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Two Pennsylvania physicians acquitted of drug charges

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WHEELING, WEST VIRGINIA – After an eight-day trial, Dr. Krishan Kumar Aggarwal, of Moon Township, Pennsylvania, and Dr. Cherian John, of Coraopolis, Pennsylvania, were found not guilty of drug charges, United States Attorney Bill Powell announced.

“The jury returned not guilty verdicts against Dr. Aggarwal and Dr. John.  Notwithstanding the verdict, we remain steadfast in our intention to prosecute matters which we believe, based upon the evidence, support prosecution.  Jury trials are an adversarial process and do not provide guaranteed results.  Though we disagree with the jury in this case, the jury has spoken and that is part of the process, which we have the utmost respect for.  Our team worked very hard and this verdict will not deter our efforts on the opioid front,” said Powell.

A federal jury deliberated for nearly eight hours before finding Aggarwal, age 75, and John, age 66, not guilty of one count of “Conspiracy to Distribute Controlled Substances Outside the Bounds of Professional Medical Practice,” and were also indicted on separate counts of “Aiding and Abetting Health Care Fraud,” and “Aiding and Abetting the Distribution of Controlled Substances Outside the Bounds of Professional Medical Practice.”  Aggarwal and John were accused of contracting with Redirections Treatment Advocates, LLC, in Weirton, West Virginia, and writing illegitimate prescriptions for suboxone, some of which were paid for by Medicaid and Medicare. 

Assistant U.S. Attorneys Sarah E. Wagner and Andrew R. Cogar prosecuted the cases on behalf of the government. The Drug Enforcement Administration, the Federal Bureau of Investigation, and the Inspector General at the U.S Department of Health and Human Services investigated.

Senior U.S. District Judge Frederick P. Stamp, Jr. presided.


Media Advisory

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CEDAR RAPIDS, IA – On June 17, 2019, five men will be sentenced in federal district court in Cedar Rapids, Iowa, following their convictions for drug, robbery, and gun crimes related to the fatal shooting of an individual in Coggon, Iowa, in February 2017.  On June 18, 2019, at 11:00 a.m. the United States Attorney’s Office and the Linn County Sheriff’s Office will hold a press conference at the United States Attorney’s Office in the federal courthouse, 111 Seventh Avenue SE, in Cedar Rapids to announce the results of those sentencing hearings. 

Additionally, United States Attorney Peter E. Deegan, Jr. will announce recent Project Safe Neighborhood gun charges in Eastern Iowa at the press conference.  Representatives from federal and local law enforcement will be present.    

Event Details

When:        June 18, 2019

Where:       Cedar Rapids Federal Courthouse (United States Attorney’s Office), 111 Seventh Avenue SE

Time:          11:00 a.m.

A press release will be provided and interview opportunities will be available.

Please RSVP to Tony Morfitt at tony.morfitt@usdoj.gov if you plan to attend. 

Follow us on Twitter @USAO_NDIA.

Pickens County Sheriff to Plead Guilty to Wire Fraud and Tax Charges

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BIRMINGHAM – Today a federal indictment was unsealed against the longstanding sheriff of Pickens County for wire fraud and filing false tax returns, announced U.S. Attorney Jay E. Town, FBI Special Agent in Charge Johnnie Sharp, Jr. and IRS-Criminal Investigation Special Agent in Charge Thomas J. Holloman.  Also today, a plea agreement was filed in federal district court.  According to that agreement, the defendant has agreed to plead guilty to one count of wire fraud and one count of filing a false tax return.

The nine-count indictment filed in U.S. District Court charges Pickens County Sheriff DAVID EUGENE ABSTON, of Gordo, with seven counts of wire fraud and two counts of filing a false tax return. 

 

“A sitting county sheriff is alleged to have defrauded a food bank and a church for his personal gain at the expense of the underprivileged that the food bank serves,” Town said.  “Our office will continue to aggressively pursue and prosecute public officials who violate the public trust for their own personal gain.”

 

“No matter what your career or position is within our communities, all U.S. citizens are obligated to comply with the tax laws,” said Holloman. “Honest and law abiding citizens are fed up with the likes of those who use deceit and fraud to line their pockets as well as skirt their tax obligations.”

According to the indictment, as sheriff of Pickens County, Abston was responsible for the care and custody of prisoners housed in the Pickens County Jail.  That responsibility included feeding inmates housed in the jail.  In exchange, Abston was entitled to receive a specified food allowance per prisoner per day from the state of Alabama and other governmental entities.  Between 2014 and 2018, Abston received more than $400,000 in food allowance money from the state of Alabama and other governmental entities.  During that same period, Abston—like many sheriffs in Alabama—had a practice of keeping for himself any food allowance money that he did not spend to feed inmates.

During that same period Abston engaged in a scheme to defraud the West Alabama Food Bank, as well the Highland Baptist Church of Gordo, Alabama—where Abston was a member—in order to reduce his jail food expenses and increase the amount of food allowance money he could keep.

            The West Alabama Food Bank (WAFB) is a non-profit based in Tuscaloosa, Alabama, with the stated mission of helping to alleviate hunger and food insecurity in nine West Alabama counties.  WAFB collects donations of food and distributes that food to partner agencies such as churches, soup kitchens, and food pantries.  To become a partner agency with WAFB, a church must submit an application stating, among other things, that the church will distribute food in compliance with WAFB policy.  The criteria for a church’s partnering with WAFB include a requirement that the church use the food it receives solely to serve the ill, needy, or infants.  In turn, WAFB provides food to its partner agencies for a nominal fee to help cover the costs of food maintenance and storage.

According to the indictment, in 2014 Abston convinced Highland Baptist Church in Gordo, Alabama, to permit him to open a bank account to be used for a church food pantry with WAFB.  Abston opened that bank account, in the name of the Highland Baptist Church Food Pantry.  Abston was the sole signatory on the account.

Around the same time, Abston applied, on behalf of the Highland Baptist Church Food Pantry, to become a partner agency of WAFB.  The application to WAFB claimed that the “general program” of the church food pantry would be to help “feed poor” and “children from disadvantage[d] and poor neighborhoods.”  The application claimed that the food pantry would use unemployment, sickness, and poverty as eligibility guidelines for food.  The application said nothing about the food pantry’s providing any food to inmates in the Pickens County Jail.

