Chicago Woman Sentenced For Role as Leader of Sex Trafficking Scheme

July 13, 2019, 1:05 pm

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HAMMOND – Rita Law, 60, of Chicago, Illinois, was sentenced by U.S. District Court Judge Joseph S. Van Bokkelen today to serve 360 months in federal prison after being found guilty, following a 3-week jury trial in February 2017, of two counts of trafficking and servitude, one count of transporting a person across state lines with intent that they engage in prostitution, and one count of using an interstate facility to promote prostitution, announced U.S. Attorney Thomas L Kirsch, II. 

The trial evidence established that Law provided and obtained the labor and services of two victims, HV and XC, by means of a scheme to cause them to believe that if they did not perform the labor and services she demanded, they would suffer serious harm or physical restraint. Law was convicted of causing both women to work at her “spas” in northwest Indiana, where they were expected to and did engage in sexual acts in exchange for money with Law’s predominantly male clientele. Law’s businesses were “Duneland Spa” in Lake Station and Gary, Indiana and “Fun Fun Feet” in Hobart, Indiana.  In sentencing Law, the court took into consideration her attempt to flee from the United States to Hong Kong in October 2013 after learning she was under investigation.

In announcing Law’s sentence, U.S. Attorney Kirsch described her offense conduct as “nothing short of diabolical.” “She used the American dream to lure unsuspecting women to the United States so she could enslave them for her own financial benefit.” Kirsch also said “My office’s willingness to extradite Rita Law from Hong Kong and pursue additional charges against her thereafter should serve as a warning to all those committing crime in the Northern District of Indiana – attempting to flee the country will not prevent my office from bringing you to justice.” “Sex trafficking of foreign and domestic victims will not be tolerated in the Northern District of Indiana as long as I am United States Attorney” he concluded.

“Let this sentence serve as a reminder that modern day slavery will not be tolerated,” said Special Agent in Charge James M. Gibbons, Homeland Security Investigations Chicago. “HSI will continue to work relentlessly with its law enforcement partners to bring those to justice who attempt to circumvent the law for financial gain.”

"This sentence cannot begin to compare to the trauma these victims were subjected to, and the life altering consequences they now face because they put their trust and faith in the defendant,” said Grant Mendenhall, Special Agent in Charge of the FBI’s Indianapolis Division. “The FBI will continue working with our law enforcement partners to aggressively identify and pursue the perpetrators of the devastating crime of human trafficking.”

This case resulted from a joint investigation by Homeland Security Investigations and the Federal Bureau of Investigation along with assistance from the following additional law enforcement agencies:  the Gary Indiana Police Department; the Oak Forest Illinois Police Department; the Hammond Indiana Police Department, the Hobart Indiana Police Department, the Lake Station Indiana Police Department, the Lake County Indiana Sheriff’s Office, the Indiana State Police, the United States Marshal’s Service, the Hong Kong Police and the HSI Hong Kong Attaché.

U.S. Attorney Thomas Kirsch, Homeland Security Investigations Special Agent in Charge James Gibbons, and Federal Bureau of Investigation Special Agent in Charge Grant Mendenhall also thanked the following community organizations for providing services to HV and XC during the investigation and prosecution:  Asian Human Services of Chicago, IL; Haven House of Hammond, IN; Cornerstone Community Outreach of Chicago, IL; and Heartland Alliance in Chicago, IL.

This case was prosecuted by Assistant United States Attorneys Jill Koster and Abizer Zanzi.

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Bay City Vascular Surgeon Charged In Connection With $60 Million Health Care Fraud & Laundering More Than $49 Million Government Seeks Forfeiture Of Approximately $39.9 Million Seized From Defendant

July 13, 2019, 1:12 pm

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An indictment unsealed today charges Dr. Vasso Godiali, age 56, vascular surgeon, with orchestrating a $60 million health care fraud scheme.  Dr. Godiali is also charged with money laundering, for financial transactions involving approximately $49 million in proceeds he derived from the scheme.  The indictment was announced by United States Attorney Matthew Schneider.

Schneider was joined in the announcement by Michigan Attorney General Dana Nessel, Special Agent in Charge Timothy R. Slater of the FBI’s Detroit Division and Special Agent in Charge Lamont Pugh III of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Chicago Regional Office.

According to the Indictment, Godiali submitted false and fraudulent claims for the placement of stents in dialysis patients and for the treatment of arterial blood clots. The indictment further alleges that Godiali exploited medical billing software to improperly maximize payments from Medicare, Medicaid, and Blue Cross Blue Shield of Michigan.  The indictment further alleges Godiali submitted false and fraudulent claims to Medicaid, Medicare, and Blue Cross for services not rendered and that he “unbundled” claims by exploiting modifier-59 to falsely claim he was performing many separate and distinct procedures, when in fact he was entitled to a single reimbursement for a single procedure.   

The indictment further alleges that Godiali utilized six corporations through which he laundered approximately $49 million, which he ultimately used to fund investment accounts at multiple financial institutions. In addition, the Indictment alleges that he engaged in money laundering by using proceeds from his scheme to pay property taxes on a Houghton Lake, Michigan, residence.

"This is a large, significant and important prosecution. Health care fraud schemes, such as the one alleged to have been committed by Dr. Godiali, divert millions of dollars from public programs intended to help those in need for the sole purpose of lining the pockets of greedy doctors,”  stated United States Attorney Matthew Schneider. “I salute Attorney General Dana Nessel and her staff, along with the entire law enforcement team that labored so tirelessly on this case.  The work that culminated in to today’s indictment demonstrates cooperation and teamwork at its best.”

“Flagrant efforts to scam Medicare, Medicaid and Blue Cross Blue Shield of Michigan are despicable in any degree—but particularly so when tens of millions of dollars are involved.  Thanks to United States Attorney Matthew Schneider and his team along with the efforts of our own Health Care Fraud Unit and the Michigan Department of Health and Human Services Office of Inspector General staff, which initiated the early investigation into this alleged health care fraud scheme, it has come to a halt,” said Michigan Attorney General Dana Nessel.  “Once it became clear that the potential Medicare fraud exposure in this case was ten times what our own Medicaid fraud exposure was, we reached out to the U.S. Attorney’s Office to increase the depth and breadth of the investigation.  I am proud of the efforts of everyone involved and look forward to making sure this doctor never sees another dime of taxpayer money.”

“Today’s indictment proves the collective resources of law enforcement and the private sector can successfully combat fraud in our health care system,” said Special Agent in Charge Slater. “Fraud schemes of this type cost tax payers billions of dollars each year and remain a top investigative priority of the FBI, HHS, and insurance companies across the country.”

“Healthcare fraud impacts everyone. The submission of false and fraudulent claims drives up the cost of healthcare and wastes vital taxpayer dollars”, said Lamont Pugh III, Special Agent in Charge, U.S. Department of Health & Human Services, Office of Inspector General. “The OIG will continue to work with our federal, state, and private sector partners to identify fraud schemes and hold parties that execute these schemes accountable.”

The United States Attorney’s Office also filed a related civil lawsuit seeking the forfeiture of approximately $39.9 million seized from accounts controlled by the defendant or related to four separate real estate transactions.

An indictment is only a charge and is not evidence of guilt. Each defendant is entitled to a fair trial in which it will be the government's burden to prove guilt beyond a reasonable doubt.

If convicted of a health care fraud charge, the defendant faces a maximum sentence of imprisonment of ten years, and a maximum fine of $250,000 on each count. If convicted of money laundering, the defendant faces a maximum sentence of twenty years of imprisonment, and a maximum fine of twice the amount laundered.

The case was investigated by Special Agents of the HHS and FBI, with cooperation and assistance from the Michigan Attorney General’s Office, Michigan Department of Health and Human Services - Office of Inspector General.

The case is being prosecuted by Assistant U.S. Attorneys Craig F. Wininger and Philip A. Ross.

Four KCMO Residents Plead Guilty to Armed Robberies

July 13, 2019, 1:17 pm

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Two KC Men Face at Least 20 Years in Prison

KANSAS CITY, Mo. – Four Kansas City, Missouri, residents have pleaded guilty in federal court to their roles in a series of armed robberies.

Brion L. McDonald, 30, and Felicia D. Green, 42, pleaded guilty today before U.S. District Judge Stephen R. Bough. McDonald pleaded guilty to one count of robbery. Green pleaded guilty to participating in a conspiracy to commit robbery and to possessing a firearm in furtherance of a crime of violence.

Co-defendant Clyde H. Jackson, Jr., 30, pleaded guilty yesterday to seven counts of robbery, one count of possessing a firearm in furtherance of a crime of violence, and one count of being a felon in possession of a firearm.

