CONTACT: Barbara Burns

PHONE: (716) 843-5817

FAX #: (716) 551-3051

BUFFALO, NY – U.S. Attorney Trini E. Ross announced today that Adam Arena, 44, of Little Valley, NY, pleaded guilty before Senior U.S. District Judge William M. Skretny to conspiracy to commit bank fraud and engaging in monetary transactions with criminally derived proceeds for his role in fraudulently obtaining and laundering nearly $1 million in funds from the COVID-19 relief Paycheck Protection Program (PPP). The charges carry a maximum penalty of 30 years and a $1,000,000 fine.

Assistant U.S. Attorney Laura A. Higgins and Cory E. Jacobs of the Criminal Division’s Fraud Section, who are handling the case, stated that in May 2020, Arena reinstated his previously inactive business, ADA Auto Group, which had been inactive since 2018. Arena then provided his date of birth, social security number, address, and ADA Auto Group’s Employer Identification Number, Articles of Incorporation, along with a bank account number, for the purpose of facilitating the preparation of a fraudulent Paycheck Protection Program (PPP) loan. On July 27, co-defendant Amanda J. Gloria submitted a PPP loan application for ADA Auto Group to a financial institution via email seeking a $954,000 loan. Along with the application, Gloria submitted fraudulent supporting documents, including tax forms and payroll reports. These documents claimed ADA Auto Group employed 50 people in 2019 with an annual payroll of more than $4.4 million. On August 10, 2020, Arena directed the financial institution to wire the proceeds of the approved PPP loan for ADA Auto Group into a business account controlled exclusively by him. On September 11, 2020, Arena paid Gloria approximately $24,135 in PPP funds for facilitating the submission of the fraudulent PPP loan application. None of the funds Arena received were ever used for business-related expenses.

Charges remain pending against Amanda J. Gloria. The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.

The Coronavirus Aid, Relief, and Economic Security (CARES) Act is a federal law enacted on March 29, 2020, designed to provide emergency financial assistance to the millions of Americans who are suffering the economic effects caused by the COVID-19 pandemic. One source of relief provided by the CARES Act was the authorization of up to $349 billion in forgivable loans to small businesses for job retention and certain other expenses, through the PPP. In April 2020, Congress authorized over $300 billion in additional PPP funding.

The PPP allows qualifying small businesses and other organizations to receive loans with a maturity of two years and an interest rate of 1%. PPP loan proceeds must be used by businesses on payroll costs, interest on mortgages, rent, and utilities. The PPP allows the interest and principal on the PPP loan to be forgiven if the business spends the loan proceeds on these expense items within a designated period of time after receiving the proceeds and uses at least a certain percentage of the PPP loan proceeds on payroll expenses.

The Fraud Section leads the Department of Justice’s prosecution of fraud schemes that exploit the CARES Act. In the months since the CARES Act was passed, Fraud Section attorneys have prosecuted more than 100 defendants in more than 70 criminal cases. The Fraud Section has also seized more than $65 million in cash proceeds derived from fraudulently obtained PPP funds, as well as numerous real-estate properties and luxury items purchased with such proceeds. More information can be found at: https://www.justice.gov/criminal-fraud/cares-act-fraud.

Anyone with general information about allegations of attempted fraud involving COVID-19 can report it by calling the Justice Department’s National Center for Disaster Fraud Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.

The plea is the result of an investigation by the Federal Bureau of Investigation, under the direction of Special Agent-in-Charge Stephen Belongia and the Internal Revenue Service, Criminal Investigation Division, under the direction of Thomas Fattorusso, Special Agent-in-Charge.

Sentencing is scheduled for March 2, 2022, at 10:00 a.m. before Judge Skretny.

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CONTACT: Barbara Burns

PHONE: (716) 843-5817

FAX #: (716) 551-3051

BUFFALO, N.Y.--U.S. Attorney James P. Kennedy, Jr. announced today that Laura Ricotta, 29, of Buffalo, who was convicted of conspiring to possess with intent to distribute, and distributing, oxycodone, hydrocodone, and amphetamine, was sentenced to time served (approximately 15 months) by U.S. District Judge Lawrence J. Vilardo.

