United States Attorney Joe Kelly announced that Joseph Lloyd James, 49, of Norfolk, was sentenced today in federal court in Omaha to life imprisonment for First Degree Murder in Indian Country by United States District Court Judge Brian C. Buescher. On November 5, 2018, James murdered Phyllis Hunhoff of Yankton, South Dakota, on the Santee Sioux Indian Reservation in Nebraska. There is no parole in the federal system. As part of his plea agreement, he waived his right to appeal, to seek a pardon, or seek a commutation.

Phyllis Hunhoff regularly traveled from her home in Yankton to her mother’s home in Utica, South Dakota.  Her regular practice was to call her mother upon returning to Yankton.  On November 4, 2018, at approximately 10 p.m., Phyllis Hunhoff left her mother’s residence, alone, to drive home to Yankton.  She did not call her mother as she did not make it home.  Having not heard from her daughter, her mother began repeatedly calling her phone to determine her whereabouts.  All calls were unanswered.

James and other men were near Phyllis Hunhoff’s mother’s residence as she was leaving.  James and another man encountered Phyllis Hunhoff outside of the residence and got into her car with her inside.  James, Phyllis Hunhoff, and another man traveled to Norfolk, Nebraska, arriving at about 11:00 p.m.  When they arrived in Norfolk, James remained in the vehicle, and the other man left the vehicle.  James drove Phyllis Hunhoff’s vehicle, with her inside, to the Santee Sioux Indian Reservation in Knox County, Nebraska. 

During the early morning hours of November 5, 2018, while on the Santee Sioux Indian Reservation, James killed Phyllis Hunhoff.  He stabbed her with a knife and strangled her.  She died in her vehicle as a result of the bleeding and strangulation.  James drove Phyllis Hunhoff’s vehicle to a gas station on the Santee Sioux Indian Reservation.  Video from the gas station showed James putting gasoline into her vehicle and driving away.  Later, James returned in the same vehicle to the gas station and pumped gasoline into a soda bottle.  James put the bottle containing the gasoline into the vehicle.  He then drove to a wooded location on the Santee Sioux Indian Reservation in Knox County, Nebraska, where he set fire to Hunhoff’s body and her vehicle to conceal evidence of the murder.  He abandoned the body and vehicle and left the area.

Law enforcement officers investigated the murder and obtained evidence, including surveillance footage of James at the gas station during the early morning hours of November 5, 2018.  Santee Police recovered the shirt James was wearing when he killed Phyllis Hunhoff.  Her DNA was on James’ shirt.  James’s DNA was on clothing Phyllis Hunhoff was wearing when he killed her. 

“Your conduct has taken a life and altered the lives of others,” Judge Brian C. Buescher told James before imposing a life sentence. “I hope you remember the pain you caused for everyday of your sentence which will be for the rest of your life.”

U.S. Attorney Kelly stated, “This was a brutal, horrific, and senseless murder and we hope that today’s life sentence brings some small comfort for the family.”

FBI Omaha Special Agent in Charge Kristi Johnson said, “The Santee Sioux Nation Tribal Police, Knox County Sheriff and Nebraska State Patrol partnered with FBI Omaha to investigate the brutal murder of Phyllis Hunhoff.  Those efforts brought us to Joseph James’s life sentence today. The FBI will continue to work with our law enforcement and Native American partners and to fight crime on tribal land.”

The case was investigated by the Federal Bureau of Investigation, the Nebraska State Patrol, Knox County Sheriff’s Office, Santee Sioux Nation Tribal Police, Yankton County Sheriff’s Office, Yankton Police Department (South Dakota), Norfolk Police Department, the University of Nebraska Medical Center, the Nebraska State Fire Marshal, and the Lincoln Police Department. 

The case was prosecuted by Assistant United States Attorneys Jody B. Mullis and Sean P. Lynch.

United States Attorney Joe Kelly announced that Titus J. Miller, age 27, of Lincoln, Nebraska, entered a plea of guilty today in federal court in Lincoln before United States Magistrate Judge Cheryl R. Zwart for producing child pornography.  Miller admitted to the sexual exploitation of five children between August 17, and October 15, 2019.  Magistrate Judge Zwart set Miller’s sentencing for October 15, 2020, at 12:00 p.m., before Senior United States District Judge Richard G. Kopf.  Miller faces up to 30 years’ imprisonment and a fine of $250,000 on each count.  After release from any imprisonment, Miller would be subject to a term of supervised release of not less than five years and up to life and will also be required to register as a sex offender.

Miller was employed at Playful Painters Daycare, located in Lincoln.  Miller worked at night and was a supervisor at the daycare.  During the time periods of the Indictment, Miller produced videos of minor victims, with ages ranging from 4 to 6 years old, engaging in sexually explicit conduct.  Miller used a cellular phone to produce the videos and transported some of the videos to a person in Alabama. 

United States Attorney Kelly expressed his appreciation to the Federal Bureau of Investigation and the Lincoln Police Department for their thorough investigation upon receiving notification of children being placed at risk of being sexually abused.

FBI Omaha Special Agent in Charge Kristi Johnson said today, “Titus Miller’s sexual abuse of 5 innocent children is an especially heinous crime.  The FBI will use all its investigative strength to bring those who exploit children to justice.  The FBI’s Lincoln office, together with the Lincoln Police department, worked tirelessly on the investigation which has now concluded with Miller’s guilty plea.”

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

The case was investigated by the Federal Bureau of Investigation and the Lincoln Police Department.

