District of Utah

SALT LAKE CITY – An associate of drug traffickers, who assisted two others in kidnapping a 17-year-old boy from his mother’s Utah business in August 2018 while trying to collect a heroin-related drug debt, will spend 108 months in federal prison.

Nadia Carolina Avalos, 34, of Phoenix, was sentenced Tuesday morning by U.S. District Judge David Sam. Avalos will serve 36 months of supervised release when she finishes her prison sentence. There is no parole in the federal criminal justice system.

Two other defendants in the case have also pleaded guilty to kidnapping.  Issa Jassim Al-Sadoon, 28, of Phoenix, pleaded guilty to kidnapping in March and was sentenced to 120 months in federal prison and 36 months of supervised release on July 8, 2020.  Juan Carlos Moreno Trinidad, 43, of Phoenix, pleaded guilty to kidnapping in July.  Sentencing for Moreno Trinidad is Oct. 13, 2020. His plea agreement includes a stipulated sentence of 144 months in federal prison, subject to Court approval.

“Organized crime is active in Utah. As the United States Attorney for Utah, I have made it a top priority to confront and dismantle criminal organizations. This case is a glaring example of why we must keep law enforcement pressure on drug traffickers who are drawn to our neighborhoods by an unhealthy demand for illicit drugs. A fugitive leader in a narcotics trafficking organization, operating from south of the border, directed a ransom kidnapping in an otherwise safe Utah neighborhood. As Utahns, this is something we simply cannot tolerate,” U.S. Attorney John W. Huber said today.

“As we learned in court, Ms. Avalos’s problems with the law stem from illicit drugs, which often lends itself to criminal behavior and violence,” said Special Agent in Charge Paul Haertel of the Salt Lake City FBI.  “Cases like this underscore the larger issues associated with the drug trade, which is why the FBI and our partner task forces are committed to investigating activity that afflicts our communities.”

“Because of the cooperation between the FBI, Salt Lake Police Department, West Valley Police Department and the Utah County Major Crimes Task Force, a 17-year-old victim of kidnapping was safely recovered and returned to his family. Members of a drug trafficking organization, responsible for this violent act, were apprehended due to the hard work and effort of each detective, officer, and agent involved in this case. We are thankful that victim is safe and that we had a part in this outcome. We will continue our efforts to pursue other drug traffickers operating in Utah,” Lt. Jeff Bailey, Director of the Utah County Major Crimes Task Force, said today.

As a part of her plea agreement with federal prosecutors, Avalos admitted that she came with others to Utah in August 2018 to collect a drug debt owed to Oscar Rene Chacon Lopez, aka Gio, another defendant in the case, from a woman in West Valley City.  According to a complaint filed in the case, the defendants conducted surveillance on a business in West Valley City, operated by the woman.  After they were not successful in collecting the money from the woman, Chacon, calling from Mexico, directed them to kidnap the woman’s 17-year-old son. 

According to documents filed in court, the victim was kidnapped at gunpoint by Moreno Trinidad and Al-Sadoon. Avalos, assisted by Al-Sadoon and Moreno Trinidad, kept the 17-year-old son at a hotel room in Murray while Chacon attempted to collect the drug debt from his mother.

The victim called his mother and told her he had been taken by individuals who wanted money from her.  She also received a short video of the inside of her truck demonstrating the kidnappers had also stolen her truck.  In the following hours, Chacon sent numerous typed text messages and recorded voice messages. He threatened her son and other children at her home with physical violence. Chacon made it clear he directed the kidnappers in Utah and that her son would be released only after he was paid at least $10,000, according to a complaint filed in the case.           

FBI agents, Utah County Major Crime Task Force detectives, and West Valley City police officers were able to locate the juvenile victim later that evening at a Salt Lake County hotel room and return the juvenile unharmed to his home. 

Another defendant in the case, Jeanette Mejia, 27, of Phoenix, pleaded guilty to a Felony Information in March 2020 charging her with conspiracy to distribute heroin.  She faces a sentence of between 12 and 36 months when she is sentenced Oct. 13, 2020.

Chacon, 29, a citizen of Honduras, remains a fugitive.              

This case is a part of an investigation the Utah County Major Crimes Task Force and the FBI in Salt Lake City started in early 2018 targeting a drug trafficking organization distributing primarily heroin.  The investigation revealed that Chacon managed and directed the activities of multiple co-conspirators in Utah, Arizona, and Minnesota.  In addition to this case, four other criminal cases were filed in Utah as a result of the investigation.  Several kilograms of heroin and several cash seizures have been made in connection with these prosecutions. The West Valley City and Salt Lake City police departments have assisted with the investigation.

Assistant U.S. Attorneys in the U.S. Attorney’s Office in Salt Lake City and a Deputy Utah County Attorney, designated as a Special Assistant U.S. Attorney, are prosecuting the case.

SALT LAKE CITY – A federal grand jury returned a two-count indictment Wednesday afternoon charging two individuals with possession of marijuana with intent to distribute in a pipeline drug case originating from the Utah Port of Entry off Interstate 80 near Wendover. Law enforcement officers found approximately 341 pounds of marijuana in a commercial truck they were traveling in.

“This case is unique only because of the amount of marijuana seized in a semi-truck. Every week, Utah law enforcement officers intercept loads of marijuana transiting Utah’s highways from the west coast to points east. In return, Utah officers will also intercept large bundles of drug-related cash traveling back from the east to the west coast,” U.S. Attorney John W. Huber said.  “Policy makers and voters in west coast jurisdictions have created dynamics that negatively impact public safety in Utah. Simply put, these west coast marijuana havens cannot control the black market and overproduction dynamics they have created, and Utah is left to fend for ourselves in maintaining the quality of life we enjoy.

“I remind marijuana traffickers who hope to hide amidst the camouflage of state laws that allow marijuana production: federal law prohibits your conduct and I will enforce those provisions of the law in Utah.  Marijuana traffickers may want to rethink their travel plans,” Huber said.

According to charging documents, an agent with the Utah Port of Entry made contact with the driver of the commercial semi-truck and trailer following an overweight reading at the Port of Entry.  The driver of the truck was identified with a North Carolina driver’s license as Florin Daniel Goran, 36.  Goran is a Romanian citizen. A passenger in the truck was identified as Claudia Marie De Marco, 35, of Hermosa Beach, California.

The agent at the Port of Entry conducted a commercial vehicle safety inspection.  When the agent opened the door to the vehicle during the inspection, the agent detected the odor of raw marijuana coming from inside the cab. The agent requested a Utah Highway Patrol trooper be dispatched to the Port of Entry for further investigation. The trooper also detected the odor of marijuana in the cab, the complaint alleges.

A search of the cab was conducted and a black garbage bag was located behind the driver’s seat in a passenger compartment.   The bag contained 11 clear bags with approximately 1-pound of suspected raw marijuana in each one of them.

As a part of the inspection, the Utah Port of Entry agent reviewed material noting the semi-trailer contained a shipment of Pedialyte headed to Columbus, Ohio. Opening the vent door to the trailer, the agent could smell marijuana. Another officer, who had arrived at the scene, looked through the vent door with a flashlight and could see large black garbage bags and unsecured boxes inside, the complaint alleges.

The truck was sealed and taken, along with the two suspects, to the Tooele County UHP office. A DEA Metro Narcotics Task Force officer responded to the office for further investigation and a search of the semi’s cab and trailer was conducted.

According the complaint, the trailer contained 330 packages of raw marijuana in clear and black vacuum-sealed bags, each appearing to be approximately 1-pound packages. Law enforcement officers also found 1,240 THC vape cartridges, 150 THC chocolate bars, and 126 packages of THC edibles in the trailer.  The raw marijuana tested positive for marijuana.

Goron is charged with possession of marijuana with intent to distribute in the first count of the indictment.  He faces up to 40 years in prison if convicted of the charge with a mandatory minimum of 5 years in prison.  DeMarco is charged with possession of marijuana with intent to distribute in the second count of the indictment.  She faces up to five years in prison if convicted of the charge.

Complaints and indictments are not findings of guilt.  Defendants charged in these documents are presumed innocent unless or until proven guilty in court.

The case is being prosecuted by the U.S. Attorney’s Office in Utah and an Assistant Utah Attorney General, designated as a Special Assistant U.S. Attorney. Special agents, troopers, and officers with the DEA Metro Narcotics Task Force, the Utah Highway Patrol, the Utah State Bureau of Investigation, and the Wendover Police Department are investigating the case.  An agent with the Utah Department of Transportation’s Motor Carrier Division, Wendover Port of Entry is also assisting with the case.

SALT LAKE CITY – Roberto Manuel Marquez, 43, of Tooele, pleaded guilty Monday afternoon to one count of possession of methamphetamine with intent to distribute in U.S. District Court in Salt Lake City.

Marquez, a Sureno gang member, was a fugitive from state parole when he was arrested Oct. 10, 2018, during a fugitive operation conducted by the U.S. Marshals Service’s Violent Fugitive Apprehension Team (VFAST) in the Salt Lake Valley.  The Utah Board of Pardons and Parole had issued a warrant for Marquez after he removed a GPS ankle monitor and failed to report.  The Tooele County Sheriff’s Office was also looking to talk to Marquez about a drive-by shooting in Middle Canyon in Tooele County on Oct. 3, 2018.

Task force officers developed information on Marquez’s location.  Officers attempted to initiate a traffic stop in West Valley City, but the driver of the car fled at a high rate of speed and then attempted a U turn. After law enforcement officers tried to block the vehicle, the car hit two task force cars and came to a stop. 

Marquez, who was in the passenger seat, was non-complaint, tased, and removed from the vehicle. After his arrest, officers found a key in his pocket that fit a gray lock box in the vehicle.  They found meth, heroin, plastic baggies, drug paraphernalia and $3,269 in the box.

As a part of the plea agreement, Marquez admitted he possessed 346 grams of methamphetamine and $3,269.  He agreed he was planning to distribute the methamphetamine to other people.

The plea agreement includes a stipulated sentence of 120 months in federal prison, subject to the approval of the Court. As a part of the plea agreement, federal prosecutors have agreed to dismiss a second count in the indictment, possession of heroin with intent to distribute, at sentencing.

While federal prosecutors cannot bind the State of Utah or Tooele County, parties to the federal plea agreement understand that the Tooele County Attorney’s Office will dismiss its pending case charging Marquez with discharge of a firearm during the drive-by shooting in Tooele after sentencing in the federal case.

There is no parole in the federal criminal justice system, so if the stipulated sentence is approved by the court, Marquez will serve 10 years in federal prison.

Assistant U.S. Attorneys in the U.S. Attorney’s Office in Salt Lake City are prosecuting the case.  Special agents and task force officers with the U.S. Marshals Service’s VFAST and the DEA are investigating the case.

SALT LAKE CITY – Utah resident Gordon H. Pedersen has been indicted for posing as a medical doctor to sell a baseless treatment for coronavirus (COVID-19).  According to the indictment returned by a federal grand jury in Salt Lake City late last week, Pedersen fraudulently promoted and sold ingestible silver-based products as a cure for COVID-19 despite having no evidence that his products could treat or cure the disease.

Pedersen is also alleged to have claimed to be a physician and worn a stethoscope and white lab coat in videos and photos posted on the Internet to further his alleged fraud scheme.

In a related matter, the company Pedersen previously co-owned, My Doctor Suggests LLC (My Doctor Suggests), has agreed to plead guilty to a one-count criminal information related to its false and misleading marketing of ingestible silver products as a drug treatment for COVID-19.  The company has severed ties with Pedersen and agreed to cooperate in his prosecution.  The criminal information filed Thursday in the United States District Court for the District of Utah is part of a global resolution with My Doctor Suggests that also includes a civil consent order requiring the company to cease fraudulently labeling its products and to issue full refunds to affected consumers.

“In addition to the imposition of a civil restraining order that successfully shut down fraudulent claims of a COVID-19 cure-all, Mr. Pedersen now faces criminal charges for his conduct. The federal felony allegations are serious, especially against the backdrop of this pandemic where Americans are yearning for effective relief. If proven, this conduct reveals a scheme where greed was a higher priority than conveying truth to consumers,” U.S. Attorney John W. Huber said.

 “The Department of Justice will take swift action to protect consumers from those who offer phony cure-alls for the treatment and prevention of COVID-19,” said Acting Assistant Attorney General Ethan Davis.  “We will continue to work closely with our partners at the Food and Drug Administration to quickly shut down schemes to promote and sell unlawful products during this pandemic.”

The indictment against Pedersen alleges that, beginning in early 2020, he conducted a scheme to defraud consumers throughout the United States, by falsely presenting himself as a medical doctor and promoting and selling silver products on the Internet based on fraudulent claims of protection against, and treatment for, COVID-19, in the midst of a worldwide pandemic.

According to the criminal information filed Friday, My Doctor Suggests made false and misleading claims that the company’s silver-based products could be ingested to protect against COVID-19 and the products lacked the necessary directions for use as a drug product.  The information also allege My Doctor Suggests operated without properly registering with the Food and Drug Administration (FDA).  It is anticipated My Doctor Suggests will plead guilty to a single misdemeanor count of distributing misbranded drug products in interstate commerce in violation of the Food, Drug, and Cosmetic Act.

“The FDA is actively monitoring the marketplace for fraudulent products represented as preventing, curing, or treating COVID-19. Americans expect and deserve treatments that are safe, effective and meet appropriate standards, and the agency will continue to bring to justice those who place profits above the public health during this pandemic,” said Judy McMeekin, Pharm.D., Associate Commissioner for Regulatory Affairs, U.S. Food and Drug Administration. “Today’s announcement should serve as a reminder that we will take action against those who jeopardize the health of Americans while taking advantage of a crisis.”

The Department of Justice previously sought and obtained an emergency court order in the United States District Court for the District of Utah, alleging in its civil complaint that My Doctor Suggests worked with two co-defendants, Pedersen and his company GP Silver LLC, to fraudulently promote and sell various silver products for the treatment and prevention of COVID-19. Subsequent orders temporarily enjoined Pedersen, GP Silver LLC, and My Doctor Suggests from distributing silver products as well as representing they could cure, mitigate, treat, or otherwise prevent COVID-19 or any other disease. The recent consent order permanently enjoins My Doctor Suggests LLC from making these representations, and it provides a notification and refund process for deceived consumers.   

The consent order specifically requires that My Doctor Suggests LLC permanently stop any fraudulent promotions, clearly and conspicuously disavow any statement that its silver products treat or prevent COVID-19 in future marketing materials and consumer notices, implement robust compliance measures to prevent a reoccurrence, and provide full refunds upon request to any customer who purchased its silver products under fraudulent pretenses. Affected customers can contact My Doctor Suggests LLC at (1-866- 660-9868) or refunds@mydoctorsuggests.com.

An indictment is an accusation by a federal grand jury and is not evidence of guilt.  The defendant should be presumed innocent unless and until proven guilty.

The criminal action is being prosecuted by Assistant U.S. Attorney Jacob Strain from the U.S. Attorney’s Office for the District of Utah with assistance from Trial Attorney Matt Lash from the Department of Justice, Civil Division’s Consumer Protection Branch and James Smith from the FDA’s Office of Chief Counsel.  The criminal case was investigated by the FDA’s Office of Criminal Investigations and the FBI’s Utah Field Office.

The civil enforcement action was handled by Trial Attorneys Speare I. Hodges and Sarah Williams of the Department of Justice, Civil Division’s Consumer Protection Branch and Assistant U.S. Attorney Joel A. Ferre, with support from FDA’s Office of Criminal Investigations.

Additional information about the Consumer Protection Branch and its enforcement efforts may be found at www.justice.gov/civil/consumer-protection-branch.  For more information about the U.S. Attorney’s Office for the District of Utah, visit its website at https://www.justice.gov/usao-ut.  For information about the Department of Justice’s efforts to stop illegal COVID-19-related activity, visit www.justice.gov/coronavirus.  For the most up-to-date information on COVID-19, consumers may visit the Centers for Disease Control and Prevention (CDC) and WHO websites. 

The public is urged to report suspected fraud schemes related to COVID-19 by calling the National Center for Disaster Fraud (NCDF) hotline (1-866-720-5721) or by e-mailing the NCDF at disaster@leo.gov.

SALT LAKE CITY – A federal complaint unsealed this week charges a third individual with one count of arson for allegedly setting fire to a Salt Lake City Police Department vehicle during May 30, 2020, riots in Salt Lake City.

Christopher Isidro Rojas, 28, of Salt Lake City was taken into custody Friday by members of the FBI’s Joint Terrorism Task Force (JTTF) as he left his apartment.  Law enforcement officers executed a traffic stop after he got into a car.           

The complaint alleges that on the afternoon of May 30, 2020, a peaceful protest in downtown Salt Lake City transitioned into acts of destruction and violence.  Rioters near the Salt Lake City library overturned a Salt Lake City Police Department patrol car.  Moments later, rioters set the patrol car on fire. Video footage from the event shows individuals using fire to damage and completely destroy the car. Federal authorities are charging the arson cases. 

According to the complaint, video footage from the event shows an individual, later identified by police as Rojas. The complaint alleges Rojas used a cigarette lighter to help another man, holding white fabric, light the fabric on fire. Once the fabric begins to burn, the other man threw the burning fabric toward the overturned police car.  According to the complaint, the burning cloth landed partially in the interior of the patrol car and partially on the street. Rojas is later recorded on video at the riot stating “I put the cop car on fire.  It didn’t blow up.”

In the weeks after the riot, the Salt Lake City Police Department, according to the complaint, sought help from the public identifying the man who claimed to have “put the car on fire.” The FBI in Salt Lake City also offered a reward of up to $25,000 for information leading to the arrest and conviction of two arson suspects – up to $12,500 per suspect. Law enforcement officers received tips identifying Rojas. 

Federal arson charges in the case are pending against Jackson Stuart Tamowski Patton, 26, and Latroi Devon Newbins, 28, both of Salt Lake City, who were charged earlier.  Patton remains in custody.  Although federal prosecutors requested Newbins be detained as well, he has been released from custody. 

A complaint is not a finding of guilt.  Individuals charged in a complaint are presumed innocent and entitled to a fair trial.  The charge in the complaint has a potential sentence of 20 years in prison with a minimum-mandatory sentence of five years.   

U.S. Attorney John W. Huber expressed appreciation for the coordinated effort local, state, and federal law enforcement agencies are providing as a part of the investigation. “Utah law enforcement has a strong history of working together.  The investigation surrounding the burning of the patrol car is an excellent example of agencies playing to their strengths, giving us the tools we need to investigate and prosecute this criminal conduct.”

Assistant U.S. Attorneys from the Utah U.S. Attorney’s Office are prosecuting the case. Investigating agencies include members of the FBI’s JTTF, the Salt Lake City Police Department, the ATF and the Utah Department of Public Safety. U.S. Marshals, who are members of the JTTF, assisted with the arrest of Rojas.

SALT LAKE CITY – Thomas Robbins, 65, of Heber City pleaded guilty to securities fraud and money laundering in U.S. District Court in Salt Lake City Wednesday afternoon, admitting he induced victims to invest in a fraudulent foreign currency day-trading business.

According to the plea agreement, as a part of his efforts to lull investors into a false sense of security about their investments, Robbins told them he had achieved high returns in his foreign day-trading business. In fact, Robbins lost millions of dollars and diverted investor money for his personal use and benefit. He solicited approximately 66 investors to invest around $10,354,700.69 in his scheme.

“This case presents a classic example of a Utah securities fraudster. Lie upon lie, he  created an investment opportunity that drew in dozens of investors who ended up losing more than $10 million to Mr. Robbins – who is a swindler rather than a foreign currency day trader. For all intents and purposes, the money is gone and cannot be recovered for victims,” U.S. Attorney John W. Huber said today.

“We have no shortage of fraudsters in Utah waiting to take our money. While my partners and I can deliver justice to the offenders, as we are doing in this case, the key is to avoid victimization in the first place.  I encourage everyone to apply healthy skepticism and due diligence before investing their nest eggs,” Huber said.

"Thomas Robbins did not learn his lesson from his past offenses,” said Special Agent in Charge Paul Haertel of the Salt Lake City FBI.  “Unfortunately, that’s often the reality in cases like these.  Fraudsters are master manipulators and have high rates of recidivism. The FBI and our partners will continue to go after those who steal people’s hard-earned money.  Public education and awareness is key.  When looking to invest, we urge the public to do their due diligence before investing.  Please do things like checking federal court records and the state's White Collar Crime Offender Registry online at utfraud.com.”

“You have heard it before – if something sounds too good to be true, it probably is, and that is exactly what Thomas Robbins promised, something too good to be true. Mr. Robbins defrauded investors with false promises and tales of trading algorithms, all to obtain their cash and property,” said IRS-Criminal Investigation Special Agent Tara Sullivan.  “This wasn’t the first time Mr. Robbins has done this.  You should always check on anybody who is asking for your money for an investment and make sure you have an independent third party like an accountant, lawyer or financial advisor look over the opportunity.”

Robbins admitted that he made fraudulent representations in his communication with investors in the scheme.  The false representations include telling them he had spent 11 years developing an algorithm for foreign currency trading which allowed him to average returns of 5 percent to 30 percent per month; representing to them that he worked for a bank in Germany around 2005 where he was on contract to help the bank develop algorithms for their traders to use; that he used more than 13 different brokerage firms in different countries to facilitate his foreign currency trading program; assuring them that his trading program was compliant with the laws of the Commodities Futures Trading Commission; and promising that people who invested with him would never lose more than 5 percent of the net equity in their trading account due to “stop loss” measures.

He made the false representations knowing he was not providing a legitimate investment; that he had lost nearly all of the investor money; and he was using a portion of the investor money on personal living expenses; and no significant investment returns were generated.

Robbins was charged with securities fraud and money laundering in a Felony Information filed earlier this month.  Sentencing in the case is set for Nov. 30, 2020, at 2 p.m. before U.S. District Judge Dee Benson. The potential maximum sentence for securities fraud is 20 years in prison and a fine of $250,000.  Money laundering carries a potential 10-year sentence and a fine of $250,000. 

This is Robbins’ second federal conviction for a fraud scheme.  He was sentenced to 60 months in federal prison in June 2011 and ordered to pay $2,462,207 in restitution to victim investors after pleading guilty to conspiracy in another investment fraud scheme.

