Western District of Texas

Midland resident and land surveyor Steven Leonard Prewit, age 54, was sentenced to 33 months in federal prison for possessing eight unregistered silencers in violation of National Firearms Registration requirements, announced United States Attorney Robert Pitman, Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) Dallas Field Office Special Agent in Charge Robert Champion and Federal Bureau of Investigation (FBI) Special Agent in Charge Douglas E. Lindquist, El Paso Division.

United States District Judge Robert A. Junell also ordered that Prewit pay a $10,000 fine, be placed under supervised release for a period of three years after completing his prison sentence and surrender to federal authorities no later than March 19, 2014, to begin serving his prison term.

According to court records, a search by the ATF and FBI of both Prewit’s home and a ranch near Balmorhea on May 2, 2013, uncovered the silencers as well as a number of fully automatic machine guns and improvised explosive devices (IEDs).  Specifically, Prewit possessed eight (8) firearms silencers, eighteen (18) fully automatic machine guns, one (1) short barreled rifle and four (4) IEDs; all of which were unregistered.  All eight of the unregistered firearms silencers did not have serial numbers or manufacturer’s markings as required. 

The investigation into Prewit began in March of last year when ATF and FBI agents received information that Prewit was in possession of the items mentioned above.  An FBI undercover employee was on the ranch with Prewit in both March and April of 2013 when he saw Prewit in possession of multiple fully automatic machine guns, silencers and IEDs.  Prewit admitted to the FBI undercover employee that none of the weapons, silencers and/or IEDs was registered to him and that he knew they should have been.

“This investigation is an example of the hard work of ATF Special Agents and the excellent cooperation we have with our Law Enforcement partners.  Because of this cooperation, we were able to seize these dangerous explosive devices, silencers, and machine guns to ensure they never found their way in our communities and the violator faced justice,” said ATF Special Agent in Charge Robert R. Champion.

Under Title 26, United States Code, Chapter 53, any individual who possesses a machine gun, destructive device, or firearm silencer is required by federal law to register the firearms and/or devices with the Alcohol Tobacco and Firearms (ATF) National Firearms Act Branch (NFA).  Before possessing such firearms, the person must complete and have approved an ATF Form 4: Application for Tax Paid Transfer and Registration of the Firearm and pay a tax.  After the application is approved, the firearm may be transferred and the person will be entered into the National Firearms Registration and Transfer Record. 

On August 20, 2013, Prewit pleaded guilty to possessing the unregistered silencers.  In exchange for Prewit’s guilty plea, the Government agreed to dismiss charges which involved the possession of the machine guns and explosive devices.  Assistant United States Attorney LaTawn Warsaw prosecuted this case on behalf of the Government.

In San Antonio this morning, Texas Syndicate (TS) leader Rolando “Black Rabbit” Muniz, age 31, was sentenced to 15 years in federal prison followed by five years of supervised release for conspiring to violate the Racketeering Influenced Corrupt Organization (RICO) statute announced United States Attorney Robert Pitman.

On November 8, 2013, Muniz pleaded guilty to the RICO conspiracy charge.  By pleading guilty, Muniz admitted that beginning in January 2008 until the present, he and others conspired to engage in a pattern of organized criminal conduct including four murders, two attempted murders, conspiracy to commit murder, drug trafficking and other crimes in furtherance of the goals and the mission of the Texas Syndicate.

Specifically, Muniz admitted to distributing various amounts of cocaine and heroin throughout San Antonio as well as participating in the planning of the attempted murder of fellow gang member and co-defendant Andrew Vidaurri on July 2, 2011.  During that attempt, Andrew Vidaurri’s sister-in-law, Priscilla Ann Vidaurri, was killed in the crossfire by TS gunmen.  Andrew Vidaurri is currently serving a four-year prison term after pleading guilty to the RICO conspiracy charge.

Muniz is the last of 20 TS members and associates convicted and sentenced for their roles in this criminal enterprise.  The other defendants received sentences ranging up to 37 years in federal prison.

“This investigation targeted gang members who were attempting to establish a larger presence in San Antonio.  After 20 convictions and federal prison sentences handed down to the Texas Syndicate leadership and it’s most violent members, this prosecution has reached a successful conclusion,” stated U.S. Attorney Robert Pitman.

This case resulted from a joint investigation by the Drug Enforcement Administration and it’s Task Force; Bureau of Alcohol, Tobacco, Firearms and Explosives; Internal Revenue Service-Criminal Investigation; United States Marshals Service; Bexar County Sheriff’s Office, Bexar County District Attorney’s Office, and the San Antonio Police Department. The DEA Task Force is comprised of members of the Comal County Sheriff’s Office, Balcones Heights Police Department, Kendall County Sheriff’s Office, New Braunfels Police Department, Guadalupe County Sheriff’s Office, Terrell Hills Police Department, the Texas Department of Criminal Justice - Inspector General; and the Texas National Guard.  Assistant United States Attorneys Joey Contreras and Karen Norris prosecuted this case on behalf of the Government.

Authorities arrested 28 individuals yesterday on federal and state drug charges announced United States Attorney Robert Pitman, Midland County District Attorney Teresa J. Clingman, Drug Enforcement Administration Special Agent in Charge Joseph A. Arabit, El Paso Division, and Midland Police Chief Price Robinson. 

15 of those arrested yesterday, including 46–year-old Jesus Enrique Gabaldon-Villa, 64-year-old Jesus Manuel Anchondo of Odessa, 50-year-old Samuel Ortiz of Midland, and 30–year-old Jesse “Chuy” Martinez of Midland, are charged in four federal grand jury indictments returned last month and unsealed today in Midland.

Three of the federal indictments (Gabaldon-Villa, et al.; Anchondo, et al.; and, Ortiz, et al.) focus on a heroin trafficking conspiracy operating in the Permian Basin area.  The indictments charge ringleader Jesus Gabaldon-Villa, Jesus Anchondo, Samuel Ortiz and 11 others with conspiracy to possess with intent to distribute heroin.   Authorities allege that from May to December of last year, the defendants were responsible for transporting multiple ounce quantities of “high quality” heroin from the Sierra Blanca area then selling it in Midland and Odessa.  One defendant, 59-year-old Rogelio Villa, Sr., remains a fugitive.  Upon conviction, the defendants charged in these three indictments face sentences of up to 20 years in federal prison or between five and 40 years in federal prison depending on the amount of heroin involved.

The other indictment (Martinez, et al.) focuses on cocaine trafficking in the Midland area.  In this indictment, ringleader Jesse “Chuy” Martinez, along with 30–year-old Julio Rodriguez, and 34-year-old Alexander “Hondo” Castillo, all of Midland, are charged with one count of conspiracy to distribute cocaine.  Authorities allege that from April to December of last year, Martinez, Rodriguez and Castillo were responsible for the distribution of user quantities of cocaine totaling approximately five kilograms throughout the Midland area.  Upon conviction, each faces between five and 40 years in federal prison.

Thirteen (13) who were arrested yesterday face state drug charges.  Those charges are being pursued by the Midland County District Attorney’s Office.

“Through our partnerships with federal, state, and local law enforcement agencies, we are targeting local trafficking networks responsible for the illegal distribution of heroin, cocaine, methamphetamine and other dangerous drugs.  This investigation serves as a compelling example of our joint success and demonstrates the value of multi-agency collaboration.  The resulting indictments, arrests and seizures will have a positive impact in the community, where the distribution and abuse of illegal drugs can have devastating health and societal effects.  We will continue to work together to pursue drug trafficking organizations at every level in an effort to make our cities and neighborhoods safer,” stated DEA Special Agent in Charge Joseph A. Arabit.

These charges and arrests resulted from investigations conducted by the Drug Enforcement Administration and the Midland Police Department together with the Federal Bureau of Investigation, Homeland Security Investigations, U.S. Marshals Service and the Ector County Sheriff’s Office.  The Texas Department of Public Safety, Odessa Police Department, Midland County Sheriff’s Office and the U.S. Probation Office assisted in making yesterday’s arrests.

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 this morning, convicted felon Eloy Olivares Garza was sentenced to 15 years in federal prison followed by five years of supervised release for conspiring to smuggle approximately 220 assault-type firearms into Mexico announced U.S. Attorney Robert Pitman, HSI Special Agent in Charge Janice Ayala and ATF Special Agent in Charge Robert Elder.

On September 12, 2013, Garza pleaded guilty to one count of conspiracy to smuggle goods from the U.S. and one count of being a convicted felon in possession of a firearm.  According to court records, from August 2006 to February 2007, Garza conspired with others to illegally purchase the firearms from licensed dealers in and around San Antonio and Austin, then smuggle them into Mexico without receiving the appropriate licenses from the United States Department of State.  Garza’s criminal history includes a 1990 conviction for conspiracy to possess with intent to deliver marijuana. 

This case resulted from an investigation by Homeland Security Investigations together with the Bureau of Alcohol, Tobacco, Firearms and Explosives.

Assistant United States Attorneys Mark Roomberg prosecuted this case on behalf of the Government.

The United States Attorney’s Office for the Western District of Texas (WDTX) collected $15,712,319.55 in criminal and civil actions in Fiscal Year 2013 announced U.S. Attorney Robert Pitman.  Of this amount, $10,642,574.35 was collected in criminal actions and $5,069,745.20 was collected in civil actions. 

Additionally, the Western District of Texas worked with other U.S. Attorney’s Offices and components of the Department of Justice to collect an additional $203,456,628.90 in civil actions pursued jointly.  The WDTX, working with partner agencies and divisions, also collected over $8.6 million in asset forfeiture actions in FY 2013.  Forfeited assets are deposited into the Department of Justice Assets Forfeiture Fund and are used to restore funds to crime victims and for a variety of law enforcement purposes.

“In addition to securing punishment for those who break the law, it's an important part of our mission to separate them from the profits of their misdeeds and return the money to its rightful owners, whether crime victims or taxpayers,” stated United States Attorney Robert Pitman.

Notable FY 2013 WDTX collections include:

SAN ANTONIO - In April, the WDTX recovered $3,875,459.65 as part of a Health Care Fraud civil settlement with Caremark, Inc.  This amount represents the federal share of a settlement between Caremark, the Federal government and the state of Texas.  The payment was made to settle allegations that Caremark violated the False Claims Act by intentionally failing to properly process Medicaid claims for reimbursement under the Medicaid Third Party Liability statute;

EL PASO - In August, the WDTX recovered $2,855,791.04 in fines and restitution from Oswaldo Kuchle-Lopez for his role in a conspiracy to commit wire fraud by scheming to defraud the Export-Import Bank of the United States for loans purportedly involving construction vehicles and agricultural equipment destined for Mexico;

AUSTIN - In June, the WDTX collected $342,862.65 from Harris Eugene “Gene” Yarbrough, III, as part of his Court-ordered restitution of $2,150,688.26 based on his 2002 bank fraud conviction;

WACO - In August, the WDTX collected $187,556.69 in fines and restitution from High Performance Ropes of America, Inc., for their role in making false statements to the Department of Labor concerning violations of the Fair Labor Standards Act by failing to pay its workers overtime wages; and,

MIDLAND - In May, the WDTX collected $89,896.69 in restitution from Gary Gardenhire stemming from the sale of his racetrack.  The collection was applied towards his Court-ordered restitution of $2,444,165.10 based on his 2010 mail fraud conviction for scheming to steal hydraulic hoses from a Permian basin business and sell them for profit.

