Southern District of Texas

CORPUS CHRISTI, Texas – A 58-year-old Portland man has been sentenced to 19 years in federal prison following his conviction of conspiring to possess with the intent to distribute meth and possessing a firearm in furtherance of a drug trafficking crime, announced U.S. Attorney Jennifer B. Lowery.

Lance Esswein previously served as the commanding officer of the U.S. Navy Minesweeper U.S.S. Ardent. He was also the risk assessment manager for Nueces County and worked as an adjunct professor at Texas A&M Corpus Christi.

He pleaded guilty Jan. 30, 2020.

Today, Senior U.S. District Judge Janis Graham Jack sentenced Esswein to serve 168 and 60 months for the drug and firearms convictions, respectively. The sentences will be served consecutively for a total 228-month-term of imprisonment. The prison term will be immediately followed by five years of supervised release. In determining the sentence, Judge Jack found Esswein responsible for distributing more than 4.5 kilograms of “ice.”

At the hearing, the court heard additional evidence detailing the reasons for his less than honorable discharge from the U.S. Navy and the termination of his employment with Nueces County. The court also heard Esswein had offered to arrange the murder of two local police officers to prevent their testimony in an unrelated drug case.

Esswein had sold more than 100 grams of meth, after which authorities executed a search warrant at his Portland residence. There, they discovered additional meth and numerous firearms staged around the residence. He also had loaded assault rifles positioned just inside the front door.

The investigation revealed significant additional quantities of meth, other narcotics and firearms at storage units and vehicles Esswein controlled. They found a total of 36 weapons, including stolen firearms and firearms with missing serial numbers.

He has been and will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.

Homeland Security Investigations conducted the investigation. Assistant U.S. Attorney Robert D. Thorpe Jr. prosecuted the case.

CORPUS CHRISTI, Texas – A 28 year-old San Benito resident has been ordered to federal prison following his convictions for transporting illegal aliens with his tractor trailer, announced U.S. Attorney Jennifer B. Lowery.

Rene Garcia pleaded guilty Aug. 5, 2021.

Today, U.S. District Judge Drew Tipton sentenced Garcia to a total of 41 months in prison to be immediately followed by three years of term of supervised release. In handing down the sentence, Judge Tipton took into consideration the nature and facts of the case and noted Garcia had recently been convicted of transporting illegal aliens.

On May 13, 2021, Garcia arrived at the Falfurrias Border Patrol (BP) checkpoint driving a semi-truck and trailer. A K-9 alerted to the vehicle which prompted authorities to refer him to secondary inspection.

Ultimately, authorities found 51 undocumented individuals in the trailer, hidden among pallets of onions. At least one of them reported that it was hard to breathe and there was no way to escape in the event of an emergency.

Garcia later admitted to making arrangements with someone in San Benito to smuggle the aliens through the Falfurrias checkpoint and onto Houston.

He has been and will remain in custody pending transfer to a Bureau of Prisons facility to be determined in the near future.

Homeland Security Investigations and BP conducted the investigation. Assistant U.S. Attorney Patrick Overman prosecuted the case.

CORPUS CHRISTI, Texas – A 33-year-old Galveston man has entered a guilty plea to attempting to smuggle individuals in a flag-draped coffin, announced U.S. Attorney Jennifer B. Lowery.

Zachary Taylor Blood admitted to one count of alien smuggling.

On Oct. 26, 2021, Blood drove a grey van modified to transport caskets into the primary inspection lane of the Border Patrol (BP) checkpoint near Falfurrias. 

Authorities observed a coffin in the back of the van and asked what he was transporting. He replied “Dead guy, Navy guy.” However, the coffin was in poor condition and the American flag was taped to the top with packing tape.

Law enforcement then referred him to secondary inspection. There, they discovered two Mexican nationals, both unlawfully present within the United States, concealed inside the coffin. 

The two men admitted to paying a smuggler to get them to San Antonio. They claimed that after crossing the river into the United States, they were taken to a parking lot where Blood was waiting for them. He had them get into the coffin and began driving north.     

U.S. District Judge Nelva Gonzales Ramos will impose sentencing May 11. At that time, Blood faces up to five years in federal prison and a possible $250,000 maximum fine.  

He has been and will remain in custody pending that hearing.

BP conducted the investigation. Assistant U.S. Attorney Robert D. Thorpe Jr. is prosecuting the case.

McALLEN, Texas – Two local officials have admitted to their respective roles in a bribery scheme and will forfeit a total of nearly $1 million, announced U.S. Attorney Jennifer B. Lowery.

Penitas chief of staff Andres Morales, 41, Mission, and council member Alex Guajardo, 38, Penitas, pleaded guilty today. As part of the pleas, they have agreed to forfeit $739,910.71, and $202,000, respectively, which they retained as proceeds from the scheme. Morales also admitted to making false statements in connection with the purchase of a firearm.  

Both men were convicted of participating in a bribery scheme involving the payment of bribes and kickbacks to public servants and officials. The payments were in exchange for official votes or recommendations in support of granting energy savings contracts at various Hidalgo County political subdivisions.  

Morales and Guajardo admitted to receiving over $1 million and $275,000, respectively, and to paying thousands in bribe and kickback payments to others. Those included La Joya Independent School District trustees and an administrator in exchange for their official votes and recommendation of the projects. 

In addition, Morales also pleaded guilty to making false representations in connection with a purchase of a firearm. Specifically, he falsely claimed on firearms form 4473 that he had not been convicted of a felony, which, in fact, he had.

U.S. District Judge Ricardo H. Hinojosa accepted the pleas and set sentencing for April 6. At that time, each faces up to five years in federal prison for the bribery-related conviction. Morales also a maximum five-year-term of imprisonment for the firearms offense.

Both men were permitted to remain on bond pending that hearing.

The FBI conducted the investigation with the assistance of the Department of Agriculture, Texas Department of Insurance and McAllen Police Department. Assistant U.S. Attorney Roberto Lopez Jr. is prosecuting the case.

McALLEN, Texas – A 37-year-old Sullivan City resident has been ordered to federal prison after harboring individuals illegally in the country in harsh living conditions, announced U.S. Attorney Jennifer B. Lowery.

Emanuel Salinas Pleaded guilty May 14, 2021.  

Today, U.S. District Judge Randy Crane ordered he serve a total of 100 months in federal prison to be immediately followed by three years of supervised release. At the hearing, the court heard about the harsh living conditions to which the individuals were subjected. Judge Crane also considered the fact that some of them were unaccompanied minors, his record of convictions as well as the vehicle chase, during which he caused a collision.   

On Feb. 23, law enforcement was conducting surveillance of a residence suspected of harboring undocumented aliens in Edinburg. There, they observed a silver Jeep Grand Cherokee arrive and park outside the residence. Salinas was later determined to be the driver. Several individuals exited the residence and entered the Jeep, which departed and began travelling northbound before stopping at a parking area in San Carlos.

They attempted to conduct a consensual encounter with Salinas, but he immediately fled. He soon led authorities on a 20-mile vehicular pursuit. He did allow four people to exit the vehicle, but still had two others inside, one of whom was an unaccompanied minor. He then continued traveling in excess of 100 mph while weaving through traffic.

He ultimately collided with another vehicle in Edinburg.

Salinas admitted multiple aliens remained behind at the residence. Authorities discovered an additional 26 people, including another unaccompanied minor. The Edinburg location had foul conditions, to include trash piled up in the rooms and its septic tank overflowing onto the neighboring property.

Salinas has been and will remain in custody pending transfer to a U.S. Bureau of Prisons facility o be determined in the near future.

Customs and Border Protection conducted the investigation with the assistance of the Texas Department of Public Safety. Assistant U.S. Attorney Peter Brostowin prosecuted the case.

CORPUS CHRISTI, Texas – A 43-year-old Houston man has been ordered to prison after fraudulently purchasing two expensive vehicles using information purchased on the dark web, announced U.S. Attorney Jennifer B. Lowery.

Jay Patrick Morgan pleaded guilty Oct. 21, 2021.

Today, U.S. District Judge Nelva Gonzales Ramos ordered him to serve a 24-month sentence to be immediately followed by one year of supervised release. Morgan was also ordered to pay $31,409.37 restitution to compensate for damages and the diminished value of the recovered property. 

“Today’s sentencing is a reminder that the Secret Service is committed to aggressively investigating and pursuing financial crimes,” said Resident Agent in Charge Brian J. Gibson. “Identity theft investigations remain a top priority for us in our mission to protect this nation’s financial intuitions. The success in this case demonstrates the investigative capabilities of the Secret Service and the collaborative efforts with our law enforcement partners.”

On March 8, 2019, Morgan purchased a 2015 Ford F250 Platinum Edition

pickup truck, valued at more than $59,000. The following week, he also purchased a 2019 Rockwood 5th Wheel recreational vehicle (RV), valued at more than $57,000 from a dealer in the Corpus Christi area. In both instances, Morgan financed the total value of each vehicle by falsely providing the Social Security number and other identifying information of another individual with a similar name.

The victim later contacted authorities after discovering numerous credit inquiries and several new credit accounts he had not requested, including those used to purchase the pickup truck and RV. The investigation confirmed the victim had not opened any of the credit accounts and no payments had been made on any of the accounts. Both the pickup truck and the RV were listed as solen vehicles.   

In August 2019, local authorities conducted a traffic stop on the stolen pickup. Morgan was driving.

He admitted he acquired the pickup truck using a Social Security number he had purchased with Bitcoin currency from a site on the dark web. Morgan also admitted to fraudulently using the same information to purchase an RV which he had subsequently sold to another individual.

Morgan has been and will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.

The Secret Service conducted the investigation with the assistance of police departments in Corpus Christi and Deer Park. Assistant U.S. Attorney Robert D. Thorpe Jr. prosecuted the case.

CORPUS CHRISTI, Texas – A 39-year-old Corpus Christi resident has been ordered to federal prison after unlawfully possessing a firearm as a convicted felon, announced U.S. Attorney Jennifer B. Lowery.

Jacob Andrew Rosenblum pleaded guilty Sept. 23, 2021.

Today, U.S. District Judge Nelva Gonzales Ramos ordered him to serve a 77-month sentence to be immediately followed by three years of supervised release. At the hearing, the court heard additional information detailing Rosenblum’s extensive criminal history, including a recent successful escape from local law enforcement custody after being placed under arrest for an unrelated offense.

On March 29, 2021, authorities observed Rosenblum attempting to break into a storage container. As they approached, he fled which led to a brief foot pursuit.

Law enforcement began to detain him, but quickly observed him attempting to move his hands towards his waistband. Officers then located a revolver containing five rounds of ammunition concealed within his waistband area.

They also found to be in possession of multiple locks and a master key. The investigation revealed he had previously used the same key to slip out of custody on a previous occasion and flee on foot.

Rosenblum will return to state custody to serve that sentence and later transferred to a U.S. Bureau of Prisons facility to be determined in the future.

The Bureau of Alcohol, Tobacco, Firearms and Explosives conducted the investigation with the assistance of the Corpus Christi Police Department. Assistant U.S. Attorney Roland Swanson prosecuted the case.

HOUSTON – Two South Texas men have pleaded guilty and received significant sentences for their convictions related to an ongoing racketeering conspiracy, announced U.S. Attorney Jennifer B. Lowery.  

Mike Bueno, 50, Edinburg, and Octavio Muniz, 45, McAllen, admitted their roles in the TCB racketeering conspiracy today and were immediately sentenced.

Today, U.S. District Judge Sim Lake sentenced Bueno 262 months in federal prison, while Muniz received a 151-month term of imprisonment.  

In handing down the sentences, Judge Lake found Bueno to be a ranking member of the Tri City Bombers (TCB). The court noted his involvement in an ongoing marijuana trafficking conspiracy, a carjacking and a home invasion burglary that resulted in the death of the homeowner. The homeowner’s son was also shot, but survived and was present in court for today’s hearing.

