Southern District of Texas

HOUSTON - Three former commodities traders of a New York-based financial services firm (Trading Firm A) were charged yesterday for their alleged participation in an over $60 million commodities fraud and spoofing conspiracy that was perpetrated through the U.S. commodities markets. Two of these traders have agreed to plead guilty for their respective roles in the criminal conspiracy.   

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.

Yuchun “Bruce” Mao, 39, a citizen of the People’s Republic of China, was indicted on one count of conspiracy to commit commodities fraud, two counts of commodities fraud and two counts of spoofing. Kamaldeep Gandhi, 36, of Chicago, was charged by criminal information with two counts of conspiracy to engage in wire fraud, commodities fraud and spoofing. Krishna Mohan, 33, of New York, New York, was charged by criminal information with one count of conspiracy to engage in wire fraud, commodities fraud and spoofing. 

“The Southern District of Texas aggressively prosecutes white collar crime,” said Patrick. “Home to the second most Fortune 500 companies in the nation, our Houston division is uniquely suited to prosecute white collar fraud in whatever form it comes, and we enjoy terrific relationships with law enforcement partners around the country and from around the world.”

“As alleged in today’s charges, these individuals engaged in a sophisticated scheme to distort the futures market for their own advantage by placing large ‘spoofed’ trading orders that they never intended to execute,” said Benczkowski.  “Investor trust is the cornerstone of our trading markets, and the Criminal Division will aggressively investigate and prosecute those who undermine that trust by engaging in spoofing or any other illegal conduct.”

“These charges demonstrate the FBI’s firm commitment to hold accountable those who seek to deceive and defraud the public,” said Sallet. “Such schemes cannot be allowed to threaten confidence in the free market, which represents one of many strengths of our great nation. We will continue to work together to aggressively pursue anyone who undermines the integrity of our financial markets and disregards the rule of law.”

The indictment alleges Mao was co-head of a trading team that traded commodities on behalf of Trading Firm A, working in Chicago and New York.  The indictment alleges that from in or around March 2012 through in or around March 2014, Mao and others conspired 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). The indictment further alleges Mao and his co-conspirators deceived market participants and manipulated markets by placing thousands of orders that they did not intend to execute, or “spoof orders,” in order to create the false and misleading appearance of increased supply or demand. Market participants that traded futures contracts in these three markets while the spoof orders distorted market prices incurred market losses of over $60 million. Mao and his co-conspirators are alleged to have placed these spoof orders in order to benefit themselves Trading Firm A.

Count one of the criminal information alleges Gandhi conspired, with Mao and others, to commit the underlying offenses while employed at Trading Firm A.  Count two of the criminal information alleges that, from in or around May 2014 through in or around October 2014, Gandhi, while employed at a second Chicago-based trading firm (Trading Firm B), 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, 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 has agreed to plead guilty to the charges in the criminal information.

The charges against Mohan arise from his participation in the conspiracy alleged above while employed at Trading Firm A. Mohan has agreed to plead guilty to the charge in the criminal information.

The FBI’s Chicago Field Office is investigating the case. 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 CFTC’s Division of Enforcement provided substantial assistance in this case.

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

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

HOUSTON – A 60-year-old resident of Bellaire made his initial appearance on a 13-count indictment charging him with wire fraud, mail fraud and money laundering, announced U.S. Attorney Ryan K. Patrick.  

William Andrew Hightower surrendered to federal authorities yesterday.  

He was president of Hightower Capital Group (HCG) which he founded it in 2010. There, he held himself out to be an investment advisor.   

The 13-count indictment alleges Hightower took money from clients from 2013-2018 and made false promises as to their investments. In reality, according to the charges, he was conducting a Ponzi Scheme. 

Hightower would allegedly tell investors their money was being invested in various projects, such as restaurants, movies, insurance contracts, among other things. The indictment alleges Hightower received more than $10 million from investors, many of whom believed Hightower was investing their money in legitimate projects. According to the allegations, Hightower used investor funds to pay earlier investors in a Ponzi Scheme, pay himself and fund his lifestyle. 

Hightower also concealed from his clients that the Financial Industry Regulatory Authority (FINRA) had barred him from acting as a broker or otherwise associating with a broker-deal firm in October 2015, according to the indictment.  

If convicted, he faces up to 20 years in federal prison for each count as well as a thousands of dollars in possible fines.  

The FBI conducted the investigation. Assistant U.S. Attorney Suzanne Elmilady is prosecuting the case.

 

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

HOUSTON – A Mexican national has entered a guilty plea to conspiring to possess with intent to distribute heroin, announced U.S. Attorney Ryan K. Patrick.

Victor Manuel Morales-Moreno, 35, admitted to conspiring to distribute heroin to street level dealers and users for more than two years.

According to court records, Morales relocated to Houston from California to take over a heroin trafficking ring following the arrests and incarceration of his relatives Jose Herrera-Alvarado and Pedro Herrera-Alvarado. The Herrera-Alvarado brothers pleaded guilty to conspiracy to possess with intent to distribute heroin and later sentenced to life in federal prison.

Erasto Aguirre-Suarez, 52, a Mexican national, also pleaded guilty today to conspiracy to possess with intent to distribute heroin. He admitted he moved to Texas with Morales-Moreno to assist him in the daily operations of the heroin business. A third co-defendant, Valentin Anthony Cardenas, 35, of Houston, previously entered his plea possession with intent to distribute heroin.

Sentencing is scheduled for Feb. 5, 2019 before U.S. District Judge Andrew S. Hanen. At that time, Morales-Moreno face a minimum of 10 years and up to life imprisonment as well as a possible $10 million maximum fine.

They have been and will remain in custody pending that hearing.

The FBI and Drug Enforcement Administration conducted the investigation. Assistant U.S. Attorney Casey N. MacDonald is prosecuting the case.

McALLEN, Texas ‐ A former lieutenant with the Edcouch Police Department (EPD) has been ordered to federal prison for drug trafficking, announced U.S. Attorney Ryan K. Patrick. Vicente Salinas, 43, of Elsa, pleaded guilty Dec. 5, 2016, to conspiracy to possess with intent to distribute more than 500 grams of cocaine.  

Today, U.S. District Judge Ricardo H. Hinojosa ordered Salinas to serve 39 months in prison. In imposing the sentence, the court ruled Salinas abused his position of trust to facilitate the drug trafficking offense. Judge Hinojosa further noted that when police officers commit crimes, it effects the community more than just the impact of that one offense - it erodes the trust the community has with law enforcement. Salinas will also serve two years of supervised release.

On March 18, 2013, Salinas received information which led to the seizure of 15 bundles of cocaine. The drugs were stored at EPD for several days, but then transported to the Hidalgo County High Intensity Drug Trafficking Area Task Force. Upon initial inspection, officers discovered four of the bundles contained blocks of wood.

Salinas admitted he had participated in the theft. He confessed he was part of a scheme to steal the bundles shortly after officers initially logged the 15 bundles into evidence. They were replaced with bundles containing the wood blocks so that no one would detect the theft.

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

Immigration and Customs Enforcement’s Homeland Security Investigations, Drug Enforcement Administration and IRS - Criminal Investigation conducted the Organized Crime Drug Enforcement Task Force Investigation which was dubbed Operation Blue Shame. Assistant U.S. Attorneys Anibal J. Alaniz and Kristen Rees prosecuted the case. 

HOUSTON – Two Houston men have been ordered to federal prison for their convictions related to a string of Cash America Pawn robberies, announced U.S. Attorney Ryan K. Patrick. Patrick Earl Cooper Jr., 20, pleaded guilty July 2, 2018, while Joe Gutierrez entered his plea the month prior.

Today, U.S. District Judge Lynn Hughes handed Cooper a sentence of 108 months for his involvement in two armed robberies in addition to another seven years for using a firearm during a robbery. The total 16-year sentence will be followed by two years of supervised release. Gutierrez received 76 months for using a knife to rob a Cash America Pawn store on Oct. 31, 2017. He will also serve two years of supervised release.  

Cooper was sentenced for two specific robberies at Cash America Pawn stores, during which the defendants stole firearms, cash and jewelry. Specifically, in October 2017, Cooper joined with Derrick Stewart to rob the Cash America Pawn at 8223 North Freeway at gunpoint. Cooper, Stewart and Gutierrez were finally captured and arrested Oct. 31, 2017, after robbing the Cash America Pawn at 1816 North Durham Street at knifepoint.

In imposing the sentence, the court found Cooper lacked remorse for his crimes and had not accepted responsibility when he assaulted a fellow inmate while pending sentencing.  

Stewart, 20, of Houston, pleaded guilty to two robberies and using a firearm during a crime of violence and is scheduled to be sentenced Dec. 10, 2018.

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.

The Bureau of Alcohol, Tobacco, Firearms and Explosives, Houston Police Department and the Harris County Precinct One Constable’s Office assisted with the Cash America Pawn robbery investigations. Assistant U.S. Attorneys Heather Winter and Richard Hanes are prosecuting the case.

A former CEO and former executive of an oil services company were sentenced to prison today for their involvement in an international bribery conspiracy. 

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Ryan K. Patrick of the Southern District of Texas 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.

Anthony “Tony” Mace, 66, of the United Kingdom, the former CEO of SBM Offshore, N.V. (SBM), a Dutch oil services company, and a former Board Member of SBM’s U.S.-based subsidiary, SBM Offshore USA Inc. (SBM USA), was sentenced to serve 36 months in prison and a fine of $150,000.  Robert Zubiate, 66, of Agoura Hills, California, a former sales and marketing executive at SBM USA, was sentenced to serve 30 months in prison and a fine of $50,000.

“Anthony Mace and Robert Zubiate played key roles in a massive bribery scheme that involved the payment of millions of dollars to public officials in exchange for lucrative oil-services contracts,” said Assistant Attorney General Benczkowski.  “Their actions rewarded corrupt officials’ greed and tilted the playing field against honest, law-abiding companies.  Today they paid a heavy price for their crimes.  Their sentences should serve as a warning to corporate executives everywhere: if you pay bribes to advance your business interests, we will catch you and we will prosecute you to the fullest extent of the law.”

“Pursuing corrupt companies and individuals who misuse our financial system to commit FCPA violations represents our commitment to keeping the integrity of American democracy in place both here and abroad,” said U.S. Attorney Patrick.  “We will continue to prosecute such cases involving wrongdoing for corporate crimes and greed.”

“This case is a prime example of Homeland Security Investigations’ enduring commitment to work closely with our foreign law enforcement partners to track down those who seek to gain an unfair competitive advantage in the international marketplace,” said HSI Special Agent in Charge Dawson. “By working together to hold these individuals accountable for their actions, we have taken a significant step to level the playing field for companies and consumers.”

In November 2017, Mace and Zubiate each pleaded guilty to one count of conspiracy to violate the Foreign Corrupt Practices Act (FCPA) in connection with a scheme to bribe foreign government officials in Brazil, Angola and Equatorial Guinea. 

According to admissions made in connection with his plea agreement, Mace acknowledged that prior to his becoming CEO, other employees of SBM entered into an agreement to pay bribes to foreign officials including at Brazil’s state-controlled oil company, Petróleo Brasileiro S.A. (Petrobras); Angola’s state-owned oil company, Sociedade Nacional de Combustíveis de Angola, E.P. (Sonangol); and Equatorial Guinea’s state-owned oil company, Petroléos de Guinea Ecuatorial (GEPetrol).  Mace admitted that he joined the conspiracy by authorizing payments in furtherance of the bribery scheme and deliberately avoided learning that those payments were bribes. 

In particular, Mace maintained a spreadsheet reflecting payments to five individuals.  Mace acknowledged that even though he was aware there was a high risk those individuals were Equatorial Guinean officials, he nevertheless authorized SBM to make over $16 million in payments to those individuals.  Mace further continued a practice that was instituted before he became CEO by splitting payments to SBM’s Brazilian intermediary, that is, paying a portion of the intermediary’s commission to an account in Brazil and another portion of the agent’s commission to accounts in Switzerland held in the name of shell companies.  Mace deliberately avoided learning that the ultimate recipients of the payments that he authorized to the shell companies were Petrobras officials, he admitted.

According to admissions made in connection with Zubiate’s plea, from between 1996 and 2012, Zubiate and others used a third-party sales agent to pay bribes to foreign officials at Petrobras in exchange for those officials’ assisting SBM and SBM USA with winning lucrative offshore oil projects from Petrobras.  Zubiate also admitted engaging in a kickback scheme with the bribe-paying sales agent for SBM and its SBM USA.

