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22 February 2023
Two Men Sentenced for Laundering Proceeds of a Business Email Compromise SchemeRead the Press Release
ALEXANDRIA, Va. – Two men were sentenced today to over 14 years in prison combined for money laundering as part of a business email compromise (BEC) scheme.
According to court documents, Onyewuchi Victor Ibeh, 33, of Mitchellville, Maryland, and Jason Eugene Joyner, 42, of Hyattsville, Maryland, participated in a scheme to launder the proceeds of a BEC scheme. In this scheme, conspirators infiltrate the computer systems of a victim company, including their email servers and email accounts, through phishing attacks or the use of malware. Once there, the conspirators impersonate the victim’s business partner and claim the business partner’s bank account information has changed. Intending to send the money to the business partner, the victim business instead sends the money to bank accounts controlled by the conspirators.
According to trial testimony, the network of accounts operated by defendants laundered about $13 million fraudulently obtained from numerous victim businesses between July 2016 and May 2020. Five of the defrauded businesses testified at trial, including one headquartered in Falls Church, Virginia. The co-conspirators laundered the proceeds of the scheme through various financial transactions using dozens of bank accounts that they directly and indirectly controlled. Joyner’s role in the scheme was to withdraw the proceeds of the fraud in cash, which he delivered to other conspirators, including Ibeh. Ibeh’s role in the scheme was to manage the money laundering by causing conspirators to open bank accounts, which he used to wire money domestically and internationally. Ibeh spent the proceeds of the fraud on luxury items, including a custom jewelry piece costing close to $40,000.
Ibeh was sentenced to 10 years and Joyner was sentenced to 51 months in prison. Ibeh and Joyner conspired with, among others, Anthony Ayeah and Mouaaz Elkhebri, both of whom have also been convicted of conspiracy to commit money laundering.
Jessica D. Aber, U.S. Attorney for the Eastern District of Virginia; Michael Ray, Inspector in Charge of Cybercrime and National Security of the U.S. Postal Inspection Service; and Matthew Stohler, Special Agent in Charge of the U.S. Secret Service’s Washington Field Office, made the announcement after sentencing by Senior U.S. District Judge Claude M. Hilton.
Assistant U.S. Attorney Christopher Hood, Assistant U.S. Attorney Russell Carlberg, and Special Assistant U.S. Attorney Elizabeth Bagwell prosecuted the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:21-cr-200.
Two Business Owners Sentenced for Conspiring to Pay Bribes in Exchange for Municipal Contracts in Puerto RicoRead the Press Release
SAN JUAN, Puerto Rico – Two government contractors were sentenced this week for their involvement in separate bribery schemes in which they gave payments to the mayor of the municipality of Cataño, Puerto Rico, in exchange for the mayor’s awarding of municipal contracts to their respective companies.
Mario Villegas-Vargas, 44, of Gurabo, Puerto Rico, was sentenced today to 46 months in prison for conspiracy to commit federal funds bribery. According to court documents, Villegas-Vargas paid kickbacks and bribes in exchange for the mayor exerting his influence on municipal officials in Cataño to ensure that Villegas-Vargas’ asphalt and paving business, JR Asphalt, was awarded municipal contracts. Villegas-Vargas’ bribe payments and his efforts to conceal those payments resulted in his business being awarded over $9.9 million in municipal contracts in Cataño.
Other public officials in Puerto Rico have already pleaded guilty to receiving bribe payments from JR Asphalt, including the former mayors of Aguas Buenas, Guayama, and Trujillo Alto and the former Directors of Public Works in Guayama and Cataño.
Jose Bou-Santiago, 50, of Bayamon, Puerto Rico, was sentenced yesterday to two years in prison for conspiracy to commit federal funds bribery. According to court documents, in April 2019, Bou-Santiago provided a Rolex watch to the mayor of Cataño in exchange for a future municipal contract for Bou-Santiago’s company, Bou Maintenance Service. Specifically, in June 2019, Bou Maintenance Service was awarded a construction contract by the municipality valued at approximately $190,000.
Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division, U.S. Attorney W. Stephen Muldrow for the District of Puerto Rico, Assistant Director Luis Quesada of the FBI’s Criminal Investigative Division, and Special Agent in Charge Joseph Gonzalez of the FBI San Juan Field Office made the announcement.
The FBI San Juan Field Office investigated the cases.
Trial Attorneys Nicholas W. Cannon and Ryan R. Crosswell of the Criminal Division’s Public Integrity Section and Chief of the Financial Fraud and Public Corruption Section Seth A. Erbe for the District of Puerto Rico prosecuted the cases.
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Two Business Owners Sentenced for Conspiring to Pay Bribes in Exchange for Municipal Contracts in Puerto RicoRead the Press Release
Two government contractors were sentenced this week for their involvement in separate bribery schemes in which they gave payments to the mayor of the municipality of Cataño, Puerto Rico, in exchange for the mayor’s awarding of municipal contracts to their respective companies.
Mario Villegas-Vargas, 44, of Gurabo, Puerto Rico, was sentenced today to 46 months in prison for conspiracy to commit federal funds bribery. According to court documents, Villegas-Vargas paid kickbacks and bribes in exchange for the mayor exerting his influence on municipal officials in Cataño to ensure that Villegas-Vargas’ asphalt and paving business, JR Asphalt, was awarded municipal contracts. Villegas-Vargas’ bribe payments and his efforts to conceal those payments resulted in his business being awarded over $9.9 million in municipal contracts in Cataño.
Other public officials in Puerto Rico have already pleaded guilty to receiving bribe payments from JR Asphalt, including the former mayors of Aguas Buenas, Guayama, and Trujillo Alto and the former Directors of Public Works in Guayama and Cataño.
Jose Bou-Santiago, 50, of Bayamon, Puerto Rico, was sentenced yesterday to two years in prison for conspiracy to commit federal funds bribery. According to court documents, in April 2019, Bou-Santiago provided a Rolex watch to the mayor of Cataño in exchange for a future municipal contract for Bou-Santiago’s company, Bou Maintenance Service. Specifically, in June 2019, Bou Maintenance Service was awarded a construction contract by the municipality valued at approximately $190,000.
Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division, U.S. Attorney W. Stephen Muldrow for the District of Puerto Rico, Assistant Director Luis Quesada of the FBI’s Criminal Investigative Division, and Special Agent in Charge Joseph Gonzalez of the FBI San Juan Field Office made the announcement.
The FBI San Juan Field Office investigated the cases.
Trial Attorneys Nicholas W. Cannon and Ryan R. Crosswell of the Criminal Division’s Public Integrity Section and Chief of the Financial Fraud and Public Corruption Section Seth A. Erbe for the District of Puerto Rico prosecuted the cases.
Three Individuals Sentenced for Firearm Straw Purchasing ConspiracyRead the Press Release
NORFOLK, Va. – Three individuals were sentenced today and last week to 58 months in prison combined for engaging in a straw purchasing conspiracy.
According to court documents, from March 2020 through July 23, 2020, David Collins, 34, of Vineland, New Jersey, Cardel Howard, 36, of Norfolk, and Felicia Tyson, 36, also of Norfolk, conspired together to straw purchase firearms in Virginia Beach, and traffic the firearms to New Jersey. During the conspiracy, Tyson acted as a straw purchaser of firearms on behalf of others, including defendants Howard and Collins.
In total, Tyson purchased seven firearms and attempted to purchase an eighth firearm for other individuals. Howard directed Tyson as to which firearms to purchase and how much to charge others for firearms. Collins traveled from New Jersey to Virginia for the purpose of acquiring a firearm in Virginia, which he could not acquire on his own because he is a convicted felon and a resident of New Jersey. The investigation into this group began after law enforcement in New Jersey recovered a firearm during a shooting investigation and determined that the firearm was previously purchased by Tyson.
Collins was sentenced today to 22 months in prison. On February 15, Howard was sentenced to 22 months’ incarceration for his role in the conspiracy. On February 8, Tyson was sentenced to 14 months' incarceration for her role in the conspiracy.
Jessica D. Aber, U.S. Attorney for the Eastern District of Virginia, and Darrell Longwood, Acting Special Agent in Charge of the ATF’s Washington Field Division, made the announcement after sentencing by U.S. District Judge Elizabeth W. Hanes.
Assistant U.S. Attorney Megan Montoya prosecuted the case.
This case is part of Project Safe Neighborhoods (PSN), which is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
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. 2:22-cr-76.
Third and Pike armed drug dealer sentenced to five years in prisonRead the Press Release
Seattle – A 31-year-old Seattle man was sentenced today in U.S. District Court in Seattle to five years in prison for federal crimes related to his distribution of fentanyl pills in downtown Seattle and his armed shoplifting in Bellevue, announced U.S. Attorney Nick Brown. Kendall Alston was arrested on March 23, 2022, after Seattle Police Officers noted his hand-to-hand drug sales. The officers had been surveilling the area of 3rd Avenue between Pike and Pine Streets as part of “Operation New Day.” The emphasis patrol was aimed at increasing public safety in the Pike/Pine corridor where drug sales had led the area to become a hot spot for other crimes including assaults and shootings.
“Mr. Alston was armed with a loaded handgun while dealing potentially deadly fentanyl pills in downtown Seattle,” said U.S. Attorney Nick Brown. “Drugs and guns are a deadly combination and getting both off the street is a priority for the community.”
According to records filed in the case and testimony at trial, an officer in an observation point above the street witnessed a person in distinctive clothing engaging in what appeared to be a hand-to-hand drug sale. The officer returned to street level and saw the person later identified as Alston make another drug sale. Officers moved in and took Alston into custody. Alston carried 244 blue pills that were later tested and found to contain fentanyl. In his backpack, Alston carried a loaded Hi-Point .45 caliber semi-automatic handgun.
After a 3-day trial in August 2022, the jury deliberated about three hours before finding Alston guilty of knowingly distributing fentanyl, possession of fentanyl with intent to distribute, and possession of a firearm in furtherance of a drug trafficking crime. Following the guilty verdicts, Alston agreed to plead guilty to two additional counts of being a felon in possession of a firearm. The counts are related to his March arrest in downtown Seattle with the firearm, and a previous January 2022 arrest for shoplifting in Bellevue, where he was found to be carrying a different firearm.
Alston is prohibited from possessing firearms due to two felony convictions, a 2018 residential burglary conviction in Pierce County, and a 2013 residential burglary conviction in King County.
At the sentencing hearing U.S. District Judge Lauren J. King noted Alston was “an intelligent young man engaging in high-risk behavior…. Possessing a firearm while dealing drugs adds to the danger.”
The case was investigated by the Seattle Police Department with assistance from the Drug Enforcement Administration.
The case was prosecuted by Assistant United States Attorneys Cecelia Gregson and Casey Conzatti.
Texan sentenced for transporting people in trunkRead the Press Release
CORPUS CHRISTI, Texas – A 40-year-old San Antonio resident has been ordered to federal prison for transporting undocumented aliens, announced U.S. Attorney Alamdar S. Hamdani.
Bryan Tanner pleaded guilty Dec. 1, 2022.
Today, U.S. District Judge David S. Morales ordered Tanner to serve 37 months in federal prison to be immediately followed by three years of supervised release. At the hearing, the court heard evidence that while committing the offense, he possessed a loaded firearm that was readily available to him in the car. In imposing the sentence, Judge Morales noted the dangerousness of the offense and also considered Tanner’s criminal history which includes prior convictions for possession and distribution of a controlled substance.
On Sept. 8, 2022, Tanner approached the Border Patrol checkpoint near Sarita. He appeared nervous and could not answer law enforcement’s questions.
They asked to check the vehicle, at which time Tanner attempted to flee the checkpoint. Authorities stopped him and discovered three individuals concealed inside the trunk. Two of the individuals indicated they had been there for at least three hours.
The temperature inside the area was over 99 degrees.
Law enforcement also discovered a loaded 9mm handgun stashed between the driver’s seat and center console of the car.
Tanner has been and will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
Customs and Border Protection conducted the investigation. Assistant U.S. Attorney Ashley Martin prosecuted the case.
Terrebonne Parish Man Sentenced for Violating the Federal Controlled Substances ActRead the Press Release
NEW ORLEANS, LOUISIANA – DERECK CELESTIN, JR., age 37, a resident of Terrebonne Parish, Louisiana, was sentenced on February 16, 2023 to 120 months imprisonment, 5 years of supervised release, and a mandatory $200 special assessment fee by U.S. District Judge Susie Morgan, after pleading guilty to a two-count indictment which charged him with distribution of methamphetamine in violation of Title 21, United States Code, Sections 841(a)(1), 841(b)(1)(B), and 841(b)(1)(A), announced U.S. Attorney Duane A. Evans.
According to court documents, a Drug Enforcement Administration (DEA) investigation revealed that CELESTIN was a methamphetamine distributor in Terrebonne Parish. DEA agents arranged two controlled purchases of methamphetamine from CELESTIN. On July 13, 2021, agents arranged the purchase of 48.73 grams of methamphetamine from CELESTIN. On August 9, 2021, agents arranged the purchase of 130.35 grams of methamphetamine from CELESTIN.
