CBP Officers make Two Large Marijuana Busts at New Mexico Ports

El Paso, TX – U.S. Customs and Border Protection (CBP) officers working at the Santa Teresa and Columbus ports of entry seized 1,124 pounds of marijuana in two seizures Thursday. The seizures capped off a busy enforcement week which netted area CBP officers more than 3,000 pounds of marijuana.

 “CBP officers are working hard and the results are impressive,” said Ana Hinojosa, Director of Field Operations in El Paso. “Every day they are making a positive contribution to our community by stopping drug smugglers, illegal immigrants, and other violators before they enter the country and cause harm.”

CBP officers at the Columbus port of entry seized 605 pounds of marijuana Thursday morning after a 1997 Dodge pickup truck entered the port from Mexico. CBP officers selected the vehicle for a secondary examination during which an x-ray scan revealed anomalies in the appearance of the vehicle. CBP officers continued their exam and spotted suspicious bundles inside the truck. CBP drug sniffing dog “Bingo” searched the vehicle and gave a positive alert for drugs. CBP officers removed 370 marijuana-filled bricks from the floor, quarter panels, back wall and bed of the truck.

CBP officers arrested the driver of the truck, 29-year-old Eliazar Parra Suarez of Nuevo Casas Grandes, Chihuahua, Mexico. He was turned over to U.S. Immigration and Customs Enforcement HSI special agents to face federal charges including importation of a controlled substance and possession with intent to distribute a controlled substance.

CBP officers at the Santa Teresa port of entry seized 519 pounds of marijuana Thursday afternoon after a 1991Kenworth semi-truck towing a flatbed trailer loaded with another flatbed trailer entered the port from Mexico. CBP officers selected the vehicle for a secondary examination during which an x-ray scan revealed anomalies in the appearance of the shipment. CBP drug sniffing dog “Murphy” searched the trailer and gave a positive alert for drugs. CBP officers drilled into the fifth-wheel area of the trailer and obtained a green leafy substance which tested positive for marijuana. CBP officers removed nine metal boxes from the secret compartment. The boxes contained 519 pounds of tightly compressed marijuana. No arrests were made.

CBP officers working at area ports of entry made a total of 21 drug seizures during the week. The enforcement activity netted 3,085 pounds of marijuana in 19 busts and 14.7 pounds of cocaine in two additional seizures.

CBP officers working at area ports this week recorded 77 immigration violations. Intended immigrants made up a large group of the violators. A total of 44 were identified through thorough document exams. In these cases, individuals will use a legally issued border-crossing card (laser visa) to live or work in the U.S., which is not authorized. Violators generally lose their documents and are returned to Mexico. The balance of the immigration violations included false claims to citizenship, impostors, visa overstays, alien smugglers, counterfeit documents and people entering the country without proper inspection.

CBP officers working at area ports made 15 drug seizures during the week including 993 pounds of marijuana in 14 busts and less than one pound of heroin in one additional seizure.

CBP agriculture specialists working at area ports this week made nine seizures of prohibited food and agricultural items resulting in $2,075 in fines being assessed. Prohibited items seized included pork, bologna, pork tamales, chicharones, apples, guavas, and fresh eggs. These items are prohibited because they pose a threat of illness or disease to people, livestock or the agriculture industry.

CBP officers working at area ports also identified 15 people who were fugitives or otherwise being sought by law enforcement agencies. They also recorded three export violations, one currency seizure, and a live birds seizure. While anti-terrorism is the primary mission of U.S. Customs and Border Protection, the inspection process at the ports of entry associated with this mission results in impressive numbers of enforcement actions in all categories.

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.

CBP Officers Intercept Illicit Currency

Nogales, AZ. — Customs and Border Protection officers assigned to Tucson Field Office seized nearly $261,000 in unreported U.S. currency Tuesday from a woman headed for Mexico through the Dennis DeConcini Port.

Officers conducting outbound inspections selected a 40-year-old Mexican woman and her teen-age son for additional questioning, and a closer examination of their Buick sedan. When officers noticed someone had tampered with the gas tank, they decided to remove it for further inspection. Inside the tank, officers found 21 packages containing $260,640.

The unreported funds and vehicle were processed for seizure. The woman was arrested and turned over to U.S. Immigration and Customs Enforcement’s Homeland Security Investigations. Her son was released to family members without further incident.

Since launching the Southwest Border Initiative in March 2009, unprecedented shifts in staffing and infrastructure at Arizona’s ports have improved the focus and intensity of operations. These shifts are resulting in more narcotics interceptions; while tougher outbound enforcement is yielding record interceptions of unreported currency, weapons and wanted felons.

Individuals arrested are charged with a criminal complaint, which raises no inference of guilt. An individual is presumed innocent until competent evidence is presented to a jury that establishes guilt beyond a reasonable doubt.

CBP's Office of Field Operations is the primary organization within Homeland Security tasked with an anti-terrorism mission at our nation’s ports. CBP officers screen all people, vehicles and goods entering the United States while facilitating the flow of legitimate trade and travel. Their mission also includes carrying out border-related duties, including narcotics interdiction, enforcing immigration and trade laws, and protecting the nation's food supply and agriculture industry from pests and diseases.

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

Duluth Man Sentenced to 90 Months for Interstate Transportation of Stolen Vehicle

MADISON, WI—John W. Vaudreuil, United States Attorney for the Western District of Wisconsin, announced Gale A. Rachuy, 61, of Duluth, Minn., was sentenced on February 3, 2012, by U.S. District Judge William M. Conley to 90 months in federal prison, followed by three years of supervised release, for interstate transportation of a stolen motor vehicle.

Rachuy pleaded guilty to this charge on November 8, 2011, which involved obtaining vehicles in northwestern Wisconsin through the use of worthless checks and transporting the vehicles to Minnesota. His sentence will be served concurrently with a previously imposed Minnesota state sentence.

In sentencing the defendant, Judge Conley departed upward from the otherwise applicable sentencing guideline range of 37 to 46 months because of the defendant’s extensive criminal history. Rachuy has 28 convictions, mostly for fraud. Judge Conley said he was “astounded” by Rachuy’s record and that Rachuy is “the epitome of a white-collar career offender.” The judge went on to say the defendant has shown “no compunction about committing additional crimes,” and that the sentence “is necessary to protect the public from a financial predator.”

