PHOENIX, Ariz. – The United States Attorney’s Office unsealed three criminal complaints filed in Federal District Court charging multiple individuals with health care fraud associated with the COVID-19 pandemic. 

“Now more than ever, the integrity of our healthcare system is paramount as we fight a global pandemic,” said United States Attorney Michael Bailey. “We remain committed to rooting out and prosecuting any individual who would use this crisis as an opportunity to defraud individuals or the government.”

One complaint charges Jeremiah Faber, 45, of Gold Canyon, Arizona, the CEO of Harmony Healthcare, LLC dba Harmony Medical Care, with one count of health care fraud and one count of money laundering. The complaint alleges that Faber used Harmony’s Facebook and other social media sources to offer free COVID-19 testing if patients also completed Harmony’s Comprehensive Whole-Body Assessment. Harmony then fraudulently submitted claims for reimbursement to Mercy Care, Arizona’s health care benefit program, by billing for services that were medically unnecessary and for services provided in the names of physicians who had no role in the assessment.

Two other complaints charge a total of six individuals associated with five Phoenix-area businesses that purport to provide non-emergency medical transportation services on the Navajo Nation. The first complaint charges Abdul Raheem Abdul Jabbar, Nohad Loabneh, and Abedelhalim Lawabni with conspiring to commit health care fraud. The complaint alleges that Abdul Jabbar, Loabneh, and Lawabni falsely billed Arizona’s Health Care Cost Containment System (AHCCCS) for more than 9,000 non-emergency medical transports in April 2020 when those transports never occurred. After the Arizona Governor and the President of the Navajo Nation both declared COVID-19 public emergencies, the need for non-emergency medical transports dramatically decreased. The complaint further alleges that their false billings in April 2020 generated a total of more than $2.75 million in fraudulent payments from AHCCCS to the three businesses. AHCCCS is Arizona’s Medicaid agency, offering health care programs to low-income Arizona residents. Loabneh, and Lawabni own and operate A&N Services, LLC. Abdul Jabbar owns and operates Freedom AZ, LLC, and is also affiliated with Desert Mobile, LLC.

The second complaint charges Miguel Denga, Husam Alsadi, and Tamarria Denga with conspiring to commit health care fraud. The complaint alleges that Alsadi and the Dengas falsely billed AHCCCS for more than 1,500 non-emergency medical transports in April 2020 when those transports never occurred. As noted above, after the Governor of Arizona and the President of the Navajo Nation both declared COVID-19 public emergencies, the need for non-emergency medical transports dramatically decreased. The complaint further alleges that their false billings in April 2020 generated a total of more than $450,000 in fraudulent payments from AHCCCS to the two businesses. Miguel Denga and Alsadi own and operate Philia Homecare, LLC. Tamarria Denga owns and operates COS 1, LLC.

“Fraudsters are using the uncertainty around COVID-19 to line their pockets,” said Sean Kaul, Special Agent in Charge of the FBI Phoenix Field Office. “Thanks to the diligent work of Arizona’s COVID-19 Fraud Task Force, the FBI identified and dismantled fraud rings in Arizona which were trying to exploit the COVID-19 pandemic. Make no mistake, the FBI will actively pursue those seeking to fraudulently profit from the pandemic. The FBI thanks the U.S. Department of Health and Human Services Office of the Inspector General (HHS-OIG), and the Arizona Health Care Cost Containment System Office of the Inspector General (AHCCCS-OIG) for their partnerships and collaboration on these cases. Their work was vital to these investigations.”

Jeremiah Faber is scheduled to make his initial appearance in court on June 30, 2020. The other six defendants are scheduled to make their initial appearances in court on June 11, 2020.   

A complaint is simply the method by which a person is charged with criminal activity and raises no inference of guilt. Individuals are presumed innocent until proven guilty beyond a reasonable doubt.

RELEASE NUMBER:           2020-053_COVID Fraud

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For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az
Follow the U.S. Attorney’s Office, District of Arizona, on Twitter @USAO_AZ for the latest news.

MADISON, WIS. - Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that James Britton, 30, Madison, Wisconsin, was sentenced today by U.S. District Judge James D. Peterson to 37 months in federal prison for possessing heroin with intent to distribute.

This is Britton’s second sentence in federal court.  At the time of this offense, he was serving a term of federal supervision as a result of his 2015 conviction for distributing heroin. Judge Peterson revoked the defendant’s supervision and imposed an additional term of imprisonment of one year and one day, to be served consecutively to the 37-month term.

The total amount of heroin attributable to Britton was approximately 37.51 grams. Three additional counts of distribution of heroin were dismissed pursuant to the defendant’s plea.

In sentencing the defendant, Judge Peterson noted that Britton was “damaging the community” by selling heroin and that his conduct took advantage of others’ addictions. Judge Peterson explained that the sentence was meant to provide incremental punishment based on the defendant’s prior conviction and subsequent failure on supervision. 

The charge against Britton was the result of an investigation conducted by the Drug Enforcement Administration.  Assistant U.S. Attorney Taylor L. Kraus handled the prosecution.

WASHINGTON – Williams Brothers Construction Inc. (WBCI) of Peoria Heights, Illinois, has agreed to pay $1 million to resolve allegations that it violated the False Claims Act by misrepresenting its use of a small disadvantaged business to obtain a federally-funded construction contract, the Department of Justice announced today.

“The Disadvantaged Business Enterprise (DBE) Program of the Department of Transportation creates important opportunities for small businesses to participate in construction projects paid for with federal funds,” said Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division.  “We will hold accountable those who misrepresent their compliance with program requirements to obtain taxpayer funds to which they are not entitled, and thereby undermine the program’s goal of supporting small businesses.”

The settlement resolves claims arising from WBCI’s construction of a new terminal building at the Peoria International Airport using Federal Aviation Administration (FAA) grant funds.  The FAA grant required the use of disadvantaged business enterprises for part of the construction.  The United States contends that WBCI knowingly made false representations regarding its plans to use a disadvantaged small firm on the project and then falsified documents to make it appear that an eligible business did window, glazing, and curtain wall work.  Instead, WBCI allegedly used that business only as a pass-through and had the work done by an ineligible company.

“The U.S. Attorney’s Office will continue to protect taxpayer dollars,” said U.S. Attorney John C. Milhiser for the Central District of Illinois.  “In cases such as this, we work alongside the Civil Division at the Department of Justice and with the Department of Transportation’s Office of Inspector General to ensure that funds designated to support disadvantaged small businesses are used for their intended purpose and benefit.”

