Northern District of Texas

Three Wichita Falls, TX drug dealers were sentenced to a combined 50 years in federal prison, announced U.S. Attorney for the Northern District of Texas Chad E. Meacham.

Nathaniel Collazo, 20, Calvin Cruz, 25, and Annaleigh Trevino, 22, all pleaded guilty to conspiracy to possess with intent to distribute a controlled substance. Mr. Collazo and Mr. Cruz were sentenced to 20 years apiece in federal prison; Ms. Trevino was sentenced to 10 years.

In plea papers, the defendants admitted the conspired to distribute methamphetamine.  In general, Mr. Collazo and Mr. Cruz obtained the stimulant, then distributed it to Ms. Trevino and others, who dealt it on the streets.

During a search of the defendants’ residence on June 3, 2021, law enforcement seized nine firearms, approximately eight pounds of methamphetamine, and $28,313 cash. 

The Wichita Falls Police Department's Organized Crime Unit conducted the investigation with the assistance of The Bureau of Alcohol, Tobacco, Firearms & Explosives’ Dallas Field Division. Assistant U.S. Attorneys Frank Gatto, Laura Montes, and Rob Boudreau prosecuted the case.

A Fort Worth man who smuggled freon into the U.S. was ordered to pay a $250,000 fine, announced U.S. Attorney Chad E. Meacham.

Faiz Abdallahi, 56, pleaded guilty in October 2021 to the improper importation of a class II substance, a felony under the Federal Clean Air Act. He was sentenced Tuesday to three years’ probation by Senior U.S. District Judge Terry R. Means.

According to plea papers, Mr. Abdallahi admitted that he smuggled HCFC-22, also known as R-22 refrigerant gas – an ozone-depleting chemical colloquially called freon – into the U.S. without an authorized permit in 2017.

The U.S. Environmental Protection Agency would later phase out production of R-22, which can no longer be produced or imported as of 2020.  Only recovered, recycled, or reclaimed supplies of R-22 are currently available, though consumers are not required to stop using R-22 air conditioners.

Mr. Abdallahi admits he arranged for Chinese R-22 to be delivered to the port of Long Beach California and then transported via rail to the Dallas/Fort Worth area disguised as R32 to avoid seizure by the US Customs and Border Protection.  His co-conspirator, 53-year-old Severo Zamora, then re-packaged and sold the R-22 to Heating, Ventilation and Air Conditioning (HVAC) companies in the U.S.  (Mr. Zamora pleaded guilty in January 2022 to being an accessory after the fact and was sentenced to six months’ probation.)

“The defendant’s intentional disregard for the environment included the illegal sale of hydrochlorflourocarbon-22 (R-22), a restricted substance which not only damages the ozone layer that protects people from the harmful effects of ultraviolet radiation, but also contributes to climate change,” said Todd “Tony” Adams, Assistant Special Agent in Charge of the EPA’s Southwest Area criminal enforcement program. “EPA and our federal partners continue to hold accountable companies and individuals that place public safety and the environment at risk.”

The investigation was conducted by the U.S. Environmental Protection Agency’s Criminal Investigation Division and Homeland Security Investigations.  Assistant U.S. Attorney Douglas Allen prosecuted the case.

The United States Attorney’s Office for the Northern District of Texas is searching for investors who may be victims of the conduct committed by United Development Funding (UDF) executives Hollis Morrison Greenlaw, Benjamin Lee Wissink, Cara Delin Obert, and Jeffrey Brandon Jester, announced U.S. Attorney Chad E. Meacham.

On Jan. 21, 2021, following a five day trial, a jury convicted the defendants of conspiracy to commit wire fraud, conspiracy to commit securities fraud, and eight substantive counts of securities fraud.

At trial, prosecutors proved beyond a reasonable doubt that between January 2011 and December 2015, Mr. Greenlaw and his coconspirators engaged in a scheme to defraud using investment fund entities UDF III, UDF IV, and UDF V.  

According to the Crime Victims’ Rights Act, victims – in this case, the roughly 30,000 individuals who invested in UDF III, IV, and V  –  may be entitled to restitution.

In order to be kept apprised of developments in the case, victims should visit https://www.justice.gov/usao-ndtx/united-states-v-greenlaw-et-al-udf for up-to-date information on sentencing hearings (currently scheduled for May 20, 2022 at 9 a.m. in Fort Worth, Texas before U.S. District Judge Reed O’Connor) and for instructions on how to submit victim impact statements, which may be emailed to USATXN.UDFVictims@usdoj.gov.

Prosecutors are requesting that broker-dealers and financial advisors who offered UDF III, IV, and V to their clients notify investors of this information as well.

The Federal Bureau of Investigation’s Dallas Field Office conducted the investigation. Assistant U.S. Attorneys Tiffany H. Eggers (NDTX Criminal Chief), Rachael Jones, Elyse Lyons, and Errin Martin prosecuted the case. U.S. District Judge Reed C. O’Connor presided over the trial.

A Dallas man has been charged with lying during two attempted firearms purchases, announced U.S. Attorney for the Northern District of Texas Chad E. Meacham.

Steven Royal, 29, was indicted this week on two counts of attempted acquisition of firearm from a licensed dealer by false statement, colloquially known as “lie and try.”

According to the indictment, Mr. Royal lied during attempted firearm purchases at pawn shops in Dallas and Waxahachie, Texas.

On ATF Form 4473, he stated that he was not under indictment for any felony. In fact, he was facing charges of aggravated assault of a family member with a deadly weapon and sexual assault of a child in Texas. Those cases are pending trial.

Neither purchase – one a Taurus .22 caliber pistol, the other a Rough Rider .22 caliber revolver – went through.

 “Whether or not Mr. Royal physically possessed the firearm was inconsequential here. He knew he wasn’t allowed to possess firearms, however allegedly tried the system anyways. That system worked as designed and prevented the illegal purchase. ATF and its law enforcement partners remain committed to keeping firearms out of the hands of those that should not have them,” stated ATF Dallas Field Division Special Agent in Charge Jeffrey C. Boshek II. 

An indictment is merely an allegation of criminal conduct, not evidence. Like all defendants, Mr. Royal is presumed innocent until proven guilty in a court of law.

If convicted, he faces up to 10 years in federal prison.

The Bureau of Alcohol, Tobacco, Firearms, & Explosives’ Dallas Field Division conducted the investigation. Assistant U.S. Attorney Shane Read is prosecuting the case.

An ex-employee of the Los Angeles Angels was convicted today in connection with the 2019 overdose death of Angles pitcher Tyler Skaggs, announced U.S. Attorney for the Northern District of Texas Chad Meacham.

After less than an hour and a half of deliberation, a federal jury found former Angels Communications Director Eric Prescott Kay, 47, guilty of distribution of a controlled substance resulting in death and conspiracy to possess with intent to distribute controlled substances.

According to evidence presented at trial, Mr. Kay distributed the pills that killed Mr. Skaggs.

The investigation began on July 1, 2019, when the Southlake Police Department received a 911 call stating that Mr. Skaggs, then just 27 years old, had been found dead in his hotel room at the Southlake Town Square Hilton. The Tarrant County Medical Examiner’s office later determined that Mr. Skaggs had a mixture of ethanol, fentanyl, and oxycodone in his system at the time of his death..

Inside Mr. Skaggs’s hotel room, investigators discovered a number of pills, including a single blue pill with the markings M/30.  An analysis of the pill  – which closely resembled a 30-milligram oxycodone tablet – revealed it had been laced with fentanyl, a powerful synthetic opiate.

In an initial interview with law enforcement, Mr. Kay denied knowing whether Mr. Skaggs was a drug user. He claimed the last time he’d seen Mr. Skaggs was at hotel check-in on June 30. However, a search of Mr. Skaggs’s phone revealed text messages from June 30 suggesting that he had asked Mr. Kay to stop by his room with pills late that evening. Investigators later learned that, contrary to what he’d told law enforcement the day Mr. Skaggs’s body was discovered, Mr. Kay had admitted to a colleague that he had, in fact, visited Mr. Skaggs’s room the night of his death.

In the course of their investigation, the Drug Enforcement Administration determined that Mr. Kay allegedly regularly dealt the blue M/30 pills – dubbed “blue boys” – to Mr. Skaggs and to others, dolling out the pills at the stadium where they worked.

Several former Angels players, including Matt Harvey, C.J. Cron, Mike Morin, and Cameron Bedrosian testified at trial that Eric Kay distributed blue 30 milligram oxycodone pills to them as well.  They further testified that he was the only source of these pills and would conduct transactions in the Angels Stadium.

“This case is a sobering reminder: Fentanyl kills. Anyone who deals fentanyl — whether on the streets or out of a world-famous baseball stadium — puts his or her buyers at risk,” said U.S. Attorney Chad Meacham. “No one is immune from this deadly drug. A beloved pitcher, Tyler Skaggs was struck down in the midst of an ascendant career. The Justice Department is proud to hold his dealer accountable for his family and friends’ unimaginable loss.” 

“Unfortunately, this guilty verdict will not bring Mr. Skaggs back or take away the suffering his family and friends have endured since 2019. What it does do; however, is affirm that justice prevails and drug dealers and enablers, like Mr. Kay, will be held accountable for their reckless actions,” said  Eduardo A. Chávez, Special Agent in Charge of DEA Fort Worth.  “DEA will continue to aggressively investigate the distribution of diverted and counterfeit prescription drugs in our communities.  The memories of those lives lost to drug overdose must not be in vain.” -

Mr. Kay now faces between 20 years and life in federal prison. His sentencing has been set for June 28, 2022. Following the reading of the verdict, the defendant was immediately remanded into the custody of the United States Marshal Service. 

The Drug Enforcement Administration’s Fort Worth Field Division and the Southlake Police Department conducted the investigation with the assistance of the Tarrant County District Attorney’s Office, the Federal Bureau of Investigation, the United States Secret Service, and the Tarrant County Medical Examiner’s Office. Assistant U.S. Attorneys Lindsey Beran, Errin Martin, and Joe Lo Galbo are prosecuting the case with the help of Assistant U.S. Attorney Jon Bradshaw. Senior U.S. District Judge Terry R. Means presided over the trial.

CORRECTION: An earlier version of this release put Mr. Kay's age at 45. He was 45 when he was first charged, but was 47 when he was convicted. 

A west Texas gas plant has been ordered to pay a $3 million criminal fine, announced U.S. Attorney for the Northern District of Texas Chad E. Meacham.

Big Lake Gas Plant L.P., a subsidiary of West Texas Gas, Inc., pleaded guilty in September 2021 to  one count of negligent endangerment and one count of violating the Clean Air Act. The company, represented by counsel, was sentenced Thursday by U.S. District Judge James Wesley Hendrix.  

In plea papers, the company admitted that in April 2018, the plant negligently released approximately 525 pounds of hydrogen sulfide into the ambient air. (Hydrogen sulfide is a toxic gas that can compromise the human nervous system and respiratory tract and can cause life-threatening health effects if not handled properly.)

One employee, identified in court documents by the initials C.T., died as a result of exposure sustained while working at the plant. Another employee, identified by the initials G.T., was injured while trying to assist C.T.

The company further admitted that it knowingly failed to properly update its risk management plan following the incident, an update required by law.  

“Big Lake’s flagrant disregard of federal clean air regulations had calamitous consequences,” said U.S. Attorney Chad Meacham. “Our prayers are with the family of the employee killed in the 2018 hydrogen sulfide incident. We hope today’s sentencing brings them a measure of peace.”

“The defendant’s willful and knowing disregard for federal safety regulations and industry practices placed both workers and the public at grave risk, resulting in a tragic and preventable fatality and release of dangerous gasses.” said Todd “Tony” Adams, Assistant Special Agent-in-Charge of the EPA’s Southwest Office criminal enforcement program. “EPA and its state partners continue to hold accountable companies that place workers, local communities, and the environment at risk.”

In a related civil case, five subsidiaries of Big Lake’s parent company, West Texas Gas, agreed to pay more than $3 million in civil penalties and to spend up to $5 million on compliance measures in order to resolve claims that it violated federal Clean Air Act chemical accident prevention requirements at plants in Texas and New Mexico.

Assistant U.S. Attorney Sean Taylor prosecuted the criminal case against Big Lake. Assistant U.S. Attorney Ann Haag handled the civil case against West Texas Gas in partnership with the Justice Department’s Environment and Natural Resources Division. The Environmental Protection Agency’s criminal enforcement program investigated with the assistance of the Texas Commission on Environmental Quality's Environmental Crimes Unit and the Federal Bureau of Investigation.

Ten people, including two medical doctors, have been indicted in a $300 million healthcare fraud, announced U.S. Attorney for the Northern District of Texas Chad E. Meacham.

The defendants – who stand accused of accused of conspiracy to commit healthcare fraud, conspiracy to pay and receive healthcare kickbacks, offering or paying illegal kickbacks, and soliciting or receiving illegal kickbacks – were charged in a 26-count indictment filed Wednesday afternoon. 

“Anti-kickback laws are designed to ensure that financial considerations do not cloud physicians’ judgement,” said U.S. Attorney Chad Meacham. “The Justice Department is determined to prosecute those flouting our nation’s healthcare fraud laws. Patients – and taxpayers – deserve rigorous enforcement.”

“Illegal kickback schemes corrupt the healthcare system. They cause billions of dollars in losses each year, generate business for dishonest service providers and erode trust in our health care system,” said Dallas FBI Special Agent in Charge Matthew DeSarno. “The FBI will continue to work with our law enforcement partners to expose fraud and protect the public from illegal schemes.”

According to the indictment, the founders of several lab companies, including Unified Laboratory Services, Spectrum Diagnostic Laboratory, and Reliable Labs LLC, allegedly paid kickbacks to induce medical professionals to order medically unnecessary lab tests, which they then billed to Medicare and other federal healthcare programs.

The medical professionals -- including internal medicine specialist Eduardo Canova, family medicine practitioner Jose Maldonado, and nurse practitioner Keith Wichinski – allegedly accepted the bribes and ordered millions of dollars’ worth of tests.

Meanwhile, Unified, Spectrum, and Reliable disguised the kickbacks as legitimate business transactions, including as medical advisor agreement payments, salary offsets, lease payments, and marketing commissions.

The labs, through marketers, allegedly paid doctors hundreds of thousands of dollars for “advisory services” which were never performed in return for lab test referrals. They also allegedly paid portions of the doctors’ staff’s salaries and a portion of their office leases, contingent on the number of lab tests they referred each month. In some instances, lab marketers even made direct payments to the provider’s spouse.  (When the labs threatened one provider that payments would cease if he didn’t refer more tests, he immediately increased his lab referrals, averaging approximately 20 to 30 referrals per day.)

Knowing they could disguise additional kickbacks using a provider-ownership model, the founder of Spectrum and Unified, Jeffrey Madison, convinced the co-founders of Reliable, Biby Kurian and Abraham Phillips, to convert Reliable into a physician-owned lab. Reliable offered physicians ownership opportunities only if those physicians referred an adequate number of lab tests. In some cases, they made advance disbursement payment to physicians in an effort to appease the physician and ensure he would not send samples to other labs.

As a result of these kickbacks, laboratories controlled by the defendants were able to submit more than $300 million in billing to federal government healthcare programs.  Between 2015 and 2018, Dr. Maldonado alone received more than $400,000 in kickbacks for ordering more than $4 million worth of lab tests and Dr. Canova received more than $300,000 in kickbacks for ordering more than $12 million worth of lab tests.

Defendants indicted are:

• Jeffrey Paul Madison, 56, founder of Unified Laboratory Services and Spectrum Diagnostic Laboratory

• Mark Christopher Boggess, 49, chief operating officer for Spectrum and Unified

• Biby Ancy Kurian, 49, co-founder of Reliable Labs, LLC

• Abraham Phillips, 50, co-founder of Reliable Labs, LLC

• Dr. Jose Roel Maldonado, 48, family medicine doctor based in Laredo

• Dr. Eduardo Carlos Canova, 44, internal medicine specialist based in Laredo

• Keith Allen Wichinski, 50, board-certified nurse practitioner based in San Antonio

• David Michael Lizcano, 56, ]owner of DCLH, a marketing firm engaged by Unified, Spectrum, and Reliable

• Laura Ortiz, 58, sister of David Lizcano and employee at his marketing firm

• Juan David Rojas, 34, owner of Rojas & Associates, another marketing firm engaged by Unified, Spectrum, and Reliable

An indictment is merely an allegation of criminal conduct, not evidence. Defendants are presumed innocent until proven guilty in a court of law.

If convicted, the defendants face up to 55 years or more in federal prison.

The Federal Bureau of Investigation’s Dallas Field Office, the U.S. Department of Health and Human Services’ Office of Investigations, the Defense Criminal Investigative Service, and the Veterans Affairs’ Office of Inspector General conducted the investigation. Assistant U.S. Attorney P.J. Meitl is prosecuting the case.

A Dallas woman has been indicted for committing a string of bank robberies, announced U.S. Attorney for the Northern District of Texas Chad E. Meacham.

Patricia Maldonado, 34, was indicted last week on three counts of bank robbery. At a detention hearing, U.S. Magistrate Judge Renee Harris Toliver ordered her detained pending her trial, which is set for April 11.

The indictment alleges Ms. Maldonado robbed at least three Dallas banks in the fall of 2019: Comerica Bank on Fort Worth Avenue, Chase Bank on Mockingbird Lane, and Chase Bank on Coit Road.

She was eventually identified by a concerned citizen who recognized her face in surveillance images included in a news release, according to a criminal complaint filed in January.

Per the complaint, Ms. Maldonado, who always wore a baseball cap of some sort, generally entered the banks, handed the tellers a note demanding money and stating she had a gun, and fled on foot with the cash. On at least one occasion, she was caught on camera hopping into a silver Jeep Patriot parked at a nearby gas station.

Following the concerned citizen’s identification of Ms. Maldonado, law enforcement conducted an analysis of her social media presence, noting the resemblance between her and the suspect. On her Facebook page, they found a photo of her wearing a sweatshirt identical to one worn by the suspect in the Comerica robbery. On her sister’s Facebook page, they found multiple photos of her posing beside her sister’s silver Jeep Patriot.

On Jan. 29, officers arrested Ms. Maldonado at her place of employment. After being advised of her Miranda rights, Ms. Maldonado positively identified herself in surveillance photos from all the robberies.

