Eastern District of Pennsylvania

PHILADELPHIA – A federal jury today convicted Chaka Fattah, Jr., 32, of Philadelphia, of 22 of 23 counts in connection with a scheme to defraud banks, the Internal Revenue Service, and the Philadelphia School District of hundreds of thousands of dollars.  U.S. District Court Judge Harvey Bartle III scheduled a sentencing hearing for February 2, 2015.  The defendant faces a substantial term of imprisonment, restitution to the IRS, fines, a special assessment, and supervised release.

Between 2005 and 2012, Fattah, Jr. made false statements to banks to obtain loans; made false statements to banks and the Small Business Administration to settle loans for less than what was owed; filed false federal income tax returns; failed to pay federal taxes; and stole from the Philadelphia School District, which had received federal funds for its operations.

 Fattah, Jr., obtained numerous business lines of credit through false and fraudulent statements to local banks and used the funds primarily for personal expenses - including car payments, gambling debts, restaurant and club expenses, utilities, clothing, electronics, retail purchases, charitable donations, jewelry, legal fees, and personal credit card expenses - rather than business expenses, as the loan terms required.  These false statements involved fictitious earnings information that Fattah, Jr., supplied for entrepreneurial companies which Fattah claimed he operated, including 259 Strategies, LLC (“259 Strategies”) and Chaka Fattah, Jr. & Associates.  Fattah, Jr., claimed that 259 Strategies provided educational consulting, diversity consulting & audit services, technical assistance, and community relations, and organizational development services to a select group of clients. He claimed that Chaka Fattah, Jr. & Associates performed research and consulting concerning the development of computer centers.

In 2011, Fattah, Jr., received a loan from United Bank for $50,000 intended for "working capital to support business operations."  Instead, he used the funds to make car payments, to pay down over $15,000 in personal credit card debt, and to pay in excess of $33,000 in gambling debts at area casinos.  The charges total approximately $206,000 in bank loans received through false misrepresentations or fraud.

Fattah, Jr., defaulted on several lines of credit and provided false information to two banks, to the United States Small Business Administration, which had insured the bank loans, and to a Small Business Administration investigator, to attempt to settle the debts for less than what was owed.  Fattah, Jr., falsely claimed that 259 Strategies was out of business at the time he was attempting to settle his debts in 2010, and that he was earning only $2,500 per month.  In fact, during 2010, Fattah, Jr.’s 259 Strategies was intact and, through this company, he was earning between $6,250 per month and approximately $37,500 per month.

Fattah, Jr., also stole funds supplied by the federal government to the Philadelphia School District, while acting as Chief Operating Officer of a Philadelphia company which provided educational services to "at risk" and other students through contracts with the school district.  Fattah, Jr. provided false expense information and inflated salary figures for teachers and administrative staff on budgets submitted to the school district, which made payments consistent with the budgets provided and concealed the theft of the funds from the school district.

For tax years 2005, 2006, and 2008 Fattah, Jr., filed false federal income tax returns and he failed to timely pay federal income tax of approximately $51,141 on reported income in excess of $150,000 during 2010.

The case was investigated by the FBI, IRS Criminal Investigation, and the U.S. Department of Education, with the cooperation of the Philadelphia School District’s Office of Inspector General.   It is being prosecuted by Assistant U.S. Attorney Paul L. Gray of the Eastern District of Pennsylvania and Trial Attorney Eric Gibson of the Criminal Division’s Public Integrity Section.

PHILADELPHIA – Charles Spencer, 81, of Philadelphia, PA, was charged today by information with mail fraud in connection with the theft of approximately $230,400 from an annuity, announced United States Attorney Zane David Memeger.

According to the information, Spencer became the guardian of his sister, V.R., and her affairs when V.R. became infirmed.  V.R. was receiving monthly payments of $1,600 from an annuity.  She died on January 22, 2001 but Spencer, it is alleged, did not inform Lincoln National Insurance Company (LNIC), which disbursed the annuity payments.  LNIC continued to send monthly annuity checks payable to V.R. which defendant Spencer allegedly received, countersigned, and deposited into his bank account.  It is alleged that Spencer received approximately 144 annuity checks, totaling approximately $230,400.       

If convicted the defendant faces a statutory maximum sentence of  20 years in prison, possible restitution, a fine of up to $250,000, up to three years of supervised release, and a $100 special assessment.

The case was investigated by United States Postal Inspection Service and is being prosecuted by Assistant United States Attorney Floyd J. Miller.

An Information is an accusation.  A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA - Harry Dallas, 54, of Philadelphia, PA, was charged today by indictment with two counts of bank robbery, announced United States Attorney Zane David Memeger.  According to the indictment, on September 16, 2015, Dallas robbed the Citizens Bank at 7327 Frankford Avenue and, on September 20, 2015, robbed the TD Bank at 6635 Frankford Avenue.  

If convicted of all charges, Dallas faces a statutory maximum sentence of 40 years in prison.

This case was investigated by the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorney Salvatore L. Astolfi.

An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA - Frank Menichini, 73, of Newtown Square, Pennsylvania, pleaded guilty today to a criminal information charging him with one count of falsifying records with the intent to obstruct an investigation by the United States Department of Transportation (“DOT”). U.S. District Court Judge Gerald J. Pappert scheduled a sentencing hearing for February 3, 2016.  The defendant faces a maximum sentence of 20 years in prison, up to three years of supervised release, a $250,000 fine and a $100 special assessment.

During his guilty plea, the defendant admitted that he controlled DVG Packaging, Inc. (“DVG”), which marketed and sold plastic bags that the defendant claimed had been tested and certified to meet a pressure test required by the DOT for transporting certain hazardous substances.  The defendant falsified a laboratory test report to make it appear as though the bags were certified, even though he knew that they were not.  When inspectors from the Pipeline and Hazardous Materials Safety Administration of the DOT requested papers related to the purported certification of the bags, the defendant provided them with the falsified test report.   

The case was investigated by the United States Department of Transportation Office of Inspector General, and is being prosecuted by Assistant United States Attorney Elizabeth Abrams.

PHILADELPHIA - The United States filed a civil fraud lawsuit today against Wilbert D. McKinzie, an Amtrak employee, of Chester, Pennsylvania, alleging that he submitted claims for sickness compensation to which he was not entitled, announced United States Attorney Zane David Memeger.  According to the complaint, McKinzie was working another job as a home health aide while submitting claims for sickness compensation from the United States Railroad Retirement Board.  McKinzie collected $9,517.60 that he was not eligible to receive.

The United States filed the lawsuit under the False Claims Act. 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 allegations against McKinzie are allegations only and not findings of liability.  To resolve the matter, McKinzie has agreed to enter into a consent judgment.

The allegations arose from an investigation led by the United States Railroad Retirement Board Office of Inspector General. The case was handled by Assistant United States Attorneys Richard M. Bernstein and Michael S. Macko.

Corderro Cody, 27, of Allentown, Pennsylvania, pleaded guilty today to charges arising from his operation of a sex trafficking enterprise that compelled multiple victims to prostitute for the defendant’s profit.  Cody pleaded guilty to conspiracy to commit sex trafficking by force, fraud or coercion, conspiracy to transport individuals both intrastate and interstate for the purpose of prostitution, one count of sex trafficking of a minor and 12 counts of sex trafficking by force, fraud and coercion.

According to documents filed in the case and evidence presented in court during the plea hearing, from 2009 until the time of his arrest in 2014, the defendant, conspiring at various times with others, used false promises to recruit his victims into relationships with him, then used psychological manipulation, addictive drugs, sexual assaults and brutal violence to control and coerce them for purposes of prostituting them for his profit.  Cody also denied a victim access to her child as another form of coercion and control.

As set forth in documents filed in the case, Cody recruited multiple women to prostitution, referring to his prostitution enterprise as the “program,” and advertised the women for commercial sex acts on Backpage.com.  Cody transported them both within Pensnylvania and to other states to prostitute, and he controlled and retained virtually all of the prostitution proceeds.  Cody also used physical force and violent beatings when the women did not adhere to the “program,” in order to maintain the women for continued commercial sexual acts at his direction.

“Human trafficking is a crime that deprives vulnerable individuals of their freedom and dignity,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Civil Rights Division.  “This defendant engaged in a concerted scheme of cruelty and brutality to compel and coerce his victims to sell their bodies for his profit.  This disregard for their humanity is an affront to our values as a nation, and the Civil Rights Division is deeply committed to bringing traffickers to justice to vindicate the rights and dignity of survivors of human trafficking in all its forms.”

“A dozen victims of this sex trafficker have the opportunity to rebuild their lives and countless other potential victims will no longer fall prey to his abuse,” said Special Agent in Charge John Kelleghan of U.S Immigration and Customs Enforcement-Homeland Security Investigations (ICE-HSI) in Philadelphia.  “This case is a result of the excellent relationship between HSI special agents and local police officers who continuously work together to root out this type of violent activity to keep communities safe."

