Opioid overdose rates in Abilene fell precipitously following a large-scale takedown of fentanyl traffickers, announced U.S. Attorney for the Northern District of Texas Leigha Simonton. According to Abilene Police Department data collected by OD MAP, from January 1, 2024 to September 11, 2024, Abilene suffered 41 overdoses, including nine that were fatal, for an average of 4.9 overdoses per month. Victims ranged in age from 13 to 72. On September 11, a federal grand jury indicted 12 alleged fentanyl traffickers who were arrested the next week. All were detained pending trial.  Following that takedown, Abilene saw just three overdoses, none of them fatal, through the end of the year, for an average of 0.8 overdoses per month. In addition, according to the Taylor County Sheriff’s Office, the street price of fentanyl pills rose from roughly $8 per pill to between $20 and $30 per pill, making fentanyl less accessible to at-risk users.“This is precisely why the U.S. Attorney’s Office does the work it does – and why I am proud to have led the Northern District of Texas for the past two years,” said U.S. Attorney Leigha Simonton. “To see our fentanyl prosecutions having tangible impacts on the lives of the people of Abilene is immensely gratifying. I want to laud the hard work of our local law enforcement partners, especially the Abilene Police Department and the Taylor County Sheriff’s Office, for helping to make this happen.”To date, 10 of the 12 defendants indicted on Sept. 11 have entered guilty pleas and await sentencing. The other two await trial and are presumed innocent until proven guilty in a court of law. Agencies involved in the fight against fentanyl in the region include the Abilene Police Department, the Taylor County Sheriff’s Office, the Drug Enforcement Administration’s Dallas Field Office, and the Federal Bureau of Investigation’s Dallas Field Office – all members of North Texas HIDTA and the OCEDTF Program. The Fort Worth Branch of the United States’s Attorney’s Office is prosecuting the case. Organized Crime Drug Enforcement Task Forces (OCDETF) identify, disrupt, and dismantle the highest-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threat the United States by using a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks. 

Trivikram Reddy, 43, a Waxahachie nurse practitioner previously convicted of wire fraud conspiracy and sentenced to 20 years in 2021, will now forfeit over $40 million from foreign accounts into which he moved the funds, announced Acting U.S. Attorney Chad E. Meacham.  Following Mr. Reddy’s conviction, the government filed a civil forfeiture action alleging that Mr. Reddy and others transferred and laundered the fraud proceeds to nearly 200 bank accounts located in India.  Through forensic financial analysis, the government traced the proceeds to these accounts and obtained seizure warrants to forfeit and restrain the funds.  On Monday, March 3, 2025, after Mr. Reddy and two family members stipulated up to $41,237,703.16 of the funds’ return from India, U.S. District Judge Ada Brown issued a judgment ordering the funds to be transferred to U.S. government custody.  According to court documents, Mr. Reddy, a licensed nurse practitioner, devised a scheme to defraud Medicare, Blue Cross Blue Shield of Texas, Aetna, UnitedHealthcare, Humana, and Cigna.  Mr. Reddy and co-conspirators created false patient bills using the provider numbers of six doctors as the treating physicians on the claims.  All the claims were false, as none of the six doctors provided billable services to any of Mr. Reddy’s medical clinics.  In response to federal agents’ investigative inquiries, Mr. Reddy and his staff manufactured fake medical records in a failed attempt to justify the false claims.  Mr. Reddy pleaded guilty to conspiracy to commit wire fraud in October 2020.  In May 2021, Judge Brown sentenced Mr. Reddy to 20 years imprisonment and ordered over $50 million in restitution to the victims of his offense.The civil forfeiture case is being handled by Assistant U.S. Attorney Dimitri Rocha.  Assistant U.S. Attorney Beverly Chapman is handling the restitution.  The case was investigated by the FBI Dallas Field office and Health and Human Services-Office of Inspector General (HHS-OIG).   

WASHINGTON — A Dallas, Texas, grand jury returned two indictments today against five Chinese citizens and four companies alleging fraud and other charges, the Justice Department announced. The charges relate to alleged sales of stimulants intended for inclusion in dietary supplements.

The indictments charge the defendants with participation in a scheme to produce and sell dietary supplements containing hidden synthetic stimulants, such as 2-amino-6-methylheptane (“DMHA”). The charges also involve alleged shipments of 1,3-dimethylamylamine (“DMAA”) and DMHA. DMAA, which is chemically similar to DMHA, has been linked to severe adverse events such as heart attacks and strokes.

The indictments allege that the defendants knew major American dietary supplement retailers would not carry supplements containing these stimulant ingredients. The indictments also allege the defendants agreed with a confidential government informant to either mislabel ingredients or otherwise help to hide the true nature of a proposed dietary supplement from retailers. None of the ingredients allegedly shipped during the undercover investigation were sold to consumers. 

“It is unlawful for companies both outside and inside the United States to conceal questionable, dangerous, or illegal ingredients in dietary supplements sold to American consumers,” said Chad A. Readler, Acting Assistant Attorney General of the Department of Justice’s Civil Division. “These cases demonstrate the Department of Justice’s commitment to ensuring that dietary supplements are safe and accurately labeled.”

“U.S. consumers trust that their dietary supplements are safe and contain appropriate labeling. When unscrupulous producers add undeclared or misidentified ingredients to dietary supplements, there is no assurance that the product is safe for consumption,” said Catherine A. Hermsen, Acting Director, FDA Office of Criminal Investigations. “The FDA will continue to pursue and bring to justice those who participate in fraudulently marketing dietary supplements to the detriment of public health.”

The first indictment charges Genabolix USA Inc., a Nevada corporation; Shanghai Yongyi Bioltechnology Ltd., a Chinese corporation; Hu Chang Chun (a.k.a. James Hu), 44, of Shanghai, China, the principal of Genabolix; Gao Mei Fang (a.k.a. Amy Gao), 41, of Shanghai, China, the supply chain manager for Genabolix; and Zhang Xiao Dong (a.k.a. Mark Zhang), 31, of Shanghai, China, the sales manager for Genabolix, with mail fraud. The indictment also charges Genabolix, Shanghai Yongyi, Hu, and Gao with introducing misbranded food into interstate commerce. In addition, the indictment charges Genabolix, Yongyi, and Gao with obstruction of an agency proceeding and smuggling. 

A second indictment charges Shanghai Waseta International Trade Co. Ltd., a Chinese corporation; Max Pharmatech Inc., a California corporation; Xu Jia Bao (a.k.a. Fred Xu), 48, of Shanghai, China, the principal of Shanghai Waseta; and Li Ting Ting (a.k.a. Sunny Lee), 37, of Shanghai, China, the overseas sales manager for Shanghai Waseta, with wire fraud and with introducing misbranded food into interstate commerce. The indictment also charges Shanghai Waseta with smuggling.

Gao Mei Fang, Zhang Xiao Dong, and Xu Jia Bao were arrested in late September at a dietary supplement trade show in Las Vegas and remain in custody. A date for trial before the federal district court in Dallas has not yet been set. The remaining individual defendants are not believed to be in the United States.

“Few things are more important than ensuring the safety of what we put into our bodies,” said U.S. Attorney John Parker for the Northern District of Texas.  “Those who deliberately mislead us on this critical issue will be prosecuted to the fullest extent of our laws.”

An indictment is an accusation by a federal grand jury and is not evidence of guilt. The defendants should be presumed innocent unless and until proven guilty.

Upon conviction, the maximum statutory penalties for the individual defendants are 20 years’ imprisonment and a $250,000 fine for mail fraud or wire fraud; one year imprisonment and a $100,000 fine for the introduction of misbranded food into interstate commerce; three years’ imprisonment and a $250,000 fine for the introduction of misbranded food into interstate commerce with the intent to defraud or mislead; five years’ imprisonment and a $250,000 fine for obstruction of an agency proceeding; and 20 years’ imprisonment and a $250,000 fine for smuggling.