Assistant U.S. Attorneys Timothy C. Lynch and Joshua Violanti, who handled the case, stated that between April 2015 and February 2018, the defendant conspired with co-defendant Dr. James T. Keefe, and others to sell oxycodone, hydrocodone, and amphetamine, all Schedule II controlled substances. Ricotta met Dr. Keefe, who was a New York State licensed physician and a DEA Registrant authorized to issue prescriptions for Schedule II and Schedule IV controlled substances, through her boyfriend, co-defendant Benjamin Rivera. The defendant has known Dr. Keefe for nearly five years and during this time, Dr. Keefe was active user of cocaine, Adderall, and prescription opiates. In April 2015, Dr. Keefe reached out and asked Ricotta to allow him to issue prescriptions in her name and the defendant agreed.

Between April 20, 2015, and February 20, 2018, Ricotta was issued 15 prescriptions in her own name by Dr. Keefe for Schedule II and Schedule IV controlled substances. The defendant also used the names and personal information of six relatives and associates to receive 26 fraudulent prescriptions. Neither Ricotta nor any of her relatives or associates were patients of Dr. Keefe, and none of the relatives and associates knew their information was being used.

Co-defendants Dr. Keefe and Rivera were previously convicted and are awaiting sentencing.

The sentencing is the result of an investigation by the Drug Enforcement Administration, under the direction of Special Agent-in-Charge Ray Donovan.

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CONTACT:  Barbara Burns

PHONE:         (716) 843-5817

FAX #:            (716) 551-3051

ROCHESTER, N.Y.- U.S. Attorney James P. Kennedy, Jr. announced today that Christopher Parris, 39, currently of Atlanta, GA, formerly of Rochester, NY, was arrested and charged by criminal complaint with conspiracy to commit mail fraud, mail fraud, and conspiracy to engage in money laundering. The charges carry maximum penalty of 20 years in prison and a $500,000 fine.

Assistant U.S. Attorney John J. Field, who is handling the case, stated that Parris and his partner, Perry Santillo, doing business as Lucian Development, headquartered in Rochester, NY, operated an investment fraud Ponzi scheme from approximately January 2012 to June 2018. The Ponzi scheme defrauded approximately 1000 investors out of at least $115,500,000.

The investment offerings pitched by Parris and Santillo consisted principally of unsecured promissory notes and preferred stock issued by various entities that they controlled.  Potential investors were offered an array of investment options to create the illusion of a diversified investment portfolio.  Those investment options included products issued by purported issuers such as First Nationle Solutions (FNS), Percipience Global Corporation, United RL Capital Services, Boyles America, Middlebury Development Corporation, and NexMedical Solutions, among others.  None of those issuers had substantial bona fide business operations or used investor money in the manner and for the purposes represented to investors.  To the extent that an issuer may have had some minor legitimate business activities, it was not profitable and insufficient revenues were generated to pay investors any returns (let alone return the principal amounts of their investments).

Over the years, to keep the Ponzi scheme from being detected, a substantial portion of incoming new investor monies were depleted by making promised interest and other payments to earlier investors. Most of the rest of incoming investor money was used to finance lavish lifestyles of the conspirators, their families and associates; to expand the scheme by purchasing investment advisor/brokerage businesses to obtain access to fresh investors; and to pay operating expenses – salaries for a sales force and administrative staff, office rents and related expenses, housing for employees, and interest on loans—all of which were in furtherance of keeping the scheme going and maintaining a façade of legitimate business operations.

The defendant made an initial appearance before U.S. Magistrate Judge Marian W. Payson and was released pending further proceedings.

Perry Santillo previously pleaded guilty for his role in the scheme and is awaiting sentencing.

The criminal complaint is the result of an investigation by the United States Postal Inspection Service, under the direction of Inspector-in-Charge Joseph W. Cronin of the Boston Division; the Federal Bureau of Investigation, Buffalo Division, under the direction of Special Agent-in-Charge Gary Loeffert, and FBI Scranton Division; the Internal Revenue Service, Criminal Investigation Division, under the direction of Jonathan D. Larsen, Special Agent-in-Charge; the U.S. Department of Labor, Office of Inspector General, Office of Investigations – Labor Racketeering and Fraud, under the direction of Michael C. Mikulka, Special Agent-in-Charge, New York Region; the New York State Department of Financial Services, under the direction of Superintendent Linda A. Lacewell; and the Securities and Exchange Commission.