Between 2014 and 2018, Abston wrote more than $80,000 in checks from his own bank account to the church food pantry bank account, and wrote more than $80,000 in checks from the food pantry bank account to WAFB in exchange for food.

According to the indictment, Abston used a significant portion of that food to feed inmates in the Pickens County Jail.

            The indictment also alleges that Abston filed false tax returns for the 2015 and 2016 tax years, because he failed to report all of his income for those years.

Each count of wire fraud carries a maximum penalty of 20 years and a fine of up to $250,000.  The maximum penalty for filing a false tax return is three years in prison and a $100,000 fine for each count.

 

The Federal Bureau of Investigation and Internal Revenue Service investigated the case, which Assistant U.S. Attorney John B. Ward is prosecuting.

 

An indictment contains only charges and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.

 

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Former stockbroker sentenced for defrauding clients

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ATLANTA - Sean Kelly has been sentenced to federal prison for wire fraud and securities fraud after pleading guilty to stealing over $1.4 million from his clients.

“Kelly never intended to fulfill his fiduciary responsibility to his clients, which included elderly citizens and veterans,” said U.S. Attorney Byung J. “BJay” Pak.  “As thieves like Kelly continue to try avoiding detection and covering their fraudulent methods, we will continue to catch them and prosecute them. We encourage people to thoroughly check out anyone that promises to shepherd their investments.”

“While it is easy to dismiss financial fraud cases as being almost benign because of their lack of violence, there is, however, a very real victimization felt and lives are changed forever,” said Chris Hacker, Special Agent in Charge of FBI Atlanta.  “The FBI is hopeful that Kelly’s sentence will send a strong message to anyone who would try to take advantage of unsuspecting clients for their own personal greed.”

According to U.S. Attorney Pak, the charges and other information presented in court: For almost five years, from January 2014 through October 2018, defendant Sean Kelly defrauded his investor clients.  Kelly was a stockbroker and investment adviser who purported to provide tax planning, insurance brokering, and other financial services to his clients.  Kelly advised his victims to invest in various ways, including through private placements, annuities, investments funds, and real estate investment trusts. 

Despite the claimed investments, Kelly instead took his victims’ money and used it for personal expenses, to include mortgage payments, Super Bowl tickets, vacations, and significant cash withdrawals.  Ultimately, he stole over $1.4 million from more than 18 clients.  In October 2018, closely following the filing of a lawsuit by the U.S. Securities and Exchange Commission, the FBI obtained a warrant based on Kelly’s fraud and arrested him.  At his sentencing, the Court found that Kelly’s fraud injured vulnerable victims, including the elderly and veterans.

Sean Kelly, 50, of Marietta, Georgia, was sentenced to five in prison to be followed by three years of supervised release, and ordered to pay restitution in the amount of $1,457,043.99.  Kelly was convicted on these charges on January 4, 2019, after he pleaded guilty.

This case was investigated by the Federal Bureau of Investigation.  The U.S. Securities and Exchange Commission contributed to this case.

Assistant U.S. Attorney Christopher J. Huber, Deputy Chief of the Complex Frauds Section, prosecuted the case.

For further information please contact the U.S. Attorney’s Public Affairs Office at USAGAN.PressEmails@usdoj.gov or (404) 581-6016.  The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.

Pickens County Sheriff to Plead Guilty to Wire Fraud and Tax Charges

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Pickens County Sheriff to Plead Guilty to Wire Fraud and Tax Charges

BIRMINGHAM – Today a federal indictment was unsealed against the longstanding sheriff of Pickens County for wire fraud and filing false tax returns, announced U.S. Attorney Jay E. Town, FBI Special Agent in Charge Johnnie Sharp, Jr. and IRS-Criminal Investigation Special Agent in Charge Thomas J. Holloman.  Also today, a plea agreement was filed in federal district court.  According to that agreement, the defendant has agreed to plead guilty to one count of wire fraud and one count of filing a false tax return.

The nine-count indictment filed in U.S. District Court charges Pickens County Sheriff DAVID EUGENE ABSTON, of Gordo, with seven counts of wire fraud and two counts of filing a false tax return. 

“A sitting county sheriff is alleged to have defrauded a food bank and a church for his personal gain at the expense of the underprivileged that the food bank serves,” Town said.  “Our office will continue to aggressively pursue and prosecute public officials who violate the public trust for their own personal gain.”

“No matter what your career or position is within our communities, all U.S. citizens are obligated to comply with the tax laws,” said Holloman. “Honest and law abiding citizens are fed up with the likes of those who use deceit and fraud to line their pockets as well as skirt their tax obligations.”

According to the indictment, as sheriff of Pickens County, Abston was responsible for the care and custody of prisoners housed in the Pickens County Jail.  That responsibility included feeding inmates housed in the jail.  In exchange, Abston was entitled to receive a specified food allowance per prisoner per day from the state of Alabama and other governmental entities.  Between 2014 and 2018, Abston received more than $400,000 in food allowance money from the state of Alabama and other governmental entities.  During that same period, Abston—like many sheriffs in Alabama—had a practice of keeping for himself any food allowance money that he did not spend to feed inmates.

During that same period Abston engaged in a scheme to defraud the West Alabama Food Bank, as well the Highland Baptist Church of Gordo, Alabama—where Abston was a member—in order to reduce his jail food expenses and increase the amount of food allowance money he could keep.

The West Alabama Food Bank (WAFB) is a non-profit based in Tuscaloosa, Alabama, with the stated mission of helping to alleviate hunger and food insecurity in nine West Alabama counties.  WAFB collects donations of food and distributes that food to partner agencies such as churches, soup kitchens, and food pantries.  To become a partner agency with WAFB, a church must submit an application stating, among other things, that the church will distribute food in compliance with WAFB policy.  The criteria for a church’s partnering with WAFB include a requirement that the church use the food it receives solely to serve the ill, needy, or infants.  In turn, WAFB provides food to its partner agencies for a nominal fee to help cover the costs of food maintenance and storage.

