Southern District of Texas

HOUSTON ‐ A Houston area resident has entered a guilty plea to fraud in connection with a major disaster for her scheme to defraud the Federal Emergency Management Agency (FEMA), announced U.S. Attorney Ryan K. Patrick. 

Patricia Rodriguez, 38, of Houston, entered her guilty plea today before U.S. District Judge Vanessa Gilmore.

As part of that plea, Rodriguez admitted she submitted a false or fraudulent application to FEMA for government assistance in reference to property damage sustained in Hurricane Harvey. The property was located in Houston but which investigators determined not to have sustained any damage. 

Rodriguez admitted the application was fraudulent as it contained a falsified letter purporting to be from her landlord. The letter claimed Rodriguez bought the damaged dwelling for $7,000 on Feb. 9, 2013, and would thereafter lease the lot for $300 per month. The landlord’s name was misspelled and was drafted without his authorization and consent. 

As a result of her scheme, Rodriguez received $33,300 from FEMA, all of which was sent to into her personal bank account.

Sentencing has been set for April 29, 2019, before U.S. District Judge Vanessa Gilmore. At that time, Rodriguez faces a maximum of 30 years in federal prison a possible $250,000 fine. She was permitted to remain on bond pending that hearing.

The Department of Homeland Security - Office of Inspector General (OIG) and the Small Business Administration – OIG conducted the investigation. Assistant U.S. Attorney Michael Day is prosecuting the case.

Members of the public are reminded to apply a critical eye and do their due diligence before trusting anyone purporting to be working on behalf of disaster victims and before giving contributions to anyone soliciting donations on behalf of disaster victims as well as being extremely cautious before providing personal identifying or financial information to anyone, especially those who may contact you after a natural disaster. Solicitations can originate from e-mails, websites, door-to-door collections, mailings and telephone calls, and similar methods. Members of the public who suspect fraud, waste, abuse or allegations of mismanagement involving disaster relief operations, or believe they have been the victim of fraud from a person or organization soliciting relief funds on behalf of disaster victims, should contact the National Disaster Fraud Hotline toll free at (866) 720-5721.  The telephone line is staffed by live operators 24 hours a day, seven days a week. You can also fax information to the Center at (225) 334-4707 or email it to disaster@leo.gov (link sends e-mail). Learn more about the NCDF at www.justice.gov/disaster-fraud and watch a public service announcement here. Tips for the public on how to avoid being victimized of fraud are at https://www.justice.gov/opa/pr/tips-avoiding-fraudulent-charitable-contribution-schemes.

An associate of a former U.S. Border Patrol Agent (BPA) pleaded guilty to conspiring to accept money in return for helping to smuggle marijuana and other illegal drugs into the United States.

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney for the Southern District of Texas Ryan K. Patrick, Special Agent in Charge Perrye Turner of the FBI’s Houston Field Office and Special Agent in Charge Juan Benavidez of the Department of Homeland Security Customs and Border Protection Office of Professional Responsibility (CBP OPR)’s Houston Field Office made the announcement.

Daniel Hernandez, 46, of Roseville, California, pleaded guilty on Feb. 5 to one count of conspiracy to bribe a public official before U.S. Magistrate Judge Nancy K. Johnson in the Southern District of Texas.  Sentencing has been scheduled for May 9, before U.S. District Judge Gray H. Miller, who accepted the plea on Feb. 8.

According to the plea documents, between 2013 and May 2014, Hernandez and the BPA agreed, and took overt acts, to facilitate the trafficking of illegal drugs, including marijuana, into the United States from Mexico on behalf of a drug trafficking organization (DTO).  In exchange for cash payments, they provided an individual they believed to be a member of the DTO with CBP sensor locations, the locations of unpatrolled roads at or near the U.S.-Mexico border, the number of BPAs working in a certain area, keys to unlock CBP locks located on gates to ranch fences along the border, and CBP radios.  In total, Hernandez accepted approximately $5,000 in cash in return for facilitating shipments of illegal narcotics into Texas without law enforcement detection.

The FBI with the assistance of CBP OPR, investigated the case.  Trial Attorneys Rebecca Moses and Peter M. Nothstein of the Criminal Division’s Public Integrity Section, and Assistant U.S. Attorneys John Pearson and Arthur R. Jones of the Southern District of Texas are prosecuting the case.

McALLEN, Texas – A local marketer has been charged for her role in a multi-million dollar illegal kickback conspiracy involving a pharmacy in the Rio Grande Valley and doctors throughout Texas, announced U.S. Attorney Ryan K. Patrick.

Victoria Renee Guerra, 35, of McAllen, made her initial appearance before U.S. Magistrate Judge Scott Hacker this morning. 

According to the criminal information, Guerra was a licensed pharmacist and worked as a marketer for a pharmacy - identified as “Pharmacy A.”

In her role as a purported marketer, Guerra allegedly recruited physicians to write prescriptions for expensive compound drugs to be filled by Pharmacy A, and for which the pharmacy would bill federal health care programs. 

During an approximately two-year period starting in late 2014, the owner of Pharmacy A paid Guerra approximately $7.5 million in return for compound drug prescriptions physicians written whom Guerra recruited. In turn, Guerra allegedly paid a cut of the payments from Pharmacy A to the prescribing physicians. For example, the complaint alleges Guerra paid approximately $2.1 million in kickbacks to just a physician for sending prescriptions to Pharmacy A. 

During the conspiracy, Pharmacy A submitted claims totaling approximately $42.2 million to the U.S. Department of Labor, Office of Workers Compensation Program, for prescriptions that doctor had written for beneficiaries of the Federal Employee’s Compensation Act, according the charges

Guerra is charged with conspiracy to violate the federal anti-kickback statute which prohibits the payment of kickbacks to induce physicians to write prescriptions for which payment may be made in whole or in part under a federal health care benefit program. If convicted, Guerra faces up to five years in federal prison and a possible $25,000 maximum fine.

The U.S. Postal Service – Office of Inspector General (OIG), Department of Labor – OIG, FBI, Veterans Affairs – OIG, Defense Criminal Investigative Service and the Drug Enforcement Administration conducted the administration conducted the investigation. Assistant U.S. Attorney Andrew Swartz is prosecuting the case.

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

HOUSTON – A local doctor who practiced in Houston for more than 30 years has been sent to federal prison following his conviction on of one count of tax evasion, announced U.S. Attorney Ryan K. Patrick along with Special Agent in Charge D. Richard Goss of IRS – Criminal Investigation. Edward J. Crouse pleaded guilty Aug. 28, 2018.

Today, U.S. District Judge Rosenthal ordered Crouse to Prison for 18 months to be immediately followed by one year of supervised release. He paid restitution of $678,103 prior to today’s hearing.

Crouse acknowledged in the plea agreement that he had not timely filed a U.S. individual income tax return since 1997.  The plea agreement states that Crouse earned more than $4.4 million in years 2009 through 2012. 

Crouse admitted in his signed plea agreement that he consistently committed numerous affirmative acts of tax evasion over the years to conceal his true income from the IRS, including concealing the complete business records of his medical practice for calendar years 2006 through 2012 from his bookkeeping and tax return preparation firm. Crouse also admitted he signed an IRS Collection form on or about May 1, 2010, in which he understated the amount of his income from his medical practice available for payment of taxes and household expenditures.

Crouse agreed that the total intended tax loss in his case was approximately $678,103.00, counting both unpaid U.S. Individual Income Taxes and the amounts of federal taxes and FICA that Crouse withheld from the wages of the employees of his medical practice but did not pay over to the IRS.

IRS-CI conducted the investigation. Assistant U.S. Attorney Charles J. Escher is prosecuting the case.

HOUSTON – A 50-year-old Honduran citizen has been charged in federal court for illegally re-entering the country after having been convicted and deported for multiple sex offenses in California, announced U.S. Attorney Ryan K. Patrick.

Marvin Mejia Ramos aka Ricardo Morales Rodriguez and Martin Jose Romes-Ramirez was charged with illegally re-entering the United States following an aggravated felony conviction and subsequent deportation. According to court records, in 2007, he was convicted in California for continuous sexual abuse and lewd act upon a child. He was sentenced to six years imprisonment for those offenses and was deported in 2013, according to the complaint.  

As such, he is not permitted to return to the United States.

However, on Jan. 30, 2019, authorities with the Precinct 4 Montgomery County Constables Office discovered him during a traffic stop in New Caney. He was subsequently charged with illegal re-entry after deportation.

At a hearing in federal court today, Assistant U.S. Attorney (AUSA) Adam Laurence Goldman argued Mejia Ramos is both a flight risk and danger to the community. U.S. Magistrate Judge Dena Hanovice Palermo then ordered Mejia Ramos into custody pending further criminal proceedings.

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

Immigration and Customs Enforcement – Enforcement Removal Operations conducted the investigation. AUSA Goldman is prosecuting the case.

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

LAREDO, Texas – A 34-year-old Laredoan has been ordered to federal prison for a carjacking and for possessing a firearm during a crime of violence which occurred in September 2017, announced U.S. Attorney Ryan K. Patrick and Special Agent in Charge Fred Milanowski of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF). Rodrigo Garza-delaCruz pleaded guilty June 19, 2018.  

Today, U.S. District Judge Marina Garcia Marmolejo ordered Rodrigo Garza-delaCruz to serve a total of 300 months in federal prison - 120 months for the carjacking and another 180 months for the related firearm offense to be served consecutively. The sentence will be immediately followed by five years of supervised release.

“Protecting our community from the most violent offenders is at the core of the ATF mission,” said Milanowski. “Taking criminals off the street who prey on our citizens while using firearms will continue to remain an ATF priority.”

On Sept. 14, 2017, Garza-delaCruz entered a park in Laredo where he shot and killed one individual.

He then carjacked an 81-year-old man while fleeing the scene. He approached the man in his vehicle and threatened to kill him if he did not drive him to Mexico. Garza-delaCruz fled with the vehicle before officers tracked him down to a residence in Laredo.

Garza-delaCruz engaged in a three-hour standoff with SWAT and a hostage negotiations team before he was ultimately apprehended.

He is also facing related charges in Webb County.

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

The ATF and the Laredo Police Department conducted the investigation. Assistant U.S. Attorneys April Ayers-Perez and Alfredo DeLaRosa prosecuted the case.

HOUSTON – The University of Texas Health Science Center (UTHSC) at Houston has paid $2,396,769.76 to resolve allegations that its Human Genetics Center misappropriated grant funds the National Institutes of Health (NIH) provided for research related to the impact of genomic variation on individual health and the health of families and populations, announced U.S. Attorney Ryan K. Patrick. A component of UTHealth, UTHSCH is one of the largest research institutions in the United States. 

“Misappropriating NIH grant funds intended to advance the health of individuals and families, as alleged here, will not be tolerated,” said Special Agent in Charge CJ Porter of U.S. Department of Health and Human Services – Office of Inspector General. “Patients can be assured the government will aggressively investigate and prosecute fraudulent use of these taxpayer funds.”    

The United States began its investigation after receiving a tip that the Genetics Center had misappropriated funds under an NIH grant related to sequencing the human genome. According to the source, the center wanted to draw down a substantial portion of the money remaining on the grant before the end of the grant period so that it would not have to return unused funds to the NIH. To accomplish this, the source claimed the center placed an order for a large quantity of genetic sequencing material from Illumina Inc. just prior to the end of the subject grant. They then allegedly stopped shipment of that material and  had Illumina establish a credit for the material, from which the Genetics Center then used to purchase goods and services after the close out of the grant.

A two-year investigation substantiated the information provided by the anonymous source. The evidence revealed that just prior to the end of the grant period in late September 2012, the Genetics Center placed an order for Human Omni 5 DNA Analysis Bead Chip Kits from Illumina in the amount of $1,198,384.88. The Genetics Center stopped delivery of the shipment after making payment to Illumina. This resulted in UTHSCH underreporting by that amount the unobligated federal funds remaining on the grant which were not returned to NIH.

This misappropriation of federal funds deprived NIH of grant funds to which it would have otherwise been entitled. These funds could have then been used for other grants.

Because Illumina had received payment for the shipment, it established a credit to the Genetics Center in the amount of $1,198,384.88. From October 2012 through to Dec. 31, 2017, the center used that credit to purchase goods and services from Illumina.

The Department of Health and Human Services - Office of the Inspector General conducted the investigation.  

Assistant U.S. Attorney Andrew A. Bobb represented the United States.

The claims resolved by this agreement are allegations only, and there has been no determination of liability. 

G Nova Corporation and Its CEO Indicted for Conspiracy to Fix Prices of Insulated Beverage Containers; Netbrands Media Corporation and Two of Its Top Executives Agree to Plead Guilty to Conspiracy to Fix Prices of Wristbands, Lanyards, Temporary Tattoos, and Buttons

A federal grand jury in Houston returned an indictment yesterday against Taiwan-based G Nova Corporation and its Chief Executive Officer Yeh Fei Chu, aka Jim Chu, for participating in a conspiracy to fix prices of insulated beverage containers sold in the United States, the Department of Justice announced today. 

The Department of Justice also announced that it has filed criminal charges against Netbrands Media Corporation and two of Netbrands’ top executives, Mashnoon Ahmed and Mueen Akhter, for their roles in a separate conspiracy to fix prices of wristbands, lanyards, temporary tattoos, and buttons sold in the United States.  Netbrands has agreed to plead guilty and pay a criminal fine of over $6 million.  Ahmed and Akhter entered guilty pleas on January 8, 2019. 

Assistant Attorney General Makan Delrahim of the Department of Justice’s Antitrust Division, U.S. Attorney Ryan K. Patrick for the Southern District of Texas, and Special Agent in Charge Perrye K. Turner of the FBI’s Houston Field Division made the announcements. 

“The results announced today are the latest in a series of charges against eleven defendants filed in the Division’s ongoing investigation into conspiracies that corrupted the online marketplace and deprived consumers of the benefits of competition,” said Assistant Attorney General Delrahim.  “Whether the conspiracy takes place in smoke-filled rooms that are real or virtual, the Department of Justice and its law enforcement partners are committed to uncovering and prosecuting collusion.”  