Attorney General Eric Holder announced on Thursday that the Justice Department collected approximately $8.1 billion in civil and criminal actions in the fiscal year ending Sept. 30, 2013.  That figure represents nearly three times the appropriated $2.76 billion budget for the 94 U.S. Attorney’s offices and the main litigating divisions in that same period.

“The department’s enforcement actions help to not only ensure justice is served, but also deliver a valuable return to the American taxpayer,” said Attorney General Holder. “It is critical that Congress provide the resources necessary to match the department’s mounting caseload. As these figures show, supporting our federal prosecutors is a sound investment.”

The U.S. Attorneys’ Offices, along with the department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the U.S. and criminal debts owed to federal crime victims.  The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss.  While restitution is paid to the victim, criminal fines and felony assessments are paid to the department’s Crime Victims’ Fund, which distributes the funds to state victim compensation and victim assistance programs.

The largest civil collections were from affirmative civil enforcement cases, in which the United States recovered government money lost to fraud or other misconduct or collected fines imposed on individuals and/or corporations for violations of federal health, safety, civil rights or environmental laws.  In addition, civil debts were collected on behalf of several federal agencies, including the U.S. Department of Housing and Urban Development, Health and Human Services, Internal Revenue Service, Small Business Administration and Department of Education.

Investigation focused on Government contracts for radiology equipment and personnel worth millions

In San Antonio this morning, New Braunfels, TX, resident Lawrence Peter Fenti and Manhattan, KS, resident Heidi Lynn Webster pleaded guilty to defrauding the United States in connection with U.S. Army contracts worth millions of dollars for medical equipment and personnel announced United States Attorney Robert Pitman.  Fenti is a 43-year-old former non-commissioned officer in charge of Base Realignment and Closure issues for Brooks Army Medical Center (BAMC) radiology.  Webster is a 50-year-old former U.S. Army officer physician and civilian contractor who specialized in radiology.

Appearing before Chief U.S. District Judge Fred Biery, Fenti and Webster pleaded guilty to one count of conspiracy and one count of bribery.  The conspiracy included intent to: defraud the United States; violate the Government conflict of interest law; commit bribery; commit wire fraud; make false claims against the United States; make false statements to federal authorities; and, commit money laundering.

By pleading guilty, the defendants admitted to conspiring together since 2007 to fraudulently secure multiple Army contracts and sub-contracts for radiology equipment and services by using Fenti’s position of influence, taking advantage of a prime contractor’s non-competitive bidding status, making false statements and fraudulent claims, as well as bribing Army personnel and Army contractors.  Those contracts included a $2 million BAMC magnetic resonance imaging (MRI) contract in June 2008, a $4.9 million BAMC MRI contract in July 2008, a $633,406.69 BAMC staffing contract in September 2008, and a $336,600 MRI contract in September 2009 for Womack Army Medical Center at Fort Bragg, NC.  Webster also admitted to paying Fenti thousands of dollars for his role in the overall scheme.

“The defendants in this case treated the American taxpayers like their own personal ATMs, rigging bids for government contracts and inflating invoices for radiology equipment and services.  This prosecution should send a message to would-be thieves that we are keeping a close watch on government contracting and when we detect fraud we will respond with the full force of the criminal law,” stated U.S. Attorney Pitman.

Per their plea agreements, Fenti and Webster face a maximum six years in federal prison.  During the investigation, authorities have seized approximately $500,000, much of which has been forfeited to the Government.  In addition, the Government is seeking a monetary judgment against Fenti in the amount of $402,485.35, as well as a $613,828 monetary judgment against Webster, representing the amount of proceeds obtained directly or indirectly as a result of their fraudulent scheme.  Sentencing will occur after the completion of a pre-sentence report by the U.S. Probation Office.

A third defendant in this case, 43-year-old John Walter Hoffman, owner/operator of Hoffman Surgical Devices, Inc. in San Antonio, is awaiting trial on charges of conspiracy to commit wire fraud, money laundering, wire fraud and making false statements to U.S. Army authorities.  Jury selection is scheduled for March 3, 2014.

This investigation was conducted by the U.S. Army Criminal Investigations Division (Army CID), the Internal Revenue Service--Criminal Investigation (IRS-CI), Defense Criminal Investigative Service (DCIS) and the Federal Bureau of Investigation (FBI).  Assistant United States Attorney James Blankinship is prosecuting this case on behalf of the Government.

Federal authorities have arrested three Permian Basin business owners and a title company executive charged in connection with a mortgage fraud scheme that involved approximately 800 real estate properties and about $45 million in loans announced United States Attorney Robert Pitman and Federal Bureau of Investigation Special Agent in Charge Douglas E. Lindquist, El Paso Division.
                        
A two-count indictment, returned yesterday and unsealed this afternoon, charges 58–year-old Stephen Mark Hilliard, owner of Comeback Properties, LLC, Hilliard Properties, LLC, SMH Properties, LTD, and Katpast Enterprises, LP; 42-year-old Michael Duraine Cowan, II, owner of TLC Properties, LLC, and MCBW Properties, LTD; 61-year-old Odessa real estate agent Cynthia Gayle Hirsch; and, 55-year-old Berta Laura McFaddin, Division Vice President of Administration for Stewart Title Company in Midland, with one count of conspiracy to commit bank fraud.  Hilliard and Cowan are also charged with one count of conspiracy to commit money laundering.

The indictment alleges that from March 2003 until August 2011, the defendants were allegedly involved in a fraudulent “same-day property flip” scheme.  According to the indictment, defendants Hilliard and/or Cowan would purchase a specific property utilizing one of their respective investment companies, then re-sell the same property on the same day at an “inflated” sales price to another Hilliard and/or Cowan investment company.  Hilliard and/or Cowan obtained mortgage loans by submitting to the bank fraudulent and misleading documentation created by the defendants and without disclosing to the bank the initial sale of the property. 

Upon conviction, each defendant faces up to 30 years in federal prison for bank fraud conspiracy.  Hilliard and Cowan also face up to 20 years in federal prison upon conviction of money laundering conspiracy.  The indictment also seeks a $27 million monetary judgment against the defendants representing the alleged proceeds derived from their fraudulent scheme.

Yesterday’s arrests and indictment resulted from an investigation conducted by the Federal Bureau of Investigation together with the Texas Department of Insurance.  “This investigation demonstrates our commitment to the community of Midland that this type of crime will not be tolerated and will be aggressively investigated,” stated FBI SAC Douglas E. Lindquist.

Assistant United States Attorney Austin Berry 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 Midland this afternoon, 36-year-old Raymond Holguin, Jr., of Odessa and 37–year-old Gustavo Pizarro of Midland were sentenced to 41 months and 18 months, respectively, in federal prison for defrauding My Community Federal Credit Union of millions of dollars announced United States Attorney Robert Pitman and Federal Bureau of Investigation Special Agent in Charge Douglas E. Lindquist, El Paso Division.

In addition to the prison term, United States District Judge Robert A. Junell ordered that Holguin pay $3,934,627 restitution and be placed under supervised release for a period of five years after completing his prison term.  Judge Junell ordered that Pizarro pay $3,914,680 restitution and be placed under supervised release for a period of five years after completing his prison term.  Judge Junell also ordered both defendants to surrender to federal authorities on or before February 18, 2014, to begin serving their prison terms.

Last year, Holguin, Pizarro and 40-year-old Michael Franco of Midland all pleaded guilty to one count of conspiracy to commit bank fraud in connection with this investigation.  According to court records, beginning in April 2007, the defendants engaged in an 18-month-long scheme that defrauded the FDIC-insured financial institution through the issuance of fraudulent car loans. Holguin, operator of Motor City, an auto dealership in Odessa, TX; Pizarro, General Sales Manager at Motor City; and, Franco, a loan officer at My Community Federal Credit Union, all devised a plan to approve car loans for customers who did not meet the credit union’s lending standards.  Holguin and Pizarro presented auto loan applications to Franco that included false information such as inflated income.  Holguin and Pizarro would also add amenities to the cars that did not exist in an effort to increase the value of the car and receive a larger loan amount.  Franco never verified any of the information contained in the loan documents before processing the loans and, in return, was paid a kickback by Holguin for every car loan that was approved.  The scheme resulted in Franco approving more than 300 fraudulent car loans on behalf of Holguin and Pizarro which led to a loss at My Community Federal Credit Union in excess of $4 million.

On November 25, 2013, Franco was sentenced to 18 months in federal prison followed by five years of supervised release and ordered to pay $4,122,532.19 restitution to the bank.  All restitution amounts ordered by the Court in this case are to be paid joint and several by the defendants. 

The case was investigated by the Federal Bureau of Investigation and was prosecuted by Assistant United States Attorney V. LaTawn Warsaw.

In Austin today, Herman G. Wilks, former Department Director of Workers’ Compensation Claims Administration for the Texas Association of School Boards, Inc. (TASB), pleaded guilty to stealing over $500,000 from the TASB’s Risk Management Fund announced United States Attorney Robert Pitman and Federal Bureau of Investigation Special Agent in Charge Armando Fernandez, San Antonio Division.

The TASB is a voluntary, non-profit, statewide educational association that serves and represents local Texas school districts, regional education service centers, community colleges, and tax appraisal districts.  One of the products and services offered by TASB to its members is the TASB Risk Management Fund. The TASB Risk Management Fund provides specific coverage to members through their requisite financial contributions into the risk management pool. This coverage can then apply with regard to unemployment compensation claims, workers' compensation claims, auto, liability and property programs. Wilks’ TASB duties included the supervision of setting up member school districts' workers' compensation claims, adjudicating medical bills and carrying out the utilization, management and pre-authorization functions required by the workers' compensation statutes. Pursuant to his title and area of responsibility at TASB, Wilks had control over and direct access to the entire claimant pay process by which TASB accepted and paid workers' compensation claims for its contributing members by way of the TASB Risk Management Fund.

Appearing before U.S. District Judge Sam Sparks this morning, Wilks pleaded guilty to ten counts of mail fraud.  By pleading guilty, Wilks admitted that from April 2008 until March 2013, he unlawfully obtained approximately $514,400 from TASB via the TASB Risk Management Fund by submitting fraudulent workers’ compensation claims on behalf of Medco Implantable Supply, a company he created for the sole purpose of carrying out his fraudulent scheme, for products and services that were never actually ordered, provided or rendered.

“Like many defendants, Mr. Wilks undoubtedly concocted his scheme of setting up a dummy company to steal hundreds of thousands of dollars from the TASB Risk Management Fund with full confidence that he would get away with it.  This prosecution should remind would-be thieves like Mr. Wilks that their schemes will be discovered and they will lose not only their ill-gotten gain, but their livelihoods, reputations and quite likely their freedom as a result,” stated U.S. Attorney Pitman.

Wilks faces up to 20 years in federal prison per count.  He is currently out on bond pending sentencing which has yet to be scheduled.

This indictment resulted from an investigation conducted by the Federal Bureau of Investigation.  Assistant United States Attorney Ashley Hoff is prosecuting this case on behalf of the Government.

This afternoon, former El Paso political consultant Antonio Dill was sentenced to ten months in federal prison followed by two years of supervised release for his role in a “pay-to-play” scheme uncovered during the ongoing public corruption investigation in El Paso announced United States Attorney Robert Pitman and FBI Special Agent in Charge Douglas E. Lindquist.