         LOS ANGELES– A West Hollywood man pleaded guilty today in federal court in Miami to criminal charges stemming from the sale of bogus artworks he claimed were created by famed modern artists, and he was immediately ordered to serve 60 months in federal prison.

         Philip Righter, 43, pleaded guilty to three felony charges in a case filed in Los Angeles and admitted selling works he falsely claimed were created by artists such as Jean-Michel Basquiat, Keith Haring, Roy Lichtenstein and Andy Warhol. Righter also admitted using fake artwork as collateral for loans on which he later defaulted, and using bogus pieces for fraudulent write-offs on his income tax returns.

         Righter pleaded guilty to three felony offenses – wire fraud, aggravated identity theft and tax fraud – and was sentenced by United States District Judge Marcia G. Cooke of the Southern District of Florida. In total, Righter’s scheme attempted to bilk victims out of well over $6 million, and he caused losses of at least $758,265. Additionally, his fraudulent tax returns cost the United States more than $100,000, according to a plea agreement in the case.

         Judge Cooke also sentenced Righter to 60 months in federal prison in relation to a case filed by federal prosecutors in Miami. Righter pleaded guilty in that case in March and admitted trying to sell Haring and Basquiat forgeries to the owner of a Miami art gallery. The sentences in both cases will run concurrent with each other.

         In the Los Angeles case, Righter admitted he executed a scheme to defraud people, businesses and the United States from 2016 until June 2018 by using counterfeit and fraudulent art that he asserted was genuine. Righter supported these false claims with fraudulent provenance – or chronology-of-origin – documents that he had created.

         Before August 2016, Righter generally conducted these fraudulent transactions in his own name. But after the FBI and the Los Angeles Police Department interviewed him about bogus Keith Haring art he attempted to sell to the Miami art gallery, Righter began using the names of other people to execute his scheme, court documents state.

         To make the fake artwork appear to be genuine, Righter ordered and used embossing stamps that appeared similar to the stamps used by the estates of Basquiat and Haring to authenticate works by these artists.

         In furtherance of the scheme, Righter obtained and attempted to obtain numerous loans by using the fraudulent art and accompanying fraudulent provenance documents. For example, in October 2016, using another person’s name, Righter contacted a victim about a loan in which a purported original drawing by Basquiat would be used as collateral. Righter created a fraudulent certificate of authentication letter that purportedly came from Basquiat’s estate. The victim wired a $24,000 loan, on which Righter later defaulted. After Righter’s default, the victim attempted to auction the piece, but the auction house determined the piece was fraudulent, and the victim lost $24,000.

         Righter also sold or attempted to sell numerous pieces of fake modern art. In August 2017, using another person’s name, Righter listed a purported 1983 piece of art by Basquiat with the word “Samo” written on it with an art sale website and he provided fake provenance documents. The website sold the piece for $50,000. In 2018, after the piece was determined to be fraudulent, the website had to refund the purchase price to the buyer.

         Righter also admitted that he knowingly and willfully included a false W-2 and documentation of a donation of fraudulent art to a charity on his 2015 federal income tax return, which resulted in him fraudulently receiving a refund of $54,858. Righter then signed and filed a false 2015 amended tax return, which claimed a false casualty and theft loss of $2,575,000 related to artwork he claimed had been stolen. In truth, the artwork was fraudulent and had no value. This bogus amended tax return resulted in false carryback loss refunds for 2012, 2013 and 2014 totaling $52,485, according to court documents.

         The FBI’s Art Crime Team, the Los Angeles Police Department, and IRS Criminal Investigation investigated this matter.

         The Los Angeles case was prosecuted by Assistant United States Attorneys Mark A. Williams and Erik M. Silber of the Environmental and Community Safety Crimes Section.

MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced that Brandis Nicole Fish, age 36, of Henryetta, Oklahoma entered a guilty plea to Possession With Intent To Distribute Methamphetamine, in violation of Title 21, United States Code, Sections 841(a)(1) and 841(b)(1)(B), punishable by not less than 5 years to not more than 40 years imprisonment, a fine up to $5,000,000.00 or both. 

The Indictment alleged that from on or about January 27, 2020, in the Eastern District of Oklahoma, the defendant, did knowingly and intentionally possess with intent to distribute 50 grams or more of a mixture or substance containing a detectable amount of methamphetamine, a Schedule II controlled substance. 

The charges arose from an investigation by the Okmulgee County Sheriff’s Office and the Federal Bureau of Investigation Safe Trails Task Force. The Oklahoma Safe Trails Task Force is comprised of the FBI and nine partner agencies including: Muscogee Creek Nation Lighthorse Police, Okmulgee Police Department, Okmulgee Sheriff’s Office, Oklahoma Bureau of Narcotics, District 25 District Attorney’s Investigators, Cherokee Nation Police, Tahlequah Police Department, and Wagoner Police Department.  The task force is focused on combating and reducing crime related to tribal jurisdictions across Oklahoma. 

The Honorable Kimberly E. West, U.S. Magistrate Judge in the United States District Court for the Eastern District of Oklahoma, in Muskogee, accepted the plea and ordered the completion of a presentence investigation report.

Assistant United States Attorney Ryan Conway represented the United States at the change of plea hearing.

CHARLESTON, W.Va. – Tammy Newsome, 54, of Ashland, Kentucky, entered a guilty plea to mail fraud for her role in a scheme to defraud Toyota of more than $4.3 million, announced United States Attorney Mike Stuart. Newsome joins three other individuals who previously entered guilty pleas for their roles in the fraud scheme.