“We will continue to prosecute those who seek to harm consumers by conspiring to fix prices,” said U.S. Attorney Patrick.  “It doesn’t matter if the products are fifty cent insulated beverage containers or million dollar pieces of oil field equipment, the U.S. Attorney’s Office is committed to protecting competition in the marketplace and protecting consumers from people who cheat the system.”

“Antitrust violations raise prices and suppress competition, hurting businesses who play by the rules as well as consumers who pay more for products or services,” said Special Agent in Charge Turner.  “In these cases, people got greedy and their greed usurped the consumers’ right to choose between competitors.  The defendants in these cases took advantage of the niche in the markets they created and thought they could get away it.  Well, they didn’t thanks to the FBI’s unique partnership with the DOJ’s Antitrust Division and our commitment to put an end to this type of unlawful activity.”

Including the results announced today, the investigation into the customized promotional products industry has resulted in charges against five companies and six individuals. 

The charges announced today against G Nova and Chu are the first that relate to a conspiracy to fix prices of insulated beverage containers.

Including Netbrands, Akhter, and Ahmed, nine defendants have been charged for their roles in a separate price-fixing conspiracy related to sales of other customized promotional products, including wristbands.  All nine of those defendants have agreed to plead guilty. 

The Case Against G Nova and Chu:

The indictment against G Nova and Chu, filed in the U.S. District Court for the Southern District of Texas in Houston, charges the two defendants with participating in a conspiracy to fix prices of insulated beverage containers (also known as can coolers or coolies) beginning in about May 2012 and continuing until at least February 2014.  The one-count felony indictment charges that G Nova and Chu carried out the conspiracy by agreeing to fix the prices of insulated beverage containersduring meetings and other communications. 

An indictment merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt.

The Cases Against Netbrands, Ahmed, and Akhter:

According to the felony charge filed against Netbrands on January 24, 2019, the felony charges filed against Ahmed and Akhter on December 3, 2018, and the plea documents filed in the cases against Ahmed and Akhter on January 8, 2019, in the U.S. District Court of the Southern District of Texas in Houston, the defendants and their co-conspirators agreed to fix the prices of customized promotional products, including wristbands, lanyards, temporary tattoos, and buttons, sold online from as early as May 2014 until at least June 2016.  The defendants and their co-conspirators used social media platforms and encrypted messaging applications, such as Facebook, Skype, and Whatsapp, to reach and implement their illegal agreements. 

In addition to pleading guilty, Netbrands has agreed to pay a $6,531,687 million criminal fine and cooperate with the Antitrust Division’s ongoing investigation.  As part of their guilty pleas, Ahmed and Akhter also agreed to cooperate with the ongoing investigation. 

A criminal violation of Section 1 of the Sherman Act carries a maximum sentence of 10 years in federal prison and a fine of $1 million for individuals, and a maximum fine of $100 million for corporations.  The maximum fines may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.

This prosecution arose from an ongoing federal antitrust investigation into price fixing in the customized promotional products industry, which is being conducted by the Antitrust Division’s Washington Criminal I Section and the FBI’s Houston Field Division, with assistance from the U.S. Attorney’s Office for the Southern District of Texas.  Anyone with information on price fixing or other anticompetitive conduct related to other products in the customized promotional products industry should contact the Antitrust Division’s Citizen Complaint Center at 888-647-3258 or visit www.justice.gov/atr/contact/newcase.html.

**An earlier version of this release incorrectly referred to “insulated beverage containers” as “Koozies,” a trademarked term.**    

HOUSTON – A 75-year-old resident of Houston has been convicted of conspiring to commit fraud, announced U.S. Attorney Ryan K. Patrick and Special Agent in Charge James Ross of the Department of Veterans Affairs Office of Inspector General (VA-OIG).

Eduora McDaniel admitted she generated purchase orders for fictitious goods and services.

“Today’s guilty plea and associated charges underscore VA-OIG’s commitment to protecting the integrity of the funds intended for veterans,” said Ross.

As a prosthetics representative for the VA, McDaniel had the authority to obtain prosthetic goods and services if a VA physician found it medically necessary. McDaniel was authorized to pay for the goods using a government-issued VISA credit card.

As part of the scheme, she created bogus purchase orders for her co-conspirator’s company and paid them using her government credit card. McDaniel and co-conspirator Angela Hunter, 54, also of Houston, then split the payments. 

Hunter previously pleaded guilty as well. McDaniel and Hunter are set for sentencing April 30 and 24, respectively.

Conspiracy to commit wire fraud carries a possible sentence of five years as well as a $250,000 maximum possible fine.

VA-OIG conducted the investigation. Assistant U.S. Attorney Belinda Beek is prosecuting the case.

Two  Houston, Texas physicians were sentenced to 25 and three-year prison terms for their roles in separate schemes to defraud Medicare out of payments for medical services.

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Ryan Patrick of the Southern District of Texas, Special Agent in Charge Perrye K. Turner of the FBI’s Houston Field Office, Special Agent in Charge C.J. Porter of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) Dallas Region and the Texas Attorney General’s Medicaid Fraud Control Unit (MFCU) made the announcement.

US v. Ramirez S.D.T.X. Docket No. 16-cr-00258

John P. Ramirez, 65, of Houston, Texas, a physician, was sentenced to serve 25 years in prison followed by three years of supervised release by U.S. District Judge David Hittner of the Southern District of Texas.  Judge Hittner also ordered the defendant to pay $26,729,041.39 in restitution.  John Ramirez was convicted at trial in the Southern District of Texas along with his co-defendants Ann Shepherd and Yvette Nwoko. 

According to evidence presented at trial, from in or around December 2011 to in or around August 2015, John Ramirez and his co-defendants conspired and schemed to defraud Medicare out of payments for medical services.  Co-defendant Ann Shepherd owned and operated Southwest Total Medical Inc., a purported medical clinic doing business as Amex Medical Clinic in Houston.  Shepherd, along with Nwoko, sold medical orders and other documents Dr. Ramirez signed to home-health agencies in and around Houston.  Dr. Ramirez falsely certified in these medical orders information about the patient’s medical condition and need for medical services.  Co-conspirators at home-health agencies then used the false and fraudulent paperwork signed by Dr. Ramirez and sold by Ann Shepherd and Yvette Nwoko to bill to, and receive payment from, Medicare for medical services that were not medically necessary or not provided. 

In all, Dr. Ramirez and his co-defendants caused Medicare to pay approximately $17 million on false and fraudulent claims submitted during the charged conspiracy.

Ann Shepherd, 62, of Houston, Texas was also sentenced to 30 years in prison on Jan. 24, by the Honorable David Hittner.  Judge Hittner also ordered Shepherd to pay $20.928 million in restitution and to forfeit $250,000.  Nwoko will be sentenced on April 18. 

 U.S. v. Do S.D.T.X. Docket No. 17-cr-00417

Anh Do, M.D., 78, of Houston, Texas was sentenced to serve 36 months in prison followed by three years of supervised release by U.S. District Judge Andrew Hanen of the Southern District of Texas.  Judge Hanen also ordered the defendant to pay $1,875,219.00 in restitution and to forfeit $274,213.46.  Do pleaded guilty to one count of conspiracy to commit healthcare fraud on Aug. 28, 2018.

As part of his guilty plea, Do admitted to fraudulently signing Plans of Care and other medical documents that falsely and fraudulently certified and re-certified patients for home-health services.  Do and his co-conspirators made it appear as if patients qualified for and received home-health services under Medicare when those services were not medically necessary, not provided or both. Medicare paid approximately $10 million on claims for home-health services in which Do was listed as the patient’s attending physician.

Do and his co-conspirators also billed Medicare for diagnostic tests that they knew were not medically necessary, not provided or both.  Do and his co-conspirators falsely and fraudulently signed medical documents to make it appear as if the patients both needed and received the diagnostic tests.  Medicare paid approximately $2 million on claims for these diagnostic tests.

The FBI, HHS-OIG and the Texas Attorney General’s MFCU conducted both investigations.  Trial Attorney Scott Armstrong of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Tina Ansari of the Southern District of Texas are prosecuting the Ramirez case.  Trial Attorneys Devon Helfmeyer, Scott Armstrong and Drew Pennebaker of the Criminal Division’s Fraud Section are prosecuting the Do case. 

The Criminal Division’s Fraud Section leads the Medicare Fraud Strike Force.  Since its inception in March 2007, the Medicare Fraud Strike Force, which maintains 14 strike forces operating in 23 districts, has charged nearly 4,000 defendants who have collectively billed the Medicare program for more than $14 billion.  In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

McALLEN, Texas – A former Customs and Border Protection (CBP) officer has been ordered to federal prison for accepting a bribe in exchange for issuing an I-94 permit, announced U.S. Attorney Ryan K. Patrick. Jose Javier “J.J.” Gonzalez, 38, of Mission, pleaded guilty Feb. 28, 2018. 

Today, U.S. District Judge Randy Crane ordered Gonzalez to serve 30 months in federal prison, noting he had accepted a $500 bribe in exchange for issuing an I-94 permit to an individual in Pharr in 2014. The sentence will be immediately followed by three years of supervised release. At the hearing, Gonzalez claimed that he had served as a dedicated CBP officer for more than 10 years and had only made one mistake. The court noted, however, that another individual had made similar allegations against Gonzalez. 

“The defendant not only betrayed the citizens he was sworn to protect, he also betrayed the thousands of honest, hard-working CBP and other law enforcement officers who risk their lives every day to keep us safe,” said FBI Special Agent in Charge Christopher Combs. “The FBI is committed to working with our partners to pursue corruption wherever it lies. Together, we will ensure those who tarnish the badge are held accountable.” 

An I-94 permit is a travel permit that allows an individual to travel further into the interior of the United States.

The court heard that from July 2015 through November 2016, Gonzalez exceeded his law enforcement access to conduct improper queries on the Treasury Enforcement Communications System (TECS) that CBP officers use at the ports of entry. Gonzalez ran queries of a Spanish music artist, a music promoter and another individual. Despite seeing negative law enforcement information for their association to money laundering and drug trafficking, he continued to associate and communicate with them.

In addition, Gonzalez ran queries on another individual within days of his arrest at a San Diego port of entry for a drug trafficking offense and another individual who was subsequently arrested for conspiring to traffic fentanyl. Gonzalez did not have a legitimate law enforcement purpose to query either person.

Upon his arrest, authorities conducted a search warrant at his residence, at which time they found bottles of steroids and hard drives of pirated music.

Judge Crane permitted Gonzalez to remain on bond and surrender in February 2019.

The FBI conducted the investigation along with CBP - Office of Professional Responsibility. Assistant U.S. Attorney Roberto Lopez Jr. is prosecuting the case.

A former Sugar Land, Texas, resident has been arrested and detained for attempting to provide material support to the Islamic State of Iraq and al-Sham (ISIS), announced Assistant Attorney General for National Security John C. Demers, U.S. Attorney Ryan K. Patrick and Special Agent in Charge Perrye K. Turner of the FBI’s Houston Field Office.

A federal grand jury returned a sealed indictment against Warren Christopher Clark, 34, on Jan. 23, 2019. It was unsealed today following his initial appearance in federal court before U.S. Magistrate Judge Peter Bray in Houston.

Clark was captured in Syria by the Syrian Democratic Forces, transferred to U.S. law enforcement custody this week and arrived yesterday in the Southern District of Texas.

"The arm of American Justice has a lengthy reach,” said Patrick. “The number one priority of the Southern District of Texas, along with the FBI and our other national security partners, is to keep America safe. The protection of life is the most sacred job law enforcement has."

Clark is charged with attempting to provide himself as material support to ISIS, which the Secretary of State designated as a foreign terrorist organization pursuant to Section 219 of the Immigration and Nationality Act. 

“The FBI continues to aggressively pursue individuals who attempt to join the ranks of ISIS’s foreign fighters or try to provide support for other terrorist organizations. This fight against terrorism is not one we can combat alone,” said Turner. “The FBI relies on our domestic counterparts and foreign law enforcement agencies, as well as the public. Anyone who has information about individuals who have traveled or are planning to travel overseas to support terrorist groups should report it immediately to their local FBI office.”

The charged material support violation carries a possible penalty of up to 20 years in federal prison and a maximum $250,000 fine, upon conviction.

The FBI Joint Terrorism Task Force and police departments in Houston and Sugar Land conducted the investigation. Assistant U.S. Attorneys Stephen Mark McIntyre and Craig M. Feazel and Trial Attorney Michael J. Dittoe of the Justice Department’s Counterterrorism Section 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.

HOUSTON – A former Sugar Land resident has been arrested and detained for attempting to provide material support to the Islamic State of Iraq and al-Sham (ISIS), announced U.S. Attorney Ryan K. Patrick, Assistant Attorney General for National Security John Demers and Special Agent in Charge Perrye K. Turner of the FBI’s Houston Field Office.

A federal grand jury returned a sealed indictment against Warren Christopher Clark, 34, Jan. 23, 2019. It was unsealed today following his initial appearance in federal court before U.S. Magistrate Judge Peter Bray in Houston. He is set for a detention hearing Wednesday.

Clark was captured in Syria by the Syrian Democratic Forces, transferred to U.S. law enforcement custody this week and arrived yesterday in the Southern District of Texas.

"The arm of American Justice has a lengthy reach,” said Patrick. “The number one priority of the Southern District of Texas, along with the FBI and our other national security partners, is to keep America safe. The protection of life is the most sacred job law enforcement has."

Clark is charged with attempting to provide himself as material support to ISIS, which the Secretary of State designated as a foreign terrorist organization pursuant to Section 219 of the Immigration and Nationality Act. 

“The FBI continues to aggressively pursue individuals who attempt to join the ranks of ISIS’s foreign fighters or try to provide support for other terrorist organizations. This fight against terrorism is not one we can combat alone,” said Turner. “The FBI relies on our domestic counterparts and foreign law enforcement agencies, as well as the public. Anyone who has information about individuals who have traveled or are planning to travel overseas to support terrorist groups should report it immediately to their local FBI office.”

The charged material support violation carries a possible penalty of up to 20 years in federal prison and a maximum $250,000 fine, upon conviction.

The FBI Joint Terrorism Task Force and police departments in Houston and Sugar Land conducted the investigation. Assistant U.S. Attorneys Stephen Mark McIntyre and Craig M. Feazel and Trial Attorney Michael J. Dittoe of the Justice Department’s Counterterrorism Section 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.

