Northern District of Texas

DALLAS — Following a four-day jury trial before U.S. District Judge David C. Godbey, a federal jury has convicted Gilberto Gomez, 37, on felony drug offenses, announced U.S. Attorney John Parker of the Northern District of Texas.

Gomez was convicted yesterday on one count of conspiracy to possess with intent to distribute 500 grams or more of methamphetamine, one count of possession with intent to distribute methamphetamine, one count of possession with intent to distribute cocaine, one count of possession with intent to distribute marijuana, and two counts of possession of a firearm in furtherance of a drug trafficking crime. The drug trafficking conspiracy count carries a maximum statutory penalty of life in federal prison and a $1 million fine. Sentencing is scheduled in June.

Co-conspirator Felix Cantu, 30, pled guilty in March 2017 to conspiracy to distribute methamphetamine and possession of a firearm in furtherance of a drug trafficking crime. No date has been set for his sentencing.

The government presented evidence at trial that beginning in November 17, 2015 until March 1, 2016 Gomez and Cantu operated a drug distribution enterprise from Gomez’s residence on Palacios Avenue in West Dallas. After a four-month long investigation, DEA and the Dallas Police Department executed a search warrant on the residence and recovered more than $37,000 in cash and over $40,000 worth of narcotics. To protect his drugs, Gomez installed three-inch steel coverings for the windows and a coded-entry metal gate in the hallway leading to the master bedroom. Gomez travelled to California every two weeks to purchase marijuana. He concealed the newly purchased marijuana in hidden compartments of vehicles and shipped them back to Texas on open-air tractor-trailers. In an effort to keep drugs off the streets in that neighborhood, the U.S. Attorney’s Office is seeking an order to forfeit the house since it was used for the criminal activity.

The Drug Enforcement Administration and the Dallas Police Department investigated. Assistant U.S. Attorneys Rachael Jones and P.J. Meitl prosecuted.

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ZTE Corporation pleaded guilty today to conspiring to violate the International Emergency Economic Powers Act (IEEPA) by illegally shipping U.S.-origin items to Iran, obstructing justice and making a material false statement.

Attorney General Jeff Sessions of the U.S. Department of Justice, Acting Assistant Attorney General Mary B. McCord for National Security, U.S. Attorney John R. Parker for the Northern District of Texas and Assistant Director Bill Priestap for the FBI’s Counterintelligence Division made the announcement today. The plea was entered before U.S. District Judge Ed Kinkeade.

Specifically, ZTE pleaded guilty to one count of conspiring to unlawfully export in violation of the IEEPA, one count of obstruction of justice and one count of making a material false statement. ZTE agreed to pay a fine in the amount of $286,992,532 and a criminal forfeiture in the amount of $143,496,266, and submit to a three-year period of corporate probation, during which time an independent corporate compliance monitor will review and report on ZTE’s export compliance program.

As previously announced on March 7, at the time that ZTE agreed to plead guilty, the Corporation simultaneously reached settlement agreements with the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) and the U.S. Department of the Treasury’s Office of Foreign Assets Control. In total ZTE has agreed to pay the U.S. Government $892,360,064. The BIS has suspended an additional $300,000,000, which ZTE will pay if it violates its settlement agreement with the BIS.

The plea agreement ended a five-year joint investigation into ZTE’s export practices, which was handled by the DOJ’s National Security Division, the U.S. Attorney’s Office for the Northern District of Texas, the FBI, the BIS, the Department of Homeland Security and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations.

According to plea documents filed in the case, between January 2010 and January 2016, ZTE, either directly or indirectly through a third company, shipped approximately $32,000,000 of U.S.-origin items to Iran without obtaining the proper export licenses from the U.S. government. In early 2010, ZTE began bidding on two different Iranian projects. The projects involved installing cellular and landline network infrastructure. Each contract was worth hundreds of millions of U.S. Dollars and required U.S. components for the final products.

In December 2010, ZTE finalized the contracts with Iranian customers. The contracts were signed by four parties: the Iranian customer, ZTE, Beijing 8 Star and ZTE Parsian (ZTE’s subsidiary in Iran). Court documents explain that ZTE identified Beijing 8 Star (8S) as a possible vehicle for hiding its illegal shipments of U.S. items to Iran. It intended to use 8S to export U.S.-origin items from China to ZTE customers in Iran. As part of this plan, ZTE supplied 8S with necessary capital and took over control of the company.

Under the terms of the Iran contracts, ZTE agreed to supply the “self-developed equipment,” collect payments for the projects and manage the whole network. ZTE Parsian was to provide locally purchased materials and all services. 8S was responsible for “relevant third-party equipment,” which primarily meant parts that would be subject to U.S. export laws. ZTE intended for 8S to be an “isolation company,” that is, ZTE intended for 8S (rather than ZTE) to purchase the embargoed equipment from suppliers and provide that equipment under the contract in an effort to distance ZTE from U.S. export-controlled products, and insulate ZTE from U.S. export violations. However, 8S had no purchasing or shipping history and no real business reputation.

Ultimately, although 8S was a party to the contracts, ZTE itself purchased and shipped the embargoed goods under the contract. In its shipping containers, it packaged the U.S. items with its own self-manufactured items to hide the U.S.-origin goods. ZTE did not include the U.S. items on the customs declaration forms, though it did include the U.S.-origin items on the packing lists included inside of the shipments.

In early 2011, when ZTE determined that the use of 8S was insufficient to hide ZTE’s connection to the illegal export of U.S.-origin goods to Iran, senior management of ZTE ordered that a company-level export control project team study, handle and respond to the company’s export control risks. In September 2011, four senior managers signed an Executive Memo, which proposed that the company identify and establish new “isolation companies” that would be responsible for supplying U.S. component parts necessary for projects in embargoed countries. The isolation companies would conceal ZTE’s role in the transshipment scheme and would insulate ZTE from export control risks.

In March 2012, Reuters published an article regarding ZTE’s sale of equipment to Iran. In response, ZTE made a decision to temporarily cease sending new U.S. equipment to Iran. By November 2013, however, ZTE had resumed its business with Iran. Beginning in July 2014, ZTE began shipping U.S.-origin equipment to Iran once again without the necessary licenses.

Instead of using 8S, however, ZTE identified a new isolation company. ZTE signed a contract with the new isolation company, which in turn signed contracts with the two Iranian customers. According to the new scheme, ZTE purchased and manufactured all relevant equipment – both U.S.-origin and ZTE-manufactured – and prepared them for pick-up at its warehouse by the new isolation company. The new isolation company then shipped all items to the Iranian customers. Shipments to Iran continued from January 2014 through January 2016.

Despite its knowledge of an ongoing grand jury investigation into its Iran exports, according to plea documents, ZTE took several steps to conceal relevant information from the U.S. government. It further took affirmative steps to mislead the U.S. government. In the summer of 2012, ZTE asked each of the employees who were involved in the Iran sales to sign nondisclosure agreements in which the employees agreed to keep confidential all information related to the company’s U.S. exports to Iran.

During meetings throughout late 2014, late 2015 and early 2016, outside counsel for ZTE, unaware that the statements ZTE had given to counsel for communication to the U.S. Government were false, represented to the DOJ and federal law enforcement agents that ZTE had stopped doing business with Iran and therefore was no longer violating U.S. export laws. Similarly, on July 8, 2015, in-house counsel for ZTE accompanied outside counsel in a meeting with the DOJ and federal law enforcement agents and reported that ZTE was abiding by U.S. laws. That statement was also false.

ZTE also hid data related to its resumed illegal sales to Iran from a forensic accounting firm hired by defense counsel to conduct an internal investigation into the company’s Iran sales. ZTE knew the forensic accounting firm was reviewing its systems and knew that the analysis was being reported to the DOJ and U.S. law enforcement. To avoid detection of its 2013-2016 resumed illegal sales to Iran, ZTE formed the “contract data induction team” (“CDIT”). The CDIT was comprised of approximately 13 people whose job it was to “sanitize the databases” of all information related to the 2013-2016 Iran business. The team identified and removed from the databases all data related to those sales. ZTE also established an auto-delete function for the email accounts of those 13 individuals on the CDIT, so their emails were deleted every night – a departure from its normal practices – to ensure there were no communications related to the hiding of the data.

The case is being prosecuted by Deputy Chief Elizabeth Cannon of the National Security Division’s Counterintelligence and Export Control Section and Assistant U.S. Attorney Mark Penley of the Northern District of Texas.

FORT WORTH — Following a two-day jury trial before U.S. District Judge Reed C. O’Connor, a federal jury has convicted two Fort Worth men on felony drug offenses, announced U.S. Attorney John Parker of the Northern District of Texas.

David Piper, Jr., 52, and Carlos Cortinas, 39, were each convicted late yesterday on one count of conspiracy to possess with intent to distribute methamphetamine. The drug trafficking conspiracy count carries a maximum statutory penalty of life in federal prison and a $10 million fine. Sentencing is scheduled for July 17, 2017.

Co-conspirator Chadwick Hernandez, 32, pleaded guilty in February 2017 to the same offense and is scheduled to be sentenced June 26, 2017.

The government presented evidence at trial that beginning in March 2015 until January 20, 2016 Piper and Cortinas possessed with the intent to distribute 500 grams or more of methamphetamine. Evidence elicited at trial showed that methamphetamine distributors from Arlington, including Cortinas, transported multiple pounds of methamphetamine to Piper for re-distrubution of methamphetamine in Bolivar, Missouri.

DEA Fort Worth investigated with the assistance of DEA’s Springfield and Tulsa offices, Arlington Police Department, Fort Worth Police Department, North Richland Hills Police Department, Oklahoma DPS, and Polk County, Missouri Sheriff’s Office. Assistant U.S. Attorneys Aisha Saleem and Shawn Smith prosecuted.

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DALLAS — Jeffrey David Mitchell, 54, of Garland, Texas, was sentenced today by U.S. District Judge Ed Kinkeade to 144 months in federal prison and 10 years supervised release following his guilty plea in August 2015 to one count of transportation of child pornography, announced U.S. Attorney John Parker of the Northern District of Texas.

Mitchell has been in federal custody since his arrest in May 2015 on related charges.

According to documents filed in the case, the investigation began in late April 2015 resulting from a CyberTip from the National Center for Missing and Exploited Children (NCMEC) regarding the upload of images depicting child pornography to an electronic group and to various email accounts. The investigation led law enforcement to secure and execute a search warrant on Mitchell’s home on April 29, 2015; Mitchell and his parents were home during the search.

Mitchell admitted he possessed child pornography and that he sent and received child pornography via his email account. He confirmed that he created and used multiple email accounts to trade the child pornography, and that images of child pornography were on his desktop computer located in his bedroom.

Law enforcement seized several media items from the residence, and a forensic analysis and review of Mitchell’s email accounts revealed approximately 750 images and 100 videos of child pornography. Some of those images and videos depict sadistic/and/or violent content, and some of the files depict infants and toddlers.

The case was brought as part of Project Safe Childhood, a nationwide initiative, which was launched in May 2006 by the Department of Justice, to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals, who sexually exploit children, and identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/. For more information about internet safety education, please visit http://www.justice.gov/psc/ and click on the tab “resources.”

The FBI, Collin County Sheriff’s Office and Garland Police Department investigated. Assistant U.S. Attorney Camille Sparks prosecuted.

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DALLAS — Coby Cole Ditto, 21, was sentenced yesterday by U.S. District Judge Sam A. Lindsay to serve a total of 168 months in federal prison for his role in committing several violent armed robberies in Dallas in 2015, announced U.S. Attorney John Parker of the Northern District of Texas.

Ditto pleaded guilty in October 2016 to one count of conspiracy to interfere with commerce by robbery and one count of using, carrying, brandishing and discharging a firearm during and in relation to a crime of violence.

All of Ditto’s codefendants in the case, Michael Deshun Holland, Jr., 22, Devonte Aaron Dillard, 24, Tatiana Renee Sallie, 20, and Trenton Kyle Sirkel, 21, have pleaded guilty to their respective roles in the conspiracy. Dillard was sentenced to 240 months in federal prison. Skirkel was sentenced to 24 month in federal prison. Holland and Sallie are awaiting sentencing.

According to documents filed in the case, Ditto discussed and planned with each other co-defendants, among other things, the robberies of convenience stores located in Mesquite and Garland, Texas.

On May 8, 2015, Dillard, Holland, Ditto and Sirkel entered the 7-Eleven store on Interstate Highway 30 in Mesquite, brandished a firearm, and robbed the store.

On May 12, 2015, Dillard, Holland, Ditto and Sallie entered the 7-Eleven store on Gus Thomasson Road in Mesquite, brandished a firearm, struck an employee in the head with the firearm, and robbed the store.

That same night, Dillard, Holland, Ditto and Sallie went to the 7-Eleven store on Northwest Highway in Garland, brandished a firearm, assaulted a store employee, and robbed the store.

The case was investigated by Mesquite Police Department, Garland Police Department and the Federal Bureau of Investigation.

Assistant U.S. Attorneys Jamie Hoxie and Keith Robinson prosecuted.

 

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A Maryland man was arrested today on a federal criminal complaint charging him with cyberstalking a Dallas, Texas resident, announced Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division and U.S. Attorney John Parker of the Northern District of Texas.

John Rayne Rivello, 29, of Salisbury, Maryland, was arrested in Maryland today on a criminal complaint filed in the Northern District of Texas.  The complaint was unsealed today following his initial appearance in the District of Maryland.

According to the allegations in the affidavit filed with the complaint, on Dec. 15, 2016, the victim, who is known to suffer from epilepsy, received a message via Twitter from Rivello.  The tweet contained an animated strobe image embedded with the statement, “You deserve a seizure for your post.”  Upon viewing the flashing strobe image the victim immediately suffered a seizure.

Additionally, according to the affidavit, evidence received pursuant to a search warrant showed Rivello’s Twitter account contained direct messages from Rivello’s account to other Twitter users concerning the victim.  Among those direct messages included statements by Rivello, including “I hope this sends him into a seizure,” “Spammed this at [victim] let’s see if he dies,” and “I know he has epilepsy.”  Additional evidence received pursuant to a search warrant showed Rivello’s iCloud account contained a screenshot of a Wikipedia page for the victim, which had been altered to show a fake obituary with the date of death listed as Dec. 16, 2016.   Rivello’s iCloud account also contained screen shots from epilepsy.com with a list of commonly reported epilepsy seizure triggers and from dallasobserver.com discussing the victim’s report to the Dallas Police Department and his attempt to identify the Twitter user.

The charges contained in a criminal complaint are merely accusations, and a defendant is presumed innocent unless and until proven guilty.  

The FBI and the Dallas Police Department investigated the case.  The Maryland State Police and Ocean City Police Department assisted during the arrest.  Assistant U.S. Attorney C.S. Heath of the Northern District of Texas and Aaron Cooper of the Criminal Division’s Computer Crime and Intellectual Property Section are prosecuting the case.

Rivello Complaint

WASHINGTON – A Maryland man was arrested today on a federal criminal complaint charging him with cyberstalking a Dallas, Texas resident, announced Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division and U.S. Attorney John Parker of the Northern District of Texas.

 

John Rayne Rivello, 29, of Salisbury, Maryland, was arrested in Maryland today on a criminal complaint filed in the Northern District of Texas. The complaint was unsealed today following his initial appearance in the District of Maryland.

According to the allegations in the affidavit filed with the complaint, on Dec. 15, 2016, the victim, who is known to suffer from epilepsy, received a message via Twitter from Rivello. The tweet contained an animated strobe image embedded with the statement, “You deserve a seizure for your post.” Upon viewing the flashing strobe image the victim immediately suffered a seizure.

Additionally, according to the affidavit, evidence received pursuant to a search warrant showed Rivello’s Twitter account contained direct messages from Rivello’s account to other Twitter users concerning the victim. Among those direct messages included statements by Rivello, including “I hope this sends him into a seizure,” “Spammed this at [victim] let’s see if he dies,” and “I know he has epilepsy.” Additional evidence received pursuant to a search warrant showed Rivello’s iCloud account contained a screenshot of a Wikipedia page for the victim, which had been altered to show a fake obituary with the date of death listed as Dec. 16, 2016. Rivello’s iCloud account also contained screen shots from epilepsy.com with a list of commonly reported epilepsy seizure triggers and from dallasobserver.com discussing the victim’s report to the Dallas Police Department and his attempt to identify the Twitter user.