The FDA Office of Criminal Investigations-Dallas Division investigated the case. The case is being prosecuted by Assistant U.S. Attorneys Kathryn Rumsey and Errin Martin of the Northern District of Texas and Trial Attorneys David Sullivan and Patrick Runkle of the Justice Department’s Consumer Protection Branch.

Additional information about the Consumer Protection Branch and its enforcement efforts may be found at http://www.justice.gov/civil/consumer-protection-branch. For more information about the U.S. Attorney’s Office for the Northern District of Texas, visit its website at https://www.justice.gov/usao-ndtx.

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A Dallas anesthesiologist who allegedly injected nerve blocking agents and other drugs into patient IV bags at a local surgery center – resulting in at least one death and multiple cardiac emergencies – was arrested Wednesday on federal criminal charges, Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division, and U.S. Attorney for the Northern District of Texas Chad E. Meacham announced today. 

Raynaldo Rivera Ortiz Jr., 59, was charged via criminal complaint with tampering with a consumer product causing death and intentional drug adulteration. He was arrested in Plano on Wednesday and will make his initial appearance before U.S. Magistrate Judge Renee Toliver  in Dallas on Friday at 10 a.m.

According the criminal complaint, on June 21, a 55-year-old female coworker of Dr. Ortiz, identified in court documents as M.K., experienced a medical emergency and died immediately after treating herself for dehydration using an IV bag of saline taken from the surgical center. An autopsy report revealed that she died from a lethal dose of bupivacaine, a nerve blocking agent that is rarely abused but is often used during the administration of anesthesia.

Two months later, on Aug. 24, an 18-year-old male patient, identified in court documents as J.A., experienced a cardiac emergency during a routine sinus surgery. The teen was intubated and transferred to a local ICU. Chemical analysis of the fluid from a saline bag used during his surgery revealed the presence of bupivacaine, epinephrine (a stimulant), and lidocaine, drugs that could have caused the patient’s sudden symptoms.

According to the complaint, surgical center personnel concluded that the incidents involving M.K. and J.A. suggested a pattern of intentional adulteration of IV bags used at the surgical center. They identified 10 additional unexpected cardiac emergencies that occurred during otherwise unremarkable surgeries between May and August 2022, which the complaint alleges is an exceptionally high rate of complications over such a short period of time.

In each of those cases – which investigators believe occurred on or around May 26 and 27; June 27; July 7, 15 and 18; and Aug. 1, 4, 9 and 19 – medical personnel were able to stabilize the patient only through use of emergency measures. Most of the incidents occurred during longer surgeries that used more than one IV bag, including one or more bags retrieved mid-surgery from a stainless steel bag warmer.

The complaint alleges that none of the cardiac incidents occurred during Dr. Ortiz’s surgeries, and that they began just two days after Dr. Oritz was notified of a disciplinary inquiry stemming from an incident during which he allegedly “deviated from the standard of care” during an anesthesia procedure when a patient experienced a medical emergency. The complaint alleges that all of the incidents occurred around the time Dr. Ortiz performed services at the facility, and no incidents occurred while Dr. Ortiz was on vacation.

The complaint further alleges that Dr. Ortiz, who had a history of disciplinary actions against him, expressed concern to other physicians over the disciplinary action at the facility and complained the center was trying to “crucify” him. A nurse who worked on one of Dr. Ortiz’s surgeries allegedly told law enforcement that Dr. Ortiz refused to use an IV bag she retrieved from the warmer, physically waving the bag off.

Surveillance video from the center’s operating room hallway allegedly showed Dr. Ortiz placing IV bags into the stainless-steel bag warmer shortly before other doctors’ patients experienced cardiac emergencies. 

The complaint alleges that in one instance captured in the surveillance video, agents observed Dr. Ortiz walk quickly from an operating room to the bag warmer, place a single IV bag inside, visually scan the empty hallway, and quickly walk away. Just over an hour later, according to the complaint, a 56-year-old woman suffered a cardiac emergency during a scheduled cosmetic surgery after a bag from the warmer was used during her procedure.

The complaint alleges that in another instance, agents observed Dr. Ortiz exit his operating room carrying an IV bag concealed in what appeared to be a paper folder, swap the bag with another bag from the warmer, and walk away. Roughly half an hour later, a 54-year-old woman suffered a cardiac emergency during a scheduled cosmetic surgery after a bag from the warmer was used during her procedure. 

“The safety of the nation’s pharmaceutical supply is critically important,” said Principal Deputy Assistant Attorney General Brian M. Boynton. “The Department will vigorously prosecute this case consistent with the evidence gathered by our law enforcement partners.”

“Our complaint alleges this defendant surreptitiously injected heart-stopping drugs into patient IV bags, decimating the Hippocratic oath,” said U.S. Attorney Chad E. Meacham. “A single incident of seemingly intentional patient harm would be disconcerting; multiple incidents are truly disturbing. At this point, however, we believe that the problem is limited to one individual, who is currently behind bars. The Department of Justice and our indefatigable partners at the FDA’s Office of Criminal Investigations and the Dallas Police Department will work tirelessly to hold him accountable. In the meantime, it is safe to undergo anesthesia in Dallas.”

“Patients expect that their doctors will use only safe and effective medical products during their surgeries. When illicit tampering occurs, serious harm and even death can result,” said Special Agent in Charge Charles L. Grinstead, FDA Office of Criminal Investigations. “Working with our law enforcement partners, we will continue to monitor, investigate and bring to justice those who would risk patients’ health and safety.”

A criminal complaint is merely an allegation of criminal conduct, not evidence. Dr. Ortiz is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

If convicted, he faces a maximum penalty of life in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

The U.S. Food & Drug Administration’s Office of Criminal Investigations and the Dallas Police Department conducted the investigation with the assistance of scientists from the University of North Texas. Senior Litigation Counsel Patrick Runkle and Senior Trial Counsel Yolanda McCray Jones of the Justice Department’s Consumer Protection Branch and Assistant U.S. Attorneys John de la Garza and Errin Martin of the Northern District of Texas are prosecuting the case.

A Dallas man who conned 417 investors out of nearly $15 million was sentenced to 17 ½ years in federal prison, announced U.S. Attorney for the Northern District of Texas Chad E. Meacham.

Rudy Avila, 69, pleaded guilty to wire fraud in June 2021. He was sentenced on Jan. 28 by Chief U.S. District Judge Barbara M.G. Lynn, who also ordered him to pay $14,955,313.00 in restitution.

According to plea papers, Mr. Avila admitted he defrauded investors in seven investment companies: Starwood Asset Management Fund, Commodities Investment Group International, Trading Technologies Group, Trading Ventures Group, The L.I.F.T. Group, Capital Ventures Group, and Ventures Group, LLC, none of which were registered with the United States Securities and Exchange Commission or the Commodities Futures Trading Commission as required by law.

Instead of investing money in U.S. based businesses as he had represented, Mr. Avila regularly wired at least 90% of the investors’ funds to bank accounts belonging to coconspirators in Costa Rica or to make  Ponzi payments to other investors.

In order to convince investors that their funds were controlled by U.S. businesses, the defendant registered multiple businesses with the Texas Secretary of State, filed sham annual reports from the businesses, set up U.S. bank accounts for the businesses, and rented office space in DFW.  

At Mr. Avila’s sentencing hearing, Judge Lynn read the names of all 417 victims and their loss amounts into the record.

Two of his coconspirators, Eddie Alexander Contreraz and Ivan Aguirre, who both pleaded guilty to conspiracy to commit wire fraud last year, are still awaiting sentencing.

