Western District of Texas

A Richardson, TX, man faces up to life in federal prison after a federal jury in San Antonio convicted him this morning for plotting with his uncle to kill his uncle’s intimate partner announced United States Attorney Robert Pitman, FBI Special Agent in Charge Christopher H. Combs, San Antonio Division, and United States Marshal Robert Almonte.

Jurors convicted 29-year-old Leonard Roundtree, III, of one count of conspiracy to commit murder.  Evidence presented during trial revealed that on June 10, 2013, Roundtree’s uncle, 52-year-old Alvin Leon Roundtree of San Antonio, shot and wounded his intimate partner with a .45 caliber handgun inside the Medical Training Facility located on Fort Sam Houston Army Post.  The victim, who suffered a total of seven gunshot wounds, was immediately taken into surgery and survived the incident.  Authorities subsequently apprehended Roundtree while still on Fort Sam Houston and recovered the firearm.

During the trial, recorded phone calls between Leonard Roundtree and his uncle revealed that the two conspired to hire someone to kill Alvin’s intimate partner to prevent her testimony in the upcoming federal trial.  The evidence revealed that Leonard Roundtree agreed to, and in fact did, deliver information between his uncle and the hitman ultimately agreeing to pay $10,000 upon proof the murder.

“Leonard Roundtree facilitated the murderous plot that his uncle initiated.  Fortunately, the crime was thwarted and the victim did not suffer additional harm.  Roundtree’s participation in the crime revealed callous disregard for human life and he will pay a severe penalty for his conduct,” stated U.S. Attorney Robert Pitman.

Leonard Roundtree is scheduled to be sentenced on August 1, 2014.  In March, Alvin Roundtree pleaded guilty to one count of assaulting an officer or employee of the United States with a deadly weapon and is awaiting sentencing scheduled for September 12, 2014.  Alvin Roundtree still faces two counts of conspiracy to commit murder.

“The collective investigative efforts of Army Criminal Investigative Division, United States Marshals Service, San Antonio Police Department and the FBI came together in this case and stopped a plot from becoming a violent and cold blooded murder of a victim and witness in a criminal prosecution,” stated FBI SAC Christopher Combs.

“I am extremely proud of the collaborative work done by our task force and I am also pleased with the jury’s guilty verdict,” stated U.S. Marshal Robert Almonte.

Assistant United States Attorneys Bettina Richardson and Joey Contreras are prosecuting this case on behalf of the Government.

In Del Rio this afternoon, 25-year-old Julia Esmeralda Garza of  Eagle Pass, TX, was sentenced to 11 months in federal prison followed by three years of supervised release for her role in a fraudulent kidnapping scheme announced United States Attorney Robert Pitman and Federal Bureau of Investigation Acting Special Agent in Charge Aaron C. Rouse, San Antonio Division.

According to court records, on May 8, 2013, Garza used her cellphone to make phone calls and send text messages to a friend in attempt to obtain approximately $700 in ransom money.  During the scheme, Garza fraudulently claimed that she had been kidnapped, threatened and was being held against her will in Mexico.  The friend notified local police of the potential kidnapping. On November 20, 2013, Garza pleaded guilty to one count of wire fraud.

“This case demonstrates the FBI’s commitment to investigate and seek prosecution of individuals, who participate in fraudulent schemes, which compromise public safety by diverting valuable law enforcement resources away from true victims,” stated FBI ASAC Rouse.

This matter was investigated by the Federal Bureau of Investigation together with Eagle Pass Police Department.  Assistant United States Attorney Lewis Thomas prosecuted this case on behalf of the Government.

In Waco this afternoon, 41-year-old former U.S. Army sergeant Gary Allen Burgess was sentenced to 340 months in federal prison for production of child pornography announced United States Attorney Robert Pitman and Federal Bureau of Investigation Acting Special Agent in Charge Aaron C. Rouse, San Antonio Division.

In addition to the prison term, U.S. District Judge Walter S. Smith, Jr. ordered that Burgess pay a $1,000 fine and $80,000 restitution to his victim.  Judge Smith also ordered that Burgess be placed under supervised release for a period of eight years after completing his prison term.

On June 6, 2013, Burgess pleaded guilty to one count of production of child pornography.  According to court records, in late 2011, U.S. Army Criminal Investigation Division authorities executed a search authorization at the defendant’s residence on Fort Hood based on a report of a sexual assault of a minor.  A forensic examination of various seized electronic media which belonged to the defendant revealed the presence of approximately 80 sexually explicit images involving an individual under the age of 12.

Burgess has remained in federal custody since his arrest in December 2012.

In October 2013, Burgess’ wife, Caroline, was sentenced to two years in federal prison followed by one year of supervised release and ordered to pay a $1,000 fine after pleading guilty to one count of tampering with a witness, victim or informant.  According to court records, in March 2012, Caroline Burgess attempted to persuade a minor victim in this case to recant allegations of sexual abuse against Gary Burgess.  

This matter was investigated by the Federal Bureau of Investigation together with the U.S. Army Criminal Investigation Division.  Assistant United States Attorney Greg Gloff prosecuted this case on behalf of the Government.

In Austin, 67-year-old President and Chief Executive Officer of Image Trends, Inc. Daniel J. Sullivan faces up to ten years in federal prison after pleading guilty earlier today to one count of possession of child pornography announced United States Attorney Robert Pitman and Homeland Security Investigations (HSI) Special Agent in Charge Janice Ayala.

In March 2012, HSI agents executed a search warrant at the defendant’s residence and business. A subsequent forensics examination of seized computer related items revealed the presence of approximately 600 images and 90 videos depicting child pornography.

Sullivan remains on bond pending sentencing.  No sentencing date has been scheduled.

Assistant United States Attorney Matt Devlin is prosecuting this case on behalf of the Government.

Marcelo Alvarez, a 55-year-old surveyor and consultant from Eagle Pass, faces up to ten years in federal prison and full restitution to Maverick County after pleading guilty to a bribery charge in connection with an alleged bribery, kickback and bid-rigging scheme announced United States Attorney Robert Pitman and Acting FBI Special Agent in Charge Aaron C. Rouse.
               
Appearing before United States District Judge Alia Moses this afternoon in Del Rio, Alvarez pleaded guilty to one count of paying a bribe to an agent of an organization receiving federal funds.  According to court documents, between 2010 and 2012, Alvarez paid $100 to $200 on multiple occasions to Maverick County elected officials, including two county commissioners, for their support in securing county construction projects.  Ultimately, Maverick County paid in excess of $800,000 to Amistad Consulting, a company which Alvarez was connected to, to perform engineering, project management and consulting services for the county.  Alvarez, designated by Amistad Consulting  as the Resident Project Representative, received payment for his services of approximately $300,000 between 2010 and 2012. 

Alvarez remains on bond pending sentencing scheduled for October 1, 2014.

This ongoing investigation is being conducted by the Federal Bureau of Investigation and the Texas Department of Public Safety.  Individuals who have first-hand information about corruption, fraud, or bribery related to Maverick County are urged to contact the FBI at (210) 225-6741.  Assistant United States Attorneys Michael Galdo and Bryan N. Reeves are prosecuting this case on behalf of the Government.

In San Antonio this morning, United States Chief District Judge Fred Biery handed down prison sentences to two individuals for their roles in what is believed to be the largest real dollar loss fraud and tax related case ever prosecuted in the Western District of Texas announced United States Attorney Robert Pitman, Acting FBI Special Agent in Charge Aaron C. Rouse and IRS-Criminal Investigation Special Agent in Charge Steve McCollough. 

Larry Kimes, the manager of AccounTex Financial Services, LLC, was sentenced to 12 years in federal prison followed by three years of supervised release and ordered to pay $132 million restitution after pleading guilty to a Klein tax fraud conspiracy charge and a mail fraud conspiracy charge last month. 

Charles Pircher, manager of a series of Professional Employer Organizations (PEOs) based in San Antonio, including Service Professionals, was sentenced to 11 years in federal prison followed by three years of supervised release and ordered to pay $132 million restitution after pleading guilty to a Klein tax fraud conspiracy charge and a mail fraud conspiracy charge in November 2013.

“The sentencing of so-called ‘white collar’ defendants to significant terms of imprisonment such as the judge imposed in this case today should send a strong message to those who concoct fraudulent schemes - schemes that result in real losses to real people,” stated United States Attorney Robert Pitman.

In February, three other individuals who also entered guilty pleas in connection with this fraudulent scheme were sentenced to federal prison by Judge Biery.  John Bean, owner of Synergy Personnel, a Professional Employer Organization (PEO) based in San Antonio, as well as an agent, representative, officer, license holder and accountant of several San Antonio and Austin based PEOs, including Service Professionals; Pat Mire, owner and manager of several San Antonio-based PEOs, including Service Professionals; and, Mike Solis, an executive assistant at several San Antonio based PEOs, including Service Professionals, were sentenced to six years, three years and three years in federal prison, respectively.

By pleading guilty, the defendants admitted that between 2002 and 2008, they participated in a scheme in which they stole more than $130 Million from the clients of a series of PEOs operated by the defendants.  The PEOs entered into staff leasing agreements with various client companies to manage the companies’ payroll and insurance programs.  Kimes, Pircher and the other co-conspirators diverted to their own use and benefit clients’ monies that should have been paid for payroll taxes and insurance premiums.

“The defendants involved in this, the largest ever single criminal tax case in San Antonio's history, knowingly violated our country's Tax laws. They chose to ignore their responsibilities and live a lavish lifestyle on money belonging to their employees and to the U.S. Government. IRS Special Agents will continue to aggressively pursue these types of very serious tax crimes,” stated IRS-Criminal Investigation Special Agent in Charge Steve McCollough.

“Motivated by greed, the defendants perpetrated an extensive fraud scheme, designed to steal money from their clients and taxpayers over a number of years.  The FBI will continue to work with our partners to identify, investigate and prosecute others, like the defendants, who seek unjust enrichment by victimizing others,” stated FBI Acting Special Agent in Charge Aaron C. Rouse.

This case was investigated by agents with the Federal Bureau of Investigation and the Internal Revenue Service-Criminal Investigation.  Assistant United States Attorney Thomas J. McHugh prosecuted this case on behalf of the Government. 

In Austin today, 52-year-old Randall David Reed of Dripping Springs, TX, was sentenced to 15 years in federal prison for six robberies, including five banks and one grocery store, and brandishing a firearm during and in relation to a crime of violence announced United States Attorney Robert Pitman and Acting FBI Special Agent in Charge Aaron C. Rouse.

In addition to the prison term, United States District Judge Lee Yeakel ordered that Reed pay restitution totaling $32,430 and be placed under supervised release for a period of three years after completing his prison term. 

On February 5, 2014, Reed pleaded guilty to five counts of bank robbery, one count of violating the Hobbs Act (robbery which affects interstate commerce), and the firearm charge.  According to court records, Reed admitted that he committed the following robberies:

• February 28, 2013 -- Randalls grocery store (2000 block of West Ben White Blvd. in Austin) – $3,000
• March 25, 2013 – Pioneer Bank (100 block of Wonder World Dr. in San Marcos) – $8,312
• May 3, 2013 – Prosperity Bank (12000 block of Research Blvd. in Austin) – $2,200
• May 21, 2013 – Northstar Bank (1500 block of West 35th St. in Austin) – $3,552
• July 3, 2013 – Broadway Bank (13400 block of US Hwy 281 in San Antonio) – $1,500
• July 26, 2013 – Benchmark Bank (1500 block of West 35th St. in Austin) -- $13,866

Furthermore, Reed admitted to carrying a handgun during all of the robberies and even brandishing a handgun during the July 26, 2013, robbery.

