A man who conspired to distribute methamphetamine pled guilty December 30, 2019, in federal court in Sioux City.

Emmanuel Fuentes, 35, from Madelia, Minnesota, was convicted of conspiracy to distribute methamphetamine.

At the plea hearing, Fuentes admitted that from July 2019 through August 2019, he was involved in the distribution of more than 150 grams of pure methamphetamine.  In two separate investigative operations, in July and August 2019, law enforcement seized more than ten ounces of methamphetamine from Fuentes.   

Sentencing before United States District Court Chief Judge Leonard T. Strand will be set after a presentence report is prepared.  Fuentes remains in custody of the United States Marshal pending sentencing.  Fuentes faces a mandatory minimum sentence of 10 years’ imprisonment and a possible maximum sentence of life imprisonment, a $10,000,000 fine, and at least 5 years of supervised release following any imprisonment.

The case is being prosecuted by Assistant United States Attorney Shawn S. Wehde and was investigated by the Tri-State Drug Task Force based in Sioux City, Iowa, that consists of law enforcement personnel from the Drug Enforcement Administration; Sioux City, Iowa, Police Department; Homeland Security Investigations; Woodbury County Sheriff’s Office; South Sioux City, Nebraska, Police Department; Nebraska State Patrol; Iowa National Guard; Iowa Division of Narcotics Enforcement; United States Marshals Service; South Dakota Division of Criminal Investigation; and Woodbury County Attorney’s Office.   

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

The case file number is 19-4053.  Follow us on Twitter @USAO_NDIA.

Defendant Joanna De Alba,a U.S. citizen,will be arraigned this afternoon in federal court in Brooklyn on an indictment charging her with conspiring to distribute and possess with intent to distribute heroin and methamphetamine, and distribution of heroin and methamphetamine via the “dark web.”  De Alba was detained on October 24, 2019 at the U.S.-Mexico border while attempting to enter the United States.  The arraignment will be held before United States Magistrate Judge Steven L. Tiscione.

Richard P. Donoghue, United States Attorney for the Eastern District of New York, and Ray Donovan, Special Agent-in-Charge, Drug Enforcement Administration, New York Division (DEA), announced the charges.

“As alleged, De Alba dispensed heroin and methamphetamine from the shadowy corners of the internet, believing that it provided anonymity to her and her customers,” stated United States Attorney Donoghue.  “But thanks to the outstanding work by this Office’s prosecutors and DEA special agents, a bright light has been shined on her activities, and she will now be held to account for her charged criminal acts.”

“Anonymity is what drug dealers rely on in the dark web, but this case proves it’s a false security.  Law enforcement is committed to tracking down drug traffickers’ distribution networks everywhere,” stated DEA Special Agent-in-Charge Donovan.

The internet contains online marketplaces for narcotics and other contraband on the “dark web,” a part of the internet located beyond the reach of traditional internet browsers and accessible only through networks designed to conceal user identities.  As alleged, the “Wall Street Market” was a global dark web marketplace that required its users to trade in digital currencies, primarily Bitcoin. 

Between June 2018 and May 2019, De Alba allegedly advertised and sold illegal narcotics on the Wall Street Market, using the moniker “RaptureReloaded.”  Customers were directed to pay her in Bitcoin, and contact her through encrypted email and messaging services.  De Alba offered customers free shipping to addresses in the United States, and “stealth” delivery options ranging from “Basic Stealth” and “Better Stealth,” to “Super Stealth 360.”  These options featured measures to conceal the external and internal packaging of illegal narcotics to evade detection by law enforcement, and to inform buyers if law enforcement had intercepted, tampered with, or was monitoring the shipment.

On January 3, 2019, an undercover DEA agent accessed the RaptureReloaded listing on the Wall Street Market and purchased 30 grams of heroin for a total of $1,810.  Later that day, the undercover agent purchased 10 grams of methamphetamine from the RaptureReloaded listing for a total of $160.  As requested, the undercover agent paid for the drugs with Bitcoin.  On January 14, 2019, the undercover agent retrieved a package shipped by RaptureReloaded via the U.S. postal service to a mailbox in Queens, New York.  The package contained a small plastic container containing approximately 30 grams of a substance that tested positive for heroin, and a clear plastic bag containing approximately 10 grams of a substance that tested positive for methamphetamine.  Between August 2018 and January 2019, law enforcement agents intercepted five packages containing methamphetamine pills and fentanyl that were shipped from the Netherlands and Canada and addressed to De Alba’s deceased husband at an apartment in southern California.  Allegedly, since her husband’s death in March 2018, De Alba used his identity and credit cards to fund her narcotics business on the Wall Street Market.

If convicted of all counts, De Alba faces a mandatory minimum term of five years’ imprisonment and a maximum sentence of up to 100 years in prison.

The charges in the indictment are allegations, and the defendant is presumed innocent unless and until proven guilty.

The government’s case is being prosecuted by Assistant United States Attorneys Saritha Komatireddy and Francisco J. Navarro.

The Defendant:

JOANNA DE ALBA (also known as “RaptureReloaded”)
Age: 39
Tijuana, Mexico

E.D.N.Y. Docket No. 19-CR-563 (DLI)

ALBANY, NEW YORK – Randy Mandiville, age 31, of Kerhonkson, New York, was sentenced today to 42 months in prison for his involvement in a drug trafficking organization in Ulster County that was dismantled and indicted in March 2019. 

