Eastern District of Pennsylvania

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced today that Medicrea International, a French medical device manufacturer, and its American affiliate Medicrea USA Inc., have agreed to pay:

• $1 Million to the United States and participating states to resolve civil whistleblower allegations that the companies, by entertaining U.S.-based physicians during a 2013 conference in France, violated the Anti-Kickback Statute and, through resulting claims to federal healthcare programs, the False Claims Act and similar state statutes; and
   
• an additional $1 Million to the United States to resolve related allegations that the companies violated the physician Open Payments Program (formerly known as the “Sunshine Act”) by failing to fully report those physician-entertainment expenses to the Centers for Medicare & Medicaid Services (CMS).  

The Anti-Kickback Statute prohibits medical device manufacturers from directly or indirectly offering or paying anything of value to induce the referral of items or services, such as device orders or purchases, covered by Medicare, Medicaid, TRICARE, or other federal healthcare programs. The federal settlement resolves allegations that Medicrea (which Medtronic USA Inc., recently acquired) provided items of value in the form of meals, alcoholic beverages, entertainment, and travel expenses to U.S.-based physicians at events surrounding the Scoliosis Research Society’s September 2013 Congress in Lyon, France. The United States alleged that Medicrea provided the benefits to induce the physicians to purchase or order Medicrea’s spinal devices, and that this resulted in false payment claims to federal healthcare programs. 

This settlement also resolves Medicrea’s liability under CMS’s Open Payments Program. As part of the Affordable Care Act, Congress created the Open Payments Program: (1) to provide greater transparency and protection to consumers, by requiring medical device manufacturers and others publicly to disclose certain payments and other transfers of value to physicians; and (2) with the goal of preventing, through such disclosures, payments and benefits from being used to induce physicians and hospitals to prescribe or buy products.

This is among the first settlements to resolve allegations under both the False Claims Act and the Open Payments Program. The settlement follows the Senate Finance Committee’s March 2019 request that HHS-OIG and CMS investigate Open Payments Program non-compliance and pursue enforcement. Manufacturers must ensure accurate and timely Open Payments Program reporting to CMS of all applicable payments or transfers of value, including indirect payments.

The civil settlement includes the resolution of claims brought under the qui tam or whistleblower provisions of the False Claims Act statute. Under those provisions, a private party can file an action on behalf of the United States and receive a portion of any recovery. The suit was filed in the Eastern District of Pennsylvania and is captioned United States of America, et al., ex rel. Dory Frain v. Medicrea USA Corporation, Civil Action No. 16-1986. The whistleblower’s Philadelphia-based attorneys are Michael A. Filoromo, III of Katz, Marshall & Banks, LLP, and Ryan Allen Hancock of Willig Williams & Davidson.  

“Kickbacks undermine the integrity of federal healthcare programs and increase costs to taxpayers,” said Acting U.S. Attorney Williams. “This case demonstrates the Department of Justice’s commitment to ensuring that medical device manufacturers do not use improper relationships to influence physician decision-making and are transparent about the benefits that they provide to physicians.”  

Williams added: “We thank the relator and relator’s counsel for their contributions. Without information from citizens like the relator, detecting fraud and conserving government program funds would be much more difficult.”

“Allegations of kickbacks are concerning as patients rely on their medical professionals to make health care decisions based on their individual medical needs,” said Maureen R. Dixon, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services (HHS-OIG). “We will continue working with the U.S. Attorney’s Office, CMS and our Medicaid Fraud Control Units to protect patients and taxpayers.”

The United States’ investigation and resolution of this matter illustrates its focus on combating healthcare fraud. Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement can be reported to the U.S. Department of Health and Human Services, at 800‑HHS‑TIPS (800-447-8477).

The settled claims are allegations only; there has been no determination of liability.

This case was investigated by the U.S. Department of Health and Human Services Office of the Inspector General, the U.S. Attorney’s Office for the Eastern District of Pennsylvania, the Commercial Litigation Branch of the Justice Department’s Civil Division, as well as the National Association of Medicaid Fraud Control Units (NAMFCU). For the U.S. Attorney’s Office, the investigation and settlement were handled by Assistant United States Attorneys Landon Y. Jones III and Gerald B. Sullivan, and Auditor Dawn Wiggins.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Leo Dignam, 61, of Philadelphia, PA was sentenced to 15 months in prison, one year of supervised release, and was ordered to pay a $7,500 fine by United States District Judge Eduardo C. Robreno for a scheme to defraud the City of Philadelphia of approximately $150,000 over the course of several years.

In November 2020, Leo Dignam pleaded guilty to wire fraud and embezzlement from a program receiving federal funds. At the time of the charged offenses, the defendant was an Assistant Managing Director in the City of Philadelphia Managing Director’s Office and, prior to serving in that position, was a long-time employee of the Philadelphia Parks and Recreation (“PPR”) Department, having risen through the ranks to serve as the Deputy Commissioner for Programs. In these positions, he oversaw the administration of major events in the city, such as the Philadelphia Marathon, the Broad Street Run and the Mummers Parade. Mr. Dignam worked for the City of Philadelphia for approximately 38 years.

Over the course of several years, from 2012 through 2019, Leo Dignam misused two bank accounts he controlled on behalf of the City that existed to support the work of PPR, namely, recreational activities for citizens. In particular, he opened a bank account purportedly to support the activities of PPR in connection with a non-profit organization, the Junior Baseball Federation (“JBF”). The JBF partnered with the Philadelphia Phillies to raise most of its funds through the sale of tickets for Phillies games. The defendant converted funds from this account to pay for personal expenses he incurred on a credit card associated with the JBF account for purchases from retail stores, grocery stores, pharmacies, gas stations, online retailers, and service providers. Dignam also admitted to misusing another account that was created for the benefit of PPR and the citizens of Philadelphia, the Program Advisory Fund Account. The defendant used this account to pay personal expenses by transferring funds directly to a personal bank account, and by using it to pay personal expenses on a Verizon wireless account.

Leo’s brother, Paul Dignam, 58, also of Philadelphia and formerly the Regional Manager for the South Region of Philadelphia Parks and Recreation, also pleaded guilty in November 2020 to charges of mail fraud and embezzlement from a program receiving federal funds in connection with similar misuse of public money, and will be sentenced next week.

“This defendant abused the considerable level of trust placed in him by his superiors and the citizens of Philadelphia,” said Acting U.S. Attorney Williams. “His inexcusable behavior, stealing money from public programs designed to serve city youth and Parks and Recreation supporters, has now been met with swift and serious consequences in federal court. Our Office will continue to hold public employees, especially those in leadership positions, responsible for this type of fraud.”

This case was investigated by the Federal Bureau of Investigation and the Philadelphia Office of the Inspector General, and is being prosecuted by Deputy United States Attorney Louis D. Lappen.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Christopher May, 32, of Paoli, PA, was sentenced to one year and four months in prison, and two years of supervised release by United States District Judge Timothy J. Savage for engaging in an embezzlement scheme through which he stole more than $1.2 million from his former employer.

In February 2021, the defendant pleaded guilty to two counts of wire fraud stemming from this scheme which he perpetrated over the course of about eight months. From roughly October 2019 until May 2020, while employed as a staff accountant at a local e-commerce automotive parts retailer based in Paoli, PA, May made more than 50 unauthorized Paypal transfers of his employer’s funds into his personal accounts. In total, he stole $1,213,500. He immediately spent nearly this entire amount gambling on sports and making payments to pornographic web camera models whom he met on the internet.

To hide and prolong his fraud, the defendant doctored his employer’s bank statements and created fake financial records. He abruptly resigned from his position in June 2020, after an audit at the company raised questions about discrepancies in these documents.

As part of the Court’s sentence, the defendant will be required to pay back all the money that he stole from his employer. When released from prison, May will also be required to attend mental health treatment to address underlying issues that may have contributed to his crimes.

“Our Office takes offenses like embezzlement and financial fraud very seriously,” said Acting U.S. Attorney Williams. “The defendant stole more than a million dollars by abusing his position handling finances for his former employer. We will continue to work with our law enforcement partners to protect innocent individuals and businesses from being victimized by this type of fraud.”

The case was investigated by the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorney Sean P. McDonnell.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Barbara Conway, 62, of Drexel Hill, PA, entered a plea of guilty before United States District Court Judge Michael M. Baylson for stealing money from a meal program for sick and needy individuals which she managed as a contractor for the City of Philadelphia.

In November 2020, the defendant was charged by criminal information with theft from a program receiving federal funds. According to the Information, Conway served as the Food Voucher Coordinator while employed by the Philadelphia Health Management Corporation (PHMC), a public health agency contracted with the City of Philadelphia to administer a food voucher program funded by the federal government. While serving as the coordinator from 2015 through 2019, Conway stole over $35,000 in food vouchers that were supposed to be distributed as part of an emergency assistance package to people living with HIV/AIDS. This initiative is funded by the Ryan White HIV/AIDS Program, a federal program that provides grants to states, cities, counties, and other local organizations to fund care and treatment services for individuals living with the disease.

“Stealing money from federally-funded programs will be met with swift and serious consequences,” said Acting U.S. Attorney Williams. “Appallingly, Barbara Conway victimized people who are already facing the incredibly challenging life circumstance of living with HIV/AIDS and who require emergency assistance to meet basic life necessities while they bravely fight to get well. Our Office will continue to hold public employees and contractors responsible for this type of egregious behavior.”

The case was investigated by the Federal Bureau of Investigation and the Philadelphia Office of the Inspector General, and is being prosecuted by Assistant United States Attorney Richard P. Barrett.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Kenneth Eugene Cherry, Jr., 33, of Philadelphia, PA, was sentenced to fifteen years in prison and three years of supervised release by United States District Judge Harvey Bartle III, for 27 counts of firearms trafficking offenses.

In August 2019, following a jury trial, Cherry was convicted of dealing in firearms without a license, possession and transfer of a machine gun, possession of an unregistered firearm, possession of a firearm with an obliterated serial number, and multiple counts of possession of a firearm by a convicted felon.

Utilizing a confidential source during a year-long investigation, federal agents conducted controlled purchases of a total of 45 firearms – 24 from Cherry and 21 from his co-defendant.  The firearms purchased from Cherry included two Glock “Auto Sear” conversion devices that are classified as machineguns, an unregistered short-barreled rifle, and six additional assault-style rifles. Cherry also provided a large amount of ammunition with the firearms he sold, which were trafficked from Virginia up to Philadelphia to be sold on the street for profit.

“The defendant put large-capacity, semiautomatic weapons on the streets of Philadelphia, significantly contributing to the violent crime problem in our city,” said Acting U.S. Attorney Williams. “Less than one week ago, I stood with our partners at ATF and the Philadelphia Police Department to discuss how the ATF’s NIBIN Van will be a critical resource to expedite ballistics testing of crime guns like the ones this defendant was trafficking. We are working around the clock and are ‘All Hands On Deck’ to put criminals like Cherry behind bars for a long time.”

“Knowingly selling firearms without a license is a violation of federal law, and by doing so, Cherry circumvented the very laws which are designed to protect communities,” said Matthew Varisco, Special Agent in charge of ATF’s Philadelphia Field Division.  “Public safety is ATF’s top priority, and we are committed to working alongside our law enforcement partners to seek justice above anything.”

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone.   The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.

The case was investigated by the Bureau of Alcohol, Tobacco, Firearms & Explosives, and is being prosecuted by Assistant United States Attorney Mark S. Miller.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Jonnel Perkins, 43, of Philadelphia, PA, pleaded guilty to the charge of embezzlement by a bank employee.

According to court documents filed today, the defendant was employed as a Retail Relationship Banker at a bank located in Philadelphia. While she was employed in this position, the Social Security Administration (SSA) conducted a routine audit which identified that a customer of the bank branch where Perkins worked was likely deceased but still receiving monthly electronic benefits from the SSA. The SSA suspended the payments to this account, but due to regulation had to wait seven years before the approximately $200,000 in accumulated benefit overpayments by the SSA could be reclaimed.

In the months prior to the time when the reclamation could be initiated, between June and December 2019, Perkins withdrew all of the funds from this dormant account. A subsequent investigation determined that the customer whose account from which the defendant withdrew funds had been deceased since 1999. In total, Perkins plead guilty to embezzling $207,450 from the deceased customer’s account. With the embezzled funds, the defendant made large cash deposits into her personal bank accounts as well as large cash deposits at casinos in Philadelphia and Atlantic City, totaling over $200,000.

“Bank employees are trusted by their customers and employers to handle money with honesty and integrity,” said Acting U. S. Attorney Williams. “Here, the defendant stole hundreds of thousands of dollars while she was employed in a position of trust at a bank which managed the deceased victim’s account. Our Office will continue to investigate and prosecute this type of fraud in order to protect individual bank account holders and all American taxpayers who pay into the Social Security system.”

“We will continue to pursue those who would misuse Social Security funds for personal gain, particularly those in positions of trust,” said Gail S. Ennis, Inspector General for the Social Security Administration.  “I want to thank the FBI for their partnership, and the U.S. Attorney’s Office for its efforts to bring the charges that led to today’s guilty plea.”

“Jonnel Perkins stole money from someone she figured would never miss it,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “In draining that deceased customer’s account, though, she was ripping off the Social Security Administration and those actually entitled to its benefits. The FBI and our federal partners won’t stand for criminals cheating the U.S. government and the millions of taxpayers who fund it.”

The case was investigated the Social Security Administration – Office of the Inspector General and the Federal Bureau of Investigation, and is being prosecuted by Special Assistant United States Attorney Megan Curran.

PHILADELPHIA – In honor of National Police Week, Acting United States Attorney Jennifer Arbittier Williams recognizes and celebrates the service and sacrifice of federal, state, local, and Tribal law enforcement. This year, the week is observed Sunday, May 9, through Saturday, May 15, 2021.

“This week is a time to honor our law enforcement officers who have made the ultimate sacrifice in service to our nation,” said Attorney General Garland. “I am constantly inspired by the extraordinary courage and dedication with which members of law enforcement act each day, putting their lives on the line to make our communities safer. To members of law enforcement and your families: we know that not a single day, nor a single week, is enough to recognize your service and sacrifice. On behalf of the entire Department of Justice, you have our unwavering support and eternal gratitude.”

“Every year, National Police Week gives us an opportunity to take time to reflect on the sacrifices made by those brave men and women who have devoted themselves to serve the public and protect our communities every day. We especially pay tribute to those who lost their lives to ensure our safety,” said Acting U.S. Attorney Williams. “This week, I ask the residents of the Eastern District of Pennsylvania to join me in saying ‘thank you’ to our nation’s law enforcement officers at all levels of government.”

In 1962, President Kennedy issued the first proclamation for Peace Officers Memorial Day and National Police Week to remember and honor law enforcement officers for their service and sacrifices.  Peace Officers Memorial Day, which every year falls on May 15, specifically honors law enforcement officers killed or disabled in the line of duty.  

Each year, during National Police Week, our nation celebrates the contributions of law enforcement from around the country, recognizing their hard work, dedication, loyalty, and commitment to keeping our communities safe. This year the COVID-19 pandemic has highlighted law enforcement officers’ courage and unwavering devotion to the communities that they have sworn to serve.

During the Roll Call of Heroes, a ceremony coordinated by the Fraternal Order of Police (FOP), more than 300 officers will be honored.  Based on data submitted to and analyzed by the National Law Enforcement Officer Memorial Fund (NLEOMF), of the law enforcement officers who died nationwide in the line of duty in 2020, nearly 60 percent succumbed to COVID-19. Here in the Eastern District of Pennsylvania, six officers died in the line of duty in 2020.

Additionally, according to statistics reported by the Federal Bureau of Investigation (FBI) through the Law Enforcement Officer Killed and Assaulted (LEOKA) Program, 46 law enforcement officers died as a result of felonious acts and 47 died in accidents in 2020.  LEOKA statistics can be found on FBI’s Crime Data Explorer website. 

The names of the 394 fallen officers who have been added in 2020 to the wall at the National Law Enforcement Officer Memorial will be read on Thursday, May 13, 2021, during a Virtual Candlelight Vigil, which will be livestreamed to the public at 8:00 pm EDT. The Police Week in-person public events, originally scheduled for May, have been rescheduled due to ongoing COVID-19 concerns to October 13-17, 2021. An in-person Candlelight Vigil event is scheduled for October 14, 2021.

