FROM: U.S. MARSHALS SERVICE
September 25, 2013
U.S. Marshals End Elusive Home Invasion Suspect's Run
Winston Salem, NC –This afternoon at 1:15 PM, Andrew Michael Brackman, a 20 year old, white male was taken into custody by members of the U.S. Marshals Joint Fugitive Task Force (JFTF). Brackman was wanted by the Davidson County Sheriff’s Office for first-degree Burglary, Robbery with a Dangerous Weapon and first-degree Kidnapping.
Brackman was alleged to be the final suspect in the August 16th home invasion off of Riverwood Drive in Southmont. Those previously arrested were Kaylle Michelle Wilkins, 25, and Charles Dietz, 23, both of 7168 Shallowford Road in Winston Salem, and Cole McKay Parris, 23, of 111 Peacock St. The Davidson County Sheriff’s Office alleged in arrest warrants that four people armed with handguns broke into a home on Riverwood Drive between the hours of 4:45 and 5:02 am August 16th. The warrants stated they took 10 firearms, $30,000 in cash, and jewelry in the value of $60,000 by threatening the use of a handgun and kidnapped one of the residents.
After eluding several law enforcement agencies and numerous acquaintances of Brackman concealing his whereabouts, a request was made by the Davidson County Sheriff’s Office for the Greensboro U.S. Marshals Service to assist in Brackman’s apprehension. The JFTF set up surveillance for multiple hours at his girlfriend’s home of 5297 Jay Bird Lane. After a brief stand-off, Brackman was arrested without incident and transported to the Davidson County Jail.
The U.S. Marshals Joint Fugitive Task Force for the Middle District of North Carolina is comprised of investigators from the U.S. Marshals Service, Chapel Hill Police Department, Durham Police Department, Greensboro Police Department, High Point Police Department, Winston Salem Police Department, Alamance County Sheriff’s Office, Orange County Sheriff’s Office, the North Carolina Department of Public Safety Probation and Parole Division and the North Carolina State Highway Patrol.
Monday, September 30, 2013
Sunday, September 29, 2013
FORMER EXECUTIVE CHARGED BY SEC WITH INSIDER TRADING BASED ON CONFIDENTIAL INFORMATION
FROM: U.S. SECURITIES AND EXCHANGE COMMISSION
The Securities and Exchange Commission today charged a former executive at Qualcomm Inc. and his former financial advisor with insider trading ahead of major announcements by the San Diego-based wireless technology company for more than a quarter-million dollars in profits.
The SEC alleges that Jing Wang, a former executive vice president and president of global business operations at Qualcomm, used a secret offshore brokerage account to make illegal trades based on confidential information that he learned on the job. Gary Yin, a former registered representative at Merrill Lynch, helped Wang set up the account. Yin also created a secret offshore account of his own and traded on the non-public information gleaned from Wang. When Wang eventually realized that insider trading in the offshore accounts still may be discovered by the SEC or other regulators, he concocted a plan to conceal his trading activity by claiming the trades were made by his brother. Wang even convinced Yin to travel to China and go over the account statements with Wang’s brother so he could explain the trades if asked by investigators.
“Wang violated his duty as an insider to protect confidential information when he made timely illegal trades ahead of major announcements to the detriment of other Qualcomm shareholders who did not have the same information,” said Michele Wein Layne, Director of the SEC’s Los Angeles Regional Office. “Wang and Yin went to extraordinary lengths to conceal their trading and cover it up afterwards, but despite their expansive efforts they still wound up in law enforcement’s crosshairs.”
In a parallel action, the U.S. Attorney’s Office for the Southern District of California today announced criminal charges against Wang and Yin.
According to the SEC’s complaint, Wang and Yin became friends in 2005 as members of the same church. When Wang learned that Yin was a financial advisor at Merrill Lynch, he asked Yin to manage his money and opened a number of brokerage accounts at the firm’s San Diego branch office. Each account was disclosed to Qualcomm because, as a company officer, Wang was restricted in his ability to trade Qualcomm stock and required to pre-clear all Qualcomm trades with the company.
The SEC alleges that in early 2006, Wang approached Yin about hiding cash transactions. Yin suggested that Wang create an entity registered in the British Virgin Islands (BVI) and use the name of a non-U.S. citizen family member as the beneficial owner. Then he could open a brokerage account in the newly created entity’s name. Yin then helped Wang set up a secret account in the name of a BVI company called Unicorn Global Enterprises, and Wang’s older brother was listed as the owner. Yin similarly created his own BVI-registered entity named Pacific Rim and put it in his mother-in-law’s name. Yin opened a Merrill Lynch brokerage account for Pacific Rim and used it to hide funds that he was using for investments.
The SEC alleges that Wang and Yin used their secret offshore accounts to trade on material, non-public information that Wang learned as an executive at Qualcomm. In early 2010, Wang was aware that Qualcomm executives were planning a board proposal to increase Qualcomm’s quarterly dividends and request authority to initiate a stock repurchase program. Qualcomm informed Wang and all executives that they would not be permitted to trade Qualcomm stock. On March 1, Wang attended a Qualcomm board meeting where the quarterly dividend increase and stock repurchase were approved. Wang immediately instructed Yin to use all of the funds in the offshore Unicorn account to purchase Qualcomm stock. Yin knew that Wang did not pre-clear these trades and realized that the purchase was out of character for Wang because he previously never purchased Qualcomm stock on the open market in his Merrill Lynch accounts. Within the hour of executing the trades for Wang, Yin himself bought Qualcomm stock on the basis of the material, non-public information. The stock price increased 6.7 percent after Qualcomm publicly announced the quarterly cash dividend and stock repurchase program. Wang and Yin profited when they sold all of their shares.
According to the SEC’s complaint, Wang used the funds from that sale to conduct insider trading again – this time in the shares of San Jose-based Atheros Communications, which was the highly confidential target of a planned acquisition by Qualcomm. Wang was regularly briefed on the transaction internally tabbed as “Project Tango” to protect its confidentiality. Wang instructed Yin to sell all of his Qualcomm stock in the Unicorn account on Dec. 2, 2010, and prepare to buy as many shares of Atheros stock as possible with the funds in that account. He told Yin that he was leaving on a trip to China and would contact him to execute the Atheros trade. On December 6, Wang attended a Qualcomm board meeting in Hong Kong and a resolution was passed to pursue the acquisition. Wang learned that Qualcomm planned to acquire Atheros at $45 per share. Wang and Yin immediately communicated several times through phone calls and a text message, and Wang then purchased the maximum number of shares he could purchase with the existing funds in the Unicorn account at prices between $34 and $35 per share. At Wang’s encouragement, Yin also purchased Atheros stock for himself in his offshore account. When the news became public in early January, Atheros stock increased more than 20 percent. Yin sold all of his Atheros shares in the Pacific Rim account on January 12, and Wang sold his Atheros shares in the Unicorn account on January 25.
According to the SEC’s complaint, Wang took his next insider trading step merely four minutes after selling the Atheros stock, using the proceeds to purchase Qualcomm shares in advance of a company announcement that it would raise its revenue and earnings guidance for the 2011 fiscal year. Wang had learned the confidential information prior to the board meeting he attended in Hong Kong, where Qualcomm’s better-than-expected first quarter financial performance was further discussed. Wang learned that Qualcomm planned to announce its earnings results on January 26, and thus purchased his Qualcomm shares the day before the announcement. After Qualcomm issued a press release to announcing its positive first quarter results, Qualcomm’s stock increased 5.9 percent.
The SEC alleges that Wang made more than $244,000 in illegal profits through the insider trading scheme, and Yin realized gains of more than $27,000. Wang eventually realized that his illegal trading may be detected by Merrill Lynch or others. Wang first asked Yin to delete records of the trades in the Unicorn account, but because they were permanent records in Merrill Lynch’s systems they could not be erased. Around January 2012, Wang directed Yin to establish a new BVI corporation named Clearview Resources and open a new account at Merrill Lynch to which they transferred the insider trading proceeds in the Unicorn account to further distance Wang from the suspicious trades. A few months later, Wang informed Yin that the trades may have been detected because the SEC had subpoenaed his e-mails. So Wang devised a cover story and convinced Yin if ever questioned to say that the Atheros trades were made by Wang’s brother. Because Yin had never communicated with Wang’s brother, Wang instructed him to travel to China with the Unicorn account statements and review the trades with his brother so he could explain the trading if asked. Yin did so in May 2012. To further hide Wang’s ownership of the Unicorn account and his link to the Atheros trades, Yin removed the Unicorn account from Wang’s “household” in Merrill Lynch’s computer system in July 2012. “Householding” is a function used by Merrill Lynch to link related accounts.
The SEC's complaint charges Wang, who lives in Del Mar, Calif., with violating Sections 10(b) and 16(a) of the Securities Exchange Act of 1934 and Rules 10b-5 and 16a-3. Yin, who lives in San Diego, is charged with violating Section 10(b) of the Exchange Act and Rule 10b-5. The SEC’s complaint seeks disgorgement of ill-gotten gains plus prejudgment interest, financial penalties, and permanent injunctions. The SEC also seeks an officer-and-director bar against Wang.
The SEC’s investigation has been conducted by Ann C. Kim, Wendy E. Pearson, Nina Yamamoto, and Finola H. Manvelian of the Los Angeles Regional Office. The SEC’s litigation will be led by Sam Puathasnanon. The SEC appreciates the assistance of the Department of Justice’s Criminal Division, the U.S. Attorney’s Office for the Southern District of California, and the Federal Bureau of Investigation.
The Securities and Exchange Commission today charged a former executive at Qualcomm Inc. and his former financial advisor with insider trading ahead of major announcements by the San Diego-based wireless technology company for more than a quarter-million dollars in profits.
The SEC alleges that Jing Wang, a former executive vice president and president of global business operations at Qualcomm, used a secret offshore brokerage account to make illegal trades based on confidential information that he learned on the job. Gary Yin, a former registered representative at Merrill Lynch, helped Wang set up the account. Yin also created a secret offshore account of his own and traded on the non-public information gleaned from Wang. When Wang eventually realized that insider trading in the offshore accounts still may be discovered by the SEC or other regulators, he concocted a plan to conceal his trading activity by claiming the trades were made by his brother. Wang even convinced Yin to travel to China and go over the account statements with Wang’s brother so he could explain the trades if asked by investigators.
“Wang violated his duty as an insider to protect confidential information when he made timely illegal trades ahead of major announcements to the detriment of other Qualcomm shareholders who did not have the same information,” said Michele Wein Layne, Director of the SEC’s Los Angeles Regional Office. “Wang and Yin went to extraordinary lengths to conceal their trading and cover it up afterwards, but despite their expansive efforts they still wound up in law enforcement’s crosshairs.”
In a parallel action, the U.S. Attorney’s Office for the Southern District of California today announced criminal charges against Wang and Yin.
According to the SEC’s complaint, Wang and Yin became friends in 2005 as members of the same church. When Wang learned that Yin was a financial advisor at Merrill Lynch, he asked Yin to manage his money and opened a number of brokerage accounts at the firm’s San Diego branch office. Each account was disclosed to Qualcomm because, as a company officer, Wang was restricted in his ability to trade Qualcomm stock and required to pre-clear all Qualcomm trades with the company.
The SEC alleges that in early 2006, Wang approached Yin about hiding cash transactions. Yin suggested that Wang create an entity registered in the British Virgin Islands (BVI) and use the name of a non-U.S. citizen family member as the beneficial owner. Then he could open a brokerage account in the newly created entity’s name. Yin then helped Wang set up a secret account in the name of a BVI company called Unicorn Global Enterprises, and Wang’s older brother was listed as the owner. Yin similarly created his own BVI-registered entity named Pacific Rim and put it in his mother-in-law’s name. Yin opened a Merrill Lynch brokerage account for Pacific Rim and used it to hide funds that he was using for investments.
The SEC alleges that Wang and Yin used their secret offshore accounts to trade on material, non-public information that Wang learned as an executive at Qualcomm. In early 2010, Wang was aware that Qualcomm executives were planning a board proposal to increase Qualcomm’s quarterly dividends and request authority to initiate a stock repurchase program. Qualcomm informed Wang and all executives that they would not be permitted to trade Qualcomm stock. On March 1, Wang attended a Qualcomm board meeting where the quarterly dividend increase and stock repurchase were approved. Wang immediately instructed Yin to use all of the funds in the offshore Unicorn account to purchase Qualcomm stock. Yin knew that Wang did not pre-clear these trades and realized that the purchase was out of character for Wang because he previously never purchased Qualcomm stock on the open market in his Merrill Lynch accounts. Within the hour of executing the trades for Wang, Yin himself bought Qualcomm stock on the basis of the material, non-public information. The stock price increased 6.7 percent after Qualcomm publicly announced the quarterly cash dividend and stock repurchase program. Wang and Yin profited when they sold all of their shares.
According to the SEC’s complaint, Wang used the funds from that sale to conduct insider trading again – this time in the shares of San Jose-based Atheros Communications, which was the highly confidential target of a planned acquisition by Qualcomm. Wang was regularly briefed on the transaction internally tabbed as “Project Tango” to protect its confidentiality. Wang instructed Yin to sell all of his Qualcomm stock in the Unicorn account on Dec. 2, 2010, and prepare to buy as many shares of Atheros stock as possible with the funds in that account. He told Yin that he was leaving on a trip to China and would contact him to execute the Atheros trade. On December 6, Wang attended a Qualcomm board meeting in Hong Kong and a resolution was passed to pursue the acquisition. Wang learned that Qualcomm planned to acquire Atheros at $45 per share. Wang and Yin immediately communicated several times through phone calls and a text message, and Wang then purchased the maximum number of shares he could purchase with the existing funds in the Unicorn account at prices between $34 and $35 per share. At Wang’s encouragement, Yin also purchased Atheros stock for himself in his offshore account. When the news became public in early January, Atheros stock increased more than 20 percent. Yin sold all of his Atheros shares in the Pacific Rim account on January 12, and Wang sold his Atheros shares in the Unicorn account on January 25.
According to the SEC’s complaint, Wang took his next insider trading step merely four minutes after selling the Atheros stock, using the proceeds to purchase Qualcomm shares in advance of a company announcement that it would raise its revenue and earnings guidance for the 2011 fiscal year. Wang had learned the confidential information prior to the board meeting he attended in Hong Kong, where Qualcomm’s better-than-expected first quarter financial performance was further discussed. Wang learned that Qualcomm planned to announce its earnings results on January 26, and thus purchased his Qualcomm shares the day before the announcement. After Qualcomm issued a press release to announcing its positive first quarter results, Qualcomm’s stock increased 5.9 percent.
The SEC alleges that Wang made more than $244,000 in illegal profits through the insider trading scheme, and Yin realized gains of more than $27,000. Wang eventually realized that his illegal trading may be detected by Merrill Lynch or others. Wang first asked Yin to delete records of the trades in the Unicorn account, but because they were permanent records in Merrill Lynch’s systems they could not be erased. Around January 2012, Wang directed Yin to establish a new BVI corporation named Clearview Resources and open a new account at Merrill Lynch to which they transferred the insider trading proceeds in the Unicorn account to further distance Wang from the suspicious trades. A few months later, Wang informed Yin that the trades may have been detected because the SEC had subpoenaed his e-mails. So Wang devised a cover story and convinced Yin if ever questioned to say that the Atheros trades were made by Wang’s brother. Because Yin had never communicated with Wang’s brother, Wang instructed him to travel to China with the Unicorn account statements and review the trades with his brother so he could explain the trading if asked. Yin did so in May 2012. To further hide Wang’s ownership of the Unicorn account and his link to the Atheros trades, Yin removed the Unicorn account from Wang’s “household” in Merrill Lynch’s computer system in July 2012. “Householding” is a function used by Merrill Lynch to link related accounts.
The SEC's complaint charges Wang, who lives in Del Mar, Calif., with violating Sections 10(b) and 16(a) of the Securities Exchange Act of 1934 and Rules 10b-5 and 16a-3. Yin, who lives in San Diego, is charged with violating Section 10(b) of the Exchange Act and Rule 10b-5. The SEC’s complaint seeks disgorgement of ill-gotten gains plus prejudgment interest, financial penalties, and permanent injunctions. The SEC also seeks an officer-and-director bar against Wang.
The SEC’s investigation has been conducted by Ann C. Kim, Wendy E. Pearson, Nina Yamamoto, and Finola H. Manvelian of the Los Angeles Regional Office. The SEC’s litigation will be led by Sam Puathasnanon. The SEC appreciates the assistance of the Department of Justice’s Criminal Division, the U.S. Attorney’s Office for the Southern District of California, and the Federal Bureau of Investigation.
Saturday, September 28, 2013
EL SALVADORIAN NATIONAL CONVICTED FOR FAILURE TO REGISTER AS SEX OFFENDER, UNLAWFUL REENTRY
FROM: U.S. MARSHALS SERVICE
September 20, 2013
El Salvadorian National Convicted for Failure to Register as a Sex Offender and Unlawful Reentry
Alexandria, VA – Nelson Anibal Alas Carabantes, 38, was sentenced to 24 months in prison followed by three years of supervised release for unlawful reentry into the United States after being deported and after having been convicted of an aggravated felony. Alas Carabantes will also serve 10 years of supervised release for failure to register as a sex offender.
M. Yvonne Evans, Field Office Director of the U.S. Immigration and Customs Enforcement (ICE) Enforcement and Removal Operations (ERO) Washington Field Office, and Robert Mathieson, U.S. Marshal for the Eastern District of Virginia (E/VA), made the announcement after sentencing by United States District Judge Liam O’Grady.
Field Office Director Evans stated, “ICE will continue to use immigration enforcement to target recidivist offenders and abusers of our immigration system. Our commitment to partnerships with other law enforcement agencies targeting these individuals only serves to strengthen our efforts.” Chief Deputy U.S. Marshal for E/VA John O. Bolen exclaimed, “This is yet another fine example of the absolute commitment the U.S. Marshals Service has in working jointly to protect our communities from sexual predators.”
