Western District of Pennsylvania

ERIE, Pa. - A resident of Erie, Pennsylvania, pleaded guilty in federal court to charges of using a social security number assigned to another, United States Attorney David J. Hickton announced today.

Edward Phillips, 58, pleaded guilty to four counts before United States District Judge David S. Cercone.

In connection with the guilty plea, the court was advised that Phillips obtained and used a social security number that was not assigned to him to obtain various credit cards and loans.

Judge Cercone scheduled sentencing for February 7, 2014 at 11:30 a.m.  The law provides for a total sentence of 20 years in prison, a fine of $1,000,000, or both.  Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offenses and the criminal history, if any, of the defendant.

Pending sentencing, the court continued Mitchell on bond.

Assistant United States Attorney Christian A. Trabold is prosecuting this case on behalf of the government.

The Federal Bureau of Investigation and the Social Security Administration, Office of Inspector General conducted the investigation that led to the prosecution of Phillips.

PITTSBURGH - An individual found in Pittsburgh, Pa., has been indicted by a federal grand jury in Pittsburgh on a charge of re-entry into the United States after deportation, United States Attorney David J. Hickton announced today.

The one-count indictment named Milton Garcia-Lopez, 25, formerly from Guatemala, as the sole defendant.

According to indictment, Milton Garcia-Lopez, an alien, was removed from the United States by United States Immigration and Customs Enforcement on April 12, 2007. Milton Garcia- Lopez was found on May 27, 2013, subsequent to his arrest in Pittsburgh, Pa.

The law provides for a maximum total sentence of two years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.

Assistant United States Attorney Paul E. Hull is prosecuting this case on behalf of the government.

Immigration and Customs Enforcement conducted the investigation leading to the indictment in this case.

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

PITTSBURGH - An Allegheny County resident pleaded guilty in federal court to a charge of unlawfully selling drug samples, United States Attorney David J. Hickton announced today.

Lawrence A. Swanson, 54, pleaded guilty to one count before United States District Judge Cathy Bissoon.

In connection with the guilty plea, the court was advised that Swanson, from in and around January 2005, to in and around May 2011, knowingly and unlawfully sold drug samples, specifically, samples of Allegra, Avalide, Avapro, Avelox, Benicar, Celebrex, Crestor, Cymbalta, Diovan, Diovan HCT, Evista, Janumet, Januvia, Lexapro, Lovaza, Lyrica, Micardis HCT, Namenda, Nexium, Plavix, Prevacid, Prilosec, Seroquel XR, Singular, TriCor, Vytorin, Zetia, Zyprexa, Benicar, Lipitor, and Pristi Q, prescription drugs.

Judge Bissoon scheduled sentencing for Jan. 31, 2014. The law provides for a total sentence of 10 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the criminal history, if any, of the defendant.

Assistant United States Attorney Nelson P. Cohen is prosecuting this case on behalf of the government.

The U.S. Food and Drug Administration-Office of Criminal Investigations, and the Internal Revenue Service-Criminal Investigation, conducted the investigation that led to the prosecution of Lawrence A. Swanson.

PITTSBURGH - A former Aliquippa resident was sentenced to serve 200 months in prison, followed by five years of supervised release, for several violations of federal narcotics trafficking laws, United States Attorney David J. Hickton announced today.

Edward Harris, 38, was sentenced by United States District Judge Maurice B. Cohill. Harris was convicted of conspiring and attempting to possess with intent to distribute at least five kilograms of cocaine in May 2012. Harris was also convicted of possessing with intent to distribute cocaine in January 2011 and in June 2010. Harris was on bond for the June 2010 and January 2011 crimes when he committed the May 2012 crimes.

Assistant United States Attorney Craig W. Haller prosecuted the case on behalf of the United States.

U.S. Attorney Hickton commended the Bureau of Alcohol, Tobacco, Firearms, and Explosives, the Pennsylvania State Police, the Pittsburgh Bureau of Police and the Penn Hills Police Department for conducting the investigations that led to the convictions and sentence in this case.

PITTSBURGH - A resident of East Liverpool, Ohio, pleaded guilty in federal court to a charge of wire fraud, United States Attorney David J. Hickton announced today.

Daniel P. Lucas, 50, pleaded guilty to one count before Chief United States District Judge Joy Flowers Conti.

In connection with the guilty plea, the court was advised that Lucas defrauded three investors by representing that he was a successful currency trader and obtaining $78,000 from them for this purpose, and thereafter retaining and spending more than $49,000 for his own purposes, while earning no profits for investors and incurring more than $28,000 in currency trading losses.

Judge Conti scheduled sentencing for Jan. 10, 2014, at 3:30 p.m. The law provides for a total sentence of 20 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.

Pending sentencing, the court continued Lucas on bond.

Assistant United States Attorney Leo M. Dillon is prosecuting this case on behalf of the government.

The Federal Bureau of Investigation conducted the investigation leading to the indictment in this case.

PITTSBURGH - A resident of Monongahela, Pa., was sentenced to serve time in federal custody for violating federal firearms laws, United States Attorney David J. Hickton announced today.

Ronald DeGrange, 47, was sentenced by United States District Judge Donetta W. Ambrose to serve six months in the custody of the federal Bureau of Prisons at the Renewal Center in Pittsburgh, followed by two years of supervised release which includes a six-month term of home detention. DeGrange was convicted of providing false information to a federal firearms licensee by indicating that he was the actual buyer of a Mossberg 12 gauge shotgun with a pistol grip when he was actually acting on behalf of someone else and by indicating that he was not an unlawful user of, or addicted to, a controlled substance when he, in fact, was. DeGrange bought the firearm for an acquaintance who was a convicted felon and who was addicted to a controlled substance and could not lawfully purchase or possess firearms. DeGrange straw purchased firearms for that person three times and also sold the person a Colt AR-15 semi-automatic rifle on another occasion.

Assistant United States Attorney Craig W. Haller prosecuted this case on behalf of the United States.

The Bureau of Alcohol, Tobacco, Firearms, and Explosives, and the Pennsylvania State Police investigated this case. This case was prosecuted under Project Safe Neighborhoods, a collaborative effort by federal, state, and local law enforcement agencies, prosecutors, and communities to prevent, deter, and prosecute gun crime.

PITTSBURGH - A resident of Brentwood, Pa., has been sentenced in federal court to 88 months imprisonment and five years supervised release on his conviction of conspiracy to distribute controlled substances and to acquire controlled substances by fraud, forgery, deception and subterfuge, United States Attorney David J. Hickton announced today.

United States District Judge Mark R. Hornak imposed the sentence on Jeffrey William Mackewich, II, 27. Mackewich has been incarcerated since his bond was revoked by Judge Hornak in June 2013.

According to information presented to the court, Mackewich conspired to obtain Oxycodone by fraud and forgery and to then distribute the Oxycodone. Mackewich agreed that he distributed between 5,000 and 15,000 oxycodone 30 mg. tablets during the time frame of the conspiracy. He also agreed that he was the leader of the Oxycodone ring. Mackewich used a computer with software including medical clip art to counterfeit prescriptions using DEA registration numbers of unwitting physicians.

Assistant United States Attorney Stephen R. Kaufman prosecuted this case on behalf of the government.

U.S. Attorney Hickton commended the Drug Enforcement Administration for the investigation leading to the successful prosecution of Mackewich.

PITTSBURGH - After deliberating six hours, a federal jury of five men and seven women found Jason Moreno guilty of two counts wire fraud conspiracy and five counts of wire fraud, United States Attorney David J. Hickton announced today.

Moreno, 30, was tried before United States District Judge Nora Barry Fischer.

According to Assistant United States Attorney Brendan T. Conway, who prosecuted the case, the evidence presented at trial established that Moreno operated Platinum Appraisal Services, which provided hundreds of fraudulent appraisals in connection with two different complex mortgage fraud schemes. The appraisals were fraudulent in at least the following respects:

• The appraisals represented that they had been prepared by a licensed appraiser named Joel Reck when, in fact, they were prepared by Jason Moreno and others who were not licensed appraisers;
• The appraisals overstated the conditions of the properties and represented that they were in better condition than they actually were;
• The appraisals falsely represented that substantial improvements had been made to the properties;
• The appraisals failed to identify significant problems with the properties that effected the market values of the properties; and
• The appraisals represented that the properties being appraised, which are referred to as the "subject properties", were comparable to certain other properties, which are referred to as the "comparable properties", when, in fact, the comparable properties were in superior conditions and in superior locations than the subject properties.

All of these misrepresentations were designed to overstate the values of the properties serving as collateral for the loans.

One of Moreno's primary customers for the fraudulent appraisers was Robert Arakelian, who was a mortgage broker who operated Pittsburgh Home Loans along with his partner, Michael Ferrazza. Arakelian operated a mortgage fraud scheme in which he falsely represented to the lenders that the borrowers intended to and had made substantial down payments associated with the purchase of the properties. In fact, the borrowers were not making any down payments and were actually getting money back from many of the transactions. Thus, for the scheme to work, the loan amounts had to be sufficient to pay the seller, pay the buyer money back, as well as pay the closing costs and any kickbacks to Arakelian and others associated with the scheme.

