Kinston Man Charged with Theft from Federally Funded Programs

RALEIGH—United States Attorney Thomas G. Walker announced that today a federal grand jury has returned an eight-count criminal indictment charging Stephen A. LaRoque, 48, of Kinston, North Carolina, with theft concerning programs receiving federal funds, in violation of Title 18, United States Code, Section 666(a)(1)(A), and engaging in monetary transactions involving property derived from certain specified unlawful activity, in violation of Title 18, United States Code, Section 1957.

The maximum penalty for each count is up to 10 years’ imprisonment.

An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty in court.

The case involves a joint investigation by the Internal Revenue Service-Criminal Investigation Division, the United States Department of Agriculture, the Federal Bureau of Investigation, and the North Carolina State Bureau of Investigation.

Wilmington Man Sentenced on Child Pornography Charge

NEW BERN—United States Attorney Thomas G. Walker announced that in federal court yesterday United States District Judge Louise W. Flanagan sentenced Matthew Bryan Warford, 21, to 180 months’ imprisonment, followed by a life time of supervised release. A federal grand jury returned a criminal indictment on October 25, 2011. On February 16, 2012, Warford pled guilty to transportation of child pornography, in violation of Title 18, United States Code, Section 2252(a)(2). According to the indictment on August 22, 2010, Warford transported images of minors engaged in sexually explicit conduct. According to the investigation, in March 2011, law enforcement received a tip from the National Center for Missing and Exploited Children that child pornography had been uploaded to Photobucket.com. Law enforcement tracked the IP address to Warford’s Wilmington, North Carolina residence. While conducting an interview, law enforcement learned that Warford was a registered sex offender from a 2009 conviction.

This case was part of the Project Safe Childhood initiative, a national program aimed at ensuring that criminals exploiting children are effectively prosecuted by making full use of all available law enforcement resources at every level. For more information about this important national project, Project Safe Childhood, go to www.projectsafechildhood.gov.

Investigation of this case was conducted by the National Center for Missing and Exploited Children, the North Carolina State Bureau of Investigation, and the Federal Bureau of Investigation. Assistant United States Attorney Ethan Ontjes is prosecuting the case.

Wilmington Man Sentenced to Over 12 Years in Prison

RALEIGH—United States Attorney Thomas G. Walker announced that in federal court yesterday United States District Judge Terrence W. Boyle sentenced Donald Ray Boston, 39, of Wilmington, North Carolina, to 151 months’ imprisonment followed by three years’ supervised release.

On August 10, 2011, a federal grand jury returned a criminal indictment. On November 3, 2011, Boston pled guilty to possessing with intent to distribute a quantity of heroin.

According to the investigation, in May, 2011, Wilmington Police Vice and Narcotics Detectives received information that Boston was selling heroin in the Wilmington area. During the course of this investigation, it was learned that Boston would acquire the heroin from New York. On June 9, 2011, Wilmington Detectives learned that Boston was returning from New York. Later that day, a traffic stop was conducted of the vehicle in which Boston was a passenger. A narcotics K-9 was allowed to walk around and inside the vehicle. In a backpack belonging to Boston, the dog detected narcotics. A search of the backpack revealed 41 grams of heroin.

This case was brought as a part of an Organized Crime Drug Enforcement Task Force (OCDETF) Operation entitled WoofPack, investigating importers and multi-level distributors of heroin, cocaine, crack cocaine, and gang activity associated with this distribution.

Investigation of this case is being conducted by the Federal Bureau of Investigations (Safe Streets Task Force); the Bureau of Alcohol, Tobacco, and Firearms and Explosives; the North Carolina State Bureau of Investigation; the Wilmington Police Department; the Greenville Police Department; and the New Hanover County Sheriff’s Office. Special Assistant United States Attorney Timothy Severo represents the government. Mr. Severo is a prosecutor with the New Hanover District Attorney’s Office. District Attorney Ben David has assigned him to the United States Attorney’s office to prosecute federal Organized Crime Drug Enforcement Task Force criminal matters.

Wilmington Drug Dealer Sentenced

RALEIGH—United States Attorney Thomas G. Walker announced that in federal court on May 1, 2012, ARTHUR CURTIS KING, 51, of Wilmington, North Carolina, was sentenced by Chief United States District Judge James C. Dever III, to 132 months’ imprisonment.

