Northern District of Texas

PLEA – Isaiah Alexander Allen
On Jan. 2, 22-year-old Isaiah Alexander Allen pleaded guilty to cyberstalking, after law enforcement caught him posting so-called “revenge porn.” Allen met his victim, a California college student, on an internet gaming website. Over the course of their online relationship, she sent him several sexual photos. But when she refused to provide additional lascivious images, Allen posted dozens of her naked photos online, along with screenshots of B.K.’s driver’s license, college ID, and social security card, as well as her phone number and physical address. The photos, originally uploaded to Reddit and Imgur and later shared on sites like 4Chan and PornStarTube, have been viewed more than a million times. The FBI and Lubbock Police Department investigated.

INDICTMENT*  – Daniel Jenkins & Michael Atkinson
On Jan. 8, two Dallas men were charged with conspiracy to commit hate crimes, kidnapping, and carjacking. Daniel Jenkins, 19, and Michael Atkinson, 24, allegedly used fake profiles targeting gay men on Grindr, a GTBQ dating app, to lure at least nine men, ages 19 to 57, to an apartment complex, where they were assaulted, taunted, and robbed. At least five victims were physicaly assaulted, one was sexually assaulted with an object, and one was smeared with feces. The FBI investigated.  

VERDICT -- Robert Bazan
On Jan. 8, a federal jury found Robert Bazan, 45, of Seminole, Texas, guilty of methamphetamine and firearms offenses.  According to the evidence presented at trial, in April 2018, Mr. Bazan sold an AR-style pistol and approximately one ounce of methamphetamine to a confidential informant.  Less than four months later, Mr. Bazan led deputies with Gaines County, Texas, and Lea County, New Mexico, on a high-speed pursuit following a traffic stop.  During the pursuit, which reached speeds over 95 miles per hour, Bazan attempted to discard two handguns and approximately 413 grams of methamphetamine.  Upon being indicted, Mr. Bazan also attempted to intimidate a cooperating witness.  A six-time convicted felon, Mr. Bazan now faces up to life in prison.  The ATF and DEA conducted the investigation, along with the Gaines and Lea County Sheriff’s Offices.  

SENTENCING -- James Smith
On Jan.10, James Gabriel Smith, a former member of the military, was sentenced more than 12 years in federal prison after pleading guilty to attempted enticement of a minor.  Smith, a former resident of Saginaw, Texas, admits he chatted online with an undercover NCIS agent posing as a 13-year-old girl.  Over the span of three months, Smith sent graphic images of himself and told the 'girl' he wanted to engage in sexual activity with her.  When Smith showed up to an apartment in Fort Worth in April 2018, he was arrested by NCIS agents and Fort Worth police.  

SENTENCING -- William Smith 
On Jan. 11, William Brian Smith (no relation to above) was sentenced to 15 years' inprisonment followed by lifetime supervision after pleading guilty to receipt of child pornography.  Smith, a resident of Fort Worth, was discovered with child pornography on his work computer after one of his co-workers complained.  At his sentencing, Smith admitted to surreptitiously recording a child taking a shower -- and to taking surreptitious recordings of his female coworkers.  The case was investigated by Saginaw Police Department and Homeland Security Investigations.

* An indictment is a formal accusation of criminal conduct, not evidence. A defendant is presumed innocent unless convicted through due process of law.

 

NOTE: Due the the lapse in appropraitions, the U.S. Attorney's Office in the Northern District of Texas will not be issuing press releases or distributing news roundups via email. We will, however, post roundups online. 

Two Dallas men were charged with hate crimes today for using the Grindr app to lure men to an apartment complex, where the men were assaulted, taunted and robbed, announced U.S. Attorney for the Northern District of Texas Erin Nealy Cox.

A federal grand jury indicted Daniel Jenkins, 19, and Michael Atkinson, 24, for conspiracy to commit hate crimes, kidnapping, and carjacking. Mr. Jenkins was also charged with brandishing a firearm during a crime of violence.

According to the 15-count indictment – which supersedes an indictment filed under seal in August 2018 – members of the conspiracy set up fake profiles on Grindr, a social media dating platform for GBTQ men, to lure gay men to an apartment complex in Pleasant Grove, Texas in order to commit violent crimes against them including assaults, kidnapping, and carjacking.  For approximately one week in December 2017, the conspirators lured at least nine victims, ages 19 to 57, to Solana Ridge Apartments.

On December 6, 2017, members of the conspiracy used Grindr to lure John Doe 8 to the Solana Ridge Apartments in Pleasant Grove. Jenkins and another unidentified man held John Doe 8 at gunpoint in a vacant apartment.  Jenkins and his coconspirator took John Doe 8’s cellular phone and other property.  The next day, John Doe 9 was contacted through Grindr and lured to the Solano Ridge Apartments where he was carjacked at gunpoint and forced to drive to local ATMs in order to withdraw cash.

On December 7, 2017, members of the conspiracy used Grindr to lure John Doe 1 to the Solano Ridge Apartments.  He was robbed at gunpoint, carjacked and forced to drive his attackers to local ATMs to withdraw cash.  On December 8, 2017, members of the conspiracy used Grindr to lure John Doe 2 to the Solana Ridge Apartments.  A member of the conspiracy held John Doe 2 at gunpoint and demanded his property.  A member of the conspiracy hit John Doe 2 in the head with an object.

On December 11, 2017, the conspirators used Grindr to lure another 4 men to the Solano Ridge Apartments.  Jenkins met victims at their cars and invited them inside of Apartment # 186.  According to the indictment, Atkinson brought a handgun to Apartment # 186.  According to the indictment, Jenkins pointed a handgun toward at least one victim, physically assaulted at least two others and called the victims homophobic slurs.  At least one victim was sexually assaulted and at least one victim was smeared with human feces.

“Criminals are using apps like Grindr to single out victims based on their sexual orientation,” said U.S. Attorney Nealy Cox. “My office is committed to rooting out these despicable crimes motivated by hate.”

“As the lead agency for the investigation of federal hate crime violations, the FBI is committed to aggressively identifying and pursuing those using online apps, such as Grindr, to commit acts of violence or intimidation against an individual or community based on their protected class status,” said FBI Special Agent in Charge of the Dallas Office Eric Jackson.

An indictment is merely an accusation, and the defendants are presumed innocent unless and until proven guilty. If convicted, both defendants face a maximum statutory penalty of life in prison for the hate crime and kidnapping charges, 15 years for the carjacking changes, five years for the conspiracy charge, and a fine of up to $250,000 with respect to each charge. Jenkins also faces a mandatory minimum of at least seven years in prison plus a $250,000 fine for each firearms charge.

The Federal Bureau of Investigation’s Dallas Field Office conducted the federal investigation; a separate criminal investigation is being conducted by the Dallas Police Department. Assistant U.S. Attorney Nicole Dana of the Northern District of Texas and Trial Attorneys Rose Gibson and Kathryn Gilbert of the Justice Department’s Civil Rights Division are prosecuting the case.

This is not the first hate crime case involving the use of the Grindr app; four men pleaded guilty to hate crimes in the Eastern District of Texas in 2018. All four men were sentenced to at least a decade in prison after admitting they used Grindr to arrange a meet-up at a victim’s home, where they physically assaulted, ridiculed, and robbed him. 

IDICTMENT* – Joseph McDonell, 40
On Dec. 18, a federal grand jury returned a nine-count indictment against Joseph Heath McDonell, of Dallas, charging access device fraud and identity theft.  McDonell was found in possession of credit and debit card making equipment, stolen personal identifying information, thousands of counterfeit credit card numbers, and several counterfeit Texas DPS drivers permits.  If convicted, Mr. McDonell faces up to more than 4 years in federal prison.  The FBI and Dallas Police Department investigated the case.

INDICTMENT* – Vinson Burnett, 53
On Dec. 18 a federal grand jury indicted Vinson Burnett of Mesquite, Texas for using a peer-peer file sharing program to share and receive child pornography. Two different law enforcement agencies were able to download child pornography from Burnett over a two month period.  Upon execution of a search warrant, child pornography was found on a cell phone and a computer hard drive.  If convicted, Mr. Burnett faces up to 40 years in federal prison.  The Mesquite Police Department and HSI investigated the case.

INDICTMENT* - Quentin Amoako, 30
On Dec. 18, a federal grand jury indicted Quentin Amoako, of Dallas, for possessing with intent to distribute crack cocaine.  Amoako was also indicted for possessing a firearm in furtherance of his drug trafficking activities.  If convicted, Mr. Amoako faces up to 25 years in prison, with a mandatory minimum of 5 years in federal prison.  The FBI investigated. This case stemmed from a  Project Safe Neighborhood investigation, an initiative bringing together federal and local law enforcement to stem violent crime in hard-hit communities.

INDICTMENT – RXpress owners & marketers
Eight Dallas-area pharmacy owners and marketers were indicted for their roles in a scheme involving approximately $92 million in compound drug claims to TRICARE and the U.S. Labor Department, which were allegedly the product of over $9.1 million in illegal kickbacks. DCIS, HHS, the FBI, and the VA – Inspector General investigated the case. Release here.

INDICTMENT* – Katie Jeanne Johnson, 30
On Dec 18, a federal grand jury indicted Katie Jeanne Johnson for intent to rob a Bank of America in Garland, Texas.  If convicted, Ms. Johnson faces up to 20 years in federal prison. The FBI investigated the case. 

SENTENCING -- Kenneth Wines, 44
On Dec. 17, Kenneth Wines was sentenced to 13 months’ imprisonment for his role in a prison bribery scheme.  Wines, an inmate at the Federal Correctional Institute at Seagoville, Texas, was serving a 35-year sentence for drug trafficking when he and another inmate bribed a prison employee to smuggle contraband, including cigarettes and K2, into the prison in exchange for money.  The court ordered Wines to serve the 13-month sentence consecutive to his undischarged 35-year sentence. 

* An indictment is a formal accusation of criminal conduct, not evidence. A defendant is presumed innocent unless convicted through due process of law.

Zhang Xiao Dong (aka “Mark Zhang”), of Shanghai, China, was sentenced in Dallas today to 24 months’ imprisonment and two years of supervised release in connection with a scheme to sell mislabeled dietary supplements, the Department of Justice announced. 

Zhang was the Sales Manager for Genabolix USA, Inc. and Shanghai Yongyi Biotechnology Co., Ltd., Chinese firms that sell raw ingredients for use in dietary supplements. Zhang pleaded guilty in April 2018 in the Northern District of Texas to one count of mail fraud.  Zhang’s co-defendant, Gao Mei Fang (a.k.a. Amy Gao), the Supply Chain Manager for Genabolix, was sentenced on July 17, 2018, to 12 months and a day of imprisonment after pleading guilty in April 2018.

In pleading guilty, Zhang and Gao admitted that they agreed to help sell synthetic stimulant ingredients to a purported dietary supplement manufacturer in the United States. According to an indictment returned in October 2017, Zhang, Gao, and another co-defendant agreed with a confidential government informant to either mislabel the synthetic ingredients or to otherwise help hide the true nature of a proposed dietary supplement from retailers. Zhang and Gao admitted that they knew major American dietary supplement retailers would refuse to carry supplements known to contain certain stimulants, such as DMAA. Gao also admitted to making false statements to FDA’s import division regarding a shipment of synthetic stimulants entering the United States.

“Americans must be able to trust that the products they consume are safe,” said Assistant Attorney General Jody Hunt for the Department of Justice’s Civil Division. “This case shows that we will continue to prosecute those who attempt to import dangerous ingredients into the United States.”

Zhang and Gao were sentenced by U.S. District Court Judge Lindsay of the Northern District of Texas. Gao and Zhang both were arrested in September 2017 while attending a dietary supplement trade show in Las Vegas. A third defendant named in the case, Hu Chang Chun, is not believed to be in the United States.

“Consumers deserve to know exactly what they’re ingesting,” said U.S. Attorney Erin Nealy Cox of the Northern District of Texas. “We will not allow this sort of subterfuge to go unchecked in north Texas.”

“American consumers are put at risk when the true nature of ingredients for dietary supplements is hidden,” said Charles L. Grinstead, Special Agent in Charge, FDA Office of Criminal Investigations’ Kansas City Field Office. “We will continue to pursue and bring to justice those who jeopardize the public health.” 

The case was investigated by FDA’s Office of Criminal Investigations. The case was prosecuted by David Sullivan and Patrick R. Runkle, Trial Attorneys in the Department of Justice’s Consumer Protection Branch, and Kate Rumsey and Douglas Brasher, Assistant United States Attorneys for the Northern District of Texas.

Additional information about the Consumer Protection Branch and its enforcement efforts may be found at http://www.justice.gov/civil/consumer-protection-branch. For more information about the U.S. Attorney’s Office for the Northern District of Texas, visit its website at https://www.justice.gov/usao-ndtx.

Eight Dallas-area pharmacy owners and marketers were charged in an indictment unsealed today for their roles in a scheme involving approximately $92 million in compound drug claims to TRICARE and the U.S. Department of Labor (DOL), which were allegedly the product of over $9.1 million in illegal kickbacks.

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, Special Agent in Charge Michael Mentavlos of the Defense Criminal Investigative Service (DCIS) Southwest Field Office, Special Agent in Charge Steven Grell of the U.S. Department of Labor - Office of Inspector General’s (DOL-OIG) Dallas Region and Special Agent in Charge CJ Porter of the Office of Inspector General for the U.S. Department of Health and Services (HHS-OIG) made the announcement.

Richard Hall, 48; Scott Schuster, 47; Dustin Rall, 43; George Lock Paret, 34; and Michael Ranelle, 49, all of Fort Worth, Texas; John Le, 43, of Dallas; Quintan Cockerell, 37, of Manhattan Beach, California; and Turner Luke Zeutzius, 36, of Horseshoe Bay, Texas, were each charged in an indictment filed Dec. 12 in the Northern District of Texas with one count of conspiracy to defraud the United States and pay and receive kickbacks.  Hall, Schuster, Rall, and Le were each additionally charged with four counts of paying kickbacks.  Zeutzius was additionally charged with two counts of receiving kickbacks and Ranelle and Cockerell were each charged with one count of receiving kickbacks.  Hall, Schuster, Rall, Le and Ranelle were arrested yesterday and had their initial court appearances before U.S. Magistrate Court Judge Irma C. Ramirez in Dallas.   Paret, Cockerell and Zeutzius self-surrendered this morning and will have their initial court appearances today at 2 p.m. CST before Judge Ramirez.

According to the indictment, from May 2014 to September 2016, Hall, Schuster, Rall, Paret, Le and their co-conspirators allegedly engaged in a scheme to pay kickbacks and bribes for the referral of TRICARE and DOL beneficiaries to obtain expensive compound drugs.  Hall, Shuster and Rall were co-owners of Rxpress Pharmacy and Xpress Compounding, compound pharmacies located at 1000 W. Weatherford St. in Fort Worth. 

As alleged in the indictment, Rxpress and Xpress were separate in name only; Rxpress Pharmacy and Xpress Compounding employed the same staff, operated out of the same building, and utilized a call center to direct prescriptions depending on whether the prescriptions were for private or federal insurance.  The indictment alleges that both companies utilized the same marketers but paid them differently depending on whether they were receiving a commission on a federal or private prescription, in order to disguise the illegal kickback payments on federal prescriptions.  Specifically, Hall, Schuster, Rall, Paret and Le allegedly devised a scheme to make kickback payments to marketers through Xpress Compounding for the referral of federal prescriptions.  These marketers were allegedly set up as sham “W-2” employees to appear as though they were bona fide employees of Xpress Compounding.  At the same time, these marketers were paid as 1099 contractors by Rxpress Pharmacy, the indictment alleges. 

The indictment alleges that as a result of the scheme, Zeutzius was paid approximately $4.4 million, Cockerell (through an unnamed person) was paid approximately $2.1 million, and Ranelle was paid approximately $2.6 million in illegal kickbacks, for a total of approximately $9.1 million in illegal kickbacks. 

The charges in the indictment are merely allegations and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

DCIS, DOL-OIG, the U.S. Department of Health and Human Services Office of Inspector General, the FBI and the U.S. Department of Veterans Affairs Office of Inspector General investigated the case.  Assistant Chief Adrienne Frazior and Trial Attorney Brynn Schiess of the Criminal Division’s Fraud Section are prosecuting the case.

The Fraud Section leads the Medicare Fraud Strike Force, which is part of a joint initiative between the Department of Justice and the U.S. Department of Health and Human Services (HHS) to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country.  Since its inception in March 2007, the Medicare Fraud Strike Force, which maintains 14 strike forces operating in 23 districts, has charged nearly 4,000 defendants who have collectively billed the Medicare program for more than $14 billion.

Newly-released dash cam video shows the moment a drug trafficker with a distribution network worth hundreds of thousands of dollars fled the scene of an undercover drug buy.

At the wheel was Israel Vasquez, a 46 year-old-citizen of Mexico, who was sentenced last week to life in prison after pleading guilty to drug and money laundering charges earlier this year.

According to law enforcement, Mr. Vasquez’ methamphetamine distribution network stretched from Michoacán, Mexico, across the southern border, and into Texas and Louisiana. The drug ring netted hundreds of thousands of dollars in proceeds wired to his alias, “Adan Perez.”

Not long before the footage was recorded in March 2016, Grand Prairie Police officers initiated an undercover drug buy with a man later identified as Mr. Vasquez.  He agreed to meet an undercover agent behind a retail store in Grand Prairie. Just before the meeting, however, Mr. Vasquez seemed to grow suspicious, pitching about half a kilogram of meth out his car window and speeding away. The subsequent footage shows he led Grand Prairie Police on a wild chase, zig zagging through heavy traffic on Interstate 20, blasting through stop lights, and driving the wrong way on residential streets.  

After he ditched the vehicle, agents located a receipt inside that noted his alias, Adan Perez. They tracked Mr. Vasquez to Seattle, where he was arrested weeks later.