The charges against Rachuy were the result of an investigation conducted by the Eau Claire office of the Federal Bureau of Investigation, Superior Police Department, Douglas County Sheriff’s Office, Duluth Police Department, and Carlton County (Minnesota) Sheriff’s Department. The prosecution of this case has been handled by Assistant U.S. Attorneys Stephen P. Sinnott and Grant C. Johnson.

Medical Device Company Smith & Nephew Resolves Foreign Corrupt Practices Act Investigation

Agrees to Pay $16.8 Million Penalty Related to Bribery in Greece

WASHINGTON—Smith & Nephew Inc. has entered into a deferred prosecution agreement with the Department of Justice to resolve improper payments by the company and certain affiliates in violation of the Foreign Corrupt Practices Act (FCPA), the Department of Justice announced today. The matter is part of an investigation into bribery by medical device companies of physicians employed by government institutions.

Smith & Nephew, a Delaware corporation, is headquartered in Memphis, Tenn., and is a wholly owned subsidiary of Smith & Nephew plc, an English company traded on the New York Stock Exchange. The company manufactures and sells medical devices worldwide.

Smith & Nephew acknowledged responsibility for the actions of its affiliates, subsidiaries, employees and agents who made various improper payments to publicly employed health care providers in Greece from 1998 until 2008 to secure lucrative business.

According to the criminal information filed today in U.S. District Court in the District of Columbia in connection with the agreement, Smith & Nephew, through certain executives, employees and affiliates, agreed to sell products at full list price to a Greek distributor based in Athens, and then pay the amount of the distributor discount to an offshore shell company controlled by the distributor. These off-the-books funds were then used by the distributor to pay cash incentives and other things of value to publicly employed Greek health care providers to induce the purchase of Smith & Nephew products. In total, from 1998 to 2008, Smith & Nephew, its affiliates and employees authorized the payment of approximately $9.4 million to the distributor’s shell companies, some or all of which was passed on to physicians to corruptly induce them to purchase medical devices manufactured by Smith & Nephew.

The agreement recognizes Smith & Nephew’s cooperation with the department’s investigation, thorough self-investigation of the underlying conduct, and the remedial efforts and compliance improvements undertaken by the company. As part of the agreement, Smith & Nephew will pay a $16.8 million penalty and is required to implement rigorous internal controls, cooperate fully with the department and retain a compliance monitor for 18 months.

In a related matter, Smith & Nephew reached a settlement today with the U.S. Securities and Exchange Commission, under which Smith & Nephew agreed to pay $5.4 million in disgorgement of profits, including pre-judgment interest.

This case is being prosecuted by Trial Attorney Kathleen M Hamann of the Criminal Division’s Fraud Section with assistance from the FBI Washington Field Office’s dedicated FCPA squad.

The Justice Department acknowledges and expresses its appreciation for the assistance provided by the authorities of the 8th Ordinary Interrogation Department of the Athens Court of First Instance (international police) and the Athens Economic Crime Squad in Greece, as well as the significant coordination with and assistance by the Securities and Exchange Commission’s Division of Enforcement.

Dhafir Ordered to Serve 264-Month Jail Term on Resentencing

Sentence Mirrors Original Sentence Received in 2005 Following Four-Month Trial in Syracuse

SYRACUSE, NY—United States Attorney Richard S. Hartunian announced this afternoon that U.S. District Judge Norman A. Mordue today resentenced Rafil Dhafir, a former physician from Manlius, New York, to a term of 264 months in jail, and ordered him to pay $865,272.76 in restitution. A Syracuse jury had found Dhafir guilty on 59 federal counts following a four-month jury trial in 2004-2005. Today’s rehearing was conducted following a decision by the United States Court of Appeals for the Second Circuit that asked District Judge Mordue to consider an alternative way of calculating Dhafir’s sentence. The sentence imposed today mirrors the original sentence imposed by Judge Mordue at Dhafir’s sentencing in 2005.

Dhafir’s 59 felony convictions included violations of the U.S. sanctions against Iraq (a national security violation), a multi-million-dollar money laundering conspiracy, substantive money laundering offenses, a conspiracy to impair and impede the operation of the Internal Revenue Service (IRS), causing the filing of a false tax document, tax evasion, visa fraud, health care fraud, false statements, and mail fraud and wire fraud (defrauding donors to his purported charity Help The Needy). In re-sentencing Dhafir, Judge Mordue emphasized that Dhafir’s criminal conduct involved multiple violations of law which took place throughout a four-year period. Judge Mordue also pointed out that Dhafir could have accomplished his humanitarian goals without violating the law if he had chosen to do so. Accordingly, the court concluded that the sentence originally imposed was sufficient, but not longer than necessary, taking into account all of the relevant sentencing factors.

The case was investigated by the Federal Bureau of Investigation, the Internal Revenue Service, the Social Security Service-Office of Inspector General, the United States Postal Inspection Service, the Defense Criminal Investigative Service, the Department of Health and Human Services, and the New York State Police. The prosecution was handled by the Syracuse Office of the U.S. Attorney’s Office for the Northern District of New York.

Collecting DNA from Juveniles

This report examines the laws, policies, and practices related to juvenile DNA collection, as well as their implications for the juvenile and criminal justice systems. This report considers the following questions:

1. How have state agencies, including juvenile justice agencies and state
laboratories, implemented juvenile DNA collection laws?
2. What are the number and characteristics of juveniles with profiles included in CODIS?
3. How have juvenile profiles in CODIS contributed to public safety or other
justice outcomes?
4. What improvements to policies and practices should be made?

This report is the result of an NIJ-funded project but was not published by the U.S. Department of Justice.

Read the Report
Collecting DNA from Juveniles (PDF)

Pharmacy Owner Pleads Guilty to Conspiring to Commit Health Care Fraud

MCALLEN, TX—Sara Elicia Garza, 55, of Mission, Texas, has been convicted of conspiracy to commit health care fraud, United States Attorney Kenneth Magidson announced today along with Texas Attorney General Greg Abbott. Garza is a pharmacist and the owner and operator of Sara’s Pharmacy and Gift Corner located in Mission.