In November 2017, SBM entered into a $238 million dollar, three-year deferred prosecution agreement with the United States over its role in the conspiracy, while its subsidiary, SBM USA, pleaded guilty to one count of conspiracy to violate the FCPA.

HSI and IRS Criminal Investigation investigated the case.  Trial Attorney Dennis R. Kihm of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Suzanne Elmilady of the Southern District of Texas are prosecuting the case.  The Criminal Division’s Office of International Affairs also provided substantial assistance in this matter.

The Department of Justice is grateful to Brazil’s Ministério Público Federal, the Netherlands Public Prosecution Service and Switzerland’s Office of the Attorney General and Federal Office of Justice for providing substantial assistance in gathering evidence during this investigation.

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/foreign-corrupt-practices-act.

HOUSTON - A former CEO and former executive of an oil services company were sentenced to prison today for their involvement in an international bribery conspiracy. 

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.

Anthony “Tony” Mace, 66, of the United Kingdom was the former CEO of SBM Offshore N.V. (SBM), a Dutch oil services company and a former Board Member of SBM’s U.S.-based subsidiary, SBM Offshore USA Inc. (SBM USA). He was sentenced to serve 36 months in prison and ordered to pay a fine of $150,000. Robert Zubiate, 66, of Agoura Hills, California, a former sales and marketing executive at SBM USA, was sentenced to 30 months in prison and ordered to pay a $50,000 fine.

“Pursuing corrupt companies and individuals who misuse our financial system to commit FCPA violations represents our commitment to keeping the integrity of American democracy in place both here and abroad,” said Patrick. “We will continue to prosecute such cases involving wrongdoing for corporate crimes and greed.”

“Anthony Mace and Robert Zubiate played key roles in a massive bribery scheme that involved the payment of millions of dollars to public officials in exchange for lucrative oil-services contracts,” said Benczkowski. “Their actions rewarded corrupt officials’ greed and tilted the playing field against honest, law-abiding companies. Today they paid a heavy price for their crimes. Their sentences should serve as a warning to corporate executives everywhere: if you pay bribes to advance your business interests, we will catch you and we will prosecute you to the fullest extent of the law.”

 “This case is a prime example of HSI’s enduring commitment to work closely with our foreign law enforcement partners to track down those who seek to gain an unfair competitive advantage in the international marketplace,” said Dawson. “By working together to hold these individuals accountable for their actions, we have taken a significant step to level the playing field for companies and consumers.”

In November 2017, Mace and Zubiate each pleaded guilty to one count of conspiracy to violate the Foreign Corrupt Practices Act (FCPA) in connection with a scheme to bribe foreign government officials in Brazil, Angola and Equatorial Guinea. 

According to admissions made in connection with his plea agreement, Mace acknowledged that prior to his becoming CEO, other employees of SBM entered into an agreement to pay bribes to foreign officials including at Brazil’s state-controlled oil company, Petróleo Brasileiro S.A. (Petrobras); Angola’s state-owned oil company, Sociedade Nacional de Combustíveis de Angola, E.P. (Sonangol); and Equatorial Guinea’s state-owned oil company, Petroléos de Guinea Ecuatorial (GEPetrol). Mace admitted he joined the conspiracy by authorizing payments in furtherance of the bribery scheme and deliberately avoided learning that those payments were bribes. 

In particular, Mace maintained a spreadsheet reflecting payments to five individuals. Mace acknowledged that even though he was aware there was a high risk those individuals were Equatorial Guinean officials, he nevertheless authorized SBM to make over $16 million in payments to those individuals. Mace further continued a practice that was instituted before he became CEO by splitting payments to SBM’s Brazilian intermediary, that is, paying a portion of the intermediary’s commission to an account in Brazil and another portion of the agent’s commission to accounts in Switzerland held in the name of shell companies. Mace deliberately avoided learning the ultimate recipients of the payments that he authorized to the shell companies were Petrobras officials, he admitted.

According to admissions made in connection with Zubiate’s plea, from between 1996 and 2012, Zubiate and others used a third-party sales agent to pay bribes to foreign officials at Petrobras in exchange for those officials’ assisting SBM and SBM USA with winning lucrative offshore oil projects from Petrobras. Zubiate also admitted engaging in a kickback scheme with the bribe-paying sales agent for SBM and its SBM USA.

In November 2017, SBM entered into a $238 million dollar, three-year deferred prosecution agreement with the United States over its role in the conspiracy, while its subsidiary, SBM USA, pleaded guilty to one count of conspiracy to violate the FCPA.

HSI and IRS-Criminal Investigation conducted the investigation. Assistant U.S. Attorney Suzanne Elmilady and Trial Attorney Dennis R. Kihm of the Criminal Division’s Fraud Section are prosecuting the case. The Criminal Division’s Office of International Affairs also provided substantial assistance in this matter.

The Department of Justice is grateful to Brazil’s Ministério Público Federal, the Netherlands Public Prosecution Service and Switzerland’s Office of the Attorney General and Federal Office of Justice for providing substantial assistance in gathering evidence during this investigation.

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/foreign-corrupt-practices-act.

HOUSTON – A federal jury sitting in Houston has convicted a 35-year-old Houston man for carjacking and discharging a firearm during a crime of violence, announced U.S. Attorney Ryan K. Patrick. The jury deliberated for approximately three hours before convicting Sean Rodriguez following a less than three-day trial.  

During the trial, the jury heard from victims who were carjacked at gunpoint. Both described how Rodriguez brandished a silver revolver and pointed it at them. Rodriguez had pistol-whipped the male victim, at which time the gun discharged above the man’s head.

A neighbor also provided testimony who explained how she helped the female victim after she ran to her house to call 911. The jury also heard that call.

The jury also heard from four police officers were involved in a high-speed chase after Rodriguez refused to pull over in the stolen vehicle three days later. The jury saw a helicopter video of the chase and the dash cam of one of the officers. During the chase, Rodriguez went the wrong way down streets at high rates of speed, nearly hit pedestrians and other vehicles before crashing into a family of six.

Chief U.S. District Judge Lee H. Rosenthal presided over the trial and set the sentencing for Jan. 4, 2019. At that time, Rodriguez faces up to 15 years in prison for the carjacking as well as a mandatory minimum of 10 years for the discharging of a firearm which must be served consecutively to any other prison term imposed.

The FBI, Texas Department of Public Safety, Houston Police Department, Harris County Institute of Forensic Science and Harris County Sherriff’s Office conducted the investigation. Assistant U.S. Attorneys Jennie Basile and Britni Cooper are 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 – A 30-year-old Mexican man has been ordered to federal prison for two carjackings which occurred in early 2017, announced U.S. Attorney Ryan K. Patrick. Jorge Luis Almanza-Barcenas pleaded guilty to a six-count second superseding indictment on Sept. 28, 2017.

Today, U.S. District Judge Randy Crane ordered Jorge Luis Almanza-Barcenas to serve a total of 384 months plus one day in prison for the carjackings and related firearms offenses. Following his sentence, he is expected to face deportation proceedings as he is not a U.S. citizen.

Additional information was also presented today including a paraphrased statement form one of the victims in the case which noted her continued fear. Almanza-Barcenas was further ordered to pay $16,348.43 in restitution to the victims.

On March 27, and April 12, 2017, Almanza-Barcenas committed two armed carjackings in McAllen. He approached both female victims, who were sitting in their vehicles, and demanded them to relinquish their vehicles at gunpoint. Almanza-Barcenas pointed a 9mm caliber semiautomatic pistol at the victims’ heads and pulled them out of the vehicle, threatening to kill them. Thereafter, Almanza-Barcenas fled, obtaining the vehicle each time.   .

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

The FBI and McAllen Police Department conducted the investigation. Assistant U.S. Attorneys (AUSA) James Sturgis and David Paxton and former AUSA Lynn Wang prosecuted the case.

HOUSTON – A 35-year-old Houston woman has been ordered to prison following her conviction of one count each of conspiracy to commit wire fraud and conspiracy to commit money laundering, announced U.S. Attorney Ryan K. Patrick. Yanette Rodriguez Acosta aka Yanette Patino pleaded guilty Feb. 22, 2018.

Today, Chief U.S. District Judge Lee H. Rosenthal ordered Acosta to serve an 88-month sentence to be immediately followed by three years of supervised release. In handing down the sentence, the court noted that there was evil in the world and that the defendant had a gleeful disregard for the victims, causing pain, fear and long term effects for profit.

Acosta took part in a scheme in which her co-conspirators in Mexico called victims throughout the United States in Texas, California and Idaho, falsely claiming they had kidnapped a victim’s child. They demanded ransom money in exchange for the safe release of the child. 

“This is a disgusting crime that preyed on a parent’s love for a child,” said Patrick. “Even though there was no actual kidnapping, the crime was designed to be very real to the victims. The perseverance and dedication of federal and state law enforcement agents and officers sends a strong message that we will not tolerate, and will zealously pursue, this kind of crime that terrorizes victims for financial gain.” 

At the hearing today, victims detailed their harrowing and traumatizing experiences as they complied with the caller’s demands, who frequently threatened the victims and their family members with violence and retaliation if they reported the crime. The court also considered written victim impact statements. In one instance, a couple was informed that they could find their child at a nearby middle school. Not finding their son, and unable to get in touch with him, the couple then searched nearby dumpsters for the child’s body. Other victims described their loss of good health, sense of security, trust in others and the devastation and life-changing emotional trauma they experienced as a result of the crime.

“Virtual kidnapping schemes targeting American families are on the rise and those perpetrating the crime have perfected their techniques,” said Assistant Director in Charge Paul Delacourt, of the FBI's Los Angeles Field Office. “Victims of this terrifying scheme have experienced trauma, in addition to losing large sums of money. As the FBI and our partners continue to investigate these crimes and encourage the public to learn the signs of the scheme to avoid victimization, this sentencing should send a message to those perpetrating virtual kidnappings.”

“The sentence received by Acosta today represents a victory not just for the justice system, but for the many traumatized victims who received an intimidating phone call from the perpetrators of this heinous and cruel crime,” stated Special Agent in Charge R. Damon Rowe of IRS-Criminal Investigation (CI). “This investigation reflects IRS-CI’s steadfast commitment to protect our financial system from being used in an unscrupulous manner and hold accountable those who prey on the vulnerability of our relationships with our loved ones.”

The victims, who heard a gasping voice call for “mom” or “dad” on the phone, often responded with their child’s name, unaware that they were providing the caller with that information. Then, referring to the child by name, the caller claimed to have kidnapped the child, falsely leading the victim to believe there was an actual kidnapping. 

Under threats of bodily harm, rape and murder of the child if the line were disconnected, many victims were forced to remain on speakerphone for hours while driving to banks and to various Western Union and MoneyGram locations. In some cases, victims were instructed to make cash drops at specified locations in Houston.

After confirming the wire transfer or money drop, the perpetrators instructed the victims to call the child, who had never been actually kidnapped, or to wait for the child at a specific location, knowing the child would not be there.

Previously released on bond, Acosta was taken into custody following sentencing today where she will remain pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.

The Los Angeles, California, Field Offices of the FBI and IRS-CI conducted the investigation along with the police departments in Los Angeles and Beverly Hills, California, and the Montgomery County, Texas, Sheriff’s Office with the assistance of Immigration and Customs Enforcement’s Homeland Security Investigations in Los Angeles.

Assistant U.S. Attorney Kate Suh is prosecuting the case. The Money Laundering and Asset Recovery Section of the Department of Justice also provided valuable assistance during the course of the investigation.

HOUSTON – The Texas A&M Research Foundation (TAMRF) has agreed to pay the United States $750,000 to resolve claims that the Foundation submitted improper charges to federal grants, announced U.S. Attorney Ryan K. Patrick.

TAMRF is an independent non-profit service organization focused on facilitating research and development within the Texas A&M University System with its principal place of business in College Station. The Texas A&M University System is composed of 17 member institutions and agencies that are classified as institutions of higher education. TAMRF is a recipient of federal grants, cooperative agreements and contracts from various federal agencies, including  the Department of Education (ED), Department of Energy (DOE), NASA, National Science Foundation (NSF) and Department of Transportation (DOT). In addition, TAMRF receives sub-wards and subcontracts under federal grants, cooperative agreements and contracts.

The settlement is the result of an investigation that began after a qui tam, or whistleblower, lawsuit was filed under seal on June 6, 2013. The whistleblowers are employed by TAMRF and alleged that during their employment they witnessed TAMRF allow personnel to ignore federal restrictions and permitted the overcharging of salaries, which inflated grant expenses. The whistleblowers also alleged TAMRF engaged in cost shifting; allowed academic employees to wrongfully receive longevity pay; violated salary caps; and improperly charged grants for expenses not incurred or not covered.

