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26 June 2023
Fourth Circuit Upholds Former Tabor City Doctor's Conviction for Operating a Pill MillRead the Press Release
NEW BERN, N.C. – A three-judge panel from the Fourth Circuit Court of Appeals issued a unanimous, published opinion affirming former physician Jong Whan Kim’s conviction and sentence for operating a pill mill in Tabor City. The Fourth Circuit’s decision was the first published opinion by the Court upholding a physician’s conviction for unlawful prescribing of opioids and other controlled substances since the Supreme Court decided Ruan v. United States, 142 S. Ct. 2370 (2022), which made it more difficult for the government to convict physicians for unlawful prescribing.
“Kim abused his trust and authority as a physician by writing illegitimate prescriptions for opioids and other controlled substances, and in doing so, placed his patients and children at a local elementary school at risk,” said U.S. Attorney Michael Easley. “The Fourth Circuit’s ruling reaffirms that doctors may not abuse their authority to write prescriptions for controlled substances by knowingly issuing prescriptions outside the scope of legitimate medical practice. Our commitment to prosecuting physicians and other prescribers who operate pill mills in Eastern North Carolina remains steadfast.”
On December 8, 2021, Kim, 76, pled guilty to conspiring with his office assistant, Tammy Thompson, to unlawfully dispense and distribute oxycodone, hydrocodone, methadone, and marijuana, in violation of 21 U.S.C. § 846; to multiple counts of unlawful dispensing and distribution of oxycodone, in violation of 21 U.S.C. § 841; and to distribution of marijuana and aiding and abetting, in violation of 21 U.S.C. § 841(a)(1) & 18 U.S.C. § 2. The district court sentenced Kim to 78 months in prison.
Kim’s misconduct dates to March 2017, when he was forced to resign from his medical practice due to concerns over his opioid prescribing practices. Soon thereafter, Kim opened a clinic in Tabor City. Over the next year, Kim unlawfully prescribed opioids and other controlled substances to “patients” who paid $200 in cash at each appointment. The investigation revealed that Kim often failed to comply with basic standards of legitimate medical practice. He wrote controlled substance prescriptions to virtually every patient he saw, often in the face of evidence of patient misuse and diversion. A confidential informant (“CI”) obtained opioid prescriptions from Kim on twelve occasions. On one occasion, he obtained marijuana from Kim’s office manager at the same time he obtained a prescription from Kim, and paid Kim for the marijuana. On another occasion, Kim wrote the CI a prescription after the CI asked for a higher dosage so he could sell more pills on the street. On a third occasion, the office manager told the CI, in Kim’s presence, that Kim was willing to trade work for prescriptions. In total, Kim dispensed more than two million doses of addictive prescription medications.
Kim’s clinic was located just steps from Tabor City Elementary School. Patients seeking controlled substances often loitered near the school, which created safety concerns. As the Fourth Circuit noted, the school was forced to cancel recess due to activity at Kim’s clinic, and the school was locked down more than once.
In affirming Kim’s conviction and sentence, the Fourth Circuit wrote that a “mountain of circumstantial evidence le[ft] little doubt” that Kim subjectively intended to prescribe opioids and other controlled substances outside the bounds of legitimate medical practice.
Michael Easley, U.S. Attorney for the Eastern District of North Carolina announced the Fourth Circuit’s decision. The Drug Enforcement Administration’s Charlotte Tactical Diversion Squad, Columbus County Sheriff’s Office, and the North Carolina State Bureau of Investigation, DECU investigated the case. Assistant U.S. Attorneys Nick Miller, Bryan Stephany and Tim Severo prosecuted the case. Assistant U.S. Attorneys David Bragdon and Andrew Kasper represented the United States before the Fourth Circuit.
The Fourth Circuit’s complete opinion in United States v. Kim can be found here.
A copy of this press release may be found on our website.
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Former Massachusetts Town Official Pleads Guilty to Wire Fraud in Rhode IslandRead the Press Release
PROVIDENCE – A former chairperson of the Board of Tax Assessors for the Town of Dedham, MA, pleaded guilty in federal court in Rhode Island today to a charge of wire fraud, admitting that, while serving as a Dedham town official, real estate broker, tax preparer, and property manager for the River Island Condominium Association in Woonsocket, RI, she devised a scheme to access nearly $50,000 in Association funds for her own personal use, announced United States Attorney Zachary A. Cunha.
Cheryl S. Sullivan, 68, of Dedham, MA, admitted that she used an Association debit card fifty-eight times to withdraw cash between January and November 2019, when she visited the Plainfield Park Casino in Plainfield, MA.
Casino records reflect that from January 4, 2019, to November 19, 2019, Sullivan gambled at the casino 176 times, almost every day. Bank records associated with the Condominium Association’s account reflect that there were sixty ATM withdrawals made from the account during the relevant time frame, of which fifty-eight of those occurred at the casino. The withdrawals occurred on multiple dates that Sullivan’s personal debit card had been used at the casino to attempt to withdraw cash from her own account but was declined. The condo association debit card was then immediately used to withdraw cash.
An investigation by the FBI, and the Plainville, MA, and Woonsocket, RI, Police Departments determined that Sullivan defrauded the Condo Association of a total of $49,156, of which, to date, nearly half has been paid back to the Association by the defendant.
Sullivan is scheduled to be sentenced on September 26, 2023. The defendant’s sentence will be determined by a federal judge after consideration of the U.S. Sentencing Guidelines and other statutory factors.
The case is being prosecuted by Assistant U.S. Attorney John P. McAdams.
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Former Department of Energy Employee Pleads Guilty to Accepting Bribes from Long Island Businessman in Exchange for Nearly $1 Million in Federal ContractsRead the Press Release
Earlier today, in federal court in Central Islip, Jami Anthony, the former Small Business Program Liaison and Procurement Officer for a Department of Energy (DOE) laboratory based in Virginia, pleaded guilty to a criminal information charging her with receiving bribes as a federal official in connection with a scheme to pay her more than $18,000 in exchange for more than $900,000 in DOE contracts. The proceeding was held before United States Magistrate Judge Anne Y. Shields. When sentenced, Anthony faces up to 15 years in prison. As part of her guilty plea, Anthony agreed to forfeit approximately $18,800.
Breon Peace, United States Attorney for the Eastern District of New York, and Teri L. Donaldson, Inspector General, DOE, announced the guilty plea.
“Motivated by greed, Anthony’s actions betrayed the Department of Energy and resulted in the purchase of electronic components that caused major fire damage to a government laboratory,” stated United States Attorney Peace. “Corruption undermines the integrity of competitive bidding in the procurement process and will be aggressively prosecuted.”
Mr. Peace thanked the U.S. Department of Defense, Defense Criminal Investigative Service, for its work on the case.
Teri L. Donaldson, the Department of Energy Inspector General said, “Bribing public officials is terrible behavior. Taking bribes when working as a public official representing the U.S government is even worse. We simply will not tolerate these betrayals of the public’s trust. We will continue to work with our partners at the Justice Department and the U.S. Attorney’s Offices to detect such behaviors and bring those involved to justice.”
Between approximately December 2017 and December 2020, Michael Montenes, the owner of M.S. Hi-Tech, Incorporated (MSHT), a Hauppauge-based distributor of electronic components, paid Anthony approximately $18,800 in bribes to induce her to enter into contracts for electronic components that MSHT supplied to the DOE’s Virginia laboratory. Montenes mailed these payments, which ranged from $500 to $7,200, from Long Island to Anthony in Virginia. In exchange for the bribes, Anthony awarded MSHT contracts worth more than $900,000, which represented 95% of all of MSHT’s sales to the DOE’s Virginia laboratory. In July 2021, some of the electronic components that Anthony procured from MSHT for DOE based upon Montenes’s bribes failed and caused a fire, resulting in approximately $1.8 million in repairs and other costs to DOE.
In May 2023, Montenes pleaded guilty to bribing Anthony. He also faces up to 15 years in prison. As part of his guilty plea, Montenes agreed to forfeit approximately $969,000 and to pay DOE more than $1.8 million in restitution.
The government’s case is being handled by the Office’s Long Island Criminal Division. Assistant United States Attorney Bradley T. King is in charge of the prosecution.
The Defendants:
JAMI ANTHONY
Age: 47
Hayes, VirginiaE.D.N.Y. Docket No. 23-CR-229 (JS)
Florida Attorney Deported to the United States After Being Charged with Sexually Abusing Children in CambodiaRead the Press Release
Tampa, Florida – United States Attorney Roger B. Handberg announces the return from Cambodia of Rugh James Cline (40, Tampa) for his first appearance after being charged in a federal indictment with five counts of engaging in illicit sexual conduct in a foreign place and one count of possessing child sex abuse materials. If convicted, Cline faces a maximum penalty of 30 years in federal prison for each count of engaging in illicit sexual conduct in a foreign place, and up to 20 years’ imprisonment for possessing child sex abuse materials. Cline made his initial appearance in federal court on June 7, 2023, in Tampa. On June 26, 2023, a bond hearing was held, and Cline was released on GPS monitoring, home detention, and a $100,000 signature bond. Cline is also not allowed to have access to the internet or to minors while on home detention.
According to the indictment, in February and May 2019, Cline, a U.S. citizen and Florida-licensed attorney living in Tampa, traveled to Cambodia. While in Cambodia, he paid to engage in sexual conduct on multiple occasions with four minors. The indictment also charges Cline with having traveled from the Middle District of Florida to Cambodia while knowingly possessing materials depicting the sexual abuse of young children.
An indictment is merely a formal charge that a defendant has committed one or more violations of federal criminal law, and every defendant is presumed innocent unless, and until, proven guilty.
This case was investigated by the Federal Bureau of Investigation, with assistance from the U.S. Department of State and the Cambodian National Police. The Justice Department’s Office of International Affairs provided assistance. The case will be prosecuted by Assistant United States Attorney Ilyssa M. Spergel.
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 United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Federal Inmate Sentenced to an Additional 10 Years in Prison for Threatening Federal Prosecutor and U.S. District JudgeRead the Press Release
FORT WORTH, Texas– A 58-year-old federal inmate has been sentenced for threatening a federal prosecutor and United States district judge, announced Eastern District of Texas U.S. Attorney Damien M. Diggs today.
Kevin Dean Riedle was sentenced to an additional 120 months in federal prison for retaliating against a United States judge and a federal law enforcement officer.
According to information presented in court, Riedle was previously convicted and sentenced in the Northern District of Texas for transporting and shipping child pornography. In 2022, while serving time in federal prison in Loretto, PA, Riedle mailed multiple letters to the Assistant United States Attorney who prosecuted him and to the United States district judge who sentenced him. In these letters, Riedle threatened, in gruesome detail, to violently murder the prosecutor, the judge, and their families in retaliation for his previous conviction and sentence.
This case was investigated by the Federal Bureau of Investigation and the U.S. Marshals Service and prosecuted by Eastern District of Texas Assistant U.S. Attorney Sean J. Taylor.
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Federal Grand Jury B Indictments Announced - June 2023Read the Press Release
TULSA, Okla. – United States Attorney Clint Johnson today announced the results of the June 2023 Federal Grand Jury B.
The following individuals have been charged with violations of United States law in indictments returned by the Grand Jury. The return of an indictment is a method of informing a defendant of alleged violations of federal law, which must be proven in a court of law beyond a reasonable doubt to overcome a defendant’s presumption of innocence.
Coby Dale Green. Malicious Use of Explosive Materials. Coby Dale Green, 24, is charged with malicious use of explosive materials after he, on or about Oct. 31, allegedly threw a Molotov cocktail into the Donut Hole donut shop located at 3305 South Peoria Avenue. The Bureau of Alcohol, Tobacco, Firearms and Explosives is the investigating agency. Assistant U.S. Attorneys Christopher J. Nassar and Nathan E. Michel are prosecuting the case. 23-CR-209
Lorenzo David Richey. Failure to Register as a Sex Offender. Lorenzo David Richey, 26, is charged with Failure to Register as a Sex Offender from on or about Dec. 5, 2022.The U.S. Marshals Service is the investigative agency. Assistant U.S. Attorney Cheryl L. Baber is prosecuting the case. 23-CR-210
Gerardo Alejandro Castro-Reyes. Unlawful Reentry of a Removed Alien. Gerardo Alejandro Castro-Reyes, 46, a Mexican national, is charged with unlawfully reentering the United States after having been removed on or about June 7, 2022, at or near Laredo Texas. U.S. Immigration and Customs Enforcement’s Enforcement and Removal Operations is the investigative agency. Assistant U.S. Attorney Cheryl L. Baber is prosecuting the case. 23-CR-208
Jose Luis Moreno-Yanez. Unlawful Reentry of a Removed Alien. Jose Luis Moreno-Yanez, 46, a Mexican national, is charged with unlawfully reentering the United States after having been deported and removed therefrom on or about Dec. 13, 2021, at or near Brownsville, Texas. U.S. Immigration and Customs Enforcement’s Enforcement and Removal Operations is the investigative agency. Assistant U.S. Attorney Cheryl L. Baber is prosecuting the case. 23-CR-211
Ex-Norman Car Dealership Executive Pleads Guilty to Tampering with Court ProceedingsRead the Press Release
OKLAHOMA CITY – United States Attorney Robert J. Troester announced that BOBBY CHRIS MAYES, 50, of Norman, pleaded guilty last Friday to two counts of tampering with official proceedings.
Public records reflect that Mayes was the former owner of the Big Red Dealerships (Big Red Sports/Imports, Big Red Kia, Norman Yamaha, Norman Mitsubishi, and Mayes Kia). On November 19, 2021, Mayes was convicted along with two co-defendants, including Courtney Dawn Wells, by a federal jury in Western District of Oklahoma Case Number CR-20-240-F. At that nearly three-week trial, Mayes was convicted of conspiring to commit wire fraud, 12 counts of wire fraud, six counts of uttering forged securities, and aggravated identity theft. Mayes is awaiting sentencing in that case.
Mayes was later indicted based on allegations that, from April through October of 2022, he tampered with the official proceedings in Case Number CR-20-240-F. More specifically, the indictment alleged Mayes orchestrated and helped to secure the unavailability of a key participant in the proceeding, fabricated e-mails and other evidence in an effort to secure a new trial in that prior case, and sent an anonymous e-mail to the Court as part of an effort to obtain a new trial in Case Number CR-20-240-F.
On June 23, 2023, Mayes appeared before United States District Court Judge Stephen Friot and pleaded guilty to two counts of tampering with official proceedings, pursuant to a plea agreement with the government. At the plea hearing, Mayes admitted he had helped to convince co-defendant Courtney Wells to flee to Mexico while they were awaiting sentencing and that he provided financial support for her flight. Wells and her companion, Brandon Landers, were later located in Mexico and returned to the United States. Landers was indicted and pleaded guilty on December 6, 2022, to conspiring to tamper with official proceedings based on his involvement in helping Wells flee to Mexico. Both Landers and Wells are awaiting sentencing in their respective cases.
At the plea hearing, Mayes also admitted he had sent an anonymous e-mail to the Court and others in early October 2022, in which he made untrue allegations about government conduct, in an effort to interfere with the ongoing proceedings. That anonymous e-mail was later used to attempt to delay certain parts of the case.
With each count of tampering with Court proceedings, Mayes faces a maximum penalty of twenty years in prison and a fine of up to $250,000. Mayes now awaits sentencing to be set at a later date for his fraud-related convictions and for the plea to tampering with Court proceedings.
This case is the result of an investigation by FBI’s Oklahoma City Field Office. Assistant U.S. Attorneys Thomas Snyder and Jacquelyn Hutzell are prosecuting the case.
Convicted Felon Is Sentenced to Prison for Illegal Gun PossessionRead the Press Release
CHARLOTTE, N.C. – Nike Apollo Perry, 30, of Mount Holly, N.C., was sentenced to 84 months in prison today for possession of a firearm by a felon, announced Dena J. King, U.S. Attorney for the Western District of North Carolina.
Terry Burgin, United States Marshal of the United States Marshals Service for the Western District of North Carolina, and Jamaal Thompson, Chief Inspector of the United States Marshals Service, Carolinas Regional Fugitive Task Force, join U.S. Attorney King in making today’s announcement.
According to filed court documents and today’s sentencing hearing, on May 17, 2022, the Carolinas Regional Fugitive Task Force (CRFTF) coordinated the arrest of Perry, who had outstanding arrest warrants for a federal supervised release violation and four felony state law violations. CRFTF members located Perry in Charlotte, and with the assistance of the Charlotte-Mecklenburg Police Department (CMPD) Aviation Unit conducted surveillance of Perry’s vehicle. Over the course of the surveillance, court records show that law enforcement observed Perry park his vehicle at an apartment complex in Charlotte. CRFTF members approached Perry and ordered him to step out of the vehicle. Perry was arrested at the scene without incident. At the time of the arrest, Perry was wearing a bulletproof vest.
According to court records, CRFTF members conducted a search of Perry’s vehicle and located a loaded semi-automatic pistol with a round loaded in the chamber and an attached 40-round magazine. Perry has a prior federal conviction for illegal gun possession and state convictions for second-degree murder and assault inflicting seriously bodily injury. As a result of those convictions, Perry is prohibited from possessing firearms or ammunition.
Perry is currently in federal custody. He will be returned to state custody to serve the remainder of his felony assault sentence and then be transferred to the custody of the federal Bureau of Prisons.
In making today’s announcement, U.S. Attorney King thanked the United States Marshals Service and the Carolinas Regional Fugitive Task Force for their investigation of the case and CMPD for their assistance with Perry’s arrest.
Assistant U.S. Attorney David Kelly of the U.S. Attorney’s Office in Charlotte prosecuted the case.
Connecticut Sex Offender Sentenced to 327 Months for Attempted Enticement of a MinorRead the Press Release
ALBANY, NEW YORK – David Feeney, age 57, of Bristol, Connecticut, was sentenced today to 327 months in prison for attempting to entice a minor to engage in sexual activity. United States Attorney Carla B. Freedman and Janeen DiGuiseppi, Special Agent in Charge of the Albany Field Office of the Federal Bureau of Investigation (FBI), made the announcement.
As part of his prior guilty plea, Feeney admitted that between March and April 2022, he exchanged sexually explicit messages online with people he believed were a father and a 10-year-old child, in an attempt to entice the child into engaging in sexual acts with him. Feeney also admitted that on April 24, 2022, he traveled from Connecticut and arrived unannounced at a residence in Albany County, New York, with the intent to engage in sexual acts with the 10-year-old child. Feeney was arrested by law enforcement shortly after arriving at the location. Feeney was a registered sex offender at the time of the offense; he had raped a child he had met online in 2011.
Chief United States District Judge Brenda K. Sannes also imposed a life term of post-imprisonment supervised release.