Newsome faces up to 20 years in prison when she is sentenced on October 15, 2020, and will be required to pay restitution of up to $4.3 million to Toyota. 

“Newsome played a critical role in perpetrating this $4 million fraud scheme,” said United States Attorney Mike Stuart. “I commend the great investigative work of the U.S. Postal Inspection Service, the FBI, the W.V. State Police, and the W.V. Insurance Commissioner. Toyota may have suffered the loss but, ultimately, it’s consumers who really pay. These fraud schemes rip off every consumer. That’s why we work so hard to hold those responsible accountable.”

Newsome was employed as an administrative assistant for a Kentucky used car dealership, Big Blue Motor Sales, which bought trucks at wholesale prices at auction, obtained hundreds of copies of Kentucky and West Virginia residents’ driver’s licenses, fraudulently titled the trucks in the name of those residents, and induced Toyota to repurchase the trucks at 150% of value.

The scheme relied on Newsome to make false representations to the Department of Motor Vehicles to obtain false vehicle titles in the names of false owners. The titles obtained by Newsome were then used by other scheme participants to induce Toyota to repurchase the vehicles. Newsome admitted that she made false representations to the DMV, delivered cash bribes to other scheme participants, and forged signatures of false owners so that checks issued by Toyota in the name of a false owner could be deposited into Big Blue Motor Sales’ bank account.

The United States Postal Inspection Service, the Federal Bureau of Investigation, the West Virginia State Police and the West Virginia Office of the Insurance Commissioner conducted the investigation. United States District Judge Joseph R. Goodwin presided over the hearing. Former Assistant United States Attorney Stefan Hasselblad and Assistant United States Attorneys Andrew J. Tessman and Steven I. Loew are handling the prosecution.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Southern District of West Virginia. Related court documents and information can be found on PACER by searching for Case No. 2:19-CR-00250.

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Audrey Strauss, the Acting United States Attorney for the Southern District of New York, announced today that the United States has entered into a consent decree to settle a federal civil rights lawsuit brought by the United States against 111 EAST 88^TH STREET PARTNERS (“111 PARTNERS”), for violating the Fair Housing Act.  Specifically, the lawsuit alleges that 111 PARTNERS discriminated against a disabled, rent-controlled tenant (the “Tenant”) by refusing to permit the Tenant to live with an assistance animal to accommodate the Tenant’s disability, as a reasonable accommodation to defendant’s policies, and by interfering with the Tenant’s exercise of his rights under the Fair Housing Act. 

Acting U.S. Attorney Audrey Strauss said:  “This is yet another lawsuit brought to enforce the rights of tenants with disabilities to live with an assistance animal.  With this resolution, we again emphasize that condominiums, cooperatives, landlords, and property managers are required by federal law to provide reasonable accommodations to people with disabilities.”

The Fair Housing Act makes it unlawful to discriminate in the terms and conditions of the sale or rental of, or to otherwise make unavailable or deny, a dwelling based on the prospective buyer or renter’s disability.  The law also mandates that reasonable accommodations in rules, policies, practices, and services be provided when necessary to afford equal housing opportunities to persons with disabilities.

According to the allegations in the Amended Complaint filed in federal court:

111 Partners is the owner of certain units in a 61-unit condominium located in New York, New York, and the landlord of the rent-controlled apartment that the Tenant occupies in the building.  The Tenant, now 58 years old, has resided in that apartment his entire life and has a long history of depression.  In 2006, the Tenant adopted a dog to help alleviate his depression and requested a reasonable accommodation to defendant’s “no pets” policy to allow him to reside with his dog in the apartment.  Defendant not only denied the request, but also initiated eviction proceedings against him.  While those proceedings were underway, in spring 2015, the Tenant was diagnosed with End Stage Renal Disease, and his depression worsened.  The Tenant promptly sought another reasonable accommodation to 111 Partners’ “no pets” policy to allow him to keep his dog in the apartment given the substantial emotional assistance the dog provided and the Tenant’s changed circumstances.  111 Partners constructively denied the request by requiring the onerous disclosure of detailed medical records and other information, despite the Tenant’s already well-substantiated request and defendant’s familiarity with his condition.  In June 2017, after his dog died and during the pendency of this litigation, the Tenant again requested a reasonable accommodation to 111 Partners’ “no pets” policy to permit him to adopt another dog for emotional support, and once again, 111 Partners constructively denied the request – requiring extensive documentation despite the fact that the Tenant had continued to provide documents, expert opinions, medical records, and sworn testimony in support of his request. 

Under the consent decree approved by U.S. District Court Judge Paul G. Gardephe on July 14, 2020, 111 PARTNERS must:

• Adopt a reasonable accommodation policy regarding requests for assistance animals;
• Comply with certain notice, training, and recordkeeping requirements to ensure that its employees are knowledgeable about and comply with the requirements of the Fair Housing Act;
• Allow the United States to monitor compliance with the consent decree;
• Dismiss all pending state court litigation against the Tenant, including the eviction proceedings commenced in 2006 regarding his request to keep an emotional support animal and termination proceedings commenced in 2019 regarding apartment conditions, and waive all claims to attorney’s fees and costs;
• Grant the Tenant a reasonable accommodation for the remainder of his tenancy, such that he can adopt and reside with a dog for as long as the Tenant lives in the apartment, without submitting any further reasonable accommodation requests.

The case is being handled by the Office’s Civil Rights Unit.  Assistant U.S. Attorney Brandon Waterman is in charge of the case.

