District of Utah

SALT LAKE CITY – Dell Schanze, age 45, of American Fork, Utah, pled guilty to using an aircraft to harass wildlife and pursuing a migratory bird in U.S. District Court in Salt Lake City Friday afternoon.  There was no plea agreement, and federal prosecutors made no concessions to Schanze as a part of his guilty plea to both counts of the Misdemeanor Information.

            U.S. District Judge Dee Benson took the plea and imposed a sentence of one year of court probation.  Schanze will forfeit an orange parasail as a substitute asset for the paraglider  involved in the illegal conduct.  Judge Benson also ordered him not to land a paraglider in a federally-designated Wilderness Area or in any area closed to motorized access by a federal agency.

            “The protection of Utah’s wildlife should be important to all of us.  Mr. Schanze used his motorized paraglider to harass an owl to the point of exhaustion and then kicked it. His actions showed utter disregard for this protected bird,” U.S. Attorney Carlie Christensen said Friday afternoon.           

            Schanze was charged in a Misdemeanor Information filed in late October following an investigation by the U.S. Fish and Wildlife Service.  Count one of the Information alleged that Schanze violated the Airborne Hunting Act by using a motorized paraglider to harass the owl during an incident in February or March of 2011.  Count two of the charging document alleged Schanze used a motorized paraglider to harass the barn owl, a violation of the Migratory Bird Treaty Act. 

            The Rocky Mountain Information Network assisted the U.S. Fish and Wildlife Service in the investigation.  The case was prosecuted by Assistant U.S. Attorneys in the Utah U.S. Attorney’s Office.

SALT LAKE CITY – Cache Valley Cancer Treatment and Research Clinic, a cancer treatment clinic located in Logan, pled guilty in U.S. District Court Tuesday afternoon to receipt of misbranded drugs and delivery for sale.  The Misdemeanor Information charging the clinic was filed March 31, 2015. The clinic is owned and operated by Dr. Ali Ben-Jacob, a resident of Utah and an oncologist.

            U.S. Magistrate Judge Dustin Pead imposed a six-month term of probation for the Clinic at Tuesday’s hearing.  The clinic also must pay a fine of $175,000 and a forfeiture money judgment of $775,000.

            According to court documents filed in the case, from about September 2009 to about September 2011, the Clinic received misbranded prescription oncology drugs from Quality Specialty Products (QSP) in Winnipeg, Manitoba, Canada. The drugs were “misbranded” because they came from a foreign drug establishment and were not listed annually with the U.S. Food and Drug Administration (FDA) by the foreign drug establishment as being manufactured for commercial distribution in the United States.  The drugs included Abraxane, Aloxi, Gemzar, Anzemet, Camptosar, Eloxatin, Faslodex, Herceptin, Mabthera, Neupogen, Taxotere, Velcade, and Zometa.

            Over the two year period, the Clinic paid in excess of $3.6 million for these prescription drugs which had not been listed by the FDA as being manufactured for commercial distribution in the United States.  Approximately one-half of these prescription drugs were reimbursed by federal government programs, including Medicare, Tricare, and the Federal Employees Health Benefits Program.  The Clinic resolved a civil claim with the Department of Justice brought on behalf of the FDA and federal government programs.

            Prosecutors say there was no evidence uncovered during the course of the investigation establishing patient harm from the use of the drugs from QSP or that the drugs were counterfeit. The Clinic stopped ordering and using the misbranded drugs before it was contacted by government investigators.

           “The doctor did not, however, advise his patients that he was using misbranded drugs obtained from a supplier outside the United States,” U.S. Attorney Carlie Christensen said today. “The FDA rules are in place to protect the safety and integrity of prescription medications used in the United States.  Prosecuting these kinds of cases minimizes the chances of patients receiving unsafe medicine and ensures that government and private insurance programs are paying for approved drugs.”

            “The FDA protects consumers by ensuring that they receive FDA-approved safe and effective drugs,” said Catherine A. Hermsen, Special Agent in Charge, Kansas City Field Office, FDA’s Office of Criminal Investigations. “We will continue to pursue individuals and corporations who place the public health at risk when they bypass this protective system.”

             The case was investigated by FDA’s Office of Criminal Investigations, with the assistance of the U.S. Department of Health and Human Services – Office of Inspector General’s Office of Investigations; the U.S. Department of Defense’s Defense Criminal Investigative Services; and the U.S. Office of Personnel Management.  In at least six related cases, QSP delivered similar unapproved, misbranded cancer treatment prescription drugs to physicians and practices in other areas in the United States. These cases were successfully prosecuted, in conjunction with FDA’s Office of Criminal Investigations.

Co-Conspirators Sentenced to 24 Months and 13 Months in Prison for Their Roles
 

SALT LAKE CITY – A former FBI special agent was sentenced today to 10 years in prison and ordered to forfeit $70,000 for soliciting and accepting bribes to obstruct a Utah federal grand jury investigation into an alleged kickback scheme involving a defense contractor, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Carlie Christensen of the District of Utah and Justice Department Inspector General Michael E. Horowitz.

“FBI agents—like all federal law enforcement—must be above reproach, but former Special Agent Lustyik sold his badge and position of public trust to the highest bidder,” said Assistant Attorney General Caldwell.  “This sentence serves as a stark reminder that no one is above the law.  Corrupt officials who break the law and breach their oaths will be prosecuted and sent to prison, even if they come from within the ranks of federal law enforcement.”

“These three defendants attempted to thwart a significant criminal investigation in Utah,” said U.S. Attorney Christensen.  “Two of these defendants were entrusted with protecting our citizens and upholding the law.  Their conduct, in particular, stands in stark contrast to the integrity and sacrifice of the men and women in our military and law enforcement ranks and their sentences today send a powerful message that no one is above the law.”

“Today’s sentencings represent important steps toward justice in this case,” said Inspector General Horowitz.  “Department of Justice employees and their associates must be held accountable when they abuse their authority and betray the public’s trust.”

Robert G. Lustyik Jr., 52, of Sleepy Hollow, New York, a 24-year veteran of the FBI, pleaded guilty to all charges in an 11-count indictment on Sept. 29, 2014.  Specifically, Lustyik pleaded guilty to conspiracy to commit bribery and obstruction, eight counts of honest services wire fraud, obstruction of a grand jury investigation and obstruction of an agency proceeding.

Lustyik’s co-defendants, Michael L. Taylor, 54, of Harvard, Massachusetts, and Johannes W. Thaler, 51, of New Fairfield, Connecticut, were also sentenced today to 24 months in prison and 13 months in prison, respectively, for their roles in this scheme.  Thaler was also ordered to forfeit $70,000, joint and several with Lustyik.  U.S. District Senior Judge Tena Campbell of the District of Utah imposed all three sentences.

Lustyik and Thaler both pleaded guilty for their involvement in a similar bribery scheme in the Southern District of New York.  Thaler was sentenced to 30 months in prison in that case, and will serve the two sentences consecutively.  Lustyik is scheduled to be sentenced on April 30, 2015, in the Southern District of New York.

According to court documents, from October 2011 to September 2012, Lustyik and Thaler conspired to use Lustyik’s official position as an FBI counterintelligence special agent to obstruct a criminal investigation into Taylor, a businessman who owned and operated American International Security Corporation.  Taylor was under investigation for allegedly paying kickbacks to obtain a series of contracts from the Department of Defense worth approximately $54 million.  Taylor promised Lustyik and Thaler that, in exchange for their help, he would provide them cash and multimillion dollar business contracts.  In an email message, Taylor told the two men, “I’ll make you guys more money than you can believe, provided they don’t think I’m a bad guy and put me in jail.”

According to court documents, Lustyik attempted to obstruct the investigation into Taylor by identifying Taylor as an official FBI confidential source in an effort to persuade the FBI, the Justice Department and the prosecutors and law enforcement agents in Utah that Taylor’s usefulness to the government outweighed the government’s interest in prosecuting him.  Indeed, Lustyik emphasized that indicting Taylor would threaten the nation’s security.  Lustyik also sought to take steps to directly intervene in the investigation by interviewing key witnesses.

According to court documents, the defendants boasted about the success of their scheme.  In one email message, Lustyik wrote to Taylor, “The rate this is going.  I will be indicted way before u ever are !!”  Lustyik wrote separately to Thaler, “I can leave [the FBI] in June.  But I’m afraid to if [Taylor] gets indicted n I’m not an agent I’m no help.  Has he mentioned giving me‐u a salary?”

Taylor admitted at his plea hearing that, as part of this conspiracy, he offered Lustyik a six-figure salary and a share of the proceeds from various multi-million dollar business deals he was pursuing.  Acknowledging this, Lustyik wrote to Taylor, “Let’s just get Utah over with and get stinking rich,” to which Taylor replied, “Getting stinking rick [sic], we are well on the way with that so I have the ball.”

The investigation was conducted by the U.S. Department of Justice Office of Inspector General.  The case was prosecuted by Deputy Chief Peter Koski and Trial Attorney Maria Lerner of the Criminal Division’s Public Integrity Section and Trial Attorney Ann Marie Blaylock of the Criminal Division’s Asset Forfeiture and Money Laundering Section.  Trial Attorney Scott Ferber of the National Security Division’s Counterespionage Section also assisted in the prosecution.

SALT LAKE CITY - Nathan Whitney Drage, age 56, a Salt Lake City attorney, was convicted of one count of conspiracy to impair and impede the IRS and three counts of willful failure to file a tax return, following a three-week trial in federal court in Salt Lake City. A jury returned the verdict late Tuesday night.

The case was investigated by special agents of IRS Investigation. The SEC and the Financial Industry Regulatory Authority (FINRA) also contributed to the case.

Evidence at trial showed that Drage and other business partners worked together to acquire vast amounts of stock and then exercise control of the stock through nominees to hide their control. Drage and others then caused thousands of shares of stock to be sold generating millions of dollars. Drage and other business partners took steps to hide and conceal from the IRS who owned the stock, who should report the stock sale, who got the money from the stock sale, and whether the stock sale resulted in a tax.

Evidence at trial showed Drage and others obtained control of public shell companies by acquiring stock in those shells through entities they controlled. Drage prepared and filed misleading and deceptive SEC filings for each of the public shells which hid and concealed his and others control of and beneficial ownership of the stock in those shells. Once control was obtained over the shell, Drage and others recruited nominees, primarily friends and acquaintances, to serve as officers or directors of those shells.

Evidence at trial showed Drage prepared corporate resolutions which facilitated the issuance of public shell stock to their controlled entities. Nominees knew nothing about the companies for which they were signing corporate resolutions. Nominees knew nothing about the financial and operational information contained in the SEC filings and simply signed the paperwork Drage prepared for them. The public shell was merged with a private company, often leaving Drage and others with free-trading shares post-merger.

Drage and others deposited more than $25 million in stock sale disbursements from brokerage accounts to 34 bank accounts in the names of controlled entities and individuals. They also made numerous transfers among the accounts. Drage and others agreed to set up these accounts, mix stock sales proceeds among them, pull from those accounts to pay for personal expenditures. They concealed from the IRS who got the money from the stock sale and whether the stock sale resulted in a tax.

Drage controlled two attorney trust accounts. For the eight years of the conspiracy, Drage commingled his stock sale proceeds with others’ stock sale proceeds. He also took money from client trust accounts, as well as other accounts, to pay for private school for his children, mortgage payments totaling $189,000, payments to his wife totaling $668,545, and payments to himself totaling $144,000 – among other expenses.

Drage also was convicted of failing to file corporate tax returns for three years. He failed to file a 2004 corporate return despite having $1,668,061 in gross reportable stock sales. He did not file a 2005 corporate return despite $2,748,633 in gross reportable stock sales. In 2006, Drage did not file a corporate return despite $26,691 in gross reportable stock sales.

U.S. District Judge David Sam set sentencing in the case for June 1, 2015, at 3 p.m. The felony count of conspiracy to impair and impede the IRS count carries a potential maximum penalty of five years in federal prison and a fine of $250,000. Willful failure to file a tax return is a misdemeanor punishable by up to a year in prison and a fine of $100,000, together with the cost of prosecution.

SALT LAKE CITY - Jon Telford McBride of Kaysville, Utah, was sentenced Monday afternoon in U.S. District Court in Salt Lake City to 27 months in prison to be followed by three years of supervised release. He also was ordered to pay $174,684 in restitution.

            McBride was convicted of three counts of tax evasion and one count of filing a false federal income tax return following a jury trial in September, Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division announced.

            “In today’s economic environment, it’s more important than ever that the American people feel confident that everyone is playing by the rules and paying the taxes they owe,” said John G. Collins, IRS Criminal Investigation Special Agent in Charge of Utah. “Taxpayers deserve our vigilance in the investigation and prosecution of those who choose to file false tax returns and try to evade paying the taxes they owe. This sentence should send a clear message; schemes to evade the payment of taxes are a violation of the federal tax laws and the consequences of such schemes can and will result in jail time.”

            The evidence at trial established that McBride prepared and filed a false individual federal income tax return for the year 2005. He failed to report approximately $109,785 in gross income that he received during the 2005 tax year. McBride also willfully attempted to evade his federal income taxes for the 2006, 2007 and 2009 tax years by failing to file an individual federal income tax return, filing a false tax return where he underreported his income by more than $300,000, and filing a false tax return that reported zero income. McBride also used several nominees to hide and conceal his ownership in property and partnerships to keep those assets out of the reach of the Internal Revenue Service (IRS).

            Acting Assistant Attorney General Ciraolo commended the special agents of IRS-Criminal Investigation, who investigated the case, and Trial Attorneys Brent Ward of the Justice Department’s Criminal Division and Andrea Kafka of the Tax Division, who prosecuted the case. Acting Assistant Attorney General Ciraolo also thanked the U.S. Attorney’s Office for the District of Utah for their substantial assistance.

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

SALT LAKE CITY - A 40-count federal indictment unsealed late Thursday afternoon in U.S. District Court in Salt Lake City charges six individuals with violations of federal law in  what the indictment alleges was a scheme to market and sell home loan modification services to distressed homeowners trying to save their homes from foreclosure following the financial crisis of 2008.  Investigators believe the alleged scheme involved more than 10,000 victims in nearly every state in the country with losses of more than $33 million.           

            Charged in the indictment are Chad Gettel, age 39, of Salt Lake City, John McCall, age 43, of Park City, Noemi Lozano aka Noemi Sayama, age 24, of San Diego, Sheridan Black, age 66, of South Jordan, James Scott Creasey, age 36, of Riverton, and Jeremiah Barrett, age 33, of Bountiful.  Charges in the indictment include conspiracy, mail fraud, wire fraud, telemarketing fraud, conspiracy to commit money laundering, and money laundering.

            "The defendants in this case allegedly represented that CC Brown was a business comprised of successful lawyers who targeted individual homeowners with the false promise of quality legal representation and legitimate loan modifications.  Their scheme allegedly took advantage of these vulnerable homeowners who were desperate to secure some financial relief and save their homes, but ended up in even deeper financial trouble.  The indictment makes clear that anyone contemplating similar crimes will be investigated and prosecuted and warns potential victims to be extremely cautious before paying fees to anyone offering financial rescue,” U.S. Attorney Carlie Christensen said today.

            The indictment alleges that the object of the conspiracy for the defendants was to market and sell loan modification services using false and fraudulent pretenses to obtain money from customers and to enrich themselves.

            According to allegations in the indictment, Gettel and Lozano started their loan modification business in July 2009 and set up CC Brown Law LLC.  They hired attorneys to create the false impression that their loan modification business was a law firm.  According to the indictment, attorneys provided little to no actual legal services for individual customers, while misrepresenting to the public that the attorneys were providing the core legal services for which the customers were paying.  In fact, the indictment alleges, non-attorney “processors” and telemarketers working for them performed most if not all of the work for customers seeking loan modifications.

            In August 2009, according to allegations in the indictment, Gettel obtained information about homeowners who were delinquent on their mortgage payments, and hired third parties, including a telemarketing center in California, to market his loan modification business to these homeowners. Telemarketers pitched CC Brown using false and misleading statements Gettel provided them, including statements that CC Brown had a 90 percent success rate in obtaining loan modifications; offering a money back guarantee on obtaining a successful loan modification; and that CC Brown’s attorneys would provide the loan modification work.

