CHICAGO — A federal judge today sentenced the former owner of a rooftop building overlooking Wrigley Field to 18 months in prison for defrauding the Chicago Cubs and municipal taxing agencies.
R. MARC HAMID, 48, of Lincolnwood, was convicted last year on four counts of mail fraud and five counts of illegally structuring financial transactions. U.S. District Judge Thomas M. Durkin imposed the sentence in federal court in Chicago.
“Time and again, Hamid returned to one principle above all others: wherever he thought he could cut corners and put more money in his own pocket, he did it,” Assistant U.S. Attorney Barry Jonas argued in the government’s sentencing memorandum. “If there was a way to benefit himself even if to another’s detriment, he did it.”
The sentence was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; E.C. Woodson, Postal Inspector-in-Charge of the U.S. Postal Inspection Service in Chicago; and James D. Robnett, Special Agent-in-Charge of the Internal Revenue Service Criminal Investigation in Chicago.
Hamid was a licensed Illinois attorney and a former owner and operator of Right Field Rooftops LLC, which did business as Skybox on Sheffield, a rooftop entertainment venue located across the street from Wrigley Field’s right field wall. Hamid also owned and operated JustGreatTickets.com Inc. and Just Great Seats LLC, companies that purchased and re-sold tickets to entertainment and sporting events.
Skybox on Sheffield and other rooftop venues surrounding Wrigley Field had an agreement with the Cubs that required, among other things, that each rooftop pay the Cubs a royalty of 17% of their gross annual revenues. In addition, Cook County and the city of Chicago required the rooftops to pay an amusement tax on admission fees, and to report its amusement tax returns to the municipalities. The state of Illinois also required Skybox on Sheffield to file sales tax returns and to pay the state a certain dollar amount per ticket sold.
Evidence at Hamid’s nine-day trial revealed that for the years 2008 through 2011, Hamid caused Skybox on Sheffield to submit false annual royalty statements to the Cubs that under-reported attendance figures by thousands of paid attendees, and under-reported gross revenues by $1.4 million. At Hamid’s direction, sales from Skybox on Sheffield were diverted to the two ticket companies, thus concealing from the Cubs, Cook County and the city of Chicago Skybox on Sheffield’s true revenue.
Hamid’s accountant, JOSEPH GURDAK, further reduced the attendance and revenue figures reported to the Cubs. Gurdak pleaded guilty last year to one count of mail fraud and one count of willfully filing a false income tax return.
The government is represented by Mr. Jonas and Assistant U.S. Attorneys Sean Driscoll and Katherine Welsh.
IGNACIO – Acting United States Attorney for the District of Colorado Matt Kirsch hosted the 31st Annual Four Corners Indian Country Conference in Ignacio, Colorado this week.
The three-day event, held at the Sky Ute Casino Resort, focused on collaboration, commitment, and relationship building between the Department of Justice, Offices of the United States Attorneys in the region, and tribal communities.
“Our office and the Department of Justice have a long-held commitment to tribal communities here in Colorado and across the west,” said Acting United States Attorney for the District of Colorado Matt Kirsch. “I am proud of the work we do to support our Indian Country partners and appreciate our ability to come together to better our working relationships.”
Started in 1992, The Four Corners Indian Country Conference focuses on prosecution, justice, and victims’ issues in Indian Country, specifically in the “four corners” states of Colorado, Arizona, New Mexico, and Utah. The District of Colorado was proud to highlight additional efforts put in place this year to support the law enforcement on tribal lands including the hiring of additional federal prosecutors, law enforcement trainings, and successful prosecutions which sought justice for victims of domestic violence and sexual assault.
Colorado is home to two federally recognized tribes, the Southern Ute and the Ute Mountain Ute. In addition to critical meetings focused on law enforcement and legal issues, the conference featured speakers, cultural presentations, and a local tribal artist to help attendees celebrate the rich cultural legacy of these tribes.
Next year’s Four Corners Indian Country Conference will be held in New Mexico.
SAN FRANCISCO – John Morrison was sentenced to three years in prison for possessing child pornography, announced United States Attorney David L. Anderson. The sentence was handed down by the Honorable Charles R. Breyer, U.S. District Judge.
Morrison, 73 of San Francisco, pleaded guilty to the charge on June 19, 2019. According to his plea agreement, Morrison admitted that in March 2017, he possessed more than 600 videos and images that contained child pornography and that he used Skype to download the videos and images. Morrison further acknowledged that at the time he possessed the images, he worked with youth at the California Film Institute in San Rafael, Calif., as the Director of Education, where he taught film education to his students.
A federal grand jury indicted Morrison on June 5, 2018, charging him with receipt of child pornography, in violation of 18 U.S.C. § 2252(a)(2) and (b)(1), and possession of child pornography, in violation of 18 U.S.C. § 2252(a)(4)(B). Morrison pleaded guilty to the possession count and the receipt count was dismissed at sentencing.
This investigation began with cyber-tips made to the National Center for Missing and Exploited Children. The cyber-tips indicated that an individual was using Skype to upload child pornography. Law enforcement eventually identified the defendant as the user of the specific Skype account being used to upload the images.
In addition to the prison term, Judge Breyer sentenced the defendant to a five-year period of supervised release, ordered him to pay $2,500 in restitution, and required that he register as a sex offender as required by state law. Judge Breyer ordered the defendant to surrender and begin serving the prison term no later than January 13, 2020.
Assistant U.S. Attorney Ross Weingarten is prosecuting the case with the assistance of Marina Ponomarchuk. The prosecution is the result of an investigation by the San Francisco Police Department, Internet Crimes Against Children Unit.
PORTLAND, Ore.—U.S. Attorney Billy J. Williams announced today that a Hillsboro, Oregon, resident has been charged with assaulting a federally deputized Portland Police officer with the pointed end of an umbrella and interfering with law enforcement officers performing their official duties during a civil disorder event.
A federal grand jury in Portland has returned a two-count indictment charging Skyler Roy Rider, 18, with Civil Disorder and Assaulting a Federal Officer.
According to court documents, late on the evening of October 6, 2020 and into October 7, a crowd gathered and a march began at Elizabeth Caruthers Park located in the 3500 block of South Moody Avenue. The group walked to the U.S. Immigration and Customs Enforcement (ICE) building on South Macadam Avenue. Portland Police Bureau (PPB) officers observed many in the crowd carrying shields, wearing helmets, gas masks, and body armor. As the group marched towards the ICE building, support vehicles followed them as they blocked streets.
As the crowd arrived at the ICE building, people in the crowd were observed flashing lights in the eyes of Federal Protection Services (FPS) officers as they stood outside the ICE building. People in the crowd were observed throwing rocks at the FPS officers and at one point, someone in the crowd threw a flaming object onto the roof of the ICE building. Due to the criminal acts, FPS officers moved the crowd back towards Elizabeth Caruthers Park.
Later, the crowd again began marching towards the ICE building, blocking the streets. The PPB incident commander declared the event an unlawful assembly and the crowd was given multiple warnings over a loudspeaker to leave the area or face possible arrest, use of crowd control munitions to include tear gas. The crowd did not leave the area, but remained in the middle of the street. A PPB officer assigned to the Rapid Response Team, deputized as a U.S. Marshal to protect federal personnel and property during civil disorder events, observed a subject later identified as Skyler Roy Rider, holding a distinct blue and white umbrella, in a line of others blocking the street holding shields. The PPB officer determined there was probable cause to arrest Rider for disorderly conduct and interfering with a peace officer. As the officer approached Rider to arrest him, Rider lowered the umbrella with both hands and forcibly jabbed the officer in the chest with the pointed end of the umbrella. The force caused the officer to gasp and curl over in pain. Rider ran from the officer and other officers came to assist and placed Rider into custody for assaulting a public safety officer.
Following the arrest of Rider, he was found to be dressed in all black wearing a gas mask and body armor. In his pockets were two water bottles. Video was later viewed by the PPB officer showing Rider throwing a water bottle at FPS officers earlier in the evening.
Skyler Roy Rider, made an initial appearance in federal court today before a U.S. Magistrate Judge Jolie Russo, was arraigned, pleaded not guilty, and ordered released pending a two-day jury trial scheduled to begin on December 29, 2020.
The Portland Police Bureau and the FBI investigated this case. It is being prosecuted by Assistant U.S. Attorneys for the District of Oregon.
An indictment is only an accusation of a crime, and a defendant is presumed innocent unless and until proven guilty.
Description: The fiscal year of the data file obtained from the AOUSC
Format: YYYY
Description: The code of the federal judicial circuit where the case was located
Format: A2
Description: The code of the federal judicial district where the case was located
Format: A2
Description: The code of the district office where the case was located
Format: A2
Description: Docket number assigned by the district to the case
Format: A7
Description: A unique number assigned to each defendant in a case which cannot be modified by the court
Format: A3
Description: A unique number assigned to each defendant in a case which can be modified by the court
Format: A3
Description: A sequential number indicating whether a case is an original proceeding or a reopen
Format: N5
Description: Case type associated with the current defendant record
Format: A2
Description: A concatenation of district, office, docket number, case type, defendant number, and reopen sequence number
Format: A18
Description: A concatenation of district, office, docket number, case type, and reopen sequence number
Format: A15
Description: The status of the defendant as assigned by the AOUSC
Format: A2
Description: A code indicating the fugitive status of a defendant
Format: A1
Description: The date upon which a defendant became a fugitive
Format: YYYYMMDD
Description: The date upon which a fugitive defendant was taken into custody
Format: YYYYMMDD
Description: The date when a case was first docketed in the district court
Format: YYYYMMDD
Description: The date upon which proceedings in a case commenced on charges pending in the district court where the defendant appeared, or the date of the defendant’s felony-waiver of indictment
Format: YYYYMMDD
Description: A code used to identify the nature of the proceeding
Format: N2
Description: The date when a defendant first appeared before a judicial officer in the district court where a charge was pending
Format: YYYYMMDD
Description: A code indicating the event by which a defendant appeared before a judicial officer in the district court where a charge was pending
Format: A2
Description: A code indicating the type of legal counsel assigned to a defendant
Format: N2
Description: The title and section of the U.S. Code applicable to the offense committed which carried the highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE1
Format: N2
Description: The four digit AO offense code associated with FTITLE1
Format: A4
Description: The four digit D2 offense code associated with FTITLE1
Format: A4
Description: A code indicating the severity associated with FTITLE1
Format: A3
Description: The title and section of the U.S. Code applicable to the offense committed which carried the second highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE2
Format: N2
Description: The four digit AO offense code associated with FTITLE2
Format: A4
Description: The four digit D2 offense code associated with FTITLE2
Format: A4
Description: A code indicating the severity associated with FTITLE2
Format: A3
Description: The FIPS code used to indicate the county or parish where an offense was committed
Format: A5
Description: The date of the last action taken on the record
Format: YYYYMMDD
Description: The date upon which judicial proceedings before the court concluded
Format: YYYYMMDD
Description: The date upon which the final sentence is recorded on the docket
Format: YYYYMMDD
Description: The date upon which the case was closed
Format: YYYYMMDD
Description: The total fine imposed at sentencing for all offenses of which the defendant was convicted and a fine was imposed
Format: N8
Description: A count of defendants filed including inter-district transfers
Format: N1
Description: A count of defendants filed excluding inter-district transfers
Format: N1
Description: A count of original proceedings commenced
Format: N1
Description: A count of defendants filed whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants terminated including interdistrict transfers
Format: N1
Description: A count of defendants terminated excluding interdistrict transfers
Format: N1
Description: A count of original proceedings terminated
Format: N1
Description: A count of defendants terminated whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants pending as of the last day of the period including long term fugitives
Format: N1
Description: A count of defendants pending as of the last day of the period excluding long term fugitives
Format: N1
Description: The source from which the data were loaded into the AOUSC’s NewSTATS database
Format: A10
Description: A sequential number indicating the iteration of the defendant record
Format: N2
Description: The date the record was loaded into the AOUSC’s NewSTATS database
Format: YYYYMMDD
Description: Statistical year ID label on data file obtained from the AOUSC which represents termination year
Description: The fiscal year of the data file obtained from the AOUSC
Format: YYYY
Description: The code of the federal judicial circuit where the case was located
Format: A2
Description: The code of the federal judicial district where the case was located
Format: A2
Description: The code of the district office where the case was located
Format: A2
Description: Docket number assigned by the district to the case
Format: A7
Description: A unique number assigned to each defendant in a case which cannot be modified by the court
Format: A3
Description: A unique number assigned to each defendant in a case which can be modified by the court
Format: A3
Description: A sequential number indicating whether a case is an original proceeding or a reopen
Format: N5
Description: Case type associated with the current defendant record
Format: A2
Description: Case type associated with a magistrate case if the current case was merged from a magistrate case
Format: A2
Description: A concatenation of district, office, docket number, case type, defendant number, and reopen sequence number
Format: A18
Description: A concatenation of district, office, docket number, case type, and reopen sequence number
Format: A15
Description: The docket number originally given to a case assigned to a magistrate judge and subsequently merged into a criminal case
Format: A7
Description: A unique number assigned to each defendant in a magistrate case
Format: A3
Description: The status of the defendant as assigned by the AOUSC
Format: A2
Description: A code indicating the fugitive status of a defendant
Format: A1
Description: The date upon which a defendant became a fugitive
Format: YYYYMMDD
Description: The date upon which a fugitive defendant was taken into custody
Format: YYYYMMDD
Description: The date when a case was first docketed in the district court
Format: YYYYMMDD
Description: The date upon which proceedings in a case commenced on charges pending in the district court where the defendant appeared, or the date of the defendant’s felony-waiver of indictment
Format: YYYYMMDD
Description: A code used to identify the nature of the proceeding
Format: N2
Description: The date when a defendant first appeared before a judicial officer in the district court where a charge was pending
Format: YYYYMMDD
Description: A code indicating the event by which a defendant appeared before a judicial officer in the district court where a charge was pending
Format: A2
Description: A code indicating the type of legal counsel assigned to a defendant
Format: N2
Description: The title and section of the U.S. Code applicable to the offense committed which carried the highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE1
Format: N2
Description: The four digit AO offense code associated with FTITLE1
Format: A4
Description: The four digit D2 offense code associated with FTITLE1
Format: A4
Description: A code indicating the severity associated with FTITLE1
Format: A3
Description: The FIPS code used to indicate the county or parish where an offense was committed
Format: A5
Description: The date of the last action taken on the record
Format: YYYYMMDD
Description: The date upon which judicial proceedings before the court concluded
Format: YYYYMMDD
Description: The date upon which the final sentence is recorded on the docket
Format: YYYYMMDD
Description: The date upon which the case was closed
Format: YYYYMMDD
Description: The total fine imposed at sentencing for all offenses of which the defendant was convicted and a fine was imposed
Format: N8
Description: A count of defendants filed including inter-district transfers
Format: N1
Description: A count of defendants filed excluding inter-district transfers
Format: N1
Description: A count of original proceedings commenced
Format: N1
Description: A count of defendants filed whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants terminated including interdistrict transfers
Format: N1
Description: A count of defendants terminated excluding interdistrict transfers
Format: N1
Description: A count of original proceedings terminated
Format: N1
Description: A count of defendants terminated whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants pending as of the last day of the period including long term fugitives
Format: N1
Description: A count of defendants pending as of the last day of the period excluding long term fugitives
Format: N1
Description: The source from which the data were loaded into the AOUSC’s NewSTATS database
Format: A10
Description: A sequential number indicating the iteration of the defendant record
Format: N2
Description: The date the record was loaded into the AOUSC’s NewSTATS database
Format: YYYYMMDD
Description: Statistical year ID label on data file obtained from the AOUSC which represents termination year
Description: The fiscal year of the data file obtained from the AOUSC
Format: YYYY
Description: The code of the federal judicial circuit where the case was located
Format: A2
Description: The code of the federal judicial district where the case was located
Format: A2
Description: The code of the district office where the case was located
Format: A2
Description: Docket number assigned by the district to the case
Format: A7
Description: A unique number assigned to each defendant in a case which cannot be modified by the court
Format: A3
Description: A unique number assigned to each defendant in a case which can be modified by the court
Format: A3
Description: A sequential number indicating whether a case is an original proceeding or a reopen
Format: N5
Description: Case type associated with the current defendant record
Format: A2
Description: Case type associated with a magistrate case if the current case was merged from a magistrate case
Format: A2
Description: A concatenation of district, office, docket number, case type, defendant number, and reopen sequence number
Format: A18
Description: A concatenation of district, office, docket number, case type, and reopen sequence number
Format: A15
Description: The docket number originally given to a case assigned to a magistrate judge and subsequently merged into a criminal case
Format: A7
Description: A unique number assigned to each defendant in a magistrate case
Format: A3
Description: The status of the defendant as assigned by the AOUSC
Format: A2
Description: A code indicating the fugitive status of a defendant
Format: A1
Description: The date upon which a defendant became a fugitive
Format: YYYYMMDD
Description: The date upon which a fugitive defendant was taken into custody
Format: YYYYMMDD
Description: The date when a case was first docketed in the district court
Format: YYYYMMDD
Description: The date upon which proceedings in a case commenced on charges pending in the district court where the defendant appeared, or the date of the defendant’s felony-waiver of indictment
Format: YYYYMMDD
Description: A code used to identify the nature of the proceeding
Format: N2
Description: The date when a defendant first appeared before a judicial officer in the district court where a charge was pending
Format: YYYYMMDD
Description: A code indicating the event by which a defendant appeared before a judicial officer in the district court where a charge was pending
Format: A2
Description: A code indicating the type of legal counsel assigned to a defendant
Format: N2
Description: The title and section of the U.S. Code applicable to the offense committed which carried the highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE1
Format: N2
Description: The four digit AO offense code associated with FTITLE1
Format: A4
Description: The four digit D2 offense code associated with FTITLE1
Format: A4
Description: A code indicating the severity associated with FTITLE1
Format: A3
Description: The FIPS code used to indicate the county or parish where an offense was committed
Format: A5
Description: The date of the last action taken on the record
Format: YYYYMMDD
Description: The date upon which judicial proceedings before the court concluded
Format: YYYYMMDD
Description: The date upon which the final sentence is recorded on the docket
Format: YYYYMMDD
Description: The date upon which the case was closed
Format: YYYYMMDD
Description: The total fine imposed at sentencing for all offenses of which the defendant was convicted and a fine was imposed
Format: N8
Description: A count of defendants filed including inter-district transfers
Format: N1
Description: A count of defendants filed excluding inter-district transfers
Format: N1
Description: A count of original proceedings commenced
Format: N1
Description: A count of defendants filed whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants terminated including interdistrict transfers
Format: N1
Description: A count of defendants terminated excluding interdistrict transfers
Format: N1
Description: A count of original proceedings terminated
Format: N1
Description: A count of defendants terminated whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants pending as of the last day of the period including long term fugitives
Format: N1
Description: A count of defendants pending as of the last day of the period excluding long term fugitives
Format: N1
Description: The source from which the data were loaded into the AOUSC’s NewSTATS database
Format: A10
Description: A sequential number indicating the iteration of the defendant record
Format: N2
Description: The date the record was loaded into the AOUSC’s NewSTATS database
Format: YYYYMMDD
Description: Statistical year ID label on data file obtained from the AOUSC which represents termination year
SPRINGFIELD, Ill. – An Adams county, Ill., man, Skyler M. Durbin, 24, of Payson, appeared today before U.S. Magistrate Judge Tom Schanzle-Haskins for arraignment on child pornography charges. An initial trial date was set for June 4, 2019, before U.S. District Judge Sue E. Myerscough. Durbin was ordered to remain in the custody of the U.S. Marshals Service.
A four-count indictment alleges that on Dec. 26, 2018, and on Jan 31, 2019, Durbin received and distributed images of child pornography (two counts) and that he possessed images of child pornography (two counts.)
If convicted, for each count of receipt and distribution of child pornography, Durbin faces a statutory penalty of a minimum 15 years to 40 years in prison. For possession of child pornography, Durbin faces statutory penalties of 10 to 20 years in prison.
The case is being prosecuted by Assistant U.S. Attorney Victor Yanz. The charges are the result of an investigation by the Adams County Sheriff’s Office and the Illinois Attorney General’s Office Internet Crimes Against Children Task Force, in cooperation with the Adams County State’s Attorney’s Office.
Members of the public are reminded that an indictment is merely an accusation; the defendant is presumed innocent unless proven guilty.
The case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Description: The fiscal year of the data file obtained from the AOUSC
Format: YYYY
Description: The code of the federal judicial circuit where the case was located
Format: A2
Description: The code of the federal judicial district where the case was located
Format: A2
Description: The code of the district office where the case was located
Format: A2
Description: Docket number assigned by the district to the case
Format: A7
Description: A unique number assigned to each defendant in a case which cannot be modified by the court
Format: A3
Description: A unique number assigned to each defendant in a case which can be modified by the court
Format: A3
Description: A sequential number indicating whether a case is an original proceeding or a reopen
Format: N5
Description: Case type associated with the current defendant record
Format: A2
Description: A concatenation of district, office, docket number, case type, defendant number, and reopen sequence number
Format: A18
Description: A concatenation of district, office, docket number, case type, and reopen sequence number
Format: A15
Description: The status of the defendant as assigned by the AOUSC
Format: A2
Description: A code indicating the fugitive status of a defendant
Format: A1
Description: The date upon which a defendant became a fugitive
Format: YYYYMMDD
Description: The date upon which a fugitive defendant was taken into custody
Format: YYYYMMDD
Description: The date when a case was first docketed in the district court
Format: YYYYMMDD
Description: The date upon which proceedings in a case commenced on charges pending in the district court where the defendant appeared, or the date of the defendant’s felony-waiver of indictment
Format: YYYYMMDD
Description: A code used to identify the nature of the proceeding
Format: N2
Description: The date when a defendant first appeared before a judicial officer in the district court where a charge was pending
Format: YYYYMMDD
Description: A code indicating the event by which a defendant appeared before a judicial officer in the district court where a charge was pending
Format: A2
Description: A code indicating the type of legal counsel assigned to a defendant
Format: N2
Description: The title and section of the U.S. Code applicable to the offense committed which carried the highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE1
Format: N2
Description: The four digit AO offense code associated with FTITLE1
Format: A4
Description: The four digit D2 offense code associated with FTITLE1
Format: A4
Description: A code indicating the severity associated with FTITLE1
Format: A3
Description: The title and section of the U.S. Code applicable to the offense committed which carried the second highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE2
Format: N2
Description: The four digit AO offense code associated with FTITLE2
Format: A4
Description: The four digit D2 offense code associated with FTITLE2
Format: A4
Description: A code indicating the severity associated with FTITLE2
Format: A3
Description: The title and section of the U.S. Code applicable to the offense committed which carried the third highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE3
Format: N2
Description: The four digit AO offense code associated with FTITLE3
Format: A4
Description: The four digit D2 offense code associated with FTITLE3
Format: A4
Description: A code indicating the severity associated with FTITLE3
Format: A3
Description: The title and section of the U.S. Code applicable to the offense committed which carried the fourth highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE4
Format: N2
Description: The four digit AO offense code associated with FTITLE4
Format: A4
Description: The four digit D2 offense code associated with FTITLE4
Format: A4
Description: A code indicating the severity associated with FTITLE4
Format: A3
Description: The FIPS code used to indicate the county or parish where an offense was committed
Format: A5
Description: The date of the last action taken on the record
Format: YYYYMMDD
Description: The date upon which judicial proceedings before the court concluded
Format: YYYYMMDD
Description: The date upon which the final sentence is recorded on the docket
Format: YYYYMMDD
Description: The date upon which the case was closed
Format: YYYYMMDD
Description: The total fine imposed at sentencing for all offenses of which the defendant was convicted and a fine was imposed
Format: N8
Description: A count of defendants filed including inter-district transfers
Format: N1
Description: A count of defendants filed excluding inter-district transfers
Format: N1
Description: A count of original proceedings commenced
Format: N1
Description: A count of defendants filed whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants terminated including interdistrict transfers
Format: N1
Description: A count of defendants terminated excluding interdistrict transfers
Format: N1
Description: A count of original proceedings terminated
Format: N1
Description: A count of defendants terminated whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants pending as of the last day of the period including long term fugitives
Format: N1
Description: A count of defendants pending as of the last day of the period excluding long term fugitives
Format: N1
Description: The source from which the data were loaded into the AOUSC’s NewSTATS database
Format: A10
Description: A sequential number indicating the iteration of the defendant record
Format: N2
Description: The date the record was loaded into the AOUSC’s NewSTATS database
Format: YYYYMMDD
Description: Statistical year ID label on data file obtained from the AOUSC which represents termination year
NEWARK, N.J. – A civilian employee of Picatinny Arsenal (PICA) and an employee of a defense contractor today admitted their roles in conspiring with others to receive bribes and other gratuities in return for assistance with the awarding of government contracts, U.S. Attorney Craig Carpenito announced.
Robert Dombroski, 64, of Branchville, New Jersey, a high ranking civilian employee at PICA, pleaded guilty before U.S. District Judge John Vazquez in Newark federal court to an information charging him with conspiring to commit wire fraud in order to accept or receive things of value in return for favorable assistance with government contracts and with making false claims against the United States.
Indra Nayee, 53, of Metuchen, New Jersey, pleaded guilty before Judge Vazquez to an information charging him with conspiring to give, offer or promise anything of value to a public official and to make false claims against the United States.
According to documents filed in this case and statements made in court:
Dombroksi worked at PICA, a U.S. Army installation in Morris County, New Jersey, for more than 30 years. PICA conducts research, development, acquisition and lifecycle management of advanced conventional weapons systems and advanced ammunitions and provides products and services to all branches of the U.S. military. Dombroski admitted that from at least January 2010 through December 2017, he conspired with other employees at PICA, with Subsystems Technology (STI) – a defense contracting firm that works with PICA and specializes in advanced engineering, advanced analytics, management consulting and IT services, including cyber-security – and employees of STI. He conspired to seek and accept gifts and other items of value, such as Apple products, luxury handbags, Beats headphones, and tickets to a luxury sky box at professional sporting events, valued at least $150,000 to $250,000, from STI in exchange for assistance in obtaining and retaining government contracts and other favorable assistance at PICA. He also admitted that in order to cover up his crimes, he filed false statements to the Department of Defense by failing to list the items of value he received from STI on his annual confidential financial disclosure form known as an OGE Form 450.
Nayee, an employee of STI, admitted that from January 2012 through December 2016, he conspired with STI and other employees of STI to offer gifts and other items of value to numerous individuals employed at PICA in order to obtain and retain contracts and other favorable assistance at PICA. He also admitted that he and other employees at STI, and the company, submitted false bills to the United States writing off the cost of the bribes as “materials” needed on United States government contracts, when in fact the gifts and other items of value were for the personal use and enjoyment of the employees at PICA and not for any legitimate government purpose.