“The settlement reached today is a step on the way to closing the chapter on this egregious fraud scheme involving a federally funded construction project at Peoria International Airport,” said Andrea M. Kropf, Regional Special Agent-in-Charge of the Department of Transportation Office of Inspector General (DOT OIG).  “While the damage to the integrity of DOT’s DBE program in this instance cannot be undone, it only serves to strengthen our resolve in pursuing those whose actions prevent the legitimate participation of disadvantaged businesses in federal contracting on transportation projects.”

The settlement was the result of a coordinated effort by the Civil Division, the U.S. Attorney’s Office for the Central District of Illinois, and DOT OIG.  To learn more about the Civil Division, please visit https://www.justice.gov/civil.  To learn more about the U.S. Attorney’s Office for Central District of Illinois, please visit https://www.justice.gov/usao-cdil.

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

The year 2020 marks the 150th anniversary of the Department of Justice.  Learn more about the history of our agency at www.Justice.gov/Celebrating150Years

TOPEKA, KAN.– Harcros Chemicals, Inc., and MGP Ingredients, Inc., today were fined $1 million each for violating the federal Clean Air Act when a cloud of toxic chlorine gas was released over Atchison, Kan., in 2016, U.S. Attorney Stephen McAllister said. Both companies have paid the fines.

U.S. District Court Judge Daniel Crabtree sentenced the companies during a hearing in federal court in Topeka today. Both companies pleaded guilty to negligently violating the Clean Air Act, which is a Class A misdemeanor.

In their pleas, they admitted that on Oct. 21, 2016, a greenish-yellow chlorine gas cloud formed at MGP Ingredients’ facility in Atchison when 4,000 gallons of sulfuric acid were mistakenly combined with 5,800 gallons of sodium hypochlorite. The Atchison County Department of Emergency Management ordered community members to shelter in place and to evacuate in some areas. Approximately 140 individuals including members of the public, first responders, employees of MGP Ingredients and Harcos Chemicals sought medical attention.

“The chemicals involved in this case posed serious public health and environmental dangers,” said Assistant Special Agent in Charge Cate Holston of EPA’s Criminal Investigation Division in Kansas.  “EPA and its law enforcement partners are committed to holding responsible parties accountable for actions that put an entire community at risk.”

McAllister commended the Environmental Protection Agency and Assistant U.S. Attorney Rich Hathaway for their work on the case.

BOSTON – A member of the New Bedford Chapter of the Almighty Latin King and Queen Nation was charged yesterday with being a felon in possession of a firearm as a result of a federal investigation into a shooting on April 19, 2020, in New Bedford.

Alexander Pizarro, a/k/a “King Tego,” 28, was charged yesterday in a criminal complaint with one count of being a felon in possession of a firearm. Pizarro, who is currently in custody in Rhode Island, will make his initial appearance in federal court at a later date.

According to the charging documents, on April 19, 2020, police responded to a report of seven shots fired near a residence on Clark Street in New Bedford. During the response, police located a tan and black Taurus 9mm firearm in an alleyway near the residence. Based on information received from a 911 caller, police were directed to an apartment and located Pizarro, who was known to be a member of the Latin Kings. After searching his cell phone, investigators located a photograph of Pizarro in the apartment holding what appears to be the same firearm that was recovered from Clark Street. This photograph was allegedly taken approximately two hours before the shots-fired incident. Through ballistics comparison, the seized firearm was matched to the recovered shell casings from the shooting that evening.             

Due to multiple prior convictions, Pizarro is prohibited from possessing firearms. According to court documents, Pizarro was known to investigators to be a member of the New Bedford Chapter of the Latin Kings, and had recently posted multiple pictures holding firearms to his SnapChat account. At the time of the shooting incident, Pizarro was on probation for a 2017 firearms case in Rhode Island.

The charge of being a felon in possession of a firearm provides for a sentence of up to 10 years in prison, up to three years of supervised release and a fine of up to $250,000. Sentences are imposed by a federal district court judge based on the U.S. Sentencing Guidelines and other statutory factors.

United States Attorney Andrew E. Lelling; Kelly D. Brady, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives, New England Field Division; and New Bedford Police Chief Joseph C. Cordeiro made the announcement today. Assistant U.S. Attorney Philip A. Mallard of Lelling’s Organized Crime and Gang Unit 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. Former Attorney General Jeff Sessions 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 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.

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

ROCHESTER, N.Y. -- U.S. Attorney James P. Kennedy, Jr. announced today that Joseph Thompson, 39, and his brother, Jonathan Thompson, 41, both of the Akwesasne Mohawk Indian Reservation, pleaded guilty before U.S. District Judge Charles J. Siragusa, to wire fraud. The charge carries a maximum penalty of 20 years in prison and a $250,000 fine.

Assistant U.S. Attorney Melissa Marangola, who is handling the case, stated that the defendants worked with others to acquire “cut rag tobacco” which would be used to manufacture contraband cigarettes. Monies to purchase the cut rag tobacco were wired from Rochester, NY to CanStar International Inc., a tobacco broker, in the state of Florida. Once purchased, the cut rag tobacco was delivered to buildings and warehouses controlled by the defendants in Awkwasasne, NY. The defendants then used the cut rag tobacco to manufacture unlicensed cigarettes and distribute the cigarettes to various Indian Reservations in the United States.

Between June 2016 and December 2018, the defendants ordered approximately 72,500 pounds of cut rag tobacco from CanStar, which was used to manufacture approximately 27,923,077 unlicensed cigarettes. This resulted in a loss to the United States of approximately $1,405,368.46 in federal taxes.  

The pleas are the culmination of an investigation by the Internal Revenue Service, Criminal Investigation Division, under the direction of Jonathan D. Larsen, Special Agent-in-Charge; Homeland Security Investigations - Border Enforcement Security Team, under the direction of Special Agent-in-Charge Kevin Kelly; Customs and Border Protection Air and Marine Unit, under the direction of Director Brian Manaher; the Alcohol and Tobacco Tax and Trade Bureau – Office of Field Operations, under the direction of Assistant Administrator Nicholas Colucci; and the Bureau of Alcohol, Tobacco, Firearms, and Explosives, under the direction of Special Agent-in-Charge John B. Devito, New York Field Division.

Sentencing is scheduled for August 27, 2020, before Judge Siragusa.

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A man who distributed child pornography was sentenced May 26, 2020, to more than 7 years in federal prison.

Diego Felipe Juan, age 46, originally from Guatemala and living in Doon, Iowa, received the prison term after a December 2, 2019, guilty plea to one count of distribution of child pornography.

