NASHVILLE – A criminal complaint unsealed today charged a Franklin, Tennessee couple with an elaborate scheme to defraud an elderly widow of $1.7 million, announced Acting U.S. Attorney Mary Jane Stewart for the Middle District of Tennessee.  FBI agents this morning, arrested Karl Hampton, 63, and his wife, Deborah Hampton, 59, at their home.  Karl Hampton is charged with wire fraud and money laundering and Deborah Hampton is charged with money laundering.  Both will make an initial appearance before a U.S. Magistrate Judge later today.

According to the criminal complaint, Karl Hampton met an elderly widow while he was working as an exterminator for a Belle Meade-based pest control company and provided extermination services for her home from approximately January 2016 through May 2019.

Beginning in approximately January 2018, when the elderly woman was 85 years old,  and continuing until about June 2020, Karl Hampton devised and executed a scheme to defraud the woman and various financial institutions and credit and loan-issuing institutions by deceiving the woman into believing that he was her son or godson and that he would care for her personally and financially.  He then used his influence over her to convince her to sign over her Power of Attorney (POA) and to name him in her Revocable Living Trust (RLT) and in her will.  Karl Hampton methodically drained the woman’s bank accounts, took out a $500,000 line of credit in her name using her securities as collateral, and amassed huge charges on her credit cards for his own personal expenses, all under the false pretenses that he had a valid POA, that he was entitled to her money and property, and that he was acting for her benefit and in her interest.

In April 2019, Karl Hampton accompanied the woman to an attorney’s office, where she signed a POA, a RLT and a will, each of which purported to give Karl Hampton considerable control over her assets.  The POA appointed Karl Hampton as the Agent and Deborah Hampton as the successor agent.  The RLT and the will specified that Karl Hampton and Deborah Hampton would be beneficiaries when the woman died.  In May 2019, shortly after inducing the woman to sign the POA, Karl Hampton quit his job and thereafter continued to drain the woman’s bank accounts to fund his lavish lifestyle.

On June 8, 2019, the woman fell and fractured her hip and was transported to Williamson County Medical Center (WCMC) and then to NHC of Cool Springs (NHC), which was an assisted living facility, for recovery following hip surgery.  During her hospital visit and transfer to NHC, the woman was diagnosed with dementia.  Staff at NHC also noted that the woman was malnourished when she arrived, and staff discussed with Karl Hampton that she suffered from dementia.  Upon the woman’s admission to WCMC and on the application to place her at NHC, Karl Hampton listed himself as her “son,” her trustee, POA, and emergency contact. On other occasions, Karl Hampton called a financial institution, allegedly on the woman’s behalf, and represented that he was her “personal assistant” and another time falsely represented that she was his “mother.” 

In December 2019, Karl Hampton took out a $500,000 line of credit in the woman’s name at SunTrust, using her security accounts at SunTrust as collateral.   Karl Hampton then wrote checks to himself, purchased cashier’s checks, took out cash withdrawals, and transferred money out of the woman’s bank account and into a bank account in the name of Falcon Company, which he set up and controlled.

In January 2020, Karl Hampton used $170,000 of the money from the line of credit to purchase an ownership interest in his own name in a pest control business located in Franklin. Also, in January 2020 Karl Hampton rented an apartment in Murfreesboro, Tennessee, in the woman’s name. By this time, the woman had been living at NHC for almost six months.

During the course of the scheme, Karl Hampton took a total of approximately $1,240,438.06 from the woman’s accounts, and frequently purchased luxury items and often spent between $1,000 and $1,500 per day on lottery tickets.  In February 2019, Karl Hampton and Deborah Hampton purchased a luxury Lexus SUV, using $21,000 of the criminal proceeds.  In January 2020, the Hamptons spent $21,452 on a 4.3-karat diamond ring, also using proceeds of the fraud.

Karl Hampton also liquidated two investment accounts of the woman’s deceased sister in the amount of $246,645 and used the money for his own benefit. 

If convicted, the Karl Hampton faces up to 20 years in prison and Deborah Hampton faces up to 10 years.

This case was investigated by the FBI and is being prosecuted by Assistant U.S. Attorney Kathryn Booth.

A criminal complaint is merely an accusation of guilt. Both defendants are presumed innocent until proven guilty in a court of law.

# # # # #

          SANTA ANA, California– Law enforcement today arrested an employee of a Department of Defense contractor on a criminal complaint alleging he unlawfully sold United States Air Force technical data to an Orange County man who then illegally resold the data to customers.

          Sarfraz Yousuf, 43, of Miramar, Florida, was taken into federal custody this morning. Also arrested today was Marc Chavez, 53, of Trabuco Canyon.

          Yousuf is expected to make his initial appearance in United States District Court in Fort Lauderdale, Florida. Chavez is expected to appear in federal court in Santa Ana. Each man is charged with one count of theft of government property.

          According to an affidavit filed with the complaint, during an investigation into a U.S. Navy employee’s unlawful sale of government-controlled technical drawings to a Newport Beach-based company, Newport Aeronautical Sales Corp. (NASC), law enforcement discovered NASC also illegally obtained U.S. Air Force technical orders from the users of an email account used by Yousuf, an employee of Summit Aerospace Inc., a Miami-based aircraft maintenance company.

          The technical orders at issue in this case are documents that cover installation, operation, maintenance, and handling of Air Force equipment and material, according to the affidavit.

          During the investigation, law enforcement also discovered Chavez illegally acquired Air Force technical orders from Yousuf on behalf of LTC Products, a Trabuco Canyon-based company selling technical aerospace data that Chavez ran out of his home, the affidavit states.

          From January 2015 to July 2020, Chavez allegedly unlawfully acquired at least 1,875 Air Force technical orders from Yousuf in exchange for at least $132,280. Yousuf was not authorized to sell the technical orders and Chavez was not authorized to receive them.

          In June 2020, Yousuf allegedly sold 34 Air Force technical orders to Chavez, including one marked with a distribution statement reserved for “technical data of such military significance that release…may jeopardize an important technological or operational military advantage of the United States” and containing overhaul instructions related to a “Rate Gyro Assembly Flight Control,” for $2,170. Chavez allegedly resold the orders to customers for a profit.

          If convicted, the defendants would face a statutory maximum sentence of 10 years in federal prison.

          A complaint contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

          In a related case, Mark Fitting, 54, of Berlin, New Jersey, an engineer employed by the Navy at a facility in Philadelphia, pleaded guilty in December 2020 to one count of conspiracy to steal government property and one count of aiding and abetting the theft of government property. Fitting admitted in his plea agreement that he downloaded technical drawings and manuals related to U.S. military weapons systems and sold the items to NASC, which later resold the documents to domestic and foreign customers. Fitting’s sentencing hearing is scheduled for October 18 in Santa Ana.