This case was investigated by agents with the Federal Bureau of Investigation and the police departments from Austin, San Marcos and San Antonio.  Assistant United States Attorney Matthew B. Devlin prosecuted this case on behalf of the Government. 

This morning, 63-year-old El Paso commercial truck driver Rogelio Munoz Chavarria was sentenced to four months in federal prison followed by two years of supervised release and fined $2,000 for his role in an undocumented alien smuggling scheme announced United States Attorney Robert Pitman and Homeland Security Investigations Special Agent In Charge Dennis Ulrich.

Chavarria’s sentencing comes one day after U.S. District Judge Philip R. Martinez sentenced co-defendant and ringleader Refugio Aide Diaz Martinez, a 45-year-old Mexican National who had been residing illegally in the Dallas area, to six years in federal prison and ordered her to pay a $12,500 fine.  In February, Diaz’s husband and co-ringleader, 46-year-old Robert “Beto” Perez, Jr. of Dallas, was sentenced to eight years in federal prison and fined $15,000 for his role in the scheme.  All three had previously pleaded guilty to conspiracy to smuggle undocumented aliens for financial gain. 

According to court records, since September 2008, Diaz, Perez, Chavarria and 12 other convicted individuals were involved in an alien smuggling ring based in Dallas, Texas.  This organization was responsible for the smuggling, transporting and harboring of more than 150 undocumented aliens, including at least 18 minors, through the El Paso/Juarez corridor.  Sentences handed down thus far in this case range from probation to eight years in federal prison.

Two other commercial truck drivers--51-year-old Lazaro Echeverria of Miami Gardens, FL, and 46-year-old Cesar Delgadillo of Hesperia, CA—are scheduled for sentencing on April 23, 2014, and May 14, 2014, respectively.  Each faces up to ten years in federal prison for conspiring to smuggle undocumented aliens for financial gain.

This investigation was conducted by Homeland Security Investigations (HSI). Assistant United States Attorney Patricia Aguayo is prosecuting this case on behalf of the Government.

In San Antonio, 58-year-old Antonio Pena-Arguelles, a citizen of Mexico, was sentenced to 30 months in federal prison for his role in a money laundering conspiracy announced United States Attorney Robert Pitman of the Western District of Texas, United States Attorney Kenneth Magidson of the Southern District of Texas, Acting Drug Enforcement Administration Special Agent in Charge Steven S. Whipple, Houston Division, Internal Revenue Service-Criminal Investigation Special Agent In Charge Steve McCollough, Homeland Security Investigations Special Agent In Charge Janice Ayala and Texas Attorney General Greg Abbott. 

Appearing before U.S. District Judge Orlando Garcia this afternoon, Pena-Arguelles pleaded guilty to a one-count Superseding Information filed today charging him with conspiracy to commit money laundering.  In addition to the prison sentence imposed, Pena-Arguelles agreed to forfeit to the federal government approximately $5.5 million in U.S. currency and real estate property. 

Pena-Arguelles remains in federal custody.

This matter was investigated by the DEA, IRS-Criminal Investigation, HSI and the Texas Attorney General’s Office and prosecuted with the assistance of the United States Attorney’s Office for the Southern District of Texas. 

In Midland this afternoon, 26-year-old Aryan Circle member Kevin Dwain Rickman (a.k.a. “Birdie”) of Midland, was sentenced to life in federal prison for distributing methamphetamine and retaliating against a witness announced United States Attorney Robert Pitman and FBI Special Agent in Charge Douglas E. Lindquist, El Paso Division.

On September 23, 2013, Rickman pleaded guilty to one count of conspiracy to possess with intent to distribute methamphetamine and one count of retaliating against a witness or victim. By pleading guilty, Rickman admitted that between June 2005 and June 2013, he and others conspired to distribute ounce quantities of methamphetamine in the Permian Basin area. Rickman also admitted that on May 5, 2013, he knowingly caused bodily injury to an individual for providing information to law enforcement.

“Today’s sentencing of Mr. Rickman, a documented Aryan Circle member, serves as a strong message to the community of Midland and Odessa that the FBI is committed to pursue individuals who have violated the law and hold them accountable for their illegal actions. This sentencing concludes an 18-month investigation by the FBI, Odessa Police Department, Midland County and the Ector County Sheriff’s Department and furthers the partnership between law enforcement agencies in combating violent criminal offenders,” stated FBI SAC Lindquist.

Former Sabinal (TX) police officer Jason Lee Villasana will serve 15 years in federal prison followed by ten years of supervised release after pleading guilty to distributing child pornography announced United States Attorney Robert Pitman and Federal Bureau of Investigation Acting Special Agent in Charge Aaron C. Rouse, San Antonio Division.

On August 21, 2013, Villasana, age 36, pleaded guilty to one count of distribution of child pornography.  According to court records, from May 2011 until November 15, 2012, Villasana received, stored and sent images and videos of minors engaged in sexually explicit conduct.   On November 15, 2012, FBI agents and investigators from the Texas Attorney General’s Law Enforcement Division executed a search warrant at the defendant’s residence and seized various electronic media belonging to the defendant.  A subsequent forensics examination of the seized items revealed the presence of approximately 250 images, seven videos and 64 thumbnail images of child pornography.

Villasana has remained in federal custody since his arrest on December 18, 2012.  The sentence was handed down yesterday afternoon in Del Rio by U.S. District Judge David A. Ezra.

This matter was investigated by the Federal Bureau of Investigation together with the Texas Attorney General’s Law Enforcement Division and Homeland Security Investigations (HSI).  Assistant United States Attorneys Meghan M. McCalla and Matthew Watters prosecuted this case on behalf of the Government.

In Austin, 64-year-old Lakeway resident Ricky Lynn Richardson faces up to five years in federal prison, a maximum $250,000 fine and restitution after pleading guilty this morning to stealing millions from pension plans announced United States Attorney Robert Pitman and Federal Bureau of Investigation Acting Special Agent in Charge Aaron C. Rouse, San Antonio Division.

Appearing before United States Magistrate Judge Andrew Austin, Richardson pleaded guilty to a one-count Information charging him with theft and embezzlement from an employee benefit plan.  According to authorities, from 1998 to 2013, Richardson stole approximately $4.3 million from four separate pension plans for which he provided administrative services.  During the scheme, Richardson, doing business as Benefit Consultants, Inc. in Spicewood, TX, secretly misdirected or misappropriated money that belonged to the plans and provided customers with false statements, leading them to believe they still had the retirement money. 

Richardson is out on bond pending sentencing.  No sentencing date has been scheduled.  The restitution amount in this case will be determined by the Court at sentencing.

This investigation was conducted by agents with Federal Bureau of Investigation and the Employees Benefits Security Administration of the Department of Labor.  Assistant United States Attorney Alan M. Buie is prosecuting this case on behalf of the Government.

This afternoon, 37-year-old former San Antonio Police Officer Curtis W. Lundy was sentenced to 18 months in federal prison followed by two years of supervised release for theft of honest services by wire fraud announced United States Attorney Robert Pitman, Federal Bureau of Investigation Acting Special Agent in Charge Aaron C. Rouse and San Antonio Police Chief William McManus.

According to court records, on December 15, 2012, then Officer Lundy responded to a call concerning an assault in progress at a Northside apartment complex.  At the scene, Lundy detained an individual in connection with the assault after that individual admitted to Lundy that he was in possession of a user amount of marijuana.  While the subject was detained, Lundy indicated that he would hold off on filing the possession of marijuana charge in exchange for a $400 payment.  During subsequent phone conversations, Lundy raised the payment to $500. 

The subject subsequently contacted the FBI and at the agency’s direction, the subject was able to make multiple audio recordings of cellular telephone conversations with Lundy.  During one of those conversations, Lundy instructed the subject to meet in order to collect the $500.  Surveillance observed Lundy, the sole occupant, arrive in a marked SAPD patrol vehicle and collect an envelope from the subject which contained $500.

Lundy pleaded guilty to the charge on October 10, 2013.

This case was investigated by agents with the Federal Bureau of Investigation together with San Antonio Police Department Internal Affairs.  Assistant United States Attorney Greg Surovic prosecuted this case on behalf of the Government.

In San Antonio this morning, 20-year-old Amber Doak pleaded guilty to her role in prostituting a 15-year-old female in August of last year announced United States Attorney Robert Pitman and Acting FBI Special Agent in Charge Aaron C. Rouse, San Antonio Division.

Appearing before United States Chief District Judge Fred Biery this morning, Doak pleaded guilty to one count of sex trafficking of children.  By pleading guilty, Doak admitted to knowingly enticing and encouraging a minor into engaging in sexual acts for money.  She also admitted to using a mobile phone provided by 38–year-old co-defendant Marcus Deshawn Wright to take pictures of the victim so that Wright and another co-defendant, 21-year-old Malcom Deandre Copeland of San Antonio, could use them to promote the minor on an Internet website which advertised prostitution services under the pretext of "escorts."  Furthermore, Doak admitted that she fielded inquiries from individuals responding to the prostitution advertisement on Backpage.com and also traveled with Wright and Copeland as they transported the victim to multiple locations to engage in commercial sex.

Doak, who remains in federal custody, faces between ten years and life in federal prison when she is sentenced by Judge Biery on September 12, 2014.

Copeland and Wright, who are also in federal custody, are set for jury selection and trial on April 7, 2014, before Judge Biery on the sex trafficking of children charge.

This case was investigated by the Federal Bureau of Investigation (FBI) together with the San Antonio Police Department.  Assistant United States Attorney Bettina Richardson is prosecuting this case on behalf of the Government.

A San Antonio man faces up to 20 years in federal prison after admitting to shooting his intimate partner multiple times on Fort Sam Houston Army Post in June 2013 announced United States Attorney Robert Pitman, Acting FBI Special Agent in Charge Aaron C. Rouse, San Antonio Division, and United States Marshal Robert Almonte.

Appearing before United States Chief District Judge Fred Biery this morning, 52-year-old Alvin Leon Roundtree pleaded guilty to one count of assaulting an officer or employee of the United States with a deadly weapon.  By pleading guilty, Roundtree admitted that on the afternoon of June 10, 2013, he entered Fort Sam Houston and proceeded to the Medical Training Facility where his intimate partner was an instructor.  After a verbal altercation regarding her decision to leave the defendant, Roundtree pulled out a .45 caliber handgun and began firing at his victim.

According to court records, the victim suffered a total of seven gunshot wounds.  The victim was immediately taken into surgery.  She survived the incident.  Authorities subsequently apprehended Roundtree while still on Fort Sam Houston and recovered the firearm.

Roundtree, who remains in federal custody, is scheduled to be sentenced by Judge Biery on September 12, 2014.

Roundtree’s nephew and co-defendant, 29-year-old Leonard Roundtree, Jr. of Richardson, TX, is awaiting his April 21, 2014, trial date on charges that he conspired with Alvin Roundtree to hire someone to kill Alvin’s intimate partner to prevent her testimony and in retaliation for providing information to law enforcement.  According to court records, Leonard Roundtree allegedly agreed to deliver a pre-payment of $1,000 to the individual solicited to commit the murder plus $9,000 more after the murder was carried out.