Those who wish to view the Virtual Candlelight Vigil on May 13, 2021, can watch on the NLEOMF YouTube channel found at https://www.youtube.com/user/TheNLEOMF. The FOP’s Roll Call of Heroes can be viewed at www.fop.net. To view the schedule of virtual Police Week events in May, please view NLEOMF’s Police Week Flyer.   

To learn more about National Police Week in-person events scheduled for October, please visit www.policeweek.org.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Craig Alex Levin, 65, of King of Prussia, PA, was charged by Superseding Indictment with additional child exploitation offenses related to his travel to the Philippines. The defendant, who was previously detained in the Philippines, was deported back to the United States in August 2020 and has been held in federal detention since that time.

The Superseding Indictment contains sixteen counts including nine counts of interstate and foreign travel for the purpose of engaging in illicit sexual conduct with a minor, two counts of sex trafficking of a minor, one count of use of an interstate commerce facility to entice a minor to engage in sexual activity, two counts of distribution of child pornography, one count of transfer of obscene material to a minor, and one count of transportation of child pornography.

The Superseding Indictment alleges that Levin, a former high school teacher for the Lower Merion School District, created and maintained Facebook accounts that he used to communicate with minors in the Philippines for the purpose of enticing them to engage in illicit sexual conduct with him during his visits to the Philippines. In addition, the defendant allegedly used Facebook Messenger to send images depicting minors engaging in sexually explicit conduct and obscene photographs from his residence to minors in the Philippines. Between August 29, 2016 and May 8, 2019, Levin is alleged to have traveled to the Philippines nine times to have sex with minor children. Levin was first indicted with child exploitation offenses related to his travel to the Philippines in February 2020.

“As alleged in the Superseding Indictment, the defendant repeatedly traveled to the Philippines and stayed for months as a time in order to sexually prey on children,” said Acting U.S. Attorney Williams. “If Mr. Levin thought he could get away with these crimes because they occurred on the other side of the world, that was a grave miscalculation on his part. Holding child sexual predators accountable, including those who travel overseas to commit their heinous acts, will continue to be a top priority of our Office.”

“Craig Levin went to extraordinary lengths to sexually exploit children, as alleged in the superseding indictment,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “He repeatedly trekked thousands of miles to the Philippines and ensconced himself there for months, taking advantage of situations of extreme poverty in order to prey on underage girls. Child sexual exploitation is abhorrent anywhere it occurs, and the FBI will continue to go after Americans who travel abroad for that purpose. We’re determined to hold them accountable for the damage they’ve done and prevent them from victimizing anyone else’s child.”

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.

If convicted, the defendant faces a maximum possible sentence of lifetime imprisonment with a mandatory minimum of ten years’ imprisonment, lifetime supervised release, a $4,000,000 fine, and a $1,600 special assessment, and an additional $75,000 mandatory special assessment. 

The case was investigated by the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorney Sarah Damiani and Trial Attorney Austin M. Berry of the Department of Justice’s Child Exploitation and Obscenity Section.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Jesse Golden, 30, of Philadelphia, PA, was convicted today after a three-day trial of illegally possessing a firearm and ammunition as a convicted felon.

In September 2019, the defendant was Indicted following an investigation by the Philadelphia Police Department and Bureau of Alcohol, Tobacco, Firearms and Explosives. In May 2019, a Philadelphia Police officer saw a video on the social media platform Instagram in which the defendant was sitting in a car with another individual and brandishing a distinctive painted-black revolver. Investigators determined that Golden had multiple prior felony convictions, so they obtained a search warrant for the defendant’s residence. During the execution of that warrant they found an unloaded revolver and 100 rounds of ammunition the same caliber as the firearm. The revolver they found matched the look (including the paint job) of the firearm in the Instagram video. Evidence presented at trial showed that testing performed on the gun found DNA that matched the defendant’s DNA.

“The crime of being a felon in possession of a firearm is a serious offense, particularly in a city like Philadelphia, where gun violence is prevalent,” said Acting U.S. Attorney Williams. “As the evidence presented at trial showed, Jesse Golden illegally possessed a gun and flagrantly displayed it, a video of which wound up on social media. Now, Golden is facing a mandatory minimum of fifteen years in prison if the Court declares him an armed career criminal, and he could face as much as life in prison. Our Office is determined to continue doing everything we can to reduce gun violence in Philadelphia by being ‘All Hands On Deck’ to get criminals like Golden off the streets for a long, long time.”

“A felon in possession of a firearm always presents a great danger to our community,” said Matthew Varisco, Special Agent in charge of ATF’s Philadelphia Field Division “The public is very fortunate that the Philadelphia Police Department was able to interdict the defendant before harm could come to anyone. We are committed to making our community safer by working with our local, state and federal partners in identifying and removing armed criminals from our streets.” 

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone.   The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.

The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Philadelphia Police Department, and is being prosecuted by Assistant United States Attorney David Ignall.

PHILADELPHIA—Acting United States Attorney Jennifer Arbittier Williams announced that Incyte Corporation, headquartered in Delaware, has agreed to pay $12.6 million to resolve allegations that it violated the False Claims Act by using a foundation as a conduit to pay the copays of Medicare and TRICARE patients taking Incyte’s drug Jakafi. TRICARE is the health care program for uniformed service members, retirees, and their families.

When a Medicare or TRICARE beneficiary obtains a prescription drug covered by a federal health care plan, the beneficiary may be required to make a partial payment, in the form of a copayment, coinsurance, or a deductible (collectively “copays”). Congress included copays in the programs, in part, to serve as a check on health care costs, including the prices that pharmaceutical manufacturers can demand for their drugs.

Under the Anti-Kickback Statute, a pharmaceutical company cannot offer or pay, directly or indirectly, any remuneration—which includes money or any other thing of value—to induce Medicare or TRICARE patients to purchase the company’s drugs. This prohibition includes the payment of patients’ copay obligations. Payment of those prescriptions in violation of the Anti-Kickback Statute leads to submission of false claims to Medicare and TRICARE and violations of the False Claims Act.

Incyte sells Jakafi, a medication approved to treat myelofibrosis in 2011 and approved to treat other disorders after 2014. Incyte allegedly was the sole donor to a fund that was opened by a nonprofit foundation in November 2011 to assist only myleofibrosis patients. After the fund opened, the government alleges that from November 2011 through December 2014, Incyte used its influence as the sole donor of the fund to have the foundation pay the copays of Medicare and TRICARE patients taking Jakafi that did not have myelofibrosis, and thus were not eligible for assistance from the fund. Incyte managers allegedly pressured the foundation, through phone calls and emails, to provide economic assistance to these ineligible patients, and Incyte’s contractor helped ineligible patients to complete their applications that were submitted to the fund for assistance. The government alleges that through this conduct, Incyte caused false claims for Jakafi to be submitted to Medicare and TRICARE. 

“Pharmaceutical companies cannot skirt the anti-kickback rules by disguising their inducements to federally-insured patients as charitable donations,” said Acting United States Attorney Jennifer Arbittier Williams. “This resolution shows our office’s continuing commitment to holding drug companies accountable for this conduct.”

“Protecting TRICARE is a top priority for the Defense Criminal Investigative Service (DCIS),” stated Special Agent in Charge Patrick J. Hegarty, DCIS Northeast Field Office. “Incyte’s false claims for ineligible patients compromised the integrity of the TRICARE program. Today’s settlement is the result of a joint effort with the U.S. Attorney's Office, DOJ Civil Frauds, and HHS-OIG, and it demonstrates our ongoing commitment to work with our law enforcement partners to investigate those who engage in health care fraud.”

The civil settlement includes the resolution of claims brought under the qui tam or whistleblower provisions of the False Claims Act by Justin Dillon, a former compliance executive at Incyte.  Under those provisions, a private party can file an action on behalf of the United States and receive a portion of any recovery. The qui tam case is captioned U.S. ex rel. Dillon v. Incyte Corp., No. 2:18 -cv-2642 (E.D. Pa.) and was filed by Brian McCormick of Ross Feller Casey LLP in Philadelphia, PA.

“We thank the relator and relator’s counsel for their contributions to this case. Without information from citizens like the relator, detecting fraud and conserving government program funds would be much more difficult,” said Acting U.S. Attorney Williams.

The investigation was conducted by the Department of Defense Office of Inspector General and the U.S. Department of Health and Human Services Office of Inspector General. The investigation and resolution obtained in this action were handled by Assistant United States Attorneys Paul J. Koob and Matthew E.K. Howatt, Deputy Chief Charlene Keller Fullmer, and Auditor George Niedzwicki.  This matter was handled in conjunction with the Justice Department’s Civil Division, Commercial Litigation Branch, Fraud Section’s Senior Trial Counsel Jennifer Cihon.

The claims resolved by the settlement are allegations only and there has been no determination of liability.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Luis Veras-Velasquez, 37, formerly of Philadelphia, PA, pleaded guilty to the charge of aggravated identity theft before United States District Court Judge Gerald J. Pappert related to a scheme to steal income tax refunds.

On April 23, 2015, a federal grand jury returned an Indictment against the defendant, alleging that he engaged in a scheme to obtain tax refunds using stolen identities. According to the Indictment, Veras-Velasquez possessed numerous documents containing the names, dates of birth, and social security numbers of victim taxpayers. Internal Revenue Service records show that more than 20 of those identities were used to seek tax refunds without the knowledge or authorization of the taxpayer named on the return. Before he could answer to these charges in federal court, the defendant fled to Dominican Republic, where he remained for five years. Then in September 2020, Veras-Velasquez boarded a flight from the Dominican Republic to Mexico and was subsequently arrested.

“Veras-Velasquez’ scheme victimized honest taxpayers in two ways: first, by stealing their identities; and second, by trying to rip off the federal government,” said Acting U.S. Attorney Williams. “Now, he will face the consequences – even after attempting to evade justice overseas for five years – as will anybody else who attempts to carry out a similar scheme.”

“Investigating refund fraud and identity theft is a top priority for the Agents in my office,” said Thomas Fattorusso, Special Agent in Charge of IRS Criminal Investigation.  “This individual demonstrated a flagrant disregard for the integrity of the United States tax system and caused harm to those individuals whose identities he stole.  The defendant thought he could flee the country after he committed his crimes, but he could not outrun justice.” 

“Homeland Security Investigations remains committed to investigating those who use stolen identities to steal money from the United States by filing false tax returns and claiming fraudulent tax refunds,” said Brian A. Michael, Special Agent in Charge for Homeland Security Investigations Philadelphia. “The defendant’s guilty plea should serve as a reminder that attempting to defraud the federal government will result in serious consequences.”

If convicted, the defendant faces a mandatory sentence of two years in prison.

The case was investigated by the Internal Revenue Service and Homeland Security Investigations, and is being prosecuted by Assistant United States Attorney David J. Ignall.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Eric Amaefuna, 65, of King of Prussia, PA, was charged by Indictment with 29 counts of aiding and assisting in the preparation of false income tax returns.

According to the Indictment, the defendant was the owner of American Financial Stewardship (AFS), a tax preparation business on Bustleton Avenue in Northeast Philadelphia. The Indictment alleges that Amaefuna prepared false and fraudulent IRS Personal Income Tax 1040 Forms for client taxpayers for at least tax years 2014 through 2016. The defendant added attachments to the 1040 Forms that were also false, in that they claimed false or inflated employee business expenses, inflated state and local taxes, false or inflated miscellaneous deductions, and losses that were entirely fictitious or falsely inflated. These falsities resulted in the filing of personal income tax returns claiming refunds due to the client­ taxpayers which they were not entitled to receive.

“Our nation’s taxing system relies upon tax preparers to apply our tax laws honestly in order to help clients accurately report income and pay their fair share of federal taxes, not bend or ignore the rules to suit their client’s needs,” said Acting U.S. Attorney Williams.  “As alleged, the defendant manipulated his clients’ tax filings at the expense of honest taxpayers who take seriously their legal obligation to file complete and accurate federal income taxes each year. As we approach this year’s tax filing deadline, this is an important reminder.”

“Filing a tax return is one of the most significant financial transactions an average American taxpayer makes each year,” said IRS Criminal Investigation Special Agent in Charge Thomas Fattorusso. “Taxpayers should be particular in selecting a return preparer and have confidence knowing that person will prepare an accurate tax return. IRS Criminal Investigation wants to make sure taxpayers do not pay good money for bad advice.”

If convicted, the defendant faces a maximum possible sentence of 87 years in prison, and a $7,250,000 fine.

The case was investigated by the Internal Revenue Service, Criminal Investigations, and is being prosecuted by Assistant United States Attorney Terri A. Marinari.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Angela DiPietro-Sabatine, 57, of Pennsauken, NJ, was arrested and charged by Indictment with ten counts of wire fraud, one count of bank fraud, three counts of aggravated identity theft, and aiding and abetting, all stemming from her alleged theft of more than $2.6 million dollars from her former employer, the Delaware River Waterfront Corporation (DRWC). DRWC is non-profit, quasi-governmental entity whose mission is to design, develop, and manage the central Delaware River waterfront from Oregon to Allegheny Avenues for the benefit of Philadelphia residents.

According to the Indictment, when the defendant was employed at DRWC as the Accounting Administrator, her duties included managing the accounts payable and receivable, bank reconciliations, and general ledger work. The Indictment alleges that the defendant used the non-profit’s computerized accounting software, located in its offices in Philadelphia, to create false expense items for legitimate vendors of DRWC – invoicing services that were never rendered. DiPietro-Sabatine then generated DRWC checks for these false expense items, manipulated the computerized accounting software to change the payee on the check from the legitimate vendor to herself, and forged the signatures of DRWC’s authorized signatories, the President and Vice President, on these unauthorized checks made payable to herself. It is alleged that the defendant then spent the stolen proceeds on personal expenses, including gambling and luxury vacations. The Indictment alleges that this scheme occurred over the course of at least seven years, resulting in the theft of more than $2.6 million from DRWC.

“The alleged conduct in this case shows a pattern of deception and dishonesty that went on for the better part of a decade,” said Acting U.S. Attorney Williams. “Organizations must be able to rely on the honesty of employees who handle money, and this is especially important when the entity has a mission meant to benefit the public. As alleged, DiPietro-Sabatine went to great lengths to hide her criminal conduct from her employer; our Office thanks DRWC for coming forward and cooperating fully with the investigation so we can hold this defendant responsible for her actions.”

“The FBI is committed to tracking down those who abuse their positions of trust for personal gain,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division.  “Embezzlement from non-profits like DRWC erodes citizens' faith in their leaders, and bringing those engaging in economic crimes to justice will continue to be one of the FBI’s top criminal investigative priorities.   Today’s indictment sends the message that the FBI will work tirelessly to protect non-profits and other government entities from fraud, waste and abuse.”

If convicted, the defendant faces a maximum possible sentence of 230 years in prison, a six year mandatory minimum sentence, a $4,250,000 fine, and restitution of more than $2.6 million.

The case was investigated by the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorney Katherine E. Driscoll.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Basil Bey, 31, of Philadelphia, PA, was sentenced to 19.5 years in prison, and six years of supervised release by United States District Judge Gerald A. McHugh for conspiring to distribute heroin and crack cocaine, and distributing heroin and crack cocaine, including near a playground.

Bey’s sentence comes after a jury returned guilty verdicts in December 2017 against Bey and three of his co-conspirators, all from Philadelphia, who have already been sentenced for their roles in the conspiracy: Reginald White, 34, was sentenced to 17.5 years, Tyrik Upchurch, 33, was sentenced to 18 years and seven months; and Amin Wadley, 29, was sentenced to 15.5 years. Six other defendants, also all from Philadelphia, previously pleaded guilty and were sentenced by Judge McHugh for their roles in the conspiracy: Sidney Cornish, 31; Dassan Cornish, 29; Jerome Lyles, 36; Rhasul Lucas, 32; Jihad Thorne, 24; and Quaadir Crawford, 32.