The court found Muniz to be involved in the distribution of marijuana and an attempted murder of a woman the enterprise was hired to kill. The victim was shot six times, but survived.

The TCB is a national gang active in multiple states that was formed in the early 1980s in the Pharr, San Juan and Alamo areas of South Texas. The TCB have an organized decision-making hierarchy, including a person in charge of each city and leaders within the organization who determine whether its members violated the gang’s rule and deserved punishment. To instill loyalty, including participation in gang’s criminal activities and adherence to its strict rule structure, TCB leaders determine and order the severe beating of members and associates for acts of disobedience or non-observance of TCB rules.

The scope of the TCB’s crimes is wide-ranging and consistent in its nationwide operation. This RICO conspiracy includes murder, attempted murder, drug trafficking, firearm crimes, money laundering and other crimes in furtherance of the organization’s enterprise. The TCB brought money into the gang through murders, drug trafficking, home invasion robberies and money laundering.

To date, 25 individuals have been convicted in the case.

Bueno and Muniz have been in custody since their arrests and will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.

The FBI led the Organized Crime Drug Enforcement Task Force (OCDETF) investigation dubbed “Operation Bomb Disposal,” along with IRS-CI, Drug Enforcement Administration, Customs and Border Protection, Texas Alcoholic Beverage Commission, Hidalgo County Sheriff’s Office and police departments in McAllen, Mission, Edinburg, Weslaco and Pharr. OCDETF identifies, disrupts and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found on the Department of Justice’s OCDETF webpage.

Assistant U.S. Attorneys Anibal J. Alaniz and Casey N. MacDonald of the Southern District of Texas are prosecuting the case.

BROWNSVILLE, Texas – A 32-year-old local man has been ordered to federal prison for possession with intent to distribute more than 100 kilograms of marijuana, announced U.S. Attorney Jennifer B. Lowery.

Carlos Torres, Brownsville, pleaded guilty April 15, 2021.

Today, U.S. District Judge Rolando Olvera ordered Torres to serve a 31-month sentence to be immediately followed by two years of supervised release.

On Oct. 21, 2020, authorities observed a white pickup truck floating across the Rio Grande River from Mexico into the United States. After arriving onshore, the vehicle headed north toward a gap in the border fence.

Authorities noticed a male, later identified as Torres, driving the truck and activated the emergency lights to conduct a vehicle stop. He drove the vehicle into an open field in an attempt to flee, but eventually drove off a small embankment into a water-filled sandpit. Authorities searched the truck and found 17 bundles of marijuana weighing 184.47 kilograms.

The drugs had an estimated value of $325,360. 

Torres has been and will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.

The Drug Enforcement Administration and Border Patrol conducted the investigation. Assistant U.S. Attorney David Coronado prosecuted the case.

HOUSTON - A 27-year-old Houston resident is now in custody following charges he robbed a CVS and an Exxon Mobil, announced U.S. Attorney Jennifer B. Lowery.

The criminal complaint, filed today, charges DaVonte Williams with interference with commerce by robbery and brandishing a firearm during and in relation to a crime of violence. He is currently in federal custody and set for initial appearance before a U.S. magistrate judge Tuesday, Jan. 18 at 2 p.m.

According to the charges, Williams robbed a CVS on Tidwell shortly after doing same at an Exxon Mobil on Eastex Freeway late Jan. 12. Williams allegedly entered the CVS wearing a red ski mask, pointed a handgun at an employee and demanded cash. He then exited the store and entered a Lincoln Town car, according to the charges. 

The complaint alleges law enforcement attempted to stop the vehicle, but the driver refused and began a high-speed chase. Eventually, another vehicle was struck which resulted in injuries and deaths, according to the charges. However, the Lincoln Town Car allegedly continued to flee and escaped.

The investigation led to Williams and the suspect Lincoln Town Car, according to the charges.

Authorities later located him and took him into custody.

If convicted, he faces up to 20 years in federal prison for the robbery. Upon any conviction relating to the gun charges, he must also serve a minimum of seven years that must be served consecutively to any other prison term imposed.

The Bureau of Alcohol, Tobacco, Firearms and Explosives; Harris County Sheriff’s Office; Houston Police Department and the Texas Department of Public Safety - all members of the Crime Gun Strike Force - conducted the investigation. Assistant U.S. Attorney Jill Stotts is prosecuting the case.

This is an example of coordination between law enforcement who are part of the Houston Law Enforcement Violent Crime Initiative which combines personnel and resources from numerous federal, state and local agencies. The goal is to proactively fight and reduce violent crime across the Greater Houston area by targeting the region’s most violent offenders, augmenting investigative and prosecutorial efforts and enhancing training, public awareness and education. It stems from the Project Safe Neighborhoods (PSN) Program. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them.

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

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

BROWNSVILLE, Texas – A 20-year-old Mexican citizen faces up to life in prison after pleading guilty to conspiring to transport over four thousand pounds of marijuana, announced U.S. Attorney Jennifer B. Lowery.

Jorge Monjaraz-Perez pleaded guilty today.

At the hearing, he admitted he conspired with a drug trafficking organization to move at least 1,886 kilograms of marijuana. 

He also acknowledged running a marijuana stash house in Brownsville and that he participated in at least seven drug trafficking events. Law enforcement seized all the marijuana, each ranging between 91 kilograms and 528 kilograms.

U.S. District Judge Fernando Rodriguez Jr. will impose sentencing April 19. At that time, Monjaraz-Perez faces up to life in prison.

He has been and will remain on bond pending that hearing.

The FBI and Drug Enforcement Administration conducted the investigation with the assistance of Border Patrol and Texas Department of Public Safety. Assistant U.S. Attorney David A. Lindenmuth is prosecuting the case.

CORPUS CHRISTI, Texas – A 33-year-old Rio Hondo resident has been ordered to federal prison after selling large amounts of meth from a Corpus Christi residence, announced U.S. Attorney Jennifer B. Lowery.

Gustavo Adolfo Garcia pleaded guilty Oct. 21, 2021.

Today, U.S. District Judge Nelva Gonzales Ramos ordered him to serve a 188-month term of imprisonment to be immediately followed by five years of supervised release. In handing down the sentence, the court noted Garcia’s repeated criminal conduct.

In late 2020, law enforcement began investigating narcotics sales out of a home in Corpus Christi.

The operation resulted in several arrests outside the home and led to the identification of Garcia and others who were selling various drugs out of the residence.

On Dec. 29, 2020, authorities conducted a search and discovered 3.198 kilograms of pure meth, 518.93 grams of cocaine and other controlled substances.

Garcia took responsibility for the all the meth found in the home. He also admitted he had sold it through the back door of the residence.

Garcia has been and will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.

The Drug Enforcement Administration conducted the investigation with the assistance of police departments in Corpus Christi and Robstown. Assistant U.S. Attorney Joel Dunn prosecuted the case.

HOUSTON – A 48-year-old local man has been taken into custody on charges of obtaining over $600,000 from elderly victims throughout the country, announced U.S. Attorney Jennifer Lowery.

Authorities arrested Anthony Munigety, 48, today. He is expected to make his initial appearance before U.S. Magistrate Judge Edison at 2 p.m. Also charged is Ravi Kumar of Noida, India. He is believed to be in India and considered a fugitive. A warrant remains outstanding for his arrest.  

A federal grand jury returned a 20-count indictment Dec. 15, 2021.

According to the allegations, the fraud ring operated out of the Conroe area and other locations in the United States and India. Munigety, Kumar and others allegedly committed various fraud schemes targeting primarily elderly victims throughout the United States.

The primary objective, according to the indictment, was to deceive victims by telling them a technical support company or other entities were purportedly helping them with their computers. They would allegedly trick victims into believing they had been erroneously refunded or overpaid and needed to return the overpayment.

The indictment alleges they were able to gain access to a victim’s computer. This enabled Munigety, Kumar and others to move funds between or wire transfer monies out of their accounts, according to the charges. Once that occurred, Munigety and others would keep a portion of the money and wire the remainder to Kumar in India, according to the charges. 

As a result of their scheme, Munigety and others allegedly received over $600,000 from elderly victims.

Munigety and Kumar are charged conspiracy to commit money laundering, 13 counts of wire fraud and six counts of money laundering.

If convicted, they face up to 20 years on each count as well as a possible $250,000 maximum fine.

IRS – Criminal Investigation and FBI conducted the investigation. Assistant U.S. Attorney Quincy L. Ollison is prosecuting the case.

The U.S. Attorney’s Office for the Southern District of Texas is a member of the Department of Justice’s Elder Justice Initiative which combats elder abuse, neglect and financial fraud and scams that target our nation’s seniors.

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

HOUSTON - A 36-year-old Houston resident has been ordered to federal prison for wire fraud, possession of meth and possession of a firearm by a felon, announced U.S. Attorney Jennifer B. Lowery.

Steven Nguyen pleaded guilty April 27, 2021.

Today, U.S. District Judge Charles Eskridge ordered him to serve a 110-month sentence to be immediately followed by four years of supervised release. At the hearing, the court heard additional information that detailed Nguyen’s long criminal history. In handing down the sentence, Judge Eskridge noted his continued criminal behavior and the serious nature of the offenses.

In October 2019, Nguyen used a victim’s information to apply for a vehicle loan in Georgia. Law enforcement then opened an investigation into Nguyen’s role in a mail theft ring operating in the Houston area.

On April 30, 2020, authorities searched Nguyen’s residence and found approximately two kilograms of meth and 16 firearms, including several semi-automatic rifles equipped with military grade optics.

Nguyen will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future

The U.S. Postal Service and the Harris County Constable’s Office, Precinct 5, conducted the investigation. Assistant U.S. Attorneys Thomas Carter, Michael Day and Matthew Peneguy prosecuted the case.

McALLEN, Texas – A 33-year-old Mexican man has been sentenced for importing 4.6 kilograms of fentanyl and 43 kilograms of cocaine, announced U.S. Attorney Jennifer B. Lowery.

Nestor Carbajal-Alvarez pleaded guilty April 19, 2021.

Today, U.S. District Judge Randy Crane ordered him to prison for 60 months. Not a U.S. citizen, he is expected to face removal proceedings following the sentence. At the hearing, the sentencing, the defense argued for a minimal sentence since he was only acting as a “courier” and did not have much knowledge as to the overall drug trafficking scheme. However, the government contended it was a substantial load of controlled substances that could have potentially harmed many citizens.

On Jan. 29, 2021, Carbajal-Alvarez arrived at the Pharr Port of Entry with a shipment of limes. He was eventually sent to secondary inspection where authorities discovered the drugs hidden in the floor of the trailer.  

Carbajal-Alvarez admitted he knew his trailer contained narcotics and was delivering them to an unknown individual in McAllen.

The total estimated street value of the drugs was approximately $1,063,500.

Carbajal-Alvarez has been and will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.

Customs and Border Protection conducted the investigation with the assistance of Homeland Security Investigations. Assistant U.S. Attorney Eliza Carmen Rodriguez prosecuted the case.

McALLEN, Texas – A 42-year-old Penitas resident and La Joya Independent School District (ISD) trustee has admitted to receiving more than $234,000 in bribes, announced U.S. Attorney Jennifer B. Lowery.

Armin Garza admitted he participated in a conspiracy to steer lucrative energy savings contracts at various political subdivisions in Hidalgo County, including La Joya ISD.

In exchange, Garza and other co-conspirators received bribes and kickbacks from subcontractors selected to work on the energy savings contracts. As part of his plea, Garza admitted to using his influence over LJISD employees who were elected officials at other political subdivisions in Hidalgo County. The employees subsequently received promotions or pay raises. They also voted to award or attempted to award the same company energy savings contracts at three other political subdivisions in Hidalgo County. 