SYRACUSE, NEW YORK – Robert Bresee, age 57, of Norwich, New York, was sentenced today to 180 months (15 years) in prison for transporting and possessing child pornography, announced United States Attorney Grant C. Jaquith and Thomas F. Relford, Special Agent in Charge of the Albany Field Office of the Federal Bureau of Investigation (FBI).

Bresee, who was previously convicted in Chenango County Court of Rape in the First Degree, and sentenced to 15 years’ in prison, admitted that while on post-release supervision from that offense he uploaded 70 images of child pornography to a Google account, and possessed an additional 21 images on his cellular telephone.

Senior United States District Judge Thomas J. McAvoy also imposed a 15-year term of supervised release, which will start after Bresee is released from prison, and ordered a $200 special assessment. Bresee, who is currently designated a Risk Level 3 Sexually Violent Offender, will be required to continue to register as a sex offender upon his release from prison.

Bresee’s case was investigated by the Federal Bureau of Investigation (FBI) and the Norwich Police Department.  The case was prosecuted by Assistant U.S. Attorney Geoffrey J. L. Brown.

Launched in May 2006 by the Department of Justice, Project Safe Childhood is led by United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS). Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit https://www.justice.gov/psc.

PHILADELPHIA – United States Attorney William M. McSwain announced that Nicholas Bufanio, 53, of Hellertown, PA pleaded guilty to one count of health care fraud before United States District Court Judge Joseph F. Leeson, Jr.

Bufanio is a doctor of chiropractic medicine, who has operated Community Chiropractic, Inc. in Bethlehem, PA, since at least 2011. The defendant submitted fraudulent claims to health insurers of approximately $236,000 for chiropractic services he did not render. He routinely submitted claims for patients who failed to appear for scheduled appointments, falsely asserting that he saw the patients and provided chiropractic care. He also submitted fraudulent claims for days when he was not even in the office.

Additionally, from November 2017 until approximately December 2018, Bufanio was convalescing at home. Although he did not see patients during this time, the defendant submitted bogus claims to health insurers pretending that he was keeping normal office hours and rendering chiropractic treatment.

“Physicians and other medical professionals who fraudulently bill insurance companies are thieves – they steal from both the companies and the honest subscribers,” said U.S. Attorney McSwain. “Dr. Bufanio was arrogant enough to think that he could get paid for doing nothing. My Office will continue to use every tool at its disposal to investigate, prosecute, and punish this type of fraud.”

“Through our criminal enforcement program, the U.S. Department of Labor, Employee Benefits Security Administration (EBSA), will vigorously pursue those who violate the criminal laws protecting private–sector employee benefit plans,” said EBSA Philadelphia Regional Director Michael Schloss.

The case was investigated by U.S. Department of Labor-Employee Benefits Security Administration, and is being prosecuted by Assistant United States Attorney M. Beth Leahy.

CHARLESTON, W.Va. – Two Project Guardian defendants were sentenced this week in federal court, according to United States Attorney Mike Stuart.

Ronald Hambleton, 29, of Charleston, was sentenced to 68 months in prison for possession with intent to distribute cocaine and possession of a firearm in furtherance of a drug trafficking crime. He also will serve three years on supervised release. On July 18, 2019, South Charleston police stopped a speeding car in which Hambleton was a passenger. During the stop, Hambleton was found to be in possession of, with intent to distribute, nearly half an ounce of cocaine, as well as some marijuana and digital scales. Police also recovered a loaded Ruger LCP .380 caliber firearm in the car’s center console. Hambleton claimed ownership of the drugs, drug paraphernalia and loaded firearm on scene. The South Charleston Police Department conducted the investigation. Former Assistant United States Attorney Stefan Hasselblad and Assistant United States Attorney Negar M. Kordestani handled the prosecution.

James Owen Adkins, 40, of Lincoln County, was sentenced to 18 months in prison for being a felon in possession of a firearm. He also was ordered to complete two years of supervised release. A federal jury sitting in Charleston convicted Adkins on February 5, 2020, of illegally possessing a Springfield XD 9mm pistol in St. Albans while being a convicted felon. The jury found that on June 4, 2019, Adkins removed a Springfield XD 9mm pistol from a truck that drove away from St. Albans police officers during an attempted a traffic stop. Adkins took the pistol from the truck, climbed out and ran off through a residential neighborhood as police pursued him on foot with a K-9. Prior to being apprehended by police, Adkins discarded the firearm under a shrub next to a residence where young children resided. Police officers recovered the firearm at the scene. Adkins admitted in an interview with officers that he was a felon, that he ran from police with the firearm, and that he discarded it. The St. Albans Police Department conducted the investigation. Assistant United States Attorneys Kristin F. Scott and Steven I. Loew handled the prosecution and tried the case before the federal jury.

United States District Judge Joseph R. Goodwin imposed the sentences. 

The cases were prosecuted as 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. The United States Attorney’s Office has prosecuted these cases with support from the Project Guardian partners noted above. For more information about Project Guardian, please see: https://www.justice.gov/projectguardian.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Southern District of West Virginia. Related court documents and information can be found on PACER by searching for Case No. 2:19-CR-00242 (Hambleton) and Case No. 2:19-CR-00226 (Adkins).

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               BEAUMONT, Texas - U.S. Attorney Stephen J. Cox announced today that eight individuals have been arrested in the Eastern District of Texas pursuant to a federal indictment which alleges drug and money laundering violations.

