St. Thomas, USVI – Shahime Ludvig, Jr., 20, of St. Thomas was arrested today on a complaint charging him with possession with the intent to distribute cocaine, United States Attorney Gretchen C.F. Shappert, announced. Ludvig made his initial appearance before Magistrate Judge Ruth Miller and was detained pending further proceedings.

According to the complaint, Ludvig was attempting to smuggle twenty-three kilograms of cocaine through the Cyril E. King to Atlanta, Georgia on Delta Flight #307. U.S. Customs and Border Protection (CBP) Agents discovered that the suitcase Ludvig checked in for the flight contained white, brick-like objects that field-tested positive for cocaine and weighed approximately twenty-three kilograms.

If convicted of possession with the intent to distribute cocaine, Ludvig faces a term of imprisonment of not less than ten years and not more than life and a fine of $10,000,000.00.

This case is being investigated by Homeland Security Investigations (HSI) and U.S. Customs and Border Protection (CBP) and the U.S. Drug Enforcement Administration (DEA). It is being prosecuted by Assistant United States Attorney Sigrid M. Tejo-Sprotte.

St. Thomas, USVI – Ngoc Nguyen, 21, and Fendi Brooks, 25, both from Pittsburgh, Pennsylvania, were arrested today on a complaint charging them with conspiracy to possess with the intent to distribute thirteen kilograms of cocaine and possession with the intent to distribute cocaine, United States Attorney Gretchen C.F. Shappert, announced. Nguyen and Brooks made their initial appearance before Magistrate Judge Ruth Miller and were detained pending further proceedings.

According to the complaint, Nguyen and Brooks were stopped by U.S. Customs and Border Protection (CBP) Officers at the Cyril E. King Airport after they discovered that Nguyen and Brooks were attempting to smuggle thirteen kilograms of cocaine through the airport to the U.S. mainland in their checked luggage. The white powdery substance discovered in the suitcase, field-tested positive for cocaine and weighed approximately thirteen kilograms.

If convicted of conspiracy to possess with the intent to distribute and possession with the intent to distribute cocaine, Nguyen and Brooks each face a term of imprisonment of not less than ten years and not more than life and a fine of $10,000,000.00 on each count.

This case is being investigated by Homeland Security Investigations (HSI) and U.S. Customs and Border Protection (CBP) and the U.S. Drug Enforcement Administration (DEA). It is being prosecuted by Assistant United States Attorney Sigrid M. Tejo-Sprotte.

SPRINGFIELD, Mo. – A Joplin, Mo., woman was convicted by a federal trial jury today of illegally possessing a firearm.

Tracy Arlene Smith, 47, was found guilty of one count of being a felon and an unlawful user of cocaine and methamphetamine in possession of a firearm and ammunition.

According to evidence introduced during the trial, law enforcement officers executed a search warrant at Smith’s residence located in Joplin, on June 22, 2017.  During the execution of the search warrant, members of the Ozark Drug Enforcement Team seized Smith’s purse, which contained a CDM Prod. Inc., .22-caliber pistol, loaded with six rounds of .22 caliber ammunition. Officers also seized drug paraphernalia.

Under federal law, it is illegal for anyone who is an unlawful user of controlled substances, or who has been convicted of a felony, to be in possession of any firearm or ammunition. Smith, who was on parole at the time she committed the offense, has five prior felony convictions for forgery, four prior felony convictions for possession of a controlled substance, and prior felony convictions for sale of a controlled substance (on three separate occasions) and assault.

Under federal statutes, Smith is subject to a mandatory minimum sentence of 15 years in federal prison without parole, up to a sentence of life in federal prison without parole. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory sentencing guidelines and other statutory factors. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.

Following the presentation of evidence, the jury in the U.S. District Court in Springfield, Mo., deliberated for approximately 30 minutes before returning the guilty verdict to U.S. District Judge M. Douglas Harpool, ending a trial that began Monday, Sept. 24, 2018.

This case is being prosecuted by Supervisory Assistant U.S. Attorney Randall D. Eggert and Assistant U.S. Attorney Nhan D. Nguyen. It was investigated by the Ozark Drug Enforcement Team and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
 

United States Attorney Richard W. Moore of the Southern District of Alabama announced that Charles Raymond Stagner, 36, of Saraland, Alabama, was sentenced in federal court on his conviction on two counts of possession with intent to distribute methamphetamine.  Stagner was convicted by a jury following a trial in June of 2018.  Evidence from the trial showed that Stagner sold methamphetamine to a confidential informant working with the Saraland Police Department, and when officers obtained a search warrant for his residence, they found additional quantities of methamphetamine, scales and other drug paraphernalia.  Court documents reflect that Stagner’s prior federal conviction for conspiracy to manufacture methamphetamine occurred in 2009.   

