Eastern District of Virginia

ALEXANDRIA, Va. – A local businessman was sentenced today to 2 1/2 years in prison for orchestrating a $1.3 million Ponzi scheme that caused losses to more than 40 victims.

According to court documents, Amrit Jaswant Singh Chahal, 31, of Fairfax, operated an investment fraud scheme through The Kane Capital Investment Group, LLC (Kane Capital), a company he established and operated. Chahal held out Kane Capital as a private capital investment group that sought to earn profits and investment returns on behalf of its clients by purchasing, trading, or otherwise investing in commodities for future delivery and other financial instruments. Chahal executed this fraud through falsely representing that Kane Capital had earned returns of roughly 28 to 34 percent annually, when in fact, Chahal had suffered substantial losses in managing investors’ funds. Chahal also created falsified brokerage statements to conceal the losses he had sustained and siphoned off some of his investors’ funds by transferring the money to accounts he controlled or by spending the funds on personal items. When investors asked for returns on their investment, Chahal frequently used money from newer investors to pay disbursements to older investors, without disclosing this fact to his investors. In addition, Chahal opened an unauthorized bank account in the name of one of his investors to further divert funds to his personal use.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, and Matthew J. DeSarno, Special Agent in Charge of the FBI Washington Field Office’s Criminal Division, made the announcement after sentencing by U.S. District Judge Leonie M. Brinkema. Assistant U.S. Attorneys Matthew Burke and Jamar K. Walker prosecuted the case.

The Virginia State Corporation Commission provided significant assistance with this investigation.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:18-cr-152.

NORFOLK, Va. – A Virginia Beach woman was sentenced today to 30 years in prison for her role in a heroin and fentanyl distribution conspiracy that resulted in an overdose death.

“The callousness of Michelle Best is hard to overstate considering her knowledge of the death she helped cause and her desire to continue ‘business as usual,’” said G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia. “As a high-level regional supplier, she was attributed with enough fentanyl to supply 20,000 potentially lethal doses. The sentence in this case should serve as a reminder of what can happen to those who make it their business to exploit and profit by spreading poison in our communities. We will remain relentless in our efforts to hold drug dealers accountable.”

According to court documents, Michelle Renee Best, aka Michelle Smith, 44, served as a regional wholesale supplier of fentanyl, heroin, and cocaine for over a year and half, and she did so from the comfort of her beachfront Croatan neighborhood. Even after learning that her drugs killed a young woman, she told a co-conspirator to keep the news of the death to himself and that it would be “business as usual.” On March 13, 2018, a Virginia Beach SWAT team executed a search warrant on Best’s house and recovered a commercial money counter, nearly $42,000 in cash, 1.85 kilograms of cocaine, 1.12 kilograms of marijuana, 382 grams of heroin laced with fentanyl, 207 pieces of jewelry, a drug ledger, and devices used for drug manufacturing. Officers also recovered four firearms at her home, including an AR-15 rifle. Additionally, when she was arrested, officers seized a fifth gun from her purse—a .380 Kel-Tec handgun. Best was a previously convicted felon for having run a dog fighting ring and was thus prohibited from possessing a firearm.

“Fentanyl is uniquely dangerous because it is so deadly and so profitable,” said Mark R. Herring, Virginia Attorney General. “We’ve made stemming the supply of fentanyl a real priority because it has been a primary driver in the surge of fatal overdoses in Virginia and around the country. Hampton Roads is safer with this operation out of business.”

After her arrest, she attempted to obstruct the investigation by instructing others to interfere with a co-defendant and another individual whom she believed to be a confidential informant, telling another individual that the person she believed was a confidential informant “needs to be taken care of before [he/she] disappears.”

“The Washington Metropolitan Area has some of the highest opioid overdose rates in the nation,” said Jesse R. Fong, Special Agent in Charge for the Drug Enforcement Administration’s (DEA) Washington Field Division. “This sentencing is a prime example of the extent the Drug Enforcement Administration, and our law enforcement counterparts, will go to bring to justice those organizations and individuals, who seek to illegally profit from our communities and citizens without any regard for human life.”

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department reinvigorated PSN in 2017 as part of a renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Mark R. Herring, Attorney General of Virginia, Jesse R. Fong, Special Agent in Charge for the Drug Enforcement Administration’s (DEA) Washington Field Division, and James A. Cervera, Chief of Virginia Beach Police, made the announcement after sentencing by Chief U.S. District Judge Mark S. Davis. Assistant U.S. Attorneys John F. Butler and Andrew Bosse prosecuted the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:18-cr-147.

NORFOLK, Va. – Two Portsmouth men were arrested today for their alleged roles in a racketeering conspiracy that included the murder of 23-year-old Delante Eley.

A federal grand jury returned a 13-count indictment on March 6, charging Rashaun Taylor, aka “Diablo”, 31, and Timothy Sawyer-House, aka “Trouble”, 28, with racketeering conspiracy, attempted robbery, felon in possession of a firearm, and distribution of heroin and fentanyl. Taylor was also charged with the capital-eligible offense of murder in aid of racketeering and use of a firearm resulting in death.

According to the indictment, the two men allegedly were members of a Portsmouth-based “set” of the Nine Trey Gangsters (NTG), a gang affiliated with the United Blood Nation. The indictment alleges that on March 11, 2014, after a series of incidents between Delante Eley and members of Taylor’s gang, Taylor and Sawyer-House followed Eley to his home, where Taylor shot and killed Eley. Two days later, Taylor, Sawyer-House, and others attempted to rob a drug dealer of cash, heroin, cocaine, and marijuana while armed with a high powered Romanian-made semi-automatic rifle.

The indictment also alleges that Taylor and Sawyer-House sold heroin and fentanyl.

If convicted of the charged murder, Taylor would be eligible for the death penalty or a mandatory life sentence. If Sawyer-House is convicted, he faces a mandatory minimum of 15 years and a maximum of life in prison. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.

The case was investigated as part of the Organized Crime Drug Enforcement Task Force (OCDETF) Operation Billy Club. The OCDETF program is a federal multi-agency, multi-jurisdictional task force that supplies supplemental federal funding to federal and state agencies involved in the identification, investigation, and prosecution of major drug trafficking organizations. The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Martin Culbreth, Special Agent in Charge of the FBI’s Norfolk Field Office, and Tonya D. Chapman, Chief of Portsmouth Police, made the announcement following the arrest of both men. Assistant U.S. Attorneys John F. Butler and Andrew C. Bosse are prosecuting the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:19-cr-36.

ALEXANDRIA, Va. – A federal jury convicted a New York man today on charges of conspiracy to distribute methamphetamine.

According to court records and evidence presented at trial, Kendesia Juinize May, 40, was a leader of a sprawling, nationwide methamphetamine distribution network with ties to California, New York, Washington, DC, and the Eastern District of Virginia. The network utilized pirated and fraudulent Federal Express accounts to ship pound quantities of California-sourced methamphetamine throughout the United States.

In late 2017, May negotiated to buy into the conspiracy and assume distribution responsibilities to its Washington, DC area customers, many of whom were themselves distributors of methamphetamine. According to evidence presented at trial, May “took over” methamphetamine distribution in the northern Virginia and Washington, DC area and aspired to become “the biggest drug dealer on the East Coast.”

Multiple witnesses testified that May traveled from his home in New York to the Washington, DC area every week for the purpose of selling methamphetamine. He did so because the Washington, DC area is one of the most lucrative methamphetamine markets in the country. 

The government presented evidence showing that the conspiracy sent nearly 400 FedEx packages containing either pound quantities of methamphetamine or thousands of dollars in proceeds of drug sales. On May 25, 2018, officers of the Maryland Transportation Authority Police stopped May while driving his Mercedez Benz vehicle, and a search of the vehicle led to the discovery of more than five pounds of pure methamphetamine, along with FedEx packaging, digital scales, and other drug paraphernalia.

May faces a mandatory minimum of 10 years in prison when sentenced on June 7. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.

This case was prosecuted as part of Organized Crime Drug Enforcement Task Force (OCDETF) Operation Four Horsemen. The OCDETF program is a federal multi-agency, multi-jurisdictional task force that supplies supplemental federal funding to federal and state agencies involved in the identification, investigation, and prosecution of major drug trafficking organizations.  The principal mission of the OCDETF program is to identify, disrupt, and dismantle the most serious drug trafficking, weapons trafficking, and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.

This investigation was led by the DEA Washington Field Office, with significant assistance from the Arlington County Police Department, U.S. Postal Inspector Service, the DEA Baltimore District Office, and the Maryland Transportation Authority Police.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Jesse R. Fong, Special Agent in Charge for the Drug Enforcement Administration’s (DEA) Washington Field Division, M. Jay Farr, Arlington County Chief of Police, and Peter R. Rendina, Inspector in Charge of the Washington Division of the U.S. Postal Inspection Service, made the announcement after U.S. District Judge Leonie M. Brinkema accepted the verdict. Assistant U.S. Attorneys David A. Peters and Katherine E. Rumbaugh are prosecuting the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:19-cr-7.

NEWPORT NEWS, Va. – A Matthews woman was sentenced today to four years in prison for computer fraud and theft of government property in connection with an extensive timekeeping fraud that resulted in losses of over $1.4 million, which she was ordered to pay in restitution.

According to court documents, Michelle M. Holt, 52, was previously employed as a federal employee for the Department of Defense. Holt worked as a secretary for U.S. Air Force, Air Combat Command, Communication Support Squadron, at Joint Base Langley-Eustis. Holt was a salaried employee on the General Schedule (GS) grade for the federal civilian workforce. As such, she was entitled to overtime pay if authorized by her employer, was also entitled to other forms of holiday and annual leave, and premium pay for any federal holidays worked.

A law enforcement investigation determined that from December 2001 to July 2018, Holt falsely claimed over 42,000 hours in unauthorized overtime for hours she did not work, as well as other amounts of unauthorized holiday leave, sick leave and annual leave, all amounting to losses to the United States of more than $1.4 million. In recent years, Holt’s overtime pay was over double that of her regular salary. Holt accomplished the fraud by making manual retroactive adjustments to protected computer time and attendance systems to add overtime, reverse leave taken and reverse holiday leave. In doing so, Holt used another employee’s log-in information without that employee’s knowledge or authorization.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Robert Craig, Special Agent in Charge for Defense Criminal Investigative Service Mid-Atlantic Field Office, and Colonel Kirk B. Stabler, Commander of the Air Force Office of Special Investigations, made the announcement after sentencing by U.S. District Judge Raymond A. Jackson. Assistant U.S. Attorney Brian J. Samuels prosecuted the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 4:18-cr-93.

NORFOLK, Va. – A Hampton woman was sentenced today to three years in prison and one year of home detention for conspiracy to commit wire fraud and causing false records, wire fraud, and theft of government funds.

“Brown lied about feeding needy children in our community in hopes of making a financial gain for herself,” said G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia. “We will continue to thoroughly investigate those who lie and steal from taxpayers and the federal government. I want to thank our trial team and investigative partners for their incredible work on this important case.”

According to court documents and evidence presented at trial, Shaun Brown, 60, defrauded the USDA’s summer food service program (SFSP) aimed at feeding low income children. Brown and her mother ran a non-profit company, JOBS Community Development Corporation, which served as a sponsor for the SFSP. Over the course of the 2012 Summer, Brown inflated the number of meals JOBS purportedly served to low-income children and submitted fraudulent claims for reimbursement based on the inflated numbers. Brown also orchestrated a massive scheme to falsify hundreds of documents to support her fraudulently inflated meal count numbers and ordered excessive amounts of food and milk products which she was well aware would never be used to feed needy children. At her direction, Brown’s employees disposed of this food and milk, purchased with federal funds, in large mounds behind buildings in Newport News, as well as a pig farm in Southern Virginia. As a result of her fraudulent actions, the USDA paid JOBS over $800,000 in federal funds. 

Brown ran as the Democratic candidate for the 2nd Congressional District for the U.S. House of Representatives in 2016.  Brown attempted to run again as an independent candidate in the 2018 election, but was removed from the ballot due to other fraudulent actions by Brown and others. 

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Michael C. Westfall, State Inspector General of Virginia, and Colonel Gary T. Settle, Superintendent of Virginia State Police, made the announcement after sentencing by Senior U.S. District Judge Henry Coke Morgan, Jr. Assistant U.S. Attorneys Elizabeth M. Yusi and Melissa E. O’Boyle prosecuted the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:17-cr-169.

NORFOLK, Va. – A Virginia Beach man was sentenced today to more than 11 years in prison for his role in a heroin and fentanyl distribution conspiracy that resulted in an overdose death.

According to court documents, Christopher Allen Bardall, 34, sold at least 550 grams of fentanyl, which could translate to approximately 5,500 individual doses. He did so as a part of conspiracy with Michelle Best, whose drugs killed one young woman, K.R., and caused several other non-fatal overdoses. Best was sentenced on March 14 to 30 years in prison.

Bardall was a street dealer who distributed fentanyl, supplied by Best, directly to K.R. Bardall knew the fentanyl he was dealing was strong and that it had resulted in multiple overdoses by clients of his who used it. On Dec. 17, 2017, within hours of K.R.’s coma and death, officers from the Virginia Beach Police Department located Bardall and arrested him after a vehicle and foot pursuit.