A federal grand jury returned a criminal indictment on August 10, 2011. On November 29, 2011, KING plead guilty to possession with intent to distribute 100 grams or more of heroin.

Beginning in May, 2010, KING began traveling to New York to acquire heroin for distribution. KING provided the heroin to local gang members who then distributed it in the Wilmington, North Carolina, area. The investigation revealed that KING was responsible for distributing at least 25,000 bags of heroin.

On September 20, 2010, members of the Wilmington Police Department working with the Federal Bureau of Investigation (Safe Streets Task Force) and the North Carolina State Bureau of Investigation received information which led them to believe that KING would be delivering a large quantity of heroin into Wilmington. KING was stopped in a cab on his way from Richmond, Virginia. Law enforcement found 12,000 bags of heroin in his luggage. During the course of the investigation it was determined that KING had made four such trips to New York between May and the time of his arrest.

This case was brought as a part of an Organized Crime Drug Enforcement Task Force (OCDETF) Operation entitled WoofPack, investigating importers and multi-level distributors of heroin, powder and crack cocaine, and gang activity associated with this distribution.

Investigation of this OCEDTF case is being conducted by the Federal Bureau of Investigations (Safe Streets Task Force); the Bureau of Alcohol, Tobacco, and Firearms and Explosives; the North Carolina State Bureau of Investigation; the Wilmington Police Department; the Greenville Police Department; and the New Hanover County Sheriff’s Office. Special Assistant United States Attorney Timothy Severo represents the government. Mr. Severo is a prosecutor with the New Hanover District Attorney’s Office. District Attorney Ben David has assigned him to the United States Attorney’s Office to prosecute federal Organized Crime Drug Enforcement Task Force criminal matters.

Former NCDMV Official Sentenced for Fraud Scheme

NEW BERN—United States Attorney Thomas G. Walker announced that in federal court on February 13, 2012, WILLIAM C. TOMAN, JR., 53, of Fayetteville, North Carolina, was sentenced to 18 months’ imprisonment followed by three years’ supervised release. The court also imposed restitution of $15,000 to be paid to the victims in the case. The court enhanced TOMAN’s sentence due to his attempt to obstruct the investigation.

A criminal information was filed on September 14, 2011, charging three counts of mail fraud, in violation of Title 18, United States Code, Section 1341. On November 14, 2011, TOMAN pled guilty to the charges.

According to the information, in January, 2006, TOMAN was appointed to the position of District Supervisor of the Division of License & Theft Bureau for the North Carolina Department of Motor Vehicles (NCDMV), and stationed in the Fayetteville office. His official duties included choosing how to best utilize NCDMV funds allocated for undercover operations, including control purchases of stolen equipment and motor vehicles, and communicating with insurance company representatives regarding reimbursement. In 2009, TOMAN used his official position to obtain three $5,000 contributions from insurance companies to be used in funding further NCDMV undercover operations, but instead converted the funds to his personal use.

Mr. Walker commented: “At every level of government, officials are invested with authority, with responsibility and with the trust of the citizens of this state. Here, for his own personal gain, the defendant forgot his duty to the citizens. The sentence imposed will serve as a stark reminder to all of us who serve in government that we have a trust to keep with the public.”

Investigation of this case was conducted by the Federal Bureau of Investigation and the North Carolina State Bureau of Investigation. Assistant United States Attorney Dennis Duffy is serving as prosecution for the government.

Raleigh Man Pleads Guilty to Child Pornography Charge

RALEIGH—United States Attorney Thomas G. Walker announced that in federal court yesterday, BILLY CHARLES BURGESS, 66, pled guilty before Chief United States District Judge James C. Dever III, to receipt of child pornography, in violation of Title 18, United States Code, Section 2256(a)(2).

On November 12, 2008, a federal grand jury returned a criminal indictment charging BURGESS.

According to the investigation, on March 30, 2005, a search warrant was executed at the BURGESS’ residence. It was learned that earlier in the month BURGESS had sent three photos, via the Internet, of prepubescent females engaged in sexual acts. During the search, a desktop and a laptop computer were seized. Additionally, four pictures of child pornography were recovered from BURGESS’ computer, which had been downloaded from the Internet.