 

The charges contained in a criminal complaint are merely accusations, and a defendant is presumed innocent unless and until proven guilty.

 

The FBI and the Dallas Police Department investigated the case. The Maryland State Police and Ocean City Police Department assisted during the arrest. Assistant U.S. Attorney C.S. Heath of the Northern District of Texas and Aaron Cooper of the Criminal Division’s Computer Crime and Intellectual Property Section are prosecuting the case.

 

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DALLAS — Richard Ferdinand Toussaint, Jr., 58, of Dallas appeared today before U.S. District Judge Sidney A. Fitzwater and pleaded guilty to one count of conspiracy to pay health care bribes and kickbacks and one count of offering or paying illegal remuneration and aiding and abetting under the Travel Act announced U.S. Attorney John Parker of the Northern District of Texas.

Toussaint faces a maximum statutory penalty of five years in federal prison and a $250,000 fine for each count. Sentencing will be scheduled at a later date.

Co-defendants Andrea Kay Smith, 37, of Rockwall, Kelly Wade Loter, 48, of Dallas, and Israel Ortiz, 49, also of Dallas previously pleaded guilty to their role in the conspiracy. The remaining 17 defendants are awaiting trial scheduled for July 10, 2017.

 

According to plea documents filed in the case, Toussaint, an anesthesiologist, met co-defendant Barker in approximately 2003 and began providing anesthesia services for his cases around 2005. Around 2008, Toussaint and Barker decided to start their own physician-owned hospital, Forest Park Medical Center (FPMC). All the surgeries at FPMC were to be elective in nature. FPMC targeted bariatric and spinal surgeons because their surgeries generated the most money. The original plan was for FPMC to go in-network with the major insurance carriers when possible. Instead, FPMC attempted to negotiate better reimbursement rates and remained out-of-network so it could collect more in reimbursements.

 

All of the founders at FPMC, including Toussaint and co-defendants Beauchamp, Burt, Barker, and the other founders knew that FPMC would pay surgeons marketing checks in exchange for bringing surgeries, especially lucrative out-of-network surgeries, to FPMC as opposed to other facilities. Beauchamp discussed the details of the payments with each doctor, and he kept tabs on how many surgeries they brought to FPMC. Beauchamp used a metric to calculate the payments based on the surgeons anticipated case volumes at FPMC. The payments quickly grew from $300,000 a month to $1.2 million a month. Beauchamp would update Toussaint and Barker on the bribe payments. Toussaint would often be copied on emails where Barker would ask Beauchamp how much certain doctors were being paid.

 

To induce patients with both in-network and out-of-network benefits to come to FPMC, and to facilitate the bribe and kickback payments, FPMC systematically waived coinsurance or reduced it to in-network levels. According to Toussaint, this practice was concealed or misrepresented to insurance carriers so they would not refuse to reimburse the hospital. Everyone associated with FPMC, including Beauchamp, Burt, Toussaint, Barker, and the surgeons receiving bribe and kickback payments, knew that FPMC guaranteed patients prior to surgery that they would not pay or would pay only the equivalent of in-network patient-responsibility payments.

 

Toussaint and Barker owned a commercial real estate company that was working on the continued development of FPMC. Beauchamp used the company to funnel bribe and kickback payments in exchange for patient referrals.

 

FPMC also made bribe and kickback payments to chiropractors to induce them to send their patients that needed surgery to FPMC as opposed to other facilities. Toussaint would often meet with chiropractors for these discussions and there was a clear quid-pro-quo, that is, the chiropractors were paid to refer their patients to FPMC.

 

In addition to paying surgeons bribes and kickbacks for cases being performed at FPMC in the form of marketing money, FPMC also used the opportunity to invest in FPMC, and the number of investment units a surgeon could purchase, to induce surgeons to bring their patients to FPMC. The more surgeries a surgeon could bring to FPMC, the more they were allowed to invest and profit from the hospital’s billings. Beauchamp, Barker, and Toussaint often decided how many shares a surgeon should be able to purchase based on the number of surgical cases the surgeon could steer to FPMC. Surgeon-investors who did not bring enough surgical cases to FPMC were divested or their shares were cut.

 

The case was investigated by the FBI, 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.

 

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DALLAS — Following a one-week trial before U.S. District Judge Sam A. Lindsay, a federal jury convicted Gary Busby, 63, formerly of Flower Mound, Texas, on one count of conspiracy to manufacture firearms without a license and four counts of structuring transactions to evade reporting requirements, announced U.S. Attorney John Parker of the Northern District of Texas.

Specifically, in December 2010, Busby met an individual at a gun show and sold him firearms knowing he did not have federal firearms licenses (FFL). Busby agreed to manufacture AR-15 and AK stripped receivers into fully functional firearms in a series of transactions until December 2011. At some time during that period, Busby became aware that the firearms he was manufacturing, and the firearms he agreed to manufacture, had and would be sent to Mexico.

In January 2011, officers with the Hidalgo Police Department recovered fifteen firearms, hidden in a gas tank of a vehicle attempting to enter Mexico. Seven of those firearms were traced directly to the conspirators in this case, including Gary Busby.

In February 2011, officers with the Fort Worth Police Department saw Busby at a gun show negotiating gun purchases for this individual. Busby would contact potential sellers and negotiate the price. A firearm purchased at this gun show was later recovered in Mexico.

During a search of Busby’s residence in July 2011, federal agents catalogued all the firearms and ammunition at the residence. That same day, Busby signed a letter putting him on notice that he was to cease and desist in engaging in the business of selling firearms without a license and advising him that several of the firearms he had sold had been recovered during criminal activities. In spite of the notification, one of the firearms catalogued that day at Busby’s residence was later found in Mexico by authorities.

Over the course of 2010 and 2011, evidence showed that Gary Busby manufactured hundreds of AR-15 and AK firearm receivers into fully functional firearms and made thousands of dollars doing so. Law enforcement found approximately fifty of those firearms as they were being smuggled into or recovered in Mexico. The government also presented evidence showing that Busby lied on ATF forms related to firearm purchases, specifically of receivers, by stating that he was the actual buyer of the receiver, knowing that he would sell or trade that receiver to third parties.

Evidence also showed that from approximately December 2010 to September 2012, Busby purchased hundreds of postal money orders at dozens of post offices in the Dallas-Fort Worth area, in an effort to hide the proceeds of his illegal firearm activity. Busby would only purchase two $1,000 money orders at a time at one post office, using cash, and would travel to up to six post offices in one day, purchasing $2,000 in money orders at each. Doing so, he was knowingly evading the federal reporting requirement for when a customer purchases $3,000 or more in money orders. In 2011 alone, Busby purchased approximately $236,000 in postal money orders, in order to hide the money made manufacturing firearms. Evidence presented to the jury showed that he knowingly structured these cash transactions.

The Bureau of Alcohol, Tobacco, Firearms and Explosives and the U.S. Postal Inspection Service investigated. Assistant U.S. Attorney Kate Rumsey and First Assistant U.S. Attorney Chad Meacham are in charge of the prosecution.

 

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DALLAS — A Dallas-area man has been charged by federal criminal complaint stemming from his role in selling the heroin that caused a young woman’s overdose death at a McDonald’s restaurant in Farmers Branch in June 2016. Two other men were charged by federal criminal complaints stemming from their trafficking of illegal narcotics. The announcement was made today by U.S. Attorney John Parker of the Northern District of Texas.

 

“Tragically, heroin deaths like this are not isolated events anymore,” said U.S. Attorney Parker. “We obviously can’t bring this life back, but we can, together with our state and local partners, bring the full weight of law enforcement to bear on finding and prosecuting those who sell this poison. We will find you.”

 

Specifically, the complaint charges Rogelio Bernal, 20, of Dallas, Texas, and Zakariah Michael Wolf, 29, of Greenville, Texas, with conspiracy to distribute heroin in November of 2016, and separately charges Bernal with conspiracy to distribute heroin in June of 2016. Bernal and Wolf made appearances in federal court this week before U.S. Magistrate Judge Renee Harris Toliver, who ordered that Bernal remain in custody pending the detention hearing set for March 20, 2017, and Wolf remain in custody pending his detention hearing set for March 22, 2017.

 

In a separate complaint, Steven Gomez, 18, of Dallas, Texas, was charged with conspiracy to distribute methamphetamine on March 9, 2017, after having been found sharing a residence with Rogelio Bernal. Gomez made his initial appearance in federal court on March 9, 2017, before U.S. Magistrate Judge Renee Harris Toliver who ordered that he remain in custody pending trial.

 

According to the affidavit filed with the federal complaint for Bernal and Wolf, on November 9, 2016 investigators learned that Bernal distributed heroin in the Farmers Branch, Texas, area. Bernal had been the source of supply of heroin in the area since at least April 2016, and supplied Nancy Pineda, who was previously charged in a separate complaint for her role in the conspiracy. Investigators discovered Bernal had several text conversations with co-conspirators coordinating meetings to conduct illegal drug transactions.

 

On November 17, 2016, Farmers Branch Police Department observed Bernal arrive at a shopping center parking lot in Dallas, Texas. Officers observed a white male get into the front passenger seat of Bernal’s vehicle. The white male was later identified as Wolf. Approximately five to ten minutes later, Wolf exited Bernal’s vehicle and Bernal departed the location.

 

In the early morning hours of November 18, 2016, a Greenville Police officer observed a green 1994 Chrysler Concord, traveling east on Templeton Street in Greenville, Texas. The vehicle was stopped after committing multiple traffic violations, and the driver was identified as Wolf. Wolf was eventually arrested and the Greenville Police Department located a safe in the vehicle containing digital scale, several small clear zip lock style baggies, a syringe, a spoon with possible heroin residue, Suboxone sublingual packs, a half pill of Alprozolam, a plastic baggie containing suspected cocaine, a plastic baggie containing suspected methamphetamine, and a plastic baggie containing suspected heroin. Texas Department of Public Safety Laboratory Analysis of the drugs seized from the safe revealed 11.20 gross grams of heroin and 1.77 gross grams of methamphetamine. Two glass pipes, a wood stick, and 50 packaged syringes were also found in the vehicle.

 

According to the affidavit filed with the Gomez complaint, a federal search warrant was executed on March 9, 2017, at the residence of Bernal and Gomez. A search of Gomez’s room revealed a number of weapons, crack cocaine, and methamphetamine. Specifically, 490 gross grams of crack cocaine, 2,036 gross grams of suspected methamphetamine, and multiple firearms were located.

 

A federal complaint is a written statement of the essential facts of the offense charged, and must be made under oath before a magistrate judge. A defendant is entitled to the presumption of innocence until proven guilty. The U.S. Attorney’s office has 30 days to present the matter to a grand jury for indictment. The penalty for the offenses charged in these criminal complaints is not more than 20 years in federal prison and a $1 million fine.

 

The Farmers Branch Police Department, Greenville Police Department, and the Drug Enforcement Administration are investigating the case. The Grand Prairie Police Department and Dallas Police Department provided assistance for the operation on March 9, 2017. Deputy Criminal Chief Assistant U.S. Attorney Rick Calvert and Assistant U.S. Attorney Myria Boehm are prosecuting.

 

 

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DALLAS — Josue Tijerina, aka “J,” 30, of Dallas, was sentenced yesterday before U.S. District Judge Barbara M.G. Lynn for his role in a methamphetamine distribution conspiracy, announced U.S. Attorney John Parker of the Northern District of Texas.

Tijerina was sentenced to 240 months in federal prison. Tijerian pleaded guilty in August 2016 to one count of distribution of a controlled substance.

Tijerina and 18 co-defendants were charged in a 12-count indictment charging each defendant with one count of conspiracy to possess with intent to distribute 500 grams or more of methamphetamine. All but three of the defendants are also charged with one substantive count of either distribution of methamphetamine or possession with intent to distribute methamphetamine. Two defendants are charged with a firearms offense.

The investigation into this drug trafficking organization, which operated out of the Pleasant Grove, Seagoville and Balch Springs areas of the DFW metroplex, began in early January 2016. During the investigation, law enforcement has seized more than 6700 grams of methamphetamine, approximately 13.2 kilograms of methamphetamine oil, 62 grams of marijuana, 2.5 grams of heroin, and 20 ml of gamma hydroxybutyrate (GHB), as well as 12 firearms and $12,379 in cash.

 

The Department of Public Safety and the Dallas Police Department investigated. Assistant U.S. Attorney Andrew Wirmani prosecuted.

 

 

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LUBBOCK, Texas —Arleen Theres Keithley, 36, was sentenced this morning before U.S. District Judge Sam R. Cummings for her role in a methamphetamine distribution conspiracy, announced U.S. Attorney John Parker of the Northern District of Texas.

 

Keithley was sentenced to 87 months in federal prison. Keithly pleaded guilty in November 2016 to one count of possession with intent to distribute methamphetamine and aiding and abetting.

 

According to documents filed in the case, on April 30, 2016, a trooper with the Texas Department of Public Safety (DPS) stopped a vehicle in Lubbock for traffic violations. Keithley was the driver; co-defendant Crystal Ann Alaniz was the passenger. Keithley was arrested for driving with an invalid license, and Alaniz, who had several outstanding warrants, was also placed under arrest.

 

Both Keithley and Alaniz were placed in the trooper’s vehicle. The in-car video recording system captured Keithley maneuver her hands—while handcuffed—to her left breast area and force a substance in a plastic bag out of her bra. Keithley then used her teeth to remove the item from her bra and toss it to the back seat area where Alaniz was seated. Alaniz hid the item in her pants. Both women were transported to the Lubbock County Detention Center. When asked if either was in possession of any contraband, Alaniz initially stated, “no,” before admitting “I have stuff on me.” Alaniz was searched and two plastic bags containing suspected methamphetamine were found in her pants. Alaniz was also in possession of two plastic bags that contained several smaller plastic bags with markings consistent with narcotics trafficking. Two additional plastic bags, containing suspected methamphetamine were found in Keithley’s bra. Two bundles of money, totaling nearly $2,000 were found in Keithley’s purse along with a digital scale that contained drug residue. Keithley also had $2,500 in small bills on her person.

 

The Texas DPS Crime Lab determined that the suspected methamphetamine was in fact methamphetamine, and it weighed a total of 54.93 grams.

 

The Lubbock Police Department, the Littlefield Police Department, the Texas Department of Public Safety and the Bureau of Alcohol, Tobacco, Firearms and Explosives investigated. Assistant U.S. Attorney Sean Long prosecuted.

 

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FORT WORTH — Following a five-day trial before Senior U.S. District Judge Terry R. Means, a federal jury convicted Waymon Scott McLaughlin, 57, of Fort Worth, Texas, on four counts of bank robbery, announced U.S. Attorney John Parker of the Northern District of Texas.

Each of the bank robbery counts carries a maximum statutory penalty of 20 years in federal prison and a $250,000 fine. McLaughlin will remain in custody pending sentencing scheduled for August 8, 2017.

 

The government presented evidence at trial that McLaughlin robbed the below listed locations:

      May 6, 2016 First Convenience Bank, 3510 Altamesa Blvd., Fort Worth, Texas

 

      May 20, 2016 Woodforest Bank, 2225 W. 120, Grand Prairie, Texas

 

      May 27, 2016 First Convenience Bank, 3510 Altamesa Blvd., Fort Worth, Texas

 

      May 27, 2016 First Convenience Bank, 6756 W. Vickery Blvd., Fort Worth, Texas

 

The Federal Bureau of Investigation, the Grand Prairie Police Department, and the Fort Worth Police Department investigated the case.

 

# # #

DALLAS — Carolina Giselle Berrio, a/k/a “Carolina Slocum Berrio,” “Karrie,” 37, of Lafayette, Louisiana appeared last week before U.S. District Judge Sidney A. Fitzwater and pleaded guilty to a conspiracy charge stemming from her involvement in a “pill mill” operation, announced U.S. Attorney John Parker of the Northern District of Texas.

Specifically, Berrio pleaded guilty to one count of conspiracy to distribute a controlled substance. She faces a maximum statutory penalty of 20 years in federal prison and a fine not to exceed $1 million. Sentencing is scheduled for June 16, 2017.

