Northern District of Texas

 DALLAS — A former American Airlines employee who admitted to her role in transporting a substance that was represented to be cocaine on flights from Dallas-Fort Worth International Airport (DFW) was sentenced today to a lengthy federal prison sentence, announced U.S. Attorney John Parker of the Northern District of Texas.

Janelle Isaacs, 42, was sentenced by U.S. District Judge Jane J. Boyle to 72 months in federal prison following her guilty plea in June 2016 to one count of conspiracy to possess with intent to distribute and distribute at least five kilograms or more of cocaine.  Isaacs has been in custody since mid-July 2015 following a law enforcement operation, led by the Federal Bureau of Investigation, the Dallas Police Department and Internal Revenue Service Criminal Investigation, in which numerous defendants were arrested on drug distribution conspiracy and related charges outlined in a federal superseding indictment returned by a federal grand jury in Dallas the previous month.

That superseding indictment charged Janelle Isaacs, Funaki Falahola, 35, Moniteveti Katoa, 53, Molitoni Katoa, 34, with the cocaine distribution conspiracy offense. All four defendants pleaded guilty to the offense. In September 2016, Moniteveti Katoa was sentenced to 188 months and Molitoni Katoa was sentenced to 90 months in federal prison. In November 2016, Funaki Falahola was sentenced to 240 months in federal prison. 

According to documents filed in the case, the four used their positions of employment at DFW, or contacted a person or persons who had a position or positions of employment at DFW, to bypass security in order to transport kilogram quantities of a substance that was represented to be cocaine, in what they did not know was an undercover law enforcement operation.  As part of the conspiracy, that ran from approximately April 18, 2013, through July 14, 2015, the substance that was represented to be cocaine was transported on commercial airlines flying from DFW to destinations in Las Vegas, Nevada; Newark, New Jersey; Phoenix, Arizona; Chicago, Illinois; Wichita Kansas; and San Francisco, California.

Isaacs admits she became suspicious that Moniteveti Katoa, her husband, was transporting some sort of controlled substance via commercial airlines around 2013 when he asked her if she could provide him information on where law enforcement officers were seated on airplanes. Despite Isaacs’ suspicion she admits to helping Moniteveti Katoa with his flight arrangements and air travel.

Moniteveti Katoa asked Isaacs to perform a “dry run” with a legal substance called “kava” so that she could build up her courage to cross a bag that contained what she believed to be cocaine. Isaacs performed at least one dry run in order to prepare her to bypass security.

On December 8, 2014, Moniteveti Katoa went to DFW Airport and met with Isaacs. Isaacs took a backpack that was provided by Moniteveti Katoa towards the TSA checkpoint, walked towards the employee portal, bypassed security, and then later provided that same backpack to Moniteveti Katoa so that he could fly, what she and Moniteveti Katoa believed was 3 kilograms of something illegal, to a destination in Kansas and deliver it for payment.

The FBI, Dallas Police Department and Internal Revenue Service Criminal Investigation led the investigation with assistance from the Texas Department of Public Safety; the DFW Department of Public Safety; the U.S. Department of State; the Drug Enforcement Administration; the Bureau of Alcohol, Tobacco, Firearms and Explosives; the Transportation Security Administration; the U.S. Secret Service; U.S. Immigration and Customs Enforcement’s Enforcement and Removal Operations; and the Fort Worth, McKinney, Mesquite, and Plano Police Departments.

Assistant U.S. Attorney George Leal is in charge of the prosecution.

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FORT WORTH, Texas —Jose Luis Cepeda Cortes, 60, one of the Mexican citizens convicted for his role in the May 2013 murder of Juan Jesus Guerrero Chapa in Southlake, Texas, was sentenced yesterday, announced U.S. Attorney John Parker of the Northern District of Texas.

Cepeda Cortes was sentenced by Senior U.S. District Judge Terry R. Means to two life sentences plus 240 months to run concurrent. Cepeda Cortes was convicted at trial in May 2016 on one count of interstate stalking, one count of conspiracy to commit murder for hire and one count of tampering with documents or proceedings. 

Co-defendant Jesus Gerardo Ledezma-Cepeda, a/k/a “Chuy” and “Juan Ramos,” 60, also a Mexican citizen, was also convicted at trial in May 2016 on one count of interstate stalking and one count of conspiracy to commit murder for hire. Each offense carries a maximum statutory penalty of life in federal prison and a $250,000 fine.  Sentencing is scheduled for December 6, 2016.

Ledezma-Cepeda’s son, Jesus Gerardo Ledezma-Campano, 33, was sentenced by Senior U.S. District Judge Terry R. Means to 20 years in federal prison on August 18, 2016.  Ledezma-Campano pleaded guilty in March 2016 to one count of interstate stalking and testified for the government at trial.

On May 22, 2013, at approximately 6:47 p.m., Juan Jesus Guerrero Chapa was ambushed and shot multiple times with a 9mm pistol while seated in his Range Rover that was parked at Southlake Town Square.  A Toyota Sequoia pulled up behind the Range Rover, a gunman got out of that vehicle, walked up to the Range Rover, and fired several times through the window at Mr. Chapa, who died at the scene.  Nearby, Mr. Chapa’s wife was not harmed.

According to evidence presented at trial and documents filed in the case, from approximately March 1, 2011, until May 22, 2013, the three defendants traveled in interstate and foreign commerce from Mexico to Southlake, and elsewhere, with the intent to kill, injure, harass and intimidate Mr. Chapa, and as a result of that travel, Mr. Chapa was killed.  In addition, from approximately May 23, 2013, until September 5, 2014, Cepeda-Cortes took steps to destroy evidence on his computer related to the investigation.

The defendants were acting on orders from a man in Mexico, Rodolfo Villarreal Hernandez, known as “El Gato,” or “the Cat,” who wanted Mr. Chapa killed as revenge for his father’s murder.  Over the course of the conspiracy, Ledezma-Campano and Ledezma-Cortes received money from Ledezma-Cepeda to pay for their expenses.  Ledezma-Cepeda was paid by “El Gato.”

Ledezma-Cepeda asked his son, Ledezma-Campano, to assist in the search.  Ledezma-Campano used his skill with electronic devices to assist in the search, and he created email accounts for Ledezma-Cepeda and “El Gato” to communicate with each other.

The defendants exchanged information via email to locate Mr. Chapa – exchanging personal information about Mr. Chapa and his family as well as information regarding vehicles associated with them and photographs of the Chapa residence in Southlake.

The defendants used various means to locate and track Mr. Chapa and members of his family.  Cepeda-Cortes purchased surveillance cameras that were placed in various locations in Mr. Chapa’s neighborhood.  In addition, while in the area, the defendants purchased and rented several vehicles that allowed them to frequently change vehicles and use non-descript rental vehicles to avoid detection by Mr. Chapa and his family.  They placed automobile tracking devices not only on their own vehicles, but on vehicles owned and operated by Mr. Chapa and his relatives, including the Range Rover Mr. Chapa was in when he was murdered.

After the defendants located Mr. Chapa, “El Gato” sent two assassins from Mexico to Southlake to kill him.  Ledezma-Campano met the two, whom he identified as “Clorox” and “Captain,” and concluded they were sent to kill Mr. Chapa.  One of the men was, in fact, the gunman who killed the victim on May 22, 2013, and the other drove the Toyota Sequoia.

On the day of the murder, Ledezma-Campano and Ledezma-Cepeda followed the victim around Southlake, and that afternoon, while the victim’s Range Rover was parked in a Walmart parking lot, Ledezma-Campano and Ledezma-Cepeda switched the tracking device on the Range Rover. 

At approximately 6:00 p.m. on May 22, 2013, Mr. Chapa and his wife drove to Southlake Town Square.  Ledezma-Campano and Ledezma-Cepeda, who had been parked near Chapa’s home, followed them.  Mr. Chapa parked in his regular parking spot near a yogurt store, and Ledezma-Campano and Ledezma-Cepeda parked directly across from them and used binoculars to watch them.

As they waited, Ledezma-Cepeda was in regular contact, via Blackberry Messenger, with “El Gato.”  Ledezma-Campano saw “Clorox” and “Captain” drive by in a Toyota Sequoia.  Ledezma-Campano went into a coffee shop in Town Square and while inside he heard a commotion outside.  He returned to Ledezma-Cepeda who told him “they shot him”

Ledezma-Campano and Ledezma-Cepeda waited several minutes as law enforcement responded before leaving the scene.  “El Gato” told both of them to stop using the tracking device they carried in their vehicle.  The next morning, they returned the rental car and drove directly into Mexico, along the way destroying the phones they had used.

The investigation was led by the FBI and the Drug Enforcement Administration, with assistance from the Southlake Police Department, Bureau of Alcohol, Tobacco, Firearms and Explosives, US. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI), U.S. Customs and Border Protection, Texas Department of Public Safety, Tarrant County Sheriff’s Office, Tarrant County District Attorney’s Office, Fort Worth Police Department and Grapevine Police Department.

Assistant U.S. Attorneys Joshua Burgess and Aisha Saleem are prosecuting the case.

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LUBBOCK, Texas — Today, Dequan Deshawn Willard, 22, of Lubbock, Texas, appeared before U.S. Magistrate Judge D. Gordon Bryant and pleaded guilty to one count of conspiracy to distribute and possess with intent to distribute cocaine base and one count of possession of a firearm in furtherance of a drug trafficking crime, announced U.S. Attorney John Parker of the Northern District of Texas.  Willard faces a statutory penalty of not less than five years or more than 40 years in federal prison and a $4 million fine for the conspiracy charge and a statutory penalty of no less than five years and up to life and a $250,000 fine for the firearm charge.

Yesterday, three co-conspirators: William Emmanuel Spence, 27, Jasmine Jamal Spence, 28, and Antonio Deon Ray Montgomery, 21—all brothers—each pleaded guilty before Judge Bryant to one count of conspiracy to distribute and possess with intent to distribute cocaine and cocaine base.  All three defendants face a statutory penalty of not less than five years or more than 40 years in federal prison and a $4 million fine.

Judge Bryant ordered presentence reports for each of the defendants with sentencing dates to be set after the completion of those reports.

According to documents filed in the case, the defendants are either confirmed or suspected members of the Crips criminal street gang in Lubbock.

As part of a joint investigation by U.S. Immigration and Customs Enforcement (ICE), Homeland Security Investigations (HSI), and the Lubbock County Sheriff’s Office, law enforcement executed a search warrant at a residence on East 1st Place Street in Lubbock on June 16, 2016, where officers had made a controlled purchase from co-defendant Dequan Willard a few days earlier.  Willard was present during the search in which officers recovered approximately 40 grams of cocaine base.

In September 2016, officers conducted several controlled purchases of cocaine base from Jasmine and William Spence.  On October 4, 2016, officers executed search warrants at four residences in Lubbock related to the investigation. 

Antonio Montgomery was arrested at a residence on East Cornell and he directed officers to where the cocaine base was kept in the house and officers recovered approximately 110 grams of cocaine base.  Montgomery advised the residence belonged to William Spence.  Officers also found items associated with the production and sale of cocaine base as well as a loaded firearm.

William Spence was located at a residence on 40th Street.  He had $1,379 in cash on his person and $15,020 in cash in a shoe box in the garage.  Officers also located a case matching the firearm found at the East Cornell location.

Officers also searched a location on Knoxville Street in Lubbock known to be the residence of Dequan Willard and William Spence.  Dequan Willard was arrested at the residence and a loaded firearm was located in the bed where he had been sleeping.  In a shoe box with the name “Tucc”—Willard’s street name—written on the side, officers found approximately 427 grams of cocaine.  Officers also found another bag in the residence that contained 427 grams of cocaine and also located $8,900 cash in William Spence’s bedroom.  Inside of a red pickup truck parked at the residence, officers recovered an additional 84 grams of cocaine; Willard had been observed driving this pickup and his mail was found in the truck.  Officers also located an additional 997 grams of cocaine in a Chevrolet Impala at the residence.  Inside the vehicle, officers located documents belonging to William Spence and photos depicting both William and Jasmine Spence.

Jasmine Spence was arrested at a residence on 69th Street, where officers located approximately 40 grams of cocaine base in a kitchen drawer and an additional eight grams of cocaine base in sock in Jasmine Spence’s bedroom.  Officers also discovered $7,410 in cash in the residence as well as a loaded handgun.        

ICE, HSI, and the Lubbock County Sheriff’s Office are conducting the investigation.  Assistant U.S. Attorney Sean Long is in charge of the prosecution.           

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DALLAS — Evetta Galloway Griffin, 49, of Grand Prairie appeared this morning before U.S. District Judge Jane J. Boyle and pleaded guilty to theft or bribery concerning programs receiving Federal funds.  U.S. Attorney John Parker of the Northern District of Texas made today’s announcement.

Griffin faces a maximum statutory penalty of 10 years in federal prison and a $250,000 fine. According to the plea agreement, Griffin agrees to restitution arising from her conduct to victims or the community. Sentencing is set for March 16, 2017.

According to documents filed in the case, Griffin, a/k/a Evette Griffin, was the Director of Facilities and Administration for the Child Care Group (CCG) until late March 2015.  The CCG is a non-profit corporation that receives federal grant funding to provide, among other things, Head Start services to promote the school readiness of young children from low-income families in the Dallas area.  Together, Head Start and Early Head Start programs support the comprehensive development of children from birth to age five, in centers, child care partner locations and in their own homes. 

Griffin had many duties at CCG that were related to the operation of their child care centers, as well as other responsibilities related to the administration of the corporate office and the procurement process related to federal grants. 

As part of the scheme, Griffin created and executed an embezzlement, theft and fraud scheme in which she fraudulently billed CCG for fictitious printing services allegedly provided by A-1 Express Co or A-1 Express Inc.  In fact, between April 25, 2011 and January 30, 2015, Griffin submitted approximately 100 fraudulent invoices to CCG that they paid.  Griffin usually converted the checks that were made payable to A-1 Express Co or A-1 Express Inc. to cash, ultimately receiving approximately $115,000 from her embezzlement scheme.

The case was investigated by the U.S. Department of Health and Human Services (HHS) Office of Inspector General (OIG).  First Assistant U.S. Attorney Chad Meacham is in charge of the prosecution.

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DALLAS — Founders and investors of the physician-owned Forest Park Medical Center (FPMC) in Dallas, other executives at the hospital, and physicians, surgeons, and others affiliated with the hospital, have been charged in a federal indictment, returned by a grand jury in Dallas last month and unsealed today, with various felony offenses stemming from their payment and/or receipt of approximately $40 million in bribes and kickbacks for referring certain patients to FPMC.  The announcement was made this afternoon by U.S. Attorney John Parker of the Northern District of Texas.

FPMC was an out-of-network hospital.  According to the indictment, the referred patients were primarily ones with high reimbursing out-of-network private insurance benefits or benefits under certain federally-funded programs.  FPMC’s owners, managers, and employees also attempted to sell patients with lower reimbursing insurance coverage, namely unwitting Medicare and Medicaid beneficiaries, to other facilities in exchange for cash.  As a result of the bribes, kickbacks, and other inducements, from 2009 to 2013, FPMC billed such patients’ insurance plans and programs well over half of a billion dollars and collected over $200 million in paid claims.