Lenders, however, will typically only lend between 80% and 90% of the lower of the sales prices and the value of the home. The "value" is supposed to be determined by a licensed independent professional appraiser. In order to get a sufficient loan amount to make the disbursements associated with the scheme, the sales prices of the properties had to be drastically overstated, and these overstated sales prices had to be supported by similar fraudulently overstated appraisal values. Preparing and causing the preparation of the fraudulent appraisals was Moreno's role in the conspiracy. In the end, while the lenders believed that they were lending between 80-90% of the values of the properties, they were typically lending 150-200% of the values of the properties.

Another major customer for Moreno's fraudulent appraisals was James Platts, who operated East Realty Solutions. Platts' scheme was slightly different from Arakelian's scheme. Platts identified properties for sale in some sort of distressed circumstances, and he would enter into a contract to purchase the properties for a relatively modest amount. Prior to actually closing on the transactions, however, Platts located purchasers for the properties, who were typically in poor financial condition, had insufficient money to make a down payment, and were unsophisticated first-time home buyers.

As presented to the lenders, the buyers were purchasing the properties directly from the sellers, and the buyers were making substantial down payments associated with the purchase of the properties. Neither of those representations, however, was accurate.

Platts was paid through the payoff of Lis Pendens he had placed on the properties, which were often more than half of the true values of the properties. These Lis Pendens were essentially the difference between the true sales prices and the sales prices represented to the lenders.

Like Arakelian's scheme, Platts' scheme required drastically overstated sales prices because the loan amounts needed to pay the seller, Platts, and other kickbacks associated with the scheme. Moreno provided the fraudulent appraisals that mirrored the drastically overstated sales prices, leading the lenders to believe that their loans were collateralized by real estate worth much more than it was actually worth.

In terms of the Wire Fraud Scheme, there are a number of properties where Moreno was more than just an appraiser for the property. For example, there was a property located in Pittsburgh, Pa. Moreno negotiated to purchase the property, but prior to the closing, he arranged to sell the property to another buyer. The transaction was structured, however, to make it appear to the lender that Jason Moreno was not involved at all in the transaction, including failing to disclose a substantial payment to him at the closing. The transaction also involved a fake down payment, an undisclosed disbursement to the buyer of the property, and an egregiously fraudulent appraisal.

There were a number of other fraudulent deals involving Moreno himself, Moreno's fiance, his aunt, and his mother. All of these deals involved overstated sales prices, fake down payments, undisclosed disbursements to the buyers, and egregiously overstated appraisals. Another fraudulent transaction involved the purchase of a property by Daniel Hoey, Arakelian's brother-in-law. The settlement statement and other loan documents reflected the purchase of an $800,000 home in Sewickley, Pa., by Arakelian's wife, Samantha, which was financed by a $650,000 loan in which Samantha Arakelian made a substantial down payment associated with the closing. The reality, however, was that Hoey purchased the property for $441,000 and received $140,000 cash back, and neither he nor Samantha Arakelian made a down payment. In fact, Samantha Arakelian got $40,000 for the transaction. Moreno provided a fraudulently elevated appraisal that supported the fraudulently elevated $800,000 sales price, and another appraisal some months later related to a cash-out refinance associated with that same property.

Judge Fischer scheduled sentencing for Jan. 15, 2014. The law provides for a total sentence of 140 years in prison, a fine of $1,750,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based on the seriousness of the offenses and the criminal history, if any, of the defendant.

The Western Pennsylvania Mortgage Fraud Task Force conducted the investigation that led to the prosecution of Moreno. The lead investigator on the case was United States Secret Service Special Agent Keith Heckman.

PITTSBURGH - A Westmoreland County man has been sentenced in federal court to 252 months of imprisonment, 180 months of which will run concurrent with his state conviction, and 72 months of which will run consecutive to any state sentence, and was ordered to serve a lifetime term of supervised release on his conviction for production of material depicting the sexual exploitation of a minor, United States Attorney David J. Hickton announced today.

United States District Judge Mark R. Hornak imposed the sentence on Timothy Eugene Shearer, 55, formerly of Avonmore, Pa.

According to information presented to the court, from February of 2009 to September of 2009, and in or around October of 2006, Shearer persuaded, induced, and coerced a minor to engage in sexually explicit conduct, for the purpose of producing visual depictions of that conduct, namely a digital video and other images. The indictment also charged that Shearer possessed visual depictions, namely, digital image files and a video file, depicting minors engaging in sexually explicit conduct.

Assistant United States Attorney Jessica Lieber Smolar prosecuted this case on behalf of the government.

U.S. Attorney Hickton commended the Federal Bureau of Investigation and the Pennsylvania State Police for the investigation leading to the successful prosecution of Shearer.

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

PITTSBURGH - An individual found by the United States Citizenship and Immigration Service has been sentenced in federal court to 24 months on his conviction of false statement under oath in a proceeding or matter related to naturalization and re-entry into the United States after deportation, United States Attorney David J. Hickton announced today.

United States District Judge Mark R. Hornak imposed the sentence on Ernesto Ivan Lazo-Rodriguez, a/k/a Daniel Mancero, 35, formerly from El Salvador.

According to information presented to the court, Lazo-Rodriguez, an alien, was admitted to the United States as a permanent resident on Dec. 2, 1993. Under the alias of Daniel Mancero, Lazo-Rodriguez was arrested and convicted of Aggravated Robbery and Robbery by the State of Texas. Lazo-Rodriguez under the alias of Daniel Mancero, was removed from the United States by United States Immigration and Customs Enforcement on June 27, 2000. Lazo-Rodriguez ultimately returned to the United States and applied for naturalization. At his naturalization interview with U.S. Citizenship and Immigration Service on July 18, 2012, Lazo-Rodriguez denied ever being previously arrested and denied ever being previously removed or deported.

Assistant United States Attorney Shardul S. Desai prosecuted this case on behalf of the government.

U.S. Attorney Hickton commended the U.S. Immigration and Custom Enforcement for the investigation leading to the successful prosecution of Lazo-Rodriguez.

PITTSBURGH – A Mercer County resident has been indicted by a federal grand jury in Pittsburgh on charges of violating federal firearms and robbery laws, United States Attorney David J. Hickton announced today.

The three-count indictment named Joshua Stewart, 20, of Farrell, Pa.

According to the indictment, on Dec. 20, 2011, Stewart, together with another person, robbed the B&M Market, a convenience store located in Farrell. The robbers stole cash and cigarettes from the market. During the robbery, the robbers carried, used and discharged a firearm.

The law provides for a maximum sentence of not less than 10 years and up to life in prison, and a fine of up to $250,000. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.

Assistant United States Attorney Eric S. Rosen is prosecuting this case on behalf of the government.

The Federal Bureau of Investigation, the Southwest Mercer County Regional Police, and the Mercer County District Attorney’s Office conducted the investigation leading to the indictment in this case.

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

PITTSBURGH- A Beaver County man pleaded guilty in federal court to charges of violating various narcotic laws, United States Attorney David J. Hickton announced today.

Ryan John Konarski, 26, formerly of New Brighton, PA pleaded guilty to three counts before United States District Judge Nora Barry Fischer.

In connection with the guilty plea, the court was advised that from November 2010 to March 12, 2011, Konarski conspired with others to possess with intent to distribute the controlled substance analogue 3,4 methylenedioxymethcathinone, also commonly known as methylone,"bath salts" or "Molly." The government alleged that Konarski and Michael Stokes maintained a drug involved premises for purposes of distributing and using the analogue, while Stokes imported "Molly" into the United States from China.

Since drug suppliers have tried to avoid prosecution in the past by making minor changes in the chemical structures of controlled substances, Congress created the Controlled Substance Analogue Enforcement Act of 1986. This Act makes these chemically-altered "designer" drugs illegal if they are intended for human consumption and resemble a controlled substance in molecular structure as well as actual or purported physiological effects.

Judge Fischer scheduled sentencing for Jan. 16, 2014 at 9:00 AM. The law provides for a total sentence of 60 years in prison, a fine of $2,500,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offenses and the criminal history, if any, of the defendant.

Assistant United States Attorney Ross E. Lenhardt is prosecuting this case on behalf of the government.

The Drug Enforcement Administration and the New Brighton Police Department conducted the investigation that led to the prosecution of Konarski.

PITTSBURGH, Pa. - A Sewickley resident has been indicted by a federal grand jury in Pittsburgh on charges of health care fraud, United States Attorney David J. Hickton announced today.

The one count indictment named Mary Monica Wilson-Lefler, 62, as the defendant.