This case was investigated by the Drug Enforcement Administration and Terrebonne Parish Sheriff’s Office. The prosecution was handled by Assistant United States Attorney J. Benjamin Myers of the Narcotics Unit.
Shreveport Man on Supervised Release for Previous Federal Conviction Sentenced for Possessing a FirearmRead the Press Release
SHREVEPORT, La. – Charles M. Thomas, 26, of Shreveport, Louisiana, was sentenced today for being a convicted felon in possession of a firearm and for violating the terms of his federal supervised release, announced United States Attorney Brandon B. Brown. United States District Judge S. Maurice Hicks, Jr. sentenced Thomas to 46 months in prison, followed by 3 years of supervised release on the firearms charge.
Thomas was indicted in March 2022 and charged with possession of a firearm and ammunition by a convicted felon and pleaded guilty to the charge on August 4, 2022. The charge stems from an incident which occurred on March 7, 2022, when officers with the Shreveport Police Department arrested Thomas for domestic violence. Further investigation by law enforcement agents with the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) led to the discovery of video evidence of Thomas being in possession of a firearm. Agents knew that Thomas had previously been convicted in the Western District of Louisiana in 2018 for being a convicted felon in possession of a firearm and at the time of this arrest for domestic violence, was on supervised release for that conviction. During a search of the apartment where Thomas was staying, agents discovered a bag containing .223 and 5.56 caliber ammunition which belonged to Thomas. The ammunition was compatible with the firearm that Thomas was seen holding in the video. In addition, agents found in the apartment the same sweatpants that Thomas was wearing in the video. Thomas has a prior felony conviction for aggravated assault with a firearm (2015) and the prior felon in possession of a firearm conviction (2018) in the Western District of Louisiana.
Thomas was found to be in violation of his federal supervised release, and he was sentenced to an additional 14 months in prison to run consecutive with the above sentence.
The case was investigated by the ATF and Shreveport Police Department and prosecuted by Assistant U.S. Attorney Seth D. Reeg.
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Sanostee man pleads guilty to voluntary manslaughterRead the Press Release
ALBUQUERQUE, N.M. – Alexander M.M. Uballez, United States Attorney for the District of New Mexico, announced today that Tyrone Atcitty Nez pleaded guilty to voluntary manslaughter. Nez, 33, of Sanostee, New Mexico, and an enrolled member of the Navajo Nation, will remain in custody pending sentencing, which has not been scheduled.
According to the plea agreement and other court records, on June 8, 2022, Nez fatally assaulted a man, identified as John Doe, in the home where Nez resides near Sanostee on the Navajo Nation. Nez allegedly punched John Doe in the face, rendering John Doe unconscious. Nez then allegedly stomped the victim in the face several times. John Doe died as a result of his injuries.
Nez faces up to 17 years in prison.
The Farmington Resident Agency of the FBI Albuquerque Field Office investigated this case with assistance from the Navajo Police Department. Assistant United States Attorney Brittany DuChaussee is prosecuting the case.
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Salem Man Pleads Guilty for Using Twitter to Threaten Violence Against Robinhood EmployeesRead the Press Release
PORTLAND, Ore.—A Salem, Oregon man pleaded guilty today for using Twitter to threaten violence against employees of Robinhood Markets, Inc., an online financial services company based in Menlo Park, California.
Christopher David Michalski, 39, pleaded guilty to one count of interstate communication of threats.
According to court documents, on or about April 14, 2022, a Robinhood employee contacted the FBI to report a series of Twitter posts spanning nearly a year threatening violence toward Robinhood employees, including its Chief Executive Officer and his family. Further investigation revealed that the Twitter account used to transmit the threats, @goldshroomand1, was associated with the internet protocol address of Michalski’s home in Salem and that several photos of firearms accompanying the threats were taken at a nearby shooting range.
On April 25, 2022, Michalski was charged by criminal complaint with interstate communication of threats. The next week, on May 4, 2022, special agents from the FBI and officers from the Salem Police Department arrested Michalski without incident. On May 19, 2022, Michalski was indicted by a federal grand jury in Portland.
Michalski faces a maximum sentence of five years in federal prison, a $250,000 fine, and three years’ supervised release. He will be sentenced on May 15, 2023, by U.S. District Court Judge Michael H. Simon.
This case was investigated by the FBI with assistance from the Salem Police Department’s Strategic Investigation Unit. It was prosecuted by Scott M. Kerin, Assistant U.S. Attorney for the District of Oregon.
Russian Malware Developer Arrested and Extradited to the United StatesRead the Press Release
Tampa, Florida – United States Attorney Roger B. Handberg announces the arrest and extradition of Dariy Pankov a/k/a “dpxaker.” Pankov is charged with conspiracy, access device fraud, and computer fraud. If convicted on all counts, he faces a maximum penalty of 47 years in federal prison. The indictment also notifies Pankov that the United States intends to forfeit $358,437, which is alleged to be traceable to proceeds of the offenses.
Pankov, a citizen and resident of Russia, was taken into custody by Georgian authorities in the Republic of Georgia, on October 4, 2022, and extradited to the United States pursuant to a request from the United States. Pankov appeared before United States Magistrate Christopher P. Tuite on February 21, 2023, in Tampa, Florida and was ordered detained pending trial.
According to the indictment, Pankov developed a malicious software program named “NLBrute.” The powerful malware was capable of compromising protected computers by decrypting login credentials, such as passwords. Pankov used NLBrute to obtain the login credentials of tens of thousands of computers located all over the world. He marketed, sold, and had others sell on his behalf, NLBrute to other cybercriminals for a fee. Pankov sold the stolen login credentials on a dark web website that specialized in the purchase and sale of access to compromised computers. Once sold, those credentials were used to facilitate a wide range of illegal activity, including ransomware attacks and tax fraud. Pankov listed the credentials of more than 35,000 compromised computers for sale on the website, and obtained more than $350,000 in illicit proceeds.
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 investigation was led by the Internal Revenue Service—Criminal Investigation, Tampa Field Office, and the Federal Bureau of Investigation, Tampa Field Office. Substantial assistance was provided by the Department of Justice’s Office of International Affairs and United States Marshals Service. This investigation also benefited from foreign law enforcement cooperation by the Georgian Prosecutor General’s Office, Ministry of Justice, and Ministry of Internal Affairs. It will be prosecuted by Assistant United States Attorney Carlton C. Gammons.
Download IndictmentRensselaer County Sex Offender Arrested for Sexually Exploiting a Child, Receiving Child PornographyRead the Press Release
ALBANY, NEW YORK – Zachary Cota, age 29, of Castleton-on-Hudson, New York, was arrested today for sexually exploiting a child and receiving child pornography. 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.
A criminal complaint alleges that between May 27, 2022 and June 7, 2022, Cota sexually exploited an 8-year-old child residing outside of New York State and also received child pornography.
The charges in the criminal complaint are merely accusations. The defendant is presumed innocent unless and until proven guilty.
Cota appeared today in Albany, before United States Magistrate Judge Christian F. Hummel, and was ordered detained pending further proceedings.
Upon conviction, the charges filed against Cota carry a mandatory minimum term of 25 years in prison and a maximum of 90 years in prison, as well as 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.
The case is being investigated by the FBI and its Child Exploitation Task Force, which includes members of federal, state, and local law enforcement agencies, including the Rotterdam, Troy, and Colonie Police Departments and the New York State Police. Assistant U.S. Attorneys Jonathan S. Reiner and Rachel L. Williams are prosecuting the 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.
Recidivist Fraudster Pleads Guilty to Fraud, Identity Theft, and Making False Statements in Connection with Andrews Air Force Base Construction ContractRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, announced that RAYMOND WHITE, a/k/a “John Raymond Anthony White,” a/k/a “Raymond Alexander White,” pled guilty yesterday to a scheme in which he defrauded the government by submitting fraudulent documents and false information about himself, his company’s business, and his company’s finances in order to obtain a $4.8 million contract to build a munitions load crew training facility at Joint Base Andrews, Maryland (“Andrews Air Force Base”), and to obtain a bond guarantee from the United States Small Business Administration (“SBA”) in connection with the contract. WHITE also committed aggravated identity theft by using another person’s signature and Social Security number. WHITE pled guilty before United States District Judge Edgardo Ramos.
U.S. Attorney Damian Williams said: “Despite a prior conviction by this Office, Raymond White continued to lie and fabricate information in order to line his own pockets. This time, White defrauded the government, submitting fraudulent documents and false information to obtain a nearly $5 million construction contract and to obtain a bond guarantee from the SBA in connection with the contract. This Office will continue to prosecute recidivist fraudsters until the message is clear and they have learned their lesson: committing financial fraud will lead to significant penalties.”
According to the Complaint, Superseding Indictment, public court filings, and statements made in court:
From in or about May 2019 through in or about September 2020, WHITE submitted a bid and related documents to the District of Columbia Army National Guard (“National Guard”) on a contract (the “Contract”) to build a munitions load crew training facility at Andrews Air Force Base. Prior to obtaining the Contract, WHITE provided the National Guard with fraudulent documents about himself and his company, Kochendorfer Group USA Inc., (“Kochendorfer”). WHITE submitted similar information to the SBA to obtain a guarantee from the SBA that was a requirement for obtaining the Contract.
The fraudulent documents that WHITE submitted to the National Guard and the SBA included a doctored bank account statement, fake reports from an accounting firm that WHITE had invented, and falsified financials. These documents purported to show that Kochendorfer had significant cash assets. In fact, Kochendorfer had virtually no money. WHITE also submitted a false resume and firm dossier, which described fictitious construction jobs and provided fake references. WHITE claimed, among other things, that he had overseen the construction of a World Cup soccer stadium in Brazil from 2012 to 2014 when in fact, WHITE was in federal prison during that time frame, serving a prison term on a prior fraud conviction. WHITE also lied to the SBA by denying that he had any prior criminal convictions. In furtherance of this fraud on the National Guard and the SBA, WHITE forged the signature of an attorney on a Kochendorfer letter and used another individual’s Social Security number on his SBA guarantee application.
Based on WHITE’s misrepresentations, the National Guard awarded the Contract to Kochendorfer and the SBA issued a guarantee. The National Guard terminated the Contract after discovering WHITE’s fraud, and no construction work was ever performed on the site. As a result of the Contract’s termination, the SBA has fulfilled multiple claims pursuant to the guarantee provided by the SBA.
In 2011, WHITE was convicted following a jury trial in the U.S. District Court for the Southern District of New York under the name “John Raymond Anthony White” for engaging in major fraud, mail fraud, false statements, and witness tampering. United States v. John Raymond Anthony White, S1 10 Cr. 516 (SHS). WHITE’s prior conviction arose out of his fraud in the procurement of four government contracts, for a scheme in which he falsely represented that he was a disabled veteran. As a result of his 2011 federal conviction, WHITE and his prior construction company, Mitsubishi Construction Corporation, were excluded from government contracting for a period of five years. The name that WHITE used in connection with the Contract — Raymond White — was different from the name he had used in connection with the government contracts at issue in his prior federal conviction.
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WHITE, 58, of New York, New York, pled guilty to one count of major fraud against the United States, which carries a maximum sentence of 10 years in prison; two counts of wire fraud, each of which carries a maximum sentence of 20 years in prison; two counts of false statements and false writings, each of which carries a maximum sentence of five years in prison; and one count of aggravated identity theft, which carries a consecutive mandatory minimum sentence of two years in prison.
The minimum and maximum potential sentences 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. Sentencing is scheduled for May 23, 2023, at 11:00 a.m.
Mr. Williams praised the work of the Air Force Office of Procurement Fraud Investigations and Office of Special Investigations and the Army Major Procurement Fraud Unit in this investigation.
The case is being handled by the Office’s General Crimes Unit. Assistant U.S. Attorneys Edward C. Robinson Jr., Jessica Greenwood, and Frank Balsamello are in charge of the prosecution, with the assistance of Paralegal Specialist Maria Gatica.
Portland Man Sentenced to Federal Prison for Assaulting Postal EmployeeRead the Press Release
PORTLAND, Ore.—On February 21, 2023, a Portland man was sentenced to federal prison for punching a U.S. Postal Service employee after stealing several trays of mail from a post office.
Dellmon Timmy Smith, 53, was sentenced to 30 months in federal prison and three years’ supervised release.
According to court documents, on November 22, 2021, Smith—who has a criminal history spanning decades that includes multiple felony convictions for theft and making threats of violence during his various thefts—entered a back door of the Creston U.S. Post Office on SE Foster Road in Portland, pushed past a postal service employee, grabbed two trays of mail, and ran away. The employee yelled for help and several other postal employees chased Smith down the street. When the first employee caught up to Smith, Smith dropped the trays of mail, reached into his waistband, and said “I have a gun, I’m going to shoot you.”
As two other employees caught up, Smith turn around and punched one of the employees in the face, below their left eye, and before falling to the ground. The employees took pictures of Smith, collected the stolen mail, and returned to the post office. Smith was later identified and arrested without incident.
