Eastern District of Pennsylvania

PHILADELPHIA – U.S. Attorney William M. McSwain announced that Leslie Acosta, former Pennsylvania State Representative and former employee of the Juniata Community Mental Health Clinic, was sentenced today to seven months in federal prison by U.S. District Court Judge Joel H. Slomsky.  Acosta was also ordered to pay $623,000 in restitution.

Acosta had previously pled guilty to conspiracy to commit money laundering.  The charge arose out of Acosta’s agreement to cash unearned checks from the Clinic and give the cash to Renee Tartaglione, who at the time was President of the Board of Directors of the Clinic.  Acosta agreed to cooperate with the government in its investigation of Tartaglione and testified at Tartaglione’s federal criminal trial in 2017. 

“Today’s sentence recognizes the need to punish those who help others steal money from nonprofit corporations,” said U.S. Attorney McSwain. “It reinforces the important principle that nonprofit organizations, especially those that provide services to the disadvantaged, exist for the people they serve and not for the personal enrichment of their leaders.  Our office will continue to aggressively pursue those who participate in schemes to steal from nonprofits.”

The case is being investigated by the Federal Bureau of Investigation and the Internal Revenue Service. It is being prosecuted by Assistant U.S. Attorney Bea L. Witzleben and Department of Justice Trial Attorney Peter Halpern.

PHILADELPHIA – U.S. Attorney William M. McSwain announced that former Philadelphia Police Department Sergeant Brian Smith, 35, of Philadelphia, PA, was sentenced today to 15 months’ imprisonment, three years’ supervised release, a $10,000 fine, and a $200 special assessment. U.S. District Judge Gerald Pappert imposed the sentence. Smith previously pled guilty to two counts of soliciting a bribe.

According to court papers, Smith joined the Philadelphia Police Department (PPD) as an officer in June 2005, and was promoted to the rank of Sergeant in March 2016. Between December 2015 and November 2016, Smith solicited and accepted weekly bribe payments of $200 from a tow truck operator in exchange for lucrative accident location information.  Smith would obtain this confidential law enforcement information from his PPD mobile data terminal and immediately send it by text messages to the tow truck operator in exchange for the corrupt payments.  Smith also accepted monthly bribe payments of $800 per month from a second tow truck operator for such information.

Smith’s conduct unlawfully circumvented the PPD’s rotational towing policy.  In 2008, the PPD instituted the policy, which requires patrol officers to notify Police Radio of any accident that requires vehicle towing. Police Radio maintains an accurate list of towing companies for an equitable rotation and distribution of towing assignments and calls a tow truck operator directly off the list. The City of Philadelphia instituted this rotational program as a public safety and consumer protection measure to stop wreck-chasing and to prevent accident victims from being taken advantage of by price-gauging tow truck operators.  The program came in response to a series of highly publicized, violent encounters between tow truck operators who competed for the potentially lucrative work of towing cars damaged in accidents.

“Our efforts in this case illustrate that my Office is committed to stamping out corruption wherever it takes place,” said U.S. Attorney McSwain.  “As a Sergeant in the Philadelphia Police Department, Smith repeatedly abused his position of trust. Today’s sentence makes plain that public officials who subvert the rule of law like this to line their own pockets will pay the price—and the only currency we accept will be their freedom.”

"It's grimly ironic, and beyond disappointing, that Brian Smith chose to game a system instituted in the interests of public safety and fair play," said Michael T. Harpster, Special Agent in Charge of the FBI's Philadelphia Division. "What he saw as an easy way to pad his paycheck on the sly, federal law deems clear corruption. Public servants, particularly in law enforcement, must be held to the highest of ethical standards. Those falling short, like former Sergeant Smith, must be rooted out—and firmly held to account."

The case was investigated by the Federal Bureau of Investigation and the Philadelphia Police Department, Internal Affairs Division, and is being prosecuted by Assistant United States Attorney Michelle L. Morgan.

PHILADELPHIA – U.S. Attorney William McSwain announced today that his Office is co-hosting an outreach event aimed at educating criminal justice professionals and the public about the obstacles and challenges ex-offenders face when returning home from prison.

On Friday, June 29 at 9:00 a.m., as part of Re-entry Awareness Month in Philadelphia, several agencies are joining forces to host a prisoner re-entry simulation at the Strawbridge Building in Philadelphia. The event is hosted by the U.S. Attorney’s Office for the Eastern District of Pennsylvania, U.S. Department of Health and Human Services Administration for Children & Families, Office of Child Support Enforcement, The MENTOR Program, and the National Workforce Opportunity Network. The simulation is intended to educate the public and criminal justice system professionals who assist with re-entry transition about the complex challenges prisoners face when they return home from prison. The simulation will provide a way for participants to stand in the shoes of individuals just released from prison, which in turn will help them better anticipate and meet their needs.

Titled Get Ready, Get Set, Get Out: A Day in the Life of a Returning Citizen, the program will ask participants to assume identities of ex-offenders and to participate in activities designed to simulate the first month of an individual’s release. Throughout the course of two hours, participants complete various tasks such as getting a driver’s license, reporting to probation, attending drug treatment and counseling, and attending to other basic life requirements to become a productive citizen and avoid re-incarceration. 

The simulation is open to the public, and the details are provided below:

WHEN:       Friday, June 29, 2018, from 9:00 a.m. to 12:00 p.m.

WHERE:     The Strawbridge Building, Ben Franklin Conference Center, 801 Market Street, Suite 9101-9102, Philadelphia, PA 19107

Registration is required. 

To register visit: https://www.eventbrite.com/e/get-ready-get-set-get-out-a-day-in-the-life-of-a-returning-citizen-tickets-46985480838.

PHILADELPHIA - U.S. Attorney William M. McSwain announced today that the United States filed a civil complaint against John Paul Ryan and Mary Motz Ryan, a married couple in Bucks County, Pennsylvania, and a telemarketing company that they operate together, Scholars in Print. The civil complaint alleges that they violated the False Claims Act by shipping unordered textbooks to the Federal Bureau of Prisons and demanding payment. Also today, the government filed a joint motion asking the court to enter a stipulated order and consent judgment to resolve the matter. The proposed resolution will require the court’s approval before it takes effect.  

The government’s complaint alleges that Scholars and Print, acting through the Ryans, made unsolicited telemarketing calls to Bureau of Prisons facilities throughout the country in an attempt to sell textbooks for use in prison libraries. According to the complaint, most facilities said no, but Scholars in Print shipped textbooks anyway and then sent unpaid bills to collection agencies. When confronted, Scholars in Print allegedly stated that the facilities had ordered the textbooks during the telemarketing calls. The complaint alleges that those assertions were false. Other times, Scholars in Print allegedly offered to send the facilities a free sample, and then invoiced them—a classic bait and switch.

The complaint contains several examples of false claims. In one of them, a Bureau of Prisons official allegedly refused to purchase textbooks from Scholars in Print during an unsolicited telemarketing call. John Ryan allegedly hung up on him, prompting the official to email the company to confirm his refusal to order textbooks. A few weeks later, the company allegedly sent textbooks to the same official. During a subsequent call to report the delivery, Ryan allegedly described himself, falsely, as “Dr. Ryan, one of the volunteers here,” and falsely claimed to be “reading from a conversation” presumably documenting that the official had ordered the textbooks.

On another occasion, Ryan allegedly identified himself as Edward Teach—more famously known as Blackbeard, the eighteenth century pirate—and offered a free sample of textbooks to a prison psychologist. The complaint alleges that Ryan then invoiced the prison $331 for these “free” textbooks. According to the complaint, Ryan told investigators that he sometimes identified himself as Edward Teach during telemarketing calls because “you don’t want people to know your name.”

On still another occasion, Scholars in Print demanded that a prison facility pay $680.90 for textbooks that the facility did not order. This demand prompted the facility to send a letter asking the company to stop shipping books for review. Scholars in Print then sent the same facility additional books and an invoice demanding another $435.00.

If approved by the court, defendants will pay a civil penalty of $75,689 for submitting false claims. They will also refrain from marketing products to any federal agency through unsolicited communications or telemarketing.

“The False Claims Act is a powerful tool to stem the tide of fraud against the government, and the allegations in this complaint fall squarely in that category,” said U.S. Attorney William M. McSwain. “Those who try to cheat a federal agency out of taxpayer money will not get away with it, and this case demonstrates our Office is ready, willing, and able to put a stop to this kind of behavior.”

“The OIG is committed to investigating individuals who attempt to defraud taxpayers and the Bureau of Prisons. We will work tirelessly with our law enforcement partners to ensure those who try to cheat the system are held accountable,” stated Lewe F. Sessions, Special Agent-in-Charge of the U.S. Department of Justice Office of the Inspector General’s Fraud Detection Office.   

Assistant U.S. Attorney Michael S. Macko handled the case, which arose from an investigation led by the U.S. Department of Justice, Office of the Inspector General.

The allegations against the Ryans and Scholars in Print are allegations only and not findings of liability.

 

Reading, PA – U.S. Attorney William M. McSwain announced that Douglas M. Marinos, 56, a licensed attorney, was sentenced on June 22 to serve one year in federal prison for tax fraud. 

On January 18, 2018, Marinos pled guilty to one count of willfully failing to collect, truthfully account for, and pay over to the United States taxes owed by his Allentown law firm. He was sentenced by U.S. District Judge Jeffrey L. Schmehl.

From 2008 to 2015, Marinos misrepresented to his firm’s employees that money he had withheld from their paychecks had been paid to the IRS to fund their Social Security and Medicare contributions.

In total, Marinos failed to pay $229,548.92 in required payroll taxes on behalf of his firm.

“When he entered the practice of law, the defendant swore to ‘obey and defend’ the laws of Pennsylvania and the United States,” said U.S. Attorney McSwain. “Instead, the defendant abused the trust placed in him by his employees and broke the law by using this money to pay his own creditors.”

The case was investigated by the IRS Criminal Investigation Division and prosecuted by Assistant United States Attorney Sean P. McDonnell.

PHILADELPHIA – U.S. Attorney William M. McSwain announced three separate indictments charging individuals with illegally re-entering the United States.

Efrain Tellez-Perez, a/k/a “Efrain Tellez,” of Philadelphia, PA, was charged by indictment yesterday with illegal reentry after deportation. The indictment alleges that on or about May 14, 2018, Tellez-Perez, an alien, and native and citizen of Mexico, was found in the United States after having been deported from the United States on or about January 29, 2010, March 6, 2011, and March 11, 2011. 

The case was investigated by Immigration and Customs Enforcement, Enforcement and Removal Operations (“ERO”), and is being prosecuted by Assistant United States Attorney Josh A. Davison.

Wilken Rahames Antigua-Diaz, a/k/a “Christopher Serrano,” of Philadelphia, PA, was charged by indictment yesterday with illegal reentry after deportation. The indictment alleges that on or about May 11, 2018, Antigua-Diaz, an alien, and native and citizen of the Dominican Republic, was found in the United States after having been deported and removed from the United States on or about February 23, 2011 and May 29, 2013.

The case was investigated by Immigration and Customs Enforcement, Enforcement and Removal Operations (“ERO”), and is being prosecuted by Assistant United States Attorney Roberta Benjamin.