This case was investigated by the FBI and its Child Exploitation Task Force, which includes members of federal, state, and local law enforcement agencies, including the Colonie Police Department and New York State Police. Assistant United States Attorney Alexander Wentworth-Ping prosecuted this case as part of Project Safe Childhood.
Launched in May 2006 by the Department of Justice, Project Safe Childhood is led by United States Attorney’s offices and the Criminal Division’s 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 https://www.justice.gov/psc.
Chesapeake Man Pleads Guilty to Sex TraffickingRead the Press Release
NORFOLK, Va. – A Chesapeake man pleaded guilty today to sex trafficking a minor.
According to court documents, in September 2022, Denzel Akeem Loftin, 32, began chatting with an undercover law enforcement officer posing as a 17-year-old girl living in Pennsylvania. Loftin said he was a pimp and proposed that the girl come to Virginia to work for him. The next month, he posted advertisements for her on online sex trafficking sites. Then, in October 2022, the FBI learned of a 14-year-old missing child from Colorado who had been located in sex trafficking advertisements in the Hampton Roads area. Law enforcement set up a “date” for commercial sex with the 14-year-old and another juvenile. Loftin was observed with the girl and two other female individuals immediately before the appointment. One of the other individuals was identified as a missing 17-year-old from Missouri. A review of seized electronic devices revealed that Loftin not only sex-trafficked the minor but himself engaged in a sex act with the 17-year-old.
Loftin is scheduled to be sentenced on November 2, 2023. He faces a mandatory minimum penalty of 10 years in prison and maximum penalty 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.
Jessica D. Aber, U.S. Attorney for the Eastern District of Virginia, and Brian Dugan, Special Agent in Charge of the FBI’s Norfolk Field Office, made the announcement after U.S. Magistrate Judge Douglas E. Miller accepted the plea.
Assistant U.S. Attorney E. Rebecca Gantt is prosecuting the case.
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.
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 are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:23-cr-44.
Chesapeake Man Pleads Guilty to Sex TraffickingRead the Press Release
NORFOLK, Va. – A Chesapeake man pleaded guilty today to sex trafficking a minor.
According to court documents, in September 2022, Denzel Akeem Loftin, 32, began chatting with an undercover law enforcement officer posing as a 17-year-old girl living in Pennsylvania. Loftin said he was a pimp and proposed that the girl come to Virginia to work for him. The next month, he posted advertisements for her on online sex trafficking sites. Then, in October 2022, the FBI learned of a 14-year-old missing child from Colorado who had been located in sex trafficking advertisements in the Hampton Roads area. Law enforcement set up a “date” for commercial sex with the 14-year-old and another juvenile. Loftin was observed with the girl and two other female individuals immediately before the appointment. One of the other individuals was identified as a missing 17-year-old from Missouri. A review of seized electronic devices revealed that Loftin not only sex-trafficked the minor but himself engaged in a sex act with the 17-year-old.
Loftin is scheduled to be sentenced on November 2, 2023. He faces a mandatory minimum penalty of 10 years in prison and maximum penalty 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.
Jessica D. Aber, U.S. Attorney for the Eastern District of Virginia, and Brian Dugan, Special Agent in Charge of the FBI’s Norfolk Field Office, made the announcement after U.S. Magistrate Judge Douglas E. Miller accepted the plea.
Assistant U.S. Attorney E. Rebecca Gantt is prosecuting the case.
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.
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 are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:23-cr-44.
Central Valley Man Sentenced to over 6 Years in Prison for $9 Million Cow Manure Ponzi SchemeRead the Press Release
FRESNO, Calif. — Ray Brewer, 66, of Porterville, and Sheridan, Montana, was sentenced today to six years and nine months in prison for running a multimillion-dollar fraud scheme where he purported to turn cow manure into green energy, U.S. Attorney Phillip A. Talbert announced.
According to court records, from March 2014 through December 2019, Brewer stole $8,750,000 from investors by claiming to build anaerobic digesters on dairies in Fresno, Kern, Kings, and Tulare Counties, as well as other counties in California and Idaho. Anaerobic digesters are large machines that use microorganisms to break down biodegradable material and turn it into methane. The methane can then be sold on the open market as green energy. The methane also produces Renewable Energy Credits (REC), which represent the property right to the reduction in greenhouse gas emissions achieved through green energy creation. RECs are commonly purchased by companies to meet green energy regulatory, contractual, and initiative requirements or commitments. Brewer’s investors were supposed to receive 66% of all net profits as well as tax incentives.
Brewer made various misrepresentations to his investors. Brewer took investors on tours of dairies where he said that he was going to build the digesters and sent them forged lease agreements with the dairy owners. He also sent the investors altered agreements with banks that made it appear as though he had obtained millions of dollars in loans to build the digesters. Moreover, he sent the investors forged contracts with multinational companies that made it appear as though he had secured revenue streams. Finally, he sent the investors fake pictures of the digesters under construction. None of this was true.
Fake digester picture sent to investors
After Brewer received the investors’ money, he transferred the funds to multiple other bank accounts that he opened in the names of different entities, his family members, and an alias. He used false descriptions for the transfers. He did so to conceal the location, source, ownership, and control of the money before using it for personal expenditures. These expenditures included two plots of land that were 10 or more acres each, a 3,700 square foot custom home, and new Dodge Ram pickup trucks.
Brewer subsequently told his investors that the digesters were progressing when that was not the case. He did so by sending them fake documents: construction schedules, invoices for project-related costs, power generation reports, RECs, and pictures.
In some instances, Brewer purported to refund investors all or some of their money. The refunds, however, came from newly received money from other investors who had not authorized Brewer to use their money in this way. When Brewer’s investors realized the fraud and obtained civil judgments against him, he moved to Montana and assumed a new identity.
Upon his arrest, Brewer told officers that they had the wrong man. He also claimed to have been in the Navy and recalled how he once saved several soldiers during a fire by blocking the flames with his body so that they could escape. Brewer has since admitted that these were both lies meant to curry favor with law enforcement.
This case was the product of an investigation by the Internal Revenue Service, Criminal Investigation, the Federal Bureau of Investigation, and the Social Security Administration Office of Inspector General. Assistant U.S. Attorneys Joseph D. Barton, Henry Z. Carbajal III, and Alyson A. Berg prosecuted the case.
Canadian Man Sentenced to Lengthy Federal Prison Sentence for Scheme to Operate Illicit Online Gift Card MarketplaceRead the Press Release
United States Attorney Ronald C. Gathe, Jr. announced that Chief Judge Shelly D. Dick sentenced Richard Verret, age 41, of Quebec, Canada, to 57 months in federal prison following his conviction for operating a scheme to sell more than 500,000 stolen gift card account numbers over the internet. The Court also ordered Verret to forfeit more than $810,000 in proceeds from his crime.
In March 2022, after a multi-year investigation into Verret’s online criminal activity, a federal grand jury in Baton Rouge returned a six-count indictment charging Verret with the unauthorized solicitation of access devices and trafficking counterfeit access devices. On April 7, 2022, Verret was arrested at the Orlando International Airport after arriving in the United States from Canada. He was later transported to the Middle District of Louisiana to face the charges.
In September 2022, Verret pled guilty to the unauthorized solicitation of access devices. As he admitted in connection with his guilty plea, from 2018 through early 2022, he operated a series of websites, such as the “Lux Giftcards Shop” and “Miami’s Gift Card Shop,” through which he advertised the sale of gift cards for major restaurant chains, grocery stores, entertainment venues, and other retail business chains (collectively, the “businesses”). Many of the businesses whose gift cards were advertised on Verret’s websites had locations across Louisiana.
According to admissions made during his plea, Verret would use fraudulent methods and theft to obtain large quantities of valid gift card account numbers. Then, using various means to conceal his identity and avoid detection, Verret would sell the account numbers over the internet, offering the numbers for sale at steep discounts. Upon placing an order, a purchaser would generally receive instructions via e-mail directing him or her to send payment to a PayPal account controlled by the defendant, and after doing so, the purchaser would receive an e-mail containing account numbers for the gift cards that he or she had just purchased.
As of late February 2022, Verret’s then-current website offered more than 550,000 gift cards to more than 500 different businesses, and the total stored value of all of the fraudulently obtained accounts offered for sale was more than $22 million. The site advertised that it was adding more gift cards “every week.”
At today’s sentencing, Chief Judge Dick sentenced Verret to serve 57 months in federal prison and forfeit $812,893.60. In the event that Verret is deported from the United States following the completion of his federal prison sentence, he will be barred from re-entering the United States absent advance, formal approval. In addition, in connection with this case, the United States has also seized two of the domain names used by Verret in furtherance of his criminal activity, “www.miami24k.com” and www.miami.gift.
U.S. Attorney Gathe stated, “This case is a prime example of the length criminals are prepared to go to defraud victims. This scheme, if not caught, was well on its way to surpassing record gains for the defendant and record loss that injures both the purchaser and the advertised companies. Thank you to my entire team who worked with not only our local federal, city and state partners but also international partners as well. This should be a lesson to us all to be more cautious with providing our account information online. Please protect yourself by doing your research and if something seems suspicious or questionable, please notify the local authorities.”
This matter was investigated by the U.S. Department of Homeland Security—Homeland Security Investigations, in close collaboration with the Louisiana Attorney General’s Office. The investigation received substantial assistance from the East Baton Rouge Parish Sheriff’s Office, the U.S. Department of Justice’s Office of International Affairs, the Royal Canadian Mounted Police, and the Quebec Police Department. The matter was prosecuted by Assistant United States Attorney Alan A. Stevens, who also serves as Senior Litigation Counsel, and Assistant United States Attorneys Brad Casey and Harley W. Ferguson.
CEO of Education Company Sentenced for Causing Nearly $105M in Losses to Department of Veterans AffairsRead the Press Release
An Idaho man was sentenced today to five years in prison for his role in defrauding the Department of Veterans Affairs (VA) Post-9/11 GI Bill education benefit program, in the department’s largest Post-9/11 GI Bill fraud case.
According to court documents, Michael Bostock, 54, of Nampa, was the founder and CEO of California Technical Academy (CTA), a VA-approved school that offered technical training programs at three locations near Los Angeles and San Diego. From January 2012 through June 2022, Bostock and his co-conspirators made false and fraudulent representations to the VA regarding, among other things, veterans’ enrollment in approved courses of study, class attendance, and grades. Bostock and his co-conspirators also falsified course completion records to make it appear as if enrolled veterans completed their programs, when in fact, they had not. In order to conceal their scheme, Bostock and his co-conspirators falsified veterans’ contact information by substituting phone numbers that Bostock and his co-conspirators controlled to ensure that regulators could not contact the veterans. When regulators called the falsified phone numbers to obtain information about the school, Bostock and his co-conspirators impersonated students.
During the fraud scheme, the school received more than $32 million in tuition payments for approximately 1,793 veteran enrollees. During the same period, veterans enrolled in CTA’s VA-approved courses received over $72 million in education-related government benefits. In total, Bostock’s and his co-conspirators’ scheme to defraud the VA resulted in a total loss of nearly $105 million in government funds.
Co-defendants Eric Bostock and Philip Abod are scheduled to be sentenced on Oct. 19 for their roles in the scheme. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division and VA Inspector General Michael J. Missal made the announcement.
The VA Office of Inspector General investigated the case, with assistance from the Veterans Benefits Administration-Education Service.
Trial Attorneys Lauren Archer and Christina McGill of the Criminal Division’s Fraud Section prosecuted the case.
Browning man admits shooting, wounding man during argumentRead the Press Release
GREAT FALLS — A Browning man admitted today that he shot another man during an argument in Browning on the Blackfeet Indian Reservation, U.S. Attorney Jesse Laslovich said.
Johnathan Charles Gifford Oldchief, 24, pleaded guilty to assault resulting in serious bodily injury, assault with a dangerous weapon and using a firearm during a crime of violence. Oldchief faces a maximum of 10 years in prison, a $250,000 fine and three years of supervised release on the assault crimes and a mandatory minimum five years to life in prison, consecutive to any other sentence, a $250,000 fine and five years of supervised release on the firearm crime.
Chief U.S. District Judge Brian M. Morris presided. The court will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors. Sentencing was set for Nov. 16. Oldchief was detained pending further proceedings.
In court documents, the government alleged that on April 7, Oldchief spent the evening drinking heavily with others. Shortly after midnight, five persons left the house in a vehicle driven by Oldchief. After driving less than two blocks, Oldchief and the victim, identified as John Doe, got into a verbal argument. Oldchief stopped driving and another person intervened to keep the two from coming to blows. Oldchief ordered Doe out of the vehicle. Doe complied, and another person also got out. After driving a short distance, Oldchief stopped the vehicle. Removing a pistol from near the console, Oldchief got out, approached Doe, racked the pistol and shot him point blank one time. Oldchief returned to his car and left the scene. Others called emergency services. Doe was flown to a hospital in Great Falls where he underwent lifesaving surgery. Law enforcement recovered a live round and a spent shell casing from the scene. Officers also recovered a 9mm magazine in a search of the vehicle. The bullet and a description of the gun matched a 9mm pistol that Oldchief bought in February.
Assistant U.S. Attorney Kalah A. Paisley is prosecuting the case. The FBI and Blackfeet Law Enforcement conducted the investigation.
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Browning man admits assaulting corrections officer at Bureau of Indian Affairs jailRead the Press Release
GREAT FALLS — A Browning man suspected of trying to put a federal corrections officer in a chokehold while incarcerated at the Bureau of Indian Affairs’ jail on the Blackfeet Indian Reservation admitted to an assault charge today, U.S. Attorney Jesse Laslovich said.
Joseph Ernest Potts, 32, pleaded guilty to assault on a federal officer as charged in an indictment. Potts faces a maximum of 20 years in prison, a $250,000 fine and three years of supervised release.
Chief U.S. District Judge Brian M. Morris presided. The court will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors. Sentencing was set for Nov. 16. Potts was detained pending further proceedings.
The government alleged in court documents that on Aug. 15, 2021, Potts was in custody at the Browning jail, which is a federal correctional facility operated by the Bureau of Indian Affairs. A corrections officer, identified as John Doe, was supervising male inmates as they returned to their respective cells from the dayroom. Doe saw Potts pacing back and forth between his cell and a cell across the hallway. Potts then grabbed the officer around the neck and began struggling with him, attempting to put the officer in a chokehold. Other inmates had to intervene and pull Potts off the officer. The officer reported pain and discomfort for more than a week after the assault.
Assistant U.S. Attorney Kalah A. Paisley is prosecuting the case. The FBI, Bureau of Indian Affairs and Blackfeet Law Enforcement Services conducted the investigation.
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Brookfield Counselor Sentenced to 30 Months in Federal Prison for Defrauding Medicaid of More than $1 MillionRead the Press Release
Vanessa Roberts Avery, United States Attorney for the District of Connecticut, announced that GREGORY C. BANKS, 50, of Brookfield, was sentenced today by U.S. District Judge Michael P. Shea in Hartford to 30 months of imprisonment, followed by three years of supervised release, for health care fraud.
According to court documents and statements made in court, Banks owned and operated North East Counseling & Trauma Services and Gregory Banks Counseling, LLC. North East Counseling & Trauma Services, which had an office in Danbury, provided counseling services to individual patients, including those with mental health and trauma issues. Banks was enrolled individually as a Behavioral Health Clinician provider in the Connecticut Medicaid Program (“Medicaid”), but North East Counseling & Trauma Services and Gregory Banks Counseling LLC were never enrolled as providers in Medicaid.
Between January 2018 and July 2022, Banks submitted and caused to be submitted fraudulent claims to Medicaid for counseling services that were purportedly provided to Medicaid clients. Specifically, Banks submitted claims for dates of service when no services of any kind had been provided to the Medicaid clients identified in the claims.
In October 2020, the Connecticut Department of Social Services (DSS) audited Banks and his businesses and requested documentation from Banks for six sample clients. In response, Banks made multiple false statements for the purpose of delaying the progress of DSS’s audit and to conceal his offense. For example, in February 2021, Banks sent an email to DSS in which he falsely represented that one of the files DSS requested was destroyed by a water leak above his office when, in fact, no such water leak had occurred.
Through this scheme, Banks defrauded Medicaid of $1,044,387.08. Judge Shea ordered Banks to pay full restitution.
Banks, who is released on a $100,000 bond, is required to report to prison on September 8.
This investigation was conducted by the U.S. Department of Health and Human Services, Office of the Inspector General (HHS-OIG) and the Federal Bureau of Investigation. U.S. Attorney Avery acknowledged the valuable cooperation of the Connecticut Department of Social Services in the investigation.
This case was prosecuted by Assistant U.S. Attorney David T. Huang.
People who suspect health care fraud are encouraged to report it by calling 1-800-HHS-TIPS.
Bosque Farms Man Charged with AssaultRead the Press Release
ALBUQUERQUE, N.M. – Alexander M.M. Uballez, United States Attorney for the District of New Mexico, announced today that Daniel Vincent Olguin was arraigned on an indictment charging him with assault resulting in serious bodily injury, domestic assault by a habitual offender, and being a felon in possession of ammunition. Olguin, 36, of Bosque Farms, and an enrolled member of the Pueblo of Isleta, will remain in custody pending trial, which has not been scheduled.
A federal grand jury indicted Olguin on May 24. According to the indictment and other court records, on Aug. 9, 2022, Olguin assaulted his intimate partner, Jane Doe. As a result of the assault, Doe was diagnosed with a concussion.
An indictment is only an allegation. A defendant is presumed innocent unless and until proven guilty. If convicted, Olguin faces up to 15 years in prison.
The Isleta Police Department investigated this case. Assistant United States Attorney Robert James Booth II is prosecuting the case.
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Bogalusa Man Sentenced for Violating the Federal Gun Control and Federal Controlled Substances ActsRead the Press Release
NEW ORLEANS, LOUISIANA – CARLOS WALKER, age 33, a resident of Bogalusa, Louisiana, was sentenced on June 20, 2023 by United States District Judge Wendy B. Vitter to 87 months’ imprisonment, three years of supervised release, and a mandatory $300.00 special assessment fee after pleading guilty to one count of being a felon in possession of a firearm in violation of Title 18, United States Code, Sections 922(g)(1) and 924(a)(2), one count of possession with intent to distribute a quantity of a mixture or substance containing a detectable amount of methamphetamine in violation of Title 21, United States Code, Sections 841(a)(1) and (b)(1)(C), and one count of possession of a firearm in furtherance of a drug trafficking crime, in violation of Title 18, United States Code, Section 924(c)(1)(A), announced U.S. Attorney Duane A. Evans. The sentence consisted of 27 months’ imprisonment for the felon in possession and possession with intent to distribute counts and 60 months’ imprisonment for the possession in furtherance of a drug trafficking crime count, to run consecutive to the 27-month sentence.
