Criminal Justice News

Tuesday, May 31, 2011

Tucson Sector Border Patrol Agents Arrest 10 Drug Smugglers

More than 1,690 pounds of marijuana seized

Tucson, Ariz. – Tucson Sector Border Patrol Agents apprehended 10 smugglers and seized more than 1,690 pounds of marijuana last night near Lukeville. The marijuana had an estimated value of $845,000.
Ajo Station agents, using an infrared camera, detected a group of suspected illegal aliens walking in the desert carrying large backpacks. The Ajo Station’s All Terrain Vehicle Unit, Horse Patrol Unit and a CBP helicopter responded to the location.

Once at the scene, the helicopter pilot directed agents on the ground toward the group hiding in the brush. Agents apprehended 10 drug smugglers and discovered 38 bundles of marijuana in the immediate area.

The 10 drug smugglers were transported to the Ajo Station and are being held for prosecution. The marijuana was turned over to the Drug Enforcement Administration.

Since launching the Southwest Border Initiative in March 2009, the Department of Homeland Security has made significant investments towards establishing a secure and safe border environment and improving the quality of life throughout the communities in the state of Arizona.

The Border Patrol welcomes assistance from the community. Report suspicious activity by calling toll free (1-877) 872-7435. All calls will be answered and callers will remain anonymous.

U.S. Customs and Border Protection is the unified border agency within the Department of Homeland Security charged with the management, control and protection of our nation's borders at and between the official ports of entry. CBP is charged with keeping terrorists and terrorist weapons out of the country while enforcing hundreds of U.S. laws.

Armed Robbery of Sovereign Bank Branch in Philadelphia

The FBI and the Philadelphia Police Department are seeking the public’s assistance to identify and locate the subjects responsible for the armed robbery of the Sovereign Bank branch located at 8623 Germantown Avenue earlier today.

At approximately 12:57 p.m., two subjects entered the branch, and while one brandished a dark-colored shotgun with a pistol grip and threatened the employees, the other vaulted the teller counter. After obtaining an undisclosed amount of cash, the subjects fled the bank on foot southbound through the bank’s parking lot and were last seen getting into a silver sedan with tinted windows, possibly a Pontiac Grand Am, headed south on Ardleigh Street from East Evergreen Avenue. There were no physical injuries.

The subjects are both described as being 25 to 30 years of age, 5’7” to 5’9” tall, with medium builds. Both subjects were wearing black cloths or masks over the lower portions of their faces. The subject who brandished the shotgun was wearing a red Philadelphia Phillies baseball cap, a dark long-sleeve shirt, tan pants, and white sneakers and was carrying a large black duffle bag. The subject who vaulted the counter was wearing a black Philadelphia Phillies baseball cap, a dark long-sleeved shirt, blue jeans, and black sneakers.

These subjects are considered armed and dangerous. Anyone with information is asked to call the FBI at 215-418-4000 or the Philadelphia Police Department. There may be a reward for information leading to the capture of these subjects, and tipsters can remain anonymous.

Several pictures are below. One picture is of the subject with the red hat in the lobby of the branch, before he donned the black mask.

Agents In Tucson Recover Drugs, Weapons, Vehicle In A Five Hour Period

Marijuana weighs more than 1.5 tons with estimated value of $2.5 million

Tucson, Ariz. – Tucson Sector Border Patrol Agents seized more than 3,000 pounds of marijuana, a handgun, an assault rifle and recovered a stolen vehicle in a five-hour period. The marijuana had an estimated value of more than $2.5 million.

Wednesday afternoon, Willcox Station Border Patrol agents attempted to perform a traffic stop on Interstate 10, near Mile Marker 299. The driver did not yield and eventually abandoned the vehicle to evade arrest. Subsequently, agents found 40 bundles of marijuana, a handgun, and three magazines containing .45-caliber ammunition. The narcotics weighed 929 pounds with an estimated value of $464,500. The vehicle and narcotics were seized and will be turned over to the Drug Enforcement Administration (DEA). The handgun will be turned over to the Bureau of Alcohol, Tobacco and Firearms

Earlier that evening, security officers at the Barry M. Goldwater Range requested Border Patrol assistance in the pursuit of an all terrain vehicle suspected of drug smuggling. An Ajo Station Border Patrol canine team responded and seized ten bundles of marijuana that were strapped to the ATV. In addition, a discarded AK-47 assault rifle with three full magazines was recovered from a nearby area. The narcotics weighed 516 pounds with an estimated value of $258,000. The narcotics were seized and will be turned over to the DEA. The ATV, firearm, and ammunition were turned over to the Maricopa County Sherriff’s Office.

On Wednesday evening, Ajo Station Border Patrol Agents seized 77 bundles of marijuana and recovered a stolen pickup truck after following its vehicle tracks to an area approximately five miles west of Federal Route 1. The truck was concealed with a tarp and contained approximately 1,757 pounds of marijuana. A records check indicated the truck was reported stolen out of Surprise, Ariz. The marijuana was transported to the Ajo Border Patrol Station and will be turned over to the DEA. The truck was turned over to the Tohono O’odham Police Department.

Since launching the Southwest Border Initiative in March 2009, the Department of Homeland Security has made significant investments towards establishing a secure and safe border environment and improving the quality of life throughout the communities in the state of Arizona.

The Border Patrol welcomes assistance from the community. Report suspicious activity by calling toll free (877) 872-7435. All calls will be answered and will remain anonymous.

U.S. Customs and Border Protection is the unified border agency within the Department of Homeland Security charged with the management, control and protection of our nation's borders at and between the official ports of entry. CBP is charged with keeping terrorists and terrorist weapons out of the country while enforcing hundreds of U.S. laws.

Two Luzerne County Bank Tellers Plead Guilty to Conspiring to Commit Theft

The United States Attorney’s Office for the Middle District of Pennsylvania announced that two former Luzerne County bank tellers pleaded guilty yesterday before Senior United States District Judge A. Richard Caputo to the charge of conspiring to commit theft from the Kingston, Luzerne County, Branch Office of First Keystone National Bank.