Antonio Frutos-Zavala, of Reading, PA, was charged by indictment yesterday with illegal reentry after deportation.  The indictment alleges that in March, 2018, Frutos-Zavala, an alien, and native and citizen of Mexico, was found in the United States after having been deported from the United States on or about November 15, 1998, March 28, 2008, March 26, 2008, and November 8, 2017.

The case was investigated by Immigration and Customs Enforcement, Enforcement and Removal Operations (“ERO”), and is being prosecuted by Assistant United States Attorney Josh A. Davison.

If convicted, each defendant faces a maximum possible sentence of two years.

PHILADELPHIA – U.S. Attorney William M. McSwain was honored to speak today at the Delaware Valley Intelligence Center Regional Roundtable in Philadelphia, PA. The Delaware Valley Intelligence Center (DVIC) was established to create cross-jurisdictional partnerships between agencies and serves as the informational fusion center for the Delaware Valley region. U.S. Attorney McSwain’s remarks are below.

*****

Thank you all for gathering here today. I would especially like to thank Inspector Walter Smith, Executive Director of the Delaware Valley Intelligence Center, Philadelphia Police Department, and Stacy Irving, Senior Advisor, Homeland Security Planning & Strategic Partnerships, Delaware Valley Intelligence Center, Philadelphia Police Department, for inviting me to speak. It was not too long ago that many of us were gathered in this same place for the 2018 Anti-Terrorism Advisory Council Conference, which was an in-depth and highly educational program that helped all of us to further our collective mission of keeping our country safe.

Safeguarding our national security is critically important to the U.S. Attorney’s Office, just as it is for everyone here today. It is also, without question, the number one priority of the U.S. Department of Justice. The Department of Homeland Security has prioritized state and major urban area fusion centers such as this one, because they know that intelligence collection and information sharing are critical in this fight. That is why the Delaware Valley Intelligence Center is so important. This cross-jurisdictional partnership between local, state, and federal agencies, as well as private sector participants, ensures that the Delaware Valley region has a community-focused public safety strategy. Everyone benefits from a continuous flow of intelligence and information to assist public safety field operations.

Our region has already seen firsthand how these relationships can help. For example, on May 12, 2015, an Amtrak Northeast Regional Train derailed after departing Philadelphia on its way to New York, which was the worst train disaster that our area has experienced in decades. Moments after the crash, emergency calls went out across the area, and scores of first responders from federal, state, and local law enforcement authorities responded. There is no doubt that authorities knew who to call that day because of relationships built through groups like this one.

We can only succeed with the collaboration and partnership of each of you. And those partnerships cannot be built in a day. We all need to work together when times are good so that we know what to do and who to call when they are not. To this end, one of my first initiatives after I became U.S. Attorney in April was to visit the nine counties that make up the Eastern District of Pennsylvania and meet with their district attorneys and local law enforcement leaders. It is a priority of my Office to continue to foster these relationships and always keep our lines of communication open. These personal connections are crucial to successful prosecutions everywhere across this region.

Additionally, I want law enforcement to know how much my Office appreciates them. The first public speech that I gave after becoming U.S. Attorney was to the Philadelphia Police Department leadership and to recruits at the Police Academy. As I said to them, no prosecutor has ever prosecuted any case without the help of an outstanding law enforcement partner, whether that is at the federal, state, or local level. There are no greater heroes than those in law enforcement who have dedicated their lives to keeping our communities safe – to the point that they’re willing to risk their own lives to do it. And there is no better way to support law enforcement than to make sure that they have the assistance needed to protect our community from terrorism.

I am aware of some of the difficulties in prosecuting national security cases. There are many law enforcement partners to consult and so many levels of review in the Department of Justice that it often may feel difficult to see a prosecution through to its natural conclusion. I want to share with you that the Department of Justice is working to eliminate some of those hurdles. DOJ has put new procedures in place to streamline the review process to make sure that if a national security prosecution is the correct approach, DOJ will have the most efficient process in place to pursue these significant cases.

My Office has had great success in the past few years in our efforts to prosecute national security cases and hold people accountable for terrorism, violations of the Armed Export Control Act, and cybercrime. For example, Keonna Thomas, a Philadelphia woman who was charged and pled guilty to one count of attempting to provide material support to a terrorist organization, was sentenced to eight years in federal prison. Thomas plotted to travel to Syria to join the Islamic State and told another individual that taking part in a martyrdom operation “would be amazing.” This case, prosecuted by First Assistant U.S. Attorney Jennifer Williams and a colleague from the Counterterrorism Section in the Justice Department’s National Security Division, was investigated by the FBI’s Joint Terrorism Task Force and the Philadelphia Police Department. 

And many terrorism cases involve agency partnerships not only at home, but also abroad. Ali Charaf Damache, also known as “Theblackflag,” was indicted in the Eastern District of Pennsylvania in 2011 and extradited from Spain last year for his involvement in conspiring to provide material support and resources to terrorists. He is currently awaiting trial. Two of his co-conspirators, Colleen LaRose (also known as “Jihad Jane”) and Jamie Paulin Ramirez (also known as “Jihad Jamie”), have previously pled guilty and are serving ten years and eight years in prison, respectively. Again, First Assistant U.S. Attorney Williams prosecuted these cases in conjunction with the Counterterrorism Section of the Justice Department’s National Security Division, the Office of International Affairs in the Justice Department’s Criminal Division, the FBI’s Joint Terrorism Task Force in Philadelphia, the FBI Field Divisions in New York, Baltimore, Washington D.C., and authorities in Ireland and Spain. Sometimes it takes many hands and many minds across the globe to get the job done right.

Our National Security section in the U.S. Attorney’s Office does not only focus only on traditional terrorism cases. For example, we uphold the Arms Export Control Act, which prohibits the export of high tech military technology that is critical to the national security and foreign policy interests of the United States. We must keep important technology out of the hands of potential adversaries. In United States v. Baltutski, we charged a group of individuals who conspired to purchase and unlawfully export night vision devices to Belarus. Baltutski arranged for hundreds of thousands of dollars to be secretly wired, via offshore shell companies, to purchase these items, pay for shipping, and pay his network of buyers. For his efforts, Baltutski received a sentence of 15 years’ incarceration, which is one of the longest sentences under the Armed Export Control Act in U.S. history. This case was prosecuted by Assistant U.S. Attorney Robert Livermore and colleagues from DOJ’s Organized Crime and Gang Section, and the National Security Division, and was investigated by the U.S. Immigration and Customs Enforcement, Homeland Security Investigations and the FBI. That case took extensive and dedicated investigative work to result in such a significant sentence.

We also continue to defend ourselves from cybercrime attacks. More and more criminals are exploiting the convenience and anonymity of the Internet to commit crimes and cause serious interruptions and destruction across the United States and around the world. It is my belief that cybercrime will only become more sophisticated, as technology advances and criminals seek to invade and destroy our financial markets, electrical power grids, emergency response systems, and nuclear plants, often from the comfort of their own homes. In the last few years, the U.S. Attorney’s Office has successfully prosecuted numerous cybercrimes, including individuals who hacked into everything from a gas company’s computers, to systems that read utility meters remotely, to Comcast’s server. We are dedicated to continuing our efforts in this field.

And this really just scratches the surface. As you all know, so many of our cases and investigations are not currently public. And many matters do not end in prosecution, but instead produce new investigative leads and sources of information that can be equally (if not more) valuable than a case in the court system.

As we have been sadly reminded by recent events, not all terrorism is international. Far too often in this country, we as a nation have grieved the brutal murders of innocent people as a result of mass shootings and domestic terrorism. Americans should be safe from such terror, no matter who or where they are. Studying in school or going to work, worshiping at church or cheering for friends at a marathon, relaxing at a movie theater or enjoying an evening at a night club – all of these activities should be safe-havens for every American. But as we know, places like these have turned into horrific crime scenes over the past few years where innocent lives have been lost. One more mass shooting is one too many.

The U.S. Attorney’s Office takes seriously every threat of gun violence in our community and will do everything in our power to prevent tragedy from occurring. As but one example, we recently charged An-Tso Sun by federal complaint with possessing ammunition while being in the United States on a nonimmigrant visa, which is a felony under federal law. According to the complaint, on or about March 26, 2018, Sun told a fellow student, “Hey, don’t come to school on May 1st . . . I’m going to come here armed and shoot up the school.” Then he added: “Just kidding.” But this was no laughing matter, as the complaint alleges that multiple items were recovered from Sun’s bedroom, including stockpiles of ammunition, and various firearm accessories and shooting equipment. This case is on-going.

I am proud to say that this was another example of numerous investigative and operational bodies working together. From the student who first reported the alleged threat, to the Upper Darby Police Department and the Delaware County District Attorney’s Office, to the Department of Homeland Security, Homeland Security Investigations and my Office, we worked together to successfully prevent a potential school tragedy.

But we cannot do it alone. I recently addressed the media about the An-Tso Sun case and I urged all parents and citizens to take notice of what is going on around them. We need to remind people that law enforcement is not the first line of defense. That duty belongs to our citizens. They are the ones who will see the first clues that something is amiss in their everyday lives. They are the ones who might get a bad feeling about something at their schools, in their offices, during their social activities, and who will need to pick up the phone. As a group, we need to continue to encourage people to make that call. There are too many stories of parents, of teachers, of neighbors, who belatedly say they “always knew something was wrong” about someone in their lives, but they didn’t sound the alarm and instead chose to stick their heads in the sand. We need them to make the call.

When they do make the call, they will call one of us. And because of the partnerships built through cooperative intelligence centers like DVIC, we will be ready.

Thank you for your partnership with my Office, thank you for all that you do for our community, and God Bless you.

PHILADELPHIA – U.S. Attorney William M. McSwain announced than an indictment was unsealed today charging Concepcion Cedano, 48, of Camden, New Jersey with one count of criminal conspiracy to commit theft of public funds and one count of theft of public funds.

According to the indictment, Cedano and her co-conspirators engaged in a scheme to steal public money by obtaining federal refund checks fraudulently caused to be issued by the United States Treasury. Cedano deposited at least 60 fraudulent refund checks into five bank accounts under her control, resulting in a theft of $298,779.52 from the United States government. 

If convicted, the defendant faces a maximum possible sentence of 15 years of imprisonment, two years of supervised release, a fine of $500,000, and a special assessment of $200.

The case was investigated by Internal Revenue Service Criminal Investigation and is being prosecuted by Assistant United States Attorney Priya De Souza.

PHILADELPHIA – U.S. Attorney William M. McSwain announced that Salim Davis, 33, of Philadelphia, was charged today by indictment with one count of possession of a firearm and ammunition by a convicted felon, one count of possession with intent to distribute a controlled substance, and one count of possession of a firearm in furtherance of a drug trafficking crime.

According to the indictment, on December 29, 2017, Davis was in possession of a Smith & Wesson, Model SD40VE, .40 caliber pistol, loaded with 10 live rounds of ammunition, as well as Alprazolam, a Schedule IV controlled substance. The indictment alleges that the defendant possessed the Alprazolam, also known as Xanax, with the intent to distribute it, and that he possessed the firearm in furtherance of the drug trafficking crime.