In March 2015, a federal grand jury in Dallas indicted 23 individuals, including Berrio, on offenses related to their participation in a prescription drug distribution conspiracy. That indictment alleged that from at least May 2013 through July 2014, the defendants participated in a scheme to illicitly obtain prescriptions for pain medications, such as oxycodone and hydrocodone, and then distribute those controlled substances for profit. As part of the conspiracy, individuals, often homeless or of limited means, were recruited and paid to pose as patients at medical clinics, including the McAllen Medical Clinic in Dallas, to obtain prescriptions to fill those prescriptions at designated pharmacies.

To date, 29 defendants have pleaded guilty, including one doctor, one clinic owner, two pharmacists, and numerous co-conspirators, to their involvement in the conspiracy and several have been sentenced to prison terms ranging from probation to 48 months in federal prison.

According to plea documents filed for Berrio, on December 18, 2013, Berrio negotiated to purchase a quantity of oxycodone 30mg pills from co-conspirator Cornelius Robinson, her supplier. Robinson asked for a higher price to deliver the oxycodone to Berrio in Lafayette, Louisiana, and a lower price if Berrio picks up the pills in Houston. Robinson agreed to supply Berrio with oxycodone 30mg at $18.50 per pill, and Berrio agreed to pick up the pills in Houston, Texas. Berrio sought 300 oxycodone 30mg pills with the intent to distribute them at a later time.

In addition, Berrio admits to purchasing oxycodone 30 mg pills from Robinson in both May and March of 2014.

Co-defendant William Hopkins, a/k/a “New York,” 54 of Dallas, Texas was sentenced last week by U.S. District Judge Sidney A. Fitzwater to 5 years probation with intermittent confinement (weekend incarceration) for 52 weeks. Hopkins pleaded guilty in November 2016 to one count of unlawful use of a communication device.

According to documents filed for Hopkins, in a telephone call on August 15, 2013 Hopkins, a recruiter, admonishes a recruit to be available because a driver is trying to pick up the recruit to take him to the doctor’s office. Hopkins encourages the recruit to show up by saying, “This is your money,” meaning the recruit will be paid to go to the doctor’s office to obtain oxycodone or hydrocodone.

This Organized Crime Drug Enforcement Task Force (OCDETF) was investigated by the Drug Enforcement Administration, with assistance from the Texas Department of Public Safety, the Louisiana State Police, the Grand Prairie Police Department, the Dallas Police Department, the Houston Police Department, the Arlington Police Department, the Greenville Police Department, the Parker County Sheriff’s Office, the U.S. Marshal’s Service, the U.S. Postal Inspection Service, and the Diplomatic Security Service. Assistant U.S. Attorney Mary Walters prosecuted.

# # #

LUBBOCK — Six defendants have been charged in a federal indictment, unsealed this week, with felony offenses stemming from their role in a methamphetamine distribution conspiracy, announced U.S. Attorney John Parker of the Northern District of Texas.

Five defendants have made their initial appearance in federal court in Lubbock before U.S. Magistrate D. Gordon Bryant, Jr. and will remain in custody pending trial. One defendant remains a fugitive.

The nine-count indictment charges each of the following defendants with one count of conspiracy to distribute and possess with intent to distribute methamphetamine:

Isaias Perez-Benito, 31, of Amarillo

Juan Rodriguez Galindo, aka “Johnny,” 42, of Amarillo

Corina Villalpando, 50, of Plainview

Dusty Lee Stowers, 29, of Friona

Mona Lesa Thomas, aka “Lisa,” 52, of Lubbock

 

In addition, each defendant is charged with additional substantive counts of distribution of methamphetamine. Perez-Benito was an illegal alien and unlawfully in the United States at the time of the offenses charged and is charged with an additional count of illegal alien in possession of firearms.

A federal indictment is an accusation by a grand jury. A defendant is entitled to the presumption of innocence unless proven guilty. If convicted, however, the conspiracy count carries statutory penalties ranging from 5 years to life in federal prison and a $5 million to $10 million fine. The other substantive drug offenses carry similar penalties. If convicted of the firearm charge, Perez-Benito also faces a maximum statutory penalty of 10 years in federal prison and a $250,000 fine.

The Drug Enforcement Administration, Texas Department of Public Safety, Friona Police Department, and Plainview Police Department are in charge of the investigation.

Assistant U.S. Attorney Sean Long is in charge of the prosecution.

# # #

ZTE Corporation has agreed to enter a guilty plea and to pay a $430,488,798 penalty to the U.S. for conspiring to violate the International Emergency Economic Powers Act (IEEPA) by illegally shipping U.S.-origin items to Iran, obstructing justice and making a material false statement. ZTE simultaneously reached settlement agreements with the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) and the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC). In total ZTE has agreed to pay the U.S. Government $892,360,064. The BIS has suspended an additional $300,000,000, which ZTE will pay if it violates its settlement agreement with the BIS.

 

Attorney General of the United States Jeff Sessions, Acting Assistant Attorney General for National Security Mary B. McCord, U.S. Attorney John R. Parker for the Northern District of Texas and FBI Assistant Director Bill Priestap for the Counterintelligence Division made the announcement today.

 

“ZTE Corporation not only violated export controls that keep sensitive American technology out of the hands of hostile regimes like Iran’s – they lied to federal investigators and even deceived their own counsel and internal investigators about their illegal acts,” said Attorney General Sessions. “This plea agreement holds them accountable, and makes clear that our government will use every tool we have to punish companies who would violate our laws, obstruct justice and jeopardize our national security. I am grateful to the Justice Department’s National Security Division, the U.S. Attorney’s Office for the Northern District of Texas and the FBI for their outstanding work on this investigation.”

 

“ZTE engaged in an elaborate scheme to acquire U.S.-origin items, send the items to Iran and mask its involvement in those exports. The plea agreement, which is pending before the Court, alleges that the highest levels of management within the company approved the scheme. ZTE then repeatedly lied to and misled federal investigators, its own attorneys and internal investigators. Its actions were egregious and warranted a significant penalty,” said Acting Assistant Attorney General McCord. “The enforcement of U.S. export control and sanctions laws is a major component of the National Security Division’s commitment to protecting the national security of the United States. Companies that violate these laws – including foreign companies – will be investigated and held to answer for their actions.”

 

“ZTE Corporation not only violated our export control laws but, once caught, shockingly resumed illegal shipments to Iran during the course of our investigation,” said U.S. Attorney Parker. “ZTE Corporation then went to great lengths to devise elaborate, corporate-wide schemes to hide its illegal conduct, including lying to its own lawyers.” 

 

"The plea agreement in this case shows ZTE repeatedly violated export controls and illegally shipped U.S. technology to Iran," said Assistant Director Priestap. "The company also took extensive measures to hide what it was doing from U.S. authorities. This case is an excellent example of cooperation among multiple U.S. agencies to uncover illegal technology transfers and make those responsible pay for their actions."

 

The plea agreement, which is contingent on the court’s approval, also requires ZTE to submit to a three-year period of corporate probation, during which time an independent corporate compliance monitor will review and report on ZTE’s export compliance program. ZTE is also required to cooperate fully with the Department of Justice (DOJ) regarding any criminal investigation by U.S. law enforcement authorities. The plea agreement ends a five-year joint investigation into ZTE’s export practices, which was handled by the DOJ’s National Security Division, the U.S. Attorney’s Office for the Northern District of Texas, the FBI, the BIS and the Department of Homeland Security, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations.

 

A criminal information was filed today in federal court in the Northern District of Texas charging ZTE with one count of knowingly and willfully conspiring to violate the IEEPA, one count of obstruction of justice and one count of making a material false statement. ZTE waived the requirement of being charged by way of federal indictment, agreed to the filing of the information and has accepted responsibility for its criminal conduct by entering into a plea agreement with the government. The plea agreement, which is contingent on the court’s approval, requires that ZTE pay a fine in the amount of $286,992,532 and a criminal forfeiture in the amount of $143,496,266.  The criminal fine represents the largest criminal fine in connection with an IEEPA prosecution.

 

Summary of the Criminal Conduct

 

According to documents filed today, for a period of almost six years, ZTE obtained U.S.-origin items – including controlled dual-use goods on the Department of Commerce’s Commerce Control List (CCL) – incorporated some of those items into ZTE equipment and shipped the ZTE equipment and U.S.-origin items to customers in Iran. ZTE engaged in this conduct knowing that such shipments to Iran were illegal. ZTE further lied to federal investigators during the course of the investigation when it insisted, through outside and in-house counsel, that the company had stopped sending U.S.-origin items to Iran. In fact, while the investigation was ongoing, ZTE resumed its business with Iran and shipped millions of dollars’ worth of U.S. items there.

 

ZTE also created an elaborate scheme to hide the data related to these transactions from a forensic accounting firm hired by defense counsel to conduct a review of ZTE’s transactions with sanctioned countries. It did so knowing that the information provided to the forensic accounting firm would be reported to the U.S. government by outside counsel. Outside counsel was not aware of this scheme and indeed was wholly unaware that ZTE had resumed business with Iran. After ZTE informed its counsel of the scheme, counsel reported – with permission from ZTE – the conduct to the U.S. government.

 

The Iran Business

 

According to court documents, between January 2010 and January 2016, ZTE, either directly or indirectly through a third company, shipped approximately $32,000,000 of U.S.-origin items to Iran without obtaining the proper export licenses from the U.S. government. In early 2010, ZTE began bidding on two different Iranian projects. The projects involved installing cellular and landline network infrastructure. Each contract was worth hundreds of millions of U.S. Dollars and required U.S. components for the final products.

 

In December 2010, ZTE finalized the contracts with Iranian customers. The contracts were signed by four parties: the Iranian customer, ZTE, Beijing 8 Star and ZTE Parsian. Court documents explain that ZTE identified Beijing 8 Star (8S) as a possible vehicle for hiding its illegal shipments of U.S. items to Iran. It intended to use 8S to export U.S.-origin items from China to ZTE customers in Iran. As part of this plan, ZTE supplied 8S with necessary capital and took over control of the company.

 

Under the terms of the Iran contracts, ZTE agreed to supply the “self-developed equipment,” collect payments for the projects and manage the whole network. ZTE Parsian was to provide locally purchased materials and all services. 8S was responsible for “relevant third-party equipment,” which primarily meant parts that would be subject to U.S. export laws. ZTE intended for 8S to be an “isolation company,” that is, ZTE intended for 8S (rather than ZTE) to purchase the embargoed equipment from suppliers and provide that equipment under the contract in an effort to distance ZTE from U.S. export-controlled products and insulate ZTE from U.S. export violations. However, 8S had no purchasing or shipping history and no real business reputation.

 

Ultimately, although 8S was a party to the contracts, ZTE itself purchased and shipped the embargoed goods under the contract. In its shipping containers, it packaged the U.S. items with its own self-manufactured items to hide the U.S.-origin goods. ZTE did not include the U.S. items on the customs declaration forms, though it did include the U.S.-origin items on the packing lists included inside of the shipments.

 

In early 2011, when ZTE determined that the use of 8S was insufficient to hide ZTE’s connection to the illegal export of U.S.-origin goods to Iran, senior management of ZTE ordered that a company-level export control project team study, handle and respond to the company’s export control risks. In September 2011, four senior managers signed an Executive Memo, which proposed that the company identify and establish new “isolation companies” that would be responsible for supplying U.S. component parts necessary for projects in embargoed countries. The isolation companies would conceal ZTE’s role in the transshipment scheme and would insulate ZTE from export control risks.

 

In March 2012, Reuters published an article regarding ZTE’s sale of equipment to Iran. In response, ZTE made a decision to temporarily cease sending new U.S. equipment to Iran. By November 2013, however, ZTE had resumed its business with Iran. Beginning in July 2014, ZTE began shipping U.S.-origin equipment to Iran once again without the necessary licenses.

 

Instead of using 8S, however, ZTE identified a new isolation company. ZTE signed a contract with the new isolation company, which in turn signed contracts with the two Iranian customers. According to the new scheme, ZTE purchased and manufactured all relevant equipment – both U.S.-origin and ZTE-manufactured – and prepared them for pick-up at its warehouse by the new isolation company. The new isolation company then shipped all items to the Iranian customers. Shipments to Iran continued from January 2014 through January 2016.

 

The Obstruction and False Statement

 

According to court documents, despite its knowledge of an ongoing grand jury investigation into its Iran exports, ZTE took several steps to conceal relevant information from the U.S. government. It further took affirmative steps to mislead the U.S. government. In the summer of 2012, ZTE asked each of the employees who were involved in the Iran sales to sign nondisclosure agreements in which the employees agreed to keep confidential all information related to the company’s U.S. exports to Iran.

 

During meetings throughout late 2014, late 2015 and early 2016, outside counsel for ZTE, unaware that the statements ZTE had given to counsel for communication to the government were false, represented to the DOJ and federal law enforcement agents that ZTE had stopped doing business with Iran and therefore was no longer violating U.S. export laws. Similarly, on July 8, 2015, in-house counsel for ZTE accompanied outside counsel in a meeting with the DOJ and federal law enforcement agents and reported that ZTE was abiding by U.S. laws. That statement was also false.

 

ZTE also hid data related to its resumed illegal sales to Iran from a forensic accounting firm hired by defense counsel to conduct an internal investigation into the company’s Iran sales. ZTE knew the forensic accounting firm was reviewing its systems and knew that the analysis was being reported to the DOJ and U.S. law enforcement. To avoid detection of its 2013-2016 resumed illegal sales to Iran, ZTE formed the “contract data induction team” (“CDIT”). The CDIT was comprised of approximately 13 people whose job it was to “sanitize the databases” of all information related to the 2013-2016 Iran business. The team identified and removed from the databases all data related to those sales. ZTE also established an auto-delete function for the email accounts of those 13 individuals on the CDIT, so their emails were deleted every night – a departure from its normal practices – to ensure there were no communications related to the hiding of the data.

 

The case is being prosecuted by Deputy Chief Elizabeth Cannon of the National Security Division’s Counterintelligence and Export Control Sections and Assistant U.S. Attorney Mark Penley of the Northern District of Texas.

ZTE Information

ZTE Plea Agreement Supplement

ZTE Plea Agreement

ZTE Factual Resume

WASHINGTON – ZTE Corporation has agreed to enter a guilty plea and to pay a $430,488,798 penalty to the U.S. for conspiring to violate the International Emergency Economic Powers Act (IEEPA) by illegally shipping U.S.-origin items to Iran, obstructing justice and making a material false statement. ZTE simultaneously reached settlement agreements with the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) and the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC). In total ZTE has agreed to pay the U.S. Government $892,360,064. The BIS has suspended an additional $300,000,000, which ZTE will pay if it violates its settlement agreement with the BIS.

 

Attorney General of the United States Jeff Sessions, Acting Assistant Attorney General for National Security Mary B. McCord, U.S. Attorney John R. Parker for the Northern District of Texas and FBI Assistant Director Bill Priestap for the Counterintelligence Division made the announcement today.

 

“ZTE Corporation not only violated export controls that keep sensitive American technology out of the hands of hostile regimes like Iran’s – they lied to federal investigators and even deceived their own counsel and internal investigators about their illegal acts,” said Attorney General Sessions. “This plea agreement holds them accountable, and makes clear that our government will use every tool we have to punish companies who would violate our laws, obstruct justice and jeopardize our national security. I am grateful to the Justice Department’s National Security Division, the U.S. Attorney’s Office for the Northern District of Texas and the FBI for their outstanding work on this investigation.”

 

“ZTE engaged in an elaborate scheme to acquire U.S.-origin items, send the items to Iran and mask its involvement in those exports. The plea agreement alleges that the highest levels of management within the company approved the scheme. ZTE then repeatedly lied to and misled federal investigators, its own attorneys and internal investigators. Its actions were egregious and warranted a significant penalty,” said Acting Assistant Attorney General McCord. “The enforcement of U.S. export control and sanctions laws is a major component of the National Security Division’s commitment to protecting the national security of the United States. Companies that violate these laws – including foreign companies – will be investigated and held to answer for their actions.”