At sentencing, prosecutors revealed that at the time of the chase, Mr. Vasquez was a fugitive from justice, having fled to Mexico in 2010 after pleading guilty in another drug and money laundering case in 2009. While on the lam, Mr. Vasquez conspired with several co-defendants, including his wife and sister, to deal controlled substances, including meth and heroin, and move drug money into Mexico.   

According to law enforcement agents, in 2013, Vasquez was kidnapped by a cartel and tortured due to a drug debt; as soon as his family raised money to release him, he returned to dealing, and eventually traveled to the Dallas area, where he continued to deal meth and heroin.

Testimony revealed that his drug cell included his wife, Amber Vasquez, sentenced to 115 months on drug and money laundering charges; his sister, Mia Vasquez, sentenced to 38 months custody on drug charges;  David De Los Santos, sentenced to 151 months custody on drug and money laundering charges; and Melvin Williams, sentenced to 121 months custody on drug charges. He also had ties to notorious dealer Javier Guerra, a.k.a. Chop, who was sentenced to a term of 480 months on drug charges and 240 months on money laundering charges in August, testimony showed.  

The FBI, Dallas Police Department and Internal Revenue Service Criminal Investigation led the investigation with assistance from the Grand Prairie Police Department; the Texas Department of Public Safety; the DFW Department of Public Safety; the U.S. Department of State; the Drug Enforcement Administration; the Bureau of Alcohol, Tobacco, Firearms & Explosives; the Transportation Security Administration; the U.S. Secret Service; U.S. Immigration and Customs Enforcement’s Enforcement and Removal Operations; and the Fort Worth, McKinney, Mesquite, and Plano Police Departments. Assistant U.S. Attorneys George Leal, John Kull, and John De La Garza prosecuted the case for the government.The FBI, Dallas Police Department and Internal Revenue Service Criminal Investigation led the investigation with assistance from the Grand Prairie Police Department; the Texas Department of Public Safety; the DFW Department of Public Safety; the U.S. Department of State; the Drug Enforcement Administration; the Bureau of Alcohol, Tobacco, Firearms & Explosives; the Transportation Security Administration; the U.S. Secret Service; U.S. Immigration and Customs Enforcement’s Enforcement and Removal Operations; and the Fort Worth, McKinney, Mesquite, and Plano Police Departments. Assistant U.S. Attorneys George Leal, John Kull, and John De La Garza prosecuted the case for the government. 

SENTENCING – Israel Vasquez, 46
Israel Vasquez, a 46 year old citizen of Mexico, was sentenced to life in prison after pleading guilty to drug and money laundering charges in June. Vasquez’s methamphetamine distribution network stretched from Michoacan, Mexico, through the southern border, and into Texas and Louisiana, and collected hundreds of thousands of dollars in drug proceeds wired to Vaszquez’s alias, Adan Perez. According to law enforcement agents, in 2013, Vasquez was kidnapped by a cartel and tortured due to a drug debt; as soon as his family raised money to release him, he returned to dealing. He was apprehended weeks after he ditched a stash of meth and fled the scene of a planned undercover drug buy. The FBI, Dallas Police Department, and IRS - Criminal Investigation led the investigation.

ARREST – Drug traffickers
Thirteen people tied to Mexican cartels were arrested on federal drug conspiracy charges after an FBI-led bust on Dec. 12. Investigators say the individuals — who they say are connected to Mexico's Los Zetas and New Generation Jalisco cartels — have conspired to distribute methamphetamine, cocaine and heroin since March 2014. The criminal complaints were unsealed Wednesday afternoon. The DEA and Texas Department of Public Safety investigated. Release here.

PLEA -- Ramon Hernandez, 41
On Dec. 11, Ramon Hernandez pleaded guilty to conspiracy to commit wire fraud. Hernandez admits that at the direction of a coworker, he stole medical equipment from his employer, made fraudulent entries in their database concerning the shipment of the equipment, and manipulated the devices’ electronic serial plates to conceal the theft. He now faces 5 years in prison. The FBI and FDA Office of Inspector General investigated.

SENTENCING – Eddie Contreraz, 49
On Dec. 10, Eddie Contreraz of Frisco, TX was sentenced to more than 14 years in federal prison and ordered to pay $12,949,309 in restitution for his role as the ring leader of a $29 million bank fraud scheme. He and six co-defendants admit they used falsified income and employment information to complete at least 2300 fraudulent loan packages at 10 banks. The FBI’s Fort Worth Office conducted the investigation.

SENTENCING – Jesus Chaparro, 26
On Dec. 7, Jesus Florencio Chaparro-Sanchez, a 26-year-old citizen of Mexico, was sentenced to 14 ¼ years in federal prison after authorities caught him transporting fentanyl, a powerful narcotic 50 times more potent than heroin. After a traffic stop, he admitted to investigators that a man in Mexico had offered him a job transporting drugs. He claimed he thought he was transporting cocaine.  DEA testing revealed that the substance was actually about four kilograms of Tramadol plus about five kilograms of fentanyl. The DEA and the Texas Department of Public Safety investigated. Release here.

- - -

AAG Visits Dallas

On Dec. 12, the Northern District of Texas welcomed Acting Attorney General Matt Whitaker, along with Solicitor General Noel Francisco and Assistant Attorney General Brian Benczkowski of DOJ’s Criminal Division, to discuss our Project Safe Neighborhoods program, which diminished violent crime in Dallas’ PSN hotspot by 19.9 percent from Q1 to Q3. “Our goal is to reduce violent crime. Thanks in large part to people in this room, we are achieving that goal,” Whitaker told law enforcement gathered at the Dallas Police Department’s NE Division. “That is why the Department of Justice is proud to invest in you.” Whitaker remarks here. Photos here.                                                                                           

Thirteen individuals were arrested on federal drug conspiracy charges following a bust led by the FBI Wednesday morning, U.S. Attorney for the Northern District of Texas Erin Nealy Cox announced today.

According to criminal complaints unsealed this afternoon, the defendants -- Juan Hernandez, Humberto Morales, Marcos Dominguez, Adolfo Ortiz, Albert Martinez, Alejandro Navarrete, Oscar Hernandez, Rebecca Mier, Leoncio Aguilar, Josue Coy, Fidel Alain Martin-Sosa, Yuniel Eduardo Lima Rivero, and Henry Alberto Echarte Rivero – conspired to distribute methamphetamine, cocaine, and heroin over a nearly five-year period, beginning in March 2014.

According to Organized Crime Drug Enforcement Task Force (OCDETF) investigators, the conspirators -- who had ties to the Los Zetas and the New Generation Jalisco Mexican cartels -- had a fluid hierarchy that evolved over time.  Some of the money derived from the sale and distribution of the drugs were used to purchase additional drugs, while other drug money was sent to Mexico. 

The investigation culminated yesterday, when FBI agents raided a home just across the street from a Grand Prairie elementary school, seizing 380 grams of heroin, a shotgun, and approximately 5 kilograms of methamphetamine. Additional agents seized seven firearms and ounce quantities of cocaine from two houses in Dallas. Agents in Carrollton, assisted by Carrollton Police Department seized 3 kilograms of methamphetamine that defendants Lima Rivero and Echarte Rivero attempted to discard.

In total, law enforcement also seized approximately $24,800 in U.S. currency.

A complaint is a written statement of the essential facts of the offense charged made under oath before a magistrate judge.  The government has 30 days to present the matter to a grand jury for indictment.  A defendant is entitled to the presumption of innocence until proven guilty through due process of law.

If convicted, defendants face up to 40 years in federal prison and a $5,000,000 fine.

The Federal Bureau of Investigation, in collaboration with the Bureau of Alcohol, Tobacco and Firearms, Texas Department of Public Safety, Dallas Police Department, Fort Worth Police Department, Carrolton Police Department, Grand Prairie Police Department, Arlington Police Department, Farmers Branch Police Department, and the Internal Revenue Service, conducted the investigation. Assistant U.S. Attorneys Shawn Smith and Laura Montes are prosecuting the case. 

The case was investigated as part of the Organized Crime Drug Enforcement Task Force (OCDETF). The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply. 

In 2015, Alexis C. Norman pleaded guilty to healthcare fraud. But while awaiting sentencing, she concocted another healthcare fraud scheme.  

Yesterday afternoon, Ms. Norman, 47, pleaded guilty once again, this time admitting one count of conspiracy to commit healthcare fraud and four counts of healthcare fraud – three committed before she was sentenced in the prior case and one committed while she was behind bars, announced U.S. Attorney for the Northern District of Texas Erin Nealy Cox.  

According to court documents, Ms. Norman approached co-conspirator Karen Jones in February 2015 with a business idea she hoped could help pay legal fees from her previous case.  Ms. Jones agreed to help Ms. Norman by listing herself as the administrator of Janus Children Services, Inc., opening a bank account in Janus’ name, and leasing office space for Janus in Tyler, Texas.

The company never occupied the office space, never hired any employees, and never provided any services.

Together, Ms. Norman and Ms. Jones used stolen identities of licensed counselors and Medicaid recipients to submit more than $810,000 in fraudulent claims to Medicaid, and were paid more than $427,000.

After Medicaid paid Janus for the false claims, Ms. Norman directed Jones to withdraw cash from the Janus bank account, always in amounts less than $9,500. Roughly once a month from April 2015 to February 2016, the pair would meet at a restaurant. When they finished their meal, Ms. Jones – who carried the cash in a gift bag – would leave the package on a chair for Ms. Norman.  

Following Ms. Norman’s incarceration in April 2016, Ms. Jones agreed to help Ms. Norman submit additional fraudulent claims through a second company, Therapeutic Outreach Services Inc.

Ms. Jones helped Ms. Norman lease office space for Therapeutic in Waco, Texas, and visited Ms. Norman in prison on multiple occasions to gather billing instructions and identifying information of counselors and Medicaid clients.  Ms. Norman concealed the information on a piece of paper hidden in her shoe, which she retrieved during Ms. Jones’ visits.

Like Janus, Therapeutic never operated out of the Waco location, had no employees, and provided no services.

Ms. Norman faces a maximum statutory penalty of 80 years in federal prison, mandatory restitution, and a $250,000 fine for each of the five counts.  She is scheduled to be sentenced by U.S. District Judge Jane Boyle on March 29.  

Ms. Jones, who has also pleaded guilty, faces a maximum statutory penalty of five years in federal prison, mandatory restitution, and a $250,000 fine. She is scheduled to be sentenced on January 14, 2019, by U.S. District Court Judge David C. Godbey. 

The U.S. Department of Health and Human Services – Office of Inspector General and the Texas Attorney General’s Medicaid Fraud Control Unit conducted the investigation.  Assistant U.S. Attorney Douglas Brasher and DOJ Trial Attorney Christina Liu are prosecuting the case.

A 26-year-old citizen of Mexico was sentenced today to 135 months in federal prison after authorities caught him transporting fentanyl, a powerful narcotic 50 times more potent than heroin, announced U.S. Attorney for the Northern District of Texas Erin Nealy Cox.

Jesus Florencio Chaparro-Sanchez pleaded guilty to possession with intent to distribute in August.

In late May, a Texas Department of Public Safety trooper stopped Mr. Chaparro-Sanchez, who was driving a black Pontiac G6, for traffic violations. Near the vehicle’s rear axle, the officer located an after-market compartment. Inside, investigators discovered nine bundles of a white powdery substance.

 

Mr. Chaparro-Sanchez later admitted that a man in Mexico had offered him a job transporting the drugs.  He said he knew the vehicle contained drugs, and claimed he thought he was transporting cocaine.  DEA testing revealed that the substance was actually about four kilograms of Tramadol plus about five kilograms of fentanyl. 

“This deadly drug is wreaking havoc across the country. Many users don’t realize traffickers are cutting other, less potent drugs with cheap fentanyl,” said Nealy Cox. “We have zero tolerance for those that support the distribution of dangerous drugs in America and we will do everything in our power to stop fentanyl’s spread across North Texas.”

“The country is battling an opioid epidemic that is taking lives by the minute.  Fentanyl is fueling this deadly epidemic,” said DEA Special Agent in Charge of the Dallas Division Clyde E. Shelley, Jr. “DEA Dallas will aggressively investigate and prosecute any and all persons involved in the illegal distribution of fentanyl throughout North Texas and Oklahoma.” 

Fentanyl, which  results in frequent overdoses, is responsible for the sharp increase in opioid deaths across the U.S.  In just three years, the fentanyl death toll has risen more than 5,000 percent, from around 5,500 death in 2014 to almost 30,000 last year, according to the National Institute of Health. Because it can be ingested, inhaled, or absorbed through the skin, fentanyl poses a high risk of death not only to users, but to law enforcement. Just a few milligrams, equivalent to a few grains of table salt, may be deadly.

The Drug Enforcement Administration and the Texas Department of Public Safety conducted the investigation. Assistant U.S. Attorney Juanita Fielden is prosecuting the case.

 Dallas’ Project Safe Neighborhoods Taskforce earned one of just two “Outstanding Overall Partnership” awards from the U.S. Department of Justice, U.S. Attorney for the Northern District of Texas Erin Nealy Cox announced today.

Dubbed “Operation Badge #10934” in honor of fallen Dallas Police Officer Rogelio Santander, Dallas PSN was launched in February 2018 to tackle increasing violent crime. Led by U.S. Attorney Nealy Cox and Dallas Police Chief Renee Hall, the PSN Taskforce –  a coalition of federal and local law enforcement that includes FBI, ATF, DEA, and the U.S. Marshals Service – has already made more than 120 arrests inside the PSN “hotspot,” a historically crime-riddled community nestled at the intersection of Route 75 and LBJ.

Over the past eight months, the hotspot has seen a 19.9% reduction in violent crime.

“Our PSN Taskforce in Dallas is Texas-sized,” Acting Attorney General Matt Whitaker said at an awards ceremony in Kansas City, MO Thursday. “It brings together 60 people, including law enforcement officers, local government officials, local school personnel, and 15 community organizations.”

“I’m incredibly proud of the way we’ve been able to marshal resources from federal and local law enforcement to foster lasting change in a neighborhood that sorely needs our help,” said Nealy Cox. “None of this would have been possible without our law enforcement team, which includes DPD Chief Hall, FBI SAC Eric Jackson, DEA SAC Clyde Shelley, ATF SAC Jeffrey Boshek, U.S. Marshal Rick Taylor, and many others.”

“I am extremely proud of the partnership between the Dallas Police Department and U.S. Attorney’s Office with Project Safe Neighborhood,” Chief Hall said in a statement. “The work of the Dallas Project Safe Neighborhood team is making a difference and being recognized by the Department of Justice.  This enforcement effort is beneficial and allows us to focus on concentrated crime areas, while engaging with the community.”   

Dallas’ PSN initiative relies on a three-pronged approach combining traditional enforcement, community outreach, and recidivism reduction.  Federal prosecutors have charged dozens of individuals with felony crimes, from carjacking to straw purchasing. They’ve also held nearly 50 community events to explain how residents can help keep communities safe, and hosted nearly 2,500 ex-convicts and parolees at monthly “reentry nights” outlining ramifications of re-offending and presenting a buffet of resources, from job placement programs to counseling opportunities.

The Dallas PSN Taskforce is joined in the overall partnership category by Jackson, Mississippi’s PSN team. Ten other districts were honored for individual and organizational contributions to Project Safe Neighborhoods. The Northern District of Texas’ PSN operation is managed by Coordinator P.J. Meitl. More information on Dallas PSN here.

 

 A former Texas Christian University employee was sentenced today to five years in prison for theft of federal funds, announced U.S. Attorney for the Northern District of Texas Erin Nealy Cox.

Margaret Faust, 69, who served as Assistant Director of TCU’s Upward Bound program for roughly 18 years, pleaded guilty in August to embezzling money from the program, which helps low-income high school students prepare for college. 

According to court documents, Faust routinely pocketed cash from funds awarded to the university by the Department of Education. She stored the money – allotted for Upward Bound participant stipends – in a locked drawer inside her desk before depositing it in her personal checking account.

As part of her scheme, Ms. Faust instituted a program that allowed her to withhold the stipend money in $7 increments – about the cost of students’ bus fare, one former Upward Bound participant testified in court.

As a result of her conduct, TCU’s Upward Bound program was terminated.

Ms. Faust has paid back more than $210,000 – but it’s possible she stole significantly more than that, prosecutors told U.S. District Judge Reed O’Connor at her sentencing hearing today.

The Federal Bureau of Investigation and the U.S. Department of Education conducted the investigation. Assistant U.S. Attorney Megan Fahey prosecuted the case.

SENTENCING –Anthony Turner, 26,  Xavier Ross, 26  & Afraybeom Jackson, 28
On Nov. 28, Anthony Turner and Xavier Ross were sentenced to 7 years in federal prison for their roles in a robbery.  Co-conspirator Afraybeom Jackson was sentenced to nearly 6 years. The defendants pled guilty to interference with commerce by robbery and brandishing a firearm during a crime of violence after they were arrested for robbing a jewelry store in Irving, Texas. The FBI investigated the case.

SENTENCING – a Drug Trafficking Ring
On Nov. 28, six defendants were sentenced by U.S. District Judge Barbara M.G. Lynn for their roles in a cocaine trafficking organization:

• Bruce Turner, 40, aka “BK” – 12.5 years
• Desmond Keith Wright, 36, aka “Deedy Weedy” – 9 years
• Datanya Deone Jones, 37, aka “Worm” – 6.5 years
• Gerald Jerome Duncan, 30, aka “Bear” or “Osso” – 18 months
• Kennard Henry Richards-Darby, 28, aka “Boom” – time served
• Johnny Lee Edwards, 37, aka “Bubba” – 3 years’ probation

The FBI investigated the case; ATF, Dallas County Sheriff’s Office, and Dallas Police Department assisted with the takedown.