               A federal grand jury returned the 24-count indictment on June 3, 2020, charging the following individuals with drug trafficking and money laundering crimes:

               Jake Ellis Daughtry, 34, of Nederland, Texas;

               Joseph Ellis Daughtry, 64, of Nederland;

               Kip William Daughtry, 46, of Vidor, Texas;

               Sandra Miller Daughtry, 72, of Nederland;

               Jordan Lee King, 31, of Nederland;

               Tanner John Jorgensen, 28, of Nederland;

               Austin Wayne Dial, 28, of Nederland; and

               Jesse Lee Hackett, 37, of The Woodlands, Texas.

               The defendants were arrested by a joint law enforcement task force today and will make initial appearances in federal court this afternoon, July 15, 2020, and tomorrow, July 16, 2020.  A ninth defendant is already in custody.

               According to court documents, the defendants are charged with conspiracy to possess with intent to distribute, and distribution of, a controlled substance analogue resulting in death; conspiracy to possess with intent to distribute, and distribution of, a date rape drug over the internet to an unauthorized purchaser; maintaining a drug-involved premises; possession with intent to distribute, and distribution of, a controlled substance analogue; and money laundering.

               The defendants are alleged to be the head of a Chemical Trafficking Organization (“CTO”) cell operating on a national scale.  Investigation of the organization began in 2018 when the Drug Enforcement Administration intercepted mail parcels of a chemical identified as 1,4 butanediol, commonly referred to as “BDO.”  BDO is a chemical manufactured only for industrial or laboratory use as a floor stripper or vehicle wheel cleaner and is not intended for human consumption.  Investigators determined that when BDO is ingested, it immediately metabolizes into GHB (a known date-rape drug) with the same effects, causing potential overdoses, addiction, and death.

               DEA traced the seized parcels to their origination point, Right Price Chemicals, a business located on Twin City Highway in Nederland, Texas, and owned by Jake Daughtry, Joe Daughtry and Sandra Daughtry.    Also located at Right Price Chemicals is a seasonal fireworks business called “Jake’s Fireworks.”  Agents determined that since 2016, Right Price Chemicals has distributed approximately 7,000 gallons of BDO over thousands of orders, and that those sales generated $4.5 million.

               Agents additionally determined that Jake’s Fireworks operated as a front for Right Price Chemicals, allowing individuals to purchase BDO on a walk-in basis.  Customers could also obtain BDO from Jake’s Fireworks through internet orders, and have the chemical shipped to their home.  Right Price Chemicals also distributed bulk quantities BDO to mid-level dealers, who, in turn, sold or distributed the chemical to users.  Investigators determined that at least two deaths—one in Virginia and one in Florida—were directly caused by BDO sold by Right Price Chemicals.  Right Price Chemicals distributed BDO in 48 states across the country.

               Investigators have also determined that the proceeds from the distribution and sale of BDO, which total over $1 million, have been laundered through several bank and retirement accounts throughout Southeast Texas.  Those accounts have now been seized.

If convicted of the criminal charges, the defendants face a minimum term of 20 years, and up to life, in federal prison.

               In addition to pursuing criminal charges, on July 13, 2020, the Eastern District sought and obtained a temporary restraining order against Jake’s Fireworks and any other businesses housed within the Twin City Highway location in Nederland.  This civil injunctive relief immediately shuts down operations of the business and any further distribution of BDO and other chemicals.  Jake Daughtry, Joe Daughtry, Sandra Daughtry, and Kip Daughtry also face civil penalties under the Controlled Substance Act.

               This is an Organized Crime Drug Enforcement Task Force (OCDETF) case and is being investigated by the Drug Enforcement Administration West Palm Beach, Florida District Office, DEA Beaumont Resident Office; the United States Postal Service; the Internal Revenue Service-Criminal Investigation; the Bureau of Alcohol, Tobacco, Firearms and Explosives; and the Jefferson County Sheriff's Office.  Essential support and coordination was provided by numerous components of DEA headquarters and the Department of Justice’s multi-agency Special Operations Division (SOD), including assigned attorneys from the Narcotic and Dangerous Drug Section (NDDS).  This case is being prosecuted by Assistant U.S. Attorneys Michelle S. Englade and Robert Wells.

               An indictment is not evidence of guilt.  All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

NEWARK, N.J. – A federal grand jury today indicted a Somerset County, New Jersey, man for allegedly distributing and possessing images of child sexual abuse, U.S. Attorney Craig Carpenito announced.

John Schulenburg, 65, of Basking Ridge, New Jersey, is charged with one count of distribution of child pornography and one count of possession of child pornography. He will be arraigned at a date to be determined. Schulenberg was arrested on a criminal complaint on this conduct on Nov. 6, 2019, and was released on $100,000 unsecured bond. 

According to documents filed in this case and statements made in court:

In July 2019, an undercover law enforcement officer conducted an online session using a publicly available peer-to-peer (P2P) program, which allows internet users to trade digital files. During this session, a user shared multiple files of featuring images of child sexual abuse from an internet address traced to Schulenburg’s residence.

On Nov. 6, 2019, law enforcement lawfully obtained a computer from Schulenburg’s residence that contained hundreds of images and videos of child pornography, including images of prepubescent children being sexually abused. 

The count of distribution of child pornography carries a mandatory minimum penalty of 15 years in prison, a maximum penalty of 40 years in prison, and fine of $250,000. The count of possession of child pornography carries a mandatory minimum penalty of 10 years in prison, a maximum penalty of 20 years in prison, and fine of $250,000.

U.S. Attorney Carpenito credited the FBI Newark's Child Exploitation Human Trafficking Task Force, under the direction of FBI Special Agent in Charge Joe Denahan; the Somerset County Prosecutor's Office, under the direction of Prosecutor Michael H. Robertson, and the Bernards Township Police Department, under the direction of Chief Michael Shimsky, with the investigation leading to today’s indictment.