The United States investigated the allegations finding that from January 1, 2007 through November 3, 2016, TAMRF improperly charged additional compensation to federal grants for academic employees at an institution of higher education ineligible to receive such pay.

The United States also concluded that TAMRF improperly charged various federal grants for expenses not properly allocable to them, including salaries and wages for individuals not working on the grants and supplies and equipment unrelated to the grants. TAMRF also improperly charged various federal grants for unallowable costs such as travel expenses unrelated to the objectives of the grants or for unaffiliated parties not working on the grants.

“DOE - Office of Inspector General (OIG) is committed to ensuring the integrity of our grant recipients by holding accountable those who choose to engage in false claim and mischarging schemes,” said Acting Inspector General April G. Stephenson of DOE. “This settlement is the result of a joint investigation which protected the government from inflated claims. We appreciate the efforts of the Department of Justice in pursuing this matter and will continue to work collaboratively with our investigative partners to aggressively investigate those who seek to defraud government programs.”   

“NASA-OIG will continue to investigate all Qui Tam relator allegations of fraud, and applaud the relators that brought this matter to the attention of the United States,” said NASA Inspector General Paul Martin. “NASA-OIG appreciates the cooperative efforts of the entire investigative team during this investigation.”

“The funding NSF provides to our nation’s universities is vital to NSF’s mission of promoting the progress of science, but universities must do their part to ensure that these funds are spent on legitimate costs that directly benefit these awards,” said NSF Inspector General Allison Lerner. “NSF-OIG is committed to vigorously pursuing oversight of these taxpayer funds and I commend the U.S. Attorney’s Office and our investigative partners for their strong support in this effort.”

“Today’s settlement demonstrates that ensuring the integrity of DOT research grant programs is a top priority for the DOT-OIG,” said Regional Special Agent-in-Charge Joseph Zschiesche of DOT-OIG. “Working with our federal law enforcement and prosecutorial colleagues, we will continue to protect taxpayers’ investment in our nation’s infrastructure from fraud, waste, abuse and violations of law.”

Under the False Claims Act, a private party, known as a relator, can file an action on behalf of the United States and receive a portion of the recovery. In this case, the relators will receive $142,500.

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

The U.S. Attorney’s Office (USAO) jointly conducted the investigation along with ED, DOE, NASA, NSF and DOT. Assistant U.S. Attorney Jill Venezia handled the matter for the USAO.

A federal jury found a physician and two clinic owners and operators guilty yesterday for their roles in a $17 million Medicare fraud scheme.

Assistant Attorney General Brian A. Benczowski 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’s (HHS-OIG) Dallas Region and the Texas Attorney General’s Medicaid Fraud Control Unit (MFCU) made the announcement.

John P. Ramirez (Ramirez), M.D., 64; Ann Nwoko Shepherd (Shepherd), 62; and Yvette Nwoko (Nwoko), 30, all of Houston, Texas, were convicted of one count of conspiracy to commit health care fraud after a six-day trial.  In addition, Nwoko was convicted of three counts of health care fraud, Shepherd was convicted of six counts of health care fraud and Ramirez was convicted of three counts of false statements relating to health care matters.  Sentencing is scheduled for Dec. 12 before U.S. District Judge David Hittner of the Southern District of Texas, who presided over the trial.

According to evidence presented at trial, from approximately December 2011 to August 2015, Ramirez, Shepherd and Nwoko conspired and schemed to defraud Medicare out of payments for medical services.  Shepherd owned and operated Southwest Total Medical Inc., a purported medical clinic doing business as Amex Medical Clinic in Houston.  Shepherd sold medical orders and other documents signed by Ramirez to home-health agencies in and around Houston.  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 Ramirez and sold by Shepherd to bill and receive payment from Medicare for medical services that were not medically necessary or not provided.  Later in the conspiracy and scheme, Nwoko acted as the manager of Amex Medical Clinic where she too sold false and fraudulent paperwork used by co-conspirators to bill and receive payment from Medicare for similarly unnecessary medical services, the evidence showed.  Shepherd also caused Amex Medical Clinic to bill Medicare for purported physician services that were actually provided by an unlicensed practitioner, if at all, the evidence showed.

In all, Ramirez, Shepherd and Nwoko caused Medicare to pay approximately $17 million on false and fraudulent claims submitted during the charged conspiracy, the evidence showed.        

This case was investigated by the FBI, HHS-OIG and the Texas Attorney General’s Medicaid Fraud Control Unit.  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 case. 

The Fraud Section leads the Medicare Fraud Strike Force.  Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in 12 cities across the country, 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.

HOUSTON – A former manager of a U.S.-based logistics and freight forwarding company pleaded guilty to a foreign bribery charge today for his role in a scheme to corruptly secure contracts and contract extensions from Venezuela’s state-owned and state-controlled energy company, Petroleos de Venezuela S.A. (PDVSA). The guilty plea of the bribed foreign official was also unsealed today. 

U.S. Attorney Ryan K. Patrick of the Southern District of Texas, 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.

Juan Carlos Castillo Rincon (Castillo), 55, of Conroe, previously of Miami, Florida, pleaded guilty before U.S. Magistrate Judge Nancy K. Johnson of the Southern District of Texas in Houston to one count of conspiracy to violate the Foreign Corrupt Practices Act (FCPA). Castillo is scheduled to be sentenced Feb. 21, 2019 by U.S. District Judge Gray H. Miller of the Southern District of Texas. 

Judge Johnson also unsealed the guilty plea of Jose Orlando Camacho (Camacho), 46, of Miami, Florida, previously of Katy,  the PDVSA official whom Castillo bribed. In July 2017, Camacho pleaded guilty under seal before Judge Miller to conspiracy to commit money laundering. Camacho is scheduled to be sentenced Feb. 21, 2019 by Judge Miller.

“These guilty pleas reflect the hard work of agents and investigators and mark another step in the joint effort to combat foreign corruption,” said U.S. Attorney Patrick. “Our office will continue to prosecute those who bribe foreign officials or use our financial networks to launder the proceeds of these bribes.”   

“Corruption undermines the rule of law, tilts the playing field away from law-abiding businesses, and exposes our financial system to the distorting effects of illicit cash flows,” said Assistant Attorney General Benczkowski.  “The guilty pleas announced today are the latest in a series of actions arising out of an ongoing investigation of bribery at PDVSA.  The Department will continue to combat corruption wherever we find it.”

“Foreign bribery schemes like this pose a significant threat to the public trust and fair trade practices,” said HSI Houston Special Agent in Charge Dawson. “Today’s pleas are a step in the right direction, but we will continue to aggressively investigate individuals and corporations who violate the FCPA to ensure a fair and equal playing field for U.S. companies and consumers.”

Castillo was arrested in Miami on April 19, after a federal grand jury returned a five-count indictment against him. According to admissions made in connection with Castillo’s plea, beginning in or around 2011 and continuing through at least 2013, Castillo, a manager at a Houston-based logistics and freight forwarding company, conspired with others to bribe a PDVSA official in exchange for the official providing assistance in connection with the company’s business with PDVSA.  In exchange for bribe payments, the PDVSA official assisted the company in obtaining PDVSA contracts, contract extensions and favorable contract terms; provided Castillo with inside information concerning the PDVSA bidding process; and supported the company in internal PDVSA meetings regarding purchasing decisions.

As part of his guilty plea, Camacho admitted that while employed by PDVSA or its wholly owned subsidiaries or affiliates, he accepted bribes from Castillo and the logistics and freight forwarding company for which Castillo was a manager in exchange for taking certain actions to assist the company in its business with PDVSA. Camacho also admitted he conspired with Castillo to launder the proceeds of the bribery scheme. 

As part of their plea agreements, both Castillo and Camacho have agreed to forfeit the proceeds of their criminal activity. 

With Castillo’s plea today and the unsealing of Camacho’s plea, the Justice Department has announced charges against 18 individuals, 14 of whom have pleaded guilty, as part of a larger, ongoing investigation by the U.S. government into bribery at PDVSA. The HSI Houston Field Office is conducting the ongoing investigation with assistance from HSI in Boston and from IRS Criminal Investigation. Assistant U.S. Attorneys John P. Pearson and Robert S. Johnson and Trial Attorneys Jeremy R. Sanders and Sarah E. Edwards of the Criminal Division’s Fraud Section are prosecuting the case. Assistant U.S. Attorney Kristine Rollinson is handling the forfeiture aspects of the case.

The Criminal Division’s Office of International Affairs and the Cayman Islands’ Office of the Director of Public Prosecutions 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 – Another local man is headed to federal prison for producing child pornography, announced U.S. Attorney Ryan K. Patrick. Houston resident Miguel Alejandro Morales-Garcia pleaded guilty Feb. 7, 2018.

Today, District Judge David Hittner sentenced a to 327 months in prison to be immediately followed by a lifetime term of supervised release 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.

The more than 27-year-sentence comes a day after a suburban man received 35 years also for sexually exploiting a child as well as possessing child pornography.

The investigation into Morales began when an agent with Immigration and Customs Enforcement’s Homeland Security Investigations (HSI), acting in an undercover capacity, entered an online chat room. At that time, the agent observed a user, later identified as Morales, stream a live video of what appeared to be a minor female who was three to five years of age. The minor was watching a video or show on a tablet with a blue case while wearing white ear bud style headphones. Within seconds, the camera angle panned to the right and showed Morales masturbating. The distance between Morales and the minor victim appeared to be a few inches and the only thing separating Morales and the minor victim was a small brown pillow.

Through the investigation, agents identified the minor victim as being a relative of Morales. Agents performed a forensic examination on his iPhone pursuant to a federal search warrant and discovered images of Morales engaging in sexual contact with the minor victim.

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.

HSI conducted the investigation.

Assistant U.S. Attorney 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."

HOUSTON - A 43-year-old Kingwood resident has been ordered to federal prison for the sexual exploitation of a minor and possession of child pornography, announced U.S. Attorney Ryan K. Patrick. Stephen P. Lynch pleaded guilty June 6, 2018.

Today, District Judge Nancy F. Atlas sentenced Lynch to 360 months for sexual exploitation and five years for the possession charges, respectively. The sentences will run consecutive for a total of 35 years in federal prison. The sentence will be immediately followed by five years of supervised release 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 sentencing today, Judge Atlas heard from the victim’s mother and sibling. They informed the court how Lynch’s actions have scarred their family for life, changed how they viewed the world and stole their sense of security. 

The court considered the length of time the production occurred. The court also heard that the images  are known to be in at least 222 collections of other individuals.

The investigation into Lynch began when Homeland Security Investigations (HSI) agents received information via the HSI Cyber Crimes Center regarding a referral from the National Center for Missing and Exploited Children (NCMEC). The referral advised that an unidentified female minor victim of a child pornography related offense was possibly located in the area of Houston. The child had appeared in a series of child sexual abuse images that were known to domestic and international law enforcement and had been traded over a period of two years. With the identity and whereabouts of the victim unknown, NCMEC analysts enlisted help from a horticulture expert from the Smithsonian Museum of Natural History. He was able to narrow the geographical possibilities for the victim based on plant life in the background of images. With the search narrowed to 10 states, HSI analysts then focused on visible background items in the images. After extraordinary analytical efforts, the investigation let to Kingwood. Investigators searched local parks, dance studios, gyms and other venues for leads. After an exhaustive effort, authorities the suspect was located and the victim was rescued. 

 

Approximately 173 images were included in the referral sent to HSI Houston. At least half of the images constitute child pornography under federal law. Some of the images depict the minor victim fully nude with the child’s genitalia lasciviously displayed. 

On the evening of June 14, 2017, HSI agents identified the victim at a residence in Kingwood. At that time, they interviewed the homeowner, Lynch and he identified two non-pornographic images of the minor victim. He further stated that he personally took one of those images several years ago when she was three-years-old.  He identified himself as the photographer of several non-pornographic images of the minor victim, including one that displays the minor relative wearing a black long-sleeve shirt with a pink glitter heart on the front. Several child pornographic images of the victim also include what appears to be that same shirt. 

In the early morning hours of June 15, 2017, agents obtained a federal search warrant for Lynch’s residence. While authorities were obtaining the search warrant, Lynch went back into the house and destroyed thumb drives by putting them in the microwave. He also attempted to delete items off of a laptop. 