According to court documents, on September 24, 2021, Bogalusa Police Department officers observed a black Nissan Altima with a non-functioning headlight driving in Bogalusa, Louisiana. After stopping and approaching the vehicle, the officers saw WALKER in the front passenger seat kicking his legs as if he was shoving something under the seat. One of the officers recognized WALKER and remembered that a warrant had been issued for his arrest.
After the confirming the warrant, the officers arrested and searched WALKER, locating approximately $4,000.00 in his pocket. Officers also saw a Taurus Model G2C, nine-millimeter handgun under the passenger seat and located a small clear wrap containing seventeen (17) grams of methamphetamine in the front passenger door pocket. A review of WALKER’s criminal record revealed that he had a prior felony drug conviction for drug and firearm violations.
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 gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Bogalusa Police Department, and the St. Tammany Parish Sheriff’s Office. The prosecution was handled by Assistant United States Attorney André Jones of the Narcotics Unit.
Baltimore Man Sentenced to 54 Months in Federal Prison for Possession of a Stolen Firearm and for Possession with Intent to Distribute Methamphetamine and CocaineRead the Press Release
Baltimore, Maryland – U.S. District Judge Deborah L. Boardman today sentenced Davon Hemphill, age 40, of Baltimore, Maryland, to 54 months in federal prison, followed by three years of supervised release, for possession of a stolen firearm and for possession with intent to distribute controlled substances.
The sentence was announced by United States Attorney for the District of Maryland Erek L. Barron; Special Agent in Charge Toni M. Crosby of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) Baltimore Field Division; Acting Commissioner Richard Worley of the Baltimore Police Department.
According to his guilty plea, on January 1, 2022, Baltimore Police Department officers were monitoring a closed-circuit television (“CCTV”) camera that captured the area between the intersections of Carey and Baltimore Street and Carey and Hollins Street, an area known for its high level of drug activity and violence. Officers saw Hemphill make two hand-to hand exchanges, which officers believed were drug transactions. Officers also noted that Hemphill was wearing clothing identical to clothing worn by a person of interest in a homicide that had occurred in the same area the prior week.
As detailed in the plea agreement, the officers relayed their observations to other officers in the area so they could initiate a stop. The responding officers walked north on Carey Street and saw Hemphill walking toward them. As the officers walked toward him, Hemphill fled, holding his front waistband area as if he were supporting the weight of an object, which the officers suspected was a firearm. After a short foot-chase, Hemphill was arrested. A subsequent search of his person recovered a stolen 9mm handgun loaded with seven rounds of ammunition, approximately 65 pills of methamphetamine, one small vial containing a white rock substance, later determined to be cocaine, approximately $2,843 in cash, one clear plastic bag and one clear green flip-top container containing suspected marijuana, and a cell phone.
Hemphill admitted that he possessed the methamphetamine and cocaine with the intent to distribute them and that he knew or had reasonable cause to believe that the firearm was stolen at the time that he possessed it.
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 gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results.
United States Attorney Erek L. Barron commended the ATF and the Baltimore Police Department for their work in the investigation. Mr. Barron thanked Assistant U.S. Attorneys Jonathan S. Tsuei and Patricia C. McLane, who prosecuted the case.
For more information on the Maryland U.S. Attorney’s Office, its priorities, and resources available to help the community, please visit https://www.justice.gov/usao-md/project-safe-neighborhoods-psn and https://www.justice.gov/usao-md/community-outreach.
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Baltimore Man Sentenced to 14 Months in Federal Prison for Fraudulently Obtaining More Than $1.2 Million in COVID-19 CARES Act LoansRead the Press Release
Baltimore, Maryland – Chief U.S. District Judge James K. Bredar sentenced Alexander Barabash, age 52, of Baltimore, Maryland, today to 14 months in federal prison, followed by six months of home detention as part of three years of supervised release, for wire fraud relating to the submission of fraudulent Coronavirus Aid, Relief, and Economic Security (“CARES”) Act loan applications. The CARES Act was enacted in March 2020 to provide emergency financial assistance to Americans suffering from the economic effects caused by the COVID-19 pandemic.
Chief Judge Bredar ordered that Barabash pay a fine of $400,000, a money judgment in the amount of $1,295,000 and pay restitution of $1,317,352.05. Barabash must forfeit $504,869.54 in funds seized from the iDesignBuild business bank account and his interest in a property in Sparks Glencoe, Maryland, both of which will be applied to the money judgment.
The sentence was announced by United States Attorney for the District of Maryland Erek L. Barron; Acting Special Agent in Charge Kareem A. Carter of the Internal Revenue Service - Criminal Investigation, Washington, D.C. Field Office; and Special Agent in Charge Ross Luciano of the United States Secret Service - Baltimore Field Office.
Financial assistance offered through the CARES Act included forgivable loans to small businesses for job retention and certain other expenses, through the Paycheck Protection Program (“PPP”), administered through the Small Business Administration (“SBA”) and participating lenders.
According to his plea agreement, between April 2020 and January 2021, Barabash submitted three fraudulent PPP loan applications on behalf of his construction company iDesignbuild LLC (“iDesignBuild”).
As detailed in the plea agreement, on April 9, 2020, Barabash, the CEO of iDesignBuild, submitted a PPP loan application falsely stating that the company had four employees and an average monthly payroll of $18,750. In fact, the company did not have any employees, but engaged independent contractors for work-related matters. Based on the representations made in the fraudulent application, on April 23, 2020, Barabash received $46,800 in PPP loan proceeds in the iDesignBuild bank account. On April 25, 2020, Barabash submitted a second fraudulent PPP loan application on behalf of iDesignBuild, stating that the company had seven employees and an average monthly payroll of $38,777.60. In support of the application, Barabash submitted IRS Forms 941 for each quarter of 2019 and a 2019 IRS Form 940 for iDesignBuild, signed by Barabash and his tax preparer, knowing that they had never been filed with IRS.
Barabash admitted that on January 20, 2021, he submitted a third fraudulent loan application on behalf of iDesignBuild, representing that the company had 37 employees and an average monthly payroll of $525,227. In support of the application, Barabash again submitted fraudulent IRS Forms 941 for each quarter of 2019 and a fraudulent 2019 IRS Form 940. Compared to the fraudulent forms submitted with the unsuccessful April 25, 2020 PPP loan application, the forms submitted in January 2021 reported more than six times the number of employees and nearly $1.5 million more in wages in each quarter. The forms were again signed by Barabash and his tax preparer. Barabash knew that the forms did not accurately reflect iDesignBuild’s wages or revenues, nor had they been filed with the IRS. Based on Barabash’s false representations, the bank funded a PPP loan of $1,295,000, which was credited to iDesignBuild’s bank account on February 26, 2021.
Barabash used the fraudulently obtained loans to facilitate the purchase of two properties in Sparks Glencoe, Maryland, and to purchase a 2016 Chevrolet Corvette. Barabash admitted that he knew those were not permissible uses of PPP funds and the transactions would not have been made without the receipt of the PPP funds.
The District of Maryland Strike Force is one of three strike forces established throughout the United States by the U.S. Department of Justice to investigate and prosecute COVID-19 fraud, including fraud relating to the CARES Act. The strike forces focus on large-scale, multi-state pandemic relief fraud perpetrated by criminal organizations and transnational actors. The strike forces are interagency law enforcement efforts, using prosecutor-led and data analyst-driven teams designed to identify and bring to justice those who stole pandemic relief funds.
For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus. Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
United States Attorney Erek L. Barron commended the IRS-CI and U.S. Secret Service for their work in the investigation. Mr. Barron thanked Assistant U.S. Attorney Darryl L. Tarver, who is prosecuting the case. He also recognized the assistance of the Maryland COVID-19 Strike Force Paralegal Specialist Joanna B.N. Huber and Paralegal Specialist Juliette Frase.
For more information on the Maryland U.S. Attorney’s Office, its priorities, and resources available to help the community, please visit www.justice.gov/usao/md.
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Attorney and Former U.S. Congressional Candidate Indicted for Defrauding Clients of More Than $5 Million in Escrow FundsRead the Press Release
BOSTON – An attorney and former candidate for the U.S. House of Representatives was arrested today in connection with a scheme to defraud a business-to-business supply company based in India of millions of dollars and using client funds for business and personal expenses, including the purchase of a $2.7 million home in Boca Raton, Fla.
Abhijit Das, a/k/a “Beej,” 50, of North Andover, was indicted by a federal grand jury in Boston on June 20, 2023 on 10 counts of wire fraud. Das was arrested today in Fort Lauderdale, Fla. and appeared in the Southern District of Florida this afternoon. In June 2021, Das was arrested for allegedly violating the Federal Election Campaign Act and false statements.
According to the indictment, Das was an attorney and principal manager of a boutique law and advisory firm called Troca Global Advisors with offices in Boston and New York. Beginning in or about May 2020, Das began providing legal representation and escrow services to two twin brothers and their logistical supply company in India that was coordinating large shipments Personal Protective Equipment (PPE) during the pandemic.
The indictment alleges that Das diverted more than $5 million in escrow funds from his clients’ accounts to other accounts and used the funds for personal expenses – including expenses for his law firm, a yacht owned by one of his hotels, as well as $2.7 million for his Boca Raton home. . Das allegedly induced his clients to transfer funds to accounts he controlled in multi-step, layered transactions under the guise of legal advice about the risk of potential litigation and provided clients with fraudulent and forged account statements to conceal the scheme.
The indictment further alleges that Das committed nine of the 10 counts of wire fraud while on court mandated pre-trial release conditions resulting from his June 2021 indictment. That earlier indictment charged Das with campaign finance violations, embezzlement of campaign funds and making materially false statements to the Federal Election Commission.
The charges of wire fraud each provide for a sentence of up to 20 years in prison, three years of supervised release and fine of $250,000, or twice the gross gain or loss, whichever is greater. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and statutes which govern the determination of a sentence in a criminal case.
Acting United States Attorney Joshua S. Levy; Christopher DiMenna, Acting Special Agent in Charge of the U.S. Federal Bureau of Investigation, Boston Division; and Joleen D. Simpson, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigations in Boston made the announcement today. Assistant U.S. Attorney Neil J. Gallagher Jr. of Levy’s Public Corruption & Special Prosecutions Unit is prosecuting the case.
The details contained in the indictment are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Armed Lumberton Drug Trafficker Sentenced to More than 17 Years in PrisonRead the Press Release
RALEIGH, N.C. – Corey Wellman, 35, of Lumberton, North Carolina was sentenced today to 210 months in prison for gun and drug crimes.
In October of 2019, the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) in coordination with the Lumberton Police Department initiated in investigation into Corey Wellman and his associates for drug and gun trafficking. In December and January, Law enforcement oversaw controlled purchases of crack cocaine from Wellman ranging from a quarter of an ounce to an ounce. During these transactions, Wellman was often seen possessing a firearm. The transactions took place at Wellman’s stash house at 44 Van Born Drive, which is located in an area known for criminal activity, including shootings.
Michael Easley, U.S. Attorney for the Eastern District of North Carolina, made the announcement after sentencing by U.S. District Judge James C. Dever III. The Bureau of Alcohol, Tobacco, Firearms, and Explosives, Lumberton Police Department, and Robeson County Sheriff’s Office investigated the case and Assistant U.S. Attorney Chad Rhoades and Special Assistant United States Attorney Lisa Labresh prosecuted the case.
Related court documents and information can be found on the website of the U.S. District Court for the Eastern District of North Carolina or on PACER by searching for Case No. 7:20-CR-184-D.
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Alliance Man Sentenced for Firearm and Drug Trafficking CrimesRead the Press Release
United States Attorney Steven Russell announced that Ryan Arrants, 43, of Alliance, Nebraska, was sentenced today in federal court in Omaha, Nebraska, for possession with intent to distribute methamphetamine and possessing a firearm in furtherance of a drug trafficking crime. United States District Judge Brian C. Buescher sentenced Arrants to 180 months of imprisonment. There is no parole in the federal system. After his release from prison, Arrants will begin a five-year term of supervised release.
On April 20, 2021, law enforcement in Alliance conducted a controlled purchase of methamphetamine and a Ruger handgun from Arrants. A confidential informant went to Arrants’s residence and purchased the methamphetamine and the handgun for $450.
On August 9, 2021, officers executed a search warrant of Arrants’s Alliance residence and located approximately 115 grams of methamphetamine. Arrants was knowingly in possession of the methamphetamine and intended to distribute it.
This case was investigated by the Alliance Police Department, the Scottsbluff Police Department, the WING Drug Task Force, and the Nebraska State Patrol.
Accessory to Zambia Safari Murder Sentenced to 17 Years in Federal PrisonRead the Press Release
DENVER –The United States Attorney’s Office for the District of Colorado announces that Lori Milliron, 65, formerly of Paradise Valley, Arizona, was sentenced to 17 years in federal prison for her role as an accessory in the murder of Bianca Rudolph. Milliron had previously been convicted of being an accessory after the fact to murder, obstruction, and two counts of perjury before a grand jury after a trial last summer. The jury acquitted her of three other counts of perjury.
Evidence presented at trial proved beyond a reasonable doubt that Lawrence Rudolph murdered his wife Bianca while the two were on a hunting trip in Zambia on October 11, 2016. Rudolph shot his wife through the heart with a 12-gauge shotgun that was enclosed in a soft-shell case on the last day of a scheduled hunt, scheming to make the murder look like an accident. Upon his return to the United States, Rudolph filed false and fraudulent claims on nine separate life insurance policies issued by seven different companies to obtain $4,877,744.93.
Lori Milliron was subpoenaed to provide information to the grand jury investigating Bianca’s death. During her appearance, on January 5, 2022, she lied and otherwise obstructed that investigation to help Rudolph avoid prosecution. Asked about the nature of her relationship with Rudolph and the purpose of cash payments Rudolph had made to her before Bianca’s death, she testified that she didn’t know why and that Rudolph was simply being generous. But it was actually because she was Rudolph’s long-time mistress. Asked about what Rudolph had told her after he found out he was under investigation by the FBI, Milliron told the grand jury that Rudolph was irritated by the investigation because he was “probably innocent;” actually, Rudolph had told her in Spring 2020 that “I killed my (expletive) wife for you.”
The Court granted an upward variance from the sentence recommended by the United States Sentencing Guidelines, referencing the underlying nature of the murder and trial evidence indicating that it was more likely than not that Milliron aided and abetted its execution by helping Rudolph obtain several vials of propofol, an anesthetic drug that is deadly at certain doses, before two of Rudolph and Bianca’s scheduled Zambian safaris. The Court also referenced Milliron’s torment of the victim’s family, and her lack of remorse. In addition to a sentence of 204 months in federal prison, the Court imposed the maximum fine of $250,000.
“Justice has arrived for Lori Milliron,” said United States Attorney Cole Finegan. “We thank our partners at the FBI, as well as our prosecutors and professional staff, who have worked tirelessly to ensure that this Defendant would not evade responsibility for her role in this terrible murder.”
United States Senior District Judge William J. Martinez presided over the sentencing. The sentencing for co-defendant Lawrence Rudolph was recently vacated and will be re-set at an appropriate time after the parties have consulted with one another and the Court.
The investigation in this case was conducted by the FBI Denver Division. The prosecution is being handled by Assistant U.S. Attorneys Bryan Fields, Garreth Winstead, and Bishop Grewell.
CASE NUMBER: 22-cr-00012-WJM-2
23 June 2023
York County Man Sentenced to Probation for Theft of Federal Program FundsRead the Press Release
HARRISBURG – The United States Attorney’s Office for the Middle District of Pennsylvania announced that Leonard Hart, age 50, of Mount Wolf, PA was sentenced to five years of probation for obtaining by fraud and misapplying money from Lincoln Charter School (LCS) in York, Pennsylvania.
According to United States Attorney Gerard M. Karam, LCS is a recipient of federal program funds because it receives grants funded by the U.S Department of Education—primarily Title I funding, which is financial assistance for schools with high numbers of children from low-income backgrounds.
From 2013 until November 2021, Hart was LCS’s Principal and CEO. LCS offers a program by which employees are able to get partial tuition reimbursement for furthering their education. Hart misrepresented that he was pursuing a Ph.D. and submitted numerous requests for reimbursement for courses that he falsely claimed he was taking from a couple of universities. He also falsified records to support these claims for tuition reimbursement and pressured a lower-level employee of the school and former LCS student to assist him in creating a forged diploma.
Hart admitted to submitting to LCS nearly 20 false and fraudulent reimbursement between 2018 and 2020. Hart was also ordered to pay $55,311 in restitution, representing the total amount of funds he received through fraudulent reimbursement requests. At sentencing, Hart presented a check for $10,000 toward his total restitution payments.
The case was investigated by the Federal Bureau of Investigation. Assistant U.S. Attorney Ravi Romel Sharma prosecuted the case.
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Yo Enkilpe Yon Mesye Ki Abite Coral Springs poutèt Li Tap Jere Yon Konplo Ponzi Ki Rapòte 100 Milyon Dola Atravè Konpayi Kamyon Li aRead the Press Release
MIAMI – Yo arete Sanjay Singh ki gen 43 lane e ki soti Coral Springs, Florida. Yon tribinal federal nan Sid Florid la enkilpe misye pou fròd nan yon envestisman ki rapòte 100 milyon dola ke li monte a travè yon konpayi kamyon li genyen ki rele Royal Bengal Logistics, Inc. (“RBL”).
Genyen yon rekizitwa kont Singh ki gen ladanl akizasyon ki di Singh vyole lwa federal ki penalize konplo pou komèt fwòd elektwonik, fwòd elektwonik ak patisipasyon nan tranzaksyon ki rapòte lajan ilegal.
Dapre enkilpasyon an, Singh, fondatè e prezidan RBL, te òganize epi dirije yon konplo Ponzi ak lòt konplis. Komplo a kòmanse an janvye 2020 e li te kontinye jiskaske yo arete misye. Singh ak konplis li yo te prezante RBL bay potansyèl envestisè yo tankou yon biznis kamyon ki pwospè e k ap byen mache, pandansetan antrepiz la ap pèdi lajan.
Nan mouvman sa, Singh ak akolit li yo te fè fo deklarasyon ak omisyon enpòtan sou risk ki genyen nan envesti nan RBL, rantabilite operasyon kamyon RBL yo, kijan RBL ta pral peye envestisè yo, epi kijan RBL ta pral itlize lajan envestisè yo. Atravè fo deklarasyon ak omisyon enpòtan sa yo, Singh ak konplis li yo pran plis pase 100 milyon dola nan men envestisè yo. Singh ak akolit li yo te itilize yon pati nan lajan sa a pou peye envestisè yo enterè yo te pwomèt yo.
Rekizitwa a akize Singh kòmkwa li detounen plizyè milyon dola ki soti nan lajan envestisè yo pou repare kay li, peye ipotèk li, peye pou depans pèsonèl li ak envesti nan mache bousye a.