According to United States Attorney Peter J. Smith, Mary Ann Wright, age 42, of Kingston, and Jennifer Sgroi, age 30, of Wyoming, who were employed as bank tellers, entered guilty pleas to an information which charged them with embezzling more than $7,000 in currency from their teller “cash drawers” at the Kingston Branch Office of First Keystone National Bank between 2009 and 2010. The information further charged that, in anticipation of bank audits, Wright and Sgroi would remove money from each other’s “cash drawers” in order to hide the cash discrepancies.

Each defendant faces a maximum penalty of five years in prison, followed by a three-year term of supervised release and a $250,000 fine.

U.S. Attorney Smith noted that the investigation was conducted by the Federal Bureau of Investigation and that the case is being prosecuted by Assistant United States Attorney Robert J. O’Hara.

Loan Processors Sentenced in Mortgage Fraud Scheme

PHILADELPHIA—Kirk H. Kirby, 40, of Capital Heights, Maryland, and Sholonda Y. Johnson, 39, of Philadelphia, were sentenced today to 60 months and 30 months in prison, respectively, in connection with a real estate investment scheme, announced United States Attorney Zane David Memeger. Kirby and Johnson pleaded guilty to three counts each of wire fraud in connection with a real estate investment scheme that caused millions of dollars in losses to lenders. Kirby owned and operated Invictus Financial Group ("IFG"), located in Havertown, PA. Johnson was a loan officer at various mortgage brokerage companies.

Kirby pretended to be a licensed mortgage broker. His complex and massive mortgage fraud scheme was similar to a Ponzi scheme, having a national impact on victim lenders and duping investors. Between June 2006 and December 2007, Kirby identified many properties across the country, including in Pennsylvania, New Jersey, Georgia, Arizona, and Nevada, for unsuspecting investors to purchase. Kirby and Johnson obtained loans for these properties using bogus documents that were submitted to lenders. Kirby recruited separate investors to purchase several properties each and purposely used separate lenders for the deals. Kirby would then act as a dual agent, negotiating one price with the seller and a higher price for the buyer, taking the difference as his profit. Kirby also obtained financing for the investor through, among others, defendant Johnson, who brokered mortgage loans and who provided false documents to mortgage lenders. Kirby and Johnson routinely concealed from the lenders the fact that they had obtained multiple mortgages in one investor's name. Kirby intentionally used people that he knew, including local church members, fraternity brothers, and friends and colleagues with modest incomes, to invest in the real estate. In a Ponzi-like fashion, Kirby falsely promised investors no risk of loss and guaranteed returns.

In an arrangement that appeared to present little risk for the investor, the indictment alleges that defendant Kirby promised investors that he would manage all aspects of the investment properties, including finding tenants, collecting rents, repairing and maintaining properties, and making mortgage payments. Kirby further promised that he would cover mortgage payments if the property was not rented or if rent payments did not cover the mortgage payments, he assured investors that he had obtained an insurance policy to cover their losses but he did not do so, and he promised to cover any losses on sales of investment properties. When defendant Kirby was unable to obtain tenants for the investment properties and could not make the required mortgage payments, the investors defaulted on the dozens of mortgages the defendants had obtained as part of the scheme. Contrary to Kirby's false claims, there was no insurance policy to cover the payments to the lenders. Kirby and Johnson were responsible for causing more than $6 million in losses to the lenders.

In addition to the prison terms, U.S. District Court Judge Harvey Bartle, III, ordered restitution in the amount of $3,905,853.27 to be paid by Kirby and $2,423,401.34 to be paid by Johnson.

This case was investigated by the Federal Bureau of Investigation and was prosecuted by Assistant United States Attorney Jessica Natali.

Doral Woman Convicted of Health Care Fraud and False Statements Regarding Health Care Matters

Wifredo A. Ferrer, United States Attorney for the Southern District of Florida; John V. Gillies, Special Agent in Charge, Federal Bureau of Investigation, Miami Field Office; and Christopher B. Dennis, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG), Office of Investigations, Miami Regional Office, announced that a federal jury in Miami found Isachi Gil, 36, of Doral, Florida, guilty of health care fraud and making false statements related to health care matters. More specifically, after a three week trial, the jury convicted Gil of five counts of health care fraud, in violation of Title 18, United States Code, Section 1347, and six counts of false statements related to health care matters, in violation of Title 18, United States Code, Section 1035.

Sentencing is scheduled for July 27, 2011 before U.S. District Judge Marcia Cooke. Gil faces a statutory maximum of 10 years’ imprisonment as to each of the fraud charges, and five year imprisonment as to each of the false statement charges.

According to the evidence presented at trial, Gil was a registered nurse employed by 13 separate Miami-Dade based home health care agencies. As part of her job as a home health nurse, Gil provided skilled nursing services to Medicare beneficiaries that were homebound, diabetic, insulin-dependent, and so ill that they were unable to inject themselves with insulin. Under Medicare regulations, Gil was required to keep records of each time she provided a skilled nursing service to a Medicare beneficiary. Between March 2007 and July 2009, Gil completed hundreds of documents in which she claimed that she had injected Medicare beneficiaries with insulin two times a day, seven days per week.

At trial, however, the evidence showed that at least two of the Medicare beneficiaries that the defendant claimed to be injecting with insulin were not diabetic. In addition, the evidence showed more than 160 instances in which the defendant was out of the country, including being in Panama, Mexico, or the Dominican Republic, during the dates that she claimed to be providing skilled nursing services to Medicare beneficiaries. As well, the defendant signed dozens of documents claiming that she was providing skilled nursing services when, in fact, she was attending classes at Florida International University. Also, the defendant claimed to be providing skilled nursing visits to two and three patients simultaneously, double and triple billing Medicare. The defendant’s false statements resulted in the submission of hundreds of thousands of dollars in false claims to Medicare for services that were either not medically necessary or provided to Medicare beneficiaries.

Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case was prosecuted by Assistant U.S. Attorneys Daniel Bernstein and Robert J. Luck.