The announcement was made by United States Attorney Grant C. Jaquith; Peter C. Fitzhugh, Special Agent in Charge of Homeland Security Investigations (HSI), New York; Ulster County Sheriff Juan Figueroa, whose office leads the Ulster Regional Gang Enforcement Narcotics Team (URGENT); New York State Police Superintendent Keith M. Corlett; and Village of Ellenville Police Chief Philip Mattracion.

As part of his plea, Mandiville admitted that between February and December 2018, in cooperation with co-conspirators, he sold at least 16.8 grams of crack cocaine on behalf of the organization in various locations around Ellenville. 

U.S. District Judge Mae A. D’Agostino also sentenced Mandiville to serve a 6-year term of supervised release upon his release from prison.

The following defendants have also pled guilty in connection with the conspiracy, and face the following penalties:

The following defendants still face charges in this case, and face the following penalties:

Naveo is also charged with unlawful possession of a Mossberg shotgun as a felon.  The charges against these defendants are merely accusations. The defendants are presumed innocent unless and until proven guilty.

This case is being investigated by HSI, the Ulster County Sheriff’s Office in conjunction with URGENT, an inter-agency taskforce targeting drug dealers and gang members in Ulster County, and the New York State Police, with assistance from the Village of Ellenville Police and the Ulster County District Attorney’s Office.  The case is being prosecuted by Assistant U.S. Attorney Emmet J. O’Hanlon.

John H. Durham, United States Attorney for the District of Connecticut, today announced that the U.S. Attorney’s Office has reached a settlement agreement with the AmericInn by Wyndham Hotel in Griswold to resolve allegations that the hotel had not been operating in compliance with the Americans with Disabilities Act of 1990 (“ADA”).

The settlement agreement resolves an ADA complaint filed by an individual with disabilities alleging that the AmericInn by Wyndham Hotel, Griswold, owned and managed by Champion Griswold, LLC, was not accessible for individuals with physical disabilities.  The hotel is in the process of making the changes required by the settlement agreement, which include significant improvements to designated accessible guest rooms, accessible public restrooms, eating and recreation areas and the addition of signage for parking spaces, for individuals with disabilities.  The hotel will continue to make improvements over the next three years.

Under federal law, private entities that own or operate “places of public accommodation,” including hotels, are prohibited from discriminating on the basis of disability.  The ADA authorizes the U.S. Department of Justice to investigate complaints and undertake periodic reviews of compliance of covered entities.  The Department of Justice is also authorized to commence a civil lawsuit in federal court in any case that involves a pattern or practice of discrimination or that raises issues of general public importance, and to seek injunctive relief, monetary damages, and civil penalties.

U.S. Attorney Durham noted that the AmericInn by Wyndham, Griswold Hotel’s management has worked quickly and cooperatively with the U.S. Attorney’s Office to address the ADA issues without litigation.

Any member of the public who wishes to file a complaint alleging that a hotel or any other place of public accommodation in Connecticut is not accessible to persons with disabilities may contact the U.S. Attorney’s Office at 203-821-3700.

Additional information about the ADA can be found at www.ada.gov, or by calling the Justice Department’s toll-free information line at (800) 514-0301 and (800) 514-0383 (TTY).  More information about the Civil Rights Division and the laws it enforces is available at www.justice.gov/crt.

This matter was handled by Assistant U.S. Attorney Ndidi N. Moses of the District of Connecticut in coordination with the Disability Rights Section of the U.S. Department of Justice Civil Rights Division

KANSAS CITY, Mo. – A Maitland, Missouri, man pleaded guilty in federal court today to robbing banks in St. Joseph, Missouri, and Kansas City, Missouri.

Nicholas Lehman, 39, pleaded guilty before U.S. District Judge Roseann Ketchmark to two counts of bank robbery.

By pleading guilty today, Lehman admitted that he stole $4,450 from Citizen’s Bank and Trust, 5305 N. Belt Hwy., St. Joseph, on March 18, 2019. Lehman also admitted that he stole $1,940 from National American Savings Bank, 7012 N.W. Barry Rd., Kansas City, on March 20, 2019.

Lehman admitted that he approached the teller at Citizen’s Bank and Trust and gave her a handwritten note that demanded money, stated he had a gun, and claimed the teller’s family was being held hostage. Lehman, who didn’t exhibit a gun during the incident, told the teller to give him all of her money. The teller emptied her drawer and gave him $4,450.

Lehman did not conceal his face during the robbery and his image was captured by the bank’s surveillance system. Photos of Lehman were broadcast to the public through local news stations. Several individuals who knew him contacted the FBI and stated they believed he was the person responsible for the robberies.

Two days later, Lehman approached the teller’s counter at National American Savings Bank and gave the teller a note that read, “This is a robbery. NO ALARMS INK PACKS ALL BIG BILLS and NO ONE gets hurt. 5 minutes before ALARM someone is watching your family or they all get….. For an amount of 10,000.” The teller told Lehman she didn’t have that much cash, but emptied her drawer. Lehman grabbed the money and ran out of the bank.

The next day, on March 21, 2019, law enforcement officers attempted to apprehend Lehman, who was driving a 2011 Ford Edge, near the Kansas City International Airport. Lehman refused to stop and a high-speed chase ensued. Lehman stopped his car in Kansas City, Kansas, and fled on foot. He was eventually apprehended and arrested.

Under federal statutes, Lehman is subject to a sentence of up to 20 years in federal prison without parole on each of the two counts. 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.

This case is being prosecuted by Assistant U.S. Attorney Matt Moeder. It was investigated by the FBI, the Buchanan County, Mo., Sheriff’s Department, and the Kansas City, Mo., Police Department.