The below-listed defendants are charged in the indictment:

                        Alan Andrew Beauchamp, 64, of Dallas
                        Richard Ferdinand Toussaint, Jr., 58, of Dallas
                        Wade Neal Barker, 51, of Dallas
                        Wilton McPherson Burt, 61, of Costa Rica
                        Andrea Kay Smith, 37, of Rockwall, Texas
                        Carli Adele Hempel, 40, of Plano, Texas
                        Kelly Wade Loter, 48, of Dallas
                        Jackson Jacob, 53, of Murphy, Texas
                        Douglas Sung Won, 45, of Dallas
                        Michael Bassem Rimlawi, 45, of Dallas
                        David Daesung Kim, 54, of Southlake, Texas
                        William Daniel Nicholson IV, 46, of Dallas
                        Shawn Mark Henry, 46, of Fort Worth, Texas
                        Mrugeshkumar Kumar Shah, 42, of Garland, Texas
                        Gerald Peter Foox, 69, of Tyler, Texas
                        Frank Gonzales Jr., 41, of Midland, Texas
                        Israel Ortiz, 49, of Dallas
                        Iris Kathleen Forrest, 56, of Dallas
                        Andrew Jonathan Hillman, 40, of Dallas
                        Semyon Narosov, 51, of Dallas
                        Royce Vaughn Bicklein, 44, of San Antonio, Texas

“Medical providers who enrich themselves through bribes and kickbacks are not only perverting our critical health care system, but they are committing a serious crime,” said U.S. Attorney John Parker. “Massive, multi-faceted schemes such as this one, built on illegal financial relationships, drive up the cost of healthcare for everyone and must be stopped.”

 

“The charges announced today show that the government will not tolerate corrupt practices by medical providers motivated by greed,” said Dallas FBI Special Agent in Charge Thomas M. Class, Sr. “The FBI will continue to work with our law enforcement partners to identify those who manipulate and defraud our healthcare system and to seek their prosecution.”

 

“The Defense Criminal Investigative Service (DCIS), in partnership with our federal law enforcement partners, will continue to aggressively investigate those who defraud the federal government, and ultimately the American taxpayers, in order to protect the integrity of federal health care programs,” said Special Agent in Charge Janice M. Flores of the DCIS Southwest Field Office.  “Fraud and abuse by healthcare providers poses a significant threat to the viability of government health care programs, and today’s arrests demonstrate the commitment of DCIS and it partners in rooting out health care fraud and to hold those accountable for their actions.”

 

“I would like to acknowledge and thank our OIG criminal investigators, and their law enforcement partners, for their tireless efforts in pursuing this case,” said OPM Deputy Inspector General Norbert E. Vint.  “Their fine work protects the Federal Employees Health Benefits Program from those who would manipulate the health care system in order to steal taxpayer dollars.”

 

"An important mission of the Office of Inspector General is to investigate allegations relating to fraud involving the Federal Employees' Compensation Act. We will continue to work with out law enforcement partners to investigate these types of allegations," stated Steven Grell, Special Agent-in-Charge of the Dallas Regional Office of the United States Department of labor, Office of Inspector General.

 

"The allegations against the defendants in this indictment indicate that patient trust was broken by the payments of kickbacks and bribes used to induce surgeons to use their hospital to perform services," said Special Agent in Charge Tamera Cantu. "IRS Criminal Investigation, along with our law enforcement partners, will vigorously pursue corporate owners and managers that use their company to violate laws, including healthcare regulations."

 

FPMC was founded by Beauchamp, Toussaint, Barker, Burt, and others as an out-of-network hospital; as such, it was free to set its own prices for services and was generally reimbursed at substantially higher rates than in-network providers.  FPMC’s strategy was to maximize profit for physician investors by refusing to join the networks of insurance plans for a period of time after its formation, allowing its owners and managers to enrich themselves through out-of-network billing and reimbursement.

 

Toussaint and Barker co-owned FPMC; Beauchamp and Burt managed it.  Beauchamp was FPMC’s Chief Operating Officer and was an investor in FPMC.  Toussaint, an anesthesiologist, was the President of FPMC’s board of directors.  Barker, a bariatric surgeon, was on FPMC’s board of directors.  Burt was a Managing Partner of FPMC and was also an investor in FPMC.

FPMC’s referral coordinator, Smith, owned a shell entity known as Unique Healthcare that the coconspirators created to funnel bribe and kickback payments to surgeons in exchange for those individuals referring patients to FPMC.  Smith tracked surgeries and referrals so surgeons and referral sources could receive “credit.”  Another FPMC employee, Hempel, was FPMC’s Director of Bariatric Services; she led efforts to sell Medicare and Medicaid referrals from certain coconspirators to a non-FPMC facility.

Jacob owned a shell entity known as Adelaide Business Solutions that he and others used to funnel bribe and kickback payments to surgeons, primary care physicians, chiropractors, lawyers, worker’s compensation preauthorization specialists, and others in exchange for those individuals referring patients to FPMC or to surgeons who used the hospital’s facilities to perform certain medical procedures, including surgeries.  Another company, Entity A, co-owned by Toussaint and Barker, was a commercial real estate group that provided commercial real estate services to FPMC and was used by the coconspirators as a conduit for bribe and kickback payments.  Loter owned an advertising agency that received bribe and kickback payments on behalf of physicians. 

According to the indictment, two bariatric surgeons, Kim and Nicholson, investors in FPMC, received $4,595,000 and $3,400,000, respectively, in bribe and kickback payments in exchange for referring their patients to FPMC.  Three spinal surgeons, Won, Rimlawi, and Henry, also received bribe and kickback payments in exchange for referring their patients to FPMC.  The indictment alleges that Won received $7,000,000 and Rimlawi received $3,800,000 in bribe and kickback payments.  Henry was also an investor in FPMC.  The surgeons spent the vast majority of the bribe payments marketing their personal medical practices, which benefitted them financially, or on personal expenses, such as cars, diamonds, and payments to family members.

Other physicians who received bribe and kickback payments in exchange for referring patients to FPMC or to surgeons who performed medical procedures, including surgeries, at the hospital include Shah, a pain management doctor; Gonzales, a chiropractor who received approximately $385,000 in bribes and kickbacks; and Foox, who owned an orthopedic clinic in Tyler, Texas, and received approximately $500,000 in bribes and kickbacks. 

Forrest, a worker’s compensation preauthorization specialist, received approximately $450,000 in bribe and kickback payments in exchange for referring patients, including those she was preauthorizing, to FPMC or to surgeons who performed medical procedures, including surgeries, at the hospital.  Bicklein was a worker’s compensation lawyer who received approximately $100,000 in bribe and kickback payments in exchange for referring patients, including his clients, to FPMC or to surgeons who performed medical procedures, including surgeries, at the hospital. 

Ortiz owned a clinic that received approximately $1,100,000 in bribe and kickback payments for referring its patients to FPMC or to surgeons who performed medical procedures, including surgeries, at the hospital,

Collectively, Hillman and Narosov controlled a hospital consulting company, and they received approximately $190,000 in bribe and kickback payments in exchange for referring patient to FPMC or to surgeons who performed medical procedures, including surgeries, at the hospital.

According to the indictment, as part of the conspiracy, certain coconspirators also paid bribes and kickbacks of $500 per month to approximately 40 primary care physicians and practices to refer patients to the hospital or to surgeons associated with the hospital.  In addition to paying surgeons and primary care physicians, certain coconspirators also paid a host of others, including FECA beneficiaries, workers’ compensation preauthorization specialists, lawyers, businesses, runners, and chiropractors.  Certain coconspirators also “rented” space in doctors’ and chiropractors’ offices in outlying cities, including Foox’s clinic in Tyler, and clinics in Midland and Odessa, Texas, in exchange for patients being referred to FPMC or to surgeons who performed medical procedures at the hospital.

The bribes and kickbacks resulted in victim plans and programs being billed well over half of a billion dollars, including more than $10 million to the Department of Defense healthcare program TRICARE, more than $25 million to the Department of Labor FECA healthcare program, and more than $60 million to the federal employees’ and retirees’ OPM FEHBP healthcare program, and FPMC collecting more than $200 million in tainted and unlawful claims.

Each of the 21 defendants is charged with one count of conspiracy to pay and receive health care bribes and kickbacks; the maximum statutory penalty upon conviction is five years in federal prison and a $250,000 fine.

Beauchamp is charged with 10 counts of offering or paying and soliciting or receiving illegal remuneration, in violation of the federal Anti-Kickback Statute, and aiding and abetting.  Toussaint, Barker, and Burt are each charged with five counts of this offense.  Jacob is charged with eight, Shah with three, Rimlawi with two, and Won, Kim, Nicholson, Gonzales, and Forrest each with one count of this offense.  The maximum statutory penalty upon conviction is five years in federal prison and a $25,000 fine.

Beauchamp is also charged with seven counts of violating the federal Travel Act and aiding and abetting.  Jacob is also charged with six counts of this offense; Toussaint, Barker, Burt, and Jacob are also each charged with four counts of this offense; Foox is also charged with two counts of this offense; and Won, Kim, Nicholson, Henry, and Gonzales are also each charged with one count.  The maximum statutory penalty upon conviction is five years in federal prison and a $250,000 fine.

Beauchamp, Toussaint, Barker, and Burt are also each charged with two counts of conspiracy to commit money laundering.  Jacob and Henry are also each charged with one count of this offense.  The maximum statutory penalty upon conviction is 20 years in federal prison and a $250,000 fine.

The indictment also includes a forfeiture allegation that would require the defendants, upon conviction, to forfeit to the U.S. any property, real or personal, which constitutes or is derived from proceeds traceable to the offenses.  Restitution could also be ordered.

An indictment is an accusation by a federal grand jury, and a defendant is entitled to the presumption of innocence unless proven guilty.

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 — Leonard James McMorris, of Rayville, Louisiana, was sentenced this morning by Chief U.S. District Judge Barbara M. G. Lynn to 30 months in federal prison and ordered to pay $1,417,903 in restitution, following his guilty plea in March 2016 to his role in a conspiracy to commit wire fraud, announced U.S. Attorney John Parker of the Northern District of Texas.

McMorris, 50, and co-conspirator, Constance Marie Kelly, 53, were indicted in February 2009 on the conspiracy and several substantive counts of wire fraud.  McMorris was eventually arrested in the Western District of Louisiana in August 2015, and has remained in custody since his arrest.  Kelly was never arrested and remains a fugitive.

According to plea documents filed in his case, from approximately 2002 to 2007, McMorris and Kelly conspired to commit an extensive fraudulent scheme.  During this period, Kelly worked for LandAmerica American Title Company (American Title), a title insurance agent engaged in title insurance transactions for real estate closings.  As part of her duties, she had access to funds deposited in the American Title escrow account at Compass Bank. 

At various times in 2006 and 2007, as part of the scheme McMorris opened several business bank accounts at banks in Texas, including Bank of America, N.A., Bank One, N.A., Bank of Texas, N.A., and Compass Bank.  During the conspiracy, Kelly used at least 11 checks and 51 wire transfers to fraudulently disburse approximately $1,417,904 of American Title escrow funds into several bank accounts in Texas that McMorris controlled.  Kelly concealed from American Title that she made these unauthorized and fraudulent transfers to McMorris.

The Dallas FBI investigated the case.  Assistant U.S. Attorney David Jarvis is in charge of the prosecution.

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FORT WORTH, Texas — Diwone Nobles, a/k/a “Pooh,” 32, appeared before U.S. District Judge Reed C. O’Connor earlier this week and pleaded guilty to a child sex trafficking conspiracy, after jury selection began announced U.S. Attorney John Parker of the Northern District of Texas.

Nobles, who acted as a pimp, faces a minimum statutory penalty of 10 years and a maximum statutory penalty of life in federal prison, lifetime sex offender registration, lifetime supervised release and a $250,000 fine.  Sentencing is set for March 20, 2017.

A total of nine defendants were charged in the case, all of whom are members of affiliates of the Polywood Crips in Ft. Worth.  Five defendants were charged in the indictment with Nobles:  Chad Johnson, a/k/a “Ocho Hood Fame,” 24, Audry Lane, a/k/a “Spud,” 29, Deon Bonner, a/k/a “Spanish Fly,” 26, Stanley Johnson, a/k/a “Pee Wee,” 24, and Katelyn Michelle Ward, a/k/a “KD,” 24.  Audry Lane, Bonner and Stanley Johnson each pleaded guilty to one count of conspiracy to commit child sex trafficking.  Chad Johnson pleaded guilty to one count of sex trafficking of children, and Ward pleaded guilty of using a facility of interstate commerce in aid of a racketeering enterprise.  Last month, three others involved in the conspiracy, Alvin Lane, a/k/a “Spank,” 34, Serrah Arnold, 28, and Jessica Arnold, 23, who were charged in a felony Information pleaded guilty.  Alvin Lane pleaded guilty to one count of conspiracy to commit sex trafficking of children; Serrah and Jessica Arnold each pleaded guilty to one count of use of a facility of interstate commerce in aid of a racketeering enterprise.

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 numerous minor and adult females.

Nobles, Bonner, Chad Johnson, Stanley Johnson, Audry Lane, Katelyn Ward 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 member 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, Katelyn Ward, 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 and Jessica Arnold, who acted as “bottom girls,” were told to post the advertisements using Backpage.com accounts belonging to the Arnolds. 

On approximately June 1, 2013, 17-year-old Jane Doe 4 was introduced to Audry Lane, Serrah and Jessica Arnold, and Alvin Lane by a family friend of the Arnolds, defendant Katelyn Ward.  Ward asked the Lanes and Arnolds to teach Jane Doe 4 how to engage in commercial sex acts.  Serrah and Jessica Arnold explained to Jane Doe 4 about Backpage.com and how to talk to commercial sex customers.  Ward, along with Audry Lane, and later Alvin Lane, acted as Jane Doe 4’s pimp at various times between 2013 and 2015.  All three pimps knew she was 17 when they began facilitating her commercial sex acts, and they kept the proceeds she earned.  Various members of the group posted Jane Doe 4 on Backpage.com and facilitated her commercial sex acts.

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.  Stanley Johnson and Nobles eventually took both Jane Doe 1 and Jane Doe 2 to another hotel in Fort Worth where Stanley Johnson continued to cause Jane Doe 2 to engage in commercial sex acts.

According to documents filed in the case, one adult female victim engaged in commercial sex acts at the direction of Nobles, Chad Johnson, Audry Lane, Alvin Lane, and Serrah Arnold during 2014.  Nobles frequently assaulted her when she made him angry or did not follow his instructions; he also raped her.  Nobles kept the money she earned and the contact phone number used in the Backpage.com ad for her services was used by Nobles.   In one trip to Austin, this adult female victim made enough money for Nobles to buy a Chevy sedan that he painted bright orange – “Poly Orange” in reference to their neighborhood Polytechnic Heights – that he still owns.

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. 

When an adult female victim engaged in commercial sex acts at Audry Lane’s direction, he would have Serrah Arnold, his “bottom girl,” supervise the victim and take the money she received. 

A minor female victim engaged in commercial sex acts at the direction of Audry Lane, Alvin Lane, Serrah Arnold and Jessica Arnold.  Alvin Lane would have his girlfriend/bottom girl, Jessica Arnold post photos of her in ads that she placed on Backpage.com.  The minor female victim would give all the money she earned to Jessica or Serrah Arnold, who would then give the money to Audry Lane or Alvin Lane.