Co-defendant Thomas E. Davis, 42, pleaded guilty on July 1, 2019, to five counts of robbery and to possessing a firearm in furtherance of a crime of violence.

The defendants each admitted they were part of a group of individuals committing armed robberies in the Kansas City, Missouri, metropolitan area.

Jackson, Davis, and Green were involved in the armed robberies of Family Dollar, 5242 Blue Ridge Blvd. in Kansas City, on Jan. 12, 2018; Dollar General Store, 8716 Blue Ridge Blvd. in Kansas City, on Jan. 20, 2018; Family Dollar, 9120 E. 35th Street South in Independence, Missouri, on Jan. 22, 2018; and Family Dollar, 3017 Prospect Ave. in Kansas City, on Jan. 26, 2018 (Davis discharged a firearm during this robbery).

Jackson and McDonald each admitted he was involved in the armed robbery of Pizza Hut, 7624 Wornall Road in Kansas City, on March 19, 2018.

Davis was also involved in the armed robbery of Dollar General Store, 9101 E. 63rd St. in Raytown, Missouri, on Oct. 25, 2017. Davis brandished a knife during that robbery.

Jackson admitted he also was involved in an attempted robbery of the Pizza Hut at 7624 Wornall Road on March 20, 2018, and of Dollar General, 5008 N.E. Parvin Road in Kansas City, on March 20, 2018. Jackson also admitted that he was in possession of a Glock .45-caliber pistol and various rounds of ammunition on March 23, 2018. Under federal law, it is illegal for anyone who has been convicted of a felony to be in possession of any firearm or ammunition. Jackson has prior felony convictions for larceny and robbery.

Under the terms of their plea agreements, Jackson and Davis are each subject to a sentence of at least 20 years in federal prison without parole, up to 30 years in federal prison without parole. Sentencing hearings for Jackson and Davis will be on Nov. 7, 2019. Sentencing hearings for Green and McDonald will be on Nov. 25, 2019.

This case is being prosecuted by Assistant U.S. Attorney Emily A. Morgan. It was investigated by the FBI, the Kansas City, Mo., Police Department, the Independence, Mo., Police Department, and the Raytown, Mo., Police Department.

Owner of Essex County-Based Medical Transportation Company Pleads Guilty to Health Care Fraud

July 13, 2019, 1:22 pm

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ALBANY, NEW YORK – Qaiser Gondal, age 47, of Watervliet, New York, pled guilty today to conspiring to defraud Medicaid.

The announcement was made by:

    United States Attorney Grant C. Jaquith;

    New York State Police Superintendent Keith M. Corlett;

    James N. Hendricks, Special Agent in Charge of the Albany Field Office of the Federal Bureau of Investigation (FBI);

    New York State Inspector General Letizia Tagliafierro; and

    Rensselaer County District Attorney Mary Pat Donnelly.

Today’s plea is the result of a state and federal investigation into Medicaid fraud committed by the owners and operators of medical transportation companies based in Essex County.

Qaiser Gondal operated Ti Taxi Inc. (“Ti Taxi”), a Medicaid-funded transportation company based in Ticonderoga, New York.

As part of his plea, Qaiser Gondal admitted that he committed a variety of frauds against Medicaid and the New York State Department of Health, including: billing Medicaid and receiving payment for trips where beneficiaries drove themselves to their own medical appointments, and falsifying the identities of the drivers for those trips; billing Medicaid and receiving payment for roundtrips to and from medical appointments when the beneficiaries took only one-way trips with Ti Taxi; and falsifying pick-up and drop-off locations, in order to increase the purported distances traveled and therefore be able to claim and receive higher Medicaid payments.

Qaiser Gondal also admitted that he paid kickbacks and bribes to Medicaid beneficiaries in order to induce those beneficiaries to schedule and keep scheduling medical transportation appointments with Ti Taxi.  Kickbacks included cash, phone cards, cigarettes and tobacco, and free goods at Gondal’s convenience store in Ticonderoga.

Qaiser Gondal faces up to 10 years in prison, a fine of up to $250,000, and a term of post-imprisonment supervised release of up to 3 years, when he is sentenced on November 14, 2019 by Senior United States District Judge Thomas J. McAvoy.  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.

Qaiser Gondal has also agreed to pay $325,000 in restitution.

Yesterday, Khurram Gondal, age 38, of Ticonderoga, pled guilty to health care fraud in connection with fraudulent Medicaid billing practices connected to two other medical transportation companies, Green Mountain Medical Transportation Inc. and Four Way Taxi, Inc.  Khurram Gondal, who is Qaiser Gondal’s brother, also faces up to 10 years in prison when he is sentenced on November 14, 2019 by Judge McAvoy.  Khurram Gondal has agreed to pay $60,000 in restitution.

Charges remain pending against several other defendants.  Those defendants are presumed innocent unless and until proven guilty.

The federal charges are being investigated by the FBI and the New York State Police’s Special Investigations Unit, and are being prosecuted by Assistant U.S. Attorney Michael Barnett.

Parallel state charges are being investigated by the New York State Police’s Special Investigations Unit, as well as the Office of the New York State Inspector General, and are being prosecuted by Rensselaer County Chief Assistant District Attorney Matthew Hauf as Special Prosecutor.

Several additional agencies assisted in this investigation, including the Essex County District Attorney’s Office; New York State Police-Troop B; the Office of the New York State Comptroller, Division of Investigations; New York State Attorney General’s Office, Medicaid Fraud Control Unit (MFCU); Essex County Sheriff’s Office; Homeland Security Investigations (HSI); the Office of Inspector General for the U.S. Department of Health and Human Services (HHS-OIG); and the New York State Department of Labor.

West Virginia Woman Accused in Multi-State Fraud Scheme Targeting Kmart Stores

July 13, 2019, 1:28 pm

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PITTSBURGH - A West Virginia woman has been indicted by a federal grand jury in Pittsburgh on charges of wire fraud, United States Attorney Scott W. Brady announced today.

The seven-count Indictment, returned on June 25 and unsealed yesterday, named Tanya Thompson, aka Tanya Whetzel, 37, of Martinsburg, West Virginia, as the sole defendant.

According to indictment presented to the court, from approximately June 2017 until December 2017, Thompson traveled to approximately 25 states and purchased, among other things, third party gift cards, including prepaid credit cards, at various Kmart stores using fraudulent mobile phone coupons. The total loss from the fraud scheme is approximately $101,567.50.

The law provides for a maximum total sentence of 20 years in prison for each count, a fine of $250,000 for each count, or both for each count. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.

Assistant United States Attorney Lee J. Karl is prosecuting this case on behalf of the government.

The Federal Bureau of Investigation conducted the investigation leading to the Indictment in this case.

An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.

Previously Convicted Felon from Essex County Sentenced to 10 Years in Prison for Illegally Possessing Firearm

July 14, 2019, 11:41 am

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NEWARK, N.J. – A Newark man who negotiated the sale of 17 firearms over a five-month period was sentenced today to 120 months in prison for possessing a firearm as a previously convicted felon, U.S. Attorney Craig Carpenito announced.

Reginald Moultrie, 50, previously pleaded guilty before U.S. District Claire C. Cecchi to an information charging him with possessing a firearm as a previously convicted felon. Judge Cecchi imposed the sentence today in Newark federal court. 

According to documents filed in this case and statements made in court:

On July 20, 2017, Moultrie, who had at least one prior felony conviction in Essex County Superior Court, possessed an assault rifle capable of accepting a large capacity magazine. As part of the plea agreement, Moultrie also acknowledged that between May 1, 2017, and Sept. 30, 2017, he negotiated the sale of 17 firearms. Moultrie’s nephew, Richard Lowman, previously pleaded guilty to conspiracy to engage in the unlicensed business of dealing in firearms and is awaiting sentencing.

In addition to the prison term, Judge Cecchi sentenced Moultrie to three years of supervised release.

U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark, with the investigation. He also thanked officers from the Newark Police Department, under the direction of Department of Public Safety Director Anthony F. Ambrose, for their assistance.

The government is represented by Assistant U.S. Attorney Thomas S. Kearney of the U.S. Attorney’s Office National Security Unit in Newark.

Former Executive Director Convicted of Stealing Nearly One Million Dollars from Long Island Charity

July 14, 2019, 11:45 am

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Defendant Concealed Payments to Herself for Personal Use, Including Vacations, the Purchase of Her Residence, Broadway Tickets, Cosmetic Surgeries and Spa Treatments

Wafa Abboud, the former Executive Director of Human First, a not-for-profit organization based in Nassau County, New York, that provides services to developmentally disabled individuals, was convicted today by a federal jury in Brooklyn of all counts of a superseding indictment charging her with embezzling funds, bank fraud and money laundering.  The verdict followed a two-week trial before United States District Judge Edward R. Korman.  When sentenced, Abboud faces up to 30 years’ imprisonment.