Garza pleaded guilty to conspiracy to commit health care fraud at a hearing held earlier today before U.S. District Judge Randy Crane. At that hearing, Garza admitted she participated in the conspiracy to defraud the Texas Medicaid/Vendor Drug program by submitting false and fraudulent claims for prescription medication that was not dispensed or provided. Specifically, Garza admitted the claims were false and fraudulent for one or more of a variety of reasons—medications were never provided or dispensed, the beneficiary had never seen the physician purporting to prescribe the medication, prescription medications were written for the treatment of medical conditions that the beneficiary did not have, claims were for refills of prescription medications authorized by a physician but which the beneficiary did not request and did not receive, and/or that the prescription medications were never dispensed to beneficiaries but were billed (referred to as “running extras” by Garza and her co-conspirators) in lieu of collecting co-pay for prescriptions that were actually dispensed or in lieu of collecting money for purchases from the Sara’s Pharmacy Gift Store.

Garza also admitted that to cover up the fraud and conspiracy, she and her co-defendant, Valerie Flores, 38, also of Mission, along with other unindicted co-conspirators, forged prescriptions, doctors’ signatures on prescriptions, patients’ signatures on logs that purportedly indicated that a customer beneficiary had received medications, and altered pharmacy records. Flores previously pleaded guilty to conspiracy to commit health care fraud on Dec. 16, 2011, and is scheduled for sentencing April 5, 2012.

Garza faces a maximum punishment of 10 years in prison and up to a $250,000 fine plus up to three years of post-prison supervised release. Her sentencing hearing is set for April 16, 2012. Garza was permitted to remain on bond pending sentencing, at which time the court will also decide the amount of restitution to be ordered in the matter.

In July 2011, agents from the FBI and the Medicaid Fraud Control Unit of the Texas Attorney General’s Office executed a federal search warrant and seized documents and computers at Sarah’s Pharmacy and Gift Store. The pharmacy closed on or about Oct. 28, 2011.

The investigation leading to the charges in this case was conducted by the FBI and the Texas Attorney General’s Medicaid Fraud Control Unit. Assistant United States Attorney Casey N. MacDonald and Special Assistant United States Attorney Rex G. Beasley are prosecuting the case.

Baltimore Financial Adviser Sentenced in Scheme to Defraud Vulnerable Clients of $838,350

Stole from a Trust Held for a Child Suffering from Cerebral Palsy, from the Child’s Mother and from an Elderly Woman

BALTIMORE—U.S. District Judge Catherine C. Blake sentenced Ralph Edward Thomas, Jr., age 53, of Reisterstown, Maryland, today to four years in prison followed by three years of supervised release for mail fraud in connection with defrauding his clients. Judge Blake also ordered Thomas to pay $838,350.34 in restitution, the amount of loss suffered by his clients, and to forfeit property in order to pay such amount, including funds held in investment accounts owned by Thomas, his home in Reisterstown and luxury automobiles.

The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Richard A. McFeely of the Federal Bureau of Investigation; and Chief James W. Johnson of the Baltimore County Police Department.

According to Thomas’ plea agreement, a trust account was established in 1994 to benefit a child suffering from cerebral palsy. The child’s mother was appointed as the trustee. The trust account was funded by the proceeds of a $3 million medical malpractice settlement, which were used to buy an annuity. The annuity was supposed to pay the child a minimum of $3,990 a month.

Thomas was a vice president of Harbor Financial Services, a subsidiary of Harbor Bank. After meeting the child’s mother at Harbor Bank in December 2001, Thomas established complete control over the child’s trust account, which was moved to the Harbor Bank. From December 17, 2001 through June 30, 2010, the annuity payments were deposited directly into the trust account. Although the annuity payments averaged $6,287.53 per month, Thomas disbursed only $1,000 to $1,500 a month from the trust account to the mother for the care of the child. He withdrew the remaining monthly balance by obtaining the mother’s signature on blank withdrawal slips, and deposited the funds into his personal bank accounts. Thomas withdrew a total of $756,963.98 from the trust account which he used for his personal benefit. Thomas purchased a home in Reisterstown, Maryland on July 30, 2009 using $100,000 of the stolen funds.

Furthermore, from June 2006 to May 2009, Thomas obtained three mortgages totaling $205,000 on the mother’s home in her name without her permission. As a result, the mother incurred $26,886.36 in closing costs and losses. Thomas also stole $12,500 from the mother’s personal account held at Harbor Bank.

Finally, from February 2004 through July 2010, Thomas was employed as a financial adviser by Wells Fargo Advisors, LLC. Thomas admits that $75,000 was fraudulently withdrawn from an account held by an elderly Wells Fargo customer. Of the $75,000 withdrawn, $42,000 was used to pay Thomas’ personal credit card accounts or other personal benefits.

United States Attorney Rod J. Rosenstein praised the FBI and Baltimore County Police Department for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorney Gregory R. Bockin, who prosecuted the case.

New Haven Man Sentenced to Two Years in Federal Prison for Distributing Crack

David B. Fein, United States Attorney for the District of Connecticut, announced that RAYMOND RICE, 41, of New Haven, was sentenced today by Senior United States District Judge Ellen Bree Burns in New Haven to 24 months of imprisonment, followed by three years of supervised release, for distributing crack cocaine.

This matter stems from a joint law enforcement investigation conducted by the FBI New Haven Safe Streets Task Force, the DEA New Haven Task Force, the New Haven Police Department and the Hamden Police Department. Through the use of court-authorized wiretaps, investigating officers identified and dismantled a large drug-trafficking organization that was centered in the Newhallville section of New Haven and Hamden, and was responsible for the distribution of crack cocaine and cocaine throughout the Greater New Haven area.

According to court documents and statements made in court, from June 2010 through October 2010, RICE was intercepted several times over a wiretap ordering distribution quantities of crack cocaine from other members of the drug trafficking organization, which he then sold to his own customer base for profit.

On April 21, 2011, RICE pleaded guilty to one count of conspiracy to possess with intent to distribute cocaine base (“crack cocaine”).

Forty-seven individuals have been charged in federal court with various narcotics offenses as a result of this investigation.

