting to use a weapon of mass destruction (explosives) in connection with a plot to detonate a vehicle bomb at an annual Christmas tree lighting ceremony in Portland, Ore.

At sentencing, Mohamud faces a maximum statutory sentence of life in prison. Mohamud was arrested on Nov. 26, 2010, after he attempted to detonate what he believed to be an explosives-laden van that was parked near the tree lighting ceremony in Portland. The arrest was the culmination of a long-term undercover operation, during which Mohamud was monitored closely for months as his bomb plot developed. The device was in fact inert; and the public was never in danger from the device.

"This trial provided a rare glimpse into the techniques Al Qaeda employs to radicalize home-grown extremists. With the verdict today, the jury has held this defendant accountable," Amanda Marshall, U.S. Attorney for the District of Oregon. "I thank the dedicated professionals in the law enforcement and intelligence communities who were responsible for this successful outcome. I look forward to our continued work with Muslim Communities in Oregon who are committed to ensuring that all young people are safe from extremists who seek to radicalize others to engage in violence."

"When an individual concocts a plan to commit mass violence - and is determined to follow through - law enforcement has an obligation to take action to protect the public. Today's verdict shows that they will be held to account," said Lisa Monaco, Assistant Attorney General for National Security. "I applaud all those who worked so diligently to thwart this plot and ensure no one was harmed."

"The verdict returned in the Mohamed Mohamud case highlights the difficult, but important, work that FBI employees do every day. Whether an employee is an undercover agent or analyst or technician - each has a role to play in keeping our community safe while at the same time respecting the freedoms that make this country strong. Indeed, in this country everyone has a right to live, work and worship freely and without fear. FBI employees - in Oregon and around the world - find strength in preserving and protecting these core values," said Gregory Fowler, Special Agent in Charge of the FBI Portland Division.

According to court documents and evidence presented by the government at trial, in February 2009, Mohamud began communicating via e-mail with Samir Khan, a now-deceased al-Qaeda terrorist who published Jihad Recollections, an online magazine that advocated violent jihad, and who also published Inspire, the official magazine of al-Qaeda in the Arabian Peninsula. Between February and August 2009, Mohamed exchanged approximately 150 emails with Khan. Mohamud wrote several articles for Jihad Recollections that were published under assumed names.

In August 2009, according to evidence presented at trial, Mohamud was in email contact with Amro Al-Ali, a Saudi national who was in Yemen at the time and is today in custody in Saudi Arabia for terrorism offenses. Al-Ali sent Mohamud detailed e-mails designed to facilitate Mohamud's travel to Yemen to train for violent jihad. In December 2009, while Al-Ali was in the northwest frontier province of Pakistan, Mohamud and Al-Ali discussed the possibility of Mohamud traveling to Pakistan to join Al-Ali in terrorist activities. Mohamud responded to Al-Ali in an e-mail: "yes, that would be wonderful, just tell me what I need to do." Al-Ali referred Mohamud to a second associate overseas and provided Mohamud with a name and email address to facilitate the process.

In the following months, Mohamud made several unsuccessful attempts to contact Al-Ali's associate. Ultimately, an FBI undercover operative contacted Mohamud via email under the guise of being an associate of Al-Ali's. Mohamud and the FBI undercover operative agreed to meet in Portland in July 2010. At the meeting, Mohamud told the FBI undercover operative he had written articles that were published in Jihad Recollections. Mohamud also said that he wanted to become "operational." Asked what he meant by "operational," Mohamud said he wanted to put an explosion together, but needed help.

According to evidence presented at trial, at a meeting in August 2010, Mohamud told undercover FBI operatives he had been thinking of committing violent jihad since the age of 15. Mohamud then told the undercover FBI operatives that he had identified a potential target for a bomb: the annual Christmas tree lighting ceremony in Portland's Pioneer Courthouse Square on Nov. 26, 2010. The undercover FBI operatives cautioned Mohamud several times about the seriousness of this plan, noting there would be many people at the event, including children, and emphasized that Mohamud could abandon his attack plans at any time with no shame. Mohamud indicated the deaths would be justified and that he would not mind carrying out a suicide attack on the crowd.