Some of the 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.  Likewise, Diwone Nobles posted numerous videos and photos on Facebook instructing others on how to pimp, and showing him counting money with various sex trafficking victims.

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 the case.  Assistant U.S. Attorney Cara Foos Pierce is in charge of the prosecution.                      

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DALLAS — Kevin Troy Jernigan, who owned a tax preparation business in Dallas, was sentenced today by U.S. District Judge David C. Godbey to 36 months in federal prison and ordered to pay more than $112,000 in restitution, following his guilty plea in July 2016 to one count of aiding or assisting in the preparation or presentation of a false or fraudulent individual income tax return, announced U.S. Attorney John Parker of the Northern District of Texas.

Jernigan was taken into custody when he entered his guilty plea to the tax offense because of committing multiple violations of his pretrial release.

According to the factual resume filed in the case, since 2007, Jernigan was the owner and a return preparer at The Parks 11 located in Dallas.  During tax years 2007 through 2012, Jernigan prepared and filed more than 1,300 tax returns that contained false and inflated deductions and credits which were intended to produce a fraudulently inflated refund to be paid by the IRS. The fraudulently income tax returns caused a tax loss of approximately $2,250,780 to the United States Treasury.

The factual resume further states that in January 2010, Jernigan prepared and filed with the IRS a 2009 tax return on behalf of taxpayer, “CJ.”  In preparing and electronically filing that tax return, Jernigan included $27,019 as a Schedule C business loss. Jernigan knew CJ had not incurred the business loss reflected. As a result of the false deduction inserted by Jernigan, the refund was fraudulently inflated to $5,819 and resulted in a tax loss in the amount of $6,432.

IRS Criminal Investigation investigated the case.  Assistant U.S. Attorney Christopher Stokes was in charge of the prosecution.

# # #

DALLAS – A Dallas woman who was among those charged last year as part of a nationwide sweep led by the Medicare Fraud Strike Force for her alleged participation in Medicare fraud schemes pleaded guilty today, announced U.S. Attorney John Parker of the Northern District of Texas.

 

Myrna S. Parcon, a/k/a “Merna Parcon,” 63, pleaded guilty to one count of conspiracy to commit health care fraud.  She faces a statutory penalty of up to 10 years in federal prison and a fine of up to $250,000 or twice the pecuniary gain to the defendant or loss to the victim.  Restitution may also be ordered.  In addition, according to the plea agreement, she will be excluded from Medicare, Medicaid and all federal health care programs.

 

Last week, two of Parcon’s co-defendants, Oliva A. Padilla, 57, of Garland, Texas, and Ben P. Gaines, 56, of Plano, Texas, pleaded guilty to a conspiracy count, and each faces a maximum statutory penalty of five years in federal prison and a $250,000 fine.

 

Co-defendants Ransome N. Etindi, 56, of, Waxahachie, Texas, pleaded guilty earlier this year to conspiracy to commit health care fraud; he faces a maximum statutory penalty of 10 years in federal prison and a fine of up to $250,000 or twice the pecuniary gain to the defendant or loss to the victim.   Lita S. Dejesus, 70, of Allen, Texas, pleaded guilty to a conspiracy count and faces a maximum statutory penalty of five years in federal prison and a $250,000 fine.  The one defendant charged in the case who has not pleaded guilty, Noble U. Ezukanma, 57, a physician from Fort Worth, Texas, is set to go to trial in January 2017, before U.S. District Judge Jane J. Boyle. 

 

According to documents filed in the case, from approximately January 2009 through June 9, 2013, Parcon and the other five defendants conspired to defraud Medicare by making materially false and fraudulent representations and promises in connection with health care services, namely physician house call visits and home health care.

 

Parcon owned US Physician Home Visits (USPHV) and managed its operations.  USPHV, located on Viceroy Drive in Dallas, provided physician home visits to Medicare beneficiaries.  It also certified and recertified Medicare beneficiaries for home health services, and it provided medication to Medicare beneficiaries.  It became a credentialed Medicare provider in May 2009.

 

Ezukanma was a medical doctor for USPHV, had an ownership interest in USPHV, and provided his Medicare number to USPHV to use to bill Medicare.  Etindi was also a medical doctor for USPHV, served as its medical director, and also provided his Medicare number to USPHV to use to bill Medicare.  Dejesus held herself out to Medicare as the owner of USPHV and served various roles, including office manager.  Gaines formed a home health agency known as A Good Homehealth, a/k/a “Be Good Healthcare, Inc.,” in 2007, A Good Homehealth, which was located in the same office as USPHV, applied for a Medicare number.  Parcon purchased A Good Homehealth through a straw buyer, and both Parcon and Gaines concealed Parcon’s ownership from Medicare.

 

Parcon and Padilla formed another home health care company known as Essence Home Health, a/k/a “Primary Angel, Inc.,” located on Midway Road in Addison, Texas, and in December 2002, Padilla applied for a Medicare number for Essence.  Parcon, Padilla, Dejesus and Gaines concealed from Medicare that Parcon exercised control over USPHV, A Good Homehealth and Essence Home Health.  While the three companies appeared to be set up as three separate entities, the companies worked as one; the same employees often worked for all three companies and were often paid by all three companies.  Had Medicare known about the improper relationship and true nature of the businesses, that is, the companies shared almost all of their beneficiaries, these companies would not have been allowed to enroll in the program and bill for services.

 

Once USPHV established a new patient and Ezukanma, Etindi or others conducted a home visit, USPHV, at the direction of Ezukanma, Parcon and Dejesus submitted billings for fraudulent claims for services not rendered.

 

USPHV submitted claims as if Ezukanma provided the services to Medicare beneficiaries, regardless of who actually performed the service; this caused Medicare to pay a higher reimbursement rate.  Then, beginning in January 2013, the majority of claims for USPHV were submitted as if Etindi provided the services, regardless of who actually did perform the services.  Ezukanma, Parcon and Dejesus submitted reimbursement claims for physician home visits that falsely represented to Medicare that Ezukanma and Etindi conducted comprehensive patient exams and prolonged service patient exams, when they did not.  At the defendants’ directions, the majority of the claims fraudulently claimed that Ezukanma or Etindi spent a minimum of 90 minutes of face-to-face time with a patient, when in fact, most visits took a total of 15-20 minutes.

 

Ezukanma and Etindi signed Medicare Form 485s certifying the Medicare beneficiaries for home health services even if the beneficiary was ineligible to receive the benefits.  They also signed and certified Form 485s regardless of the homebound status of the patient and often without any knowledge of the patient or the patient’s medical condition.

 

More than 97% of USPHV’s Medicare patients received home health care – whether they needed it or not.  As a result of these false Form 485 certifications, Medicare paid more than $40 million in fraudulent home health services.

 

 The investigation is being conducted by the FBI, the U.S. Department of Health and Human Services – Office of Inspector General and the Texas Attorney General’s Medicaid Fraud Control Unit.  Assistant U.S. Attorney Katherine Pfeifle is in charge of the prosecution.

 

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DALLAS — Arthur Lee Hightower, II, a Dallas man who was on the lam for more than seven months following his indictment in May 2015 for his role in a jewelry theft scheme that targeted the Army and Air Force Exchange Services (AAFES), was sentenced today, following his guilty plea in February 2016, announced U.S. Attorney John Parker of the Northern District of Texas.

Hightower II, 56, was sentenced to 17 months in federal prison by U.S. District Judge Sam A. Lindsay.  He was also ordered to pay $47,740 in restitution. 

In May 2015, Hightower and his former wife, Jessie Faye Hightower, a/k/a “Jessie Faye Lewis,” 55, of Balch Springs, Texas, and their two sons, Arthur Lee Hightower III, 34, of Lancaster, Texas, and Travoine Lee Hightower, 31, of Dallas, were charged in a federal indictment with felony offenses stemming from a scheme which began with Hightower II stealing 70 wedding ring sets valued at nearly $100,000 from AAFES.  Jessie Fay Hightower and Arthur Lee Hightower III each pleaded guilty to one count of conspiracy to receive stolen government property (stolen ring sets) and were sentenced to 18-month and 24-month terms of probation, respectively.  Travoine Lee Hightower pleaded guilty to one count of receiving stolen government property and was sentenced to a one-year term of probation. 

According to plea documents filed in the case, Hightower II worked as a truck driver, and part of his duties included delivering AAFES merchandise to the AAFES offices in Dallas.  On approximately October 3, 2014, Hightower II, who was responsible for safeguarding the merchandise, did not deliver all of the AAFES merchandise instead, he stole approximately 70 wedding ring sets from AAFES.

Hightower II admitted he gave several of the wedding ring sets to his co-defendant family members so they could pawn the stolen jewelry to obtain cash. 

The case was investigated by agents of the Defense Criminal Investigative Service and the Air Force Office of Special Investigations.  Assistant U.S. Attorney David Jarvis prosecuted.

# # #

DALLAS — Mecose Mendale Shorter, 32, was sentenced today by U.S. District Judge David C. Godbey to 60 months in federal prison for engaging in an enterprise that promoted prostitution at various hotels in Dallas, announced U.S. Attorney John Parker of the Northern District of Texas.

Shorter pleaded guilty to one count of using a facility of interstate commerce in aid or a racketeering enterprise.  Shorter’s co-defendants, Kenneth Laray White, 27, and his brother, Damion Kentrell White, 25, were sentenced earlier this year to 326 months and 240 months, respectively, in federal prison.  Each pleaded guilty to one count of using a facility of interstate commerce in aid of a racketeering enterprise and one firearm offense.

According to documents filed in the case, from approximately July 4, 2013, to July 22, 2013, Mecose Shorter, Damion White, and Kenneth White engaged in an enterprise that promoted prostitution in various hotels in Dallas.  In early July 2013, Damion and Kenneth White recruited a mentally challenged 18-year-old girl to work for them in the prostitution enterprise.  While Shorter had contact with the 18-year-old girl on various occasions, during this time period, he was engaged in the unlawful activity of promoting prostitution of another female, Jane Doe.

Shorter admitted he used facilities of interstate or foreign commerce, namely a cell phone and hotel rooms, with the intent to promote, manage, establish, carry on, and/or facilitate Jane Doe’s involvement in commercial sex acts.  Shorter further admitted he received payments from Jane Doe for engaging in commercial sex acts.

Damion and Kenneth White knew their victim since she was 15 years old.  When she was age 18, they devised a plan to recruit her to engage in commercial sex acts for them by taking advantage of her diminished mental capacity.  In late June 2013, Damion White established a friendship with the victim, and then, in early July of 2013, he used false pretenses to convince her to leave her home with him.

That night, Kenneth and Damion White drove the victim to a motel in Dallas where Damion White had rented a room.  Kenneth White used his cell phone to take provocative photos of the victim that they later used in advertisements they posted on backpage.com.  They deprived her of food and prevented her from leaving the room to encourage her to engage in commercial sex acts for them.  Kenneth White had sex with the victim, and the victim eventually engaged in commercial sex acts and provided the money she earned to Kenneth White.  Kenneth and Damion White used the Internet and a cell phone to coordinate the victim’s commercial sex acts with potential customers.

Later, Kenneth and Damion White moved the victim to another motel in Dallas where they continued to compel her to engage in commercial acts during the latter part of July 2013.  Officers with the Dallas Police Department rescued the victim from this motel on July 22, 2013.

The North Texas Trafficking Taskforce, including the FBI, Bureau of Alcohol, Tobacco, Firearms and Explosives and the Dallas Police Department, investigated.  Assistant U.S. Attorney Cara Foos Pierce prosecuted the case.

# # #

DALLAS —Devonte Aaron Dillard, 24, was sentenced yesterday by U.S. District Judge Sam A. Lindsay to serve a total of 240 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.

Dillard pleaded guilty in July 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.  Judge Lindsay sentenced him to 120 months on each of the two counts, to run consecutively.

Three of Dillard’s codefendants in the case, Colby Cole Ditto, 21, Tatiana Renee Sallie, 20, and Trenton Kyle Sirkel, 21, have pleaded guilty to their respective roles in the conspiracy and are awaiting sentencing.  Lead defendant Michael Deshun Holland, Jr., 22, is currently set to go to trial February 6, 2017, before Judge Lindsay.

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

On April 17, 2015, while Sallie waited in the car, Dillard and Holland entered the Chevron Food Mart on Highway 80 in Mesquite and brandished a firearm.  Dillard shot the store employee while he and Holland robbed the store.

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 are in charge of the prosecution.

# # #

DALLAS — Gregory Steven Hunt, a/k/a “K.C.,” of Dallas, was sentenced on Friday to 204 months in federal prison, following his guilty plea in April 2015 to one count of kidnapping, announced U.S. Attorney John Parker of the Northern District of Texas.

Hunt, 44, and his co-defendant, Steric Paul Mitchell, 46, planned to kidnap a female victim and sell her into sex slavery.  Mitchell was convicted, after a nearly two-week trial in August 2015, on one count of conspiracy to commit kidnapping and one count of kidnapping.  His sentencing date is pending.

According to evidence presented at Mitchell’s trial and documents filed in the case, Mitchell and Hunt knew each other from the neighborhood, and in early May 2012, Mitchell hired Hunt to pick up the victim at a hotel and transport her to another location under the ruse that Hunt was taking her to a private party.  In fact, Hunt and Mitchell planned to kidnap and sexually assault her.  Hunt was also supposed to pay another woman, R.E., $100 when he picked up the victim from the motel, and Hunt understood he would get to have sex with the victim as part of the agreement.

R.E. told the victim that she had a “good friend” who wanted to hire a private dancer for a party, and that the men were “safe.”  At a Dallas hotel, R.E. introduced the victim to Hunt, who paid R.E. the $100 and then drove the victim to an abandoned house in Dallas where Mitchell was waiting. 

At the abandoned house, Mitchell threatened the victim with a firearm and shocked her with a Taser to frighten and restrain her.  Hunt then raped her while Mitchell stood guard with a firearm.  Mitchell then shocked her again with a Taser, bound her ankles and wrists, wrapped her in a bed sheet, carried her to another motor vehicle, and put her in the backseat.  He then drove the victim to a second location, tied her to a chair, raped her, and told her he planned to sell her into sexual slavery.  He held her overnight at that location.  Later, he wrapped her in a bed sheet again, put her in the backseat of a vehicle, and drove her to a house in Duncanville, Texas, where he sexually assaulted her.  At this third location, the victim was able to locate a cell phone and place four 911 calls; officers with the Duncanville Police Department found and rescued her.

The FBI and the Duncanville Police Department investigated.  Assistant U.S. Attorneys Cara Foos Pierce and Andrew Wirmani prosecuted.

# # #

A San Angelo, Texas, man pleaded guilty today to fraud and obstruction of justice charges in connection with two investment companies he ran that defrauded investors out of approximately $900,000 over a four-year period.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney John R. Parker of the Northern District of Texas and Special Agent in Charge Thomas M. Class Sr. of the FBI’s Dallas Office made the announcement.

Stanley Jonathan Fortenberry, 50, pleaded guilty to two counts of mail fraud and one count of obstructing an official proceeding before U.S. Magistrate Judge D. Gordon Bryant Jr. of the Northern District of Texas.  Sentencing will be scheduled at a later date. 

As part of his guilty plea, Fortenberry 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 Securities and Exchange Commission (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.

As part of the department’s investigation into Wattenberg, Peter Szondy, 70, and Stanley Stephen Fortenberry, 24, both pleaded guilty and admitted to committing fraud while working for Wattenberg.