An indictment is merely an allegation of criminal conduct, not evidence. Like all defendants, Ms. Maldonado is presumed innocent until proven guilty in a court of law.

If convicted, she faces up to 20 years in federal prison.

The Federal Bureau of Investigation’s Dallas Field Office and the Dallas Police Department conducted the investigation. Assistant U.S. Attorney Abe McGlothin is prosecuting the case.

Jennifer Lynne Faith, the Oak Cliff woman who convinced her boyfriend to shoot her husband to death, pleaded guilty on Monday to orchestrating the murder, announced U.S. Attorney for the Northern District of Texas Chad E. Meacham.

In February 2021, prosecutors charged Ms. Faith, 49, with obstruction of justice. In September 2021, they added a charge of use of interstate commerce in the commission of murder-for-hire, an offense that carries a potential death sentence. Ms. Faith pleaded guilty to the murder-for-hire charge before U.S. District Judge Jane J. Boyle on Monday morning. In return for her plea, prosecutors agreed to drop the obstruction charge and to recommend a sentence of life imprisonment. Sentencing will ultimately be at the discretion of the judge.

“Jennifer Faith’s cold-blooded plot to murder her husband was made all the more heinous by the way she behaved after his death. Even as she wept for her late husband on TV, Ms. Faith was corresponding with his murderer, plotting about how to cover up their crime,” said U.S. Attorney Chad Meacham. “The U.S. Attorney’s Office, ATF, DPD, and our law enforcement partners remain committed to getting justice for Jamie. We are proud to hold Ms. Faith accountable for her crimes, and look forward to proving our case against her boyfriend, Mr. Lopez, in court. Truth will prevail in the end.”

“Lies, deceit and ultimately the murder of a loving spouse. After attempting to manipulate family, friends and caring citizens, Mrs. Faith has now admitted to her heinous acts. I could not be prouder of the work of all those involved in this investigation, specifically, the Dallas Police Department Homicide Unit, the United States Attorney’s Office, and ATF Special Agents. What’s done in the dark will always come to light,” stated ATF Dallas Field Division Special Agent in Charge Jeffrey C. Boshek II.

According to plea papers, Ms. Faith admitted that her boyfriend, Darrin Ruben Lopez, 49, gunned down her husband, American Airlines technology director Jamie Faith, on Oct. 9, 2020 in front of his home in Oak Cliff. (Mr. Lopez has been charged by the state with murder and by the feds with a gun crime. He has pleaded not guilty to both charges. Like all defendants, he is presumed innocent until proven guilty in a court of law.)

Ms. Faith admitted that she knew Mr. Lopez – whom she called her “one and only love” – had suffered a traumatic brain injury while serving in the U.S. Army in Iraq, leaving him disabled. Both before and after the murder, she sent Mr. Lopez money and gifts, and even provided him with two credit cards which she paid off using the proceeds of a “Support Jennifer Faith” GoFundMe fundraiser launched in the wake of her husband’s death.

She also admitted that before the murder, she used two phony email accounts to correspond with Mr. Lopez, assuming the identities of her own husband and one of her friends in order to falsely convince Mr. Lopez that her husband was physically and sexually abusing her. (In plea papers, Ms. Faith stipulated that no such abuse ever occurred.) Ms. Faith admitted that she downloaded stock images depicting injuries from the internet and attached them to some of the emails to convince Mr. Lopez that the abuse was actually occurring.

Seven months into her relationship with Mr. Lopez, Ms. Faith exited her home with her husband to walk their dog, she acknowledged in plea papers. One minute into their walk, Mr. Lopez – who allegedly drove from his home in Cumberland Furnace, Tennessee, to the Faiths’ home in Dallas, where he laid in wait at a neighbor’s home – allegedly shot Mr. Faith seven times before fleeing the scene in his black Nissan Titan pickup truck, which had a distinctive “T” decal on the back window.

After she learned that law enforcement was aware of the “T” decal, Ms. Faith appeared on DFW’s ABC affiliate, WFAA, and plead with the public to help investigators locate the decaled truck. Following the interview, Ms. Faith texted Mr. Lopez and encouraged him to remove the sticker from his truck, she admitted.

“I woke up in a bit of a panic… Something is eating away at me telling me you need to take the sticker out of the back window of the truck,” she texted him. “I don’t normally overreact like this… really think you need to get that sticker off ASAP, like today.” Mr. Lopez allegedly removed the sticker the following day.

Meanwhile, approximately one month after her husband’s death, Ms. Faith admitted, she initiated a claim with Metropolitan Life Insurance Company seeking approximately $629,000 in death benefits Mr. Faith had through his employer. She periodically updated Mr. Lopez on the status of the claim. In text messages, the pair discussed using the money to apply for a residence in her name in Tennessee.

In January 2021, shortly after she was asked to come in for questioning by investigators, Ms. Faith reached out to Mr. Lopez to coordinate their cover stories, she admitted in plea papers.

“If asked about you, you are an old friend going through a divorce. We talk every night because I am helping/giving support with the girls,” she texted. “Just in case they pulled phone records and ask.”

“Good idea,” Mr. Lopez responded. “You are doing good.”

ATF agents arrested Mr. Lopez on murder charges in Cumberland Furnace on Jan. 11, 2021. The firearm used to kill Mr. Faith was recovered inside Mr. Lopez’s home.  

On Feb. 2, 2021, shortly before she was charged, Ms. Faith contacted a third party and asked that a message be forwarded to Mr. Lopez, who at the time was in custody in Dallas.

“I am with him, will always be with him regardless of whatever has happened. I’ve needed to be cautious because every communication is being monitored,” the message read in part. “Please tell him ASAP I will always be his.”

The Office of the United States Attorney General approved Ms. Faith’s plea agreement, as is customary in cases involving death penalty eligible cases. She is slated to be sentenced on May 26.  

The Bureau of Alcohol, Tobacco, Firearms & Explosives’ Dallas Field Division and the Dallas Police Department’s Homicide Unit conducted the investigation with the assistance of the ATF’s Nashville Field Office, the Federal Bureau of Investigation’s Dallas Field Office, Homeland Security Investigations, the Tennessee Bureau of Investigation’s Aviation Unit, and the U.S. Attorney’s Office for the Middle District of Tennessee. NDTX Assistant U.S. Attorneys Rick Calvert and Andrew Briggs are prosecuting the case.

A 38-year-old man who robbed a cell phone store at gunpoint has been sentenced to more than 25 years in federal prison for robbery, carjacking, and multiple gun crimes, announced U.S. Attorney for the Northern District of Texas Chad E. Meacham.

In June, a federal jury convicted Michael Tremaine Schexnayder of one count of interference with commerce by robbery, one count of carjacking, one count of brandishing a firearm during a crime of violence, and one count of possession of a firearm by a convicted felon. He was sentenced on Jan. 25 to 308 months in federal prison by U.S. District Judge Samuel A. Lindsay, who also ordered him to pay $15,658.74 in restitution.

“This defendant menaced innocent citizens with a gun. They will never forget the terror they endured that day,” said U.S. Attorney Chad Meacham. “We hope they will find some solace in knowing Mr. Schexnayder will spend the next quarter century behind bars.”

“Robbery, car jackings, and gun crimes might make for entertaining television shows but they won’t be tolerated on the streets of North Texas. The storybook ending here is that Mr. Schexnayder will have the next thirty years in Federal Prison to write his next script. ATF is grateful to its law enforcement partners who work tirelessly to keep our citizens safe,” stated ATF Dallas Field Division Special Agent in Charge Jeffrey C. Boshek II. 

According to evidence presented at his trial, around 10:45 a.m. on July 16, 2019, Mr. Schexnayder entered a Grand Prairie T-Mobile store, armed with a small black pistol. After milling around for a few moments, he suddenly approached two employees and a customer, pointing his gun in their faces.  He demanded they hand over personal possessions – cell phones, watches, cash, and car keys – and then ordered staff members to open the safe in the back of the store.

Terrified, one of the employees, an assistant store manager, explained that the safe was on a time delay, and would not open for a period of several minutes after she input the code. The employee testified that Mr. Schexnayder, who apparently did not believe her, grew agitated, and forced her instead to empty the till into a garbage bag. He then demanded that the same employee surrender her car keys and describe her vehicle, a boxy white Toyota Scion.

With their property in tow, he fled the store.

Employees and customers then barricaded themselves in the back of the store and the assistant manager dialed 911. Within moments of police’s arrival, the assistant manager noticed her vehicle was missing, as was her iPhone. 

With the assistant store manager’s permission, officers quickly began tracking her phone, located the vehicle, and gave chase. An officer observed the driver run into a wooded area as the Toyota rolled to a stop. Officers later found Mr. Schexnayder lying in the woods, dressed in the same clothing robbery witnesses had described. A short distance away, they found a small black pistol stashed under a pile of wood.

The Bureau of Alcohol, Tobacco, Firearms & Explosives’ Dallas Field Division conducted the investigation. Assistant U.S. Attorneys Gary Tromblay and Lindsey Beran prosecuted the case.

A Dallas man who conned 417 investors out of nearly $15 million was sentenced to 17 ½ years in federal prison, announced U.S. Attorney for the Northern District of Texas Chad E. Meacham.

Rudy Avila, 69, pleaded guilty to wire fraud in June 2021. He was sentenced on Jan. 28 by Chief U.S. District Judge Barbara M.G. Lynn, who also ordered him to pay $14,955,313.00 in restitution.

According to plea papers, Mr. Avila admitted he defrauded investors in seven investment companies: Starwood Asset Management Fund, Commodities Investment Group International, Trading Technologies Group, Trading Ventures Group, The L.I.F.T. Group, Capital Ventures Group, and Ventures Group, LLC, none of which were registered with the United States Securities and Exchange Commission or the Commodities Futures Trading Commission as required by law.

Instead of investing money in U.S. based businesses as he had represented, Mr. Avila regularly wired at least 90% of the investors’ funds to bank accounts belonging to coconspirators in Costa Rica or to make  Ponzi payments to other investors.

In order to convince investors that their funds were controlled by U.S. businesses, the defendant registered multiple businesses with the Texas Secretary of State, filed sham annual reports from the businesses, set up U.S. bank accounts for the businesses, and rented office space in DFW.  

At Mr. Avila’s sentencing hearing, Judge Lynn read the names of all 417 victims and their loss amounts into the record.

Two of his coconspirators, Eddie Alexander Contreraz and Ivan Aguirre, who both pleaded guilty to conspiracy to commit wire fraud last year, are still awaiting sentencing.

The Federal Bureau of Investigation’s Dallas Field Office conducted the investigation. Assistant U.S. Attorneys Marcus Busch and Nick Bunch (fmr.) are prosecuting the case.

An associate professor of biology at  West Texas A&M University has been indicted for smuggling goods into the United States and violating the Endangered Species Act, announced U.S. Attorney for the Northern District of Texas Chad E. Meacham.

Dr. Richard Kazmaier, 54, allegedly imported protected wildlife items into the country without declaring it or obtaining the required permits.

The Endangered Species Act and federal regulations require importers to declare wildlife, including parts and products, to customs and U.S. Fish and Wildlife Service when it enters the country.

The indictment charges that, between March 2017 and February 2020, Dr. Kazmaier imported wildlife items from around the world into the United States without declaring them. These items included skulls, skeletons and taxidermy mounts.

The Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES) regulates trade in endangered or threatened species through permit requirements. The United States and 183 other countries are signatories to the CITES treaty.

The indictment also charges Dr. Kazmaier with importing wildlife items from 14 protected species without obtaining permits, including the Eurasian otter, lynx, caracal, vervet monkey, greater naked-tailed armadillo, and king bird-of-paradise.

An indictment is merely an allegation, not evidence. Like all defendants, Dr. Kazmaier is presumed innocent until proven guilty in a court of law.

If convicted, he faces a maximum of 20 years in prison and a $250,000 fine for the felony smuggling charge. The two Endangered Species Act charges are misdemeanors with a maximum sentence of one year incarceration and a $100,000 fine.

The U.S. Fish and Wildlife Service’s Office of Law Enforcement in Redmond, Washington, conducted the investigation as part of Operation Global Reach, which focused on the trafficking of wildlife from Indonesia to the United States. Assistant U.S. Attorney Anna Bell for the Northern District of Texas and Trial Attorney Ryan Connors of the Justice Department’s Environmental Crimes Section are prosecuting the case.

Twenty alleged drug dealers and their associates have been arrested and charged in “Operation Shut Down Corner,” announced U.S. Attorney for the Northern District of Texas Chad E. Meacham. 

The operation – which involved more than 150 agents and officers from the North Texas OCEDTF Strike Force – focused on Hamilton Park, a north Dallas neighborhood that has long been plagued by crime driven by a violent gang known as the Hamilton Park Posse. 

During the investigation, DEA agents and their law enforcement partners seized 37 guns, 220 lbs of drugs (including cocaine, fentanyl-laced counterfeit pills, methamphetamine, and marijuana), $420,000 in assets (including U.S. currency, vehicles, and jewelry).

Twenty-one defendants have been charged in two indictments alleging a variety of crimes, including conspiracy to distribute fentanyl, conspiracy to distribute cocaine, maintaining drug involved premises, using cell phones to facilitate the distribution of controlled substances, and possession of firearms in furtherance of drug trafficking crimes.  (One defendant remains a fugitive.)

Many of the defendants arrested in Operation Shut Down Corner have extensive criminal histories and have faced charges including aggravated assault, battery, robbery, theft, forgery, drug possession, weapon possession, and terroristic threats.

“This drug trafficking, gun wielding street gang has been terrorizing their neighborhood for far too long,” U.S. Attorney Chad Meacham said at a press conference at the DEA Wednesday. “I hope the residents of Hamilton Park will rest easier tonight knowing that the Justice Department has their backs.”

“As the layers of this investigation began to reveal themselves, we identified a highly organized, poly-drug distribution organization, feeding our streets with cocaine, crack-cocaine, marijuana, methamphetamine, and deadly counterfeit prescription drugs containing fentanyl,” said DEA Special Agent in Charge Eduardo Chavez. “The Hamilton Park area of Dallas was once described to me as a ‘Forgotten Neighborhood.’ That stops now.”

Those charged include:
 

• Randall Hoskins, aka “Rambo,” charged with conspiracy to possess with intent to distribute controlled substances

• Demetric Watson, charged with conspiracy to possess with intent to distribute controlled substances

• Rosie Bush, aka “Shanta,” charged with conspiracy to possess with intent to distribute controlled substances

• Kemerra Gilbert, charged with conspiracy to possess with intent to distribute controlled substances

• Jerome Brown, charged with conspiracy to possess with intent to distribute controlled substances

• Jimmy Reedy, aka “UM-8033,” charged with unlawful use of a communication facility

• Quientin Titus, aka “QT” or “Quick Trip,” charged with maintaining a drug involved premises and conspiracy to possess with intent to distribute controlled substances

• Devonte Thursby, aka “Wook,” charged with conspiracy to possess with intent to distribute controlled substances and unlawful use of a communication facility

• Jerome Miller, charged with conspiracy to possess with intent to distribute controlled substances

• Brian Williams, charged with conspiracy to possess with intent to distribute controlled substances, possession with intent to distribute controlled substances, and possession of a firearm in furtherance of a drug trafficking crime

• Staecey Logan, charged with two counts of unlawful use of a communication facility

• Kimmy Blanton (fugitive), charged with unlawful use of a communication facility

• Tamara Cashaw, charged with conspiracy to possess with intent to distribute controlled substances and unlawful use of a communication facility

• Damone Dixon, charged with conspiracy to possess with intent to distribute controlled substances

• Michael Gipson, aka “Grip,” charged with conspiracy to possess with intent to distribute controlled substances

• Bridney Fannin, charged with unlawful use of a communication facility

• Reginald Lamar Denson, charged with conspiracy to possess with intent to distribute controlled substances, possession with intent to distribute controlled substances, and possession of a firearm by a convicted felon

• Jahmear Chance Jackson, charged with conspiracy to possess with intent to distribute controlled substances, possession with intent to distribute controlled substances, and possession of a firearm by a convicted felon

• Addison Cole, aka “Addy” or “Scat Back,” charged with conspiracy to possess with intent to distribute controlled substances

• Sergei Gharpetian, charged with conspiracy to launder money

• Tigran Mkrtchyan, charged with conspiracy to launder money

 

Indictments are merely allegations of criminal conduct, not evidence. All defendants are presumed innocent until proven guilty in a court of law.

If convicted, some defendants face maximums of up to 40 years in federal prison.

The investigation was led by the North Texas OCDETF Strike Force – which includes the Drug Enforcement Administration’s Dallas Field Division, the Federal Bureau of Investigation’s Dallas Field Office, the Bureau of Alcohol, Tobacco, Firearms and Explosives’ Dallas Field Division, the U.S. Marshals Service, Homeland Security Investigations’ Dallas Field Division, the U.S. Coast Guard, U.S. Secret Service, U.S. Department of the Treasury, Internal Revenue Service, U.S. Postal Service, U.S. Department of Labor Office of the Inspector General – along with the Dallas Police Department. Assistant U.S. Attorney Myria Boehm is prosecuting the case with the assistance of Assistant U.S. Attorney Travis Elder.

The Organized Crime Drug Enforcement Task Forces (OCDETF) Strike Force Initiative provides for the establishment of permanent multi-agency task force teams that work side-by-side in the same location. This co-located model enables agents from different agencies to collaborate on intelligence-driven, multi-jurisdictional operations to disrupt and dismantle the most significant drug traffickers, money launderers, gangs, and transnational criminal organizations. The North Texas OCDETF Strike Force investigates and prosecutes major drug trafficking, money laundering, and other high priority transnational organized crime networks.

The man who sold Malik Faisal Akram the gun he used to kidnap hostages in a Texas synagogue earlier this month has been charged with a federal firearm crime, announced United States Attorney for the Northern District of Texas Chad E. Meacham.

Henry “Michael” Dwight Williams, 32, was charged Tuesday via criminal complaint with being a felon in possession of a firearm. He made his initial appearance before U.S. Magistrate Judge Renée H. Toliver in the Northern District of Texas Wednesday afternoon. A detention hearing has been set for Monday, Jan. 31.  