If convicted, Davis faces a maximum term of life imprisonment in prison, with a mandatory minimum of five years’ imprisonment, up to five years of supervised release, a $750,000 fine, forfeiture, and a $300 special assessment.

The case was investigated by the Philadelphia Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives.  It 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 – U.S. Attorney William M. McSwain announced that James Franklin Hill, 55, of South Orange, New Jersey, was charged today by indictment with one count of wire fraud in connection with a scheme that involved a classic “bait-and-switch” scam with a set of 24 Canadian Gold Maple Leaf coins.

According to the indictment, Hill allegedly responded to Craigslist advertisements posted by coin dealers and collectors located in Pennsylvania, Delaware, New Jersey, New York, North Carolina, Florida, Tennessee, Ohio, Illinois, Wisconsin, Arizona, and California. The indictment alleges that Hill presented the coin dealers and collectors with the opportunity to purchase a set of 24 Canadian Gold Maple Leaf coins at prices ranging from $19,000 to $30,000. Hill allegedly showed a genuine set of coins to the purchasers, and then switched the genuine set of coins with a fake set before the transactions were concluded. In November 2016, Hill allegedly sent text and electronic messages to a purchaser in Oxford, Pennsylvania before selling the fraudulent coins to the purchaser. The indictment alleges that between 2010 and 2017, Hill allegedly defrauded his coin purchasers of more than $250,000.

If convicted, the defendant faces a maximum possible sentence of 20 years’ imprisonment, three years of supervised release, a $250,000 fine, and a $100 special assessment.

The case was investigated by the Federal Bureau of Investigation, the Oxford Borough (Pennsylvania) Police Department, and other law enforcement agencies in Delaware, New Jersey, New York, North Carolina, Florida, Tennessee, Ohio, Illinois, Wisconsin, Arizona, and California. Based on the evidence, authorities believe there may be additional victims who have not yet been identified. Anyone with information about this matter is encouraged to contact the Federal Bureau of Investigation in Newtown Square, PA at (610) 353-4500. Callers may remain anonymous.

The case is being prosecuted by Assistant United States Attorney Anita Eve.

PHILADELPHIA – U.S. Attorney William M. McSwain announced that an indictment has been unsealed today charging Calvin Roeder, 31, of Pottstown, Pennsylvania, with two counts of distribution of child pornography and one count of possession of child pornography.

The indictment alleges that between June 2, 2017 and June 23, 2017, Roeder distributed images of child pornography, and on August 24, 2017, he possessed images of child pornography.

If convicted, the defendant faces a maximum possible sentence of fifty years in prison and a mandatory minimum sentence of five years in prison.

This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.

The case was investigated by the Department of Homeland Security, Homeland Security Investigations (“HSI”), and is being prosecuted by Assistant United States Attorney Josh A. Davison.

WASHINGTON, DC—United States Attorney William M. McSwain announced today that three Assistant United States Attorneys and a forensic analyst from the Eastern District of Pennsylvania were recognized for their distinguished public service at the 34th Annual Director’s Awards Ceremony.  U.S. Attorney McSwain, along with honorees Assistant United States Attorneys David Ignall, Mary Beth Leahy, David Troyer, and forensic analyst Cyndi Fusco, were invited to Washington D.C. for the event held on June 15 in the Great Hall at the Robert F. Kennedy Department of Justice Building.  Deputy Attorney General Rod Rosenstein and Director James Crowell, IV, of the Executive Office of the U.S. Attorneys (EOUSA), presented the awards.

“Every day, Dave, Mary Beth, Dave, and Cyndi serve the people of our District by bringing to bear their superior abilities and steadfast dedication in pursuing justice.  I was gratified that EOUSA spotlighted my colleagues’ work in this meaningful way, and I know I speak for everyone when I say this office is very proud of their achievements.”

These AUSAs were recognized for their significant contributions on two specific cases, and Ms. Fusco was honored for her outstanding work as a forensic analyst in the Criminal Division, as follows:

United States v. Brian Hartline and Barry Bekkedam – AUSA David Ignall

AUSA Ignall successfully prosecuted this fraud conspiracy case culminating in a nationally significant four-week trial of Brian Hartline and Barry Bekkedam, co-founders of NOVA Bank. Hartline and Bekkedam were convicted for attempting to defraud the Troubled Asset Relief Program (TARP) established to bring the country out of the 2008-09 fiscal crisis.

During the relevant time period, Hartline served as the Chief Executive Officer and President of NOVA Bank, and Barry Bekkedam served as NOVA Bank Board Chairman.  Bekkedam also owned and operated a financial advisory company, Ballamour Capital Management, and advised Ballamour clients to invest in NOVA Bank.  This complex case involved an attempt to defraud the TARP out of more than $13 million through a scheme to make NOVA bank appear more financially sound than it was so that NOVA would be eligible to receive the TARP funds.  Both defendants were convicted of conspiracy to defraud the United States, major fraud against the United States, and making false statements to government regulators and were sentenced to prison.

United States v. William O’Brien et al. – AUSA Mary Beth Leahy and AUSA David Troyer

AUSA Leahy and AUSA Troyer successfully prosecuted William O’Brien, III, a doctor of osteopathic medicine who operated a “pill mill” through multiple medical practices in the Philadelphia area.  O’Brien used members of the Pagans Outlaw Motorcycle Gang to run his offices, recruit fake customers, enforce collections, and distribute large quantities of oxycodone, methadone, and other drugs to drug dealers and drug addicts.  The scheme was one of the largest in the Philadelphia area, generating millions of dollars in illegal drug revenues laundered via various means and resulting in the death of at least one 30-year-old patient who overdosed from a lethal combination of oxycodone and methadone.    

Financial Analyst – Cyndi Fusco

In her fourteen years with the office, Ms. Fusco has spearheaded financial investigations of our most complex cases.  She has investigated fraud, public corruption, embezzlement, money laundering, extortion and tax evasion.  Ms. Fusco has created detailed analyses of financial facts, prepared summary charts, prepared witnesses for testimony, testified as the financial investigator, and directed interviews involving financial accountants and experts.  She also developed a protocol to monitor social media of targets to locate hidden assets.  Her cases have resulted in lengthy sentences, large forfeitures, and restitution. 

 

 

 

 

 

 

 

PHILADELPHIA – U.S. Attorney William M. McSwain announced today that Romeo Lucas-Lopez, a/k/a “Romeo Lopez,” of Upper Darby, PA, was charged by indictment with illegal reentry after deportation.

 The indictment alleges that on or about May 17, 2018, Lucas-Lopez, an alien, and native and citizen of Mexico, was found in the United States after having been deported from the United States on or about November 7, 2010 and November 15, 2010.  If convicted, the defendant faces a maximum possible sentence of two years.

The case was investigated by Immigration and Customs Enforcement, Enforcement and Removal Operations (“ERO”), and is being prosecuted by Assistant United States Attorney Laurie Magid.

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

 

PHILADELPHIA – U.S. Attorney William M. McSwain announced today that a former federal air marshal with the Newark, New Jersey field office has been charged by indictment with making various threats against his former colleagues.

An indictment was unsealed today charging Julian Terrell Turk, 47, of Levittown, PA, with interstate communication of threats. Turk, who filed multiple Equal Employment Opportunity complaints against the Federal Air Marshal Service, and more specifically against FAM Executive Management of the Newark Field Office, allegedly contacted a retired Navy SEAL for information on how to make and use explosives and also to provide a list of books and resources on long range rifle shooting.

In an April 13 email to a former coworker, Turk wrote:

“There comes a time in one's life that he has to take a stand against what's ‘right’ and not ‘white’ here, now, is my chance to do that. These (expletive) have gone out of their way to (expletive) with me in the worst way possible. And frankly, I've had a Got Damn nuff of it. So, I've decided to (expletive) with them. I'm going to take the fight to these (expletive)!”… “I'd never ask one of yall to take-on something that would get any of you in trouble. But sometimes enough is enough and you have to take a stand. These (expletive) think they're untouchable and that they can't be gotten to. I'm going to show them how to (expletive) with someone.” . . . “As I've said, I'm taking the fight to these (expletive) now. Know that, I'd never take my own life, my children are always a for-thought on my mind. But what kind of man would I be if I didn't live up to my motto and creed of ‘Being a Man for Others!’ So I've come up with a plan to get them for what they've done to me.”

Turk also sent a series of emails to a former marshal in which he said, among other things, “I've come up with a plan to get them for what they've done to me. In the event that something happens to me, please make sure to look after my children.”

If convicted, the defendant faces a maximum possible sentence of five years in prison, three years’ supervised release, a $250,000 fine, and a $100 special assessment.

The case was investigated by FBI and is being prosecuted by Assistant United States Attorney Joseph A. LaBar.

PHILADELPHIA – U.S. Attorney William M. McSwain announced today that a Philadelphia personal injury law firm, Rosenbaum & Associates, and its principal, Jeffrey Rosenbaum, Esq., have entered into a settlement agreement with the United States to resolve allegations that they failed to reimburse the United States for certain Medicare payments the government had previously made to medical providers on behalf of firm clients who sought medical care.

The government’s investigation arose under the Medicare Secondary Payer provisions of the Social Security Act, which authorizes Medicare, as a secondary payer, to make conditional payments for medical items or services under certain circumstances. When an injured person receives a settlement or judgment, Medicare regulations require entities who receive the settlement or judgment proceeds, such as the injured person’s attorney, to repay Medicare within 60 days for its conditional payments. If Medicare does not receive timely repayment, these same regulations permit the government to recover the conditional payments from the injured person’s attorney and others who received the settlement or judgment proceeds.

At various points before March 2017, Medicare made conditional payments to healthcare providers to satisfy medical bills of nine of the firm’s clients, at least one of whom had declared bankruptcy. Between May 2011 and March 2017, Medicare demanded repayment of the Medicare debts incurred from those conditional payments.

Under the terms of the settlement agreement, Rosenbaum agreed to pay a lump sum of $28,000. Rosenbaum also agreed to (1) designate a person at the firm responsible for paying Medicare secondary payer debts; (2) train the designated employee to ensure that the firm pays these debts on a timely basis; and (3) review any outstanding debts with the designated employee at least every six months to ensure compliance. In addition, Rosenbaum acknowledged that any failure to submit timely repayment of Medicare secondary payer debt may result in liability for the wrongful retention of a government overpayment under the False Claims Act.

This settlement agreement should remind personal injury lawyers and others of their obligation to reimburse Medicare for conditional payments after receiving settlement or judgment proceeds for their clients. “When an attorney fails to reimburse Medicare, the United States can recover from the attorney—even if the attorney already transmitted the proceeds to the client,” said U.S. Attorney William M. McSwain. “Congress enacted these rules to ensure timely repayment from responsible parties, and we intend to hold attorneys accountable for failing to make good on their obligations.”

The case was handled by Assistant U.S. Attorney Michael S. Macko, with assistance from the United States Department of Health and Human Services, Office of the General Counsel, Region III.

 

PHILADELPHIA – U.S. Attorney William M. McSwain announced today that a Reading, Pennsylvania woman—the eighth member of a Reading-area bank fraud ring—has been charged with fraud.

A criminal information has been filed charging, Xavanna Olivera, 19, with one count of bank fraud. Olivera is alleged to be a member of a bank fraud ring operated by Steven Ronald Randall of Philadelphia.