Assistant U.S. Attorneys in the Utah U.S. Attorney’s Office are prosecuting the case.  Special agents of the FBI and IRS-Criminal Investigation are conducting the investigation. 

WASHINGTON – Today, President Donald J. Trump and Attorney General William P. Barr announced significant cases related to Joint Task Force Vulcan (JTFV), an initiative launched in August 2019 aimed at disrupting, dismantling, and ultimately, destroying MS-13.

President Trump and Attorney General Barr announced a number of significant cases associated with JTFV, including the first time an MS-13 member has been charged with terrorism-related offenses, a coordinated multi-district takedown of the leadership of the Hollywood clique of MS-13, and the Attorney General’s decision to seek the death penalty against an MS-13 defendant.

“In 2017, the President directed the Department of Justice to go to war against MS-13, and we did just that,” said Attorney General Barr. “In coordination with our partners at the Department of Homeland Security, the Justice Department’s law enforcement components have successfully investigated, charged, and arrested command and control elements of MS-13 responsible for murder. Joint Task Force Vulcan’s operations have significantly degraded MS-13 capabilities. While there is still work to be done, the Department of Justice remains committed to protecting Americans threatened by MS-13, and we will not rest until we have successfully defeated this transnational criminal organization.”

“Today’s announcements are the result of tremendous teamwork and coordination between prosecutors and law enforcement officers across the United States and Central America,” said JTFV Director John Durham. “MS-13 is a violent transnational criminal organization, whose criminal activities respect no boundaries. The only way to defeat MS-13 is by targeting the organization as a whole, focusing on the leadership structure, and deploying a whole-of-government approach against a common enemy.”

“This multi-district takedown of a number of high profile MS-13 leaders and members is a blow to this violent gang throughout the United States.  While we are thankful that MS-13 does not have a significant presence in Utah, we do have prosecutors with significant experience investigating and prosecuting violent gangs.  We are honored to have a prosecutor from our office participating in this targeted nationwide effort,” Utah U.S. Attorney John W. Huber said today.

In an indictment unsealed yesterday, Melgar Diaz was charged in the Eastern District of Virginia with conspiring to provide material support to terrorists; conspiring to kill or maim persons overseas; conspiring to commit acts of terrorism transcending national boundaries; conspiring to finance terrorism, and; conspiring to engage in narco-terrorism, in addition to racketeering conspiracy and drug trafficking. This is the first time that an MS-13 member has been charged with terrorism-related offenses.

Alexi Saenz was indicted in 2017 in the Eastern District of New York. It is alleged that between 2016 and 2017 he committed seven murders: the Jan. 28, 2016, murder of Michael Johnson; the April 29, 2016, murder of Oscar Acosta; the Sept. 13, 2016, murders of Kayla Cuevas and Nisa Mickens; the Oct. 10, 2016, murder of Javier Castillo; the Oct. 13, 2016, murder of Dewann Stacks, and; the Jan. 30, 2017, murder of Esteban Alvarado-Bonilla. Two of the victims were Brentwood high school students killed with a machete and baseball bat. The Attorney General has filed a Notice of Intent to Seek the Death Penalty for Saenz.

In a 24-count indictment unsealed yesterday, the Eastern District of New York, charged eight MS-13 members, including leaders of the East Coast Hollywood Program, with Racketeer Influenced and Corrupt Organization (RICO) and Violent Crimes in Aid of Racketeering (VICAR) charges related to six murders, two attempted murders, kidnapping, narcotics, and related firearms offenses.

In a 21-count indictment unsealed yesterday in the District of Nevada, 13 MS-13 members, including leaders of the “Hollywood Locos” clique and “Los Angeles Program,” were charged with various offenses including Continuing Criminal Enterprise (CCE), narcotics distribution and weapons charges.

In August 2019, Attorney General Barr created JTFV to carry out the recommendations of the MS-13 subcommittee formed under the Attorney General’s Transnational Organized Crime Task Force, which was the result of President Trump’s February 2017 Executive Order directing the Departments of Justice, State, and Homeland Security, and the Office of the Director of National Intelligence, to coordinate a whole-of-government approach to dismantle transnational criminal organizations, such as MS-13, and restore safety for the American people. The principal purpose of JTFV is to coordinate and lead the efforts of the Justice Department and U.S. law enforcement agencies against MS-13 in order to dismantle the group.

JTFV has successfully implemented the whole-of-government approach to law enforcement relating to MS-13; increased coordination and collaboration with foreign law enforcement partners, including El Salvador, Mexico, Honduras, and Guatemala; designated priority MS-13 programs, cliques and leaders, who have the most impact on the U.S., for targeted prosecutions; and coordinated significant MS-13 indictments in U.S. Attorney’s Offices across the country, such as the Eastern District of New York, the Eastern District of Virginia, and the District of Nevada.

Federal prosecutors from the Department of Justice’s National Security Division and the Criminal Division, as well as 10 U.S. Attorney’s Offices have been assigned to serve JTFV in full-time capacities: the Eastern District of New York; the Eastern District of Virginia; the District of Nevada; the Southern District of California; the District of Massachusetts; the Northern District of Ohio; the District of New Jersey; the Eastern District of Texas; the District of Utah, and; the District of Columbia. In addition, all Department of Justice law enforcement agencies are involved in the effort – the Federal Bureau of Investigation; the Drug Enforcement Administration; the Bureau of Alcohol, Tobacco, Firearms and Explosives; the U.S. Marshals Service, and; the Bureau of Prisons. The Department of Homeland Security’s Homeland Security Investigations has also played a critical role in JTFV.

Attorney General Barr would also like to thank Attorney General Raul Melara of El Salvador for the assistance of his office, as well as investigators from El Salvador’s Policia Nacional Civil, Centro Antipandilla Transnacional unit for their assistance.

SALT LAKE CITY – A Romanian citizen pleaded guilty to bank fraud in U.S. District Court in Salt Lake City Wednesday morning, admitting he and his co-conspirators devised an ATM skimming scheme that allowed them to steal the personal identifiers from at least 2,732 victims and caused a loss to the victim bank of approximately $216,157.30.

As a part of his plea agreement, Alexandru Cosmin Licsor, 38, admitted that from about Jan. 10 to about Feb. 20, 2015, he installed skimming devices equipped with magnetic card readers, data recorders, digital cameras, and batteries on some Zions Bank ATMs.  The skimming equipment collected bank customer card data and the camera recorded the PIN pad as customers entered their PINs.

After collecting the data and video recordings, Licsor’s co-conspirators created counterfeit credit and debit cards.  Licsor and others used or attempted to use the counterfeit cards on multiple occasions at non-Zions bank ATMs in Utah and other places.  For example, in February 2015, they made an $800 ATM withdrawal from a Zions Bank account without the authorization of the account holder. The co-conspirators in the case have not been identified.  

While the approximate loss amount for the scheme $216,157.30, the attempted loss amount for the fraud was $363,035.83. (The attempted loss amount includes things like attempts to withdraw more from an account that the bank would allowed.)  

The plea agreement includes an agreement that the sentence imposed in the case will be between 24 months and 71 months. The ultimate sentence is subject to the approval of the Court.  The judge can consider conduct Licsor engaged in which either was not charged, not pleaded to, or both in determining a sentence.  Sentencing in the case is set for Sept. 23, 2020.

Licsor was charged with access device fraud, bank fraud, and aggravated identity theft in a six-count superseding indictment returned by a federal grand jury in December 2016.  A warrant was issued for his arrest.  After being on the run for more than two years, he was arrested in Romania and extradited to the United States in November 2019 to face the Utah charges.

The FBI’s Cyber Task Force, which includes officers with the Utah Department of Public Safety, investigated the case.  The U.S. Department of Justice’s Office of International Affairs provided significant assistance in securing the defendant’s extradition from Romania.   

SALT LAKE CITY – A federal complaint unsealed last week charges the owner of a Utah trucking company with submitting a fraudulent loan application to get a Paycheck Protection Program (PPP) loan of $210,000 through the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

Hubert Ivan Ugarte, 52, of Draper, with the assistance of Lisa Bradshaw Rowberry, 49, of Provo, Utah, submitted a loan application to the Small Business Administration (SBA) to obtain the PPP loan, according to the complaint.

The CARES Act is a federal law enacted on March 29, 2020, designed to provide emergency financial assistance to millions of Americans suffering from the economic effects caused by the COVID-19 pandemic.  One source of relief provided by the CARES Act was the authorization of up to $249 billion in forgivable loans to small businesses for job retention and certain other expenses, through the PPP.  In April 2020, Congress authorized more than $300 billion in additional PPP funding.

The PPP allows qualifying small businesses and other organizations to receive loans with a maturity of two years and an interest rate of 1 percent.  PPP loan proceeds must be used by businesses on payroll costs, interest on mortgages, rent, and utilities.  The PPP allows the interest and principal on the PPP loan to be entirely forgiven if the business spends the loan proceeds on these expense items within a designated period of time after receiving the proceeds and uses a certain amount of the PPP loan proceeds on payroll expenses.

According to the complaint, Ugarte, with Rowberry’s assistance, answered “no” to questions on the application asking whether he was under formal criminal charges in any jurisdiction. His answer was false because he was under federal indictment in Utah when he answered the question, the complaint alleges.

On Oct. 24, 2019, a federal grand jury in Utah returned an indictment charging Ugarte and others following a multi-year wire fraud and bribery scheme investigation in which it is alleged Ugarte bribed employees at the Salt Lake City Hub of FedEx ground to obtain preferential treatment for his trucking companies.  Ugarte faces four counts of wire fraud and six counts of money laundering in the pending case.

In filling out PPP loan application documents, Ugarte also circled “no” when asked if he had ever been placed on pretrial diversion.  In fact, according to the complaint, he entered into a two-year pretrial diversion in 1988 to resolve a felony drug possession charge.

Before Ugarte and Rowberry completed the Borrower Certification for the PPP loan and submitted it to the SBA, Ugarte specifically agreed that at least 75 percent of the $210,000 loan would be used for payroll costs.

According to the complaint, the original PPP loan application was rejected or declined by two banks after they had discovered Ugarte was under federal indictment. The complaint alleges Rowberry told an individual she was going to go with a friend she knew in the banking industry to re-apply for the PPP loan. On May 14, 2020, Ugarte received $210,000 from Transportation Alliance Bank.

Instead of using at least 75 percent of the loan to pay payroll costs, including bounced payroll checks, Ugarte’s business account shows an automatic withdrawal to Kenworth Sales in the amount of $126,965.27 just four days after the loan was received.  The complaint alleges Ugarte’s company owed approximately $66,000 a month in lease or purchase payments to Kenworth for 13 tractors. Records show Kenworth received the money for truck payments and  small amount for various truck parts. The complaint alleges Ugarte used 60 percent of the loan to pay the past due truck payments – leaving 40 percent for payroll costs.

Ugarte and Rowberry are charged with conspiracy, removal of property to prevent seizure, loan application fraud, wire fraud, and money laundering in the complaint. The conspiracy and removal of property to prevent seizure counts each carry potential 5 years sentences.  Money laundering has a potential 10 year sentence and wire fraud is up to 20 years. The loan application fraud count is up to 30 years in prison and a $1 million fine.

The removal of property to prevent seizure count in the complaint alleges Ugarte received a payment of $60,957.82 for a wrecked tractor in Nevada after Rowberry submitted an insurance claim.  The check should have been turned over to the FBI subject to a seizure warrant in his FedEx fraud case. Rather than turn the money over to the FBI, the complaint alleges Rowberry deposited it into one of Ugarte’s accounts.  

Rowberry had an initial appearance last week in federal court and has been released on conditions of pretrial release.  A preliminary hearing for her is set for July 28, 2020, at 3 p.m.  before Magistrate Judge Daphne A. Oberg.  An initial appearance for Ugarte, who is in custody, is set for Tuesday (July 14, 2020) at 9 a.m. before Magistrate Oberg.

Complaints are not findings of guilt.  Individuals charged in complaints are presumed innocent unless or until proven guilty beyond a reasonable doubt in court.

Assistant U.S. Attorneys in the Utah U.S. Attorney’s Office are prosecuting the case.  FBI special agents are investigating the matter.

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

SALT LAKE CITY – The Department of Justice is awarding $2.2 million in grant funding to law enforcement agencies and stakeholders through the Department’s Office of Community Oriented Policing Services (COPS Office) Community Policing Development (CPD) Microgrants Program.

Salt Lake City is one of the 29 awards announced today by COPS Office Director Phil Keith.  The awards range in amounts from $15,090 to $100,000. Salt Lake City will receive $71,896 to support the Salt Lake City Youth Engagement Project.

“Community policing strategies are a vital tool in building relationships between law enforcement and community partners,” U.S. Attorney John W. Huber said today. “Congratulations to Salt Lake City on its efforts to develop this innovative project and earn the support of the COPS Office.”

“The CPD Microgrants Program is a critical resource to advance innovative community policing projects across the country,” said Director Keith.  “These strategic investments from the COPS Office pay huge dividends to state and local law enforcement agencies and the communities that they serve.”

CPD Microgrants Program funds are used to develop the capacity of local, state, and tribal law enforcement agencies to implement community policing strategies. Applicants were invited to propose demonstration or pilot projects to be implemented in their agency that offer creative ideas to advance crime fighting, community engagement, problem solving, or organizational changes to support community policing in one of the following areas:

• Human Trafficking
• Meeting Rural Law Enforcement Challenges
• Officer Safety and Wellness
• Recruitment, Hiring, and Retention

• School Safety
• Staffing and Allocation Studies
• Victim-Centered Approaches
• Violent Crime
• Youth Engagement
   
  Funding through this program is available for the first time since 2018, following the successful removal of a nationwide injunction. These awards are being announced at a critical time for our country, when community policing strategies can play a vital role in improving police and community relations.

SALT LAKE CITY – Denise Gunderson Rust, one of three individuals charged in connection with an alleged scheme to defraud investors by inducing them to purchase investments in a fraudulent silver trading program, pleaded guilty to money laundering in federal court late last week.

Gaylen Rust owned and managed Rust Rare Coin, Inc. (RRC), R Legacy Entertainment LLC, R. Legacy Racing Inc., R Legacy Investments LLC, R Legacy Ranch, and Legacy Music Alliance.  Denise Rust was listed as the secretary of RRC and had signatory authority on several RRC bank accounts.  Joshua Rust was manager of RRC from 2004 to Nov. 15, 2018.  He also had signatory authority on several RRC bank accounts and managed the day-to-day operations of the RRC coin shop.

The silver trading program was offered and sold to around 700 investors throughout the United States.  The defendants collected approximately $200 million.

Denise Gunderson Rust, 60, of Layton was charged in the case along with Gaylen Dean Rust, 59, of Layton and Joshua Daniel Rust, age 37, of Draper.  Cases against the two men are pending.

“Denise Rust participated in one of largest and most financially destructive frauds Utah has ever seen.  Based on this conduct, we have secured a conviction against her for laundering investor money for her own personal benefit,” U.S. Attorney John W. Huber said.  “We remain committed to seek justice for the nearly 700 victims who have suffered catastrophic economic consequences from this fraud.”

“We are pleased at these first steps toward justice in this matter,” said Thomas Brady, Director of the Utah Division of Securities.  “The U.S. Attorney’s Office has done exemplary work.

“Instead of doing the right thing, Denise Rust helped perpetuate a multi-million dollar Ponzi scheme that duped investors for more than 20 years,” said Special Agent in Charge Paul Haertel of the FBI’s Salt Lake City Field Office.  “This case shows just how convincing fraudsters can be.  We urge due diligence when looking to invest and immediately report fraud to the FBI.”

“Denise Rust knew that the millions of dollars of investors’ money she diverted into another business was from a Ponzi scheme,” said Las Vegas Field Office Special Agent in Charge Tara Sullivan.  “People who create schemes that have no purpose other than to mislead others and defraud the IRS run the very high risk of prosecution."

Denise Gunderson Rust pleaded guilty to a Felony Information charging one count of money laundering.  As a part of her plea agreement, she admitted that she conducted a money transaction using proceeds derived from unlawful activity.

She admitted that by that date, she was aware that Gaylen Rust had collected millions of dollars by offering and selling a silver trading program to many investors located throughout the United States.  She admitted knowing that Rust had misrepresented to investors that their money would be used to purchase and trade significant amounts of physical silver bullion.

On Oct. 17, 2018, Denise Gunderson Rust admitted she transferred $12,000 from a bank account in Utah, where investor money was pooled, to her daughter in Alaska.  The payment to her daughter was unrelated to the silver trading program.

The plea agreement includes an agreement that the Court will impose a sentence of between five years’ probation and 18 months in prison. The stipulated sentencing range is subject to the approval of the Court.  She has also agreed to pay restitution in the approximate amount of $1,774,357.93.  The exact amount of restitution and the schedule of payments will be determined during the sentencing hearing.  She also agreed to forfeit $12,000 in money she acquired traceable to the criminal conduct.  A sentencing date has not been set.  Denise Rust is not in custody.

The indictment charging the Rusts alleges that from around 1996 and continuing to Nov. 15, 2018, the defendants conspired to defraud investors and potential investors by offering and inducing them to purchase investments in a silver trading program.  According to the indictment, Gaylen Rust, who offered and sold investments in the program, made false and fraudulent statements regarding his scheme, both directly and indirectly, to investors and potential investors through various means including meetings, phone calls, mailings, and emails.

Among other things, the indictment alleges the defendants failed to disclose to investors that their funds would be used for purposes other than to invest in silver and trading silver; that Gaylen Rust was not licensed to sell securities, trade commodities or operate a commodity pool; that investor funds were being laundered through transfers in and out of the defendants’  personal accounts; and that investment account statements provided to investors were false and not based on actual silver trades.

In order to convince investors that their investments were profitable and to convince potential investors that the silver program was earning money, the defendants operated the trading program as a Ponzi scheme.  The defendants used investment money from later investors to pay the promised returns to earlier investors, creating the false impression that the silver trading program was profitable, the investments were safe and secure, and that the promised returns were being generated.  Ponzi payments of approximately $150 million were made to investors, representing those payments as profits from the operation of the silver trading program.

Gaylen Rust and Joshua Rust are charged with wire fraud and money laundering conspiracy in the case.  Gaylen Rust also faces two counts of securities fraud and Joshua Rust is charged with one count of money laundering.

The potential maximum penalties for wire fraud conspiracy, securities fraud and money laundering conspiracy are up to 20 years in federal prison per count. Securities fraud has a 20-year maximum sentence sand money laundering has a potential 10-year sentence.

Indictments are not findings of guilt.  Individuals charged in indictments are presumed innocent unless or until proven guilty in court.

Assistant U.S. Attorneys in Salt Lake City are prosecuting the case. Special agents with the Utah Division of Securities, the FBI, and IRS-Criminal Investigation are investigating the case.  The Securities Exchange Commission, the Commodity Futures Trading Commission, and the Utah Attorney General’s Office have filed related cases.

SALT LAKE CITY – U.S. Attorney John W. Huber announced today the appointment of Brian Speelman as the Missing and Murdered Indigenous Persons (MMIP) coordinator in Utah.

As Utah’s first MMIP coordinator, Speelman will gather reliable data to identify MMIP cases connected to Utah; conduct outreach with tribal communities to assist in the creation and implementation of community action plans; and coordinate with tribal, local, state, and federal law enforcement in the development of protocols and procedures for responding to and addressing MMIP cases.

Speelman, who will coordinate with tribal communities and serve victims throughout Utah, will work in the U.S. Attorney’s Office in Salt Lake City.

U.S.  Attorney General William Barr launched a national strategy in November to address missing and murdered Native Americans. As a part of the initiative, the Department of Justice made funding available to hire MMIP coordinators in 11 states, including Utah.

“American Indian and Alaska Native people suffer from unacceptable and disproportionately high levels of violence, which can have lasting impacts on families and communities. Native American women face particularly high rates of violence, with at least half suffering sexual or intimate-partner violence in their lifetime. Too many of these families have experienced the loss of loved ones who went missing or were murdered,” said Attorney General William P. Barr. “This important initiative will further strengthen the federal, state, and tribal law enforcement response to these continuing problems.”

“My office is fully committed to our tribal partners in Utah, and this new position will add to our combined capabilities. The position is designed to help serve crime victim families who have suffered from missing or murdered family members. It will also enable my office to better collaborate with other groups in Utah working on MMIP issues,” U.S. Attorney Huber said today.  “Brian Speelman brings decades of experience, and is committed to working with our tribal communities and other stakeholders to reduce violent crime and deliver justice.”

Prior to joining the U.S. Attorney’s Office, Speelman worked as an FBI agent, retiring as a Supervisory Special Agent in 2011.  Following his retirement, he was appointed Director of the Utah Statewide Information and Analysis Center (SIAC), which was recognized in 2015 with the Governor’s Award for Excellence in Public Services.  Most recently, Speelman worked as an associate with the Argonne National Laboratory focusing on homeland security issues.  He is a graduate of the University of Maryland.

The strategy announced in November by DOJ has three parts:

Establish MMIP coordinators: The Department of Justice is investing resources to hire 11 MMIP coordinators in 11 states to serve with all U.S. Attorney’s offices in those states, and others who request assistance. The states are Alaska, Arizona, Montana, Oklahoma, Michigan, Utah, Nevada, Minnesota, Oregon, New Mexico, and Washington. MMIP coordinators will work closely with federal, tribal, state and local agencies to develop common protocols and procedure for responding to reports of missing or murdered indigenous people.

Specialized FBI Rapid Deployment Teams: The strategy will bring needed tools and resources to law enforcement. Upon request by a tribal, state, or local law enforcement agency, the FBI will provide expert assistance based upon the circumstances of a missing indigenous persons case. FBI resources and personnel, which may be activated to assist with cases include: Child Abduction Rapid Deployment (CARD) teams, Cellular Analysis Support Teams, Evidence Response Teams, Cyber Agents for timely analysis of digital evidence/social media, Victim Services Division Response Teams, and others. MMIP coordinators will assist in developing protocols.

Comprehensive Data Analysis: The department will perform in-depth analysis of federally supported databases and analyze data collection practices to identify opportunities to improve data and share the results of this analysis with our partners in this effort.