As presented at trial, from at least April 2015 through December 2016, Bey was the leader of a narcotics trafficking organization that sold heroin (including fentanyl-laced heroin) and crack cocaine nearly 24 hours a day, seven days a week, to buyers in South Philadelphia. The group, which included White, Upchurch, Wadley, Sidney and Dassan Cornish, Lyles, Lucas, Thorne, and Crawford as members, sold and delivered narcotics in shifts in order to serve customers day and night. Bey, Upchurch, and Wadley also maintained residences around Philadelphia in order to store and package the narcotics for distribution. Due to the dedicated efforts of law enforcement in this case, approximately thirty-five controlled purchases of heroin and/or crack were made from this drug group—all captured on video. Law enforcement also lawfully obtained a wiretap that captured some of the group’s cell phone activity.

“Drug trafficking is an insidious activity that destroys and demoralizes neighborhoods,” said Acting U.S. Attorney Williams. “Basil Bey was an expert at it, a career criminal committed to living a life of crime, and now he will pay the price by spending decades in prison. This is the just punishment that awaits drug dealers facing federal charges.”

“The FBI is committed to keeping communities safe from predators like Basil Bey and the members of his drug trafficking organization,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “Bey’s actions and that of his co-conspirators are particularly heinous given that they trafficked in dangerous narcotics made even more lethal as they were laced with fentanyl. Today’s sentence sends the message to drug organizations and gang members that if you traffick in illegal drugs, we, along with our law enforcement partners, will hunt you down and bring you to justice.”

The case was investigated by the Federal Bureau of Investigation, the Drug Enforcement Administration, and the Philadelphia Police Department. The case is being prosecuted by Assistant United States Attorneys Jason Bologna and Kevin Jayne.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Cushmir McBride, 21, of Yeadon, PA, Kamar Thompson, 34, of Philadelphia, PA, and Nasser McFall, 22, of Claymont, DE, were charged by Indictment for their alleged involvement in four separate incidents in Fall 2020: the robberies of a Target and a Wawa, and attempts to rob two different Wawas, all with multiple explosive devices. McFall is also charged with setting off an explosive device at a bank in Philadelphia later that year. McBride and McFall were previously arrested and charged by Complaint, and Thompson is in federal custody facing charges in a separate case involving the possession of a firearm by a convicted felon. Each defendant is expected to be arraigned on these new charges next week.

On October 26, 2020, a Philadelphia Police Officer-involved shooting occurred in the Cobbs Creek section of Philadelphia that resulted in the death of Walter Wallace, Jr. Peaceful protests began that evening and continued into the following days, accompanied by a period of civil unrest with widespread incidents of looting and violence in various neighborhoods in Philadelphia.

The Indictment announced today alleges that on October 28, 2020, defendants McBride, Thompson and McFall conspired to break into a Target in the Port Richmond section of Philadelphia and set off an explosive device in order to steal money from an ATM inside. The defendants are also alleged to have broken into a Wawa the following day, October 29, on Richmond Street in Philadelphia, where they once again set off explosive devices in order to steal money from the ATM. The Indictment further alleges that the defendants set off explosive devices in two other Wawas, one in Philadelphia and one in Claymont, DE, in two separate attempts to rob these stores in the same manner. Finally, McFall is alleged to have set off an explosive device inside an ATM at a Wells Fargo bank in Philadelphia on December 2, 2020.

Each defendant is charged with conspiracy to maliciously damage property used in interstate commerce by means of an explosive, and aiding and abetting, as well as four separate counts alleging maliciously damaging property used in interstate commerce by means of an explosive.

“The U.S. Attorney’s Office and the Department of Justice will always support the constitutionally protected right to peaceful protest and freedom of speech,” said Acting U.S. Attorney Williams. “However, there is no right to rob, loot or destroy property while endangering lives, as the defendants are accused of doing here. If you engage in violence and commit a federal crime during periods of civil unrest hoping the turbulence will afford you some cover, rest assured that it will not. As this Indictment shows, we will find you, charge you, and you will faces the consequences of your actions in federal court.”

“The Philadelphia Arson and Explosives Task Force maintains a wealth of expertise in these types of investigations,” said Matthew Varisco, Special Agent in Charge of ATF’s Philadelphia Field Division. “These arrests and indictment would not have been possible without the continued professionalism of our partners in the Philadelphia Police Department, the Philadelphia Fire Marshal’s Office and the United States Attorney’s Office. ATF is committed to vigorously working with all of our law enforcement partners and to utilize our expertise in explosives investigations to identify and arrest individuals that commit these types of crimes.”

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.

If convicted, each defendant faces a maximum possible sentence of 80 years in prison.

The case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Philadelphia Police Department, and is being prosecuted by Assistant United States Attorney Robert E. Eckert.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Melissa Madera, 27, of Reading, PA was sentenced to fifteen years in prison, and a lifetime of supervised release by United States District Judge Joseph P. Leeson for multiple child exploitation and sex trafficking offenses.

In September 2020, the defendant pleaded guilty two counts of sex trafficking minors, and one count each of distribution, receipt, and possession of child pornography. The charges stem from Madera’s trafficking of two children, a 15-year-old girl and a 17-year-old girl, from about August until October 2017. Madera forced the girls to engage in commercial sex for her own financial gain, all while plying the minors with drugs like Ecstasy and cocaine to ensure their compliance. Sometimes one of the girls would not make it to school the following day because she had been given so many drugs the previous night.

Madera also obtained a sexually explicit image of one of the girls and used it on a commercial sex trafficking website, advertising the minor for commercial sex acts using locations like the Quality Inn in Wyomissing, PA, and the Days Inn, Kleins’ Motel and Roadway Inn, all in Reading, PA. The defendant would rent two rooms at the hotel: one room was for the commercial sex acts and Madera would stay in the other after meeting the sex buyers and charging a fee of $200 per hour. After the 15-year-old’s mother reported her missing to the Reading Police Department in October 2017, Madera confronted the girl and assaulted her, stating “This is what you get for being a rat.”

“The crimes committed by this defendant will physically and psychologically impact her victims for years to come,” said Acting U.S. Attorney Williams. “Madera advertised these children like objects and plied them with drugs so she’d be more easily able to control them. Her behavior is horrifying, and she deserves every single day of that prison sentence.”

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 U.S. Attorneys’ Offices and the 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.justice.gov/psc.

The case was investigated by the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorney Sherri A. Stephan.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Danial Gomez-Velazquillo, 34, of Norristown, PA, was sentenced to two years and three months in prison, three years of supervised release by United States District Judge R. Barclay Surrick for producing unlawful and counterfeit federal documents, including Social Security Administration and Alien Registration cards.

In March 2020, the defendant pleaded guilty to six counts of unlawful production of identification documents, six counts of sale of Social Security cards (which utilized the social security numbers of five living victims and one deceased victim), and five counts of sale of alien registration cards. According to court documents, Gomez-Velazquillo was a mass producer of high-quality counterfeit documents, including social security cards and alien registration documents, so much so that he earned the nickname, “Photo Guy.” Evidence gathered in the investigation of the case indicated that the defendant produced over 7,000 separate identification documents.

“When we prosecute a fraudster for stealing personal identification information, we recognize that each nine-digit social security number is an American citizen,” said Acting U.S. Williams. “Social security cards and other identification documents have become critical in modern society to confirm individuals’ identities for a wide range of purposes, and those who commit these offenses can cause lifelong harm to the victims.  We will continue to prioritize aggressive prosecution of these cases.”

“Homeland Security Investigations has been at the forefront of investigating fraud schemes,” said Brian A. Michael, Special Agent in Charge for Homeland Security Investigations Philadelphia. “Together with our law enforcement partners we remain steadfast in our pursuit to safeguard the public and hold accountable fraudsters like the defendant, who profit from the production of unlawful and counterfeit federal documents.”

The case was investigated by Homeland Security Investigations and the Social Security Administration- Office of the Inspector General, and is being prosecuted by Special Assistant United States Attorney Megan Curran.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Robert Sean Harrington, 42, of Baltimore, MD, was sentenced to five years and four months in prison, three years of supervised release, and ordered to pay restitution in the amount of $204,066 by United States District Judge Joseph F. Leeson, Jr. for aggravated identity theft and conspiracy to commit wire fraud.

In September 2019, the defendant pleaded guilty to charges of aggravated identity theft, conspiracy and wire fraud. Harrington was one of nine men charged in a Superseding Indictment as part of a coordinated scheme that operated for over two years, between June 2016 and July 2018, with the purpose of committing identity theft in order to defraud various banks and Walmart, Inc., by presenting and cashing over $1,000,000 worth of counterfeit checks at Walmart stores throughout the United States.

All nine defendants in this case pleaded guilty to similar charges; many were previously sentenced and received the following sentences from Judge Leeson: Ahmad Becoate, 34, of Philadelphia, PA, was sentenced to 75 months in prison; Jeffrey Roach, 35, of Baltimore, MD, was sentenced to 94 months in prison; Jethro Richardson, 42, of Greensboro, NC, was sentenced to 70 months in prison; Nathaniel Jones, 41, of  High Point, NC, was sentenced to 24 months in prison; Leander Rowell, 44, also of Greensboro, NC, was sentenced to 87 months in prison; and Brian Cherry, 45, of Charlotte, NC, was sentenced to 70 months in prison. All defendants were also ordered to pay substantial amounts of restitution.

“This was a sophisticated scheme involving many defendants that took excellent investigative work to unravel,” said Acting U.S. Attorney Williams. “Financial fraud and identity theft harm hard-working individuals every day. Our office will continue to aggressively prosecute the perpetrators and seek justice for victims.”

“Passing stolen or counterfeit checks is as old a scheme as the concept of checks themselves,” said Damon Wood, Postal Inspector in Charge of the Philadelphia Division of Postal Inspection Service. “Investigating and prosecuting these cases is tedious but necessary work as it helps to maintain confidence in our economic system. Also, real people are the ones hurt by these schemes as they are forced to work with their banks to recoup their lost money, close compromised accounts and open new clean accounts. Thank you to the United States Attorney, the Secret Service, and the Office of Inspector General from the Social Security Administration for working with us on this case and many other similar cases.”

“This case exemplifies the shared commitment of Federal law enforcement agencies to combat large-scale identity theft that harms businesses and consumers,” said Gail S. Ennis, Inspector General for the Social Security Administration. “I want to thank the U.S. Secret Service and the U.S. Postal Inspection Service, as well as the U.S. Attorney’s Office, for their partnership as we work to maintain the integrity of the Social Security number as a key identifier.”

The case was investigated by the United States Secret Service, the United States Postal Inspection Service, and Social Security Administration Office of Inspector General, and is being prosecuted by Assistant United States Attorney Mary E. Crawley.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that John Adams, 41, Mercedes Hampton-Devero, 28, Malachai Kendall, 20, and Chukuw Ossai, 31, all of Philadelphia, PA, were arrested and charged in two separate Indictments with sex trafficking of minors. Kendall was also charged with both production and distribution of child pornography, and Adams was also charged with tampering with evidence in a federal investigation.

According to publicly filed court documents, Adams, whose self-professed nickname was “Captain Save-A-Hoe,” along with co-defendants Hampton-Devero and Kendall, trafficked two minors during approximately three weeks in January of 2020 from multiple locations in Philadelphia. The defendants allegedly used their cell phones to post advertisements of the victims on a website which is known to be used for advertising sexual services for a fee, directed the minors to participate in commercial sex acts, and took a portion of the proceeds on each occasion. During this time, Kendall also allegedly used his cell phone to record one of the minors performing oral sex on him and then sent the video to the minor victim. Also according to court documents, Adams and Kendall each coerced the minors into having sex with them on multiple occasions, and Hampton-Devero instructed one of the minor victims to record commercial sex acts on her cell phone for Devero to post online to attract more sex buyers. When the minors were rescued and Adams learned he was under investigation by the FBI, he allegedly wiped his cell phone clean of all incriminating evidence.

In a separate Indictment, Ossai is charged with the sex trafficking of a minor in late January 2020. According to public filings, Ossai trafficked one minor, took her to a lingerie store where he picked out lingerie for her, posted an advertisement of her on a website used to advertise sexual services for a fee, and harbored her in a hotel room in Lester, PA.  As charged, Ossai drove the minor victim to a housing project in Philadelphia for her to engage in a commercial sex act, and he attempted to have sex with her himself. The minor was rescued from Ossai’s vehicle after he was pulled over in Tinicum Township.

“The crimes alleged in these Indictments will have a devastating and long-lasting impact on these minor victims,” said Acting U.S. Attorney Williams. “We will continue to work collectively with our law enforcement partners to investigate and prosecute these destructive crimes against vulnerable children.”

If convicted, each defendant faces a maximum possible sentence of life imprisonment.

These cases were investigated by the Federal Bureau of Investigation, with assistance from the Tinicum Township Police Department and the Philadelphia Police Department, and are being prosecuted by Assistant United States Attorney Erica Kivitz.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Combustion Research and Flow Technology, Inc. (“CRAFT”) based in Pipersville, PA, has agreed to pay $192,586 and implement enhanced compliance measures to resolve claims arising from its administration of Small Business Innovation and Research (“SBIR”) contracts funded through the Department of Defense and the National Aeronautics and Space Administration (“NASA”). Concurrent with its settlement with the Department of Justice, CRAFT reached an administrative agreement with the Department of Defense in which CRAFT committed to enhancing its compliance practices relating to SBIR contracts and timekeeping.

Like all federal agencies, the Department of Defense and NASA seek to support American small businesses through the award of research and technology development contracts.  Their SBIR contracts and those of other agencies form “America’s seed fund,” providing critical capital to small businesses across the United States to develop new technologies or products.  These products can be commercialized to provide small businesses with revenue streams to maintain or expand their operations for years to come.

The settlement resolves claims that CRAFT proposed that work would be performed by particular individuals – including in some cases its principal investigator on the research – who then performed little or no documented work on the contract, and that CRAFT neither sought nor received permission to substitute personnel under these contracts. Principal investigators, particularly, are supposed to have frequent contact with research personnel and have the overall responsibility for managing each project’s finances, administration, and scientific and technical direction. The United States does not allege that there was any issue with the quality or functionality of the research or other output that CRAFT produced under these contracts.

"Federally contracted researchers must account accurately for their time so that the United States knows it has received the work for which it bargained. Timekeeping obligations are especially important for the principal investigators and other key personnel upon whose qualifications the contracts were awarded,” said Acting U.S. Attorney Williams. “Whether a contractor is a small business, a major university, or a Fortune 500 company, principal investigators need to ensure that the government knows who is doing the work, and any changes in personnel must be clearly communicated to the United States before being made.” 

“The Defense Criminal Investigative Service (DCIS) is committed to protecting research and development programs funded by the U.S. Department of Defense,” said Patrick J. Hegarty, Special Agent in Charge of the DCIS Northeast Field Office.  “Today's settlement agreement is the result of a joint investigative effort and demonstrates our commitment to work with the USAO-EDPA and our law enforcement partners to ensure that claims submitted on SBIR contracts are proper.”

“SBIR/STTR program participants must accurately represent that they meet and will abide by the program’s compliance requirements,” said Special Agent-in-Charge, Mark. J. Zielinski, Eastern Field Office, NASA Office of Inspector General (“NASA OIG”). “Identifying attempts to circumvent the program requirements is one step in safeguarding access to limited government resources. NASA OIG, along with its law enforcement partners, will continue to aggressively investigate individuals and entities to ensure that American taxpayers get the work for which they contracted.”

Acting United States Attorney Williams also praised CRAFT’s agreement to enhance its compliance program: “We commend CRAFT for reacting promptly to the government’s investigation, cooperating fully, and taking serious steps to ensure this issue never recurs.  We hope the compliance measures it has undertaken will be a model for other grantees and contractors looking to meet their responsibilities to the United States.”

This investigation was conducted as part of the United States Attorney’s Office for the Eastern District of Pennsylvania’s Affirmative Civil Enforcement Strike Force’s grant fraud initiative with investigators from DCIS, NASA-OIG, the U.S. Army Criminal Investigation Command, the Naval Criminal Investigative Service, the Air Force Office of Special Investigations, and the Department of Homeland Security Office of Inspector General. Assistant United States Attorneys Paul W. Kaufman and Veronica J. Finkelstein of the Eastern District of Pennsylvania handled the investigation and settlement. 