Randall previously pleaded guilty on March 15, 2018, to one count of bank fraud and five counts of aggravated identity theft before U.S. District Judge Joseph F. Leeson, Jr. As part of his guilty plea, Randall admitted that he was a leader of a scheme to defraud First National Bank. Randall further admitted that as a result of this scheme, FNB sustained actual losses in excess of $76,519, with intended losses of in excess of $115,782. Randall also admitted that he transferred funds to inmates incarcerated within the Pennsylvania Department of Corrections via accounts opened by others involved in the scheme.

The information alleges that in return for a share of the fraud proceeds, Olivera opened an account at FNB that she knew would be used to deposit fraudulent checks and to withdraw cash before the bank discovered that the checks were fraudulent.

Olivera faces a maximum sentence of 30 years’ incarceration, a five-year period of supervised release, and a fine of $1,000,000.

Olivera is the eighth member charged as part of this group. In addition to Olivera and Randall, the other members of the bank fraud ring previously charged are Jaylen Jefferson, 19, of Reading, Dawson Thomas, 19, of Mohnton, Rebecca Ilie, 25, of Reading, Linda Pacheco, 40, of Reading, Angel Ocasio, Jr., 20, of Reading, and Jair Peralta, 19, of Kenhorst.

The case was investigated by the United States Postal Inspection Service, the Federal Bureau of Investigation, and the Cumru Township Police Department and is being prosecuted by Assistant United States Attorney Michael S. Lowe.

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

PHILADELPHIA –U.S. Attorney William M. McSwain announced today that a Philadelphia man was charged with receiving and possessing child pornography.

Anthony Chiccini, 70, of Philadelphia, PA, was charged today by indictment with receiving and possessing a collection of more than 600 images and videos of children being sexually assaulted and depicted in sexually explicit positions on various dates in 2013 through 2018.

If convicted, the defendant faces a maximum possible sentence of 60 years’ incarceration, which includes a 5-year mandatory minimum term of imprisonment, five years up to a lifetime of supervised release, $750,000 in fines, and a $300 special assessment.

This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.

The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Michelle Rotella.                                                               

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

 

PHILADELPHIA – U.S. Attorney William M. McSwain announced that Scott Wayne, 58, of Easton, was charged this week by indictment with the distribution and possession of child pornography.

According to the indictment, Wayne possessed a computer hard drive which contained visual depictions that had been produced using materials that had been mailed, shipped, and transported in interstate and foreign commerce. The indictment alleges that the production of these visual depictions involved the use of a minor, including a prepubescent minor who had not attained 12 years of age, engaging in sexually explicit conduct, and the visual depictions were of minors engaging in sexually explicit conduct.

If convicted, the defendant faces a maximum possible sentence of forty years imprisonment, a mandatory minimum of five years imprisonment, a mandatory minimum of five years supervised release up to lifetime supervised release, a $500,000 fine, and $10,200 in special assessments. 

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

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 Attorney’s Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.

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

PHILADELPHIA – U.S. Attorney William M. McSwain announced that a Philadelphia man was charged today with an armed robbery of a Philadelphia pharmacy.

Ronald Hanible, 47, was charged by indictment with the armed robbery of Aspire Pharmacy at 4307 Locust Street.

 According to the indictment, on April 27, 2018, Hanible robbed Aspire Pharmacy at gunpoint and stole approximately $200 and quantities of Oxycodone and Xanax pills. It is further alleged that the defendant brandished the handgun at a store employee during the armed robbery.

Hanible is charged with one count of robbery which interfered with interstate commerce, one count of using, carrying and brandishing a firearm during and in relation to a crime of violence, and two counts of possessing with intent to distribute a controlled substance. 

If convicted of all charges, Hanible faces a maximum of life imprisonment, a mandatory-minimum imprisonment of seven years, which must be served consecutively to any other sentence imposed by the Court, six years up to lifetime supervised release, a $3,000,000 fine, and a $400 special assessment.

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

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

PHILADELPHIA – First Assistant U.S. Attorney Jennifer Arbittier Williams announced today that a Philadelphia investment adviser who bilked clients out of $1.6 million has pled guilty.

Carl Frederic Sealey, 43, chairman of Global Standard Industries Inc. (GSI) and SEK Industries Inc., pled guilty to fraud charges this week in connection with a scheme in which Sealey used his investors’ money to fund his own lavish lifestyle instead of using it to finance real estate deals.

Sealey claimed his company had more than $15 billion in managed domestic assets and another $33 billion offshore. Investors were led to believe that their investment was risk-free and that they would receive their monies back with interest within 90 days. Sealey would then represent to investors that their “deal” had been delayed and that they could get their money back more quickly if they invested additional monies for other “deals” that GSI had underway. 

In reality, there were never any real estate closings or business takeovers underway by anyone at GSI. When investors wired monies to accounts exclusively maintained by Sealey, he used a fraction of the monies to pay rent for GSI’s Philadelphia and New York offices and the salaries of GSI staff members, most of whom were retained from a temporary employment agency. Sealey used the majority of the monies received from investors to support his extravagant lifestyle, including hotel accommodations, restaurants, spa services, retail shopping, and other personal expenditures. 

“Individuals trust investment advisors with their life savings and thus their families’ economic well-being,” said First Assistant U.S. Attorney Williams. “The defendant blatantly betrayed that trust by making empty promises to investors with the ultimate goal of stealing their money and enriching himself.”

The investigation was led by the Federal Bureau of Investigation.  It is being prosecuted by Assistant United States Attorney Anita Eve.

PHILADELPHIA – U.S. Attorney William M. McSwain announced today that Nafis Mullins, 26, of Philadelphia, has been charged by indictment with possession of a firearm by a convicted felon. 

According to the indictment, on May 1, 2018, Mullins was in possession of a Glock, Inc., Model 22, .40 caliber semiautomatic pistol, s/n YC689US, loaded with 16 live rounds of ammunition.

If convicted, Mullins faces a minimum term of fifteen years in prison, up to five years of supervised release, a $250,000 fine, and a $100 special assessment.

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

 

PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams today announced that U-Haul Company of Pennsylvania and Miguel Rivera, the general manager of U-Haul’s Hunting Park location, were charged today with violating hazardous materials regulations. One of the alleged violations led to two fatalities.

The six-count indictment alleges the defendants violated United States Department of Transportation regulations related to classifying, handling, and packaging hazardous materials. The indictment further alleges that defendants filled two propane cylinders on June 29, 2014, and that one of those cylinders ruptured on July 1, 2014 while attached to a food truck parked on a Philadelphia public street. The indictment alleges the escaping propane ignited and briefly enveloped the food truck in a fireball, leading to the deaths of two people and grave injury to others nearby.

If convicted, U-Haul Company of Pennsylvania faces a maximum possible sentence of 5 years of probation, with a mandatory minimum term of 1 year of probation, a $3,000,000 fine, and a special assessment of $2,400. Miguel Rivera faces 15 years in prison, a 3-year period of supervised release, a $500,000 fine and a $200 special assessment.

The case was investigated by the Department of Transportation Office of Inspector General, the Federal Bureau of Investigation, and the Bureau of Alcohol, Tobacco, Firearms and Explosives, with assistance from the Philadelphia Police and the Philadelphia Fire Department. It is being prosecuted by Assistant United States Attorney Elizabeth Abrams.                                                             

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

PHILADELPHIA – U.S. Attorney William M. McSwain announced that the owners of a Yeadon, PA, tax preparation business were charged today in connection with a scheme to prepare fraudulent tax returns in order to generate unwarranted refunds.

Deron Joe and Edmund Dassin, the owners of Edron Tax Preparation Services, were charged today by superseding indictment with one count of conspiracy to defraud the United States and 15 counts of aiding and assisting in the preparation and filing of a false tax return.

According to the superseding indictment, Joe and Dassin prepared certain tax returns for clients for tax years 2008 to 2010 and falsely claimed on these returns that these clients had incurred unreimbursed employee business expenses. The indictment alleges the defendants knew their clients were not entitled to such refunds, as the clients had neither reported these expenses to the defendants nor provided any documentation to support such deductions. One of their clients was an IRS agent acting in an undercover capacity.

If convicted, the defendants face a maximum possible sentence of 47 years of imprisonment and a fine of $3.75 million.

The case was investigated by Internal Revenue Service’s Criminal Investigation Division and is being prosecuted by Department of Justice Tax Division Attorneys Chris O’Donnell and Kathryn Sparks and Assistant U.S. Attorney Tomika N.S. Patterson.

PHILADELPHIA – U.S. Attorney William M. McSwain announced today that a federal jury has convicted Romel Anthony, the last of the 19 defendants charged in the Khalil Smith indictment. Anthony was part of a violent drug gang that was responsible for, among other things, waterboarding, pistol-whipping, and torturing its victims with boiling water. Anthony was found guilty of one count of Attempted Possession with Intent to Distribute Cocaine. The other members of the drug gang either pleaded guilty or were previously convicted at earlier trials.

“This was an extremely violent drug organization and it’s a credit to our prosecutors and the investigators involved that every single member of this gang has now been convicted and taken off the streets,” said U.S. Attorney McSwain. “Gangs like this terrorize communities and hold neighborhoods hostage and this particular group is an example of why violent crime is a priority for both the Department of Justice and our office.”

“This conviction of the last member of the Khalil Smith home invasion robbery crew represents conclusive justice for the involved victims and their families and for the citizens of Philadelphia," said Special Agent in Charge Donald Robinson of the Bureau of Alcohol, Tobacco, Firearms, and Explosives. “This conviction is the culmination of nearly four years of relentless investigation by the men and women of ATF Philadelphia, local law enforcement, and our outstanding partnership with the United States Attorney’s Office.”

The investigation was led by the ATF, with assistance from the Philadelphia Police Department, the Hatfield Township Police Department, the Whitpain Township Police Department, and the Cherry Hill Police Department.  It is being prosecuted by Assistant United States Attorneys Salvatore Astolfi and Jeanine Linehan.

PHILADELPHIA – U.S. Attorney William M. McSwain today announced that a Philadelphia attorney who struggled to pay his law firm’s expenses was indicted on fraud charges.

Donald F. Manchel, 84, of Bryn Mawr, PA, was charged with wire and mail fraud.                       

The indictment alleges that on multiple occasions, Manchel used settlement funds due to clients to instead pay his firm’s business expenses, including payroll and employee insurance premiums. Additionally, he used the settlement funds due to one client to pay another client. According to the indictment, Manchel made false statements and engaged in acts of deception in an effort to hide the fact that he already had spent his clients’ settlement funds, and to avoid having to issue payment to clients of the settlement funds due to them.

“Under the law, attorneys are required to keep settlement funds separate from other money,” said U.S. Attorney McSwain. “And when an attorney deliberately deceives his clients, he must be held accountable.” 

If convicted, the defendant faces a maximum possible sentence of 220 years’ imprisonment, three years of supervised release, a $2.5 million fine, and a $2,000 special assessment.

The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Karen L. Grigsby.                                                                             

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

PHILADELPHIA – U.S. Attorney William M. McSwain announced today that Marcos Callejas-Nava, a citizen of Mexico and convicted heroin dealer, was sentenced this week to 57 months’ imprisonment.