This case is part of Project Safe Neighborhoods (PSN), which is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Jesse R. Fong, Special Agent in Charge for the Drug Enforcement Administration’s (DEA) Washington Field Division, and James A. Cervera, Chief of Virginia Beach Police, made the announcement after sentencing by Chief U.S. District Judge Mark S. Davis. Assistant U.S. Attorneys John F. Butler and Andrew C. Bosse prosecuted the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:18-cr-147-3.

Lumber Liquidators Holdings Inc. (Lumber Liquidators) has agreed to pay a total penalty of $33 million for filing a materially false and misleading statement to investors regarding the sale of its laminate flooring from China to its customers in the United States.

Lumber Liquidators, a public corporation headquartered in Toano, Virginia, and one of the largest retailers of flooring products in the United States, entered into a deferred prosecution agreement (DPA) in connection with a criminal information filed today in the Eastern District of Virginia charging the company with securities fraud.  The case was primarily focused on the fact that Lumber Liquidators knowingly filed a false and misleading statement to investors broadly denying the allegations featured in a March 2015 episode of 60 Minutes, and affirming that the company complied with California Air Resources Board (CARB) regulations.

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney G. Zachary Terwilliger of the Eastern District of Virginia, Special Agent in Charge David W. Archey of the FBI’s Richmond Field Office, Special Agent in Charge Kelly R. Jackson of IRS-Criminal Investigation (IRS-CI) Washington, D.C. Field Office and Inspector in Charge Peter R. Rendina of the U.S. Postal Inspection Service Washington Division, made the announcement.

“Lumber Liquidators lied to investors and to the public about its compliance with formaldehyde regulations for the flooring it sold – all to protect its stock price,” said Assistant Attorney General Benczkowski.  “False and misleading financial reports undermine the integrity of our securities markets and harm investors.  The Department and our law enforcement partners are committed to doing everything we can to ensure that those who commit securities fraud are held accountable.”

“This resolution holds Lumber Liquidators accountable for misleading the investing public,” said U.S. Attorney Terwilliger.  “It also recognizes that the company has cooperated with the government's investigation, completely replaced its senior executive team, and installed experienced executives who have displayed a commitment to building an ethical corporate culture.  We will continue to ensure that market participants can trust information communicated by public companies when making investment decisions.  My thanks to our prosecutorial team and our investigative partners for their outstanding work on this case.” 

“This penalty should serve as a warning to other corporations who seek to mislead investors,” said FBI Special Agent in Charge Archey.  “FBI Richmond is grateful for the commitment to this case of its partners at the U.S. Attorney’s Office, the Justice Department’s Fraud Section, the IRS Criminal Investigation and the U.S. Postal Inspection Service.”

“Lumber Liquidators knowingly deceived the shareholders they were entrusted to serve,” said IRS-CI Special Agent in Charge Jackson.  “IRS-CI will continue to work diligently with our federal law enforcement partners to ensure that the punishment for such crimes matches the seriousness of the offense.”

“Those seeking to maximize profits while misleading investors should expect to pay a heavy price,” said U.S. Postal Inspector in Charge Rendina.  “The U.S. Postal Inspection Service has investigated these kind of deceptive practices for years to protect investors and the integrity of the market place.  Postal Inspectors work tirelessly to identify and hold accountable any company who uses the U.S. mail to defraud American citizens.”

According to court documents filed as part of the DPA, Lumber Liquidators was subject to various laws that regulated the chemicals used in wood products, including laminate flooring.  Specifically, CARB enforced limits on formaldehyde emissions from composite wood products.  In September 2013, CARB announced that it intended to use deconstructive testing to determine whether finished flooring products contained CARB compliant cores.  In 2013 and 2014, CARB informed Lumber Liquidators that flooring samples collected from its California stores failed deconstructive testing for formaldehyde emissions.  Lumber Liquidators’ own deconstructive tests of the same products yielded similar results.

Also in 2014, foreign and domestic flooring suppliers alerted Lumber Liquidators of CARB compliance concerns related to the company’s Chinese laminate products.  In February 2014, Lumber Liquidators’ Chinese laminate suppliers requested a price increase citing concerns about the increased cost of CARB compliant cores and their ability to pass deconstructive testing for formaldehyde emissions.  Approximately one month later, a U.S. laminate supplier informed Lumber Liquidators that it tested a Chinese laminate sample purchased from one of Lumber Liquidators’ stores in the United States and that the sample emitted high levels of formaldehyde.  Lumber Liquidators took only limited steps to determine the validity of the suppliers’ concerns, and instead sought to generate support for its position that deconstructive testing was not a valid test method, the company admitted.

To that end, Lumber Liquidators visited two Chinese laminate suppliers in August 2014 to collect and test samples.  While collecting samples from Supplier A, a then-Lumber Liquidators employee noticed a pallet of laminate flooring that factory workers indicated was Lumber Liquidators’ product, but the label on the pallet indicated that it contained non-CARB compliant cores.  The former employee took samples from this suspect pallet for testing along with other samples manufactured in his and other employees’ presence.  Laboratory A later provided Lumber Liquidators with test results that undermined the company’s criticisms of deconstructive testing.  All but one of the products manufactured in front of the Lumber Liquidators employees passed deconstructive testing.  But the samples from the suspect pallet, manufactured before employees arrived, failed deconstructive testing.

Lumber Liquidators representatives again visited Supplier A in September 2014 and January 2015.  Following these visits, Lumber Liquidators concluded that Supplier A had numerous recordkeeping anomalies, refused to implement CARB-related corrective action requests made by the company, and could not reliably demonstrate that its laminate flooring contained CARB compliant cores.  Accordingly, in January 2015, the company’s former senior management team decided to discontinue its relationship with Supplier A due to CARB compliance concerns.  Nevertheless, that same day, Lumber Liquidators admitted it ordered more laminate flooring from Supplier A.

In Fall 2014, Lumber Liquidators learned that the CBS news program, 60 Minutes, also retained Laboratory A to conduct deconstructive testing of Lumber Liquidators’ products.  Shortly thereafter, Laboratory A secretly notified Lumber Liquidators that the deconstructive tests commissioned by 60 Minutes yielded significant test failures.  The lab then allowed a former Lumber Liquidators employee to review and take pictures of these test results.  In December 2014, the lab owner told former Lumber Liquidators employees that a high deconstructive test failure was a strong indicator that the product was not CARB compliant, the company admitted. 

On Feb. 25, 2015, Lumber Liquidators learned that 60 Minutes obtained undercover videos from three of its Chinese laminate suppliers, including Supplier A, in which the suppliers admitted that the laminates they made for Lumber Liquidators were not CARB compliant.  Lumber Liquidators’ former senior management team retained outside counsel from Law Firm B to interview the suppliers in the undercover videos.  On Feb. 28, 2015, Law Firm B informed former Lumber Liquidators executives that it recorded one person from each of the three factories in the undercover videos saying that the product they sold Lumber Liquidators was CARB compliant.  Nevertheless, Law Firm B told these former executives that they had limited confidence in the suppliers’ statements because, among other things, a former Lumber Liquidators inspector alleged that suppliers offered bribes to him and other company employees, the company admitted.   

On March 1, 2015, 60 Minutes aired a segment alleging that laminate flooring sold by Lumber Liquidators in the United States did not meet CARB emission standards for formaldehyde.  The episode featured the undercover videos and test results previously shown to Lumber Liquidators.

The next morning, March 2, 2015, the New York Stock Exchange halted trading of the company’s stock, with the expectation that Lumber Liquidators intended to issue a statement responding to the 60 Minutes episode.  Later that morning, Lumber Liquidators, through its employees, knowingly filed a false and misleading Securities and Exchange Commission (SEC) Form 8-K broadly denying the allegations in the 60 Minutes episode and affirming Lumber Liquidators complied with CARB regulations, the company admitted.  Specifically, Lumber Liquidators omitted material facts from investors, including CARB’s investigation of the company’s Chinese laminate products; its own deconstructive test results; the company’s decision to discontinue sourcing from Supplier A due to CARB compliance concerns; and evidence that undermined the suppliers’ statements that all products provided to Lumber Liquidators were CARB compliant.

Pursuant to its agreement with the Department of Justice, Lumber Liquidators agreed to pay a total criminal penalty of $33 million to the United States, including a criminal fine of approximately $19 million, and approximately $14 million in forfeiture.  This amount represents the company’s net profits from the sale of 100 percent of its Chinese laminate from approximately Jan. 16, 2015 through May 7, 2015.

Lumber Liquidators also agreed to implement rigorous internal controls and cooperate fully with the Department’s ongoing investigation, including its investigation of individuals.  Under the DPA, prosecution of the company for securities fraud will be deferred for an initial period of three years to allow Lumber Liquidators to demonstrate good conduct.

The SEC announced a separate settlement with Lumber Liquidators in connection with related, parallel proceedings.  Under the terms of its resolution with the SEC, Lumber Liquidators agreed to a total of $6,097,298.42 in disgorgement of profits and prejudgment interest.  The Department of Justice agreed to credit the amount paid to the SEC in disgorgement as part of its agreement.  Thus, the combined total amount of criminal and regulatory penalties paid by Lumber Liquidators will be $33 million.

This penalty reflects the nature and seriousness of the conduct, as well as Lumber Liquidators’ ongoing cooperation with the United States and the company’s extensive efforts at remediation.  Among other remedial efforts, Lumber Liquidators suspended the sale of all laminate flooring from China in May 2015; offered consumers in-home testing for already installed flooring; and implemented new policies and procedures regarding compliance with CARB emission standards and other environmental regulations, sourcing of flooring products, financial reporting and internal controls.  The employees involved in wrongdoing either were terminated or resigned from Lumber Liquidators, and the company replaced its executive management team with experienced executives who have displayed a commitment to building an ethical corporate culture.      

Trial Attorney Cory E. Jacobs of the Criminal Division’s Fraud Section and Assistant U.S. Attorneys Katherine Lee Martin and Uzo E. Asonye of the Eastern District of Virginia prosecuted the case. 

The Criminal Division’s Fraud Section plays a pivotal role in the Department of Justice’s fight against white collar crime around the country.

RICHMOND, Va. – Lumber Liquidators Holdings, Inc. has agreed to pay a total penalty of $33 million for filing a materially false and misleading statement to investors regarding the sale of its laminate flooring from China to its customers in the United States.

“This resolution holds Lumber Liquidators accountable for misleading the investing public,” said G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia. “It also recognizes that the company has cooperated with the government's investigation, completely replaced its senior executive team, and installed experienced executives who have displayed a commitment to building an ethical corporate culture. We will continue to ensure that market participants can trust information communicated by public companies when making investment decisions. My thanks to our prosecutorial team and our investigative partners for their outstanding work on this case.” 

Lumber Liquidators, a public corporation headquartered in Toano and one of the largest retailers of flooring products in the United States, entered into a deferred prosecution agreement (DPA) in connection with a criminal information filed today charging the company with securities fraud. The case was primarily focused on the fact that Lumber Liquidators knowingly filed a false and misleading statement to investors broadly denying the allegations featured in a March 2015 episode of 60 Minutes, and affirming that the company complied with California Air Resources Board (CARB) regulations.

“Lumber Liquidators lied to investors and to the public about its compliance with formaldehyde regulations for the flooring it sold – all to protect its stock price,” said Brian A. Benczkowski, Assistant Attorney General of the Justice Department’s Criminal Division. “False and misleading financial reports undermine the integrity of our securities markets and harm investors. The Department and our law enforcement partners are committed to doing everything we can to ensure that those who commit securities fraud are held accountable.”

According to court documents filed as part of the DPA, Lumber Liquidators was subject to various laws that regulated the chemicals used in wood products, including laminate flooring. Specifically, CARB enforced limits on formaldehyde emissions from composite wood products. In September 2013, CARB announced that it intended to use deconstructive testing to determine whether finished flooring products contained CARB compliant cores. In 2013 and 2014, CARB informed Lumber Liquidators that flooring samples collected from its California stores failed deconstructive testing for formaldehyde emissions. Lumber Liquidators own deconstructive tests of the same products yielded similar results.

“This penalty should serve as a warning to other corporations who seek to mislead investors,” said David W. Archey, Special Agent in Charge of the FBI’s Richmond Field Office. “FBI Richmond is grateful for the commitment to this case of its partners at the U.S. Attorney’s Office, the Justice Department’s Fraud Section, IRS Criminal Investigations and the U.S. Postal Inspection Service.”

Also in 2014, foreign and domestic flooring suppliers alerted Lumber Liquidators of CARB compliance concerns related to the company’s Chinese laminate products. In February 2014, Lumber Liquidators’ Chinese laminate suppliers requested a price increase citing concerns about the increased cost of CARB compliant cores and their ability to pass deconstructive testing for formaldehyde emissions. Approximately one month later, a United States laminate supplier informed Lumber Liquidators that it tested a Chinese laminate sample purchased from one of Lumber Liquidators’ stores in the United States and that the sample emitted high levels of formaldehyde. Lumber Liquidators took only limited steps to determine the validity of the suppliers’ concerns, and instead sought to generate support for its position that deconstructive testing was not a valid test method.