Richard P. Donoghue, United States Attorney for the Eastern District of New York, announced the verdict. 

“With today’s verdict, Abboud has been held accountable for abusing her position of trust as the Executive Director of a charity and funding her elaborate lifestyle with money  intended to serve the needs of vulnerable individuals in the community,” stated United States Attorney Donoghue.  Mr. Donoghue expressed his grateful appreciation to the Federal Bureau of Investigation, New York Field Office, the New York State Office of the Attorney General and the New York State Office of the Inspector General for their work on the case.

From January 2011 until she was terminated on May 27, 2016, Abboud was Human First’s Executive Director and authorized the disbursement of all of the charity’s funds.  Between May 2011 and February 2016, Abboud caused Human First to issue approximately $16,000 a month in purported consultant fees to MPB Management Services LLC (MPB), a company controlled by co-conspirator Marcelle Bailey.  Every month, Abboud wrote two checks payable to MPB, each for $8,000, and deposited one of the checks into bank accounts in MPB’s name that Abboud controlled.  In total, Abboud diverted $420,000 of Human First funds into the accounts and used the embezzled funds to pay for her personal expenses, including a trip to Disneyland in California, tickets to the Broadway show “Newsies,” visits to luxury spas and high-end beauty salons, cosmetic surgeries and international wire transfers.  Abboud also withdrew nearly $120,000 in cash from the accounts.

Abboud also embezzled more than $440,000 from Human First with her co-conspirator Rami Taha, another consultant who Abboud hired to work at Human First.  In furtherance of this scheme, the defendant approved inflated construction invoices that were submitted to Human First by Taha.  Abboud issued Human First checks to companies controlled by Taha, who in turn diverted the embezzled funds back to Abboud.  Abboud used the funds toward the down payment for her residence and to pay for extensive renovations to the residence.  When Abboud’s mortgage lender asked her about the source of the funds, Abboud, to conceal the embezzlement, falsely represented to the lender that the funds were part of a settlement payment that she had received for damage to her prior residence.  The evidence at trial also established that the defendant awarded herself an annual salary increase to $479,000, without obtaining the required approval from Human First’s Board of Directors, in order to obtain the mortgage loan.

Bailey pleaded guilty in December 2017 to embezzling funds and bank fraud, and Taha pleaded guilty in May 2019 to embezzling funds.  A fourth defendant, Arkadiusz Swiechowicz, pleaded guilty to obstruction of justice in September 2018.  They are awaiting sentencing.

The government’s case is being handled by the Office’s Public Integrity Section.  Assistant United States Attorneys Robert Polemeni and F. Turner Buford are in charge of the prosecution.

The Defendant:

WAFA ABBOUD

Age:  51

Merrick, New York

E.D.N.Y. Docket No. 16-CR-396 (ERK)

Substance Abuse Treatment Center Owner Pleads Guilty To $57 Million Money Laundering Conspiracy In Connection With Hospital Pass-Through Billing Scheme

July 14, 2019, 11:55 am

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Jacksonville, FL – The owner of a Jacksonville, Florida-area substance abuse treatment center pleaded guilty today for his role in a $57 million money laundering conspiracy associated with a pass-through billing scheme involving laboratory testing services.

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Maria Chapa Lopez of the Middle District of Florida, Special Agent in Charge Rachel Rojas of the FBI’s Jacksonville Field Office, Deputy Assistant Inspector General Thomas W. South of the U.S. Office of Personnel Management-Office of Inspector General (OPM-OIG), Special Agent in Charge Rafiq Ahmad of the U.S. Department of Labor-Office of Inspector General (DOL-OIG) and Special Agent in Charge Basil P. Demczak of the Amtrak Office of Inspector General (Amtrak-OIG) made the announcement. 

Kyle Ryan Marcotte, 36, of Jacksonville Beach, Florida, pleaded guilty before U.S. Magistrate Judge Joel Toomey of the Middle District of Florida to a one-count information charging him with conspiracy to commit money laundering.  As part of his guilty plea, Marcotte agreed to a forfeiture judgment of $10,220,281.42.  Sentencing before U.S. District Judge Timothy Corrigan of the Middle District of Florida has not yet been scheduled.

According to admissions made as part of his guilty plea, Marcotte was the owner of a substance abuse treatment facility in Jacksonville Beach, Florida.  In approximately 2015, Marcotte entered into an arrangement with a laboratory owner to send urine samples for the facility’s patients to the owner’s lab for urine drug testing (UDT), in exchange for receiving 40 percent of the insurance reimbursements.  The lab owner, in turn, arranged with the managers of Campbellton–Graceville Hospital (CGH) and Regional General Hospital Williston (RGH), rural hospitals in Florida, to have the testing billed to private insurers through CGH and RGH and reimbursed at favorable rates under the hospitals’ in-network contracts with insurers.  Marcotte also admitted that he brokered deals with other substance abuse treatment centers to have their UDTs billed through CGH and RGH in exchange for Marcotte receiving 10 percent of the insurance reimbursements, while the other substance abuse facilities would receive 30 percent of the insurance reimbursements.

The lab owner subsequently acquired Chestatee Hospital, in Dahlonega, Georgia, and other rural hospitals.  Marcotte admitted that he continued to supply samples from his substance abuse treatment facility and continued to broker deals with other substance abuse treatment centers to have UDTs tested at the lab and billed to insurers through Chestatee and the other hospitals, all in exchange for a percentage of the insurance reimbursements.  The reimbursements were transmitted from the hospitals to the lab, which then transmitted them to two companies Marcotte controlled, North Florida Labs and KTL Labs using financial transactions and bank accounts that Marcotte had established to facilitate the payments.  Marcotte arranged to transfer a portion of the reimbursements from KTL Labs as kickbacks to the individuals and companies that controlled the substance abuse treatment centers in order to further the fraudulent scheme.  Marcotte also transferred a portion of the reimbursements to himself and to purchase real estate and items of real property, he admitted.

Marcotte caused $50 million in payments to be made from KTL Labs’ bank accounts to at least 88 companies and individuals associated with substance abuse treatment centers that supplied urine samples for testing.  The total amount of money that was part of the money laundering  scheme was $57.3 million, Marcotte admitted.

The case was investigated by the FBI, OPM-OIG, DOL-OIG and Amtrak OIG.  Trial Attorneys Gary A. Winters and James V. Hayes of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Tysen Duva of the Middle District of Florida are prosecuting the case.

The Fraud Section leads the Medicare Fraud Strike Force, which is part of a joint initiative between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country.  Since its inception in March 2007, the Medicare Fraud Strike Force, which maintains 14 strike forces operating in 23 districts, has charged nearly 4,000 defendants who have collectively billed the Medicare program for more than $14 billion.  In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

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Leader of Online Car Sales Scam Pleads Guilty

July 14, 2019, 3:50 pm

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Plea agreement includes $9.2 million in restitution

COLUMBUS, Ohio – The leader of an online car sales scam that cheated hundreds of victims around the country pleaded guilty in U.S. District Court today and agreed to pay restitution of $9,262,238.90.

Terry J. Boutwell, 36, of Columbus, pleaded guilty to one count of conspiracy to commit money laundering.

Benjamin C. Glassman, United States Attorney for the Southern District of Ohio, and William Cheung, Acting Special Agent in Charge, Internal Revenue Service (IRS) Criminal Investigation, announced the plea entered before Chief U.S. District Judge Edmund A. Sargus Jr.

Two co-conspirators, Tiffany A. Strobl, 39, of Columbus, Ohio, and Shalitha R. Schexnayder, 39, of Miami, Fla., have also entered guilty pleas and are awaiting sentencing.

Court documents outline the scheme which began in 2015 and continued until the three were indicted in October 2018. The defendants were part of a network that attracted online customers through fraudulent postings for vehicle sales. They communicated with victims through email and telephone posing as employees of eBay, and used third parties to open bank accounts in the names of shell corporations that appeared to be affiliated with eBay. They instructed victims to wire funds to various third-party bank accounts they set up. They claimed to be affiliated with eBay’s Buyer Protection Program, when in fact, no such relationship existed.

“The accounts he controlled received more than $9 million from more than 800 victims around the country,” Glassman said. “Our efforts now will focus on doing as much as we can to collect the restitution and help the victims as the investigation continues.”

“The sophistication and brazenness of the defendant’s on-line car sales scam created havoc on innocent victims and deserves to be punished to the fullest extent of the law,” said William Cheung, Acting Special Agent in Charge, IRS Criminal Investigation, Cincinnati Field Office.