INDICTMENT* – Jared Rice, 30
On Nov. 28, AriseBank CEO Jared Rice Sr. was arrested by the FBI, charged with duping hundreds of investors out of more than $4 million in a cryptocurrency scheme. According to the indictment, Rice lied to would-be investors, falsely claiming that AriseBank could offer consumers FDIC-insured accounts and traditional banking services, including Visa-branded credit cards. If convicted, he faces 120 years in prison. The FBI investigated the case. Press release here.

SENTENCING – Jose Valentin, 39, Juan Gomez-Moreno, 28, & Gabriela Morales, 32.
On Nov. 28 and 29, three defendants were sentenced for their roles in a cocaine and methamphetamine distribution conspiracy. Jose Guadalupe Valentin, who was sentenced to 10 years in federal prison, pleaded guilty in June after Dallas DEA agents intercepted him on a wiretap negotiating and purchasing cocaine from a codefendant, and discovered cocaine, currency, and firearms at his home during a raid. Juan Alberto Gomez-Moreno, who was sentenced to nearly 6 years in prison, pleaded guilty in January, after DEA agents intercepted him on a wiretap negotiating meth. Gabriela Morales, who was sentenced to 14 years in prison, also pleaded guilty in January after DEA agents intercepted her on a wiretap making multiple deliveries of meth and cocaine to various customers in the Dallas area and collecting currency that represented the proceeds from drug trafficking.

PLEA – Marcus Jones, 29
On Nov. 27, Marcus Darwyn Jones of Arlington pleaded guilty to two counts of use of a facility of interstate commerce in aid of a racketeering enterprise.  Jones admitted to using Backpage.com to facilitate prostitution of two minor victims.  Homeland Security Investigations, the Texas Attorney General’s Office, and the Fort Worth Police Department investigated.

PLEA – Marcus Pierson
On Nov. 27, Marcus Jerod Pierson of Dallas pled guilty to one count of possession with intent to distribute a controlled substance. When Pierson was arrested, he had methamphetamine, cocaine, marijuana and a handgun in his vehicle.  He faces up to 20 years  in prison and a $1,000,000 fine. The DEA conducted the investigation.

PLEA – Christina Hickson, 23
On Nov. 27, Christina Michelle Hickson of Arkansas pleaded guilty to escape from federal custody. Hickson admits that on or about May 1, she escaped from the Volunteers of America Residential Re-Entry Center after a conviction for the commission of a bank robbery.  She faces up to five years in prison and a fine of $250,000.  The United States Marshal’s Service investigated.   

SENTENCING – Bruce Brick, 51
On Nov. 26, 2018, Bruce Brick was sentenced to 18 months in federal prison for escaping from a half-way house where he was residing for failure to register as a sex offender. On June 21, 2018, Brick pled guilty to one count of escape, after he was arrested in California and transported back to Texas by the U.S. Marshal’s Service. His new sentence is to run consecutively to the sentence he received in federal court in June 2015.

* An indictment is a formal accusation of criminal conduct, not evidence. A defendant is presumed innocent unless convicted through due process of law.

AriseBank CEO Jared Rice, Sr. was arrested by the FBI on Wednesday, charged with duping hundreds of investors out of more than $4 million in a cryptocurrency scheme, announced U.S. Attorney for the Northern District of Texas Erin Nealy Cox.

Mr. Rice, who is also the subject of a civil action filed by the SEC’s Fort Worth regional office earlier this year, was indicted on three counts of securities fraud and three counts of wire fraud.

According to court documents unsealed today, Mr. Rice, 30, allegedly lied to would-be investors, claiming that AriseBank – which he billed as the world’s “first decentralized banking platform” based on a proprietary digital currency called AriseCoin – could offer consumers FDIC-insured accounts and traditional banking services, including Visa-brand credit and debit cards, in addition to cryptocurrency services.  In actuality, AriseBank had not been authorized to conduct banking in Texas, was not FDIC insured, and did not have any sort of partnership with Visa.

Even as he touted AriseBank’s nonexistent benefits in press releases and online, Mr. Rice quietly converted investor funds for his own personal use, spending the money on hotels, food, clothing, a family law attorney, and even a guardian ad litem.

He allegedly falsely claimed the “Initial Coin Offering,” or ICO, had raised $600 million within just a few weeks and failed to disclose that he’d plead guilty to state felony charges in connection with a prior internet-related business scheme.  Meanwhile, investors were buying AriseCoin using digital currencies like Bitcoin, Ethereum, Litecoin, and fiat currency.

“My office is committed to enforcing the rule of law in the cryptocurrency space,” said Nealy Cox. “The Northern District of Texas will not tolerate this sort of flagrant deception – online or off.”

An Indictment is a formal accusation of criminal conduct, not evidence. A defendant is presumed innocent unless convicted through due process of law. If convicted, Mr. Rice faces up to 120 years in federal prison.

The Federal Bureau of Investigations conducted the investigation. Assistant U.S. Attorneys Mary Walters and Sid Mody are prosecuting the case.

Following a sting operation at a Dallas hotel earlier this month, law enforcement liberated dozens of women sold for sex, announced U.S. Attorney for the Northern District of Texas Erin Nealy Cox. This week, a federal grand jury indicted Helen Kim – the alleged proprietor of the prostitution ring – on racketeering charges.  

“It takes a lot of coordination to ensure an operation like this goes without a hitch. I’m proud of the way law enforcement came together to fight for these young women,” said Nealy Cox. “The defendant’s willingness to demean women for financial gain is sickening. We cannot and will not allow this type of behavior to go unchecked in North Texas.”

More than 50 officers from the Dallas Police Department, the Texas Department of Public Safety, and Homeland Security Investigations participated in the Nov. 1 undercover operation. Agents, posted at the hotel bar and in rooms upstairs, posed as out-of-town businessmen prepared to pay for illicit sex.

According to the indictment, Ms. Kim, 58, had agreed to provide dozens of women for that very purpose.

In earlier conversations with a confidential informant and an undercover Dallas Police Department detective, Ms. Kim and her 36-year-old son allegedly negotiated private sexual liaisons with 20 to 25 women at a rate of $2,000 each, for a total of at least $40,000. The pair promised the “girlfriend experience,” and even allowed the CI and UD to meet several of the women at a local Sushi bar.

During another meeting at a nearby Starbucks, Ms. Kim allegedly accepted an upfront payment of $5,000. She insisted the men should not talk publicly about the affair. 

“The way this is set up,” her son told the undercover officer, “it could be considered human trafficking.”

At the Nov. 1 sting, Ms. Kim accepted the remainder of the cash, paid in marked bills, and was taken into custody shortly thereafter. Several of the women in her employ were taken to Mosaic House, a local shelter for women fleeing human trafficking. Many had been living at her purported “spas,” Pink One and Illusion, impelled to cater to customers at all times of the day and night. 

If convicted, Kim faces up to five years in federal prison. Prosecutors have seized assets from her home and massage parlors. 

An Indictment is a formal accusation of criminal conduct, not evidence. A defendant is presumed innocent unless convicted through due process of law.  Assistant U.S. Attorneys Ryan Raybould and Cara Foos Pierce are prosecuting the case.

At the Nov. 1 sting, Ms. Kim accepted the remainder of the cash, paid in marked bills, and was taken into custody shortly thereafter. Several of the women in her employ were taken to Mosaic House, a local shelter for women fleeing human trafficking. Many had been living at her purported “spas,” Pink One and Illusion, impelled to cater to customers at all times of the day and night. 

If convicted, Kim faces up to five years in federal prison. Prosecutors have seized assets from her home and massage parlors. 

An Indictment is a formal accusation of criminal conduct, not evidence. A defendant is presumed innocent unless convicted through due process of law.  Assistant U.S. Attorneys Ryan Raybould and Cara Foos Pierce are prosecuting the case.

Eight defendants are in federal custody following their arrests in October and November 2018 on federal drug conspiracy charges, announced Erin Nealy Cox, U.S. Attorney for the Northern District of Texas. 

The defendants -- Lea Lea Bills, of Stephenville, Texas, Jeanne Butler, of Stephenville, Texas, Shauna Michelle Campbell, of Morgan Mill, Texas, Edward Martin Carranza, of Dublin, Texas, Michael Tyler Davidson, of Stephenville, Texas, David Wayne Green, of Lipan, Texas, Brad Keith, of Stephenville, Texas, and Michaela Danese Moncrief, of Dublin, Texas -- were all charged with one count of conspiracy to possess with the intent to distribute a controlled substance, and made their initial appearance before U.S. Magistrate Judge Jeffrey Cureton.   

According to a Complaint filed last month, from about July 2017 through August 30, the defendants conspired together, and with others, to possess with the intent to distribute 50 grams or more of methamphetamine throughout the Northern District of Texas and elsewhere. 

Members of the conspiracy had a fluid hierarchy that evolved over time.  Some of the money derived from the sale and distribution of the methamphetamine was used to purchase additional quantities of methamphetamine. 

A complaint is a written statement of the essential facts of the offense charged and must be made under oath before a magistrate judge.  The government has 30 days to present the matter to a grand jury for indictment.  A defendant is entitled to the presumption of innocence until proven guilty through due process of law.

If convicted, defendants face up to 40 years in federal prison and a $5,000,000 fine.

 The Drug Enforcement Administration and Stephenville Police Department are in charge of the investigation. Assistant U.S. Attorney Shawn Smith is prosecuting the case. 

A Fort Worth Man was sentenced today to 10 years in prison for the May 2018 Hulen Mall arson, announced U.S. Attorney for the Northern District of Texas Erin Nealy Cox.

In July, Craig Michael Tezeno, 46, of Fort Worth, Texas, pleaded guilty to igniting several Molotov cocktails inside two department stores in Fort Worth’s Hulen Mall. 

According to court documents, Tezeno admits he lit a rag stuffed into a glass bottle filled with gasoline and placed it on the floor of Dillard’s department store on May 11. Later that same day, he lit a similar device inside a Sears.  He returned to the same Sears a week later and ignited a third device, hoping to start a fire and damage the store. 

The Federal Bureau of Investigation and the Fort Worth Police Department investigated the case, with assistance from the Bureau of Alcohol, Tobacco, Firearms & Explosives, the Fort Worth Fire Department’s Arson Investigations Unit, the Tarrant County District Attorney’s Office, and FBI Task Force Officers from the Tarrant County Sherriff’s Office, the Arlington Police Department, the Naval Criminal Investigation Service, the Department of Homeland Security, and the Texas Department of Public Safety. Assistant U.S. Attorney Jay Weimer prosecuted the case.

SENTENCING – Eddie Galindo-Mendez, 44
On Nov. 9, Eddie Estuardo Galindo-Mendez was sentenced to just under 5 years in federal prison after pleading guilty to bank robbery. He admits that he robbed Lubbock’s Happy State Bank in November 2017. Dressed in a large coat, gloves, hat, and sunglasses, Mr. Galindo approached a teller and handed him a note threatening an active bomb. He then placed what appeared to be a pipe bomb next to the teller’s computer. After the teller surrendered the money, Mr. Galindo took the note and fled on a bicycle, leaving the purported bomb at the bank.  (The bomb squad later determined the device – galvanized pipe and wires wrapped in duct tape and connected to a cell phone – was inert.) The Bureau of Alcohol, Tobacco & Firearms conducted the investigation..

PLEA – Michael Asagba, 20
On Nov. 13, Michael Asagba of Mesquite, TX  pleaded guilty to three counts of aggravated robbery and one count of using a firearm, during a crime of violence on November 13. Mr. Asagba admits to a string of food store robberies in Mesquite in late February. He now faces a minimum of 7 years and a maximum of 67 years in prison. The Bureau of Alcohol, Tobacco & Firearms investigated.

INDICTMENT* -- Adrian Martinez, 44
On Nov. 14, a federal grand jury indicted Adrian Martinez, a CPS worker, on one count of enticement of a child.  In September, Martinez contacted an undercover officer, who was posing as a 14-year-old girl, through the Skout social networking application and stated that he was looking for a friends-with-benefits situation.  He engaged in sexually explicit communications with the undercover officer and asked if the girl would skip school to meet him.   They agreed to meet at a Quik Trip in Haltom City on September 25.  When Martinez arrived, he was arrested.  During his interview later that day, Martinez stated that he had been chatting with five to six underage girls at the time of his arrest. The Texas Department of Public Safety and FBI investigated the case. 

* An indictment is a formal accusation of criminal conduct, not evidence. A defendant is presumed innocent unless convicted through due process of law.

A Dallas, Texas, area tax return preparer pleaded guilty today to conspiring to defraud the United States and to assisting in the preparation of false tax returns, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Erin N. Cox for the Northern District of Texas. 

According to documents and information provided to the court, Mario Melendez, 29, worked as a manager and tax return preparer at Uptown Multi Services, which was a tax preparation business located in the Northern District of Texas. 

From November 2013 and continuing through at least May 2014, Melendez conspired with others to prepare federal income tax returns for clients that included false education credits and Schedule C expenses as well as other fraudulent items. As the manager of Uptown, Melendez taught training classes for new return preparers during which he instructed employees how to prepare fraudulent tax returns in order to maximize client refunds. Melendez is responsible for attempting to cause a tax loss of over $3.8 million to the United States.

Sentencing is scheduled for April 5, 2019.  Melendez faces a statutory maximum of eight years in prison, as well as a period of supervised release, restitution, and monetary penalties.

Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Cox commended special agents of IRS-Criminal Investigation, who investigated the case, and Trial Attorney Alexander Effendi of the Tax Division and Assistant United States Attorney Melanie Smith, who are prosecuting this case.

Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.

U.S. Attorney Erin Nealy Cox is proud to announce the appointment of four new Assistant United States Attorneys: Kristina Williams, assigned to the Dallas Appellate Division, Tiffany Eggers, assigned to the Dallas Criminal Division, Laura Montes, assigned to the Fort Worth Criminal Division, and Ann Howey, assigned to the Lubbock Criminal Division.

All four prosecutors were sworn in on November 9 before Chief U.S. District Judge Barbara M.G. Lynn.

A graduate of Texas A&M University and the University of Houston Law Center, Ms. Williams previously served as a Senior Attorney at Dykema Cox Smith, where she represented clients before the U.S. Supreme Court, U.S. Court of Appeals for the Fifth Circuit, and the Texas Court of Appeals. She also served as a Term Law Clerk under the Honorable Edith H. Jones of the United States Court of Appeals for the Fifth Circuit, as a Law Clerk for The Honorable Nathan Hecht of the Supreme Court of Texas, and as a Clerk for Sen. John Cornyn, R-TX, at the Senate Judiciary Committee.

Ms. Eggers joins the Northern District of Texas from the Northern District of Florida, where she spent more than 13 years prosecuting federal crimes, focusing on money laundering and fraud. Before that, she served as an Assistant State Attorney in the First Judicial Circuit of Florida’s State Attorney’s Office. Ms. Eggers received her undergraduate degree from Jacksonville State University and her law degree from Florida State University College of Law.

A graduate of Wheaton College and Northeastern University School of Law, Ms. Montes joins the Northern District of Texas from the U.S. Attorney’s Office of the District of Puerto Rico, where she prosecuted cases for the Organized Crime Drug Enforcement Task Force (OCDETF) for three years. Prior to her work there, she spent two years prosecuting cases at the Middlesex District Attorney’s Office in Massachusetts and served as a Law Student Clerk at the United States Court of Appeals for the First Circuit.

Before joining the U.S. Attorney’s Office, Ms. Howey served as an attorney advisor for U.S. District Court Clerk’s Office here in the Northern District of Texas. While there, she evaluated proposed national legislation, rules, and policy to determine impact on local civil and criminal procedure. Prior to that, she serve as Assistant General Counsel at Texas Tech University System, where she received both her undergraduate and law degrees.

“We’re delighted to welcome these talented attorneys to offices across our district,” said Nealy Cox. “I’m confident they will serve the cause of justice with honor.”

INDICTMENT --- Robert Grafton, 52
On Nov. 7,  a federal grand jury indicted Robert Grafton, of Dallas, on three counts of bank robbery. Over a two week period, he allegedly robbed three Capital One bank locations in Dallas, brandishing a weapon and demanding bank tellers hand over the currency in the register. If convicted, Mr. Grafton faces up to 20 years in federal prison on each count. The FBI along with the Dallas Police Department investigated the case.

SENTENCING – Lawrence Shahwan, 41
On Nov. 6, 41- year-old Lawrence Shahwan, the lead defendant in the Gas Pipe synthetic cannabinoid case, was sentenced to six years in federal prison. In March 2015, Mr. Shahwan pleaded guilty to conspiracy to contribute a controlled substance analogue. He admits that for years, he manufactured so-called “spice” products – made using chemicals that mimic the effects of THC -- and distributed the product to head shops around Dallas, branded as “Assassin Revolution,” “Venom,” “Wolf Pack Rage,” etc. At sentencing, Chief Judge Barbara M.G. Lynn remarked on the dangers of synthetic cannabinoids, which can be fatal.  The Drug Enforcement Administration, the Duncanville, Desoto, and Dallas Police Departments, the Denton County Sheriff’s Office, Internal Revenue Service Criminal Investigation, and the U.S. Marshals Service conducted the investigation. More about the case here.

INDICTMENT -- Gary Lyn Black, 60
On Nov. 6, a federal grand jury indicted Gary Lyn Black – also known by the street name “Godsmack” -- for distributing more than 500 grams of methamphetamine, possessing a firearm in furtherance of a drug conspiracy, possessing a firearm as a convicted felon, and maintaining a drug-involved premises.  If convicted, Mr. Black, of Johnson County, faces a mandatory minimum sentence of 10 years in federal prison and a maximum sentence of life.  The Cleburne Stop the Offender Program investigated the case.

INDICTMENT – Gustavo Palafox-Acuna & Marcos Escalante-Acuna
On November 7, 2018, a federal grand jury indicted Gustavo Palafox-Acuna and Marcos Escalante-Acuna for conspiracy to possess with intent to distribute 500 grams or more of a mixture or substance containing a detectable amount of methamphetamine. The two were arrested on October 18, 2018, with approximately 113 pounds of methamphetamine.  