According to evidence presented at trial, in the ensuing months Mohamud continued to express his interest in carrying out the attack and worked on logistics. On Nov. 4, 2010, Mohamud and the undercover FBI operatives traveled to a remote location in Lincoln County, Ore., where they detonated a bomb concealed in a backpack as a trial run for the upcoming attack. During the drive back to Corvallis, Mohamud was asked if was capable looking at all the bodies of those who would be killed during the explosion. In response, Mohamud noted, "I want whoever is attending that event to be, to leave either dead or injured." Mohamud later recorded a video of himself, with the assistance of the undercover FBI operatives, in which he read a statement that offered his rationale for his bomb attack.

On Nov. 18, 2010, undercover FBI operatives picked up Mohamud to travel to Portland to finalize the details of the attack. On Nov. 26, 2010, just hours before the planned attack, Mohamud examined the 1,800 pound bomb in the van and remarked that it was "beautiful." Later that day, Mohamud was arrested after he attempted to remotely detonate the inert vehicle bomb parked near the Christmas tree lighting ceremony

This case was investigated by the FBI, with assistance from the Oregon State Police, the Corvallis Police Department, the Lincoln County Sheriff's Office and the Portland Police Bureau. The prosecution is being handled by Assistant U.S. Attorneys Ethan D. Knight and Pamala Holsinger from the U.S. Attorney's Office for the District of Oregon. Trial Attorney Jolie F. Zimmerman, from the Counterterrorism Section of the Justice Department's National Security Division, is assisting.

PORTLAND, Ore. - U.S. District Judge Michael W. Mosman today sentenced John Witty, 67, of Portland, to pay a $206,844 fine and serve five years probation, for lying to the Department of Veteran Affairs (VA) about being a service-disabled veteran. Witty will also be required to perform 100 hours of community service at a veterans' organization.

"The defendant's crime victimized the service-disabled veteran small business owners who deserved to be awarded these government contracts," said U.S. Attorney S. Amanda Marshall. "We will continue to investigate and aggressively prosecute federal procurement fraud."

Witty is the former owner and operator of Gray Bear Construction Company ("Gray Bear"). In November 2012, Witty pleaded guilty to one count of false statements. He admitted he falsely represented to the VA that Gray Bear was a Service Disabled Veteran Owned Small Business (SDVOSB), even though Witty had never been certified as a service-disabled veteran. Witty admitted that as a result of his false representations, the VA awarded Gray Bear approximately $5,849,372 in SDVOSB set-aside contracts from August 2009 through May 2011, and that Gray Bear was not eligible to receive those contracts.

Inspector General George Opfer, Department of Veterans Affairs, stated that, "Mr. Witty is the 15th individual prosecuted during the past year for defrauding a VA program intended to provide preference to service-disabled entrepreneurs whose sacrifices on behalf of our Nation have earned them the right to compete for Federal set-aside contracts. We are diligently investigating others elsewhere who have similarly defrauded this program and expect additional prosecutions. We are committed to ensuring the integrity of all VA programs and will continue to diligently pursue those individuals who, by fraud and deceit, abuse these programs."

This case stemmed from an investigation by the Department of Veteran Affairs, Office of Inspector General. The case was prosecuted by Assistant U.S. Attorney Stacie Beckerman.

Portland, Ore. - Ricky Lee Greenwood, 31, of Portland, Oregon, has been indicted on nine counts of wire fraud, nine counts of filing false claims for tax refunds, and eight counts of aggravated identity theft, the Justice Department and the Internal Revenue Service announced. Greenwood made his initial appearance in court today before U.S. Magistrate Janice Stewart, and entered a plea of not guilty. The defendant was released on pre-trial conditions and ordered to appear for trial on April 2, 2013.

According to the 26-count indictment, Greenwood electronically filed at least 66 false tax returns with fictitious wage and false dependent information, requesting at least $300,000 in fraudulent refunds. Greenwood is alleged to have obtained the names and Social Security numbers of unemployed individuals in order to file fraudulent tax returns in their names. According to the indictment, Greenwood also obtained the social security numbers of children and claimed them on the tax returns of unrelated individuals to maximize refundable credits - such as the Earned Income Tax Credit and the Additional Child Tax Credit - and further inflate the fraudulent refunds. In addition, according to the indictment, Greenwood had the fraudulent refunds delivered to him or deposited into accounts that he controlled.