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.

The Fraud Section plays a pivotal role in the department’s fight against white collar crime around the country.  Today’s guilty plea is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF), which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes.  With more than 20 federal agencies, 94 U.S. Attorneys’ offices and state and local partners, it is the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud.  Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations.  Over the past three fiscal years, the department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants, including more than 2,700 mortgage fraud defendants.  For more information on the task force, visit www.stopfraud.gov.

DALLAS — A Dallas-area man who admitted to his role in transporting a substance that was represented to be cocaine on flights from Dallas-Fort Worth International Airport (DFW) was sentenced today to a lengthy federal prison sentence, announced U.S. Attorney John Parker of the Northern District of Texas.

 

Funaki Falahola, 35, was sentenced by U.S. District Judge Jane J. Boyle to 240 months in federal prison following his guilty plea in May 2016 to one count of conspiracy to possess with intent to distribute and distribute at least five kilograms or more of cocaine.  Falahola has been in custody since mid-July 2015 following a law enforcement operation, led by the Federal Bureau of Investigation, the Dallas Police Department and Internal Revenue Service Criminal Investigation, in which numerous defendants were arrested on drug distribution conspiracy and related charges outlined in a federal superseding indictment returned by a federal grand jury in Dallas the previous month.

 

That superseding indictment charged Funaki Falahola and three others, Moniteveti Katoa, 53, Molitoni Katoa, 34, and Janelle Isaacs, 42, with the cocaine distribution conspiracy offense.  All four defendants pleaded guilty to the offense.  In September 2016, Moniteveti Katoa was sentenced to 188 months and Molitoni Katoa was sentenced to 90 months in federal prison.  Janelle Isaacs is scheduled to be sentenced on December 1, 2016.  The statutory penalty for the offense is not less than 10 years and up to life in federal prison and a $10 million fine.

 

Funaki Falahola told undercover officers he had family members that could transport controlled substances via commercial airline. Funaki Falahola introduced Moniteveti Katoa to agents as his Uncle and family leader. Molitoni Katoa was also introduced as Falahola’s cousin and a person that could smuggle controlled substances into the DFW airport through his job at the cargo area at the DFW airport. Moniteveti Katoa’s wife, Janelle Isaacs, worked for American Airlines.

 

According to documents filed in the case, the four used their positions of employment at DFW, or contacted a person or persons who had a position or positions of employment at DFW, to bypass security in order to transport kilogram quantities of a substance that was represented to be cocaine, in what they did not know was an undercover law enforcement operation.  As part of the conspiracy, that ran from approximately April 18, 2013, through July 14, 2015, the substance that was represented to be cocaine was transported on commercial airlines flying from DFW to destinations in Las Vegas, Nevada; Newark, New Jersey; Phoenix, Arizona; Chicago, Illinois; Wichita Kansas; and San Francisco, California.

 

Falahola introduced Moniteveti Katoa to the undercover officer who was interested in smuggling cocaine from DFW Airport.  He noted that Moniteveti Katoa had worked for American Airlines for 25 years and was a leader in the Tongan community.  Falahola advised the undercover officers that they could transport the cocaine to major U.S. cities as well as to Hawaii and New Zealand.  Moniteveti Katoa advised the undercover officer that he was willing to fly to locations in advance of smuggling the cocaine to conduct security checks.  In fact, from September 2013 through May 2015, Moniteveti Katoa smuggled what he thought was cocaine on at least six flights from DFW Airport to Las Vegas, Newark, Chicago, Wichita, San Francisco, and Tempe, Arizona.  Falahola was with Moniteveti Katoa on the Las Vegas trip.

 

In June 2013, Falahola and other defendants provided security in a drug protection arrangement for the sale of 20 kilograms of cocaine in Dallas.  Falahola was paid $2800 for his protection services, and he paid the others out of this money. 

 

The FBI, Dallas Police Department and Internal Revenue Service Criminal Investigation led the investigation with assistance from the Texas Department of Public Safety; the DFW Department of Public Safety; the U.S. Department of State; the Drug Enforcement Administration; the Bureau of Alcohol, Tobacco, Firearms and Explosives; the Transportation Security Administration; the U.S. Secret Service; U.S. Immigration and Customs Enforcement’s Enforcement and Removal Operations; and the Fort Worth, McKinney, Mesquite, and Plano Police Departments.

 

Assistant U.S. Attorney George Leal is in charge of the prosecution.

# # #

FORT WORTH, Texas – A Whittier, California, man was convicted today of wire fraud in connection with his involvement in a scheme to defraud a software company of more than $16 million, announced U.S. Attorney John Parker of the Northern District of Texas and Assistant Attorney General for the Criminal Division Leslie R. Caldwell.

Anthony Clark, 24, was convicted, following a three-day jury trial before U.S. District Judge Reed C. O’Connor, on an indictment charging one count of conspiracy to commit wire fraud.  He faces a maximum statutory penalty of 20 years in federal prison, a $250,000 fine and restitution.   Sentencing has been scheduled for February 27, 2017.

Evidence presented at trial showed that Clark and three co-conspirators defrauded software company Electronic Arts (EA).  EA is the publisher of a video game called FIFA Football, in which players can earn “FIFA coins,” a virtual in-game currency generally earned based on the time users spend playing FIFA Football.  Due to the popularity of FIFA Football, a secondary market has developed whereby FIFA coins can be exchanged for U.S. currency.  Clark and his co-conspirators circumvented multiple security mechanisms created by EA in order to fraudulently obtain FIFA coins worth over $16 million.  Specifically, Clark and his co-conspirators created software that fraudulently logged thousands of FIFA Football matches within a matter of seconds, and as a result, EA computers credited Clark and his co-conspirators with improperly earned FIFA coins.  Clark and his co-conspirators subsequently exchanged their FIFA coins on the secondary market for over $16 million. 

Co-conspirators Nick Castellucci, 24, of, New Jersey; Ricky Miller, 24, of Arlington, Texas; and Eaton Zveare, 24, of Lancaster, Virginia, previously pleaded guilty and await sentencing. 

The FBI and Internal Revenue Service Criminal Investigation investigated the case.  Assistant U.S. Attorneys Brian Poe and C. Heath of the Northern District of Texas and Senior Counsel Ryan Dickey of the Criminal Division’s Computer Crime and Intellectual Property Section are in charge of the prosecution. 

# # #

A Whittier, California man was convicted today of wire fraud in connection with his involvement in a scheme to defraud a software company of over $16 million, announced Assistant Attorney General for the Criminal Division Leslie R. Caldwell and U.S. Attorney John R. Parker of the Northern District of Texas.

Anthony Clark, 24, was convicted by a jury sitting in Fort Worth, Texas, of one count of conspiracy to commit wire fraud.  Sentencing has been scheduled for February 27, 2017.

Evidence presented at trial showed that Clark and three co-conspirators defrauded software company Electronic Arts (EA).  EA is the publisher of a video game called FIFA Football, in which players can earn “FIFA coins,” a virtual in-game currency generally earned based on the time users spend playing FIFA Football.  Due to the popularity of FIFA Football, a secondary market has developed whereby FIFA coins can be exchanged for U.S. currency.  Clark and his co-conspirators circumvented multiple security mechanisms created by EA in order to fraudulently obtain FIFA coins worth over $16 million.  Specifically, Clark and his co-conspirators created software that fraudulently logged thousands of FIFA Football matches within a matter of seconds, and as a result, EA computers credited Clark and his co-conspirators with improperly earned FIFA coins.  Clark and his co-conspirators subsequently exchanged their FIFA coins on the secondary market for over $16 million.  

Co-conspirators Nick Castellucci, 24, of New Jersey; Ricky Miller, 24, of Arlington, Texas; and Eaton Zveare, 24, of Lancaster, Virginia, previously pleaded guilty and await sentencing.  

The FBI and the Internal Revenue Service investigated the case.  Senior Counsel Ryan Dickey of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorneys Brian Poe and Candina Heath of the Northern District of Texas are prosecuting the case.  

LUBBOCK, Texas —  Late yesterday, following a one-day trial before Senior U.S. District Judge Sam R. Cummings, a federal jury convicted Richard Jasso, 39, of San Angelo, Texas, 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.”  If the Court finds those convictions are final and valid, then, by statute, the Court must impose a life sentence, without parole.  A sentencing date was not set.

Jasso has been in custody since his arrest on July 13, 2016, when numerous defendants, most from the San Angelo area, 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.  Twelve defendants, including the drug trafficking organization’s leader, Rudolfo Ledesma Castaneda, Jr., 31, were charged in an indictment with 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 conviction, all 12 defendants charged in the indictment have been convicted and await sentencing.  One defendant, Jesse Huerra, 31, was convicted at trial in San Angelo in September 2016 on methamphetamine distribution and firearm charges.  He faces a mandatory life sentence.

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 is in charge of the prosecution.

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AMARILLO, Texas — Guadalupe Reyes, a/k/a “Lupe,” 49, of Etter, Texas, was sentenced this morning by U.S. District Judge Sidney A. Fitzwater to 188 months in federal prison, following his guilty plea in June 2016 to one count of conspiracy to distribute and possess with intent to distribute 1,000 kilograms or more of marijuana.  U.S. Attorney John Parker of the Northern District of Texas made today’s announcement.

In addition, Reyes must forfeit to the government several parcels located in Moore County, Texas.

Co-defendant Marco Saucedo, 45, of Cactus, Texas, was sentenced in September 2016 to 48 months in federal prison following his guilty plea to one count of unlawful use of a communications facility.

According to documents filed in the case, in November 2014, officers with the Cactus Police Department responded to a weapon being discharged at a residence in Cactus that was owned by Guadalupe Reyes, and they determined that the individual who discharged the firearm was renting the property from Reyes.  After obtaining consent to search, officers found more than $130,000 in cash inside the residence, which the resident advised was cash that he, at the direction of Reyes and Saucedo, brought back the previous week from Wichita and Topeka, Kansas.

The resident further disclosed he had been working for Reyes for several months, transporting large amounts of marijuana from Amarillo and Fritch, Texas, to other states, such as Kansas and Ohio.  He would also transport large amounts of cash – proceeds from the sale of the marijuana – from those locations to the Cactus area, all at the direction of Reyes and Saucedo, who would pay him a set amount for each of the runs he made.

The resident indicated he had made approximately 10 trips to Wichita, Topeka, and Kansas City, Kansas, as well as to Toledo, Ohio, to deliver marijuana for Reyes, estimating that he had delivered approximately 8,000 pounds of marijuana while employed by Reyes.  He further stated that on at least four occasions, he had returned with approximately $400,000 in cash for marijuana he had delivered.  He further stated that Reyes instructed him to keep the money at the residence until it was retrieved by other, unnamed individuals.  The individual also stated that both Reyes and Saucedo had directed him to only use pre-paid cell phones when communicating with them or the buyers. 

In recorded conversations in November 2014, Reyes stated, among other things, that he was worried about law enforcement taking some of his properties. 

This OCDETF case was investigated by the Federal Bureau of Investigation, the Texas Department of Public Safety, the Moore County Sheriff’s Office and the Cactus Police Department.  Assistant U.S. Attorney Sean Long was in charge of the prosecution.           

# # #

DALLAS — A Lancaster, Texas, Man, Javier Martinez, 24, appeared this morning before U.S. Magistrate Judge David L. Horan and pleaded guilty to several felony offenses related to his involvement in an attempted kidnapping and then subsequently firing numerous shots at an officer with the Ennis Police Department during a high-speed pursuit, announced U.S. Attorney John Parker of the Northern District of Texas.

Specifically, Martinez pleaded guilty to one count each of conspiracy to commit kidnapping; possession with intent to distribute cocaine; possession with intent to distribute heroin; using, carrying, and brandishing a firearm during or in relation to a crime of violence; and possession of a firearm in furtherance of a drug trafficking crime.  While Martinez faces a statutory maximum sentence of life in federal prison and a $2.75 million fine, if the Court accepts the plea agreement between the government and the defendant, Martinez should receive a total sentence of 40 years in federal prison.  Sentencing is set for March 2, 2017, before U.S. District Judge Jane J. Boyle.

According to documents filed in the case, on July 12, 2016, Martinez, along with co-defendants Jose Cardenas Aguirre, 25, and Melissa Trevino, 23, planned to kidnap another individual because of an unpaid drug debt involving cocaine.  During the planned kidnapping, Martinez and Aguirre wore ballistic vests and black camouflage clothing.  The kidnapping was unsuccessful, and as 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, Martinez, using an AR-156 style rifle, fired numerous shots at a police officer.  Martinez led, supervised, and organized this planned kidnapping.

A trial date of December 5, 2016, has been set for defendants Aguirre and Trevino.  Three other defendants charged in the case have pleaded guilty and are awaiting sentencing.

Between December 2015, and continuing to July 2016, Martinez conspired to possess with intent to distribute cocaine and heroin.  On February 5, 2016, Martinez possessed a firearm in furtherance of these drug trafficking crimes.

In addition, according to the factual resume, on January 7, 2016, Martinez sold another individual one ounce of heroin and offered to sell that same individual one kilogram of heroin for $40,000.  During that same conversation, Martinez offered to sell the same individual an AK-47 for $7,000 and an AR-15 rifle for $1,500.  On April 11, 2016, Martinez sold three ounces of heroin and two AR-15’s to another individual; these drug and gun sales took place at his residence.

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

# # #

AMARILLO, Texas — Two men who were convicted after an eight-day trial in June 2016 on the felony offense of interference with a flight crew and aiding and abetting were sentenced today, announced U.S. Attorney John Parker of the Northern District of Texas.

Jonathan Khalid Petras, 21, was sentenced by U.S. District Judge Sidney A. Fitzwater to seven months in federal prison, and Wisam Imad Shaker, 23, was sentenced to five months in federal prison.  Judge Fitzwater also ordered them to pay $6,890 in restitution, jointly and severally.  They must surrender to the Bureau of Prisons on January 3, 2017. 

At trial, the government presented evidence that on August 31, 2015, the defendants, both residents of the San Diego area, were aboard Southwest Airlines flight 1522, from San Diego to Chicago.  During that flight, the defendants, who were sitting together in two adjacent rows, repeatedly failed to comply with safety instructions, were loud and disruptive, screamed profanities at flight attendants when they were denied alcohol, and some of the men lunged and made other aggressive movements toward the flight attendants.

The flight was diverted to Rick Husband International Airport in Amarillo so law enforcement could remove the defendants from the flight.

The FBI, the Amarillo Police Department and the Rick Husband International Airport Police investigated the case.  Assistant U.S. Attorneys Mark Penley, Joshua Frausto and Amy Burch prosecuted the case.

           

# # #

DALLAS — Following a nearly one-week trial before U.S. District Judge Sam A. Lindsay, two former employees of the U.S. Postal Service were convicted on felony offenses stemming from their 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.

McArthur Baker, 69, and Tonya Evans, 52, both of Dallas, were each convicted 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.   The conspiracy count carries a maximum statutory penalty of 10 years in federal prison and a $250,000 fine.  The false statements or fraud count carries a maximum statutory penalty of five years in federal prison and a $250,000 fine.  Both will remain on bond pending sentencing, which is set for March 6, 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 $3,000 from Washington; Evans received $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. Attorney P.J. Meitl and Special Assistant U.S. Attorneys Nicole Dana and Jennifer Bray are in charge of the prosecution.