HOUSTON – The final defendant in a maritime smuggling venture involving nearly 1300 kilograms of cocaine has pleaded guilty, announced U.S. Attorney Ryan K. Patrick.

Herman Julio Cuenu Valencia, a 34-year-old Columbian national pleaded guilty today, while Ricardo Alberto Parraga Mendoza, a 31-year-old Ecuadoran national, and Jose Luis Landazuri Valdes, a 24-year-old Colombian national, entered their pleas in November. . 

On July 3, 2018, while on routine patrol off the Pacific Coast of Colombia and Ecuador, the U.S. Coast Guard (USCG) Cutter Mohawk detected a 47-foot low profile go-fast boat 300 nautical miles northeast of the Galapagos Islands. USCG launched its small boat which approached and stopped the vessel. Officers boarded the boat and discovered three crewmen on board. 

The vessel had no flag, no registration documents, no homeport name and no indicia of identification on the hull of the vessel. Parraga Mendoza identified himself as the captain of the boat.

Officers discovered 38 bales of cocaine weighing approximately 1,280 kilograms in the hold of the boat and five sophisticated satellite communication and global positioning devices.

The three crewmen were taken into custody and transported to Florida.

They were charged with conspiracy to possess with intent to distribute more than five kilograms of cocaine on a vessel in the high seas in violation of the Maritime Drug Law Enforcement Act and the Drug Trafficking Vessel Interdiction Act of 2008. This is the first such prosecution in the Southern District of Texas following a change in the law allowing any jurisdiction in the United States to prosecute such smugglers. The law gives the United States jurisdiction over vessels without nationality found on the high seas with contraband as Congress found that “trafficking in controlled substances aboard vessels is a serious international problem and is universally condemned… Such trafficking presents a specific threat to the security and societal well-being of the United States.”

All three defendants remain in custody pending their sentencing hearings.  set for April 26, 2019, before U.S. District Judge Ewing Werlein. At that time, each defendant faces a minimum of 10 years and up to life in federal prison and a possible $10 million fine.

The Drug Enforcement Administration and USCG conducted the investigation. Assistant U.S. Attorneys Edward Gallagher and Jimmy Leo are prosecuting the case.  

McALLEN, Texas – A 47-year old resident of Rio Grande City has been indicted based on false statements he manufactured in connection with the operation of his Texas Medicaid-based durable medical equipment (DME) business, announced U.S. Attorney Ryan K. Patrick.

A federal grand jury returned the sealed indictment against Omar Cuate Canales on Dec. 18, 2018. It was unsealed today as authorities took him into custody. Canales is expected to make his initial appearance before U.S. Magistrate Judge Juan Alanis Friday morning.

The indictment alleges Canales, the owner and operator of Bluebonnet DME located in Roma, committed one count of conspiracy to submit false statements relating to health care matters, eight counts of false statements relating to health care matters and five counts of aggravated identity theft of local physicians’ names, medical license numbers and national provider identifier numbers.  

From on or about January 2010 to on or about October 2016, Canales allegedly billed Texas Medicaid in excess of $1 million for claims that were supported by either false documentation Canales created or documentation that did not exist in Bluebonnet DME records. Canales is alleged to have deliberately destroyed patient records to conceal his false claims to Medicaid.  

Each of the counts of false statements related to health care matters carries a maximum punishment of five years in federal prison and a $250,000 possible fine, upon conviction. If convicted of aggravated identity theft, Canales will also face an additional and mandatory two years in federal prison which must be served consecutively to any other prison sentence imposed.

Texas Attorney General’s Medicaid Fraud Control Unit, FBI and Department of Health and Human Services – Office of Inspector General conducted the investigation. Special Assistant U.S. Attorney Marian Swanberg and Assistant U.S. Attorney Andrew Swartz 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.

HOUSTON – An ex-employee at a local credit union has been charged with embezzlement and making false entries into the credit union’s books and records, announced U.S. Attorney Ryan K. Patrick. Another ex-employee was also charged with embezzlement related to the scam.

A federal grand jury charged Susanna Guajardo, 42, of Pearland in a five-count superseding indictment returned under seal Dec. 12, 2018. She was taken into custody today, at which time the indictment was unsealed, and is expected to make her initial appearance before U.S. Magistrate Judge Frances Stacy today at 10:00 a.m.   

Grace Garza aka Grace Valencia, 48, of Pasadena, was originally charged last month with two counts of embezzlement and was released on bond. She is expected to appear again in court on these charges in the near future.

Guajardo is alleged to have committed embezzlement of $1,154,876 and three counts of making false entries into the books and records of a federal credit union between at least 2010 and 2018. The indictment alleges Garza committed two counts of embezzlement – the $1,154,876 along with Guajardo as well as a separate embezzlement of $110,000.     

If convicted of any of the charges, each faces up to 30 years in federal prison and a possible $1 million fine.   

The FBI conducted the investigation. Assistant U.S. Attorney Belinda Beek 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.

McALLEN, Texas – An operator of a durable medical equipment (DME) company was ordered to federal prison following his admission of defrauding Medicaid, announced U.S. Attorney Ryan K. Patrick. George Louis Moreno, 59, of McAllen, pleaded guilty Jan. 24, 2018.

Today, U.S. District Judge Micaela Alvarez handed Moreno a 36-month sentence to be immediately followed by three years of supervised release. Moreno was also ordered to pay approximately $1.5 million in restitution to the Texas Medicaid Program. 

Moreno was the owner and operator of MARS DME Inc. located in McAllen. From August 2008 to January 2016, Moreno submitted numerous false and fraudulent claims for incontinence supplies, resulting in approximately $1.5 million loss to Medicaid. Specifically, Moreno submitted claims for incontinence supplies that were not delivered to beneficiaries. In many instances, Moreno billed Medicaid for large quantities of higher-reimbursing incontinence supplies, when in fact the company was delivering smaller quantities of inexpensive supplies to recipients. Moreno also paid cash to some beneficiaries in lieu of delivering supplies.

Moreno was permitted to remain on bond and voluntarily surrender Jan. 2, 2019.

The Texas Attorney General’s Medicaid Fraud Control Unit, Department of Health and Human Services‐Office of Inspector General, FBI and Texas health and Human Services Commission conducted the investigation. Assistant U.S. Attorney (AUSA) Andrew Swartz and Special AUSA Marian Swanberg are prosecuting the case.

BROWNSVILLE, Texas – A 25-year-old resident of Brownsville has been ordered to prison for 300 months for his role in recruiting a female to carry almost four kilograms of “ice” to Louisiana, announced U.S. Attorney Ryan K. Patrick. Emmanuel Ravell pleaded guilty Oct. 31, 2017.

Today, U.S. District Judge Fernando Rodriguez Jr. imposed the sentence noting the serious nature of the trafficking in methamphetamine as well as the defendant’s prior lengthy criminal history. Ravell was further order to serve five years of supervised release following the sentence. He was also was sentenced to a concurrent 120 months for being a felon in possession of more than three firearms.

In 2016, Ravell was contacted by a local drug trafficking organization to find a drug “mule” to get a load of methamphetamine to Louisiana. Ravell recruited a young female from Brownsville to carry the load on a commercial bus line. Law enforcement intercepted the woman carrying the approximately-four kilograms of methamphetamine on her person. Ravell had strapped the drugs to her. .

Ravell was a convicted felon ineligible to purchase a firearm. However, in 2017, he purchased three firearms, including an AR-15, GGI rifle and .50 caliber Desert Eagle pistol.

Ravell remains in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.

The Drug Enforcement Administration, FBI and Bureau of Alcohol, Tobacco, Firearms and Explosives conducted the joint investigation. Assistant U.S. Attorneys Karen Betancourt and Angel Castro prosecuted the case.

McALLEN, Texas ‐ A former Pharr City Commissioner has been ordered to  prison in connection with a scheme to defraud Blue Cross Blue Shield of Texas, announced U.S. Attorney Ryan K. Patrick. Oscar Elizondo, 48, of Pharr, pleaded guilty to conspiracy to commit health care fraud Nov. 29, 2017.

Elizondo was charged with conspiring with the owner of Penitas Family Pharmacy aka Riverside Pharmacy, located in Penitas, to submit more than $1.7 million in fraudulent claims to Blue Cross Blue Shield of Texas (BCBS) for expensive pain patches and scar creams. 

Today, U.S. District Judge Randy Crane imposed a 22-month prison sentence to be followed by a three-year term of supervised release. Elizondo was also ordered to pay more than $1.4 million in restitution to BCBS, the amount they paid based on the fraudulent claims.

In handing down the sentence, Judge Crane characterized the scheme as “blatant fraud” and a “complete ruse.” Crane further noted that although the fraudulent claims were submitted to BCBS, the scheme also defrauded local school districts, municipalities and small businesses, who had self-funded health insurance programs through BCBS. 

Co-defendant Omar Espericueta, 46, of Palmhurst, pleaded guilty Dec. 1, 2017, and is set for sentencing in May 2019.

During an approximately five-month period starting in late 2015, Elizondo and his co-conspirators recruited marketers to target employees of entities throughout the Rio Grande Valley with BCBS insurance. The marketers solicited employees with meals, drinks and promises of “free” prescription pain patches and scar creams in order to obtain their health insurance information. The co-conspirators then used the insurance information, along with fraudulent prescriptions, to submit hundreds of fraudulent and medically unnecessary claims to BCBS. Prescriptions were written for individuals who never saw a doctor and did not want or need pain patches or scar creams. Other individuals were taken to a doctor, but it was a doctor with whom Elizondo and his co-conspirators had made arrangements to sign fraudulent prescriptions in exchange for cash, fake loans and prescription pain killers.

Employees who were targeted in the scheme were falsely told that the prescription medication was “free,” when in reality Penitas Pharmacy planned to use their health insurance information to bill BCBS for several thousand dollars worth of prescriptions for each employee. In many instances, the defendants billed BCBS for prescriptions that were never delivered to employees, including multiple refills that were never requested.

Elizondo 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 FBI, Mission Police Department, Texas Department of Insurance – Fraud Unit and Texas Health and Human Services Commission conducted the investigation. Assistant U.S. Attorney Andrew Swartz is prosecuting the case.

HOUSTON - A Nigerian national was charged in court documents unsealed today for his role as the alleged ringleader of an international advance-fee scheme.

The scam allegedly involved false promises of investment funding by individuals who impersonated U.S. bank officials in person and over the internet to victims around the world who were told they had to make certain payments before they could supposedly receive their funding. Proceeds of the scheme were allegedly laundered through U.S. bank accounts and diverted back to the scheme’s perpetrators in Nigeria.

U.S. Attorney Ryan Patrick, Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, Special Agent in Charge Perrye K. Turner of the FBI’s Houston Field Office and Special Agent in Charge Robert Smolich of the U.S. Department of State - Office of Inspector General (DOS-OIG) made the announcement. 

Osondu Victor Igwilo, 49, of Lagos, Nigeria, was charged in a complaint filed in the Southern District of Texas in December 2016 and unsealed today. The complaint charges Igwilo with one count of wire fraud conspiracy, one count of money laundering conspiracy and one count of aggravated identity theft. Igwilo remains a fugitive.     

As alleged in the complaint, Igwilo was the leader of a criminal network of “catchers,” who sent phishing emails to potential victims falsely offering investment funding on behalf of BB&T Corporation, a U.S. bank headquartered in North Carolina. When victims were interested in the supposed investment funding, Igwilo allegedly dispatched U.S. citizens whom he had recruited over the internet to pose as “representatives” of BB&T to meet in person with the victims and sign a supposed investment agreement on behalf of BB&T. When traveling to the countries where the victims resided, these representatives, at Igwilo’s direction, would visit the local U.S. embassy or consulate and employ fake documents with fraudulent seals of the U.S. government to deceive the victims into believing that the investment agreement was sponsored by the U.S. government, according to the complaint. Igwilo then allegedly used the representatives and catchers to convince victims to make wire payments to bank accounts in the United States on the false belief that such payments were necessary to effectuate the investment agreements. The complaint further alleges the holders of the U.S. bank accounts were “money movers” who disposed of the funds as directed by Igwilo, including by purchasing luxury vehicles from brands such as Mercedes Benz and Range Rover and shipping them to Nigeria.

Uche Diuno, 52, also of Lagos, was charged in a separate case in a second superseding indictment filed Oct. 3, 2018, with one count of wire fraud conspiracy, one count of money laundering conspiracy and one count of concealment money laundering. Diuno was arrested in Paris, France, on Sept. 29, 2018, and is awaiting extradition.

As alleged in the second superseding indictment, Diuno was a “chairman” or leader in the scheme who operated his own network of catchers and money movers alongside Igwilo’s which he used in furtherance of the same BB&T investment scam. 

Seven other individuals have been charged to date as part of the same investigation including Uju Okigbo, 49, and Chioma Okafor, 29, both of Houston and alleged money movers; Tochukwu Nwosisi, 47, of Indianapolis, Indiana, also an alleged money mover; and Marita Ranalan Underwood, 62, of Manila, Philippines, John Christian Rutledge, 65, of Yaphank, New York, Osa May Martin, 69, of Carthage, Missouri, and Tiffany Sourjohn, 48, of Miami, Oklahoma, all alleged representatives.

Okigbo, Okafor, Rutledge and Sourjohn have pleaded guilty and are awaiting sentencing. Underwood remains a fugitive. Martin and Nwosisi are pending trial.  

The FBI and DOS-OIG conducted the investigation. Assistant U.S. Attorney (AUSA) Suzanne Elmilady of the Southern District of Texas and Trial Attorney William E. Johnston of the Criminal Division’s Fraud Section are prosecuting the case. AUSA Kristine Rollinson is handling forfeiture aspects of the case.

The charges in the complaint and second superseding indictment are merely allegations.

Defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

HOUSTON – A 51-year old nurse from Sugar Land is headed to federal prison following his convictions of conspiracy to commit health care fraud, six counts of health care fraud and conspiracy to violate the anti-kickback statute, announced U.S. Attorney Ryan K. Patrick. A federal jury returned the guilty verdicts against John Dubor May 17, 2018, after deliberating less than six hours following a three-day trial.

Today, U.S. District Judge Andrew Hanen handed Dubor a 109-month sentence to be immediately followed by three years of supervised release. At the hearing, the court heard arguments regarding the loss to the Medicare program and ordered Dubor to pay $3,534,972 in restitution.