In a plea agreement, Juan admitted that between November of 2018 and January 18, 2019, using the internet, he knowingly distributed a visual depiction of a minor engaged in sexually explicit conduct to another person. It was revealed at the sentencing hearing that Juan had other videos of child pornography on his cell phone.

Juan was sentenced in Sioux City by United States District Court Chief Judge Leonard T. Strand.  Juan was sentenced to 87 months’ imprisonment.  He must also serve a 5-year term of supervised release after the prison term.  There is no parole in the federal system.

Juan is being held in the United States Marshal’s custody until he can be transported to a federal prison.

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, 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.usdoj.gov/psc.  For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab “resources

The case was prosecuted by Assistant United States Attorneys Ron Timmons and Timothy Duax and investigated by the Iowa Division of Criminal Investigation, the Iowa Internet Crimes Against Children Task Force, the FBI Child Exploitation Task Force, Homeland Security Investigations, and the Lyon County Sheriff’s Office.

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

The case file number is 19-CR-4032.

Follow us on Twitter @USAO_NDIA.

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

BUFFALO, N.Y.-U.S. Attorney James P. Kennedy, Jr. announced today that Rejjie Ni, 24, of Shanghai, China, pleaded guilty before U.S. District Judge Lawrence J. Vilardo to possession of a machine gun. The charge carries carry a maximum penalty of 10 years in prison, and a $250.000 fine. 

Assistant U.S. Attorney Jeremiah E. Lenihan, who is handling the case, stated that on March 18, 2019, the Amherst Police Department responded to the defendant’s apartment following a report that there were a large number of firearms inside the residence. During the execution of a search warrant, officers recovered 33 rifles, two shotguns, and numerous rounds of ammunition, including armor piercing bullets.

One of the rifles recovered was a semi-automatic rifle under Ni’s bed. Subsequent investigation and expert analysis determined that the defendant had converted the semi-automatic rifle into a fully automatic machinegun.

The plea is the result of an investigation by the Bureau of Alcohol, Tobacco, Firearms, and Explosives, under the direction of Special Agent-in-Charge John B. Devito, New York Field Division, the Amherst Police Department, under the direction of Chief John Askey, and Homeland Security Investigations, under the direction of Special Agent-in-Charge Kevin Kelly.

Sentencing is scheduled for October 5, 2020, before Judge Vilardo.

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SAN FRANCISCO – Mihran Stepanyan, Artur Stepanyan, Yan German, and Khachig Geuydjian pleaded guilty today to crimes stemming from their respective roles in a wide-ranging racketeering conspiracy involving diversion of prescription drugs, money laundering, bank fraud, identity theft, and additional crimes, announced United States Attorney David L. Anderson; Federal Bureau of Investigation Special Agent in Charge John F. Bennett; and Internal Revenue Service, Criminal Investigation, Special Agent in Charge Kareem Carter.  The pleas were accepted by the Hon. Charles R. Breyer, United States District Judge, and leaves one remaining defendant to stand trial for allegations made in a Second Superseding Indictment filed in February of 2016 against 38 defendants. 

“Patients needing prescription drugs shouldn’t have to worry that their medications came out of a back alley,” said U.S. Attorney Anderson.  “The defendants and their co-conspirators were able to make massive profits by diverting street drugs back into mainstream channels while creating false paperwork to conceal their true source.  Thanks to the FBI, IRS, and federal prosecutors in San Francisco, the defendants now face the prospect of lengthy prison sentences for their criminal conduct.”

“The American public was victimized twice by this scheme,” said FBI San Francisco Special Agent in Charge John F. Bennett. “The majority of the profits were subsidized both by American taxpayers and by those paying private insurance premiums.” “Additionally, patients were put at risk by the movement of these black market drugs, as the defendants disregarded general safety protocols and guidelines, to include expiration dates and pharmaceutical lot numbers.”

“Today’s guilty pleas bring us one step closer to closing the chapter on this criminal enterprise,” said Kareem Carter, Special Agent in Charge IRS Criminal Investigation. “The crimes committed by these defendants ranged from picking up drugs at a pizza shop to a half-million-dollar tax check fraud scheme.  In total, more than $199 million in diverted prescription drug proceeds were laundered through bank accounts established with false identities and shell companies.  IRS-CI is committed to following the money so we can financially disrupt and dismantle criminal organizations like these.”

All four defendants pleading guilty today—Mihran Stepanyan (M. Stepanyan), his cousin Artur Stepanyan (A. Stepanyan), German, and Geuydjian—have acknowledged that they were members of a nationwide conspiracy referred to in court documents as the Karapedyan-Stepanyan Enterprise (Enterprise).  One key aspect of the criminal activity was a multi-million dollar prescription drug diversion scheme.  According to the plea agreements filed today, members and associates of the Enterprise procured prescription drugs from unlicensed sources, usually street dealers, and resold the drugs to unknowing customers.  The Stepanyans also admitted that they are not licensed to sell drugs, that they procured millions of dollars of drugs through street suppliers and other unlicensed sources, and that the drugs they procured eventually were resold as legitimate products.

The Stepanyans’ plea agreements include an overview of the complexity and sophistication of the Enterprise’s operations.  Members of the Enterprise conducted the affairs of the organization through a pattern of racketeering and committed crimes throughout California as well as in Minnesota, Ohio, and Puerto Rico.  Further, the Stepanyans’ plea agreements describe how members and associates of the Enterprise procured and distributed a wide variety of drugs from unlicensed sources for distribution throughout the country.  The drugs included medications used to treat HIV infection, Type-2 diabetes, dementia, and high blood pressure, among other conditions.  Members and associates of the Enterprise also created false and fraudulent paperwork, referred to as pedigrees, to make it appear that those drugs had been purchased from legitimate sources.  In addition, they created sham companies and used multiple bank accounts to receive and distribute the proceeds from their fraudulent transactions.  The plea agreements also describe how the Stepanyans, along with other members and associates of the Enterprise, intentionally used the identities of real people to carry out their unlawful objectives.  The plea agreements of Geuydjian and German provide further details of the Enterprise’s operations.  Specifically, Geuydjian’s plea agreement describes how he negotiated fraudulent personal and tax checks for the benefit of the Enterprise, and German’s plea agreement describes how he supplied drugs for distribution by the Enterprise and managed aspects of the Enterprise’s money laundering operations. 