United States District Judge Frank Montalvo also ordered that the 44–year-old Dill pay a $25,000 fine.  Furthermore, Judge Montalvo ordered that Dill surrender to federal authorities on or before February 4, 2014, to begin serving his prison term.

Dill, who pleaded guilty to one count of conspiracy to commit mail fraud and deprivation of honest services, admitted that in 2007, he served as a “middle man” in a bribery scheme involving former El Paso County Judge Anthony Cobos.  According to court records, Dill received a $1,500 cash bribe which he forwarded to Cobos for his vote and influence in refinancing approximately $40 million of El Paso County debt and to terminate the then El Paso County financial advisor’s contract to be replaced with another company.

This FBI investigation has resulted in 39 federal convictions -- 36 individuals who entered guilty pleas and three individuals who were convicted by juries.

Assistant United States Attorney Debra Kanof prosecuted this case on behalf of the Government.

In San Antonio this morning, 28-year-old John Michael Hawkins was sentenced to 77 months in federal prison for possession of stolen mail and being a convicted felon in possession of a firearm announced United States Attorney Robert Pitman and U.S. Postal Inspection Service Inspector in Charge Robert Wemyss, Houston Division.

In addition to the prison term, U.S. Chief District Judge Fred Biery ordered that Hawkins pay $4,228.56 restitution and be placed under supervised release for a period of three years after completing his prison term.

In February 2013, San Antonio Police Officers arrested Hawkins.  At that time, Hawkins was in possession of stolen mail as well as a significant amount of credit cards in names other than his, various business checks, multiple personal checks, U.S. passports and Texas driver licenses.  Hawkins was also in possession of a .357 caliber revolver. 

On August 1, 2013, Hawkins pleaded guilty to the federal charges.  Hawkins’ criminal history includes state felony convictions for burglary of a habitation, unauthorized use of a vehicle, vehicle theft and evading arrest/ detention with a vehicle.

“The Postal Inspection Service has sought those who steal mail for hundreds of years. The ability to use the mail in a safe and secure manner is at the core of the Postal Inspection Service’s mission,” stated Robert Wemyss, Inspector in Charge, Houston Division. 

This case was investigated by the U.S. Postal Inspection Service, Bureau of Alcohol, Tobacco, Firearms and Explosives and the San Antonio Police Department.  Assistant U.S. Attorney Michael Hardy prosecuted this case on behalf of the Government.

This afternoon, former El Paso County Judge Anthony Cobos and Lorenzo Hilario Aguilar were each sentenced to four years in federal prison followed by three years of supervised release for their roles in a “pay-to-play” scheme uncovered during the ongoing public corruption investigation in El Paso announced United States Attorney Robert Pitman and FBI Special Agent in Charge Douglas E. Lindquist.

United States District Judge Frank Montalvo also ordered that the 46–year-old Cobos pay a $10,000 fine; the 63-year-old Aguilar, a $50,000 fine.  Furthermore, Judge Montalvo ordered Cobos and Aguilar to surrender to federal authorities on or before February 11, 2014, to begin serving their prison terms.

In September, Cobos and Aguilar each pleaded guilty to one count of conspiracy to commit mail fraud and deprivation of honest services.  By pleading guilty, the defendants admitted that in 2007, they participated in a bribery scheme involving former El Paso County Judge Anthony Cobos’ vote and influence on El Paso County contracts.  According to court records, Cobos accepted bribes in the form of cash money and other benefits, including campaign contributions to Cobos-supported individuals running for the El Paso City Council, in exchange for his vote and influence in refinancing approximately $40 million of El Paso County debt and to terminate the then El Paso County financial advisor’s contract and replace with another company.

“The sentences handed down today should reassure the public that we will be relentless in pursuing those who would attempt to corrupt public officials as well as those public officials who violate their public trust for personal gain,” stated U.S. Attorney Robert Pitman.

This FBI investigation has resulted in 39 federal convictions -- 36 individuals who entered guilty pleas and three individuals who were convicted by juries.

“Nothing destroys public confidence more than those who illegally conspire to benefit from taxpayer dollars. The FBI is committed to protecting the El Paso community by holding violators personally accountable for their actions,” stated FBI SAC Douglas E. Lindquist.

Assistant United States Attorney William F. Lewis, Jr. prosecuted this case on behalf of the Government.

A federal criminal complaint was unsealed today that charges 23–year-old U.S. Army soldier Tyler Glen Patrick with possession and transportation of stolen explosive material announced United States Attorney Robert Pitman and FBI Special Agent in Charge Armando Fernandez.

According to the criminal complaint, on December 17, 2013, federal authorities arrested Patrick in Copperas Cove, TX, after he attempted to sell a one-and-a-quarter-pound block of C-4 explosive which he previously stole following a field exercise on Fort Hood, TX.

Patrick, who remains in federal custody, faces up to ten years in federal prison and a maximum $250,000 fine upon conviction. 

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

In El Paso today, former Socorro Independent School District Trustee Guillermo “Willie” Gandara, Sr., was sentenced to 42 months in federal prison followed by three years of supervised release for using his influence with the school board to secure and retain lucrative health services contracts for ACCESS Health Source announced United States Attorney Robert Pitman and FBI Special Agent in Charge Douglas E. Lindquist.

United States District Judge Frank Montalvo also ordered that Gandara pay a $25,000 fine as well as $5,575.67 restitution to Socorro ISD.   Furthermore, Judge Montalvo ordered that Gandara self–surrender to a U.S. Bureau of Prisons designated facility on or before February 4, 2014, to begin serving his prison term.

“The sentence handed down today should reassure the public that we will be relentless in pursuing those public officials who violate their public trust for personal gain,” stated U.S. Attorney Robert Pitman.

ACCESS, among other things, was a third party administrator of healthcare benefits for self-insured entities. Between 1998 and 2007, ACCESS contracted with self-insured local (El Paso) government entities, including Socorro ISD, to provide administrative services for health insurance programs provided by their employer.  

On July 22, 2013, Gandara pleaded guilty to one count of conspiracy to commit mail fraud.  By pleading guilty, Gandara admitted that from 1998 until July 2007, he schemed to defraud the school district and deny the citizens of El Paso the right to honest services by their elected officials.  Furthermore, that Gandara knowingly aided and abetted former ACCESS CEO and President Frank Apodaca and others by performing acts in his official capacity which benefited ACCESS.

“Today’s sentencing of former SISD Trustee Guillermo Gandara, Sr., marks the final sentencing of eleven individuals who were entrusted to serve the citizens of Socorro and El Paso but instead used their positions and influence to promote their own personal interests.  This sentencing is yet another reminder of the FBI’s continued commitment to pursue individuals who have violated the public’s confidence and hold them accountable, irrespective of status,” stated FBI Special Agent In Charge Douglas E. Lindquist.

This FBI investigation has resulted in 39 federal convictions -- 36 individuals who entered guilty pleas and three individuals who were convicted by juries.

Assistant United States Attorneys Debra Kanof and Jose Luis Gonzalez are prosecuting this case on behalf of the Government.

In Austin this afternoon, 56–year-old Russell Allen Erxleben of Dripping Springs, TX, pleaded guilty to federal wire fraud and money laundering charges in connection with a Ponzi scheme that authorities believe generated more than $2 million.  As a result, Erxleben faces an agreed sentence of 90 months in federal prison plus full restitution to be determined by the Court.

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 admittedly used investment proceeds for the benefit of himself and his family, to pay 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, including one or more family members, in an effort to avoid detection by authorities. 

Internal Revenue Service-Criminal Investigation Special Agent In Charge Steven McCollough noted that all investors need to be wary when investing their hard earned money. “Investors should not allow themselves to be blinded by the quasi-celebrity status of individuals like Russell Allen Erxleben, a former University of Texas and NFL football player, when making investment decisions,” McCollough said. 

Erxleben remains in federal custody pending formal sentencing scheduled for February 24, 2014, before U.S. District Judge Lee Yeakel.

This indictment resulted from an investigation 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 are prosecuting this case on behalf of the Government. 

In San Antonio today, a federal grand jury returned an indictment charging two women with allegedly engaging in an immigration document fraud scheme for financial gain announced United States Attorney Robert Pitman and Federal Bureau of Investigation Special Agent In Charge Armando Fernandez, San Antonio Division.

A six-count indictment charges 48–year-old Yolanda Hernandez de Arteaga, owner/operator of the Los Compadres Restaurant in LaVernia, TX, and 55–year-old Maria de Lourdes Montano-Vicencio, an undocumented alien living in Houston, TX, with one count of conspiracy to commit wire fraud and five substantive counts of wire fraud.

According to the indictment, from October 2010 through December 2012, the defendants initiated a series of wire fraud schemes whereby they would induce vulnerable immigrants in the LaVernia area into giving them money in exchange for securing legal immigration status documents.  In the schemes, the defendants claimed to have personal contacts with immigration authorities who could provide each victim with items such as a social security card, a resident alien car and a work permit in about six months-time.  During the time of the conspiracy, the defendants allegedly collected over $100,000 from more than 20 immigrants desperate for legal immigration status documents.  The indictment states that on at least 22 different dates, Arteaga wired proceeds from the scheme from LaVernia to Montano-Vicencio in Houston via Western Union or MoneyGram.

The indictment further alleges that when the victim-immigrants became angry regarding the lack of documents or refund of funds, the defendants threatened to notify immigration authorities and facilitate the deportation of the immigrants if the victims made trouble.

The defendants face up to 20 years for each charge upon conviction.  The federal government is also seeking a $150,000 monetary judgment against the defendants representing the proceeds derived from their alleged scheme.

This indictment resulted from an investigation conducted by the agents with the Federal Bureau of Investigation with assistance from Homeland Security Investigations (HSI) and the LaVernia Police Department.  Assistant United States Attorney Bettina Richardson 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.

Incident resulted in the deaths of two area residents and serious injury to a third

In Del Rio this afternoon, 39-year-old David Steiner of Vinegar Bend, AL, was sentenced to 20 years in federal prison after pleading guilty to felony assault of a U.S. Border Patrol agent announced United States Attorney Robert Pitman and Rodolfo Karisch, Del Rio Sector Chief Patrol Agent, U.S. Border Patrol.

In addition to the prison term, United States District Judge Alia Moses ordered that Steiner pay $4,390 restitution to the owner of the vehicle he stole and wrecked.  Judge Moses also ordered that Steiner be placed on supervised release for a period of three years after completing his prison term.

In July, Steiner pleaded guilty to one count of assaulting, resisting, or impeding an officer by using a deadly or dangerous weapon.  By pleading guilty, Steiner admitted that on May 25, 2012, he used his vehicle to charge at three Border Patrol agents near Langtry, TX, during an attempt to avoid potential detention after fleeing from a traffic stop near Comstock, TX. 

As a result of Steiner’s actions, the agents were forced to drive off the paved roadway to avoid being struck by Steiner.  While looking for Steiner, agents came upon a vehicle accident near Sanderson, TX, wherein Steiner hit an oncoming vehicle killing two occupants and gravely injuring the driver while trying to evade law enforcement. 

This case was investigated by agents with the Department of Homeland Security – U.S. Customs and Border Protection Office of Internal Affairs with assistance from the Bureau of Alcohol, Tobacco, Firearms and Explosives, Kinney County Sheriff’s Office, Terrell County Sheriff’s Office and the Texas Department of Public Safety.  Assistant United States Attorney Ralph Paradiso prosecuted this case on behalf of the Government.

