ALBUQUERQUE – Jeremy L. Lara, 37, of Albuquerque, N.M., was sentenced this afternoon in federal court to 30 months in prison followed by three years of supervised release for his conviction on federal fraud and theft or mail charges.

Lara was arrested in May 2016, on a criminal complaint charging him with theft of mail on May 19, 2016, in Sandoval County, N.M., after law enforcement officers found Lara in the process of stealing mail from a community mailbox. According to the complaint, officers recovered a counterfeited USPS arrow key as well as stolen mail from inside Lara’s vehicle.

Lara was subsequently charged in a ten-count indictment on June 14, 2016. Lara was charged with the following: three counts of bank fraud and three counts of aggravated identity theft on Nov. 11, 2015, Nov. 13, 2015, and Nov. 15, 2015; two counts of possession of a counterfeit postal key on Dec. 19, 2015 and May 19, 2016; and three counts of theft or receipt of stolen mail on Dec. 21, 2015 and May 19, 2016. The indictment alleges that the crimes took place in Bernalillo and Sandoval Counties, N.M. The indictment includes forfeiture provisions requiring Lara to forfeit $4,870.28 to the United States.

On Oct. 13, 2016, Lara pled guilty to all counts of the indictment. In entering the guilty plea, Lara admitted that he stole mail by using a counterfeit USPS arrow key that he created. Lara further admitted that he specifically sought out driver’s licenses, bank cards and other personal identifying information to access the bank accounts of legitimate card holders, and impersonated the account holders by using their bank cards and PIN numbers to withdraw cash from ATMs.

This case was investigated by the U.S. Postal Inspection Service and the Rio Rancho Police Department. Assistant U.S. Attorney Nicholas Jon Ganjei prosecuted the case.

BOSTON - A former employee of Tufts Health Plan was sentenced today in federal court in Boston for stealing the identifying information of over 8,000 Medicare customers.

Lynrolte Cezaire, 29, of Medford, was sentenced by U.S. District Court Judge George A. O’Toole Jr. to two years and one day in prison and two years of supervised release. Following a seven-day jury trial in April 2017, Cezaire was convicted by a federal jury of unlawfully disclosing Social Security numbers and aggravated identity theft.

During her time as an employee in the Medicare enrollment department at Tufts Health Plan, from 2011 to 2014, Cezaire helped a coworker, Emeline Lubin, photograph Cezaire’s computer screen while it displayed lists of Medicare customers’ names, dates of birth, and Social Security numbers. Lubin then gave the information to Sniders Jean-Jacques, a Florida man who was involved in a scheme with Lubin’s brother, Marvin, to use stolen identities to steal Social Security benefits and to file false tax returns and collect the refunds.

In October 2014, Marvin Lubinwas sentenced to one year and one day in prison; in December 2014, Jean-Jacqueswas sentenced to two years in prison; and in May 2017, Emeline Lubin was sentenced to three months in prison.

Acting United States Attorney William D. Weinreb; Scott Antolik, Special Agent in Charge of the Office of Inspector General, Social Security Administration, Office of Investigations, Boston Field Division; Phillip Coyne, Special Agent in Charge of the U.S. Department of Health and Human Services, Office of the Inspector General; Joel P. Garland, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston; and Stephen A. Marks, Special Agent in Charge of the U.S. Secret Service, Boston Field Office, made the announcement. Assistance was also provided by the Suffolk County District Attorney’s Office. Assistant U.S. Attorney Robert Richardson of Weinreb’s Major Crimes Unit prosecuted the case.

Harold Duane Friday, 20, of Fort Washakie, Wyoming, was sentenced by Federal District Court Judge Scott W. Skavdahl on July 11, 2017, on three counts of abusive sexual contact. Friday was arrested in Fort Washakie, Wyoming. He received 144 months of imprisonment, to be followed by 15 years of supervised release, and was ordered to pay a $300.00 special assessment and $952.36 in restitution. This case was investigated by the Bureau of Indian Affairs.

Carlos Daniel Jara-Tinoco, 25, of Durango, Mexico, was sentenced by Federal District Court Judge Scott W. Skavdahl on July 11, 2017, for illegal alien in possession of a firearm. Jara-Tinoco was arrested in Cheyenne, Wyoming. He received seven months of imprisonment, to be followed by one year of supervised release, was order to pay a $100.00 special assessment, and is subject to deportation upon release from custody. This case was investigated by the U.S. Department of Homeland Security, Immigration and Customs Enforcement.

Jeffery Mark Quigley, 32, of Cheyenne, Wyoming, was sentenced by Federal District Court Judge Alan B. Johnson on July 10, 2017, for conspiracy to distribute methamphetamine and for possession of a firearm by a person convicted of domestic violence. Quigley was arrested in Cheyenne, Wyoming. He received 135 months of imprisonment, to be followed by four years of supervised release, and was ordered to pay a $200.00 special assessment and $400.00 in restitution. This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives.

Randi Nicole Gunderson, 30, of Thornton, Colorado, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on July 7, 2017, for conspiracy to commit bank fraud and for aggravated identity theft. Gunderson was arrested in Cheyenne, Wyoming. She received 64 months of imprisonment, to be followed by four years of supervised release, and was ordered to pay a $200.00 special assessment and $17,247.29 in restitution. This case was investigated by the United States Postal Inspection Service.

John Todd Allen, 55, of Casper, Wyoming, was recently sentenced by Federal District Court Judge Alan B. Johnson for conspiracy to distribute in excess of one pound of methamphetamine. Allen received 120 months of imprisonment, to be followed by five years of supervised release, and was ordered to pay a $100.00 special assessment and $1,500.00 in restitution. This case was investigated by the Wyoming Division of Criminal Investigation and the U.S. Drug Enforcement Administration.

Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that BRADFORD BARNEYS, 51, of Odenton, Maryland, was sentenced today by U.S. District Judge Michael P. Shea in Hartford to 30 months of imprisonment, followed by three years of supervise release, for conspiring with Timothy W. Burke in a long-running fraud scheme that targeted distressed homeowners throughout Connecticut. BARNEYS was an attorney licensed to practice in Connecticut and has an office in Bridgeport.

According to court documents and statements made in court, between approximately 2010 and November 2015, Timothy W. Burke, formerly of Easton, engaged in a scheme to defraud individuals, mortgage lenders and the U.S. Department of Housing and Urban Development (HUD) by falsely representing to homeowners who were in, or facing, foreclosure on their homes that he would purchase their homes and pay off their mortgages. The distressed homeowners agreed to sign various documents that Burke presented to them on the understanding that, by signing the documents, they would be able to walk away from their homes without the burdens of their mortgage or other costs associated with home ownership. Burke also told homeowners that the process of negotiating with the lenders can take time and that, in the meantime, to ignore any notices regarding foreclosure. After he gained control of these houses, Burke rented out the properties to tenants by advertising the properties on craigslist.com and other means and falsely representing to tenants that Burke owned the property.