Alas Carabantes pleaded guilty to both counts on June 12. According to court documents, Alas Carabantes is a native and citizen of El Salvador who unlawfully entered the United States after being ordered removed as an aggravated felon. In 1994, Alas Carabantes was convicted in the Circuit Court of Pinellas County, Florida for lewd, lascivious acts with a child under the age of 16 and was required to register as a violent sex offender. Law enforcement officers from the U.S. Marshals, ICE, and law enforcement investigators in Texas, Florida, and Virginia helped capture Alas Carabantes after a six month manhunt. Alas Carabantes was also previously convicted for throwing a deadly missile, and assault and battery. Alas Carabantes was also convicted in El Salvador for illegal possession of firearms and sentenced to three years.
This case was investigated by the U.S. Marshals Service and ICE ERO.
September 20, 2013
El Salvadorian National Convicted for Failure to Register as a Sex Offender and Unlawful Reentry
Alexandria, VA – Nelson Anibal Alas Carabantes, 38, was sentenced to 24 months in prison followed by three years of supervised release for unlawful reentry into the United States after being deported and after having been convicted of an aggravated felony. Alas Carabantes will also serve 10 years of supervised release for failure to register as a sex offender.
M. Yvonne Evans, Field Office Director of the U.S. Immigration and Customs Enforcement (ICE) Enforcement and Removal Operations (ERO) Washington Field Office, and Robert Mathieson, U.S. Marshal for the Eastern District of Virginia (E/VA), made the announcement after sentencing by United States District Judge Liam O’Grady.
Field Office Director Evans stated, “ICE will continue to use immigration enforcement to target recidivist offenders and abusers of our immigration system. Our commitment to partnerships with other law enforcement agencies targeting these individuals only serves to strengthen our efforts.” Chief Deputy U.S. Marshal for E/VA John O. Bolen exclaimed, “This is yet another fine example of the absolute commitment the U.S. Marshals Service has in working jointly to protect our communities from sexual predators.”
Alas Carabantes pleaded guilty to both counts on June 12. According to court documents, Alas Carabantes is a native and citizen of El Salvador who unlawfully entered the United States after being ordered removed as an aggravated felon. In 1994, Alas Carabantes was convicted in the Circuit Court of Pinellas County, Florida for lewd, lascivious acts with a child under the age of 16 and was required to register as a violent sex offender. Law enforcement officers from the U.S. Marshals, ICE, and law enforcement investigators in Texas, Florida, and Virginia helped capture Alas Carabantes after a six month manhunt. Alas Carabantes was also previously convicted for throwing a deadly missile, and assault and battery. Alas Carabantes was also convicted in El Salvador for illegal possession of firearms and sentenced to three years.
This case was investigated by the U.S. Marshals Service and ICE ERO.
Thursday, September 26, 2013
FORMER FEDERAL CONTRACTOR PLEADS GUILTY TO DISCLOSURE OF DEFENSE INFORMATION AND DISTRIBUTING CHILD PORNOGRAPHY
FROM: U.S. JUSTICE DEPARTMENT
Monday, September 23, 2013
Former Federal Contractor Petitions to Plead Guilty to Unlawfullly Disclosing National Defense Information and Distributing Child Pornography
Donald John Sachtleben, a former FBI bomb technician who later worked as a government contractor for the agency, has filed a petition to plead guilty to newly filed charges of unlawfully disclosing national defense information relating to a disrupted terrorist plot. Sachtleben previously had filed a petition to plead guilty to charges of possessing and distributing child pornography resulting from a separate investigation.
Sachtleben, 55, of Carmel, Ind., has signed plea agreements in both cases. The documents were filed today in the U.S. District Court for the Southern District of Indiana. Charges in the national security case were filed today, and charges in the child pornography case were filed in May 2012.
The developments were announced by Deputy Attorney General James M. Cole; Ronald C. Machen Jr., U.S. Attorney for the District of Columbia Joseph H. Hogsett, U.S. Attorney for the Southern District of Indiana, and Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office.
The plea agreements signed by the parties would resolve both cases in court proceedings in Indiana. The agreements, which are contingent upon the Court’s approval, call for Sachtleben to plead guilty to the two national security charges as well as the two child pornography offenses. The plea agreements call for Sachtleben to be sentenced to a total of 140 months of incarceration, including a 43-month prison term for the national security offenses and a consecutive 97-month term for the child pornography charges.
The statements of offense related to both the national defense charges and the child pornography charges are attached.
“This unauthorized and unjustifiable disclosure severely jeopardized national security and put lives at risk,” Deputy Attorney General Cole said. “To keep the country safe, the department must enforce the law against such critical and dangerous leaks, while respecting the important role of the press under the department’s media guidelines and any shield law enacted by Congress. I am grateful to the FBI and the U.S. Attorneys’ offices in both Washington, D.C., and Indiana for their excellent and dedicated work on this case.”
“Fifteen months ago, we were given the task of uncovering who had threatened a sensitive intelligence operation and endangered lives by illegally disclosing classified information relating to a disrupted al-Qaeda suicide bomb plot,” said U.S. Attorney Machen. “That plot could not have been more serious, as it targeted a plane bound for the United States. After unprecedented investigative efforts by prosecutors and FBI agents and analysts, today Donald Sachtleben has been charged with this egregious betrayal of our national security. This prosecution demonstrates our deep resolve to hold accountable anyone who would violate their solemn duty to protect our nation’s secrets and to prevent future, potentially devastating leaks by those who would wantonly ignore their obligations to safeguard classified information.”
“The allegations in this case describe the defendant’s repeated violation of a sacred trust that the public had placed in him,” said U.S. Attorney Hogsett. “With these charges, a message has been sent that this type of behavior is completely unacceptable and no person is above the law.”
“Today, Mr. Sachtleben has been charged with knowingly and willfully disclosing national defense information to a member of the media,” said Assistant Director in Charge Parlave. “These charges are the result of a careful and thorough investigation by FBI Special Agents and analysts who, together with federal prosecutors, systematically conducted more than 500 interviews and, following that exhaustive process, analyzed relevant telephone records obtained by subpoena. After analysis of the telephone records, investigators identified him as the source of this unlawful disclosure. The FBI will continue to take all necessary steps to pursue such individuals who put the security of our nation and the lives of others at risk by their disclosure of sensitive information.”
**
National Security Case:
According to a criminal information filed today, on May 2, 2012, nine days before Sachtleben was arrested in Indiana on child pornography charges, Sachtleben knowingly and willfully disclosed national defense information to a reporter for a national news organization not entitled to receive it. The charging document alleges that Sachtleben had reason to believe that this information could be used to the injury of the United States and to the advantage of a foreign nation. The criminal information also charges him with willfully retaining documents relating to the national defense without authorization.
Sachtleben worked for the FBI from 1983 through 2008. During his career, he was a Special Agent Bomb Technician and was assigned to work on many major cases involving terrorist attacks. In his work as an FBI employee, Sachtleben held a Top Secret security clearance and had regular access to classified and national defense information relating to the FBI’s activities, as well as the activities of other members of the U.S. intelligence community.
In 2008, Sachtleben retired from the FBI and was rehired as a contractor. Because of his official responsibilities, he maintained his Top Secret security clearance as an FBI contractor. As a result, he continued to have regular access to classified and national defense information relating to the FBI’s activities, as well as the activities of other members of the U.S. intelligence community. As a contractor, he routinely visited the FBI Lab in Quantico, Va.
One of the criminal charges involves Sachtleben’s contacts with the reporter relating to the disruption of a plot to conduct a suicide bomb attack on a U.S.-bound airliner by the Yemen-based terrorist organization Al-Qaeda in the Arabian Peninsula and the recovery by the United States of a bomb in connection with that plot. As a result of Sachtleben’s disclosure of national defense information to the reporter, the national security of the United States was compromised, a significant international intelligence operation was placed in jeopardy, and lives were put at risk.
Sachtleben was identified as a suspect in the case of this unauthorized disclosure only after toll records for phone numbers related to the reporter were obtained through a subpoena and compared to other evidence collected during the leak investigation. This allowed investigators to obtain a search warrant authorizing a more exhaustive search of Sachtleben’s cell phone, computer, and other electronic media, which were in the possession of federal investigators due to the child pornography investigation.
Sachtleben was employed as an FBI contractor until on or about May 11, 2012. The following day, he was arrested in Indiana and charged by complaint with the federal child pornography charges.
**
Child Pornography Case:
According to a criminal complaint filed in Indiana in May 2012, federal and state investigators became aware of an individual trading images of child pornography online in September 2010. An extensive investigation into that individual led to the arrest of a defendant in Illinois in January 2012. Upon arrest, a forensic search of that defendant’s computer equipment and email accounts allegedly revealed that he had been actively trading the explicit materials online with numerous other people.
Based on that information, law enforcement traced the alleged online activity to Sachtleben’s home in Carmel. After conducting several days of surveillance, a search warrant was executed on May 11, 2012, by law enforcement officers from the Indiana State Police and the FBI Cyber Crime Task Force. Sachtleben was charged in the Southern District of Indiana with possession and distribution of child pornography.
The complaint alleges that an initial forensic examination of Sachtleben’s laptop computer revealed the presence of approximately 30 images and video files containing child pornography. It is alleged that a number of files identified during this initial search matched those that had been found in the course of investigating the Illinois defendant. The complaint further alleges that the laptop’s hard drive contained references to other files known to have been in the possession of the Illinois defendant.
**
A criminal complaint and a criminal information are only charges and are not evidence of guilt. A defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.
**
The national security investigation was conducted by the FBI’s Washington Field Office with assistance from the FBI’s Indianapolis Field Office. The prosecution is being handled by Assistant U.S. Attorneys Jonathan M. Malis and G. Michael Harvey of the U.S. Attorney’s Office for the District of Columbia and Trial Attorney Richard S. Scott of the Counterespionage Section of the Justice Department’s National Security Division. Assistance was provided by Assistant U.S. Attorney Mona N. Sahaf of the U.S. Attorney’s Office for the District of Columbia, and Senior Litigation Counsel Steven D. DeBrota of the U.S. Attorney’s Office for the Southern District of Indiana, who is also prosecuting the child pornography case.
The child pornography investigation 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. Led by United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims.
Monday, September 23, 2013
Former Federal Contractor Petitions to Plead Guilty to Unlawfullly Disclosing National Defense Information and Distributing Child Pornography
Donald John Sachtleben, a former FBI bomb technician who later worked as a government contractor for the agency, has filed a petition to plead guilty to newly filed charges of unlawfully disclosing national defense information relating to a disrupted terrorist plot. Sachtleben previously had filed a petition to plead guilty to charges of possessing and distributing child pornography resulting from a separate investigation.
Sachtleben, 55, of Carmel, Ind., has signed plea agreements in both cases. The documents were filed today in the U.S. District Court for the Southern District of Indiana. Charges in the national security case were filed today, and charges in the child pornography case were filed in May 2012.
The developments were announced by Deputy Attorney General James M. Cole; Ronald C. Machen Jr., U.S. Attorney for the District of Columbia Joseph H. Hogsett, U.S. Attorney for the Southern District of Indiana, and Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office.
The plea agreements signed by the parties would resolve both cases in court proceedings in Indiana. The agreements, which are contingent upon the Court’s approval, call for Sachtleben to plead guilty to the two national security charges as well as the two child pornography offenses. The plea agreements call for Sachtleben to be sentenced to a total of 140 months of incarceration, including a 43-month prison term for the national security offenses and a consecutive 97-month term for the child pornography charges.
The statements of offense related to both the national defense charges and the child pornography charges are attached.
“This unauthorized and unjustifiable disclosure severely jeopardized national security and put lives at risk,” Deputy Attorney General Cole said. “To keep the country safe, the department must enforce the law against such critical and dangerous leaks, while respecting the important role of the press under the department’s media guidelines and any shield law enacted by Congress. I am grateful to the FBI and the U.S. Attorneys’ offices in both Washington, D.C., and Indiana for their excellent and dedicated work on this case.”
“Fifteen months ago, we were given the task of uncovering who had threatened a sensitive intelligence operation and endangered lives by illegally disclosing classified information relating to a disrupted al-Qaeda suicide bomb plot,” said U.S. Attorney Machen. “That plot could not have been more serious, as it targeted a plane bound for the United States. After unprecedented investigative efforts by prosecutors and FBI agents and analysts, today Donald Sachtleben has been charged with this egregious betrayal of our national security. This prosecution demonstrates our deep resolve to hold accountable anyone who would violate their solemn duty to protect our nation’s secrets and to prevent future, potentially devastating leaks by those who would wantonly ignore their obligations to safeguard classified information.”
“The allegations in this case describe the defendant’s repeated violation of a sacred trust that the public had placed in him,” said U.S. Attorney Hogsett. “With these charges, a message has been sent that this type of behavior is completely unacceptable and no person is above the law.”
“Today, Mr. Sachtleben has been charged with knowingly and willfully disclosing national defense information to a member of the media,” said Assistant Director in Charge Parlave. “These charges are the result of a careful and thorough investigation by FBI Special Agents and analysts who, together with federal prosecutors, systematically conducted more than 500 interviews and, following that exhaustive process, analyzed relevant telephone records obtained by subpoena. After analysis of the telephone records, investigators identified him as the source of this unlawful disclosure. The FBI will continue to take all necessary steps to pursue such individuals who put the security of our nation and the lives of others at risk by their disclosure of sensitive information.”
**
National Security Case:
According to a criminal information filed today, on May 2, 2012, nine days before Sachtleben was arrested in Indiana on child pornography charges, Sachtleben knowingly and willfully disclosed national defense information to a reporter for a national news organization not entitled to receive it. The charging document alleges that Sachtleben had reason to believe that this information could be used to the injury of the United States and to the advantage of a foreign nation. The criminal information also charges him with willfully retaining documents relating to the national defense without authorization.
Sachtleben worked for the FBI from 1983 through 2008. During his career, he was a Special Agent Bomb Technician and was assigned to work on many major cases involving terrorist attacks. In his work as an FBI employee, Sachtleben held a Top Secret security clearance and had regular access to classified and national defense information relating to the FBI’s activities, as well as the activities of other members of the U.S. intelligence community.
In 2008, Sachtleben retired from the FBI and was rehired as a contractor. Because of his official responsibilities, he maintained his Top Secret security clearance as an FBI contractor. As a result, he continued to have regular access to classified and national defense information relating to the FBI’s activities, as well as the activities of other members of the U.S. intelligence community. As a contractor, he routinely visited the FBI Lab in Quantico, Va.
One of the criminal charges involves Sachtleben’s contacts with the reporter relating to the disruption of a plot to conduct a suicide bomb attack on a U.S.-bound airliner by the Yemen-based terrorist organization Al-Qaeda in the Arabian Peninsula and the recovery by the United States of a bomb in connection with that plot. As a result of Sachtleben’s disclosure of national defense information to the reporter, the national security of the United States was compromised, a significant international intelligence operation was placed in jeopardy, and lives were put at risk.
Sachtleben was identified as a suspect in the case of this unauthorized disclosure only after toll records for phone numbers related to the reporter were obtained through a subpoena and compared to other evidence collected during the leak investigation. This allowed investigators to obtain a search warrant authorizing a more exhaustive search of Sachtleben’s cell phone, computer, and other electronic media, which were in the possession of federal investigators due to the child pornography investigation.
Sachtleben was employed as an FBI contractor until on or about May 11, 2012. The following day, he was arrested in Indiana and charged by complaint with the federal child pornography charges.
**
Child Pornography Case:
According to a criminal complaint filed in Indiana in May 2012, federal and state investigators became aware of an individual trading images of child pornography online in September 2010. An extensive investigation into that individual led to the arrest of a defendant in Illinois in January 2012. Upon arrest, a forensic search of that defendant’s computer equipment and email accounts allegedly revealed that he had been actively trading the explicit materials online with numerous other people.
Based on that information, law enforcement traced the alleged online activity to Sachtleben’s home in Carmel. After conducting several days of surveillance, a search warrant was executed on May 11, 2012, by law enforcement officers from the Indiana State Police and the FBI Cyber Crime Task Force. Sachtleben was charged in the Southern District of Indiana with possession and distribution of child pornography.
The complaint alleges that an initial forensic examination of Sachtleben’s laptop computer revealed the presence of approximately 30 images and video files containing child pornography. It is alleged that a number of files identified during this initial search matched those that had been found in the course of investigating the Illinois defendant. The complaint further alleges that the laptop’s hard drive contained references to other files known to have been in the possession of the Illinois defendant.
**
A criminal complaint and a criminal information are only charges and are not evidence of guilt. A defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.
**
The national security investigation was conducted by the FBI’s Washington Field Office with assistance from the FBI’s Indianapolis Field Office. The prosecution is being handled by Assistant U.S. Attorneys Jonathan M. Malis and G. Michael Harvey of the U.S. Attorney’s Office for the District of Columbia and Trial Attorney Richard S. Scott of the Counterespionage Section of the Justice Department’s National Security Division. Assistance was provided by Assistant U.S. Attorney Mona N. Sahaf of the U.S. Attorney’s Office for the District of Columbia, and Senior Litigation Counsel Steven D. DeBrota of the U.S. Attorney’s Office for the Southern District of Indiana, who is also prosecuting the child pornography case.
The child pornography investigation 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. Led by United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims.
Wednesday, September 25, 2013
CYBER STALKER PLEADS GUILTY IN "SEXTORTION" CASE
FROM: U.S. JUSTICE DEPARTMENT
Wednesday, September 18, 2013
Maine Resident Pleads Guilty to Engaging in Cyber “Sextortion” of New Hampshire Victim
A Maine resident pleaded guilty today in federal court to engaging in a type of cyberstalking known as “sextortion,” announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and U.S. Attorney John P. Kacavas of the District of New Hampshire.