Garza admitted to receiving at least $234,500 in bribes and agreed to forfeit such amounts as part of his plea.

U.S. District Judge Ricardo H. Hinojosa set sentencing for March 18. Garza was permitted to remain on bond pending that hearing.

The FBI conducted the investigation with the assistance of the Bureau of Alcohol, Tobacco, Firearms and Explosives, Department of Agriculture-Office of Inspector General, Texas Department of Insurance and McAllen Police Department. Assistant U.S. Attorney Roberto Lopez Jr. is prosecuting the case.

HOUSTON - A 49-year-old Huffman resident has pleaded guilty to conspiracy to possess with intent to distribute more than five kilograms of cocaine, announced U.S. Attorney Jennifer B. Lowery.

Alexsander S. Reyes is a former Harris County Precinct 1 deputy constable.

On or about Dec. 5, 2020, Reyes escorted a tractor-trailer in a marked constable vehicle through Houston. They believed it contained 10 kilograms of cocaine.

For his assistance, Reyes received a total of $6000 in cash.

However, the drug load was actually part of an undercover operation and included “dummy” or fake cocaine.

Sentencing has been set for March 22 before U.S. District Judge Charles R. Eskridge III. At that time, Reyes faces a minimum of 10 years and up to life in prison as well as a $10 million maximum fine.

He has been and will remain in custody pending that hearing.

FBI Public Corruption conducted the investigation with assistance of Harris County Precinct 1 Constable’s Office, Houston Police Department and Texas Department of Public Safety.

Assistant U.S. Attorneys Carolyn Ferko and Heather Winter are prosecuting the case.

HOUSTON – A Houston clinic owner has have been ordered to federal prison following her convictions in an illegal kickback and money laundering scheme at a Harwin Drive business, announced U.S. Attorney Jennifer B. Lowery.

Anurag Dass aka Anna Dass, 49, Houston, pleaded guilty to illegal kickbacks and money laundering for her role in the scheme in August 2019. 

Today, U.S. District Judge Alfred Bennett ordered her to serve 24 months in prison to be immediately followed by two years of supervised release. She was further ordered to pay $2,242,899 in restitution.

Anna Dass operated A&A Pain and Wellness Center Inc. on Harwin Drive in Southwest Houston along with her brother Ankul Dass. Anna Dass admitted she submitted or caused others to file false claims with the Office of Worker Compensation Programs (OWCP) for patients Stephen Hunt directed to the clinic. Hunt was a former injured employee with the U.S. Postal Service (USPS) who filed his own injury claim with OWCP.

The Dass siblings conspired with Hunt for him to direct injured federal workers to the center for medical treatment and health care services. All three admitted Hunt would receive a fee as payment from the center for each claim OWCP paid. Hunt also charged a fee to injured federal workers he had referred for his representation and services through a company he controlled under the name “Zentec.” 

Anna Dass was the manager of Clinical Operations at the clinic, while Anukul Dass was the clinic director. Anna Dass filed false claims for services which were not authorized and not performed by a licensed physical therapist. Anna Dass admitted she received $2,242,899 in reimbursements from the unlawful activity.     

Hunt, 70, Waxahachie, and Anukul Dass aka Andy Dass, 44, Houston, were also convicted for their roles in the scheme – each pleading guilty to illegal kickbacks

Previously released on bond, Anna Dass was permitted to remain on bond and voluntarily surrender to a U.S. Bureau of Prisons facility to be determined in the near future.

The USPS - Office of Inspector General (OIG) and Department of Labor - OIG conducted the investigation. Assistant U.S. Attorneys Michael Day and Kristine Rollinson are prosecuting this case.

CORPUS CHRISTI, Texas - Three Houston gang members have been ordered to federal prison following their convictions of robbery and assaulting at least one customer at a Love’s Travel Stop, announced U.S. Attorney Jennifer B. Lowery.  

Christopher Bernard Brown aka Chris and C, 39, pleaded guilty Sept. 30, 2021.

Today, U.S. District Judge David S. Morales handed Brown a 90-month federal prison sentence to be immediately followed by three years of supervised release. He must also pay restitution. At the sentencing hearing, the court heard about approximately 33 related truck stop robberies and numerous employees and customers who were traumatized as a result of Brown’s and others’ actions.

Brown and Thomas Alec Buckley, 26, worked in concert with co-conspirators Wesley Jerome Davis, 28, and Kevin Wilson aka KCosa or KC, 33. They threatened or used physical force towards customers or employees to steal or attempt to steal ATMs and the currency they contained from at least nine Love’s Travel Stops throughout Texas and Louisiana. 

The multi-district and interstate Hobbs Act conspiracy occurred between May 29-Sept. 2019. During the robberies, Brown typically served as a scout or lookout while Davis, Wilson, Buckley or others wore masks and gloves and placed straps or chains around the ATMs. Then, a vehicle connected to the chains would accelerate to dislodge the bolted-down machines. Co-conspirators would lift the dislodged ATMs into the waiting vehicle and quickly drive away.

The attempts failed in Angleton, Natalia and Domino. However, the robbery crew was able to obtain monies from the stolen ATMs in Hungerford, Seguin, Lufkin, Cleveland, and Three Rivers as well as Vinton, Louisiana. 

In the Three Rivers robbery, co-conspirators came into contact with Love’s employees or customers, at which time Brown stated, “What are you gonna do?!! What are you gonna do?!!” The masked or hooded suspects also made menacing gestures towards the employees. Love’s Travel Stop employees did not intervene with the men for fear of sustaining serious bodily injury.

In Seguin, a good Samaritan attempted to stop the ATM robbery but Davis struck him twice, at which time he fell to the floor and suffered bodily injury from a head wound.

Davis and Wilson pleaded guilty July 29, 2021. Previously, Judge Morales sentenced Wilson to 90 months imprisonment, while Davis was ordered to serve a 60-month sentence. Wilson and Buckley also pleaded guilty in a related robbery case Nov. 22, 2019. 

Buckley remains on bond pending sentencing.

Brown will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.

Homeland Security Investigations conducted the investigation with the assistance of sheriff’s offices in Live Oak, Angelina, Brazoria, Wharton, Medina and Cass Counties; and police departments in Angleton, Cleveland, Seguin and Lufkin and Vinton, Louisiana. 

Assistant U.S. Attorney Reid Manning is prosecuting the case.

HOUSTON – The 27-year-old Spring man convicted of providing material support to a designated foreign terrorist organization has been ordered to prison for 12 years following reversal of original sentence, announced Acting U.S. Attorney Jennifer B. Lowery.   

Asher Abid Khan pleaded guilty Dec. 4, 2017, to providing material support to the Islamic State of Iraq and the Levant (ISIL) aka ISIS (the Islamic State of Iraq and al-Sham).

On June 25, 2018, U.S. District Judge Lynn H. Hughes downwardly departed from the U.S. Sentencing Guidelines and ordered Khan to serve a total of 18 months in prison. Following an appeal, the court resentenced him Dec. 23, 2019, again to serve the 18-month term of imprisonment. The government then again appealed to the U.S. Court of Appeals for the 5th Circuit, arguing the sentence was not reasonable for the severity of the offense committed.

That court granted to government’s appeal and ordered the judgment reversed and vacated, and the matter reassigned.

Today, U.S. District Judge Charles R. Eskridge sentenced Khan to 144 months in federal prison to be immediately followed by 15 years of supervised release. At the hearing, the court noted the strong condemnation by Congress regarding this conduct and that a young man died.

“Attempting to travel to wage violent jihad on behalf of ISIS is a serious act which deserves vigorous prosecution,” said Lowery. “The sentence imposed today accurately reflects the gravity of the crime for which Khan was convicted. We, along with the FBI’s Joint Terrorism Task Force, National Security Division and other partners, will continue to work to disrupt those trying to support foreign terrorist organizations here or abroad.”

“This outcome marks the culmination of a lengthy counterterrorism investigation highlighting FBI Houston’s steadfast dedication to our mission to fight all forms of terrorism,” said Acting Special Agent in Charge Richard A. Collodi of the FBI. “Khan pleaded guilty to material support of terrorism for recruiting and facilitating the travel of others to fight and die for ISIS overseas. Today’s sentence provides justice for Khan’s actions.” 

The investigation began in 2014 when Khan and his friend, who was living in South Texas, devised a plan to travel to Turkey and then to Syria for the purpose of fighting on behalf of ISIS. Khan had been living with a relative in Australia. Prior to leaving for Turkey from there, Khan told Mohamed Zuhbi, a Turkish-based foreign terrorist fighter facilitator, that he wanted to join ISIS.

Khan provided instructions to his friend on travel and how to reach him once Khan arrived in Turkey. During this part of the planning phase, it was Khan - not his friend - who was in touch with Zuhbi. On Feb. 24, 2014, Khan and his friend met in Istanbul, Turkey. At that time, Khan gave his South Texas friend money, knowing he intended to travel to Syria and join and fight with ISIS.

Khan then departed from the Istanbul Airport in Turkey and returned to the United States after his family tricked him into coming home to Houston because of an alleged hospitalization of his mother.

As soon as Khan returned to the United States, he contacted Zuhbi with the purpose of introducing him to his friend so he could enter Syria and join ISIS as a fighter with Zuhbi’s help. Khan then provided to his friend a Turkish cell phone number for reaching Zuhbi. The following day, Khan’s friend sent an electronic message to Khan indicating he had “been delivered :),” by Zuhbi, but that he was not with ISIS yet. Over the next few months, the friend attended fighter training camps and stayed in touch with Zuhbi and Khan. During that time, Khan offered his friend money and instructed him to try to get to ISIS

On Aug. 11, 2014, the friend finally made it to ISIS with Khan and Zuhbi’s assistance. After September 2014, he had ceased all forms of communications. On Dec. 25, 2014, the friend’s mother received an electronic message explaining that her son had died while fighting.

Australian authorities are prosecuting Zuhbi where he is currently being detained.  

Khan has been and will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.

The FBI’s Joint Terrorism Task Force conducted the investigation. Assistant U.S. Attorneys (AUSA) Carolyn Ferko and Alamdar Hamdani prosecuted the case with assistance of Trial Attorney Rebecca Magnone of NSD’s Counterterrorism Section. NSD Appellate Attorney Danielle Tarin and AUSA Anna Kalluri handled the appeal.

McALLEN, Texas – A 34-year-old south Texan has admitted he spoke to people who were interested in buying images of child pornography, announced Acting U.S. Attorney Jennifer B. Lowery.

Astro Rey De Leon admitted to possessing child pornography with the intent to sell it on the internet.

Authorities had learned a computer was receiving child pornography. They were able to trace it to De Leon at his residence. He admitted he was actively involved in speaking with individuals who were interested in buying child pornography via applications on his cell phone.

Authorities conducted a search of his phone and discovered he had tried to sell child pornography as recently as a month prior to their arrival at his residence.  

U.S. District Judge Crane accepted the plea and set sentencing for March 1, 2022. At that time, De Leon faces a minimum of five and up to 20 years in federal prison as well as a possible $250,000 maximum fine.

De Leon has been and will remain in custody pending that hearing.

Homeland Security Investigations - Rio Grande Valley Child Exploitation Task Force conducted the investigation.

Assistant U.S. Attorney Eliza Carmen Rodriguez is prosecuting the case, which was brought as part of Project Safe Childhood (PSC), a nationwide initiative the Department of Justice (DOJ) launched in May 2006 to combat the growing epidemic of child sexual exploitation and abuse. U.S. Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section leads PSC, which marshals federal, state and local resources to locate, apprehend and prosecute individuals who sexually exploit children and identifies and rescues victims. For more information about PSC, please visit DOJ’s PSC page. For more information about internet safety education, please visit the resources link on that page.