An indictment merely alleges that crimes have been committed, and the defendant is presumed innocent until proven guilty beyond a reasonable doubt. If convicted, Greenwood faces a maximum sentence of five years in prison for each false claims count, up to 20 years imprisonment for each wire fraud count, and a mandatory two-year sentence on the aggravated identity theft counts. If convicted, he could be subject to fines, mandatory restitution, and a money judgment.

"Investigating refund fraud and identity theft is a top priority for IRS Criminal Investigation," said Richard Weber, Chief, IRS Criminal Investigation. "Be assured that we are serious about investigating these crimes and we will vigorously pursue the criminals who steal from the American taxpayer."

This case was investigated by the IRS Criminal Investigation Stolen Identity Refund Fraud Task Force. Trial Attorneys Leslie A. Goemaat and Todd P. Kostyshak of the Justice Department's Tax Division and Assistant U. S. Attorney Claire Fay are prosecuting the case.

Additional information about the Tax Division and its enforcement efforts may be found at www.justice.gov/tax.

Eugene, Ore. - Denise Richardson, 47, of Roseburg, Oregon, was sentenced to prison for stealing narcotics from the Roseburg Veteran's Affairs Hospital. Richardson is a former pharmacy technician at the Veteran's Affairs Hospital. Chief U.S. District Judge Ann Aiken sentenced Richardson to 24 months in prison and ordered her to pay restitution in the amount of $23,475.23, the amount the VA spent purchasing the narcotics.

After an investigation by the VA OIG and DEA, Richardson was charged with theft of government property for stealing the narcotics. Sentencing documents noted that Richardson had been a pharmacy technician for approximately 18 years and had access to pharmaceuticals including controlled narcotics like Oxycontin, Oxycodone, and Zolpidem (Ambien). Defendant discovered a way to manipulate the system used to track and dispense narcotics at the VA hospital and used it to divert drugs for her personal use and to provide to friends and/or family. Based on review of the pharmacy records, from approximately January 2010 until June 2011, defendant stole over 6000 pills of Oxycodone, Clonazepam, Zolpidem and Oxycontin from the VA pharmacy that cost the VA $23,475.23. The narcotics had a street value of approximately $250,000, but there is no evidence that defendant ever sold them.

Amanda Marshall, U. S. Attorney for the District of Oregon said "Prescription drug abuse is the fastest growing drug problem in the United States, and Oregon has the second-highest rate of opioid drug abuse in the nation. This defendant's diversion of a dangerous drug put countless lives at risk. Our office is committed to prosecuting theft from government agencies, particularly by employees who steal drugs and destroy lives."

Michael E. Seitler, Special Agent in Charge for the U.S. Department of Veterans Affairs, Office of Inspector General, Northwest Field Office, said "Maintaining the integrity of VA's delivery of healthcare to veterans is a critical issue for the OIG. We will continue to aggressively work with the US Attorney's Office, and our law enforcement partners to ensure that those who abuse the VA system for personal gain are brought to justice."

The VA OIG operates a toll-free hotline for anyone to anonymously report fraud, waste, or abuse. The Hotline can be reached at 1-800-488-8244 or via email at vaoighotline@va.gov.

This investigation was conducted by the U.S. Department of Veteran's Affairs, Office of Inspector General, Criminal Investigations Division and the Drug Enforcement Administration and is being prosecuted by Assistant U.S. Attorney Amy E. Potter.

Portland, Ore. - A federal grand jury in Portland has returned an indictment against Shamont Sapp, 49, charging him with mail fraud in a five-year scheme involving false claims of child sex abuse by Catholic priests in four dioceses. Sapp, originally from Harrisburg, Pennsylvania, is alleged to have used "legal mail" while an inmate of the U.S. Bureau of Prisons to file, pursue and litigate the false claims in federal courts from 2005 through 2010. According to the indictment, the false claims caused the dioceses, their representatives, several courts and other entities to expend money, time and other resources to investigate and resolve the claims, which were ultimately denied or dismissed.

The indictment states that the four fraudulent claims sought money damages, and each alleged similar sexual assaults by specified priests when Sapp was a minor in 1978-79. It charges that Sapp had not been sexually assaulted by the priests and, indeed, had not even been present in the dioceses as alleged in his claims.