            Other misleading statements the defendants caused telemarketers to make to customers included that loan modifications typically occurred in four months; that their attorneys had over 100 years combined experience in real estate law; and that they had obtained over 6,000 successful loan modifications and averaged 300-400 successful loan modifications per month. Customers relied on these misleading and fraudulent statements in purchasing the services of the loan modification businesses, the indictment alleges. Gettel and McCall eventually instructed the telemarketers to sign up every potential customer who called regardless of whether the customer qualified for a home loan modification.

            Gettel hired McCall around January 2010.  Around April 2010, Gettel and McCall created in-house teams of telemarketers in Utah.  Black and Barrett joined CC Brown to work in the Utah telemarketing center.  Creasey joined CC Brown in early 2011.  Black, Barrett, and Creasey eventually managed or supervised the Utah-based telemarketing operation, the indictment alleges.

            Complaints to state and federal agencies in Utah and other states reflected a pattern of fraudulent conduct. Customers would go for months without knowing the status of their loan modification, and those who were already in default continued to receive letters and phone calls from the lender or debt collector.  In some instances, customers lost their homes to foreclosure while still waiting for word on their loan modification from CC Brown.

            The case is being investigated by special agents of the U.S. Treasury’s Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP); IRS Criminal Investigation; the FBI; Office of Inspector General Board of Governors of the Federal Reserve System and Consumer Financial Protection Bureau; and the Federal Housing Finance Agency-Office of Inspector General.

            “These individuals are accused of using the banner of a law firm to defraud more than 10,000 struggling homeowners residing in nearly every state out of more than $33 million. SIGTARP and our law enforcement partners are shutting down mortgage modification fraud— a reprehensible crime that preys upon struggling homeowners who are seeking help from the Home Affordable Modification Program (HAMP) because they are desperate to save their homes from foreclosure and keep a roof over their families’ heads.” said Christy Romero, Special Inspector General for the Troubled Asset Relief Program (SIGTARP).

            “Taking advantage of desperate homeowners is a deplorable act.  Fraudulent loan modification schemes, which raise false hopes with phony promises of legal representation, take advantage of struggling homeowners willing to do almost anything to save their homes.  Individuals committing loan modification fraud profit from that desperation,” Mary Rook, Special Agent in Charge of the FBI said.

           “The indictments of the individuals alleged to have committed this fraudulent loan modification scheme should serve as a continued warning to anyone contemplating this type of fraud that their actions will be fully investigated and vigorously prosecuted,” stated John G. Collins, Special Agent in Charge of Utah for IRS Criminal Investigation.

           “Along with our law enforcement partners, we are committed to ensuring that individuals who fraudulently undermine key government programs intended to support consumers of financial services are held accountable to the fullest extent of the law,” said Mark Bialek, Inspector General of the Board of Governors of the Federal Reserve System and Consumer Financial Protection Bureau.”

            “This alleged scheme was complex and callous in its attempt to prey on those in need.   Our office, along with our law enforcement partners, will continue to combat the fraud that victimizes troubled families, and Fannie Mae and Freddie Mac,” Federal Housing Finance Agency-Office of Inspector General Special Agent in Charge Barry McLaughlin stated.

            Arrests warrants were executed Thursday.  Gettel, McCall, Black, Creasey and Barrett were arrested in Utah.  An initial appearance for these defendants is set for Friday at 3 p.m. before U.S. Magistrate Judge Evelyn Furse.  Lozano was arrested in Los Angeles, where she had an initial appearance Thursday afternoon.  She was released on a $50,000 security bond and must wear an ankle monitor. She was ordered to appear in federal court in Salt Lake City on March 19.Indictments are not findings of guilt.  Individuals charged in indictments are presumed innocent unless or until proven guilty in court.

            The potential maximum penalties for the counts charged in the indictment include up to 30 years for each count of conspiracy, mail fraud and wire fraud; a term of up to 10 years for the telemarketing fraud allegation; up to 20 years for conspiracy to commit money laundering; and up to 10 years for each count of money laundering.  Gettel is charged in all 40 counts of the indictment.  McCall is charged in counts 1-5 and 7-40 (39 counts). Lozano is charged in counts 1 and 6.  Creasey is charged in count 1 and counts 14-17 (5 counts).  Barrett is charged in count 1 and counts 18-22 (6 counts) and Black is charged in count 1 and counts 23-29 (8 counts).

If you have information regarding C.C. Brown and related entities, or individuals identified in the indictment, please contact the FBI at 1-877-236-8947. Please select option 2, case update. 

For further information regarding this matter, please go online at http://www.fbi.gov/stats-services/victim_assistance/c.c.-brown-company-loan-modifications

            SALT LAKE CITY - A federal grand jury returned an indictment Wednesday afternoon charging Curtis Lynn DeYoung, age 58, of Draper, Utah, who acted as president and Chief Executive Officer of American Pensions Services (APS) with 15 counts of mail fraud. The indictment alleges DeYoung misappropriated more than $24 million from the accounts of more than 5,000 customers without their knowledge or consent.

            U.S. Attorney for Utah Carlie Christensen and FBI Special Agent in Charge Mary Rook announced the indictment this afternoon.

            APS was a Utah corporation formed around 1983. It acted as a third-party administrator for self-directed individual retirement accounts. These investments followed a self-directed account structure in accordance with the IRS code, granting beneficiaries broad discretion over investment decisions. According to the indictment, as a third-party administrator, neither APS nor DeYoung had discretionary authority or control over the APS customer funds. APS was responsible only to disburse funds as directed by the beneficiaries.

            According to the indictment, beginning in 1998 and continuing until April 2014, DeYoung devised a scheme to defraud and obtain money from APS customers through the use of false and fraudulent representations, promises, and omission of material facts. The indictment alleges DeYoung misappropriated the funds of more than 5,000 APS customers held in two of the three APS bank accounts known as the “Master Trust” accounts which comingled all APS customer cash, including cash deposited into customer IRA accounts and cash generated from customer IRA investments.

            The indictment alleges DeYoung used the misappropriated funds from the Master Trust accounts to make personal high-risk, unsecured investments. DeYoung misappropriated the money without notifying APS customers, knowing that the money did not belong to him and that he was using it for purposes not authorized by APS customers, the indictment charges.

            According to the indictment, around Oct. 31, 2009, DeYoung made a false accounting entry in APS records in the amount of $24,789,313.65 to conceal the fact that he misappropriated these funds. DeYoung continued to solicit new customers to engage APS as a third-party administrator and concealed the fact that the total cash balances in customer accounts did not equal the amount of cash available in the APS Master Trust accounts because he had misappropriated more than $24 million dollars, the indictment alleges.

            In an effort to conceal his scheme, beginning in 1998 and continuing until January 2014, DeYoung mailed false APS account statements to all APS customers that contained inflated cash balances. These inflated cash balances did not equal the amount of cash actually available in the APS Master Trust accounts. The indictment alleges DeYoung knew that APS customers would rely on these statements in determining the value of their APS accounts.

            The indictment also includes a notice of intent to seek forfeiture of a sum of money equal to the value of the proceeds of the scheme to defraud, which is approximately $24,789,313.65, upon conviction of any offense in the indictment.

            The potential maximum penalty for each count of mail fraud in the indictment is 20 years in prison and a fine of $250,000. A summons will be issued to DeYoung to appear in federal court for an arraignment.

            The case is being investigated by special agents of the FBI and prosecuted by Assistant U.S. Attorneys in the U.S. Attorney’s Office in Salt Lake City.

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

            SALT LAKE CITY - A federal grand jury returned a 10-count indictment late Wednesday afternoon charging Teri Ann Jarvis, aka Teri James, aka Teri Jaris, age 41, of Clearfield with mail and wire fraud in connection with embezzlement schemes involving two employers. She also faces one count of aggravated identify theft.

            The indictment alleges Jarvis embezzled approximately $885,657.56 from at least two employers and diverted the money for her own use.

            According to the indictment, Jarvis was an employee of Positive Power, LLC, from about October 2006 until around September 2013. Positive Power is based in Ogden and provides electrical contracting services. Jarvis’ duties at the company included assisting with the management of company bank accounts, credit cards, collectables, payables and other financial records. She was not authorized to sign checks or credit cards.

            Jarvis was an employee of Bronco Fence Company in Kaysville from about March 2014 through about October 2014. The company specializes in fence, deck, and railing construction. Jarvis’ responsibilities at Bronco Fence included assisting with the management of the office, coordinating with a merchant services company for payment processing, and making accounting entries.

            The indictment alleges that beginning around 2008 and continuing to September 2014, Jarvis devised a scheme to obtain money from her employers using a variety of means. The indictment alleges she forged Positive Power company checks made payable to herself, her mortgage company, to pay for a car loan, and to her personal credit card. According to the indictment, Jarvis attributed fictitious expenses to closed or terminated work orders to conceal her embezzlement from the company and to avoid detection.

            The indictment alleges that Jarvis used the alias Teri James in her employment application with Bronco fence to conceal her identity and avoid detection of her previous embezzlement from Positive Power.

            According to the indictment, Jarvis provided false refund information to the merchant services company used by Bronco Fence so that the merchant servicer processed the false refunds and transferred money to Jarvis’ personal bank account. The indictment alleges Jarvis offset the money she embezzled from Bronco Fence as “material expenses” in the company records.

            Jarvis altered company financial accounts to conceal her embezzlement of company funds from both of her employers.

            The indictment charges four counts of mail fraud, five counts of wire fraud, and one count of aggravated identity theft. The potential maximum penalty for each count of wire and mail fraud is 20 years in federal prison and a fine of $250,000. The aggravated identity theft count carries a mandatory minimum two-year sentence.

            A summons will be issued to Jarvis to appear in federal court in Salt Lake City on the charges in the indictment. An indictment is not a finding of guilt. Individuals charged in an indictment are presumed innocent unless or until convicted of the charges in court.

            The case is being investigated by IRS Criminal Investigation special agents, the Weber County Sheriff’s Office, and the Kaysville Police Department and prosecuted by Assistant U.S. Attorneys in the U.S. Attorney’s Office in Salt Lake City.

            SALT LAKE CITY - A Midvale, Utah, man and a Henderson, Nevada, woman were convicted by a jury late Thursday afternoon in the U.S. District Court in Salt Lake City of tax crimes, announced U.S. Attorney Carlie Christensen of the District of Utah and Principal Deputy Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division. 

            Gerrit Timmerman, of Midvale, and Carol Jean Sing, of Henderson, were convicted of conspiracy to defraud the United States related to their promotion of a tax fraud scheme.

            According to the evidence introduced at trial, between April 23, 2004, and March 5, 2007, Timmerman and Sing conspired to defraud the United States by marketing “corporations sole” as part of their scheme to evade the assessment and payment of federal income taxes.  Timmerman and Sing falsely told their clients that corporations sole were exempt from United States income tax laws, had no obligation to file tax returns and had no obligation to apply for tax exempt status.  They further claimed that individuals could render their own income non-taxable by assigning it to the corporation sole, could draw a tax-free stipend from their corporation sole, and could render property immune from Internal Revenue Service (IRS) collection activity by transferring property to the corporation sole.

            According to evidence presented at trial, Sing used Trioid International Group Inc. as a resident agent for corporations sole and other business entities for their clients.  Sing and Timmerman also utilized a website to list the tax benefits of corporations sole and to post articles about the supposed tax benefits of corporations sole.  At the same time, Timmerman was actively assisting others in evading their state and federal income tax liabilities, and recommended the corporation sole to his clients as another way to impair the IRS.  Both defendants referred customers to one another and paid each other referral fees.

            A corporation sole is a form of incorporation allowed by some states, primarily for use by religious leaders to hold title to property.  Several states, including Utah in 2004 and Nevada in 2009, have disallowed the creation of new corporations sole.  The IRS has publicized the fact that corporations sole have been abused by promoters in Revenue Ruling 2004-27, and even included corporations sole on their “dirty dozen” tax scams in 2004.

            “Individuals who enrich themselves by promoting tax avoidance schemes and assist others in evading state and federal taxes are defrauding American taxpayers,” said U.S. Attorney Christensen.  “They should expect to be prosecuted and convicted for this conduct, as this verdict demonstrates.”

            “Yesterday’s convictions send a clear message that individuals who willfully violate our nation’s tax laws through the promotion of abusive tax schemes and the creation of sham entities will be investigated and prosecuted to the fullest extent of the law,” said Principal Deputy Acting Assistant Attorney General Ciraolo.  “The Tax Division is committed to working with its law enforcement partners to disrupt and dismantle these criminal enterprises.”

            “Designing tax shelter transactions intended to conceal the true facts from the IRS isn't tax planning; it's criminal activity,” said Special Agent in Charge John G. Collins of IRS-Criminal Investigation in Utah.  “This verdict reinforces our commitment to every American taxpayer to identify and prosecute those who devise illegal tax shelters under the guise of religion or charities to assist their clients in evading their tax obligations.”

            Sentencing is scheduled for May 20.  Sing and Timmerman each face a statutory maximum sentence of five years in prison and a fine of $250,000.

            Principal Deputy Assistant Attorney General Ciraolo and U.S. Attorney Christensen commended the special agents of IRS–Criminal Investigation who investigated this case, as well as Trial Attorneys Dennis R. Kihm and Andrea A. Kafka of the Tax Division, who are prosecuting the case.

ST. GEORGE - Brenton Andrews, age 27, of St. George, pled guilty Tuesday in U.S. District Court in St. George to one count of production of child pornography.  Andrews admitted that he persuaded a child under the age of 18 to engage in sexually explicit conduct which he recorded.

            The plea agreement includes an agreed upon sentence of 25 years in federal prison.  The prison sentence will be followed by a term of supervised release of not less than 20 years.  The sentencing agreement is subject to the approval of U.S. District Judge Ted Stewart, who will impose sentencing in the case on July 7, 2015, at 10 a.m. in St. George.

            Andrews was charged with one count of production of child pornography in a Felony Information filed in December following an investigation by the St. George Police Department and U.S. Immigrations and Customs Enforcement’s Homeland Security Investigations special agents.

            According to the plea agreement, Andrews made video recordings of the child while the child was nude and produced lewd images of the child.

            As a part of the plea agreement, Andrews agreed to forfeit a laptop computer, other computer equipment, and photographs, videos and other visual depictions.

            State charges involving alleged conduct with the child are pending.

SALT LAKE CITY - Robert Samuel Stark, age 48, of West Valley City will serve a 151-month federal prison sentence for coercion and enticement of a minor for illegal sexual activity and distribution of child pornography.  U.S. District Judge Clark Waddoups imposed the sentence in federal court last week.

            As a part of a plea agreement reached with federal prosecutors, Stark admitted that in August 2013, he engaged in online communications with Victim A, a 15-year-old female.  During those communications, he requested and obtained sexually explicit images of Victim A.  He also admitted that he met with Victim A and engaged in sexual activity.

            Stark also admitted that in November 2013 and continuing into December 2013, he used the online social network Chathour to communicate with an undercover officer in Colorado who he believed to be a 14-year-old girl.  Stark admitted that he asked the undercover officer he believed to be a 14-year-old girl to send sexually explicit images to him. Stark sent sexually explicit images of Victim A to the undercover officer.

            The case started with an undercover investigation conducted by the Gilpin County Sheriff’s Office in Colorado.  The investigation led Colorado officers to Stark and a referral was made to the Unified Police Department.  The FBI also participated in the investigation. A UPD detective was able to identify the 15-year-old victim in the case.  Law enforcement officers arrested Stark at Sugarhouse Park on Dec. 13, 2013.  Stark came to the park expecting to meet Victim A and another 14-year-old girl for the purposes of engaging in illegal sexual activity.

            Stark must forfeit an iPhone, a laptop computer, and a DVD player and memory card.  Federal prosecutors sought forfeiture of the items that were used in the commission of the felony offenses.   

SALT LAKE CITY - Jacquelin Boyd, aka Jacquelyn Boyd, age 37, of West Jordan, entered a guilty plea to making a false claim to the IRS in U.S. District Court Friday afternoon.  Boyd admitted that from May 2, 2012, through about Oct. 13, 2012, she worked with others to obtain the names, addresses, social security numbers and other personal identifiers of deceased individuals and used the information to file false and fraudulent tax returns with the IRS.

