DALLAS— A Cleburne woman, Linzi Ladawn Shifflett, was sentenced yesterday by U.S. District Judge Jane J. Boyle to 720 months in federal prison and a lifetime of supervised release, following her guilty plea to two counts of production of child pornography, announced U.S. Attorney Erin Nealy Cox of the Northern District of Texas.

Shifflett, 29, has been in custody since October 2016.    

According to the plea agreement factual resume and information presented at the sentencing hearing, from at least February 25, 2016 through September 28, 2016, Shifflett molested a four-year-old minor child who was in Shifflett’s custody and took sexually explicit photographs and videos of the child. Shifflett then sold the child pornography for nominal amounts of money to a man in Florida. As a part of the sentence, the Court ordered Shifflett to pay $194,815.17 in restitution.

Michael Eugene Williams, the man in Florida who paid for the child pornography, is being separately prosecuted by the U.S. Attorney’s Office for the Middle District of Florida.  He has pleaded guilty to one count of sex trafficking of a child.  His sentencing hearing is currently scheduled for January 29, 2018.       

The case was brought as part of Project Safe Childhood, a nationwide initiative launched in 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse.  Led by U.S. Attorney’s Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood leverages federal, state and local resources to better investigate, apprehend and prosecute individuals who sexually exploit children.  Project Safe Childhood also prioritizes identifying and rescuing victims.  For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/.  For more information about internet safety education, please visit http://www.justice.gov/psc/ and click on the tab “resources.”

The investigation was conducted by the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), the Cleburne Police Department in Texas, and the Jacksonville Police Department in Florida.  Assistant U.S. Attorney Jamie L. Hoxie prosecuted.

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Paul Smith, of Wayne, Pennsylvania, was charged yesterday by Information with mail fraud and securities fraud, announced United States Attorney Louis D. Lappen.  These charges arise from the defendant’s operation of “the Haverford Group,” which the defendant promoted as a stock investment club, but which was actually a Ponzi scheme. 

If convicted, Smith faces a maximum possible sentence of 40 years’ imprisonment, a three-year period of supervised release, a $5,250,000 fine, and a $300 special assessment.  Full restitution of as much as $886,214 also shall be ordered.

The case was investigated by the Federal Bureau of Investigation with assistance from the Securities and Exchange Commission, and is being prosecuted by Assistant United States Attorney Karen L. Grigsby.

An Indictment, Information or Criminal Complaint is an accusation.  A defendant is presumed

innocent unless and until proven guilty.

WILLIAMSPORT – The United States Attorney’s Office for the Middle District of Pennsylvania announced today that U.S. District Court Judge Matthew W. Brann sentenced two federal inmates separately for possessing weapons in prison.

According to United States Attorney David J. Freed, Jeremy Harwell, age 30, an inmate at the Federal Correctional Institute (“FCI”) Allenwood, was sentenced to 18 months’ imprisonment for being in possession of a homemade weapon made out of wood, commonly referred to as a “shank” in December 2016.

Craig Pipps, age 43, an inmate at the United States Penitentiary (“USP”) Allenwood, was sentenced to 20 months’ imprisonment for being in possession of a homemade weapon made out of wood, commonly referred to as a “shank” in December 2016.

Harwell and Pipps each previously pleaded guilty on September 8, 2017. The sentences will be served consecutively to their current periods of federal confinement.    

The investigation was conducted by the Federal Bureau of Investigation, and the Bureau of Prisons Special Investigative Service.  Special Assistant United States Attorney Michael FiggsGanter prosecuted the cases.   

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CLARKSBURG, WEST VIRGINIA – Roger Dale Doehring, of St. Marys, West Virginia was sentenced today to 15 months incarceration for a methamphetamine distribution charge, United States Attorney Bill Powell announced.

Doehring, age 54, pled guilty to one count of “Distribution of Methamphetamine - Aiding and Abetting” in August 2017. Doehring admitted to selling methamphetamine in December 2016 in Pleasants County, West Virginia. 

Assistant U.S. Attorney Stephen D. Warner prosecuted the case on behalf of the government. The West Virginia State Police and the Pleasants County Sheriff’s Office investigated. 

Senior U.S. District Judge Irene M. Keeley presided.

CLARKSBURG, WEST VIRGINIA – Aaron Deshawn Campbell, of Detroit, Michigan, was sentenced today to 96 months incarceration for selling cocaine, United States Attorney Bill Powell announced.

Campbell, also known as “Mike,” age 29, pled guilty to one count of “Distribution of Cocaine Base” in October 2017. Campbell admitted selling crack cocaine in Monongalia County in June 2015. 