Fraudulent claims listed in the indictment involved the dioceses of Tucson, Arizona; Covington, Kentucky, and Spokane, Washington, as well as the Archdiocese of Portland, Oregon. In the Covington and Spokane cases, the indictment notes that Sapp falsely alleged sexual assaults by priests in two different cities on the same day, August 18, 1978.

Sapp initially will appear in U.S. District Court in Harrisburg, Pennsylvania, where the government will seek his removal to Portland to face trial on the indictment.

An indictment is only an accusation of a crime, and a defendant should be presumed innocent unless and until proven guilty. If convicted of mail fraud, Sapp faces a maximum sentence of 20 years in prison and a fine of $250,000, as well as mandatory restitution for all damages incurred.

The case has been investigated by the U.S. Postal Inspection Service and is being prosecuted by Assistant U. S. Attorney Stephen F. Peifer.

Defendant filed more than 70 false federal excise tax returns on behalf of his business, Side Pocket Food Company, and owes more than $879,000 in federal excise taxes

Eugene, Ore. - Today, Chief U.S. District Court Judge Ann Aiken sentenced William Myers, 66, of Cottage Grove, Oregon, to serve one year and one day in prison for failing to pay $879,000 in federal excise taxes and for filing more than 70 false federal excise tax returns on behalf of his company, the Side Pocket Food Company. Upon release from prison, the defendant must serve three years of supervised release, including 100 hours of community service each of the three years and pay restitution in the amount of $873,186.88. Pursuant to a plea agreement, defendant admitted that he owes more than $879,000 in federal excise taxes and filed more than 70 false excise tax returns. Additionally, defendant was operating an illegal still inside the company warehouse.

According to court records, the Side Pocket Food Company is a distilled spirits plant, primarily in the business of blending and bottling distilled spirits, in Cottage Grove, Oregon. It purchases bulk alcohol and bulk distilled spirits from manufacturers or bulk distillers, and the Alcohol and Tobacco Tax and Trade Bureau (TTB) issued the company an operating permit to operate as a rectifier (processor), warehouseman, and bottler. As a licensed distilled spirits plant, the company was required to file federal excise tax returns with the TTB and to pay federal excise taxes to the TTB.

Despite collecting federal excise taxes from the company's clients, Meyers failed to pay the federal excises taxes to the TTB. Instead, Meyers and others used this money to pay for personal expenses, including car, house, and credit card payments, and business expenses. When approached by TTB about the excise taxes, defendant engaged in a repeated pattern of evasion, intentionally avoiding TTB's efforts to audit his company and to rectify his federal excise tax situation. Defendant operated the illegal still in the middle of the company warehouse, distilling wine for local wineries. When tested, the distilled alcohol had dangerous levels of lead and copper, creating a public health risk to unknowing members of the community.

U.S. Attorney S. Amanda Marshall noted, "Defendant cheated his clients, the taxpayers, and the regulatory system, acting as if the rules did not apply to him or his business. Business owners need to understand that this type of conduct will not be tolerated. There are legitimate ways, like bankruptcy, to work through difficult financial times. Theft and tax fraud puts individuals and communities at risk, it is illegal, and will land you in jail."

Timothy Marsh, Deputy Director for Criminal Enforcement, Alcohol and Tobacco Tax and Trade Bureau, (TTB) said, "Failure to pay taxes is not a victimless crime. It robs the community of revenue and hurts law-abiding businesses. TTB is committed to ensuring a level playing field where businesses can compete on an equal and lawful basis."

This case was investigated by the Alcohol and Tobacco Tax and Trade Bureau and is being prosecuted by Assistant U.S. Attorney Scott E. Bradford.

MEDFORD, Ore. - Francisco Hernandez-Figueroa, 29, from San Rafael, Mexico and Jaime Eugene Muniz, 28, from Sacramento, California were both sentenced to federal prison for possession of methamphetamine with intent to distribute it. U.S. District Judge Owen M. Panner sentenced Hernandez-Figueroa to 120 months in prison and Muniz to 60 months in prison for each of their drug trafficking offenses, both of their sentences to be served concurrently to their remaining prison terms they received from their state court convictions in 2011.