More broadly, the MMIP Initiative will involve a coordinated effort by more than 50 U.S. Attorneys on the Attorney General’s Native American Issues Subcommittee (NAIS), the FBI, and the Office of Tribal Justice, with support from the Office of Justice Programs (OJP) and the Office on Violence Against Women (OVW).

SALT LAKE CITY – A federal complaint unsealed recently charges Andrew T. Whitehouse, age 25, of Tooele with distribution of heroin in a case where a Tooele resident, identified as J.B. in the complaint, died from a drug overdose.

According to the complaint, on Oct. 7, 2018, officers from the Tooele City Police Department responded to a residence on a call for a male who was unconscious and not breathing.  The father of the victim believed he had overdosed on drugs. Officers and emergency technicians were not able to revive him.

Officers recovered a used syringe in the bathroom sink with what appeared to be heroin residue.  They also found a needle mark on J.B.’s wrist. A small baggie, commonly used to store user amounts of heroin, and a digital scale were found.  They also found the victim’s cell phone.

A medical examiner later determined the victim died of “mixed drug and alcohol intoxication.”  The drugs included heroin metabolites (morphine and 6-monoacetylmorphine) and a by-product of heroin production (codeine).

The phone contained a text message conversation between the victim and a person identified as “Andrew” that started in the early hours of Oct. 7, 2018, with the victim asking Andrew for narcotics at 2:33 a.m.  The conversation continued – with 34 messages between the victim and Whitehouse’s phone until about 4:30 a.m. There were also 11 calls back and forth.

The victim’s body was discovered about 7:15 a.m.

According to the complaint, Whitehouse told investigators when he arrived at the victim’s home, the victim only had $13.  Whitehouse claimed the victim went back inside his home to find more money. While the victim was in the home, Whitehouse said he divided the heroin into a smaller amount to sell the victim $13 worth of heroin.  Whitehouse claims that when victim returned without any more money, he decided to leave without selling the heroin, according to the complaint. Whitehouse claimed that at about 4:30 a.m., he told the victim to buy heroin from someone else.  The victim’s phone, however, indicates he had no further contact with anyone that morning.

Whitehouse is also charged with one count of possession of child pornography and one count of distribution of child pornography in the complaint.

In June 2019, a victim disclosed to law enforcement that she had received communications from a stranger who sent her a photo of herself naked from the waist up, identified her last name, and other personal information. The individual stated that he obtained the photograph from a website. According to the complaint, the picture of the victim was posted to the website in April 2019 with the caption, “more pictures where that came from.”

The victim recognized the photo as one of several photographs taken of her engaged in sexual activity that she had sent to Whitehouse during 2012 when she was 15 years old.  According to the complaint, the victim said Whitehouse knew her age at the time and asked her to pose in sexually explicit positions. The victim said she sent Whitehouse more than 50 pictures.

According to the complaint, in July 2019, law enforcement officers executed a search warrant at Whitehouse’s residence.  A forensic review of the digital media seized from the house uncovered the photograph that the victim had been sent by the stranger. Investigators also found other photos of the 15-year-old victim.

The maximum potential sentence for distribution of heroin is 20 years in prison.  If the defendant is convicted of that charge, federal prosecutors could seek an enhancement at sentencing for the victim’s death. Distribution of child pornography has a potential maximum sentence of 20 years in prison with a five-year minimum mandatory sentence. Possession of child pornography is up to 10 years.  Whitehouse is in custody.

A complaint is not a finding of guilt.  Defendants charged in a complaint are presumed innocent unless or until proven guilty in court.

Prosecutors in the Utah U.S. Attorney’s Office are prosecuting the case.  Special agents and task force officers with the DEA are investigating the case, with assistance from the Tooele City Police Department.

SALT LAKE CITY – A federal complaint filed in federal court Wednesday morning charges Jackson Stuart Tamowski Patton of Salt Lake City with one count of arson for allegedly setting fire to a Salt Lake City Police Department vehicle during protests in Salt Lake City Saturday.

The complaint alleges that after rioters overturned a Salt Lake City patrol car during a protest in downtown Salt Lake City Saturday, the patrol car was set on fire.  According to the complaint, video footage from the riot shows Patton tossing a combustible substance onto the flames causing the flames to increase.  The fire destroyed the patrol car.

Salt Lake City police officers arrested Patton, age 26, Tuesday night at a protest event in Salt Lake City.  An initial appearance in federal court will be set later.

The complaint and arrest were announced today by John W. Huber, U.S. Attorney for Utah; Chief Mike Brown of the Salt Lake City Police Department; Paul H. Haertel, Special Agent in Charge of the Salt Lake City FBI; David Booth, ATF Special Agent in Charge for Utah; and Utah Department of Public Safety Commissioner Jess L. Anderson.

“We value and support the rights we all enjoy to peacefully demonstrate and advocate for our beliefs.  However, we have zero tolerance for those who hijack peaceful protests and commit violations of federal law,” U.S. Attorney John W. Huber said today.  “Those involved in this criminal behavior – including the conduct alleged in this complaint – should know that we will use every available tool we have to hold them accountable.”

“Our detectives worked tirelessly to ascertain the identities of numerous perpetrators of violence and destruction in our city. We too are committed to bringing to justice those who attempted to interrupt the peaceful protest,” Salt Lake City Police Chief Mike Brown said today. “We appreciate the partnerships we share with our federal agencies, to make sure that, through our shared resources, we are able to bring the correct judgment to these criminals.”

A complaint is not a finding of guilt.  Individuals charged in a complaint are presumed innocent and entitled to a fair trial.  The charge in the complaint has a potential sentence of 20 years in prison with a minimum sentence of five years.                         

SALT LAKE CITY – Five Utah agencies are receiving funding through the Department of Justice’s Office of Community Oriented Policing Services (COPS Office) COPS Hiring Program (CHP).

The Attorney General announced funding awards to 596 law enforcement agencies across the nation Tuesday afternoon, which allows those agencies to hire 2,732 additional full-time law enforcement professionals.  The COPS Office received nearly 1,100 applications requesting more than 4,000 law enforcement positions.

The City of American Fork, the Wayne County Sheriff’s Office, and the Willard Police Department will each get $125,000 to fund one officer.  The City of Orem has been awarded $375,000 to fund three officers.  Salt Lake City is getting $1,250,000 to fund 10 officers.

“The Department of Justice is committed to providing the police chiefs and sheriffs of our great nation with needed resources, tools, and support.  The funding announced today will bolster their ranks and contribute to expanding community policing efforts nationwide,” said Attorney General William P. Barr.  “A law enforcement agency’s most valuable assets are the men and women who put their lives on the line every day in the name of protecting and serving their communities.”

“This critical funding will bring 16 new law enforcement officers to agencies in Utah where they will address local needs,” U.S. Attorney John W. Huber said today. “These agencies identified specific community issues and needs where COPS funding could be effectively applied.  We appreciate the COPS Office providing funding to Utah agencies.  It will be put to good use.”

The COPS Hiring Program is a competitive award program intended to reduce crime and advance public safety through community policing by providing direct funding for the hiring of career law enforcement officers.  In addition to providing financial support for hiring, CHP provides funding to state, local, and tribal law enforcement to enhance local community policing strategies and tactics.  In a changing economic climate, CHP funding helps law enforcement agencies maintain sufficient sworn personnel levels to promote safe communities.  Funding through this program had been on hold since the spring of 2018 due to a nationwide injunction that was lifted earlier this year.

CHP applicants were required to identify a specific crime and disorder problem focus area and explain how the funding will be used to implement community policing approaches to that problem focus area.  Of the awards announced today, 43 percent will focus on violent crime, while the remainder of the awards will focus on a variety of issues including school-based policing to fund school resource officer positions, building trust and respect, and opioid education, prevention, and intervention.

To learn more about CHP, please visit https://cops.usdoj.gov/chp.  For additional information about the COPS Office, please visit www.cops.usdoj.gov.

“The Joint Terrorism Task Force (JTTF) model is exactly the right tool as we investigate potential violations of federal law during the riots in Salt Lake City this weekend, or any similar uprisings in the future. The JTTF brings together highly trained investigators from federal, state, and local law enforcement agencies.  These are already strong relationships in Utah, with a proven track record.  It makes sense to take advantage of these relationships and this expertise already in place.

“We recognize and support the rights we all enjoy to peacefully demonstrate, protest and advocate for our beliefs. These are some of the most important rights we have as Americans.

“However, we have zero tolerance for those who hijack peaceful protests to violate federal law.  In particular, our eyes are on those who use fire and arson to destroy property and any who may have traveled to Utah from out of state to riot in Salt Lake City.  We will hold accountable those who violate federal law.”

###

(U.S. Attorney Huber’s statement follows a press release issued by the U.S. Department of Justice Sunday morning saying that “to identify criminal organizers and instigators, and to coordinate federal resources with our state and local partners, federal law enforcement is using our existing network of 56 regional FBI Joint Terrorism Task Forces (JTTF).”  There is a regional JTTF in Salt Lake City.)

ST. GEORGE, UT – Frank Gene Powell, age 51, of Hurricane, Utah, the lead defendant in a significant federal elder fraud case targeting an 80-year-old widow in Washington, Utah, will serve 10 years in federal prison and pay $273,849.20 in restitution to the victim of the fraud scheme. U.S. District Judge David Nuffer imposed the sentence Thursday morning in St. George.

Powell pleaded guilty in March to conspiracy to commit wire fraud, money laundering, two counts of destruction of records in a federal investigation, concealment of a document or object in an attempt to impair the object’s integrity or availability for use in an official proceeding, and tampering with a witness.

Powell, who is in custody, will also forfeit two vehicles and be on supervised release for three years following his release from federal prison.

Powell was on state parole at the time of his federal crimes after serving nearly 30 years in state prison for murder.  While he was in prison, he received a 1-to-15 year sentence for sexually assaulting an inmate.

As a part of his plea agreement, Frank Powell admitted that from around March 2019 and continuing until about Feb. 6, 2020, he conspired with others to devise a fraud scheme with the specific intent to obtain money or property by means of fraudulent representations or promises.  He agreed with his codefendants to engage in a scheme to defraud the victim by soliciting money and assets in exchange for false promises to perform work for the victim. He also admitted he engaged in a fake romantic relationship with the victim as a part of his scheme to defraud her.

He admitted that he purchased a 2019 GMC Sierra using money he received as a part of his scheme to defraud the victim.  Using money derived from criminal conduct is money laundering.  Several of the counts he pleaded guilty to relate to efforts he took to impede and obstruct the investigation of the case, including concealing cellular phones and money.

Powell also pleaded guilty to witness tampering admitting that in November 2019, he attempted to stop the victim from communicating with law enforcement officers investigating the case. Through written correspondence and phone calls, Powell and his codefendant, Faye Renteria, age 42, of Hurricane, made misleading statements and attempted to get the victim to assist them in avoiding prosecution.

“Powell is a career criminal who has fended off decades of rehabilitative attempts in the Utah state criminal justice system.  He’s a convicted murderer and sexual predator, who has now turned his criminal efforts to elder fraud while on state parole,” U.S. Attorney for Utah John W. Huber said today. “With these guilty pleas, he stands convicted of unconscionable crimes against a senior member of the St. George community.  A 10-year sentence is very appropriate in this case and will help ensure that Utah will not fall victim to his crimes again.”           

"This crime is especially heinous because Frank Powell not only deceived and defrauded the victim, he made it a family affair," said Special Agent in Charge Paul Haertel of the Salt Lake City FBI.  "As a society, we should be looking out for the elderly, not exploiting them.  Crimes like this will be aggressively investigated, and we encourage the public to immediately report any fraud to law enforcement or the FBI."

Eight defendants were charged in a 10-count superseding indictment returned by a federal grand jury in January. The indictment alleged the defendants, who have family relationships, conspired to obtain money and assets from the victim in exchange for false promises to perform work on her property.

The indictment alleges that starting around March 2019 through October 2019, several of the defendants began soliciting payments from the victim by offering to perform routine repairs and odd jobs on her property. The victim created a list of requested repairs, such as painting the exterior of the house, resurfacing the driveway, doing yard work, hammering protruding nails on the roof, fixing a door handle on a car, removing grease spots on the driveway, and installing carpet on an outdoor deck.  To further advance the scheme, Frank Powell engaged in romance fraud by enticing the victim to enter into a romantic relationship. He used the romantic relationship to manipulate the victim into giving him money and assets.

According to the indictment, most of the jobs they promised to do were never completed or the quality of work was extremely poor and fell well below any expectation of professionally done work. The victim paid the defendants at least $273,849.20, both indirectly and directly, for this work.

The indictment included one count of wire fraud conspiracy, five counts of money laundering conspiracy – spending, two counts of destruction or concealment of records and tangible objects in a federal investigation, one count of concealment of a document or object, and one count of tampering with a witness or victim.

Frank Powell’s mother and codefendant, Gloria Jean Powell, age 74, of St. George, was sentenced to time served on May 1, 2020, after pleading guilty to one count of concealment of a document or object, admitting she concealed or attempted to conceal U.S. currency with the intent to impair an FBI investigation.  She admitted she aided and abetted her son, Frank Powell, and her daughter, Angela McDuffie, age 53, of Lehi, in the conduct.  She also agreed to forfeit a 2010 Toyota Venza as a part of the resolution of her case.

Sentencing is set for July 15, 2020, for Renteria, who pleaded guilty May 7, 2020, to conspiracy to commit wire fraud, wire fraud, two counts of money laundering, two counts of destruction of records or tangible objects designed to impede the FBI’s investigation in the case, and witness tampering.   Among other things, she admitted she engaged in misleading conduct involving the victim in the case in an attempt to prevent or delay her from communicating with law enforcement regarding the commission of a federal crime.

Renteria faces sentences of up to 20 years for conspiracy to commit wire fraud, up to 10 years for each count of money laundering, up to 20 years for each count of destruction of records or tangible objects in a federal investigation, and up to 10 years for the witness tampering conviction.  Renteria is in custody.

Bubby Mern Shepherd, age 58, of Lodi, California, and Rocky James Powell Mott, age 40, of Hurricane, also have entered guilty pleas.  Shepherd pleaded guilty last week to one count of conspiracy to commit wire fraud.  Mott pleaded guilty Wednesday to the same count.  Plea agreements for Shepherd and Mott, who are both in custody, include a stipulated sentence of 21 months in prison for the conviction.  The sentence is subject to the approval of the court.

Cases are pending against McDuffie, Terrence Quincy Powell, age 24, of St. George, and Martell Taz Powell, age 25, of Cedar City.  A Sept. 22, 2020, trial date is set in the case.

Combatting elder abuse and financial fraud targeted at seniors is a key priority of the U.S. Department of Justice and the U.S. Attorney’s Office in Utah. Elder abuse is a serious crime against some of our nation’s most vulnerable citizens, affecting at least 10 percent of older Americans every year.  Together with federal, state, local and tribal partners, the Department of Justice is committed to combatting all forms of elder abuse and financial exploitation through enforcement actions, training and resources, research, victim services, and public awareness.  This holistic and robust response demonstrates the Department’s unwavering dedication to fighting for justice for older Americans.

Assistant U.S. Attorneys in Utah are prosecuting the case.  The FBI is investigating the case. Agents with Utah Adult Probation and Parole have made signification contributions to the investigation.

SALT LAKE CITY – Federal prosecutors and their law enforcement partners, concerned about how domestic violence disproportionately impacts Utah’s homicide rate, are targeting offenders who attempt to buy guns illegally and are prohibited under federal law from possessing them.  In some years, more than half of Utah homicides have a connection to domestic violence.

Many of Utah’s domestic violence homicides involve firearms.  Studies show that the presence of a gun in a domestic violence situation increases the risk of homicide.  Prosecutors are also concerned about the impact of COVID-19 on domestic violence cases in Utah.  COVID-19 presents a perfect storm of conditions for victims of domestic violence that requires concern and immediate action.  What could be worse for a domestic violence victim than isolation with an abuser coupled with reduced access to shelter, resources, lawyers, advocates, and court proceedings?

In Utah, increased calls for police assistance with domestic violence incidents have been reported along the Wasatch Front during stay-at-home directives. In some areas around the country, police leaders are concerned that reported domestic violence crime is actually under reporting what is happening behind closed doors.

Last November, Attorney General William Barr launched Project Guardian with the goal of stopping violence before it starts. Federal prosecutors and law enforcement officers are using federal firearms laws as a “homicide prevention” tool in Utah. For example, under federal law those who are subject to a protective order or who have been convicted of a domestic violence misdemeanor are prohibited from possessing a gun. Tragedies happen when these restricted persons possess firearms, and in Utah, that tragedy too often involves a domestic violence homicide.

According to FBI statistics, 157,414 individuals with a misdemeanor crime of domestic violence conviction were denied firearms purchases between Nov. 30, 1998 and April 30, 2020. Another 65,032, subject to a protection or restraining order for domestic violence, were denied firearms purchases.  

“Project Guardian – launched by Attorney General Barr – will get Utah law enforcement to the next level in fighting gun violence.  Our intent is to spot the potential for violence, and address it before the violence occurs.  If we can prevent even one domestic violence homicide, we are on our way to making a significant impact in Utah,” U.S. Attorney John W. Huber said today.  “It’s the victims who motivate my partners and me to pursue these cases using federal law.”

U.S v Kelly

On April 13, 2020, several Emery County Sheriff’s Deputies responded to a possible domestic violence incident based on a report that Vincent Mac Kelly had destroyed part of the interior of a family member’s home and fired several rounds from a firearm into a trailer and in the front yard of his residence in Huntington, Utah.

According to federal charging documents, as the deputies approached the residence, Kelly ran into the trailer.  While officers were trying to speak to him, Kelly opened the door and threw a knife at them.  He later threw a revolver and a lemon at the officers. A live round of ammunition was in the revolver he threw at officers along with seven spent cartridge casings.

Kelly, according to the complaint, eventually came to the door and was taken into  custody.  Officers found five live.357 rounds of ammunition in his pocket. They also found drugs, large knives and speed loaders containing .357 ammunition in his trailer.  Speed loaders are used to quickly reload revolvers with all the ammunition at once rather than one cartridge at a time. 

The complaint charges Kelly, age 46, with possession of a firearm by a convicted felon and possession of a firearm and ammunition while subject to a protective order.  He faces up to 10 years in federal prison for each count if he is convicted of the charges.

U.S. v King 

James Albert King, age 71, of Magna, is charged with making a false statement during the acquisition of a firearm and possession of a firearm while subject to a protective order in a complaint filed Tuesday.

On Dec, 6, 2019, King went to Federal Firearms Licensee (FFL) store and selected a semi-automatic pistol (essentially an AR-15).  According to a complaint filed in the case, as King filled out an ATF form to buy the gun, he answered “no” to the question asking if he was subject to a court order restraining him from harassing, stalking, or threatening your child or an intimate partner or child of such partner.  Based on the information King provided, the FFL submitted the ATF form.  A background check indicated that King was prohibited and the purchase should have been denied.

However, an employee at the business missed the denial indicator, and King was allowed to purchase the weapon for $1,037.09. A short time later, the FFL realized the purchase should have been denied.  A manager made several calls to King to request he bring the firearm back to the store.  In a conversation Dec. 13, 2019, King told the manager that he could not return the firearm because it had been stolen from his vehicle in a Walmart parking lot.

Agents with the Utah Department of Public Safety’s State Bureau of Investigation and FBI special agents took King into custody Thursday night. During the execution of a search warrant, agents recovered the semi-automatic weapon he purchased in December along with two other handguns. He was booked into jail on the federal warrant and two Class A protective order violations. ($25,000 bail set Friday morning by state judge).

Each of the two counts in the complaint, false statement during the acquisition of a firearm, and possession of a firearm while subject to a protective order, carry potential 10-year sentences.

US v Lowery

Shane Curtis Lowery, age 55, of Hurricane, was charged with possession of a firearm and ammunition by a person subject to a domestic violence protective order in a complaint filed in November.  On Nov. 2, 2019, Hurricane Police Department officers responded to a report of a family fight. According to the complaint, witnesses told officers that Lowery had been seen leaving the property of his wife. Among other things, all four tires on her rental car had been punctured.

A district court judge in St. George issued a protective order for his wife in June 2019 that prohibits the defendant from being within 500 feet of his wife and her residence.  It also prohibits him from trying to commit or threatening to commit any form of violence and prohibits him from possessing firearms or ammunition.

Officers located Lowery later on Nov. 2, 2019, in LaVerkin and placed him under arrest for the protective order violation and domestic violence related charges. Individuals approached the officers and told them Lowery had threatened to harm to his wife.  They also told officers he had a firearm in his truck.

With a court-authorized search warrant, Lowery’s truck was searched and a Hi-Point 9mm handgun with a magazine containing eight bullets was located.  Two additional magazines for the handgun and an additional box of ammunition were also located in the truck.  The LaVerkin Police Department assisted with the case.

A federal grand jury returned an indictment charging Lowery in December 2019.

Lowery pleaded guilty to the charge and was sentenced to 13 months in federal prison and three years of supervised release on May 1, 2020.

US v Tatton

Sentencing is set for July 13, 2020, for David Lynn Tatton, age 50, of Nephi, who pleaded guilty in February to making a false statement during an attempted acquisition of a firearm.  Tatton admitted that on Nov. 29, 2019, he made a false statement in an attempt to purchase two shotguns. As a part of the purchase process, Tatton indicated on an ATF form that he was not subject to a court order restraining him from harassing, stalking, or threatening an intimate partner – a statement he knew was false.  The Utah State Bureau of Investigation is investigating the case.

US v Shaw

Daniel Wayne Shaw, age 37, of Tooele, is charged with making a false statement in an indictment returned Jan. 22, 2020. According to the indictment, in an attempt to buy a handgun,  Shaw made a false statement on an ATF form.  He falsely answered “no” to a question asking whether he had been convicted of a misdemeanor count of domestic violence in any court. The answer was untrue, the indictment alleges. A trial is set for June 16, 2020, in federal court in St. George.  The trial date may be changed based on the coronavirus outbreak.

SALT LAKE CITY – Two Utah more cities are receiving U.S. Department of Justice funding to support a broad range of activities as they respond to the coronavirus.  The funding is coming from DOJ’s Bureau of Justice Assistance through the Coronavirus Emergency Funding Program.