The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.  

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CONTACT:  Barbara Burns

PHONE:         (716) 843-5817

FAX #:            (716) 551-3051

BUFFALO, N.Y.-U.S. Attorney James P. Kennedy, Jr. announced today that Michael Martin, 58, of Virginia Beach, Virginia, who was convicted of conspiracy to commit wire fraud, was sentenced to 48 months in prison by U.S. District Judge Elizabeth A. Wolford. The defendant was also ordered to pay restitution totaling $1,113,000.

Assistant U.S. Attorneys MaryEllen Kresse and Elizabeth R. Moellering, who handled the case, stated that in March 2013, the defendant, operating as Capital Source Lending, LLC, agreed to work with co-defendant Christopher Venti, operating as Viewpoint Solutions Group and Secured Strategies LLC, to establish a fraudulent investment scheme involving multiple victims.

Victims who were interested in obtaining funding were solicited by Christopher Venti and others. The solicitations involved false promises of, among other things, access to “blocked” bank accounts that purportedly contained the funds victims sought. Victims were required to make advance payments into escrow in order to establish the “blocked” bank accounts in their names. Victims were falsely and fraudulently told that the “blocked” bank accounts would contain 10 times the amount of funds placed in escrow and would be accessible to the victims in approximately 30 days. The advance payments were to be released from escrow by the victim upon the victim’s confirmation that the “blocked” bank account had been established in the victim’s name.

Victims were given letters on bank letterhead that purported to confirm the existence of the “blocked” bank accounts. In reality, the defendant Martin, Venti, and others knew that the bank letters were fraudulent, and that the confirmation process established in the escrow agreements signed by the victims, was fraudulent. Pre-arranged numbers victims were instructed to call directed them to others involved in the scheme who falsely represented to victims that they worked at the respective bank and that they could confirm the existence of the claimed “blocked” bank account.

Defendant Martin and Venti attempted to obtain $1,240,000 from six individuals, two of whom sent the defendant and Venti a total of $300,000. Martin also admitted his involvement in two other fraudulent schemes, both involving false representations that Martin could obtain funding for the victims through the alleged “monetizing” of a bank instrument.  None of the defendant’s victims received the funds promised by the defendant.

Christopher Venti has been convicted for his involvement in this and other investment fraud schemes and is awaiting sentencing. 

Today’s sentencing is the result of an investigation by the Federal Bureau of Investigation, under the direction of Acting Special Agent-in-Charge Kevin P. Lyons. 

ROCHESTER, N.Y. - U.S. Attorney Trini E. Ross announced today that Mark Remein, 41, and Derek Verna, 44, both of Rochester, NY, were arrested and charged by criminal complaint with committing and conspiring to commit wire fraud, interstate transportation and sale of stolen property, and money laundering. The charges carry a maximum penalty of 20 years in prison.

Assistant U.S. Attorney Meghan K. McGuire, who is handling the case, stated that according to the complaint, Remein and Verna owned and/or operated West Ridge Connections, a pawn shop located on West Ridge Road in Rochester. Remein and Verna knowingly purchased stolen, new-in-box items from serial shoplifters for a fraction (approximately 30%) of the items’ retail value. Remein and Verna listed the items for sale on eBay and shipped them to buyers. The items were listed as “New” and priced below retail value. In total, between January 2020, and August 16, 2023, Remein and Verna purchased and re-sold on eBay approximately 8,100 “New” items and received approximately $497,842 for those sales. The money was deposited into bank accounts that were opened in the name of third parties to avoid detection.  

The investigation began in February 2022, after law enforcement received a complaint from Home Depot security personnel, who had followed a shoplifter from a Home Depot location to West Ridge Connections with recently stolen merchandise. A store  security manager entered West Ridge Connections and observed the stolen merchandise behind a table counter. None of the stolen merchandise was entered into LeadsOnline, an online database where secondhand dealers, like Remein and Verna, are required to report all purchases from other individuals. The investigation determined that individuals sold new-in-box items to West Ridge Connections on a regular basis. Some of the sellers were admitted opioid users, whom law enforcement observed attempting to buy drugs immediately after they sold new-in-box items to West Ridge Connections.