Dubor owned and operated Care Committers Health Services home health agency in Richmond. During the trial, the jury heard evidence that Dubor paid marketers and group home owners for Medicare beneficiary information and subsequently billed Medicare and Medicaid for home health services for which the beneficiaries did not qualify and/or did not receive. 

Additionally, Dubor personally falsified home health patient assessment forms to make the beneficiaries appear sicker on paper to receive higher reimbursement rates from Medicare. Dubor also instructed his employees to falsify home health certifications and forge physician signatures. The beneficiaries, some of whom, resided in Nacogdoches, had no recollection of ever being treated by the Houston physicians listed on their home health orders. Medicare paid Dubor approximately $3.5 million.

Dubor was taken into custody following the jury trial where he will remain pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.

The Department of Health and Human Services – Office of Inspector General and the Texas Attorney General’s Medicaid Fraud Control Unit conducted the investigation. Special Assistant U.S. Attorney (AUSA) Justin Blan and AUSA Tina Ansari are prosecuting the case.

HOUSTON – A 41-year-old Houston man is headed to prison after for trafficking children for commercial sex and attempting to do so during the 2012 Olympics, announced U.S. Attorney Ryan K. Patrick. 

A federal jury convicted Jason Daniel Gandy July 23, 2018, on four counts of sex trafficking of minors, one count of transportation of minors, one count of sexual exploitation of a child and one count of transportation of child pornography following a three-day trial and less than three hours of deliberations.

Today, Chief U.S. District Judge Lee H. Rosenthal ordered Gandy to serve a total of 360 months in prison. Following his incarceration, Gandy will be on supervised release for the rest of his life, during which time he will have to comply with numerous requirements designed to restrict his access to children and the internet. He will also be ordered to register as a sex offender.

At the hearing, three young men provided testimony about how Gandy victimized them and how it impacted, and continues to influence, their lives. They stated that Gandy had made them feel worthless and stole their innocence and that they have struggled with substance abuse and thoughts of suicide since their victimizations. 

The court gave Gandy the opportunity to address the court, at which time he continued his attempts at manipulating the victims. He showed no remorse and attempted to cast himself in the role of victim.

In imposing the sentence, Judge Rosenthal called Gandy “an abuser of vulnerable human beings.” “You are evil,” she said, “and most evil are those who willingly exploit others for their own gratification.” The court noted the need for restitution for the victims outweighed the need for a fine and therefore waived it. That restitution will be addressed at a later date. 

United Kingdom immigration officers stopped Gandy in July 2012 after he and a minor male child arrived in London on a flight which originated in Houston. The officials in London believed something was amiss about someone of his age traveling with a 15-year-old male who are not related.  Both individuals were returned to Houston on separate airplanes.

Upon arrival in Houston, Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) met them. Their investigation revealed Gandy ran a massage business out of his home and was using the young boy to give massages. During the massages, paying customers were allowed to fondle the child. He was also required to sexually gratify customers by masturbating them.

Gandy paid for the trip to London and the child’s passport fees. Gandy’s intent was for the child to perform massages in London during the 2012 Olympics.   The investigation also revealed Gandy molested the child on more than one occasion and intended to continue to do so. 

After authorities had detained Gandy on the original transportation of minor charge, further investigation revealed there were multiple young men who Gandy victimized, some as minors and some as adults. During trial, four of the identified victims - all minors at the time of the exploitation - testified as to how Gandy manipulated them into performing massages on men which culminated in the sexual gratification of the client. 

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

HSI conducted the investigation.

Assistant U.S. Attorneys Sherri L. Zack and Kimberly Ann Leo prosecuted the case, which was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to locate, apprehend and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."

CORPUS CHRISTI, Texas – A 22-year-old Corpus Christi man has entered a guilty plea to robbery and brandishing a firearm in furtherance of a crime of violence, announced U.S. Attorney Ryan K. Patrick.

On March 14, 2018, the Corpus Christi Police Department (CCPD) responded to an aggravated robbery at the Whataburger located in the 4100 block of South Staples. Upon their arrival, officers discovered that a male – later identified as Dveaunta Montez Hall, 22 - had entered the business and pointed an assault rifle employees and customers while demanded money from the register. He then fled the location on foot.

A short while later, responding officers located Hall, who still had the assault rifle in his possession, near the location. During the investigation, officers discovered Hall had stolen the assault rifle from a nearby apartment shortly before committing the robbery.

Senior U.S. District Judge John D. Rainey accepted Hall’s plea today and set sentencing for March 17, 2019. At that time, he faces up to 20 years imprisonment and a maximum $250,000 fine for the robbery and a minimum and mandatory seven years for brandishing a firearm during a crime of violence, which must be served consecutively to any other prison term imposed.

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

CCPD and the Bureau of Alcohol, Tobacco, Firearms and Explosives conducted the investigation. Attorney Lance Watt is prosecuting the case.

GALVESTON, Texas – A 41-year-old Mexican national who illegally resided in Houston has been ordered to prison following his conviction of conspiracy to possess with intent to distribute cocaine and methamphetamine, announced U.S. Attorney Ryan K. Patrick. Agusto Lazo-Aguirre pleaded guilty March 2, 2018.  

Today, U.S. District Judge George C. Hanks Jr. ordered him to prison for 325 months. Not a U.S. citizen, he is expected to face deportation proceedings following his release. At the hearing, Lazo-Aguirre was found to be a leader, manager and organizer of the group and was found to have distributed or been responsible for the distribution of more than five kilograms of cocaine and more than 50 grams of actual methamphetamine during the course of the conspiracy between July 1, 2015, and Feb. 22, 2016. 

Previously sentenced were Tony Perez, 24, of Dickinson and Carlos Chayane Morales, 27, of Galveston. Perez received a 168-term of imprisonment, while Morales was ordered to serve a sentence of 120 months.

The investigation began in September 2014. It revealed Lazo-Aguirre purchased cocaine and methamphetamine from several sources in the Houston area and worked with known co-conspirators, such as Perez and Morales. They facilitated the distribution of cocaine and methamphetamine in the Houston-Galveston area and to other destinations throughout the United States.

Those that participated in the conspiracy obtained drugs from or through Lazo-Aguirre and delivered or sold the same drugs in the Houston-Galveston area. They obtained payments in cash for the drugs and returned it to Lazo-Aguirre. Lazo-Aguirre paid these other persons in cash or with drugs.

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.

The Drug Enforcement Administration conducted the investigation. Assistant U.S. Attorney Kenneth Cusick is prosecuting the case.

HOUSTON - A 22-year-old Chinese national who resided in La Marque has admitted to possessing a firearm while being an illegal alien and to aggravated identity theft, announced U.S. Attorney Ryan Patrick along with Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) Special Agent in Charge Mark Dawson and Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) Special Agent in Charge Fred Milanowski.

Xiangyu Zhang remained in the United States two years after his visa expired. He came to law enforcement’s attention in July 2018 when he entered an internet chat session on the Department of Veteran’s Affairs (VA) Crisis Line and threated to kill school children by using firearms. Zhang is a not a U.S. veteran. 

“We believed that this individual presented a real danger to the community based on the threats that he made to the Veteran’s Crisis Hotline,” said Dawson. “Within days of being alerted to those threats, our special agents were able to conduct their investigation, secure an arrest warrant and locate and arrest the subject before he had the opportunity to harm anyone.”

Law enforcement arrested him at a gas station located close to his residence. At that time, he was sitting in a vehicle in possession of two firearms, including an AM-15 rifle. Both firearms had rounds in the chamber.  

“Holding people responsible for unlawfully being in possession of firearms and fighting violent crime remains at the forefront of the ATF mission,” said Milanowski. “Working with our partners at HSI to become a force multiplier will ensure our community is safe.”

Upon Zhang’s arrest, law enforcement also found a passport belonging to a woman who lived in the Dallas area. Zhang had stolen the woman’s purse containing the passport in August 2017 after he served as her Uber driver. Within hours of stealing her purse, Zhang, while using the woman’s identity without her permission, attempted to purchase several high end items online from Apple.  

Law enforcement also found a picture of a fake U.S. passport page with Zhang’s picture and the woman’s passport number on Zhang’s phone. 

A few months after stealing the purse, Zhang defrauded Bank of America in March 2018 for more than $11,000. In late June 2018, and a few days before making those threats on the VA chat line, Zhang stole an IRS refund check from his neighbor’s mailbox and deposited it into his bank account. 

U.S. District Judge Gray Miller accepted Zhang’s pleas today and set sentencing for March 19, 2019. At that time, he faces up to 10 years imprisonment and a maximum $250,000 fine for the firearm possession charge. He also faces a mandatory two years for the identity theft which must be served consecutively to any other prison term imposed.

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

HSI and ATF conducted the investigation. Assistant U.S. Attorney Alamdar Hamdani is prosecuting the case.

HOUSTON - An international businessman and his wife have learned their fate for international parental kidnapping, announced U.S. Attorney Ryan K. Patrick and Special Agent in Charge Perrye K. Turner of the FBI. A federal jury deliberated for more than two days following a 10-day trial before convicting Carlos Otavio Guimaraes, 68, and Jemima Guimaraes, 66.

Today, U.S. District Judge Alfred Bennett heard arguments from both the prosecution and defense teams. The government requested the court impose a term of imprisonment advised by the sentencing guidelines or slightly higher, while the defense asked for a non-custodial sentence. Ultimately, the court imposed a three-month sentence for Carlos Guimaraes, while Jemima was ordered to serve one month. Both will also be ordered to serve one year of supervised release following their terms of imprisonment during which time they will be required to remain in the United States. The court continued its order that both their U.S. and Brazilian passports remain surrendered and they cannot obtain new ones. The court also ordered the defendants may not have any contact with their fugitive co-defendant daughter, but placed no prohibition on communicating with their grandson.

Each was also ordered to pay a $75,000 fine. Restitution will be determined at a later date, but could be in excess of $400,000.

At the hearing, the judge also heard from the victim – the child’s father – who gave impassioned testimony about how this has impacted him and how much he misses his son. He stated that he has been “emotionally crippled by this experience. What my family and I have endured at the hands of these defendants has been so painful that I cannot imaging inflicting it on another human soul. How do you take away a parent’s right to have their child in their life?” He further noted that he has been consumed by grief. “My boy was just gone,” he said. “For years, I have begged and begged and begged them to bring my boy back, but they refused.”

The father also told the court the court that each trip to Brazil to see his son for even a short time cost him close to $20,000 and that, for years, he had been working an enormous amount of hours - averaging 100 a week - just to finance his fight to try to get his son back.

He also noted that what these defendants did was devoid of any concern for the child’s well-being, that the decision was motivated by greed, power, control and fear – fear not of him, but that he would get in the way of them taking the child for themselves. “They sought to enforce their own brand of vigilante justice,” he said, adding that the couple had undermined orders, lied to the court and succeeded in obtaining full custody of the child, noting they had stripped him of his parental rights, “making a mockery of the United States judicial system.”

At trial, the jury heard that the child’s grandparents helped illegally retain the child in Brazil away from his father in Houston. The mother and minor child traveled to Brazil to attend a family event in July 2013, but were supposed to return to Houston no later than July 20, 2013. The child was never returned to the United States.  

The jury also heard how the child’s mother allegedly orchestrated a plan to travel to Brazil for her brother’s wedding via an agreed travel agreement as part of the pending divorce. While in Brazil, she went to a Brazilian state court and obtained custody of the minor. From that moment forward, the father of the child was limited in his ability to visit with his son. The visits he did have were supervised by a guard hired by the child’s mother. Currently, despite a Harris County divorce ruling in 2015 favorable to the father, his ability to maintain a relationship with his son has been incredibly difficult. The child no longer speaks English, and the father had to learn Portuguese to navigate the Brazilian legal system and communicate with his son.

The child’s father testified and told the jury that all he ever wanted was for his son to return to Houston so he could be a constant presence in his life. 

Evidence was also presented which included the fact that the grandparents support their daughter by providing housing and employment as well as attorney fees. Additionally, when the father would visit Brazil, Jemima was present for most of the exchanges of the child. Video evidence showed both Carlos, Jemima, the hired guard and their Brazilian attorney at one of the exchanges.

The defense attempted to convince the jury that the Brazilian court rulings should be respected despite the fact they disregard the father’s position. The rulings found the United States was not the place to raise a child in the “egotistical profile of the American family.” 

The defense provided an expert on the Hague Convention to testify, but that expert was unable to give even one example of a child that has been returned from Brazil when the abducting parent was alive and domiciled in Brazil. Further, the expert acknowledge the U.S. State Department has found Brazil to be non-compliant with the provisions of the Hague Convention on the Civil Aspects of International Child Abduction since 2005.

The defendants claimed the mother was fleeing from domestic violence, but the jury rejected that defense. The jury ultimately found Carlos and Jemima Guimaraes aided and abetted their daughter in the international parental kidnapping of their grandson.  

They were permitted to remain on bond and voluntarily surrender to a U.S. Bureau of Prisons facility to be determined in the near future. 

The child’s mother - Marcelle Guimaraes, 40 - is also charged but remains a fugitive in Brazil. She is presumed innocent unless and until convicted through due process of law.

The FBI conducted the investigation. Assistant U.S. Attorneys Sherri L. Zack and Kimberly Ann Leo are prosecuting the case.

If you are a parent or legal custodian who has been deprived of your child through abduction, please see the Department of Justice’s International Parental Kidnapping webpage for more information.

CORPUS CHRISTI, Texas – A total of 16 South Texas residents have been convicted of charges including conspiracy to participate in racketeering activity involving the Aryan Brotherhood of Texas (ABT) which also involved methamphetamine distribution, announced U.S. Attorney Ryan K. Patrick.   

Today, U.S. District Judge Nelva Gonzales Ramos sentenced James Randall Lee Ross, 45, OF Corpus Christi, aka “Silver” to 292 months in federal prison followed by five years of supervised release.