John Bryan Villegas, 23, of Kittery, Maine, pleaded guilty before U.S. Magistrate Judge Landya B. McCafferty in the District of Maine to a one-count information charging him with interstate stalking.
T he information charges that from July 10-16, 2012, the defendant, while in Kittery, anonymously sent multiple email messages to a New Hampshire resident identified as “Jane Doe.” In those messages, Villegas told Jane Doe that he had “x-rated” photos of her and, as proof, sent her private photos that had been stored on Jane Doe’s stolen laptop computer. Villegas directed Jane Doe to take new photographs and videos of herself engaging in various sexually explicit scenarios and directed her to email the files to him. When she refused, Villegas threatened to “dox” her, meaning that he would “leak” on the Internet the photographs and other personal information about her. Villegas further warned Jane Doe that if she did not provide him with the requested materials, he would send the photographs he already had to individuals throughout New Hampshire, as well as to her ex-husband, boyfriend and a recent former employer.
At sentencing, scheduled for Jan. 7, 2014, Villegas faces a maximum sentence of five years in prison.
The case was investigated by the U.S. Secret Service and is being prosecuted by Assistant U.S. Attorney Arnold H. Huftalen of the District of New Hampshire and Trial Attorney Mona Sedky of the Criminal Division’s Computer Crime and Intellectual Property Section. The police departments of Kittery and Dover, N.H., and the U.S. Naval Criminal Investigative Service provided valuable assistance.
Wednesday, September 18, 2013
Maine Resident Pleads Guilty to Engaging in Cyber “Sextortion” of New Hampshire Victim
A Maine resident pleaded guilty today in federal court to engaging in a type of cyberstalking known as “sextortion,” announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and U.S. Attorney John P. Kacavas of the District of New Hampshire.
John Bryan Villegas, 23, of Kittery, Maine, pleaded guilty before U.S. Magistrate Judge Landya B. McCafferty in the District of Maine to a one-count information charging him with interstate stalking.
T he information charges that from July 10-16, 2012, the defendant, while in Kittery, anonymously sent multiple email messages to a New Hampshire resident identified as “Jane Doe.” In those messages, Villegas told Jane Doe that he had “x-rated” photos of her and, as proof, sent her private photos that had been stored on Jane Doe’s stolen laptop computer. Villegas directed Jane Doe to take new photographs and videos of herself engaging in various sexually explicit scenarios and directed her to email the files to him. When she refused, Villegas threatened to “dox” her, meaning that he would “leak” on the Internet the photographs and other personal information about her. Villegas further warned Jane Doe that if she did not provide him with the requested materials, he would send the photographs he already had to individuals throughout New Hampshire, as well as to her ex-husband, boyfriend and a recent former employer.
At sentencing, scheduled for Jan. 7, 2014, Villegas faces a maximum sentence of five years in prison.
The case was investigated by the U.S. Secret Service and is being prosecuted by Assistant U.S. Attorney Arnold H. Huftalen of the District of New Hampshire and Trial Attorney Mona Sedky of the Criminal Division’s Computer Crime and Intellectual Property Section. The police departments of Kittery and Dover, N.H., and the U.S. Naval Criminal Investigative Service provided valuable assistance.
Tuesday, September 24, 2013
CONSTRUCTION COMPANY OWNER PLEADS GUILTY TO TAX FRAUD
FROM: U.S. JUSTICE DEPARTMENT
Tuesday, September 17, 2013
Owner of New York Construction Company Pleads Guilty to Tax Fraud
Gurmail Singh, a resident of Richmond Hill, N.Y., pleaded guilty today in U.S. District Court in the Eastern District of New York to filing a false federal tax return, the Justice Department and Internal Revenue Service (IRS) announced.
According to the indictment, court records and admissions made by the defendant in court today, Singh used check-cashing services to cash more than $2.9 million in checks paid to his construction company, Fancy and Vicky Construction Co. Inc. in Richmond Hill, for services between 2006 and 2008. He concealed his check-cashing activities from his tax return preparers, and this income was not included as gross income on the company's tax returns. Singh also diverted cash receipts earned by his companies for his own personal use. Singh admitted that his failure to report Fancy and Vicky’s gross receipts caused a tax loss to the IRS of between $400,000 and $1,000,000.
Singh faces a potential maximum sentence of three years in prison and a maximum fine of $250,000. Sentencing is set for Jan. 6, 2014.
The case was investigated by IRS - Criminal Investigation and is being prosecuted by Trial Attorneys Mark Kotila and Jeffrey Bender of the Justice Department's Tax Division.
Tuesday, September 17, 2013
Owner of New York Construction Company Pleads Guilty to Tax Fraud
Gurmail Singh, a resident of Richmond Hill, N.Y., pleaded guilty today in U.S. District Court in the Eastern District of New York to filing a false federal tax return, the Justice Department and Internal Revenue Service (IRS) announced.
According to the indictment, court records and admissions made by the defendant in court today, Singh used check-cashing services to cash more than $2.9 million in checks paid to his construction company, Fancy and Vicky Construction Co. Inc. in Richmond Hill, for services between 2006 and 2008. He concealed his check-cashing activities from his tax return preparers, and this income was not included as gross income on the company's tax returns. Singh also diverted cash receipts earned by his companies for his own personal use. Singh admitted that his failure to report Fancy and Vicky’s gross receipts caused a tax loss to the IRS of between $400,000 and $1,000,000.
Singh faces a potential maximum sentence of three years in prison and a maximum fine of $250,000. Sentencing is set for Jan. 6, 2014.
The case was investigated by IRS - Criminal Investigation and is being prosecuted by Trial Attorneys Mark Kotila and Jeffrey Bender of the Justice Department's Tax Division.
Monday, September 23, 2013
FTC CRACKS DOWN ON MEDICAL DISCOUNT SCAM THAT TARGETED SENIORS
FROM: U.S. FEDERAL TRADE COMMISSION
FTC Cracks Down On Bogus Medical Discount Scam Targeting Seniors
U.S. and Canadian Defendants Charged With Deception and Illegal Telemarketing
The Federal Trade Commission has moved to shut down a medical discount scheme that scammed seniors across the country by offering phony discounts on prescription drugs and pretending to be affiliated with Medicare, Social Security, or medical insurance providers.
In a complaint filed against the operators of the scam in the United States and Canada, the FTC alleges that seniors in the U.S. were targeted by the deceptive calls. The callers convinced their victims to turn over their bank account numbers and used that information to debit money from victims’ accounts.
“This scam, which targeted and deceived our nation’s seniors, is as cynical and wanton as they come,” said Jessica Rich, Director of the FTC’s Bureau of Consumer Protection. “We look forward to bringing this operation to a halt and working to get relief for the victims.”
According to the FTC’s complaint, the telemarketing calls pitched a prescription drug discount card that, victims were told, would provide substantially discounted or even free prescription drugs. Many victims were led to believe they had to purchase the card to continue receiving their Medicare, Social Security, or medical insurance benefits.
In fact, the prescription drug discount cards the defendants provided to consumers are available for free by calling a toll-free number or visiting a website. The cards generally do not provide any discounts to consumers who already have insurance either through a government program or a private insurer.
The scam was run from both sides of the border. The defendants contacted consumers from a telemarketing boiler room in Montreal. The U.S. defendants then used the bank account information consumers provided in the calls to take approximately $300 from consumers’ bank accounts using a “demand draft.” Not all consumers who paid for the purported discount card even received it – some victims received nothing at all for their money.
The defendants are charged with violating Section 5 of the FTC Act by deceptively presenting themselves as government or insurance representatives, as well as by telling consumers that the discount plans they were selling could provide substantial discounts on prescription drugs. In addition, the defendants are charged with violating the FTC’s Telemarketing Sales Rule for their deceptive acts and for calling consumers whose numbers were on the National Do Not Call Registry. A federal judge in the U.S. District Court for the Northern District of Illinois issued a temporary restraining order halting the defendants’ deceptive scheme and freezing their assets.
The U.S.-based defendants in the case include AFD Advisors, LLC, of Wisconsin, which also does business as AFD Medical Advisors; AMG Associates, LLC, of Delaware, which also does business as AMG Medical and AMG Medical Associates; Aaron F. Dupont, individually and as an officer of AFD Advisors and AMG Associates; CAL Consulting, LLC, of Georgia, which also does business as Clinacall; Charles A. Lamborn, III, individually and as an officer of CAL Consulting; and Park 295 Corp, of New York.
The Canadian-based defendants are 9262-2182 Quebec Inc; Stephanie Scebba, individually and as an officer of 9262-2182 Quebec Inc.; 9210-7838 Quebec Inc; and Fawaz Sebal, also known as Frank Sebag, individually and as an officer of 9210-7838 Quebec Inc.
The FTC would like to thank the Canadian Anti-Fraud Centre; Wisconsin Department of Agriculture, Trade and Consumer Protection; Oregon Department of Justice; and Better Business Bureau of Wisconsin for their valuable assistance with this matter.
The FTC also would like to acknowledge the Royal Canadian Mounted Police and the Centre of Operations Linked to Telemarketing Fraud (Project COLT) for their valuable assistance. Launched in 1998, Project COLT combats telemarketing-related crime and includes members of the Royal Canadian Mounted Police, Sureté du Québec, Service de Police de la Ville de Montréal, Canada Border Services Agency, Competition Bureau of Canada, Canada Post, U.S. Department of Homeland Security (U.S. Immigration and Customs Enforcement and the U.S. Secret Service), the U.S. Postal Inspection Service, the Federal Trade Commission, and the Federal Bureau of Investigation. Since its inception, Project COLT has recovered $22 million for victims of telemarketing fraud.
The Commission vote authorizing the staff to file the complaint was 4-0. The complaint was filed in the U.S. District Court for the Northern District of Illinois.
NOTE: The Commission files a complaint when it has “reason to believe” that the law has been or is being violated and it appears to the Commission that a proceeding is in the public interest. The case will be decided by the court.
The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s website provides free information on a variety of consumer topics. Like the FTC on Facebook, follow us on Twitter, and subscribe to press releases for the latest FTC news and resources.
FTC Cracks Down On Bogus Medical Discount Scam Targeting Seniors
U.S. and Canadian Defendants Charged With Deception and Illegal Telemarketing
The Federal Trade Commission has moved to shut down a medical discount scheme that scammed seniors across the country by offering phony discounts on prescription drugs and pretending to be affiliated with Medicare, Social Security, or medical insurance providers.
In a complaint filed against the operators of the scam in the United States and Canada, the FTC alleges that seniors in the U.S. were targeted by the deceptive calls. The callers convinced their victims to turn over their bank account numbers and used that information to debit money from victims’ accounts.
“This scam, which targeted and deceived our nation’s seniors, is as cynical and wanton as they come,” said Jessica Rich, Director of the FTC’s Bureau of Consumer Protection. “We look forward to bringing this operation to a halt and working to get relief for the victims.”
According to the FTC’s complaint, the telemarketing calls pitched a prescription drug discount card that, victims were told, would provide substantially discounted or even free prescription drugs. Many victims were led to believe they had to purchase the card to continue receiving their Medicare, Social Security, or medical insurance benefits.
In fact, the prescription drug discount cards the defendants provided to consumers are available for free by calling a toll-free number or visiting a website. The cards generally do not provide any discounts to consumers who already have insurance either through a government program or a private insurer.
The scam was run from both sides of the border. The defendants contacted consumers from a telemarketing boiler room in Montreal. The U.S. defendants then used the bank account information consumers provided in the calls to take approximately $300 from consumers’ bank accounts using a “demand draft.” Not all consumers who paid for the purported discount card even received it – some victims received nothing at all for their money.
The defendants are charged with violating Section 5 of the FTC Act by deceptively presenting themselves as government or insurance representatives, as well as by telling consumers that the discount plans they were selling could provide substantial discounts on prescription drugs. In addition, the defendants are charged with violating the FTC’s Telemarketing Sales Rule for their deceptive acts and for calling consumers whose numbers were on the National Do Not Call Registry. A federal judge in the U.S. District Court for the Northern District of Illinois issued a temporary restraining order halting the defendants’ deceptive scheme and freezing their assets.
The U.S.-based defendants in the case include AFD Advisors, LLC, of Wisconsin, which also does business as AFD Medical Advisors; AMG Associates, LLC, of Delaware, which also does business as AMG Medical and AMG Medical Associates; Aaron F. Dupont, individually and as an officer of AFD Advisors and AMG Associates; CAL Consulting, LLC, of Georgia, which also does business as Clinacall; Charles A. Lamborn, III, individually and as an officer of CAL Consulting; and Park 295 Corp, of New York.
The Canadian-based defendants are 9262-2182 Quebec Inc; Stephanie Scebba, individually and as an officer of 9262-2182 Quebec Inc.; 9210-7838 Quebec Inc; and Fawaz Sebal, also known as Frank Sebag, individually and as an officer of 9210-7838 Quebec Inc.
The FTC would like to thank the Canadian Anti-Fraud Centre; Wisconsin Department of Agriculture, Trade and Consumer Protection; Oregon Department of Justice; and Better Business Bureau of Wisconsin for their valuable assistance with this matter.
The FTC also would like to acknowledge the Royal Canadian Mounted Police and the Centre of Operations Linked to Telemarketing Fraud (Project COLT) for their valuable assistance. Launched in 1998, Project COLT combats telemarketing-related crime and includes members of the Royal Canadian Mounted Police, Sureté du Québec, Service de Police de la Ville de Montréal, Canada Border Services Agency, Competition Bureau of Canada, Canada Post, U.S. Department of Homeland Security (U.S. Immigration and Customs Enforcement and the U.S. Secret Service), the U.S. Postal Inspection Service, the Federal Trade Commission, and the Federal Bureau of Investigation. Since its inception, Project COLT has recovered $22 million for victims of telemarketing fraud.
The Commission vote authorizing the staff to file the complaint was 4-0. The complaint was filed in the U.S. District Court for the Northern District of Illinois.
NOTE: The Commission files a complaint when it has “reason to believe” that the law has been or is being violated and it appears to the Commission that a proceeding is in the public interest. The case will be decided by the court.
The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s website provides free information on a variety of consumer topics. Like the FTC on Facebook, follow us on Twitter, and subscribe to press releases for the latest FTC news and resources.
Sunday, September 22, 2013
GUILTY PLEA ENTERED BY FORMER REAL ESTATE INVESTOR FOR ROLE IN FORECLOSURE AUCTION FRAUD
FROM: U.S. JUSTICE DEPARTMENT
FORMER ALABAMA REAL ESTATE INVESTOR PLEADS GUILTY
TO MAKING FALSE STATEMENT IN CONNECTION WITH REAL ESTATE FORECLOSURE AUCTION INVESTIGATION
WASHINGTON — A former investor in the Alabama real estate foreclosure auctions industry pleaded guilty today to one count of making false statements, the Department of Justice announced.
Ali Forouzan, of Mobile, Ala., pleaded guilty in the U.S. District Court for the Southern District of Alabama in Mobile to making materially false and fictitious statements to a Special Agent of the FBI and a Department of Justice Antitrust Division prosecutor. The false statements were in regard to his knowledge of, and participation in, bid rigging and other fraudulent schemes in the Alabama real estate foreclosure auction industry.
According to the charge, in February 2012, Forouzan was interviewed, with counsel present, about the fraudulent schemes under investigation. Forouzan was aware of the nature of the investigation and knew that it was material for the FBI and the Antitrust Division to obtain his full knowledge of such unlawful acts as bid-rigging agreements and other fraudulent schemes relating to real estate foreclosure auctions; unlawful payoffs that he and others made and received in furtherance of such schemes; and secret, second auctions in which Forouzan and others participated. However, Forouzan willfully and knowingly provided false and fictitious information during his interview.
“The Antitrust Division views attempts to compromise the integrity of its investigations as a serious offense,” said Bill Baer, Assistant Attorney General in charge of the Department of Justice’s Antitrust Division. “Today’s filing should send a clear signal that the Antitrust Division is committed to prosecuting vigorously attempts to cover-up illegal, anticompetitive conduct.”
“The success of this investigation exemplifies the FBI’s continued commitment to fight fraud in the real estate industry and serves to deter those who wish to illegally profit from fraud schemes,” said Stephen E. Richardson, FBI Special Agent in Charge of the Mobile Field Office. Special Agent in Charge Richardson praised the perseverance of agents and prosecutors in this complex investigation.
Including Forouzan, to date, nine individuals and two companies have pleaded guilty as a result of the department’s ongoing investigation into the Alabama real estate foreclosure auction industry.
Forouzan faces a maximum penalty of five years in prison, three years of supervised release and a $250,000 fine.
The charge against the defendant arose from an ongoing investigation into bid rigging and other fraudulent schemes in the Alabama real estate foreclosure auctions industry. Anyone with information concerning bid rigging or fraud related to public real estate foreclosure auctions should call 404-331-7116 or visit www.justice.gov/atr/contact/newcase.htm.
Today’s charges were brought in connection with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.StopFraud.gov.
FORMER ALABAMA REAL ESTATE INVESTOR PLEADS GUILTY
TO MAKING FALSE STATEMENT IN CONNECTION WITH REAL ESTATE FORECLOSURE AUCTION INVESTIGATION
WASHINGTON — A former investor in the Alabama real estate foreclosure auctions industry pleaded guilty today to one count of making false statements, the Department of Justice announced.
Ali Forouzan, of Mobile, Ala., pleaded guilty in the U.S. District Court for the Southern District of Alabama in Mobile to making materially false and fictitious statements to a Special Agent of the FBI and a Department of Justice Antitrust Division prosecutor. The false statements were in regard to his knowledge of, and participation in, bid rigging and other fraudulent schemes in the Alabama real estate foreclosure auction industry.