The government is represented by Assistant U.S. Attorney Vijay Dewan of the U.S. Attorney’s Office Criminal Division in Newark.

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

WHEELING, WEST VIRGINIA – Robert Michael Junkins, of Clarksburg, West Virginia, was sentenced today to 300 months of incarceration for drug and firearms charges, U.S. Attorney Bill Powell announced.

In June 2019, a jury deliberated for less than one hour before finding Junkins, age 51, guilty of two counts of “Possession with Intent to Distribute Methamphetamine,” one count of “Possession of a Firearm During and in Relation to a Drug Offense,” and two counts of “Unlawful Possession of a Firearm.” 

Junkins had methamphetamine in his possession on three separate occasions. Having been convicted of a felony drug offense, Junkins also illegally had several firearms and ammunition. The crimes occurred in August and September 2017 and November 2018 in Harrison County.

Assistant U.S. Attorneys Brandon S. Flower and Stephen D. Warner prosecuted the case on behalf of the government. The Bureau of Alcohol, Tobacco, Firearms and Explosives and the Elkins Police Department investigated. 

U.S. District Judge John Preston Bailey presided.

CHICAGO — A former Chicago Police officer was sentenced today to nearly six years in federal prison for fraudulently obtaining search warrants and stealing cash and drugs from properties he searched.

U.S. District Judge Matthew F. Kennelly imposed the 71-month sentence on DAVID SALGADO after a hearing in federal court in Chicago.  Last month, Judge Kennelly sentenced Salgado’s former Chicago Police partner, XAVIER ELIZONDO, to seven years and three months in prison.

The sentences were announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; and Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago office of the FBI.  The Chicago Police Department provided valuable assistance.

Salgado, 39, and Elizondo, 48, both of Chicago, were assigned to a gang team in the Chicago Police Department’s Tenth District.  The officers conspired to submit materially false information to state court judges to fraudulently obtain search warrants that enabled them to enter various properties and seize cash and drugs.  The officers would then steal the items and falsify police reports to conceal the thefts. 

A jury in October 2019 convicted Elizondo and Salgado on all counts against them, including conspiracy to commit theft, deprivation of civil rights, embezzlement, and obstruction of justice. Salgado was also convicted of making a false statement to the FBI.

“The defendants fundamentally betrayed the trust placed in them by the public and the state’s criminal justice system,” Assistant U.S. Attorneys Sean J.B. Franzblau and Ankur Srivastava argued in the government’s joint sentencing memorandum.  “The defendants not only harmed individual victims, but they also impaired the public’s confidence in law enforcement.”

A convicted felon, illegal user of controlled substances, and marijuana grower who unlawfully possessed two guns was sentenced today to a year in federal prison.

Brian Anderson, age 52, from New Hartford, Iowa, received the prison term after a December 9, 2019 guilty plea to being a felon and an unlawful user of controlled substances in possession of a firearm.

Information at sentencing showed that law enforcement searched Anderson’s home in New Hartford in June 2018.  Officers were initially searching the home looking for endangered rattlesnakes that Anderson allegedly possessed.  During the search, officers found the body of one dead rattlesnake.  But officers also found a marijuana grow operation, including over 120 marijuana plants, and two guns nearby.  Anderson was prohibited from possessing guns because he had previously been convicted of the felony offense of manufacturing marijuana and possessing marijuana with the intent to distribute.  He also had a previous conviction for illegally possessing two handguns.   

Anderson was sentenced in Cedar Rapids by United States District Court Judge C.J. Williams.  Anderson was sentenced to 12 months’ and one day in prison.  He must also serve a three-year term of supervised release after the prison term.  There is no parole in the federal system.

This case was brought as part of Project Safe Neighborhoods (PSN).  PSN is the centerpiece of the Department of Justice’s violent crime reduction efforts.  PSN is an evidence-based program proven to be effective at reducing violent crime. 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. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.

The case was prosecuted by Assistant United States Attorney Anthony Morfitt and investigated the Iowa Department of Natural Resources, the Waterloo Police Department, the United States Fish and Wildlife Service, and the Iowa Division of Criminal Investigation.   

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

The case file number is 19-cr-3054.

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A four-person cabal has been charged with plotting a hit on a DEA task force officer, announced U.S. Attorney for the Northern District of Texas Erin Nealy Cox.

A federal grand jury indicted Manuel Garcia Gomez, 22, Jorge Humberto Velazco Larios, 27, Eva Denisse Gomez Garcia, 38, and Alicia Yuritzi Juarez Martinez, 31, for conspiracy to use interstate commerce in the commission of murder-for-hire.

Mr. Gomez and Mr. Larios have been arrested and will make their initial appearances before U.S. Magistrate Judge Renee Toliver this afternoon at 2 p.m. Ms. Garcia and Ms. Martinez remain fugitives and are believed to be in Mexico.

“The Justice Department will not stand for retaliatory violence against officers and agents,” said U.S. Attorney Erin Nealy Cox. “These defendants were plotting to murder a federal task force officer – a man who routinely risks his life to combat the scourge of drugs in our community. We are grateful to our partners at the DEA and FBI who worked tirelessly to keep the officer safe and help bring his would-be killers to justice.”

According to the indictment, unsealed today, Mr. Gomez – who was behind bars at Johnson County Jail on a methamphetamine charge – allegedly told another individual at the jail he wanted to “off” the DEA agent assigned to his case. He set the budget at $20,000: $5,000 up front and $15,000 following the hit.