Assistant U.S. Attorney Zelda E. Wesley prosecuted the case on behalf of the government. The Mon Metro Drug and Violent Crime Task Force, a HIDTA-funded program, investigated. 

Senior U.S. District Judge Irene M. Keeley presided.
 

          A former financial analyst at Amazon.com, Inc., was sentenced today in U.S. District Court in Seattle to 6 months in prison, a $2500 fine and two years of supervised release for securities fraud involving insider trading, announced U.S. Attorney Annette L. Hayes.  BRETT D. KENNEDY, 27, currently of Blaine, Washington, pleaded guilty in September 2017, admitting that in April 2015, he provided non-public quarterly financial results to a friend who then purchased Amazon stock and sold it at a profit once the results were made public.  The friend paid KENNEDY for this inside information.  KENNEDY is no longer employed by Amazon.  At sentencing Chief U.S. District Judge Ricardo Martinez said, “This is a serious offense.  If the public cannot have confidence in the financial markets it impacts the entire country.”

          “Those who trade on inside information fundamentally undermine the trust that is necessary for our financial markets to operate,” said U.S. Attorney Annette L. Hayes.  “Those responsible – like the defendant in this case – will be held accountable.  I commend the Federal Bureau of Investigation and the Securities and Exchange Commission for their work to ensure that those responsible for this type of financial crime are held to account.”

          According to the information filed in the case, KENNEDY began work as a financial analyst at Amazon in 2013.  As part of his employment he signed a confidentiality statement that he would not disclose Amazon’s non-public financial information outside the company.  The policy specifically mentions information such as earnings and losses as material confidential information.  In April 2015, KENNEDY used his access to view and write down Amazon first quarter earnings that were going to be announced later in the month.  KENNEDY provided this information to his friend.  After viewing the information, the friend purchased 4400 shares of Amazon stock for $1.7 million.  When the positive earnings news was announced publicly, and the stock price rose, the friend sold the shares for a gain of nearly $116,000.  The friend paid KENNEDY $10,000 in cash for the information. 

          Speaking to the court, Kennedy apologized to his family and to Amazon saying, “I threw my success away in an instant . . . I wish every day I could go back and not be so stupid and reckless.”

          The Securities and Exchange Commission filed civil charges against KENNEDY.  In its complaint it identifies the friend as Maziar Rezakhani, and names him as a defendant.  Rezakhani, 28, is currently serving a five year prison term for defrauding a bank, Apple, Inc., and various shipping and insurance companies.  The insider trading investigation grew out of the investigation into Rezakhani’s frauds.  The SEC is seeking disgorgement of all profits from Rezakhani’s alleged illegal trading.  KENNEDY agreed to a settlement with the SEC.  Details of the SEC action are available here.

          The case was investigated by the FBI.  The case was prosecuted by Assistant United States Attorney Brian Werner.

Alleged to have sold large quantities of methamphetamine in Indiana and Kentucky

New Albany – Josh J. Minkler, United States Attorney for the Southern District of Indiana and Russell M. Coleman, United States Attorney for the Western District of Kentucky, announced today the dismantling of a large drug trafficking organization (DTO) selling methamphetamine in Indiana and Kentucky.

“Drug trafficking brings gun violence that many of our Midwestern communities are experiencing,” said Minkler. “Those who choose to sell drugs in our neighborhoods will experience the full brunt of federal law enforcement and realize the Ohio River will not stifle or cooperative effort between law enforcement agencies.”

“The Department of Justice and our law enforcement partners stood shoulder to shoulder last week to promise intelligence-driven targeting of these violent drug trafficking organizations harming this great city,” said U.S. Attorney Russell Coleman. “Today’s arrests are yet another deposit on this promise; stay tuned.”

Those charged in the Southern District of Indiana with conspiracy to distribute methamphetamine include: Clifton Jones, 31, Gregory Churchill, 33, and Stanley Duke, Jr., 41 all from Louisville;  Billy Dale Sears, 44, Harry Edelen, 44, Roger Carroll, Jr., 47, from New Albany, Indiana; and Chad Albertson, 40, from Salem, Indiana. Duke faces an additional charge of possession of a firearm by a convicted felon.

            The indictment alleges that Billy Dale Sears was the leader and supervisor of the DTO which conspired to distribute large quantities of methamphetamine. Sears would obtain the methamphetamine from Clifton Jones and Gregory Churchill who both lived in Louisville. Sears would then distribute the methamphetamine to mid-level dealers in New Albany, Jeffersonville, Salem and Louisville for redistribution throughout Southwestern Indiana and Northern Kentucky.