According to the indictment, in 2014 Abston convinced Highland Baptist Church in Gordo, Alabama, to permit him to open a bank account to be used for a church food pantry with WAFB.  Abston opened that bank account, in the name of the Highland Baptist Church Food Pantry.  Abston was the sole signatory on the account.

Around the same time, Abston applied, on behalf of the Highland Baptist Church Food Pantry, to become a partner agency of WAFB.  The application to WAFB claimed that the “general program” of the church food pantry would be to help “feed poor” and “children from disadvantage[d] and poor neighborhoods.”  The application claimed that the food pantry would use unemployment, sickness, and poverty as eligibility guidelines for food.  The application said nothing about the food pantry’s providing any food to inmates in the Pickens County Jail.

Between 2014 and 2018, Abston wrote more than $80,000 in checks from his own bank account to the church food pantry bank account, and wrote more than $80,000 in checks from the food pantry bank account to WAFB in exchange for food.

According to the indictment, Abston used a significant portion of that food to feed inmates in the Pickens County Jail.

The indictment also alleges that Abston filed false tax returns for the 2015 and 2016 tax years, because he failed to report all of his income for those years.

Each count of wire fraud carries a maximum penalty of 20 years and a fine of up to $250,000.  The maximum penalty for filing a false tax return is three years in prison and a $100,000 fine for each count.

The Federal Bureau of Investigation and Internal Revenue Service investigated the case, which Assistant U.S. Attorney John B. Ward is prosecuting.

An indictment contains only charges and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.

 

Follow us:  Twitter- @USAttyTown

 

Pennsylvania Woman Charged with Fraud For Perpetrating “Grandparents Scheme”

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PHILADELPHIA – United States Attorney William M. McSwain announced today that Yahaira Diaz, 33, of Pottsville, Pennsylvania, was charged by Information with aggravated identity theft, mail fraud, and access device fraud.  The charges against the defendant stem from her participation in what has been popularly dubbed the “Grandparents Scheme”, a type of elder financial abuse.  The charges come one day in advance of “World Elder Abuse Awareness Day” on June 15, 2019.

As alleged in the Information, the scheme operated as follows: an individual called an elderly victim posing as the grandchild of the victim, or posing as an attorney representing the grandchild. The caller claimed that the grandchild was in a vehicular accident and was arrested for driving under the influence (or some type of legal trouble). The caller then said that the grandchild needed money for bail or legal representation, and persuaded the victim to send thousands of dollars in cash via overnight delivery service to an address where the schemers retrieved the package. The schemers then continued to call the victim and demand more money until the victim realized that he or she had been defrauded and stopped sending money.

In those telephone calls, to further convince the grandparents to send cash, the co-schemers described the grandchild’s situation as increasingly serious: claiming that the grandchild had been arrested for driving under the influence; that a pregnant woman was involved in the accident; that the pregnant woman and her unborn child were injured or killed; that the grandchild would not be released from prison without additional funds; and that legal and other fees were mounting.

Diaz allegedly played a leadership role in this scheme, which she and her co-schemers perpetrated in Allentown and Bethlehem, Pennsylvania. For example, she identified and arranged for access to residential locations where her co-schemers instructed victims to send the fraud proceeds. Diaz recruited and controlled additional participants in the scheme who allowed her to use their residences for the receipt of proceeds, and who helped retrieve the packages and shared the proceeds with other co-schemers.

Diaz engaged in numerous incidents of the Grandparents Scheme as well as credit card fraud, which is also charged in the Information. In the Grandparents Scheme, Diaz and her co-schemers defrauded at least 10 elderly victims of at least $158,800 and attempted to defraud those victims of at least an additional $69,000. If convicted, the defendant faces a maximum possible sentence of 72 years in prison, including a mandatory minimum term of two years in prison.

“Crimes against the elderly target some of the most vulnerable people in our society, and schemes like the ‘Grandparent Scheme’ are particularly heinous because they prey on a senior’s love for their family,” said U.S. Attorney McSwain. “The Department of Justice is committed to protecting our seniors from fraud, and my Office will continue to prioritize prosecuting criminals who prey on our elderly residents.”

“Crimes like these against our elderly citizens are taken very seriously by law enforcement. The Bethlehem Police Department, working with its Federal partners, will investigate, arrest and prosecute individuals involved in criminal scams like these ‘Grandparent Scams,” said Mark DiLuzio, Chief of Police, Bethlehem Police Department. “As Chief, I would like to personally thank U.S. Attorney McSwain and his Office, the FBI, U.S. Postal inspectors, the Northampton County District Attorney’s Office and Bethlehem Police Detectives who all worked collectively and brought this person and her partners to justice. On behalf of all elderly citizens in the City of Bethlehem, thank you!”  

The case was investigated by the Federal Bureau of Investigation, the United States Postal Service, the Bethlehem Police Department, and the Northampton County District Attorney’s Office, and is being prosecuted by Deputy United States Attorney Louis D. Lappen.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

The Department of Justice is committed to combating elder fraud. The Department’s historic 2018 and 2019 Elder Fraud Sweeps collectively brought criminal and civil actions against more than 500 defendants responsible for defrauding more than $1.5 billion from at least 3 million victims.

The Department of Justice also provides a variety of resources relating to elder fraud victimization through its Office of Victims of Crime (OVC), which has announced a new competitive solicitation addressing enhanced multidisciplinary teams for older victims of abuse and financial exploitation (up to $375,000 each) and funding for a National Multidisciplinary Team Technical Assistance Center (for up to $3 million), which will help facilitate the expansion of elder abuse case review across the nation. The deadline is July 7, 2019.

More information about the Department’s efforts to help American seniors is available at its Elder Justice Initiative webpage. For more information about the Consumer Protection Branch and its enforcement efforts, visit its website. Elder fraud complaints may be filed with the FTC at www.ftccomplaintassistant.gov or at 877-FTC-HELP.

Nashville Heroin Distributor Sentenced to 30 Years In Federal Prison

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NASHVILLE, Tenn. – June 14, 2019 – Brandon Bradford, 40, of North Chicago, Illinois, was sentenced yesterday in U.S. District Court to 30 years in prison for conspiring to distribute  a kilogram or more of heroin, announced U.S. Attorney Don Cochran for the Middle District of Tennessee.  Bradford was convicted by a federal jury in November 2018, following a four-day trial.