This matter was investigated by the Federal Bureau of Investigation’s New Haven Safe Streets Task Force (composed of members of members of the New Haven, Ansonia, Milford and East Haven Police Department, and the Connecticut State Police and the Connecticut Department of Correction), the Drug Enforcement Administration’s New Haven Task Force (composed of members of the New Haven, West Haven, Meriden, Ansonia, Hamden and Branford Police Departments), along with substantial participation by members of the New Haven and Hamden Police Departments. The United States Marshals Service also has assisted the investigation.

The investigation was funded in significant part by the United States Attorney’s Office Organized Crime Drug Enforcement Task Force and supported by the Office’s Project Safe Neighborhoods and Anti-Gang programs.

This matter is being prosecuted by Assistant United States Attorneys Christopher M. Mattei and Robert M. Spector.

Nine Indicted for Conspiring to Receive, Distribute, and Possess Child Pornography

WASHINGTON—Nine men have been indicted in the Western District of Virginia for allegedly conspiring to receive, distribute, possess, and access with intent to view child pornography, Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division, U.S. Attorney Timothy J. Heaphy of the Western District of Virginia and Assistant Director Gordon M. Snow of the FBI’s Cyber Division, announced today.

An indictment returned under seal on Jan. 25, 2012, and unsealed today, charges Jesse Leon Coleman, 47, of Lynchburg, Va.; Thomas Syfor, 71, of Bethlehem, Pa.; Matthew Ackerman, 49, of Bethlehem, Pa.; Peter Franklin Ortiz, 56, of Greenville, S.C.; Manuel Antonio Mares, 56, of Miami; Jeremy Hart Yost, 25, of West Bend, Ore.; Richard Phillip Allen, 65, of Redondo Beach, Calif.; and James Calvin Boyd, 58, of Pell City, Ala., with one count of conspiring to receive, distribute, possess and access with the intent to view child pornography. Coleman is also charged with one count of receiving child pornography and one count of accessing with intent to view child pornography. The ninth defendant, known as “Andy Danilov,” is believed to reside in Russia.

Coleman, Ortiz, Yost and Boyd were arrested yesterday, and Allen self-surrendered to authorities yesterday. Syfor, Ackerman and Mares were arrested at earlier dates.

According to the indictment, beginning in August 2010, Danilov distributed e-mails to a group of individuals, including the defendants, that allegedly contained links to compressed files and file attachments depicting minors engaged in sexually explicit conduct. Danilov often used the screen name “Cinemaboy” in the e-mails.

If convicted, each defendant faces a maximum penalty of 20 years in prison, a $250,000 fine and lifetime supervised release on the conspiracy count. In addition, Coleman faces a maximum penalty of 20 years in prison, a $250,000 fine and lifetime supervised release on the receipt count and 10 years in prison, a $250,000 fine and lifetime supervised release on the access count.

The investigation of the case was conducted by the FBI Innocent Images Operations Unit. The case is being prosecuted by Assistant U.S. Attorney Nancy Healey of the Western District of Virginia and Trial Attorney Chantel Febus of the Child Exploitation and Obscenity Section in the Justice Department’s Criminal Division.

An indictment is only a charge and not evidence of guilt. Defendants are innocent until proven guilty beyond a reasonable doubt.

Federal Jury Convicts Husband and Wife in Conspiracy to Embezzle from City of Garland, Texas

Five Defendants Previously Convicted in This Conspiracy That Caused a Nearly $2 Million Loss to the City

DALLAS—Following a three-day trial before Chief U.S. District Judge Sidney A. Fitzwater, late yesterday a federal jury convicted Kenneth Wayne Brown and his wife, Leah Michele Brown, of Westminster, Texas, for their roles in a conspiracy to embezzle funds from the City of Garland, Texas, announced U.S. Attorney Sarah R. Saldaña of the Northern District of Texas. They were each convicted on one count of conspiracy to commit theft from a program receiving federal funds and each faces a maximum statutory sentence of five years in prison, a $250,000 fine and restitution. Both Kenneth Brown, 50, and Leah Brown, 46, remain on bond. Their sentencing hearings are set for May 18, 2012.

Five defendants have previously been convicted for their roles in the conspiracy. In early December 2011, Duane Milford Stailey, 44, and his wife, Sharon Ware Stailey, 46, both of Leonard, Texas, pleaded guilty to the same conspiracy charge and are scheduled to be sentenced on March 2, 2012 by Judge Fitzwater. In early October 2011, Jerry Don Diviney, 69, of Durant, Oklahoma, pleaded guilty and will be sentenced on March 9, 2012.

The former risk management adjustor for the City of Garland, Patricia Leathers, 63, of Rowlett, Texas, pleaded guilty in December 2010 and is presently serving a 57-month sentence. Her sister, Connie M. Powell, 60, of Garland, pleaded guilty to her role involving checks exceeding $64,000, resulting in a three-year term of probation.

According to trial testimony and case documents, Leathers obtained checks issued by the City of Garland by submitting false claims for reimbursement for damage to vehicles, homes, and landscaping purportedly caused by City trucks or employees. Diviney provided Leathers with names and addresses to use for the false claims and deposited or cashed many of the checks. He then shared the proceeds with Leathers. The Browns and the Staileys negotiated checks payable to themselves and others and returned the bulk of the cash to Diviney and Leathers. The total loss to the City has been determined to be $1,968,479.

The investigation was conducted by the FBI, the Garland Police Department and the Garland Offices of the City Attorney and Internal Auditor. Assistant U.S. Attorneys Katherine Miller and Brian McKay are prosecuting.

Four Pounds of Methamphetamine Seized in Washington County

GREENEVILLE, TN—A multi-agency investigation resulted in the arrest of six persons on January 31, 2012, after law enforcement agents found four pounds of methamphetamine at a rural Washington County, Tennessee home. All six were arrested on complaints relating to their immigration status, made their initial appearances on February 1, 2012, and detained pending their arraignment which is scheduled for February 15, 2012, at the James H. Quillen Federal Courthouse in Greeneville, Tennessee.