Throughout the conspiracy, it is alleged that the DTO sold methamphetamine on a “front’ basis, where defendants provided large quantities of methamphetamine on consignment to distributors. Payment was received after the sale by other distributors. The defendants also used telephones, using code language and text messages to discuss matters relative the trafficking operation.

In a separate indictment, returned by a grand jury in Louisville on December 5, 2017, and unsealed today, eleven defendants, all from Louisville, were charged in a single count with conspiring with each other to possess with the intent to distribute 50 grams or more of methamphetamine, a Schedule II controlled substance.

            Defendant Clifton Jones additionally faces charges in the Western District of Kentucky, along with co-defendants Dontay L. Rice, Eric R. Estey, 35,  Dandre L. Taylor, 35, Odell P. Smith, Jr., 34, William C. Freeman, 32, James E. Hall, 33, Chad J. Heiser, 37, Clarence W. Rice, Jr., Alex M. Bowles, 25, and Joseph R. Willis, 21.

             All but defendant Heiser were arrested Thursday, and are in federal custody. Defendants charged in the WDKY are scheduled for an initial appearance before Magistrate Judge Dave Whalin, in Louisville, at 2:00pm. Defendants charged in the Southern District of Indiana were scheduled to appear Friday morning before Magistrate Judge Van T. Willis.

This case was investigated by the Federal Bureau of Investigation in Indiana and Kentucky, IRS Criminal Investigation, ATF, United States Marshal Service, Jeffersonville Police Department, New Albany Police Department, Clarksville Police Department, Clark County Sheriff’s Department, Harrison County Sheriff’s Department, Indiana State Police and the Louisville Metro Police Department.

“Working collaboratively with our federal, state, and local partners we are able to target, disrupt and dismantle criminal enterprises such as this that use violence in the commission of their illegal activities so they can no longer terrorize our communities,” said W. Jay Abbott, Special Agent in Charge of the FBI’s Indianapolis Division. 

“The FBI and its partners remain dedicated to disrupting and dismantling the most violent offenders and organizations through intelligence-driven investigations,” said Amy S. Hess, Special Agent in Charge FBI Louisville. “Our goal remains the same: stop the violence, get drugs and weapons off the streets, and deliver justice for the people who live in the communities we serve.”

According to Assistant United States Attorney Lauren M. Wheatley who is prosecuting this case for the Southern District of Indiana and Assistant United States Attorney J. Scott Davis, from the Western District of Kentucky, all defendants face ten years to life if convicted.

An indictment is merely a charge and not evidence of guilt. All defendants are considered innocent until proven guilty in federal court.

Columbia, South Carolina ---- United States Attorney Beth Drake stated today that Colby L. Simmons, age 35, of Lithia Springs, Georgia, was found guilty by a jury in federal court in Anderson, for his involvement in a conspiracy to pass Treasury checks of the United States bearing falsely made or forged endorsements, a violation of Title 18, United States Code, Section 371, and making false statements to federal authorities, a violation of Title 18, United States Code, Section 1001. United States District Judge Timothy M. Cain, of Anderson, presided over the trial and will impose sentence after he has reviewed the presentence report which will be prepared by the U.S. Probation Office. 

Evidence presented at the trial established that there was a multistate conspiracy, beginning in or about June 2013, to steal Treasury checks and cash them.  The checks belonged to disabled veterans, retired federal employees, and current federal employees. Several victims appeared at trial and testified about having automobiles repossessed, no money for Christmas gifts, and loss of homes because of the thefts.  

The investigation focused on Simmons beginning in June 2014 during a car stop on I-85.  Greenville County deputies stopped Simmons and found a Treasury check that did not belong to Simmons and $10,000 in proceeds from the cashing of Treasury checks.  On top of the check recovered there was written the driver’s license number of Brandy D. Page, a co-conspirator from Cowpens, South Carolina, who has pled guilty and is awaiting sentencing. The check was sent to the laboratory and it came back as having on it the fingerprints belonging to Joshua A. Martin, a co-conspirator from Spartanburg, South Carolina, who has pled guilty and is awaiting sentencing.  Martin and Page arrested some months after the stop of Simmons’ vehicle and confessed to their involvement.

In December 2014, Wal-Mart in Boiling Springs reported that it was the victim of approximately $200,000 in reclamations related to the cashing of Treasury checks.  Three cashiers were interviewed and several picked Page out of a line up as a person who cashes multiple Treasury checks in the store.  Cashiers also identified Josh Martin as cashing multiple Treasury checks. 