# # #

DALLAS — A Dallas woman, Manuela Esperanza Pavon, 35, was sentenced this morning by U.S. District Judge David C. Godbey to 150 months in federal prison, following her guilty plea in April 2016 to one count of conspiracy to distribute methamphetamine, announced U.S. Attorney John Parker of the Northern District of Texas.

According to documents filed in the case, on November 10, 2015, Pavon, who admits that her license was suspended, was stopped by the Dallas County Sheriff’s Office for a traffic violation. The deputy advised her that he was going to tow her vehicle since she did not have a valid driver license.

During an inventory of her vehicle, the deputy located a purse on the front passenger floorboard area, and he asked if it belonged to Pavon.  She said that it did.  Inside the purse, the deputy located a plastic bag containing a crystal-like substance that later tested positive for one kilogram of methamphetamine.  Pavon admitted she possessed the methamphetamine with the intent to distribute it.

The Drug Enforcement Administration and the Dallas County Sheriff’s Office investigated the case.  Assistant U.S. Attorney Phelesa Guy was in charge of the prosecution.

# # #

DALLAS — Two Dallas men who were convicted on methamphetamine trafficking conspiracy charges were sentenced last week by Chief U.S. District Judge Barbara M. G. Lynn to lengthy federal prison terms, announced U.S. Attorney John Parker of the Northern District of Texas.

Jose Mario Chavez-Bravo, a/k/a “Rafael Lua-Maguna” and “Mickey,” 27, was sentenced to 200 months in federal prison.  Rafael Hurtado, a/k/a “Rafi,” and “Ralphie,” was sentenced to 135 months in federal prison.  Each pleaded guilty in May 2016 to one count of conspiracy to distribute a controlled substance.

Chavez-Bravo admitted that during the conspiracy, he possessed with the intent to distribute and/or distributed at least eight kilograms of methamphetamine.  On February 9, 2015, Chavez-Bravo spoke to a male over his cell phone about turning over some drug proceeds (“about $300”) to the male.  The next day, Chavez met with the male at the Texas Motel on West Davis Street in Dallas and delivered to him a box containing approximately $300,000 in cash drug proceeds.  In fact, Chavez-Bravo admitted that during the conspiracy, he collected or delivered a total of $569,305 in drug proceeds.

Hurtado admitted that on several occasions during the conspiracy, he received quantities of methamphetamine from methamphetamine distributor, Tommy Rodriguez, and then distributed the drugs in exchange for payment.  In fact, during the conspiracy, Hurtado possessed with the intent to distribute and/or distributed 11 kilograms of methamphetamine.

The Drug Enforcement Administration investigated.  Assistant U.S. Attorney Phelesa Guy prosecuted the case.

# # #

FORT WORTH, Texas – John Parker, U.S. Attorney for the Northern District of Texas, and William Temple, Special Agent in Charge, Bureau of Alcohol, Tobacco, Firearms and Explosives Dallas Field Division, joined Ken Shetter, President of One Safe Place, and Joel Fitzgerald, Fort Worth Chief of Police, at a press conference this morning to announce a $500,000 federal grant that has been awarded to One Safe Place to implement the Project Safe Neighborhoods (PSN) initiative in two Fort Worth neighborhoods. 

PSN is a nationwide commitment to reduce gang and gun crime in the U.S. by networking existing local programs that target gun and gang crime and providing these programs with additional tools for success.  PSN’s strategic approach brings more “science” into criminal justice operations by leveraging innovative applications of analysis, technology and evidence-based practices to improve performance and effectiveness while containing costs.

The grant is one of only seven half-million dollar grants awarded by the Justice Department’s Office of Justice Programs Bureau of Justice Assistance and funded under the 2016 Violent Gang and Gun Crime Reduction/Project Safe Neighborhoods initiative.  This grant also addresses domestic violence, which, according to many statistics, is a major contributing factor for the increase in gun and violent crimes.

The funds from this grant will be specifically used in the Stop Six/Poly and the Las Vegas Trail Corridor in Fort Worth.  Following this morning’s press conference, volunteers and neighborhood police officers with the Fort Worth Police Department will distribute door hangers in those neighborhoods.  Each “Not on My Block” door hanger provides resources for reporting criminal activity, to include the Crime Stoppers anonymous tip line phone number.

“My office is committed to working side by side with the people who live in these neighborhoods, our partners at One Safe Place, and our partners in law enforcement to stop the destructive cycle of gun and gang violence that terrorizes our communities,” said U.S. Attorney Parker.  “This grant funding significantly enhances that effort in Fort Worth by providing additional tools for success.”     

“With the additional grant funding for One Safe Place, another great step in the holistic approach in tackling the gun and gang problem that plagues many cities is taking place here in Fort Worth,” SAC Temple said.  “It is through community based organizations working with law enforcement at every level that this problem can be addressed and make life better for our citizens.”

“As longstanding partners with One Safe Place in the effort to reduce violent crime in Tarrant County, we are extremely pleased the DOJ chose to fund their efforts to reduce gang and gun violence,” said Chief Fitzgerald. “We are steadfast in our commitment to meaningful partnerships in the community to make Fort Worth the safest large city in America. This grant award will certainly bring us closer to that reality.”

“PSN has helped ensure a very effective collaboration between local, federal and community based partners, which has reduced gun and gang violence in Fort Worth,” said Mr. Shetter.  “Funding under the 2016 PSN Program will allow us to take this partnership to the next level, build on the knowledge and best practices that have already been developed, and target resources on hot spots for gun and gang violence.  We are particularly excited that the One Safe Place strategy addresses domestic violence as a significant contributor to gun and gang violence in the community.”       

One Safe Place, in collaboration with partner agencies, will use the new grant to focus on targeted enforcement, prevention, community outreach, and reentry programs, with an emphasis on interrupting the cycle of violence in order for communities to sustain crime reduction.  

# # #

    

 

FORT WORTH, Texas — Four individuals, with ties to the Polywood Crips street gang in Fort Worth, Texas, have pleaded guilty to their respective roles in a child sex trafficking conspiracy, announced U.S. Attorney John Parker of the Northern District of Texas.

Today, Audry Lane, a/k/a “Spud,” 29, pleaded guilty before U.S. District Judge Reed C. O’Connor to one count of conspiracy to commit sex trafficking of children.  Yesterday, Deon Bonner, a/k/a “Spanish Fly,” 26, pleaded guilty to the same offense and Chad Johnson, a/k/a “Ocho Hood Fame,” 24, pleaded guilty to one count of sex trafficking of children.  In late October, Stanley Johnson, a/k/a “Pee Wee,” 24, pleaded guilty to one count of conspiracy to commit sex trafficking of children.  Upon conviction, each count carries a maximum statutory penalty of life in federal prison and a $250,000 fine.

Two defendants, Diwone Nobles, a/k/a “Pooh,” 32, and Katelyn Micelle Ward, a/k/a “KD,” 24, are set for trial. 

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, a/k/a “Spank,” acted as pimps for the girls and women they trafficked.  The 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 member 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. 

Alvin Lane pleaded guilty last month to one count of conspiracy to commit sex trafficking of children.  Serrah and Jessica Arnold each pleaded guilty last month to one count of use of a facility of interstate commerce in aid of a racketeering enterprise.

For instance, on approximately June 1, 2013, 17-year-old Jane Doe 4 was introduced to Audry Lane, Serrah and Jessica Arnold, and Alvin Lane by a family friend of the Arnolds, defendant Katelyn Ward.  Ward asked the Lanes and Arnolds to teach Jane Doe 4 how to engage in commercial sex acts.  Serrah and Jessica Arnold explained to Jane Doe 4 about Backpage.com and how to talk to commercial sex customers.  Ward, along with Audry Lane, and later Alvin Lane, acted as Jane Doe 4’s pimp at various times between 2013 and 2015.  Audry Lane knew she was age 17 when he began facilitating her commercial sex acts, and he kept the proceeds she earned.  Various member of the group posted Jane Doe 4 on Backpage.com and facilitated her commercial sex acts.

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.

According to the complaint filed in the case, an adult female victim engaged in commercial sex acts at the direction of Nobles, Chad Johnson, Audry Lane, Alvin Lane, and Serrah Arnold.  Nobles frequently assaulted her when she made him angry or did not follow his instructions; he also raped her.  Nobles kept the money she earned and the contact phone number used in the Backpage.com ad for her services was used by Nobles.   In one trip to Austin, this adult female victim made enough money for Nobles to buy a Chevy sedan that he painted bright orange – “Poly Orange” in reference to their neighborhood Polytechnic Heights – that he still owns.

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. 

When an adult female victim engaged in commercial sex acts at Audry Lane’s direction, he would have Serrah Arnold, his “bottom girl,” supervise the victim and take the money she received. 

A minor female victim engaged in commercial sex acts at the direction of Audry Lane, Alvin Lane, Serrah Arnold and Jessica Arnold.  Alvin Lane would have his girlfriend/bottom girl, Jessica Arnold post photos of her in ads that she placed on Backpage.com.  The minor female victim would give all the money she earned to Jessica or Serrah Arnold, who would then give the money to Audry Lane or Alvin Lane.

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 are investigating.  Assistant U.S. Attorney Cara Foos Pierce is in charge of the prosecution.               

# # #

Contact Information:

Ken Shetter, OSP – 817-502-7110 or 817-707-7824 (cell)

Lt. Kirk Driver, PSN Chair, FWPD – 817-996-0356 (cell)

Kathy Colvin, OUSA – 214-659-8600

SSA Scott Ragsdale, ATF – 469-227-4322

Announcing an award of $500,000, one of seven nationally, to One Safe Place for the implementation of the Project Safe Neighborhoods Initiative in two designated areas in Fort Worth, Texas.

A press conference is scheduled for Thursday, November 10th, at 10:00AM in the auditorium of One Safe Place located at 1100 Hemphill Street in Fort Worth. Details of how the multidisciplinary PSN Task Force works together, the outreach programs, and the results of the past PSN initiative will be available at the press conference.  Members of the PSN Task Force representing 17 agencies participate in the operation of the PSN Project.

Participants in the Press Conference:

The Honorable John Parker, U.S. Attorney for the Northern District of Texas,

Bill Temple, Special Agent in Charge, Bureau of Alcohol, Tobacco, Firearms

and Explosives, Chief Joel Fitzgerald, Fort Worth Chief of Police, Ken Shetter,

President, One Safe Place and other invited guests.

PrProject Safe Neighborhoods (PSN), a program of the Department of Justice, is a nationwide commitment to reduce gun and gang crime in America by networking existing local programs and using data-driven targeted enforcement to address many of the causes of these crimes, such as family violence and repeat/returning offenders. The goal is to create safer neighborhoods by involving the communities in these efforts and identifying needed resources that include prevention and outreach, as well as, enforcement to sustain this reduction in crime.

Interview opportunities will be available

####

LUBBOCK, Texas — Two women from Lubbock, Texas, Crystal Ann Alaniz and Arleen Theres Keithley, appeared yesterday afternoon before U.S. Magistrate Judge D. Gordon Bryant Jr., and pleaded guilty to their roles in a methamphetamine distribution conspiracy, announced U.S. Attorney John Parker of the Northern District of Texas.

Alaniz, 32, pleaded guilty to one count of possession with intent to distribute 50 grams or more of methamphetamine and aiding and abetting; she faces a statutory sentence of not less than five years or more than 40 years in federal prison and a $5 million fine.  Keithley, 36, pleaded guilty to one count of possession with intent to distribute methamphetamine and aiding and abetting; she faces a maximum statutory penalty of 20 years in federal prison and a $1 million fine.  Judge Bryant ordered a presentence investigation report for each defendant with sentencing dates to be set after the completion of those reports.

Co-defendant Jonathan Lovato, 33, of Lubbock, also pleaded guilty yesterday.  Last week, co-defendants Juan Carlos Lara-Ochoa, 24, and Jose Alberto Cibrian, 41, pleaded guilty to their roles in the conspiracy.

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.  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 case is being investigated by the Lubbock Police Department, the Littlefield Police Department, the Texas Department of Public Safety and the Bureau of Alcohol, Tobacco, Firearms and Explosives.  Assistant U.S. Attorney Sean Long is in charge of the prosecution.        

# # #

LUBBOCK, Texas — A Lubbock, Texas, man, Jonathan Lovato, 33, appeared yesterday afternoon before U.S. Magistrate Judge D. Gordon Bryant Jr. and pleaded guilty to federal offenses stemming from his role in a methamphetamine distribution conspiracy, announced U.S. Attorney John Parker of the Northern District of Texas.

Lovato pleaded guilty to one count of possession with intent to distribute 50 grams or more of methamphetamine and aiding and abetting, and one count of possession of a firearm in furtherance of a drug trafficking crime and aiding and abetting.  He faces a statutory penalty of not less than five years or more than 40 years in federal prison and a $5 million fine on the drug conviction and not less than five years and up to life and a $250,000 fine on the firearm conviction.  Judge Bryant ordered a presentence investigation report with a sentencing date to be set after the completion of that report.

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 later died. 

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.

The case is being investigated by the Lubbock Police Department, the Texas Department of Public Safety, and the Bureau of Alcohol, Tobacco, Firearms and Explosives.  Assistant U.S. Attorney Sean Long is in charge of the prosecution.         

# # #

DALLAS — Damion Kentrell White, 24, of Dallas, was sentenced yesterday by U.S. District Judge David C. Godbey to 240 months in federal prison on felony convictions stemming from a plan to recruit a developmentally disabled teenage girl to engage in commercial sex acts, announced U.S. Attorney John Parker of the Northern District of Texas.

Damion White pleaded guilty to one count of using a facility of interstate commerce in aid or a racketeering enterprise and one count of illegal receipt of a firearm by a person under indictment.

His co-defendant brother, Kenneth Laray White, 27, was sentenced earlier this year to serve a total of 326 months in federal prison.  Kenneth White pleaded guilty to one count of using a facility of interstate commerce in aid of a racketeering enterprise and one count of being a felon in possession of a firearm.

Another defendant charged and convicted in the case, their cousin, Mecose Mendale Shorter, 32, also of Dallas, pleaded guilty in May to one count of use of a facility of interstate commerce in aid of a racketeering enterprise and is scheduled to be sentenced on November 28, 2016.

According to documents filed in the case, from approximately July 4, 2013, to July 22, 2013, Damion White, Kenneth White and Mecose Shorter engaged in an enterprise that promoted prostitution in various hotels in Dallas.  In early July 2013, Damion and Kenneth White recruited a mentally challenged 18-year-old girl to work for them in the prostitution enterprise; Shorter was engaged in the unlawful activity of promoting prostitution of another female. 

Damion and Kenneth knew the victim since she was 15 years old.  When she was 18 years old, they devised a plan to recruit her to engage in commercial sex acts for them by taking advantage of her diminished mental capacity.  In late June 2013, Damion White established a friendship with the victim, and then, in early July of 2013, he used false pretenses to convince her to leave her home with him.

Later that night, Kenneth and Damion White drove the victim to a motel in Dallas where Damion White had rented a room.  Kenneth White used his cell phone to take provocative photos of the victim that they later used in advertisements they posted on backpage.com.  They deprived her of food and prevented her from leaving the room to encourage her to engage in commercial sex acts for them.  Kenneth White had sex with the victim, and the victim eventually engaged in commercial sex acts and provided the money she earned to Kenneth White.  Kenneth and Damion White used the Internet and a cell phone to coordinate the victim’s commercial sex acts with potential customers.