On March 16, 2001, an Oregon State Police officer stopped Muniz for a traffic violation while driving northbound on Interstate 5. Following the stop, the officer observed numerous things based on his training and experience that were typical of those trafficking in narcotics. A drug detection dog alerted to the presence of drugs in the vehicle and, upon searching, the officer located a hidden compartment built into the center console area with an electronic locking mechanism. The officer discovered eight packages wrapped in black tape inside the compartment. Later laboratory analysis and investigation revealed that the packages contained over 10 lbs. of pure methamphetamine with an estimated street value of $600,700, all destined for Portland, Oregon.

On March 20, 2011, in a separate and unrelated incident, an Oregon State Police officer stopped Hernandez-Figueroa's car on Interstate 5 after observing a traffic violation. Following the stop, the officer observed numerous things based on his training and experience that were typical of those trafficking in narcotics. When the vehicle was searched, the officer determined that the vehicle was equipped with a sophisticated electronic activation system leading to two separate hidden compartments located behind side panels in the rear passenger compartment. The activation system included push button switches hidden in the steering column with switch activation when adjusting the driver's seat. Officers eventually gained access to the hidden compartments and discovered a total of 16 packages wrapped in black duct tape. Later laboratory analysis and investigation revealed that the packages contained over 15 lbs. of pure crystal methamphetamine with an estimated street value of $870,000, destined for Seattle, Washington. Officers also learned that $4,500 in crisp $100 bills that Hernandez-Figueroa was carrying was part of his drug trafficking activity and that he had illegally entered the United States recently for the specific purpose of trafficking in methamphetamine.

Within a few days of their arrest, and based on advice from their defense attorneys, both Muniz and Hernandez-Figueroa immediately demanded to plead guilty and be sentenced in state court on drug charges before their cases could be reviewed by the United States Attorney's office in an attempt to avoid federal prosecution and longer federal prison terms. Muniz and Hernandez-Figueroa were both sentenced to the Oregon Department of Corrections for terms of 59 months and 60 months, respectively.

"The United States Attorney's office will not be deterred in pursuing cases against drug traffickers who attempt to avoid federal prosecution by racing to state court to plead guilty," said S. Amanda Marshall, United States Attorney for the District of Oregon." These were some of the largest seizures of nearly 100% pure methamphetamine in Southern Oregon. The Department of Justice authorized our prosecution because the state convictions and sentences did not adequately vindicate the interest the United States has in prosecuting major drug traffickers."

Sentencing documents noted that these two defendants were squarely in the middle of the chain of distribution of a significant amount of pure methamphetamine and sufficiently connected into the drug trafficking organization that entrusted them with a significant amount and valuable load of illicit drugs on more than one occasion. Both Muniz and Hernandez-Figueroa have since filed for post-conviction relief in Jackson County Circuit Court to set aside their state convictions alleging a substantial constitutional violation related to inadequate defense attorney professional performance.

The cases were investigated by the Oregon State Police and Immigration and Customs Enforcement and were prosecuted by Assistant U.S. Attorney Byron Chatfield.

PORTLAND, Ore. - Timothy Gaines 20, of Portland, Oregon, was sentenced yesterday by U. S. District Judge Michael Simon to 63 months in prison, to be followed by a three-year term of supervised release, for felon in possession of a firearm. This sentence represents the high-end of the sentencing range (51-63 months).

On July 18, 2011, at approximately 8:30 p.m., Portland Police Bureau (PPB) officers responded to multiple reports of shots fired in Northeast Portland near Unthank Park. Dispatch broadcasted reports of six gunshots and suspects on foot near the park. Responding officers contacted a group of young men, including Gaines, who were walking away from the area. Gaines broke from the group and sprinted through Unthank Park while holding his waistband with one hand. Officers observed him make a throwing motion towards the park's bathroom roof, and soon thereafter, officers recovered a loaded firearm from the bathroom gutter. Officers arrested Gaines, and during a search of his person, they recovered two mismatched black knit gloves, recognized by Gang Enforcement Team officers as "shooter gloves."