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, and William F. Sweeney Jr., the Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced today the unsealing of an indictment charging BLACKLIGHT, S.A., a Swiss entity purporting to offer asset management and trustee services, and its founder and principal owner, KENNETH CIAPALA, as well as ULRIK DEBO, a/k/a “Molgaard Debo,” a/k/a “Ulrik Molgaard,” with engaging in a long-running stock manipulation scheme involving numerous United States issuers.  CIAPALA and DEBO were arrested in the United Kingdom, and the United States Government will be seeking their extradition to the United States. 

U.S. Attorney Geoffrey S. Berman said:  “As alleged, for years the Swiss firm Blacklight, S.A., its owner, Kenneth Ciapala, and Ulrik Debo have made millions of dollars by orchestrating stock manipulation schemes of publicly traded shares of U.S.-based issuers.  Today’s charges make clear that our Office, along with our law enforcement partners, will vigorously prosecute those who allegedly manipulate the stocks of U.S. issuers, including those operating abroad.” 

FBI Assistant Director William F. Sweeney Jr. said:  “As a major facilitator of market manipulation schemes, Blacklight, S.A, allegedly enabled numerous ‘pump and dumps’ over the course of six years.  Disrupting the orchestrators of illegal financial activity is a top priority for the FBI’s securities fraud team, and we consider today’s indictment of Blacklight, its founder and principal owner Kenneth Ciapala, and co-conspirator Ulrik Debo an important step in that mission.”           

As alleged in the Indictment unsealed in Manhattan federal court[1]:

BLACKLIGHT, S.A. (“BLACKLIGHT”), a Swiss entity based in Geneva, Switzerland, that purported to offer asset management and trustee services to its clients, and a founder and co-principal of BLACKLIGHT, KENNETH CIAPALA, executed a wide-ranging stock manipulation scheme that spanned from in or about 2013 through December 2019 in which they manipulated the share price and trading volume of the publicly traded shares of multiple companies, and laundered the proceeds generated by the scheme.  CIAPALA, utilizing BLACKLIGHT, set up various nominee entities to help scheme participants conceal their ownership of public company shares and evade SEC reporting requirements.  BLACKLIGHT opened bank accounts and brokerage accounts on behalf of these nominee entities and executed trades in accounts held by these nominee entities in furtherance of the stock manipulation scheme. 

ULRIK DEBO, a Danish citizen who resided in Europe, furthered the stock manipulation scheme by, among other things, identifying suitable publicly traded shell companies that could be used in the scheme; identifying, in certain instances, suitable privately held companies to engage in “reverse merger” transactions with the shell companies; obtaining financing to purchase all or substantially all of the outstanding shares of the issuers; causing various nominee entities to obtain ownership of the issuer’s shares; identifying and paying “promoters” that issued exaggerated and, at times, false press releases about the issuers in order to raise the trading price and volume of the issuer’s shares; and identifying and paying various “trading specialists” who assisted in artificially manipulating the trading volume and price of the issuer’s shares.

Overview of the Stock Manipulation Scheme

As alleged, from at least 2013 through December 2019, CIAPALA and his firm, BLACKLIGHT, as well as others, conspired to defraud the investing public by orchestrating and facilitating the manipulation of multiple publicly traded stocks, commonly referred to as “pump and dump” schemes.  The vast majority of the stocks that CIAPALA, BLACKLIGHT, DEBO, and their co-conspirators sought to manipulate were “penny” or “microcap” stocks that traded in the United States on the over-the-counter (“OTC”) market.  In executing these pump and dump schemes, CIAPALA, BLACKLIGHT, DEBO, and their co-conspirators (i) secretly amassed beneficial ownership of all, or substantially all, of the stock of certain publicly traded companies; (ii) began manipulating the price and demand for these stocks through, among other means, the release of materially false information to the investing public and manipulative trading practices, thereby causing the share price of these stocks to become artificially inflated; and (iii) sold out of their secretly-amassed positions at artificially inflated values at the expense of the investing public. 

CIAPALA, using his firm BLACKLIGHT, primarily furthered the stock manipulation scheme by helping other participants in the scheme to obscure their beneficial ownership and control of all or substantially all of the shares of companies whose securities they sought to manipulate.  CIAPALA caused BLACKLIGHT to establish nominee entities that were registered in the names of various third parties to hold the shares that were, in reality, beneficially owned and controlled by the scheme participants.  In order to obscure their ownership interests, CIAPALA, BLACKLIGHT, DEBO, and others typically caused these nominee entities’ holdings to be structured so as to ensure that no single nominee entity held more than five percent of the outstanding stock of any of the relevant companies.

CIAPALA also caused BLACKLIGHT to open bank accounts in the names of these nominee entities and to trade shares owned by these nominee entities through various brokerage accounts.  Through BLACKLIGHT, CIAPALA exercised trading authority over these nominee entities’ shares, and CIAPALA directed brokers to execute trades on behalf of these nominee entities in furtherance of the stock manipulation scheme.  After CIAPALA, BLACKLIGHT, DEBO, and others participating in the scheme had obtained control of all or substantially all of the shares of a company, the scheme participants manipulated the share price and trading volume of the stock of the company.  This typically occurred through a promotional campaign and through certain manipulative trading practices. 