This case was investigated by the Federal Bureau of Investigation (FBI) together with the U.S. Army Criminal Investigation Division, United States Marshals Service and the San Antonio Police Department. Assistant United States Attorney Bettina Richardson is prosecuting this case on behalf of the Government.

Jose Luis Suarez, owner of Air One Mobile Welding Supply Company in Odessa, TX, faces up to 20 years in federal prison and full restitution after admitting to underpaying taxes owed to the federal government and the State of Texas announced United States Attorney Robert Pitman, Homeland Security Investigations Special Agent in Charge Dennis Ulrich and IRS-Criminal Investigation Special Agent in Charge Steve McCollough.

Appearing yesterday in Midland before United States Magistrate Judge David Counts, Suarez pleaded guilty to six counts of wire fraud and two counts of filing fraudulent federal Income Tax Returns.

By pleading guilty, Suarez admitted that he knowingly filed Income Tax Returns for 2011 and 2012 in which he did not include all of Air One’s gross receipts.  According to court records, Suarez still owes more than $151,000 in federal taxes for 2011 and more than $77,000 in federal taxes for 2012 according to an Internal Revenue Service assessment. 

Suarez, as company owner, was also ultimately responsible for all quarterly sales tax filings with the Texas Comptroller of Public Accounts.  According to court records, beginning on or about the first quarter of 2011, and continuing through at least the first quarter of 2013, Suarez intentionally devised a scheme to defraud the State of Texas of sales taxes collected by Air One in the course of its business, and properly owed to the State.  As part of this scheme, Defendant Suarez filed, or caused to be filed with the Texas Comptroller of Public Accounts a series of six Sales and Use Tax Returns that materially and fraudulently underreported the amount of taxable sales achieved by Air One.  The aggregate underpayment of sales taxes to the State of Texas by Air One is estimated by the Texas Comptroller of Public Accounts to be $264,314.03.

Suarez remains on bond pending sentencing.  No sentencing date has been scheduled.

This case was investigated by HSI and IRS-Criminal Investigation together with the Texas Comptroller of Public Accounts.  Assistant United States Attorney John Klassen is prosecuting this case on behalf of the Government.

In Austin, 53-year-old Veracruz, Mexico businessman Francisco Colorado Cessa, his son, 25–year-old Francisco Colorado Cessa, Jr., and a business associate, 52–year-old Ramon Segura Flores face up to five years in federal prison after pleading guilty to attempting to bribe a federal judge announced United States Attorney Robert Pitman, Federal Bureau of Investigation Acting Special Agent in Charge Aaron C. Rouse and Internal Revenue Service-Criminal Investigation Special Agent in Charge Steve McCollough. 

Appearing before United States Magistrate Judge Andrew Austin this morning, all three defendants pleaded guilty to one count of conspiracy to bribe a federal judge.  By pleading guilty, the defendants admitted to conspiring last year to pay a $1.2 million bribe to a federal judge in order to secure a reduced sentence for Colorado Cessa.  According to the criminal complaint filed in this case, at no time before or during this investigation was the judge involved in the alleged criminal activity.  Colorado Cessa is currently serving a 20-year federal prison term for his role in a complex scheme to launder millions of dollars in illicit Los Zetas drug trafficking proceeds to purchase, train, breed, and race American quarter horses in the United States. 

All three remain in federal custody at this time.  No sentencing date has been scheduled.

This case was investigated by the FBI and IRS-Criminal Investigation.  

Three Waco family members face federal drug distribution charges announced United States Attorney Robert Pitman.

A federal grand jury indictment, returned today in Waco, charges 58–year-old Phillip Larry Koss, his wife, 60-year-old Le’Ann Koss and his son, 26-year-old Conner Phillip Koss with one count conspiracy to possess with intent to distribute marijuana and one substantive count of aiding and abetting the possession with intent to distribute marijuana.

The indictment alleges that from October 2010 until November 2013, the defendants conspired to possess over 50 kilograms of marijuana.

On November 29, 2013, authorities executed a search warrant at the Koss’ residence and discovered approximately 12 pounds of tetrahydrocannabinol, commonly known as THC, several firearms and some $27,000 in U.S. Currency. Court records allege that the defendants obtain high grade marijuana from the State of California and arrange for it to be transported to their Waco residence for distribution. Authorities have also recovered approximately 200 pounds of marijuana resulting from related search warrants executed in California as well as traffic stops during this investigation.

Upon conviction, each charge calls for up to 20 years in federal prison. The defendants, who are in custody at this time, are scheduled to have an Initial Appearance in Waco at 2:00pm on March 20, 2014, before United States Magistrate Judge Jeffrey C. Manske.

This investigation is being conducted by the McGregor Police Department, Texas Department of Public Safety and the Yuba County (CA) Narcotics Enforcement Team. Assistant United States Attorney Mary F. Kucera is prosecuting this case on behalf of the Government.

An indictment is merely a charge and should not be considered as evidence of guilt. The defendants are presumed innocent until proven guilty in a court of law.

In San Antonio, seven individuals face federal charges in connection with an estimated $1.6 million wire fraud scheme announced United States Attorney Robert Pitman and FBI Acting Special Agent in Charge Aaron C. Rouse.

Charged in the indictment include:  46–year-old Boerne, TX, resident Lea Ann Blystone, owner and managing partner of HipDingo stores in San Antonio, Boerne and Fredericksburg and former marketing director for a land development company, Rinco of Texas, Inc. (Rinco), and Rockin’ J Ranch (Rockin’ J); her ex-husband and Rockin’ J contractor, 49-year-old Michael J. Webb of San Antonio; 48-year-old Rockin’ J contractor Karen Lindsay of Boerne; 56-year-old Boerne resident and Rockin’ J contractor Cheryl E. Hartsfield; 47-year-old Boerne resident and Rockin’ J contractor Roy E. Pokrant, Jr.; 47-year-old Boerne resident and Rockin’ J contractor Thomas J. Worsham; and, 47–year-old Rinco employee and HipDingo co-owner Manson Porter of Boerne.

The indictment, returned on March 5, 2014, and unsealed this afternoon, charges Blystone with eight counts of wire fraud, twelve counts of forged endorsements and two counts of witness tampering.  Porter is charged with three counts of wire fraud and two counts of witness tampering.  Each of the remaining defendants is charged with three counts of wire fraud.

According to the indictment, from January 2009 until August 2011, Blystone, with assistance from the other defendants, devised and implemented a scheme to defraud Rinco, Rockin’ J, Security State Federal Credit Union and others to obtain money and other property by means of false and fraudulent pretenses.  As marketing director for Rinco and Rockin’ J, Blystone coordinated staffing and vendor payments for promotional booths or display space at shows, malls, sporting and other events. 

In the scheme, Blystone caused Rinco and Rockin’ J to make checks payable based on numerous fraudulent third-party contractor invoices submitted which greatly overstated the actual operating costs of the promotional booths.  Blystone also caused Rinco and Rockin’ J to fraudulently pay defendants Webb, Lindsay, Hartsfield, Pokrant and Worsham for staffing the promotional displays.  In some instances, the indictment states that Rinco and Rockin’ J paid for services when no promotion had been done at all at a stated location, or for work performed for the benefit of Blystone and Porter at HipDingo.

Blystone allegedly forged the names of payees on the back of Rinco and Rockin’ J checks and deposited the proceeds into a bank account under her control.   Blystone also caused one or more of her fraudulently paid co-defendants to give her a portion of their illegally derived proceeds. The indictment further alleges that Blystone used money derived from her scheme for inventory acquisition and payroll at HipDingo.

The indictment also alleges that on two separate occasions during the investigation, Blystone and Porter tried to persuade an individual to provide false information or recant information already provided to FBI agents.

Furthermore, the indictment contains a notice for demand for asset forfeiture whereby the Government is seeking the criminally derived proceeds of the scheme, namely:  four real estate properties located in Boerne; all inventory, assets, bank accounts and equipment owned, held or maintained by HipDingo, LLC., Blystone and Porter; and, four vehicles.  The Government is also seeking a monetary judgment in this case in the amount of $1,597,708 representing the amount of proceeds traceable to the above mentioned scheme.

Upon conviction, each wire fraud and witness tampering charge call for up to 20 years in federal prison; each forged endorsement charge, up to ten years in federal prison.

These charges resulted from an investigation conducted by agents with the Federal Bureau of Investigation.  Assistant United States Attorney William R. Harris is prosecuting this case on behalf of the Government.

An indictment is merely a charge and should not be considered as evidence of guilt.  The defendants are presumed innocent until proven guilty in a court of law.

Bobby Edward Tubb, 31-year-old owner of Tubb Collision in Centerville, TX, will spend 51 months in federal prison for his involvement in the falsification and removal of vehicle identification numbers (VINs), announced United States Attorney Robert Pitman, Texas Department of Public Safety (DPS) Director Steven McCraw and Leon County Sheriff Kevin Ellis.  

In addition to the prison term handed down late yesterday afternoon in Waco, U.S. District Judge Walter S. Smith, Jr., ordered that Tubb pay a $1,000 fine and be placed under supervised release for a period of three years after completing his prison term. 

On January 9, 2014, Tubb pleaded guilty to one count of aiding and abetting the falsification and removal of VINs.  According to court documents, since 2010, Tubb directed his half-brother and employee, 24-year-old Johnathan Harvey Nicholas, to remove or alter identification numbers from vehicles at Tubb Collision. 

During the investigation, authorities executed a search warrant at a storage unit in Flynn, TX, being rented by Nicholas using an alias.  The unit contained a stolen vehicle, which had previously been in the possession of Tubb, as well as numerous vehicle parts from new vehicles, such as dashes, door panels and steering columns.  Many of these component parts had their VIN and/or vehicle traceability numbers removed or altered.  Subsequently, authorities executed several other search warrants at various locations within Leon County which resulted in the discovery of approximately six (6) stolen vehicles and various vehicle component parts.  

On January 8, 2014, Judge Smith sentenced Nicholas to one year and one day in federal prison followed by three years of supervised release and ordered that he pay a $500 fine for his role in the scheme. 

In El Paso today, 32-year-old former El Paso Police officer and El Paso County Constable Billy Jack Barrow was sentenced to two years in federal prison on a drug conspiracy charge announced United States Attorney Robert Pitman and Federal Bureau of Investigation Special Agent in Charge Douglas E. Lindquist.

In addition to the prison term, Senior U.S. District Judge David Briones ordered that Barrow pay a $500 fine and be placed under supervised release for a period of two years after completing his prison term. Judge Briones also ordered that Barrow surrender to federal authorities on or before May 9, 2014, to begin serving his prison term.

On October 31, 2013, Barrow pleaded guilty to one count of conspiracy to possess with intent to distribute cocaine.  By pleading guilty, Barrow admitted to tipping off co-conspirators about bar checks and other law enforcement operations while serving as an El Paso County Constable from January 2010 through September 2012.

This investigation was conducted by the Federal Bureau of Investigation and the Drug Enforcement Administration together with the El Paso Police Department and the El Paso County Sheriff’s Office. Assistant United States Attorney John Gibson prosecuted this case on behalf of the Government.

In El Paso today, 41-year-old Christopher Morris was sentenced to 71 months in federal prison followed by 20 years of supervised release for failure to register as a sex offender announced United States Attorney Robert Pitman and United States Marshal Robert Almonte.