The Federal Bureau of Investigation’s Dallas Field Office conducted the investigation. Assistant U.S. Attorneys Marcus Busch and Nick Bunch (fmr.) are prosecuting the case.

A San Angelo man who embezzled more than half a million dollars from a wind farm was sentenced yesterday to more than three years in federal prison, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.

Arturo Salazar III, 41, a former site manager for a Vestas-American Wind Technologies wind farm, pleaded guilty to four counts of unauthorized transactions with access devices in May. He was sentenced Thursday to 37 months in federal prison by U.S. District Judge James Wesley Hendrix, who ordered him to pay $359,810 in restitution to the company.

According to court documents, Mr. Salazar admitted that he teamed up with a conspirator to create a sham business, BT Machine, with the sole purpose of creating fraudulent invoices. 

From 2016 to 2019, the pair created hundreds of bogus invoices for nonexistent equipment BT Machine purportedly leased to Vestas. The conpsirator sent each invoice – complete with a BT “logo” – to Mr. Salazar at his work email address; Mr. Salazar then paid each one with his Vetas credit card. He and the other individual then split the money.

Mr. Salazar also used Vestas company credit cards to make unauthorized purchases totaling approximately $80,000.  These personal purchases included products from Amazon as well as a $50,000 skid steer loader, a $18,900 universal terrain vehicle, and a $7,900 dump trailer.

From 2016 to 2019, Mr. Salazar admitted to defrauding Vestas out of more than $550,000. To avoid detection, he kept each transaction under the $2,000 limit set by his employer.

The Federal Bureau of Investigation’s Dallas Field Office, San Angelo Resident Agency conducted the investigation.  Assistant U.S. Attorney Ann Howey prosecuted the case.

 

A federal jury on Friday returned a guilty verdict against a so-called “pill mill” physician who oversaw the illegal prescription of nearly a million units of narcotics with no legitimate medical purpose, announced U.S. Attorney for the Northern District of Texas Erin Nealy Cox.    

Carlos Luis Venegas was convicted of conspiracy to distribute a controlled substance before U.S. District Judge David C. Godbey in Dallas yesterday afternoon.

“These pill mills help to perpetuate the tragic opioid crisis gripping our country,” said U.S. Attorney Nealy Cox. “Last year, America lost, on average, 116 people per day to opioid overdoses. We cannot allow unscrupulous conduct by physicians to add to the supply of dangerous drugs on the streets.” (For additional facts and figures on the opioid epidemic, see the DEA's 2018 National Drug Threat Assessment.)

According to evidence presented at trial, Mr. Venegas acted as the supervising physician for a series of sham medical clinics – all merely fronts for the illegal distribution of hydrocodone and alprazolam.  

Members of the conspiracy, witnesses testified, paid homeless and indigent people to pose as patients seeking pain medication. Runners coached these men and women on how to describe their (nonexistent) symptoms, drove them to the clinics, and paid for their appointments. 

At the clinics, nurse practitioners, working under Mr. Venegas’ supervision, conducted only cursory medical exams, witnesses said. Medical files seize from the clinics showed that most exams were conducted without any medical testing and rarely produced documentation of patients’ purported ailments. 

At the conclusion of the visit, patients were almost always prescribed a cocktail of medications, including Hydrocodone and Xanax, generally for the highest dosages available. 

Mr. Venegas now faces up to 20 years in federal prison. Sentencing has not yet been set.

Several of his codefendants, including several nurse practitioners and clinic managers, previously pleaded guilty to their roles in the scheme.  

The Drug Enforcement Administration conducted the investigation. Assistant U.S. Attorneys Myria Boehm, Renee Hunter, and Nicholas Bunch prosecuted the case.

 

Shortly after a jury was seated in his case, a Kennedale, Texas tax preparer pleaded guilty to a $2.6 million tax fraud, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.

Anthony “Tony” Floyd, 51, was charged in June 2023 with ten counts of aiding in the preparation and presentation of false tax returns. On the morning of his trial, shortly after a jury was seated, Mr. Floyd pleaded guilty to all 10 charges.

According to court documents, Mr. Floyd filed approximately 400 fraudulent tax returns that included false information designed to increase the amount of refund owed to the taxpayer.

He recruited victim “clients” outside big box stores and through other clients. He obtained their personal information, such as income and deduction information, via text or cell phone conversations, rarely meeting clients in person. Mr. Floyd purposely submitted the returns without reviewing with the taxpayer, then diverted all or most of the refund to his own account.

The resultant tax loss to the United States exceeded $2.6 million.

The tax filings included falsified W2s – filed on behalf of individuals purportedly working in catering, lawn care, event planning, interior décor, and other professions -- and included nonexistent charitable deductions, nonexistent college attendance, and even fictitious relatives.

“Mr. Floyd’s guilty plea shows that tax fraud is not a victimless crime,” said Christopher J. Altemus Jr., Special Agent in Charge of the IRS Criminal Investigation’s Dallas Field Office. “Mr. Floyd took advantage of his neighbors by preparing fraudulent tax returns and trying to steal over $2 million from the U.S. government. Mr. Floyd’s case should remind all tax practitioners to adhere to professional standards and follow the law.”

 “Everyone must ensure what is submitted is true and accurate when filing their taxes, even if they are prepared by a professional,” Altemus added.

Mr. Floyd now faces up to three years per count, for a total of 30 years in federal prison.

IRS – Criminal Investigations conducted the investigation. Assistant U.S. Attorneys P.J. Meitl, Nancy Larson, and Mark Nicols (fmr) prosecuted the case.

The inventor of cryptocurrency AriseCoin was sentenced today to five years in federal prison for duping investors out of more than $4 million, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah. 

AriseBank CEO Jared Rice, Sr. – who settled a civil action involving AriseCoin filed by the SEC’s Fort Worth regional office last year – pleaded guilty to one count of securities fraud in March 2019. He was sentenced Wednesday by U.S. District Judge Ed Kinkeade, who ordered him to pay $4,258,073 in restitution.

According to his plea papers, Mr. Rice, 33, admitted he lied to would-be investors, claiming that AriseBank – billed as the world’s “first decentralized banking platform” based on the proprietary digital currency AriseCoin – could offer consumers FDIC-insured accounts and traditional banking services, including Visa-brand credit cards, in addition to cryptocurrency services.  In actuality, AriseBank had not been authorized to conduct banking in Texas, was not FDIC insured, and did not have any sort of partnership with Visa.

Even as he touted AriseBank’s nonexistent benefits, Mr. Rice quietly converted investor funds for his own personal use, spending the money on hotels, food, transportation, a family law attorney, and even a guardian ad litem – facts he failed to disclose to investors. He also failed to disclose that he’d plead guilty to state felony charges in connection with a prior internet-related business scheme. 

Meanwhile, hundreds of investors bought approximately $4,250,000 in AriseCoin using digital currencies like Bitcoin, Ethereum, and Litecoin, as well as fiat currency.

The Federal Bureau of Investigation’s Dallas Field Office conducted the investigation. Assistant U.S. Attorneys Mary Walters, Sid Mody, and Erica Hilliard prosecuted the case.

An MS-13 gang member was sentenced this week to more than 17 years in federal prison for his role in several brutal machete attacks at apartment complexes in Dallas, announced  U.S. Attorney for the Northern District of Texas Erin Nealy Cox and Acting Assistant Attorney General Brian C. Rabbitt of the Justice Department’s Criminal Division.

Arnold Stephen Miralda-Cruz, 23, pleaded guilty in February to RICO conspiracy, and was sentenced Tuesday afternoon to 210 months in federal prison, an upward departure by U.S. District Judge Jane J. Boyle. Mr. Miralda-Cruz is the last of seven defendants sentenced in the case.