Callejas-Nava had pleaded guilty to one count of conspiracy to distribute two kilograms of heroin and one count of possession with intent to distribute two kilograms of heroin. He is also facing deportation proceedings upon completion of his federal sentence. At the sentencing hearing, Judge Joel H. Slomsky noted his concern about the seriousness of the offense and the dangerousness of heroin in the community.

“The defendant was an active and eager participant in a cross-border conspiracy to import and distribute heroin in a region that has been ravaged by the deadly effects of heroin addiction and overdose. We are in the midst of an epidemic and we have to stop those who are bringing this poison into our communities,” U.S. Attorney McSwain stated.

The case arose out of an investigation by Montgomery County Detective Bureau (MCDB) Narcotics Enforcement Team (NET), the Drug Enforcement Administration (DEA) and the Montgomery County District Attorney’s Office Local Drug Task Force into a Mexican drug trafficking organization distributing kilogram quantities of heroin in the Philadelphia area. The case is being prosecuted by Assistant U.S. Attorney Jennifer Jordan.

PHILADELPHIA – U.S. Attorney William M. McSwain announced that a New Jersey couple has been ordered to pay $232,891.37 to the United States for overcharging the military for light assemblies. The defendants, Moorestown, New Jersey residents Babu Metgud and Shubhada Kalyani, operated Shubhada Industries, a defense contractor. The United States, as the plaintiff, moved for summary judgment against Metgud and Kalyani. In granting the United States’ motion, the district court entered judgment against the individual defendants, awarding damages and imposing the maximum penalty allowable under the False Claims Act.

The case arose from a contract in which Shubhada Industries agreed to manufacture light assemblies for munitions vehicles for the Defense Logistics Agency. Instead of actually manufacturing those parts, Shubhada purchased them from a third party and charged the government a total purchase price of $73,842—which amounted to a 5,400 percent mark-up of the cost price, according to the court’s opinion. When the government questioned the cost, Metgud justified it by explaining that costs sometimes seem very high “to untrained eyes.”

Under the False Claims Act, a person who causes false or fraudulent claims to be submitted to the government for payment is liable for three times the government’s damages, plus civil penalties for each false claim. The court’s judgment consists of three times the amount the Defense Logistics Agency paid, plus a civil penalty of $11,000, which the court noted was “at the top of the statutory range.”

In imposing this maximum penalty, the court explained that Metgud and Kalyani did not disclose to the agency their purchase of the light assemblies from someone else. In addition, the court opined the individuals “have not been forthright or cooperative in the Government’s investigation of the claims alleged in the amended complaint,” and seemed to “shrug off” the investigation and the court proceeding.

 “Those who do business with the government must treat taxpayers fairly,” said U.S. Attorney McSwain. “This case demonstrates my Office’s commitment to holding accountable defense contractors and others who try to game the system for personal profit at the military’s expense.”             

The case is significant because the government, as the plaintiff and moving party at summary judgment, obtained a judgment on the merits and without a trial. It is also significant because the district court’s judgment was based in part on its conclusion that it could draw an adverse inference against the individual defendants who invoked their Fifth Amendment right against self-incrimination.

Assistant U.S. Attorney Michael S. Macko handled the case, which arose from an investigation led by the United States Department of Defense, Defense Criminal Investigative Service.

PHILADELPHIA – U.S. Attorney William M. McSwain announced today that a former assistant manager at Citizens Bank in South Philadelphia was charged, along with his wife, in connection with a bank fraud scheme.

Defendants Craig Green, 53, and Bridgette Green, 38, both of Philadelphia, Pennsylvania, were charged this week by indictment with one count of conspiracy to commit bank fraud, one count of bank fraud, one count of aggravated identity theft, and 26 counts of money laundering.

According to the indictment, Craig Green used his position at Citizens Bank to improperly access the bank account information of an unsuspecting Citizens Bank customer and created a second, fraudulent account in the name of that same customer. Thereafter, Craig Green allegedly transferred funds from the bank customer’s legitimate account into the fraudulent account he had created. The indictment alleges that Craig Green and Bridgette Green would write checks drawing from the fraudulent account to a co-conspirator, and the co-conspirator would then deposit the checks and provide the money to the defendants. As the indictment indicates, the Greens were able to fraudulently withdraw approximately $165,498 during this scheme. 

If convicted, the defendants face a maximum possible sentence of 557 years imprisonment and a $14,500,000 fine.

The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney K.T. Newton.                                                                             

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

PHILADELPHIA – An indictment was unsealed today charging a Philadelphia man with bribing a Philadelphia Sheriff’s Office employee in exchange for inside information about Sheriff’s sales, announced U.S. Attorney William M. McSwain.

Behzad Sabagh was charged by indictment with one count of conspiracy to commit honest services wire fraud and six counts of honest services wire fraud. The indictment alleges that from September 2012 to August 2013, Sabagh and others paid bribes to a Philadelphia Sheriff’s Office employee in exchange for assistance with their business of purchasing properties at Sheriff’s sales.  Specifically, in exchange for bribes, the defendant received an updated Sheriff=s sale auction list which showed whether property sales had been stayed or postponed, allowing the defendant to avoid spending time evaluating properties that would not be sold.

“When the services of a public employee are purchased for personal gain, it is our duty to hold accountable those who attempted to game the system,” said U.S. Attorney McSwain.

If convicted, Sabagh faces a maximum possible sentence of 140 years’ imprisonment, 3 years of supervised release, and a $1,750,000 fine.

The case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service - Criminal Investigation Division, and is being prosecuted by Assistant United States Attorneys Sarah Grieb and Christopher Diviny.

“Far too often in this country, we as a nation have grieved the brutal murders of innocent people as a result of mass shootings and terrorism. Americans should be safe from such terror, no matter who or where they are. Studying in school or going to work, worshiping at church or cheering for friends at a marathon, relaxing at a movie theater or enjoying an evening at a night club – all of these activities should be safe-havens for every American. But as we know, places like these have turned into horrific crime scenes over the past few years where innocent lives have been lost. One more mass shooting is one too many.

Law enforcement and the U.S. Attorney’s Office in the Eastern District of Pennsylvania take seriously every threat of gun violence in our community and will do everything in our power to prevent tragedy from occurring. The federal complaint charging An-Tso Sun (a/k/a “Edward”) shows that we are doing just that. Mr. Sun may have said he was “just kidding” after he made the threat, but his alleged threat is no laughing matter. Regardless of race, gender, or immigration status, if an individual threatens to “shoot up” a school, or any other location, law enforcement will act swiftly upon that threat to ensure the safety of our community. I would also like to point out that if Sun is convicted of the current charge against him – possessing ammunition while being in the United States on a nonimmigrant visa – this is an aggravated felony that will operate as a permanent bar to his reentry into this country.

I want to take this opportunity to thank the hard-working and dedicated law enforcement personnel and prosecutors who responded so quickly in this matter. Thank you to the involved school officials, the Upper Darby Police Department, Delaware County District Attorney Katayoun M. Copeland, and her team of prosecutors and investigators, including Deputy District Attorney Daniel McDevitt, and our partners at the Department of Homeland Security, Homeland Security Investigations, including Special Agent in Charge Marlon V. Miller, Assistant Special Agent in Charge Jamie Holt, and Special Agent Zachary Kuzowsky, who helped avert a potential tragedy. And thank you to First Assistant U.S. Attorney Jennifer Arbittier Williams, Acting Chief of National Security Tay Aspinwall, and Assistant U.S. Attorney Sarah Wolfe for prosecuting this case on behalf of the United States Attorney’s Office.

To the student who heard the alleged threat and reported the incident to school officials – thank you. Thank you for being a good citizen and reporting it. It cannot be said too often: if you see something or hear something, you need to say something. Countless incidents have been averted because of vigilant people like you.

Finally, I would like to address parents, guardians, and all other adults who are responsible for children in their lives. It is your responsibility to know what your children are up to. No child should have access to firearms or other dangerous weapons without their parents’ or guardians’ knowledge. No child should be amassing an arsenal under the nose of the adults in their lives without the adults knowing about it. And when the adults know about it, they should do something about it. Ask questions. Go into your children’s bedrooms and look around. Pay attention to their online behavior and social media accounts. Wake up and do your job. Being a responsible parent means that your children’s business is your business.

We have a sacred duty, not only to our own children, but to all children in our community to make sure that they remain safe. To make sure that they can enjoy being children without fear or threat of violence. Thus, I am putting all parents and guardians in our community on notice. Law enforcement is not the first line of defense in these matters – you are. I ask that you take that responsibility seriously. Our children’s lives depend on it. And if you don’t fulfill that responsibility and then tragedy strikes, I will do everything in my power to hold you personally responsible, when the law allows it.” 

PHILADELPHIA – U.S. Attorney William M. McSwain announced that Philadelphia lawyer Devon Edward Sanders, 48, of Glenside, was sentenced on June 4 to 84 months in federal prison for downloading and possessing more than 94,000 images and videos of child pornography.

Chief U.S. District Judge Lawrence F. Stengel called the defendant’s collection “massive” and described the images and videos of children being sexually assaulted “dehumanizing, horrendous, and disgusting.” In rejecting the defendant’s request for probation, the court ruled that a significant sentence of incarceration was warranted based on the defendant’s “disturbing” crimes over a 10-year period. The court further ruled that a restitution hearing for the 25 victims seeking mandatory restitution will be held within the next 90 days.

“We agree wholeheartedly with Chief Judge Stengel’s assessment,” said U.S. Attorney McSwain. “By possessing these horrific images, this defendant victimized innocent children for more than a decade. A significant prison term was not only warranted but necessary.”

In addition to the term of imprisonment, the court imposed a 10-year term of supervised release and ordered that the defendant undergo a sex offender evaluation and treatment after his release from federal prison. 

The case was investigated by Department of Homeland Security and was prosecuted by Assistant United States Attorney Michelle Rotella.

PHILADELPHIA – U.S. Attorney William M. McSwain announced that retired Philadelphia Police Officer Victor Gates was found guilty today by a federal jury of honest services mail fraud conspiracy, honest services mail fraud, and making false statements. The jury deliberated for less than two hours before finding the defendant guilty. 

Gates bribed his friend Patrick Pelosi, a Philadelphia Police detective, to misuse his official position and access a law enforcement database of stolen cars in exchange for corrupt monthly payments.

Gates owned a company called Auto Recovery Services LLC, and one of his clients was Avis. Gates would have Pelosi remove certain stolen cars from the National Crime Information Center database so that Avis could rent them out to its customers. The defendant initially lied to police by denying that he made payments of any kind to Pelosi, although he later stated that he had made payments for “help” with the actual physical work of locating cars. Pelosi previously pled guilty and resigned from the Philadelphia Police Department in January 2017.

Between May 2008 and April 2013, Gates mailed a $300.00 check on a monthly basis to Pelosi’s home. Those payments increased to $400.00 per month between May 2013 and October 2014.

“This was a long-running, corrupt money-making scheme that is all the more egregious because the defendant has a law enforcement background,” said U.S. Attorney McSwain. “I want to thank the jury for its swift condemnation of Gates’ actions.”