United States District Court Judge William H. Steele imposed a sentence of 132 months imprisonment on each count, with the sentences to run concurrently.  When Stagner is released from prison, he will serve eight years of supervised release.  As conditions of his supervised release, the judge ordered that Stagner would receive drug and alcohol treatment as well as mental health counseling.   No fine was imposed but Stagner was ordered to pay $200 in special mandatory assessments.   

The case was investigated by the Saraland Police Department, the Mobile County Sheriff’s Office and the Department of Homeland Security, Homeland Security Investigations.  It was prosecuted in the United States Attorney’s Office by AUSA Gloria A. Bedwell.

PROVIDENCE, R.I. – A New Jersey man previously convicted in federal court in Massachusetts and incarcerated for masterminding a real estate fraud scheme, pleaded guilty in federal court in Providence on Friday to charges that he again conspired to defraud financially distressed homeowners, investors, and financial institutions of fees, rental income, mortgage payment funds, property ownership and/or proceeds from the sale of their properties. 

Hasan Hussain, 57, of Princeton, N.J. also pled guilty to aggravated identity theft in connection with the scheme. 

Hussain’s guilty plea before U.S. District Court Judge John J. McConnell, Jr., is announced by United States Attorney Stephen G. Dambruch; Christina D. Scaringi, Special Agent in Charge of the Northeast Region of the U.S. Department of Housing and Urban Development Office of Inspector General; Brian Deck, Resident Agent in Charge of the Providence Office of the U.S. Secret Service; Harold H. Shaw, Special Agent in Charge of the Boston Division of the FBI; and Colonel Ann C. Assumpico, Superintendent of the Rhode Island State Police.

At the time of his guilty plea to the most recent federal indictment, Hussain admitted to using various business entities to trick distressed property owners, who were seeking loan modifications, into paying him fees, moving out of their homes, and selling their homes in short sale transactions.  As part of the plea, Hussain further admitted that he convinced lenders to agree to artificially low sale prices for the distressed property owners’ homes by directing other individuals to damage the properties prior to the short sales. Thereby, Hussain, or individuals or businesses associated with him, acquired the properties at reduced prices, and then flipped them to investors at much higher prices.  During his change of plea, Hussain admitted that these investors were defrauded of their funds, or good credit, or both when they agreed to purchase properties from Hussain. 

Hussain further admitted that he assisted investors to acquire federally backed mortgages through fraudulent applications, ultimately resulting in losses to the lenders or the Federal Housing Administration.  Some of the tactics employed by Hussain as part of the scheme included misuse of identities and cutting and pasting signatures on property deeds and financial documents.

As part of his plea agreement, Hussain admitted that his scheme resulted in losses between $550,000 and $1.5 million dollars; that ten or more victims were harmed; and that at least some of his victims were particularly vulnerable, as a result of their personal situation.  The plea agreement also provided that the government would seek a leadership enhancement for Hussain given the extensive nature of the scheme and his role in it.

At sentencing on January 8, 2018, Hussain faces up to 32 years in federal prison, 5 years of supervised release, and a fine of $1,250,000.

A co-defendant in this matter, Ricardo Abreu, who pled guilty earlier this year is scheduled to be sentenced on October 30, 2018.

The case is being prosecuted by Assistant U.S. Attorneys Sandra R. Hebert and Richard B. Myrus.

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The U.S. Department of Justice’s Office of Violence against Women has awarded a three- year $600,000 grant to provide legal assistance to victims of domestic violence and sexual assault in Skagit County, Washington announced U.S. Attorney Annette L. Hayes.  The grant was awarded to the Northwest Justice Project, headquartered in Seattle, in partnership with Skagit Domestic Violence and Sexual Assault Services.

“These funds will support victims of crime and enhance the ability of local organizations to reach out to victims who may be isolated geographically or have limited English-speaking skills,” said U.S. Attorney Annette L. Hayes. “The work supported by thee grants is important to ensuring justice reaches everyone in our Western Washington communities.”

According to the grant award, the funding will increase civil and criminal legal assistance programs for victims of domestic violence, dating violence, sexual assault and stalking.  The funds provide legal services, at minimal or no cost, to victims who are seeking relief through the courts arising out of domestic abuse or violence. Some of the services include assisting with protection orders and victim impact statements; attending court in support of victims; and providing culturally relevant education programs about domestic abuse and sexual violence to immigrant, Native American and limited English-speaking populations.

For more information on this grant, please contact the Northwest Justice Project or DOJ’s Office on Violence Against Women.