 

“ZTE Corporation not only violated our export control laws but, once caught, shockingly resumed illegal shipments to Iran during the course of our investigation,” said U.S. Attorney Parker. “ZTE Corporation then went to great lengths to devise elaborate, corporate-wide schemes to hide its illegal conduct, including lying to its own lawyers.”

 

"The plea agreement in this case shows ZTE repeatedly violated export controls and illegally shipped U.S. technology to Iran," said Assistant Director Priestap. "The company also took extensive measures to hide what it was doing from U.S. authorities. This case is an excellent example of cooperation among multiple U.S. agencies to uncover illegal technology transfers and make those responsible pay for their actions."

 

The plea agreement, which is contingent on the court’s approval, also requires ZTE to submit to a three-year period of corporate probation, during which time an independent corporate compliance monitor will review and report on ZTE’s export compliance program. ZTE is also required to cooperate fully with the Department of Justice (DOJ) regarding any criminal investigation by U.S. law enforcement authorities. The plea agreement ends a five-year joint investigation into ZTE’s export practices, which was handled by the DOJ’s National Security Division, the U.S. Attorney’s Office for the Northern District of Texas, the FBI, the BIS and the Department of Homeland Security, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations.

 

A criminal information was filed today in federal court in the Northern District of Texas charging ZTE with one count of knowingly and willfully conspiring to violate the IEEPA, one count of obstruction of justice and one count of making a material false statement. ZTE waived the requirement of being charged by way of federal indictment, agreed to the filing of the information and has accepted responsibility for its criminal conduct by entering into a plea agreement with the government. The plea agreement, which is contingent on the court’s approval, requires that ZTE pay a fine in the amount of $286,992,532 and a criminal forfeiture in the amount of $143,496,266. The criminal fine represents the largest criminal fine in connection with an IEEPA prosecution.

 

Summary of the Criminal Conduct

 

According to documents filed today, for a period of almost six years, ZTE obtained U.S.-origin items – including controlled dual-use goods on the Department of Commerce’s Commerce Control List (CCL) – incorporated some of those items into ZTE equipment and shipped the ZTE equipment and U.S.-origin items to customers in Iran. ZTE engaged in this conduct knowing that such shipments to Iran were illegal. ZTE further lied to federal investigators during the course of the investigation when it insisted, through outside and in-house counsel, that the company had stopped sending U.S.-origin items to Iran. In fact, while the investigation was ongoing, ZTE resumed its business with Iran and shipped millions of dollars’ worth of U.S. items there.

 

ZTE also created an elaborate scheme to hide the data related to these transactions from a forensic accounting firm hired by defense counsel to conduct a review of ZTE’s transactions with sanctioned countries. It did so knowing that the information provided to the forensic accounting firm would be reported to the U.S. government by outside counsel. Outside counsel was not aware of this scheme and indeed was wholly unaware that ZTE had resumed business with Iran. After ZTE informed its counsel of the scheme, counsel reported – with permission from ZTE – the conduct to the U.S. government.

 

The Iran Business

 

According to court documents, between January 2010 and January 2016, ZTE, either directly or indirectly through a third company, shipped approximately $32,000,000 of U.S.-origin items to Iran without obtaining the proper export licenses from the U.S. government. In early 2010, ZTE began bidding on two different Iranian projects. The projects involved installing cellular and landline network infrastructure. Each contract was worth hundreds of millions of U.S. Dollars and required U.S. components for the final products.

 

In December 2010, ZTE finalized the contracts with Iranian customers. The contracts were signed by four parties: the Iranian customer, ZTE, Beijing 8 Star and ZTE Parsian. Court documents explain that ZTE identified Beijing 8 Star (8S) as a possible vehicle for hiding its illegal shipments of U.S. items to Iran. It intended to use 8S to export U.S.-origin items from China to ZTE customers in Iran. As part of this plan, ZTE supplied 8S with necessary capital and took over control of the company.

 

Under the terms of the Iran contracts, ZTE agreed to supply the “self-developed equipment,” collect payments for the projects and manage the whole network. ZTE Parsian was to provide locally purchased materials and all services. 8S was responsible for “relevant third-party equipment,” which primarily meant parts that would be subject to U.S. export laws. ZTE intended for 8S to be an “isolation company,” that is, ZTE intended for 8S (rather than ZTE) to purchase the embargoed equipment from suppliers and provide that equipment under the contract in an effort to distance ZTE from U.S. export-controlled products and insulate ZTE from U.S. export violations. However, 8S had no purchasing or shipping history and no real business reputation.

 

Ultimately, although 8S was a party to the contracts, ZTE itself purchased and shipped the embargoed goods under the contract. In its shipping containers, it packaged the U.S. items with its own self-manufactured items to hide the U.S.-origin goods. ZTE did not include the U.S. items on the customs declaration forms, though it did include the U.S.-origin items on the packing lists included inside of the shipments.

 

In early 2011, when ZTE determined that the use of 8S was insufficient to hide ZTE’s connection to the illegal export of U.S.-origin goods to Iran, senior management of ZTE ordered that a company-level export control project team study, handle and respond to the company’s export control risks. In September 2011, four senior managers signed an Executive Memo, which proposed that the company identify and establish new “isolation companies” that would be responsible for supplying U.S. component parts necessary for projects in embargoed countries. The isolation companies would conceal ZTE’s role in the transshipment scheme and would insulate ZTE from export control risks.

 

In March 2012, Reuters published an article regarding ZTE’s sale of equipment to Iran. In response, ZTE made a decision to temporarily cease sending new U.S. equipment to Iran. By November 2013, however, ZTE had resumed its business with Iran. Beginning in July 2014, ZTE began shipping U.S.-origin equipment to Iran once again without the necessary licenses.

 

Instead of using 8S, however, ZTE identified a new isolation company. ZTE signed a contract with the new isolation company, which in turn signed contracts with the two Iranian customers. According to the new scheme, ZTE purchased and manufactured all relevant equipment – both U.S.-origin and ZTE-manufactured – and prepared them for pick-up at its warehouse by the new isolation company. The new isolation company then shipped all items to the Iranian customers. Shipments to Iran continued from January 2014 through January 2016.

 

The Obstruction and False Statement

 

According to court documents, despite its knowledge of an ongoing grand jury investigation into its Iran exports, ZTE took several steps to conceal relevant information from the U.S. government. It further took affirmative steps to mislead the U.S. government. In the summer of 2012, ZTE asked each of the employees who were involved in the Iran sales to sign nondisclosure agreements in which the employees agreed to keep confidential all information related to the company’s U.S. exports to Iran.

 

During meetings throughout late 2014, late 2015 and early 2016, outside counsel for ZTE, unaware that the statements ZTE had given to counsel for communication to the government were false, represented to the DOJ and federal law enforcement agents that ZTE had stopped doing business with Iran and therefore was no longer violating U.S. export laws. Similarly, on July 8, 2015, in-house counsel for ZTE accompanied outside counsel in a meeting with the DOJ and federal law enforcement agents and reported that ZTE was abiding by U.S. laws. That statement was also false.

 

ZTE also hid data related to its resumed illegal sales to Iran from a forensic accounting firm hired by defense counsel to conduct an internal investigation into the company’s Iran sales. ZTE knew the forensic accounting firm was reviewing its systems and knew that the analysis was being reported to the DOJ and U.S. law enforcement. To avoid detection of its 2013-2016 resumed illegal sales to Iran, ZTE formed the “contract data induction team” (“CDIT”). The CDIT was comprised of approximately 13 people whose job it was to “sanitize the databases” of all information related to the 2013-2016 Iran business. The team identified and removed from the databases all data related to those sales. ZTE also established an auto-delete function for the email accounts of those 13 individuals on the CDIT, so their emails were deleted every night – a departure from its normal practices – to ensure there were no communications related to the hiding of the data.

 

The case is being prosecuted by Deputy Chief Elizabeth Cannon of the National Security Division’s Counterintelligence and Export Control Sections and Assistant U.S. Attorney Mark Penley of the Northern District of Texas.

 

###

 

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FORT WORTH — A 57-year-old Mineral Wells, Texas, man, Jimmy Gordon, who pleaded guilty in June 2016 to one count of production of child pornography, was sentenced this morning by U.S. District Judge David C. Godbey to 360 months in federal prison, announced U.S. Attorney John Parker of the Northern District of Texas.

According to documents filed in the case, in March 2016, Federal Bureau of Investigation agents executed a search warrant at the residence of Gordon in Mineral Wells, Texas. During the search, Gordon admitted that he communicated with an individual on Facebook, and that, over the course of their communications, Gordon used his cell phone to take a nude picture of his two-year old grandson and to transmit the image to the individual.

The case was brought as part of Project Safe Childhood, a nationwide initiative, which was launched in May 2006 by the Department of Justice, to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals, who sexually exploit children, and identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/. For more information about internet safety education, please visit http://www.justice.gov/psc/ and click on the tab “resources.”

The Federal Bureau of Investigation investigated. Assistant U.S. Attorney A. Saleem prosecuted.

 

# # #

DALLAS — McArthur Baker, 69, a former U.S. Postal Service employee, was sentenced today by U.S. District Judge Sam A. Lindsay to 21 months in federal prison for his role in a scheme to defraud the Department of Labor’s (DOL) Office of Worker’s Compensation Program (OWCP), announced U.S. Attorney John Parker of the Northern District of Texas.

Baker and co-defendant Tonya Evans, 52, both of Dallas, were each convicted following a one-week trial before U.S. District Judge Sam A. Lindsay on one count of conspiracy to defraud the U.S. with respect to claims and one count of false statements or fraud to obtain federal employees’ compensation. Evans is scheduled to be sentenced June 19, 2017.

The government presented evidence at trial that Baker and Evans engaged in a scheme to receive kickbacks in exchange for their completion of falsified medical documentation that was used by co-conspirators to defraud DOL’s OWCP. The government presented further evidence that Baker also falsified forms related to travel he purportedly made for medical services, and as a result, received funds from DOL to which he was not entitled.

Baker began working for the U.S. Postal Service in 1982; he was assigned to work as a mail handler equipment operator. Between 1984 and 2007, Baker filed eight different claims for disability, claiming he suffered from various injuries. As a result of these claims, Baker stopped working in approximately December 2007. He never returned to work but continued to receive disability compensation from December 2007 until at least October 2009. He received more than $68,000 in worker’s compensation payments. He retired from the U.S. Postal Service in October 2009 but he continued to receive disability medical care paid for through DOL, and he continues to be eligible for disability medical care.

Evans began working for the U.S. Postal Service in November 1985; she worked as a clerk primarily with the parcel post distribution machine. She filed disability claims in August 2001, August 2003, and August 2008 claiming that she suffered from various injuries. As a result of these claims, Evans was placed on worker’s compensation in 2001. She received more than $340,000 in worker’s compensation payments. In March 2010, she applied for disability retirement that was approved in October 2011.

Convicted co-conspirator, Larry Washington, was a licensed professional counselor and ran several businesses known as AAA Mental Health, LLC, Mind Spa, Inc., Solutions Health and Rehabilitation, and Convergence Emergence Diversion. Through these businesses, Washington purportedly provided patients with counseling, pain management, chiropractic services, physical therapy, and massage services. His patients were former postal and Veterans Administration employees who had suffered on-the-job injuries and were eligible to receive medical services and worker’s compensation related to those injuries. Earlier this year, Washington pleaded guilty to one count of conspiracy to commit health care fraud and was sentenced in May 2016 to 78 months in federal prison and ordered to pay $7.7 million in restitution.

To maintain and enhance his billings with OWCP, Washington asked claimants, including Baker and Evans, to falsify medical documentation, called “mood inventories,” that indicated they had received services on days they had not. Baker and Evans completed numerous mood inventory forms that contained false information about the days on which Baker and Evans received treatment from Washington or someone working for Washington. Baker and Evans received approximately $100 for each form they completed.

Over the course of the fraud, Baker received a total of at least $3,000 from Washington; Evans received at least $6,000.

As a result of Baker’s falsified documentation, Washington was able to fraudulently bill $105,125 from OWCP. As a result of Evans’ falsified documentation, Washington was able to bill $202,438 from OWCP.

The government presented further evidence that Baker submitted falsified documentation related to travel he purportedly made to receive medical services from Washington and others. He also requested reimbursement for twice the amount of mileage he would have received had he actually received the purported services. As a result, based on fraudulent travel forms he submitted, Baker received more than $3,000.

In addition to Baker and Evans, 20 claimants, four doctors or medical providers, a senior claims examiner at DOL, a claims representative, a Postal employee detailed to the Postal Service Health Resource Management Office, and a medical provider’s employee were charged and convicted in the scheme.

In total, the defendants were able to collectively fraudulently bill the federal government through the OWCP for more than $9.5 million and receive more than $8.7 million in government payments based on their fraudulent billing. The DOL made approximately $11.4 million in payments to these claimants for their compensation and medical services.

 

The investigation was led by the U.S. Postal Service Office of Inspector General, and the Department of Labor Office of Inspector General, with assistance from Internal Revenue Service Criminal Investigation, U.S. Treasury Office of Inspector General, Social Security Administration Office of Inspector General/Cooperative Disability Investigations Unit, and the U.S. Department of Veterans Affairs Office of Inspector General.

 

Assistant U.S. Attorneys P.J. Meitl, Nicole Dana and Special Assistant U.S. Attorney Jennifer Bray prosecuted.

 

# # #

DALLAS, Texas — On Friday, March 3, 2017, U.S. District Judge Sidney A. Fitzwater sentenced Pablo Erick Quincosa-Cabrera, 42, of Dallas, Texas, to 210 months in federal prison, following his guilty plea in November 2016, to one count of conspiracy to possess with intent to distribute a mixture and substance containing a detectable amount of methamphetamine, announced U.S. Attorney John Parker of the Northern District of Texas.

According to documents filed in the case, on five separate occasions between April 2016, and September 2016, Quincosa-Cabrera possessed with the intent to distribute or distributed half-kilogram to kilogram quantities of methamphetamine.

 

The Drug Enforcement Administration, the Allen Police Department, the Garland Police Department, and Rockwall Police Department investigated the case.

Assistant U.S. Attorney Suzanna Etessam prosecuted.

# # #

WASHINGTON – A San Angelo, Texas, man was sentenced to 78 months in prison today for running two investment fraud schemes that defrauded investors out of approximately $900,000 over a four-year period and obstructing a Securities and Exchange Commission (SEC) investigation.

 

Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, U.S. Attorney John R. Parker of the Northern District of Texas and Acting Special Agent in Charge Michael A. Costanzi of the FBI’s Dallas Office made the announcement.

 

Stanley Jonathan Fortenberry, 51, was sentenced by U.S. Districst Judge Sam R. Cummings of the Northern District of Texas. Judge Cummings also ordered the defendant to pay $890,310 in restitution and to forfeit $311,254. On Nov. 18, 2016, Fortenberry pleaded guilty on to two counts of mail fraud and one count of obustruction of justice.

 

In November 2016, when Fortenberry pleaded guilty to fraud and obstruction of justice charges, he admitted that he ran an investment company called Premier Investment Fund (Premier), which raised funds from investors for social media projects run by another company with ties to the country music industry. Fortenberry misled investors about the profitability of the company and about the destination of the investors’ funds. Fortenberry admitted that he diverted approximately half of investors’ funds into his own pocket and to pay the expenses of his fundraising operation.

 

Fortenberry also admitted that, from 2013 to 2014, he ran Wattenberg Energy Partners (Wattenberg), which raised funds for oil and gas drilling projects in northern Colorado. Fortenberry admitted that he set up the company in his son’s name because he was then under investigation by the SEC for misusing the Premier investors’ funds. He used a network of salespeople to solicit individuals over the phone to invest in drilling projects. Fortenberry admitted that he spent the vast majority of the funds on himself and the company’s fundraising operation. In October 2014, at an administrative hearing with the SEC, Fortenberry falsely denied having control of or working for Wattenberg.

 

Fortenberry admitted that the total loss to victims of both schemes was $887,311.

 

The FBI’s Dallas Office investigated the case. Trial Attorney William E. Johnston of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Sean Long of the Northern District of Texas are prosecuting the case. The SEC has provided substantial assistance in this case and referred this matter to the department.