Boutwell was arrested in January when the indictment was announced. Judge Sargus ordered him to remain in custody. The crime is punishable by up to 20 years in prison, followed by up to three years of supervised release and a fine not to exceed $500,000. However, any sentence will be imposed by the court after consideration of U.S. Sentencing Guidelines and applicable federal statutes. The court will determine a date to sentence Boutwell and the others.

U.S. Attorney Glassman commended the investigation of this case by the IRS Criminal Investigation and the assistance of United States Secret Service in Toledo, Ohio and Miami, Fla.; the FBI’s Baltimore field office; United States Postal Inspection Service in Detroit; New York State Police; the Canton, Ohio, Butler Village, Ohio, Mayfield Heights, Ohio, Bloomfield Township, Mich., Marlboro Township, New Jersey and Janesville, Wis. police departments; and the Walworth County, Wis. and Clarke County, Ala. sheriff’s offices. Assistant United States Attorney Noah Litton is representing the United States in this case.

Former Clairton Resident Sentenced for Distributing Fentanyl and Illegally Possessing Firearms

July 14, 2019, 3:52 pm

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PITTSBURGH, PA - A former resident of Clairton, Pennsylvania, has been sentenced in federal court to nine years’ imprisonment, followed by 10 years’ supervised release, on his conviction of conspiring to distribute narcotics and unlawful possession of firearms, United States Attorney Scott W. Brady announced today.

United States District Judge Arthur J. Schwab imposed the sentence on Elliot Page, 38.

According to information presented to the court, Page supplied fentanyl to his codefendants, Skyler Carter and Cecil Shields, and others, for further distribution in the Clairton area. Agents seized approximately one kilogram of fentanyl and three firearms during the execution of a federal search warrant at Page’s residence on July 6, 2017. Page had three prior felony drug offenses and was forbidden from possessing a firearm.

Assistant United States Attorney Carolyn J. Bloch prosecuted this case on behalf of the government.

The Federal Bureau of Investigation led the multi-agency investigation of this case, which also included the Allegheny County Sheriff’s Office, the Allegheny County Police Department, and the Pittsburgh Bureau of Police. The investigation was funded by the federal Organized Crime Drug Enforcement Task Force Program (OCDETF). The OCDETF program supplies critical federal funding and coordination that allows federal and state agencies to work together to successfully identify, investigate, and prosecute major interstate and international drug trafficking organizations and other criminal enterprises.

Illinois Resident Indicted On Bank Robbery Charge

July 15, 2019, 11:48 am

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BOSTON - An Illinois man was indicted yesterday in federal court in Boston in connection with a bank robbery.

Eugene Davis, 54, of Chicago, Ill., was indicted on one count of bank robbery.

It is alleged that on June 3, 2019, Davis robbed a branch of the East Boston Savings Bank located in South Boston.

The charge provides for a sentence of no greater than 20 years in prison, up to five years of supervised release, and a $250,000 fine. Sentences are imposed by a federal district court judge based on the United States Sentencing Guidelines and other statutory factors.

United States Attorney Andrew E. Lelling; Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigations, Boston Field Division; Colonel Kerry A. Gilpin, Superintendent of the Massachusetts State Police; and Boston Police Chief William Gross made the announcement today. Assistant U.S. Attorney Suzanne Sullivan Jacobus of Lelling’s Major Crimes Unit is prosecuting the case.

The details contained in the charging documents are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law. 

San Francisco Man Sentenced To 20 Months Of Imprisonment For Conspiring To Launder Money From Illegal Gambling Business

July 15, 2019, 11:54 am

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SACRAMENTO, Calif. — U.S. District Judge Garland E. Burrell, Jr., sentenced Bar Shani, 27, of San Francisco, to 20 months in prison for conspiring to launder money, U.S. Attorney McGregor W. Scott announced.

According to court documents, between October 2016 and November 2017, Shani conspired to launder the proceeds of an illegal gambling business with Atir Dadon, 34, of Sherman Oaks, and Orel Gohar, 28, of San Francisco. Orel Gohar and Yaniv Gohar, 35, of Berkeley, operated an illegal gambling business that placed and maintained video slot machines at businesses in Northern California, including locations in the Eastern District of California. Shani, Dadon, and Orel Gohar agreed that Orel Gohar would give cash proceeds from the Gohars’ gambling business to Shani and Dadon, who would use the cash to pay the workers in their cosmetics business. They agreed that Orel Gohar would give cash to Shani and Dadon, and in return, they would arrange for Orel Gohar to receive checks from the cosmetics business. To conceal the fact that the financial transactions involved the proceeds of illegal activity, Shani, Dadon, and Orel Gohar used code words in their conversations about the transactions, referring to the money as bottles of alcohol or other non‑cash items. Dadon also put false memo lines on the checks, indicating that Orel Gohar had provided consulting and training services, when in fact he had not done so. Between October 2016 and November 2017, Shani and Dadon laundered $159,900 from the Gohars’ gambling business.

This case is the product of an investigation by the Federal Bureau of Investigation and the California Department of Justice – Bureau of Gambling Control. Assistant U.S. Attorneys Matthew M. Yelovich and Miriam R. Hinman are prosecuting the case.

On July 12, co-defendant Dadon was sentenced by U.S. District Judge Garland E. Burrell, Jr., to 22 months in prison. Co-defendant Adam Atari, 35, of Sherman Oaks, pleaded guilty to conspiring to launder money and witness tampering. Sentencing for Atari is set for Aug. 30. Co-defendant May Levy, 28, of Walnut Creek, pleaded guilty to operating an illegal gambling business, and on May 10, 2018, was sentenced to two years of probation.

Co-defendants Yaniv Gohar and Orel Gohar fled the United States upon their release in December 2017 and remain at large. Anyone with information about their whereabouts should call the Federal Bureau of Investigation at (916) 746-7000.

Co-defendant Raz Razla, 48, of Sherman Oaks, is charged with making false statements to the grand jury. Co-defendant Eran Buhbut, 33, of Oakland, is charged with operating an illegal gambling business. These charges are only allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt. If convicted, these remaining defendants face a statutory maximum penalty of 5 years in prison and a fine of up to $250,000, or both. The actual sentences, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.

Carnegie Man Pleads Guilty to Possession of More than a Kilogram of Heroin

July 15, 2019, 1:00 pm

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PITTSBURGH - A resident of Carnegie, Pennsylvania pleaded guilty in federal court to a charge of possession with the intent to distribute a kilogram or more of heroin, United States Attorney Scott W. Brady announced today.

William Thompson, 36, pleaded guilty to one count before Senior United States District Judge Joy Flowers Conti.

In connection with the guilty plea, the court was advised that on August 7, 2015, law enforcement attempted to stop Thompson, who was then operating a Porsche Cheyenne without a license. Thompson led the police on a high-speed chase on Route 28 during which speeds reached in excess of 100 miles per hour. Thompson eventually crashed and fled on foot, but law enforcement eventually captured him. A search of his vehicle revealed that Thompson was in possession of what later laboratory analysis determined was more than one kilogram of heroin.

Judge Conti scheduled sentencing for Nov. 5, 2019 at 3:30 p.m. The law provides for a maximum total sentence of life in prison, a fine of $10.00.000, or both, and a mandatory minimum of ten years of imprisonment. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.

Assistant United States Attorney Brendan T. Conway is prosecuting this case on behalf of the government.

The FBI Greater Pittsburgh Safe Streets Task Force consisting of Pittsburgh Bureau of Police, Allegheny County Sheriff's Office, Wilkinsburg Police Department, Allegheny County Police Department, Oakdale Police Department, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Drug Enforcement Administration and the Federal Bureau of Investigation conducted the investigation that led to the prosecution of Thompson.

Department of Justice Enables Direct Tribal Access to FBI National Sex Offender Registry Direct Access to FBI CJIS’s National Sex Offender Registry Helps Tribal Governments and Law Enforcement Track and Identify Sex Offenders

July 15, 2019, 1:21 pm

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WASHINGTON, DC — The U.S. Department of Justice announced today a new tool giving tribal governments the ability to directly input data and gain access to the FBI’s National Sex Offender Registry (NSOR) using the Tribe and Territory Sex Offender Registry System (TTSORS).  The system connection will be available to all tribal governments already participating in the Tribal Access Program (TAP), which allows information sharing between tribal and federal government criminal information systems.

TTSORS is a no-cost registry system provided by the Justice Department’s Office of Sex Offender Sentencing, Monitoring, Apprehending, Registering, and Tracking (SMART).  The Department’s Office of the Chief Information Officer (OCIO) developed the connections which allows tribes to seamlessly submit new and updated sex offender information directly from TTSORS to NSOR.