“MS-13 is one of the most vicious gangs operating in America today,” said U.S. Attorney Erin Nealy Cox. “When machete-wielding gang members terrorize our streets, they will be met with certain justice. The Northern District of Texas thanks our law enforcement partners, led by Homeland Security Investigations, who worked tirelessly to take seven brutal men out of our community.”

“With this sentencing, seven MS-13 gang members responsible for multiple brutal attacks in the Dallas area have now been brought to justice,” said Acting Assistant Attorney General Brian C. Rabbitt.  “The Department of Justice will not waver in its commitment to dismantle and destroy the scourge of MS-13.”

“This sentencing brings an end to the violence posed by these criminal gang members who have inflicted mayhem in our communities without any remorse or empathy for anyone,” said Christopher M. Miller, deputy agent in charge Homeland Security Investigations Dallas. “The violent crimes this thug and his cohorts committed for the sake of street credibility and their gang’s reputation has ended with this illegal perpetrator behind bars.”

According to court documents, the defendants – all El Salvadorian and Honduran nationals in the United States illegally – admitted they belonged to MS-13, a notoriously violent transnational street gang with the creed, “kill, rob, rape, control.”  As members, the defendants were required to commit acts of violence to protect the gang’s reputation, and were urged to attack and kill rivals whenever possible.

To that end, on July 14, 2017, Mr. Miralda-Cruz and several other gang members, including codefendants Rolan Ivan Hernandez Fuentes and Jerson Gutierrez-Ramos, ambushed a rival gang member and his roommate inside an apartment complex in Dallas. Armed with machetes, knives, box cutters, and a metal bar, they struck, stabbed, and cut the victims with intent to kill. The attack left one man with his chest and neck sliced open, necessitating emergency cardiac surgery, and the other with lacerations to his face, requiring hospitalization. Following the attack, Mr. Hernandez-Fuentes licked the victims’ blood from the machete and stated that he liked the “taste of victory.” 

The following day, on July 15, 2017, Mr. Miralda-Cruz, Mr. Hernandez-Fuentes, and Mr. Gutierrez-Ramos attacked and extorted a third man outside his home in Irving. Armed with the a machete from the night before, Mr. Hernandez-Fuentes forced the victim to kneel, then kicked him and stuck him with the machete. The group demanded the victim, a heroin dealer, pay their MS-13 clique an extortion fee, a “tax,” to deal drugs in their territory.

On August 9, 2017, several gang members attacked another rival gang member at an apartment complex in Dallas, intending to kill the victim.  Armed with a sledgehammer, an icepick, a metal bar, a stick, and a knife, they chased the victim, caught him when he tripped, and then attacked him. The victim, who managed to escape, suffered stab wounds to his back and lacerations on several parts of his body, requiring hospitalization.  

On August 19, 2017 several gang members attacked and robbed another rival gang member at an apartment complex in Irving.  Hernandez-Fuentes approached the victim near a gas station and lured him to a nearby apartment complex where his fellow gang members were waiting.  After robbing the victim, they savagely beat, kicked, and hit him with a metal bat until they thought that he was dead.  The victim suffered a fractured skull and bleeding from his brain, requiring hospitalization. 

In late August, several gang members plotted twice to kill a man believed to be a member of a rival gang.  They first lured the victim to a park in Dallas, where they lay in wait with machetes and a shotgun.  The victim ultimately refused to get out of his car, and they aborted the plan to kill him.  A few days later, they renewed the plot.  At an apartment complex in Dallas, they confronted the victim with a shotgun.  Mr. Gutierrez-Ramos pointed the shotgun at the victim’s chest to shoot him, but the weapon jammed and did not fire.  The victim managed to drive away.

On September 25, 2017,  Mr. Hernandez-Fuentes, Mr. Gutierrez-Ramos, and other MS-13 gang members went to Running Bear Park in Irving to ambush and kill a victim whom they believed to be a rival gang member.  Armed with machetes, sticks, and a shotgun, they lured the victim to the park under the guise that they were going to buy a tattoo machine from him.  The victim, however, unexpectedly arrived at the park with three friends.  Nonetheless, the victims were lured to the back of the park where the armed gang was hiding in the woods and waiting to spring.  When the victims arrived near the wooded area, the armed gang confronted them and forced them to kneel.

A brutal attack ensued as the assailants hacked at the four victims with their machetes.  One male victim escaped unscathed.  During the attack, Hernandez-Fuentes hit one male victim with the shotgun and told him not to “mess with the mara (gang).”  At some point, Hernandez-Fuentes got distracted, and the victim ran away.  Hernandez-Fuentes fired at the victim but missed, and the victim escaped by swimming across a pond.  Another male victim also escaped after he sustained a serious cut to his arm, which required hospitalization.  The female victim, however, was not so fortunate.  She was savagely maimed, sustaining multiple deep lacerations to her arms, hands, and leg from the machete attack.  The female victim, who was left for dead badly bleeding in the park, sustained permanent and life-threatening injuries, which required extensive medical care and hospitalization.  After the attack, the attackers drove away with their weapons and property stolen from the victims.  The police arrested the attackers in the days following the savage assault.

Other sentences in the case are as follows:

Rolan Ivan Hernandez-Fuentes, aka “Tasmania,” sentenced to life in federal prison for RICO conspiracy  

Jerson Gutierrez-Ramos, aka “Sparky,” sentenced to 475 months in federal prison for RICO conspiracy

Arnold Steven Miralda-Cruz, aka “Sico,” sentenced to 210 months in federal prison for RICO conspiracy

Kevin Cruz, aka “Street Danger,” sentenced to 250 months in federal prison for RICO conspiracy

Manuel Amaya-Alvarez, aka “Chocolate,” sentenced to 240 months for two counts of attempted murder in aid of racketeering

Jose Armando Saravia-Romero, aka “Pinky,” sentenced to 57 months in federal prison for assault with a dangerous weapon in aid of racketeering

Jonathan Alexander Baires, aka “Splinter,” sentenced to 120 months for attempted murder in aid of racketeering

 

The defendants, who were in the United States illegally at the time of the crimes, may be subject to deportation after serving their sentences.

Homeland Security Investigations, the Irving Police Department, and the Dallas Police Department conducted the investigation.  Assistant U.S. Attorneys Gary Tromblay and Sid Moody  are prosecuting the case with Trial Attorney Julie Finocchiaro of the Department of Justice's Organized Crime and Gang Section.

           DALLAS — Dallas City Council Member and Mayor Pro Tem Dwaine Caraway, of Dallas, Texas, and Robert C. Leonard Jr., of New Orleans, Louisiana, appeared in federal court today before Chief U.S. District Judge Barbara M.G. Lynn and pleaded guilty to federal conspiracy charges, announced Erin Nealy Cox, U.S. Attorney of the Northern District of Texas.  Council Member Caraway pleaded guilty to one count of conspiracy to commit honest services wire fraud and one count of tax evasion.  Robert Leonard pleaded guilty to one count of conspiracy to commit honest services wire fraud. 

            The law enforcement operation was led by the Federal Bureau of Investigation (FBI) and the Internal Revenue Service Criminal Investigation (IRS-CI). 

          “The pleas today represent the meticulous and tireless efforts of the Federal Bureau of Investigation, the Internal Revenue Service, and the dedicated prosecutors of our office,” stated U.S. Attorney Nealy Cox. “These cases demonstrate our continued resolve to uncover corruption at the highest levels--the citizens of Dallas deserve honest government.” 

          “Today's guilty pleas are the results of a sensitive and complex investigation conducted by FBI Dallas' Public Corruption Investigative Team with assistance from the Internal Revenue Service.  The conspirators utilized their position of access and financial means to defraud the citizens of Dallas County,” said Eric K. Jackson, Special Agent-in-Charge of the Dallas Division.  “The FBI will continue to aggressively investigate any public servant who abuses their official position and access to benefit themselves financially at the taxpayer’s expense.  Additionally, those who seek to exploit public servants with financial or material support will be identified and held accountable for their actions.” 