On June 22, 2022, a federal grand jury in Portland returned a two-count indictment charging Smith with mail theft and assault on a federal officer. On November 28, 2022, he pleaded guilty to the assault charge.
This case was investigated by the U.S. Postal Inspection Service (USPIS). It was prosecuted by Meredith D.M. Bateman and Seth Uram, Assistant U.S. Attorneys for the District of Oregon.
Physician Agrees to $190,731 Settlement Relating to Controlled Substances Act ClaimsRead the Press Release
PENSACOLA, FLORIDA – Timothy Ramsden, of Panama City, Florida, practicing at The Anti-Aging Clinic of Northwest Florida, settled potential violations of the Controlled Substances Act by agreeing to pay a fine of $190,731 and surrendering his Drug Enforcement Administration (DEA) registration for Schedule II and IIN controlled substances for a period of five (5) years, along with compliance monitoring for a period of five (5) years. The settlement was announced by Jason R. Coody, United States Attorney for the Northern District of Florida.
“In reaching this settlement, we emphasize the necessity of adhering to and enforcing the Controlled Substances Act,” said U.S. Attorney Coody. “It is our duty to ensure the mandates of the Controlled Substances Act are upheld and that its limits are not abused by physicians. Our office will continue to ensure compliance with the Controlled Substances Act and all federal laws regulating physicians.”
Dr. Ramsden entered into a civil settlement agreement with the United States Attorney’s Office for the Northern District of Florida. As part of the resolution, Dr. Ramsden will surrender his DEA registration for Schedule II and IIN controlled substances, not reapply for a period of at least five years, and pay a civil fine of $190,731. The investigation uncovered numerous potential civil violations of the Controlled Substances Act, including:
- Failing to keep complete and accurate records;
- Failing to properly document the biennial inventory;
- Failing to record the number of units or volume of each finished form in each commercial container on the biennial inventory;
- Failing to indicate the date received on two (2) invoices;
- Failing to properly indicate the dispositions within the patient file;
- Failing to document patient file where prescription for Testosterone Enanthate (5ML) Injectable was issued;
- Issuing prescription for Oxandrolone to patient which was returned to Dr. Ramsden for his personal use.
In addition to the monetary penalties and surrender of his DEA Schedule II and IIN registration, Dr. Ramsden agreed to compliance terms for the next five (5) years, including record-keeping monitoring and uninterrupted visits from the DEA.
“An important part of DEA’s mission is to ensure all DEA registrants follow the federal laws set forth in the Controlled Substance Act, to include accurate inventorying, tracking, and recordkeeping to prevent the diversion of controlled substances. When medical professionals fail to comply with these laws, it puts our communities at risk,” said DEA Miami Field Division Special Agent in Charge Deanne L. Reuter. “DEA remains committed to working with our law enforcement and regulatory partners to hold registrants accountable and ensure our communities remain safe and healthy.”
This civil settlement agreement is not an admission of any liability by Dr. Ramsden, nor a concession by the United States that its potential claims were not well-founded.
Assistant United States Attorneys Mary Ann Couch, Kathryn Drey, and Marie Moyle represented the United States in this matter, which was investigated by the Drug Enforcement Administration, Diversion Control Program.
The U.S. Attorney’s Office for the Northern District of Florida is one of 94 offices that serve as the nation’s principal litigators under the direction of the Attorney General. To access public court documents online, please visit the U.S. District Court for the Northern District of Florida website. For more information about the U.S. Attorney’s Office, Northern District of Florida, visit http://www.justice.gov/usao/fln/index.html.
Omaha Man Sentenced for Possession of a Firearm by a FelonRead the Press Release
United States Attorney Steven Russell announced that Thomas Costanza, 52, of Omaha, Nebraska, was sentenced today in federal court in Omaha for possession of a firearm by a felon. United States District Judge Brian C. Buescher sentenced Costanza to 30 months’ imprisonment followed by 3 years of supervised release for that offense. There is no parole in the federal system.
On August 4, 2020, Costanza sold a Colt Government Model .45 caliber handgun to Sol’s Jewelry and Loan in Omaha. During the transaction, Costanza provided his driver’s license, and Sol’s photocopied it. Costanza also provided a fingerprint and took a photograph. The sale was recorded on a sales ticket. Surveillance video from Sol’s showed Costanza enter the store with a brown bag, present it to the front counter, and remove the firearm. Costanza was subsequently arrested and admitted to law enforcement that he sold the firearm to Sol’s. That firearm was later determined to have been reported stolen. On August 4, 2020, Costanza had a prior felony conviction for Theft by Shoplifting-Third Offense in Douglas County District Court, and he was therefore prohibited from possessing a firearm.
This case was part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally based strategies to reduce violent crime.
This case was investigated by the Omaha Police Department.
Omaha Man Sentenced for Firearm OffenseRead the Press Release
COUNCIL BLUFFS, IA – Diamond Cook, age 31, of Omaha, Nebraska, was sentenced on February 16, 2023, to 48 months in prison following his plea of guilty to being a prohibited person in possession of a firearm. After he is released from prison, Cook will serve three years of supervised release.
On February 24, 2022, a Fremont County Deputy stopped a car on Interstate 29 for not displaying registration and a nonworking brake light. The deputy could smell marijuana coming from the car. Cook was a passenger and lied about his name. During a search of the car, law enforcement located a loaded handgun. Cook is prohibited from having any firearms because he is a convicted felon.
United States Attorney Richard D. Westphal of the Southern District of Iowa made the announcement. The Fremont Cunty Sheriff’s Office, the Federal Bureau of Investigation and the Bureau of Alcohol, Tobacco, Firearms and Explosives investigated the case.
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. In May 2021, the Department of Justice 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.
Old Saybrook Contractor Sentenced to Prison for Tax EvasionRead the Press Release
Vanessa Roberts Avery, United States Attorney for the District of Connecticut, announced that DIMITRIOS KASSIMIS, also known as Jimmy Kassimis, 58, of Old Saybrook, was sentenced today by U.S. District Judge Omar A. Williams in Hartford to 15 months of imprisonment, followed by three years of supervised release, for tax evasion.
According to court documents and statements made in court, Kassimis owns and operates various entities related to his construction business, including Allstate Contracting and JRC Renovations. In 2018 and 2021, Kassimis received substantial income from his businesses but did not file any personal or business federal income tax returns, and also did not file any employment tax returns for his businesses. The investigation revealed that Kassimis did not have any personal bank accounts. He paid all of his personal expenses through his business bank accounts and made cash withdrawals from the business accounts at casinos for personal expenses. He also cashed checks made payable to his businesses at a check cashing business in New York and failed to report that income. In addition, he did not issue IRS Forms 1099 or W-2 to his employees and paid at least some employees in cash.
The tax loss to the IRS for the 2018 through 2021 tax years was $233,086.87. Judge Williams ordered Kassimis to cooperate with the IRS to pay all outstanding tax liabilities.
On November 9, 2022, Kassimis pleaded guilty to one count of tax evasion.
Kassimis, who is released on bond, is required to report to prison on April 24.
This investigation was conducted by the Internal Revenue Service, Criminal Investigation Division. The case was prosecuted by Assistant U.S. Attorney David T. Huang.
Ocean County Man Admits Sexually Exploiting MinorRead the Press Release
TRENTON, N.J. – An Ocean County, New Jersey, man today admitted coercing a minor into producing images of child sexual abuse, U.S Attorney Philip R. Sellinger announced.
Samuel Schwinger, 37, Lakewood, New Jersey, pleaded guilty before U.S. District Court Judge Georgette Castner in Trenton federal court to an information charging him with one count of sexual exploitation of a minor.
According to documents filed in the case and statements made in court:
In March 2019 used an internet-based application to communicate with the victim, who was under the age of 12. Schwinger asked the victim to make sexually explicit videos of the victim and send them to him. Schwinger admitted that from October 2018 through April 5, 2019, he communicated with more than 25 minor victims for the purpose of producing and distributing sexually explicit material.
The charge of sexual exploitation of a minor carries a mandatory minimum penalty of 15 years in prison, a maximum potential penalty of 30 years in prison and a $250,000 fine. Sentencing is scheduled for June 27, 2023.
U.S. Sellinger credited special agents of the Department of Homeland Security, Homeland Security Investigations, Cherry Hill under the direction of Special Agent in Charge Ricky J. Patel in Newark; the Ocean County Prosecutor’s Office, under the direction of Prosecutor Bradley D. Billhimer; and the Lakewood New Jersey Police Department under the direction of Chief Gregory Meyer.
The government is represented by Assistant U.S. Attorney Michelle Gasparian, Chief of the General Crimes Unit.
North Platte Woman Sentenced for Drug Trafficking CrimeRead the Press Release
United States Attorney Steven Russell announced that Catherine Gibson, 45, of North Platte, Nebraska, was sentenced today in federal court in Omaha, Nebraska, for her role in a methamphetamine conspiracy. United States District Judge Brian C. Buescher sentenced Gibson to 46 months of imprisonment. There is no parole in the federal system. After her release from prison, she will begin a three-year term of supervised release.
In February and March of 2021, Gibson was part of a conspiracy to distribute methamphetamine in western Nebraska. As part of the conspiracy, on both February 22, 2021, and February 23, 2021, Gibson sold approximately 28 grams of methamphetamine to an informant. On March 3, 2021, law enforcement searched Gibson’s rental car and located approximately 110 grams of methamphetamine (actual) and ten fentanyl pills. On the same day, officers searched Gibson’s Alliance, Nebraska, residence and located an additional approximately 92 grams of methamphetamine. Gibson told officers that she picked up methamphetamine and was bringing it to Alliance, Nebraska, to sell.
This case was investigated by the Nebraska State Patrol, the Box Butte County Sheriff’s Office, and the Federal Bureau of Investigation.
Nigerian Man Sentenced to Five Years in Prison for Multimillion Dollar Fraud Scheme in Which He Impersonated Procurement Officials of U.S. State and Local Governments and Educational InstitutionsRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, announced today that FATADE IDOWU OLAMILEKAN, a/k/a “Fatade Olamilekan Idowu,” a/k/a “Olamilekan Idowu Fatade,” a/k/a “Idowu Fatade,” a citizen of Nigeria, was sentenced to five years in prison in connection with a scheme to fraudulently obtain and attempt to obtain millions of dollars of medical equipment, laboratory products, computer equipment and hardware, and other merchandise from suppliers of such merchandise across the United States by impersonating, among other individuals, procurement officials of U.S. state and local governments and educational institutions. OLAMILEKAN was arrested in Nigeria on October 1, 2021, and extradited from Nigeria to the United States on July 14, 2022, and he has been detained since his arrest. The defendant previously pled guilty to wire fraud before U.S. District Judge Valerie E. Caproni, who imposed today’s sentence.
U.S. Attorney Damian Williams said: “Fatade Idowu Olamilekan carried out a sprawling criminal scheme from Nigeria to fraudulently obtain medical equipment and other merchandise by impersonating government officials, including the Chief Procurement Officer for New York. Olamilekan will now face substantial prison time for his criminal conduct. This case demonstrates that we will go to great lengths to pursue defendants located abroad who seek to defraud American businesses and individuals.”
According to the allegations in the Indictment and other court documents:
From at least in or about 2018 through at least on or about September 14, 2020, OLAMILEKAN engaged in a scheme to fraudulently obtain and attempt to obtain millions of dollars of medical equipment, laboratory products, computer equipment and hardware, and other merchandise from suppliers of such merchandise across the United States by impersonating, among other individuals, procurement officials of U.S. state and local governments and educational institutions. In particular, during the COVID-19 pandemic, OLAMILEKAN impersonated the Chief Procurement Officer of New York State in an effort to fraudulently obtain medical equipment, including defibrillators. OLAMILEKAN engaged in the following conduct to carry out his criminal scheme:
First, OLAMILEKAN engaged in extensive research to identify specific procurement officials of U.S. state and local governments and educational institutions to impersonate and U.S. suppliers of medical, laboratory, and computer equipment to target as part of the scheme. This research included obtaining information about the current suppliers to the state and local governments and educational institutions OLAMILEKAN sought to impersonate and targeting those suppliers in order to avoid arousing suspicion. For example, OLAMILEKAN appears to have specifically targeted a medical supplier that was already providing medical equipment to New York State in or to avoid suspicion when OLAMILEKAN, who was impersonating the Chief Procurement Officer of New York State, contacted the supplier to obtain medical equipment.
Second, after OLAMILEKAN identified procurement officials to impersonate, he used aliases and a Lithuanian web hosting company to register email accounts with domains that had slight variations from the legitimate email accounts used by procurement officials in order to “spoof” or impersonate those officials’ email accounts (the “spoofed emailed accounts”). The spoofed email accounts used by OLAMILEKAN usually had the same username as the procurement official’s email account but added an extra letter or common domain name to the domain of the email account. These spoofed email accounts were therefore specifically designed to trick suppliers to impersonated procurement officials into thinking the spoofed email accounts were authentic. In total, OLAMILEKAN registered and used spoofed email accounts impersonating at least (i) eight different procurement officials of state and local governments in California, Illinois, Minnesota, New York, North Carolina, Pennsylvania, Texas, and Vermont; and (ii) three procurement officials of educational institutions located in Georgia and New York.