In January 2015, the Greer Wal-Mart reported approximately $75,000 in reclamations related to the cashing of Treasury checks.  On many of these checks there were written Page’s driver’s license number and date of birth.  Others had Martin’s driver’s license number and date of birth.  The store also had on file fake power of attorney forms that Page and Martin had used to cash the checks.

Investigation revealed that Page and Martin began cashing checks for Simmons in the summer of 2013.  During the initial meeting with Simmons, Page received three to four (3-4) checks. There were many more meetings in which checks were provided to Page and Martin and proceeds from the cashing of the checks were given to Simmons.  Simmons brought Treasury checks to Page approximately one to two times per month for at least eighteen (18) months.

Ms. Drake stated the maximum penalty Simmons can receive on both charges is a fine of $250,000 and/or imprisonment for 5 years, plus a special assessment of $100.

The case was investigated by agents of the Greer Police Department, the Greenville County Sheriff’s Office, the Internal Revenue Service, the United States Postal Inspection Service, and the Department of Homeland Security, Office of Investigations. Assistant United States Attorney Bill Watkins of the Greenville office handled the case.

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The Justice Department announced today that IBERIABANK Corporation, IBERIABANK and IBERIABANK Mortgage Company (collectively, IBERIABANK) have agreed to pay the United States $11,692,149 to resolve allegations that they violated the False Claims Act by falsely certifying they were complying with Federal requirements in order to obtain insurance on mortgage loans from the Federal Housing Administration (FHA), part of the U.S. Department of Housing and Urban Development (HUD).  IBERIABANK Corporation is headquartered in Lafayette, Louisiana, with branches across the Southeast, including Arkansas.

“Mortgage lenders must follow FHA program rules designed to avoid putting federal funds at risk and increasing the chances that borrowers may lose their homes,” said Principal Deputy Assistant Attorney General Chad A. Readler, head of the Justice Department’s Civil Division.  “The Department will continue to hold accountable lenders that knowingly violate material program requirements that cause the government to guarantee ineligible loans.”

During the time period covered by the settlement, IBERIABANK participated as a direct endorsement (DE) lender in the FHA insurance program.  A DE lender has the authority to originate, underwrite and endorse mortgages for FHA insurance.  If a DE lender approves a mortgage loan for FHA insurance and the loan later defaults, the holder of the loan may submit an insurance claim to HUD, FHA’s parent agency, for the losses resulting from the defaulted loan.  Under the DE program, the FHA does not review a loan for compliance with FHA requirements before it is endorsed for FHA insurance.  DE lenders are, therefore, required to follow program rules designed to ensure that they are properly underwriting and certifying mortgages for FHA insurance, to maintain a quality control program that can prevent and correct deficiencies in their underwriting practices, and to self-report any deficient loans identified by their quality control program.  FHA rules also prohibit the payment of commissions to lender underwriting staff in order to avoid improper incentives.  DE lenders such as IBERIABANK certify compliance with material FHA requirements.

As part of the settlement, IBERIABANK admitted to the following facts:

Between Jan. 1, 2005, and Dec. 31, 2014, IBERIABANK certified for FHA insurance mortgage loans that did not meet HUD underwriting and origination requirements and were, therefore, ineligible for FHA mortgage insurance under the DE program.  HUD paid FHA insurance claims on certain of these ineligible mortgages, and these included ones where IBERIABANK’s loan files contained inadequate documentation of the borrower’s income, unresolved appraisal discrepancies concerning declining home values in the relevant neighborhood, and inadequate verification related to the borrower’s down payment. 

Between 2005 and 2014, IBERIABANK paid incentive payments to underwriters and others who performed underwriting activities.  After a HUD review of IBERIABANK in 2010 notified the Bank that it was not in compliance with the underwriter commission prohibition, IBERIABANK advised HUD that it was no longer paying underwriter commissions.  However, the Bank did not disclose to HUD that it was paying underwriters incentive payments and that it continued to do so through 2014.

Between 2005 and 2014, IBERIABANK did not timely self-report material violations of HUD requirements.  Internal IBERIABANK audits and reviews during this time period found that the Bank’s quality reviews were not being performed in a timely manner and did not comply with other HUD requirements.

As a result of IBERIABANK’s conduct and omissions, HUD insured loans approved by the Bank that were not eligible for FHA mortgage insurance under the DE Program and that HUD would not otherwise have insured.  HUD subsequently incurred losses when it paid insurance claims on those loans.