The conspiracy charge to which Dombroski and Nayee pleaded guilty carries a maximum potential penalty of five years in prison and a maximum fine of $250,000 or twice the gross gain or loss associated with the offense, whichever is greatest. Sentencing for Dombroski is scheduled for Nov. 19, 2019, and sentencing for Nayee is scheduled for Dec. 16, 2019.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark; the U.S. Department of Defense, Defense Criminal Investigative Service, under the direction of Leigh-Alistair Barzey, Special Agent in Charge, DCIS Northeast Field Office; and the U.S. Army, Major Procurement Fraud Unit, Criminal Investigation Command, under the direction of Special Agent in Charge L. Scott Moreland, with the investigation leading to today’s guilty pleas.
The government is represented by Senior Trial Counsel Margaret Ann Mahoney of the U.S. Attorney’s Office’s National Security Unit in Newark.
NEWARK, N.J. – A former civilian employee at Picatinny Arsenal and a former official of a defense contractor with a branch office in Lake Hopatcong, New Jersey, have been charged with conspiracy to commit wire fraud, U.S. Attorney Craig Carpenito announced today.
Robert Dombroski, 63, of Branchville, New Jersey, is charged by complaint with one count of conspiracy to commit wire fraud and four counts of making false statements. Indra Nayee, 51, of Metuchen, New Jersey, is also charged by complaint with one count of conspiracy to commit wire fraud. Both men are scheduled to appear this afternoon before U.S. Magistrate Judge Mark Falk in Newark federal court.
According to documents filed in this case and statements made in court:
Dombroski worked at Picatinny Arsenal for over 30 years, retiring as a federal employee in 2015. He was then hired as a civilian, serving as a Senior Products Manager for advanced weapons. Prior to retiring, Dombroski held the position of senior associate for advanced weapons and worked on and supervised contract projects with a defense contractor, identified in court papers as “Company A,” which is headquartered in Arlington, Virginia, and has a branch office in Lake Hopatcong, New Jersey. In that capacity, Dombroski had influence over the awarding of government contracts to this company and influenced how the money was allocated.
Nayee was the former Picatinny Arsenal division director of Company A, and had direct oversight and control over how his company executed the government contracts it had with Picatinny Arsenal. He supervised and directly managed all branch employees. Nayee was the primary point of contact at Company A for Picatinny Arsenal employees, including Dombrowski.
From 2010 through 2018, Dombroski and Nayee conspired with other federal employees at Picatinny Arsenal and employees of Company A to seek and accept gifts and other items of value, such as Apple products, luxury handbags, Beats headphones, and tickets to a luxury sky box at professional sporting events, valued at $150,000 to $250,000, in exchange for government contracts and other favorable assistance for Company A at Picatinny Arsenal.
The count of conspiracy to commit wire fraud carries a maximum penalty of 20 years in prison. The false statement charges each carry a maximum penalty of five years in prison.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark; the U.S. Department of Defense, Defense Criminal Investigative Service, under the direction of Special Agent in Charge Leigh-Alistair Barzey; and the U.S. Army, Major Procurement Fraud Unit, Criminal Investigation Command, under the direction of Special Agent in Charge L. Scott Moreland, with the ongoing investigation.
The government is represented by Senior Trial Counsel Margaret Ann Mahoney and Assistant U.S. Attorney Thomas S. Kearney of the U.S. Attorney’s Office’s National Security Unit in Newark.
The charges and allegations in the complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Description: The fiscal year of the data file obtained from the AOUSC
Format: YYYY
Description: The code of the federal judicial circuit where the case was located
Format: A2
Description: The code of the federal judicial district where the case was located
Format: A2
Description: The code of the district office where the case was located
Format: A2
Description: Docket number assigned by the district to the case
Format: A7
Description: A unique number assigned to each defendant in a case which cannot be modified by the court
Format: A3
Description: A unique number assigned to each defendant in a case which can be modified by the court
Format: A3
Description: A sequential number indicating whether a case is an original proceeding or a reopen
Format: N5
Description: Case type associated with the current defendant record
Format: A2
Description: Case type associated with a magistrate case if the current case was merged from a magistrate case
Format: A2
Description: A concatenation of district, office, docket number, case type, defendant number, and reopen sequence number
Format: A18
Description: A concatenation of district, office, docket number, case type, and reopen sequence number
Format: A15
Description: The docket number originally given to a case assigned to a magistrate judge and subsequently merged into a criminal case
Format: A7
Description: A unique number assigned to each defendant in a magistrate case
Format: A3
Description: The status of the defendant as assigned by the AOUSC
Format: A2
Description: A code indicating the fugitive status of a defendant
Format: A1
Description: The date upon which a defendant became a fugitive
Format: YYYYMMDD
Description: The date upon which a fugitive defendant was taken into custody
Format: YYYYMMDD
Description: The date when a case was first docketed in the district court
Format: YYYYMMDD
Description: The date upon which proceedings in a case commenced on charges pending in the district court where the defendant appeared, or the date of the defendant’s felony-waiver of indictment
Format: YYYYMMDD
Description: A code used to identify the nature of the proceeding
Format: N2
Description: The date when a defendant first appeared before a judicial officer in the district court where a charge was pending
Format: YYYYMMDD
Description: A code indicating the event by which a defendant appeared before a judicial officer in the district court where a charge was pending
Format: A2
Description: A code indicating the type of legal counsel assigned to a defendant
Format: N2
Description: The title and section of the U.S. Code applicable to the offense committed which carried the highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE1
Format: N2
Description: The four digit AO offense code associated with FTITLE1
Format: A4
Description: The four digit D2 offense code associated with FTITLE1
Format: A4
Description: A code indicating the severity associated with FTITLE1
Format: A3
Description: The title and section of the U.S. Code applicable to the offense committed which carried the second highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE2
Format: N2
Description: The four digit AO offense code associated with FTITLE2
Format: A4
Description: The four digit D2 offense code associated with FTITLE2
Format: A4
Description: A code indicating the severity associated with FTITLE2
Format: A3
Description: The title and section of the U.S. Code applicable to the offense committed which carried the third highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE3
Format: N2
Description: The four digit AO offense code associated with FTITLE3
Format: A4
Description: The four digit D2 offense code associated with FTITLE3
Format: A4
Description: A code indicating the severity associated with FTITLE3
Format: A3
Description: The title and section of the U.S. Code applicable to the offense committed which carried the fourth highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE4
Format: N2
Description: The four digit AO offense code associated with FTITLE4
Format: A4
Description: The four digit D2 offense code associated with FTITLE4
Format: A4
Description: A code indicating the severity associated with FTITLE4
Format: A3
Description: The title and section of the U.S. Code applicable to the offense committed which carried the fifth highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE5
Format: N2
Description: The four digit AO offense code associated with FTITLE5
Format: A4
Description: The four digit D2 offense code associated with FTITLE5
Format: A4
Description: A code indicating the severity associated with FTITLE5
Format: A3
Description: The FIPS code used to indicate the county or parish where an offense was committed
Format: A5
Description: The date of the last action taken on the record
Format: YYYYMMDD
Description: The date upon which judicial proceedings before the court concluded
Format: YYYYMMDD
Description: The date upon which the final sentence is recorded on the docket
Format: YYYYMMDD
Description: The date upon which the case was closed
Format: YYYYMMDD
Description: The total fine imposed at sentencing for all offenses of which the defendant was convicted and a fine was imposed
Format: N8
Description: A count of defendants filed including inter-district transfers
Format: N1
Description: A count of defendants filed excluding inter-district transfers
Format: N1
Description: A count of original proceedings commenced
Format: N1
Description: A count of defendants filed whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants terminated including interdistrict transfers
Format: N1
Description: A count of defendants terminated excluding interdistrict transfers
Format: N1
Description: A count of original proceedings terminated
Format: N1
Description: A count of defendants terminated whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants pending as of the last day of the period including long term fugitives
Format: N1
Description: A count of defendants pending as of the last day of the period excluding long term fugitives
Format: N1
Description: The source from which the data were loaded into the AOUSC’s NewSTATS database
Format: A10
Description: A sequential number indicating the iteration of the defendant record
Format: N2
Description: The date the record was loaded into the AOUSC’s NewSTATS database
Format: YYYYMMDD
Description: Statistical year ID label on data file obtained from the AOUSC which represents termination year
NEWARK, N.J. – A former civilian employee at Picatinny Arsenal and a former official of a defense contractor with a branch office in Lake Hopatcong, New Jersey, have been charged with conspiracy to commit wire fraud, U.S. Attorney Craig Carpenito announced today.
Robert Dombroski, 63, of Branchville, New Jersey, is charged by complaint with one count of conspiracy to commit wire fraud and four counts of making false statements. Indra Nayee, 51, of Metuchen, New Jersey, is also charged by complaint with one count of conspiracy to commit wire fraud. Both men are scheduled to appear this afternoon before U.S. Magistrate Judge Mark Falk in Newark federal court.
According to documents filed in this case and statements made in court:
Dombroski worked at Picatinny Arsenal for over 30 years, retiring as a federal employee in 2015. He was then hired as a civilian, serving as a Senior Products Manager for advanced weapons. Prior to retiring, Dombroski held the position of senior associate for advanced weapons and worked on and supervised contract projects with a defense contractor, identified in court papers as “Company A,” which is headquartered in Arlington, Virginia, and has a branch office in Lake Hopatcong, New Jersey. In that capacity, Dombroski had influence over the awarding of government contracts to this company and influenced how the money was allocated.
Nayee was the former Picatinny Arsenal division director of Company A, and had direct oversight and control over how his company executed the government contracts it had with Picatinny Arsenal. He supervised and directly managed all branch employees. Nayee was the primary point of contact at Company A for Picatinny Arsenal employees, including Dombrowski.
From 2010 through 2018, Dombroski and Nayee conspired with other federal employees at Picatinny Arsenal and employees of Company A to seek and accept gifts and other items of value, such as Apple products, luxury handbags, Beats headphones, and tickets to a luxury sky box at professional sporting events, valued at $150,000 to $250,000, in exchange for government contracts and other favorable assistance for Company A at Picatinny Arsenal.
The count of conspiracy to commit wire fraud carries a maximum penalty of 20 years in prison. The false statement charges each carry a maximum penalty of five years in prison.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark; the U.S. Department of Defense, Defense Criminal Investigative Service, under the direction of Special Agent in Charge Leigh-Alistair Barzey; and the U.S. Army, Major Procurement Fraud Unit, Criminal Investigation Command, under the direction of Special Agent in Charge L. Scott Moreland, with the ongoing investigation.
The government is represented by Senior Trial Counsel Margaret Ann Mahoney and Assistant U.S. Attorney Thomas S. Kearney of the U.S. Attorney’s Office’s National Security Unit in Newark.
The charges and allegations in the complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Description: The fiscal year of the data file obtained from the AOUSC
Format: YYYY
Description: The code of the federal judicial circuit where the case was located
Format: A2
Description: The code of the federal judicial district where the case was located
Format: A2
Description: The code of the district office where the case was located
Format: A2
Description: Docket number assigned by the district to the case
Format: A7
Description: A unique number assigned to each defendant in a case which cannot be modified by the court
Format: A3
Description: A unique number assigned to each defendant in a case which can be modified by the court
Format: A3
Description: A sequential number indicating whether a case is an original proceeding or a reopen
Format: N5
Description: Case type associated with the current defendant record
Format: A2
Description: Case type associated with a magistrate case if the current case was merged from a magistrate case
Format: A2
Description: A concatenation of district, office, docket number, case type, defendant number, and reopen sequence number
Format: A18
Description: A concatenation of district, office, docket number, case type, and reopen sequence number
Format: A15
Description: The docket number originally given to a case assigned to a magistrate judge and subsequently merged into a criminal case
Format: A7
Description: A unique number assigned to each defendant in a magistrate case
Format: A3
Description: The status of the defendant as assigned by the AOUSC
Format: A2
Description: A code indicating the fugitive status of a defendant
Format: A1
Description: The date upon which a defendant became a fugitive
Format: YYYYMMDD
Description: The date upon which a fugitive defendant was taken into custody
Format: YYYYMMDD
Description: The date when a case was first docketed in the district court
Format: YYYYMMDD
Description: The date upon which proceedings in a case commenced on charges pending in the district court where the defendant appeared, or the date of the defendant’s felony-waiver of indictment
Format: YYYYMMDD
Description: A code used to identify the nature of the proceeding
Format: N2
Description: The date when a defendant first appeared before a judicial officer in the district court where a charge was pending
Format: YYYYMMDD
Description: A code indicating the event by which a defendant appeared before a judicial officer in the district court where a charge was pending
Format: A2
Description: A code indicating the type of legal counsel assigned to a defendant
Format: N2
Description: The title and section of the U.S. Code applicable to the offense committed which carried the highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE1
Format: N2
Description: The four digit AO offense code associated with FTITLE1
Format: A4
Description: The four digit D2 offense code associated with FTITLE1
Format: A4
Description: A code indicating the severity associated with FTITLE1
Format: A3
Description: The title and section of the U.S. Code applicable to the offense committed which carried the second highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE2
Format: N2
Description: The four digit AO offense code associated with FTITLE2
Format: A4
Description: The four digit D2 offense code associated with FTITLE2
Format: A4
Description: A code indicating the severity associated with FTITLE2
Format: A3
Description: The title and section of the U.S. Code applicable to the offense committed which carried the third highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE3
Format: N2
Description: The four digit AO offense code associated with FTITLE3
Format: A4
Description: The four digit D2 offense code associated with FTITLE3
Format: A4
Description: A code indicating the severity associated with FTITLE3
Format: A3
Description: The title and section of the U.S. Code applicable to the offense committed which carried the fourth highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE4
Format: N2
Description: The four digit AO offense code associated with FTITLE4
Format: A4
Description: The four digit D2 offense code associated with FTITLE4
Format: A4
Description: A code indicating the severity associated with FTITLE4
Format: A3
Description: The title and section of the U.S. Code applicable to the offense committed which carried the fifth highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE5
Format: N2
Description: The four digit AO offense code associated with FTITLE5
Format: A4
Description: The four digit D2 offense code associated with FTITLE5
Format: A4
Description: A code indicating the severity associated with FTITLE5
Format: A3
Description: The FIPS code used to indicate the county or parish where an offense was committed
Format: A5
Description: The date of the last action taken on the record
Format: YYYYMMDD
Description: The date upon which judicial proceedings before the court concluded
Format: YYYYMMDD
Description: The date upon which the final sentence is recorded on the docket
Format: YYYYMMDD
Description: The date upon which the case was closed
Format: YYYYMMDD
Description: The total fine imposed at sentencing for all offenses of which the defendant was convicted and a fine was imposed
Format: N8
Description: A count of defendants filed including inter-district transfers
Format: N1
Description: A count of defendants filed excluding inter-district transfers
Format: N1
Description: A count of original proceedings commenced
Format: N1
Description: A count of defendants filed whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants terminated including interdistrict transfers
Format: N1
Description: A count of defendants terminated excluding interdistrict transfers
Format: N1
Description: A count of original proceedings terminated
Format: N1
Description: A count of defendants terminated whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants pending as of the last day of the period including long term fugitives
Format: N1
Description: A count of defendants pending as of the last day of the period excluding long term fugitives
Format: N1
Description: The source from which the data were loaded into the AOUSC’s NewSTATS database
Format: A10
Description: A sequential number indicating the iteration of the defendant record
Format: N2
Description: The date the record was loaded into the AOUSC’s NewSTATS database
Format: YYYYMMDD
Description: Statistical year ID label on data file obtained from the AOUSC which represents termination year
NEWARK, N.J. – A civilian employee of Picatinny Arsenal (PICA) and an employee of a defense contractor today admitted their roles in conspiring with others to receive bribes and other gratuities in return for assistance with the awarding of government contracts, U.S. Attorney Craig Carpenito announced.
Robert Dombroski, 64, of Branchville, New Jersey, a high ranking civilian employee at PICA, pleaded guilty before U.S. District Judge John Vazquez in Newark federal court to an information charging him with conspiring to commit wire fraud in order to accept or receive things of value in return for favorable assistance with government contracts and with making false claims against the United States.
Indra Nayee, 53, of Metuchen, New Jersey, pleaded guilty before Judge Vazquez to an information charging him with conspiring to give, offer or promise anything of value to a public official and to make false claims against the United States.
According to documents filed in this case and statements made in court:
Dombroksi worked at PICA, a U.S. Army installation in Morris County, New Jersey, for more than 30 years. PICA conducts research, development, acquisition and lifecycle management of advanced conventional weapons systems and advanced ammunitions and provides products and services to all branches of the U.S. military. Dombroski admitted that from at least January 2010 through December 2017, he conspired with other employees at PICA, with Subsystems Technology (STI) – a defense contracting firm that works with PICA and specializes in advanced engineering, advanced analytics, management consulting and IT services, including cyber-security – and employees of STI. He conspired to seek and accept gifts and other items of value, such as Apple products, luxury handbags, Beats headphones, and tickets to a luxury sky box at professional sporting events, valued at least $150,000 to $250,000, from STI in exchange for assistance in obtaining and retaining government contracts and other favorable assistance at PICA. He also admitted that in order to cover up his crimes, he filed false statements to the Department of Defense by failing to list the items of value he received from STI on his annual confidential financial disclosure form known as an OGE Form 450.
Nayee, an employee of STI, admitted that from January 2012 through December 2016, he conspired with STI and other employees of STI to offer gifts and other items of value to numerous individuals employed at PICA in order to obtain and retain contracts and other favorable assistance at PICA. He also admitted that he and other employees at STI, and the company, submitted false bills to the United States writing off the cost of the bribes as “materials” needed on United States government contracts, when in fact the gifts and other items of value were for the personal use and enjoyment of the employees at PICA and not for any legitimate government purpose.
The conspiracy charge to which Dombroski and Nayee pleaded guilty carries a maximum potential penalty of five years in prison and a maximum fine of $250,000 or twice the gross gain or loss associated with the offense, whichever is greatest. Sentencing for Dombroski is scheduled for Nov. 19, 2019, and sentencing for Nayee is scheduled for Dec. 16, 2019.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark; the U.S. Department of Defense, Defense Criminal Investigative Service, under the direction of Leigh-Alistair Barzey, Special Agent in Charge, DCIS Northeast Field Office; and the U.S. Army, Major Procurement Fraud Unit, Criminal Investigation Command, under the direction of Special Agent in Charge L. Scott Moreland, with the investigation leading to today’s guilty pleas.
The government is represented by Senior Trial Counsel Margaret Ann Mahoney of the U.S. Attorney’s Office’s National Security Unit in Newark.
NEWARK, N.J. – A former civilian employee at Picatinny Arsenal and a former official of a defense contractor with a branch office in Lake Hopatcong, New Jersey, have been charged with conspiracy to commit wire fraud, U.S. Attorney Craig Carpenito announced today.
Robert Dombroski, 63, of Branchville, New Jersey, is charged by complaint with one count of conspiracy to commit wire fraud and four counts of making false statements. Indra Nayee, 51, of Metuchen, New Jersey, is also charged by complaint with one count of conspiracy to commit wire fraud. Both men are scheduled to appear this afternoon before U.S. Magistrate Judge Mark Falk in Newark federal court.
According to documents filed in this case and statements made in court:
Dombroski worked at Picatinny Arsenal for over 30 years, retiring as a federal employee in 2015. He was then hired as a civilian, serving as a Senior Products Manager for advanced weapons. Prior to retiring, Dombroski held the position of senior associate for advanced weapons and worked on and supervised contract projects with a defense contractor, identified in court papers as “Company A,” which is headquartered in Arlington, Virginia, and has a branch office in Lake Hopatcong, New Jersey. In that capacity, Dombroski had influence over the awarding of government contracts to this company and influenced how the money was allocated.
Nayee was the former Picatinny Arsenal division director of Company A, and had direct oversight and control over how his company executed the government contracts it had with Picatinny Arsenal. He supervised and directly managed all branch employees. Nayee was the primary point of contact at Company A for Picatinny Arsenal employees, including Dombrowski.
From 2010 through 2018, Dombroski and Nayee conspired with other federal employees at Picatinny Arsenal and employees of Company A to seek and accept gifts and other items of value, such as Apple products, luxury handbags, Beats headphones, and tickets to a luxury sky box at professional sporting events, valued at $150,000 to $250,000, in exchange for government contracts and other favorable assistance for Company A at Picatinny Arsenal.
The count of conspiracy to commit wire fraud carries a maximum penalty of 20 years in prison. The false statement charges each carry a maximum penalty of five years in prison.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark; the U.S. Department of Defense, Defense Criminal Investigative Service, under the direction of Special Agent in Charge Leigh-Alistair Barzey; and the U.S. Army, Major Procurement Fraud Unit, Criminal Investigation Command, under the direction of Special Agent in Charge L. Scott Moreland, with the ongoing investigation.
The government is represented by Senior Trial Counsel Margaret Ann Mahoney and Assistant U.S. Attorney Thomas S. Kearney of the U.S. Attorney’s Office’s National Security Unit in Newark.
The charges and allegations in the complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Description: The fiscal year of the data file obtained from the AOUSC
Format: YYYY
Description: The code of the federal judicial circuit where the case was located
Format: A2
Description: The code of the federal judicial district where the case was located
Format: A2
Description: The code of the district office where the case was located
Format: A2
Description: Docket number assigned by the district to the case
Format: A7
Description: A unique number assigned to each defendant in a case which cannot be modified by the court
Format: A3
Description: A unique number assigned to each defendant in a case which can be modified by the court
Format: A3
Description: A sequential number indicating whether a case is an original proceeding or a reopen
Format: N5
Description: Case type associated with the current defendant record
Format: A2
Description: Case type associated with a magistrate case if the current case was merged from a magistrate case
Format: A2
Description: A concatenation of district, office, docket number, case type, defendant number, and reopen sequence number
Format: A18
Description: A concatenation of district, office, docket number, case type, and reopen sequence number
Format: A15
Description: The docket number originally given to a case assigned to a magistrate judge and subsequently merged into a criminal case
Format: A7
Description: A unique number assigned to each defendant in a magistrate case
Format: A3
Description: The status of the defendant as assigned by the AOUSC
Format: A2
Description: A code indicating the fugitive status of a defendant
Format: A1
Description: The date upon which a defendant became a fugitive
Format: YYYYMMDD
Description: The date upon which a fugitive defendant was taken into custody
Format: YYYYMMDD
Description: The date when a case was first docketed in the district court
Format: YYYYMMDD
Description: The date upon which proceedings in a case commenced on charges pending in the district court where the defendant appeared, or the date of the defendant’s felony-waiver of indictment
Format: YYYYMMDD
Description: A code used to identify the nature of the proceeding
Format: N2
Description: The date when a defendant first appeared before a judicial officer in the district court where a charge was pending
Format: YYYYMMDD
Description: A code indicating the event by which a defendant appeared before a judicial officer in the district court where a charge was pending
Format: A2
Description: A code indicating the type of legal counsel assigned to a defendant
Format: N2
Description: The title and section of the U.S. Code applicable to the offense committed which carried the highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE1
Format: N2
Description: The four digit AO offense code associated with FTITLE1
Format: A4
Description: The four digit D2 offense code associated with FTITLE1
Format: A4
Description: A code indicating the severity associated with FTITLE1
Format: A3
Description: The FIPS code used to indicate the county or parish where an offense was committed
Format: A5
Description: The date of the last action taken on the record
Format: YYYYMMDD
Description: The date upon which judicial proceedings before the court concluded
Format: YYYYMMDD
Description: The date upon which the final sentence is recorded on the docket
Format: YYYYMMDD
Description: The date upon which the case was closed
Format: YYYYMMDD
Description: The total fine imposed at sentencing for all offenses of which the defendant was convicted and a fine was imposed
Format: N8
Description: A count of defendants filed including inter-district transfers
Format: N1
Description: A count of defendants filed excluding inter-district transfers
Format: N1
Description: A count of original proceedings commenced
Format: N1
Description: A count of defendants filed whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants terminated including interdistrict transfers
Format: N1
Description: A count of defendants terminated excluding interdistrict transfers
Format: N1
Description: A count of original proceedings terminated
Format: N1
Description: A count of defendants terminated whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants pending as of the last day of the period including long term fugitives
Format: N1
Description: A count of defendants pending as of the last day of the period excluding long term fugitives
Format: N1
Description: The source from which the data were loaded into the AOUSC’s NewSTATS database
Format: A10
Description: A sequential number indicating the iteration of the defendant record
Format: N2
Description: The date the record was loaded into the AOUSC’s NewSTATS database
Format: YYYYMMDD
Description: Statistical year ID label on data file obtained from the AOUSC which represents termination year
NEWARK, N.J. – A former civilian employee at Picatinny Arsenal and a former official of a defense contractor with a branch office in Lake Hopatcong, New Jersey, have been charged with conspiracy to commit wire fraud, U.S. Attorney Craig Carpenito announced today.
Robert Dombroski, 63, of Branchville, New Jersey, is charged by complaint with one count of conspiracy to commit wire fraud and four counts of making false statements. Indra Nayee, 51, of Metuchen, New Jersey, is also charged by complaint with one count of conspiracy to commit wire fraud. Both men are scheduled to appear this afternoon before U.S. Magistrate Judge Mark Falk in Newark federal court.
According to documents filed in this case and statements made in court:
Dombroski worked at Picatinny Arsenal for over 30 years, retiring as a federal employee in 2015. He was then hired as a civilian, serving as a Senior Products Manager for advanced weapons. Prior to retiring, Dombroski held the position of senior associate for advanced weapons and worked on and supervised contract projects with a defense contractor, identified in court papers as “Company A,” which is headquartered in Arlington, Virginia, and has a branch office in Lake Hopatcong, New Jersey. In that capacity, Dombroski had influence over the awarding of government contracts to this company and influenced how the money was allocated.
Nayee was the former Picatinny Arsenal division director of Company A, and had direct oversight and control over how his company executed the government contracts it had with Picatinny Arsenal. He supervised and directly managed all branch employees. Nayee was the primary point of contact at Company A for Picatinny Arsenal employees, including Dombrowski.
From 2010 through 2018, Dombroski and Nayee conspired with other federal employees at Picatinny Arsenal and employees of Company A to seek and accept gifts and other items of value, such as Apple products, luxury handbags, Beats headphones, and tickets to a luxury sky box at professional sporting events, valued at $150,000 to $250,000, in exchange for government contracts and other favorable assistance for Company A at Picatinny Arsenal.
The count of conspiracy to commit wire fraud carries a maximum penalty of 20 years in prison. The false statement charges each carry a maximum penalty of five years in prison.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark; the U.S. Department of Defense, Defense Criminal Investigative Service, under the direction of Special Agent in Charge Leigh-Alistair Barzey; and the U.S. Army, Major Procurement Fraud Unit, Criminal Investigation Command, under the direction of Special Agent in Charge L. Scott Moreland, with the ongoing investigation.
The government is represented by Senior Trial Counsel Margaret Ann Mahoney and Assistant U.S. Attorney Thomas S. Kearney of the U.S. Attorney’s Office’s National Security Unit in Newark.