A copy of this press release may be found on the website of the United States Attorney’s Office for the Southern District of Florida at www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the United States District Court for the Southern District of Florida at www.flsd.uscourts.gov or http://pacer.flsd.uscourts.gov.

“Brazen Bandit” Bank Robber Sentenced to 52 Years in Prison

Wifredo A. Ferrer, United States Attorney for the Southern District of Florida; John V. Gillies, Special Agent in Charge, Federal Bureau of Investigation, Miami Field Office; Al Lamberti, Sheriff, Broward Sheriff’s Office; and Daniel C. Alexander, Chief, Boca Raton Police Department, announced today that Michael Anthony Price, 44, of Coconut Creek, Florida, was sentenced earlier today. U.S. District Court Judge William J. Zloch sentenced Price to 52 years in prison, to be followed by five years’ supervised release.

Price, dubbed the “Brazen Bandit,” was convicted of two counts of bank robbery, conspiracy to commit bank robbery, two counts of use of a firearm during a crime of violence, and possessing a firearm after having been convicted of a felony offense. According to evidence presented at trial, the first bank robbery took place on Friday, August 13, 2010, at the PNC Bank. Price, wearing a black baseball cap and sunglasses, entered the bank and approached a customer service consultant. Price stated he wished to open an account and then pointed a black revolver at the consultant. He then approached a teller station, placed a backpack on the counter, and pointed his firearm at a victim teller. He demanded money and told the teller that she had “15 seconds” to comply. While the gun was pointed at her, the teller placed the money in the defendant’s backpack. Price then left the bank.

The second bank robbery occurred on Wednesday, August 18, 2010, at the Amtrust Bank in Deerfield Beach. According to the evidence at trial, Price wore a black baseball cap, sunglasses, and a bandana covering his mouth when he entered the bank. He carried a black revolver in his hand. Price vaulted the teller counter and demanded money from multiple tellers at various stations, while brandishing the firearm. As Price was jumping back over the counter to flee with his loot, he shot a 67-year-old customer. After shooting the customer in the neck, Price left the bank, discharging two rounds from his revolver as he fled. The shooting victim is paralyzed from the neck down.

Co-defendant Greg Bryan Senser, 29, of Boynton Beach, who was the getaway driver for each of the robberies, pled guilty on February 25, 2011 before Judge Zloch and is scheduled to be sentenced on June 3, 2011.

U.S. Attorney Wifredo Ferrer commended the FBI’s Violent Crime Task Force, Broward Sheriff’s Office, and the Boca Raton Police Department for their excellent work on this matter. The FBI’s Violent Crime Task Force includes members from the FBI, BSO, U.S. Secret Service, and the police departments from the City of Miami, Miami Beach, and Miami-Dade. This case was prosecuted by Assistant U.S. Attorneys Mark Dispoto, Cynthia Stone and Jason Linder.

A copy of this press release may be found on the website of the United States Attorney’s Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.

FCI Gilmer Resident Sentenced for Resisting and Impeding a Correctional Officer

CLARKSBURG, WV—A 36-year-old federal inmate was sentenced on May 19, 2011, in United States District Court in Clarksburg by Judge Irene M. Keeley.

United States Attorney William J. Ihlenfeld, II, announced that CLYDE SCOTT, an inmate at FCI Gilmer, was sentenced to 12 months’ imprisonment to run consecutive to his current sentence of 220 months. SCOTT entered a plea of guilty to one count of a superseding indictment charging him with resisting and impeding a correctional officer on February 9, 2010.

The case was prosecuted by Assistant United States Attorney Brandon S. Flower. The case was investigated by the Federal Bureau of Investigation and Special Investigative Services at FCI Gilmer.

Federal and State Officials Hold Training Conference on Criminal Enforcement of Oil and Natural Gas Extraction in the Marcellus Shale

STATE COLLEGE, PA—Federal and state law enforcement officials concluded a conference today aimed at educating the Pennsylvania and regional law enforcement community on the process of natural gas extraction from the Marcellus Shale formation and the potential impacts on the communities where it is prevalent.

The two-day Marcellus Shale Law Enforcement Training Conference—attended by more than 200 federal, state, and local law enforcement officers, prosecutors, and environmental officials from Pennsylvania, New York, West Virginia, and Ohio—was hosted by the U.S. Department of Justice Environmental and Natural Resources Division and the United States Attorneys for the Eastern, Western, and Middle Districts of Pennsylvania.

The conference focused on potential environmental impacts and law enforcement issues arising from the rapid expansion of natural gas extraction in the Marcellus Shale region. It was also intended to strengthen communication and coordination among federal, state, and local law enforcement.

"As a result of innovations like hydraulic fracturing and directional drilling, oil and gas extraction is occurring with increasing frequency in certain concentrated regions across the nation, including the Marcellus Shale region," said Ignacia S. Moreno, Assistant Attorney General for the Environment and Natural Resources Division at the Department of Justice. "Exploration of sources of domestic energy is vital to the national interest. In doing so, we must ensure that all laws intended to protect human health, sources of drinking water, wildlife, and the environment are well understood and enforced to mitigate any potential adverse effects."

Peter J. Smith, United States Attorney for the Middle District of Pennsylvania noted that he and the United States Attorneys from the Eastern and Western Districts of Pennsylvania stated, "Federal, state, and local law enforcement must work together to protect, most diligently the public health, the environment that we are all part of, and the communities that we live in from the harmful byproducts of rapid industrial development and social change. The conference presents us with a great opportunity to launch this joint effort."

According the U.S. Department of Energy, it is projected that shale gas from formations like the Marcellus Shale will comprise over 20 percent of the total U.S. gas supply by 2020. The Marcellus, a naturally occurring shale formation deep below the Earth's surface, is located mostly in Pennsylvania, New York, West Virginia, and Ohio.

The conference provided attendees with an overview of natural gas extraction activities and the state and federal requirements that companies and their subcontractors must follow to ensure that workers, the public and the environment are not put at risk. Conference topics ranged from environmental and financial crimes, first response measures, wastewater disposal, heavy truck enforcement, as well as state and local law enforcement issues.