McALLEN, Texas – A Border Patrol (BP) agent has pleaded guilty to attempting to aid and abet smuggling cocaine through a BP checkpoint, announced Acting U.S. Attorney Jennifer B. Lowery.

Oberlin Cortez Pena Jr., 22, La Joya, pleaded guilty today.

As part of his plea, Pena admitted that on two separate occasions, he helped smuggle over five kilograms of cocaine through the Falfurrias checkpoint. Specifically, he used his knowledge as a BP agent and directed loads through particular checkpoint lanes, further acting as a scout and providing information about the inspection lanes and which one to use. Pena also gave detailed instructions on how to conceal the drugs and tactics to employ in order to distract the canine unit at the checkpoint.

U.S. District Judge Randy Crane accepted the plea and set sentencing for March 1, 2022. At that time, Pena faces a minimum of 10 years and up to life in federal prison as well as a possible $10 million maximum fine.  

Four others individuals have been convicted as part of the investigation. Edwin Alejandro Castillo, 23, Sullivan City; Kristian Nicole West, 32; Corpus Christi, and Jose Luis Duran, 25, and Herbey Jose Solis III, 28, both of Mission, all pleaded guilty to alien smuggling. Castillo also admitted to bribery, while Duran entered an additional plea to conspiracy to commit bribery.

Pena was permitted to remain on bond pending sentencing.

The Department of Homeland Security - Office of Inspector General conducted the investigation with assistance from Customs and Border Protection - Office of Professional Responsibility and BP. Assistant U.S. Attorneys Jongwoo Chung and John Pearson are prosecuting the case.

HOUSTON – The former chief operating officer of the Houston Independent School District (HISD) has been indicted along with another individual, announced Acting U.S. Attorney Jennifer B. Lowery. Several other former HISD officials have also admitted their guilt in the same corruption case.

Law enforcement took former chief operating officer Brian Busby, 43, and HISD contract vendor Anthony Hutchison, 60, both of Houston, into custody today. They are expected to make their initial appearances before U.S. Magistrate Judge Andrew Edison at 2 p.m.

“This investigation and resulting indictments reflect my office’s commitment to rooting out public corruption in the Southern District of Texas,” said Lowery. “We will not stand idly by when there are people in positions of trust who are suspected of such wrongdoing. We will consider any matter our law enforcement partners bring us involving suspected fraud, waste and abuse of power by those in whom we have placed our faith and confidence and work to hold them accountable.”

A federal grand jury returned the indictment Dec. 14, which was unsealed today. Previously filed was a plea agreement former HISD Board of Education president Rhonda Skillern-Jones, 39, Houston, had entered as well as plea agreements by other former HISD officials. Those officials included Derrick Sanders, 50, Missouri City, officer of construction services; Alfred Hoskins, 58, Missouri City, general manager of facilities, maintenance and operations; Gerron Hall, 47, Missouri City, area manager for maintenance (south); and Luis Tovar, 39, Huffman, area manager for maintenance (north).

“Today's arrests and related charges are the result of a lengthy, multifaceted FBI Houston investigation,” said Acting Special Agent in Charge Richard A. Collodi.” Houston taxpayers and the thousands of HISD students, along with their teachers and staff, are the potential victims of this alleged multimillion-dollar public corruption scheme. The FBI will continue to work to hold accountable public officials who fail the citizens of their community by accepting bribes, and those who pay bribes.”

“The indictment of these two individuals alleges the misuse of their positions of trust within our education system,” said Assistant Special Agent in Charge Ramsey E. Covington of IRS-Criminal Investigation (CI). “IRS-CI special agents are committed to protecting the integrity of our system of taxation by investigating individuals who violate the tax laws and related financial crimes.”

The 26-count indictment charges Busby and Hutchison with conspiring to engage in a bribery scheme. Busby allegedly helped award HISD construction and grounds maintenance contracts to Hutchison in return for cash bribes and hundreds of thousands of dollars in home remodeling.

According to the indictment, Hoskins, Sanders, Hall, Tovar and Skillern-Jones conspired with Busby and Hutchison to accept bribes from Hutchison for helping to award, or not interfering in the award of, HISD contracts to Hutchison.

Operating as Southwest Wholesale, Hutchison allegedly entered long-term contracts with HISD to provide grounds maintenance to schools. The indictment alleges that from 2011 to 2020, Hutchison systematically overbilled HISD and inflated bills for services, causing millions of dollars in loss to the school district. Hutchison paid a portion of his fraudulently boosted profits to Busby in the form of cash payments and free home remodeling, according to the charges.  

According to the indictment, Hutchison also obtained purchase orders for construction, repair, landscaping and maintenance jobs at particular HISD schools. Hutchison obtained these jobs by paying cash bribes, mostly in the form of kickbacks, to HISD personnel who assisted him in obtaining business with HISD, according to the charges. Those allegedly included Busby, Sanders, Hoskins, Hall, Tovar and Skillern-Jones. 

According to the indictment, once Busby and Hutchison learned of the federal criminal probe, they took steps to interfere in the investigation. 

Sanders, Hoskins, Hall and Tovar have admitted they helped award, or refrained from interfering in the award of, HISD jobs to Hutchison, typically at Busby’s insistence. As part of her plea, Skillern-Jones admitted that, in return for bribe payments from Hutchison, she caused an expenditure of funds for school landscaping and construction projects to be placed on a 2017 HISD Board agenda and voted to approve it. They were eventually awarded to Hutchison. In her plea agreement, she admitted Busby personally delivered thousands of dollars in bribe payments to her from Hutchison. 

During execution of search warrants in 2020 at the homes of Busby and Hutchison, authorities allegedly discovered over $186,000 in cash. The indictment gives notice of the government’s intent to forfeit these sums as proceeds of the charged crimes.

Busby and Hutchison are charged with conspiracy, bribery concerning programs receiving federal funds, and witness tampering. Hutchison is further charged with wire fraud. If convicted, they face up to five, 10 and 20 years, respectively, for the conspiracy, bribery and witness tampering charges. Hutchison also faces up to 20 years for each count of wire fraud. 

Hoskins, Sanders, Hall, Tovar and Skillern-Jones have pleaded guilty to the conspiracy charges. They face up to five years in prison.

All of the charges also carry a $250,000 maximum possible fine.

The FBI and the IRS - Criminal Investigation are conducting the investigation. Assistant U.S. Attorney (AUSA) Robert S. Johnson is prosecuting the case. AUSA Kristine Rollinson is handling forfeiture matters.

Busby and Hutchison are presumed innocent unless convicted through due process of law. 

The FBI requests any information the public may have about this scheme or other public corruption crimes affecting the greater Houston community and surrounding areas. Anyone with such information may report it at HoustonCorruption@FBI.gov or may submit the information anonymously by phone at 1-800-CALL-FBI or online at Tips.FBI.gov.

LAREDO, Texas - A 64-year-old Dallas resident been ordered to federal prison for attempting to export firearms, firearm magazines and thousands of rounds of ammunition to Mexico, announced Acting U.S. Attorney Jennifer B. Lowery.

The jury deliberated for five hours before convicting Jose Rafael Vasquez July 1, following a two-day trial. 

Today, U.S. District Judge Diana Saldana, who presided over the trial and sentencing, ordered Vasquez to serve 63 months in federal prison immediately followed by a three-year term of supervised release. At the hearing, the court heard additional information, including the fact that the firearms bore decorative handles and were quite expensive, which criminal organizations highly prized in Mexico.

In handing down the sentence, Judge Saldana noted Vasquez had also previously purchased a semi-automatic rifle in Garland in 2017 which was later found in Durango, Mexico, after a shootout between Mexican law enforcement and armed criminal groups. Authorities directly traced the rifle to Vasquez as the last known legal purchaser.

On Oct. 15, 2020, Vasquez attempted to exit the United States into Mexico through the Laredo Port of Entry. During initial inspection, law enforcement discovered suspicious bundles zip-tied to the undercarriage of the vehicle. They appeared to contain ammunition.

Further inspection revealed three AK-47 rifles, eight semi-automatic handguns of various calibers, 16 handgun magazines and approximately 4,714 rounds of 7.62 mm ammunition hidden inside his vehicle.

The defense attempted to convince the jury Vasquez did not know about the items inside the vehicle. They did not believe his claims and found him guilty as charged.

Vasquez will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.

Homeland Security Investigations, the Bureau of Alcohol, Tobacco, Firearms and Explosives and Customs and Border Protection conducted the investigation. Assistant U.S. Attorneys Francisco J. Rodriguez and David Fawcett prosecuted the case.

HOUSTON – Two men face several charges after allegedly breaking into a blue mail receptacle at the River Oaks U.S. Post Office in Houston, announced Acting U.S. Attorney Jennifer B. Lowery.

Tarek K. Sonnier, 24, Houston, and Monte Drayton, 35, The Bronx, New York, are charged obstruction of correspondence, theft of mail matter and illegal possession of postal keys. They are expected to appearance before a U.S. magistrate judge in the near future.

Both men were previously charged by criminal complaint and remain in custody.

The charges allege Sonnier and Drayton illegally entering the mailbox in the parking lot of the River Oaks Post Office on West Gray Street in Houston and removed mail.

In the early morning hours of Nov. 18 and Nov. 21, a light-colored Chevrolet Camaro with distinctive damage pulled up to the receptable, according to the charges. Two men allegedly exited the vehicle, used an illegally possessed key and loaded all the mail into the vehicle.  

Again, in the early morning hours of Nov. 23, what authorities believe to be the same Camaro drove up to the same receptable exited the vehicle, according to the charges. The complaint further alleges two men, later identified as Sonnier and Drayton, were opening the mailbox with what was determined to be a stolen key.

Authorities then took the two men into custody. Upon their arrest, law enforcement allegedly recovered four stolen postal keys.

If convicted, Sonnier and Drayton could face up to 10 years in prison as well as a possible $250,000 maximum fine.

U.S. Postal Inspection Service conducted the investigation along with the FBI, Houston Police Department and members from the Texas Anti-Gang Center. Assistant U.S. Attorney Richard D. Hanes is prosecuting the case.

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

HOUSTON – A federal grand jury in Houston has returned a superseding indictment against four additional individuals for fraudulently obtaining and laundering millions of dollars in forgivable Paycheck Protection Program (PPP) loans. The Small Business Administration (SBA) guarantees the loans under the Coronavirus Aid, Relief and Economic Security (CARES) Act.

A total of 15 individuals across two states have now been charged in the conspiracy.

Hamza Abbas, 29, Khalid Abbas, 55, Abdul Fatani, 55, all of Richmond; and Syed Ali, 53, of Sugar Land, are set to make their initial appearances tomorrow before U.S. Magistrate Judge Andrew M. Edison.

According to court documents, Hamza Abbas, Khalid Abbas, Fatani and Ali conspired with others to submit more than 80 false and fraudulent PPP loan applications. They allegedly falsified the number of employees and the average monthly payroll expenses of the applicant businesses. In total, the defendants sought over $35 million in PPP loan funds and obtained approximately $18 million in PPP loan proceeds, according to the charges.

The superseding indictment further alleges they laundered a portion of the fraudulent loan proceeds by writing checks from companies that received PPP loans to fake employees. Those that received checks allegedly included some of the defendants and their relatives. The fake paychecks were then allegedly cashed at Fascare International Inc. dba Almeda Discount Store – a check-cashing company. The superseding indictment alleges that over 1,100 fake paychecks totaling more than $3 million in fraudulent PPP loan proceeds were cashed at Almeda.

Previously charged were Amir Aqeel, 53, and Pardeep Basra, 52, both of Houston; Rifat Bajwa, 53, Richmond; Mayer Misak, 41, Cypress; Mauricio Navia, 42, Katy; Richard Reuth, 58, Spring; and Siddiq Azeemuddin, 42, Naperville, Illinois. Aqeel, Bajwa, Basra, Misak, and Navia are also named defendants in the superseding indictment.