In December 2022, investigators made a controlled sale of three, new-in-box Google Nest thermostats to defendant Verna at West Ridge Connections. The combined retail value of the items was approximately $567.00. Verna paid $100.00 for all three items before listing them on eBay for $124.99 each. Between January and August of 2023, investigators conducted a total of 15 controlled sales, which included 37 items.

The complaint is the result of an investigation by the Internal Revenue Service, Criminal Investigation Division, under the direction of Thomas Fattorusso, Special Agent-in-Charge, and the Rochester Police Department, under the direction of Chief David Smith.

 The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.      

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CONTACT:    Barbara Burns

PHONE:    (716) 843-5817

FAX #:    (716) 551-3051

BUFFALO, N.Y.-U.S. Attorney Trini E. Ross announced today that a federal grand jury returned a 12-count indictment charging Joshua Parra, 31, formerly of Buffalo, NY, now living in Melbourne, Florida, with bank fraud and money laundering conspiracy. The charges carry a maximum penalty of 30 years in prison and a $1,000,000 fine. 

 

Assistant U.S. Attorney Charles M. Kruly, who is handling the case, stated that according to the indictment, Parra defrauded Bancorp and Stride Bank by creating 94 fictitious disputed transactions on behalf of 11 customers of Fintech Company 1, a financial technology company that offers customers mobile banking services. However, none of the 11 customers’ accounts with Fintech Company 1 had transactions that would justify such disputes. Nearly all of the fictitious disputed transactions were in the amount of $5,000. As a result, funds were transferred from settlement accounts, held at Bancorp and Stride Bank, to accounts maintained by the Fintech Company 1 customers for whom Parra created the fictitious disputed transactions. Losses to Bancorp and Stride Bank totaled approximately $450,000.

 

The indictment is the result of an investigation by the Internal Revenue Service, Criminal Investigation Division, under the direction of Special Agent in Charge Thomas Fattorusso, and the Federal Bureau of Investigation, under the direction of Acting Special Agent-in-Charge Darren Cox.  

 

The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.   

 

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CONTACT: Barbara Burns

PHONE: (716) 843-5817

FAX #: (716) 551-3051

BUFFALO, N.Y. -- U.S. Attorney James P. Kennedy, Jr. announced today that Leonard Smith, 54, of Clawson, Michigan, pleaded guilty to conspiracy to commit wire fraud, before U.S. District Judge Richard J. Arcara. The charge carries a maximum penalty of 20 years in prison and a $769,200 fine.

Assistant U.S. Attorney Douglas A. Penrose, who is handling the case, stated that between May 2010 and July 2015, the defendant conspired with others fraudulently to obtain money and property from investors. As part of the scheme, Smith, who was a financial advisor, solicited investments from his clients at two companies—i2i Capital LLC and i2i Settlement Partners LLC. The companies, which were formed by co-conspirators Christopher Dillon and Gilbert Lynagh, were incorporated in Delaware but listed a business address in Lancaster, NY.

Thereafter, Smith, Dillon, Lynagh, and other members of the conspiracy, caused 27 victims to invest over $5,000,000 in i2i Capital and/or i2i Settlement Partners. False and fraudulent representations were made to victims regarding the nature of the investment and the associated risks, duration, and rates of return. Smith also misrepresented his compensation regarding the victims’ investments in the companies.  The majority of victim funds were utilized by Smith, Dillon, Lynagh, and other members of the conspiracy in a manner that was not authorized by the victims, including for personal use. None of the victims received the promised return on their investments, and none saw the return of their original investment funds as promised by Smith, Dillon, and Lynagh.

Gilbert Lynagh and Christopher Dillon were previously convicted for their roles in the conspiracy.

The plea is the result of an investigation by the Federal Bureau of Investigation, Buffalo Office, under the direction of Special Agent-in-Charge Gary Loeffert.

Sentencing is scheduled for November 18, 2019, at 12:30 p.m. before Judge Arcara.

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CONTACT:  Barbara Burns

PHONE:         (716) 843-5817

FAX #:            (716) 551-3051

BUFFALO, N.Y. - U.S. Attorney James P. Kennedy, Jr. announced today that Raymond Whelan, 49, of Cheektowaga, NY, pleaded guilty before U.S. District Judge Richard J. Arcara to conspiracy to traffic in counterfeit goods. The charge carries a maximum penalty of 10 years in prison and a $2,000,000 fine.