The Marcellus Shale Law Enforcement Training Conference was supported by the U.S. Environmental Protection Agency (EPA) Criminal Investigations Division, the Federal Bureau of Investigation, Internal Revenue Service Criminal Investigation, Pennsylvania Office of the Attorney General, Pennsylvania District Attorney's Association, Pennsylvania State Police, Pennsylvania Chiefs of Police Association, U.S. Department of Transportation Office of Inspector General, U.S. Fish and Wildlife Service, the U.S. Department of Justice Environmental Crimes Section, Penn State Marcellus Center for Outreach and Research, Lycoming County Department of Public Safety, and the Middle Atlantic-Great Lakes Organized Crime Law Enforcement Network (MAGLOCLEN).

In addition to training sessions by law enforcement and environmental officials, the conference also included presentations by the Marcellus Shale Coalition, the Marcellus Center for Outreach & Research Penn State University, and the Sierra Club.

Sacramento Bank Robber Dubbed the "Goat-Man Bandit" Sentenced to Eight Years and Four Months in Prison

SACRAMENTO, CA—United States Attorney Benjamin B. Wagner announced that yesterday, United States District Court Judge Kimberly J. Mueller sentenced John Raymond Porter, 42, of Sacramento, to eight years and four months in prison, to be followed by three years of supervised release, for serial bank robbery.

This case was the product of an investigation by the Sacramento Violent Crimes Task Force, which includes the Federal Bureau of Investigation and the Sacramento County Sheriff's Office. Assistant United States Attorney Michelle Rodriguez prosecuted the case.

According to court documents, during the early stages of the investigation, the task force dubbed the perpetrator the "Goat-Man Bandit" because the tellers in some robberies indicated the robber had facial hair in the form of a goatee. Porter was convicted of four counts of bank robbery but admitted to committing nine bank robberies:

1. Wells Fargo Bank, 781 Pleasant Grove Boulevard, Roseville, on October 3, 2008;
2. US Bank, 30 High Street, Auburn, on October 23, 2008;
3. Washington Mutual Bank, 5801 Sunrise Blvd., Citrus Heights, on October 23, 2008;
4. Wachovia Bank, 8477 Auburn Boulevard, Citrus Heights, on December 11, 2008;
5. US Bank, 2360 Grass Valley Highway, Auburn, on December 13, 2008;
6. Bank of America, 900 High Street, Auburn, on December 23, 2008;
7. Bank of America, 2221 Douglas Boulevard, Roseville, on January 6, 2009;
8. Bank of America, 3901 Park Drive, El Dorado Hills, on February 17, 2009; and
9. Wells Fargo Bank, 3291 Coach Lane, Cameron Park, on March 2, 2009.

Porter has agreed to pay restitution for the total loss suffered by all nine banks, which amount will be determined at the restitution hearing scheduled for July 21, 2011.

Fugitive Former CEO Arrested in Utah

Rufus Paul Harris was Convicted of Eight Counts of Securities and Wire Fraud After Fleeing During Trial

ATLANTA—The United States Attorney’s Office today announced that RUFUS PAUL HARRIS, 43, originally of Adairsville, Georgia but most recently from Oklahoma City, was arrested on Sunday morning by deputies of the U.S. Marshals Service at a residence in Provo, Utah, after a five-day nationwide manhunt. Harris fled Atlanta on Monday evening, May 23, 2011, after the eighth day of a jury trial in which he was facing charges of securities fraud, wire fraud, falsifying financial statements, and conspiracy. He was convicted of all eight counts. He had been on bond pending resolution of the trial.

In a statement issued today, United States Attorney Sally Quillian Yates said, “I am happy to announce that this defendant was arrested without incident less than a week after he fled. In that short time, the defendant was able to travel nearly 2,000 miles, but that was not far enough for the talented and hard working deputies of the United States Marshals Service and the other federal and local law enforcement agencies that assisted. The defendant, who was convicted of a multi-million stock pump-and-dump fraud scheme, will now find that his problems have gone from bad to worse.”

Deputy United States Marshal Jim Joyner said, “This is a unique case where we were notified promptly that the individual had absconded. Lead Deputy Lorena McCaigue was able to coordinate an interstate investigation utilizing other Marshals Service offices, particularly in Oklahoma and Utah, and local law enforcement, and follow the trail that Mr. Harris unintentionally left. Once she was able to verify his location, she turned over apprehension operations to a U.S. Marshals Service task force in Utah, and the defendant was arrested without incident.”

According to United States Attorney Yates, the charges, and other information presented in court: HARRIS was the founder and chief executive officer of Conversion Solutions Holdings Corporation (“CSHC”); co-defendant BENJAMIN STANLEY, 48, of Kennesaw, Georgia, was the co-founder and chief operating officer; and co-defendant DARRYL HORTON, 50, of Okemos, Michigan, was the chief financial officer. The evidence showed that the three defendants conspired to issue false press releases and financial statements about the company for the purpose of inflating the stock price, while at the same time they were secretly transferring shares to family members who sold at the inflated prices.

The defendants issued a series of press releases publicly claiming that CSHC’s ownership of over a billion dollars in foreign bonds. In October 2006, CSHC issued an annual report claiming as much as $800 million in assets, $500 million of which was in the form of foreign sovereign bonds as stated in at least some of the press releases. Also according to this report and its attachments, CSHC’s income included $19,869,792 in interest revenue from those bonds.

According to the evidence presented in court, the three defendants knew these public statements were untrue, and knew that CSHC had little if any assets of any value and did not own the foreign bonds and other assets that it claimed to have. CSHC also had little if any in the way of revenue or profits from any business activity.

During the weeks that the misrepresentations were being publicly disseminated via press releases and SEC filings, CSHC’s stock price on the open market more than tripled. The stock, which was a “penny-stock” trading for less than $1 per share on the Over-the-Counter Bulletin Board in August 2006, appreciated to more than $3 per share in October 2006. During this time, HARRIS, STANLEY, and HORTON transferred substantial quantities of CSHC stock to family members and others, who sold the stock in the open market at artificially inflated prices of between $2 - $3 per share.