According to court records, Morris was convicted of Sexual Assault in the Second Degree in Arkansas in 2004. As a result, he was sentenced to serve twenty years incarceration with all but five years suspended. In May 2009, Morris relocated to El Paso, but failed to register with the El Paso Police Department or El Paso County Sheriff’s Office.

On December 9, 2013, Morris pleaded guilty to one count of failure to register as a sex offender.    In August 2010, Morris was arrested based on a state aggravated sexual assault charge.  He was subsequently convicted and sentenced to 30 years incarceration for that offense.  Today, U.S. District Judge Philip R. Martinez ordered that five years of Morris’ federal sentence run consecutive to his 30-year state sentence.

This investigation was conducted by the United States Marshals Service together with the El Paso Police Department. Assistant United States Attorneys Kerry Blackburn and Robert Almonte, II, prosecuted this case on behalf of the Government.

In Del Rio this afternoon, 35-year-old Hipolito Amaya, owner of AM-ROD Construction based in Eagle Pass, was sentenced to 41 months in federal prison for his role in connection with an alleged bribery, kickback and bid-rigging scheme in Maverick County announced United States Attorney Robert Pitman and Acting FBI Special Agent in Charge Aaron C. Rouse.

In addition to the prison term, U.S. District Judge Alia Moses ordered that Amaya pay $35,800 restitution to Maverick County.  Judge Moses also ordered that Amaya be placed under supervised release for a period of three years and must complete 500 hours of community service after completing his prison term. 

In October, Amaya pleaded guilty to a bribery charge.  By pleading guilty, Amaya admitted that in May 2011, he submitted a $35,800 bid to Maverick County to construct a concrete sidewalk on Lago Vista in Precinct 4 of Maverick County.  Maverick County issued him a $17,900 check to commence work and then a $17,900 check for the completion of the sidewalk.  Amaya further admitted that he made cash payments to two Maverick County employees so that he could be paid in full for work he never performed. 

This ongoing investigation is being conducted by the Federal Bureau of Investigation and the Texas Department of Public Safety.  Individuals who have first-hand information about corruption, fraud, or bribery related to Maverick County are urged to contact the FBI at (210) 225-6741.  Assistant United States Attorney Michael Galdo prosecuted this case on behalf of the Government.

In Austin this morning, 57–year-old Russell Allen Erxleben of Dripping Springs, TX, was sentenced to 90 months in federal prison followed by three years of supervised release and ordered to pay restitution for implementing a Ponzi scheme involving an estimated $2 million announced the U.S. Attorney’s Office for the Western District of Texas.

In December, Erxleben pleaded guilty to federal wire fraud and money laundering charges.  According to court records, from 2005 until October 2009, Erxleben devised and implemented a scheme to defraud and to obtain money from investors by the use of fraudulent pretenses, representations and promises.  Erxleben used several companies, including WALTEC Consultants, LRE Holdings, and The MDM Group, to promote investments in fraudulent ventures including investments in post-WWI German government gold bearer bonds and in a work of art purportedly by Paul Gauguin, a famous late 19th-early 20th century artist.  By pleading guilty, Erxleben admitted that he used investment proceeds for the benefit of himself and his family, to pay purported dividends to previous investors, and to fund other undisclosed endeavors, contrary to promises and representations made by the defendant.  In furtherance of the fraudulent scheme, Erxleben made various wire transfers using numerous financial accounts which were opened and maintained by others in an effort to avoid detection by authorities. 

This investigation was conducted by the Internal Revenue Service-Criminal Investigation and the Texas State Securities Board along with assistance from Homeland Security Investigations (HSI).  Assistant United States Attorneys Matthew Devlin and Alan Buie prosecuted this case on behalf of the Government. 

In San Antonio today, United States Chief District Judge Fred Biery handed down prison sentences to three individuals for their roles in what is believed to be the largest real dollar loss fraud and tax related case ever prosecuted in the Western District of Texas announced United States Attorney Robert Pitman, Acting FBI Special Agent in Charge Aaron C. Rouse and IRS-Criminal Investigation Special Agent in Charge Steve McCollough. 

John Bean, owner of Synergy Personnel, a Professional Employer Organization (PEO) based in San Antonio, as well as an agent, representative, officer, license holder and accountant of several San Antonio and Austin based PEOs, including Service Professionals, was sentenced to six years in federal prison followed by three years of supervised release and ordered to pay over $120 million in restitution after pleading guilty to a money laundering charge and a mail fraud conspiracy charge in March 2013.

Pat Mire, owner and manager of several San Antonio-based PEOs, including Service Professionals, was sentenced to three years in federal prison followed by three years of supervised release and ordered to pay $10 million in restitution after pleading guilty to a money laundering charge and a mail fraud conspiracy charge in November 2011.

Mike Solis, an executive assistant at several San Antonio based PEOs, including Service Professionals, was sentenced to two years in federal prison followed by three years of supervised release after pleading guilty to a mail fraud conspiracy charge in December 2012.

A fourth defendant, John D. Walker, II, owner and manager of several San Antonio-based PEOs, including AK of Nevada, Inc., United Focus, Inc. and Safe Staff, Inc., was sentenced to five years probation and ordered to pay $450,000 restitution after pleading guilty to a Klein tax fraud conspiracy charge and a false statements charge in May 2012.

“This was a multi-faceted fraud scheme that victimized companies who relied on the defendants for payroll services, honest workers who relied on insurance coverage, and the taxpayers.  At heart, the defendants were clever bandits who covered their tracks with layers of shell corporations and bank accounts, and siphoned off monies for their own luxury.  The hard work of the investigators and the prosecutor untangled their devious scheme and brought the defendants to justice,” stated United States Attorney Robert Pitman.

Today’s sentencing hearings for Larry Kimes, the manager of AccounTex Financial Services, LLC, and Charles Pircher, manager of a series of PEOs based in San Antonio, including Service Professionals, were continued.  This morning, Judge Biery revoked Kimes’ bond and remanded him into federal custody.  Kimes, who pleaded guilty to a Klein tax fraud conspiracy charge and a mail fraud conspiracy charge last month, will be sentenced in approximately 30 days.  Pircher, who pleaded guilty to the same two charges in November 2013, will be sentenced in approximately 60 days.

By pleading guilty, the defendants admitted that between 2002 and 2008, they participated in a scheme in which they stole more than $133 Million from the clients of a series of PEOs operated by the defendants.  The PEOs entered into staff leasing agreements with various client companies to manage the companies’ payroll and insurance programs.  Kimes, Pircher and the other co-conspirators diverted to their own use and benefit clients’ monies that should have been paid for payroll taxes and insurance premiums.

“Motivated by greed, the defendant perpetrated an extensive fraud scheme, designed to steal money from their clients and taxpayers over a number of years.  The FBI will continue to work with our partners to identify, investigate and prosecute others, like the defendant, who seek unjust enrichment by victimizing others,” stated Acting FBI Special Agent in Charge Aaron C. Rouse.

“The defendants involved in this, the largest ever single criminal tax case in San Antonio's history, knowingly violated our country's Tax laws. They chose to ignore their responsibilities and live a lavish lifestyle on money belonging to their employees and to the U.S. Government. IRS Special Agents will continue to aggressively pursue these types of very serious tax crimes,” stated IRS-Criminal Investigation Special Agent in Charge Steve McCollough.

This case was investigated by agents with the Federal Bureau of Investigation and the Internal Revenue Service-Criminal Investigation.  Assistant United States Attorney Thomas J. McHugh prosecuted this case on behalf of the Government. 

Los Zetas associate and Eagle Pass, TX, resident Jose Luis Rodriguez (a.k.a. “Pollo”), age 36, faces up to life in federal prison after a jury in San Antonio convicted him this afternoon of federal kidnapping and drug charges announced United States Attorney Robert Pitman, Acting FBI Special Agent in Charge Aaron C. Rouse, San Antonio Division, and Acting Drug Enforcement Administration Special Agent in Charge Steven S. Whipple, Houston Division. 

The jury convicted Rodriguez of one count of conspiracy to possess with intent to distribute cocaine, three substantive counts of possession with intent to distribute cocaine and one count of conspiracy to kidnap.  Evidence presented during trial revealed that from September 2006 until April 2007, Rodriguez and others conspired to distribute more than 1,600 kilograms of cocaine from Mexico through Eagle Pass and transported it to San Antonio then ultimately to Cleveland, OH; Memphis, TN; Saginaw, MI; and, New York, NY.  During the course of the investigation, authorities seized a total of approximately 113 kilograms of cocaine and in excess of $2 million in drug proceeds attributed to Rodriguez and his co-conspirators.

Evidence also revealed that Rodriguez and others conspired in early 2007 to unlawfully kidnap an Eagle Pass resident and hold him hostage in Piedras Negras, Mexico, for the purpose of collecting money and property in order to satisfy an illegal drug debt owed by the Eagle Pass resident.  

Rodriguez, who was arrested in Mexico on a provisional arrest warrant and extradited to the U.S. last year, remains in federal custody.  Sentencing is scheduled for May 21, 2014, before United States District Judge Royce C. Lamberth.

In El Paso today, FBI agents arrested 28–year-old Don Ray Dorsett for allegedly pointing a laser at an aircraft flying overhead announced United States Attorney Robert Pitman and FBI Special Agent in Charge Douglas E. Lindquist, El Paso Division.

In February 2012, President Barrack Obama signed the “FAA Modernization and Reform Act of 2012” and added a new provision that makes it a federal crime to aim a laser pointer at an aircraft.  This week, the federal grand jury in El Paso returned a one-count indictment charging Dorsett with violating that provision (Title 18 United States Code Section 39A—Aiming a Laser Pointer at an Aircraft).  The indictment alleges that on January 4, 2014, Dorsett knowingly aimed the beam of a laser pointer at a helicopter flying overhead.  The aircraft belonged to the Texas Department of Public Safety.

“Although no one was injured during this incident, laser strikes can pose serious risks to flight crews, passengers, and even individuals on the ground.  Laser strikes are a serious public safety hazard and will be treated as such by law enforcement officials,” stated United States Attorney Robert Pitman. 

Upon conviction, the defendant faces up to five years in federal prison and a maximum $250,000 fine. 

“Today’s arrest of Don Dorsett is a prime example of the cooperative and collaborative relationship between the FBI and our local partners.  The FBI, in tandem with the Texas Department of Public Safety and our other local law enforcement partners, take aircraft safety seriously.   The FBI will continue to vigorously investigate and seek prosecution for those engaged in laser strikes on aircrafts and other criminal activity involving aircrafts and innocent bystanders,” stated FBI Special Agent in Charge Douglas E. Lindquist, El Paso Division.

This indictment resulted from an investigation conducted by agents with the Federal Bureau of Investigation together with the Texas Department of Public Safety and the El Paso Police Department.  Assistant United States Attorney Stanley Serwatka is prosecuting this case on behalf of the Government.

An indictment is merely a charge and should not be considered as evidence of guilt.  The defendant is presumed innocent until proven guilty in a court of law.

Reported incidents of laser strikes are on the rise. Since the FBI and the Federal Aviation Administration (FAA) began tracking laser strikes in 2005, statistics reflect a more than 1,100% increase in the deliberate targeting of aircraft by people with handheld lasers. In 2013, there were a total of 3,960 laser strikes reported – an average of almost 11 incidents per day.