Si yo kondane l pou tout akizasyon ki nan rekizitwa a, Singh ap fè fas ak yon maksimòm total 150 lane nan prizon.
Markenzy Lapointe, Avoka Gouvènman Ameriken nan Distri Sid Eta Florid, Jeffery B. Veltri, Ajan Espesyal an Chaj nan Biwo FBI nan Miami, Todd A. Damiani, Ajan Espesyal an Chaj nan Biwo Enspektè Jeneral Depatman Transpò (ʺDOT-OIGʺ), Rejyon Sid ak Russell Weigel III, Komisyonè Biwo Règleman Finansyè Florid (ʺOFRʺ) fè anons la.
Avoka Gouvènman Ameriken an, Lapointe, felisite efò envestigasyon FBI, DOT-OIG ak OFR sou dosye sa. Li remèsye Biwo Rejyonal Komisyon Sekirite ak Echanj Ameriken nan Miami pou asistans yo. Asistan Avoka Gouvènman Ameriken, Kiran N. Bhat, ap pouswiv ka a. Asistan Avoka Gouvènman Ameriken, Marx Calderon, ap okipe konfiskasyon byen yo.
Yon enkilpasyon se sèlman yon akizasyon, epi yon akize inosan jiskaske yo pwouve li koupab.
Si w te envesti nan RBL, si RBL dwe w lajan oswa ou te konn pale ak nenpòt moun nan RBL konsènan yon potansyèl envestisman nan RBL, silvouplè vizite https://www.fbi.gov/how-we-can-help-you/victim-services/seeking-victim-information/rblinvestors pou w bay FBI bon jan enfòmasyon. Ou ka vizite tou https://www.fbi.gov/how-we-can-help-you/victim-services/seeking-victim-information/rblinvestors-french pou w bay enfòmasyon an Fransè Ayisyen oswa https://www.fbi.gov/how-we-can-help-you/victim-services/seeking-victim-information/rblinvestors-haitian-creole pou bay enfòmasyon an Kreyòl.
Ou ka jwenn dokiman ak enfòmasyon ki gen rapò ak tribinal la sou sit wèb Tribinal Distri pou Distri Sid Florid la nan www.flsd.uscourts.gov oswa nan http://pacer.flsd.uscourts.gov chèche nan nimewo sa : 23-60117-CR (S.D.Fla.).
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Worcester Man Previously Charged with Possessing Machinegun Indicted on Additional Drug-Related ChargesRead the Press Release
BOSTON – A Worcester man who was previously charged with unlawfully possessing a machinegun has been indicted by a federal grand jury in Worcester on drug charges.
Jose Rivera, 24, was charged in a superseding indictment with possession of a machinegun, receipt of a firearm by a person under indictment for a felony, possession with intent to distribute cocaine and possession of a firearm in furtherance of a drug trafficking crime. Rivera will appear in federal court in Worcester at a later date.
According to the charging documents, during a search of Rivera’s residence on March 7, 2023, three Glock switches – including one attached to a Glock .40 caliber firearm were recovered. Glock switches convert semi-automatic Glock pistols into fully automatic machineguns and are considered machineguns under federal law. It is alleged that Rivera also possessed cocaine intended for distribution. It is further alleged that Rivera received the Glock .40 caliber firearm at some point on or after Oct. 9, 2021, while he was under indictment in state court for a felony punishable by a term of imprisonment of over a year.
The charge of unlawful possession of a machinegun provides for a sentence of up to 10 years in prison, up to three years of supervised release and a fine of up to $250,000. The charge of receipt of a firearm while under indictment provides for a sentence of up to five years in prison, up to three years of supervised release and a fine of up to $250,000. The charge of possession with intent to distribute cocaine provides for a sentence of up to 20 years in prison, up to three years of supervised release and a fine of up to $1 million. The charge of possession of a firearm in furtherance of a drug trafficking crime provides for a mandatory minimum sentence of five years, to be run consecutively with the sentence imposed on the other counts, up to three years of supervised release and a fine of up to $250,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and statutes which govern the determination of a sentence in a criminal case.
Acting United States Attorney Joshua S. Levy; James M. Ferguson, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms & Explosives, Boston Field Division; and Worcester Police Chief Steven M. Sargent made the announcement today. Assistant U.S. Attorney Kaitlin Brown of Levy’s Worcester Branch Office is prosecuting the case.
This case is also a 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 gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results.
The details contained in the charging documents are allegations. The remaining defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Wilmington Doctor to Pay $170,000 to Resolve Allegations of Unlawful Prescribing of OpioidsRead the Press Release
WILMINGTON, N.C. – Dr. Mark S.T. Armitage, a physician practicing with Pelican Family Medicine in Wilmington, North Carolina, agreed to pay $170,000 to resolve alleged violations of the Controlled Substances Act. Dr. Armitage, who previously surrendered his Drug Enforcement Administration (DEA) registration to prescribe controlled substances, further agreed not to reapply for authorization to prescribe Schedule II controlled substances until April 30, 2024. The settlement was announced by Michael F. Easley, Jr., United States Attorney for the Eastern District of North Carolina.
Based on its investigation, the United States contended that from approximately 2009 until 2018, Dr. Armitage issued prescriptions for opioids and other controlled substances outside the usual course of professional practice and not for a legitimate medical purpose. For example, Dr. Armitage allegedly wrote prescriptions for “The Trinity”—the combination of an opioid, a benzodiazepine, and a muscle relaxer, which is frequently sought by drug abusers—on nearly 400 separate occasions between 2016 and 2018. In total, Dr. Armitage allegedly wrote nearly 9,000 prescriptions for Schedule II controlled substances, like oxycodone, over that two-year time-period.
The United States’ investigation followed a 2018 Consent Order entered by the North Carolina Medical Board, in which Dr. Armitage acknowledged that his multi-year prescribing of opioids and other controlled substance to one patient, who was a mother of four, “constitute[d] a departure from or a failure to conform to the standards of acceptable and prevailing medical practice.” Dr. Armitage continued to prescribe the patient opioids and other controlled substances even after the patient exhibited numerous warnings signs of abuse, experienced significant weight loss, and went into acute narcotic withdrawal. The patient was ultimately involuntarily admitted for addiction detoxification.
“Doctors take an oath to, first, do no harm. Anything else is unacceptable, especially when it comes to prescribing opioids and other dangerous drugs. Irresponsible doctors endanger their patients’ lives and can put a tremendous toll on society at large,” said United States Attorney Michael F. Easley, Jr. “This case is just one part of our our continued commitment to combat the opioid crisis by holding doctors accountable for compliance with the Controlled Substances Act.”
The resolution obtained in this matter was the result of a coordinated effort between the United States Attorney’s Office for the Eastern District of North Carolina and the Drug Enforcement Administration, Diversion Control Program. Assistant United States Attorneys Michael Anderson and Andrew Kasper represented the United States.
The United States’ factual and legal assertions are allegations only, and there has been no admission or judicial determination of liability. The civil settlement agreement is not an admission of any liability by Dr. Armitage, nor a concession by the United States that its potential claims were not well-founded.
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West Boylston Man Pleads Guilty to Drug Offense and Wire FraudRead the Press Release
BOSTON – A West Boylston man has pleaded guilty in federal court in Worcester to possessing cocaine intended for distribution and wire fraud with respect to COVID-19 relief programs.
Augustus “Bobo” Kormah, 33, pleaded guilty on June 20, 2023 to one count of possession with intent to distribute cocaine and two counts of wire fraud. U.S. Senior District Court Judge Timothy S. Hillman scheduled sentencing for Oct. 18, 2023. Kormah was indicted by a federal grand jury in March 2021.
On Sept. 11, 2020, Kormah was arrested following a suspected drug transaction. During a search of Kormah’s apartment, approximately 26 grams of cocaine and ammunition was seized. Additionally, between approximately May and October 2020, Kromah used personal information of others to submit false claims for COVID-19 unemployment benefits and small business loans.
The charge of possession with intent to distribute cocaine provides for a sentence of up to 20 years in prison, at least three years of supervised release and a fine of up to $1 million. The charges of wire fraud provide for a sentence of up to 20 years in prison, three years of supervised release and a fine of up to $250,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and statutes which govern the determination of a sentence in a criminal case.
Acting United States Attorney Joshua S. Levy; James M. Ferguson Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms & Explosives, Boston Field Division; Andrew Murphy, Special Agent in Charge of the United States Secret Service, Boston Field Office; Jonathan Mellone, Special Agent in Charge of Department of Labor, Office of Inspector General; and Worcester Police Chief Steven Sargent made the announcement. Assistant U.S. Attorney Lucy Sun of Levy’s Criminal Division and Danial Bennett of Levy’s Worcester Branch Office are prosecuting the case.
This case is a 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 gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results.Un homme de Coral Springs accusé d’avoir opéré un système de Ponzi de 100 millions de dollars par l’intermédiaire de son entreprise de camionnageRead the Press Release
MIAMI – Sanjay Singh, 43 ans, de Coral Springs, en Floride, a été arrêté et accusé devant la cour fédérale de Floride du Sud d'avoir orchestré une fraude à l'investissement (Ponzi) de 100 millions de dollars menée par son entreprise de camionnage routier, Royal Bengal Logistics, Inc. (« RBL »).
L’acte d’accusation contre Singh allègue qu’il a violé les lois fédérales criminalisant le complot pour commettre une fraude de fil et se livrer à des transactions de produits illicites.
Selon l'acte d'accusation, Singh, fondateur et président de RBL, a organisé et dirigé un important système de Ponzi avec des complices. Le complot a commencé en janvier 2020 et se poursuivait au moment de son arrestation. Singh et ses complices ont présenté RBL auprès d’investisseurs potentiels comme étant une entreprise de camionnage florissante et prospère, alors que l’entreprise réelle de camionnage de RBL perdait de l’argent. Au cours du processus, Singh et ses collaborateurs ont fait des déclarations erronées et des omissions importantes au sujet du risque d’investir dans RBL, de la rentabilité des activités de camionnage de RBL, de la façon dont RBL paierait ses investisseurs et de la façon dont RBL utiliserait les fonds des investisseurs. Par ces fausses déclarations et omissions importantes, Singh et ses complices ont recueilli plus de 100 millions de dollars auprès des investisseurs, laquelle somme a été utilisée en partie par Singh et ses complices pour payer les rendements promis aux investisseurs existants.
L'acte d'accusation allègue également que Singh a détourné des millions de dollars de fonds d'investisseurs pour rénover sa maison, effectuer des paiements hypothécaires, payer pour ses dépenses personnelles et faire du commerce des actions sur marge.
S’il est reconnu coupable de toutes les accusations portées dans l’acte d’accusation, Singh risque une peine maximale totale de 150 ans d’emprisonnement. Un juge du tribunal fédéral de district déterminera toute peine après avoir pris en considération les Lignes directrices des États-Unis statuant sur la condamnation et d'autres facteurs légaux.
Markenzy Lapointe, Procureur du district sud de la Floride aux États-Unis; Jeffrey B. Veltri, Agent spécial du FBI en charge au Bureau régional de Miami ; Todd A. Damiani, Agent spécial du Bureau de l’inspecteur général pour le département des transports (« DOT-OIG »), région sud; et Russell Weigel III, Commissaire, Office de régulation financière de Floride (« OFR »), ont fait l'annonce.
Le procureur des États Unis Lapointe a salué les efforts d'enquête du FBI, du DOT-OIG et de l'OFR dans cette affaire. Il a remercié le bureau régional de la La Securities and Exchange Commission (SEC) des États-Unis à Miami pour son assistance. Le procureur adjoint des États Unis Kiran N. Bhat poursuit l'affaire. Le procureur adjoint des États Unis Marx Calderon s’occupe de la confiscation des biens.
Un acte d'accusation n'est qu'une accusation et un accusé est présumé innocent jusqu'à preuve du contraire.
Si vous avez investi dans RBL, si RBL vous doit de l’argent ou si vous avez eu des interactions avec une personne de RBL au sujet d'un investissement potentiel, veuillez consulter le site https://www.fbi.gov/how-we-can-help-you/victim-services/seeking-victim-information/rblinvestors pour fournir des informations pertinentes au FBI. Vous pouvez également visiter le site https://www.fbi.gov/how-we-can-help-you/victim-services/seeking-victim-information/rblinvestors-french pour fournir des informations en français haïtien, ou https://www.fbi.gov/how-we-can-help-you/victim-services/seeking-victim-information/rblinvestors-haitian-creole pour fournir des informations en créole haïtien.
Des documents et des informations judiciaires connexes peuvent être trouvés sur le site Web du tribunal du district sud de la Floride à www.flsd.uscourts.gov ou à http://pacer.flsd.uscourts.gov sous le numéro de dossier 23-60117-CR (S.D. Fla.).
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U.S. Attorney, FBI Raise Awareness on Importance of Reporting Hate CrimesRead the Press Release
FAIRVIEW HEIGHTS, Ill. – As part of a Department of Justice initiative, U.S. Attorney Rachelle Aud Crowe and FBI Springfield Special Agent in Charge David Nanz hosted a safety and hate crime educational training for local religious leaders and security personnel at the FBI Fairview Heights resident office on Wednesday.
“By educating the public through the United Against Hate initiative, the U.S. Attorney’s Office is working to give individuals the resources to report acts motivated by hate when witnessed, so we have the ability to prosecute offenders of federal law,” said U.S. Attorney Rachelle Aud Crowe.
"It is our hope that in informing our faith-based communities about hate crimes, we will empower worshipers to recognize threats and know proper actions to take to protect themselves," said FBI Springfield Special Agent in Charge David Nanz. "Everyone deserves to practice their religious faith and attend religious services without fear of violence. The FBI is committed to protecting houses of worship from bias-motivated crimes."
To offer education to religious officials on protecting their houses of worship, FBI agents and Assistant U.S. Attorneys led training for attendees from Belleville, Cahokia, Shiloh, O’Fallon and surrounding communities on the distinguishing factors between hate crimes versus hate incidents and protected speech under the First Amendment versus speech that advocates violence or encourages people to commit hate crimes. Attendees took away resources on how to report suspected hate crimes to the proper investigative authorities.
FBI also provided active shooter training through its Protect Houses of Worship initiative.
To expand education to students, the U.S. Attorney’s Office is accepting requests to bring the United Against Hate presentation to school districts throughout the Southern District of Illinois. For more information and to request an event, visit www.justice.gov/usao-sdil/united-against-hate.
U.S. Attorney Brandon B. Brown Announces the Appointment of Special Assistant U.S. Attorney in Monroe DivisionRead the Press Release
SHREVEPORT, La. – United States Attorney Brandon B. Brown announced the appointment of Catherine Semmes to serve as a Special Assistant U.S. Attorney (SAUSA) in the Criminal Division of the U.S. Attorney’s Office. This appointment is the result of a partnership between the U.S. Attorney’s Office and the Ouachita Parish District Attorney’s Office in the Monroe Division of the Western District of Louisiana.
Due to the proliferation of gang and gun violence in the Monroe area, U.S. Attorney Brandon B. Brown and Ouachita Parish District Attorney Steve Tew have joined efforts in a unique way to fight violent crime in that area by adding a specially appointed federal prosecutor to work these types of cases. The goal is for Ms. Semmes to partner as a SAUSA with the district’s Project Safe Neighborhood Program and other Assistant U.S. Attorneys to improve the program’s effectiveness in the northeast corner of the district.
“We have collaboratively made some strides in fighting violent crime, but in approaching District Attorney Tew with this idea, I wanted to take our relationship with the Ouachita Parish District Attorney’s Office to the next level,” said U.S. Attorney Brandon B. Brown. “We are grateful that District Attorney Tew is willing to share his talent with our office to find ways to combat the violent crime epidemic our district is facing. SAUSA Semmes will assist where we need it most and we look forward to having her as a part of our office. She has developed a great working relationship with our federal agents and task force officers over the years, is a stalwart with the Metro Narcotics Unit, and is dedicated to helping us eradicate gang violence in Monroe.”
“The partnership between the District Attorney’s Office and the Department of Justice is a powerful tool in the fight against violent crime,” said Ouachita Parish District Attorney Steve Tew. “I am committed to working with the DOJ to successfully prosecute violent offenders who bring guns and drugs into our communities. ADA Cathy Semmes is a zealous prosecutor. She, as well as the other prosecutors in our office, will continue to work with the U.S. Attorney’s office to focus on the worst offenders. I appreciate the opportunity to partner with U.S. Attorney Brandon Brown and his team.”
Catherine Semmes has worked as an Assistant District Attorney for the 4th Judicial District Court in Ouachita Parish since February 2020, where she has served as the office’s liaison with Metro Narcotics and serves in the parish’s Violent Crime Repeat Offender Unit. She also tracks and maintains information concerning known gang members. Prior to practicing law, SAUSA Semmes worked as a Probation and Parole Officer for the Office of Juvenile Justice. She holds a Bachelor of Arts in Criminal Justice from the University of Louisiana at Monroe and a Juris Doctorate from the University of Mississippi School of Law.
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U.S. Attorney Announces Fentanyl Trafficking, Precursor Importation, and Money Laundering Charges Against Chinese Chemical Company and ExecutivesRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, Merrick B. Garland, the Attorney General of the United States, Lisa O. Monaco, the Deputy Attorney General of the United States, and Anne Milgram, the Administrator of the U.S. Drug Enforcement Administration (“DEA”), announced today the unsealing of an Indictment charging the Chinese chemical company HUBEI AMARVEL BIOTECH CO., LTD., a/k/a “AmarvelBio,” (“AMARVEL BIOTECH”) as well as its executives and employees QINGZHOU WANG, a/k/a “Bruce” (“WANG”), YIYI CHEN, a/k/a “Chiron” (“CHEN”), and FNU LNU, a/k/a “Er Yang,” a/k/a “Anita” (“YANG”), with fentanyl trafficking, precursor chemical importation, and money laundering offenses. WANG and CHEN, both nationals of China, were expelled from Fiji on June 8, 2023, arrested by the DEA, and presented before U.S. Magistrate Judge Wes Reber Porter in Honolulu federal court on June 9, 2023. WANG and CHEN were ordered detained in Honolulu and will appear in Manhattan federal court following their arrival in the Southern District of New York. YANG, also a national of China, is at large. The case has been assigned to U.S. District Judge Paul G. Gardephe.
U.S. Attorney Damian Williams said: “The indictment unsealed today in the Southern District of New York is the next step in our fight against fentanyl. Today, we target the very beginning of the fentanyl supply chain: the Chinese manufacturers of the raw chemicals used to make fentanyl and its analogues. We’ve charged a Chinese precursor chemical company. And that’s not all. We’ve charged and arrested some of the individuals who work at the company. That includes a corporate executive and a marketing manager. They’re in American handcuffs. And they’re going to face justice in an American courtroom.”