“Federal firearm laws are designed to keep guns from falling into dangerous hands. As a convicted felon, Mr. Williams was prohibited from carrying, acquiring, or selling firearms. Whether or not he knew of his buyer’s nefarious intent is largely irrelevant — felons cannot have guns, period, and the Justice Department is committed to prosecuting those who do,” said U.S. Attorney Chad E. Meacham. “We are grateful to the many officers and agents who sprang into action as soon as the synagogue hostage crisis began, and who worked tirelessly to track the weapon from Mr. Akram to Mr. Williams. The freed hostages, the Beth Israel congregation, and indeed the entire Jewish community deserve that support.” 

“The Dallas FBI Field Office and our partners have worked around the clock since January 15, 2022 to determine how Malik Faisal Akram acquired the weapon he used to terrorize worshipers at Colleyville’s Congregation Beth Israel synagogue," said Dallas FBI Special Agent in Charge Matthew DeSarno. "Along with our federal, state and local law enforcement partners we pledge to continue our efforts to protect our communities from violence."

According to the complaint, Mr. Williams – a felon previously convicted of aggravated assault with a deadly weapon and attempted possession of a controlled substance – allegedly sold Mr. Akram a semiautomatic Taurus G2C pistol on Jan. 13. Two days later, on Jan. 15, agents recovered the pistol from Colleyville’s Congregation Beth Israel synagogue, where Mr. Akram had held four individuals hostage for several hours before he was fatally shot by federal law enforcement.

As part of its intensive investigation into the hostage taking, the FBI tied Mr. Williams to Mr. Akram through an analysis of Mr. Akram’s cellphone records, which showed the pair exchanged a series of calls from Jan. 11 through Jan. 13.

When agents first interviewed Mr. Williams on Jan. 16, Mr. Williams stated that he recalled meeting a man with a British accent, but that he could not recall the man’s name. (Mr. Akram was a British citizen.) Agents interviewed the defendant again on Jan. 24, after he was arrested on an outstanding state warrant. After viewing a photo of Mr. Akram, Mr. Williams confirmed he sold Mr. Akram the handgun at an intersection in South Dallas. Analysis of both men’s cellphone records showed that the two phones were in close proximity on Jan. 13.

Mr. Williams allegedly admitted to officers that Mr. Akram told him the gun was going to be used for “intimidation” to get money from someone with an outstanding debt.

A criminal complaint is merely an allegation of criminal conduct, not evidence. Like all defendants, Mr. Williams is presumed innocent until proven guilty in a court of law.

If convicted, he faces up to 10 years in federal prison. 

The Federal Bureau of Investigation’s Dallas Field Office conducted the investigation with the assistance of the Dallas Police Department, the Bureau of Alcohol, Tobacco, Firearms & Explosives’ Dallas Field Division, Homeland Security Investigations’ Dallas Field Division, and the Colleyville Police Department. Assistant U.S. Attorney Joe Magliolo is prosecuting the case with the support of Assistant U.S. Attorneys Errin Martin, Jay Weimer, Alex Lewis, Lindsey Beran, Nicole Dana, and P.J. Meitl, along with Trial Attorneys David Smith and Michael Dittoe of the Justice Department’s National Security Division.

The CEO of a local hospice agency has been sentenced to 13 years and 3 months in federal prison for defrauding Medicare and Medicaid, announced U.S. Attorney for the Northern District of Texas Chad E. Meacham.

Bradley J. Harris, the 39-year-old former head of Novus and Optimum Health Services, pleaded guilty last March to conspiracy to commit healthcare fraud and healthcare fraud. He was sentenced today by Chief U.S. District Judge Barbara M.G. Lynn, who ordered him to pay $27,594,875.52 in restitution.

“This defendant systematically lied to federal healthcare programs, dolling out powerful pain medication without the physician oversight that Novus’ patients deserved,” said U.S. Attorney Chad Meacham. “Brad Harris allowed greed to corrupt his judgement, and he will pay dearly for it. The Northern District of Texas will not tolerate healthcare fraud.”

“Mr. Harris’ actions to steal tens of millions of dollars through fraudulent practices will now be answered by both a substantial sentence and restitution. More importantly, today’s sentence is another step in pursuit of justice for the patients and families that were deceived by Novus’ offerings and hospice services,” said FBI Dallas Special Agent in Charge Matthew DeSarno. “We are proud to continue our work with our state and federal partners to hold those who commit health care fraud accountable, and to seek justice for patients that are harmed in furtherance of fraud schemes.” According to his plea papers, Mr. Harris admitted that from 2012 to 2016, he billed Medicare and Medicaid for hospice services that were not provided, that were not directed by a medical professional, or that were provided to patients who were not actually eligible for hospice care.  He further admitted that he used blank, pre-signed controlled substance prescriptions to doll out potent drugs without physician input.

Mr. Harris admitted that two of his coconspirators, Dr. Mark Gibbs and Dr. Laila Hirjee, frequently certified that that his hospice patients faced terminal illnesses without actually examining with the patients in person, as required by Medicare. (A “terminal” patient is one with a life expectancy of six months or less, according to the Department of Health & Human Services.)

The doctors were paid around $150 for each false order they signed.

Mr. Harris also admitted that Dr. Gibbs, Dr. Hirjee, and another physician, Dr. Charles Leach, left him blank controlled substance prescriptions, sometimes a whole pad at a time. This allowed Mr. Harris, an accountant by trade, to “prescribe” Schedule II controlled substances to hospice beneficiaries without the guidance of a medical professional.

In plea papers, Mr. Harris admitted that in summer 2014, he realized he could avoid exceeding Medicare’s aggregate hospice cap by enrolling an influx of first-time hospice patients. So, he negotiated an agreement with a company called Express Medical that allowed him to access potential patient’s confidential medical information in return for using Express Medical for laboratory services and home health visits. His wife and other Novus staff then called on individuals that had at some point been patients of Express Medical to recruit them for Novus hospice services, regardless of whether they were eligible to receive benefits.

When the Center for Medicare & Medicaid Services suspended Novus based upon credible allegations of fraud, Mr. Harris and simply transferred patients from Novus to a new company, “Company A.”  Dr. Gibbs became a medical director for the “new” hospice company, which used Novus staff and transferred hospice reimbursements back to Novus, Mr. Harris admitted.  

Ten of Mr. Harris’ codefendants, including Dr. Leach, also pleaded guilty. Three more, including Dr. Gibbs and Dr. Hirjee, were found guilty at trial. Dr. Gibbs was sentenced to 13 years in federal prison and ordered to pay $27,978,903 in restitution; Dr. Hirjee was sentenced to  10 years in federal prison and ordered her to pay $16,253,281 in restitution; and Dr. Leach was sentenced to more than five years in federal prison and ordered to pay $10,077,709 in restitution.

The Federal Bureau of Investigation’s Dallas Field Office, the U.S. Department of Health & Human Services Office of Inspector General (HHS-OIG), and the Texas Attorney General’s Medicaid Fraud Control Unit conducted the investigation. Assistant U.S. Attorneys Donna Strittmatter Max and Marty Basu prosecuted the case with Assistant U.S. Attorneys Stephen Gilstrap, Gail Hayworth, and Brian McKay.

Four United Development Funding executives have been found guilty of fraud, announced U.S. Attorney for the Northern District of Texas Chad E. Meacham.

After five days of trial and almost 12 hours of deliberation, a federal jury convicted UDF CEO Hollis Morrison Greenlaw, UDF Partnership President Benjamin Lee Wissink, UDF CFO Cara Delin Obert, and UDF Asset Management Director Jeffrey Brandon Jester of ten counts, including conspiracy to commit wire fraud affecting a financial institution, conspiracy to commit securities fraud, and securities fraud.

“UDF executives shuffled money from one fund to another without disclosing the comingling to investors or regulators,” said U.S. Attorney Chad Meacham. “The Justice Department takes financial improprieties seriously, and we are proud to hold these defendants accountable for their crimes. After a long battle, justice has been done.”

"These executives conspired to commit multiple fraud schemes in order to mislead investors and the SEC, with multi-million dollar losses," said Matthew DeSarno, Special Agent in Charge of the FBI's Dallas Division.  "One of the FBI's goals is to investigate corporate fraud in order to protect market integrity and investor confidence in the U.S. markets. I would like to thank the agents, analysts, and forensic accountants who spent years investigating these allegations, and our partners at the U.S. Attorney's Office who worked to ensure justice in this case." 

According to evidence presented at trial, the defendants orchestrated a scheme to mislead investors and the SEC about their funds’ performance. 

Founded in 2003 and headquartered in Grapevine, UDF utilized a family of five funds – UDF I, II, III, IV, and V – to invest in various residential real estate developers and private homebuilders.

When developers failed to repay money they borrowed from one fund, triggering multi-million dollar shortfalls, the defendants transferred money out of another fund in order to pay distributions to the original fund’s investors, all without disclosing the transfers to the SEC and the investing public.

The defendants now face up to 25 years each in federal prison.

The Federal Bureau of Investigation’s Dallas Field Office conducted the investigation. Assistant U.S. Attorneys Tiffany H. Eggers (NDTX Criminal Chief), Rachael Jones, Elyse Lyons, and Errin Martin prosecuted the case. U.S. District Judge Reed C. O’Connor presided over the trial.

Reagor Dykes Auto Group’s Chief Financial Officer, Shane Andrew Smith, was sentenced today to seven years in federal prison for his role in a $50 million wire fraud conspiracy, announced U.S. Attorney for the Northern District of Texas Chad E. Meacham.

Mr. Smith, 45, pleaded guilty in June 2019 and was sentenced Thursday by U.S. District Judge Matthew J. Kacsmaryk, who also ordered him to pay $59,590,198.82 in restitution. The defendant will have to report to prison by 2 p.m. on Monday, March 28.

“By the time Mr. Smith was charged in 2019, Reagor Dykes was a cesspool of criminal schemes, from check kiting to dummy flooring,” said U.S. Attorney Chad Meacham. “We are proud of the work we’ve done to hold this defendant – and more than a dozen of his coworkers – accountable for their egregious behavior.”

"As a corporate executive, Mr. Smith meticulously conspired to defraud a lending institution, and the resulting loss to the industry was significant," said Matthew DeSarno, Special Agent in Charge of the FBI's Dallas Division. "One of the FBI's goals is to investigate fraud and protect public and investor confidence in our economy, and we will continue that endeavor with our partners."

The defendant was given credit for testifying in the trial of his former boss, Reagor Dykes owner Bart Reagor, who was convicted in October of making false statements to an FDIC-insured bank.  At that trial, Mr. Smith testified that Mr. Reagor and his partner, Rick Dykes, drew roughly $25 million out of the business for personal use, including roughly $3.3 million from a working capital bank loan intended for business use.

Prior to testifying against his Mr. Reagor, Mr. Smith admitted in plea papers to defrauding the auto group’s main lender, Ford Motor Credit Company (FMCC), and concealing the fraud by cross-depositing checks across several banks, a ploy known as check-kiting. 

In order to cover ballooning expenses, Mr. Smith admitted, he instructed Reagor Dykes accountants to engage in a practice they dubbed “dummy flooring.”

At his direction, accounting staff dug through records for vehicle identification numbers (VIN) of cars Reagor Dykes had already sold, then submitted new loan applications to FMCC using the old VINs – falsely indicating that the company was seeking a loan in order to repurchase the vehicle for resale.  Instead of re-buying the car, however, Reagor Dykes used the ensuing loan to cover other expenses.

“Whatever it takes, we need to floor anything and everything we can even think of to cover payoffs each day,” Mr. Smith wrote in an email quoted in his factual resume. 

To disguise the shortfall from the dummy flooring scheme, Mr. Smith and his employees engaged in check-kiting, artificially inflating the company’s bank account balances by cross-depositing insufficient checks.

Vendor and payroll checks that should have bounced were instead cleared during banks’ float time, the period between the deposit in the recipient account and the deduction from the payer’s account.

“The deposits we do each do [sic] will most likely cover the checks we write each other,” Mr. Smith wrote in an email.

Reagor Dykes also routinely violated a clause in its loan agreements that required them to repay FMCC within seven days of selling the vehicle for which the loan was issued, Mr. Smith admitted. 

Rather than cop to the delay, Reagor Dykes accountants created false paperwork, which they referred to as “dummy shucks,” in order to make it appear that the car had been sold more recently.

Mr. Smith is the fifteenth RDAG employee sentenced to more than 37 years combined in federal prison for the dummy flooring and check kiting scheme.  Reagor Dykes employees previously sentenced include:

• Diana Urias, an office manager in Reagor Dykes’ used car mall in Levelland, pleaded guilty to conspiracy to commit bank fraud and was sentenced to 2 years in federal prison and ordered to pay $19,335,901.10 in restitution, joint and severally.
   
• Sheila Miller, an RDAG group controller, pleaded guilty to conspiracy to commit bank fraud and was sentenced to 27 months in federal prison and ordered to pay $19,335,901.10 in restitution, joint and severally.
   
• Paige Johnston, an office manager in Reagor Dykes’ Chevrolet store in Floydada, pleaded guilty to conspiracy to commit wire fraud and was to 27 months in federal prison and ordered to pay $40,254,297.72 in restitution, joint and severally.

 

• Lindsay Williams, and RDAG group accounting manager, pleaded guilty to conspiracy to commit bank fraud and was sentenced to 27 months in federal prison and ordered to pay $19,335,901.10 in restitution, joint and severally.

 

• Sherri Wood, an office manager at Reagor Dykes’ Ford store in Plainview, pleaded guilty to conspiracy to commit wire fraud and was sentenced to 30 months in federal prison and ordered to pay $40,254,297.72 in restitution, joint and severally.

 

• Pepper Rickman, an accounting controller at Reagor Dykes’ Toyota store in Plainview, pleaded guilty to conspiracy to commit wire fraud and was sentenced to 4 years in federal prison and ordered to pay $40,254,297.72 in restitution, joint and severally.

 

• Brad Fansler, an RDAG group administrative director, pleaded guilty to conspiracy to commit wire fraud and was sentenced to 42 months in federal prison and ordered to pay $40,254,297.72 in restitution, joint and severally.

 

• Ashley Dunn, executive assistant to the CEO, pleaded guilty to conspiracy to commit bank fraud and was sentenced to 30 months in federal prison and ordered to pay $19,335,901.10 in restitution, joint and severally.

 

• Whitney Maldonado, an office manager at Reagor Dykes’ Mitsubishi store in Lubbock, pleaded guilty to conspiracy to commit wire fraud was sentenced on 27 months in federal prison and ordered to pay $40,254,297.72 in restitution, joint and severally.

 

• Elaina Cabral, an office manager at Reagor Dykes’ Toyota store in Plainview, pleaded guilty to conspiracy to commit wire fraud and was sentenced to 27 months in federal prison and ordered to pay $40,254,297.72 in restitution, joint and severally.

 

• Mistry Canady, an office manager at Reagor Dykes’ Ford store in Lamesa, pleaded guilty to conspiracy to commit wire fraud and was sentenced to 2 years in federal prison and ordered to pay $40,254,297.72 in restitution, joint and severally.

 

• Wesley Neel, RDAG Safety & Compliance Manager, pleaded guilty to conspiracy to commit wire fraud and was sentenced to 30 months in federal prison and ordered to pay $40,254,297.72 in restitution, joint and severally.

 

• Andrea Kate Phillips, an accounting associate and office manager at Reagor Dykes Ford Store in Plainview, pleaded guilty to misprison of a felony and was sentenced to four years’ probation and ordered to pay $40,254,297.72 in restitution, jointly and severally.

 

• Steven Reinhart, RDAG Legal Compliance Director, pleaded guilty in February 2021 to misprision of a felony and was sentenced to 6 months in federal prison and ordered to pay $40,254,297.72, jointly and severally.
   

Bart Reagor, 55, is still awaiting sentencing.

The Federal Bureau of Investigation and Internal Revenue Service - Criminal Investigation Division conducted the investigation. Magistrate Judge Lee Ann Reno presided over the plea. Assistant U.S. Attorneys Joshua Frausto, Jeffrey Haag, and Amy Burch are prosecuting the case.

A DFW radio DJ has been charged with producing sexually explicit images of a prepubescent child, announced U.S. Attorney for the Northern District of Texas Chad E. Meacham.

Clois Glenn Raborn, an 49-year-old radio personality known for occasional appearances on 97.1’s “The Russ Martin Show,” was charged Wednesday via criminal complaint with production of child pornography. He made his initial appearance before U.S. Magistrate Judge Jeffrey Cureton on Thursday afternoon. A detention hearing has been set for Wednesday morning.

The investigation began in March 2021, when Mr. Raborn’s roommate discovered lewd images of minor children on Mr. Raborn’s laptop.

According to the complaint, law enforcement conducted a forensic analysis of the laptop and found images of an adult male, believed to be Mr. Raborn, allegedly engaging in sexual conduct with young child.

The child’s mother confirmed her daughter’s identity based on images of her face and other items.  She also told law enforcement she recognized Mr. Raborn’s hand in some of the images.

She estimated that the child was between four to six years old when the images were taken.   

A criminal complaint is merely an allegation of wrongdoing, not evidence. Like all defendants, Mr. Raborn is presumed innocent until proven guilty in a court of law.

If convicted, he faces up to 30 years in federal prison.  

The U.S. Secret Service’s Dallas Field Office and the Euless Police Department conducted the investigation. Assistant U.S. Attorney Brandie Wade is prosecuting the case. 

Two men who allegedly kidnapped a 14-year-old girl off the streets of Dallas have been charged with producing sexually explicit images of the child, announced U.S. Attorney for the Northern District of Texas Chad E. Meacham.

Lukumond Olatunji, 43, and Vincent Thompson, 41, were arrested in Dallas on Wednesday and charged via criminal complaint with production of child pornography and aiding and abetting child pornography. They made their initial appearances in federal court before U.S. Magistrate Judge Irma C. Ramirez this afternoon.

According to the complaint, the defendants pulled up beside the 14-year-old Jane Doe as she was walking home from school in Southwest Dallas on Oct. 23. The child, who was wearing her school uniform at the time of the crime, later told investigators she believed they were going to give her a ride to her grandmother’s house.

Instead, the defendants drove her to an alley, where they allegedly raped her and recorded part of their crimes on Mr. Thompson’s cell phone. They then drove her to a motel, where they rented a room and allegedly raped her again.

Jane Doe was eventually able to escape.  As she ran from the hotel, she encountered a woman who drove her to a nearby gas station to call for help. Visibly scared and disoriented when officers arrived, the child was nevertheless able to describe the defendants and their attire to law enforcement.