          “IRS Criminal Investigation uses financial investigative expertise to pursue those individuals who engage in corruption and tax fraud,” said Tamera Cantu, IRS Special Agent in Charge of the Dallas Field Office.  “Merging the unique skills of each agency makes a formidable team as we investigate those who violate the public’s trust.  Today’s actions underscore that the law applies to everyone, regardless of position or power.”

          According to the Plea Agreements and Factual Resumes filed in the cases, Leonard paid and Caraway accepted more than $450,000 in bribe and kickback payments in the form of a phony consulting agreement, luxury suits, fully funded trips, gambling money, repayment of personal debt, checks and cash.  Leonard also admitted to paying Rick Sorrells, former Dallas County Schools Superintendent, over $3 million in bribes and kickbacks payments in various forms, including $200,000 toward Sorrells’ credit card and student loan debt through a bank account opened in the name of a nonexistent entity. 

         In return for the bribe and kickback payments, Caraway promised favorable official actions to further Leonard’s business interests in Dallas.  These actions included key votes to promote and continue the school bus stop-arm camera program -- which contracted with Leonard’s company, Force Multiplier Solutions -- and other actions taken to benefit Force Multiplier Solutions. 

        Both Defendants admitted to efforts undertaken to disguise and conceal the nature of the bribe and kickback payments.  Leonard funneled a significant portion of the illicit payments through various pass-through companies created and operated by his business associate, Slater Washburn Swartwood, Sr., of Louisiana.  Specifically, Swartwood, acting at Leonard’s direction, funneled and masked payments to Caraway and Sorrells as “consulting fees” or “loans” through his shell company ELF Investments.  The co-conspirators originally characterized the payments to Sorrells as “consulting,” but later attempted to recast the payments as a loan.  Sorrells provided no legitimate consulting services in exchange for the payments.  There were payments made to Caraway in the form of checks that were cashed at pawnshops and liquor stores. 

        Caraway also admitted that in 2012 through 2014, he evaded and defeated the payment of substantial income tax due and owed to the IRS resulting in a tax loss of $68,906.  Specifically, in 2014, Caraway failed to report for income tax purposes $97,000 of bribe and kickback payments he received from Leonard, under the auspice of “consulting fees.”  Caraway also offset a portion of bribe and kickback payments he did report as income in prior years via phony business expenses. 

        The other co-conspirators, Swartwood and Sorrells, pleaded guilty earlier in the year.  Swartwood pleaded guilty in February 2018 and Sorrells in April 2018 for their joint role in the conspiracy.  Both are currently out on bond.  Swartwood’s sentencing is scheduled for August,  and Sorrells’ sentencing before U.S. District Judge David C. Godbey has not yet been scheduled.

        U.S. Attorney Nealy Cox praised the efforts of the FBI, IRS-CI and the Department of Justice Tax Division.  Assistant U.S. Attorneys Andrew Wirmani, Chad Meacham, Joe Magliolo, and Economic Crime & Public Corruption Section Chief Marcus Busch are prosecuting the case. 

 

###

 

 Dallas’ Project Safe Neighborhoods Taskforce earned one of just two “Outstanding Overall Partnership” awards from the U.S. Department of Justice, U.S. Attorney for the Northern District of Texas Erin Nealy Cox announced today.

Dubbed “Operation Badge #10934” in honor of fallen Dallas Police Officer Rogelio Santander, Dallas PSN was launched in February 2018 to tackle increasing violent crime. Led by U.S. Attorney Nealy Cox and Dallas Police Chief Renee Hall, the PSN Taskforce –  a coalition of federal and local law enforcement that includes FBI, ATF, DEA, and the U.S. Marshals Service – has already made more than 120 arrests inside the PSN “hotspot,” a historically crime-riddled community nestled at the intersection of Route 75 and LBJ.

Over the past eight months, the hotspot has seen a 19.9% reduction in violent crime.

“Our PSN Taskforce in Dallas is Texas-sized,” Acting Attorney General Matt Whitaker said at an awards ceremony in Kansas City, MO Thursday. “It brings together 60 people, including law enforcement officers, local government officials, local school personnel, and 15 community organizations.”

“I’m incredibly proud of the way we’ve been able to marshal resources from federal and local law enforcement to foster lasting change in a neighborhood that sorely needs our help,” said Nealy Cox. “None of this would have been possible without our law enforcement team, which includes DPD Chief Hall, FBI SAC Eric Jackson, DEA SAC Clyde Shelley, ATF SAC Jeffrey Boshek, U.S. Marshal Rick Taylor, and many others.”

“I am extremely proud of the partnership between the Dallas Police Department and U.S. Attorney’s Office with Project Safe Neighborhood,” Chief Hall said in a statement. “The work of the Dallas Project Safe Neighborhood team is making a difference and being recognized by the Department of Justice.  This enforcement effort is beneficial and allows us to focus on concentrated crime areas, while engaging with the community.”   

Dallas’ PSN initiative relies on a three-pronged approach combining traditional enforcement, community outreach, and recidivism reduction.  Federal prosecutors have charged dozens of individuals with felony crimes, from carjacking to straw purchasing. They’ve also held nearly 50 community events to explain how residents can help keep communities safe, and hosted nearly 2,500 ex-convicts and parolees at monthly “reentry nights” outlining ramifications of re-offending and presenting a buffet of resources, from job placement programs to counseling opportunities.

The Dallas PSN Taskforce is joined in the overall partnership category by Jackson, Mississippi’s PSN team. Ten other districts were honored for individual and organizational contributions to Project Safe Neighborhoods. The Northern District of Texas’ PSN operation is managed by Coordinator P.J. Meitl. More information on Dallas PSN here.











 

Three firearm vendors who operated at DFW gun shows have pleaded guilty to unlicensed dealing, announced U.S. Attorney for the Northern District of Texas Erin Nealy Cox. None of the defendants were conducting background checks on their buyers.

Raleigh Merriam Selby III, 56, Jack Don Sims, 57, and James Cary Bennett, 79, each pleaded guilty to engaging in the business of dealing in firearms without a license before Magistrate Judge Irma C. Ramirez Thursday morning.

“Today, we’re taking aim at unlicensed dealers who allow guns to fall into dangerous hands,” said U.S. Attorney Erin Nealy Cox. “I’m proud to bring this case under Project Guardian, the Attorney General’s gun violence reduction initiative. Hopefully, these pleas send a message to would-be offenders: If you violate federal firearms laws, you will be held accountable for the guns you’ve illegally injected into our communities.”

“Engaging in the business of selling firearms without a license circumvents regulations designed to identify prohibitors such as felony offenses, dishonorable discharge from military service or substance abuse," stated ATF Special Agent in Charge Jeffrey C. Boshek II.  “The firearms transfers made by Mr. Bennett, Mr. Selby and Mr. Sims undermine community safety and hinder the investigation of firearms recovered at crime scenes.”

Federal law requires that dealers engaged in the business of dealing firearms – defined as repeatedly devoting time and attention to purchasing and reselling guns for monetary gain – obtain Federal Firearms Licenses and run background checks on potential buyers.  (Hobbyists who sell weapons in one-off private transactions are not required to be licensed or to run background checks.)

According to plea papers, Mr. Bennett, Mr. Selby, and Mr. Sims were caught engaging in the business of selling firearms without a license during an undercover investigation at several Dallas-area gun shows, including Big Town in Mesquite, Will Rogers Coliseum in Fort Worth, and Market Hall in Dallas.

None of them entered potential buyers into the National Instant Criminal Background Check System, NICS.