Burke or one of his agents then collected rent from tenants, and Burke used the funds for his own benefit. He also failed to negotiate with the homeowners’ mortgage lender or pay expenses associated with the home, including the homeowner’s mortgages and property taxes, and he failed to pay any rental income he was collecting to the homeowners. Many of the properties Burke purportedly purchased were ultimately foreclosed upon by the mortgage lender.

Burke undertook extensive efforts to disguise his true identity, and hide his criminal past, from his victims through the use of multiple aliases and business entities, and to conceal the sources of and expenditures from his criminal proceeds.

Between approximately 2011 to at least 2014, BARNEYS participated in dozens of meetings with Burke and with homeowners at BARNEYS’ law offices in Bridgeport. At the meetings, Burke represented to homeowners that he would purchase their properties and presented to the homeowners quitclaim deeds, management agreements, indemnification agreements, and third party authorizations.

BARNEYS was paid more than $72,000 in fees and other monies for his participation in the fraud.

At some point after BARNEYS began representing Burke in these meetings with homeowners, BARNEYS knew that Burke had no intention of buying the properties and paying the outstanding mortgages on the properties. Nevertheless, BARNEYS continued to participate in these meetings and represented that these transactions were legitimate. When questioned by homeowners about the status of their sales, BARNEYS would assure them that their sales to Burke or one of his companies were progressing as Burke promised. BARNEYS also knew that, once Burke obtained the properties from the homeowners, he would rent them out to tenants.

BARNEYS also represented Burke and his companies in eviction proceedings against tenants.

The investigation further revealed that BARNEYS engaged in separate fraud scheme similar to the scheme that Burke engineered. BARNEYS assisted two Maryland residents in purchasing a commercial property located on Boston Avenue in Bridgeport. BARNEYS then acted as a purported landlord for the property, executed long-term lease agreements with at least two tenants, and collected tens of thousands of dollars of rent without the actual owners’ knowledge or authorization and kept the funds for his own use.

On February 21, 2017, BARNEYS pleaded guilty to one count of conspiracy to commit mail and wire a fraud.

BARNEYS’ law license was temporarily suspended by state authorities after he pleaded guilty, with additional proceedings scheduled to determine whether further discipline is warranted. Judge Shea ordered BARNEYS not to apply for reinstatement of his law license, and not to engage in any business related to real estate, while he is on supervised release.

On January 24, 2017, Burke pleaded guilty to one count of mail fraud and one count of tax evasion. On April 28, 2017, he was sentenced to 108 months of imprisonment.

This matter was investigated by the U.S. Department of Housing and Urban Development – Office of Inspector General, U.S. Postal Inspection Service, and Internal Revenue Service – Criminal Investigation Division, with the critical assistance of the Middletown, Plainville, Easton and Coventry Police Departments, the Connecticut State Police and the Bureau of Alcohol, Tobacco, Firearms and Explosives.

The case was prosecuted by Assistant U.S. Attorneys David T. Huang and Sarah P. Karwan.

            WASHINGTON – Jonathan Tran, 27, of Milpitas, Calif., pled guilty today to a federal charge stemming from an incident earlier this year in which he illegally entered the grounds of the White House, announced U.S. Attorney Channing D. Phillips and Brian J. Ebert, Special Agent in Charge, Washington Field Office, U.S. Secret Service.

            Tran pled guilty in the U.S. District Court for the District of Columbia to a charge of entering or remaining in a restricted building or grounds. The charge carries a statutory maximum of a year in prison and a potential fine. The parties agreed to recommend to the Court that any period of supervised release or probation include conditions, including a prohibition barring Tran from entering the District of Columbia while he is under supervision, except for court appearances and meetings with his lawyer. He also would be required to participate in interviews with the Secret Service to assist in determining potential current and future risks.

            The Honorable James E. Boasberg scheduled sentencing for Sept. 25, 2017. Tran remains free on personal recognizance pending the sentencing.

            “This guilty plea holds Jonathan Tran accountable for illegally entering the grounds of the White House and putting himself and others at risk,” said U.S. Attorney Phillips. “Thanks to the Secret Service, he was arrested and no one was hurt in this defendant’s reckless and potentially dangerous act.”

            “The safety and security of the President, the First Family and all staff and visitors to the White House complex is the Secret Service’s first priority,” said Special Agent in Charge Ebert. “Any attempt to breach security and gain unauthorized access is a serious criminal offense and will be dealt with as such. The Secret Service continuously strives to improve and adapt our protective methodologies and security features to meet the ever growing and evolving threat.”

            According to the government’s evidence, on March 10, 2017, at about 11:35 p.m., an officer with the U.S. Secret Service’s Uniform Division saw Tran walking from the east side of the south grounds of the White House complex. Tran, who was wearing a hooded sweater or jacket and carrying a backpack, was approaching the South Portico entrance to the White House. When Tran saw the officer, he altered course and began heading toward the South Lawn. The officer confronted Tran, who claimed to be “a friend of the President.” In a search incident to arrest, two cans of pepper spray were found on Tran, including one inside his jacket pocket.

            This case was investigated by the Secret Service’s Washington Field Office. It was prosecuted by Assistant U.S. Attorney David J. Mudd of the U.S. Attorney’s Office.

BOSTON – A senior sales executive at a seafood processing company in Gloucester was sentenced today in federal court in Boston for tax fraud.

Richard J. Pandolfo, 71, of North Andover, was sentenced by U.S. District Court Judge Richard G. Stearns to one year of probation with six months to be served in home confinement, a fine of $5,000, and restitution of $25,879. In April 2017, Pandolfo pleaded guilty to one count of making and subscribing a false tax return.

From 2008 to 2012, Pandolfo received substantial supplemental income for his work at a seafood processing company in Gloucester from the company’s president. Some of those payments were made directly to Pandolfo or to his spouse, but Pandolfo did not report or pay taxes on any of those payments. Other payments were made by a corporate entity controlled by the seafood processor’s president to a purported interior design company set up in the name of Pandolfo’s spouse. Pandolfo did report that income, but improperly deducted personal expenses from that income as business expenses, thereby improperly reducing the taxes he owed. In total, Pandolfo failed to pay $25,879 in taxes, which he agreed to pay in restitution to the Internal Revenue Service as part of his plea agreement.

Acting United States Attorney William D. Weinreb and Joel P. Garland, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston,made the announcement. Assistant U.S. Attorneys Stephen E. Frank and Brian A. Pérez-Daple of Weinreb’s Economic Crimes Unit prosecuted the case.

The case involved a cluster of overdoses, in Montgomery County, caused by carfentanil.

LEXINGTON, Ky. – Today, a federal jury convicted Robert Shields, of Cincinnati, and Wesley Hamm, of Mount Sterling, Ky., of one count of conspiracy to distribute carfentanil, fentanyl, and heroin; one count of distribution of carfentanil resulting in death; and one count of distribution of carfentanil resulting in serious bodily injury. The charges involved a cluster of drug overdoses, within a 12-hour period, in Montgomery County, in August of 2016. The jury returned its verdict after an hour and twenty minutes of deliberation, following four days of trial.