          This case is being investigated by the Defense Criminal Investigative Service; the Naval Criminal Investigative Service; Homeland Security Investigations; the Department of Commerce, Bureau of Industry and Security, Office of Export Enforcement; U.S. Air Force Office of Special Investigations; and U.S. Army Criminal Investigation Command.

          Assistant United States Attorney Keith D. Ellison of the International Narcotics, Money Laundering, and Racketeering Section is prosecuting this case.

Jackson, Miss. - A Philadelphia man was sentenced today to 189 months in federal prison for possession with intent to distribute methamphetamine, announced Acting U.S. Attorney Darren J. LaMarca of the Southern District of Mississippi and Jack P. Stanton, Acting Special Agent in Charge of Homeland Security Investigations’ New Orleans Field Office.

According to court documents, Landon Marquale Dupree, 35, of Philadelphia, Mississippi, was  charged with and pled guilty to selling methamphetamine to an individual on July 15, 2019, in Philadelphia.  Dupree was sentenced to serve 189 months in the custody of the Bureau of Prisons, to be followed by 8 years of supervised release. He was also ordered to pay $4595.00 in restitution to the Mississippi Bureau of Narcotics.

Dupree has a prior felony conviction for sale of cocaine in Neshoba County, Mississippi.

This prosecution is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles the highest-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten the United States by using a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.

The case is part of a joint investigation by the United States Immigration, Customs Enforcement, Homeland Security Investigations and Mississippi Bureau of Narcotics, with assistance from US Drug Enforcement Administration, Bureau of Alcohol, Tobacco, Firearms and Explosives, Philadelphia Police Department, Neshoba County Sheriff’s Department, Neshoba County District Attorney’s Office, Scott County Sheriff’s Office, Flowood Police Department, Rankin County Sheriff’s Department, Hinds County Sheriff’s Department, Carthage Police Department, Union Police Department, Louisville Police Department, and Mississippi Highway Patrol. The case is being prosecuted by Assistant United States Attorney Erin Chalk.

BOSTON – A former senior executive at TPG Capital, a global private equity firm, was sentenced today in connection with his involvement in the college admissions case. 

William E. McGlashan, Jr., 57, was sentenced by U.S. District Court Judge Nathaniel M. Gorton to three months in prison, two years of supervised release, a fine of $250,000 and 250 hours of community service. On Feb. 10, 2021, McGlashan agreed to plead guilty to one count of wire fraud and honest services wire fraud.

In 2017, McGlashan, the former managing partner of TPG Growth and co-founder of The Rise Fund, agreed to pay co-conspirator William “Rick” Singer to bribe Igor Dvorskiy, a corrupt test administrator, to allow Mark Riddell, a corrupt test “proctor,” to secretly correct McGlashan’s son’s ACT exam answers to obtain a fraudulently inflated score. As a result, McGlashan’s son received a fraudulent ACT score of 34. McGlashan made a purported donation of $50,000 from his personal charitable donation fund to Singer’s sham charity. In turn, Singer paid Dvorskiy and Riddell.

Singer, Dvorskiy, and Riddell have pleaded guilty for their respective roles in the scheme.

Case information, including the status of each defendant, charging documents and plea agreements are available here: https://www.justice.gov/usao-ma/investigations-college-admissions-and-testing-bribery-scheme.

Acting United States Attorney Nathaniel R. Mendell; Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; Ramsey E. Covington, Acting Special Agent in Charge of the Internal Revenue Service’s Criminal Investigations in Boston; and Mark Deckett, Resident Agent in Charge of the Department of Education, Office of Inspector General made the announcement today. Assistant U.S. Attorneys Justin D. O’Connell, Leslie A. Wright, Kristen A. Kearney, Karin M. Bell and Stephen E. Frank of Mendell’s Criminal Division prosecuted the case.

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

Audrey Strauss, the United States Attorney for the Southern District of New York, and William F. Sweeney Jr., the Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced today that ELLIOTT SMERLING was indicted this morning on charges of wire fraud, bank fraud, and aggravated identity theft for seeking and obtaining an approximately $95 million subscription-backed line of credit for his $500 million private equity fund on the basis of a forged audit letter, falsified subscription agreements, and falsified bank account statements.

Manhattan U.S. Attorney Audrey Strauss said:  “As alleged, Elliot Smerling went to elaborate measures to create a blatantly false picture of the financial underpinnings of a private equity fund in order to obtain a $95 million line of credit.  Through a forged audit letter and falsified subscription agreements and bank statements, Smerling allegedly induced a California bank to make a loan commitment it never would have made had it known the truth.  Now, the truth has landed Elliot Smerling in federal court.”

FBI Assistant Director William F. Sweeney Jr. said:  “Falsifying information in order to secure a loan, regardless of the amount, is a crime.  When the loan secured is nearly $100 million, the stakes are even higher.  As alleged, Smerling engaged in illegal practices in order to benefit his interests.  Today he’s learned the consequences of his alleged actions.”

According to the Indictment filed today in Manhattan federal court, and the Complaint[1] unsealed February 26, 2021, in the Southern District of Florida:

From at least in or about December 2020 through at least in or about February 2021, ELLIOT SMERLING, the defendant, solicited and obtained on behalf of the general partner (“General Partnership-1”) of a private equity fund (“Private Equity Fund-1”), a loan of approximately $95 million from a commercial bank headquartered in California (“Victim Bank-1”), which was secured by purported capital commitments made by the limited partnership of investors in Private Equity Fund-1 (“Limited Partnership-1”).  SMERLING obtained the approximately $95 million loan on the basis of falsified documents and material misrepresentations, including:  (1) a forged audit letter, purportedly prepared by an international network of accounting, audit, tax, and professional services firms (“Audit Firm-1”), attesting to the audited financial statements of Limited Partnership-1; (2) forged subscription agreements that falsely represented that the investment fund of a private university based in New York, New York (“University Endowment Fund-1”), and the chief investment officer of that fund (“Chief Investment Officer-1”) had committed $45 million to fund Limited Partnership-1, and that the investment management division of a banking and financial services firm headquartered in New York, New York (“Investment Manager-1”), and the chief executive officer of Investment Manager-1 had committed $40 million to fund Limited Partnership-1; and (3) falsified bank records purporting to attest to a $4.5 million wire transfer from University Endowment Fund-1 to Limited Partnership-1. 