Previously sentenced were Corpus Christi residents David Wayne Frost aka Spider, 47, Michael Lee Craig aka Rooster, 44, Mark Clairborne Pennington aka Shiloh, 59, Brian Russell Campbell aka Iceman aka Loyalty, 35, Johnny Glenn Voiles aka Panhead, 47, Jimmy Curtis Mullenax III aka Curt, 40, Kenneth Brandenburh aka K-Dog, 44, Matthew Jay Thompson aka Pie Face, 33, Pedro Campos aka Pete, 59, Abby Telge, 28, Johnny Hagensick, 49, Randy Stasney, 60, Allen Saunders, 35, Blanca Blanche Sandoval, 40, and Sue Campbell, 34.

They received terms of imprisonment ranging from 120 to 292 months in federal prison.  

All defendants and others known and unknown, were members and associates of the ABT, a criminal organization whose members and associates engaged in the illegal trafficking of controlled substances, extortion, murder, attempted murder, assault with a dangerous weapons and other acts of violence. The organization operated throughout Texas, including Corpus Christi.

One of the purposes of the criminal enterprise was to keep victims in fear of the enterprise and in fear of its leaders, members and associates through threats of violence and actual violence. Ross, Frost, Craig, Pennington, Campbel, and Voiles were convicted of conspiracy to participate in racketeering activity involving ABT between 1995 and 2017. Ross, Frost and Craig were also convicted of violent crimes in aid of racketeering activity occurring in September 2015. All 16 were also convicted of conspiracy to possess with the intent to distribute methamphetamine between July 2012 to 2017.               

Evidence was discussed and presented during the multiple plea and sentencing hearings in this case regarding the extent of this criminal organization. The ABT is a powerful race-based Texas state-wide organization operating inside and outside state and federal prisons throughout the State of Texas and the United States. ABT was established in the early 1980s within the Texas Department of Criminal Justice (TDCJ). It modeled itself after and adopted many of the precepts and writings of the Aryan Brotherhood, a California-based prison gang formed in the California prison system during the 1960s. ABT offers protection to white inmates if they join the criminal enterprise. They adhere to the motto that "God Forgives, Brothers Don't." Membership is for life. The only way out of the gang is by death. ABT members refer to the gang as the "Family" and promote "whites as the superior race."

The ABT operate with a strict chain of command and a defined militaristic ranking structure. The hierarchy of each faction is broken up into five separate TDCJ regions. Each region has the following chain of command: general, major, captain, lieutenant, sergeant-at-arms and soldier. The ranking structure remains constant; however, frequent personnel changes (promotions, demotions, terminations) occur within the rank structure. The "Wheel," a five-person steering committee, governs each faction of the ABT. Each Wheel member is a general who is responsible for appointing his subordinate within his respective regions. Each Wheel member also appoints an inside major (in-custody gang member) and outside major (referring to someone in the "free world") in each of his respective region. These majors, in turn, are responsible for appointing their subordinate captains and lieutenants who, in turn, appoint their sergeants. Wheel members typically remain in place regardless of custody status unlike other ranking members who typically lose rank when their custody status changes.

The ABT has been involved in racketeering activities almost since its inception. Identity theft, counterfeiting and check fraud constitute the most prevalent non-violent crimes committed by ABT members/prospects/associates. Through the commission of these offenses, along with the distribution of narcotics, the ABT generates income for the enterprise.

ABT members take a "blood oath" to obey superiors. Failure to obey may result in a severe beating or death, which is carried out by other ABT members/prospects/associates. ABT members/prospects/associates that cooperate with law enforcement authorities are also subject to murder.

Multiple defendants were also convicted of a large-scale drug-trafficking conspiracy involving kilogram quantities of pure methamphetamine that had been trafficking in the Corpus Christi area since at least 2012 and continuing to 2018. 

Immigration and Custom’s Enforcement’s Homeland Security Investigations;  Bureau of Alcohol, Tobacco, Firearms and Explosives; Drug Enforcement Administration; Texas Department of Public Safety; Nueces County Sheriff’s Office; Corpus Christi Police Department; and the U.S. Marshals Service conducted the joint investigation.

Assistant U.S. Attorneys Lance Watt and Julie K. Hampton are prosecuting the case.   

HOUSTON – A former procurement officer of Venezuela’s state-owned and state-controlled energy company, Petroleos de Venezuela S.A. (PDVSA), pleaded guilty today. Alfonso Eliezer Gravina Munoz (Gravina), of Katy, admitted to his role in a scheme to obstruct an investigation relating to bribes paid by the owner of U.S.-based companies to Venezuelan government officials in exchange for securing additional business with PDVSA and payment priority on outstanding invoices.

U.S. Attorney Ryan K. Patrick, Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and Special Agent in Charge Mark Dawson of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) in Houston made the announcement.

Gravina, 56, previously worked for PDVSA in Houston. He pleaded guilty today before U.S. District Judge Kenneth M. Hoyt to one count of conspiracy to obstruct an official proceeding. Gravina is scheduled to be sentenced on Feb. 19, 2019, before Judge Gary H. Miller. He was indicted Nov. 15, 2017.

Gravina pleaded guilty to one count of conspiracy to launder money and one count of making false statements on his federal income tax return. Gravina’s plea agreement in that case was a cooperation plea agreement which contemplated the possibility the United States would make a motion to reduce his sentence based on his cooperation. Under the terms of the plea agreement, Gravina agreed to participate in interviews as requested by the United States and to provide “truthful, complete and accurate information” to government agents and attorneys. 

According to admissions made in connection with Gravina’s plea in this case, Gravina met periodically with HSI special agents to provide information regarding corruption at PDVSA. Gravina knew U.S. government authorities were investigating corruption at PDVSA and that at the beginning of 2018, the government was focusing on bribes paid by companies controlled by an individual referred to as co-conspirator 1. However, Gravina concealed facts about co-conspirator 1’s bribe payments to PDVSA officials in his interviews with the government. In addition, Gravina informed co-conspirator 1 that U.S. government authorities were investigating co-conspirator 1 and provided that person with information about the investigation, including the topics discussed in Gravina’s meetings with the government. This passing of information led to co-conspirator 1 and others destroying evidence and co-conspirator 1 attempting to flee the country in July 2018.

Gravina becomes the latest individual to plead guilty as part of a larger, ongoing investigation by the U.S. government into bribery at PDVSA. Including Gravina, the Justice Department has announced the guilty pleas of a total of 15 individuals in connection with the investigation.

HSI Houston is conducting the ongoing investigation with assistance from HSI in Boston and Madrid, as well as from IRS - Criminal Investigation. Assistant U.S. Attorneys (AUSAs) John P. Pearson and Robert S. Johnson of the Southern District of Texas are prosecuting the case along with Trial Attorneys Sarah E. Edwards and Sonali D. Patel of the Criminal Division’s Fraud Section. AUSA Kristine Rollinson is handling the forfeiture aspects of the case.

The Fraud Section is responsible for investigating and prosecuting all FCPA matters. Additional information about the Justice Department’s FCPA enforcement efforts can be found at www.justice.gov/criminal/fraud/fcpa.

CORPUS CHRISTI, Texas – A 55-year-old Robstown man has been ordered to federal prison for nearly 20 years following his multiple convictions as related to a cocaine and heroin conspiracy, announced U.S. Attorney Ryan K. Patrick. A federal jury convicted Rolando Hinojosa Jan. 11, 2018, following a two-day trial of conspiracy to possess with intent to distribute cocaine and heroin, possession of 2.9 kilograms of cocaine and conspiracy to launder narcotics proceeds.

Today, U.S. District Judge Janis Graham Jack ordered him to prison for 235 months. The court also ordered the forfeiture of his interest in his residence and $96,445 seized at the time of his arrest.  

At today’s hearing, Judge Jack commented that Hinojosa has been involved in moving a lot of heroin for many years.

During the trial, the jury heard that an undercover officer had begun purchasing heroin from the organization in April 2016. Members of the conspiracy testified that the organization was involved in two types of narcotics trafficking - local, large-scale heroin distribution in Nueces County and interstate distribution of kilogram quantities of cocaine. Hinojosa was the source of supply for both types of narcotics.

The jury also learned about a pre-paid telephone found on Hinojosa’s bedside table that led to authorities discovering the trail of cocaine from Hinojosa to a Kentucky distributor. From further phone analysis, authorities discovered a narcotics courier who had been arrested in August 2017 returning from Kentucky with $76,000 in narcotics currency intended for Hinojosa. 

That courier testified at trial that he successfully delivered several kilograms of cocaine to Kentucky in August 2017 after receiving it from Hinojosa.

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

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

BROWNSVILLE, Texas – The final member of the Magallanes family residing in both Brownsville and Pasadena has been sentenced to conspiring to run a money laundering organization as a part of a larger human smuggling conspiracy based in the Rio Grande Valley, announced U.S. Attorney Ryan K. Patrick. All six family members had pleaded guilty to conspiracy to launder monetary instruments by funneling human smuggling proceeds through their bank accounts with various financial institutions. 

Today, U.S. District Judge Fernando Rodriguez Jr. order the leading family member - Veronica Ofelia Magallanes, 41 - to 48 months in federal prison. The court also ordered a money judgment in the amount of $457,000.

Those previously sentenced were Rosa Maria Alvarado, 37, who received a 24-month-term of imprisonment; Bertha Alicia Magallanes, 35, and Paloma Garcia, 36, who were both ordered to serve 12 months in prison; Jose Alfredo Magallanes, 37, was sentenced to 18 months, while the court imposed a 27-month-term upon Jesus Magallanes, 43.

The Magallanes family members engaged in the conspiracy from approximately Jan. 3, 2007, to July 19, 2016. They used Money Gram, Western Union and their personal Wells Fargo bank accounts to launder money given to them which was later provided to human smugglers based in Mexico. The deposits into the Magallanes accounts were made in the United States and foreign countries including Canada, China, Macedonia, Eritrea, Romania, Somalia, Honduras, Guatemala, El Salvador and Mexico. Once they received payments, the Mexico-based human smugglers would later bring illegal aliens into the United States. 

This operation grossed a total of approximately $1,296,268.41 over the time of the conspiracy.

Immigration and Customs Enforcement’s Homeland Security Investigations - Financial Crime Unit in Harlingen conducted the two-year investigation. Assistant U.S. Attorney Justin Schorr Dinsdale prosecuted the case.

HOUSTON - The five leaders and eight other co-conspirators have been sentenced for their roles in one of the largest synthetic cannabinoids distribution networks in the United States, announced U.S. Attorney Ryan Patrick. The sentences ranged from 140 months in federal prison for a leader to probation for an hourly wage clerk who sold the drugs. 

The defendants were sentenced for their involvement in the manufacture, possession and distribution of synthetic cannabinoids commonly, but mistakenly, referred to as synthetic marijuana.

Today, U.S. District Judge Gray Miller ordered Khader Fahed Tanous, 52, of Manassas, Virginia, who distributed large amounts of synthetic cannabinoids to Houston area distributors, to 121 months imprisonment. Earlier this week, Judge Miller sentenced Muhammad Shariq Siddiqi, 48, of Sugar Land, to 140 months in prison. Siddiqi was a major manufacturer and distributor in the Houston area.

Also sentenced today was Ayisha Khurram, Siddiqi’s partner in manufacturing and distributing synthetic cannabinoids as was the de facto owner of the Smoke Zone Khalil Munier Khalil, 43, of Spring. The Smoke Zone was the most prolific distribution store front in the country for synthetic cannabinoids. Khalil was sentenced to a 135-month prison term while Khurram received a 95-month term of imprisonment.

Today, Judge Miller further sentenced Sayed Ali, 53, of Sugar Land; Abdalnour Izz, 33, of Houston; Steve Amira, 61, of Richmond; Mohammed Rafat Taha, 29, of Spring; and Frank Muratalla, 25, of Downey, California.

Siddiqi paid Ali to dilute, mix and apply the chemicals he supplied to the plant material. Izz delivered the drugs and collected payments for Tanous. Amira was the owner of Houston Beverage and a synthetic cannabinoids distributor. Ali received a sentence of 50 months, while Izz and Amira were each sentenced to 36 months.  

Muratalla, who worked for out of state manufacturers of synthetic cannabinoids here in Houston, and Taha, a clerk at Smoke Zone, who sold packages of synthetic cannabinoids were both sentenced to four-year-terms of probation.

Also sentenced this week were other distributors and managers involved in the distribution of synthetic cannabinoids in the Houston area. Those included Salem Fahed Tannous, 58, of Houston (Khader Tanous’s brother who collected money for him from synthetic narcotics sales), Ali Tafesh, 37, of Houston, who owned and distributed the drugs from a store named Azell Cell Phones, Hazim Hisham Qadus, 34, a permanent resident alien who resided in Houston and distributed drugs from a store named Moon Mart and Azell Cell Phones and Nagy Ali, 61 of Spring, the manager of Smoke Zone. Tannous was ordered to serve 49 months in prison, while Tafesh, Qadus will both serve sentences of 97 months. Nagy Ali received a 120-month-prison term for his role.

Throughout the three days of hearings and the handing down of these sentences, the court’s repeated theme was its concern that the dangerous drugs these defendants were manufacturing were being marketed and distributed to juveniles.

Siddiqi and Qadus are not U.S. Citizens and are expected to face deportation proceedings following the completion of their prison terms.

Omar Maher Alnasser, a 37-year old resident of Sugar Land and former University of Houston professor, was previously sentenced to 12 months and one day in prison for aiding and abetting an unlicensed money transmitting business.  He had admitted he was paid to wire more than $200,000 in U.S. currency from a bank in the United States to accounts in the country of Jordan.

The dismantling of this organizations and the convictions are the result of a multi-year, multi-agency federal investigation into one of the largest synthetic distribution networks in the nation and operated in the Houston area dubbed “We Can Hear You Now.” 

All 13 defendants sentenced this week were convicted of conspiring to distribute a variety of synthetic cannabinoids, all Schedule I controlled substances.  In committing the offense, several co-conspirators were accused in a scheme to defraud by marketing their products as though they were safe labeled the drugs as “potpourri” or “incense,” with some labels including false information such as “100% legal,” “lab certified” or “not for human consumption,” when in fact these products were dangerous drugs.

There are no standards for making synthetic cannabinoids which contain hazardous chemicals often imported from China that, when smoked or ingested, could have serious (sometimes deadly) side effects. Frequently, as in this case, various “brands” are mixed together in the same cement mixer, so two packets of a brand-named product may have the identical chemicals. Often, the same cement mixers are used for multiple batches of synthetic cannabinoids, so the “final” products may also be contaminated with other drugs or toxic chemicals from previous batches.