The charges and allegations in the complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Description: The fiscal year of the data file obtained from the AOUSC
Format: YYYY
Description: The code of the federal judicial circuit where the case was located
Format: A2
Description: The code of the federal judicial district where the case was located
Format: A2
Description: The code of the district office where the case was located
Format: A2
Description: Docket number assigned by the district to the case
Format: A7
Description: A unique number assigned to each defendant in a case which cannot be modified by the court
Format: A3
Description: A unique number assigned to each defendant in a case which can be modified by the court
Format: A3
Description: A sequential number indicating whether a case is an original proceeding or a reopen
Format: N5
Description: Case type associated with the current defendant record
Format: A2
Description: Case type associated with a magistrate case if the current case was merged from a magistrate case
Format: A2
Description: A concatenation of district, office, docket number, case type, defendant number, and reopen sequence number
Format: A18
Description: A concatenation of district, office, docket number, case type, and reopen sequence number
Format: A15
Description: The docket number originally given to a case assigned to a magistrate judge and subsequently merged into a criminal case
Format: A7
Description: A unique number assigned to each defendant in a magistrate case
Format: A3
Description: The status of the defendant as assigned by the AOUSC
Format: A2
Description: A code indicating the fugitive status of a defendant
Format: A1
Description: The date upon which a defendant became a fugitive
Format: YYYYMMDD
Description: The date upon which a fugitive defendant was taken into custody
Format: YYYYMMDD
Description: The date when a case was first docketed in the district court
Format: YYYYMMDD
Description: The date upon which proceedings in a case commenced on charges pending in the district court where the defendant appeared, or the date of the defendant’s felony-waiver of indictment
Format: YYYYMMDD
Description: A code used to identify the nature of the proceeding
Format: N2
Description: The date when a defendant first appeared before a judicial officer in the district court where a charge was pending
Format: YYYYMMDD
Description: A code indicating the event by which a defendant appeared before a judicial officer in the district court where a charge was pending
Format: A2
Description: A code indicating the type of legal counsel assigned to a defendant
Format: N2
Description: The title and section of the U.S. Code applicable to the offense committed which carried the highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE1
Format: N2
Description: The four digit AO offense code associated with FTITLE1
Format: A4
Description: The four digit D2 offense code associated with FTITLE1
Format: A4
Description: A code indicating the severity associated with FTITLE1
Format: A3
Description: The title and section of the U.S. Code applicable to the offense committed which carried the second highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE2
Format: N2
Description: The four digit AO offense code associated with FTITLE2
Format: A4
Description: The four digit D2 offense code associated with FTITLE2
Format: A4
Description: A code indicating the severity associated with FTITLE2
Format: A3
Description: The title and section of the U.S. Code applicable to the offense committed which carried the third highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE3
Format: N2
Description: The four digit AO offense code associated with FTITLE3
Format: A4
Description: The four digit D2 offense code associated with FTITLE3
Format: A4
Description: A code indicating the severity associated with FTITLE3
Format: A3
Description: The title and section of the U.S. Code applicable to the offense committed which carried the fourth highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE4
Format: N2
Description: The four digit AO offense code associated with FTITLE4
Format: A4
Description: The four digit D2 offense code associated with FTITLE4
Format: A4
Description: A code indicating the severity associated with FTITLE4
Format: A3
Description: The title and section of the U.S. Code applicable to the offense committed which carried the fifth highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE5
Format: N2
Description: The four digit AO offense code associated with FTITLE5
Format: A4
Description: The four digit D2 offense code associated with FTITLE5
Format: A4
Description: A code indicating the severity associated with FTITLE5
Format: A3
Description: The FIPS code used to indicate the county or parish where an offense was committed
Format: A5
Description: The date of the last action taken on the record
Format: YYYYMMDD
Description: The date upon which judicial proceedings before the court concluded
Format: YYYYMMDD
Description: The date upon which the final sentence is recorded on the docket
Format: YYYYMMDD
Description: The date upon which the case was closed
Format: YYYYMMDD
Description: The total fine imposed at sentencing for all offenses of which the defendant was convicted and a fine was imposed
Format: N8
Description: A count of defendants filed including inter-district transfers
Format: N1
Description: A count of defendants filed excluding inter-district transfers
Format: N1
Description: A count of original proceedings commenced
Format: N1
Description: A count of defendants filed whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants terminated including interdistrict transfers
Format: N1
Description: A count of defendants terminated excluding interdistrict transfers
Format: N1
Description: A count of original proceedings terminated
Format: N1
Description: A count of defendants terminated whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants pending as of the last day of the period including long term fugitives
Format: N1
Description: A count of defendants pending as of the last day of the period excluding long term fugitives
Format: N1
Description: The source from which the data were loaded into the AOUSC’s NewSTATS database
Format: A10
Description: A sequential number indicating the iteration of the defendant record
Format: N2
Description: The date the record was loaded into the AOUSC’s NewSTATS database
Format: YYYYMMDD
Description: Statistical year ID label on data file obtained from the AOUSC which represents termination year
NEWARK, N.J. – Two Sussex County, New Jersey, women, one a defense contractor employee and the other a civilian employee at Picatinny Arsenal, today admitted their roles in a scheme that traded bribes and other gratuities for favorable treatment on government contracts, U.S. Attorney Craig Carpenito announced.
Irene Pombo, 68, of Hamburg, New Jersey, and her daughter, Nicole Pier, 38, of Byram Township, New Jersey, pleaded guilty before U.S. District Judge John Vazquez in Newark federal court to separate informations charging them with conspiracy to give or accept anything of value in return for favorable assistance with government contracts and with making false claims against the United States.
According to documents filed in this case and statements made in court:
Pombo was an employee of an entity referred to in the information as “Company A,” a defense contracting firm that works with the Department of Defense at Picatinny Arsenal, a U.S. Army installation in Morris County, New Jersey. Pier was a civilian employee at Picatinny Arsenal.
From January 2006 through December 2017, Company A, Pombo, and other Company A employees conspired to offer a variety of valuable gifts, including Apple products, luxury handbags, Beats headphones, and tickets to a luxury sky box at professional sporting events, valued at least $150,000 to $250,000, to numerous individuals employed at Picatinny Arsenal, including Pier, in order to obtain and retain contracts and other favorable assistance.
Pombo admitted that she and other Company A employees filed false bills to the United States writing off the cost of the bribes as “materials” needed on government contracts.
The conspiracy charge to which Pombo and Pier pleaded guilty carries a maximum potential penalty of five years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. Sentencing for both defendants is scheduled for June 19, 2018.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Acting Special Agent in Charge Bradley W. Cohen in Newark; the U.S. Department of Defense, Defense Criminal Investigative Service, under the direction of Special Agent in Charge Leigh-Alistair Barzey, and the U.S. Army, Major Procurement Fraud Unit, Criminal Investigation Command, under the direction of Special Agent in Charge L. Scott Moreland, with the ongoing investigation.
The government is represented by Senior Litigation Counsel Margaret Ann Mahoney of the U.S. Attorney’s Office’s National Security Unit in Newark.
NEWARK, N.J. – A civilian employee at Picatinny Arsenal today admitted his role in a scheme that traded bribes and other gratuities for favorable treatment on government contracts, U.S. Attorney Craig Carpenito announced.
Joseph Gooch, 60, of Morristown, New Jersey, pleaded guilty before U.S. District Judge John Vazquez in Newark federal court to an information charging him with accepting or receiving things of value in return for favorable assistance with government contracts and making false claims against the United States.
According to documents filed in this case and statements made in court:
Gooch was assigned as a general engineer and was authorized by the U.S. Army to act as its representative on contracts made with federal contracting companies. As such, he had the authority to evaluate a contracting company’s work and could influence whether additional contracts should be granted.
From January 2006 through December 2017, Gooch conspired with other Picatinny Arsenal employees and employees of a defense contracting firm identified in the information as “Company A” to seek and accept gifts and other items of value, such as Apple products, luxury handbags, Beats headphones, and tickets to a luxury sky box at professional sporting events, valued at least $150,000 to $250,000, in exchange for government contracts and other favorable assistance for Company A at Picatinny Arsenal.
Gooch also conspired with other Picatinny Arsenal and Company A employees to file false bills to the United States that wrote off the cost of the bribes as “materials” needed on the government contracts.
The conspiracy charge to which Gooch pleaded guilty carries a maximum potential penalty of five years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. Sentencing is scheduled for Sept. 11, 2018.
Irene Pombo, a Company A employee, and her daughter, Nicole Pier, another Picatinny Arsenal employee, pleaded guilty to their roles in the conspiracy in March 2018 and await sentencing.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark; the U.S. Department of Defense, Defense Criminal Investigative Service, under the direction of Special Agent in Charge Leigh-Alistair Barzey; and the U.S. Army, Major Procurement Fraud Unit, Criminal Investigation Command, under the direction of Special Agent in Charge L. Scott Moreland, with the ongoing investigation.
The government is represented by Senior Litigation Counsel Margaret Ann Mahoney of the U.S. Attorney’s Office’s National Security Unit in Newark.
Defense counsel: Stacy Biancamano Esq., Chatham, New Jersey
Description: The fiscal year of the data file obtained from the AOUSC
Format: YYYY
Description: The code of the federal judicial circuit where the case was located
Format: A2
Description: The code of the federal judicial district where the case was located
Format: A2
Description: The code of the district office where the case was located
Format: A2
Description: Docket number assigned by the district to the case
Format: A7
Description: A unique number assigned to each defendant in a case which cannot be modified by the court
Format: A3
Description: A unique number assigned to each defendant in a case which can be modified by the court
Format: A3
Description: A sequential number indicating whether a case is an original proceeding or a reopen
Format: N5
Description: Case type associated with the current defendant record
Format: A2
Description: A concatenation of district, office, docket number, case type, defendant number, and reopen sequence number
Format: A18
Description: A concatenation of district, office, docket number, case type, and reopen sequence number
Format: A15
Description: The status of the defendant as assigned by the AOUSC
Format: A2
Description: A code indicating the fugitive status of a defendant
Format: A1
Description: The date upon which a defendant became a fugitive
Format: YYYYMMDD
Description: The date upon which a fugitive defendant was taken into custody
Format: YYYYMMDD
Description: The date when a case was first docketed in the district court
Format: YYYYMMDD
Description: The date upon which proceedings in a case commenced on charges pending in the district court where the defendant appeared, or the date of the defendant’s felony-waiver of indictment
Format: YYYYMMDD
Description: A code used to identify the nature of the proceeding
Format: N2
Description: The date when a defendant first appeared before a judicial officer in the district court where a charge was pending
Format: YYYYMMDD
Description: A code indicating the event by which a defendant appeared before a judicial officer in the district court where a charge was pending
Format: A2
Description: A code indicating the type of legal counsel assigned to a defendant
Format: N2
Description: The title and section of the U.S. Code applicable to the offense committed which carried the highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE1
Format: N2
Description: The four digit AO offense code associated with FTITLE1
Format: A4
Description: The four digit D2 offense code associated with FTITLE1
Format: A4
Description: A code indicating the severity associated with FTITLE1
Format: A3
Description: The title and section of the U.S. Code applicable to the offense committed which carried the second highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE2
Format: N2
Description: The four digit AO offense code associated with FTITLE2
Format: A4
Description: The four digit D2 offense code associated with FTITLE2
Format: A4
Description: A code indicating the severity associated with FTITLE2
Format: A3
Description: The title and section of the U.S. Code applicable to the offense committed which carried the third highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE3
Format: N2
Description: The four digit AO offense code associated with FTITLE3
Format: A4
Description: The four digit D2 offense code associated with FTITLE3
Format: A4
Description: A code indicating the severity associated with FTITLE3
Format: A3
Description: The FIPS code used to indicate the county or parish where an offense was committed
Format: A5
Description: The date of the last action taken on the record
Format: YYYYMMDD
Description: The date upon which judicial proceedings before the court concluded
Format: YYYYMMDD
Description: The date upon which the final sentence is recorded on the docket
Format: YYYYMMDD
Description: The date upon which the case was closed
Format: YYYYMMDD
Description: The total fine imposed at sentencing for all offenses of which the defendant was convicted and a fine was imposed
Format: N8
Description: A count of defendants filed including inter-district transfers
Format: N1
Description: A count of defendants filed excluding inter-district transfers
Format: N1
Description: A count of original proceedings commenced
Format: N1
Description: A count of defendants filed whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants terminated including interdistrict transfers
Format: N1
Description: A count of defendants terminated excluding interdistrict transfers
Format: N1
Description: A count of original proceedings terminated
Format: N1
Description: A count of defendants terminated whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants pending as of the last day of the period including long term fugitives
Format: N1
Description: A count of defendants pending as of the last day of the period excluding long term fugitives
Format: N1
Description: The source from which the data were loaded into the AOUSC’s NewSTATS database
Format: A10
Description: A sequential number indicating the iteration of the defendant record
Format: N2
Description: The date the record was loaded into the AOUSC’s NewSTATS database
Format: YYYYMMDD
Description: Statistical year ID label on data file obtained from the AOUSC which represents termination year
ALEXANDRIA, Va. – An Alexandria man was sentenced today to 26 years in prison for production of child pornography.
According to court documents, over at least a two year period, Skydance MacMahon, 45, conspired with an adult in Canada to produce over a thousand sexually explicit images and videos of minor children in Canada. These images and videos were produced at the direction of MacMahon using Skype and hidden cameras as well as overt recording. MacMahon distributed these image and video files to other users and consumers of child pornography by providing access to the files on his cloud storage services and also by directly sending the files to other users. In addition to the child pornography images and videos MacMahon himself created, he also received and possessed thousands of images and videos of child pornography.
During the time he committed these offenses, MacMahon was a Digital Media Administrator at the Foreign Services Institute of the U.S. Department of State in Arlington.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorneys’ Offices and the Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Nancy McNamara, Assistant Director in Charge of the FBI’s Washington Field Office, and Steve A. Linick, Inspector General for the Department of State, made the announcement after sentencing by U.S. District Judge Anthony J. Trenga. Assistant U.S. Attorney Whitney Dougherty Russell prosecuted the case.
Significant assistance was provided by the FBI’s Cincinnati Field Office, the U.S. Department of State Office of Inspector General’s Cyber Forensic Division, the Royal Canadian Mounted Police, the Halifax Regional Police, Crown Prosecution Service, Special Prosecution Section, the Nova Scotia Public Prosecution Service, the Arlington County Police Department, and the Arlington County Commonwealth’s Attorney’s Office.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:18-cr-261.
ALEXANDRIA, Va. – An Alexandria man pleaded guilty today to production of child pornography.
According to court documents, over at least a two year period, Skydance MacMahon, 44, conspired with an adult in Canada to produce over a thousand sexually explicit images and videos of minor children in Canada. These images and videos were produced at the direction of MacMahon using Skype and hidden cameras. MacMahon distributed these image and video files to other users and consumers of child pornography by providing access to the files on his cloud storage services and also by directly sending the files to other users. In addition to the child pornography images and videos MacMahon himself created, he also received and possessed thousands of images and videos of child pornography.
During the time he committed these offenses, MacMahon was a Digital Media Administrator at the Foreign Services Institute of the U.S. Department of State in Arlington.
MacMahon pleaded guilty to conspiring to produce child pornography and producing child pornography. He faces a mandatory minimum of 15 years and a maximum penalty of 60 years in prison when sentenced on October 12. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorneys’ Offices and the Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Nancy McNamara, Assistant Director in Charge of the FBI’s Washington Field Office, and Steve A. Linick, Inspector General for the Department of State, made the announcement after U.S. District Judge Anthony J. Trenga accepted the plea. Assistant U.S. Attorney Whitney Dougherty Russell is prosecuting the case.
Significant assistance was provided by the FBI’s Cincinnati Field Office, the U.S. Department of State Office of Inspector General’s Cyber Forensic Division, the Royal Canadian Mounted Police, the Halifax Regional Police, Crown Prosecution Service, Special Prosecution Section, the Nova Scotia Public Prosecution Service, the Arlington County Police Department, and the Arlington County Commonwealth’s Attorney’s Office.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:18-cr-261.
Description: The fiscal year of the data file obtained from the AOUSC
Format: YYYY
Description: The code of the federal judicial circuit where the case was located
Format: A2
Description: The code of the federal judicial district where the case was located
Format: A2
Description: The code of the district office where the case was located
Format: A2
Description: Docket number assigned by the district to the case
Format: A7
Description: A unique number assigned to each defendant in a case which cannot be modified by the court
Format: A3
Description: A unique number assigned to each defendant in a case which can be modified by the court
Format: A3
Description: A sequential number indicating whether a case is an original proceeding or a reopen
Format: N5
Description: Case type associated with the current defendant record
Format: A2
Description: Case type associated with a magistrate case if the current case was merged from a magistrate case
Format: A2
Description: A concatenation of district, office, docket number, case type, defendant number, and reopen sequence number
Format: A18
Description: A concatenation of district, office, docket number, case type, and reopen sequence number
Format: A15
Description: The docket number originally given to a case assigned to a magistrate judge and subsequently merged into a criminal case
Format: A7
Description: A unique number assigned to each defendant in a magistrate case
Format: A3
Description: The status of the defendant as assigned by the AOUSC
Format: A2
Description: A code indicating the fugitive status of a defendant
Format: A1
Description: The date upon which a defendant became a fugitive
Format: YYYYMMDD
Description: The date upon which a fugitive defendant was taken into custody
Format: YYYYMMDD
Description: The date when a case was first docketed in the district court
Format: YYYYMMDD
Description: The date upon which proceedings in a case commenced on charges pending in the district court where the defendant appeared, or the date of the defendant’s felony-waiver of indictment
Format: YYYYMMDD
Description: A code used to identify the nature of the proceeding
Format: N2
Description: The date when a defendant first appeared before a judicial officer in the district court where a charge was pending
Format: YYYYMMDD
Description: A code indicating the event by which a defendant appeared before a judicial officer in the district court where a charge was pending
Format: A2
Description: A code indicating the type of legal counsel assigned to a defendant
Format: N2
Description: The title and section of the U.S. Code applicable to the offense committed which carried the highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE1
Format: N2
Description: The four digit AO offense code associated with FTITLE1
Format: A4
Description: The four digit D2 offense code associated with FTITLE1
Format: A4
Description: A code indicating the severity associated with FTITLE1
Format: A3
Description: The title and section of the U.S. Code applicable to the offense committed which carried the second highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE2
Format: N2
Description: The four digit AO offense code associated with FTITLE2
Format: A4
Description: The four digit D2 offense code associated with FTITLE2
Format: A4
Description: A code indicating the severity associated with FTITLE2
Format: A3
Description: The FIPS code used to indicate the county or parish where an offense was committed
Format: A5
Description: The date of the last action taken on the record
Format: YYYYMMDD
Description: The date upon which judicial proceedings before the court concluded
Format: YYYYMMDD
Description: The date upon which the final sentence is recorded on the docket
Format: YYYYMMDD
Description: The date upon which the case was closed
Format: YYYYMMDD
Description: The total fine imposed at sentencing for all offenses of which the defendant was convicted and a fine was imposed
Format: N8
Description: A count of defendants filed including inter-district transfers
Format: N1
Description: A count of defendants filed excluding inter-district transfers
Format: N1
Description: A count of original proceedings commenced
Format: N1
Description: A count of defendants filed whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants terminated including interdistrict transfers
Format: N1
Description: A count of defendants terminated excluding interdistrict transfers
Format: N1
Description: A count of original proceedings terminated
Format: N1
Description: A count of defendants terminated whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants pending as of the last day of the period including long term fugitives
Format: N1
Description: A count of defendants pending as of the last day of the period excluding long term fugitives
Format: N1
Description: The source from which the data were loaded into the AOUSC’s NewSTATS database
Format: A10
Description: A sequential number indicating the iteration of the defendant record
Format: N2
Description: The date the record was loaded into the AOUSC’s NewSTATS database
Format: YYYYMMDD
Description: Statistical year ID label on data file obtained from the AOUSC which represents termination year
Description: The fiscal year of the data file obtained from the AOUSC
Format: YYYY
Description: The code of the federal judicial circuit where the case was located
Format: A2
Description: The code of the federal judicial district where the case was located
Format: A2
Description: The code of the district office where the case was located
Format: A2
Description: Docket number assigned by the district to the case
Format: A7
Description: A unique number assigned to each defendant in a case which cannot be modified by the court
Format: A3
Description: A unique number assigned to each defendant in a case which can be modified by the court
Format: A3
Description: A sequential number indicating whether a case is an original proceeding or a reopen
Format: N5
Description: Case type associated with the current defendant record
Format: A2
Description: Case type associated with a magistrate case if the current case was merged from a magistrate case
Format: A2
Description: A concatenation of district, office, docket number, case type, defendant number, and reopen sequence number
Format: A18
Description: A concatenation of district, office, docket number, case type, and reopen sequence number
Format: A15
Description: The docket number originally given to a case assigned to a magistrate judge and subsequently merged into a criminal case
Format: A7
Description: A unique number assigned to each defendant in a magistrate case
Format: A3
Description: The status of the defendant as assigned by the AOUSC
Format: A2
Description: A code indicating the fugitive status of a defendant
Format: A1
Description: The date upon which a defendant became a fugitive
Format: YYYYMMDD
Description: The date upon which a fugitive defendant was taken into custody
Format: YYYYMMDD
Description: The date when a case was first docketed in the district court
Format: YYYYMMDD
Description: The date upon which proceedings in a case commenced on charges pending in the district court where the defendant appeared, or the date of the defendant’s felony-waiver of indictment
Format: YYYYMMDD
Description: A code used to identify the nature of the proceeding
Format: N2
Description: The date when a defendant first appeared before a judicial officer in the district court where a charge was pending
Format: YYYYMMDD
Description: A code indicating the event by which a defendant appeared before a judicial officer in the district court where a charge was pending
Format: A2
Description: A code indicating the type of legal counsel assigned to a defendant
Format: N2
Description: The title and section of the U.S. Code applicable to the offense committed which carried the highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE1
Format: N2
Description: The four digit AO offense code associated with FTITLE1
Format: A4
Description: The four digit D2 offense code associated with FTITLE1
Format: A4
Description: A code indicating the severity associated with FTITLE1
Format: A3
Description: The title and section of the U.S. Code applicable to the offense committed which carried the second highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE2
Format: N2
Description: The four digit AO offense code associated with FTITLE2
Format: A4
Description: The four digit D2 offense code associated with FTITLE2
Format: A4
Description: A code indicating the severity associated with FTITLE2
Format: A3
Description: The FIPS code used to indicate the county or parish where an offense was committed
Format: A5
Description: The date of the last action taken on the record
Format: YYYYMMDD
Description: The date upon which judicial proceedings before the court concluded
Format: YYYYMMDD
Description: The date upon which the final sentence is recorded on the docket
Format: YYYYMMDD
Description: The date upon which the case was closed
Format: YYYYMMDD
Description: The total fine imposed at sentencing for all offenses of which the defendant was convicted and a fine was imposed
Format: N8
Description: A count of defendants filed including inter-district transfers
Format: N1
Description: A count of defendants filed excluding inter-district transfers
Format: N1
Description: A count of original proceedings commenced
Format: N1
Description: A count of defendants filed whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants terminated including interdistrict transfers
Format: N1
Description: A count of defendants terminated excluding interdistrict transfers
Format: N1
Description: A count of original proceedings terminated
Format: N1
Description: A count of defendants terminated whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants pending as of the last day of the period including long term fugitives
Format: N1
Description: A count of defendants pending as of the last day of the period excluding long term fugitives
Format: N1
Description: The source from which the data were loaded into the AOUSC’s NewSTATS database
Format: A10
Description: A sequential number indicating the iteration of the defendant record
Format: N2
Description: The date the record was loaded into the AOUSC’s NewSTATS database
Format: YYYYMMDD
Description: Statistical year ID label on data file obtained from the AOUSC which represents termination year
Description: The fiscal year of the data file obtained from the AOUSC
Format: YYYY
Description: The code of the federal judicial circuit where the case was located
Format: A2
Description: The code of the federal judicial district where the case was located
Format: A2
Description: The code of the district office where the case was located
Format: A2
Description: Docket number assigned by the district to the case
Format: A7
Description: A unique number assigned to each defendant in a case which cannot be modified by the court
Format: A3
Description: A unique number assigned to each defendant in a case which can be modified by the court
Format: A3
Description: A sequential number indicating whether a case is an original proceeding or a reopen
Format: N5
Description: Case type associated with the current defendant record
Format: A2
Description: Case type associated with a magistrate case if the current case was merged from a magistrate case
Format: A2
Description: A concatenation of district, office, docket number, case type, defendant number, and reopen sequence number
Format: A18
Description: A concatenation of district, office, docket number, case type, and reopen sequence number
Format: A15
Description: The docket number originally given to a case assigned to a magistrate judge and subsequently merged into a criminal case
Format: A7
Description: A unique number assigned to each defendant in a magistrate case
Format: A3
Description: The status of the defendant as assigned by the AOUSC
Format: A2
Description: A code indicating the fugitive status of a defendant
Format: A1
Description: The date upon which a defendant became a fugitive
Format: YYYYMMDD
Description: The date upon which a fugitive defendant was taken into custody
Format: YYYYMMDD
Description: The date when a case was first docketed in the district court
Format: YYYYMMDD
Description: The date upon which proceedings in a case commenced on charges pending in the district court where the defendant appeared, or the date of the defendant’s felony-waiver of indictment
Format: YYYYMMDD
Description: A code used to identify the nature of the proceeding
Format: N2
Description: The date when a defendant first appeared before a judicial officer in the district court where a charge was pending
Format: YYYYMMDD
Description: A code indicating the event by which a defendant appeared before a judicial officer in the district court where a charge was pending
Format: A2
Description: A code indicating the type of legal counsel assigned to a defendant
Format: N2
Description: The title and section of the U.S. Code applicable to the offense committed which carried the highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE1
Format: N2
Description: The four digit AO offense code associated with FTITLE1
Format: A4
Description: The four digit D2 offense code associated with FTITLE1
Format: A4
Description: A code indicating the severity associated with FTITLE1
Format: A3
Description: The title and section of the U.S. Code applicable to the offense committed which carried the second highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE2
Format: N2
Description: The four digit AO offense code associated with FTITLE2
Format: A4
Description: The four digit D2 offense code associated with FTITLE2
Format: A4
Description: A code indicating the severity associated with FTITLE2
Format: A3
Description: The FIPS code used to indicate the county or parish where an offense was committed
Format: A5
Description: The date of the last action taken on the record
Format: YYYYMMDD
Description: The date upon which judicial proceedings before the court concluded
Format: YYYYMMDD
Description: The date upon which the final sentence is recorded on the docket
Format: YYYYMMDD
Description: The date upon which the case was closed
Format: YYYYMMDD
Description: The total fine imposed at sentencing for all offenses of which the defendant was convicted and a fine was imposed
Format: N8
Description: A count of defendants filed including inter-district transfers
Format: N1