With respect to the promotional campaign, CIAPALA, BLACKLIGHT, DEBO, and others participating in the scheme caused promotional materials to be distributed to the investing public that contained exaggerated and, at times, false claims about the company whose stock they sought to manipulate. The scheme participants concealed from the investing public that these promotional materials were financed and created at the direction of those who beneficially owned and controlled substantially all of the shares of the relevant company that was the subject of the promotion. 

In addition, to drive investor demand and artificially inflate the share price, CIAPALA, BLACKLIGHT, DEBO, and other participants also engaged in manipulative trading activity in order to artificially increase the trading volume and share price of the issuers whose stock they sought to manipulate.  This manipulative trading activity included “match” trades whereby the scheme participants caused multiple nominee entities they controlled to essentially trade with one another to create the false appearance of trading volume and demand for the stock. 

Laundering of the Profits Generated by the Scheme           

As a result of the stock manipulation scheme, the scheme’s participants reaped millions of dollars in illicit profits by selling the shares they beneficially owned and controlled into the market at artificially inflated prices.  After these crime proceeds were generated, CIAPALA and BLACKLIGHT allegedly assisted other scheme participants in obtaining their share of the proceeds by sending these funds to them in a manner designed to conceal the source of these funds and the identity of the true recipients of the funds.  With CIAPALA’s knowledge and at times at his direction, transfers of the proceeds of the stock manipulation scheme were executed in a manner intended to conceal the true source of the funds and the recipients of these funds by, for example, using fabricated invoices to justify wire transfers from accounts held in the names of nominee entities (controlled and operated by BLACKLIGHT) to other bank accounts controlled by the scheme participants.   

*                *                *

The Indictment charges CIAPALA, 38, who resides in Switzerland, and BLACKLIGHT with one count of conspiracy to commit securities fraud, which carries a maximum sentence of five years in prison; three counts of securities fraud, each of which carries a maximum sentence of 20 years in prison; one count of conspiracy to commit wire fraud, which carries a maximum sentence of 20 years in prison; wire fraud, which carries a maximum sentence of 20 years in prison; conspiracy to commit money laundering, which carries a maximum sentence of 20 years in prison; and money laundering, which carries a maximum sentence of 20 years in prison.  

DEBO, 50, is charged with one count of conspiracy to commit securities fraud, which carries a maximum sentence of five years in prison; two counts of securities fraud, each of which carries a maximum sentence of 20 years in prison; one count of conspiracy to commit wire fraud, which carries a maximum sentence of 20 years in prison; and wire fraud, which carries a maximum sentence of 20 years in prison.

The statutory maximum sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by a judge. 

Mr. Berman praised the investigative work of the FBI, and thanked authorities in the United Kingdom, the Justice Department’s Office of International Affairs of the Department’s Criminal Division, and the Securities and Exchange Commission, which initiated civil proceedings against CIAPALA, BLACKLIGHT, DEBO, and others, for their assistance. 

This case is being handled by the Office’s Securities and Commodities Fraud Task Force and Complex Frauds and Cybercrime Unit.  Assistant United States Attorneys Noah Solowiejczyk and Vladislav Vainberg are in charge of the prosecution.

The allegations in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

          CONCORD - Ahmad Khawaja, 22, of Deerfield, was sentenced to 30 months in prison for importation of a controlled substance, United States Attorney Scott W. Murray announced today.  

          According to court documents and statements made in court, on or about May 29, 2018, Khawaja, using the internet, purchased approximately two pounds of MDMA (“Ecstasy”) from a supplier located in France.  Postal Inspectors intercepted the packages and confirmed they contained the drug MDMA.  Khawaja was arrested in Concord on June 1, 2018, when he picked up the packages from a person who had agreed to receive them for him.

          Khawaja previously pleaded guilty on May 2, 2019.

          “International trafficking activities bring dangerous drugs into New Hampshire,” said U.S. Attorney Murray.  “Those who use the internet or the mails to distribute illegal drugs should be aware that federal law enforcement will closely scrutinize their activities. We continue to work with our law enforcement partners each day to protect the citizens of the Granite State from criminals who import dangerous drugs.”

          This matter was investigated by the United States Postal Inspection Service and Immigration and Customs Enforcement’s Homeland Security Investigations.  The case was prosecuted by Assistant U.S. Attorney John S. Davis.           

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          CONCORD – Justin English, 35, of Effingham, was sentenced to 84 months in federal prison for participating in a fentanyl trafficking conspiracy and possessing firearms in furtherance of his drug trafficking, United States Attorney Scott W. Murray announced today. 

          According to court documents and statements made in court, between early 2018 and October 4, 2018, the Federal Bureau of Investigation’s Southern Maine Safe Streets Gang Task Force conducted an investigation into English’s fentanyl trafficking in Effingham and York, Maine.  On October 4, 2018, the FBI executed a search warrant on English’s residence, arrested English, and seized approximately 200 grams of fentanyl, currency, collectible coins, and four firearms.  English also forfeited $28,386 in cash and $45,738 in collectible coins to the United States. The FBI previously administratively forfeited the firearms.

          English previously pleaded guilty on September 19, 2019.

          “Removing armed fentanyl dealers from society makes the Granite State a safer place,” said U.S. Attorney Murray. “Fentanyl is a deadly drug that endangers the general public. The risk is compounded when the drug dealer is armed. In order to maintain public safety, we will make every effort to obtain substantial prison sentences for armed drug dealers.”