In San Antonio today, Senior U.S. District Judge David Ezra sentenced four individuals for their roles in a San Antonio methamphetamine trafficking conspiracy announced United States Attorney Robert Pitman and San Antonio Police Chief William McManus.

Judge Ezra sentenced 37-year-old Serafin Villanueva, an active member of the Hermanos Pistoleros Latinos (HPL), to 130 months in federal prison; 27-year-old James Lopez to 70 months in federal prison; 46-year-old Gilbert Guzman to 50 months in federal prison; and 26-year-old Felisha Salinas to five years of probation. 

Previously, all four defendants pleaded guilty to conspiracy to distribute a controlled substance from September 2012, until January 2013.    Court documents reveal that in September 2012, investigators with the San Antonio Police Department Gang and Intelligence Units began investigating the defendants and others connected to a methamphetamine distribution network operating out of the custom paint and auto body shop, A-1 Kustom. 

On January 28, 2013, investigators arrested Guzman, Salinas, Lopez and Villanueva following a drug transaction and seized approximately 80 grams of methamphetamine. 

In a separate, but related indictment, 41-year-old Andres Sanchez, a high ranking HPL member, was sentenced last week to 63 months in federal prison for being a convicted felon in possession of a firearm. 

Assistant United States Attorney David Shearer prosecuted this case on behalf of the Government. 

In El Paso this morning, former El Paso Independent School District Trustee Salvador “Sal” Mena was sentenced to three years in federal prison for accepting more than $176,000 in cash bribes in exchange for his vote and official influence announced United States Attorney Robert Pitman and FBI Special Agent in Charge Douglas E. Lindquist, El Paso Division.

In addition to the prison term, United States District Judge Frank Montalvo ordered that Mena forfeit to the federal government $176,455 and be placed under supervised release for a period of three years after completing his prison term.  Mena was remanded into federal custody following today’s hearing. 

Previously, Mena pleaded guilty to conspiracy to commit mail and wire fraud, and deprivation of honest services.  By pleading guilty, Mena admitted that he set up a sham consulting contract with an EPISD vendor whereby he received income, but provided no consulting services.   Additionally, in exchange for his vote, support and influence for vendors, he instructed vendors seeking to do business with EPISD to make contributions to his election and re-election campaigns.

This morning, Judge Montalvo also sentenced former El Paso resident Christopher Chol-Su Pak, to three years of probation and ordered him to pay a $20,000 fine for helping former El Paso businessman Roberto “Bobby” Ruiz in carrying out his bribery scheme which focused on a $40 million El Paso County debt refinancing contract.  Earlier this month, Ruiz received a two-year federal prison term and a $175,000 fine for his role in the scheme.

In sentencing Pak to a term of probation, Judge Montalvo took into consideration the Government’s recommendation regarding Pak’s sentencing based on Pak’s expeditious cooperation with the Government and minimal benefit as a result of the corrupt conduct. 

“Today’s sentencing of Mr. Mena and Mr. Pak demonstrates the FBI’s unwavering commitment to target those individuals involved in public corruption in the El Paso community.  Entrusted to serve the citizens of El Paso, Mena and Pak instead used their influence to promote their own personal interest,” stated FBI Special Agent in Charge Douglas E. Lindquist.

This FBI investigation has resulted in 39 federal convictions -- 36 individuals who entered guilty pleas and three individuals who were convicted by juries.

Assistant United States Attorneys Debra Kanof and Jose Luis Gonzalez prosecuted this case on behalf of the Government.

In Del Rio, 63-year-old Jose Luis Aguilar of Eagle Pass, TX, was sentenced to 14 months in federal prison for aiding and abetting bulk cash smuggling announced United States Attorney Robert Pitman and FBI Special Agent in Charge Armando Fernandez.

In addition to the prison term, United States District Judge Alia Moses ordered that Aguilar pay a $1,000 fine and be placed under supervised release for a period of three years after completing his prison term. On March 27, 2013, Aguilar pleaded guilty to the charge admitting that on January 4, 2011, he and co-defendant, David Gelacio, brought a total of $13,000 in U.S. Currency from Mexico through the Eagle Pass Port of Entry without declaring it to federal authorities. Aguilar also admitted that the money represented proceeds from the sale of a truck owned by a former Maverick County commissioner.

On July 8, 2013, Gelacio was sentenced to one year in federal prison with credit for time served followed by three years of supervised release after pleading guilty to the same charge.

This ongoing investigation is being conducted by the Federal Bureau of Investigation and the Texas Department of Public Safety. Assistant United States Attorney Michael Galdo is prosecuting this case on behalf of the Government.  

In San Antonio this morning, United States District Judge Xavier Rodriguez sentenced 31-year-old Luis Moreno to 95 years in federal prison followed by a lifetime of supervised release for the sexual exploitation of a child announced United States Attorney Robert Pitman and Federal Bureau of Investigation Special Agent In Charge Armando Fernandez.

In August, Moreno pleaded guilty to an indictment charging him with twelve counts of production of child pornography, two counts of receipt of child pornography and two counts of possession of child pornography. 

According to court records, on various occasions between April 2010 and his arrest in September 2011, Moreno used minors to engage in sexually explicit conduct for the purpose of producing visual depictions of such conduct.  Testimony during today’s sentencing hearing revealed that Moreno initially used his cell phone, then when the memory was full, a children’s electronic game device to capture, store, receive and distribute hundreds of images of child pornography.

Following today’s hearing, Judge Rodriguez issued a “no contact” order prohibiting Moreno from having any contact with the victims of these offenses.

This investigation was conducted by the Federal Bureau of Investigation and investigators from the Bexar County Sheriff’s Department— both members of the San Antonio Child Exploitation Task Force.  Assistant United States Attorneys Bettina Richardson and Tracy Thompson prosecuted this case on behalf of the Government.

In El Paso this morning, United States District Judge Kathleen Cardone sentenced 46-year-old habitual drug trafficker Benito Martinez, Jr., (a.k.a. “Benny”) to three concurrent life imprisonment terms on federal drug trafficking charges announced United States Attorney Robert Pitman and Drug Enforcement Administration Special Agent In Charge Joseph Arabit.

In October, a federal jury convicted Martinez of conspiracy to possess with intent to distribute five kilograms or more of cocaine and two counts of aiding and abetting the possession with the intent to distribute five kilograms or more of cocaine.  Evidence presented at trial revealed that Martinez had well-established relationships with individuals in the Republic of Mexico with direct ties to a Mexico-based drug cartel operating in and around Guadalajara, Jalisco, Mexico, and was responsible for large amounts of cocaine transported from Juarez through El Paso and on to Connecticut, New York and Chicago. 

At sentencing, Judge Cardone considered Martinez’s criminal history which included a five-year federal prison term beginning in 1992 for marijuana importation and a nearly 11-year federal prison term for conspiracy to possess a controlled substance with intent to distribute in 2002.  According to court records, Martinez continued his drug trafficking efforts even prior to the expiration of his terms of supervised release following each prison term.  Judge Cardone also ordered that Martinez pay a monetary judgment in the amount of $112,000, representing the value of a property in El Paso that Martinez used in furtherance of his drug trafficking crimes.

This Organized Crime Drug Enforcement Task Force (OCDETF) investigation was conducted by agents with the Drug Enforcement Administration along with assistance from other federal, state and local law enforcement agencies in El Paso, New York, Chicago and Connecticut.  

A federal grand jury has indicted 52–year-old DTS Medical Supply Company owner Daniel Thomason Smith and two employees, in connection with an estimated $3.5 million Health Care Fraud scheme announced United States Attorney Robert Pitman, FBI Special Agent in Charge Armando Fernandez and Texas Attorney General Greg Abbott.

A 21-count indictment returned yesterday in San Antonio charges Smith; 42-year-old DTS office manager Kathleen Marina Kelly-Tuorila of Devine, TX, and 57–year-old Robin Renee Haigler of Waco, TX, with one count of conspiracy to commit Health Care Fraud, one count of aiding and abetting Health Care Fraud, eleven counts of aiding and abetting aggravated identity theft and eight counts of aiding and abetting false statements related to a Health Care matter. 

According to the indictment, both Medicare and Medicaid provide qualified beneficiaries with financial remuneration for the purchase of prescribed and necessary medical equipment. Such medical equipment would include powered wheelchairs, powered scooters and accessories related to those two devices. Medicare and Medicaid set a rate of compensation for each of these devices and the rate of compensation differed between devices and was to be based on the type of device that was prescribed for the beneficiary and delivered to the beneficiary.

The indictment alleges that between May 2006 and January 2010, the defendants conspired to submit numerous false and fraudulent benefit claims to Medicaid and Medicare seeking compensation for powered wheelchairs.  Smith employed Haigler on a commission basis to recruit customers primarily in the Waco area.  At Smith’s direction, Haigler filled out benefit claims for customers that contained false information, including fraudulent prescriptions which she oftentimes generated, and then forwarded those claims to Kelly-Tuorila for submission to Medicaid and Medicare for reimbursement.  Haigler would then arrange to deliver a “power scooter,” an item which has a lower Medicaid/Medicare reimbursable rate, to customers instead of the powered wheelchair that Medicaid and Medicare were billed for.  This resulted in a larger payment from Medicaid/Medicare and a larger percentage of profit for DTS and Smith.

Upon conviction, the defendants face up to ten years imprisonment on the conspiracy count; up to ten years imprisonment on the aiding and abetting Health Care Fraud count; up to two years in federal prison for each aggravated identity theft count; and, up to five years in federal prison for each false statement count. 

This indictment resulted from an investigation conducted by the agents with the Federal Bureau of Investigation together with investigators from the Texas Medicaid Fraud Control Unit.  Assistant United States Attorney Greg Surovic 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, 45-year-old Johnny Kirk of Oklahoma City, OK, admitted to his role in the March 2010 robbery of the Lee Michaels Jewelry Store announced United States Attorney Robert Pitman and FBI Special Agent In Charge Armando Fernandez, San Antonio Division and San Antonio Police Chief William McManus. 

Appearing before United States Magistrate Judge Pamela Mathy this morning, Kirk pleaded guilty to one count of aiding and abetting the transportation of stolen goods and one count of aiding and abetting the interference with commerce by threats and violence.  Kirk remains in federal custody pending sentencing which is scheduled for 9:30am on March 3, 2014, before Senior United States District Judge David Ezra.

By pleading guilty, Kirk admitted that on March 24, 2010, he robbed the Lee Michaels Jewelry Store located in North Star Mall in San Antonio in which an estimated $2.3 million worth of merchandise was stolen.

On October 7, 2013, 47-year-old co-defendant Marvin Steel of Oklahoma City was sentenced to 20 years in federal prison and ordered to pay $1,174,134 restitution after pleading guilty to one count each of aiding and abetting the transportation of stolen goods, aiding and abetting the interference with commerce by threats and violence, and aiding and abetting the use and carrying of a firearm during a crime of violence.

Several months following the robbery, the investigation turned to Oklahoma when a Rolex watch stolen during the heist was sold. Authorities subsequently executed several search warrants in Oklahoma, including a search warrant at Marvin Steele’s residence and a search warrant at the residence of Marvin Steele’s brother.  Agents recovered Rolex watches and various pieces of jewelry, valued at approximately $800,000, stolen from Lee Michaels Jewelry Store in San Antonio as well as a blue laundry bag identical to those used during the robbery.