* * *

 “It is troubling when financial institutions, who have fiduciary responsibilities and are expected to conduct themselves as honest brokers, wrongfully exploit federally funded programs,” said Jeremy Kirkland, Acting Deputy Inspector General, HUD Office of Inspector General.  “This settlement demonstrates HUD OIG’s commitment to work with our partners, under the False Claims Act, to combat fraud against the Government.  Today’s settlement should serve as a cautionary tale that we will continue to aggressively utilize it in pursuit of those that seek to undermine federal housing programs,” he concluded.

The allegations resolved by this settlement arose from a whistleblower lawsuit filed under the False Claims Act by former employees of IBERIABANK, Kelley R. Shackleford and Karen Mills, who were employed with IBERIABANK in Little Rock, Arkansas.  Under the False Claims Act, private citizens can sue on behalf of the government and share in any recovery.  The whistleblowers will receive a 20 percent share of the recovery.

The settlement was the result of a joint investigation conducted by HUD, HUD’s Office of Inspector General, the Civil Division and the U.S. Attorney’s Office for the Eastern District of Arkansas.

The lawsuit is captioned United States ex rel. Shackleford v. IBERIABANK, 4:15-cv-416 (E.D. Ark.).  Other than the facts admitted by IBERIABANK, the claims asserted against IBERIABANK are allegations only, and there has been no determination of liability.

St. Thomas, USVI – Devon Davis, 27, Keon Wilson, 22, and Shawn McIntosh, 24, have been arrested after being charged by a superseding indictment with Hobbs Act robbery, conspiracy to commit Hobbs Act robbery, and brandishing a firearm during a federal crime of violence, Acting United States Attorney Joycelyn Hewlett announced. At a hearing today in District Court, Magistrate Judge Ruth Miller ordered Wilson detained pending trial. McIntosh was detained on November 22, 2017, and Davis was released on conditions.

Davis, Wilson, and McIntosh, along with Shaquille Correa, 22, Jarmaine Ayala, 36, Wahilli James, 21, and Ron Delano Kuntz, 42, are charged in a conspiracy to rob Gems and Gold Corner Jewelry Store on St. Thomas.

According to the superseding indictment, on September 16, 2013, the seven men conspired with each other and other unidentified co-conspirators to rob the store, brandished weapons to threaten and intimidate store employees, and then fled the store with merchandise.

If convicted, each of the seven men face up to 20 years in prison on the Hobbs Act robbery charge, plus a mandatory seven-year consecutive sentence for the brandishing a firearm charge.

This case is being investigated by the Virgin Islands Police Department and the Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorneys Anna A. Vlasova and Kim L. Chisholm.

Acting United States Attorney Hewlett reminds the public that an indictment is merely a formal charging document and is not evidence of guilt. Every defendant is presumed innocent until and unless proven guilty.

LEXINGTON, Ky. – A federal grand jury in Lexington has indicted an Adair County man, on a charge of conspiracy to commit mail fraud, wire fraud and securities fraud, arising out of an oil and gas exploration investment scheme.  As alleged in the indictment, from 2007 until 2017, Ronnie C. Rodgers, 62, of Columbia, Ky., solicited investors in oil and gas production programs involving oil and gas leases, in South Central Kentucky and Tennessee.  He solicited these investors under various business names, including Rick-Rod Oil Company, Inc.; Big South Resources; Big South Energy; Hydro & Green Global Energy, LLC; and R&R Plus, LLC. 

The indictment alleges a scheme in which Rodgers and his associates profited from misappropriating investor money, rather than from the sale of oil and gas.  Rogers is alleged to have obtained money from the investors by making false representations and by failing to advise them of facts, which were material to their investments.  These misrepresentations included predictions about the amount of expected oil production, statements about when the investors could expect a return of their investment, claims that oil was already being produced, and other similar misrepresentations.   According to the indictment, Rodgers also failed to disclose that he was a convicted felon; that he had been enjoined by state authorities from selling oil and gas investments; and that he had mostly drilled dry wells. 

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Chris White, Assistant Inspector in Charge, U.S. Postal Inspection Service; and Charles A. Vice, Commissioner of the Kentucky Department of Financial Institutions, jointly announced the indictment.  The indictment results from a joint investigation by the United States Postal Inspection Service and the Kentucky Department of Financial Institutions.  

            An indictment is an accusation only. A defendant is presumed innocent and is entitled to a fair trial, at which the government must prove guilt beyond a reasonable doubt.

HAMMOND –United States Attorney for the Northern District of Indiana, Thomas L. Kirsch II, announced that Hulian Terrell III, age 34, of Schererville, IN, was sentenced before Hammond Senior Judge James T. Moody for filing false claims and identity theft. 