He was arrested June 19, 2017, in Georgetown.

A forensic examination was performed on all of the items seized. During that review, agents found approximately 38 videos and five images of child pornography. The images and videos include children under the age of 12 and acts of violence such as the penetration of the victims. Some of the images are of known victims as identified through the NCMEC.

Further, agents found 71 images of the minor victim which constitute child pornography that Lynch produced by the defendant.  To date, the images of this minor has been found in 222 other investigations and on the dark web.

Homeland Security Investigations conducted the investigation with the assistance of Montgomery County Constable Precincts 2 and 4, Harris County Sheriff’s Office, Conroe Police Department and the Smithsonian Gardens in Washington, DC.

Assistant U.S. Attorney Kimberly Leo prosecuted the case. 

This case 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."

HOUSTON – Three Houston residents have been ordered to federal prison for perpetrating a scheme to obtain two loans totaling $1.3 million, announced U.S. Attorney Ryan Patrick along with Special Agent-in-Charge Laurie L. Younger of the Federal Deposit Insurance Corporation – Office of Inspector General (FDIC-OIG). Hugo Lafuente, 59, pleaded guilty Aug. 29, 2016, while Rick Hajdik, 54, pleaded guilty Nov. 14, 2016.

Today, U.S. District Judge Keith Ellison, who accepted the guilty pleas, handed Lafuente  a 25-month sentence, while Hajdik was ordered to serve a 20-month sentence. Each was further ordered to pay $735,758 in restitution.

“The FDIC-OIG, along with its law enforcement partners, is dedicated to pursuing those who commit schemes to defraud the nation’s federally insured financial institutions,” said Younger.

With the help of a tax preparer, Lafuente, and Hajdik devised a scheme to fraudulently obtain two loans from a local bank. The first was a Small Business Administration loan made to Lafuente for $250,000 and the second was a construction loan for $1,080,000.

The bank approved and funded both loans based on fraudulent and falsified income tax returns and false information in Lafuente’s personal financial statements. Hajdik, who was Lafuente’s loan officer at the bank, came up with the inflated and false numbers that Lafuente needed to show on his income tax returns in order to obtain the loans.

Both loans defaulted and the bank’s loss from the two loans after sale of land collateral was $735,758.  

The FDIC-OIG and The Office of the Special Inspector General for the Troubled Asset Relief Program conducted the investigation. Assistant U.S. Attorney Belinda Beek is prosecuting the case.

LAREDO, Texas – Two Mexican nationals have pleaded guilty for their roles in an alien transporting event which resulted in death, announced U.S. Attorney Ryan K. Patrick.

Mario Emiliano-Herrera and Julio Cesar Lopez-Nino, both 19, admitted they hoped to be paid $100 in exchange for each person successfully smuggled across the Rio Grande River and into the United States.

Emiliano-Herrera and Lopez-Nino were originally arrested Feb. 27, 2018, after Border Patrol (BP) agents encountered them leading a group of undocumented aliens through the brush in Laredo. Nine were ultimately apprehended, two of whom included Emiliano-Herrera and Lopez-Nino. 

Law enforcement learned one of the aliens had passed out and had been left behind and attempted to retrace the group’s steps to no avail.

On March 7, 2018, a ranch foreman notified authorities that a body was found on the property just 1.5 miles north of the Rio Grande River. The deceased male was identified as part of the group Emiliano-Herrera and Lopez-Nino lead. According to witnesses, the victim could no longer keep up with the group, at which time Lopez-Nino kicked him repeatedly and left him behind.

Sentencing will be set at a later date before U.S. District Judge Marina Garcia Marmolejo. Emiliano-Herrera and Lopez-Nino each face up to life in federal prison and a possible $250,000 fine. They remain in custody pending that hearing.

Immigration and Customs Enforcement’s Homeland Security Investigations conducted the investigation along with BP. Assistant U.S. Attorney Giselle S. Guerra is prosecuting the case. 

A 31-year-old Illegal alien residing in Ciudad Hidalgo, Michoacan, Mexico, has been ordered to prison following his conviction of assaulting a Border Patrol (BP) agent during his attempt to illegally enter the country, announced U.S. Attorney Ryan K. Patrick. Edgar Garrido-Miranda pleaded guilty Dec. 5, 2017.

Today, U.S. District Judge Marina Garcia Marmolejo ordered him to prison for 60 months and ordered restitution in the amount of $4,788.79. At the hearing, the court heard that this was not an accidental act on Garrido-Miranda's part. She sternly him warned him that things could have gone very wrong, including being shot. Not a U.S. citizen, he is expected to face deportation proceedings fooling his sentence.

On Aug. 16, 2017, BP agents encountered a group of undocumented aliens near the Zacate Creek area in south Laredo. Garrido-Miranda was a member of that group. Law Enforcement attempted to arrest him, at which time Garrido-Miranda became combative.

During the struggle, Garrido-Miranda held one of the BP agents under water until a second agent came to his rescue.

At the hearing today, the court noted the BP agent's restraint in not resorting to deadly force under the circumstances.

The victim suffered bruises and contusions as well as a throat infection as a result of the encounter.

Garrido-Miranda 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 with the assistance of BP. Assistant U.S. Attorney José Angel Moreno prosecuted the case.

CORPUS CHRISTI, Texas – The leader of a massive heroin and money laundering conspiracy has been ordered to federal prison, announced U.S. Attorney Ryan K. Patrick. Jesus Gutierrez, 46, of Corpus Christi, pleaded guilty April 26, 2018, to conspiracy to possess with intent to distribute more than one kilogram of heroin and conspiracy to launder money.  

Today, U.S. District Judge Nelva Gonzales Ramos sentenced him to 84 months in prison.

At the time of his plea, the court learned that he had been part of a significant, long-term heroin distribution ring operating in Robstown. Evidence also showed that on Oct. 4, 2017, authorities seized approximately a kilogram of heroin and almost $100,000 during the arrests related to this investigation.

Gutierrez and his nephew, Enrique Gutierrez Jr., regularly obtained kilogram quantities of heroin during the conspiracy that was then distributed via the other defendants. The overall scope of the conspiracy was estimated to be between 10-30 kilograms of heroin. The conspiracy operated between April 2016 and October 2017.

On May 9, 2018, Judge Ramos sentenced Enrique Gutierrez Jr., 31, of Sandia, to 13 years imprisonment. He had previously pleaded guilty to the same heroin conspiracy as well as conspiracy to launder money.

Also previously sentenced were Sakhone Chanrattana, 35, of Jarrell, who was ordered to serve 97 months, and Tim Molina, 34, of Robstown, who received a sentence of 18 months.

In assessing the sentences, Judge Ramos pointed to the large amount of heroin distributed in this conspiracy and its devastating impact on the community and families. 

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

HOUSTON ‐ A total of six Houston-area residents have been charged with varying offenses related to disaster assistance in their alleged efforts to defraud the Federal Emergency Management Agency (FEMA) and Small Business Administration (SBA).

U.S. Attorney Ryan K. Patrick made the announcement just after the Gulf Coast region marked the one-year anniversary of Hurricane Harvey, the costliest storm in United States history.  

“These types of cases are no different than looting during and after a storm,” said Patrick. “Some people try to exploit natural disasters by taking things that aren’t theirs. It is white collar storm looting, and fewer people who actually need assistance get it.”

Five are charged in separate indictments linked to Hurricane Harvey with a sixth stemming from the Houston-area Memorial Day weekend flood in 2015.

The first indictment charges Clinton Booker, 51, of Houston, with engaging in a scheme to defraud the SBA when he applied for and received a disaster loan from the SBA. He allegedly claimed property damage from Hurricane Harvey in August 2017, but his residence had not sustained damage as claimed. According to the indictment, Booker submitted or caused others to submit falsified records to make the claim appear legitimate. Booker received $25,000 from the fraudulent SBA loan. He is charged with one count of fraud in connection with a major disaster and one count of wire fraud for which he faces up to 30 and 20 years in federal prison, respectively.

In a separate, but similar case, Randal Radack, 44, of Spring, allegedly engaged in a scheme to defraud the SBA and FEMA when he applied for and received disbursements, claiming property damage from Hurricane Harvey. However, he actually he did not reside at the property during Hurricane Harvey as claimed, according to the allegations.  Radack allegedly received $115,100 from the fraudulent SBA loan and $16,541.38 in fraudulent disbursements from FEMA. Radack is charged with two counts of fraud in connection with a major disaster and five counts of wire fraud for which he faces up to 30 and 20 years in federal prison, on each count, respectively.

According to additional allegations, Humble resident Robert Kaitho, 55, also engaged in a scheme to defraud the SBA. He applied for and received a disaster loan from the SBA, claiming property damage from Hurricane Harvey when his residence had not sustained damage as claimed. According to the indictment, Kaitho used some of the proceeds from the fraudulent SBA loan to pay a credit card company. Kaitho received $53,000 from the fraudulent SBA loan, according to the charges. He is charged with one count of fraud in connection with a major disaster, two counts of wire fraud and two counts of money laundering.  If convicted of the disaster fraud, he faces up to 30 years in prison, while wire fraud and money laundering carry a punishment of up to 20 and 10 years in federal prison, respectively. 

Christopher Howard, 45, of Highlands Ranch, Colorado, did not even reside at his Crosby property at the time of Hurricane Harvey. Nevertheless,  he allegedly applied for and received FEMA disbursements, claiming property damage.  Howard received $30,586.45 in fraudulent disbursements from FEMA as a result of the claim, according to the allegations. He is charged with one count of fraud in connection with a major disaster and four counts of wire fraud for which he faces up to 30 and 20 years in federal prison, respectively. 

Patricia Rodriguez, 38, of Houston, also allegedly engaged in a scheme to defraud when she applied for and received FEMA disbursements, claiming property damage from Hurricane Harvey. She was not even the owner of the property as claimed, according to the indictment. However, Rodriguez allegedly received $33,300 in fraudulent FEMA disbursements. She also faces a maximum of 30 and 20 years in federal prison, respectively, upon conviction of one count each of fraud in connection with a major disaster and wire fraud.

The final indictment alleges David Boniface claimed property damage from the Memorial Day flood in 2015, when his residence had not sustained damage as he had reported. Boniface, 60, of League City, applied for and received a disaster loan from the SBA totaling $64,200. He submitted or caused others to submit falsified records to make the claim appear legitimate. Boniface is charged with one count of fraud in connection with a major disaster and two counts of wire fraud which carry 30 and 20-years maximum federal prison terms, respectively. 

“Fraud cases take time to investigate,” Patrick explained. “One year after the storm my office is actively engaged with DHS and other agencies in similar investigations. This is just the first of what will probably be many cases related to Hurricane Harvey.”

All six people charged today are expected to make their initial appearances before a U.S. magistrate judge in the near future.

The SBA-Office of Inspector General (OIG) and the Department of Homeland Security –OIG conducted the investigations. Assistant U.S. Attorney Michael Day is prosecuting the cases.

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

A Houston psychiatrist was sentenced today to 150 months in prison for his role in a $155 million Medicare fraud scheme involving false and fraudulent claims for psychiatric services.

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Ryan K. 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’s (HHS-OIG) Dallas Region, Special Agent in Charge D. Richard Goss of IRS Criminal Investigation’s (IRS-CI) Houston Field Office, Special Agent in Charge Kristin Osswald of the Railroad Retirement Board Office of Inspector General’s (RRB-OIG) Chicago Regional Office, and Unit Division Chief Stormy Kelly of the Texas Attorney General’s Medicaid Fraud Control Unit (MFCU) made the announcement.

Riyaz Mazcuri, 67, a former attending psychiatrist at Riverside General Hospital (Riverside) of Houston, was sentenced by U.S. District Judge Vanessa D. Gilmore of the Southern District of Texas.  Judge Gilmore also ordered Mazcuri to pay $20,607,410.22 in restitution to Medicare and $2,250,789.69 in restitution to Medicaid.

On May 23, 2017, following a five-day trial, a jury convicted Mazcuri of one count of conspiracy to commit health care fraud, and five counts of health care fraud. 

According to the evidence at trial, from 2006 until February 2012, Mazcuri and others engaged in a scheme to defraud Medicare by submitting to Medicare, through Riverside, approximately $155 million in false and fraudulent claims for partial hospitalization program (PHP) services.  A PHP is a form of intensive outpatient treatment for patients with severe mental illness. 