According to the indictment, Wilson was a salesperson who offered two durable medical equipment companies in the Pittsburgh area a business arrangement involving special air mattresses, known as powered pressure reducing mattresses or PPRAMS. PPRAMS are designed to reduce serious skin ulcers on patients who are essentially bedridden. She visited long term care (LTC) facilities to find patients, and handled all of the paperwork necessary to enable the DME companies to bill Highmark Blue Cross/Blue Shield's Security Blue Medicare Program (Security Blue). In order to qualify for Medicare coverage for these PPRAMS, a doctor must order the item in writing. In this case, Wilson prepared and sent by fax to attending physicians requests for orders for the PPRAMS. The faxed information included patient skin condition reports that falsely reported that the patients all had serious skin ulcers. Some of the these patient skin condition reports contained forged signatures of the LTC staff and some had forged signatures of physicians. In reality, none of the patients had serious skin ulcers or any other qualifying conditions that would meet the Medicare coverage requirements. There were about 83 patients from four facilities in whose names the false claims were made. The total billed was approximately $400,000, and the total paid to the two DME companies was about $200,000.

The law provides for a maximum sentence of 10 years in prison and a $250,000 fine or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendants.

Assistant United States Attorney Nelson P. Cohen is prosecuting this case on behalf of the government.

The Federal Bureau of Investigation and the United States Food and Drug Administration, Office of Criminal Investigations conducted the investigation leading to the indictment in this case.

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

PITTSBURGH - Following the beginning of a new school year, U.S. Attorney David J. Hickton today focused public attention on the office’s School Corruption Hotline, 412-894-7515. The hotline number rings directly in the U.S. Attorney’s Office where callers may leave their name, contact information, and details regarding suspected misuse of tax dollars supporting education.

“The advent of a new school year provides the opportunity to remind citizens that they are a vital resource in helping us identify fraud and illegal activity within the school system,” said U.S. Attorney Hickton. “We need the public to continue to provide information regarding suspected abuses, including misuse of district education funds, theft, spending irregularities, corruption in the contract and bidding process, and bribery, kickbacks or other forms of collusion with outside vendors.”

U.S. Attorney Hickton encouraged callers to be as specific as possible when leaving information so that the appropriate investigating agency, Federal Bureau of Investigation, IRS - Criminal Investigation, Department of Education - Office or Inspector General, or others, are able to pursue leads.

U.S. Attorney Hickton activated the first-of-its-kind hotline in November 2011. Dozens of callers have provided information resulting in several open and ongoing investigations.

The Western District of Pennsylvania encompasses 25 counties in the westernmost part of the Commonwealth: Allegheny. Armstrong, Beaver, Butle, Clarion, Fayette, Greene, Indiana, Jefferson, Lawrence, Mercer, Washington, and Westmoreland in the Greater Pittsburgh area; Crawford, Elk, Erie, Forest, McKean, Venango and Warren in the Erie area; and Bedford, Blair, Cambria, Clearfield and Somerset in the Johnstown area.

JOHNSTOWN, Pa. - A resident of Johnstown, Pa., pleaded guilty in federal court to charges of violating federal narcotics and firearms laws, United States Attorney David J. Hickton announced today.

Che Rose, 27, pleaded guilty to two counts before United States District Judge Kim R. Gibson.

In connection with the guilty plea, the court was advised that on Sept. 10, 2009, Rose possessed less than five grams of cocaine base, commonly known as "crack," with the intent to distribute it.

Further, on the same date Rose, who had been convicted in 2005 in Cambria County, Pa., of Drug Act Violation/delivery-possession with the intent to deliver a controlled substance unlawfully possessed an H & R revolver. Federal law prohibits persons who have been convicted of a crime punishable by imprisonment for more than one year from possessing ammunition or firearms. Drug Act Violation/delivery-possession with intent to deliver a controlled substance is such a crime.

Judge Gibson scheduled sentencing for Feb. 6, 2014, at 11 a.m. The law provides for a total sentence of 30 years in prison, a fine of $1,250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offenses and the criminal history of the defendant.

Assistant United States Attorney John J. Valkovci, Jr., is prosecuting this case on behalf of the government.

The Johnstown Police Department, the Cambria County Drug Task Force and the Laurel Highlands Resident Agency of the Federal Bureau of Investigation conducted the investigation that led to the prosecution of Rose.

According to Mr. Hickton, Rose is being prosecuted as part of Project Safe Neighborhoods, a collaborative effort by federal, state, and local law enforcement agencies, prosecutors, and communities to prevent, deter, and prosecute gun crime.

PITTSBURGH - A former United States Drug Enforcement Administration (DEA) employee was sentenced today in federal court to one year probation with 50 hours of community service on her conviction of theft of government property, United States Attorney David J. Hickton announced today.

Senior United States District Judge Donetta W. Ambrose imposed sentence upon Holly A. Cook, 44, of Monongahela, PA.

According to information presented to the court, in June 2012, Cook embezzled to her own use $1,800 in cash of the DEA, monies to which she knew she was not entitled.

Prior to imposing sentence, Judge Ambrose took into consideration the defendant's lack of a criminal history, her early acceptance of responsibility and her full repayment of the $1,800 embezzled by her.

Assistant United States Attorney Mary McKeen Houghton prosecuted this case on behalf of the government.

U.S. Attorney Hickton commended the Special Agents of the United States Department of Justice, Office of the Inspector General, who conducted the investigation that led to the successful prosecution of Cook.

PITTSBURGH, Pa. - A resident of Sewickley, Pa., has been sentenced in federal court to two years probation on her conviction of identity theft, United States Attorney David J. Hickton announced today.

United States District Judge Donetta W. Ambrose imposed the sentence on Anastacia Benedict, 24.

According to the information presented to the court, Benedict, a participant in an identity theft scheme, attempted to use unauthorized retail store charge cards to make purchases of merchandise.

Assistant United States Attorney Gregory C. Melucci prosecuted this case on behalf of the government.

The Western Pennsylvania Financial Crimes Task Force (WPFCTF) conducted the investigation that led to the prosecution in this case. The WPFCTF was established in February 1995 as a collaborative, multi-agency effort to effectively combat financial crimes, including identity fraud, in Western Pennsylvania. Partners in this effort are the United States Attorney's Office for the Western District of Pennsylvania, the United States Secret Service, the United States Postal Inspection Service, the Department of Homeland Security, the Allegheny County District Attorney's Office, the Allegheny County Police Department, the City of Pittsburgh Bureau of Police and the Pennsylvania State Police.

PITTSBURGH, Pa. - A resident of McKees Rocks, Pa., has been sentenced in federal court to probation for a term of three years with six months home detention to include electronic monitoring on her conviction of identity theft, United States Attorney David J. Hickton announced today.

United States District Judge Donetta W. Ambrose imposed the sentence on Sonya Smith, 26.

According to the information presented to the court, Smith, a former customer service representative for PNC Bank, provided PNC customer account information to another person which was later used to open fraudulent credit accounts.

Assistant United States Attorney Gregory C. Melucci prosecuted this case on behalf of the government.

The Western Pennsylvania Financial Crimes Task Force conducted the investigation that led to the prosecution in this case. The WPFCTF was established in February 1995 as a collaborative, multiagency effort to effectively combat financial crimes, including identity fraud, in Western Pennsylvania. Partnering in this effort is the United States Attorney's Office for the Western District of Pennsylvania, the United States Secret Service, the United States Postal Inspection Service, the Department of Homeland Security, the Allegheny County District Attorney's Office, the Allegheny County Police Department, the City of Pittsburgh Bureau of Police and the Pennsylvania State Police.

JOHNSTOWN, Pa. - A resident of Waynesboro, Pa., pleaded guilty in federal court to a charge of conspiracy to distribute cocaine, United States Attorney David J. Hickton announced today.

Kenneth Biser, 59, pleaded guilty to one count before United States District Judge Kim R. Gibson.

In connection with the guilty plea, the court was advised that Biser conspired to possess and distribute 500 grams or more of cocaine from Nov. 2011 to July 18, 2012.

Judge Gibson scheduled sentencing for February 6, 2014, at 10 a.m. The law provides for a total sentence of 40 years in prison, a fine of $5,000,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the criminal history, if any, of the defendant.

Pending sentencing, the court continued Biser on bond.

Assistant United States Attorney John J. Valkovci, Jr., is prosecuting this case on behalf of the government.

The Safe Streets Task Force initiative comprised of the Laurel Highlands Resident Agency of the Federal Bureau of Investigation, the Pa. Attorney General's Office, the Blair County Drug Task Force, the Cambria County Drug Task Force, the Somerset County Drug Task Force, the Roaring Spring Borough Police Dept. and the Paint Township Police Dept. conducted the investigation that led to the prosecution of Biser.

JOHNSTOWN, Pa. - A resident of Ebensburg, Pa., was sentenced in federal court to 12 months plus one day in prison and three years supervised release, on her conviction of conspiracy, United States Attorney David J. Hickton announced today.

United States District Judge Kim R. Gibson imposed the sentence on Roxanne Lamer, 46.

According to information presented to the court, from June 9, 2007, to April 15, 2008, Lamer conspired with others to defraud the United States by assisting a co-conspirator in concealing money from the Internal Revenue Service in order for the co-conspirator to avoid paying income tax.