Later, Kenneth and Damion White moved the victim to another motel in Dallas where they continued to compel her to engage in commercial acts during the latter part of July 2013.  Officers with the Dallas Police Department rescued the victim from this motel on July 22, 2013.

Kenneth and Damion White were arrested on federal sex trafficking charges on February 25, 2014.  Kenneth White was found at his girlfriend’s apartment, and during a protective sweep of the apartment, agents located a Romar/Cugir 7.62 caliber rifle, along with three extended magazines under the mattress in the master bedroom.  Damion White admitted that he had possessed firearms recently, including the firearm that Kenneth White was caught with that day.  Damion White further admitted that he had been under indictment for a felony marijuana case for quite some time. 

The North Texas Trafficking Taskforce, including the FBI, Bureau of Alcohol, Tobacco, Firearms and Explosives and the Dallas Police Department, investigated.  Assistant U.S. Attorney Cara Foos Pierce is prosecuting the case.

# # #

DALLAS — A Eustace, Texas, man who worked as an inspector for the U.S. Department of Labor’s (DOL) Mine Safety and Health Administration (MSHA) appeared in federal court this morning and pleaded guilty before U.S. Magistrate Judge David L. Horan to a federal offense related to his purposefully falsifying mine safety inspection reports with the intent to deceive the MSHA, announced U.S. Attorney John Parker of the Northern District of Texas.

Nathan Edward Welch, 35, pleaded guilty to an Information charging one count of making a false statement in an official writing.  He faces a maximum statutory penalty of one year in federal prison and a $100,000 fine.  According to the plea agreement, Welch agrees to resign/retire from MSHA within five calendar days of the date he enters his plea, and he agrees to not seek any future employment with the U.S. government.  Sentencing is set for March 8, 2017, before Judge Horan.

According to documents filed in his case, from approximately June to July 2016, Welch stated in a MSHA report that he had completed an onsite inspection from July 6, 2016, to July 11, 2016, for the Dead River Ranch Materials Riesel Sand and Gravel Plant when he knew he had not conducted any such inspection and had never traveled to or met any representative of the Dead River Ranch Materials Mining Operation for an inspection.

In addition, Welch falsified at least three other inspection reports that claimed he performed inspections on the following dates at the following locations:

July 12, 2016              Big Sandy Sand Company North Pit and Mining Operation
                                    Hawkins, Texas

June 1, 2016                Cedar Creek Stone Mine
                                    Groesbeck, Texas

June 23, 2016-            Trinity Lightweight Expanded Shale and Clay Plant
June 30, 2016              Streetman, Texas

In completing these falsified inspection reports, Welch used previously completed reports to create the falsified reports and hand-copied the field notes for these four locations from inspection reports that had been completed earlier in the year.

The case is being investigated by the DOL Office of Inspector General (OIG).  Assistant U.S. Attorney P.J. Meitl is in charge of the prosecution.

# # #

DALLAS — A Dallas man, Marcus Fulbright, 25, of Dallas, was sentenced this afternoon by U.S. District Judge Jane J. Boyle to serve a total of 384 months in federal prison, following his guilty plea to felony offenses stemming from his armed robbery of two 7-Eleven stores in the Dallas area in 2013, announced U.S. Attorney John Parker of the Northern District of Texas.

Fulbright pleaded guilty in April 2016 to two counts of using, carrying, or brandishing a firearm during and in relation to a crime of violence.

According to documents filed in the case, on October 9, 2013, Fulbright entered the 7-Eleven located at 757 E. Beltline Road in DeSoto, Texas, at approximately 4:15 a.m. with the express intent to rob it.  Fulbright brandished a semi-automatic handgun, pointed it at the store clerk, and demanded money.  Fulbright took money from the cash register and fled.

That same morning, just a few minutes later, at approximately 4:30 a.m., Fulbright entered the 7-Eleven located at 640 Pleasant Run in Lancaster, Texas, with the specific intent to rob it.  Fulbright brandished a semi-automatic handgun, pointed it at the store clerk and demanded money from the cash register.  As the clerk struggled to open the cash register, another individual in the store rushed at Fulbright, and Fulbright then pointed his handgun at this individual and discharged a single shot at him.

The case was investigated by the Federal Bureau of Investigation and the Dallas, DeSoto and Lancaster Police Departments.

Assistant U.S. Attorney Andrew Wirmani was in charge of the prosecution.

# # #

DALLAS — Santiago Veliz, 29, of Dallas, was sentenced today by U.S. District Judge Jane J. Boyle to 140 months in federal prison following his guilty plea in May 2016 to a felony Information charging one count of conspiracy to possess with intent to distribute methamphetamine, announced U.S. Attorney John Parker of the Northern District of Texas.

Veliz’s co-conspirator, Iran Zavala, also 29 and from Dallas, was sentenced by Judge Boyle in August 2016 to 235 months in federal prison after he pleaded guilty in April 2016 to the same offense. 

According to documents filed in the case, beginning in approximately June 2015, Veliz, Zavala and others agreed to distribute methamphetamine.  On approximately June 29, 2015, Zavala negotiated the sale of two kilograms of methamphetamine for $32,000 to a person he later learned was an undercover law enforcement officer.

A few days later, on July 2, 2015, Veliz and Zavala traveled to a gas station on N. Beltline Road in Grand Prairie, Texas, to distribute more than 50 grams of methamphetamine to a person Veliz believed to be one of Zavala’s customers.  They had both the methamphetamine and a handgun belonging to Zavala in their pickup truck.  However, prior to the drug transaction being completed, law enforcement in marked patrol cars attempted to pull over their vehicle.  Rather than stop, Zavala fled in the truck at a high rate of speed, and during the chase, Zavala threw the methamphetamine out of the driver’s side window.  The firearm was thrown out of the passenger side window. 

At Zavala’s sentencing hearing, testimony was presented that Zavala intentionally drove his pickup truck at a high rate of speed toward an officer with the Grand Prairie Police Department who was attempting to lay a spike strip in the road to deflate the tires on Zavala’s fleeing vehicle.  Zavala is charged in a pending Dallas County case with Aggravated Assault of a Public Servant.  

The pursuit ended when Zavala drove his truck into Mountain Creek Lake where it collided with a sailboat near the boat ramp.  Both Zavala and Veliz were arrested.  The firearm, a 9-milimeter semi-automatic pistol, was recovered and ordered forfeited to the government.

The Drug Enforcement Administration and the Grand Prairie Police Department investigated the case.  Deputy Criminal Chief Assistant U.S. Attorney Rick Calvert was in charge of the prosecution.  

# # #

LUBBOCK, Texas — Two Littlefield, Texas, men, Juan Carlos Lara-Ochoa and Jose Alberto Cibrian, pleaded guilty this morning before U.S. Magistrate Judge D. Gordon Bryant Jr. to their roles in a methamphetamine distribution conspiracy, announced U.S. Attorney John Parker of the Northern District of Texas.

Lara-Ochoa, 24, admitted that on June 1, 2016, he possessed with intent to distribute 50 grams or more of methamphetamine.  He faces a statutory sentence of not less than 10 years and up to life in federal prison and a $10 million fine.  Cibrian, 41, admitted that on March 4, 2016, he possessed with intent to distribute a mixture or substance containing a detectable amount of methamphetamine.  He faces a maximum statutory sentence of 20 years in federal prison and a $1 million fine.  Judge Bryant ordered a presentence investigation report for each defendant with sentencing dates to be set after the completion of those reports.

Three additional defendants charged in the case, Jonathan Lovato, 33, Arleen Theres Keithley, 36, and Crystal Ann Alaniz, 32, are scheduled to enter guilty pleas on Monday, November 7, 2016.

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.  He is scheduled to be sentenced on December 2, 2016, by Senior U.S. District Judge Sam R. Cummings.

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 case is being investigated by the Lubbock Police Department, the Littlefield Police Department, the Texas Department of Public Safety and the Bureau of Alcohol, Tobacco, Firearms and Explosives.  Assistant U.S. Attorney Sean Long is in charge of the prosecution.

# # #      

DALLAS — A federal grand jury in Dallas returned a seven-count indictment yesterday charging Gary Michael Beach of Dallas with various offenses stemming from his filing a petition for voluntary bankruptcy in early December 2011, announced U.S. Attorney John Parker of the Northern District of Texas.

Specifically, the indictment charges Beach, 65, with five counts of making false statements under penalty of perjury and two counts of providing false testimony under oath.  If convicted, each count charged in the indictment carries a maximum statutory penalty of five years in federal prison and a $250,000 fine.

Beach is scheduled to make his initial appearance in federal court Friday afternoon, before U.S. Magistrate Judge Irma C. Ramirez, at 1:00 p.m.

According to the indictment, Beach filed a petition for voluntary bankruptcy in the Northern District of Texas on December 2, 2011. 

On approximately September 13, 2010, Beach, Beach’s father, and Beach’s son formed the Beach 2010 Trust.  From approximately December 2009 through July 2011, Beach received approximately $177,500 from the Beach 2010 Trust and two other family trusts.  On August 29, 2011, a final civil judgment in Harris County, Texas, was entered against Beach personally that required him to pay an award of $812,000 plus post-judgment interest.

On November 29, 2011, Beach and his co-trustee son caused the Beach 2010 Trust to spend $857,500 of Beach 2010 Trust funds to purchase property (Beach’s personal residence) on Beverly Drive in Dallas.  Then, from December 13, 2011, through April 30, 2012, Beach and his son caused the Beach 2010 Trust to spend an additional $35,901 for renovation work on the residence, bringing the total spent on the residence to approximately $893,401.

In late October 2009, Black Horse Resources, LLC was formed; it was owned/managed by Beach’s brother-in-law.  On April 1, 2011, Black Horse entered into a partnership agreement with the Beach 2010 Trust, and on June 29, 2011, Beach caused the Beach 2010 Trust to assign its interest in the partnership agreement to the newly-formed Beach Petroleum, LLC.  Beach caused the “Articles of Organization” for Beach Petroleum to be filed with the Nevada Secretary of State’s office.

From approximately April 2011 through at least May 23, 2012, Beach fraudulently concealed from the bankruptcy court, the United States Trustee, and creditors his connection to Beach Petroleum and his receipt of Black Horse consulting fees through Beach Petroleum.  From April 2011 through May 3, 2012, Beach received a total of approximately $210,000 from Black Horse – all paid directly to Beach or indirectly to Beach through Beach Petroleum. 

The five false statement counts charged relate to documents Beach submitted in his bankruptcy case in which he fraudulently concealed material information concerning income received that he knew he was legally obligated to disclose.  The two false testimony under oath counts allege that Beach falsely testified under oath when he continued to conceal these consulting fees at his creditors’ hearing in January 2012, and again at his bankruptcy deposition in April 2012.

An indictment is an accusation by a federal grand jury, and a defendant is entitled to the presumption of innocence unless proven guilty. 

This case is one of several felony prosecutions of bankruptcy-related crimes generated by the Bankruptcy Fraud Initiative in the Northern District of Texas.  Beach is the 21st defendant to have been charged as part of that initiative; 16 have been convicted, one resulted in a mistrial, and four are pending trial.

The U.S. Postal Inspection Service is investigating the case.  Assistant U.S. Attorney David Jarvis is in charge of the prosecution.

# # #

DALLAS — Nancy Pineda, 27, of Farmers Branch, Texas, remains in federal custody today following her arrest late Friday evening by investigators with the Farmers Branch Police Department and special agents with the Drug Enforcement Administration on a federal criminal complaint stemming from her selling the heroin that caused a young woman’s overdose death at a McDonald’s restaurant in Farmers Branch in June 2016.  The announcement was made today by U.S. Attorney John Parker of the Northern District of Texas.

“This is yet another tragic example of a young life cut short by heroin,” said U.S. Attorney Parker.  “You have my word that every time someone dies from a drug overdose in this district, my office will do everything in our power, working with our law enforcement partners, to identify and prosecute those who sold the drugs.  We’re going to hit this problem, and we’re going to hit it hard.” 

Specifically, the complaint charges Pineda with conspiracy to distribute heroin.  Pineda made her initial appearance in federal court this afternoon before U.S. Magistrate Judge Irma C. Ramirez, who ordered that she remain in custody pending a detention hearing set for Thursday, November 3, 2016, at 2:00 p.m.

According to the affidavit filed with the complaint, on June 8, 2016, at approximately 9:43 p.m., a female victim was found dead in the bathroom of a McDonald’s restaurant located on Valley View Lane in Farmers Branch.  Based on observations of the scene, law enforcement suspected the victim’s death was the result of a heroin overdose.  This was confirmed by the Office of the Medical Investigator that determined the victim’s cause of death was due to the toxic effects of heroin and ethanol.

The investigation revealed that on June 8, 2016, at 7:00 p.m., the victim negotiated, in text messages, to buy a “dub” and a “point” from an individual, later identified as “A.J.”  A “dub” is slang for .20 grams of narcotics, and a “point” is slang for a syringe.  The text conversation concluded at 7:45 p.m. when the victim texted, “we down the street.” 

A search warrant of A.J.’s cell phone revealed text conversations between A.J. and an individual listed in his phone as “Nina,” who was later identified as defendant Nancy Pineda, a known heroin dealer with whom law enforcement was familiar because of previous narcotics investigations.

The text conversations between Pineda and A.J. began on June 8, 2016, at 7:08 p.m. and concluded at 7:25 p.m.  During the text conversation, A.J. negotiated with Pineda to obtain a “piece” at Taqueria El Paisano on Lombardy Drive in Dallas.  “Piece” is slang for narcotics.  A.J. then used the victim’s phone to text Pineda at 7:59 p.m. to advise her they were almost at Paisano’s.

The investigation further revealed that A.J. and the victim drove together to Paisano’s to meet Pineda.  Surveillance video showed A.J. exiting the car and talking on the phone.  A.J. then handed the telephone to the victim and ran to a nearby Sonic restaurant.  At approximately 8:13 p.m., A.J. walked up to a silver Ford sedan parked at the Sonic restaurant and made a hand-to-hand transaction with the front seat passenger, Pineda, and then walked away.  A few minutes later, A.J. returned to the car at Paisano’s, and he and the victim departed.  A.J. purchased the heroin directly from Pineda at the Sonic restaurant and gave it to the victim immediately afterwards. 

Law enforcement confirmed that Pineda knew the victim and had sold heroin to her on a regular basis in the past.

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 federal grand jury for indictment.  The statutory maximum penalty for the charged offense is 20 years in federal prison and a $1 million fine.

The Farmers Branch Police Department and the Drug Enforcement Administration are investigating the case.  Assistant U.S. Attorney Myria Boehm is in charge of the prosecution.

# # #

DALLAS — A Garland, Texas, man, Brian Dwayne Glass, 35, was sentenced this afternoon by Chief U.S. District Judge Barbara M. G. Lynn to 84 months in federal prison, following his guilty pleas in February 2016 to six counts of bank robbery.

Glass admitted robbing six banks, entering each of the banks with the intent to commit bank robbery.  He acted similarly in each robbery, entering the bank during the late morning or early afternoon hours and verbally demanding from a teller, in an intimidating manner, that they give him all of their money.  In one instance, Glass also grabbed approximately $5,000 cash that was laid out on the counter by a bank customer who was in the process of depositing the cash.