U.S. District Court Judge Edward G. Smith of the Eastern District of Pennsylvania scheduled a sentencing hearing for Jan. 29, 2016.  Cody faces a mandatory minimum prison term of 15 years and a maximum of life, a fine of up to $3.75 million, a mandatory minimum of five years of supervised release and up to a lifetime of supervised release and a $1,500 special assessment.

The case was investigated by ICE-HSI and the Allentown Police Department.  The case is being prosecuted by Assistant U.S. Attorney Sherri A. Stephan of the Eastern District of Pennsylvania and Trial Attorney Anita Channapati of the Civil Rights Division’s Human Trafficking Prosecution Unit.  

PHILADELPHIA – A federal jury, yesterday, returned guilty verdicts against a Cherry Hill, NJ woman and her parents for a mortgage fraud scheme that stripped the equity from the homes of desperate homeowners facing foreclosure.   Silver Buckman, 37, of Cherry Hill, NJ, her parents, Vincent Foxworth, 70, and Cynthia Foxworth, 64, of Turnersville, NJ, were found guilty of bank fraud, wire fraud, and conspiracy to commit bank fraud and wire fraud.  Their scheme caused losses to mortgage lenders of approximately $3.8 million.  U.S. District Court Judge R. Barclay Surrick scheduled a sentencing hearing for January 29, 2016.

The defendants offered to help financially-vulnerable individuals save their homes from foreclosure or obtain money from the equity in their homes but, instead, defrauded the homeowners and mortgage lenders.  Buckman owned and operated Fresh Start Financial Services (“FSFS”), in Mount Laurel, NJ and was an employee of American Home Lending as well as a mortgage broker for American One Mortgage (“AOM”).  Her father is an experienced Realtor.

Between October 2006 and November 2009, Buckman and her co-defendants allegedly targeted financially vulnerable homeowners and represented to them that they could improve their credit, save their homes from foreclosure, or provide them with money through Buckman’s lease buyback program.  The homeowners were told that “investors” would be used to temporarily refinance their homes and that they could repurchase the homes in one year, or once they regained their financial footing.  The defendants also allegedly induced the homeowners into signing documents related to the sale and lease of their homes by their representations that the homeowners would remain on the title to their homes, that the equity from their homes would be placed into an individual escrow account in their names, and that new mortgages would be paid from the escrow accounts to establish their timely payment histories.

In order to carry out the scheme, Buckman recruited Vincent Foxworth and Cynthia Foxworth and others to be straw borrowers.  Buckman submitted false financial and employment information about the straw borrowers to mortgage lenders.  Once lenders agreed to fund the mortgage loans, Buckman prevented the homeowners from receiving the settlement proceeds and did not put money into escrow accounts for the homeowners.  Instead, the defendants distributed the proceeds amongst themselves.  Buckman used only a fraction of the homeowners’ monies toward the payment of the mortgages obtained by the straw borrowers for the homeowners’ homes and thereby caused the loans to go into default.

The defendants each face a potential advisory sentencing guideline range of approximately 87 to 108 months in prison plus restitution.

The case was investigated by the Federal Bureau of Investigation, the United States Postal Inspection Service and IRS Criminal Investigations.  It is being prosecuted by Assistant United States Attorney Anita Eve.

PHILADELPHIA - Corderro Cody, 28, of Allentown, PA, pleaded guilty today to charges related to his running of a sex trafficking operation.  Cody pleaded guilty to conspiracy to commit sex trafficking by force, fraud or coercion, 12 counts of sex trafficking, conspiracy to transport individuals across state lines for the purpose of prostitution, and one count of sex trafficking of a minor.   

Cody recruited women to work as prostitutes, referred to his prostitution business as the “program,” and advertised the women on Backpage.com.  The women were sometimes driven to other states and forced to perform sexual acts.  Cody recovered and kept most, if not all, of the money generated by the sexual acts, and used physical force in the form of beatings when the women did not adhere to the “program,” and to maintain the women performing commercial sexual acts.

United States District Court Judge Edward G. Smith scheduled a sentencing hearing for January 29, 2016.  Cody faces a mandatory minimum prison term of 15 years up to a maximum of life, a fine of up to $3.75 million, a mandatory minimum of five years of supervised release up to lifetime supervised release, and a $1,500 special assessment.

The case was investigated by Homeland Security Investigations and the Allentown Police Department. It is being prosecuted by Assistant United States Attorney Sherri A. Stephan, and Trial Attorney Anita Channapati of the Civil Rights Division of the Department of Justice.

PHILADELPHIA – Stephen Gregory Pettiway, 50, of Philadelphia, PA, was charged today by indictment with setting a fire on September 15, 2015, that damaged three properties in Philadelphia, announced United States Attorney Zane David Memeger. According to the indictment, Pettiway started a fire that caused damage to equipment and buildings that included Chancellor Apartments at 206 South 13th Street, a construction site at 208 South 13th Street owned by Maze Hospitality Group, and Gramercy Building at 210 South 13th Street. He is charged with one count of malicious damage by means of fire of a building used in interstate commerce.

If convicted the defendant faces a mandatory-minimum term of 60 months in prison with a possible guideline sentencing range of up to 71 months in prison without the possibility of parole, a fine of up to $250,000, a $100 special assessment, and up to three years of supervised release.

The case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Philadelphia Fire Department. It is being prosecuted by Assistant United States Attorneys José R. Arteaga and Thomas M. Zaleski.

PHILADELPHIA – Shawn LaSalle Harris, 37, of Norristown, PA, was charged today by Indictment with armed bank robbery and a weapons offense, announced United States Attorney Zane David Memeger.  According to the indictment, on June 3, 2015, Harris held up the Bank of America branch at 420 Plymouth Road, in Plymouth Meeting, PA. He allegedly brandished and discharged a .380 caliber Ruger handgun.

If convicted, Harris faces a mandatory minimum term of 10 years in prison with a statutory maximum sentence of life, up to five years of supervised release, a $200 special assessment and a possible fine.

The case was investigated by the FBI and the Plymouth Township Police Department.  It is being prosecuted by Assistant United States Attorney José R. Arteaga.

An Indictment is an accusation.  A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – A chemical company headquartered in Allentown, PA, has agreed to plead guilty to a six count information charging it with shipping monomethylamine (MMA) to customers in Mexico for whom required identification had not been obtained and failing to report the disappearance of shipments of MMA.  Taminco US, Inc. (“Taminco”), has also reached a settlement with the United States of civil claims concerning the same conduct and has agreed to pay a civil fine of $475,000.  Taminco has agreed to a criminal penalty of $860,374, which comprises a criminal fine of $650,000 and forfeiture of $210,374. The agreements must be accepted and approved by United States District Court Judge Edward G. Smith.  The case was announced today by First Assistant United States Attorney Louis D. Lappen.

Taminco manufactured, distributed, sold and exported MMA.  MMA is classified as a “List I” chemical and regulated by the Drug Enforcement Administration (DEA) because it is a necessary chemical for one method of manufacturing methamphetamine, a controlled substance.  Due to its List I chemical classification, a manufacturer is required to confirm the identity and verify the legitimacy of any customer to whom it ships the product. The manufacturer is also required to immediately report to the DEA any unusual or excessive loss or disappearance of the product.  Taminco manufactured MMA at its plant in Pace, Florida, and had the MMA packaged in 55 gallon drums before shipping it to the border at Laredo, Texas.

According to court documents filed today, between February and June of 2010, Taminco shipped six loads of MMA to two different customers in Mexico for whom Taminco had not obtained required identification.  Each load was approximately 16,800 kilograms of MMA.  According to court documents, some shipments of MMA disappeared and Taminco failed to promptly report the disappearances to the DEA as required by statute.

DEA discovered evidence of some barrels from missing shipments in August 2011, and discovered some of the missing barrels of MMA in December 2011 and April 2012.  In August 2011, DEA agents located wrappers from the June 2010 shipment of MMA drums in an abandoned residence in San Luis, Arizona.  In December of 2011, Customs and Border Protection officers intercepted five Taminco drums of MMA when an individual (not associated with Taminco) attempted to transport them by truck into Mexico at Nogales, Arizona.  In April of 2012, DEA agents found and seized six additional Taminco drums of MMA at a self-storage unit in Nogales, Arizona. The drums that DEA seized were from March 2010 shipments to the unverified Mexican customer.

Taminco’s civil settlement with the United States resolves civil claims arising from 19 shipments of MMA in early and mid-2010 that were authorized by Taminco without proper verification of the existence and validity of the foreign business entities ordering the List I chemicals.  According to the civil claims, Taminco also could not verify that certain of the MMA shipments reached their intended recipient in Mexico, and Taminco failed to report to DEA that those shipments were missing or that delivery could not be verified.  