Attorney General Merrick B. Garland said: “When I announced in April that the Justice Department had taken significant enforcement actions against the Sinaloa Cartel, I promised that the Justice Department would never forget the victims of the fentanyl epidemic. I also promised that we would never stop working to hold accountable those who bear responsibility for it. That includes not only going after the leaders of the Cartels, their drug and gun traffickers, their money launderers, security forces, and clandestine lab operators. It also includes stopping the Chinese chemical companies that are supplying the cartels with the building blocks they need to manufacture deadly fentanyl.”
Deputy Attorney General Lisa O. Monaco said: “Today’s announcement is a down payment on our pledge to use every tool in the government’s arsenal, in every corner of the globe, to protect American communities. The Justice Department will not rest or relent in investigating and prosecuting every link of the fentanyl supply chain, including the PRC companies and executives who produce and export vast quantities of the precursor chemicals the drug cartels need to peddle their poison. There can be no safe haven.”
DEA Administrator Anne Milgram said: “Today’s announcement is a considerable step forward in our unrelenting fight against fentanyl, targeting the threat where it starts. These companies and individuals are alleged to have knowingly supplied drug traffickers, in the United States and Mexico, with the ingredients and scientific know-how needed to make fentanyl – a drug that continues to devastate families and communities across the United States, killing Americans from all walks of life. The fentanyl supply chain begins in China, but tragically, it ends here. Targeting entire criminal drug networks, from the source of supply to the last mile of distribution, is critical to saving American lives. DEA will not stop until this crisis ends.”
According to the allegations contained in the Indictment and other court filings:[1]
AMARVEL BIOTECH is a chemical manufacturer based in the city of Wuhan in Hubei Province, China, that has exported vast quantities of the precursor chemicals used to manufacture fentanyl and its analogues. A synthetic opioid that is 50 times more potent than heroin, fentanyl is now the leading cause of death for Americans ages 18 to 49. Fentanyl analogues, similar in chemical makeup and effect to fentanyl, can be even more potent and lethal than fentanyl. Fentanyl and its analogues have devastated communities across the United States and are fueling the ongoing opioid epidemic, which killed at least 105,263 Americans between February 2022 and January 2023 alone.
AMARVEL BIOTECH has openly advertised online its shipment of fentanyl precursor chemicals to the United States and to Mexico, where drug cartels operate clandestine laboratories, synthesize finished fentanyl at scale, and distribute the deadly fentanyl into and throughout the United States. Through its website and a host of other storefront sites, AMARVEL BIOTECH has targeted precursor chemical customers in Mexico, including by advertising fentanyl precursors as a “Mexico hot sale”; guaranteeing “100% stealth shipping” abroad; and posting to its websites documentation of AMARVEL BIOTECH shipping chemicals to Culiacan, the home city of the Sinaloa Cartel, one of the dominant drug trafficking organizations in the Western Hemisphere and which is largely responsible for the massive influx of fentanyl into the United States in recent years.
AMARVEL BIOTECH has also endeavored to thwart law enforcement interdiction of its precursor chemical shipments. AMARVEL BIOTECH has advertised, for example, the company’s ability to use deceptive packaging — such as packaging indicating the contents are dog food, nuts, or motor oil — to ensure “safe” delivery to the United States and Mexico.
Over the past eight months, during the course of an undercover investigation by the DEA, AMARVEL BIOTECH and its principal executive, WANG, its marketing manager, CHEN, and its sales representative, YANG, shipped more than 200 kilograms from China to the United States of precursor chemicals used to make fentanyl and its analogues. AMARVEL BIOTECH, WANG, CHEN, and YANG shipped the precursors to the United States intending that the chemicals would be used to produce fentanyl and its analogues in New York, and they agreed to continue supplying multi-ton shipments of fentanyl precursors despite being told that Americans had died after consuming fentanyl made from the chemicals that the defendants had sold.
For example, on or about November 17, 2022, a DEA confidential source (“CS-1”) wrote to YANG using an encrypted messaging application, “You know I making fentanyl,” and “Is not safe.” YANG replied, “i know.” On or about December 1, 2022, YANG wrote to CS-1, promising that CS-1 would be “happy with our product” and noting that CS-1 would “be able to synthesize fentanyl.” In exchange for payment in cryptocurrency, AMARVEL BIOTECH thereafter shipped from China to New York approximately 999.7 grams of the fentanyl precursor 1-boc-4-AP, approximately 1,002.6 grams of the fentanyl precursor 1-boc-4-piperidone, and approximately 893.6 grams of the methamphetamine precursor methylamine.
In or about March 2023, WANG and CHEN met in person with an individual whom CS-1 represented was CS-1’s boss but was in fact another DEA confidential source (“CS-2”). During the meeting, WANG and CHEN discussed AMARVEL BIOTECH’s ability to supply ton-quantities of fentanyl precursors to New York for CS-1 and CS-2’s fentanyl manufacturing operation. After CS-2 stated that CS-2 wanted a different formula for manufacturing fentanyl and that several of CS-2’s American customers had purportedly died, WANG and CHEN advised they had “a lot of customers in America and Mexico” who could provide technical assistance with fentanyl production.
After the March 2023 meeting, AMARVEL BIOTECH, WANG, CHEN, and YANG agreed to sell CS-1 and CS-2 approximately 210 kilograms of fentanyl precursors in exchange for payment in cryptocurrency. During an April 10, 2023, video call with WANG and CHEN, CS-2 stated that the approximately 210 kilograms of fentanyl precursors would be used to manufacture approximately 50 to 55 kilograms of fentanyl — an amount that could contain approximately 25 million deadly doses.
In or about May 2023, AMARVEL BIOTECH, WANG, CHEN, and YANG sent to the United States the shipment ordered by CS-1 and CS-2. On or about May 5, 2023, the DEA retrieved the precursor shipment from a warehouse near Los Angeles, California. Lab testing confirmed the presence of a precursor chemical for a fentanyl analogue. In an encrypted messaging group chat with CS-1, CS-2, WANG, and CHEN, YANG explained that “New York, the United States, has been strict in checking the precursors of the ‘final product’ some time ago, so for the sake of safety, this time it is sent to California.”
In or about June 2023, WANG and CHEN met again with CS-2. During the meeting, WANG and CHEN discussed with CS-2 a multi-ton order of fentanyl precursor chemicals. WANG and CHEN also discussed the need to take additional measures to protect themselves from detection and interdiction of their shipments “because recently American government . . . seized some Mexican group and they followed the routes to China,” where the U.S. Government found “our competitor in China” — an apparent reference to fentanyl-related charges filed in the Southern District of New York and announced in April 2023 against, among others, leadership of the Sinaloa Cartel and certain China-based precursor chemical company executives.[2]
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A table containing the charges and minimum and maximum potential penalties for AMARVEL BIOTECH, a company in China; WANG, 35, of China; CHEN, 31, of China; and YANG, of China, is set forth below. The minimum and maximum potential penalties are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by a judge.
Count
Defendants
Minimum and Maximum Penalties
Count One: Fentanyl Trafficking Conspiracy
AMARVEL BIOTECH, WANG, CHEN, and YANG
Mandatory minimum sentence of 10 years in prison; maximum sentence of life in prison
Fine of the greatest of $50 million for organizations or $10 million for individuals, twice the gross pecuniary gain from the offense, or twice the gross pecuniary loss to others from the offense
Count Two: Conspiracy to Import Fentanyl Precursor Chemical with Intent to Manufacture Fentanyl
AMARVEL BIOTECH, WANG, CHEN, and YANG
Maximum sentence of 20 years in prison
Fine of the greatest of $500,000 for organizations or $250,000 for individuals, twice the gross pecuniary gain from the offense, or twice the gross pecuniary loss to others from the offense
Count Three: Importation of Fentanyl Precursor Chemical with Intent to Manufacture Fentanyl
AMARVEL BIOTECH, WANG, and YANG
Maximum sentence of 20 years in prison
Fine of the greatest of $500,000 for organizations or $250,000 for individuals, twice the gross pecuniary gain from the offense, or twice the gross pecuniary loss to others from the offense
Count Four: Importation of Methamphetamine Precursor Chemical
AMARVEL BIOTECH, WANG, and YANG
Maximum sentence of 10 years in prison
Fine of the greatest of $500,000 for organizations or $250,000 for individuals, twice the gross pecuniary gain from the offense, or twice the gross pecuniary loss to others from the offense
Count Five: Conspiracy to Commit Money Laundering
AMARVEL BIOTECH, WANG, CHEN, and YANG
Maximum sentence of 20 years in prison
Fine of the greatest of $500,000 or twice the value of the monetary instrument or funds involved in the laundering
Mr. Williams praised the outstanding efforts of the DEA’s Special Operations Division Bilateral Investigations Unit. Mr. Williams also thanked the DEA Bangkok Country Office, DEA Wellington Country Office, DEA Beijing Country Office, DEA Honolulu District Office, DEA New York Organized Crime Drug Enforcement Task Force (“OCDETF”) Strike Force, DEA Riverside District Office, DEA Special Testing Laboratory, the Office of International Affairs of the Department of Justice’s Criminal Division, the Royal Thai Police Narcotics Suppression Bureau, the Fiji Police Force Narcotic Bureau, the Fiji Office of the Director of Public Prosecutions, and the U.S. Attorney’s Office for the District of Hawaii for their assistance.
This case is being handled by the Office’s National Security and International Narcotics Unit. Assistant U.S. Attorneys Kevin Sullivan and Alexander Li are in charge of the prosecution.
The charges in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Indictment and the description of the Indictment and other court filings set forth herein constitute only allegations, and every fact described should be treated as an allegation.
[2] United States v. Ivan Archivaldo Guzman Salazar, et al., No. 23 Cr. 180 (S.D.N.Y. Apr. 4, 2023).
U.S. v. Amarvel Biotech et al IndictmentU.K. Citizen Sentenced to Five Years in Prison for Cybercrime OffensesRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, announced that JOSEPH JAMES O’CONNOR, a/k/a “PlugwalkJoe,” a U.K. citizen, was sentenced today to five years in prison for his role in a wide array of cybercrime offenses. O’CONNOR was extradited from Spain on April 26, 2023, and pled guilty on May 9, 2023, before U.S. District Judge Jed S. Rakoff to two sets of charges: (i) conspiracy to commit computer hacking and other charges pending in the Southern District of New York relating to a fraudulent scheme perpetrated by O’CONNOR and his co-conspirators to use a cyber intrusion technique known as a SIM swap attack to steal cryptocurrency, then valued at approximately $794,000, from a Manhattan-based cryptocurrency company and then to launder the proceeds of the scheme (the “SDNY Case”), and (ii) a set of charges filed in the Northern District of California, and transferred to the SDNY under Federal Rule of Criminal Procedure 20, relating to O’Connor’s role in the July 2020 hack of Twitter, computer intrusions related to takeovers of TikTok and Snapchat user accounts, and cyberstalking two separate victims (the “NDCA Case”). Judge Rakoff imposed today’s sentence.
According to the publicly filed charging documents against O’CONNOR, court filings, and statements made in court:
The SDNY Case
During a cyber intrusion known as a subscriber identity module (“SIM”) swap attack, cyber threat actors gain control of a victim’s mobile phone number by linking that number to a SIM card controlled by the threat actors, resulting in the victim’s calls and messages being routed to a malicious unauthorized device controlled by the threat actors. The threat actors then typically use control of the victim’s mobile phone number to obtain unauthorized access to accounts held by the victim that are registered to the mobile phone number.
Between approximately March 2019 and May 2019, O’CONNOR and his co-conspirators perpetrated a scheme to use SIM swaps to conduct cyber intrusions in order to steal a large amount of cryptocurrency from a Manhattan-based cryptocurrency company (“Company-1”), which, at all relevant times, provided wallet infrastructure and related software to cryptocurrency exchanges around the world.
As part of the scheme, O’CONNOR and his co-conspirators successfully perpetrated SIM swap attacks targeting at least three Company-1 executives. Following a successful SIM swap attack targeting one of the executives on or about April 30, 2019, O’CONNOR and his co-conspirators successfully gained unauthorized access to multiple Company-1 accounts and computer systems. On or about May 1, 2019, through their unauthorized access, O’CONNOR and his co-conspirators stole and fraudulently diverted cryptocurrency of various types (the “Stolen Cryptocurrency”) from cryptocurrency wallets maintained by Company-1 on behalf of two of its clients. The Stolen Cryptocurrency was worth at least approximately $794,000 at the time of the theft and is currently worth more than $1.6 million.
After stealing and fraudulently diverting the Stolen Cryptocurrency, O’CONNOR and his co-conspirators laundered it through dozens of transfers and transactions and exchanged some of it for Bitcoin using cryptocurrency exchange services. Ultimately, a portion of the Stolen Cryptocurrency was deposited into a cryptocurrency exchange account controlled by O’CONNOR.
The NDCA Case
Between 2019 and 2020, O’CONNOR participated in a variety of crimes associated with exploitation of social media accounts, online extortion, and cyberstalking.
In July 2020, O’CONNOR participated in a conspiracy to gain unauthorized access to social media accounts maintained by Twitter, Inc. (“Twitter”). In early July 2020, O’CONNOR’s co-conspirators used social engineering techniques to obtain unauthorized access to administrative tools used by Twitter to maintain its operations. Those co-conspirators were able to use the tools to transfer control of certain Twitter accounts from their rightful owners to various unauthorized users. In some instances, the co-conspirators took control themselves and used that control to launch a scheme to defraud other Twitter users. In other instances, the co-conspirators sold access to Twitter accounts to others. O’CONNOR communicated with others regarding purchasing unauthorized access to a variety of Twitter accounts, including accounts associated with public figures around the world. A number of Twitter accounts targeted by O’CONNOR were subsequently transferred away from their rightful owners. O’CONNOR agreed to purchase unauthorized access to one Twitter account for $10,000.
O’CONNOR also accessed without authorization one of the most highly visible TikTok accounts in August 2020, which was associated with a public figure with millions of followers (“Victim-1”). O’CONNOR and his associates obtained unauthorized access to Victim-1’s account via a SIM swap after discussing a variety of celebrities to target, and O’CONNOR used his unauthorized access to Victim-1’s platform to post self-promotional messages, including a video in which O’CONNOR’s voice is recognizable. O’CONNOR also stated publicly, via a post to Victim-1’s TikTok account, that he would release sensitive, personal material related to Victim-1 to individuals who joined a specified Discord server.
O’CONNOR targeted another public figure (“Victim-2”) in June 2019. O’CONNOR and his associates obtained unauthorized access to Victim-2’s account on Snapchat via a SIM swap. They used that access to obtain sensitive materials, to include private images, that Victim-2 had not made publicly available. O’CONNOR sent copies of these sensitive materials to his associates. O’CONNOR and his associates also reached out to Victim-2 and threatened to publicly release the stolen sensitive materials unless Victim-2 agreed to publicly post messages related to O’CONNOR’s online persona, among other things.
Lastly, O’CONNOR stalked and threatened a minor victim (“Victim-3”) in June and July 2020. In June 2020, O’CONNOR orchestrated a series of swatting attacks on Victim-3. A “swatting” attack occurs when an individual makes a false emergency call to a public authority in order to cause a law enforcement response that may put the victim or others in danger. On June 25, 2020, O’CONNOR called a local police department and falsely claimed that Victim-3 was making threats to shoot people. O’CONNOR provided an address that he believed was Victim-3’s address, which would have the result of causing a law enforcement response. That same day, O’CONNOR placed another call to the same police department and stated that he was planning to kill multiple people at the same address. In response to that call, the police department dispatched every on-duty officer to that address in reference to an armed and dangerous individual. O’CONNOR sent other swatting messages that same day to a high school, a restaurant, and a sheriff’s department in the same area. In those messages, O’CONNOR represented himself as either Victim-3 or as a resident at the address he believed was Victim-3’s. The following month, O’CONNOR called multiple family members of Victim-3 and threatened to kill them.
The NDCA Case was transferred to the Southern District of New York pursuant to Federal Rule of Criminal Procedure 20 and consolidated with the SDNY Case before Judge Rakoff.
* * *
O’CONNOR, 24, of the United Kingdom, pled guilty before Judge Rakoff to the following charges: (i) as part of the SDNY Case — conspiracy to commit computer intrusions, conspiracy to commit wire fraud, and conspiracy to commit money laundering; and (ii) as part of the NDCA Case — conspiracy to commit computer intrusion, two counts of committing computer intrusions, making extortive communications, two counts of stalking, and making threatening communications. In addition to the prison term, O’CONNOR was sentenced to THREE years of supervised release. O’CONNOR was further ordered to pay $794,012.64 in forfeiture.
Mr. Williams praised the outstanding work of the Federal Bureau of Investigation. He also thanked the Department of Justice’s Office of International Affairs for its assistance in the extradition.
The SDNY Case is being handled by the Complex Frauds and Cybercrime Unit of the United States Attorney’s Office for the Southern District of New York. Assistant U.S. Attorney Olga I. Zverovich is in charge of the prosecution of the SDNY Case. The NDCA Case is being handled by the U.S. Attorney’s Office for the Northern District of California and the Computer Crime and Intellectual Property Section (“CCIPS”) of the Department of Justice. Assistant U.S. Attorney Andrew F. Dawson and CCIPS Assistant Deputy Chief Adrienne L. Rose are in charge of the prosecution of the NDCA Case.
U.K. Citizen Sentenced to Five Years for Cybercrime OffensesRead the Press Release
SAN FRANCISCO – Joseph James O’Connor, a/k/a “PlugwalkJoe,” a U.K. citizen, was sentenced today to five years in federal prison for his role in a wide array of cybercrime offenses. O’Connor was extradited from Spain on April 26, 2023, and pleaded guilty on May 9, 2023, before Southern District of New York U.S. District Judge Jed S. Rakoff to two sets of charges: (i) a set of charges filed in the Northern District of California, and transferred to the Southern District of New York under Federal Rule of Criminal Procedure 20, relating to O’Connor’s role in the July 2020 hack of Twitter, Inc. (Twitter), computer intrusions related to takeovers of TikTok and Snapchat user accounts, and cyberstalking two separate victims (the “NDCA Case”), and (ii) conspiracy to commit computer hacking and other charges pending in the Southern District of New York relating to a fraudulent scheme perpetrated by O’Connor and his co-conspirators to use a cyber intrusion technique known as a SIM swap attack to steal cryptocurrency, then valued at approximately $794,000, from a Manhattan-based cryptocurrency company and then to launder the proceeds of the scheme (the “SDNY Case”). U.S. District Judge Rakoff handed down today’s sentence.
“The investigation, charging, extradition, and prosecution of this case required the cooperation and coordinated efforts of many people,” said United States Attorney Ismail Ramsey. “This case demonstrates why cybercriminals can take no comfort in any anonymity they may think they enjoy. They will be identified, diligently pursued, and brought to justice.”