Description: A count of defendants filed excluding inter-district transfers
Format: N1
Description: A count of original proceedings commenced
Format: N1
Description: A count of defendants filed whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants terminated including interdistrict transfers
Format: N1
Description: A count of defendants terminated excluding interdistrict transfers
Format: N1
Description: A count of original proceedings terminated
Format: N1
Description: A count of defendants terminated whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants pending as of the last day of the period including long term fugitives
Format: N1
Description: A count of defendants pending as of the last day of the period excluding long term fugitives
Format: N1
Description: The source from which the data were loaded into the AOUSC’s NewSTATS database
Format: A10
Description: A sequential number indicating the iteration of the defendant record
Format: N2
Description: The date the record was loaded into the AOUSC’s NewSTATS database
Format: YYYYMMDD
Description: Statistical year ID label on data file obtained from the AOUSC which represents termination year
Description: The fiscal year of the data file obtained from the AOUSC
Format: YYYY
Description: The code of the federal judicial circuit where the case was located
Format: A2
Description: The code of the federal judicial district where the case was located
Format: A2
Description: The code of the district office where the case was located
Format: A2
Description: Docket number assigned by the district to the case
Format: A7
Description: A unique number assigned to each defendant in a case which cannot be modified by the court
Format: A3
Description: A unique number assigned to each defendant in a case which can be modified by the court
Format: A3
Description: A sequential number indicating whether a case is an original proceeding or a reopen
Format: N5
Description: Case type associated with the current defendant record
Format: A2
Description: Case type associated with a magistrate case if the current case was merged from a magistrate case
Format: A2
Description: A concatenation of district, office, docket number, case type, defendant number, and reopen sequence number
Format: A18
Description: A concatenation of district, office, docket number, case type, and reopen sequence number
Format: A15
Description: The docket number originally given to a case assigned to a magistrate judge and subsequently merged into a criminal case
Format: A7
Description: A unique number assigned to each defendant in a magistrate case
Format: A3
Description: The status of the defendant as assigned by the AOUSC
Format: A2
Description: A code indicating the fugitive status of a defendant
Format: A1
Description: The date upon which a defendant became a fugitive
Format: YYYYMMDD
Description: The date upon which a fugitive defendant was taken into custody
Format: YYYYMMDD
Description: The date when a case was first docketed in the district court
Format: YYYYMMDD
Description: The date upon which proceedings in a case commenced on charges pending in the district court where the defendant appeared, or the date of the defendant’s felony-waiver of indictment
Format: YYYYMMDD
Description: A code used to identify the nature of the proceeding
Format: N2
Description: The date when a defendant first appeared before a judicial officer in the district court where a charge was pending
Format: YYYYMMDD
Description: A code indicating the event by which a defendant appeared before a judicial officer in the district court where a charge was pending
Format: A2
Description: A code indicating the type of legal counsel assigned to a defendant
Format: N2
Description: The title and section of the U.S. Code applicable to the offense committed which carried the highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE1
Format: N2
Description: The four digit AO offense code associated with FTITLE1
Format: A4
Description: The four digit D2 offense code associated with FTITLE1
Format: A4
Description: A code indicating the severity associated with FTITLE1
Format: A3
Description: The title and section of the U.S. Code applicable to the offense committed which carried the second highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE2
Format: N2
Description: The four digit AO offense code associated with FTITLE2
Format: A4
Description: The four digit D2 offense code associated with FTITLE2
Format: A4
Description: A code indicating the severity associated with FTITLE2
Format: A3
Description: The FIPS code used to indicate the county or parish where an offense was committed
Format: A5
Description: The date of the last action taken on the record
Format: YYYYMMDD
Description: The date upon which judicial proceedings before the court concluded
Format: YYYYMMDD
Description: The date upon which the final sentence is recorded on the docket
Format: YYYYMMDD
Description: The date upon which the case was closed
Format: YYYYMMDD
Description: The total fine imposed at sentencing for all offenses of which the defendant was convicted and a fine was imposed
Format: N8
Description: A count of defendants filed including inter-district transfers
Format: N1
Description: A count of defendants filed excluding inter-district transfers
Format: N1
Description: A count of original proceedings commenced
Format: N1
Description: A count of defendants filed whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants terminated including interdistrict transfers
Format: N1
Description: A count of defendants terminated excluding interdistrict transfers
Format: N1
Description: A count of original proceedings terminated
Format: N1
Description: A count of defendants terminated whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants pending as of the last day of the period including long term fugitives
Format: N1
Description: A count of defendants pending as of the last day of the period excluding long term fugitives
Format: N1
Description: The source from which the data were loaded into the AOUSC’s NewSTATS database
Format: A10
Description: A sequential number indicating the iteration of the defendant record
Format: N2
Description: The date the record was loaded into the AOUSC’s NewSTATS database
Format: YYYYMMDD
Description: Statistical year ID label on data file obtained from the AOUSC which represents termination year
Description: The fiscal year of the data file obtained from the AOUSC
Format: YYYY
Description: The code of the federal judicial circuit where the case was located
Format: A2
Description: The code of the federal judicial district where the case was located
Format: A2
Description: The code of the district office where the case was located
Format: A2
Description: Docket number assigned by the district to the case
Format: A7
Description: A unique number assigned to each defendant in a case which cannot be modified by the court
Format: A3
Description: A unique number assigned to each defendant in a case which can be modified by the court
Format: A3
Description: A sequential number indicating whether a case is an original proceeding or a reopen
Format: N5
Description: Case type associated with the current defendant record
Format: A2
Description: Case type associated with a magistrate case if the current case was merged from a magistrate case
Format: A2
Description: A concatenation of district, office, docket number, case type, defendant number, and reopen sequence number
Format: A18
Description: A concatenation of district, office, docket number, case type, and reopen sequence number
Format: A15
Description: The docket number originally given to a case assigned to a magistrate judge and subsequently merged into a criminal case
Format: A7
Description: A unique number assigned to each defendant in a magistrate case
Format: A3
Description: The status of the defendant as assigned by the AOUSC
Format: A2
Description: A code indicating the fugitive status of a defendant
Format: A1
Description: The date upon which a defendant became a fugitive
Format: YYYYMMDD
Description: The date upon which a fugitive defendant was taken into custody
Format: YYYYMMDD
Description: The date when a case was first docketed in the district court
Format: YYYYMMDD
Description: The date upon which proceedings in a case commenced on charges pending in the district court where the defendant appeared, or the date of the defendant’s felony-waiver of indictment
Format: YYYYMMDD
Description: A code used to identify the nature of the proceeding
Format: N2
Description: The date when a defendant first appeared before a judicial officer in the district court where a charge was pending
Format: YYYYMMDD
Description: A code indicating the event by which a defendant appeared before a judicial officer in the district court where a charge was pending
Format: A2
Description: A code indicating the type of legal counsel assigned to a defendant
Format: N2
Description: The title and section of the U.S. Code applicable to the offense committed which carried the highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE1
Format: N2
Description: The four digit AO offense code associated with FTITLE1
Format: A4
Description: The four digit D2 offense code associated with FTITLE1
Format: A4
Description: A code indicating the severity associated with FTITLE1
Format: A3
Description: The title and section of the U.S. Code applicable to the offense committed which carried the second highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE2
Format: N2
Description: The four digit AO offense code associated with FTITLE2
Format: A4
Description: The four digit D2 offense code associated with FTITLE2
Format: A4
Description: A code indicating the severity associated with FTITLE2
Format: A3
Description: The FIPS code used to indicate the county or parish where an offense was committed
Format: A5
Description: The date of the last action taken on the record
Format: YYYYMMDD
Description: The date upon which judicial proceedings before the court concluded
Format: YYYYMMDD
Description: The date upon which the final sentence is recorded on the docket
Format: YYYYMMDD
Description: The date upon which the case was closed
Format: YYYYMMDD
Description: The total fine imposed at sentencing for all offenses of which the defendant was convicted and a fine was imposed
Format: N8
Description: A count of defendants filed including inter-district transfers
Format: N1
Description: A count of defendants filed excluding inter-district transfers
Format: N1
Description: A count of original proceedings commenced
Format: N1
Description: A count of defendants filed whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants terminated including interdistrict transfers
Format: N1
Description: A count of defendants terminated excluding interdistrict transfers
Format: N1
Description: A count of original proceedings terminated
Format: N1
Description: A count of defendants terminated whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants pending as of the last day of the period including long term fugitives
Format: N1
Description: A count of defendants pending as of the last day of the period excluding long term fugitives
Format: N1
Description: The source from which the data were loaded into the AOUSC’s NewSTATS database
Format: A10
Description: A sequential number indicating the iteration of the defendant record
Format: N2
Description: The date the record was loaded into the AOUSC’s NewSTATS database
Format: YYYYMMDD
Description: Statistical year ID label on data file obtained from the AOUSC which represents termination year
Description: The fiscal year of the data file obtained from the AOUSC
Format: YYYY
Description: The code of the federal judicial circuit where the case was located
Format: A2
Description: The code of the federal judicial district where the case was located
Format: A2
Description: The code of the district office where the case was located
Format: A2
Description: Docket number assigned by the district to the case
Format: A7
Description: A unique number assigned to each defendant in a case which cannot be modified by the court
Format: A3
Description: A unique number assigned to each defendant in a case which can be modified by the court
Format: A3
Description: A sequential number indicating whether a case is an original proceeding or a reopen
Format: N5
Description: Case type associated with the current defendant record
Format: A2
Description: Case type associated with a magistrate case if the current case was merged from a magistrate case
Format: A2
Description: A concatenation of district, office, docket number, case type, defendant number, and reopen sequence number
Format: A18
Description: A concatenation of district, office, docket number, case type, and reopen sequence number
Format: A15
Description: The docket number originally given to a case assigned to a magistrate judge and subsequently merged into a criminal case
Format: A7
Description: A unique number assigned to each defendant in a magistrate case
Format: A3
Description: The status of the defendant as assigned by the AOUSC
Format: A2
Description: A code indicating the fugitive status of a defendant
Format: A1
Description: The date upon which a defendant became a fugitive
Format: YYYYMMDD
Description: The date upon which a fugitive defendant was taken into custody
Format: YYYYMMDD
Description: The date when a case was first docketed in the district court
Format: YYYYMMDD
Description: The date upon which proceedings in a case commenced on charges pending in the district court where the defendant appeared, or the date of the defendant’s felony-waiver of indictment
Format: YYYYMMDD
Description: A code used to identify the nature of the proceeding
Format: N2
Description: The date when a defendant first appeared before a judicial officer in the district court where a charge was pending
Format: YYYYMMDD
Description: A code indicating the event by which a defendant appeared before a judicial officer in the district court where a charge was pending
Format: A2
Description: A code indicating the type of legal counsel assigned to a defendant
Format: N2
Description: The title and section of the U.S. Code applicable to the offense committed which carried the highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE1
Format: N2
Description: The four digit AO offense code associated with FTITLE1
Format: A4
Description: The four digit D2 offense code associated with FTITLE1
Format: A4
Description: A code indicating the severity associated with FTITLE1
Format: A3
Description: The title and section of the U.S. Code applicable to the offense committed which carried the second highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE2
Format: N2
Description: The four digit AO offense code associated with FTITLE2
Format: A4
Description: The four digit D2 offense code associated with FTITLE2
Format: A4
Description: A code indicating the severity associated with FTITLE2
Format: A3
Description: The FIPS code used to indicate the county or parish where an offense was committed
Format: A5
Description: The date of the last action taken on the record
Format: YYYYMMDD
Description: The date upon which judicial proceedings before the court concluded
Format: YYYYMMDD
Description: The date upon which the final sentence is recorded on the docket
Format: YYYYMMDD
Description: The date upon which the case was closed
Format: YYYYMMDD
Description: The total fine imposed at sentencing for all offenses of which the defendant was convicted and a fine was imposed
Format: N8
Description: A count of defendants filed including inter-district transfers
Format: N1
Description: A count of defendants filed excluding inter-district transfers
Format: N1
Description: A count of original proceedings commenced
Format: N1
Description: A count of defendants filed whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants terminated including interdistrict transfers
Format: N1
Description: A count of defendants terminated excluding interdistrict transfers
Format: N1
Description: A count of original proceedings terminated
Format: N1
Description: A count of defendants terminated whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants pending as of the last day of the period including long term fugitives
Format: N1
Description: A count of defendants pending as of the last day of the period excluding long term fugitives
Format: N1
Description: The source from which the data were loaded into the AOUSC’s NewSTATS database
Format: A10
Description: A sequential number indicating the iteration of the defendant record
Format: N2
Description: The date the record was loaded into the AOUSC’s NewSTATS database
Format: YYYYMMDD
Description: Statistical year ID label on data file obtained from the AOUSC which represents termination year
PHOENIX – This week, U.S. District Judge Diane J. Humetewa sentenced William “Lance” Mullins, 50, formerly of Scottsdale, Ariz., to 42 months in prison and three years of supervised release. The Court also ordered Mullins to pay more than $2.8 million in restitution to 125 victim shareholders. Mullins had previously pleaded guilty to engaging in fraudulent interstate securities transactions.
Mullins was involved with a Tempe, Ariz.-based technology company called Xhibit Corporation, whose stock was publicly traded on the over-the-counter market and which merged with the airplane catalog SkyMall in May 2013. In 2012 and 2013, before the SkyMall merger, Mullins and others made misrepresentations about the company when recruiting investors. They also engaged in manipulative trading of Xhibit stock that is prohibited by U.S. securities laws and regulations. Their prohibited trading activities artificially inflated Xhibit’s stock price and made it falsely appear that there was more demand for the stock. Because of these actions and other events, Xhibit’s stock price rose sharply, from less than a dollar in early 2012 to a peak of more than seven dollars in May 2013, and then fell just as quickly. Mullins made more than $1 million from selling much of his own stock before the stock price dramatically fell, while unknowing shareholders lost millions.
Two others pleaded guilty to conspiracy to commit securities fraud in related cases and were sentenced in June 2019. Nicolas Russo, Jr., 72, of Fountain Hills, Arizona, and Larry Eiteljorg, 70, of Scottsdale, Arizona, were sentenced to probation and ordered to pay restitution after cooperating with the government’s investigation.
“Mr. Mullins was the mastermind of this market manipulation scheme and the 42-month prison sentence Mullins received should send a strong message of deterrence to criminals committing securities fraud in Arizona,” said Sean Kaul, Special Agent in Charge of the FBI Phoenix Division. “We are pleased that all defendants have been ordered to pay restitution to the victims. The FBI will continue to work aggressively with our law enforcement partners to investigate those who commit complex financial crimes. We thank the Arizona U.S. Attorney’s office for their work in prosecuting this case.”
The investigation in this case was conducted by the Federal Bureau of Investigation. The prosecution was handled by Bridget Minder and Peter Sexton, Assistant United States Attorneys, District of Arizona, Phoenix.
Description: The fiscal year of the data file obtained from the AOUSC
Format: YYYY
Description: The code of the federal judicial circuit where the case was located
Format: A2
Description: The code of the federal judicial district where the case was located
Format: A2
Description: The code of the district office where the case was located
Format: A2
Description: Docket number assigned by the district to the case
Format: A7
Description: A unique number assigned to each defendant in a case which cannot be modified by the court
Format: A3
Description: A unique number assigned to each defendant in a case which can be modified by the court
Format: A3
Description: A sequential number indicating whether a case is an original proceeding or a reopen
Format: N5
Description: Case type associated with the current defendant record
Format: A2
Description: A concatenation of district, office, docket number, case type, defendant number, and reopen sequence number
Format: A18
Description: A concatenation of district, office, docket number, case type, and reopen sequence number
Format: A15
Description: The status of the defendant as assigned by the AOUSC
Format: A2
Description: A code indicating the fugitive status of a defendant
Format: A1
Description: The date upon which a defendant became a fugitive
Format: YYYYMMDD
Description: The date upon which a fugitive defendant was taken into custody
Format: YYYYMMDD
Description: The date when a case was first docketed in the district court
Format: YYYYMMDD
Description: The date upon which proceedings in a case commenced on charges pending in the district court where the defendant appeared, or the date of the defendant’s felony-waiver of indictment
Format: YYYYMMDD
Description: A code used to identify the nature of the proceeding
Format: N2
Description: The date when a defendant first appeared before a judicial officer in the district court where a charge was pending
Format: YYYYMMDD
Description: A code indicating the event by which a defendant appeared before a judicial officer in the district court where a charge was pending
Format: A2
Description: A code indicating the type of legal counsel assigned to a defendant
Format: N2
Description: The title and section of the U.S. Code applicable to the offense committed which carried the highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE1
Format: N2
Description: The four digit AO offense code associated with FTITLE1
Format: A4
Description: The four digit D2 offense code associated with FTITLE1
Format: A4
Description: A code indicating the severity associated with FTITLE1
Format: A3
Description: The FIPS code used to indicate the county or parish where an offense was committed
Format: A5
Description: The date of the last action taken on the record
Format: YYYYMMDD
Description: The date upon which judicial proceedings before the court concluded
Format: YYYYMMDD
Description: The date upon which the final sentence is recorded on the docket
Format: YYYYMMDD
Description: The date upon which the case was closed
Format: YYYYMMDD
Description: The number of days from the earlier of filing date or first appearance date to proceeding date
Format: N3
Description: The number of days from proceeding date to disposition date
Format: N3
Description: The number of days from disposition date to sentencing date
Format: N3
Description: The code of the district office where the case was terminated
Format: A2
Description: A code indicating the type of legal counsel assigned to a defendant at the time the case was closed
Format: N2
Description: The title and section of the U.S. Code applicable to the offense that carried the most severe disposition and penalty under which the defendant was disposed
Format: A20
Description: A code indicating the level of offense associated with TTITLE1
Format: N2
Description: The four digit AO offense code associated with TTITLE1
Format: A4
Description: The four digit D2 offense code associated with TTITLE1
Format: A4
Description: A code indicating the severity associated with TTITLE1
Format: A3
Description: The code indicating the nature or type of disposition associated with TTITLE1
Format: N2
Description: The number of months a defendant was sentenced to prison under TTITLE1
Format: N4
Description: A code indicating whether the prison sentence associated with TTITLE1 was concurrent or consecutive in relation to the other counts in the indictment or information or multiple counts of the same charge
Format: A4
Description: The number of months of probation imposed upon a defendant under TTITLE1
Format: N4
Description: A period of supervised release imposed upon a defendant under TTITLE1
Format: N3
Description: The fine imposed upon the defendant at sentencing under TTITLE1
Format: N8
Description: The total prison time for all offenses of which the defendant was convicted and prison time was imposed
Format: N4
Description: The total fine imposed at sentencing for all offenses of which the defendant was convicted and a fine was imposed
Format: N8
Description: A count of defendants filed including inter-district transfers
Format: N1
Description: A count of defendants filed excluding inter-district transfers
Format: N1
Description: A count of original proceedings commenced
Format: N1
Description: A count of defendants filed whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants terminated including interdistrict transfers
Format: N1
Description: A count of defendants terminated excluding interdistrict transfers
Format: N1
Description: A count of original proceedings terminated
Format: N1
Description: A count of defendants terminated whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants pending as of the last day of the period including long term fugitives
Format: N1
Description: A count of defendants pending as of the last day of the period excluding long term fugitives
Format: N1
Description: The source from which the data were loaded into the AOUSC’s NewSTATS database
Format: A10
Description: A sequential number indicating the iteration of the defendant record
Format: N2
Description: The date the record was loaded into the AOUSC’s NewSTATS database
Format: YYYYMMDD
Description: Statistical year ID label on data file obtained from the AOUSC which represents termination year
LOS ANGELES – Former Los Angeles City Councilmember José Huizar pleaded guilty today to federal criminal charges for using his powerful position at City Hall to enrich himself and his associates, and for cheating on his taxes.
Huizar, 54, of Boyle Heights, pleaded guilty to one count of conspiracy to violate the Racketeer Influenced and Corrupt Organizations (RICO) Act and one count of tax evasion. The plea agreement was filed Thursday in United States District Court.
Huizar represented Council District 14 (CD-14), which includes downtown Los Angeles and its surrounding communities, from 2005 until his resignation in 2020.
In his plea agreement, Huizar admitted to leading the CD-14 Enterprise, which operated as a pay-to-play scheme in which Huizar – assisted by others – unlawfully used his office to give favorable treatment to real estate developers who financed and facilitated bribes and other illicit financial benefits.
Specifically, Huizar and other city officials demanded and accepted cash bribes, casino gambling chips, prostitution and escort services, political contributions, flights on private jets and commercial airlines, stays at luxury hotels and casinos, expensive meals, tickets to concerts and sporting events, and other benefits.
Huizar also admitted to accepting a $600,000 bribe in the form of collateral from a billionaire real estate developer for Huizar to confidentially settle a pending sexual harassment lawsuit against Huizar by a former staffer.
“Huizar has admitted to orchestrating a racketeering scheme that enriched himself and others as they sought to monopolize political power at the expense of Los Angeles residents,” said United States Attorney Martin Estrada. “This is one of the most wide-ranging and brazen public corruption cases ever uncovered in this district, demonstrating that our office will use all the tools of the federal government to vigorously prosecute crooked politicians whose betrayal of the public trust significantly erodes confidence in our local government.”
“Mr. Huizar's actions, to include accepting a staggering amount of bribe money and lavish gifts, eroded the trust in the office he held for many years,” said Donald Alway, the Assistant Director in Charge of the FBI's Los Angeles Field Office. “Angelenos deserve better than being used for the personal enrichment of politicians grifting the system and foreign investors whose currency is corruption. I'm proud of the investigators and prosecutors whose hard work led to today's admission of guilt.”
Huizar led the CD-14 Enterprise from at least February 2013 until July 2020, including for several years when he chaired the city’s Planning and Land Use Management (PLUM) Committee, which oversaw major commercial and residential development projects in the city.
Members and associates of the CD-14 Enterprise also included lobbyists, consultants, and other city officials and staffers, who sought to personally enrich themselves and their families and associates in exchange for official acts. These members included George Esparza, Huizar’s former special assistant, real estate development consultant George Chiang, political fundraiser Justin Jangwoo Kim, and lobbyist Morrie Goldman, among others. Each of these individuals has pleaded guilty in this case, is cooperating with the government’s investigation, and awaits sentencing.
The enterprise’s members and associates raised and solicited funds from developers and their proxies with projects in CD-14 to be paid to Huizar’s desired accounts and political action committees, including to benefit a Huizar relative’s campaign for the CD-14 seat.
In exchange for these benefits, Huizar, Esparza and other city officials agreed to perform and performed official acts, including:
presenting motions and resolutions in various city committees to benefit projects;
voting on projects in various city committees, including the PLUM Committee, and City Council;
taking, or not taking, action in the PLUM Committee to expedite or delay the approval process and affect project costs;
exerting pressure on city officials to influence the approval and/or permitting process of projects;
using their office to negotiate with and exert pressure on labor unions to resolve issues on projects;
leveraging voting and scheduling power to pressure developers with projects pending before the city to affect their business practices; and
introducing or voting on city resolutions to enhance the professional reputation and marketability of businesspersons in the city.
In return for Huizar pleading guilty to the two felony counts, prosecutors have agreed to seek no more than 13 years in prison for Huizar, who also has agreed to forfeit $129,000 in cash that law enforcement found during a law enforcement search of his home in November 2018. The government also intends to seek more than $1 million in restitution on the city’s behalf.
As part of the plea agreement, Huizar has agreed to seek a sentence of no less than nine years in prison.
United States District Judge John F. Walter scheduled an April 3 sentencing hearing for Huizar.
The plea agreement is “binding,” which means the court must accept or reject all aspects of it. Should the court reject the plea agreement, any party may withdraw from it. Judge Walter said at today’s hearing that he would make that decision prior to Huizar’s sentencing date.
In June 2022, real estate developer Dae Yong Lee, a.k.a. “David Lee,” 57, of Bel Air and one of his companies, 940 Hill LLC, were found guilty of providing $500,000 in cash to Huizar and Esparza in exchange for their help in resolving a labor organization’s appeal of their downtown Los Angeles development project. Both defendants are scheduled to be sentenced on May 5.
In November 2022, downtown Los Angeles-based company Shen Zhen New World I LLC was found guilty of eight felonies for – through the actions of its owner, billionaire real estate developer and fugitive Wei Huang, 57, of Shenzhen, China – paying more than $1 million in bribes – including luxury trip expenses, casino gambling chips and the $600,000 sham loan – to Huizar to obtain city approval to build a 77-story skyscraper. The company’s sentencing hearing is scheduled for May 12. Huang, who is charged with several felonies, has yet to make a court appearance in this case and is considered a fugitive believed to be in China.
On February 21, former Los Angeles deputy mayor and co-defendant Raymond She Wah Chan, 66, of Monterey Park, is scheduled to go on trial. Chan, who is accused of being a member of the corrupt CD-14 Enterprise, has pleaded not guilty to charges of RICO conspiracy, bribery, honest services fraud and lying to federal agents.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
In a related case, Huizar’s brother, Salvador Huizar, 56, of Boyle Heights, pleaded guilty in October 2022 to lying to federal investigators and a federal grand jury about accepting cash from his brother on numerous occasions in exchange for paying certain of Huizar’s bills. Salvador Huizar’s sentencing hearing is scheduled for May 15.
The FBI is investigating this matter, with assistance from IRS Criminal Investigation.
Assistant United States Attorney Mack E. Jenkins, Chief of the Criminal Division, and Assistant United States Attorneys Cassie D. Palmer, Susan S. Har, and Brian R. Faerstein of the Public Corruption and Civil Rights Section, are prosecuting this case.
Any member of the public who has information related to this or any other public corruption matter in the City of Los Angeles is encouraged to send information to the FBI’s email tip line at pctips-losangeles@fbi.gov or to contact the FBI’s Los Angeles Field Office at (310) 477-6565.
LOS ANGELES – A federal grand jury today returned a 34-count indictment against Jose Huizar, an elected member of the Los Angeles City Council, on charges that he led a criminal enterprise where he used his powerful position at City Hall to enrich himself and his close associates, and unlawfully gave favorable treatment to developers who financed and facilitated bribes and other illicit financial benefits.
The indictment incorporates the allegations made in last month’s criminal complaint that charged Huizar, 51, of Boyle Heights, with one count of conspiracy to violate the Racketeer Influenced and Corrupt Organizations (RICO) Act. The indictment specifically alleges 402 overt acts that Huizar and his co-conspirators committed to further their criminal enterprise, including bribery, honest services fraud, and money laundering.
In addition to the RICO conspiracy charge, the indictment charges Huizar with the following criminal charges: 12 counts of honest services wire fraud; two counts of honest services mail fraud; four counts of traveling interstate in aid of racketeering; six counts of bribery; five counts of money laundering; one count of structuring cash deposits to conceal bribes; one count of making a false statement to a financial institution; one count of making false statements to federal law enforcement; and one count of tax evasion.
Huizar is expected to appear via videoconference for his arraignment, which is scheduled for August 3 in United States District Court.
Huizar has represented Council District 14 (CD-14), which includes downtown Los Angeles and its surrounding communities, since 2005. Huizar for several years was chair of the city’s influential Planning and Land Use Management Committee, a position he lost after the FBI executed search warrants at his city offices and personal residence in November 2018. During the search of his home, agents seized approximately $129,000 cash that was stashed in Huizar’s closet and which, according to the indictment, he received from a Chinese billionaire and another businessperson seeking favors from him.