On the first day of the trial, HARRIS waived his right to an attorney, instead electing to represent himself. HARRIS. Investigation by United States Postal Inspectors revealed that on Monday, May 23, 2011, at approximately 6:20 p.m., HARRIS checked out of the motel and exited the parking lot in a dark colored minivan. HARRIS failed to report to court on Tuesday, May 24, 2011, and a warrant for his arrest was issued. The trial proceeded against all three defendants, in HARRIS’ absence. HARRIS was convicted of all eight counts on Thursday, May 27, 2011. STANLEY was also convicted of wire fraud, securities fraud, and conspiracy; and HORTON pleaded guilty while the jury was deliberating to conspiracy.

Defendants HARRIS and STANLEY could receive a maximum sentence of 25 years in prison and a fine of up to $250,000 for the securities fraud charge, 25 years in prison and a fine of up to $250,000 for the conspiracy charge, and 20 years in prison and a fine of up to $250,000 for each count of the wire fraud charges. The false certification of a financial statement charge, as to HARRIS, carries a maximum sentence of 10 years in prison and a fine of up to $1,000,000. Defendant HORTON, by virtue of his plea, will likely receive the maximum sentence of five years’ imprisonment for the count to which he pled guilty, and also faces a fine of up to $250,000. Defendant HARRIS may also face additional charges of bail jumping.

Sentencing is scheduled for August 18, 2011, at 10:00 a.m. before United States District Judge Timothy C. Batten, Sr. In determining the actual sentence, the court will consider the United States Sentencing Guidelines, which are not binding but provide appropriate sentencing ranges for most offenders.

Agents of the United States Postal Inspection Service and Federal Bureau of Investigation were the lead agencies investigating the underlying criminal case, and they provided assistance in the fugitive investigation as well.

For further information, please contact Sally Q. Yates, United States Attorney, or Charysse L. Alexander, Executive Assistant United States Attorney, through Patrick Crosby, Public Affairs Officer, U.S. Attorney’s Office, at (404) 581-6016. The Internet address for the HomePage for the U.S. Attorney’s Office for the Northern District of Georgia is justice.gov/usao/gan.

Monday, May 30, 2011

Five Men Charged in String of Armed Robberies of Latino Small Businesses

ALEXANDRIA, VA—Five men have been indicted by a federal grand jury of engaging in a string of armed robberies of small businesses that primarily service the Latino community in Prince William and Fairfax counties. The men are also charged with conspiracy to commit the armed robberies in Virginia as well as an armed robbery of a Wachovia Bank branch in Horsham, Penn.

Neil H. MacBride, United States Attorney for the Eastern District of Virginia; James W. McJunkin, Assistant Director in Charge of the FBI’s Washington Field Office; Charlie T. Deane, Prince William County Chief of Police; and Colonel David Rohrer, Fairfax County Chief of Police made the announcement.

“These men are accused of spreading fear and violence through armed robberies of Latino businesses throughout Prince William and Fairfax counties,” said U.S. Attorney MacBride. “Armed robbery is a very traumatic experience. The threat of violence is real, and in several instances the weapons were allegedly used to subdue employees or ensure the conspirators’ escape. We are grateful to the excellent work of our local and federal partners in putting together the evidence that made today’s charges possible.”

“This is another outstanding example of cooperation between law enforcement agencies across jurisdictional and state lines,” said Chief Deane of the Prince William County Police Department. “With the use of technology and communication between agencies our ability to apprehend suspects is even greater than before.”

“Violent crime directed at our neighborhood business community endangers lives,” said FBI ADIC McJunkin. “This case was successful because of the hard work and dedication of multiple law enforcement agencies who acted as a cohesive team to intervene against those who threaten our communities.”

According to the indictment and other court records, the five men are accused of participating in a conspiracy that targeted at least six businesses and stole approximately $238,000 in cash and jewelry from August 2010 through February 2011. At each location, conspirators allegedly carried handguns, either brandished a firearm or put a handgun at employees’ heads, and demanded money and other valuables.

Those charged include the following:

■Jesus Garcia-Guinea, 38, of Washington, D.C., who is charged with conspiracy, robbery, use of a firearm during a crime of violence, and being an illegal alien in possession of a firearm.
■Edgar Geovani Zuniga-Perez, a/k/a “Edgar Geovani Suniga-Perez” and “Edgar Geovani Perez-Suniga,” 30, of Woodbridge, Va., who is charged with conspiracy, multiple counts of robbery and use of a firearm during a crime of violence, and also with being an illegal alien in possession of a firearm.
■Vahelo Alay Escobar, 21, of Riverdale, Md., who is charged with conspiracy, robbery, and use of a firearm during a crime of violence.
■Serfido Trinidad Perez Florian, 41, of Riverdale, Md., who is charged with conspiracy, robbery, and use of a firearm during a crime of violence.
■Estanislao Ramos Perez, 28, of Riverdale, Md., who is charged with conspiracy.
A related affidavit details the alleged robbery at Plantanillos Grocery in Prince William County on Dec. 19, 2010. According to the affidavit, three Hispanic males wearing black masks entered the store armed with a firearm. The men allegedly brandished their weapons at the store employees, stole the cash from the registers, and shattered a jewelry case to retrieve the jewelry. One employee was allegedly struck several times on the face and head with a gun. After the robbers exited the store, they allegedly fired shots that hit an employee’s vehicle’s front windshield.

The indictment states that on Feb. 24, 2011, conspirators also allegedly shot at the owner of Sabina’s Joyeria in Fairfax County, Va., as they were fleeing the scene after stealing approximately $5,450 in cash.

The indictment also accuses Zuniga-Perez, Escobar, and Perez Florian and other conspirators of working with individuals later revealed as undercover officers to commit an armed robbery of a Wachovia Bank branch in Horsham, Penn. They allegedly met at a car dealership to select the vehicles to be used in the robbery attempt, conducted surveillance on the bank, and inspected multiple firearms and bullet proof vests they would allegedly use in committing the armed robbery. The undercover officers involved in the investigation were with the Metropolitan Police Department.