West Valley City will receive $333,508 and Midvale is getting $46,274. West Jordan and Murray received grants last week.

“The Department of Justice is providing communities with funding to use for critical public safety needs they have for police officers and medical personnel as they work on the front lines to keep us safe through this challenging crisis,” U.S. Attorney John W. Huber said today. “These aren’t one-size-fits all grants. Each city has flexibility to use these dollars to support the challenges they are facing in their communities.”

The Emergency Supplemental Funding Program allows states, local governments, and federally recognized tribal governments to apply for critical funds to use as they respond to the coronavirus.  Those receiving grants have considerable latitude in the use of the funds. The grant funding can support things like law enforcement overtime, equipment, hiring, supplies such as gloves, masks, and sanitizer for police officers and medical personnel, training, travel expenses, and addressing the needs of inmates in state, local, and tribal prisons, jails, and detention centers.

Funding for other Utah cities and counties is pending. Agencies that were eligible for the fiscal year 2019 State and Local Edward Byrne Memorial Justice Assistance Grant Program are candidates for this emergency supplemental funding.

SALT LAKE CITY – Timothy James Hallows, age 62, of Kaysville, pleaded not guilty to possession of child pornography during an initial appearance in U.S. District Court in Salt Lake City Friday.           

The charges, filed May 8, 2020, allege Hallows possessed material containing an image of child pornography involving a minor who had not attained 12 years of age. A change of plea hearing has been scheduled for June 30, 2020, at 3 p.m. before U.S. Magistrate Judge Dustin B. Pead.  Hallows is in federal custody.

Prosecutors in the U.S. Attorney’s Office and the Davis County Attorney’s Office have worked together to determine the best venue to prosecute the case.  Those discussions resulted in the filing of the Felony Information last week. This coordination happens regularly in child exploitation cases because of the significant penalties available in the federal system.  Law enforcement officers working these cases are often members of the FBI’s Child Exploitation Task Force, which allows them to work seamlessly with prosecutors in either venue.

“These are cases that motivate all prosecutors because they involve the victimization and exploitation of children,” U.S. Attorney John W. Huber said today. “My office regularly partners with the Office of the Davis County Attorney on child exploitation cases such as this one, as we do with other county attorney offices throughout the state. Together, we seek the best court system to achieve justice for child victims and their families.”

“State court prosecutors and law enforcement officers are experienced and accomplished in developing cases. Unfortunately, and all too often, inadequate state court sentences fail to deliver measured justice that matches the seriousness of the offenses. Federal court convictions can typically bring more appropriate sentences for those who would collect images of sexual violence against children.  In this case, state and federal law enforcement partners jointly determined that federal court offered a more appropriate venue for prosecution,” Huber said.

Federal judges consider a number of factors when imposing a sentence for possession of child pornography.  They include the number of images, use of a computer, distribution of the images, the defendant’s abuse of a position of trust to conceal the offense, the ages of the children in the images, the defendant’s criminal history, the nature and circumstances of the offense, and the characteristics of the defendant. Multiple counts do not change the sentence because the court is aware of each image possessed by the defendant regardless of how many counts are charged.

As a part of sentencing in a case, prosecutors will ask the judge to impose a term of supervised release for the defendant following the completion of their sentence. In child exploitation cases, it can be up to life with a minimum of five years. (There is no parole in federal court cases.)

A Felony Information is not a finding of guilt.  A defendant charged in a Felony Complaint is presumed innocent unless or until proven guilty in court.

SALT LAKE CITY – Two Utah cities are receiving U.S. Department of Justice funding to support a broad range of activities as they respond to the coronavirus.  The funding is coming from DOJ’s Bureau of Justice Assistance through the Coronavirus Emergency Funding Program.

Murray will receive $112,282 and West Jordan is getting $127,429.

“The Department of Justice provides communities with funding to use for critical public safety needs. Police officers and other front line responders will have access to this assistance as they keep residents and themselves safe through this challenging crisis,” U.S. Attorney John W. Huber said today. “These cities know best how to use the supplemental funds, and they are afforded considerable flexibility to use these dollars to protect and serve their neighborhoods.”

The Emergency Supplemental Funding Program allows states, local governments, and federally recognized tribal governments to apply for critical funds to use as they respond to the coronavirus.  Those receiving grants have considerable latitude in the use of the funds. The grant funding can support things like law enforcement overtime, equipment, hiring, supplies such as gloves, masks, and sanitizer for police officers and medical personnel, training, travel expenses, and addressing the needs of inmates in state, local, and tribal prisons, jails, and detention centers.

Funding for other Utah cities and counties is pending. Agencies that were eligible for the fiscal year 2019 State and Local Edward Byrne Memorial Justice Assistance Grant Program are candidates for this emergency supplemental funding.

SALT LAKE CITY – While many Utahns have spent the last two months staying home and staying safe as a result of COVID-19, online predators are threatening the safety of our children as they continue to exploit children in Utah and around the country.

Federal prosecutors and the FBI saw the potential risk coming in March.  “Due to school closings as a result of COVID-19, children will potentially have an increased online presence and/or be in a position that puts them at an inadvertent risk.  Due to this newly developing environment, the FBI is seeking to warn parents, educators, caregivers, and children about the dangers of online sexual exploitation and signs of child abuse,” an FBI national press release cautioned.

“During the pandemic, parents have taken on more and more during stay at home directives.  Work, school, and parenting blend into demanding days.  With everyone at home together, we may expect that the threat of child sexual exploitation would diminish.  Unfortunately, that does not appear to be the case,” U.S. Attorney John W. Huber said today.

As a parent himself, Huber understands parents are focused on many things. However, it is important for them to remain vigilant in protecting their children from sexual predators. “I can also assure parents, who are feeling the strain in many areas that my office and our law enforcement partners are working as aggressively as ever to target these criminals and keep them away from our children,” Huber said.

"Kids should be aware that the idea of "stranger danger" also applies when they go online because predators will misrepresent themselves to gain their trust," said Paul Haertel, Special Agent in Charge of the FBI in Salt Lake City. "When a child is sexually exploited, there can be life-long consequences, but the crime is preventable.  The FBI will do our part to go after those who hurt society's most vulnerable, and we urge parents and caregivers to do their part too through education and awareness."

Online sexual exploitation comes in many forms, according to the FBI national release.  Individuals may coerce victims into providing sexually explicit images or videos of themselves.  Other offenders may make casual contact with children online, gain their trust, and introduce sexual conversation that increases in egregiousness over time.  Ultimately, this activity may result in maintaining an online relationship and the exchange of illicit images, the release says.  Others may try to entice minors to meet them for sexual activity.  A list of recommendations for parents and guardians is included with this press release.

Examples of recent cases:

Michael L. Travers, age 53, a long-haul trucker from Diberville, Mississippi, was sentenced Tuesday to 17½ years in federal prison by U.S. District Judge Ted Stewart in Salt Lake City. Travers pleaded guilty to one count of production of child pornography in December.  As a part of the plea agreement, he admitted that between January and April of 2019, he produced sexually explicit images of Minor A, who was 8 years old at the time. Distribution of child pornography, coercion and enticement, and possession of child pornography counts were dismissed Tuesday as a part of the plea agreement.

The Travers case was investigated by the West Valley City Police Department.

Federal complaints filed on April 27, 2020, charge three individuals with possession of child pornography. The cases include:

Scott Andrew Clark, age 44, of Ogden faces possession of child pornography charges following an investigation by the Riverdale Police Department, the Weber County Sheriff’s Office, and a special agent with the U.S. Department of Homeland Security Investigations, who is assigned to the FBI’s Child Exploitation Task Force (CETF) and the Utah Internet Crimes Against Children Task Force (ICAC).

Clark came to the attention of law enforcement officers on April 7, 2020, when officers of the Riverdale Police Department responded to a call reporting a suspicious individual sitting in a parked vehicle next to a retail business. An employee of the business made the call after observing the same individual and vehicle the previous day.  Officers approached the car and identified Clark, who admitted he was a registered sex offender. He also admitted he was in possession of child pornography.  A forensic analysis conducted by the Weber County Sheriff’s Office revealed child pornography on two of the six devices located in Clark’s vehicle.  The complaint alleges that there were more than 5,000 images and 200 videos of child pornography recovered on the devices, including images of infants and other children.  Clark has a 2003 state court conviction in Utah for attempted sexual abuse of a minor.

Michael W. Fritchen, age 64, of North Salt Lake City, also charged with possession of child pornography, came to attention of law enforcement through a tip from the National Center for Missing and Exploited Children (NCMEC). The CyberTip reported an image depicting the sexual exploitation of a child approximately 4-6 years old.

An investigation by a Layton City police officer, working as a task force officer with the FBI’s task force, led law enforcement officers to Fritchen, whose criminal history includes a 1993 conviction on several counts of committing an indecent liberties on children. The case was conducted before a United States Air Force general court martial.  He received a 10-year sentence.

A forensic review of a desktop seized from Fritchen’s home in North Salt Lake City uncovered more than 13,000 possible images depicting the sexual exploitation of children.

Miguel Angel Jimenez, age 24, of  Magna, is charged with possession of child pornography following an investigation by a Layton City police officer working as a task force officer with the FBI’s task force.  On Feb. 2, 2020, the Layton officer was conducting an undercover operation portraying himself as a 13-year-old girl when a chat began with an individual later identified as Jimenez.  According to the complaint, Jimenez engaged in sexual conversation with someone he believed to be a 13-year-old child and arranged to meet the child for sex on multiple occasions; however, he never appeared at the meeting location.

The investigation continued leading law enforcement to an address in Magna where they found the defendant, a registered sex offender, who was on probation for enticing a minor and possessing child pornography in Salt Lake County. Jimenez was taken into custody when he appeared for a meeting with a probation officer.  Numerous files of child pornography were found on his phone, including 773 images of child pornography and 507 videos, according to the complaint.

Clark, Fritchen, and Jimenez each face up to 20 years in prison, with a 10-year minimum mandatory sentence, if convicted of the charges in the complaint.  They are currently in state custody.

Complaints are not findings of guilt.  Individuals charged in complaints are presumed innocent until proven guilty in court.

Recommendations from the FBI’s National Press Office release issued March 23, 2020:

Parents and guardians can take the following measures to help educate and prevent children from becoming victims of child predators and sexual exploitation during this time of national emergency:

Online Child Exploitation

• Discuss Internet safety with children of all ages when they engage in online activity.
• Review and approve games and apps before they are downloaded.
• Make sure privacy settings are set to the strictest level possible for online gaming systems and electronic devices.
• Monitor your children’s use of the Internet; keep electronic devices in an open, common room of the house.
• Check your children’s profiles and what they post online.
• Explain to your children that images posted online will be permanently on the Internet.
• Make sure children know that anyone who asks a child to engage in sexually explicit activity online should be reported to a parent, guardian, or other trusted adult and law enforcement.
• Remember that victims should not be afraid to tell law enforcement if they are being sexually exploited. It is not a crime for a child to send sexually explicit images to someone if they are compelled or coerced to do so.

Child Abuse Awareness

• Teach your children about body safety and boundaries.
• Encourage your children to have open communication with you.
• Be mindful of who is watching your child for childcare/babysitting, playdates and overnight visits.
• If your child discloses abuse, immediately contact local law enforcement for assistance.
• Children experiencing hands-on abuse may exhibit withdrawn behavior, angry outbursts, anxiety, depression, not wanting to be left alone with a specific individual, non-age appropriate sexual knowledge, and an increase in nightmares.

Victim Reporting

Reporting suspected sexual exploitation can help minimize or stop further victimization, as well as lead to the identification and rescue of other possible victims. If you believe you are—or someone you know is—the victim of child sexual exploitation:

• Contact your local law enforcement agency.
• Contact your local FBI field office or submit a tip online at tips.fbi.gov.
• File a report with the National Center for Missing & Exploited Children (NCMEC) at 1-800-843-5678 or online at www.cybertipline.org.

When reporting, be as descriptive as possible in the complaint form by providing as much of the following as possible:

• Name and/or user name of the subject.
• Email addresses and phone numbers used by the subject.
• Websites used by the subject.
• Description of all interaction with the subject.
• Try to keep all original documentation, emails, text messages, and logs of communication with the subject. Do not delete anything before law enforcement is able to review it.
• Tell law enforcement everything about the online encounters—we understand it may be embarrassing for the parent or child, but providing all relevant information is necessary to find the offender, stop the abuse, and bring him/her to justice.

More information about the FBI’s guidance on child sexual exploitation and protecting your kids

SALT LAKE CITY – Omnicare, Inc., a subsidiary of CVS Health and a provider of pharmacy services to long-term care facilities, has agreed to pay the United States a $15.3 million civil penalty to resolve allegations that it violated federal law by, among other things, allowing opioids and other controlled substances to be dispensed without a valid prescription, United States Attorney John W. Huber announced today.

The Cincinnati-based Omnicare operates “closed door” pharmacies – meaning they are not open to the public – that deliver controlled substances to nursing homes and other long-term care facilities (LTCFs). Omnicare makes daily deliveries of prescription medications to residents of LTCFs, and it also pre-positions limited stockpiles of controlled substances at LTCFs in “emergency kits,” which are to be dispensed to patients on an emergency basis. These emergency kits, which often include opioids and other controlled substances that are commonly abused and diverted, remain part of Omnicare’s inventory and must be tightly controlled and tracked. The controlled substances may be dispensed only pursuant to a valid prescription.

The United States alleged that Omnicare violated the federal Controlled Substances Act in its handling of emergency prescriptions, its controls over the emergency kits, and its processing of written prescriptions that lacked required elements such as the prescriber’s signature or DEA number. The federal investigation found that Omnicare failed to control emergency kits by improperly permitting LTCFs to remove opioids and other controlled substances from emergency kits days before doctors provided a valid prescription. The investigation also revealed that Omnicare had repeated failures in its documentation and reporting of oral emergency prescriptions of Schedule II controlled substances.

The Omnicare pharmacies in Utah are Omnicare of Salt Lake City and Omnicare of St. George.

As part of the settlement agreement announced today, Omnicare agreed to pay the $15.3 million civil penalty and entered into a Memorandum of Agreement with the Drug Enforcement Administration that will require Omnicare to increase its auditing and monitoring of emergency kits placed at LTCFs.

“In Utah, we understand the dangers involved with opioids.  We understand how carefully they must be managed and accounted for. Omnicare failed on several fronts, including dispensing opioids without a valid prescription and failing to report losses of opioids and other drugs,” U.S. Attorney John W. Huber said today. “Controls are in place to make sure that companies dispensing these drugs are doing it correctly and safely. When these controls are not followed, penalties like we see in this case will be imposed.”

 “Omnicare failed in its responsibility to ensure proper controls of medications used to treat some of the most vulnerable among us,” said DEA Acting Administrator Uttam Dhillon.  “DEA is committed to keeping our communities safe by holding companies like Omnicare accountable for such failures, while ensuring continuity of care and necessary access to emergency prescription drug supplies.”

This matter was investigated by the DEA’s Field Divisions in Denver, Los Angeles, San Francisco and Seattle, in conjunction with five United States Attorney’s Offices: the District of Utah, the Central District of California, the Eastern District of California, the District of Colorado, and the District of Oregon. The settlement agreement, which was finalized on May 6, resolves Omnicare’s civil liability for the alleged CSA violations in those five districts.

The claims settled by this civil agreement are allegations.  In entering into this settlement, Omnicare did not admit to any liability.

Assistant United States Attorneys Carra Cadman and Sandra Steinvoort of the Affirmative Civil Enforcement section in the U.S. Attorney’s Office in Salt Lake City represented Utah in the matter.

SALT LAKE CITY – U.S. Attorney John W. Huber is recognizing the service and sacrifice of federal, state, local, and tribal law enforcement as National Law Enforcement Week begins. The week will be observed Sunday, May 10 through Saturday, May 16, 2020.

“As we begin another week amidst the upheaval of the pandemic, may we pause to remember our law enforcement heroes,” Huber said today. “These men and women continue to risk their own personal safety on our behalf. They are selfless, brave and dedicated to preserving peace and ensuring justice.”

“There is no more noble profession than serving as a police officer,” said Attorney General William P. Barr. “The men and women who protect our communities each day have not just devoted their lives to public service, they’ve taken an oath to give their lives in order to ensure our safety. And they do so not only in the face of hostility from those who reject our nation’s commitment to the rule of law, but also in the face of evolving adversity – such as an unprecedented global health pandemic. This week, I ask all Americans to join me in saying ‘thank you’ to our nation’s federal, state, local, and tribal law enforcement officers. Their devotion and sacrifice to our peace and security will not be taken for granted.”

“Utah police officers make our communities better places to live in ways both large and small.  We observe daily examples of their commitment to the communities they serve, from metro Salt Lake City to the Navajo Nation in southern Utah. Police officers do extraordinary things, often making split-second decisions. They deserve our appreciation and thanks,” Huber said.  “We also remember those officers who have given their lives in the line of duty in Utah.  This week gives us a chance to pay tribute to the service of those who serve us.”

In 1962, President Kennedy issued the first proclamation for Peace Officers Memorial Day and National Police Week to remember and honor law enforcement officers for their service and sacrifices.  Peace Officers Memorial Day, which every year falls on May 15, specifically honors law enforcement officers killed or disabled in the line of duty.

Each year, during National Police Week, our nation celebrates the contributions of law enforcement from around the country, recognizing their hard work, dedication, loyalty and commitment to keeping our communities safe. This year the COVID-19 pandemic has underscored law enforcement officers’ courage and unwavering devotion to the communities they swore to serve.

The names of the fallen officers who have been added in 2020 to the wall at the National Law Enforcement Memorial will be read on Wednesday, May 13, 2020, during a Virtual Annual Candlelight Vigil. Because public events have been suspended as a result of COVID-19, the vigil will be livestreamed to the public at 8:00 pm (EDT). To register to view this free online event, please www.LawMemorial.org/webcast.

To learn more about National Police Week and the virtual candlelight vigil, please visit www.policeweek.org.

SALT LAKE CITY – A federal complaint filed Wednesday charges Hector Fernando De La Rosa, age 22, of Salt Lake City with brandishing a firearm during three convenience store robberies in Murray, Salt Lake City, South Salt Lake City in late January.

The complaint alleges De La Rosa brandished a firearm during a Jan. 21, 2020, robbery of a Maverik convenience store at 4800 South 530 West in Murray, a Jan. 22 robbery of a 7-Eleven at 1157 West California Avenue in Salt Lake City, and a Jan. 28, 2020, robbery of a 7-Eleven at 2700 South 420 East in South Salt Lake City.

De La Rosa is charged with three counts of robbery and three counts of brandishing a firearm during each of the robberies.  He is also charged with possession of a firearm and ammunition following a felony conviction.

According to the complaint, two individuals went into the Maverik in Murray and the 7- Eleven in Salt Lake City.  One of the suspects, wearing a gray Puma hoodie, has been identified as De La Rosa.  The second individual has not been identified. Cigarettes were taken from the Maverik and a firearm was brandished to get the cashier to open cash registers.  The complaint alleges the suspects told the cashier he would be shot if he did not open the cash register. The defendants stole $246 from the store.

De La Rosa and the second suspect used similar tactics in the robbery the next day at 7- Eleven in Salt Lake City, the complaint alleges.  As they approached the register, the cashier saw one suspect pull out a handgun and pull the slide back. The second suspect, De La Rosa, also pointed a handgun at the cashier.  The cashier ran to a backroom and called the police. One suspect immediately fled the store.  The suspect wearing the gray hoodie, De La Rosa, tried to grab the cash register before fleeing as well.

De La Rosa is charged with the Jan. 28 robbery at the 7-11 in South Salt Lake City.  Cigarettes and cash were stolen from the store along with the cashier’s cell phone.

Using store surveillance video, law enforcement officers were able to identify a white 1992 Toyota Camry and determined it had been stolen in West Valley City. A day later, West Valley City police officers were involved in a vehicle pursuit involving a different stolen car, the complaint alleges.  The driver crashed into several parked cars.  Officers ultimately spiked the tires, but the driver kept driving. He later left the car and fled from police officers.  He was ultimately tackled and arrested.

The suspect was identified as Hector De La Rosa.  He was wearing the same clothing worn in the South Salt Lake City robbery.  A black revolver was also located in the stolen vehicle De La Rosa had been driving just prior to his arrest.

The potential maximum penalty for each of the three robberies is 20 years in federal prison.  The potential penalty for possession of a firearm following a felony conviction is 10 years in prison.  Each count of brandishing a firearm during a crime of violence has a potential life sentence with a seven-year minimum mandatory sentence. Penalties imposed for each brandishing count run consecutive to any sentence imposed for the robberies.

De La Rosa is currently in state custody.  An initial appearance will be set for him.

Complaints are not findings of guilt.  Individuals charged in a complaint are presumed innocent unless or until proven guilty in court.

FBI special agents and Salt Lake City police officers are investigating the case with assistance with the West Valley City Police Department. The U.S. Attorney’s Office is prosecuting the case.

SALT LAKE CITY – A federal court in Utah has entered an injunction halting the sale of a fraudulent coronavirus (COVID-19) treatment, the Department of Justice announced today.

In response to a civil complaint and accompanying court papers filed on April 27, 2020, in Salt Lake City, the U.S. District Court for the District of Utah issued a temporary restraining order against defendants Gordon Pedersen of Cedar Hills, Utah, and his companies, My Doctor Suggests LLC and GP Silver LLC.  The civil complaint alleges that the defendants are fraudulently promoting and selling various silver products for the treatment and prevention of COVID-19.  The court’s order temporarily enjoins the defendants from continuing to sell or distribute their silver products for the diagnosis, cure, mitigation, treatment, or prevention of any disease, including COVID-19. 

A separate court order temporarily freezes defendants’ assets in order to preserve the court’s ability to grant effective final relief and to maintain the status quo.  A hearing on the government’s request for a preliminary injunction is set for May 12, 2020.

“The Department of Justice will take swift action to protect consumers from those who would recklessly exploit this public health crisis by offering phony cure-alls for the treatment and prevention of COVID-19,” said Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division.  “We work closely with our partners at the Food and Drug Administration and will move quickly to shut down schemes that promote and sell unlawful products during this pandemic.”