INDICTMENT – Eugene Mitchell, 44
On Nov. 6, a federal grand jury indicted Eugene Mitchell, of Chicago on a felon in possession of a firearm charge. If convicted, Mr. Mitchell faces up to 10 years in federal prison. The Bureau of Alcohol, Tobacco, Firearms, & Explosives and the Lancaster Police Department conducted the investigation.

U.S. Attorney Erin Nealy Cox has announced that Assistant United States Attorney (AUSA) Nicole Dana will lead the efforts of her office in connection with the Justice Department’s nationwide Election Day Program for the upcoming November 6, 2018, general election. 

AUSA Dana has been appointed to serve as the District Election Officer (DEO) for the Northern District of Texas, and in that capacity is responsible for overseeing the District’s handling of complaints of election fraud and voting rights abuses in consultation with Justice Department Headquarters in Washington.

“Every citizen must be able to vote without interference or discrimination and to have that vote counted without it being stolen because of fraud,” said Nealy Cox. “The Department of Justice will act promptly and aggressively to protect the integrity of the election process.”

 The Department of Justice has an important role in deterring election fraud and discrimination at the polls, and combating these violations whenever and wherever they occur.  The Department’s long-standing Election Day Program furthers these goals, and also seeks to ensure public confidence in the integrity of the election process by providing local points of contact within the Department for the public to report possible election fraud and voting rights violations while the polls are open on election day. 

Federal law protects against such crimes as intimidating or bribing voters, buying and selling votes, impersonating voters, altering vote tallies, stuffing ballot boxes, and marking ballots for voters against their wishes or without their input.  It also contains special protections for the rights of voters, and provides that they can vote free from acts that intimidate or harass them.  For example, actions of persons designed to interrupt or intimidate voters at polling places by questioning or challenging them, or by photographing or videotaping them, under the pretext that these are actions to uncover illegal voting may violate federal voting rights law.  Further, federal law protects the right of voters to mark their own ballot or to be assisted by a person of their choice (where voters need assistance because of disability or illiteracy).

The franchise is the cornerstone of American democracy.  We all must ensure that those who are entitled to the franchise exercise it if they choose, and that those who seek to corrupt it are brought to justice.  In order to respond to complaints of election fraud or voting rights abuses on November 6, 2018, and to ensure that such complaints are directed to the appropriate authorities, U.S. Attorney Nealy Cox stated that AUSA/DEO Nicole Dana will be on duty in this District while the polls are open.  She can be reached by the public at by phone at 214-659-8600.

In addition, the FBI will have special agents available in each field office and resident agency throughout the country to receive allegations of election fraud and other election abuses on election day.  The local FBI field office can be reached by the public at 972-559-5000.

Complaints about possible violations of the federal voting rights laws can be made directly to the Civil Rights Division’s Voting Section in Washington, DC by phone at 1-800-253-3931 or 202-307-2767, by fax at 202-307-3961, by email to voting.section@usdoj.gov or by complaint form at http://www.justice.gov/crt/complaint/votintake/index.php.

According to U.S. Attorney Nealy Cox, “Ensuring free and fair elections depends in large part on the cooperation of the American electorate.  It is imperative that those who have specific information about discrimination or election fraud make that information available immediately to my Office, the FBI, or the Civil Rights Division.”

SENTENCING -- Tanya Scroggins
On Oct. 25, Tanya Lynn Scroggins was sentenced to 17 ½ years in federal prison for her role in a methamphetamine ring managed by white supremacists.  In July, Scroggins pled guilty to one count of possession with intent to distribute, after Texas DPS agents found her with a significant amount of methamphetamine, multiple firearms, and a large amount of cash.

SENTENCING – Garry Newton, 21
On Oct. 31, Garry Dewayne Newton was sentenced to just shy of 3 years in federal prison on drug and firearms charges. He was one of 15 defendants indicted in December 2017 following an ATF investigation targeting a violent Dallas street gang known as “YNB StretchGang.” After agreeing to sell meth to a customer he later learned was an uncover law enforcement officer, Newton was arrested carrying multiple drugs, drug paraphernalia, and a stolen 9mm Taurus handgun. He later pleaded guilty to possession with intent to distribute methamphetamine and possession of a firearm by a user of a controlled substance. Newton admits that he and other YNB StretchGang members sold controlled substances, including meth, cocaine, alprazolam (Xanax), and marijuana, and produced music videos glorifying violence.

SENTENCING -- Shakil Mukadam
On Oct. 31, Shakil Mukadam was sentenced to more than 6 years in federal prison for robbing four Dallas banks over a two-day period in December 2017.  In March, Mukadam pled guilty to one count of robbing a Wells Fargo Bank in Dallas but admitted robbing a Chase Bank and two BBVA Compass Bank locations as well.  The FBI conducted the investigation.

SENTENCING -- Antwan Dickerson
On Oct. 31, Antwan Dickerson was sentenced to 2 years in federal prison for firearm possession by a convicted felon.  When Dallas Police Department executed a narcotics search warrant at Dickerson’s residence, they found multiple guns inside, including a shotgun that had been stolen from a federal firearms licensee.  The Bureau of Alcohol, Tobacco, Firearms and Explosives and the Dallas Police Department investigated the case.

PLEA – Patricia Armstrong, 32
Patricia Armstrong of Coppell, TX pleaded guilty to conspiracy to commit health care fraud on Nov. 1. Armstrong admits to participating in a scheme to defraud Medicare and Medicaid of over $60 million by causing those programs to be billed for hospice beneficiaries who were ineligible for hospice care, were fraudulently recruited to hospice care, or who were not provided billed-for services. She now faces up to 10 years in prison and a fine of up to $250,000. The FBI, HHS-OIG, and MFCU investigated.

SENTENCING – Yousef Hendi, 26
On Nov. 1, Yousef Hendi was sentenced to 40 years’ imprisonment after pleading guilty to multiple counts of sexual exploitation of children.  Hendi, a Palestinian national, coerced more than 34 minors, many of them inside the U.S., into sending sexually explicit images and videos. (Investigators have identified 19 of those victims thus far.) Hendi found a number of his victims by impersonating a female and joining an online, teen-only group, where he would challenge members to prove they were really female. Once Hendi had obtained a nude image of the minor, he would then threaten and coerce her into sending additional sexually explicit images and videos.  HSI conducted the investigation.

Attorney General Jeff Sessions today appointed U.S. Attorney for the Northern District of Texas Erin Nealy Cox – along with four other U.S. Attorneys, from New York, California, Alabama and Massachusetts – to serve on the Justice Department’s China Initiative combating economic espionage by Beijing.

This group is led by Assistant Attorney General for National Security John Demers and composed of five U.S. Attorneys and several other Department of Justice leaders, including senior FBI officials and Assistant Attorney General Brian Benczkowski of the Criminal Division.

The new initiative will aggressively pursue high-priority Chinese theft of trade secret and economic espionage cases.

“We cannot and will not allow foreign actors to take advantage of American ingenuity to line their own pockets,” said Nealy Cox. “I am proud to join this important effort and look forward to advancing the China initiative with my DOJ colleagues across the country.”

As the Attorney General noted at a press conference in Washington, DC this afternoon, despite China’s public commitment that it would not target American companies for economic gain, Chinese economic espionage against the United States has been rapidly increasing.

“Discoveries that took years of work and millions of dollars in investment here in the United States can be stolen by computer hackers or carried out the door by an employee in a matter of minutes,” Sessions said today. “Enough is enough.” 

Initiative Goals:

•  Identify priority trade secret theft cases, ensure that investigations are adequately resourced, and work to bring them to fruition in a timely manner

•  Develop an enforcement strategy concerning non-traditional collectors (e.g., researchers in labs, universities, and the defense industrial base) that are being coopted into transferring technology contrary to U.S. interests

•  Educate colleges and universities about potential threats to academic freedom and open discourse from influence efforts on campus

•  Apply the Foreign Agents Registration Act to unregistered agents seeking to advance China’s political agenda, bringing enforcement actions when appropriate

•  Equip the nation’s U.S. Attorneys with intelligence and materials they can use to raise awareness of these threats within their Districts and support their outreach efforts

•  Implement the Foreign Investment Risk Review Modernization Act (FIRMA) for DOJ (including by working with Treasury to develop regulations under the statute and prepare for increased workflow)

•  Identify opportunities to better address supply chain threats, especially ones impacting the telecommunications sector, prior to the transition to 5G networks

•  Identify Foreign Corrupt Practices Act (FCPA) cases involving Chinese companies that compete with American businesses

•  Increase efforts to improve Chinese responses to requests under the Mutual Legal Assistance Agreement (MLAA) with the United States

•  Evaluate whether additional legislative and administrative authorities are required to protect our national assets from foreign economic aggression

US Attorneys in Working Group:

•  Erin Nealy Cox (Northern District of Texas)

•  Richard P. Donoghue (Eastern District of New York)

•  Andrew E. Lelling (District of Massachusetts)

•  Jay E. Town (Northern District of Alabama)

•  Alex G. Tse (Northern District of California)

Thirty four year-old Lonta Hobbs, the final defendant associated with a July 2018 drug bust that netted 25 defendants in Wichita Falls, has pleaded guilty, announced U.S. Attorney for the Northern District of Texas Erin Nealy Cox.

One defendant, Chmira Denise Williams, pleaded guilty to misprision of a felony.

The remaining 24 defendants associated with the bust pleaded guilty to conspiracy to possess with intent to distribute methamphetamine:

•          Floyd Raymond Richardson

•          Wayland Brent Ballard

•          Brad Deshaun White 

•          Christopher Davis

•          Virginia Ann White

•          Trevor Clifford Scott *

•          Teasie Winnell Scott

•          Terry Lamar Murray

•          John Dupree Wesley

•          Javaris Damon Scott *

•          Djuanna Kyvon Newman

•          Chadrick Deshawn McBride

•          Galvin Lamar Daniels

•          Demarcus Madison

•          Shelby Breanna Funk

•          Christian Joseph Chavez

•          Adam Domingo Garcia

•          Lonta Hobbs

•          Candace Rebecca Williams

•          Aaron Floyd Taylor

•          Jacinda Renee Burris

•          Addis Scales

•          Alvin Gerald Travis

•          Amber Dawn Hatcher

Denene Griggs, 24, also pleaded guilty yesterday to concealing a person from arrest. She admits to sheltering two fugitives from the drug bust – her child’s father, Javaris Damon Scott, and his brother, Trevor Clifford Scott – inside her apartment.  (The Scott brothers had been on the run after authorities uncovered their role in the drug conspiracy.  They were arrested on September 6, 2018, when FBI and Wichita Falls Police Department investigators caught them climbing out the window of Griggs' Wichita Falls apartment.)

“As the U.S. Attorney, I lead an office that prosecutes a variety of very important federal cases, but few investigations are more important than those that protect the public from the danger and devastation caused by illegal drug trafficking,” Nealy Cox said at a press conference in Wichita Falls on July 12, following the bust.

The Federal Bureau of Investigation, Wichita Falls Police Department, Texas Department of Public Safety, Wichita County Sherriff’s Office, Vernon Police Department, 46th Judicial District Attorney’s Office, and the U.S. Marshals Service conducted the investigation.  Assistant U.S. Attorney Shawn Smith is prosecuting the case.

PLEA – Larry Duncan, 72
On Oct. 22, four-term Dallas City Councilman Larry Duncan, a former president of Dallas County Schools’ Board of Trustees, pleaded guilty to one count of tax evasion. The charge stems from the federal investigation into the Dallas County Schools bribery scandal, which claimed its fifth conviction Monday. Press release here.

INDICTMENT* – Jeffrey Richie, 53, & Wendy Richie, 58
On Oct. 23, a federal grand jury indicted a Red Oak, Texas couple who allegedly embezzled $14.5 million from retirement plans they managed. Jeffrey Richie, 53, and Wendy Richie, 58, co-owners of Vantage Benefits Administrators, were charged with conspiracy, theft from an employee benefit plan, wire fraud, and aggravated identify theft after they allegedly misappropriated funds from at least 1,000 participants in at least 20 employer’s plans.  Press release here. 

INDICTMENT* – Michelle North, 53
On Oct. 23, a federal grand jury indicted Michelle North, of Balch Springs, for theft of government funds and making false statement to the Social Security Administration (SSA).  She allegedly received income-based disability payments from SSA while also receiving a large amount of Indian tribal funds.  Ms. North failed to accurately tell SSA how much money she was receiving from the Tribal Counsel.  If convicted on this case, Ms. North will have to pay back approximately $32,000 in restitution.  SSA Office of the Inspector General investigated the case.

PLEA – Chris Faulkner, 41
On Oct. 23, Texas oil-and-gas mogul Christopher A. Faulkner pleaded guilty to securities fraud, engaging in illegal monetary transactions, and tax evasion. A frequent media commentator and self-proclaimed “frack master,” Faulkner admits he bilked investors out of millions of dollars and concealed millions more from the IRS. He now faces 12 years in prison. The IRS-CI, FBI, and U.S. Postal Inspection Service investigated. Press release here.

SENTENCING – Bill Day, 39 & Laura Day, 47
On Oct. 23, Bill and Laura Day, of Seymour, Texas were both sentenced in Wichita Falls federal court to 30 years in prison for child sexual exploitation. The husband and wife duo admitted to producing sexually explicit images involving an infant in 2015. The images were discovered while the Department of Public Safety was conducting a child pornography investigation of the Days in May 2017.  DPS and HSI conducted the investigation. 

SENTENCING – Miller Hogan, 44
On Oct. 24, Miller Hogan was sentenced to nearly 4 years in federal prison for his role in a cocaine distribution conspiracy.  In March, Hogan pled guilty to one count of conspiracy to possess with the intent to distribute, after Dallas Drug Enforcement Administration agents intercepted him on a wiretap negotiating and purchasing 1.5 kilograms of cocaine from a codefendant. 

SENTENCING – Mohammed Natour, 33
On Oct. 24, Mohammed Natour was sentenced to more than 12 years in federal prison for his role in a RICO conspiracy.  In March, Natour pled guilty for his participation in a transnational criminal enterprise, comprised mostly of Colombian nationals or individuals of Colombian descent, whose members targeted and robbed traveling diamond and jewelry salesmen across the United States.  Natour participated in four armed robberies of traveling diamond and jewelry salesmen over a one-year period, between 2014 and 2015, in Oklahoma, Texas, and Florida.

SENTENCING – Glenn Eugene Halfin, 64
On Oct. 24, a 64-year-old Grapevine, man was sentenced to 12 months in federal prison for a hate crime after he repeatedly threatened an African American family living in the apartment above him because of their race. Glenn Eugene Halfin admits he hung a baby doll dangling from a noose around a railing in their apartment complex. He pleaded guilty to interfering with housing rights. The FBI and Grapevine Police Department, in conjunction with the Tarrant County District Attorney’s Office, investigated. Press release here.

SENTENCING – Horacio Alpizar, 58
On Oct. 24, Horacio Alpizar was sentenced to 5 years in federal prison for his role in a cocaine distribution conspiracy. In April, Alpizar pled guilty to one count of conspiracy to possess with the intent to distribute, after Dallas Drug Enforcement Administration agents found $186,681 of drug proceeds in his home along with drug paraphernalia.  In a separate residence, DEA agents found a firearm, drug paraphernalia, cocaine, and a garage set up as a mechanic shop to load and unload vehicles with drugs and drug proceeds.  As part of his punishment, Alpizar was ordered to forfeit the cash, firearm, two vehicles, and three properties, all totaling nearly one million dollars.

PLEA – Denene Griggs, 24
On Oct. 25, Denene Griggs of Wichita Falls pleaded guilty to concealing a person from arrest. She admits to sheltering two fugitives – her child’s father, Javaris Damon Scott, and his brother, Trevor Scott -- inside her apartment. The Scott brothers, wanted in connection with a July 12 drug bust, were arrested Sept. 6, when officers spotted them climbing out of Grigg’s window. She now faces up to 5 years in prison. The FBI, DEA, DPS – Criminal Investigation Division, Wichita Falls PD, Rhome PD, and Iowa Parks PD investigated.

* An indictment is a formal accusation of criminal conduct, not evidence. A defendant is presumed innocent unless convicted through due process of law.

A  64-year-old Grapevine, Texas, man was sentenced today to 12 months in federal prison for a hate crime, announced U.S. Attorney for the Northern District of Texas Erin Nealy Cox and Acting Assistant Attorney General John Gore of the Justice Department’s Civil Rights Division.

In July, Glenn Eugene Halfin pleaded guilty to interfering with housing rights after he repeatedly threatened and intimidated an African American family living in the apartment above him because of their race.

In court documents, Mr. Halfin admits that in December 2017, he purchased a baby doll at Walmart, fashioned a rope into a noose, and slipped the noose around the baby doll’s neck. He then hung the noose from the railing directly in front of the staircase the victims used to access their apartment.

The defendant “recognized that this display would be particularly intimidating for the African-American victims who had a young daughter,” documents say. 

 “No family should be afraid for children in their own home,” said U.S. Attorney Nealy Cox. “The Northern District of Texas will not tolerate crimes born of bigotry. Prosecuting those that persecute others based on race is a priority for my office.” 

“The Justice Department will not tolerate unlawful acts of racial intimidation,” said Acting Assistant Attorney General Gore. “We will continue to prosecute hate crime offenders like Halfin to ensure that all families can feel safe in their own homes, regardless of their race, religion, or national origin.”

The Federal Bureau of Investigation and the Grapevine Police Department, in conjunction with the Tarrant County District Attorney’s Office, conducted the investigation. Trial Attorney Rebekah Bailey of the Civil Rights Division’s Criminal Section and Assistant U.S. Attorney Nicole Dana prosecuted the case.