Azeemuddin and Reuth have pleaded guilty for their involvement in the scheme. Four others - Abdul Farahshah, 70, Jesus Acosta Perez, 31, and Bijan Rajabi, 68, all of Houston; and Raheel Malik, 41, of Sugar Land - have pleaded guilty for their involvement in the scheme. Malik pleaded guilty to a one-count information charging him with conspiracy to commit wire fraud and money laundering on Oct. 8. Farahshah, Perez and Rajabi each pleaded guilty to a one-count information charging them with conspiracy to commit wire fraud on Nov. 30.

The defendants in the superseding indictment are all charged with conspiracy to commit wire fraud and wire fraud. Aqeel, Khalid Abbas, Ali and Fatani are also charged with money laundering. Aqeel is also charged with aggravated identity theft and is alleged to have submitted PPP loan applications by stealing the identities of uninvolved parties.

If convicted, the defendants face a maximum penalty of 20 years in prison per count of wire fraud and 10 years for each money laundering conviction. If convicted of aggravated identity theft, Aqeel faces a mandatory minimum sentence of two years in addition to the sentence imposed for the other offenses.

The SBA - Office of Inspector General (OIG), Federal Housing Finance Agency – OIG, Homeland Security Investigations, Federal Deposit Insurance Corporation – OIG and Treasury Inspector General for Tax Administration conducted the investigation.   

Assistant U.S. Attorney (AUSA) Rodolfo Ramirez is prosecuting the case along with Trial Attorneys Louis Manzo and Della Sentilles of the Criminal Division’s Fraud Section. AUSA Kristine Rollinson is handling forfeiture matters.

The Fraud Section leads the Criminal Division’s prosecution of fraud schemes that exploit the PPP. Since the inception of the CARES Act, the Fraud Section has prosecuted over 150 defendants in more than 95 criminal cases and has seized over $75 million in cash proceeds derived from fraudulently obtained PPP funds, as well as numerous real estate properties and luxury items purchased with such proceeds.

On May 17, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.

Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.

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

A federal grand jury in Houston returned a superseding indictment, which was unsealed today, charging four additional individuals for fraudulently obtaining and laundering millions of dollars in forgivable Paycheck Protection Program (PPP) loans guaranteed by the Small Business Administration (SBA) under the Coronavirus Aid, Relief, and Economic Security (CARES) Act. In total, 15 individuals across two states have now been charged in the conspiracy.

According to court documents, Hamza Abbas, 29, Khalid Abbas, 55, Abdul Fatani, 55, all of Richmond, Texas; and Syed Ali, 53, of Sugar Land, Texas, conspired with others to submit more than 80 false and fraudulent PPP loan applications by falsifying the number of employees and the average monthly payroll expenses of the applicant businesses. In total, the defendants sought over $35 million in PPP loan funds and obtained approximately $18 million in PPP loan proceeds.

The superseding indictment further alleges that the defendants laundered a portion of the fraudulent loan proceeds by writing checks from companies that received PPP loans to fake employees. Those that received checks included some of the defendants and their relatives, according to the charges. The fake paychecks were then allegedly cashed at Fascare International Inc. dba Almeda Discount Store – a check-cashing company. The superseding indictment alleges that over 1,100 fake paychecks, totaling more than $3 million in fraudulent PPP loan proceeds were cashed at Almeda.

Amir Aqeel, 53, of Houston, Texas; Siddiq Azeemuddin, 42, of Naperville, Illinois; Rifat Bajwa, 53, of Richmond, Texas; Pardeep Basra, 52, of Houston, Texas; Mayer Misak, 41, of Cypress, Texas; Mauricio Navia, 42, of Katy, Texas; and Richard Reuth, 58, of Spring, Texas, were previously indicted for their involvement in the fraudulent loan scheme. Aqeel, Bajwa, Basra, Misak, and Navia are also named defendants in the superseding indictment.

Azeemuddin and Reuth pleaded guilty for their involvement in the scheme on Oct. 8 and 9, respectively. Four other individuals – Abdul Farahshah, 70, Jesus Acosta Perez, 31, and Bijan Rajabi, 68, all of Houston, Texas; and Raheel Malik, 41, of Sugar Land, Texas – have also pleaded guilty for their involvement in the scheme. Malik pleaded guilty to a one-count information charging him with conspiracy to commit wire fraud and money laundering on Oct. 8. Farahshah, Perez, and Rajabi each pleaded guilty to a one-count information charging them with conspiracy to commit wire fraud on Nov. 30.

The defendants in the superseding indictment are all charged with conspiracy to commit wire fraud and wire fraud. Aqeel, Khalid Abbas, Ali, and Fatani are also charged with money laundering. Aqeel is also charged with aggravated identity theft and is alleged to have submitted PPP loan applications by stealing the identities of uninvolved parties. The defendants are scheduled for their initial court appearance tomorrow before U.S. Magistrate Judge Andrew M. Edison of the U.S. District Court for the Southern District of Texas. If convicted, the defendants face a maximum penalty of 20 years in prison per count of wire fraud, and 10 years in prison per count of money laundering. If convicted of aggravated identity theft, Aqeel faces a mandatory minimum sentence of two years in addition to the sentence imposed for the other offenses. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division; Acting U.S. Attorney Jennifer Lowery for the Southern District of Texas; Inspector General Hannibal “Mike” Ware of the SBA–Office of Inspector General (SBA-OIG); Special Agent in Charge Catherine Huber of the Federal Housing Finance Agency–Office of Inspector General (FHFA-OIG); Special Agent in Charge Mark B. Dawson of Homeland Security Investigations (HSI) Houston; Inspector General Jay N. Lerner of the Federal Deposit Insurance Corporation–Office of Inspector General (FDIC-OIG); and Inspector General J. Russell George of the Treasury Inspector General for Tax Administration (TIGTA) made the announcement.

The SBA-OIG, FHFA-OIG, HSI, FDIC-OIG, and TIGTA are investigating the case. 

Trial Attorneys Louis Manzo and Della Sentilles of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Rodolfo Ramirez of the Southern District of Texas are prosecuting the case. Assistant U.S. Attorney Kristine Rollinson is handling forfeiture matters.

The Fraud Section leads the Criminal Division’s prosecution of fraud schemes that exploit the PPP. Since the inception of the CARES Act, the Fraud Section has prosecuted over 150 defendants in more than 95 criminal cases and has seized over $75 million in cash proceeds derived from fraudulently obtained PPP funds, as well as numerous real estate properties and luxury items purchased with such proceeds. More information can be found at https://www.justice.gov/criminal-fraud/ppp-fraud.

On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.

Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.

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

HOUSTON – Three more people have been indicted and additional charges filed in human trafficking conspiracy involving young runaway girls on what it known as the “Blade,” announced Acting U.S. Attorney Jennifer B. Lowery

Law enforcement arrested Chantel Deshay Collins, 28, Houston, and Asia Monae Hailey aka Momo, 21, Galveston, this morning. They are expected to appear for an initial appearance tomorrow before U.S. Magistrate Andrew Edison. Michael Gonzalez aka Mumbles, 21, Houston, is currently in Harris County jail on other charges and is expected to be transferred to federal court to answer these charges by the end of the week.

Also charged are Clarence Chambers aka Chris aka Crazzi Chris, 29, Javon Opoku aka Glizzy, 20, Damarquis McGee aka Lil Blue, 23, Jerreck Hilliard, aka JMoney, Vanessa Sillabi aka Chocolate, 21, and Andres Portillo aka Andro, 20. They are also expected to appear on the new charges in the superseding indictment Dec. 23 before Judge Edison.

The defendants are charged with trafficking young runaway girls on what it known as the “Blade” or the Bissonnet Track. This is an area near Southwest 59 Freeway and Bissonnet Street in Houston where traffickers commonly place their victims, according to the charges.

In addition to the sex trafficking allegations, the superseding indictment includes new charges against many for kidnapping, sexual exploitation of a child, attempted obstruction of justice and attempted coercion/enticement of a child. 

According to the superseding indictment, the defendants worked to recruit underage teenage girls and forced them to engage in sex acts for money in cars and hotels around the Blade. They allegedly passed around or reassigned victims amongst one another, taught each other “the pimp game” and required the young girls to walk the Blade and sell their bodies. They also kept the proceeds, according to the charges.

The superseding indictment further alleges if any of the girls wanted to switch between pimps, they would have to pay an exit fee or get “beat out” to do so. In one instance, a minor girl had allegedly wandered onto a rival pimp’s territory. The charges allege she was kidnapped and raped as a consequence. 

Some of those charged also required daily quotas each night from their victims, according to the charges. The superseding indictment further alleges if the girls failed to meet their daily quotas, they were severely punished through beatings and humiliation. In some cases, pimps allegedly instructed other females to carry out these beatings as punishment. At other times, some defendants worked with the pimps to help harbor, manage, maintain, transport or collect sex trafficking proceeds from the minor victims, according to the charges.  

If convicted, they all could face up to life in prison. 

The Houston Police Department initiated the investigation and later partnered with Homeland Security Investigations and the Harris County District Attorney’s Office as  part of the Human Trafficking Rescue Alliance (HTRA). Established in 2004, the U.S. Attorney’s office in Houston formed HTRA to combine resources with federal, state and local enforcement agencies and prosecutors, as well as non-governmental service organizations to target human traffickers while providing necessary services to those that the traffickers victimized. Since its inception, HTRA has been recognized as both a national and international model in identifying and assisting victims of human trafficking and prosecuting those engaged in trafficking offenses.

Assistant U.S. Attorneys Richard Bennett and Kate Suh are prosecuting the case.

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

McALLEN, Texas – A 30-year-old Rio Grande City resident has been ordered to federal prison for possessing multiple firearms and hundreds of rounds of ammunition, announced Acting U.S. Attorney Jennifer B. Lowery.

Victor Aleman Jr. had been sentenced for another crime but did not report to prison as ordered. He was then found and charged with being a felon in possession of a firearm. He pleaded guilty Sept. 28.

Today, District Judge Michaela Alvarez sentenced him to serve 40 months in federal prison for the firearms charge to be served consecutively to the previous 18 months on the human transporting conviction. The total 58-month prison term will be immediately followed by three years of supervised release. In handing down the sentence, the court noted the number of firearms involved in the case and how it is especially important that individuals abide by laws that relate to the safety of the public. Judge Alvarez also emphasized how Aleman was on pre-trial release for the human-smuggling case and that possessing the firearms throughout both that time and his post-sentencing release was in violation of the court’s orders and the law.  

In April, Judge Alvarez had sentenced Aleman for transporting aliens within the United States. At sentencing, Judge Alvarez ordered Aleman to voluntarily surrender to the U.S. Marshals Service (USMS), but he failed to do so.

Authorities were able to locate him and took him into custody. At that time, they conducted a search of his residence and recreational vehicle and found two assault rifles, a handgun, more than 200 rounds of ammunition and four high-capacity AR-15 magazines.

Aleman admitted he owned the firearms and placed the handgun in the bedroom drawer because he loved the gun.

He will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.

The Bureau of Alcohol, Tobacco, Firearms and Explosives conducted the investigation with the assistance of the U.S. Marshals Service. Assistant U.S. Attorney Lee A. Fry prosecuted the case.