“Lumber Liquidators knowingly deceived the shareholders they were entrusted to serve,” said Kelly R. Jackson, Special Agent in Charge of IRS-Criminal Investigation (IRS-CI) Washington, D.C. Field Office. “IRS-CI will continue to work diligently with our federal law enforcement partners to ensure that the punishment for such crimes matches the seriousness of the offense.”

To that end, Lumber Liquidators visited two Chinese laminate suppliers in August 2014 to collect and test samples. While collecting samples from Supplier A, a former Lumber Liquidators employee noticed a pallet of laminate flooring that factory workers indicated was Lumber Liquidators’ product, but the label on the pallet indicated that it contained non-CARB compliant cores. The former employee took samples from this suspect pallet for testing along with other samples manufactured in his and other employees’ presence. Laboratory A later provided Lumber Liquidators with test results that undermined the company’s criticisms of deconstructive testing. All but one of the products manufactured in front of the Lumber Liquidators’ employees passed deconstructive testing. But the samples from the suspect pallet, manufactured before employees arrived, failed deconstructive testing.

“Those seeking to maximize profits while misleading investors should expect to pay a heavy price,” said Peter R. Rendina, Inspector in Charge of the Washington Division of the U.S. Postal Inspection Service. “The U.S. Postal Inspection Service has investigated these kinds of deceptive practices for years to protect investors and the integrity of the marketplace. Postal Inspectors work tirelessly to identify and hold accountable any company who uses the U.S. mail to defraud American citizens.”

Lumber Liquidators again visited Supplier A in September 2014 and January 2015. Following these visits, Lumber Liquidators concluded that Supplier A had numerous recordkeeping anomalies, refused to implement CARB-related corrective action requests made by the company, and could not reliably demonstrate that its laminate flooring contained CARB compliant cores. Accordingly, in January 2015, the company’s former senior management team decided to discontinue its relationship with Supplier A due to CARB compliance concerns. Nevertheless, that same day, Lumber Liquidators ordered more laminate flooring from Supplier A.

In Fall 2014, Lumber Liquidators learned that the CBS news program, 60 Minutes, also retained Laboratory A to conduct deconstructive testing of Lumber Liquidators’ products. Shortly thereafter, Laboratory A secretly notified Lumber Liquidators that the deconstructive tests commissioned by 60 Minutes yielded significant test failures. The lab then allowed a former Lumber Liquidators employee to review and take pictures of these test results. In December 2014, the lab owner told former Lumber Liquidators employees that a high deconstructive test failure was a strong indicator that the product was not CARB compliant. 

On Feb. 25, 2015, Lumber Liquidators learned that 60 Minutes obtained undercover videos from three of its Chinese laminate suppliers, including Supplier A, in which the suppliers admitted that the laminates they made for Lumber Liquidators were not CARB compliant. Lumber Liquidators’ former senior management team retained outside counsel from Law Firm B to interview the suppliers in the undercover videos. On Feb. 28, 2015, Law Firm B informed former Lumber Liquidators executives that it recorded one person from each of the three factories in the undercover videos saying that the product they sold Lumber Liquidators was CARB compliant. Nevertheless, Law Firm B told these former executives that they had limited confidence in the suppliers’ statements because, among other things, a former Lumber Liquidators inspector alleged that suppliers offered bribes to him and other company employees.   

On March 1, 2015, 60 Minutes aired a segment alleging that laminate flooring sold by Lumber Liquidators in the United States did not meet CARB emission standards for formaldehyde. The episode featured the undercover videos and test results previously shown to Lumber Liquidators.

The next morning, March 2, 2015, the New York Stock Exchange halted trading of the company’s stock, with the expectation that Lumber Liquidators intended to issue a statement responding to the 60 Minutes episode. Later that morning, Lumber Liquidators, through its employees, knowingly filed a false and misleading SEC Form 8-K broadly denying the allegations in the 60 Minutes episode and affirming Lumber Liquidators complied with CARB regulations. Specifically, Lumber Liquidators omitted material facts from investors, including: CARB’s investigation of the company’s Chinese laminate products; its own deconstructive test results; the company’s decision to discontinue sourcing from Supplier A due to CARB compliance concerns; and evidence that undermined the suppliers’ statements that all products provided to Lumber Liquidators were CARB compliant.

Pursuant to its agreement with the Department of Justice, Lumber Liquidators agreed to pay a total criminal penalty of $33 million to the United States, including a criminal fine of approximately $19 million, and approximately $14 million in forfeiture. This amount represents the company’s net profits from the sale of 100 percent of its Chinese laminate from on or about Jan. 16, 2015 through on or about May 7, 2015.

Lumber Liquidators also agreed to implement rigorous internal controls and cooperate fully with the Department’s ongoing investigation, including its investigation of individuals. Under the DPA, prosecution of the company for securities fraud will be deferred for an initial period of three years to allow Lumber Liquidators to demonstrate good conduct.

The U.S. Securities and Exchange Commission (SEC) announced a separate settlement with Lumber Liquidators in connection with related parallel proceedings. Under the terms of its resolution with the SEC, Lumber Liquidators agreed to a total of $6,097,298.42 in disgorgement of profits and prejudgment interest. The Department of Justice agreed to credit the amount paid to the SEC in disgorgement as part of its agreement. Thus, the combined total amount of criminal and regulatory penalties paid by Lumber Liquidators will be $33 million.

This penalty reflects the nature and seriousness of the conduct, as well as Lumber Liquidators’ ongoing cooperation with the United States and the company’s extensive efforts at remediation.  Among other remedial efforts, Lumber Liquidators suspended the sale of all laminate flooring from China in May 2015; offered consumers in-home testing for already installed flooring; and implemented new policies and procedures regarding compliance with California Air Resources Board (CARB) emission standards and other environmental regulations, sourcing of flooring products, financial reporting and internal controls. The employees involved in wrongdoing either were terminated or resigned from Lumber Liquidators, and the company replaced its executive management team with experienced executives who have displayed a commitment to building an ethical corporate culture.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia; David W. Archey, Special Agent in Charge of the FBI’s Richmond Field Office; Kelly R. Jackson, Special Agent in Charge, Washington, D.C. Field Office, IRS-Criminal Investigation (IRS-CI), and Peter R. Rendina, Inspector in Charge of the Washington Division of the U.S. Postal Inspection Service, made the announcement. Assistant U.S. Attorneys Katherine Lee Martin and Uzo Asonye, and Trial Attorney Cory E. Jacobs of the Criminal Division’s Fraud Section are prosecuting the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. X:XX-cr-XXX.

NEWPORT NEWS, Va. – A federal jury convicted two men late yesterday on charges of conspiracy to distribute heroin, crack cocaine, and fentanyl, and possession with intent to distribute heroin.

“Armed drug traffickers pose serious threats to the safety of our communities,” said G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia. “The tactical acumen and flexible execution demonstrated by the joint task force in this case is testament to its keen leadership and depth of experience. Through quick thinking, decisive action and fluid coordination, a simple surveillance operation suddenly escalated into an unexpected but successful vehicle interdiction and drug trafficking arrest. This investigation and prosecution would not have been possible absent the critical partnerships we have formed with our local and federal law enforcement partners. My thanks to Homeland Security Investigations, and the Hampton and Newport News Police Departments for their outstanding work on this case.”

According to court records and evidence presented at trial, Terrence Dennis 37, of Norfolk, and Michael Guess, 36, of Newport News, caught the attention of law enforcement when they walked into an ongoing surveillance operation by a Homeland Security Investigations Task Force. After the tactical decision was made to observe Guess (driver) and Dennis (passenger), Guess failed to obey a stop sign, and agents attempted a traffic stop for the minor infraction. Guess accelerated and led the task force on a dangerous high-speed pursuit through Hampton and Newport News while his co-conspirator Dennis threw a loaded firearm and 33 grams of heroin out of the passenger window. Once detained, additional controlled substances and evidence of narcotics distribution was seized. The loaded firearm and heroin jettisoned during the chase were also recovered.

“Narcotics. Guns. A high-speed chase. This case had all the makings of a suspenseful movie plot. Unfortunately, it wasn’t part of a fictional storyline; it is the grim reality our agents and task force officers face right here in Hampton Roads,” said Michael K. Lamonea, Assistant Special Agent in Charge of Homeland Security Investigations’ Norfolk and Richmond offices. “I commend the task force for its quick actions. The arrests of these two individuals helped law enforcement remove lethal narcotics, as well as a firearm from our community.”   

This case is part of Project Safe Neighborhoods (PSN), which is the centerpiece of the Department of Justice’s violent crime reduction efforts.  PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.

Dennis, who was also convicted of being a felon in possession of a firearm, faces a mandatory minimum sentence of five years to life imprisonment consecutive to any additional sentence imposed for his multiple convictions when sentenced on June 19. Guess faces a maximum penalty of 20 years in prison when sentenced on June 20. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Michael K. Lamonea, Assistant Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Norfolk, Terry L. Sult, Chief of Hampton Police Division, and Steve R. Drew, Chief of Newport News Police, made the announcement after Chief U.S. District Judge Mark S. Davis accepted the verdict. Assistant U.S. Attorneys Howard J. Zlotnick and Peter G. Osyf are prosecuting the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 4:18-cr-72.

RICHMOND, Va. – A Maryland man pleaded guilty today to possessing suboxone, a Schedule III controlled substance, while in federal prison.

According to court documents, James Pixley, 29, of Leonardtown, was in the visiting area of the Petersburg Federal Correctional Institution in July 2018 when he received 35 12mg suboxone strips from a visitor. Suboxone is a controlled substance that is available only by prescription. Prison officials recovered the suboxone from Pixley immediately after the visit. 

Pixley pleaded guilty to possession of a prohibited object by a federal inmate and faces a maximum penalty of 5 years in prison when sentenced on April 9. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, David W. Archey, Special Agent in Charge of the FBI’s Richmond Field Office, and John I. Dixon III, Chief of Petersburg Police, made the announcement after Senior U.S. District Judge Henry E. Hudson accepted the plea. Assistant U.S. Attorney Angela Mastandrea-Miller is prosecuting the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:19-cr-011.

ALEXANDRIA, Va. – A Springfield man was sentenced today to total of 16 years in prison and a lifetime of supervised release for receipt of child pornography and a supervised release violation.

According to court documents, William Hemphill, 39, admitted that he downloaded thousands of images and videos of child pornography in February and March 2018. Hemphill, who is currently serving a term of federal supervised release as part of his sentence for an earlier 2006 conviction for possession of child pornography, fled from supervision in Virginia in February 2018. He was arrested in Utah aboard a California-bound train in March 2018, in possession of cocaine and several electronic devices, including a laptop computer. A subsequent forensic examination of these devices revealed that Hemphill had used multiple anonymous Internet services to download and view large quantities of child pornography while on the run in Virginia and elsewhere.

This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Robert Mathieson, U.S. Marshal for the Eastern District of Virginia, and Matthew J. DeSarno, Special Agent in Charge, Criminal Division, FBI Washington Field Office, made the announcement after sentencing by Senior U.S. District Judge T.S. Ellis III. Assistant U.S. Attorney Whitney Dougherty Russell and Special Assistant U.S. Attorney William G. Clayman prosecuted the case.

This case was initiated and investigated by the FBI’s Washington Field Office’s Child Exploitation and Human Trafficking Task Force, which is composed of FBI Agents, along with Detectives from the Washington Metropolitan Police Department, Fairfax County Police, Arlington County Police, Prince William County Police, Alexandria City Police, Loudoun County Sheriff’s Department, Leesburg Police Department, USMS and other federal Offices of Inspector Generals. Additional assistance in this case was provided by the FBI’s Salt Lake Field Office, the United States Marshal’s Office, and the United States Probation and Pretrial Services in the District of Utah.

The U.S. Attorney’s Office for the District of Utah provided significant assistance.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:18-cr-414.

ALEXANDRIA, Va. – An Upperville man was sentenced today to 30 days in prison and one year of supervised release for selling endangered species and other wildlife parts that were illegally imported into the United States.

According to court documents, Keith R. Foster, 60, is a golf course architect who also operated a store in Middleburg known as “the Outpost.” Between 2014 and 2018, Foster imported at least 35 separate shipments of merchandise for resale at the Outpost, some of which contained wildlife and wildlife parts, but he failed to declare any of the wildlife within those shipments to the U.S. Fish and Wildlife Service upon import, as required by law. To conceal the existence of wildlife pieces in the shipments and evade detection by the U.S. Fish and Wildlife Service, he caused many pieces to be labeled in a manner that obscured their true nature. Foster then sold at his store the wildlife pieces that he illegally imported.

During the five-year period in question, Foster sold nearly $400,000 worth of items that constituted or contained parts of endangered species and other wildlife that he illegally imported into the United States. These items included Endangered Species Act items such as sawfish blades, crocodile skin bags, wallets and flasks, and handicrafts made of sea turtle shell.

In a telephone call with a customer in January 2017, Foster admitted that he should not be importing sawfish blades. Foster stated, “Rest assured, I’m gonna bring more in, ‘cause I’m the only fool in the States that probably wants to risk it.”

In December 2018, Foster was ordered to perform 50 hours of community service, forfeit scores of individual pieces of wildlife and wildlife parts, and ordered to forfeit $275,000. 