As part of the civil settlement, Taminco has entered into a Memorandum of Agreement (MOA) with the DEA under which Taminco has agreed to comply with certain heightened compliance requirements regarding the manufacture, sale and shipment of listed chemicals.  DEA has agreed to forego administrative action against Taminco’s DEA registrations, subject to Taminco’s compliance with the terms of the MOA.

“The defendant in this case violated the law when it chose to ship DEA regulated precursor chemicals, which it knew could be used to manufacture methamphetamine, without following procedures designed to ensure that these chemicals do not end up in the hands of drug dealers,” said Lappen. “As part of our continuing responsibility to help protect the public from dangerous drugs, this office will continue to use both criminal and civil penalties to ensure that companies properly handle List I chemicals.”

“A primary function of the DEA’s Office of Diversion Control is to prevent, detect, and investigate the diversion of listed chemicals such as MMA from chemical supply companies.  This chemical is often used by drug-trafficking organizations to manufacture methamphetamine, which is a highly addictive drug,” said Special Agent-in-Charge Gary Tuggle, DEA Philadelphia. “DEA Diversion Investigators play a pivotal role in the agency’s mission of combating the diversion of listed chemicals for illegal purposes.  The DEA will remain aggressive in pursuing criminal violations of this nature.”

“DEA in Arizona and Philadelphia worked closely with other members of law enforcement in an effort to determine what became of these chemicals which have the potential to become harmful drugs,” said Special Agent-in-Charge Doug Coleman, DEA Arizona. “DEA is responsible for protecting our citizens from the dangers of drugs and will pursue all responsible parties who play a role in the manufacture and distribution of illicit drugs and their precursors.”

The case was investigated by the Yuma, AZ Resident Office and Scranton Resident Office of the Drug Enforcement Administration with assistance from Customs and Border Protection.  It is being prosecuted by Assistant United States Attorneys Albert S. Glenn and Charlene Keller Fullmer.

PHILADELPHIA - Beverly Smyre, 72, of Philadelphia, Pennsylvania, was charged by Information with one count of theft of government funds, announced United States Attorney Zane David Memeger.  According to the information, Smyre’s mother died in November 1989 but Smyre received the Social Security benefits intended for her mother until August 2015 when the fraud was discovered.  The defendant’s alleged actions resulted in a loss to the government of approximately $111,273.10.         

If convicted, Smyre faces a substantial period of incarceration, a three‑year period of supervised release, restitution to the government of $111,273.10, a fine of up to $250,000, and a $100 special assessment.

The case was investigated by the Social Security Administration Office of Inspector General and is being prosecuted by Special Assistant United States Attorney Amanda R. Reinitz.

An Information is an accusation.  A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – Thael Kuran, 23, of Philadelphia, PA, pleaded guilty today to conspiracy to commit health care fraud and making false statements in a health care matter.  The charges stem from a fraud scheme involving Brotherly Love Ambulance, Inc.  U.S. District Court Judge Gerald J. Pappert scheduled a sentencing hearing for January 19, 2016.  Kuran faces a maximum possible sentence of 15 years in prison, three years of supervised release, a $500,000 fine, and a $200 special assessment.     

In July 2010, the defendant’s mother, Feda Kuran, who was charged and convicted separately, began operating Brotherly Love Ambulance a co-schemer.  From approximately July 2010 through approximately October 2011, Thael Kuran transported patients for Brotherly Love even though those patients could walk and could have been transported safely by means other than ambulance and were, therefore, not eligible for ambulance service under Medicare and Medicaid requirements.  Thael Kuran also transported patients in his personal vehicle and in a minivan owned by Brotherly Love, both of which lacked the lifesaving equipment found in an ambulance.  Even when he transported patients in his personal vehicle, Kuran completed ambulance “run sheets” for the trips and certified those sheets with his signature.  In order to make the transports appear as though they had been done via ambulance, those run sheets misstated the medical condition of the patients and the care provided to the patients during the transports.  After Brotherly Love ceased operations, Thael Kuran completed run sheets at a successor company, VIP Ambulance, that were false in that they were inconsistent with one another and contained no legitimate signature by an Emergency Medical Technician (EMT).

As a result of the overall scheme at Brotherly Love, the Medicare program was billed for more than $4.9 million and paid more than $2 million in inappropriate claims.

This case was investigated by the U.S. Department of Health and Human Services Office of the Inspector General, the Federal Bureau of Investigation, and the U.S. Department of Labor Office of the Inspector General.  It is being prosecuted by Assistant United States Attorneys Mary E. Crawley and Paul W. Kaufman.

PHILADELPHIA – Farhan Ali Abu Siam, 42, of Philadelphia, was sentenced today to 30 months in prison for defrauding the United States Department of Agriculture (USDA)’s Supplemental Nutrition Assistance Program (SNAP), formerly known as the food stamp program. The defendant pleaded guilty to conspiring to traffic in SNAP benefits and commit wire fraud; wire fraud; and aiding and abetting trafficking in SNAP benefits.

The defendant owned and operated S&S Farmer’s Market, a retail grocery store, now defunct, that was located at 2722 Germantown Avenue in Philadelphia.  At his guilty plea hearing, the defendant admitted that he knowingly trafficked in SNAP benefits, and directed his employees to traffic in SNAP benefits, by purchasing those benefits from customers of S&S, which is illegal.  The defendant admitted that within a 15-month period, he was responsible for a program loss of $1,390,482.

In addition to the prison term, Senior U.S. District Court Judge John R. Padova ordered restitution of $1,390,482 to USDA, three years of supervised release to follow imprisonment, and directed that the defendant not own or operate any company that accepts SNAP benefits while on supervised release.

The case was investigated by the U.S. Department of Agriculture Office of Inspector General and Homeland Security Investigations.  It was prosecuted by Assistant United States Attorney Mary E. Crawley.

PHILADELPHIA - Christine Yoder, 33, of Philadelphia, PA, was sentenced today to 300 months in prison for charges of child exploitation that involved the sexual abuse of a 6-year old child and a 16-month old infant.  Yoder pleaded guilty on March 9, 2015, to two counts of employing a child to produce images of the child engaged in sexually explicit conduct and two counts of distributing material involving the sexual exploitation of children.

In May of 2014, Yoder sent a photograph to an undercover FBI agent of a 6-year-old (“Minor #1”), which depicted that child engaging in sexually explicit conduct.  Thereafter, Yoder offered to fly Minor #1 to Detroit for sexual activity.  Yoder also produced pornographic photographs of a 16-month old.

In addition to the prison term, U.S. District Court Chief Judge Petrese B. Tucker ordered 10 years of supervised release, and a $400 special assessment.

The case was investigated by the Federal Bureau of Investigation and was prosecuted by First Assistant United States Attorney Louis D. Lappen.

Denise Walls Ama, 64, of Haverford, Pennsylvania, was charged today by information with one count of theft of government funds, announced United States Attorney Zane David Memeger.  According to the information, the defendant’s mother died in May 2006 yet she continued to receive retirement benefits intended for her mother until January 2015.  The defendant’s alleged actions resulted in a loss to the government of approximately $108,306.         

If convicted, the defendant faces a maximum possible sentence of 10 years in prison, up to three‑years of supervised release, restitution to the government of $108,306, a fine of up to $250,000, and a $100 special assessment.

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

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

PHILADELPHIA - Michael Donnelly, 47, of Lecanto, Florida was charged today by information in an investment scheme that bilked his friends and clients of nearly $2 million, announced United States Attorney Zane David Memeger.  Donnelly is charged with one count of wire fraud and with one count of securities fraud.

Donnelly was an investment advisor and registered representative who served as president of Donnelly, Steen & Company, doing business as Coastal Investment Advisors, Inc., Coastal Equities, Inc., and Donnelly Advisors Group, which he also owned.  According to the information, between November 2007 and August of 2014, Donnelly persuaded about a dozen investors, many of whom were senior citizens, to allow him to invest their money in securities or certificates of deposit.  It is alleged that instead of investing his clients’ money, Donnelly appropriated the investment funds for his own use.

The information further alleges that Donnelly provided at least one client with brokerage account statements belonging to another client who held dozens of large cap stocks in an effort to conceal that he had appropriated the monies for his own use.  When an investing couple asked Donnelly for their funds, he allegedly persuaded another investor to partially liquidate an annuity under the guise that there was an opportunity to buy out another investor.  He then allegedly intended to use those funds to pay the investing couple rather than buying out an investment held by another client.

In a parallel action, the Securities and Exchange Commission today announced a civil settlement with Donnelly relating to the same conduct.

If convicted the defendant faces a maximum possible sentence of 40 years in prison, not more than three years of supervised release, a $5.25 million fine and a $200 special assessment.

The case was investigated by the FBI with assistance from the Securities and Exchange Commission Division of Enforcement. It is being prosecuted by Assistant U.S. Attorney Linwood C. Wright, Jr.