The NDCA Case
According to the publicly filed charging documents, court filings, and statements made in court, between 2019 and 2020, O’Connor participated in a variety of crimes associated with exploitation of social media accounts, online extortion, and cyberstalking.
In July 2020, O’Connor participated in a conspiracy to gain unauthorized access to social media accounts maintained by Twitter. In early July 2020, O’Connor co-conspirators used social engineering techniques to obtain unauthorized access to administrative tools used by Twitter to maintain its operations. Those co-conspirators were able to use the tools to transfer control of certain Twitter accounts from their rightful owners to various unauthorized users. In some instances, the co-conspirators took control themselves and used that control to launch a scheme to defraud other Twitter users. In other instances, the co-conspirators sold access to Twitter accounts to others. O’Connor communicated with others regarding purchasing unauthorized access to a variety of Twitter accounts, including accounts associated with public figures around the world. A number of Twitter accounts targeted by O’Connor were subsequently transferred away from their rightful owners. O’Connor agreed to purchase unauthorized access to one Twitter account for $10,000.
O’Connor also accessed without authorization one of the most highly visible TikTok accounts in August 2020, which was associated with a public figure with millions of followers (“Victim-1”). O’Connor and his associates obtained unauthorized access to Victim-1’s account via a SIM swap after discussing a variety of celebrities to target, and O’Connor used his unauthorized access to Victim-1’s platform to post self-promotional messages, including a video in which O’CONNOR’s voice is recognizable. O’Connor also stated publicly, via a post to Victim-1’s TikTok account, that he would release sensitive, personal material related to Victim-1 to individuals who joined a specified Discord server.
O’Connor targeted another public figure (“Victim-2”) in June 2019. O’Connor and his associates obtained unauthorized access to Victim-2’s account on Snapchat via a SIM swap. They used that access to obtain sensitive materials, to include private images, that Victim-2 had not made publicly available. O’Connor sent copies of these sensitive materials to his associates. O’Connor and his associates also reached out to Victim-2 and threatened to publicly release the stolen sensitive materials unless Victim-2 agreed to publicly post messages related to O’Connor online persona, among other things.
Lastly, O’Connor stalked and threatened a minor victim (“Victim-3”) in June and July 2020. In June 2020, O’Connor orchestrated a series of swatting attacks on Victim-3. A “swatting” attack occurs when an individual makes a false emergency call to a public authority in order to cause a law enforcement response that may put the victim or others in danger. On June 25, 2020, O’Connor called a local police department and falsely claimed that Victim-3 was making threats to shoot people. O’Connor provided an address that he believed was Victim-3’s address, which would have the result of causing a law enforcement response. That same day, O’Connor placed another call to the same police department and stated that he was planning to kill multiple people at the same address. In response to that call, the police department dispatched every on-duty officer to that address in reference to an armed and dangerous individual. O’Connor sent other swatting messages that same day to a high school, a restaurant, and a sheriff’s department in the same area. In those messages, O’Connor represented himself as either Victim-3 or as a resident at the address he believed was Victim-3’s. The following month, O’Connor called multiple family members of Victim-3 and threatened to kill them.
The NDCA Case was transferred to the Southern District of New York pursuant to Federal Rule of Criminal Procedure 20 and consolidated with the SDNY Case before U.S. District Judge Rakoff.
The SDNY Case
During a cyber intrusion known as a subscriber identity module (“SIM”) swap attack, cyber threat actors gain control of a victim’s mobile phone number by linking that number to a SIM card controlled by the threat actors, resulting in the victim’s calls and messages being routed to a malicious unauthorized device controlled by the threat actors. The threat actors then typically use control of the victim’s mobile phone number to obtain unauthorized access to accounts held by the victim that are registered to the mobile phone number.
Between approximately March 2019 and May 2019, O’Connor and his co-conspirators perpetrated a scheme to use SIM swaps to conduct cyber intrusions in order to steal a large amount of cryptocurrency from a Manhattan-based cryptocurrency company (“Company-1”), which, at all relevant times, provided wallet infrastructure and related software to cryptocurrency exchanges around the world.
As part of the scheme, O’Connor and his co-conspirators successfully perpetrated SIM swap attacks targeting at least three Company-1 executives. Following a successful SIM swap attack targeting one of the executives on or about April 30, 2019, O’Connor and his co-conspirators successfully gained unauthorized access to multiple Company-1 accounts and computer systems. On or about May 1, 2019, through their unauthorized access, O’Connor and his co-conspirators stole and fraudulently diverted cryptocurrency of various types (the “Stolen Cryptocurrency”) from cryptocurrency wallets maintained by Company-1 on behalf of two of its clients. The Stolen Cryptocurrency was worth at least approximately $794,000 at the time of the theft and is currently worth more than $1.6 million.
After stealing and fraudulently diverting the Stolen Cryptocurrency, O’Connor and his co-conspirators laundered it through dozens of transfers and transactions and exchanged some of it for Bitcoin using cryptocurrency exchange services. Ultimately, a portion of the Stolen Cryptocurrency was deposited into a cryptocurrency exchange account controlled by O’Connor.
* * *
O’Connor, 24, of the United Kingdom, pleaded guilty before U.S. District Judge Rakoff to the following charges: (i) as part of the NDCA Case – a conspiracy to commit computer intrusion, two counts of committing computer intrusions, making extortive communications, two counts of stalking, and making threatening communications; and (ii) as part of the SDNY Case – a conspiracy to commit computer intrusions, conspiracy to commit wire fraud, and conspiracy to commit money laundering. In addition to the prison term, O’Connor was sentenced to three years of supervised release. O’Connor was further ordered to pay $794,012.64 in forfeiture.
The FBI is investigating the case with assistance from the US Secret Service, San Francisco Field Office; US Secret Service, Criminal Investigations Division; IRS Criminal Investigations, Cyber Crimes Unit; Spanish National Police; and United Kingdom National Crime Agency.
The U.S. Attorney’s Office for the Northern District of California and the Criminal Division’s Computer Crime and Intellectual Property Section (CCIPS) are handling the NDCA case. Assistant U.S. Attorney Andrew F. Dawson for the Northern District of California and CCIPS Assistant Deputy Chief Adrienne L. Rose are prosecuting the case.
The U.S. Attorney’s Office for the Southern District of New York’s Complex Frauds and Cybercrime Unit is handling the SDNY case. Assistant U.S. Attorney Olga I. Zverovich for the Southern District of New York is prosecuting the case.
The Justice Department’s Office of International Affairs provided valuable assistance in securing the extradition of O’Connor.
Two Men Sentenced to Prison Terms in $1 Million ‘Upfront-Fee’ SchemeRead the Press Release
NEWARK, N.J. – A Camden County, New Jersey, man and a Nevada man were sentenced to prison terms for their roles in defrauding multiple victims through a $1 million “upfront-fee” scheme, U.S. Attorney Philip R. Sellinger announced today.
Roy Johannes Gillar, 51, of Las Vegas, was sentenced to six years in prison; Harold Mignott, 60, of Voorhees, New Jersey, was sentenced to three years in prison. They were each convicted on Oct. 21, 2022, of wire fraud conspiracy and four counts of wire fraud following a five-week jury trial before U.S. District Judge John Michael Vazquez. Gillar was also convicted of one count of transacting in criminal proceeds. Judge Vazquez imposed the sentences on June 22, 2023, in Newark federal court. A co-defendant, Jerrid Douglas of Freehold, New Jersey, who was also convicted, is scheduled to be sentenced on July 26, 2023.
According to documents in this case and evidence at trial:
From March 2016 through June 2016, Douglas, Gillar, and Mignott, along with a fourth conspirator, agreed to defraud the owners of the victim company of approximately $1 million. The defendants fraudulently induced the two victim company owners to enter a joint venture agreement with the defendants’ New Jersey-based shell company. The defendants falsely represented that their company could acquire and provide a “standby letter of credit” (SBLC) backed by either €1 billion in cash or highly lucrative Mexican gold bonds. An SBLC is a guarantee of payment issued by a bank on behalf of a client that is used should the client fail to fulfill a contractual commitment with a third party.
The victim company wanted access to the standby letter of credit so it could purchase raw gold overseas and sell it to gold refineries. As part of the joint venture agreement, the company agreed to pay the defendants $1 million for the bank fee associated with the standby letter of credit.
In order to cover up the scheme and convince the victims to approve the transfer of the funds, the defendants made numerous verbal and written misrepresentations, including providing the victims with a phony letter from a major international bank saying that it was ready, willing, and able to provide a €1 billion SBLC to the defendants’ shell company.
However, after the victim company owners transmitted $800,000 of the $1 million to the defendants, the defendants failed to provide an SBLC or anything of value. Instead, the defendants misappropriated the money for their personal use.
In addition to the prison terms, Judge Vazquez sentenced Gillar to three years of supervised release and ordered to pay restitution of $1.1 million and forfeiture of $1 million. Mignott was sentenced to three years of supervised release and ordered to pay restitution of $1.1 million and forfeiture of $219,000.
U.S. Attorney Sellinger credited special agents of the FBI, under the direction of Special Agent in Charge James E. Dennehy in Newark, with the investigation leading to the sentencing.
The government is represented by Assistant U.S. Attorneys Jason S. Gould and Joshua L. Haber of the U.S. Attorney’s Office Criminal Division in Newark.
Two Men Plead Guilty to Federal Drug CrimesRead the Press Release
BECKLEY, W.Va. – Lorenzo B. Herbert, 33, of Beckley, pleaded guilty to possession with intent to distribute 40 grams or more of fentanyl and 50 grams or more of a mixture containing methamphetamine and Rory Divaughn Spells, 35, of Chicago, Illinois, pleaded guilty to possession with intent to distribute a quantity of fentanyl and a quantity of methamphetamine.
According to court documents and statements made in court, on September 28, 2022, law enforcement officers executed a search warrant at a residence near Beckley. Officers found quantities of fentanyl, a substance containing methamphetamine and $8,245. Herbert and Spells each admitted that they were mixing and preparing fentanyl for distribution in the residence’s kitchen at the time the search warrant was executed. Herbert and Spells further admitted the cash represented proceeds of previous drug trafficking activity.
Herbert is scheduled to be sentenced on October 19, 2023, and faces a mandatory minimum of five years and up to 40 years in prison, at least four years of supervised release, and a $5 million fine. Spells is scheduled to be sentenced on October 27, 2023, and faces a maximum penalty of 20 years in prison, at least three years of supervised release, and a $1 million fine.
The guilty pleas are the result of a drug trafficking investigation dubbed Southside Take Down. United States Attorney Will Thompson made the announcement and commended the investigative work of the Federal Bureau of Investigation (FBI), the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), the Beckley/Raleigh County Drug and Violent Crime Unit, the U.S. Department of Homeland Security-Homeland Security Investigations (HSI), the Metropolitan Drug Enforcement Network Team (MDENT), FBI Chicago, and the Chicago Police Department.
United States District Judge Frank W. Volk presided over the hearings. Assistant United States Attorney Timothy D. Boggess is prosecuting the cases.
The investigation was part of the Department of Justice’s Organized Crime Drug Enforcement Task Force (OCDETF). The program was established in 1982 to conduct comprehensive, multilevel attacks on major drug trafficking and money laundering organizations and is the keystone of the Department of Justice’s drug reduction strategy. OCDETF combines the resources and expertise of its member federal agencies in cooperation with state and local law enforcement. The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking organizations, transnational criminal organizations and money laundering organizations that present a significant threat to the public safety, economic, or national security of the United States.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Southern District of West Virginia. Related court documents and information can be found on PACER by searching for Case No. 5:22-cr-193 and 5:23-cr-72.
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Twenty-Four Defendants Indicted in Pittsburgh Drug Trafficking RingRead the Press Release
PITTSBURGH, Pa. – A federal grand jury in Pittsburgh has returned an Indictment following a five-month Title III wiretap investigation targeting a drug trafficking organization operating in the Pittsburgh area. The Indictment charges a total of 24 individuals residing in Pittsburgh with violations of federal drug and firearm laws, United States Attorney Eric G. Olshan announced today.
The nine-count Indictment names the following 24 individuals as the defendants:
- LAMONT BELL, 54, of Pittsburgh, Pennsylvania.
- DELANO BROWN, 36, of Pittsburgh, Pennsylvania.
- ANDRE CAIN, 46, of Pittsburgh, Pennsylvania.
- MARVIN COATES, 49, of Pittsburgh, Pennsylvania.
- ANTHONY COKER, 46, of Pittsburgh, Pennsylvania.
- MARK COOK, 55, of Clairton, Pennsylvania.
- ROBERT FIELDS, 29, of Pittsburgh, Pennsylvania.
- MARVIN GRIMMIT, 68, of Pittsburgh, Pennsylvania.
- TYRON HARRISON, 30, formerly of Pittsburgh, Pennsylvania.
- BRIAN HORTON, 22, formerly of Pittsburgh, Pennsylvania.
- ERIC HOWARD, 35, of McKees Rocks, Pennsylvania.
- WILLIAM JONES, 28, formerly of Pittsburgh, Pennsylvania.
- MICAH LATIMER, 22, of Pittsburgh, Pennsylvania.
- ANTHONY LEE, 43, of Pittsburgh, Pennsylvania.
- WILLIAM LEWIS, 45, of Pittsburgh, Pennsylvania.
- SHAWN NORWOOD, 32, of South Park, Pennsylvania.
- EDWIN PEOPLES, 44, of Pittsburgh, Pennsylvania.
- ERIC PEOPLES, 46, of Pittsburgh, Pennsylvania.
- DAMON PETERS, 19, of Pittsburgh, Pennsylvania.
- KEVIN RUCKER, 52, of Pittsburgh, Pennsylvania.
- MAURICE SMITH, 28, of Pittsburgh, Pennsylvania.
- JAMONE WATSON, 28, of Pittsburgh, Pennsylvania.
- ROY WOOD, 47, of Pittsburgh, Pennsylvania.
- SEAN WOODY, 32, of Pittsburgh, Pennsylvania.According to the Indictment, from July 2022 until June 2023, Rucker was a large-scale distributor of cocaine in the Pittsburgh area, and supplied several individuals, including Coker, with substantial quantities of cocaine. Coker, in turn, supplied several other Pittsburgh-area drug traffickers, many of whom were members and associates of the “Drizzy Gang” street gang. Members and associates of this gang trafficked firearms and narcotics in Pittsburgh’s Hill District, operating an open-air drug market on Watson Street.
Specifically, from July 2022 through June 2023, Rucker, Cain, Lewis, Bell, Coker, Woody, Latimer, Brown, Lee, Watson, Cook, Eric Peoples, Edwin Peoples, Fields, Coates, Wood, Norwood, and Grimmitt allegedly conspired to distribute and possess with intent to distribute cocaine and/or crack cocaine, Schedule II controlled substances. Additionally, between March 2023 and May 23, 2023, Jones, Watson, Peters, and Brown allegedly conspired to possess with intent to distribute fentanyl, a Schedule II controlled substance. In a third alleged conspiracy, between February 2023 and June 2023, Howard and Brown conspired to possess with intent to distribute fentanyl, a Schedule II controlled substance. Lastly, Latimer, Smith, Lee, Jones, Harrison, and Horton allegedly possessed firearms and ammunition despite being prohibited as a result of prior felony convictions.
On June 22, 2023, a 25th defendant was charged by criminal complaint. According to the charging documents, John Johnson, age 46, has been charged with drug trafficking and firearms offenses following execution of a search warrant at his residence and the resulting recovery of suspected cocaine and a loaded firearm.
“This office is committed to protecting the residents of Western Pennsylvania from those whose violent and destructive actions jeopardize the safety and well-being of our communities,” said U.S. Attorney Olshan. “Together with our trusted law enforcement partners at the FBI, DEA, and Pittsburgh Bureau of Police, we will continue our effort to hold accountable the most dangerous offenders through effective enforcement of federal drug and firearm laws.”
“Violent groups don’t belong in our community,” said FBI Pittsburgh Special Agent in Charge Mike Nordwall. “We will continue to do everything we can to ensure the public can live free of fear, violence, and intimidation. These arrests are the direct result of the hard work and dedication of the FBI’s Greater Pittsburgh Safe Streets Task Force and our partners in their efforts to combat gang members who distribute dangerous drugs like heroin, cocaine, and fentanyl in our communities.”
“Today’s announcement deals a significant blow to a drug trafficking organization that has dealt misery and pain throughout the communities of Western Pennsylvania. The DEA and our law enforcement partners are committed to safeguarding the health and safety of our communities and to keeping Americans safe from the menace of drugs and the violence associated with their distribution,” said Assistant Special Agent in Charge Keith Hart, who is the head of DEA operations across Western Pennsylvania. “I commend the extreme hard work of the members of the DEA and our partners in making our communities safer.”
“With this indictment, several communities are breathing a little more easily today, reassured that the Pittsburgh Bureau of Police and our federal law enforcement partners are consistently committed to disassembling criminal networks and inhibiting drug and gun pipelines which hurt children and families,” said Pittsburgh Police Chief Larry Scirotto. “We will continue to work closely with our local and federal partners and community members to prevent violent crime, because everyone deserves to live in secure and thriving neighborhoods.”
For Rucker, Cain, and Coker, the law provides for a maximum total sentence of not less than 10 years in prison and up to life, a fine of no greater than $10,000,000.00, a term of supervised release of at least five years, or a combination thereof. For Lewis and Woody, the law provides for a maximum total sentence of not less than 5 years in prison and up to 40 years in prison, a fine of no greater than $5,000,000, a term of supervised release of at least four years, or a combination thereof. For Bell, Latimer, Brown, Lee, Watson, Cook, Eric Peoples, Edwin Peoples, Fields, Coates, Wood, Norwood, Grimmitt, Jones, Peters, and Howard the law provides for a maximum total sentence of up to 20 years in prison, a fine of no greater than $1,000,000, a term of supervised release of at least three years, or a combination thereof. As to the firearms charges for Latimer, Smith, Lee, Jones, Harrison, and Horton, the law provides for a maximum sentence of 15 years, a fine of no greater than $250,000, and a term of supervised release of three years. For Johnson, the firearm charge carries a maximum total sentence of not less than 5 years in prison up to life, a term of supervised release of not less than three years, a fine of up to $1,500,000, or a combination thereof. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendants.
Assistant United States Attorneys Katherine C. Jordan and Douglas C. Maloney are prosecuting this case on behalf of the government.
The Drug Enforcement Administration, Federal Bureau of Investigation, and Pittsburgh Bureau of Police conducted the investigation leading to the Indictment in this case. FBI Pittsburgh’s Safe Streets Task Force comprises investigators from the FBI, Pittsburgh Bureau of Police, Allegheny County Sheriff’s office, PA Attorney General’s Office, Penn Hills Police Department, and Allegheny County Probation and Parole.