WASHINGTON – The former chief financial officer of Bankrate Inc., a publicly traded financial services and marketing company formerly headquartered in North Palm Beach, Florida, was sentenced today to 10 years in prison for orchestrating an accounting and securities fraud scheme that caused more than $25 million in shareholder losses.

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Ariana Fajardo Orshan of the Southern District of Florida and Inspector in Charge Delany DeLeon-Colon of the U.S. Postal Inspection Service’s Criminal Investigations Group made the announcement.

Edward J. DiMaria, 53, of Fairfield County, Connecticut, was sentenced by Chief U.S. District Judge K. Michael Moore of the Southern District of Florida, who also imposed three years of supervised release and ordered DiMaria to pay restitution in the amount of $21,234,214.  On June 28, DiMaria pleaded guilty to one count of conspiracy to making false statements to a public company’s accountants, falsifying a public company’s books, records and accounts, and securities fraud; and one count of making materially false statements to the Securities and Exchange Commission (SEC).  

“While serving as Bankrate’s CFO, Edward DiMaria blatantly manipulated the company’s publicly reported financial statements by repeatedly lying and directing others to lie to auditors, regulators, and shareholders,” said Assistant Attorney General Benczkowski.  “The significant sentence handed down today underscores the serious nature of corporate fraud and the damage it causes to shareholders and to the public’s trust in our financial markets.  The sentence also demonstrates the Department’s commitment to prosecuting corporate misconduct to the fullest extent of the law.”

“The U.S. Postal Inspection Service has an extensive history of investigating complex financial fraud schemes in order to protect investors as well as the integrity of the financial marketplace from fraudulent activities by trusted insiders who abuse their positions,” said Inspector in Charge Delany DeLeon-Colon. “Anyone who engages in this type of financial fraud scheme should know they will be found and they will be held accountable.”

As part of his guilty plea, DiMaria admitted that between 2010 and 2014 he directed and conspired to commit a complex scheme to artificially inflate Bankrate’s earnings through so-called “cookie jar” or “cushion” accounting, whereby millions of dollars in unsupported expense accruals were purposefully left on Bankrate’s books and then selectively reversed in later quarters to boost earnings.  In addition, DiMaria admitted that he conspired with other Bankrate employees to misrepresent certain company expenses as “deal costs” in order to artificially inflate publicly reported adjusted earnings metrics.  DiMaria made materially false statements to Bankrate’s independent auditors to conceal the improper accounting entries, and he caused Bankrate’s financial statements filed with the SEC to be materially misstated, he admitted.

Hyunjin Lerner, Bankrate’s former vice president of finance, previously pleaded guilty for his role in the conspiracy.  Lerner was sentenced by Judge Moore earlier this year to serve 60 months in prison. 

The U.S. Postal Inspection Service’s National Headquarters Fraud Team investigated the case.  Assistant Chief Henry Van Dyck and Trial Attorneys Emily Scruggs and Jason Covert of the Criminal Division’s Fraud Section are prosecuting the case, with assistance from the U.S Attorney’s Office for the Southern District of Florida.  The SEC also provided assistance in this matter.

Potential victims of the scheme can find information about their rights under relevant law at the following website: www.justice.gov/criminal-vns/case/edward-j-dimaria.

Bangor, Maine:  United States Attorney Halsey B. Frank announced that Todd Shorey, 54 of Newport, Maine, was sentenced today in U.S. District Court by Senior Judge John A. Woodcock, Jr. to 84 months in prison and five years of supervised release for conspiring to distribute over a kilogram of heroin.  He was also fined $5,000. Shorey pleaded guilty on April 24, 2017.

According to court records, between May 2015 and January 2016, Shorey conspired with Jamie Akerson and others to obtain large quantities of heroin on a weekly basis from an out-of-state supplier and to have it distributed by others throughout Central Maine. 

In imposing the sentence, Judge Woodcock described Shorey as a “traitor” to his community.

The case was investigated by the U.S. Drug Enforcement Administration, the Maine Drug Enforcement Agency, and the Kennebec County Sheriff’s Department, with assistance provided by the Augusta Police Department, and prosecuted as part of the Department of Justice’s Strategy to Combat the Opioid Epidemic.

             On September 20, 2018, Palm Beach County resident Charles Edward Smith, 63, was sentenced to 235 months in prison by United States District Judge Donald M. Middlebrooks following his jury trial conviction for participating in a conspiracy to commit sex trafficking of a minor (Case No. 18-CR-80062).  Co-defendant Michael Joseph Clark, 44, was sentenced to 220 months in prison by Judge Middlebrooks, after he previously pled guilty to participating in the conspiracy and committing substantive sex trafficking of a minor offenses.