Terrell was sentenced to 27 months followed by 2 years of supervised release.  Terrell was also ordered to pay restitution in the amount of $551,647.

According to documents in this case, the defendant pleaded guilty to filing fraudulent federal and state tax returns utilizing the names, dates of birth, and social security numbers of incarcerated individuals without their knowledge, authority, or permission.  Terrell obtained the personal identifying information of these individuals by accessing various websites including Department of Corrections’ websites.  The fraudulent refunds were received through the United States Mail and electronically.  These fraudulent filings led to fraudulent federal and state refunds being issued in the names of these individuals, but received by the defendant.

This case was investigated by the Internal Revenue Service, Criminal Investigations Division, the United States Postal Inspection Service, the United States Secret Service, and the Social Security Administration, Office of Inspector General.  The case was handled by Assistant U.S. Attorney Toi Denise Houston.

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HAMMOND –United States Attorney for the Northern District of Indiana, Thomas L. Kirsch II, announced that Lloyd Bruce, 43, of Hammond, IN, was sentenced on December 7, 2017 by District Court Judge James T. Moody for conspiracy to distribute cocaine and crack cocaine along with possession of a firearm in furtherance of a drug trafficking crime.  

Bruce was sentenced to 168 months imprisonment and 3 years of supervised release. 

According to Court filings, in April of 2015, Bruce was arrested and charged by the State of Indiana for possession with the intent to deliver cocaine and for carrying a firearm without a license.  While on bond for his 2015 offense, Bruce purchased a building in East Chicago with the stated purpose of turning it into a “social club”.  In the fall of 2016, the DEA linked Bruce to a drug trafficking organization operating out of East Chicago and learned that Bruce was utilizing the “social club” to sell crack cocaine procured from another member of the drug trafficking organization.  The DEA intercepted phone calls between Bruce and one of his co-conspirators where they utilized code language to discuss Bruce’s distribution of crack cocaine at the “social club.” With the help of a confidential informant, the DEA also conducted two controlled buys of crack cocaine directly with Bruce at the “social club”. 

This case was investigated by the Drug Enforcement Administration in cooperation with the East Chicago Police Department, Hammond Police Department and the Lake County Prosecutors Office.  This case was prosecuted by Assistant United States Attorney Thomas McGrath.

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ALBUQUERQUE – Arnold Jones, 33, an enrolled member and resident of Laguna Pueblo, N.M., pled guilty today in federal court in Albuquerque, N.M., to a child abuse charge under a plea agreement with the U.S. Attorney’s Office.

Jones was arrested in June 2017, on an indictment charging him with engaging in child abuse by operating a motor vehicle recklessly on Dec. 28, 2015, on the Laguna Pueblo in Cibola County, N.M.

During today’s proceedings, Jones entered a guilty plea to the indictment.  In entering the guilty plea, Jones admitted that on Dec. 28, 2015, he operated a motor vehicle recklessly within the Laguna Pueblo while under the influence of alcohol.  Jones further admitted that his actions endangered the health and wellbeing of his six-year-old child who was a passenger in the vehicle. 

This case was investigated by the Laguna/Acoma Agency of the BIA’s Office of Justice Services and was prosecuted by Assistant U.S. Attorney Elisa C. Dimas.

HAMMOND –United States Attorney for the Northern District of Indiana, Thomas L. Kirsch II, announced that Javon Kennedy, 43, of Merrillville, Indiana, was sentenced on December 7, 2017 by District Court Senior Judge James T. Moody for possession with intent to distribute a controlled substance.

Kennedy was sentenced to 41 months imprisonment followed by 2 years of supervised release. 

According to documents filed in this case, on January 24, 2017, defendant was stopped for speeding in Hobart, Indiana. As the officer approached defendant’s car he noticed defendant’s breathing was heavy and his hands were shaking. Defendant retrieved his driver’s license, registration and insurance from the glove box. The officer noticed a white powdery residue near the center cup holder and asked defendant and his passenger if there was anything illegal in the car.  Kennedy pointed to his female passenger stating “She has it." Officers recovered 25 grams of cocaine from defendant and the passenger.

This case was investigated by the Federal Bureau of Investigation GRIT in cooperation with the Hobart Police Department.  This case was prosecuted by Assistant United States Attorney Thomas Mahoney.

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DALLAS — Gary Busby, 65, formerly of Flower Mound, Texas, was sentenced this morning by U.S. District Judge Sam A. Lindsay to 78 months in federal prison for his role in a conspiracy to illegally manufacture firearms that were sent to Mexico, announced U.S. Attorney Erin Nealy Cox of the Northern District of Texas.