The six individuals were Jose Cruz Guevara-Cazarez, 55; Rosalva Guadalupe Robeldo, 48; Arnoldo Ayala Guevara,49; Habraham Enrique Guevara, 26; Emilio Beltran Sanchez, 31; and Enrique Rivas, 33. Guevara-Cazarez, Robledo, and Habraham Enrique Guevara lived in Limestone, Tennessee; Arnold Guevara, Sanchez, and Rivas lived in Oklahoma City, Oklahoma. All except Rivas are natives of Culiacan, Sinaloa, Mexico.

“This case falls within the wide range of transnational crimes that are tailor made to be dealt with using HSI’s numerous authorities,” said Raymond R. Parmer, Jr., Special Agent in Charge of Homeland Security Investigations (HSI) in New Orleans. “This joint investigation demonstrates to individuals who think they can commit such acts without repercussions that HSI and our law enforcement partners are committed to ensuring the integrity of our governmental systems, and constant vigilance over our national security.”

United States Attorney William C. Killian noted, “The cooperative efforts of federal, state and local law enforcement were critical in effectuating these arrests.”

The agencies which participated in the arrests include the Federal Bureau of Investigation, Drug Enforcement Administration, Homeland Security Investigations, the First Judicial District Drug Task Force, the Washington County Sheriff’s Office, the Johnson City Police Department, the Greene County Sheriff’s Office, and the Greeneville Police Department.

Members of the public are reminded that these are only charges and that every person is presumed innocent until their guilt has been proven beyond a reasonable doubt.

Two Principals of Collapsed Foreign Currency Trading Firm Sentenced to Federal Prison for $17 Million Fraud Scheme

CHICAGO—Two principals of a foreign currency trading firm that collapsed in 2007 were sentenced to 17 years and 12.5 years in federal prison, respectively, after pleading guilty to fraud charges for operating a Ponzi-type scheme that diverted millions of dollars to themselves to finance lavish lifestyles and that caused more than 1,000 victim investors worldwide to lose nearly $17 million. Charles G. Martin, 46, formerly of Glencoe, Ill., and Malibu, Calif., was sentenced today to 204 months, while John E. Walsh, 63, of Lake Forest, Ill., was sentenced yesterday to 150 months in prison. Both men were arrested and charged in January 2009 and subsequently cooperated with the government and pleaded guilty in May 2011 to wire and commodities fraud and tax evasion counts. The sentences were announced by Patrick J. Fitzgerald, United States Attorney for the Northern District of Illinois; Robert D. Grant, Special Agent in Charge of the Chicago Office of the Federal Bureau of Investigation; and Alvin Patton, Special Agent in Charge of the Internal Revenue Service Criminal Investigation Division in Chicago.

The sentences were imposed by U.S. District Judge Virginia Kendall, who also ordered mandatory restitution of $16,976,554, jointly and severally, against both defendants. The judge also granted a forfeiture judgment against Walsh for $10 million and indicated that she will enter a similar order against Martin. The government has so far recovered in excess of $1 million from the liquidated proceeds of the defendants’ seized assets and personal property, as well as from bank accounts, safety deposit boxes, and third-party recipients of fraudulently obtained funds.

Walsh was ordered to begin serving his sentence on March 28 and Martin on March 29.

Martin and Walsh were principals of One World Capital Group, LLC, which was formed in 2005, and was based in Winnetka, Ill., with an office in New York. In December 2007, the Commodity Futures Trading Commission obtained a court order prohibiting further trading activity and freezing the firm’s remaining assets, which totaled $677,932. At the same time, One World had approximately $17,654,486 in unpaid customer liabilities. The CFTC and the National Futures Association assisted in the investigation.

According to the court documents, Martin acted as a principal of One World, even though he was prohibited from holding such a position with a National Futures Association member, and Walsh served as the president and primary manager of the trading firm. They marketed over the counter foreign currency (“forex”) trading services in which they were to serve as the customers’ counterparty. In reality, however, One World’s trading platform operated as a front to placate customers whose margin funds were being systematically misappropriated by them. They concealed the misappropriation from customers, as well as government and industry regulators, by making false representations. For example, they solicited new customers without telling them that the value of their investments with One World would be immediately diminished upon deposit due to a shortfall in One World’s customer trading account.

The defendants used customer funds they misappropriated to finance extravagant lifestyles. Credit card and bank records show that Martin spent more than $1 million at a strip club and restaurants, nearly $1 million at elite hotels and another $1 million renting flight time on private jets. He purchased a fleet of luxury vehicles, donated hundreds of thousands of dollars to celebrity charity events, and hired personal security guards to accompany him in public. Similarly, Walsh used his One World credit card to charge personal expenses, including more than $140,000 of jewelry. He also used $70,000 in One World funds for country club expenses and $1,425,000 to purchase a second home in Lake Forest.

In January 2009, federal agents searched Martin’s residence on Sheridan Road in Glencoe and Walsh’s residence on Wharton Drive in Lake Forest, and seized dozens of items from Martin, including fine watches and jewelry, antique furniture, oriental rugs, a piano, artwork, and various high-end electronics. From Walsh, agents seized jewelry, cash proceeds from the sale of his former residence on Salisbury Lane in Lake Forest, and a BMW that he transferred to his son.

In addition to the luxury items they lavished upon themselves, bank records showed that Martin and Walsh spent significant amounts of funds diverted from One World to help finance the production of a motion picture that had listed Martin as a contributing producer. In 2007, bank records show that Martin and Walsh spent more than $500,000 on the movie.

The government is being represented by Assistant U.S. Attorney Joel Hammerman.

The case falls under the umbrella of the Financial Fraud Enforcement Task Force, which 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. For more information on the task force, visit: StopFraud.gov.

Photo Released in Second Comerica Bank Robbery

The FBI Bank Robbery Task Force needs your help in identifying the man who robbed the Comerica Bank located at 2337 West Holcombe in Houston, Texas, earlier today. It was the second robbery of a Comerica Bank location in Houston today. The two robberies do not appear to be related at this time.

At approximately 1:05 p.m., the man entered the bank and approached a teller. He initially pretended to conduct legitimate bank business, then handed the teller a note which demanded money and threatened he had gun. The robbery verbally repeated the demand and threatened to pull out a weapon. No weapon was observed by the teller. The teller provided the robber with some cash. No one was physically hurt during the robbery.