            Ariana Fajardo Orshan, United States Attorney for the Southern District of Florida, Robert F. Lasky, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, and Sarah J. Mooney, Chief of Police, West Palm Beach Police Department (WPBPD) made the announcement. 

            On or about March 13, 2018, members of the WPBPD discovered a 14-year old minor, identified as a missing person, in a West Palm Beach residence controlled by Smith.  The defendant and other co-conspirators, including Michael Joseph Clark, operated a prostitution operation out of the residence.  Smith had the minor work as a prostitute, setting up her sexual encounters, giving her drugs and requiring her to use her prostitution earnings to stay at the house. 

            This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.

             Mrs. Fajardo Orshan commended the investigative efforts of the FBI and the WPBPD in this matter.  The case was prosecuted by Assistant U.S. Attorneys Lothrop Morris and Ellen Cohen.

Related court documents and information can be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or at http://pacer.flsd.uscourts.gov.

Bangor, Maine:  United States Attorney Halsey B. Frank announced that Christopher A. Hutchinson, 30, of Cushing, Maine pleaded guilty today in U.S. District Court to two counts of Seaman’s Manslaughter for causing two deaths at sea. 

According to court records, on November 1, 2014, after smoking marijuana and drinking, Hutchinson took his lobster boat, No Limits, out into a predicted storm with two crewmen aboard.  After he had ingested oxycodone, the boat capsized.  The two crewmen were not wearing personal floatation devices or survival suits.  The No Limits’ Emergency Position Indicating Radio Beacon alerted at about 1:20 p.m.  The Coast Guard rescued Hutchinson at about 4 p.m.  At the time, he was wearing shorts and a t-shirt.  The Coast Guard located the bow of No Limits at about 5 p.m.  The bodies of the crewmen have never been recovered.

The defendant faces up to 10 years in prison, three years of supervised release, and a $250,000 fine on each count.  He will be sentenced after the completion of a presentence investigation report by the U.S. Probation Office. A plea agreement provides that a sentence of four years in prison and three years of supervised release is appropriate and that the defendant may withdraw his guilty plea if the court rejects that sentence. 

The investigation was conducted by the U.S. Coast Guard.

CHICAGO — A Chinese national was arrested in Chicago today for allegedly acting within the United States as an illegal agent of the People’s Republic of China.

JI CHAOQUN, 27, a Chinese citizen residing in Chicago, worked at the direction of a high-level intelligence officer in the Jiangsu Province Ministry of State Security, a provincial department of the Ministry of State Security for the People’s Republic of China, according to a criminal complaint and affidavit filed in U.S. District Court in Chicago.  Ji was tasked with providing the intelligence officer with biographical information on eight individuals for possible recruitment by the JSSD, the complaint states.  The individuals included Chinese nationals who were working as engineers and scientists in the United States, some of whom were U.S. defense contractors, according to the complaint.

The complaint charges Ji with one count of knowingly acting in the United States as an agent of a foreign government without prior notification to the Attorney General.  He will make an initial court appearance today at 4:00 p.m. CDT before U.S. Magistrate Judge Michael T. Mason in Courtroom 2266 of the Everett M. Dirksen U.S. Courthouse in Chicago.

The arrest and complaint were announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; John C. Demers, Assistant Attorney General for National Security at the U.S. Department of Justice; and Jeffrey S. Sallet, Special Agent-in-Charge of the Chicago office of the Federal Bureau of Investigation.  The U.S. Army 902nd Military Intelligence Group provided valuable assistance.  The government is represented by Assistant U.S. Attorney Shoba Pillay of the Northern District of Illinois, and Senior Trial Attorney Heather Schmidt of the National Security Division’s Counterintelligence and Export Control Section.

According to the complaint, Ji was born in China and arrived in the United States in 2013 on an F1 Visa, for the purpose of studying electrical engineering at the Illinois Institute of Technology in Chicago.  In 2016, Ji enlisted in the U.S. Army Reserves as an E4 Specialist under the Military Accessions Vital to the National Interest program, which authorizes the U.S. Armed Forces to recruit certain legal aliens whose skills are considered vital to the national interest.  In his application to participate in the MAVNI program, Ji specifically denied having had contact with a foreign government within the past seven years, the complaint states.  In a subsequent interview with a U.S. Army officer, Ji again failed to disclose his relationship and contacts with the intelligence officer, the charge alleges.

The public is reminded that a complaint is not evidence of guilt.  The defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.  The charge in the complaint is punishable by a maximum sentence of ten years in prison.  The statutory maximum penalty is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.

SACRAMENTO, Calif. —Joseph Woloszyn, 32, of Sacramento, pleaded guilty today to one count of obstruction of justice and four counts of perjury, U.S. Attorney McGregor W. Scott announced.