According to the charge, in February 2012, Forouzan was interviewed, with counsel present, about the fraudulent schemes under investigation. Forouzan was aware of the nature of the investigation and knew that it was material for the FBI and the Antitrust Division to obtain his full knowledge of such unlawful acts as bid-rigging agreements and other fraudulent schemes relating to real estate foreclosure auctions; unlawful payoffs that he and others made and received in furtherance of such schemes; and secret, second auctions in which Forouzan and others participated. However, Forouzan willfully and knowingly provided false and fictitious information during his interview.
“The Antitrust Division views attempts to compromise the integrity of its investigations as a serious offense,” said Bill Baer, Assistant Attorney General in charge of the Department of Justice’s Antitrust Division. “Today’s filing should send a clear signal that the Antitrust Division is committed to prosecuting vigorously attempts to cover-up illegal, anticompetitive conduct.”
“The success of this investigation exemplifies the FBI’s continued commitment to fight fraud in the real estate industry and serves to deter those who wish to illegally profit from fraud schemes,” said Stephen E. Richardson, FBI Special Agent in Charge of the Mobile Field Office. Special Agent in Charge Richardson praised the perseverance of agents and prosecutors in this complex investigation.
Including Forouzan, to date, nine individuals and two companies have pleaded guilty as a result of the department’s ongoing investigation into the Alabama real estate foreclosure auction industry.
Forouzan faces a maximum penalty of five years in prison, three years of supervised release and a $250,000 fine.
The charge against the defendant arose from an ongoing investigation into bid rigging and other fraudulent schemes in the Alabama real estate foreclosure auctions industry. Anyone with information concerning bid rigging or fraud related to public real estate foreclosure auctions should call 404-331-7116 or visit www.justice.gov/atr/contact/newcase.htm.
Today’s charges were brought in connection with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.StopFraud.gov.
Saturday, September 21, 2013
CORRECTIONS OFFICER SENT TO PRISON FOR OBSTRUCTION OF JUSTICE
FROM: U.S. JUSTICE DEPARTMENT
Monday, September 9, 2013
Former Bernalilo County Corrections Officer Sentenced to Prison for Obstructing Justice
The Justice Department announced today that Kevin Casaus, 24, a former corrections officer at the Bernalillo County Metropolitan Detention Center (MDC) in Albuquerque, N.M., was sentenced this morning to serve 15 months in federal prison followed by one year of supervised release for his conviction on obstruction of justice and falsification of records charges.
Casaus and fellow former MDC corrections officers, Demetrio Juan Gonzales, 41, and Matthew Pendley, 26, were indicted in June 2012, and charged with various crimes related to the Dec. 21, 2011 assault of an inmate housed at MDC, and subsequent attempts to cover up and impede the investigation of the assault.
On March 6, 2013, a federal jury convicted Casaus on obstruction of justice and falsification of records charges, and acquitted him on a related assault charge. According to the evidence at trial, during the early morning hours of Dec. 21, 2011, Gonzales was assigned to the Receiving-Discharge-Transfer (RDT) Unit at MDC where individuals are brought to be booked soon after they are arrested. His job was to photograph and fingerprint those who are brought to RDT for booking. The victim, who had been arrested for driving while intoxicated, was verbally uncooperative during the booking process, but was not a physical threat to anyone. Gonzales, who had previously pleaded guilty, testified that he became angry at the victim and walked him to the shower room where he knew there were no surveillance cameras. Several other corrections officers, including Casaus, followed Gonzales to the shower room. There, Gonzales physically assaulted the victim, striking him multiple times, and choking him. Gonzales testified that he beat the victim “in a blind rage” and then had to wash the victim’s blood off his hands. He further testified that the victim did not do anything to justify the beating.
According to the testimony, Casaus and two other corrections officers were present in the shower room during the beating. Additionally, a former inmate who was in the hallway outside the shower room at the time of the beating, overheard groans and sounds consistent with the assault coming from the shower room. The former inmate was then tasked with cleaning the blood that was on the floors and walls of the shower room. Casaus falsely stated during a recorded interview with a Bernalillo County Sheriff’s Office investigator that the victim was not assaulted in the shower room, the victim was not bleeding and that they only brought the victim to the shower room to ask him to change out of his clothes. Casaus falsified his report when he wrote that he saw blood on the victim's clothes, but did not know where the blood came from.
In October 2012, Gonzales pleaded guilty to violating the civil rights of an individual in his custody when he struck and choked the victim in the shower room/dress out area of MDC and subsequently was sentenced to 33 months in prison followed by three years of supervised release. Pendley pleaded guilty in February 2012 to obstructing justice by making false statements to law enforcement during their investigation of the assault on an inmate and was sentenced to a five year term of probation.
“Law enforcement officers who lie and obstruct justice to cover a fellow officer’s criminal acts do a disservice to the community that they swore to serve and protect,” said Acting Assistant Attorney General for Civil Rights Jocelyn Samuels. “As the prosecution of these three MDC corrections officers demonstrate, the Civil Rights Division, in conjunction with our partners at the U.S. Attorney’s Office and FBI, is committed to holding law enforcement officers accountable when they violate their sworn duty to uphold the Constitution.”
“A correction officer who actively covers up illegal violence perpetrated by another officer re-victimizes a victim, undermines the public’s confidence in the justice system and fosters a belief that correction officer violence perpetrated on inmates will be met with impunity rather than justice,” said Acting U.S. Attorney Steven C. Yarbrough of the District of New Mexico. “Such a culture cannot, and will not, be tolerated.”
“Correctional officers are given tremendous power to enforce the law. When that authority is abused, it's not just the civil rights of prison inmates that are threatened, but the public's trust in our democratic institutions as well,” said Carol K.O. Lee, Special Agent in Charge of the Albuquerque Division of the FBI. “The FBI, as the lead agency for investigating abuses of government officials, places a high priority on these cases. I would like to commend the FBI Special Agents who worked on this case, with the assistance of the U.S. Attorney's Office, the Justice Department's Civil Rights Division, the Bernalillo County Sheriff's Office and the Metropolitan Detention Center's executive management and internal affairs staff.”
This case was investigated by the Albuquerque Division of the FBI and was prosecuted by Assistant U.S. Attorney Mark T. Baker for the District of New Mexico and Trial Attorney Fara Gold of the Civil Rights Division.
Monday, September 9, 2013
Former Bernalilo County Corrections Officer Sentenced to Prison for Obstructing Justice
The Justice Department announced today that Kevin Casaus, 24, a former corrections officer at the Bernalillo County Metropolitan Detention Center (MDC) in Albuquerque, N.M., was sentenced this morning to serve 15 months in federal prison followed by one year of supervised release for his conviction on obstruction of justice and falsification of records charges.
Casaus and fellow former MDC corrections officers, Demetrio Juan Gonzales, 41, and Matthew Pendley, 26, were indicted in June 2012, and charged with various crimes related to the Dec. 21, 2011 assault of an inmate housed at MDC, and subsequent attempts to cover up and impede the investigation of the assault.
On March 6, 2013, a federal jury convicted Casaus on obstruction of justice and falsification of records charges, and acquitted him on a related assault charge. According to the evidence at trial, during the early morning hours of Dec. 21, 2011, Gonzales was assigned to the Receiving-Discharge-Transfer (RDT) Unit at MDC where individuals are brought to be booked soon after they are arrested. His job was to photograph and fingerprint those who are brought to RDT for booking. The victim, who had been arrested for driving while intoxicated, was verbally uncooperative during the booking process, but was not a physical threat to anyone. Gonzales, who had previously pleaded guilty, testified that he became angry at the victim and walked him to the shower room where he knew there were no surveillance cameras. Several other corrections officers, including Casaus, followed Gonzales to the shower room. There, Gonzales physically assaulted the victim, striking him multiple times, and choking him. Gonzales testified that he beat the victim “in a blind rage” and then had to wash the victim’s blood off his hands. He further testified that the victim did not do anything to justify the beating.
According to the testimony, Casaus and two other corrections officers were present in the shower room during the beating. Additionally, a former inmate who was in the hallway outside the shower room at the time of the beating, overheard groans and sounds consistent with the assault coming from the shower room. The former inmate was then tasked with cleaning the blood that was on the floors and walls of the shower room. Casaus falsely stated during a recorded interview with a Bernalillo County Sheriff’s Office investigator that the victim was not assaulted in the shower room, the victim was not bleeding and that they only brought the victim to the shower room to ask him to change out of his clothes. Casaus falsified his report when he wrote that he saw blood on the victim's clothes, but did not know where the blood came from.
In October 2012, Gonzales pleaded guilty to violating the civil rights of an individual in his custody when he struck and choked the victim in the shower room/dress out area of MDC and subsequently was sentenced to 33 months in prison followed by three years of supervised release. Pendley pleaded guilty in February 2012 to obstructing justice by making false statements to law enforcement during their investigation of the assault on an inmate and was sentenced to a five year term of probation.
“Law enforcement officers who lie and obstruct justice to cover a fellow officer’s criminal acts do a disservice to the community that they swore to serve and protect,” said Acting Assistant Attorney General for Civil Rights Jocelyn Samuels. “As the prosecution of these three MDC corrections officers demonstrate, the Civil Rights Division, in conjunction with our partners at the U.S. Attorney’s Office and FBI, is committed to holding law enforcement officers accountable when they violate their sworn duty to uphold the Constitution.”
“A correction officer who actively covers up illegal violence perpetrated by another officer re-victimizes a victim, undermines the public’s confidence in the justice system and fosters a belief that correction officer violence perpetrated on inmates will be met with impunity rather than justice,” said Acting U.S. Attorney Steven C. Yarbrough of the District of New Mexico. “Such a culture cannot, and will not, be tolerated.”
“Correctional officers are given tremendous power to enforce the law. When that authority is abused, it's not just the civil rights of prison inmates that are threatened, but the public's trust in our democratic institutions as well,” said Carol K.O. Lee, Special Agent in Charge of the Albuquerque Division of the FBI. “The FBI, as the lead agency for investigating abuses of government officials, places a high priority on these cases. I would like to commend the FBI Special Agents who worked on this case, with the assistance of the U.S. Attorney's Office, the Justice Department's Civil Rights Division, the Bernalillo County Sheriff's Office and the Metropolitan Detention Center's executive management and internal affairs staff.”
This case was investigated by the Albuquerque Division of the FBI and was prosecuted by Assistant U.S. Attorney Mark T. Baker for the District of New Mexico and Trial Attorney Fara Gold of the Civil Rights Division.
Friday, September 20, 2013
FORMER RYAN INTERNATIONAL AIRLINES EXECUTIVE SENTENCED FOR DEFRAUDING AIRLINE
FROM: U.S. JUSTICE DEPARTMENT
Thursday, September 12, 2013
Former Airline Executive Sentenced to Prison for Schemes to Defraud Illinois-Based Ryan International Airlines
Executive Sentenced to Serve 87 Months in Prison
A former executive of Ryan International Airlines, a charter airline company located in Rockford, Ill., was sentenced today to serve 87 months in prison and to pay restitution for participating in kickback schemes to defraud Ryan, the Department of Justice announced.
Wayne E. Kepple, the former vice president of ground operations for Ryan, was sentenced to serve 87 months in prison and to pay $529,998 in restitution. On Nov. 4, 2011, Kepple pleaded guilty in U.S. District Court in West Palm Beach, Fla., to three counts of conspiracy to commit wire fraud and honest services fraud and three counts of wire fraud. The charges against Kepple stem from a kickback scheme involving Robert A. Riddell, the former owner and operator of an airline security and ground service company, as well as separate kickback schemes involving David A. Chaisson, the former owner and operator of an Indiana flight management services company, James E. Murphy, the former owner and operator of a Florida aviation fuel supply company, and others.
Ryan provided air passenger and cargo services for corporations, private individuals and the U.S. government – including the U.S. Department of Defense and the U.S. Department of Homeland Security.
“Today’s sentence should serve as a stiff deterrent to executives who might be tempted to solicit a kickback from their supplies in exchange for their honest services,” said Bill Baer, Assistant Attorney General in charge of the Antitrust Division. “The Antitrust Division is committed to ensuring that contracts are won based on competition and not collusion.”
According to court documents, Kepple was in charge of contracting with providers of goods and services on behalf of Ryan and approving the invoices submitted by the providers to Ryan for payment. From October 2005 through at least August 2009, Kepple participated in three separate conspiracies in which he received kickback payments of more than $520,000 from Riddell, Murphy, Chaisson and others in exchange for Kepple awarding them Ryan airline services and fuel contracts. According to court documents, the payments from Chaisson and Riddell included the proceeds of fabricated invoices submitted by their companies to Ryan.
As a result of the ongoing investigation, four individuals, including Kepple, have pleaded guilty and been sentenced to prison. On Oct. 28, 2011, Murphy was sentenced to serve 23 months in prison and to pay $42,500 in restitution and Chaisson was sentenced to serve 16 months in prison and to pay $50,742 in restitution. On Jan. 27, 2012, Riddell was sentenced to serve 24 months in prison and to pay $131,540 in restitution. Kepple’s 87-month sentence reflects his central role in multiple kickback schemes.
On Aug. 13, 2013, a fifth individual, Sean E. Wagner, and his company, Aviation Fuel International Inc. (AFI), a Florida-based airline fuel supply company, were indicted for participating in a conspiracy to defraud Ryan by making kickback payments to Kepple in exchange for awarding business to AFI. That case is ongoing.
The investigation is being conducted by the Antitrust Division’s National Criminal Enforcement Section and the U.S. Department of Defense’s Office of Inspector General with assistance from the U.S. Attorney’s Office for the Southern District of Florida.
Thursday, September 12, 2013
Former Airline Executive Sentenced to Prison for Schemes to Defraud Illinois-Based Ryan International Airlines
Executive Sentenced to Serve 87 Months in Prison
A former executive of Ryan International Airlines, a charter airline company located in Rockford, Ill., was sentenced today to serve 87 months in prison and to pay restitution for participating in kickback schemes to defraud Ryan, the Department of Justice announced.
Wayne E. Kepple, the former vice president of ground operations for Ryan, was sentenced to serve 87 months in prison and to pay $529,998 in restitution. On Nov. 4, 2011, Kepple pleaded guilty in U.S. District Court in West Palm Beach, Fla., to three counts of conspiracy to commit wire fraud and honest services fraud and three counts of wire fraud. The charges against Kepple stem from a kickback scheme involving Robert A. Riddell, the former owner and operator of an airline security and ground service company, as well as separate kickback schemes involving David A. Chaisson, the former owner and operator of an Indiana flight management services company, James E. Murphy, the former owner and operator of a Florida aviation fuel supply company, and others.
Ryan provided air passenger and cargo services for corporations, private individuals and the U.S. government – including the U.S. Department of Defense and the U.S. Department of Homeland Security.
“Today’s sentence should serve as a stiff deterrent to executives who might be tempted to solicit a kickback from their supplies in exchange for their honest services,” said Bill Baer, Assistant Attorney General in charge of the Antitrust Division. “The Antitrust Division is committed to ensuring that contracts are won based on competition and not collusion.”
According to court documents, Kepple was in charge of contracting with providers of goods and services on behalf of Ryan and approving the invoices submitted by the providers to Ryan for payment. From October 2005 through at least August 2009, Kepple participated in three separate conspiracies in which he received kickback payments of more than $520,000 from Riddell, Murphy, Chaisson and others in exchange for Kepple awarding them Ryan airline services and fuel contracts. According to court documents, the payments from Chaisson and Riddell included the proceeds of fabricated invoices submitted by their companies to Ryan.
As a result of the ongoing investigation, four individuals, including Kepple, have pleaded guilty and been sentenced to prison. On Oct. 28, 2011, Murphy was sentenced to serve 23 months in prison and to pay $42,500 in restitution and Chaisson was sentenced to serve 16 months in prison and to pay $50,742 in restitution. On Jan. 27, 2012, Riddell was sentenced to serve 24 months in prison and to pay $131,540 in restitution. Kepple’s 87-month sentence reflects his central role in multiple kickback schemes.
On Aug. 13, 2013, a fifth individual, Sean E. Wagner, and his company, Aviation Fuel International Inc. (AFI), a Florida-based airline fuel supply company, were indicted for participating in a conspiracy to defraud Ryan by making kickback payments to Kepple in exchange for awarding business to AFI. That case is ongoing.
The investigation is being conducted by the Antitrust Division’s National Criminal Enforcement Section and the U.S. Department of Defense’s Office of Inspector General with assistance from the U.S. Attorney’s Office for the Southern District of Florida.
Thursday, September 19, 2013
BUSINESSMAN INDICTED FOR FAILURE TO PAY TAXES ON OVER $2 MILLION OF INCOME
FROM: U.S. JUSTICE DEPARTMENT
Thursday, September 12, 2013
Massachusetts Businessman Indicted for Tax Crimes
The Justice Department and Internal Revenue Service (IRS) announced that Richard L. Furnelli, formerly of Holyoke and South Hadley, Mass., was indicted today in Springfield, Mass. Furnelli is charged in a nine-count indictment with one count of obstructing the internal revenue laws, four counts of tax evasion and four counts of failing to file his individual income tax returns.
The indictment alleges that from 1994 to 2009, Furnelli obstructed the IRS’s ability to identify his income and compute the income taxes due and owing by using nominee owners to disguise his ownership interests in a network of businesses and assets, including entities operating an adult entertainment venue called the Gold Club.
The indictment also alleges Furnelli earned over $2 million in total income from 2006 to 2009 and evaded his individual income taxes for that time period by, among other things, directing the payment of his income to the nominee entity, RLF Ventures LLC, utilizing a bank account in the name of a nominee in order to deposit his income and pay his personal expenses, as well as using cash extensively. The indictment further alleges that Furnelli failed to file his individual income tax returns from 2006 to 2009.
Furnelli faces a maximum punishment of three years in prison for the charge of obstructing the internal revenue laws; five years for each count of evading his individual income taxes; and one year for each count of failing to file his individual income tax returns. He faces a maximum fine of $100,000 on each count of failing to file his income tax returns and $250,000 for each of the other counts. An indictment merely alleges that a crime has been committed, and a defendant is presumed innocent until proven guilty beyond a reasonable doubt.