Assistant United States Attorney Stephanie L. Haines prosecuted this case on behalf of the government.

Mr. Hickton commended the Federal Bureau of Investigation, the Internal Revenue Service Criminal Investigation and the Ebensburg Borough Police Department for the investigation leading to the successful prosecution of Lamer.

Prosecution is Part of Project Safe Neighborhoods Initiative

JOHNSTOWN, Pa. - A resident of Ebensburg, Pa., was sentenced in federal court to 21 months in prison, three years supervised release and ordered to pay restitution in the amounts of $125,977 to the Internal Revenue Service and $390,544 to the Estate of Edward R. Szuch, on his conviction of conspiracy and violating federal firearms laws, United States Attorney David J. Hickton announced today.

United States District Judge Kim R. Gibson imposed the sentence on David Eugene Lamer, 47.

According to information presented to the court, from June 9, 2007, to Apr. 15, 2008, Lamer conspired with others to defraud the United States by concealing money from the Internal Revenue Service in an effort to avoid paying income taxes. Also, on Sept. 2, 2010, Lamer possessed a FIE, Model Standard .38 caliber pistol, and on Sept. 3, 2010, Lamer possessed a Remington, Model 760, .30-06 caliber rifle, a Marlin, Model 1894, .357 caliber rifle, and a Savage/Stevens (Western Field) Model 30, 16 gauge shotgun. On Jan. 8, 1986, Lamer was convicted in Cambria Co., Pa., of burglary, which is a crime punishable by imprisonment for a term exceeding one year. Federal law prohibits persons who have been convicted of a crime punishable by a term of imprisonment exceeding one year from possessing firearms or ammunition.

Assistant United States Attorney Stephanie L. Haines prosecuted this case on behalf of the government.

According to Mr. Hickton, this case was prosecuted as part of the Project Safe Neighborhoods initiative, a collaborative effort by federal, state, and local law enforcement, agencies, prosecutors and communities to prevent, deter and prosecute gun crime.

Mr. Hickton commended the Federal Bureau of Investigation, the Internal Revenue Service Criminal Investigation and the Ebensburg Borough Police Department for the investigation leading to the successful prosecution of Lamer.

JOHNSTOWN, Pa. - United States Attorney David J. Hickton announced today that an inmate at the Federal Correctional Institution at Loretto, Pa., pleaded guilty in federal court to a charge of possession of heroin in prison. He was then sentenced to twelve months plus one day consecutive to the 351 months sentence he is currently serving for conspiracy to commit robbery, attempt to commit robbery, and use of a firearm during and in relation to criminal violence.

United States District Judge Kim R. Gibson imposed the sentence on Carlos Alberto Prieto, 48.

In connection with the guilty plea, on Mar. 19, 2013, Prieto was in possession of heroin.

Assistant U.S. Attorney Stephanie L. Haines prosecuted this case on behalf of the government.

U.S. Attorney Hickton commended the Laurel Highlands Resident Agency of the Federal Bureau of Investigation and the Federal Correctional Institution, Special Investigative Staff, for the investigation leading to the successful prosecution of Prieto.

PITTSBURGH - An illegal alien found in Cranberry Twp., Pa., has been sentenced in federal court to time-served on his conviction of re-entry into the United States after deportation, United States Attorney David J. Hickton announced today.

United States District Judge Nora Barry Fischer imposed the sentence on Olvin Joel Dominguez-Maldanod, 26, of Honduras.

According to information presented to the court, Dominguez-Maldanod, an alien, was removed from the United States by United States Immigration and Customs Enforcement on Jan. 24, 2013. Dominguez-Maldanod, was found on July 25, 2013 in Cranberry Twp.

Assistant United States Attorney Shardul S. Desai prosecuted this case on behalf of the government.

U.S. Attorney Hickton commended the U.S. Immigration and Custom Enforcement for the investigation leading to the successful prosecution of Dominguez-Maldanod.

JOHNSTOWN, Pa. – A resident of Johnstown, Pa., pleaded guilty in federal court to a charge of possession with the intent to distribute cocaine base, commonly known as "crack," United States Attorney David J. Hickton announced today.

Ebony R. Thorne, 30, pleaded guilty to one count before United States District Judge Kim R. Gibson.

In connection with the guilty plea, the court was advised that on Oct. 31, 2012, Thorne possessed less than 28 grams of cocaine base with the intent to distribute it.

Judge Gibson scheduled sentencing for Feb. 4, 2014, at 11 a.m. The law provides for a total sentence of 20 years in prison, a fine of $1,000,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the criminal history, if any, of the defendant.

Assistant United States Attorney John J. Valkovci, Jr., is prosecuting this case on behalf of the government.

The Laurel Highlands Resident Agency of the Federal Bureau of Investigation and the Cambria County Drug Task Force conducted the investigation that led to the prosecution of Thorne.

PITTSBURGH, Pa. - A Beaver County resident has been indicted by a federal grand jury in Pittsburgh on a charge of union embezzlement, United States Attorney David J. Hickton announced today.

The one-count indictment named David L. Barr, 50, as the sole defendant.

According to the indictment, David L. Barr, while a Financial Secretary-Treasurer of the Local No. 99 of the Glass, Molders, Pottery, Plastics & Allied Workers International Union, AFL-CIO, CLC, stole approximately $5,688.40 from the union by cashing 19 employer dues remittance checks belonging to the labor organization and converting the monies to his own personal use during the period from April 9, 2010 through Sept. 22, 2011.

The law provides for a maximum total sentence of five years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.

Assistant United States Attorney Mary McKeen Houghton is prosecuting this case on behalf of the government.

The Department of Labor, Office of Labor Management Standards, conducted the investigation leading to the indictment in this case.

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

JOHNSTOWN, Pa. - A resident of Johnstown, Pa., has been sentenced in federal court to three years probation, the first eight months of which must be served by conditions of home confinement, on her conviction of making false statements to a federally licensed firearms dealer, United States Attorney David J. Hickton announced today.

United States District Judge Kim R. Gibson imposed the sentence on Kimberly G. Yarnavick, 48.

According to information presented to the court, on July 15, 2009, in conjunction with the purchase of a Hi Point pistol; on Feb. 5, 2010, in conjunction with the purchase of a Phoenix pistol; and on March 3, 2010, in conjunction with the purchase of a American Arms pistol, Yarnavick knowingly made false statements in an effort to deceive Sporting Goods Discounters, a federally licensed firearms dealer. Yarnavick represented she was the actual buyer of the firearms when, in fact, she was purchasing the firearms on behalf of another person.

Assistant United States Attorney John J. Valkovci, Jr., prosecuted this case on behalf of the government.

U.S. Attorney Hickton commended the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Johnstown Police Department for the investigation leading to the successful prosecution of Yarnavick.

According to Mr. Hickton, Yarnavick was prosecuted as part of Project Safe Neighborhoods, a collaborative effort by federal, state, and local law enforcement agencies, prosecutors, and communities to prevent, deter, and prosecute gun crime.

JOHNSTOWN, Pa. – A resident of Johnstown, Pa., pleaded guilty in federal court to a charge of distribution of a controlled substance, United States Attorney David J. Hickton announced today.

Nieves Calderon, III, 36, pleaded guilty to one count before United States District Judge Kim R. Gibson.

In connection with the guilty plea, the court was advised that on Nov. 19, 2012, Calderon distributed a quantity of alprazolam.

Judge Gibson scheduled sentencing for Jan. 9, 2014, at 11 a.m. The law provides for a total sentence of five years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the criminal history, if any, of the defendant.

Assistant United States Attorney John J. Valkovci, Jr., is prosecuting this case on behalf of the government.

The Laurel Highlands Resident Agency of the Federal Bureau of Investigation and the Cambria County Drug Task Force conducted the investigation that led to the prosecution of Calderon.

PITTSBURGH, Pa. - The former CEO of the Pennsylvania Cyber Charter School and his accountant have been indicted by a federal grand jury in Pittsburgh on charges of mail fraud, theft or bribery concerning a program receiving federal funds, tax conspiracy and filing a false tax return. The announcement was made today at a news conference by United States Attorney David J. Hickton; FBI Special Agent in Charge Gary Douglas Perdue; Akeia Conner, Special Agent in Charge of the IRS-Criminal Investigation - Philadelphia Field Office; and Steven Anderson, Special Agent in Charge, Department of Education Office of Inspector General - Mid Atlantic Region.

The 11-count indictment, returned on Aug. 21, and unsealed today, named Nicholas Trombetta, 58, of East Liverpool, Ohio, and Neal Prence, 58, of Koppel, Pa.

According to the indictment, Trombetta was the founder and Superintendent of the PA Cyber Charter School. Trombetta created a series of connected for-profit and not-for-profit entities to siphon taxpayer funds out of PA Cyber and to avoid federal income tax liabilities. The indictment alleges that Prence, an accountant, assisted Trombetta in the tax fraud scheme.