The bank robber is described as a black male, 20-25, 5’8”-5’9” tall, with an average build, light complexion, and clean shaven. He wore a black business suit, white shirt, black tie, black sunglasses, and a Rice University baseball cap.

Crime Stoppers of Houston is offering up to $5,000 for information leading to the charging and arrest of this robber, or any felony suspect. If you have information about this crime, please call the Crime Stoppers Tip Line at 713-222-TIPS (8477), or the Houston office of the FBI at 713-693-5000.

East Greenwich, New Jersey Man Sentenced to 20 Years in Prison for Offering Child Rape Videos on Internet

CAMDEN, NJ—An East Greenwich, N.J., man was sentenced today to 240 months in prison for advertizing child pornography for others to download over the Internet, including videos of infants being sexually assaulted, U.S. Attorney Paul J. Fishman announced. Robert J. Paratore, 47, previously pleaded guilty to an information charging him with one count of advertising and offering to share child pornography. Paratore entered his guilty plea before U.S. District Judge Jerome B. Simandle, who also imposed the sentence today in Camden federal court.

According to documents filed in this case and statements made during Paratore’s guilty plea proceeding:

From at least as early as May 29, 2009, Paratore, who was then the CFO of Akers Biosciences, Inc., used his work computer in Thorofare, N.J., to download computer files that contained child pornography—including images of prepubescent children and infants engaged in sexually explicit conduct. Paratore then advertised his 76 gigabyte collection and shared the images with others over the Internet using peer-to-peer file-sharing—communication via special software which makes it possible for computers to link together over the Internet to form a network for sharing digital files between users.

Law enforcement officials who executed a search warrant at Paratore’s place of employment in Thorofare found child pornography on his work computer and over 100 CDs or DVDs of the material in his truck parked outside.

Paratore acknowledged that the images and videos he made available included depictions of children who were clearly minors. The titles of the files offered by Paratore, such as “!!!NEW tod rape.1. mpg,” graphically described the ages of the victims and the acts of sexual assault which had been recorded.

In addition to the prison term, which took into account Paratore’s prior federal conviction for possession of child pornography, Judge Simandle sentenced Paratore to a lifetime of supervised release. As part of his guilty plea, Paratore agreed to forfeit the computers that he used to commit the offense as well as 167 CDs and DVDs and a two gigabyte thumb drive containing child pornography. Paratore has also agreed to disclose information to law enforcement about eight individual victims he personally sexually abused. Those investigations are continuing. Paratore is also required to register as a sex offender.

U.S. Attorney Fishman credited special agents of the FBI’s South Jersey Resident Agency, under the direction of Special Agent in Charge George C. Venizelos; investigators with the Gloucester County Prosecutor’s Office, under the direction of Prosecutor Sean F. Dalton; and the West Deptford and Monroe Township Police Departments with the investigation leading to the sentence.

The government is represented by Assistant U.S. Attorney Jacqueline M. Carle of the U.S. Attorney’s Office Criminal Division in Camden.

Defense counsel:

Assistant Federal Public Defender Maggie F. Moy Esq., Camden

Ten-Year Sentences Handed Down to Men Who Grew Marijuana in the Chequamegon-Nicolet National Forest

MADISON, WI—John W. Vaudreuil, United States Attorney for the Western District of Wisconsin, announced that Cesar Tinoco, 21, Abraham Ramirez, 29, and Jorge Lopez-Ontiveros, 25, all citizens of Mexico, were each sentenced this week by U.S. District Judge Barbara B. Crabb to 10 years in federal prison for their involvement in a conspiracy to manufacture marijuana in the Chequamegon-Nicolet National Forrest during 2011. All three men pleaded guilty to the conspiracy charge in November of 2011.

Evidence summarized by the government at the plea hearings established that Tinoco, Ramirez and Lopez-Ontiveros were apprehended in early August 2011 along with Jose Esqueda-Garcia, 19, of Mexico, Moises Lopez-Ontiveros, 21, of Mexico, and Norberto Burciaga, 40, of St. Paul, Minnesota, after the marijuana grow they tended in the forest was raided by more than 200 law enforcement officers from over a dozen different local, state, and federal agencies. The grow location had initially been discovered in November of 2010 by hunters who reported the find to police. Police monitored the area in 2011 to determine if persons involved in the grow would return to use the area again. After months of monitoring and surveillance, law enforcement officers raided the campsite of the suspected growers and seized over 9,400 marijuana plants that had been planted, fertilized, and watered by the men. Initially, four of the five men at the camp eluded capture until the following day when Burciaga arrived from Minnesota to pick them up. Sawyer County deputies observed Burciaga’s truck, which investigators were familiar with based on the surveillance over the summer, and stopped it as it headed back toward Minnesota, apprehending Burciaga and four of the suspects who had fled and stayed in the forest overnight.

The three remaining defendants, Norberto Burciaga, 40, St. Paul, Minn., Jose Esqueda-Garcia, 19, Mexico, and Moises Lopez-Ontiveros, 21, Mexico, will be sentenced within the next two weeks.

The charges against the defendants were the result of an investigation by the Wisconsin Department of Justice-Division of Criminal Investigation; Ashland County Sheriff’s Department; Drug Enforcement Administration; U.S. Forest Service; Federal Bureau of Investigation; Wisconsin Department of Natural Resources; Northwest Area Crime Unit (comprised of Sawyer, Douglas and Washburn County Sheriffs’ Departments and Superior Police Department); U.S. Customs and Border Protection; and Great Lakes Indian Fish & Wildlife Commission. The prosecution of the case has been handled by Assistant U.S. Attorney Robert A. Anderson.

Potomac, Maryland Man Sentenced for Wire Fraud

OXFORD, MS—Felicia C. Adams, United States Attorney for the Northern District of Mississippi, and Daniel McMullen, Special Agent in Charge of the Federal Bureau of Investigation (FBI) in Mississippi, announce that:

Sanjeet “Sonny” Veen, 47, of Potomac, Maryland, was sentenced today by United States Senior District Judge Glen H. Davidson in Oxford, following his guilty plea last year to a charge of wire fraud. Judge Davidson ordered Veen to serve 40 months in prison, followed by three years’ supervised release. He was also ordered to pay restitution in the amount of $6,890,000 to Cambridge Trading, in care of Dunlap & Kyle Company, Inc.