This investigation was conducted by the FBI/SAPD Safe Streets Task Force along with the Oklahoma FBI and the SAPD Robbery Unit.  Assistant United States Attorneys Tom Moore and Michael Hardy are prosecuting this case on behalf of the Government.

In San Antonio, 48-year-old Pierre Koutani of Houston, TX, faces up to five years in federal prison after pleading guilty this afternoon to making a false statement to a financial institution in relation to a $350,000 auto loan scheme announced United States Attorney Robert Pitman and FBI Special Agent In Charge Armando Fernandez, San Antonio Division.

By pleading guilty, Koutani admitted that in July 2010, he obtained nine car loans totaling $350,368 utilizing false and fraudulent employment information.  According to court records, Koutani falsely claimed he had been a long-time account manager for a Houston-based mortgage company earning between $11,000 and $12,000 a month.  Koutani sold many of the vehicles he obtained loans for to unsuspecting purchasers without disclosing the bank liens.  Koutani defaulted on all but one of the loans.

Koutani remains on bond pending sentencing which is scheduled for March 5, 2014, before United States District Judge Xavier Rodriguez.

This investigation was conducted by agents with the Federal Bureau of Investigation.  Assistant United States Attorney Tom Moore prosecuted this case on behalf of the Government.

Today, federal and local authorities arrested four gang members in Gonzales, TX, based on grand jury indictments returned on Wednesday alleging federal drug and firearms violations announced United States Attorney Robert Pitman, ATF Special Agent in Charge Robert Elder, Houston Division, and Gonzales Police Chief Tim Crow.

Those arrested based on federal grand jury indictments unsealed today include:

• 28-year-old Randon Romero, believed to be affiliated with the Texas Mexican Mafia, charged with one count each of felon in possession of a firearm or ammunition, carrying firearms during and in relation to a drug trafficking crime, and possession with intent to distribute methamphetamine;
• 33-year-old Tyrone Stovall, believed to be a member of the Bloods gang, charged with one count each of felon in possession of a firearm or ammunition, carrying firearms during and in relation to a drug trafficking crime, and possession with intent to distribute crack cocaine;
• 33-year-old Mario Banda, believed to be a member of the Texas Syndicate, charged with one count of possession with intent to distribute methamphetamine; and,
• 28-year-old Roman Gabriel Luna, believed to be a member of the Texas Syndicate, charged with one count each of felon in possession of a firearm or ammunition and possession with intent to distribute methamphetamine.

“One of the best ways that federal authorities can effectively partner with local law enforcement is to use our resources to help remove violent and repeat offenders from the community for longer periods of time,” stated United States Attorney Robert Pitman.

Upon conviction, felon in possession of a firearm or ammunition calls for a maximum ten years imprisonment; carrying a firearm during a drug trafficking crime, a mandatory consecutive minimum of five years imprisonment; and, possession with intent to distribute a controlled substance, up to 20 years imprisonment. 

All four defendants are scheduled to make their Initial Appearances at 3:00pm today before United States Magistrate Judge Henry J. Bemporad in San Antonio.  

These charges resulted from an investigation conducted by the agents with the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) together with investigators from the Gonzales Police Department.    Assistant United States Attorney Sarah Wannarka 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 El Paso, 33-year-old Thomas Daly, a former machine operator for a local food producer, was sentenced to 188 months in federal prison followed by ten years of supervised release for downloading child pornography announced United States Attorney Robert Pitman and Homeland Security Investigations Special Agent in Charge Dennis Ulrich, El Paso Division. 
                     
In September 2012, a routine information technology inspection revealed that Daly was downloading and viewing child pornography over the internet using peer-to-peer file sharing networks.  A subsequent search warrant executed by HSI agents at the defendant’s residence resulted in the seizure of two computers and various DVDs, CDs, and VHS cassettes.  A forensics examination of those items revealed the presence of almost 500 videos and more than 33,000 images depicting child pornography.  On September 10, 2013, Daly pleaded guilty to one count of receipt of child pornography.

This investigation was conducted by Homeland Security Investigations in El Paso.  Assistant United States Attorney Ian Martinez Hanna prosecuted this case on behalf of the government.

In Del Rio, 52-year-old Salvador Castillon, owner of South Texas Concrete based in Eagle Pass, pleaded guilty to paying bribes to a Maverick County commissioner in order to secure county construction contracts announced United States Attorney Robert Pitman and FBI Special Agent in Charge Armando Fernandez.

Appearing before U.S. District Judge Alia Moses, Castillon pleaded guilty to one count of paying a bribe to an agent of an organization receiving federal funds.  According to court records, Castillon was awarded Maverick County construction contracts totaling $416,800 in 2010 and $148,000 in 2011.  Castillon admitted that during that time period, he paid the Maverick County Precinct 2 commissioner approximately $57,000 in return for being awarded the construction contracts.

Castillon, who remains on bond pending sentencing, faces up to ten years in federal prison and a maximum $250,000 fine.  Sentencing is scheduled for 9:00am on May 12, 2014, before Judge Moses in Del Rio. 

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 is prosecuting this case on behalf of the Government.

In Del Rio today, 41-year-old Jose Flores, III, owner of Eagle Pass-based N5 Group, LLC, (N5) pleaded guilty to a bank fraud scheme announced United States Attorney Robert Pitman and FBI Special Agent in Charge Armando Fernandez.

According to court records, the defendant, through N5, attempted to serve as raw materials transportation providers to businesses in Eagle Pass and to companies operating in the Eagle Ford Shale in South Texas.  In April 2011, N5 established a Large Fleet Accounts Receivable Financing agreement with TAB Bank, Inc in Utah.  The primary purpose of N5's account with TAB was to establish a factoring relationship between the two entities. In a factoring arrangement, a bank agrees, for a fee, to serve as the recipient of payments that are owed to a company. Once this agreement is made, the company will assign its accounts receivable to the bank. The bank will then advance a large percentage of the yet-unpaid accounts receivable to the business expecting payment. Thereafter, the bank will begin to collect payments from the customer indebted to the business. Ideally, the company expecting payment will benefit because it will obtain cash from the bank immediately and thus need not wait for its accounts to come due before receiving payment. The bank benefits as well because it charges a commission for its service as receiver of the outstanding accounts.

Appearing before U.S. District Judge Alia Moses, Flores pleaded guilty to one count of bank fraud.  By pleading guilty, Flores admitted that in July 2011, he submitted to TAB Bank a forged invoice in the amount of $51,000 for work N5 was to perform for a customer.  Pursuant to the factoring agreement, the defendant fraudulently received $35,000 from TAB Bank.  When TAB subsequently began its efforts to collect payment from the customer, it found that N5 had never done any work for that customer.  In fact, that customer owed N5 no money at all.

Flores faces up to 30 years in federal prison and a maximum $1,000,000 fine as well as $35,000 restitution to TAB Bank.  He remains on bond pending sentencing scheduled for May 12, 2014, before Judge Moses in Del Rio. 

This investigation was conducted by the Federal Bureau of Investigation and the Texas Department of Public Safety.  Assistant United States Attorney Timothy A. Duree is prosecuting this case on behalf of the Government.

In Waco this afternoon, 31-year-old Bryce Ashley Reed of West, TX, was sentenced to 21 months in federal prison followed by three years of supervised release and ordered to pay a $2,000 fine for conspiracy to make an unregistered destructive device and attempting to obstruct justice announced United States Attorney Robert Pitman and ATF Special Agent in Charge Robert W. Elder, Houston Division.

On October 10, 2013, Reed pleaded guilty to the charges.  By pleading guilty, Reed admittedly conspired with others from December 2012 until April 26, 2013, to construct and possess a pipe bomb, then attempt to conceal it from law enforcement or destroy it, thus impairing its availability for use in grand jury proceedings.  According to court records, Reed used the Internet to place orders and arrange shipments to his residence of various bomb-making components.  Reed also enlisted the assistance of another individual to construct the housing for the pipe bomb.  Once completed, Reed took possession of the pipe and stored it inside his residence along with the other components inside two ammunition cans.

According to the factual basis in this case, after the events of April 17, 2013, wherein an explosion at the West Fertilizer Company resulted in the deaths of 15 individuals and the damage and destruction to many structures within a several-block radius of the plant, Reed, whose home was affected by the blast, was staying in a motel in West.  On April 26, 2013, knowing that there was a possibility investigators might find the bomb-making components inside his residence and charge him, Reed enlisted the assistance of two individuals to travel to his home in West and retrieve the ammunition cans and bring them to him, which they did.  Reed, subsequently, provided a box containing the ammunition cans and the bomb-making materials to another individual with instructions to “get rid of this.” The individual agreed to do so and placed the box in a spare bedroom in his home in Abbott, Texas.  On May 7, 2013, the individual, for the first time, looked into the box and discovered its contents.  He immediately notified the McLennan County Sheriff’s Office who took possession of the items.

This investigation was conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives together with the McLennan County Sheriff’s Office, McLennan County District Attorney’s Office, West Police Department, Texas State Fire Marshal’s Office and Texas Department of Insurance Fraud Unit.  Assistant United States Attorneys Mark Frazier and Greg Gloff prosecuted this case on behalf of the Government.

In San Antonio this afternoon, 50-year-old Sandra Sanchez Gonzalez was sentenced to 57 months in federal prison followed by three years of supervised release and ordered to pay a $1,074,096.36 in restitution for her role in a bank fraud and identity theft scheme announced United States Attorney Robert Pitman.

On August 1, 2013, Gonzalez pleaded guilty to one count of bank fraud and one count of aggravated identity theft.  By pleading guilty, Gonzalez admitted that while employed by Allegro, LTD., from September 2006 until July 2011, she stole money from Allegro by forging the owner’s signature on company checks and also fraudulently obtained credit cards under the company name to pay for personal expenses.  Gonzalez also admitted to stealing company funds by creating fictitious company pay stubs that incorrectly reflected that her son was employed by Allegro.

This investigation was conducted by agents with the U.S. Secret Service.  Assistant United States Attorney Tom Moore prosecuted this case on behalf of the Government.

In Brownsville last night, United States District Judge Andrew Hanen sentenced 51–year-old Austin attorney Marc Garrett Rosenthal to 20 years in federal prison followed by three years of supervised release and ordered him to pay $13,288,984.00 restitution for his role in a South Texas bribery scheme announced United States Attorney Robert Pitman, Federal Bureau of Investigation Special Agent in Charge Armando Fernandez, San Antonio Division, Drug Enforcement Administration Special Agent in Charge Javier Pena, Houston Field Division, Internal Revenue Service-Criminal Investigation Acting Special Agent In Charge Bernard Butler and Brownsville Police Chief Orlando Rodriguez.

In February, jurors convicted Rosenthal of conspiring to bribe a State District Judge, bribe witnesses in both state and federal court cases, file fraudulent personal injury cases in both state and federal courts and deprive the citizens of Cameron County, Texas, of the right to honest services of an elected official.

“Marc Rosenthal and the public officials with whom he conspired not only betrayed their professional ethical obligations but actively sought to corrupt the very legal processes that were designed to do justice,” stated United States Attorney Robert Pitman.  “Sadly, innumerable honorable acts performed by honest lawyers and public officials are undone in the eyes of the public when the Marc Rosenthals of our profession violate the public trust for personal gain.”