In a subsequent phone call with an individual outside the jail, Mr. Gomez confirmed he wanted the agent murdered.

Mr. Gomez then called his girlfriend, Ms. Martinez, and his sister, Ms. Garcia, to arrange for delivery of the murder-for-hire fee. He advised them that the co-defendant in his drug case, Mr. Larios, would also contribute to the up-front payment.

Meanwhile, Mr. Larios, also behind bars, called an unindicted co-conspirator and asked him to deliver money to a workshop “so we can take care of something.”

On June 11, the unindicted co-conspirator, referred to in court documents by the nickname “Roberto,” made a $3,000 “down payment” for the murder of the agent. Five days later, he made an additional $2,000 payment on behalf of Mr. Gomez and Mr. Larios.

Mr. Gomez once again called his contact outside the jail. He described the DEA agent he wanted killed, then instructed the individual to call Ms. Martinez and Ms. Garcia, who he said had documents that could help the hit man figure out the name of the target. Mr. Gomez said the women were “badasses” who “know everything that is going on.”

Shortly thereafter, Ms. Garcia received a photo of DEA task force officer “T.H.” via the messaging app, WhatsApp. The following day, she flashed the image during a jailhouse video call with Mr. Gomez.  

“Yes, that’s him,” Mr. Gomez told Ms. Garcia, smiling.

“Drug trafficking is inherently violent and traffickers will stop at nothing to protect their profits and their lifestyle,” said Eduardo A. Chavez, Special Agent in Charge of the DEA Dallas Field Division.  “DEA agents and task force officers constantly put themselves in harm’s way to ensure these individuals are brought to justice. We appreciate our federal partners’ swift efforts to bring accountability to their nefarious intentions.”   

"The Dallas Violent Crime Task Force is dedicated to protecting our citizens. This includes ensuring the safety of our law enforcement partners," said FBI Dallas Special Agent in Charge Matthew DeSarno. "The defendants wanted to harm a DEA task force officer and that is unacceptable. Fortunately, we were able to prevent a dangerous act from occurring and successfully apprehend a group of violent criminals."

An indictment is merely an allegation of criminal conduct, not evidence. Defendants are presumed innocent unless and until proven guilty in a court of law.

If convicted, these defendants face up to 10 years in federal prison. (Had the hit been carried out as planned, they would have faced a possible death sentence or life imprisonment.)

The Federal Bureau of Investigation’s Dallas Field Office, Violent Crime Task Force, conducted the investigation in close collaboration with the Drug Enforcement Administrations’ Dallas Field Division. The Johnson County Sheriff’s Office, U.S. Marshals Service, and U.S. Customs & Border Protection assisted in the investigation. Assistant U.S. Attorney Rick Calvert is handling the prosecution. 

BOSTON – An Ashburnham man pleaded guilty yesterday in federal court in Worcester to selling firearms on three occasions in 2019 in Fitchburg.

Terrick Bishoff, 39, pleaded guilty to one count each of unlawful possession or transfer of a machine gun, dealing in firearms without a license and possession of a machinegun without a serial number. U.S. District Court Judge Timothy J. Hillman scheduled sentencing for Oct. 27, 2020. Bishoff was arrested on Sept. 24, 2019 and indicted in October 2019.

On three separate occasions in 2019, Bishoff sold firearms to an individual he did not know in Fitchburg. On May 10, 2019, Bishoff sold a Glock-style pistol without a serial number and 54 rounds of 9mm ammunition in exchange for $580. Bishoff told the buyer that the firearm was “untraceable” and that it had been custom made for a silencer. On May 15, 2019, Bishoff again met with the buyer and sold him a machinegun without a serial number and a 25 round magazine. In return, the individual paid Bishoff $2,500. On June 24, 2019, Bishoff sold the buyer a Glock-style firearm without a serial number, and a magazine, in exchange for $800. Bishoff told the buyer he was getting what he could before authorities started cracking down on firearms without serial numbers. 

The charge of unlawful possession or transfer of a machine gun provides for a sentence of up to 10 years in prison, three years of supervised release and a fine of $250,000. The charge of dealing in firearms without a license provides for a sentence of up to five years in prison, three years of supervised release and a fine of $250,000. The charge of possession of a machinegun without a serial number provides for a sentence of up to 10 years in prison, three years of supervised release and a fine of $10,000. 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 & Explosives, Boston Field Division; Brian D. Boyle, Special Agent in Charge of the Drug Enforcement Administration, New England Field Division; Colonel Christopher Mason, Superintendent of the Massachusetts State Police; Ashburnham Police Chief Lorring Barrett, Jr.; Worcester Police Chief Steven M. Sargent; and Hopkinton Police Chief Joseph Bennett made the announcement. Assistant U.S. Attorneys Michelle L. Dineen Jerrett and Kristen Noto of Lelling’s Worcester Branch Office are prosecuting the case.

BOSTON – A leader of the Worcester Chapter of the Massachusetts Almighty Latin King and Queen Nation (“Latin Kings”) pleaded guilty today to drug distribution charges.

Alvin Mojica, a/k/a “King Humble,” 32, pleaded guilty to one count of distribution of cocaine. U.S. Senior District Court Judge Rya W. Zobel scheduled sentencing for Oct. 28, 2020.  Mojica was arrested and charged in December 2019, at which time he was the leader of the Worcester based Chapter of the Latin Kings.