“As the founder and CEO of PA Cyber, Trombetta was a custodian of the public trust, receiving public funds,” said U.S. Attorney Hickton. “These charges reflect our obligation to protect the education of children, who are our future, and to protect the compact with hardworking taxpayers.”

“Charter schools are funded with public money that is intended to help educate children in our communities,” stated FBI SAC Perdue. “When individuals enrich themselves with this money rather than act as stewards of the education funds entrusted to them, our communities and the children we are obligated to educate are the true victims.”

“During a six-year period that began in 2006, Mr. Trombetta with the assistance of CPA Prence, concealed his position as the direct beneficiary and recipient of funds generated by PA Cyber,” said IRS-CI SAC Conner. “Mr. Trombetta exerted his influence to control the flow of funds and falsify corporate books and records, ultimately shifting more than $8 million in income attributable to him, to the federal income tax returns of other persons so as to conceal his true income from the IRS. The government must hold corporations and their executives accountable for their actions. It is for this reason that IRS Criminal Investigation continues to vigorously pursue corporate fraud and those individuals who employ illegal accounting practices for personal financial gain.”

"Mr. Trombetta and Mr Prence knowingly and willfully abused their positions of trust for personal gain and did so at the expense of the educational development of children. That is unacceptable," said Steven Anderson, Special Agent in Charge of the U.S. Department of Education Office of Inspector General's Mid-Atlantic Regional Office. "Deservedly, Mr. Trombetta and Mr. Prence will now be held accountable for cheating Pennsylvania’s students."

The law provides for a maximum total sentence of 100 years in prison, a fine of $3,250,000, or both for Trombetta and five years imprisonment, $250,000, or both for Prence. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.

Assistant United States Attorneys James R. Wilson, Robert S. Cessar and Stephen R. Kaufman are prosecuting this case on behalf of the government.

The Federal Bureau of Investigation, the Internal Revenue Service - Criminal Investigations and the U.S. Department of Education Office of Inspector General conducted the investigation leading to the indictment in this case.

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

JOHNSTOWN, Pa. – A resident of Windber, Pa., pleaded guilty in federal court to a charge of kidnapping, United States Attorney David J. Hickton announced today.

Lawrence R. Horner, III, 37, pleaded guilty to one count before United States District Judge Kim R. Gibson.

In connection with the guilty plea, the court was advised that on July 9, 2011, Horner kidnaped a person whose identity is known and referred to as "L.N.," and did willfully travel and transport L.N. in interstate commerce in commission of the kidnaping offense.

Judge Gibson scheduled sentencing for Jan. 7, 2014, at 11 a.m. The law provides for a total sentence of life in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the criminal history, if any, of the defendant.

Assistant United States Attorney John J. Valkovci, Jr., is prosecuting this case on behalf of the government.

The Richland Township Police Department and the Laurel Highlands Resident Agency of the Federal Bureau of Investigation conducted the investigation that led to the prosecution of Horner.

PITTSBURGH, Pa. - A Fox Chapel resident pleaded guilty in federal court to charges of unlawful importation of prescription drugs, United States Attorney David J. Hickton announced today.

Robin W. Simon, 45, pleaded guilty to two counts before United States District Judge Arthur J. Schwab.

In connection with the guilty plea, the court was advised that in July of 2007 Simon unlawfully imported the anti-cancer prescription drug known as "Xeloda" from Lisbon, Portugal. Simon had purchased the Xeloda from United Drug Wholesalers, which is based in Ireland, and directed United Drug to send those drugs to her in Portugal. In September of 2008, Simon unlawfully imported Xeloda from Heathrow Healthcare, Limited, which is based in Hounslow, Great Britain. The Xeloda tablets which Simon unlawfully imported from Portugal and Great Britain had been manufactured by Roche Laboratories in New Jersey. Simon then caused those medications to be dispensed to persons who presented prescriptions for Xeloda to the Stanton-Negley Pharmacy, which is located on North Negley Avenue in Pittsburgh.

Judge Schwab scheduled sentencing for Dec. 20, 2013, at 9:30 a.m. The law provides for a total sentence of 30 years in prison, a fine of $500,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offenses and the criminal history, if any, of the defendant.

Assistant United States Attorney Shaun E. Sweeney is prosecuting this case on behalf of the government.

The United States FDA-Office of Criminal Investigations, the United States Department of Health and Human Services Office of Inspector General, the Department of Homeland Security, the Federal Bureau of Investigation and the United States Postal Inspection Service conducted the investigation that led to the prosecution of Simon.

ERIE, Pa. - A former resident of Erie, Pennsylvania has been sentenced in federal court to 145 months in jail, 15 years supervised release and ordered to make $5,000 in restitution on his conviction of violating federal laws relating to the sexual exploitation of children, United States Attorney David J. Hickton announced today.

United States District Judge David S. Cercone imposed the sentence on Michael Vay Daratany, 36.

According to information presented to the court, Daratany distributed and possessed computer images and movies depicting minors engaging in sexually explicit conduct. Many of the images and movies found on Daratany's computer equipment depicted the sexual abuse of infants and toddlers.

Prior to imposing sentence, Judge Cercone stated that this was a very serious offense deserving of a significant sentence.

Assistant United States Attorney Christian A. Trabold prosecuted this case on behalf of the government.

U.S. Attorney Hickton commended the Federal Bureau of Investigation, the Pennsylvania State Police and the Charlottesville, Virginia Police Department for the investigation leading to the successful prosecution of Daratany.

Launched in February 2006, Project Safe Childhood is a nationwide initiative designed to protect children from online exploitation and abuse. Led by the U.S. Attorneys' Offices, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.

ERIE, Pa. - An inmate at the McKean Federal Correctional Institution in Bradford, Pennsylvania pleaded guilty and was sentenced in federal court to 1 month incarceration on his conviction for possession of contraband in prison, United States Attorney David J. Hickton announced today.

United States District Judge David S. Cercone imposed the sentence on Franklin Rodriguez, 43. The sentence was imposed to run consecutively to the sentence Rodriguez is currently serving.

According to information presented to the court on December 24 ,2012, Rodriguez was in possession of contraband, namely a cell phone.

Assistant United States Attorney Christian A. Trabold prosecuted this case on behalf of the government.

U.S. Attorney Hickton commended Officers of the McKean Federal Correctional Institution for the investigation leading to the successful prosecution of Rodriguez.

ERIE, Pa. - An inmate at the McKean Federal Correctional Institution in Bradford, Pennsylvania pleaded guilty and was sentenced in federal court to 18 months incarceration on his conviction for possession of contraband in prison, United States Attorney David J. Hickton announced today.

United States District Judge David S. Cercone imposed the sentence on Antonio Lattin, 28. The sentence was imposed to run consecutively to the sentence Lattin is currently serving.

According to information presented to the court on December 1, 2012, Lattin was in possession of a weapon.

Assistant United States Attorney Christian A. Trabold prosecuted this case on behalf of the government.

U.S. Attorney Hickton commended Officers of the McKean Federal Correctional Institution for the investigation leading to the successful prosecution of Lattin.

PITTSBURGH, Pa. - The owners of a Wilkinsburg convenience store have pleaded guilty to charges of conspiracy to commit wire fraud and food stamp fraud, United States Attorney David J. Hickton announced today.

Nicole Gordon, 34, and Stanley Saxton, 44, siblings and co-owners and operators of Nicky's Corner, located on Montier Street in Wilkinsburg, Pa., each pled guilty to one count of conspiracy before Senior District Judge Maurice B. Cohill, Jr. Gordon and Saxton also executed civil settlement agreements for violations of the False Claims Act, and agreed to pay to the United States the sum of $119,871.

According to information presented to the court, Nicky's Corner participated in the United States Department of Agriculture's Supplemental Nutrition Assistance Program, commonly known as the food stamp program. Food stamp recipients could purchase eligible food items using food stamp benefit cards at the store. As a condition of participation in the food stamp program, the defendants certified that they would comply with all rules and regulations of the program and were aware that program rules strictly prohibited the exchange of food stamp benefits for cash and/or for ineligible items, such as cigarettes. Despite this knowledge, on multiple occasions, the defendants exchanged food stamp benefits with customers in exchange for cash on a discounted basis, usually giving the customers only 50 cents on the dollar for their food stamp benefits. Gordon and Saxton also permitted customers to use food stamp benefits to pay for ineligible items, such as cigarettes.

Judge Cohill scheduled sentencing for Dec. 4, 2013 at 10 a.m. for Saxton and 11 a.m. for Gordon. The law provides for a maximum total sentence of five years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal histories, if any, of the defendants.

Assistant United States Attorney Tonya Sulia Goodman is prosecuting this case on behalf of the Criminal Division of the U.S. Attorney's Office and Assistant United States Attorney Colin Callahan is litigating the case on behalf of the Affirmative Civil Enforcement Section of the United States Attorney's Office.

The Office of the Inspector General for the United States Department of Agriculture and the Department of Homeland Security, Immigration and Customs Enforcement conducted the investigation leading to the guilty pleas in this case.