Earlier this month, the FBI announced the inception of the Laser Threat Awareness Campaign, a nationwide effort led by the FBI in collaboration with the Air Line Pilots Association, Int’l (ALPA) and the FAA to raise awareness of aircraft laser illumination threats.  If you have information about a lasing incident, contact the El Paso FBI at 915-832-5000.  If you see someone pointing a laser at an aircraft, call the nearest local law enforcement agency immediately by dialing 911. Tips can also be submitted online at https://tips.fbi.gov.

This morning, 27-year-old Larry Elmoe Drummer of San Antonio was sentenced to 70 months in federal prison and ordered to pay $8,581 for robbing the Chase Bank located in the Park North shopping center on February 1, 2013, announced United States Attorney Robert Pitman and Federal Bureau of Investigation Acting Special Agent in Charge Aaron C. Rouse, San Antonio Division.

On November 13, 2013, Drummer pleaded guilty to one count of bank robbery for the above mentioned incident.  At the time of his guilty plea, Drummer agreed to pay restitution for his role in three additional bank robberies, namely: $4,296 for the robbery of Frost Bank in the 10000 block of Wurzbach Road on December 19, 2012; $1,000 for the robbery of Security Service Bank in the Park North shopping center on January 23, 2013; and, $11,000 for an earlier robbery of Chase Bank in the Park North shopping center on January 2, 2013.  The total restitution ordered in this case to be paid by the defendant amounts to $24,887.

This investigation was conducted by the Federal Bureau of Investigation together with the San Antonio Police Department. Assistant United States Attorney Matthew Lathrop prosecuted this case on behalf of the Government.

In Del Rio today, 20-year-old Simon Robert Barron, a former reserve U.S. Airman temporarily assigned to Laughlin Air Force Base, pleaded guilty federal charges of stealing Government property and burglary of a pharmacy announced United States Attorney Robert Pitman.

According to court records, on May 20, 2013, Barron attempted to purchase cough syrup at the LifeChek Pharmacy located on North Bedell Avenue, but was turned away for not having a prescription.  That evening, Barron returned to the pharmacy where he used a rock to smash a window, entered the pharmacy, and then stole an assortment of narcotics with a retail value of more than $63,000.  Two days later, while at Laughlin AFB, Barron was ordered to undergo a medical evaluation after he appeared intoxicated.  A urinalysis revealed the presence of marijuana, Xanax, cocaine, codeine, and several opiates in his system.  During a subsequent search authorization, issued by a military magistrate and executed at the Barron’s barracks room, Air Force OSI investigators discovered over 6,300 pills and liquid narcotics stolen from the LifeChek pharmacy along with stolen Government property including seven GPS units, two digital cameras, a power drill, an LED flashlight and a Motorola Radio Base Station.  Authorities also recovered an Air Force air compressor from Barron’s vehicle and a Government chainsaw Barron pawned at a local pawn shop on the day of the pharmacy burglary.  The value of the stolen Government property is estimated to be more than $5,500.

Barron faces up to twenty years in federal prison on the pharmacy burglary charge and up to ten years in federal prison on the theft of Government property charge.  He remains on bond pending sentencing which has yet to be scheduled.

In Del Rio today, 64-year-old Saul Lombrana, owner and operator of Fiesta Contractors based in Eagle Pass, admitted to paying a bribe in order to receive a Maverick County construction contract announced United States Attorney Robert Pitman and Acting FBI Special Agent in Charge Aaron C. Rouse, San Antonio Division.

Appearing before United States District Judge Alia Moses this afternoon, Lombrana pleaded guilty to one count of paying a bribe to an agent of an organization receiving federal funds.  By pleading guilty, Lombrana admitted that in March 2011, he submitted a $14,500 bid to construct 155 linear feet of concrete drain swell on Rafael Street in Precinct 1.  After being awarded the contract, Lombrana never constructed the concrete drain swell, but requested and received full payment for the project.  Of the $14,500 he received, Lombrana admittedly only kept $5,000 while giving the rest to a Maverick County employee as a bribe. 

Lombrana faces up to ten years in federal prison, a maximum $250,000 fine and restitution to be determined by the Court.  He remains on bond pending sentencing which has yet to be scheduled.

This ongoing investigation is being conducted by the Federal Bureau of Investigation and the Texas Department of Public Safety.  Individuals who have first-hand information about corruption, fraud, or bribery related to Maverick County are urged to contact the FBI at (210) 225-6741.  Assistant United States Attorneys Michael Galdo and Bryan Reeves are prosecuting this case on behalf of the Government.

A federal grand jury indictment unsealed this morning in San Antonio charges Hector Javier Villarreal Hernandez, the former Secretary of Finance for the Mexican State of Coahuila, Mexico, for his alleged role in a money laundering conspiracy announced United States Attorney Robert Pitman; Drug Enforcement Administration Acting Special Agent in Charge Steven Whipple, Houston Division; Internal Revenue Service-Criminal Investigation Special Agent in Charge Steve McCollough and Homeland Security Investigations Special Agent in Charge Janice Ayala.

The indictment alleges that since January 2008, Villarreal and others conducted financial transactions involving the proceeds of unlawful activity.   According to the indictment, the proceeds in question involve the importation, sale and distribution of controlled substances; bribery of a public official; embezzlement of public funds; and, wire fraud.  The indictment further alleges that as part of the scheme, the defendant transferred funds in and out of the United States in order to conceal and disguise the nature, source and ownership of the criminally derived proceeds.

Upon conviction, the defendant faces up to 20 years in federal prison. 

Villarreal surrendered to federal authorities in El Paso yesterday.  He remains in federal custody following his Initial Appearance this afternoon in San Antonio before United States Magistrate Judge Henry Bemporad.  No further court dates are scheduled at this time.

This indictment resulted from an investigation conducted by agents with the Drug Enforcement Administration (DEA) together with Internal Revenue Service-Criminal Investigation (IRS-CI), Homeland Security Investigations (HSI) and the DEA’s High Intensity Drug Trafficking Area (HIDTA) Task Force in San Antonio. 

The United States Government is grateful for the ongoing cooperation of the Government of Mexico with regard to this investigation.

An indictment is merely a charge and should not be considered as evidence of guilt.  The defendant is presumed innocent until proven guilty in a court of law.

In Brownsville today, former Cameron County District Attorney Armando R. Villalobos was sentenced to 13 years in federal prison for his role in a South Texas bribery and extortion scheme announced United States Attorney Robert Pitman.

In addition to the prison term, U.S. District Judge Andrew Hanen ordered that Villalobos pay $339,000 in restitution, pay a $30,000 fine, and be placed under supervised release for a period of three years after completing his prison term.  Judge Hanen also ordered that Villalobos be remanded to the custody of the U.S. Marshals Service following today’s sentencing hearing.

“The most important component of an effective justice system is the public’s ability to trust those who are responsible for enforcing the law.  But even when there is a breach of that trust, as in this case, the public should take some comfort in knowing that there is a mechanism for detecting, rooting out and punishing those who would corrupt the process,” stated United States Attorney Robert Pitman.

In May 2013, a federal jury convicted Villalobos of one count of violating the Racketeer Influenced and Corrupt Organizations (RICO) Act, one count of conspiracy to violate the RICO Act and five counts of extortion.  Jurors acquitted Villalobos of two counts of extortion.  This afternoon, Judge Hanen granted the defendant’s motion for acquittal on an extortion count (count 3) before sentencing Villalobos to 156 months incarceration on each of the six remaining charges all to run concurrent.

Evidence presented at trial revealed that from October 2, 2006, through May 3, 2012, Villalobos and others were involved in a scheme to illegally generate income for themselves and others through a pattern of bribery and extortion, favoritism, improper influence, personal self-enrichment, self-dealing, concealment and conflict of interest.  Jurors found that Villalobos solicited and accepted over $100,000 in bribes and kickbacks in the form of cash and campaign contributions in return for favorable acts of prosecutorial discretion, including minimizing charging decisions, pretrial diversion agreements, agreements on probationary matters and case dismissals.  Furthermore, Villalobos solicited and arranged for private counsel to handle civil and forfeiture matters associated with criminal matters pending in the Office of the District and County Attorney of Cameron County. 

This investigation was conducted by the Federal Bureau of Investigation, Drug Enforcement Administration, Internal Revenue Service-Criminal Investigation and the Brownsville Police Department.  Former Southern District of Texas Assistant United States Attorney Michael Wynne and current Western District of Texas Assistant United States Attorney Greg Surovic prosecuted this case on behalf of the Government.

In Del Rio on Friday evening, a federal jury found 23-year-old Jesus Cardenas of New Braunfels, TX, and 34-year-old Luis Cardenas guilty on multiple counts of smuggling ammunition from the United States announced U.S. Attorney Robert Pitman and Homeland Security Investigations Special Agent in Charge Janice Ayala.

The federal jury convicted the brothers of two counts of smuggling ammunition from the United States.  The jury also convicted Jesus Cardenas of two counts of smuggling ammunition and magazines from the United States. 

Evidence presented during the three-day-trial showed that on two separate occasions between November 2011 and January 2012, Jesus Cardenas purchased, on behalf of an individual in Piedras Negras, Mexico, a total of more than 15,000 rounds of ammunition and 400 assault rifle magazines intended for export to Mexico.   Furthermore, Luis Cardenas was paid to transfer the ammunition to an individual who then transported it to Del Rio. 

On December 1, 2011, United States Border Patrol agents seized part of the ammunition along with 23 assault rifles within yards of the Rio Grande River outside Del Rio.  Special Agents with Homeland Security Investigations seized additional ammunition and magazines in January 2012.

Both remain in custody pending sentencing.  Each charge of conviction calls for a maximum of ten years in federal prison and a maximum $250,000 fine.  Sentencing for the case is presently set for August 14, 2014, before U.S. District Judge Alia Moses in Del Rio.

This case resulted from an investigation by Homeland Security Investigations (HSI) together with United States Customs and Border Protection, United States Border Patrol and the Federal Bureau of Investigation.  Assistant United States Attorneys Lewis Thomas and Patrick Burke are prosecuting this case for the Government. 

This morning in Austin, Gregory P. Boyd was sentenced to 33 months in federal prison and ordered to pay $185,129.07 restitution to the Internal Revenue Service for filing income tax returns that did not accurately reflect his income announced United States Attorney Robert Pitman and Internal Revenue Service-Criminal Investigation Special Agent In Charge Steve McCullough.

In November 2013, jurors convicted Boyd of three counts of filing fraudulent income tax returns.  Evidence and testimony presented during trial revealed that Boyd knowingly filed false income tax returns for 2004, 2005 and 2006.  On each tax return, Boyd declared that he received zero income when in fact, he received roughly $180,000 in 2004, about $390,000 in 2005, and approximately $225,000 in 2006.  The parties stipulated that Boyd owed income tax in the amount of $26,688 for 2004, at least $102,237 for 2005, and $49,155 for 2006. 

Evidence at trial revealed that Boyd had not paid income taxes on any of the years 2004 through 2011.  Boyd, who played football at the University of Arizona and then played in the NFL during the 1973 and 1974 seasons, worked in the field of real estate development during 2004, 2005 and 2006.

Boyd testified during the trial that he believed his tax returns were true and complied with the law, based on ideas he learned from the book “Cracking the Code” by Peter Eric Hendrickson.  Hendrickson appeared at trial and testified as a witness for the defense. Boyd specifically testified that he believed, based on Hendrickson’s book, that the income tax applies only to the income of federal government employees and federal government contractors, as well as income derived from investments in federal government securities.