A federal grand jury indicted a Red Oak, Texas couple who allegedly embezzled $14.5 million from retirement plans they managed, U.S. Attorney for the Northern District of Texas Erin Nealy Cox announced today.

Jeffrey Richie, 53, and Wendy Richie, 58, co-owners of Vantage Benefits Administrators, were charged with conspiracy, theft from an employee benefit plan, wire fraud, and aggravated identify theft.

According to the indictment, Vantage served as third party administrator for dozens of retirement funds, including several 401(k)s. With her husband’s knowledge, Ms. Richie -- posing as various beneficiaries -- allegedly submitted fraudulent distribution requests to the retirement fund custodian, Matrix Trust Co. Instead of depositing the money into beneficiaries’ accounts, however, she transferred it into Vantage’s operating account. The couple allegedly used those funds to pay Vantage payroll and other operating expenses, as well as personal expenses, including mortgage and escrow payments, farming equipment, and home décor.

The Richies misappropriated funds from at least 1,000 plan participants in at least 20 employer’s retirement plans, prosecutors say.

“This couple took advantage of innocent people who were working hard and saving for their future,” said Nealy Cox. “We cannot permit such brazen financial misconduct to go unchecked.”

“An important mission of the Office of Inspector General is to investigate allegations of fraud related to U.S. Department of Labor programs.  We will continue to work with DOL’s Employee Benefits Security Administration and our law enforcement partners to safeguard retirement benefits intended for American workers,” stated Steven Grell, Special Agent-in-Charge, Dallas Region, U.S. Department of Labor Office of Inspector General.

"Theft from pension funds violates the law and deprives plan participants of their hard-earned retirement benefits," said Deborah Perry, Employee Benefits Security Administration (EBSA) Regional Director, Dallas. "The U.S. Department of Labor will continue to aggressively investigate fiduciaries and others who misuse assets of private-sector benefit plans."

If convicted on all counts, the Richies face up to 81 years in federal prison.

An indictment is a formal accusation of criminal conduct, not evidence. A defendant is presumed innocent unless convicted through due process of law.

The Department of Labor – Office of Inspector General, the Federal Bureau of Investigation, the Department of Labor’s Employee Benefits Security Administration, and the Texas State Auditor’s Office conducted the investigation. Assistant U.S. Attorney Christopher Stokes is prosecuting the case.

Texas oil-and-gas mogul Christopher A. Faulkner has pleaded guilty to securities fraud, engaging in illegal monetary transactions, and tax evasion, U.S. Attorney for the Northern District of Texas Erin Nealy Cox announced today. 

A frequent media commentator and self-proclaimed “frack master,” Faulkner, 41, admits he bilked investors out of millions of dollars and concealed millions more from the IRS.

According to documents unsealed today, from 2011 to 2016, Faulkner raised more than $71 million from working interest investors, who took on a fixed portion of projected drilling costs in exchange for a share in his oil and gas profits.

But in marketing materials distributed to these investors, Faulkner inflated the estimated drilling cost by as much as 800 percent, allowing his three companies – Breitling Energy Corp., Crude Energy, LLC and Patriot Energy, Inc. – to pocket the difference between his projections and the actual cost of the wells.  

He also gave would-be investors a “Geology Report,” ostensibly prepared by an independent expert, estimating future production for each well. Unbeknownst to them, the report was generated by a geologist on Faulkner’s payroll, and consistently overstated the wells’ potential.

Faulkner routinely oversold shares, then transferred investment funds into comingled accounts, despite promising investors their money would be deposited in a segregated bank account used only to pay for drilling activities.

Over a  five-year period, he admits, he diverted approximately $23 million for his own personal benefit, shelling out hundreds of thousands of dollars at a time for luxury travel, professional concierge services, maintenance of multiple residences, and at least seven vehicles, including an Aston Martin, a Bentley, and a Mercedes Benz. During that time, his companies paid out just $6.2 million to investors, according to the criminal complaint filed in June.

“As Mr. Faulkner continued to deceive his investors about drilling expenses and potential oil well output, he spent their millions of investment dollars on his lavish lifestyle, ” said Nealy Cox. “Let this case send a message that this type of egregious investor fraud will be prosecuted to the fullest extent of the law.”

In 2014, Faulkner says, he concealed at least $4.5 million in taxable income from the federal government, failing to file a return or pay income tax.                                                  

Following an FBI raid on his offices in Dallas in April 2016, Faulkner was arrested in June 2018 at the Los Angeles International Airport, and later transported to Texas. He is currently in federal custody at FCI Seagoville, and now faces 12 years in prison and $350,000 in fines. According to the terms of his plea agreement, he will be required to pay restitution to those he defrauded.

Faulkner’s guilty plea comes on the heels of a civil settlement with the Securities & Exchange Commission (SEC), which filed a complaint in June 2016 alleging multiple violations of federal securities laws. Faulkner’s settlement with the SEC, which is subject to court approval, orders him to disgorge $23.8 million; permanently enjoins him from violating, among other things, the antifraud provisions of the federal securities laws and from participating in any unregistered securities transactions; and bars him from serving as an officer or director of any SEC-reporting company and from participating in any offering of a penny stock.

The Internal Revenue Service – Criminal Division, Federal Bureau of Investigation, and U.S. Postal Inspection Service conducted the criminal investigation; Assistant U.S. Attorneys Christopher Stokes, Katherine Miller, and Mark Tindall prosecuted the criminal case.

This morning, four-term Dallas City Councilman Larry Duncan, a former president of Dallas County Schools’ Board of Trustees, pleaded guilty to one count of tax evasion before Chief Judge Barbara M.G. Lynn, announced U.S. Attorney for the Northern District of Texas Erin Nealy Cox.  

The charge stems from the federal investigation into the Dallas County Schools bribery scandal, which has now claimed its fifth conviction.

According to plea papers, between 2012 and 2016, Mr. Duncan, 72, accepted nearly a quarter of a million dollars in campaign contributions from Force Multiplier Solutions president Robert Leonard, who happened to be pursuing lucrative stop-arm camera contracts with DCS.

Instead of putting Mr. Leonard’s money towards legitimate campaign expenses associated with his DCS re-election bid, Mr. Duncan admits he used at least $184,726.03 for personal benefit, taking out cash withdrawals, passing on money to his wife, and even using funds to pay car-related expenses.

He then failed to disclose the money he diverted from the campaign on his tax returns, hiding the income from the IRS. 

“Today marks another important step in our ongoing commitment to expose public corruption,” said Nealy Cox. “Those who seek to capitalize on positions of power undermine public trust in the very system they are meant to serve.  And that is something we cannot abide.”

“Being a public official comes with its share of rewards and responsibilities; part of those responsibilities is to report all of your taxable income and pay your taxes.  Deliberate failure to do so is a serious matter, and IRS Criminal Investigation is dedicated to ensuring everyone is properly reporting and paying in accordance with the tax laws,” said Tamera Cantu, Special Agent-in-Charge of the IRS Criminal Investigation Division’s Dallas Field Office.

“The FBI remains committed to investigating anyone associated with the financial exploitation at Dallas County Schools,” said Eric K. Jackson, Special Agent-In-Charge of the FBI Dallas Division. “This latest indictment continues the efforts of the FBI, along with our partners at the IRS and U.S. Attorney’s Office, to protect and defend Dallas taxpayers from those who would exploit their position for personal gain.”

Mr. Duncan now faces up to a year in federal prison. In his plea agreement, Mr. Duncan agreed to reimburse the government for its tax loss.

Duncan’s campaign contributor, Mr. Leonard, along with former Mayor Pro Tem Dwaine Caraway, pleaded guilty in August to conspiracy to commit honest services wire fraud, after the DCS investigation revealed that Mr. Leonard had funneled over $3 million in bribes to Caraway and Dallas County Schools Superintendent Ricky Sorrells. Mr. Sorrells pleaded guilty in April to conspiracy to commit honest services wire fraud. Another defendant, Slater Swartwood, who operated the shell companies used to conceal the bribes, admitted in December 2017 to conspiring to launder money.

Dallas County Schools, an agency that collected property taxes to fund its fleet of around 2,000 buses, was shuttered in November 2017, approximately $103 million in debt.

The Internal Revenue Service Criminal Investigation unit (IRS-CI) and Federal Bureau of Investigation conducted the investigation. Assistant U.S. Attorneys Andrew Wirmani, Marcus Busch, Chad Meacham, and Joseph Magliolo prosecuted the case.

 

A Dallas-area pimp who preyed on teenage girls was sentenced to life in prison this afternoon, announced U.S. Attorney for the Northern District of Texas Erin Nealy Cox.

Allen Nash, 31, was convicted in April of sex trafficking of children, conspiracy to commit sex trafficking, sex trafficking through force, fraud or coercion, transportation of a minor to engage in commercial sex acts, and illegal possession of ammunition after he forced two victims, aged 17 and 19, into the illicit sex trade in the fall of 2014.

During his four day trial, victims told jurors Nash lured them into engaging in commercial sex acts by promising a better life. Instead, he joined forces with the owner of the “Doll House” massage parlor, demanding the girls work day and night. He confiscated their proceeds and used violence and threats to keep them from leaving. 

When one victim dozed off in a motel room, Nash dragged her out of bed and slammed her head into a toilet, cracking the seat with her skull – a warning to other victims about what could happen to them if they failed to earn enough money.

Nash recruited the 17-year-old via Facebook, with promises of gifts and trips, evidence showed. One day, he showed up at her mother’s apartment in a Mercedes to drive her to a liaison.

“I was a vulnerable little girl in need of guidance. I was desperate for help. Allen Nash knew that,” the young woman, now 22, said in an impact statement read aloud in court today. “I think it’s safe to say the devil lives in him.”

Nash routinely uploaded profanity-laced videos of himself clutching fistfuls of dollar bills, boasting about “ho money,” prosecutors said.  He, Doll House owner Connie Su Moser, and manager Kum Shugars arranged illicit meetups on Backpage.com, thinly disguised as “body rub” treatments.

“Preying on vulnerable young women is despicable, and this sentence validates that important message,” said Nealy Cox. “I’m proud of the women who came forward to help us bring Mr. Nash to justice. We will continue to prioritize human trafficking cases across the Northern District of Texas.”

Ms. Moser, who pleaded guilty to racketeering and misprision of a felony in July 2017, had already been sentenced to 8 years in prison. Ms. Shugars, who testified at Nash’s trial, pleaded guilty to racketeering in June 2017, and was sentenced to just over 2 years in prison.  Authorities seized over a million dollars in assets from Ms. Moser, including more than $400,000 in cash from her home, $70,000 in her bank account, and her 2015 Lexus – all of which the court determined were proceeds from the trafficking operation.

The Department of Homeland Security, the Texas Department of Public Safety, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Shreveport Police Department and the Federal Bureau of Investigations’ Shreveport office conducted the investigation. Assistant U.S. Attorneys Cara Foos Pierce, Myria Boehm and OCDETF Section Chief Rick Calvert prosecuted the case.

PLEA – Kendell Jackson, 24
On Oct. 16, Kendell Jackson of Dallas pled guilty to bank robbery and firearm charges.  Jackson admitted that in January, he entered the BBVA Compass Bank on West Northwest Highway in Dallas with a .40 caliber handgun.  He used that gun to jeopardize the life of a bank teller so that he could steal several thousand dollars in U.S. currency.  Police apprehended Jackson nearby after a dye-pack exploded, forcing Jackson to stop at a Jack-in-the-Box to try to clean himself.  Both the money and the gun were recovered.  Jackson now faces a minimum of 7 years and up to life in prison as well as a fine of up to $250,000.  The FBI and the Dallas Police Department investigated.

PLEA – Valandus Gibson, 29
On Oct. 16, Valandus Javon Gibson of Chicago, IL, pleaded guilty to conspiracy to money laundering.  Gibson admitted to conspiring with others to conduct financial transactions involving no less than $209,000, which were the proceeds of unlawful activity (namely: wire fraud).  He now faces up to 20 years in prison and a fine of at least $500,000.  The United States Postal Service investigated the case.

SENTENCING – Olusola Akingbade, 55
On Oct. 17, Olusola Akingbade was sentenced to more than 5 years in federal prison and ordered to pay $2.5 million in restitution for his role in a Medicare home health care fraud. A jury convicted Akingbade on one count of conspiracy to commit health care fraud and three counts of health care fraud following a one-week trial in June 2017.  Akingbade, a registered nurse at Paradise Home Health, falsified patient files to make non-homebound patients appear qualified for services and facilitated the payment of cash kickbacks to patients.

SENTENCING – Alan Nash, 41
On Oct. 18, a Dallas-area pimp who preyed on teenage girls was sentenced to life in prison. Alan Nash was convicted in April of sex trafficking of children, conspiracy to commit sex trafficking, sex trafficking through force, fraud or coercion, transportation of a minor to engage in commercial sex acts, and illegal possession of ammunition after he forced two victims, aged 17 and 19, into the illicit sex trade in the fall of 2014.” I think it’s safe to say the devil lives in him,” a victim wrote in an impact statement read aloud in court at sentencing. Release here.

VERDICT – Marco Lopez, 25
On Oct. 19, a federal jury convicted Marco Lopez of engaging in a conspiracy to distribute cocaine in a case involving a failed drug deal turned shootout. During the trial, jury heard evidence that at the scene of a shooting on “Hideout Road” in rural Navarro County, authorities discovered a kilogram of cocaine, two handguns smeared with blood, and an abandoned duffel bag full of counterfeit cash.  They later identified Marco Lopez, who called 911 for a gunshot wound to his arm, on surveillance video buying a package of counterfeit pens. He faces up to 40 years in federal prison. The DEA, U.S. Marshal’s Service, and Navarro County Sheriff’s Office conducted the investigation.

PLEA -- Leslie Summitt, 53         
Leslie Eugene Summitt of Keene, Texas pleaded guilty to conspiring to possess with intent to distribute methamphetamine.  He now faces up to 20 years in prison and is set to be sentenced January 31, 2019.

SENTENCING -- Mia Vasquez, 44     
Mia Vasquez of Dallas, Texas, was sentenced to just over 3 years in federal prison after pleading guilty to conspiring to possess with intent to deliver 1 kilogram or more of heroin in late 2013 and early 2014. 

PLEA – Kendell Jackson, 24
On Oct. 16, Kendell Jackson of Dallas pled guilty to bank robbery and firearm charges.  Jackson admitted that in January, he entered the BBVA Compass Bank on West Northwest Highway in Dallas with a .40 caliber handgun.  He used that gun to jeopardize the life of a bank teller so that he could steal several thousand dollars in U.S. currency.  Police apprehended Jackson nearby after a dye-pack exploded, forcing Jackson to stop at a Jack-in-the-Box to try to clean himself.  Both the money and the gun were recovered.  Jackson now faces a minimum of 7 years and up to life in prison as well as a fine of up to $250,000.  The FBI and the Dallas Police Department investigated.

PLEA – Valandus Gibson, 29
On Oct. 16, Valandus Javon Gibson of Chicago, IL, pleaded guilty to conspiracy to money laundering.  Gibson admitted to conspiring with others to conduct financial transactions involving no less than $209,000, which were the proceeds of unlawful activity (namely: wire fraud).  He now faces up to 20 years in prison and a fine of at least $500,000.  The United States Postal Service investigated the case.

SENTENCING – Olusola Akingbade, 55
On Oct. 17, Olusola Akingbade was sentenced to more than 5 years in federal prison and ordered to pay $2.5 million in restitution for his role in a Medicare home health care fraud. A jury convicted Akingbade on one count of conspiracy to commit health care fraud and three counts of health care fraud following a one-week trial in June 2017.  Akingbade, a registered nurse at Paradise Home Health, falsified patient files to make non-homebound patients appear qualified for services and facilitated the payment of cash kickbacks to patients.

SENTENCING – Alan Nash, 41
On Oct. 18, a Dallas-area pimp who preyed on teenage girls was sentenced to life in prison. Alan Nash was convicted in April of sex trafficking of children, conspiracy to commit sex trafficking, sex trafficking through force, fraud or coercion, transportation of a minor to engage in commercial sex acts, and illegal possession of ammunition after he forced two victims, aged 17 and 19, into the illicit sex trade in the fall of 2014.” I think it’s safe to say the devil lives in him,” a victim wrote in an impact statement read aloud in court at sentencing. Release here.

VERDICT – Marco Lopez, 25
On Oct. 19, a federal jury convicted Marco Lopez of engaging in a conspiracy to distribute cocaine in a case involving a failed drug deal turned shootout. During the trial, jury heard evidence that at the scene of a shooting on “Hideout Road” in rural Navarro County, authorities discovered a kilogram of cocaine, two handguns smeared with blood, and an abandoned duffel bag full of counterfeit cash.  They later identified Marco Lopez, who called 911 for a gunshot wound to his arm, on surveillance video buying a package of counterfeit pens. He faces up to 40 years in federal prison. The DEA, U.S. Marshal’s Service, and Navarro County Sheriff’s Office conducted the investigation.

PLEA -- Leslie Summitt, 53         
Leslie Eugene Summitt of Keene, Texas pleaded guilty to conspiring to possess with intent to distribute methamphetamine.  He now faces up to 20 years in prison and is set to be sentenced January 31, 2019.

SENTENCING -- Mia Vasquez, 44     
Mia Vasquez of Dallas, Texas, was sentenced to just over 3 years in federal prison after pleading guilty to conspiring to possess with intent to deliver 1 kilogram or more of heroin in late 2013 and early 2014. 

U.S. Attorney Erin Nealy Cox is pleased to announce the appointment of three new Assistant United States Attorneys: Jon Bradshaw, assigned to the Dallas Appellate Division, Levi Thomas, assigned to the Fort Worth Criminal Division, and Linda Requenez, assigned to the Dallas Criminal Division’s Narcotics & OCDETF section.

All three prosecutors were sworn in on October 15 before Chief U.S. District Judge Barbara M.G. Lynn.