Officers immediately drove to the motel and detained Mr. Olatunji and Mr. Thompson. In an interview, Mr. Olatunji identified Jane Doe as “the girl that Vincent picked up.” He initially denied sexually assaulting the child, but later admitted to having sexual intercourse with her. Mr. Thompson also identified Jane Doe as “the girl we picked up in South Dallas.” He admitted to engaging in sexual intercourse with the child and to recording her sexual assault on his phone.

A criminal complaint is merely an allegation of wrongdoing, not evidence. Mr. Olatunji and Mr. Thompson are presumed innocent until proven guilty in a court of law.

Homeland Security Investigations’ Dallas Field Office and the Dallas Police Department conducted the investigation. Assistant U.S. Attorney Joe Magliolo and Special Assistant U.S. Attorney Jenna Rudoff are prosecuting the case.

A Texas man was sentenced today to 30 years in prison followed by a lifetime of supervised release for producing images of child sexual abuse. As part of the sentence, the defendant will also pay more than $58,000 in restitution to victims.

Jason Paul White, 42, of Lubbock, pleaded guilty in September 2021 to production of child pornography. According to court documents, in 2009, when White was 29 years old, he persuaded a minor to engage in sexually explicit conduct for the purpose of producing a video. Specifically, White produced a video of himself performing oral sex on the minor, masturbating the minor using a sex device, and then having the minor masturbate White using the same sex device. White also produced child pornography videos of the same minor on approximately six other occasions. As part of his guilty plea, White also admitted to enticing six other minor boys to engage in sexual activity between 2004 (when White was 25) and 2020 (when White was 41). The boys ranged in age from 13 to 17 years old at the time White committed crimes against them.

Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division, Acting U.S. Attorney Chad Meacham for the Northern District of Texas, and Special Agent in Charge Matthew DeSarno of the FBI’s Dallas Field Office made the announcement.

Trial Attorney Austin M. Berry of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Callie Woolam of the Northern District of Texas are prosecuting the case.

The FBI’s Dallas Field Office, the Lubbock Police Department, and Homeland Security Investigations’ Dallas Field Office investigated the case, with assistance from the Department of Justice’s High Technology Investigative Unit.

This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the epidemic of child sexual exploitation and abuse, launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend, and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc.

A Lubbock dentist was sentenced today to 30 years in prison for producing images of child sexual abuse, announced U.S. Attorney for the Northern District of Texas Chad E. Meacham and Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division.

Jason Paul White, 42, pleaded guilty in September 2021 to production of child pornography. He was sentenced Thursday by U.S. District Judge James Wesley Hendrix, who also ordered him to pay more than $58,000 in restitution. 

According to court documents, in 2009, Mr. White (then 29) persuaded a 17-year-old boy to engage in sexually explicit conduct for the purpose of producing a video. He went on to produce child pornography videos of the same child on approximately six other occasions.

As part of his guilty plea, White also admitted to enticing six other minor boys to engage in sexual activity between 2004 (when White was 25) and 2020 (when White was 41). The boys ranged in age from 13 to 17 years old at the time White committed crimes against them.

At Thursday’s hearing, multiple victims testified that White groomed them, plying them with gifts and drugs to make them feel special. The defendant’s perpetual manipulation left victims with shame and trust issues, they said.

The FBI’s Dallas Field Office – Lubbock Resident Agency, the Lubbock Police Department, and Homeland Security Investigations’ Dallas Field Office investigated the case, with assistance from the Department of Justice’s High Technology Investigative Unit. Trial Attorney Austin M. Berry of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Callie Woolam of the Northern District of Texas prosecuted the case.

This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the epidemic of child sexual exploitation and abuse, launched in May 2006 by the Department of Justice. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc.

A Fort Worth man has been named a co-conspirator in retired FBI agent William Stone’s alleged scheme to con a local mother out of more than $700,000 by convincing her she was on “secret probation,” U.S. Attorney for the Northern District of Texas Chad E. Meacham announced today.

Joseph Eventino DeLeon, 63, was charged in a superseding indictment Tuesday with conspiracy to commit wire fraud. He is expected to make his initial appearance in federal court on Wednesday, Dec. 29.

Conspirator William Stone, 62, was first indicted in May for wire fraud, wire fraud conspiracy, false impersonation of a federal officer, and engaging in monetary transactions in property derived from unlawful activity. The superseding indictment, filed on Tuesday, adds Mr. DeLeon as a defendant in the wire fraud conspiracy.  

According to the superseding indictment, Mr. DeLeon allegedly conspired with Mr. Stone to convince their victim, a woman identified in court documents as C.T., that she was under “secret probation” for drug crimes in “Judge Anderson’s court in Austin, Texas.”

The pair allegedly told the victim that the fictious federal judge had appointed the two of them to “mentor” and “supervise” C.T. They required her to text them written reports of her daily activities and to compensate them for their supervisory services as well as any expenses they incurred. Over the course of several years, C.T. gave Mr. Stone more than $700,000 and Mr. DeLeon more than $50,000.

Mr. Stone and Mr. DeLeon insisted that C.T. was prohibited from disclosing her probation status to anyone, and would risk imprisonment and loss of her children if she did not comply with the terms of her probation.

In order to convince her the probation was real, the defendants allegedly persuaded C.T. that Mr. Stone had the ability to monitor her cell phone communications, stated that they had discussed C.T.’s probation with a psychiatrist, enlisted another person to impersonate the U.S. Drug Enforcement Administration “Intelligence Center” in a message inquiring about C.T., and even placed spoof calls between Mr. Stone, C.T., and the fictitious Judge Anderson.

They allegedly urged her to distance herself from her family, claiming her family members wanted to take her inheritance away from her, and persuaded her to transfer her inherited assets out of a trust and into an account under her own name. At one point, they allegedly claimed Judge Anderson would discharge C.T.’s probation if C.T. agreed to marry Mr. Stone. Mr. DeLeon even carried a weapon in C.T.’s home  while purportedly providing “protective services” for her.  

An indictment is merely an allegation of criminal conduct, not evidence. Both Mr. DeLeon and Mr. Stone are presumed innocent until proven guilty in a court of law.

If convicted, Mr. DeLeon faces up to 20 years in federal prison; Mr. Stone faces up to 178 years.

The Texas Rangers and the U.S. Department of Justice Office of Inspector General conducted the investigation with the assistance of the Fort Worth Police Department. Mr. Stone retired from the Federal Bureau of Investigation in October 2015.  Assistant U.S. Attorneys Marcus Busch and Katherine Miller are prosecuting the case.

The Department of Justice today announced nearly $126 million in funding to advance school safety under the STOP School Violence Act.

The grants, awarded by the Office of Justice Programs’ Bureau of Justice Assistance (BJA) and the department’s Office of Community Oriented Policing Services (COPS Office), will help institute safety measures in and around primary and secondary schools, support school violence prevention efforts, provide training to school personnel and students, and implement evidence-based threat assessments.

School Violence Prevention Program (SVVP) awards have been made to several entities in the Northern District of Texas, including:

• Eagle Mountain - Saginaw ISD – $500,000 (Tarrant County) 
• Wichita Falls Independent School District – $500,000 (Wichita Falls County)
• Campbell ISD – $139,247 (Hunt County)
• North Richland Hills Police Department – $82,793 (Tarrant County)
• Whiteface CISD – $75,000 (Cochran County)
• May Independent School District – $61,628 (Brown County)

 “The Justice Department has no greater responsibility than protecting Americans from harm,” said Attorney General Merrick B. Garland. “Schools must be safe places to learn, and today’s investment of more than $125 million under the STOP School Violence Act will help ensure that they are.”

The Students, Teachers and Officers Preventing School Violence Act of 2018, known as the STOP School Violence Act, gives the Justice Department the authority to provide awards directly to states, units of local government, Indian tribes, and public agencies (such as school districts and law enforcement agencies) to improve security at schools and on school grounds through evidence-based school safety programs. It also provides grants to ensure a positive school climate by helping students and teachers recognize, respond quickly to, and help prevent acts of violence.

The 78 BJA annual awards, totaling almost $74 million, are intended to support training and education for school personnel and students on preventing violence against others and themselves, including anti-bullying training and specialized training for school officials to respond to mental health crises. Funds also help develop and implement multidisciplinary threat assessment or intervention teams and design technology solutions such as anonymous reporting systems, hotlines and websites.

The COPS SVVP provides up to 75% of the funding for school safety measures in and around primary and secondary schools. The 153 SVPP awards, totaling almost $52 million, are statutorily obligated to be used for coordination with law enforcement; training for local law enforcement officers to prevent student violence; locks, lighting and other deterrent measures; technology for expedited notification of local law enforcement during an emergency; and other measures that provide a significant improvement in security.

The full list of SVPP awards can be found here:  https://cops.usdoj.gov/svpp-award.  A list of BJA awards, as they are made, can be found on the OJP Grant Awards page.

The COPS Office is the federal component of the Department of Justice responsible for advancing community policing nationwide. The only Department of Justice agency with policing in its name, the COPS Office was established in 1994 and has been the cornerstone of the nation’s crime fighting strategy with grants, a variety of knowledge resource products, and training and technical assistance. Through the years, the COPS Office has become the go-to agency for law enforcement agencies across the country and continues to listen to the field and provide the resources that are needed to reduce crime and build trust between law enforcement and the communities served. The COPS Office has invested more than $14 billion to advance community policing, including grants awarded to more than 13,000 state, local and tribal law enforcement agencies to fund the hiring and redeployment of more than 135,000 officers. 

The Office of Justice Programs provides federal leadership, grants, training, technical assistance and other resources to improve the nation’s capacity to prevent and reduce crime, advance racial equity in the administration of justice, assist victims and enhance the rule of law. More information about OJP and its components can be found at www.ojp.gov.

An Irving man was sentenced today to 14 years in federal prison for possession of multiple unregistered machine gun conversion sears as well as numerous drug crimes, announced U.S. Attorney for the Northern District of Texas Chad E. Meacham.

Ramon Navarro III, 23, pleaded guilty in March to four counts of an unregistered firearm and eight counts of distribution of controlled substances.  Because the government did not offer Mr. Navarro a plea deal, he pleaded open to the charges against him, with no assurances as to the term of imprisonment prosecutors would recommend to the judge. He was sentenced Monday by U.S. District Judge Sam A Lindsay.

According to court documents, Mr. Navarro, who used the aka “Trae Alvarez,” admitted that he possessed four machine gun conversion sears, three-piece devices designed to convert semiautomatic weapons into machineguns, all lacking serial numbers and of unknown origin. He also possessed six Glock pistols, each with an incorporated conversion sear, transforming the firearms into machine guns in operating condition.

(Unlike semiautomatic firearms, machineguns – weapons that can shoot more than one shot, without manual reloading, by single function of the trigger – are generally unlawful for civilians under the National Firearms Act.)

None of the firearms were registered to Mr. Navarro in the National Firearms Registration and Transfer Record, he admitted. He also admitted to trafficking in cocaine and heroin.

“This investigation is an example of ATF’s steadfast commitment to working with Dallas Police Department and all our local, state, and federal law enforcement partners in combining resources to combat violent crime, disrupt firearms trafficking, and ultimately create safer communities,” stated Jamey VanVliet,  Assistant Special Agent in Charge of the ATF’s Dallas Field Division.

The Bureau of Alcohol, Tobacco, Firearms & Explosives’ Dallas Field Division and the Dallas Police Department. Assistant U.S. Attorney Linda Requénez is prosecuting the case with the assistance of Assistant U.S. Attorney Walt Junker.

This case was prosecuted under Project Guardian, a Department of Justice initiative aimed at reducing gun violence by enforcing federal firearm laws through coordination between the federal government and state and local law enforcement.

The U.S. Attorney’s Office for the Northern District of Texas has filed federal charges against one of the world’s largest alleged anabolic steroid producers, U.S. Attorney Chad E. Meacham announced today.

Chuen Fat Yip, a 68-year-old citizen of the People’s Republic of China (PRC) also known as Ye Chuan Fa, was charged in September 2018 with five drug crimes, including conspiracy to possess with intent to distribute anabolic steroids, conspiracy to possess with intent to distribute fentanyl precursor, conspiracy to import anabolic steroids, and manufacturing anabolic steroids and fentanyl precursor with the knowledge that they will be unlawfully imported. The indictment against Yip and two coconspirators was unsealed on March 11, 2021.  On Nov. 18, 2021, the U.S. Attorney’s Office obtained a seizure warrant for more than 49.1 bitcoin – currently worth approximately $2.3 million – from a crypto wallet that traced back to Yip.  

“We cannot allow foreign nationals to flood the United States with dangerous drugs,” said U.S. Attorney Chad Meacham. “This defendant allegedly made millions manufacturing and distributing anabolic steroids and fentanyl precursors to American customers. The Justice Department will pursue drug defendants to the furthest reaches of the globe if that’s what it takes to stem the tide of the drug epidemic.”

“Transnational criminal organizations seek to threaten our health and safety by importing dangerous drugs and chemicals, such as fentanyl. DEA’s mission to seek justice must be worldwide when combatting this threat,” said DEA Special Agent in Charge, Eduardo A. Chávez.  “The YC Group allegedly utilized global logistics for personal gain while profiting from those individuals vulnerable to the dangers of drug abuse. Mr. Yip’s alleged criminal activities have caught up with him and DEA Fort Worth will use every tool, every law enforcement partner, and every community resource to ensure he and his conspirators are held accountable.”

According to court documents, Yip – who is believed to reside in Wuhan City, Hubei Provence, PRC – allegedly owned and operated the Yuancheng (YC) Group, a chemical manufacturing company responsible for producing and distributing approximately $280 million worth of anabolic steroids, including $55 million worth of anabolic steroids shipped to the United States over a five-year period.

The YC Group allegedly advertised the sale of illegal controlled substances at trade shows and on a variety of websites, including sellsteroids.com, steroidsmart.com, and pharmade.com. In October 2015, Yip allegedly attended a trade show in the United States, bringing his company vice president and a sales manager with him. His underlings allegedly met with customers and negotiated transactions involving more than 100 kilograms. During those meetings, they acknowledged the U.S. Drug Enforcement Administration (DEA)’s efforts to stem the flow of anabolic steroids and outlined steps the customers needed to avoid detection.  

Following production of the steroids and other controlled substances, the YC Group allegedly shipped the contraband out of Shanghai or Hong Kong to locations around the globe, including 84 foreign counties and all 50 U.S. states. They shipped parcels weighing less than 50 kilograms via commercial air carries, including the U.S. Postal Service, and used cargo vessels to transport shipments weighing more than 50 kilograms. Shipments were typically disguised in packaging intended to resemble other products, such as food.

On one occasion, the YC Group allegedly agreed to ship approximately 24 kilograms of 4-ANPP, a precursor for fentanyl, from the PRC to the United States. The conspirators also allegedly agreed that the precursor would then be smuggled from the United States to Mexico, where it would be combined with other chemicals to produce fentanyl, then smuggled back into the United States, where it would be distributed to dealers and end-users.

The U.S. Department of State is offering a reward of up to $5 million for information leading to the arrest and/or conviction of Chuen Fat Yip, aka “Chuan Fa Ye,” or for information leading to the disruption of financial mechanisms of Yip’s alleged transnational organized crime group, the Yuancheng (YC) Group.  If you have information, please contact the DEA at +1-972-591-1326 via text/WhatsApp/Telegram/ Signal, or by email at ChuenFatYipTIPS@dea.gov.  If in the United States, please contact the local DEA office in your city. 

 

The DEA’s Dallas Field Division - Fort Worth District Office conducted the investigation. Essential support and coordination was provided by the Department of Justice’s multi-agency Special Operations Division in coordination with DEA’s Denver Field Division, Cyber Support Section, and Near East Region, including assigned attorneys from the Criminal Division’s Narcotic and Dangerous Drug Section. The Justice Department’s Office of International Affairs and the Criminal Division’s Money Laundering and Asset Recovery Section’s Digital Currency Initiative provided assistance. Assistant U.S. Attorney P.J. Meitl is prosecuting the case.

An indictment is merely an allegation, and a defendant is presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

The Department of Justice announced today that it has awarded more than $17.5 million in grants – including more than $378,000 in the Northern District of Texas – to support the Project Safe Neighborhoods (PSN) Program. Funding will support efforts across the country to address violent crime, including the gun violence that is often at its core.

Fort Worth’s Safe City Commission, also known as One Safe Place, will handle the Northern District of Texas PSN funds, which will be distributed to police departments and nonprofits that support the PSN mission through enforcement and crime prevention programs.

The Bureau of Justice Assistance (BJA), part of the department’s Office of Justice Programs (OJP), will administer the 88 grant awards, which are being made to designated fiscal agents to support local PSN projects that work in partnership with U.S. Attorneys’ Offices. With approval from BJA, the Safe City Commission, the Northern District of Texas’s fiscal agent, will begin the process of making subawards for PSN grant projects.

“I am immensely proud of the Northern District of Texas’ award-winning PSN program, which relies on collaboration between federal, state, and local law enforcement and area nonprofits to reduce violent crime,” said U.S. Attorney Chad E. Meacham. “Our data-driven, compassionate approach ensures that our residents feel safe in their communities. We’re focused not just on locking up criminals, but at getting to the root cause of violence and stopping it. We’re determined to make Dallas, Fort Worth, Lubbock and Amarillo better places to live and work, and we’re hopeful this grant money will help us achieve that goal.”

“This latest Project Safe Neighborhoods grant is critical to addressing the violent crime threatening cities and towns all across our country,” said Deputy Attorney General Lisa O. Monaco. “Ensuring the safety of all Americans is the highest priority for the Department of Justice, but when it comes to violent crime, there is not a one-size-fits-all solution. We have to work closely with local public safety agencies as well as community organizations to craft individual strategies unique to each community’s needs. Programs like Project Safe Neighborhoods and the funding it provides allow us to do just that.”

In May 2021, Attorney General Merrick B. Garland announced a new effort to reduce violent crime, including the gun violence that is often at its core. Integral to that effort was the reinvigoration of PSN, a two-decade old evidence-based and community-oriented program focused on reducing violent crime. The updated PSN approach, outlined in the department’s Comprehensive Strategy for Reducing Violent Crime issued by Deputy Attorney General Monaco, is guided by four key principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence, setting focused and strategic enforcement priorities and measuring the results of our efforts. The fundamental goal is to reduce violent crime, not simply to increase the number of arrests or prosecutions.