            Boyd admitted that she created false records of employers, wages, and Utah addresses to submit with the returns.  She directed that the refunds, based on the fraudulent information, be deposited to various bank accounts under her control.  She withdrew the money after it was deposited in the accounts.

            She pled guilty to a count involving a false tax return filed on Oct. 13, 2012, in the name of A.B., who is deceased.  A return of $2,444 was mailed to Boyd.

“IRS Criminal Investigation, along with our law enforcement partners and the United States Attorney's Office, continue to do our part in protecting the integrity of the tax system and those individuals whose identities were stolen, as well as recovering any monetary loss against the U.S. Treasury”, stated John G. Collins, IRS Criminal Investigation Special Agent in Charge of Utah.

            The plea agreement includes a recommendation for a sentence of one year and a day, which is subject to court approval.  Boyd also agreed to pay $32,243 in restitution to the IRS.

            A scheduling hearing has been set for April 15, 2015, at 2:30 p.m., in Judge Tena Campbell’s courtroom.

SALT LAKE CITY - A Houston investment manager was sentenced late Wednesday afternoon to 56 months in prison for orchestrating a $72 million investment fraud scheme resulting in approximately $40 million in losses to investors. U.S. District Judge Robert J. Shelby imposed the sentence in federal court in Salt Lake City.

            Robert Andres, 63, of Houston, Texas, pleaded guilty on Aug. 22, 2013, to wire fraud.  In addition to the prison sentence, Judge Robert J. Shelby also ordered Andres to pay more than $3.2 million in restitution.

            Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, Acting U.S. Attorney Carlie Christensen of the District of Utah, Special Agent in Charge Mary Rook of the FBI’s Salt Lake City Field Office and Special Agent in Charge John Collins of the Internal Revenue Service-Criminal Investigation’s (IRS-CI) Las Vegas Field Office made the announcement.

            According to admissions made in connection with his guilty plea, between October 2005 and 2011, Andres recruited investors for Winsome Investment Trust, where he served as the sole manager, attorney and trustee, by misrepresenting Winsome’s assets, asset allocation and the manner in which investor funds were invested.  Indeed, between October 2005 and April 2007, Andres raised more than $39 million by disseminating false and misleading balance sheets and representing that he would invest all of the investors’ funds in a trading program or mostly automated trading business.

            Also according to Andres’ admissions, he intentionally failed to disclose to potential  investors that their money would actually be used to pay earlier investors.  In addition, Andres used new investor funds to make purported “profit” payments to earlier investors to create the false impression that Winsome was profitable.  During this period, Andres also misappropriated approximately $2.2 million in investor money for personal use, including hotel bills and living expenses.

            This case was investigated by the FBI’s Salt Lake City Field Office and IRS-CI’s Las Vegas Field Office.  The Commodity Futures Trading Commission and the Securities and Exchange Commission also provided assistance in the investigation.  The case is being prosecuted by Trial Attorney Thomas B.W. Hall of the Criminal Division’s Fraud Section and Assistant U.S. Attorneys Jason R. Burt and Mark Y. Hirata of the District of Utah.

SALT LAKE CITY - A California investment manager was sentenced late Wednesday afternoon to 225 months in prison for orchestrating a $33 million Ponzi scheme resulting in $15.2 million in losses to investors.  U.S. District Judge Robert J. Shelby imposed the sentence in federal court in Salt Lake City.

            Robert L. Holloway, 57, of San Diego, California, was found guilty on Aug. 5, 2014, after a seven-day jury trial, of four counts of wire fraud and one count of making a false income tax return.  In addition to the prison sentence, Judge Shelby also ordered Holloway to pay $15.2 million in restitution.

            Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, Acting U.S. Attorney Carlie Christensen of the District of Utah, Special Agent in Charge Mary Rook of the FBI’s Salt Lake City Field Office and Special Agent in Charge John Collins of the Internal Revenue Service-Criminal Investigation’s (IRS-CI) Las Vegas Field Office made the announcement.

            Evidence presented at trial established that Holloway served as the chief executive officer and managing partner of US Ventures LC between May 2005 and April 2007.  From October 2005 until at least April 2007, Holloway recruited investors by making false representations, including that US Ventures used proprietary trading software that was consistently profitable, that US Ventures generated returns of 0.8 percent per trading day and that US Ventures would retain a 30 percent share of investors’ profits as a management fee.

            The evidence also showed that Holloway generated and distributed reports to investors showing false daily returns on their investments.  Indeed, between October 2005 and April 2007, contrary to the returns shown on the false reports, US Ventures lost more than $10 million in trading, and the “profit” figures on the investor reports were entirely fabricated.  US Ventures raised more than $33 million from investors for its purported trading activities.

            Evidence at trial further demonstrated that Holloway and US Ventures made “profit distributions” to investors from funds solicited from new investors, and that Holloway misappropriated investors’ funds for a variety of personal expenses, including supporting his then-wife’s eBay business, and purchasing hundreds of thousands of dollars of jewelry.  During 2006 alone, Holloway diverted more than $1.2 million in investor funds to a “business” account that he used as a personal account.  During that same year, Holloway falsely claimed a gross income of only $27,500 on his personal tax return.

            The case was investigated by the FBI’s Salt Lake City Field Office and the IRS-CI’s Las Vegas Field Office.  The Commodity Futures Trading Commission and the Securities and Exchange Commission also provided assistance in the investigation.  This case was prosecuted by Trial Attorney Thomas B.W. Hall of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Jason R. Burt of the District of Utah.

SALT LAKE CITY - A Jan. 26, 2015, trial date has been set in U.S. District Court for Shawn Phillip Hansen, age 32, of Pleasant Grove, Utah, who has been charged in an indictment with stealing 42 firearms from a Federal Firearms Licensee (FFL) in Springville. Hansen was an employee of the FFL at the time the alleged thefts took place.

            Hansen was charged in a two-count indictment returned in November.  The first count of the indictment alleges that beginning on an unknown date and continuing through Sept. 24, 2014, Hansen had 42 stolen firearms in his possession.  The second count of the indictment charges him with stealing the firearms from the FFL.

            The 42 firearms include a variety of rifles, revolvers, pistols, handguns, and shotguns, including two Taurus International .410 caliber revolvers; two Winchester rifles; six Colt pistols; three U.S.A. Military Surplus .30-06 rifles; and two Browning shotguns.  The estimated value of the stolen firearms is around $100,000.

            The case came to law enforcement’s attention after the owner of the business determined that a firearm was missing from his inventory.  Further investigation identified 42 missing firearms. The case is being investigated by the Springville Police Department and special agents of the ATF.

            According to Acting U.S. Attorney Carlie Christensen, the case is being prosecuted federally as a part of the Utah Project Safe Neighborhood (PSN) initiative.  PSN, which includes partnerships between local, state and federal police officers and prosecutors, is designed to create safer neighborhoods through a sustained reduction in crime associated with gang and gun violence.

            “As the result of hard work by Springville detectives and agents from the Federal Bureau of Alcohol, Tobacco and Firearms, led by Springville Detective Jeff Ellsworth, over 40 weapons have been recovered and removed from the streets of Springville.  Removing stolen guns from the streets reduces crime in our community, makes the dealer who had the guns stolen whole, and increases the safety of our citizens.  We are pleased the U.S. Attorney’s Office is working with us to keep our communities safe,” Springville Police Chief K. Scott Finlayson said today.

            The potential maximum penalty for each count in the indictment is 10 years in prison and a fine of $250,000.  Hansen was released with conditions following an initial appearance on the charges.

            An indictment is not a finding of guilt.  Individuals charged in indictments are presumed innocent unless or until proven guilty in court.

SALT LAKE CITY - Acting U.S. Attorney Carlie Christensen announced Wednesday that the District of Utah collected $4,335,105.35 in Fiscal Year (FY) 2014 related to criminal and civil actions in the fiscal year ending Sept. 30, 2014.  Of this amount, $1,593,778.34 was collected in criminal actions and $2,741,327.01 was collected in civil actions.  The U.S. Attorney’s Office is responsible for enforcing and collecting civil and criminal debts owed to the United States and restitution owed to federal crime victims. The District of Utah also worked with other U.S. Attorneys’ offices and components of the Department of Justice to collect an additional $3,432.187.83 in cases pursued jointly with these offices.

            One of the largest collections in Utah this year came as a part of a civil settlement with Okland Construction Co., who agreed to pay the government $928,000 to resolve allegations that it made false statements and submitted false claims under the Small Business Administration’s Section 8(a) Program for Small and Disadvantaged Businesses. Okland Construction, a large construction company, entered into a mentor-protégé agreement with Saiz Construction, a participant in the 8(a) program.  The government alleged that Okland had not formed a qualifying joint venture with Saiz, and as a result, had fraudulently obtained access to contracts set aside for small businesses.

            Additionally, the U.S. Attorney’s Office in Utah, working with partner agencies and divisions, collected $11,871,702 in asset forfeiture actions in FY 2014, which is used to restore funds to crime victims and for a variety of law enforcement purposes.  The office also paid $1,650,252 in forfeited funds to crime victims for restitution and shared $566,684 with local law enforcement agencies who participated in the prosecution of federal cases. Asset forfeiture is an effective deterrent to crime and is used to disrupt and dismantle criminal organizations that attempt to profit from their unlawful activity and to restore property to crime victims.

            “Financial recoveries are a critical part of the Department’s mission to hold those who violate the law accountable for the injury they cause to crime victims and the general public.  This office takes that responsibility very seriously and will continue to aggressively pursue compensation from those who commit crimes and civil wrongs to ensure that the wrongdoers – not the public – bear the costs of unlawful conduct here in Utah,” Acting U.S. Attorney Christensen said today.

            Attorney General Eric Holder announced on Wednesday that the Justice Department collected $24.7 billion in civil and criminal actions in FY 2014. This figure represents nearly eight-and- a-half times the appropriated $2.91 billion budget for the 94 U.S. Attorneys’ offices and the main litigating divisions of the Justice Department combined in that same period.  The amount is more than three times the $8 billion collected in FY 2013.

            “Every day, the Justice Department’s federal prosecutors and trial attorneys work hard to protect our citizens, to safeguard precious taxpayer resources, and to provide a valuable return on investment to the American people,” said Attorney General Holder.  “Their diligent efforts are enabling us to achieve justice and recoup losses in virtually every sector of the U.S. economy.  And it shows the fruits of the Justice Department’s tireless work in enforcing federal laws; in protecting the American people from violent crime, national security threats, discrimination, exploitation, and abuse; and in holding financial institutions accountable for their roles in causing the 2008 financial crisis.”  

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

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

            The largest single source of collections came from civil penalties paid by financial institutions to resolve financial fraud claims stemming from the 2008 financial crisis, including significant amounts paid by JPMorgan and Citigroup Inc, to resolve federal and state civil claims related to the packaging, marketing, sale and issuance of residential mortgage-backed securities (RMBS).  Both resolutions include record penalties under the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA) and in addition, also provide billions of dollars of relief to struggling homeowners.

ST. GEORGE, UT - A Feb. 3, 2015, sentencing date has been set for Chad Eugene Devaughn, age 42, of Hurricane, Utah, after he entered guilty pleas to possession of methamphetamine with intent to distribute and possession of a firearm in furtherance of a drug trafficking offense in federal court in St. George earlier this week.  Devaughn was charged in a Felony Information filed Oct. 28, 2014.

            The plea agreement includes a stipulated sentence of 144 months, which is subject to court approval.  As a part of the plea agreement, Devaughn also agreed to forfeit property acquired from or traceable to his criminal offenses and any property that was used to facilitate his criminal conduct, including $4,500 in currency; eight firearms; and magazines and ammunition in various calibers seized with the firearms. Several of the firearms were confirmed stolen, federal prosecutors said.

            U.S. District Judge Ted Stewart will impose a sentence in the case at 10:30 a.m. Feb. 3, 2015, in federal court in St. George.

            As a part of the plea agreement, Devaughn stipulated that on about Aug. 26, 2014, he possessed methamphetamine with the intent to distribute it. Washington County Drug Task Force officers and agents executing a search warrant at his residence recovered approximately 220 grams of methamphetamine.  He also admitted that he possessed firearms, including a Kel Tec 9mm caliber handgun, in furtherance of the drug trafficking offense. Law enforcement officers recovered the firearms and methamphetamine from his residence.

SALT LAKE CITY - A federal grand jury returned an indictment Wednesday afternoon  charging Michael Alexander Bacon, age 45, of Salt Lake City, with five bank and credit union robberies in Salt Lake City, West Valley City, and North Salt Lake between Feb. 3 and March 24, 2014.

            The indictment charges Bacon with a Feb. 3, 2014, robbery of Zions Bank in North Salt Lake; a Feb. 19, 2014, robbery of Mountain America Credit Union in Salt Lake City; a March 21, 2014, robbery of  Zions Bank in West Valley City; and March 24, 2014, robberies of U.S. Bank and Chase Bank, both in Salt Lake City.

            Bacon was arrested a few days after the last two bank robberies when a Salt Lake City police officer saw the defendant at a shopping center and recognized him as the suspect from the bank robberies.  The officer approached the defendant and ordered him to stop. Bacon did not follow the command and fled on foot into a nearby store.  Officers pursued him and apprehended him.

            The potential maximum penalty for each count of bank robbery is 20 years in federal prison and a $250,000 fine.  Bacon is in state custody on other charges and is scheduled to go to trial in early December.  Federal prosecutors will schedule an initial appearance for Bacon in federal court once the state case has been resolved.  

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

SALT LAKE CITY - Acting United States Attorney Carlie Christensen announced Monday that Assistant U.S. Attorney Alicia Cook will lead the efforts of her office in connection with the Justice Department’s nationwide Election Day program for the Nov. 4, 2014, general election. AUSA Cook has been appointed to serve as Election Officer for the District of Utah. In that capacity, she will be responsible for overseeing complaints of election fraud and voting rights abuses in consultation with the Justice Department in Washington, D.C.

            "Although Utah has a history of conducting problem-free elections, we want to make sure residents of Utah know that reports of fraud or abuse will be taken seriously," Ms. Christensen said today. “Election fraud and voting rights abuses dilute the worth of votes honestly cast. They also corrupt the essence of our representative form of government. It is imperative that those who have specific information about discrimination or election fraud make that information available immediately to the U.S. Attorney’s Office, the FBI, or the Department of Justice.”

            Ms. Cook will be available Tuesday to respond to complaints of election fraud or voting rights abuses and to ensure that any complaints are directed to the right place. She can be reached by the public at 801-325-3350 while the polls are open.

            In addition, the FBI in Salt Lake City will have special agents available throughout the day to receive allegations of election fraud and other election abuses on Election Day. The FBI can be reached at 801-579-1400.

            Complaints about ballot access problems or discrimination can also be made directly to the Department of Justice’s Civil Rights Division’s Voting Section in Washington, D.C., at 1-800-253-3931 (toll free) or 202-307-2767. The Civil Rights Division staff can also be reached by TTY at 202-305-0082. In addition, individuals may also report complaints, problems, or concerns related to voting by fax to 202-307-3961, by email to voting.section@usdoj.gov, and, by complaint forms that may be submitted through a link on the Department’s website, at www.justice.gov/crt/about/vot/.

            The administration of the election process is primarily a state rather than a federal function. States have the power to establish the place, time, and manner for holding elections. The Department of Justice, however, plays an important role in deterring election fraud and discrimination at the polls. The Justice Department's Criminal and Civil Rights Divisions enforce specific federal laws that help to ensure that all qualified voters have an opportunity to cast their ballots and have them counted.

            Federal law protects against such crimes as intimidating or bribing voters, buying and selling votes, altering vote tallies, stuffing ballot boxes, and marking ballots for voters against their wishes or without their input. It also contains special protections for the rights of voters and provides that they can vote free from acts that intimidate or harass them. For example, actions of persons designed to interrupt or intimidate voters at polling places by questioning or challenging them, or by photographing or videotaping them, under the pretext that these are actions to uncover illegal voting, may violate federal voting rights laws. Further, federal law protects the right of voters to mark their own ballot or to be assisted by a person of their choice.