The indictment alleges that Huizar operated the “CD-14 Enterprise,” along with co-conspirator members, including “Individual 1,” a former general manager of the Los Angeles Department of Building and Safety and former deputy mayor; George Esparza, Huizar’s former special assistant; and real estate development consultant George Chiang. Members and associates of the criminal enterprise referred to Huizar as their “boss,” operated as a criminal organization, and worked together for common purposes, the indictment alleges.
The CD-14 Enterprise allegedly had several objectives, including enriching its members and associates through means that included bribery, extortion, and honest services fraud; advancing its political goals and maintaining its control and authority; concealing the enterprise’s financial activities; and protecting the enterprise by concealing its activities and shielding the enterprise from detection by law enforcement, the city, and the public.
Among the multitude of corruption allegations, the indictment alleges that Huizar illegally accepted more than $800,000 in benefits from Chairman E, a Chinese billionaire who runs a multinational development firm and who owns a hotel in Huizar’s district. Chairman E provided $600,000 in collateral to fund a settlement of a sexual harassment lawsuit filed against Huizar by a former CD-14 staffer, allegations that threatened his 2015 re-election campaign, according to the indictment.
The indictment outlines Huizar’s concealment of illicit benefits, including by instructing his special assistant on how to avoid bank reporting requirements, using his family members to launder hundreds of thousands of dollars in bribes, making false statements on a bank loan application and failing to report his illicit benefits on tax returns and ethics disclosure forms. Huizar allegedly engaged in obstructionist conduct, including attempting to influence other witnesses and lying to federal prosecutors and the FBI.
In total, Huizar allegedly agreed to accept at least $1.5 million in illicit financial benefits.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
The charges of RICO conspiracy, honest services fraud, and money laundering each carry a statutory maximum sentence of 20 years in federal prison. The charge of making false statements to a financial institution has a statutory maximum sentence of 30 years’ imprisonment. The bribery charges each carry a statutory maximum sentence of 10 years in federal prison. The charges of tax evasion, structuring, making false statements to law enforcement, and interstate travel in aid of racketeering have a five-year maximum prison sentence.
Huizar is the fifth person to be charged in the ongoing corruption investigation being conducted by the FBI and the U.S. Attorney’s Office. The other four defendants have pleaded guilty. Esparza, Chiang, and Justin Jangwoo Kim, a Huizar fundraiser who admitted to facilitating bribes, are scheduled to be sentenced by United States District Judge John F. Walter in February 2021. Esparza, Chiang, and Kim are cooperating with the ongoing investigation.
Former Los Angeles City Councilman Mitchell Englander pleaded guilty on July 7 to charges of scheming to falsify material facts related to trips he took to Las Vegas and Palm Springs that were funded by a businessperson. Englander’s sentencing hearing is scheduled for December 7, also before Judge Walter.
The cases against Huizar and his associates in the CD-14 Enterprise are being prosecuted by Assistant United States Attorney Mack E. Jenkins, Chief of the Public Corruption and Civil Rights Section, and Assistant United States Attorneys Veronica Dragalin and Melissa Mills, also of the Public Corruption and Civil Rights Section.
Any member of the public who has information related to this or any other public corruption matter in the City of Los Angeles is encouraged to send information to the FBI’s email tip line at pctips-losangeles@fbi.gov or to contact the FBI’s Los Angeles Field Office at (310) 477-6565.
COMPLAINT
LOS ANGELES – Special agents with the FBI this morning arrested Jose Huizar, an elected member of the Los Angeles City Council, on a federal racketeering charge that alleges he led a criminal enterprise that used his powerful position at City Hall to solicit and accept lucrative bribes and other financial benefits to enrich himself and his close associates in exchange for Huizar taking official actions favorable to the developers and others who financed and facilitated the bribes.
Huizar, 51, of Boyle Heights, was taken into custody at his home without incident and is expected to make his initial appearance this afternoon in United States District Court in downtown Los Angeles.
Huizar was arrested pursuant to a federal criminal complaint filed on June 22 and unsealed this morning. The complaint charges Huizar with one count of conspiring to violate the Racketeer Influenced and Corrupt Organizations (RICO) Act and alleges that, as part of the criminal enterprise, he and his associates violated a series of laws, including bribery, honest services fraud, extortion and money laundering.
“This case pulled back the curtain on rampant corruption at City Hall,” said United States Attorney Nick Hanna. “Councilman Huizar violated the public trust to a staggering degree, allegedly soliciting and accepting hundreds of thousands of dollars in bribes from multiple sources over many years. Using the power of his office to approve or stall large building projects, Huizar worked through a web of other corrupt city officials, lobbyists, consultants and developers to line his pockets and maintain his hold on Council District 14, which he turned into a money-making criminal enterprise that shaped the development landscape in Los Angeles.”
“Mr. Huizar was busy enjoying the fruits of his alleged corruption while his criminal enterprise sold the city to the highest bidder behind the backs of taxpayers,” said Paul Delacourt, the Assistant Director in Charge of the FBI’s Los Angeles Field Office. “As we continue to investigate this case, we urge residents, business owners and city employees to come forward with information about bribery and illegal practices in government. The FBI relies on the cooperation of others to build cases that successfully root out corruption in order to restore integrity in public office.”
Huizar has represented Council District 14 (CD-14), which includes downtown Los Angeles and its surrounding communities, since 2005. In addition to representing an area that has experienced a commercial real estate boom in recent years, Huizar for several years was chair of the city’s influential Planning and Land Use Management Committee, a position he lost after the FBI executed search warrants at his city offices and personal residence in November 2018. During the search of Huizar’s home, agents seized approximately $129,000 cash that was stashed in his closet.
“The federal investigation has revealed that Huizar operated a pay-to-play scheme in the City, utilizing and commodifying the powerful Council seat of CD-14, whereby he solicited and accepted financial benefits from international (primarily Chinese) and domestic developers with projects in the City in exchange for favorable official actions,” according to the affidavit in support of the criminal complaint.
The 116-page affidavit alleges that Huizar operated the “CD-14 Enterprise,” along with co-conspirator members, including “Individual 1,” a former general manager of the Los Angeles Department of Building and Safety and former deputy mayor; George Esparza, Huizar’s former special assistant; and real estate development consultant George Chiang. Members and associates of the criminal enterprise referred to Huizar as their “boss,” operated as a criminal organization, and worked together for common purposes, the complaint alleges. The CD-14 Enterprise allegedly had several objectives, including 1) enriching its members and associates through means that included bribery, extortion, and honest services fraud, 2) advancing its political goals and maintaining its control and authority, 3) concealing the enterprise’s financial activities, and 4) protecting the enterprise by concealing its activities and shielding the enterprise from detection by law enforcement, the city, and the public.
In recent weeks, both Esparza and Chiang agreed to plead guilty to the same RICO charge that Huizar now faces.
The CD-14 Enterprise was created in early 2013 by Huizar and Individual 1 “at a time when each of them faced significant threats to their political and professional careers,” according to the affidavit. Individual 1, who maintained close relationships with Chinese developers, introduced Huizar to “Chairman E,” a Chinese billionaire who runs a multinational development firm and who owns a hotel in Huizar’s district.
In 2014, Individual 1 facilitated an arrangement whereby Chairman E provided $600,000 in collateral to fund a settlement of a sexual harassment lawsuit filed against Huizar by a former CD-14 staffer, allegations that threatened his 2015 re-election campaign. In addition, Huizar directly and indirectly accepted cash and casino gambling chips on more than a dozen lavish trips to Las Vegas – trips that included rides on private jets and stays at luxurious casino villas, one of which cost over $38,000 per night. The complaint also alleges Huizar accepted a trip to Australia and other benefits from Chairman E. In exchange, Chairman E asked for a series of favors from Huizar over time.
Ultimately, Chairman E provided over $800,000 in benefits to Huizar so that Huizar would assist Chairman E’s ambitious plans to redevelop his property in CD-14 and build the tallest building west of the Mississippi River, according to the affidavit.
In a second scheme, “Developer C” agreed to pay a $500,000 cash bribe to secure Huizar’s help in resolving a labor organization’s appeal of a major real estate development which, when resolved, would save the developer millions of dollars. After a middleman, Justin Jangwoo Kim, collected $500,000 cash from Developer C, Kim and Esparza decided to keep some of the money for themselves. Kim pleaded guilty on June 3 to bribery charges and admitted facilitating the bribe from Developer C.
A third major bribery scheme outlined in the affidavit involves “Company D,” another Chinese real estate firm that wanted to develop a large mixed-used project in CD-14. In exchange for Huizar’s support of the project, Company D agreed to hire Huizar “Associate 1” as a consultant to perform work – real estate reports that discussed development opportunities – that actually was completed by Chiang. The affidavit alleges that Company D also financed part of a Huizar family trip to China and agreed to contribute $100,000 to a political action committee that would benefit the campaign of Huizar’s close relative, who Huizar intended to replace him on the City Council after he was termed out in 2020.
Other developers made donations to two PACs that would benefit “Relative A-1’s” campaign in exchange for Huizar taking official action to support their projects, the complaint alleges. One series of donations was made by “Company M” and facilitated by “Executive M,” who allegedly furnished Huizar with opposition research against two female staffers who had sued Huizar for sexual harassment in 2018. With Huizar’s help, Company M was able to get final approval in the fall of 2018 to construct a 35-story project in the Arts District with “minimal” affordable housing units and union labor requirements that saved the company an estimated $14 million, the affidavit alleges. Company M later bragged to its employees that this was a “truly amazing” feat “in a wealthy opinionated hipster community,” according to the affidavit.
The complaint alleges a series of additional corrupt acts, including bribes to Huizar from “Businessperson A,” who wanted to develop business opportunities with Huizar’s help. Businessperson A allegedly provided Huizar a $10,000 monthly cash retainer, $10,000 worth of hotel accommodations on 21 separate occasions, and approximately $18,000 in lavish gifts that included suits, shoes and meals.
Huizar allegedly leveraged his official position to pressure developers to make donations to Relative A-1’s campaign to ensure Huizar’s continued influence in the city and to steer work towards companies linked to his associates, including the law firm that employed Relative A-1, regardless of any legitimate business need.
The complaint affidavit concludes by outlining Huizar’s concealment of illicit benefits, including by instructing his special assistant on how to avoid bank reporting requirements, using his family members to launder hundreds of thousands of dollars in bribes, making false statements on a bank loan application and failing to report his illicit benefits on tax returns and ethics disclosure forms. The complaint also alleges that Huizar engaged in obstructionist conduct, including attempting to influence other witnesses and lying to federal prosecutors and the FBI.
A criminal complaint contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
The RICO conspiracy charge alleged in the complaint carries a statutory maximum sentence of 20 years in federal prison.
The cases against Huizar and his associates in the CD-14 Enterprise are being prosecuted by Assistant United States Attorney Mack E. Jenkins, Chief of the Public Corruption and Civil Rights Section, and Assistant United States Attorneys Veronica Dragalin and Melissa Mills, also of the Public Corruption and Civil Rights Section.
Huizar is the fifth person to be charged in the ongoing corruption investigation being conducted by the FBI and U.S. Attorney’s Office. The other four defendants have agreed to plead guilty.
Chiang is scheduled to plead guilty on June 26 before United States District Judge John F. Walter.
The court has yet to schedule a hearing for Esparza to plead guilty.
Kim is scheduled to be sentenced by Judge Walter on August 17.
Former Los Angeles City Councilman Mitchell Englander is scheduled to plead guilty on July 7 to charges of scheming to falsify material facts related to trips he took to Las Vegas and Palm Springs that were funded by Businessperson A.
Any member of the public who has information related to this or any other public corruption matter in the City of Los Angeles is encouraged to send information to the FBI’s email tip line at pctips-losangeles@fbi.gov or to contact the FBI’s Los Angeles Field Office at (310) 477-6565.
LOS ANGELES – The former special assistant to a member of the Los Angeles City Council has agreed to plead guilty to a federal racketeering charge stemming from a “pay-to-play” bribery scheme where real estate developers and their proxies provided over $1 million in financial benefits, including cash, to the councilmember and others to ensure certain real estate projects received favored treatment.
George Esparza, 33, of Boyle Heights, agreed to plead guilty to one count of conspiring to violate the Racketeer Influenced and Corrupt Organization (RICO) statute.
Esparza was charged with the racketeering offense in a criminal information filed today in United States District Court. In addition to the charging document, federal prosecutors filed a plea agreement in which Esparza committed to entering a guilty plea and agreed to continue cooperating in the ongoing investigation into political corruption in the City of Los Angeles.
In the court documents filed today, Esparza admitted to participating in a criminal enterprise called the Council District A Enterprise (CD-A Enterprise), which was led by his one-time boss, who was chair of the City Council’s Planning and Land Use Management (PLUM) Committee and is described as “Councilmember A.”
“Members and associates of the CD-A Enterprise conspired with one another to facilitate bribery schemes that would provide Councilmember A and other City officials financial benefits and keep Councilmember A in power and maintain the CD-A Enterprise’s political stronghold in the City,” according to the plea agreement.
Esparza admitted that he was a member of the criminal enterprise from early 2013 through November 2018, which is when Esparza began cooperating with federal authorities and after the FBI executed multiple search warrants related to the investigation. According to the plea agreement, during the time of the conspiracy, Esparza and Councilmember A accepted financial benefits and agreed to perform official acts, including:
filing motions and voting on projects, including matters before the City Council;
taking, or not taking, action on the PLUM Committee to influence the approval process and project costs;
negotiating with and exerting pressure on labor unions and other city entities to resolve issues on projects;
exerting pressure on developers with projects pending before the city; and
taking official action to enhance the professional reputation and marketability of businesspersons in Los Angeles.
While a member of the criminal enterprise, Esparza participated in several schemes, he admitted in his plea agreement. One scheme centered on a massive downtown project described as “Project E,” which was being developed by a Chinese company run by a Chinese billionaire called “Chairman E” in court papers.
“Chairman E provided defendant Esparza and Councilmember A financial benefits in over a dozen trips to casinos in Las Vegas and Australia,” according to the plea agreement. “Between June 2014 and January 2018, defendant Esparza personally accepted at least approximately $32,000 in gambling chips, plus flights on private jets and commercial airlines, stays at luxurious hotels, expensive meals and alcohol, spa services, event tickets, and escort services from Chairman E.”
The plea agreement also states that, at the urging of another city official described as “Individual 1,” Chairman E agreed to facilitate a $600,000 payment to help Councilmember A confidentially resolve a sexual harassment lawsuit filed against Councilmember A during a 2014 re-election campaign.
In exchange for the $600,000 from Chairman E, Councilmember A routinely assisted with Chairman E’s requests. For example, Councilmember A introduced and secured the passage of a resolution before the City Council that recognized Chairman E’s “achievements and contributions to the economy of CD-A,” the plea agreement states.
Furthermore, Chairman E provided bribes to Esparza and Councilmember A because Councilmember A was poised to significantly benefit plans to redevelop Property E and “transform it into a 77-story skyscraper, making it the tallest building west of the Mississippi River,” according to the plea agreement. This included meeting with Chairman E and his team to discuss tax rebates and other incentives from the City, as well as Councilmember A providing assistance in hiring a consultant to work on Project E. At one point, Esparza told another member of the CD-A staff that Chairman E had “leverage” over Councilmember A because of the financial benefits Chairman E provided. According to court documents, “Chairman E provided over $1 million in bribes to Councilmember A so that Councilmember A would benefit Chairman E’s plans to redevelop his property in CD-A.”
A second bribery scheme described in the plea agreement centers on Project C and a $500,000 cash bribe funded by Developer C to secure Councilmember A’s help in resolving a labor organization’s appeal, which halted the approval process of the real estate development. This bribe, which was facilitated by political fundraiser Justin Jangwoo Kim, was designed to obtain Councilmember A’s influence “to pressure Labor Organization A to withdraw, abandon, or otherwise lose its appeal opposing Project C,” which would allow the project to move forward and would save Developer C $30 million in development costs, the plea agreement states. Esparza admitted that he played a role in negotiating the bribe, as well as having discussions with representatives of Labor Organization A.
In March, Kim agreed to plead guilty to a bribery charge for his role in this scheme. Esparza admitted that he and Kim kept some of the money paid in 2017 as kickbacks for facilitating the bribe, and that he hid $200,000 in cash for Councilmember A. In mid-2017, Esparza asked an employee of Chairman E to conceal the $200,000, as well as other illicit cash, because Esparza feared law enforcement would search his house and discover the money.
In another scheme related to the criminal enterprise, Esparza admitted accepting money from “Businessman A,” who asked Esparza and Councilmember A to use their official positions to make introductions to developers and advocate that they use Businessperson A’s business. For approximately the first six months of 2017, Esparza accepted monthly cash payments of approximately $8,000 to $10,000, with Businessperson A sometimes paying Esparza in the bathroom during meetings in restaurants, according to the plea agreement. Esparza also went on a Businessman A-funded trip to Las Vegas in June 2017 – a trip also attended by then-City Councilman Mitchell Englander, who also has agreed to plead guilty in this investigation related to lying to the FBI about cash and other benefits received from Businessperson A on that trip.
In his plea agreement, Esparza also admitted to lying to special agents with the FBI during interviews in June and July of 2017 by falsely stating, among other things, that he had no knowledge of any city official helping on a project in exchange for money, gifts or campaign contributions.
The court has not scheduled a date for Esparza to enter his guilty plea. Once he does formally enter the guilty plea, he will face a statutory maximum sentence of 20 years in federal prison.
The case against Esparza is part of an ongoing public corruption investigation being conducted by the FBI and the U.S. Attorney’s Office.
The case against Esparza is being prosecuted by Assistant United States Attorney Mack E. Jenkins, Chief of the Public Corruption and Civil Rights Section, and Assistant United States Attorney Veronica Dragalin of the Public Corruption and Civil Rights Section.
Esparza is the fourth person to agree to plead guilty to a federal felony related to this ongoing investigation. Kim is scheduled to enter his guilty plea on June 3, and Englander is set to plead guilty on June 4. Real estate development consultant George Chiang earlier this month agreed to plead guilty to a RICO charge for participating in the pay-to-play scheme and is set to enter his guilty plea on June 26.
Any member of the public who has information related to this or any other public corruption matter in the City of Los Angeles is encouraged to send information to the FBI’s email tip line at pctips-losangeles@fbi.gov or to contact the FBI’s Los Angeles Field Office at (310) 477-6565.
LOS ANGELES – A real estate development consultant has agreed to plead guilty to a federal racketeering offense for participating in a wide-ranging “pay-to-play” scheme in which developers bribed public officials – including a member of the Los Angeles City Council – to secure official acts that would benefit their projects.
George Chiang, 41, of Granada Hills, agreed to plead guilty to one count of conspiring to violate the Racketeer Influenced and Corrupt Organization (RICO) statute.
Chiang was charged with participating in the RICO conspiracy in a criminal information filed today in United States District Court. In conjunction with the charging document, federal prosecutors also filed a plea agreement in which Chiang agreed to fully cooperate in the government’s ongoing investigation into political corruption in the City of Los Angeles.
In the court documents, Chiang admitted that he participated in a criminal enterprise called the Council District A Enterprise (CD-A Enterprise). The enterprise was led by a member of the Los Angeles City Council and involved individuals engaged in a course of conduct – including bribery and honest services fraud – designed to enrich themselves, to conceal their activities from authorities and the public, and to maintain and advance their political power.
The public officials involved in the CD-A Enterprise received cash; consulting and retainer fees; political contributions; tickets to concerts, shows, and sporting events; and other gifts in exchange for affecting the success of development projects.
In early 2014, Chiang was a real estate broker who was recruited by “Individual 1” – a longtime employee of the City of Los Angeles, who eventually became the Deputy Mayor for Economic Development – to be a consultant who would interface with Chinese companies that were developing real estate projects in Los Angeles, according to court documents.
As he started providing consulting services, Chiang became a close political ally of “Councilmember A,” who was a member of the Planning and Land Use Management Committee and member of the Economic Development Committee, according to court documents. Chiang also became a close ally of Councilmember A’s special assistant. Through these relationships, Chiang developed a business relationship with Justin Jangwoo Kim, a fundraiser for Councilmember A. Kim previously agreed to plead guilty to a bribery offense involving Councilmember A and the special assistant.
“Members and associates of the CD-A Enterprise conspired with one another to facilitate bribery schemes that would provide Councilmember A and other City officials financial benefits and keep members in power to maintain the CD-A Enterprise’s political stronghold in the City,” according to Chiang’s plea agreement. “In exchange, Councilmember A, Individual 1, and members and associates of the CD-A Enterprise, would take official action to ensure certain development projects and CD-A Enterprise associates received favored treatment from the City and thereby secure their bribe-financed influence. In addition, members and associates of the CD-A Enterprise sought political contributions from developers and their proxies (e.g., lobbyists, consultants, etc.) to benefit Councilmember A and his allies in exchange for official acts to benefit those developers and their proxies, including defendant Chiang.”
Chiang’s plea agreement contains a 22-page “factual basis” that details certain activities of the CD-A criminal enterprise. According to the factual basis, Councilmember A accepted bribes from “Company D,” a China-based real estate development company, which employed Chiang as a consultant. Among other things, Company D funneled $66,000 to an associate of Councilmember A and pledged $100,000 to a political action committee to benefit a relative of Councilmember A running for the CD-A seat on the City Council. In exchange, Councilmember A filed motions and voted to approve Company D’s “Project D” at City hearings.
In addition, Chiang agreed to pay Individual 1 a share of the lucrative consulting proceeds he received from Company D in exchange for Individual 1 shepherding Project D through the approval process in Individual 1’s capacity as Deputy Mayor, according to the plea agreement’s factual basis. Individual 1 directly and indirectly accepted more than $100,000 from Chiang for assisting in obtaining approvals for Project D, including by exerting pressure on other City officials who could influence the project’s success, according to court documents.
The court has not scheduled a date for Chiang to enter his guilty plea. Once he does formally enter the guilty plea, he will face a statutory maximum sentence of 20 years in federal prison.
The case against Chiang is part of an ongoing public corruption investigation being conducted by the FBI and the U.S. Attorney’s Office.
Chiang is the third person to agree to plead guilty to a federal felony related to this ongoing investigation. In addition to Kim, former Los Angeles City Councilmember Mitchell Englander has agreed to plead guilty to a charge of scheming to falsify material facts related to his cover up of cash payments and other gifts offered from a Los Angeles businessperson. Kim is scheduled to enter his guilty plea on June 3, and Englander is set to plead guilty on June 4.
Any member of the public who has information related to this or any other public corruption matter in the City of Los Angeles is encouraged to send information to the FBI’s email tip line at pctips-losangeles@fbi.gov or to contact the FBI’s Los Angeles Field Office at (310) 477-6565.
The case against Chiang is being prosecuted by Assistant United States Attorney Mack E. Jenkins, Chief of the Public Corruption and Civil Rights Section, and Assistant United States Attorney Veronica Dragalin of the Public Corruption and Civil Rights Section.
LOS ANGELES – A political fundraiser has agreed to plead guilty to a federal bribery offense for coordinating a $500,000 cash payment that was intended to secure the help of an elected member of the Los Angeles City Council in resolving a labor organization’s appeal of a major real estate development project in the councilmember’s district.
In a plea agreement filed this morning in federal court, Justin Jangwoo Kim, 53, a longtime resident of Hancock Park who recently relocated to Mar Vista, agreed to plead guilty to one count of federal program bribery. In addition to pleading guilty, Kim has agreed to cooperate with an ongoing public corruption investigation being conducted by federal authorities.
According to his plea agreement, Kim is a real estate appraiser and consultant who was one of the top fundraisers for a member of the Los Angeles City Council – “Councilmember A” – who was member of the City’s Planning and Land Use Management Committee (PLUM). Beginning in early 2017, Kim was also a close political ally of Councilmember A’s staff member, who is identified in court documents as “City Staffer A-1.” Kim admitted that he supported Councilmember A’s and City Staffer A-1’s succession plan, including the need to ensure the election of Councilmember A’s relative to the Los Angeles City Council once Councilmember A’s term expired. Kim was motivated to help Councilmember A maintain power because Kim would be poised to financially benefit from potential illicit schemes in Councilmember A’s district.
The bribery scheme was triggered in the summer of 2016, when a labor organization filed an appeal claiming a real estate project violated requirements of the California Environmental Quality Act. The appeal prevented the project from progressing through the city’s approval processes, including approvals by the PLUM Committee and City Council. After the appeal was filed, a person identified as Developer C called Kim and asked him to obtain Councilmember A’s assistance with the appeal on Developer C’s project.
On September 1, 2016, Kim met with Councilmember A, City Staffer A-1, and Developer C at a Korean karaoke establishment in Los Angeles. At this meeting, Councilmember A agreed to help Developer C with resolving the issues related to the project. At a lunch meeting the following day, City Staffer A-1 told Kim that Councilmember A would not help the project for free and that Councilmember A would require a financial benefit in exchange for help ensuring the project moved forward through the city approval process.
During a series of meetings and communications in late 2016 and early 2017, Developer C and Councilmember A – through Kim and City Staffer A-1 – negotiated a $500,000 bribe payment.
In February or March 2017, Developer C met Kim at a commercial building in Los Angeles and gave Kim $400,000 in cash in a paper bag that was intended for Councilmember A, according to the plea agreement. Kim admitted he later gave City Staffer A-1 hundreds of thousands of dollars in cash to deliver to Councilmember A, but kept some cash for himself for facilitating the bribe payment. Around the same time, City Staffer A-1 informed Kim that Councilmember A held up is end of the deal and helped resolve the appeal.
In July 2017, Developer C provided the remaining $100,000 of the agreed-upon $500,000 bribe to be paid to Councilmember A for successfully resolving the appeal. Kim admitted he met with Developer C at an office in Los Angeles and received an additional $100,000 in cash from Developer C, but Kim kept this money for himself.
Kim also admitted in his plea agreement that he made a series of false statements in recorded interviews in May and July of 2017 to FBI agents who were investigating corruption in the City of Los Angeles.
Finally, in his plea agreement, Kim admitted he failed to declare any of the cash he received from Developer C for his role in facilitating the bribery scheme on his federal income tax return for 2017.
Kim has been directed to make his initial appearance in this case on March 31 at 2:00 p.m. in United States District Court in downtown Los Angeles.
Once he enters the guilty plea to the bribery charge, Kim will face a statutory maximum sentence of 10 years in federal prison.
While Kim has agreed to plead guilty to the bribery offense alleged in the criminal information, he does not admit all of the factual allegations contained in that charging document.
The case against Kim is part of an ongoing public corruption investigation being conducted by the FBI and the U.S. Attorney’s Office. Any member of the public who has information related to this or any other public corruption matter related the City of Los Angeles is encouraged to send information to the FBI’s email tip line at pctips-losangeles@fbi.gov or to contact their local FBI Field Office. In Los Angeles, the FBI can be reached 24 hours a day at (310) 477-6565.