This fall, U.S. Attorney’s Offices across the country have enhanced their violent crime reduction efforts to ensure alignment with the department’s comprehensive violent crime reduction strategy. U.S. Attorneys’ Offices have engaged in outreach to law enforcement and other agencies and organizations serving communities to identify the most significant drivers of violence in their districts. Working together with a broad coalition of stakeholders, the U.S. Attorneys’ Offices are addressing the most pressing violent crime issues in their district to make our neighborhoods safer for all.

PSN programs are led by U.S. Attorneys’ Offices in collaboration with local public safety agencies, community stakeholders and other agencies and organizations that work to reduce violent crime. You can read more about the Northern District of Texas’ PSN program here. For a list of all PSN grantees nationwide, click here.

A heroin trafficker who fled the scene of a controlled delivery has been sentenced to 14 years in federal prison, announced U.S. Attorney for the Northern District of Texas Chad E. Meacham.

Frank Alex Juarez, 22, of Terrell, Texas, pleaded guilty in July to possession with intent to distribute heroin. He was sentenced Wednesday by U.S. District Judge Ada Brown.

According to plea papers, Mr. Juarez admitted that he received more than 100 grams of heroin during an controlled delivery managed by the DEA on Sept. 10, 2020.

During the delivery, the defendant became nervous and fled from law enforcement at a high rate of speed.

Later, he delivered the heroin to another person. (This is an ongoing investigation.)

The Drug Enforcement Administration’s Dallas Field Division conducted the investigation with the assistance of the U.S. Marshals Service, the U.S. Postal Inspection Service, and the Mesquite Police Department. Assistant U.S. Attorney George Leal prosecuted the case.

The case stems from an Organized Crime Drug Enforcement Task Forces (OCDETF) Strike Force Initiative, which provides for the establishment of permanent multi-agency task force teams that work side-by-side in the same location. This co-located model enables agents from different agencies to collaborate on intelligence-driven, multi-jurisdictional operations to disrupt and dismantle the most significant drug traffickers, money launderers, gangs, and transnational criminal organizations.

A major Dallas drug trafficker was convicted at trial of dealing methamphetamine out of his car dealership, announced U.S. Attorney for the Northern District of Texas Chad E. Meacham.

After four days of trial, a federal jury convicted Marco Antonio Gonzalez, 42, of one count of conspiracy to possess with intent to distribute a controlled substance, two counts of possession with intent to distribute a controlled substance, and one count of possession of a firearm by a convicted felon.

"Today’s conviction is an affirmation of DEA resolve to keep methamphetamines out of our communities, said Eduardo A. Chávez, Special Agent in Charge of the DEA Dallas Field Division. “Methamphetamine continues to be a significant threat in North Texas. DEA and all our law enforcement partners will continue to hold those like Mr. Gonzalez accountable for their actions.”

According to evidence presented at trial, Mr. Gonzalez, an associate of the Jalisco New Generation Cartel (CJNG) who called himself “Speedy,” dealt methamphetamine out of Hampton Motors, a car dealership he owned. He and several coconspirators stored large quantities of narcotics at the dealership and used proceeds of drug sales to purchase vehicles in order to disguise the source of the funds.

The defendants used homes in Dallas and DeSoto to serve as laboratories for the recrystallization of methamphetamine, and often carried firearms on those premises. Agents testified at trial that members of the cartel trafficked thousands of kilograms of methamphetamine this way.

During trial, prosecutors discovered that Mr. Gonzalez threatened to kill one of his co-conspirators, who was slated to testify against him. The threatened man went on to testify anyway, saying that Mr. Gonzalez used his dealership as a front for large-scale drug deals.

Marco Gonzalez now faces up to life federal prison. Ten of his co-conspirators entered guilty pleas prior to trial.

The Drug Enforcement Administration’s Dallas Field Division and the Dallas Police Department conducted the investigation with the assistance of the Garland Police Department and the Ellis County Sheriff’s Office. Assistant U.S. Attorneys P.J. Meitl and John Kull prosecuted the case. U.S. District Judge Brantley Starr presided over trial.

An Amarillo man who threatened to execute three prominent Jewish rabbis has been federally charged, announced U.S. Attorney for the Northern District of Texas Chad E. Meacham. The defendant’s girlfriend, who pointed a gun at federal agents during his arrest, has been charged as well. 

Christopher Stephen Brown, 37, was arrested Wednesday, charged via criminal complaint with interstate threatening communications. His girlfriend, Rebekah Jones, 28, was charged via criminal complaint with assaulting a federal officer with a deadly weapon during the arrest. The pair made their initial appearance in federal court before U.S. Magistrate Judge Lee Ann Reno Thursday afternoon.

“Mr. Brown’s anti-Semitic statements were both disgusting and unlawful. The First Amendment may guarantee the right to make hateful remarks, but it does not allow for specific threats of violence against individuals. The circumstances of the defendant’s arrest only reinforce our belief that Mr. Brown poses a serious threat to the community,” said U.S. Attorney Chad Meacham. “We are committed to protecting all of our citizens – especially those who are often persecuted.” 

“Mr. Brown allegedly expressed an intent to commit violent acts toward numerous entities including private citizens, law enforcement and Jewish Rabbis associated with Chabad Lubavitch Headquarters,” said FBI Dallas Special Agent in Charge Matthew J. DeSarno. “Threatening statements are a serious criminal activity with consequences, and the FBI and our law enforcement partners will pursue those who pose a threat to the community when those threats intend to instill fear and potentially cause physical harm.”

According to the complaint, on Dec. 2, Mr. Brown allegedly contacted Chabad Lubavitch, a Jewish organization that has provided spiritual guidance and assistance to Jewish people since before the Holocaust.  Chabad is headquartered in New York City and maintains more than 3,500 institutions worldwide.

In a message sent via their website, Mr. Brown allegedly threatened to kill members of the Beth-Din, a Jewish rabbinical court. The message – which called for death to all Jews – also included a link to a video on Mr. Brown’s YouTube channel, “Dr M Obidiah.” On the channel, Mr. Brown, calling himself Madrikh Obidiah, said the Chabad Lubavitch chairman, vice chairman, and another leader's son must die.

Two days later, on Dec. 4, Mr. Brown called Chabad Lubavitch headquarters in New York and allegedly left two voicemail messages stating that Madrikh Obidiah would “tear out” the rabbis’ eyes and tongues and kill every rabbi he could find.  The following day, he called the headquarters again and allegedly threatened to blow the leaders heads off.

On Dec. 8, law enforcement arrived at Mr. Brown’s apartment to arrest him. They activated their emergency lights and used a PA system to order Mr. Brown out of his residence. After approximately one minute, Mr. Brown appeared at the door. He repeatedly refused to obey agents’ commands. Eventually, agents entered the apartment and grabbed Brown, who resisted being placed in handcuffs.

During the struggle, Ms. Jones locked arms with Mr. Brown and tried to pull him into the bedroom. She pointed a gun at an FBI agent, who grabbed the gun and attempted to point it in a safe direction. While wrestling with both Mr. Brown and Ms. Jones, the agent was eventually able to free the gun and fling it onto the floor.

The pair was subdued without injury.

A criminal complaint is merely an allegation of wrongdoing, not evidence. Like all defendants, Mr. Brown and Ms. Jones are presumed innocent until proven guilty.

If convicted, Mr. Brown faces up to 5 years in federal prison. Ms. Jones faces up to 20 years.

The Federal Bureau of Investigation’s Dallas Field Office, Amarillo Resident Agency and the Randall County Sheriff’s Office conducted the investigation in partnership with the FBI’s New York Field Office and the New York Police Department. Assistant U.S. Attorney Joshua Frausto is prosecuting the case.

A Lubbock man who threatened to kill his ex-wife has been federally charged, announced U.S. Attorney Chad E. Meacham.

Gene Garcia Solis, 48, was charged last Friday via criminal complaint with interstate threatening communications. He had his initial appearance before U.S. Magistrate Judge D. Gordon Bryant, Jr. on Monday, Dec. 6, at which point the case against him was unsealed.

According to court documents, a Lubbock Police Officer contacted Mr. Solis on Nov. 24, 2021 to check on his welfare. Mr. Solis was distraught and allegedly told the officer he planned to kill his ex-wife and anyone who tried to stop him and then commit suicide.

Fearing for his ex-wife’s safety, officers set up surveillance at her residence.

At around 10:30 p.m., Mr. Solis allegedly drove by the residence. When officers attempted to stop his car, he fled. Nearly three hours later, law enforcement spotted the defendant in Hale Center, Texas, and once again attempted to stop his car. He attempted to flee, but hit a spike strip and crashed in the parking lot of a Texas National Guard Armory.

Mr. Solis exited the vehicle, fired several rounds from an AR 15-style rifle, and ran inside the Armory.

“Mr. Solis's actions endangered the life of his ex-wife, the law enforcement officers who responded to multiple scenes and the public at-large,” said FBI Dallas Special Agent in Charge Matthew DeSarno. “Together with our law enforcement partners, the FBI’s priority is to protect and keep the communities we serve safe from harm.”

A criminal complaint is merely an allegation of criminal conduct, not evidence. Like all defendants, Mr. Solis is presumed innocent until proven guilty in a court of law.

The Federal Bureau of Investigation’s Dallas Field Office, Lubbock Resident Agency and the Lubbock Police Department conducted the investigation with the assistance of the Hale County Sheriff’s Department. Assistant U.S. Attorneys Jeff Haag and Callie Woolam are prosecuting the case.

Two doctors who helped a local hospice agency scam Medicare were sentenced today to a combined 23 years in prison for healthcare fraud, announced U.S. Attorney for the Northern District of Texas Chad E. Meacham.

In May, a federal jury found Novus Health Services Medical Directors Dr. Mark E. Gibbs and Dr. Laila Hirjee, along with Novus RN Tammie Little, guilty of conspiracy to commit healthcare fraud and other charges. Today, Chief U.S. District Judge Barbara M.G. Lynn sentenced Dr. Gibbs to 13 years in federal prison and ordered him to pay $27,978,903 in restitution; she sentenced Dr. Hirjee to 10 years in federal prison and ordered her to pay $16,253,281 in restitution. The judge also sentenced Ms. Little to 33 months in federal prison. 

According to evidence presented at trial, the defendants helped Novus CEO Bradley Harris defraud Medicare by, among other things, illegally admitting patients who were not appropriate for hospice and submitting materially false claims for hospice services.

Mr. Harris, who pleaded guilty prior to trial, testified against his former employees.

He told the jury that instead of relying on the expertise of licensed medical professions, he and Novus nurses determined which patients would be admitted to or discharged from hospice care, as well as which drugs and dosages they would receive.

They relied upon Novus doctors, including Dr. Gibbs and Dr. Hirjee, to certify that they had examined these patients face-to-face, when no such examinations had occurred, Mr. Harris testified.

Witnesses also testified that Dr. Hirjee and Dr. Gibbs engaged in the prescription of Schedule II controlled substances, such as morphine, hydromorphone, and fentanyl, by pre-signing blank C2 prescriptions and giving those to Brad Harris and others at Novus to let them prescribe controlled substances without any physician oversight.

As Director of Operations Melanie Murphey testified on day five of trial, “I was the doctor.”

Mr. Harris and the nurses used pre-signed prescription pads, prepared by Dr. Gibbs, Dr. Hirjee, and other Novus doctors, to dispense medications like morphine to patients.  When Medicare suspended payment to Novus over concerns about billing, Mr. Harris, Dr. Gibbs, and others moved patients and employees to a new hospice company and continued to bill Medicare for hospice services.

In total, Medicare and Medicaid paid the Novus entities approximately $40 million dollars for hospice services before the companies were shut down.

“These doctors allowed Bradley Harris – an accountant with no medical expertise – to dispense controlled substances like candy, with little to no medical oversight,” said U.S. Attorney Chad Meacham. “They claimed to have had hands-on experience with hospice patients, when in fact, they’d entrusted life-or-death medical decisions to untrained businesspeople. We are satisfied to know they will spend the next decade behind bars.”

“The defendants violated their Hippocratic Oath as doctors and instead focused on lining their pockets at the expense of patient safety. This case highlights the importance of thoroughly investigating any complaint of healthcare fraud,” said FBI Dallas Special Agent in Charge Matthew DeSarno. “We encourage the public to help us identify, investigate, and prosecute this crime. If you suspect health care fraud, report it to the FBI at tips.fbi.gov, 1-800-CALL-FBI, or contact your health insurance provider.”

Several of their codefendants – Novus CEO Brad Harris, his wife, Novus Vice President of Patient Services Amy Harris, Novus Director of Operations Melanie Murphy, Novus Medical Director Charles Leach, Novus Medical Director Reziuddin Siddique (deceased), Novus Vice President of Marketing Samuel Anderson, Novus Director of Marketing Slade Brown, Novus RN Jessica Love, Novus triage RN Patricia Armstrong, Novus LVN Taryn Stewart, and Ali Rizvi, the owner of a separate physician home visit company – pleaded guilty to various offenses prior to trial. Love was sentenced 102 months, Stuart was sentenced to 96 months, Armstrong was sentenced to 84 months, Dr. Leach was sentenced to 57 months, and Anderson was sentenced to 33 months.  The remaining defendants are facing statutory maximums of between two and 14 years in federal prison.

The Federal Bureau of Investigation’s Dallas Field Office, the U.S. Department of Health & Human Services Office of Inspector General (HHS-OIG), and the Texas Attorney General’s Medicaid Fraud Control Unit conducted the investigation. Assistant U.S. Attorneys Donna Strittmatter Max and Marty Basu are prosecuting the case with Assistant U.S. Attorneys Stephen Gilstrap, Gail Hayworth, and Brian McKay.

Flower Mound Hospital Partners LLC (Flower Mound Hospital), a partially physician-owned hospital in Flower Mound, Texas, has agreed to pay $18.2 million to resolve allegations that it violated the False Claims Act by knowingly submitting claims to the Medicare, Medicaid and TRICARE programs that resulted from violations of the Physician Self-Referral Law and the Anti‑Kickback Statute.

The Physician Self‑Referral Law, commonly known as the Stark Law, prohibits a hospital from billing for certain services referred by physicians with whom the hospital has a financial relationship, unless that relationship satisfies one of the law’s statutory or regulatory exceptions. The Anti‑Kickback Statute prohibits offering or paying remuneration to induce the referral of items or services covered by Medicare, Medicaid and other federally funded programs. Both the Stark Law and the Anti-Kickback Statute are intended to ensure that medical judgments are not compromised by improper financial inducements.

The settlement resolves allegations that Flower Mound Hospital violated the Stark Law and the Anti-Kickback Statute when it repurchased shares from physician-owners aged 63 or older and then resold those shares to younger physicians. The United States alleges that Flower Mound Hospital impermissibly took into account the volume or value of certain physicians’ referrals when it (1) selected the physicians to whom the shares would be resold and (2) determined the number of shares each physician would receive.

“Improper financial arrangements between hospitals and physicians can distort physician decision-making and drive up health care costs for everybody,” said Acting Assistant Attorney General Brian M. Boynton of the Justice Department’s Civil Division. “Patients deserve the independent and objective judgment of their health care professionals”

“The Stark Law and the Anti-Kickback Statute are designed to ensure that physician financial considerations can never influence patient care,” said U.S. Attorney Chad E. Meacham for the Northern District of Texas. “The system relies in part on whistleblowers who come forward to report financial improprieties at their workplaces. We urge anyone with concerns to reach out. The Justice Department is committed to enforcing laws that safeguard patient interests.”

“To deliver optimal patient care and protect the integrity of federal health care programs, providers should dutifully operate in accordance with the Stark Law and Anti-Kickback Statute,” said Special Agent in Charge Miranda Bennett of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG). “Providers are expected to deliver and bill for services based on their medical appropriateness and necessity, not their potential profitability. HHS-OIG and our partners are committed to enforcing these safeguards for HHS programs and beneficiaries.”

“Today’s outcome highlights the commitment of the Department of Defense Office of Inspector General, Defense Criminal Investigative Service (DCIS) and our law enforcement partners to protecting the integrity of our federal healthcare programs, including the Department of Defense’s healthcare program, TRICARE,” said Special Agent in Charge Michael C. Mentavlos of the DCIS Southwest Field Office. “DCIS will aggressively investigate companies and individuals that attempt to defraud taxpayer-funded healthcare programs, particularly those programs intended to care for our warfighters, their family members and our military retirees.”

Medicaid is funded jointly by the states and the federal government. The State of Texas paid for a portion of the Medicaid claims at issue and will receive a total of approximately $500,000 from the settlement with Flower Mound Hospital.        

In connection with the settlement, Flower Mound Hospital entered into a five-year Corporate Integrity Agreement (CIA) with the HHS-OIG. The CIA requires, among other things, that Flower Mound Hospital maintain a compliance program and hire an Independent Review Organization to review arrangements entered into by or on behalf of the hospital. It also increases individual accountability by requiring compliance-related certifications from key executives.

The civil settlement includes the resolution of claims brought under the qui tam or whistleblower provisions of the False Claims Act by Leslie Jennings, M.D., a physician-owner at Flower Mound Hospital. Under those provisions, a private party can file an action on behalf of the United States and receive a portion of any recovery. Dr. Jennings will receive approximately $3 million as his share of the recovery in this case. The qui tam case is captioned United States ex rel. Jennings v. Flower Mound Hospital Partners, LLC, et al., Civil Action No. 3-19-CV-02676-B (N.D. Tex.). 

The resolution obtained in this matter was the result of a coordinated effort between the Justice Department’s Civil Division, Commercial Litigation Branch, Fraud Section, and the U.S. Attorney’s Office for the Northern District of Texas with assistance from HHS-OIG and DCIS.

The investigation and resolution of this matter illustrates the government’s emphasis on combating healthcare fraud. One of the most powerful tools in this effort is the False Claims Act.  Tips and complaints from all sources about potential fraud, waste, abuse and mismanagement can be reported to the Department of Health and Human Services at 800-HHS-TIPS (800-447-8477).

The matter was handled by Trial Attorney Jonathan Thrope and Assistant U.S. Attorney Kenneth Coffin.

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

The University of Texas Southwestern Medical Center has agreed to pay $4.5 million to resolve allegations that its violations of the Controlled Substances Act allowed hospital staff to divert fentanyl and other dangerous drugs from the hospital, announced U.S. Attorney for the Northern District of Texas Chad E. Meacham.