The defendants admit that many of the guns they sold ended up in the hands of prohibited persons, including a man convicted of drug dealing and another convicted of willful cruelty to a child. Others were recovered at crime scenes, from California to Florida to Mexico.

Both Mr. Bennett and Mr. Sims admit they explicitly promoted that sales at their booths involved “no paperwork” – in other words, no background check. Mr. Bennett even admits that he dealt in .380 caliber pistols, “preferred firearms for trafficking to Mexico.”

Each defendant now faces up to five years in federal prison.

The Bureau of Alcohol, Tobacco, Firearms, & Explosives conducted the investigation. Assistant U.S. Attorneys Brian McKay and Damien Diggs are prosecuting the cases, brought under Project Guardian, the Justice Department's signature initiative to reduce gun violence and enforce federal firearms laws.

A “pill mill” physician who oversaw the illegal prescription of nearly a million units of narcotics with no legitimate medical purpose was sentenced today to 13 years in federal prison, announced U.S. Attorney for the Northern District of Texas Erin Nealy Cox.   

Carlos Luis Venegas, 62, was convicted of conspiracy to distribute a controlled substance following a 5-day trial before U.S. District Judge David C. Godbey in early February.

According to evidence presented at trial, Dr. Venegas acted as the supervising physician for a series of sham medical clinics – all merely fronts for the illegal distribution of Hydrocodone and Alprazolam. 

“These pill mills help to perpetuate the tragic opioid crisis gripping our country,” U.S. Attorney Nealy Cox said following the guilty verdict. “Last year, America lost, on average, 116 people per day to opioid overdoses. We cannot allow unscrupulous conduct by physicians to add to the supply of dangerous drugs on the streets.”

“The DEA will continue to investigate these types clinics and health care personnel who are facilitating illegal distribution of prescription drugs”, said DEA Special Agent in Charge of the Dallas Field Division Clyde E. Shelley, Jr. “One overdose is one too many”.

At trial, witnesses testified that members of the conspiracy paid homeless and indigent people to pose as patients seeking pain medication. Runners coached these men and women on how to describe their (nonexistent) symptoms, drove them to the clinics, and paid for their appointments.

At the clinics, nurse practitioners and physician’s assistants, working under Dr. Venegas’ supervision, conducted only cursory medical exams, witnesses said. Medical files seized from the clinics showed that most exams were conducted without any medical testing and rarely produced documentation of patients’ purported ailments.

At the conclusion of the visit, patients were almost always prescribed a cocktail of medications, including Hydrocodone and Xanax, generally for the highest dosages available.

Several of his codefendants, including several nurse practitioners and clinic managers, previously pleaded guilty to their roles in the scheme.  

Codefendant sentences include:

Christan Michael Hicks – 70 months

Craig Zahn – 33 months

Leslie Rodriguez – 33 months

Don Broussard – 33 months

Ron Cunningham – 18 months

James Christopher Ware (co-owner of clinics, charged in a separate indictment) – 135 months

Stanley James (co-owner of clinics, also charged in a separate indictment) – 97 months

For more information on the opioid epidemic, see the DEA's National Drug Threat Assessment.

The Drug Enforcement Administration conducted the investigation. Assistant U.S. Attorneys Myria Boehm, Renee Hunter, and Nicholas Bunch prosecuted the case.

DALLAS — A 60-year-old doctor from Rockwall, Texas, Jacques Roy, who was convicted in April 2016 of various health care fraud charges following a six-week-long trial, was sentenced today by U.S. District Judge Sam A. Lindsay to 420 months in federal prison and ordered to pay $268,147,699.15 in restitution, joint and several with all codefendants to Medicare and Medicaid, announced U.S. Attorney John Parker of the Northern District of Texas.

Roy was convicted of one count of conspiracy to commit health care fraud, eight counts of health care fraud, two counts of making a false statement relating to healthcare matters and one count of obstruction of justice. Roy has been in custody since the time of his arrest in February 2012.

“The only thing more stunning than Jacques Roy and his co-conspirators’ shameless methods, said U.S. Attorney Parker, is the staggering dollar amounts involved in this fraud scheme. This takes brazen to a whole new level.”

The following defendants have also been sentence for their role in the health care fraud scheme:

 

     Wilbert James Vesey, Jr., 210 months in federal prison and $23 million in restitution

     Cyprian Akamnonu, 120 months in federal prison and $25 million in restitution

     Patricia Akamnonu, 120 months in federal prison and $25 million in restitution

     Charity Eleda, 48 months in federal prison and $397,294.51 in restitution

     Teri Sivils, 3 years probation and $885,714.05 in restitution

 

Cynthia Stiger will be sentenced October 26, 2017.

 

The government presented evidence at trial that Dr. Roy, Stiger, Veasey and Eleda engaged in a large-scale, sophisticated health care fraud scheme in which they conspired together and with others to defraud Medicare and Medicaid through companies they owned/controlled: Medistat Group Associates, P.A., Apple of Your Eye Health Care Services, Inc., Ultimate Care Home Health Services and Charry Home Care Services.

 

As part of the conspiracy, Stiger, Veasey and Eleda, along with others, improperly recruited individuals with Medicare coverage to sign up for Medicare home health care services. Eleda recruited patients from The Bridge homeless shelter in Dallas, sometimes paying recruiters $50 per beneficiary they found and directed to her vehicle parked outside the shelter’s gates. Eleda and other nurses would falsify medical documents to make it appear as though those beneficiaries qualified for home health care services that were not medically necessary. Eleda and the nurses prepared Plans of Care (POC), also known as 485’s, which were not medically necessary, and these POCs were delivered to Dr. Roy’s office and not properly reviewed by any physician.

 

Dr. Roy instructed his staff to certify these POCs, which indicated to Medicare and Medicaid that a doctor, typically Dr. Roy, had reviewed the treatment plan and deemed it medically necessary. That certifying doctor, typically Dr. Roy, certified that the patient required home health services, which were only permitted to be provided to those individuals who were homebound and required, among other things, skilled nursing. This process was repeated for thousands of POCs, and, in fact, Medistat’s office included a “485 Department,” essentially a “boiler room” to affix fraudulent signatures and certifications.

 

Once an individual was certified for home health care services, Eleda, nurses who worked for Stiger and Veasey, and other nurses falsified visit notes to make it appear as though skilled nursing services were being provided and continued to be necessary. Dr. Roy would also visit the patients, perform unnecessary home visits, and then order unnecessary medical services for the recruited beneficiaries. Then, at Dr. Roy’s instruction, Medistat employees would submit fraudulent claims to Medicare for the certification and recertification of unnecessary home health care services and other unnecessary medical services.

 

The government presented further evidence at trial that the scope of Dr. Roy’s fraud was massive; Medistat processed and approved POCs for 11,000 unique Medicare beneficiaries from more than 500 different home health agencies. Dr. Roy entered into formal and informal fraudulent arrangements with Apple, Charry, Ultimate and other home health agencies to ensure his fraudulent business model worked and that he maintained a steady stream of Medicare beneficiaries.

 

Regarding Dr. Roy’s conviction for obstruction of justice, the government presented evidence that when the Centers for Medicare and Medicaid Services (CMS) suspended Dr. Roy and Medistat from receiving Medicare payments after June 2, 2011, because of suspected fraud, Dr. Roy sought an “end-run” around the suspension through the use of another company, Medcare House Calls. Dr. Roy directed the medical providers he employed to be re-credentialed and to bill Medicare under Medcare House Calls, instead of Medistat. Nonetheless, the money that Medicare paid was circumvented back to Medistat and Dr. Roy.