The claims resolved by the settlement are allegations only; there has been no determination of liability.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced during a press conference today that Moshe Porat, the former Dean of Temple University’s Richard J. Fox School of Business and Management (“Fox”), has been indicted on charges that he conspired and schemed to deceive the school’s applicants, students, and donors into believing that the school offered top-ranked business degree programs, so they would pay tuition and make donations to Temple.

Porat, 74, of Bala Cynywd, PA, was Dean of Fox Business School from 1996 until 2018.  He also was the Dean of Temple’s School of Sports, Tourism & Hospitality Management from 1998 until 2018.

The Indictment charges Porat with one count of conspiracy to commit wire fraud and one count of wire fraud. According to the Indictment, from at least 2014 until at least 2018, Porat conspired with a Fox professor named Isaac Gottlieb and a Fox employee named Marjorie O’Neill to submit false information about the school’s online MBA (“OMBA”) and part-time MBA (“PMBA”) programs to U.S. News & World Report in order to inflate Fox’s rankings in the annual U.S. News surveys of top OMBA and PMBA programs.

Among other things, the conspirators allegedly agreed to provide false information to  U.S. News about the number of Fox’s OMBA and PMBA students who had taken the Graduate Management Admission Test (“GMAT”); the average work experience of Fox’s PMBA students; and the percentage of Fox students who were enrolled part-time because it was believed that better numbers for these metrics would result in better rankings for the programs.

The Indictment charges that the scheme was successful. Relying on the false information it had received from Fox, U.S. News ranked Fox’s OMBA program Number One in the country four years in a row (2015 – 2018). U.S. News also moved Fox’s PMBA program up its rankings from No. 53 in 2014 to No. 20 in 2015, to No. 16 in 2016, and to No. 7 in 2017.

According to the Indictment, Porat boasted about these rankings in marketing materials directed at potential Fox students and donors. Enrollment in Fox’s OMBA and PMBA programs grew dramatically in a few short years, which led to millions of dollars a year in increased tuition revenues.

Gottlieb and O’Neill have been charged in a separate Information with one count of conspiracy to commit wire fraud. 

“The success of the higher education system in the United States relies not only on the academic excellence and rigor of the programs offered, and not only on the aptitude and hard work of the applicants and students,” said Acting U.S. Attorney Williams, “but also on transparency and honesty about the system itself. Moshe Porat allegedly misrepresented information about Fox’s application and acceptance process, and therefore the student-body itself, in order to defraud the rankings system, potential students, and donors. His conduct, as alleged, undermines the integrity of the entire academic system and forever hurts the students who worked so hard for admission.”

“Moshe Porat knew that burnishing the MBA programs’ rankings would make Fox more competitive, bringing in more students and more dollars,” said Lilian S. Perez, Assistant Special Agent in Charge of the FBI’s Philadelphia Division.“Fudging the school’s data was a means to that end. But countless applicants, students, and donors made big decisions, financial decisions, based on the lies at the heart of this alleged conspiracy. This was an extended and extensive fraud, for which those involved must be held accountable.”

“Today’s action alleges that Mr. Porat knowingly abused his position of trust to defraud the very ones he promised to serve – Temple students. That is unacceptable,” said Terry Harris, Special Agent in Charge of the U.S. Department of Education Office of Inspector General’s Eastern Regional Office. “As the law enforcement arm of the U.S. Department of Education, we will continue to aggressively pursue those who scam students or rig the system for their selfish purposes.”

“Leadership at institutions of higher education owe a duty to provide honest and accurate information about their schools and programs. As these leaders know, students, prospective students, prospective employees, employers, and others rely on the information they disseminate, and trust in its veracity,” said Postal Inspector in Charge Damon Wood. “Unfortunately, we have seen far too many examples of these leaders breaching this duty by engaging in deceptive activity. Today, the United States Attorney charged the former Dean of the Fox School Business at Temple University with providing fraudulent information to college ranking publications and then widely sharing that information with prospective students. This fraudulent data helped propel Temple Business School’s online degree program to a number one ranking in the US News and World Report and caused the program’s application and enrollment numbers to balloon. Many of these students would not have considered Temple if not for the number 1 ranking. The team from the FBI, the US Department of Education Office of Inspector General, and the Postal Inspection Service, spent several years working together to unravel this fraud. Today, thanks to their investigation, we are holding one of those individuals who engaged in this destructive conduct responsible and accountable.” 

If convicted, Porat faces a maximum possible sentence of 25 years in prison, followed by three years of supervised release, and a $500,000 fine. Gottlieb and O’Neill each face a maximum possible sentence of five years in prison, followed by three years supervised release; and a $500,000 fine.

The case was investigated by the FBI, the United States Postal Inspection Service, and the Department of Education’s Office of the Inspector General; and is being prosecuted by Assistant United States Attorney Mark B. Dubnoff.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Abdul West, 38, of Brookhaven, PA, was sentenced to 45 years in prison, ten years of supervised release, and ordered to pay a $5,000 fines by United States District Judge Michael M. Baylson for his role as the leader of the Original Block Hustlaz, or “OBH,”  a violent drug trafficking organization that doubled as a group of aspiring rap artists in Philadelphia. Two of West’s co-defendants, Jamaal Blanding, 39, and Jameel Hickson, 43, both of Philadelphia, PA, were also recently sentenced and received 25 and 20 years in prison, respectively. 

In November 2019, all three defendants, plus an additional defendant who is still awaiting sentencing, Hans Gadson, 36, also of Philadelphia, PA, were convicted, after a two-and-a-half-week trial on charges that included conspiracy to distribute controlled substances, and distribution of or possession with intent to distribute cocaine, crack, and methamphetamine. Several other co-defendants pled guilty prior to trial. In total, nine defendants connected to OBH were charged in a 16-count Second Superseding Indictment in August 2019. All nine were convicted or pled guilty.

Between at least March 2017 through June of 2018, OBH poisoned the Philadelphia community by importing dangerous narcotics, including large quantities of methamphetamine and cocaine, from California to Philadelphia and then selling those drugs in the Philadelphia area. To further their drug business, OBH employed fear, intimidation, and violence. West was the driving force behind the violent character of OBH and routinely posted rap videos and other messages on social media in which he communicated threats of violence, and which demonstrated his power and authority within the organization. According to court documents, West ordered a member of the organization to murder a former member of the group, identified as R.J., because West believed R.J. was involved with West’s “enemy” and “playing both sides of the fence.” R.J. was ultimately shot multiple times and died.

In September 2017, officers and detectives from the Philadelphia Police Department executed a search warrant at 3234 North Sydenham Street, which was a property used by members of OBH to store and sell drugs. During the execution of the search warrant, numerous drugs were seized, including approximately 62 grams of cocaine base (“crack”), 229 grams of heroin, and 48 grams of a methamphetamine mixture. The officers also seized $8,101 from the residence.

In May 2018, FBI agents executed a search warrant on an apartment on Columbus Boulevard, another property used by OBH to store drugs. During the execution of the search warrant, the FBI and seized 10 kilograms of cocaine, nearly 6 pounds of pure methamphetamine, and $20,000 in cash.

In a related case, defendant Charles Salley, 39, of Clayton, Delaware, pleaded guilty to witness tampering in connection with the above-referenced trial. During the trial, a cooperating witness received a threatening letter from Salley under the pen name “Ron Harvey,” threatening physical violence if the witness testified at trial against West and his OBH associates. Salley was present in the courtroom during the course of the trial, including on the day of the witness’ scheduled testimony. The threatening letter was investigated by the FBI and the witness ultimately testified during the trial. Salley is scheduled to be sentenced in August 2021.

“West and his OBH co-defendants pumped huge quantities of deadly drugs into our community,” said Acting U.S. Attorney Williams. “As the evidence presented at trial showed, the defendant’s violent lyrics weren’t just creative expression, they were truthful depictions of the mayhem OBH created on the streets of Philadelphia. Our Office is determined to continue doing everything we can by being ‘All Hands On Deck’ to get violent criminals like OBH off the streets.”

This West/OBH case is part of the FBI’s Violent Gang Safe Streets Task Force, a program through which federal, state, and local law enforcement agencies collaboratively address the violent crime plaguing communities. It was investigated by the Federal Bureau of Investigation, the Drug Enforcement Administration, and the Philadelphia Police Department, and is being prosecuted by Assistant United States Attorneys Everett Witherell and Timothy M. Stengel. The Salley case was investigated by the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorney Justin Ashenfelter.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Michael Kennedy, 49, of Philadelphia, PA, was charged by Indictment with six counts of making materially false statements to the FBI, one count of obstruction of justice, and one count of conspiracy to make a false statement.

According to the Indictment, the defendant participated in the execution of a Philadelphia Police Department search warrant while on duty as a police officer. During the execution of that warrant, Kennedy is alleged to have pocketed evidence, that is, cash proceeds of drug trafficking that was on a nightstand. Subsequently, the Federal Bureau of Investigation (FBI) investigated reports that Kennedy stole this cash. The Indictment alleges that the defendant, when interviewed by FBI agents and Philadelphia Police Department Task Force Officers, made a number of false statements about the incident. The Indictment further alleges that the defendant obstructed justice by corruptly persuading another Philadelphia Police Department officer, and conspiring with that officer, to lie to the FBI about the incident in order to create an alibi and corroborate Kennedy’s false statements.

“The charges against Officer Kennedy allege behavior that is in stark contrast to values police officers are supposed to embody,” said Acting U.S. Attorney Williams. “Our community expects everyone in law enforcement to follow the law, and justice demands it. Thank you to the FBI and the Philadelphia Police Department for their dedicated work on this investigation.”

“As law enforcement officers, we must be held to the highest of ethical standards,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “The public’s trust is critical for our justice system to function properly. That's why the FBI will do everything in its power to hold accountable an officer whose criminal actions undermine that trust.”

If convicted, the defendant faces a maximum possible sentence of 55 years’ imprisonment, including a federal Guidelines Range of a period of incarceration. 

The case was investigated by the Federal Bureau of Investigation, with assistance from the Philadelphia Police Department Task Force Officers, and is being prosecuted by Assistant United States Attorneys Denise S. Wolf and Joseph LaBar.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Miguel Morales, 48, of Quarryville, PA; Jose Morales, 39, also of Quarryville, PA; Oscar Carrillo-Perez, 35, of West Grove, PA; and Santiago Garcia-Ramirez, 44, of Landenberg, PA; were arrested in a take-down operation conducted this morning following their Indictment on charges of conspiring to transport, and transporting, people who are not lawfully present in the United States. Additionally, Morales was charged with making false statements. In a separate Indictment, Miguel Morales and Lawrence Urena, 49, of Spring Lake, North Carolina (who was also arrested) were charged with conspiracy to defraud the United States and failure to collect and pay employment taxes. 

According to the first Indictment, Miguel Morales, who owns and operates Morales Contractor based in Pennsylvania, provided a contracted labor force to various mushroom farms in Chester County, PA. These farms were businesses that were independent from Morales.' The labor force Morales provided was comprised of hundreds of undocumented workers. Morales provided some of these workers with housing in 10 properties that he owns in Lancaster and Chester Counties, and with transportation to and from the farms where they worked – charging those workers for both rent and transportation. The Indictment alleges that, from at least 2018, Miguel Morales, Carrillo-Perez, Garcia-Ramirez, and Jose Morales conspired to transport these undocumented workers who were illegally in the United States. The Indictment also alleges that Miguel Morales hired people regardless of their immigration status, hired undocumented aliens who were not lawfully present in the United States, did not file Form W-2 Wage and Tax Statements, and failed to collect and pay over to the IRS employment taxes for his business.

Defendants Carrillo-Perez, Garcia-Ramirez, and Jose Morales allegedly participated in the conspiracy by driving vehicles registered to Miguel Morales to transport the undocumented workers between their residences and the farms where they worked for Morales Contractor, handing out paychecks to the workers, and driving them to La Latina Intemational Market in Oxford, PA, where they could cash their paychecks and wire money to foreign countries. La Latina also was operated by Miguel Morales.  The remaining counts of the Indictment charge all of the defendants with transporting undocumented people across state lines on various dates.

The second Indictment alleges that Miguel Morales and Lawrence Urena conspired to obstruct the IRS in its lawful assessment and collection of unemployment taxes. According to this Indictment, Urena operated Urena Accounting, which was a tax preparation business that handled accounting work for Morales, including weekly payroll. For calendar year 2020, Morales paid wages of $3,644,142 to employees, many of whom earned $10 per hour, which required him to withhold and pay over to the IRS approximately $921,968 in employment taxes.  However, Morales allegedly paid no employment taxes to the IRS in 2020. Further, the Indictment also alleges that from 2015 to 2018, Morales paid the IRS only a fraction of what he owed, resulting in a tax loss of approximately $2 million.

“According to the Indictment, Miguel Morales and the other defendants knew they were employing undocumented workers as part of a years-long scheme to avoid paying their fair share of taxes to the United States,” said Acting U.S. Attorney Williams. “This case is about exploiting those less fortunate out of sheer greed. This type of fraud will not be tolerated in this District, and these defendants will now have to answer to these charges.”

If convicted, the defendants could face the following possible sentences: Miguel Morales faces a maximum possible sentence of 250 years of in prison, and a $8,750,000 fine; Lawrence Urena faces a maximum possible sentence of five years in prison, and a $250,000 fine; Carrillo-Perez faces a maximum possible sentence of 65 years of in prison, a $1,750,000 fine; Garcia-Ramirez faces a maximum possible sentence of 85 years in prison, and a$2,250,000 fine; and a Jose Morales faces a maximum possible sentence of 15 years of imprisonment, $500,000 and a period of supervised release of 3 years.

The case was investigated by Internal Revenue Service Criminal Investigation, Homeland Security Investigations, Department of Labor Office of Inspector General, and the Chester County Detectives; and is being prosecuted by Assistant United States Attorney Karen Grigsby.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Joseph Whitbeck, 55, of Tamaqua, PA, was charged by Indictment with wire fraud and honest services wire fraud stemming from his operation of a scheme to defraud fellow union members out of rightfully earned overtime compensation.

The Indictment alleges that the defendant, while serving as the Vice President for the Local 274 branch of the National Association of Letter Carriers in the Lehigh Valley area, operated a kickback scheme involving certain letter carriers at the Allentown Post Office. As the Vice President, Whitbeck filed numerous grievances on behalf of groups of letter carriers, claiming that U.S. Postal Service managers violated overtime rules. The indictment charges that Whitbeck then settled these class-action grievances for total lump sums, without designating the specific individuals to whom overtime grievance payments were owed, so that he could select the payees at a later time. Meanwhile, according to the Indictment, Whitbeck offered to secure extra overtime grievance payouts for some letter carriers who agreed to kick back a portion directly to him, generally in cash. This kickback scheme, as charged, prevented non-participating letter carriers from receiving overtime grievance funds to which they were entitled. The Indictment also alleges that the defendant often made false and misleading statements to convince letter carriers to participate in his scheme; for example, the defendant frequently told letter carriers that he would use the kick-backed funds to assist other letter carriers who were out of work.

According to the Indictment, Whitbeck’s covert kickback scheme lasted more than a decade and was uncovered only when a concerned letter carrier raised the issue at a union Executive Board meeting in March 2018.

“Union representatives are supposed to act in the best interest of the union members, not manipulate them into participating in fraud,” said Acting U.S. Attorney Williams. “Here, Whitbeck held a position of trust and owed a fiduciary duty of honesty and loyalty to all letter carriers in the Allentown Post Office in connection with the equitable distribution of overtime grievance settlements. The defendant allegedly abused that trust and violated his obligation to union and non-union letter carriers alike.”

“The vast majority of the Postal Service's 630,000 employees are hard-working, trustworthy individuals who work around the clock to deliver the nation’s mail,” said Kenneth Cleevely, Executive Special Agent in Charge for the Eastern Area Field Office, United States Postal Service, Office of Inspector General. “However, when one of those individuals chooses to violate that trust, and the trust of their fellow employees, special agents with the U.S. Postal Service Office of Inspector General (USPS OIG) will vigorously investigate serious allegations, and seek the individual's prosecution and termination if appropriate. To report crimes committed by Postal Service employees, contact USPS OIG special agents at www.uspsoig.gov or 888-USPS-OIG.”