A graduate of Texas A&M University and the University of Denver Sturm College of Law, Mr. Bradshaw joins the U.S. Attorney’s Office from the United States District Court of the Northern District of Texas, where he served as a Staff Attorney focusing on the habeas docket. He also worked as an Attorney at the United States Court of Appeals for the Third Circuit. Mr. Bradshaw’s father was a police officer for 39 years; his son shares his father’s dedication to law enforcement and public service.

Mr. Thomas, who will focus on immigration cases, formerly served as an Attorney at the U.S. Department of Homeland Security’s Immigration and Customs Enforcement (ICE) division. Before that, he served as a Law Clerk for the U.S. Court of Appeals for the Fifth Circuit under the Honorable Catharina Haynes, and for the U.S. District Court for the Eastern District of Texas under the Honorable Zack Hawthorn. He earned his undergraduate degree from Texas A&M University and his J.D. from New York University School of Law.

An alumna of  the University of Texas and  Texas Southern University’s Thurgood Marshall School of Law, Ms. Requenez returns to the Northern District of Texas from the Southern District of Texas, where she prosecuted a range of violent crimes. During a previous stint in Dallas, she served as an AUSA here at the U.S. Attorney’s Office and as an Assistant Criminal District Attorney for Dallas County Criminal District Attorney’s Office.

“I’m proud to have these excellent attorneys on our teams in Dallas and Fort Worth,” said Nealy Cox. “I know they will fight for justice in North Texas.”

As the National “Project Safe Neighborhoods” Initiative celebrates its one-year anniversary today, U.S. Attorney Erin Nealy Cox is proud to announce that the Dallas PSN Taskforce has executed its 100th arrest.

Fifty of these violent criminals have been charged in federal court, and dozens more face charges filed by the Dallas County District Attorney’s Office.  

Dubbed “Operation Badge #10934” in honor of fallen DPD Officer Rogelio Santander, Dallas PSN was launched in February 2018 to tackle increasing violent crime.

Led by U.S. Attorney Nealy Cox and Dallas Police Chief Renee Hall, the PSN Taskforce -- a coalition of federal and local law enforcement that includes FBI, ATF, DEA, and the U.S. Marshals Service -- worked with TCU criminologists to analyze district-wide violent crime data. They zeroed in on a violent crime “hotspot,” a diverse community of around 98,000 people nestled at the intersection of Route 75 and LBJ Freeway. Home to densely-packed apartment complexes housing a significant refugee community, the neighborhood has a $41,883 median household income, a median age of just over 30, and more than 21,000 kids under the age of 14. 

The PSN Taskforce believed the neighborhood, which suffers more than 15 homicides on average each year and ranks high in aggravated assaults and robberies, could benefit from a three-pronged approach, combining traditional enforcement, community outreach, and recidivism reduction.  

Underscoring PSN Dallas’ momentum, the Justice Department this week awarded the Northern District of Texas more than $700,000 to fund PSN efforts in 2019.

Prong 1: Law Enforcement 
PSN’s message to bad actors who set up shop in the hotspot is simple: We will not ignore violent crime in this community, and we will use every tool at our disposal to combat it.  

A group of more than 60 PSN taskforce officers and agents -- from the Dallas Police Department, FBI – Dallas Division, DEA, ATF, U.S. Marshals, Dallas Sheriff’s Office, Dallas District Attorney’s Office, DISD, and DART -- come together every week to review arrests and identify trends.

PSN AUSAs have charged dozens of individuals with federal felonies, ranging from carjacking to straw purchasing.  Cases include:

• Keon Dwayne Thompson, Meco Deere, and Girtha Johnson, charged with kidnapping an individual known as “M.M.” in an effort to obtain money.
• Michael McConico, charged with felon in possession of a firearm after he was caught on surveillance camera shooting a 9mm handgun at an unknown victim behind a “Family Dollar” store. (VIDEO FOOTAGE of the shooting available upon request.)
• Aaron David Stallworth, aka “Ace,” charged with attempted carjacking after he used violence and intimidation to attempt to steal a 2010 Chevrolet Traverse.
• Demoushae and Tashonna Marsh, the straw purchasers of a gun later used to murder an innocent man, charged with acquiring a firearm by false statements after they purchased two 9mm Glock pistols from Academy Sports + Outdoors.

Prong 2: Community Outreach
Central to PSN’s mission is holding violent offenders accountable, but even the best law enforcement officers need the help – and trust – of crime victims and witnesses. PSN works to foster strong bonds between law enforcement and the PSN neighborhood’s burgeoning immigrant community.

To that end, the taskforce translated educational materials into eight languages, then posted information cards detailing PSN goals and tip-line contacts at local retailers. The team reiterated the message at more than 45 community events with neighborhood groups, apartment managers, and local business organizations, where they spoke about the vision for a safer neighborhood and how residents could help achieve it.

As part of a project nicknamed “Operation Greenlight,” they encouraged locals to install security cameras at key intersections. And next month, the PSN taskforce will begin gang prevention sessions at high schools inside the hotspot.

PSN’s outreach has already yielded tangible results, including collaboration with residents leading to the arrests of several violent offenders.

In August, the U.S. Attorney’s Office celebrated these strides by hosting over 1,000 guests at the first annual Community Unity Festival at Tasby Middle School. While adults munched on complementary “Back the Blue” DPD BBQ and surveyed the job fair and wellness screenings, their kids peeked into the DEA chopper, crawled inside the FBI SWAT vehicle, donned tactical gear, and shot hoops with law enforcement officers. (PHOTOS available.)

Prong 3: Recidivism Reduction
Much of the PSN area crime is perpetrated by recidivists previously convicted of state and local offenses. PSN seeks to offer men and women recently released from prison or entering probation an alternative.

One night a month, the taskforce hosts a mandatory Reentry Night, outlining ramifications of re-offending and presenting a buffet of resources, from job placement programs to counseling opportunities.

The sessions, typically attended by 300 people or more, strike a positive note, including video vignettes with testimony from former felons. In surveys distributed at the close of the session, 96% of attendees rated the program “helpful” in their reentry journey.

Our Goal
Following two years of alarming increases in 2015 and 2016, thankfully, statistics nationwide show a small but encouraging dip in violent crime in 2017. The U.S. Attorney is confident that working together, the PSN’s three-pronged approach will spark a similar downswing in violent crime in  Dallas, creating safer neighborhoods across the metroplex. 

“I’m so proud of the way our local and federal law enforcement have come together to build relationships with the community and foster lasting change in a neighborhood that’s long been plagued by crime,” said U.S. Attorney Nealy Cox. “I’m confident this data-driven, comprehensive strategy can have a real impact. This community deserves nothing less.”  

“We are truly excited about the success of Project Safe Neighborhood. This is community policing partnerships at its best. Since its inception, we’ve seen an overall reduction in crime of 6.43 percent,” added Dallas Police Chief Reneé Hall. “This dynamic initiative allows the Dallas Police Department’s PSN team to collaborate weekly on strategies to identify and target enforcement.  The Dallas community is a safer area to live, work and play.”

“Creating a safe environment for Dallas citizens, with the assistance of law enforcement at every level, is a noble undertaking,” said Eric K. Jackson, FBI Special Agent in Charge of the Dallas Division. “The FBI supports PSN, and will be a part of making the City of Dallas safer for future generations.”

“DEA is proud to work in conjunction with the United States Attorney’s Office for the Northern District of Texas as well as numerous other federal, state and local law enforcement entities to combat violent crime as part of the Project Safe Neighborhood Initiative,” stated DEA Dallas Field Office Special Agent In Charge Clyde E. Shelly. “The partnership embodies the DEA motto, ‘Tough work, vital mission.’”

“ATF, our law enforcement partners and the strategic application of intelligence and resources have removed firearms and violent offenders from this community plagued by crime,” stated ATF Special Agent in Charge of the Dallas Division Jeffrey C. Boshek II. “I am confident the immediate impact is positive, and look forward to realizing the results of strategies beyond crime reduction. ATF remains committed to Project Safe Neighborhoods, the public, schools and businesses we serve through civic events, social media and crime prevention efforts designed to keep communities safe and thriving.”

“The U.S. Marshals Service, along with our federal, state, and local partners, is committed to the reduction of crime in our local neighborhoods,” said U.S. Marshal for the Northern District of Texas Richard Taylor. “While the USMS remains dedicated to locating and apprehending the most violent offenders, this partnership presents the opportunity to reach out to the community to help prevent crime.”

“Project Safe Neighborhoods is a proven program with demonstrated results,” Attorney General Jeff Sessions said. “I have empowered our United States Attorneys to focus enforcement efforts against the most violent criminals in their districts, and directed that they work together with federal, state, local, and tribal law enforcement and community partners to develop tailored solutions to the unique violent crime problems they face.” 

 

A Mesquite-based bariatric surgeon today formally admitted his role in the $200 million Forest Park Medical Center fraud, announced U.S. Attorney for the Northern District of Texas Erin Nealy Cox.

53-year-old Wade Neal Barker, one of Forest Park’s founding doctors, appeared in court this morning, where he pleaded guilty to conspiracy to pay and receive healthcare bribes and kickbacks as well as aiding and abetting commercial bribery.

“Patients trust doctors to make healthcare recommendations based on their best interests,” said Nealy Cox. “Instead, Dr. Barker let his own financial considerations guide decisions about where patients would be treated – and, in the process, defrauded millions from patients’ insurance.  The Northern District of Texas will not tolerate plots that undermine confidence in the healthcare system.”

“With the plea in this conspiracy to defraud patients and the healthcare industry by those entrusted to administer and to protect it, the FBI and our law enforcement and regulatory partners will increase our efforts to shine even brighter lights on such schemes to restore the missing trust for all those harmed by the conspirator's actions,” said Eric Jackson, Special Agent-In-Charge of the FBI Dallas Division.

Barker is the seventh of 21 defendants to formally plead guilty in the bribery scheme, designed to induce doctors to refer lucrative patients – particularly those with high-reimbursing, out-of-network private insurance – to the now-defunct hospital, as opposed to other facilities.

Instead of billing patients for out-of-network co-payments, instituted by insurers to de-incentivize the high costs associated with out-of-network treatment, Forest Park allegedly assured patients they would pay in-network prices. Because they knew insurers wouldn’t tolerate such practices, they concealed the patient discounts and wrote off the difference as uncollected “bad debt.”

According to prosecutors, Barker and his co-conspirators shelled out approximately $40 million in bribes, disguised as “marketing money” and funneled through a shell company, between 2009 and 2013.  Because he performed surgeries at Forest Park, Barker received these so-called “marketing” payments as well.

He faces roughly five to seven years in federal prison. Sentencing has not yet been set.

Co-defendants Richard Ferdinand Toussaint, Jr., another Forest Park Founder, and Alan Andrew Beauchamp, the hospital manager, have pleaded guilty in the case, along with several others. The remaining defendants are awaiting trial early next year.

The case was investigated by the Federal Bureau of Investigation, the U.S. Department of Labor Office of Inspector General, the U.S. Department of Labor Employee Benefits Security Administration, the U.S. Department of Defense - Defense Criminal Investigative Service, the U.S. Office of Personnel Management Office of Inspector General, and Internal Revenue Service Criminal Investigation, with assistance from the Food and Drug Administration and the U.S. Postal Inspection Service.

Assistant U.S. Attorneys Andrew Wirmani, Kate Pfeifle and Mark Tindall are prosecuting the case.

A 40-year-old Lubbock high school teacher has been charged with enticement and attempted enticement of his 16-year-old female student, U.S. Attorney Erin Nealy Cox announced today. 

According to a criminal complaint filed in federal court, Scott Riley Hall, an art teacher at Coronado High School, allegedly engaged in sexual intercourse with a 10th grade girl at her home in August.  

The relationship allegedly began last summer, after the victim confided in Hall about a difficult situation she’d encountered at school the previous year. In September, the victim’s mother stumbled upon some sexually explicit emails they’d shared: 

“I love touching you,” Hall wrote in one email. “One of these days, we are going to spend hours watching movies and rolling around in bed.”

“Seeing you (even briefly), dreaming of the next time, and reminiscing about the last time. These things make me sad, too, but they help me cope until we are just together.  Always,” he wrote in another. 

“I do hope you rested well and that you felt better than hating our situation,” he said in a third. “I’ll see you at school soon.  I love you my dear.”

After the victim admitted to her mother that she’d had sex with Hall, the mother confronted the teacher. 

“I am not sure of what you believe has happened, but my fault was caring too much in the wrong way,” Hall admitted to the mother in a follow-up text. “I will agree to any measure you would like me to take I [sic] regards to distancing myself… I am so sorry to have hurt either of you.” 

“I truly wanted to be that Art Dad, but I let my care for her cross a line.  It was a huge mistake,” he continued. “It was misguided affection. I am very sorry.  I will do anything you ask to keep this from being a legal or professional situation.” 

“I am not a predator,” Hall said.  

Hall later told police that he’d developed “strong feelings” for the 16-year-old girl, and agreed their interactions were “inappropriate.” Confronted with numerous email and text conversations, he admitted his communications with the victim were sexual in nature.  

A criminal charge is merely an allegation, and the defendant is presumed innocent until proven guilty in a court of law.  If convicted, Hall faces up to life in federal prison. He’s also facing charges in state court. 

The Federal Bureau of Investigation’s Dallas Field Division, the Lubbock Police Department, and the Lubbock Independent School District Police Department conducted the investigation; Assistant U.S. Attorney Jeff Haag is prosecuting the federal case. 

U.S. Attorney Erin Nealy Cox joins the Department of Justice in announcing more than $70 million in grant funding to bolster school security, educate and train students and faculty, and support law enforcement officers and first responders who arrive on the scene of a school violence incident – including more than a million dollars in grants for several awardees operating in the Northern District of Texas.

Grants to entities in NDTX include:

• $500,000 to Tarrant County (STOP Prevention grant)
• $499,997 to the City of Arlington (COPS grant)
• $249,992 to Amarillo ISD (STOP Prevention grant)
• $80,000 to O’Donnell ISD (STOP Prevention grant)
• $15,885 to the City of Benbrook (COPS grant)
• $1 million to the statewide Texas Education Agency (STOP Threat Assessment grant)

“President Trump and his administration will ensure the safety of every American school," Attorney General Jeff Sessions said. "Earlier this year he signed into law the STOP School Violence Act, which provides grant funding to develop anonymous school threat reporting systems, to implement school building security measures, and to train students, school personnel, and law enforcement on how to prevent school violence. Today I am announcing $70 million in these grants to hundreds of cities and states across America. These grants will go a long way toward giving young people and their families both safety and peace of mind.”

“As the chief federal law enforcement officer in North Texas  -- and mother of three students –  few things are as important to me as the safety and security of our school children,” said Nealy Cox. “This significant investment by the Justice Department will go a long way to ensure the safety of students and educators in the Northern District of Texas”   

The Office of Justice Program’s Bureau of Justice Assistance (BJA) and the Office of Community Oriented Policing Services (COPS Office) together are making more than 220 awards to jurisdictions across the country to help make schools more secure. The awards, granted through three funding streams, will provide new technology for reporting systems and other threat deterrent measures and create school safety training and education programs for school administrators, staff, students, and first responders. This includes the support for existing crisis intervention teams and the creation of new ones.

• BJA’s STOP School Violence Threat Assessment and Technology Reporting Program will provide 68 awards valued at more than $19 million. This funding supports training to create and operate threat assessment and crisis intervention teams and to develop technology for local or regional anonymous reporting systems. This technology may be in the form of a mobile phone application, hotline, or website.
• The STOP School Violence Prevention and Mental Health Training Program, also managed by BJA, will provide training and education on preventing violence and effectively responding to related mental health crises. This program will fund 85 awards at nearly $28 million.
• The COPS Office School Violence Prevention Program (SVPP) will provide nearly $25 million to 91 jurisdictions for school safety measures including coordination with law enforcement, training for law enforcement to prevent student violence against others and self, target hardening measures, and technology for expedited notification of law enforcement during an emergency.

The grants are authorized by the STOP School Violence Act, which are intended to improve school security by helping students and teachers reduce exposure to risks, prevent acts of violence, and quickly recognize and respond to violent attacks.

The Department also announced that it has awarded more than $64 million to state agencies to improve the completeness, quality, and accessibility of the nation’s criminal record systems. These grants are administered by the Bureau of Justice Statistics, part of OJP. Approximately $43 million in funding will be administered through the National Criminal History Improvement Program (NCHIP), and nearly $21 million will be awarded under the National Instant Criminal Background Check System (NICS) Act Record Improvement Program.  These grant programs help states automate and upgrade records accessed by the firearms background check system.  This year, at the direction of the Attorney General, the Department prioritized funding for projects that improve accessibility of criminal history records, domestic violence convictions, and information on persons who are prohibited from possessing firearms for mental-health related reasons.

The Department is also investing over $1 million in research to better understand the factors behind mass shooting incidents. The grant awards, made by the Department’s National Institute of Justice (NIJ), part of OJP, support scientific investigations that will examine factors that contribute to mass violence, identify any patterns in mass shootings, analyze psychological and social life histories of mass shooters and community-level predictors of mass violence, and will examine firearm purchasing patterns of known mass shooters in order to create a risk prediction tool.  

INDICTMENT* – James Maraia, 70
On Sept. 25, a federal grand jury indicted James Lawrence Maraia of Cedar Hill on child pornography charges.  He allegedly used a peer-to-peer computer program to share and collect child pornography over a five year period.  If convicted, Mr. Maraia faces up to 20 years for each count.  The FBI investigated.

INDICTMENT* - Larry Rider & Kevin Harris

On September 25, in two seperate cases, a federal jury indicted Larry Rider and Kevin Harris, both Dallas residents, for felon in possession of a firearm.   If convicted, both men face up to 10 years in federal prison.  The  Dallas Police Department and FBI investigated the case. 