Because of prior federal convictions in 2000 involving child pornography, at sentencing, scheduled for April 16, 2012, BURGESS faces from 15 to 40 years’ imprisonment followed by up to a life term of supervised release and a fine of up to $250,000.

Investigation of this case was conducted by the Federal Bureau of Investigation, the United States Postal Inspection Service, the North Carolina State Bureau of Investigation, and the Raleigh Police Department. Assistant United States Attorney Ethan Ontjes is serving as prosecutor for the government.

Charlotte Top Stories: Fraudster Sentenced

RALEIGH—United States Attorney Thomas G. Walker announced that in federal court today, Chief United States District Judge James C. Dever III, sentenced ERIC OMAR JONES, 41, of Clinton, North Carolina, to 151 months’ imprisonment followed by five years’ supervised release. Additionally, the court imposed restitution of $142,145.85.

A federal grand jury returned a superseding criminal indictment on February 2, 2011. On April 21, 2011, a jury convicted JONES of all counts of the indictment, which included one count of conspiring to commit bank fraud and to make false statement to influence a bank on a loan, 15 counts of bank fraud, and two counts of making false statements to influence bank loans.

In determining JONES’ sentencing guidelines range, the court found that he had received more than $1 million in gross receipts from financial institutions as a result of the offense. It found that the defendant was the leader of a criminal activity that involved five or more participants or was otherwise extensive. It found that the defendant abused a position of private trust through his interactions with unsophisticated investors. It also found that he obstructed justice through perjurious testimony at his trial.

At trial the government’s evidence showed that between 2002 and 2004, JONES participated in a scheme to defraud Omni National Bank and other banks. JONES used the credit of straw purchasers to obtain loans from Omni National bank in the name of those individuals. He then used that loan money to purchase properties through his company, University of Hard Knocks Investments, Inc., and then immediately resell them to the straw purchasers, whom he referred to as investors. Six straw purchasers testified at trial. David Pikul, the closing attorney who handled these transactions, also testified at trial. On April 11, 2011, Pikul pled guilty to conspiring with JONES to commit bank fraud and to make false statements to an FDIC insured bank. JONES enticed the straw purchasers to participate by promising them that he would make mortgage payments on the properties, take care of repairs, and sell the properties at a profit. These promises were untrue and fraudulent.

Further evidence showed that to obtain loans from Omni and other banks, JONES made numerous false statements on the HUD settlement forms that were submitted to the banks. These forms hid the fact that the bank’s money was being used by JONES’ company to purchase the property. They also often falsely stated that a down payment was being made, when, in fact, there was none. Sometimes the HUD forms falsely stated the seller of the property. As part of this scheme, on at least four occasions, JONES sold the same property to the same straw purchaser a second time for a higher price. In addition, JONES was living in one of the properties he had sold to one of the straw purchasers. He was doing this without her knowledge and without paying any rent or mortgage. This straw purchaser ultimately had to evict him.

JONES, testifying at trial, admitted he had 10 years of experience in the mortgage and real estate industry at the time of the crime. He also admitted receiving and signing many of the false HUDs–knowing they were false. He claimed that the closing attorney, David Pikul, had come up with this idea and had told him that it was a correct way of doing things. He admitted receiving a lot of money through University of Hard Knocks Investments and using that money, considered by him to be his business “profits,” to take several gambling trips to Las Vegas, Atlantic City, South Carolina, and New Orleans.

The Federal Bureau of Investigation and the North Carolina State Bureau of Investigation participated in this investigation. David A. Bragdon and William M. Gilmore represented the United States.

Former Columbus County, N.c., Detention Center Sergeant Pleads Guilty to Civil Rights Violation

WASHINGTON – A former Columbus County, N.C., Sherriff’s Office sergeant pleaded guilty today in federal court in Greenville, N.C., to a civil rights charge related to the assault of a detainee, the Justice Department announced.

 Danny Ray Duncan, 63, pleaded guilty to willfully depriving a pretrial detainee of his constitutional right not to be deprived of liberty without due process of law by placing a detainee at risk of serious harm from other inmates knowingly and with reckless disregard for his safety.