Bradford, along with Terrell Pierson, aka, Tank, 33, and Justin Joplin, aka, Fat Boy, 35, both from the Chicago area, and Krystin Pape, 33, of Nashville, were indicted in May 2016 and later pleaded guilty.  Pierson and Joplin were previously sentenced to 10 years in federal prison and Pape will be sentenced next week. 

“I commend our prosecution team and our law enforcement partners at the Metropolitan Nashville Police Department and the FBI for working to build a strong case and disrupt the supply of heroin coming to our community,” said U.S. Attorney Cochran.  “This case is just one of many that these dedicated individuals undertake on a daily basis and I’m grateful for their commitment to do all they can to make Nashville and Middle Tennessee a safer place.”

The prosecution arose out of an investigation into heroin trafficking by the Metropolitan Nashville Police Department’s Gang Unit and the FBI in 2015, which identifiedBrandon Bradford as a heroin supplier who was obtaining large quantities of heroin from the Chicago, Illinois area.  Bradford conspired with several others, including Pape, Pierson and Joplin, to obtain multiple kilograms of heroin from the Chicago area on a regular basis and to distribute that heroin in the Nashville area from around September of 2014 through April 20, 2016.  Based on the evidence at trial, Bradford was conservatively responsible for more than 18 kilograms of heroin that were sold on the streets of Nashville.

The evidence at trial revealed that the amounts transported from the Chicago area for distribution in Nashville during the conspiracy ranged from approximately 50-100 grams and increased quickly to kilogram quantities as the conspiracy progressed.  As the operation grew larger, Bradford directed Pierson and Joplin, his half-brother, to move from the Chicago area to Nashville to assist him in running the operation, along with Pape.  Bradford and they shared a residence in the Bellevue area of Nashville where they frequently repackaged and prepared heroin for delivery to customers in Nashville.  Bradford, as the leader of the operation, determined the pricing for the heroin and controlled the money.

Pape and Joplin were arrested when a search warrant was executed at the residence on Stacy Drive, on April 20, 2016, and Pierson was arrested shortly thereafter.  Bradford was arrested 15 months later, in August 2017, at a hotel in New Albany, Indiana, after being actively sought by law enforcement.  At the time of his arrest, Bradford was in possession of more than 300 grams of heroin.

“This sentencing is the culmination of a collective effort between federal and local law enforcement to combat heroin trafficking in our community," said Special Agent in Charge of the Memphis Division of the Federal Bureau of Investigation M. A. Myers. "We will continue to be relentless in our mission to disrupt and dismantle drug trafficking organizations and bring the criminals who run them to justice.”

“MNPD officers and our federal partners are so serious about interdicting heroin and holding traffickers accountable because people are dying,” Chief Steve Anderson said.  “Nearly four times as many persons died in Nashville last year from drug overdoses than from the crime of murder.  I am grateful for the relationship we share with the U.S. Attorney’s Office and other federal law enforcement agencies as we investigate cases like this.”

This case was prosecuted by Assistant U.S. Attorneys Phillip H. Wehby and Brooke K.  Schiferle.

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Former Bank Vice President Who Aided the Obstruction of an FDIC Investigation Sentenced to Federal Prison

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A man who aided the obstruction of an FDIC examination was sentenced on June 13, 2019, to one year and one day in federal prison. 

Martin Smith, age 39, from Center Point, Iowa, received the prison term after an August 27, 2018 guilty plea to aiding and abetting the obstruction of an FDIC investigation. 

Smith worked as a bank vice president from 2009 to 2012.  Information at sentencing showed that, during a December 2011 FDIC examination, Smith made it appear as though a borrower’s delinquent loans had been refinanced several months prior, which kept regulators from scrutinizing those loans as part of the exam.  Information at sentencing also showed that Smith changed due dates and allowed unauthorized advances on other loans, ultimately causing the bank to incur more than $1 million in losses on loans that the bank never formally authorized and, in some circumstances, never even memorialized.  

Smith was sentenced in Cedar Rapids by United States District Court Judge C.J. Williams.  Smith was sentenced to 12 months’ and one day imprisonment.  He was ordered to make $1,270,132.97 in restitution.  He must also serve a 3-year term of supervised release after the prison term.  There is no parole in the federal system.

Smith was released on the bond previously set and is to surrender to the Bureau of Prisons on a date yet to be set.

The case was prosecuted by Assistant United States Attorney Jacob Schunk and investigated by the Federal Deposit Insurance Corporation Office of Inspector General and the United States Secret Service.  

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

The case file number is 18-CR-00076.

Follow us on Twitter @USAO_NDIA.


Lexington Man and Semiconductor Company Indicted for Theft of Trade Secrets

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BOSTON – A Chinese born naturalized U.S. citizen living in Lexington, and a company he and his wife established, were charged in federal court in Boston in connection with stealing proprietary information from his former employer, Analog Devices, Inc. (ADI), a semiconductor company headquartered in Norwood. Yu is also charged with allegedly selling and illegally exporting integrated circuits that incorporated ADI’s stolen trade secrets.

Haoyang Yu, a/k/a “Jack Yu,” a/k/a “Harry Yu,” a/k/a “Jack Tricon,” 40, of Lexington, was arrested and charged along with his company, Tricon MMIC LLC, in an indictment unsealed today. Yu was indicted on four counts of theft of trade secrets; four counts of copying, uploading, downloading, and attempted copying, uploading, and downloading of a trade secret; four counts of possession and attempted possession of a trade secret; and three counts of smuggling. Tricon MMIC LLC was also indicted on three counts of smuggling. Yu will appear this afternoon in federal court in Boston.

“Theft of trade secrets from American companies is a pervasive economic and national security threat, which makes Massachusetts, a worldwide leader in technological research and innovation, a target,” said United States Attorney Andrew E. Lelling. “Yu is charged with a massive theft of proprietary trade secret information from his former employer for the purpose of setting up his own company and marketing their products as his own. Today’s charge should make it clear that combatting the theft of trade secrets from American businesses is one of my office’s top priorities.” 