In addition, evidence presented at trial showed that Mazcuri indiscriminately admitted and readmitted patients into these intensive psychiatric programs – often for years on end – many of whom suffered from severe Alzheimer’s or dementia and were unable to participate in the treatment purportedly provided at the PHPs, and who therefore did not qualify for the services.  Evidence also showed that Mazcuri falsified medical records and signed false documents to make it appear as if patients admitted to the PHPs qualified for, required, and actually received the intensive psychiatric services. 

Evidence also demonstrated that Mazcuri personally billed Medicare for psychiatric treatment he purportedly provided to Riverside’s PHP patients – treatment he never actually provided.  Mazcuri’s signature on patient documents enabled Riverside to bill Medicare for over $55 million of the total $155 million that Riverside billed Medicare for fraudulent psychiatric services, the evidence showed.

To date, 15 others have been convicted of offenses based on their roles in the fraudulent scheme, including Earnest Gibson III, 73, the former president of Riverside; Earnest Gibson IV, 41, the operator of one of Riverside’s PHP satellite locations; Regina Askew, 53, a group home owner and patient file auditor; and Robert Crane, 61, a patient recruiter, all of whom were convicted after a jury trial in October 2014.  Earnest Gibson III was sentenced to 45 years in prison.  Earnest Gibson IV was sentenced to 20 years in prison.  Regina Askew was sentenced to 12 years in prison.  Robert Crane was sentenced to serve 30 months in prison.  Mohammad Khan, 68, an assistant administrator at the hospital, who managed many of the hospital’s PHPs, pleaded guilty and was sentenced to 40 years in prison.  Sharon Iglehart, 61, a physician, was also convicted after a jury trial in August 2015.  She was sentenced to 12 years in prison.  Walid Hamoudi, 66, a physician, pleaded guilty in August 2015.  He was sentenced to five years in prison.

The case was investigated by the FBI, HHS-OIG and IRS-CI with assistance by RRB-OIG and MFCU. The case was prosecuted by former Assistant Chief Ashlee Caligone McFarlane and Trial Attorneys Aleza Remis and Kevin Lowell of the Criminal Division’s Fraud Section.             

The Medicare Fraud Strike Force operations are part of a joint initiative between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country.  The Medicare Fraud Strike Force operates in 10 areas nationwide.  Since its inception in March 2007, the Medicare Fraud Strike Force has charged over 3,500 defendants who collectively have falsely billed the Medicare program for over $12.5 billion.

McALLEN, Texas – A 24-year-old Edinburg resident has been ordered to federal prison following his convictions for alien smuggling and assaulting a federal agent, announced U.S. Attorney Ryan K. Patrick. Victor Eduardo Acevedo-Ventura pleaded guilty Dec. 28, 2017.  

Today, U.S. District Judge Micaela Alvarez handed Acevedo-Ventura a sentence of 50 months in prison to be followed by three years of supervised release. In handing down the sentence, Judge Alvarez noted Acevedo-Ventura’s dangerous actions in ramming the Border Patrol (BP) agent’s vehicle and that this wasn’t his first time fleeing from law enforcement officers.

On Oct. 24, 2017, BP pulled over Acevedo-Ventura just south of the Falfurrias checkpoint. Authorities discovered he had just smuggled and dropped off six illegal aliens in order to bypass the checkpoint through the brush. Acevedo-Ventura initially complied with BP and pulled to the side of the road.

However, almost immediately thereafter, he fled at approximately 75 mph.  Three Border Patrol agents pursued him. Acevedo-Ventura then slammed the Expedition he was driving into the lead agent’s patrol vehicle twice, before spinning out of control and leaving both vehicles with substantial damage.

At the hearing today, the court stated how fortunate Acevedo-Ventura was that he didn’t severely injure the agent. Judge Alvarez noted that did not diminish the seriousness of his conduct.

Acevedo-Ventura had been and will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.

BP and the FBI conducted the investigation. Assistant U.S. Attorney David A. Lindenmuth prosecuted the case.

CORPUS CHRISTI, Texas – A 35-year-old former Corpus Christi resident has been ordered to prison for wire fraud and tax evasion, announced U.S. Attorney Ryan K. Patrick. Brian Perez pleaded guilty March 1, 2018.

Today, U.S. District Judge Nelva Gonzales Ramos handed Perez an 18-month sentence to be immediately followed by three years of supervised release. He was also ordered to pay $162,755 in restitution to his employer and an additional $42,435.18 in criminal restitution to the IRS. At the hearing, Assistant U.S. Attorney (AUSA) Robert Thorpe detailed prior thefts from a previous employer and additional thefts from another corporation affiliated with his current victim.

Perez’ family members testified about his lack of criminal history and made pleas for probation. However, the court noted such a sentence was not appropriate as there was a significant amount of loss and harm to multiple victims occurring over several years.

The court also ordered that funds fraudulently transferred to Perez’ tax withholding account at the IRS as part of the scheme be returned to victims. His tax refunds during his period of incarceration and supervised release will also be used to pay restitution to his victims.   

Perez, now of San Antonio, was a Certified Public Accountant. As part of his plea, Perez admitted that while working as a bookkeeper, he orchestrated the fraudulent transfer of funds from his employer’s bank account to his personal tax withholding account. Perez also admitted he filed a false income tax return and requested a refund of the overpayment.

Through this scheme, Perez defrauded his employer of $162,755 between March 9, 2015, and Aug. 7, 2015. 

IRS-Criminal Investigation and the FBI conducted the investigation. Assistant U.S. Attorney Robert D. Thorpe Jr. is prosecuting the case.

HOUSTON – A 45-year-old woman has been ordered to prison on for charges related to defrauding the Federal Highway Administration Congestion mitigation Air Quality and Surface Transportation Program (FHWA-CMAQ), announced U.S. Attorney Ryan K. Patrick along with Special Agent in Charge Joseph Zschiesche of the Department of Transportation - Office of Inspector General (DOT-OIG). The jury deliberated for less than two hours following a two-day day trial before convicting Shonda Renee Stubblefield Feb. 28, 2018, of all the counts in the indictment - theft of public money, mail fraud, wire fraud, money laundering and aggravated identity theft.

Today, U.S. District Judge Alfred Bennett handed Stubblefield a total 72-month sentence - 48 months for theft, mail fraud, wire fraud and money laundering to be followed by an additional 24 months for aggravated identity theft which will be served consecutively. She will also serve three years of supervised release following her release.

At trial, a federal jury found Stubblefield, the owner of World Corporation Inc. (WCI)., stole $125,659.90 from the Department of Transportation (DOT) CMAQ program funded by the Federal Highway Administration (FHWA).

The CMAQ Program provides money to reduce traffic congestion and thereby reduce air pollution in certain areas. The jury heard that Stubblefield stole the money by falsely and fraudulently representing to Houston Galveston Area Counsel (HGAC) that she had hundreds of employees working at WCI who participated in a telework program designed to reduce air-pollution.

The United States proved at trial through documents and 26 witnesses that Stubblefield created a fake business list, fake bank records, fake income and earnings statements and other false WCI business records including employee timesheets, invoices and match documents. The testimony included that of an individual whose identification information Stubblefield stole and used to create a fake $18,100 check that was submitted to the government to further the theft. The evidence and testimony revealed Stubblefield created at least 500 fake and fictitious WCI employee profiles that included fake names, addresses and email accounts.

The defense attempted to convince the jury that Stubblefield was not the person who engaged in the criminal activity, despite the fact that her name was on virtually all WCI business records, at least four witnesses identified her and the money trail lead directly to Stubblefield’s bank account.

Stubblefield 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 DOT-OIG conducted the investigation. Assistant U.S. Attorneys Julie Redlinger and Michael Day prosecuted the case.

HOUSTON – Waste Management Texas has entered into a non-prosecution agreement with the government based upon a pattern and practice of hiring illegal aliens at the company’s Houston location, announced U.S. Attorney Ryan K. Patrick along with Special Agent in Charge Mark Dawson of Immigration and Customs Enforcement’s Homeland Security Investigations (HSI).

Waste Management Inc. is North America’s leading provider of waste disposal and collection headquartered in Houston. The company serves nearly 20 million municipal, commercial, industrial and residential customers. Waste Management of Texas employed at least three managers at its Afton location who actively encouraged and induced aliens to work illegally between 2003 and April 2012.

The five-year HSI investigation resulted in the execution of search warrants in April 2012 where authorities discovered 16 illegal aliens at the Afton location with at least 100 employees in company records verified as fraudulently documented or using an identity that did not belong to them. 

“The non-prosecution agreement requires Waste Management to continue its substantial remedial measures to address all past immigration violations and forfeit more than $5.5 million in proceeds gained from hiring an illegal workforce at the Afton location,” said Patrick. “In considering whether to enter into such agreements, we must take into account the collateral consequences that a criminal prosecution would have on the company’s contracts with many municipalities across the country and the thousands of employees for the conduct of three managers at one operating unit in Houston.”

“Federal law requires employers to hire only U.S. citizens and aliens who are authorized to work in the country,” said Dawson. “This company hired manual laborers with little or no regard for their legal status for almost 10 years at their Afton location. Today, they paid a substantial price for that conduct. We will continue to vigorously enforce immigration law where we find employers engaging in a pattern or practice of hiring unauthorized individuals in reckless disregard of the law.”

Waste Management of Texas hired various staffing agencies to provide contract laborers. Many were hired or rehired at the Afton location in reckless disregard of the fact that they were not authorized to work. The undocumented workforce allowed the company to maintain their preferred helper workforce to maximize profits and productivity. The estimated proceeds to the company derived from this conduct at the Afton location is $5,527,091.55, the amount forfeited to the United States today.

Managers at the Afton location fired at least 10 employees in January 2012 because they lacked documentation. The aliens were told to assume the identity of actual U.S. citizens or individuals with legal status in order to work there. Managers also engaged in an identity theft scheme providing the terminated aliens with names and identifiers of actual individuals with status in the United States to allow the illegal aliens to be employed and added to the company’s payroll.

A federal grand jury indicted three managers in May 2014 for engaging in a conspiracy between 2008 and 2012 to induce and encourage unlawful immigration through a scheme to employ undocumented aliens as helpers on waste trucks picking up garbage in and around Houston. All were convicted and received sentences of 27 - 94 months. 

Waste Management of Texas cooperated with the government’s criminal investigation and conducted their own internal investigation. They determined the managers at their Afton location intentionally thwarted pre-existing immigration compliance procedures that have since been enhanced to prevent future hiring of unauthorized aliens seeking employment by fraud or identity theft.

HSI conducted the long-term investigation. Assistant U.S. Attorneys Casey N. MacDonald, Douglas Davis and Edward Gallagher prosecuted the case and negotiated the non-prosecution agreement with the company. 

CORPUS CHRISTI, Texas – A Mexican National illegally in the United States has entered a guilty plea to attempting to smuggle four illegal aliens through the brush which resulted in death, announced U.S. Attorney Ryan K. Patrick.

Sergio Daniel Barba-Rayo, 27, pleaded guilty to conspiring to move an alien illegally in the United States.

Barba-Rayo was guiding a group of illegal aliens around the U.S. Border Patrol (BP) Checkpoint near Falfurrias when law enforcement agents discovered them. Some of the illegal aliens claimed Barba-Rayo was the guide and that a fifth illegal alien was left in the brush after not being able to keep up with the group. Authorities ultimately found the victim whom was already deceased.

Barba-Rayo was arrested at that time. He has been and will remain in custody pending his sentencing, set for Dec. 4, 2018, before U.S. District Judge Nelva Gonzales Ramos. At that time, he faces up to 10 years in prison and a possible $250,000 maximum fine.

Immigration and Customs Enforcement’s Homeland Security Investigations conducted the investigation with the assistance of the Border Patrol. Assistant U.S. Attorney David Paxton is prosecuting the case.

HOUSTON – Two men have been ordered to prison after DNA found in seminal fluid identifies them in connection to the armed robbery of a Houston area massage parlor, announced U.S. Attorney Ryan K. Patrick. Javian Chapman, 20, and  Joseph Berzat, 21, both of Houston, pleaded guilty in March 2018 to two counts of aiding and abetting interference with commerce by robbery and one count of aiding and abetting the discharge of a firearm during and in relation to a crime of violence.

Today, U.S. District Judge Andrew S. Hanen handed Chapman a 63-month sentence for the robbery charges in addition to an additional 120 months for the firearms charge which must be served consecutively to the other sentence imposed. Berzat received 96 months for the robbery charges and 120 months for the firearms charge. The respective 183 and 216-month terms of imprisonment will be immediately followed by five years of supervised release. The defendants were also ordered to pay restitution for an ATM they damaged and the cash they stole as well as medical expenses incurred by one of the victims. At the hearing, the court heard Berzat and Chapman had physically assaulted the employees. The court determined that the robbers had abducted employees by forcing them to move into separate rooms at gunpoint.