“Tax crimes cheat not only the government, but also every honest citizen who follows the rules and meets his or her obligations.  We owe it to these citizens to bring justice to those who willfully break the tax laws,” stated U.S. Attorney Robert Pitman.

“Today’s sentence serves as a reminder during this income tax filing season that everyone has a duty to pay their fair share of taxes and those who don’t will be held accountable,” stated Internal Revenue Service-Criminal Investigation Special Agent In Charge Steve McCullough.

This investigation was conducted by the Internal Revenue Service-Criminal Investigation.  The case was prosecuted by Assistant United States Attorney Alan Buie.

Former Jarrell (TX) Police Chief Andres Tomas Gutierrez, age 51, faces up to 20 years in federal prison after pleading guilty this morning to a wire fraud/theft of honest services charge announced United States Attorney Robert Pitman; Homeland Security Investigations (HSI) Special Agent In Charge Janice Ayala in San Antonio; Department of Homeland Security Office of Inspector General–Investigations Special Agent In Charge J. Kirk Beauchamp in Houston; and Federal Bureau of Investigation Acting Special Agent In Charge John Boles, San Antonio Division.

Appearing before United States Magistrate Judge Mark Lane in Austin this morning, Gutierrez admitted that from the Fall of 2011 to November 2013, he devised a scheme to defraud and deprive the citizens of Jarrell of their right to his honest services through bribery and concealment of information. 

“Gutierrez solicited and accepted cash bribes—between $10,000 and $40,000—from several undocumented aliens in return for requesting and obtaining for the aliens limited immigration benefits that the U.S. government intended and designed for law enforcement purposes,” stated U.S. Attorney Robert Pitman.  “Gutierrez falsely represented to the U.S. government that the undocumented aliens were assisting the Jarrell Police Department with ongoing investigations into narcotics trafficking and human trafficking,” Pitman added.

According to court records, individuals unconnected to the City of Jarrell and its Police Department introduced Gutierrez to undocumented aliens who had money to pay for immigration benefits.  Gutierrez or the individuals who made the introductions, or both, then met with the aliens and explained the benefits they could receive if they paid certain amounts of money.  They lied to the aliens, telling them that the Jarrell Police Department would receive the money and use it to pay for law enforcement operations.  They also told the aliens that they would provide information or assistance to the Jarrell Police Department, for use in criminal investigations, in return for the immigration benefits.  That was also a lie.  Gutierrez never asked the aliens to provide assistance or information in connection with criminal investigations.  What Gutierrez asked for and received from the aliens was money. 

Furthermore, with the help of the individuals who introduced him to the aliens, Gutierrez simply sold the aliens the benefits.  After an alien paid his or her money, Gutierrez would submit to the U.S. government an application for the alien to receive what is known as a Significant Public Benefit Parole, which is a type of immigration status that federal immigration laws make available to aliens who actually assist federal, state and local law enforcement agencies.   The Paroles authorize an alien to reside and work in the United States for up to a year, and they can be renewed.  The applications that Gutierrez submitted said the aliens were providing assistance with ongoing criminal investigations by the Jarrell Police Department, which was false.  Also, the Defendant never disclosed to the United States government that he was selling the Paroles.

“Today’s guilty plea serves as a stern and sobering reminder that no one is above the law especially those who hold a position of public trust,” said Special Agent in Charge Janice Ayala, HSI San Antonio. “HSI will continue to work with its law enforcement partners to root out public corruption wherever it exists.”

“Acts of corruption within law enforcement threaten our nation’s system of justice and undermine the honest and hardworking law enforcement personnel who consistently strive to keep that system the best in the world.  The Department of Homeland Security will not tolerate corruption, and we will aggressively pursue those who choose to break the law,” stated DHS OIG SAC J. Kirk Beauchamp,

“Gutierrez abused his authority and repeatedly broke the law he was sworn to uphold.  He tarnished the badge he wore and violated the trust of the people of Jarrell. This case demonstrates the FBI's commitment to enforce the law and hold individuals accountable, regardless of rank, position, or status,” stated FBI Acting Special Agent In Charge John Boles.

Gutierrez is out on bond pending sentencing.  No sentencing date has been scheduled.

This investigation was conducted by agents with Homeland Security Investigations, Department of Homeland Security Office of Inspector General--Investigations and the Federal Bureau of Investigation.  Assistant United States Attorneys Alan M. Buie and Gregg N. Sofer are prosecuting this case on behalf of the Government.

The government’s investigation into the bribery scheme is ongoing.  Anyone who has pertinent information should call one of the following: the FBI at (512) 506-2136; HSI at (512) 801-1862; or, the DHS Office of Inspector General at (713) 212-4305.

In El Paso, a federal grand jury has returned a 65-count indictment charging four individuals and two companies in connection with an estimated $7.3 million Health Care related fraud scheme announced United States Attorney Robert Pitman; Janice M. Flores, Special Agent in Charge of the Defense Criminal Investigative Service’s Southwest Field Office, Arlington, TX; Special Agent in Charge Scott Wilk of the Southwest Fraud Field Office of the U.S. Army Criminal Investigation Command Major Procurement Fraud Unit, Arlington, TX; and FBI Special Agent in Charge Douglas E. Lindquist, El Paso Division.

Charged in the indictment, which was returned yesterday afternoon, include: 44-year-old former William Beaumont Army Medical Center (WBAMC) physician Richard Craig Rooney of Medina, WA; his 46-year-old wife and former El Paso Otolaryngology (Ear, Nose and Throat) physician and cosmetic surgeon Angie Unchi Song; 44 year-old Julia Lynn Eller, President and Chief Executive Officer of Allure Spine, LLC (Allure) in Charlotte, North Carolina; 71-year-old Charlie Takhyun Song of Grapeview, WA, father of Angie Unchi Song and independent sales representative; Spondylos Consulting, LLC (Spondylos), a company owned by Angie Unchi Song; and, Allure Spine, LLC, a company owned by Julia Eller. 

Rooney, Angie Song, Eller, Charlie Song, Spondylos and Allure are all charged with one count of conspiracy to commit illegal remuneration in regard to Federal Health Care programs; two counts of aiding and abetting illegal remuneration in regard to Federal Health Care programs; one count of conspiracy to commit wire fraud and one count of conspiracy to commit money laundering. Rooney, Angie Song, Eller and the two companies are charged in 39 substantive counts of wire fraud.  Also, Rooney, Eller and Allure are charged with 17 substantive money laundering counts; and Angie Song, Charlie Song and Spondylos, with one substantive money laundering count.  In addition, the indictment also charges Rooney and Eller with two counts each of making material false statements to federal authorities.

The indictment alleges that between September 2002 and August 2010, the defendants participated in an illegal scheme whereby Eller funneled money and other things of value, including firearms, to Rooney, Angie Song and Charlie Song so that Rooney would request the use of Allure Spine surgical implant devices and other medical related equipment in surgeries he performed at WBAMC and at Darnall Army Medical Center at Ft. Hood, TX (DAMC).

The indictment also includes a notice of criminal forfeiture wherein the Government is seeking proceeds derived from the fraudulent scheme as well as funds totaling more than $4.25 million seized from financial institutions and two residential real estate properties located in the State of Washington.

“Today’s indictment demonstrates that the FBI and our partners at the U.S. Attorney’s Office; U.S. Department of Defense, Criminal Investigative Service; U.S. Army Criminal Investigative Command, Major Procurement Fraud Unit; and, the U.S. Postal Inspector Service are committed to thoroughly investigate Health Care Fraud in our community, including Ft. Bliss, whenever health care professionals engage in activity to defraud our health care system for the sole purpose of self-enrichment,” stated FBI Special Agent in Charge Douglas E. Lindquist.

Upon conviction: conspiracy to commit illegal remuneration carries a penalty of up to five years in federal prison; aiding and abetting illegal remuneration in regard to Federal Health Care Programs carries a penalty of up to five years in federal prison; conspiracy to commit money laundering and money laundering carry a penalty of up to 20 years in federal prison; conspiracy to commit wire fraud and wire fraud carry penalties up to 20 years in federal prison; and false statement to federal authorities carries a penalty of up to five years in federal prison. 

This indictment resulted from an investigation conducted by agents with the Defense Criminal Investigative Service (DCIS); agents of the Criminal Investigation Command Major Procurement Fraud Unit of the U.S. Army Criminal Investigation Command; and agents of the Federal Bureau of Investigation (FBI).  Assistant United States Attorneys Debra Kanof and Anna Arreola are prosecuting this case on behalf of the Government.

An indictment is merely a charge and should not be considered as evidence of guilt.  The defendants are presumed innocent until proven guilty in a court of law.

El Paso resident Gustavo Cervantes-Perez, age 26, will serve ten years in federal prison for possession and distribution of child pornography announced United States Attorney Robert Pitman and Homeland Security Investigations (HSI) Special Agent in Charge Dennis A. Ulrich, El Paso.

In addition to the prison term handed down today, U.S. District Judge Kathleen Cardone ordered that Cervantes-Perez pay a $1,500 fine and be placed under supervised release for a period of five years after completing his prison term.

On September 11, 2013, a jury convicted Cervantes-Perez of two counts of possession of child pornography and two counts of receipt/distribution of child pornography.  Evidence presented during trial revealed that the defendant used a peer-to-peer program to search for and acquire images/videos of child pornography beginning in approximately April 2006. Following the execution of a search warrant on January 6, 2012, at the defendant’s residence, HSI agents forensically discovered 156 videos depicting child pornography on Cervantes-Perez’s computer.

Assistant United States Attorney Robert Almonte, II, and former Assistant United States Attorney J. Brandy Gardes prosecuted this case on behalf of the Government.

Former Austin Police Officer Jermaine Gaspard, age 34, faces up to five years in federal prison after pleading guilty this afternoon to making a false statement to federal authorities announced United States Attorney Robert Pitman, U.S. Secret Service Acting Special Agent In Charge Ben Bass, Federal Bureau of Investigation Special Agent In Charge John Boles, San Antonio Division, and Austin Police Chief Art Acevedo.

Appearing before United States Magistrate Judge Andrew Austin in Austin this afternoon, Gaspard admitted that he made a false statement to federal authorities conducting a credit card fraud investigation.  According to the factual basis filed in this case, in April 2013, Gaspard knowingly accessed the mobile data terminal inside his Austin Police Department (APD) patrol car and performed an unauthorized database check on a subject.  Subsequently, Gaspard showed the subject the APD report he discovered, which included the fact that there was a pending indictment related to the subject’s fraudulent use of a credit card.  When questioned by federal authorities, Gaspard denied providing the information to the subject.

Gaspard is out on bond pending sentencing.  No sentencing date has been scheduled.

This investigation was conducted by agents with the U.S. Secret Service and the Federal Bureau of Investigation together with the Austin Police Department.  Assistant United States Attorney Gregg N. Sofer is prosecuting this case on behalf of the Government.

In Del Rio this afternoon, United States District Judge Alia Moses sentenced 34-year-old Richard Hesles, Jr., and his brother, 24-year-old Damien Hesles to 120 months and 110 months in federal prison, respectively, in connection with a scheme to smuggle over 6,000 rounds of ammunition and hundreds of firearm magazines into the Republic of Mexico stated United States Attorney Robert Pitman, Homeland Security Investigations (HSI) Special Agent In Charge Janice Ayala and Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) Special Agent In Charge Robert Elder, Houston Division.