“Even in a time of great uncertainty, there are at least two unchanging realities.  There are those who would unlawfully exploit our vulnerabilities, and there are those who will hold such parties accountable,” said U.S. Attorney John W. Huber for the District of Utah.  “COVID-19 is a dangerous disease, and American consumers must have accurate and reliable information as they make important health decisions.”

The complaint alleges that, beginning in early 2020, the defendants conducted a scheme to defraud consumers throughout the United States, promoting and selling silver products based on fraudulent claims of protection against, and treatment for, COVID-19.  According to the complaint, the defendants have made a wide variety of false and misleading claims touting silver products as a preventative for COVID-19, including that having silver in the bloodstream will “usher” any coronavirus out of the body and that “it has been proven that Alkaline Structured Silver will destroy all forms of viruses, it will protect people from the Coronavirus.” 

“The FDA will continue to help ensure those who place profits above the public health during the COVID-19 pandemic are stopped,” said Judy McMeekin, Pharm.D., Associate Commissioner for Regulatory Affairs, U.S. Food and Drug Administration.  “We are fully committed to working with the Department of Justice to take appropriate action against those jeopardizing the health of Americans by offering and distributing products with unproven claims to prevent or treat COVID-19.”

The enforcement action is being prosecuted by Assistant U.S. Attorney Joel A. Ferre of the U.S. Attorney’s Office for the District of Utah and Trial Attorneys Speare I. Hodges and Sarah Williams of the Department of Justice, Civil Division’s Consumer Protection Branch.  The FDA’s Office of Criminal Investigations and Office of the Chief Counsel is also assisting with the case.

The claims made in the complaint are allegations that, if the case were to proceed to trial, the government must prove to receive a permanent injunction against the defendants.

Additional information about the Consumer Protection Branch and its enforcement efforts may be found at www.justice.gov/civil/consumer-protection-branch.  For more information about the U.S. Attorney’s Office for the District of Utah, visit its website at https://www.justice.gov/usao-ut.  For information about the Department of Justice’s efforts to stop illegal COVID-19-related activity, visit www.justice.gov/coronavirus.  For the most up-to-date information on COVID-19, consumers may visit the Centers for Disease Control and Prevention (CDC) and WHO websites.

The public is urged to report suspected fraud schemes related to COVID-19 (the Coronavirus) by calling the National Center for Disaster Fraud (NCDF) hotline (1-866-720-5721) or by e-mailing the NCDF at disaster@leo.gov.

A federal court in Utah has entered an injunction halting the sale of a fraudulent coronavirus (COVID-19) treatment, the Department of Justice announced today.

In response to a civil complaint and accompanying court papers filed on April 27, 2020, in Salt Lake City, the U.S. District Court for the District of Utah issued a temporary restraining order against defendants Gordon Pedersen of Cedar Hills, Utah, and his companies, My Doctor Suggests LLC and GP Silver LLC.  The civil complaint alleges that the defendants are fraudulently promoting and selling various silver products for the treatment and prevention of COVID-19.  The court’s order temporarily enjoins the defendants from continuing to sell or distribute their silver products for the diagnosis, cure, mitigation, treatment, or prevention of any disease, including COVID-19.  A separate court order temporarily freezes defendants’ assets in order to preserve the court’s ability to grant effective final relief and to maintain the status quo.  A hearing on the government’s request for a preliminary injunction is set for May 12, 2020.

“The Department of Justice will take swift action to protect consumers from those who would recklessly exploit this public health crisis by offering phony cure-alls for the treatment and prevention of COVID-19,” said Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division.  “We work closely with our partners at the Food and Drug Administration and will move quickly to shut down schemes that promote and sell unlawful products during this pandemic.”

“Even in a time of great uncertainty, there are at least two unchanging realities.  There are those who would unlawfully exploit our vulnerabilities, and there are those who will hold such parties accountable,” said U.S. Attorney John W. Huber for the District of Utah.  “COVID-19 is a dangerous disease, and American consumers must have accurate and reliable information as they make important health decisions.”

The complaint alleges that, beginning in early 2020, the defendants conducted a scheme to defraud consumers throughout the United States, promoting and selling silver products based on fraudulent claims of protection against, and treatment for, COVID-19.  According to the complaint, the defendants have made a wide variety of false and misleading claims touting silver products as a preventative for COVID-19, including that having silver in the bloodstream will “usher” any coronavirus out of the body and that “it has been proven that Alkaline Structured Silver will destroy all forms of viruses, it will protect people from the Coronavirus.”  Additionally, the defendants assert that once in the blood stream, silver nanoparticles can block the virus from attaching to their cells, and thus “prevent[] the disease totally and completely.”

“The FDA will continue to help ensure those who place profits above the public health during the COVID-19 pandemic are stopped,” said Judy McMeekin, Pharm.D., Associate Commissioner for Regulatory Affairs, U.S. Food and Drug Administration.  “We are fully committed to working with the Department of Justice to take appropriate action against those jeopardizing the health of Americans by offering and distributing products with unproven claims to prevent or treat COVID-19.”

The enforcement action filed today is being prosecuted by Trial Attorneys Speare I. Hodges and Sarah Williams of the Department of Justice, Civil Division’s Consumer Protection Branch and Assistant U.S. Attorney Joel A. Ferre of the U.S. Attorney’s Office for the District of Utah, with support from FDA’s Office of Criminal Investigations and Office of the Chief Counsel.

The claims made in the complaint are allegations that, if the case were to proceed to trial, the government must prove to receive a permanent injunction against the defendants.

Additional information about the Consumer Protection Branch and its enforcement efforts may be found at www.justice.gov/civil/consumer-protection-branch.  For more information about the U.S. Attorney’s Office for the District of Utah, visit its website at https://www.justice.gov/usao-ut.  For information about the Department of Justice’s efforts to stop illegal COVID-19-related activity, visit www.justice.gov/coronavirus.  For the most up-to-date information on COVID-19, consumers may visit the Centers for Disease Control and Prevention (CDC) and WHO websites. 

The public is urged to report suspected fraud schemes related to COVID-19 (the Coronavirus) by calling the National Center for Disaster Fraud (NCDF) hotline (1-866-720-5721) or by e-mailing the NCDF at disaster@leo.gov.

SALT LAKE CITY – Three Georgia residents, accused of running an interstate criminal fraud scheme and preying on vulnerable individuals to facilitate their crimes, are charged in a 28-count federal complaint unsealed Friday.

Malik Wright, age 22, Tony Hutchinson, age 22, and Joseph D. Jackson, age 22, all of Atlanta, are charged with one count of conspiracy to commit bank fraud, 15 counts of possession of counterfeit securities, and 12 counts of aggravated identity theft in the complaint.

“These serious allegations outline a troubling scenario – out-of-state suspects recruited vulnerable adults into their plan that targeted Utah financial institutions for fraud,” U.S. Attorney John W. Huber said today. “Rest assured, during Utah’s stay at home directive, my office and our partners continue our work to keep Utah safe.”

The complaint alleges the defendants traveled from Atlanta to various states, including Utah, in rental cars.  They obtained bank account numbers and bank routing information for checking accounts for several businesses, including stealing checks from the mail. Jackson and other conspirators used the stolen information to make counterfeit checks that were drawn against the victim businesses’ accounts.

Jackson directed Wright and Hutchinson to the location of homeless shelters. Wright and Hutchinson then targeted homeless individuals, who had government-issued identification cards, to act as check cashers of the counterfeit checks, the complaint alleges. 

Once Wright and Hutchinson identified viable check cashers, conspirators, including Jackson, made counterfeit checks payable to the check cashers.  Wright and Hutchinson took the check cashers to a Walmart and purchased clothing for them to change into so they would not appear to be homeless individuals, according to the complaint.  After getting new clothes, the check cashers were driven to locations where the counterfeit checks were negotiated.

According to the complaint, on Dec. 10, 2019, the defendants attempted to cash seven checks totaling $13,860.95 at various Zions Bank branches drawn on the account of a Utah business.  As a result of these efforts, the bank lost $11,882.73.  A day later, the defendants attempted to cash seven checks totaling $11,882.51 at various Zions Bank branches.  Six of the checks were cashed, causing a $9,893.10 to Zions Bank.

Law enforcement officers stopped Wright and Hutchinson on Dec. 11, 2019, after employees at a Layton branch of Zions Bank alerted police that an individual was in the bank attempting to cash a fraudulent check.  The suspect fled the bank and got into a Silver GMC Yukon.  Officers were able to find the vehicle and conduct a traffic stop. Wright and Hutchinson were in the front seats of the vehicle.

The individual who went into the bank was interviewed and told officers that earlier in the day, Wright and Hutchinson approached him near the homeless shelter, flashed a large amount of cash, and asked him if he wanted to make some money.  Wright and Hutchinson drove the individual to Layton and told him he would be given checks with his name on them.  He said he would go into banks, cash the checks, and give the money to Hutchinson.  He would then receive a small portion of the money back.

At the time of the traffic stop, Wright and Hutchinson were in possession of 15 counterfeit checks purporting to be drawn on numerous actual business accounts. According to the complaint, two other homeless men passed fraudulent checks in Utah on behalf of Wright, Hutchinson, and Jackson on Dec. 10, 2019 and Dec. 11, 2019.

The complaint alleges Wright, Hutchinson, and Jackson are part of a group that travels around the country running bank fraud schemes that prey on homeless and vulnerable individuals to cash checks for them. According to the complaint, they traveled in Colorado, Ohio, Pennsylvania, Kentucky, and other states to achieve the goals of the conspiracy. 

Wright and Hutchinson are in custody in Utah.  Jackson was arrested recently in Georgia and has an appearance in federal court in Atlanta Monday.  Wright and Hutchinson have detention hearings Tuesday afternoon.

The potential maximum penalty for the conspiracy to commit bank fraud is 30 years in prison.  Each of the possession of counterfeit securities counts has a potential maximum penalty of 10 years.  Aggravated identity theft counts have mandatory minimum two-year penalties that run consecutive to the sentence for any other counts. 

Postal inspectors from the U.S. Postal Inspection Service and officers with the Layton Police Department are investigating the case.    

Complaints are not findings of guilt.  Individuals charged in complaints are presumed innocent until proven guilty in court.

SALT LAKE CITY – Utah U.S. Attorney John W. Huber shared highlights of the Department of Justice’s China Initiative with law enforcement agents and officers, private sector business representatives, university officials, and others at a Salt Lake City Security Webinar Wednesday morning. The U.S. Department of Homeland Security and the FBI sponsored the webinar.

Huber’s remarks focused on the economic and national security threats China poses to the United States and the importance of defending the country against these efforts.

Huber referenced testimony given by Assistant Attorney General John C. Demers before the Senate Judiciary Committee on Dec. 12, 2018.  “In many of the cases we see, China’s strategy is the same: Rob, Replicate, and Replace.  Rob the American company of its intellectual property, Replicate the technology, and Replace the American company in the Chinese market and, one day, in the global market,” Demers said in his testimony.

“About 80 percent of all federal economic espionage prosecutions have conduct that would benefit China and around 60 percent of federal trade secret theft cases have some nexus to China,” Huber said.

Utah has experienced its own China-related espionage case, Huber told those participating in the webinar.  Ron Rockwell Hansen, a Syracuse, Utah, resident and former Defense Intelligence Agency officer, was sentenced to 10 years in federal prison in September 2019 after admitting to spying and selling classified information to China.  

Huber concluded with key takeaways for those involved in the webinar, including identifying trade secrets and valuable intellectual property; instituting protections such as non-disclosure agreements, access controls, and need-to-know rules; employee training; and developing an internal employee reporting mechanism for suspicious activities.

“Utah companies should take affirmative steps to protect their hard-earned intellectual property and trade secrets,” Huber said. “The Department of Justice will respond to the economic aggression and other national security threats from the Chinese government.  United States Attorneys will hold accountable, and expose the tactics of those who would steal American innovation.”

ST. GEORGE, UT – A Las Vegas man, who posed as an FBI agent and then robbed Seven Oaks Fine Jewelers in St. George at gunpoint in September, is in federal custody following an investigation by the FBI and the St. George Police Department. 

Kevin White, age 57, of Las Vegas, was arrested Monday afternoon in Las Vegas on a federal complaint and arrest warrant charging him with one count of Hobbs Act robbery. The FBI Criminal Apprehension Team, comprised of officers and agents from the FBI, Las Vegas Metro Police Department, the Henderson Police Department, and the North Las Vegas Police Department. FBI agents from St. George and the St. George Police Department also assisted.

The federal complaint was unsealed Tuesday morning during an initial appearance for White in St. George.  White will remain in custody. A detention hearing may be held later.  

White, who has used at least 17 aliases, is currently on federal supervised release after serving 165 months in prison for an armed robbery of a Las Vegas jewelry store. According to a sentencing memo filed in the Nevada case, White is an eight-time felon who has committed multiple robberies.           

According to the complaint, two employees were working at the family-owned jewelry store in St. George on Sept. 28, 2019, when a black male entered the store about 1:05 p.m.  He was wearing a straw cowboy hat, a black jacket with “FBI” on the back, and a metal FBI badge on a lanyard around his neck.  He was carrying a black portfolio, handcuffs, and a handheld radio.  He also had a handgun in a holster on his right hip. 

The man represented to the store employees that he was an FBI agent, the complaint alleges.  He retrieved multiple FBI wanted posters from the portfolio and showed them to the victim employees. He told the employees that the fugitives had been in the St. George area and asked the employees if they recognized any of the fugitives.  He also asked whether anyone else was working in the store. The employees told him they did not recognize the fugitives and they were the only ones working in the store at that time.

The complaint alleges the man placed the posters back in the folder and began to leave the store. He then turned toward a display case and began asking questions about several jewelry items.  He told the employees he “came in looking for a suspect, might be leaving with an engagement ring.” The two employees, one standing behind the counter and one a few feet from the man, displayed several jewelry items for the man.

According to the complaint, at one point the man directed the employee standing near him to get behind the display counter with the other employee and pulled out a black handgun.  The complaint alleges the man, referring to a silent alarm, told the employees, “If you hit the button, I’ll kill you.”  The man grabbed the jewelry items from the display counter and put them into a bag.  He also told the employees he would kill them if the exit doors were locked.  The victim employees feared for their lives.

He left the store with 27 pieces of jewelry valued at $39,214, the complaint alleges.  In his haste, he left behind a brown fabric bag and his black portfolio.

Investigators submitted the bag and portfolio with its contents to the FBI Laboratory for forensic analysis. Agents were notified April 13, 2020, that a male DNA profile had been obtained from the portfolio in the textured material near the exterior stitching. The DNA profile matched White. Physical descriptions of the suspect provided by the victim employees and surveillance images from the business, matched White’s appearance.

The potential maximum penalty for a Hobbs Act robbery is 20 years in prison. 

Complaints are not findings of guilt.  Individuals charged in a complaint are presumed innocent unless or until proven guilty in court.

SALT LAKE CITY – The U.S. Attorney’s Office in Utah is joining the Department of Justice and communities nationwide in observing National Crime Victims’ Rights Week, celebrating victims’ rights, protections and services throughout the week.  This theme of this year’s observance, which takes place April 19-25, is “Seek Justice, Ensure Victims' Rights, Inspire Hope.”

“Every year, millions of Americans suffer the shock and trauma of criminal victimization, affecting their well-being and sense of security and dignity,” said Attorney General William P. Barr.  “To these victims, we affirm our unwavering commitment to supporting them in their hour of need.  We also commend the thousands of victim advocates and public safety professionals who labor tirelessly to secure victims’ rights and support survivors.”

“We remember victims of crime every day we come to work, but during this special week, we recognize them and recommit ourselves to serving their needs,” U.S. Attorney John W. Huber said.  “While we cannot take back the crime that has traumatized victims, we will always seek justice for them and ensure we hold offenders accountable.  We also recognize the many victim advocates and support agencies in Utah who work to support victims of crime.” 

“While we have made tremendous progress driving down crime and violence across the country, far too many Americans continue to suffer the pain and loss of criminal victimization,” said Katharine T. Sullivan, Principal Deputy Assistant Attorney General of the Office of Justice Programs.  “This week, we stand by these survivors and their families, and we pledge our ongoing support to the countless men and women who serve them with such extraordinary skill and compassion.”

Ronald Reagan proclaimed the first Victims’ Rights Week in 1981, putting crime victims' rights, needs, and concerns in a prominent spot on the American agenda.  He also established the President's Task Force on Victims of Crime, which laid the groundwork for a national network of services and legal safeguards for crime victims.  President Trump and his administration have implemented historic levels of support for victim assistance and victim compensation.

Some 3.3 million Americans age 12 and older were victims of violent crime in 2018, according to the National Crime Victimization Survey.  The Office for Victims of Crime (OVC), part of the Justice Department’s Office of Justice Programs, supports more than 7,000 local victim assistance programs and victim compensation programs in every state and U.S. territory.  Funds for these programs come from the Crime Victims Fund, which is made up of federal criminal fines, penalties and bond forfeitures.

During National Crime Victims’ Rights Week, victim advocacy organizations, community groups and state, local and tribal agencies traditionally host rallies, candlelight vigils, and other events to raise awareness of victims’ rights and services.  This year, many communities are organizing virtual gatherings and online public awareness campaigns.

This year’s commemoration began yesterday, 25 years to the day when a truck bomb exploded in front of the Alfred P. Murrah Federal Building in Oklahoma City, Oklahoma, taking the lives of 168 people, including 19 children, as well as injuring hundreds of others.  The mass murder remains the worst act of domestic terrorism in our nation’s history and led to the establishment of the Antiterrorism Emergency Reserve, which is administered by OVC, and has been used to provide direct services to hundreds of victims of mass violence and terrorism.

“Crime victims deserve to know that they have the encouragement and support of the American people,” said OVC Director Jessica E. Hart.  “I hope that citizens throughout the nation will take the opportunity this week to remember all victims of crime and their heroic stories of survival.  I encourage everyone to also find meaningful ways to express their appreciation to the many committed and compassionate service providers across the country who work tirelessly supporting these survivors.”

This year, the annual National Crime Victims’ Service Awards Ceremony will be postponed until a time when award recipients can be honored in person.  During the ceremony, OVC will present awards recognizing individuals and organizations from across the nation for their outstanding service on behalf of crime victims.  The awardees will be selected from public nominations in 11 categories, including federal service, special courage, public policy, and victim services.  Visit www.ovc.gov/gallery to learn more about past recipients.

The U.S. Attorney’s Office in Utah also holds an awards ceremony to recognize individuals for their work providing service for victims. It will be scheduled later. 

For more information on how to create your own public campaigns to raise awareness about crime victims’ rights online and at events throughout the year, please visit: https://ovc.ncjrs.gov/ncvrw2020/overview.html.

SALT LAKE CITY – A Salt Lake County man, who managed and operated Eco Apothecary and Eco Pharmacy in South Jordan from early 2016 to Feb. 26, 2020, is facing federal criminal and civil cases related to an alleged scheme to defraud health care benefit programs.

James Vaughn Ammon aka James Vaughn Soto, age 56, is charged with four counts of health care fraud and one count of aggravated identity theft in the criminal case.  A grand jury returned a five-count indictment in late February.  According to the indictment, Eco Apothecary and Eco Pharmacy’s primary business was providing prescriptions to patients.  The indictment alleges that Ammon devised a scheme to defraud Medicare and Medicaid.

According to the indictment, the businesses were enrolled as pharmaceutical providers with Medicaid and Medicare. To receive reimbursement for a covered service, the businesses were required to submit a claim with the required information identifying the patient and services rendered.

The indictment alleges Ammon unlawfully enriched himself by, among other things, submitting and causing the submission of false claims to Medicare and Medicaid. In furtherance of the scheme, the indictment alleges Ammon filed claims for drugs that were not dispensed to patients, filed claims for larger quantities of drugs than were actually dispensed, filed claims for dispensing drugs even though he did not have a valid prescription from a physician, and fabricated and forged State of Utah pharmacy licensing documents.

Each count of health care fraud carries a potential maximum penalty of 10 years in prison and a fine of $250,000.  The potential penalty for aggravated identity theft is a two-year mandatory minimum sentence.  The court has issued a summons to Ammon to appear on the charges.

Indictments are not findings of guilt.  Individuals charged in an indictment are presumed innocent unless or until proven guilty in court.

A parallel civil action filed by the U.S. Attorney’s Office alleges Eco Pharmacy, Eco Apothecary and Ammon violated the Controlled Substances Act and the False Claims Act by filling and billing Medicare for prescriptions after Eco Apothecary lost its state-issued license; billing for medications, including controlled substances, for which there was not a proper prescription or authorization; billing for medications not dispensed and delivered to patients or billing for quantities larger than what were actually dispensed to patients; forging licensing documents from the State of Utah; and failing to keep proper records of controlled substances.

Many of the medications not delivered were important life-saving medications of elderly patients. One patient, a recent organ transplant recipient, did not receive scheduled anti-rejection medication. This patient was then unable to fill the prescription at another pharmacy because Medicare showed that it had paid for the medications.

According to the civil complaint, from 2018 through 2019, Eco Apothecary and Ammon caused Medicare Part D sponsors to pay at least $1,662,077 for prescriptions they dispensed.  During the same time period, Eco Pharmacy and Ammon caused Medicare to pay at least $1,895.264 for prescriptions they dispensed.  The civil complaint alleges Eco Apothecary and Ammon caused Medicare and Medicaid plan sponsors to pay at least $274,129 and Medicaid at least $11,013 for at least 2,576 prescriptions after it was no longer licensed by the State of Utah to operate as a pharmacy and dispense medication.  

The civil complaint seeks damages and injunctive relief against Ammon and the two businesses.  It asks the court to impose a civil penalty of $64,820 for each individual prescription that was filled in violation of the Controlled Substance Act and a civil penalty of $15,050 for each violation of the Controlled Substances Act’s record-keeping provisions.

As required by law, civil violations of the False Claims Act subject violators to treble damages.

The U.S. Attorney’s office is also seeking an order stopping the defendants and their employees or representatives from directly or indirectly distributing, dispensing, or processing with intent to distribute any controlled substances.   