On or around December 1, 2020, SMERLING contacted an employee of Victim Bank-1 concerning SMERLING’s interest in acquiring an approximately $95 million loan for SMERLING’s $500 million private equity fund, Limited Partnership-1.  The loan sought by SMERLING would substitute for an existing line of credit SMERLING had secured from a multinational financial services company (“Commercial Bank-1”), where Limited Partnership-1 purported to have an existing line of credit with an outstanding loan balance equal to the amount sought by SMERLING from Victim Bank-1.  The employee of Victim Bank-1 referred SMERLING to a director in the Global Fund Banking Group at Victim Bank-1 (“Witness-1”).

Thereafter, in or around December 2020, Witness-1 requested from SMERLING materials concerning Limited Partnership-1 and General Partnership-1 in order to evaluate SMERLING’s loan request.  In response, SMERLING sent Victim Bank-1 materially false materials, the veracity of which Victim Bank-1 relied upon in ultimately deciding to make the loan sought by SMERLING, including:     

i.          An audit letter (the “Audit Letter”), purportedly prepared by Audit Firm-1, attesting to the sound finances of Limited Partnership-1.

ii.         Subscription agreements purportedly signed by investors in the fund, including an agreement reflecting a purported commitment of $45 million by University Endowment Fund-1 and the purported signature of Chief Investment Officer-1 (“Subscription Agreement-1”), and an agreement reflecting a purported commitment of $40 million by Investment Manager-1 and the purported signature of the chief executive officer of Investment Manager-1 (“Subscription Agreement-2”).  

iii.        A table (the “Capital Commitment Table”) listing $500 million in paid and unpaid capital commitments purportedly made to Limited Partnership-1 as of December 13, 2019, including a purported $45 million commitment by University Endowment Fund-1, consisting of a “call amount” of $4.5 million and an “unpaid commitment” of $40.5 million as of that date, as well as a purported $40 million commitment by Investment Manager-1, consisting of a “call amount” of $4 million and an “unpaid commitment” of $36 million as of that date. 

Following receipt of the materials, employees of Victim Bank-1, including at least one employee based in Victim Bank-1’s office in New York, New York, reviewed the materials as part of Victim Bank-1’s diligence process.

On or around January 7, 2021, Witness-1 wrote an email to the chief financial officer of Private Equity Fund-1, with a copy to SMERLING, in which Witness-1, in substance and in part, advised that Victim Bank-1 was in the process of finalizing its approvals for the loan.  Witness-1 requested bank statements “evidencing receipt of the most recent capital call.”  On the same date, SMERLING replied with an email to which he attached a December 2019 bank statement (the “Bank Statement”) for an account purportedly held in the name of Limited Partnership-1 at Commercial Bank-1’s Americas headquarters in New York, New York.  The statement reflected wires into the account with a combined value of $50 million, including a purported wire of $4.5 million from University Endowment Fund-1 and a purported wire of $4 million from Investment Manager-1.

The materials that SMERLING submitted to Victim-Bank-1 were materially false.  For example, the Audit Letter was not prepared by Audit Firm-1.  Chief Investment Officer-1 of the University Endowment Fund-1 has no knowledge of ELLIOT SMERLING, Limited Partnership-1, or General Partnership-1, and the signature appearing on the Subscription Agreement-1 is not that of Chief Investment Officer-1.  University Endowment Fund-1 has found no indication that it made the $4.5 million wire transfer reflected in the Bank Statement or made any other investment or capital commitment to ELLIOT SMERLING, the defendant, Limited Partnership-1, or General Partnership-1.

Similarly, Investment Manager-1 has found no indication that Investment Manager-1 in fact made the $4 million wire transfer reflected in the Bank Statement or made any other investment or capital commitment to ELLIOT SMERLING, the defendant, Limited Partnership-1, or General Partnership-1.

SMERLING was arrested and presented in the Southern District of Florida on February 26, 2021, before United States Magistrate Judge William Matthewman.

*                      *                      *

SMERLING, 52, of Lake Worth, Florida, is charged in three counts, with wire fraud, bank fraud, and aggravated identity theft.  Wire fraud affecting a financial institution carries a maximum sentence of 30 years in prison, and a maximum fine of $1 million or twice the gross gain or loss from the offense.  Bank fraud carries a maximum sentence of 30 years in prison, and a maximum fine of $1 million or twice the gross gain or loss from the offense.  Aggravated identity theft carries a mandatory sentence of two years in prison consecutive to any other sentence imposed and a maximum fine of $250,000 or twice the gross gain or loss from the offense.  The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.

Ms. Strauss praised the work of the Federal Bureau of Investigation. 

This case is being handled by the Office’s Complex Frauds and Cybercrime Unit.  Assistant U.S. Attorney Jilan J. Kamal and Timothy V. Capozzi are in charge of the prosecution. 

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

          LOS ANGELES– Three members of the Rollin’ 30s Crips street gang have been arrested on a federal criminal complaint alleging they committed an armed robbery at a Beverly Hills restaurant’s crowded outdoor dining area on March 4 in which one restaurant patron was held at gunpoint and another was shot and wounded.

          The complaint, which was unsealed on Tuesday, charges the following three men – all South Los Angeles residents and documented members of the Rollin’ 30s Crips – with one count of conspiracy to interfere with commerce by robbery:

• Malik Lamont Powell, 20;
• Khai McGhee, a.k.a. “Cameron Smith,” 18; and
• Marquise Anthony Gardon, 30.

          The defendants were arrested on Tuesday and are expected to make their initial appearances this afternoon in United States District Court in downtown Los Angeles.

          According to an affidavit filed with the complaint, during the afternoon of March 4, an armed robbery occurred at Il Pastaio restaurant in Beverly Hills. During the robbery, a restaurant patron was held at gunpoint while he was robbed by three men for his Richard Mille wristwatch, worth approximately $500,000. A struggle for the gun ensued, during which approximately two rounds were discharged from the firearm, striking another restaurant patron in the leg. Ultimately, the handgun was dropped to the ground during the struggle with the victim. The robbers fled the scene with the victim’s watch.

          Based on a review of video surveillance footage and witness statements, a total of five individuals are believed to be involved in the robbery crew that committed this robbery, the affidavit states. Law enforcement has identified Powell and McGhee as two of the three robbers, and Gardon has been identified as a driver of the robbery crew’s getaway car, according to the affidavit.

          Powell’s car – a black BMW – allegedly was used to transport the robbery crew to and from the robbery, and his cell phone allegedly was present near Il Pastaio at the time of the robbery. Powell’s social media accounts allegedly contained images of various guns and high-value wristwatches.