 

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A San Angelo, Texas, man was sentenced to 78 months in prison today for running two investment fraud schemes that defrauded investors out of approximately $900,000 over a four-year period and obstructing a Securities and Exchange Commission (SEC) investigation.

Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, U.S. Attorney John R. Parker of the Northern District of Texas and Acting Special Agent in Charge Michael A. Costanzi of the FBI’s Dallas Office made the announcement.

Stanley Jonathan Fortenberry, 51, was sentenced by U.S. Districst Judge Sam R. Cummings of the Northern District of Texas.  Judge Cummings also ordered the defendant to pay $890,310 in restitution and to forfeit $311,254.  On Nov. 18, 2016, Fortenberry pleaded guilty on to two counts of mail fraud and one count of obustruction of justice.  

In November 2016, when Fortenberry pleaded guilty to fraud and obstruction of justice charges, he admitted that he ran an investment company called Premier Investment Fund (Premier), which raised funds from investors for social media projects run by another company with ties to the country music industry.  Fortenberry misled investors about the profitability of the company and about the destination of the investors’ funds.  Fortenberry admitted that he diverted approximately half of investors’ funds into his own pocket and to pay the expenses of his fundraising operation.  

Fortenberry also admitted that, from 2013 to 2014, he ran Wattenberg Energy Partners (Wattenberg), which raised funds for oil and gas drilling projects in northern Colorado.  Fortenberry admitted that he set up the company in his son’s name because he was then under investigation by the SEC for misusing the Premier investors’ funds.  He used a network of salespeople to solicit individuals over the phone to invest in drilling projects.  Fortenberry admitted that he spent the vast majority of the funds on himself and the company’s fundraising operation.  In October 2014, at an administrative hearing with the SEC, Fortenberry falsely denied having control of or working for Wattenberg.

Fortenberry admitted that the total loss to victims of both schemes was $887,311.

The FBI’s Dallas Office investigated the case.  Trial Attorney William E. Johnston of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Sean Long of the Northern District of Texas are prosecuting the case.  The SEC has provided substantial assistance in this case and referred this matter to the department.

LUBBOCK, Texas — Two Littlefield, Texas, men, Juan Carlos Lara-Ochoa and Jose Alberto Cibrian, were sentenced this morning before U.S. District Judge Sam R. Cummings for their roles in a methamphetamine distribution conspiracy, announced U.S. Attorney John Parker of the Northern District of Texas.

 

Lara-Ochoa, 24, was sentenced to 262 months in federal prison. Lara-Ochoa pleaded guilty in November 2016 to one count of possession with intent to distribute 50 grams or more of methamphetamine. Cibrian, 41, was sentenced to 235 months in federal prison. Cibrian also pleaded guilty in November 2016 to one count of possession with intent to distribute methamphetamine.

 

According to documents filed in court, on June 1, 2016, officers with the Lubbock Police Department learned that Lara-Ochoa would be delivering about two pounds of methamphetamine to Christopher Paul Andrade in Lubbock. Law enforcement set up surveillance and followed Lara-Ochoa from Littlefield, Texas to the La Michoacana grocery on Clovis Highway in Lubbock. Lara-Ochoa parked in the grocery store’s parking lot, and a short time later, Andrade arrived and parked next to him. Andrade got into the front passenger seat of Lara-Ochoa’s vehicle, stayed for less than one minute, and then exited that vehicle, returning to his. Law enforcement followed Andrade as he drove out of the parking lot, and after a brief pursuit, detained Andrade and found approximately 444 grams of methamphetamine that he had attempted to discard during the pursuit.

 

Andrade pleaded guilty in August 2016 to one count of possession with intent to distribute methamphetamine in a separate case. He was sentenced on December 1, 2016, by Senior U.S. District Judge Sam R. Cummings to 135 months in federal prison.

 

Law enforcement observed Lara-Ochoa depart the parking lot and return to Littlefield, where they arrested him. They obtained a search warrant for his vehicle and located a hidden compartment under the front passenger’s seat that contained two separate packages of methamphetamine, weighing a total of 2,230 grams. One of those was packaged exactly the same as the methamphetamine Andrade had discarded. Officers also obtained a search warrant for Lara-Ochoa’s storage unit and found an additional 1,782 grams of methamphetamine and five firearms.

 

On March 4, 2016, officers with the Littlefield Police Department learned of a suspicious vehicle at a nearby RV park. Upon arrival, officers found Jose Alberto Cibrian passed out in the driver’s seat of that vehicle, with the engine running and the gear shift in the drive position. After removing him from the vehicle, officers found a plastic bag containing methamphetamine in the center console, a methamphetamine pipe, a digital scale and a firearm in a bag in the backseat. Cibrian admitted he had recently purchased the methamphetamine and the firearm.

 

The Lubbock Police Department, the Littlefield Police Department, the Texas Department of Public Safety and the Bureau of Alcohol, Tobacco, Firearms and Explosives investigated. Assistant U.S. Attorney Sean Long prosecuted.

 

# # #

DALLAS — Jose Cardenas Aguirre, 25, of Dallas, was sentenced yesterday by U.S. District Judge Jane J. Boyle to 324 months in federal prison, following his guilty plea in October 2016 to one count of conspiracy to commit kidnapping, announced U.S. Attorney John Parker of the Northern District of Texas.

Aguirre is a Mexican citizen and was in the United States illegally at the time of the offense. Aguirre will be deported after serving his sentence.

Co-defendants Melissa Trevino, 23, Javier Martinez, 24, Maria Guadalupe Bello, 22, and Indolfo Martinez, 47, who is Javier Martinez’s father, have pleaded guilty to their roles in the kidnapping, cocaine and heroin distribution, and/or firearm offenses in a case related to the attempted kidnapping of an individual because of an unpaid drug debt and are awaiting sentencing.

One remaining defendant charged in the case, Jonathan Benitez, remains a fugitive.

According to plea documents filed in the case, on July 12, 2016, Javier Martinez, along with co-defendants Jose Cardenas Aguirre and Melissa Trevino, planned to kidnap another individual because of an $800 unpaid drug debt involving cocaine. Prior to the planned kidnapping, Javier Martinez and Aguirre purchased rubber gloves, zip ties, and duct tape from Walmart. They wore ballistic vests and black camouflage clothing. In the attempt to kidnap the victim, Martinez and Cardenas Aguirre filed numerous shot into a home in Ennis. The kidnapping was ultimately unsuccessful, and as Javier Martinez, Aguirre, and Trevino fled the scene, they were engaged in a high-speed chase with officers with the Ennis Police Department. During this pursuit, Javier Martinez, using an AR-15 style rifle, fired numerous shots at a police officer. After their car was disabled, Martinez, Cardenas-Aguirre, and Trevino fled from police on foot. Cardenas Aguirre and Trevino were arrested following an eight-hour search. Martinez was apprehended several weeks later.

The case was investigated by the Ennis Police Department and the FBI’s Violent Gang Taskforce. Assistant U.S. Attorney P.J. Meitl prosecuted.

# # #

DALLAS — Twenty-three individuals, most from the Dallas, Texas, area, were charged in a federal indictment with offenses stemming from their respective roles in a methamphetamine distribution conspiracy this week, announced U.S. Attorney John Parker of the Northern District of Texas.

 

The indictment alleges the conspiracy began in January 2016 and continued to the date of the indictment, February 22, 2017. Count One of the indictment charges the following twenty-three defendants with conspiracy to possess with intent to distribute a controlled substance:

 

Roberto Omar Vera, 51, of Dallas, Texas

Kameron Paul Vera, 23, of Dallas, Texas

Roberto Trevizo Munoz, 19, of Dallas, Texas

Simon Louis Trevino, 30, of Dallas, Texas

Jorge Morales, 27, of Dallas, Texas

Kneely Denay Abadie, 23, of Arlington, Texas

Stephanie Jean Aldava, aka “Stephanie Jean Bradley,” Stephanie Jean May,” “Stephanie Jean Bristow,” 38, of Lufkin, Texas

Rodney Allen Broach, 48, of Kemp, Texas

Angela Danielle Burkham, 34 of Garland, Texas

Elizabeth Neely Causey-Eck, 47, of McKinney, Texas

Mark Allen Craven, 59, of Dallas, Texas

Lauren Allyson Crites, aka “Lauren Allyson Anderson,” 33, of Garland, Texas

Charley Seay Crossland, aka “Charley Denise Seay,” 37, of Dallas, Texas

Arthur Daniel Currie, aka “Aquaman,” 32, of Dallas, Texas

Caitlyn Taylor Johnson, 23, of Terrell, Texas

Chelsea Loraine Johnson, 24, of Terrell, Texas

Ilona Klonowshi King, aka “Ilona Klonowski Brazeal,” 46, of Dallas, Texas

Larry Ray Lincks, 52, of Quinlan, Texas

Daniel Moss, 31, of Mabank, Texas

John Craig Owen, 54, of Mesquite, Texas

Clisty Diane Pratt, aka “Clisty Diane Baker,” 44, of Kemp, Texas

Paul Wade Shreves, 27, Mesquite, Texas

Brandi Scott Turcola, aka “Brandi Scott Blackburn,” “Brandi Scott Smith,” 34, of Log Cabin, Texas

 

Each defendant was also charged with one count of possession with intent to distribute a controlled substance. Roberto Vera, Kameron Vera, and Larry Lincks were each charged with additional counts relating to the conspiracy.

 

An indictment is an accusation by a grand jury. A defendant is entitled to the presumption of innocence unless proven guilty. If convicted, the maximum penalty for the charged offenses is life in federal prison.

 

The Department of Public Safety and the Bureau of Alcohol, Tobacco, Firearms and Explosives led the investigation; Kaufman Police Department, Kaufman County Sheriff’s Office and Henderson County Sheriff’s Office assisted. Assistant U.S. Attorney P.J. Meitl is in charge of the prosecution.

 

# # #

AMARILLO — Pat Jarrett Helton, 43, of Amarillo, Texas, appeared in federal court yesterday and pleaded guilty before U.S. District Judge Sidney A. Fitzwater to one count of convicted felon in possession of a firearm, announced U.S. Attorney John Parker of the Northern District of Texas.

Helton faces a maximum statutory penalty of ten years in federal prison, and a $250,000 fine. Helton will remain on bond pending sentencing set for June 6, 2017. As part of the plea, Helton signed a forfeiture agreement waiving his right to a number of items seized, including $24,783 in currency, a 1992 Lamborghini Diablo, 2012 Kawasaki Ninja motorcycle, 2016 Polaris Razor, multiple vehicles and trailers.

According to documents filed in the case, on November 7, 2016, a federal search warrant was executed at Helton’s property in Mobeetie, Texas. The property included Helton’s residence and surrounding buildings. During the search, law enforcement agents located 91 firearms and large quantities of ammunition. The firearms included one shotgun with a barrel less than 18 inches, one semiautomatic rifle with a barrel of less than 16 inches, three stolen firearms, and at least four semiautomatic firearms that are capable of accepting large capacity magazines.

Before Helton possessed the 91 firearms, he had been convicted in 2003 of a felony offense for possession of a firearm not registered. Helton was sentenced to 46 months in federal prison.

The case was investigated by the Federal Bureau of Investigation, the Texas Department of Public Safety and the Bureau of Alcohol, Tobacco, Firearms and Explosives. Assistant U.S. Attorney Sean Taylor is in charge of the prosecution.

 

# # #

DALLAS — Two defendants who pleaded guilty to their roles in a pill mill operation they were involved in during parts of 2013-2014 have been sentenced.

U.S. Attorney John Parker announced that Taneisha Nickerson, 29, of Dallas, Texas, was sentenced last week to 24 months in federal prison, following her guilty plea in August 2016 to one count of unlawful use of a communication device. Co-defendant Adrian Banks, 23, of Dallas, was also sentenced last week to 20 months in federal prison. He pleaded guilty in August 2016 to the same offense.

In March 2015, a federal grand jury in Dallas indicted 23 individuals, including Nickerson and Banks, on offenses related to their participation in a prescription drug distribution conspiracy. That indictment alleged that from at least May 2013 through July 2014, the defendants participated in a scheme to illicitly obtain prescriptions for pain medications, such as oxycodone and hydrocodone, and then distribute those controlled substances for profit. As part of the conspiracy, individuals, often homeless or of limited means, were recruited and paid to pose as patients at medical clinics, including the McAllen Medical Clinic in Dallas, to obtain prescriptions to fill those prescriptions at designated pharmacies. Many of those defendants have pleaded guilty and are awaiting sentencing.

According to documents filed in the Nickerson case, on March 5, 2014, in a telephone call Nickerson agreed to deliver 225 oxycodone 30mg pills to one of co-conspirator Cornelius Robinson’s customers. Nickerson possessed the pills with the intent to distribute them at the time of the call.

According to documents filed in the Banks case, on February 26, 2014, Banks called co-conspirator Cornelius Robinson and told him that he was in Dallas “running patients” and wanted to know if a “patient” could use a green card to fill a prescription at a pharmacy. Robinson told Banks that he thought so because it is an identification card. Banks told Robinson that the prescriptions he had to fill that day were for Lorcet, Robinson told him that there was not a lot of money in Lorcet. Banks responded that he expected to be “running patients,” that is, filling prescriptions, for oxycodone, within two weeks.

 

The investigation is being conducted by the Drug Enforcement Administration, with assistance from the Internal Revenue Service, Texas Department of Public Safety, the Louisiana State Police, the Grand Prairie Police Department, the Dallas Police Department, the Houston Police Department, the Arlington Police Department, the Greenville Police Department, the Parker County Sheriff’s Office, the U.S. Marshal’s Service, the U.S. Postal Inspection Service, and the Diplomatic Security Service. Assistant U.S. Attorney Mary Walters is prosecuting.

 

# # #

 

 

DALLAS – An indictment returned by a federal grand jury in Dallas last week, and unsealed today, charges 16 individuals with offenses related to their participation in a health care fraud scheme, announced John Parker, U.S. Attorney for the Northern District of Texas.

The defendants charged are:

 

Bradley J. Harris, 35, of Frisco, Texas

Amy L. Harris, 42, of Frisco, Texas

Melanie L. Murphey, 35, of Fort Worth, Texas

Patricia B. Armstrong, 33, of Coppell, Texas

Mark E. Gibbs, 46, of Lindsay, Texas

Laila N. Hirjee, 50, of Plano, Texas

Syed M. Aziz, 51, of Frisco, Texas

Reziuddin Siddique, 63, of Allen, Texas

Charles R. Leach, 64, of Arlington, Texas

Jessica J. Love, 37, of Gainesville, Texas

Ali Rizvi, 49, of Carrollton, Texas

Tammie L. Little, 55, of Brashear, Texas

Mary Jaclyn Pannell, 29, of Krum, Texas

Taryn E. Stuart, 32, of Sanger, Texas

Slade C. Brown, 47, of Plano, Texas

Samuel D. Anderson, 35, of Carrollton, Texas

 

Each indicted defendant is charged with one count of conspiracy to commit health care fraud. Twelve of the defendants are also charged with at least one other count related to the conspiracy.

“That tens of millions of dollars were stolen through fraud is shocking enough,” said U.S. Attorney Parker. “That these defendants used human life at its most vulnerable stage as the grist for this scheme displays a shocking level of depravity that this community simply cannot tolerate.”

The indictment alleges that from July 2012 to September 2016, Novus billed Medicare and Medicaid more than sixty million dollars for fraudulent hospice services, of which more than thirty-five million dollars was paid to Novus. Specifically, defendants submitted false claims for hospice services, submitted false claims for continuous care hospice services, recruited ineligible hospice beneficiaries by providing kickbacks to referring physicians and healthcare facilities, and falsified and destroyed documents to conceal these activities from Medicare.

Novus Health Services and Optim Health Services, Inc. were operated and co-owned by Harris, who was a certified public accountant without any medical licenses. Harris operated the two companies essentially as one. Licensed physicians who were paid Novus medical directors provided little to no oversight of Novus’s hospice patients. Care was directed primarily by Novus nurses and by Harris. Defendants who were not physicians would determine whether a beneficiary would be certified for, recertified for, or discharged from hospice; whether they would be placed on continuous care; and how and to what extent they would be medicated with drugs such as morphine and hydromorphone. These decisions on medical care were often driven by financial interest rather than patient need. The defendants would decide whether to place, keep, or discharge a beneficiary from hospice depending on how that decision would affect Novus’s ability to bill Medicare.