Assistant U.S. Attorney Michael DiGiacomo, who is handling the case, stated that the defendant operates Rayscarparts71.com. Between June 2015 and March 2016, Whelan and co-defendant David Nichols entered into an agreement to sell counterfeit automobile airbags. Whelan would contact Nichols and order numerous airbags bearing counterfeit trademarks of Honda, Toyota, Nissan, Subaru, Mazda, Hyundai, Acura, and Mitsubishi. Nichols would then locate manufacturers in China to supply the requested airbags.

In order to avoid detection during importation, the airbags were mislabeled. Once imported into the United States, Whelan would sell the airbags on eBay utilizing the name Rayscarparts71. The airbags were listed on eBay as genuine used airbags designed to fit Honda, Toyota, Nissan, Subaru, Mazda, Hyundai, Acura, and Mitsubishi.

During the investigation, multiple undercover purchases were made from Rayscarparts71 and airbags were seized from the defendant’s business. All the purchased and seized airbags were determined to be counterfeit. The airbags also contained trademarks of Honda, Toyota, Nissan, Subaru, Mazda, Hyundai, Acura, and Mitsubishi, trademarks registered with the United States Patent and Trademark Office. None of these companies authorized the defendant to utilize their trademarks.

Whelan imported and sold more approximately 360 counterfeit automobile airbags with an average manufacturer’s retail price of $650.00. The total infringement amount was $236,600.

Co-defendant David Nichols was previously convicted and is awaiting sentencing.

The plea is the result of an investigation by Immigration and Customs Enforcement, Homeland Security Investigations, under the direction of Special Agent-in-Charge Kevin Kelly and Customs and Border Protection, under the direction of Rose Brophy, Director of Field Operations.

Sentencing is scheduled for December 17, 2018, at 1:00 p.m. before Judge Arcara.

CONTACT: Barbara Burns

PHONE: (716) 843-5817

FAX #: (716) 551-3051

BUFFALO, N.Y. - U.S. Attorney James P. Kennedy, Jr. announced today that Roberto Montes-Villalpando, 60, of Sanborn, NY, and Abraham Montes, 29, of North Tonawanda, NY, who were convicted of conspiring to harbor aliens for financial gain and causing serious bodily injury, were sentenced by U.S. District Judge Lawrence J. Vilardo. Roberto Montes-Villalpando was sentenced to serve 18 months home incarceration, while his son, Abraham Montes was sentenced to serve six months in prison and six months home detention.

Assistant U.S. Attorneys Meghan A. Tokash and Laura A. Higgins, who handled the case, with support from the Department of Justice’s Civil Rights Division’s Human Trafficking Prosecution Unit, stated that the defendants owned and operated El Cubilete Mexican Restaurant, in Niagara Falls, NY.   Between December 2014 and late 2018, the restaurant was located at 9400 Niagara Falls Boulevard.  In late-2018, the restaurant moved to 2050 Cayuga Extension in Niagara Falls. Defendant Montes-Villalpando managed the restaurant, supervised the staff, including wait and kitchen staff, made hiring and firing decisions, and determined payroll. Defendant Montes supervised the kitchen staff, which included Victims 1, 2, 3, and 4, who were each natives and citizens of Mexico.  The victims—none of whom had legal status in the United States—were employed by the defendants as cooks, food preparers, and dishwashers. In addition, the victims sublet a Niagara Falls apartment rented by defendant Montes-Villalpando.

Between November 1, 2014, and February 18, 2018, the defendants recruited and hired undocumented foreign nationals who had entered the United States illegally to work for them. Montes-Villalpando and Montes enticed prospective laborers who lived and worked in Ohio, including Victim 1 and Victim 2, to work at El Cubilete by promising them better pay and fewer hours. During their employment, Victims 1, 2, 3, and 4 were paid less than required by the Fair Labor Standards Act and by New York State law, which required a minimum wage of $9/hour. According to analysis performed by the Department of Labor, Office of the Inspector General, the victims were underpaid in the following amounts respectively: Victim 1—$5,386.60; Victim 2—$8,513.44; Victim 3—$61,665.40; and Victim 4—$6,006.60.