The case was investigated by special agents of the IRS - Criminal Investigation. Tax Division Trial Attorneys Thomas Voracek and Mark McDonald are prosecuting the case.
Thursday, September 12, 2013
Massachusetts Businessman Indicted for Tax Crimes
The Justice Department and Internal Revenue Service (IRS) announced that Richard L. Furnelli, formerly of Holyoke and South Hadley, Mass., was indicted today in Springfield, Mass. Furnelli is charged in a nine-count indictment with one count of obstructing the internal revenue laws, four counts of tax evasion and four counts of failing to file his individual income tax returns.
The indictment alleges that from 1994 to 2009, Furnelli obstructed the IRS’s ability to identify his income and compute the income taxes due and owing by using nominee owners to disguise his ownership interests in a network of businesses and assets, including entities operating an adult entertainment venue called the Gold Club.
The indictment also alleges Furnelli earned over $2 million in total income from 2006 to 2009 and evaded his individual income taxes for that time period by, among other things, directing the payment of his income to the nominee entity, RLF Ventures LLC, utilizing a bank account in the name of a nominee in order to deposit his income and pay his personal expenses, as well as using cash extensively. The indictment further alleges that Furnelli failed to file his individual income tax returns from 2006 to 2009.
Furnelli faces a maximum punishment of three years in prison for the charge of obstructing the internal revenue laws; five years for each count of evading his individual income taxes; and one year for each count of failing to file his individual income tax returns. He faces a maximum fine of $100,000 on each count of failing to file his income tax returns and $250,000 for each of the other counts. An indictment merely alleges that a crime has been committed, and a defendant is presumed innocent until proven guilty beyond a reasonable doubt.
The case was investigated by special agents of the IRS - Criminal Investigation. Tax Division Trial Attorneys Thomas Voracek and Mark McDonald are prosecuting the case.
Wednesday, September 18, 2013
FORMER MAYOR PLEADS GUILTY TO CONDUCTING ILLEGAL GAMBLING BUSINESS
FROM: U.S. JUSTICE DEPARTMENT
Thursday, September 12, 2013
Former South Pittsburg, Tenn., Mayor and Co-conspirator Plead Guilty to Conducting Illegal Gambling Business
A former mayor of South Pittsburg, Tenn., and a co-conspirator pleaded guilty today in Chattanooga, Tenn., to conducting an illegal gambling business, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and Special Agent in Charge Kenneth Moore of the FBI’s Knoxville, Tenn., Field Office.
Former South Pittsburg Mayor James Michael Killian, 56, and Robert Barry Cole, 53, both of South Pittsburg, pleaded guilty today before U.S. District Judge Curtis L. Collier in the Eastern District of Tennessee to criminal informations charging them each with one count of conducting an illegal gambling business.
According to court documents, Killian was mayor of South Pittsburg from 2005 until 2012. During that time, Killian conducted a gambling operation that involved video gambling machines located at a convenience store he owned in South Pittsburg. Killian also managed an “outlaw” lottery, in which bettors placed illegal bets on legal state lotteries.
In addition, Killian ran an illegal sports betting ring in partnership with Cole. Cole received sports bets, collected wagers and paid successful bettors their winnings, and Killian and Cole split the proceeds of the operation.
At sentencing, scheduled for Jan. 9, 2013, Killian and Cole both face up to five years in prison and a $250,000 fine. Killian is subject to criminal forfeiture of $38,475, four computers and 12 video gambling machines. Cole is subject to criminal forfeiture of $19,020, a ring appraised at $17,500 and two computers.
This case is being prosecuted by Trial Attorneys Mark Angehr, Barak Cohen and Peter Sprung of the Criminal Division’s Public Integrity Section and is being investigated by the FBI.
Thursday, September 12, 2013
Former South Pittsburg, Tenn., Mayor and Co-conspirator Plead Guilty to Conducting Illegal Gambling Business
A former mayor of South Pittsburg, Tenn., and a co-conspirator pleaded guilty today in Chattanooga, Tenn., to conducting an illegal gambling business, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and Special Agent in Charge Kenneth Moore of the FBI’s Knoxville, Tenn., Field Office.
Former South Pittsburg Mayor James Michael Killian, 56, and Robert Barry Cole, 53, both of South Pittsburg, pleaded guilty today before U.S. District Judge Curtis L. Collier in the Eastern District of Tennessee to criminal informations charging them each with one count of conducting an illegal gambling business.
According to court documents, Killian was mayor of South Pittsburg from 2005 until 2012. During that time, Killian conducted a gambling operation that involved video gambling machines located at a convenience store he owned in South Pittsburg. Killian also managed an “outlaw” lottery, in which bettors placed illegal bets on legal state lotteries.
In addition, Killian ran an illegal sports betting ring in partnership with Cole. Cole received sports bets, collected wagers and paid successful bettors their winnings, and Killian and Cole split the proceeds of the operation.
At sentencing, scheduled for Jan. 9, 2013, Killian and Cole both face up to five years in prison and a $250,000 fine. Killian is subject to criminal forfeiture of $38,475, four computers and 12 video gambling machines. Cole is subject to criminal forfeiture of $19,020, a ring appraised at $17,500 and two computers.
This case is being prosecuted by Trial Attorneys Mark Angehr, Barak Cohen and Peter Sprung of the Criminal Division’s Public Integrity Section and is being investigated by the FBI.
Tuesday, September 17, 2013
DETROIT MEDICARE FRAUD MASTERMIND SENTENCED TO PRISON
FROM: U.S. JUSTICE DEPARTMENT
Thursday, September 12, 2013
Mastermind of $11 Million Detroit Medicare Fraud Scheme Sentenced to 50 Months in Prison
Muhammad Shahab, the mastermind of an almost $11 million Medicare fraud scheme in Detroit, was sentenced today to 50 months in prison.
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney for the Eastern District of Michigan Barbara L. McQuade, Special Agent in Charge Robert D. Foley III of the FBI’s Detroit Field Office and Special Agent in Charge Lamont Pugh III of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) Chicago Regional Office made the announcement.
Shahab, 53, was sentenced by U.S. District Judge Denise Page Hood in the Eastern District of Michigan. In addition to his prison term, Shahab was sentenced to three years of supervised release and was ordered to pay more than $10.8 million in restitution, jointly and severally with his co-defendants.
Shahab pleaded guilty to one count of health care fraud in February 2010. According to information contained in plea documents, Shahab helped finance and establish two Detroit-area home health agencies, Patient Choice Home Healthcare Inc. (Patient Choice) and All American Home Care Inc. (All American). Shahab admitted that while operating or being associated with both home health agencies, he and his co-conspirators billed Medicare for home health visits that never occurred.
Shahab admitted that he and his co-conspirators recruited and paid cash kickbacks and other inducements to Medicare beneficiaries in exchange for the beneficiaries’ Medicare numbers and signatures on documents falsely indicating that they had visited Patient Choice and All American for the purpose of receiving physical or occupational therapy. Shahab admitted that a large number of the beneficiaries were neither homebound nor in need of any physical therapy services.
Shahab also admitted to securing physician referrals for medically unnecessary home health services through the payment of kickbacks to physicians or individuals associated with physicians. Shahab employed several physical therapists and physical therapy assistants to sign medical documentation needed to begin billing for home health care services, including initial payments and payments for each visit to a Medicare beneficiary. Shahab acknowledged that he knew the physical therapists and physical therapy assistants were not actually conducting a large majority of the visits or treating a large majority of the patients, and confessed to billing and receiving payment from Medicare for services not rendered or medically unnecessary services.
Between approximately August 2007 and October 2009, Shahab and his co-conspirators at Patient Choice and All American submitted approximately $10.8 million in claims to the Medicare program for physical and occupational therapy services that were never rendered or were medically unnecessary.
This case was investigated by the FBI, HHS-OIG and the Internal Revenue Service and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Michigan. This case was prosecuted by Deputy Chief Gejaa Gobena, Assistant Chief Catherine Dick and Trial Attorney Niall O’Donnell of the Criminal Division’s Fraud Section.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,500 defendants who have collectively billed the Medicare program for more than $5 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.
Thursday, September 12, 2013
Mastermind of $11 Million Detroit Medicare Fraud Scheme Sentenced to 50 Months in Prison
Muhammad Shahab, the mastermind of an almost $11 million Medicare fraud scheme in Detroit, was sentenced today to 50 months in prison.
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney for the Eastern District of Michigan Barbara L. McQuade, Special Agent in Charge Robert D. Foley III of the FBI’s Detroit Field Office and Special Agent in Charge Lamont Pugh III of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) Chicago Regional Office made the announcement.
Shahab, 53, was sentenced by U.S. District Judge Denise Page Hood in the Eastern District of Michigan. In addition to his prison term, Shahab was sentenced to three years of supervised release and was ordered to pay more than $10.8 million in restitution, jointly and severally with his co-defendants.
Shahab pleaded guilty to one count of health care fraud in February 2010. According to information contained in plea documents, Shahab helped finance and establish two Detroit-area home health agencies, Patient Choice Home Healthcare Inc. (Patient Choice) and All American Home Care Inc. (All American). Shahab admitted that while operating or being associated with both home health agencies, he and his co-conspirators billed Medicare for home health visits that never occurred.
Shahab admitted that he and his co-conspirators recruited and paid cash kickbacks and other inducements to Medicare beneficiaries in exchange for the beneficiaries’ Medicare numbers and signatures on documents falsely indicating that they had visited Patient Choice and All American for the purpose of receiving physical or occupational therapy. Shahab admitted that a large number of the beneficiaries were neither homebound nor in need of any physical therapy services.
Shahab also admitted to securing physician referrals for medically unnecessary home health services through the payment of kickbacks to physicians or individuals associated with physicians. Shahab employed several physical therapists and physical therapy assistants to sign medical documentation needed to begin billing for home health care services, including initial payments and payments for each visit to a Medicare beneficiary. Shahab acknowledged that he knew the physical therapists and physical therapy assistants were not actually conducting a large majority of the visits or treating a large majority of the patients, and confessed to billing and receiving payment from Medicare for services not rendered or medically unnecessary services.
Between approximately August 2007 and October 2009, Shahab and his co-conspirators at Patient Choice and All American submitted approximately $10.8 million in claims to the Medicare program for physical and occupational therapy services that were never rendered or were medically unnecessary.
This case was investigated by the FBI, HHS-OIG and the Internal Revenue Service and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Michigan. This case was prosecuted by Deputy Chief Gejaa Gobena, Assistant Chief Catherine Dick and Trial Attorney Niall O’Donnell of the Criminal Division’s Fraud Section.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,500 defendants who have collectively billed the Medicare program for more than $5 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.
Monday, September 16, 2013
FBI SEEKS INFORMATION ON WASHINGTON NAVY YARD SHOOTER
FROM: FBI
INFORMATION SOUGHT BY FBI
Aaron Alexis, deceased, is believed to be responsible for the shootings at the Washington Navy Yard, in the Southeast area of Washington, DC, around 8:20 a.m. on September 16, 2013. The FBI is asking for the public's assistance with any information regarding Alexis.
If you have any information concerning this individual, please contact the FBI's Washington, DC Field Office at 202/278-2000 or 1-800-CALL-FBI.
Navy Yard Shooting
Washington, DC
AARON ALEXIS - DECEASED
Subject Image Subject Image
Photograph taken in 2011
Multimedia: Images
DESCRIPTION
Date(s) of Birth Used:
May 9, 1979
Place of Birth: Queens, New York
Height: 6'1"
Weight: 190 pounds
Hair: Black
Eyes: Brown
Sex: Male
Race: Black
Remarks: Alexis was last known to reside in Fort Worth, Texas.
TWO GO TO PRISON FOR PARTICIPATION IN $1.5 MILLION MEDICARE FRAUD
FROM: U.S. JUSTICE DEPARTMENT
Tuesday, September 10, 2013
Medical Supply Company Officer and Southern California Physician Sentenced for $1.5 Million Medicare Fraud
A former officer of Fendih Medical Supply Inc. was sentenced to serve 51 months in prison yesterday in Los Angeles for his role in a fraud scheme that resulted in $1.5 million in fraudulent claims to Medicare. In addition, a physician was sentenced to 27 months in prison for his role in the scheme.
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney André Birotte Jr. of the Central District of California, Special Agent in Charge Glenn R. Ferry of the Los Angeles Region of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) and Assistant Director in Charge Bill L. Lewis of the FBI’s Los Angeles Field Office made the announcement.
Godwin Onyeabor, 49, of San Bernandino, Calif., was sentenced on Sept. 9, 2013, by U.S. District Judge Manuel L. Real in the Central District of California to 51 months in prison. In addition to his prison term, Onyeabor was sentenced to three years of supervised release. Restitution will be determined at a later date. Dr. Sri J. Wijegunaratne, 58, of Anaheim, Calif., was sentenced to 27 months in prison by Judge Real. In addition to his prison term, Wijegunaratne was sentenced to three years of supervised release and ordered to pay restitution in the amount of $87,846.
On April 24, 2013, a jury in Los Angeles federal court found Wijegunaratne, Onyeabor and Heidi Morishita, 48, guilty of one count of conspiracy to pay and receive kickbacks. In addition, Wijegunaratne and Onyeabor were found guilty of conspiracy to commit health care fraud. Wijegunaratne was found guilty of seven counts of health care fraud, and Onyeabor was found guilty of eleven counts of health care fraud.
During trial, the evidence showed that Onyeabor, as the former officer of a durable medical equipment (DME) supply company, fraudulently billed more than $1 million to Medicare for DME that was either never provided to its Medicare beneficiaries or was not medically necessary. Wijegunaratne provided Onyeabor and others with medically unnecessary power wheelchair prescriptions, and both Wijegunaratne and Morishita sold power wheelchair prescriptions to Onyeabor and others.
The evidence showed that Onyeabor and others paid Wijegunaratne and Morishita cash kickbacks for fraudulent prescriptions for DME, and Onyeabor and others used these prescriptions to bill Medicare for the power wheelchairs and other DME. Several Medicare beneficiaries testified that they were lured to medical clinics with the promise of free items such as vitamins and juice, only to receive power wheelchairs which they did not need and did not want, and were unsuccessful in their attempts to reject delivery of the power wheelchairs from Onyeabor’s supply company.
As a result of this fraud scheme, Onyeabor, Wijegunaratne and others submitted and caused the submission of approximately $1.5 million in false and fraudulent claims to Medicare and received almost $1 million on those claims.
Morishita’s sentencing is scheduled for Sept. 30, 2013.
The case is being investigated by the FBI and the Los Angeles Region of the HHS-Office of Inspector General (HHS-OIG) and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Central District of California. The case is being prosecuted by Assistant Chief Benton Curtis, Trial Attorneys Fred Medick and Alexander Porter of the Criminal Division’s Fraud Section.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,500 defendants who have collectively billed the Medicare program for more than $5 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
Tuesday, September 10, 2013
Medical Supply Company Officer and Southern California Physician Sentenced for $1.5 Million Medicare Fraud
A former officer of Fendih Medical Supply Inc. was sentenced to serve 51 months in prison yesterday in Los Angeles for his role in a fraud scheme that resulted in $1.5 million in fraudulent claims to Medicare. In addition, a physician was sentenced to 27 months in prison for his role in the scheme.
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney André Birotte Jr. of the Central District of California, Special Agent in Charge Glenn R. Ferry of the Los Angeles Region of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) and Assistant Director in Charge Bill L. Lewis of the FBI’s Los Angeles Field Office made the announcement.
Godwin Onyeabor, 49, of San Bernandino, Calif., was sentenced on Sept. 9, 2013, by U.S. District Judge Manuel L. Real in the Central District of California to 51 months in prison. In addition to his prison term, Onyeabor was sentenced to three years of supervised release. Restitution will be determined at a later date. Dr. Sri J. Wijegunaratne, 58, of Anaheim, Calif., was sentenced to 27 months in prison by Judge Real. In addition to his prison term, Wijegunaratne was sentenced to three years of supervised release and ordered to pay restitution in the amount of $87,846.
On April 24, 2013, a jury in Los Angeles federal court found Wijegunaratne, Onyeabor and Heidi Morishita, 48, guilty of one count of conspiracy to pay and receive kickbacks. In addition, Wijegunaratne and Onyeabor were found guilty of conspiracy to commit health care fraud. Wijegunaratne was found guilty of seven counts of health care fraud, and Onyeabor was found guilty of eleven counts of health care fraud.
During trial, the evidence showed that Onyeabor, as the former officer of a durable medical equipment (DME) supply company, fraudulently billed more than $1 million to Medicare for DME that was either never provided to its Medicare beneficiaries or was not medically necessary. Wijegunaratne provided Onyeabor and others with medically unnecessary power wheelchair prescriptions, and both Wijegunaratne and Morishita sold power wheelchair prescriptions to Onyeabor and others.
The evidence showed that Onyeabor and others paid Wijegunaratne and Morishita cash kickbacks for fraudulent prescriptions for DME, and Onyeabor and others used these prescriptions to bill Medicare for the power wheelchairs and other DME. Several Medicare beneficiaries testified that they were lured to medical clinics with the promise of free items such as vitamins and juice, only to receive power wheelchairs which they did not need and did not want, and were unsuccessful in their attempts to reject delivery of the power wheelchairs from Onyeabor’s supply company.
As a result of this fraud scheme, Onyeabor, Wijegunaratne and others submitted and caused the submission of approximately $1.5 million in false and fraudulent claims to Medicare and received almost $1 million on those claims.
Morishita’s sentencing is scheduled for Sept. 30, 2013.