PITTSBURGH, Pa - A Beaver County resident has been sentenced in federal court to 78 months of imprisonment, to be followed by five years of supervised release, on his conviction of conspiracy and money laundering, United States Attorney David J. Hickton announced today.

United States District Judge Cathy Bissoon imposed the sentence on Jeffrey Garbinski, 45. Judge Bissoon also ordered Garbinski to pay approximately $3 million in restitution, including $350,000 he defrauded from his own parents.

According to information presented to the court, Garbinski owned and operated the Closing Company of PA ("Closing Company"), which closed residential real estate transactions. Sabrina Spetz was an attorney who closed many of the transactions at issue. Garbinski also operated a mortgage broker business called Main Street Mortgage Services, which did business as Asset Mortgage and Financial Services, Inc., and he was a title insurance agent.

Closing companies have trust accounts. What is supposed to happen is that the money from the lenders funding the loans goes into the trust account. At or shortly after the closing, those funds are disbursed consistent with the lender's instructions and the settlement statements. Most significantly with regard to this case, is that liabilities associated with the collateral are supposed to be paid immediately. Thus, the liens related to the property are paid and the lender stands in first lien position.

Rather than immediately paying the liabilities, Garbinski, with Spetz's knowledge and assistance, siphoned money from the company for years to support his lifestyle and for other business ventures. He would then use the money from the next transactions to pay the liabilities from the previous transactions. He paid the monthly mortgage payments on the outstanding mortgages that should have already been paid to avoid discovery of his fraud. Eventually, the liabilities grew so large that Garbinski was no longer able to pay the liabilities and he filed for bankruptcy.

Although Garbinski committed this scheme regarding customers of the Closing Company, he also committed this scheme with his own personal residence. Dollar Bank funded a $600,000 loan to Garbinski arranged through his mortgage broker business and closed by the Closing Company, and funded by Dollar Bank. Basically, the loan through Dollar Bank was a typical refinance transaction in which all of the liabilities associated with the collateral, which was Garbinski's personal residence, were supposed to be paid off. Garbinski submitted a loan application that failed to report two significant mortgages on the property, and he also arranged to submit fraudulent title search records that did not reveal the two mortgages. Long after the loan closed, Dollar Bank discovered that they were in third lien position rather than first lien position.

Ultimately, the title insurance companies paid substantial claims because of this fraud. The Closing Company was a representative of Stewart Title Guaranty Company and Fidelity National Title Insurance Company ("Fidelity"). Fidelity conducted an audit of the Closing Company of PA pursuant to the title insurance contract between Fidelity and the Closing Company. As part of that audit, Fidelity requested and obtained from Spetz bank statements that did not show the fraudulent withdrawals because the statements had been altered by Spetz at Garbinski's direction.

In terms of the money laundering, an owner of a home sought to refinance a loan through Northwest Savings Bank. Because of concerns that Northwest had with Garbinski, Northwest refused to let the Closing Company close the transaction, and demanded that Fidelity close the transaction. Fidelity, however, was unaware of the transaction and did not close the loan. In order to make it appear that Fidelity was involved in closing the loan, the settlement statement was fabricated and provided to Northwest. The settlement statement falsely represented that Fidelity closed the transaction. In addition, Garbinski created a letter with wiring information for what was represented to be the trust account for Fidelity. In fact, the account number is for the Closing Company. The loan closed on Feb. 24, 2010, and the loan was funded through a wire transfer from Northwest Savings Bank to the Citizens Bank account of the Closing Company. That money was supposed to have been used to pay off a liability associated with the collateral.

On Feb. 25, 2010, Garbinski withdrew $38,316 in cash from that account. Bank surveillance pictures showed Garbinski making the withdraw. On that same day, Garbinski deposited $37,500 of that cash into the Clearview Federal Credit Union account of JAG Management LP, which was basically a shell company that Garbinski owned.

Assistant United States Attorney Brendan T. Conway prosecuted this case on behalf of the government.

The Mortgage Fraud Task Force conducted the investigation that led to the prosecution of Garbinski. The Mortgage Fraud Task Force is comprised of investigators from federal, state and local law enforcement agencies and others involved in the mortgage industry. Federal law enforcement agencies participating in the Mortgage Task Force include the Federal Bureau of Investigation; the Internal Revenue Service, Criminal Investigations; the United States Department of Housing and Urban Development, Office of Inspector General; the United States Postal Inspection Service; and the United States Secret Service. Other Mortgage Fraud Task Force members include the Allegheny County Sheriff's Office; the Pennsylvania Attorney General's Office, Bureau of Consumer Protection; the Pennsylvania Department of Banking; the Pennsylvania Department of State, Bureau of Enforcement and Investigation; and the United States Trustee's Office.

PITTSBURGH, Pa. - A Pittsburgh man has been sentenced in federal court to one month imprisonment with three years supervised release on his conviction of violating federal counterfeit laws, United States Attorney David J. Hickton announced today.

United States District Judge Mark R. Hornak imposed the sentence on Dustin Mathis, 30.

According to information presented to the court, Mathis did possess and conceal falsely made, forged, counterfeited and altered obligations of the United States, that is, approximately $1,840 in counterfeited Federal Reserves Notes, with the intent to defraud.

Assistant United States Attorney Shardul S. Desai prosecuted this case on behalf of the government.

U.S. Attorney Hickton commended the U.S. Secret Service for the investigation leading to the successful prosecution of Mathis.

PITTSBURGH, Pa. - Two Donora residents pleaded guilty in federal court to a charge of conspiracy, United States Attorney David J. Hickton announced today.

Kayla Doree Willis, 22, and Takeisha Lynn Martin, 22, pleaded guilty to one count before Senior United States District Judge Gustave Diamond.

In connection with the guilty plea, the defendants admitted accepting UPS packages containing stolen credit cards, which were later used to purchase merchandise.

Judge Diamond scheduled Willis' sentencing for Dec. 10, 2013 at 10 a.m., and Martin's sentencing for Dec. 10, 2013 at 11 a.m. The law provides for a maximum total sentence of not more than 5 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.

Assistant United States Attorney Gregory C. Melucci is prosecuting this case on behalf of the government.

The Western Pennsylvania Financial Crimes Task Force (WPFCTF), conducted the investigation that led to the successful prosecution of Willis and Martin. The WPFCTF was established as a collaborative, multi-agency effort to effectively combat financial crimes, including identity fraud, in Western Pennsylvania. Partnering in this effort are the United States Attorney's Office for the Western District of Pennsylvania, the United States Secret Service, the United States Postal Inspection Service, the Department of Homeland Security, the Allegheny County District Attorney's Office, the Allegheny County Police Department, the City of Pittsburgh Bureau of Police and the Pennsylvania State Police.

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

PITTSBURGH, Pa. - A Jeannette man has been indicted by a federal grand jury in Pittsburgh on charges of mail fraud and wire fraud, United States Attorney David J. Hickton announced today.

The six-count indictment named Derek A. Candelore, aka Dan Kun, aka Kevin Kelly, 33, as the sole defendant.

According to indictment, Candelore was employed by Penn-Star Energy, LLC of Butler County ( Penn-Star), as a landman. Candelore worked at Penn-Star with another landman identified in the indictment as WJR. A landman contacts mineral rights owners on behalf of natural gas production companies to arrange for leases of mineral interests for oil and gas production. Penn-Star acquired mineral rights on behalf of Range Resources Corporation. The mineral rights for four separate blocks of land in Washington County, consisting of 100 or more acres, were stolen by Candelore using forged signatures, fake companies and forged notary signatures and stamps. These frauds began in February 2010 and ended in June 2012. During the scheme Candelore set up several post office boxes and bank accounts in the names of companies he created. He filed deeds and other documents at the Washington County Recorder of Deeds Offices to make it appear that the true mineral rights owners had transferred their mineral rights to Candelore's fake companies. These deeds had forged signatures of several true owners and forged notary signatures and stamps. Candelore's companies thereafter leased and/or sold the mineral rights to others. The indictment seeks the forfeiture of $1,177,735.27 of proceeds from the scheme. Candelore received the proceeds from each of the four blocks of mineral rights, while WJR received proceeds from two of the four. The victims include Range Resources Corporation, several mineral rights owners, Pecos Bend Royalties, LP, of Midland Texas, and Buffalo Royalties business entities in Texas.

The law provides for a maximum total sentence of 120 years in prison, a fine of $1,500,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.

Assistant United States Attorney Nelson P. Cohen is prosecuting this case on behalf of the government.

The U.S. Postal Inspection Service conducted the investigation leading to the indictment in this case.

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

PITTSBURGH, Pa. - A resident of North Huntingdon, Pa. has been sentenced in federal court to three years of probation; eight months of home detention with electronic monitoring; restitution of $14,639.86, and he has been ordered to pay a fine of $10,000 on his conviction of mail fraud, witness tampering and false statements to the government, United States Attorney David J. Hickton announced today.

United States District Judge Terrence F. McVerr y imposed the sentence on Danny A. Patel, 46.