Busby was convicted in March 2017, following a two-week jury trial, on one count of conspiracy to manufacture firearms without a license and four counts of structuring financial transactions to evade reporting requirements.  Judge Lindsay ordered Busby to surrender to the Bureau of Prisons on March 6, 2018.

According to evidence presented at trial, over the course of 2010 and 2011, Busby manufactured hundreds of AR-15 and AK firearm receivers into fully functional firearms and made thousands of dollars doing so.  Law enforcement found approximately fifty of these firearms. Some were recovered smuggled into Mexico while the rest were recovered by Mexican authorities.

Evidence also showed that from approximately December 2010 to September 2012, Busby purchased hundreds of postal money orders at dozens of post offices in the Dallas-Fort Worth area, in an effort to hide the proceeds of his illegal firearm activity.  Busby would only purchase two $1,000 money orders at a time at one post office, using cash, and would travel to up to six post offices in one day, purchasing $2,000 in money orders at each.  Doing so, he was knowingly evading the federal reporting requirement for when a customer purchases $3,000 or more in money orders.  In 2011 alone, Busby purchased approximately $236,000 in postal money orders, in order to hide the money made manufacturing firearms.  Evidence presented to the jury showed that he knowingly structured these cash transactions.

The Bureau of Alcohol, Tobacco, Firearms and Explosives and the U.S. Postal Inspection Service investigated.  Assistant U.S. Attorney Kate Rumsey and Criminal Chief Chad Meacham prosecuted.

# # #

DALLAS— Crystal Burrows, of Arlington, Texas, was sentenced today by U.S. District Judge Jane J. Boyle to 28 months in federal prison and ordered to pay $320,375 in restitution.  The sentencing follows Burrows’ guilty plea in January 2017 to one count of wire fraud.  The announcement was made by U.S. Attorney Erin Nealy Cox of the Northern District of Texas.

Judge Boyle ordered Burrows to surrender to the Bureau of Prisons on January 17, 2018.

According to documents filed in her case, beginning in 2014, Borrows knowingly and intentionally participated in a scheme to defraud the Internal Revenue Service (IRS).  More specifically, Burrows electronically filed tax returns for the tax year 2013 with her EFIN, and for tax years 2014 and 2015 with EFINs of coconspirators, under taxpayers’ names and social security numbers without the taxpayers’ knowledge or consent.  In total, Burrows prepared and filed at least 22 fraudulent tax returns using stolen identifying information of tax payers.  Burrows also used two stolen social security numbers to establish numerous credit card accounts, a car loan, store accounts, and care credit accounts typically used for medical procedures.

The case was investigated by IRS Criminal Investigation.  Assistant U.S. Attorney Andrew Wirmani is in charge of the prosecution.

# # #

SOUTH BEND - The United States Attorney for the Northern District of Indiana, Thomas L. Kirsch II, announced that Rashawn Moffitt, age 31, of Niles, Michigan, was sentenced before South Bend District Court Judge Robert L. Miller, Jr. for possessing a firearm by a convicted felon.   

Moffitt was sentenced to 54 months imprisonment followed by two (2) years of supervised release. 

According to documents in this case, On May 8, 2017, South Bend Police encountered Rashawn Moffitt in a parking lot as he got out of the driver’s seat of a car.  On the driver’s floorboard of that car was a loaded handgun with an extended magazine. 

This case was investigated by the Bureau of Alcohol, Tobacco and Firearms and the South Bend Police Department.  The case was handled by Assistant U.S. Attorney Joel Gabrielse.