          McGhee’s DNA was found on the robbery victim’s clothing following the struggle for the gun, the affidavit states. Surveillance camera footage allegedly shows Gardon getting out of the rear passenger seat and into the driver’s seat of the getaway car just before the robbery at Il Pastaio, and his cell phone was present near the restaurant at the time of the robbery.

          Surveillance camera footage allegedly shows the robbers scouting the area prior to the robbery.

          If convicted, the defendants would face a statutory maximum sentence of 20 years in federal prison.

          A complaint contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

          The FBI and the Beverly Hills Police Department investigated this matter with the Santa Monica Police Department providing assistance.

          Assistant United States Attorneys Joseph D. Axelrad and Jeffrey M. Chemerinsky of the Violent and Organized Crime Section are prosecuting this case.

            WASHINGTON – Folashade Adufe Horne, 52, of Laurel, Maryland, was sentenced today to 13 months in prison for defrauding the D.C. Medicaid program out of more than $370,000.

            The announcement was made by Acting U.S. Attorney Channing D. Phillips; James A. Dawson, Special Agent in Charge, FBI Washington Field Office, Criminal Division; Maureen R. Dixon, Special Agent in Charge of the U.S. Department of Health and Human Services’ Office of Inspector General for the region that includes Washington, D.C.; and Daniel W. Lucas, Inspector General for the District of Columbia.

            In February, Horne pled guilty to health care fraud in the United States District Court for the District of Columbia. The Honorable Reggie B. Walton, who presided over her plea hearing, imposed the 13-month sentence. Judge Walton also ordered Horne to pay $373,564 in restitution and a $267,567 forfeiture money judgment.

            At various times between January 2014 and June 2020, Horne was employed by four different home health agencies to serve as a personal care aide for D.C. Medicaid beneficiaries. Horne also was employed full-time by Howard University Hospital during this same period. The home health agencies employed Horne to assist Medicaid beneficiaries in performing activities of daily living, such as getting in and out of bed, bathing, dressing, and eating. Horne was supposed to document the care she provided to the Medicaid beneficiaries on timesheets and then submit the timesheets to the home health agencies, which would in turn bill Medicaid for the services that she rendered.

            Horne acknowledged that between January 2014 and June 2020, she caused the D.C. Medicaid Program to issue payments totaling $373,564 for services that she did not render. As part of her fraud scheme, she submitted false timesheets to different home health agencies purporting that she provided personal care aide services that she did not provide. She claimed she provided such services during times when she actually was working her shift as a full-time employee at Howard. She claimed to work more than twenty hours in a given day on more than 200 occasions, including 28 days when she asserted that she provided 32 hours of PCA services. She also claimed to provide personal care aide services in the District of Columbia on days when she was not even in the United States.

            The FBI, the Department of Health and Human Services’ Office of Inspector General, the District of Columbia’s Office of the Inspector General’s Medicaid Fraud Control Unit, and the U.S. Attorney’s Office are committed to investigating and prosecuting individuals who defraud the D.C. Medicaid program. Since October 2019, six former personal care aides have been sentenced in U.S. District Court for defrauding Medicaid. A seventh former personal care aide, Charlotte Etongwe, is scheduled to be sentenced next week. Cases against two other personal care aides remain outstanding. 

            The government counts on the public for tips and assistance in helping stop health care fraud. If you have information about individuals committing health care fraud, please call the Department of Health and Human Services’ Office of Inspector General hotline at (800) HHS‑TIPS [(800) 447-8477].

            Assistant U.S. Attorney Kondi Kleinman of the Fraud Section prosecuted the case.

CHARLOTTE, N.C. – U.S. District Judge Robert J. Conrad handed down a 20-year prison term today to Joseph Craig Rabon, 37, of Monroe, N.C., for possession and receipt of child pornography, announced William T. Stetzer, Acting U.S. Attorney for the Western District of North Carolina. Rabon will also have to serve 30 years under supervised release and register as a sex offender after his term of incarceration.

Robert R. Wells, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, joins Acting U.S. Attorney Stetzer in making today’s announcement.

According to court filings, plea documents and statements made in court at today’s sentencing hearing, in August 2016, the FBI became aware that Rabon was using the internet to download child pornography. Court records show that Rabon used peer to peer software to access images and videos depicting the sexual abuse of children, including images portraying sadistic conduct and children under the age of 12. A forensic analysis of Rabon’s seized electronic devices revealed that he possessed more than 30 images and videos of child pornography.

Rabon was indicted by a federal grand jury in November 2018 and was subsequently released on bond. Court records show that, while on pretrial release, Rabon attempted to access and view pornography on the internet multiple times in violation of the Court’s terms and conditions of release. Court records also show that, after Rabon was taken into custody following his guilty plea, a minor victim came forward to report sexual abuse by Rabon over a five year period, which resulted in Rabon’s enhanced term of imprisonment today.

Rabon is currently in custody and will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility. 

In making today’s announcement, Acting U.S. Attorney Stetzer thanked the FBI for their investigation of this case.

Assistant U.S. Attorney Alfredo De La Rosa, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.

This case was brought as part of Project Safe Childhood, a nationwide initiative launched in 2006 by the Department of Justice, aimed at combating the growing online sexual exploitation of children.  By combining resources, federal, state and local agencies are better able to locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue those victims.  For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.

DETROIT– Acting United States Attorney Saima S. Mohsin announced that U.S. District Judge David Lawson has issued an order today appointing Neil Barofsky to be the Independent Monitor over the United Auto Workers Union (UAW) pursuant to the terms of the Consent Decree entered by the Court.

U.S. District Judge Lawson has previously entered a Consent Decree following the filing by the United States of an anti-corruption and anti-fraud civil lawsuit against the UAW in federal district court seeking equitable relief to bring about reform and oversight of the union.  Under the Consent Decree, the United States proposed attorney Neil Barofsky to act as the Independent Monitor providing oversight of the UAW for a period of six years.  The Monitor has the power to oversee the operations of the UAW, to investigate possible fraud or corruption within the union, and to impose discipline on UAW officers and members before an Independent Adjudications Officer also appointed by the Court.  The Monitor will oversee, in conjunction with the Department of Labor, a binding and secret-ballot referendum of the UAW’s membership to determine whether to change the UAW’s election method from the current delegate system to a direct election model, also known as “one member, one vote,” where the entire UAW membership could vote for the UAW President and the other members of the UAW’s International Executive Board.  The referendum will take place within six months of today. 