The civil settlement – which also includes an extensive corrective action plan – is the culmination of a three-year-long joint DEA and U.S. Attorney’s Office investigation of UTSW’s handling of controlled substances, which began in December 2018 after two UTSW nurses overdosed on fentanyl and died at UTSW’s Clements University Hospital.  This marks the largest settlement involving allegations of drug diversion at a hospital in the state of Texas and the second largest in the nation.

“For years prior to our investigation, U.T. Southwestern exhibited an almost shocking disregard for its obligations under the Controlled Substance Act, enabling some employees to steal and abuse prescription narcotics – including powerful synthetic opioids such as fentanyl.  We felt that the serial compliance failures we uncovered warranted a multi-million-dollar penalty and a stringent corrective action plan,” said U.S. Attorney Chad Meacham. “In this settlement agreement, we’re doing everything in our power to mitigate the threat of opioid diversion by outlining protocols above and beyond what’s required by law.”

“U.T. Southwestern has an obligation to keep the highest standard of care for their patients. They also have an obligation of internal safeguards to keep controlled substances from being diverted,” said DEA Dallas Special Agent in Charge, Eduardo A. Chávez.  “Opioids, like fentanyl, do not discriminate in its addictive properties when diverted or taken outside the direction and supervision of medical professionals.  In this time of record overdose deaths, health care systems must be held to compliance with the Controlled Substances Act.  This is not only their legal responsibility, but also a matter of public trust and public safety. DEA Dallas pledges that we will tirelessly work with our law enforcement and regulatory partners to ensure these rules and regulations are followed to combat the opioid epidemic.”

In settlement documents, the government contends that UTSW violated multiple provisions of the Controlled Substances Act (CSA) over a five-year period, and that as a result UTSW employees were able to divert controlled substances – including fentanyl — from UTSW’s Clements University Hospital and Zale Lipshy Pavilion.

As a DEA registrant, UTSW had certain recordkeeping and reporting obligations which included monitoring all controlled substance activity within its facilities and promptly notifying the DEA whenever a theft or significant loss occurred.  The DEA determined that UTSW’s failure to meet certain of these recordkeeping and reporting obligations, along with the medical center’s failure to maintain effective controls to consistently detect and monitor suspected diversion, contributed to the health system’s overall failure to “guard against the theft and diversion of controlled substances.” 

During its investigation, the DEA identified incidents in which registered nurses diverted controlled substances from UTSW over significant periods of time. Tragically, two such diversions resulted in fatal overdoses.

On Dec. 15, 2016, a UTSW nurse overdosed on fentanyl diverted from UTSW’s Clements University Hospital and was found deceased in a hospital bathroom.  Roughly 16 months later, on April 16, 2018, another UTSW nurse overdosed on diverted opioids, including fentanyl, and was found deceased in a different Clements Hospital bathroom. 

According to the settlement documents, although UTSW did report certain instances of theft and loss to the DEA, it did not do so in a timely manner.  It also failed to properly document the dispensing and “wasting” of controlled substances – an essential safeguard against diversion – and made errors in forms documenting the ordering, receipt, and distribution of controlled substances – all violations of the CSA.

As part of the settlement, the medical center agreed to take significant steps to mitigate its diversion issues.  These steps, outlined in a three-year memorandum of agreement between UTSW and the DEA, include:

• Hiring an external auditor to conduct unannounced audits of controlled substances dispensed via pyxis machines (with a particular focus on auditing fentanyl), with any resulting deficiencies or discrepancies resolved in thirty days, signed off on by the Pharmacist-in-Charge, and provided to DEA;
   
• Instituting a training program designed to help employees identify symptoms of addiction and signs of diversion, and to understand the threat diversion poses to patient care and professional reputation;
   
• Creating an employee compliance hotline that permits anonymous reporting of suspected drug diversion or drug impairment;
   
• Installing security cameras at pyxis machines and providing footage to the DEA upon request;
   
• Establishing a database of employees who have been discharged or resigned because of drug diversion, and disclosing relevant information to requesting health facilities conducting pre-employment inquiries; and
   
• Permitting DEA personnel to enter UTSW facilities at any time, without prior notice and without a warrant, to verify compliance.

Much of the conduct outlined in the settlement agreement is merely alleged; the agreement does not constitute an admission of liability by UTSW.  However, UTSW does publicly acknowledge and admit that theft and significant loss of controlled substances occurred at Clements University Hospital and Zale Lipshy Pavilion; that UTSW failed to notify the DEA of these thefts and losses in a timely manner; and that some of UTSW’s policies and procedures were not consistent with the requirements of the CSA.

UTSW cooperated with the DEA’s investigation.  After the agency launched its probe into the medical center’s compliance program in December 2018, UTSW began working with the DEA to address deficiencies and strengthen its controls for handling controlled substances. A number of changes were instituted well before the settlement agreement was signed.

A main objective of the CSA, 21 U.S.C. §§ 801–904, is controlling illegitimate traffic in controlled substances.  To prevent the diversion of controlled substances, the CSA regulates persons, companies and other entities that manufacture, distribute, and dispense controlled substances.  With more than 100,000 Americans dying last year from drug overdose, the Justice Department and the DEA are committed to using every resource available to prevent overdose deaths and hold accountable those responsible for the opioid crisis.  The government’s rigorous investigation and resolution of this matter illustrates the government’s ongoing dedication to stem the prescription opioid crisis by ensuring that opioids are not diverted and abused.

This matter was investigated by the DEA’s Dallas Diversion Squad and Assistant U.S. Attorneys Andrew Robbins and Kenneth Coffin, with oversight from the Northern District of Texas First Assistant Scott Hogan.

A copy of the Settlement Agreement, which includes the Memorandum of Agreement, is attached below. Medical workers with concerns about prescription drug abuse or diversion can report it to the DEA here.

A San Angelo man has been sentenced to 30 years in federal prison for producing sexually explicit images of children – the statutory maximum sentence for that crime, announced U.S. Attorney for the Northern District of Texas Chad E. Meacham.

Justin Del Rio, 29, pleaded guilty in July to production of child pornography. He was sentenced Monday by U.S. District Judge James Wesley Hendrix.

Agents initiated the case in November 2020 after a Kik user calling himself “justback92” posted photographs of an underage female that appeared to have been taken with a hidden camera.  An undercover agent messaged the user, who said that the photographs were of a 12-year-old relative.

Agents traced the username back to Mr. Del Rio and executed a search warrant at his residence. Inside, they seized a smartphone that contained 51 photographs and 12 videos of child pornography. The majority of the images and videos depicted a 12-year-old or a two-year-old. One of the images depicted the two-year-old girl performing sex acts on the defendant.

In plea papers, Mr. Del Rio admitted that he enticed or coerced both children to engage in sexually explicit conduct for the purpose of producing a visual depiction.

“HSI special agents are committed to putting away those who prey on the innocent,” said acting HSI Dallas Special Agent in Charge Christopher Miller. “Working alongside our law enforcement partners, we will do everything possible to protect the innocence of children by stopping predators responsible for this horrific abuse and helping to ensure they are brought to justice.”

Homeland Security Investigation’s Dallas Field Office, San Angelo Division investigated the case with the assistance of Homeland Security Investigation’s Detroit Field Office. Assistant U.S. Attorney Juanita Fielden prosecuted the case with the help of Assistant U.S. Attorney Stephen Rancourt.

 

A Texas vape shop owner pleaded guilty Tuesday to a felony charge relating to the importation of counterfeit vaping products, the Department of Justice announced. Muhammad Uzair Khalid (Uzair), 36, of Garland, Texas, pleaded guilty in the U.S. District Court for the Northern District of Texas to one count of trafficking in counterfeit goods, in violation of 18 U.S.C. § 2320(a)(1). Uzair admitted that, from October 2017 to November 2019, he intentionally and unlawfully imported counterfeit vaping-related items from China, including counterfeit vaping atomizers, labels, boxes and bags for vaping-related products.

Since August 2019, the Centers for Disease Control and Prevention (CDC), the Food and Drug Administration (FDA), state and local health departments and other clinical and public health partners have been investigating a 2019 to 2020 national outbreak of E-cigarette or Vaping Product Use-Associated Lung Injury (EVALI) that involved more than 1,000 reports of lung injuries — including some resulting in deaths — following the use of vaping products. As the public health investigation has continued, authorities have warned that the injuries may be linked to the use of vaping products containing Vitamin E acetate, as well as tetrahydrocannabinol (THC).

During a November 2019 search of a Texas vape shop owned by Uzair, Homeland Security Investigations (HSI) special agents seized counterfeit vaping-related items, as well as a machine used to fill vape cartridges, several items that tested positive for THC and an injector mechanism with an amber substance containing Vitamin E acetate.

In pleading guilty, Uzair admitted that he regularly communicated with Chinese manufacturers about the production and sale of counterfeit vaping products. In particular, Uzair consulted with Chinese manufacturers on methods to imitate the branding and logos of well-known American vape companies and imported and sold imitation vaping devices, labels and packaging. Uzair further admitted that he adopted and used those counterfeit marks to boost his sales. Uzair also sold numerous other counterfeit goods at his vape shop.

“The Department of Justice takes counterfeiting seriously,” said Acting Assistant Attorney General Brian M. Boynton of the Justice Department’s Civil Division. “We will continue working with our law enforcement partners to take these products off the market.”

“Our investigation made clear that we needed to take swift action against counterfeit vaping-related items,” said U.S. Attorney Chad E. Meacham for the Northern District of Texas. “The Justice Department will not tolerate the importation of black-market goods.”

“HSI is committed to enforcing the nation’s intellectual property rights laws to help safeguard American consumers said Acting Special Agent in Charge Christopher Miller of HSI Dallas. “We strive to protect legitimate U.S. businesses from financial harm caused by criminal organizations that profit from trafficking in counterfeit goods, including counterfeit vaping products.”

U.S. Magistrate Judge Renee Harris Toliver took the defendant’s guilty plea in federal court in Dallas.

Assistant U.S. Attorney Phelesa M. Guy of the U.S. Attorney’s Office for the Northern District of Texas and Trial Attorneys Speare Hodges and Patrick Runkle of the Department of Justice Civil Division’s Consumer Protection Branch are prosecuting the case. This matter was primarily investigated by the U.S. Department of Homeland Security.

Two Nigerian fraudsters arrested in DOJ’s Operation reWired have been sentenced to a combined 22 ½ years in federal prison, announced acting U.S. Attorney Chad E. Meacham.

Opeyemi Abidemi Adeoso, 46, pleaded guilty in June of 2020 to 17 counts of wire fraud, eight counts of money laundering, six counts of use of a false passport, one count of conspiracy to commit wire fraud, and one count of conspiracy to commit money laundering. He was sentenced Thursday by Chief U.S. District Judge Barbara M.G. Lynn to 151 months in federal prison and ordered to pay $9.3 million in restitution.

His coconspirator, Benjamin Adeleke Ifebajo, 47, pleaded guilty in March 2020 to seven counts of wire fraud, six counts of money laundering, four counts of use of a false passport, one count of conspiracy to commit wire fraud, and one count of conspiracy to commit money laundering. He was sentenced in June to 120 months in federal prison and ordered to pay $2.1 million in restitution.

“These defendants utilized multiple tactics to deceive unsuspecting businesses out of their money. By assuming fictitious identities they defrauded dozens, which risks business health and in turn, erodes overall economic health,” said FBI Dallas Special Agent in Charge Matthew J. DeSarno. “Along with our federal law enforcement partners, we will continue to hold fraudsters accountable for their crimes and the harm they cause.”

Agents initiated an investigation into the pair in August 2018, after receiving a report of a business email compromise scheme from a victim who had transferred more than $504,000 into a bank account registered to a “Daniel Sammy Campbell.” Using the address associated with the account, they traced it back to Mr. Adeoso. Agents then reviewed bank surveillance footage and traced funds to identify Mr. Adeoso and Mr. Ifebajo, Nigerian nationals in the U.S. on non-immigrant vias.

According to court documents, the defendants admitted they used fraudulent passports to open individual bank accounts under assumed names. Other members of the conspiracy then sent phishing emails – which spoofed the email addresses of victims’ employers, supervisors, and other known business contacts – to numerous individuals prompting them to initiate wire transfers from their personal bank accounts or from their employer’s bank accounts.

Once the money hit the defendants’ accounts, they withdrew the money, often tens of thousands of dollars at a time, in cash, via cashiers’ checks, or through electronic transfer, then deposited the funds into other alias accounts. Occasionally, they made purchases with the money.

Mr. Adeoso is believed to have used aliases including, but not limited to: Peter Kuffor, George Macharty, Nelson Johnson, Braheem Larke, Michael Albert, Michael Jaden Sean, Michael Jeff Brown, and Benjamin Zee Brown. Mr. Ifebajo is believed to have used aliases including, but not limited to: Joseph Eric Johnson, Jeremiah Alex Malcom, Tidwell Anthony Wilson, and Andrew James Williams.

A third co-conspirator, Temitope Aminat Folorunsho, 35, pleaded guilty in July 2020 to multiple counts of wire fraud, money laundering, use of false passport, and conspiracy and was sentenced in July 2021 to 37 months in federal prison and ordered to pay roughly $221,000 in restitution. Ms. Folorunsho used aliases Terri L. Brown, Michelle Angel Cole, Robyn L. Granell, and Deborah Kiki Philip.

The Federal Bureau of Investigation’s Dallas Field Office, the U.S. Department of State’s Diplomatic Security Service (DSS), and Homeland Security Investigations’ Dallas Field Office conducted the investigation. Assistant U.S. Attorney Tiffany H. Eggers prosecuted the case.

A former church bookkeeper has been sentenced to five and a half years in federal prison for using church funds for personal enrichment, announced Acting U.S. Attorney for the Northern District of Texas Chad E. Meacham.

Lisa Dawn Stabeno, 52, pleaded guilty in May to two counts of bank fraud. She was sentenced Thursday by U.S. District Judge James Wesley Hendrix, who lamented her “brazen thefts” and ordered her to pay $450,000 in restitution.

According to court documents, Ms. Stabeno embezzled more than $450,000 from Church on the Rock, a non-denominational religious institution serving more than 3,400 parishioners in Lubbock.

In plea papers, Ms. Stabeno admitted that she began embezzling from the church in November 2013, just four months after assuming accounting responsibilities.

She began by using two credit cards – one assigned to a church employee and one assigned to a pastor – to pay personal expenses, including a car loan she co-financed with her daughter, medical and dental expenses, clothing, salon services, and restaurant meals.  She also used the credit cards to purchase supplies for a bakery she co-owned with her daughters.

Beginning in 2014, Ms. Stabeno began making payments to herself with church credit cards using Square, a digital point-of-sale payment system which processes payments from credit cards run through a port connected to a cell phone.

In 2015, Ms. Stabeno opened two credit cards, one in her own name and one in her daughter’s name, which she used for personal expenses. She then paid off hundreds of thousands of dollars in credit card debt on the cards using money from church bank accounts, including its general operating account, and its “Dream Center” ministry account.

She also used the personal credit cards to make “purchases” and payroll at her bakery, then paid off the cards with money from the church accounts, thus boosting the bakery’s sales and profits and raising her daughters’ salaries.  

The church discovered Ms. Stabeno’s fraud in the summer of 2018 and terminated her employment.

The Federal Bureau of Investigation’s Dallas Field Office, Lubbock Resident Agency, conducted the investigation. Assistant U.S. Attorney Ann Howey prosecuted the case.

A longtime drug dealer has been convicted of drug and gun crimes, announced Acting U.S. Attorney for the Northern District of Texas Chad E. Meacham.

Following a two-day trial, a federal jury convicted Jerome Thomas Watkins, 44, of conspiracy to possess with intent to distribute cocaine, fentanyl, methamphetamine, and heroin; possession with intent to distribute fentanyl; and possession of a firearm by a felon.

According to evidence presented at trial, officers executed a search warrant at Mr. Watkins’ residence on April 26. Inside, they found more than 4,000 pills laced with fentanyl, methamphetamine, and heroin, along with seven firearms and approximately $17,000 in cash.

They also seized roughly 20 phones, 11 of which were linked to the defendant and contained evidence of his extensive drug trafficking activities.

Mr. Watkins had previously been convicted of two drug crimes: in 1996, he pleaded guilty to possession of intent to distribute crack cocaine and was sentenced to 72 months in federal prison, and in 2002, he pleaded guilty of possession with intent to distribute cocaine and was sentenced to 135 months in federal prison.

While the jury convicted Mr. Watkins of three crimes on Tuesday, they acquitted him of a fourth crime, possession of a firearm in furtherance of a drug trafficking crime.

Mr. Watkins now faces 25 years to life in federal prison. His sentencing has been set for March 18.

The Drug Enforcement Administration’s Dallas Field Division, the Federal Bureau of Investigation’s Dallas Field Office, Fort Worth Resident Agency, and the Parker County Sheriff’s Office conducted the investigation with the assistance of the and the Bureau of Alcohol, Tobacco, Firearms & Explosives’ Dallas Field Division and the Benbrook Police Department. Assistant U.S. Attorneys Laura Montes and Shawn Smith prosecuted the case. U.S. District Judge Reed C. O’Connor presided over the trial.

A Mexican drug trafficker was sentenced today to 15 years in federal prison for drug crimes, announced Acting U.S. Attorney Chad E. Meacham.

Hector Burgos Saucedo, a 49-year-old citizen of Mexico in the U.S. unlawfully, pleaded guilty in  March to possession with intent to distribute methamphetamine. He was sentenced Friday by U.S. District Judge Sam A. Lindsay.

According to his plea papers, Mr. Saucedo admitted that in October 2020, he delivered 10 kilograms of methamphetamine, packed inside a brown U-Haul box, to an individual at a meat market on Spring Valley Road in Dallas.  He was arrested before he could collect his $65,000 fee.

Mr. Saucedo will face deportation proceedings after serving his sentence.

The Texas Department of Public Safety conducted the investigation with assistance from the Federal Bureau of Investigation’s Dallas Field Office. Assistant U.S. Attorney George Leal prosecuted the case.\

UPDATE: In an opinion handed down on Aug. 23, 2022, the Fifth Circuit Court of Appeals vacated the below conviction and remanded it for further proceedings.