According to M. Stepanyan’s plea agreement, he became a member of the Enterprise as early as January 2010.  He admitted that he agreed with his co-conspirators to commit multiple criminal acts involving money laundering, mail fraud, wire fraud, bank fraud, identity theft, and multiple acts involving the distribution of drugs from unlicensed sources to conduct the affairs of the Enterprise.  In his plea agreement, M. Stepanyan admitted that he controlled several entities, including Red Rock Capital Group, Inc.; Trans Atlantic Capital Group, Inc.; GC National Wholesale, Inc.; and Sky Atlantic Group, Inc., in addition to numerous bank accounts through which approximately $199 million of pharmaceutical money flowed between 2010 and 2014.  M. Stepanyan also admitted purchasing approximately $56 million in gold using the illicit proceeds from the unlawful sale of prescription drugs.  As a further example of his participation in the Enterprise, M. Stepanyan used an entity called Niva Pharmaceuticals to facilitate transactions related to the criminal conspiracy.  Specifically, M. Stepanyan admitted that in January of 2014, he purchased Niva from a co-conspirator who had set up the company.  Although Niva was licensed to engage in drug wholesaling in California, it was not and did not engage in wholesale drug distribution.  Instead, M. Stepanyan acknowledged, Niva was nothing more than a shell company with offices that generally were empty except for a desk, a computer, and tables for drugs that the Enterprise procured.  The plea agreement describes how Enterprise members stored boxes of drugs in Niva’s offices and shipped them throughout the country using fraudulent labels that suggested the drugs were being shipped by or to authentic companies, including a legitimate drug company operating in Puerto Rico. 

A. Stepanyan also admitted in his plea agreement that he was a member of the Enterprise beginning in at least January of 2010.  Between 2010 and 2015, he directed and participated in a prescription drug diversion scheme whereby he procured drugs from various unlicensed sources and sold them to a co-defendant who, in turn, sold the drugs to pharmacies throughout the United States.  Further, A. Stepanyan admitted that the gross receipts for the sale of those diverted prescription drugs was at least $199 million.  According to the plea agreement, A. Stepanyan and his cousin, M. Stepanyan, laundered those proceeds through various bank accounts established in false identities, which M. Stepanyan controlled. 

German admitted in his plea agreement that he was a member of the Enterprise between 2013 and 2015.  He acknowledged that he was responsible for establishing a network of unlicensed street suppliers to provide drugs for the distribution scheme.  As described in his plea agreement, German had multiple sources of drugs.  Between 2013 and 2014, he obtained boxes full of prescription drugs from one of his co-conspirators in Los Angeles, California.  For example, he would pick up drugs from one of his sources at a pizza shop with the help of one of his associates, load the boxes into the trunk of a car, and drive them to a nearby mall or another pre-arranged location where he would deliver them to the Stepanyans.  German also admitted that in his role managing money-laundering operations for the Enterprise, he assisted with wire fraud, bank fraud, identity theft, and illegal check cashing schemes.  In the plea agreement, German admits that he used his birth name, Henrik Hartyunyan, during some of the underlying illegal conduct he performed on behalf of the Enterprise.

Geuydjian admitted that he was a member of the Enterprise from at least 2012 through approximately 2014.  In his plea agreement, he describes himself as a “money launderer for the Enterprise.”  Geuydjian acknowledged that he and others in the Enterprise created sham companies and used multiple bank accounts to receive and distribute the proceeds from the fraudulent transactions.  Geuydjian liquidated tax fraud and drug diversion proceeds by making deposits to a number of sham corporate entities that he created and allowed other members and associates of the Enterprise to use his businesses to send illicit funds and other merchandise.  Furthermore, Geuydjian used the identities of real people to carry out many of the Enterprise’s unlawful objectives.  For example, the plea agreement describes how Geuydjian’s co-conspirators acquired and possessed stolen identifying information for dozens of individuals in order to file fraudulent tax returns online.  The Enterprise obtained checks issued by the federal government and mailed from the United States Treasury based on fraudulent tax returns.  From approximately August 2012 through August 2013, Geuydjian fraudulently liquidated approximately 51 checks totaling more than $538,295 though accounts he held in the names of three companies he controlled.  Geuydjian also used photocopies of driver’s licenses, social security cards, or other personal identifying with the identities of real people to open bank accounts or gain access to the victims’ bank accounts, to negotiate checks made out in the victims’ names.  Furthermore, Geudjian and his co-conspirators perpetrated a tax check fraud scheme.  For example, in March 2014, Geudjian deposited two tax refund checks into fraudulent Wells Fargo bank accounts—one in the amount of $117,887 and another in the amount of $131,205.  These checks, which were from legitimate tax return filings, were stolen out of the mail by “runners” employed by members of the conspiracy.  Geudjian also liquidated approximately $71,806 that his co-conspirators stole from a victim’s Fidelity 401K retirement account.

On February 11, 2016, a federal grand jury handed down the Second Superseding Indictment charging the four defendants—as well as 34 additional individuals—with various crimes in connection with the activities of the Enterprise.  All four defendants pleading guilty today are released on bond pending sentencing.  A majority of the defendants in this case have pleaded guilty to various charges, including the following:

For those defendants who have not yet been sentenced, in addition to a term of imprisonment and fine, the court also may order additional periods of supervised release, restitution, and special assessments.  However, any sentence following conviction would be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.

A separate investigation resulted in another indictment filed on May 6, 2015 in the Southern District of Ohio charging M. Stepanyan, A. Stepanyan, and others with various crimes arising from their sale of millions of dollars of illicitly-procured drugs.  That matter was transferred to the Northern District of California and consolidated with the instant case.

Assistant United States Attorneys Claudia A. Quiroz, Andrew Dawson, and Chris Kaltsas are prosecuting the case with the assistance of Adrienne DelaPena and Kevin Costello.  The prosecution is the result of an investigation by the Federal Bureau of Investigation and the IRS.  

SHREVEPORT La. –United StatesAttorney David C. Joseph announced the resolution of several cases today, all of which are separately noted. The cases were brought as part of Project Safe Neighborhoods (PSN), a program that has been historically successful in bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make neighborhoods safer for everyone. PSN plays a major role in the Department of Justice’s violent crime reduction strategy. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. 

Three-Time Convicted Felon Sentenced to 66 Months for Illegal Possession of a Firearm

Defendant attempted to conceal pistol in child’s car seat

SHREVEPORT, La.– Gary D. Porter, 29, of Shreveport, was sentenced today by U.S. District Judge Donald E. Walter, to 66 months in federal prison and three years of supervised release following his prison term, for possession of a firearm by a convicted felon.