This case is being prosecuted by Assistant United States Attorney Mack E. Jenkins, Chief of the Public Corruption and Civil Rights Section, and Assistant United States Attorney Veronica Dragalin, also of the Public Corruption and Civil Rights Section.
Description: The fiscal year of the data file obtained from the AOUSC
Format: YYYY
Description: The code of the federal judicial circuit where the case was located
Format: A2
Description: The code of the federal judicial district where the case was located
Format: A2
Description: The code of the district office where the case was located
Format: A2
Description: Docket number assigned by the district to the case
Format: A7
Description: A unique number assigned to each defendant in a case which cannot be modified by the court
Format: A3
Description: A unique number assigned to each defendant in a case which can be modified by the court
Format: A3
Description: A sequential number indicating whether a case is an original proceeding or a reopen
Format: N5
Description: Case type associated with the current defendant record
Format: A2
Description: A concatenation of district, office, docket number, case type, defendant number, and reopen sequence number
Format: A18
Description: A concatenation of district, office, docket number, case type, and reopen sequence number
Format: A15
Description: The status of the defendant as assigned by the AOUSC
Format: A2
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Format: A1
Description: The date upon which a defendant became a fugitive
Format: YYYYMMDD
Description: The date upon which a fugitive defendant was taken into custody
Format: YYYYMMDD
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Format: YYYYMMDD
Description: The date upon which proceedings in a case commenced on charges pending in the district court where the defendant appeared, or the date of the defendant’s felony-waiver of indictment
Format: YYYYMMDD
Description: A code used to identify the nature of the proceeding
Format: N2
Description: The date when a defendant first appeared before a judicial officer in the district court where a charge was pending
Format: YYYYMMDD
Description: A code indicating the event by which a defendant appeared before a judicial officer in the district court where a charge was pending
Format: A2
Description: A code indicating the type of legal counsel assigned to a defendant
Format: N2
Description: The title and section of the U.S. Code applicable to the offense committed which carried the highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE1
Format: N2
Description: The four digit AO offense code associated with FTITLE1
Format: A4
Description: The four digit D2 offense code associated with FTITLE1
Format: A4
Description: A code indicating the severity associated with FTITLE1
Format: A3
Description: The FIPS code used to indicate the county or parish where an offense was committed
Format: A5
Description: The date of the last action taken on the record
Format: YYYYMMDD
Description: The date upon which judicial proceedings before the court concluded
Format: YYYYMMDD
Description: The date upon which the final sentence is recorded on the docket
Format: YYYYMMDD
Description: The date upon which the case was closed
Format: YYYYMMDD
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Description: A count of defendants filed excluding inter-district transfers
Format: N1
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Format: N1
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Description: A count of defendants terminated excluding interdistrict transfers
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Description: A count of original proceedings terminated
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Description: A count of defendants pending as of the last day of the period excluding long term fugitives
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Description: A sequential number indicating the iteration of the defendant record
Format: N2
Description: The date the record was loaded into the AOUSC’s NewSTATS database
Format: YYYYMMDD
Description: Statistical year ID label on data file obtained from the AOUSC which represents termination year
LOS ANGELES – A Chinese company’s Arcadia subsidiary, established to redevelop a downtown Los Angeles hotel, has agreed to pay $1,050,000 to resolve an investigation into the company’s conduct with public officials in the City of Los Angeles, including bribery, honest services fraud, and foreign and conduit campaign contributions.
A three-year non-prosecution agreement (NPA) with Jia Yuan USA Co., Inc. is the latest development in the ongoing investigation into a wide-ranging “pay-to-play” scheme in which developers bribed Los Angeles city officials to secure official acts to benefit their real estate projects.
The China-based Shenzhen Hazens established Jia Yuan to acquire, operate and redevelop the Los Angeles Luxe City Center Hotel, which it purchased in 2014 for more than $100 million. Jia Yuan “planned a massive redevelopment that would include retail space, residential units, and hotel rooms, valued at approximately $700 million,” according to a “statement of facts” accompanying the NPA.
The NPA was executed on Monday and announced today by United States Attorney Nick Hanna and FBI Assistant Director in Charge Kristi Koons Johnson.
Under the NPA, Jia Yuan will pay the monetary penalty within two weeks and will continue to cooperate with the FBI’s ongoing public corruption probe. The NPA also requires the cooperation of Jia Yuan’s parent company, as well as other Hazens subsidiaries in the Los Angeles-area.
The NPA details several reasons why the government agreed not to prosecute the company for three years, as long as it refrains from any criminal conduct. Those reasons include the company’s timely acceptance of responsibility for its conduct; remedial measures, including terminating George Chiang as a consultant and improving its compliance program; robust and timely cooperation with the investigation, which included proactively providing the government with records located in China and in the personal possession of its chairman, as well as making the chairman available for an interview while he was located outside the reach of U.S. law enforcement; and agreeing to continue to cooperate with the United States Attorney’s Office and the FBI as the agencies continue to investigate and prosecute cases that may touch upon the company’s conduct.
The statement of facts outlines Jia Yuan’s conduct in relation to former Los Angeles City Councilmember Jose Huizar, who faces a trial in June on a 34-count racketeering indictment, and real estate development consultant George Chiang, who is scheduled to be sentenced in February after pleading guilty earlier this year to participating in a Huizar-led racketeering enterprise.
In the statement of facts, Jia Yuan admits a series of acts, including:
a Jia Yuan employee provided Katy Perry concert tickets to Huizar soon after Huizar and “Individual 1” – previously identified as the city’s deputy mayor for economic development – intervened in a compliance issue at a Hazens-owned hotel;
Jia Yuan employees made campaign contributions to several U.S. political candidates, some of which were later reimbursed by the company at the direction of a foreign national, who was prohibited from participating in U.S. elections;
Jia Yuan provided in-kind contributions to several U.S. political candidates by hosting reduced-cost fundraising events at the Luxe Hotel, some of which took place at the direction of a foreign national who was prohibited from participating in U.S. elections;
the chairman of the Hazens companies facilitated an introduction that resulted in a contract that paid indirect bribe payments to Huizar, who, in his official capacity, introduced and voted on a motion to benefit the Luxe Hotel project; and
Chiang organized a Huizar family trip to China that Hazens partially subsidized.
After receiving all of these benefits, Huizar voted to approve the Luxe Hotel project before the city’s Planning and Land Use Management Committee, which he chaired until shortly after federal agents executed search warrants at his Boyle Heights home and city offices in November 2018.
The statement of facts also details how Chiang and Individual 1 asked the Hazens chairman on several occasions to make a $100,000 contribution to a political action committee established to benefit a Huizar relative who was planning to run for his City Council seat. While the chairman did not authorize the donation, Chiang told Huizar that Hazens would make the $100,000 donation, which prompted Huizar to take additional officials acts to approve the Luxe Hotel project.
The NPA does not preclude or limit the investigation or prosecution of individuals, including any current or former Jia Yuan officer, employee or agent.
The matter involving Jia Yuan and the criminal cases stemming from the investigation are being handled by Assistant United States Attorney Mack E. Jenkins, Chief of the Public Corruption and Civil Rights Section, and Assistant United States Attorneys Veronica Dragalin and Melissa J. Mills, also of the Public Corruption and Civil Rights Section.
Any member of the public who has information related to this investigation or any other public corruption matter in the City of Los Angeles is encouraged to send information to the FBI’s email tip line at pctips-losangeles@fbi.gov or to contact the FBI’s Los Angeles Field Office at (310) 477-6565.
LOS ANGELES – A federal grand jury today returned a 34-count indictment against Jose Huizar, an elected member of the Los Angeles City Council, on charges that he led a criminal enterprise where he used his powerful position at City Hall to enrich himself and his close associates, and unlawfully gave favorable treatment to developers who financed and facilitated bribes and other illicit financial benefits.
The indictment incorporates the allegations made in last month’s criminal complaint that charged Huizar, 51, of Boyle Heights, with one count of conspiracy to violate the Racketeer Influenced and Corrupt Organizations (RICO) Act. The indictment specifically alleges 402 overt acts that Huizar and his co-conspirators committed to further their criminal enterprise, including bribery, honest services fraud, and money laundering.
In addition to the RICO conspiracy charge, the indictment charges Huizar with the following criminal charges: 12 counts of honest services wire fraud; two counts of honest services mail fraud; four counts of traveling interstate in aid of racketeering; six counts of bribery; five counts of money laundering; one count of structuring cash deposits to conceal bribes; one count of making a false statement to a financial institution; one count of making false statements to federal law enforcement; and one count of tax evasion.
Huizar is expected to appear via videoconference for his arraignment, which is scheduled for August 3 in United States District Court.
Huizar has represented Council District 14 (CD-14), which includes downtown Los Angeles and its surrounding communities, since 2005. Huizar for several years was chair of the city’s influential Planning and Land Use Management Committee, a position he lost after the FBI executed search warrants at his city offices and personal residence in November 2018. During the search of his home, agents seized approximately $129,000 cash that was stashed in Huizar’s closet and which, according to the indictment, he received from a Chinese billionaire and another businessperson seeking favors from him.
The indictment alleges that Huizar operated the “CD-14 Enterprise,” along with co-conspirator members, including “Individual 1,” a former general manager of the Los Angeles Department of Building and Safety and former deputy mayor; George Esparza, Huizar’s former special assistant; and real estate development consultant George Chiang. Members and associates of the criminal enterprise referred to Huizar as their “boss,” operated as a criminal organization, and worked together for common purposes, the indictment alleges.
The CD-14 Enterprise allegedly had several objectives, including enriching its members and associates through means that included bribery, extortion, and honest services fraud; advancing its political goals and maintaining its control and authority; concealing the enterprise’s financial activities; and protecting the enterprise by concealing its activities and shielding the enterprise from detection by law enforcement, the city, and the public.
Among the multitude of corruption allegations, the indictment alleges that Huizar illegally accepted more than $800,000 in benefits from Chairman E, a Chinese billionaire who runs a multinational development firm and who owns a hotel in Huizar’s district. Chairman E provided $600,000 in collateral to fund a settlement of a sexual harassment lawsuit filed against Huizar by a former CD-14 staffer, allegations that threatened his 2015 re-election campaign, according to the indictment.
The indictment outlines Huizar’s concealment of illicit benefits, including by instructing his special assistant on how to avoid bank reporting requirements, using his family members to launder hundreds of thousands of dollars in bribes, making false statements on a bank loan application and failing to report his illicit benefits on tax returns and ethics disclosure forms. Huizar allegedly engaged in obstructionist conduct, including attempting to influence other witnesses and lying to federal prosecutors and the FBI.
In total, Huizar allegedly agreed to accept at least $1.5 million in illicit financial benefits.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
The charges of RICO conspiracy, honest services fraud, and money laundering each carry a statutory maximum sentence of 20 years in federal prison. The charge of making false statements to a financial institution has a statutory maximum sentence of 30 years’ imprisonment. The bribery charges each carry a statutory maximum sentence of 10 years in federal prison. The charges of tax evasion, structuring, making false statements to law enforcement, and interstate travel in aid of racketeering have a five-year maximum prison sentence.
Huizar is the fifth person to be charged in the ongoing corruption investigation being conducted by the FBI and the U.S. Attorney’s Office. The other four defendants have pleaded guilty. Esparza, Chiang, and Justin Jangwoo Kim, a Huizar fundraiser who admitted to facilitating bribes, are scheduled to be sentenced by United States District Judge John F. Walter in February 2021. Esparza, Chiang, and Kim are cooperating with the ongoing investigation.
Former Los Angeles City Councilman Mitchell Englander pleaded guilty on July 7 to charges of scheming to falsify material facts related to trips he took to Las Vegas and Palm Springs that were funded by a businessperson. Englander’s sentencing hearing is scheduled for December 7, also before Judge Walter.
The cases against Huizar and his associates in the CD-14 Enterprise are being prosecuted by Assistant United States Attorney Mack E. Jenkins, Chief of the Public Corruption and Civil Rights Section, and Assistant United States Attorneys Veronica Dragalin and Melissa Mills, also of the Public Corruption and Civil Rights Section.
Any member of the public who has information related to this or any other public corruption matter in the City of Los Angeles is encouraged to send information to the FBI’s email tip line at pctips-losangeles@fbi.gov or to contact the FBI’s Los Angeles Field Office at (310) 477-6565.
COMPLAINT
LOS ANGELES – Special agents with the FBI this morning arrested Jose Huizar, an elected member of the Los Angeles City Council, on a federal racketeering charge that alleges he led a criminal enterprise that used his powerful position at City Hall to solicit and accept lucrative bribes and other financial benefits to enrich himself and his close associates in exchange for Huizar taking official actions favorable to the developers and others who financed and facilitated the bribes.
Huizar, 51, of Boyle Heights, was taken into custody at his home without incident and is expected to make his initial appearance this afternoon in United States District Court in downtown Los Angeles.
Huizar was arrested pursuant to a federal criminal complaint filed on June 22 and unsealed this morning. The complaint charges Huizar with one count of conspiring to violate the Racketeer Influenced and Corrupt Organizations (RICO) Act and alleges that, as part of the criminal enterprise, he and his associates violated a series of laws, including bribery, honest services fraud, extortion and money laundering.
“This case pulled back the curtain on rampant corruption at City Hall,” said United States Attorney Nick Hanna. “Councilman Huizar violated the public trust to a staggering degree, allegedly soliciting and accepting hundreds of thousands of dollars in bribes from multiple sources over many years. Using the power of his office to approve or stall large building projects, Huizar worked through a web of other corrupt city officials, lobbyists, consultants and developers to line his pockets and maintain his hold on Council District 14, which he turned into a money-making criminal enterprise that shaped the development landscape in Los Angeles.”
“Mr. Huizar was busy enjoying the fruits of his alleged corruption while his criminal enterprise sold the city to the highest bidder behind the backs of taxpayers,” said Paul Delacourt, the Assistant Director in Charge of the FBI’s Los Angeles Field Office. “As we continue to investigate this case, we urge residents, business owners and city employees to come forward with information about bribery and illegal practices in government. The FBI relies on the cooperation of others to build cases that successfully root out corruption in order to restore integrity in public office.”
Huizar has represented Council District 14 (CD-14), which includes downtown Los Angeles and its surrounding communities, since 2005. In addition to representing an area that has experienced a commercial real estate boom in recent years, Huizar for several years was chair of the city’s influential Planning and Land Use Management Committee, a position he lost after the FBI executed search warrants at his city offices and personal residence in November 2018. During the search of Huizar’s home, agents seized approximately $129,000 cash that was stashed in his closet.
“The federal investigation has revealed that Huizar operated a pay-to-play scheme in the City, utilizing and commodifying the powerful Council seat of CD-14, whereby he solicited and accepted financial benefits from international (primarily Chinese) and domestic developers with projects in the City in exchange for favorable official actions,” according to the affidavit in support of the criminal complaint.
The 116-page affidavit alleges that Huizar operated the “CD-14 Enterprise,” along with co-conspirator members, including “Individual 1,” a former general manager of the Los Angeles Department of Building and Safety and former deputy mayor; George Esparza, Huizar’s former special assistant; and real estate development consultant George Chiang. Members and associates of the criminal enterprise referred to Huizar as their “boss,” operated as a criminal organization, and worked together for common purposes, the complaint alleges. The CD-14 Enterprise allegedly had several objectives, including 1) enriching its members and associates through means that included bribery, extortion, and honest services fraud, 2) advancing its political goals and maintaining its control and authority, 3) concealing the enterprise’s financial activities, and 4) protecting the enterprise by concealing its activities and shielding the enterprise from detection by law enforcement, the city, and the public.
In recent weeks, both Esparza and Chiang agreed to plead guilty to the same RICO charge that Huizar now faces.
The CD-14 Enterprise was created in early 2013 by Huizar and Individual 1 “at a time when each of them faced significant threats to their political and professional careers,” according to the affidavit. Individual 1, who maintained close relationships with Chinese developers, introduced Huizar to “Chairman E,” a Chinese billionaire who runs a multinational development firm and who owns a hotel in Huizar’s district.
In 2014, Individual 1 facilitated an arrangement whereby Chairman E provided $600,000 in collateral to fund a settlement of a sexual harassment lawsuit filed against Huizar by a former CD-14 staffer, allegations that threatened his 2015 re-election campaign. In addition, Huizar directly and indirectly accepted cash and casino gambling chips on more than a dozen lavish trips to Las Vegas – trips that included rides on private jets and stays at luxurious casino villas, one of which cost over $38,000 per night. The complaint also alleges Huizar accepted a trip to Australia and other benefits from Chairman E. In exchange, Chairman E asked for a series of favors from Huizar over time.
Ultimately, Chairman E provided over $800,000 in benefits to Huizar so that Huizar would assist Chairman E’s ambitious plans to redevelop his property in CD-14 and build the tallest building west of the Mississippi River, according to the affidavit.
In a second scheme, “Developer C” agreed to pay a $500,000 cash bribe to secure Huizar’s help in resolving a labor organization’s appeal of a major real estate development which, when resolved, would save the developer millions of dollars. After a middleman, Justin Jangwoo Kim, collected $500,000 cash from Developer C, Kim and Esparza decided to keep some of the money for themselves. Kim pleaded guilty on June 3 to bribery charges and admitted facilitating the bribe from Developer C.
A third major bribery scheme outlined in the affidavit involves “Company D,” another Chinese real estate firm that wanted to develop a large mixed-used project in CD-14. In exchange for Huizar’s support of the project, Company D agreed to hire Huizar “Associate 1” as a consultant to perform work – real estate reports that discussed development opportunities – that actually was completed by Chiang. The affidavit alleges that Company D also financed part of a Huizar family trip to China and agreed to contribute $100,000 to a political action committee that would benefit the campaign of Huizar’s close relative, who Huizar intended to replace him on the City Council after he was termed out in 2020.
Other developers made donations to two PACs that would benefit “Relative A-1’s” campaign in exchange for Huizar taking official action to support their projects, the complaint alleges. One series of donations was made by “Company M” and facilitated by “Executive M,” who allegedly furnished Huizar with opposition research against two female staffers who had sued Huizar for sexual harassment in 2018. With Huizar’s help, Company M was able to get final approval in the fall of 2018 to construct a 35-story project in the Arts District with “minimal” affordable housing units and union labor requirements that saved the company an estimated $14 million, the affidavit alleges. Company M later bragged to its employees that this was a “truly amazing” feat “in a wealthy opinionated hipster community,” according to the affidavit.
The complaint alleges a series of additional corrupt acts, including bribes to Huizar from “Businessperson A,” who wanted to develop business opportunities with Huizar’s help. Businessperson A allegedly provided Huizar a $10,000 monthly cash retainer, $10,000 worth of hotel accommodations on 21 separate occasions, and approximately $18,000 in lavish gifts that included suits, shoes and meals.
Huizar allegedly leveraged his official position to pressure developers to make donations to Relative A-1’s campaign to ensure Huizar’s continued influence in the city and to steer work towards companies linked to his associates, including the law firm that employed Relative A-1, regardless of any legitimate business need.
The complaint affidavit concludes by outlining Huizar’s concealment of illicit benefits, including by instructing his special assistant on how to avoid bank reporting requirements, using his family members to launder hundreds of thousands of dollars in bribes, making false statements on a bank loan application and failing to report his illicit benefits on tax returns and ethics disclosure forms. The complaint also alleges that Huizar engaged in obstructionist conduct, including attempting to influence other witnesses and lying to federal prosecutors and the FBI.
A criminal complaint contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
The RICO conspiracy charge alleged in the complaint carries a statutory maximum sentence of 20 years in federal prison.
The cases against Huizar and his associates in the CD-14 Enterprise are being prosecuted by Assistant United States Attorney Mack E. Jenkins, Chief of the Public Corruption and Civil Rights Section, and Assistant United States Attorneys Veronica Dragalin and Melissa Mills, also of the Public Corruption and Civil Rights Section.
Huizar is the fifth person to be charged in the ongoing corruption investigation being conducted by the FBI and U.S. Attorney’s Office. The other four defendants have agreed to plead guilty.
Chiang is scheduled to plead guilty on June 26 before United States District Judge John F. Walter.
The court has yet to schedule a hearing for Esparza to plead guilty.
Kim is scheduled to be sentenced by Judge Walter on August 17.
Former Los Angeles City Councilman Mitchell Englander is scheduled to plead guilty on July 7 to charges of scheming to falsify material facts related to trips he took to Las Vegas and Palm Springs that were funded by Businessperson A.
Any member of the public who has information related to this or any other public corruption matter in the City of Los Angeles is encouraged to send information to the FBI’s email tip line at pctips-losangeles@fbi.gov or to contact the FBI’s Los Angeles Field Office at (310) 477-6565.
LOS ANGELES – The former special assistant to a member of the Los Angeles City Council has agreed to plead guilty to a federal racketeering charge stemming from a “pay-to-play” bribery scheme where real estate developers and their proxies provided over $1 million in financial benefits, including cash, to the councilmember and others to ensure certain real estate projects received favored treatment.
George Esparza, 33, of Boyle Heights, agreed to plead guilty to one count of conspiring to violate the Racketeer Influenced and Corrupt Organization (RICO) statute.
Esparza was charged with the racketeering offense in a criminal information filed today in United States District Court. In addition to the charging document, federal prosecutors filed a plea agreement in which Esparza committed to entering a guilty plea and agreed to continue cooperating in the ongoing investigation into political corruption in the City of Los Angeles.
In the court documents filed today, Esparza admitted to participating in a criminal enterprise called the Council District A Enterprise (CD-A Enterprise), which was led by his one-time boss, who was chair of the City Council’s Planning and Land Use Management (PLUM) Committee and is described as “Councilmember A.”
“Members and associates of the CD-A Enterprise conspired with one another to facilitate bribery schemes that would provide Councilmember A and other City officials financial benefits and keep Councilmember A in power and maintain the CD-A Enterprise’s political stronghold in the City,” according to the plea agreement.
Esparza admitted that he was a member of the criminal enterprise from early 2013 through November 2018, which is when Esparza began cooperating with federal authorities and after the FBI executed multiple search warrants related to the investigation. According to the plea agreement, during the time of the conspiracy, Esparza and Councilmember A accepted financial benefits and agreed to perform official acts, including:
filing motions and voting on projects, including matters before the City Council;
taking, or not taking, action on the PLUM Committee to influence the approval process and project costs;
negotiating with and exerting pressure on labor unions and other city entities to resolve issues on projects;
exerting pressure on developers with projects pending before the city; and
taking official action to enhance the professional reputation and marketability of businesspersons in Los Angeles.
While a member of the criminal enterprise, Esparza participated in several schemes, he admitted in his plea agreement. One scheme centered on a massive downtown project described as “Project E,” which was being developed by a Chinese company run by a Chinese billionaire called “Chairman E” in court papers.
“Chairman E provided defendant Esparza and Councilmember A financial benefits in over a dozen trips to casinos in Las Vegas and Australia,” according to the plea agreement. “Between June 2014 and January 2018, defendant Esparza personally accepted at least approximately $32,000 in gambling chips, plus flights on private jets and commercial airlines, stays at luxurious hotels, expensive meals and alcohol, spa services, event tickets, and escort services from Chairman E.”
The plea agreement also states that, at the urging of another city official described as “Individual 1,” Chairman E agreed to facilitate a $600,000 payment to help Councilmember A confidentially resolve a sexual harassment lawsuit filed against Councilmember A during a 2014 re-election campaign.
In exchange for the $600,000 from Chairman E, Councilmember A routinely assisted with Chairman E’s requests. For example, Councilmember A introduced and secured the passage of a resolution before the City Council that recognized Chairman E’s “achievements and contributions to the economy of CD-A,” the plea agreement states.
Furthermore, Chairman E provided bribes to Esparza and Councilmember A because Councilmember A was poised to significantly benefit plans to redevelop Property E and “transform it into a 77-story skyscraper, making it the tallest building west of the Mississippi River,” according to the plea agreement. This included meeting with Chairman E and his team to discuss tax rebates and other incentives from the City, as well as Councilmember A providing assistance in hiring a consultant to work on Project E. At one point, Esparza told another member of the CD-A staff that Chairman E had “leverage” over Councilmember A because of the financial benefits Chairman E provided. According to court documents, “Chairman E provided over $1 million in bribes to Councilmember A so that Councilmember A would benefit Chairman E’s plans to redevelop his property in CD-A.”
A second bribery scheme described in the plea agreement centers on Project C and a $500,000 cash bribe funded by Developer C to secure Councilmember A’s help in resolving a labor organization’s appeal, which halted the approval process of the real estate development. This bribe, which was facilitated by political fundraiser Justin Jangwoo Kim, was designed to obtain Councilmember A’s influence “to pressure Labor Organization A to withdraw, abandon, or otherwise lose its appeal opposing Project C,” which would allow the project to move forward and would save Developer C $30 million in development costs, the plea agreement states. Esparza admitted that he played a role in negotiating the bribe, as well as having discussions with representatives of Labor Organization A.
In March, Kim agreed to plead guilty to a bribery charge for his role in this scheme. Esparza admitted that he and Kim kept some of the money paid in 2017 as kickbacks for facilitating the bribe, and that he hid $200,000 in cash for Councilmember A. In mid-2017, Esparza asked an employee of Chairman E to conceal the $200,000, as well as other illicit cash, because Esparza feared law enforcement would search his house and discover the money.
In another scheme related to the criminal enterprise, Esparza admitted accepting money from “Businessman A,” who asked Esparza and Councilmember A to use their official positions to make introductions to developers and advocate that they use Businessperson A’s business. For approximately the first six months of 2017, Esparza accepted monthly cash payments of approximately $8,000 to $10,000, with Businessperson A sometimes paying Esparza in the bathroom during meetings in restaurants, according to the plea agreement. Esparza also went on a Businessman A-funded trip to Las Vegas in June 2017 – a trip also attended by then-City Councilman Mitchell Englander, who also has agreed to plead guilty in this investigation related to lying to the FBI about cash and other benefits received from Businessperson A on that trip.
In his plea agreement, Esparza also admitted to lying to special agents with the FBI during interviews in June and July of 2017 by falsely stating, among other things, that he had no knowledge of any city official helping on a project in exchange for money, gifts or campaign contributions.
The court has not scheduled a date for Esparza to enter his guilty plea. Once he does formally enter the guilty plea, he will face a statutory maximum sentence of 20 years in federal prison.
The case against Esparza is part of an ongoing public corruption investigation being conducted by the FBI and the U.S. Attorney’s Office.
The case against Esparza is being prosecuted by Assistant United States Attorney Mack E. Jenkins, Chief of the Public Corruption and Civil Rights Section, and Assistant United States Attorney Veronica Dragalin of the Public Corruption and Civil Rights Section.
Esparza is the fourth person to agree to plead guilty to a federal felony related to this ongoing investigation. Kim is scheduled to enter his guilty plea on June 3, and Englander is set to plead guilty on June 4. Real estate development consultant George Chiang earlier this month agreed to plead guilty to a RICO charge for participating in the pay-to-play scheme and is set to enter his guilty plea on June 26.