“These defendants were illegally distributing extremely dangerous drugs; and all too predictably, that resulted in overdoses and an unnecessary death,” said Carlton S. Shier, IV, Acting United States Attorney for the Eastern District of Kentucky. “Carfentanil is designed for large mammals – not humans – and presents a grave danger to the public. These defendants brazenly risked the lives of the people in Montgomery County and our office remains committed to using the severe penalties available to punish drug trafficking resulting in overdoses under federal law. The great work of our local and federal law enforcement partners made this case possible and helps make our Overdose Prosecution Initiative such a success.”

Both men face a minimum of twenty years and a maximum of life imprisonment.

Acting United States Attorney Shier; Timothy J. Plancon, Special Agent in Charge of the Detroit Field Division of the DEA; Fred Shortridge, Montgomery County Sheriff; and David Charles, Chief of the Mount Sterling Police Department, jointly announced the verdict.

Formal sentencing for both defendants is scheduled for November 17, 2017. The investigation was conducted by DEA, the Montgomery County Sheriff’s Office, and the Mount Sterling Police Department. Assistant U.S. Attorney Todd Bradbury prosecuted the case on behalf of the federal government.

BOSTON – A Dominican national was charged today in federal court in Boston with stealing the identity of a U.S. citizen from Puerto Rico. 

Jhonny Emilio Pimentel Aybar, 34, a Dominican national residing in Everett, was charged by indictment with three counts of misuse of a Social Security number and three counts of aggravated identity theft. 

On three occasions, Aug. 8, 2012, Aug. 15, 2013, and Aug. 20, 2014, Aybar misrepresented his social security number and identity when registering as a sex offender with the Everett Police Department.

The charge of Social Security fraud provides for a sentence of no greater than five years in prison, three years of supervised release, and a fine of $250,000. The charge of aggravated identity theft provides for a mandatory minimum sentence of two years in prison, to be served consecutively to any sentence imposed on the Social Security fraud count. Aybar will be subject to deportation upon completion of his sentence. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.

Acting United States Attorney William D. Weinreb; Matthew J. Etre, Special Agent in Charge of Homeland Security Investigations in Boston; and Scott Antolik, Special Agent in Charge of the Social Security Administration, Office of Inspector General, Office of Investigations, Boston Field Division, made the announcement today.  Assistant United States Attorney Anne Paruti of Weinreb’s Major Crimes Unit is prosecuting the case.

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

          LOS ANGELES– In the largest-ever health care fraud enforcement action by federal prosecutors, 14 defendants – including doctors, nurses and other licensed medical professionals – have been charged in the Central District of California for allegedly participating in health care fraud schemes that caused approximately $147 million in losses.

          The defendants charged locally are among hundreds of people charged across the United States in cases that cumulatively allege approximately $1.3 billion in false billings. The nationwide sweep includes charges against more than 120 defendants – some of whom are doctors – who allegedly prescribed and distributed opioids and other dangerous narcotics.

          In the Central District of California, 14 defendants were charged for their roles in schemes to defraud health insurance programs such as Medicare. The cases allege health care fraud and kickback schemes involving compounded drugs, home health services, physical therapy, acupuncture, Medicare Part D prescription drugs, diagnostic sleep studies and hospice care.

          “Health care fraud schemes such as these threaten the vital trust between a patient and his or her health care provider, undermine the integrity of our health care system, and cost all Americans billions of dollars,” said Acting United States Attorney Sandra R. Brown. “Today’s announcement serves as a clear warning that we will continue to work with our law enforcement partners to identify and hold accountable health care professionals who commit these crimes.”

          The defendants charged locally include four physicians, including Dr. Jeffrey Olsen, who was charged with illegally prescribing controlled substances, including the opiate oxycodone.

          The 57-year-old Olsen surrendered to authorities on Tuesday after being indicted last week by a federal grand jury on 34 counts of illegally prescribing controlled drugs, including oxycodone, and one count of false statement on a DEA registration application. Olsen, a resident of Laguna Beach, allegedly sold prescriptions to addicts and drug dealers in exchange for fixed cash fees, without any medical basis for the prescriptions.

          During the investigation, Olsen also sold hundreds of prescriptions to addicts in other states, such as Oregon, without ever seeing the “patients” for an in-person examination. In text messages to these out-of-state customers, Olsen allegedly told customers that, in exchange for exorbitant fees as high as $3,000, he would write prescriptions for whatever drug they wanted, and that he would never check whether they were actually taking the prescribed drugs or whether they were getting additional narcotic prescriptions from other doctors. Olsen allegedly sold more than 1.2 million pills of narcotics, which were almost entirely at maximum strength, in addition to hundreds of thousands of pills of other controlled drugs such as the sedatives Xanax and Soma. The case against Olsen is being prosecuted by Assistant United States Attorneys Ben Barron and Bryant Yang.

          In another local case involving a physician, Dr. Thomas S. Powers and Anthony Paduano were arrested Tuesday on healthcare fraud charges that allegedly bilked TRICARE.

          The indictment in this case alleges that Powers, of Santa Ana, authorized prescriptions for compounded medications for patients he never examined. Under an agreement, Paduano, of Newport Beach, allegedly paid Powers $200 for each prescription. Paduano received approximately $1.2 million for referring the prescriptions to a local pharmacy that billed TRICARE more than $4.8 million and was paid more than $3.1 million. This case is being handled by Assistant United States Attorneys Mark Aveis, Paul Stern and Cassie Palmer.

          “Americans already struggling with health care issues and rising premiums are further burdened with each dollar lost to fraud,” said Deirdre Fike, the Assistant Director in Charge of the FBI’s Los Angeles Field Office. “The losses estimated in Los Angeles for this operation alone are staggering as the abundance of health care fraud schemes in southern California adds considerably to this nationwide crime issue. By collaborating with our partners, we will continue to hold accountable those who get rich by targeting federal health care programs with fraud.”

          “Those who would enrich themselves through healthcare fraud – including billing for unnecessary services, accepting kickbacks, and billing for prescriptions that were never provided – are putting profits over patients, stealing from government health programs and taxpayers alike,” said Special Agent in Charge Christian Schrank, of the U.S. Department of Health and Human Services Office of Inspector General. “These operations show yet again our commitment to working with our federal and state law enforcement partners. In fighting this epidemic, we must all stand together.”

          “IRS Criminal Investigation will not stand still while criminals line their pockets with illicit proceeds obtained from publicly funded health care programs,” said IRS Criminal Investigation Special Agent in Charge R. Damon Rowe. “It depletes scarce taxpayer dollars and will not be tolerated. IRS Criminal Investigation will continue to work with our federal and state law enforcement partners to bring justice to those individuals who prey on the nation's health care system for their own personal greed.”

          “Our office, in partnership with our fellow investigative agencies, will continue to uncompromisingly investigate and bring to justice the people who perpetrate these criminal acts,” said Amtrak Inspector General Tom Howard. We will remain vigilant in protecting Amtrak employees, retirees, and their dependents, by ensuring our health care dollars are not wasted on fraudulent providers,"

          “The Department of Labor – Employee Benefits Security Administration will continue to vigorously investigate wrongdoers committing health care fraud against employer sponsored health plans in Southern California which also impact TRICARE, Medicare, Medicaid” said Crisanta Johnson, DOL-EBSA’s Los Angeles Regional Office.