Third, OLAMILEKAN used the spoofed email accounts to send emails impersonating the procurement official and seeking quotes for medical, laboratory, and computer equipment from targeted suppliers. These emails typically indicated that the payment terms would be “net 30 days,” which is a standard term of trade credit for government and educational entities that only requires payment for the goods within 30 days of delivery. OLAMILEKAN therefore impersonated the identities of procurement officials of government entities and educational institutions in order to exploit this industry standard and fraudulently obtain equipment without providing any advance payment information or deposit prior to delivery of the equipment.
Finally, once OLAMILEKAN received a response from a targeted supplier, he provided the supplier with a purchase order containing the forged signature of the impersonated procurement official and an address for a warehouse located in the United States for delivery and storage of the equipment purchased. Once the purchased items shipped to the warehouse provided by OLAMILEKAN, he typically had the warehouse re-ship the items to another warehouse and, ultimately, from the United States to locations in Australia, the United Kingdom, and/or Nigeria. OLAMILEKAN also coordinated with the warehouses receiving the shipments from the targeted suppliers using the stolen identity of at least one U.S. resident, thereby further concealing his own identity and avoiding detection of his criminal activity. Because payment was not due to the suppliers until 30 days after delivery of the equipment, OLAMILEKAN was able to take possession of the equipment prior to detection of the fraud, which typically occurred after payment was not received by the supplier within the 30-day period.
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In addition to the prison sentence, OLAMILEKAN, 41, of Lagos, Nigeria, was sentenced to three years of supervised release and ordered to pay restitution and forfeiture of $306,852.18.
Mr. Williams praised the investigative work of the Federal Bureau of Investigation. Mr. Williams also thanked Nigeria’s Federal Ministry of Justice, Nigeria’s Economic and Financial Crimes Commission (“EFCC”), the Central Authority Unit of Nigeria’s Ministry of Justice, and the Attorney General of the Federal Republic of Nigeria for their assistance in the investigation. The U.S. Department of Justice’s Office of International Affairs of the Department’s Criminal Division provided significant assistance in securing the defendant’s extradition from Nigeria.
This case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorney Sagar K. Ravi is in charge of the prosecution.
New York Man Is Charged with Cyberstalking, Kidnapping, and Related OffensesRead the Press Release
CHARLOTTE, N.C. – A federal grand jury in Charlotte returned a criminal indictment charging Russell J. Martini, 45, of Bay Shore, New York, with cyberstalking, stalking, kidnapping, and making interstate threats, announced Dena J. King, U.S. Attorney for the Western District of North Carolina.
Michael C. Scherck, Acting Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, and Chief Johnny Jennings of the Charlotte Mecklenburg Police Department join U.S. Attorney King in making today’s announcement.
According to allegations in the indictment, from April to May 2022, Martini sent repeated harassing and threatening communications to an individual identified in court documents as “Jane Doe.” The indictment alleges that Jane Doe knew Martini and had obtained a protection order in New York that prohibited the defendant from contacting her. In April 2022, Jane Doe moved from New York to Charlotte. Soon thereafter, Martini allegedly began a cyberstalking campaign against Jane Doe, and used texts, emails and social media platforms to send Jane Doe and members of her family harassing messages and threats of death and bodily injury. Martini also allegedly created a public social media account in Jane Doe’s name and used a compromising photo of the victim as a profile picture. The indictment further alleges that Martini threatened to publish sexual photos and videos of Jane Doe online and on popular social media websites if Jane Doe did not respond to Martini’s communications.
According to the indictment, in May 2022, Martini traveled to Charlotte and attempted to kidnap Jane Doe. The indictment alleges that Martini waited at Jane Doe’s apartment complex and attacked her as she walked up the stairs to her apartment. Martini allegedly attempted to drag the victim to his car but a bystander intervened and Martini fled. After the attack, Martini allegedly sent Jane Doe an email asking her if she was “ready for round two” and threatened to kill her.
Martini is currently in state custody and will be scheduled to appear in federal court. He faces a maximum penalty of up to life in prison for the kidnapping charge, and a maximum prison term of five years for each offense of cyberstalking, stalking, and communicating interstate threats.
The charges against Martini are allegations. The defendant is innocent until proven guilty beyond reasonable doubt in a court of law.
In making today’s announcement, U.S. Attorney King thanked the FBI and CMPD for their investigation of this case.
Assistant United States Attorney Kimlani Ford of the U.S. Attorney’s Office in Charlotte is prosecuting the case.
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New Orleans Resident Pleads Guilty to Drug ConspiracyRead the Press Release
NEW ORLEANS, LA – United States Attorney Duane A. Evans announced that TONI JONES, age 33, of New Orleans, Louisiana, pleaded guilty on February 16, 2023 to a violation of the Federal Drug Control Act, Title 21, United States Code, Sections 841(a)(1) and 841(b)(1)(C).
JONES’s federal conviction is for possession with the intent to distribute fentanyl, cocaine base, and methamphetamine. The offense occurred on February 10, 2022 at the intersection of North Claiborne Avenue and Tupelo Street in New Orleans, Louisiana. She faces a maximum of twenty (20) years imprisonment, a fine of up to $1,000,000.00, at least three (3) years of supervised release, and a mandatory $100.00 special assessment fee.
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.
The case was investigated by the Federal Bureau of Investigation. It is being prosecuted by Assistant U.S. Attorney Charles Dustin Strauss of the Violent Crimes Unit.
Navajo man pleads guilty to sexual abuse of a minorRead the Press Release
ALBUQUERQUE, N.M. – Alexander M.M. Uballez, United States Attorney for the District of New Mexico, announced today that Christian Apachito pleaded guilty to sexual abuse of a minor on Feb. 15, 2023. Apachito, 28, of Tohajiilee, New Mexico, and an enrolled member of the Navajo Nation, will remain in custody pending sentencing, which has not yet been scheduled.
In his plea agreement, Apachito admitted that on or about November 11, 2020, he engaged in a sexual act with the victim, identified as Jane Doe. The victim is also a member of the Navajo Nation and was at least the age of 12 years but not yet 16 years old at the time. The abuse took place on the Navajo Nation.
By the terms of the plea agreement, Apachito faces not more than 15 years in prison and must register as a sex offender.
This case was investigated by the FBI Albuquerque Field Office with assistance from the Navajo Department of Criminal Investigation. Assistant United States Attorneys Kimberly N. Bell and Mark Pfizenmayer are prosecuting the case.
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Mother-Daughter Fraudsters Sentenced for Social Security and Bankruptcy ScamsRead the Press Release
LYNCHBURG, Va. – A Hurt, Virginia woman, who stole more than $170,000 in Social Security Administration retirement funds to which she was not entitled, was sentenced in federal court just three months after her mother was sentenced on related charges.
In November 2022, Christy Bowling, 38, pled guilty to concealment of bankruptcy assets and theft of government money. Last week, she was sentenced to two months in federal prison and one year of home detention.
Bowling’s mother, Judith Cash, 58, of Shipman, Virginia, pleaded guilty in May 2022 to one count of theft of public money and was sentenced to one year of home detention.
According to court documents, in August 2020, Betty Gowen, who had been incarcerated since 2011 for the murder of her husband, contacted the Social Security Administration (SSA) to apply for Title II Retirement Insurance Benefits upon her release from prison.
When SSA officials received Gowen’s application, it was revealed that her daughter, Judith Cash, and granddaughter, Christy Bowling, had already applied for and had been receiving Gowen’s SSA Retirement Benefits since 2010. Cash and Bowling had been using the funds through a shared bankcard.
SSA determined that Cash and Bowling stole $172,952 and the court has ordered them to pay this amount back in restitution.
United States Attorney Christopher R. Kavanaugh of the Western District of Virginia and Gail S. Ennis, Inspector General for the Social Security Administration, made the announcement.
The Social Security Administration investigated the case.
Assistant U.S. Attorney Charlene R. Day prosecuted the case.
Milton Man Pleads Guilty to Federal Child Sex Crimes Committed in FijiRead the Press Release
PENSACOLA, FLORIDA – Jason R. Moore, 42, of Milton, Florida, has pled guilty to two counts of “Illicit Sexual Conduct in Foreign Places.” Jason R. Coody, United States Attorney for the Northern District of Florida, announced the plea today after Moore admitted his criminal activity in federal court in Pensacola.
The federal indictment alleged that Moore engaged in “Illicit Sexual Conduct in Foreign Places” from March 2013 through February 2016. Specifically, Moore engaged in these crimes in the Republic of Fiji. Moore was arrested by Special Agents from the Department of Homeland Security and the Florida Department of Law Enforcement in Santa Rosa County in late 2022.
Moore remains in the custody of the United States Marshals Service. Sentencing is scheduled for May 22, 2023, at 11:00 a.m., before United States District Judge M. Casey Rodgers. Moore faces up to 60 years in federal prison, followed by a term of up to a lifetime of supervised release following any imprisonment. Moore will also have to register as a sexual offender.
The case was investigated by the Department of Homeland Security, the Florida Department of Law Enforcement, and the New York State Police.
The case is being prosecuted by Assistant United States Attorney David L. Goldberg and Trial Attorney Adam Braskich of the Department of Justice’s Child Exploitation and Obscenity Section.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse. Launched in May 2006 by the Department of Justice and led by the U.S. Attorney’s Offices and the Criminal Divisions Child Exploitation and Obscenity Section (CEOS), it 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.projectsafechildhood.gov.
The United States Attorney's Office for the Northern District of Florida is one of 94 offices that serve as the nation’s principal litigators under the direction of the Attorney General. To access public court documents online, please visit the U.S. District Court for the Northern District of Florida website. For more information about the United States Attorney’s Office, Northern District of Florida, visit http://www.justice.gov/usao/fln/index.html.
Michigan Doctor Sentenced to Prison for Tax EvasionRead the Press Release
A Michigan endocrinologist was sentenced yesterday to eight months in prison for evading taxes due on income related to his medical practice.
According to court documents and statements made in court, Dr. Bashar Kiami of Roscommon owned and operated Northern Michigan Endocrine PLLC, a solo endocrinology practice in Grayling. From 2014 through 2017, Kiami filed corporate returns that underreported the practice’s gross receipts and overstated its expenses. As the sole shareholder, Kiami reported business income from the practice on his individual income tax returns. By underreporting the practice’s business income, Kiami fraudulently reduced his personal tax liability for those same years. In total, Kiami caused a tax loss to the IRS of approximately $250,000.
In addition to the term of imprisonment, U.S. District Judge Thomas L. Ludington ordered Kiami to serve two years of supervised release, pay a $15,000 fine and pay the remaining $59,642 he owed in restitution to the U.S.
Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division made the announcement.
IRS-Criminal Investigation investigated the case.
Trial Attorneys Jeffrey A. McLellan and Melissa S. Siskind of the Justice Department’s Tax Division prosecuted the case.
Medical Center pays over $21M to settle alleged false claimsRead the Press Release
HOUSTON – Cornerstone Healthcare Group Holding Inc. and CHG Hospital Medical Center LLC. dba Cornerstone Hospital Medical Center have agreed to pay the United States $21,637,512 to resolve claims that the company improperly billed Medicare, announced U.S. Attorney Alamdar S. Hamdani.
Some of the alleged claims were submitted for unauthorized services, services not provided and services which were deemed so inadequate they were considered worthless.
“Taking advantage of the elderly and infirm is disgraceful,” said Hamdani. “When providers accept federal funds for reimbursement, they have a duty and responsibility to provide the necessary and best care possible to the patient. As one of the largest of its kind in our district, this settlement shows our commitment to protecting our most vulnerable citizens and the integrity of the Medicare system.”
Cornerstone Medical Center was formerly a long-term acute care facility located in Houston that operated as a long-term care hospital. Cornerstone was in the business of providing extended medical and rehabilitative care to individuals who qualified as clinically complex and possessed multiple acute and/or chronic conditions. Through its subsidiaries, CHG Holding operated specialty hospitals throughout the United States, including Cornerstone Medical Center which is no longer in business.
The investigation began when a qui tam aka whistleblower lawsuit was filed under seal Sept. 28, 2018. The individual filing the suit worked at Cornerstone Medical Center long term care facility. During the relator’s employment, they witnessed, among other things, unlicensed, unauthorized students of Drs. Jorge Guerrero, Joel Joselevitz and Joseph Varon rendering medical procedures. These unauthorized and improper services were fraudulently billed to Medicare.
In addition, Cornerstone Medical Center submitted claims for payment for services certain treating physicians allegedly rendered. However, records showed those physicians were actually out of the country and could not have performed the services.
Finally, the investigation concluded that from Jan. 1, 2012, through Dec. 31, 2018, Cornerstone Medical Center billed for services not supported by the patients’ diagnosis or medical records, and billed for services that were either not rendered or were so inadequate they were worthless (in some cases, resulting in harm to patients.) The claims for payment to Medicare for those services were deemed to be fraudulent and submitted in violation of federal law.