Additionally, in about February 2018, defendant Montes punched Victim 3 in the nose and stated he would kill Victim 3. Montes then used a fire extinguisher to strike Victim 3 in the head causing him to fall to the ground. Victim 3 was transported to a hospital for medical treatment where he was diagnosed with a broken nose and a laceration on his head was closed with staples.

The sentencings are the result of an investigation by the Homeland Security Investigations, under the direction of Acting Special Agent-in-Charge Matthew Scarpino; the Erie County Sheriff’s Office, under the direction of Sheriff Timothy Howard; the U.S. Department of Labor, Office of Inspector General, Office of Investigations – Labor Racketeering and Fraud, under the direction of Jonathan Mellone, Special Agent-in-Charge of the New York Region; and the Human Trafficking Task Force of Western District New York, which is co-led by the United States Attorney's Office, Erie County Sheriff's Office, and International Institute of Buffalo.

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CONTACT: Barbara Burns

PHONE: (716) 843-5817

FAX #: (716) 551-3051

BUFFALO, N.Y.--U.S. Attorney James P. Kennedy, Jr. announced today that James T. Keefe, 40, of Florida, who was convicted of conspiring to possess with intent to distribute, and distributing, oxycodone, hydrocodone, and amphetamine, was sentenced to serve 60 months in prison by U.S. District Judge Lawrence J. Vilardo. The defendant was also sentenced to serve five years supervised release to include six months home detention.

“This case highlights the powerful grip of addiction,” stated U.S. Attorney Kennedy. “The defendant was a medical professional and was well aware of the dangers of the illegal use of prescription medications, yet he created a web of accomplices which allowed him to obtain controlled substances and continue to fuel his addiction.”  

“Now, more than ever, the public entrusts doctors with their health and well-being.  Today’s sentence demonstrates that when a doctor betrays that trust and risks the welfare of others, there are very real consequences,” said DEA Special-Agent-in-Charge Ray Donovan. “I applaud the hard work of our Buffalo District Office Diversion Investigators and Intelligence Analysts, as well as the fortitude of our colleagues at the U.S. Attorney’s Office, Western District of New York, who saw this case through.”

Assistant U.S. Attorney Joshua Violanti, who handled the case, stated that the defendant was a New York State licensed physician who was previously employed as a contracted physician at the Erie County Medical Center (ECMC), Mercy Hospital of Buffalo, and the Monsignor Carr Institute. Between January 1, 2014, and February 23, 2018, Keefe conspired to divert, and diverted, Schedule II and Schedule IV controlled substances by issuing fraudulent prescriptions to his co-workers, friends, and drug-dealing and drug-using associates, including, co-defendants Benjamin Rivera, Laura Ricotta, Takeya Rainey, and Phousavath Luangrath. These prescriptions were issued without a legitimate medical purpose and outside the usual course of professional practice.

The defendant and co-defendant Rivera have been associates for several years. For nearly five years, Rivera sold cocaine to Keefe, who was active user of cocaine, Adderall, and prescription opiates. In January 2014, the defendant began issuing prescriptions in the names of Rivera and nine of Rivera’s relatives and associates to exchange for cocaine and for a share of the prescribed drugs. Neither Rivera nor any of his relatives or associates were patients of Keefe.

In April 2015, the defendant began issuing prescriptions to Rivera’s girlfriend, co-defendant Laura Ricotta. Keefe also used the names and personal information of six relatives and associates of Ricotta to issue fraudulent prescriptions. Neither Ricotta nor any of her relatives or associates were patients of the defendant. Keefe often drove Ricotta to a pharmacy to a pharmacy to fill the prescriptions, which the two then split.

In the summer of 2017, the defendant began issuing prescriptions to co-defendant Takeya Rainey. Rainey also provided the names of her relatives and associates to Keefe, none of whom were his patients. In exchange for the controlled substances, the defendant sometimes gave Rainey gift or Visa cash cards.

Beginning in January of 2017, Keefe and co-defendant Luangrath were involved in an intimate relationship. At some point, the defendant Luangrath agreed to allow the defendant to issue prescriptions in her name.

Between January 1, 2014, and February 23, 2018, the defendant issued 179 fraudulent prescriptions in his own name and the names of others, for Schedule II and Schedule IV controlled substances.