Any member of the public who has information related to this or any other public corruption matter in the City of Los Angeles is encouraged to send information to the FBI’s email tip line at pctips-losangeles@fbi.gov or to contact the FBI’s Los Angeles Field Office at (310) 477-6565.
LOS ANGELES – A real estate development consultant has agreed to plead guilty to a federal racketeering offense for participating in a wide-ranging “pay-to-play” scheme in which developers bribed public officials – including a member of the Los Angeles City Council – to secure official acts that would benefit their projects.
George Chiang, 41, of Granada Hills, agreed to plead guilty to one count of conspiring to violate the Racketeer Influenced and Corrupt Organization (RICO) statute.
Chiang was charged with participating in the RICO conspiracy in a criminal information filed today in United States District Court. In conjunction with the charging document, federal prosecutors also filed a plea agreement in which Chiang agreed to fully cooperate in the government’s ongoing investigation into political corruption in the City of Los Angeles.
In the court documents, Chiang admitted that he participated in a criminal enterprise called the Council District A Enterprise (CD-A Enterprise). The enterprise was led by a member of the Los Angeles City Council and involved individuals engaged in a course of conduct – including bribery and honest services fraud – designed to enrich themselves, to conceal their activities from authorities and the public, and to maintain and advance their political power.
The public officials involved in the CD-A Enterprise received cash; consulting and retainer fees; political contributions; tickets to concerts, shows, and sporting events; and other gifts in exchange for affecting the success of development projects.
In early 2014, Chiang was a real estate broker who was recruited by “Individual 1” – a longtime employee of the City of Los Angeles, who eventually became the Deputy Mayor for Economic Development – to be a consultant who would interface with Chinese companies that were developing real estate projects in Los Angeles, according to court documents.
As he started providing consulting services, Chiang became a close political ally of “Councilmember A,” who was a member of the Planning and Land Use Management Committee and member of the Economic Development Committee, according to court documents. Chiang also became a close ally of Councilmember A’s special assistant. Through these relationships, Chiang developed a business relationship with Justin Jangwoo Kim, a fundraiser for Councilmember A. Kim previously agreed to plead guilty to a bribery offense involving Councilmember A and the special assistant.
“Members and associates of the CD-A Enterprise conspired with one another to facilitate bribery schemes that would provide Councilmember A and other City officials financial benefits and keep members in power to maintain the CD-A Enterprise’s political stronghold in the City,” according to Chiang’s plea agreement. “In exchange, Councilmember A, Individual 1, and members and associates of the CD-A Enterprise, would take official action to ensure certain development projects and CD-A Enterprise associates received favored treatment from the City and thereby secure their bribe-financed influence. In addition, members and associates of the CD-A Enterprise sought political contributions from developers and their proxies (e.g., lobbyists, consultants, etc.) to benefit Councilmember A and his allies in exchange for official acts to benefit those developers and their proxies, including defendant Chiang.”
Chiang’s plea agreement contains a 22-page “factual basis” that details certain activities of the CD-A criminal enterprise. According to the factual basis, Councilmember A accepted bribes from “Company D,” a China-based real estate development company, which employed Chiang as a consultant. Among other things, Company D funneled $66,000 to an associate of Councilmember A and pledged $100,000 to a political action committee to benefit a relative of Councilmember A running for the CD-A seat on the City Council. In exchange, Councilmember A filed motions and voted to approve Company D’s “Project D” at City hearings.
In addition, Chiang agreed to pay Individual 1 a share of the lucrative consulting proceeds he received from Company D in exchange for Individual 1 shepherding Project D through the approval process in Individual 1’s capacity as Deputy Mayor, according to the plea agreement’s factual basis. Individual 1 directly and indirectly accepted more than $100,000 from Chiang for assisting in obtaining approvals for Project D, including by exerting pressure on other City officials who could influence the project’s success, according to court documents.
The court has not scheduled a date for Chiang to enter his guilty plea. Once he does formally enter the guilty plea, he will face a statutory maximum sentence of 20 years in federal prison.
The case against Chiang is part of an ongoing public corruption investigation being conducted by the FBI and the U.S. Attorney’s Office.
Chiang is the third person to agree to plead guilty to a federal felony related to this ongoing investigation. In addition to Kim, former Los Angeles City Councilmember Mitchell Englander has agreed to plead guilty to a charge of scheming to falsify material facts related to his cover up of cash payments and other gifts offered from a Los Angeles businessperson. Kim is scheduled to enter his guilty plea on June 3, and Englander is set to plead guilty on June 4.
Any member of the public who has information related to this or any other public corruption matter in the City of Los Angeles is encouraged to send information to the FBI’s email tip line at pctips-losangeles@fbi.gov or to contact the FBI’s Los Angeles Field Office at (310) 477-6565.
The case against Chiang is being prosecuted by Assistant United States Attorney Mack E. Jenkins, Chief of the Public Corruption and Civil Rights Section, and Assistant United States Attorney Veronica Dragalin of the Public Corruption and Civil Rights Section.
Description: The fiscal year of the data file obtained from the AOUSC
Format: YYYY
Description: The code of the federal judicial circuit where the case was located
Format: A2
Description: The code of the federal judicial district where the case was located
Format: A2
Description: The code of the district office where the case was located
Format: A2
Description: Docket number assigned by the district to the case
Format: A7
Description: A unique number assigned to each defendant in a case which cannot be modified by the court
Format: A3
Description: A unique number assigned to each defendant in a case which can be modified by the court
Format: A3
Description: A sequential number indicating whether a case is an original proceeding or a reopen
Format: N5
Description: Case type associated with the current defendant record
Format: A2
Description: A concatenation of district, office, docket number, case type, defendant number, and reopen sequence number
Format: A18
Description: A concatenation of district, office, docket number, case type, and reopen sequence number
Format: A15
Description: The status of the defendant as assigned by the AOUSC
Format: A2
Description: A code indicating the fugitive status of a defendant
Format: A1
Description: The date upon which a defendant became a fugitive
Format: YYYYMMDD
Description: The date upon which a fugitive defendant was taken into custody
Format: YYYYMMDD
Description: The date when a case was first docketed in the district court
Format: YYYYMMDD
Description: The date upon which proceedings in a case commenced on charges pending in the district court where the defendant appeared, or the date of the defendant’s felony-waiver of indictment
Format: YYYYMMDD
Description: A code used to identify the nature of the proceeding
Format: N2
Description: The date when a defendant first appeared before a judicial officer in the district court where a charge was pending
Format: YYYYMMDD
Description: A code indicating the event by which a defendant appeared before a judicial officer in the district court where a charge was pending
Format: A2
Description: A code indicating the type of legal counsel assigned to a defendant
Format: N2
Description: The title and section of the U.S. Code applicable to the offense committed which carried the highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE1
Format: N2
Description: The four digit AO offense code associated with FTITLE1
Format: A4
Description: The four digit D2 offense code associated with FTITLE1
Format: A4
Description: A code indicating the severity associated with FTITLE1
Format: A3
Description: The FIPS code used to indicate the county or parish where an offense was committed
Format: A5
Description: The date of the last action taken on the record
Format: YYYYMMDD
Description: The date upon which judicial proceedings before the court concluded
Format: YYYYMMDD
Description: The date upon which the final sentence is recorded on the docket
Format: YYYYMMDD
Description: The date upon which the case was closed
Format: YYYYMMDD
Description: The total fine imposed at sentencing for all offenses of which the defendant was convicted and a fine was imposed
Format: N8
Description: A count of defendants filed including inter-district transfers
Format: N1
Description: A count of defendants filed excluding inter-district transfers
Format: N1
Description: A count of original proceedings commenced
Format: N1
Description: A count of defendants filed whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants terminated including interdistrict transfers
Format: N1
Description: A count of defendants terminated excluding interdistrict transfers
Format: N1
Description: A count of original proceedings terminated
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Description: A count of defendants terminated whose proceedings commenced by reopen, remand, appeal, or retrial
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Description: A count of defendants pending as of the last day of the period excluding long term fugitives
Format: N1
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Format: A10
Description: A sequential number indicating the iteration of the defendant record
Format: N2
Description: The date the record was loaded into the AOUSC’s NewSTATS database
Format: YYYYMMDD
Description: Statistical year ID label on data file obtained from the AOUSC which represents termination year
LOS ANGELES – A federal grand jury today returned a 34-count indictment against Jose Huizar, an elected member of the Los Angeles City Council, on charges that he led a criminal enterprise where he used his powerful position at City Hall to enrich himself and his close associates, and unlawfully gave favorable treatment to developers who financed and facilitated bribes and other illicit financial benefits.
The indictment incorporates the allegations made in last month’s criminal complaint that charged Huizar, 51, of Boyle Heights, with one count of conspiracy to violate the Racketeer Influenced and Corrupt Organizations (RICO) Act. The indictment specifically alleges 402 overt acts that Huizar and his co-conspirators committed to further their criminal enterprise, including bribery, honest services fraud, and money laundering.
In addition to the RICO conspiracy charge, the indictment charges Huizar with the following criminal charges: 12 counts of honest services wire fraud; two counts of honest services mail fraud; four counts of traveling interstate in aid of racketeering; six counts of bribery; five counts of money laundering; one count of structuring cash deposits to conceal bribes; one count of making a false statement to a financial institution; one count of making false statements to federal law enforcement; and one count of tax evasion.
Huizar is expected to appear via videoconference for his arraignment, which is scheduled for August 3 in United States District Court.
Huizar has represented Council District 14 (CD-14), which includes downtown Los Angeles and its surrounding communities, since 2005. Huizar for several years was chair of the city’s influential Planning and Land Use Management Committee, a position he lost after the FBI executed search warrants at his city offices and personal residence in November 2018. During the search of his home, agents seized approximately $129,000 cash that was stashed in Huizar’s closet and which, according to the indictment, he received from a Chinese billionaire and another businessperson seeking favors from him.
The indictment alleges that Huizar operated the “CD-14 Enterprise,” along with co-conspirator members, including “Individual 1,” a former general manager of the Los Angeles Department of Building and Safety and former deputy mayor; George Esparza, Huizar’s former special assistant; and real estate development consultant George Chiang. Members and associates of the criminal enterprise referred to Huizar as their “boss,” operated as a criminal organization, and worked together for common purposes, the indictment alleges.
The CD-14 Enterprise allegedly had several objectives, including enriching its members and associates through means that included bribery, extortion, and honest services fraud; advancing its political goals and maintaining its control and authority; concealing the enterprise’s financial activities; and protecting the enterprise by concealing its activities and shielding the enterprise from detection by law enforcement, the city, and the public.
Among the multitude of corruption allegations, the indictment alleges that Huizar illegally accepted more than $800,000 in benefits from Chairman E, a Chinese billionaire who runs a multinational development firm and who owns a hotel in Huizar’s district. Chairman E provided $600,000 in collateral to fund a settlement of a sexual harassment lawsuit filed against Huizar by a former CD-14 staffer, allegations that threatened his 2015 re-election campaign, according to the indictment.
The indictment outlines Huizar’s concealment of illicit benefits, including by instructing his special assistant on how to avoid bank reporting requirements, using his family members to launder hundreds of thousands of dollars in bribes, making false statements on a bank loan application and failing to report his illicit benefits on tax returns and ethics disclosure forms. Huizar allegedly engaged in obstructionist conduct, including attempting to influence other witnesses and lying to federal prosecutors and the FBI.
In total, Huizar allegedly agreed to accept at least $1.5 million in illicit financial benefits.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
The charges of RICO conspiracy, honest services fraud, and money laundering each carry a statutory maximum sentence of 20 years in federal prison. The charge of making false statements to a financial institution has a statutory maximum sentence of 30 years’ imprisonment. The bribery charges each carry a statutory maximum sentence of 10 years in federal prison. The charges of tax evasion, structuring, making false statements to law enforcement, and interstate travel in aid of racketeering have a five-year maximum prison sentence.
Huizar is the fifth person to be charged in the ongoing corruption investigation being conducted by the FBI and the U.S. Attorney’s Office. The other four defendants have pleaded guilty. Esparza, Chiang, and Justin Jangwoo Kim, a Huizar fundraiser who admitted to facilitating bribes, are scheduled to be sentenced by United States District Judge John F. Walter in February 2021. Esparza, Chiang, and Kim are cooperating with the ongoing investigation.
Former Los Angeles City Councilman Mitchell Englander pleaded guilty on July 7 to charges of scheming to falsify material facts related to trips he took to Las Vegas and Palm Springs that were funded by a businessperson. Englander’s sentencing hearing is scheduled for December 7, also before Judge Walter.
The cases against Huizar and his associates in the CD-14 Enterprise are being prosecuted by Assistant United States Attorney Mack E. Jenkins, Chief of the Public Corruption and Civil Rights Section, and Assistant United States Attorneys Veronica Dragalin and Melissa Mills, also of the Public Corruption and Civil Rights Section.
Any member of the public who has information related to this or any other public corruption matter in the City of Los Angeles is encouraged to send information to the FBI’s email tip line at pctips-losangeles@fbi.gov or to contact the FBI’s Los Angeles Field Office at (310) 477-6565.
COMPLAINT
LOS ANGELES – Special agents with the FBI this morning arrested Jose Huizar, an elected member of the Los Angeles City Council, on a federal racketeering charge that alleges he led a criminal enterprise that used his powerful position at City Hall to solicit and accept lucrative bribes and other financial benefits to enrich himself and his close associates in exchange for Huizar taking official actions favorable to the developers and others who financed and facilitated the bribes.
Huizar, 51, of Boyle Heights, was taken into custody at his home without incident and is expected to make his initial appearance this afternoon in United States District Court in downtown Los Angeles.
Huizar was arrested pursuant to a federal criminal complaint filed on June 22 and unsealed this morning. The complaint charges Huizar with one count of conspiring to violate the Racketeer Influenced and Corrupt Organizations (RICO) Act and alleges that, as part of the criminal enterprise, he and his associates violated a series of laws, including bribery, honest services fraud, extortion and money laundering.
“This case pulled back the curtain on rampant corruption at City Hall,” said United States Attorney Nick Hanna. “Councilman Huizar violated the public trust to a staggering degree, allegedly soliciting and accepting hundreds of thousands of dollars in bribes from multiple sources over many years. Using the power of his office to approve or stall large building projects, Huizar worked through a web of other corrupt city officials, lobbyists, consultants and developers to line his pockets and maintain his hold on Council District 14, which he turned into a money-making criminal enterprise that shaped the development landscape in Los Angeles.”
“Mr. Huizar was busy enjoying the fruits of his alleged corruption while his criminal enterprise sold the city to the highest bidder behind the backs of taxpayers,” said Paul Delacourt, the Assistant Director in Charge of the FBI’s Los Angeles Field Office. “As we continue to investigate this case, we urge residents, business owners and city employees to come forward with information about bribery and illegal practices in government. The FBI relies on the cooperation of others to build cases that successfully root out corruption in order to restore integrity in public office.”
Huizar has represented Council District 14 (CD-14), which includes downtown Los Angeles and its surrounding communities, since 2005. In addition to representing an area that has experienced a commercial real estate boom in recent years, Huizar for several years was chair of the city’s influential Planning and Land Use Management Committee, a position he lost after the FBI executed search warrants at his city offices and personal residence in November 2018. During the search of Huizar’s home, agents seized approximately $129,000 cash that was stashed in his closet.
“The federal investigation has revealed that Huizar operated a pay-to-play scheme in the City, utilizing and commodifying the powerful Council seat of CD-14, whereby he solicited and accepted financial benefits from international (primarily Chinese) and domestic developers with projects in the City in exchange for favorable official actions,” according to the affidavit in support of the criminal complaint.
The 116-page affidavit alleges that Huizar operated the “CD-14 Enterprise,” along with co-conspirator members, including “Individual 1,” a former general manager of the Los Angeles Department of Building and Safety and former deputy mayor; George Esparza, Huizar’s former special assistant; and real estate development consultant George Chiang. Members and associates of the criminal enterprise referred to Huizar as their “boss,” operated as a criminal organization, and worked together for common purposes, the complaint alleges. The CD-14 Enterprise allegedly had several objectives, including 1) enriching its members and associates through means that included bribery, extortion, and honest services fraud, 2) advancing its political goals and maintaining its control and authority, 3) concealing the enterprise’s financial activities, and 4) protecting the enterprise by concealing its activities and shielding the enterprise from detection by law enforcement, the city, and the public.
In recent weeks, both Esparza and Chiang agreed to plead guilty to the same RICO charge that Huizar now faces.
The CD-14 Enterprise was created in early 2013 by Huizar and Individual 1 “at a time when each of them faced significant threats to their political and professional careers,” according to the affidavit. Individual 1, who maintained close relationships with Chinese developers, introduced Huizar to “Chairman E,” a Chinese billionaire who runs a multinational development firm and who owns a hotel in Huizar’s district.
In 2014, Individual 1 facilitated an arrangement whereby Chairman E provided $600,000 in collateral to fund a settlement of a sexual harassment lawsuit filed against Huizar by a former CD-14 staffer, allegations that threatened his 2015 re-election campaign. In addition, Huizar directly and indirectly accepted cash and casino gambling chips on more than a dozen lavish trips to Las Vegas – trips that included rides on private jets and stays at luxurious casino villas, one of which cost over $38,000 per night. The complaint also alleges Huizar accepted a trip to Australia and other benefits from Chairman E. In exchange, Chairman E asked for a series of favors from Huizar over time.
Ultimately, Chairman E provided over $800,000 in benefits to Huizar so that Huizar would assist Chairman E’s ambitious plans to redevelop his property in CD-14 and build the tallest building west of the Mississippi River, according to the affidavit.
In a second scheme, “Developer C” agreed to pay a $500,000 cash bribe to secure Huizar’s help in resolving a labor organization’s appeal of a major real estate development which, when resolved, would save the developer millions of dollars. After a middleman, Justin Jangwoo Kim, collected $500,000 cash from Developer C, Kim and Esparza decided to keep some of the money for themselves. Kim pleaded guilty on June 3 to bribery charges and admitted facilitating the bribe from Developer C.
A third major bribery scheme outlined in the affidavit involves “Company D,” another Chinese real estate firm that wanted to develop a large mixed-used project in CD-14. In exchange for Huizar’s support of the project, Company D agreed to hire Huizar “Associate 1” as a consultant to perform work – real estate reports that discussed development opportunities – that actually was completed by Chiang. The affidavit alleges that Company D also financed part of a Huizar family trip to China and agreed to contribute $100,000 to a political action committee that would benefit the campaign of Huizar’s close relative, who Huizar intended to replace him on the City Council after he was termed out in 2020.
Other developers made donations to two PACs that would benefit “Relative A-1’s” campaign in exchange for Huizar taking official action to support their projects, the complaint alleges. One series of donations was made by “Company M” and facilitated by “Executive M,” who allegedly furnished Huizar with opposition research against two female staffers who had sued Huizar for sexual harassment in 2018. With Huizar’s help, Company M was able to get final approval in the fall of 2018 to construct a 35-story project in the Arts District with “minimal” affordable housing units and union labor requirements that saved the company an estimated $14 million, the affidavit alleges. Company M later bragged to its employees that this was a “truly amazing” feat “in a wealthy opinionated hipster community,” according to the affidavit.
The complaint alleges a series of additional corrupt acts, including bribes to Huizar from “Businessperson A,” who wanted to develop business opportunities with Huizar’s help. Businessperson A allegedly provided Huizar a $10,000 monthly cash retainer, $10,000 worth of hotel accommodations on 21 separate occasions, and approximately $18,000 in lavish gifts that included suits, shoes and meals.
Huizar allegedly leveraged his official position to pressure developers to make donations to Relative A-1’s campaign to ensure Huizar’s continued influence in the city and to steer work towards companies linked to his associates, including the law firm that employed Relative A-1, regardless of any legitimate business need.
The complaint affidavit concludes by outlining Huizar’s concealment of illicit benefits, including by instructing his special assistant on how to avoid bank reporting requirements, using his family members to launder hundreds of thousands of dollars in bribes, making false statements on a bank loan application and failing to report his illicit benefits on tax returns and ethics disclosure forms. The complaint also alleges that Huizar engaged in obstructionist conduct, including attempting to influence other witnesses and lying to federal prosecutors and the FBI.
A criminal complaint contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
The RICO conspiracy charge alleged in the complaint carries a statutory maximum sentence of 20 years in federal prison.
The cases against Huizar and his associates in the CD-14 Enterprise are being prosecuted by Assistant United States Attorney Mack E. Jenkins, Chief of the Public Corruption and Civil Rights Section, and Assistant United States Attorneys Veronica Dragalin and Melissa Mills, also of the Public Corruption and Civil Rights Section.
Huizar is the fifth person to be charged in the ongoing corruption investigation being conducted by the FBI and U.S. Attorney’s Office. The other four defendants have agreed to plead guilty.
Chiang is scheduled to plead guilty on June 26 before United States District Judge John F. Walter.
The court has yet to schedule a hearing for Esparza to plead guilty.
Kim is scheduled to be sentenced by Judge Walter on August 17.
Former Los Angeles City Councilman Mitchell Englander is scheduled to plead guilty on July 7 to charges of scheming to falsify material facts related to trips he took to Las Vegas and Palm Springs that were funded by Businessperson A.
Any member of the public who has information related to this or any other public corruption matter in the City of Los Angeles is encouraged to send information to the FBI’s email tip line at pctips-losangeles@fbi.gov or to contact the FBI’s Los Angeles Field Office at (310) 477-6565.
LOS ANGELES – The former special assistant to a member of the Los Angeles City Council has agreed to plead guilty to a federal racketeering charge stemming from a “pay-to-play” bribery scheme where real estate developers and their proxies provided over $1 million in financial benefits, including cash, to the councilmember and others to ensure certain real estate projects received favored treatment.
George Esparza, 33, of Boyle Heights, agreed to plead guilty to one count of conspiring to violate the Racketeer Influenced and Corrupt Organization (RICO) statute.
Esparza was charged with the racketeering offense in a criminal information filed today in United States District Court. In addition to the charging document, federal prosecutors filed a plea agreement in which Esparza committed to entering a guilty plea and agreed to continue cooperating in the ongoing investigation into political corruption in the City of Los Angeles.
In the court documents filed today, Esparza admitted to participating in a criminal enterprise called the Council District A Enterprise (CD-A Enterprise), which was led by his one-time boss, who was chair of the City Council’s Planning and Land Use Management (PLUM) Committee and is described as “Councilmember A.”
“Members and associates of the CD-A Enterprise conspired with one another to facilitate bribery schemes that would provide Councilmember A and other City officials financial benefits and keep Councilmember A in power and maintain the CD-A Enterprise’s political stronghold in the City,” according to the plea agreement.
Esparza admitted that he was a member of the criminal enterprise from early 2013 through November 2018, which is when Esparza began cooperating with federal authorities and after the FBI executed multiple search warrants related to the investigation. According to the plea agreement, during the time of the conspiracy, Esparza and Councilmember A accepted financial benefits and agreed to perform official acts, including:
filing motions and voting on projects, including matters before the City Council;
taking, or not taking, action on the PLUM Committee to influence the approval process and project costs;
negotiating with and exerting pressure on labor unions and other city entities to resolve issues on projects;
exerting pressure on developers with projects pending before the city; and
taking official action to enhance the professional reputation and marketability of businesspersons in Los Angeles.
While a member of the criminal enterprise, Esparza participated in several schemes, he admitted in his plea agreement. One scheme centered on a massive downtown project described as “Project E,” which was being developed by a Chinese company run by a Chinese billionaire called “Chairman E” in court papers.
“Chairman E provided defendant Esparza and Councilmember A financial benefits in over a dozen trips to casinos in Las Vegas and Australia,” according to the plea agreement. “Between June 2014 and January 2018, defendant Esparza personally accepted at least approximately $32,000 in gambling chips, plus flights on private jets and commercial airlines, stays at luxurious hotels, expensive meals and alcohol, spa services, event tickets, and escort services from Chairman E.”
The plea agreement also states that, at the urging of another city official described as “Individual 1,” Chairman E agreed to facilitate a $600,000 payment to help Councilmember A confidentially resolve a sexual harassment lawsuit filed against Councilmember A during a 2014 re-election campaign.
In exchange for the $600,000 from Chairman E, Councilmember A routinely assisted with Chairman E’s requests. For example, Councilmember A introduced and secured the passage of a resolution before the City Council that recognized Chairman E’s “achievements and contributions to the economy of CD-A,” the plea agreement states.
Furthermore, Chairman E provided bribes to Esparza and Councilmember A because Councilmember A was poised to significantly benefit plans to redevelop Property E and “transform it into a 77-story skyscraper, making it the tallest building west of the Mississippi River,” according to the plea agreement. This included meeting with Chairman E and his team to discuss tax rebates and other incentives from the City, as well as Councilmember A providing assistance in hiring a consultant to work on Project E. At one point, Esparza told another member of the CD-A staff that Chairman E had “leverage” over Councilmember A because of the financial benefits Chairman E provided. According to court documents, “Chairman E provided over $1 million in bribes to Councilmember A so that Councilmember A would benefit Chairman E’s plans to redevelop his property in CD-A.”
A second bribery scheme described in the plea agreement centers on Project C and a $500,000 cash bribe funded by Developer C to secure Councilmember A’s help in resolving a labor organization’s appeal, which halted the approval process of the real estate development. This bribe, which was facilitated by political fundraiser Justin Jangwoo Kim, was designed to obtain Councilmember A’s influence “to pressure Labor Organization A to withdraw, abandon, or otherwise lose its appeal opposing Project C,” which would allow the project to move forward and would save Developer C $30 million in development costs, the plea agreement states. Esparza admitted that he played a role in negotiating the bribe, as well as having discussions with representatives of Labor Organization A.
In March, Kim agreed to plead guilty to a bribery charge for his role in this scheme. Esparza admitted that he and Kim kept some of the money paid in 2017 as kickbacks for facilitating the bribe, and that he hid $200,000 in cash for Councilmember A. In mid-2017, Esparza asked an employee of Chairman E to conceal the $200,000, as well as other illicit cash, because Esparza feared law enforcement would search his house and discover the money.
In another scheme related to the criminal enterprise, Esparza admitted accepting money from “Businessman A,” who asked Esparza and Councilmember A to use their official positions to make introductions to developers and advocate that they use Businessperson A’s business. For approximately the first six months of 2017, Esparza accepted monthly cash payments of approximately $8,000 to $10,000, with Businessperson A sometimes paying Esparza in the bathroom during meetings in restaurants, according to the plea agreement. Esparza also went on a Businessman A-funded trip to Las Vegas in June 2017 – a trip also attended by then-City Councilman Mitchell Englander, who also has agreed to plead guilty in this investigation related to lying to the FBI about cash and other benefits received from Businessperson A on that trip.
In his plea agreement, Esparza also admitted to lying to special agents with the FBI during interviews in June and July of 2017 by falsely stating, among other things, that he had no knowledge of any city official helping on a project in exchange for money, gifts or campaign contributions.
The court has not scheduled a date for Esparza to enter his guilty plea. Once he does formally enter the guilty plea, he will face a statutory maximum sentence of 20 years in federal prison.