“Today’s actions are the result of the seamless coordination and collaborative counter proliferation efforts by the Office of Export Enforcement, the Justice Department, Homeland Security Investigations, NCIS and the FBI,” said Acting Special Agent in Charge William Higgins of the Office of Export Enforcement. “The Boston Field Office, Office of Export Enforcement will continue to work with all its Law Enforcement partners to stem illicit trade that threatens U.S. national security and undermines U.S. foreign policy. We will continue to vigorously pursue violators wherever they may be.”

“Violations of U.S. export laws like the ones charged in this case are serious offenses that undermine national security through the illegal export of sensitive U.S. technology and compromise the economic viability of American companies,” said Peter C. Fitzhugh, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s (ICE), Homeland Security Investigations, Boston. “Today’s enforcement actions could not have occurred without the coordinated efforts of a very dedicated team of law enforcement partners that included members of HSI’s Counter-Proliferation Investigations Center, the agency’s specialized unit dedicated to preventing the illegal export of U.S. technology and protecting American businesses by combatting transnational criminal networks and violators of our export laws.”

“As alleged, Mr. Yu stole trade secrets from his employer for his own financial gain,” said Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division. “We are deeply concerned about American innovation ending up in the wrong hands, and the FBI is committed to investigating rogue actors and foreign nations who steal our trade secrets, technology, and proprietary information for military or economic gain.  While we all welcome fair competition, we cannot and will not tolerate stealing and cheating. It’s illegal, unethical, and unfair, and this type of conduct hurts American businesses, jobs, and consumers, and in many instances, jeopardizes our national security.”

NCIS Northeast Field Office Special Agent in Charge Leo S. Lamont stated: “NCIS works closely with our partners in the FBI, HSI, and Department of Commerce to aggressively combat the theft of trade secrets and the illegal export of sensitive defense technologies. These crimes not only weaken our national security but also jeopardize the safety of our brave men and women in uniform.”

According to the charging document, Yu was born in Harbin, China, and first came to the United States in 2002 through the student visa program. He became a lawful permanent resident in June 2009, and a naturalized U.S. citizen in March 2017. In July 2014, Yu started working at ADI as a principal design engineer.

As alleged in the indictment, Yu worked for ADI designing and developing parts of monolithic microwave integrated circuits (MMICs), which are used in radio, cellular, and satellite communications as well as defense and aerospace applications. As a result of his work, Yu had access to data and information relating to the present and future product designs, schematics, manufacturing files and testing procedures. It is alleged that, while working for ADI, Yu downloaded hundreds of highly confidential schematic design files and modeling files that belonged to ADI, and copied portions of those files into spreadsheets which he uploaded to his personal Google drive account. The files Yu allegedly stole from ADI were worth millions of dollars.   

In March 2017, approximately five months before he resigned from ADI, Yu and his wife established Tricon MMIC LLC, which according to its website, “specializes in wide band MMIC amplifiers,” and serves customers in “defense and aerospace, test and instrumentation, [and] satellite communications.”

On July 31, 2017, Yu resigned from ADI and signed an agreement affirming that he had surrendered all proprietary information or data. Nevertheless, in December 2018, Yu allegedly had propriety ADI files in his possession. Furthermore, since creating Tricon in March 2017, Yu marketed and sold approximately 20 ADI designs as his own, and even used the same semiconductor fabrication plant as ADI. Yu used the Tricon website to target ADI customers, claiming that Tricon could better serve customers because ADI “has hit many customers by sudden announcements of obsolete parts.” For each purported obsolete part, Tricon listed a replacement part on its website. These replacement parts contained specifications identical to or substantially similar to ADI.

It is alleged that since leaving ADI, from August 2017 to June 2019, Yu has been working at a cleared defense contractor while simultaneously operating Tricon and selling parts that are identical to, or substantially similar, to ADI products and which incorporate ADI’s stolen trade secrets. Yu has also allegedly used Tricon to illegally export several parts to Spain by concealing both his name and the export control classification number of the parts being exported on the shipping documents.

ADI, the named victim of the Yu’s theft of trade secrets, has been cooperating with the government throughout this investigation.    

The charge of stealing, copying, downloading, and possessing a trade secret provides for a sentence of no greater than 10 years in prison, three years of supervised release and a fine of $250,000. The charge of smuggling goods from the United States provides for a sentence of no greater than 10 years in prison, three years of supervised release and a fine of $250,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.

U.S. Attorney Lelling; Acting DOC – Office of Export Enforcement SAC Higgins; HSI Boston SAC Fitzhugh; FBI Boston SAC Bonavolonta; and NCIS SAC Lamont made the announcement today. The following agencies also assisted in this investigation: Customs and Border Protection; Coast Guard Investigative Service; Defense Criminal Investigative Service; Massachusetts State Police; Lexington Police Department; and Hingham Police Department. Assistant U.S. Attorney B. Stephanie Siegmann, Chief of Lelling’s National Security Unit, and Assistant U.S. Attorney George Varghese, of Lelling’s National Security Unit, are prosecuting the case.

The details contained in the charging documents are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

Owner Of Mortgage Elimination Company Found Guilty In White Plains Federal Court Of $38 Million Fraud Conspiracy

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Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced that JACQUELINE GRAHAM was convicted at trial on Wednesday, June 12, 2019, of participating in a conspiracy to commit bank fraud, wire fraud, and mail fraud in connection with a fraudulent debt-elimination scheme to defraud homeowners and banks.  GRAHAM was found guilty of the one count she faced after a two-week trial before U.S. District Judge Nelson S. Román.

Manhattan U.S. Attorney Geoffrey S. Berman said:  “Jacqueline Graham preyed on vulnerable homeowners who could not afford their mortgage payments during a time of crisis in the housing market.  Because of her greed, these homeowners ended up financially worse off than when they found her.  We will continue to work with our law enforcement partners to bring to justice those who victimize the vulnerable.”

According to the Indictment in the case and the evidence presented at trial:

From at least 2011 to at least 2012, JACQUELINE GRAHAM partnered with Bruce Lewis and John Ruzza in operating the Valhalla, New York-based Terra Foundation (“Terra”) – which was originally known as the Pillow Foundation – which held itself out as a business that would investigate and eliminate mortgage loans in exchange for fees, soliciting clients who were having difficulties making their mortgage payments.  In fact, however, Terra engaged in a wide-ranging scheme to defraud clients, county clerks’ offices, and banks.