According to court documents, on June 28, 2017, Woloszyn provided false testimony under oath at an evidentiary hearing in the case of United States v. M.W., 2:13-cr-067-KJM. Woloszyn testified on behalf of the defendant and provided false statements related to his gang tattoos, nickname, phone number, and contacts with the defendant. Prior to his testimony, during a recorded jail call, Woloszyn told the defendant “When they come to me, good luck.” Woloszyn further assured the defendant, “I’m going to stay solid all the way through, regardless.”

This case is the product of an investigation by the Federal Bureau of Investigation. Assistant U.S. Attorney Cameron L. Desmond is prosecuting the case.

Woloszyn is scheduled to be sentenced by U.S. District Judge John A. Mendez on January 15, 2019. Woloszyn faces a maximum statutory penalty of 10 years in prison and a $250,000 fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.

John H. Durham, United States Attorney for the District of Connecticut, announced that WILLIAM GAUVIN, 43, of Andover, Massachusetts, waived his right to be indicted and pleaded guilty today before U.S. District Judge Michael P. Shea in Hartford to one count of receipt of child pornography.

According to court documents and statements made in court, between approximately October 2016 and March 2017, GAUVIN, using the name “Will Wiggins,” solicited a 17-year-old boy in Connecticut to engage in sexually explicit conduct over Skype.  In exchange for the minor victim transmitting visual depictions of sexually explicit conduct to GAUVIN, GAUVIN paid the minor victim more than $3,000 using PayPal.  GAUVIN also asked the minor victim to persuade his brother, who was 15, to engage in sexually explicit conduct in exchange for money.

GAUVIN resided in Worcester, Massachusetts, at the time of the criminal conduct.

Judge Shea scheduled sentencing for December 20, 2018, at which time GAUVIN faces a mandatory minimum term of imprisonment of five years and a maximum term of imprisonment of 20 years.

GAUVIN was arrested on a federal criminal complaint on November 1, 2017.  He is released on a $100,000 bond pending sentencing.

This matter has been investigated by Homeland Security Investigations and the Connecticut State Police, with the assistance of the Worcester Police Department.  The case is being prosecuted by Assistant U.S. Attorney Nancy V. Gifford.

This prosecution is part of the U.S. Department of Justice’s Project Safe Childhood Initiative, which is aimed at protecting children from sexual abuse and exploitation.  For more information about Project Safe Childhood, please visit www.justice.gov/psc.

To report cases of child exploitation, please visit www.cybertipline.com.

John H. Durham, United States Attorney for the District of Connecticut, announced that EDWARD J. KOSINSKI, MD, 70, of Weston, was sentenced today by U.S. District Judge Vanessa L. Bryant in Hartford to six months of imprisonment, two years of supervised release and a $500,000 fine for insider trading.

On November 28, 2017, a jury found KOSINSKI guilty of two counts of securities fraud-insider trading.  According to the evidence presented during the trial, on January 29, 2014, KOSINSKI, a cardiologist, entered into a Clinical Study and Research Agreement with an authorized agent of Regado Biosciences, Inc., formerly a Delaware corporation whose common stock traded on the NASDAQ under the ticker symbol “RGDO.”  KOSINSKI, as a principal investigator for Regado’s clinical trial, was required to maintain in strict confidence all confidential information he received from Regado or its agent during the course of the clinical trial.  In May 2014, KOSINSKI owned 40,000 shares of Regado common stock.

On June 29, 2014, KOSINSKI and other principal investigators received an email from the clinical trial team stating that there had been several allergic reactions during the clinical trial, the acceptance of new subjects was put on hold and the Data and Safety Monitoring Board (“DSMB”) would be reviewing the recent events.  On June 30, 2014, while in possession of this non-public information, KOSINSKI sold his 40,000 shares of Regado common stock for between $6.59 and $7.00 per share.  On July 2, 2014, after the close of the market, Regado publicly announced that the DSMB initiated an unplanned review of the clinical trial and patient enrollment had been suspended until the DSMB completed its review.  On July 3, 2014, the stock fell $3.95 from the day’s previous closing price, to close at $2.81.

By selling his shares of Regado stock KOSINSKI avoided a loss of approximately $160,000.

On July 29, 2014, KOSINSKI and other principal investigators received an email from the clinical trial team stating that a death occurred in the clinical trial and that the trial was on hold.  On July 31, 2014, while in possession of this material, non-public information, KOSINSKI purchased 50 Regado common stock put option contracts with a strike price of $2.50.  On August 25, 2014, before the market opened, Regado publicly announced that it permanently halted the clinical trial and the price of Regado common stock fell approximately 60 percent.  KOSINSKI then purchased 5,000 shares of Regado common stock for approximately $1.13 per share and exercised his put options, netting more than $3,000.