“An important mission of the U.S. Department of Labor, Office of Inspector General is to investigate allegations of corruption and fraud related to labor unions,” said Jonathan Mellone, Acting Special Agent-in-Charge, Philadelphia Region, U.S. Department of Labor Office of Inspector General. “We will continue to work with our law enforcement partners to investigate these types of allegations”

“Joseph Whitbeck failed in his fiduciary duties and betrayed the trust of the members of Letter Carriers Branch 274 and the union itself by using his union position to enrich himself. The U.S. Department of Labor’s Office of Labor-Management Standards is committed to seeking justice on behalf of the labor unions and their membership when anyone puts personal financial gain ahead of the best interests of their fellow union members. We will continue to work with our investigative partners to ensure that those who are affiliated with labor organizations adhere to the highest standards of conduct,” said OLMS Northeastern Regional Director Andriana Vamvakas.

If convicted, the defendant faces a maximum possible sentence of 400 years imprisonment, a $5,000,000 fine, three years supervised release, and a $2,000 special assessment.

The case was investigated by the U.S. Postal Service – Office of Inspector General, the U.S. Department of Labor – Office of Inspector General, and the U.S. Department of Labor – Office of Labor-Management Standards, and is being prosecuted by Assistant United States Attorney Patrick J. Murray.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Stephen Sharkey, 51, of Swedesboro, NJ, was sentenced to four years and one month in prison, three years of supervised release, and was ordered to pay $296,000 restitution, and to forfeit the same amount of money by United States District Court Judge John R. Padova for wire fraud, aggravated identity theft and money laundering.

In September 2020, the defendant pleaded guilty to two counts of conspiracy to commit wire fraud, eight counts of wire fraud, one count of aggravated identity theft and, one count of money laundering in connection with three brazen and predatory frauds which greatly harmed innocent victims and netted the defendant more than $385,000. Sharkey engaged in two mortgage-closing schemes to defraud potential home buyers – stealing money that the victims had intended to use to purchase residences for themselves and their families. In the third scheme, the defendant stole all of the proceeds of the sale of a house by secretly going to closing without telling the seller.

Sharkey and his associate, Antonio Ambrosio, convinced their victims to provide Sharkey with the down payment funds in advance of the dates set for the real estate closings, with the promise that Sharkey would provide full financing for the purchases. Rather than finance the deals, Sharkey and Ambrosio simply stole the down payment money supplied by the victims and made excuses when the deals did not close. As part of the scam, Sharkey and Ambrosio even defrauded Ambrosio’s own brother-in-law out of $208,000. After receiving this money, Sharkey immediately cut checks to ARMM Investments, LLC, a company owned by George Borgesi. Borgesi and Sharkey were both convicted in United States v. Merlino, et al., 99 CR 363, an early 2000s RICO case in which the Philadelphia La Cosa Nostra was named as the enterprise. Borgesi was named as a capo of the Philadelphia LCN in that Indictment, and Sharkey was identified as a bookmaker for the mob. 

After Sharkey and Ambrosio stole the down payment from Ambrosio’s brother-in-law, they proceeded to lure a second victim to use Sharkey to finance his mortgage, and the victim wired Sharkey $100,000, which Sharkey promptly converted to his own use. The deal for this property fell through, but Sharkey and Ambrosio induced the victim to send the seller an extra $25,000 to hold the deal open, claiming Sharkey would get the deal done. The victim sent the seller the $25,000, but Sharkey had already disposed of the earlier $100,000 and the deal never closed.

Finally, in the real estate fraud perpetrated on the seller victim, Sharkey promised the victim that Sharkey would sell the house belonging to the estate of the victim’s deceased parents and, after going to a closing the victim knew nothing about, Sharkey deposited all of the proceeds of the sale into his own bank account, stealing over $52,000 from the victim in the process.

“Sharkey’s greed impacted the lives and security of multiple families, and his shameful actions had severe consequences for these innocent people,” said Acting U.S. Attorney Williams. “Not only did he and his associate steal mortgage down payments, but he also sold a different family’s house right out from underneath them and pocketed all of the cash. For his actions, he will now spend years in prison.”

“Real estate fraud was just the latest racket for Stephen Sharkey,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “He blatantly preyed on innocent victims here, destroying two families’ plans of buying homes and stealing a third person’s inherited property. A chunk of these fraudulent proceeds was diverted to a longtime Philadelphia mob figure, underscoring Sharkey’s continued association with organized crime. The FBI and our partners are going to keep investigating and locking up those committed to making money through illicit means.”     

“This investigation once again reveals how members and associates of the Philadelphia La Cosa Nostra Organized Crime Family are constantly looking to make illicit financial gains by infiltrating legitimate business or exploiting regulatory rules as well as federal and state laws,” said Brandon Corby, Eastern Organized Crime Task Force Commander, Pennsylvania State Police. “The Pennsylvania State Police with our FBI partners are committed to eradicating this type of criminal behavior and hold those engaged in such activities accountable. “          

The case was investigated by the Federal Bureau of Investigation’s Organized Crime Task Force and the Pennsylvania State Police, and is being prosecuted by Assistant United States Attorney Michael T. Donovan.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced today that Vladimir Penda, 27, of Montenegro, was sentenced to five years and ten months in prison, and two years of supervised release by United States District Court Judge Harvey Bartle III, on charges of conspiracy to possess with intent to distribute 5 kilograms or more of cocaine on a vessel subject to the jurisdiction of the United States. 

For the first half of 2019 until mid-June of that year, Penda, a crew member who worked on board the shipping vessel MSC Gayane as the ship’s fourth engineer, conspired with others to engage in a bulk cocaine smuggling scheme. On multiple occasions during the MSC Gayane’s voyage and while at sea, crew members including Penda helped load bulk packages of cocaine onto the vessel from speedboats that approached the vessel in the middle of the night under cover of darkness. Crew members used the vessel’s crane to hoist cargo nets full of cocaine onto the vessel and then stashed the cocaine in the vessel’s shipping containers. Crew members bent railings on the ship and pulled back doors on the shipping containers so they could fit the huge quantities of cocaine into the containers. After hiding the drugs among legitimate cargo, crew members used fake seals to reseal the shipping containers in which they had stashed the cocaine in order to disguise their clandestine activities and contraband.

On June 17, 2019, federal, state, and local law enforcement agents boarded the MSC Gayane when it arrived at Packer Marine Terminal in Philadelphia and seized about 20 tons of cocaine worth over $1 billion U.S. dollars from its shipping containers in one of the largest drug seizures in U.S. history.

Seven other crew members from the MSC Gayane involved in this smuggling scheme were arrested and pleaded guilty to conspiracy to possess with intent to distribute cocaine based on their participation in the scheme. These crew members include Bosko Markovic, 39, of Montenegro, the ship’s chief officer; Ivan Durasevic, 31, of Montenegro, the second officer; Nenad Ilic, 41, of Montenegro, the engineer cadet; Aleksandar Kavaja, 27, of Montenegro, the electrician; Stefan Bojevic, 29, of Serbia, the assistant reeferman; Fonofaavae Tiasaga, 29, of Samoa, an able seaman; and Laauli Pulu, 34, of Samoa, an ordinary seaman.  

“It has been nearly two years since federal agents conducted one of the largest drug seizures in U.S. history,” said Acting U.S. Attorney Williams. “The follow-up investigation uncovered dark-of-night, clandestine drug trafficking conduct which read like a movie plot, and prosecutors in our Office have been working non-stop since then to pursue justice in this case. With Mr. Penda’s just sentence being handed down today, this chapter of the MSC Gayane saga is now coming to a close.”

“Let today’s sentencing serve as a reminder that 2 years ago this June, Mr. Penda and his coconspirators attempted to smuggle close to 20 tons of cocaine, with an estimated street value of $1 billion dollars through the port of Philadelphia.  This sends a clear message to criminals around the world that our critical infrastructure is not a safe harbor for drug trafficking,” said Brian A. Michael, Special Agent in Charge for Homeland Security Investigations Philadelphia. “Protecting the Homeland against transnational crime is a top priority of Homeland Security Investigations, and together with our federal, state, and local law enforcement partners, we are committed to detecting and disrupting transnational drug smuggling.”

“The many successful prosecutions following CBP’s record-setting cocaine seizure of June 2019 should serve as a reminder to those willing to help drug trafficking organizations that narcotics smuggling has very serious consequences,” said Keith Fleming, Acting Director of Field Operations for CBP’s Baltimore Field Office. “Customs and Border Protection and our law enforcement partners remain steadfast in our commitment to intercept shipments of dangerous drugs before they can be smuggled through our nation’s borders.”

The case is being investigated by Homeland Security Investigations and the United States Customs and Border Protection, together with a multi-agency team of federal, state, and local partners.

PHILADELPHIA and MONTGOMERY – Acting United States Attorneys Jennifer Arbittier Williams and Sandra Stewart jointly announced that Southeast Alabama Community Action Partnership, Inc. (“SEACAP”) has agreed to pay $30,000 and to implement enhanced compliance measures to resolve claims arising from SEACAP’s administration of community service grants funded through AmeriCorps (formerly the Corporation for National and Community Service).

For years, SEACAP has administered multiple grants in AmeriCorps’ Senior Corps program. These grants included the Foster Grandparent Program, which places senior citizens in school and community settings to serve youth with exceptional needs. Like other federal grant recipients, SEACAP is subject to various administrative requirements, including an annual audit by an outside accountant.

The settlement resolves claims that SEACAP improperly retained federal funds even after being told by its outside accountant that it needed to return those funds to the United States.  After SEACAP received a Civil Investigative Demand for information relating to its grant administration, it actively cooperated with the United States’ investigation, including by producing detailed financial and administrative documentation. The United States reached an ability-to-pay agreement with SEACAP to repay what it could without using any other federal funds it has received for its operations, and to significantly enhance its compliance efforts. 

“Every federal grantee, including community service organizations, is required to honestly and openly account for federal funds. This obligation is at the heart of the relationship between the United States and organizations that receive federal grant money,” said Acting U.S. Attorney Williams. “Federal grantees are obliged to return funds to the United States if the funds have not been spent properly or fully drawn down. Strict compliance with grant requirements ensures that federal funds reach those who need them most.”   

“Each day, the Southeast Alabama Community Action Partnership supports impoverished Alabamans, helping families to find food, obtain school supplies, and meet unexpected utility and other costs. The federal government relies on its non-profit partners to help ensure that federal grant funds are being used to assist their communities,” said Acting U.S. Attorney Stewart. “Today’s settlement is a reminder that everyone receiving federal grant funds must adhere to grant compliance conditions and return funds to the government to help others when those conditions require them to do so.”

“SEACAP learned from its accountants that the organization owed money to CNCS (now known as AmeriCorps), but neither returned the money nor informed CNCS of the debt. Wrongfully retaining those funds prevented another organization from using them to meet the needs of its community,” said Deborah J, Jeffrey, Inspector General of AmeriCorps. “We intend SEACAP’s new integrity measures to strengthen the organization and ensure that this never happens again, and we appreciate the work of our partners at the U.S. Attorney’s Offices in the Eastern District of Pennsylvania and Middle District of Alabama for holding SEACAP accountable and ensuring the integrity of this AmeriCorps program.”

Acting United States Attorneys Williams and Stewart also praised SEACAP’s agreement to enhance its compliance program: “We commend Southeast Alabama Community Action Partnership, Inc. for taking the serious steps necessary to make sure this issue never recurs. We hope the compliance measures it has undertaken will be a model for other grantees looking to meet their responsibilities to the United States.”

This investigation was conducted jointly by the United States Attorney’s Offices for the Eastern District of Pennsylvania and Middle District of Alabama with the AmeriCorps Office of Inspector General. Assistant United States Attorneys Paul W. Kaufman and Bryan C. Hughes of the Eastern District of Pennsylvania and Stephen Wadsworth of the Middle District of Alabama handled the investigation and settlement. This case was initiated as a part of the U.S. Attorney’s Office for the Eastern District of Pennsylvania’s Affirmative Civil Enforcement Strike Force focus on grant fraud.

The claims resolved by the settlement are allegations only; there has been no determination of liability.

PHILADELPHIA – During a press conference held on Independence Mall this morning, Acting United States Attorney Jennifer Arbittier Williams was joined by senior officials from more than 15 federal agencies operating in the Philadelphia area to announce their collective effort to combat the raging epidemic of violence in the city and support the work of the Philadelphia Police Department, which was represented at the event by Commissioner Danielle Outlaw. In a letter addressed to the citizens of the Eastern District of Pennsylvania, federal leaders pledged an “All Hands On Deck” effort from their respective agencies to identify, investigate and hold responsible perpetrators of violent crime.

“The violence in Philadelphia affects all of us, not just residents of the city – millions of people travel in and out for work, school, medical care and more. The mission of the federal agencies gathered here today is to keep our entire District safe in partnership with local authorities,” said Acting U.S. Attorney Williams. “That is why we are here today: to announce that together, we are ‘All Hands On Deck’ to stop the violence and support the Philadelphia Police Department in their work. Violent criminals should be on notice that we are re-doubling our efforts and we are coming for you. We have had enough.”

“Our citizens, our children, and even our officers are being victimized as a result of the continued violence in the city. Enough is enough. The PPD and our federal partners recognize the gravity of the challenges that we face. We must continue to work together—citizens, police, and stakeholders - in order to make headway against the scourge of gun violence. We truly are in support of and need ‘All Hands On Deck’,” stated Commissioner Danielle Outlaw.

The text of the letter to the citizens is as follows. The entire letter is available on the USAO-EDPA website.

To the Citizens of the Eastern District of Pennsylvania:

The current violence in Philadelphia affects all of us. Over 1.5 million people live in the City, and millions more travel into the City for work or school, to receive medical care, and to enjoy the City’s parks and cultural attractions. The impact of the ongoing violence is felt in Philadelphia as well as far beyond the City’s limits.

As federal law enforcement, our mission is to keep our entire District safe, and the current state of affairs puts the safety and well-being of everyone in the Eastern District of Pennsylvania at risk. Murders and shootings in Philadelphia continue to rise at an alarming pace. In 2020, 499 people were murdered—a 40% increase from the 356 homicides that occurred in 2019. And in 2021, we are on pace to surpass 600 murders, a horrifying milestone.  Importantly, these numbers do not tell the whole story because they do not include the victims of violence who were lucky enough to survive, nor do they address the harm caused to Philadelphia’s commerce and spirit as people find themselves afraid to venture outside after dark.

These statistics are grim. We cannot allow violent criminals to hold Philadelphia hostage.

That is why we, the undersigned leaders of federal law enforcement agencies, have come together to deliver this message: We are outraged and have had enough. 

Many of the federal agencies below investigate violent crime as part of their mission. But even those that do not have joined this letter to show their commitment to the cause. We are joining together, like never before, to use every tool at our disposal to find and arrest the most dangerous criminals. From obtaining search warrants, to reviewing cell phone records and ballistics evidence, to mobilizing our network of sources, we are sharing information and working every angle—standing shoulder to shoulder with Philadelphia police—to do all that we can to reverse this trend. And when we find those who are committing violence, we will prosecute them and obtain stiff sentences when they are convicted.

We know what the City needs: it needs All Hands On Deck to stop the violence. And that is what we are committed to provide.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Edgar Ivulans, 43, of Latvia, was sentenced today to five years and five months in prison, and was ordered to pay $12,754 in restitution, to forfeit $12,754, and to further pay a $4,000 special assessment by United States District Judge R. Barclay Surrick for operating a fraud scheme utilizing the stolen identities of U.S. citizens. The defendant, a Latvian citizen who was arrested in Germany and successfully extradited to the United States to face the charges in this case, operated the fraud scheme from his home in Latvia.

In June 2020, the defendant pleaded guilty to a 40-count Indictment charging one count of conspiracy to commit mail and wire fraud; 13 counts of wire fraud; 14 counts of mail fraud; one count of conspiracy to commit access device fraud; one count of production, trafficking in, and possession of device-making equipment; one count of production of counterfeit access devices; five counts of money laundering; and four counts of aggravated identity theft.