“Submitting improper claims to Medicare compromises the financial security of the program and wastes valuable taxpayer dollars,” said Acting Special Agent in Charge Korby R. Harshaw of Department of Health and Human Services - Office of Inspector General (DHHS-OIG). “We will continue to work alongside our law enforcement partners to protect the integrity of federal health care programs and to hold bad actors who exploit them accountable.”
“This $21.6 million settlement by Cornerstone Healthcare Group Holding is one of the largest civil healthcare fraud settlements FBI Houston has seen, and we work a lot of healthcare fraud cases. I hope this case sends a message to other healthcare providers who think they can get away with similar fraud,” said FBI Special Agent in Charge James Smith. “Not only did Cornerstone Healthcare bilk the Medicare program out of millions of dollars, it also took advantage of its patients who were unknowingly used for its scam. These patients trusted their doctors and healthcare providers and ultimately received little to no care. At the end of the day, health care fraud affects everyone. It raises our health insurance premiums and exposes patients to worthless and unnecessary medical procedures. I’m proud of the work our FBI Houston Healthcare Fraud Task Force has done.”
Under the False Claims Act, a private party known as a relator can file an action on behalf of the United States and receive a portion of the recovery. In this case, the relator will receive $4,327,502.
The U.S. Attorney’s Office, DHHS-OIG, FBI and Department of Defense conducted the investigation.
The claims resolved by the settlement are allegations only, and there has been no determination of liability.
Man charged with domestic assault in Indian CountryRead the Press Release
ALBUQUERQUE, N.M. – Alexander M.M. Uballez, United States Attorney for the District of New Mexico, announced today that Steven Williams was charged by complaint with assault with a deadly weapon and assault by strangulation. Williams, 28, of the Caddo Nation of Oklahoma, appeared in federal court today for a detention hearing and will remain in custody pending trial, which has not yet been scheduled.
According to the criminal complaint, over the course of three days in February, Williams allegedly beat his pregnant girlfriend, identified in court records as Jane Doe, so badly she needed immediate medical care at San Juan Regional Medical Center. Jane Doe’s injuries included a broken hand, severe bruising, and knife wounds to her neck, arms, and hands.
A complaint is only an allegation. A defendant is presumed innocent unless and until proven guilty. If convicted, Williams faces up to twenty years in prison.
The FBI Albuquerque Field Office investigated this case with assistance from the Jicarilla Apache Police Department. Special Assistant United States Attorney Mark A. Probasco is prosecuting the case.
Anyone experiencing domestic violence or who knows someone experiencing domestic violence can reach an advocate at the National Domestic Violence Hotline at 1-800-799-SAFE (7233) or 1-800-787-3224 (TTY). In New Mexico, the Domestic Violence Resource Center is available by telephone at (505) 843-9123 or online at https://dvrcnm.org/
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Man Sentenced to 10 Years in Federal Prison for Fentanyl and Firearm OffensesRead the Press Release
GREENSBORO, N.C. - On February 22, 2023, a judge in federal district court sentenced CLYDE TURAINE BRAND to 120 months in prison, announced United States Attorney Sandra J. Hairston of the Middle District of North Carolina.
On September 20, 2022, following a five-day trial, a jury found BRAND, age 38, guilty of three counts: felon in possession of a firearm, possession of a stolen firearm, and possession with intent to distribute fentanyl.
Evidence at trial showed that on June 30, 2021, BRAND possessed with intent to distribute 2.55 grams of fentanyl, a rifle, and two stolen Smith & Wesson handguns at a residence in Concord, North Carolina, following the execution of a search warrant. BRAND was present at the residence at the time the warrant was executed. The fentanyl was recovered from a toilet. The rifle was found in the closet of an empty bedroom. The stolen handguns were found in a vehicle behind the residence.
United States District Chief Judge Thomas D. Schroeder sentenced BRAND to a 120-month term of imprisonment and a 3-year term of federal supervised release.
The case was investigated by Bureau of Alcohol Tobacco Firearms and Explosives (ATF), Cabarrus County Sheriff's Office, and the Department of Homeland Security. The case was prosecuted by Assistant United States Attorney Craig M. Principe and Special Assistant United States Attorney Mary Ann Courtney.
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.
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Man Pleads Guilty for Sexually Assaulting a 14-Year-Old and Strangling a Dating PartnerRead the Press Release
A man who sexually abused a 14-year-old victim and later assaulted his then-girlfriend has pleaded guilty in federal court, announced U.S. Attorney Clint Johnson.
Andrew Don Rector, 32, of Kiefer, pleaded guilty to sexual abuse of a minor in Indian Country and assault of an intimate/dating partner by strangling and attempting to strangle in Indian Country.
In his plea agreement, Rector admitted that on Aug. 15, 2020, to Aug. 16, 2020, he sexually abused a 14-year-old victim while she was at his home. Officers dispatched to locate the teenager, who was reported as a runaway, discovered the victim in the defendant’s home. Law enforcement were able to prove the sexual assault after interviewing the victim and analyzing DNA evidence.
Rector further admitted that from May 3, 2022, to May 4, 2022, he strangled his dating partner. During the domestic violence assault, he strangled the victim multiple times and also threatened to kill the victim and her family.
The FBI and Muscogee Nation Lighthorse Tribal Police Department conducted the investigation. Assistant U.S. Attorneys Julie Childress and Cymetra Williams are prosecuting the case.
Man Extradited from Peru on International Money Laundering ChargesRead the Press Release
ALEXANDRIA, Va. – A Belize City, Belize, man was extradited to the United States Tuesday on charges of laundering tens of millions of dollars of drug proceeds on behalf of notorious international drug trafficking organizations.
According to court documents, Jianxing Chen, 42, led and controlled a network of couriers who transported cash generated by the domestic sale of controlled substances. Some of the cash came from cocaine sales throughout the United States – including Chicago, Houston, Los Angeles, New York, Atlanta, as well as in the Eastern District of Virginia. At Chen’s direction, couriers transported drug money across the country to locations in New York City. From there it was laundered through a variety of methods until it, or its equivalent value, was remitted to drug trafficking organizations in Latin America, including Mexico. Chen received “contracts” to transport and launder this money through Xizhi Li, who was also prosecuted and convicted based on the same superseding indictment.
Below is a table of defendants also named in the superseding indictment along with their sentences:
Name
Charges
Conviction/Sentence
Xizhi Li
Counts 1-3 (drug trafficking and money laundering
Money laundering, 180 months
Jiayu Chen
Counts 1-3 (drug trafficking and money laundering
Money laundering, 60 months
Eric Yong Woo
Count 3 (money laundering)
Money laundering, 18 months
Jingyuan Li
Counts 1-3 (drug trafficking and money laundering)
Money laundering, 84 months
Tao Liu
Counts 1-14 (drug trafficking, money laundering, attempted identity fraud, bribery
Money laundering, bribery, 84 months
Chen was arrested in Lima, Peru, on June 14, 2021, based on the superseding indictment and held in that country until his extradition was approved and executed on February 21, 2023.
Chen is charged with conspiracy to distribute five kilograms or more of cocaine, conspiracy to distribute five kilograms or more of cocaine, knowing and intending and having reasonable cause to believe it will be unlawfully imported into the United States, and conspiracy to commit money laundering. If convicted, Chen faces a mandatory minimum of 10 years in prison and up to life imprisonment. 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; Wendy C. Woolcock, Special Agent in Charge for the Drug Enforcement Administration’s (DEA) Special Operations Division; J. Todd Scott, Special Agent in Charge for the DEA-Louisville; Frank. A. Tarentino III , Special Agent in Charge for the DEA-New York; Jessica Moore, Chief of the Criminal Investigations Division of the U.S. Department of State’s Diplomatic Security Service (DSS); and James M. Gibbons, Special Agent in Charge of U.S. Homeland Security Investigations (HSI), made the announcement.
Assistant U.S. Attorneys David A. Peters and Michael P. Ben’Ary, along with Trial Attorneys Mary Daly, and Stephen A. Sola of the Justice Department’s Money Laundering and Asset Recovery Section, are prosecuting the case.
Significant assistance was provided by law enforcement partners in Australia, Guatemala, Mexico, and New Zealand.
The case was investigated as part of two Organized Crime Drug Enforcement Task Forces (OCDETF), Operation Dark Castle and Operation Taishan Triangle. The OCDETF program is a federal multi-agency, multi-jurisdictional task force that supplies supplemental federal funding to federal and state agencies involved in the identification, investigation, and prosecution of major drug trafficking organizations. The principal mission of the OCDETF program is to identify, disrupt, and dismantle the most serious drug trafficking, weapons trafficking, and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.
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. 1:19-cr-334.
An indictment is merely an accusation. The defendant is presumed innocent until proven guilty.
Man Convicted of Distributing Methamphetamine Sentenced to Federal PrisonRead the Press Release
SHREVEPORT, La. - United States Attorney Brandon B. Brown announced that Ronnie K. Hongo, Jr., 43, of Many, Louisiana, has been sentenced by United States District Judge S. Maurice Hicks, Jr. to 180 months in prison, followed by 5 years of supervised release, on drug and firearms charges.
According to evidence presented to the court, on or about March 19, 2021, the Sabine Parish Sheriff’s Office executed a search warrant at a residence in Many, Louisiana where Hongo lived. Law enforcement agents with the Federal Bureau of Investigation (FBI) and Sabine Parish Sheriff’s Office had information that Hongo had been selling methamphetamine to others. During the execution of the search warrant, deputies discovered 369 grams of methamphetamine and a .45 caliber pistol inside the home. Hongo was present at the home at the time of the search, and he was subsequently arrested. Following his arrest, Hongo confessed to possession of the narcotics and firearm. Additional investigation by agents with the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) revealed that the firearm had traveled in interstate commerce and functioned as designed. Hongo pleaded guilty on October 5, 2022 to one count of possession with intent to distribute methamphetamine and one count of carrying and using a firearm during a drug trafficking crime.
The case was investigated by the FBI, ATF, and Sabine Parish Sheriff’s Office and prosecuted by Assistant U.S. Attorney Leon H. Whitten.
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Lebanon Man Gets 200 Months in Federal Prison for Meth DistributionRead the Press Release
EAST ST. LOUIS – A U.S. District Court judge sentenced a Lebanon man on Tuesday to more than 16 years in federal prison for his involvement in distributing methamphetamine in St. Clair County.
Michael P. O’Leary, 48, pled guilty to one count of methamphetamine distribution, one count of possession with intent to distribute methamphetamine and one count of felon in possession of a firearm. In addition to his prison sentence, he received five years of supervised release.
“The defendant was responsible for distributing large amounts of methamphetamine throughout the Metro East,” said U.S. Attorney Rachelle Aud Crowe. “Illegal, dangerous drugs have no place in downstate Illinois communities, and the U.S. Attorney Office will continue to work with the DEA to remove individuals responsible for infecting families and loved ones.”
“Drug traffickers engage in their illicit activities for a specific reason: to make money,” said Assistant Special Agent in Charge Sean Vickers, head of Drug Enforcement Administration operations in southern Illinois. “Unfortunately, some of them use firearms to commit their criminal acts. This 16-year sentence demonstrates that DEA and its local and federal partners are dedicated to taking illegally possessed firearms off the street and putting these criminals out of business.”
According to court documents, an undercover DEA agent purchased 55 grams of methamphetamine from O’Leary in December 2020. In January 2021, the DEA executed a search warrant of his Lebanon residence and recovered 467 grams of methamphetamine.
During the search, DEA agents also located a handgun in O’Leary’s closet and was informed he owned several other firearms. The defendant is a convicted felon from a methamphetamine distribution charge in March 2015 and thus unable to legally possess firearms.
DEA led the investigation, and Assistant U.S. Attorney Dan Carraway prosecuted the case.
Leader of Violent Lansing Street Gang Sentenced to 12 Years in Federal Prison for Illegally Possessing A FirearmRead the Press Release
GRAND RAPIDS, MICHIGAN — U.S. Attorney Mark Totten announced that yesterday Michael Anthony Granado, 32, of Lansing, Michigan was sentenced to 12 years in federal prison for being a felon in possession of a firearm. U.S. District Judge Paul L. Maloney also ordered Granado to spend three years on supervised release after his confinement. Granado was a founding member and high-level leader of the Lansing area gang known as “Shake Da Bag,” commonly referred to as “SDB.” Information received by the U.S. Attorney’s Office indicates that SDB is a violent criminal enterprise whose members and associates have been involved in numerous criminal activities in the Lansing area, including armed robberies, assaults, shootings, narcotics trafficking, firearms trafficking, and other illegal firearm offenses. On September 9, 2022, investigators executed a federal search warrant at Granado’s residence and located a loaded Glock Model 21 .45 caliber pistol in his bedroom.