At his plea hearing, Veen admitted to taking orders from Dunlap & Kyle for tires from foreign manufacturers, submitting deceptive invoices for tires never received, and receiving payment for said tires.

“Left unchecked, corporate fraud threatens our economy, workforce, and consumers,” stated Daniel McMullen, Special Agent in Charge of the FBI in Mississippi. “The sentence of Sanjeet Veen is the result of the persistence and dedication of the agents, analysts, and prosecutors who worked on this complex case, and I applaud their efforts.”

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

DME Business Owner Lands in Federal Prison for 10 Years for Health Care Fraud and Identity Theft Scheme

Court Considered Additional Evidence Related to Obstruction of Justice

MCALLEN, TX—Juan De Leon, 41, of Edinburg, Texas and owner of United DME Inc., was sentenced today to 120 months in federal prison without parole for his role in a health care fraud and identity theft scheme, United States Attorney Kenneth Magidson and Texas Attorney General Greg Abbott announced today.

Following a four-day trial and approximately an hour of deliberations in late September 2011, a federal jury in McAllen convicted De Leon on charges of conspiracy, health care fraud, and aggravated identity theft related to his scheme to submit fraudulent claims to Medicare and Medicaid for a variety of medical items including power wheelchairs and diabetic supplies. At a hearing this morning, U.S. District Judge Randy Crane, who presided over the trial, sentenced De Leon to 120 months in federal prison, the statutory maximum prison sentence for health care fraud, and ordered him to pay $750,000 in restitution to Medicare and Medicaid. De Leon will also have to serve a three-year term of supervised release upon completion of his prison term.

De Leon owned and operated United DME Inc.—a durable medical equipment (DME) company located in Weslaco, Texas. During the trial, the United States presented evidence that from 2007 through 2010, De Leon directed his employees to submit false and fraudulent claims to Medicare and Medicaid for power wheelchairs that were not delivered and for diabetic supplies and other medical items that were not delivered. The jury heard evidence that instead of providing the medically necessary power wheelchairs prescribed by the patients’ doctors, De Leon would instead provide the patients with less expensive, and more difficult to operate, scooters that they could not use. In other cases, De Leon or his staff submitted claims to Medicare and Medicaid for medical items allegedly delivered after the beneficiary had passed away. According to evidence at trial, De Leon attempted to conceal the scheme by altering records contained within patient files including backdating delivery tickets and forging patient signatures on delivery tickets.

At today’s sentencing hearing, the United States presented additional evidence that during the investigation and prosecution of the case, De Leon obstructed justice by altering and forging patient files prior to producing them to investigators. In addition, De Leon attempted to influence and intimidate government witnesses by instructing them to lie to investigating agents about various matters.

Previously on bond, De Leon was ordered into federal custody following the jury’s verdicts in September where he has remained and will remain pending transfer to a Bureau of Prisons facility to be determined in the near future.

This case was investigated by the FBI, U.S. Department of Health and Human Services-Office of Inspector General, and the Texas Attorney General’s Medicaid Fraud Control Unit. Assistant United States Attorney Greg Saikin and Special Assistant United States Attorney Rex Beasley prosecuted the case.

10 Tips to Avoid Being Scammed by Unscrupulous Practices in the Used Car Industry

The following post appears courtesy of Ken Jost, Deputy Director, Consumer Protection Branch, Civil Division

A man in Seattle purchased a pickup truck with 68,900 miles on the odometer.  One of the truck’s wheels fell off while his son was driving. A small business owner in Wyoming purchased a pickup truck with 101,000 miles showing on the odometer. After paying $10,000 for the truck and another $3,000 for repairs, the truck still needed a lot of work. He was stuck trying to operate his business with an unreliable vehicle and no cash for a replacement.

Were these people merely unfortunate, or were they victims of crime?  The truck the Seattle man purchased actually had more than 190,000 miles on it. An odometer rollback specialist, or “clocker,” had turned back the odometer over 100,000 miles to inflate the truck’s value.  The truck in Wyoming had over 204,000 miles, but had fallen into the hands of a clocker who rolled back the odometer and cheated the buyer.

Each year Americans buy and sell around 40 million used vehicles with a total value in the hundreds of billions of dollars.

The Civil Division’s Consumer Protection Branch brings both civil and criminal charges against wrongdoers, prosecuting a wide variety of frauds ranging from fraudulent business opportunities to mortgage frauds to these types of criminal car fraud schemes.

This multi-state odometer fraud activity makes it difficult or impossible for most local law enforcement agencies to investigate effectively. That’s why most cases are state-federal joint efforts, pairing local and state law enforcement agents with criminal investigators from the Office of Odometer Fraud Investigation of the National Highway Traffic Safety Administration in an effort to gather evidence from multiple jurisdictions.

Two common types of odometer tampering schemes are (1) Large-scale rings buy huge numbers of vehicles at wholesale, roll back the odometers, wash the titles and resell the vehicles wholesale. These cars can end up anywhere, including a used car lot of a local new car dealer; and (2) People who pretend to be selling personal vehicles through classified ads or Internet advertisements sites might tell you it’s their car, or a relative’s that they are selling. In fact, the car may be something they bought at auction or from some other commercial source and have rolled back the odometer.

Be wary of any personal sale involving someone other than the owner named on the title. Run as fast as you can from any sale where the seller won’t show you the title, where the title has any indication of alteration of names or numbers, or where the title is newly issued, especially if it is an out-of-state title.

Wherever you buy a used car, have a trusted mechanic check it out to see if the odometer reading is consistent with what the mechanic sees under the hood and in the dash. Ask the mechanic to check the dash for loose, removed or blown out light bulbs. Odometer tampering can set off warning lights and correct manufacturer codes are required to reset them. Also, ask the shop to check for any signs of a rebuilt wreck or water damage.

Here are some additional tips to guard against odometer tampering:

 1.Look for loose screws or scratch marks around the dashboard. This may signal that a mechanical odometer which has been manipulated with tools.