Evidence presented at trial revealed that from November 2005 until December 2009, Rosenthal and others, including 404th Judicial District Court Judge Abel Corral Limas and former state legislator and attorney Jose Santiago “Jim” Solis, participated in a scheme in which Rosenthal directly, or facilitated by Solis, paid money and other considerations to Limas which resulted in favorable court rulings for Rosenthal & Watson clients.

The evidence also revealed that Rosenthal directed others to pay certain individuals, including funeral home directors and a public employee, for the referral of plaintiff’s personal injury cases; make arrangements to manipulate the random case assignment system at the Cameron County District Clerk’s Office so that cases were filed in Courts preferred by Rosenthal & Watson; and, pay witnesses to provide false testimony and statements.

Rosenthal was convicted of one count of conspiracy to violate the Racketeering Influenced Corrupt Organization (RICO) statute; five counts of mail fraud; three counts of tampering with witnesses or proceedings; one count of extortion; and, three counts of mail fraud, aiding and abetting and deprivation of honest services.  At sentencing, Judge Hanen set aside two of the counts of conviction, both mail fraud counts.

This investigation was conducted by the FBI, DEA, IRS-Criminal Investigation and the Brownsville Police Department.  Former Southern District of Texas Assistant United States Attorney Michael Wynne and Southern District of Texas Assistant United States Attorney Oscar Ponce prosecuted this case on behalf of the Government.

In El Paso this morning, Roberto “Bobby” Ruiz, a former representative for New York–based financial services firm Bear Stearns, was sentenced to two years in federal prison followed by three years of supervised release for his role in a “pay-to-play” scheme uncovered during the ongoing public corruption investigation in El Paso announced United States Attorney Robert Pitman and FBI Special Agent in Charge Douglas E. Lindquist, El Paso Division.

United States District Judge Frank Montalvo also ordered that Ruiz pay a $175,000 fine and to self-surrender to the Dallas office of the U.S. Marshals Service on January 7, 2014, to begin serving his prison term. 

In sentencing Ruiz below the applicable advisory U.S. Sentencing Guidelines, Judge Montalvo took into consideration the Government’s request to the Court to acknowledge Ruiz’ lengthy, extensive and beneficial assistance to the Government in the El Paso public corruption investigation as well as his assistance to other state and federal initiatives in other jurisdictions. 

Judge Montalvo also sentenced former El Paso city representative and attorney, Raymond Telles, this morning to five years of probation and ordered Telles to pay a $4,000 fine for his role in the conspiracy. 

In sentencing Telles to a term of probation, Judge Montalvo took into consideration the Government’s recommendation regarding Telles’ sentencing based on Telles’ expeditious cooperation with the Government, within one month of learning he was under investigation, and Telles’ truthful and complete cooperation.  In addition, the Judge recognized Telles’ minimal benefit as a result of corrupt conduct.  According to counsel for Telles, the defendant voluntarily surrendered his Texas law license in 2009 and has no intent to practice law in the future.

Previously, Telles and Ruiz pleaded guilty to conspiracy to commit mail and wire fraud, and deprivation of honest services.  By pleading guilty, both admitted to conspiring to participate in a bribery scheme in an effort to secure a $40 million El Paso County debt refinancing contract.

“The sentencing of Mr. Ruiz and Mr. Telles are a reminder that those who illegally conspire to profit from taxpayer dollars will have to answer to the people of El Paso,” stated FBI Special Agent in Charge Douglas E. Lindquist.

This FBI investigation has resulted in 39 federal convictions -- 36 individuals who entered guilty pleas and three individuals who were convicted by juries.

Assistant United States Attorneys Debra Kanof and Jose Luis Gonzalez prosecuted this case on behalf of the Government.

In Waco, 32-year-old Wendy Chudej (pronounced “Hoo-jay”) faces up to 20 years in federal prison after pleading guilty this afternoon to robbing a Waco bank in August 2013 announced United States Attorney Robert Pitman and Federal Bureau of Investigation Special Agent In Charge Armando Fernandez, San Antonio Division.

Appearing before United States District Judge Walter S. Smith, Chudej pleaded guilty to one count of bank robbery.  By pleading guilty, Chudej admitted that she wrote the demand note and served as the getaway driver for her husband who robbed the First National Bank of Central Texas branch on North Valley Mills Drive in Waco on August 9, 2013.  According to court records, 26-year-old Matthew Chudej entered the bank and presented a note to a teller demanding cash.  The teller complied with Chudej’s request and handed him approximately $8,000 in U.S. currency.

Both Wendy and Matthew Chudej remain in federal custody pending sentencing.   Wendy Chudej is scheduled to be sentenced on January 22, 2014.  Matthew Chudej, who pleaded guilty to the same charge on October 17, 2013, is scheduled to be sentenced on December 4, 2013. 

This investigation was conducted by the Federal Bureau of Investigation and the Waco Police Department.  This case is being prosecuted by Assistant United States Attorney Greg Gloff.

In Waco this afternoon, former U.S. Army Sergeant David J. Adams, age 38, was sentenced to 30 years in federal prison followed by five years of supervised release and fined $1,000 for the aggravated sexual abuse of a child announced United States Attorney Robert Pitman.

On September 30, 2013, a federal jury convicted Adams of one count of aggravated sexual abuse of a child.  Evidence presented during trial revealed that on multiple occasions in 2006, after Adams returned from active duty in Iraq, Adams engaged in sexually explicit activity with a child at his residence located on Fort Hood.

This investigation was conducted by the United States Army Criminal Investigation Division and the Federal Bureau of Investigation.  This case was prosecuted by Assistant United States Attorney Mary Kucera.

In Waco this afternoon, 42-year-old Michael Harrison Mathews of Cedar Hill, TX, was sentenced to 15 years in federal prison for robbing a Hillsboro, TX, bank earlier this year and for being a career criminal announced United States Attorney Robert Pitman and Federal Bureau of Investigation Special Agent In Charge Armando Fernandez, San Antonio Division.

In addition to the prison term, United States District Judge Walter S. Smith ordered that Mathews pay a $1,000 fine and be placed under supervised release for a period of three years after completing his prison term.

On October 13, 2013, Mathews pleaded guilty to one count of bank robbery.  By pleading guilty, Mathews admitted that on July 3, 2013, he robbed the Wells Fargo branch in Hillsboro, TX.  Texas Department of Public Safety troopers subsequently arrested Mathews following a 25-mile high-speed chase on Interstate 35.  At the time of Mathews’ arrest, authorities recovered approximately $730 stolen from the bank.  Mathews’ criminal history revealed that since 2005, he was responsible for a total of nine bank robberies in the Dallas area, Waco, Austin and Houston.

This investigation was conducted by the Federal Bureau of Investigation and prosecuted by Assistant United States Attorney Sean Condron.

Gregory P. Boyd faces up to nine years in federal prison after a jury in Austin convicted him last week of 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.

Last Thursday, 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 in Austin last week 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.

Boyd remains on a $25,000 unsecured bond pending sentencing scheduled for 9:00am on February 10, 2014, before U.S. District Judge Sam Sparks in Austin.

“Taxpayers need to be aware that frivolous tax arguments and schemes can land them in prison. All of these arguments have been repeatedly defeated in our courts, to include the Supreme Court.  Mr. Boyd found out the hard way that Juries understand that we all must pay our taxes to keep our society free and functioning,” 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 is being prosecuted by Assistant United States Attorney Alan Buie.

In Midland this afternoon, 21-year-old Juan Carlos Venegas, a Mexican citizen formerly living in Crane, TX, was sentenced to 11 years in federal prison followed by 20 years of supervised release for using a communication device to entice a minor to engage in sexual activity announced United States Attorney Robert Pitman and Homeland Security Investigations (HSI) Special Agent In Charge Dennis Ulrich.

On September 5, 2013, a federal jury convicted Venegas of knowingly using his cell phone on several occasions in June 2012 to entice a minor to engage in sexual activity with him.  Venegas fled to Mexico shortly after being arrested by Crane County Sheriff’s deputies in July 2012.  On February 16, 2013, approximately eight months after his initial arrest, Venegas was apprehended in Del Rio, TX, while attempting to re-enter the United States from Mexico.  He has remained in federal custody ever since.

This investigation was conducted by the Homeland Security Investigations (HSI) and the Crane County Sheriff’s Office.  The case was prosecuted by Assistant United States Attorney Austin Berry.

In Midland this morning, 41-year-old Michael Ross Franco of Midland was sentenced to 18 months in federal prison for his role in a loan scheme in which a Midland credit union sustained losses in excess of $4 million announced United States Attorney Robert Pitman and Federal Bureau of Investigation Special Agent In Charge Douglas E. Lindquist, El Paso Division.

In addition to the prison term, United States District Judge Robert A. Junell ordered that Franco pay $4,122,532.19 restitution to the bank and be placed under supervised release for a period of five years after completing his prison term.

According to court records, Franco worked as a loan officer with My Community Federal Credit Union from May 22, 2006, until October 22, 2008.  During that time, Franco knowingly issued approximately 487 fraudulent auto loans totaling in excess of $7 million.  The fraudulent auto loans, which Franco approved, contained information which overstated or misstated the customer’s income, the customer’s debt-to-income ratio and/or the customer’s credit score.  Franco, admittedly, accepted over $29,000 in kickbacks from co-conspirators for his role in the scheme.

On November 27, 2012, Franco pleaded guilty to one count of conspiracy to commit bank fraud.  Co-defendants Raymond Holguin, Jr., operator of Motor City, an auto dealership in Odessa, TX, and Gustavo Pizarro, General Sales Manager at Motor City have each pleaded guilty to the same charge and are awaiting sentencing.  Sentencing is scheduled for January 9, 2014.

This investigation was conducted by the Federal Bureau of Investigation.  The case was prosecuted by Assistant United States Attorney V. LaTawn Warsaw.

In Eagle Pass this morning, Federal Bureau of Investigation agents along with Texas Department of Public Safety investigators arrested 64-year-old Saul Lombrana, owner and operator of Fiesta Contractors based in Eagle Pass, in connection with an alleged bribery, kickback and bid-rigging scheme announced United States Attorney Robert Pitman and FBI Special Agent in Charge Armando Fernandez.

Lombrana is charged by a federal grand jury indictment returned yesterday with one count of paying a bribe to an agent of an organization receiving federal funds.  According to the indictment, in March 2011, Lombrana submitted a $14,500 bid to construct 155 linear feet of concrete drain swell on Rafael Street in Precinct 1.  Lombrana was awarded the contract.  The indictment alleges that Lombrana never constructed the concrete drain swell, but requested and received full payment for the project.  The indictment also alleges that in exchange for being awarded the contract, Lombrana paid a monetary bribe to a Maverick County employee.

In addition to indicting Lombrana, the federal grand jury sitting in Del Rio returned separate indictments against 46–year-old Alejandro Wheeler, owner and operator of TVAW, a media outlet based in Eagle Pass, and 55–year-old Marcelo Alvarez, a surveyor and consultant in Maverick County.  Alvarez surrendered to federal authorities this morning.  Authorities are still looking for Wheeler.

Wheeler is charged with one count of aiding and abetting paying a bribe to an agent of an organization receiving federal funds and one count of aiding and abetting theft concerning programs receiving federal funds.  According to his indictment, in 2010 and 2011, Wheeler and Maverick County commissioners devised a scheme to have two contractors awarded Maverick County construction contracts.  As part of the scheme, Wheeler allegedly received money from the contractors and the commissioners received bribes from the construction funds as well as discounted campaign advertising and media time.