A Texas man was arrested today for allegedly fraudulently obtaining over $3.3 million in Paycheck Protection Program (PPP) loans guaranteed by the Small Business Administration (SBA) under the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

According to allegations in the indictment, Scott Jackson Davis, 46, of Harris County, fraudulently received over $3.3 million in PPP funds through three fraudulent PPP loan applications submitted to a financial institution. Davis submitted applications for three businesses which he claimed to represent: Skilled Trade Investments LP (STILP), Skilled Trade Staffing LLC (STS), and Skilled Trade Investments Group LLC (STIGP). Davis claimed that these businesses had numerous employees and significant payroll, when in fact, they had few if any employees and little to no payroll. Davis also claimed on the applications that he had not been convicted of a felony in the previous five years, when in fact he had pleaded guilty to felony wire fraud charges in the Southern District of Texas in April 2017. Davis spent a large portion of the PPP loan funds on private jet travel, real estate, and luxury vehicles.

Davis is charged with wire fraud, bank fraud, and money laundering. The defendant is scheduled for his initial court appearance today before U.S. Magistrate Judge Christina A. Bryan of the U.S. District Court for the Southern District of Texas. If convicted, he faces a maximum total penalty of 30 years in prison for each count of bank fraud, 20 years in prison for each count of wire fraud, and 10 years in prison for each count of money laundering. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division; Acting U.S. Attorney Jennifer Lowery for the Southern District of Texas; Inspector General Hannibal “Mike” Ware of the SBA-Office of Inspector General (SBA-OIG); Acting Assistant Director Jay Greenberg of the FBI’s Criminal Investigative Division; and Special Agent-in-Charge Perrye K. Turner of the FBI’s Houston Field Office made the announcement.

The SBA-OIG and FBI’s Houston Field Office are investigating the case.

Trial Attorney Edward E. Emokpae of the Criminal Division’s Fraud Section and Assistant U.S. Attorney John Wakefield of the U.S. Attorney’s Office for the Southern District of Texas are prosecuting the case.

The Fraud Section leads the Criminal Division’s prosecution of fraud schemes that exploit the PPP. Since the inception of the CARES Act, the Fraud Section has prosecuted over 150 defendants in more than 95 criminal cases and has seized over $75 million in cash proceeds derived from fraudulently obtained PPP funds, as well as numerous real estate properties and luxury items purchased with such proceeds. More information can be found at https://www.justice.gov/criminal-fraud/ppp-fraud.

On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.

Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.

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

CORPUS CHRISTI, Texas – A 27-year-old Harlingen man has been ordered to prison for two separate smuggling attempts, announced Acting U.S. Attorney Jennifer B. Lowery.

Eduardo Javier Jimenez pleaded guilty to each respective crime on May 4 and June 22.

Today, U.S. District Judge Drew B. Tipton ordered he serve a total of 85 months in federal prison to be immediately followed by two years of supervised release.

In February, authorities had found Jimenez on the side of the road asking for a ride. They observed his pants being wet and suspected he had been acting as a brush guide. However, at the time, they could not verify their suspicions and released him.

Later, law enforcement apprehended a group of 12 individuals after they had circumvented the Sarita checkpoint. The investigation revealed their guide had abandoned them, leaving them in below freezing temperatures for more than 15 hours. Some in the group claimed their brush guide told them he needed to use the restroom and to go ahead, and he would catch up. However, the guide had left them and disappeared. One person succumbed to hypothermia and died of dehydration.

One week later, Jimenez was found working as a brush guide for another group. At that time, he admitted he had done the same for the other group the week of the hard freeze.

He claimed the group had actually abandoned him. He later admitted this information was not true and eventually pleaded guilty to his role in both smuggling attempts.

Jimenez has been and will remain in custody spending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.

Homeland Security Investigations conducted the investigation with the assistance of Border Patrol. Assistant U.S. Attorney Barbara J. De Pena prosecuted the case.

HOUSTON – All seven defendants charged in relation to a more than $50 million securities fraud “pump-and-dump” scheme have received their final sentences, announced Acting U.S. Attorney Jennifer B. Lowery.

Carolyn Price Austin, 67, Houston, pleaded guilty as did Andrew Ian Farmer, 43, Thomas Galen Massey, 51, Eddie Douglas Austin Jr., 71, and Charles Earl Grob, 41, all also of Houston; John David Brotherton, 62, League City; and Scott Russell Sieck, 62, Winter Park, Florida.

Today, U.S. District Judge Vanessa Gilmore sentenced her to 12 months in federal prison to be immediately followed by one year of supervised release. In handing down the sentence, the court noted the large sum of money lost by the victims in the case and that there were “some people that lost all their money.”

Previously, Judge Gilmore ordered Farmer to serve a sentence of 72 months. Brotherton, Grob and Massey were ordered to serve 60 months, 12 months and three years of probation, respectively, while Eddie Austin and Sieck both were ordered to serve 36-month terms of imprisonment.

All seven must also pay restitution the victims of their scheme. Farmer and Sieck were each ordered to pay $8 million, while Eddie Austin must pay $6.6 million. The court ordered Grob and Massey to pay $4.5 and $1 million, respectively while Brotherton must pay $6.2 million. The court held open the amount of restitution Carolyn Austin will be required to pay to enable the parties to submit an agreed upon amount.

Farmer, Eddie Austin, Sieck, Brotherton and Grob were further ordered to forfeit additional funds to the United States in amounts ranging from $242,907 to $6 million.

The defendants admitted to their involvement in a conspiracy to commit fraud in microcap securities. During the course of the conspiracy, they obtained control of the stock of numerous companies, then “pumped up” the price of the stock through false and misleading press releases and fraudulent trading techniques. They then “dumped” their shares of stock onto the market for a significant profit.

Farmer and Brotherton are in custody serving their sentence at a U.S. Bureau of Prisons facility. Eddie Austin, Carolyn Austin and Sieck were permitted to remain on bond and voluntarily surrender at a later date. Grob has completed his sentence and is currently on supervised release.

The FBI conducted the investigation with the assistance of the Securities and Exchange Commission and Financial Industry Regulatory Authority. Assistant U.S. Attorneys Justin R. Martin and Michael Chu are prosecuting the case.

LAREDO, Texas – Two Mexican men have admitted to their roles in an alien smuggling conspiracy which resulted in death, announced Acting U.S. Attorney Jennifer B. Lowery.

Fabian Hernandez, 29, Nuevo Laredo, Tamaulipas, Mexico, and Emmanuel Ferral-Tonche, 19, Nuevo Laredo, Tamaulipas, Mexico, pleaded guilty before U.S. Magistrate Judge John Kazen today.

On June 9, 2021, Hernandez and Ferral-Tonche marched a group of approximately two dozen individuals through the hot south Texas brush. Some were unable to keep going. At no time did Hernandez or Ferral-Tonche offer water or attempt to look for anyone who had fallen behind or gotten lost.

Authorities eventually responded to multiple 911 emergency calls coming from the Hachar Ranch property in Webb County. They ultimately discovered 24 individuals illegally present in the United States who had become lost at that location. They identified Hernandez and Ferral-Tonche as the smugglers.

Law enforcement also found the remains of three deceased people. Agents determined Hernandez and Ferral-Tonche had guided at least one of them before they succumbed to dehydration and hyperthermia while being smuggled.

U.S. District Judge Marina Garcia Marmolejo will impose sentencing March 16, 2022. At that time, both men face up to life in federal prison. They have been and will remain in custody pending that hearing.

Homeland Security Investigations and Customs and Border Protection conducted the investigation with assistance from the Laredo Police Department.

Assistant U.S. Attorney Francisco J. Rodriguez is prosecuting the case.

HOUSTON – A 35-year-old Houston resident has admitted to four counts of theft of public money, announced Acting U.S. Attorney Jennifer B. Lowery.

Tranese Nicole Mitchel was formerly employed as a lead sales and service clerk with the U.S. Postal Service (USPS) in Houston. Today, she admitted she issued fraudulent refunds by creating no-fee postal money orders She then cashed against her drawer at the post office where she worked.

Mitchell fraudulently issued and cashed a total of $29,947.30. She admitted using the money for her own benefit.

U.S. District Judge Andrew Hanen accepted the plea and set sentencing for April 11. At that time, Mitchell faces up to 10 years imprisonment and a maximum $250,000 fine.

She was permitted to remain on bond pending that hearing.

The U.S. Postal Service - Office of Inspector General conducted the investigation. Assistant U.S. Attorney John Braddock is prosecuting the case.

A federal grand jury in Houston returned an indictment on Dec. 7 charging a natural gas trader for an insider trading scheme involving natural gas futures.

According to court documents, Peter Miller, 41, of Puerto Rico, worked as a natural gas trader for his own company, Omerta Capital LLC. Miller conspired with others to misappropriate material, nonpublic information and to engage in fraudulent, noncompetitive trades, including prearranged trades, in natural gas futures contracts for their own personal gain. Miller and his co-conspirators caused prices to be reported, recorded, and registered on designated commodities markets that were not true, bona fide prices. The profits from these fraudulent trades were split among Miller and his co-conspirators.

In four related cases, Marcus Schultz, 41, of Houston, Texas; John Ed James, 51, of Katy, Texas; Mathew Webb, 51, of Tiki Island, Texas; and Lee Tippett, 62, of Jacksonville, Florida, pleaded guilty on July 20, 2020, Feb. 1, 2021, June 15, 2021, and Aug. 17, 2021, respectively. Schultz pleaded guilty to a one-count information charging him with conspiracy to commit wire fraud and to violate various provisions of the Commodity Exchange Act. James pleaded guilty to a one-count information charging him with conspiracy to commit commodities fraud and wire fraud. Webb pleaded guilty to a one-count information charging him with conspiracy to commit commodities fraud and wire fraud and to violate various provisions of the Commodity Exchange Act. Tippett pleaded guilty to a one-count information charging him with conspiracy to commit commodities fraud and honest services wire fraud.

Miller is charged with one count of conspiracy to commit commodities fraud and four counts of commodities fraud. The defendant is scheduled for his initial court appearance on Dec. 16 before U.S. Magistrate Judge Christina A. Bryan of the U.S. District Court for the Southern District of Texas. If convicted, he faces a maximum total penalty of 25 years in prison per count. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division; Acting U. S. Attorney Jennifer Lowery for the Southern District of Texas; Acting Assistant Director Jay Greenberg of the FBI's Criminal Investigative Division; Acting Special Agent in Charge Richard A. Collodi of the FBI’s Houston Field Office; and Special Agent in Charge Richard Gross of the IRS-Criminal Investigation’s Houston Field Office made the announcement.

The FBI’s Houston Field Office and IRS-Criminal Investigation’s Houston Field Office are investigating the case.

Trial Attorneys Leslie S. Garthwaite and Della Sentilles of the Criminal Division’s Fraud Section and Deputy Chief Suzanne Elmilady and Assistant U.S. Attorney Zahra Fenelon of the U.S. Attorney’s Office for the Southern District of Texas are prosecuting the case.

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

LAREDO, Texas – A 26-year-old Laredo resident is set to appear in federal court on charges of possessing and distributing child pornography, announced Acting U.S. Attorney Jennifer B. Lowery.

A federal grand jury returned a three-count indictment against Kevin Montemayor Oct. 19.

The indictment was unsealed Dec. 7 upon his arrest. He is set to make his initial appearance before U.S. Magistrate Judge Diana Song Quiroga at 1:30 p.m.   

According to the charges, a person linked to an IP address in Laredo had uploaded child pornography to Facebook messenger. Law enforcement conducted a search at the residence and allegedly encountered Montemayor.

A forensic analysis of Montemayor’s seized electronic devices included more than 7,000 images and videos of child pornography, according to the charges. The images allegedly included children as young as 3.

If convicted, Montemayor faces a minimum of five and up to 20 years in federal prison.

Homeland Security Investigations conducted the investigation.

Assistant U.S. Attorney Aaron Petters is prosecuting the case, which was brought as part of Project Safe Childhood (PSC), a nationwide initiative the Department of Justice (DOJ) launched in May 2006 to combat the growing epidemic of child sexual exploitation and abuse. U.S. Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section leads PSC, which marshals federal, state and local resources to locate, apprehend and prosecute individuals who sexually exploit children and identifies and rescues victims. For more information about PSC, please visit DOJ’s PSC page. For more information about internet safety education, please visit the resources link on that page.