This case was investigated by the Federal Bureau of Investigation and the Philadelphia Police Department, Internal Affairs Division, and is being prosecuted by Assistant U.S. Attorney Eric Gibson.

PHILADELPHIA – U.S. Attorney William M. McSwain announced today that a Taiwanese teenager accused of threatening an attack on a high school in Upper Darby, Pennsylvania has been charged federally.

An-Tso Sun (a/k/a “Edward”), 18, was charged yesterday by federal complaint with possessing ammunition while being in the United States on a nonimmigrant visa, which is a felony under federal law.

Sun is a Taiwanese national who came to the United States to live with an American host family and study at a high school in Upper Darby, Pennsylvania. According to the complaint, on or about March 26, 2018, Sun told another student (identified in the Complaint as “Student 1”), “Hey, don’t come to school on May 1st . . . I’m going to come here armed and shoot up the school. Just kidding.”

“When someone makes an alleged threat of this kind, law enforcement must take it seriously and investigate all leads,” U.S. Attorney McSwain said. “Law enforcement is committed to doing everything in our power to stop an attack before it happens. We must keep our children and our community safe from harm.” 

Student 1 reported the incident to school officials, who then alerted law enforcement.  According to the complaint, after the report of the threat, school officials and the Upper Darby Police called Sun’s host family to inform them of the alleged threat. Thereafter, Sun’s host-mother told police that she hired an attorney for Sun, returned home from work, and removed numerous items from Sun’s bedroom, placing them into a black duffel bag. She then allegedly brought this duffel bag to the attorney she had spoken with earlier in the day. According to the complaint, the duffel bag was later given to law enforcement and was found to contain the following:

• • One semiautomatic pistol, comprised of a Glock 19 9mm upper component (slide, recoil spring, and barrel) bearing serial number BESE280, and a Polymer80 brand lower component (frame) with no serial number;
  • 44 rounds of 9mm Aguila ammunition;
  • 615 rounds of 9mm Blazer Brass ammunition;
  • 225 rounds of 12 gauge Federal shotgun ammunition;
  • 280 rounds of 5.56mm IMI Systems ammunition; and
  • 423 rounds of 7.62 x 39mm TulAmmo ammunition.

Upper Darby Police officers also executed a search warrant at Sun’s residence and seized from Sun’s bedroom: 20 rounds of 9mm Blazer Brass ammunition; one ballistic suit, including a vest, jacket and pants; one cross bow; seven arrows; and various firearm accessories and shooting equipment. Sun has been in custody in Delaware County since his arrest by Upper Darby police in March.

If convicted, the defendant faces a maximum possible sentence of ten years’ imprisonment, a $250,000 fine, and three years’ supervised release.

“Thanks to the tremendous work of our local, state, and federal partners, a potential school tragedy was prevented,” said Special Agent in Charge Marlon V. Miller, Homeland Security Investigations Philadelphia Field Office. “Homeland Security Investigations will continue to support all of our law enforcement partners to ensure the safety and security of our communities.”

The case was investigated by Homeland Security Investigations, the Upper Darby Police Department and the Delaware County District Attorney’s Office, and is being prosecuted by Assistant United States Attorney Sarah M. Wolfe.

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

PHILADELPHIA – U.S. Attorney William M. McSwain announced that his office secured a life sentence today in a case involving a Delaware County man convicted of murder through the use of a firearm and conspiracy to distribute oxycodone. Anthony Vetri, 30, of Essington, was sentenced by U.S. District Judge Gerald J. Pappert. Vetri and Michael Vandergrift, 31, of Chester, were convicted of conspiracy to distribute oxycodone from 2008 until June 4, 2013. During the conspiracy, Vetri obtained large sums of oxycodone from a registered pharmacist, Mitesh Patel, who owned and operated three pharmacies in the greater Philadelphia area. Vetri then supplied Vandergrift with oxycodone, and both distributed the drugs throughout Delaware and Philadelphia Counties. During the course of the conspiracy, Vetri received and distributed in excess of 100,000 oxycodone tablets, earning him hundreds of thousands of dollars in drug proceeds.  

During the drug conspiracy, Patel illegally provided oxycodone to others, including his business partner, Gbolahan Olabode. Beginning in the fall of 2011, Vetri and Vandergrift conspired to eliminate Olabode as a competitor to boost Vetri and Vandergrift’s oxycodone supply from Patel. Vetri and Vandergrift ultimately decided to murder Olabode, and Vandergrift recruited Michael Mangold and Allen Carter to assist. On January 4, 2012, Vandergrift, Mangold, and Carter went to Olabode’s residence in Lansdowne, Pennsylvania and waited for Olabode to return home. When Olabode returned, Vandergrift and Mangold each used a firearm to fire 27 shots at Olabode as he carried groceries into his home. The assailants struck the victim 13 times in his head and body, causing Olabode’s death. Following Olabode’s murder, Vetri celebrated Olabode’s death and continued to illegally distribute oxycodone that he obtained from Patel. 

“The depravity of Vetri’s crimes knows no bounds. For years, the defendant poisoned his own community by fueling the opioid crisis in the Eastern District of Pennsylvania. Vetri’s distribution of over 100,000 oxycodone pills helped ruin people’s lives, and I have no doubt that many of Vetri’s customers continue to battle opioid abuse and addiction,” said U.S. Attorney McSwain. “The defendant is a violent drug trafficker who brought terror to the streets when he senselessly plotted the ambush and brutal murder of one of his rivals. Vetri has no respect for the law and no respect for human life. The defendant has never expressed remorse, nor has he accepted any responsibility for his actions. We are grateful that the Court held the defendant accountable for his violent and destructive conduct.”

Patel, Mangold, and Carter all previously pleaded guilty to charges for their respective involvement in drug distribution, the murder of Olabode, and other offenses, and are currently awaiting sentencing.

"For years, this defendant took advantage of addicts' misery, flooding the streets with pills and fueling the opioid crisis in our community," said Michael T. Harpster, Special Agent in Charge of the FBI's Philadelphia Division. "As he and his co-conspirator cashed in, they devised a brutal business plan: get more drugs and make more money by murdering the competition. Vetri is a danger to society on many levels, and this sentence is richly deserved." 

The case was investigated by the Federal Bureau of Investigation, the U.S. Drug Enforcement Administration, the Internal Revenue Service’s Criminal Investigation Division, the Philadelphia Police Department, the Organized Crime Drug Enforcement Task Force, the Lansdowne Police Department, and the Bureau of Alcohol, Tobacco, Firearms and Explosives. Assistant United States Attorneys Jonathan B. Ortiz and David. E. Troyer are prosecuting the case.

 

PHILADELPHIA – A Darby, PA tax preparer, who used the identities of disabled children and children in foster care to file false federal income tax returns, was sentenced in federal court today to 120 months in prison and $83,870 restitution, announced U.S. Attorney William M. McSwain. Musa Turay, 44, was sentenced by U.S. District Judge Harvey Bartle III.

Turay was a partner at Medmans Financial Services, a tax preparation business which operated two offices in Philadelphia. Turay and defendant Mohamed Mansaray, the other partner of the illegal business, ran the tax preparation business at 1869 S. 65th Street in Philadelphia.

Turay conspired to defraud the Internal Revenue Service by falsifying information on income tax returns to generate fraudulent refunds. The defendant prepared and filed federal income tax returns for clients of his tax preparation business. These returns included intentional false deductions, fake credits, and fictitious dependents using the names and Social Security numbers of children who were unrelated to the taxpayers, some of whom were in the foster care system.

Turay prepared over 1,000 fraudulent tax returns, and the IRS estimated that the loss caused by the returns prepared by the defendant was approximately $8,000,000. The defendant also falsified his own personal income tax returns by falsely adding dependents to the returns. Additionally, he fled the country after the government filed a motion to revoke his bail. The defendant absconded for nine months, until he was ultimately apprehended and is currently being held in jail.

“As U.S. Supreme Court Justice Oliver Wendell Holmes, Jr., noted, ‘Taxes are what we pay for civilized society,’” said U.S. Attorney McSwain. “Our tax laws are in place for a reason. When they are ignored, especially to this extent, we all lose. The defendant not only violated the tax laws, but he victimized innocent children by using their information to further his criminal scheme. This was a long-running conspiracy, and our investigators and prosecutors were determined to ensure that the defendant was held accountable for his actions. This sentence should send a message to anyone who thinks he can flout the law and target vulnerable victims without consequence.”

Turay is the last of 11 defendants prosecuted in this investigation to be sentenced for their roles in the preparation of thousands of false tax returns. The total loss to the government caused by all the tax preparers who worked at Medmans Financial Services was more than $30,000,000. The harm done to the children who were the victims of the tax fraud, however, cannot be quantified. These children will forever be at risk for the improper use of their identity information. Many of the parents and legal guardians of the children who were victimized in this case found themselves unable to file their own tax returns and claim their own children as dependents, because their children already had been falsely claimed as dependents on fraudulent returns.

“Today's sentence exemplifies IRS Special Agents' intense focus on the rigorous pursuit of identity theft and refund fraud,” said IRS Criminal Investigation Special Agent in Charge Guy Ficco. “Musa Turay and his co-conspirators perpetuated an elaborate scheme driven by insatiable greed and a blatant disregard for the tremendous damage inflicted on innocent victims. Be assured that IRS Criminal Investigation, together with our partners at the U.S. Attorney's Office, will hold those who engage in similar behavior fully accountable.”

The case was investigated by the Internal Revenue Service Criminal Investigation, the City of Philadelphia Office of Inspector General, and the Social Security Administration Office of Inspector General Office of Investigations. It is being prosecuted by Assistant United States Attorney Frank Costello.

 

PHILADELPHIA – A Coatesville, PA man was charged today in connection with a scheme to over-redeem gift cards, U.S. Attorney William M. McSwain announced.

Chad Douglas Broudy, 23, was charged by criminal information with wire fraud.

The information alleges Broudy defrauded an internet e-commerce company by exploiting a software glitch that permitted repeated uses of the same gift card. The information alleges that between October 29, 2016, and January 10, 2017, Broudy intentionally conducted approximately 1100 fraudulent transactions triggering this glitch, and in the process over-redeemed approximately $320,582 from the company’s gift cards.

“The defendant had a choice. He could have reported the glitch. But he chose greed and crime over honesty. He took full advantage of the glitch and exploited it not once or twice, but more than 1100 times, obtaining more than 3,000 items through fraud.”  

If convicted the defendant faces a maximum possible sentence of 40 years imprisonment, 3 years of supervised release, a fine of $500,000, and full restitution.

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

                                                                             

PHILADELPHIA – A West Chester University student has been charged with transporting, receiving and possessing child pornography, announced U.S. Attorney William M. McSwain. The defendant was arrested this morning

Ryan Davis, 21, of Thornbury, PA, formerly a resident of Glen Mills, was charged by indictment May 31 with transporting, receiving and possessing a collection of more than 600 images and videos of children being sexually assaulted and depicted in sexually explicit positions on various dates in 2016 and 2017. The indictment was unsealed today.

The charges arose out of an investigation into Davis’ online criminal activities involving his use of his Dropbox and other online accounts to sexually exploit children.