The case is being investigated by the FBI and the Los Angeles Region of the HHS-Office of Inspector General (HHS-OIG) and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Central District of California. The case is being prosecuted by Assistant Chief Benton Curtis, Trial Attorneys Fred Medick and Alexander Porter of the Criminal Division’s Fraud Section.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,500 defendants who have collectively billed the Medicare program for more than $5 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
Sunday, September 15, 2013
DECEPTIVE CREDIT CARD RATE-REDUCTION ROBOCALLERS SHUT DOWN IN FTC SETTLEMENTS
FROM: FEDERAL TRADE COMMISSION
Deceptive Robocallers Permanently Shut Down In FTC Settlements
Companies Behind Credit Card Rate-Reduction Scams Will Be Banned From Telemarketing, Robocalling
The Federal Trade Commission has continued its crackdown on illegal robocallers, with two more companies agreeing to settle charges that they used prerecorded calls to trick consumers into deceptive credit card interest rate reduction scams.
Under separate proposed settlements, the defendants behind Treasure Your Success and Ambrosia Web Design will be banned from telemarketing and delivering robocalls. They also will be permanently prohibited from advertising, marketing, promoting, or offering for sale any debt relief product or service, or assisting others in doing so.
The FTC filed the initial cases against the operators of both companies in 2012 as part of a joint-agency crackdown on companies and individuals responsible for making millions of illegal “Rachel” robocalls pitching credit card rate-reduction services.
Treasure Your Success
In its original complaint against Treasure Your Success, the FTC alleged that the defendants tricked consumers into paying up-front fees for as much as $1,593, using deceptive offers for credit card interest rate reduction services.
The complaint named two individuals, Willy Plancher and Valbona Toska, as well as their three companies, WV Universal Management, Global Financial Assist, and Leading Production. The defendants began marketing credit card interest rate reduction services in 2010. According to the FTC’s complaint, the defendants lured consumers by telling them they could substantially reduce their credit card interest rates, down to as low as three percent, in many instances. After collecting the upfront fees, however, consumers typically failed to get any interest rate reduction or any savings at all.
In November 2012, at the FTC’s request, a federal court halted the scheme and froze the defendants’ assets pending further court proceedings. The FTC subsequently amended its complaint to include new defendants and additional counts.
In addition to the other provisions of the settlement, the proposed order holds the defendants liable for $2,032,626, based on the amount of consumer injury in the case. Due to the inability of the individual defendants to pay redress, the monetary judgment has been suspended. However, if the defendants misstate or fail to disclose any of their material assets, the full amount of the judgment will be immediately due and payable.
The case against Treasure Your Success was filed in the U.S. District Court for the Middle District of Florida, Orlando Division. Litigation continues against: HES Merchant Services Company, Business First Solutions, VoiceOnyx Corp., Hal E. Smith, Jonathon E. Warren, Ramon Sanchez-Ortega, Universal Processing Services of Wisconsin, and Derek Depuydt.
Ambrosia Web Design
According to the FTC’s complaint, the Ambrosia Web Design defendants delivered prerecorded calls that urged consumers they called to “press one” if they were interested in credit card interest rate reduction services. Consumers who pressed one were connected to a telemarketer who promised to get them very low interest rates or, in some cases, specific amounts of interest savings. The defendants often deceived consumers into thinking defendants were affiliated with a government program. If consumers agreed to sign up, the telemarketer got their credit card information, often charging an illegal advance fee before providing any service, the FTC alleged.
The FTC alleged that defendants then typically failed to deliver on their promises. In addition, the FTC charged defendants with failing to disclose their purported no-refund/no cancellation policy and billing some consumers without their express authorization. Finally, the FTC alleged defendants illegally called many phone numbers on the National Do Not Call Registry.
In June 2013, the FTC amended its original complaint to add charges of credit card laundering in violation of the agency’s Telemarketing Sales Rule. According to the FTC, in many cases, the defendants laundered credit card payments by processing them for other telemarketers through the Ambrosia defendants’ own merchant accounts; and arranging for other merchants to process credit card payments for the defendants through their accounts.
In addition to the bans on outbound telemarketing and robocalling, the proposed settlement order:
Bans the defendants from using certain payment processing methods, such as remotely created checks, that are often used to conduct fraud;
Prohibits the defendants from making misrepresentations regarding any “financial products or services;” and Prohibits the defendants from misrepresenting the efficacy of a product or service.
The proposed settlement requires the defendants to liquidate virtually all of their assets, including a valuable watch and a sports memorabilia collection. It also includes a judgment of $8.3 million, which will be suspended if defendants comply with the terms of the settlement.
The settlement resolves the FTC’s charges against: 1) Ambrosia Web Design, LLC, also doing business as AWD; 2) Concord Financial Advisors LLC; 3) CAM Services Direct LLC; 4) AFB LLC; 5) Western GPS LLC; 6) Chris Ambrosia, individually and as a manager of Ambrosia Web Design LLC and CAM Services Direct LLC; and 6) LeRoy Castine, also known as Lee Castine, individually and as a manager of Ambrosia Web Design LLC, Concord Financial Advisors LLC, AFB LLC, and Western GPS LLC.
The case against Ambrosia Web Design was filed in the U.S. District Court for the District of Arizona.
The Commission vote approving the proposed settlements in both actions was 4-0.
Information for Consumers
The FTC has tips for consumers, as well as two new consumer education videos explaining robocalls and describing what consumers should do when they receive one. See ftc.gov/robocalls for more information.
Deceptive Robocallers Permanently Shut Down In FTC Settlements
Companies Behind Credit Card Rate-Reduction Scams Will Be Banned From Telemarketing, Robocalling
The Federal Trade Commission has continued its crackdown on illegal robocallers, with two more companies agreeing to settle charges that they used prerecorded calls to trick consumers into deceptive credit card interest rate reduction scams.
Under separate proposed settlements, the defendants behind Treasure Your Success and Ambrosia Web Design will be banned from telemarketing and delivering robocalls. They also will be permanently prohibited from advertising, marketing, promoting, or offering for sale any debt relief product or service, or assisting others in doing so.
The FTC filed the initial cases against the operators of both companies in 2012 as part of a joint-agency crackdown on companies and individuals responsible for making millions of illegal “Rachel” robocalls pitching credit card rate-reduction services.
Treasure Your Success
In its original complaint against Treasure Your Success, the FTC alleged that the defendants tricked consumers into paying up-front fees for as much as $1,593, using deceptive offers for credit card interest rate reduction services.
The complaint named two individuals, Willy Plancher and Valbona Toska, as well as their three companies, WV Universal Management, Global Financial Assist, and Leading Production. The defendants began marketing credit card interest rate reduction services in 2010. According to the FTC’s complaint, the defendants lured consumers by telling them they could substantially reduce their credit card interest rates, down to as low as three percent, in many instances. After collecting the upfront fees, however, consumers typically failed to get any interest rate reduction or any savings at all.
In November 2012, at the FTC’s request, a federal court halted the scheme and froze the defendants’ assets pending further court proceedings. The FTC subsequently amended its complaint to include new defendants and additional counts.
In addition to the other provisions of the settlement, the proposed order holds the defendants liable for $2,032,626, based on the amount of consumer injury in the case. Due to the inability of the individual defendants to pay redress, the monetary judgment has been suspended. However, if the defendants misstate or fail to disclose any of their material assets, the full amount of the judgment will be immediately due and payable.
The case against Treasure Your Success was filed in the U.S. District Court for the Middle District of Florida, Orlando Division. Litigation continues against: HES Merchant Services Company, Business First Solutions, VoiceOnyx Corp., Hal E. Smith, Jonathon E. Warren, Ramon Sanchez-Ortega, Universal Processing Services of Wisconsin, and Derek Depuydt.
Ambrosia Web Design
According to the FTC’s complaint, the Ambrosia Web Design defendants delivered prerecorded calls that urged consumers they called to “press one” if they were interested in credit card interest rate reduction services. Consumers who pressed one were connected to a telemarketer who promised to get them very low interest rates or, in some cases, specific amounts of interest savings. The defendants often deceived consumers into thinking defendants were affiliated with a government program. If consumers agreed to sign up, the telemarketer got their credit card information, often charging an illegal advance fee before providing any service, the FTC alleged.
The FTC alleged that defendants then typically failed to deliver on their promises. In addition, the FTC charged defendants with failing to disclose their purported no-refund/no cancellation policy and billing some consumers without their express authorization. Finally, the FTC alleged defendants illegally called many phone numbers on the National Do Not Call Registry.
In June 2013, the FTC amended its original complaint to add charges of credit card laundering in violation of the agency’s Telemarketing Sales Rule. According to the FTC, in many cases, the defendants laundered credit card payments by processing them for other telemarketers through the Ambrosia defendants’ own merchant accounts; and arranging for other merchants to process credit card payments for the defendants through their accounts.
In addition to the bans on outbound telemarketing and robocalling, the proposed settlement order:
Bans the defendants from using certain payment processing methods, such as remotely created checks, that are often used to conduct fraud;
Prohibits the defendants from making misrepresentations regarding any “financial products or services;” and Prohibits the defendants from misrepresenting the efficacy of a product or service.
The proposed settlement requires the defendants to liquidate virtually all of their assets, including a valuable watch and a sports memorabilia collection. It also includes a judgment of $8.3 million, which will be suspended if defendants comply with the terms of the settlement.
The settlement resolves the FTC’s charges against: 1) Ambrosia Web Design, LLC, also doing business as AWD; 2) Concord Financial Advisors LLC; 3) CAM Services Direct LLC; 4) AFB LLC; 5) Western GPS LLC; 6) Chris Ambrosia, individually and as a manager of Ambrosia Web Design LLC and CAM Services Direct LLC; and 6) LeRoy Castine, also known as Lee Castine, individually and as a manager of Ambrosia Web Design LLC, Concord Financial Advisors LLC, AFB LLC, and Western GPS LLC.
The case against Ambrosia Web Design was filed in the U.S. District Court for the District of Arizona.
The Commission vote approving the proposed settlements in both actions was 4-0.
Information for Consumers
The FTC has tips for consumers, as well as two new consumer education videos explaining robocalls and describing what consumers should do when they receive one. See ftc.gov/robocalls for more information.
Saturday, September 14, 2013
ARYAN BROTHERHOOD OF TEXAS GANG MEMBER PLEADS GUILTY TO RACKETEERING
FROM: U.S. JUSTICE DEPARTMENT
Monday, September 9, 2013
Aryan Brotherhood of Texas Gang Member Pleads Guilty to Federal Racketeering Charges
A member of the Aryan Brotherhood of Texas (ABT) gang pleaded guilty today to racketeering charges related to his membership in the ABT’s criminal enterprise, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and U.S. Attorney Kenneth Magidson of the Southern District of Texas.
Benjamin Troy Johnson, aka “South,” 42, of Corpus Christi, Texas, pleaded guilty before U.S. District Judge Sim Lake in the Southern District of Texas to one count of conspiracy to participate in racketeering activity.
According to court documents, Johnson and other ABT gang members and associates agreed to commit multiple acts of murder, robbery, arson, kidnapping and narcotics trafficking on behalf of the ABT gang. Johnson and numerous ABT gang members met on a regular basis at various locations throughout Texas to report on gang-related business, collect dues, commit disciplinary assaults against fellow gang members and discuss acts of violence against rival gang members, among other things.
By pleading guilty to racketeering charges, Johnson has admitted to being a member of the ABT criminal enterprise.
According to the superseding indictment, the ABT was established in the early 1980s within the Texas prison system. The gang modeled itself after and adopted many of the precepts and writings of the Aryan Brotherhood, a California-based prison gang that was formed in the California prison system during the 1960s. According to the superseding indictment, previously, the ABT was primarily concerned with the protection of white inmates and the promotion of white supremacy/separatism. Over time, the ABT expanded its criminal enterprise to include illegal activities for profit.
Court documents allege that the ABT enforced its rules and promoted discipline among its members, prospects and associates through murder, attempted murder, conspiracy to commit murder, arson, assault, robbery and threats against those who violated the rules or posed a threat to the enterprise. Members, and oftentimes associates, were required to follow the orders of higher-ranking members, often referred to as “direct orders.”
According to the superseding indictment, in order to be considered for ABT membership, a person must be sponsored by another gang member. Once sponsored, a prospective member must serve an unspecified term, during which he is referred to as a prospect while his conduct is observed by the members of the ABT.
Judge Lake has set sentencing for Jan. 30, 2013, at which time Johnson faces a maximum penalty of life in prison.
Johnson is one of 36 defendants charged with, among other things, conducting racketeering activity through the ABT criminal enterprise. He is the 13th defendant charged in the indictment to plead guilty.
This case is being investigated by a multi-agency task force consisting of the Bureau of Alcohol, Tobacco, Firearms and Explosives; Drug Enforcement Administration; FBI; U.S. Marshals Service; Federal Bureau of Prisons; U.S. Immigration and Customs Enforcement -Homeland Security Investigations; Texas Rangers; Texas Department of Public Safety; Montgomery County, Texas, Sheriff’s Office; Houston Police Department-Gang Division; Texas Department of Criminal Justice – Office of Inspector General; Harris County, Texas, Sheriff’s Office; Tarrant County, Texas, Sheriff’s Office; Atascosa County, Texas, Sheriff’s Office; Waller County, Texas, Sheriff’s Office; Alvin, Texas, Police Department; Carrollton, Texas, Police Department; Mesquite Texas, Police Department; Montgomery County District Attorney’s Office; and the Atascosa County District Attorney’s Office.
Monday, September 9, 2013
Aryan Brotherhood of Texas Gang Member Pleads Guilty to Federal Racketeering Charges
A member of the Aryan Brotherhood of Texas (ABT) gang pleaded guilty today to racketeering charges related to his membership in the ABT’s criminal enterprise, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and U.S. Attorney Kenneth Magidson of the Southern District of Texas.
Benjamin Troy Johnson, aka “South,” 42, of Corpus Christi, Texas, pleaded guilty before U.S. District Judge Sim Lake in the Southern District of Texas to one count of conspiracy to participate in racketeering activity.
According to court documents, Johnson and other ABT gang members and associates agreed to commit multiple acts of murder, robbery, arson, kidnapping and narcotics trafficking on behalf of the ABT gang. Johnson and numerous ABT gang members met on a regular basis at various locations throughout Texas to report on gang-related business, collect dues, commit disciplinary assaults against fellow gang members and discuss acts of violence against rival gang members, among other things.
By pleading guilty to racketeering charges, Johnson has admitted to being a member of the ABT criminal enterprise.
According to the superseding indictment, the ABT was established in the early 1980s within the Texas prison system. The gang modeled itself after and adopted many of the precepts and writings of the Aryan Brotherhood, a California-based prison gang that was formed in the California prison system during the 1960s. According to the superseding indictment, previously, the ABT was primarily concerned with the protection of white inmates and the promotion of white supremacy/separatism. Over time, the ABT expanded its criminal enterprise to include illegal activities for profit.
Court documents allege that the ABT enforced its rules and promoted discipline among its members, prospects and associates through murder, attempted murder, conspiracy to commit murder, arson, assault, robbery and threats against those who violated the rules or posed a threat to the enterprise. Members, and oftentimes associates, were required to follow the orders of higher-ranking members, often referred to as “direct orders.”
According to the superseding indictment, in order to be considered for ABT membership, a person must be sponsored by another gang member. Once sponsored, a prospective member must serve an unspecified term, during which he is referred to as a prospect while his conduct is observed by the members of the ABT.
Judge Lake has set sentencing for Jan. 30, 2013, at which time Johnson faces a maximum penalty of life in prison.
Johnson is one of 36 defendants charged with, among other things, conducting racketeering activity through the ABT criminal enterprise. He is the 13th defendant charged in the indictment to plead guilty.
This case is being investigated by a multi-agency task force consisting of the Bureau of Alcohol, Tobacco, Firearms and Explosives; Drug Enforcement Administration; FBI; U.S. Marshals Service; Federal Bureau of Prisons; U.S. Immigration and Customs Enforcement -Homeland Security Investigations; Texas Rangers; Texas Department of Public Safety; Montgomery County, Texas, Sheriff’s Office; Houston Police Department-Gang Division; Texas Department of Criminal Justice – Office of Inspector General; Harris County, Texas, Sheriff’s Office; Tarrant County, Texas, Sheriff’s Office; Atascosa County, Texas, Sheriff’s Office; Waller County, Texas, Sheriff’s Office; Alvin, Texas, Police Department; Carrollton, Texas, Police Department; Mesquite Texas, Police Department; Montgomery County District Attorney’s Office; and the Atascosa County District Attorney’s Office.
Friday, September 13, 2013
NEW SMARTPHONE APP LAUNCHED TO FIND PREDATORS AND RESCUE EXPLOITED CHILDREN
FROM: U.S. DEPARTMENT OF HOMELAND SECURITY
ICE launches smartphone app to locate predators, rescue children from sexual abuse and exploitation
WASHINGTON — U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI) is launching a new smartphone app – the first of its kind in U.S. federal law enforcement – designed to seek the public's help with fugitive and unknown suspect child predators. All tips can be reported anonymously through the app, by phone or online, 24 hours a day, seven days a week.
The most urgent case involves an unidentified man wanted for producing child pornography involving the sexual abuse of a 10 to 12-year-old girl. This "John Doe" is an unknown suspect and is believed to be living somewhere in the United States or Canada, but he could be anywhere in the world. The first video file was discovered by Interpol and submitted to the National Center for Missing & Exploited Children in 2006. The full series was last seen by HSI special agents in Los Angeles in 2013 during execution of a search warrant. The four videos show the prepubescent girl being sexually abused by an adult male with short brown hair and blue eyes. In the videos, the offender has a full beard and wears glasses. Both he and the child are seen in a room with wood paneled walls with framed photos, a black computer, desk with sewing machine and brown patterned curtains.
In addition to profiling John Doe cases like this, the new smartphone app contains photos and information about known fugitives in HSI criminal cases involving sexually abused and exploited children.
"When children are being sexually abused and exploited, it's a race against the clock to rescue the child and bring the predator to justice," said ICE Acting Director John Sandweg. "These investigations are one of our highest priorities, and in today's world, we need to be technologically savvy and innovative in our approach."