Physicians were recruited who would refer hospice patients in exchange for medical director salaries. Assisted living facilities, in exchange for patient referrals, were provided remuneration including Certified Nursing Assistants paid for by Novus to staff the facilities.

Novus medical directors would sign certificates of terminal illness indicating that they had determined that a beneficiary was eligible for hospice services regardless of whether this was true or not; prepare re-certifications of terminal illness for beneficiaries already on hospice, which falsely indicated that the beneficiaries continued to be hospice eligible; and routinely give medical directors’ login information to others to log into Novus’s electronic medical records database to create and sign physician orders for services that had not been performed or had not been performed by the medical directors.

Harris would direct that beneficiaries be placed on continuous care, whether the beneficiaries needed this service or not. This decision would often be made without any consultation with a physician. Continuous care physician’s orders were falsified and uploaded into Novus’s electronic medical records database. When a beneficiary was on continuous care, the Novus nurses would administer high doses of Schedule II controlled medications such as morphine or hydromorphone, whether the beneficiary needed the medication or not. The defendants and others obtained these Schedule II medications with “C2” prescription forms (used for the prescription of controlled substances) which had been unlawfully pre-signed by medical directors. One reason for this aggressive medicating practice was that Harris wanted to ensure that the beneficiaries’ medical records contained documentation that would justify billing Medicare at the higher continuous care billing rate. There were instances when these excessive dosages resulted in serious bodily injury or death to the beneficiaries.

An indictment is merely an allegation and defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law. If convicted, however, each count of conspiracy to commit health care fraud and substantive health care fraud count carries a maximum statutory penalty of 10 years in federal prison and a $250,000 fine.

The case is being investigated by the Federal Bureau of Investigation, the U.S. Department of Health and Human Services (HHS) Office of Inspector General (OIG), and the Texas Attorney General’s Medicaid Fraud Control Unit (MFCU).

 

Assistant U.S. Attorney Russell Fusco is prosecuting the case.

 

# # #

AMARILLO, Texas — Joel Lara Merida, 31, arrested in August 2016 after a traffic stop in Potter County, Texas, and then found to have 17,388 grams of heroin in bundles in an aftermarket compartment, has been sentenced, announced U.S. Attorney John Parker of the Northern District of Texas.

 

On Monday, February 27, 2017, Merida was sentenced by U.S. District Judge Sidney A. Fitzwater to 51 months in federal prison. Merida pleaded guilty to one count of possession with intent to distribute one kilogram or more of heroin and aiding and abetting in November 2016. Co-defendant Jose Emmanuel Morales Rittingger, 29, is set to plea in March 2017.

 

According to documents filed in the case, on August 15, 2016, a Texas Department of Public Safety (DPS) Trooper stopped a 1995 BMW for driving in the left lane when not passing and obstructed view through the windshield. Upon making contact with the driver of the vehicle, who was later identified as Merida, and the passenger, who was later identified as Rittingger, the Trooper noticed indicators of possible criminal activity. The Trooper asked Merida for consent to search the vehicle and Merida voluntarily consented to the search. Eighteen bundles in an aftermarket compartment under the back seat were located. There were nine bundles wrapped in black tape, four bundles were wrapped in cellophane, and five bundles were wrapped in silver tape. The heroin had a gross weight of 44.26 pounds and field tested positive for the presence of heroin.

 

Subsequent testing confirmed that the substance seized was, in fact, heroin, a Schedule I controlled substance, with a net weight of approximately 17,388 grams.

 

The case was investigated by the Texas Department of Public Safety and the Drug Enforcement Administration. Assistant U.S. Attorneys Joshua Frausto and Sean Taylor prosecuted.

 

 

# # #

AMARILLO, Texas — Two defendants, who pleaded guilty in November 2016 to their respective roles in cocaine trafficking have been sentenced, announced John Parker, U.S. Attorney for the Northern District of Texas.

Yesterday, U.S. District Sidney A. Fitzwater sentenced Roberto Rodriguez, 32, to a 60-month term of imprisonment. Rodriguez pleaded guilty to one count of possession with intent to distribute 500 grams or more of cocaine and aiding and abetting. Co-defendant Emmanuel Hira Robles, 30, was sentenced to 71 months in federal prison. He also pleaded guilty to one count of possession with intent to distribute 500 grams or more of cocaine and aiding and abetting.

According to court documents, on August 11, 2016, a Texas Department of Public Safety Trooper stopped a SUV for speeding and following to close. The Trooper noticed that the driver, later identified as Robles, took an abnormal amount of time to stop once the Trooper initiated the traffic stop. Upon making contact with Robles and the passenger, who was later identified as Rodriguez, the Trooper noticed indicators of possible criminal activity.

 

While the Trooper was in the process of issuing Robles a warning for the two traffic violations, he noticed inconsistencies between Robles’ and Rodriguez’ stories about their trip. The Trooper asked Robles for consent to search his vehicle, and Robles refused. The Trooper then asked Robles and Rodriguez to wait on the roadside while he waited for a narcotics detection canine unit. The narcotics detection canine conducted a free-air sniff of Robles’ vehicle, and the canine alerted to the presence of narcotics in Robles’ vehicle. Based on the canine’s alert to the presence of narcotics, the Trooper searched the vehicle. During the search, the Trooper observed a carpeted box that, based on his training and experience, he knew to be used to smuggle narcotics and currency. Both Rodriguez and Robles were immediately handcuffed and placed under arrest. Robles told the Trooper how to open the compartment. Two bundles were located in the compartment. A field test of the substance in the bundles yielded a positive result for the presence of cocaine, a Schedule II controlled substance.

 

The suspected cocaine was confirmed to be cocaine with a net weight of 1,995 grams.

 

The Drug Enforcement Administration and Texas Department of Public Safety investigated. Assistant U.S. Attorney Joshua Frausto prosecuted the case.

# # #

AMARILLO, Texas — James Kenny Crawley, 60, of Amarillo, Texas, appeared today in federal court before U.S. District Judge Sidney A. Fitzwater and pleaded guilty to one count of possession of prepubescent child pornography, announced John Parker, U.S. Attorney for the Northern District of Texas.

Crawley, who is on bond, faces a maximum statutory penalty of 20 years in federal prison, a $250,000 fine and a lifetime of supervised release. Sentencing will be set at a later date.

According to documents filed in the case, Crawley used a laptop computer at his residence to search the Internet for images and videos of child pornography. In the course of searching for this material, Crawley located, downloaded and viewed approximately 5,000 images and over 100 videos constituting child pornography, and some of those images involved prepubescent minors engaging in sexually explicit conduct.

The case was brought as part of Project Safe Childhood, a nationwide initiative, which was launched in May 2006 by the Department of Justice, to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals, who sexually exploit children, and identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/. For more information about internet safety education, please visit http://www.justice.gov/psc/ and click on the tab “resources.”

The Ochiltree County Sheriff’s Office, Texas Rangers and Federal Bureau of Investigation investigated the case. Assistant U.S. Attorney Joshua Frausto is in charge of the prosecution.

# # #

FORT WORTH, Texas — This morning, U.S. District Judge Reed C. O’Connor sentenced three defendants, with ties to the Polywood Crips street gang in Fort Worth, Texas, for their respective roles in a child sex trafficking conspiracy, announced U.S. Attorney John Parker of the Northern District of Texas.

Chad Johnson, a/k/a “Ocho Hood Fame,” 24, was sentenced to 300 months in federal prison. He pleaded guilty to one count of sex trafficking of children in November 2016.

Deon Bonner, a/k/a “Spanish Fly,” 26, was sentenced to 360 months in federal prison. He pleaded guilty to one count of conspiracy to commit sex trafficking of children in November 2016.

Stanley Johnson, a/k/a “Pee Wee,” 24, was sentenced to 168 months in federal prison. He pleaded guilty to one count of conspiracy to commit sex trafficking of children in October 2016.

All three defendants received lifetime sex offender registration.

Co-defendants Audry Lane, a/k/a “Spud,” 29, Diwone Nobles, a/k/a “Pooh,” 32, Katelyn Micelle Ward, a/k/a “KD,” 24, Jessica Arnold, 23, Serrah Arnold, a/k/a “Kristen,” 28 and Alvin Lane, a/k/a “Spank,” 32, have also pleaded guilty to varies offenses relating to their roles in the conspiracy and are awaiting sentencing.

According to documents filed in the case, in November 2015, U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI) learned that a 16-year-old runaway, Jane Doe 1, was being trafficked by a group of people in Fort Worth, Texas; that group included the defendants. The investigation revealed that from approximately October 1, 2013, through April 16, 2016, the members of this group facilitated the commercial sex acts of several minor and adult females.

Nobles, Bonner, Chad Johnson, Stanley Johnson, Audry Lane and Alvin Lane, acted as pimps for the girls and women they trafficked. They instructed them on how much to charge and they kept proceeds from transactions. They also provided the girls and women with condoms, cellular phones and hotel rooms. Some of the members of the group bought and sold the girls and women they were trafficking amongst themselves.

To locate commercial sex customers, Nobles, Bonner, Chad Johnson, Stanley Johnson, Audry Lane and Alvin Lane facilitated the placement of advertisements on various commercial websites, including Backpage.com. In many instances, rather than placing the Backpage.com advertisement themselves, sisters Serrah Arnold and/or Jessica Arnold, who acted as “bottom girls,” were told to post the advertisements using Backpage.com accounts belonging to the Arnolds.

On approximately October 10, 2015, friends Deon Bonner and Stanley Johnson met 17-year-old Jane Doe 2 and her 16-year-old friend Jane Doe 1 in Fort Worth. They took the girls to a motel on Meacham Street in Fort Worth. Shortly thereafter, Stanley Johnson told Jane Doe 2 that he wanted her to engage in commercial sex acts, and he sought help from Audry Lane and Alvin Lane to post commercial sex ads for her on Backpage.com. Stanley Johnson told Jane Doe 2 how much to charge and he bought condoms for her; he also kept the money she made from engaging in commercial sex acts.

While Stanley Johnson was causing Jane Doe 2 to engage in commercial sex acts at a Fort Worth motel, Bonner was causing Jane Doe 1 to engage in commercial sex acts in another nearby room. After several days, Bonner left the hotel, and then Chad Johnson caused Jane Doe 1 to engage in commercial sex acts. Next, Nobles began causing Jane Doe 1 to engage in commercial sex acts. Chad Johnson and Nobles eventually took both Jane Doe 1 and Jane Doe 2 to another hotel in Fort Worth where Chad Johnson continued to cause Jane Doe 2 to engage in commercial sex acts.

When an adult female victim engaged in commercial sex acts at Chad Johnson’s direction, he physically assaulted her if she did not follow his instructions. On one occasion, Chad Johnson punched her in the ear hard enough to cause her eardrum to burst and bleed. Chad Johnson also raped her, and when he believed she had attempted to “renegade,” he had several friends gang rape her as punishment. “Renegade” is a term used to describe attempting to engage in commercial sex acts for money outside the knowledge or control of a pimp.

Some of the six pimp’s Facebook pages contained online posts, visible to the public, that reference making a lot of money through criminal activity, namely “pimping.” Chad Johnson’s Facebook page contained photos of him posing with large sums of cash while referencing commercial sex. Several of Chad Johnson’s Facebook friends were females observed in Backpage.com ads for commercial sex.

Nobles, Bonner, Chad Johnson, Stanley Johnson, and Audry Lane had several photos on their Facebook pages in which they can be observed flashing gang signs referencing the “Polywood Crips” street gang.

The Bureau of Alcohol, Tobacco, Firearms and Explosives, ICE HSI and the Fort Worth Police Department investigated. Assistant U.S. Attorney Cara Foos Pierce prosecuted.

# # #

LUBBOCK, Texas — Jerry Ba Nguyen, 24, of Las Vegas, appeared in federal court today and pleaded guilty, before U.S. Magistrate Judge D. Gordon Bryant, Jr., to interference with flight crew members and attendants, announced U.S Attorney John Parker of the Northern District of Texas.

Nguyen, who has been in custody since his arrest in September 2016, faces a maximum statutory penalty of 20 years in federal prison and a $250,000 fine. Sentencing will be set at a later date by U.S. Senior District Judge Sam R. Cummings.

According to plea documents filed in the case, on September 22, 2016 Nguyen was a passenger on American Airlines flight 2542 in route from Ontario, California, to Dallas/Fort Worth International Airport, which was diverted to Lubbock Preston Smith International Airport, after Nguyen, knowingly interfered and attempted to interfere with the performance of the duties of a flight crew member and flight attendant, lessening their ability to perform their duties, by assaulting and intimidating the flight attendant and flight crew member by refusing to comply with instructions from flight attendants.

Nguyen came to the attention of the flight attendants as the plane was leaving the gate in Ontario, appearing agitated and walking toward the front of the aircraft as it prepared to take off. Flight attendants were able to calm him down, and the plane departed. After takeoff, however, Nguyen’s erratic behavior continued; he mumbled that the SIM card had been stolen from his phone and he made suicidal statements. He also stated that the police were not his friends, and the U.S. government was responsible for the September 11, 2001, terrorist attacks.

Nguyen was asked to remain in his seat by the flight crew on multiple occasions, but refused. Flight attendants were so concerned about his behavior that they recruited several passengers to assist with physically restraining Nguyen if it became necessary.

Upon final approach, Nguyen walked to the front of the aircraft and was near the cockpit door. Flight attendants instructed Nguyen numerous times that he needed to be seated for landing, but Nguyen refused to take his seat. Due to Nguyen’s proximity to the cockpit door, the lead flight attendant signaled other passengers to subdue Nguyen.

The Captain declared an emergency and diverted the flight to Lubbock Preston Smith International Airport, where it landed safely. Nguyen was removed from the plane and taken into custody

The Federal Bureau of Investigation, the Transportation Security Administration, the Lubbock Police Department and the Lubbock International Airport Police Department are investigating the case. Assistant U.S. Attorney Jeffrey Haag is in charge of the prosecution.

# # #

DALLAS — A federal grand jury in Dallas returned an indictment yesterday charging Reyes Alvarez, 32, and Pedro Calixto, 27, both of Dallas, Texas with one count each of conspiracy to possess with the intent to distribute one kilogram or more of heroin, announced U.S. Attorney John Parker of the Northern District of Texas.

 

A date and time for their arraignments has not been set yet.

 

According to documents filed in the case, in January 2017, Alvarez and Calixto worked together to distribute large amounts of heroin in the Dallas area.

 

Specifically, on January 26, 2017, the investigation revealed Alvarez and Calixto drove to a gym, and while en route, Calixto received a call asking if he could sell a kilogram of heroin. Following several calls, Calixto agreed to deliver a kilogram of heroin. Calixto and Alvarez left the gymnasium and returned to an apartment at Kiest and Polk. A short time later, the two left the apartment and drove south toward the area of Red Bird Lane and South Polk Street. A Dallas County Sheriff’s Deputy stopped the vehicle occupied by Alvarez and Calixto for having an expired buyer’s license plate. Alvarez presented a fraudulent California Driver’s license, and the officer noted that the vehicle smelled of freshly burnt marijuana. The officers asked Alvarez and Calixto to step out of the vehicle. Officers searched the vehicle and found a kilogram of heroin under the passenger seat where Calixto had been seating. A field test of the heroin yielded a positive result for the presence of heroin.

 

A federal indictment is an accusation by a federal grand jury, and a defendant is entitled to the presumption of innocence unless proven guilty. If convicted, however, each count in the indictment carries a mandatory minimum sentence of 10 years and a maximum penalty of life imprisonment and 10,000,000 fine.

 

The matter is being investigated by the Drug Enforcement Administration and the Dallas Police Department. Assistant U.S. Attorney Suzanna Etessam is in charge of the prosecution.

 

# # #

LUBBOCK, Texas — Christopher Lee Gonzalez, aka “Gonzo,” 43, was sentenced today by Senior U.S. District Judge Sam R. Cummings to 327 months in federal prison, following his guilty plea in October 2016 to his role in a methamphetamine, cocaine and marijuana distribution conspiracy, announced U.S. Attorney John Parker of the Northern District of Texas.