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, and Edward Grace, Assistant Director of Law Enforcement for the U.S. Fish and Wildlife Service, made the announcement after sentencing by U.S. District Judge Leonie M. Brinkema. Assistant U.S. Attorney Gordon D. Kromberg prosecuted the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:18-cr-456.

ALEXANDRIA, Va. – A Honduran national pleaded guilty today to multiple cocaine and firearms trafficking charges.

According to court documents, Reyes Barrera Alachan, 38, sold a total of about 3/4 of a kilogram of cocaine to undercover law enforcement over the course of about six months. Alachan traveled from his residence in Maryland to North Carolina at least every other weekend to meet his sources of supply and obtain cocaine, which he redistributed to his customers in the greater Washington, DC metropolitan area. Alachan and his co-conspirators used coded language to communicate about drugs, such as the word “tires” to refer to cocaine, and “fajitas” to refer to methamphetamine. 

In addition to his involvement in distributing cocaine, Alachan was also involved in illegal distribution of firearms, and sold a total of six firearms, as well as magazines and ammunition, to undercover law enforcement. The firearms he sold included semi-automatic weapons capable of carrying large-capacity magazines. When Alachan was arrested, law enforcement found him in possession of 5 ounces of cocaine, 4 grams of methamphetamine, drug paraphernalia, and gun ammunition.

Alachan pleaded guilty to conspiracy to distribute 500 grams or more of cocaine, distribution of cocaine, and one count of engaging in the business of dealing firearms without a license. He faces a mandatory minimum sentence of five years in prison when sentenced on June 28. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.

The case was investigated as part of the Organized Crime Drug Enforcement Task Forces (OCDETF) Operation Tomb Stone.  The OCDETF program is a federal multi-agency, multi-jurisdictional task force that supplies supplemental federal funding to federal and state agencies involved in the identification, investigation, and prosecution of major drug trafficking organizations.  The principal mission of the OCDETF program is to identify, disrupt, and dismantle the most serious drug trafficking, weapons trafficking, and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of a renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Matthew J. DeSarno, Special Agent in Charge of the Criminal Division at the Washington Field Office, Jesse R. Fong, Special Agent in Charge for the Drug Enforcement Administration’s (DEA) Washington Field Division, and Barry M. Barnard, Chief of Prince William County Police, made the announcement after U.S. District Judge Claude M. Hilton accepted the plea. Assistant U.S. Attorneys Katherine E. Rumbaugh and James P. Gillis are prosecuting the case.

This investigation was led by FBI Washington Field Office’s Safe Streets/HIDTA Task Force. The Task Force is composed of FBI Agents along with investigators from the Prince William County Police, the Fairfax County Police, the Loudoun County Sheriff’s Office, Leesburg Police Department, Alexandria City Police, Vienna Police, Herndon Police and ICE. Significant assistance was provided by the Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATF) Washington Field Division, FBI’s Charlotte Field Office, DEA’s Greensboro Resident Agency, and the Police Departments of Sanford, North Carolina and Fayetteville, North Carolina.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case Nos. 1:18-cr-380 and 1:19-cr-73.

ALEXANDRIA, Va. – A previously convicted felon was arrested last night on charges related to defrauding investors of a local newspaper, unlawful possession of firearms by a previously convicted felon, and making false statements to the FBI.

According to allegations in the indictments, Brian Thomas Reynolds, 52, of Leesburg, defrauded both investors and lenders to a company that he controlled that operates a local newspaper in Loudoun County. As alleged in that indictment, Reynolds made several materially false and fraudulent representations to actual and potential investors and lenders regarding the existence and value of advertising contracts held by the company, and created fake advertising contracts when no such agreements existed. Reynolds also allegedly made materially false and fraudulent representations regarding the company’s historical advertising revenues and the amount of money that Reynolds and others had invested in the company, falsely claimed that another individual had agreed to “match” the investments of certain investors, falsely claimed to at least one investor that the company lacked any debt, understated the amount of debt owed by the company to other investors, and materially overstated the amount of money held by the company in its bank accounts. 

The indictment further alleges that Reynolds created altered loan documentation to defraud an individual who had lent money to the company by changing the language of the loan agreement to conditions that were materially more favorable to Reynolds and his company than had actually been agreed to by the lender. According to the indictment, Reynolds also made materially false representations regarding the number of issues previously distributed by the newspaper, and falsely claimed that a prominent businessperson served on the company’s advisory board, when in fact that individual held no position on the board and played no role in the operation of the business.

A second indictment charges Reynolds, who is a convicted felon, with unlawfully possessing eight firearms and associated ammunition, and with making false statements to the FBI regarding his use of firearms.

Reynolds is charged with 11 counts of wire fraud, one count of unlawful possession of firearms by a convicted felon, and one count of making false statements. If convicted, he faces a maximum penalty of 20 years in prison for each count of wire fraud, a maximum penalty of 10 years in prison for the unlawful possession of firearms, and a maximum penalty of 5 years in prison for making false statements. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.

This case is part of Project Safe Neighborhoods (PSN), which is the centerpiece of the Department of Justice’s violent crime reduction efforts.  PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, and Matthew J. DeSarno, Special Agent in Charge, Criminal Division, FBI Washington Field Office, made the announcement. Assistant U.S. Attorney Matthew Burke and Special Assistant U.S. Attorney Russell L. Carlberg are prosecuting the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case Nos. 1:19-cr-70 and 1:19-cr-71.

An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until and unless proven guilty in court.

RICHMOND, Va. – Over 150 law enforcement agents and officers executed a coordinated takedown this morning in Petersburg, arresting seven individuals on various drug and firearms charges including heroin, fentanyl, and cocaine distribution and possession of a firearm by a convicted felon. An eighth individual was arrested in Texas and a ninth individual was already in custody on state charges.

“This operation represents our commitment to public safety in Petersburg,” said G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia. “Illegal firearms and drugs are often driving forces behind the violent crime that we are addressing in communities across the Eastern District. The actions taken today reflect the coordinated, skilled and brave work of law enforcement, and I want to thank the ATF and the Petersburg Bureau of Police for their partnership and commitment to reducing violent crime in Petersburg. These are serious allegations and each defendant is presumed to be innocent until and unless proven guilty in court.”

“What we see today is the fruit of the strong partnership between ATF and the Petersburg Bureau of Police,” said Ashan Benedict, Special Agent in Charge of the ATF’s Washington Field Division. “Going forward, ATF will continue to stand alongside the City of Petersburg and stay committed to targeting those who commit violent crimes and illegally possess firearms.”

“Today is a great day for our city,” said Kenneth Miller, Chief of Petersburg Bureau of Police. “The Petersburg Bureau of Police is committed to keeping our streets safe and making the City of Petersburg a better place to live. I’m extremely appreciative of our strong relationship with the ATF and our federal partners, and I look forward to continuing to work together to target those who choose to break the law. Today’s enforcement activity is a great example of our strategic approach going forward.”

Below is a table which lists the name, age, hometown, and respective charge(s) each defendant faces.

Name, Age

Hometown

Charge(s)

Armon Lee, 26

Warfield

Sale or Disposal of a Firearm to a Convicted Felon; Distribution of Cocaine

Terrell Dean Johnson, 30

Petersburg

Distribution of Cocaine

Titus Maurice Lee, 44

Petersburg

Distribution of Cocaine; Distribution of Heroin and/or Fentanyl; Possession of a Firearm/Ammunition by a Convicted Felon; Sale or Disposal of a Firearm to a Convicted Felon

Autrelle Malik Waddell, 22

Petersburg

Distribution of Heroin and/or Fentanyl; Sale or Disposal of a Firearm to a Convicted Felon

Miles Owanga Johnson, 39

 

Petersburg

Distribution of Heroin and/or Fentanyl

Charles Lee Avery, 44

 

Petersburg

Possession of a Firearm/Ammunition by a Convicted Felon

Tyrell Jakahree Allen, 26

 

Prince George

Distribution of Cocaine

Vincent Edward Stewart, 29

 

Petersburg

Sale or Disposal of a Firearm to a Convicted Felon

Calvin Alphonso Turner, 32

 

Petersburg

Distribution of Cocaine

This case is part of Project Safe Neighborhoods (PSN), which is the centerpiece of the Department of Justice’s violent crime reduction efforts.  PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Ashan M. Benedict, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATF) Washington Field Division, and Kenneth A. Miller, Director of Public Safety, Petersburg Bureau of Police, made the announcement. Assistant U.S. Attorneys Angela Mastandrea-Miller and Peter S. Duffey are prosecuting the cases.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER.

An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until and unless proven guilty in court.

ALEXANDRIA, Va. – A former federal contractor pleaded guilty today to theft and embezzlement of up to 16 government computers from the U.S. Department of State.     

According to court documents, Andrew W. Cheveers, 31, of Bowie, Maryland, was an Information Technology contractor for the State Department’s Office of Inspector General. In this role, Cheveers held a security clearance that allowed him access to certain sensitive information, and he was responsible for configuring the computers prior to the devices being distributed to U.S. government personnel.

Through the course of his criminal conduct, Cheevers admitted to stealing up to 16 Microsoft Surface Pro laptop computers. Cheveers then sold the stolen computers on Internet websites such as Craigslist and eBay from approximately July 2016 through February 2017 in order to profit from his fraudulent scheme.  

Cheveers faces a maximum penalty of 10 years in prison when sentenced on June 21. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, and Steve A. Linick, Inspector General for the Department of State, made the announcement after Senior U.S. District Judge Claude M. Hilton accepted the plea.  Assistant U.S. Attorney Raj Parekh and Special Assistant U.S. Attorney Katherine Celeste are prosecuting the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:19-cr-64.

RICHMOND, Va. – A real estate broker in Colonial Heights has agreed to settle allegations that he induced a low-income tenant to pay additional money for rent not permitted under a U.S. Department of Housing and Urban Development (HUD) rent subsidy program in which he was participating.

Harold Joseph Tyler, owner of Tyler Realty Group, participates in the federally-funded Housing Choice Voucher Program, a program for low-income individuals administered by HUD. In return for participating, Tyler receives a portion of the rent from housing assistance funds from HUD. The United States alleged that Mr. Tyler violated the federal False Claims Act (FCA) by certifying that he would not receive any payments in excess of the agreed rent. However, Tyler Realty Group, for a period of approximately 72 months, collected $190 per month from the tenant over and above the rent in the form of a monthly “non-refundable deposit.”

A qui tam action under the FCA is commenced by an individual, known as a “relator,” filing a complaint under seal in U.S. District Court, and providing a copy of the complaint and other evidence to the local U.S. Attorney. The United States then has an opportunity to investigate the claims. The relator in this case was the tenant who leased the residence and paid the excess amounts to Tyler Realty Group.

The resolutions obtained in this matter were the result of a coordinated effort between the U.S. Attorney's Office for the Eastern District of Virginia, and the Department of Housing and Urban Development, Office of Inspector General.

The matter was investigated by Assistant U.S. Attorney Robert McIntosh. The civil claims settled by this False Claims Act agreement are allegations only; there has been no determination of civil liability.

A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia.

RICHMOND, Va. – A Henrico man pleaded guilty today to trafficking over 200 grams of heroin and for possessing a firearm as a convicted felon. 

“Drug traffickers in possession of firearms pose a significant threat to our communities,” said G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia. “Investigating and prosecuting heroin and fentanyl trafficking crimes is a top priority of this office as we continue to battle this deadly epidemic. We are committed to our mission of public safety and will continue to aggressively pursue those who choose to endanger the safety of the communities we serve.”

According to court documents, Mervin Turner, 37, distributed heroin and fentanyl to a confidential source from his Henrico County residence on two separate occasions in 2018.  On August 28, 2018,   law enforcement executed a search warrant at Turner’s residence and recovered a semi-automatic pistol loaded with a 100-round drum magazine, more than 200 grams of heroin, two stand-up shop presses used to package heroin, marijuana, digital scales, and more than $9000. 

Turner pleaded guilty to possession with the intent to distribute 100 grams or more of heroin. Turner faces a mandatory minimum of 5 years in prison and maximum penalty of 40 years in prison when sentenced on June 10. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.

Operation California Dreamin was investigated as part of the Organized Crime and Drug Enforcement Task Force (OCDETF). The OCDETF program is a federal multi-agency, multi-jurisdictional task force that supplies supplemental federal funding to federal and state agencies involved in the identification, investigation, and prosecution of major drug trafficking organizations. The principal mission of the OCDETF program is to identify, disrupt, and dismantle the most serious drug trafficking, weapons trafficking, and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.

This case is part of Project Safe Neighborhoods (PSN), which is the centerpiece of the Department of Justice’s violent crime reduction efforts.  PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Jesse R. Fong, Special Agent in Charge for the Drug Enforcement Administration’s (DEA) Washington Field Division, and William C. Smith, Interim Chief of Richmond Police, made the announcement after U.S. District Judge John A. Gibney, Jr. accepted the plea. Assistant U.S. Attorneys Erik S. Siebert and Kenneth Simon are prosecuting the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:18-cr-158.

NORFOLK, Va. – A former U.S. Navy sailor was sentenced today to two and a half years in prison for trafficking at least 60 firearms, including several firearms that ended up in the hands of prohibited persons.