“The Department of Justice is dedicated to addressing the public safety crisis in American Indian and Alaska Native communities, including the high rates of sexual violence against women and children,” said Attorney General William P. Barr.  “Providing a direct connection to the FBI National Sex Offender Registry gives tribal law enforcement the information they need to investigate and prevent these heinous offenses.”

“Nine of our Western Washington tribes participate in TAP, and this new ability to share information will improve safety in our communities,” said U.S. Attorney Brian T. Moran.  “I’m hopeful that more of our tribal partners will successfully apply for TAP funds and we will see additional communities joining in this important information sharing network.”

American Indian and Alaska Native people suffer persistently high rates of victimization, including from sexual assault. According to a 2016 study funded by the National Institute of Justice, more than four in five American Indian and Alaska Native adults have experienced some form of violence in their lifetime, and more than half of all American Indian and Alaska Native women have experienced violence from an intimate partner.  In June, the department extended a deadline for tribes to apply for up to $167 million in federal funds through August 16, 2019, to support crime victims throughout Indian country.

“The direct connection between the National Sex Offender Registry and Tribe and Territory Sex Offender Registry System provides increased resources for identifying, tracking, and sharing information about persons convicted of committing these crimes,” said Gwendena L. Gatewood, Chairwoman of the White Mountain Apache Tribe of the Fort Apache Indian Reservation.  “It will also allow for further improvements in providing a safer community for all involved to integrate tribal law, custom, tradition and practices in a comprehensive fashion consistent with holding offenders accountable.”

“Standing Rock has always had a priority of ensuring public safety,” said Mike Faith, Chairman of the Standing Rock Sioux Tribe.  “Technological advances to our systems ensure that our SORNA staff are able to input offender information and get back in the field while ensuring compliance is maintained.”

The Sex Offender Registration and Notification Act, Title I of the Adam Walsh Child Protection and Safety Act of 2006, requires that, when an offender initially registers or updates his or her information in a jurisdiction, that the state, tribe, territory or District of Columbia must submit immediately the information to NSOR as well as other jurisdictions where the offender has to register. TTSORS is a fully functioning registry system that complies with SORNA requirements. TTSORS was created to assist the Indian tribes that have elected to implement SORNA.

Since 2015, the SMART Office, OCIO, the FBI, the Office of Tribal Justice, Community Oriented Policing Services and the Office for Victims of Crime, have worked together to develop the Tribal Access Program to provide tribes direct access to national crime information systems for both criminal and non-criminal justice purposes. This includes the ability to directly enter NSOR data and enhance the capacity to collect and submit fingerprints and palm prints to the FBI. TAP has been instrumental in assisting tribes with ongoing implementation of SORNA. In fiscal year 2019, the department expanded TAP to 25 more tribes, for a total of 72 participating tribes.

Tribes with TAP access in Western Washington include: Chehalis, Swinomish, Lower Elwha, Quinault, Port Gamble S'Klallam, Suquamish, Tulalip Tribes, Makah, and Lummi Nation.

Twenty-two Individuals Facing Federal Charges following Violence Reduction Partnership Investigation into Gang Violence in Miami Gardens

July 15, 2019, 1:27 pm

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After a lengthy investigation into the criminal conduct of various street gangs operating in and around Miami Gardens, Florida, a federal grand jury indicted 22 people in Miami on charges that include drug trafficking, armed drug trafficking, dealing in firearms, and firearm possession by convicted felons.  Some of the defendants are members and known associates of the Zone 3 gang, a Miami Gardens based gang.

Ariana Fajardo Orshan, U.S. Attorney for the Southern District of Florida, Ari C. Shapira, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Miami Field Division, George L. Piro, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Miami Field Office, Delma Noel-Pratt, Chief of the City of Miami Gardens Police Department, and Gadyaces S. Serralta, U.S. Marshal for the U.S. Marshals Service (USMS) Miami Field Office, made the announcement.

Today’s operation involved approximately 200 federal and local law enforcement officers.  During the course of the operation, law enforcement officers arrested 17 of the 22 indicted defendants and seized over 40 firearms, approximately 220 rounds of assorted ammunition, cash, cocaine, crack, heroin, fentanyl, Alprazolam, marijuana, other drugs, and drug paraphernalia.

“As demonstrated by these charges and the arrests this morning, our commitment to combatting violent crime and drug trafficking in the City of Miami Gardens is unrelenting,” said U.S. Attorney Ariana Fajardo Orshan.  “Thanks to the collaboration of federal and local law enforcement, the armed sale of drugs and firearms by these Zone 3 gang members and associates in the City of Miami Gardens has come to an end.  We will continue to use all the tools at our disposal to combat violence, drug distribution, and the illegal sale and possession of firearms to ensure safety in our communities.”

“Today is truly a good day for our community, parts of which that have been terrorized by this group of violent individuals who have long-created chaos within the City of Miami Gardens.  I am proud of our partnerships to include the Miami Gardens Police Department.  This collaboration has led to the seizure of considerable evidence against this group to include more than 40 firearms,” said Special Agent in Charge Ari Shapira, ATF, Miami Field Division.  As we all know, even one firearm in the wrong hands can destroy countless lives.  This investigation proves that collaboration works, and demonstrates our commitment to combat gun violence and improve the communities of South Florida.  We all want our communities in South Florida to be filled with the sounds of happy children playing outside, not the noise of stray gunfire that strikes fear in the hearts of parents.  The people in Miami Gardens deserve no less.”

“Drug dealing and violent crime associated with gang activity have an insidious impact on our communities.  They take a toll on our citizens through street violence, increased law breaking, and addiction.  The vicious armed gangs pushing this poison into the streets tear apart the fabric of our communities,” said Scott A. Rottman, Assistant Special Agent in Charge, FBI Miami.  “It is a complex problem that requires effective partnerships between law enforcement agencies at the local, state and federal level.  Our combined efforts aim to disrupt and dismantle the criminal organizations involved in the illegal drug trade.  Removing drug traffickers and violent gang members from the streets means they can no longer threaten the health and safety of our communities.  We will continue to target these criminal organizations and their violent activities to ensure they are held responsible for the harm they cause.”

“I’m extremely proud of the hard work and dedication of my lead detectives, as well as other departmental personnel.  As a result of the strong partnerships that have been established with our federal, state and local partners, we are able to bring this case to a successful conclusion, said Miami Gardens Police Department Chief Delma Noel-Pratt.  “This case reaffirms the Miami Gardens Police Department’s commitment to building a safer community.”

“Today, in Miami Gardens, the strong partnership between police officers and federal agents resulted in a successful operation that makes the City of Miami Gardens safer,” said Chief Deputy Darin D. Cooper for the U.S. Marshals Service.  “We remain committed to combatting violent crime.”

“Today is a win for residents of Miami Gardens, South Florida, as well as the many law enforcement agencies that worked together to say collectively, we will not tolerate crimes of any nature,” says Mayor Oliver Gilbert. “We are thankful to everyone involved in this operation and for the collaboration with agencies like the ATF, FBI and DOJ who provided access to expanded resources during the course of this investigation. Our combined efforts and activities have resulted in dangerous individuals, drugs, and illegal guns being taken off our streets.”

THE INDICTMENTS:

(1) United States of America v. Ernest Renard Smith, et al., Case No. 19-20415-CR-Gayles/Otazo-Reyes.

The first indictment, containing 21 counts, names: Ernest Renard Smith (“E. Smith”), 35; Ernest Smith, Jr. (“E. Smith Jr.”), 62; Thaddeus Auguast Smith, Jr. (“T. Smith”), 28; Denico Lynden Dudley McSweeney (“McSweeney”), 30; and Ivan Lewis Harris (“Harris”), 38, all of Miami Gardens.  According to the indictment, from at least as early as May 2018, and continuing through January 29, 2019, the defendants engaged in a conspiracy to possess with intent to distribute heroin, crack cocaine, marijuana, and ecstasy.  E. Smith, E. Smith Jr., T. Smith, and Harris each face up to 20 years in prison if convicted on the conspiracy count.  McSweeney faces up to 40 years in prison if convicted on the conspiracy count.

The first indictment also charges E. Smith with seven counts of possession with intent to distribute a controlled substance, such as heroin, crack cocaine, and/or fentanyl, three counts of dealing in firearms and ammunition, one count of possession of a firearm in furtherance of a drug trafficking crime, and three counts of being a felon in possession.  If convicted on all counts, E. Smith faces up to 20 years in prison on each count of possession with intent to distribute charge, five years in prison on each count of the dealing in firearms and ammunition charge, life imprisonment on the possession of a firearm in furtherance of a drug trafficking charge with a five year mandatory minimum term in prison on this charge, and 10 years in prison on each felon in possession charge.