The amounts of synthetic cannabinoid in packages may also vary even within the same batches because the product is not mixed uniformly within the cement mixers. Therefore, “hot packages” with a higher concentration of the applied chemical are a common danger. According to the Center for Disease Control, synthetic cannabinoids may cause hallucinations, delusions, psychosis, suicidal thoughts and violent behavior.  The health problems associated with the drug include heart attack, stroke, kidney failure, breathing problems and muscle damage.

The drugs the defendants admitted to having distributed were all Schedule I drugs – substances or chemicals with no currently accepted medical use, have a high potential for abuse, are the most dangerous drugs of all scheduled drugs and have potential for severe psychological or physical dependence. The packaging was also typical of synthetic cannabinoids - contained colorful illustrations that targeted not only drug abusers, but also children and adolescents.

In connection with this case, authorities are still seeking Ziad Mahmoud Alsalameh, 56, of Pearland, and Aqil Khader, 33, of Houston. They are considered fugitives and warrants remain outstanding for their arrests. Anyone with information about their whereabouts are asked to contact DEA at 713-693-3000.

The Drug Enforcement Administration, Houston Police Department, Bureau of Alcohol, Tobacco, Firearms and Explosives and IRS – Criminal Investigation conducted the four-year investigation with the assistance of the U.S. Postal Inspection Service, Conroe Police Department, sheriff’s offices in Harris and Polk counties, Texas Alcoholic Beverage Commission and the Montgomery County District Attorney’s Office. Assistant U.S. Attorneys John Jocher and Nancy Herrera prosecuted the case.

BROWNSVILLE, Texas – A 36-year-old Brownsville resident has been ordered to federal prison following his conviction of conspiracy and methamphetamine smuggling, announced U.S. Attorney Ryan K. Patrick. A federal jury sitting in Brownsville convicted Jesus Yzaguirre Jr. March 12, 2018, following a six-day trial and less than three hours of deliberation.

Today, U.S. District Judge Rolando Olvera handed Yzaguirre Jr. a 200-month sentence to be immediately followed by five years of supervised release. In handing down the sentence, the court noted the evidence which the government had presented to the jury and Yzaguirre’s attempts to obstruct justice by trying to get others to conceal a van and not talk to investigating agents.

The jury heard that on Feb. 25, 2017, Yzaguirre drove into the United States through the Gateway Port of Entry in Brownsville. At primary inspection, Yzaguirre said he had gone into Mexico to “borrow the van” he was driving from his uncle. He was referred for secondary inspection, at which time he then said he had gone into Mexico to pick up the van which belonged to him. Agents searched the van and discovered 29.4 kilograms of methamphetamine hidden within the floorboard and frame compartments. 

Yzaguirre then gave a statement saying he thought he was bringing the van in for another person to use for alien smuggling. The person, a female friend whom he “bumped into in Matamoros,” asked him to pick up the van at a parking lot, according to his statement. She was to pay him $50 for taking it into the U.S. and parking it at a certain location. Yzaguirre said he had previously done the same thing with a different van which he parked somewhere in Brownsville.

Further investigation revealed Yzaguirre had in fact crossed a commercial van on three other occasions, each time going through the Sarita checkpoint. Agents interviewed an acquaintance of Yzaguirre who said Yzaguirre had admitted to knowing there were drugs in the van when he was arrested and that he had been working for “La Guera” who was in charge of the drug loads.

Yzaguirre was convicted of conspiracy to possess with intent to distribute 29.4 kilograms of methamphetamine, possession with intent to distribute the methamphetamine, conspiracy to import methamphetamine and importation of methamphetamine with intent to distribute

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

Immigration and Customs Enforcement’s Homeland Security Investigations conducted the investigation with the assistance of Customs and Border Protection. Assistant U.S. Attorneys Oscar Ponce and Angel Castro are prosecuting the case.

BROWNSVILLE, Texas – A 54-year old who had been illegally residing in Houston has been ordered to federal prison following her conviction of conspiracy to transport and harbor undocumented aliens and illegal re-entry after deportation, announced U.S. Attorney Ryan K. Patrick. Victoriano Zamora-Jasso aka “Tata,” pleaded guilty Jan. 29, 2018, on the eve of jury selection.

Today, U.S. District Judge Rolando Olvera handed Zamora-Jasso a 21-month sentence. Not a U.S. citizen, he is expected to face deportation proceedings following the sentence.

In early 2014, Zamora-Jasso began supplying aliens to Arnold Gracia, 48, from Harlingen. Gracia would then make arrangements with others to transport the aliens through the immigration checkpoint at Sarita. Gracia recruited Brandon Troy Robbins, 24, of San Antonio, Eric Alexander Rodriguez, 25, of Odem, Christopher David Wix, 24, of Abilene, and Yashira Perez-Morales, 28, from Watertown, New York – all then active duty soldiers stationed at Ft. Hood - to transport and deliver the aliens further north.

The conspiracy continued from approximately March to September of 2014. The soldiers would conceal the aliens under their military gear and made many successful trips during the course of the conspiracy. 

Zamora-Jasso was indicted in 2016 and arrested after a traffic stop in Conroe in July 2017. At the time of his plea, he admitted his involvement in the conspiracy and to being a previously convicted alien who returned after deportation in 2013.

Gracia and all the soldiers were previously sentenced in 2015 and 2016 with Gracia receiving a 73-month sentence while Robbins, Rodriguez, Wix and Perez-Morales received sentences of 20, 12 months, 12 months and a day and five years probation, respectively. 

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

Immigration and Customs Enforcement’s Homeland Security Investigation conducted the investigation with the assistance of Customs and Border Protection. Assistant U.S. Attorneys Oscar Ponce and Angel Castro are prosecuting the case. 

HOUSTON – The Southern District of Texas (SDTX) extends its appreciation to Attorney General (AG) Jeff Sessions for his leadership of the Department of Justice during his tenure as Attorney General. He was a prosecutor’s prosecutor and unwavering in his support of US Attorneys as well as state & local law enforcement across the country.

His leadership recommitted the Department to the rule of law, religious liberty, decreasing crime and attacking the opioid epidemic. By providing us with additional prosecutors, we continue to aggressively enforce our nation’s immigration laws and attack violent crime, thereby keeping our communities safe in the SDTX.

We sincerely thank AG Jeff Sessions for his dedicated service to our nation.

We will continue to effectuate the law enforcement priorities of President Donald J. Trump and look forward to working under the leadership of our next Attorney General.

HOUSTON – A man who had owned Stat Source Inc. has admitted he willfully failed to truthfully account for and pay over employment taxes to the IRS, announced U.S. Attorney Ryan K. Patrick.

Jonathan Adam Van Pelt withheld federal income taxes and Social Security and Medicare taxes from the wages of employees for one employment tax quarter. However, he did not timely file the required Employer’s Quarterly Federal Income Tax Return for that quarter reporting the withholdings and did not pay over the withholdings to the IRS.    

In the plea agreement filed in the record of the case, Van Pelt admitted the total employment taxes he failed to pay to the IRS for Stat Source Inc., was more than  $20 million, the amount owed for 18 employment tax quarters running from the third quarter of 2011 through the fourth quarter of 2015. Van Pelt admitted he spent the money owed on the unpaid employment taxes on various luxury items, such as luxury automobiles, expensive furniture, leather goods, jewelry, an expensive home, lavish vacations and various entertainment venues. 

He has agreed to pay $20 million in restitution to the IRS. 

U.S. District Judge Alfred H. Bennett accepted the plea today and has set sentencing for Jan. 17, 2019. At that time, Van Pelt faces up to five years in federal prison and a possible $250,000 fine. He was permitted to remain on bond pending that hearing.

IRS-Criminal Investigation conducted the investigation. Assistant U.S. Attorney Charles J. Escher is investigating the case.  

BROWNSVILLE, Texas – A 42-year-old Raymondville woman has been sentenced following her conviction of attempting to bring a minor alien into the United States, announced U.S. Attorney Ryan K. Patrick. Melissa Grimaldo pleaded guilty Aug. 7, 2018.  

Today, U.S. District Judge Rolando Olvera handed Grimaldo a 21-month sentence.  

A co-conspirator from Austin contacted Grimaldo via Facebook Messenger and hired her to smuggle a minor child into the United States from Mexico. Grimaldo used the Social Security card and identifying information of her own biological daughter to prepare the child to evade American authorities.   

On April 2, 2018, Grimaldo and her boyfriend, a self-registered sex-offender, crossed into Mexico, picked up the minor child from her family and attempted to enter the United States through the pedestrian lanes at the Gateway International Bridge in Brownsville. Grimaldo claimed the minor child was her own and presented her biological child’s Social Security card. She also told authorities she had submitted applications for U.S. Passports for both herself and the minor child, but they had not yet been processed.

Customs and Border Protection (CBP) officers questioned the minor child about the child’s school, teachers, grade level, age and birthday. The child  gave answers that were inconsistent with the identification Grimaldo provided. The minor child grew very nervous and began looking around the room and avoiding eye contact with the officers.

After further questioning, Grimaldo admitted the child was not hers or a U.S. citizen, admitting she was to be paid $2000 to transport the child into the United States. She also admitted the identifying documents were that of her own biological daughter who had been taken away by Child Protective Services. Grimaldo was to take the child to her home to further coordinate the smuggling conspiracy. 

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

CBP conducted the investigation. Assistant U.S. Attorney Holly D’Andrea prosecuted the case.

HOUSTON – A woman claiming to be a financial advisor and money manager has received that statutory maximum for defrauding former NBA players Travis Best and Dennis Rodman and NFL football players Ricky Williams and Lex Hilliard out of millions, announced U.S. Attorney Ryan K. Patrick. Peggy Ann Fulford, 60, formerly of Houston and New Orleans, pleaded guilty Feb. 1, 2018, to one count of interstate transportation of stolen property.

Today, U.S. District Judge Keith P. Ellison  handed Fulford a 120-month prison sentence to be immediately followed by three years of supervised release. She was further ordered to pay $5,794,870 in restitution to the victims.

At the hearing, the court heard from Kristin Williams, former wife of Heisman trophy winner Ricky Williams, and Rebekah Hilliard, wife of former NFL player Lex Hilliard, who detailed how Fulford’s theft had devastated them and their families financially. During the hearing, Judge Ellison asked Kristin Williams how much of Ricky Williams’ NFL money Fulford got, to which she replied “All of it.”

While on bond in this case and after pleading guilty, Fulford had used the name “Peggy Jones.” During the hearing today, a New Orleans-area man provided additional testimony describing how Fulford, whom he knew as Jones, recently swindled him out of $25,000 to invest in a bogus medical company in Arizona.

In handing down the sentence, the court overruled all defense objections and gave Fulford the statutory maximum sentence of 120 months.

Fulford has also been known to use several aliases, including Peggy King, Peggy Williams, Peggy Simpson, Peggy Rivers, Peggy Barard, Devon Cole and Devon Barard.

Fulford admitted she falsely told victims she was a Harvard-educated financial advisor and money manager. She offered to manage their expenses for them and use their money exclusively to pay their bills, including their income tax payments and/or to make retirement investments for them. Instead, Fulford diverted millions of victim funds that she laundered through dozens of bank accounts to pay for her own personal expenses.

Fulford falsely told victims she graduated from Harvard Law School and Harvard Business School and that she had made millions on Wall Street by buying and selling hospitals or on real estate in the Bahamas. She never requested a fee because she told the victims she already had millions of dollars and just wanted to protect them from losing their money.

However, she used most of their money, or intended to use most of their money, for her own personal purposes. Fulford communicated with victims in person, by phone and by email, inducing them to open or give her access to bank accounts which she raided and used for personal expenses such as luxury cars, real estate, jewelry and airline tickets.

In carrying out her scheme to defraud, Fulford moved victim funds back and forth between various bank accounts. As part of the plea, Fulford admitted she moved $200,000 in stolen funds from a bank account in Montana to a bank account in Texas. 

She 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. Attorney Belinda Beek is prosecuting the case.

HOUSTON - The owner of three Houston area clinics has been ordered to federal prison following her conviction of conspiracy to commit health care fraud, announced U.S. Attorney Ryan K. Patrick. Joy Aneke, 51, of Katy, entered her plea on May 16, 2018.

Today, U.S. District Judge Kenneth M. Hoyt handed Aneke a 36-month sentence to be immediately followed by three years of supervised release. Aneke was also ordered to pay $2,760,464.57 in restitution to the Medicare program. 

Aneke was the owner of Jadac Unique Health Services, Almeda Physicians Clinic and the home health agency Community Joyful Home Health in Harris and Fort Bend Counties. Aneke previously admitted to causing others to submit false and fraudulent claims to Medicare for medical services that were not provided and/or were not authorized by a physician. Specifically, the clinics billed for medical services that were not performed, including services such as allergy testing, complex cystometrograms and anal/urinary muscle studies. The clinics did not have the equipment to provide such services.     

As part of her plea, Aneke admitted she directed co-defendant Maureen Henshall, 62, of Highland, to falsify patient records at the clinic by adding tests and procedures that were not performed and/or were not medically necessary in order to increase the reimbursements that the clinics received from Medicare. Aneke instructed others to create false patient records, knowing the records would be used in support of claims billed to Medicare for tests and procedures which were not rendered, not medically necessary and not ordered by a licensed medical professional. Aneke also admitted she instructed Henshall to pay illegal kickbacks to patients to visit the clinics through others known as “recruiters” or marketers.”

Aneke previously admitted she employed Teodoro Seminario, 51, of Houston, who acted as the medical professional for the Jadac clinic, without any proper licensing. Seminario examined, assessed and/or treated patients without the assistance or supervision of any licensed medical professional. Seminario was not a licensed medical professional in the state of Texas. Aneke subsequently caused others to bill for the services Seminario provided as if he was a qualified, licensed medical professional. Seminario and Henshall were sentenced Oct. 29 to three years of supervised release and six months of home confinement for their roles in the scheme. 

Aneke and her three clinics billed approximately $5,963,675.88 for medical diagnostic services that were not provided and/or were not authorized by a physician. As a result of the false or fraudulent billings, Medicare paid approximately $2,760,646.57.    