Granado pictured with additional firearms and SDB necklace
“We will continue to bring the full force of the law down on violent individuals and criminal enterprises that spread havoc and fear in our neighborhoods,” said U.S. Attorney Mark Totten. “My office is committed to disrupting illegal firearm and drug trafficking that hurt our communities. Violent street gangs and illegal firearm possession have no place in our district.”
The U.S. Attorney’s Office, working closely with investigative teams at the Lansing Police Department’s Violent Crime Initiative (VCI), the Michigan State Police, and the Bureau of Alcohol, Tobacco, and Firearms (ATF) have identified and prosecuted several members and associates of the SDB street gang to disrupt the cycle of violence in Lansing. In addition to Granado, the following leaders, members, and suppliers of firearms to the SDB street gang have been sentenced in the U.S. District Court for the Western District of Michigan in the past year:
Marquies Deshaun Davis: Sentenced in March 2022 to ten years for possession with intent to distribute controlled substances and possession of a firearm in furtherance of a drug trafficking crime.
Jevonte Steven Scott: Sentenced in August 2022 to nine years for possession with intent to distribute controlled substances and possession of a firearm in furtherance of a drug trafficking crime.
Krista Marie Sullivan: Sentenced in December 2022 to two years for making false statements during the purchase of firearms. Sullivan was a “straw purchaser” who purchased 11 firearms for Jevonte Steven Scott, who was a felon prohibited from legally purchasing firearms.
Keandre Keith Allen: Sentenced in May 2022 to over five and a half years for being a felon in possession of a firearm.
“Violent gang members who commit heinous acts of gun violence will not be tolerated,” said ATF Acting SAC Craig Kailimai. “We are proud of the collaborative effort with the U.S. Attorney’s office, our federal, State of Michigan, and local partners resulting in getting these violent gang members off of our streets.”
“At the Lansing Police Department, we take pride in working with other agencies to get the job done. This case is a great example of what can be accomplished when law enforcement works together,” said Ellery Sosebee, Chief of Lansing Police Department. “We look forward to continuing these great partnerships and solving more cases in the future.”
Holding illegal firearm possessors accountable through federal prosecution is a centerpiece of the Project Safe Neighborhoods (PSN) Program, the Department of Justice’s violent crime reduction strategy. 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.
Assistant United States Attorney Lauren F. Biksacky prosecuted this case on behalf of the United States.
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Justice Department Secures Agreement with New York IT Staffing Firm to Resolve Immigration-Related Discrimination ClaimsRead the Press Release
The Justice Department announced today that it has reached a settlement agreement with Amiga Informatics (Amiga), a New York IT staffing company. The settlement resolves the department’s determination that Amiga violated the Immigration and Nationality Act (INA) by posting discriminatory job advertisements that solicited applications only from individuals with specific citizenship or immigration statuses.
“Employers have a responsibility to ensure that their job advertisements and hiring processes do not unlawfully exclude individuals because of their citizenship or immigration status,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “The Civil Rights Division is committed to knocking down unnecessary barriers that deny people job opportunities.”
The department’s investigation determined that Amiga posted at least six facially discriminatory job advertisements in 2021. Four of these advertisements sought only U.S. citizens and lawful permanent residents, thereby deterring others with permission to work in the United States without sponsorship, including asylees and refugees, from applying and receiving fair consideration for the employment opportunities. In addition, two advertisements sought only applicants with Optional Practical Training status, a temporary work authorization status given to certain non-U.S. citizen students in the United States. The advertisements thus unlawfully excluded asylees, refugees, lawful permanent residents and U.S. citizens and nationals. The INA’s anti-discrimination provision generally prohibits employers from recruiting or refusing to hire workers based on their citizenship or immigration status.
Under the agreement, Amiga will pay $24,864 in civil penalties to the United States. The agreement also requires Amiga to train its recruiters on the INA’s requirements, revise its employment policies and be subject to departmental monitoring and reporting requirements.
The Civil Rights Division’s Immigrant and Employee Rights Section (IER) is responsible for enforcing the anti-discrimination provision of the INA. The statute prohibits discrimination based on citizenship status and national origin in hiring, firing or recruitment or referral for a fee; unfair documentary practices; and retaliation and intimidation.
Learn more about IER’s work and how to get assistance through this brief video. Find more information on how employers can avoid discrimination when hiring and recruiting on IER’s website. Applicants or employees who believe they were discriminated against based on their citizenship, immigration status, or national origin in hiring, firing, recruitment, or during the employment eligibility verification process (Form I-9 and E-Verify); or subjected to retaliation, may file a charge. The public can also call IER’s worker hotline at 1-800-255-7688 (1-800-237-2515, TTY for hearing impaired); call IER’s employer hotline at 1-800-255-8155 (1-800-237-2515, TTY for hearing impaired); email IER@usdoj.gov; sign up for a free webinar; or visit IER’s English and Spanish websites. Subscribe to GovDelivery to receive updates from IER.
Spanish Version
Justice Department Files Sexual Harassment Lawsuit Against California Rental Property Manager and OwnersRead the Press Release
The Justice Department announced today that it has filed a sexual harassment and retaliation lawsuit under the Fair Housing Act against Joel Nolen, the owner and operator of rental properties in Lassen County, California.
The lawsuit also names as defendants Shirlee Nolen and Nolen Properties LLC, the co-owners of the rental properties at the relevant times. The lawsuit, filed in the U.S. District Court for the Eastern District of California, alleges that Joel Nolen sexually harassed female tenants since at least 2011. According to the complaint, Nolen offered housing-related benefits in exchange for sexual contact, made unwelcome sexual comments and advances to female tenants, entered the homes of female tenants without their permission, subjected female tenants to unwelcome touching and groping, subjected female tenants to unwelcome sexual acts and took adverse housing-related actions against female tenants who refused his sexual advances.
“No one should ever feel unsafe or suffer sexual harassment in their home, especially at the hands of their housing provider,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “The Justice Department is committed to vigorously enforcing the Fair Housing Act and holding landlords and housing providers accountable when they sexually harass their tenants.”
“The sexual harassment and retaliation alleged in today’s complaint violates our federal fair housing laws and will not be tolerated,” said U.S. Attorney Phillip A. Talbert for the Eastern District of California. “Landlords and other housing providers who engage in such conduct will be held accountable to ensure that individuals feel safe and comfortable in their homes.”
The lawsuit seeks monetary damages to compensate persons harmed by the alleged harassment, civil penalties to vindicate the public interest and a court order barring future discrimination.
The Justice Department launched its Sexual Harassment in Housing Initiative in October 2017. The initiative, which is led by the Civil Rights Division, in coordination with U.S. Attorneys’ Offices across the country, seeks to address and raise awareness about sexual harassment by landlords, property managers, maintenance workers, loan officers or other people who have control over housing. Since launching the initiative, the Department of Justice has filed 27 lawsuits alleging sexual harassment in housing and recovered over $9.7 million for victims of such harassment.
The Fair Housing Act prohibits discrimination in housing based on race, color, religion, national origin, sex, disability and familial status. More information about the Civil Rights Division and the laws it enforces is available at www.justice.gov/crt.
Individuals who believe that they may have been victims of sexual harassment or other types of housing discrimination at rental dwellings owned or managed by Joel Nolen, Shirlee Nolen, or Nolen Properties LLC, or who have other information that may be relevant to this case, can contact the Housing Discrimination Tip Line at 1-833-591-0291, select 1 for English, and select option number 2, then option number 7 to leave a message. Individuals may also email the Justice Department at fairhousing@usdoj.gov or submit a report online. Reports also may be made by contacting the U.S. Department of Housing and Urban Development at 1-800-669-9777 or by filing a complaint online.
Justice Department Files Sexual Harassment Lawsuit Against California Rental Property Manager and OwnersRead the Press Release
SACRAMENTO, Calif. — The Justice Department announced today that it has filed a sexual harassment and retaliation lawsuit under the Fair Housing Act against Joel Nolen, the owner and operator of rental properties in Lassen County. The lawsuit also names as defendants Shirlee Nolen and Nolen Properties LLC, the co-owners of Susanville area rental properties at the relevant times. The lawsuit, filed in the U.S. District Court for the Eastern District of California, alleges that Joel Nolen sexually harassed female tenants since at least 2011. According to the complaint, Nolen offered housing-related benefits in exchange for sexual contact, made unwelcome sexual comments and advances to female tenants, entered the homes of female tenants without their permission, subjected female tenants to unwelcome touching and groping, subjected female tenants to unwelcome sexual acts, and took adverse housing-related actions against female tenants who refused his sexual advances.
“The sexual harassment and retaliation alleged in today’s complaint violates our federal fair housing laws and will not be tolerated,” said U.S. Attorney Phillip A. Talbert. “Landlords and other housing providers who engage in such conduct will be held accountable to ensure that individuals feel safe and comfortable in their homes.”
“No one should ever feel unsafe or suffer sexual harassment in their home, especially at the hands of their housing provider,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “The Justice Department is committed to vigorously enforcing the Fair Housing Act and holding landlords and housing providers accountable when they sexually harass their tenants.”
The lawsuit seeks monetary damages to compensate persons harmed by the alleged harassment, civil penalties to vindicate the public interest, and a court order barring future discrimination.
The Justice Department launched its Sexual Harassment in Housing Initiative in October 2017. The initiative, which is led by the Civil Rights Division, in coordination with U.S. Attorneys’ Offices across the country, seeks to address and raise awareness about sexual harassment by landlords, property managers, maintenance workers, loan officers or other people who have control over housing. Since launching the initiative, the Department of Justice has filed 27 lawsuits alleging sexual harassment in housing and recovered over $9.7 million for victims of such harassment.
The Fair Housing Act prohibits discrimination in housing based on race, color, religion, national origin, sex, disability and familial status. More information about the Civil Rights Division and the laws it enforces is available at www.justice.gov/crt.
Individuals who believe that they may have been victims of sexual harassment or other types of housing discrimination at rental dwellings owned or managed by Joel Nolen, Shirlee Nolen, or Nolen Properties LLC, or who have other information that may be relevant to this case, can contact the Housing Discrimination Tip Line at 1-833-591-0291, select 1 for English, and select option number 2, then option number 7 to leave a message. Individuals may also email the Justice Department at fairhousing@usdoj.gov or submit a report online. Reports also may be made by contacting the U.S. Department of Housing and Urban Development at 1-800-669-9777 or by filing a complaint online.
Jury Convicts 29-Year-Old of Conspiracy to Commit Hostage Taking and Conspiracy to Transport Illegal Aliens for ProfitRead the Press Release
TUCSON, Ariz. – Last week, a federal jury found Olegario Lares-De La Rosa, 29, of Mexico, guilty of Conspiracy to Commit Hostage Taking, Conspiracy to Transport Illegal Aliens for Profit, and two counts of Transportation of an Illegal Alien for Profit. Lares-De La Rosa previously pleaded guilty to Felon in Possession of a Firearm on June 9, 2022. Sentencing is scheduled for May 4, 2023, before United States District Judge Jennifer G. Zipps.
The investigation in this case began on April 6, 2022, when Homeland Security Investigations (HSI) received a tip from an individual in New York. The informant told HSI investigators that he had received a call from his cousins, undocumented noncitizens, who said they were being held captive and that their captors demanded $16,000 for their release.
The cousins were detained by three armed men after they crossed illegally into the United States. The armed captors took the victims’ cellphones and transported them to a house where they were held captive for several days. Each evening, the door to their room was screwed shut so they could not escape. On April 8, 2022, Lares-De La Rosa picked up the cousins from the house and brought them to the place where they were to be exchanged for the $16,000 payment.
That same day, Lares-De La Rosa’s co-conspirator, Borboa-Ruiz, met with undercover agents in Tucson to collect the $16,000 payment. After counting the money, Borboa-Ruiz made a call stating that “they were good.” Less than a minute later, the cousins walked single file out of a black Hyundai driven by Lares-De La Rosa. Borboa-Ruiz was immediately arrested.
While the agents were arresting Borboa-Ruiz, Lares-De La Rosa sped away in the Hyundai, leading agents on a high-speed vehicle chase. During the pursuit, Lares-De La Rosa attempted to discard his 9mm pistol by throwing it out of the car. He then bailed out of the Hyundai while it was still in drive, narrowly missing being struck by the vehicle. Lares-De La Rosa then ran into a wash and through a residential neighborhood before he was arrested.
On February 2, 2023, Borboa-Ruiz, 28, of Mexico, pleaded guilty to Conspiracy to Commit Hostage Taking and Illegal Alien in Possession of a Firearm. Sentencing for Borboa-Ruiz is scheduled for April 25, 2023, before Judge Zipps.
HSI conducted the investigation in this case, with assistance from the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Marana Police Department. Assistant United States Attorneys Serra M. Tsethlikai and Jennifer Berman, District of Arizona, Tucson, handled the prosecution.
CASE NUMBER: CR-22-0974-TUC-JGZ
RELEASE NUMBER: 2023-023_Lares-De_La_Rosa# # #
For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
Follow the U.S. Attorney’s Office, District of Arizona, on Twitter @USAO_AZ for the latest news.