ICE's Office of Public Affairs developed the app with special agents from HSI's Cyber Crimes Center (C3) and field offices across the country in order to seek the public's help with information about child predators wanted for criminal prosecution.
"The creation and launch of this application provides ICE another useful tool to reach the public," said ICE Director of Public Affairs Brian Hale. "We recognize that people receive a great deal of information on their mobile devices and we are hopeful that this app will encourage them to submit tips about suspects and to learn more about our work investigating child exploitation crimes."
The Operation Predator App enables those who download it to receive alerts about wanted predators, to share the information with friends via email and social media tools, and to provide information to HSI by calling or submitting an online tip. Additionally, the app enables users to view news about arrests and prosecutions of child predators and additional resources about ICE and its global partners in the fight against child exploitation.
Currently, the app can be downloaded from Apple's App Store or iTunes. ICE is also planning to expand compatibility to other smartphones in the near future.
HSI is requesting that anyone with information about John Doe or the other fugitives profiled to contact the agency in one of two ways: Call the ICE Tip Line, which is staffed 24-hours a day: (866) 347-2423 from the U.S. & Canada or (802) 872-6199 from anywhere in the world, or complete an online tip form at www.ice.gov/tips/.
ICE launches smartphone app to locate predators, rescue children from sexual abuse and exploitation
WASHINGTON — U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI) is launching a new smartphone app – the first of its kind in U.S. federal law enforcement – designed to seek the public's help with fugitive and unknown suspect child predators. All tips can be reported anonymously through the app, by phone or online, 24 hours a day, seven days a week.
The most urgent case involves an unidentified man wanted for producing child pornography involving the sexual abuse of a 10 to 12-year-old girl. This "John Doe" is an unknown suspect and is believed to be living somewhere in the United States or Canada, but he could be anywhere in the world. The first video file was discovered by Interpol and submitted to the National Center for Missing & Exploited Children in 2006. The full series was last seen by HSI special agents in Los Angeles in 2013 during execution of a search warrant. The four videos show the prepubescent girl being sexually abused by an adult male with short brown hair and blue eyes. In the videos, the offender has a full beard and wears glasses. Both he and the child are seen in a room with wood paneled walls with framed photos, a black computer, desk with sewing machine and brown patterned curtains.
In addition to profiling John Doe cases like this, the new smartphone app contains photos and information about known fugitives in HSI criminal cases involving sexually abused and exploited children.
"When children are being sexually abused and exploited, it's a race against the clock to rescue the child and bring the predator to justice," said ICE Acting Director John Sandweg. "These investigations are one of our highest priorities, and in today's world, we need to be technologically savvy and innovative in our approach."
ICE's Office of Public Affairs developed the app with special agents from HSI's Cyber Crimes Center (C3) and field offices across the country in order to seek the public's help with information about child predators wanted for criminal prosecution.
"The creation and launch of this application provides ICE another useful tool to reach the public," said ICE Director of Public Affairs Brian Hale. "We recognize that people receive a great deal of information on their mobile devices and we are hopeful that this app will encourage them to submit tips about suspects and to learn more about our work investigating child exploitation crimes."
The Operation Predator App enables those who download it to receive alerts about wanted predators, to share the information with friends via email and social media tools, and to provide information to HSI by calling or submitting an online tip. Additionally, the app enables users to view news about arrests and prosecutions of child predators and additional resources about ICE and its global partners in the fight against child exploitation.
Currently, the app can be downloaded from Apple's App Store or iTunes. ICE is also planning to expand compatibility to other smartphones in the near future.
HSI is requesting that anyone with information about John Doe or the other fugitives profiled to contact the agency in one of two ways: Call the ICE Tip Line, which is staffed 24-hours a day: (866) 347-2423 from the U.S. & Canada or (802) 872-6199 from anywhere in the world, or complete an online tip form at www.ice.gov/tips/.
Thursday, September 12, 2013
CALIFORNIA FORECLOSURE AUCTION BID RIGGER PLEADS GUILTY
FROM: U.S. JUSTICE DEPARTMENT
Investigations Have Yielded 36 Plea Agreements to Date
WASHINGTON — A Northern California real estate investor has agreed to plead guilty for his role in conspiracies to rig bids and commit mail fraud at public real estate foreclosure auctions in Northern California, the Department of Justice announced.
Felony charges were filed today in the U.S. District Court for the Northern District of California in San Francisco against Daniel Rosenbledt of Hillsborough, Calif. Rosenbledt is the 36th individual to plead guilty or agree to plead guilty as a result of the department’s ongoing antitrust investigations into bid rigging and fraud at public real estate foreclosure auctions in Northern California.
According to court documents, Rosenbledt conspired with others not to bid against one another, but instead to designate a winning bidder to obtain selected properties at public real estate foreclosure auctions in San Mateo and San Francisco counties, Calif. Rosenbledt was also charged with conspiring to use the mail to carry out schemes to fraudulently acquire title to selected properties sold at public auctions, to make and receive payoffs, and to divert to co-conspirators money that would have otherwise gone to mortgage holders and others.
Court papers stated Rosenbledt conspired with others to rig bids and commit mail fraud at public real estate foreclosure auctions in San Mateo County beginning as early as April 2008 and continuing until about January 2011. Rosenbledt was also charged with similar conduct in San Francisco County beginning as early as November 2009 and continuing until about January 2011.
“The Antitrust Division remains committed to vigorously pursuing conspirators who collude at foreclosure auctions at the expense of lenders and distressed homeowners,” said Bill Baer, Assistant Attorney General in charge of the Department of Justice’s Antitrust Division. “A competitive process benefits those homeowners who are looking for the best possible outcome during a difficult situation.”
The filing stated that the primary purpose of the conspiracies was to suppress and restrain competition and to conceal payoffs in order to obtain selected real estate offered at San Mateo and San Francisco County public foreclosure auctions at non-competitive prices. When real estate properties are sold at these auctions, the proceeds are used to pay off the mortgage and other debt attached to the property, with remaining proceeds, if any, paid to the homeowner. According to court documents, these conspirators paid and received money that otherwise would have gone to pay off the mortgage and other holders of debt secured by the properties, and, in some cases, the defaulting homeowner.
“For those who engage in illegal anticompetitive practices at foreclosure actions, we will hold you accountable for your actions and bring you to justice,” said David J. Johnson, FBI Special Agent in Charge of the San Francisco Field Office. “The FBI and the Antitrust Division are committed to rooting out those who undermine the real estate market and take advantage of legitimate home buyers and sellers.”
A violation of the Sherman Act carries a maximum penalty of 10 years in prison and a $1 million fine for individuals. The maximum fine for the Sherman Act charges may be increased to twice the gain derived from the crime or twice the loss suffered by the victims if either amount is greater than $1 million. A count of conspiracy to commit mail fraud carries a maximum sentence of 30 years in prison and a $1 million fine. The government can also seek to forfeit the proceeds earned from participating in the conspiracy to commit mail fraud.
The charges today are the latest filed by the department in its ongoing investigation into bid rigging and fraud at public real estate foreclosure auctions in San Francisco, San Mateo, Alameda and Contra Costa counties, Calif. These investigations are being conducted by the Antitrust Division’s San Francisco Office and the FBI’s San Francisco Office. Anyone with information concerning bid rigging or fraud related to public real estate foreclosure auctions should contact the Antitrust Division’s San Francisco Office at 415-436-6660, visit www.justice.gov/atr/contact/newcase.htm or call the FBI tip line at 415-553-7400.
Today's charges were brought in connection with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants.
Investigations Have Yielded 36 Plea Agreements to Date
WASHINGTON — A Northern California real estate investor has agreed to plead guilty for his role in conspiracies to rig bids and commit mail fraud at public real estate foreclosure auctions in Northern California, the Department of Justice announced.
Felony charges were filed today in the U.S. District Court for the Northern District of California in San Francisco against Daniel Rosenbledt of Hillsborough, Calif. Rosenbledt is the 36th individual to plead guilty or agree to plead guilty as a result of the department’s ongoing antitrust investigations into bid rigging and fraud at public real estate foreclosure auctions in Northern California.
According to court documents, Rosenbledt conspired with others not to bid against one another, but instead to designate a winning bidder to obtain selected properties at public real estate foreclosure auctions in San Mateo and San Francisco counties, Calif. Rosenbledt was also charged with conspiring to use the mail to carry out schemes to fraudulently acquire title to selected properties sold at public auctions, to make and receive payoffs, and to divert to co-conspirators money that would have otherwise gone to mortgage holders and others.
Court papers stated Rosenbledt conspired with others to rig bids and commit mail fraud at public real estate foreclosure auctions in San Mateo County beginning as early as April 2008 and continuing until about January 2011. Rosenbledt was also charged with similar conduct in San Francisco County beginning as early as November 2009 and continuing until about January 2011.
“The Antitrust Division remains committed to vigorously pursuing conspirators who collude at foreclosure auctions at the expense of lenders and distressed homeowners,” said Bill Baer, Assistant Attorney General in charge of the Department of Justice’s Antitrust Division. “A competitive process benefits those homeowners who are looking for the best possible outcome during a difficult situation.”
The filing stated that the primary purpose of the conspiracies was to suppress and restrain competition and to conceal payoffs in order to obtain selected real estate offered at San Mateo and San Francisco County public foreclosure auctions at non-competitive prices. When real estate properties are sold at these auctions, the proceeds are used to pay off the mortgage and other debt attached to the property, with remaining proceeds, if any, paid to the homeowner. According to court documents, these conspirators paid and received money that otherwise would have gone to pay off the mortgage and other holders of debt secured by the properties, and, in some cases, the defaulting homeowner.
“For those who engage in illegal anticompetitive practices at foreclosure actions, we will hold you accountable for your actions and bring you to justice,” said David J. Johnson, FBI Special Agent in Charge of the San Francisco Field Office. “The FBI and the Antitrust Division are committed to rooting out those who undermine the real estate market and take advantage of legitimate home buyers and sellers.”
A violation of the Sherman Act carries a maximum penalty of 10 years in prison and a $1 million fine for individuals. The maximum fine for the Sherman Act charges may be increased to twice the gain derived from the crime or twice the loss suffered by the victims if either amount is greater than $1 million. A count of conspiracy to commit mail fraud carries a maximum sentence of 30 years in prison and a $1 million fine. The government can also seek to forfeit the proceeds earned from participating in the conspiracy to commit mail fraud.
The charges today are the latest filed by the department in its ongoing investigation into bid rigging and fraud at public real estate foreclosure auctions in San Francisco, San Mateo, Alameda and Contra Costa counties, Calif. These investigations are being conducted by the Antitrust Division’s San Francisco Office and the FBI’s San Francisco Office. Anyone with information concerning bid rigging or fraud related to public real estate foreclosure auctions should contact the Antitrust Division’s San Francisco Office at 415-436-6660, visit www.justice.gov/atr/contact/newcase.htm or call the FBI tip line at 415-553-7400.
Today's charges were brought in connection with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants.
Wednesday, September 11, 2013
2 PATIENT RECRUITERS PLEAD GUILTY IN MULTI-MILLION DOLLAR HEALTH CARE FRAUD SCHEME
FROM: U.S. JUSTICE DEPARTMENT
Wednesday, September 4, 2013
Two Patient Recruiters of Miami Home Health Company Plead Guilty in $48 Million Health Care Fraud Scheme
Two patient recruiters of a Miami health care company pleaded guilty late yesterday for their participation in a $48 million home health Medicare fraud scheme.
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division; U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; Special Agent in Charge Michael B. Steinbach of the FBI’s Miami Field Office; and Special Agent in Charge Christopher Dennis of the HHS Office of Inspector General (HHS-OIG) Office of Investigations Miami Office made the announcement.
Elizabeth Monteagudo, 33, and Cristobal Gonzalez, 39, both of Miami, pleaded guilty on Sept. 3, 2013, before U.S. District Judge Joan A. Lenard to one count each of conspiracy to receive health care kickbacks. Monteagudo also pleaded guilty to receipt of kickbacks in connection with a federal health care program. Both charges carry a maximum penalty of five years in prison, and sentencing for both defendants is scheduled for Dec. 2, 2013.
According to court documents, Monteagudo and Gonzalez were patient recruiters who worked for Caring Nurse Home Health Care Corp., and Gonzalez also worked for Good Quality Home Health Care, Inc. Caring Nurse and Good Quality were Miami home health care agencies that purported to provide home health and therapy services to Medicare beneficiaries.
According to court documents, from approximately January 2009 through approximately June 2011, Monteagudo and Gonzalez would recruit patients for Caring Nurse and/or Good Quality and would solicit and receive kickbacks and bribes from the owners and operators of Caring Nurse and/or Good Quality in return for allowing the agency to bill the Medicare program on behalf of the recruited patients. These Medicare beneficiaries were billed for home health care and therapy services that were medically unnecessary and/or not provided.
Monteagudo also admitted to her involvement with $7 million in fraudulent billings for Starlite Home Health Agency Inc., which she owned and operated.
In a related case, on Feb. 27, 2013, Rogelio Rodriguez and Raymond Aday, the owners and operators of Caring Nurse and Good Quality, were sentenced to serve 108 and 51 months in prison, respectively. Their sentencings followed their December 2012 guilty pleas each to one count of conspiracy to commit health care fraud charged in an October 2012 indictment, which charged that from approximately January 2006 through June 2011, Caring Nurse and Good Quality submitted approximately $48 million in claims for home health services that were not medically necessary and/or not provided. Medicare actually paid approximately $33 million for these fraudulent claims.
The case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. This case is being prosecuted by Assistant Chief Joseph S. Beemsterboer of the Criminal Division’s Fraud Section.
Since their inception in March 2007, Medicare Fraud Strike Force operations in nine locations have charged more than 1,500 defendants who collectively have falsely billed the Medicare program for more than $5 billion. In addition, the HHS Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.
Wednesday, September 4, 2013
Two Patient Recruiters of Miami Home Health Company Plead Guilty in $48 Million Health Care Fraud Scheme
Two patient recruiters of a Miami health care company pleaded guilty late yesterday for their participation in a $48 million home health Medicare fraud scheme.
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division; U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; Special Agent in Charge Michael B. Steinbach of the FBI’s Miami Field Office; and Special Agent in Charge Christopher Dennis of the HHS Office of Inspector General (HHS-OIG) Office of Investigations Miami Office made the announcement.
Elizabeth Monteagudo, 33, and Cristobal Gonzalez, 39, both of Miami, pleaded guilty on Sept. 3, 2013, before U.S. District Judge Joan A. Lenard to one count each of conspiracy to receive health care kickbacks. Monteagudo also pleaded guilty to receipt of kickbacks in connection with a federal health care program. Both charges carry a maximum penalty of five years in prison, and sentencing for both defendants is scheduled for Dec. 2, 2013.
According to court documents, Monteagudo and Gonzalez were patient recruiters who worked for Caring Nurse Home Health Care Corp., and Gonzalez also worked for Good Quality Home Health Care, Inc. Caring Nurse and Good Quality were Miami home health care agencies that purported to provide home health and therapy services to Medicare beneficiaries.
According to court documents, from approximately January 2009 through approximately June 2011, Monteagudo and Gonzalez would recruit patients for Caring Nurse and/or Good Quality and would solicit and receive kickbacks and bribes from the owners and operators of Caring Nurse and/or Good Quality in return for allowing the agency to bill the Medicare program on behalf of the recruited patients. These Medicare beneficiaries were billed for home health care and therapy services that were medically unnecessary and/or not provided.
Monteagudo also admitted to her involvement with $7 million in fraudulent billings for Starlite Home Health Agency Inc., which she owned and operated.
In a related case, on Feb. 27, 2013, Rogelio Rodriguez and Raymond Aday, the owners and operators of Caring Nurse and Good Quality, were sentenced to serve 108 and 51 months in prison, respectively. Their sentencings followed their December 2012 guilty pleas each to one count of conspiracy to commit health care fraud charged in an October 2012 indictment, which charged that from approximately January 2006 through June 2011, Caring Nurse and Good Quality submitted approximately $48 million in claims for home health services that were not medically necessary and/or not provided. Medicare actually paid approximately $33 million for these fraudulent claims.
The case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. This case is being prosecuted by Assistant Chief Joseph S. Beemsterboer of the Criminal Division’s Fraud Section.
Since their inception in March 2007, Medicare Fraud Strike Force operations in nine locations have charged more than 1,500 defendants who collectively have falsely billed the Medicare program for more than $5 billion. In addition, the HHS Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.
Tuesday, September 10, 2013
2 ROMANIAN NATIONALS RECEIVE PRISON TERMS IN PAYMENT CARD DATA THEFT SCHEME
FROM: U.S. JUSTICE DEPARTMENT
Wednesday, September 4, 2013
Two Romanian Nationals Sentenced to Prison for Scheme to Steal Payment Card Data
Adrian-Tiberiu Oprea, 29, of Constanta, Romania, and Iulian Dolan, 28, of Craiova, Romania, were sentenced today to serve 15 years and seven years in prison, respectively, for participating in an international, multimillion-dollar scheme to remotely hack into and steal payment card data from hundreds of U.S. merchants’ computers, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division; U.S. Attorney John P. Kacavas of the District of New Hampshire; and Holly Fraumeni, Resident Agent in Charge of the U.S. Secret Service, Manchester, N.H., Resident Office.
On May 7, 2013, Oprea, who was extradited to the United States from Romania, pleaded guilty to one count of conspiracy to commit computer fraud, one count of conspiracy to commit wire fraud and two counts of conspiracy to commit access device fraud. On Sept. 17, 2012, Dolan pleaded guilty to one count of conspiracy to commit computer fraud and two counts of conspiracy to commit access device fraud.