On November 19, 2018, officers with the Shreveport Police Department responded to the driveway of a residence after receiving a 911 call. As the officers arrived, Porter was backing his car out of the driveway with several young children in the vehicle. Officers made contact with Porter and upon further investigation, located a Ruger, Model Security-9, 9mm pistol loaded with twelve rounds of ammunition hidden underneath one of the children, between the child and the child’s car seat. At the time that Porter possessed the pistol, he knew his previous felony convictions prohibited him, under federal law, from possessing a firearm and ammunition. Porter’s prior felony convictions in Caddo Parish include: possession of marijuana – second offense (2011), possession of cocaine (2012), and possession with intent to distribute marijuana (2014).

The Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) and Shreveport Police Department investigated the case. Assistant U.S. Attorney Cadesby Cooper prosecuted the case.

Shreveport Man Pleads Guilty to Illegal Possession of Sawed-Off Shotgun

SHREVEPORT, La.– John Jackson Harkey, 35, of Shreveport, pleaded guilty today before U.S. District Judge Donald E. Walter to possession of a short-barreled shotgun not registered to him in the National Firearms Registration and Transfer Record.

On February 21, 2019, officers with the Shreveport Police Department obtained and executed a search warrant on Harkey’s downtown Shreveport residence. During the search, officers found an operable, short-barreled shotgun, with a barrel length less than 18 inches and an overall length less than 26 inches. Under federal law, shotguns with barrels shorter than 18 inches must be registered. Harkey admitted to possessing the firearm and that he had not registered the short-barrel shotgun with the National Firearms Registration and Transfer Record.   

The Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and Shreveport Police Department investigated the case. Assistant U.S. Attorney Mike Shannon is prosecuting the case.

Convicted Felon Sentenced to Two Years for Illegally Possessing Firearms During the Filming of a Music Video

SHREVEPORT, La. –Xavier Briggs, 27, of Shreveport, was sentenced today by U.S. District Judge Donald E. Walter, to two years in federal prison and three years of supervised release following his prison term, for felon in possession of firearms.

On April 25, 2019, officers with the Shreveport Police Department responded to AB Palmer Park in Shreveport where a large crowd was filming a music video with numerous firearms. Officers encountered 10 individuals standing around a Chevrolet Malibu and recovered multiple firearms from the scene. A camera being used to shoot the video was also seized and a search warrant was obtained to view its contents. Briggs can be seen in the video recordings in possession of a Jiminez Arms Model JA Nine 9mm pistol loaded with 4 rounds of 9mm ammunition, and a loaded DPMS Model A15, 5.56 mm rifle containing two 30-round magazines, and 41 rounds of 5.56 ammo.

Briggs has a 2011 armed robbery felony conviction in Caddo District Court and was released from prison in December 2018. It is a violation of federal law for a person previously convicted of a felony offense to possess firearms or ammunition.

The Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and Shreveport Police Department conducted the investigation. Assistant U.S. Attorney Brandon B. Brown prosecuted the case.

Shreveport Convicted Felon Sentenced to 54 Months for Illegal Possession of a Firearm

SHREVEPORT, La. –Christopher John Williams, 30, of Shreveport, was sentenced today by U.S. District Judge Donald E. Walter, to 54 months in federal prison and three years of supervised release following his prison term, for possession of a firearm by a convicted felon.

On January 31, 2019, Williams was arrested on a state offense and held in custody at Caddo Correctional Center. While he was in custody, he called two friends and asked them to get rid of a firearm that was located at his residence. Following the calls, agents made contact with an individual Williams shared his residence with and secured a Springfield XDS .45 caliber pistol. At his guilty plea on November 19, 2019, Williams admitted that the pistol belonged to him and to being a convicted felon. As a convicted felon, he knew it was illegal for him to possess a firearm or ammunition.

Williams has prior felony convictions in Caddo Parish for illegal use of a weapon (2007), second degree battery (2009), accessory after the fact – robbery (2014), domestic abuse battery (2015), and public intimidation (2017).   

The Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), the FBI Northwest Louisiana Violent Crimes Task Force, and the Shreveport Police Department conducted the investigation. Assistant U.S. Attorney Tennille M. Gilreath prosecuted the case.

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

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The year 2020 marks the 150^th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.

LAS VEGAS, Nev. — Albert Raul Franco was sentenced today by U.S. District Judge Andrew P. Gordon to three years in prison for illegally acquiring 11 firearms through a straw purchaser who made false statements on federal firearms transaction documents during the purchases, announced U.S. Attorney Nicholas A. Trutanich for the District of Nevada and Special Agent in Charge Patrick Gorman for the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF).

“Far too often, guns bought by straw purchasers end up in the hands of violent offenders and are recovered at crime scenes,” said U.S. Attorney Trutanich. “Together with the ATF, we will hold accountable individuals who lie on federal forms to buy guns illegally. Today’s sentence demonstrates our commitment to reducing gun violence, enforcing federal firearms laws through the Project Guardian initiative, and pursuing ‘Lie and Buy’ cases to make Nevada safer.”

Franco, 35, of Las Vegas, pleaded guilty in August 2019, to seven counts of illegal acquisition of a firearm. In addition to the prison term, Franco was sentenced to three years of supervised release.

According to court documents and admissions made in his plea agreement, on five separate occasions between July 28, 2017, and October 26, 2017, Franco directed co-defendant Tiffany Henderson to make false statements on the Firearms Transaction Record during the purchase of 11 handguns at different Federal Firearms Licensee businesses. On the Firearms Transaction Record, Henderson represented that she was the actual buyer of the firearms, when in fact these purchases were made on Franco’s behalf.

Franco, an admitted gang member and convicted felon, is prohibited from owning and possessing a firearm because of his prior convictions for multiple firearms and drug-related offenses and a conviction for assaulting a police officer. Franco’s pretrial release in this case was revoked after he failed to report an encounter with law enforcement during which he fled and was found to possess cocaine.

Co-defendant Henderson previously pleaded guilty to five counts of illegal acquisition of a firearm and aiding and abetting. She is scheduled to be sentenced on June 23, 2020.

The charges resulted from an investigation by the ATF. Assistant U.S. Attorney Simon Kung is prosecuting the case.

This case is part of Project Guardian, the Department of Justice’s signature initiative to reduce gun violence and enforce federal firearms laws. Initiated by the U.S. 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 ATF 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.