Jill E. Steinberg takes oath as U.S. Attorney for the Southern District of GeorgiaRead the Press Release
U.S. District Court Chief Judge J. Randal Hall administers the oath of office to Southern District of Georgia U.S. Attorney Jill E. Steinberg on Wednesday, Feb. 22, 2023, in the Federal Courthouse in Augusta, Ga., observed by U.S. District Court Judge Dudley H. Bowen.
SAVANNAH, GA: Jill E. Steinberg has been sworn in as the U.S. Attorney for the Southern District of Georgia. U.S. District Court Chief Judge J. Randal Hall administered the oath on February 22, 2023. President Joseph R. Biden, Jr. nominated Steinberg to be U.S. Attorney on October 19, 2022, and the U.S. Senate confirmed her nomination on February 16, 2023.
“I am incredibly honored to serve as the United States Attorney for the Southern District of Georgia,” said U.S. Attorney Steinberg. “I look forward to working with the outstanding attorneys and staff in the U.S. Attorney’s Office, our federal, state, and local law enforcement partners, and members of the community to serve the citizens of the district.”
Steinberg has been a partner at Ballard Spahr LLP in Philadelphia, Pennsylvania, since 2021. From 2008 to 2014, and from 2016 to 2021, she served the citizens of Georgia as an Assistant U.S. Attorney and Deputy Criminal Chief in the U.S. Attorney’s Office for the Northern District of Georgia. From 2014 to 2016, Steinberg worked at the Department of Justice in Washington, D.C. where she served as an Attorney Advisor in the National Security Division and then as Associate Deputy Attorney General in the Office of the Deputy Attorney General. From 2001 to 2008, she was an associate at Rogers & Hardin LLP in Atlanta, Georgia.
Steinberg began her legal career as an Assistant District Attorney for the Philadelphia District Attorney’s Office from 1998 to 2001. She received her Juris Doctor from Duke University Law School in 1998 and her Bachelor’s degree, summa cum laude, from the University of Georgia in 1995.
As U.S. Attorney, Steinberg is the chief federal law enforcement officer for the Southern District of Georgia, which covers 43 of Georgia’s 159 counties with a population of more than 1.6 million people and includes the cities of Savannah, Augusta, and Brunswick. She leads a team of approximately 70 attorneys and staff in prosecuting federal crimes in the district and defending the United States in civil cases brought in U.S. District Court. Learn more about the district at www.justice.gov/usao-sdga/about-district.
Jefferson County Man Indicted on Federal Gun Theft Charges for Stealing Numerous Firearms from Licensed DealersRead the Press Release
Louisville, KY – A federal grand jury in Louisville, Kentucky, returned an indictment today charging a local man with stealing firearms from licensed firearms dealers.
U.S. Attorney Michael A. Bennett of the Western District of Kentucky, Acting Special Agent in Charge Robert Maynard of the ATF Louisville Field Division, and Chief Jacquelyn Gwinn-Villaroel of the Louisville Metro Police Department made the announcement.
According to the indictment, Dairon Finisson, 19, was charged with two counts of stealing a firearm from a licensed dealer of firearms. On July 17, 2022, Finisson, aided and abetted by others, is alleged to have stolen 17 pistols, 7 rifles, and a shotgun. On July 20, 2022, Finisson, aided and abetted by others, is alleged to have stolen 6 rifles and 1 pistol.
The defendant will make an initial court appearance before a U.S. Magistrate Judge in the United States District Court for the Western District of Kentucky on a later date. If convicted, Finisson faces a maximum sentence of 20 years in prison. A federal district court judge will determine any sentence after considering the sentencing guidelines and other statutory factors. There is no parole in the federal system.
This case is being investigated by the ATF, Louisville Metro Police Department, and Jeffersontown Police Department.
This case is being prosecuted by Assistant United States Attorney Josh Porter.
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.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
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Hughes County Resident Pleads Guilty to Murder in Indian CountryRead the Press Release
MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced that Michael David Patton, age 30, of Wewoka, Oklahoma entered a guilty plea to an Information charging him with Murder in Indian Country – Second Degree, which is punishable by up to life imprisonment, a fine up to $250,000.00, or both.
The Information alleged that on or about October 19, 2022, the defendant, with malice aforethought, did unlawfully kill the victim. During the plea hearing, the defendant admitted he entered a residence in Wewoka, Oklahoma by force and stabbed the victim over ten times while the victim was sleeping.
The United States Attorney’s Office for the Eastern District of Oklahoma prosecuted the case because the defendant is a member of a federally recognized Indian tribe and the crime occurred in Seminole County, within the boundaries of the Seminole Nation Reservation and within the Eastern District of Oklahoma.
The charges arose from an investigation by the Seminole Lighthorse Police Department, Seminole County Sheriff’s Office, and the Federal Bureau of Investigation.
The Honorable Gerald L. Jackson, U.S. Magistrate Judge in the United States District Court for the Eastern District of Oklahoma, in Muskogee, accepted the plea and ordered the completion of a presentence investigation report. The defendant was remanded into the custody of the United States Marshal pending imposition of sentencing.
Assistant United States Attorney Casey Richmond represented the United States.
Henrico Man Sentenced on Drug Trafficking and Firearm ChargesRead the Press Release
RICHMOND, Va. – A Henrico County man was sentenced today to 110 months in prison for drug trafficking and possession of firearms in furtherance of drug trafficking.
According to court documents, Anthony Sylvester Gaines, 42, rented an extended stay hotel room in Henrico County where he was storing and preparing numerous types of drugs for distribution. When the police searched the room pursuant to a search warrant, the police recovered approximately 132 grams of cocaine, 9 grams of heroin and fentanyl mix, 29 fake Oxycodone “M30” pills that contained fentanyl and 28 red and green tablets that contained methamphetamine. Additionally, the police seized a loaded 9mm semiautomatic pistol from the counter in the bathroom. Inside of Gaines’ vehicle which was parked in the parking lot of the hotel, the police recovered another loaded 9mm semiautomatic pistol along with two additional bags containing cocaine. Gaines was a convicted felon. Gaines was sentenced to 50 months of imprisonment on the drug distribution charge and 60 months consecutive on the firearm charge.
Jessica D. Aber, U.S. Attorney for the Eastern District of Virginia; Rick Edwards, Acting Chief of Richmond Police Department; and Jarod Forget, Special Agent in Charge for the Drug Enforcement Administration’s (DEA) Washington Division, made the announcement after sentencing by U.S. District Judge David J. Novak.
Assistant U.S. Attorney Olivia Norman prosecuted the case.
This case is part of Project Safe Neighborhoods (PSN), which is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
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. 3:22-cr-94.
Hannibal, Missouri, Man Sentenced to 87 Months in Federal Prison for Facilitating Distribution of Methamphetamine and Other DrugsRead the Press Release
SPRINGFIELD, Ill. – A Hannibal, Missouri, man, Orlando Webster, 40, of the 1900 block of Hope Street, was sentenced on February 21, 2023, to 87 months in federal prison for two counts of facilitating the use of communication facilities in furtherance of illegal drug distribution. Upon release from imprisonment, Webster will serve a one-year term of supervised release.
At the sentencing hearing before U.S. District Judge Sue E. Myerscough, the government presented evidence that Webster facilitated drug deals by using a cellular phone. All total, the offenses involved 549 grams of “Ice” methamphetamine, 226 grams of a mixture or substance containing methamphetamine, and 2,544.2 grams of cannabis with the drugs being sent via commercial carrier from California and then distributed in Illinois and Missouri.
Previously, two co-defendants, Tommy Tran and Shawn Davis, were sentenced to 180 months’ imprisonment and 144 months’ imprisonment respectively. Cases against three other co-defendants remain set for either sentencing or trial. Members of the public are reminded that the charges in an indictment are merely accusations, and defendant are presumed innocent unless proven guilty in a court of law.
The statutory penalties for using a communication facility to commit a drug felony are up to four years in prison, one year of supervised release, and a potential fine of up to $250,000.
The case investigation was conducted by the West Central Illinois Task Force, Illinois State Police, and the Quincy Police Department, with assistance from law enforcement agencies in California and Missouri. Assistant U.S. Attorney Tanner Jacobs represented the government in the prosecution.
The case against Webster 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.
Grants Pass Man Sentenced to Federal Prison for Stealing from a Tribal Organization and Illegally Possessing a FirearmRead the Press Release
EUGENE, Ore.—A Grants Pass, Oregon man pleaded guilty and was sentenced to federal prison today for stealing more than $70,000 from the Cow Creek Band of Umpqua Tribe of Indians and illegally possessing a firearm as a convicted felon.
After pleading guilty to one count each of stealing from a Tribal organization and illegally possessing a firearm as a convicted felon, Kevin Lee Jones, 34, was sentenced to 120 months in federal prison and 3 years’ supervised release. Jones was also ordered to pay $74,228 in restitution to the Cow Creek Tribe.
According to court documents, on September 6, 2021, Jones attempted to disguise his identity and stole $74,228 in cash from a business owned by the Cow Creek Tribe in Canyonville, Oregon. Several weeks later, in October 2021, Jones, who has a lengthy criminal history and, as a convicted felon, was prohibited from possessing firearms, was found unresponsive in a car in Grants Pass with a loaded pistol in his waistband. During a later search of his residence, investigators located and seized an M4 rifle with an extended capacity magazine.
On December 14, 2021, Jones was charged by criminal complaint with illegally possessing a firearm as a convicted felon. On December 16, 2021, a federal grand jury in Eugene indicted him on the same charge. Later, on December 29, 2022, he was charged by criminal information with illegally possessing a firearm as a convicted felon and stealing from a Tribal organization.
This case was investigated by the FBI and the Cow Creek Tribal Police Department. It was prosecuted by Jeffrey S. Sweet, Assistant U.S. Attorney for the District of Oregon, in coordination with Josephine County District Attorney Joshua J. Eastman.
Four Charged After A Mail Theft Sting OperationRead the Press Release
LITTLE ROCK—Four individuals have been charged by federal criminal complaint for their alleged involvement in stealing mail from blue postal collection boxes in central Arkansas. Over the weekend, law enforcement conducted numerous sting operations at a number of post office locations. In the early morning hours on Monday, agents arrested Javion Trevon Dozier, 19, Gilpre Flowers, 23, and Jamoun Young, 23, all of North Little Rock. A fourth person remains at large. The three individuals in custody had their initial appearance Wednesday afternoon before United States Magistrate Judge Edie R. Ervin after criminal complaints were filed.
This mail theft investigation began last spring when the U.S. Postal Inspection Service and the Little Rock Police Department began receiving complaints from individuals and businesses in the central Arkansas area that their mail was being stolen. Law enforcement estimates that there have been more than 700 reported victims of mail theft and forgery in connection with this ongoing investigation.
“The arrests in this case demonstrate the commitment of the U.S. Postal Inspection Service to ensure the public’s trust in the Postal Service, its brand, and the U.S. mail,” said Thomas Noyes, Inspector in Charge, Fort Worth Division. “We will continue to dismantle groups responsible for stealing mail and committing fraud. I’d like to thank the Postal Inspectors, Little Rock Police Department, Arkansas State Police, Secret Service and the U.S. Attorney Office, Eastern District of Arkansas, for their diligence and dedication in this investigation.”
“If you steal United States mail, you should expect to go to a United States courthouse. Your crimes are federal crimes and will be prosecuted as such,” United States Attorney Jonathan D. Ross said. In addressing steps the public should take to ensure safe delivery of their mail, Ross stated, “For all of you who would like to see your mail get to where it’s going, take your mail into the post office. If you must deposit your mail in the blue box, please do so before the last posted collection time, and do not use blue boxes on weekends or federal holidays.”
Conspiring to steal mail and theft of mail carry statutory penalties of not more than five years imprisonment. All charges carry a fine of not more than $250,000 and not more than three years of supervised release.
The case is being investigated by the United States Secret Service, the United States Postal Inspection Service, Arkansas State Police, and the Little Rock Police Department. A criminal complaint only contains allegations. A defendant is presumed innocent unless and until proven guilty.
# # #
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
Forsage Founders Indicted in $340M DeFi Crypto SchemeRead the Press Release
PORTLAND, Ore.—A federal grand jury in the District of Oregon returned an indictment today charging four founders of Forsage, a purportedly decentralized finance (DeFi) cryptocurrency investment platform, for their roles in a global Ponzi and pyramid scheme that raised approximately $340 million from victim-investors.
According to court documents, Vladimir Okhotnikov, aka Lado; Olena Oblamska, aka Lola Ferrari; Mikhail Sergeev, aka Mike Mooney, aka Gleb, aka Gleb Million; and Sergey Maslakov, all Russian nationals, allegedly touted Forsage as a decentralized matrix project based on network marketing and “smart contracts,” which are self-executing contracts on the blockchain. As alleged in the indictment, the defendants aggressively promoted Forsage to the public through social media as a legitimate and lucrative business opportunity, but in reality, the defendants operated Forsage as a Ponzi and pyramid investment scheme that took in approximately $340 million from victim-investors around the world.