KOSINSKI, who is released on a $500,000 bond, was ordered to report to prison on January 4, 2019.

This matter was investigated by the Federal Bureau of Investigation was prosecuted by Assistant U.S. Attorneys Heather Cherry and Jonathan Francis.

In a related federal civil matter, KOSINSKY has been charged by the Securities and Exchange Commission.  (Securities and Exchange Commission v. Edward J. Kosinski 3:16-cv-01322)

CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051

BUFFALO, N.Y. - U.S. Attorney James P. Kennedy, Jr. announced today that Pablo Lugo III, 27, of Lockport, NY, pleaded guilty before U.S. District Judge Elizabeth A. Wolford to possession with intent to distribute, and distribution, of fentanyl. The charge carries a maximum penalty of 20 years in prison and $1,000,000 fine. 

Assistant U.S. Attorney Meghan A. Tokash, who is handling the case, stated that on March 29, 2015, Lockport Police Officers responded to 152 Caledonia Street and found an individual, K.R., deceased. Officers recovered four reddish paper wrappers in the bathroom, one of which was tested at the Niagara County Sheriff’s Office Forensic Laboratory and determined to contain fentanyl. An autopsy determined that K.R. died of acute fentanyl intoxication.

Text messages recovered from K.R.’s cellular phone revealed that on March 28, 2015, K.R. communicated with Lugo between 12:22 p.m. and 12:51 p.m. K.R. died shortly after the text message exchange. The defendant admits that K.R.’s death resulted from the drugs he gave to K.R.

The plea is the result of an investigation by the Drug Enforcement Administration, under the direction of Special Agent-in-Charge James J. Hunt, New York Field Division; the Niagara County Drug Enforcement Task Force, under the direction of Sheriff James Voutour; and the Lockport Police Department, under the direction of Acting Chief Steven Preisch.

Sentencing is scheduled for December 20, 2018, at 3:00 p.m. before Judge Wolford.

# # # #

Aaron Rochester, 44, from Sioux City, Iowa, has been charged with one count of unlawful storage of hazardous waste and one charge of transportation of hazardous waste.­  The charges are contained in an Indictment filed on July 25, 2018, in United States District Court in Sioux City. 

­The Indictment alleges that, beginning on or about June 2015 through about July 2018, Rochester, as owner and operator of Recycletronics, knowingly and unlawfully, stored and transported hazardous waste, namely CRTs (cathode ray tubes) and leaded glass from televisions and computers at various facilities in and around Sioux City Iowa. 

If convicted, Rochester faces a possible maximum sentence of five years’ imprisonment, a maximum fine of up to $50,000 for each day of the violation, and three years of supervised release following any imprisonment.­

Rochester appeared today, September 25, 2018, in federal court in Sioux City and was released on bond with terms of supervision with US Probation.    Rochester’s next appearance for trial is scheduled for November 5, 2018.  As with any criminal case, a charge is merely an accusation and a defendant is presumed innocent until and unless proven guilty.

The case is being prosecuted by Assistant United States Attorney Shawn S. Wehde and was investigated by the United States Environmental Protection Agency (EPA).  EPA Special Agent in Charge Jeffrey Martinez stated, “EPA’s Criminal Investigation Division will continue to serve our communities by aggressively investigating and seeking prosecution of those whose conduct violates laws governing the storage of hazardous waste.”

Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. 

The case file number is 18-4073.  Follow us on Twitter @USAO_NDIA.

SIOUX FALLS – United States Attorney Ron Parsons joined the Department of Justice in announcing more than $113 million in grant awards to improve public safety, serve victims of crime, combat violence against women, and support youth programs in American Indian and Alaska Native communities.  Included in that amount for the District of South Dakota was $414,626 for the Rosebud Sioux Tribe, and $339,925 for the Sisseton Wahpeton Tribe.

“I am grateful for this substantial investment in local public safety by the Department of Justice,” said U.S. Attorney Parsons.  “Through our partnerships with Tribal governments, we are committed not only to prosecuting violent crime and domestic abuse offenders in Native American communities, but to aiding victims with the resources needed to recover, persist, and overcome.”

Nationwide, grants were awarded to 133 American Indian tribes, Alaska Native villages, and other tribal designees through the Coordinated Tribal Assistance Solicitation, a streamlined application for tribal-specific grant programs.  Of the $113 million, just over $53 million comes from the Office of Justice Programs, more than $35 million from the Office on Violence Against Women, and more than $24.7 million from the Office of Community Oriented Policing Services.