          The other cases filed in federal court in Los Angeles as part of the nationwide sweep are:

• Aniceto Baliton, of Diamond Bar, co-owner and managing employee of Bliss Hospice in Glendora, was charged yesterday with one count of conspiracy to pay and receive illegal remunerations for health care referrals. The charge stems from Baliton’s role in a fraud scheme to pay kickbacks in exchange for Medicare beneficiaries referred to Bliss and billed by Bliss for hospice services. As part of the fraud scheme, Baliton and the co-owners of the hospice also agreed to generate cash for the illegal kickbacks by disguising such monies as payroll expenses. Based on the referrals that Baliton and his co-conspirators obtained through illegal kickbacks, Bliss submitted claims to Medicare and was paid approximately $2.4 million. The case is being handled by DOJ Trial Attorney Claire Yan.

• Aleksandr Suris and Maxim Sverdlov, co-owners and operators of Royal Care Pharmacy in Los Angeles, were arrested Monday on charges related to a scheme that allegedly brought in more than $41.5 million from Medicare and CIGNA. The indictment in this case charges Suris with two counts of conspiracy to commit health care fraud and 10 counts of health care fraud, and Sverdlov with one count of conspiracy to commit health care fraud and four counts of health care fraud. The defendants allegedly submitted fraudulent bills for prescription drugs that were never filled by the pharmacy or were not provided to the person to whom the drug was prescribed. The case is being handled by DOJ Trial Attorney Robyn N. Pullio.

• Dr. Kanagasabai Kanakeswaran was indicted late last month on one count of conspiracy to pay and receive kickbacks for health care referrals and four counts of receiving kickbacks for health care referrals. The charges arise from a kickback conspiracy at a home health company called Star Home Health Resources. The owners and operators of Star allegedly paid kickbacks to referring physicians, including Dr. Kanakeswaran, in exchange for the physicians referring Medicare beneficiaries to receive home health services from Star. The indictment alleges that from May 2008 to May 2016, Star was paid $4,157,311 from Medicare based on home health services that Dr. Kanakeswaran referred to Star in exchange for illegal kickbacks. The case is being handled by Assistant United States Attorney Alex Porter and DOJ Trial Attorney Claire Yan.

• Jamen Oliver Griffith and Damon Glover were charged late last month with conspiring to solicit, receive and pay illegal kickbacks for health care referrals. The charges stem from defendants’ role in a scheme involving undisclosed payments for generating and steering prescriptions of compounded drugs to Valley View Drugs, Inc., a pharmacy located in La Mirada. As set forth in plea agreements that have been filed in court, Griffith and Glover owned and operated Western Medical Solutions, a “marketing” company that paid non-employee “marketers” to generate compounded drug prescription referrals for Valley View. Commission payments to “marketers” for prescription referrals were based on a percentage of the amount insurance companies reimbursed Valley View. Health insurers ultimately reimbursed Valley View $13,860,083 for prescriptions generated by WMS-affiliated marketers. In turn, Valley View paid WMS approximately $7,622,864 for the prescription referrals. The case is being handled by Assistant United States Attorney Ashwin Janakiram.

• Xiao “Kimi” Gudmundsen, a licensed acupuncturist and the owner of Healthy Life Acupuncture Center, Inc., which operated at two sites in Los Angeles and Riverside, was charged on June 22, with eight counts of health care fraud and three counts of money laundering. The charges arise from allegations that Gudmundsen recruited Amtrak employees to visit Healthy Life and then, among other things, billed the Amtrak health care plan for acupuncture and other services that were not actually provided. The indictment also charges that Gudmundsen laundered payments received from Amtrak for the false bills through various accounts, including accounts held in the names of relatives. Also charged in the indictment are Suzana Cortez, a Healthy Life employee (who faces five counts health care fraud) and Gladys Perez, an Amtrak employee (who faces two counts of health care fraud). This case is being handled by Assistant United States Attorney Poonam Kumar.

• James Chen pleaded guilty on June 19 to a health care fraud charge related to his pharmacy processing and billing TRICARE for approximately $62 million for fraudulent prescriptions for compounded medications after Chen paid more than 50 percent in referral fees to marketers. The case is being handled by Assistant United States Attorneys Mark Aveis, Paul Stern and Cassie Palmer.

          Indictments and criminal informations contain allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until and unless proven guilty in court.

          The cases from the Central District of California are the result of investigations conducted by the United States Department of Health and Human Services, Office of Inspector General; the Federal Bureau of Investigation; the Defense Criminal Investigative Service; the Drug Enforcement Administration; IRS Criminal Investigation; the Office of Personnel Management, Office of Inspector General; the Veterans Administration, Office of the Inspector General; the Department of Labor - Employee Benefits Security Administration; the California Department of Insurance, Fraud Division; the United States Postal Service, Office of the Inspector General; Amtrak’s Office of the Inspector General; the California Board of Pharmacy; California’s Department of Health Care Services; and the California Department of Justice.

          The local cases were filed by Assistant United States Attorneys and Trial Attorneys with the Justice Department’s Medicare Fraud Strike Force. The Strike Force operations are part of a joint initiative between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country.

KANSAS CITY, Mo. – Tom Larson, Acting United States Attorney for the Western District of Missouri, announced that a former Honeywell employee was sentenced in federal court today for engaging in a fraud scheme that caused a loss of more than $50,000.

Trent L. Christie, 37, of Olathe, Kan., was sentenced by U.S. District Judge Howard F. Sachs to one year and one day in federal prison without parole. Christie has also fully paid $50,480 in restitution to Honeywell.

Christie was employed at the Kansas City branch of Honeywell Federal Manufacturing and Technologies, a management and operating contractor for the National Nuclear Security Administration (NNSA), which is the agency under the U.S. Department of Energy responsible for enhancing national security through the military application of nuclear science.

On Dec. 15, 2016, Christie pleaded guilty to four counts of wire fraud. Christie admitted that, in his capacity as a Honeywell employee with purchasing authority, he submitted purchase orders for approximately 129 pieces of equipment, all without the permission or knowledge of either Honeywell or the NNSA. None of the equipment was classified.

Christie engaged in his fraud scheme from June 15, 2010, to Aug. 27, 2014. The costs to Honeywell and subsequently to the NNSA of the unnecessary equipment was approximately $50,480.

After receiving the equipment, Christie advertised the items for sale on eBay. If sold, he removed the items from the Honeywell facility and shipped them, often from his personal residence, to the purchaser. Total sales by Christie netted him approximately $20,847.

This case was prosecuted by Senior Litigation Counsel Gregg R. Coonrod. It was investigated by the Department of Energy, Office of the Inspector General.

WASHINGTON—Attorney General Jeff Sessions and Department of Health and Human Services (HHS) Secretary Tom Price, M.D., announced today the largest ever health care fraud enforcement action by the Medicare Fraud Strike Force, involving 412 charged defendants across 41 federal districts—including the Eastern District of Arkansas. Among the defendants were 115 doctors, nurses and other licensed medical professionals, all alleged to have participated in health care fraud schemes involving approximately $1.3 billion in false billings. Of those charged, over 120 defendants, including doctors, were charged for their roles in prescribing and distributing opioids and other dangerous narcotics. Thirty state Medicaid Fraud Control Units also participated in today’s arrests. In addition, HHS has initiated suspension actions against 295 providers, including doctors, nurses and pharmacists.