The first indictment also charges T. Smith with possession with intent to distribute a heroin.  If convicted on this count, T. Smith faces up to 10 years in prison.

The first indictment also charges McSweeney with three counts of dealing in firearms and ammunition and four counts of possession with intent to distribute heroin.  If convicted on all counts, McSweeney faces up to five years in prison on each dealing in firearms charge, and 20 years in prison on each possession with intent to distribute charge.

(2) United States of America v. Sonya Anita Spivey, et al., Case No. 19-20417-Altonaga/Goodman.

The second indictment, containing 10 counts, names: Sonya Anita Spivey (“S. Spivey”), 49, of Miami Gardens; Jacqueline Renee Spivey (“J. Spivey”), 53, of Miami Gardens; Janie Spivey Bryant (“J. Bryant”), 68, of Miami Gardens; Charlie Billy Herman Taylor (“Taylor”), 25, of Miami Gardens; Keno Reuben Teveris Burton (“Burton”), 31, of Miami Gardens; Tekieya Nicole Aldridge (“Aldridge”), 41, of Opa Locka; and Alton Claude Hammonds (“Hammonds”), 38, of Miami.  According to the indictment, from at least as early as August 2018, and continuing through April 11, 2019, the defendants engaged in a conspiracy to possess with intent to distribute N-Ethypentylone, Alprazolam, cocaine, crack cocaine, eutylone, and ecstasy.  The defendants face up to 20 years in prison if convicted on the conspiracy count.

The second indictment also charges S. Spivey with seven counts of possession with intent to distribute a controlled substance, such as, N-Ethypentylone, cocaine, Alprazolam, eutylone, and marijuana. If convicted on all counts, S. Spivey faces up to 5 years in prison for the possession with intent to distribute Alprazolam count and 20 years on each remaining possession with intent to distribute charge.

The second indictment also charges J. Spivey with possession with intent to distribute a controlled substance, such as fentanyl, eutylone, and marijuana.  If convicted on this count, J. Spivey faces up to 20 years in prison.

The second indictment also charges J. Bryant with possession with intent to distribute a controlled substance, such as fentanyl, eutylone, and marijuana.  If convicted on this count, J. Bryant faces up to 20 years in prison.

The second indictment also charges Taylor with possession with intent to distribute Alprazolam and possession of a firearm in furtherance of a drug trafficking crime.  If convicted on both counts, Taylor faces up to five years in prison on the possession with intent to distribute count and life imprisonment on the possession of a firearm in furtherance of a drug trafficking charge with a five year mandatory minimum term in prison on this charge.

The second indictment also charges Burton with possession with intent to distribute a controlled substance, such as cocaine, eutylone, Alprazolam, and marijuana, and possession of a firearm in furtherance of a drug trafficking crime.  If convicted on all counts, Burton faces up to 20 years in prison on the possession with intent to distribute count and life imprisonment on the possession of a firearm in furtherance of a drug trafficking charge with a five-year mandatory minimum term in prison on this charge.

(3) United States of America v. Michael Anthony Hardaway, et al., Case No. 29-20416-CR-Williams/Torres.

The third indictment, containing eight counts, names: Michael Anthony Hardaway, Jr. (“Hardaway”), 42; Clementa Leaford Johnson, Jr. (“Johnson”), 42; Eric Ransom (“Ransom”), 49; Erin Meil Williams (“Williams”), 39; and James Earl Cammon (“Cammon”), 40, all of Miami Gardens.  According to the indictment, from at least as early as October 2018, and continuing through April 11, 2019, the defendants engaged in a conspiracy to possess with intent to distribute eutylone, heroin, fentanyl, cocaine, crack cocaine, ecstasy, Percocet, and marijuana.  The defendants face up to 20 years in prison if convicted on the conspiracy count.

The third indictment also charges Hardaway with four counts of possession with intent to distribute a controlled substance, such as heroin, fentanyl, and crack cocaine.  If convicted on all counts, Hardaway faces up to 20 years in prison on each count.

The third indictment also charges Williams with possession with intent to distribute a controlled substance, such as marijuana, crack cocaine, cocaine, eutylone, and heroin, and possession of a firearm in furtherance of a drug trafficking crime.  If convicted on all counts, Williams faces up to 20 years in prison on each possession with intent to distribute charge and life imprisonment on the possession of a firearm in furtherance of a drug trafficking charge with a five-year mandatory minimum term in prison on this charge.

The third indictment also charges Cammon with possession with intent to distribute a controlled substance, such as marijuana, crack cocaine, cocaine, eutylone, and heroin, possession of a firearm in furtherance of a drug trafficking crime, and being a felon in possession of a firearm.  If convicted on all counts, Cammon faces up to 20 years in prison on each possession with intent to distribute charge, life imprisonment on the possession of a firearm in furtherance of a drug trafficking charge with a five-year mandatory minimum term in prison on this charge, and 10 years in prison on the felon in possession charge.

(4) United States of America v. Dana De Von Smith, Case No. 19-20420-CR-King/Becerra.

The fourth indictment charges Dana De Von Smith (“D. Smith”), 49, of Miami Gardens, with two counts of possession with intent to distribute cocaine.  If convicted on both counts, D. Smith faces up to 20 years in prison on each count.

(5) United States of America v. Theothis Rogers, Case No. 19-20419-CR-Gayles/Otazo-Reyes.

The fifth indictment charges Theothis Rogers (“Rogers”), 37, of Miami Gardens, with two counts of possession with intent to distribute N-Ethylpentylone.  If convicted on both counts, Rogers faces up to 20 years in prison on each count.

(6) United States of America v. Jason Adam Dulman, Case No. 19-20422-CR-Bloom/Louis.

The sixth indictment charges Jason Adam Dulman (“Dulman”), 40, of Dania Beach, with possession with intent to distribute heroin and use of communications facility.  If convicted on both counts, Dulman faces up to 20 years in prison on the possession with intent to distribute charge and four years in prison on the use of communications charge.

(7) United States of America v. Anthony Maurice Smith, Case No. 19-20418-CR-Ungaro/O’Sullivan.

The seventh indictment charges Anthony Maurice Smith (“A. Smith”), 29, of Miami Gardens, with possession with intent to distribute cocaine.  If convicted, A. Smith faces up to 20 years in prison.

(8) United States of America v. Steven Alcime, Case No. 19-20421-CR-Scola/Torres

The eighth indictment charges Steven Alcime (“Alcime”), 30, of Miami, with dealing in firearms and being a felon in possession.  If convicted on both counts, Alcime faces up to five years in prison on the firearms charge and 10 years in prison on the felon in possession charge.

Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendants.

Through the collaborative Southern District of Florida’s Violence Reduction Partnership (“VRP”), the U.S. Attorney’s Office and its federal and local law enforcement allies have sought to dismantle the most violent criminal networks that plague communities throughout the Southern District of Florida. Through these Partnerships, the U.S. Attorney’s Office and its federal and local law enforcement allies have sought to dismantle the most violent criminal networks that plague communities in Miami-Dade, Broward and Palm Beach Counties.  The VRP strives to combat violent crime, narcotics trafficking, gang activity and firearms offenses by prosecuting offenders and working with community leaders and non-profit entities to provide preventive services to the local populations.  The charges announced today are the result of the VRP’s law enforcement initiatives. Additional information regarding the VRP initiatives is available at usafls.vrp@usdoj.gov (link sends e-mail) or by calling (305) 961-9134.

The members of the VRP who participated or assisted in this investigation include the United States Attorney’s Office, Bureau of Alcohol, Tobacco, Firearms and Explosives, Miami Field Office,   Federal Bureau of Investigation, United States Marshals Service Fugitive Task Force, Miami Gardens Police Department, Miami-Dade Police Department, Miami Field Office, Miami-Dade Police Department.

This investigation, Operation End Zone, is a result of the ongoing efforts by the Organized Crime Drug Enforcement Task Force (OCDETF), a partnership between federal, state and local law enforcement agencies.  The OCDETF mission is to identify, investigate, and prosecute high-level members of drug trafficking enterprises, bringing together the combined expertise and unique abilities of federal, state and local law enforcement.

U.S. Attorney Fajardo Orshan commended the FBI, ATF, City of Miami Gardens Police Department, and USMS for their dedicated efforts to combat violent crime and drug trafficking in South Florida.  She thanked the Miami-Dade Police Department for their assistance.  These cases are being prosecuted by Assistant U.S. Attorneys Rilwan Adeduntan and Stephanie Hauser.  Assistant U.S. Attorney William Zloch is handling the forfeiture aspects of this case.