“Pino used his military discount to illegally traffick at least 60 firearms,” said G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia. “This case is a prime example of our conscious effort to aggressively pursue this criminal conduct which puts illegally straw purchased firearms into the hands of prohibited persons. Together with our law enforcement partners we remain committed to our mission of public safety and will continue to aggressively pursue those who choose to endanger the safety of the communities we serve.”

According to court documents, Julio Fernando Pino, 26, used his military discount to purchase and resell firearms at a profit without a federal license to do so. From November 2015 to January 2017, Pino purchased at least 60 firearms and resold at least 23 firearms at a profit, despite being told by ATF agents multiple times to stop selling these firearms. Several of the firearms fell into the hands of prohibited persons, such as felon gang members and juveniles, and were later linked to violent crimes.

This case is part of Project Safe Neighborhoods (PSN), which is the centerpiece of the Department of Justice’s violent crime reduction efforts.  PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, and Ashan M. Benedict, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATF) Washington Field Division, made the announcement after sentencing by Senior U.S. District Judge Robert G. Doumar. Assistant U.S. Attorney William B. Jackson prosecuted the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:17-cr-70.

NORFOLK, Va. – A Franklin man was sentenced today to more than seven years in prison for his role in a conspiracy to straw-purchase firearms.

According to court documents, Khary Deshun Smith, 25, and several co-defendants were members of a conspiracy that straw-purchased at least seven firearms from federally licensed firearms dealers in Franklin.

Smith, who was prohibited from possessing firearms due to earlier federal felony convictions, illegally purchased a firearm with the assistance of his co-defendant, Larry Parrish, who straw-purchased the firearm from a federally licensed gun store. In another instance, Smith stole a firearm from his girlfriend, loaded it with an extended magazine, and used it in a firefight with enemy gang members. When law enforcement executed the arrest warrant issued in this case, they discovered a third firearm tucked under a chair cushion in Smith’s living room within arms’ reach of minors.

This case is part of Project Safe Neighborhoods (PSN), which is the centerpiece of the Department of Justice’s violent crime reduction efforts.  PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia; Ashan M. Benedict, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATF) Washington Field Division; Michael K. Lamonea, Assistant Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Norfolk; and Robert Porti, Deputy Chief of the City of Franklin Police Department, made the announcement after sentencing by Senior U.S. District Judge Robert G. Doumar. Assistant U.S. Attorney William B. Jackson prosecuted the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:18-cr-150-2.

ALEXANDRIA, Va. – A South American couple were each sentenced today to nearly two years in prison for conspiracy to commit wire and bank fraud.

According to court documents, Rodrigo Pardo, 46, of Argentina, and Lorena Medina, 46, of Ecuador, defrauded homeowners in Northern Virginia and mortgage lenders by promising the homeowners to assist them in obtaining loan modifications. As part of the scheme, Pardo and Medina agreed to negotiate with the homeowners’ lenders for a reduced monthly payment. Pardo and Medina then instructed clients who were current on their mortgages to stop making payments to their lenders as they had in the past, and instead make payments into accounts controlled by Medina, Pardo, or COFS, a company they controlled. At the same time, Pardo and Medina represented to their clients’ mortgage lenders that COFS was authorized to negotiate loan modifications, but concealed from the mortgage lenders that they were receiving mortgage payments from the victims. As a result, Pardo and Medina received over $140,000 in payments from their victims, which they used for personal expenses.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Matthew J. DeSarno, Special Agent in Charge, Criminal Division, FBI Washington Field Office, and Robert Manchak, Acting Special Agent in Charge, Office of Inspector General for the Federal Housing Finance Agency, made the announcement after sentencing by Senior U.S. District Judge T.S. Ellis III. Assistant U.S. Attorney Kimberly R. Pedersen and Special Assistant U.S. Attorney Charlie Divine prosecuted the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:18-cr-181.

A Maryland contractor pleaded guilty today to defrauding a large, international labor union, announced Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney G. Zachary Terwilliger of the Eastern District of Virginia, Inspector General Scott S. Dahl of the U.S. Department of Labor’s Office of the Inspector General and Director Arthur F. Rosenfeld of the U.S. Department of Labor’s Office of Labor-Management Standards.

Howard W. Janoske, 74, of Oakland, Maryland, pleaded guilty to one count of conspiracy to commit honest services wire fraud and theft and embezzlement of labor union funds before U.S. District Judge Liam O’Grady of the Eastern District of Virginia.  Sentencing is scheduled for July 12, 2019.  

According to admissions made in connection with his plea, Janoske is the president and co-owner of a plumbing and heating, ventilation, and air conditioning contractor located in Maryland.  For nearly two decades, Janoske’s company has provided maintenance services to an international labor union located in Herndon, Virginia.  Between in or about May 2012 and at least in or about mid-2015, Janoske and his company provided the union’s facilities and real estate manager with tens of thousands of dollars in kickbacks in exchange for the awarding of the union’s service agreements and maintenance contracts.  The benefits included a high-end outdoor kitchen and free HVAC and plumbing services for the union manager and a relative over a multi-year period.  With the union manager’s knowledge, Janoske and his subordinates submitted inflated and fraudulent invoices to the union to recoup expenses for these personal benefits.

The Department of Labor’s Office of Inspector General and the Office of Labor-Management Standards investigated the case.  Trial Attorney Edward P. Sullivan of the Criminal Division’s Public Integrity Section is prosecuting the case. 

RICHMOND, Va. – A Guatemalan man was sentenced yesterday to two years in prison for illegally reentering the United States after being deported at taxpayer expense.

“Perez-Augustin is a previously convicted felon who reentered the United States illegally and was ultimately arrested for aggravated sexual battery,” said G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia. “Individuals like Perez-Augustin represent a clear threat to the safety and security of our communities, and as such we will continue to prioritize criminal immigration enforcement cases across the Eastern District of Virginia.” 

According to court documents, Hugo Perez-Augustin, 38, first illegally entered the United States in 2006 near Roma, Texas. At that time, he was removed to Guatemala. At some point after his 2006 removal, he reentered the United States illegally. Authorities discovered Perez-Augustin’s illegal presence in the United States in 2014, when he was arrested and convicted of aggravated sexual battery. Perez-Augustin will again be deported at taxpayer expense following his release from federal prison.

“This individual not only entered the country illegally on more than one occasion, but then proceeded to commit egregious crimes while in the U.S.,” said Jeffrey M. Jacoff, Acting Field Office Director for U.S. Immigration and Customs Enforcement’s Enforcement and Removal Operations Washington, D.C. “ICE will continue to prioritize public safety threats who have no regard for the nation’s immigration laws.”

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, and Jeffrey M. Jacoff, Acting Field Office Director for U.S. Immigration and Customs Enforcement’s (ICE) Enforcement and Removal Operations (ERO) Washington, D.C., made the announcement after sentencing by Senior U.S. District Judge Henry E. Hudson. Assistant U.S. Attorney Heather H. Mansfield prosecuted the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:18-cr-132.

RICHMOND, Va. – A Richmond man was sentenced today to almost three years in prison for charges of unauthorized access to a protected computer and aggravated identity theft.

According to court documents, Christopher Brannan, 31, intentionally accessed without authorization Internet and email accounts, including Apple iCloud, Yahoo!, and Facebook accounts, and obtained complete iCloud backups, photographs, and other private information belonging to more than 200 victims, including both celebrities and non-celebrities. Brannan hacked email accounts by answering security questions that he could easily research by reviewing victims’ Facebook accounts.

Brannan also gained access to victims’ accounts by using phishing email accounts designed to look like legitimate security accounts from Apple. Because of the victims’ belief that the email had come from Apple, the victims would provide their usernames and passwords. Brannan would then access the victims’ email accounts, and search for personal information such as sensitive and private photographs and videos, including nude photographs. Authorities identified Brannan as a suspect during a California-based FBI investigation into hacked iCloud accounts commonly known as “Celebgate.”

As part of Brannan’s plea agreement, the United States made a non-binding recommendation to the Court that he be sentenced to 34 months in prison. At sentencing, Senior U.S. District Judge Henry E. Hudson accepted the government’s recommendation and imposed the agreed-upon sentence.

This matter stems from an investigation conducted by the FBI in Los Angeles into the leaks of photographs of numerous female celebrities in September 2014. The U.S. Attorney’s Office for the Central District of California, which is leading the prosecution, filed charges against Brannan in April, and the parties later agreed to transfer the case to the Eastern District of Virginia for further prosecution.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, and Thomas M. Chadwick, Acting Special Agent in Charge of the FBI’s Richmond Field Office, made the announcement after the sentencing hearing. Assistant U.S. Attorneys Brian R. Hood of the Eastern District of Virginia and Ryan White of the Central District of California prosecuted the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:18-cr-118.

NORFOLK, Va. – A Norfolk man pleaded guilty today to conspiring to distribute heroin.

According to court documents and information before the court, Barry Jamel Alexander, 32, sold heroin mixed with fentanyl to an undercover police officer at a Norfolk 7-Eleven. He used his cousin as a middle man in an attempt to protect himself from criminal exposure, but the store security cameras caught him handing the drugs to his cousin and, soon after, receiving the drug money.

Earlier that month, Alexander sold heroin mixed with fentanyl to a customer who overdosed on the substance and had to be revived with Narcan. At the time Alexander sold the heroin to the undercover officer, he knew that a customer had previously overdosed on his product. Agents later interviewed some of Alexander’s customers, who reported that over a five-year period they had purchased more than two kilograms of heroin from Alexander.

Alexander pleaded guilty to conspiracy, distribution, and possession with intent to distribute controlled substances, and faces a maximum penalty of 40 years in prison when sentenced on June 7. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, and Jesse R. Fong, Special Agent in Charge for the Drug Enforcement Administration’s (DEA) Washington Field Division, made the announcement after U.S. Magistrate Judge Lawrence R. Leonard accepted the plea. Assistant U.S. Attorneys William B. Jackson and John F. Butler are prosecuting the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:19-cr-5.

NORFOLK, Va. – Five Hampton Roads-area individuals pleaded guilty this week to their respective roles in a series of violent grocery store robberies in Chesapeake and Virginia Beach.

According to court documents, the individuals worked in at least six-member teams, and conducted armed robberies of a Food Lion in Chesapeake on September 25, a Food Lion in Virginia Beach on September 29, and a Harris Teeter in Virginia Beach on October 3. The teams included inside and outside look-outs, getaway drivers, and two gunmen. The teams used police scanners to monitor law enforcement activity, encrypted applications, and earpieces to communicate with one another. The inside look-out would find and identify the grocery store manager, initiate the robbery, and communicate the position of the manager to masked members of the conspiracy who entered the stores with firearms. At each robbery the gunmen demanded the managers open the grocery store safe. In the final robbery at a Harris Teeter in Virginia Beach, one of the gunmen shot the store manager.

Please see below for a list of defendants who have pleaded guilty in this case.

Name, Age

Hometown

Pleaded Guilty To

Maximum Sentence

Cato M. Battle, 18

Virginia Beach

1 Count of Conspiracy;

1 Count of Robbery; 1 Count of Using a Firearm During a Crime of Violence

Mandatory Minimum 7 years; Maximum Life

Willey E. Brooks, Jr., aka “Wally”, 26

 

Chesapeake

1 Count of Conspiracy;

2 Counts of Robbery; 2 Counts of Using a Firearm During a Crime of Violence

Mandatory Minimum 14 years; Maximum Life

Monica Perkins, 29

Norfolk

1 Count of Conspiracy;

1 Count of Robbery;

1 Count of Using a Firearm During a Crime of Violence

Mandatory Minimum 7 years; Maximum Life

Brandon C. Tisdale, aka “Dot, GM”, 20

Virginia Beach

1 Count of Conspiracy;

2 Counts of Robbery;

2 Counts of Using a Firearm During a Crime of Violence

Mandatory Minimum 17 years; Maximum Life

Trevor L. Tisdale, aka “T”, 24

 

Virginia Beach

1 Count of Conspiracy;

2 Counts of Robbery; 2 Counts of Using a Firearm During a Crime of Violence

Mandatory Minimum 14 years; Maximum Life

 

Keonte K. Yorkshire, aka Tae, 21 of Virginia Beach, pleaded guilty to his role in the offense on February 5 and faces a mandatory minimum of 17 years and a maximum sentence of life.

Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.

This case is part of Project Safe Neighborhoods (PSN), which is the centerpiece of the Department of Justice’s violent crime reduction efforts.  PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Martin Culbreth, Special Agent in Charge of the FBI’s Norfolk Division, James A. Cervera, Chief of Virginia Beach Police, and Kelvin L. Wright, Chief of Chesapeake Police, made the announcement after U.S. District Judge Raymond A. Jackson accepted the plea. Assistant U.S. Attorneys John F. Butler and Andrew C. Bosse are prosecuting the case.

This case was investigated by the FBI’s Tidewater Violent Crime Task Force, in partnership with the Virginia Beach and Chesapeake Police Departments.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:18-cr-177.

ALEXANDRIA, Va. – An international narcotics trafficker from the Dominican Republic pleaded guilty yesterday evening to leading and organizing a multi-million dollar conspiracy to purchase 100 kilograms of cocaine. 