This prosecution is a result of two Organized Crime Drug Enforcement Task Force (OCDETF) investigations. OCDETF identifies, disrupts, and dismantles high-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten communities throughout the United States. OCDETF uses a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Troutville Man Pleads Guilty to Drug Trafficking ChargesRead the Press Release
PITTSBURGH, PA – A former resident of Troutville, Pennsylvania pleaded guilty in federal court to violation of federal narcotics and money laundering laws related to a nine-month Title III wiretap investigation into drug trafficking in and around the counties of Jefferson, Clearfield, and Allegheny, United States Attorney Eric G. Olshan announced today.Derek Hillebrand, age 27, pleaded guilty to one count of conspiracy to distribute and possesses with intent to distribute 50 grams or more of methamphetamine, 500 grams or more of a mixture and substance containing a detectable amount of methamphetamine, 500 grams or more of a mixture and substance containing a detectable amount of cocaine, and a quantity of marijuana as well as one count of conspiracy to launder money before United States District Judge Christy Criswell Wiegand. Charlan was one of 47 defendants charged in six related indictments as part of the Return to Sender investigation.
In connection with the guilty plea, the court was advised that Hillebrand received at least 220 pounds of methamphetamine and over 100 kilograms of marijuana that was shipped from California and Nevada. Hillebrand shipped a large amount of United States currency to the Stockton, California area to pay for the narcotics.
Judge Wiegand scheduled sentencing for Hillebrand on October 19, 2023, at 10:00 a.m. The law provides for a sentence of not less than ten years to a maximum of life in prison, a fine not to exceed $10,000,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
The court ordered that the defendant remain detained pending sentencing.
Assistant United States Attorneys Jonathan D. Lusty and Michael R. Ball are prosecuting this case on behalf of the government.
The Drug Enforcement Administration led the multi-agency investigation of this case, which also included the Homeland Security Investigations, United States Postal Service – Office of Inspector General, United States Postal Inspection Service, Internal Revenue Services, Pittsburgh Bureau of Police, Allegheny County Police, and Pennsylvania State Police. Also assisting were the Jefferson County District Attorney’s Office, Clearfield County District Attorney’s Office, and the Clarion Borough Police Department.
This prosecution is a result of an Organized Crime Drug Enforcement Task Force (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles high-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten communities throughout the United States. OCDETF uses a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.
Three Springfield Men Arrested for Fentanyl DistributionRead the Press Release
BOSTON – Three Springfield men were arrested and charged yesterday in connection with a conspiracy to distribute fentanyl.
Abraham Heredia, 23, and Jose Heredia, Jr., 34, were charged with conspiracy to distribute fentanyl. Lamiek White, 29, was charged with possession of fentanyl with intent to distribute and being a felon in possession of a firearm. The defendants appeared in federal court in Springfield yesterday before U.S. District Court Magistrate Judge Katherine A. Robertson.
According to the charging documents Heredia and Heredia, Jr. conspired on at least two dates to distribute fentanyl. On one occasion on June 7, 2023, the defendants allegedly conspired to distribute more than one and a half kilograms of fentanyl. It is alleged that approximately 200 grams of fentanyl and a firearm with an obliterated serial number were found during a search of White’s residence.
The charge of conspiracy to distribute fentanyl and possession of fentanyl with intent to distribute provides for a sentence of at up to 20 years in prison, at least three years and up to a lifetime of supervised release and a fine of up to $1 million. The charge of being a felon in possession of a firearm provides for a sentence of up to 10 years in prison, up to three years of supervised release and a fine of up to $250,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and statutes which govern the determination of a sentence in a criminal case.
Acting United States Attorney Joshua S. Levy and Christopher DiMenna, Acting Special Agent in Charge of the U.S. Federal Bureau of Investigation, Boston Division made the announcement today. The Bureau of Alcohol, Tobacco, Firearms & Explosives, Boston Field Division; the Holyoke, Springfield, Chicopee, West Springfield and Easthampton Police Departments; the Berkshire, Hampden and Franklin County Sherriff’s Offices; and the Massachusetts State Police Gang Unit provided valuable assistance in the investigation. Assistant U.S. Attorney Neil L. Desroches of Levy’s Springfield Branch Unit is prosecuting the case.
This effort is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.
The details contained in the charging documents are allegations. The defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Three Chinese Chemical Manufacturing Companies and Five Employees Charged with Conspiring to Manufacture FentanylRead the Press Release
Prosecution is Among the First of its Kind
Earlier today, at the federal courthouse in Brooklyn, two indictments were unsealed that detail criminal conspiracies by companies and employees based in China to manufacture and distribute fentanyl in the United States. This prosecution is among the first ever in the United States to charge Chinese chemical manufacturing companies with supplying precursor chemicals used to make fentanyl to the United States.
The first indictment charges Anhui Rencheng Technology Co. (Rencheng), Ltd., Anhui Moker New Material Technology Co., Shutong Wang and Shifang Ruan with conspiracy to manufacture and distribute fentanyl, manufacture of fentanyl, and other related offenses. In addition, the indictment charges those same defendants, as well as Xinyu Zhao and Yue Gao, with illegally concealing their activities, including through customs fraud and introducing misbranded drugs into the United States marketplace. The indictment also charges Rencheng, Wang, and Ruan with conspiracy to distribute butonitazene, a controlled substance.
The second indictment charges Hefei GSK Trade Co., Ltd, also known as “Hebei Gesuke Trading Co. Ltd.” and “Hebei Sinaloa Trading Co., Ltd.”, and Ruiqing Li with similar offenses, including conspiracy to manufacture and distribute fentanyl, manufacture of fentanyl, conspiracy to distribute a List I chemical, distribution of a List I chemical, customs fraud conspiracy, introducing misbranded drugs into interstate commerce, and distribution of metonitazene, a controlled substance.
Merrick Garland, United States Attorney General, Breon Peace, United States Attorney for the Eastern District of New York, Lisa O. Monaco, United States Deputy Attorney General, and Anne Milgram, Administrator, Drug Enforcement Administration (DEA), Keechant, L. Sewell, Commissioner, New York City Police Department, and Steven A. Nigrelli, Acting Superintendent, New York State Police, announced the charges.
“As alleged, the defendants knowingly distributed the chemical building blocks of fentanyl to the United States and Mexico, even providing advice on how they should be used to manufacture this dangerous drug which inflicts untold tragedy in New York City, Long Island and across the nation,” stated United States Attorney Peace. “This prosecution shows that the companies and individuals who fuel our nation’s deadly opioid epidemic—wherever they are located—will be found and prosecuted to the full extent of the law.”
“When I announced in April that the Justice Department had taken significant enforcement actions against the Sinaloa Cartel, I promised that the Justice Department would never forget the victims of the fentanyl epidemic,” said Attorney General Merrick B. Garland. “I also promised that we would never stop working to hold accountable those who bear responsibility for it. That includes not only going after the leaders of the Cartels, their drug and gun traffickers, their money launderers, security forces, and clandestine lab operators. It also includes stopping the Chinese chemical companies that are supplying the cartels with the building blocks they need to manufacture deadly fentanyl.”
“Today’s announcement is a down payment on our pledge to use every tool in the government’s arsenal, in every corner of the globe, to protect American communities,” said Deputy Attorney General Lisa O. Monaco. “The Justice Department will not rest or relent in investigating and prosecuting every link of the fentanyl supply chain, including the PRC companies and executives who produce and export vast quantities of the precursor chemicals the drug cartels need to peddle their poison. There can be no safe haven.”
“Today’s announcement is a considerable step forward in our unrelenting fight against fentanyl, targeting the threat where it starts,” said DEA Administrator Anne Milgram. “These companies and individuals are alleged to have knowingly supplied drug traffickers, in the United States and Mexico, with the ingredients and scientific know-how needed to make fentanyl – a drug that continues to devastate families and communities across the United States, killing Americans from all walks of life. Targeting entire criminal drug networks, from the source of supply to the last mile of distribution, is critical to saving American lives. DEA will not stop until this crisis ends.”
“Today’s charges are further proof of the unceasing, wide-ranging efforts the New York City Police Department will undergo to rid our city of illegal drugs,” stated NYPD Commissioner Sewell. “No matter where or how this poison is manufactured and distributed, we are united with our local, state, federal, and international law-enforcement partners in the fight against drug traffickers. To that end, I thank and commend the U.S. Department of Justice, the Office of the U.S. Attorney for the Eastern District of New York, the U.S. Drug Enforcement Administration, the New York State Police, and everyone else involved in this case for their exceptional work.”
New York State Police Acting Superintendent Nigrelli stated, “The prosecution of these criminals reinforces that we will continue to be vigilant in stopping the flow of dangerous, illegal drugs into our country. The manufacturing and distribution of these highly addictive drugs perpetuates a cycle of substance abuse which poses a significant threat to safety and quality of life within our communities. Drug trafficking organizations of any kind will not be tolerated. I thank the U.S. Attorney’s Office for the Eastern District of New York and our law enforcement partners for their continuing commitment to identify, arrest and prosecute anyone who attempts to infiltrate these dangerous drugs into our nation.”
The misuse of fentanyl, a Schedule II controlled substance, has resulted in one of the deadliest drug threats the United States has ever faced. It is a highly addictive synthetic opioid that is approximately 50 times more potent than heroin and 100 times more potent than morphine.
As alleged in the indictments, the defendant companies supplied precursor chemicals to the United States and Mexico, among other places, knowing they would be used to manufacture fentanyl. The defendant companies openly advertised their products all over the world, including to the United States and Mexico, on social media platforms. They also sent their chemical products to the United States and Mexico by boat and by air, using public and private international mail and package carriers. To prevent detection and interception of chemical products at the borders, the defendant companies employed deceptive and fraudulent practices, such as mislabeling packages, falsifying customs forms, and making false declarations at border crossings. The chemicals distributed by the defendants included all the materials necessary to manufacture fentanyl via the most common pathways.
The defendant companies attempted to obfuscate their distribution of fentanyl precursors by adding “masking” molecules, which slightly alter the chemical signature of the underlying precursor chemicals. By changing the chemical signature, an altered substance could evade testing protocols and relevant regulations by appearing to be a new substance. Such masking molecules are easily removed, thus enabling the purchaser to return the substance to its original form as a fentanyl precursor. The defendant companies not only produced and distributed masked precursors, but also provided instructions about how to remove the masking molecules upon receipt, thus helping their customers to more effectively obtain banned precursors and produce fentanyl. The defendants also gave instructions on how to improve fentanyl yield and advice on which chemicals to buy to replace banned precursor products.
Mexican drug trafficking organizations, including but not limited to the Sinaloa Cartel and the Jalisco New Generation Cartel, have increasingly availed themselves of the fentanyl precursors and masked fentanyl precursors developed and distributed by the defendant companies and companies like them. The chemicals provided by the defendant companies have enabled such cartels and other drug trafficking organizations to produce fentanyl in clandestine laboratories in Mexico on a massive scale, for subsequent distribution in the United States and elsewhere. The materials and instructions provided by the defendant companies and companies like them have directly caused and contributed to the influx of deadly fentanyl into the United States.
The charges in the indictment are allegations, and the defendants are presumed innocent unless and until proven guilty.
The government’s case is being handled by the Office’s International Narcotics and Money Laundering section. Assistant United States Attorneys Francisco Navarro, Erik Paulsen, Chand Edwards-Balfour, Adam Amir and Saritha Komatireddy are in charge of the prosecution with assistance from EDNY Special Agent George Dietz and Paralegal Specialist Bridget Donovan. The joint investigation was conducted by the DEA New York, DEA Mexico, DEA Diversion Control Division, DEA Special Testing and Research Laboratory, United States Customs and Border Protection New York field office, IRS New York Division, and United States Postal Inspection Services of New York. The Justice Department’s Office of International Affairs also provided assistance.
This effort is part of an OCDETF operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF
The Defendants:
Anhui RENCHENG Technology Co., Ltd.
Hefei City, Anhui Province, ChinaAnhui MOKER New Material Technology Co.
Luyang District, Hefei City, Anhui Province, ChinaHEFEI GSK Trade CO., LTD, also known as “Hebei Gesuke Trading Co. Ltd.” and “Hebei Sinaloa Trading Co., Ltd.”
Shushan Economic Development Zone, Hefei City, Anhui Province, ChinaSHUTONG WANG, also known as “王书通”
ChinaShifang RUAN, also known as “Eva” and “阮世芳”
ChinaXinyu Zhao, also known as “Sarah” and “赵新”
ChinaYue Gao, also known as “Ellie” and “高悦,”
ChinaHEFEI GSK Trade CO., LTD, also known as “Hebei Gesuke Trading Co. Ltd.” and “Hebei Sinaloa Trading Co., Ltd.”
ChinaRuiqing Li, also known as “李瑞青”
ChinaE.D.N.Y. Docket Nos. 23-CR-263 and 23-CR-264
23-cr-263_anhi_moker_new_marketing_tech._co_et_al_indictment.pdf 23-cr-264_hefei_gsk_trade_co_ltd._et_al_indictment.pdfStatement of U.S. Attorney Breon Peace on Disruptions of the Fentanyl Precursor Chemical Supply ChainRead the Press Release
"Today we unsealed two indictments collectively charging eight defendants—including three Chinese chemical companies and five Chinese nationals—with, among other crimes, conspiring to manufacture and import fentanyl to the United States. These indictments are among the first in the nation —but not the last—involving companies that provide raw chemicals to drug traffickers knowing that these chemicals will be used to make and distribute fentanyl in the United States.
These charges are the culmination of a year-long investigation, which uncovered that the defendant companies manufactured and stockpiled fentanyl precursors—the chemicals and substances used to manufacture fentanyl and employed chemists to help them market and sell the substances.
The defendant companies openly advertised their products all over the world, including on social media platforms. And while the defendants largely sold the components of fentanyl, most of which were ostensibly legal, they did so as conspirators and accomplices, knowing these substances would be used in a fentanyl manufacturing scheme. As this prosecution shows, that is a crime.
This is akin to a company selling the components for a bomb, knowing they would be used to make an explosive. We know too well that the witches brew of fentanyl chemicals cooked by the drug traffickers can be just as deadly.
The defendants sent their chemicals to the U.S. and Mexico by boat and air, using public and private international mail and package carriers. To prevent detection and interception of chemical products at the borders, the defendant companies employed deceptive and fraudulent practices, such as mislabeling packages as other innocuous products such as cosmetics or food additives, falsifying customs forms, and making false declarations at border crossings.
The defendants also disguised known fentanyl precursors to avoid detection and seizure by law enforcement by adding “masking” molecules, thereby changing the chemical signature of the underlying precursor chemicals to make them harder to detect while passing through Customs and other inspections.
These altered substances could evade testing protocols and relevant regulations by appearing to be a new substance. Such masking molecules are easily removed, enabling the purchaser to return the substance to its original form.
The defendants even provided instructions about how to remove the masking molecules, ensuring their customers were able to use the banned precursor chemicals to manufacture fentanyl. And the defendants gave instructions on how to increase the amount of fentanyl the precursors would produce and advice on which chemicals to buy to replace banned precursor products.
Our investigation also revealed the defendants’ connections to Mexican drug cartels. The defendants communicated with suspected associates of the Sinaloa Cartel and the Cartel Jalisco New Generation in Mexico, advertised their “best-selling products in Mexico,” and even maintained warehouses in Mexico to store precursor chemicals.
The chemicals provided by the defendant companies have enabled cartels and other drug trafficking organizations to produce fentanyl in clandestine laboratories in Mexico on a massive scale, for subsequent distribution in the United States and elsewhere. The materials and instructions provided by the defendant companies and companies like them have directly caused and contributed to the influx of deadly fentanyl into the United States.
The defendants hoped that by selling only the components of fentanyl, or by masking the chemical structures of precursors, or mislabeling their products, they could escape scrutiny and accountability. This prosecution proves them wrong.
To the companies and employees that supply fentanyl precursor chemicals knowing they will be used to make illegal fentanyl, you are drug suppliers, and you are also drug traffickers. We will identify you and prosecute you to the full extent of the law.
The charges brought today exemplify our Office’s battle against fentanyl, which is inflicting untold tragedy in New York City, Long Island, and across the nation. Approximately 80,000 Americans died from fentanyl or other synthetic opioids in 2021—more than gun and auto-related deaths combined. We will not rest until this crisis is over.
Thank you to Attorney General Garland, Deputy Attorney General Monaco, and DEA Administrator Milgram for their leadership in combatting the fentanyl crisis. I’d also like to give special thanks to our law enforcement and agency partners, including DEA New York, DEA Mexico, DEA Diversion Control Division, DEA Special Testing and Research Laboratory, United States Customs and Border Protection’s New York field office, Internal Revenue Service’s New York Division, and United States Postal Inspection Services of New York.
I’d also like to thank the team from my Office who have worked tirelessly to protect our community, Francisco Navarro, Erik Paulsen, Chand Edwards-Balfour, and Adam Amir."
Springfield Man Sentenced for Bank RobberyRead the Press Release
SPRINGFIELD, Mo. – A Springfield, Mo., man was sentenced in federal court today for robbing a local bank.
Richard Lavern Neil Kuder, 26, was sentenced by U.S. Chief District Judge Beth Phillips to nine years in federal prison without parole. The court also ordered Kuder to pay $7,215 in restitution.
On July 24, 2020, Kuder pleaded guilty to one count of bank robbery. Kuder admitted that he stole $7,215 from Central Bank of the Ozarks, 2501 N. Kansas Expressway in Springfield, on June 11, 2020. Kuder presented a bank teller with a note that said, “Very sorry to do this but I need all of the money out of cash register ... This is a robbery.” The teller handed him the cash and Kuder left the bank. He was last seen running through the bank’s parking lot.
In addition to the bank’s surveillance video, numerous businesses near the bank also had surveillance photos of Kuder as he was making his approach to the bank and his getaway after the robbery. Surveillance video showed him hailing a cab, which reported taking Kuder to an apartment complex. Investigators were able to track Kuder to his own apartment complex, which was nearby, and he was identified as a resident. The manager of the apartment complex said Kuder had been behind on his rent, but on the day of the bank robbery, he paid $1,000 cash for his past due rent and his next rental payment.
Detectives contacted Kuder, who was on parole for a previous robbery conviction, and he was taken into custody.
According to court documents, Kuder has two prior felony convictions and 13 prior misdemeanor convictions, including several violent crimes. These crimes of violence have included resisting and striking a law enforcement officer, striking and strangling an unknown man on a local bus and then striking his daughter when she tried to assist her father, and using a firearm to threaten store security and another person.
This case was prosecuted by Assistant U.S. Attorney Patrick Carney. It was investigated by the Springfield, Mo., Police Department, the Greene County, Mo., Sheriff’s Department and the FBI.
Sioux Falls Man Charged in Federal Court with Possession of a Firearm by a Prohibited PersonRead the Press Release
SIOUX FALLS - United States Attorney Alison J. Ramsdell announced today that a man from Sioux Falls, South Dakota, has been indicted by a federal grand jury for Possession of a Firearm by a Prohibited Person.