          "It is a rewarding day for the FBI when a dangerously armed drug pusher like Justin English and the fentanyl he was trafficking from his home are taken off the street," said Joseph R. Bonavolonta, Special Agent in Charge of the FBI Boston Division. "The town of Effingham, and law enforcement, are surely safer without him around, considering our agents located a loaded UZI pistol, two 12-gauge shotguns, and a partially loaded assault-style rifle while searching his residence. He'll now pay the price for making the link we too often see between drugs and guns." 

          This matter was investigated by the Federal Bureau of Investigation’s Southern Maine Safe Streets Gang Task Force, the York, Maine County’s Sheriff’s Office, the Effingham, New Hampshire Police Department and the New Hampshire Attorney General’s Drug Task Force.  The case was prosecuted by Assistant U.S. Attorney Jennifer Davis.           

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ERIE, Pa. - An inmate at the Allenwood United States Penitentiary in Allenwood, Pennsylvania pleaded guilty in federal court to a charge of infliction of bodily injury, United States Attorney Scott W. Brady announced today.

Lawrence W. Nelson, 44, pleaded guilty to one count before United States District Judge David S. Cercone.

In connection with the guilty plea, the court was advised that on or about July 10, 2019, Nelson assaulted a staff member while an inmate at the McKean Federal Correctional Institution. The staff member suffered a broken nose, black eye and concussion as a result of the assault.

Judge Cercone scheduled sentencing for May 28, 2020 at 12:45 p.m. The law provides for a total sentence of 20 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.

Assistant United States Attorney Paul S. Sellers is prosecuting this case on behalf of the government.

Officers of the McKean Federal Correctional Institution and the Federal Bureau of Investigation conducted the investigation that led to the prosecution of Nelson.

ERIE, Pa. - A former resident of Meadville, Pennsylvania, has been sentenced in federal court to 96 months in jail and 8 years supervised release on his conviction of violating federal laws relating to the sexual exploitation of children, United States Attorney Scott W. Brady announced today.

United States District Judge David S. Cercone imposed the sentence on Dennis Michael Kerr, 29.

According to information presented to the court, Kerr transported computer images and movies depicting minors engaging in sexually explicit conduct. Kerr also transferred and attempted to transfer obscene material to an individual Kerr thought was a minor.

This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the 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 locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.

Assistant United States Attorney Christian A. Trabold prosecuted this case on behalf of the government.

United States Attorney Brady commended the Federal Bureau of Investigation and the Pennsylvania State Police for the investigation leading to the successful prosecution of Kerr.

KANSAS CITY, Mo. – A St. Joseph, Missouri, man was sentenced in federal court today for his role in a conspiracy to distribute nearly $6 million of synthetic cannabinoid products, also known as K2.

Shakeel Khan, 42, was sentenced by U.S. District Judge Roseann Ketchmark to three years in federal prison without parole. The court also ordered Khan to forfeit to the government $2,005,239 that was seized by law enforcement during the investigation and to pay a money judgment of $4,750,000, which accounts for all K2-related deposits associated with his bank accounts.

Co-defendants Mohammed Saleem, 46, of Diamond Back, California, and Asif Saddiq, 61, of Fullerton, California, each were sentenced in December 2019 to four years in federal prison without parole. The court also ordered both Saleem and Saddiq to pay a money judgment for which they are jointly and severally liable with Khan.

Khan, Saleem, and Saddiq each pleaded guilty to participating in a conspiracy to distribute misbranded drugs across state lines from March 1, 2011, to April 30, 2014. They also each pleaded guilty to participating in a money-laundering conspiracy that involved payments totaling nearly $500,000 to bank accounts in Pakistan.

Khan, Saleem, and Saddiq admitted that they distributed synthetic cannabinoid products, a controlled substance analogue. The synthetic cannabinoid products had false and misleading labeling in that they were labeled in a manner indicating they were not fit for human consumption when, in fact, the synthetic marijuana products were intended for human consumption. This labeling caused the synthetic marijuana products to be misbranded in violation of federal law.

Saleem began producing synthetic cannabinoids in Kansas City, Missouri, in 2009, where he met Khan. Saleem’s company was MNZ WHOLESALE AND DISTRIBUTION. The following year Saleem moved to Texas to continue producing synthetic cannabinoids, while Khan continued to assist him with his operation in Kansas City. Saleem met Siddiq at a trade show in Las Vegas, Nevada, in 2011, after which he moved his operation to Los Angeles, California, and partnered with him. They ran a company called S&S Memon, Inc., DBA LA BLAZE. An affiliated company of LA BLAZE was S&S MEMON DBA LAWORLD SPICE. Another affiliated company was called LA PARADISE and MNZ WORLD SPICE. They were producing synthetic cannabinoids and during this time were producing 50,000 bags of K-2 six days a week.

In the fall of 2011, Khan traveled to Los Angeles to operate a K-2 business and opened K BROTHERS IMPORTS, INC. Saleem then put his business MNZ WHOLESALE AND DISTRIBUTION in Khan’s name.

Saleem travelled to China to purchase the chemicals needed to produce the synthetic cannabinoids. Court documents cite 16 wire transfers, totaling $1,725,250, to purchase chemicals from individuals in China from November 2011 to March 2012. Some of the chemicals that were used in the production of synthetic cannabinoid products constituted analogues to banned chemicals and were thus illegal to distribute or sell by the defendants. 

This case is being prosecuted by Assistant U.S. Attorney Joseph M. Marquez. It was investigated by the Drug Enforcement Administration and IRS-Criminal Investigation.

ERIE, Pa. - A resident of Fairview, Pennsylvania, has been sentenced in federal court to 22 months in jail and ordered to pay $200,000 in restitution on her conviction of wire fraud, United States Attorney Scott W. Brady announced today.