According to court documents, Luis Rafael Tavarez, aka El Primo, 36, traveled from New York to Northern Virginia on October 23, 2018 with co-conspirators Manny Lizardo and Luis Liriano-Toribio to obtain 100 kilograms of cocaine in exchange for $2.5 million in cash. Law enforcement seized over $1.15 million in cash at the time of the Tavarez’s arrest.

On several occasions in September and October 2018, Tavarez reaffirmed his desire to travel to Virginia to conduct a large drug transaction whereby he would pay $25,000 per kilogram of cocaine. In connection with this multi-million dollar deal, Tavarez sought an additional vehicle, known to narcotics traffickers as a “trap vehicle,” to split large amounts of cocaine into separate cars in order to minimize the risk of potentially losing the entire shipment or load of the drugs in the event that law enforcement stopped one of the vehicles. In furtherance of the conspiracy, Tavarez used multiple telephones, an alias, and encrypted communication platforms because he believed those measures would minimize the risk of law enforcement detection.

Tavarez admitted that Lizardo and Liriano-Toribio traveled to Northern Virginia to assist him in trafficking and/or transporting the large shipment of cocaine back to New York. Tavarez served as the leader and organizer of the operation, and was arrested at a hotel in Vienna in possession of over $1 million dollars in cash. Lizardo and Liriano-Toribio were arrested in a parking garage in Fairfax attempting to take possession of the cocaine.

Tavarez faces a mandatory minimum term of 10 years in prison and a maximum penalty of life in prison when sentenced on May 24. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Jesse R. Fong, Special Agent in Charge for the Drug Enforcement Administration’s (DEA) Washington Field Division, Colonel Gary T. Settle, Superintendent of Virginia State Police, Patrick J. Lechleitner, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Washington, D.C., and Colonel Edwin C. Roessler Jr., Fairfax County Chief of Police, made the announcement after the plea was accepted by U.S. District Judge Anthony J. Trenga. Assistant U.S. Attorney Raj Parekh is prosecuting the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:18-cr-426.

RICHMOND, Va. – A Mexican citizen pleaded guilty today to illegally reentering the United States after removal and committing further crimes that resulted in his arrest on drug, assault and firearm charges.

According to court documents, Mexican citizen Linaldo Martinez Hernandez, 30, first illegally entered the United States on the Texas border. In 2008, he was apprehended by immigration authorities in North Carolina and removed at taxpayer expense from the United States to Mexico. Thereafter, on an unknown date, Martinez Hernandez illegally reentered the United States a second time. On January 14, ICE learned Martinez Hernandez had been arrested in Richmond for drug, assault, and firearm charges.

Hernandez pleaded guilty to illegal reentry and faces a maximum penalty of two years in prison when sentenced on May 16. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, and Jeffrey M. Jacoff, Acting Field Office Director for U.S. Immigration and Customs Enforcement’s (ICE) Enforcement and Removal Operations (ERO) Washington, D.C., made the announcement after U.S. Magistrate Judge David J. Novak accepted the plea. Assistant U.S. Attorney S. David Schiller is prosecuting the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:19-cr-22.

ALEXANDRIA, Va. – An Alexandria pastor was sentenced today to 8 years in prison for a $2 million fraud scheme that victimized members of his congregation, clergymen, and prospective investors in a Nigerian oil scheme.

“Millender preyed upon the religious beliefs and charitable desires of more than two dozen victims and has demonstrated little to no remorse for his actions,” said G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia. “His rampant fraud scheme has exacted a heavy emotional, spiritual and financial toll on his victims, and today’s sentence reflects the seriousness of his crime. My thanks to the trial team and our investigative partners for their terrific work on this righteous case.”

According to court documents and trial testimony, Terry Wayne Millender, 54, the former senior pastor of Victorious Life Church in Alexandria, operated Micro-Enterprise Management Group (MEMG), a Virginia company that alleged to help poor people in developing countries by providing small, short-term loans to start or expand existing businesses by working with a network of established micro-finance institutions. Terry Millender served as chief executive officer of MEMG. Millender and his co-conspirators recruited investors, many of whom invested their retirement funds in a shell company called Equity Trust that investors were falsely led to believe was a third party entity. To recruit investors, Terry Millender emphasized MEMG’s Christian mission and use of the funds to help the poor, promising guaranteed rates of return, assuring investors that the loans’ principal was safe and backed by the assets of MEMG. Instead, the money Millender obtained from investors was used to conduct risky trading on the foreign exchange currency market and options trading, to make payments towards the purchase of a $1.75 million residence for Terry Millender and his wife, to purchase lavish furnishings for their home, and on other personal expenses. To conceal how they had actually used the money, Millender falsely assured investors that they would get their money back and blamed delays in repaying investors on the 2008 financial crisis, among other things. 

After MEMG failed, Terry Millender created another entity called Kingdom Commodities Unlimited (KCU), which purportedly specialized in the brokering of Nigerian oil deals. Multiple victims entered into loan agreements with Millender, totaling over $450,000. Like MEMG, the KCU agreements lured prospective investors into giving the Millenders money by promising high rates of return and short term loans. The Millenders used the KCU lenders’ money to pay for their rent and golf trips, as well as a birthday party and other personal expenses.

Millender also failed to disclose any of the income he received from the MEMG and KCU fraud schemes on his income taxes. He was ordered to pay more than $2 million in restitution. This investigation was initiated after a victim of the MEMG scheme contacted authorities, including the Virginia State Corporation Commission.

“The fraudulent solicitation of investments through the US Mail not only jeopardizes people’s trust in the U.S. postal system, it threatens the overall financial health of our communities,” said Postal Inspector in Charge Peter Rendina, U.S. Postal Inspection Service - Washington Division. “With our partner law enforcement agencies, Postal Inspectors will continue to aggressively investigate these crimes and continue to ensure our customers’ trust in the United States Postal Service.”

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Kelly R. Jackson, Special Agent in Charge, Washington, D.C. Field Office, IRS-Criminal Investigation (IRS-CI), and Peter R. Rendina, Inspector in Charge of the Washington Division of the U.S. Postal Inspection Service, made the announcement after sentencing by U.S. District Judge Anthony J. Trenga. Assistant U.S. Attorneys Jamar K. Walker, Kimberly R. Pedersen, and Katherine L. Wong prosecuted the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:16-cr-239.

NORFOLK, Va. – A Virginia Beach man was sentenced today to three years in prison for his involvement in a conspiracy to distribute 50 kilograms or more of marijuana from California to Virginia and his involvement in laundering the marijuana proceeds.

According to court documents, Jamel Stokes, 26, was involved with several co-conspirators in trafficking large quantities of marijuana from California to Virginia. Stokes would receive the shipments of marijuana from California at two Virginia Beach addresses, and then break down the shipments into smaller packages for further distribution in the Hampton Roads area. Stokes also participated in laundering the proceeds from the sale of the marijuana shipments by depositing proceeds into various bank accounts in Virginia, and on the same day someone in California would withdraw the money from those same accounts.

Stokes also participated in secreting money in boxes and shipping them to California. Stokes was apprehended when a large shipment of marijuana was interdicted at the post office. A delivery of the parcel was made to the address on the shipping label. When a co-conspirator picked the box up, he was arrested and told law enforcement that Stokes had been paying him to pick up boxes full of marijuana and to deliver them to various addresses.

Between the two Virginia Beach addresses Stokes used to take delivery of marijuana, a total of 47 parcels were delivered from Northern California with a total weight of 50 kilograms or more but less than 100 kilograms of marijuana.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Jesse R. Fong, Special Agent in Charge for the Drug Enforcement Administration’s (DEA) Washington Field Division, Kelly R. Jackson, Special Agent in Charge, Washington, D.C. Field Office, IRS-Criminal Investigation (IRS-CI), and Peter R. Rendina, Inspector in Charge of the Washington Division of the U.S. Postal Inspection Service, made the announcement after sentencing by Senior U.S. District Judge Henry Coke Morgan, Jr. Assistant U.S. Attorneys William D. Muhr and Kevin Hudson prosecuted the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:18-cr-146.

RICHMOND, Va. – A Honduran man was sentenced today to 20 years in prison for his leadership role in the Los Cachrios drug trafficking organization (DTO), a large-scale Honduran cocaine trafficking group.

According to court documents, Willian Medina-Escobar, 34, conspired to distribute over 1,000 kilograms of cocaine on United States registered aircraft from 2011 to 2014. Medina-Escobar, who was extradited to the United States in September 2017, served in a managerial role for the Los Cachiros DTO. In this role, Medina-Escobar inspected aircraft, organized the transport of cocaine, identified clandestine airstrips, negotiated the purchase of cocaine with sources of supply, and coordinated the landing of cocaine-laden aircraft.

In July 2013, the Los Cachiros DTO purchased a Beechcraft King Air C-90 (King Air C-90) aircraft with United States registered tail number N92XXXX to transport cocaine from Venezuela to Honduras. In the summer of 2013, Medina-Escobar negotiated the purchase of 1,025 kilograms of cocaine from a Colombia source of supply on behalf of the Los Cachiros DTO.  In October 2013, the King Air C-90 flew from Guatemala to Venezuela to load and transport the cocaine shipment.  On October 27, 2013, the King Air C-90 departed from Apure, Venezuela and transported 1,025 kilograms of cocaine to a clandestine airstrip near Limon, Honduras. As part of this operation, Medina-Escobar was present on the clandestine airstrip, communicated with the pilots via radio, and assisted in the safe landing of the aircraft. Upon the King Air C-90’s arrival in Honduras, the 1,025 kilograms of cocaine were off-loaded and placed into the custody of the Los Cachiros DTO for further redistribution and sale.

Operation Strong Moon was investigated as part of the Organized Crime and Drug Enforcement Task Force (OCDETF). The OCDETF program is a federal multi-agency, multi-jurisdictional task force that supplies supplemental federal funding to federal and state agencies involved in the identification, investigation, and prosecution of major drug trafficking organizations. The principal mission of the OCDETF program is to identify, disrupt, and dismantle the most serious drug trafficking, weapons trafficking, and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Jesse R. Fong, Special Agent in Charge for the Drug Enforcement Administration’s (DEA) Washington Field Division, and Kelly R. Jackson, Special Agent in Charge, Washington, D.C. Field Office, IRS-Criminal Investigation (IRS-CI), and Colonel David R. Hines, Hanover County Sheriff’s Office, made the announcement after sentencing by Senior U.S. District Judge Henry E. Hudson. Assistant U.S. Attorneys Erik S. Siebert and Peter S. Duffey prosecuted the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:16-cr-91.

ALEXANDRIA, Va. – A Salvadoran national was sentenced today to 18 months in prison for illegally reentering the United States.

“Guevara-Paz was twice convicted of felony offenses, and reentered within months after his deportation as an aggravated felon,” said G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia. “This is a serious issue of public safety and national security, and we remain committed to prioritizing criminal immigration enforcement.”

According to court documents, Jaime Amilcar Guevara-Paz, 42, illegally entered the United States and was deported in April 2008 as an aggravated felon after being convicted for kidnapping in the third degree in Texas, as well as another felony charge in California. Guevara-Paz was removed from the United States twice before his reentry spurring the instant prosecution.

Following his second removal in 2009, Guevara-Paz returned yet again under a fictitious name and was found to be in the country illegally in August 2018 following his arrest in Fairfax County on unrelated state charges.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, and Jeffrey M. Jacoff, Acting Field Office Director for U.S. Immigration and Customs Enforcement’s (ICE) Enforcement and Removal Operations (ERO) Washington, D.C., made the announcement after sentencing by U.S. District Judge Anthony J. Trenga. The case was prosecuted by Special Assistant U.S. Attorneys Heather Call and Evan Clark, as well as Assistant U.S. Attorney Kimberly R. Pedersen.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:18-cr-356.

ALEXANDRIA, Va. – A Canadian man living in Leesburg was sentenced today to 21 years in prison for conspiring to distribute heroin and fentanyl that caused two deaths and one non-fatal overdose in 2016.

“Curry’s distribution of heroin and fentanyl in Leesburg carried grave consequences, causing at least three overdoses, including two overdose deaths,” said G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia. “The investigation and prosecution of opioid-related crimes continues to be a top priority for the Eastern District, and we remain steadfast in our pursuit of those who spread this poison in our communities.”

According to court documents, Joseph Riley Curry, 29, obtained heroin and fentanyl from sources of supply that he distributed to customers in Loudoun County. Drugs that Curry distributed killed two people in March 2016, and caused a third individual to experience an overdose that required medical intervention. In August 2017, Curry was arrested on a state felony distribution charge. While in custody, Curry ordered another individual to destroy evidence he thought might be used against him in a possible federal prosecution.

This matter was investigated by the Leesburg Police Department and the Washington Field Office’s Safe Streets/HIDTA Task Force – Northern Virginia which is composed of FBI Agents, and Task Force Officers from the Fairfax County, Loudoun County, Leesburg, Prince William County Police Departments, HSI, ATF, with assistance from the DEA Mid-Atlantic Regional Laboratory. This matter was brought to the attention of the task force by the Leesburg Police Department.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Matthew J. DeSarno, Special Agent in Charge, Criminal Division, FBI Washington Field Office, Michael L. Chapman, Loudoun County Sheriff, and Gregory C. Brown, Leesburg Chief of Police, made the announcement after sentencing by U.S. District Judge Anthony J. Trenga. Assistant U.S. Attorney David A. Peters prosecuted the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:18-cr-396.