Twelve individuals were arrested and charged with similar federal offenses, stemming from their respective roles in a drug distribution conspiracy that operated in West Texas. Of those arrested, each defendant has pled guilty. Two defendants remain fugitives.

According to plea documents filed in the case, on October 4, 2015, Gonzales distributed and possessed with the intent to distribute 50 grams or more of methamphetamine. The investigation revealed that late that morning, Gonzalez and co-conspirator Jasmine Pilar Hernandez traded multiple calls and text messages discussing a drug transaction that was going to occur later that day. At approximately 10:10 a.m., Hernandez told Gonzales that “the old man that brings it ... was on his way.” The “old man that brings it” was subsequently identified as co-defendant Belizario Salas-Avenado. Salas remains a fugitive.

 

Agents established surveillance on Salas’ residence located in Levelland, Texas. At approximately 1:30 p.m., a 2001 Chevrolet Suburban left the residence and traveled to the United Supermarket in Levelland, Texas. Salas purchased a box of Gain laundry detergent and a six­ pack of beer. Salas then returned to his residence.

 

At approximately 3:13 p.m., Hernandez told Gonzales, “In 25 minutes, he’ll be here.” Agents observed Salas and two unknown males leave Salas’ residence in the 2001 Chevrolet Suburban and head toward Lubbock, Texas. At approximately 3:30 p.m., a Texas Department of Public Safety Trooper stopped the 2001 Chevrolet Suburban, driven by Salas for traffic violations. Salas was arrested for no driver’s license. Salas stated that the two passengers where his nephews. The rear seat passenger was seated next to a white laundry basket and a box of Gain detergent which appeared to have been tampered with. When the trooper opened the box of detergent, a white plastic bag, containing a crystal-like substance was partially concealed in the detergent.

 

At approximately 4:05 p.m., Gonzales told Hernandez, “call me when they get there and I’ll go by.” At approximately 4:41 p.m., Hernandez indicated she had tried to call “them people ... twice.” At approximately 8:30 p.m., Gonzales advised Hernandez, “They got um,” referring to the arrest of Salas.

 

On October 5, 2015, Gonzales instructed Hernandez, “Do not tell nobody... about them getting caught....” “If they asked what happened ... that you still haven’t got nothing. That they ran out or something, you know. Don't tell them that they got caught up, man.”

 

The Texas Department of Public Safety and the DEA investigated. Assistant U.S. Attorneys Juanita Fielden and Sean Long prosecuted.

 

# # #

LUBBOCK, Texas — This morning, Senior U.S. District Judge Sam R. Cummings sentenced Richard Jasso, 39, of San Angelo, Texas, to life in federal prison, following a federal jury conviction on one count of distribution and possession with intent to distribute 50 grams of more of methamphetamine and aiding and abetting, announced U.S. Attorney John Parker of the Northern District of Texas.

The government filed a notice of enhancement because Jasso has two previous “felony drug offenses.” The Court found those convictions were final and valid, then, by statute, the Court imposed a life sentence, without parole.

Jasso was convicted at trial in November 2016 and has been in custody since his arrest on July 13, 2016. Twelve defendants were charged in an indictment, most from the San Angelo area, and were arrested in a joint Organized Crime Drug Enforcement Task Force (OCDETF) operation led by the Drug Enforcement Administration (DEA), the Texas Department of Public Safety, and the San Angelo Police Department. The indictment charged various felony offenses stemming from their respective roles in a methamphetamine distribution conspiracy that operated in San Angelo.

The government presented evidence at trial that Jasso delivered 54 net grams of pure methamphetamine to an individual working at the direction of the Drug Enforcement Administration. The buy took place in San Angelo.

With Jasso’s sentence, all 12 defendants charged in the indictment have been sentenced to the following federal prison sentences:

Rudolfo Ledesma Castaneda, Jr., 31, 360 months
Nancy Ann Flores, 41, 15 months
Adam Gabriel Castaneda, 30, 10 years
Daniel Roy Lombrana, 29, 87 months
Jesse Huerra, 31, Life
Antonio N. Flores, 52, 70 months
Bruno Rudolfo Velasquez, 32, 60 months
Joe Lopez, III, 33, 125 months
Jose G. Montez, 38, 151 months
Shayna Kaye McCann, 24, 10 months

The charges were dismissed against Silvia Prado, 36, of Austin, Texas.

The DEA, Bureau of Alcohol, Tobacco, Firearms and Explosives, Texas Department of Public Safety and the San Angelo Police Department investigated the case.

Assistant U.S. Attorney Jeffrey Haag prosecuted.

# # #

LUBBOCK — Two Lubbock residents who pleaded guilty to methamphetamine trafficking conspiracy charges were sentenced today by Senior U.S. District Judge Sam R. Cummings, announced U.S. Attorney John Parker of the Northern District of Texas.

Jonathan Lovato, 34, was sentenced to two 480-month sentences in federal prison, to run concurrently, and Crystal Ann Alaniz, 33, was sentenced to 60 months in federal prison. Each pleaded guilty in November 2016 to one count of possession with intent to distribute 50 grams or more of methamphetamine and aiding and abetting. Lovato pleaded guilty to an additional charge of possession of a firearm in furtherance of a drug trafficking crime and aiding and abetting.

Co-defendants Arleen Theres Keithley, 36, Juan Carlos Lara-Ochoa, 24, and Jose Alberto Cibrian, 41, pleaded guilty to their roles in the conspiracy and are awaiting sentencing.

 

According to the factual resume filed in the case, on March 17, 2016, officers with the Lubbock Police Department conducted an undercover narcotics purchase from a hotel room in Lubbock and were watching the room to monitor traffic to and from the location while a search warrant was obtained. During this surveillance, officers saw the main target of the investigation, Lovato, arrive in a silver sedan and begin to take items from the hotel room. Lovato attempted to leave the hotel in his vehicle and, when officers tried to detain him, he sped away. He evaded officers for several blocks, driving in excess of the speed limit, against oncoming traffic, and through several traffic-controlled intersections without observing the traffic signals. Lovato’s vehicle was stopped when he struck several other vehicles as he drove against oncoming traffic into a busy street intersection. One of the individuals in a vehicle he struck sustained life-threatening injuries and was pronounced dead at the scene.

 

As officers approached Lovato’s vehicle, they discovered he had a 9mm caliber pistol in his waistband. A package containing a substance, later verified as 118.13 grams of methamphetamine, was found in the glove box and five cell phones were found throughout the vehicle. Lovato admitted he possessed the firearm and admitted to selling methamphetamine.

 

According to documents filed in the case, on April 30, 2016, a trooper with the Texas Department of Public Safety (DPS) stopped a vehicle in Lubbock for traffic violations. Keithley was the driver; Alaniz was the passenger. Keithley was arrested for driving with an invalid license, and Alaniz, who had several outstanding warrants, was also placed under arrest.

 

Both Keithley and Alaniz were placed in the trooper’s vehicle. The in-car video recording system captured Keithley maneuver her hands—while handcuffed—to her left breast area and force a substance in a plastic bag out of her bra. Keithley then used her teeth to remove the item from her bra and toss it to the back seat area where Alaniz was seated. Alaniz hid the item in her pants. Both women were transported to the Lubbock County Detention Center. When asked if either was in possession of any contraband, Alaniz initially stated, “no,” before admitting “I have stuff on me.” Alaniz was searched and two plastic bags containing suspected methamphetamine were found in her pants. Alaniz was also in possession of two plastic bags that contained several smaller plastic bags with markings consistent with narcotics trafficking.

 

The Texas DPS Crime Lab determined that the suspected methamphetamine was in fact methamphetamine, and it weighed a total of 54.93 grams.

 

The Lubbock Police Department, the Littlefield Police Department, the Texas Department of Public Safety and the Bureau of Alcohol, Tobacco, Firearms and Explosives investigated. Assistant U.S. Attorney Sean Long prosecuted.

 

# # #

WASHINGTON – A Texas resident was sentenced to serve 22 months in prison today for preparing false tax returns, announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and U.S. Attorney John R. Parker for the Northern District of Texas.

 

According to documents filed with the court, Lourdes Ramirez, a Mexico national unlawfully residing in the United States, operated TX ASAP Tax Services and Fiesta Tax Service located in Greenville. From 2011 through 2014, Ramirez prepared approximately 1,163 federal tax returns that included fraudulent business income, losses, credits and deductions and sought refunds to which her clients were not entitled. Ramirez intended to cause a tax loss of approximately $1,155,383.

 

In addition to the term of prison imposed, Ramirez was ordered to serve one year of supervised release and to pay $128,958.85 in restitution to the Internal Revenue Service (IRS) by District Judge Ed Kinkeade. Judge Kinkeade also ordered Ramirez removed from the United States to Mexico following her sentence.

 

Acting Deputy Assistant Attorney General Goldberg and U.S. Attorney Parker commended special agents of IRS-Criminal Investigation, who conducted the investigation, and Trial Attorneys Alexander Effendi and Melanie Smith of the Tax Division, who prosecuted the case.

 

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

 

# # #

A Texas resident was sentenced to serve 22 months in prison today for preparing false tax returns, announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and U.S. Attorney John R. Parker for the Northern District of Texas.

 

According to documents filed with the court, Lourdes Ramirez, a Mexico national unlawfully residing in the United States, operated TX ASAP Tax Services and Fiesta Tax Service located in Greenville. From 2011 through 2014, Ramirez prepared approximately 1,163 federal tax returns that included fraudulent business income, losses, credits and deductions and sought refunds to which her clients were not entitled. Ramirez intended to cause a tax loss of approximately $1,155,383.

 

In addition to the term of prison imposed, Ramirez was ordered to serve one year of supervised release and to pay $128,958.85 in restitution to the Internal Revenue Service (IRS) by District Judge Ed Kinkeade. Judge Kinkeade also ordered Ramirez removed from the United States to Mexico following her sentence.

 

Acting Deputy Assistant Attorney General Goldberg and U.S. Attorney Parker commended special agents of IRS-Criminal Investigation, who conducted the investigation, and Trial Attorneys Alexander Effendi and Melanie Smith of the Tax Division, who prosecuted the case.

 

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

DALLAS, Texas — Jose Luis Martinez-Martinez, 41, of Desoto, Texas, made his initial appearance last week before U.S. Magistrate Judge Paul D. Stickney on a complaint, unsealed today, charging possession with intent to distribute, announced U.S. Attorney John Parker of the Northern District of Texas.

 

Judge Stickney ordered that Martinez remain in federal custody. A preliminary hearing will be set at a later date.

 

According to the affidavit filed with the criminal complaint, the investigation began when the Drug Enforcement Administration (DEA) received information that Martinez-Martinez was involved in the distribution of kilogram quantities of heroin in the Dallas metroplex. An undercover officer contacted Martinez-Martinez by cellular phone and placed an order for three kilograms of heroin. Martinez-Martinez agreed to supply the officer with the three kilograms of heroin and they agreed to meet at Flying J Truck stop located at 7425 Bonnie View Road, Dallas, Texas. Dallas County Sherriff’s officers performed a traffic stop on Martinez-Martinez as he arrived at the Flying J Truck stop. During the traffic stop officers observed a small gift style bag with an open top sitting in the front right passenger seat. Also observed in plain view was a black tar like substance inside the bag believed to be heroin. Martinez-Martinez was then placed under arrest. During an interview, Martinez-Martinez stated that he had an additional 2.5 kilograms of heroin concealed at his residence located at Desoto, Texas. During a search of the residence investigators recovered an additional 3,042.3 grams of heroin.

 

A federal criminal complaint is a written statement of the essential facts of the offense charged, and must be made under oath before a magistrate judge. A defendant is entitled to the presumption of innocence until proven guilty. The U.S. Attorney’s office has 30 days to present the matter to a grand jury for indictment. The penalty for the charged offense is not less than 10 years or up to life in federal prison and a $10 million fine.

 

The matter is being investigated by the Drug Enforcement Administration. Assistant U.S. Attorney Rachael Jones is in charge of the prosecution.

 

 

# # #

DALLAS — A 31-year-old Dallas, Texas, man, Rafael Almeida Zapata, who pleaded guilty in August 2016 to one count of transporting and shipping child pornography, was sentenced this morning by U.S. District Judge Sidney A. Fitzwater to 188 months in federal prison, announced U.S. Attorney John Parker of the Northern District of Texas.

According to documents filed in the case, in June 2015, Dallas Police Department executed a search warrant at the residence of Zapata in Dallas, Texas. Officers showed Zapata still images of a child pornography video downloaded from an IP address through the ARES peer-to-peer file sharing program. The IP address was linked to Zapata and he admitted that he recognized the still images from a child pornography video he downloaded through ARES. Zapata also admits to possessing more than 600 images of child pornography, some of the images depicted sadistic and masochistic content involving children.

The case was brought as part of Project Safe Childhood, a nationwide initiative, which was launched in May 2006 by the Department of Justice, to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals, who sexually exploit children, and identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/. For more information about internet safety education, please visit http://www.justice.gov/psc/ and click on the tab “resources.”

The Federal Bureau of Investigation and Dallas Police Department investigated. Assistant U.S. Attorney Camille Sparks prosecuted.

# # #

FORT WORTH, Texas —Pedro Jose Meza, 35, of Fort Worth, Texas, was sentenced today by U.S. District Judge Terry R. Means to serve a total of 50 years in federal prison and a lifetime of supervised release, following his guilty plea to two child pornography offenses, announced U.S. Attorney John Parker of the Northern District of Texas.

Meza has been in custody since his arrest on a related federal criminal complaint in early November 2015. He pleaded guilty in July 2016 to one count of production of child pornography and one count of distribution of child pornography.

According to the factual resume filed in the case, in June 2014 Meza knowingly did employ, use, persuade and induce a six-year-old minor to engage in sexually explicit conduct for the purpose of producing a visual depiction of the conduct. Meza produced the image at a Fort Worth home he was living at with the minor child and her mother.

On a separate occasion in October 2015 Meza used the internet and the Kik messaging application to distribute a one minute, thirty-one second video of an adult male engaging in sexual intercourse with a prepubescent female.

Meza was approached at his work in Fort Worth, Texas by Homeland Security Investigations agents on November 5, 2015 in connection with a child pornography investigation. Meza acknowledged that he had traded child pornography using Kik messaging.

These cases were brought as part of Project Safe Childhood, a nationwide initiative launched in 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals, who sexually exploit children, and identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/. For more information about internet safety education, please visit http://www.justice.gov/psc/ and click on the tab “resources.”

 

Homeland Security Investigations conducted the investigation. Assistant U.S. Attorney Aisha Saleem prosecuted the case.

 

# # #

DALLAS — Noah Bradley Lester, 64, of Farmers Branch, Texas was sentenced today by U.S. District Judge Jane Boyle to serve a total of 262 months in federal prison, following his guilty plea in April 2016 to two counts of bank robbery, announced U.S. Attorney John Parker of the Northern District of Texas.

According to documents filed in the case, on April 17, 2015 Lester entered the BB&T Bank located at 3550 Forest Lane in Dallas, Texas, wrote a demand note then left the bank when approached by bank personnel, leaving the note behind. Lester next entered the Capital One Bank located at 2903 Forest Lane, Dallas, Texas. Lester handed the teller a note demanding money and then lifted his shirt so the teller could see an airsoft pistol in his waistband. The teller, scared and in fear for her life, complied with the demand and provided Lester with cash. After securing the money, Lester left the bank. He was arrested later that same day as he arrived home.

Lester also pleaded guilty in 1993 in the Northern District of Texas to one count of bank robbery and was sentenced in August 1993 to serve 300 months in federal prison. At the time of these April 2015 bank robberies, Lester was on supervised release on that offense. Today, Judge Boyle sentenced Lester to 262 months on the bank robbery offenses and 36 months for violating his supervised release, to be served concurrently.

The Federal Bureau of Investigation investigated the case. Assistant U.S. Attorney Keith Robinson was in charge of the prosecution.