Ivulans had previously lived in the United States but was deported to his native Latvia after sustaining two fraud convictions in federal court in Illinois. Ivulans’ deportation and residency in Latvia did not stop him from operating the sophisticated fraud scheme in this case. As part of the scheme, Ivulans used stolen identities of U.S. residents to obtain credit cards in their names, which he sent to a co-conspirator based in Philadelphia, who in turn used the fraudulently opened credit cards to buy merchandise that was then sold or returned for cash. The Philadelphia-based co-conspirator would then wire the funds to other co-conspirators in Russia, or first to co-conspirators in Ireland and then to the defendant. Ivulans, while in Latvia, also created additional counterfeit credit cards using the U.S. victims’ credit card information, and sent the Philadelphia-based co-conspirator a magnetic stripe card reader, which was used to create new counterfeit credit cards that the co-conspirator used to purchase pre-paid debit cards and other goods. That merchandise was then shipped to more co-conspirators in Sweden and Ukraine, and directly to the defendant. When Latvian authorities, working in conjunction with the FBI, searched Ivulans’ home in Latvia, over 12,000 credit card numbers were found on his computer, along with at least ten full identity profiles of U.S. residents.

“Identity theft crimes like these have a devastating and long-lasting impact on the victims,” said Acting U.S. Attorney Williams. “Ivulans’ crimes are especially offensive because he committed them after sustaining other fraud convictions resulting in his deportation. Our Office will continue to do everything we can to ensure that such fraud scams are stopped and punished, whether the fraudsters are located here or abroad.”

The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Michael S. Lowe.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Louis Daniel Morales a/k/a “Trouble,” 29, of Reading, PA, was sentenced to 15 years in prison, five years of supervised release, and ordered to pay a $2,000 fine by United States District Judge Edward G. Smith for distributing large quantities of methamphetamine and other controlled substances in the Reading, PA area in 2019. Morales, a self-identified member of the “Nine Trey Gangsters” sect of the Bloods gang and an internet rap artist known as “Trouble” or “King Troub93,” was investigated by the Federal Bureau of Investigation and the Pennsylvania State Police as part of a conspiracy which was responsible for trafficking methamphetamine, heroin, and cocaine in and around Berks County.

In October 2020, the defendant pleaded guilty to three felony counts of manufacture, possession and distribution of a controlled substance, stemming from the sale of more than 800 grams of methamphetamine and an additional quantity of heroin to an undercover Pennsylvania State Police Trooper on three separate occasions between May and June 2019. For approximately three months, the FBI and State Police utilized a federal wiretap to intercept conversations between the defendant, drug suppliers, and customers, revealing that Morales had access to a seemingly endless supply of methamphetamine through several sources. The recorded conversations further detailed that the defendant worked alongside his mother, who trafficked in marijuana, and other individuals with ties to a drug cartel in Mexico. Morales and his codefendants were arrested in September 2019, along with several other defendants charged elsewhere who were also under investigation for similar conduct involving methamphetamine distribution in Reading. 

“Morales and his co-conspirators pumped huge quantities of deadly, addictive drugs into Reading and its surrounding communities,” said Acting U.S. Attorney Williams. “Drug trafficking destroys lives and neighborhoods.  Our Office is determined to protect the communities impacted by drug trafficking by investigating and convicting the criminals responsible for it.”

“Drug traffickers know how much harm their product does to people’s lives and communities. They simply don’t care,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “Putting Louis Morales out of business and behind bars is a win for folks in the Reading area. Bottom line: the FBI and our partners will never cede our cities to drug pushers and gang members.”

The case was investigated by the Federal Bureau of Investigation and the Pennsylvania State Police, and is being prosecuted by Assistant United States Attorney Justin Ashenfelter.

PHILADELPHIA, PA – Deputy United States Attorney Louis D. Lappen announced that Bristol-Myers Squibb (“BMS”) has agreed to pay the United States and participating states a total of $75 Million, plus interest, to resolve allegations that it knowingly underpaid rebates owed under the Medicaid Drug Rebate Program. Of that amount, BMS will pay approximately $41 million, plus interest, to the United States, and the remainder to states participating in the settlement.

Pursuant to the Medicaid Drug Rebate Program (“MDRP”), drug manufacturers are required to pay quarterly rebates to state Medicaid programs in exchange for Medicaid’s coverage of the manufacturers’ drugs. The quarterly rebates are based, in part, on the Average Manufacturer Prices (AMPs) that the manufacturers report to the government for each of their covered drugs. Generally, the higher the reported AMP for a drug, the greater the rebate the manufacturer pays to state Medicaid programs for the drug. This settlement resolves allegations that BMS underreported AMPs for a number of its drugs by improperly reducing the reported AMPs for service fees paid to wholesalers, and by improperly excluding from the reported AMPs additional value it received pursuant to price appreciation provisions in its contracts with wholesalers. As a result, BMS allegedly underpaid quarterly rebates owed to the states and caused the United States to be overcharged for its payments to the states for the Medicaid program.

“The Department of Justice is committed to ensuring that pharmaceutical manufacturers comply with the requirements of programs such as the Medicaid Drug Rebate Program,” said Deputy United States Attorney Lappen. “It is critical that these companies report accurate pricing information used in the rebate calculations so that the government and taxpayers benefit from the program as Congress intended.”

This settlement resolves a lawsuit filed by Ronald J. Streck under the whistleblower provisions of the False Claims Act, which permit private parties, called relators, to file suit on behalf of the United States for false claims and share in a portion of the government’s recovery. The civil lawsuit was filed in the Eastern District of Pennsylvania and is captioned United States ex rel. Streck v. Bristol-Myers Squibb Co., Civil Action No. 2:13-CV-7547 (E.D. Pa.). The government declined intervention of this matter, and the relator and his counsel proceeded with the case. Relator Streck is represented by Dan Miller of Walden Macht & Haran LLP, Joy Clairmont of Berger & Montague, PC, Robert Jackson Martin of Martin Law, PC, and Peter Kohn of Faruqi and Faruqi.

“We thank Mr. Streck and his counsel for their efforts, which were critical to the favorable resolution of this case,” said Deputy U.S. Attorney Lappen. The settlement was a coordinated effort among the Department of Justice Civil Division’s Commercial Litigation Branch, the United States Attorney’s Office for the Eastern District of Pennsylvania, and the National Association of Medicaid Fraud Control Units. For the U.S. Attorney’s Office, the investigation and settlement were handled by Assistant United States Attorney Eric D. Gill and Assistant United States Attorney Charlene Keller Fullmer, Deputy Chief of the Civil Division.

The claims resolved by the settlement are allegations only; there has been no determination of liability.

A Pennsylvania man pleaded guilty today to multiple counts of receiving child pornography, accessing with intent to view child pornography, and possessing child pornography depicting prepubescent minors and minors under the age of 12.

According to court documents, Robert Costello, 53, of Bethlehem, who was employed by the New York City Department of Probation as an assistant commissioner at the time of the offenses in 2020, used an online app to discuss the sexual abuse of children and to receive images of child sexual abuse, and stored images and videos of child sexual abuse on his electronic devices.

Costello is scheduled to be sentenced on July 15, and faces a mandatory minimum of five years in prison and a statutory maximum of 90 years in prison. He also faces mandatory restitution. A federal district court judge will determine the sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Acting Assistant Attorney General Nicholas M. McQuaid of the Justice Department’s Criminal Division; Acting U.S. Attorney Jennifer Arbittier Williams for the Eastern District of Pennsylvania; and Special Agent in Charge Brian A. Michael of Homeland Security Investigations (HSI) in Philadelphia made the announcement.

HSI Philadelphia is investigating the case and received assistance from the Bethlehem Township Police Department.

Trial Attorney Jessica Urban of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorneys Francis Weber and Kelly Harrell of the Eastern District of Pennsylvania are prosecuting the case.

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 U.S. Attorneys’ Offices and 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.justice.gov/psc. 

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Robert Costello, 53, of Bethlehem, PA, entered a plea of guilty before United States District Court Judge Joseph F. Leeson, Jr., to all five counts of child pornography offenses with which he was charged last month.

In February 2021, Costello was charged by Indictment with three counts of receipt of child pornography, one count of access with intent to view child pornography, and one count of possession of child pornography. The defendant admitted to receiving sexually explicit images of children over the Internet and possessing thousands of sexually explicit images and videos of children on several devices that he kept and stored at his residence. During the time that he committed these crimes, Costello was employed as Assistant Commissioner of the New York City Department of Probation.

“Robert Costello possessed and viewed visual depictions of the sexual exploitation of children, images that cause lasting harm to real, innocent victims,” said Acting U.S. Attorney Williams. “As an Assistant Commissioner working for the City of New York, the defendant held a position of trust and leadership – which we now know was woefully misplaced. Our Office will continue to work with our law enforcement partners in all jurisdictions to investigate and prosecute child sexual exploitation offenses.”

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. 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.justice.gov/psc.

The defendant faces a maximum possible sentence of 90 years’ incarceration with mandatory minimum sentence of five years’ imprisonment, five years up to a lifetime of supervised release, and up to a $1,250,000 fine.

The case was investigated by the Department of Homeland Security Investigations and Bethlehem Township Police Department, and is being prosecuted by Assistant United States Attorneys Francis A. Weber and Kelly Harrell, and Department of Justice Trial Attorney Jessica Urban of the Child Exploitation and Obscenity Section (CEOS).

PHILADELPHIA – Deputy United States Attorney Louis D. Lappen announced that Dkyle Bridges, 35, of Claymont, DE, was sentenced to 35 years in prison, ten years of supervised release, and was ordered to pay $53,000 in restitution to his victims and a special assessment of $30,000 under the Justice for Victims of Trafficking Act by United States District Court Judge Nitza I. Alejandro-Quiñones for running a multi-state sex trafficking operation that brutally victimized vulnerable young women and girls for many years.

In April 2019, following a two-week jury trial, the defendant was found guilty of all charges, specifically: one count of conspiracy to engage in sex trafficking by force, fraud and coercion and in sex trafficking of minors; two counts of sex trafficking of adults by force, fraud, and coercion; and three counts of sex trafficking of minors by force, fraud, and coercion.

The evidence presented at trial showed that for more than five years, Bridges led a sex trafficking operation for his financial gain in which he coerced young women and girls to engage in commercial sex acts in southeastern Pennsylvania, Delaware, and elsewhere. Bridges preyed on vulnerable teenage girls and young women, many of whom were homeless, who needed financial and emotional support in their lives. Bridges lured them into his trafficking circle with false promises of that kind of support and then subjected them to violence – as well as fear of violence -- by making them watch him assault other trafficking victims. Among the tactics Bridges used to abuse and control his victims, as described at trial, included pouring water over them to keep them awake, choking them, and otherwise physically assaulting them. On at least one occasion, he tased his victim in the chest.

In furtherance of the sex trafficking enterprise, Bridges advertised his victims for sex acts using Backpage.com – a website that the Federal Bureau of Investigation has since shut down for its role in advertising and promoting sex trafficking.

Codefendants Kristian and Anthony Jones, among others, assisted Bridges in various capacities in running the sex trafficking operation, including by recruiting and transporting victims, collecting money, and paying for hotel rooms. The codefendants were also convicted at trial and are scheduled to be sentenced later this year. 

“Bridges’ crimes were devastating to his victims, who were already facing tremendous challenges in their lives, such as homelessness and a history of abuse,” said Deputy U.S. Attorney Lappen. “Today’s sentence of thirty-five years incarceration reflects the seriousness of his crimes and the irrevocable damage he caused, all in pursuit of financial gain. We will continue to work collectively to investigate and prosecute these destructive crimes committed against some of the most vulnerable members of our community.”

“Dkyle Bridges advertised underage girls and women for sex, profiting from their exploitation,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “These victims were controlled by the constant use or threat of violence, battered both physically and emotionally. Today’s sentence keeps Bridges exactly where he belongs — behind bars, being held to account for his repulsive actions. Know that the FBI and our law enforcement partners are working every day to shut down sex traffickers like this and deliver justice for their victims.”

The case was investigated by Federal Bureau of Investigation with assistance from Tinicum Township Police Department; Newark, Delaware Police Department; Delaware State Police; Delaware River Bay Authority; and Philadelphia Police Department and was prosecuted by Department of Justice Trial Attorney Jessica Urban and Assistant United States Attorney Priya  T. De Souza. 

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Gregory Stevens, 27, of Philadelphia, PA, was arrested today and charged by Indictment with Hobbs Act robbery and using a firearm during a crime of violence. 

The Indictment alleges that on February 22, 2021, the defendant committed armed robbery of Universal Pharmacy on Kensington Avenue in Philadelphia, stealing oxycodone and other drugs. According to court documents, when Stevens demanded the oxycodone, the pharmacist told Stevens it was in the back room of the pharmacy and led him there to get it. A struggle ensued when the pharmacist attempted to resist Stevens, and the defendant shot the pharmacist in the chest with the 9mm semi-automatic pistol he was carrying. Stevens allegedly committed this crime wearing a Pennsylvania Parole Board GPS-enabled ankle monitor.

The defendant also has pending charges in state court for distribution of heroin in December 2020, and for aggravated assault stemming from a March 9, 2021 road-rage incident near the intersection of Broad Street and Washington Avenue in Philadelphia, during which he violently attacked another motorist after a traffic accident, going so far as to throw cinder blocks through the other motorist’s car windows at the driver and teenage passenger.

“As alleged in the Indictment, Gregory Stevens is a grave danger to the community and is now facing federal charges and a lengthy prison sentence if convicted,” said Acting U.S. Attorney Williams. “If you commit a serious violent offense in the City of Philadelphia, we and our law enforcement partners will do all we can collectively to arrest and prosecute you to the fullest extent of the law.”

“Gregory Stevens allegedly carried out a daylight armed robbery that ended with an innocent man shot in the chest,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “The FBI/Philadelphia Police Violent Crimes Task Force is working every day to identify and arrest those brazen enough to commit such vicious acts. For the safety of this city and everyone in it, it’s imperative we get violent criminals off the street.”

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone.   The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.

If convicted, the defendant faces a mandatory minimum sentence of 10 years and a maximum possible sentence of life imprisonment.

The case was investigated by Federal Bureau of Investigation and the Philadelphia Police Department, and is being prosecuted by Assistant United States Attorney Justin Oshana.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Mario Ramirez, 33, of Philadelphia, PA, was sentenced to  14 years in prison, and three years of supervised release by United States District Judge Gene E.K. Pratter for trafficking weapons, conspiracy, and being a felon in possession of firearms as part of his family’s firearms trafficking ‘business’ in Philadelphia. The defendant committed these crimes while under the supervision of the Commonwealth of Pennsylvania for a prior gun offense. 

In March 2020, the defendant pleaded guilty to all charged offenses in two separate Indictments. First, in January 2019, the defendant was charged with being a felon in possession of firearms stemming from the recovery of four of the defendant’s firearms which he had stored in his mother’s home in Philadelphia. Then in October 2019, the defendant was charged with conspiracy to deal in firearms without a license, dealing in firearms without a license, and being a felon in possession of firearms, all stemming from a law enforcement operation conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) in the fall of 2018. During the operation, ATF purchased 35 firearms, including machinegun conversion kits and 11 self-made, non-serialized firearms, in eight transactions from the defendant, who conspired with co-defendant Matthew “Montana” Stephens who had brokered the sales and received a percentage of each sale as a fee.

On March 4, 2021, the defendant’s sister, Elena Ramirez, was sentenced to three years in prison for trafficking firearms and ammunition – sales which were also brokered with the assistance of Stephens.

“Mario Ramirez added to the chaos and carnage on the streets of our city by illegally selling firearms,” said Acting U.S. Attorney Williams. “When he was arrested on these charges, his sister stepped in to fill the gap – and now they will both face the consequences of their actions in federal prison.”

“Firearms trafficking continues to help fuel violent gun crime throughout the Commonwealth of Pennsylvania,” said Matthew Varisco, Special Agent in charge of ATF’s Philadelphia Field Division. “Illegally selling firearms presents an obvious threat toward the safety of our communities.  Had it not been for the collaborative work between investigators and the United States Attorney’s Office, dozens of firearms would have been on the streets of Philadelphia where they would have been used in an untold number of violent crimes.”