 

The case was investigated by the Federal Bureau of Investigation, the U.S. Department of Health and Human Services (HHS) Office of Inspector General (OIG), and the Texas Attorney General’s Medicaid Fraud Control Unit (MFCU) and was brought as part of the Medicare Fraud Strike Force supervised by the Criminal Division Fraud Section and the U.S. Attorney’s Office for the Northern District of Texas.

 

Assistant U.S. Attorneys P.J. Meitl and Nicole Dana and First Assistant U.S. Attorney Chad Meacham prosecuted the case.

 

 

# # #

A Texas tax preparer who pleaded guilty to a $2.6 million tax fraud was sentenced to more than six years in federal prison, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.

Anthony “Tony” Floyd, 51, was charged in June 2023 with ten counts of aiding in the preparation and presentation of false tax returns. On the morning of his trial, shortly after a jury was seated, Mr. Floyd pleaded guilty to all 10 charges. He was sentenced Monday to 77 months in federal prison by U.S. District Judge Mark Pittman, who also ordered him to pay more than $1.9 million in restitution.  

According to court documents, Mr. Floyd filed approximately 400 fraudulent tax returns that included false information designed to increase the amount of refund owed to the taxpayer.

He recruited victim “clients” outside big box stores and through other clients. He obtained their personal information, such as income and deduction information, via text or cell phone conversations, rarely meeting clients in person. Mr. Floyd purposely submitted the returns without reviewing with the taxpayer, then diverted all or most of the refund to his own account.

The resultant tax loss to the United States exceeded $2.6 million.

The tax filings included falsified W2s – filed on behalf of individuals purportedly working in catering, lawn care, event planning, interior décor, and other professions -- and included nonexistent charitable deductions, nonexistent college attendance, and even fictitious relatives.

“Mr. Floyd’s sentencing sends a message that tax fraud is not a victimless crime,” said Christopher J. Altemus Jr., Special Agent in Charge of the IRS Criminal Investigation’s Dallas Field Office. “Mr. Floyd took advantage of his neighbors by preparing fraudulent tax returns and trying to steal approximately $2 million from the U.S. government. His sentence of 77 months in prison holds him accountable for his crimes.”

“Everyone must ensure what is submitted is true and accurate when filing their taxes, even if they are prepared by a professional,” Mr. Altemus added.

IRS – Criminal Investigations conducted the investigation. Assistant U.S. Attorneys P.J. Meitl, Nancy Larson, and Mark Nicols (fmr) prosecuted the case.

Fort Worth, Texas-based commercial roofing contractor Empire Roofing, Inc. and its nationwide network of roofing and disposal companies agreed to pay $9 million to resolve allegations that they violated the False Claims Act (FCA) by falsely certifying that eight of their affiliates were eligible to receive loans through the Small Business Administration’s (SBA) Paycheck Protection Program (PPP), announced U.S. Attorney for the Northern District of Texas Leigha Simonton. 

Congress created the PPP in March 2020, as part of the Coronavirus Aid, Relief and Economic Security (CARES) Act to provide emergency loans to small businesses suffering economic hardship due to the COVID-19 pandemic.  Whether an applicant qualified for a PPP loan as a small business depended on various factors, including the number of employees of both the applicant and corporate affiliates.  Subject to limited exceptions, only businesses that employed 500 or fewer employees were eligible to receive a PPP loan.  When applying for PPP loans and loan forgiveness, borrowers were required to certify the truthfulness and accuracy of all information provided in their loan applications.

Empire Roofing, Inc., along with affiliated businesses within its nationwide network, applied for and received a total of $6,705,700 in PPP loans.  The loans were all later forgiven in full.  Each applicant certified that they were a small business with fewer than 500 employees.  Under applicable SBA rules, however, applicants were required to include employees of all affiliated companies when determining eligibility.  The government contends that the Empire Roofing network of affiliated companies employed more than 500 employees and therefore that none of Empire Roofing’s affiliates were eligible to receive PPP loans or loan forgiveness under the CARES Act.

“PPP loans were intended to help small businesses during the Covid-19 pandemic,” said United States Attorney Leigha Simonton.  “Our office invests significant time and resources to hold accountable those who obtained PPP funds for which they were not eligible and will continue to do so going forward.”

“The settlement in this matter demonstrates the excellent results achieved through the combined efforts of SBA and the Department of Justice to uncover and forcefully respond to PPP misconduct,” said SBA General Counsel Therese Meers.  “The federal government is strongly committed to identifying and aggressively pursuing any instances of fraud or misconduct within the Paycheck Protection Program.”

The settlement resolved a lawsuit filed under the qui tam or whistleblower provision of the FCA, which permits private parties to file suit on behalf of the United States for false claims and share in a portion of the government’s recovery.  The qui tam lawsuit is captioned United States ex rel. Sidesolve v. Empire Roofing, Inc., et al., No. No. 3:22-CV-2060-B (N.D. Tex.).  The relator, Sidesolve, Inc., will receive a $1 million share as part of the settlement.  

This matter was handled by Assistant United States Attorneys William Admussen and Andrew Robbins, with assistance from Sandra Mazzoni of the SBA.  The civil claims settled by this FCA agreement are allegations only; there has been no determination of civil liability. 











 

The U.S. Attorney’s Office for the Northern District of Texas is on alert for fraudsters seeking to profit off of the extreme weather in Texas, warned Acting U.S. Attorney Prerak Shah.

Burst pipes, flooding, and other property damage stemming from this week’s storm may prompt unscrupulous actors to reach out to consumers with bogus insurance or home warranty information or nonexistent government grants, the U.S. Attorney’s Office said.

“Time and time again, we’ve seen scammers exploit natural disasters for personal gain,” said Acting U.S. Attorney Shah. “The last thing beleaguered Texans need right now is to fall prey to fraud. If something sounds too good to be true, it probably is. We urge consumers to exercise caution, especially when it comes to unsolicited calls, texts, or emails.”

Millions of people fall victims to scams every year. If you think you may have been preyed upon, please contact local law enforcement or submit a report to the Justice Department’s National Center for Disaster Fraud at 866-720-5721 or www.justice.gov/disastercomplaintform.

For more information on common phone and phishing scam tactics, visit the Federal Trade Commission’s website.

DALLAS — Tasha Lashaun Wilson, of Dallas, was sentenced last Friday by Chief U.S. District Judge Barbara M. G. Lynn to serve a prison sentence of 12 months and one day for theft of government funds, announced U.S. Attorney John Parker of the Northern District of Texas.

Wilson pleaded guilty in July 2015 to one count of theft of government money. Chief Judge Lynn ordered that Wilson be immediately remanded into federal custody at the conclusion of the sentencing hearing. Wilson was also order to pay back the loss to the government, none of which Wilson had attempted to pay back prior to the sentencing hearing.

According to documents filed in the case, on October 24, 2012, the United States Department of Housing and Urban Development (HUD) Office of Inspector General (OIG) received information about a Housing Choice Voucher Program (HCV) tenant believed to have a financial interest in the residence where she was living in Frisco, Texas.

A review of Wilson’s Dallas Housing Authority (DHA) tenant file revealed that she had been a HCV program participant since 2003. It was also determined that Wilson received United States Department of Agriculture (USDA) Supplemental Nutrition Assistance Program (SNAP) benefits and Medicaid assistance.

In 2010, Wilson was looking for a place to live while she was a participant in the HCV program. Wilson’s friend agreed to sign up to be an approved landlord in the HCV program so Wilson could live in his house in Frisco, Texas while she remained in the HCV program. As part of the process to be approved as a landlord, Wilson’s friend submitted a direct deposit form into which DHA would deposit money to subsidize Wilson’s rent. This direct deposit form listed a bank account to which both Wilson and her friend were signatories, but the submitted form did not disclose Wilson as a signatory to the account. Wilson told investigators that prior to submitting the direct deposit form, she told her friend that disclosing Wilson as a signatory to the joint bank account would be a problem because it would get her kicked out of the HCV program. Wilson’s friend told her that he would make sure Wilson’s name did not appear on the direct deposit form.