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SALT LAKE CITY – In what is believed to be the largest settlement of its kind in Utah involving allegations of drug diversion, Intermountain Healthcare has agreed to pay the United States $1 million to resolve allegations that lax controls enabled a former employee to divert controlled substances for personal use.
U.S. Attorney John W. Huber and U.S. Drug Enforcement Administration (DEA) District Agent in Charge Brian S. Besser announced the settlement Friday morning.
In conjunction with the monetary settlement, IHC has implemented a comprehensive corrective action plan to prevent, identify, and address future diversions. The settlement is not an admission of liability by Intermountain Healthcare. 
“Under the law, healthcare networks such as IHC have a responsibility to ensure that controlled substances are used for patient care and are not diverted for non-medical purposes,” Huber said.  “Diversion of these drugs feeds addiction, contributes to potential illegal drug sales, and fuels the opioid epidemic that has had a devastating effect on Utah and the rest of the country.  We commend IHC for addressing its diversion problem and for taking steps to ameliorate future diversion by IHC personnel,” Huber said.
The settlement relates to civil claims arising from a diversion of controlled substances at a clinic and pharmacy in the Ogden area. Specifically, the United States contends that from September 2007 through March 2015, a diversion of controlled substances occurred at the clinic under DEA registration numbers for a physician and pharmacy. 
A DEA investigation found that a former medical assistant of a doctor at the clinic used the physician’s DEA registration number to issue prescriptions to herself and two family members, including prescriptions for Oxycodone, Diazepam, Phentermine and Hydrocodone. 
“With the burgeoning opioid epidemic sweeping across the country and the great State of Utah, the DEA takes very seriously its responsibility to ensure the public’s safety in regard
to the proper prescribing and dispensing of highly-addictive controlled substances made available to our communities through the healthcare industry. DEA is committed to investigating any instances involving the unlawful diversion of powerful synthetic opioids with which many Utahan’s woefully begin their cycle of drug addiction,” Besser said today.
The United States contends, for example, that 244 prescriptions of Oxycodone 30 mg tablets (46,616 pills) were issued without a legitimate medical purpose and not in the course of the doctor’s professional practice.  Another 151 prescriptions for controlled substances, totaling 11,430 pills, w ere also issued. The pharmacy filled each of the prescriptions, which were picked up by the former medical assistant.  The physician and the pharmacy shared equal responsibility for ensuring the proper prescribing and dispensing of the controlled substances, the United States contends.
The Affirmative Civil Enforcement Division in the United States Attorney’s Office handled the civil action.

Larry Westby swindled friends and acquaintances out of nearly $1 million

PRESS RELEASE

Indianapolis B United States Attorney Josh J. Minkler announced today the sentencing of a former Indiana man who stole nearly one million dollars from unsuspecting investors. Larry M. Westby, 65, currently residing in Vanderbilt, Michigan, was sentenced to 90 months (7.5 years) imprisonment by Chief U.S. District Judge Jane Magnus-Stinson after pleading guilty to wire fraud, securities fraud and fraud in the offer or sale of securities.

“Perpetrators of fraud crimes not only jeopardize their victims’ financial security, but they also rob their victims of the trust they once had in their own judgment and in others,” said Minkler. “When a person or business intentionally deceives Indiana investors with promises of financial benefits that do not exist, were never intended to be provided, or were misrepresented, they will be prosecuted by this office to the fullest extent of the law.”  

Westby was a licensed respiratory therapist and president of LMW, Inc., a company purported to be selling respiratory therapy protocols to doctors. The protocols allowed doctors to perform treatments inside their own offices, rather than in a hospital.

In January 2010, Westby began using the LMW website to communicate with current and potential LMW investors indicating he was exploring selling his company for a substantial profit. In these communications, Westby made false statements about the nature of LMW, its financial condition, and the risk and status of investments in LMW.  For example, Westby told potential investors that LMW was about to be sold for $36.5 million to a company called Global Spot in an effort to convince investors to buy LMW common stock.  Unbeknownst to investors, Global Spot was a non-existent, sham entity.  Westby also concealed from his investors that he had not registered LMW with the Indiana Secretary of State as a company properly registered to engage in the issuing of stock certificates. Further Westby did not tell investors that he had failed to properly register LMW common stock certificates with the Secretary of State.

  Through these false communications, Westby took in more than $985,000 from his investors, then used the funds to purchase two vehicles, repay a personal loan, pay personal credit card bills, and buy a vintage basketball court for his home.

This case was jointly investigated by the Federal Bureau of Investigation, Internal Revenue Service-Criminal Investigation and the Indiana Secretary of State.

IRS Criminal Investigation Special Agent in Charge, Gabriel Grchan, stated, “Mr. Westby told convincing stories to cover his tracks; however, at the end of the day his lies didn’t add up and IRS special agents solved the problem.  Together with our federal partners we work vigorously to shut down corrupt, illegal behaviors that threaten honest and lawful investment practices.”

"This sentence sends a clear message that illegal business practices will not be tolerated," said W. Jay Abbott, Special Agent in Charge of the FBI's Indianapolis Division. "The FBI and our law enforcement partners will continue to aggressively pursue individuals who steal money from the pockets of hardworking Hoosiers."

"Mr. Westby was not registered to sell securities with my office," said Secretary of State Connie Lawson. "This is often the number one warning sign that the investment may be a scam. I encourage all investors to do their homework and research investment professionals before making a deal. Hoosiers can ensure their investment professional is registered by looking on our website or by calling our office."

According to Assistant United States Attorney Tiffany J. Preston who is prosecuted this case for the government, Westby must make restitution of over $985,000 and serve three years of supervised release following his sentence.