An indictment is a charging instrument containing allegations. Every defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

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Heart Butte man admits distributing meth to minor

July 15, 2019, 1:45 pm

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GREAT FALLS – Gary Allen Jimenez, a Heart Butte resident, admitted drug distribution charges today for providing a minor with methamphetamine on the Blackfeet Indian Reservation, U.S. Attorney Kurt Alme said.

Jimenez, 24, pleaded guilty to distribution of a controlled substance to a person under 21. Jimenez faces a minimum mandatory one year to 40 years in prison, a $2 million fine and at least six years to life of supervised release.

U.S. District Judge Brian M. Morris presided and set sentencing for Oct. 24. Jimenez is detained.

The prosecution said in court records that in early 2017, FBI agents began investigating allegations that persons on the Blackfeet Indian Reservation were providing meth and other drugs to minors. A juvenile girl was identified as being involved in such activity and communicated with potential meth dealers through Facebook. A search of the juvenile’s Facebook accounts identified Jimenez as being involved in illicit transactions with the juvenile, who at the time was between 12 and 14 years of age. The juvenile told law enforcement that he provided her with meth on multiple occasions and that they had smoked it together.

Assistant U.S. Attorney Jeff Starnes prosecuted the case, which was investigated by the FBI and Blackfeet Tribal law enforcement.

The 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.

Sioux Falls Man Sentenced for Wire Fraud and Mail Fraud

July 16, 2019, 12:12 pm

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United States Attorney Ron Parsons announced that a Sioux Falls, South Dakota, man convicted of 10 counts of Wire Fraud and 8 counts of Mail Fraud was sentenced on July 15, 2019, by U.S. District Judge Karen E. Schreier.

Tobias Ritesman, age 42, was sentenced to 108 months in federal prison, followed by 3 years of supervised release, restitution in the amount of $680,000, and a special assessment to the Federal Crime Victims Fund in the amount of $1,800.

Ritesman and co-defendant, Timothy Burns, were indicted by a federal grand jury on January 9, 2018. Ritesman filed a Petition to Plead Guilty on April 15, 2019.  The conviction stemmed from incidents beginning on or about May 3, 2016, and August 1, 2017.

“This is an appropriate federal prison sentence for what was an ambitious and surprisingly audacious fraudulent scheme,” said U.S. Attorney Parsons.  “A lot of South Dakotans lost a lot of money as the result of the web of lies spun by this defendant.”

Ritesman started a company called Ritesman Enterprises, Inc. (REI) in approximately 2012.  Ritesman had three companies that operated under REI’s umbrella: Tinkers and Thinkers, Tiger Consulting, and Global Aquaponics, Inc.  Global Aquaponics was active in pursuing investments for a proposed aquaponics facility to be built in Brookings, South Dakota.  The purpose of this facility was to raise fish and produce.  In approximately June of 2016, Ritesman then formed SD Food Security, LLC (SDFS), which was also involved in the aquaponics project. 

Burns owned and operated multiple businesses in the Brookings area:  Oakwood Equity, Concrete Contractors (CCI), and Multiply.  Burns held these companies under a parent company called Syntech.

The fundraising plan for the aquaponics facility in Brookings was that Global Aquaponics would contribute $5.6 million to the project and own 51% of the facility.  SDFS would contribute $5.4 million to the project (raised primarily by selling investment shares) and own 49% of the facility.

The Private Placement Memorandum (PPM) offering an investment opportunity in the aquaponics facility was dated June 20, 2016, and the offering expired on June 19, 2017.  It stated that the proposed facility was modeled after an aquaponics facility in Maryland.  The PPM said that Global Aquaponics board members included some individuals with aquaponics experience, including an individual involved with the Maryland facility. In addition to describing the project, it identified the specific 40-acre parcel of land near Brookings that would be purchased for the project.  The PPM detailed how it would use the proceeds, including spending nearly $1.2 million for purchasing the property.

Between approximately May 3, 2016, and August 1, 2017, Ritesman and Burns received a total of $1,030,000 in investments in the project from 34 investors.  Bank records showed that the money from investors was deposited into four different accounts.  Ritesman and Burns were each stealing investor money and using it for their own purposes. 

Co-defendant Timothy Burns’ sentencing is set for Monday, July 22, 2019.

This case was investigated by the Federal Bureau of Investigation.  Assistant U.S. Attorney Ann M. Hoffman prosecuted the case.

Ritesman was immediately turned over to the custody of the U.S. Marshals Service.

Attorney, Consultant and Business Owner Indicted for Wire & Bankruptcy Fraud

July 16, 2019, 12:26 pm

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MADISON, WIS. — Chicago attorney Edward Lee Filer, consultant Robert Joseph Gereg and business owner Paul Michael Kelly have been indicted on wire and bankruptcy fraud charges alleging that they created a sham secured creditor with a senior lien on all of the assets of Kelly’s Chicago company, Barsanti Woodwork Corporation, for the purpose of fraudulently shielding the assets from legitimate creditors.

According to the 10 count indictment, Filer, 54, and Kelly, 49, both of Clarendon Hills, Illinois, and Gereg, 71, of Osprey, Florida, created sham limited liability companies and engaged in fraudulent agreements, assignments, transfers, transactions and state and bankruptcy court actions designed to make it appear that the fraudulent transactions involving Barsanti Woodwork’s assets were non-collusive and arms-length, in order to deceive and falsely represent to Barsanti Woodwork’s creditors and later to a bankruptcy trustee that Barsanti Woodwork’s assets had been taken by a secured creditor and that collection activities by legitimate creditors against Barsanti Woodwork would be futile.

Filer, then a partner in a Chicago law firm referred to in the indictment as Law Firm A, is alleged to have caused the fraudulent agreements, assignments, transfers, transactions and state and bankruptcy court actions necessary to accomplish the scheme.

The indictment further alleges that the defendants created BWC Capital to serve as a sham secured creditor of Barsanti Woodwork and falsely represented BWC Capital to be Gereg’s company, when, in reality, Gereg’s role was to conceal Kelly’s control of BWC Capital, as Filer had caused Gereg to secretly assign his interest in BWC Capital to a trust controlled by Kelly.  The defendants then caused BWC Capital to use Barsanti Woodwork’s funds to purchase Barsanti Woodwork’s secured debt from a Bank at a discount and caused that Bank to assign its lien on Barsanti Woodwork’s assets to BWC Capital, giving Kelly control through Gereg of the senior lien on all of Barsanti Woodwork’s assets.

The defendants then allegedly began the process of fraudulently transferring Barsanti Woodwork’s assets to BWC Capital through a state court action using fraudulent back-dated confessions of judgment clauses and Gereg’s false affidavit which inflated the amount Barsanti Woodwork purportedly owed to BWC Capital.  It is specifically alleged that Filer caused the confessions of judgment clauses to be back-dated in order conceal that they lacked consideration and to expedite the transfer of Barsanti Woodwork’s assets in anticipation of bankruptcy.

The indictment further alleges that the defendants created Barsanti Millwork as a sham entity under whose name Barsanti Woodwork continued to operate at the same location, and falsely represented Barsanti Millwork to be Gereg’s company, when, in reality, Gereg’s role was to conceal Kelly’s control of Barsanti Millwork, as Filer had also caused Gereg to secretly assign his interest in Barsanti Millwork to a trust controlled by Kelly.

According to the indictment, the defendants then put Barsanti Woodwork into a bankruptcy in which defendants attempted to conceal the fraudulent transfer of Barsanti Woodwork’s assets, including the use of Barsanti Woodwork’s funds to purchase the bank debt for the benefit of BWC Capital, and made and caused false representations to be made, including that BWC Capital was a creditor with a claim against Barsanti Woodwork. Filer is then alleged to have concealed records from creditors and the bankruptcy trustee. Finally, both Filer and Gereg are alleged to have testified falsely under oath.

The indictment was returned Thursday.  It charges Filer with two counts of wire fraud and eight counts of bankruptcy fraud; Gereg with two counts of wire fraud and seven counts of bankruptcy fraud; and Kelly with two counts of wire fraud and three counts of bankruptcy fraud.  Arraignment in federal court in Chicago has not yet been scheduled.

The law firm of Freeborn & Peters has authorized the disclosure that it is the law firm referred to in the indictment as Law Firm A.  According to Scott C. Blader, United States Attorney for the Western District of Wisconsin, “Freeborn & Peters’ extensive cooperation with this investigation was exemplary and essential to successfully investigating this sophisticated offense.”