INDICTMENT* – David Stallworth, 36
On Sept. 26, a federal grand jury indicted Aaron David Stallworth, aka “Ace,” for attempted carjacking. He allegedly used violence and intimidation to steal a 2010 Chevrolet Traverse. If convicted, Mr. Stallworth faces up to 45 years in federal prison. This case was brought as part of the U.S. Attorney’s Project Safe Neighborhood initiative, which brings together federal and local law enforcement to target the community’s most pressing crime problems. The Texas Rangers investigated.

INDICTMENT* – Jesus Gonzales, 18
On Sept. 26, a federal grand jury indicted Jesus Antonio Gonzalez of Irving on drug trafficking and firearms charges. On August 20, Mr. Gonzales -- who was allegedly dealing cocaine and marijuana out of a Park Square apartment -- fired an AR-15 during his trafficking.  Four days later, he was discovered carrying an AK-47 while engaged in drug trafficking. If convicted, Mr. Gonzalez faces up to life in federal prison.  The Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF) and the Irving Police Department investigated the case.

PLEA – Madison Brekke, 21
On Sept. 27, Madison Elizabeth Brekke of Coppell plead guilty to possession of a firearm by an unlawful user of a controlled substance. An admitted addict, Ms. Brekke confirms that in early August, she was using heroin, a Schedule I controlled substance. At that time, she admitted, she possessed a Sig Sauer SP2022 handgun. She now faces up to 10 years in federal prison and a $250,000 fine. The Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF) and the Coppell Police Department investigated.

PLEA – Kenntorro Armstrong, 24
On Sept. 27, Kenntorro Armstrong of Fort Worth pleaded guilty to delay or destruction of mail.  Armstrong admits that while a postal employee, he detained a first-class envelope addressed to a customer in Fort Worth. He now faces up to 5 years in prison and a fine of up to $250,000. The USPS - Office of Inspector General investigated.

* An indictment is a formal accusation of criminal conduct, not evidence. A defendant is presumed innocent unless convicted through due process of law.

U.S. Attorney Erin Nealy Cox today announced the appointment of five new Assistant United States Attorneys: Stephen Rancourt, assigned to the Lubbock Criminal Division; Melanie Smith, assigned to the Dallas Criminal Division’s Violent and Major Crimes Section; Damien Diggs, also assigned to the Dallas Criminal Division’s Violent Crimes Section; Braden Civins, assigned to the Dallas Civil Division; and Abe McGlothin, assigned to the Dallas Criminal Division’s Violent and Major Crimes Section.

All five prosecutors were sworn in Monday morning before Chief U.S. District Judge Barbara M.G. Lynn.

A two-time graduate of the University of Richmond, Mr. Rancourt joins Nealy Cox’s prosecutorial team from the District Attorney’s Office in Wichita County, where he spent six years as an Assistant District Attorney, rising to become First Assistant ADA.

Ms. Smith, an alumnus of Gonzaga University and the University of Virginia School of Law, is happy to be returning to the same district where she clerked for former U.S. District Judge Jorge A. Solis six years ago. In the intervening years, she served in the Department of Justice’s Tax Division in Washington, DC.  

Mr. Diggs joins the Northern District of Texas from the U.S. Attorney’s Office in DC, where he prosecuted homicides and other criminal cases; before that, he worked for the U.S. Department of Education’s Office for Civil Rights. Mr. Diggs earned his undergraduate degree from Towson University and his law degree from American University’s Washington College of Law.

An alumnus of Emory University and the University of Texas School of Law, Mr. Civins previously served as Assistant Attorney General at the Texas Attorney General’s Office’s Civil Medicaid Fraud Division, where he handled complex civil litigation under the Texas Medicaid Fraud Prevention Act.

Mr. McGlothin joins Northern District from the U.S. Attorney’s Office the Southern District of Mississippi, where he prosecuted a wide range of violent crimes and served as the Project Safe Neighborhood Coordinator. He earned his degrees at Jackson State University and the University of Mississippi School of Law.

“I am thrilled to welcome these five exceptional attorneys to the Northern District of Texas today,” said Nealy Cox. “I’m confident they will bring honor to the important work this office does day in and day out.”

PLEA – Joe Frank Rodriguez, Jr., 46
On Sept. 17, Joe Frank Rodriguez, Jr. of Plainview, Texas, pleaded guilty to embezzlement by a bank employee.  Rodriguez admits to embezzling $143,000 from a Texas bank insured by the Federal Deposit Insurance Corporation (FDIC).  He now faces up to 30 years in prison and a fine of $1,000,000. The FBI conducted the investigation.

SENTENCING – Jose Bryan Gonzalez, 19
On Sept. 18, Jose Bryan Gonzalez of Dallas, Texas, was sentenced to 2 ½ years in federal prison for his role in illegal firearms smuggling.  In May, Gonzalez pleaded guilty to one count of possessing a firearm while under felony indictment following an investigation by the Bureau of Alcohol, Tobacco, Firearms, & Explosives (ATF) that revealed Gonzalez had bought, through an unindicted coconspirator, over 40 firearms, which the government believes were destined for Mexico.  

SENTENCING – Chase Matheny, 35
On Sept. 18, Chase Matheny of Fort Worth, Texas was sentenced to 2 ½ years in federal prison for possession of stolen mail.  In May, Matheny pled guilty to one count of possession of stolen mail after a Bedford Police officer discovered him with a backpack containing various stolen letters.

PLEA – Serafin Sanchez Ruiz, 29
On Sept. 19, Serafin Sanchez Ruiz of Desoto, TX -- a former CareNow nurse -- pleaded guilty to online enticement of a minor.  Ruiz admits to luring a 14-year-old girl, via the Whisper app, to sneak out of her house during the night and engage in sexual intercourse with him in March 2017.  He now faces a minimum of ten years to life in prison and a $250,000 fine.  This case was brought as part of the U.S. Attorney’s Project Safe Childhood initiative, which seeks to combat the growing epidemic of child sexual exploitation on the Internet. United States Secret Service and the Arlington Police Department investigated.

PLEA – Jeremey Brown, 38
On Sept. 18, Jeremey Brown of Dunacan, Oklahoma pleaded guilty to breaking out of federal prison. Brown,  who was serving time in the Big Spring Federal Correctional Institution for a firearms offense, was spotted jumping into a maroon Nissan Altima near Big Spring on May 19. The U.S. Marshals Service and the Big Spring FCI Special Investigative Services conducted the investigation. Brown’s getaway driver also pleaded guilty to concealing a person from arrest.  Release here.

PLEA – Christopher Shane Eudy, 41
On Sept. 19, Christopher Shane Eudy – who is currently serving time in state prison for fraudulent use of identification information -- pleaded guilty to use of an unauthorized access device. Eudy admits that in February 2017, he falsified his identity and visited a Aledo, TX store to pick up a $2,000 generator ordered with a stolen credit card number.  A group later sold the equipment, and Eudy pocketed a portion of the proceeds. He now faces up to 10 years in federal prison. The Secret Service conducted the investigation.

INDICTMENT -- Mohamed Toure, 57 & Denise Cros-Toure, 57
On Sept. 19, a federal grand jury indicted a Texas couple on forced labor and alien harboring charges. The Toure’s allegedly arranged for a child to travel alone from her village in Guinea, West Africa to Southlake, Texas to work for them in their home. For more than 16 years, they demanded she handle childcare, cook, and clean, all with no pay, while isolating her from friends and family. The case is being investigated by the Department of State, Diplomatic Security Services’ Houston Field Office. Release here.

PLEA – William Brian Smith, 44
On Sept. 19, 2018, William Brian Smith of Saginaw, TX pleaded guilty to receipt on child pornography charges. Smith admitted to receiving videos of a child engaged in sexually explicit conduct, which were found after his employer discovered images on Smith’s work computer and contacted the police. He now faces up to 240 months in prison and a fine of up to $250,000.  Saginaw Police Department and HSI conducted the investigation.

PLEA – Joey Lynn Tedford, 53
On Sept. 19, Joey Lynn Tedford of Snyder, TX pleaded guilty to being a felon in possession of a firearm.  Tedford admitted to possessing one rifle and one handgun.  He now faces up to 10 years in prison and a fine of up to $250,000.  As part of the plea, Tedford also agreed to forfeit the firearms to the United States.  The Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF) conducted the investigation.

SENTENCING – Jeffrey Sila
A Kenyan man was sentenced today to more than 7 years behind bars for theft of public funds and aggravated identity theft. Jeffrey Sila, a citizen of Nairobi, allegedly obtained a $76,500 tax return check payable to another individual, then unwittingly sold it to an IRS undercover agent in exchange for $48,000. He was arrested at LAX as he attempted to board a flight for Nairobi, and convicted following a three-day trial in Dallas in September 2017.  

WASHINGTON – Defendants Mohamed Toure, 57, and Denise Cros-Toure, 57, of Ft. Worth, Texas, were charged today in a five-count indictment with forced labor, alien harboring for financial gain, and conspiracies to commit forced labor and alien harboring, announced U.S. Attorney for the Northern District of Texas Erin Nealy Cox and Acting Assistant Attorney General John Gore of the Justice Department’s Civil Rights Division. Mohamed Toure was also charged with making false statements to federal agents.

The defendants were arrested on April 26, 2018, after being charged by criminal complaint. 

According to the indictment, in January 2000, the defendants arranged for the victim, then a minor child, to travel alone from her village in Guinea, West Africa, to Southlake, Texas, to work for them in their home. For more than 16 years, the Toures allegedly forced her to work long hours – demanding she handle childcare, cook, clean, and perform yardwork. Although the victim was close in age to their five biological children, the couple denied her access to schooling, medical care, and other opportunities they afforded their own children, and on several occasions Denise Cros-Toure slapped or struck her as punishment. Until neighbors helped the victim escape in August 2016, the defendants allegedly denied her any pay, isolated her from her family and threatened serious harm if she refused to work.

As part of their scheme to compel the victim’s labor, the defendants confiscated her official documents and caused her to remain unlawfully in the United States after her tourist visa expired in March 2000. They threatened to send her back to Guinea if her work was unsatisfactory.

An indictment is merely an accusation, and the defendants are presumed innocent unless and until proven guilty. If convicted of forced labor, the defendants face a maximum sentence of 20 years in prison, a $250,000 fine, and mandatory restitution. If convicted of alien harboring, the defendants face a maximum sentence of 10 years in prison and a $250,000 fine.

The case is being investigated by the Department of State, Diplomatic Security Services’ Houston Field Office. It is being prosecuted by Trial Attorneys Rebekah Bailey and William Nolan of the Civil Rights Division’s Criminal Section and Human Trafficking Prosecution Unit and Assistant U.S. Attorney Chris Wolfe for the Northern District of Texas.

A Duncan, Oklahoma man pleaded guilty today to breaking out of federal prison, announced U.S. Attorney for the Northern District of Texas Erin Nealy Cox.

Jeremy Brown, 38, who was serving time in the Big Spring Federal Correctional Institution (FCI) for a firearms offense, admits he escaped from federal custody on May 19, 2018.

According to documents filed in the case, the sister of a Big Spring FCI employee spotted Brown running across the street and jumping into a maroon Nissan Altima around 5 p.m. Suspecting she’d witnessed an escape, she snapped a photo as the car sped away, then contacted Big Spring FCI.

Officials initiated an emergency headcount and realized Brown was missing. Two days later, after a warrant had been issued for his arrest, Brown surrendered to Big Spring FCI, and was placed in the Special Housing Unit (SHU).

The driver of the getaway car, Tiffany Stone, 38, pleaded guilty to concealing a person from arrest.

The United States Marshals Service and the Big Spring Federal Correctional Institution Special Investigative Services conducted the investigation, and Assistant U.S. Attorney Jeff Haag prosecuted the case.

SENTENCING – Nemelee Jiao, 48
On September 6, Nemelee Jiao of Irving, TX was sentenced to more than 8 years in federal prison for her role in operating a $3.4 million Ponzi-scheme investment fraud. In December 2017, Jiao pleaded guilty to one count of wire fraud after FBI agents identified 41 victims who invested in fake securities related to two schools in the Philippines.

SENTENCING – Mark Stein, 38
On September 10, Mark Demetri Stein, the 38-year-old final defendant in a high-profile north Texas “foreclosure rescue” case was sentenced for his role in the scheme, which swindled nearly a quarter of a million dollars from at least 70 homeowners facing foreclosure. Stein, of Carrollton, Texas – who pleaded guilty in April to one count of mail fraud – was sentenced to 6 years in prison and ordered to pay $215,138 in restitution to homeowner victims. Release here.

SENTENCING -- Sergio Gonzalez, 34
On September 10, Sergio Guadalupe Gonzalez was sentenced to more than 3 years in federal prison for his role in a cocaine distribution conspiracy. In March, Gonzalez pleaded guilty to conspiracy to possess with intent to distribute cocaine, after the FBI initiated an investigation into several DFW subjects’ importation and distribution of cocaine and methamphetamine.

SENTENCING – Shetoia Mitchell, 31
On September 10, Shetoia Mitchell was sentenced to nearly 3 years in federal prison for her role in an attempted bank robbery. In February, Mitchell pled guilty to an attempt to commit a bank robbery on July 11, 2017, but was believed to have actually committed four prior robberies in the summer of 2017, in which she wore a purple burka-style covering and red running shoes.  The FBI and the Dallas Police Department investigated.

INDICTMENT* – Richard Lein, 35 & Marcus Pierson, 47
On September 11, a federal grand jury indicted Richard Lein and Marcus Pierson on drug trafficking charges stemming from DEA’s seizure of almost three kilos of methamphetamine.  If convicted, Lein faces up to 20 years imprisonment, while Pierson faces a minimum of 10 years and up to life for the drug charges and a minimum of 5 years and up to life for possessing a firearm in furtherance of a drug trafficking crime.

INDICTMENT* – Richard Blankenship, 32 
On September 11, a federal grand jury indicted Richard Blankenship of Lewisville on felon in possession of a firearm and drug trafficking charges. A formerly convicted felon, Blankenship allegedly possessed more than 50 grams of methamphetamine, baggies and a scale, along with a .45 caliber pistol. If convicted, he faces 10 years to life in federal prison. The Drug Enforcement Agency-High Intensity Drug Trafficking Areas (“HIDTA”) investigated the case.

INDICTMENT* – Chelsea Williams
On September 11, a federal grand jury indicted Chelsea Shanae Williams of Dallas for possession of cocaine with the intent to distribute.  If convicted, Williams faces up to almost 6 years in federal prison.  The ATF and Dallas Police Department investigated.

INDICTMENT* -- Zachery Leatch, 24 & Tara Jones, 37
On September 11, a federal grand jury indicted Leatch and Jones, of Dallas, for possession of a firearm by a prohibited person and possession of a firearm in a school zone. The defendants, both convicted of prior felonies, allegedly brought a .40 caliber pistol into the gym of the Thompson Elementary School in Mesquite during a youth basketball game.  If convicted, they face up to 120 months in federal prison. Mesquite PD and ATF investigated the case.

SENTENCING – Israel De la Cruz Sotelo, 42
On September 13, Israel De la Cruz Sotelo, also known as “Rale,” was sentenced to 12 ½ years in prison for his role in a methamphetamine and marijuana conspiracy. After being extradited from Mexico, De la Cruz Soleto pled guilty in November and December to federal charges. De la Cruz Sotelo’s case is the result of the ongoing efforts of the Organized Crime Drug Enforcement Task Force (OCDETF). The DEA, Dallas Police Department, and Garland Police investigated; U.S. Marshals, CBP, ICE, and Homeland Security Investigations (HIS) assisted.

INDICTMENT* -- Demoushae & Tashonna Marsh
On Sept. 14, the straw purchasers of a gun used to murder an innocent man appeared in federal court, charged with making false statements during the acquisition of a firearm. Sisters Demoushae and Tashonna Marsh allegedly purchased two 9-millimeter Glock pistols from Academy Sports + Outdoors, each claiming on her application she was the “actual buyer” of the firearm, while knowing the guns were intended for someone else. Release here.

* An indictment is a formal accusation of criminal conduct, not evidence. A defendant is presumed innocent unless convicted through due process of law.

DALLAS – The straw purchasers of a gun used to murder an innocent man appeared in federal court today, charged with making false statements during the acquisition of a firearm, announced U.S. Attorney for the Northern District of Texas Erin Nealy Cox.

According to the Indictment, unsealed following the defendants’ arrest yesterday, sisters Demoushae and Tashonna Marsh purchased two 9-millimeter Glock pistols from Academy Sports + Outdoors, a federally-licensed firearm dealer, on April 16.  On their applications, each woman claimed she was the “actual buyer” of the firearm – while allegedly knowing the guns were intended for someone else. 

One of the pistols ended up in the hands of a teenage boy.

On April 18 -- just two days after the straw purchase – the juvenile and a co-conspirator attempted to rob a man in the driveway of his Dallas home. Upon hearing the struggle, the victim’s brother, Leonardo Vazquez-Barcenas, came outside to investigate. The juvenile, still struggling with the homeowner, fired a single shot, killing Mr. Vazquez-Barcenas.

“Federal firearm restrictions are designed to keep deadly weapons from being used in street crimes like these,” said Nealy Cox. “This case should send a message to would-be straw purchasers across north Texas:  We will bring to justice anyone who attempts to circumvent gun laws in our district.”

The Dallas County District Attorney’s Office is handling the homicide case. The straw purchasing case was brought as part of the U.S. Attorney’s “Project Safe Neighborhood” initiative, a strategic effort targeting violent offenders in Dallas’ most dangerous neighborhoods. The Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF) conducted the investigation with assistance from the Dallas Police Department; Assistant U.S. Attorney P.J. Meitl is prosecuting the case.

An Indictment is a formal accusation of criminal conduct, not evidence. A defendant is presumed innocent unless convicted through due process of law.