“Together with our partners, the department is committed to holding accountable fraudsters who cheat investors, including in the emerging DeFi space,” said Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division. “Today’s indictment showcases the department’s ability to use all available investigative tools, including blockchain analysis, to uncover sophisticated frauds involving cryptocurrency and digital assets.”
According to court documents, the defendants allegedly coded and deployed smart contracts that systematized their combined Ponzi-pyramid scheme on the Ethereum (ETH), Binance Smart Chain, and Tron blockchains. Analysis of the computer code underlying Forsage’s smart contracts allegedly revealed that, consistent with a Ponzi scheme, as soon as an investor invested in Forsage by purchasing a “slot” in a Forsage smart contract, the smart contract automatically diverted the investor’s funds to other Forsage investors, such that earlier investors were paid with funds from later investors.
“Today’s indictment is the result of a rigorous investigation that spent months piecing together the systematic theft of hundreds of millions of dollars,” said U.S. Attorney Natalie Wight for the District of Oregon. “Bringing charges against foreign actors who used new technology to commit fraud in an emerging financial market is a complicated endeavor only possible with the full and complete coordination of multiple law enforcement agencies. It is a privilege to work alongside the agents involved in these complex cases.”
As further alleged in the indictment, the defendants falsely promoted Forsage to the public as a legitimate, low-risk, and lucrative investment opportunity through Forsage’s website and various social-media platforms. However, blockchain analytics confirmed that over 80% of Forsage investors received fewer ETH back than they had invested in Forsage’s Ethereum program, with over 50% of investors never receiving a single payout. Additionally, according to court documents, the defendants coded at least one of Forsage’s accounts (known as the “xGold” smart contract on the Ethereum blockchain) in a way that fraudulently siphoned investors’ funds out of the Forsage investment network and into cryptocurrency accounts under the founders’ control, which was contrary to representations made to Forsage investors that “100% of the [Forsage] income goes directly and transparently to the members of the project with zero risk.”
“While advancements in the virtual asset ecosystem bring new opportunities to investors, criminals are also finding new ways to orchestrate illicit schemes,” said Assistant Director Luis Quesada of the FBI’s Criminal Investigative Division. “The FBI remains committed to working alongside our domestic and international law enforcement partners to investigate and pursue subjects who orchestrate these scams and attempt to defraud investors.”
“Technology is always changing and scams and swindles evolve alongside it,” said Inspector in Charge Eric Shen of the U.S. Postal Inspection Service (USPIS), Criminal Investigations Group. “The U.S. Postal Inspection Service is committed to investigating those who engage in schemes involving cryptocurrency investment fraud, which can cause significant financial harm to unsuspecting victims. We urge individuals to be cautious when considering investments and to always do their due diligence before providing money or personal information to any individual or organization.”
“These individuals are alleged to have used trendy technology and opaque language to swindle investors out of their hard-earned cash,” said Special Agent in Charge Ivan J. Arvelo of Homeland Security Investigations (HSI) New York. “But, as the indictment alleges, all they were doing was running a classic Ponzi scheme. The technology may change, but the scams remain the same and with the collaboration amongst all our partners, we’re able to see through the phony promises and bring the schemes to light. HSI is committed to being at the forefront of financial investigations, using the full extent of our investigative capabilities to track down criminals no matter what new tricks they use.”
Okhotnikov, Oblamska, Sergeev, and Maslakov are each charged with conspiracy to commit wire fraud. If convicted, the defendants face a maximum penalty of 20 years in prison.
The FBI Portland Field Office, USPIS, and HSI New York’s El Dorado Task Force are investigating the case.
Trial Attorneys Sara Hallmark and Tian Huang of the Criminal Division’s Fraud Section and Assistant U.S. Attorneys Quinn Harrington and Meredith Bateman for the District of Oregon are prosecuting the case.
All investor victims of the Forsage scheme are encouraged to visit the webpage https://www.justice.gov/criminal-vns/case/united-states-v-vladimir-okhotnikov-et-al to identify themselves as potential victims and obtain more information on their rights as victims, including the ability to submit a victim impact statement.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Forsage Founders Indicted in $340M DeFi Crypto SchemeRead the Press Release
A federal grand jury in the District of Oregon returned an indictment today charging four founders of Forsage, a purportedly decentralized finance (DeFi) cryptocurrency investment platform, for their roles in a global Ponzi and pyramid scheme that raised approximately $340 million from victim-investors.
According to court documents, Vladimir Okhotnikov, aka Lado; Olena Oblamska, aka Lola Ferrari; Mikhail Sergeev, aka Mike Mooney, aka Gleb, aka Gleb Million; and Sergey Maslakov, all Russian nationals, allegedly touted Forsage as a decentralized matrix project based on network marketing and “smart contracts,” which are self-executing contracts on the blockchain. As alleged in the indictment, the defendants aggressively promoted Forsage to the public through social media as a legitimate and lucrative business opportunity, but in reality, the defendants operated Forsage as a Ponzi and pyramid investment scheme that took in approximately $340 million from victim-investors around the world.
“Together with our partners, the department is committed to holding accountable fraudsters who cheat investors, including in the emerging DeFi space,” said Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division. “Today’s indictment showcases the department’s ability to use all available investigative tools, including blockchain analysis, to uncover sophisticated frauds involving cryptocurrency and digital assets.”
According to court documents, the defendants allegedly coded and deployed smart contracts that systematized their combined Ponzi-pyramid scheme on the Ethereum (ETH), Binance Smart Chain, and Tron blockchains. Analysis of the computer code underlying Forsage’s smart contracts allegedly revealed that, consistent with a Ponzi scheme, as soon as an investor invested in Forsage by purchasing a “slot” in a Forsage smart contract, the smart contract automatically diverted the investor’s funds to other Forsage investors, such that earlier investors were paid with funds from later investors.
“Today’s indictment is the result of a rigorous investigation that spent months piecing together the systematic theft of hundreds of millions of dollars,” said U.S. Attorney Natalie Wight for the District of Oregon. “Bringing charges against foreign actors who used new technology to commit fraud in an emerging financial market is a complicated endeavor only possible with the full and complete coordination of multiple law enforcement agencies. It is a privilege to work alongside the agents involved in these complex cases.”
As further alleged in the indictment, the defendants falsely promoted Forsage to the public as a legitimate, low-risk, and lucrative investment opportunity through Forsage’s website and various social-media platforms. However, blockchain analytics confirmed that over 80% of Forsage investors received fewer ETH back than they had invested in Forsage’s Ethereum program, with over 50% of investors never receiving a single payout. Additionally, according to court documents, the defendants coded at least one of Forsage’s accounts (known as the “xGold” smart contract on the Ethereum blockchain) in a way that fraudulently siphoned investors’ funds out of the Forsage investment network and into cryptocurrency accounts under the founders’ control, which was contrary to representations made to Forsage investors that “100% of the [Forsage] income goes directly and transparently to the members of the project with zero risk.”
“While advancements in the virtual asset ecosystem bring new opportunities to investors, criminals are also finding new ways to orchestrate illicit schemes,” said Assistant Director Luis Quesada of the FBI’s Criminal Investigative Division. “The FBI remains committed to working alongside our domestic and international law enforcement partners to investigate and pursue subjects who orchestrate these scams and attempt to defraud investors.”
“Technology is always changing and scams and swindles evolve alongside it,” said Inspector in Charge Eric Shen of the U.S. Postal Inspection Service (USPIS), Criminal Investigations Group. “The U.S. Postal Inspection Service is committed to investigating those who engage in schemes involving cryptocurrency investment fraud, which can cause significant financial harm to unsuspecting victims. We urge individuals to be cautious when considering investments and to always do their due diligence before providing money or personal information to any individual or organization.”
“These individuals are alleged to have used trendy technology and opaque language to swindle investors out of their hard-earned cash,” said Special Agent in Charge Ivan J. Arvelo of Homeland Security Investigations (HSI) New York. “But, as the indictment alleges, all they were doing was running a classic Ponzi scheme. The technology may change, but the scams remain the same and with the collaboration amongst all our partners, we’re able to see through the phony promises and bring the schemes to light. HSI is committed to being at the forefront of financial investigations, using the full extent of our investigative capabilities to track down criminals no matter what new tricks they use.”
Okhotnikov, Oblamska, Sergeev, and Maslakov are each charged with conspiracy to commit wire fraud. If convicted, the defendants face a maximum penalty of 20 years in prison.
The FBI Portland Field Office, USPIS, and HSI New York’s El Dorado Task Force are investigating the case.
Trial Attorneys Sara Hallmark and Tian Huang of the Criminal Division’s Fraud Section and Assistant U.S. Attorneys Quinn Harrington and Meredith Bateman for the District of Oregon are prosecuting the case.
All investor victims of the Forsage scheme are encouraged to visit the webpage www.justice.gov/criminal-vns/case/united-states-v-vladimir-okhotnikov-et-al to identify themselves as potential victims and obtain more information on their rights as victims, including the ability to submit a victim impact statement.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Former Newport News Police Officer Sentenced for Sexual Exploitation of a ChildRead the Press Release
NEWPORT NEWS, Va. – A sixteen-plus year veteran of, and former sergeant with, the Newport News Police Department was sentenced today to 25 years in prison for the sexual exploitation of children and receipt of child pornography.
According to court documents, Michael Nicholas Covey, 39, of Newport News, used a child to engage in sexually explicit conduct for the purposes of producing a visual depiction of such conduct. In a separate investigation, child sexual assault images were found on a convicted sex offender’s electronic devices in Cincinnati, Ohio. Those images were submitted to the National Center for Missing and Exploited Children (NCMEC) in Alexandria. During the analysis of the images, NCMEC determined that the images may have been produced in Newport News. NCMEC forwarded the information to the Southern Virginia Internet Crimes Against Children Task Force, which, in turn, contacted the FBI. Agents with the FBI were able to identify the child depicted in the images. Further investigation led the agents to the defendant, Michael Nicholas Covey. He was arrested on a federal criminal complaint on Friday, June 10.
According to court documents, Covey was originally indicted in June 2022 on three counts of sexual exploitation of a child. Law enforcement later discovered an additional cellular phone belonging to Covey that he had concealed in a container in the back of his patrol vehicle. New evidence on this phone led to additional charges of sexual exploitation of a second minor victim, as well as receipt and possession of child pornography counts in a superseding indictment filed in July 2022. Covey also received a sentencing enhancement for obstructing justice. Covey pleaded guilty to two counts of sexual exploitation of a child and one count of receipt of child pornography last September.
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 sentencing by Chief U.S. District Judge Mark S. Davis.
Newport News Police Department provided significant assistance in this case.
Assistant U.S. Attorneys Lisa McKeel and Peter G. Osyf prosecuted 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. 4:22-cr-48.
Former MoviePass Executive Arrested on Indictment Alleging He Embezzled $260,000 from Employer to Repay Coachella DebtRead the Press Release
LOS ANGELES – A former executive at cinema subscription service MoviePass Inc. has been arrested on a federal grand jury indictment alleging he embezzled approximately $260,000 from MoviePass’ parent company to repay money he borrowed to produce an event at the Coachella music festival, the Justice Department announced today.
Khalid Itum, 42, of Hollywood, was arrested by special agents with the FBI on Tuesday. Itum is charged with two counts of wire fraud and two counts of money laundering.
At his arraignment Tuesday afternoon in United States District Court, Itum pleaded not guilty to the charges, and an April 18 trial date was scheduled. He was ordered released on $75,000 bond.
According to the indictment returned Friday by a federal grand jury, Itum was a MoviePass executive from November 2017 until March 2019. MoviePass was a New York-based company that charged subscribers a flat monthly fee in exchange for credits they could spend on movie tickets from any theater in MoviePass’s network of participating cinemas. In August 2017, Helios & Matheson Analytics (HMNY), a New York-based data analytics company, acquired MoviePass.
In the spring of 2017, Itum registered Kaleidoscope Productions LLC, a Los Angeles-based company that provided production and marketing services. That year, Itum, through Kaleidoscope, organized a party at the annual Coachella Valley Music and Arts Festival in Indio. Neither MoviePass nor HMNY participated in the Coachella event.
Itum borrowed money from two individuals to help fund Kaleidoscope’s costs at Coachella. To repay the borrowed money, Itum later allegedly submitted sham invoices to HMNY for services purportedly rendered by Kaleidoscope and a different company owned by an Itum associate. Itum allegedly caused HMNY employees to wire money from MoviePass and HMNY accounts to a Kaleidoscope bank account to pay the sham invoices. Itum allegedly concealed his scheme by lying to HMNY’s auditor that Kaleidoscope had been used to pay legitimate MoviePass expenses from the 2018 Coachella festival.
Itum caused HMNY a total loss of $260,000, according to the indictment.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
If convicted of all charges, Itum would face a statutory maximum sentence of 20 years in federal prison for each wire fraud count and up to 10 years in federal prison for each money laundering count.
The FBI’s New York Field Office is investigating this matter. The FBI’s Los Angeles Office is providing substantial assistance.
Assistant United States Attorney David Y. Pi of the Major Frauds Section is prosecuting this case.