Israel Estrada, age 29, was indicted on May 2, 2023. He made his initial appearance before U.S. Magistrate Judge Veronica L. Duffy on June 20, 2023, and pleaded not guilty to the Indictment.
The maximum penalty upon conviction is up to 15 years in custody, and/or a $250,000 fine, three years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution and forfeiture may also be ordered.
According to the Indictment, on March 3, 2023, Estrada possessed a firearm, after having been convicted of a felony. The firearm had been previously shipped and transported in interstate and foreign commerce.
The charges are merely accusations, and Estrada is presumed innocent until and unless proven guilty.
This case is part of Project Safe Neighborhoods (PSN), 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.
The investigation is being conducted by Homeland Security Investigations. Assistant U.S. Attorney Jeremy R. Jehangiri is prosecuting the case.
Estrada was remanded to the custody of the U.S. Marshals Service pending further proceedings and trial. A trial date of August 29, 2023, has been set.
Seven Defendants Sentenced to Federal Prison in $11.5 Million Fraud CaseRead the Press Release
LITTLE ROCK— Seven defendants were sentenced to federal prison for their involvement in a scheme to defraud the U.S. Department of Agriculture out of more than $11.5 million that was intended to benefit farmers who had been discriminated against. Chief United States District Judge D.P. Marshall, Jr. sentenced the defendants earlier today.
Four of the defendants, all of whom are sisters, were each sentenced to serve 24 months in federal prison. Lynda Charles, 73, of Hot Springs; Rosie Bryant, 75, of Colleyville, Texas; Delois Bryant, 76, of North Little Rock; and Brenda Sherpell, 73, of Allport; each pleaded guilty on July 6, 2022, to conspiracy to commit mail fraud and to defraud the Internal Revenue Service.
Niki Charles, 50, of Puerto Rico, was sentenced to serve 16 months in federal prison for her involvement in the fraud scheme. Charles admitted during her guilty plea that she and others solicited people to file false claims, asserting they were discriminated against when they tried to get assistance from USDA for their farming operations. Charles said she verified statements from corroborating witnesses who submitted affidavits to support the claims, but none of those witnesses actually appeared before Charles. Those actions resulted in $4.5 million in loss.
Everett Martindale, 76, of Little Rock, was sentenced to a year and a day in federal prison. Martindale worked as an attorney and acted as the legal representative for most of the claimants that the five women recruited. Jerry Green, 42, of Grand Prairie, Texas, a tax preparer hired by the sisters to falsify tax returns, was also sentenced to a serve a year and a day.
As documented in plea agreements, the defendants submitted claims under two programs: the Black Farmers Discrimination Litigation (BFDL) settlement and the Hispanic and Women Farmers and Ranchers (HWFR) claim program. The BFDL settlement resulted from a class action lawsuit filed in 1997 in which a group of black farmers claimed they had been discriminated against when they applied for farm credit, credit servicing, or farm benefits from USDA. Similarly, the HWFR claim program was created after groups of Hispanic and women farmers filed separate lawsuits against USDA, also alleging discrimination in their farm benefit programs.
Both BFDL and HWFR resulted in a claims process where farmers who could show they had applied for participation in a USDA benefit program and believed they had been discriminated against could make a claim for financial relief. A successful claim resulted in an award of $62,500. Of that, $50,000 would be made payable to the claimant, and $12,500 would be transferred directly to the Internal Revenue Service as a tax withholding. Altogether, the sisters were involved with 192 claims, almost all of which were successful, resulting in a loss of over $11.5 million. The claims were false because the claimants had not suffered discrimination and, in most cases, had not even attempted to farm.
The indictment alleged that Martindale would deposit claim checks into his law firm trust account, issue a check from that trust account to the claimant, and withhold his attorney fee. For both BFDL and HWFR, attorney fees were restricted to $1,500 per claimant. The indictment alleged that the four sisters entered an agreement with Martindale in which they would split the attorney fee. The sisters also demanded and received additional money from the claimants themselves.
The money received from a claim was income that should have been reported on the claimant’s tax return. The sisters and their accountant, Green, admitted that Green provided tax preparation services for the claimants they recruited and that Green falsified the tax returns in order to create a tax refund.
Three of the sisters—Lynda Charles, Rosie Bryant, and Delois Bryant—filed false tax returns of their own and used money from the conspiracy to purchase homes and properties, a Chevrolet van, and a Mercedes G550. The United States is pursuing recovery of those assets, and any additional fraud proceeds used to purchase assets, in the criminal case, as well as in a separate civil forfeiture proceeding.
“These sisters defrauded two programs meant to help those that were discriminated against and instead lined their pockets,” said Christopher J. Altemus Jr., Special Agent in Charge IRS Criminal Investigation, Dallas Field Office. “We want every American to take advantage of the programs, deductions, and credits to which they are entitled to by law; however, no one is entitled to defraud the government. Protecting taxpayer money is a matter IRS-CI takes extremely seriously and today’s sentences reinforce our commitment to the public that we will investigate and prosecute those who steal from American taxpayers.”
“Discrimination is real. The 192 settlement claims submitted by these defendants, requesting millions of dollars, were not,” said United States Attorney Jonathan D. Ross. “Today’s sentences send the message that the United States is committed to prosecuting those who steal from programs designed to provide justice for victims of discrimination, and the Court takes seriously crimes such as these. We will continue to seek prison time for fraudsters who re-victimize those the government sought to make whole.”
Special Agent-in-Charge Dax Roberson from the United States Department of Agriculture, Office of Inspector General (USDA-OIG), said, “I want to thank the United States Attorney’s office, USDA-OIG Special Agents, and our investigative partners for their hard work on this investigation. When fraud is committed to deprive proper recipients of USDA funds, OIG will pursue justice to the fullest extent of the law.”
In addition to their sentences of imprisonment, each defendant was sentenced to two years of supervised release following imprisonment, and the defendants were ordered to pay more than $9,000,000 in restitution.
The investigation is being conducted by USDA-OIG and IRS-CI with assistance from the United States Marshals Service and the United States Postal Inspection Service. The case is being prosecuted by Assistant United States Attorneys Cameron McCree, Bart Dickinson, and Amanda Fields.
# # #
This news release, as well as additional information about the office of the
United States Attorney for the Eastern District of Arkansas, is available online at
https://www.justice.gov/edar
Twitter:
@EDARNEWS
Saratoga Springs Man Indicted for Receiving and Possessing Child PornographyRead the Press Release
ALBANY, NEW YORK – Christopher Barry, age 41, of Saratoga Springs, New York, was arrested and arraigned yesterday on an indictment charging receipt and possession of child pornography.
United States Attorney Carla B. Freedman and Matthew Scarpino, Special Agent in Charge of the Buffalo Field Office of Homeland Security Investigations (HSI), made the announcement.
The indictment alleges that between June 2021 and January 2022, Barry received child pornography, and, on February 9, 2023, possessed two phones containing child pornography. The charges in the indictment are merely accusations. The defendant is presumed innocent unless and until proven guilty.
If convicted, Barry would face at least 5 years and up to 20 years in prison, a fine of up to $250,000, and a term of supervised release of at least 5 years and up to life. A defendant’s sentence is imposed by a judge based on the particular statute the defendant is charged with violating, the U.S. Sentencing Guidelines and other factors.
Barry was arraigned yesterday in Albany before United States Magistrate Judge Christian F. Hummel and ordered detained pending trial.
HSI is investigating this case. Assistant U.S. Attorney Alexander P. Wentworth-Ping is prosecuting this case as part of Project Safe Childhood. Launched in May 2006 by the Department of Justice, Project Safe Childhood is led by United States Attorney’s offices and the Criminal Division’s 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 https://www.justice.gov/psc.
San Jose Doctor Convicted of Twelve Counts of Illegally Prescribing OpioidsRead the Press Release
SAN JOSE – A federal jury convicted physician Donald Siao of twelve counts of distributing the controlled substances Oxycodone and Hydrocodone outside of the usual course of his professional practice and without a legitimate medical purpose, announced United States Attorney Ismail J. Ramsey, Drug Enforcement Administration (DEA) Special Agent in Charge Brian M. Clark, and U.S. Department of Health & Human Services Office of Inspector General (HHS-OIG) Special Agent in Charge Steven J. Ryan. The verdicts follow a one-week trial before United States District Judge Beth Labson Freeman.
Siao, 58, is a licensed physician who practices family medicine in San Jose. At trial, evidence demonstrated that after identifying Siao in a separate prescription fraud investigation, investigators reviewed a California state database and discovered Siao had written 8,201 prescriptions for controlled substance medications in just the one-year period from May 2016 to May 2017. An investigation followed and resulted in Siao prescribing Oxycodone and Hydrocodone in increasing quantities over seventeen visits by four separate undercover law enforcement agents posing as patients. The undercover agents received prescriptions from Siao despite complaining of only vague pain or discomfort, requesting specific opioids by name, and admitting to sharing the pills with friends and coworkers.
Evidence at trial further established that Siao prescribed dangerous opioids to his patients E.J. and A.J., a mother and son, notwithstanding obvious red flags. Siao continued to prescribe opioids to the mother E.J. after she repeatedly claimed that her pills had been lost or stolen, despite Siao receiving an alert from E.J.’s insurer regarding her opioid prescriptions and despite Siao being advised that E.J. was jailed for selling pills, which was documented in Siao’s medical file for E.J. Similarly, Siao prescribed opioids to the son A.J. after he overdosed twice. Siao continued to prescribe opioids to A.J. after A.J. repeatedly claimed the opioids were lost or stolen and even after he had been flagged by his prior medical provider for drug-seeking behavior, after his mother reported he had stolen her medications, and after A.J.’s mother E.J. fatally overdosed on opioids. These facts were all documented in Siao’s medical file for A.J.
Trial evidence also demonstrated that Siao refused to heed warnings that his prescriptions were dangerous. Evidence showed Siao was aware that DEA closely scrutinized opioid prescriptions and pointed out to one of the undercover officers posing as a patient that a nationwide epidemic was underway in which large numbers of people were addicted to and dying from opioids. Siao nevertheless continued to prescribe opioids to the agents upon their request and with little to no physical examination, sometimes after visits lasting only a few minutes. Law enforcement agents interviewed Siao in November 2018 about his prescribing practices, and Siao admitted he was aware of the California Medical Board’s Guidelines for Prescribing Controlled Substances for Pain. During trial, Siao also admitted that he had been taught about the dangers of addiction and how to identify drug-seeking patients.
The jury convicted Siao of twelve counts of distributing opioids outside the usual course of professional practice and without a legitimate medical purpose, all in violation of 21 U.S.C. § 841(a)(1). Of the 12 counts, four related to the undercover agents and eight related to E.J. and A.J.
U.S. District Judge Freeman scheduled Siao’s sentencing for November 7, 2023. Each of the twelve counts carries a maximum sentence of 20 years in prison. The United States is also seeking forfeiture of Siao’s medical license. The court may also order additional fines, restitution, and supervision upon release from prison as part of any sentence. However, any sentence will be imposed by a court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Assistant U.S. Attorneys Amani Floyd and Dan Karmel are prosecuting the case with the assistance of Mimi Lam. The prosecution is the result of an investigation by DEA, HHS-OIG, and the California Department of Justice Division of Medi-Cal Fraud and Elder Abuse.
The case was investigated and prosecuted by member agencies of the Organized Crime Drug Enforcement Task Force (OCDETF), a focused multi-agency, multi-jurisdictional task force investigating and prosecuting the most significant drug trafficking organizations throughout the United States by leveraging the combined expertise of federal, state, and local law enforcement agencies.
Resumen Del Viaje A Colombia Del Fiscal General Adjunto Kenneth A. Polite, Jr.Read the Press Release
Del 20 al 23 de junio, el fiscal general adjunto (AAG por sus siglas en inglés) Kenneth A. Polite, Jr., de la División Penal del Departamento de Justicia, viajó a Bogotá, Colombia, para reunirse con sus homólogos colombianos, socios encargados de hacer cumplir la ley, y personal de la División Penal asignado a la Embajada de Estados Unidos en Bogotá para discutir los esfuerzos de aplicación de la ley entre nuestros dos países y avanzar en la relación bilateral con Colombia.
El miércoles, el AAG Polite se reunió con los nueve magistrados de la Sala Penal de la Corte Suprema de Justicia de Colombia. También se reunió con los principales colaboradores de las fuerzas del orden estadounidense que trabajan en Colombia, con el personal de la División de Asuntos Penales destinado en la Embajada de Estados Unidos en Bogotá, y con miembros de la Policía Nacional y de la Fiscalía General de Colombia que prestan apoyo a las investigaciones bilaterales para combatir a las organizaciones delictivas transnacionales. El AAG Polite agradeció a las fuerzas del orden estadounidense y colombianas su estrecha colaboración y su excelente asociación, así como su compromiso para mejorar la seguridad de la región.
AAG Polite con los magistrados de la Sala Penal de la Corte Suprema de Justicia de Colombia.
El jueves, el AAG Polite se reunió con el fiscal general de Colombia, Francisco Barbosa, el ministro de justicia de Colombia, Néstor Iván Osuna Patiño, y el director general de la Policía Nacional de Colombia, William René Salamanca, para hablar de las prioridades comunes en materia de aplicación de la ley, como la desarticulación de organizaciones delictivas transnacionales, la interrupción del flujo de narcóticos ilegales y de la violencia que se le atribuye, la lucha contra el blanqueo de capitales y la incautación y el decomiso de bienes adquiridos con el producto de conductas ilegales. En las reuniones, el AAG Polite se mostró interesado en seguir apoyando la estrecha colaboración entre Estados Unidos y Colombia en materia de justicia bilateral, así como en la forma en que Estados Unidos puede seguir apoyando los esfuerzos de Colombia para mejorar la justicia y la seguridad rurales.
El fiscal de Colombia, Francisco Barbosa y AAG Polite.
El ministro de justicia de Colombia, Néstor Iván Osuna Patiño y AAG Polite.
El director general de la Policía Nacional de Colombia William René Salamanca y AAG Polite.
“Nuestra relación con Colombia en materia de aplicación de la ley es un modelo para la region,” declaró el AAG Polite. “Agradecemos a Colombia sus muchos años de colaboración con el Departamento de Justicia y con las fuerzas del orden estadounidense en materia de justicia. Nos comprometemos a seguir colaborando estrechamente para combatir la delincuencia organizada transnacional, detener el flujo de estupefacientes hacia Estados Unidos e interrumpir el flujo de financiación ilícita.”
Durante la visita, AAG Polite también visitó una Casa de Justicia, que forma parte de un importante programa de acceso a la justicia que tiene por objetivo ofrecer una amplia gama de servicios judiciales a los ciudadanos colombianos. AAG Polite habló sobre la importancia de las iniciativas de acceso a la justicia y de cómo Colombia y Estados Unidos pueden aprender el uno del otro en esta materia.
AAG Polite visita una Casa de Justicia.
AAG Polite sigue comprometido con la continua cooperación entre los Estados Unidos y Colombia y nuestros homólogos judiciales y policiales en la región.
AAG Polite a Plaza de Bolívar.
Recidivist Fraudster Charged with Fraud and Identity Theft in Connection with Real Estate Investment Ponzi SchemeRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, and Michael J. Driscoll, the Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced today the unsealing of an Indictment charging WILSON BASTON, a/k/a “Chanon Gordon,” a/k/a “William Baston,” a/k/a “Jackie Wilson,” with wire fraud, securities fraud, and aggravated identity theft in connection with a scheme to defraud investors in a series of purported real estate investments managed by BASTON and the entity Gordon Management Group (“GMG”). BASTON was arrested this morning in New York and was presented in federal court this afternoon.
U.S. Attorney Damian Williams said: “As alleged, Wilson Baston used a fake name to conceal his prior convictions and to solicit more than $10 million as part of a series of brazen real estate scams against innocent New Yorkers. Today’s arrest demonstrates this Office’s commitment to stopping recidivist fraudsters like Baston and to seeking justice for victims of financial frauds.”
FBI Assistant Director in Charge Michael J. Driscoll said: “As alleged, the defendant ran a fraudulent scheme which used funds intended for real estate investment to repay other investors or use on lavish personal expenses. This fraud, like many Ponzi schemes, guaranteed large returns on investment, but proved too good to be true. The FBI will continue to ensure that fraudsters are held responsible for their scams in the criminal justice system.”
According to the allegations in the Indictment unsealed in Manhattan federal court:[1]
Between 2018 and 2023, WILSON BASTON engaged in a scheme to defraud investors in a series of purported real estate investments managed by GMG. In order to defraud his investors, BASTON falsely represented that he would use investor money to fund real estate transactions in the New York City area. However, in truth and in fact, BASTON operated GMG as a Ponzi scheme. Rather than use investment contributions to fund real estate transactions as he promised, BASTON instead used funds from new and existing investors to repay money that was owed to other investors. BASTON also misappropriated investor funds by spending them on personal expenses such as payments to a luxury carmaker.
BASTON typically made false promises of guaranteed short-term, high rates of return on investments in real estate deals, with additional guarantees on the principal investment. On many occasions, BASTON initially repaid both the principal and interest as promised to garner trust with his investors and entice them to continue investing in GMG — and in many cases, to invest additional, larger sums of money. BASTON then ceased paying the victims the promised interest and did not return the principal on the deals they had invested in.
Eventually, when victims began to complain to BASTON about not getting their money as promised, BASTON provided increasingly outlandish excuses and avoided responding to their inquiries. At times, BASTON also gave false excuses and explanations as to why the investors had not been paid.
In some instances, BASTON paid investors with the funds he received from existing investors, or the funds of new investors, rather than from any purported investments, in a Ponzi-like fashion. BASTON also used certain investment funds for personal expenditures. Further, in order to avoid detection and falsely instill confidence in his investors, BASTON, who was previously convicted in federal court of 17 counts of mail and wire fraud for operating a similar fraudulent investment scheme, hid his true identity and the fact of his prior conviction from his investors by falsely representing that his name was “Chanon Gordon.”
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WILSON BASTON, 62, of Brooklyn, New York, is charged with one count of wire fraud and one count of securities fraud, each of which carries a maximum sentence of 20 years in prison, and one count of aggravated identity theft, which carries a two-year mandatory sentence in addition to any sentence imposed.
The statutory maximum and mandatory penalties in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by a judge.
Mr. Williams praised the outstanding work of the FBI on the investigation. Mr. Williams further thanked the U.S. Securities and Exchange Commission for its assistance and cooperation in this investigation.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Alex Rossmiller and Nicholas Folly are in charge of the prosecution.
The charges in the Indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Indictment and the description of the Indictment set forth in this release constitute only allegations, and every fact described should be treated as an allegation.
U.S. v. Baston Indictment