Previously released on bond, Aneke 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 U.S. Department of Health and Human Services-Office of Inspector General and Immigration and Customs Enforcement’s Homeland Security Investigations conducted the investigation. Assistant U.S. Attorney Michael Day is prosecuting the case.

HOUSTON – A former U.S. Congressman was sentenced today to 120 months in prison and ordered to pay $1,014,718.51 in restitution, to be followed by three years of supervised release, for orchestrating a four-year scheme to defraud charitable donors of hundreds of thousands of dollars and secretly to funnel the proceeds to pay for personal expenses and to illegally finance his campaigns for public office.

U.S. Attorney Ryan K. Patrick, Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, Special Agent in Charge Matthew J. DeSarno of the FBI’s Washington Field Office’s Criminal Division and Special Agent in Charge D. Richard Goss of the IRS Criminal Investigation (CI) Houston Field Office made the announcement.

“At trial, the government proved to the jury that former congressman stockman ran his campaign and fraudulent charities to simply enrich himself and defrauded well-meaning donors,” said Patrick. “This type of corruption by public officials gives our entire democratic system a black eye.”

“Former Representative Stockman stole hundreds of thousands of dollars from charities, then used the money to pay personal expenses and fund his political campaigns,” said Benczkowski. “As this case demonstrates, the Justice Department and our law enforcement partners will aggressively pursue corrupt public officials, including those who seek to corrupt our elections for personal gain.”

Former U.S. Representative Stephen E. Stockman, 61, was convicted by a federal jury in Houston on April 12 of 23 counts of mail fraud, wire fraud, conspiracy to make conduit contributions and false statements to the Federal Election Commission (FEC), making false statements to the FEC, making excessive coordinated campaign contributions, money laundering and filing a false tax return. Two of Stockman’s former congressional staffers previously pleaded guilty in the case. Thomas Dodd, 39, of Houston, pleaded guilty March 20, 2017, to one count of conspiracy to commit mail and wire fraud and one count of conspiracy to make conduit contributions and false statements. Jason T. Posey, 48, of Tupelo, Mississippi, pleaded guilty Oct. 11, 2017, to one count of mail fraud, one count of wire fraud,and one count of money laundering.

“Former Congressman Stockman was entrusted by his constituents to serve in their best interest,” said DeSarno. “Instead, Stockman used his position in a series of schemes for personal gain at the expense of the public. Today’s sentence should send a clear message that the laws of the land apply to everyone, regardless of position or power. The FBI and our partners at the IRS will continue our efforts to identify fraudulent practices carried out by elected representatives. Public officials who abuse their position will be investigated, prosecuted, and subjected to the full punishment of the law for their actions.”

“Congressman Stockman used his position to defraud charitable foundations to advance his political career and pay for personal expenses,” said Goss. “His actions and failure to pay taxes on these illicit funds not only undermines the American tax system, but cultivates a lack of trust in our elected officials.  Today’s sentencing demonstrates IRS-CI’s commitment to bring justice to those public officials who believe they are above the law.”

According to the evidence presented at trial, from May 2010 to February 2014, Stockman and his co-defendants solicited $1,250,571.65 in donations from charitable organizations and the individuals who ran those organizations based on false pretenses, then used a series of sham nonprofit organizations and dozens of bank accounts to launder the money before it was used for a variety of personal and campaign expenses. 

Specifically, the evidence established that in 2010, Stockman and Dodd solicited an elderly donor in Baltimore, Maryland, for $285,000 to be used for legitimate charitable and educational purposes. Stockman and Dodd used a sham charity named the Ross Center to funnel the money to be used for a variety of personal expenses. The evidence further established that, in 2011 and 2012, Stockman and Dodd received an additional $165,000 in charitable donations from the Baltimore donor, much of which Stockman used illegally to finance his 2012 congressional campaign. 

The trial evidence also showed that shortly after Stockman took office as a Member of the U.S. House of Representatives in 2013, he and Dodd used the name of another sham nonprofit entity, Life Without Limits, to solicit and receive a $350,000 charitable donation, to be used to create an educational center called the Freedom House. Stockman, Dodd and Posey instead used this donation for a variety of personal and campaign expenses, including illegal conduit campaign contributions, a covert surveillance project targeting a perceived political opponent, an in-patient alcoholism treatment for a female associate and payments for hundreds of thousands of robocalls and mailings promoting Stockman’s candidacy for U.S. Senate in early 2014.

In addition, the evidence established that, in connection with Stockman’s Senate campaign, Stockman and Posey used another sham nonprofit entity to secure a $450,571.65 donation in order to fund a purportedly legitimate independent expenditure promoting Stockman’s candidacy. The evidence showed that the purportedly independent expenditure was in fact secretly controlled by Stockman who directed his campaign and Posey to file false affidavits with the FEC covering up Stockman’s involvement. 

Finally, the evidence at trial demonstrated Stockman failed to pay taxes on any of the $1,250,571.65 in fraudulently acquired donations. In addition, during the early stages of the investigation, Stockman directed Posey to flee to Cairo, Egypt, for two and a half years so that Posey could not be questioned by law enforcement.

The FBI and IRS-CI conducted the investigation. Assistant U.S. Attorney Melissa Annis and Trial Attorneys Ryan J. Ellersick and Robert J. Heberle of the Criminal Division’s Public Integrity Section are prosecuting the case. 

CORPUS CHRISTI, Texas – A 39-year-old Corpus Christi resident has been ordered to federal prison following his conviction of possessing with intent to distribute methamphetamine and illegally possessing a firearm and ammunition, announced U.S. Attorney Ryan K. Patrick. A federal jury convicted Juan Dedios Delagarza Aug. 14, 2018, following two days of trial and less than two hours of deliberation.

Today, U.S. District Judge Nelva Gonzales Ramos, who presided over the trial, handed Delagarza a 96-month sentence to be immediately followed by three years of supervised release.

During trial, jurors heard testimony that authorities executed a search warrant in the early morning hours of Sept. 28, 2013, at Delagarza’s Corpus Christi residence. He was there along with his five juvenile children and their mothers, among others.

Officers searched the residence and found more than 10 grams of methamphetamine, as well as numerous drug ledgers, scales, baggies, pipes and other drug paraphernalia. Also found was a loaded, stolen firearm and other ammunition. Officers and agents provided testimony about Delagarza’s prior felony conviction, the origin of the firearm and ammunition and the analysis of the narcotics recovered.

The jury also heard that Delagarza had previously admitted he knew of the methamphetamine.

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.

The Drug Enforcement Administration; Bureau of Alcohol, Tobacco, Firearms and Explosives; Texas Department of Public Safety; Nueces County Sheriff’s Office; and Corpus Christi Police Department all assisted in the joint investigation. Assistant U.S. Attorney Michael Hess is prosecuting the case.

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. Attorney General Jeff Sessions reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.

McALLEN, Texas – A 32-year-old Donna man has been sentenced in federal court for being a felon unlawfully in possession of a firearm, announced U.S. Attorney Ryan K. Patrick. Joaquin Ramos De La Cruz pleaded guilty Sept. 1, 2017.

Today, U.S. District Judge Randy Crane handed De La Cruz a sentence of 204 months in federal prison to be immediately followed by three years of supervised release. De La Cruz had previously been convicted for numerous criminal offenses, including aggravated robbery, aggravated assault and attempted murder. The court found him to be an armed career criminal. In handing down the sentence, Judge Crane considered De La Cruz’s disregard for human life displayed in his prior criminal conduct in which he discharged firearms at multiple individuals in separate criminal episodes. The court also considered several jail calls the defendant made in which he threatened others with death while awaiting sentencing.

On Jan. 17, 2017, the U.S. Marshals Service (USMS) and the Law Enforcement Emergency Regional Response Team (LEERT) attempted to execute an arrest warrant for De La Cruz at a residence in Donna. While authorities entered the residence, De La Cruz discharged multiple rounds from a Ruger, Model P95, 9mm pistol in an attempt to exit through a locked rear door to the residence. De La Cruz eventually exited, but was promptly apprehended. Agents recovered the Ruger 9mm pistol at the scene.

As a convicted felon, he is prohibited by federal law of possessing any firearm or ammunition.

In federal custody since his arrest, De La Cruz 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 USMS and LEERT. Assistant U.S. Attorney Roberto Lopez Jr. prosecuted the case.

VICTORIA, Texas – A 48-year-old Victoria man has been ordered to federal prison following his convictions on 10 counts of wire fraud, announced U.S. Attorney Ryan K. Patrick. Murray Wade Carson pleaded guilty July 2, 2018.

Today, Senior U.S. District Judge John Rainey handed Carson a 27-month sentence to be immediately followed by three years of supervised release. At the hearing, additional testimony was provided that described how Carson used sophisticated means to cimmit is fraud. In handing down the sentence, the court noted that it was incredible that the crime went on for eight years until an auditor figured it out. “That was the only thing that stopped you,” said Rainey. 

At the time of his plea, Carson admitted he devised a scheme to defraud his employer by charging his employer for the purchase non-existent goods and products from the Kirby Taylor Company (KTC). Carson had set up KTC and concealed that information from his employer.

Carson admitted he submitted invoices from KTC for nonexistent goods, which he purchased using his employer issued credit card. He then used his home computer to submit charges for these nonexistent goods.

The scheme lasted from approximately 2007 through June 2015.  

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

HOUSTON - Two former commodities traders of a New York, New York-based financial services firm have pleaded guilty for their participation in a $60 million commodities fraud and spoofing conspiracy that was perpetrated through the U.S. commodities markets. One of the traders also pleaded guilty for his participation in a second commodities fraud and spoofing conspiracy at another financial services firm based in Chicago, Illinois.

U.S. Attorney Ryan K. Patrick, Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and Special Agent in Charge Jeffrey S. Sallet of the FBI’s Chicago Field Office made the announcement.

Krishna Mohan, 33, of New York, pleaded guilty today to one count of conspiracy to engage in wire fraud, commodities fraud and spoofing. Sentencing is scheduled for Feb. 28, 2019, before U.S. District Judge Gray H. Miller of the Southern District of Texas (SDTX).

Kamaldeep Gandhi, 36, of Chicago, pleaded guilty Nov. 2 to two counts of conspiracy to engage in wire fraud, commodities fraud and spoofing. Sentencing is scheduled for Feb. 22, 2019, before U.S. District Judge Ewing Werlein Jr. of the SDTX.

As part of their pleas, Gandhi and Mohan admitted that from March 2012 to March 2014, they conspired with Yuchun “Bruce” Mao and others at the first firm (Trading Firm A) to mislead the markets for E-Mini S&P 500 and E‑Mini NASDAQ 100 futures contracts traded on the Chicago Mercantile Exchange (CME) and E-Mini Dow futures contracts traded on the Chicago Board of Trade (CBOT). Gandhi and Mohan further admitted they and their co-conspirators placed thousands of orders that they did not intend to execute, or “spoof orders,” in order to obtain executions of other orders, or “primary orders,” at better prices, quantities and/or times than otherwise possible to the benefit of the co-conspirators and Trading Firm A. Gandhi and Mohan further admitted the United States has calculated that the scheme resulted in market losses of more than $60 million.

Also, as part of Gandhi’s plea, he further admitted that from May 2014 through October 2014, while employed at the second firm (Trading Firm B), he conspired with others to mislead the markets for E‑Mini S&P 500 futures contracts traded on the CME by agreeing to place, and himself placing, hundreds of spoof orders for E-Mini S&P 500 futures contracts in order to create the false and misleading appearance of increased supply or demand. Gandhi further admitted the United States has calculated that the scheme resulted in market losses of more than $1.3 million.

The FBI’s Chicago Field Office is conducting the investigation. SDTX Assistant U.S. Attorney John Lewis and Trial Attorneys Mark Cipolletti, Jeffery Le Riche and Matthew Sullivan of the Criminal Division’s Fraud Section are prosecuting the case. The Commodity Futures Trading Commission’s Division of Enforcement provided substantial assistance and referred this matter to the Department. 

Individuals who believe that they may be a victim in these cases should visit the Fraud Section’s Victim Witness website for more information.

CORPUS CHRISTI, Texas - A 41-year-old resident of Los Fresnos has been convicted of transporting illegal aliens, announced U.S. Attorney Ryan K. Patrick. The jury deliberated for less than an hour before convicting Dianna Garza of conspiracy to transport illegal aliens and two counts of transporting illegal aliens following a two-day trial.

During the trial, the jury heard testimony that on Aug. 22, 2018, U.S. Border Patrol (BP) agents observed a vehicle parked on the side of Highway 77 just north of the Sarita Border Patrol checkpoint. The agents then observed multiple subjects running out of the brush towards the parked vehicle. After the vehicle started moving, agents conducted a traffic stop, at which time two undocumented aliens fled but were apprehended in the brush. The aliens admitted to paying smugglers to avoid detection while traveling from Matamoros, Mexico, to Houston.

U.S. District Judge Nelva Gonzales Ramos presided over the trial and set sentencing for Jan. 30, 2019. At that time, Garza faces up to 10 years imprisonment and a possible $250,000 fine.

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

Customs and Border Protection conducted the investigation with the assistance of the U.S. Marshals Service. Assistant U.S. Attorneys Michael Hess and Reid Manning are prosecuting the case.

HOUSTON – A former procurement officer of Venezuela’s state-owned and state-controlled energy company, Petroleos de Venezuela S.A. (PDVSA), pleaded guilty today for his role in an international money laundering scheme involving bribes paid by the owners of U.S.-based companies to Venezeulan government officials in exchange for securing additional business with PDVSA and payment priority on outstanding invoices.

U.S. Attorney Ryan K. Patrick, Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and Special Agent in Charge Mark Dawson of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations’ (HSI) Houston Field Office made the announcement.

Ivan Alexis Guedez, 47, of Katy, pleaded guilty before U.S. Magistrate Judge Christina A. Bryan to one count of conspiracy to launder money. Sentencing has been set for Feb. 20, 2019, before U.S. District Judge Gray H. Miller.

According to admissions made in connection with his, Guedez agreed with other PDVSA officials and businessmen who were employed by a Miami-based PDVSA supplier that, in exchange for bribe payments, Guedez and the other PDVSA officials would direct PDVSA business toward the supplier. The co-conspirators who were employed by the PDVSA supplier also received kickbacks. Guedez and his co-conspirators concealed the corrupt payments by, among other things, communicating using fictitious email addresses, creating false invoices to justify the payments and directing the bribe payments to a Swiss account in the name of a shell company before being disbursed to the co-conspirators.