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COLUMBUS, Ga.– A registered sex offender caught downloading child pornography, some involving very young children, during a 2018 investigation was sentenced to 136 months in prison, said Charlie Peeler, the U.S. Attorney for the Middle District of Georgia. Donald McFall, 33, of Columbus, was sentenced today by U.S. District Judge Clay Land to 136 months in prison and 20 years supervised release after pleading guilty to one count possession of child pornography. McFall was convicted for sexual abuse in the 2^nd degree in the Circuit Court of Russell County, Alabama in 2015. McFall was also convicted in 2016 for felony failure to register as a sex offender in Muscogee County Superior Court. McFall will be required to continue registering as a sex offender once he is released from prison under the Sex Offender Registration Act. Failing to register as required by federal law will result in prosecution, with penalties including imprisonment and fines. There is no parole in the federal system.

A detective with the Georgia Internet Crimes Against Children (ICAC) Task Force was conducting an investigation in January 2018 into the trading and downloading of child pornography on peer-to-peer file sharing networks. Using a peer-to-program configured for law enforcement, 20 files of child pornography were downloaded from an IP address linked to a residence in Columbus, Georgia. This IP address was traced to McFall, a registered sex offender. Law enforcement executed a search warrant at the residence in March 2018 and arrested McFall after child pornography was discovered on his phone. McFall admitted to having more than 600 images of child pornography on his computer and cell phone, including pornography involving prepubescent children.

“For those who engage in the evil world of producing and consuming child sexual material online: Law enforcement agents are looking for you, they will find you and we will prosecute you to the fullest extent allowed by the law,” said U.S. Attorney Charlie Peeler. “There is a strong network of law enforcement agencies working 24 hours a day across our state, at every level, to track down criminals exploiting children. I want to commend the FBI, the Georgia ICAC Task Force and the GBI for their non-stop commitment to protecting our children and capturing child predators, and the Columbus Police Department for their excellent work capturing this sexual offender identified by the task force.”

"McFall clearly has not learned from his prior conviction that anyone who chooses to do harm to our most vulnerable citizens is a priority for FBI investigators and all of our partners in law enforcement," said Chris Hacker, Special Agent in Charge of FBI Atlanta. "Now he will pay a further price and will not be able to threaten any more children during his federal incarceration."

“There is a statistical correlation between those that seek out, collect and view child sexual abuse images and those that are actively molesting children. The fact that Donald McFall was a registered sex offender and previously convicted of sexual abuse proves this point,” said Debbie Garner, GBI Special Agent in Charge and Commander of the Georgia ICAC Task Force. “We will continue to try to find and rescue child victims of sexual abuse that we would not have otherwise known about by working these child sexual abuse imagery investigations.”

This case was investigated by the FBI, the Georgia ICAC Task Force, the GBI and the Columbus Police Department. Assistant U.S. Attorney Crawford Seals prosecuted the case for the Government. Questions can be directed to Pamela Lightsey, Public Information Officer, United States Attorney’s Office, at (478) 621-2603 or Melissa Hodges, Public Affairs Director (Contractor), United States Attorney’s Office, at (478) 765-2362.

The U.S. Attorney’s Office for the District of Minnesota, the Department of Justice Civil Rights Division and the FBI’s Minneapolis Field Office are conducting a robust criminal investigation into the circumstances surrounding the May 25, 2020, death of George Floyd. The Department of Justice has made the investigation a top priority and has assigned experienced prosecutors and FBI criminal investigators to the matter.

The federal investigation will determine whether the actions by the involved former Minneapolis Police Department officers violated federal law. It is a violation of federal law for an individual acting under color of law to willfully deprive another person of any right protected by the Constitution or laws of the United States. 

The Department of Justice asks for cooperation from all witnesses who believe they have relevant information and urges calm as investigators methodically continue to gather facts.

The Department of Justice and FBI’s comprehensive investigation will compile all available information and thoroughly evaluate evidence and information obtained from witnesses. Upon conclusion of the FBI’s investigation, the U.S. Attorney’s Office will determine whether federal criminal charges are supported by the evidence. If it is determined that there has been a violation of federal law, criminal charges will be sought.

Anyone with information can call the FBI at 1-800-CALLFBI (800-225-5324)

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United States Attorney’s Office, District of Minnesota: (612) 664-5600

NASHVILLE, Tenn–May 28, 2020 - A Piggly Wiggly grocery store in Lafayette, Tennessee and its proprietor have agreed to adopt written non-discrimination policies and to pay a monetary amount to a disabled woman to resolve allegations that they violated the Americans with Disabilities Act (ADA), announced Don Cochran, United States Attorney for the Middle District of Tennessee.

The settlement resolves allegations made by a disabled woman attempting to shop at her local Piggly Wiggly store. According to the complaint, the woman, with the assistance of her service animal, and her family, were shopping for groceries when the store’s proprietor ordered her out of the store. When the woman and her family attempted to explain her service animal’s protected status under the ADA, the proprietor called the police.

As a result of this investigation, Piggly Wiggly has adopted written ADA policies that require all employees to be trained regarding the rights of disabled individuals utilizing service animals. Piggly Wiggly is required to post its new policies so that they are accessible to the public and the store is subject to audit to ensure compliance with the settlement.

This case is a product of the United States Attorney’s Office’s continued commitment to protecting rights guaranteed under the ADA.

Assistant United States Attorney Dean S. Atyia handled this matter on behalf of the United States.

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According to court documents, ZAVALA was an illegal alien in possession of a firearm on April 16, 2019, found in the Eastern District of Louisiana.  Court documents also alleges he illegally possessed a Keltec model P11 9 millimeter pistol.

ZAVALA faced a maximum term of imprisonment of 10 years, a fine of $250,000, and three years of supervised release. He will be turned over to federal immigration authorities for deportation to Mexico.

U.S. Attorney Strasser praised the work of the United States Immigration and Customs Enforcement agency, the St. Tammany Parish Sheriff’s Office and 22^nd Judicial District Attorney Warren Montgomery in investigating this matter. Assistant United States Attorney Carter K.D. Guice, Jr. is in charge of the prosecution.

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SAVANNAH, GA:  Five Savannah-area residents are charged in a seven-count federal indictment handed down by a U.S. District Court grand jury meeting in virtual session in accordance with the COVID-19 pandemic.

The four men and one woman named in the indictment face charges with possible penalties of up to life in prison, said Bobby L. Christine, U.S. Attorney for the Southern District of Georgia. There is no parole in the federal system.

The Chatham-Savannah Counter Narcotics Team (CNT) and Drug Enforcement Administration (DEA) conducted the investigation leading to the arrests and indictments in the case, seizing thousands of methamphetamine-laced pills and their raw materials, along with industrial pill presses, stamps with logos including cartoon characters and the Facebook logo, substantial amounts of cash and a firearm.