# # #

LUBBOCK, Texas — Sidney Caleb Lanier, 36, of Lubbock, Texas, pleaded guilty this morning before U.S. Magistrate Judge D. Gordon Bryant Jr. to one count of conspiracy to distribute and possess with intent to distribute fentanyl, announced U.S. Attorney John Parker of the Northern District of Texas.

 

Lanier faces a statutory sentence of not more than 20 years in federal prison and a $1 million fine. Judge Bryant recommended that the district court accept Lanier’s guilty plea. If the district court accepts the plea, it will order a presentence investigation report with a sentencing date to be set after the completion of the report. Lanier has been in custody since his arrest in October 2016 following a law enforcement operation led by Lubbock Police Department and special agents with the Drug Enforcement Administration focused on the distribution in the Lubbock area of the highly potent synthetic opioid, fentanyl. Fentanyl is responsible for a sharp increase in opioid deaths across the U.S. It poses a high risk of death not only to users, but also to law enforcement personnel.

 

While fentanyl can serve as a direct substitute for heroin in opioid-dependent individuals, it is a dangerous substitute as it is 50 times more potent than heroin and results in frequent overdoses that can lead to respiratory depression and death. Cheaper than heroin, fentanyl can be ingested, inhaled or absorbed through the skin; just a few milligrams, equivalent to a few grains of table salt, may be deadly.

 

Two additional defendants charged in the case, Jessica Christine Holl, 28, and Jamie Marie Robertson, 32, are scheduled for trial on April 3, 2017.

 

According to documents filed in this case, from approximately January 2013 to October 27, 2016 on Lanier, Holl, and Robertson did knowingly and intentionally combine, conspire, confederate and agree with each other and with persons known and unknown to knowingly and intentionally distribute and possess with intent to distribute a mixture and substance containing a detectable amount of fentanyl, a Schedule II controlled substance. Lanier admits to supplying Holl and Robertson with large amounts of Fentanyl he purchased online on the Darknet from China using Bitcoin, a digital currency. The Fentanyl was shipped to various addresses in the Lubbock area, prepared by the defendants and sold for use.

 

The case is being investigated by the Lubbock Police Department and the Drug Enforcement Administration. Assistant U.S. Attorney Jeff Haag is in charge of the prosecution.

 

 

# # #

DALLAS — Following a three-day trial before U.S. District Judge David C. Godbey, a federal jury has convicted Martavious Detrel Banks Keys, 33, on felony child sex trafficking offenses, announced U.S. Attorney John Parker of the Northern District of Texas.

Specifically, the jury convicted Keys, a/k/a “Cheese” and “Matt,” on two counts of child sex trafficking and one count of sex trafficking through force, fraud or coercion. Keys faces a statutory penalty of not less than 15 years and up to life in federal prison, and up to a lifetime of supervised release. He must also register as a lifetime sex offender. Sentencing is set for June 5, 2017 before Judge Godbey.

According to documents filed in his case, from approximately March 15, 2015, through April 18, 2015, Keys recruited, enticed, harbored, transported, provided, obtained or maintained two minor females, 15-year-old Jane Doe 1 and 14-year-old Jane Doe 2, causing them to engage in commercial sex acts. In addition, he used force, fraud or coercion to cause Jane Doe 1 to engage in commercial sex acts.

Specifically, Keys placed commercial sex advertisements on Backpage.com for Jane Doe 1 and Jane Doe 2. As a result of the Backpage advertisements, the two minor females engaged in numerous commercial sex acts at Keys’ direction. Keys would negotiate with “clients” over text messages pretending to be the minor females. Jane Doe 1 and Jane Doe 2 worked out of Keys’ residence. In addition, Jane Doe 1 also saw commercial sex clients at various hotels in the Dallas area. Jane Doe 1 and Jane Doe 2 engaged in numerous sex acts a day, sometimes even up to sixteen per day. Keys, who was unemployed, kept all of the proceeds from the commercial sex acts; purchasing various items with the money, including a Chevrolet Tahoe with aftermarket rims.

Keys sexually assaulted and physically assaulted both Jane Doe 1 and Jane Doe 2 during the ordeal. In addition, he threatened Jane Doe 1 with a gun, and threatened both girls with harm if they did not continue to engage in commercial sex acts.

Members of the North Texas Trafficking Taskforce, including the Mesquite Police Department, Department of Public Safety (Garland), Homeland Security Investigations, the Bureau of Alcohol, Tobacco, and Firearms and Child Protective Services investigated. Assistant U.S. Attorneys Cara Foos Pierce and Myria Boehm prosecuted the case.

# # #

FORT WORTH, Texas — James VanBlaricum, 77, of Colleyville, Texas, appeared in federal court this morning before U.S. Magistrate Judge Jeffrey L. Cureton and pleaded guilty to one count of mail fraud, announced U.S. Attorney John Parker of the Northern District of Texas.

VanBlaricum, who operated Signal Oil and Gas Company (SOG) and Texas Energy Management, which later became Texas Energy Mutual (TEM), has been in custody since his arrest in mid-August 2016. Sentencing is set for June 13, 2017.

According to plea documents, VanBlaricum formed SOG and TEM, ostensibly for the purpose of investing in mineral leases, and oil and gas production and earning a profit from those investments. VanBlaricum ran the fraud scheme from approximately January 2007 to August 2016, from office locations in Grapevine, Texas and Bedford, Texas, as well as from his residence and home office located in Colleyville, Texas where many of the acts and transactions alleged in the indictment took place. VanBlaricum raised millions of dollars from investors by various means, including selling securities in the form of joint ventures in “programs” offered by SOG and TEM.

VanBlaricum employed sales agents who worked on his behalf to raise money, by selling limited partnership interests in these “programs” offered by SOG and TEM. Both personally and through investors, VanBlaricum deceived investors and potential investors by misrepresenting material facts. For example, he represented that investors would earn an “assured” rate of return on their initial investment, and they would receive a full refund of their initial investment amount after a defined period of time. He also represented that he intended to use a certain percentage of investors’ money to purchase mineral leases, and oil and gas well projects, when in fact, he intended to spend a substantially smaller percentage on the leases and oil and gas well projects and use a substantial part of investors’ money for purposes they did not authorize or even know about, including paying purported investment returns to other investors, commissions to sales agents, and paying his personal expenses as well as personal expenses for family members, friends, and business associates.

VanBlaricum also represented that he had purchased certain assets, or was in the process of purchasing them, when in fact, he had not purchased the assets and was not in the process of purchasing them. He also represented that the oil and gas well projects were productive and profitable, when in fact, most were “dry holes,” produced oil for a short period of time, or had not been drilled.

When VanBlaricum made promises about the use of investor funds, he failed to state that he had made the same promises to other investors and then used those investors’ funds for purposes they did not authorize or even know about, including paying purported investment returns to other investors, commissions to sales agents, and payment of personal expenses for VanBlaricum and his family, friends, and business associates.

VanBlaricum, according to plea documents, identified himself to investors using a false name. VanBlaricum deposited investors’ funds into, and withdrew and expended investors’ funds, from accounts he controlled in the names of entities he controlled. He caused funds to be transferred to, withdrawn from, and deposited into various accounts to create the appearance of business operations and revenue that he knew did not exist. He also caused “lulling” payments to be paid to investors, ostensibly as returns on investment, when he knew the funds came from other investors rather than from business operations.

VanBlaricum secretly, and without authorization, took and spend money entrusted to him by investors for advertising; vacations and international travel; rent payments; automobile purchases; and payroll and commissions for employees and sales agents.

The U.S. Postal Inspection Service with assistance from U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI) investigated. Assistant U.S. Attorney Douglas A. Allen is in charge of the prosecution.

# # #

DALLAS — Kevin Kenard Howard of Dallas, Texas, was sentenced today by U.S. District Judge Jane J. Boyle to serve 30 months in federal prison and pay $1,850,000 in restitution following his guilty plea in May 2016 to a felony offense stemming from his work with co-defendant Ellis Wamsley, IV and the FAIM Economic Development Corporation, announced U.S. Attorney John Parker of the Northern District of Texas.

Specifically, Howard, 34, pleaded guilty to one count of wire fraud and aiding and abetting. Judge Boyle ordered that he surrender to the Bureau of Prisons on April 26, 2017.

Co-defendant Wamsley, 47, of Grand Prairie, Texas, pleaded guilty in May 2016 to one count of engaging in a monetary transaction with property derived from specified unlawful activity and aiding and abetting and. Wamsley was sentenced to 54 months in federal prison and ordered to pay $1,850,000 in restitution in October 2016.

According to documents filed in the case, Wamsley formed FAIM in 2003, and in 2010, as its CEO, hired Howard to work as a financial consultant to assist in recruiting investors for FAIM. In summer 2010, while trying to recruit these investors to supply additional cash revenue for FAIM, Howard and Wamsley recruited “M.R.,” the owner/operator of “Company R,” in Flower Mound, Texas. They advised M.R. that a proposed joint venture between FAIM and Company R would generate funding for FAIM economic development projects in the southern sector of Dallas and throughout the U.S.

In August 2010, M.R. wired $2 million to a FAIM brokerage account at Charles Schwab. Approximately one month later, Wamsley transferred $1,791,703 in Company R’s investment funds from that account to a FAIM Merrill Lynch brokerage account that he had established and to which M.R. did not have access.

Wamsley told Howard that Howard would be FAIM’s primary point of contact with M.R. After the first few trades, the joint venture began to lose money. Wamsley told Howard to hide the investment losses from M.F. Howard agreed to, and did, lie to M.R. about the trading losses and the true balance of the investment account.

Howard knowingly participated in the fraud scheme by sending lulling emails to M.R. that contained false information about the true balance and value of the account. In November 2010, Howard sent an email to M.R. falsely assuring M.R. that profits in the investment account had increased. In December 2010, Howard sent an email to M.R. in which he falsely represented that the account balance was $2,436,611. In January 2011, Howard sent another email saying the total account balance was $2,500,000. In fact, from October 2010 to August 2011, Howard, at Wamsley’s instruction, sent several emails to M.R. with the specific intent to deceive, mislead and confuse M.R. about the account’s true balance. Wamsley and Howard also concealed that fact that Wamsley was diverting some of the funds in the account for his own personal benefit and use.

For instance, from October 2010 through April 2012, Wamsley fraudulently transferred more than $1.7 million of Company R investment funds to FAIM’s business accounts, and he unlawfully spent those funds for his, Howard’s and others’ personal benefits. For example, in November 2010, Wamsley used $40,024 in Company R investment funds to purchase a 2008 Cadillac Escalade for Howard; $41,764 of investment funds to purchase a 2008 Cadillac Escalade for a family member; and $125,477 in investment funds to purchase a 2007 Aston Martin for himself. Wamsley also used more than $200,000 in investment funds to host a Super Bowl fund-raising event in 2011.

This case is one of several felony prosecutions of bankruptcy-related crimes generated by the Bankruptcy Fraud Initiative in the Northern District of Texas. This defendant is the 16th defendant convicted since August 2013 as part of that initiative.

 

Internal Revenue Service Criminal Investigation investigated the case. Assistant U.S. Attorney David Jarvis was in charge of the prosecution.

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FORT WORTH, Texas — Seven defendants, including members and associates of the Aryan Brotherhood of Texas prison gang, who were convicted in September 2016 following a four-day jury trial for their roles in a methamphetamine distribution conspiracy that operated in north Texas from approximately January 2014 to April 2016 were sentenced this week by U.S. District Judge John McBryde. U.S. Attorney John Parker of the Northern District of Texas made today’s announcement.

 

Each of the below-listed defendants was convicted on one count of conspiracy to possess with intent to distribute methamphetamine and received the following federal prison sentences:

 

Charles Ben Bounds, a/k/a “Pretty Boy,” 31, of Fort Worth, Texas, 360 months
Billy Fred Gentry, a/k/a “Fred Gentry,” 30, of Fort Worth, Texas, 360 months

Kevin Kyle Killough, a/k/a “Kilo,” 29, of Fort Worth, Texas, LIFE

Billy Ray Skaggs, 48, of Brownwood, Texas, 300 months

Michael Clay Heaslet, a/k/a “Whisper,” 38, of Fort Worth, Texas, LIFE

Nicole Cynthia Herrera, a/k/a “Nikki Single,” 21, of Dallas, Texas, 300 months

Trae Short, a/k/a “Twig,” 31, of Dallas, Texas, LIFE

 

The government presented evidence at trial that some of the defendants were members, including ranking members, or associates, of the Aryan Brotherhood of Texas. The government presented further evidence identifying the defendants and the role of each in the conspiracy. Many of the defendants had numerous prior convictions.

 

The Drug Enforcement Administration (DEA), Homeland Security Investigations (HSI), the Fort Worth Police Department, the Texas Department of Public Safety (DPS), and the Bureau of Alcohol, Tobacco, and Firearms (ATF) investigated. Assistant U.S. Attorneys Shawn Smith and Frank Gatto prosecuted the case.

 

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DALLAS — A Dallas, Texas, woman, Glenda Faye Hendrix, 50, was sentenced this afternoon by U.S. District Judge Jane J. Boyle to 60 months in federal prison, following her guilty plea in March 2016 to one count of bank robbery.

Hendrix admitted robbing four banks, entering each of the banks with the intent to commit bank robbery. She acted similarly in each robbery, entering the bank and handing a note to the teller demanding that they give her all of their money.

Hendrix committed the following bank robberies:

     October 14, 2015       Comerica Bank, 2727 Fort Worth Avenue, Dallas, Texas

     October 23, 2015       BBVA Compass Bank, 2307 W. Illinois Avenue, Dallas, Texas

     November 9, 2015     Chase Bank, 3929 South Polk Street, Dallas, Texas

     November 25, 2015    First Convenience Bank, 200 Short Blvd., Dallas, Texas

The Federal Bureau of Investigation and Dallas Police Department investigated. Assistant U.S. Attorney Andrew Wirmani prosecuted.

 

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DALLAS — Devin Patrick Lessig, has been sentenced by U.S. District Judge Sam A. Lindsay to serve a total of 18 years in federal prison following his guilty plea in April 2016 to an indictment charging one federal felony drug offense, announced U.S. Attorney John Parker of the Northern District of Texas.

Specifically, Lessig, 25, of Dallas, pleaded guilty to one count of possession with intent to distribute a controlled substance. According to the factual resume filed in the case, in June 2015, a Texas Department of Public Safety State Trooper attempted to initiate a traffic stop on a motorcycle on Dallas Parkway in Dallas County. The motorcycle, operated by Lessig, failed to stop and a pursuit occurred. After crashing the motorcycle, Lessig was arrested and the motorcycle was confirmed stolen out of New York. During a search of the suspect's backpack, Lessig was found to be in possession of approximately one hundred ten grams of a crystal like substance that was submitted for laboratory analysis. The substance tested positive for methamphetamine. Approximately fourteen grams of a black tar substance believed to be heroin, seven pills believed to be ecstasy, a black Glock 27 .40 caliber pistol and other drug paraphernalia were also located.

 

Additionally, in August 2015, Addison Police Officers located a stolen motorcycle in the Motel 6 parking lot off Belt Line Road, Addison, TX. While conducting surveillance on the stolen motorcycle, Addison police officers observed Lessig exit a room carrying a black backpack. Addison police officers prevented Lessig from departing the parking lot by blocking the motorcycle in. While blocking the motorcycle in, Lessig jumped off of the motorcycle and fled on foot through the Motel 6 parking lot. As Lessig was running, he discarded the black backpack in the parking lot near the room where he had recently exited. Addison police officers secured the discarded black backpack and the stolen motorcycle. Addison police officers eventually apprehended and detained Lessig a couple blocks away from the Motel 6.

Addison police officers searched the black backpack previously discarded by Lessig and found an AK-47 assault pistol with a pistol grip attached to the front, two loaded pistols and ammunition, prescription medication, a pill bottle containing 88 tablets of suspected 3,4-Methylenedioxy Methamphetamine, and a Tupperware container full of suspected methamphetamine. Addison police officers recovered another pistol in the immediate area of where Lessig was apprehended, believed to have been discarded by Lessig as he fled the location. The substance was ultimately submitted for laboratory analysis and it was found to be methamphetamine.

 

The Texas Department of Public Safety, Addison Police Department and Dallas Police Department investigated the case. Assistant U.S. Attorney George Leal was in charge of the prosecution.

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