During the plea proceedings, Mojica admitted that in May 2019 he distributed just under 14 grams of cocaine to a cooperating witness in an audio/video recorded transaction. 

The Latin Kings are a violent criminal enterprise comprised of thousands of members across the United States. The Latin Kings adhere to a national manifesto, employ an internal judiciary and use a sophisticated system of communication to maintain the hierarchy of the organization. As alleged in court documents, the gang uses drug distribution to generate revenue, and engages in violence against witnesses and rival gangs to further its influence and to protect its turf.

Mojica is the third defendant to plead guilty in the case.

The charge provides for a sentence of up to 20 years in prison, a minimum of three years and up to life of supervised release and a fine of up to $1 million. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.

United States Attorney Andrew E. Lelling; Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; Commissioner Carol Mici of the Massachusetts Department of Correction; and Worcester Police Chief Steven M. Sargent made the announcement today. Valuable assistance was also provided by the FBI North Shore Gang Task Force and the Bristol County and Suffolk County District Attorney’s Offices.  Assistant U.S. Attorney Philip A. Mallard and Mark Grady of Lelling’s Criminal Division are prosecuting the case.

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

BOSTON – The regional president of the Brockton/East Bridgewater Chapters of the Outlaws Motorcycle Club pleaded guilty yesterday to possession of an unregistered firearm.

Bruce Sartwell, a/k/a “Monster,” 48, of East Bridgewater, pleaded guilty to one count of possession of an unregistered firearm and 153 rounds of 5.56 caliber ammunition before U.S. District Court Judge Denise J. Casper, who scheduled sentencing for Nov. 10, 2020. On Oct. 30, 2019, following the execution of a federal search warrant, Sartwell was arrested and charged. 

On Oct. 19, 2019, agents intercepted a package originating in China and addressed to Sartwell that was declared as a “Fuel Filter” but actually contained a firearm silencer. A review of importation records revealed that Sartwell had received approximately 65 shipments from Asia (including over 55 from China), many of which were labeled as innocuous items that could have been more easily and cheaply purchased in the United States. During the investigation, law enforcement determined that Sartwell is the Regional President of the Brockton/East Bridgewater Chapters of the Outlaws Motorcycle Club.

On Oct. 30, 2019, a search was executed at Sartwell’s residence. Twelve or more AR-15 style Air-Soft rifles discovered in Sartwell’s garage were later determined not to be firearms. Hidden in the garage was an AR-15 styled “ghost gun” (a firearm without any manufacturing or serial numbers), two empty 30 round magazines, firearm manufacturing tools, assembly parts including milling equipment, buffer spring, buffer tube and a drill press. The AR-15 was later successfully test fired.

In addition, hidden compartments were located in Sartwell’s bedroom that concealed 153 rounds of 5.56 caliber ammunition compatible with the AR-15 styled rifle, two firearm silencers, a guide for assembly and disassembly of an AR-15 rifle, 20 knives, a black powder handgun and a flare gun. In the basement of the house, a floor-length mirror concealed the entrance to a hidden storage area that was found to contain a safe with silencer parts and a firearm assembly instruction book.

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

United States Attorney Andrew E. Lelling; Michael Shea, Acting Special Agent in Charge of Homeland Security Investigations in Boston; and Kelly Brady, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives, New England Field Division made the announcement today. The U.S. Postal Inspection Service; Customs and Boarder Protection; Massachusetts State Police; East Bridgewater Police Department; Bristol County Sheriff’s Office; and the Massachusetts Environmental Protection Agency provided assistance with the investigation. Assistant U.S. Attorneys Kenneth G. Shine and Linsey Weinstein of Lelling’s Criminal Division are prosecuting the case. 

BOSTON – A Rhode Island man pleaded guilty yesterday in federal court in Boston in connection with a conspiracy to launder funds derived from Business Email Compromise (BEC) fraud schemes, including one that targeted a Dorchester, Mass. real estate attorney.    

Sayon Balogun a/k/a “Oshine,” 32, a dual citizen of the United States and Nigeria, pleaded guilty to one count of money laundering conspiracy before U.S. Senior District Court Judge Douglas P. Woodlock, who scheduled sentencing for Nov. 10, 2020. Balogun was initially charged by criminal complaint on May 31, 2019, and arrested in Florida on June 10, 2019.

In January 2018, Balogun’s co-conspirators gained access to email accounts belonging to a Massachusetts attorney engaged in real estate closings. The co-conspirators then mimicked (spoofed) the real estate attorney’s email account and sent emails to a Massachusetts resident who was the purchaser in a legitimate real estate transaction. The spoofed emails directed the Massachusetts real-estate purchaser to wire transfer $531,981 (which the purchaser believed was for a legitimate real estate transaction) to the Wells Fargo account of a California woman, who in turn sent $60,000 to an account in the name of “David Tecum,” a fraudulent identity used by one of Balogun’s co-conspirators, Oghenetchouwe Adegor Ederaine, Jr. This account, and others, were opened by Ederaine to receive fraudulent proceeds at Balogun’s direction.

Ederaine pleaded guilty to aggravated identity theft and money laundering conspiracy and was sentenced to 40 months in prison.   

The charging statute provides for a sentence of up to 20 years in prison, three years of supervised release, and a fine of $500,000 or twice the value of the funds laundered in the conspiracy. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.

United States Attorney Andrew E. Lelling and Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division made the announcement today. The United States Attorney’s Office and the FBI in the Southern District of Florida provided valuable assistance. Assistant U.S. Attorney David D’Addio of Lelling’s Securities, Financial & Cyber Fraud Unit is prosecuting the case.