SALT LAKE CITY – The Department of Justice today announced that it is making $850 million available to help public safety agencies respond to the challenges posed by the outbreak of COVID-19. The Coronavirus Emergency Supplemental Funding program, authorized by the recent stimulus legislation signed by President Trump, will allow eligible state, local and tribal governments to apply immediately for these critical funds. The department is moving quickly to make awards, with the goal of having funds available for drawdown within days of the award.

There are 19 eligible jurisdictions in Utah with eligible allocations ranging from $58,008 to $716,764. The total for Utah is $2,649,050.  The jurisdictions are county or municipal government agencies.

In addition to the Utah allocations, the Navajo Nation is eligible for an allocation of $486,348.

“We are all in this together, and so I am very pleased to announce on behalf of the Department of Justice that more than $2.6 million is available to go directly to our front line public safety officers in Utah to help with the COVID-19 pandemic,” U.S. Attorney John W. Huber said today.  “The President, Congress and the United States Attorney General know how important our first responders are, and this supplemental funding will further bolster our counties and cities in their public safety missions.”

“This is an unprecedented moment in our nation’s history and an especially dangerous one for our front-line law enforcement officers, corrections officials, and public safety professionals,” said Office of Justice Programs Principal Deputy Assistant Attorney General Katharine T. Sullivan. “We are grateful to the Congress for making these resources available and for the show of support this program represents.”

The solicitation, posted by the Bureau of Justice Assistance in the Justice Department’s Office of Justice Programs (OJP), will remain open for at least 60 days and be extended as necessary. OJP will fund successful applicants as a top priority on a rolling basis as applications are received. Funds may be used to hire personnel, pay overtime costs, cover protective equipment and supplies, address correctional inmates’ medical needs and defray expenses related to the distribution of resources to hard-hit areas, among other activities. Grant funds may be applied retroactively to Jan. 20, 2020, subject to federal supplanting rules.

Agencies that were eligible for the fiscal year 2019 State and Local Edward Byrne Memorial Justice Assistance Grant Program are candidates for this emergency funding. A complete list of eligible jurisdictions and their allocations can be found at https://bja.ojp.gov/program/fy20-cesf-allocations.

For more information about the Coronavirus Emergency Supplemental Funding program, please visit https://bja.ojp.gov/funding/opportunities/bja-2020-18553. For more information about the Office of Justice Programs, please visit https://www.ojp.gov/.

The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.

ST. GEORGE, UT – Frank Gene Powell, age 51, of Hurricane, Utah, the lead defendant in a significant federal elder fraud case targeting an 80-year-old widow in Washington, Utah, has reached a plea agreement with federal prosecutors.

Powell pleaded guilty to all six counts he was charged with in a superseding indictment, including conspiracy to commit wire fraud, money laundering, two counts of destruction of records in a federal investigation, concealment of a document or object in an attempt to impair the object’s integrity or availability for use in an official proceeding, and tampering with a witness.

Powell was on state parole at the time of his federal crimes after serving nearly 30 years in state prison for murder.  While he was in prison, he received a 1-to-15 year sentence for sexually assaulting an inmate.

The plea agreement includes a stipulated sentence of 120 months in federal prison and an agreement that Powell will pay almost $274,000 in restitution to the victim of the fraud. The victim is identified as L.N. in court documents. The sentence and restitution are subject to the approval of the Court at sentencing. Powell will also forfeit two vehicles and faces a money judgment of $273,849.20.  Sentencing for Frank Powell is set for May 20, 2020, at 2 p.m. before U.S. District Judge David Nuffer.  The hearing will be in St. George.

“Powell is a career criminal who has fended off decades of rehabilitative attempts in the Utah state criminal justice system.  He’s a convicted murderer and sexual predator, who has now turned his criminal efforts to elder fraud while on state parole,” U.S. Attorney for Utah John W. Huber said today. “With these guilty pleas, he stands convicted of unconscionable crimes against a senior member of the St. George community.  A 10-year sentence is very appropriate in this case and will help ensure that Utah will not fall victim to his crimes again.” 

As a part of his plea agreement, Frank Powell admitted that from around March 2019 and continuing until about Feb. 6, 2020, he conspired with others to devise a fraud scheme with the specific intent to obtain money or property by means of fraudulent representations or promises.  He agreed with his codefendants to engage in a scheme to defraud L.N. by soliciting money and assets in exchange for false promises to perform work for L.N. He also admitted he engaged a fake romantic relationship with L.N. as a part of his scheme to defraud her.

He admitted that he purchased a 2019 GMC Sierra using money he received as a part of his scheme to defraud L.N.   Using money derived from criminal conduct is money laundering.  Several of the counts he pleaded guilty to relate to efforts he took to impede and obstruct the investigation of the case, including concealing cellular phones and money.

Powell also pleaded guilty to witness tampering admitting that in November 2019, he engaged in misleading conduct toward L.N. in an attempt to persuade her from communicating with law enforcement officers investigating the case. Through written correspondence and phone calls, Powell and his codefendant, Faye Renteria, age 42, of Hurricane, made misleading statements and attempted to persuade L.N. in an effort to help them avoid prosecution.  

Frank Powell’s mother and codefendant, Gloria Jean Powell, age 74, of St. George, also has reached a plea agreement in the case.  She pleaded guilty to one count of concealment of a document or object, admitting she concealed or attempted to conceal U.S. currency with the intent to impair an FBI investigation.  She admitted she aided and abetted her son, Frank Powell, and her daughter, Angela McDuffie, age 53, of Lehi, in the conduct.

Sentencing for Gloria Jean Powell is set for May 6, 2020, at 4 p.m. in St. George before  Judge Nuffer.  Her plea agreement includes a stipulated sentence of three months in prison or credit for time served at the date of sentencing, whichever is further from her Feb. 4, 2020, arrest date.  She also will forfeit a 2010 Toyota Venza as a part of the case resolution.     

Eight defendants were charged in a 10-count superseding indictment returned in early February. The indictment alleges the defendants, who have family relationships, conspired to obtain money and assets from the victim in exchange for false promises to perform work on her property. To further advance the scheme, one of the defendants engaged in romance fraud by enticing the victim to enter into a romantic relationship. He used the romantic relationship to manipulate the victim into giving him money and assets.

The indictment includes one count of wire fraud conspiracy, five counts of money laundering conspiracy – spending, two counts of destruction or concealment of records and tangible objects in a federal investigation, one count of concealment of a document or object, and one count of tampering with a witness or victim.

In addition to Frank Gene Powell, Gloria Jean Powell, McDuffie, and Renteria, other defendants include Bubby Mern Shepherd, age 58, of Lodi, California, Terrence Quincy Powell, age 23, of St. George, Rocky James Powell Mott, age 40, of Hurricane, and Martell Taz Powell, age 25, of Cedar City.

Charges are pending against the remaining six defendants in the case. A change of plea hearing is set for Monday in St. George for Renteria.  

Combatting elder abuse and financial fraud targeted at seniors is a key priority of the U.S. Department of Justice and the U.S. Attorney’s Office in Utah. Elder abuse is a serious crime against some of our nation’s most vulnerable citizens, affecting at least 10 percent of older Americans every year.  Together with federal, state, local and tribal partners, the Department of Justice is committed to combatting all forms of elder abuse and financial exploitation through enforcement actions, training and resources, research, victim services, and public awareness.  This holistic and robust response demonstrates the Department’s unwavering dedication to fighting for justice for older Americans.

Assistant U.S. Attorneys in Utah are prosecuting the case.  The FBI is investigating the case. Agents with Utah Adult Probation and Parole have made signification contributions to the investigation.

SALT LAKE CITY– U.S. Attorney John W. Huber is urging Utahns to report suspected fraud schemes related to COVID-19 (the Coronavirus) by calling the National Center for Disaster Fraud (NCDF) hotline (1-866-720-5721) or to the NCDF e-mail address disaster@leo.gov.

In coordination with the Department of Justice, Attorney General William Barr has directed U.S. Attorneys to prioritize the investigation and prosecution of Coronavirus fraud schemes.

“For most of us, times like these bring out the best in us as we look out for our family, neighbors, and care for the vulnerable,” U.S. Attorney John W. Huber said.  “However, fraudsters are always looking for a new way to make money and exploit the fears of those who are at risk.  They will start touting miracle cures for COVID-19 and ask for money to support fraudulent causes or cures. Those who get involved in these fraud schemes are no different than the snake oil salesmen of the past.”

Huber said he is particularly concerned about senior citizens in Utah who are often vulnerable to fraud schemes. “Those who seek to profit by scamming others, especially our elders, must be stopped,” Huber said. “Anyone who hears about a suspected fraud scheme related to COVID-19 should report it immediately through the National Center for Disaster Fraud hotline.”

There is currently no known cure for COVID-19, and citizens should avoid interacting with or buying anything from those who claim there is.        

Examples of these schemes include:

• Individuals and businesses selling fake cures for COVID-19 online and engaging in other forms of fraud.
• Phishing emails from entities posing as the World Health Organization or the Centers for Disease Control and Prevention.
• Malicious websites and apps that appear to share Coronavirus-related information to gain and lock access to your devices until payment is received.
• Seeking donations fraudulently for illegitimate or non-existent charitable organizations.
• Medical providers obtaining patient information for COVID-19 testing and then using that information to fraudulently bill for other tests and procedures.      

The Department of Justice has directed U.S. Attorneys around the nation to appoint a Coronavirus Fraud Coordinator to serve as the legal counsel for matters relating to the Coronavirus, direct the prosecution of Coronavirus-related crimes, and to conduct outreach and awareness activities.   The Coronavirus Fraud Coordinator in Utah is Assistant U.S. Attorney Jacob Strain.

The NCDF can receive and enter complaints into a centralized system that can be accessed by all U.S. Attorneys, as well as Justice Department litigating and law enforcement components to identify, investigate and prosecute fraud schemes.  The NCDF coordinates complaints with 16 additional federal law enforcement agencies, as well as state Attorneys General and local authorities.

To find more about Department of Justice resources and information, please visit www.justice.gov/coronavirus.

A federal jury in Salt Lake City, Utah, convicted California businessman Lev Aslan Dermen, also known as Levon Termendzhyan, of criminal charges today relating to a $1 billion renewable fuel tax credit fraud scheme, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division, U.S. Attorney John W. Huber for the District of Utah, Don Fort Chief of Internal Revenue Service (IRS) - Criminal Investigation, Acting Special Agent-in-Charge Lance Ehrig for the Denver Area Office of Environmental Protection Agency (EPA) - Criminal Investigation Division, and Special Agent-in-Charge Michael Mentavlos for the Denver Area Office of Defense Criminal Investigative Service.

“Today’s guilty verdict brings Lev Dermen and his coconspirators to justice.  They created and implemented this massive biofuel scheme to fund their greed at the expense of all taxpayers,” said Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division.  “The conviction should serve as clear notice that we will vigorously prosecute those criminals who engage in any form of tax fraud.”

“These guilty verdicts show that no amount of bank accounts, shell companies, burner phones, or transfers of millions of dollars to foreign countries will stop the Department of Justice, the U.S. Attorney’s Office, and our law enforcement partners from tracking down money stolen from the government and holding criminals responsible for their wrongdoing,” said U.S. Attorney John W. Huber for the District of Utah.  “I also want to thank the investigators, prosecutors, and support professionals who have dedicated so much time to this important case.” 

“The biofuel tax credit program was established by the government to promote a clean fuel alternative to traditional fuel options.  Mr. Dermen used his company Noil Energy Group to conspire with the Kingston family to corrupt the biofuel tax credit program in an effort to steal over $1 Billion from tax payers and launder the proceeds of this fraud,” said Don Fort, Chief of IRS Criminal Investigation.  “This trial was the culmination of years of investigative effort that traced money through a variety of countries and states through a complicated fraud scheme to eventually put money in the pockets of Mr. Dermen. The complicated nature of the scheme shows the determination with which the defendants had to defraud the American public for the sole purpose of lining their own pockets.”

“The defendants claimed both EPA Renewable Fuel Standard (RFS) program credits and IRS tax credits for biodiesel fuel that did not exist, defrauding taxpayers out of hundreds of millions of dollars,” said Lance Ehrig, EPA Acting Special Agent in Charge. “With this action EPA and its enforcement partners are continuing to protect both the integrity of the RFS program and the American taxpayer.”

“The Defense Criminal Investigative Service (DCIS) will investigate all allegations of financial crimes impacting the Department of Defense," stated Michael Mentavlos, Special Agent in Charge, DCIS Southwest Field Office.  "DCIS, along with our investigative partners, will diligently pursue all appropriate criminal, civil and administrative actions against individuals who violate the taxpayer's trust for illicit financial gain.”

According to evidence presented at a seven-week trial, Dermen was the owner and operator of Noil Energy Group, a California-based fuel company; SBK Holdings USA, a Beverly Hills real estate investment company; and Viscon International, a Nevada fuel additive corporation.  From 2010 to 2016, Dermen conspired with the owners and operators of Washakie Renewable Energy (Washakie), a Utah-based biodiesel company, including its Chief Executive Officer Jacob Kingston, his brother, Chief Financial Officer Isaiah Kingston, and others, including their mother, Rachel Kingston, and Jacob Kingston’s wife, Sally, to fraudulently claim more than $1 billion in renewable fuel tax credits from the IRS.

The IRS administers refundable federal tax credits designed to increase the amount of renewable fuel used and produced in the United States. As part of their scheme, Dermen and Jacob Kingston shipped millions of gallons of biodiesel within the U.S. and from the U.S. to foreign countries and back again to create the appearance that qualifying renewable fuel was being produced and sold.  They also doctored production and transportation records to substantiate Washakie’s fraudulent claims for more than $1 billion in IRS renewable fuel tax credits and credits related to the EPA renewable fuel standard. To further create the appearance they were buying and selling qualifying fuel, the coconspirators cycled more than $3 billion through multiple bank accounts.

As a result of the fraudulent claims, the IRS paid more than $511 million to Washakie and the Kingstons that was distributed between them and Dermen. Jacob and Isaiah Kingston sent more than $21 million in fraudulent proceeds to SBK Holdings USA, Inc., Dermen’s California-based company, and sent $11 million to an associate of Dermen’s at his request. Jacob Kingston used $1.8 million of the fraud proceeds to buy Dermen a 2010 Bugatti Veyron, and they exchanged gifts including a chrome Lamborghini and a gold Ferrari. 

Dermen and Jacob Kingston also laundered $3 million through Dermen’s company, Noil Energy Group, to purchase a mansion in Sandy, Utah for Jacob Kingston and his wife Sally.  Dermen also laundered $3.5 million through his California company, SBK Holdings USA, Inc., to purchase a mansion in Huntington Beach, California.  

Throughout the scheme, Dermen assured Jacob Kingston that he and the Kingstons would be immune from criminal prosecution because they would be protected by Dermen’s “umbrella” of corrupt law enforcement personnel. Jacob and Isaiah Kingston transferred over $134 million in fraudulent proceeds to companies in Turkey and Luxembourg at Dermen’s direction, in purported payment for protection.

The jury found Dermen guilty of conspiracy to commit mail fraud, conspiracy to commit money laundering, and money laundering concealment money laundering, and expenditure money laundering.

The Kingstons, who are all members of the Davis County Cooperative Society, also known as the “Order,” each pleaded guilty on July 19, 2019 for their role in this scheme. Jacob Kingston pleaded guilty to crimes relating to the $1 billion biofuel fraud, including conspiracy to commit mail fraud, aiding and assisting in the filing of false claims with the IRS, conspiracy to commit money laundering, and conspiracy to obstruct justice.  In his plea agreement, he admitted to laundering fraudulent proceeds through Order-related entities and transferring millions in fraudulent proceeds to Order-related entities. Jacob Kingston admitted to conspiring to obstruct justice for attempting to bribe government officials, tamper with witnesses, and destroy evidence based on his agreeing with his family to hide evidence and replace computer hard drives once they learned of an impending search warrant. Under the terms of his plea agreement, Jacob Kingston faces a maximum of thirty years in prison.  He also faces a period of supervised release and other monetary penalties.  Sentencing has not yet been scheduled.

Isaiah Kingston pleaded guilty to his role in the scheme, including to conspiracy to commit mail fraud, aiding and assisting in filing false claims with the IRS, conspiracy to commit money laundering, and conspiracy to obstruct justice.  Under the terms of his plea agreement, he faces a maximum of 20 years in prison. Rachel Kingston pleaded guilty to conspiracy to commit mail fraud, conspiracy to commit money laundering, money laundering, and obstruction of justice. In her plea agreement, she admitted to creating false invoices, backdating documents, and concealing records in advance of a federal search warrant. She faces a maximum of 15 years in prison. Sally Kingston pleaded guilty to conspiracy to commit mail fraud and conspiracy to commit money laundering; she faces a maximum of 15 years in prison. They each also face a period of supervised release. As part of their plea agreements, the Kingstons will be ordered to pay $511 million in restitution to the United States and to forfeit the proceeds of their crimes.

Jacob and Isaiah Kingston both testified at Dermen’s trial.

U.S. District Judge Jill N. Parrish will set Dermen’s sentencing at a later date. At sentencing, he faces a maximum sentence of 20 years in prison for conspiracy to commit mail fraud, conspiracy to commit money laundering, and concealment money laundering, and 10 years in prison for expenditure money laundering. He also faces a period of supervised release, restitution, and monetary penalties.

Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Huber commended special agents of IRS-Criminal Investigation, EPA Criminal Investigation Division, and Department of Defense DCIS who conducted the investigation.  They also thanked Trial Attorneys Richard M. Rolwing, Leslie A. Goemaat, and Arthur J. Ewenczyk and Senior Litigation Counsel John E. Sullivan of the Tax Division, who are prosecuting the case.  

They also thanked the U.S. Department of Justice Criminal Division’s Office of International Affairs, as well as law enforcement partners in the Grand Duchy of Luxembourg and the Republic of Malta for their assistance in the case.

Additional information about the Tax Division and its enforcement efforts may be found on the Division’s website.

SALT LAKE CITY – A federal jury in Salt Lake City convicted California businessman Lev Aslan Dermen, also known as Levon Termendzhyan, of criminal charges Monday afternoon relating to a $1 billion renewable fuel tax credit fraud scheme.

The convictions were announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division, U.S. Attorney John W. Huber for the District of Utah, Don Fort Chief of Internal Revenue Service (IRS) - Criminal Investigation, Acting Special Agent-in-Charge Lance Ehrig of the Denver Area Office of Environmental Protection Agency (EPA) - Criminal Investigation Division, and Special Agent-in-Charge  Michael Mentavlos of the Denver Area Office of Defense Criminal Investigative Service.

“Today’s guilty verdict brings Lev Dermen and his coconspirators to justice.  They created and implemented this massive biofuel scheme to fund their greed at the expense of all taxpayers,” said Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division.  “The conviction should serve as clear notice that we will vigorously prosecute those criminals who engage in any form of tax fraud.”

“These guilty verdicts show that no amount of bank accounts, shell companies, burner phones, or transfers of millions of dollars to foreign countries will stop the Department of Justice, the U.S. Attorney’s Office, and our law enforcement partners from tracking down money stolen from the government and holding criminals responsible for their wrongdoing,” said U.S. Attorney John W. Huber for the District of Utah.  “I also want to thank the investigators, prosecutors, and support professionals who have dedicated so much time to this important case.” 

“The defendants claimed both EPA Renewable Fuel Standard (RFS) program credits and IRS tax credits for biodiesel fuel that did not exist, defrauding taxpayers out of hundreds of millions of dollars,” said Lance Ehrig, EPA Acting Special Agent in Charge. “With this action EPA and its enforcement partners are continuing to protect both the integrity of the RFS program and the American taxpayer.”

“The biofuel tax credit program was established by the government to promote a clean fuel alternative to traditional fuel options.  Mr. Dermen used his company Noil Energy Group to conspire with the Kingston family to corrupt the biofuel tax credit program in an effort to steal over $1 Billion from tax payers and launder the proceeds of this fraud,” said Don Fort, Chief of IRS Criminal Investigation.  “This trial was the culmination of years of investigative effort that traced money through a variety of countries and states through a complicated fraud scheme to eventually put money in the pockets of Mr. Dermen. The complicated nature of the scheme shows the determination with which the defendants had to defraud the American public for the sole purpose of lining their own pockets.”

“The Defense Criminal Investigative Service (DCIS) will investigate all allegations of financial crimes impacting the Department of Defense," stated Michael Mentavlos, Special Agent in Charge, DCIS Southwest Field Office.  "DCIS, along with our investigative partners, will diligently pursue all appropriate criminal, civil and administrative actions against individuals who violate the taxpayer's trust for illicit financial gain.”

According to evidence presented at a seven-week trial, Dermen was the owner and operator of Noil Energy Group, a California-based fuel company; SBK Holdings USA, a Beverly Hills real estate investment company; and Viscon International, a Nevada fuel additive corporation.  From 2010 to 2016, Dermen conspired with the owners and operators of Washakie Renewable Energy (Washakie), a Utah-based biodiesel company, including its Chief Executive Officer Jacob Kingston, his brother, Chief Financial Officer Isaiah Kingston, and others, including their mother, Rachel Kingston, and Jacob Kingston’s wife, Sally, to fraudulently claim more than $1 billion in renewable fuel tax credits from the IRS.

The IRS administers refundable federal tax credits designed to increase the amount of renewable fuel used and produced in the United States. As part of their scheme, Dermen and Jacob Kingston shipped millions of gallons of biodiesel within the U.S. and from the U.S. to foreign countries and back again to create the appearance that qualifying renewable fuel was being produced and sold.  They also doctored production and transportation records to substantiate Washakie’s fraudulent claims for more than $1 billion in IRS renewable fuel tax credits and credits related to the EPA renewable fuel standard. To further create the appearance they were buying and selling qualifying fuel, the coconspirators cycled more than $3 billion through multiple bank accounts.

As a result of the fraudulent claims, the IRS paid more than $511 million to Washakie and the Kingstons that was distributed between them and Dermen. Jacob and Isaiah Kingston sent more than $21 million in fraudulent proceeds to SBK Holdings USA, Inc., Dermen’s California-based company, and sent $11 million to an associate of Dermen’s at his request. Jacob Kingston used $1.8 million of the fraud proceeds to buy Dermen a 2010 Bugatti Veyron, and they exchanged gifts including a chrome Lamborghini and a gold Ferrari. 