Defendants Rivera, Ricotta and Luangrath were previously convicted and sentenced. Rivera was sentenced to time served (28 months). Ricotta was also sentenced to time served (15 months). Luangrath was sentenced to serve one-year probation. Defendant Rainey was also previously convicted and is awaiting sentencing.

Today’s sentencing is the result of an investigation by the Drug Enforcement Administration, under the direction of Special Agent-in-Charge Ray Donovan.

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CONTACT:      Barbara Burns

PHONE:         (716) 843-5817

FAX:            (716) 551-3051

BUFFALO, N.Y.-Acting U.S. Attorney James P. Kennedy, Jr. announced today that Michael Martin, 58, of Virginia Beach, Virginia, pleaded guilty to conspiracy to commit wire fraud before U.S. District Judge Elizabeth A. Wolford. The charge carries a maximum penalty of 20 years and a $250,000 fine.



Assistant U.S. Attorneys MaryEllen Kresse and Elizabeth R. Moellering, who are handling the case, stated that in March 2013, the defendant, operating as Capital Source Lending, LLC, agreed to work with co-defendant Christopher Venti, operating as Viewpoint Solutions Group and Secured Strategies LLC, on a fraudulent investment scheme involving multiple victims.



Victims who were interested in obtaining funding were solicited by Christopher Venti, and others. The solicitations involved false promises of, among other things, access to “blocked” bank accounts that purportedly contained the funds victims sought. Victims were required to make advance payments into escrow in order to establish the “blocked” bank accounts in their names. Victims were falsely and fraudulently told that the “blocked” bank accounts would contain 10 times the amount of funds placed in escrow, and would be accessible to the victims in approximately 30 days. The advance payments were to be released from escrow by the victim upon the victim’s confirmation that the “blocked” bank account had been established in the victim’s name.



Victims were given letters on bank letterhead that purported to confirm the existence of the “blocked” bank accounts. In reality, the defendant Martin, Venti, and others knew that the bank letters were fraudulent, and that the confirmation process established in the escrow agreements signed by the victims, was fraudulent. Pre-arranged numbers victims were instructed to call directed them to others involved in the scheme who falsely represented to victims that they worked at the respective bank and that they could confirm the existence of the claimed “blocked” bank account.



Defendant Martin and Venti attempted to obtain $1,240,000 from six individuals, two of whom sent the defendant and Venti a total of $300,000. Martin also admitted his involvement in two other fraudulent schemes, both involving false representations that Martin could obtain funding for the victims through the alleged “monetizing” of a bank instrument.  None of the defendant’s victims received the funds promised by the defendant.

Christopher Venti has been convicted for his involvement in this and other investment fraud schemes and is awaiting sentencing. 



Today’s plea is the result of an investigation by the Federal Bureau of Investigation, under the direction of Special Agent-in-Charge Adam S. Cohen. 



Sentencing is scheduled for February 27, 2018, at 4:00 p.m., before Judge Wolford.

CONTACT: Barbara Burns

PHONE: (716) 843-5817

FAX #: (716) 551-3051

BUFFALO, N.Y.--U.S. Attorney James P. Kennedy, Jr. announced today that Troy R. Gillon, 46, of Lockport, NY, who was convicted of narcotics conspiracy following an eight week jury trial, was sentenced to serve 25 years in prison by U.S. District Judge Lawrence J. Vilardo.

“Make no mistake, though their operations were centered over 2,500 miles away, the reach of the harm done by the Sinaloa Cartel extended all of the way here to Western New York,” noted U.S. Attorney Kennedy. “They poured poison into our community and made millions of dollars at the expense of the health, well-being—and in some instances the lives—of those who ingested them. Those individuals, such as the defendant, who sought to profit from the Cartel’s business model as established by its leader, El Chapo, deserve a similar return on their investment as he got—a sentence which will result in him spending the rest of his life in federal prison.”

Assistant U.S. Attorney Meghan A. Tokash, who handled the prosecution of the case, stated that Gillon was a member of a transnational drug trafficking organization, led by co-defendant Herman E. Aguirre, that utilized contacts and a source of supply whose territory included Mexico, Arizona, California, and elsewhere. The source of supply was the Sinaloa Cartel, led by Joaquín “El Chapo” Guzmán and Ismael “El Mayo” Zambada. 