The fraudulent scheme, which was created by GRAHAM and Lewis, involved Terra performing “audits” of clients’ mortgages, sending pseudo-legal paperwork to the banks and/or lenders holding the mortgages, and ultimately filing purported mortgage discharges with the relevant county clerks’ offices, which discharges were signed by Lewis or other co-conspirators, claiming falsely to represent the banks and/or mortgage lenders.  As a result, anyone doing a title search for one of Terra’s clients would see that the client’s mortgage had been satisfied.  The mortgages had not, however, been discharged, and the mortgages were eventually reinstated, after the clients paid their fees.

In order to effectuate the scheme, GRAHAM, Lewis, and Ruzza involved others, including Rocco Cermele, who was Terra’s director of operations and who recruited clients, among other duties; Paula Guadagno, who did real estate title work for, and filed discharges on behalf of, Terra; and Anthony Vigna, a lawyer and CPA who worked in Terra’s offices.

To profit from their scheme, GRAHAM and her co-conspirators charged various fees to Terra’s clients.

In total, GRAHAM and her co-conspirators filed over 60 fraudulent discharges in Westchester and Putnam Counties in New York, and in Connecticut.  The fraudulent discharges claimed to discharge mortgages with a total loan principal of nearly $38 million.

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GRAHAM, 53, formerly of Levittown, Pennsylvania, was convicted of one count of conspiracy to commit bank fraud, wire fraud, and mail fraud.  The count carries a maximum sentence of 30 years in prison.  

Lewis, 67, formerly of Alaska and Washington State, pled guilty to one count of wire fraud relating to the Terra scheme, which carries a maximum sentence of 20 years in prison.

Vigna, 61, of Thornwood, New York, pled guilty to one count of participating in a conspiracy to commit bank fraud, wire fraud, and mail fraud relating to the Terra scheme, which carries a maximum sentence of five years in prison.

Cermele, 56, of Yonkers, New York, pled guilty to one count of participating in a conspiracy to commit mail, wire, and bank fraud, and one count of wire fraud, each relating to the Terra scheme, each of which carries a maximum potential sentence of 30 years in prison, and three additional counts of wire fraud relating to other crimes, each of which carries a maximum potential sentence of 20 years in prison.

The statutory maximum penalties are prescribed by Congress and are provided here for informational purposes only, as any sentencings of the defendants would be determined by the court.

All defendants are awaiting sentencing.

Mr. Berman praised the outstanding investigative work of the Federal Bureau of Investigation.  Mr. Berman also thanked the Office of the Westchester County District Attorney’s Office and the Department of Housing and Urban Development for their assistance in the case.

This case is being handled by the Office’s White Plains Division.  Assistant United States Attorneys David Felton, Michael Maimin, and James McMahon are in charge of the prosecutions.

Allentown Man Charged With Mail Fraud And Money Laundering

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HARRISBURG - The United States Attorney’s Office for the Middle District of Pennsylvania announced that Anthony W. Redd, age 63, of Allentown, Pennsylvania, was indicted on June 12, 2019, by a federal grand jury on mail fraud and money laundering charges.

According to United States Attorney David J. Freed, the indictment alleges that Redd was a “Money Mule” and participated in a scheme to defraud individuals out of money by making them believe they were eligible for cash and other prizes.  As part of the scheme, Redd is alleged to have caused the mailing of legitimate postal money orders from Mechanicsburg to his address in Allentown, Pennsylvania, and to have converted the known proceeds of the scheme to cash or to have sent the proceeds through Western Union or MoneyGram to Costa Rica.  The 12-count indictment charged Redd with five separate counts of mail fraud, engaging in a mail fraud and money laundering conspiracy, and both domestic and international money laundering.  The indictment also includes a notice of the Government’s intent to seize and forfeit more than $280,000 involved in the scheme.

The case was investigated by the U.S. Postal Inspection Service. Assistant U.S. Attorney James T. Clancy is prosecuting the case.

Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.

A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.

The maximum penalty under federal law for the conspiracy offense is 5 years of imprisonment, a term of supervised release following imprisonment, and a fine.  The maximum sentence for each of the mail fraud and money laundering counts is 20 years of imprisonment, a term of supervised release following imprisonment, and a fine.  Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.

 

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Harrisburg Man Charged With Drug Trafficking And Firearm Offenses

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HARRISBURG - The United States Attorney’s Office for the Middle District of Pennsylvania announced that Donald Jackson, age 33, of Harrisburg, Pennsylvania, was indicted on June 12, 2019, by a federal grand jury on drug trafficking and firearms charges.

According to United States Attorney David J. Freed, the indictment alleges that Jackson distributed cocaine base, also known as crack cocaine, possessed with intent to distribute marijuana and methamphetamine, and illegally possessed a Ruger 9mm pistol in furtherance of drug trafficking and as a previously convicted felon. 

The case was investigated by the Harrisburg Bureau of Police and the Pennsylvania Office of Attorney General Mobile Street Crimes Unit with assistance of the Bureau of Alcohol, Tobacco, Firearms and Explosives.  Assistant U.S. Attorney James T. Clancy is prosecuting the case.

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime. 

This case was also brought as part of a district wide initiative to combat the nationwide epidemic regarding the use and distribution of heroin.  Led by the United States Attorney’s Office, the Heroin Initiative targets heroin traffickers operating in the Middle District of Pennsylvania and is part of a coordinated effort among federal, state and local law enforcement agencies to locate, apprehend, and prosecute individuals who commit heroin related offenses.

Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.

A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.

The maximum penalty under federal law for the drug trafficking offenses is 20 years of imprisonment, a term of supervised release following imprisonment, and a fine.  The maximum sentence for possessing a firearm in furtherance of drug trafficking is life in prison, a term of supervised release following imprisonment, and a fine.  The maximum sentence for possessing a as a convicted felon is 10 years in prison, a term of supervised release following imprisonment, and a fine.  Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.