“Child exploitation is a horrendous crime, and we have to do everything in our power to stop it,” said U.S. Attorney McSwain. “That’s why these cases are a priority, as is ensuring that the offenders are held fully accountable.”  

If convicted, the defendant faces a maximum possible sentence of 60 years’ incarceration, which includes a 5-year mandatory minimum term of imprisonment, five years up to a lifetime of supervised release, and $750,000 in fines.

This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.

The case was investigated by the Federal Bureau of Investigation and the Delaware County District Attorney’s Office, and is being prosecuted by Assistant United States Attorney Michelle Rotella.                                                                             

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

Alison Kehner, who once clerked alongside U.S. Attorney McSwain for the Honorable Marjorie O. Rendell of the U.S. Court of Appeals for the Third Circuit, has joined the Office as Counsel to the U.S. Attorney. Kehner will report directly to the U.S. Attorney and will lead the Office’s effort to disseminate written material to the media and public. Kehner will also advise U.S. Attorney McSwain in a variety of areas and will be doing criminal case work.

“I am privileged to join the ranks of the dedicated and talented public servants in the U.S. Attorney’s Office for the Eastern District of Pennsylvania,” said Kehner. “The threats to our community are many, and I share U.S. Attorney McSwain’s commitment to always seeking justice for the people of the Eastern District.”

Most recently, Kehner was a senior lecturer in legal practice skills at the University of Pennsylvania. Prior to that, she was an assistant professor of legal methods at Widener University. Kehner has also served as a litigation associate at Dechert LLP.  Prior to her clerkship for Judge Rendell, she clerked for the Honorable Morton I. Greenberg of the U.S. Court of Appeals for the Third Circuit, and for the Honorable Mary Cooper of the District of New Jersey. She graduated first in her class from Villanova University School of Law and received her undergraduate degree from the University of Delaware.

U.S. Attorney McSwain has also welcomed Clare Pozos back to the Office. Pozos, who has previously served as an Assistant U.S. Attorney in both Philadelphia and Washington D.C., will now serve as Senior Advisor to the U.S. Attorney. Pozos will advise the U.S. Attorney on new office initiatives and focus on strengthening Office relationships with law enforcement and community partners. Pozos will also assist the U.S. Attorney in his communications with the public and the media.  In addition to her strategic role, she will also prosecute cases for the Criminal Division. 

“The U.S. Attorney’s Office in the Eastern District of Pennsylvania is a national leader within the Department of Justice,” said Pozos. “From the devastating effects of the opioid crisis to the debilitating toll of public corruption, this Office is at the forefront of the most pressing issues facing our country. It is an honor to work with U.S. Attorney Bill McSwain, this entire Office, and our law enforcement partners to confront these challenges, and to protect our community here in the Eastern District.”

Pozos graduated from the University of Pennsylvania Law School after earning her undergraduate degree from Harvard College. After law school, Pozos clerked for the Honorable Michael M. Baylson of the Eastern District of Pennsylvania, and worked at Skadden, Arps, Slate, Meagher & Flom in Washington D.C. 

Kehner and Pozos now join the other members of the executive management team: First Assistant U.S. Attorney Jennifer Williams, Deputy U.S. Attorney Louis Lappen, Criminal Chief Denise Wolf and Civil Chief Gregory David.

"I'm delighted that Clare and Alison have joined my leadership team,” said U.S. Attorney McSwain. “I have known them both for over a decade, and they are immensely talented lawyers with excellent judgment. They share my commitment to public safety, and I look forward to working with them on a daily basis. They will strengthen our Office and help us to better serve the citizens of this District."  

PHILADELPHIA – Terrell Hampton who, along with his father and several other family members, defrauded the City of Philadelphia, the Commonwealth of Pennsylvania, and innocent owners and purchasers of Philadelphia real estate, was sentenced to 119 months in prison today, announced U.S. Attorney William M. McSwain.

Hampton, 37, along with his father Kenneth and other family members, stole vacant homes in Philadelphia that belonged to people who could not afford to defend their properties. Kenneth Hampton was convicted and sentenced to 200 months in prison in November.

At the direction of his father, who was in prison at the time, Terrell looked for vacant properties to target, created and filed fraudulent deeds, sought buyers for the stolen properties, and kept Kenneth apprised of scheme developments. They communicated through phone calls, emails, and letters, as well as through Kenneth’s fiancée, co-conspirator Roxanne Mason.

The participants in the scheme moved into the stolen properties under the cover of fake leases that purported to grant them the right to occupancy.  They then found ways to profit from the stolen properties, either by selling the homes to good faith purchasers, by saddling them with debt, or by taking advantage of government programs designed to aid legitimate homeowners.                                                                                     

“This defendant stole from people who didn’t have the resources to fight back, often resulting in victim battling against victim, homeowner against good faith purchaser,” said U.S. Attorney McSwain. “He lived up to the low example set by his father, and I am proud that the talented case team has put both of them behind bars.”

The case was investigated by the United States Secret Service, Department of Homeland Security - Office of the Inspector General, Federal Bureau of Investigation, and the Office of the Inspector General, City of Philadelphia.  The case was prosecuted by Assistant United States Attorneys Paul G. Shapiro and Sarah M. Wolfe

PHILADELPHIA – The owners of I&L Express Pharmacy in Philadelphia have agreed to pay millions to resolve a False Claims Act case against them, U.S. Attorney William M. McSwain announced today.

Irina Minkovich and Yelena Babchinetskya have agreed to pay $3.2 million to the federal government to resolve allegations that they violated the False Claims Act by billing Medicare for prescription medications that were not actually dispensed during the period January 1, 2009, through December 31, 2015.

These medications included such drugs as Lidoderm, Advair Diskus, Nexium, Plavix, Solaraze, Zeita, Ranexa, Celebrex, Spiriva Handihaler, Nasonex, Lovaza, Singulair, Prevacid, Valsartan, Aricept, and Lidocaine.  I&L Express Pharmacy, Irina Minkovich, who is also I&L Express’ pharmacist, and Yelena Babchinetskya also agreed with the Department of Health and Human Services, Office of the Inspector General to enter into an integrity agreement.  The integrity agreement requires them to undertake substantial compliance obligations and to contract with an Independent Review Organization that will conduct quarterly third-party audits of their Medicare and Medicaid claims and drug inventory.

“Pharmacies and pharmacists have a responsibility to serve as gatekeepers of a closed system of prescription drug distribution.  That responsibility was abused for profit here,” said U.S. Attorney McSwain. “Taxpayer dollars should be spent on needed medications, not wasted on fraud and abuse.”

“Pharmacies are an integral partner in patient care, and they are expected to act with integrity,” said Maureen Dixon, Special Agent in Charge of the Philadelphia Regional Office of the Department of Health and Human Services, Office of the Inspector General. “We take allegations of pharmacy fraud seriously, as evidenced by today’s $3.2 million settlement, and we will continue to work with our partners to ensure taxpayer dollars are spent in an appropriate manner.”

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

This case was investigated by the U.S. Department of Health and Human Services Office of the Inspector General.  It was handled by Civil Chief Gregory B. David and Auditor George Niedzwicki.     

PHILADELPHIA – An indictment was unsealed May 29 charging Thomas Harris, 60, with one count of bank fraud, announced United States Attorney William M. McSwain.

The indictment alleges that from September to October of 2016, Harris defrauded Fulton Bank in Harrisburg, Pennsylvania, by opening a bank account, depositing fraudulent checks, and withdrawing funds from the account.

If convicted the defendant faces a maximum possible sentence of 30 years’ imprisonment.

The case was investigated by the Postal Inspection Service and is being prosecuted by Assistant United States Attorney Laurie Magid.

                                                                             

PHILADELPHIA – Francisco Santos, also known as “F.S.S.,” “A.C.M.,” and “Luis Colon,” was charged by indictment May 29 with making a false statement in an application for a passport, and with making a false statement to a federal agent, announced United States Attorney William M. McSwain.  

The indictment alleges that on May 16, 2017, Santos, of Bethlehem, applied for a passport in Northampton County, Pennsylvania, in the name of A.C.M.  The indictment also alleges that on August 21, 2017, in Bethlehem, Pennsylvania, Santos made a false statement to a Special Agent of the Department of State.

If convicted, the defendant faces a maximum statutory sentence of 15 years’ imprisonment.

The case was investigated by the Department of State and is being prosecuted by Assistant United States Attorney Laurie Magid.

“We see few cases in which a defendant has victimized so many that the number of those impacted is too high to count. This is one such case.

Wheeler K. Neff used his law license to help clients prey on the financial desperation of people all across the country. He helped so-called payday lenders evade the law and, in the process, collected hundreds of millions of dollars in debt on loans with interest rates that would make Tony Soprano blush – typically exceeding 780 percent.

The defendant drafted sham contracts for payday lenders like Charles M. Hallinan and Adrian Rubin – each of whom were convicted and are awaiting sentencing. These contracts were designed to give the false impression that Hallinan and Rubin’s companies were owned by Indian tribes that could claim ‘sovereign immunity’ from laws the defendants wanted to evade.

As an attorney, Mr. Neff should realize that a civilized society requires obedience to the law, including those laws he didn’t happen to like.   

Neff drafted these contracts to help clients collect unlawful debt for as long as possible without getting caught.  In return, Neff received hundreds of thousands of dollars a year in legal fees.

The defendant’s schemes pushed the limits of creative deception.

For example, he helped Hallinan defraud some 1,400 people who had brought a class action lawsuit in Indiana against one of Hallinan’s companies, Apex 1 Processing, Inc.  Fearing that Hallinan could face personal exposure of $8 to $10 million if the plaintiffs could prove that Hallinan owned Apex 1, Neff conspired with Hallinan to make it appear that Apex 1 had no assets, employees, or officers, and was owned by an Indian chief living in Canada in order to entice the plaintiffs to accept a discounted settlement on their claims.  To further this scheme, Neff told Hallinan to change his tax returns and retroactively transfer business activity from Apex 1 to another of Hallinan’s companies.  Neff also directed people to transfer all documents relating to Apex 1 to tribal lands in Canada, where they would never be found by the plaintiffs.

The defendant preyed on the vulnerable -- those who were desperate and struggling. Consider, for example, the story of one of Neff’s victims,  Dawn Schmitt, the Nebraska school teacher who testified that she turned in desperation to payday loans after her abusive partner left her broke and without credit.  Schmitt testified that she wound up taking out about five payday loans, including one from a Hallinan company, and fully intended to pay them all back.  But she could not do so, despite her best efforts, because she was trapped in a cycle of debt caused by Neff and his co-conspirators.  As a result, she was forced to declare bankruptcy and move home to North Dakota. 

But rather than an apologize to Schmitt and his other victims, the defendant doubled down on the kind of treachery that helped collect more than $490 million in debt, between 2008 and 2013, from hundreds of thousands of customers, including residents of Pennsylvania, a state which prohibits payday loans.

Over four days of trial testimony, Neff lied over and over again under oath. But to its great credit, the jury saw through Neff’s perjury. We hope that the verdict and today’s sentencing of 8 years in a federal prison provide some measure of justice to the victims.