United States District Judge David S. Cercone imposed the sentence on Elizabeth McMahan, 51. 

According to information presented to the court, McMahan was a commission sales employee at National Tool Grinding in Erie. From June 2010 to August 2014, she was selling products for a thirty to ninety percent discount without authorization from her employer, which resulted in greater commissions for her. In addition, McMahan falsified commission reports by submitting false sales that never occurred and increasing purchase prices.

Assistant United States Attorney Christian A. Trabold prosecuted this case on behalf of the government.

United States Attorney Brady commended the Federal Bureau of Investigation and the Erie Police Department for the investigation leading to the successful prosecution of McMahan.

Assistant U.S. Attorney Joseph P. Price, Jr. (619) 546-7642

NEWS RELEASE SUMMARY– January 2, 2020

SAN DIEGO – David Smith and Fane Robinson, two San Diego-area physicians, have paid the United States $948,768.18 to resolve allegations that they violated the federal False Claims Act by knowingly submitting false claims to Medicare.

Dr. Smith and Dr. Robinson are medical doctors specializing in ophthalmology.  They maintain a medical practice in San Diego known as San Diego Retina Associates and are participating providers in federally-funded health care programs including Medicare.

The United States alleged that Drs. Smith and Robinson violated the False Claims Act by submitting false claims to Medicare for care that was provided by a San Diego Retina Associates physician who was not properly credentialed at the time to render care to Medicare patients.

The United States also alleged that Drs. Smith and Robinson improperly received Medicare payments when another San Diego Retina Associates physician provided care to Medicare patients but Drs. Smith and Robinson submitted claims that misidentified the treating physician.

The settlement concludes a lawsuit originally filed in the United States District Court for the Southern District of California by Atul Jain, M.D., an ophthalmologist and former partner at San Diego Retina Associates. Dr. Jain sued under the qui tam, or whistleblower, provisions of the False Claims Act, which permits a private citizen to initiate a lawsuit on behalf of the United States for false claims and to share in the recovery.  Dr. Jain will receive $170,778.27 of the proceeds from the United States’ settlement with Drs. Smith and Robinson.

“Falsely billing in order to circumvent Medicare’s oversight of physicians negatively impacts taxpayers and puts at risk patients’ health,” said U.S. Attorney Robert Brewer. “This settlement reflects our commitment to maintain the integrity of the Medicare program. As this settlement also reflects, we continue to vigorously investigate cases brought to our attention by whistleblowers.  We commend the whistleblower in this case, Dr. Jain, for coming forward and for working with investigators.”

“Federal health care beneficiaries can clearly see federal health programs’ need to pay only for the services of properly credentialed eye doctors and other medical professionals. To do otherwise could harm both patients and taxpayers,” said Timothy B. DeFrancesca, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services.  “We will continue working closely with our law enforcement partners to protect government healthcare programs and enrolled beneficiaries.”   

The investigation was conducted by the U.S. Attorney’s Office for the Southern District of California and the U.S. Department of Health and Human Services’ Office of Inspector General.   This case is captioned United States, et al. ex rel. Jain v. Dr. David Smith, M.D., Arch Health Partners, Inc., et al., Case No. 18-cv-1213-AJB (WVG), and the matter was handled by Assistant U.S. Attorney Joseph P. Price, Jr. of the Affirmative Civil Enforcement Unit of the U.S. Attorney’s Office. U.S. Attorney Brewer commended the prosecutors and investigators for working hard to bring the case to a successful conclusion.

FRESNO, Calif. — A federal grand jury returned a one-count indictment today against Mario Alberto Rangel, 28, of Fresno, charging him with unlawfully possessing a firearm after being convicted of a felony crime, U.S. Attorney McGregor W. Scott announced.

According to court documents, on Oct. 22, 2019, law enforcement officers attempted to stop Rangel for a traffic violation, but he failed to yield and fled in the vehicle at a high rate of speed. Out of concern for public safety, the officers ceased their pursuit but continued to drive in the direction that the vehicle had last been seen. Moments later, officers came upon a multiple vehicle collision involving Rangel’s vehicle. Rangel had exited his car and fled on foot but was eventually arrested. A loaded shotgun was found in the back seat of the vehicle that Rangel abandoned. Rangel is prohibited from possessing firearms because of his prior criminal record.

This case is the product of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Fresno Police Department. Assistant U.S. Attorney Justin J. Gilio is prosecuting the case.

If convicted, Rangel faces a maximum statutory penalty of 10 years in prison and a $250,000 fine. Any sentence, however, would 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. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

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. To learn more about Project Safe Neighborhoods, go to www.justice.gov/psn.

This case is also part of Project Guardian, the Department of Justice’s signature initiative to reduce gun violence and enforce federal firearms laws.  Initiated by the Attorney General in the fall of 2019, Project Guardian draws upon the Department’s past successful programs to reduce gun violence; enhances coordination of federal, state, local, and tribal authorities in investigating and prosecuting gun crimes; improves information-sharing by the Bureau of Alcohol, Tobacco, Firearms and Explosives when a prohibited individual attempts to purchase a firearm and is denied by the National Instant Criminal Background Check System (NICS), to include taking appropriate actions when a prospective purchaser is denied by the NICS for mental health reasons; and ensures that federal resources are directed at the criminals posing the greatest threat to our communities. For more information about Project Guardian, please see https://www.justice.gov.