As part of his plea agreement, Guedez has agreed to forfeit the proceeds of his criminal activity.

Guedez becomes the latest individual to plead guilty as part of a larger, ongoing U.S. government investigation into bribery at PDVSA. Including Guedez, the Justice Department has announced the guilty pleas of a total of 15 individuals in connection with the investigation.

HSI Houston is conducting the ongoing investigation with assistance from HSI Boston and Madrid, as well as from IRS -Criminal Investigation. Assistant U.S. Attorneys (AUSA) John Pearson and Robert S. Johnson, Trial Attorneys Jeremy R. Sanders, Sarah E. Edwards and Sonali Patel of the Criminal Division’s Fraud Section are prosecuting the case. AUSA Kristine Rollinson is handling the forfeiture aspects of the case.

The Criminal Division’s Office of International Affairs and the Cayman Islands Mutual Legal Assistance Authority and Office of the Director of Public Prosecution also provided assistance. 

The Fraud Section is responsible for investigating and prosecuting all FCPA matters. Additional information about the Justice Department’s FCPA enforcement efforts can be found at www.justice.gov/criminal/fraud/fcpa.

HOUSTON – A 26-year-old man has been ordered to federal prison following his conviction for unlawfully possessing firearms, announced U.S. Attorney Ryan K. Patrick. Fabian Spotts pleaded guilty in June 2018 to three counts of being a felon in possession of a firearm.

Today, U.S. District Judge Kenneth M. Hoyt handed Spotts an 84-month sentence followed by three years of supervised release.

At the hearing, the court saw screen shots of posts from Spotts’ Twitter account depicting him posing with various firearms and offering drugs for sale. Judge Hoyt noted the online images were out there for the world to see and could not be taken back.

The government also described Spotts’ extensive criminal history involving weapons and that, at the time of his arrest on these charges, he as found in possession of of a fully loaded Glock pistol, marijuana and pills and nearly $2,500 in cash.

Agents with the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) learned Spotts was selling stolen firearms utilizing his Twitter account. Following discussions, an undercover ATF agent and confidential informant met with Spotts on three separate occasions in November and December 2017 and conducted controlled purchases from Spotts of semi-automatic rifles, magazines, ammunition, sights and body armor. The transactions took place at the Palms Apartments on the 6400 block of Westheimer in Houston.

Spotts supplied two Anderson Manufacturer, model AM-15, 5.56 caliber semi-automatic rifles with sights, a Mega Machine Shop Inc., model MATEN, 5.56 caliber AR-10 style semi-automatic rifle, a Southern Arms and MFG LLC, Model SAF-15, 5.56 caliber semi-automatic rifle, various magazines loaded with ammunition including a 100-round 5.56 caliber fully-loaded drum magazine as well as a bullet proof vest. 

Previously convicted of robbery, a felony offense, he is prohibited from possessing firearms or ammunition.

The ATF, Houston Police Department and task force officers from the North Division Crime Suppression Team conducted the investigation.Assistant U.S. Attorney Carrie Wirsing prosecuted the case which was brought as part of the Department of Justice’s Project Safe Neighborhoods (PSN), a nationwide program to reduce gun and gang crime in America and the Houston Law Enforcement Violent Crime Initiative which seeks to proactively fight violent crime across the Greater Houston area

HOUSTON – A 54-year-old resident of Kingwood and Panama City, Panama, has been ordered to federal prison for mail fraud and ordered to pay more than $8 million in restitution, announced U.S. Attorney Ryan K. Patrick. Steven Patrick Jones pleaded guilty May 1, 2014.

Today, U.S. District Judge Gray Miller, who accepted the guilty plea, handed Jones a total sentence of 85 months in federal prison. He was further ordered to pay restitution to victims in the amount of $8.2 million.

Jones has admitted he and his partner - John Patrick Acord, 75, of Magnolia - formed a company called Intermodal Wealth (IW) to sell shipping containers. Dean Lester Springer Sr., 58, of Hillsboro, Oregon, worked as a salesman for IW from May to November 2012.

Intermodal offered to sell the containers to investors, then lease the containers for them. Jones promised to pay their investors 16% per year from the proceeds of the leases. However, the company had few containers and did not lease any of them. Payments were made to investors, but the funds came from subsequent investors rather than from true proceeds.

The Texas State Securities Board issued an emergency cease and desist order against IW from offering securities in Texas on July 20, 2012, claiming the company was engaged in fraud and that their acts threatened immediate and irreparable harm to the public. They also included information about their criminal histories.

As a result of the publicity following the order, Springer formed World Container (WC) on Nov. 30, 2012, offering to sell securities to investors. Specifically, he promised to use investor funds to purchase shipping containers for the investors and make money for them by leasing the containers as he had done as a salesman for IW.

He told Investors that WC was independent of IW and its associated companies. However, Springer sent the contracts, investments and money received from WC investors to Jones and IW in Panama. Springer did not purchase or lease containers for investors as promised. Many WC investors were not told IW was receiving their funds, nor about the criminal records, extensive civil judgments, tax liens or Securities and Exchange Commission injunctions against Jones and Acord. Springer also failed to reveal to investors that he received a commission from investments from Jones and Acord.

Through WC, Springer recruited new investors using a business model very similar to IW. WC received $3,927,189.28 from investors and paid $728,886.38 in returns. Investors lost $3,198,302.90 as a result of the scheme. 

Intermodal received more than $5.5 million from investors throughout the United States and worldwide. Jones, his family and partners spent the majority of the investment funds they received.

Acord and Springer also pleaded guilty and were later sent to prison.

Jones 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 U.S. Postal Inspection Service conducted the investigation with the assistance of the Texas State Securities Board. Assistant U.S. Attorney Jay Hileman is prosecuting the case.

HOUSTON – Two people have been charged with conspiracy to commit mail fraud and mail fraud for their participation in a scheme to defraud Dr. Pepper Snapple Group Inc. (DPSG), announced U.S. Attorney Ryan K. Patrick.

Authorities took Joseph A. Isaac, 52, of Houston, into custody today, He is expected to make his initial appearance before U.S. Magistrate Judge Nancy Johnson at 2:00 p.m. Co-defendant Anna Maria Sites, 41, of Friendswood, is expected to make her initial appearance in the near future.

The indictment, returned under seal Oct. 17 and unsealed today, alleges Isaac and Sites defrauded DPSG from 2010 through Feb. 17, 2015. The pair worked at FulFill Plus Inc., a company which  administered rebate campaigns for DPSG, according to the charges.

DPSG paid money to Fulfill Plus to fund rebates for those who had requested them. However, the rebates were not paid, according to the indictment. Isaac and Sites allegedly used the money not paid out in rebates for their own personal expenses and non-rebate related expenses of FulFill Plus. 

​Conspiracy to commit mail fraud carries a maximum penalty of five years imprisonment, upon conviction. Each also faces up to 20 years for each count of mail fraud. Both charges also carry a potential $250,000 maximum fine.

​The FBI investigated. Assistant U.S. Attorney John Braddock 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 former Webb County Commissioner and a former city councilman have entered guilty pleas to conspiracy to commit federal program bribery, First Assistant U.S. Attorney Tim Braley announced today along with FBI Special Agent in Charge Christopher Combs.

Former Webb County Commissioner Jaime Alberto Canales, 51, and John “Johnny” Amaya, 70, owner of JAUC Services Inc. and a former Laredo City Councilman, pleaded guilty in Houston federal court today. Both reside in Laredo.

Canales admitted at least in or about January 2015 through in or about January 2017, an individual gave and agreed to give things of value in order to influence and reward him for his official acts as a Webb County commissioner and Laredo Metropolitan Planning Organization (MPO) representative. Canales accepted these things of value, intending to be influenced and rewarded for his official assistance. These things of value, which included checks disguised as campaign contributions and personal loans, use of a co-conspirator Padre Island condominium and meals and entertainment, were provided in connection with business and transactions of Webb County and the Laredo MPO well in excess of $5,000.

Amaya owned and controlled JAUC Service Inc. A co-conspirator employed Amaya as a consultant for Corporation A, as listed in the indictment, from in or about January 2011 through in or about April 2017. In this role, Amaya met and spoke with various Webb County and City of Laredo officials to direct them to take actions that benefitted the co-conspirator and corporation. Amaya maintained close contact with officials who could help the conspirator and corporation by setting up meetings and passing messages to and from the conspirator. Amaya admitted  he acted as a middleman between the conspirator and public officials. At the conspirator direction, Amaya provided cash payments, personal checks disguised as campaign contributions and meals and entertainment to these officials, including Canales.

All of the payments were reimbursed with the corporation’s corporate funds, either directly or indirectly. At the conspirator direction, Amaya also supported specific candidates in the November 2016 election cycle by providing rental cars, drivers and gas cards for those rental vehicles to transport voters to the polls, all for which the corporation paid.

U.S. District Judge Sim Lake accepted the pleas today and has set sentencing for Feb. 14, 2019. At that time, Canales and Amaya face up to five years in federal prison. They were permitted to remain on bond pending that hearing. 

The FBI conducted the investigation. Assistant U.S. Attorneys Carolyn Ferko and John Pearson are prosecuting the case.

HOUSTON - The 26-year-old man convicted of burning the Victoria Islamic Center in January 2017 has been ordered to federal prison for more than 24 years. 

U.S. Attorney Ryan Patrick for the Southern District of Texas, Acting Assistant Attorney General John Gore of the Justice Department’s Civil Rights Division, Special Agent in Charge Fred Milanowski of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and Special Agent in Charge Perrye K. Turner of the FBI made the announcement.

A federal jury in Victoria returned guilty verdicts July 16, 2018, on all counts as charged against Marq Vincent Perez. They found him responsible for a hate crime in the burning of the Jan. 28, 2017, and for use of a fire to commit a felony. In addition, they found he possessed an unregistered destructive device for an incident that occurred on Jan. 15, 2017.

Today, Senior U.S. District Judge John Rainey noted the seriousness of the offense before imposing a 294-month-term of imprisonment. In handing down the sentence, the court noted that the most important factor in determining punishment was adequate deterrence, stating that “this conduct would not be tolerated in our society.”

Judge Rainey also commented on hate crimes and how they are “a cancer to our society” and that “this must stop.” The Judge also noted that Perez wanted to send a message to the Muslim community, but the court was also sending a message to Perez and others like him.

At the hearing, three members of the mosque also provided testimony detailing the impact the crime has had on them, their families and the community. They noted that people are still  frightened to this day, noting that some of the female members do not even wear the traditional head coverings in public. Some members cannot even bring themselves to return because of their fears.

“The Attorney General has said that the Freedom of religion is indeed our ‘first freedom’—being the first listed right of our First Amendment,” said Patrick. “The Department of Justice prosecutes violent and dangerous crime, but also, and particularly when that crime interferes with someone’s ability to practice their religious faith. Not only was this a dangerous and potentially deadly act, but also one spurred from hate. I am glad justice was served in this case.”

“Everyone in this country has the right to worship freely without fear of violence,” said Gore. “This defendant terrorized the Muslim community in Victoria, and the Department partnered with federal, state and local agencies to ensure that the person responsible for this heinous hate crime would be found and prosecuted.”

“ATF is the primary federal law enforcement agency tasked with investigating House of Worship Fires and views an arson against a house of worship as not just an attack on a building, but as an attack against an entire community,” said Milanowski. “ATF is pleased the defendant has been held accountable for this crime and will continue to respond to these violent crimes using all available resources.”

“Mr. Perez sought to provoke terror within the tranquil space of the Victoria Islamic Center," said FBI Assistant Special Agent-in-Charge Edward Michel. "By deliberately burning down this mosque, Mr. Perez attacked a specific religious congregation in the hope of spreading fear, conflict and depriving Victoria’s Islamic community of their peaceful and safe place to worship. Today's sentencing illustrates that hate crimes will not be tolerated. No one in this country should feel afraid to openly practice their religion or express their beliefs. The FBI will continue to aggressively investigate civil rights violations wherever and whenever they occur."

At the time of the trial, the jury heard that the case was “a simple, straightforward case of hate.”

Testimony at trial detailed how Perez conducted what he described as “recon” by breaking into the mosque a week before he set it on fire. Evidence presented at trial showed Perez communicated with someone through Facebook about breaking into the mosque a second time, the same night of the fire. A witness who was with Perez on the night of the fire described how Perez used a lighter to set papers on fire inside the mosque and how excited Perez was upon seeing the mosque in flames just minutes later.

The witness testified that Perez said that he burned down the mosque, because he wanted to “send a message.”

During the execution of a search warrant, federal agents recovered stolen property taken from the mosque the night of the fire in Perez’s home. Several witnesses at trial also testified about Perez’s animus towards Muslims and that he often used anti-Muslim slurs.

Members of the mosque testified at the trial that they watched from afar as federal, state and local law enforcement officers tried to extinguish the fire, but observed that the fire could not be put out until it had engulfed the entire mosque. Those witnesses also testified that, after the destruction of the mosque, the Victoria Islamic Center raised money online from over 20,000 individuals from all over the United States and more than 90 countries to rebuild the mosque. 

When Perez learned that the Victoria Muslim community had raised money to rebuild the mosque, he told a witness that he would burn the mosque down again if it was rebuilt.

ATF and FBI conducted the investigation along with the City of Victoria Fire Marshal’s Office, Victoria Fire Department, Victoria Police Department, Texas Department of Public Safety - Criminal Investigations Division and Texas Rangers with assistance of Texas State Fire Marshal’s Office and Sheriff’s Offices in Victoria and Nueces Counties and the Victoria County District Attorney’s Office.

The City of Victoria has also acknowledged the efforts in this case, noting “The Victoria Fire Department and the City of Victoria would like to extend our gratitude and appreciation to all of our local state and federal partners. We also want to thank all of the local businesses and organizations that have supported the investigation team. This has been a long process, 21 months. We want to thank the community for their patience and support.”

Assistant U.S. Attorneys Sharad S. Khandelwal and Kate Suh prosecuted the case along with Trial Attorney Saeed Mody of the Department of Justice’s Civil Rights Division