 

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York Man Sentenced To Over 21 Years’ Imprisonment On Drug Trafficking Charges

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HARRISBURG - The United States Attorney’s Office for the Middle District of Pennsylvania announced that Raul Cotto-Rivera, age 41, of York, Pennsylvania, was sentenced on June 11, 2019, to 262 months’ imprisonment followed by five years of supervised release by U.S. District Court Judge Yvette Kane for drug trafficking offenses.

According to United States Attorney David J. Freed, Cotto-Rivera was convicted in March 2018, after a three-day jury trial, of conspiracy to distribute 100 grams and more of heroin and 500 grams and more of cocaine hydrochloride, distribution of heroin (3 counts), possession with intent to distribute heroin and cocaine hydrochloride, distribution of marijuana and possession with intent to distribute cocaine base, cocaine hydrochloride and marijuana,

The charges stemmed from a number of controlled buys of heroin that were made by and through Cotto-Rivera in September and October of 2015.  In October 2015, law enforcement obtained and executed a search warrant and located approximately $20,000 in United States currency, a drug ledger, drug packaging material and distribution quantities of cocaine and heroin all in the defendant’s home.  While on release, Cotto-Rivera continued to sell drugs and was engaged in the distribution of marijuana from his store.  A second search warrant executed in February 2017, located distribution quantities of marijuana and cocaine, drug packaging materials and a loaded stolen firearm.

The investigation was conducted by the FBI Safe Streets Task Force, the York County Drug Task Force, the Pennsylvania State Police, the York Area Regional Police Department, the West Manchester Township Police Department, the York County Sheriff’s Office, the Springettsbury Township Police Department, and the York County District Attorney’s Office.  Assistant United States Attorneys Daryl F. Bloom and Carl Marchioli prosecuted the case.

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.

This case was brought as part of a district wide initiative to combat the nationwide epidemic regarding the use and distribution of heroin.  Led by the United States Attorney’s Office, the Heroin Initiative targets heroin traffickers operating in the Middle District of Pennsylvania and is part of a coordinated effort among federal, state and local law enforcement agencies to locate, apprehend, and prosecute individuals who commit heroin related offenses.

           

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United States Penitentiary Canaan Inmate Pleads Guilty To Assault Of Correctional Officer And Is Sentenced To Serve An Additional 15 Months In Prison

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WILKES-BARRE - The United States Attorney’s Office for the Middle District of Pennsylvania announced that Johnny Fletcher, age 41, formerly of South Carolina and currently an inmate at the United States Penitentiary Canaan, pleaded guilty on June 12, 2019, before Senior U.S. District Court Judge A. Richard Caputo, to assault on a correctional officer and was immediately sentenced to serve an additional 15 months in prison.  

According to United States Attorney David J. Freed, Fletcher admitted to punching a correctional officer on February 5, 2019, after Fletcher set off a metal detector and refused to submit to a search by the correctional officer. 

The case was investigated by the Federal Bureau of Investigation and the Bureau of Prisons Special Investigative Service.  Assistant United States Attorney Robert J. O’Hara prosecuted the case.

 

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Harrisburg Man Sentenced To Over Twenty-One Years’ Imprisonment For Drug Trafficking And Firearms Offenses

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HARRISBURG—The United States Attorney’s Office for the Middle District of Pennsylvania announced that Robert Hendrix, Jr., age 39, of Harrisburg, Pennsylvania, was sentenced on June 13, 2019, by United States District Court Judge Sylvia H. Rambo to 262 months’ imprisonment to be followed by six years of supervised release for drug trafficking and firearms offenses.

According to United States Attorney David J. Freed, Hendrix previously admitted to possessing with the intent to distribute crack cocaine and possessing multiple firearms as a previously convicted felon. 

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.

The investigation was conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Harrisburg Police Bureau.  Assistant U.S. Attorney Carlo D. Marchioli prosecuted the case.

 

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Monroe County Man Was Sentenced To 11 Years In Prison For Role In Heroin And Cocaine Trafficking Conspiracy

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WILKES-BARRE - The United States Attorney’s Office for the Middle District of Pennsylvania announced that Joseph Morales, age 27, of Tobyhanna, Pennsylvania, was sentenced on June 12, 2019, by Senior U.S. District Court Judge A. Richard Caputo to eleven years’ imprisonment and ten years on supervised release for his role in a Monroe County-based heroin and cocaine trafficking conspiracy.

According to United States Attorney David J. Freed, Morales previously pleaded guilty to conspiring with others to distribute between 700 grams and one kilogram of heroin (which is equivalent to 28,000 to 40,000 individual doses of heroin), as well as between 840 grams and 2.8 kilograms of crack cocaine, in the Monroe County area between May and July 2015.  Morales was one of eleven individuals indicted by a grand jury in July 2015 and charged with conspiring to distribute heroin, powder cocaine and crack cocaine in the Monroe County area.

The case was investigated by the Drug Enforcement Administration (DEA) and the Pocono Mountain Regional Police Department.  Assistant United States Attorney Robert J. O’Hara prosecuted the case.

This case is 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.  The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local and tribal enforcement and the local community to develop effective, locally-based strategies to reduce crime.

This case was also brought as part of a district wide initiative to combat the nationwide epidemic regarding the use and distribution of heroin.  Led by the United States Attorney’s Office, the Heroin Initiative targets heroin traffickers operating in the Middle District of Pennsylvania and is part of a coordinated effort among federal, state and local law enforcement agencies to locate, apprehend, and prosecute individuals who commit heroin related offenses.   

This prosecution is also part of an extensive investigation by the Organized Crime Drug Enforcement Task Force (OCDETF).  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 level drug trafficking organizations and coordinating the necessary law enforcement entities and resources to disrupt or dismantle the targeted criminal organization and seize their assets.

 

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Monroe County Man Pleads Guilty To Heroin And Cocaine Trafficking

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WILKES-BARRE - The United States Attorney’s Office for the Middle District of Pennsylvania announced that Sherquille Ernest, age 26, of Mount Pocono, Pennsylvania, pleaded guilty on June 12, 2019, before U.S. District Court Senior Judge A. Richard Caputo to the charge of conspiracy to distribute heroin and crack cocaine.  