And it was only through the hard work and dedication of our partners with the FBI, United States Postal Inspection Service, and Internal Revenue Service Criminal Investigations that we were able to unravel this complicated scheme and bring this defendant, and others charged in connection with this case, to justice. All involved in this exhaustive investigation should be congratulated.

And I would especially like to thank our trial team of Assistant United States Attorneys Mark B. Dubnoff and James Petkun who not only expertly and successfully prosecuted a very complex case, but who also saw and brought to light, in human terms, the damage the defendant has done to the lives of those who reached out in desperation, and found only more heartache.”

PHILADELPHIA – A Philadelphia woman was charged May 24 by indictment with five counts of wire fraud, one count of theft of government funds, and one count of social security fraud, announced United States Attorney William M. McSwain.  

According to the indictment[1], Cassandra Boone, 67, created a second identity to continue working while she simultaneously received disability benefits under her real name.  The defendant’s alleged actions resulted in government losses totaling approximately $121,690.   

“When someone defrauds the system, we’re all victims,” said U.S. Attorney McSwain. “We have to preserve the integrity of our Social Security system, and one way we do that is stopping those who are gaming the system for their own benefit.”       

If convicted, defendant Cassandra Boone faces a maximum sentence of 115 years’ incarceration, a period of supervised release, full restitution to the government, and a fine. 

The case was investigated by the Social Security Administration, Office of Inspector General, and the Pennsylvania State Police, and is being prosecuted by Special Assistant United States Attorney Christopher E. Parisi.

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[1] An indictment is an accusation.  A defendant is presumed innocent unless and until proven guilty. 

PHILADELPHIA – Julian Washington, 71, of Philadelphia, Pennsylvania, was charged May 24 by superseding indictment with four counts of wire fraud, one count of theft of government funds, and one count of social security fraud, announced United States Attorney William M. McSwain. 

According to the superseding indictment[1], the defendant used multiple identities to apply for Social Security benefits.  The defendant’s alleged actions resulted in a loss to the government of approximately $20,310.             

If convicted, defendant Julian Washington faces a maximum sentence of 95 years’ incarceration, a period of supervised release, full restitution to the government, and a fine. 

The case was investigated by the Social Security Administration, Office of Inspector General, and the Pennsylvania State Police, and is being prosecuted by Special Assistant United States Attorney Christopher E. Parisi.

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[1] An indictment is an accusation.  A defendant is presumed innocent unless and until proven guilty. 

PHILADELPHIA – A Philadelphia man was charged May 24 in connection with armed robberies of convenience stories, announced U.S. Attorney William M. McSwain.

Tyrone Evans, 24, of Philadelphia, Pennsylvania, was charged by indictment with three counts of Hobbs Act robbery and three counts of the use and carrying of a firearm during a crime of violence.  According to the indictment[1], the defendant, along with codefendants who were charged separately, committed three gunpoint robberies of convenience stores in Philadelphia in June of 2017. 

“We work very hard to reduce violent crimes like these,” said U.S. Attorney McSwain. “And we have to make sure that those who use firearms when committing crimes pay a severe penalty. The safety of our communities depends on it.”

If convicted, defendant Tyrone Evans faces a maximum sentence of life imprisonment, including a mandatory minimum sentence of 57 years, as well as full restitution. 

This case was brought as part of Project Safe Neighborhoods (PSN), a program that has been historically successful in bringing together all levels of law enforcement to reduce violent crime and make our neighborhoods safer for everyone.  Attorney General Jeff Sessions has made turning the tide of rising violent crime in America a top priority.  In October 2017, as part of a series of actions to address this crime trend, Attorney General Sessions announced the reinvigoration of PSN and directed all U.S. Attorney’s Offices to develop a district crime reduction strategy that incorporates the lessons learned since PSN launched in 2001.

The case was investigated by the Philadelphia Police Department and Federal Bureau of Investigation, and is being prosecuted by Special Assistant United States Attorney Christopher E. Parisi.

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[1] An indictment is an accusation.  A defendant is presumed innocent unless and until proven guilty. 

PHILADELPHIA – A Delaware attorney who spent nearly a decade helping clients collect hundreds of millions of dollars in illegal payday loans was sentenced Friday to eight years in federal prison, fined $50,000 and ordered to forfeit more than $356,000 in criminal proceeds

Wheeler K. Neff, 69, of Wilmington, was convicted in November of racketeering, conspiracy, and fraud charges.  A jury found that Neff and his co-defendant, Charles M. Hallinan, 77, of Villanova, conspired to collect more than $490 million in debt from small short-term loans that were commonly known as “payday loans,” because the customers were supposed to pay them back with their next paychecks. 

U.S. District Judge Eduardo C. Robreno ordered Neff to report to prison in 45 days.  Hallinan is scheduled to be sentenced on July 6, 2018.

Between 1997 and 2013, Hallinan owned, operated, and financed numerous companies that issued and collected debt from loans that had annual interest rates typically exceeding 780 percent.  In Pennsylvania, it is a crime to charge more than 25 percent annual interest on such loans, and more than a dozen other states have interest rate limits of 36 percent or less.

“Payday loans prey on those who can least afford it. That’s why they are illegal in Pennsylvania and many other states,” said U.S. Attorney William M. McSwain. “This defendant has never shown a hint of remorse for his actions nor sympathy for his victims, and during trial he told one lie after another. Perhaps a sentence like this will give him time to seriously consider the lives he has impacted.”

Neff drafted sham contracts designed to give the false impression that Hallinan’s companies were owned by Indian tribes that could claim “sovereign immunity” from laws they did not like.  In 2011 and 2012, Neff engaged in a similar scheme with another payday lender, Adrian Rubin, 61, of Jenkintown.  In return, Neff received hundreds of thousands of dollars a year in legal fees. 

“As an attorney, Mr. Neff should realize that a civilized society requires obedience to the law, including those laws he didn’t happen to like,” said U.S. Attorney McSwain.  

Neff also helped Hallinan defraud nearly 1,400 people who had brought a class action lawsuit in Indiana against one of Hallinan’s companies. Neff conspired with Hallinan to make it appear that his company had no assets, employees, or officers, and was owned by an Indian chief living in Canada in order to entice the plaintiffs to accept a discounted settlement on their claims. 

The case was investigated by the Federal Bureau of Investigation, the United States Postal Inspection Service, and Internal Revenue Service Criminal Investigations. It is being prosecuted by Assistant United States Attorneys Mark B. Dubnoff and James Petkun.

PHILADELPHIA – A federal jury found Dean Rossi, 49, of Warrington, Pennsylvania, guilty yesterday of bank, mail and loan fraud in connection with a mortgage scheme, announced U.S. Attorney William M. McSwain.

Rossi, who owned numerous low-income properties throughout the Philadelphia area, misappropriated more than $643,000 from real estate closings. Specifically, after obtaining bank loans to purchase or refinance residential properties, Rossi teamed up with corrupt title/closing agents to divert a substantial portion of the loan proceeds, and then he pocketed cash from the settlements which should have been used to pay off prior mortgages and tax liens. In addition, to prevent the scheme from being detected, Rossi continued to cause payments to be made on the prior existing mortgages years after those loans were supposed to have been paid in full.

“Our investigators and trial team did a phenomenal job of following a trail of evidence that goes back more than a decade,” said U.S. Attorney McSwain. “The defendant went to great lengths to cover his tracks, but due to the hard work of our agents and prosecutors, his long-running scheme was exposed.”          

The defendant faces a maximum possible sentence of 120 years’ imprisonment, five years of supervised release, and a $4 million fine.

The case was investigated by the U.S. Postal Inspection Service and the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorney Joel Goldstein.

PHILADELPHIA – Two men, one from Georgia, the other from California, were charged today with sex trafficking and related crimes, announced U.S. Attorney William M. McSwain.

Kashamba John, 30, of Atlanta, and Tyler Robert Bachtel, 34, of Montclair, California, were charged today by indictment with one count of sex trafficking by means of force, threats of force, fraud and coercion (Count One). John was additionally charged with one count of transporting an individual in interstate commerce with the intent that the individual engage in prostitution (Count Two).

Bachtel remains at large. Anyone with information on his whereabouts should contact local law enforcement or the ICE tip line at 866-DHS-2-ICE.

“The victims of sex trafficking pay a price that lasts a lifetime,” said U.S. Attorney McSwain. “We have to do everything possible to find the offenders and bring them to justice.”

If convicted of sex trafficking, each defendant faces a mandatory minimum term of 15 years’ imprisonment up to a possible sentence of life imprisonment, a minimum of five years up to lifetime of supervised release, and a $250,000 fine.  In addition, on Count Two, John faces a maximum of 10 years’ imprisonment as well as up to three years supervised release and a $250,000 fine.

The case was investigated by the Department of Homeland Security, Immigration and Customs Enforcement - Homeland Security Investigations, the Pennsylvania State Police, and the Office of the Attorney General for the Commonwealth of Pennsylvania, and is being prosecuted by Assistant United States Attorneys Melanie Babb Wilmoth and Michelle Morgan.

An Indictment, Information or Criminal Complaint is an accusation.  A defendant is presumed

innocent unless and until proven guilty.

PHILADELPHIA – A Reading man, and sixth member of a Reading area bank fraud ring, was charged with fraud today, announced U.S. Attorney William M. McSwain.

A criminal information[1] was filed charging, Angel Ocasio, Jr., 20, of Reading, Pennsylvania, with one count of bank fraud. Ocasio is alleged to be a member of a bank fraud ring operated by Steven Ronald Randall of Philadelphia.

Randall previously pled guilty on March 15, 2018 to one count of bank fraud and five counts of aggravated identity theft before U.S. District Judge Joseph F. Leeson, Jr. As part of his guilty plea Randall admitted that he was a leader of a scheme to defraud First National Bank and used persons to open bank accounts and obtain ATM debit cards so that their bank accounts could be used to deposit fraudulent checks and withdraw cash before FNB determined that the checks were fraudulent. Randall had also admitted that FNB sustained actual losses in excess of $76,519, with intended losses of in excess of $115,782, as a result of this scheme. Randall had also admitted that he transferred funds from the accounts opened by his co-schemers to inmates incarcerated within the Pennsylvania Department of Corrections.

The information filed today alleges that Ocasio opened an account at FNB that he knew would be used to deposit fraudulent checks and withdraw cash before the bank discovered that the checks were fraudulent, in return for a share of the fraud proceeds.

“This was a sophisticated scheme that took excellent investigative work to unravel,” said U.S. Attorney McSwain. “Punishing financial fraud – as well as identity theft – is and will continue to be a top priority of my office.”

Ocasio faces a maximum sentence of 30 years’ incarceration, a five-year period of supervised release, and a fine of $1,000,000.

Ocasio is the sixth member charged as part of this group. In addition to Ocasio and Randall, the other members of the bank fraud ring previously charged are Jaylen Jefferson, 19, of Reading, Dawson Thomas, 19, of Mohnton, Rebecca Ilie, 25, of Reading, and Linda Pacheco, 40, of Reading.

The case was investigated by the United States Postal Inspection Service, the Federal Bureau of Investigation, and the Cumru Township Police Department and is being prosecuted by Assistant United States Attorney Michael S. Lowe.

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[1]              An Indictment or Information is an accusation.  A defendant is presumed innocent unless and until proven guilty