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

CORPUS CHRISTI, Texas – A 35-year-old Corpus Christi resident has been ordered to federal prison for using social media to entice a young girl to engage in sexual activity, announced Acting U.S. Attorney Jennifer B. Lowery.

Robert Velasquez pleaded guilty in January 2020.  

Today, Senior U.S. District Judge Janis Graham Jack ordered he serve the rest of life in prison. At the hearing, the court heard additional information including impact statements from three of his victims. Additional information was also presented about the identification of several victims between the ages eight and 15. In handing down the prison term, the court noted that given the nature of the defendant’s conduct and the damage he had done to the victims and their families, she felt she had no other sentence available to her that could properly protect the community. A restitution hearing will be held at a later date.

“Using any type of social media to target our children is deplorable,” said Acting U.S. Attorney Jennifer B. Lowery. “Such communication avenues can be wonderful tools to share stories and connect with people, but we must remain vigilant and cautious. This defendant abused these systems and hunted for victims who were specifically underage and local. Thankfully, he will be behind bars, but the case is a good reminder to monitor our children’s activity and to be careful about having identifiable information readily available.”

The investigation began in January 2019. Authorities ultimately reviewed more than 50,000 social media chats which led to the identification of over 10 young girls ranging from 8 to 17 years of age whom Velasquez victimized.

He had used the victims’ social media accounts to determine they were local and underage. He then targeted them with complimentary messages and long conversations in order to get the girls to meet for sex. In some instances, he photographed the children during their physical encounters.

Velasquez has been and will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.

The FBI and the Corpus Christi Police Department Internet Crimes Against Children conducted the investigation.

Assistant U.S. Attorney Brittany L. Jensen is prosecuting the case, which was brought as part of Project Safe Childhood (PSC), a nationwide initiative the Department of Justice (DOJ) launched in May 2006 to combat the growing epidemic of child sexual exploitation and abuse. U.S. Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section leads PSC, which marshals federal, state and local resources to locate, apprehend and prosecute individuals who sexually exploit children and identifies and rescues victims. For more information about PSC, please visit DOJ’s PSC page. For more information about internet safety education, please visit the resources tab on that page.

BROWNSVILLE, Texas – A 38-year-old resident of Matamoros, Tamaulipas, Mexico, has been ordered to federal prison for producing child pornography, announced Acting U.S. Attorney Jennifer B. Lowery.

Jose Alfredo Fernandez-Martinez pleaded guilty Aug. 4.

Today, U.S. District Judge Rolando Olvera Jr. ordered him to serve a 360-month sentence. At the hearing, the court heard additional information including the victim impact statement from the victim’s mother. Following the sentence, Fernandez-Martinez will serve 10 years on supervised release, during which time he will have to comply with numerous requirements designed to restrict his access to children and the internet. Fernandez-Martinez will also be ordered to register as a sex offender and must pay a total of $55,000 in special assessments.

From on our about Aug. 2, 2020, to Jan. 6, 2021, Fernandez-Martinez caused an eight-year-old female to engage in sexually-explicit conduct. He recorded it with his cellphone.

Fernandez-Martinez attempted to enter the country, at which time authorities found the videos. A forensic examination of the phone determined he possessed approximately 141 videos and 82 images of child pornography. Fernandez-Martinez created five of the videos with the phone.

Fernandez-Martinez has been and will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.

Homeland Security Investigations - Rio Grande Valley Child Exploitation Task Force conducted the investigation.

Assistant U.S. Attorney Ana C. Cano prosecuted the case, which was brought as part of Project Safe Childhood (PSC), a nationwide initiative the Department of Justice (DOJ) launched in May 2006 to combat the growing epidemic of child sexual exploitation and abuse. U.S. Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section leads PSC, which marshals federal, state and local resources to locate, apprehend and prosecute individuals who sexually exploit children and identifies and rescues victims. For more information about PSC, please visit DOJ’s PSC page. For more information about internet safety education, please visit the resources tab on that page.

HOUSTON – A 45-year-old rural Houston resident has admitted he murdered a U.S. Postal Service (USPS) mail carrier while she was in the performance of her official duties, announced Acting U.S. Attorney Jennifer B. Lowery.

James Wayne Ham pleaded guilty today. Immediately thereafter, U.S. District Judge Lynn N. Hughes handed down a life sentence.

“Any murder against our citizens is egregious and intolerable,” said Lowery. “Even worse is someone who attacks our workforce while they are simply doing their job. This plea and sentence shows our determination to stand firm with our partners to ensure no one escapes justice for such vicious crimes.”

At the hearing, Ham admitted he murdered a USPS employee May 17, 2013, by shooting her with a firearm and then setting her on fire.

“USPS letter carriers are in our neighborhoods every day, delivering mail to homes and businesses across this country,” said Acting Inspector in Charge Dana Carter of the U.S. Postal Inspection Service (USPIS). “The investigation and arrest of Ham for his shocking and heinous crimes against a USPS letter carrier was the highest priority for the USPIS. Our thoughts continue to be with the victim’s family and all affected by this senseless crime.”

On May 17, 2013, Ham obtained a rifle, lighter fluid and extra ammunition. He then hid in the tree line near his home. Once the mail carrier delivered his mail and began leaving the area, Ham shot her approximately four times. He soon got into her vehicle and drove a short distance away to a water supply station. There, he doused the vehicle with lighter fluid and set it on fire. The victim’s body was still inside.

The victim’s son alerted law enforcement to the murder. He had been on the phone with the victim when Ham shot her. He advised that he had heard two loud noises, and upon questioning, she stated she thought she had been shot.

The son also heard an unintelligible male's voice over the telephone. During the call, he heard his mother say “Please don't kill me, please don't kill me.” The call was disconnected, after which he called 911.

Authorities later found Ham hiding in a vacant residence near the scene of the murder. They arrested him where he ultimately confessed. After the interview, Ham took law enforcement to the scene of the murder and showed them where he had hidden the gun as well as the location where he had shot the victim.

Ham has been and will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.

USPIS conducted the investigation. Assistant U.S. Attorneys Jill Stotts and Erin Epley prosecuted the case along with Trial Attorney Barry Disney of the Justice Department's Capital Case Section.

LAREDO, Texas – A 20-year-old Dallas resident has entered a guilty plea to illegally importing approximately 25.16 kilograms of meth, announced Acting U.S. Attorney Jennifer B. Lowery.

On June 6, Luke Law attempted to cross into the United States after vacationing in Monterrey, Mexico. Authorities referred his vehicle to the secondary inspection area where a K-9 alerted to the presence of narcotics. An X-ray scan revealed anomalies behind the vehicle’s gas tank. Upon further investigation, law enforcement discovered a total of 29 bundles of meth wrapped in clear tape weighing approximately 25.16 kilograms.

The drugs have an estimated street value of approximately $1.1 million.

U.S. District Judge Marina Garcia Marmolejo accepted the plea and set sentencing for a future date. At that time, Law faces up to life in prison and a possible $10 million maximum fine. He will remain in custody pending that hearing. 

Homeland Security Investigations and Customs and Border Protection conducted the investigation. Assistant U.S. Attorney Michael Makens is prosecuting the case.

McALLEN, Texas – A former McAllen youth league coach who illegally resided in Pharr has entered a guilty plea to sexual exploitation of children, announced Acting U.S. Attorney Jennifer B. Lowery.

From March 2020 through June 2021, Oscar Hinojosa communicated and cultivated a relationship with a 15-year-old minor.

Hinojosa was the victim’s soccer coach. Over time, Hinojosa told her he loved her and expressed his sexual desire for her. During their communications, Hinojosa instructed the minor victim to send a sexually-explicit photo of her genitalia in a specific pose. She ultimately did as requested on this occasion and others.

While communicating with this victim, Hinojosa also attempted to cultivate a similar relationship to another one of the minor females on his soccer team. While he was unsuccessful, he expressed his love for her as well.

Hinojosa is not a citizen of the United States does not have legal status to reside here.  

Mission Police Department and Homeland Security Investigations conducted the investigation.

U.S. District Judge Alvarez accepted the plea and set sentencing for March 18, 2022. At that time, Hinojosa faces up to 30 years in federal prison.

He has been and will remain in custody pending that hearing.

Assistant U.S. Attorney Colton T. Turner is prosecuting the case, which was brought as part of Project Safe Childhood (PSC), a nationwide initiative the Department of Justice (DOJ) launched in May 2006 to combat the growing epidemic of child sexual exploitation and abuse. U.S. Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section leads PSC, which marshals federal, state and local resources to locate, apprehend and prosecute individuals who sexually exploit children and identifies and rescues victims. For more information about PSC, please visit DOJ’s PSC page. For more information about internet safety education, please visit the resources tab on that page.

HOUSTON – A 65-year-old Missouri City man has been ordered to federal prison for conspiracy to commit mail fraud, announced Acting U.S. Attorney Jennifer B. Lowery.

Richard Rose pleaded guilty Aug. 17.

Today, Chief U.S. District Judge Lee H. Rosenthal imposed a 36-month prison sentence and further ordered Rose to pay restitution of $335,439.

Rose was the founder of Zoe Learning Academy. He served in various capacities to include superintendent, CEO and chief financial officer during its operations from 2001 until it closed in September 2019. 

At the time of his plea, he admitted he filed falsified governance reports through the U.S. mail to obtain charter school funds. He embezzled funds intended for the charter school’s operation and used them for his personal expenses such as legal fees, a lawsuit settlement and for the purchase of a timeshare.

Rose was permitted to remain on bond and voluntarily surrender to a Bureau of Prisons facility to be determined in the near future.

IRS-Criminal Investigation, Secret Service, Department of Education-Office of Inspector General and the FBI conducted the investigation. Assistant U.S. Attorney Belinda Beek and Quincy Ollison prosecuted the case.

HOUSTON - A 47-year-old medical sales representative has agreed to pay $100,000 to settle allegations that he assisted in causing the submission of false claims, announced Acting U.S. Attorney Jennifer B. Lowery.  

Matthew Thibaut is a sales representative from Cypress. He sold products through his business, Flex Surgical Management LLC. 

From Jan. 1, 2017, to Dec. 31, 2019, Thibaut sold ANSiStim and Primary Relief devices to various medical providers. DyAnsys Inc. manufactures the devices which are used for electro-acupuncture. This only involves inserting needles into patients’ ears with the neurostimulator taped behind them with an adhesive. 

However, Thibaut’s customers falsely billed Medicare for the surgical implantation of neurostimulator electrodes. These are invasive procedures usually requiring use of an operating room for which Medicare pays thousands of dollars. Thibaut allegedly knew his customers would bill Medicare in this fashion and, therefore, assisted in causing the submission of false claims, according to the allegations.     

To date, the Southern District of Texas has resolved six other similar cases which included settlements from a Katy anesthesiologist, a Houston pain doctor, a Rockport chiropractor, a Houston chiropractor, a Laredo pain doctor and a Woodlands pain doctor. This is the first settlement in the Southern District of Texas involving a device marketer.    

The U.S. Attorney’s Office jointly conducted the investigation with the Department of Health and Human Services – Office of Inspector General. Assistant U.S. Attorney Brad Gray handled the matter.

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

HOUSTON – A 30-year-old man has been ordered to federal prison on multiple counts involving child pornography, announced Acting U.S. Attorney Jennifer B. Lowery.

Andrew Blake Delacruz pleaded guilty May 6 to three counts of sexual exploitation of children as well as possession and distribution of child pornography.  

Today, U.S. District Judge Alfred Bennett ordered him to serve a total of 720 months in federal prison. At the hearing, the court heard victim statements explaining how Delacruz detrimentally impacted their lives and were seeking justice.