ALEXANDRIA, Va. – A former probation officer was sentenced today to nearly four years in prison for obstructing a federal grand jury investigation into armed drug traffickers and gang members.

According to court documents, Abass Conteh, 28, of Dumfries, served as a Virginia Department of Corrections Probation and Parole Officer working in Prince William County in 2017. As part of his duties, Conteh met with law enforcement officers and discussed ongoing criminal investigations, including with a Prince William County Police Department (PWCPD) gang detective. During the course of 2017, Conteh used his cell phone and social media accounts to convey confidential law enforcement information about ongoing federal investigations into drug traffickers and gang members. Conteh learned this information from the PWCPD detective and other sources. During these communications, Conteh provided advice to individuals under investigation on how to avoid being prosecuted.

For example, Conteh informed his cousin Nasiru Carew, a multi-time convicted felon who was sentenced to 16 years in federal prison in August 2018, that federal law enforcement were investigating the individuals who supplied local rappers with guns, money, and drugs. Conteh revealed further information to Carew which he learned from the PWCPD detective, including revealing the identities of several individuals who the "FEDS" were investigating, as well as the strategy of the investigation.

In March 2017, Conteh informed Carew that federal law enforcement were investigating Tarvell Vandiver, who was the leader of the Imperial Gangsta Blood gang. Carew later passed this information to Vandiver, who he had conspired with to distribute controlled substances. Vandiver was later sentenced to 20 years in federal prison.

In December 2017, the PWCPD Detective informed Conteh that federal law enforcement were investigating Alpha Kamara, who was later sentenced to five years in federal prison, and his sources of supply for narcotics. Shortly thereafter, Conteh revealed the information to Carew and later another individual. Conteh wrote, “[The PWCPD detective] brought All their names up. He never brought their names up until Alpha got womped. The feds goal is to find the supplier for the guns and drugs… They can’t do [expletive] to nobody if alpha [Kamara] don’t snitch”.

Conteh, Carew, Vandiver, and Kamara were prosecuted as part of Operation Tin Panda, which has resulted in 48 federal convictions and was investigated as part of the Organized Crime and Drug Enforcement Task Force (OCDETF). The OCDETF program is a federal multi-agency, multi-jurisdictional task force that supplies supplemental federal funding to federal and state agencies involved in the identification, investigation, and prosecution of major drug trafficking organizations. The principal mission of the OCDETF program is to identify, disrupt, and dismantle the most serious drug trafficking, weapons trafficking, and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Ashan M. Benedict, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATF) Washington Field Division, Matthew J. DeSarno, Special Agent in Charge, Criminal Division, FBI Washington Field Office, and Barry M. Barnard, Chief of Prince William County Police, made the announcement after sentencing by U.S. District Judge Liam O’Grady. Assistant U.S. Attorneys Uzo Asonye and Carina A. Cuellar prosecuted the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:18-cr-367.

RICHMOND, Va. – A Chester man was sentenced today to 27 years for robbing four convenience stores and the attempted robbery of another convenience store.

According to court documents, Anthony Wilson Jr., and his co-defendants were involved in a string of armed robberies and an attempted robbery at various gas stations and convenience stores located in the areas of Chesterfield County and Richmond during March 2018. In each of the robberies and attempted robbery, Wilson entered the stores with a firearm, brandished the gun, and placed all of the store clerks in fear for their lives. In each of the robberies, Wilson made off with cash and other store items.

This case is part of Project Safe Neighborhoods (PSN), which is the centerpiece of the Department of Justice’s violent crime reduction efforts.  PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, and MaryJo Thomas, Acting Special Agent in Charge of the FBI’s Richmond Field Office, made the announcement after sentencing by United States District Judge John A. Gibney, Jr. Assistant U.S. Attorney Peter S. Duffey prosecuted the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:18-cr-88.

ALEXANDRIA, Va. – A federal grand jury returned an indictment today charging death-eligible offenses against 11 members of MS-13 for their role in the kidnapping and murder of two juveniles in 2016.

According to allegations in the indictment, in August and September 2016, Edenilson Misael Alfaro, aka “Lil Sicario,” originally from El Salvador and holding a high-ranking position in MS-13, authorized numerous lower-ranking members of MS-13’s Park View Locos Salvatrucha (PVLS) clique in Virginia to lure, kidnap, and murder two juveniles, E.E.E.M. and S.A.A.T.

According to the indictment, Alfaro was notified in August 2016 that E.E.E.M. posted a photograph of a masked man to his Facebook account with the number 666 superimposed above his head.  Perceiving the Facebook post as evidence that E.E.E.M. was a member of the rival 18th Street gang, Alfaro authorized and directed members of the PVLS clique to kill E.E.E.M. Today’s indictment charges Alfaro and six other members and associates of the PVLS clique for their role in luring E.E.E.M. to Holmes Run Stream Valley Park in Fairfax County where E.E.E.M. was attacked and murdered. The indictment further alleges that the defendants videotaped E.E.E.M.’s murder to prove to gang leadership that the murder had been completed and that they were worthy of promotion within the gang.

According to the indictment, in September 2016, Elmer Zelaya Martinez, aka “Killer,” originally from El Salvador and holding a high-ranking position in the PVLS clique, reported to Alfaro his belief that S.A.A.T. was cooperating with law enforcement.  Alfaro authorized and directed members of the PVLS clique to kill S.A.A.T. Today’s indictment charges all 11 defendants for their role in luring S.A.A.T. to Holmes Run Stream Valley Park, where S.A.A.T. was attacked and murdered.  The indictment further alleges that the defendants videotaped S.A.A.T.’s murder as well to prove to gang leadership that the murder had been completed and that they were worthy of promotion in the gang.

The defendants are charged with conspiracy to commit kidnapping and murder in aid of racketeering activity, conspiracy to kidnap, murder in aid of racketeering activity, and kidnapping resulting in death. If convicted of the substantive counts, the defendants may face the death penalty. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.

The case was also investigated as part of the Organized Crime Drug Enforcement Task Force’s (OCDETF) Operation Devil’s Playground. The OCDETF program is a federal multi-agency, multi-jurisdictional task force that supplies supplemental federal funding to federal and state agencies involved in the identification, investigation, and prosecution of major drug trafficking organizations. The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking, and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Matthew J. DeSarno, Special Agent in Charge, Criminal Division, FBI Washington Field Office, and Colonel Edwin C. Roessler Jr., Fairfax County Chief of Police, made the announcement after the indictment was returned. Assistant U.S. Attorneys Rebeca H. Bellows and Alexander E. Blanchard are prosecuting the case.

The U.S. Immigration and Customs Office’s Enforcement and Removal Operations, the Northern Virginia Gang Task Force, the United States Marshal's Service, Prince William County Police Department, Montgomery County Police Department, Prince George's County Police Department, Loudoun County Sheriff's Office, Alexandria Police Department, Leesburg Police Department, and Homeland Security Investigations provided significant assistance during this investigation.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:18-cr-123.

An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until and unless proven guilty in court.

RICHMOND, Va. – A Honduran citizen pleaded guilty today to illegally reentering the United States after being removed by immigration authorities.

“Rios-Garcia illegally entered the United States, was deported at taxpayer expense, returned illegally a second time and then endangered the safety of this community by driving under the influence,” said G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia. “We continue to make these cases a priority and will work closely with our local and state partners to ensure we are doing everything we can to ensure the safety of the communities we serve.”

According to court documents, Carlos Alexander Rios-Garcia, 22, illegally entered the United States and was deported in July 2017 after he was arrested in Baltimore on local criminal charges. Rios-Garcia illegally reentered the United States a second time and came into contact with law enforcement after he was arrested for DUI by Chesterfield County Police in November 2018.

“Plain and simple, ICE will continue to prioritize public safety threats for immigration enforcement,” said Jeffrey M. Jacoff, Acting Field Office Director for U.S. Immigration and Customs Enforcement’s (ICE) Enforcement and Removal Operations (ERO) Washington, D.C. “Individuals previously removed by ICE will face criminal re-entry charges if encountered again in the U.S.”

Rios-Garcia pleaded guilty to illegal reentry and faces a maximum penalty of two years in prison when sentenced on May 21. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, and Jeffrey M. Jacoff, Acting Field Office Director for U.S. Immigration and Customs Enforcement’s (ICE) Enforcement and Removal Operations (ERO) Washington, D.C., made the announcement after U.S. District Judge John A. Gibney Jr. accepted the plea. Assistant U.S. Attorney S. David Schiller is prosecuting the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:19-cr-25.

NORFOLK, Va. – A federal grand jury returned an indictment today charging a Hampton man and woman with conspiracy, health care fraud, false statements, and aggravated identity theft.

According to allegations in the indictment, Maurice Moody, 40, and Dena Major, 48, conspired to defraud the Virginia Medicaid program out of approximately $109,000 by submitting fraudulent claims to Medicaid for their severely disabled son’s care, which he was eligible. Major was the child’s primary care giver and under Medicaid rules, she was also in charge of hiring a personal care aide to help in his care. Despite knowing that Medicaid does not permit the hiring of a parent to be a personal care aide, Major hired Moody to be their child’s personal care aide and falsely stated that Moody was the child’s uncle.

The indictment alleges that Moody also submitted claims for personal care hours provided to his son when Moody was incarcerated, and when he was out of the area travelling. In September 2015, the child was removed from Major’s custody on allegations of abuse and neglect. Nonetheless, Moody and Major continued to bill Medicaid for his care from September 2015 to April 2016. When challenged, the pair attempted to use another minor and pass him off as their child with the Medicaid service facilitator.

Moody and Major are each charged with conspiracy, health care fraud, false statements in a health care matter, and aggravated identity theft. If convicted, they each face a minimum of 2 years and a maximum of 44 years in prison. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, and Martin Culbreth, Special Agent in Charge of the FBI’s Norfolk Field Office, made the announcement. Assistant U.S. Attorney Joseph L. Kosky is prosecuting the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER.

An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until and unless proven guilty in court.

NORFOLK, Va. – A federal jury convicted a Norfolk man today on charges of robbery and brandishing a firearm during a robbery.

According to court records and evidence presented at trial, Desmond Littlejohn, 33, and his co-conspirator robbed a firearm and ammunition dealer in Virginia Beach. On Oct. 9, 2017, the owner and an employee had returned around 3:30 a.m. from a gun show in Philadelphia. As they were unloading a truck, Littlejohn and his co-conspirator, wearing ski masks, ran up to the owner and employee brandishing firearms. The robbers took a black duffle bag which contained approximately $10,000 in proceeds from the gun show. As the robbers were fleeing in a car, they tossed items out of the black duffle bag and onto the street in an effort to get at the cash. The Virginia Beach Police discovered the discarded items which also included a cash bag next to a ski mask. Through analysis of the ski mask law enforcement was able to trace the mask back to Littlejohn.

Littlejohn faces a mandatory minimum sentence of 7 years and a maximum sentence of life in prison when sentenced on May 14. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.

This case is part of Project Safe Neighborhoods (PSN), which is the centerpiece of the Department of Justice’s violent crime reduction efforts.  PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, and Ashan M. Benedict, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATF) Washington Field Division, made the announcement after U.S. District Judge Rebecca Beach Smith accepted the verdict. Assistant U.S. Attorneys William D. Muhr and William B. Jackson are prosecuting the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:18-cr-119.

NORFOLK, Va. – A Franklin man was sentenced today to over eight years in prison for being a felon in possession of firearms and possessing firearms in furtherance of drug-trafficking crimes.

According to court documents, Loron Barnes, 25, was pulled over for driving 67 miles an hour in a 35-mile-an-hour zone roughly a block from the local police station. After officers smelled marijuana coming from the vehicle, they conducted a search and found contraband in every part of the car, including an AK-type rifle loaded with 57 rounds of ammunition in two extended magazines taped together sitting on the back seat next to a black ski mask and suspected marijuana; a loaded, stolen handgun underneath the driver seat; heroin, cocaine, amphetamine, and a digital scale in the driver’s-side-door pocket; more heroin in the center console; more cocaine in the front passenger-side door pocket; two boxes of .45 caliber ammo on the front-passenger-seat floor; and an empty handgun magazine in the driver’s-side-door armrest. Police discovered more than 26 grams of heroin and more than 20 grams of cocaine.

This case is part of Project Safe Neighborhoods (PSN), which is the centerpiece of the Department of Justice’s violent crime reduction efforts.  PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia; Ashan M. Benedict, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATF) Washington Field Division; Michael K. Lamonea, Assistant Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Norfolk; and Robert Porti, Deputy Chief of the City of Franklin Police Department, made the announcement after sentencing by Senior U.S. District Judge Robert G. Doumar. Assistant U.S. Attorney William B. Jackson prosecuted the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:18-cr-118.

NORFOLK, Va. – A Virginia Beach man was sentenced today to more than 15 years in prison for conspiring to distribute and possess heroin and for possessing a firearm as a convicted felon.

“Drug traffickers in possession of firearms pose a significant threat to our communities,” said G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia. “Investigating and prosecuting these cases remains a top priority in the Eastern District. We would not have been able to achieve this result without the cooperation of our local and federal law enforcement partners. My thanks to Homeland Security Investigations Norfolk and the Virginia Beach Police Department for their outstanding work on this case.”