Dermen and Jacob Kingston also laundered $3 million through Dermen’s company, Noil Energy Group, to purchase a mansion in Sandy, Utah for Jacob Kingston and his wife Sally.  Dermen also laundered $3.5 million through his California company, SBK Holdings USA, Inc., to purchase a mansion in Huntington Beach, California.  

Throughout the scheme, Dermen assured Jacob Kingston that he and the Kingstons would be immune from criminal prosecution because they would be protected by Dermen’s “umbrella” of corrupt law enforcement personnel. Jacob and Isaiah Kingston transferred over $134 million in fraudulent proceeds to companies in Turkey and Luxembourg at Dermen’s direction, in purported payment for protection.

The jury found Dermen guilty of conspiracy to commit mail fraud, conspiracy to commit money laundering, and money laundering concealment money laundering, and expenditure money laundering.

The Kingstons, who are members of the Davis County Cooperative Society, also known as the “Order,” each pleaded guilty on July 19, 2019 for their role in this scheme. Jacob Kingston pleaded guilty to crimes relating to the $1 billion biofuel fraud, including conspiracy to commit mail fraud, aiding and assisting in the filing of false claims with the IRS, conspiracy to commit money laundering, and conspiracy to obstruct justice. 

In his plea agreement, he admitted to laundering fraudulent proceeds through Order-related entities and transferring millions in fraudulent proceeds to Order-related entities. Jacob Kingston admitted to conspiring to obstruct justice for attempting to bribe government officials, tamper with witnesses, and destroy evidence based on his agreeing with his family to hide evidence and replace computer hard drives once they learned of an impending search warrant. Under the terms of his plea agreement, Jacob Kingston faces a maximum of thirty years in prison.  He also faces a period of supervised release and other monetary penalties.  Sentencing has not yet been scheduled.

Isaiah Kingston pleaded guilty to his role in the scheme, including to conspiracy to commit mail fraud, aiding and assisting in filing false claims with the IRS, conspiracy to commit money laundering, and conspiracy to obstruct justice.  Under the terms of his plea agreement, he faces a maximum of 20 years in prison. Rachel Kingston pleaded guilty to conspiracy to commit mail fraud, conspiracy to commit money laundering, money laundering, and obstruction of justice. In her plea agreement, she admitted to creating false invoices, backdating documents, and concealing records in advance of a federal search warrant. She faces a maximum of 15 years in prison. Sally Kingston pleaded guilty to conspiracy to commit mail fraud and conspiracy to commit money laundering; she faces a maximum of 15 years in prison. They each also face a period of supervised release. As part of their plea agreements, the Kingstons will be ordered to pay $511 million in restitution to the United States and to forfeit the proceeds of their crimes.

Jacob and Isaiah Kingston both testified at Dermen’s trial.

U.S. District Judge Jill N. Parrish will set Dermen’s sentencing at a later date. At sentencing, he faces a maximum sentence of 20 years in prison for conspiracy to commit mail fraud, conspiracy to commit money laundering and concealment money laundering, and 10 years in prison for expenditure money laundering.   He also faces a period of supervised release, restitution, and monetary penalties.           

Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Huber commended special agents of IRS-Criminal Investigation, EPA Criminal Investigation Division, and Department of Defense DCIS who conducted the investigation.  They also thanked Trial Attorneys Richard M. Rolwing, Leslie A. Goemaat, and Arthur J. Ewenczyk and Senior Litigation Counsel John E. Sullivan of the Tax Division, who are prosecuting the case.  

They also thanked the U.S. Department of Justice Criminal Division’s Office of International Affairs, as well as law enforcement partners in the Grand Duchy of Luxembourg and the Republic of Malta for their assistance in the case.

SALT LAKE CITY – U.S. Attorney John W. Huber of Utah joined Attorney General William P. Barr, FBI Director Christopher A. Wray, and Chief Postal Inspector Gary R. Barksdale today in announcing the largest coordinated sweep of elder fraud cases in history.  This year, prosecutors charged more than 400 defendants, far surpassing the 260 defendants charged in cases as part of last year’s sweep.  In each case, offenders allegedly engaged in financial schemes that targeted or largely affected seniors.  In total, the charged elder fraud schemes caused alleged losses of more than $1 billion dollars.

            Four Utah cases (20 total defendants) are included in the coordinated sweep.         

• U.S. v Fairbanks:  Thomas Fairbanks of Logan is charged with wire fraud, securities fraud and money laundering in what the indictment alleges was a fraudulent investment scheme.  As a part of the scheme, the indictment alleges Fairbanks gained the trust of a vulnerable adult and diverted at least $462,000 of her money for personal use. Trial is set for June 8, 2020, in the case.
• U.S. v Anyanwu:  Eight individuals are charged in connection with a fraud scheme primarily targeting widowed women over 65 years old. The indictment alleges that over approximately two years, the defendants defrauded dozens of victims out of more than $6 million. The defendants and coconspirators used social media and social gaming applications to target widows. The indictment alleges they created false identities to befriend potential victims, feigned romantic interest, and eventually pressured them to send money to the defendants. Trial is set for May in the case.
• U.S. v Powell:  Eight individuals are charged in connection with an alleged fraud scheme to obtain money and assets from a 90-year-old widow in Washington, Utah. The charges allege the defendants, who have family relationships, conspired to obtain money and assets from the victim in exchange for false promises to perform work on her property.  To further advance the scheme, one of the defendants engaged in romance fraud by enticing the victim to enter into a romantic relationship.  The charges alleges he used the romantic relationship to manipulate the victim into giving him money and assets. An April trial has been set in the case.
• U.S. v Rust:  For a period of at least 20 years, Gaylen Rust and others offered and sold investments to at least 500 investors located throughout the United States. Within the past five-year period alone, these co-conspirators collected an estimated $193 million dollars in connection with these investments.  They promised investors secured high interest returns through buying, selling and trading silver, according to the indictment.  In reality, besides making about $150 million in Ponzi payments, investor funds were used to support the Rust’s lifestyle. 
   
  Investors were encouraged to pull funds from their home equity, IRA, 401K or other retirement savings accounts or otherwise liquidate from other securities to invest as much as they could for optimum success, charges allege.  Approximately 45 percent of the investors are retirees who used retirement funds to invest with Rust.  The average age of investors is 60. The oldest investor 94.  The case is set for trial in May.
   
  “Americans are fed up with the constant barrage of scams that maliciously target the elderly and other vulnerable citizens,” said Attorney General William P. Barr.  “This year, the Department of Justice prosecuted more than 400 defendants, whose schemes totaled more than a billion dollars. I want to thank the men and women of the Department’s Consumer Protection Branch, which coordinated this effort, and all those in the U.S. Attorneys’ Offices and Criminal Division who worked tirelessly to bring these cases. The Department is committed to stopping the full range of criminal activities that exploit America’s seniors.”
   
  “We brought four significant cases to federal court as a part of this initiative, lodging allegations against 20 individual defendants. Protecting elderly and vulnerable members in Utah communities is one of our highest priorities.  Those who target and take advantage of them should know that we will hold them accountable,” U.S. Attorney John W. Huber said today. “As I have stated many times, we don’t defraud our elders.  We revere them.”
  Huber also expressed appreciation to the many law enforcement partners and other agencies who investigate or assist with the prosecution of elder fraud and abuse cases, including the FBI, U.S. Postal Inspectors, the Security Exchange Commission, the IRS, the Utah Division of Securities, the Commodity Futures Trading Commission, the Utah Attorney General’s Office, and Utah Adult Probation and Parole.
   
   
  Elder Fraud Hotline
  Attorney General Barr also announced the launch of a National Elder Fraud Hotline, which will provide services to seniors who may be victims of financial fraud.  The Hotline will be staffed by experienced case managers who can provide personalized support to callers.  Case managers will assist callers with reporting the suspected fraud to relevant agencies and by providing resources and referrals to other appropriate services as needed.  When applicable, case managers will complete a complaint form with the Federal Bureau of Investigation Internet Crime Complaint Center (IC3) for Internet-facilitated crimes and submit a consumer complaint to the Federal Trade Commission on behalf of the caller.  The Hotline’s toll free number is 833-FRAUD-11
  For the second year, the Department of Justice and its law enforcement partners also took comprehensive action against the money mule network that facilitates foreign-based elder fraud. Generally, perpetrators use a “money mule” to transfer fraud proceeds from a victim to ringleaders of fraud schemes who often reside in other countries. Some of these money mules act unwittingly, and intervention can effectively end their involvement in the fraud. The FBI and the Postal Inspection Service took action against more than 600 alleged money mules nationwide by conducting interviews, issuing warning letters, and bringing civil and criminal cases. Agents and prosecutors in more than 85 federal district participated in this effort to halt the money flow from victim to fraudster. These actions against money mules were in addition to the criminal and civil cases announced as part of this year’s elder fraud sweep.

These outreach efforts have helped to prevent seniors from falling prey to scams and have frustrated offenders’ efforts to obtain even more money from vulnerable elders.

The charges announced today are allegations, and the defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
 

SALT LAKE CITY – A federal grand jury returned an indictment Thursday afternoon charging a Price, Utah, resident with one count of tax evasion and eight counts of aiding and assisting in the preparation of false/fraudulent documents.  At the time of the alleged crimes, he lived in Draper and Bluffdale.

The indictment alleges James Cunningham attempted to evade payment of federal income taxes he and his spouse owed for calendar years 2000, 2001, and 2013 – an amount of approximately $450,000 in income tax, penalties, and interest. The charges allege Cunningham took several affirmative steps to evade paying taxes, including having a person identified in the indictment as M.C. open a personal bank account at Nevada Bank & Trust which he used for his own purposes.  M.C. never used or accessed the account, according to the indictment.

Cunningham used the bank account to receive commissions he earned from his sale of insurance products.  As an example, the indictment alleges a deposit of $3,874.50 was made around May 15, 2013.  By depositing the money into an account he controlled but was not named on, Cunningham concealed his income from the United States.  In another instance, the indictment alleges that in June 2014 Cunningham caused $99,999.99 of his commissions to be deposited into a bank account held by J.C.

The indictment also alleges Cunningham used other people to obtain insurance licenses so he could sell insurance products and earn income under other names. In one instance, according to the indictment, he had M.C. obtain a life insurance license.  Cunningham, the indictment alleges, used M.C.’s license to earn commissions totaling $18,891.02. Cunningham also used and controlled bank accounts belonging to other people to receive commission income.

The eight counts of aiding or assisting in the preparation of false or fraudulent documents charge Cunningham with willfully aiding and assisting in the preparation and submission of several different tax forms that were submitted to the IRS. The indictment alleges the returns were materially false and fraudulent and that at the time of preparation and submission to the IRS, Cunningham knew the taxpayers were not entitled to claim deductions in the claimed amounts and that the reported income was false.

A summons will be issued to Cunningham to appear for an initial appearance on the charges. The tax evasion count carries a potential maximum penalty of five years in prison.  Each of the eight counts of aiding and assisting a fraudulent tax return carries a three year maximum sentence.

Indictments are not findings of guilt.  Individuals charged in indictments are presumed innocent unless or until proven guilty in court.

The U.S. Attorney’s Office in Salt Lake City is prosecuting the case.  IRS-Criminal Investigation special agents are conducting the investigation.

SALT LAKE CITY– United States Attorney John W. Huber announced today the creation of Utah Women in Leadership (UWIL), an inter-agency initiative designed to bring together employees of the U.S. Attorney’s Office, the Federal Public Defender’s Office, U.S. District Court, the U.S. Probation Office, the U.S. Marshals Service, and other federal agencies and civil practitioners to foster professional development and association.

UWIL will offer quarterly presentations by speakers and panels on a variety of topics, including mentor/mentee relationships, leadership and courage, the art of a balanced life, effective communication, bias/diversity/inclusion, leading out/leaning in, and being the only woman in the room. In addition, UWIL is committed to community service and outreach to younger women who have an interest in federal public service work.

Elizabeth Kronk Warner, Dean of the University of Utah’s S.J. Quinney College of Law, and the first woman and first Native American to hold that title, was the inaugural speaker for UWIL. She spoke on Thursday at the U.S. Attorney’s Office about the experiences that have defined her professionally and personally. 

Future speakers for UWIL will include community and business leaders, educators,  professional coaches, and athletes, among others.

While the U.S. Attorney’s Office is taking a leadership role in organizing the group, which will be chaired by Jennifer E. Gully, an Assistant U.S. Attorney. A steering committee  comprised of representatives from other federal agencies and partners will lead the group.

Steering Committee members for 2020-2021 include Melina Shiraldi, Assistant U.S. Attorney; Daphne Oberg, Assistant Public Defender; Anne Morgan, Chief Deputy Clerk, U.S. District Court; Kathryn Kerkhoff, Special Agent, Department of Transportation, Office of the Inspector General; Carissa Spencer, Special Agent, Housing and Urban Development, Office of the Inspector General; and Elizabeth Schulte, Department of the Interior, Office of the Solicitor.

Huber used Thursday’s inaugural meeting to announce the appointment of a new First Assistant U.S. Attorney for Utah. Andrea Martinez, currently the Deputy Section Chief of Violent Crimes, will become the second in command in the U.S. Attorney’s Office. Her predecessor, Jared Bennett, will begin service as a federal magistrate judge in May. 

Ms. Martinez has served in a number of key positions during her 10 years in the office, including Senior Litigation Counsel, Project Safe Childhood Coordinator, and the Violence Against Women Act Coordinator.  She has also served as the office’s Diversity Chairperson for more than six years.  Prior to joining the U.S. Attorney’s Office in 2010, she was a state court prosecutor for more than eight years.

“Andrea’s demeanor is one of calm confidence and professionalism.  She is approachable to all, and impeccably trustworthy.  Although strong and certainly one who can hold to a worthy position, she is also humble and willing to see another’s perspective.  In her supervisory capacity, she has gained experience in fostering success in others.  She has numerous skills that will make her an excellent First Assistant U.S. Attorney in our office,” U.S. Attorney John W. Huber said.

SALT LAKE CITY – Norma Llamas Rodriguez, age 46, of Moreno Valley, California, and her son, Carlos Arturo Garcia, age 21, of West Valley City, are charged with firearms trafficking in a seven-count federal indictment unsealed Monday afternoon.               

According to the indictment, from about June 10, 2017, and continuing until at least Feb. 12, 2019, Llamas Rodriguez and Garcia purchased at least 48 firearms in transactions conducted through FFLs.  The indictment alleges that at no time did either defendant possess a Federal Firearms License (FFL) required to be lawfully engaged in the business of dealing in firearms.

 Seven of the firearms Llamas Rodriguez and Garcia purchased were FN M249S rifles, which are semi-automatic belt-fed tripod mount rifles.  Llamas Rodriguez and Garcia purchased the rifles from FFLs between Nov. 20, 2018, and Feb. 12, 2019 for approximately $7,485-$7,895 using U.S. Postal money orders. During the same period, the indictment alleges the pair transferred firearms to others without conducting lawful transfers through FFLs.

ATF special agents in Utah launched an investigation in February 2019 after receiving information from an FFL concerned about a suspicious purchase. The FFL reported that they had listed an FN Model M249S belt-fed rifle for sale for $7,900.  A buyer in Utah attempted to purchase the firearm. According to a complaint in the case, the FFL was concerned that it might be a scam so he reviewed additional information and noticed that the Utah purchaser had used the account to purchase two other FN M249S rifles within the past month. The FFL contacted the sellers of the other rifles and they did not report any issues.  After the FFL received a U.S. Postal money order for the firearm, Llamas Rodriguez reached out to him and requested a refund for the firearm.  The FFL reported Llamas was “spooked” and wanted her money back.  The FFL started researching Llamas Rodriguez on the internet and then contacted the ATF after he became suspicious with her purchase of $24,000 worth of firearms in such a short period of time, according to the complaint.

The complaint alleges that ATF continued to investigate the two FN M249S rifles Llamas Rodriguez purchased and learned that the firearms were shipped to FFLs in Salt Lake City and Murray where Llamas Rodriguez and Garcia picked them up.  They also found that between October 2017 and December 2018, Llamas had purchased an additional 22 AR-15 type rifles and four handguns from one of the FFLs.

ATF served a search warrant at two mobile homes in South Salt Lake City on Feb. 14, 2019. Agents found three firearms, documentation showing wire transfers to/from Mexico, multiple firearm operator manuals, and $7,400 in cash.  Llamas Rodriguez was not at the residence.  Garcia was there and, according to the complaint, told agents Llamas Rodriguez was buying the firearms for Hispanic males in California and was on her way to California with one of the FN M249S rifles.

During the investigation, ATF agents learned on March 3, 2018, six AR-15 firearms were seized at the Nogales Port of Entry on a bus entering Mexico from the United States. Four of those firearms were traced to Llamas Rodriguez.  Records show Llamas Rodriquez purchased the firearms just two days prior on March 1, 2018.  Agents traced two others to purchases she made on Feb. 22, 2018.    

The indictment charges the pair with one count of dealing in firearms without a license.  Llamas Rodriguez is also charged with four counts of false statements in the acquisition of a firearm and Garcia is charged with two counts of making a false statement in the acquisition of a firearm.  The maximum potential penalty for dealing in firearms without a license is five years in prison.  Each of the false statements in the acquisition of a firearm counts has a potential sentence of 10 years in prison.

Llamas Rodriguez was arrested on the complaint in California and had an initial appearance in federal court in California.  She was released on conditions, including a $100,000 bond.  She had an initial appearance in Salt Lake City Monday afternoon where she entered a plea of not guilty to the charges.  She continues on the conditions of release set in California. Llamas Rodriguez is in the country on a green card. She is a former resident of West Valley City.

Garcia, a U.S. citizen, was taken into custody when he came to the federal courthouse Monday afternoon. He had an initial appearance Tuesday and entered a not guilty plea to the charges.  He was released on conditions of supervised release.

After a five-day trial, a federal jury in Salt Lake City, Utah, found defendant Alan Covington guilty on three hate crime charges stemming from an incident in which the defendant attacked three men with a metal pole because he believed the men were Mexican.

The verdicts were announced by Eric Dreiband, Assistant Attorney General for the Civil Rights Division; John W. Huber, United States Attorney for the District of Utah; and Paul H. Haertel, Special Agent in Charge of the Salt Lake City Field Office of the Federal Bureau of Investigation.

Evidence presented at trial established that on Nov. 27, 2018, Covington entered a tire store, shouted at employees that he wanted to “kill Mexicans,” and then struck an employee in the head with a metal pole. The father of the victim rushed to help his son, who had been knocked to the ground with a serious head injury. While the father cradled his son’s head, Covington used the metal pole to strike the father in the back. When a third man tried to intervene to chase off the defendant, Covington swung the metal pole in an attempt to injure him. Covington was apprehended by police near the tire store, with a metal pole and a hatchet in his possession.

A sentencing date has not yet been set by U.S. District Judge Howard C. Nielson Jr.  Covington faces a maximum sentence of life in in prison and a $250,000 fine.

The case was investigated by the Salt Lake City Field Office of the FBI, with the cooperation of the Salt Lake City Police Department.  The case is being prosecuted by Assistant U.S. Attorney J. Drew Yeates of the United States Attorney’s Office and Special Litigation Counsel Rose E. Gibson of the Civil Rights Division.

SALT LAKE CITY– After a five-day trial, a federal jury in Salt Lake City, Utah, found defendant Alan Covington guilty on three hate crime charges stemming an incident in which the defendant attacked three men with a metal pole because he believed the men were Mexican.

The verdicts were announced this afternoon by Eric Dreiband, Assistant Attorney General for the Civil Rights Division; John W. Huber, United States Attorney for the District of Utah; and Paul H. Haertel, Special Agent in Charge of the Salt Lake City Field Office of the Federal Bureau of Investigation.

“In America, we have the right to wake each day and pursue work and family activities without the fear of a violent assault because of our ethnicity or perceived national origin.  When an offender violates this basic civil right, we will hold him accountable,” U.S. Attorney John W. Huber said today.  “Today, a jury of his peers held Mr. Covington responsible for violating the civil rights of the victims in this case, who were physically injured and traumatized.”

"Hate has no place in our society, and as the victims in this case testified, the brutal assault against them has completely altered their lives forever," said Paul H. Haertel, Special Agent in Charge of the FBI's Salt Lake City Field Office.  "Hate crimes are the highest priority of the FBI's Civil Rights program.  They devastate not only the victims but an entire community, and we will aggressively investigate those whose biases motivate their crimes."

Evidence presented at trial established that on November 27, 2018, Covington entered a tire store, shouted at employees that he wanted to “kill Mexicans,” and then struck an employee in the head with a metal pole.  The father of the victim rushed to help his son, who had been knocked to the ground with a serious head injury.  While the father cradled his son’s head, Covington used the metal pole to strike the father in the back.  When a third man tried to intervene to chase off the defendant, Covington swung the metal pole in an attempt to injure him. Covington was apprehended by police near the tire store, with a metal pole and a hatchet in his possession.

A sentencing date has not been set by U.S. District Judge Howard C. Nielson, Jr.  Covington faces a maximum sentence of life in prison after the jury found that an enhancement for “attempt to kill,” associated with count one of the indictment, applied in the case.

The case was investigated by the Salt Lake City Field Office of the FBI, with the cooperation of the Salt Lake City Police Department.  The case is being prosecuted by Assistant U.S. Attorney J. Drew Yeates of the United States Attorney’s Office and Special Litigation Counsel Rose E. Gibson of the Civil Rights Division.

A federal grand jury in Salt Lake City, Utah, returned an indictment today charging Sergio Sosa, and his adult children, Alissa and David Sosa, with conspiracy to defraud the United States, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and United States Attorney John W. Huber for the District of Utah. Sergio Sosa was also charged with one count of tax evasion, and he and his children were also each charged with one count of corruptly endeavoring to obstruct the administration of the internal revenue laws. 

According to the indictment, Sosa owned and operated Sergio Central Latino (SCL), a tax return preparation business in Orem, Utah, where both Alissa and David worked.  From 2003 through 2017, Sosa allegedly did not timely file his personal tax returns and after multiple audits, the Internal Revenue Service (IRS) determined that he owed more than $750,000 in unpaid taxes. When the IRS began collection efforts, Sosa and his children allegedly agreed to obstruct IRS collection of the outstanding taxes by hiding Sosa’s personal assets, residential properties, and by titling SCL in the children’s names. 