Neil Barofsky is a partner at the law firm of Jenner & Block, where he leads the firm’s monitorship practice.  Mr. Barofsky was a federal prosecutor for thirteen years in the Southern District of New York.  Mr. Barofsky was also appointed and served as the Special Inspector General for the Troubled Asset Relief Program, an anti-fraud investigative agency that Mr. Barofsky built from scratch.  In addition, Mr. Barofsky has previously served as the Independent Monitor of Credit Suisse Securities LLC and Credit Suisse AG, following billion dollar settlements.  Mr. Barofsky’s team includes Jenner & Block partner Reid J. Schar, who previously served as a federal prosecutor in Chicago, where he prosecuted former Illinois Governor Rod Blagojevich.  Mr. Barofsky will also be assisted by Glen McGorty, a partner in the law firm of Crowell & Moring and a former federal prosecutor.  Mr. McGorty has served as the Independent Monitor overseeing the New York City District Council of Carpenters labor union, which included oversight of direct union elections.          

“The men and women of the UAW deserve honest and faithful leaders dedicated to serving the best interests of the membership,” said Acting U.S. Attorney Mohsin.  “We believe that oversight by an Independent Monitor will help to ensure that the rights and interests of the UAW’s membership are protected.  I am confident that Neil Barofsky will provide tough but fair oversight of the UAW.”   

CHARLOTTE, N.C. – Reggie Pettus, 25, of Charlotte, was sentenced today to nine years in prison and three years of supervised release for possession of a firearm by a felon, announced William T. Stetzer, Acting U.S. Attorney for the Western District of North Carolina.

Vincent C. Pallozzi, Special Agent in Charge of the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Charlotte Field Division, and Chief Johnny Jennings of the Charlotte-Mecklenburg Police Department join Acting U.S. Attorney Stetzer in making today’s announcement.

According to filed court documents and today’s sentencing hearing, in the early morning hours on September 18, 2019, Pettus approached a victim, identified in court documents as “MDS,” in front of the Epicenter in Charlotte, and took the victim’s gold chain from around his neck. At the time of the robbery, Pettus was in possession of a KelTec .380 caliber handgun. Law enforcement later determined the firearm had been stolen in Broward County, Florida. As described in court documents, MDS chased Pettus in an attempt to retrieve his necklace. Following a brief fight with the victim, Pettus brandished the stolen firearm and ran away.  According to court documents, sometime soon thereafter, the victim saw Pettus on the street and shouted at him. Pettus fired three shots at the victim using the stolen firearm and then ran into the Epicenter garage. CMPD officers responding to the incident arrested Pettus after the victim saw Pettus again walking near the Epicenter and identified him as the person who had stolen his necklace.

Pettus is currently in custody and will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility. 

In making today’s announcement, Acting U.S. Attorney Stetzer thanked the ATF and CMPD for their investigation of this case.

Assistant U.S. Attorney Michael Savage, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.

AUGUSTA, GA:  A U.S. Army soldier training at Fort Gordon has admitted to possessing child pornography.

Bryan S. Stills, 26, of Fort Gordon, pled guilty in U.S. District Court to one count of Possession of Child Pornography, said David H. Estes, Acting U.S. Attorney for the Southern District of Georgia. The plea subjects Stills to a statutory penalty of up to 20 years in federal prison and substantial financial penalties, followed by a period of supervised release of five years to life. There is no parole in the federal system.

“Identifying and removing child predators is an important part of keeping our communities safe,” said Acting U.S. Attorney Estes. “We applaud our law enforcement partners for their continued efforts to find those who prey on the most vulnerable members of our society.”

As described in court documents and testimony, the National Center for Missing and Exploited Children (NCMEC) alerted investigators from the U.S. Army Criminal Investigation Command (CID) after detecting child pornography being saved to an email account. Investigators identified the source as Stills, a Private Second Class in training at Fort Gordon with the 369^th Signal Battalion, and in an October 2019 search of his living quarters seized electronic devices with hundreds of images and videos of child pornography.

Stills is in custody while awaiting sentencing.

“U.S. Army Criminal Investigation Command will continue to actively pursue soldiers who engage in this heinous crime regardless of where they are in the world,” said Edward LaBarge, Director of the Major Cybercrime Unit, U.S. Army CID.

The case is being investigated by the U.S. Army Criminal Investigation Command, and prosecuted for the United States by Assistant U.S. Attorney and Project Safe Childhood Coordinator Tara M. Lyons.

ALEXANDRIA, Va. – A Utica, New York man pleaded guilty yesterday to charges relating to his sale of over $1.2 million in opioid pills and counterfeit U.S. currency on multiple dark web criminal marketplaces.

According to court documents, from around October 2016 through February 2021, Albie Pagan, 65, operated under the moniker H00k3d on various dark web markets, including AlphaBay, Apollon, Avaris, Cryptonia, Dark Market, Darkode, Dream, Nightmare, and Wall Street. Pagan, as H00k3d, advertised prescription opioids and medications for sale, including oxycodone, hydromorphone, hydrocodone, and Adderall, as well as counterfeit $10 and $20 bills. Pagan mailed these online-purchased narcotics and counterfeit currency to individuals across the country.

“The defendant illegally distributed over $1.2 million of highly addictive opioids and counterfeit currency while attempting to operate anonymously on dark web marketplaces,” said Raj Parekh, Acting U.S. Attorney for the Eastern District of Virginia. “Those who seek to profit by using the dark web to fuel a devastating opioid crisis that has ravaged our communities will be found and brought to justice.”

On Wall Street alone, Pagan sold over $325,000 in counterfeit U.S. currency, and his gross proceeds for the sale of narcotics and counterfeit currency was at least $1,011,079. On AlphaBay, Pagan’s gross proceeds for narcotics sales was at least $90,399. A review of H00k3d’s sales on Dark Market revealed 475 voluntary customer-rated orders reflecting purchases for several illicit items, including 3,293 hydrocodone, 2,250 oxycodone, and 382 hydromorphone pills. On Dark Market, Pagan’s gross proceeds for narcotics and counterfeit currency exceeded $131,948 based on reviewed transactions.

Pagan pleaded guilty to distribution of controlled substances and selling counterfeit currency. He is scheduled to be sentenced on August 24 and faces a maximum penalty of 20 years in prison. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.

Raj Parekh, Acting U.S. Attorney for the Eastern District of Virginia; James A. Dawson, Special Agent in Charge of the FBI’s Washington Field Office Criminal Division; Peter R. Rendina, Inspector in Charge of the Washington Division of the U.S. Postal Inspection Service; and Matthew S. Miller, Special Agent in Charge of the U.S. Secret Service’s Washington Field Office, made the announcement after U.S. District Judge Leonie M. Brinkema accepted the plea.