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FRESNO, Calif. — A federal grand jury returned a 10-count indictment today against two Fresno residents, U.S. Attorney McGregor W. Scott announced.

Felipe Barajas, 25, was charged with interfering with commerce by robbery, brandishing a firearm in the commission of a violent crime, felon in possession of a firearm and ammunition, and possession of an unregistered firearm. Brittney Manzo, 24, is charged with two counts of interference with commerce by robbery.

According to court documents, between Oct. 30 and Nov. 21, 2019, Barajas robbed at gunpoint three commercial establishments in Fresno, and attempted to take money from one other. On Nov. 21, Manzo drove the vehicle in which Felipe Barajas fled after two of the incidents. Manzo led police on a pursuit and ultimately both she and Felipe Barajas were apprehended after the vehicle crashed and both attempted to run away.

The stores where the armed robberies were committed/attempted are:
Oct. 30 — El Parian Grocery Market at 3804 E. Butler Ave., Fresno
Nov. 19 — Valley Gas & Mini Mart at 2139 S. Elm Ave., Fresno
Nov. 21 — Andres Liquor at 3953 N. Blackstone Ave., Fresno (attempted)
Nov. 21 — Star Smoke Shop at 453 N. Blackstone Ave., Fresno

This case is the product of an investigation by the Fresno Police Department with assistance from the Bureau of Alcohol, Tobacco and Firearms and Explosives. Assistant U.S. Attorney Stephanie Stokman is prosecuting the case.

If convicted, Barajas and Manzo face a maximum statutory penalty of 20 years in prison and a $250,000 fine. Any sentence, however, would 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. The charges are only allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.

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. To learn more about Project Safe Neighborhoods, go to www.justice.gov/psn.

This case is also part of Project Guardian, the Department of Justice’s signature initiative to reduce gun violence and enforce federal firearms laws.  Initiated by the Attorney General in the fall of 2019, Project Guardian draws upon the Department’s past successful programs to reduce gun violence; enhances coordination of federal, state, local, and tribal authorities in investigating and prosecuting gun crimes; improves information-sharing by the Bureau of Alcohol, Tobacco, Firearms and Explosives when a prohibited individual attempts to purchase a firearm and is denied by the National Instant Criminal Background Check System (NICS), to include taking appropriate actions when a prospective purchaser is denied by the NICS for mental health reasons; and ensures that federal resources are directed at the criminals posing the greatest threat to our communities. For more information about Project Guardian, please see https://www.justice.gov.

United States Attorney Ron Parsons announced that an Eagle Butte, South Dakota, woman has been indicted by a federal grand jury for Second Degree Burglary, Larceny, Assaulting Resisting, and Impeding a Federal Officer, Assault with a Dangerous Weapon, and Discharging a Firearm During and in Relation to a Crime of Violence.

Justin Twite, age 22, was indicted on April 9, 2019.  She appeared before U.S. Magistrate Judge Mark A. Moreno on December 30, 2019, and pled not guilty to the Indictment.

The maximum penalty upon conviction is up to life in federal prison and/or a $250,000 fine, 5 years of supervised release, and $100 to the Federal Crime Victims Fund.  Restitution may also be ordered.

The Indictment alleges that on December 21, 2018, Twite entered a residence in Eagle Butte where she stole a safe.  She also stole a pickup parked at the residence.  The Indictment further alleges that, on the same date, Twite did forcibly assault, resist, oppose, impede, intimidate, and interfere with multiple Cheyenne River Sioux Tribe Police Officers, and did assault one of the police officers with a firearm, with intent to do bodily harm to the officer.

The charges are merely accusations and Twite is presumed innocent until and unless proven guilty. 

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 is being conducted by the Cheyenne River Sioux Tribe Law Enforcement Services and the Bureau of Alcohol, Tobacco, Firearms, and Explosives.  Assistant U.S. Attorney Jay Miller is prosecuting the case.   

Twite was remanded to the custody of the U.S. Marshals Service pending trial.  A trial date has not been set.

United States Attorney Ron Parsons announced that a Rosebud, South Dakota, man convicted of Felon in Possession of a Firearm was sentenced on January 2, 2020, by U.S. District Judge Roberto A. Lange.

Alvin Running Horse, Jr., age 41, was sentenced to 9 months in federal prison, followed by 3 years of supervised release, and a special assessment to the Federal Crime Victims Fund in the amount of $100.

Running Horse was indicted by a federal grand jury on July 26, 2019.  He pled guilty on September 25, 2019.

The conviction stemmed from an incident that occurred on April 23, 2019.  On that date, Running Horse got into a confrontation with his wife at his residence in Rosebud.  Rosebud Sioux Tribe Law Enforcement Services (RSTLES) officers responded to a call for service at the residence. Running Horse’s wife reported that Running Horse left with a firearm.  Running Horse was subsequently stopped by RSTLES officers and the firearm was found in his possession.

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 its 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 local communities to develop effective, locally-based strategies to reduce violent crime.

This case was investigated by the Rosebud Sioux Tribe Law Enforcement Services and the Bureau of Alcohol, Tobacco, Firearms, and Explosives. Assistant U.S. Attorney Kirk Albertson prosecuted the case.

Running Horse was immediately turned over to the custody of the U.S. Marshals Service.

United States Attorney Ron Parsons announced that a Sioux Falls, South Dakota, man convicted of one count of distribution of a controlled substance resulting in serious bodily injury and one count of conspiracy to distribute a controlled substance was sentenced on December 30, 2019, by U.S. District Judge Karen E. Schreier.