In addition, the Department is in the process of allocating up to $133 million in a first-ever set aside program to serve victims of crime in American Indian and Alaska Native communities.  The awards are intended to help tribes develop, expand, and improve services to victims of crime by providing funding, programming and technical assistance.  Recipients will be announced in the near future. 

“With these awards, we are doubling the amount of grant funding devoted to public safety programs and serving victims of crime in Native American communities,” said Principal Deputy Associate Attorney General Jesse Panuccio, who made the announcement during his remarks at the 26th Annual Four Corners Indian Country Conference in Santa Fe, New Mexico.  “There is an unacceptable level of violent crime and domestic abuse in American Indian and Alaska Native communities.  This increase in resources, together with our aggressive investigation and prosecution of crimes, shows how seriously Attorney General Sessions and the entire Department of Justice take these issues.  We are committed to reducing violent crime and improving public safety.”

The Four Corners Conference is facilitated annually by U.S. Attorneys from Arizona, Colorado, New Mexico and Utah to provide a forum for discussion of justice-related topics with a large number of populous and diverse tribal nations located in the region.

CTAS awards cover nine purpose areas: public safety and community policing; justice systems planning; alcohol and substance abuse; corrections and correctional alternatives; children’s justice act partnerships; services for victims of crime; violence against women; juvenile justice; and tribal youth programs.  CTAS funding helps tribes develop and strengthen their justice systems’ response to crime, while expanding services to meet their communities’ public safety needs.

This announcement is part of the Justice Department’s ongoing initiative to increase engagement, coordination and action on public safety in American Indian and Alaska Native communities.

A listing of the CTAS awards is available at www.justice.gov/tribal/page/file/1095161/download.

PHILADELPHIA, PA – United States Attorney William M. McSwain today announced a $55 million civil settlement with Community Health Systems, Inc. (CHS) to resolve civil allegations relating to two hospitals operated by Health Management Associates (HMA), in Lancaster, Pennsylvania.  The resolution of these claims in the Eastern District is part of a larger $260 million settlement between the Department of Justice and CHS which arose out of HMA’s fraudulent billing practices in multiple healthcare institutions across the United States.

            Between 2009 and 2012, two former HMA hospitals, Lancaster Regional Medical Center and Heart of Lancaster Medical Center in Pennsylvania, billed federal health care programs for services referred to the hospitals by individual physicians and physician groups.  According to the government, HMA compensated these physicians and physician groups through complex kickback arrangements in exchange for a patient referral stream. In one instance, HMA bought two businesses from a physician group for grossly inflated amounts.  HMA also paid that same physician group under a contract that was styled as payment for services that were never performed or that neither party ever had any intention of performing. In another instance, HMA paid a local surgeon exorbitantly more than the fair market value of his services.  According to the government, these arrangements were intentionally structured to disguise payments which were, in actuality, payments for patient referrals, not for legitimate services. 

“Our resolution of this matter and the significant recovery we have obtained show once again that no matter how complex the fraud scheme is, we will find it, stop it, and punish it,” said U.S. Attorney McSwain.  “HMA covered up kickbacks for patient referrals with a host of sham joint venture agreements, lease payments, and management agreements.  These sorts of improper physician inducements are a form of ‘pay to play’ business practices that will not be tolerated.  Healthcare institutions cannot pad their bottom line at the expense of the American taxpayers.  And most importantly, this conduct must be rooted out because it gets in the way of providing top-notch patient care to American citizens.”

The allegations resolved by the settlement were brought in eight lawsuits filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private parties to sue on behalf of the government for false claims and to receive a share of any recovery.  The eight qui tam cases, which were filed in various districts including the Eastern District of Pennsylvania, were transferred to the U.S. District Court for the District of Columbia as part of a multi-district litigation presided over by the Honorable Reggie B. Walton. 

George E. Miller and Michael J. Metts, former HMA hospital executives in Lancaster, filed suit in the Eastern District of Pennsylvania, alleging the improper financial relationships between HMA and the physicians groups.  Mr. Miller and Mr. Metts will receive approximately $12.4 million as their share of the recovery from HMA in that case.  “We sincerely thank Mr. Miller and Mr. Metts.  Together with their lawyers, these two citizens provided essential assistance to the government throughout this case.  Without the willingness of relators to shed light on allegations of fraud, preserving government program funds would be far more challenging.  Their efforts played a vital role in the resolution of these cases,” said U.S. Attorney McSwain. 