 “When corrections officers knowingly place the people they are charged with protecting at risk of serious harm, they undermine the very fabric of our legal system,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division of the Justice Department.  “The Civil Rights Division will aggressively prosecute these violations of our laws.”

 “The public has placed a great trust in law enforcement, and we must do everything we can to ensure that trust is not broken,” said Thomas G. Walker, U.S. Attorney for the Eastern District of North Carolina.  “Our office remains committed to promoting a high standard of professionalism throughout the law enforcement community in this district.”

 During his guilty plea, Duncan admitted that on Aug. 2, 2010, while working the overnight shift as a sergeant in the Columbus County Detention Center in Whiteville, N.C., he placed a pretrial detainee into a cell knowing there was a substantial risk that the inmates in the cell would assault the detainee.  Duncan further admitted that he acted with deliberate indifference to the risk of assault, and that the detainee suffered bodily injury as a result of the assault.

 Sentencing for Duncan is expected to be scheduled for January 2012.  He faces up to 10 years in prison and a maximum fine of $250,000.

 On Aug. 24, 2011, a federal grand jury in Wilmington, N.C., returned an indictment, charging former inmate Terry Lashavious McMillian, 26, for his role in assaulting the detainee.  The trial of McMillian is set to begin in Greenville on Nov. 8, 2011.

This case was jointly investigated by the Wilmington office of the Federal Bureau of Investigation Charlotte Division and the North Carolina State Bureau of Investigation. The case is being jointly prosecuted by Assistant U.S. Attorney Toby W. Lathan from the U.S. Attorney's Office for the Eastern District of North Carolina and Trial Attorney Ryan R. McKinstry from the Civil Rights Division of the U.S. Department of Justice.

ATF National Response Team Activated to Asheville, NC

One Firefighter Killed and 10 Injured While Suppressing Business Fire

ASHEVILLE, NC – The Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) National Response Team (NRT), along with ATF special agents from the Charlotte Field Division, have entered the investigation of a commercial fire that occurred Thursday, July 28, 2011, at 445 Biltmore Avenue, in Asheville, North Carolina. The NRT responded at the request of the Asheville Fire Department.

Zebedee T. Graham, special agent in charge of the ATF Charlotte Field Division, said that the building housing several medical related businesses was significantly damaged by fire, smoke and water and early estimates of damages are in excess of $1 million. One firefighter was killed and 10 others were injured in the line of duty while suppressing the fire.

The ATFNRT has brought definitive expertise and an array of state-of-the-art equipment to the investigation of major fire and explosives incidents since 1978. Four regional components, organized geographically to cover the United States, comprise the NRT. The team can respond within 24 hours to assist state and local law enforcement or fire service personnel in onsite investigations.

The responding NRT component normally has 18 members, including veteran special agents who have post-blast and fire origin-and-cause expertise; forensic chemists; explosives enforcement officers; fire protection engineers; accelerant detection canines; explosives detection canines; and intelligence, computer forensic and audit support. A fleet of fully equipped response vehicles strategically located throughout the United States provides logistical support. The responding NRT Team Supervisor is Supervisory Special Agent Christopher J. Hyman, who is stationed in Greenville, South Carolina.

ATF’s partnership with federal, state and local officers is vital to the most effective processing efforts at an explosives or fire scene. The NRT capitalizes on that by working alongside its partners in reconstructing the scene, identifying the seat of the blast or the origin of the fire, conducting interviews and sifting through debris to obtain evidence related to the explosion or fire.

In addition to investigating hundreds of large fire and explosives scenes, the NRT trucks were deployed for the 2001 terrorist attack on the Pentagon; the Olympics and other major sporting events in the United States; presidential inaugurations and the national political conventions; and major international conferences.

This is the 6th NRT activation in the Carolinas over the past 3 years, including activations in Spruce Pine, Salisbury, Robbins and Garner, NC and Charleston, SC in 2007. The NRT program began in 1978 and the teams have been activated over 700 times nationwide. Other agencies involved in the investigation are the North Carolina State Bureau of Investigation and the Asheville Fire Department.