            Mistakes by election administrators, violations of state laws governing how elections are to be conducted, the accuracy of campaign literature, campaigning too closely to voting locations, the process by which candidates qualify for ballot status and events that occur in the course of political campaigns generally are not appropriate for federal prosecution, although such matters may violate state election laws.

            Voters with questions about where to vote should call their county clerk’s office.

            SALT LAKE CITY - Dell Schanze, age 45, of American Fork, Utah, has been charged in a two-count misdemeanor information with knowingly using an aircraft to harass wildlife and pursuing a migratory bird. The charges were filed Tuesday afternoon in U.S. District Court in Salt Lake City.

            Count one of the information alleges that Schanze violated the Airborne Hunting Act by using a motorized paraglider to harass an owl during an incident in February or March of 2011. Count two of the document alleges Schanze used his motorized paraglider to pursue a barn owl, which is a violation of the Migratory Bird Treaty Act.

            The information also includes a notice of intent by the U.S. Attorney’s Office to seek forfeiture of the motorized paraglider or substitute property or assets.

            The potential penalty for using an aircraft to harass wildlife is up to one year in jail and a fine of $100,000. The potential penalty for pursuing a migratory bird is up to six months in jail and a $5,000 fine.

            Charges included in a misdemeanor information are not findings of guilt. Individuals charged in a misdemeanor information are presumed innocent unless or until proven guilty in court.

            A summons will be issued to Schanze to appear in federal court.

            The case is being investigated by the U.S. Fish and Wildlife Service and prosecuted by the U.S. Attorney’s Office in Salt Lake City.

            SALT LAKE CITY - James Ronald Donahoo, II, age 36, of Pleasant Grove, who pled guilty to wire fraud, money laundering, and failure to file a tax return in June, will serve 48 months in federal prison. U.S. District Judge Dee Benson imposed the sentenced Thursday afternoon in U.S. District Court in Salt Lake City.

            Donahoo must serve three years of supervised release after he finishes his federal prison sentence and pay $2,739,501.17 in restitution to victims of the fraud. A forfeiture money judgment has been entered in the same amount.

            Donahoo’s convictions stem from a scheme to defraud individuals and companies he recruited to invest in Paradigm Investing, Inc., a Utah corporation he exercised control over.

            As a part of the plea agreement, Donahoo admitted that he misrepresented to investors that if they would invest in Paradigm, they would make a 1 to 3 percent return on their investment, which would be paid out monthly. Paradigm never earned any revenues on any of its purported investments from which interest payments could have been made.

            Donahoo admitted he told investors that Paradigm was in the business of making bridge loans or “hard money loans” to small businesses. According to the plea agreement, Paradigm did invest approximately $1.5 million in various businesses. However, the investments were not in bridge loans or hard money loans at Paradigm’s investors were told. Instead, businesses that received money were run by Donahoo’s friends, associates, or family members.

            He created false bank statements for Paradigm that he showed to investors to convince them that the investment was safe, low risk, and a good investment. He also told investors that the risk was mitigated by the fact that for every dollar invested, he had a dollar in the bank.

            Donahoo made payments to investors totaling more than $267,000 out of investor funds in furtherance of what was a Ponzi scheme.

            Donahoo admitted that on or about Dec. 5, 2008, he caused two investors to send a $100,000 wire transfer from California to Utah as an investment in Paradigm. On about December 11, 2008, he purchased fur coats in Park City in excess of $10,000. He admitted in the plea agreement that he knew this transaction involved money obtained from his criminal scheme.

            He also admitted that he did not file a tax return for 2008, even though he transferred funds from the Paradigm bank account to his personal bank account totaling $335,000. He used those funds for personal purposes.

            The case was investigated by special agents of IRS-Criminal Investigation and prosecuted by the U.S. Attorney’s Office in Salt Lake City.

            SALT LAKE CITY - Armand R. Franquelin, age 57, of Liberty, Utah, who pleaded guilty in May to securities fraud and money laundering in connection with an investment fraud scheme related to a real estate project in Vernal, Utah, will serve 57 months in federal prison. U.S. District Judge Dale Kimball imposed the sentence Wednesday afternoon in U.S. District Court in Salt Lake City.

            Judge Kimball also ordered Franquelin to pay restitution of $6,566.596.85 to victims of the fraud and to be on supervised release for three years when he finishes serving his prison sentence.

            Franquelin and a co-defendant, Martin A. Pool, age 44, of Atlanta, Georgia, were charged in a three-count felony information filed in April. Both pled guilty in May to securities fraud and money laundering in connection with the scheme. Pool was sentenced to 78 months in federal prison in September.

            As a part of a plea agreement reached with federal prosecutors, Pool and Franquelin admitted that from 2006 to 2010, they participated in persuading investors to convert their traditional IRAs to self-directed IRA accounts and invest their funds in a residential real estate project known as Haven Estates in Vernal, Utah. This was accomplished by inducing the investors to direct their funds to their company, The Elva Group, in return for notes promising monthly interest payments at annual rates between 8 percent and 20 percent. Pool and Franquelin admitted telling investors that their funds would be used to develop Haven Estates and promised to secure their loans with first lien positions in property at Haven Estates. In fact, no investors ever received any collateral or any interest in real property in Haven Estates or anywhere else.

            In reality, the plea agreement says, investors’ funds were used for purposes other than the development of Haven Estates. Investors were not told of encumbrances already in place on Haven Estates. When Elva began defaulting on the mortgage loan for Haven Estates, investors were not immediately informed. Eventually, Haven Estates was foreclosed.

            According to the plea agreement, investors’ funds were used by Pool and Franquelin and their associates for their personal benefit and to pay interest to earlier investors as Ponzi payments. The Ponzi payments had the effect of lulling the earlier investors, persuading them to leave their funds in the company and inducing them to renew their promissory notes from time to time. The payments also enticed new investors to invest.

            The case was a multi-jurisdictional investigation by special agents of the FBI and IRS-Criminal Investigation; the Utah Department of Commerce, Division of Securities; and the Alabama Securities Commission with assistance from the office of Baldwin County, Alabama, District Attorney Hallie S. Dixon (28th Judicial Circuit). Alabama victims of the scheme invested more than $500,000.

            Alabama Securities Commission Director Joseph Borg, said, "This Commission is proud to have joined the collaborative efforts of the federal and state law enforcement agencies and their professional staff members to see that justice is served for the victims in this important case. The outcome resulted from a team approach between the U.S. Attorney's Office in Utah, the Utah Department of Commerce's Division of Securities, the FBI, the IRS, and the ASC Enforcement and Legal Divisions to send a message that this financial crime, and others like it, will not be tolerated and will be prosecuted to the fullest extent of the law."

            “The sentencing today demonstrates that taking money from investors under false pretenses and using it for your own personal benefit as Pool did won’t be tolerated. IRS Criminal Investigation is proud to bring our forensic accounting skills to this investigation and, working side-by-side with our law enforcement partners and prosecutors, help put a stop to this and other types of white collar crime,” said John Collins, IRS Criminal Investigation Special Agent in Charge of Utah.

            SALT LAKE CITY - A former FBI special agent and a conspirator pleaded guilty in Salt Lake City yesterday and today to participating in a bribery scheme to obstruct a grand jury investigation in exchange for the promise of cash and multimillion dollar business contracts offered by a businessman under investigation.

            Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, Acting U.S. Attorney Carlie Christensen of the District of Utah and Justice Department Inspector General Michael E. Horowitz made the announcement after the guilty pleas were accepted by U.S. District Judge Tena Campbell.

            “No one is above the law, no matter what rank or badge a person might hold,” said Assistant Attorney General Caldwell. “Corruption by those entrusted to enforce the law strikes at the heart of our criminal justice system, and it will not be tolerated. This case lays bare a disgraceful attempt by a veteran FBI agent to get rich by thwarting an ongoing investigation. The Justice Department will fight corruption wherever we find it, even within the ranks of federal law enforcement.”

            “These plea agreements demonstrate that Federal law enforcement officers who sell their badges for cash and frustrate the administration of justice will be held accountable for their actions,” said Inspector General Horowitz. “Department employees are held to the highest standards, and we cannot permit our criminal justice system to be stained by such bribery and corruption.”

            “When a law enforcement officer violates his oath and the public’s trust by breaking the law, he must be held accountable,” said Acting U.S. Attorney Christensen. “In this case, former Agent Lustyik’s decision to enter into a conspiracy to obstruct a significant fraud investigation in Utah is a troubling reminder that corruption may exist even among those we entrust with protecting our citizens and upholding our laws.”

            A 24-year veteran of the FBI, Robert Lustyik Jr., 51, of Sleepy Hollow, New York, pleaded guilty on Sept. 30, 2014, to an 11-count indictment charging him with conspiracy, eight counts of honest services wire fraud, obstruction of a grand jury proceeding, and obstruction of an agency proceeding. A childhood friend of Lustyik, Johannes Thaler, 50, of New Fairfield, Connecticut, pleaded guilty today to conspiracy to commit bribery, obstruction of a grand jury proceeding and obstruction of an agency proceeding. Sentencing is scheduled for Jan. 5, 2015.

            In court documents and at the plea hearings, Lustyik and Thaler admitted that from October 2011 to September 2012, Lustyik, while employed as an FBI counterintelligence special agent, and Thaler conspired to use Lustyik’s official position to obstruct a criminal investigation into Michael Taylor, a businessman who owned and operated American International Security Corporation and was under investigation for paying kickbacks to obtain a series of contracts from the Department of Defense worth approximately $54 million. Taylor promised Lustyik and Thaler that in exchange for their help, he would provide them cash and multimillion dollar business contracts. Taylor told the two men: “I’ll make you guys more money than you can believe, provided they don’t think I’m a bad guy and put me in jail.”

            Court documents state that Lustyik attempted to obstruct the investigation into Taylor by opening Taylor as an official FBI source in an effort to persuade the FBI, the Justice Department and the prosecutors and law enforcement agents investigating Taylor that Taylor’s usefulness as a source outweighed the government’s interest in prosecuting him. Lustyik also advocated on Taylor’s behalf directly to the prosecutors and law enforcement agents, urging them to use Taylor as a cooperating witness and emphasizing that indicting Taylor would threaten the nation’s security.

            According to court documents, while Lustyik was obstructing the investigation into Taylor, Lustyik suggested that Thaler “blatantly” ask Taylor for money, emphasizing “he knows we are keeping him outta jail.” Lustyik explained to Thaler that on his upcoming trip to meet Taylor in Lebanon, “Taylor is gonna hand you cash in Lebanon,” “[l]ike 150 gs.” When Thaler asked Lustyik how he was supposed to bring that much cash back to the United States, Lustyik instructed him “[i]n your pants. Or wire it? They won’t stop 2 white guys at customs without a reason, [o]r I meet you at customs at JFK and cred you in.”

            Court records state that during the conspiracy, Lustyik and Thaler acknowledged that Taylor was probably guilty, but they boasted about their success in using Lustyik’s official position to obstruct the investigation into Taylor, with Lustyik texting Thaler, “at this point IF he is indicted there is NO WAY he gets convicted even though he Prob did it.” During the conspiracy, Lustyik texted Thaler, “I think we are rich by Christmas!!” When Thaler asked why, Lustyik responded, “he [Taylor] is gonna be free!!!!!!!!”

            Taylor pleaded guilty in the District of Utah to honest services wire fraud for his role in the scheme on Nov. 27, 2013. He is scheduled for sentencing on Jan. 5, 2015.

            The investigation was conducted by Assistant Special Agent in Charge Tom Hopkins of the U.S. Department of Justice Office of Inspector General. The case is being prosecuted by Deputy Chief Peter Koski and Trial Attorney Maria Lerner of the Criminal Division’s Public Integrity Section, and Trial Attorney Ann Marie Blaylock of the Criminal Division’s Asset Forfeiture and Money Laundering Section. Scott Ferber of the Counterespionage Section of the National Security Division also assisted in the prosecution.

            SALT LAKE CITY - Robert Keller, 70, of Hurricane, pleaded guilty to a federal civil rights crime Tuesday morning in federal court in Salt Lake City. Keller was charged with interfering with the housing rights of three members of an interracial family because of the family member’s races and because the family members were living in a home in Hurricane, Utah.

            During the plea proceedings, Keller admitted that on Dec. 30, 2013, he wrote a note to two Caucasian family members of an interracial family threatening to kill them if they did not make their African American family member leave their home. Keller admitted that he used threats of force to willfully intimidate and interfere with the two Caucasian family members because they were occupying a dwelling while associating with their African American family member.

            “Members of our community have a constitutional right to live in their home without fear, and the Department will not tolerate threats of violence that infringe on that right,” said Acting Assistant Attorney General Molly Moran for the Civil Rights Division.

            “Hate based crimes have no place in America. They not only hurt the individuals who are the object of such hate, but tear at the fabric of our society as a whole. In this case, the defendant’s attempt to rid his neighborhood of an African American member of an interracial family serves as a horrifying reminder that racial intolerance stills exists in some communities. This conviction sends a clear message that such despicable acts will not be tolerated by this office, but will be prosecuted to the fullest extent of the law,” Acting U.S. Attorney for Utah Carlie Christensen said.

            Keller faces a maximum penalty of one year in prison for the conviction. Sentencing has been set for Dec. 1, 2014, at 8:30 a.m. before U.S. Magistrate Judge Evelyn Furse.

            This case is being investigated by the Salt Lake City Division of the Federal Bureau of Investigation in cooperation with the Hurricane City Police Department. It is being prosecuted by Trial Attorney Saeed Mody of the Civil Rights Division and Assistant United States Attorney Carlos Esqueda of the U.S. Attorney’s Office in Salt Lake City.

            SALT LAKE CITY - James Hector Alcala, age 46, a Salt Lake City attorney, will serve 56 months in federal prison after pleading guilty to one count of conspiracy to commit visa fraud and alien smuggling and one count of visa fraud. U.S. District Judge Dee Benson accepted the guilty plea and imposed the prison sentence at a hearing in U.S. District Court Thursday afternoon.

            Alcala was indicted in July 2009 along with a Salt Lake City law firm, a property management company, and seven other individuals. The 17-count indictment alleged that the defendants intended to profit financially by assisting Utah employers in obtaining H-2B visas for their foreign national workers by fraudulently representing to federal agencies that the foreign nationals were eligible for visas when, in fact, they were not.

            The H-2B visa program allows United States companies to hire foreign nationals to fill employee vacancies that the company, for one reason or another, cannot fill with U.S. citizens. The visa program is not intended for permanent work. It is designed to help U.S. businesses that have temporary, seasonal, peak load or intermittent needs. Several federal agencies are involved in what is a fairly complicated application process.

            As a part of court records filed today, Alcala admitted that he conspired with co-defendants in the case to fraudulently obtain H-2B visas for foreign national workers that were already living and working in the United States, in violation of the law. He admitted that he counseled illegal alien workers seeking visas to make false statements to the Department of State and the Department of Homeland Security regarding whether or not the applicants had ever lived or worked in the United States.

            Alcala also admitted that he made false representations to the Department of State, the Department of Labor, and the Department of Homeland Security on behalf of his petitioning corporate clients that were seeking H-2B visas for their businesses. The false representations included inflating the number of visas needed by the businesses; whether or not these positions could not reasonably be filled with qualified applicants that were lawfully able to work in the United States; and false statements regarding the fact that some of these workers were already living and working in the United States for the same businesses that were petitioning for the visas.

            “The laws that govern the issuance of visas exist to make the process fair for everyone. When false statements are used in an attempt to get a visa, other workers, including foreign nationals and U.S. workers and employers, who have played by the rules, get hurt,” Acting U.S. Attorney Carlie Christensen said today.

            “Alcala’s end run around immigration law, while profitable for a time, has ultimately landed him prison. His scheme unfortunately came at the cost of an untold number of legal job seekers during one of the worst economic downturns in history.” Jonathan Lines, Assistant Special Agent in Charge of Homeland Security Investigations in Utah, said. “Alcala provided an illegal solution for Utah businesses that relied on an illegal workforce.”