Michael Wayne Cooper, age 58, was sentenced to 240 months of federal imprisonment on each count, to be served concurrently, and 3 years of supervised release on each count, to be served concurrently.  He was also ordered to pay $200 to the Federal Crime Victims Fund.

According to the court documents, Cooper knowingly and intentionally distributed a controlled substance, namely fentanyl, resulting in the serious bodily injury of a victim in Sioux Falls, who overdosed on the fentanyl sold to him.  The overdose victim was revived by first responders with two doses of Naloxone, commonly known as Narcan, which prevented his death.

The evidence at trial further demonstrated that Cooper had been involved in an ongoing conspiracy in Sioux Falls to illegally distribute hydromorphone (commonly known as Dilaudid), a Schedule II controlled substance, from about the beginning of 2015 through August 2018.

This case was investigated by the Drug Enforcement Administration, Sioux Falls Police Department, and the Sioux Falls Area Drug Task Force. Special Assistant U.S. Attorney Tamara Nash prosecuted the case.

Cooper was immediately turned over to the custody of the U.S. Marshals Service.

Criminal charges have been filed against multiple Mongolian Boys Society gang members in both the Fresno County Superior Court and in the United States District Court related to the murders of four (4) victims and the attempted murders of twelve (12) victims at a Sunday Night football watch party on the evening of November 17, 2019, the Fresno County District Attorney’s Office and the United States Attorney’s Office have announced.

The Federal Felony Complaint filed in U.S. District Court today alleges that Fresno residents Pao Vang, 30; Jhovanny Delgado, 19; and Johnny Xiong, 25, conspired to commit murder in aid of racketeering, in violation of Title 18, United States Code, Section 1959(a)(5).

According to the criminal complaint, on Nov. 17, 2019, members and associates of the Mongolian Boys Society conspired to commit murder. At a meeting, the defendants and others selected a target residence, chose shooters, provided them with guns, and drove to the target location. Vang, Delgado, and Xiong attended the meeting outlining the planned retaliation and understood that the objective was to murder individuals at the designated target residence. They were designated as lookouts and positioned themselves on street corners near the target residence to report the presence of law enforcement.

The partnership of federal agencies with local law enforcement is critical in the fight against violent crime. Federal agencies investigating this case are the Federal Bureau of Investigation, the Bureau of Alcohol, Tobacco, Firearms and Explosives, Homeland Security Investigations, and the U.S. Marshals Service.

If convicted, the defendants face a maximum statutory penalty of 10 years in prison and a fine of up to $250,000. Any sentence, however, would be determined at the discretion of the court.

The Felony Complaint filed in Superior Court alleges that Ger Lee (27, of Fresno), Anthony Montes (27, of Fresno), Porge Kue (26, of Fresno), and Billy Xiong (25, of Fresno) committed the crimes of:

1. Four Counts of Murder [P.C. § 187(a)];
2. One Count of Conspiracy to Commit Murder [P.C. § 182/187(a)]; and
3. Twelve Counts of Attempted Murder [P.C. § 664/187(a)].

The murder charges also include two (2) special circumstances as to the four named defendants pursuant to Penal Code section 190.2 that allege:

            1.)  The defendants committed multiple murders [P.C. § 190.2(a)(3)]; and

            2.)  The murders were committed for the benefit of a criminal street gang [P.C. § 190.2(a)(22)].

That Complaint also contains the additional allegations that the four named defendants committed the crimes for the benefit of, at the direction of, or in association with a criminal street gang [P.C. § 186.22(b)], that they personally and intentionally discharged a firearm that caused great bodily injury or death [P.C. § 12022.53(d)], and that they personally and intentionally discharged a firearm [P.C. § 12022.53(c)].

If convicted of these charges in State Court, these defendants face a sentence of either Death or Life in Prison.  The District Attorney’s Office is currently conducting a necessary investigation, and will make a determination and announcement regarding the death penalty at a later date.

The Media may email FCDAMedia@fresnocountyca.gov with questions.

The charges are allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.

OKLAHOMA CITY – DESMA VALDEZ, 19, of Lincoln County, has been arrested for arson in connection with a house fire in Indian country, announced U.S. Attorney Timothy J. Downing.

According to an affidavit in support of a criminal complaint filed on December 31, 2019, Valdez deliberately set fire to a trailer home on tribal land of the Kickapoo Tribe of Oklahoma.  The affidavit alleges that Valdez was staying in the trailer home with two individuals whose burned bodies were found inside.  An investigation into the cause of death is underway.  The case is charged in federal court because the alleged crime took place in Indian country and Valdez is an Indian.

Valdez was injured as a result of the fire and was transported to a local hospital.  She was arrested upon her release from the hospital on January 1 and made her initial appearance today before U.S. Magistrate Judge Gary M. Purcell.

If found guilty, Valdez faces a maximum potential penalty of life in prison, five years of supervised release, a fine of $250,000, and mandatory restitution.

This case is a result of an investigation by the Federal Bureau of Investigation—Oklahoma City Division; the Kickapoo Tribal Police Department; the Bureau of Alcohol, Tobacco, Firearms, and Explosives; and the Bureau of Indian Affairs.  Assistant U.S. Attorneys Mark Stoneman and Thomas B. Snyder are prosecuting the case.

The public is reminded that this charge is merely an allegation and that Valdez is presumed innocent unless and until proven guilty beyond a reasonable doubt.  Reference is made to public filings for more information.  To download a photo of U.S. Attorney Downing, click here.