An Information is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – ECL Solutions Limited, Inc., doing business as Ban-Air Storage Systems, a wholly-owned subsidiary of a privately-held British company (“ECL”), pleaded guilty today to conspiring to smuggle goods into the United States, in connection with a scheme to conceal the country of origin of its merchandise. U.S District Court Judge C. Darnell Jones II immediately ordered the company to pay a forfeiture money judgment in the amount of $1,066,132.10.

ECL sold, among other things, large scale steel racking systems.  According to court documents, between November 2011 and September 2013, ECL intentionally failed to accurately mark its merchandise “Made in China,” in an effort to deceive the end-users, including the United States military, as to where these products were manufactured.  In order to maximize its profit and gain a commercial advantage, ECL deceived the United States Customs and Border Protection (CBP), the United States Military, and private customers when it failed to mark its racking components “Made in China.”  The conspiracy enabled ECL to pass off its shelving product as compliant with the Buy American Act (BAA) and Trade Agreements Act (TAA) when, in fact, it was using prohibited Chinese steel.

The case was investigated by Homeland Security Investigations (HSI) and the Defense Criminal Investigative Service (DCIS).  It was prosecuted by Special Assistant United States Attorney Josh A. Davison.

David Murray, 32, and Terrell Lang 23, of Philadelphia, Pennsylvania were charged today by indictment for their roles in the commission of two Hobbs Act robberies of pharmacies in Montgomery County, Pennsylvania.  The charges arise from the defendants’ June 28, 2015 robbery of over $7,000 from the CVS Pharmacy, located at 2622 Jenkintown Avenue in Glenside, Pennsylvania, and David Murray’s September 15, 2015 robbery of over $4,000 from the Walgreens Pharmacy located at 1 Yorktown Plaza in Elkins Park, Pennsylvania. 

If convicted the defendant David Murray faces a maximum possible sentence of 40 years’ imprisonment and co-defendant, Terrell Lang, faces a maximum possible sentence of 20 years’ imprisonment.

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

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

PHILADELPHIA - Lori Hilbourn, 30, of East Lampeter Township, PA, was sentenced today to 12 years in prison for manufacturing child pornography and distribution and possession of pornographic images that depicted her own child.  In addition to the prison term, U.S. District Court Judge Jeffrey L. Schmehl ordered 15 years of supervised release and a $400 special assessment.

Hilbourn pleaded guilty, on February 27, 2015, to two counts of manufacturing and one count each of distributing and possessing child pornography.  Hilbourn admitted that, beginning in December 2013 and continuing for several months, she took sexually explicit photographs of her child at the request of her then-boyfriend, George Wakeley, Jr.  Using her cell phone, Hilbourn then texted the photos to Wakeley, who posted them on the Internet to his Flickr account to share with other users who wanted child pornography.  On April 1, 2014, a search of Hilbourn’s cell phone pursuant to a search warrant revealed that she still possessed 15 nude and sexually explicit images of her 10-year old child.

Hilbourn must register as a sex offender.  Wakely pleaded guilty to charges of receipt; distribution; and possession of child pornography.  He was sentenced on September 2, 2015 to six years in prison.

The case was investigated by the East Lampeter Township Police Department with assistance from the FBI. It was prosecuted by Assistant United States Attorney Michelle Rotella.

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.

PHILADELPHIA - Rigoberto Zavala-Cerrato, 28, of Kennett Square, PA, was charged today by indictment with illegal reentry after deportation, announced United States Attorney Zane David Memeger.  The indictment alleges that on or about September 15, 2015, Zavala-Cerrato, 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 February 4, 2010.

If convicted the defendant faces a maximum possible sentence of 20 years.

The case was investigated by Homeland Security Investigations (“HSI”), and is being prosecuted by Assistant United States Attorney Frank R. Costello, Jr.

An Indictment is an accusation.  A defendant is presumed innocent unless and until proven guilty.

William Young, Jr., 71, of Philadelphia, Pennsylvania, was charged by information with one count of theft of government funds, announced United States Attorney Zane David Memeger.  According to the Information, the defendant received retirement benefits intended for his father, after his father’s death in May 2008 until April 2014.  The defendant’s alleged actions resulted in a loss to the government of approximately $36,189.         

If convicted, the defendant faces a term of in prison, a three‑year period of supervised release, restitution to the government of $36,189, a fine of up to $250,000, and a $100 special assessment.

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

An Information is an accusation.  A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA - Steven W. Johnson, Ph.D., 50, of Elkins Park, PA, was sentenced today to 12 months and one day in prison for theft from a program receiving federal funds.  Johnson pleaded guilty on April 30, 2015 to one count of misusing federal funds for cancer research to conduct a for-profit business.  In addition to the prison term, U.S. District Court Judge Paul S. Diamond also ordered Dr. Johnson to pay restitution of $69,379.02 and a $100 special assessment.

Dr. Johnson was an employee of the University of Pennsylvania, in its School of Medicine, from approximately October 1998 to February 2010.  Dr. Johnson conducted cancer research.  For some of his research activities, Dr. Johnson would need to test or “validate” (or to have another University of Pennsylvania employee validate for him) presumptive oligonucleotide “primers,” which are used to identify gene expression patterns.  The process of validating oligonucleotide primers requires expertise, time, effort, and specialized equipment, including a polymerase chain reaction (“PCR”) machine.  In approximately August 2005, while an employee of the University of Pennsylvania, Dr. Johnson started a for-profit company, which advertised human, mouse, and rat validated primers for sale.  (The University had no knowledge of Dr. Johnson’s for-profit company.)  In approximately 2006, while an employee of the University of Pennsylvania, Dr. Johnson applied for a federal grant from the Department of Defense (“DOD”) to study a new approach to treating ovarian cancer.  Between 2007 and 2009, Dr. Johnson purchased thousands of unvalidated oligonucleotide primers, which were charged to the federal grant.  Dr. Johnson used the University of Pennsylvania’s laboratory equipment, including a polymerase chain reaction (“PCR”) machine, which also had been purchased with federal grant funds, to test, or “validate,” the primers.  Johnson then sold the validated primers to customers of his for-profit company.

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

PHILADELPHIA - Jerome Walker, 30, of Philadelphia, PA, was charged today by indictment with distribution of cocaine base “crack,” possession with intent to distribute cocaine base “crack,” and cocaine, possession of a firearm in furtherance of a drug trafficking crime, and possession of a firearm by a convicted felon, announced United States Attorney Zane David Memeger.  The indictment alleges that in April 2015, Walker distributed “crack” cocaine on three occasions, possessed more than 280 grams of “crack” cocaine with intent to distribute, and possessed a loaded semi-automatic pistol and a loaded assault rifle.

If convicted the defendant faces a mandatory minimum sentence of 25 years in prison with a statutory maximum sentence of life, a $700 special assessment, supervised release and a possible fine.

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 Salvatore L. Astolfi.

     An Indictment is an accusation.  A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – Arthur Office, 45, of Houston, TX, was sentenced today to 144 months in prison for his role in a drug trafficking conspiracy.  Office pleaded guilty on April 1, 2015, to conspiracy to distribute five kilograms or more of cocaine and 280 grams or more of cocaine base.

During an undercover investigation of co-conspirator Omar Vasquez in March of 2008, Vasquez was stopped by police while driving in Lancaster, PA.  He and a passenger fled and, with police in pursuit, they began throwing crack cocaine from the windows of their vehicle.  Police recovered approximately 128 grams of cocaine from the highway.  Agents with Homeland Security Investigations subsequently searched Vasquez’s car and home, recovering more drugs and money, and were able to trace the source of the cocaine to Arthur Office of Houston, Texas.

An investigation revealed that Office had been supplying cocaine to other drug dealers in Chester County since the late 1990s to 2009.  For several years, Office regularly  flew from Texas to Philadelphia personally carrying several kilograms of cocaine strapped to his body.  On two occasions in 2008 and 2009, on his way back to Texas from Philadelphia International Airport, HSI agents seized over $80,000 in U.S. currency from Office.

In addition to the prison term, U.S. District Court Judge Lawrence Stengel ordered 5 years of supervised release, a $100 special assessment, and a fine of $2500.

The case was investigated by Homeland Security Investigations, the Drug Enforcement Administration, the Lancaster Police Department and the Pennsylvania State Police.  It was prosecuted by Assistant United States Attorney James R. Pavlock.

PHILADELPHIA - Terrence Harper, 41, of Philadelphia, PA, was charged today by indictment with two robberies and an attempted robbery at businesses in Philadelphia, announced United States Attorney Zane David Memeger.  According to the indictment, on December 13, 2013, Harper attempted to rob the Family Dollar Store, located at 6337 North Broad Street, and carried out a robbery at that same Family Dollar Store on December 15, 2013.  Harper also allegedly robbed the Whisper Inn, at 7610 Ogontz Avenue, on December 18, 2013.  The indictment also charges Harper with related firearms offenses.    