The indictment also alleges that when the IRS suspended SCL’s ability to electronically file client tax returns due to Sosa’s unpaid taxes, David Sosa changed SCL’s business name and obtained electronic filing authorization in a third party’s name. It is further alleged that Alissa Sosa falsely represented to the IRS that she owned a residence that was, in fact, her father’s, and that she withdrew funds from an account that she knew had been levied by the IRS. As of 2019, Sosa allegedly owes more than $1.1 million in taxes, penalties, and interest. 

If convicted, the Sosas each face a statutory maximum sentence of five years in prison for the conspiracy charge and three years in prison for corruptly endeavoring to obstruct the administration of the internal revenue laws. Sergio Sosa faces an additional five years in prison for tax evasion. The Sosas also face a period of supervised release, restitution, and monetary penalties. 

An indictment merely alleges that crimes have been committed. The defendant is presumed innocent until proven guilty beyond a reasonable doubt.

Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Huber thanked special agents of IRS-Criminal Investigation, who conducted the investigation, and Assistant U.S. Attorney Ruth Hackford-Peer, and Trial Attorney Erin S. Mellen of the Tax Division, who are prosecuting the case. 

SALT LAKE CITY -- A federal grand jury in Salt Lake City, Utah, returned an indictment Thursday afternoon charging Sergio Sosa, and his adult children, Alissa and David Sosa, with conspiracy to defraud the United States, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and United States Attorney John W. Huber for the District of Utah.

Sergio Sosa was also charged with one count of tax evasion, and he and his children were each charged with one count of corruptly endeavoring to obstruct the administration of the internal revenue laws.

According to the indictment, Sosa owned and operated Sergio Central Latino (SCL), a tax return preparation business in Orem, Utah, where both Alissa and David worked.  From 2003 through 2017, Sosa allegedly did not timely file his personal tax returns and after multiple audits, the Internal Revenue Service (IRS) determined that he owed more than $750,000 in unpaid taxes. When the IRS began collection efforts, Sosa and his children allegedly agreed to obstruct IRS collection of the outstanding taxes by hiding Sosa’s personal assets, residential properties, and by titling SCL in the children’s names.

The indictment also alleges that when the IRS suspended SCL’s ability to electronically file client tax returns due to Sosa’s unpaid taxes, David Sosa changed SCL’s business name and obtained electronic filing authorization in a third party’s name. It is further alleged that Alissa Sosa falsely represented to the IRS that she owned a residence that was, in fact, her father’s, and that she withdrew funds from an account that she knew had been levied by the IRS.  As of 2019, Sosa allegedly owes more than $1.1 million in taxes, penalties, and interest.

If convicted, the Sosas each face a statutory maximum sentence of five years in prison for the conspiracy charge and three years in prison for corruptly endeavoring to obstruct the administration of the internal revenue laws. Sergio Sosa faces an additional five years in prison for tax evasion. The Sosas also face a period of supervised release, restitution, and monetary penalties.

An indictment merely alleges that crimes have been committed.  Individuals charged in an indictment are presumed innocent until proven guilty beyond a reasonable doubt.

Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Huber thanked special agents of IRS-Criminal Investigation, who conducted the investigation, and Assistant U.S. Attorney Ruth Hackford-Peer and Trial Attorney Erin S. Mellen of the Tax Division, who are prosecuting the case. 

Today the Department of Justice’s Civil Rights Division and the U.S. Attorney’s Office for the District of Utah announced a settlement agreement with Utah State University (“USU” or the “University”) to ensure the University responds adequately to sexual harassment, including sexual assault, of students in its education programs and activities.

“Sexual harassment and violence have no place on college campuses, and too often deny students their right to an equal education. No student should feel unsafe because of a school’s failure to address sexual violence and its devastating impacts,” said Assistant Attorney General Eric Dreiband.  “We look forward to working with USU to implement this agreement and to ensure that students can learn in a safe and healthy environment.”

“Utah schools should be free of discrimination, including sexual harassment and sexual assault.  When such misconduct occurs, schools must know how to respond appropriately,” said John W. Huber, U.S. Attorney for the District of Utah.  “We are pleased that USU has joined with us as a partner in these efforts.”

The settlement, when fully implemented, will resolve the Department’s compliance review of USU under Title IX of the Education Amendments of 1972 (Title IX), which prohibits sex discrimination in education programs and activities receiving federal financial assistance. The Department initiated the review in 2017 based on allegations that the University failed to respond to numerous reports of serious student-on-student sexual assault. USU is a recipient of financial assistance from the Department.

The Department reviewed USU’s policies, procedures, and responses to sexual harassment complaints over a more than four-year period and concluded that the University did not comply with Title IX. The agreement announced today details specific steps USU has agreed to take to improve its investigation and resolution of sexual harassment complaints, help students, faculty, and staff understand their reporting options, duties, and obligations with respect to sexual harassment, and ensure that members of the campus community know where to go for resources and support.

Under the agreement, USU will:

• revise its notice of nondiscrimination and all other relevant sexual harassment policies, procedures, and practices;
• respond promptly, equitably, and adequately to known sexual harassment that has created a hostile environment;
• train students and employees on University policies and federal laws pertaining to sexual harassment, how and to whom they can report allegations of sexual harassment and retaliation, details on the resources available and how to access them, and the University’s Title IX grievance procedures and potential outcomes;
• conduct climate surveys to collect information on students’ understanding of USU’s reporting procedures, the effectiveness of the University’s outreach, education, and prevention efforts, and the incidence of sexual harassment and related retaliation; and
• ensure the individuals designated to administer and coordinate Title IX efforts receive adequate training, resources, and support necessary to coordinate these efforts effectively.

The Department will monitor compliance with the terms of the agreement, which will be in effect through the 2022-2023 academic year.

Combating sex discrimination in education is a top priority of the Department of Justice’s Civil Rights Division. Additional information about the Civil Rights Division of the Justice Department is available on its website at www.justice.gov/crt.

SALT LAKE CITY – Today the Department of Justice’s Civil Rights Division and the U.S. Attorney’s Office for the District of Utah announced a settlement agreement with Utah State University (“USU” or the “University”) to ensure the University responds adequately to sexual harassment, including sexual assault, of students in its education programs and activities.

“Sexual harassment and violence have no place on college campuses, and too often deny students their right to an equal education. No student should feel unsafe because of a school’s failure to address sexual violence and its devastating impacts,” said Assistant Attorney General Eric Dreiband.  “We look forward to working with USU to implement this agreement and to ensure that students can learn in a safe and healthy environment.”

“Utah schools should be free of discrimination, including sexual harassment and sexual assault.  When such misconduct occurs, schools must know how to respond appropriately,” said John W. Huber, U.S. Attorney for the District of Utah.  “We are pleased that USU has joined with us as a partner in these efforts.”

The settlement, when fully implemented, will resolve the Department’s compliance review of USU under Title IX of the Education Amendments of 1972 (Title IX), which prohibits sex discrimination in education programs and activities receiving federal financial assistance. The Department initiated the review in 2017 based on allegations that the University failed to respond to numerous reports of serious student-on-student sexual assault. USU is a recipient of financial assistance from the Department.

The Department reviewed USU’s policies, procedures, and responses to sexual harassment complaints over a more than four-year period and concluded that the University did not comply with Title IX. The agreement announced today details specific steps USU has agreed to take to improve its investigation and resolution of sexual harassment complaints, help students, faculty, and staff understand their reporting options, duties, and obligations with respect to sexual harassment, and ensure that members of the campus community know where to go for resources and support.

Under the agreement, USU will:

• revise its notice of nondiscrimination and all other relevant sexual harassment policies, procedures, and practices;
• respond promptly, equitably, and adequately to known sexual harassment that has created a hostile environment;
• train students and employees on University policies and federal laws pertaining to sexual harassment, how and to whom they can report allegations of sexual harassment and retaliation, details on the resources available and how to access them, and the University’s Title IX grievance procedures and potential outcomes;
• conduct climate surveys to collect information on students’ understanding of USU’s reporting procedures, the effectiveness of the University’s outreach, education, and prevention efforts, and the incidence of sexual harassment and related retaliation; and
• ensure the individuals designated to administer and coordinate Title IX efforts receive adequate training, resources, and support necessary to coordinate these efforts effectively.

The Department will monitor compliance with the terms of the agreement, which will be in effect through the 2022-2023 academic year.

Combating sex discrimination in education is a top priority of the Department of Justice’s Civil Rights Division. Additional information about the Civil Rights Division of the Justice Department is available on its website at www.justice.gov/crt.

SALT LAKE CITY – U.S. Attorney General William P. Barr highlighted steps the Department of Justice is taking to combat the dangerous and unlawful practices of “sanctuary jurisdictions” in a speech at the National Sheriffs’ Association Winter Legislative and Technology Conference in Washington, D.C., late Monday afternoon.  Utah’s U.S. Attorney John W. Huber shares those concerns, but says continued communication, cooperation and a shared commitment to protect Utah communities from criminal conduct is working in ICE cases in Utah.

“Let us state the reality upfront and as clearly as possible: When we are talking about sanctuary cities, we are talking about policies that are designed to allow criminal aliens to escape.  These policies are not about people who came to our country illegally but have otherwise been peaceful and productive members of society.  Their express purpose is to shelter aliens whom local law enforcement has already arrested for other crimes.  This is neither lawful nor sensible,” the Attorney General said in his remarks to the Sheriffs Association. “It is not lawful because the Constitution vests the federal government with the sole authority to make and enforce immigration law,” the Attorney General said Monday.

“In 2017, I spoke from the podium in the White House Press Briefing Room regarding unwise sanctuary policies across the nation.  I was reminded of those concerns as I listened to the remarks Attorney General Barr shared with sheriffs Monday afternoon,” U.S. Attorney John W. Huber said. “Removing unnatural impediments to cooperation between local and federal law enforcement will help keep our neighborhoods safe,” Huber said today.

“Each year my office prosecutes hundreds of criminal aliens with extensive criminal records and, in many cases, multiple previous deportations.  We find these criminals back in Utah committing new crimes. If these offenders are released from local jails into our communities without coordinating with federal officers, there is no question our communities will be less safe.  Unlike some areas around the country, we have the support and cooperation of Utah law enforcement agencies as we all work together to protect Utah communities,” Huber said.

According to Huber, the U.S. Attorney’s Office in Salt Lake City filed 42 illegal re-entry of previously removed alien cases in January of this year. The overwhelming majority of the defendants in these cases were illegal aliens found in local jails. 

“Cooperation between law enforcement agencies and ICE is in the best interest of the residents of Utah,” said Robert Culley, U.S. Immigration and Customs Enforcement, Enforcement and Removal Operations field director in Salt Lake City. “Let me be clear, we target specific individuals, not random immigrants in our communities. These criminal aliens come to our attention specifically because they have been arrested and booked by local law enforcement following the alleged commission of a crime. Allowing criminal aliens to be released to the streets puts our communities in avoidable potential danger.”

Examples of Utah cases include: 

U.S. v Luis Fernando Bueso-Romero: A federal complaint filed Feb. 5, 2020, charges Bueso-Romero with damaging a building by means of fire.  The complaint charges him in connection with a Feb. 1, 2020, fire at the Overlook Point Apartments in West Valley City. At about 8:25 p.m. that day, West Valley Fire and Police Departments were dispatched to a fire at the apartments.  They found an eight-unit apartment building engulfed in flames. Two residents had to evacuate by jumping off second story balconies.  The investigation led police officers to Bueso-Romero, a citizen of Honduras living illegally in the United States. Police officers took him into custody and booked into the county jail for attempted murder, aggravated arson, criminal trespass, and causing a catastrophe.  Federal authorities filed a detainer with the jail. The U.S. Attorney’s Office filed federal charges Feb. 5 and brought him into federal custody.  He faces up to 20 years in federal prison with a five-year minimum mandatory sentence if he is convicted of the charges in the complaint.  His next court hearing is Feb. 20, 2020.

U.S. v Roberto Miramontes Roman – Roman is an armed drug dealer who boasted that he would kill a law enforcement officer to stay out of jail.  He was previously deported to Mexico after being convicted of two felony drug offenses. On both occasions, he was found in possession of cocaine and firearms.  After deportation, he twice re-entered the country illegally.   On Jan. 5, 2010, he was stopped by Millard County Sheriff’s Deputy Josie Greathouse Fox on suspicion of drug trafficking.  He had just sold methamphetamine and was armed with a handgun and a semi-automatic rifle.  To avoid being apprehended, Roman intentionally shot and killed Deputy Fox. Following a state trial in the case, a federal grand jury charged Roman with intentionally killing a local law enforcement officer to avoid apprehension for a felony drug crime, drug trafficking offenses, firearms violations, and illegal re-entry by a previously removed alien.  A jury convicted him on all counts.  In May 2017, Roman was sentenced to life in prison plus 80 years in federal prison.

U.S. v Geronimo Cuara – Cuara had two previous removals from the United States – one on Aug. 9, 2012, and a second on Sept. 29, 2018.  Prior to his removal in September 2018, he was convicted in Utah of possession of a firearm by an illegal alien and illegal re-entry of a previously removed alien.  He was sentenced to 18 months in federal prison and one year of supervised release.

A few short months after his last conviction and removal, Cuara was back in Salt Lake County. On the Sunday evening, May 27, 2019, during Memorial Day weekend, many people were outside in their front yards celebrating a holiday weekend.  Cuara was walking down the street when he pulled out a gun and began firing multiple shots into the air.  Several people initially believed the shots were fireworks, but then realized what was actually happening.  People grabbed their children and ran for cover inside their houses. 

 Residents of the neighborhood were in fear for their safety.  Cuara walked a short distance and again removed the gun from his waistband, pointed it in the air, and fired several more shots. This was not new behavior for him. His prior conviction for illegal firearm possession was for the same conduct – using the firearm to shoot bullets into the air. 

He was charged in a two-count indictment with felon in possession of firearm and illegal re-entry of a previously removed alien. He pleaded guilty to both counts and was sentenced to 46 months prison and three years of supervised release.  He also received an eight-month sentence for his supervised release violation.  Four months of that sentence will run consecutive to his new 46-month sentence. 

U.S. v Harlin Colindres-Ramos:  Ramos is an illegal alien with four previous deportations from the United States. Less than a year after his most recent removal, Ramos was discovered back in the United States. 

“Please don't kill me. I have kids.”  The victim's plea was in vain, as Harlin Ramos stabbed him eight times, including a fatal thrust to the heart. In April 2014, according to reports and court records, Joaquin Gonzalez had just left a movie when a complete stranger stabbed him to death.  Gonzalez and a woman left the Gateway movie theater about 1:20 a.m. and returned to a car at 515 W. 100 South. Ramos was selling drugs in the area.  He opened Gonzalez's passenger-side door, according to an arrest affidavit. Ramos and Gonzalez started fighting, during which time Ramos began stabbing Gonzalez.  Ramos ultimately fled the scene.  Despite aid from emergency responders, Gonzalez died at the scene. Officers eventually found Ramos at a motel near 1500 W. North Temple. They also found Ramos’ backpack, cellphone, and identification card at the scene.  Bloodstained clothing, with Gonzalez’s DNA on it, was found in the room. 

Ramos was convicted in state court of murder and was sentenced to 15 years to life.  The United States Attorney’s Office also filed federal charges for illegal re-entry of previously removed alien. The federal case is pending.

SALT LAKE CITY – A federal indictment unsealed Wednesday charges Dustin Erhardt, age 33, of Beaverton, Ore., with five counts of wire fraud in connection with what the indictment alleges was a scheme to use his position and access as a contractor to defraud a Provo company.

According to the indictment, Erhardt began working as a contractor for Dark Energy, a Provo business, on March 27, 2017. His primary job was to do marketing for Dark Energy.  He worked remotely and never met the owner of the company in person, the indictment says.  His responsibilities included managing Dark Energy’s Amazon seller account. 

Dark Energy makes military grade power products, including the Poseidon Device, which is a portable charger that is waterproof and crushproof.  The device retails for $99.99, according to the indictment.  One of the places the company sells its products is on Amazon. The company keeps its products at a warehouse in Salt Lake City, managed by Agile Supply Chain Strategies.

The indictment alleges that from about July 6, 2017 through about Dec. 7, 2017, Erhardt devised a scheme to defraud his employer.  As a part of the scheme, Erhardt used Dark Energy’s confidential information without authorization, including login information to its warehouse, to ship to company’s products to himself or to Amazon Fulfillment Centers for sale on his own Amazon account.  The indictment alleges he pocketed the proceeds of the scheme.  According to the indictment, Erhardt stole at least 1,102 Poseidon Devices from Dark Energy through his scheme. 

The indictment alleges that when the company discovered that there were unauthorized sellers on Amazon, who had somehow acquired the Poseidon devices, Erhardt offered to find out who the unauthorized sellers were in an effort to conceal his theft from the company.  When Erhardt was laid off in December 2017, Dark Energy was still unaware he was the unauthorized Amazon seller.  He continued to sell the remaining Poseidon Devices he had diverted from the company. As the investigation into continued, law enforcement officers discovered Erhardt was the unauthorized seller.

Erhardt was arrested Wednesday morning in Oregon and had an initial appearance in federal court in Oregon.  He is not in custody.  His next court appearance will be Thursday at 3:45 p.m. before U.S. Magistrate Furse in Salt Lake City. The maximum potential penalty for each of the five counts of wire fraud is 20 years in federal prison.

Indictments are not findings of guilt.  Individuals charged in indictments are presumed innocent unless or until proven guilty in court.

Assistant U.S. Attorneys in Salt Lake City are prosecuting the case.  It is being investigated by the FBI’s Cyber Task Force and Provo Police Department Detective Robert Payne, who is a member of the Cyber Task Force.

SALT LAKE CITY – A federal grand jury returned a 10-count indictment Thursday afternoon charging eight individuals in connection with an alleged fraud scheme to obtain money and assets from an 80-year-old widow who lives in Washington, Utah.  The indictment was unsealed Tuesday afternoon.

The indictment alleges the defendants, who have family relationships, conspired to obtain money and assets from the victim in exchange for false promises to perform work on her property. To further advance the scheme, one of the defendants engaged in romance fraud by enticing the victim to enter into a romantic relationship. He used the romantic relationship to manipulate the victim into giving him money and assets.

The indictment includes one count of wire fraud conspiracy, five counts of money laundering conspiracy – spending, two counts of destruction or concealment of records and tangible objects in a federal investigation, one count of concealment of a document or object, and one count of tampering with a witness or victim.

“We prioritize investigations and prosecutions where seniors are targeted for victimization,” U.S. Attorney John W. Huber said today.  “We revere our elders, we do not defraud them.”

Individuals charged in the indictment are Frank Gene Powell, age 51, of Hurricane, Bubby Mern Shepherd, age 58, of Lodi, California, Gloria Jean Powell, age 74, of St. George, Faye Ann Renteria, age 42, of Hurricane, Terrence Quincy Powell, age 23, of St. George, Rocky James Powell Mott, age 40, of Hurricane, Martell Taz Powell, age 25, of Cedar City, and Angela Ruth McDuffie, age 53, of Lehi.

Seven of the eight defendants are in custody.  Shepherd will have an initial appearance on the indictment in California Wednesday. 

Frank Powell, Faye Ann Renteria, Gloria Powell, Rocky Mott, Taz Powell and Angela McDuffie will have an initial appearance on the indictment at 9 a.m. Thursday in St. George, Utah, before U.S. Magistrate Judge Paul Kohler.  A summons was issued to Terrence Quincy Powell to appear at the hearing. 

The indictment alleges that starting around March 2019 through October 2019, several of the defendants began soliciting payments from L.N. by offering to perform routine repairs and odd jobs on her property. L.N. created a list of requested repairs, such as painting the exterior of the house, resurfacing the driveway, doing yard work, hammering protruding nails on the roof, fixing a door handle on a car, removing grease spots on the driveway, and installing carpet on an outdoor deck. 

According to the indictment, most of the jobs they promised to do were never completed or the quality of work was extremely poor and fell well below any expectation of professionally done work. The victim paid the defendants at least $273,849.20, both indirectly and directly, for this work.

Frank Powell engaged in the romance fraud scam with the victim and told L.N. that he intended to marry her while maintaining a domestic partnership with Renteria.  According to the indictment, he is legally married to another woman not involved in the conspiracy.

The money laundering counts allege four defendants, Frank Powell, Gloria Powell, Renteria, and Taz Powell, used money derived from their alleged unlawful activity to buy cars, a Polaris Razor, and a trailer. 

Frank Powell and Renteria are charged with two counts of destruction of records or tangible objects in a federal investigation – specifically cell phones – in an effort to impede the investigation of the case.  They are also charged with tampering with a victim in an effort to avoid prosecution.  Powell and Renteria, according to the indictment, contacted L.N. through written correspondence and phone calls in which they made misleading statements and attempted to persuade L.N. to withhold information from law enforcement and help them avoid prosecution.  Frank Powell and Faye Renteria were arrested on a federal complaint in November charging them with tampering with a victim or witness.

The potential maximum penalty for each count of wire fraud conspiracy, destruction or concealment of records or tangible objects in a federal investigation, concealment of a document or object, and tampering with a witness is 20 years in federal prison.  The money laundering counts are up to 10 years per count.

Indictments are not findings of guilt.  Individuals charged in indictments are presumed innocent unless or until proven guilty in court.

Combatting elder abuse and financial fraud targeted at seniors is a key priority of the U.S. Department of Justice and the U.S. Attorney’s Office in Utah. Elder abuse is a serious crime against some of our nation’s most vulnerable citizens, affecting at least 10% of older Americans every year.  Together with federal, state, local and tribal partners, the Department of Justice is committed to combatting all forms of elder abuse and financial exploitation through enforcement actions, training and resources, research, victim services, and public awareness.  This holistic and robust response demonstrates the Department’s unwavering dedication to fighting for justice for older Americans.

Assistant U.S. Attorneys in Utah are prosecuting the case.  The FBI is investigating the case.  Agents with Utah Adult Probation and Parole have made signification contributions to the investigation.