On August 23, 2011, after a three-day jury trial, defendant was convicted of felon in possession of a firearm. Defendant is a member of the Unthank Park Hustlers, and he has a prior felony conviction for unlawful use of a weapon from 2010. He committed the instant offense just one month after his release from a 15-month prison sentence on his prior conviction. "The danger presented by gang members with loaded firearms cannot be overstated - it is a recipe for homicide, especially in this community where the number of violent gang incidents is surging upwards," said U.S. Attorney Amanda Marshall. "This sentence helps us send the right message to the gang community - gun violence will be prosecuted to the fullest extent possible."

This case was investigated by the Portland Police Bureau (PPB) and the Bureau of Alcohol, Tobacco, and Firearms (ATF). The case was prosecuted by Assistant U. S. Attorneys Leah K. Bolstad and Pam Holsinger.

Eugene, Ore. - Late Tuesday, January 15, 2013, Tamara Sawyer, 49, and Kevin Sawyer, 60, of Bend, Oregon, pled guilty. Mr. Sawyer pled guilty to Count 14 of a 21-count indictment for making false statements to a financial institution. Ms. Sawyer pled guilty to all 21 counts including conspiracy to commit wire fraud, wire fraud, bank fraud, making a false statement to a financial institution, money laundering. They agreed to forfeiture of certain assets and to pay full restitution to the victims of the fraud scheme.

Defendant Kevin Sawyer, a former Bend Police Captain, admitted to lying to a bank to obtain a mortgage. He intentionally misrepresented assets, liabilities, and the source of the down payment. Defendant Tamara Sawyer, a former licensed real estate broker in Bend, Oregon, admitted to lying to investors to obtain their money. She enticed investors by falsely promising high rates of return, typically 12 percent, and secured the investments with promissory notes. Rather than investing the money as promised, she used it to fund their other companies and ventures and to pay personal expenses, including cars, credit cards, and the construction of their vacation home in Mexico. Additionally, as the scheme progressed and investors began to demand a return on their investment, she used new investor money to pay older investors. Defendant Tamara Sawyer caused investors to lose more than $4.4 million.

Sentencing is set for April 30, 2013, at 9:00 a.m. before Chief U.S. District Court Judge Ann Aiken at the federal courthouse in Eugene, Oregon.

This case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service Criminal Investigation Division and is being prosecuted by Assistant U.S. Attorneys Scott E. Bradford and Amy E. Potter.

PORTLAND, Ore. - On January 10, 2013, U.S. District Judge Robert E. Jones found Aleksey Dzyuba, 43, of Milwaukie, Oregon, guilty of distributing heroin on March 31, 2011 to 17-year-old Toviy Sinyayev. After ingesting the heroin, Toviy lapsed into a coma and three days later died, shortly after being removed from life support at Doernbechers Childrens Hospital. The charges against Dzuyba were brought under a federal statute that enhances the penalty for drug distribution to a maximum sentence of life and a mandatory minimum sentence of 20 years, if the use of the drugs results in the death or serious physical injury of another person. Federal cases have been prosecuted under this statute in Oregon since 2004 resulting in approximately 30 convictions pursuant to guilty pleas. In addition to Dzyuba's case, approximately 25 defendants are currently pending heroin distribution-resulting-in-death charges in the District of Oregon under the same statute. The case of U.S. v. Dzyuba is the first heroin overdose case to go to trial in the District of Oregon.

The federal charges stem from an investigation led by local law enforcement agencies including the Milwaukie Police Department, the Clackamas County Inter-Agency Task Force with the assistance of the Clackamas County District Attorney's Office.

"While the defendant's conviction will never account for the tragic loss of this young life, it does bring us some sense of Justice" said U.S. Attorney Amanda Marshall. "Sadly, this is only one of a growing number of opiate overdoses in Oregon. The judgment of the court in this case should serve as a deterrent to other purveyors of this deadly drug. The message should be clear: if you are anywhere in the chain of supply of a drug that leads to death, you are responsible for that loss of life and you will be held to account."

Milwaukie Police Chief Bob Jordan said, "Today's finding of guilty against Aleksey Dzyuba sends the important message that criminals who traffic in heroin will be held accountable for the human tragedy they cause. This case embodies the level of federal-local cooperation needed to bring these criminals to justice."

The case is being prosecuted by Assistant U.S. Attorney Kathleen Bickers and Special Assistant United States Attorney Steve Mygrant.