“The dangerous mix of contraband narcotics and illegally possessed weapons continues to be a primary target of law enforcement operations in the Southern District,” said U.S. Attorney Christine. “Our efforts to infiltrate, disrupt and dismantle these activities will continue relentlessly as we seek to bring safety and security to our communities.”

Those charged in the indictment are:

• Kyrell Benton, 33, of Savannah, charged with Conspiracy to Manufacture, Possess with Intent to Distribute, and to Distribute Methamphetamine and Eutylone; Possession with Intent to Distribute Methamphetamine and Eutylone; and two counts of Use of a Drug-Involved Premises;
• Jamall Brown, 34, of Richmond Hill, Ga., charged with Conspiracy to Manufacture, Possess with Intent to Distribute, and to Distribute Methamphetamine and Eutylone; Possession with Intent to Distribute Methamphetamine and Eutylone; Possession of a Firearm in Furtherance of a Drug Trafficking Crime; Possession of a Firearm by a Convicted Felon; and Use of a Drug-Involved Premises;
• Antwan Benton, 29, of Savannah, charged with Conspiracy to Manufacture, Possess with Intent to Distribute, and to Distribute Methamphetamine and Eutylone; and Possession with Intent to Distribute Methamphetamine and Marijuana;
• Stacy Benton, 45, of Savannah, charged with Conspiracy to Manufacture, Possess with Intent to Distribute, and to Distribute Methamphetamine and Eutylone; and,
• Tina Lipsey, 42, of Savannah, charged with Conspiracy to Manufacture, Possess with Intent to Distribute, and to Distribute Methamphetamine and Eutylone; Possession with Intent to Distribute Methamphetamine and Eutylone; and Use of a Drug-Involved Premises.

The investigation into the operation continues.

Robert J. Murphy, the Special Agent in Charge of the DEA Atlanta Field Division, said “The distribution of dangerous drugs (in this case methamphetamine-laced pills), coupled with the possession of illegal weapons, are a recipe for disaster. Drug traffickers who peddle this poison are a menace to society. Because of the dedicated efforts between DEA, its law enforcement counterparts and the U.S. Attorney’s Office, this case is a shining example of what can be achieved when multi-level law enforcement agencies work collaboratively to protect their citizens.”

“CNT will continue to focus its resources on individuals who manufacture illegal drugs and work to stop the distribution of these toxic substances in to our community,” said Chatham-Savannah Counter Narcotics Team Director Dwane Ragan.  “I want to thank our Federal, State, and Local law enforcement partners, as well as the United States Attorney's Office, and applaud their continued cooperation with CNT's efforts to keep our community safe.”  

Criminal indictments contain only charges; defendants are presumed innocent unless and until proven guilty.

The case was investigated by the DEA and CNT, with assistance from the Savannah Police Department Special Weapons and Tactics Team, and is being prosecuted for the United States by Assistant U.S. Attorneys Frank Pennington and John P. Harper III.

U.S. Attorneys Trent Shores, Brian Kuester, and Timothy Downing today announced the selection of a Missing and Murdered Indigenous Persons (MMIP) Coordinator to serve in Oklahoma. Ms. Patti Buhl was selected for this critical position. Ms. Buhl will maximize the resources of the three United States Attorney’s Offices to ensure effective and timely responses to missing and murdered Native Americans in Oklahoma.

As MMIP Coordinator, she will support investigations into missing and murdered persons; consult with tribal communities to assist in the creation and implementation of community action plans; coordinate with tribal, local, state, and federal law enforcement in the development of protocols and procedures for responding to MMIP cases; and promote improvement of data collection and analyses throughout Oklahoma. Her start date is June 8.

“Patti Buhl will be a difference maker in our efforts to combat the crisis of missing and murdered Native Americans. Now is the time for action, and Oklahoma’s United States Attorneys are prepared to help lead the way,” said Trent Shores, U.S. Attorney for the Northern District of Oklahoma.

“The joint MMIP coordinator will maximize the collaborative efforts of the three Oklahoma United States Attorney’s Offices as we work toward our common goal of ensuring appropriate response to missing and murdered indigenous people in Oklahoma,” said Brian J. Kuester, U.S. Attorney for the Eastern District of Oklahoma. “Ms. Buhl will undoubtedly find great support from our federal, tribal, state, and local law enforcement partners and non-governmental service organizations who understand and appreciate that working together we can and will enhance public safety in Indian Country.”

“We are pleased to have Ms. Buhl join our ranks to help further our great working relationship with all our tribes and the U.S. Attorney’s Offices in Oklahoma to address violence in Indian Country,” said Timothy J. Downing, U.S. Attorney for the Western District of Oklahoma.  “Together, we will continue to partner with tribes to improve public safety for all Native Americans throughout the state.”

On November 22, 2019, Attorney General William Barr launched a national strategy to address missing and murdered Native Americans. When establishing the Missing and Murdered Indigenous Persons (MMIP) Initiative, the Department of Justice made an initial investment of $1.5 million to hire MMIP coordinators to serve with U.S. Attorney’s Offices in 11 states.  States receiving MMIP coordinators are Oklahoma, Alaska, Arizona, Minnesota, Montana, Michigan, Utah, Nevada, Oregon, New Mexico, and Washington.

“Congratulations to the U.S. Attorneys and Patti Buhl for joining together to investigate and locate missing Native Americans. The missing are mostly children and women. Protecting our most vulnerable people by the tribes working with the Department of Justice will halt these atrocities,” said Principal Chief Geoffrey Standing Bear of the Osage Nation.

The Inter-Tribal Council of the Five Civilized Tribes also voiced support for the hiring of Ms. Buhl:

“For too many Natives, violence is an ever-present threat. We must do more to stop this nightmare that has haunted Native persons for far too long, and appointing Ms. Buhl as a Missing and Murdered Indigenous Persons coordinator here in Oklahoma is crucial to this mission. With her background in law enforcement, including her time working with the Cherokee Nation Marshal Service and investigating missing persons cases, Ms. Buhl will play a pivotal role in helping to find the many Native Americans who have gone missing, most of them women and children. As tribal leaders, we are especially proud that a member of a federally recognized tribe has been chosen for this role, knowing full well that her work will make a lasting difference across all of Indian Country. The Inter-Tribal Council of the Five Civilized Tribes thanks the U.S. Attorney’s Offices for taking this important step."

Leaders of the council are Cherokee Nation Principal Chief Chuck Hoskin Jr., Chickasaw Nation Governor Bill Anoatubby, Choctaw Nation of Oklahoma Chief Gary Batton, Seminole Nation of Oklahoma Chief Greg Chilcoat, and Muscogee (Creek) Nation Principal Chief David Hill.