DALLAS -- The final defendant in a high-profile north Texas “foreclosure rescue” case has been sentenced for his role in the scheme, which swindled nearly a quarter of a million dollars from at least 70 homeowners facing foreclosure, announced U.S. Attorney Erin Nealy Cox of the Northern District of Texas.

Real Estate Solutions owner Mark Demetri Stein, 38, of Carrollton, Texas – who pleaded guilty in April to one count of mail fraud – was sentenced to six years in prison and ordered to pay $215,138 in restitution to homeowner victims. 

According to documents filed in the case, from Feb. 2012 to Jan. 2013,  Stein and three co-conspirators used third parties to contact vulnerable homeowners, offering them an opportunity to get out of their present home loans and receive new, cheaper loans with lower interest and reduced monthly payments.

They lied to desperate homeowners, telling them “investors” were standing by, ready to purchase homeowners’ loans from their original lenders at a greatly reduced price through a “short sale” process, and suggesting homeowners had the legal authority to transfer their deeds to a foreclosure rescue company. Then, although they knew they would not legally own the property, Stein and his co-defendants assured homeowners a foreclosure rescue company could “sell” the property back to the homeowner with a new loan.

There were no investors.  The defendants simply pocketed funds collected from these defrauded homeowners.

They issued fraudulent new “loans” requiring hefty down payments, demanded the homeowners sign fraudulent documents, and directed homeowners to start making all future loan payments to them.  

As they continued to collect these so-called “mortgage payments,” they instructed homeowners to ignore notices of late- and non-payment from other lenders. In order to further conceal their criminal conduct, they even advised several homeowners file bankruptcy in order to forestall foreclosure.  

The three other defendants, Christina Renee Caveny, 37, Richard Bruce Stevens, 53, and Bruce Kevin Hawkins, 54, also pleaded guilty and were sentenced for felony offenses stemming from the scheme. (Caveny was sentenced to 15 months in prison in November 2017. The following month, Hawkins was sentenced to 41 months.  Late last month, Stevens was sentenced to 41 months.)

The case was brought as part of the Northern District of Texas’ Bankruptcy Fraud Initiative. Since May 2013, the initiative has prompted a significant increase in the number of felony prosecutions of bankruptcy-related crimes in north Texas. A total of 27 defendants – each prosecuted due to criminal referrals from the United States Trustee’s Office – have been charged and convicted. 

The Federal Bureau of Investigation’s Dallas Division conducted the investigation, and Assistant U.S. Attorney David Jarvis prosecuted the case.

Fifteen defendants who were wanted by the FBI for their suspected involvement in a series of violent robberies against traveling jewelry salesmen across the United States, have been arrested, the last of whom on Sept. 2, announced Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Erin Nealy Cox for the Northern District of Texas and Special Agent in Charge Eric K. Jackson of the FBI Dallas Field Office.

An indictment and three superseding indictments, issued in Feb. 18, 2016; Jan. 24, 2017; Nov. 21, 2017; and Jan. 23, 2018, respectively, charge the 15 defendants, all Colombian nationals, with the following offenses relating to the 11 robberies/attempted robberies:

Jonathan David Malpica, 33

RICO conspiracy, conspiracy to interfere with commerce by robbery, interference with commerce by robbery

Tito Andres Vargas Urbina, 31

RICO conspiracy, conspiracy to interfere with commerce by robbery, interference with commerce by robbery

Roger Zamora, aka Jaime Alba Juarez, 40

RICO conspiracy, conspiracy to interfere with commerce by robbery, interference with commerce by robbery

Camila Andrea Espitia, 23

Conspiracy to interfere with commerce by robbery, interference with commerce by robbery

Mohammed Natour, 32

RICO conspiracy, conspiracy to interfere with commerce by robbery, interference with commerce by robbery

Omar Gonzalez, 38

RICO conspiracy, conspiracy to interfere with commerce by robbery

Fabrizia Cavanna Sarmiento, aka Fabrizia Cavanna, 41

RICO conspiracy, conspiracy to interfere with commerce by robbery

Andres Felipe Henao, 32

Conspiracy to interfere with commerce by robbery, interference with commerce by robbery

Brayan David Vargas Londono, aka Brayan Vargas, Brayan David Vargas Gonzalez, Mario Steven Cuellar, Joshua Steven

Cavarez, Blanco Elizanoro Recioachach, 25

Conspiracy to interfere with commerce by robbery

Rodolfo Vargas Londono, aka Christian Vargas, 30

Conspiracy to interfere with commerce by robbery

Luis Garcia, 31

Conspiracy to interfere with commerce by robbery

Catherine Salas, 34

Conspiracy to interfere with commerce by robbery

Erika Gutierrez Machado, aka Angela Cuebas, 45

Conspiracy to interfere with commerce by robbery

James Jeanphier Tobar Ramon, aka Panda, Jonathan Tapia, Jhonatan Vasquez Toloza, 27

RICO conspiracy, conspiracy to interfere with commerce by robbery, interference with commerce by robbery

Jesus Jean Pool Tovar, aka Yakusa, 24

Conspiracy to interfere with commerce by robbery

The indictments charge the defendants for their alleged involvement in 11 robberies/attempted robberies in five states, from 2014 through 2016:

Date (on or about)

Robbery Location

Sept. 26, 2014

Oklahoma City, Oklahoma

Jan. 30, 2015

Dallas, Texas

March 31, 2015

Miami Beach, Florida

July 8, 2015

Houston, Texas

Sept. 3, 2015

Dallas, Texas

Oct. 26, 2015

Houston, Texas

Nov. 10, 2015

Hollywood, Florida

Nov. 15, 2015

Indianapolis, Indiana

Dec. 6, 2015

Vienna, Virginia

Jan. 21, 2016

Farmers Branch, Texas

Jan. 27, 2016

Dallas, Texas

The series of indictments charged that the members and associates of the robbery enterprise allegedly operated in the following ways:

• Members of the enterprise and their associates allegedly obtained rental vehicles, airline tickets, hotel rooms, and other short-term housing, and opened bank accounts and obtained bank cards and credit cards using fraudulent identification documents to facilitate the robberies and surveillance operations;
• Members of the enterprise and their associates allegedly conducted surveillance on diamond and jewelry stores and traveling diamond and jewelry salesmen in order to identify prospective robbery victims, using teams of individuals to watch the stores from their vehicles and on foot;
• Members of the enterprise and their associates allegedly blocked-in the vehicles of traveling diamond and jewelry salesmen and often disabled the vehicles by, among other means, flattening the vehicles’ tires and breaking the vehicles’ windows;
• Members of the enterprise and their associates allegedly used violence, threats of violence, and weapons, including BB guns, knives, blades, and center punches; and
• Members of the enterprise and their associates allegedly sold the stolen diamonds, jewels, jewelry, and other goods to individuals who buy and sell stolen goods (“fences”), including an individual who traveled from Colombia to the United States to purchase the stolen goods, and then split the proceeds of their unlawful activities.

Further investigative efforts led to the location and arrest of all 15 defendants, the most recent of which took place on Sept. 2, when Tobar was arrested in Miami, Florida, by the Miami Beach Police Department Robberies Unit, in coordination with the FBI.

Rodolfo Vargas Londono, Cavanna, and Brayan David Vargas Londono, were all arrested in Colombia by the Colombian National Police, DIJIN Vetted Team, on Oct. 27, 2017, Dec. 24, 2017, and Feb. 12, 2018, respectively.

The other 11 defendants were arrested in the United States from 2016 through 2017.

“The defendants allegedly embarked on a multi-state spree of violent robberies, putting the lives of their victims and other innocent civilians at risk,” said Assistant Attorney General Benczkowski.  “Thanks to the dedication and cooperative efforts of prosecutors in the Criminal Division’s Organized Crime and Gang Section and the U.S. Attorney’s Office in the Northern District of Texas, along with our partners with the FBI Dallas Violent Crimes Task Force, all 15 defendants indicted for this interstate armed robbery conspiracy have been apprehended and now must face justice.  I especially thank our Colombian law enforcement partners for their hard work in securing the arrest of three fugitives in this important case.”

“These individuals painstakingly surveilled, menaced, and violently robbed salespeople in the Northern District of Texas and elsewhere,” said U.S. Attorney Nealy Cox.  “My office is committed to rooting out these kinds of criminal conspiracies. I thank our law enforcement partners – both here in the United States and in Colombia – for helping us bring these defendants to justice.”

“The investigation and indictments of this violent and dangerous foreign criminal enterprise by the personnel of the Dallas FBI Office, our law enforcement partners, and prosecutors hopefully have sent a clear message,” said FBI Special Agent in Charge Jackson.  “We have no tolerance for those who would violate the sovereignty of the United States to further their criminal goals and we will bring you to justice no matter where in the world you are located.”

To date, nine defendants in total pleaded guilty to charges relating to the robberies:

• Gonzalez pleaded guilty to RICO conspiracy on July 27, 2017. Gonzalez was sentenced to 66 months in prison on Feb. 20.
• Urbina pleaded guilty to RICO conspiracy on Aug. 29, 2017, and is awaiting sentencing.
• Malpica pleaded guilty to RICO conspiracy on Sept. 5, 2017, and is awaiting sentencing.
• Machado pleaded guilty to conspiracy to interfere with commerce by robbery on Sept. 5, 2017. Machado was sentenced to 40 months in prison on Jan. 22.
• Salas pleaded guilty to conspiracy to interfere with commerce by robbery on Oct. 31, 2017, and is awaiting sentencing.
• Henao pleaded guilty to conspiracy to interfere with commerce by robbery on Jan. 9, and is awaiting sentencing.
• Natour pleaded guilty to RICO conspiracy on March 13, and is awaiting sentencing.
• Zamora pleaded guilty to RICO conspiracy on March 20, and is awaiting sentencing.
• Garcia pleaded guilty to conspiracy to interfere with commerce by robbery on March 27, and is awaiting sentencing.

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 Dallas Violent Crimes Task Force investigated the case, with assistance from the Colombian National Police, DIJIN Vetted Team. The Justice Department’s Office of International Affairs provided significant assistance in the extradition matters.  Trial Attorney Joseph Wheatley of the Criminal Division’s Organized Crime and Gang Section and Assistant U.S. Attorney Keith Robinson of the Northern District of Texas, are prosecuting the case.

DALLAS - Five members of MS-13, a violent criminal gang, are in custody today after being indicted by a federal grand jury, announced U.S. Attorney for the Northern District of Texas Erin Nealy Cox. 

“MS-13 is one of the most ruthless gangs on the streets,” said U.S. Attorney Nealy Cox.  “This case – along with the eight MS-13 gang members we indicted earlier this summer -- underscores our commitment to dismantle this organization in and throughout our District and keep gangs from terrorizing our citizens.”

Carlos Enreique Mejia Caceres, aka “Machete,” Francisco Javier Argueta Montes, aka “Rostro,” Juan Carlos Andrade Rivas, Luis Santiago Marrego, aka “Shorty,” and Luis Fernando Salazar Angeles were charged with conspiracy to interfere with commerce by robbery, interference with commerce by robbery, and brandishing a firearm during a crime of violence.

On May 16, 2018, prosecutors say, Montes, Rivas, and Marrego disguised their identities and entered Plaza Ferrache Western Wear in Dallas, where they brandished a firearm and took money from an employee. They fled the scene with Angeles as the getaway driver, and divided the money between themselves, Angeles, and Caceres, who masterminded the scheme.

Each faces a maximum life sentence.

The Federal Bureau of Investigation conducted the investigation, and Assistant U.S. Attorney P.J. Meitl is prosecuting the case.

An indictment is a formal accusation of criminal conduct, not evidence. A defendant is presumed innocent unless convicted through due process of law.

In July, a federal grand jury in the Northern District of Texas indicted eight MS-13 members on charges in connection with their gang activities, including attempted murder in aid of racketeering; assault with a dangerous weapon in aid of racketeering; conspiracy to commit murder in aid of racketeering; and possession of a firearm during a crime of violence. And just today, more than 20 individuals associated with MS-13 were arrested in California for assault and drug trafficking.

A federal grand jury this week indicted a Dallas man for defrauding the Summer Food Service Program, a U.S. Department of Agriculture initiative that provides free meals to children in low-income areas when school is not in session.

From June 2011 to October 2014, 42-year-old Michael Anthony Munson, founder of the Heloise Munson Foundation, allegedly submitted reimbursement claims for more than 1.4 million meals he never served, and received $2.5 million in undeserved compensation. 

According to prosecutors, Munson paid another individual roughly $75,000 to fabricate invoices for milk, juice, and food from a fictitious company, “Janus Wholesale Food, Inc.” and to camouflage the scheme.

When Munson was notified authorities were reviewing his reimbursement claims, he notified the individual, who created the domain januswholesalefoods.com, opened a bank account in Janus’ name using a fake IRS Employer Identification Number, and fabricated affidavits from non-existent Janus employees claiming to do business with Munson, which were later submitted to government authorities.

Munson, who surrendered to the FBI Thursday, has been charged with five counts of summer food service program fraud, and faces up to 25 years in prison, along with a $50,000 fine plus restitution.

“Low-income families across our District count on the Summer Food Service Program to provide their children with nutritious meals, ” U.S. Attorney Nealy Cox said. “Anyone who takes advantage of a system designed to serve those already struggling will be prosecuted and brought to justice.”

The U.S. Department of Agriculture - Office of Inspector General and Federal Bureau of Investigation conducted the investigation, and Assistant U.S. Attorney Douglas Brasher is prosecuting the case.

An indictment is a formal accusation of criminal conduct, not evidence. A defendant is presumed innocent unless convicted through due process of law.

U.S. Attorney Erin Nealy Cox today announced the appointment of three new Assistant United States Attorneys: Ryan Raybould, assigned to the Dallas Criminal Division; Sarah Delaney, assigned to the Dallas Civil Division; and Robert Boudreau, assigned to the Fort Worth Criminal Division.

All three prosecutors were sworn in Monday morning before Chief U.S. District Judge Barbara M.G. Lynn.

A graduate of Yale University and Notre Dame Law School, Mr. Raybould today returns to the same district where he clerked for U.S. District Judge Reed O’Connor five years ago.   In the intervening years, he served as an Assistant U.S. Attorney in the Middle District of Tennessee, where he prosecuted white collar crime cases, and before that as a prosecutor in the Justice Department’s Criminal Enforcement Section – Tax Division. Before beginning his legal career, Mr. Raybould spent four years as a professional soccer player, and was drafted by the Kansas City Wizards in 2005.

Ms. Delaney, who earned degrees from Georgetown University and the University of Virginia School of Law, joins the Northern District of Texas from the litigation section of Snell & Wilmer in Phoenix, Arizona. There, she handled a wide range of matters, from regulatory affairs and international trade to product liability and healthcare matters.

Mr. Boudreau joins the Northern District of Texas from the Justice Department’s Criminal Enforcement Section – Tax Division in Washington, DC, where he investigated and prosecuted crimes including tax evasion, investment fraud, identity theft, healthcare fraud, and public corruption. A graduate of the University at Albany and Boston University School of Law, he also served as a judge advocate in the U.S. Marine Corps, where he represented a Marine court-martialed for a high-profile war crime.

“We’re thrilled to welcome these three AUSAs to our hard-hitting teams in Fort Worth and Dallas,” said Nealy Cox. “I’m confident they will serve the cause of justice with honor.”  

Reliant Rehabilitation Holdings Inc. (Reliant), a national provider of rehabilitation therapy and related services headquartered in Plano, Texas, has agreed to pay the United States $6.1 million to resolve allegations that it violated the False Claims Act (FCA), 31 U.S.C. §3729, et seq., by paying kickbacks to skilled nursing facilities and physicians in connection with care provided to Medicare beneficiaries as a way of improperly promoting Reliant’s rehabilitation therapy business, the Justice Department announced today. 

The United States alleged that between April 1, 2013, and May 1, 2017, Reliant knowingly offered improper inducements, in the form of Reliant-employed nurse practitioners who worked at client nursing homes without charge or for a nominal, below fair market fee in order to induce or reward nursing homes for contracting with Reliant to provide rehabilitation therapy for their residents.  The settlement between the United States and Reliant resolves this claim, as well as a separate allegation that Reliant violated the FCA by causing the submission of claims to Medicare that were tainted by improper contracts between Reliant and physicians working at skilled nursing facilities that offered the physicians above fair market compensation for supervising and collaborating with Reliant nurse practitioners in exchange for the facilities’ therapy business.

“The Justice Department is committed to investigating and routing out any improper financial relationships between health care providers that have the potential to undermine patient care and trust.” said Acting Assistant Attorney General Chad A. Readler for the Justice Department’s Civil Division. “This settlement demonstrates our commitment to protecting the integrity of the Medicare program.”

“Companies that work to secure patient referrals by providing kickbacks inject improper financial considerations into our healthcare system,” said United States Attorney Erin Nealy Cox for the Northern District of Texas.  “Today’s settlement demonstrates our determination to thwart such improper inducements — whether they take the form of cash payments or free services.”

“Paying illegal remuneration to nursing homes and doctors to increase the bottom line – as contended by the government in this case – is unacceptable as it too often sacrifices the best interests of patients to profit-making schemes,” said CJ Porter, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services.  “Patients and taxpayers deserve better.”

The allegations resolved by the settlement agreement were originally brought by Dr. Thomas Prose under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private citizens with knowledge of fraud against the government to bring an action on behalf of the United States and to share in any recovery.  Dr. Prose will receive approximately $915,000 of the settlement proceeds. 

The case was handled by the Justice Department’s Civil Division and the U.S. Attorney’s Offices for the Northern District of Texas.  Investigative assistance was provided by the U.S. Department of Health and Human Services Office of Inspector General. 

The lawsuit is captioned United States ex rel. Prose v. Reliant Rehabilitation, Civil Action No. 3:16-CV-0707-D (N.D. Tex.).  The claims settled by this agreement are allegations only, and there has been no determination of liability.