In September of 2010, Wilson completed and submitted an application to have her HCV rental subsidy transferred to her friend’s house in Frisco, Texas. From 2010 through into 2014, DHA deposited money into the joint bank account believing that it was sending money to Wilson’s landlord to subsidize her rent. Instead, Wilson accessed and spent the money at retailers and restaurants. Wilson was required to go through an annual re-certification process through which she was required to report income; Wilson did not disclose to DHA or HUD that she had access to, and was spending money from, the joint bank account. When confronted by law enforcement, Wilson admitted that she actively concealed the joint bank account because she knew that if she had reported it, she would have been kicked out of the HCV program.

An analysis of Wilson’s DHA HAP payments history from November 1, 2010, through February 28, 2014, revealed losses to DHA/HUD totaling $60,073.00. Similarly, an analysis of Wilson's SNAP benefit payments and Medicaid payments made during the same time period reveal losses to the government totaling $7,370.00 and $9,836.37, respectively.

HUD investigated the case. Assistant U.S. Attorney Jamie L. Hoxie prosecuted.

# # #

DALLAS – Following a three-day trial before Chief U.S. District Judge Barbara M. G. Lynn, a federal jury convicted Deborah Petty, 48, of Mesquite, Texas, on several identity theft offenses, announced U.S. Attorney John Parker of the Northern District of Texas.

 

Specifically, yesterday afternoon, the jury convicted Petty on seven counts of identity theft and one count of aggravated identity theft. Each of the identity theft counts carries a maximum statutory penalty of fifteen years in federal prison and a $250,000 fine. The aggravated identity theft count carries a $250,000 fine and a mandatory statutory penalty of two years in federal prison, consecutive to any other sentence Petty receives on Counts one through seven. Restitution could also be ordered. Sentencing has not yet been scheduled.

 

The government presented evidence at trial that Petty worked at the Western Regional Center for Brain and Spine Surgery (WRCBSS), a medical facility in Las Vegas, Nevada, between November 28, 2011, and June 29, 2012. In her position, and prior to her termination from WRCBSS, Petty obtained access to patient files, which included patients' names, dates of birth, and social security numbers. Petty understood and signed an acknowledgement that she would have access to confidential patient information and agreed that she would not disclose or share such information. Nonetheless, Petty stole hundreds of patient files and maintained possession of those files until May 2014, long after she left WRCBSS.

 

During the time in which she possessed these stolen identities, Petty used the identities in connection with a food stamp fraud scheme in the State of Florida. Approximately 110 individual patients from WRCBSS had food stamp benefits obtained in their name, totaling over $44,000 in losses to the government. Petty eventually moved to Mesquite and obtained new employment at another entity, Epic Healthcare Services, by overstating her qualifications and omitting her work at WRCBSS. In her new position, Petty again had access to patient identifiers and other personal information. In May 2014, the Mesquite Police Department recovered approximately 1,500 stolen identities possessed and maintained by Petty in an apartment in Mesquite.

 

The U.S. Department of Agriculture, U.S. Department of Health and Human Services Office of Inspector General and the Mesquite Police Department investigated the case. Assistant U.S. Attorneys Kate Rumsey and P.J. Meitl are in charge of the prosecution.

 

# # #

An Irving man was sentenced today to 14 years in federal prison for possession of multiple unregistered machine gun conversion sears as well as numerous drug crimes, announced U.S. Attorney for the Northern District of Texas Chad E. Meacham.

Ramon Navarro III, 23, pleaded guilty in March to four counts of an unregistered firearm and eight counts of distribution of controlled substances.  Because the government did not offer Mr. Navarro a plea deal, he pleaded open to the charges against him, with no assurances as to the term of imprisonment prosecutors would recommend to the judge. He was sentenced Monday by U.S. District Judge Sam A Lindsay.

According to court documents, Mr. Navarro, who used the aka “Trae Alvarez,” admitted that he possessed four machine gun conversion sears, three-piece devices designed to convert semiautomatic weapons into machineguns, all lacking serial numbers and of unknown origin. He also possessed six Glock pistols, each with an incorporated conversion sear, transforming the firearms into machine guns in operating condition.

(Unlike semiautomatic firearms, machineguns – weapons that can shoot more than one shot, without manual reloading, by single function of the trigger – are generally unlawful for civilians under the National Firearms Act.)

None of the firearms were registered to Mr. Navarro in the National Firearms Registration and Transfer Record, he admitted. He also admitted to trafficking in cocaine and heroin.

“This investigation is an example of ATF’s steadfast commitment to working with Dallas Police Department and all our local, state, and federal law enforcement partners in combining resources to combat violent crime, disrupt firearms trafficking, and ultimately create safer communities,” stated Jamey VanVliet,  Assistant Special Agent in Charge of the ATF’s Dallas Field Division.

The Bureau of Alcohol, Tobacco, Firearms & Explosives’ Dallas Field Division and the Dallas Police Department. Assistant U.S. Attorney Linda Requénez is prosecuting the case with the assistance of Assistant U.S. Attorney Walt Junker.

This case was prosecuted under Project Guardian, a Department of Justice initiative aimed at reducing gun violence by enforcing federal firearm laws through coordination between the federal government and state and local law enforcement.

A Plano man has been charged with racking up $1.6 million dollars in personal expenses on company credit cards, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.

On Tuesday, Steven Duety, 45, was indicted on one count of conspiracy to commit wire fraud and nine counts of wire fraud. He made his initial appearance before U.S. Magistrate Judge Rebecca Rutherford on Friday.

“It is unacceptable for an employee to steal from his employer,” said Acting U.S. Attorney Prerak Shah. “This defendant’s alleged abuse of his company credit card is wire fraud and the Northern District of Texas will not stand for this sort of misconduct.”

“Mr. Duety was in a position that required trust and integrity and his alleged actions abused his position,” said FBI Dallas Special Agent in Charge Matthew J. DeSarno. “The FBI will continue to work closely with our law enforcement partners to hold those who enrich themselves via fraudulent schemes accountable for their actions.”

According to the indictment, from 2015 to 2019, Mr. Duety oversaw fleet functions for Builders FirstSource, a publicly-traded construction products manufacturer. The company gave him access to several company credit cards, which he was supposed to use for fleet-related expenses, such as titling, renewing registration, etc.

Instead, Mr. Duety allegedly conspired with a relative, identified in court documents as “Person A,” to use the credit cards for personal expenses as well as inventory for their respective candle businesses, including “Steves The Man Candles.” 

Mr. Duety frequently charged company credit cards for nonexistent transactions via Square or Intuit, causing the payment processors to remit money from Builders FirstSource straight into his or Person A’s bank account. He and his coconspirators sometimes characterized these transactions as “car repair” or “fundraiser,” when no such things had occurred.

Mr. Duety allegedly spent the money on cars, dining (including expensive steakhouses), first class airline tickets, luxury hotels, car rentals, furniture, Amazon charges, toys, groceries, landscaping, a Netflix subscription, laser tag, and trips to Hooters, as well as first class airline tickets and kitchen appliances for Person A.

“This is really a pain in the butt,” Person A wrote in an email to Mr. Duety on October 18, 2016. “My story is you bought 100 fundraiser candles in case they call you.”

An indictment is merely an allegation of criminal wrongdoing, not evidence. Like all defendants, Mr. Duety is presumed innocent until proven guilty in a court of law.

If convicted, he faces up to 200 years, 20 years per count, in federal prison.

The Federal Bureau of Investigation’s Dallas Field Office conducted the investigation. Assistant U.S. Attorney Andrew Wirmani is prosecuting the case.