A Dallas real estate developer was sentenced today to eight years in federal prison for bribing two former Dallas City Council members, Carolyn Davis and Dwaine Caraway, Acting U.S. Attorney for the Northern District of Texas Chad E. Meacham announced.

In June, a federal jury convicted Ruel Hamilton, the president of AmeriSouth Realty Group, of one count of conspiracy and two counts of bribery of an agent of a local government receiving federal funds. Mr. Hamilton was sentenced Tuesday by Chief U.S. District Judge Barbara M.G. Lynn, who also ordered him to pay a $150,000 fine.

“Even as he extoled his own generosity, Mr. Hamilton bought and paid for his influence at City Hall. He used money to ingratiate himself to lawmakers, subverting the democratic processes we hold dear,” said Acting U.S. Attorney Chad Meacham. “As my predecessors have said, the U.S. Attorney’s Office will not allow a kickback culture to fester at City Hall. Our prosecutors will not hesitate to pursue anyone involved in public corruption.”

“Today’s sentencing reaffirms the FBI’s commitment to holding those who pay bribes, accept bribes, and facilitate bribe payments fully accountable. Mr. Hamilton learned that there are consequences to circumventing a system that is in place to protect taxpayers,” said FBI Dallas Special Agent in Charge Matthew J. DeSarno. “Public corruption remains one of the FBI’s top criminal priorities and we will continue working with our law enforcement partners to pursue anyone involved in this type of scheme.”

According to evidence presented at trial, from 2013 to 2015, Mr. Hamilton shelled out tens of thousands of dollars in bribes to Carolyn Davis, who was then serving as chair of the city’s Housing Committee.

In return, Ms. Davis – who pleaded guilty to her role in the scheme prior to her death in 2019 – supported Mr. Hamilton’s Royal Crest housing project, voting to authorize a real estate development loan and resolutions supporting an award of a 9 percent tax credit for Royal Crest.  Ms. Davis supported the Royal Crest housing project, despite the fact that it failed to meet the city’s enumerated multifamily housing priorities.

In an attempt to disguise the bribe payments, Mr. Hamilton funneled payments to Ms. Davis through a not-for-profit intermediary run by Jeremy “Jay” Scroggins. Mr. Scroggins –  who also previously pleaded guilty – testified at trial that he cashed thousands of dollars’ worth of checks, solicited by Ms. Davis and made out to him personally or to his not-for-profit, “Hip Hop Government.  Mr. Scroggins testified that he used $15,000 for a Freedom Ride Tour in November 2014, and cashed the remainder of the checks, turning most of the money over to Ms. Davis.  The councilwoman told Mr. Scroggins payments would not pose a problem, because people “don’t go to prison for $2,000,” according to a recorded phone call played in court.

Evidence showed that Mr. Hamilton also paid Ms. Davis directly. Over the course of the conspiracy, Mr. Hamilton forked over cash, and on at least one occasion he invited her to accompany him to the bank to make a cash withdrawal. At Ms. Davis’ urging, Mr. Hamilton also directed campaign contributions to a political protégé.  Further, Mr. Hamilton promised Ms. Davis a job once she was off the counsel.  Evidence showed that Mr. Hamilton paid Ms. Davis in excess of $145,000, once she left the council.

At one point, Mr. Hamilton became concerned that a former city council member was going through their financial dealings with a “fine tooth comb,” telling Ms. Davis, “she scares me.” Even so, he continued to bribe Ms. Davis.

Three years later, in 2018, Mr. Hamilton paid a $7,000 bribe to councilman Dwaine Caraway, who Mr. Hamilton believed could persuade the mayor to put a paid sick leave referendum on the city council’s agenda.  Mr. Hamilton hoped the referendum would increase turnout in the polls, advantaging his preferred political candidates.

Video admitted into evidence at trial shows the pair meeting at Mr. Caraway’s office on August 3, 2018:

“I want to do that, so… what can I do for you, right now, today?” Mr. Hamilton asks.

“You can answer that bill I just threw out there for about 62 [$6,200] today,” Mr. Caraway responds. 

“Okay,” Mr. Hamilton says. “Can you follow through with the mayor?”

The pair then discuss what Mr. Hamilton should put in the memo line “for posterity” so that “if somebody ever asks, I can come up with a reference.”

The defendant was instructed to report to the Bureau of Prisons in February.

The Federal Bureau of Investigation’s Dallas Field Office conducted the investigation with the assistance of Internal Revenue Service - Criminal Investigations. Assistant U.S. Attorneys Tiffany H. Eggers, Joe A. Magliolo, Andrew Wirmani (fmr.), and Marcus Busch prosecuted the case with support from their appellate liaison, Assistant U.S. Attorney Stephen S. Gilstrap.

The Justice Department announced today recent actions taken against two foreign nationals charged with deploying Sodinokibi/REvil ransomware to attack businesses and government entities in the United States, amnounced Attorney General Merrick Garland, Deputy Attorney General Lisa Monaco, and Acting U.S. Attorney Chad E. Meacham.

An indictment unsealed today charges Yaroslav Vasinskyi, 22, a Ukrainian national, with conducting ransomware attacks against multiple victims, including the July 2021 attack against Kaseya, a multi-national information technology software company.

The department also announced today the seizure of $6.1 million in funds traceable to alleged ransom payments received by Yevgeniy Polyanin, 28, a Russian national, who is also charged with conducting Sodinokibi/REvil ransomware attacks against multiple victims, including businesses and government entities in Texas on or about Aug. 16, 2019.

According to the indictments, Vasinskyi and Polyanin accessed the internal computer networks of several victim companies and deployed Sodinokibi/REvil ransomware to encrypt the data on the computers of victim companies.

“Cybercrime is a serious threat to our country: to our personal safety, to the health of our economy, and to our national security,” said Attorney General Garland. “Our message today is clear. The United States, together with our allies, will do everything in our power to identify the perpetrators of ransomware attacks, to bring them to justice, and to recover the funds they have stolen from their victims.”

“Our message to ransomware criminals is clear: If you target victims here, we will target you,” said Deputy Attorney General Monaco. “The Sodinokibi/REvil ransomware group attacks companies and critical infrastructures around the world, and today’s announcements showed how we will fight back.  In another success for the department’s recently launched Ransomware and Digital Extortion Task Force, criminals now know we will take away your profits, your ability to travel, and – ultimately – your freedom. Together with our partners at home and abroad, the Department will continue to dismantle ransomware groups and disrupt the cybercriminal ecosystem that allows ransomware to exist and to threaten all of us.”

“Ransomware can cripple a business in a matter of minutes. These two defendants deployed some of the internet’s most virulent code, authored by REvil, to hijack victim computers,” said Acting U.S. Attorney Chad E. Meacham for the Northern District of Texas. “In a matter of months, the Justice Department identified the perpetrators, effected an arrest, and seized a significant sum of money. The Department will delve into the darkest corners of the internet and the furthest reaches of the globe to track down cyber criminals.”

“The arrest of Yaroslav Vasinskyi, the charges against Yevgeniy Polyanin and seizure of $6.1 million of his assets, and the arrests of two other Sodinokibi/REvil actors in Romania are the culmination of close collaboration with our international, U.S. government and especially our private sector partners,” said FBI Director Christopher Wray. “The FBI has worked creatively and relentlessly to counter the criminal hackers behind Sodinokibi/REvil. Ransomware groups like them pose a serious, unacceptable threat to our safety and our economic well-being. We will continue to broadly target their actors and facilitators, their infrastructure, and their money, wherever in the world those might be.”

According to court documents, Vasinskyi was allegedly responsible for the July 2 ransomware attack against Kaseya. In the alleged attack against Kaseya, Vasinskyi caused the deployment of malicious Sodinokibi/REvil code throughout a Kaseya product that caused the Kaseya production functionality to deploy REvil ransomware to “endpoints” on Kaseya customer networks. After the remote access to Kaseya endpoints was established, the ransomware was executed on those computers, which resulted in the encryption of data on computers of organizations around the world that used Kaseya software.

Through the deployment of Sodinokibi/REvil ransomware, the defendants allegedly left electronic notes in the form of a text file on the victims’ computers. The notes included a web address leading to an open-source privacy network known as Tor, as well as the link to a publicly accessible website address the victims could visit to recover their files. Upon visiting either website, victims were given a ransom demand and provided a virtual currency address to use to pay the ransom. If a victim paid the ransom amount, the defendants provided the decryption key, and the victims then were able to access their files. If a victim did not pay the ransom, the defendants typically posted the victims’ stolen data or claimed they sold the stolen data to third parties, and victims were unable to access their files. 

Vasinskyi and Polyanin are charged in separate indictments with conspiracy to commit fraud and related activity in connection with computers, substantive counts of damage to protected computers, and conspiracy to commit money laundering. If convicted of all counts, each faces a maximum penalty of 115 and 145 years in prison, respectively.

The $6.1 million seized from Polyanin is alleged to be traceable to ransomware attacks and money laundering committed by Polyanin through his use of Sodinokibi/REvil ransomware. The seizure warrant was issued out of the Northern District of Texas. Polyanin is believed to be abroad.

On Oct. 8, Vasinskyi was taken into custody in Poland where he remains held by authorities pending proceedings in connection with his requested extradition to the United States, pursuant to the extradition treaty between the United States and the Republic of Poland. In parallel with the arrest, interviews and searches were carried out in multiple countries, and would not have been possible without the rapid response of the National Police of Ukraine and the Prosecutor General’s Office of Ukraine.

An indictment is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

The FBI’s Dallas and Jackson Field Offices are leading the investigation. Substantial assistance was provided by the Justice Department’s Office of International Affairs and the National Security Division’s Counterintelligence and Export Control Section.

Assistant U.S. Attorney Tiffany H. Eggers of the U.S. Attorney’s Office for the Northern District of Texas and Senior Counsel Byron M. Jones from the Justice Department’s Computer Crime and Intellectual Property Section are prosecuting the case.

The U.S. Attorney’s Office for the Northern District of Texas, the FBI’s Dallas and Jackson Field Offices, and the Criminal Division’s Computer Crime and Intellectual Property Section conducted the operation in close cooperation with Europol and Eurojust, who were an integral part of coordination. Investigators and prosecutors from several jurisdictions, including: Romania's National Police and the Directorate for Investigating Organised Crime and Terrorism; Canada’s Royal Canadian Mounted Police; France’s Court of Paris and BL2C (anti-cybercrime unit police); Dutch National Police; Poland’s National Prosecutor’s Office, Border Guard, Internal Security Agency, and Ministry of Justice; and the governments of Norway and Australia provided valuable assistance.

The U.S. Department of the Treasury Financial Crimes Enforcement Network (FinCEN), Department of Homeland Security's Cybersecurity and Infrastructure Security Agency (CISA), Germany’s Public Prosecutor’s Office Stuttgart and State Office of Criminal Investigation of Baden-Wuerttemberg; Switzerland’s Public Prosecutor’s Office II of the Canton of Zürich and Cantonal Police Zürich; United Kingdom’s National Crime Agency; U.S. Secret Service; Texas Department of Information Resources; BitDefender; McAfee; and Microsoft also provided significant assistance.

This case is part of the Department of Justice’s Ransomware and Digital Extortion Task Force, which was created to combat the growing number of ransomware and digital extortion attacks. As part of the task force, the Criminal Division, working with the U.S. Attorneys’ Offices, prioritizes the disruption, investigation, and prosecution of ransomware and digital extortion activity by tracking and dismantling the development and deployment of malware, identifying the cybercriminals responsible, and holding those individuals accountable for their crimes. The department, through the task force, also strategically targets the ransomware criminal ecosystem as a whole and collaborates with domestic and foreign government agencies as well as private sector partners to combat this significant criminal threat.

For more information about the Ransomware and Digital Extortion Task Force, read the Deputy Attorney General’s recent guidance memo on related investigations and cases. For more resources on ransomware prevention and response, visit StopRansomware.gov.

 

The Justice Department announced today recent actions taken against two foreign nationals charged with deploying Sodinokibi/REvil ransomware to attack businesses and government entities in the United States.

An indictment unsealed today charges Yaroslav Vasinskyi, 22, a Ukrainian national, with conducting ransomware attacks against multiple victims, including the July 2021 attack against Kaseya, a multi-national information technology software company.

The department also announced today the seizure of $6.1 million in funds traceable to alleged ransom payments received by Yevgeniy Polyanin, 28, a Russian national, who is also charged with conducting Sodinokibi/REvil ransomware attacks against multiple victims, including businesses and government entities in Texas on or about Aug. 16, 2019.

According to the indictments, Vasinskyi and Polyanin accessed the internal computer networks of several victim companies and deployed Sodinokibi/REvil ransomware to encrypt the data on the computers of victim companies.

“Cybercrime is a serious threat to our country: to our personal safety, to the health of our economy, and to our national security,” said Attorney General Garland. “Our message today is clear. The United States, together with our allies, will do everything in our power to identify the perpetrators of ransomware attacks, to bring them to justice, and to recover the funds they have stolen from their victims.”

“Our message to ransomware criminals is clear: If you target victims here, we will target you,” said Deputy Attorney General Monaco. “The Sodinokibi/REvil ransomware group attacks companies and critical infrastructures around the world, and today’s announcements showed how we will fight back.  In another success for the department’s recently launched Ransomware and Digital Extortion Task Force, criminals now know we will take away your profits, your ability to travel, and – ultimately – your freedom. Together with our partners at home and abroad, the Department will continue to dismantle ransomware groups and disrupt the cybercriminal ecosystem that allows ransomware to exist and to threaten all of us.”

“The arrest of Yaroslav Vasinskyi, the charges against Yevgeniy Polyanin and seizure of $6.1 million of his assets, and the arrests of two other Sodinokibi/REvil actors in Romania are the culmination of close collaboration with our international, U.S. government and especially our private sector partners,” said FBI Director Christopher Wray. “The FBI has worked creatively and relentlessly to counter the criminal hackers behind Sodinokibi/REvil. Ransomware groups like them pose a serious, unacceptable threat to our safety and our economic well-being. We will continue to broadly target their actors and facilitators, their infrastructure, and their money, wherever in the world those might be.”

“Ransomware can cripple a business in a matter of minutes. These two defendants deployed some of the internet’s most virulent code, authored by REvil, to hijack victim computers,” said Acting U.S. Attorney Chad E. Meacham for the Northern District of Texas. “In a matter of months, the Justice Department identified the perpetrators, effected an arrest, and seized a significant sum of money. The Department will delve into the darkest corners of the internet and the furthest reaches of the globe to track down cyber criminals.”

According to court documents, Vasinskyi was allegedly responsible for the July 2 ransomware attack against Kaseya. In the alleged attack against Kaseya, Vasinskyi caused the deployment of malicious Sodinokibi/REvil code throughout a Kaseya product that caused the Kaseya production functionality to deploy REvil ransomware to “endpoints” on Kaseya customer networks. After the remote access to Kaseya endpoints was established, the ransomware was executed on those computers, which resulted in the encryption of data on computers of organizations around the world that used Kaseya software.

Through the deployment of Sodinokibi/REvil ransomware, the defendants allegedly left electronic notes in the form of a text file on the victims’ computers. The notes included a web address leading to an open-source privacy network known as Tor, as well as the link to a publicly accessible website address the victims could visit to recover their files. Upon visiting either website, victims were given a ransom demand and provided a virtual currency address to use to pay the ransom. If a victim paid the ransom amount, the defendants provided the decryption key, and the victims then were able to access their files. If a victim did not pay the ransom, the defendants typically posted the victims’ stolen data or claimed they sold the stolen data to third parties, and victims were unable to access their files. 

Vasinskyi and Polyanin are charged in separate indictments with conspiracy to commit fraud and related activity in connection with computers, substantive counts of damage to protected computers, and conspiracy to commit money laundering. If convicted of all counts, each faces a maximum penalty of 115 and 145 years in prison, respectively.

The $6.1 million seized from Polyanin is alleged to be traceable to ransomware attacks and money laundering committed by Polyanin through his use of Sodinokibi/REvil ransomware. The seizure warrant was issued out of the Northern District of Texas. Polyanin is believed to be abroad.

On Oct. 8, Vasinskyi was taken into custody in Poland where he remains held by authorities pending proceedings in connection with his requested extradition to the United States, pursuant to the extradition treaty between the United States and the Republic of Poland. In parallel with the arrest, interviews and searches were carried out in multiple countries, and would not have been possible without the rapid response of the National Police of Ukraine and the Prosecutor General’s Office of Ukraine.

The FBI’s Dallas and Jackson Field Offices are leading the investigation. Substantial assistance was provided by the Justice Department’s Office of International Affairs and the National Security Division’s Counterintelligence and Export Control Section.

Assistant U.S. Attorney Tiffany H. Eggers of the U.S. Attorney’s Office for the Northern District of Texas and Senior Counsel Byron M. Jones from the Justice Department’s Computer Crime and Intellectual Property Section are prosecuting the case.

The U.S. Attorney’s Office for the Northern District of Texas, the FBI’s Dallas and Jackson Field Offices, and the Criminal Division’s Computer Crime and Intellectual Property Section conducted the operation in close cooperation with Europol and Eurojust, who were an integral part of coordination. Investigators and prosecutors from several jurisdictions, including: Romania's National Police and the Directorate for Investigating Organised Crime and Terrorism; Canada’s Royal Canadian Mounted Police; France’s Court of Paris and BL2C (anti-cybercrime unit police); Dutch National Police; Poland’s National Prosecutor’s Office, Border Guard, Internal Security Agency, and Ministry of Justice; and the governments of Norway and Australia provided valuable assistance.

The U.S. Department of the Treasury Financial Crimes Enforcement Network (FinCEN), Department of Homeland Security's Cybersecurity and Infrastructure Security Agency (CISA), Germany’s Public Prosecutor’s Office Stuttgart and State Office of Criminal Investigation of Baden-Wuerttemberg; Switzerland’s Public Prosecutor’s Office II of the Canton of Zürich and Cantonal Police Zürich; United Kingdom’s National Crime Agency; U.S. Secret Service; Texas Department of Information Resources; BitDefender; McAfee; and Microsoft also provided significant assistance.

This case is part of the Department of Justice’s Ransomware and Digital Extortion Task Force, which was created to combat the growing number of ransomware and digital extortion attacks. As part of the task force, the Criminal Division, working with the U.S. Attorneys’ Offices, prioritizes the disruption, investigation, and prosecution of ransomware and digital extortion activity by tracking and dismantling the development and deployment of malware, identifying the cybercriminals responsible, and holding those individuals accountable for their crimes. The department, through the task force, also strategically targets the ransomware criminal ecosystem as a whole and collaborates with domestic and foreign government agencies as well as private sector partners to combat this significant criminal threat.