From approximately 11:00 p.m. Friday, Aug. 5, 2016, until nearly 2:00 a.m. Aug. 6, 2016, Chapman and Berzat entered Hana Spa located at 14015 Bammel North in Houston, demanding money and property at gunpoint. They ultimate left with cash, a Samsung Galaxy S5 cell phone and a 2014 Acura SUV. While inside, the suspects broke open the ATM and removed cash from inside using a drill and other tools they had brought with them. They also discharged a firearm.

During the robbery, the suspects had physically and sexually assaulted employees. Authorities later processed the scene for forensic evidence and uncovered DNA from seminal fluid found at the scene which positively identified Berzat and Chapman. Investigators also recovered a palm print from the ATM, which was determined to match Berzat. In addition, Spa employees identified both men as the suspects that held pistols and demanded money during the robbery.

Chapman and Berzat have been and will remain in custody.  

The FBI and Harris County Sheriff’s Office conducted the investigation. Assistant U.S. Attorneys Carrie Wirsing and Jill J. Stotts 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.

McALLEN, Texas – A 21-year-old man from Roma has been ordered to federal prison following his conviction for aiding and abetting the making of false statements or representations with regards to firearms records, announced U.S. Attorney Ryan K. Patrick. Alexis Lopez pleaded guilty May 15, 2017.  

Today, U.S. District Judge Randy Crane sentenced Lopez to 51 months imprisonment to be immediately followed by three years of supervised release. The sentence was enhanced as the court took into consideration the fact that Lopez recruited and directed three straw purchasers to purchase a total of four .50 caliber rifles on his behalf.

From 2015 to 2017, Lopez and straw purchasers bought a total of 10 firearms, five of which were previously recovered in Mexico. The majority of the firearms were military style firearms. In one instance, authorities recovered a .50 caliber rifle in Mexico within 17 days of its purchase.  

During the hearing today, the court heard that the investigation began when a federal firearms license holder (FFL) referred information to law enforcement concerning a suspicious individual believed to be using an assumed name who was attempting to purchase a grenade launcher. Authorities later determined that the individual in question was Lopez. 

Lopez has been and will remain in federal 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 and Immigration and Customs Enforcement’s Homeland Security Investigations jointly conducted the investigation. Assistant U.S. Attorney Linda Requénez prosecuted the case.

HOUSTON – A physician who has practiced in Houston for more than 30 years has entered a guilty plea to tax evasion, announced U.S. Attorney Ryan K. Patrick.

Edward J. Crouse acknowledged in the plea agreement that he has not timely filed an individual income tax return since 1997.  According to the plea agreement, Crouse earned more than $4.4 million from 2009 - 2012. 

Crouse 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 has agreed that the total intended tax loss in his case was approximately $678,103, which accounts for unpaid individual income taxes as well as the amounts of federal taxes and FICA that Crouse withheld from the wages of his medical practice employees but did not pay over to the IRS. 

He has agreed to pay restitution to the IRS of $678,103. 

Sentencing has been set for Dec. 13, 2018, before Chief U.S. District Judge Lee Rosenthal. At that time, Crouse faces up to five imprisonment and a possible $250,000 maximum fine.

He was permitted to remain on bond pending that hearing.       

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

McALLEN, Texas – A 41-year-old resident of Corpus Christi has been ordered to federal prison following his convictions of conspiracy and possession with the intent to distribute cocaine, announced U.S. Attorney Ryan K. Patrick. A federal jury convicted Ramiro Cordova Jr. Oct. 18, 2016, following less than two days of trial and approximately an hour of deliberation.

Today, U.S. District Judge Randy Crane, who presided over the trial, ordered Cordova to serve a 240-month sentence to be immediately followed by five years of supervised release. In handing down the sentence, Judge Crane noted Cordova’s status as a career offender due to his criminal history which included convictions for engaging in organized criminal activity to commit aggravated robbery and aggravated kidnapping and possession with intent to distribute 728 kilograms of marijuana.

During trial, the jury heard that on Sept. 1, 2016, law enforcement learned of a suspicious tractor trailer and conducted surveillance on the vehicle. They later executed a traffic stop on the vehicle in Edinburg, during which time a K-9 alerted to the presence of narcotics. The tractor trailer was then transported to the Pharr port of entry for further inspection where authorities located 40 bundles of cocaine weighing approximately 47 kilograms. Cordova was the driver.    

Cordova was arrested and said he believed he was transporting marijuana. However, in subsequent interviews, he admitted he was transporting cocaine and was to be paid approximately $1,000 per kilogram he transported.

At trial, the defense argued that Cordova was transporting the drugs due to threats he received against members of his family for previously serving as an informant. Cordova took the stand and admitted to being previously convicted of transporting more than 700 kilograms of marijuana in 1999 and served 115 months in federal custody. He further testified that after being released from custody, he was coerced into delivering at least an additional six loads of a controlled substance to various cities across the United States, including Chicago. 

Texas Department of Public Safety conducted the investigation with the assistance of the Alton Police Department and Customs and Border Protection. Assistant U.S. Attorneys Roberto Lopez Jr. and Robert L. Guerra Jr. prosecuted the case.

HOUSTON – A federal jury has convicted a 37-year-old Spring resident of distribution, receipt and possession of child pornography, announced U.S. Attorney Ryan K. Patrick. The jury deliberated for less than three hours before convicting Mark Adair following a two-day trial.

The jury heard that Adair had been uploading and downloading child pornography via peer-to-peer software. Authorities has executed a search warrant at his residence which resulted in the discovery of computer media and external digital storage devices. Forensic analysis revealed more than 26,000 child pornography images and 490 child pornography videos.  

At trial, the jury learned Adair was receiving child pornography and moving it from his computer to a thumb drive hours before authorities executed the search warrant. Adair had used peer-to-peer software on 30 separate days between December 2015 and February 2016 to receive and distribute child pornography images and videos.

The defense attempted to convince the jury there were other people in the home that could have been the source of the child pornography. However, the government presented evidence including photographs that demonstrated Adair lived alone.

Further, all the devices containing the child pornography were found in the living room. Three of the devices were located on the coffee table next to a tube of personal sexual lubricant. A sexual stimulation device known as a “fleshlight” was also fully visible, next to the sink. A “fleshlight” is a sexual stimulation device disguised as a flashlight but, when opened, reveals a rubber insert modeled after a vagina.

The jury heard arguments that had someone lived with anyone else, these items would likely not be out in the open for anyone to see.

U.S. District Judge Keith P. Ellison presided over the trial and set sentencing for Nov. 14, 2018. Adair has been and will remain in custody pending that hearing.

At that time, Adair faces a minimum of five and up to 20 year for the distribution and receipt of child pornography as well as a maximum of 10 years for the possession charge. Additionally, the charges are punishable by a $250,000 possible maximum fine.

The FBI conducted the investigation.

Assistant U.S. Attorneys Kimberly Ann Bulger Leo and Sherri L. Zack are prosecuting 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 – Two Robstown residents have been taken into custody on charges of conspiracy and falsifying records related to aircraft parts, announced U.S. Attorney Ryan K. Patrick.

Albert Flores, 57, of Corpus Christi, and Samuel Escareno, 54, made their initial appearances before U.S. Magistrate Judge Judge B. Janice Ellington today, at which time they were ordered into custody pending a detention hearing set for Aug. 30 at 9:00 a.m. before Judge Ellington.

A federal grand jury indicted Flores and Escareno, both former supervisors at the Corpus Christi Army Depot, on one count each of conspiracy and falsifying records related to aircraft parts. 

The indictment alleges Flores and Escareno did aid, abet, council, command and induce others to make false entries and certifications on UH-60 Black Hawk helicopter main rotor blade dynamic balance data sheets. The defendants allegedly did so in order for  nonconforming rotor blades to appear to meet specifications when they actually did not.

If convicted, Flores and Escareno both face a sentence of up to 10 years in federal prison and a fine of up to $250,000. 

The Department of Army’s Criminal Investigation Division – Major Procurement Fraud Unit conducted the investigation. The Robstown Police Department assisted in the arrest. Assistant U.S. Attorney Robert D. Thorpe Jr. is prosecuting the case.

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

LAREDO, Texas – Federal charges have been filed against a Texas Army National Guardsman for stealing approximately 1.5 kilograms of methamphetamine from Customs and Border Protection (CBP), announced U.S. Attorney Ryan K. Patrick.

Law enforcement arrested Edwin Baez, 20, of Cypress, Friday following the filing of sealed criminal complaint. He made his initial appearance in Laredo federal court before U.S. Magistrate Judge Diana Song Quiroga today, at which time he was ordered detained pending a detention hearing set for Aug. 31 at 10:00.  

Baez, a private with a Texas Army National Guard Unit stationed in Houston, is charged with theft of government property, conspiracy and possession with intent to distribute approximately 1.5 kilograms of methamphetamine. 

At the time of the alleged offense, Baez was deployed to Laredo to assist CBP at the World Trade Bridge by providing mission enhancing capabilities such as surveillance, reconnaissance, operational and logistics support.

According to the charge, on Aug. 1, 2018, Baez removed a picture frame he knew contained bundles methamphetamine that were hidden within it. He allegedly took the frame to a CBP dumpster for disposal, later returning to retrieve some of the methamphetamine. The criminal complaint alleges he took the drugs to his hotel room with plans to consume some of it and sell the remainder. 

He was arrested following his release from the hospital for a drug-induced emergency.

The total value of the methamphetamine allegedly totals approximately $12,000.

If convicted of the drug charges, Baez faces a minimum of 10 years and up to life in federal prison. He also faces up to 10 years if convicted of theft of government property.

Immigration and Customs Enforcement’s Homeland Security Investigations conducted the investigation with the assistance of CBP. Supervisory Assistant U.S. Attorney Homero Ramirez 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.

HOUSTON – Two men have been ordered to federal prison following their convictions of conspiracy to commit wire fraud in a scheme that involved more than over 200 victims, announced U.S. Attorney Ryan K. Patrick along with Special Agent in Charge Gary Smith of the Treasury Inspector General for Tax Administration (TIGTA). Vedas Engineer, 34, Bhavdip Sanghavi, 37, pleaded guilty in July and December 2017, respectfully.

Today, U.S. District Judge David Hittner ordered Sanghavi to serve 96 months in prison. Engineer received the same sentence May 30, 2018. Both were also ordered to serve three years of supervised release following their sentences and are to pay more than $1 million in restitution.

In imposing the sentence, the court considered the offense which involved more than 200 victims across the United States, some of whom were elderly.

The scheme involved victim tax-payers across the United States who were pressured to pay money to resolve alleged tax debts via wire transfers. 

“Over the past five years, TIGTA has received reports of over 2.3 million impersonation related calls with over 14,000 victims reporting losses of almost $70 million, said Smith. “Victimizing taxpayers by impersonating IRS employees is a serious crime. TIGTA and our law enforcement partners are doing  everything within our power to ensure that those involved in the impersonation of IRS employees are prosecuted to the fullest extent of the law.”

Those who receive such calls are urged to report the numbers to TIGTA on the agency’s website.

TIGTA conducted the investigation. Assistant U.S. Attorney Celia Moyer is prosecuting the case.

BROWNSVILLE, Texas – The son of the former Gulf Cartel leader has been ordered to federal prison following his conviction of illegally possessing a firearm and impersonating a U.S. Marshal, announced U.S. Attorney Ryan K. Patrick. Osiel Cardenas Jr., 26, pleaded guilty May 22, 2018.

Today, U.S. District Judge Fernando Rodriguez Jr., handed Cardenas a 27-month sentence to be immediately followed by three years of supervised release. The court also ordered Cardenas to pay a $15,000 fine.

On March 14, 2018, authorities responded to the SKY Bar and Lounge in Brownsville in response to reports of an individual within the club brandishing a firearm. That person was identified as Cardenas. He was found next to his vehicle within the SKY Bar and Lounge parking lot and arrested for public intoxication. At the time of his arrest, Cardenas informed officers he was a U.S. Marshal and asked them to look at his badge. Hanging on his neck, under his shirt, officers located a gold colored Cameron County District Attorney’s badge. Officers also found a Bersa, .380 caliber firearm inside his vehicle which also contained his identification documents and U.S. currency.