            David Zebley, Special Agent in Charge of the San Francisco Field Office of the U.S. State Department Diplomatic Security Service, said, “This is a great success in Department of State Diplomatic Security Service’s combined efforts in combatting large scale fraud and human smuggling as well ensuring the integrity of our travel documents. This case is an especially serious abuse of the legal and immigration systems, as it involved a criminal network consisting of eight individuals to include an officer of the court, a former Border Patrol agent and a former consular employee at the U.S. Consulate in Ciudad Juarez, Mexico. Our partnership with the U.S. Attorney’s Office, Homeland Security Investigations and the Department of Labor has thwarted a substantial attempt to compromise the safeguards on which the law-abiding rely.”

            Two defendants in the case, Carlos Manuel Vorher and Andrew Lorenzo Acosta Parra, are awaiting sentencing. Federal prosecutors believe one defendant, Carlos Enrique Gomez-Alvarez, fled to Venezuela. Two other co-conspirators, Olga Adriana Garza Muniz and Florentino Jose Ayala Villarreal, are in Mexico and have not been located. Prosecutors earlier dismissed charges against Daniel Trigo Villavicencio and Gustavo Ballesteros-Munoz.

            Janet Alcala, president, agent, and legal representative of Westside Property Management, pled guilty to visa fraud. As a part of resolution of the charges against the property management company, Janet Alcala and Westside Property Management agreed to forfeit interest in property that was traceable to, derived from, or a substitute for property that that was purchased with the proceeds of the crime. Real property, structures, homes, or buildings at nine addresses in Salt Lake City were included in the forfeited property totaling about $1 million.

            The case was investigated by special agents of the U.S. Department of State’s Diplomatic Security Service, the U.S. Department of Homeland Security, and the U.S. Department of Labor. It has been prosecuted by the U.S. Attorney’s Office in Salt Lake City.

            SALT LAKE CITY - A federal grand jury returned a 38-count indictment Wednesday afternoon charging Randy Olshen, age 51, of Newport Beach, Calif., with mail fraud, wire fraud, and money laundering in connection with a scheme involving sports hydration drinks. At times relevant to the indictment, Olshen maintained a residence in Summit County, Utah.

            The indictment alleges Olshen solicited and received more than $7 million from 50 or more victims as a part of his scheme.

            According to the indictment, Olshen was one of the founders and president of an entity known as Innovative Health Solutions, LLC (IHS), organized in 2008. IHS specialized in manufacturing and selling sports hydration drinks designed to boost energy and stamina. One of the products marketed by the company was H2O Overdrive. The indictment alleges that Olshen, in an effort to promote the growth of IHS, sought investors and made representations to encourage investments in the company.

            The indictment alleges that beginning around 2009 and continuing until about February 2013, Olshen devised a scheme to defraud IHS investors and divert portions of the invested funds for purposes not disclosed to investors in a manner inconsistent with his representations and promises. According to the indictment, Olshen misrepresented annual sales figures for the company. For example, according to the indictment, he represented that IHS had approximately $1.1 million in sales in 2009, when in fact, it had approximately $98,275 in sales in 2009. He represented that IHS had more than $28 million in sales in 2012, when in fact, it had approximately $579,239 in sales in 2012. He also represented that the company had large receivable accounts with various national chains such as Costco, Rite Aid, CVS, and Food Lion. In fact, no such large receivable accounts were owed to IHS.

            According to the indictment, Olshen concealed material facts, including that he created two sets of IHS accounting records, one that accurately represented company finances and one that was provided to investors and potential investors; fabricated paperwork, such as sales records, to support his misrepresentations regarding the growth of IHS; failed to make numerous payments to creditors; paid a portion of investor funds to others as commissions for obtaining investments for IHS; that he personally declared Chapter 7 bankruptcy around October 18, 2011; and that he used IHS funds for his own personal benefit and expenses in excess of his reported salary.

            The indictment alleges 12 counts of mail fraud, nine counts of wire fraud and 17 counts of money laundering. The potential maximum penalty for each count of mail fraud and wire fraud is 20 years with fines of $250,000. Counts 22 through 34 of money laundering have potential 20 year penalties and $500,000 penalties. Counts 35-38 of money laundering have potential 10 year sentences and fines of $250,000. A summons has been issued to the defendant to make an initial appearance on the charges Oct. 22, 2014, at 11:15 a.m. before U.S. Magistrate Judge Paul M. Warner.

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

            The case is being investigated by special agents of the FBI, IRS Criminal Investigation, and the Utah Division of Securities. It is being prosecuted by the U.S. Attorney’s Office in Salt Lake City.

            SALT LAKE CITY - A two-count misdemeanor information filed in federal court Wednesday morning in Salt Lake City charges five individuals in connection with an unlawful ATV ride in Recapture Canyon on May 10, 2014. The information alleges one count of conspiracy to operate off-road vehicles on public lands closed to off-road vehicles and one count of operation of off-road vehicles on public lands closed to off-road vehicles.

            Charged in the information are Phillip Kay Lyman, age 50, of Blanding; Monte Jerome Wells, age 50, of Monticello; Jay Demar Redd, age 40, of Santa Clara; Shane Morris Marian, age 33, of Monticello; and Franklin Trent Holliday, age 31, of Blanding. A summons will be issued to the five to appear in federal court in Salt Lake City on Oct. 17, 2014, at 2 p.m., before U.S. Magistrate Judge Evelyn Furse. Each count in the information carries a potential penalty of up to a year in jail and a fine of $100,000. The investigation in the case is ongoing.

            The information charges the five individuals with conspiracy to operate off-road vehicles on public lands closed to off-road vehicles. According to the information, from about Feb. 27, 2014, and continuing until about May 10, 2014, the defendants conspired among themselves, with each other, and with others known and unknown to operate off-road vehicles through land restricted to off-road vehicles and administered by the BLM. The information alleges the purpose of the conspiracy was to unlawfully operate off-road vehicles through the restricted area as a means of expressing opposition to the BLM and its management of Recapture Canyon.

            “We respect the fact that the citizens of this State have differing and deeply held views regarding the management and use of Recapture Canyon, and recognize that they have the right to express those opinions freely. Nevertheless, those rights must be exercised in a lawful manner and when individuals choose to violate the law, rather than engage in lawful protest, we will seek to hold those individuals accountable under the law,” Acting U.S. Attorney Carlie Christensen said today.

            “Regrettably, a number of individuals organized and engaged in an illegal ATV ride through Recapture Canyon, an area rich in archaeological history” said BLM Director Neil Kornze. “Today’s actions by the U.S. Attorney’s Office underscore the importance of protecting culturally significant areas and holding accountable those who broke the law.”

            Count one of the information alleges that beginning on or about March 2, 2104, Lyman began advertising the proposed ATV ride through the restricted area to occur on May 8, 2014, through social media. It was further part of the conspiracy, the information alleges, that on April 11, 2014, Lyman advertised the proposed ATV ride through the restricted area of Recapture Canyon by publishing an article in the Deseret News. The information alleges Lyman further promoted the published article using social media. Later in April, according to the information, Lyman, using social media, began advertising a change in the date for the proposed ATV ride from May 8, 2014, to May 10, 2014, to allow more people to participate.

            The information alleges that in late April, Lyman and Wells used social media websites to publish and promote an invitation, with accompanying instructions, to the public to join the proposed ATV ride through the off-road vehicle restricted area in Recapture Canyon on May 10, 2014.

            Around May 5, 2014, Lyman and Wells filmed a three-part video interview in which they discussed the nature, origin, and plans for the proposed ATV ride through the off-road vehicle restricted area in Recapture Canyon. It was further part of the conspiracy, according to the information, that Lyman and Wells used various social media websites to advertise and promote the proposed ATV ride.

            According to the information, Lyman and Redd spoke to a large gathering of people at a meeting in Blanding the morning of May 10, 2014, before the ride, instructing and encouraging the group assembled regarding the proposed ATV ride.

            The information alleges each defendant committed an overt act in furtherance of the conspiracy by knowingly and willfully operating an off-road vehicle through the restricted area of Recapture Canyon on May 10, 2014.

            Count two of the information alleges the five defendants operated an off-road vehicle through land closed to off-road vehicles and administered by the Bureau of Land Management and did aid and abet each other.

            An information is not a finding of guilt. Individuals charged in an information are presumed innocent unless or until proven guilty in court.

            Recapture Canyon is federal public land managed by the Bureau of Land Management. Recapture Canyon contains unique archaeological resources, including ancient rock art and dwellings that are culturally significant and irreplaceable. According to the BLM, the archaeological record left behind shows that the area was previously occupied for at least 2,000 years. For this reason, Recapture Canyon was closed to motorized use in 2007 but remains open to the public for walking, hiking and horseback riding.

            There are more than 2,800 miles of OHV trails administered by the BLM in southeast Utah that are open to public use. The BLM will continue to work with all stakeholders to address the various uses of public lands, including the development of new OHV trails.

            SALT LAKE CITY - Martin A. Pool, age 44, of Atlanta, Georgia, who pleaded guilty in May to securities fraud and money laundering in connection with an investment fraud scheme related to a real estate project in Vernal, Utah, will serve 78 months in federal prison. Pool also must pay restitution of $8,066,596.88. U.S. District Judge Dale Kimball imposed the sentence Wednesday afternoon in U.S. District Court in Salt Lake City.

            Pool will self-surrender to begin serving his federal sentence on Dec. 1, 2014.

            Pool and a co-defendant, Armand R. Franquelin, age 57, of Liberty, Utah, were charged in a three-count felony information filed in April. As a part of a plea agreement reached with federal prosecutors, Pool and Franquelin admitted that from 2006 to 2010, they participated in persuading investors to convert their traditional IRAs to self-directed IRA accounts and invest their funds in a residential real estate project known as Haven Estates in Vernal, Utah. This was accomplished by inducing the investors to direct their funds to their company, The Elva Group, in return for promissory notes from Elva with a promise of monthly interest payments at annual rates between 8 percent and 20 percent. Pool and Franquelin admitted they told investors that their funds would be used to develop Haven Estates and promised to secure their loans with first lien positions in property at Haven Estates. In fact, no investors ever received any collateral or any interest in real property in Haven Estates or anywhere else.

            In reality, the plea agreement says, investors’ funds were used for purposes other than the development of Haven Estates. Investors were not told of encumbrances already in place on Haven Estates. When Elva began defaulting on the mortgage loan for Haven Estates, investors were not immediately informed. Eventually, Haven Estates was foreclosed.

            Pool and Franquelin admitted that these actions were taken in connection with the investors’ purchase of securities, namely the promissory notes and loan agreements. They also admitted that these representations were made for the purpose of defrauding investors.

            According to the plea agreement, investors’ funds were used by Pool and Franquelin and their associates for their personal benefit and to pay interest to earlier investors as Ponzi payments. The Ponzi payments had the effect of lulling the earlier investors, persuading them to leave their funds in the company and inducing them to renew their promissory notes from time to time. The payments also enticed new investors to invest.

            Pool and Franquelin each pled guilty to one count of securities fraud and one count of money laundering. Sentencing for Franquelin is set for Sept. 22, 2014, at 2:30 p.m. before Judge Kimball.

            As a part of the plea agreement, Pool and Franquelin agreed to pay restitution of $$8,066,596.88 to victims of the fraud, including victims of uncharged relevant conduct. Alabama victims invested more than $500,000 in this scheme.

            “The U.S. Attorney’s Office in Utah has a long standing commitment to aggressively prosecuting fraudsters who target residents of our state and others around the country. These successful prosecutions serve as a deterrent to this criminal conduct. Most importantly, however, they vindicate the rights of victims who are harmed by the conduct of those involved in fraudulent schemes,” Acting U.S. Attorney for Utah Carlie Christensen said today.

            The case was a multi-jurisdictional investigation by special agents of the FBI and IRS-Criminal Investigation; the Utah Department of Commerce, Division of Securities; and the Alabama Securities Commission with assistance from the office of Baldwin County, Alabama, District Attorney Hallie S. Dixon (28th Judicial Circuit). Alabama victims of the scheme invested more than $500,000.

            Alabama Securities Commission Director Joseph Borg, said, "This Commission is proud to have joined the collaborative efforts of the federal and state law enforcement agencies and their professional staff members to see that justice is served for the victims in this important case. The outcome resulted from a team approach between the U.S. Attorney's Office in Utah, the Utah Department of Commerce's Division of Securities, the FBI, the IRS, and the ASC Enforcement and Legal Divisions to send a message that this financial crime, and others like it, will not be tolerated and will be prosecuted to the fullest extent of the law."

            “This sentence demonstrates that taking money from investors under false pretenses and using it for your own personal benefit as Pool did won’t be tolerated. IRS Criminal Investigation is proud to bring our forensic accounting skills to this investigation and, working side-by-side with our law enforcement partners and prosecutors, help put a stop to this and other types of white collar crime,” said John Collins, IRS Criminal Investigation Special Agent in Charge of Utah.

            SALT LAKE CITY – Grand America Hotels and Resorts will forfeit nearly $2 million for violations relating to the hiring of undocumented workers, including illegal aliens, according to a non-prosecution agreement signed last week by the corporation, the U.S. Attorney for the District of Utah and U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI).

            The Wyoming corporation owns, through various subsidiaries, hotel and resort properties in Utah, Wyoming, Arizona, California, and Idaho.

            According to a Statement of Facts included as an exhibit in the agreement, an administrative audit was initiated by HSI at The Grand America Hotel in September 2010. The audit was completed a year later. The audit revealed 133 undocumented individuals were working at The Grand America. All of the identified employees were hired before The Grand America began participating in the E-verify program. The hotel was issued a warning notice and the undocumented workers were terminated.

            Prior to the conclusion of the audit, without the knowledge or consent of top executives at the Hotel, lower level and mid-level managers created two nominee temporary employment agencies for the purpose of rehiring some of the terminated employees at The Grand America Hotel. Within days of the HSI warning, approximately 30 of the undocumented workers returned to work at The Grand America Hotel through these two temporary agencies. In October 2011, a third nominee temporary agency was formed to allow about a dozen more undocumented workers to work at The Grand America Hotel. In total, 43 undocumented workers returned to their jobs at the hotel through these three temporary agencies. Most returned using different names and utilizing fraudulent documents.

            Search warrants were executed in September 2012 at The Grand America Hotel, the Little America Hotel in Salt Lake City, and a company affiliated with Grand America Hotels and Resorts that held electronic records belonging to the company, as well as two residences in the Salt Lake valley which served as the centers of operation for the three temporary agencies.

            According to the Statement of Facts in the non-prosecution agreement, after the search warrants were executed, owners and senior executives of Grand America Hotels and Resorts became aware of the use of the temporary agencies and cooperated with HSI and the U.S. Attorney’s Office to uncover the full extent of the illegal conduct. Grand America also conducted an internal investigation and disclosed its findings to the U.S. Attorney’s Office and HSI.

            As a result of the investigation, The Grand America Hotel terminated three operational managers at The Grand America Hotel and one operational manager at the Little America Hotel in Salt Lake City and reprimanded two others. The undocumented workers hired through the outside agencies were not allowed to continue to work at the hotel.

            Grand America Hotel and Resorts will not be prosecuted in exchange for its continued full cooperation with HSI's investigation and action the corporation is taking to correct its hiring practices. However, because of the alleged criminal conduct attributable to its employees who were acting on behalf of Grand America, Grand America Hotels and Resorts has agreed to forfeit $1,950,000 to the Department of Homeland Security. The amount of the forfeiture was determined by looking at the total number of illegal aliens employed over the entire period of the investigation and determining the benefit gained by the corporation as a result of employing undocumented workers during that period.

            The corporation also is required to take substantial remedial measures, which are expected to cost around $500,000 to implement. Those measures include adopting new policies to comply with immigration law; incorporating immigration law compliance clauses into labor service contracts; re-training human resources employees on I-9 procedures; and agreeing to continue to use the E-Verify employment eligibility verification website. In addition, the company has agreed to retain immigration and corporate counsel to advise the company regarding hiring and immigration procedures. Grand America will continue to cooperate with HSI on future immigration-based compliance programs to ensure that the company continues to maintain a lawful workforce.