If convicted of all charges, the defendant faces a mandatory minimum sentence of 32 years in prison with a statutory maximum sentence of life, up to five years of supervised release, a $500 special assessment, possible fines, and restitution.

This case was investigated by the Federal Bureau of Investigation, Philadelphia Police Department, and the Philadelphia District Attorney=s Office. It is being prosecuted by Assistant United States Attorney Ewald Zittlau.

An Indictment is an accusation.  A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA - Salahudin Shaheed, 35, and Basil Buie, 24, both of Philadelphia, PA, pleaded guilty today to their roles in a botched robbery and kidnapping that involved a jewelry store employee.  Both defendants pleaded guilty today to conspiracy, kidnapping, and attempted Hobbs Act robbery. A third defendant, Khayree Gay, pleaded guilty earlier.  A sentencing hearing for Buie and Shaheed is scheduled for January 2016.

Shaheed recruited defendants Gay and Buie, a/k/a “Basil Tucker,” to rob National Watch and Diamond Exchange, at 101 S. 8th Street in Philadelphia to obtain luxury watches, jewelry, and money which Shaheed said could be found there.  The defendants conducted surveillance of National Watch and its employees from a parking lot at 733 Chestnut Street, to identify and then, in disguise, abduct an employee from whom they would forcibly obtain keys, security codes, and the code to the company’s safe from which the robbers would steal luxury watches, jewelry, and money.

On April 4, 2015, the defendants watched an employee that Shaheed had targeted.  When the employee entered the garage and approached her car, Shaheed and Buie, wearing masks, gloves, and sunglasses, confronted the victim, Shaheed assaulted her with a Taser, and they kidnapped her.

Each defendant faces a maximum possible statutory sentence of life in prison, five years of supervised release, a fine of up to $750,000, and a $300 special assessment.

The case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and is being prosecuted by Assistant United States Attorneys Jeanine Linehan and Maureen McCartney.

PHILADELPHIA- Miguel Amaris-Caviedes, 37, of Costa Rica, pleaded guilty today to two counts of knowingly conducting financial transactions that involved purported drug proceeds. A sentencing hearing is scheduled for January 7, 2016.

Amaris-Caviedes was laundering purported drug proceeds through Costa Rican bank accounts.  In 2013, Amaris-Caviedes met with individuals to discuss money laundering and drug trafficking methods from Costa Rica.  Amaris-Caviedes agreed to launder what he believed to be drug proceeds through four Costa Rican bank accounts and then wire transfer the proceeds, minus his commission, to any country requested.  In November 2013, Amaris-Caviedes laundered more than $100,000 of purported drug proceeds through his bank accounts in Costa Rica to a bank account in Puerto Rico.  Amaris-Caviedes believed that this money would be used to purchase drugs from a source of supply in Puerto Rico. Amaris-Caviedes was arrested in Spain on November 16, 2014 by INTERPOL agents.     

The case was investigated jointly by the Drug Enforcement Administration, the Internal Revenue Service Criminal Investigations, and Homeland Security Investigations.  It is being prosecuted by Assistant United States Attorneys Karen S. Marston and Kevin R. Brenner.

PHILADELPHIA – The United States has reached a settlement with Mercy Suburban Hospital (“Mercy”), in East Norriton, PA, to resolve alleged violations of title III of the Americans with Disabilities Act (“ADA”) for refusal to treat an HIV-positive patient at one of its facilities, announced United States Attorney Zane David Memeger.

According to the United States' allegations, in 2013, an HIV-positive patient was turned away from a Mercy bariatric facility without evaluation or treatment because the patient was HIV-positive. Under title III of the ADA, no person who owns, leases (or leases to), or operates a place of public accommodation may discriminate against an individual on the basis of disability in the full and equal enjoyment of the goods, services, facilities, privileges, advantages, or accommodations of a place of public accommodation.   

As a result of the United States’ investigation, Mercy has agreed to pay Complainant $20,000 and to pay the United States a civil penalty in the amount of $5,000.  In addition, Mercy has agreed to implement a non-discrimination policy, advertise that policy, and adequately train employees and contractors regarding the policy.  The settled civil claims are allegations only.  There has been no determination of civil liability, and Mercy denies any such liability.

This matter was based upon a Complaint filed with the United States Department of Justice by the AIDS Law Project of Pennsylvania.  The case was investigated by Assistant United States Attorney Jacqueline C. Romero.

PHILADELPHIA – Mark Postell, 52, of Philadelphia, PA, was charged by indictment, unsealed today, on one count of wire fraud announced United States Attorney Zane David Memeger.

According to the indictment, on April 28, 2015, Postell impersonated a pastor with the Church of Jesus Christ of Latter-day Saints for the purpose of fraudulently cashing a refund check issued to the church by PECO.  The refund check, in the amount of $183,698.82, was for overbilling and was mailed to an address used by the church.  Postell presented the check at a check cashing store and represented to the owner that he was a pastor with the church, that he, in fact, lived at the address on the check, and that he was authorized to cash the check, none of which was true.  After the check was deposited and processed by the bank, Postell returned to the check casher to retrieve the cash.

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

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

An Indictment is an accusation.  A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – Robert G. Wray, 76, of Torrey, Utah, was sentenced today to 48 months in prison for conspiring with a Lehigh County doctor of osteopathy to defraud the Department of Health and Human Service and the Internal Revenue Service. Wray conspired with Dr. Dennis Erik Fluck Von Kiel, of Macungie, Pennsylvania, to help Dr. Von Kiel evade a six-figure debt he owed to HHS for unpaid medical school loans and avoid paying personal income taxes to the IRS. The scheme defrauded the government of hundreds of thousands of dollars.  On May 28, 2015, a federal jury found Wray guilty of one count of conspiracy, 30 counts of wire fraud, one count of bankruptcy fraud, and one count of failure to appear.

Wray uses many different names for himself in an attempt to evade federal and other laws by arguing that he has not been properly identified in legal documents.  Wray also claims to be a “sovereign” citizen who is not subject to federal laws, including laws regarding personal income taxation. In addition to the prison term, U.S. District Court Judge Jeffrey L. Schmehl ordered restitution and forfeiture in the amount of $519,229.11 ($256,926.11 to IRS and $262,303.11 to HHS), a $3,300 special assessment and three years of supervised release.

The case was investigated by the IRS Criminal Investigations and the FBI. It is being prosecuted by Assistant United States Attorney Mark B. Dubnoff.

PHILADELPHIA - Jacob Corropolese, Sr., 65, of Norristown, PA, was sentenced today to 12 months and a day in prison for tax charges in connection with his sports bookmaking operation.  On May 6, 2015, Corropolese pleaded guilty to two counts of filing false tax returns. Corropolese received more than $500,000 in proceeds from bettors when he ran a sports bookmaking operation but did not report any of the income on his federal income tax returns for 2010 and 2011. As a result he substantially underreported his income resulting in a total tax loss of $120,002.

In addition to the prison term, U.S. District Court Judge Jan E. DuBois ordered the defendant to cooperate with the IRS in its collection of $238,000 in taxes, interest, and penalties, including $50,000 paid today, a special assessment of $200, and one year of supervised release.  Corropolese was ordered to report to prison by November 30, 2015.

This case was investigated by the Internal Revenue Service Criminal Investigations and the FBI. It was prosecuted by Assistant United States Attorney Nancy E. Potts.

PHILADELPHIA - Mohammed Uddin, 51, of Philadelphia, PA, was charged by indictment, unsealed today, with defrauding a government assistance program, announced United States Attorney Zane David Memeger.  Uddin is charged with 15 counts of wire fraud and 13 counts of trafficking in SNAP benefits.  SNAP is the Supplemental Nutrition Assistance Program, formerly known as the federal Food Stamp program, run by the United States Department of Agriculture’s Food and Nutrition Service to reduce and end hunger in the United States.

Uddin owned and operated Al Madina Halal Meat & Grocery, a retail grocery store, located at 6637 Castor Avenue in Philadelphia.  According to the indictment, the defendant trafficked SNAP benefits by purchasing those benefits from customers of Al Madina Halal Meat & Grocery in exchange for cash, which is illegal.  It is further alleged that between January 2012 and September 2015, as a result of his trafficking activities, defendant sought and received from USDA, redemption of more than $1 million in SNAP benefits.

If convicted, defendant Uddin faces a substantial period of incarceration, restitution to the program, a $2,800 special assessment, up to three years of supervised release, and possible fines.

The case was investigated by the United States Department of Agriculture Office of Inspector General and Homeland Security Investigations (HSI).  It is being prosecuted by Assistant United States Attorney Joan E. Burnes.

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

PHILADELPHIA - An indictment was unsealed today charging Aaron Dashawn Caple, 23, of Philadelphia, PA, in a fraud scheme involving bad checks and social media.  Caple is charged with four counts of bank fraud and 22 counts of aggravated identity theft, announced United States Attorney Zane David Memeger.