Witnesses identified Cardenas as the individual inside the nightclub brandishing the firearm. They also identified the firearm recovered from his vehicle as the firearm they had seen Cardenas brandish within the nightclub. They indicated Cardenas had also displayed a gold colored badge and identified himself as a U.S. Marshal. The witnesses indicated Cardenas ordered patrons to leave the nightclub or they would be arrested for failure to follow his commands.

The Bureau of Alcohol, Tobacco, Firearms and Explosives and the Brownsville Police Department conducted the investigation. Assistant U.S. Attorney Angel Castro is prosecuting the case.

HOUSTON - A federal jury has convicted a 25-year-old Houston woman for the

robbery of the International Bank of Commerce (IBC) in June 2016, announced U.S. Attorney Ryan K. Patrick. The jury deliberated for less than three hours before convicting Mary Mosley following a three-day trial. 

At trial, the jury heard that Mosley was as employee at IBC bank in Houston when she gave her then boyfriend, Kendrick Miller, and his brother, Kenneth Glenn, inside information regarding bank operations and procedures. Mosley informed Miller how much money was in the vault, that it took two people to open it and information about when security would arrive.

On June 9, 2016, Miller, Glenn and Mosley’s cousin - Xavier Cain showed up ready to commit the robbery as planned. However, when Mosley and her co-worker arrived early on that morning, the front doors of the bank would not open.

Mosley then told the robbers she had left the back door unlocked so they could enter the building. Miller and Glenn entered the bank with a handgun. Glenn then ordered Mosley’s co-worker to the ground at gunpoint and ordered Mosley and her co-worker to open the vault. Miller, Glenn and Cain drove away with the money from the vault.

Miller, 29, Cain, 27, and Glenn, 24, all of Houston, have previously for their roles in the robbery and are awaiting sentencing. They each face up to 25 years in prison. Miller and Glenn face additional penalties for related firearms offenses. They all remain in custody pending those hearings.

Mosley’s sentencing is set for Dec. 4, 2018, before U.S. District Judge Nancy Atlas. At that time she faces up to 25 years in prison. She was permitted to remain on bond pending that hearing.

The Houston Police Department and the FBI conducted the investigation as part of the Houston Law Enforcement Violent Crime Initiative. Assistant U.S. Attorneys Jill Stotts and Celia Moyer prosecuted the case.

HOUSTON – A local woman has been ordered to federal prison following her conviction of 12 counts of mail and wire fraud and four counts of filing a false tax return, announced U.S. Attorney Ryan K. Patrick. Gwendolyn M. Berry pleaded guilty Feb. 5, 2018.

Today, U.S. District Judge Gray Miller handed Berry a 51-month sentence to be immediately followed by three years of supervised release. Berry was ordered to pay $1,820,858.40 in restitution to her fraud victims and an additional $344,268 in restitution to the IRS.

At the hearing, Judge Miller determined Berry used sophisticated means in carry out her scheme to defraud and abused her position of trust. In handing down the sentence, the court noted that Berry engaged in this criminal activity over many years and took measures to conceal her misappropriation of funds.

Berry embezzled more than $1.8 million from a family’s bank accounts by writing checks on their accounts to pay her personal bills and those of family members.

Berry also pleaded guilty to filing  false federal tax returns for the tax years 2011 through 2014. In each of those tax returns, Berry omitted reporting the money she embezzled from her victims.

Berry 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. Secret Service and IRS - Criminal Investigation conducted the investigation. Assistant U.S. Attorney Melissa Annis is prosecuting the case.

LAREDO, Texas – A 19-year-old Laredo woman has been ordered to federal prison following her conviction of conspiracy to import methamphetamine, cocaine and heroin from Mexico, announced U.S. Attorney Ryan K. Patrick. Valeria Yazmin Santos-Perez pleaded guilty April 25, 2018. 

Today, U.S. District Judge Marina Garcia-Marmolejo handed Santos-Perez a 60-month sentence to be immediately followed by three years of supervised release. Before sentencing Santos-Perez, the court asked her if she had given any thought to the harm that would be caused by bringing a large quantity of narcotics into the United States.  Santos-Perez admitted she had not given that any thought

At the time of her plea, Santos-Perez admitted to driving a Mercedes-Benz SUV across the Lincoln-Juarez Bridge with bundles of narcotics hidden beneath the center console and beneath the floorboards of the vehicle. She said she had smuggled narcotics in a similar manner once previously and was paid $6,000 to drive the vehicle to Fort Worth.

Customs and Border Protection (CBP) agents spent several hours extracting all the narcotics from the vehicle. The total included nine bundles of cocaine with a gross weight of 9.54 kilograms, two bundles of brown heroin with a gross weight of 1.22 kilograms, five bundles of black tar heroin with a gross weight of 1.16 kilograms and 168 bundles of methamphetamine with a gross weight of 19.04 kilograms.

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.

Immigration and Customs Enforcement’s Homeland Security Investigations and CBP conducted the investigation. Assistant U.S. Attorney Michael Bukiewicz is prosecuting the case.

CORPUS CHRISTI, Texas – Three Mexican nationals have been sentenced for conspiring to import 611 kilograms of marijuana into the United States, announced U.S. Attorney Ryan K. Patrick. Julio Cesar Cruz-Amaro, 31, Tito Mar-Herrera, 35, and Miguel Angel Ender-Diaz, 56, pleaded guilty March 1, 2018, for their involvement in conspiring to import marijuana into the United States while on board a vessel.

Today, U.S. Circuit Judge Gregg Costa, sitting by designation, sentenced Cruz-Amaro to a 60-month-term of imprisonment, while Mar-Herrera and Ender-Diaz both received terms of 36 months. Not U.S. citizens, all are expected to face deportation proceedings following their sentences.

On Dec. 13, 2017, authorities detected and captured a Mexican lancha boat crew illegally transporting narcotics while in federal waters off southern Texas. Cruz-Amaro, Mar-Herrera and Ender-Diaz were interdicted in the vicinity of Packery Channel near Port Aransas along with one lancha and 30 bales of marijuana totaling 611 kilograms. 

U.S. Coast Guard (USCG) originally detected the vessel offshore traveling northbound towards the United States which was then intercepted with the assistance of Custom and Border Protection (CBP) approximately nine nautical miles offshore. 

They had admitted a criminal organization hired them to bring the drugs into the United States through Corpus Christi.

A lancha is a fishing boat used by Mexican fishermen that is approximately 20-30 feet long with a slender profile, typically has one outboard motor and is capable of traveling at speeds exceeding 30 mph.

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

USCG conducted the investigation with the assistance of CBP. Former Assistant U.S. Attorney (AUSA) Jeffrey S. Miller and AUSA David Paxton prosecuted the case.

LAREDO, Texas – A 27-year-old resident of Guadalajara, Jalisco, Mexico, has been ordered to prison for importing methamphetamine into the United States, announced U.S. Attorney Ryan K. Patrick. Leonardo Daniel Ramirez-Gallegos pleaded guilty May 1, 2018, to conspiracy to import fifty grams or more of methamphetamine.

Today, District Judge Marina Garcia Marmolejo sentenced Ramirez-Gallegos, to 70 months in prison. Not a U.S. citizen, he is expected to face deportation proceedings following his imprisonment. In handing down the sentence, the court noted Ramirez-Gallegos was entrusted with a substantial amount of methamphetamine and that he chose to bring along his five-year-old son while committing this crime.

On Feb. 25, 2018, Ramirez-Gallegos applied for entry into the United States at the Colombia Bridge Port of Entry near Laredo driving a 2003 Honda Odyssey. His wife and small child were accompanying him.

Customs and Border Protection (CBP) officers conducted an inspection and found approximately 13.55 kilograms of methamphetamine hidden in a trap door within each of the interior sliding doors of the Odyssey.

Ramirez-Gallegos had instructed his wife to lie to authorities if they were interviewed at the border. Ultimately, however, Ramirez-Gallegos admitted to knowingly importing the 16 bundles of methamphetamine into the United States.

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.

Immigration and Customs Enforcement’s Homeland Security Investigations conducted the investigation with the assistance of CBP. Special Assistant U.S. Attorney Lisa M. Ezra prosecuted the case.

LAREDO, Texas – A 30-year-old Mexican resident has been ordered to federal prison following his conviction of conspiring to import and importing nearly 15 kilograms of heroin, announced U.S. Attorney Ryan K. Patrick. Nestor Omar Dueñas-Jimenez, of Villa de Alvarez, Colima, Mexico, pleaded guilty May 1, 2018.

Today, U.S. District Judge Marina Garcia Marmolejo handed Dueñas-Jimenez a 63-month sentence. Not a U.S. citizen, he is expected to face deportation proceedings following the sentence. In handing down the sentence, the court noted that given his education and background, Dueñas-Jimenez should have known better.

Dueñas-Jimenez is licensed to practice law in Mexico.

On March 4, 2018, Dueñas-Jimenez applied for admission into the United States from Mexico via the Lincoln-Juarez International Bridge driving a Chevrolet Cruze. Customs and Border Protection (CBP) officers referred him to secondary inspection, during which time they discovered 14.66 kilograms of heroin hidden in his vehicle.

At the hearing, Dueñas-Jimenez said he tried smuggling the narcotics because he wanted money to buy a new car.

Authorities estimate the drugs have a street value of $450,000. 

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.

Customs and Border Protection and Immigration and Customs Enforcement’s Homeland Security Investigations conducted the investigation. Assistant U.S. Attorney Giselle S. Guerra prosecuted the case. 

CORPUS CHRISTI, Texas – A 19-year-old Corpus Christi resident has been ordered to federal prison following his conviction for conspiracy to possess with intent to distribute synthetic cannabinoids and discharging a firearm in relation to a drug trafficking offense, announced U.S. Attorney Ryan K. Patrick. Moises Alvarado pleaded guilty May 16, 2018.

Today, Senior U.S. District Judge John D. Rainey sentenced Alvarado to 108 months for the synthetic cannabinoid offense as well as a 120-month consecutive term for discharging a firearm in relation to a drug trafficking crime. The total 228-month prison term will be immediately followed by three years of supervised release. 

On Nov. 15, 2017, Corpus Christi Police Department (CCPD) officers responded to a drive-by shooting in the 400 block of Breckenridge in Corpus Christi. Upon arrival,  officers discovered that gunfire had struck a woman and child inside the residence. At the scene, officers recovered a total of 47 shell casings from two different caliber assault rifles.

Two days later, CCPD responded to an accidental shooting that occurred in the 5800 block of Weber Road in Corpus Christi. At that time, they discovered that Alvarado had been shot and that Librado Esquivel, 24, and Henrey Ayala III, 26, both of Corpus Christi, dropped him off at a local urgent care center.

As part of the investigation, the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) and CCPD SWAT Team executed search warrants at area residences on Dec. 7, 2017. At that time, law enforcement arrested Esquivel on a criminal complaint and seized several firearms, multiple rounds of ammunition, firearm parts and magazines, U.S. currency and multiple packages of synthetic cannabinoids. Ayala was arrested on a criminal complaint the following week.           

As a result of the federal investigation, agents determined Esquivel was a large supplier and distributor of synthetic cannabinoids in the area and was owed a debt related to his drug trafficking. Ayala and Alvarado agreed to commit the shooting and were promised a quantity of synthetic cannabinoids among other things as payment.

Ayala and Esquivel also pleaded guilty to conspiracy to possess with intent to distribute synthetic cannabinoids and discharging a firearm in relation to a drug trafficking offense and are set for sentencing before Judge Rainey on Sept. 17, 2018.

Synthetic cannabinoids are chemical compounds that mimic the psychoactive ingredient in marijuana. These chemical compounds can be applied to carrier mediums such as plant material and ingested using rolling papers, pipes, vaporizers or otherwise taken orally. Synthetic cannabinoids are usually sold in small, foil or plastic bags containing dried leaves (resembling potpourri) and is marketed as incense that can be smoked. It is commonly sold and known on the street as synthetic marijuana, fake weed, legal and by its popular brand names such as Spice, K2, Kush, Klimaxx and many others.

Alvarado will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be designated in the near future. Ayala and Esquivel are also in custody.

ATF, HSI and CCPD conducted the investigation with the assistance of the Drug Enforcement Administration. Assistant U.S. Attorney Lance Watt is prosecuting the case.

CORPUS CHRISTI, Texas – A 35-year-old Corpus Christi resident has been ordered to federal prison following his conviction for possession with intent to distribute synthetic cannabinoids and possessing a firearm during a drug trafficking offense, announced U.S. Attorney Ryan K. Patrick. Andrew Hernandez pleaded guilty Feb. 20, 2018.