This case was investigated by the FBI Washington Field Office, Prince William County Police Department, Fairfax County Police Department, and the Metropolitan Police Department, with assistance from Takoma Park Police Department. Assistant United States Attorneys Patricia Giles and Justin Fairfax are prosecuting the case on behalf of the United States.

Criminal indictments are only charges and not evidence of guilt. A defendant is presumed to be innocent until and unless proven guilty.

A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.

Owner of Cash Rewards, Inc., Accused of $7 Million Fraud

ALEXANDRIA, VA—A federal grand jury late yesterday indicted David Maloy, 57, of Coppell, Texas, for his involvement in a fraud scheme that caused more than $7 million in losses.

Neil H. MacBride, United States Attorney for the Eastern District of Virginia, and James W. McJunkin, Assistant Director in Charge of the FBI Washington Field Office, made the announcement today.

According to the indictment, Maloy owned and operated a company called Cash Rewards, Inc. (CRI), which he marketed to retail businesses as an advertising tool they could use to entice prospective customers with a time-deferred, mail-in cash reward of up to $10,000 with the purchase of an item. To participate in the program, the retail businesses were required to pay a one-time setup fee to CRI of approximately $2,500 and, thereafter, to pay 15 cents on the dollar to the CRI “claim fund” for each cash reward certificate provided to a customer. Recipients of the cash reward certificates were eligible to redeem their certificates for cash after a three-year waiting period.

As part of his sales pitch, Maloy represented that the money paid into the CRI claim fund was placed in an escrow account that was maintained by an independent escrow agent and that CRI had no access to the account. However, the indictment alleges that almost all of the money deposited into the supposed claim fund was transferred to accounts over which Maloy had control. In addition, a significant percentage of money paid by retail businesses that was supposed to be deposited into the claim fund was instead allegedly deposited directly into bank accounts over which Maloy had control. The indictment accuses Maloy of using funds from the CRI claim fund to purchase items such as expensive jewelry, cars, life insurance, and a condominium.

Maloy also represented that an independent third party administrator, rather than CRI, made the sole decision as to whether a cash reward certificate had been properly redeemed. The indictment alleges that in reality, Maloy required that the third party administrator send all certificate packages approved for payment to CRI’s offices so that they could be reviewed by Maloy and other CRI employees. Maloy allegedly made the final decision as to whether a certificate had been properly redeemed and, on some occasions, overturned the third party administrator’s determination that a certificate holder had satisfied the requirements to receive a cash reward.

Maloy is accused of receiving a total of approximately $9.4 million from more than 700 businesses that participated in the CRI program between 2003 and 2009. None of the program participants who were issued cash rewards certificates after May 2006 received payment on their certificates. CRI declared bankruptcy in 2009.

The charges in the indictment include mail fraud, which carries a maximum penalty of 20 years in prison, and money laundering, which carries a maximum penalty of 10 years in prison.

This case was investigated by the FBI’s Washington Field Office. Assistant United States Attorney Marla B. Tusk is prosecuting the case on behalf of the United States.

The public is reminded that an indictment only contains charges and is not evidence of guilt. A defendant is presumed innocent unless and until proven guilty.

A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.

Saturday, May 28, 2011

Owner of Cash Rewards, Inc., Accused of $7 Million Fraud

ALEXANDRIA, VA—A federal grand jury late yesterday indicted David Maloy, 57, of Coppell, Texas, for his involvement in a fraud scheme that caused more than $7 million in losses.

Neil H. MacBride, United States Attorney for the Eastern District of Virginia, and James W. McJunkin, Assistant Director in Charge of the FBI Washington Field Office, made the announcement today.

According to the indictment, Maloy owned and operated a company called Cash Rewards, Inc. (CRI), which he marketed to retail businesses as an advertising tool they could use to entice prospective customers with a time-deferred, mail-in cash reward of up to $10,000 with the purchase of an item. To participate in the program, the retail businesses were required to pay a one-time setup fee to CRI of approximately $2,500 and, thereafter, to pay 15 cents on the dollar to the CRI “claim fund” for each cash reward certificate provided to a customer. Recipients of the cash reward certificates were eligible to redeem their certificates for cash after a three-year waiting period.

As part of his sales pitch, Maloy represented that the money paid into the CRI claim fund was placed in an escrow account that was maintained by an independent escrow agent and that CRI had no access to the account. However, the indictment alleges that almost all of the money deposited into the supposed claim fund was transferred to accounts over which Maloy had control. In addition, a significant percentage of money paid by retail businesses that was supposed to be deposited into the claim fund was instead allegedly deposited directly into bank accounts over which Maloy had control. The indictment accuses Maloy of using funds from the CRI claim fund to purchase items such as expensive jewelry, cars, life insurance, and a condominium.

Maloy also represented that an independent third party administrator, rather than CRI, made the sole decision as to whether a cash reward certificate had been properly redeemed. The indictment alleges that in reality, Maloy required that the third party administrator send all certificate packages approved for payment to CRI’s offices so that they could be reviewed by Maloy and other CRI employees. Maloy allegedly made the final decision as to whether a certificate had been properly redeemed and, on some occasions, overturned the third party administrator’s determination that a certificate holder had satisfied the requirements to receive a cash reward.

Maloy is accused of receiving a total of approximately $9.4 million from more than 700 businesses that participated in the CRI program between 2003 and 2009. None of the program participants who were issued cash rewards certificates after May 2006 received payment on their certificates. CRI declared bankruptcy in 2009.

The charges in the indictment include mail fraud, which carries a maximum penalty of 20 years in prison, and money laundering, which carries a maximum penalty of 10 years in prison.

This case was investigated by the FBI’s Washington Field Office. Assistant United States Attorney Marla B. Tusk is prosecuting the case on behalf of the United States.

The public is reminded that an indictment only contains charges and is not evidence of guilt. A defendant is presumed innocent unless and until proven guilty.

A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.