“The American public needs to be aware that any fraud or falsehood in connection with bankruptcy seriously undermines the integrity of the system,” said Craig Goldberg, Inspector in Charge of the Chicago Division of the United States Postal Inspection Service. “The U.S. Postal Inspection Service investigates crimes when the mail is used to commit a crime or in furtherance of a crime. The individuals charged in this case allegedly utilized the U.S. Mail as part of their scheme to shield assets from legitimate creditors.”

The indictment was announced by U.S. Attorney Blader, whose office is overseeing the matter; Inspector in Charge Goldberg of the U.S. Postal Inspection Service in Chicago; Irene Lindow, Special Agent-in-Charge of the Chicago Regional Office of the United States Department of Labor, Office of Inspector General; Tara Sullivan, Acting Special Agent-in-Charge  of the Chicago Field Office of the Internal Revenue Service, Criminal Investigation; and Jeffrey S. Sallet, Special Agent-in-Charge of the Chicago office of the FBI. The government is represented by Assistant U.S. Attorney Brian P. Netols and Special Assistant U.S. Attorney Jeffrey S. Snell.

The public is reminded that an indictment is not evidence of guilt.  The defendants are presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.  Each wire fraud count is punishable by a maximum sentence of 20 years in prison, while each count of bankruptcy fraud carries a maximum sentence of five years.  If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.

10 Defendants from South Carolina Lowcountry Face Federal Charges for Drug Distribution Conspiracies

July 16, 2019, 12:28 pm

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Charleston, South Carolina ---- United States Attorney Sherri A. Lydon announced that joint federal, state, and local investigation has resulted in 10 individuals being charged in two separate cases in federal court for their roles in drug trafficking organizations that operated in the Lowcountry of South Carolina.

“Today, we announce the takedown of 10 bad actors through Operation Low Country Line,” said U.S. Attorney Lydon.  “This represents a line of state, local, and federal authorities working in lockstep with one another to curb the violence.  We have drawn a line as we warn those intent on violating the rights of citizens to be safe in their communities that there will be consequences.  With freedom comes responsibility:  The responsibility to adhere to the rule of law.”

“These indictments and arrests are the results of a committed partnership between federal, state and local law enforcement.  Together, we will remain resolved to investigate and arrest those individuals who pose a direct threat to our communities by trafficking in drugs and violence,” said Jody Norris, Special Agent in Charge of the FBI.

In the first indictment, six defendants have been charged with conspiracy to possess with intent to distribute and to distribute cocaine.  Additionally, three of the defendants have been charged with firearms offenses:

Lamar Louis Johnson, a/k/a “McJag,” age 39, of Mount Pleasant, was attributed 5 kilograms or more of cocaine in the conspiracy count and charged with using a communication facility to facilitate drug trafficking and possessing with intent to distribute cocaine;

Theadore Bernard Gadsden, a/k/a “Teddy,” a/k/a “Chest,” age 30, of Mount Pleasant, was attributed a quantity of heroin and 500 grams or more of cocaine in the conspiracy count and charged with possessing with intent to distribute cocaine, being a felon in possession of a firearm, and using a communication facility to facilitate drug trafficking;

Jaton Edwards, a/k/a “Julio,” age 29, of North Charleston, was attributed 500 grams or more of cocaine in the conspiracy count and charged with possessing with the intent to distribute cocaine, using a firearm in furtherance of a drug trafficking crime, and being a felon in possession of a firearm;

Jarvis Behrens, age 27, of Mount Pleasant, was attributed 500 grams or more of cocaine in the conspiracy count and charged with possessing with intent to distribute cocaine;

Theodore Bernard Gadsden, age 60, of Mount Pleasant, was attributed a quantity of cocaine in the conspiracy count and charged with using a communication facility to facilitate drug trafficking and possessing with intent to distribute cocaine; and

Pierce Nelson, age 28, of Mount Pleasant, was attributed a quantity of cocaine in the conspiracy count and charged with possessing with intent to distribute cocaine, using a firearm in furtherance of a drug trafficking crime, and being a felon in possession of a firearm.

In the second indictment, four defendants have been charged with conspiracy to possess with intent to distribute and to distribute heroin, methamphetamine, cocaine, and cocaine base.  Three have been taken into custody:

Devant Porcher, a/k/a “Dub,” age 34, of North Charleston, was attributed 100 grams or more of heroin, 5 grams or more of methamphetamine, 28 grams or more of cocaine base, and a quantity of cocaine in the conspiracy count and charged with 13 additional counts related to the distribution of heroin, methamphetamine, cocaine, and cocaine base;

Melinda Lee Lynch, age 40, of Moncks Corner, was attributed 5 grams or more of methamphetamine in the conspiracy count and charged with possessing with intent to distribute and distributing methamphetamine and heroin; and

Wandesha Smalls, age 36, of North Charleston, was attributed 5 grams or more of methamphetamine and a quantity of heroin in the conspiracy count and charged with possessing with intent to distribute and distributing methamphetamine and heroin.

These nine defendants were taken into custody yesterday morning.  During the course of the investigation into these drug trafficking organizations, agents have seized almost two kilograms of cocaine, almost 100 grams of crack cocaine, 480 grams of heroin, 440 grams of methamphetamine, and seven firearms.

Johnson faces a maximum penalty of life in federal prison and a maximum fine of $10,000,000.  Theadore Gadsden, Edwards, Behrens, Porcher, Lynch, and Smalls each face up to 40 years in federal prison and a maximum fine of $5,000,000.  Theodore Gadsden, Nelson, and Simmons each face up to 20 years in federal prison and a maximum fine of $1,000,000.

The case was investigated by agents of the Federal Bureau of Investigation (FBI), United States Postal Inspection Service, North Charleston Police Department, Mount Pleasant Police Department, City of Charleston Police Department, Charleston County Sheriff’s Office, South Carolina Law Enforcement Division (SLED), and Berkeley County Sheriff’s Office.  It is being prosecuted as part of the joint federal, state, and local Project Safe Neighborhoods (PSN), the centerpiece of the Department of Justice’s violent crime reduction efforts.  PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.  Assistant United States Attorneys Sean Kittrell and Nick Bianchi of the Charleston office are prosecuting the case.

The United States Attorney stated that all charges in these indictments are merely accusations and that all defendants are presumed innocent until and unless proven guilty.

Former U.S. Congressman Chaka Fattah, Sr., Resentenced to 10 Years of Incarceration for Corruption Convictions

July 16, 2019, 12:33 pm

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PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams announced that former U.S. Congressman Chaka Fattah, Sr., 62, of Philadelphia, PA was resentenced to 10 years of incarceration by United States District Judge Harvey Bartle, III.

After a month-long trial in 2016, a federal jury found defendant Fattah and various co-defendants guilty of racketeering conspiracy, wire fraud conspiracy, honest services wire fraud conspiracy, mail fraud conspiracy, and multiple counts of mail fraud, falsification of records, mortgage fraud, and false statements to a financial institution.  The criminal conduct of Fattah and his racketeering enterprise was organized around five corruption and fraud schemes:  a loan repayment scheme, a Blue Guardians scheme, a college tuition scheme, a mortgage fraud scheme, and a fake conference scheme.  For his role in these schemes, Fattah was sentenced after trial to 10 years of incarceration.

Both parties appealed.  With regard to Fattah’s appeal, the Court of Appeals remanded for a new trial as to certain bribery and money laundering counts, concluding that the jury had not been properly instructed regarding “official acts” in a bribery context.  (The government thereafter announced its intention not to retry those counts.)  With regard to the government’s cross-appeal, the Court of Appeals reinstated certain counts that had been dismissed by the District Court post-trial.   The case was then remanded for resentencing.  Today, for these additional counts, Fattah was again sentenced to 10 years of incarceration.

“Let today serve as a warning to all public officials who allow greed or a thirst for influence to overpower any desire to serve the community honestly,” said First Assistant U.S. Attorney Williams.  “If you are a corrupt official, we will investigate and convict you, and we will remain steadfast behind our prosecution until the last appeal is wrapped up and the final proceeding complete.  Today’s sentencing illustrates the strength of our original case and the need to put Chaka Fattah behind bars for a very long time.”

The case was investigated by the Federal Bureau of Investigation, the Internal Revenue Service-Criminal Investigation, the Department of Justice Office of Inspector General, the NASA Office of Inspector General, the Department of Education Office of Inspector General, the Department of Commerce Office of Inspector General, and is being prosecuted by Assistant United States Attorneys Eric L. Gibson and Paul L. Gray.  Jonathan Kravis, former Trial Attorney with the Criminal Division’s Public Integrity Section of the U.S. Department of Justice, also prosecuted this matter.