In Arkansas, Patrick C. Harris, Acting United States Attorney for the Eastern District of Arkansas and Stephen G. Azzam, Special Agent in Charge of the Drug Enforcement Administration’s (DEA) New Orleans Field Division, who oversees the DEAs’ Little Rock District Office, announced the unsealing of three indictments charging 24 defendants in schemes intended to divert pharmaceutical pills to the streets.

“The abuse of prescription medication, particularly opioids, is one of the largest health and crime problems Arkansas is facing,” Harris said. “This epidemic must be attacked on multiple fronts—by stopping the criminal doctors and medical professionals from writing medically unnecessary prescriptions, and by preventing the common drug dealers from diverting these pills to the hands of other addicts and dealers, either by writing fraudulent prescriptions or stealing dangerous drugs from pharmacies. The defendants in the cases announced by my office today illegally put hundreds of thousands of pills on the streets, and they must be stopped. The Eastern District of Arkansas joins the Justice Department’s resolve to aggressively pursue and prosecute all manner of health care and prescription pill crime.”

In the first Arkansas case, 4:16-cr-00278-KGB, charges stem from an early-morning burglary on February 25, 2016, of the Health-Way pharmacy in Beebe. On December 7, 2016, the four suspects in the burglary, Albert Ray Ferguson, Jr., Thristian Davante Duplechin, Corry Wayne Cornett, and Cory Jermaine Lewis, all from Houston, Texas, were charged with conspiracy to break in a business premises registered with the DEA to dispense controlled substances.

Following the arrest of the initial four defendants, an ongoing investigation by the DEA Tactical Diversion Squad uncovered a network of individuals who were traveling between states to commit pharmacy burglaries. During the investigation, the DEA canvased law enforcement agencies from nearby states for similar pharmacy burglaries, and developed evidence linking eight additional defendants to the defendants from Beebe. Physical and electronic evidence from numerous burglaries in several states, including Arkansas, Nebraska, Indiana, Illinois, Iowa, Kentucky, Virginia, and Texas, showed that the individuals involved were members of local street gangs in the Houston area.

These gangs stole more than 120,000 Schedule II pills during these burglaries, with a street value of at least $1,050,000. On July 6, 2017, a superseding indictment was returned in the Eastern District of Arkansas adding an additional count charging the other gang members with conspiracy to possess with intent to distribute Schedule II, III and IV controlled substances.

In case 4:17-cr-176-BSM, a federal Grand Jury charged Erik Edson Turner and two others with conspiracy to possess with intent to distribute Schedule II controlled substances without an effective prescription. Beginning in 2015, Turner fabricated prescriptions to fraudulently obtain oxycodone 30 mg tablets from pharmacies. Turner sold some of the oxycodone to Spencer Daniel King, who eventually joined Turner in the conspiracy to obtain the drug by using fraudulent prescriptions. In 2016, Michael Joseph “Joey” Carbonero was recruited by Turner to assist in the scheme. Over the course of two years, Turner and individuals working on his behalf obtained thousands of oxycodone pills with a street value in excess of $150,000. These cases are being prosecuted by Assistant United States Attorney Anne E. Gardner.

In the third case, 4:17-cr-00184 BSM, the DEA Tactical Diversion squad uncovered a sophisticated prescription-forgery operation headed by Michael McClellan, 32, of North Little Rock. In this scheme, McClellan created fraudulent prescriptions using computer templates that either McClellan or other individuals then filled at local pharmacies.

The investigation into McClellan’s operation began following a break-in at McClellan’s home. When police arrived, they discovered numerous pieces of drug paraphernalia and other indicators of illegal activity. The DEA obtained a search warrant for the computers in McClellan’s home, and an analysis of these computers revealed the extent of the operation.

Agents also located drug ledgers in McClellan’s home that, coupled with the information from the computers, revealed the names of nearly 100 people whose identification was used to obtain fraudulent prescriptions. All told, since the conspiracy began in 2012, more than 74,000 pills were obtained from these forged prescriptions. McClellan and the eight other main individuals in the organization are charged with conspiracy to possession with intent to distribute Schedule II controlled substances. This cases is being prosecuted by Assistant United States Attorney Chris Givens.

“The diversion and abuse of prescription drugs pose a significant threat to the health and safety of our communities across the nation, including here in Arkansas,” Special Agent in Charge Azzam said. “Today, more people die from opioid-related causes than from gun homicides. This unprecedented collaboration between all law enforcement agencies represented in this region exemplifies the continuing unified goal of keeping our neighborhoods safe and secure. The indictment of these individuals will undoubtedly convey a strong and unified message to those criminals who continue to engage in activities, such as these pharmacy burglaries, threatening the safety of our citizens.”

Nationwide, today’s enforcement actions were led and coordinated by the Criminal Division, Fraud Section’s Health Care Fraud Unit in conjunction with its Medicare Fraud Strike Force (MFSF) partners, a partnership between the Criminal Division, U.S. Attorney’s Offices, the FBI and HHS-OIG. In addition, the operation includes the participation of the DEA, DCIS, and State Medicaid Fraud Control Units.

The charges announced today aggressively target schemes billing Medicare, Medicaid, and TRICARE (a health insurance program for members and veterans of the armed forces and their families) for medically unnecessary prescription drugs and compounded medications that often were never even purchased and/or distributed to beneficiaries. The charges also involve individuals contributing to the opioid epidemic, with a particular focus on medical professionals involved in the unlawful distribution of opioids and other prescription narcotics, a particular focus for the Department. According to the CDC, approximately 91 Americans die every day of an opioid related overdose.

“Too many trusted medical professionals like doctors, nurses, and pharmacists have chosen to violate their oaths and put greed ahead of their patients,” Attorney General Sessions said. “Amazingly, some have made their practices into multimillion dollar criminal enterprises. They seem oblivious to the disastrous consequences of their greed. Their actions not only enrich themselves often at the expense of taxpayers but also feed addictions and cause addictions to start. The consequences are real: emergency rooms, jail cells, futures lost, and graveyards. While today is a historic day, the Department's work is not finished. In fact, it is just beginning. We will continue to find, arrest, prosecute, convict, and incarcerate fraudsters and drug dealers wherever they are.”

“Healthcare fraud is not only a criminal act that costs billions of taxpayer dollars - it is an affront to all Americans who rely on our national healthcare programs for access to critical healthcare services and a violation of trust,” Secretary Price said. “The United States is home to the world’s best medical professionals, but their ability to provide affordable, high-quality care to their patients is jeopardized every time a criminal commits healthcare fraud. That is why this Administration is committed to bringing these criminals to justice, as President Trump demonstrated in his 2017 budget request calling for a new $70 million investment in the Health Care Fraud and Abuse Control Program. The historic results of this year’s national takedown represent significant progress toward protecting the integrity and sustainability of Medicare and Medicaid, which we will continue to build upon in the years to come.”