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone.   The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.

The case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Philadelphia Police Department, and is being prosecuted by Assistant United States Attorney Priya T. De Souza.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Brandon Garcia, 22, of Jersey City, NJ, was sentenced to 14 years and nine months (or 177 months) in prison, and 4 years of supervised release by United States District Court Judge Jeffrey L. Schmehl for the armed robbery of a Speedway gas station and convenience store in Allentown, PA on March 28, 2017.

In June 2019, the defendant pleaded guilty to multiple felonies arising from the 2017 robbery, including Hobbs Act robbery, and using, carrying or possessing a machine gun during a crime of violence.  During the robbery, the defendant used a long gun to threaten store employees while robbing the store. Garcia poked one employee with the gun as he ordered him to “Get down!” and demanded employees provide him with cash and Newport cigarettes, which they did.

Meanwhile, a good Samaritan, who was coming to the Speedway to fill his car with gas, noticed the defendant wearing all black and running into the store with his hood up; he suspected something was amiss. His suspicions were confirmed when he saw Garcia display his gun in the store. He immediately called 9-1-1 to report the robbery. When he saw Garcia run out of the store, the witness told the dispatch operator that he would follow the defendant. The witness watched the robber get into a waiting silver vehicle parked in an alley and followed the car. As he did, he described where the car was driving to the 9-1-1 operator until law enforcement located both vehicles. When officers stopped the silver car, they found two men inside, Garcia and his co-defendant Daequon Benjamin, who was driving. The good Samaritan confirmed that the silver vehicle was the car he had followed from the Speedway, and officers found the black clothing, a sawed-off short-barreled rifle, cash and Newport cigarettes before arresting the defendants.

In pleading guilty to the charges associated with this incident, Brandon Garcia also admitted committing two additional, similar armed robberies in Allentown, PA (of a 7-11 convenience store and a Sunoco gas station and convenience store) a mere five days before the Speedway robbery. During both of these earlier incidents, the defendant brandished the same sawed-off short-barreled rifle he brandished during the Speedway robbery.

“Brandon Garcia robbed three businesses within a one week, all at gunpoint, terrorizing the employees and patrons of those stores and the surrounding community,” said Acting U.S. Attorney Williams. “His crime spree endangered many lives and demonstrated his complete disregard for other people and for the law. Thanks to the dedicated efforts of the investigators on this case and the brave actions of a concerned citizen, this defendant has been brought to justice.”

The case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Allentown Police Department, and is being prosecuted by Assistant United States Attorney Sarah Damiani.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Caesar DiCrecchio, 60, of Voorhees, NJ, was charged by Information with two counts of wire fraud, one count of conspiracy to commit wire fraud, one count of money laundering conspiracy, one count of aggravated identity theft, and four counts of tax evasion, all of which allegedly caused more than $7.8 million in losses to the Philadelphia Wholesale Produce Market in South Philadelphia. Separately, Thomas Del Borrello, 42 of Sewell, NJ, was also charged by Information with eight counts of aggravated false filing of a currency transaction report and one count of aggravated failure to file a currency transaction report.

The Information alleges that DiCrecchio, the former President and CEO of the Produce Market, exercised control over every aspect of the Market, including expenditure of funds, and was required to report on the Market’s finances to its Board of Directors. The defendant defrauded the Market by using company funds to pay $1.9 million in rent on his Stone Harbor, New Jersey shore house; converting into cash $1.1 million in checks drawn on the Market’s bank account and using the cash for his own benefit; causing $1.7 million in checks to be issued from the Market operating account payable to his friends or relatives; causing the Market to pay for the defendant’s personal credit card expenditures; converting $320,000 in checks that were payable to the Market and cashing them for his own benefit; skimming $2.6 million in cash from the pay gate at the Market’s parking lot, which he used to pay Market employees ‘under the table’ while keeping a substantial portion for his own use; and using Market funds to provide a $180,000 loan to a Market vendor, which the vendor repaid directly to DiCrecchio. The defendant concealed these expenditures in the Market’s books and records by directing that these payments be reflected as legitimate business expenditures, for example: notated as maintenance, snow removal, insurance, legal fees and other false expenditure entries.

The Information also alleges that DiCrecchio committed aggravated identity theft by cashing checks at a currency exchange using the name of an unwitting victim as the payee. Further, it is also alleged that the defendant conspired to engage in money laundering by agreeing with two unnamed individuals to conduct repeated money laundering transactions by converting Market funds into money orders at a currency exchange so that he could pay the rent at his shore house. In total, DiCrecchio laundered approximately $319,736 by purchasing money orders at the currency exchange using Market funds.

According to the second Information, Del Borrello was a supervisor at United Check Cashing on South Broad Street in Philadelphia and was responsible for compliance with regulations governing cash transactions, including the preparation and filing of Currency Transaction Reports (CTRs). DiCrecchio regularly caused groups of checks to be delivered to, and cashed at, United Check Cashing. These checks were each made out for less than $10,000, but when cashed as a group generated in excess of $10,000 in United States currency. For these cash transactions in excess of $10,000, regulations require the currency exchange to file a CTR, recording the identity of the person who presented the transaction. Del Borrello allegedly caused the filing of false CTRs which hid DiCrecchio’s identity, or caused United Check Cashing to fail to file a CTR altogether. On some occasions, DiCrecchio directed Del Borrello, or others at United Check Cashing, to convert the proceeds of the checks into separate money orders which were used to pay the monthly rent for DiCrecchio’s Stone Harbor house.

Lastly, the Information alleges that DiCrecchio willfully attempted to evade federal income tax over several years, by failing to report more than $2.1 million in income for tax years 2014 through 2017. DiCrecchio failed to report as income the proceeds of his fraud on the Market, as well as a car allowance, a pension allowance, and consulting income that he received from the Market. 

“Complexity will not hide crime from law enforcement,” said Acting U.S. Attorney Williams. “Further, and as alleged here, ‘nickel and dime’ theft – skimming small amounts here and there over many years – is just as illegal as stealing one large lump sum. The charges announced today reflect our Office’s commitment to uncovering and prosecuting complicated financial frauds.”

“Caesar DiCrecchio stands charged with a massive theft from the Philadelphia Wholesale Produce Market,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “Stealing business funds for personal use is fraud, plain and simple, and anyone padding their paycheck like this can expect a whole lot of attention from the FBI.”  

“Willfully evading one’s tax liability is a violation of federal tax law,” said IRS Criminal Investigation Special Agent in Charge Thomas Fattorusso. “Mr. DiCrecchio stands accused of evading taxes on millions of dollars’ worth of income, while Mr. Del Borrello is alleged to have, among other things, caused the filing of false CTRs which hid Mr. DiCrecchio’s identity and permitted his fraud to continue. Rest assured that IRS Special Agents are fully trained to investigate numerous types of tax and related financial crimes, and are constantly working to uncover crimes such as those charged in these cases.”

“This investigation is a perfect example of a collaborative effort between state and federal agencies,” said Sgt. Brandon Corby, Commander, Eastern Organized Crime Task Force, Pennsylvania State Police. “DiCrecchio and Del Borrello utilized their positions to further their personal wealth and defraud the Wholesale Produce Market of millions of dollars. The Pennsylvania State Police along with our federal partners are committed to eradicating this type of criminal behavior and hold those engaged in such activities accountable for their actions.”          

DiCrecchio faces a maximum sentence of 102 years in prison, a three-year period of supervised release, and a fine of $2,500,000. Del Borrello faces a maximum sentence of 90 years in prison, a three-year period of supervised release, and a fine of $4,500,000.

The case was investigated by the Federal Bureau of Investigation’s Organized Crime Task Force, the Internal Revenue Service – Criminal Investigation, and the Pennsylvania State Police, and is being prosecuted by Assistant United States Attorney Michael T. Donovan.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Sean Christopher Williams, 40, of Sandy Springs, GA, was sentenced to three years in prison, five years of supervised release, and ordered to pay $185,920 in restitution by United States District Court Judge John R. Padova for a nationwide bank fraud and identity theft scheme.

In February 2020, the defendant pleaded guilty to one count of bank fraud and attempt, and one count of aggravated identity theft. Williams used stolen identities to open fraudulent accounts at multiple banks, but he left the accounts unfunded. Williams then repeatedly transferred “funds” from one fraudulent account to another, knowing that the transferring account did not have any funds to support the transfer. Williams quickly used the receiving account to pay a variety of financial accounts in his name, including credit cards and student loans, before the receiving bank determined no funds were incoming. This scheme resulted in more than $185,000 in losses to the banks and impacted around 35 individual victims whose names and social security numbers were attached to the fraudulent accounts.

“This was a sophisticated fraud scheme with many victims from across the country, and it took top-notch investigative work to unravel,” said Acting U.S. Attorney Williams. “Financial fraud and identity theft is often financially devastating for victims.  Prosecuting these cases will continue to be a top priority of the United States Attorney’s Office.”

“Sean Williams not only defrauded multiple banks, he dragged dozens of innocent people into his scheme by stealing their identities,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “The impacts of identity theft can be serious and far-reaching for victims. Whether you take money that’s not yours or someone else’s personal information, the FBI is going to ensure you’re held accountable.”

The case was investigated by the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorney Michael J. Rinaldi.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that  Dmitry Royzman, will pay $128,000 to resolve False Claims Act allegations that he illegally claimed subsidies from the U.S. Department of Housing and Urban Development (“HUD”) while renting an apartment to his mother-in-law in violation of the program’s requirements.   

The settlement resolves allegations that, between December 2008 and August 2020, Royzman rented a subsidized apartment to his mother-in-law in violation of the Housing Choice Voucher Program’s (“HCVP”) requirements. The HCVP is commonly known as Section 8 housing. In the settlement agreement, the United States alleges that Royzman participated as a landlord in the HCVP, a program whereby HUD provides rental subsidies for eligible low-income tenants who locate acceptable rental units on the private market. The government alleges that Royzman submitted documents to the Bucks County Housing Authority (which administers the HCVP in Bucks County) falsely certifying that the assisted tenant in Royzman’s rental property was not an immediate relative of the property’s owners. In fact, the sole tenant was Royzman’s mother-in-law, which precluded Royzman’s receipt of HCVP rental subsidies.

“HUD instituted the HCVP program to help low-income residents without other options obtain decent housing,” said Acting U.S. Attorney Williams. “Landlords who agree to participate in this program cannot manipulate it to give subsidized housing to their relatives. By investigating this case, we have put all landlords participating in the Section 8 program on notice that they cannot put relatives in apartments for which they are receiving HCVP funds.” 

Williams added, “From the time that this matter was brought to his attention, Mr. Royzman committed himself to setting things right. We appreciate his cooperative approach and efforts toward rectifying the problem.” 

“The U.S. Department of Housing and Urban Development, Office of Inspector General is committed to working with the Department of Justice and community stakeholders to ensure that Federal funds intended to help low-income families are not wasted or misapplied,” said Acting Special Agent in Charge Shawn Rice.  “Today’s settlement underscores the government’s commitment to protecting the integrity of HUD programs against fraud, waste, or abuse.”

This case was investigated by the U.S. Department of Housing and Urban Development, Office of Inspector General, and by the Bucks County Housing Authority. For the United States Attorney’s Office, Assistant United States Attorney Colin Cherico handled the investigation and settlement.

The claims resolved by the settlement are allegations only; there has been no determination of liability.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Michael Fields, 34, and Desiree Adorno, 65, both of Philadelphia, PA, were arrested and charged by Indictment for their alleged attempt to rob a Wawa in Philadelphia with multiple explosive devices. Fields made his initial appearance in federal court today, and Adorno is scheduled to make her initial appearance in federal court on Monday.

Following peaceful protests in Philadelphia in the early afternoon of May 30, 2020 in response to the killing of George Floyd in Minneapolis, MN, civil unrest began to unfold later that afternoon and into the following day that resulted in widespread looting, burglary, arson, destruction of property, and other violent acts. The Indictment alleges that in early June 2020, Fields and Adorno conspired with other individuals to break into a Wawa store on Richmond Street in Philadelphia. In addition to stealing merchandise from the store, the Indictment alleges that the defendants had explosive devices in their possession, one of which was placed inside a lottery machine inside the Wawa, and two of which were placed near a safe and a cash register in the middle of the store. Police arrived at the store before any devices were detonated. Both Fields and Adorno are charged with conspiracy and attempting to maliciously damage property used in interstate commerce by means of an explosive, and aiding and abetting. Fields was also charged with possession of an unregistered firearm.

“The U.S. Attorney’s Office and the entire Department of Justice will always support peaceful protest – we are sworn to protect the rights guaranteed by the First Amendment,” said Acting U.S. Attorney Williams. “But that does not cover destructive rioting, looting, committing arson and other violent acts. Here, the defendants allegedly attempted to detonate explosive devices while robbing a store, potentially endangering many lives including those of police officers who responded to the scene. This conduct is not free speech and is not protected by our constitution; rather, it is criminal.”

“As alleged, these defendants were in possession of several explosive devices and appeared intent to use them,” said Matthew Varisco, Special Agent in charge of ATF’s Philadelphia Field Division.  “This type of behavior places our entire community in danger.  I commend the outstanding work of the Philadelphia Police Department who acted swiftly and were able to arrest these individuals before further harm could be done.  ATF, along with our local, state and federal partners remain dedicated to protecting our community from violent acts of all kinds.”

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.

If convicted, defendant Fields faces a maximum possible sentence of  90 years in prison, and defendant Adorno faces a maximum possible sentence of  80 years in prison.

The case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Philadelphia Police Department, and is being prosecuted by Assistant United States Attorney Roberta Benjamin.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Anthony Francis Nero, 48, of Eagleville, PA, was arrested by federal authorities and charged by Criminal Complaint on Wednesday, March 3, 2021, on charges of sending threatening communications and cyberstalking. The defendant made his initial appearance in federal court today and was detained until his next hearing on Tuesday, March 9, 2021.

According to court documents, on January 7, 2021 the Montgomery County Democratic Party (MCDP) allegedly received a communication threatening “random acts of violence” against the MCDP office. Then on January 20, 2021 MCDP officials discovered that the front window of their office space in Norristown, PA, had been shot through three times, striking a wooden desk inside. Investigators inspected two spent rounds found within the MCDP’s office space and determined that they appeared to have been fired from a .45 caliber handgun. Investigators traced the January 7th threatening communication as originating from the defendant’s cell phone.  In addition, investigators located a 2011 record of sale of a .45 caliber handgun to the defendant.  

“As alleged in the Complaint, the defendant sent a threatening communication and then acted upon those threats – endangering the lives of anyone who might have been in the vicinity,” said Acting U.S. Attorney Williams. “I want to thank our partners in the Montgomery County District Attorney’s Office and all agencies at the federal, state and local levels for their dedicated work investigating this case.”

“Law enforcement at the federal, state and local level take terroristic threats very seriously, and we are partnering together to make sure all communities are safe from this kind of threat and criminal behavior,” said Montgomery County District Attorney Kevin Steele.

If convicted, the defendant faces a maximum possible sentence of 15 years in prison and a $500,000 fine.

The case was investigated by the Federal Bureau of Investigation, Pennsylvania State Police, Montgomery County District Attorney’s Office Detectives, and Norristown Police Department, and is being prosecuted by Assistant United States Attorneys Vineet Gauri and Josh A. Davison.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Elena Ramirez, 34, of Philadelphia, PA, was sentenced to three years in prison and three years of supervised release by United States District Court Judge Gene E.K. Pratter, for trafficking weapons and ammunition as part of her family’s firearms trafficking ‘business’ in Philadelphia.

In November 2020, the defendant pleaded guilty to conspiracy to deal in firearms without a license, dealing in firearms without a license, and possession of a machinegun and a non-registered machinegun, arising from a series of purchases made during the course of an undercover law enforcement operation. In January 2019, the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) purchased a total of 19 machinegun conversion devices, two privately made firearms (“PMFs”), two rifles, and more than one hundred rounds of ammunition over four separate transactions from Ramirez. The defendant provided the inventory for these transactions and received the net-profits from the sales, which were brokered through a co-defendant, Matthew “Montana” Stephens, who received a percentage of each sale as a fee.