 2.Also on mechanical odometers, check to make sure that the digits in the odometer are lined up straight — particularly the 10,000 digit.
 3.Test drive the car and see if the speedometer sticks.
 4.Check for service stickers inside the door or under the hood that may give the actual mileage. The bad guys try to find these as well, but sometimes miss one.
 5.Look in the owner’s manual to see if maintenance was listed or if pages that might have shown high mileage were removed.
 6.Ask the dealer whether a computer warranty check has been run on the car.
 7.Use a commercially-available computer search program that checks for mileage alterations.  Some car dealers will give you one of these for free if you ask for it.
 8.Ask to see the title documents and look to see if the mileage reading on the documents has been altered.
 9.Look to see if the steering wheel was worn smooth.  Look for other signs of excessive wear on the arm-rest, the floor mats, the pedals for the brakes and gas, and the area around the ignition. If these items were recently replaced, that could also indicate efforts to hide the car’s true use and mileage.
10.Don’t assume that mileage is accurate just because the vehicle has an electronic odometer.

Most important, and worth repeating: have a mechanic you trust check out the car.

Special agents and officers seize more than $4.8 million in fake NFL merchandise and seize 307 websites during 'Operation Fake Sweep'

INDIANAPOLIS — Speaking at a National Football League (NFL) news conference on Thursday, U.S. Immigration and Customs Enforcement (ICE) Director John Morton, U.S. Customs and Border Protection (CBP) Director of Field Operations in Chicago David Murphy and NFL Vice President for Legal Affairs Anastasia Danias announced the record-breaking results of a nationwide enforcement operation targeting stores, flea markets and street vendors selling counterfeit game-related sportswear throughout the country. Special agents and officers also targeted illegal counterfeit imports into the United States, and seized hundreds of websites engaged in counterfeiting and piracy online. The initiative, dubbed Operation Fake Sweep, commenced Oct. 1, 2011.

Fake jerseys, ball caps, t-shirts, jackets and other souvenirs are among the counterfeit merchandise and clothing confiscated by teams comprised of: ICE's Homeland Security Investigations (HSI), U.S. Customs and Border Protection (CBP), U.S. Postal Inspection Service (USPIS), Indianapolis Metropolitan Police Department and the Indiana State Police – all in partnership with the NFL.

'Hard goods' seizures

Special agents from HSI and officers with CBP operated in multiple teams with the NFL and various law enforcement agencies throughout the nation to identify illegal shipments imported into the U.S., as well as stores and vendors selling counterfeit trademarked items. With three days left before Super Bowl XLVI, these teams have already seized 42,692 items of phony Super Bowl-related memorabilia along with other counterfeit items to date for a total take of more than $4.8 million – up from $3.72 million last year.

During this operation, an additional 22,570 items of counterfeit merchandise and clothing representing other sports leagues, including Major League Baseball, National Basketball Association and National Hockey League were seized by law enforcement. In total, this operation netted 65,262 counterfeit items worth $6.4 million.

"While most people are focusing on whether the Patriots or Giants will win on Sunday, we at ICE have our sights on a different type of victory: defeating the international counterfeiting rings that illegally profit off of this event, the NFL, its players and sports fans," said ICE Director Morton. "In sports, players must abide by rules of the game, and in life, individuals must follow the laws of the land. Our message is simple: abiding by intellectual property rights laws is not optional; it's the law."

"The NFL is committed to protecting fans and local businesses from being victimized by counterfeiters who are looking to profit illegally off of the public's enthusiasm for the NFL," said NFL Vice President Danias. "We are grateful for Homeland Security Investigations' tireless efforts in combating intellectual property theft and are pleased to be working along with them and the Indianapolis Metropolitan Police Department on this important issue."

Website seizures

Furthering HSI efforts to combat counterfeiting and piracy online, special agents seized a total of 307 websites. Sixteen of the sites illegally streamed live sporting telecasts over the Internet, including NFL games. Two hundred ninety-one website domain names were illegally selling and distributing counterfeit merchandise.

Additionally, Yonjo Quiroa, 28, of Comstock Park, Mich., was arrested Wednesday by special agents with HSI. He is charged with one count of criminal infringement of a copyright related to his operation of websites that illegally streamed live sporting event telecasts and pay-per-view events over the Internet. Quiroa operated nine of the 16 streaming websites that were seized, and he operated them from his home in Michigan until yesterday's arrest.

The website seizures during Operation Fake Sweep represent the 10th phase of Operation In Our Sites, a sustained law enforcement initiative targeting counterfeiting and piracy on the Internet. The 307 websites are in the process of being seized by law enforcement, and will soon be in the custody of the federal government. Visitors to these websites will then find a seizure banner that notifies them that the domain name has been seized by federal authorities and educates them that willful copyright infringement is a federal crime.

American business is threatened by those who pirate copyrighted material and produce counterfeit trademarked goods. Criminals are attempting to steal American ideas and products and sell them over the Internet, in flea markets, in legitimate retail outlets and elsewhere. Intellectual property (IP) thieves undermine the U.S. economy and jeopardize public safety. American jobs are being lost, American innovation is being diluted - and organized criminal enterprises are profiting from their increasing involvement in IP theft.

Since the launch of Operation In Our Sites in June 2010, the HSI-led National Intellectual Property Rights Coordination Center (IPR Center) has seized a total of 669 domain names.

Operation Fake Sweep continues

Operation Fake Sweep will continue this weekend at Super Bowl events and venues throughout the Indianapolis-area and around the nation.

HSI, CBP, USPIS and other law enforcement agencies partnered with the HSI-led IPR Center to combat intellectual property theft, including the illegal use of registered trademarks, trade names and copyrights of NFL Super Bowl XLVI merchandise. The IPR Center is one of the U.S. government's key weapons in the fight against criminal counterfeiting and piracy. The IPR Center uses the expertise of its 20 member agencies to share information, develop initiatives, coordinate enforcement actions and conduct investigations related to IP theft. Through this strategic interagency partnership, the IPR Center protects the public's health and safety, the U.S. economy and the war fighters.

The operation was spearheaded by the IPR Center in coordination with the Department of Justice's Computer Crime & Intellectual Property Section (CCIPS) and seven U.S. Attorneys' Offices, including: District of Colorado, District of Maryland, District of Minnesota, Western District of Michigan, Southern District of New York, Southern District of Texas and Western District of Texas.

To report IP theft or to learn more about the IPR Center, visit IPRCenter.gov.