According to United States Attorney David J. Freed, Morales admitted to participating in a conspiracy to distribute between 20 and 40 grams of heroin (which is equivalent to 800 to1,600 individual doses of heroin), as well as between 28 and 112 grams of crack cocaine, in the Monroe County area between May and July 2015.  Ernest was one of eleven individuals indicted by a grand jury in July 2015, and charged with conspiring to distribute heroin, powder cocaine and crack cocaine in the Monroe County area.

Judge Caputo ordered a presentence report to be completed.  Sentencing will be scheduled at a later date.         

The investigation was conducted by the Drug Enforcement Administration (DEA) and the Pocono Mountain Regional Police Department.  Assistant United States Attorney Robert J. O’Hara is prosecuting the case.

This case was brought as part of a district wide initiative to combat the nationwide epidemic regarding the use and distribution of heroin.  Led by the United States Attorney’s Office, the Heroin Initiative targets heroin traffickers operating in the Middle District of Pennsylvania and is part of a coordinated effort among federal, state and local law enforcement agencies to locate, apprehend, and prosecute individuals who commit heroin related offenses.          

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.        

A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.

The charge carries a mandatory minimum sentence of five years in prison.  The maximum penalty under federal law is up to forty years in prison, a term of supervised release following imprisonment, and a fine.  Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.

 

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Schuylkill County Man Guilty Of Heroin Trafficking Conspiracy

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SCRANTON—The United States Attorney’s Office for the Middle District of Pennsylvania announced that Anthony Navarro-Velez, age 33, of Shenandoah, Pennsylvania, pleaded guilty on June 6, 2019, before Senior U.S. District Court Judge James M. Munley, to conspiracy to distribute and possess with intent to distribute more than a kilogram of heroin.

According to United States Attorney David J. Freed, the defendant admitted to participating in the conspiracy during 2014 and 2015. Navarro-Velez admitted that he and others in the conspiracy distributed between one and three kilograms of heroin, which is approximately equivalent to between 40,000 and 120,000 retail bags of heroin.

Judge Munley ordered a pre-sentence investigation to be completed, and scheduled sentencing for September 9, 2019.

The case was investigated by the Federal Bureau of Investigation, the Pennsylvania State Police, and the Shenandoah Police. Assistant U.S. Attorney Francis P. Sempa is prosecuting the case.

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.

This case was also brought as part of a district wide initiative to combat the nationwide epidemic regarding the use and distribution of heroin.  Led by the United States Attorney’s Office, the Heroin Initiative targets heroin traffickers operating in the Middle District of Pennsylvania and is part of a coordinated effort among federal, state and local law enforcement agencies to locate, apprehend, and prosecute individuals who commit heroin related offenses.        

The maximum penalty under federal law for this offenses is life imprisonment, a term of supervised release following imprisonment, and a fine. There is also a mandatory minimum sentence of 10 years’ imprisonment. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.

 

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Cuban Man Sentenced To 27 Months’ Imprisonment For Drug Trafficking Offenses

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SCRANTON – The United States Attorney’s Office for the Middle District of Pennsylvania announced that on June 11, 2019, David Alzugaray-Lugones, age 50, a Cuban refugee from Weatherly, Pennsylvania, was sentenced to 27 months’ imprisonment and three years of supervised release, by United States District Court Judge Malachy E. Mannion, for drug trafficking offenses.

According to United States Attorney David J. Freed, Alzugaray-Lugones was convicted following a 13-day jury trial of conspiring to distribute 15 grams of heroin from June 2, 2015 and June 8, 2015, and for distributing five grams of heroin on June 8, 2015.  Alzugaray-Lugones also attempted to obstruct justice by authoring a letter sent to law enforcement, in which he claimed responsibility for C-4 explosives crimes committed by one of his co-conspirators.

Alzugaray-Lugones’s codefendants, Roberto Torner and Liza Robles, also were convicted at trial of various heroin trafficking, firearms, and explosives charges.  Torner and Robles both are awaiting sentencing.

The case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives, the Weatherly Police Department, the Luzerne County Drug Task Force, the Pennsylvania State Police, and other federal, state, and local law enforcement agencies.  Assistant United States Attorneys Phillip Caraballo and Todd Hinkley prosecuted the case.

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.

The case was brought as part of a district wide initiative to combat the nationwide epidemic regarding the use and distribution of heroin.  Led by the United States Attorney’s Office, the Heroin Initiative targets heroin traffickers operating in the Middle District of Pennsylvania and is part of a coordinated effort among federal, state and local law enforcement agencies to locate, apprehend, and prosecute individuals who commit heroin related offenses.

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Rogers Man Sentenced To 1 Year In Federal Prison For Social Security Fraud

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Fayetteville, Arkansas - Duane (DAK) Kees, United States Attorney for the Western District of Arkansas, announced that Mike Bailey, age 49, of Rogers, Arkansas, was sentenced this week to 12 months in federal prison followed by three years of supervised release, and restitution in the amount of $123,181.00 for one count of Theft of Government Funds. The Honorable Timothy L. Brooks presided over the sentencing hearing in the United States District Court in Fayetteville.

According to court records, Bailey applied for Social Security Disability Benefits in 2003 citing pain and mental health issues, but was denied. In 2005, Bailey was approved for Social Security Benefits. Pursuant to the application, Bailey agreed to notify the Social Security Administration of any changes in his ability to work and his employment status. In 2017, Bailey completed a “Continuing Disability Review Report,” and claimed that he had not worked since his last medical decision. Subsequently, investigators discovered that Bailey was self-employed as a fishing guide for the past eight (8) years, and had lead 3-4 trips per week during that period. In April 2018, investigators observed Bailey’s work as a fishing guide. Investigators were able to observe Bailey completing tasks that he indicated that he was unable to complete.  Bailey exhibited mental acuity inconsistent with his earlier professed mental limitations. Bailey admitted that he did receive Social Security Disability Benefits that he knew he was not entitled. Bailey’s scheme resulted in an aggregate value of $123,181.00, which he was not entitled to receive.

Bailey was indicted by a federal grand jury in July 2018, and entered a guilty plea in January 2019.

This case was investigated by Detective Charles Briscoe of the Office of the Inspector General, Social Security Administration, working jointly with the Arkansas Attorney General’s Office (AG), United States Secret Service, and Arkansas Game and Fish Commission. Assistant United States Attorney Amy Driver prosecuted the case for the United States.

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