Manhattan U.S. Attorney Announces Guilty Pleas of Former Hedge Fund Portfolio Manager and NVIDIA Finance Employee to Insider Trading Charges

PREET BHARARA, the United States Attorney for the Southern District of New York, announced that SAMIR BARAI, a/k/a “Sam Barai,” a portfolio manager at two different New York based hedge funds, and SON NGOC NGUYEN, a/k/a “Sonny,” an employee in the finance department of NVIDIA Corporation (“NVIDIA”), pled guilty today in Manhattan federal court to charges arising out of their involvement in separate insider trading schemes. BARAI, who had previously been arrested on February 8, 2011, and charged in a criminal complaint, also pled guilty to additional charges, including obstruction of justice, in connection with the insider trading scheme.

According to the informations to which BARAI and NGUYEN pled guilty, statements made during the plea proceedings, and other court documents:

Between 2006 and 2010, BARAI worked as a portfolio manager at two hedge funds located in New York, New York. During that time period he and his co-conspirators, including DONALD LONGUEUIL, NOAH FREEMAN, JASON PFLAUM, and WINIFRED JIAU, participated in a conspiracy to obtain material, non public information (“Inside Information”). The Inside Information included detailed financial earnings about numerous public companies, including NVIDIA and Marvell Technology Group, Ltd. (“Marvell”). Often, BARAI and his co-conspirators used an “expert networking” firm, (the “Firm”), to communicate with and pay their sources of Inside Information, many of whom were employees of public companies. In addition to their use of the Firm, they also obtained Inside Information from independent research consultants who communicated with employees at public companies.

For example, in May 2008, BARAI allegedly obtained from JIAU Inside Information regarding Marvell’s financial results for the quarter ending on May 3, 2008. Based on that Inside Information, he caused his hedge fund to execute trades in Marvell, realizing trading gains of more than $800,000.

After BARAI and his co-conspirators received Inside Information from their sources, BARAI had regular conference calls with LONGUEUIL and FREEMAN, who worked at other hedge funds, during which they shared the information they learned with each other.

During the course of the insider trading scheme, BARAI destroyed and attempted to destroy documents and electronic records in connection with the scheme. As he admitted at the plea proceeding, after learning about a federal investigation into insider trading, BARAI directed his research analyst to destroy electronic and hard copy documents relevant to the investigation.

In a separate but overlapping insider trading scheme, from 2007 through early 2009, while employed in the finance department of NVIDIA, NGUYEN, along with a co-conspirator (“CC- 1”) employed in the finance department of Marvell, allegedly shared Inside Information with WINIFRED JIAU. In this scheme, they agreed to provide JIAU with Inside Information about NVIDIA and Marvell, which she then allegedly used to trade for her own profit, and also sold to others, including BARAI and FREEMAN. In exchange for the information NGUYEN provided to her, JIAU allegedly agreed to provide NGUYEN and CC-1 with stock tips that she learned from other contacts she had at various companies.

BARAI, 39, of New York, New York, pled guilty before U.S. Magistrate Judge KEVIN NATHANIEL FOX to one count of conspiracy to commit securities fraud and wire fraud, one count of securities fraud based on his trading in Marvell, one count of wire fraud, and one count of obstruction of justice. The conspiracy count carries a maximum sentence of five years in prison, the securities fraud count carries a maximum sentence of 20 years in prison, the wire fraud count carries a maximum sentence of 20 years in prison, and the obstruction count carries a maximum sentence of 20 years in prison. He also faces a maximum fine of $250,000, or twice the gross gain or loss from the offense on the conspiracy count, a maximum fine of $5 million on the securities fraud count, a maximum fine of $250,000, or twice the gross gain or loss from the offense on the wire fraud count, and a maximum fine of $250,000, or twice the gross gain or loss from the offense on the obstruction count. In addition, BARAI agreed as part of his plea agreement to forfeit the amount of proceeds obtained as a result of the offenses. BARAI is scheduled to be sentenced by U.S. District Judge DEBORAH A. BATTS on August 29, 2011.

NGUYEN, 39, of San Jose, California, pled guilty before U.S. District Judge JED S. RAKOFF to one count of conspiracy to commit securities fraud and wire fraud. This count carries a maximum sentence of five years in prison. NGUYEN also faces a maximum fine of $250,000, or twice the gross gain or loss from the offense on the conspiracy count. NGUYEN is scheduled to be sentenced by Judge RAKOFF on November 29, 2011, at 4:00 p.m.

LONGUEUIL, FREEMAN, and PFLAUM previously pled guilty to conspiracy and securities fraud charges. Charges against JIAU remain pending and are merely accusations. She is presumed innocent unless and until proven guilty.

Mr. BHARARA praised the investigative work of the Federal Bureau of Investigation. He also thanked the U.S. Securities and Exchange Commission.

These cases were brought in coordination with President BARACK OBAMA’s Financial Fraud Enforcement Task Force, on which Mr. BHARARA serves as a co-chair of the Securities and Commodities Fraud Working Group. President OBAMA established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.

These cases are being handled by the office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys AVI WEITZMAN and DAVID LEIBOWITZ, and Special Assistant U.S. Attorney ANDREW Z. MICHAELSON, are in charge of the prosecution.

Nuestra Familia Gang Members Convicted in Federal Court Receive Long Sentences

SACRAMENTO, CA—United States Attorney Benjamin B. Wagner announced that Larry Amaro, 44, of Hanford; Ernest Paul Killinger, 33, of Orangevale; Gerardo Mora, 34, of Salinas; and Jason Stewart-Hanson, 37, of Los Banos, were sentenced today by Senior United States District Judge William B. Shubb.

Judge Shubb imposed the following sentences:

Amaro—40 years in prison;
Killinger—36 years and eight months in prison;
Mora—33 years and four months in prison;
Stewart-Hanson—25 years in prison.
Each defendant was convicted on multiple counts of drug trafficking on December 10, 2010, after a lengthy jury trial.