Assistant U.S. Attorney Bibeane Metsch is prosecuting the case.

This investigation was conducted by the FBI Washington Field Office’s Hi-Tech Opioid Task Force, which is composed of FBI agents and task force partners, including special agents and officers of the Food and Drug Administration’s Office of Criminal Investigations, DEA, U.S. Postal Inspection Service, and detectives from local assisting police agencies. The task force is charged with identifying and investigating the most egregious Dark Web marketplaces, and the vendors operating on the marketplaces who are engaged in the illegal acquisition and distribution of controlled substances, to include fentanyl, methamphetamine, and other opioids.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:21-cr-95.

Audrey Strauss, the United States Attorney for the Southern District of New York, John C. Demers, Assistant Attorney General for National Security, William F. Sweeney Jr., the Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), and Dermot Shea, the Commissioner of the Police Department for the City of New York (“NYPD”), announced that ZACHARY CLARK, a/k/a “Umar Kabir,” a/k/a “Umar Shishani,” a/k/a “Abu Talha,” was sentenced today to 20 years in prison, for attempting to provide material support to the Islamic State of Iraq and al-Sham (“ISIS”).  CLARK pled guilty on August 10, 2020, in Manhattan federal court before U.S. District Judge Naomi Reice Buchwald, who sentenced Clark today.

U.S. Attorney Audrey Strauss said:  “Zachary Clark pledged allegiance to ISIS and posted calls for attacks on the public and institutions in New York City on encrypted pro-ISIS chatrooms, along with detailed instructions for carrying out those violent acts.  Thanks to the Joint Terrorism Task Force, Clark’s efforts to incite deadly violence on behalf of ISIS have been silenced.  Today’s sentence sends a clear message that those who seek to further ISIS’s campaign of terror and violence, no matter the method, will face serious consequences.”

Assistant Attorney General John C. Demers said:  “Today’s 20-year sentence recognizes the gravity of Clark’s conduct, including his calls for other ISIS supporters to carry out lone wolf terrorist attacks in New York City. Having pledged allegiance to ISIS, Clark provided others with specific instructions on knifing and bomb-making for use in such attacks. We remain vigilant to the threat of terrorism and committed to identifying and holding accountable those who threaten our communities through their support for foreign terrorist organizations.”

FBI Assistant Director William F. Sweeney Jr. said:  “Zachary Clark will no longer spend his time in chat rooms supporting terrorist ideals, but behind bars in federal prison for the next 20 years. The successful ending in this case is a result of the dedication of the FBI’s JTTF here in New York and our partners around the world. We will continue to work together to protect the people of New York from anyone who wishes to do us harm.”

NYPD Commissioner Dermot Shea said:  “Zachary Clark, using encrypted social media platforms became the facilitator for the voice of ISIS in America. He controlled a private channel, communicating with ISIS followers, posting terrorist attack manuals and bomb making instructions and making statements in support of suicide attacks. He also affirmed his own ambitions of becoming a martyr for ISIS on US soil. His arrest comes out of the tight-knit partnership of the Joint Terrorism Task force agents and detectives as well as the NYPD’s Intelligence Bureau. It is another example---among many---of protecting New York City from terrorist violence through intelligence sharing, joint investigation, and prosecution, which results in prevention.”

According to the Indictment, Complaint, other court filings, and statements made during court proceedings:

CLARK pledged allegiance to ISIS twice, first in July 2019, to ISIS’s then-leader Abu Bakr al-Baghdadi, and then in October 2019, to ISIS’s new leader, Abu Ibrahim al-Sashemi al-Qurayshi, whom ISIS promoted after al-Baghdadi’s death.  Beginning in at least March 2019, CLARK disseminated ISIS propaganda through, among other avenues, encrypted chatrooms intended for members, associates, supporters, and potential recruits of ISIS.  CLARK’s propaganda included, among other things, calls for ISIS supporters to commit lone wolf attacks in New York City.  For example, on August 3, 2019, CLARK posted instructions about how to conduct such an attack, including directions on how to select an attack target, how to conduct preoperational surveillance, how to conduct operational planning, and how to avoid attracting law enforcement attention when preparing for and conducting the attack.  On another occasion, CLARK posted a manual entitled “Knife Attacks,” which stated, among other things, that discomfort at “the thought of plunging a sharp object into another person’s flesh” is “never an excuse for abandoning jihad” and that “[k]nives, though certainly not the only weapon for inflicting harm upon the kuffar [non-believers], are widely available in every land and thus readily accessible.”  CLARK urged the participants in encrypted chatrooms to attack specific targets, posting maps and images of the New York City subway system and encouraging ISIS supporters to attack those locations.  CLARK’s guidance also included posting a manual entitled “Make a bomb in the kitchen of your Mom,” which was issued by al-Qaeda in the Arabian Peninsula and included detailed instructions about constructing bombs using readily available materials.    

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In addition to his prison sentence, CLARK, 42, of Brooklyn, New York, was sentenced to lifetime supervised release.  

Ms. Strauss praised the outstanding efforts of the FBI’s New York Joint Terrorism Task Force, which consists of investigators and analysts from the FBI, the NYPD, and over 50 other federal, state, and local agencies.  Ms. Strauss also thanked the Counterterrorism Section of the Department of Justice’s National Security Division.

This prosecution is being handled by the Office’s Terrorism and International Narcotics Unit.  Assistant U.S. Attorneys Gillian Grossman, Matthew Hellman, and Sidhardha Kamaraju are in charge of the prosecution, with assistance from Trial Attorneys Jason Denney, Justin Sher, and Chad Davis of the National Security Division’s Counterterrorism Section.

ST. LOUIS – United States District Judge Henry E. Autrey sentenced Marcus Mays to 37 months in prison today. The 37-year-old Canton, Missouri resident pleaded guilty to one count of being a felon in possession of a firearm.

On August 17, 2018, the Lewis County Sheriff’s Department was investigating Mays. The sheriff’s department obtained a search warrant for Mays’ residence to look for items related to child abuse and drugs. During the execution of the warrant, the sheriff’s department found two stolen firearms, a box of 9mm ammunition, a box of sandwich baggies, two bags containing methamphetamine, marijuana and $1,100 in U.S. Currency in an ottoman in the living room.

Prior to August 17, 2018, Mays was convicted of at least one felony crime punishable by imprisonment for a term exceeding one year.