The local organization trafficked thousands of kilograms of illegal narcotics, including heroin, fentanyl, and cocaine throughout the United States, including Lockport, Niagara Falls, and Buffalo, via the mail, individual vehicles outfitted with “trap” compartments, and on pallets loaded on tractor trailers. Members of the organization created fictitious “front” companies to launder drug proceeds including Triton Foods, Inc., Kamora Investment Enterprises, Inc. and Fresh Choice Produce, all of which were incorporated in the State of California. Another fictitious company, Corral Seafoods, LLC, registered in the State of New York, was allegedly located in Cheektowaga, NY, but proved to be completely fake.

Using these companies, Gillon and his co-defendants disguised kilogram quantities of heroin, fentanyl, and cocaine on pallets described on inventory and other documents as containing “Sea Cucumbers.” Evidence presented by the Government at trial showed that sea cucumbers are commonly found in Southeast Asia and Europe but rarely, if ever, in Western New York State. The pallets bearing the illegal narcotics were secreted in containers sealed with foam or spray insulation to avoid detection by law enforcement.

Members of the organization also utilized numerous bank accounts at local Bank of America branches to deposit illegal drug proceeds. Local members of the drug trafficking organization deposited over $19,000,000 of illegal drug proceeds into these fake seafood accounts, while California conspirators created false invoices to make it look like Western New Yorkers were buying sea cucumbers at astounding rates and quantities. The Western New York Asset Protection Manager of Wegman’s Food Markets, Inc. testified at the trial that none of its 13 Western New York stores have ever carried sea cucumbers because there is no demand for the product in Buffalo and the surrounding areas.

During the course of the investigation, law enforcement officers seized over $5,000,000 worth of illegal narcotics, including:

•           52.5 kilograms of cocaine;

•           17.5 kilograms of heroin; and

•           8.5 kilograms of fentanyl

Using standard dosage amounts, the seized drugs potentially represented over 1,500,000 “hits” of cocaine, and 2,700,000 “hits” of heroin and considering that two milligrams of fentanyl can be a lethal dose, enough fentanyl potentially to kill over four million people. Further evidence presented by the Government at trial revealed that after a December 2014 meeting in Buffalo, defendant Aguirre shipped 10 kilograms of fentanyl to Buffalo and defendant Gillon took possession of the 10 kilograms. Gillon sold two kilograms of the fentanyl before residents of the Lockport area started overdosing on the drug shortly after New Year’s Day, 2015. A DEA representative testified that Gillon told police that he returned the remaining eight kilograms to a co-conspirator in early March 2015 because, “People are dying off this (expletive).” The co-conspirator moved the remaining fentanyl, along with two kilograms of cocaine, and 22 kilograms of heroin, to a house on Folger Street in the City of Buffalo.  On March 23, 2015, Buffalo Police seized 32 kilograms of drugs from the Folger Street location—including Gillon’s eight kilograms of fentanyl.

The investigation further determined that between June 2013 and September 2015, members of the organization additionally distributed over 5,000 pounds of cocaine, heroin, fentanyl and marijuana in the Western New York area. Approximately $20,000,000 was sent from Western New York banks to California in a two year period of time.

Herman Aguirre was also convicted at trial of narcotics conspiracy, as well as operating a continuing criminal enterprise and money laundering conspiracy, and is scheduled to be sentenced on February 23, 2021. A total of 18 defendants were charged and convicted in this case.

The sentencing is the result of an investigation by the Drug Enforcement Administration, under the direction of Special Agent-in-Charge Ray Donovan, New York Field Division; Homeland Security Investigations, under the direction of Special-Agent-in Charge Kevin Kelly; the Internal Revenue Service, Criminal Investigation Division, under the direction of Jonathan D. Larsen, Special Agent-in-Charge, New York Field Office; the Niagara County Drug Task Force, under the direction of Sheriff Michael Filicetti; the Buffalo Police Department, under the direction of Commissioner Byron Lockwood; the Lockport Police Department, under the direction of Chief Steven Abbott; the Montebello, California Police Department; the Nebraska State Patrol; and the DEA, Los Angeles.

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