Prior to her selection as MMIP coordinator, Ms. Buhl served in law enforcement at Northeastern State University.

“Patti joined the NSU team in 2003 and eventually became our first female Chief of Police in 2009,” said Northeastern State University President Steve Turner. “I appreciate Patti’s 17 years of dedicated service protecting the NSU family and citizens of our communities. Although she understood and embraced her role as an enforcer of the law, she was always a teacher who worked tirelessly to educate our students on appropriate and lawful conduct. Her experience will be invaluable to her new role with the U.S. Attorney’s Offices. ”

Ms. Buhl, a citizen of the Cherokee Nation, has worked in law enforcement for 25 years, most recently serving Chief of Police for Northeastern State University in Tahlequah. She has also served with the Cherokee Nation Marshal Service where she enforced tribal, state, Federal, and municipal laws within the 14 county jurisdictional boundaries of the Cherokee Nation. Ms. Buhl is experienced in investigating missing persons and coordinating with tribal governments and organizations. She has also collaborated with the FBI, Secret Service, and IRS while investigating criminal cases. Ms. Buhl has further assisted in the development of policies and guidelines for law enforcement. She earned a Master of Science in Criminal Justice and is on track to receive her Juris Doctor from the Mitchell Hamline School of Law in December 2020.

Also this week, the Presidential Task Force on Murdered and Missing American Indians and Alaska Natives is holding remote listening sessions with Tribes throughout the country. U.S. Attorney Trent Shores is a member of the Task Force. On May 29, from 1-2:30 pm CDT, a listening session is scheduled to be held with the Tribes from Oklahoma, Texas, Kansas, Colorado, New Mexico, Nevada, Utah, Arizona, Montana and Wyoming. Tribal Listening Session Webinars are open to Tribal Leaders and others. Sessions will include a short presentation about the current activities of the task force, followed by a listening session.

The Task Force was announced on Nov. 26, 2019. It was established by President Donald Trump to address the legitimate concerns of American Indian and Alaska Native communities regarding missing and murdered people — particularly missing and murdered indigenous women and girls. You can learn more about the Task Force, also known as Operation Lady Justice, here.

Tampa, Florida – United States Attorney Maria Chapa Lopez announces the unsealing of an indictment charging James Lee Clark (59, Wilton Manors) with one count of conspiracy to commit bankruptcy fraud, seven counts of bankruptcy fraud, one count of making a falsification of records in a bankruptcy proceeding, and eight counts of wire fraud. If convicted, Clark faces up to 20 years’ imprisonment for the falsification of records count and for each wire fraud count. He faces up to 5 years in federal prison for the conspiracy count, and for each bankruptcy fraud count. The indictment also notifies Clark that the United States is seeking a money judgment of $1.3 million, the proceeds of the charged criminal conduct.

According to the indictment, from January 2010 through February 2017, Clark conspired with his paralegal, Eric Liebman, to defraud mortgage creditors and guarantors, such as Fannie Mae, who were holding mortgage notes on properties that were in foreclosure. The indictment further charges that Clark and Liebman falsely and fraudulently represented to the distressed homeowners facing foreclosure that, in exchange for executing quitclaim or warranty deeds for their properties to an entity controlled by Liebman, they would negotiate with the mortgage creditors to prevent foreclosures. Clark and Liebman convinced the distressed homeowners to pay them rent, or agree to put their houses up for sale. In order to continue to collect ill-gotten rents, or profit from the sale of the properties, Clark allegedly filed fraudulent bankruptcy petitions in the names of the homeowners to prevent the mortgage creditors from lawfully foreclosing and taking title to the property. In some instances, Clark filed multiple fraudulent petitions in the names of distressed homeowners.

Additionally, it is further alleged that, from January 2012 to February 2017, Clark, who was a licensed attorney, defrauded his clients out of approximately $1.3 million. As part of his practice, Clark would act as a trustee for his clients and also hold their money in various bank accounts depending on the purpose of trust.  Instead of using the funds for the purpose intended by his clients, Clark would divert the money into his law firm’s bank accounts and pay for personal expenses, such as gambling, travel, and automobiles. 

Liebman pleaded guilty to one count of conspiracy to commit bankruptcy fraud on September 24, 2019. His sentencing hearing is scheduled for January 14, 2021.

An indictment is merely a formal charge that a defendant has committed one or more violations of federal criminal law, and every defendant is presumed innocent unless, and until, proven guilty. 

This case was investigated by the Federal Bureau of Investigation and the Federal Housing Finance Agency – Office of Inspector General. The Office of United States Trustee for the Middle District of Florida, Tampa Division provided substantial investigative assistance. It will be prosecuted by Special Assistant United States Attorney Chris Poor.

ERIE, Pa. - A former inmate of Allenwood United States Penitentiary in Allenwood, Pennsylvania, has been sentenced in federal court to 8 months in jail on his conviction of infliction of bodily injury, United States Attorney Scott W. Brady announced today.

United States District Judge David S. Cercone imposed the sentence on Lawrence W. Nelson, 45. The sentence was imposed to run consecutively to the sentence Nelson is currently serving.

According to information presented to the court, 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.

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

United States Attorney Brady commended the Officers of the McKean Federal Correctional Institution and the Federal Bureau of Investigation for the investigation leading to the successful prosecution of Nelson.

FORT WAYNE – Steven Smith, age 59, of Fort Wayne, Indiana, was sentenced before U.S. District Court Judge Holly A. Brady following his plea of guilty to attempting to distribute one kilogram or more of heroin, announced U.S. Attorney Kirsch.

Smith was sentenced to 188 months in prison followed by 10 years of supervised release. 

According to documents presented in this case, in August of 2014, Mr. Smith coordinated a two-kilogram heroin transaction with an undercover employee with the FBI; however, Smith was arrested just prior to the deal.  This case is Smith’s fifth conviction for drug dealing, and he was classified at sentencing as a career offender. 

“The hard work of FBI special agents and task force officers prevented Smith from distributing massive quantities of dangerous heroin on the streets of Fort Wayne and northeastern Indiana,” said U.S. Attorney Kirsch.  “We have a great coordinated partnership throughout the Northern District of Indiana and will continue to prosecute those who seek to flood our streets with dangerous and illegal narcotics.”

The case was investigated by the Federal Bureau of Investigation’s Safe Streets Gang Task Force, which includes the FBI, Indiana State Police, Allen County Sheriff’s Department, and Fort Wayne Police Department.  The case was prosecuted by Assistant United States Attorney Anthony W. Geller.