According to court documents, the defendants allegedly participated in schemes to submit claims to Medicare, Medicaid and TRICARE for treatments that were medically unnecessary and often never provided. In many cases, patient recruiters, beneficiaries and other co-conspirators were allegedly paid cash kickbacks in return for supplying beneficiary information to providers, so that the providers could then submit fraudulent bills to Medicare for services that were medically unnecessary or never performed.

The number of medical professionals charged is particularly significant, because virtually every health care fraud scheme requires a corrupt medical professional to be involved in order for Medicare or Medicaid to pay the fraudulent claims. Aggressively pursuing corrupt medical professionals not only has a deterrent effect on other medical professionals, but also ensures that their licenses can no longer be used to bilk the system.

The Medicare Fraud Strike Force operations are part of a joint initiative between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country. The Medicare Fraud Strike Force operates in nine locations nationwide. Since its inception in March 2007, the Medicare Fraud Strike Force has charged over 3500 defendants who collectively have falsely billed the Medicare program for over $12.5 billion.

A complaint, information, or indictment is merely an allegation, and all defendants are presumed innocent unless and until proven guilty.

Additional documents related to this announcement are available here: https://www.justice.gov/opa/documents-and-resources-july-13-2017.

16-278 Indictment

17-176 Indictment

17-184 Indictment

ROCKFORD — A Chicago man was found guilty of conspiracy to manufacture and distribute marijuana following a four-day jury trial in federal court in Rockford.

YOUSIF Y. PIRA, 64, was found guilty of conspiring to manufacture, possess and distribute 1,000 or more marijuana plants.

The conviction was announced by Joel R. Levin, Acting United States Attorney for the Northern District of Illinois; Celinez Nunez, Special Agent-in-Charge of the Chicago Field Division of the U.S. Bureau of Alcohol, Tobacco, Firearms & Explosives; Derek Bergsten, Chief of the Rockford Fire Department; and Anthony Scarpelli, Chief of the Skokie Police Department. The Winnebago County Sheriff’s Department Narcotics Unit and the Rockford Police Department Narcotics Unit assisted in the investigation.

According to the indictment and the evidence at trial, between Jan. 2, 2013, and Jan. 6, 2015, Pira conspired with JEREMIAH N. CLEMENT, 39, of Des Plaines, GEORGE H. BACUS, 53, of Niles, JUSTIN T. PAGLUSCH, 36, of Ingleside, SHLIMON SHIMON, 49, of Chicago, and CASEY WILLIAMS, 30, and DESTINY FREEMAN, 23, both of Great Falls, Mont., to illegally grow, store and distribute marijuana in a warehouse at 1916 11th Street in Rockford. The warehouse was destroyed by a fire on Jan. 6, 2015.

As part of the conspiracy, among other things, Pira purchased grow lights and other equipment and supplies for the illegal operation to grow marijauna in the warehouse, and installed wiring for the lights used to grow marijuana.

Conspiring to manufacture 1,000 or more marijuana plants carries a maximum sentence of life imprisonment, and a statutory mandatory minimum sentence ten years’ imprisonment. The charge also carries a term of supervised release following imprisonment of at least five years and up to life, and a maximum fine of $10 million.

Clement pleaded guilty and was sentenced to ten years’ imprisonment on June 3, 2016. Pagluach pleaded guilty and was sentenced to ten years’ imprisonment on June 23, 2016. Bacus, Williams and Freeman have pleaded guilty and are awaiting sentencing. An arrest warrant was issued for Shimon, who is still at large.

The government is represented by Assistant U.S. Attorneys Joseph C. Pedersen and Margaret J. Schneider.

Acting U.S. Attorney Duane A. Evans announced that DARRELL RICKS, age 66, of Covington, pled guilty today to crimes involving the sexual exploitation of children.

According to court documents, beginning at an unknown time to on or about October 21, 2016, RICKS knowingly downloaded and received images and videos depicting the sexual victimization of minors.

RICKS faces a maximum sentence of up to twenty years imprisonment, followed by up to a lifetime term of supervised release, and a $250,000 fine. U.S. District Judge Nannette Jolivette Brown will sentence RICKS on October 19, 2017.

This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."

Acting U.S. Attorney Evans praised the work of the U. S. Department of Homeland Security, Homeland Security Investigations, the Louisiana State Police, St. Tammany Parish Sheriff’s Office, and the Louisiana Bureau of Investigation in investigating this matter. The prosecution of this case is being handled by Project Safe Childhood Coordinator and Fraud Section Chief, Assistant U. S. Attorney Brian M. Klebba.

LITTLE ROCK—Patrick C. Harris, Acting United States Attorney for the Eastern District of Arkansas, and Matthew Barden, Assistant Special Agent in Charge, Drug Enforcement Administration (DEA), Little Rock District Office, announced today that a federal jury found Elsa Solis, 38, of Batesville, guilty of conspiracy to possess with intent to distribute methamphetamine, possession with the intent to distribute methamphetamine, and misprision in a case that involved smuggling 2.5 kilos of methamphetamine and $19,000 cash inside two car seats.

United States District Judge Kristine G. Baker presided over the three-day trial, which concluded Wednesday with the jury verdict finding Solis guilty on all counts. Solis will be sentenced by Judge Baker at a later date.

“It is reprehensible that a mother would use her children to attempt to conceal her methamphetamine smuggling,” Harris said. “This conspiracy involved multiple kilos of methamphetamine intended to poison our communities, and the hard work of everyone involved ensured a jury verdict which completes the successful dismantling of this dangerous drug trafficking organization.”

Solis is the final member of the charged conspiracy to be convicted. The individuals charged in the conspiracy included Solis and her boyfriend, Ivan Pedraza, as well as six others. Pedraza previously pleaded guilty to conspiracy and possession with intent to distribute methamphetamine. The other six defendants also previously pleaded guilty to various charges associated with the case.

Testimony during the trial established that prior to the discovery of the loaded car seats on July 19, 2015, Homeland Security Investigations and the DEA intercepted two packages which contained 18 kilograms of methamphetamine that were mailed from Mexico and addressed to the addresses of individuals involved in the conspiracy.

Evidence at trial included recorded wiretap phone calls between Pedraza and Solis. The phone calls were in Spanish and translations were provided to the jury. DEA Special Agent LeAnn Bakr explained to the jury how a wiretap is obtained, how calls are monitored, and that 11 such calls were selected and translated for the trial.

In the recorded calls the jury heard Solis agreeing to buy acetone, which is used by methamphetamine traffickers to rid the substance of impurities before sale. The recorded calls also documented a trip to Dallas taken by Pedraza, Solis, and her two children in July 2015. The jury heard calls that discussed how Pedraza and Solis needed to buy new car seats, since the others were left in Batesville. One call recorded Pedraza talking about how one car seat left behind was still loaded with “stew.” Former DEA Task Force Officer Ryan Temple, now with North Little Rock Police Department testified that “stew” was a code word for methamphetamine.