In addition to the prison term, Judge Moses ordered that Richard Hesles pay a $7,500 fine and be placed under supervised release for a period of three years after completing his prison term; Damien Hesles, a $5,000 fine and three years of supervised release following his prison term.  Judge Moses also ordered that Richard Hesles, Jr., and Damien Hesles pay monetary judgments in the amount of $54,414 and $42,634, respectively.  Those sums represent the value of property involved or used to facilitate the defendants’ scheme.

On October 25, 2013, the defendants pleaded guilty to one count of aiding and abetting the smuggling of goods from the United States.  According to the factual basis in this case, while under surveillance at the Hesles Gun and Knife Store in Eagle Pass, TX, on February 17, 2012, Damien Hesles unloaded several boxes from his vehicle.  Those boxes were subsequently loaded into another vehicle which began traveling towards the U.S.-Mexico border.  When the driver of that vehicle noticed he was being followed, he stopped the vehicle and discarded the boxes inside a dumpster, then fled the area.  Inside the boxes, surveillance agents discovered U.S. defense articles, namely 100 AR-15 assault rifle rear tactical sights and 100 AR-15 assault rifle front tactical sights.

Investigators were able to determine that Piedras Negras, Mexico residents Oliver Bres-Carranza and Erik Alan Garza had spoken to Richard Hesles, Jr., and placed the order for the AR-15 sights.  Damien Hesles received payment from Bres-Carranza and Garza for the sights and then shared the money with his brother.

Authorities estimate that the brothers aided and abetted the exportation or attempted exportation of over 6,000 rounds of ammunition designed for use in various firearms, including AK-47 and AR-15 assault rifles as well as .50 caliber sniper rifles; over 300 assault rifle magazines and more than 60 magazines for other types of firearms; and, firearm sights.

The factual basis, which the defendants admitted was accurate, stated that the brothers procured ammunition, firearm magazines and firearm sights for individuals in Mexico from 2010 until 2012 and that Richard Hesles, Jr., knew that the items were going to Los Zetas Cartel operatives in Mexico.

The brothers, along with the store owner, have entered into an agreement with the Government to surrender their Federal Firearms License and to no longer support or fund, directly or indirectly, any business or venture which deals in any manner with the sale, trade or distribution of firearms, ammunition, magazines and/or components/accessories related to the firearms trade.

“Gun and drug trafficking fuels violence by criminal organizations domestically and abroad,” said Special Agent in Charge Janice Ayala, HSI San Antonio. “HSI special agents will continue working jointly with our law enforcement partners and utilize our expertise in export enforcement to keep our citizens safe and secure.”

On January 15, 2014, Erik Alan Garza was sentenced to 44 months in federal prison and fined $3,000 for his role in the smuggling scheme.  Bres-Carranza, who remains in custody, faces up to ten years in federal prison after pleading guilty in October 2013 to his role in the smuggling scheme.  Bres-Carranza is scheduled to be sentenced at 9:00am on February 25, 2014, before Judge Moses.  A 5th defendant in this case, Rolando Tamayo, was released on bond following his arrest in June 2012, but is now considered a fugitive.

The case was investigated by agents from Homeland Security Investigations (HSI) together with the assistance of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF). Assistant United States Attorneys Michael Galdo prosecuted this case on behalf of the Government.

In Austin this morning, 47-year-old Richard Edward Sofinowski surrendered to federal authorities to face federal drug trafficking charges announced United States Attorney Robert Pitman and Drug Enforcement Administration Acting Special Agent In Charge Steven S. Whipple, Houston Division.

A three–count federal grand jury indictment returned on last Tuesday charges Sofinowski, an Austin psychiatrist, and his co-defendant, 42-year-old Arza Demi of Austin, with one count of conspiracy to distribute methamphetamines and other controlled substances outside the scope of professional practice as well as two substantive drug distribution counts.  Authorities allege that Sofinowski, with assistance from Arza, was responsible for doling out more than 400 prescriptions involving a variety of potent narcotic pain medications in exchange for methamphetamine and U.S. Currency.   

The indictment also includes a request for a monetary judgment in the amount of $1 million representing the proceeds derived from the alleged criminal activity.

“Prescription drug abuse has become increasingly prevalent in the community, and it is especially serious when a licensed medical professional violates his professional duties as well as federal law in illegally dispensing controlled substances.  If Dr. Sofinowski is found guilty of writing prescriptions for narcotics in violation of the law as charged by the grand jury, he will face serious consequences for enabling others’ dependence on drugs,” stated United States Attorney Robert Pitman.

Sofinowski was released on a personal recognizance bond during his initial appearance today.   Demi remains in federal custody after her detention hearing, originally scheduled for this afternoon before U.S. Magistrate Judge Andrew Austin, was continued.

Upon conviction, each defendant faces up to 20 years in federal prison.

This investigation was conducted by the Drug Enforcement Administration’s Diversion group in Austin.  Assistant United States Attorney Mark Marshall is prosecuting this case on behalf of the Government. 

An indictment is merely a charge and should not be considered as evidence of guilt.  The defendants are innocent until proven guilty in a court of law.

In El Paso this morning, 47-year-old El Paso attorney Marco Antonio Delgado, a.k.a. Marco Delgado Licon, was sentenced to the maximum 20 years in federal prison after a jury convicted him of conspiracy to launder up to $600 million in illegal drug proceeds announced United States Attorney Robert Pitman and Homeland Security Investigations (HSI) Special Agent in Charge Dennis Ulrich.

In addition to the prison term, U.S. District Senior District Judge David Briones ordered that Delgado pay a $25,000 fine and be placed under supervised release for a period of three years after completing his prison term.

In October 2013, a jury convicted Delgado of conspiracy to commit money laundering.  Based on evidence presented during trial, the jury found that from a period of time between 2007 and 2008, Delgado conspired with other individuals to launder $600 million in illegal drug proceeds for members of the Milenio Drug Trafficking Organization.  Two episodes of money laundering demonstrated to the jury included a Department of Homeland Security and Carroll County (GA) Sheriff’s Department seizure in September 2007 of $1,000,000 in U.S. Currency traveling from Atlanta, GA, to Mexico via El Paso; and, an HSI seizure of $50,000 in drug proceeds, in July 2008, in Chicago, IL, which was transported to El Paso and deposited in Delgado’s Attorney Interest on Lawyers’ Trust Account (IOLTA) bank account.

Delgado has remained in federal custody since his arrest in November 2012.

Delgado is currently set to go to trial again on March 31, 2014, based on a separate superseding indictment, returned on Wednesday, which charges him with three wire fraud counts and 16 money laundering counts—seven of which allege intent to conceal proceeds of illegal activity and nine of which allege spending of proceeds derived from illegal activity.  According to the superseding indictment, in January 2010, Delgado, as a legal representative of FGG Enterprises, Inc. (FGG) signed a $121 million contract between FGG and the Comision Federal de Electricidad (CFE), a Mexican-state-owned utility company, for the acquisition and maintenance of equipment at the Agua Prieta II power plant located in Agua Prieta, Sonora, Mexico.  Pursuant to the agreement, payments from CFE to FGG were to be deposited into a FGG bank account located in El Paso.

The superseding indictment alleges that Delgado, for the purpose of personal enrichment and without the consent of the sole owner of FGG, submitted a fraudulent written request to CFE in Mexico which caused two wire transfers—one on March 8, 2010, in the amount of $20 million and one on July 6, 2010, in the amount of $12 million—to be deposited into a bank account he controlled located in the Turks and Caicos Islands.  The superseding indictment further alleges that Delgado subsequently wire transferred approximately $1.9 million from the Turks and Caicos Island bank account to bank accounts in El Paso; Taos, NM; and, Pittsburgh, PA, in order to either conceal the nature, location, source or ownership of the proceeds, or spend the proceeds, derived from his scheme.

Each wire fraud count and money laundering (intent to conceal) count call for up 20 years in federal prison upon conviction.  Each of the money laundering (spending) counts call for up to ten years in federal prison upon conviction. 

An indictment is merely a charge and should not be considered as evidence of guilt.  The defendant is presumed innocent until proven guilty in a court of law.

In Waco this afternoon, former Normangee Police Chief Joseph Ray “Jody” Navarro pleaded guilty to unlawfully obtaining information from a law enforcement computer system announced United States Attorney Robert Pitman. 

Appearing before United States District Judge Walter S. Smith, the 41–year-old Madisonville, TX, resident pleaded guilty to one count of intentionally exceeding authorized access to a protected computer.  By pleading guilty, Navarro admitted that in May 2013, he ran a background check on a license plate and name supplied to him by suspected methamphetamine trafficker and Normangee resident Brenda Antanette Evans, age 45.  As a condition of his guilty plea, Navarro must relinquish his Texas peace officer’s license.

Should the Court accept Navarro’s guilty plea, Navarro faces up to one year in federal prison and a maximum $100,000 fine at sentencing scheduled for March 19, 2014.

Previously, Evans and co-defendant 25–year-old Joshua Troy Thomas of Normangee pleaded guilty to conspiracy to possess with intent to distribute methamphetamine.  According to court records, on April 26, 2013, during an undercover investigation, Evans purchased close to one ounce of methamphetamine from Thomas on behalf of an undercover agent for approximately $1,200.  Earlier this month, Judge Smith sentenced Evans to five years in federal prison.  Thomas, who faces up to 20 years in federal prison, is scheduled to be sentenced on February 12, 2014.

In Midland, 41-year-old Raja Zafar Iqbal and 50–year-old Javed Iqbal Raja of Odessa, TX, face up to ten years in federal prison after pleading guilty to trafficking in counterfeit goods announced United States Attorney Robert Pitman, Homeland Security Investigations Special Agent in Charge Dennis Ulrich and Federal Bureau of Investigation Special Agent in Charge Douglas E. Lindquist, El Paso Division.

Appearing before United States Magistrate Judge David Counts this morning, Raja Zafar Iqbal admitted to trafficking in counterfeit goods from January 2001 to September 2013. According to court records, Iqbal, with assistance from Raja between November 2008 and September 2013, operated Music City Mall kiosks Gold-N-Silver, ICEE Jewelry, Jewel Time, Pretty-N-Sassy, Famous Stars and Straps, and Right Jewelry. During that time, the defendants knowingly sold counterfeit jewelry, watches, buckles, key chains, lanyards and other items. The counterfeit goods bore trademarks identical to or substantially indistinguishable from trademarks used by Angry Bird, Fox Head, Monster, Nike, Playboy, Polo Ralph Lauren, Chanel and Juicy Couture. The defendants admitted that they were not authorized to sell or distribute any of the goods bearing the counterfeit trademarks.

On September 5, 2013, federal agents arrested the defendants and executed search warrants at the kiosks where they seized over 300 counterfeit items.

Both defendants are currently on bond pending sentencing. No sentencing date has been scheduled. Charges are still pending against a third defendant in this case, 33-year-old Muhammad Asif Raza, formerly of Odessa.

This investigation was conducted by Homeland Security Investigations (HSI) and the Federal Bureau of Investigation (FBI). Assistant United States Attorney Austin Berry is prosecuting these cases on behalf of the Government.

In El Paso, federal authorities have arrested a juvenile probation officer indicted on federal sex trafficking charges  announced United States Attorney Robert Pitman, Homeland Security Investigations Special Agent in Charge Dennis Ulrich and Federal Bureau of Investigation Special Agent in Charge Douglas E. Lindquist, El Paso Division.