Glass committed the following bank robberies:

            July 25, 2014                          Chase Bank
                                                            4430 Lavon Drive
                                                            Garland, Texas

            August 14, 2014                     Chase Bank
                                                            5525 North Garland Avenue
                                                            Garland, Texas

            September 29, 2014                Chase Bank
                                                            1000 South Beltline Road
                                                            Coppell, Texas

            November 4, 2014                  Bank of America
                                                            5610 Broadway Boulevard
                                                            Garland, Texas

            November 10, 2014                Chase Bank
                                                            4430 Lavon Drive
                                                            Garland, Texas

            January 27, 2015                     Chase Bank
                                                            18220 Midway Road
                                                            Dallas

The FBI and the Coppell, Dallas and Garland Police Departments investigated.  Assistant U.S. Attorney Keith Robinson prosecuted.

# # #

Thursday, October 27, 2016, at 2:00 p.m.

U.S. Attorney’s Office
George Mahon Federal Building

1205 Texas Avenue, Suite 700
Lubbock, Texas

 

John Parker, United States Attorney, Northern District of Texas

Matt Powell, District Attorney, Lubbock County

Greg Stevens, Chief, Lubbock Police Department
Calvin Bond, Assistant Special Agent in Charge, DEA Dallas

Charles Cobb, Resident Agent in Charge, HSI Lubbock

Mike Reed, Chief Deputy, Lubbock County Sheriff’s Office

Gary Albus, Regional Commander, Texas Department of Public Safety

 

A Press Conference will be held today, Thursday, October 27, 2016, at 2:00 p.m. at the U.S. Attorney’s Office in Lubbock, Texas, to announce a critical law enforcement action.  While no further information can be provided at this time about the specific enforcement action, members of the media may contact Kathy.Colvin@usdoj.gov regarding logistical questions.

 

 

# # #

LUBBOCK, Texas – Following a law enforcement operation this morning, led by officers with the Lubbock Police Department and special agents with the Drug Enforcement Administration (DEA), three Lubbock, Texas, residents were arrested on a federal criminal complaint charging them with conspiracy to distribute and possess with intent to distribute fentanyl, a highly potent synthetic opioid.

 

Today’s announcement was made at a news conference this afternoon hosted by John Parker, U.S. Attorney for the Northern District of Texas; Matt Powell, Lubbock County District Attorney; Greg Stevens, Chief, Lubbock Police Department; Calvin Bond, Assistant Special Agent in Charge, DEA; Charles Cobb, Resident Agent in Charge, U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI), Lubbock; Mike Reed, Chief Deputy, Lubbock County Sheriff’s Office; and Gary Albus, Regional Commander, Texas Department of Public Safety.

 

Sidney Caleb Lanier, 36, was arrested at his home on 154th Street.  Jessica Christine Holl, 28, and Jamie Marie Robertson, 32, were arrested at their apartment on 4th Street.

 

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

 

According to the criminal complaint, from approximately January 2013 to October 27, 2016, defendants 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.

 

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 maximum statutory penalty for the offense charged is 20 years in federal prison and a $1 million fine.

 

This law enforcement operation 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.

 

 

# # #

DALLAS — An Irving, Texas, businessman, Narasimha Bhogavalli, 50, was arrested yesterday morning by special agents with the Federal Bureau of Investigation on a federal complaint charging him with engaging in monetary transactions in property derived from specified unlawful activity in connection with an Internal Revenue Service (IRS) impersonation scam that defrauded victims of money that Bhogavalli then transferred between accounts and wired to India.  The announcement was made today by U.S. Attorney John Parker of the Northern District of Texas.

Bhogavalli made his initial appearance yesterday afternoon before U.S. Magistrate Judge Paul D. Stickney, who ordered him detained pending a detention hearing set for tomorrow, Friday, October 28, 2016, at 2:00 p.m., before U.S. Magistrate Judge Renée Harris Toliver.

According to the complaint, victims from throughout the U.S. were contacted by individuals claiming to be IRS agents.  Victims were advised there were outstanding warrants for their arrest and they would be sent to jail unless they deposited money orders, and sometimes cash, into bank accounts controlled by Bhogavalli and other accounts used by co-conspirators in the scam. 

Bhogavalli used at least two Bank of America accounts in the scam, one in the name of Tekdynamics, Inc. and one in the name of Touchstone Commodities, Inc.  The investigation revealed that Bhogavalli also controlled additional accounts used in the money soliciting scam, including a Citibank account held in the name of Touchstone Commodities. 

Between November 5, 2014, and February 2, 2015, approximately 242 deposits of cash and money orders, totaling approximately $1,661,247, which includes at least 2,250 separate money orders totaling $1,493,848 were made in one of the Bank of America accounts.  During the two-week period, between approximately January 16, 2015, and January 30, 2015, at least 60 money orders, totaling $37,957 were deposited into the other Bank of America account.  Between November 4, 2014, and February 5, 2015, at least 128 money orders, totaling $96,716 were deposited into the Citibank account.

A financial analysis of those accounts, according to the complaint, shows that immediately following the deposits made by the victims of the money soliciting scam, the proceeds were wire transferred to other accounts Bhogavalli controlled, where he either spent the funds or wired the funds to accounts in other countries, such as India.  Numerous wire transfers were made in amounts greater than $10,000.

Records indicate Bhogavalli was listed as the Director of Touchstone Commodities, located at 1425 Greenway Drive, Suite 650, in Irving.  In account opening documents, Bhogavalli characterized Touchstone Commodities as an “import-export” business.  On its website, Touchstone Commodities is “experienced in the global sourcing and supply of many valuable commodities,” including iron ore, steel and wood chips.  Bhogavalli is listed as Chairman of Touchstone Commodities on its website.

Records indicate Bhogavalli was listed as President of Tekdynamics.  According to information on the Tekdynamics website, Tekdynamics is a provider of “technology, outsourcing and consulting needs” with established infrastructure in the U.S. and India.  Tekdynamics address is listed as 1425 Greenway Drive, Suite 650, in Irving.  

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 maximum statutory penalty for the charged offense is 10 years in federal prison and a $250,000 fine. 

The investigation is being conducted by the FBI and the U.S. Treasury Inspector General for Tax Administration (TIGTA).  Assistant U.S. Attorney J. Nicholas Bunch is in charge of the prosecution.

# # #

DALLAS — Ellis Wamsley, IV of Grand Prairie, Texas, was sentenced today by U.S. District Judge Jane J. Boyle to serve 54 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 Kevin Kenard Howard and the FAIM Economic Development Corporation, announced U.S. Attorney John Parker of the Northern District of Texas. 

Specifically, Wamsley, 47, pleaded guilty to one count of engaging in a monetary transaction with property derived from specified unlawful activity and aiding and abetting.  Judge Boyle ordered that he surrender to the Bureau of Prisons on November 30, 2016.

Co-defendant Howard, 34, of Duncanville, Texas, pleaded guilty in May 2016 to one count of wire fraud.  He faces a maximum statutory penalty of 20 years in federal prison a fine not to exceed $250,000 or twice any pecuniary gain to the defendant, and restitution.  He is scheduled to be sentenced by Judge Boyle on December 8, 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.  FAIM and Company R signed a joint venture agreement in July 2010 that represented to investor M.R. and Company R that FAIM would provide a monthly financial report regarding the performance of the trading.  Wamsley and Howard told M.R. that M.R.’s funds would only be invested in certain types of investments identified in the agreement and that all investment profits would be split equally between FAIM and M.R.

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, with Wamsley’s knowledge and consent, 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.  In court filed documents, Wamsley admitted that he caused a total investor loss of $1,850,000 as a result of this investor fraud scheme.

This case is one of several felony prosecutions of bankruptcy-related crimes generated by the Bankruptcy Fraud Initiative in the Northern District of Texas.  Wamsley is the 16th defendant convicted since July 2014 as part of that initiative. 

Internal Revenue Service Criminal Investigation investigated the case.  Assistant U.S. Attorney David Jarvis prosecuted.

# # #

LUBBOCK, Texas — Benny T. Martinez, 37, of San Angelo, Texas, made his initial appearance today before U.S. Magistrate Judge E. Scott Frost on a complaint, unsealed today, charging possession with intent to distribute 500 grams or more of methamphetamine, announced U.S. Attorney John Parker of the Northern District of Texas.

Judge Frost ordered that Martinez remain in federal custody.  A preliminary hearing is set for November 9, 2016.

The investigation began when the Texas Department of Public Safety (DPS) received information that Martinez resided at a location that was being used as a multi-pound methamphetamine stash site, and that Martinez was responsible for the distribution of multiple pounds of methamphetamine, per month, throughout the San Angelo area.

A search warrant was executed at Martinez’s residence on Wilma Lane on October 21, 2016.  Martinez was located exiting the west bedroom of the residence.  The search of the residence revealed 2,188 gross grams of methamphetamine in the ceiling of the pantry, as well as two .22 caliber rifles, approximately $13,700 in cash, a vacuum sealer and food saver bags, a digital scale, rolls of plastic, and adulterants consistent with those used to dilute controlled substances.  The search yielded an additional 6,279 gross grams of methamphetamine buried on the north side of an outbuilding, in a small garden.

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 Texas DPS, the San Angelo Police Department, the Drug Enforcement Administration, and the Tom Green County Sheriff’s Office.  Assistant U.S. Attorney Jeffrey Haag is in charge of the prosecution.

# # #

DALLAS — Special agents with the U.S. Department of Housing and Urban Development (HUD) and the Federal Housing Finance Agency (FHFA), along with postal inspectors with the U.S. Postal Inspection Service (USPIS), arrested Francisco Javier Gonzalez, a/k/a “Javier Gonzalez,” Monday morning at his home in Duncanville, Texas, on a federal indictment, returned last week by a grand jury in Dallas, and just unsealed, which charges Gonzalez with 21 counts of mail, wire and bank fraud and aggravated identity theft stemming from his work at the Dallas County Community Action Committee, Inc. (DCCAC).  The announcement was made today by U.S. Attorney John Parker of the Northern District of Texas.

Gonzalez, 44, made his initial appearance in federal court yesterday afternoon before U.S. Magistrate Judge Paul D. Stickney, who ordered him detained pending trial. 

Specifically, the indictment charges Gonzalez with five counts of mail fraud, six counts of wire fraud, eight counts of bank fraud and two counts of aggravated identity theft.

The DCCAC was a non-profit entity, accredited by HUD between October 1990 and mid- February 2016, to provide housing counseling.  It was created in 1965 by the Dallas Commissioners Court to support the efforts of the Johnson administration to combat poverty.  DCCAC was located on East Jefferson Boulevard in the Oak Cliff area of Dallas.  Gonzalez served as DCCAC’s Vice President and one of the directors. Gonzalez also leased space in the DCCAC offices for another entity, known as Residential Counseling FJ LLC.

The indictment alleges that through his work at DCCAC, Gonzalez defrauded numerous homeowners under the guise that he was assisting them with mortgage assistance.  Instead, Gonzalez falsified paperwork, stole these homeowners’ mortgage payments, and extracted large payments from these homeowners in a claimed, but untrue, effort to unsuccessfully save their homes from foreclosure.  As a result of his fraud, these homeowners were defrauded of tens of thousands of dollars and many lost their homes; HUD also suffered a loss of approximately $659,859.00

Gonzalez, according to the indictment, specifically sought out victims who were facing financial difficulty and who had contacted the DCCAC seeking mortgage loan and foreclosure prevention assistance.  He also identified victims facing such financial distress by subscribing to the Foreclosure Listing Service, a/k/a Roddy List, which offers listings of foreclosure and pre-foreclosure homes, by county, through a review of public records.  Once identified, Gonzalez would meet with these victims in the DCCAC offices and in the victims’ homes.  He would explain a plan to reduce the victim’s mortgage payment and to prevent foreclosure; the plan often included a loan modification application. 

In many instances, Gonzalez would prepare and submit a Making Home Affordable Request for Mortgage Assistance modification application, pay stubs, Hardship Affidavits, and verifications of employment in an attempt to obtain the loan modification for these victims.  These documents often contained information that had been falsified by Gonzalez and were otherwise incomplete.  Banks would often deny these applications because they were incomplete. 

On some occasions, the indictment alleges, Gonzales told victims to not communicate with the banks as that would prevent him from effectively obtaining the loan modification.  He would tell these victims to stop making their mortgage payments to the bank and instead make the payments directly to him so that he could forward the funds to the bank.  Sometimes, he instructed the victim to make a large lump sum payment directly to him to stave off foreclosure, and he also often required a lump sum payment for his own services.  On almost all occasions, Gonzalez did not submit this money paid to him by the victims to the banks as he had promised, but instead used the money for his own personal expenses.

As a result of the failure to make mortgage payments and incomplete applications submitted to modify loans, banks would often begin the foreclosure process.  In some instances, Gonzalez would then mail a Real Estate Settlement Procedure Act (RESPA) Qualified Written Request to the bank in an effort to delay the foreclosure and extract additional funds from the victim.  Gonzalez also instructed some victims to file for bankruptcy in an effort to avoid foreclosure.

On some occasions, when a victim provided Gonzalez with a money order already made out to the bank, Gonzalez would alter it to make it payable to himself. 

An 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 mail fraud count carries a maximum statutory penalty of 20 years and a $250,000 fine.  Each wire fraud count and each bank fraud count carries a maximum statutory penalty of 30 years and a $1 million fine.  Each aggravated identify theft count carries a mandatory two years and a $250,000 fine.  

HUD Office of Inspector General, FHFA Office of Inspector General, and the USPIS are investigating the case.  Assistant U.S. Attorney P.J. Meitl is in charge of the prosecution.

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DALLAS – U.S. Attorney John Parker of the Northern District of Texas announced today that Assistant U.S. Attorney Mattie Compton will lead the efforts of his Office in connection with the Justice Department’s nationwide Election Day Program for the upcoming November 8, 2016, general elections.  AUSA Compton has been appointed to serve as the District Election Officer (DEO) for the Northern District of Texas, and in that capacity is responsible for overseeing the District’s handling of complaints of election fraud and voting rights abuses in consultation with Justice Department Headquarters in Washington.

 

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

 

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

 

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

 

The franchise is the cornerstone of American democracy.  We all must ensure that those who are entitled to the franchise exercise it if they choose, and that those who seek to corrupt it are brought to justice.  In order to respond to complaints of election fraud or voting rights abuses on November 8, 2016, and to ensure that such complaints are directed to the appropriate authorities, U.S. Attorney Parker stated that AUSA/DEO Compton will be on duty in this District while the polls are open.  The public may reach her at 682-667-6723.

 

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

 

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

 

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

 

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FORT WORTH, Texas — A former fugitive who was wanted for various offenses, including most recently, making a false statement on a passport application, pleaded guilty to that offense in federal court and has been sentenced by U.S. District Judge Reed C. O’Connor to 72 months in federal prison, announced U.S. Attorney John Parker of the Northern District of Texas.

Avniel Awan Anthony, 40, a U.S. citizen and former resident of Arlington, Texas, was taken into custody on April 14, 2016, by the Diplomatic Security Service (DSS) and the U.S. Marshals Service (USMS).  Anthony pleaded guilty in June 2016 to an indictment charging one count of false statement in passport application.