Officer Temple also provided surveillance during Solis and Pedraza’s trip to Dallas. He testified that Solis, Pedraza, and her two children drove to Dallas in a Honda Pilot on a Friday, and arrived in the Dallas area after midnight, only to leave early on Sunday morning less than 36 hours later.

Calls intercepted during the Dallas trip recorded Solis asking Pedraza if he had “fixed” everything while she had waited at the hotel pool and arcade with her children. Agents also overheard Pedraza planning the delivery with other co-conspirators and discussing how much methamphetamine was ready to be delivered when he returned to Arkansas.

Officer Temple testified that he and his surveillance team witnessed Pedraza receive the methamphetamine at the hotel after agents intercepted a call that stated that the co-conspirator would arrive at the hotel with a blender box.

After the Honda left the Dallas area that early Sunday morning, Arkansas State Police Trooper Timothy Callison performed a traffic stop on the vehicle as it entered Saline county. The trooper located methamphetamine, which totaled to 2.5 kilos, and $19,000 in cash, in the bottom of the car seats, which he noticed were abnormally heavy. The trooper was able to remove the bottoms of the car seats—discovering the methamphetamine and cash—with a drill that was also located in the vehicle. The trooper testified that the drill had only one bit, and it fit perfectly with the car seat screws, needing no adjustments. More than $1,700 cash was later found in Solis’ purse when she was in custody.

Law enforcement later located approximately $40,000 and more methamphetamine in subsequent search warrants executed on two homes related to the conspiracy in Batesville and one home in Little Rock.

The statutory penalty for conspiracy to possess with intent to distribute and for possession with intent to distribute more than 500 grams of methamphetamine is not less than 10 years’ imprisonment, not more than life, a $10,000,000 fine, or both, and not less than five years of supervised release. The statutory penalty for misprision, which makes it a crime to have knowledge that a crime is being committed while taking a step to conceal and not report the crime, is not more than three years’ imprisonment, a $250,000 fine, and one year of supervised release.

The investigation was conducted by the DEA, with assistance from the Arkansas State Police and other local agencies. The case was prosecuted by Assistant United States Attorneys Erin O’Leary and Allison Bragg.

Acting U.S. Attorney Duane A. Evans announced that ANDREW O’NEIL BOWYER, age 26, a resident of Jamaica, was sentenced today after previously pleading guilty to a one-count Indictment for Conspiracy to Commit Mail Fraud.

U.S. District Judge Carl J. Barbier sentenced BOWYER to 78 months incarceration, followed by 3 years of supervised release, and a $100 special assessment. A hearing on restitution is set for October 5, 2017.

According to court records, on or before August 2013, BOWYER and others operated a scheme to contact elderly individuals and people with diminished capacity who would be susceptible to being scammed. The scheme involved contacting victims by telephone through Voice Over Internet Protocol (“VoIP”) and informing them they had won the Publisher’s Clearing House Sweepstakes or similar lottery and needed to pay BOWYER and others monies by cash, check, wire, and other methods in order to claim their lottery winnings.

BOWYER and others obtained names, addresses, and other biographical information from an unknown source. They used the information to identify victims, telephone them, or direct others to telephone them, to represent that they had won the sweepstakes and inform them they would need to send him or others money in order to claim their winnings.

It was part of the scheme and artifice to defraud that on or around March 30, 2015, BOWYER employed false representations and promises in order to convince V.L., an elderly person, into believing she had won a sweepstakes, causing V.L. to send money via the United States Postal Service to CC-1, a co-conspirator living in New Orleans. V.L. sent the money to CC-1 in reliance on BOWYER’s false representations and promises that if she sent the money to CC-1, she would be awarded sweepstakes winnings. Immediately after receiving the funds in the mail from V.L., CC-1 deposited the money into his bank account in New Orleans, and initiated a wire transfer of the funds from the account to BOWYER’s account in Jamaica.

Acting U.S. Attorney Evans praised the work of the United States Postal Service, Office of Inspector General, United States Secret Service, and the United States Department of Homeland Security in investigating this matter. Assistant U.S. Attorney Sharan E. Lieberman was in charge of the prosecution.

Acting U.S. Attorney Duane A. Evans announced that MICHAEL DAVID SORINA, JR., age 38,resident of Slidell, was sentenced after previously pleading guilty to

conspiracy to distribute and possess with intent to distribute one kilogram or more of heroin.

U.S. District Judge Carl J. Barbier sentenced SORINA to 120 months incarceration, followed by 10 years of supervised release.

On July 25, 2014, SORINA, was one of 12 defendants charged in a 23-count indictment. According to court documents, this investigation targeted a heroin trafficking organization operating in New Orleans East. This organization was responsible for distributing at least 15 kilograms of heroin in New Orleans. Agents seized approximately $1,200,000 in assets (a combination of vehicles, currency, jewelry and real property) from members of this drug trafficking organization that were acquired with proceeds made from the sale of heroin.

Co-defendants include:

LARRY HARDY pled guilty to conspiracy to possess with intent to distribute one kilogram or more of heroin and was sentenced to 90 months incarceration.

AMBROSE WILLIAMS pled guilty to conspiracy to possess with intent to distribute one kilogram or more of heroin and was sentenced to 120 months incarceration.

ANTOINETTE KELLY pled guilty to distribution of heroin and was sentenced to 15 months incarceration.

CHRISTOPHER FRANCIS pled guilty to conspiracy to possess with intent to distribute one kilogram or more of heroin and was sentenced to 240 months incarceration.

RODNEY MACK pled guilty to conspiracy to possess with intent to distribute one kilogram or more of heroin and was sentenced to 120 months incarceration.

THOMAS HARRISON pled guilty to conspiracy to possess with intent to distribute one kilogram or more of heroin and was sentenced to 144 months incarceration.

VINCENT P. JONES pled guilty to conspiracy to possess with intent to distribute one kilogram or more of heroin and was sentenced to 180 months incarceration.

BETH MARIE NGUYEN pled guilty to conspiracy to possess with intent to distribute one kilogram or more of heroin and was sentenced to 36 months incarceration.

RICKY MARQUETTE BOZEMAN pled guilty to conspiracy to possess with intent to distribute 100 grams or more of heroin and was sentenced to 144 months incarceration.

TERRELL CARNEY pled guilty to conspiracy to possess with intent to distribute one kilogram or more of heroin and is scheduled to be sentenced on 7/20/2017.

ANTOINE SMITH pled guilty to conspiracy to possess with intent to distribute one kilogram or more of heroin and is scheduled to be sentenced on 9/21/2017.

Acting U.S. Attorney Duane A. Evansannounced that DONALD EALY, a/k/a “Deebo,”age 38, of New Orleans, was sentenced today after previously pleading guilty to conspiring to distribute and possess with intent to distribute one kilogram or more of heroin.

U.S. District Judge Carl J. Barbier sentenced EALY to 60 months incarceration, followed by 5 years of supervised release.

EALY was one of eight defendants charged in a 21-count superseding indictment on September 18, 2015. According to court documents, the superseding indictment originated from an FBI investigation into a heroin-trafficking organization operating primarily around Loyola Avenue and Harmony Street in Central City, New Orleans. The sources of heroin for this organization traveled via Megabus from Houston to New Orleans, carrying half-kilogram quantities of heroin for distribution in the New Orleans area.