For more information about the Ransomware and Digital Extortion Task Force, read the Deputy Attorney General’s recent guidance memo on related investigations and cases. For more resources on ransomware prevention and response, visit StopRansomware.gov.

An indictment is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

A DFW nightclub magnate and two of his managers have been convicted of operating an empire of clubs in which drugs were sold openly, announced Acting U.S. Attorney for the Northern District of Texas Chad E. Meacham. 

Following six weeks of trial and four days of deliberation, a federal jury on Friday found OK Corral/ Far West owner Alfredo Hinojosa, general manager Miguel Casas, and noted promoter Martin Salvador Rodriguez guilty of managing drug premises, conspiracy to manage drug premises, and conspiracy to possess with intent to distribute cocaine. The jury also convicted a lower-level bathroom dealer, Cesar Mendez, of possession with intent to distribute and conspiracy to possess with intent to distribute.

The overall case included more than 30 defendants, all of whom have been convicted, including former Dallas Police Officers Eddie Villarreal and Craig Woods.

According to evidence presented at trial, Mr. Hinojosa, Mr. Casas, and Mr. Rodriguez ran a conglomeration of businesses that brought in revenue of more than $107 million over a four-year period.  

The defendants allowed cocaine to be sold in the bathrooms of their nightclubs on a daily basis, because such drug sales attracted customers and provided them with a competitive edge over rival clubs.  These drugs sales increased revenue at the clubs between $9 million and $12 million.

“These defendants made millions by explicitly allowing cocaine trafficking in nightclubs across DFW. They assumed that permitting bathroom drug deals would be their ‘competitive edge.’ Instead, it was their downfall,” said Acting U.S. Attorney Chad Meacham. “The United States Attorney’s Office and the FBI will not permit nightclub owners – or anyone else – to willfully turn a blind eye to drug trafficking happening on their premises.” 

“This conspiracy was designed to elevate the status of the defendants at a very high cost to our society,” said FBI Dallas Special Agent in Charge Matthew J. DeSarno. “Their extensive plans to conceal nightly high-volume drug sales included the recruitment of law enforcement officers as employees. We will continue to work with our local, state, and federal partners to protect the integrity of the profession, uphold the public’s trust, and prevent access to illicit drugs in our greater Dallas-Fort Worth communities.”

At trial, prosecutors presented evidence of 17 controlled drug buys that occurred at the OK Corral Dallas, OK Corral Fort Worth, and Far West nightclubs between 2013 and 2016. Half a dozen informants, all under the supervision of FBI agents, bought bag after bag of cocaine from traffickers operating out of club bathrooms.

Multiple security guards who worked inside the clubs testified at trial that Mr. Hinojosa, Mr. Casas, and Mr. Rodriguez knew the drug trafficking was occurring and openly ordered security personnel to allow it.  Drug traffickers, previously charged and convicted in the case, also testified that they were allowed to operate freely.

At trial, FBI agents explained that in 2015, they installed court-ordered microphones and a camera in Mr. Hinojosa’s office, unbeknownst to the defendants.  Agent also sought and obtained more a dozen wiretaps in the case.  During these recorded calls and intercepted communications, Mr. Hinojosa could be heard saying, “we can’t really clean it because then we lose business,” and “we need cocaine, man.”

Mr. Hinojosa, Mr. Casas, and Mr. Rodriguez eventually confessed to knowing that the drug sales were ongoing and allowed.  Prosecutors played Mr. Hinojosa’s 45-minute recorded interview for the jury.  Other agents recounted statements made by Mr. Casas and Mr. Rodriguez. 

According to one agent’s notes, Mr. Casas told a task force officer that when club management realized the business was “tanking,” they told bouncers to allow the drug sales to resume and leave drug dealers alone as long as they were “discreet.”

Mr. Hinojosa, Mr. Casas, and Mr. Rodriguez now face a mandatory minimum sentence of 10 years and up to life in in federal prison.  Mr. Mendez also faces 10 year mandatory minimum. Sentencing dates have not been set yet.

The Federal Bureau of Investigation’s Dallas Field Office and the Dallas Police Department conducted the investigation, which was dubbed “Operation Closing Time.” The Texas Alcoholic Beverage Commission's Enforcement Division provided valuable assistance. Assistant U.S. Attorneys P.J. Meitl, Nicole Dana, and Melanie Smith prosecuted the case. U.S. District Judge Sam A. Lindsay presided over trial.

A tax return preparer who filed fraudulent client tax returns was sentenced yesterday to almost two years in federal prison, announced Acting U.S. Attorney for the Northern District of Texas Chad E. Meacham.

Carlos Hinojosa, 37, Mario Jose Sanchez, 48, and Magda Lopez-Sanchez, 51, pleaded guilty this summer to assisting in the preparation of false and fraudulent tax returns. Mr. Hinojosa was sentenced Wednesday by U.S. District Judge Ed Kinkeade to 22 months in federal prison.  Mr. Sanchez and Ms. Lopez-Sanchez were each sentenced to three years’ probation. Judge Kinkeade ordered each of the defendants to pay more than $6 million in restitution, joint and severally, to the IRS.

From 2012 through 2016, Mr. Hinojosa, Mr. Sanchez, and Ms. Lopez-Sanchez worked as tax return preparers at Miguelitos Tax Service, a tax preparation service located in Carrolton, Texas.

According to plea papers, while at Miguelitos, the defendants prepared tax returns that included, among other false statements, false tuition expenses to make the clients appear eligible for education credits that they knew the clients were not eligible to receive. Mr. Hinojosa admitted that he generally included these false expenses on his clients' tax returns without the clients’ knowledge.

To conceal the falsity of the returns, the defendants attempted to have clients sign forms justifying the expenses. Mr. Hinojosa admitted he did not explain the forms to clients and most had no idea what they were signing. He further admitted that he charged clients cash for preparing their returns – sometimes as much as $2,000 – without informing them that Miguelitos would also deduct a tax preparation fee from their tax refunds.

Mr. Hinojosa, Mr. Sanchez, and Ms. Lopez-Sanchez agreed their actions, along with the conduct of coconspirators at Miguelitos, resulted in a tax loss to the Internal Revenue Service of $7,306,191 for tax years 2010 through 2016.

IRS Criminal Investigation conducted the investigation. Assistant U.S. Attorneys Douglas Brasher and Andrew Wirmani (fmr.) prosecuted the case.

The president of a motorcycle club involved in a shootout at a Lubbock bar was sentenced today to seven years in federal prison for a firearm offense, announced Acting U.S. Attorney Chad E. Meacham.

Danny Lee Gollihugh, the 42-year-old president of the local chapter of the Kinfolk Outlaw Motorcycle Club, pleaded guilty in July to possession of an unregistered firearm. He was sentenced Thursday by U.S. District Judge James Wesley Hendrix.

In plea papers, Mr. Gollihugh admitted that he built a short-barrel rifle using an Aero Precision lower receiver, a Magpul carbine stock, and the “shortest barrel that Sharp Shooters had.” A records check revealed that the weapon was not registered to Mr. Gollihugh in the National Firearms and Transfer Records, which is required by the National Firearms Act.

At his sentencing hearing, prosecutors introduced evidence that proved Mr. Gollihugh was involved in a shootout against members of the Bandidos Outlaw Motorcycle Club at the 50th Street Caboose restaurant and bar in Lubbock on November 12, 2020.

Surveillance video admitted into evidence during the hearing shows several members of the Bandidos approaching the defendant and his associates at a pool table. Mr. Gollihugh, clad in a leather vest and backwards baseball cap, then whipped out a pistol and pulled the slide back, while another Kinfolk Outlaw member fired a round in the Bandidos direction. The defendant later admitted that he’d attempted to fire the handgun, but it jammed.

Agents discovered the unregistered short-barrel rifle, along with the pistol used in the shooting, during Mr. Gollihugh’s arrest two days later. He is currently facing pending state charges for engaging in organized criminal activity.

The Bureau of Alcohol, Tobacco, Firearms & Explosives’ Dallas Field Division, Lubbock Resident Agency, the Lubbock Police Department, and the United States Marshals Service conducted the investigation. Assistant U.S Attorneys Ryan Redd and Matt McLeod prosecuted the case.

A Garland man has been sentenced to 13 years in federal prison for his role in a so-called “mystery shopper” mail fraud, announced Acting U.S. Attorney for the Northern District of Texas Chad E. Meacham.

John Lewis Davis, II, 45, of Garland, pleaded guilty in April to one count of conspiracy to commit mail fraud and two counts of mail fraud. He was sentenced Monday by U.S. District Judge Sam A. Lindsay.

According to court documents, between August 2014 and January 2018, the defendant conspired with others to send counterfeit U.S. Postal money orders and checks to unwitting individuals, who would then cash the money orders at banks and other financial institutions and send a portion of the money back to the defendant and his co-conspirators.

As part of the fraud, the defendant and his co-conspirators caused two packages from Nigeria to be sent to the defendant. Both packages were intercepted by law enforcement prior to reaching the recipients.  Upon opening the packages, law enforcement found approximately 3,400 counterfeit money orders between the two parcels. 

Trial Attorney Matthew P. Mattis of the Justice Department’s Organized Crime and Gang Section and Assistant U.S. Attorneys Nick Bunch (fmr.) and Katherine Miller of the Northern District of Texas prosecuted the case.

Two Lubbock postal contractors have been charged with possession of stolen mail, announced Acting U.S. Attorney Chad E. Meacham.

The investigation – which culminated in the recovery of more than 8,000 pieces of mail worth more than $4 million – marks the largest ever seizure of stolen mail in Northern District of Texas history.

Joe Roy Rivas, III, 22, and Jessica Lynn Solomon, 35, were indicted on Oct. 13 on one count of conspiracy to possess stolen mail and eight counts of possession of stolen mail. Ms. Solomon was arrested in Slaton, Texas the following day and made her initial appearance in federal court on Oct. 15; Mr. Rivas was arrested in Slaton on Oct. 27 and made his initial appearance in federal court yesterday afternoon.

According to the indictment, Mr. Rivas and Ms. Solomon were former co-workers at Cargo Force, Inc., a company that contracts with the United States Postal Service to load mail into and out of air containers destined for flights to and from the Lubbock International Airport.

During their shifts, the defendants allegedly sifted through mail looking for items containing cash, gift cards, checks, and money orders. They allegedly stole that mail and stashed it in 55-gallon trash bags at their residences. Among the checks they stole were a $25,728 check made payable to a telecom co-op, a $15,000 check to a consulting group, and a $241,1863 check to a facilities management and food services company.

An indictment is merely an allegation of criminal conduct, not evidence.  Like all defendants, Mr. Rivas and Ms. Solomon are presumed innocent until proven guilty in a court of law.

If convicted on all counts, they face up to 45 years in prison.

The U.S. Postal Inspection Service and Slaton Police Department conducted the investigation. Assistant U.S. Attorney Ann Howey is prosecuting the case.

An Amarillo man who said he gave guns to children has been sentenced to 10 years in federal prison for a firearm crime, announced Acting U.S. Attorney Chad E. Meacham.

Roaryrious “Buddy” Perkins, 31, was convicted in June of being a felon in possession of a firearm. He was sentenced Thursday by U.S. District Judge Matthew J. Kacsmaryk.

According to court documents, in September 2018, law enforcement officers found a Smith & Wesson .45 caliber handgun in the wall of a hotel room occupied by Mr. Perkins and two associates. A National Integrated Ballistic Information Network (NIBIN) examination of the gun revealed that it had been used in four different drive-by shootings in Amarillo. A lab test of the weapon indicated a 1 in 1.2 trillion chance that one of the four DNA profiles found on the gun belonged to Mr. Perkins.

Four months later, in January 2019, law enforcement arrested Mr. Perkins at the scene of a trespass in progress. Inside the home, they found a  Springfield 9mm pistol. During a subsequent interview with police, Mr. Perkins admitted that he’d purchased the Springfield pistol, claiming he’d had a “white dude” buy the gun for him in order to give it to his girlfriend for protection.

Mr. Perkins – who was previously convicted of robbery and possession of a controlled substance – admitted that he handled the pistol in spite of federal laws that prohibit convicted felons to possess firearms.  

At his sentencing hearing, prosecutors read from a statement Mr. Perkins made to law enforcement in September 2018, in which he claimed he provided firearms and money to “young kids” to commit shootings on his behalf. He even admitted he offered the children money to shoot at a particular individual.

“They got no momma, no house, no money.  You give them a $1,000 and a gun – what do you think they are going to do?” Mr. Perkins told law enforcement.

It is unclear what, if anything, the minors did with the weapons Mr. Perkins said he provided to them.

The Federal Bureau of Investigations’ Dallas Field Office, the United States Marshal Service, and the Amarillo Police Department conducted the investigation with the assistance of the Bureau of Alcohol, Tobacco, Firearms & Explosives. Assistant U.S. Attorney Anna Marie Bell prosecuted the case.

A Lubbock sex offender has been sentenced to life in federal prison for abusing a 15-year-old girl, announced Acting U.S. Attorney for the Northern District of Texas Chad E. Meacham.

Jason Lee Guthrey, who was already a registered sex offender at the time of the crime, pleaded guilty in June to enticement of a minor. He was sentenced Thursday by U.S. District Judge James Wesley Hendrix.

“Today’s life sentence is a commitment from law enforcement that we will not allow the defendant to intimidate, coerce or assault a child again,” said Dallas FBI Special Agent in Charge Matthew J. DeSarno. “I am grateful for the work of the investigative team on this specific case, and their continued pursuit for justice as they work to protect the most vulnerable members of our community.”

According to plea papers, a truck driver discovered the young girl sitting on the side of the road in freezing weather on Nov. 30, 2020. Jane Doe later told law enforcement she’d left her home to get away from Mr. Guthrey, who was dating one of her relatives and who had sexually assaulted her in her sleep on several occasions.

In text messages, Mr. Guthrey, then 44, pleaded with the girl not to reveal the abuse:

“l'm am [sic] truly sorry for that I don't want you to be mad at me,” he wrote in a series of texts in early November. “Please keep this between you and me please.”

“I’m sorry about the things that I have wanted to do with you but I will never do anything that will hurt you. I am sure that I can be a great guy,” he continued a few weeks later. "And please keep this between us.”

At his sentencing hearing, prosecutors argued that Mr. Guthrey was a dangerous child predator who refused to take responsibility for his actions. In fact,  as an attempt to excuse his behavior at the hearing, Mr. Guthrey claimed he was “still friends” with a prior minor victim of his, and further claimed his advances on the current victim were simply the result of drug use. 

The Federal Bureau of Investigation’s Dallas Field Office, Lubbock Resident Agency and the Lubbock Police Department conducted the investigation. Assistant U.S. Attorney Callie Woolam prosecuted the case.

A Nocona man named a person of interest in the 2015 disappearance of a local 18-year-old was sentenced today to 30 years in federal prison for preying on the boy when he was a minor, announced Acting U.S. Attorney for the Northern District of Texas Chad E. Meacham.

In July, just hours after the court declared a mistrial due to juror injury, Ricky Dale Howard, 59, pleaded guilty to sexual exploitation of a child. He was sentenced Wednesday by U.S. District Judge Reed C. O’Connor.

“The vast majority of sexually exploited children were victimized by an adult they know and trust – and the young man in this case was no different. While we may never know what happened to him in the moments before his disappearance, we know he spent many months enduring the unthinkable,” said Acting U.S. Attorney Chad Meacham.  “We continue to pray that one day, he will be found. In the meantime, we hope today’s sentence brings a measure of solace to the family and friends who loved him. We are proud to put this sexual predator behind bars.”

“Mr. Howard exploited his position of trust with the victim’s family and will now be held accountable for his actions,” said Dallas FBI Special Agent in Charge Matthew J. DeSarno. “We will continue to use our combined law enforcement resources to seek justice for victims, their families and other vulnerable members of our community.”

According to evidence presented in court before the mistrial was declared, law enforcement obtained several of Mr. Howard’s computers during an investigation into the disappearance of a high school senior who was reported missing on April 1, 2015, just two weeks after his 18th birthday. 

On the computers, investigators found sexually explicit images that appeared to show Mr. Howard sexually abusing the missing boy. In pleading guilty, Mr. Howard admitted that he enticed the minor into engaging in sexually explicit conduct for the purpose of creating a visual depiction.

At trial, the boy’s mother testified she and her children had been close with the Howard family since the boys were children. Tami Diehl said her son began performing odd jobs for Mr. Howard during middle school.

Law enforcement officers testified that following the boy’s disappearance, Mr. Howard told police the last time he’d seen the victim was the weekend before he went missing, when the pair attempted to repair his broken-down truck.  Several days into the missing person investigation, an officer observed a burn pit with several incinerated computers on Mr. Howard’s property.

Two years after the disappearance, Ms. Diehl discovered a small handheld tape recorder hidden in the back of a bathroom cabinet. The tape recorder contained audio of Mr. Howard asking himself polygraph questions pertaining to his sexual interest in young boys.

Shortly thereafter, investigators re-examined the missing persons case. Recalling the incinerated computers, officers asked Mr. Howard’s ex-wife and later his daughter for the computers, which were examined by analysts at the FBI’s North Texas Regional Computer Forensic Lab. Ms. Diehl, one of Mr. Howard’s sons, and Mr. Howard’s ex-wife all identified the missing victim in redacted versions of photographs extracted from the computers.

“My family is broken, I know we will never have a gathering where there isn't a sense of wrongness and of a huge, important part being missing,” Ms. Diehl testified at Mr. Howard’s sentencing hearing. “It has now been almost seven years since [my son] disappeared. Years of searching, waiting, and praying for answers to get to this day – and still to not truly have the answer our hearts require. But I am so thankful to the investigators and prosecutors for not giving up and at least making sure that Ricky Howard can hurt no one else.”

The Federal Bureau of Investigation’s Dallas Field Office, Wichita Falls Resident Agency, the Montague County Sheriff’s Office, and the Nocona Police Department conducted the investigation with the assistance of the Montague County District Attorney’s Office and the Texas Rangers. Assistant U.S. Attorneys Brandie Wade and Nancy Larson prosecuted the case.