On Friday, authorities arrested El Paso County juvenile probation officer 28–year-old Timothy McCullouch, Jr., without incident.  McCullouch is charged in a superseding federal grand jury indictment, returned on Wednesday (1.15.14) and unsealed following his arrest, with one count of conspiracy to commit sex trafficking of persons and one substantive count of sex trafficking of a minor.  McCullouch remains in federal custody pending a detention hearing on January 24, 2014, before United States Magistrate Judge Anne T. Burton.  He faces up to life in federal prison upon conviction. 

In addition to McCullouch, the indictment charges five El Paso gang members for their roles in the sex trafficking scheme including:  25-year-old Deion Lockhart, 21-year-old Brandon Shapiro, 20-year-old Tai Von Lynch, 24-year-old Richard Gray, and 23–year-old Emmanual Lockhart.  All five remain in custody pending trial scheduled for June 6, 2014, before United States District Judge Philip Martinez.  Upon conviction, each defendant faces up to life in federal prison.

Court records allege that the defendants have been involved in the forced prostitution of juveniles and adults by the Folk Nation/Gangster Disciples street gang between May 2012 and March 2013.   The defendants used a combination of force, fraud, and coercion to compel their victims to engage in sexual activities for money in El Paso; Killeen, TX; Albuquerque, NM; Las Vegas, NV; and in Colorado.

This investigation, conducted by Homeland Security Investigations (HSI), Federal Bureau of Investigation (FBI), Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and the El Paso Police Department Gang Unit, also resulted in a separate, but related, indictment.  Folk Nation/Gangster Disciples members Kiry Hakeem Nalls, age 24, and Grant Rutledge, age 24, were indicted in July of last year on forced prostitution charges.  Nalls and Rutlege also face up to life imprisonment upon conviction.  Their trial is currently set for March 3, 2014, before Judge Martinez.

An indictment is merely a charge and should not be considered as evidence of guilt.  The defendants are presumed innocent until proven guilty in a court of law.

Assistant United States Attorneys Rifian Newaz and Robert Almonte are prosecuting these cases on behalf of the Government.

Midland resident Corey Dean Farmer, age 37, will serve 151 months in federal prison followed by a lifetime of supervised release for possession of child pornography announced United States Attorney Robert Pitman and Homeland Security Investigations (HSI) Special Agent in Charge Dennis A. Ulrich, El Paso.

During yesterday’s sentencing hearing in Midland, U.S. District Judge Robert A. Junell also ordered that Farmer pay $157,143.23 restitution to his victims.

On November 1, 2013, Farmer pleaded guilty to the possession of child pornography charge.  By pleading guilty, Farmer admitted using multiple peer-to-programs to search for and acquire images of child pornography beginning in approximately March 2012.  Following the execution of a search warrant on May 9, 2013, at the defendant’s residence, HSI agents forensically discovered approximately 1,300 images depicting child pornography on Farmer’s computer. Farmer also acknowledged that because he did not turn off the “sharing” feature of his peer to peer software, other persons around the world were able to acquire CP images from his computer. 

“This is an appropriate sentence for an individual who criminally engaged in the sexual exploitation of children by freely trading their images with predators worldwide,” said Dennis A. Ulrich, special agent in charge of HSI El Paso. “HSI ranks this type of crime high in its mission priorities, and our agency will continue to dedicate resources to identify and bring to justice other child predators who victimize children in this manner."

Assistant United States Attorney Austin Berry prosecuted this case on behalf of the Government.

In San Antonio this morning, 61-year-old San Antonio businessman Larry W. Kimes pleaded guilty to his role in what is believed to be the largest real dollar loss fraud and tax related case ever prosecuted in the Western District of Texas announced United States Attorney Robert Pitman, FBI Special Agent in Charge Armando Fernandez and IRS-Criminal Investigation Special Agent In Charge Steve McCollough. 

Appearing before United States Chief District Judge Fred Biery, Kimes, the manager of AccounTex Financial Services, LLC, pleaded guilty to a Klein tax fraud conspiracy charge and a mail fraud conspiracy charge.  Kimes admitted that between 2002 and 2008, he and other co-conspirators stole more than $133 Million from the clients of a series of Professional Employer Organizations (PEOs) that he and co-defendant Charles Pircher operated.  The PEOs controlled by Kimes and Pircher, which included Service Professionals, entered into staff leasing agreements with various client companies to manage the companies’ payroll and insurance programs.  Kimes and co-conspirators diverted to their own use and benefit clients’ monies that should have been paid for payroll taxes and insurance premiums.

Kimes faces up to 20 years in federal prison on the mail fraud conspiracy charge and up to five years in federal prison on the Klein tax fraud conspiracy charge.  Kimes also agreed that full restitution in this case amounts to $133,401,713.  Sentencing has yet to be scheduled.

“This guilty plea brings to justice the six perpetrators of a scheme that stole over $133 Million from clients and taxpayers.  The defendants, including Kimes, managed to conceal their crimes behind the complexity of the scheme.  Through the hard work of FBI and IRS-CI agents and Tom McHugh in this office, the defendants’ crimes have been revealed and they will be held accountable,” stated United States Attorney Robert Pitman.

Kimes’ co-defendants—Pircher; John D. Walker, II; John Bean; Mike Solis; and, Pat Mire—are all scheduled to be sentenced on February 21, 2014, at 8:30am before Judge Biery. 

This morning, 52-year-old Albert G. Torres, the owner of G.O.T. Supply, Inc. was sentenced to 18 months in federal prison followed by three years of supervised release for his role in a scheme to defraud the City of El Paso with respect to garbage collection services announced United States Attorney Robert Pitman and FBI Special Agent in Charge Douglas E. Lindquist.

United States District Judge Kathleen Cardone also ordered that Torres pay a $1,500 fine and $223,840 restitution to the City of El Paso.  Furthermore, Judge Cardone ordered that Torres surrender to federal authorities within 90 days to begin serving his prison term.

On May 8, 2013, Torres pleaded guilty to one count of conspiracy to commit wire fraud and deprivation of honest services.  By pleading guilty, Torres admitted that from January 2006 to October 2008, he paid bribes and kickbacks to former City of El Paso Fleet Maintenance Chief Lorenzo Avalos and others to secure work repairing and servicing El Paso city garbage trucks.  During the scheme, Torres also admitted to selling parts to the City at higher-than-agreed-to prices.  

“Today’s sentencing of Mr. Torres should serve as a strong message regarding the FBI’s thorough investigation of all those in the El Paso community involved in public corruption. Nothing erodes the public trust more than those who illegally conspire to line their own pockets with taxpayer dollars,” stated FBI SAC Lindquist.

On August 6, 2013, Avalos was sentenced to 37 months in federal prison followed by three years of supervised release for his role in the scheme.  Avalos is also jointly and severally responsible for the restitution ordered by the Court.

This investigation was conducted by the Federal Bureau of Investigation.  Assistant United States Attorney Chris Skillern prosecuted this case on behalf of the Government.

In San Antonio today, 69-year-old Daniel Henry Lopez was sentenced to 51 months in federal prison for stealing identification information of individuals he met at Veterans Affairs rehabilitation facilities and using that information to obtain credit cards and fraudulent tax refunds from the Internal Revenue Service announced U.S. Attorney Robert Pitman, U.S. Secret Service Acting Special Agent in Charge James Bass, IRS-Criminal Investigation Special Agent in Charge Steve McCollough and Texas Department of Public Safety Director Steve McCraw.

In addition to the prison term, U.S. District Judge Xavier Rodriguez ordered that Lopez pay restitution in the amount of $84,741 and be placed under supervised release for a period of three years after completing his prison term.

On October 10, 2013, Lopez pleaded guilty to one count of wire fraud and one count of aggravated identity theft.  By pleading guilty, Lopez admitted that from January 2012 to April 2013, he devised a scheme to steal means of identification including names, dates of birth and social security numbers from unsuspecting victims.  Lopez further admitted that he used that information to create fraudulent income tax returns which, in turn, generated approximately $78,000 for Lopez in false tax refunds.  Lopez also created fraudulent documents that he used to open various bank accounts.  As a result of his scheme, Lopez caused over $6,000 in losses to financial institutions due to overdrawn checks and other charges.

SAC Steve McCollough noted that the IRS Criminal Investigation Special Agents are aggressively pursuing those who steal others’ identities in order to file false returns.  “The IRS is taking additional steps this tax season to further prevent, detect and resolve identity theft cases as soon as possible,” he stated.

This case resulted from an investigation by the U.S. Secret Service, Internal Revenue Service-Criminal Investigation and the Texas Department of Public Safety.  Assistant U.S. Attorney Jay Hulings prosecuted this case on behalf of the Government.

In Del Rio today, 27-year-old Lauro Beltran of San Antonio was sentenced to 30 years in federal prison for cocaine trafficking announced U.S. Attorney Robert Pitman and Homeland Security Investigations Special Agent in Charge Janice Ayala.

In addition to the prison term, U.S. District Judge Alia Moses ordered that Beltran pay a $5,000 fine and be placed under supervised release for a period of five years after completing his prison term.

In July 2013, a federal jury convicted Beltran of one count of conspiracy to possess with intent to distribute over five kilograms of cocaine.  Evidence presented during trial revealed that from March 2011 to May 2013, Beltran was responsible for recruiting individuals to transport cocaine from the interior of Mexico into the United States, where it was distributed to locations including Chicago, IL, and Miami, FL.  In March 2011, state authorities in Missouri arrested Beltran while he was driving a vehicle which contained $578,328.00 in United States Currency.  Authorities seized, and subsequently forfeited, the money believed to be proceeds of drug distribution.   At sentencing, Beltran was held accountable for distributing over 150 kilograms of cocaine during the course of the conspiracy.

This case resulted from an investigation by Homeland Security Investigations (HSI) together with the Drug Enforcement Administration and the Phelps County (MO) Sheriff’s Office.  Assistant U.S. Attorney Lewis Thomas prosecuted this case on behalf of the Government.

In Albuquerque, NM, today, 64-year-old Danny Burnett, a retired educator and husband of a former federal prosecutor, was sentenced to one year and one day in federal prison followed by one year of supervised release for leaking information regarding a criminal investigation to a target announced United States Attorney Robert Pitman.

In September 2013, a federal jury convicted Burnett of one count of giving notice of certain electronic surveillance and one count of making a false statement to federal investigators. Evidence presented during trial revealed that on February 17, 2011, Burnett met at an Albuquerque restaurant with long-time friend Columbus Police Chief Angelo Vega and advised him that federal investigators had a wiretap on Vega’s phone. Burnett was also convicted of making a false statement to federal investigators on February 28, 2012, when he denied notifying Vega that he was the subject of a firearms trafficking investigation.

“By disclosing the existence of a wiretap to former Columbus Police Chief Angelo Vega, Mr. Burnett undermined a federal investigation of the trafficking of firearms into Mexico and put law enforcement agents in jeopardy. His friendship with Vega explains but does not excuse or justify compromising the investigation of such serious criminal activity. While Mr. Burnett was not a party to the underlying criminality, he committed a serious violation of law in his own right. This office and the Department of Justice will vigorously investigate and prosecute crimes against the integrity of the criminal justice system,” stated United States Attorney Robert Pitman.

This case was investigated by agents with the Department of Justice Office of the Inspector General (DOJOIG), Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and Homeland Security Investigations (HSI). Assistant United States Attorneys Steven Spitzer and Greg McDonald from the Western District of Texas prosecuted this case on behalf of the government.