The group’s two Houston-based heroin suppliers,defendants MARTHA QUINONES and KEVINGONZALEZ,each pled guilty to conspiring to distribute and possess with intent to distribute one kilogram or more of heroin, and were sentenced to 120 months and 57 months imprisonment, respectively. Defendant REGINALD WASHINGTON pled guilty to conspiring to distribute and possess with intent to distribute 100 grams or more of heroin, and was sentenced to 120 months imprisonment. Defendants EARL BROWN and WILBERT CLARK pled guilty to conspiring to distribute and possess with intent to distribute a quantity of heroin, and were each sentenced to 30 months imprisonment. Two other defendants, THOMAS GORDON and KENNETH HARRIS, have pled guilty to conspiring to distribute and possess with intent to distribute one kilogram or more of heroin, and will be sentenced on August 24, 2017.

Acting U.S. Attorney Evans praised the work of the Federal Bureau of Investigation New Orleans Gang Task Force (NOGTF), which includes FBI, the Saint Tammany Parish Sheriff’s Office, the Jefferson Parish Sheriff’s Office, and the New Orleans Police Department. Assistant United States Attorney Brandon S. Long was responsible for the prosecution.

ActingU.S. Attorney Duane A. Evans announced that DARRYL LEWIS, a/k/a “Uncle Tom,” a/k/a “Poppa Tom,” age 63, and DEMOINDE ROWLEY, a/k/a “Chuck,” age 40, both of New Orleans, were sentenced today after previously pleading guilty to federal narcotics charges.

DARRYL LEWIS was a street-level dealer in the conspiracy. He sold heroin to customers in the Seventh Ward of New Orleans with several co-conspirators. LEWIS also stored firearms for his co-conspirators and served as a “tester” of heroin. He pled guilty to conspiracy to distribute heroin. U.S. District Judge Carl J. Barbier sentenced him to a term of time served (approximately 31 months) in prison, and a supervised release term of 3 years.

DEMOINDE ROWLEY likewise was a street-level dealer who purchased heroin from members of the Seventh Ward-based conspiracy. He also pleaded guilty to conspiracy to distribute heroin. U.S. District Judge Carl J. Barbier sentenced ROWLEY to five years of probation.

Acting U.S. Attorney Evans praised the work of the FBI New Orleans Field Office. Assistance was provided by the DEA New Orleans Field Division, the New Orleans Police Department, the Major Crimes Task Force, the FBI Kansas City Division (Jefferson City Resident Office), and the St. Louis County Police Department. Assistant United States Attorneys Matthew Payne, Shirin Hakimzadeh, and Andre Lagarde are in charge of prosecution.

SACRAMENTO, Calif. — In a unanimous opinion, the U.S. Court of Appeals for the Ninth Circuit today affirmed the denial of relief from judgment for Sierra Pacific Industries and the other defendants held responsible for the Moonlight Fire in a settlement they entered with the United States five years ago.[1]

U.S. Attorney Phillip A. Talbert said, “We are gratified but not surprised by today’s decision, which helps make an important point this fire season. When negligent logging operations cause massive forest fires, this Office will respond with exactly the kind of tenacious, professional advocacy shown by Assistant U.S. Attorneys David Shelledy, Kelli Taylor and the rest of the team. Consistent with the best traditions of the U.S. Department of Justice, our office will continue to hold the careless to account.”

The fire started on Labor Day 2007 and burned over 46,000 acres of the Plumas and Lassen National Forests before it could be extinguished. In a complaint filed in 2010, the United States alleged that the fire started and escaped due to the neglect by Sierra Pacific and one of its contractors in operating bulldozers on a remote logging site on a “red flag” warning day. The contractor’s employees abandoned the job site to get a soda and cellphone soon after completing work, without inspecting the area to ensure they had not started a fire, as required by company policy and state law. The same contractor started two other fires the same summer working on other projects for Sierra Pacific. Sierra Pacific knew the contractor had started one of those fires yet took no action to ensure fire safety.

After litigation commenced, the contractor formally admitted that the fire started in its work area where no one but its employees was seen all day. Sierra Pacific, however, engaged in extensive litigation in an effort to avoid responsibility.

In 2012, the district court in Sacramento ruled that Sierra Pacific could present at trial some of its claims that the government engaged in fraud in attributing blame for the fire. However, in July 2012, Sierra Pacific and the other defendants averted trial by entering a settlement.

In exchange for dismissal of the United States’ complaint, the defendants agreed to pay a total of $55 million in cash. Sierra Pacific’s share of the settlement was $47 million and a conveyance of 22,500 acres of undeveloped land for incorporation into the National Forest System.

With a total value of at least $122.5 million, the settlement is the largest ever received by the United States for damages caused by a forest fire. All of the settlement payments are now complete. Land transfers totaling more than 12,000 acres have been completed with the remainder ongoing.

In the settlement agreement, Sierra Pacific and the other defendants specifically agreed to release all claims—known or unknown. Nonetheless, in October 2014, they filed a motion for relief from judgment, seeking to back out of the settlement based on allegations of fraud. Almost all accusations in the motion repeated the baseless claims made by Sierra Pacific in litigation before the settlement.

In April 2015, U.S. District Judge William B. Shubb issued a detailed 63-page order denying the motion and emphatically rejecting every allegation by Sierra Pacific’s counsel that there was fraud on the court.[2] After an exhaustive review of the law and the record, Judge Shubb concluded that the defendants “failed to identify even a single instance of fraud on the court, certainly none on the part of any attorney for the government. They repeatedly argue that fraud on the court can be found by considering the totality of the allegations. . . . Stripped of all its bluster, defendants’ motion is wholly devoid of any substance.” This is the order affirmed today by the court of appeals.

In a unanimous, 34-page opinion the Ninth Circuit ruled that “[a]fter voluntarily settling this case and asking the district court to enter judgment based on that settlement,” the defendants’ allegations of newly discovered fraud failed to meet the high showing required for relief from judgment. The court ruled that all accusations of fraud discovered before the settlement were legally insufficient — whether those accusations were true or not — because Sierra Pacific and the other defendants “voluntarily settled instead of going to trial.” The settlement agreement also precluded all accusations that the defendants claimed to have discovered after settlement, the court explained, because under the express terms of the settlement agreement, the defendants “bound themselves not to seek future relief, even for fraud on the court.” And finally, the court ruled that even if the settlement terms did not bar relief, “we conclude [those accusations] do not constitute fraud on the court.”

The court specifically rejected Sierra Pacific’s claim that an Assistant U.S. Attorney encouraged perjury by telling a federal investigator the government’s lawyers considered Sierra Pacific’s core scandal claim (that a white flag at the fire investigation scene marked the initial, “concealed” point of origin) to be “a non-issue.” The court explained that this comment was “merely an opinion about the relative importance of an element of the case; . . . not an instruction to commit perjury.”

Despite Sierra Pacific’s inflammatory accusations against the Assistant U.S. Attorneys representing the government in this case, not one of the number of federal judges to have issued rulings before and after settlement have sustained any of those accusations.