In handing down the sentence, Judge Bennett noted Delacruz’s egregious conduct in his victimization of three minors, one of whom had a mild mental disability. 

Delacruz came to the attention of law enforcement after he sent images of child pornography of a minor female relative through an online chat group which was dedicated to the sexual exploitation of children. 

On July 17, 2020, authorities executed a search warrant at his residence and seized his cellphones. At that time, they located a young female victim who reported that Delacruz had been sexually abusing her and would take pictures.

A forensic examination resulted in the discovery of seven videos and 41 images of that victim which showed oral and anal penetration. Law enforcement also found two other young victims of whom Delacruz had also produced child pornography.

One of those victims was only nine years of age at the time of the abuse. She reported that Delacruz would rub her thighs, buttocks and vaginal area and that he would perform oral sex on her. She also described how he would rub his penis on her vagina and attempted to vaginally penetrate her. 

In addition, there were six images of child pornography of one of her friends. Delacruz has his penis exposed in the foreground of some of the images. In others, Delacruz’s hand is seen pulling down her pants and underwear, exposing her buttocks. 

In addition to the child pornography Delacruz created of these minor victims, authorities also found 50 videos and seven images of other child pornography Delacruz had in his collection. 

Delacruz has been and will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.

The FBI conducted the investigation.

Assistant U.S. Attorneys Kimberly Ann Leo and Luis Batarse prosecuted the case, which was brought as part of Project Safe Childhood (PSC), a nationwide initiative the Department of Justice (DOJ) launched in May 2006 to combat the growing epidemic of child sexual exploitation and abuse. U.S. Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section leads PSC, which marshals federal, state and local resources to locate, apprehend and prosecute individuals who sexually exploit children and identifies and rescues victims. For more information about PSC, please visit DOJ’s PSC page. For more information about internet safety education, please visit the resources tab on that page.

A Texas man was sentenced today to 110 months in prison for his scheme to fraudulently obtain and launder proceeds from more than $1.6 million in Paycheck Protection Program (PPP) loans guaranteed by the Small Business Administration (SBA) under the Coronavirus Aid, Relief and Economic Security (CARES) Act.

According to court documents, Lee Price III, 30, of Houston, who pleaded guilty in September to charges of wire fraud and money laundering, submitted fraudulent PPP loan applications to two different lenders on behalf of three entities, 713 Construction LLC, Price Enterprises Holdings LLC, and Price Logistic Services LLC. Through these loan applications, Price sought over $2.6 million and actually obtained over $1.6 million in PPP loan funds. Price falsely represented the number of employees and payroll expenses in each of the PPP loan applications. To support the fraudulent PPP loan applications, Price also submitted fraudulent tax records and other materials. Illustratively, with respect to the 713 Construction LLC loan application, Price applied in the name of an individual who died shortly before the application was submitted. After he received the PPP loan funds, Price spent the money on, among other purchases, a Lamborghini Urus, a Ford F-350 truck, a Rolex watch, and to pay off a loan on a residential property. The Department of Justice, along with law enforcement partners, seized over $700,000 of the funds Price fraudulently obtained.

Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division; Acting U.S. Attorney Jennifer Lowery for the Southern District of Texas; Special Agent in Charge Catherine Huber of the Federal Housing Finance Agency Office of Inspector General (FHFA-OIG) – Central Region; Special Agent in Charge Sharon Johnson of the SBA Office of Inspector General (SBA-OIG) – Central Region; and Acting Inspector in Charge Dana Carter of the U.S. Postal Inspection Service – Houston Division made the announcement.

FHFA-OIG, SBA-OIG, and the U.S. Postal Inspection Service investigated the case.

Trial Attorney Andrew Tyler of the Criminal Division’s Fraud Section and Trial Attorneys James Alexander and Matthew Grisier of the Criminal Division’s Money Laundering and Asset Recovery Section are prosecuting the case with the assistance of Assistant U.S. Attorney James McAlister of the Southern District of Texas. Assistant Deputy Chief Timothy A. Duree and Trial Attorney Kyle Maurer of the Criminal Division’s Fraud Section assisted in the investigation and prosecution of the case. 

The Fraud Section leads the Criminal Division’s prosecution of fraud schemes that exploit the PPP. Since the inception of the CARES Act, the Fraud Section has prosecuted over 150 defendants in more than 95 criminal cases and has seized over $75 million in cash proceeds derived from fraudulently obtained PPP funds, as well as numerous real estate properties and luxury items purchased with such proceeds. More information can be found at https://www.justice.gov/criminal-fraud/ppp-fraud.

On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.

Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.

HOUSTON – A 62-year-old Houston resident is set to appear in federal court on charges she defrauded a property management company, announced Acting U.S. Attorney Jennifer B. Lowery.

Maria Denise Southall-Shaw is charged with one count of wire fraud. She is set to appear before U.S. Magistrate Judge Andrew Ellison at 2 p.m. today.

Southall-Shaw was the former manager of Shadow Creek Ranch in Pearland. First Service Residential (FSR) is Shadow Creek’s property management company and employed Southall-Shaw, according to the information.

She allegedly engaged in a scheme to defraud FSR. The information alleges that between December 2013 and November 2017, Southall-Shaw approved invoices from a ranch vendor for goods and services she knew the vendor had not provided, according to the allegations.

Southall-Shaw allegedly caused this vendor to kickback to her 50% of the payment the vendor received, which totaled $421,519.

If convicted, she faces up to 20 years in federal as well as a possible $250,000 maximum fine.  

The FBI conducted the investigation. Assistant U.S. Attorney John Braddock is prosecuting the case.

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

CORPUS CHRISTI, Texas – A federal jury sitting in Corpus Christi has found a 59-year-old local man guilty of conspiracy to distribute more than five grams of meth and possession with intent to distribute 27 grams of meth, announced Acting U.S. Attorney Jennifer B. Lowery.

The jury deliberated for approximately three hours following a two-day trial before returning a guilty verdict on both counts against Ronald Flirt.

On Nov. 17, 2020, authorities were surveilling a known drug stash house when they witnessed Flirt stop at the location. A Drug Enforcement Administration (DEA) agent testified at trial, describing how someone had exited Flirt’s vehicle, entered the stash house and returned to the truck.

Law enforcement then pulled Flirt over and found he had a total of 10 Ziplock bags of meth. They had a total street value of more than $4,000.

Further testimony revealed he tried to deceive authorities when the initially stopped him. However, jurors saw bodycam video in which law enforcement asked Flirt to show him his hands which demonstrated he had one finger missing as he attempted to hide a bag of meth.

The jury also heard that Flirt had a Santa Muerte statue to protect him from law enforcement. It clearly did not work.

The defense attempted to convince the jury the drugs were solely for personal use and that Flirt intended to smoke an entire ounce of meth. They did not believe those calins and found him guilty as charged.

U.S. District Judge David Morales set sentencing for Feb. 23, 2022. At that time, Flirt faces up to 40 years in prison and a possible $5 million maximum fine. He has been and will remain in custody pending that hearing. 

The DEA and police departments in Corpus Christi and Mathis conducted the investigation. Assistant U.S. Attorneys Christopher Marin and John Marck are prosecuting the case.

HOUSTON – A 24-year-old Houston man has been ordered to federal prison following his convictions on robbery, brandishing and discharging a firearm during a crime of violence, announced Acting U.S. Attorney Jennifer Lowery.

Dametric Marquise Hunter pleaded guilty Aug. 31.

Today, U.S. District Judge Vanessa Gilmore ordered him to serve a total of 234 months in federal prison. The sentence will be immediately followed by five years of supervised release.

Co-defendant Joshua Dawayne Prater, 23, Houston, pleaded guilty to one count each of robbery and discharging a firearm during a crime of violence. He received a total sentence of 132 months Nov. 15.

In January and February of 2019, Hunter, Prater and others committed a series of commercial armed robberies, including several that took place at Walgreens stores.

On Feb. 12, 2019, a joint task force operation resulted in the surveillance and arrest of Hunter and Prater as they fled a robbery at a Walgreens on Westheimer Parkway in Fort Bend County. A shoot-out ensured and two others believed to be involved in the robbery were killed.

The investigation led to the discovery that Hunter and Prater also committed to multiple robberies in 2019.

Both men have been and will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.

The FBI and Texas Department of Public Safety conducted the investigation.  Assistant U.S. Attorneys John Michael Lewis and Matthew Roy Peneguy are prosecuting the case.

McALLEN, Texas – A 27-year-old McAllen resident has been ordered to federal prison after admitting he intended to engage in sexual activity with a minor female, announced Acting U.S. Attorney Jennifer B. Lowery.

David Montelongo pleaded guilty June 24.

Today, U.S. District Judge Randy Crane sentenced him to 120 months in federal prison. In handing down the sentence, the court noted that Montelongo had committed a very serious offense which was not impulsive as it had taken place over some length of time. Judge Crane also referenced how Montelongo knew his conduct was wrong. Montelongo was further ordered to serve five years on supervised release following completion of his prison term, during which time he will have to comply with numerous requirements designed to restrict his access to children. He will also be required to register as a sex offender.

On Jan. 21, Montelongo began to entice and coerce an individual he believed to be a 13-year-old female on a popular social media application. In their communications, Montelongo discussed the sexual acts he desired to perform on the minor and take her virginity.

Montelongo requested to meet the alleged minor in person at a park in McAllen, at which time he expected to engage in sexual activity with her. Montelongo saw authorities and fled upon arrival. Law enforcement later took him into custody March 10.

He has been and will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.

Homeland Security Investigations - Rio Grande Valley Child Exploitation Investigations Task Force conducted the investigation.

Assistant U.S. Attorney Michael Mitchell prosecuted the case, which was brought as part of Project Safe Childhood (PSC), a nationwide initiative the Department of Justice (DOJ) launched in May 2006 to combat the growing epidemic of child sexual exploitation and abuse. U.S. Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section leads PSC, which marshals federal, state and local resources to locate, apprehend and prosecute individuals who sexually exploit children and identifies and rescues victims. For more information about PSC, please visit DOJ’s PSC page. For more information about internet safety education, please visit the resources tab on that page.

HOUSTON – Two ophthalmologists and their eye clinic must pay millions of dollars for fraudulently billing Medicare in relation to the evaluation and treatment of glaucoma, announced Acting U.S. Attorney Jennifer B. Lowery.

“Deliberately overcharging the government for medical services wastes our country’s precious health care resources,” said Lowery. “We will not stand idly by as providers in our district attempt to abuse the system.”  

U.S. District Judge Lynn N. Hughes assessed the amounts against Dr. Mustapha Kibirige, 58, and Dr. Emelike Agomo, 57, and the eye clinic they operated in Houston – Outreach Diagnostic Clinic LLP. Kibirige also practices in Humble.

The action is a result of a whistleblower lawsuit a former employee of Outreach had filed under the False Claims Act (FCA). It alleged the two ophthalmologists were fraudulently billing the Medicare Program for single eye pressure measurement tests used to assess and treat glaucoma. Kibirige and Agomo allegedly billed the federal health care program using an improper reimbursement code that provided a higher reimbursement than what was allowed.

Under the FCA, the government is entitled to treble damages and a penalty on each false claim. Judge Hughes determined those damages amounted to $2,422,350. The court further found the practice had submitted 14,450 false claims to the Medicare Program between 2006 and 2012. Judge Hughes assessed a penalty of $11,803 for each of those false claims, resulting in a total of $170,553,350 in penalties.

Under the FCA, a private party can file an action on behalf of the United States and receive a share of the recovery.

The Department of Health and Human Services - Office of Inspector General conducted the investigation. Deputy Civil Chief Andrew A. Bobb and former Assistant U.S. Attorney Jose Vela handled that matter.

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