            Acting U.S. Attorney for Utah Carlie Christensen said the non-prosecution agreement reached with Grand America Hotels and Resorts represents a negotiated agreement not to prosecute the corporation. “We don’t believe there is evidence of corporate involvement in the efforts to set up the temporary employment agencies and the rehiring of the undocumented workers. Those individuals who participated in criminal activity will be prosecuted for their conduct,” Christensen said. “The forfeited sum of $1,950,000 is an appropriate resolution for the corporate entity given the violations committed by employees acting on its behalf.”

            "All industries, regardless of size, location and type are expected to comply with the law," said Kumar Kibble, special agent in charge of HSI Denver, which oversees Utah investigations. "As this significant settlement demonstrates, there are real consequences for businesses that employ an illegal workforce."

            This settlement comes as a result of an I-9 employee verification form audit and subsequent criminal investigation into unlawful hiring practices conducted by HSI. Employers are required by the Immigration Reform and Control Act to maintain for inspection original I-9 forms for all current employees. In the case of former employees, retention of forms is required for a period of at least three years from the date of hire or for one-year after the employee is no longer employed, whichever is longer. HSI conducts these audits in an effort to protect employment opportunities for the nation's lawful workforce and to target businesses that knowingly employ unauthorized workers.

WASHINGTON, D.C. – An Assistant U.S. Attorney from Utah was one of 243 employees of the U.S. Department of Justice recognized by Attorney General Eric Holder and Executive Office for U.S. Attorneys (EOUSA) Director Monty Wilkinson at a ceremony in Washington, D.C., Wednesday morning.

           Andrew Choate, who worked full-time as a Special Assistant U.S. Attorney in the U.S. Attorney’s Office from 2010 through June of this year while employed by the U.S. Department of Homeland Security, received an award for Superior Performance as a Special Assistant U.S. Attorney at the 30th annual Director’s Awards Ceremony.

           The U.S. Attorney’s Office in Utah was one of 44 offices from around the nation represented at the ceremony which was held in the Great Hall at the Robert F. Kennedy Department of Justice Building.

           In his prepared remarks to awardees, Attorney General Holder said, “Locally, nationally, and internationally, you represent the very best that this Department has to offer. Your work embodies our ongoing commitment – not merely to win cases, but to do justice; to protect our fellow citizens from crime, violence, and terrorism; to empower the most vulnerable among us; and to uphold the rule of law.”

           EOUSA Director Monty Wilkinson echoed those sentiments, saying to the recipients, “You have persevered, and remained focused and motivated – achieving remarkable results in work that makes a difference in the lives of citizens across our great country. The vast scope of your collective accomplishments is nothing short of exceptional.”

           Choate is the coordinator of the Immigration Crimes Unit in the U.S. Attorney’s Office. The office prosecutes hundreds of cases each year involving illegal aliens who have re-entered the United States after previous deportations and have been involved in new criminal conduct. Choate also coordinates efforts in the office to partner with local agencies in investigating and prosecuting human trafficking cases.

           In June of this year, Choate was hired by the U.S. Attorney’s Office as an Assistant U.S. Attorney. He will continue working in the same general areas of immigration and human trafficking while taking on other issues as a member of the office’s National Security Section.

           “During his tenure as a Special Assistant U.S. Attorney, Mr. Choate demonstrated his commitment to protecting Utah communities from violent criminals, worked with vulnerable victims of human trafficking cases, and has been willing to take on any other pressing needs in the office. He became a valuable, productive member of our office during his term as a Special Assistant U.S. Attorney and we are pleased that his hard work has been recognized by the Department of Justice,” Acting U.S. Attorney Carlie Christensen said today.

           EOUSA provides oversight, general executive assistance, and direction to the 94 United States Attorneys’ offices around the country. For more information on EOUSA and its mission, visit http://www.justice.gov/usao.

            SALT LAKE CITY - Two Salt Lake City residents were sentenced to federal prison Friday afternoon for their roles in an ongoing scheme to fraudulently obtain oxycodone from local pharmacies. The fraud scheme resulted in the distribution of thousands of 30 mg tablets of oxycodone.

            Shannon Shuman, age 44, will serve 84 months in federal prison and James Sullivan, age 36, will serve 72 months. Both will be on supervised release for 36 months when they complete their federal prison sentences. U.S. District Judge Robert J. Shelby imposed the sentences.

            According to court records, Shuman admitted that between Jan. 30, 2012, and June 19, 2012, she prepared forged prescriptions for oxycodone which carried the names of fictitious persons. She then provided the prescriptions to other people who presented the forged prescriptions at pharmacies in Utah. Shuman admitted that she received cash or oxycodone pills in payment for the forged prescriptions. The prescriptions she directly participated in corresponded to at least 4,950 tablets of 30 mg oxycodone.

            Sullivan admitted that he received forged prescriptions from Shuman and provided the prescriptions to runners who took the forged prescriptions to pharmacies and returned the pills back to him. He admitted he distributed some of the pills to others. Sullivan admitted that the prescriptions he directly participated in corresponded to 4,500 tablets of 30 mg oxycodone.

            The convictions follow investigations by the Davis County Narcotics Strike Force and the DEA.

            According to a sentencing memorandum filed by the U.S. Attorney’s Office, investigators uncovered 60 forged prescriptions corresponding to 9,270 oxycodone tablets in the Davis County investigation. During the investigation, agents identified at least 25 different runners who presented the forged prescriptions to pharmacies. On several occasions, Shuman accompanied the runners to the pharmacies. During the investigation, agents worked with an informant to purchase four forged prescriptions from Shuman. Each prescription related to 120 30-mg tablets.

            During the DEA investigation, forged prescriptions totaling 7,080 oxycodone prescriptions were uncovered along with 27 different runners. Runners received cash or drugs in exchange for their labor. Many of the runners cooperated with investigators in the case.

            Assistant U.S. Attorney Robert Lund, chief of the Narcotics Section in the U.S. Attorney’s Office, argued in a sentencing memorandum that given the serious nature of the oxycodone epidemic and the conduct involved in the fraudulent prescription scheme, the defendants should receive a federal prison sentence that “would account for the serious nature of the crime, promote respect for the law, and provide a deterrent effect to criminal conduct.”

SALT LAKE CITY - A California investment manager was found guilty in federal court in Salt Lake City, Utah, late Tuesday afternoon for his role in a $33 million investment fraud scheme.

            Robert L. Holloway, 55, was found guilty after a seven-day trial by a federal jury in the District of Utah of four counts of wire fraud and one count of making and subscribing a false income tax return.

            Evidence presented at trial established that Holloway operated an investment entity called US Ventures LC, which was founded in 1999. Holloway served as the chief executive officer and managing partner of US Ventures. From October 2005 until at least April 2007, Holloway recruited investors for US Ventures by making false representations about the company, including that US Ventures used proprietary trading software that was consistently profitable, US Ventures generated returns of 0.8 percent per trading day and US Ventures would retain a 30 percent share of investors’ profits as a management fee.

            Additionally, during the course of US Ventures’ existence, Holloway generated and distributed reports to investors showing false daily returns on their investments. The evidence introduced at trial showed that between October 2005 and April 2007, contrary to the returns shown on the reports Holloway distributed, US Ventures in fact lost more than $10 million in trading and the “profit” figures on the investor reports were entirely fabricated. Holloway and US Ventures also made “profit distributions” to investors that consisted of funds solicited from new investors, not actual profits. US Ventures raised more than $33 million from investors for its trading activities.

            Evidence at trial also showed that Holloway misappropriated investors’ funds for a variety of personal expenses, including supporting his then-wife’s eBay business and purchasing hundreds of thousands of dollars of jewelry. During 2006 alone, Holloway diverted more than $1.2 million in investor funds to a “business” account that Holloway used for as a personal account, despite the fact that he falsely claimed a gross income of only $27,500 on his personal tax return for 2006.

            U.S. District Court Judge Robert J. Shelby, who presided over the trial, set sentencing for October 20, 2014. Judge Shelby ordered Holloway to be taken into custody following the jury verdict.

            The case was investigated by the FBI’s Salt Lake City Field Office and the IRS-CI’s Las Vegas Field Office. This case was prosecuted by Assistant U.S. Attorney Jason R. Burt from the U.S. Attorney’s Office in Utah and Trial Attorney Thomas B.W. Hall of the Criminal Division’s Fraud Section. The department thanks the Commodity Futures Trading Commission and the Securities and Exchange Commission for their assistance.

SALT LAKE CITY - Jon Robertson of Bountiful pled guilty to one count of filing a false tax return in U.S. District Court in Salt Lake City Monday afternoon. U.S. District Judge Clark Waddoups accepted the plea and imposed a sentence of one year and a day.

            From 2002 until 2004, Robertson was employed by Infinia, Inc., as its president and had control over the day-to-day operations of the company. Infinia was a Utah-based company that operated nursing homes in several states around the country. Infinia was a closely-held corporation that was started and owned by Robertson’s brother, Scott Robertson. As president of Infinia, Jon Robertson controlled the finances of the company and had substantial discretion to move the company’s money around as he desired. Robertson was removed as president of Infinia in 2004 but remained actively involved until 2006 in the operations of the company and its finances.

            While Robertson was affiliated with Infinia, he transferred large sums of Infinia money through unofficial, non-salary payments to personal bank accounts and other accounts in his control. Robertson did not report this money as income to the IRS or to Infinia.

            Robertson pled guilty to filing a false tax return in tax year 2003 for failing to report the large sums of Infinia money he surreptitiously transferred to personal accounts. As a part of his sentence, he must pay restitution to the IRS arising out of his criminal activities in the amount of $150,000. The court also ordered him to work with the IRS to resolve other outstanding tax matters.

            The case was investigated by special agents of IRS-Criminal Investigation and prosecuted by attorneys from the Department of Justice’s Tax Division and the U.S. Attorney’s Office in Utah.

SALT LAKE CITY - An individual who pled guilty to disclosure of procurement information and money laundering in connection with a procurement fraud case involving a military contract for services in Afghanistan has been sentenced to 42 months in federal prison.

            U.S. District Judge Tena Campbell, who imposed the sentence, ordered David Young, age 51, of Hernando Beach, Florida, to self-surrender to begin serving the sentence on Aug. 4. Young will be on supervised release for 36 months when he finishes his prison sentence.

            As a part of a plea agreement reached with federal prosecutors, Young admitted that between March and June of 2007, he was deployed as an activated reservist in Afghanistan with the U.S. Army at the Combined Joint Special Operations Task Force and acted as an official liaison for Afghan National Security Force Partnering. In this position, he was involved in supervising the transfer of greater responsibility for Afghanistan’s national security to the Afghans. During that time, according to the plea agreement, a need arose to train the Afghan forces in weapons maintenance and property book management. A decision was made to solicit a pilot contract to meet that need.

            Young admitted that by virtue of his position as a federal official, he possessed confidential bid, proposal, and source selection information concerning this pilot contract which the Army eventually issued solicitations for to private U.S. contractors. The contract stipulated a need for logistics and weapons maintenance support for Afghan commando units.

            According to court records, Michael Taylor, another defendant in the case, was the owner and Chief Executive Officer of American International Security Corporation (AISC). During the source selection process and before the contract was awarded, Young admitted that he disclosed to Taylor and Christopher Harris, also charged in the case, the government’s price estimate for the contract, source selection information, information detailing the competitor’s bid, and other sensitive and protected material. AISC responded to a solicitation and used that information to prepare and submit a bid on the contract. Young admitted the protected information provided a competitive advantage in the source selection process. The Army subsequently awarded the contract to AISC.

            According to the plea agreement, AISC paid Christopher Harris, who worked as the country manager in Afghanistan for AISC, more than $17 million throughout the life of the contract. Young received more than $9.4 million from the proceeds of the contract, according to court records.

            “As we are all aware, families in Utah and across America continue to send loved ones to serve our nation in Afghanistan. Conduct like we see in this case undermines the confidence of American taxpayers who continue to pay for the cost of our efforts in Afghanistan,” U.S. Attorney David B. Barlow said today. “Young held a position of trust with the United States Army and violated his ethical duties as a soldier. He knew full well that he could not ethically use or disclose the protected information as he did.”

            As a part of the plea agreement, Young agreed to forfeit money from multiple bank accounts; 16 pieces of real property in New Hampshire and Florida; money from the sale of a Hummer and boat; a Jaquar; 225 one-ounce American Eagle coins; and 175 one-ounce South African Gold Krugerrand coins.

            Harris, age 49, of Lake Havasu, Arizona, who pled guilty to conspiracy to commit government procurement fraud and money laundering, is scheduled to be sentenced June 23. Sentencing has not been set for Taylor, age 53, of Boston, who pled guilty to a violation of the prohibition of obtaining procurement information. Taylor’s plea agreement includes a recommendation for a sentence of not more than 24 months.

            “The defendant betrayed his oath to the Constitution and abused his position as a military officer to pilfer taxpayer dollars to feed his appetite for wealth and an opulent lifestyle,” said Jonathan Lines, assistant special agent in charge of ICE’s Homeland Security Investigations (HSI) in Utah. “This conviction should make clear, HSI and its investigative partners are committed to ensuring that those who misuse taxpayers' dollars and violate the public's trust are held accountable for their actions.”

            “IRS Criminal Investigation and our investigative partners are pleased with today’s sentencing. The defendant abused his position as a high ranking special ops military officer and betrayed his country, and its taxpayers, by selling vital information for personal gain. IRS CI is committed to investigating egregious crimes such as these,” said IRS Criminal Investigation Assistant Special Agent in Charge, Shea Jones of the Las Vegas Field Office.

            “Fraud and corruption in military contracting not only take away precious dollars necessary for the dedicated American warfighter, but they undermine the confidence of the American public who demand a military procurement system that spends their tax dollars wisely and responsibly. In this case, both a military officer and a government contractor betrayed the public’s trust. This investigation should serve as a warning for those intent on defrauding the U.S. military and the American public that law enforcement will pursue these crimes relentlessly,” Janice M. Flores, Special Agent in Charge of the DCIS Southwest Field Office said.

            The case was investigated by the Defense Criminal Investigative Service (DCIS), U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), Internal Revenue Service-Criminal Investigation, and the U.S. Army Criminal Investigation Command, Major Procurement Fraud Unit. It was prosecuted by Assistant U.S. Attorneys in the U.S. Attorney’s Office in Utah.

SALT LAKE CITY - James Ronald Donahoo, II, age 36, of St. George, Utah, entered guilty pleas to wire fraud, money laundering, and failure to file a tax return in U.S. District Court in Salt Lake City Thursday afternoon in connection with a scheme to defraud individuals and companies he recruited to invest in Paradigm Investing, Inc., a Utah corporation he exercised control over.

            Sentencing is set for Oct. 7, 2014, at 2 p.m. before U.S. District Judge Dee Benson. The plea agreement includes a stipulated sentence of 48 months and supervised release of three years after Donahoo completes his prison sentence. Donahoo also agreed to pay restitution in the approximate amount of $2,793,501.17 to victims of the fraud. Donahoo is in custody.

            As a part of the plea agreement, Donahoo admitted that he misrepresented to investors that if they would invest in Paradigm, they would make a 1 percent to 3 percent return on their investment, which would be paid out monthly. Paradigm never earned any revenues on any of its purported investments from which interest payments could have been made.

            Donahoo admitted he told investors that Paradigm was in the business of making bridge loans or “hard money loans” to small businesses. According to the plea agreement, Paradigm did invest approximately $1.5 million in various businesses. However, the investments were not used to fund bridge loans or hard money loans as Paradigm’s investors were told. Instead, businesses run by Donahoo’s friends, associates, or family members received the money, according to the plea agreement.

            He created false bank statements for Paradigm that he showed to investors to convince them that the investment was safe, low risk, and a good investment. He also told investors that the risk was mitigated by the fact that for every dollar invested, he had a dollar in the bank.

            Donahoo made payments to investors totaling more than $267,000 out of investor funds in furtherance of what was a Ponzi scheme.

            Donahoo admitted that on or about Dec. 5, 2008, he caused two investors to send a $100,000 wire transfer from California to Utah as an investment in Paradigm. On about December 11, 2008, he purchased fur coats in Park City in excess of $10,000. He admitted in the plea agreement that he knew this transaction involved money obtained from his criminal scheme.

            He also admitted that he did not file a tax return for 2008, even though he transferred funds from the Paradigm bank account to his personal bank account totaling $335,000. He used those funds for personal purposes.