Court documents state that, from approximately 2009 to 2011, Oprea conspired with Dolan and Cezar Butu, 27, of Ploiesti, Romania, to hack into hundreds of computers located in the United States to steal credit, debit and payment account numbers and associated data (collectively “payment card data”) that belonged to U.S. cardholders.
According to court documents, Oprea and Dolan remotely hacked into hundreds of U.S. merchants’ point-of-sale (POS) or “check out” computer systems, where customers’ payment card data was electronically stored. Specifically, Oprea, who was the leader of the scheme, and Dolan, who was his trusted aide, first used the Internet to identify U.S.-based vulnerable POS systems. After identifying a vulnerable system, Oprea and Dolan would gain access and install software programs called “keystroke loggers” (or “sniffers”) onto the POS systems. These programs would record, and then store, all of the data that was keyed into or swiped through the merchants’ POS systems, including customers’ payment card data.
Oprea and Dolan retrieved the card data and then electronically transferred it to various electronic storage locations (“dump sites”) that Oprea had set up. Oprea later attempted to use the stolen payment card data to make unauthorized charges on, or transfers of funds from, the accounts. He also attempted to transfer the stolen payment card data to other co-conspirators for them to use in a similar manner. During the course of the conspiracies, the co-conspirators hacked into several hundred U.S. merchants’ POS systems, including 250 Subway restaurant franchises, and stole payment card data belonging to more than 100,000 U.S. cardholders. Their criminal conduct caused losses of at least $17.5 million in unauthorized charges and remediation expenses.
The case was investigated by the U.S. Secret Service, with assistance from the New Hampshire State Police and Romanian authorities.
The case is being prosecuted by Trial Attorney Mona Sedky of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Arnold H. Huftalen of the District of New Hampshire. Significant assistance was provided by the Criminal Division’s Office of International Affairs.
Wednesday, September 4, 2013
Two Romanian Nationals Sentenced to Prison for Scheme to Steal Payment Card Data
Adrian-Tiberiu Oprea, 29, of Constanta, Romania, and Iulian Dolan, 28, of Craiova, Romania, were sentenced today to serve 15 years and seven years in prison, respectively, for participating in an international, multimillion-dollar scheme to remotely hack into and steal payment card data from hundreds of U.S. merchants’ computers, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division; U.S. Attorney John P. Kacavas of the District of New Hampshire; and Holly Fraumeni, Resident Agent in Charge of the U.S. Secret Service, Manchester, N.H., Resident Office.
On May 7, 2013, Oprea, who was extradited to the United States from Romania, pleaded guilty to one count of conspiracy to commit computer fraud, one count of conspiracy to commit wire fraud and two counts of conspiracy to commit access device fraud. On Sept. 17, 2012, Dolan pleaded guilty to one count of conspiracy to commit computer fraud and two counts of conspiracy to commit access device fraud.
Court documents state that, from approximately 2009 to 2011, Oprea conspired with Dolan and Cezar Butu, 27, of Ploiesti, Romania, to hack into hundreds of computers located in the United States to steal credit, debit and payment account numbers and associated data (collectively “payment card data”) that belonged to U.S. cardholders.
According to court documents, Oprea and Dolan remotely hacked into hundreds of U.S. merchants’ point-of-sale (POS) or “check out” computer systems, where customers’ payment card data was electronically stored. Specifically, Oprea, who was the leader of the scheme, and Dolan, who was his trusted aide, first used the Internet to identify U.S.-based vulnerable POS systems. After identifying a vulnerable system, Oprea and Dolan would gain access and install software programs called “keystroke loggers” (or “sniffers”) onto the POS systems. These programs would record, and then store, all of the data that was keyed into or swiped through the merchants’ POS systems, including customers’ payment card data.
Oprea and Dolan retrieved the card data and then electronically transferred it to various electronic storage locations (“dump sites”) that Oprea had set up. Oprea later attempted to use the stolen payment card data to make unauthorized charges on, or transfers of funds from, the accounts. He also attempted to transfer the stolen payment card data to other co-conspirators for them to use in a similar manner. During the course of the conspiracies, the co-conspirators hacked into several hundred U.S. merchants’ POS systems, including 250 Subway restaurant franchises, and stole payment card data belonging to more than 100,000 U.S. cardholders. Their criminal conduct caused losses of at least $17.5 million in unauthorized charges and remediation expenses.
The case was investigated by the U.S. Secret Service, with assistance from the New Hampshire State Police and Romanian authorities.
The case is being prosecuted by Trial Attorney Mona Sedky of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Arnold H. Huftalen of the District of New Hampshire. Significant assistance was provided by the Criminal Division’s Office of International Affairs.
Monday, September 9, 2013
TIPS LEAD TO CAPTURE OF U.S. MARSHALS 'FUGITIVE OF THE WEEK'
FROM: U.S. MARSHALS SERVICES
U.S. Marshals 'Fugitive of the Week' Arrested in Dover Based on Tips
Concord, NH - 'Fugitive of the Week' Jose Garcia, 33, was arrested without incident late this afternoon by the Dover Police Department and NH Probation and Parole Officers. Garcia was arrested at a residence on Baker Street after callers reported seeing Garcia at this location.
The NH Department of Corrections, Probation and Parole division had recently requested that Garcia be considered to be featured as the “Fugitive of the Week.” Garcia was featured just this past week on WTPL-FM, WMUR-TV, The Union Leader and the Nashua Telegraph. This publicity assisted in motivating the public to call in tips that led to the arrest of Garcia. Garcia was being sought on an outstanding arrest warrant for probation violations, as well as a warrant for a domestic violence assault. Garcia was on probation for a prior conviction and sentence for stalking.
As part of this investigation, Garcia was aired in the weekly feature known as the 'Fugitive of the Week' on August 29, 2013. The 'Fugitive of the Week' is broadcast on WTPL-FM, WMUR-TV, The Union Leader, The Nashua Telegraph and prominently featured on the internet.
Information that led to the arrest of Garcia was provided by tipsters that directly contacted probation officers. These tips led investigators to the Dover address, where Garcia was taken into custody without incident. Garcia was arrested on the outstanding probation warrant and was brought to the Somersworth Police Department to be processed on the outstanding arrest warrant for Domestic Assault. Garcia will be held at the Strafford County Jail until his initial court appearance, later this week.
Several member agencies from the U.S. Marshals Fugitive Task Force assisted in the arrest of Garcia, including; NH Probation & Parole, Dover & Somersworth Police Departments, the Strafford County Sheriff’s Office, and deputy U.S. Marshals.
Since the inception of the New Hampshire Joint Fugitive Task Force in 2002, these partnerships have resulted in over 5,370 arrests. These arrests have ranged in seriousness from murder, assault, unregistered sex offenders, probation and parole violations and numerous other serious offenses. Nationally the United States Marshals Service fugitive programs are carried out with local law enforcement in 94 district offices, 85 local fugitive task forces, 7 regional task forces, as well as a growing network of offices in foreign countries.
U.S. Marshals 'Fugitive of the Week' Arrested in Dover Based on Tips
Concord, NH - 'Fugitive of the Week' Jose Garcia, 33, was arrested without incident late this afternoon by the Dover Police Department and NH Probation and Parole Officers. Garcia was arrested at a residence on Baker Street after callers reported seeing Garcia at this location.
The NH Department of Corrections, Probation and Parole division had recently requested that Garcia be considered to be featured as the “Fugitive of the Week.” Garcia was featured just this past week on WTPL-FM, WMUR-TV, The Union Leader and the Nashua Telegraph. This publicity assisted in motivating the public to call in tips that led to the arrest of Garcia. Garcia was being sought on an outstanding arrest warrant for probation violations, as well as a warrant for a domestic violence assault. Garcia was on probation for a prior conviction and sentence for stalking.
As part of this investigation, Garcia was aired in the weekly feature known as the 'Fugitive of the Week' on August 29, 2013. The 'Fugitive of the Week' is broadcast on WTPL-FM, WMUR-TV, The Union Leader, The Nashua Telegraph and prominently featured on the internet.
Information that led to the arrest of Garcia was provided by tipsters that directly contacted probation officers. These tips led investigators to the Dover address, where Garcia was taken into custody without incident. Garcia was arrested on the outstanding probation warrant and was brought to the Somersworth Police Department to be processed on the outstanding arrest warrant for Domestic Assault. Garcia will be held at the Strafford County Jail until his initial court appearance, later this week.
Several member agencies from the U.S. Marshals Fugitive Task Force assisted in the arrest of Garcia, including; NH Probation & Parole, Dover & Somersworth Police Departments, the Strafford County Sheriff’s Office, and deputy U.S. Marshals.
Since the inception of the New Hampshire Joint Fugitive Task Force in 2002, these partnerships have resulted in over 5,370 arrests. These arrests have ranged in seriousness from murder, assault, unregistered sex offenders, probation and parole violations and numerous other serious offenses. Nationally the United States Marshals Service fugitive programs are carried out with local law enforcement in 94 district offices, 85 local fugitive task forces, 7 regional task forces, as well as a growing network of offices in foreign countries.
Sunday, September 8, 2013
TRUCK BROKER SENTENCED FOR DUMPING ASBESTOS INTO THE MOHAWK RIVER
FROM: U.S. JUSTICE DEPARTMENT
Thursday, August 29, 2013
Truck Broker Sentenced for Dumping Thousands of Tons of Asbestos Contaminated Debris in Violation of the Clean Water Act
Jonathan Deck, 59, of Norwood, N.J., was sentenced today in federal court in Utica, N.Y., to 15 months in prison for conspiring to commit wire fraud in connection with the illegal dumping of thousands of tons of asbestos-contaminated construction debris on a 28-acre piece of property on the Mohawk River in upstate New York, the Justice Department announced.
Deck was the last individual sentenced in a series of prosecutions that involved at least two companies and five individuals including Eagle Recycling, Mazza & Sons Inc., Julius DeSimone, Donald Torriero, Dominick Mazza, and Cross Nicastro. The investigation of this conspiracy spanned more than five years and resulted in more than 10 years of incarceration and more than $1 million in criminal fines, restitution, and cleanup costs to remediate a site now contaminated with more than 400 truckloads of asbestos-contaminated wastes.
With respect to Mr. Deck, U.S. District Judge David N. Hurd sentenced him to serve 15 months in prison, followed by three years of supervised release. He was further ordered to pay $492,000 in restitution for, among other things, cleanup expenses at the site. Given the ongoing nature of the cleanup, Judge Hurd further authorized the United States to recoup additional, future cleanup costs from the conspirators as well.
Deck pleaded guilty to conspiring to violate the wire fraud statute. According to the evidence, Deck and others conspired to fill in the entire property over the course of five years with pulverized construction and demolition debris that was processed at New Jersey solid waste management facilities and then transported to open property in Frankfort, N.Y. The plot was uncovered by law enforcement just months after the operation began, but not before the conspirators had already dumped at least 400 truckloads of debris at the site. Much of the material that was dumped was placed in and around waters of the United States and some of the material was found to be contaminated with asbestos. The conspirators then concealed the illegal dumping and recruited others to join in the illegal dumping by fabricating a New York State Department of Environmental Conservation (DEC) permit and forged the name of a DEC official on the fraudulent permit.
This case was investigated by the New York State Environmental Conservation Police, Bureau of Environmental Crimes, EPA’s Criminal Investigation Division, Internal Revenue Service, New Jersey State Police Office of Business Integrity Unit, New Jersey Department of Environmental Protection, and Ohio Department of Environmental Protection. The case was prosecuted by Assistant U.S. Attorney Craig A. Benedict of the Northern District of New York, and Trial Attorneys Todd W. Gleason and Gary Donner of the Environmental Crimes Section of the Justice Department’s Environment and Natural Resources Division.
Thursday, August 29, 2013
Truck Broker Sentenced for Dumping Thousands of Tons of Asbestos Contaminated Debris in Violation of the Clean Water Act
Jonathan Deck, 59, of Norwood, N.J., was sentenced today in federal court in Utica, N.Y., to 15 months in prison for conspiring to commit wire fraud in connection with the illegal dumping of thousands of tons of asbestos-contaminated construction debris on a 28-acre piece of property on the Mohawk River in upstate New York, the Justice Department announced.
Deck was the last individual sentenced in a series of prosecutions that involved at least two companies and five individuals including Eagle Recycling, Mazza & Sons Inc., Julius DeSimone, Donald Torriero, Dominick Mazza, and Cross Nicastro. The investigation of this conspiracy spanned more than five years and resulted in more than 10 years of incarceration and more than $1 million in criminal fines, restitution, and cleanup costs to remediate a site now contaminated with more than 400 truckloads of asbestos-contaminated wastes.
With respect to Mr. Deck, U.S. District Judge David N. Hurd sentenced him to serve 15 months in prison, followed by three years of supervised release. He was further ordered to pay $492,000 in restitution for, among other things, cleanup expenses at the site. Given the ongoing nature of the cleanup, Judge Hurd further authorized the United States to recoup additional, future cleanup costs from the conspirators as well.
Deck pleaded guilty to conspiring to violate the wire fraud statute. According to the evidence, Deck and others conspired to fill in the entire property over the course of five years with pulverized construction and demolition debris that was processed at New Jersey solid waste management facilities and then transported to open property in Frankfort, N.Y. The plot was uncovered by law enforcement just months after the operation began, but not before the conspirators had already dumped at least 400 truckloads of debris at the site. Much of the material that was dumped was placed in and around waters of the United States and some of the material was found to be contaminated with asbestos. The conspirators then concealed the illegal dumping and recruited others to join in the illegal dumping by fabricating a New York State Department of Environmental Conservation (DEC) permit and forged the name of a DEC official on the fraudulent permit.
This case was investigated by the New York State Environmental Conservation Police, Bureau of Environmental Crimes, EPA’s Criminal Investigation Division, Internal Revenue Service, New Jersey State Police Office of Business Integrity Unit, New Jersey Department of Environmental Protection, and Ohio Department of Environmental Protection. The case was prosecuted by Assistant U.S. Attorney Craig A. Benedict of the Northern District of New York, and Trial Attorneys Todd W. Gleason and Gary Donner of the Environmental Crimes Section of the Justice Department’s Environment and Natural Resources Division.
Saturday, September 7, 2013
FORMER PROBATION OFFICER SENTENCED FOR COERCING PROBATIONER
FROM: U.S. JUSTICE DEPARTMENT
Thursday, August 29, 2013
Former North Carolina Probation Officer Sentenced for Coercing Probationer into Sexual Acts
Jocelyn Samuels, Acting Assistant Attorney General for the Civil Rights Division and Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina, announced today that former North Carolina Department of Correction’s Division of Community Corrections Probation Officer Willie James Steele Jr., 43, has been sentenced for violating the constitutional rights of a female probationer that he was supervising by coercing her into sexual acts on two separate occasions.
According to an indictment and evidence presented in court, Steele supervised the female probationer in 2008 after her probation was transferred to North Carolina from another state and he had the authority to recommend to a court or other agency that the victim be incarcerated or otherwise sanctioned if she violated the conditions of her probation. On Dec. 12, 2012, after a two-day trial, a jury found Steele guilty of two civil rights violations for depriving the victim of her constitutional right to bodily integrity by having non-consensual sexual intercourse with her during two separate probation meetings.
Chief Judge Robert J. Conrad, who presided over the trial, sentenced Steele to serve the statutory maximum incarceration of 24 months in prison, to be followed by one year of supervised release, for his convictions at trial.
“Probation officers are given a great deal of power in order to carry out their critical responsibilities, but this officer abused that power and violated the civil rights of a woman under his supervision,” said Acting Assistant Attorney General Samuels. “We will vigorously prosecute any probation officer who uses his position of trust to prey upon those he supervises.”
“Any time a law enforcement officer breaks the law it undermines the public’s trust in the legal system and we will do everything we can to ensure that trust is not compromised,” said U.S. Attorney Tompkins. “My office will prosecute those who abuse their position of power and use it to violate the civil rights of others.”
This case was investigated by the FBI and the North Carolina State Bureau of Investigation, and is being prosecuted by the Assistant U.S. Attorney Kimlani Ford from the Western District of North Carolina and Trial Attorney Shan Patel from the Civil Rights Division.
Thursday, August 29, 2013
Former North Carolina Probation Officer Sentenced for Coercing Probationer into Sexual Acts
Jocelyn Samuels, Acting Assistant Attorney General for the Civil Rights Division and Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina, announced today that former North Carolina Department of Correction’s Division of Community Corrections Probation Officer Willie James Steele Jr., 43, has been sentenced for violating the constitutional rights of a female probationer that he was supervising by coercing her into sexual acts on two separate occasions.
According to an indictment and evidence presented in court, Steele supervised the female probationer in 2008 after her probation was transferred to North Carolina from another state and he had the authority to recommend to a court or other agency that the victim be incarcerated or otherwise sanctioned if she violated the conditions of her probation. On Dec. 12, 2012, after a two-day trial, a jury found Steele guilty of two civil rights violations for depriving the victim of her constitutional right to bodily integrity by having non-consensual sexual intercourse with her during two separate probation meetings.
Chief Judge Robert J. Conrad, who presided over the trial, sentenced Steele to serve the statutory maximum incarceration of 24 months in prison, to be followed by one year of supervised release, for his convictions at trial.
“Probation officers are given a great deal of power in order to carry out their critical responsibilities, but this officer abused that power and violated the civil rights of a woman under his supervision,” said Acting Assistant Attorney General Samuels. “We will vigorously prosecute any probation officer who uses his position of trust to prey upon those he supervises.”
“Any time a law enforcement officer breaks the law it undermines the public’s trust in the legal system and we will do everything we can to ensure that trust is not compromised,” said U.S. Attorney Tompkins. “My office will prosecute those who abuse their position of power and use it to violate the civil rights of others.”
This case was investigated by the FBI and the North Carolina State Bureau of Investigation, and is being prosecuted by the Assistant U.S. Attorney Kimlani Ford from the Western District of North Carolina and Trial Attorney Shan Patel from the Civil Rights Division.
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