In documents filed in the case, Anthony admitted that in October 2013, he willfully and knowingly made a false statement in an application for a passport, when he knowingly falsely stated his name was “Dominic Dewayne Wilson” on the passport application he submitted at the U.S. Post Office located on E. Bardin Road in Arlington.  In support of that application, Anthony presented a postal clerk a Texas identification card bearing his photograph and the name “Dominic Dewayne Wilson,” and he falsely swore that the information on the application was true.

Anthony was a DSS fugitive wanted for passport fraud, identity theft, evading the police, and being a felon in possession of a firearm.  Anthony changed his identity and fled to Playa de Carmen, Mexico, where he remained a fugitive until DSS located him in March 2016.

DSS and the USMS coordinated with the Playa de Carmen Tourist Police and Mexican immigration officials to locate, arrest, and return Anthony to the U.S. to face charges. 

The DSS is the security and law enforcement arm of the U.S. Department of State with agents located in more than 160 countries worldwide.  DSS and the USMS work together to locate and return U.S. fugitives from abroad.

Assistant U.S. Attorney J. Michael Worley prosecuted the case.

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FORT WORTH, Texas — Six individuals, most with ties to the Polywood Crips street gang in Fort Worth, Texas, have been charged in a federal indictment with conspiracy to commit sex trafficking, sex trafficking of children, sex trafficking through force, fraud or coercion and related offenses.  Three additional defendants involved in the conspiracy, each charged in a criminal information, have entered guilty pleas.  The announcement was made today by U.S. Attorney John Parker of the Northern District of Texas.

Most of the defendants were arrested on July 21, 2016, on related charges, outlined in a criminal complaint following an operation conducted by special agents with the Bureau of Alcohol, Tobacco, Firearms and Explosives, U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI), the Fort Worth Police Department, and the U.S. Marshals Service.

Each of the below-listed defendants acted as a “pimp” and is charged with one count of conspiracy to commit sex trafficking:

Chad Johnson, a/k/a “Ocho Hood Fame,” 24
Diwone Nobles, a/k/a “Pooh,” 32
Audry Lane, a/k/a “Spud,” 29
Deon Bonner, a/k/a “Spanish Fly,” 26
Stanley Johnson, a/k/a “Pee Wee,” 24
Katelyn Michelle Ward, a/k/a “KD,” 24

In addition, Chad Johnson is charged with two counts of sex trafficking through force, fraud or coercion; one count of sex trafficking of children through force, fraud or coercion; and one count of sex trafficking of children.  Nobles is charged with one count each of sex trafficking through force, fraud or coercion; one count of sex trafficking of children through force, fraud or coercion; and one count of sex trafficking of children.  Audry Lane is also charged with two counts of sex trafficking through force, fraud or coercion and one count of sex trafficking of children.  Bonner and Stanley Johnson are also each charged with two counts of sex trafficking of children.

The three defendants who pleaded guilty on October 17, 2016, before U.S. District Judge Reed C. O’Connor, are:

Jessica Arnold, 23
Serrah Arnold, a/k/a “Kristen,” 28
Alvin Lane, a/k/a “Spank,”

Alvin Lane pleaded guilty to one count of conspiracy to commit sex trafficking of children.  Sisters Jessica and Serrah Arnold each pleaded guilty to one count of use of a facility of interstate commerce in aid of a racketeering enterprise.

The indictment alleges that beginning before June 1, 2013, though approximately July 21, 2016, the six defendants conspired and agreed with others to recruit, entice, harbor, transport, provide, obtain and maintain, female children victims under the age of 18, as well as adult victims, recklessly disregarding that force, threats of force, fraud and coercion and any combination of such means would be used to cause these victims to engage in commercial sex acts.

In the affidavit filed with the criminal complaint, one minor female victim was told by Nobles, Bonner, and Chad Johnson to charge $120 for a half hour and $180 for a full hour of commercial sex acts, and the three kept all of the money she received.  The victim feared Nobles and Chad Johnson because she had observed both become violent when angry and had observed Chad Johnson assault another female on several occasions when the female did not follow his instructions. 

Another minor female victim engaged in commercial sex acts at the direction of Stanley Johnson, who would post advertisements with her photo on Backpage.com.  All of the money she earned by engaging in commercial sex acts was given to Stanley Johnson.

An adult female victim engaged in commercial sex acts at the direction of Nobles, Chad Johnson, Audry Lane, Alvin Lane, and Serrah Arnold.  Nobles frequently assaulted her when she made him angry or did not follow his instructions; he also raped her.  Nobles kept the money she earned and the contact phone number used in the Backpage.com ad for her services was used by Nobles.   In one trip to Austin, this adult female victim made enough money for Nobles to buy a Chevy sedan that he painted bright orange – “Poly Orange” in reference to their neighborhood Polytechnic Heights – that he still owns.

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. 

When an adult female victim engaged in commercial sex acts at Audry Lane’s direction, he would have Serrah Arnold, his “bottom girl,” supervise the victim and take the money she received. 

A minor female victim engaged in commercial sex acts at the direction of Audry Lane, Alvin Lane, Serrah Arnold and Jessica Arnold.  Alvin Lane would have his girlfriend/bottom girl, Jessica Arnold post photos of her in ads that she placed on Backpage.com.  The minor female victim would give all the money she earned to Jessica or Serrah Arnold, who would then give the money to Audry Lane or Alvin Lane.

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 contains photos of him posing with large sums of cash while referencing commercial sex.  Several of Chad Johnson’s Facebook friends are females observed in Backpage.com ads for commercial sex. 

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

A federal complaint is a written statement of the essential facts of the offenses charged and must be made under oath before a magistrate judge; the government has 30 days to present the matter to a grand jury for indictment.  An 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 maximum statutory penalty of life in federal prison and a $250,000 fine. 

ATF, ICE HSI and the Fort Worth Police Department are investigating.  Assistant U.S. Attorney Cara Foos Pierce is in charge of the prosecution.              

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DALLAS - Daybreak Partners, LLC, a holding company for a number of subsidiaries that operate and manage skilled nursing facilities throughout Texas, has agreed to pay $5,300,000.00 to resolve allegations that they billed Medicare and Medicaid for materially substandard nursing services.  The skilled nursing facilities are operated as individual limited partnerships owned by Daybreak Venture, LLC and Daybreak Healthcare, Inc. (Daybreak).  Daybreak denies the allegations.  U.S. Attorney John Parker of the Northern District of Texas made the announcement today.

The settlement resolves allegations that between 2006 and 2010, some of the skilled nursing services provided at four nursing facilities Daybreak owned and managed (Deerings Nursing and Rehabilitation, L.P., Odessa, Texas; Mansfield Nursing and Rehabilitation, L.P., Mansfield, Texas; Marine Creek Nursing and Rehabilitation, L.P. Mineral Wells, Texas; and Mineral Wells Nursing and Rehabilitation, L.P., Mineral Wells, Texas) were materially substandard and/or worthless because Daybreak: (a) failed to follow appropriate fall protocols for several residents; (b) failed to follow appropriate pressure ulcer and infection control protocols for several residents; (c) failed to properly administer medications to several residents to avoid medication errors; (d) failed to follow doctors’ orders for several residents; (e) failed to provide appropriate mental health treatment to several residents; (f) failed to answer several residents’ call lights promptly; (g) failed to institute appropriate infection control measures for several residents; (h) failed to provide a habitable living environment, adequate equipment, and needed capital expenditures; and (i) failed to investigate and report serious incidents to appropriate authorities on several occasions.

“In addition to our responsibility to preserve federal tax dollars, we have a special obligation to protect the most vulnerable members of our community,” said U.S. Attorney Parker.  “This settlement reflects our commitment to ensuring that medical providers for our ailing friends and family are not paid for substandard services.”

As part of the settlement, Daybreak entered into a Corporate Integrity Agreement with the Office of Inspector General for Health & Human Services (OIG) that requires an independent monitor and allows the OIG to oversee the quality of care provided at all of Daybreak’s skilled nursing facilities over the next five years.  Daybreak cooperated throughout the course of the investigation.

This case was handled by Assistant U.S. Attorney Clay Mahaffey.

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DALLAS — Carl Keith Battie, a/k/a “Carl Hampton,” 60, was sentenced this morning by U.S. District Judge Sidney A. Fitzwater to 10 years in federal prison and ordered to pay $11,407,794 in restitution, following his guilty plea in June 2016 to a superseding indictment charging one count of conspiracy to commit wire fraud, announced U.S. Attorney John Parker of the Northern District of Texas.

Battie’s sentence will run concurrently with any sentence imposed in People of the State of California v. Carl Keith Battie, in the Superior Court of California, County of San Diego.  Battie has been in custody since his arrest on this related state case while he was living in Atlanta.  Battie must also forfeit property that was seized from his home in Atlanta, including a vehicle, U.S. and Iraqi currency, numerous jewelry items, and more than $100,000 seized from bank accounts. 

According to documents filed in the case, from approximately May 2011 to March 2014, Battie conspired with others, including “Person A,” to defraud investors in connection with the fraudulent sale, and offer of sale, of real estate investments.  Part of his scheme involved inducing victim investors to purchase mortgage notes based on material misrepresentations about the true value of the mortgage notes and the real property underlying the notes, for the personal enrichment of Battie, Person A, and others.

To further his scheme, Battie owned and operated several businesses entities, out of offices in Dallas, including Lien Exchange TX, LLC; Lien Exchange, Inc.; Family First NV, LLC; Loving Life Studios, LLC; WCM Direct, Inc.; and Entrust.  Person A also operated multiple business entities in Addison, Texas, in furtherance of the scheme.

Battie located and purchased distressed and dilapidates real estate, mostly in the St. Louis, Missouri, area, which had already been foreclosed upon by other financial institutions.  Battie, using the various business entities, flipped the properties one or more times over the course of several months or years to create the appearance of a market and inflate the appraised values of the properties.  At Battie’s direction, associates falsified signatures and notaries on property records that were later filed with the St. Louis County Clerk’s office and the City of St. Louis Recorder of Deeds.  In turn, Person A sold the fraudulently inflated mortgage notes to victim investors and then paid one of Battie’s companies from funds received from victim investors.

Battie directed Person A on how to “pitch” the investment opportunity to potential investors, typically senior citizens, at investment seminars at high-end restaurants.  Among other things, Person A made numerous factual and material misrepresentations about the value of the properties underlying the mortgage notes and the solvency of the company and omitted details about the condition of the properties.  For instance, Person A misrepresented that investors were purchasing a mortgage note for a rehabilitated property that had a stable, civil servant residing in the property who would make rent payments, when in reality, as Battie and Person A knew, many of the properties did not have any tenants, or in cases where tenants were living in the properties, they were not civil servants with steady income.

Over the course of the scheme, Battie acquired approximately 120 properties that he used in furtherance of his scheme.  Between June 2010 and February 2014, Battie and Person A, and others, raised approximately $12.5 million from victim investors and caused more than $7 million in losses.  In fact, at least 40 victim investors suffered significant financial hardship as a result of his scheme.

The case was investigated by the U.S. Securities and Exchange Commission, the California Department of Insurance, the California Department of Business Oversight, and the San Diego District Attorney’s Office. 

Assistant U.S. Attorney J. Nicholas Bunch was in charge of the prosecution.

 

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FORT WORTH, Texas – At a press event held this afternoon, U.S. Attorney John Parker of the Northern District of Texas, Assistant Special Agent in Charge Calvin Bond of Dallas DEA, and Executive Director Jennifer Gilley of Challenge of Tarrant County discussed their combined and continued efforts in raising awareness of the dangers of prescription drug abuse.  October 2016 has been proclaimed National Youth Substance Use and Substance Use Disorder Prevention Month by President Obama.

 

The press event was held at Cinemark Alliance Town Center in far north Fort Worth.  Stay on Track, a program of Challenge of Tarrant County, is sponsoring the theatre campaign in which Cinemark Alliance Town Center will run a public service announcement (PSA) –recently produced by the U.S. Attorney’s Office to address the dangers of prescription drug abuse – in advance of its feature films. 

 

Since the home medicine cabinet is the number-one source of prescription pills for teens and young adults, Assistant Special Agent in Charge Bond announced that this Saturday, October 22, 2016, is National Prescription Drug Take-Back Day, and stressed that Take-Back Day provides a safe, convenient and responsible means of disposing of unused prescription drugs.  There are numerous collection sites throughout the Dallas-Fort Worth metroplex; find the location closest to you here. 

 

Next week is also DEA Red Ribbon Week, the nation’s oldest and largest drug prevention program that reaches millions of Americans during the last week of October each year.  By wearing red ribbons and participating in community “Living Drug Free” events, youngsters pledge to live a drug-free lifestyle and pay tribute to DEA Special Agent Enrique “Kiki” Camarena, whose tragic murder in 1985 by drug traffickers in Mexico, where he was investigating that country’s biggest marijuana and cocaine traffickers, brought needed attention to the dangers of drugs and the international scope of the drug trade.

 

Challenge of Tarrant County continues its anti-drug efforts with PSAs in movie theatres in Tarrant County as well as during football games at the Keller ISD Athletic complex.  It has also sponsored billboards in Tarrant County with the messages “Don’t let a prescription become an addiction. Safe Use/Safe Storage/Safe Disposal,” and “Before it’s prescribed, you decide.”  Challenge of Tarrant County also has implemented prescription drug abuse prevention campaigns throughout Keller and Keller ISD.

 

Last month, Challenge of Tarrant County sponsored two highly successful events that brought community leaders and stakeholders together to address substance abuse prevention priorities, including prescription drug misuse and abuse in adolescents and young adults, underage drinking, and binge drinking.  One event, a Prescription Town Hall meeting in Keller was attended by more than 100 members of the Keller Community.  The other, a day-long symposium, “When the Prescription Becomes the Problem: A Community Response to the Opiate Epidemic” was attended by more than 800 individuals.

 

During Saturday’s Take-Back Day, Challenge of Tarrant County will be working with the Keller Police Department and Cook Children’s Pediatric, and their Lock Your Meds Campaign will run in conjunction with DEA’s Red Ribbon Week.

 

For more information about Stay on Track Challenge of Tarrant County, contact Cynthia Velazquez, program director, at Cynthia@tcchallenge.org

 

 

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Thursday, October 20, 2016, at 1:00 p.m.

Cinemark Alliance Town Center

9228 Sage Meadow Trail

Fort Worth, Texas

John Parker, United States Attorney for the Northern District of Texas

Calvin Bond, Assistant Special Agent in Charge DEA Dallas

Jennifer Gilley, Executive Director at Challenge of Tarrant County

During October 2016, proclaimed National Youth Substance Use and Substance Use Disorder Prevention Month, by President Obama, the U.S. Attorney’s Office for the Northern District of Texas, DEA Dallas, and Challenge of Tarrant County are joining together to announce their combined and continued efforts in raising awareness of the dangers of prescription painkillers, including:

• As an introduction, U.S. Attorney John Parker’s Public Service Announcement (PSA) on the dangers of opioid abuse will be shown.  Cinemark Theatre at Alliance Town Center will show the PSA prior to each feature film during the upcoming month.
• DEA’s National Prescription Take-Back Day on Saturday, October 22, 2016

• DEA’s Red Ribbon Week Campaign, October 23-31, 2016

For logistical information, please contact Cynthia Velazquez, program director for Stay on Track Challenge of Tarrant County at Cynthia@tcchallenge.org

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