According to the indictment, Caple used social media services Twitter and Facebook to solicit potential co-schemers to message him if they wanted to make quick cash and had an account at a bank or other financial institution.  From those that responded, he obtained their bank ATM cards and PIN numbers and allegedly used that information to deposit bad checks into those accounts and withdraw the funds before the banks and other financial institutions realized that the checks were bad.  He also allegedly used the ATM cards and PIN numbers at various stores to purchase goods and obtain cash back prior to the banks discovering that the checks were bad.  It is further alleged that Caple paid the account holders a portion of the more than $45,000 he unlawfully obtained as a result of the scheme.

If convicted, defendant Caple faces a mandatory minimum term of two years in prison with a statutory maximum sentence of 144 years, up to five years of supervised release, a fine of up to $9.5 million, and restitution of at least $47,000.

The case was investigated by the United States Postal Inspection Service and is being prosecuted by Assistant United States Attorney Michael S. Lowe.

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

PHILADELPHIA – Lassana Nianghane, 52, of Philadelphia, PA, was charged by information, filed yesterday, with trafficking in counterfeit goods, announced United States Attorney Zane David Memeger. According to the information, Nianghane, also known as “the Purse Man,” sold counterfeit womens’ designer purses and counterfeit sneakers, among other items, on the sidewalk near Germantown and Chelten Avenues in Philadelphia PA.

According to the information, between September 2011 and June 2014, Nianghane intentionally trafficked in approximately $127,200 worth of goods and used counterfeit marks identical to and substantially indistinguishable from the shape and imprints found on genuine designer purses and sneakers.

If convicted, defendant Nianghane faces a maximum possible sentence of 10 years in prison, a fine of up to $2 million, a $100 special assessment and up to three years of supervised release.

The case was investigated by U.S. Department of Agriculture Office of Inspector General and Homeland Security Investigations (HSI).  It is being prosecuted by Assistant United States Attorney Floyd Miller.

An Information is an accusation. A defendant is presumed innocent unless and until proven guilty.

Donald Joseph Brown, 44, previously living in Philadelphia, PA, was charged today by indictment with bank robbery, announced U.S. Attorney Zane David Memeger.  The indictment charges that Brown committed a robbery of the TD Bank, located at 3805 Neshaminy Boulevard in Bensalem, Pennsylvania, on August 27, 2015.

If convicted, Brown faces a maximum sentence of 20 years in prison, a $250,000 fine, three years of supervised release, and a $100 special assessment.

This case has been investigated by the Federal Bureau of Investigation and the Bensalem Township Police Department. The case has been assigned to Assistant United States Attorney Thomas M. Zaleski.

An Indictment is an accusation.  A defendant is presumed innocent unless and until proven guilty.

Evonne Hodges, 35, of Darby, PA, was charged today by indictment with maintaining a drug-involved premises, announced U.S. Attorney Zane David Memeger.  According to the indictment, between October 1, 2012 and May 24, 2013, Hodges managed and controlled rooms, as a lessee, in a residence in Darby, PA, and made those rooms available for the purpose of unlawfully storing and distributing marijuana.

If convicted, Hodges faces a maximum sentence of 20 years in prison, a fine of up to $500,000, three years of supervised release, and a $100 special assessment.

This case was investigated by the Federal Bureau of Investigation and the Darby Borough Police Department.  It is being prosecuted by Assistant United States Attorney Thomas M. Zaleski.

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

ALLENTOWN - Cori Merklinger, 24, of Reading, PA, was sentenced today to 27.5 years in prison for conspiracy to produce child pornography, three counts of production of child pornography, and one count of distribution of child pornography.  In addition to the prison term, U.S. District Court Judge James Knoll Gardner ordered 15 years of supervised release, a $500 special assessment, and $2300 in restitution.

Merklinger was initially identified through an undercover operation as a distributor of videos of young children being sexually assaulted by adults.  A search of his cellular phone led to the discovery of text messages with his then-19-year old girlfriend, Ambur Ham, also charged. Via text messaging, Merklinger directed Ham to take sexually explicit photos of the 3-, 4-, and 5-year old children she was babysitting. Text messages revealed that Merklinger repeatedly asked Ham to take photographs of the three minors engaging in sexually explicit conduct.  Merklinger went so far as to coach the children on speaker phone to engage in sexual conduct.  He pleaded guilty on November 27, 2013.  Ham had also pleaded guilty and was sentenced on July 2, 2015 to 20 years in prison, 15 years of supervised release, $2,300 restitution, and a $400 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 FBI, the Berks County Detectives and the Chester County Detectives, with assistance from the Berks County District Attorney’s Office and the Chester County District Attorney’s Office. It was prosecuted by Assistant United States Attorney Michelle L. Morgan

PHILADELPHIA – Douglas S. Rae, 58, of Bethlehem, PA, was charged today by indictment with participating in several schemes to defraud his former employer, a company based in West Chester, PA, of millions of dollars. Rae is charged with seven counts of mail fraud, 25 counts of wire fraud and conspiracy to commit wire fraud, and three counts of money laundering, announced United States Attorney Zane David Memeger.

In related matters, also charged today by information were John R. Hodde, 53, of Aubrey, TX, and Michael H. Keppler, 55, of Ridgewood, NJ.  Hodde and Keppler are separately charged with two counts of wire fraud and conspiracy to commit wire fraud for their alleged participation, along with Rae, in schemes to defraud Rae’s former employer.

According to the indictment, between 2006 and 2013, Rae devised a scheme to defraud his employer by submitting invoices from two companies he controlled for goods and services that were never delivered. Rae controlled the bank accounts for the two companies, Lighting Equipment Sales and Service, Inc. (“LESS”), and Lighting Products International, Inc. (“LPI”). He caused the victim company to pay over $900,000 for bogus LESS and LPI invoices, and he took the proceeds for his own personal use.

The charging documents further allege that from 2007 through 2013, Rae and Hodde devised a scheme to defraud Rae’s employer by submitting bogus invoices from Hodde’s employer, Barbizon Capitol, Inc. (“Barbizon”). One of the ways the men allegedly carried out this scheme began with Hodde allowing Rae to use Hodde’s corporate credit card account, which Rae used to for personal expenditures such as home appliances, airline tickets for him and his wife to visit their vacation home, personal electronics, and dental services. It is further alleged that Rae and Hodde then worked together to create bogus invoices from Barbizon to Rae’s employer for purported product sales, when in fact Barbizon did not supply any of the product. Rae and Hodde created the bogus invoices in amounts to reimburse Barbizon for all of Rae’s personal expenditures on the Barbizon credit card account, plus an approximately 10% mark-up, which Barbizon kept. In this manner, Rae and Hodde allegedly caused the victim company to pay over $560,000 for bogus invoices submitted to it from Barbizon. The other way Rae and Hodde allegedly carried out their scheme involved Rae submitting bogus invoices from LESS and LPI to Barbizon, and then at Rae’s direction, Hodde allegedly generated corresponding bogus invoices from Barbizon to Rae’s employer, along with an approximate 10% mark-up for Barbizon to keep.

Neither LESS, LPI, nor Barbizon supplied any of the product for which the victim company was invoiced. In this manner, according to the charging documents, Rae and Hodde caused the victim company to pay over $200,000 for the bogus invoices. Barbizon retained approximately 10% of those proceeds, and the remainder were forwarded to LESS and LPI and deposited into bank accounts controlled by Rae.

Between 2010 and 2012, Rae and Keppler allegedly devised a scheme to defraud Rae’s employer by submitting bogus invoices from Keppler’s company, Keppler Engineers, LLC (“Keppler Engineers”). Rae directed Keppler to generate invoices from Keppler Engineers to Rae’s employer that contained particular item descriptions, descriptions of services, and specific prices, and Keppler did as directed. Rae and Keppler caused those invoices to be submitted to the victim company for payment. The victim company paid Keppler Engineers for the invoices, and then Keppler Engineers paid all but approximately 10% of the proceeds to LPI, which Rae deposited into bank accounts he controlled. Neither Keppler Engineers nor LPI provided the products or services to the victim company. According to the charging documents, Rae and Keppler caused the victim company to pay over $170,000 for the bogus invoices from Keppler Engineers.

Rae is further charged with conducting three separate financial transactions of over $10,000 each in criminally derived proceeds.

If convicted, Rae faces up to 20 years in prison on each count of mail fraud, wire fraud, and conspiracy to commit wire fraud, and up to ten years in prison on each count of money laundering.  He also faces up to three years of supervised release, full restitution, a fine, a $3,500 special assessment, and criminal forfeiture. Hodde and Keppler each face up to 20 years in prison on each count of wire fraud and conspiracy to commit wire fraud, full restitution, three years of supervised release, a $500,000 fine, and a $200 special assessment.