The Lewis County Sheriff’s Department investigated the case. Assistant United States Attorney J. Christian Goeke is handling the case.

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MADISON, WIS. – A Dane County man is charged with 2 counts of distributing child pornography in an indictment returned today by a federal grand jury sitting in Madison, according to Timothy M. O’Shea, Acting United States Attorney for the Western District of Wisconsin.

Brett Blomme, 40, Cottage Grove, Wisconsin, is charged with 2 counts of distributing a visual depiction of a minor engaging in sexually explicit conduct.  The indictment alleges that on October 30 and November 1, 2020, Blomme sent a file containing an image of child pornography to another user via Kik Messenger.

At the time of the offenses alleged in the indictment, Blomme was a judge with the Milwaukee County Children’s Court. 

If convicted, Blomme faces a mandatory minimum penalty of 5 years and a maximum of 20 years in federal prison on each count. 

The charges against him are the result of an investigation by the Wisconsin Department of Justice Division of Criminal Investigation.  Assistant U.S. Attorney Chadwick Elgersma is handling the prosecution. 

You are advised that a charge is merely an accusation and that a defendant is presumed innocent until and unless proven guilty.

Leonard C Boyle, Acting United States Attorney for the District of Connecticut, and David Sundberg, Special Agent in Charge of the New Haven Division of the Federal Bureau of Investigation, announced that MATTHEW O. CLASON, 39, of Cheshire, waived his right to be indicted and pleaded guilty today before U.S. District Judge Michael P. Shea in Hartford to one count of wire fraud related to his misappropriation of more than $600,000 from an investment client.

According to court documents and statements made in court, Clason was an investment advisor and a registered representative of Lincoln Financial Advisors Corporation, and then LPL Financial LLC.  Beginning in approximately 2015, Clason provided investment services to a 73-year-old Connecticut resident (“the victim”).  The victim had at least five investments accounts with Clason and, in January 2018, Clason and the victim opened a joint bank account.  From 2018 to August 2020, Clason transferred more than $668,000 from the victim’s investment accounts into the joint bank account and, without the victim’s knowledge or authorization, withdrew more than $621,000 in cash from the bank account for his personal use. Clason also transferred $5,000 directly from the joint bank account to his personal bank account, and made two transfers from the joint bank account to pay his personal credit card.

Judge Shea scheduled sentencing for August 5, 2021, at which time Clason faces a maximum term of imprisonment of 20 years.  As part of his plea, he has agreed to pay restitution of at least $639,380 to the victim.

Clason is released on bond pending sentencing.       

This matter is being investigated by the Federal Bureau of Investigation and prosecuted by Assistant U.S. Attorney Heather L. Cherry.

The Justice Department has established a National Elder Fraud Hotline to provide services to seniors who may be victims of financial fraud.  The Hotline is staffed by experienced case managers who can provide personalized support to callers.  Case managers assist callers with reporting the suspected fraud to relevant agencies and by providing resources and referrals to other appropriate services as needed.  When applicable, case managers will complete a complaint form with the Federal Bureau of Investigation Internet Crime Complaint Center (IC3) for Internet-facilitated crimes and submit a consumer complaint to the Federal Trade Commission on behalf of the caller.  The Hotline’s toll-free number is 833-FRAUD-11 (833-372-8311).

PHILADELPHIA – Acting United States Attorney Jennifer Arbittier Williams announced that Jonnel Perkins, 43, of Philadelphia, PA, pleaded guilty to the charge of embezzlement by a bank employee.

According to court documents filed today, the defendant was employed as a Retail Relationship Banker at a bank located in Philadelphia. While she was employed in this position, the Social Security Administration (SSA) conducted a routine audit which identified that a customer of the bank branch where Perkins worked was likely deceased but still receiving monthly electronic benefits from the SSA. The SSA suspended the payments to this account, but due to regulation had to wait seven years before the approximately $200,000 in accumulated benefit overpayments by the SSA could be reclaimed.

In the months prior to the time when the reclamation could be initiated, between June and December 2019, Perkins withdrew all of the funds from this dormant account. A subsequent investigation determined that the customer whose account from which the defendant withdrew funds had been deceased since 1999. In total, Perkins plead guilty to embezzling $207,450 from the deceased customer’s account. With the embezzled funds, the defendant made large cash deposits into her personal bank accounts as well as large cash deposits at casinos in Philadelphia and Atlantic City, totaling over $200,000.

“Bank employees are trusted by their customers and employers to handle money with honesty and integrity,” said Acting U. S. Attorney Williams. “Here, the defendant stole hundreds of thousands of dollars while she was employed in a position of trust at a bank which managed the deceased victim’s account. Our Office will continue to investigate and prosecute this type of fraud in order to protect individual bank account holders and all American taxpayers who pay into the Social Security system.”

“Jonnel Perkins stole money from someone she figured would never miss it,” said Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “In draining that deceased customer’s account, though, she was ripping off the Social Security Administration and those actually entitled to its benefits. The FBI and our federal partners won’t stand for criminals cheating the U.S. government and the millions of taxpayers who fund it.”

The case was investigated the Social Security Administration – Office of the Inspector General and the Federal Bureau of Investigation, and is being prosecuted by Special Assistant United States Attorney Megan Curran.

CHICAGO — A suburban Chicago man admitted in federal court today that he fraudulently misappropriated hundreds of thousands of dollars from a non-profit organization for physically and psychologically challenged children.

STUART NITZKIN, 45, of Deerfield, Ill., pleaded guilty to one count of wire fraud.  U.S. District Judge Sara L. Ellis set sentencing for Aug. 3, 2021.

The guilty plea was 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 Field Office of the FBI.  The government is represented by Assistant U.S. Attorney Sheri H. Mecklenburg.

According to a plea agreement, Nitzkin from 2011 to 2016 worked as the Executive Director of an Illinois-based non-profit organization whose mission was the rehabilitation of physically and psychologically challenged children.  During that time, Nitzkin knowingly submitted to the organization invoices and receipts for payment and reimbursement of expenses that Nitzkin claimed were incurred on behalf of the organization.  In reality, Nitzkin knew the expenses were not actually incurred by the organization but rather by Nitzkin for his and others’ personal benefit, the plea agreement states.

The expenses Nitzkin submitted for reimbursement included luxury vacations for Nitzkin and his family to Las Vegas, Florida, Ireland, and Puerto Rico, personal golfing expenses, tickets to Chicago Bulls basketball games and other professional sporting events, personal medical expenses, real estate taxes for his family residence, health club dues, household goods, meals, and car maintenance, the plea agreement states.  Nitzkin also pocketed cash from fundraising events held on behalf of the organization and used the money for personal expenses, the plea agreement states.