Today, Senior U.S. District Judge John D. Rainey sentenced Hernandez to 70 months for the synthetic cannabinoid offense as well as a 60-month consecutive term for possession of a firearm in furtherance of a drug trafficking crime. The total 130-month prison term will be immediately followed by five years of supervised release. 

On Feb. 27, 2017, Hernandez was arrested at a local restaurant in Corpus Christi for an outstanding felony warrant. As he was taken into custody, officers removed a loaded .380 caliber handgun from his pocket. As a previously convicted felon, Hernandez is prohibited from possessing firearms and ammunition per federal law. At the time of arrest, officers also discovered several thousand dollars in U.S. currency and 72 packets of synthetic cannabinoids. Laboratory analysis confirmed the presence of FUB-AMB, which is controlled under the Controlled Substance Analog Act.

Synthetic cannabinoids are chemical compounds that mimic the psychoactive ingredient in marijuana. These chemical compounds can be applied to carrier mediums such as plant material and ingested using rolling papers, pipes, vaporizers or otherwise taken orally. Synthetic cannabinoids are usually sold in small, foil or plastic bags containing dried leaves (resembling potpourri) and is marketed as incense that can be smoked. It is commonly sold and known on the street as synthetic marijuana, fake weed, legal and by its popular brand names such as Spice, K2, Kush, Klimaxx and many others.

Hernandez was taken into federal custody in December 2017 as part of Operation City Shield, a coordinated federal, state and local law enforcement operation designed to identify violent offenders, stop gun violence and protect the community.

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

The Corpus Christi Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives conducted the investigation. Assistant U.S. Attorney Lance Watt is prosecuting the case.

CORPUS CHRISTI, Texas - A 37-year-old Corpus Christi man has been ordered to prison following his admissions to distributing child pornography on at least two occasions, announced U.S. Attorney Ryan K. Patrick. David Medina pleaded guilty May 16, 2018.

Today, Senior U.S. District Judge John D. Rainey sentenced Medina to 102 months in prison. In imposing the sentence, the court noted Medina “needs help” and considered victim impact letters detailing the effect of the continued distribution of images depicting how they were sexually abused as children. Medina was further ordered to serve 10 years of supervised release following completion of his prison term, during which time he will have to comply with numerous requirements designed to restrict his access to children and the internet. Medina will also be ordered to register as a sex offender.

In September 2016, the FBI Child Exploitation Task Force conducted an investigation on a file sharing network looking for potential offenders sharing child pornography. An officer was eventually able to download many images of child pornography from a computer and a specific IP address linked to David Medina in Corpus Christi. Agents obtained a search warrant for Medina’s residence, after which agents seized several digital devices that led to the discovery of more than 3,500 images and 28 videos of child pornography.  

Another investigation in 2017 led authorities to a different computer sharing child pornography which was traced to a second residence in Corpus Christi linked to Medina. He cellular phone was seized and allegedly found to contain more than 1,000 images and 95 videos of child pornography.

In Feb. 21, 2018, authorities received information that someone was downloading child pornography at a hotel in Corpus Christi. Medina was found to be renting a room at that location and seized his laptop as part of the investigation. At that time, Medina again admitting to distributing child pornography.

He has been an 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 with the assistance of the Corpus Christi Police Department - Internet Crimes Against Children Task Force.

Assistant U.S. Attorney (AUSA) Hugo R. Martinez prosecuting the case. AUSA Brittany Jensen handled the sentencing on this matter, 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 33-year-old South Texas man has been ordered to federal prison for participating in a conspiracy to sell crystal methamphetamine and using a firearm to facilitate that crime, announced U.S. Attorney Ryan K. Patrick. Joshua Caskey, of Alvin, pleaded guilty May 14, 2018. 

Today, Senior U.S. District Court Judge John D. Rainey sentenced Caskey to 235 months in federal prison. At the hearing, the court noted Caskey has six prior felony convictions involving drug possession and forgery.

Officers with the Houston Police Department (HPD) encountered Caskey in April 2017 during an ongoing narcotics investigation. At the time of his arrest, he was in possession of a duffle bag containing more than five pounds of crystal methamphetamine, 44 grams of PCP, seven grams of heroin, a stolen 9 mm firearm and more than $10,000 in cash.

The investigation led to the connection of that methamphetamine and cash to a known drug trafficking organization operating from Corpus Christi to Houston.

Ultimately, authorities arrested seven people and seized multiple firearms and large amounts of crystal methamphetamine. The remaining defendants have all been convicted and are awaiting sentencing.

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

The Drug Enforcement Administration and Immigration and Customs Enforcement’s Homeland Security Investigations conducted the investigation with the assistance of police departments in Corpus Christi and Houston. Assistant U.S. Attorney Brittany Jensen prosecuted the case.

HOUSTON – A 25-year-old man from Rosenberg has been sent to federal prison for nearly 40 years following his convictions of sexual exploitation of a child, distribution and possession of child pornography, announced U.S. Attorney Ryan K. Patrick. Ryan Glen Colburn pleaded guilty April 19, 2017.

Today, U.S. District Judge Nancy F. Atlas sentenced him to 360 months for the production of child pornography (sexual exploitation of a child). He also received 28 and 60 months for the possession and distributions convictions, respectively. The sentences will run consecutively for a total 448-month prison term. In handing down the sentence, Judge Atlas considered the fact that Colburn was a creator of child pornography and had a very large collection of child pornography. Colburn was further ordered to pay restitution to three known victims and will serve 15 years of supervised release following completion of his prison term, during which time he will have to comply with numerous requirements designed to restrict his access to children and the internet. He will also be ordered to register as a sex offender.

Colburn first came to the attention of law enforcement after he had sent images of child pornography to another individual who had been arrested for child pornography. Federal agents executed a search warrant at Colburn’s residence and performed a forensic examination on his computer. This exam showed Colburn was in possession of more than 1,100 images and 200 videos of young children engaged in sexually explicit conduct which included children under the age of 12, bondage and acts of violence. Some of the images are of known victims as identified through the National Center for Missing and Exploited Children.

Further, Colburn produced 25 images and six videos of a two-year-old minor which would constitute child pornography.

Agents also executed a search warrant on Colburn’s Dropbox account which contained more than 60 images and 400 videos of child pornography. 

At the time of his plea, Colburn admitted to taking sexually explicit photographs and videos of a two-year-old minor. Colburn further admitted he traded these images with other individuals online. 

He 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 Investigations conducted the investigation.

This case, prosecuted by Assistant U.S. Attorney Kimberly Ann Leo, 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 40-year-old Donna resident has been ordered to federal prison following her conviction of conspiring to transport two illegal aliens – a minor female and an adult registered sex offender, announced U.S. Attorney Ryan K. Patrick. Josie Arredondo pleaded guilty May 14, 2018.   

Today, Senior U.S. District Judge John D. Rainey handed Arredondo a 21-month sentence to be immediately followed by two years of supervised release. At the hearing, the court heard how Arredondo had been previously convicted for the same type of offense in 2011. At that time, she had also been attempting to smuggle an undocumented female child.

In this case, authorities encountered Arredondo at the Falfurrias Border Patrol checkpoint attempting to smuggle an undocumented four-year-old child along with the undocumented registered sex offender as passengers in her vehicle. Also inside the vehicle were her minor daughter and grand-daughter.

Arredondo claimed she was travelling to Houston to attend a funeral and took the undocumented girl and man along with her. She expected $1,000 in return for transporting them.

She was permitted to remain on bond and voluntarily surrender at a later date.

Border Patrol conducted the investigation. Assistant U.S. Attorney Brittany L. Jensen is prosecuting the case.

LAREDO, Texas – A Mexican man has been sent to federal prison for illegally re-entering the United States after he was deported, announced U.S. Attorney Ryan K. Patrick. Teodolfo Vega-Hernandez, 47, pleaded guilty to illegal re-entry after deportation March 29, 2018.

Today, District Judge Marina Garcia Marmolejo sentenced Vega-Hernandez, of Tultitlan, Estado de Mexico, Mexico, to 63 months in prison. On supervised release following his previous conviction of illegal re-entry, Vega-Hernandez received an additional 12-month sentence, three of which to be served consecutively for a total 66-month-term of imprisonment.

This marks the fourth time Vega-Hernandez has been convicted of illegally re-entering the United States following deportation. He was previously convicted Aug. 7, 2007, Nov.  18, 2009, and June 12, 2013. The court noted he was also previously convicted of a felony - driving while intoxicated - in Austin on April 14, 2005, following multiple convictions that spanned many years of driving while intoxicated, public intoxication and assault. He was ordered to be deported following those sentences, but continued to illegally re-enter the United States. After his third conviction June 12, 2013, he served 36 months in prison and was again ordered deported to Mexico Aug. 21, 2017.

However, on Jan. 12, 2018, Border Patrol (BP) found Vega-Hernandez again illegally present in the United States near Hebbronville. He had no legal documents to enter, travel through or remain in the United States.

He is again expected to face deportation proceedings following his release from prison.

Customs and Border Protection and BP conducted the investigation. Special Assistant U.S. Attorney Lisa M. Ezra prosecuted the case.

HOUSTON – A 59-year-old Sugar Land man has admitted to conspiring to commit health care fraud through Medicare ambulance claims, announced U.S. Attorney Ryan K. Patrick.

Anthony Chukwudi Nwosah is the owner of Tonieann EMS and Rosenberg EMS. Today, he admitted he conspired to submit more than $3 million in false and fraudulent claims to Medicare for ambulance transport services that were not provided and not medically necessary. Nwosah received approximately $1,094,260 as payment for those claims.

Nwosah admitted he submitted the ambulance claims for Medicare beneficiaries transported by vans, not ambulances, to routine psychotherapy appointments and for at least one other beneficiary who did not require ambulance transportation. Nwosah also admitted he instructed a licensed emergency medical technician (EMT) to create fake ambulance transport records which included fake vital signs, patient narratives and transport mileage. Additionally, he admitted that more than 2,000 fake ambulance transport records contained the name of another EMT who never worked for him.

The Medicare program requires ambulance providers to sign an enrollment application that expressly states the provider will not knowingly submit false or fraudulent claims to Medicare or claims with deliberate ignorance or reckless disregard for their truth or falsity. The Medicare program only intended to pay for ambulance services that were provided and medically necessary. Medicare did not intend to pay for ambulance services provided by vans or taxis or for beneficiaries who, at the time of transportation, could safely be transported by other means.

U.S. District Judge Lynn Hughes accepted the plea and has set sentencing for Nov. 19, 2018. At that time, Nwosah faces up to 10 years in federal prison and a $250,000 fine.

He was permitted to remain on bond pending that hearing.

The Department of Health and Human Services – Office of the Inspector General and the FBI conducted the investigation. Assistant U.S. Attorney Julie Redlinger prosecuted the case.

HOUSTON – A 26-year-old man has been sentenced to federal prison following his conviction for attempting to maliciously damage property receiving federal financial assistance, announced U.S. Attorney Ryan K. Patrick. Andrew Schneck pleaded guilty March 27, 2018.

Today, U.S. District Judge Ewing Werlein Jr. handed Schneck a 78-month sentence to be immediately followed by three years of supervised release. The court also imposed a $10,000 fine.

On the evening of Aug. 19, 2017, a Houston park ranger observed Schneck kneeling among the bushes in front of the General Dowling Monument located in Hermann Park in Houston. Schneck was holding two small boxes with various items inside to include what appeared to be duct tape and wires. After placing the boxes on the ground per the ranger’s request, Schneck took a drink of clear liquid from a plastic bottle, spit it out and poured the remainder on the ground. The ranger then noticed a timer and wires in the box and notified the Houston Police Department (HPD).

The HPD Bomb Squad tested the clear liquid and a white powdery substance found in a small, black aluminum tube which revealed they were nitroglycerin and hexamethylene triperoxide diamine (HMTD), respectively. HMTD is a high explosive organic compound used as an initiating, or primary, explosive. Nitroglycerin is used as an active ingredient in the manufacture of explosives. ln its pure form, nitroglycerin is a contact explosive with physical shock causing it to explode and which degrades over time to even more unstable forms. Nitroglycerin is highly dangerous to transport or use.

The FBI Explosive Unit Laboratory examined the items in Schneck’s possession on Aug. 19 and determined them to comprise a fully functioning improvised explosive device.

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

The FBI and HPD conducted the investigation. Assistant U.S. Attorneys S. Mark McIntyre and Craig M. Feazel are prosecuting the case.