According to information presented to the court, Patel managed a BP gas station in McKeesport, Pa. Patel submitted false insurance claims to Harleysville Insurance Company arising from a December 25, 2011 accident at the BP. Patel also admitted that he lied to FBI agents and obstructed justice by asking witnesses to lie to FBI agents.

Assistant United States Attorney Robert S. Cessar prosecuted this case on behalf of the government.

U. S. Attorney Hickton commended the Federal Bureau of Investigation for the investigation leading to the successful prosecution of Patel.

PITTSBURGH, Pa. - A resident of Harrison City, Pa., has been sentenced in federal court to five years imprisonment and four years supervised release, and ordered to pay a $17,500 fine, on his conviction of violating the federal narcotics laws, United States Attorney David J. Hickton announced today.

United States District Judge Joy Flowers Conti imposed the sentence on Kevin Nicol, 58.

According to information presented to the court, Nicol was involved in a conspiracy to distribute more than 50 grams of methamphetamine. The parties stipulated that 279.2 grams of "ice," also known as pure methamphetamine, were attributable to Nicol for purposes of the Sentencing Guidelines.

Prior to imposing sentence, Judge Conti stated that this was a very serious offense, and noted that the methamphetamine was over 94% pure.

Assistant United States Attorney Stephen R. Kaufman prosecuted this case on behalf of the government.

U.S. Attorney Hickton commended the Drug Enforcement Administration and the Pennsylvania State Police for the investigation leading to the successful prosecution of Nicol.

PITTSBURGH, Pa. - A Maryland resident has been sentenced in federal court to 27 months imprisonment, to be followed by three years of supervised release, on his conviction of conspiracy to transport stolen motor vehicles across state lines, United States Attorney David J. Hickton announced today.

United States District Judge Terrence F. McVerry imposed the sentence on Rodney D. Deminds, Jr., 24, of Belcamp, Md.

According to information presented to the court, on at least 14 occasions between July of 2011 and April of 2012, Deminds, along with Harvey Leemore, Collin D. Powell and Trea C. Powell, and at least one other individual, traveled from Baltimore to various retail dealerships in Pennsylvania and Virginia for the purpose of stealing motorcycles and tractors from those retail dealerships. After stealing these items, the thieves took the items back to Baltimore and sold them. The items were stolen from retail dealerships located in Gibsonia, Ebensburg, Gaines and Altoona, Pa., and in Purcellville, Va. The value of the stolen items exceeded $200,000.

Assistant United States Attorney Shaun E. Sweeney prosecuted this case on behalf of the government.

U.S. Attorney Hickton commended the Pennsylvania State Police, Western Pennsylvania Auto Theft Task Force, the Federal Bureau of Investigation, and detectives from Harford County, Maryland, for the investigation leading to the successful prosecution of Deminds.

ERIE, Pa. - A former resident of Pensacola, Florida, has been sentenced in federal court to 135 months in prison and ordered to make restitution to the banks involved on his conviction of bank robbery, United States Attorney David J. Hickton announced today.

Chief United States District Judge Sean M. McLaughlin imposed the sentence on Michael Eugene Brewster, 54.

According to information presented to the court, between June 21, 2012 and September 10, 2012, Brewster robbed eleven banks across the nation. In the course of the bank robbery spree Brewster used a similar method of operation and entered each bank, without being disguised, wore similar clothes, carried a dark leather notebook, presented demand notes containing similar threatening language to each of the victim tellers, and left the scene driving a 2009 black SUV, which Brewster had stolen in Pensacola, Florida. In his last bank robbery in Erie, Pennsylvania, on September 10, 2012, Brewster entered the Huntington National Bank, located at 2185 West 12th Street and presented a demand note, claiming that he had a gun and that the teller had one minute to comply. Brewster then claimed to the teller that he had cancer and did not care what happened. Brewster obtained bank proceeds and fled the area in a black SUV. Bank surveillance images and images from area surveillance cameras clearly depicted Brewster and the vehicle he used. Comparing the Erie Huntington Bank surveillance photographs with those from the ten other bank robberies that had occurred throughout the United States confirmed that each robbery had been committed by the same person. On September 12, 2012, the FBI received a tip that the bank robber depicted in the surveillance photographs was Brewster. A review of Brewster's Florida driver's license confirmed Brewster's identity as the bank robber. In addition, evidence disclosed that an arrest warrant had been issued for Brewster alleging that he had stolen a black Chevy Captiva SUV in Pensacola, Florida on June 11, 2012. Once Brewster's identity had been established in the Erie, Pennsylvania robbery, the FBI and law enforcement partners in the jurisdictions of the other ten bank robberies confirmed his identity in those cases as well.

Brewster entered the Chase Bank at 5250 Wadsworth Boulevard in Arvada, Colorado on June 21, 2012, the Chase Bank at 1484 South Milton Road in Flagstaff, Arizona on June 27, 2012; and the Ireland Bank at 486 Yellowstone Avenue in Pocatello, Idaho on July 6, 2012, and obtained federally insured funds after presented a threatening note demanding money. In Roy, Utah on July 6, 2012, Brewster entered the Wells Fargo Bank located at 5603 South 1900 West, and obtained money after presenting a threatening demand note claiming that he had only four months to live. In Winston-Salem, North Carolina on July 20, 1012, Brewster entered a Bank of America at 1209

Silas Creek Parkway and presented a threatening demand note indicating that he had nothing to lose and threatening to come back after the teller if any silent alarm was activated. Brewster obtained no money from the Wells Fargo Bank. Then, at the Regions Bank at 360 West State Road 436 in Altamonte Springs, Florida on July 27, 2012, the BB&T bank at 2120 Gunbarrel Road in Chattanooga, Tennessee on August 3, 2012; the PNC bank at 2217 West Market Street in Bloomington, Illinois on August 17, 2012; the Lamdmark bank at 202 North Stadium Boulevard in Colombia, Missouri on August 29, 2012; and the Lindell bank at 4521 Highway K in O'Fallon, Missouri on August 30, 2012, Brewster obtained money after presenting threatening demand notes, including a claim that he was armed with a gun.

On September 13, 2012, a police officer with the Roland Police Department in Roland, Oklahoma conducted a traffic stop of a black, 2009, Chevy Captiva vehicle and identified Brewster as the driver and sole occupant. A fake Utah license plate had been affixed to the vehicle. A computer check of Brewster's name revealed Brewster's outstanding arrest warrant in Pensacola, Florida for allegedly stealing the Chevy Captiva vehicle. Brewster was then taken into custody and was found to be in possession of money from the Erie, Pennsylvania Huntington bank robbery. Among other items located in the Captiva vehicle was a handgun, money from the Erie, Pennsylvania Huntington Bank robbery, the clothing worn by Brewster in the bank robberies as depicted in the surveillance photographs, and the leather notebook carried by Brewster into the banks he robbed. Brewster was then arrested on the Erie, Pennsylvania arrest warrant and he was returned to the Western District of Pennsylvania to face federal prosecution.

Prior to imposing sentence, Judge McLaughlin commented on the fact that Brewster's claim of a terminal disease was untrue and stated that, "The impetus for the crimes was simply greed, not grief."

Assistant United States Attorney Marshall J. Piccinini prosecuted this case on behalf of the government.

U.S. Attorney Hickton commended the Federal Bureau of Investigation in each of the jurisdictions, the Erie Bureau of Police, the Arvada Police Department, the Flagstaff Police Department, the Pocatello Police Department, the Roy City Police Department, the Winston-Salem Police Department, the Altamonte Springs Police Department, the Chattanooga Police Department, the Bloomington Police Department, the Columbia Police Department, the O'Fallon Police Department and the Roland Police Department for the investigations leading to the successful prosecution of Brewster.

JOHNSTOWN, Pa. - On Aug. 13, 2013, four residents of Johnstown, Pa., were indicted by a federal grand jury in Johnstown on charges of violating federal narcotics and firearms laws, United States Attorney David J. Hickton announced today.

The seven-count indictment named as defendants the following individuals:

Fred Claycomb, Jr., 50; Matthew John Claycomb, 21; Ronald Paul Copeland, 44; and
Nichelle Seeley, 27.

According to the indictment presented to the court, from Jan.1, 2013, through Jan. 25, 2013, Fred Claycomb, Jr., Matthew John Claycomb, Copeland and Seeley conspired to distribute and possess with intent to distribute less than 100 grams of heroin.

In addition, on Jan. 17, Jan. 18 and Jan. 25, 2013, Fred Claycomb, Jr., Matthew John Claycomb, Copeland and Seeley distributed less than 100 grams of heroin on each of these occasions, and on Jan. 25, 2013, Seeley possessed with the intent to distribute less than 100 grams of heroin.

On Jan.25 2013, Matthew John Claycomb was found in possession of a Harrington and Richardson, Model 158, 410 gauge shotgun. On Mar. 1, 2011, Claycomb was convicted in Cambria County, Pa., of firearms not to be carried without a license, which is a crime punishable by imprisonment for a term exceeding one year. Federal law prohibits persons who have been convicted of a crime punishable by imprisonment exceeding one year from possessing firearms.