Alvarez is charged with one count of paying a bribe to an agent of an organization receiving federal funds.  According to his indictment, from 2010 to 2012, Alvarez corruptly paid money to Maverick County officials, including two county commissioners, in order to guarantee that engineering, project management and consulting services contracts valued at approximately $800,000 were awarded to a specific company.  Alvarez, in turn, was designated as the Resident Project Representative on those projects and received payment for his services.

Upon conviction each charge calls for up to ten years in federal prison and a maximum $250,000 fine.  

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.

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 this morning, 61-year-old businessman Charles Pircher 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 McCullough. 

“This was a wide ranging and complex scheme, whose simple purpose was to steal money from company payroll by diverting tax and insurance payments all for personal enrichment.  Pircher cheated clients and the taxpayers for years,” stated United States Attorney Robert Pitman.

Appearing before United States Chief District Judge Fred Biery, Pircher pleaded guilty to a Klein tax fraud conspiracy charge and a mail fraud conspiracy charge.  According to the factual basis filed in this case, from 2002 to 2008, Pircher managed a series of Professional Employer Organizations (PEOs) based in San Antonio, including Service Professionals, which entered into staff leasing agreements with various client companies to manage their payroll and insurance programs.  By pleading guilty, Pircher admitted that he and other co-conspirators stole more than $133 Million directly from their client companies’ programs.

Pircher faces up to 20 years in federal prison on the mail fraud conspiracy charge and up to five years in federal prison on the Kline tax fraud conspiracy charge.  Sentencing has yet to be scheduled.

This investigation, conducted by the Federal Bureau of Investigation and the Internal Revenue Service-Criminal Investigation, has resulted in guilty pleas by five defendants—Pircher; John D. Walker, II; John Bean; Mike Solis; and Pat Mire.  A sixth defendant, San Antonio businessman Larry W. Kimes, is scheduled for jury selection and trial on January 23, 2014.  Kimes is charged by federal grand jury indictment with one count of Klein tax fraud conspiracy, two counts of mail fraud conspiracy, one count of money laundering conspiracy and one substantive count of money laundering.

Assistant United States Attorney Thomas J. McHugh is prosecuting this case on behalf of the Government. 

Maria Landin, age 46, of Helotes, TX, faces between 10 years and life in federal prison after a jury in Del Rio convicted her this afternoon for her role in a scheme to smuggle into the United States 878.2 grams of pure crystal methamphetamine, announced United States Attorney Robert Pitman.

Jurors convicted Landin of one count of conspiracy to import a controlled substance.   Sentencing for Landin, who remains in federal custody, is scheduled for May 5, 2014.

Evidence and testimony presented during trial revealed that on November 11, 2012, Landin hired two individuals—Paul McKinney and Anthony Cole, both of Corpus Christi, TX--to go and pick up the crystal methamphetamine in Piedras Negras, Mexico, and return to her residence in Helotes, Texas, for distribution in the San Antonio area.  On November 12, 2012, McKinney and Cole were apprehended at the Eagle Pass Port of Entry, Bridge #2, while in possession of the crystal methamphetamine. 

Testimony further revealed that the co-conspirators met at Landin’s residence in Helotes, where McKinney and Cole were given a cellular phone, cash, and instructions on how to make contact in Mexico with the source of the methamphetamine.  Landin also instructed the two couriers to conceal the drugs on their bodies using tape.  After retrieving the methamphetamine, Cole and McKinney became lost in Mexico.  Landin assisted Cole and McKinney by providing them with directions back to the Port of Entry.  Inspection at the port revealed two bundles of methamphetamine taped to Cole’s legs.  The methamphetamine had a street value of approximately $100,000.

Cole and McKinney, who remain in federal custody, have already pleaded guilty to the conspiracy charge and are awaiting sentencing in March 2014.

This investigation was conducted by Special Agents from Homeland Security Investigations (HSI), and U.S. Customs and Border Protection (CBP).  The case was prosecuted by Assistant United States Attorneys Patrick Burke and Katherine Nielsen.

Federal and state authorities have arrested seven individuals, all of whom are believed to be associated with the Folk Nation gang operating in El Paso, charged in connection with a crack cocaine distribution conspiracy announced United States Attorney Robert Pitman, Drug Enforcement Administration Special Agent In Charge Joseph A. Arabit, El Paso Police Chief Greg Allen and El Paso County District Attorney Jaime Esparza. 

Those arrested yesterday and charged federally include:  Terry Golden (aka “G”), age 44; Lachundria Aguirre (aka “Lala”), age 22; Terry Devorn Pearson (aka “P”), age 30; Ricardo Lucio (aka “Lucio”), age 46; Dominic Martin, age 36; Bryant Berryman, age 27; and, Juan Escalera, age 33.  Authorities arrested four additional individuals yesterday based on state charges.

Golden, Aguirre, Pearson and Lucio were charged in a federal grand jury indictment, returned on November 13, 2013, and unsealed today, with one count of conspiracy to possess a controlled substance with intent to distribute.  According to the indictment, Golden, Aguirre, Pearson and Lucio conspired with each other between October 2013 and September 2013, to possess with intent to distribute more than 28 grams of crack cocaine.

Martin, owner of the In The Cutt Barbershop and Salon in El Paso, and Berryman and Escalera are charged in separate criminal complaints filed yesterday.  Martin and Berryman are charged with possession of a controlled substance with intent to distribute; Escalera, with re-entry after deportation.  According to one criminal complaint, Martin himself, and also through an associate, sold a total of approximately 27 grams of crack cocaine to individuals acting in an undercover capacity earlier this year.  Berryman is alleged to have been in possession of cocaine following a traffic stop on October 2, 2013.  Escalera is alleged to have illegally re-entered the United States after being formally deported on January 9, 2007.

“This investigation, which was conducted jointly between DEA, the El Paso Police Department and other federal, state and local law enforcement agencies, targeted a gang-affiliated drug trafficking network responsible for the distribution of crack and powder cocaine in the El Paso area.  The arrests of gang members and their associates further our efforts to stem the local drug trade and prevent gang-related violence and other crime,” stated DEA Assistant Special Agent In Charge Steve Whipple, El Paso Division.  “DEA and our law enforcement partners will continue to work together to pursue those who threaten the safety of the communities in which we work and live,” he added.

All of the defendants who face federal charges remain in custody at this time.  Upon conviction, each indicted defendant faces between five and 40 years in federal prison; Martin and Berryman each face up to 20 years in federal prison; and, Escalera faces up to two years in federal prison.

These charges resulted from a DEA El Paso Division Strike Force II investigation.  The Strike Force is made up of investigators from the DEA, Homeland Security Investigations (HSI), U.S. Border Patrol, U.S. Marshals Service, El Paso Police Department and the El Paso County Sheriff’s Department.  Agents from the Federal Bureau of Investigation, Bureau of Alcohol, Tobacco, Firearms and Explosives, U.S. Postal Inspection Service, U.S. Customs and Border Protection and Child Protective Services assisted in making the arrests. 

According to Lt. Tyler Grossman of the El Paso Police Department, “Forty-seven confirmed gang members have been arrested over the past year, utilizing 4,000 man hours, which was made possible through the Stonegarden Grant.  The Stonegarden Grant calls for cooperation of agencies to fight border violence and these arrests are proof of the successful partnership demonstrated by EPPD, DEA, FBI, US Marshals, Border Patrol and others.”

In addition to the arrests, this operation has resulted in the seizure of 190 grams of crack cocaine, 30 grams of cocaine, two firearms and more than $24,000 in U.S. currency. 

An indictment, or a criminal complaint, 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.

Baptist Health Systems, one of the largest health care providers in San Antonio, has paid $3,675,000 to the United States Department of Justice to settle allegations that it violated the federal False Claims Act by filing false claims for reimbursement under the Medicare program United States Attorney Robert Pitman announced today. 

The federal investigation was triggered by allegations contained in a whistleblower lawsuit filed by Norma Rivera in United States District Court in San Antonio.  The lawsuit alleged that Baptist Health Systems improperly filed claims with the Medicare program by failing to disclose on the claim that the patient receiving treatment had another insurance policy that covered the care at Baptist.  The suit further alleged the Medicare program overpaid Baptist Health Systems on claims from 2003 through 2007.   Under the law, a health care provider is required to disclose the fact that a patient has other insurance when it files its claim with Medicare.  The claim is processed under the other insurance policy and, in most cases, Medicare pays whatever the patient was out of pocket (such as a deductible or copayment).   If the health care provider receives a double payment because the insurance company is slow to pay, then the health care provider must reimburse Medicare.

United States Attorney Pitman stressed that Baptist Health Systems cooperated with the investigation, including conducting an audit of claims going back to January 2003.  The audit was disclosed to the United States Attorney’s Office, allowing the government and Baptist to reach an acceptable settlement.  Assistant United States Attorney Harold E. Brown, Jr., from the Affirmative Civil Enforcement Unit investigated the case and negotiated the settlement.  

The False Claims Act provides that a whistleblower will receive a portion of the settlement for bringing the problem to the attention of the government.  In this case, Norma Rivera received $661,500 as her share of the settlement.  In addition to paying $3,675,000 to the Government, Baptist Health Systems paid Rivera’s attorneys’ fees and expenses.

Individuals who suspect Medicare fraud, waste or abuse are encouraged to report this information to the United States Department of Health and Human Services.  Information on how to make this report is online at http://www.medicare.gov/forms-help-and-resources/report-fraud-and-abuse/report-fraud/reporting-fraud.html.  You can also report Medicare fraud by calling 1-800-MEDICARE.

In Austin today, 34-year-old Antonio Cervantez of Austin, dubbed by law enforcement as the “Trick or Treat Bandit,” was sentenced to 11 years in federal prison followed by five years of supervised release for committing several Austin bank robberies announced United States Attorney Robert Pitman, FBI Special Agent in Charge Armando Fernandez, San Antonio Division, and Austin Police Chief Art Acevedo.

Cervantez, who has remained in custody since his arrest on May 29, 2013, received four years in federal prison for bank robbery plus a mandatory seven-year-consecutive prison term for possession of a firearm during a crime of violence.  In addition to the prison term, United States District Judge Sam Sparks ordered that Cervantez pay a combined restitution in the amount of $127,885.49 to four different financial institutions—Bank of America, Wells Fargo, Capital One and International Bank of Commerce.

“It’s hard to know what someone considers when planning and committing an armed robbery, but this case should make them think about the fact that they’ll likely spend a long time in prison if we have anything to do with it,” stated United States Attorney Robert Pitman.

In August, Cervantez pleaded guilty to the charges.  By pleading guilty, Cervantez admitted that on the afternoon of May 29, 2013, he robbed the Bank of America located on West Parmer Lane in Austin.  A bank customer, who witnessed the robbery from the drive-through banking lane, called the police and followed Cervantez after he fled the scene.  Cervantez drove to his residence in the 4300 block of Northridge where authorities subsequently arrested him and recovered approximately $30,000 stolen from the bank and a .380 caliber firearm.  According to court records, Cervantes is also responsible for committing seven other bank robberies in Austin dating back to October 2009.