According to court documents, in June 2016, law enforcement learned that a person identified in court filings as S.D., was supplying heroin to an unidentified suspect with a (757) area code telephone number. Homeland Security Investigations Norfolk and the Virginia Beach Police (VBPD) identified the local suspect as Antonio Jerome Johnson, 37, of Virginia Beach. On October 20, 2016, HSI-Norfolk and VBPD observed S.D. enter Johnson’s residence in Virginia Beach. The next day, HSI-Norfolk and VBPD executed a search warrant at Johnson’s residence and seized nearly 800 grams of heroin, approximately $240,000 in cash, a loaded handgun, a bill money counter, digital scales, and a kilogram press. Johnson was a convicted felon at the time of this incident and was prohibited from possessing any firearm.

This case is part of Project Safe Neighborhoods (PSN), which is the centerpiece of the Department of Justice’s violent crime reduction efforts.  PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Michael K. Lamonea, Assistant Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Norfolk, and James A. Cervera, Chief of Virginia Beach Police, made the announcement after sentencing by U.S. District Judge Rebecca Beach Smith. Assistant U.S. Attorney Darryl J. Mitchell prosecuted the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:17-cr-17.

ALEXANDRIA, Va. – A Woodbridge man was sentenced today to 15 years in prison for sex trafficking young women and being a felon in possession of a firearm.

According to court documents and evidence presented at trial, Cornell Devore Rhymes, 32, conspired with others, including Justin Robinson and Markus Plummer, who were previously convicted, to force and coerce young women into commercial sex work during the summer of 2017. Over a period of approximately three months, Rhymes and the others recruited young women, including a minor, into commercial sex work. The men advertised the women for sex acts, set their “dates,” and collected and retained the profits. Prior to trial, Rhymes had pleaded guilty to being a felon in possession of a firearm, after law enforcement discovered a gun in his home during the execution of a search warrant.

This matter was investigated by the FBI Washington Field Office’s Child Exploitation and Human Trafficking Task Force, which is composed of FBI agents, along with detectives from the Fairfax County Police, Arlington County Police, Prince William County Police, Loudoun County Sheriff’s Office, Leesburg Police, Alexandria City Police, Washington Metropolitan Police, Fauquier County Sheriff’s Office, George Mason University Police, United States Marshal’s Service, and agents of various Office of Inspector Generals. This matter was brought to the task force by the Prince William County Police Department.

This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.

This case is part of Project Safe Neighborhoods (PSN), which is the centerpiece of the Department of Justice’s violent crime reduction efforts.  PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Matthew J. DeSarno, Special Agent in Charge, Criminal Division, FBI Washington Field Office, Colonel Edwin C. Roessler Jr., Fairfax County Chief of Police, and Barry M. Barnard, Chief of Prince William County Police, made the announcement after sentencing by Senior U.S. District Judge Claude M. Hilton. Assistant U.S. Attorneys Whitney Dougherty Russell and Raizza Ty prosecuted the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:18-cr-22. Information about Justin Robinson and Markus Plummer’s cases can be found by searching for Case No. 1:17-cr-310.

RICHMOND, Va. – A previously convicted felon was sentenced today to nearly six years in prison for attempted robbery and being a felon in possession of a firearm.

According to court documents, Revardo Darnell White, 59, of Richmond, walked into the back office at Nations Motors Auto Lot in Richmond while wearing a mask and brandishing a loaded firearm and demanded money from his victims. When White pointed the firearm directly at one of the victims, the victim offered cash from his own wallet. White tried to charge the weapon and a bullet fell or was ejected from the weapon onto the floor. White left without taking any cash from the victim or the business.

This case is part of Project Safe Neighborhoods (PSN), which is the centerpiece of the Department of Justice’s violent crime reduction efforts.  PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Ashan M. Benedict, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATF) Washington Field Division, made the announcement after sentencing by Senior U.S. District Judge Henry E. Hudson, Jr. Assistant U.S. Attorney Janet Jin Ah Lee prosecuted the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:18-cr-61.

NEWPORT NEWS, Va. – A previously convicted felon was sentenced today to over three years in prison for possessing a firearm.

“Convicted felons who possess a firearm will be held accountable and prosecuted,” said G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia. “We remain steadfast in our commitment to removing guns from the hands of criminals as they present a real danger to the safety of our law enforcement partners and members of the communities they serve.”

According to court documents, in May 2018, Newport News Police officers attempted a traffic stop on a vehicle that did not use a turn signal. The vehicle later pulled over and officers observed Kenneth S. Pressley, 43, exit the passenger side of the vehicle, clutching both of his hands at the center of his waistband and flee on foot. An officer followed Pressley to the backyard of the residence, and observed him bent over at the waist and heard a firearm discharge. The officer gave Pressley verbal commands, but Pressley continued to flee from the officer for a short distance. Pressley ultimately complied and was taken into custody, and officers later recovered a Glock 23 .40 caliber handgun containing 12 rounds of ammunition, as well as the bullet Pressley discharged on scene.

“The men and women of ATF work tirelessly day in and day out, along with our law enforcement partners, to rid our streets of illegal guns and violent crime and those who jeopardize the safety of our citizens and communities,” said Ashan M. Benedict, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATF) Washington Field Division. “Be assured, if you use guns to commit violence, we are coming for you.”

This case is part of Project Safe Neighborhoods (PSN), which is the centerpiece of the Department of Justice’s violent crime reduction efforts.  PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Ashan M. Benedict, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATF) Washington Field Division, Steve R. Drew, Chief of Newport News Police, made the announcement after sentencing by Chief U.S. District Judge Mark S. Davis. Assistant U.S. Attorney Megan M. Cowles prosecuted the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 4:18-cr-71.

A Fresno, California man pleaded guilty today to using the internet to coerce and entice a minor into producing child pornography. 

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney G. Zachary Terwilliger of the Eastern District of Virginia, Assistant Director in Charge Nancy McNamara of the FBI Washington Field Office and Chief of Police Barry M. Barnard of the Prince William County Police Department made the announcement. 

Emilio Morales, 29, pleaded guilty to one count of coercion and enticement of a minor into illegal sexual activity before U.S. District Judge Liam O’Grady of the Eastern District of Virginia.  Sentencing is scheduled for May 31.

According to admissions made in connection with his guilty plea, Morales met the 11-year-old victim while playing the online game “Clash of Clans.”  In 2017, Morales began grooming the victim over Clash of Clans before proposing that he and the victim communicate privately over the online chatting application Kik Messenger.  While communicating over Kik Messenger, Morales coerced and persuaded the victim to produce and send him sexually explicit images and videos.  The conduct ceased when, despite Morales’s attempts at manipulation, the minor victim refused to participate in any further sexual activity.

The case was investigated by the FBI Washington Field Office’s Child Exploitation and Human Trafficking Task Force and the Prince William County Police Department, with substantial assistance from the FBI’s Fresno Resident Agency.  It is being prosecuted by Trial Attorney Kyle P. Reynolds of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Whitney D. Russell of the Eastern District of Virginia.

This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorneys’ Offices and CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.

ALEXANDRIA, Va. – An Arlington man pleaded guilty today to orchestrating eight fraud schemes that resulted in total losses of approximately $20 million.

According to court documents, Todd Elliott Hitt, 54, solicited approximately $30 million from investors for a variety of real estate and venture capital investments in the Washington, D.C. area from 2014 through August 2018. The investments included Hitt’s solicitation of approximately $17 million from investors in order to purchase a five-story office building adjacent to a planned future stop on the Silver Line in Herndon. Hitt made false statements and material omissions to investors by failing to disclose that a significant portion of the monies raised were commingled with other unrelated investment projects, used for personal spending to support an extravagant lifestyle and new investor’s funds used to pay off old investors in a Ponzi-like scheme. Hitt’s fraudulent conduct resulted in investor losses of approximately $20 million.

Hitt pleaded guilty to a charge of securities fraud in and faces a maximum penalty of 20 years in prison and a fine of $5 million or twice the gross gain or loss, whichever is greater. He is scheduled to be sentenced on June 21. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, and Matthew J. DeSarno, Special Agent in Charge, Criminal Division, FBI Washington Field Office, made the announcement after U.S. District Judge Leonie M. Brinkema accepted the plea. Assistant U.S. Attorney Mark D. Lytle is prosecuting the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:19-cr-43.

NEWPORT NEWS, Va. – A former bookkeeper was sentenced today to over five years in prison for embezzling funds from a Newport News medical practice and then obtaining a fraudulent SBA-guaranteed loan using the identification information of her father.

According to court documents, Amanda Viglietta, 32, of Newport News, was employed as the bookkeeper for Advanced ENT & Allergy from April through December 2016. In the course of her employment, Viglietta forged her employer’s signature on checks from Advanced ENT’s TowneBank account and caused such checks to be issued to herself, her boyfriend and to other persons and businesses to whom and which she owed money. In an effort to conceal the fraud, Viglietta made fraudulent entries in the QuickBooks records of Advanced ENT and created fake invoices. Vigilietta also made unauthorized and fraudulent use of the credit/debit cards associated with Advanced ENT.  Altogether, she fraudulently misappropriated funds in the approximate amount of $180,000 from Advanced ENT.

After the misappropriation from Advanced ENT came to light and Viglietta was terminated in December 2016, she established a limited liability company called Mumbling Mikes, LLC. In February 2017, using this entity, she made application and obtained a United States Small Business Administration (SBA) guaranteed loan from Celtic Bank, using identifying information of her father, without his knowledge or authorization. Viglietta obtained approximately $148,400 in loan funds and used large portions of this approved business loan on personal expenditures and obtaining cashier’s checks.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Peter R. Rendina, Inspector in Charge of the Washington Division of the U.S. Postal Inspection Service, Hannibal “Mike” Ware, Inspector General of the Small Business Administration (SBA), and Steve R. Drew, Chief of Newport News Police made the announcement after sentencing by Chief U.S. District Judge Mark S. Davis. Assistant U.S. Attorney Brian J. Samuels prosecuted the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 4:18-cr-36.

ALEXANDRIA, Va. – A Florida man was sentenced today to five years in prison for conspiracy to commit wire fraud for orchestrating a scheme that caused over $1.7 million in losses to multiple victims.

According to court documents, Armando Almirall, 37, of Oviedo, was one of the managing principals of a company called Aura Exchange LLC (AURA). Almirall and his co-conspirators, through AURA, promised their clients that they could help obtain funding for a host of business purposes, such as real estate transactions and television projects. Instead, Almirall and his co-conspirators spent large portions of their clients’ funds on personal expenses, cash withdrawals and wire transfers without the clients’ knowledge or consent.

In order to induce the victims to provide AURA with money, Almirall and his co-conspirators made a host of fraudulent misrepresentations, including representing to clients that AURA had an established business portfolio when no such portfolio existed. AURA also guaranteed victims that they would receive their initial equity deposits back when, in fact, none of the victims ever received any of their original investment nor any additional funding from AURA. Almirall further claimed that AURA had offices in Zurich, London, and New York when no such offices existed. Almirall also provided clients with fraudulent bank documents showing that AURA could obtain millions (and in one instance, billions) in funds for their clients.

In addition to the prison sentence, Almirall was ordered to pay over $1.77 million in restitution to the victims of the fraud scheme.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, and Matthew J. DeSarno, Special Agent in Charge, Criminal Division, FBI Washington Field Office, made the announcement after sentencing by U.S. District Judge Anthony J. Trenga. Assistant U.S. Attorney Jamar K. Walker prosecuted the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:18-cr-392.

ALEXANDRIA, Va. – A federal jury convicted two Florida men yesterday on charges of conspiracy, making false claims on the United States government, and wire fraud.

According to court records and evidence presented at trial, Dan Thomas Lounsbury, Jr., 50, of South Palm Beach, and Andres Lopez-Munoz, 35, are both executives of Tactical Products Group, LLC (TPG), a Florida-based manufacturer and re-seller of various products to military, law enforcement, and private security clients. Lounsbury, Jr., is the founder, owner, and CEO of TPG, while Lopez-Munoz is TPG’s Vice President for Sales and Federal Contracting. In 2012, TPG was selected as a sub-contractor on a contract to provide certain goods, including 10 sets of hard body armor plates, to the United States government.

The Government had requested a specific type of plate, and Lounsbury and Lopez-Munoz both knew that no substitutions were allowed. Furthermore, Lounsbury and Lopez-Munoz both knew that these plates were intended to protect government personnel in the field. Nevertheless, Lounsbury and Lopez-Munoz worked together to procure cheaper substitute plates, none of which were military-tested, and some of which were far outside of their warranty period. To get the United States government to accept and pay for these plates, Lounsbury and Lopez-Munoz had fake labels created and placed on the armor, falsely representing the plates to be the specific type that the government had ordered.

Lounsbury and Lopez-Munoz face a maximum penalty of 20 years in prison when sentenced on May 10. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.

G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, and Matthew J. DeSarno, Special Agent in Charge, Criminal Division, FBI Washington Field Office, made the announcement after U.S. District Judge Anthony J. Trenga accepted the verdict. Assistant U.S. Attorneys Grace L. Hill and Raj Parekh are prosecuting the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:18-cr-301.