            “Compliance with government healthcare rules requires that patients only receive treatment they actually need.  Then government programs should be billed just for those services.  No more, no less,” said Derrick L. Jackson, Acting Assistant Inspector General for Investigations at the U.S. Department of Health and Human Services.  “Let there be no doubt—we will continue to protect federal healthcare programs and beneficiaries by holding provider organizations fully accountable.”    

This case was investigated by the U.S. Department of Health and Human Services Office of the Inspector General and U.S. Office of Personnel Management Office of the Inspector General.  For the U.S. Attorney’s Office, the investigation and settlement were handled by Assistant U.S. Attorneys Charlene Keller Fullmer and Veronica Finkelstein.

            The civil claims resolved by the settlement are allegations against HMA only, and there has been no determination of liability.

CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051

ROCHESTER, N.Y. - U.S. Attorney James P. Kennedy, Jr. announced today that Andrew Culliton, 38, of West Seneca, NY, who was convicted of conspiracy to possess with intent to distribute, and to distribute, methamphetamine, was sentenced to 36 months in prison by U.S. District Judge David G. Larimer.

Assistant U.S. Attorney Katelyn Hartford, who handled the case, stated that Culliton, along with others, conspired to distribute methamphetamine at “The Bone Yard,” an auto salvage yard in Dansville, NY.  On two occasions, March 2, 2017, and March 10, 2017, the defendant sold pure crystal methamphetamine to another individual known to law enforcement. 

Culliton is one of seven defendants charged and convicted in this case.

The sentencing is the result of an investigation by the Drug Enforcement Administration, under the direction of Special Agent-in-Charge James J. Hunt, New York Field Division; the Livingston County Sheriff’s Department, under the direction of Sheriff Thomas Dougherty; and the New York State Police, under the direction of Major Eric Laughton.  

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CHARLOTTE, N.C. – Three Gaston County drug trafficker were sentenced in federal court yesterday to prison terms ranging from nine to 17.5 years, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.  Quinton Lavar Brown, 34, of Gastonia, was sentenced to 210 months in prison and five years of supervised release; Antwan Lamar Floyd, 35, of Gastonia, was sentenced to 144 months in prison and five years of supervised release; and Maurice Terrell Robinson, 29, of Dallas, N.C. was sentenced to 110 months in prison, followed by 6 years of supervised release.  Chief U.S. District Judge Frank D. Whitney presided over the sentencing hearings.

John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, and Chief Robert C. Helton of the Gastonia Police Department join U.S. Attorney Murray in making today’s announcement.

According to court documents and information presented at the sentencing hearings, the three men were responsible for trafficking multiple kilograms of crack cocaine in and around Gaston County.  Court records show that, over the course of the investigation, law enforcement recovered from the defendants’ stash houses and residences more than $24,931 in cash, 74 grams of cocaine, 1.5 kilograms of marijuana, a money counter and four sets of digital scales.  In addition, law enforcement seized illegally possessed firearms, including one AK-47 assault rifle, one shotgun, four handguns, and ammunition. 

Brown, who engaged in drug trafficking while on supervised release for a previous federal drug and racketeering conspiracy conviction, pleaded guilty on May 2, 2018, to conspiracy to distribute and to possess with intent to distribute crack cocaine. Floyd pleaded guilty to conspiracy to distribute and to possess with intent to distribute crack cocaine on April 11, 2018. Robinson, who was also on supervised release in connection with a previous federal drug, racketeering conspiracy and Hobbs Act Robbery conviction, pleaded guilty to possession with intent to distribute crack cocaine on December 19, 2017. 

All three defendants are currently in federal custody and will be transferred to the custody of the Federal Bureau of Prisons upon designation of a federal facility.  Federal sentences are served without the possibility of parole.

            These convictions stem from an Organized Crime Drug Enforcement Task Force (OCDETF) investigation.  OCDETF is a joint federal, state and local cooperative approach to combat drug trafficking and is the nation’s primary tool for disrupting and dismantling major drug trafficking organizations, targeting national and regional drug trafficking organizations and coordinating the necessary law enforcement entities and resources to disrupt or dismantle the targeted criminal organization and seize their assets.

            These cases are also part of Project Safe Neighborhoods (PSN), a program that has been historically successful in bringing together all levels of law enforcement to reduce violent crime and make our neighborhoods safer for everyone. Attorney General Jeff Sessions has made turning the tide of rising violent crime in America a top priority. In October 2017, as part of a series of actions to address this crime trend, Attorney General Sessions announced the reinvigoration of PSN.

            In making today’s announcement U.S. Attorney Murray thanked the Federal Bureau of Investigation, Charlotte Division, and the Gastonia Police Department for their investigation of the case.

            Assistant U.S. Attorney Steven R. Kaufman of the U.S. Attorney’s Office in Charlotte was in charge of the prosecution.