According to the trial evidence, between April 2004 and June 27, 2007, Amaro, Killinger, Mora, and Stewart-Hanson engaged in a long-term drug trafficking conspiracy that was responsible for the transportation and distribution of more than 100 pounds of methamphetamine, 100 kilograms of cocaine, and 200 pounds of marijuana. They operated under the authority of the Nuestra Familia (NF), a violent Hispanic prison gang based within the California prison system whose members exert control over street-level NorteƱo gang members engaged in drug trafficking and violent crime.

This case was the product of an extensive investigation by the FBI's Stockton Violent Crime Task Force, the San Joaquin County Metropolitan Narcotics Task Force (METRO), the Stockton Police Department, the Salinas Police Department, the Watsonville Police Department, the Monterey County Sheriff's Department, and the California Department of Corrections and Rehabilitation. Assistant U.S. Attorneys Jason Hitt and William S. Wong prosecuted the case.

This extensive joint effort was part of an Organized Crime Drug Enforcement Task Force (OCDETF). OCDETF was established in 1982 to conduct comprehensive, multilevel attacks on major drug trafficking and money laundering organizations. Its principal mission is to identify, disrupt, and dismantle the most serious drug trafficking and money laundering organizations and those primarily responsible for the nation's drug supply.

Former Real Estate Professionals Sentenced for Mortgage Fraud Scheme in Vallejo

SACRAMENTO, CA—United States Attorney Benjamin B. Wagner announced that United States District Judge Morrison C. England, Jr. sentenced Ralondria Stafford, 37, of San Francisco, and Necole Ward, 32, of Las Vegas, (both formerly of Vallejo, Calif.) for their roles in a mortgage fraud scheme carried out in Vallejo between 2005 and 2006. Judge England sentenced Stafford to 21 months in prison and Ward to 12 months and a day in prison. The prison sentences are to be followed by three years of supervised release and both defendants were ordered to pay $200,000 in restitution. Stafford and Ward pleaded guilty on June 10, 2010.

This case was the product of a joint investigation by the Federal Bureau of Investigation and the Internal Revenue Service, Criminal Investigation. Assistant United States Attorney Kyle Reardon prosecuted the case.

According to court documents, Stafford and Ward, who are sisters, operated RN Realtors in Vallejo. Between July 2005 and August 2006, they used two straw buyers to purchase properties that they owned in Vallejo. They offered the buyers $5,000 for the use of their names and financial information, and told the buyers that the purchase would be in name only and that Stafford would purchase the properties back in six to 12 months.

In the course of the conspiracy, Stafford and Ward prepared "Uniform Residential Loan Application" forms in the straw buyers' names containing false statements that included overstating of the straw buyer's income, claiming false employment at employers, and misidentifying properties as a primary residence.

At sentencing, Judge England said that the sentences were driven by several justifications, including the need to punish the defendants for their acts of greed and to deter others who might be considering similar conduct. He also cited the fact that both defendants had real estate licenses at the time of their crimes and were therefore aware of the illegal nature of their fraud.

Judge England dismissed Stafford's argument that she should be given a sentence of home confinement so as not to be separated from her 7-year-old son. Judge England told Stafford that had her child been her number one priority at the time she was considering breaking the law, she would not have gotten into trouble. "You made your choice," said Judge England, "now I have to deal with it."

In addressing Ward, Judge England noted that she was highly educated, with degrees from Swarthmore and the University of San Francisco, and her conduct in this case was extremely serious given that she knew that her conduct was illegal and her education made her more culpable than someone who could not appreciate fully the wrongfulness of her acts.

This law enforcement action is part of the work being done by President Barack Obama's Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes. One component of the FFETF is the national Mortgage Fraud Working Group, co-chaired by U.S. Attorney Wagner, which is tasked with combating mortgage fraud schemes. For more information on the task force, visit StopFraud.gov.

Friday, May 27, 2011

Mayor Proclaims Border Patrol Day in Laredo, TX

Laredo, Texas - The United States Border Patrol has a proud history of 87 years of service to our nation. Earlier today, Mayor Raul Salinas declared May 28, 2011; as "Border Patrol Day" in Laredo, TX. The Border Patrol is celebrating 87 years of proud heritage and unwavering service.

Laredo Sector Border Patrol Chief Robert L. Harris and Deputy Chief John C. Esquivel along with members of the Laredo Sector Staff attend the proclamation reading.

Mayor Raul Salinas read the proclamation at City Hall Chambers where Laredo Sector Border Patrol Chief Robert L. Harris and Deputy Chief John C. Esquivel along with members of the Laredo Sector Staff attended the reading.

During the ceremony, Mayor Salinas and Chief Harris asked all present for a moment of silence to honor the brave 113 men and women who made the ultimate sacrifice protecting this great nation.

On May 28, 1924, U.S. Congress passed the Labor Appropriation Act of 1924, officially establishing the United States Border Patrol.

U.S. Customs and Border Protection is the unified border agency within the Department of Homeland Security charged with the management, control and protection of our nation's borders at and between the official ports of entry. CBP is charged with keeping terrorists and terrorist weapons out of the country while enforcing hundreds of U.S. laws.

Federal Court Shuts Down Georgia Tax Return Preparers

Woman at Augusta Firm Allegedly Claimed Fraudulent Earned Income Tax Credits

WASHINGTON – A federal court has permanently barred two women from preparing federal income tax returns for others and from operating their tax preparation business, the Justice Department announced today.   Judge J. Randal Hall of the U.S. District Court for the Southern District of Georgia entered the civil injunction order against Endia Delores Nipper, Jessie Mackie, and their business, TDNS Tax Service, which according to the government complaint, is located in Augusta, Ga. Nipper and Mackie agreed to the entry of the injunction.

In its amended complaint, the government alleged that Nipper fabricated or inflated earned income tax credit claims on tax returns that she prepared for her customers.   The government also alleged that Nipper prepared numerous tax returns claiming the credit but failed to comply with the Internal Revenue Service (IRS)   “due diligence” requirements for verifying whether her customers were eligible for the credit and in what amount.

In the past decade, the Justice Department’s Tax Division has obtained hundreds of injunctions to stop the promotion of tax fraud schemes and the preparation of fraudulent returns.   Information about these cases is available on the Justice Department website.