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

Philadelphia - Michael Katzin, was charged today by superseding indictment with one count of conspiracy to commit pharmacy burglary, one count of conspiracy to possess with the intent to distribute controlled substances, one count of pharmacy burglary, and one count of possession with the intent to distribute controlled substances, announced United States Attorney Zane David Memeger.  The superseding indictment charges that the defendant conspired and agreed with Harry Katzin and Mark Katzin, both charged elsewhere, and others known and unknown to the grand jury, to enter Rite Aid pharmacies, including the Rite Aid pharmacy located at 1852 Brownsville Rd, Feasterville-Trevose, Pennsylvania on November 18, 2010,  and the Rite Aid pharmacy located at 807 S. 4th Street, Hamburg, Pennsylvania on December 16, 2010, with intent to steal materials and compounds containing any quantity of a controlled substance, including amphetamine salts, dextroamphetamine, fentanyl, methylphenidate, dexmethylphenidate, morphine sulfate, meperidine, oxymorphone, tapentadol, codeine sulfate, hydromorphone, hydrocodone, hydrocodone APAP, hydrocodone chlorpheniram, oxycodone, and oxycodone APAP, each a Schedule II controlled substance; and whose replacement value was not less than $500, and to knowingly and intentionally possess these controlled substances with the intent to distribute them.

The superseding indictment further charges that the defendant burglarized the Rite Aid Pharmacy at 807 South 4th Street, Hamburg, Pennsylvania on December 16, 2010, with intent to steal materials and compounds containing any quantity of a controlled substance, including to Schedule II and other controlled substances, including amphetamine salts, dextroamphetamine, fentanyl, methylphenidate, dexmethylphenidate, morphine sulfate, meperidine, oxymorphone, tapentadol, codeine sulfate, hydromorphone, hydrocodone, hydrocodone APAP, hydrocodone chlorpheniram, oxycodone, and oxycodone APAP; all Schedule II controlled substances; and whose replacement value was not less than $500, and

If convicted, the defendant faces a maximum sentence of 70 years imprisonment, a $2,500,000 fine, 3 years supervised release up to lifetime supervised release, and a $400 special assessment. The case was investigated by agents from the Federal Bureau of Investigation, the Drug Enforcement Administration, the Pennsylvania State Police, the New Jersey State Police, the Philadelphia Police Department, the Southampton Township Police Department, and the Hamburg Borough Police Department, and has been assigned to Assistant United States Attorney Thomas M. Zaleski.

PHILADELPHIA - Michael Katzin, 33, of Philadelphia, PA, was charged by superseding indictment with two pharmacy robberies, announced United States Attorney Zane David Memeger.  Katzin is charged with conspiracy to commit pharmacy burglary, conspiracy to possess with the intent to distribute controlled substances, pharmacy burglary, and possession with the intent to distribute controlled substances.

According to the indictment, Katzin conspired with Harry Katzin and Mark Katzin, both charged elsewhere, and others, to enter Rite Aid pharmacies, with intent to steal materials and compounds containing any quantity of a controlled substance.  The defendants allegedly robbed the Rite Aid pharmacy at 1852 Brownsville Rd, in Feasterville-Trevose, on November 18, 2010, and the Rite Aid pharmacy at 807 S. 4th Street, in Hamburg, on December 16, 2010, to steal amphetamine salts, dextroamphetamine, fentanyl, methylphenidate, dexmethylphenidate, morphine sulfate, meperidine, oxymorphone, tapentadol, codeine sulfate, hydromorphone, hydrocodone, hydrocodone APAP, hydrocodone chlorpheniram, oxycodone, and oxycodone APAP, each a Schedule II controlled substance.

If convicted, the defendant faces a maximum sentence of 70 years in prison, a fine of up to $2.5 million, up to a lifetime of supervised release, and a $400 special assessment.

The case was investigated by agents from the Federal Bureau of Investigation, the Drug Enforcement Administration, the Pennsylvania State Police, the New Jersey State Police, the Philadelphia Police Department, the Southampton Township Police Department, and the Hamburg Borough Police Department, and has been assigned to Assistant United States Attorney Thomas M. Zaleski.

An Indictment is an accusation.  A defendant is presumed innocent unless and until proven guilty.

Philadelphia - David Thomas, a/k/a David Thompson, 22, of Philadelphia, PA, Alvin Johnson, 29, of Philadelphia, PA, and Sharae Johnson Coleman, 28, of Philadelphia, PA, were charged today by indictment[i] in a series of robberies with charges of conspiracy and bank robbery.  Defendant David Thomas is charged with bank robbery for the robbery on May 14, 2015 of approximately $23,657 from Wells Fargo Bank, located at 52 North Bryn Mawr Avenue, Bryn Mawr, Pennsylvania; defendants David Thomas, Alvin Johnson and Sharae Johnson Coleman are charged with conspiracy and bank robbery for the robbery on June 2, 2015 of approximately $10,633 from Wells Fargo Bank, located at   52 North Bryn Mawr Avenue, Bryn Mawr, Pennsylvania; and defendants David Thomas and Alvin Johnson are charged with conspiracy and bank robbery for the robbery on June 30, 2015 of approximately $7,000 from TD Fargo, located at 8600 Germantown Avenue, Philadelphia, Pennsylvania; announced United States Attorney Zane David Memeger.

If convicted of the charges, defendant David Thomas faces a maximum sentence of 70 years imprisonment, defendant Alvin Johnson faces a maximum sentence of 50 years imprisonment, and defendant Sharae Johnson Coleman faces a maximum sentence of 25 years imprisonment.  They also each face a maximum period of supervised release of three years, a substantial fine, a special assessment, and restitution.

This case was investigated by the Federal Bureau of Investigation, the Philadelphia Police Department, and the Lower Merion Township Police Department, and is being prosecuted by Assistant United States Attorney Ewald Zittlau.
 

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

Ryan Joseph Hribick, 34, of Minersville, Pennsylvania, was sentenced today to 43 months in prison for possession of unregistered firearms, manufacturing and dealing explosive materials, conspiracy to obstruct justice, and witness tampering. Hribick made, possessed, and sold improvised explosive devices ("IEDs"), including PVC pipes – some containing nails, screws, and/or rocks – and cardboard tubes, all center primed with flash powder.

After federal agents searched his home, Hribick instructed and conspired with others to destroy and conceal cardboard tubes and flash powder – which Hribick was using to manufacture IEDs – so as to keep that evidence from federal agents and the federal grand jury. In addition, Hribick attempted to influence the testimony of a federal grand jury witness to lie about their destruction and concealment of evidence.

In addition to the 43 month prison term, United States District Judge Robert F. Kelly ordered three years of supervised release, a $2,500 fine, and a $400 special assessment.

The case was investigated by the Federal Bureau of Investigation, the Philadelphia Police Bomb Disposal Unit, the Montgomery County Bomb Squad, the Montgomery County Sheriff’s Office, the East Whiteland Police Department, the East Whiteland Fire Department, the Malvern Fire Department, the Maryland State Police,  North Carolina State Bureau of Investigation, and the Bureau of Alcohol, Tobacco, Firearms & Explosives . The case was prosecuted by Assistant United States Attorney Vineet Gauri.

PHILADELPHIA- Joseph Adens, 32, of Philadelphia, PA, was sentenced today to 27 years in prison for his involvement in two drug conspiracies, a money laundering conspiracy, and his possession and discharge of a firearm in furtherance of a drug trafficking crime.  Adens pleaded guilty on May 8, 2015, after eight days of trial.  In addition to the prison term, U.S. District Court Judge Gene E.K. Pratter ordered 10 years of supervised release, a fine of $4,000, and a $600 special assessment.

Adens shot co-conspirator Tasfa Payne, seven times at close range with a .45 caliber handgun, on June 13, 2011, after eleven kilograms of cocaine failed to arrive in Philadelphia from California.  The shooting occurred in front of the Universal Bluford Elementary School, on the 1400 block of Alden Street, and forced the school to lockdown its students.  Following the shooting, Adens continued to be involved with drug trafficking.  Specifically, in March 2012, Adens moved to Woodland Hills, California, where he continued to facilitate the transportation of multiple kilograms of cocaine and hundreds of pounds of marijuana from California to Philadelphia for distribution.  Adens also used multiple individuals’ bank accounts at financial institutions with branches in both Pennsylvania and California.  Adens arranged for his drug proceeds to be deposited in Philadelphia and then withdrawn in California to be used to purchase additional drugs.

The case was investigated jointly by the Federal Bureau of Investigation and Homeland Security Investigations, with assistance provided by the Los Angeles International Airport Narcotics Task Force and the Philadelphia Police Department.  It was prosecuted by Assistant United States Attorney Karen S. Marston.