The law provides for a maximum total sentence for Fred Claycomb, Jr. of 60 years in prison, a fine of $3,000,000, or both; for Matthew John Claycomb, 70 years in prison, a fine of $3,250,000, or both; for Copeland, 40 years in prison, a fine of $2,000,000, or both; and for Seeley, 60 years in prison, a fine of $3,000,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendants.

Assistant U.S. Attorney Stephanie L. Haines is prosecuting this case on behalf of the government.

The Laurel Highlands Resident Agency of the Federal Bureau of Investigation and the Cambria County Drug Task Force conducted the investigation leading to the indictment in this case.

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

According to Mr. Hickton, the case is being prosecuted as part of Project Safe Neighborhoods, a collaborative effort by federal, state and local law enforcement agencies, prosecutors and communities to prevent, deter and prosecute gun crime.

PITTSBURGH, Pa. - An Allegheny County man has been indicted by a federal grand jury in Pittsburgh on a charge of possession of material depicting the sexual exploitation of a minor, United States Attorney David J. Hickton announced today.

The one-count indictment named Kelly Eugene Jones, 39, as the sole defendant.

According to the indictment, on Feb. 15, 2013, Jones possessed visual depictions, namely, images in computer graphics files, the production of which involved the use of minors engaging in sexually explicit conduct.

The law provides for a maximum total sentence of 20 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.

Assistant United States Attorney Jessica Lieber Smolar is prosecuting this case on behalf of the government.

The Federal Bureau of Investigation and the Allegheny County District Attorney Investigations Unit conducted the investigation leading to the indictment in this case.

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

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

ERIE, Pa. - A resident of Erie, Pennsylvania, has been indicted by a federal grand jury in Erie on charges of mail fraud and tax evasion, United States Attorney David J. Hickton announced today.

The two-count indictment named Brian M. Quimby, 46, as the sole defendant.

According to the indictment presented to the court, while Quimby was employed as CFO of Thayer Power and Communications, he defrauded Key Bank. In addition, Quimby failed to file his income tax return for calendar year 2007.

The law provides for a maximum total sentence of 35 years in prison, a fine of $1,250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.

Assistant United States Attorney Christian A. Trabold is prosecuting this case on behalf of the government.

The Internal Revenue Service, Criminal Investigation, and the Federal Bureau of Investigation conducted the investigation leading to the indictment in this case.

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

PITTSBURGH, Pa. - A Detroit man pleaded guilty in federal court to conspiracy to access device fraud, United States Attorney David J. Hickton announced today.

Jamon Paul Judson, 32, of Detroit, Mich., pleaded guilty to one count before Senior United States District Judge Donetta W. Ambrose.

In connection with the guilty plea, the court was advised that Judson along with other defendants, left Michigan in early 2009 to use counterfeited, re-encoded credit cards to make purchases of retail store gift cards at numerous Giant Eagle stores in Ohio and Pennsylvania in 2009. The group was apprehended in Cranberry Township in August 2009, and found in possession of counterfeited credit cards and a device used to make counterfeit cards, as well. Losses total near $120,000.

Judge Ambrose scheduled sentencing for Dec, 4, 2013, at 11 a.m. The law provides for a total sentence of five years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the criminal history, if any, of the defendant.

Pending sentencing, the defendant was released on bond conditions.

Assistant United States Attorney Gregory C. Melucci is prosecuting this case on behalf of the government.

The Western Pennsylvania Financial Crimes Task Force (WPFCTF) conducted the investigation that led to the Indictment in this case. The WPFCTF was established in February 1995 as a collaborative, multi-agency effort to effectively combat financial crimes, including identity fraud, in Western Pennsylvania. Partners in this effort are the United States Attorney's Office for the Western District of Pennsylvania, the United States Secret Service, the United States Postal Inspection Service, the Department of Homeland Security, the Allegheny County District Attorney's Office, the Allegheny County Police Department, the City of Pittsburgh Bureau of Police and the Pennsylvania State Police.

ERIE, Pa. - A resident of Smethport, Pennsylvania, pleaded guilty in federal court to a charge of violating federal laws relating to the sexual exploitation of children, United States Attorney David J. Hickton announced today.

Peter Nollen Hergenrother, 63, pleaded guilty to one count before Senior United States District Judge Maurice B. Cohill, Jr.

In connection with the guilty plea, the court was advised that Hergenrother received computer images depicting minors engaging in sexually explicit conduct.

Judge Cohill scheduled sentencing for November 12, 2013 at 1:30 p.m. The law provides for a total sentence of 20 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the criminal history, if any, of the defendant.

Pending sentencing, the court continued Hergenrother on bond.

Assistant United States Attorney Christian A. Trabold is prosecuting this case on behalf of the government.

The Pennsylvania State Police conducted the investigation that led to the prosecution of Hergenrother.

Launched in February 2006, Project Safe Childhood is a nationwide initiative designed to protect children from online exploitation and abuse. Led by the U.S. Attorneys' Offices, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.

ERIE, Pa. - A resident of Erie, Pennsylvania, has been sentenced in federal court to 21 months in jail on his conviction of violating federal firearms laws, United States Attorney David J. Hickton announced today. The sentence was ordered to be served consecutively to any sentence imposed after his revocation of probation in the Court of Common Pleas of Erie County.

Senior United States District Judge Maurice B. Cohill, Jr. imposed the sentence on Damon Duane Amison, 21.

According to information presented to the court, Amison possessed a loaded Ruger P89 9mm handgun while being a convicted felon. The firearm was located by the Erie Police when they executed a search warrant of a residence on June 13, 2012. The evidence disclosed that the weapon had been stolen from a residence in Harborcreek Township, Pennsylvania.

Assistant United States Attorney Marshall J. Piccinini prosecuted this case on behalf of the government.

U.S. Attorney Hickton commended the Erie Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives for the investigation leading to the successful prosecution of Amison.

ERIE, Pa. - A resident of Erie, Pennsylvania, has been sentenced in federal court to 30 years in prison and lifetime supervised release on his conviction of violating federal firearms laws and laws relating to the sexual exploitation of children, United States Attorney David J. Hickton announced today.

Senior United States District Judge Maurice B. Cohill, Jr. imposed the sentence on Douglas E. Melter, 32.

According to information presented to the court, Melter attempted to induce a woman to procure an eleven year old female for Melter to sexually abuse and photograph naked. Melter offered to pay $1 ,200 for one hour alone with the girl at his home. Melter also possessed computer images depicting minors engaging in sexually explicit conduct and possessed a firearm after having been convicted of multiple felonies.

Prior to imposing sentence, Judge Cohill noted Melter's extensive criminal history and the very troubling aspects of Melter's conduct in the case.

Assistant United States Attorney Christian A. Trabold prosecuted this case on behalf of the government.

U.S. Attorney Hickton commended the Federal Bureau of Investigation, the Pennsylvania State Police and the Erie Police Department for the investigation leading to the successful prosecution of Melter.

Launched in February 2006, Project Safe Childhood is a nationwide initiative designed to protect children from online exploitation and abuse. Led by the U.S. Attorneys' Offices, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.

PITTSBURGH, Pa. - A resident of Allegheny County, Pa., has been sentenced in federal court to serve 37 months imprisonment, to be followed by three years supervised release, and ordered to pay restitution in the amount of $601,470.31, on his conviction of mail fraud, United States Attorney David J. Hickton announced today.

Senior United States District Judge Maurice B. Cohill imposed the sentence on Andrew A. Demasi, 63, of Natrona Heights, Pa.

According to information presented to the court, Demasi and his partner, Ronald Halpern, operated a business known as A & R Services, Inc., from an apartment at Washington Place, Pittsburgh, Pa. On behalf of A & R Services, Demasi and Halpern negotiated the purchase, sale, and delivery of sports-related merchandise and novelty items. During the period April 2007 through September 2007, Demasi and Halpern devised and executed a scheme to defraud manufacturers, wholesale distributors, and interstate shipping companies of money and property, valued at more than $600,000. The fraud scheme included obtaining merchandise for resale by applying for extensions of credit from the various manufacturers, wholesalers, and shipping companies based on false, financial information provided by Demasi.

On Aug. 3, 2007, Demasi and Halpern, in executing the scheme, obtained merchandise, delivered by interstate carrier FedEx, from Pro Specialities Group, Inc., in San Diego, California, based upon credit extended upon materially false financial information about the financial health and history of A & R Services, Inc. Demasi and Halpern had no intention of paying for the merchandise or its shipment after receipt.

Ronald Halpern entered a guilty plea before Judge Arthur Schwab and was sentenced in May 2013 to serve a 24-month term of imprisonment.

Assistant United States Attorney Carolyn J. Bloch prosecuted this case on behalf of the government.

U.S. Attorney Hickton commended the Federal Bureau of Investigation and the Office of the United States Trustee for the investigation leading to the successful prosecution of Demasi.