Nitkin admitted in the plea agreement that as a result of the scheme he fraudulently misappropriated at least $550,000 from the organization.  The government charged, and intends to prove at sentencing, that Nitzkin misappropriated approximately $831,400.

Wire fraud is punishable by up to 20 years in prison.  The Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.

Greenbelt, Maryland – U.S. District Judge George J. Hazel sentenced Katrin Verclas, age 52, a native and citizen of Germany residing in Washington, D.C., today to 728 days in federal prison for obstruction of a federal audit and for causing a financial institution to fail to file a suspicious activity report (SAR).  Verclas previously pleaded guilty to those charges, which were related to more than $1.2 million in U.S. State Department grant funds awarded to MobileActive, a corporation that Verclas controlled.  To settle a related civil complaint filed against MobileActive, the corporation will pay $500,000 to the United States within five days of the Court accepting the consent judgment, or today’s sentencing, whichever is later.

The sentence was announced by Acting United States Attorney for the District of Maryland Jonathan F. Lenzner and Special Agent in Charge Mike Speckhardt of the U.S. Department of State Office of Inspector General, Office of Investigations.

According to the plea agreement, on December 17, 2009, the U.S. State Department’s Bureau of Democracy, Human Rights, and Labor (“DRL”) publicized a Request for Proposal (“RFP”) that solicited grant proposals under the title “Promoting Freedom of Expression and the Free Flow of Information through Technology and Access.”  The submission deadline for grant proposals was January 22, 2010.

As detailed in the plea agreement, Verclas, who was residing in Amherst, Massachusetts at the time, had worked for non-profit organizations in the field of social activism through the use of technology since about 1996.  In preparation for a response to the DRL RFP, on January 15, 2010, Verclas converted a project known as MobileActive into a Delaware corporation, and on January 22, 2010, electronically submitted a grant proposal to DRL on behalf of MobileActive.  On September 20, 2010, MobileActive was awarded a grant from the U.S. Department of State in the amount of approximately $1,411,000, to develop and promote: a Mobile Security Toolkit of needed and missing software applications for secure mobile communication; and tactical resources that would allow human rights organizations and activists in specific geographic regions to easily assess and mitigate risks associated with their mobile communications.  The performance period of the grant was September 20, 2010 through about September 30, 2012. 

In order to request the grant funds, MobileActive, through Verclas, established an account with Payment Management System (“PMS”), a federal grants management database located in Bethesda, Maryland.  Between October 26, 2010 and July 26, 2012, Verclas submitted 11 payment requests on behalf of MobileActive, causing the U.S. Department of State to release $1.222 million to MobileActive’s business bank account, which Verclas controlled. 

MobileActive, through Verclas, failed to comply with a number of requirements under the grant.  In November 2012, the State Department began performing an audit and quality assurance inspection with regard to the grant award.  From November 2012 to February 2014, the State Department made several requests, including through letters mailed and hand-delivered to Verclas, to provide documents and information, including a final financial report and inventory report, among other things.  Verclas admitted that she intentionally ignored the State Department’s repeated requests because she knew that she did not have the requisite reports, documents, and other items. 

In addition, Verclas admitted that from November 2010 to October 2012, she failed to disclose to the bank that many of the transactions involving the MobileActive business account were for Verclas’ own personal gain rather than legitimate business purposes.  Verclas knew that, had the bank been aware of the true nature of these transactions, it would have been required to file a SAR.  Through her deception, Verclas willfully caused the bank to fail to file a SAR.

Acting United States Attorney Jonathan F. Lenzner commended the U.S. Department of State, Office of Inspector General, for its work in the investigation. Mr. Lenzner thanked Assistant U.S. Attorney David I. Salem, who prosecuted the case, and thanked Assistant U.S. Attorney Katharine A. Wagner of the Massachusetts U.S. Attorney’s Office, who provided substantial assistance.

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TRENTON, N.J. – An Ocean County, New Jersey, man was sentenced today to 40 years in prison for producing images of himself sexually abusing young children, Acting U.S. Attorney Rachael A. Honig announced.

Sebastien Attar, 36, of Brick, New Jersey, previously pleaded guilty before U.S. District Peter G. Sheridan to an information charging him with two counts of sexual exploitation of children. Separately, Attar also pleaded guilty before Judge Sheridan to a superseding indictment charging him with one count of advertising child pornography. Judge Sheridan imposed the sentence today in Trenton federal court.

According to documents filed in the case and statements filed in court:

Beginning in mid-2017, federal law enforcement began investigating individuals participating in a private chat messaging group dedicated to the discussion and dissemination of images and videos depicting the sexual abuse of children. The private chat group was named “Taboo Train 2.0,” and law enforcement identified Attar as a member of that group, operating with the account identifier “Seb Seb.” The investigation revealed that on multiple occasions and in response to requests from other users, Attar, operating as “Seb Seb,” shared with the “Taboo Train 2.0” chat group images depicting adults sexually abusing very young children.

In March 2018, in connection with the investigation of the “Taboo Train 2.0” chat group, federal law enforcement agents executed a search warrant at Attar’s Brick, New Jersey residence, and seized a number of electronic devices and electronic storage media. In July 2018, a grand jury sitting in the Northern District of Georgia returned a superseding indictment charging Attar and others with advertising child pornography.

During a forensic review of the electronic media seized pursuant to the search of Attar’s residence, law enforcement discovered graphic images in which an individual – later identified as Attar – had photographed himself sexually abusing two infants. Attar was subsequently arrested and charged in a criminal complaint filed in the District of New Jersey. As part of the plea agreement, the superseding indictment filed in the Northern District of Georgia against Attar was formally transferred to the District of New Jersey so that Attar could plead guilty to that charge in conjunction with his guilty plea to the information filed in this district.

In addition to the prison term, Judge Sheridan sentenced Attar to lifetime supervised release.

Acting U.S. Attorney Honig credited special agents of the FBI-Newark Field Office, under the direction of Special Agent in Charge George M. Crouch Jr., and special agents of the FBI-Atlanta Field Office, under the direction of Special Agent in Charge J.C. Hacker, with the investigations leading to today’s guilty pleas. She also thanked prosecutors from the U.S. Attorney’s Office for the Northern District of Georgia, under the direction of Acting U.S. Attorney Kurt R. Erskine, for their assistance.

The government is represented by J. Brendan Day, Attorney in Charge of the Trenton Office of the U.S. Attorney’s Office.