Eugene, Ore. - On January 9, 2013, Michael Dean Wasson, 53, was sentenced by U.S. District Chief Judge Ann Aiken to the statutory maximum sentence, 113 months and 15 days in federal prison, for unlawful possession of a firearm and ammunition. Upon his release from prison, Wasson will be on supervised release for three years.

On June 29, 2012, Oregon State Police Troopers and Officers with the Lane County Sheriff's Office responded to a call about Wasson threatening to kill his elderly parents and carrying a firearm. Upon arrival, Wasson was armed with a loaded AK-47 type semiautomatic rifle. As Wasson turned towards the officers with the rifle, a Trooper fired a shot at defendant that forced Wasson to drop the AK-47. Defendant has multiple felony convictions, including rape in the first degree.

This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Oregon State Police, and the Lane County Sheriff's Office, and was prosecuted by Assistant U.S. Attorney Nathan J. Lichvarcik. The Lane County District Attorney's Office is also prosecuting Wasson based upon an unrelated alleged assault.

MEDFORD, Ore. - On Monday, January 7, 2013, U.S. District Judge Owen M. Panner sentenced David Maurice Garrick, 43, of Grants Pass, Oregon, to 77 months in federal prison based on his previous guilty plea to being a felon in possession of a firearm.

On April 16, 2012, a Grants Pass, Oregon Police officer observed Garrick riding a bicycle. The officer recognized him from several prior contacts and was aware that Garrick had outstanding warrants for his arrest. Garrick attempted to elude the officer but crashed his bike and fled. The officer gave chase and apprehended Garrick at gunpoint, discovering a loaded .22 revolver concealed in defendant's overalls.

Over the last twenty-five years, Garrick has been convicted of numerous felonies in state court, including supplying contraband, Assault III, unauthorized use of a vehicle, first degree burglary, robbery in the third degree, possession of methamphetamine, and delivery of a controlled substance.

This case was investigated jointly by the Grants Pass Department of Public Safety and the Bureau of Alcohol, Tobacco, and Firearms, and was prosecuted by Assistant U.S. Attorney Douglas W. Fong.

EUGENE, OREGON - On January 8, 2013, Tamara Diane Brown, 41, of Eugene, Oregon, entered a guilty plea in U.S. District Court in Eugene, admitting her involvement in a scheme to sell illegally obtained cellphones through the internet.

In court papers, Brown admitted that while working as an employee of The Pape Group, Inc. in Eugene, she used her corporate authority to order large quantities of Sprint cellphones, which she then diverted and had delivered to her home and the home of her friend. Brown then sold the devices on eBay. The scheme to defraud The Pape Group, Inc. and Sprint took place between February 2010 and October 2011. Brown admitted that during the scheme, she improperly ordered 5,107 cellphones and obtained more than $305,000 from selling them. Brown admitted that she deposited the profits into her personal bank account and spent the proceeds by making a down payment on a residence, for vehicles and other expenses. The Pape Group, Inc. and Sprint were unaware of the fraud during the time it was occurring.

Brown pleaded guilty to one count of mail fraud, which is a felony punishable by up to twenty years in prison. Brown also agreed to pay restitution and forfeit all of the money she made from her scheme.

Chief U.S. District Judge Ann Aiken presided over the case and will sentence Brown on March 20, 2013. The case was investigated by the FBI and is being prosecuted by Assistant U. S. Attorney Chris Cardani.

EUGENE, Ore. - On January 8, 2013, Ryan Lee Hayes, 26, was sentenced by U.S. District Chief Judge Ann Aiken to serve 71 months in federal prison for bank robbery. Upon his release from prison, Hayes will be on supervised release for three years and was ordered by the court to pay restitution in the amount of $1,300.00.

On July 30, 2012, Hayes walked into the Wells Fargo Bank at 99 East Broadway in Eugene, handed the teller a note that explained he was robbing the bank, and demanded that the teller not do anything funny. Hayes left the bank with $1,300.

Prior to the bank robbery, Hayes had committed a string of thefts from local businesses such as REI and Hutch's Bicycle Shop.

This case was investigated by the FBI and the Eugene Police Department, and was prosecuted by Assistant U.S. Attorney Nathan J. Lichvarcik. Hayes' theft cases are being prosecuted by the Lane County District Attorney's Office.