In 2019, the defendant’s brother, Mario Ramirez, was indicted for selling firearms, ammunition and machinegun conversion devices, also with the help of Stephens, and is awaiting sentencing. Thus, despite having personal knowledge of the legal consequences of engaging in firearms trafficking, Elena Ramirez stepped into her brother’s role and continued to supply weapons for sale.

“Elena Ramirez threatened the safety of our communities by illegally selling firearms on the street,” said Acting U.S. Attorney Williams. “Even after witnessing her brother’s arrest and conviction for the exact same crimes, this defendant chose to follow in his footsteps and will now spend years in prison. Thanks to the steady, determined efforts of investigators at the ATF, the Ramirez family business is closed.”

“Federal law requires gun dealers to obtain a license and to conduct background checks on their customers,” said Matthew Varisco, Special Agent in charge of ATF’s Philadelphia Field Division. “These laws are in place to prevent guns from falling into the hands of dangerous people. When a person circumvents the license-and-background-check framework by engaging in the business of unlicensed dealing, that person increases the threat to public safety. ATF, along with our local, state and federal partners, are committed to countering that public safety threat as a part of its broader strategy to combat violent crime.”

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone.   The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.

The case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives, and is being prosecuted by Assistant United States Attorney Priya T. De Souza.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Michael Hughes, 32, of Philadelphia, PA, was sentenced to 30 years in prison, five years of supervised release and ordered to pay restitution to his victims by United States District Court Judge Cynthia M. Rufe, for two armed robberies in which two victims were shot in the leg in August 2016. 

In January 2020, a jury convicted Hughes of all charges against him: two counts of robbery which interferes with interstate commerce (known as Hobbs Act robbery), and two counts of using, carrying, bradishing, and discharging a firearm during and in relation to a crime of violence. The charges stem from Hughes’s participation in an armed robbery and shooting, along with co-defendant Nashadeem Henderson, of a marijuana dealer in the area of 2600 Allegheny Avenue in Philadelphia; and an armed robbery and shooting of a pizza deliveryman employed by Mimmo’s Pizza in the area of 3000 North Taney Street in Philadelphia. Henderson pleaded guilty prior to the trial and was sentenced to 18 years in prison for his role in the crimes.

“Michael Hughes acted with complete disregard for the lives of his victims, shooting indiscriminately in an effort to score some quick cash,” said Acting U.S. Attorney Williams. “Philadelphia is in the midst of a public safety crisis, with alarming rates of homicides and shootings. Our Office is doing everything it can to investigate and aggressively prosecute violent crimes like those committed by this defendant.”

“Michael Hughes took part in two violent armed robberies in one week, which saw two victims shot and seriously wounded,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “Anyone who thinks they can make their money this way, anyone who thinks they can carry out this kind of crime with impunity, should take a good hard look at the 30-year sentence just handed down to Mr. Hughes. The FBI and our partners are committed to combating the violence scarring so many lives in Philadelphia.”   

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone.   The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.

The case was investigated by the Federal Bureau of Investigation and the Philadelphia Police Department, and is being prosecuted by Assistant United States Attorneys Amanda R. Reinitz and Roberta Benjamin.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Quintel Martins, 27, of Drexel Hill, PA; DeAndre Jackson, 23, of Newark, DE; and Christopher Winfield, 22, of Wilmington, DE; were charged by Indictment with multiple counts of robbery and firearms offenses in connection with two separate robberies of Wawa convenience stores in Delaware County in 2019. Martins and Winfield were also charged by a criminal complaint in January 2021 and taken into federal custody at that time; Jackson was arrested yesterday and will make his initial appearance in federal court this week.

In the Indictment, Martins, Jackson and Winfield are each charged with one count of conspiracy to interfere with interstate commerce by robbery, two counts of interference with interstate commerce by robbery (commonly known as “Hobbs Act robbery”), and two counts of using, carrying, and brandishing a firearm during and in relation to a crime of violence.

The Indictment alleges that on June 17, 2019, the defendants committed an armed robbery of a Wawa in Wayne, PA, and that on September 14, 2019, the three also committed an armed robbery of a Wawa in Drexel Hill, PA. During these two robberies, the defendants are charged with stealing a total of more than $7,800 and other items. Then, in the early morning of October 2, 2019, law enforcement stopped a car traveling in Collingdale, PA, in which Martins, Jackson, and Winfield were all passengers, allegedly containing items like those used in the robberies, including masks, firearms and gloves.

“The conduct alleged in the Indictment displays an appalling disregard for the safety of others,” said Acting U.S. Attorney Williams. “The employees of these stores were just going about their daily business when they were allegedly terrorized at gunpoint.  No one should have to go through that.  This Indictment is an example of how our Office is working to keep Philadelphia and its neighboring communities safe.”

If convicted, each defendant faces a maximum possible sentence of lifetime imprisonment.

The case was investigated by Collingdale Police Department, Philadelphia Police Department, Radnor Police Department, Upper Darby Police Department, and the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorney Kevin Jayne.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that John Dougherty, 60, and Gregory Fiocca, 28, both of Philadelphia, PA, were charged by Indictment with 18 counts of extortion and one count of conspiracy to commit extortion. This Indictment represents new charges against Dougherty, separate and distinct from any other currently pending case.

The Indictment alleges that Dougherty, the Business Manager of International Brotherhood of Electrical Workers Local 98 (“Local 98”), and Fiocca, his nephew and a member of Local 98, conspired to extort salary, wages, and employee benefits from Fiocca’s employer, an electrical contracting company, for services Fiocca allegedly did not actually perform from August 2020 until January 2021. The object of the conspiracy was to have Fiocca’s employer continue to pay Fiocca without holding Fiocca accountable or monitoring his work performance. The defendants allegedly used actual and threatened force, violence and fear, including fear of economic harm, to obtain this result.

The Indictment further alleges that between October 2019 and August 2020, after Dougherty appointed Fiocca to be the Local 98 steward for employees working at this job site, Fiocca frequently did not show up for work, was not present at his workstation, and did not complete his assigned work. As a result, Fiocca allegedly was sometimes paid for fewer than 40 hours per week.  It is also alleged that Dougherty was apprised of Fiocca’s attendance and performance issues but refused to acknowledge that Fiocca was at fault.

On August 19, 2020, after Fiocca had been paid for fewer than 40 hours for the previous week because he had worked for fewer than 40 hours that week, Fiocca allegedly grabbed his manager by the throat, threw him on a desk, and threatened him and the company’s owner with further violence. The Indictment further alleges that later that same day, after the assault, Dougherty made escalating threats of economic harm to the owner of the company including: no longer allowing electricians on the job to work overtime, thus forcing the company to operate three shifts of employees; pulling all the electricians off the job entirely; and even trying to prevent the company from securing future work.

As a result, as charged in the indictment, from August 19, 2020 to January 17, 2021, Fiocca remained employed by the company, did little or no work, and continued to receive paychecks and benefits paid by the company.

“No one is entitled to wages they do not earn, and more importantly, no one should fear economic reprisal or physical violence for attempting to do honest business in Philadelphia,” said Acting U.S. Attorney Williams. “As alleged in the Indictment, Fiocca took advantage of his uncle’s position as a powerful leader of an influential union, assaulted a co-worker, and enriched himself at the expense of his employer – and Dougherty had his nephew’s back through all of it. These kinds of actions do not represent ‘business as usual,’ and will not be tolerated in this District.”

“When union leaders put their own interests ahead of its honest and hard-working members, they are not only breaching their obligation to protect union workers and their families, they are breaking the law,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “Such corruption must not go unchecked. No matter how long it takes, the FBI, particularly the determined agents and support staff of our Public Corruption Squads, will not rest until unscrupulous public officials and union leaders are brought to justice. The FBI is committing to protecting Philadelphia’s citizens and dedicated laborers.”

If convicted of all counts, the defendants face a maximum possible sentence of 380 years in prison, a $4,750,000 fine, a term of supervised release of two years, and a $1,900 special assessment.

An Indictment, Information or Criminal Complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorneys Frank R. Costello, Jr., and Richard P. Barrett.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced today that Briarwood Recreation, Inc., d/b/a Briarwood Day Camp (“Briarwood”), located in Furlong, PA, resolved allegations that it violated the Americans with Disabilities Act by denying a child the opportunity to participate in summer day camp programs because of his Type 1 diabetes (also known as insulin dependent diabetes).

The settlement resolves a complaint filed by parents of a young child alleging that, after the boy was diagnosed with Type I diabetes in 2017, Briarwood refused to permit him to continue to participate in the 2017 summer program, and also that Briarwood refused to consider and provide reasonable modifications that would allow the child to attend the 2018 summer day camp program. The complaint was filed under Title III of the Americans with Disabilities Act (ADA).

Title III of the ADA prohibits discrimination on the basis of disability by any person or entity, including any private camp or childcare program, that operates a place of public accommodation. Under the ADA, such entities must make reasonable modifications to their policies, practices or procedures when necessary to provide equal access to a child with a disability, unless a modification would fundamentally alter the nature of the goods and services. When a parent and a child’s physician determine that it is appropriate for a trained layperson to assist a child with diabetes care, a camp or childcare program must provide this as a reasonable modification under the ADA, unless doing so would fundamentally alter the program.

Briarwood submits that it remains committed to providing all children with diabetes an equal opportunity to attend the camp and to participate in all of its programs, services and activities. Under the terms of the settlement agreement, Briarwood will take certain remedial measures including:

• train its staff on the ADA and on diabetes management and develop a sample diabetes medical management plan;
• evaluate the application of each child with diabetes applying to attend the camp, on a case-by-case basis, and make reasonable modifications to permit children with diabetes to attend;
• designate an ADA compliance officer who will monitor compliance with the agreement and review requests for reasonable modifications, among other duties;
• pay $5,000 in compensation to the complainant; and,
• report to the United States on its compliance annually for three years.

“Summer camps, like other child care programs, play a critical role in parents’ ability to go to work or take care of other responsibilities of life. Parents must feel assured that their children will be welcomed, and not be unlawfully denied access to a summer camp on the basis of a disability,” said Acting U.S. Attorney Williams. “We appreciate Briarwood working cooperatively with the United States Attorney’s Office to better understand its obligations under the ADA, and we will continue to work to ensure that summer camp and child care programs are in compliance with the ADA.”

The settled civil claims are allegations only. There has been no determination of civil liability.

Assistant United States Attorney Stacey L. B. Smith handled the case in the Eastern District of Pennsylvania, working jointly with the Civil Rights Division of the Department of Justice.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that S.A. Taylor, LLC (“S.A. Taylor”) has agreed to settle claims under the False Claims Act and to pay $561,411.72 based on allegations that the company caused the submission of falsified payroll records as part of two United States Department of Veterans Affairs (the “VA”) construction projects.

S.A. Taylor, a Virginia-based construction company, bid on and was awarded subcontracts to work on two VA construction projects under prime contractor, CTA, I, LLC. Because the construction work was performed for the federal government, all contractors and subcontractors were required, by law, to pay their workers prevailing wages. At the time, the prevailing wage was between $57 to $91.50 per hour, depending on the worker’s classification.

The government contends that S.A. Taylor paid its workers significantly less than the prevailing wage, but that it submitted falsified payroll records to make it seem as if the prevailing wage had been paid. CTA, unaware of the falsity, submitted the payroll to the VA which, in turn, reimbursed S.A. Taylor. Under this scheme, S.A. Taylor pocketed the difference while its workers were shorted wages they were legally due. CTA discovered the falsity during a subsequent arbitration when S.A. Taylor produced two sets of payroll records—one showing the prevailing wages which should have been paid and one showing the actual, lower wages which had actually been paid.

“The underlying False Claims Act lawsuit alleges that S.A. Taylor deliberately exploited its own workers despite a federal law guaranteeing those workers a prevailing wage,” said Acting U.S. Attorney Williams. “Today’s settlement reflects the reality that individuals and entities that exploit workers will be held accountable by the government.” 

“Today’s civil settlement reflects the VA OIG’s commitment to maintaining the integrity of VA’s construction contracts and ensuring full compliance with the law,” said Christopher Algieri, Special Agent in Charge of the VA Office of Inspector General’s Northeast Field Office. “We thank the U.S. Attorney’s Office and our law enforcement partners for their vital role in achieving this investigation’s successful outcome.” 

“This case is a great example of the OIG’s work with its law enforcement partners to actively investigate fraud involving federal contracts. We will continue to work with our law enforcement partners to protect the integrity of DOL programs and to ensure workers are paid proper wages for the work they perform,” said Acting Special Agent-in-Charge, Jonathan Mellone, Philadelphia Region, U.S. Department of Labor, Office of Inspector General.

This settlement resolved a lawsuit filed under the False Claims Act in the U.S. District Court for the Eastern District of Pennsylvania captioned United States ex rel. CTA, I, LLC v. S.A. Taylor, LLC and Scott Taylor, Civil Action No. 16-2919. Under the qui tam or whistleblower provisions of the False Claims Act, lawsuits like this one may be brought on behalf of the United States and the relator, here CTA, shares in any recovery by the government. The False Claims Act also permits the government to intervene and take over the lawsuit, as it did in this case. The relator was represented in this case by John Manfredonia of Manfredonia Law Offices, LLC and Joseph F. Bouvier of Mattioni, LTD. “We thank the relator and the relator’s counsel for bringing this issue to the government’s attention. Detecting fraud in government contracting is much easier when we have the cooperation of prime contractors like CTA” said Williams. The whistleblower in this case, CTA, will receive $101,054.11 as its share of the recovery.

This matter was investigated by the United States Department of Veterans Affairs Office of the Inspector General and the United States Department of Labor Office of the Inspector General. For the U.S. Attorney’s Office, the investigation and settlement were handled by Assistant U.S. Attorney Veronica J. Finkelstein, Auditor Dawn Wiggins, and Investigator Jeffrey R. Braun.

The claims resolved by this settlement are allegations only and there has been no determination of liability.

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Myron Rodos, 80, of Ambler, PA, was sentenced to five years in prison, three years of supervised release, and ordered to pay a fine of $300,000 by United States District Court Judge Chad F. Kenney for distributing controlled substances, namely opioids, outside the course of professional conduct and not for a legitimate medical purpose.

The defendant pleaded guilty in November 2019 to four counts of distribution of Schedule II controlled substances, and stipulated that he illegally distributed an additional 6,130 oxycodone (30 mg) pills and 3,670 methadone (10 mg) pills to patients in exchange for sex and money. Rodos, a physician, operated a medical practice in North Philadelphia as a prescription “pill mill” where he prescribed dangerous and addictive controlled substances to addicts for cash, and often in exchange for sex. The charges resulted from a lengthy FBI investigation that produced audio and videotape recordings made by a civilian source and an undercover agent that showed Rodos prescribe medically unnecessary hydrocodone in exchange for cash. Moreover, female patients, who became drug addicts while under the defendant’s ‘care’ reported to FBI agents that they routinely obtained prescriptions from Rodos for oxycodone and other controlled substances in exchange for sexual favors. 

“The U.S. Attorney’s Office is committed to stopping drug-dealing doctors like Rodos,” said Acting U.S. Attorney Williams. “As a physician, he was well aware of the inherently dangerous nature of the drugs he was selling.  But because of his greed and sometimes to satisfy his own lecherous intentions, he took advantage of vulnerable people struggling with addiction, piling on to the enormous opioid epidemic ravaging the neighborhoods of Philadelphia.”

“It’s hard to understand how a longtime physician, trained to help and to heal people, could be this depraved,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “Dr. Rodos used his patients’ addictions against them, readily doling out powerful opioids in exchange for money or sex acts. The FBI and our partners are doggedly working to put drug-dealing doctors like him out of business, as we battle our country’s opioid epidemic.”

“Doctors are expected to help their patients, not take advantage of them,” said Maureen Dixon, Special Agent in Charge for the Office of the Inspector General, Department of Health and Human Services. “HHS-OIG and our law enforcement partners will continue to work together to protect patients from illegally prescribed prescription drugs.”

The case was investigated by the Federal Bureau of Investigation and Health and Human Services, Office of Inspector General, and is being prosecuted by Assistant United States Attorney M. Beth Leahy.