            The case was investigated by special agents of IRS-Criminal Investigation and prosecuted by the U.S. Attorney’s Office in Salt Lake City.

            SALT LAKE CITY - Martin A. Pool, age 44, of Atlanta, Georgia, and Armand R. Franquelin, age 57, of Liberty, Utah, pleaded guilty to securities fraud and money laundering Wednesday afternoon in U.S. District Court in Salt Lake City. Pool and Franquelin were charged in a three-count felony information filed in April.

            As a part of a plea agreement reached with federal prosecutors, Pool and Franquelin admitted that from 2006 to 2010, they participated in persuading investors to convert their traditional IRAs to self-directed IRA accounts and invest their funds in a residential real estate project known as Haven Estates in Vernal, Utah. This was accomplished by inducing the investors to direct their funds to their company, The Elva Group, in return for promissory notes from Elva with a promise of monthly interest payments at annual rates between 8 percent and 20 percent. Pool and Franquelin admitted they told investors that their funds would be used to develop Haven Estates and promised to secure their loans with first lien positions in property at Haven Estates. In fact, no investors ever received any collateral or any interest in real property in Haven Estates or anywhere else.

            In reality, the plea agreement says, investors’ funds were used for purposes other than the development of Haven Estates. Investors were not told of encumbrances already in place on Haven Estates. When Elva began defaulting on the mortgage loan for Haven Estates, investors were not immediately informed. Eventually, Haven Estates was foreclosed.

            Pool and Franquelin admitted that these actions were taken in connection with the investors’ purchase of securities, namely the promissory notes and loan agreements. They also admitted that these representations were made for the purpose of defrauding investors.

            According to the plea agreement, investors’ funds were used by Pool and Franquelin and their associates for their personal benefit and to pay interest to earlier investors as Ponzi payments. The Ponzi payments had the effect of lulling the earlier investors, persuading them to leave their funds in the company and inducing them to renew their promissory notes from time to time. The payments also enticed new investors to invest.

            Pool and Franquelin each plead guilty to one count of securities fraud and one count of money laundering.

            As a part of the plea agreement, Pool and Franquelin agreed to pay restitution of $9,031,336.83 to victims of the fraud, including victims of uncharged relevant conduct. Alabama victims invested more than $500,000 in this scheme.

            Alabama Securities Commission Director Joseph Borg, said, "The Alabama Securities Commission is proud to have joined the collaborative efforts of the federal and state law enforcement agencies and their professional staff members to see that justice is served for the victims in this important case. The outcome resulted from a team approach between the U.S. Attorney's Office in Utah, the Utah Department of Commerce's Division of Securities, the FBI, the IRS, and the ASC Enforcement and Legal Divisions to send a message that this financial crime, and others like it, will not be tolerated and will be prosecuted to the fullest extent of the law."

            Pool is scheduled to be sentenced July 31, 2014, at 2:30 p.m. Franquelin’s sentencing is set for Aug. 18, 2014, at 2:30 p.m. Sentences will be imposed by U.S. District Judge Dale A. Kimball. As a part of Pool’s plea agreement, prosecutors and the defendant agreed to recommend the Court impose a 78-month sentence. The sentence is subject to the approval of the Court. Franquelin’s sentence will be determined at the sentencing hearing.

            SALT LAKE CITY - A federal indictment unsealed Monday afternoon in U.S. District Court in Salt Lake City charges eight individuals with conspiracy to distribute oxycodone, conspiracy to commit money laundering and money laundering. The indictment is the fifth and final indictment following a significant oxycodone distribution investigation. Including the defendants charged in the indictment unsealed Monday, 31 individuals have been charged as a part of the case.

            Aaron Peila, age 31, who has lived in Utah and Nevada, is charged with engaging in a continuing criminal enterprise in the first count of the indictment. The indictment alleges Peila obtained substantial income and resources through his violations of federal drug and money laundering laws and that his actions were undertaken in concert with at least five other persons over whom he occupied a position of organizer, supervisor, or any other position of management.

            Peila, who is serving a federal prison sentence for a firearms conviction, allegedly set up a distribution network for oxycodone in Utah. Many of the distributors involved in the network were previously indicted as a part of the ongoing investigation.

            Also charged in the indictment unsealed Monday are Jonas Newell, age 29, of Provo; Candace Newman, age 27, of Las Vegas; Mark Jaffe, age 33, of Salt Lake City; Carolyn Barrera, age 30, of Salt Lake City; Kevin Lynch, age 53, of Las Vegas; and Jason Junior, age 45, and Syndi Junior, age 33, both of Pleasant Grove. Jaffe, Barrera, and Newell appeared in federal court Monday in Salt Lake City. Barrera was released on conditions. A detention hearing will be held Wednesday for Jaffe. Newell’s detention hearing will be Friday. Other defendants are making appearances in Idaho and Las Vegas this week.

            The majority of counts in the indictment charge Peila and others named in the indictment with conspiracies to distribute oxycodone and conspiracy to commit money laundering from about May 2007 through various periods of time up to June 2012.

            The continuing criminal enterprise charge carries a mandatory-minimum 20- year penalty with a maximum penalty of life and a maximum fine of $2 million. The drug trafficking conspiracy counts each have 20-year potential penalties with fines of $2 million. The money laundering counts carry a maximum penalty of 20 years and fines of up to $500,000.

            An indictment is not a finding of guilt. Individuals charged in indictments are presumed innocent unless or until proven guilty in court.

            The case is being investigated by special agents of the DEA and IRS and Salt Lake City police officers. It is being prosecuted by the U.S. Attorney’s Office in Utah.

SALT LAKE CITY - A three-count indictment unsealed Tuesday in U.S. District Court in Salt Lake City charges Raymond Michael Livingston, aka Bobby and Michael, age 34, with possession of 18 stolen firearms and burglary of a federal firearms licensee in connection with a June 23, 2013, burglary of Stewart’s Ace Hardware in Roosevelt.

            Livingston, who has lived in Ballard, Utah, and Las Vegas, Nev., is also charged with receiving firearms while under Felony Information. At the time the indictment alleges he was in possession of the firearms stolen in Utah, he was facing a forgery charge in Nevada.

            Livingston had an initial appearance Tuesday in federal court and entered not guilty pleas to the charges in the indictment. A five-day jury trial has been scheduled to start July 21, 2014, in U.S. District Judge David Nuffer’s courtroom. A detention hearing is set for Wednesday at 9:30 a.m. before U.S. Magistrate Judge Evelyn J. Furse.

            Five of the firearms taken during the Roosevelt burglary have been recovered by the Las Vegas Metro Police Department during criminal investigations.

            The potential maximum penalty for possession of stolen firearms and burglary of a federal firearms licensee is 10 years in prison and a fine of $250,000. Receiving firearms while under Felony Information has a potential five-year penalty. Indictments are not findings of guilt. Individuals charged in indictments are presumed innocent unless or until proven guilty in court.

            The case is being investigated by ATF special agents and prosecuted by the U.S. Attorney’s Office in Salt Lake City as a part of Utah Project Safe Neighborhoods, an initiative that targets gun violence in Utah communities.

SALT LAKE CITY - Macon Openshaw, 21, pleaded guilty in the U.S. District Court for the District of Utah Wednesday to a federal civil rights crime relating to a bias-motivated weapons discharge aimed at a local synagogue and to two unlawful gun possession charges.

            During the plea proceedings, Openshaw admitted that late at night on a date in 2012, he fired three rounds from a Walther .22 caliber handgun at the Congregation Kol Ami synagogue in Salt Lake City because of its religious character, hitting the unoccupied structure’s second floor window casing and the exterior wall of the synagogue. Openshaw also admitted to possessing a handgun with a destroyed serial number, which was the same handgun he used to shoot the synagogue. He also admitted to possessing several firearms and ammunition while he was subject to a protective order.

            “Religiously-motivated violence tears at the fabric of our diverse society,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division. “Today, and in the future, the department stands vigilant to confront and eradicate violence based on a person’s religion, and we will continue to vigorously prosecute those who commit crimes born of hate.”

            “Every citizen living in Utah has a right to be free from intimidation and threatening conduct,” said U.S. Attorney David B. Barlow. “The U.S. Attorney’s Office in Utah has a strong history of prosecuting those who violate the civil rights of others.”

            Openshaw entered into a plea agreement whereby he would be sentenced to 60 months incarceration. As part of his plea agreement, Openshaw agreed to pay restitution to the synagogue to repair the damage caused by his actions. Openshaw is scheduled to be sentenced on July 15, 2014, by U.S. District Judge Tena Campbell.

            This case was investigated by the FBI and is being prosecuted by Assistant U.S. Attorney Carlos Esqueda of the U.S. Attorney’s Office for the District of Utah and Trial Attorney Nicholas Durham of the Civil Rights Division’s Criminal Section.

SALT LAKE CITY - The U.S. Attorney’s Office in Utah and the Department of Justice announced Monday that an information has been filed charging Robert Keller, 70, with interfering with the housing rights of three members of an interracial family because of the family members’ races and because the family members were living in Hurricane, Utah.

            Keller has been charged with two misdemeanor counts of criminal interference with a right to fair housing. More specifically, the information alleges that Keller wrote a note to two Caucasian family members of an interracial family threatening to kill them if they did not make their African-American family member leave their home and the community. The first count alleges that Keller’s threats interfered with the housing rights of the Caucasian residents to associate in their home with their African-American family member, and the second count alleges that Keller’s threats interfered with the African-American resident’s right to occupy the home.

            A summons will be issued to Keller to appear in federal court. If convicted, Keller faces a statutory maximum penalty of one year in prison on each count.

            This case is being investigated by the Salt Lake City Division of the FBI in cooperation with the Hurricane City Police Department. It is being prosecuted by Trial Attorney Saeed Mody of the Civil Rights Division and Assistant U.S. Attorney Carlos Esqueda for the District of Utah.

            An information is merely an accusation, and the defendant is presumed innocent unless proven guilty.

            “I have just informed Attorney General Holder and Senators Hatch and Lee that I have decided to conclude my service as United States Attorney this summer and return to private practice at Sidley Austin LLP. I am making this announcement in advance of my departure so that President Obama and Senators Hatch and Lee will be able to begin the process of selecting and vetting our next U.S. Attorney.

            “U.S. Attorneys are not permanent fixtures in their offices. Serving as U.S. Attorney for the better part of three years has been and continues to be the most humbling honor and privilege of my career. However, for family reasons, my wife and I have decided to make the change this summer.

            “I look forward to the remaining time I have to serve with the truly outstanding attorneys and other legal professionals in the U.S. Attorney’s Office, as well as our counterpart defense counsel; judges and court personnel; and federal, state, local, and tribal law enforcement who serve the people of Utah with such distinction.”

 

ST. GEORGE – Troy James Knapp, age 46, charged in a federal indictment in October with assaulting a federal officer and two violations of federal firearms laws, pleaded guilty Monday afternoon in federal court in St. George to use, carry and discharge of a firearm during and in relation to a crime of violence.

            The count of conviction carries a potential life sentence with a 10-year minimum mandatory sentence. The plea agreement includes a recommendation that a 126-month sentence be imposed in the case. The sentence is subject to the approval of the Court. Sentencing in the case has been scheduled for June 9, 2014, at 10 a.m. in St. George.

            Knapp was arrested in a remote area of Sanpete County on April 2, 2013. The indictment alleged that as events unfolded that day leading to his arrest, he assaulted federal officers engaged in the performance of their official duties. The officers included a Deputy United States Marshal, a U.S. Forest Service Law Enforcement Officer, and others who were assisting federal officers. The indictment also alleged he discharged an SKS-type assault rifle during the violent crime of assaulting a federal officer.

            As a part of the plea agreement, Knapp stipulated that he carried, used, and discharged a rifle as he was attempting to flee from law enforcement authorities. He admitted that when he discharged the rifle, he intended to impede federal officers and those assisting them from apprehending him.

            Federal prosecutors agreed to dismiss one count of assaulting a federal officer and one count of felon in possession of firearms and ammunition at sentencing as a part of the plea agreement.

            Sanpete County Attorney Brody L. Keisel was designated a Special Assistant U.S. Attorney and assisted in the prosecution of the federal case. Several federal, state, and local agencies contributed to the investigation.

SALT LAKE CITY - Thirteen arrests were made Wednesday as a part of a federal Organized Crime Drug Enforcement Task Force case targeting the distribution of methamphetamine and heroin in Utah by alleged members of the La Raza gang and their associates.

            The individuals are charged in two indictments unsealed Wednesday and Thursday with distribution of methamphetamine and heroin; conspiracy to distribute methamphetamine and heroin; possession of methamphetamine and heroin with intent to distribute; and money laundering.

            During the execution of the arrests and searches Wednesday, law enforcement officers seized approximately 10 pounds of methamphetamine and heroin, seven firearms, eight vehicles, and approximately $175,000 in cash.

            Several local and state agencies contributed to the joint operation including the FBI’s Safe Streets Task Force, IRS Criminal Investigation, Salt Lake City, West Valley, Sandy, and West Jordan police departments, the U.S. Marshals Service, the Unified Police Department, the Metro Gang Unit, and the Utah Department of Public Safety. Several other agencies assisted in executing arrest and search warrants Wednesday in the Salt Lake metro area, Richfield, and St. George, including the Utah County Sheriff’s Office, the Utah County Major Crimes Task Force, Utah and Sevier County Sheriffs’ Offices, St. George, Spanish Fork and Richfield police departments, the Utah Highway Patrol, the Washington County Drug Task Force, and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations.

            Law enforcement officers and prosecutors involved in this case say it is part of a coordinated effort to combat an increasing threat to the safety of Utah communities from the involvement of gangs in drug trafficking. Gang involvement in the retail drug trade poses a risk to communities because distribution activities are routinely associated with violence as disputes over control of drug territory and enforcement of drug debts occurs.

            Juan Lazareno, age 30, of Santa Clara, and an individual identified as FNU LNU (first name unknown – last name unknown) are charged with distribution of methamphetamine in an indictment unsealed in St. George Wednesday. Lazareno was arrested Wednesday and appeared before U.S. Magistrate Judge Robert Braithwaite. He is being detained pending a detention hearing to be scheduled later. The potential maximum penalty for the charge is life in prison with a 10-year minimum mandatory sentence.

            Thirteen individuals are charged in the second indictment, unsealed Thursday morning in federal court in Salt Lake City. They are Wayne LeRoy Burr aka Miclo, age 30, of Draper; Samuel Covarrubias-Velazquez aka Pollo, age 36, of West Valley City; Javier Corrales, age 34, of Provo; Juan Reveles, age 35, of Richfield; David Miramontes, age 28, of West Valley City; Anthony Pedroza, age 26, of West Valley City; Carlos Tenengueno, age 24, of Sandy; Jose Munoz, age 26, of Salt Lake City; Beatriz Miramontes, age 56, of Richfield; Elisa Gallardo, age 27, of Draper; Guillermo Miramontes, age 22, of Salt Lake City; and William Reveles, age 34, of West Valley City. Alejandro Arciniega-Zetin, age 24, of Salt Lake City has not been arrested.

            Burr and Covarrubias-Velazquez are charged in the first two counts of the indictment with conspiracy to distribute methamphetamine and heroin. The indictment alleges that beginning at least by May 1, 2013, and continuing until at least Jan. 21, 2014, the pair conspired to distribute 500 grams or more of a substance containing a detectable amount of methamphetamine and one kilogram or more of a substance containing a detectable amount of heroin. The majority of the 31-counts in the indictment charge defendants with distribution of methamphetamine; possession of methamphetamine with intent to distribute; distribution of heroin, possession of heroin with intent to distribute; and money laundering.

            There are 25 drug trafficking counts in the indictment. Each of them, with the exception of counts 14, 15, 20 and 21, has a potential life sentence with a 10-year minimum mandatory sentence. Counts 14, 15, 20 and 21 have potential 40-year sentences with five-year minimum mandatory sentences.

            Six money laundering counts in the indictment allege defendants purchased vehicles using cash derived from drug trafficking. The money laundering counts carry potential 10-year sentences.

            Individuals charged in this indictment had initial appearances Thursday in federal court in Salt Lake City. Elisa Gallardo was released following her initial appearance. Detention hearings for the other defendants are under way Friday morning in U.S. Magistrate Judge Brooke Wells’ courtroom.