“This case highlights the FBI’s commitment to working with our partners in the Central Texas Violent Crime Task Force, to aggressively investigate and prosecute dangerous serial armed bank robbers, who threaten the safety of our public,” stated FBI SAC Armando Fernandez.

This case was investigated by the Austin Violent Crime Fugitive Task Force.  The Task Force is made up of investigators from the Federal Bureau of Investigation, Austin Police Department and the Round Rock Police Department.  Assistant United States Attorney Gregg N. Sofer prosecuted this case on behalf of the Government.

In Del Rio this afternoon, 31-year-old Texas Mexican Mafia member Eliseo Sanchez, III, of Crystal City was sentenced to 70 months in federal prison for conspiring to violate the Racketeering Influenced Corrupt Organization (RICO) statute plus an additional 24 months in federal prison for violating supervised release conditions stemming from a prior alien smuggling conviction.  Sanchez is the last of 12 convicted Uvalde and Crystal City, Texas-based TMM members and associates charged in this racketeering investigation to be sentenced announced United States Attorney Robert Pitman and FBI Special Agent in Charge Armando Fernandez.

The other TMM members convicted of the RICO conspiracy received the following prison sentences:

Jorge Abel Ramirez (a/k/a “Hondo,” a/k/a “Superdope”), of Hondo and Crystal City, 240 months; Geronimo Torres (a/k/a “Jerry,” a/k/a “G”), of Uvalde, 180 months; Benito Benavides (a/k/a “Benny”), of Uvalde, 240 months; Chris Gutierrez (a/k/a “Fire”), of Uvalde, 108 months; Albert Torres (a/k/a “Terrible”), of Uvalde; 168 months; Eric Velasquez Solis (a/k/a “Kilo”), of Uvalde, 162 months; Mario Zavala, of Crystal City, 108 months;  Rodolfo Villegas (a/k/a “Rudy”), of Crystal City, 72 months;    Charles Martinez (a/k/a “Charlie”), of Crystal City, 115 months; and, Sebastian Cortinas (a/k/a “Seabass”), of Crystal City and Eagle Pass, 72 months.

Additionally, Robert Marcus Castro (a/k/a “Tiny”), of Crystal City, pleaded guilty to committing a Violent Crime In Aid of Racketeering, and was sentenced to 97 months in federal prison.

The defendants conspired to engage in a pattern of organized criminal conduct including attempted murder, retaliation against an informant, extortion, and distribution of cocaine, heroin, marijuana and methamphetamine.

As a result of the same indictment, Carlos Guerrero of Uvalde, Zachary Vasquez of Uvalde and Jose Ibarra of Uvalde all pleaded guilty and were sentenced for conspiracy to possess with intent to distribute less than 500 grams of cocaine within 1,000 feet of Robb Elementary School in Uvalde, Texas.  Guerrero was sentenced to 52 months incarceration; Vasquez to 24 months incarceration; Ibarra to 18 months incarceration.

Jorge Abel Ramirez was also found guilty of violently assaulting a prison guard while the RICO case was pending.  He received 37 months incarceration for that offense, set to run consecutive to his 240 months RICO sentence, for a total of 277 months imprisonment.

“In this case, a dozen members of a violent drug gang have been sentenced to lengthy prison terms, and the community can rest assured that we will continue to use the resources of federal law enforcement to target the most dangerous offenders in the illegal drug trade,” stated United States Attorney Robert Pitman.

This case resulted from a joint investigation by the Federal Bureau of Investigation, Texas Department of Public Safety – Criminal Investigations Division, Uvalde County Sheriff’s Office, Drug Enforcement Administration and the U.S. Marshals Service, with assistance from the Real County Sheriff’s Office, Hondo Police Department, Zavala County Sheriff’s Office and Uvalde Police Department.

In El Paso, 45-year-old Alarcon Allen Wiggins (aka “Alarcon Tha Don”), the C.E.O. of 424 Records, 1 Team 1 Family Entertainment, DBD TV and DBD Productions in Baltimore, MD, was sentenced yesterday to 212 months in federal prison for his leadership role in a forced prostitution scheme based in El Paso and Baltimore announced United States Attorney Robert Pitman and FBI Special Agent in Charge FBI Special Agent in Charge Douglas E. Lindquist.

In addition to the prison term, United States District Judge Frank Montalvo ordered that Wiggins pay $24,879.83 restitution and be placed under supervised release for a period of ten years after completing his prison term.  On August 8, 2013, Wiggins pleaded guilty to conspiracy to commit human trafficking and conspiracy to transport women for purposes of prostitution.

Alarcon and nine other Baltimore residents have been convicted and sentenced as part of this investigation.  Sentences for the other defendants ranged from probation to 186 months incarceration. 

According to court records, the defendants were involved in a scheme from January 2009 until their arrests in October 2011 which included human trafficking; transport via interstate commerce for prostitution; coercing and enticing for prostitution; and, the concealing, removing or confiscating identification documents—all for financial benefit.  Wiggins and other defendants used their ties to the music industry to recruit young women then force them to work as strippers and prostitutes while confiscating all means of communication from the victims, namely cell phones and laptop computers; confiscating all identification documents from victims; prohibiting any communication by the victims and personal interaction with anyone outside the group without the defendants’ permission or in their presence; and, collecting all victims’ earnings for the benefit of the defendants.

This case was investigated by the Federal Bureau of Investigation.  Assistant United States Attorneys J. Brandy Gardes and Daniel Crumby prosecuted this case on behalf of the government.

In El Paso, FBI agents arrested a former El Paso County Assistant District Attorney Antonio Reyes based on a federal grand jury indictment charging with conspiracy to commit wire fraud and the deprivation of honest services announced United States Attorney Robert Pitman and FBI Special Agent in Charge Douglas E. Lindquist.

The indictment, returned on Wednesday and unsealed today, alleges that from March 30, 2011, until April 15, 2011, Reyes conspired with others through text messaging to accept cash bribes in exchange for dismissing pending criminal cases.

Upon conviction, Reyes faces up to 20 years imprisonment.

“The arrest of Mr. Reyes demonstrates the FBI’s unwavering commitment to the citizens of El Paso that we will vigorously investigate allegations of public corruption in our community and bring those responsible to justice.  The citizens of this community deserve to have a sense of confidence that their tax dollars are being spent efficiently for the public good and not for the private enrichment of those in a position of trust,” stated FBI Special Agent in Charge Douglas E. Lindquist.

This indictment resulted from an investigation conducted by the agents with the Federal Bureau of Investigation.  Assistant United States Attorney William F. Lewis 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.

In Sherman, TX, this morning, Lynetta Mae Washington, formerly of the Austin area and current Denton, TX, resident, was sentenced to 63 months in federal prison for her role in an identity theft and wire fraud scheme announced United States Attorney Robert Pitman, FBI Special Agent in Charge Armando Fernandez and Internal Revenue Service-Criminal Investigation Special Agent in Charge Steve McCullough in San Antonio.

In addition to the prison term, United States District Judge Thad Heartfield ordered that Washington pay $407,448.62 restitution and be placed under supervised release for a period of five years after completing her prison term.

On November 28, 2012, Washington pleaded guilty to two counts of making false claims, one count of misuse of a Social Security Number and one count of wire fraud.  By pleading guilty, Washington admitted that in January 2007, she fraudulently assumed the identities of her father-in-law and deceased mother to present the Internal Revenue Service with two falsified 2006 Income Tax Returns in which she claimed entitlement to a total of $5,730.00 in tax refunds.  According to court records, Washington also knowingly submitted a written Renewal Application for Loan Officer License with the Texas Department of Savings and Mortgage Lending in which she fraudulently claimed her mother’s Social Security Number as hers in order for her license to be renewed.  Furthermore, Washington admitted that while working as a loan officer on behalf of one or more mortgage companies from 2006 to 2009, she collected a fee for providing fictitious employment and income information on a mortgage application in order to secure the loan

This prosecution resulted from an investigation conducted by agents with the Federal Bureau of Investigation, Internal Revenue Service-Criminal Investigation and the Texas Department of Public Safety.  The matter was prosecuted by Assistant United States Attorney Ashley Hoff. 

The case was transferred to the Eastern District of Texas from the Austin Division of the Western District of Texas for plea and sentencing due to the defendant’s residency.  United States Attorney Robert Pitman is grateful for the valuable assistance provided by the United States Attorney’s Office for the Eastern District of Texas.

In El Paso today, former ACCESS Health Source Chief Executive Officer and President Frank Apodaca and El Paso Public Relations consultant Marc Schwartz were each sentenced to eight years in federal prison followed by three years of supervised release for their roles in conspiring to engage in a racketeering scheme focusing on the now-defunct company announced United States Attorney Robert Pitman and FBI Special Agent in Charge Douglas E. Lindquist.

United States District Judge Frank Montalvo also ordered that the defendants pay restitution in the following amounts:  $4.1 million to the El Paso Independent School District (EPISD); $2,286,629.76 to the Ysleta Independent School District (YISD); and, $433,103.11 to El Paso County.  Furthermore, Judge Montalvo ordered that each defendant self–surrender to a U.S. Bureau of Prisons designated facility on or before December 18, 2013, to begin serving his prison term.

“The sentences handed down today should reassure the public that we will be relentless in pursuing those who would attempt to corrupt public officials as well as those public officials who violate their public trust for personal gain,” stated U.S. Attorney Robert Pitman.

ACCESS, among other things, was a third party administrator of healthcare benefits for self-insured entities. Between 1998 and 2007, ACCESS contracted with self-insured local (El Paso) government entities, including the County, the City and all of the local school districts, among other entities, to provide administrative services for health insurance programs provided by their employer.   

Last year, both pleaded guilty to one count of conspiracy to engage in racketeering activity (RICO).  By pleading guilty, Apodaca and Schwartz admitted to participating in a scheme involving ACCESS and others to engage in a pattern of racketeering activity, including mail fraud, wire fraud and bribery with elected and appointed members of the El Paso County Commissioners Court and elected Trustees of EPISD, YISD and the Socorro Independent School District to secure and retain lucrative health care management service contracts.  Specifically, Schwartz admitted that he carried out schemes on behalf of Apodaca, former ACCESS CEO and President and National Center for the Employment of the Disabled (NCED) Board member; ACCESS owner and NCED CEO Robert “Bob” Jones; and, El Paso attorney Luther Jones to pay bribes to elected officials, including former Socorro ISD Trustees Raymundo “Ray” Rodriguez, Guillermo “Willie” Gandara, Sr., and Charles “Charlie” Garcia; former YISD Trustees Linda Chavez and Mickey Duntley; former EPISD Trustee Salvador “Sal” Mena; former El Paso County Commissioners Elizabeth “Betti” Flores and Larry Medina; and, former El Paso County Judge Dolores Briones, for performing acts in their official capacity which benefitted ACCESS.

“The sentencing of Frank Apodaca Jr. and Marc Schwartz marks another chapter in a ten year investigation in which public confidence was betrayed by a group of elected officials and vendors who used their influence to promote their own personal greed.   It also shows the continued commitment of the FBI to aggressively pursue individuals who violated the public’s trust by holding them personally accountable for their self-serving acts,” stated FBI SAC Douglas E. Lindquist.

This FBI investigation has resulted in 39 federal convictions -- 36 individuals who entered guilty pleas and three individuals who were convicted by juries.

Assistant United States Attorneys Debra Kanof and Jose Luis Gonzalez are prosecuting this case on behalf of the Government.