HILADELPHIA – Mohammed Abuawada, 27, of Philadelphia, was sentenced yesterday afternoon to 18 months in prison for defrauding the United States Department of Agriculture (USDA)’s Supplemental Nutrition Assistance Program (SNAP), formerly known as the food stamp program. The defendant pleaded guilty to conspiring to traffic in SNAP benefits and commit wire fraud; wire fraud; and aiding and abetting trafficking in SNAP benefits.

The defendant operated S&S Farmer’s Market, a retail grocery store, now defunct, that was located at 2722 Germantown Avenue in Philadelphia.  At his guilty plea hearing, the defendant admitted that he knowingly assisted the store’s owners in trafficking in SNAP benefits, by withdrawing large sums of cash from the store’s bank accounts to fund the fraud.  The defendant admitted that within a three-month period, he withdrew approximately $209,000 in cash in order to assist the fraud against USDA, which was carried out by purchasing SNAP benefits from store customers for cash, which is illegal.

In addition to the prison term, Senior U.S. District Court Judge John R. Padova ordered restitution of $209,000 to USDA, three years of supervised release to follow imprisonment, and directed that the defendant not own or operate any company that accepts SNAP benefits while on supervised release.  He must surrender to begin serving his prison term on October 19, 2015.

The case was investigated by the United States Department of Agriculture Office of Inspector General and U.S. Immigration and Customs Enforcement Homeland Security Investigations.  It is being prosecuted by Assistant United States Attorney Mary E. Crawley.

PHILADELPHIA - Timothy D. Burns, (36), of Phoenixville, Pennsylvania, was sentenced today to 60 months in prison for mail fraud, wire fraud and loan fraud.  He pleaded guilty to the charges on June 25, 2013.  Burns was the sole owner of ESG Family Services, among other businesses.  ESG Family Services provided bill paying and other personal services to clients.  Burns induced many of his Family Services clients to add him as a signatory to their bank accounts.  He also represented to clients and others that he could acquire shares of Facebook and other social media stock before their public offerings at favorable prices.

            Between at least May 2007 and September 2012, Burns converted money entrusted to him by more than 50 clients and would-be investors for his personal gain.  In 2011, without their knowledge or consent, Burns used his clients’ and investors’ money to buy a shore home in Avalon, New Jersey, for more than $4 million and to make a down payment on a commercial office building in Conshohocken, Pennsylvania.  In 2012, he misrepresented to a bank that he had acquired stock, when he had not, to obtain a $6 million mortgage loan on the commercial office building. Burns used the fraudulently acquired shore home as collateral on a second loan of $1.5 million issued to him by the same bank to buy the office building.

            In addition to the prison term, U.S. District Court Judge Legrome D. Davis ordered restitution of $11,038,923.60, a $400 special assessment, five years of supervised release, and forfeiture. 

            The case was investigated by the FBI and the U.S. Postal Inspection Service.  It was prosecuted by Assistant United States Attorney Nancy E. Potts.

Mikel Smith, 25, of Philadelphia, PA, was charged today by information with robbery which interfered with interstate commerce for the armed robbery on November 16, 2014 of approximately $400 from the Dunkin Donuts, located at 717 East Girard Avenue, Philadelphia, Pennsylvania; announced United States Attorney Zane David Memeger.  Defendants brandished a handgun during each of the four robberies. Smith is also charged with possession of a firearm by a convicted felon.          

If convicted of the charge, defendant faces a maximum sentence of 20 years imprisonment, a maximum period of supervised release of three years, a substantial fine, a special assessment, and restitution.

This case was investigated by the Federal Bureau of Investigation, the Philadelphia Police Department, and the Philadelphia District Attorney's Office, and is being prosecuted by Assistant United States Attorney Ewald Zittlau.

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

PHILADELPHIA - Benjamin Twiggs, 37, of Philadelphia, Pennsylvania, was charged by indictment yesterday with one count of making a false statement and one count of transportation of goods taken by fraud, announced United States Attorney Zane David Memeger.  The fraud is in connection with the federal Computers For Learning (CFL) program, a program meant to allow federal agencies to donate excess computer equipment to schools and educational nonprofit organizations.

According to the indictment, in October 2013, Twiggs used a false document to state to the Department of Homeland Security that his organization was an IRS-recognized tax-exempt organization, when Twiggs knew that it was not.  The indictment charges further that in January 2015, Twiggs transported in interstate commerce 96 computer monitors that he had taken by fraud from the U.S. Patent and Trademark Office, which had donated them through the CFL program.

If convicted of the charges, the defendant faces a maximum possible statutory sentence of 15 years in prison, three years of supervised release, a fine of up to $500,000, a $200 special assessment, and forfeiture.

The case was investigated by the General Services Administration's Office of Inspector General. It is being prosecuted by Assistant United States Attorney Elizabeth Abrams.

An Indictment is an accusation.  A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA - Brandon Jones, 34, of Reading, PA, was sentenced today to 33 months in prison for his role in an identity fraud scheme.  U.S. District Court Judge Edward G. Smith also ordered five years of supervised release, a $300 special assessment, restitution of $72,554 and forfeiture in the same amount.  Jones pleaded guilty on May 15, 2015 to conspiracy, wire fraud and bank fraud.  Jones participated in an identity fraud scheme that involved stealing personal information, including from old court records.  The ringleader, Damian Gasdaska, was sentenced in May 2015 to 144 months in prison.  Jones is the last of the five defendants in the case to be sentenced.  Co-conpirator Randall McMahon, of Easton, PA, was sentenced in June of 2015 to 29 months; John Cordero, of Breinigsville, PA, was sentenced in June of 2015 to 18 months; and Johnnie Rhines, of Lindenwold, NJ, was sentenced in March of 2015 to 30 months.

The defendants used stolen information to create false identities which they then used to apply for credit cards and for purchasing or renting vehicles. Gasdaska provided some of the fraudulent credit cards he acquired to his co-conspirators and kept some for himself. He also showed his co-conspirators how to commit the fraud. Gasdaska took steps to create favorable credit profiles for these false identities, and to improve the individuals’ credit profiles. These steps included: obtaining reports on the individuals, requesting the modification of information in the reports, and engaging in transactions in the names of the false identities to improve their credit profiles. The defendants applied for loans in the name of the false identities for which Gasdaska had improved their credit profiles. The defendants secured fraudulent loans exceeding $200,000 to buy cars under false pretenses. They collectively purchased or attempted to purchase at least 15 different vehicles.  

Gasdaska used Post Offices boxes in the name of the false identities to receive mail for various purposes, such as in connection with credit card applications. He used computers at public libraries to further the conspiracy. After the defendants made their purchases, they often provided the purchased items to Gasdaska who then sold them and paid the co-conspirators for their illegal services. When Gasdaska and McMahon weres arrested in January 2013, Gasdaska was driving a car he had purchased through his fraud scheme that was filled with fraudulent documentation Gasdaska had generated and received during his scheme. In January of 2000, Jones was arrested while driving the car that he purchased through the scheme.

The case was investigated by United States Secret Service, the United States Postal Inspection Service, Homeland Security Investigations, and the Lehigh County Auto Theft and Insurance Fraud Task Force.  It was prosecuted by Assistant United States Attorney Patrick J. Murray.

FORMER MAINTENANCE DIRECTOR OF BRISTOL TOWNSHIP SCHOOL DISTRICT CHARGED WITH CONSPIRACY AND FRAUD

PHILADELPHIA - James N. Anders, Jr, 59, Willow Grove, PA, Patrick Squires, 58, of Voorhees, NJ, and Ernest Neff, 58, of Newtown, PA, were charged today by indictment with one count of conspiracy and five counts of wire fraud in connection with a scheme to defraud the Bristol Township School District (“BTSD”), announced United States Attorney Zane David Memeger. Anders is the former maintenance director at the school district.

The indictment charges that from September 2006 to September 2011, the defendants abused Anders’ position as maintenance director to enrich themselves and to advance their personal business interests, causing a loss to BTSD of approximately $373,453.43.  It is alleged that on a dozen transactions between September 2006 and July 1, 2010, Anders, Squires and Neff manipulated the required “quote” process to ensure that a company controlled by defendant Squires would be selected for the transaction.  It is also alleged that defendants Anders and Squires split BTSD maintenance department purchases into smaller transactions which could be purchased on the sole authority of defendant Anders, where he could direct those purchases to companies controlled by Squires.  It is further alleged that Anders engaged in prohibited self-dealing by using his personal company for BTSD business and disguised the work by billing the work through a Squires-controlled company.

If convicted of all charges, the defendants each face a maximum possible statutory sentence of 105 years in prison, with an advisory guidelines range of 46-57 months, three years supervised release, a $1.5 million fine, a $600 special assessment, restitution of approximately $373,453.43 and forfeiture.

The case was investigated by the Federal Bureau of Investigation and the United States Department of Education Office of Inspector General. It is being prosecuted by Assistant United States Attorney Joan E. Burnes.

An Indictment is an accusation.  A defendant is presumed innocent unless and until proven guilty.