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

SALT LAKE CITY - U.S. District Judge Dee Benson sentenced Shawn William Turley, age 50, of West Valley City to 15 years in prison Wednesday afternoon in U.S. District Court in Salt Lake City. Turley, who pleaded guilty in January to possession of child pornography, will be on supervised release for life when he finishes his federal sentence.

            The federal sentencing guideline range in the case was 121-151 months. As a part of a plea agreement reached in the case, a 15-year sentence was recommended to the Court. Turley faced the significant sentence because of his prior convictions.

            As a part of the plea agreement, Turley admitted that Utah Adult Probation and Parole agents conducted a field visit at his residence in July 2013 after a 12-year-old child disclosed that he had been sexually abusing her for a year. The agents located a phone hidden under Turley’s mattress and box springs during the field visit. West Valley City police officers and U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations agents joined the investigation. Turley admitted in the plea agreement that his phone contained more than 600 images of prepubescent and pubescent females in sexually suggestive poses.

            Turley admitted he obtained the pictures using a peer-to-peer network. As a part of the plea agreement, Turley also admitted to law enforcement officers that he sexually abused the 12-year-old child for approximately one year. He also acknowledged that he was being supervised by Utah Adult Probation and Parole for 1987 convictions for at least one qualifying first-degree felony in Utah’s Fourth District Court in Utah County.

            The case was investigated by Utah Adult Probation and Parole, the West Valley City Police Department, and HSI. The case is being prosecuted by the U.S. Attorney’s Office in Salt Lake City.

SALT LAKE CITY - Two residents of Utah were sentenced to two-year prison sentences in U.S. District Court in Salt Lake City this week after pleading guilty to filing false tax returns that understated their income.

            U.S. District Court Judge Clark Waddoups sentenced Larry Oral Bosh, age 46, of Nephi, to two years in federal prison and one year of supervised release after he concludes the prison sentence. Bosh must pay restitution of $563,672 to the IRS. The sentenced was imposed Tuesday afternoon.

            In a plea agreement reached with federal prosecutors, Bosh admitted that from June 2007 through October 2008, he earned a substantial income from Evolution Developments, LLC and Clover Creek, LLC. He admitted he willfully failed to accurately report this income to the IRS. According to the indictment in the case, Bosh reported $5,502 in income during 2008, under-reporting his income by $1,732,502.

            In the plea agreement, Bosh admitted that around April 20, 2010, he prepared, signed and filed a false individual tax return for tax year 2008. He admitted that as a result of those actions, he owed the IRS $563,672.

            In a separate case, U.S. District Judge David Nuffer sentenced David Shawn Benson, age 40, of Ivins, Utah, to two years in prison and one year of supervised release for filing a false tax return. Benson was sentenced Tuesday.

            According to the indictment charging Benson, he reported $37,982 in income during 2008, under-reporting his income by $1,902,109.

            As a part of a plea agreement with federal prosecutors, Benson admitted that from June 2007 through October 2008, he earned substantial income from SHB Enterprises, LLC and Evolution Developments, LLC. He admitted he willfully failed to report this income to the IRS. On April 12, 2010, he prepared, signed, and filed a false individual tax return with the IRS knowing that it understated the taxable income he earned during tax year 2008. Judge Nuffer ordered Benson to pay $610,467 in restitution to the IRS.

            The cases were investigated by special agents of IRS Criminal Investigation and prosecuted by the U.S. Attorney’s Office in Utah.

SALT LAKE CITY - A grand jury returned an indictment Wednesday afternoon charging Dominic Matthew Martinez, age 28, of Salt Lake City, and Jennifer Meradee Tryon, age 43, of Price, with a Nov. 26, 2013, armed robbery of Smith’s Food and Drug located at 1075 East Main Street in Price.

            The indictment also alleges they used a firearm during a crime of violence. Martinez is charged in the final count of the indictment with possession of a firearm and ammunition following a felony conviction.

            Martinez and Tryon are in state custody. A federal arrest warrant has been issued in the case.

            The potential maximum penalty for robbery under the federal Hobbs Act is 20 years in prison. Brandishing a firearm during a crime of violence carries a potential life sentence with a seven-year mandatory minimum sentence. Possession of a firearm by a restricted person has a potential 10-year sentence.

            The robbery occurred about 11 a.m. on Nov. 26. Surveillance footage of the robbery was obtained from the store along with other evidence. Martinez and Tryon were identified as suspects in the case after an investigation by the Price Police Department, the Utah Department of Public Safety, the ATF and the U.S. Marshals Service.

SALT LAKE CITY - A federal grand jury returned a four-count indictment Wednesday afternoon charging Jared Ehlers, age 35, of Moab, with violations of federal law in connection with the excavation and removal of a three-toed dinosaur track from the Hell’s Revenge area of the Sand Flats recreation. The land is administered by the U.S. Bureau of Land Management.

            A summons will be issued to Ehlers to appear in federal court.

            The first count of the indictment, removal of paleontological resources, alleges Ehlers knowingly excavated, removed, damaged or otherwise altered or defaced the three-toed dinosaur track, located on federal land. The potential maximum penalty for this count is five years in prison.

            Ehlers is charged with theft of government property in the second count of the indictment. The indictment alleges he took the dinosaur print, which was property of the United States, and converted it to his own use. The potential maximum penalty for this count is 10 years in prison.

            The third count of the indictment alleges depredation of government property. According to the indictment, Ehlers damaged property of the United States by excavating and altering paleontological resources. This count also carries a potential 10-year prison sentence,

            The final count of the indictment, destruction of evidence, alleges Ehlers tried to destroy or conceal the dinosaur track in an effort to obstruct or influence the investigation. The potential penalty for this count is 20 years in prison.

            The case is being investigated by BLM special agents and the Grand County Sheriff’s Office. The Utah Department of Public Safety also assisted in the case.

            An indictment is not a finding of guilt. Individuals charged in indictments are presumed innocent unless or until proven guilty in court.

SALT LAKE CITY - A federal grand jury returned an indictment Wednesday charging Charles Fredrick McCusker, age 62, of Salt Lake City, a licensed Utah psychologist, with health care fraud and mail fraud in connection with a health care fraud scheme the indictment alleges caused federal and private benefit programs to pay more than $1.3 million for services not provided to patients. The indictment alleges the conduct occurred from around 2007 to around August 2013.

            The indictment, which includes 18 counts of health care fraud and 16 counts of mail fraud, follows a coordinated investigation by the FBI, the U.S. Health and Human Services’ Office of Inspector General, the Utah Insurance Fraud Division, the Utah Attorney General’s Office, and the U.S. Attorney’s Office. The indictment follows a state felony information filed on February 20, 2014, charging McCusker with 25 second degree felonies alleging identity fraud, insurance fraud, and pattern of unlawful conduct.

            According to the indictment, McCusker conducted business as Health Balance International and New Life Balance in Salt Lake City.

            The indictment alleges McCusker executed a scheme to defraud health care benefit programs by billing private insurers and government health care programs for services not provided to patients, resulting in payments to which he was not entitled.

            McCusker, the indictment alleges, obtained health insurance information from patients under the guise that he would bill health care benefit programs only for services actually provided. As further steps in the scheme to defraud, McCusker did not meet at all with some patients nor did he provide any follow up services. Despite that fact, the indictment alleges, McCusker fraudulently billed patients’ health care programs for services he did not provide.

            In other instances, McCusker met with a patient only once and provided no follow up services. Despite that fact, the indictment alleges, McCusker falsely billed the patients’ health care benefit programs for follow up services not provided. On other occasions, McCusker provided services to patients on several occasions but fraudulently billed these patients’ health care benefit programs for numerous additional services not provided.

            According to the indictment, McCusker fraudulently submitted claims to health care benefit programs seeking reimbursement for services he did not provide. Those claims were processed and paid by health care benefit programs.

            A summons will be issued to McCusker to appear in federal court. The potential maximum penalty for each count of health care fraud is 10 years and the penalty for each mail fraud count is 20 years.

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

SALT LAKE CITY - David Warren Evans, age 44, of Magna, Utah, convicted of a September 2013 armed robbery of a Wells Fargo Bank located at 1255 East Brickyard Road in Salt Lake City, will serve 84 months in federal prison. U.S. District Judge Tena Campbell imposed the sentence Wednesday afternoon.

            Judge Campbell also ordered Evans to be on supervised release for 60 months after he concludes his federal prison sentence. He also must pay $1,759 in restitution to Wells Fargo Bank.

            In a December plea agreement, Evans admitted that he entered the bank wearing a hooded black sweatshirt, black sunglasses, and a red bandana over his head. He handed the teller a note demanding cash. He held what appeared to be a black handgun so it was visible to the teller during the robbery. The teller complied with his demands.

            Evans also admitted he robbed a Wells Fargo Bank located at 4740 South 900 East in Murray in September 2013. He approached the teller and handed her a note that read: “This is a robbery, don’t make it a murder.” The teller complied with his demands.

            In addition to other evidence, still photos from the robberies were released to the media and members of the public and law enforcement officers identified Evans as robbery suspect.

            The case was investigated by the Utah Safe Streets Task Force, the FBI and Salt Lake City and Murray City Police Departments. It was prosecuted by the U.S. Attorney’s Office in Salt Lake City.

SALT LAKE CITY - A felony information filed in federal court Tuesday morning charges Daniel Joseph Carlton, age 66, of Salt Lake City, with credit union robbery in connection with a Jan. 10, 2014, robbery of Transwest Credit Union. The credit union is located at 39 West 2100 South, Salt Lake City.

            According to an information filed in Third District Court, Carlton handed a note to a teller at the credit union demanding money. The state charges will be dismissed now that federal charges have been filed. Stephen L. Nelson, a Deputy District Attorney and Special Assistant U.S. Attorney, will join federal prosecutors in handling the federal case.

            The potential maximum penalty for credit union robbery is 20 years in prison and a fine of $250,000. However, based on two previous convictions for bank robbery, Carlton appears to qualify as a career offender under federal sentencing guidelines and could be subject to an increased term of incarceration. He was on supervised release for two previous bank robberies at the time of the current alleged offense.

            "Bank robbery is a federal crime,” U.S. Attorney David B. Barlow said today. “The FBI, through its Safe Streets Task Force, and local law enforcement agencies are aggressively investigating every bank robbery. Anyone who commits a bank robbery is subject to prosecution in federal court, and, if convicted, faces significant federal sentences.”

            Barlow expressed appreciation for the investigative work being done by the FBI and members of its Safe Street Task Force, local law enforcement agencies, and county attorneys’ offices in investigating and prosecuting bank robberies in Utah.

            FBI Special Agent in Charge Mary F. Rook stated, "The FBI is committed to working with our state and local law enforcement partners to actively investigate and apprehend bank robbery suspects throughout the region. The Safe Streets Task Force is a great example of the positive impact we can achieve through coordination and collaboration with other agencies."

James Pearson Thain

            James Pearson Thain is in custody in Wyoming charged with a Jan. 29, 2014, robbery of Bank of the West in Casper, Wyo. According to the complaint, Thain displayed a handgun. A witness saw Thain and a female driver leave the bank and reported the information to law enforcement. Officers tried to initiate a traffic stop by the vehicle fled the area and was later involved in a crash. Officers found a revolver in the car with two rounds in the cylinder of the weapon. According to the complaint, Thain said the gun was for “cops, hero’s and tellers.”

            The FBI and U.S. Attorney’s Office in Utah believe Thain, who wore a fake moustache, large glasses, and a beanie hat during the Wyoming robbery, may be responsible for 11 robberies in Utah and are coordinating with the U.S. Attorney’s Office in Wyoming on the Thain case.

            Thain, who is 38, has previous bank robbery convictions in Utah.

Dustin Todd Byrd

            Dustin Todd Byrd, 36, of Salt Lake City, currently in custody in Ada County, Idaho, after an arrest on heroin trafficking, is suspected of four recent bank robberies in Utah. Federal prosecutors expect to present the case to a grand jury in early March.

David Warren Evens

            Sentencing is set for Wednesday at 2 p.m. for David Warren Evans, age 43, of Magna, who pleaded guilty in December to a Sept. 26, 2013, armed robbery of Wells Fargo Bank located at 1255 East Brickyard Road in Salt Lake City. U.S. District Judge Tena Campbell will impose the sentence. In a plea agreement, Evans admitted that he held what appeared to be a black handgun during the robbery that was visible to the teller.

            He also admitted that on Sept. 11, 2013, he robbed a Wells Fargo Bank at 4740 South 900 East. He admitted he approached the teller and handed her a note that said, “This is a robbery, don’t make it a murder.”

William and Michelle Parker

            William Joseph Parker, age 28, and Michelle Joyce Parker, 28, both of Tooele, are scheduled to be sentenced in April after each pleading guilty to one count of bank robbery.

            William Joseph Parker admitted that on Jan. 14, 2013, he robbed the Wells Fargo Bank in Magna. He admitted he walked into the bank with a note in hand that demanded money from both drawers, indicating he had a gun and would use violence.

            Michelle Joyce Parker admitted robbing a Wells Fargo Bank in Tooele on March 11, 2013.

            In addition to the two robberies included in the plea agreements, the Parkers also were charged with a Feb. 5, 2013, robbery of a Wells Fargo Bank in Murray.

            The Parkers were arrested after the March 11, 2013, robbery when an off-duty police officer took note of the car prior to the robbery and saw it fleeing the scene afterwards. He executed a traffic stop and found the defendants, the robbery note, and cash in the car – in addition to the couple’s two young children.

            As a part of their plea agreements, the Parkers agreed to pay restitution of $5,032 to Wells Fargo Bank for all charged robberies.

            Both face up to 20 years in federal prison when they are sentenced in April.

John Eugene Walker

            Sentencing is set for May 13, 2014, for John Eugene Walker, age 53, of South Salt Lake City, who pleaded guilty in December to two bank robberies.

            Walker admitted that he committed a May 3, 2013, robbery of U.S. Bank located at 888 East 4500 South in Salt Lake City while dressed as a construction worker and carrying a dark colored messenger style bag. He approached a teller counter and demand money. He put the money in his bag and left the bank.

            He also robbed a Zions Bank at 8955 South 700 East in Sandy on May 22, 2013, while dressed in women’s clothing and carrying a light blue purse. He put the money the teller gave him in the purse.

            Walker was arrested after bank employees followed him out of the bank and witnessed him getting into a dark green Toyota. The same witness saw a temporary tag on the vehicle. Surveillance photos of the robbery were released to the media and an employee from a car dealership contacted the Sandy Police after seeing news coverage of the robbery and told police officers she had recently sold a Toyota to an individual who matched the description of the suspect who robbed the Zions Bank.

            Walker faces up to 20 years in prison for each of the two bank robbery convictions. Prosecutors believe Walker may qualify for an increased sentence as a career offender under federal sentencing guidelines because of his criminal history.

James Carey

            James Carey, age 40, of Midvale was sentenced to 125 months in federal prison in June after pleading guilty to a Feb. 4, 2013, robbery of Chase Bank located at 1306 Woodland Avenue in Salt Lake City. Carey admitted he entered the bank and presented a note to a teller demanding $20,000 and stating that he had a gun. He brandished what appeared to be a handgun but was actually a BB gun. Carey admitted that the following day, when police tried to apprehend him, he engaged in a high speed chase. During the high speed chase, Carey threw a duffel bag and money out of the car. The chase ended after his tires were spiked and the police had executed a PIT maneuver. Carey refused to comply with officers’ commands and had to be forcibly restrained.

Mark Scott Bolinder

            Mark Scott Bolinder, age 44, of Salt Lake City, is serving a 38-month federal prison sentence after pleading guilty to a Sept. 21, 2013 robbery of Chase Bank located at 6275 South Highland Drive in Salt Lake City and a Sept 23, 2013, robbery of Zions Bank located at 1635 South Redwood Road in Salt Lake City. U.S. District Judge Robert Shelby imposed the sentence in January and ordered Bolinder to pay $2,929 in restitution to the two banks.

            The Unified Police Department and FBI investigated the robberies. Video surveillance photos from the robberies were released to the media and tips were received leading to Bolinder’s arrest.