The case against Esparza is part of an ongoing public corruption investigation being conducted by the FBI and the U.S. Attorney’s Office.
The case against Esparza is being prosecuted by Assistant United States Attorney Mack E. Jenkins, Chief of the Public Corruption and Civil Rights Section, and Assistant United States Attorney Veronica Dragalin of the Public Corruption and Civil Rights Section.
Esparza is the fourth person to agree to plead guilty to a federal felony related to this ongoing investigation. Kim is scheduled to enter his guilty plea on June 3, and Englander is set to plead guilty on June 4. Real estate development consultant George Chiang earlier this month agreed to plead guilty to a RICO charge for participating in the pay-to-play scheme and is set to enter his guilty plea on June 26.
Any member of the public who has information related to this or any other public corruption matter in the City of Los Angeles is encouraged to send information to the FBI’s email tip line at pctips-losangeles@fbi.gov or to contact the FBI’s Los Angeles Field Office at (310) 477-6565.
Description: The fiscal year of the data file obtained from the AOUSC
Format: YYYY
Description: The code of the federal judicial circuit where the case was located
Format: A2
Description: The code of the federal judicial district where the case was located
Format: A2
Description: The code of the district office where the case was located
Format: A2
Description: Docket number assigned by the district to the case
Format: A7
Description: A unique number assigned to each defendant in a case which cannot be modified by the court
Format: A3
Description: A unique number assigned to each defendant in a case which can be modified by the court
Format: A3
Description: A sequential number indicating whether a case is an original proceeding or a reopen
Format: N5
Description: Case type associated with the current defendant record
Format: A2
Description: A concatenation of district, office, docket number, case type, defendant number, and reopen sequence number
Format: A18
Description: A concatenation of district, office, docket number, case type, and reopen sequence number
Format: A15
Description: The status of the defendant as assigned by the AOUSC
Format: A2
Description: A code indicating the fugitive status of a defendant
Format: A1
Description: The date upon which a defendant became a fugitive
Format: YYYYMMDD
Description: The date upon which a fugitive defendant was taken into custody
Format: YYYYMMDD
Description: The date when a case was first docketed in the district court
Format: YYYYMMDD
Description: The date upon which proceedings in a case commenced on charges pending in the district court where the defendant appeared, or the date of the defendant’s felony-waiver of indictment
Format: YYYYMMDD
Description: A code used to identify the nature of the proceeding
Format: N2
Description: The date when a defendant first appeared before a judicial officer in the district court where a charge was pending
Format: YYYYMMDD
Description: A code indicating the event by which a defendant appeared before a judicial officer in the district court where a charge was pending
Format: A2
Description: A code indicating the type of legal counsel assigned to a defendant
Format: N2
Description: The title and section of the U.S. Code applicable to the offense committed which carried the highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE1
Format: N2
Description: The four digit AO offense code associated with FTITLE1
Format: A4
Description: The four digit D2 offense code associated with FTITLE1
Format: A4
Description: A code indicating the severity associated with FTITLE1
Format: A3
Description: The FIPS code used to indicate the county or parish where an offense was committed
Format: A5
Description: The date of the last action taken on the record
Format: YYYYMMDD
Description: The date upon which judicial proceedings before the court concluded
Format: YYYYMMDD
Description: The date upon which the final sentence is recorded on the docket
Format: YYYYMMDD
Description: The date upon which the case was closed
Format: YYYYMMDD
Description: The total fine imposed at sentencing for all offenses of which the defendant was convicted and a fine was imposed
Format: N8
Description: A count of defendants filed including inter-district transfers
Format: N1
Description: A count of defendants filed excluding inter-district transfers
Format: N1
Description: A count of original proceedings commenced
Format: N1
Description: A count of defendants filed whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants terminated including interdistrict transfers
Format: N1
Description: A count of defendants terminated excluding interdistrict transfers
Format: N1
Description: A count of original proceedings terminated
Format: N1
Description: A count of defendants terminated whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants pending as of the last day of the period including long term fugitives
Format: N1
Description: A count of defendants pending as of the last day of the period excluding long term fugitives
Format: N1
Description: The source from which the data were loaded into the AOUSC’s NewSTATS database
Format: A10
Description: A sequential number indicating the iteration of the defendant record
Format: N2
Description: The date the record was loaded into the AOUSC’s NewSTATS database
Format: YYYYMMDD
Description: Statistical year ID label on data file obtained from the AOUSC which represents termination year
Preet Bharara, the United States Attorney for the Southern District of New York, Leslie R. Caldwell, Assistant Attorney General of the Criminal Division of the U.S. Department of Justice, Stephen Richardson, Assistant Director of the Criminal Investigative Division of the Federal Bureau of Investigation (“FBI”), and William F. Sweeney Jr., Assistant Director-in-Charge of the New York Field Office of the FBI, announced the unsealing of an Indictment charging JOO HYUN BAHN, a/k/a “Dennis Bahn” (“BAHN”), BAN KI SANG (“BAN”), and MALCOLM HARRIS (“HARRIS”) with violations of the Foreign Corrupt Practices Act (“FCPA”), money laundering, wire fraud, and aggravated identity theft, and the filing of a Complaint charging SANG WOO, a/k/a “John Woo,” with conspiracy to violate the FCPA. The defendants are charged with federal crimes arising out of a corrupt scheme to pay $2.5 million in bribes to a foreign official (“Foreign Official-1”) of a country in the Middle East (“Country-1”) in order to facilitate the sale by South Korean construction company Keangnam Enterprises Co., Ltd. (“Keangnam”) of a 72-story commercial building known as Landmark 72 in Hanoi, Vietnam, to Country-1’s sovereign wealth fund (the “Fund”) for $800 million.
Manhattan U.S. Attorney Preet Bharara said: “The father-son defendants, Ban Ki Sang and Joo Hyun Bahn, allegedly conspired to bribe a foreign official to close an $800 million deal for a 72-story skyscraper in Vietnam, a deal that would have led to a multimillion-dollar commission for the Manhattan real estate broker son and much needed capital for the father’s construction company in Korea. But these alleged schemers were themselves double-crossed, as the man who purportedly set up the bribery scheme, Malcolm Harris, took the bribe money and pocketed it. This alleged bribery and fraud scheme offends all who believe in honest and transparent business, and it stands as a reminder that those who bring international corruption to New York City, as alleged here, will face the scrutiny of American law enforcement.”
Assistant Attorney General Leslie R. Caldwell said: “This alleged conduct proves the adage that there is truly no honor among thieves. The indictment alleges that two defendants wanted to bribe a government official; instead they were defrauded by their co-defendant. Today’s charges are another example of the Criminal Division’s commitment to rooting out all manner of corruption.”
FBI Assistant Director Stephen Richardson said: “Accepting and offering bribes seriously threatens the integrity of a fair and competitive economic system here in the United States and abroad. This case is a testament to the commitment by the FBI and our dedicated International Corruption Squads to combatting foreign corruption that reaches our shores, and these arrests send a strong message that we will not relent in our efforts to uphold the law and hold everyone accountable to play by the same, fair rules.”
FBI Assistant Director William F. Sweeney Jr. said: “When Ban, a senior executive at Keangnam, realized the debts owed to his company’s creditors were mounting, he sought the support of his son Bahn, a broker for a real estate firm in Manhattan. The plan was for Bahn to secure an investor for Landmark 72, and the brokerage agreement they entered into would ultimately secure Bahn a lucrative profit. But instead of lawfully obtaining financing for the deal, they allegedly entered into an illegal agreement with Harris to bribe a foreign official into purchasing the property. In the end, they were hoodwinked by their very own criminal activity.”
According to the allegations contained in the Indictment and the Complaint[1]:
From in or about March 2013 through in or about May 2015, BAHN and his father BAN engaged in an international conspiracy to bribe Foreign Official-1 in connection with the attempted $800 million sale of a building complex in Hanoi, Vietnam, known as Landmark 72. During this time, BAN was a senior executive at Keangnam, a South Korean construction company that built and owned Landmark 72. In early 2013, Keangnam was experiencing a liquidity crisis. The debts owed to Keangnam’s creditors were maturing and the company needed to raise capital. BAN convinced Keangnam to hire his son BAHN, who worked as a broker at a commercial real estate firm in Manhattan, to secure an investor for Landmark 72. Thereafter, Keangnam entered into an exclusive brokerage agreement with BAHN and his firm. If BAHN were successful, he stood to earn a multimillion-dollar commission from Keangnam.
Instead of obtaining financing through legitimate channels, BAHN and BAN engaged in a corrupt scheme to pay bribes to Foreign Official-1, through HARRIS, who held himself out as an agent of Foreign Official-1, to induce Foreign Official-1 to use his influence to convince the Fund to acquire Landmark 72 for approximately $800 million. HARRIS sent BAHN numerous emails purportedly sent by Foreign Official-1 and bearing Foreign Official-1’s name. In or about April 2014, following communications with HARRIS, BAHN and BAN agreed to pay, through HARRIS, a $500,000 upfront bribe and a $2,000,000 bribe upon the close of the sale of Landmark 72 to Foreign Official-1 on behalf of Keangnam. WOO helped BAHN and BAN obtain the $500,000 that was ultimately used to pay the attempted upfront bribe. Unbeknownst to BAHN or BAN, however, HARRIS did not have the claimed relationship with Foreign Official-1 and did not intend to pay the bribe money to Foreign Official-1. Instead, HARRIS simply stole the $500,000 upfront bribe arranged by BAHN and BAN, which HARRIS then spent on lavish personal expenses, including rent for a luxury penthouse apartment in Williamsburg, Brooklyn.
Over approximately the next year, as the Landmark 72 deal showed no signs of actual progress, Keangnam’s liquidity crisis worsened. Believing that the upfront bribe that BAHN and BAN had arranged would eventually bear fruit, and not wanting to lose a potential multimillion-dollar commission, BAHN engaged in a fraudulent scheme to trick Keangnam and its creditors into believing the Fund was close to acquiring Landmark 72. BAHN also stole approximately $225,000 of the $500,000 that Keangnam had advanced BAHN’s firm to cover brokerage expenses. In furtherance of the fraudulent scheme, BAHN repeatedly lied to Keangnam and its creditors about the status of the Landmark 72 deal with the Fund, knowing that Keangnam and its creditors would rely upon the misrepresentations. In addition, BAHN forged emails from Foreign Official-1 and other documents to make the sale of Landmark 72 to the Fund appear imminent to Keangnam and its creditors. Ultimately, when the sale of Landmark 72 to the Fund failed to materialize, Keangnam was forced to enter court receivership in South Korea.
* * *
BAHN was arrested in Tenafly, New Jersey, and WOO was arrested at John F. Kennedy Airport earlier this morning. BAHN and WOO are expected to be presented before U.S. Magistrate Judge Kevin Nathaniel Fox in federal court in Manhattan later today. BAN and HARRIS are currently at large.
The case against BAHN, BAN, and HARRIS is assigned to U.S. District Judge Edgardo Ramos.
BAHN, 38, of Tenafly, New Jersey, and BAN, 69, of Seoul, South Korea, are each charged with one count of conspiracy to violate the FCPA, which carries a maximum sentence of five years in prison; three counts of violating the FCPA, each of which carries a maximum sentence of five years in prison; and one count of conspiracy to commit money laundering and one count of money laundering, each of which carries a maximum sentence of 20 years in prison. In addition, BAHN and HARRIS, 52, of New York, New York, are each charged with one count of wire fraud, which carries a maximum sentence of 20 years in prison; one count of conducting monetary transactions in illegal funds, which carries a maximum sentence of 10 years in prison; and aggravated identity theft, which carries a mandatory consecutive sentence of two years in prison. WOO, 35, of Edgewater, New Jersey, is charged with one count of conspiracy to violate the FCPA, which carries a maximum sentence of five years in prison.
The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencings of the defendants will be determined by the judge.
Mr. Bharara praised the outstanding investigative work of the International Corruption Squad of the FBI’s New York Field Office. Mr. Bharara also thanked the Department of Justice’s Office of International Affairs for its ongoing assistance in this investigation.
The case is being prosecuted by the Office’s Complex Frauds and Cybercrime Unit. Assistant United States Attorney Daniel S. Noble and Trial Attorney Dennis R. Kihm of the Fraud Section of the Justice Department’s Criminal Division are in charge of the prosecution.
The charges contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
[1] As the introductory phase signifies, the entirety of the text of the Indictment and Complaint, and the description of the Indictment and Complaint set forth herein, constitute only allegations, and every fact described should be treated as an allegation.
Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced that NAVNOOR KANG, the former Director of Fixed Income and Head of Portfolio Strategy at the New York State Common Retirement Fund (“NYSCRF”), was sentenced today in Manhattan federal court to 21 months in prison for participating in a massive “pay-to-play” bribery scheme involving the nation’s third largest public pension fund. KANG pled guilty to conspiracy to commit securities fraud and conspiracy to commit honest services wire fraud on November 8, 2017, before U.S. District Judge J. Paul Oetken, who also imposed today’s sentence.
U.S. Attorney Geoffrey S. Berman said: “Combining public corruption with securities fraud, Navnoor Kang betrayed his duty to safeguard public retirement money, bought off with jewelry, cash, drugs, strippers, and prostitutes. His crimes have bought him a prison sentence.”
According to the Indictment charging KANG, other filings in Manhattan federal court, and statements made during the sentencing proceeding:
The NYSCRF is a pension fund administered for the benefit of public employees of the State of New York. From January 2014 through February 2016, KANG served as Director of Fixed Income and Head of Portfolio Strategy for the NYSCRF. In that capacity, KANG was responsible for investing more than $53 billion in fixed-income securities and was entrusted with discretion to manage those investments on behalf of the NYSCRF. KANG owed a fiduciary duty to the NYSCRF and its members and beneficiaries, and was required to make investment decisions in their best interests and free of any conflict of interest. New York State law and NYSCRF policies prohibited KANG and other NYSCRF employees from receiving any bribes, gifts, benefits, or consideration of any kind.
KANG’s Scheme to Steer NYSCRF Fixed-Income Business in Exchange for Secret Bribes
From 2014 through 2016, KANG and others participated in a scheme to defraud the NYSCRF and its members and beneficiaries, and to deprive the NYSCRF of its intangible right to KANG’s honest services. The scheme involved, among other things, an agreement among KANG, Deborah Kelley, a managing director of institutional fixed income sales at a New York-based broker-dealer (“Broker-Dealer-1”), and Gregg Shonhorn, a vice president of fixed income sales at a New York-based broker-dealer (“Broker-Dealer-2”), to pay KANG bribes – in the form of entertainment, travel, lavish meals, prostitutes, nightclub bottle service, narcotics, tickets to sports games and other events, luxury gifts, and cash payments for strippers and KANG’s personal expenses – in exchange for fixed-income business from the NYSCRF. Such bribes – which totaled more than $100,000 – were strictly forbidden by the NYSCRF, and were paid secretly and without any disclosure to the NYSCRF and its members and beneficiaries concerning the conflicts of interest inherent therein.
In exchange for the bribes paid by Kelley, Schonhorn, and others, KANG used his position as Director of Fixed Income and Head of Portfolio Strategy at the NYSCRF to promote the interests of Kelley, Schonhorn, and their respective brokerage firms. KANG steered more than $2 billion in fixed-income business to Broker-Dealer-1 and Broker-Dealer-2, from which Kelley, Schonhorn, and their respective employers earned millions of dollars in commissions from the NYSCRF. In so doing, KANG, with the knowledge and approval of Kelley and Schonhorn, breached his fiduciary duty to make investment decisions in the best interest of the NYSCRF and its members and beneficiaries, and free of conflict, and deprived the NYSCRF of its intangible right to KANG’s honest services.
As the bribes paid by Schonhorn to KANG increased, so too did Broker-Dealer-2’s fixed-income business with the NYSCRF. The value of the NYSCRF’s domestic bond transactions with Broker-Dealer-2 skyrocketed from zero in the fiscal year ending March 31, 2013, to approximately $1.5 million in the fiscal year ending March 31, 2014, to approximately $858 million in the fiscal year ending March 31, 2015, and to approximately $2.378 billion in the fiscal year ending March 31, 2016. Broker-Dealer-2 became the third largest broker-dealer with which the NYSRCF executed domestic bond transactions for the fiscal year ending March 31, 2016, having not even been on the approved list in the fiscal year ending March 31, 2013. As the NYSCRF’s third largest broker-dealer in this asset class, Broker-Dealer-2 brokered approximately eight percent of the total value of the NYSCRF’s domestic bond transactions – a figure greater than that of all but two of the major international banks and brokerage houses on the list. Similarly, the value of NYSCRF’s domestic bond transactions with Broker-Dealer-1 increased from zero in the fiscal year ending March 1, 2014, to approximately $156 million in the fiscal year ending March 1, 2015, and to approximately $179 million in the fiscal year ending March 1, 2016.
KANG’s Obstruction of Justice
In late 2015, the Securities and Exchange Commission (“SEC”) opened an investigation into the entertainment and benefits that Kelley had provided KANG, and the SEC subpoenaed both KANG and Kelley for their testimony. In advance of their testimony, KANG and Kelley agreed to align their stories and each testified falsely under oath before the SEC about expenses Kelley had paid for KANG. Moreover, after a federal grand jury investigation was opened, KANG instructed Schonhorn to testify falsely before the grand jury, and KANG admitted that he had hidden relevant evidence.
* * *
KANG, 39, of Los Angeles, California, was also sentenced to three years of supervised release, ordered to forfeit $ $78,716, and to pay restitution to the NYSCRF in the amount of $242,724.17.
Kelley and Schonhorn have each pled guilty for participating in the scheme. Kelley was sentenced by Judge Oetken to three years of probation.
Mr. Berman praised the investigative work of the Federal Bureau of Investigation. He also thanked the SEC, which filed civil charges against Kang, Kelley, and Schonhorn in a separate civil action, and the Office of Inspector General for the Office of the New York State Comptroller, for their assistance.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Edward A. Imperatore and Joshua A. Naftalis are in charge of the prosecution.
Damian Williams, the United States Attorney for the Southern District of New York, announced today that PABLO RENATO RODRIGUEZ, the co-founder of AirBit Club with GUTEMBERG DOS SANTOS, was sentenced to 12 years in prison for orchestrating the massive global AirBit Club pyramid scheme. RODRIGUEZ and his co-conspirators deceived individuals into investing in AirBit Club, a purported cryptocurrency mining and trading company, and executed a sophisticated money laundering operation to hide their illegal profits pilfered from AirBit Club. RODRIGUEZ’s co-defendants, DOS SANTOS, SCOTT HUGHES, CECILIA MILLAN, and KARINA CHAIREZ have pled guilty and are awaiting sentencing. RODRIGUEZ and his co-defendants collectively have been ordered to forfeit their fraudulent proceeds of AirBit Club, which include seized or restrained assets consisting of U.S. currency, Bitcoin, and real estate currently valued at approximately $100 million. U.S. District Judge George B. Daniels imposed today’s sentence.
U.S. Attorney Damian Williams said: “Rodriguez co-founded and led an international multimillion-dollar pyramid scheme that preyed on mostly unsophisticated investors with false promises that their money was being invested in cryptocurrency trading and mining. Instead of investing on behalf of investors, Rodriguez hid victims’ money in a complex laundering scheme using Bitcoin, an attorney trust account, and international front and shell companies and used victims’ money to line his own pockets. Rodriguez is one of many recent examples of individuals exploiting cryptocurrency to commit fraud, and today’s sentence should deter anyone who may be tempted to defraud others with false promises of cryptocurrency investments.”
According to public court filings and statements made in Court:
RODRIGUEZ and DOS SANTOS co-founded AirBit Club in 2015. They coordinated a scheme in which victim-investors (the “Victims”) were induced to invest in AirBit Club based on the false promise of guaranteed profits in exchange for cash investments in club “memberships” (the “AirBit Club Scheme” or the “Scheme”). AirBit Club, through its founders, RODRIGUEZ and DOS SANTOS, as well as its promoters (the “Promoters”), including MILLAN and CHAIREZ, marketed AirBit Club as a multilevel marketing club in the cryptocurrency industry. Promoters falsely promised Victims that AirBit Club earned returns on cryptocurrency mining and trading and that Victims would earn passive, guaranteed daily returns on any membership purchased.
RODRIGUEZ, DOS SANTOS, HUGHES, MILLAN, and CHAIREZ traveled throughout the United States and around the world to places in Latin America, Asia, and Eastern Europe, where they hosted lavish expos and small community presentations aimed at convincing Victims to purchase AirBit Club memberships. In furtherance of the AirBit Club Scheme, the Victims were fraudulently induced to buy memberships in cash, including in the Southern District of New York. Following a Victim’s investment, a Promoter provided the Victim with access to an online AirBit Club portal to view the purported returns on memberships (the “Online Portal”). While Victims saw “profits” accumulate on their Online Portal, those representations were false; no Bitcoin mining or trading on behalf of Victims in fact took place. Instead, RODRIGUEZ and his co-conspirators enriched themselves and spent Victim money on cars, jewelry, and luxury homes, and financed more extravagant expos to recruit more Victims.
In many instances, as early as 2016, Victims who attempted to withdraw money from the AirBit Club Online Portal and complained to a Promoter were met with excuses, delays, and hidden fees amounting to more than 50% of the Victim’s requested withdrawal, if they were able to make any withdrawal at all. In April 2020, another victim received a notice on the AirBit Club Online Portal that his account was closed – and principal investment lost – due to “execution of financial sustainability Reserve, policy #34 of the AirBit Club Terms and Conditions, due to the economic and financial crisis caused by (COVID-19).” This excuse regarding the COVID-19 pandemic was false.
RODRIGUEZ, DOS SANTOS, HUGHES, CHAIREZ, and MILLAN sought to conceal the AirBit Club Scheme, as well as their respective control of the proceeds of that Scheme, by requesting that Victims purchase memberships in cash, using third-party cryptocurrency brokers, and by laundering the Scheme’s proceeds through several domestic and foreign bank accounts, including an attorney trust account managed by HUGHES (the “Hughes Trust Account”). The Hughes Trust Account was ostensibly intended to maintain custody of HUGHES’s law practice’s client funds. Instead, the Hughes Trust Account was used by RODRIGUEZ, DOS SANTOS, HUGHES, CHAIREZ, and MILLAN to conceal the nature and origin of the AirBit Club Scheme’s illicit proceeds. Through that account, HUGHES directed Victim funds to the personal expenses of RODRIGUEZ, DOS SANTOS, CHAIREZ, MILLAN, and himself, and funded promotional events and sponsorships designed to further promote the AirBit Club Scheme.
Before AirBit Club, RODRIGUEZ and DOS SANTOS were sued by the Securities and Exchange Commission (“SEC”) for perpetrating another pyramid investment scheme known as Vizinova and paid $1.7 million in disgorgement and fines. HUGHES, an attorney licensed to practice law in California, represented RODRIGUEZ and DOS SANTOS in the Vizinova SEC action. HUGHES then aided RODRIGUEZ and DOS SANTOS in perpetrating the AirBit Club Scheme by, among other things, helping to remove negative information about AirBit Club and Vizinova from the internet.
* * *
RODRIGUEZ, 40, of Irvine, California, was also sentenced to three years of supervised release. RODRIGUEZ was further ordered to pay a forfeiture of $65 million and to forfeit various items of property, including: (i) $999,936.22 formerly held in escrow by Insured International Aircraft Title Service LLC for the Gulfstream Jet with Tail Number N370Z and Serial Number 2082; (ii) 1,322.98963846 in BTC seized from various Bitcoin wallets; (iii) $896,483.00 in United States currency seized from RODRIGUEZ’s California residence; (iv) RODRIGUEZ’s residence located at 117 Amber Sky in the City of Irvine, California 92618; (v) various watches and jewelry seized from RODRIGUEZ’s California residence; and (vi) 2,499.997 in BTC seized from various Bitcoin wallets.
DOS SANTOS, 48, of Panama City, Panama, MILLAN, 41, of Greensboro, North Carolina, CHAIREZ, 47, of Modesto, California, and HUGHES, 47, of Newport Beach, California, have pled guilty to charges including wire fraud conspiracy, which carries a maximum potential sentence of 20 years in prison; money laundering conspiracy, which carries a maximum potential sentence of 20 years in prison; and bank fraud conspiracy, which carries a maximum potential sentence of 30 years in prison. MILLAN, CHAIREZ, and HUGHES are scheduled to be sentenced on October 3, 2023. DOS SANTOS is scheduled to be sentenced on October 4, 2023.
Mr. Williams praised the outstanding investigative work of Special Agents from Homeland Security Investigations’ El Dorado Task Force. Mr. Williams further thanked the New York Waterfront Commission for its assistance in the forfeiture process and the attorneys and investigators at the SEC whose expertise and diligence were integral to the development of this investigation.
If you believe you are a victim of the AirBit Club fraud, updated information regarding the case and victims’ rights, as well as contact information for the victim witness coordinator, is available here.
The case is being handled by the Office’s Money Laundering and Transnational Criminal Enterprises Unit. Assistant U.S. Attorneys Kiersten A. Fletcher, Samuel L. Raymond, and Cecilia E. Vogel are in charge of the prosecution.
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, announced today that NAVNOOR KANG, the former Director of Fixed Income and Head of Portfolio Strategy at the New York State Common Retirement Fund (“NYSCRF”), pled guilty today before U.S. District Judge J. Paul Oetken for participating in a massive “pay-for-play” bribery scheme involving the NYSCRF, the nation’s third largest public pension fund.
Acting Manhattan U.S. Attorney Joon H. Kim said: “As an investment professional with New York State Common Retirement Fund, Navnoor Kang owed a duty to the public employees whose pension money he oversaw. But in this case of public corruption meets securities fraud, Kang sold himself and his duty to safeguard public retirement money for luxury vacations, jewelry, cash and even drugs. He has now admitted to his crimes and is a convicted felon. ”
According to allegations contained in the Indictment charging KANG and statements made during his plea proceeding:
The NYSCRF
The NYSCRF is a pension fund administered for the benefit of public employees of the State of New York. From January 2014 through February 2016, KANG served as Director of Fixed Income and Head of Portfolio Strategy for the NYSCRF. In that capacity, KANG was responsible for investing more than $53 billion in fixed-income securities and was entrusted with discretion to manage those investments on behalf of the NYSCRF. KANG owed a fiduciary duty to the NYSCRF and its members and beneficiaries, and was required to make investment decisions in their best interests and free of any conflict of interest. New York State law and NYSCRF policies prohibited KANG and other NYSCRF employees from receiving any bribes, gifts, benefits, or consideration of any kind.
The Scheme to Steer NYSCRF Fixed-Income Business in Exchange for Secret Bribes
From 2014 through 2016, KANG and others participated in a scheme to defraud the NYSCRF and its members and beneficiaries, and to deprive the NYSCRF of its intangible right to KANG’s honest services. The scheme involved, among other things, an agreement among KANG, Deborah Kelley, a managing director of institutional fixed income sales at New York-based broker-dealer (“Broker-Dealer-1”), Gregg Shonhorn, a vice president of fixed income sales at a New York-based broker-dealer (“Broker-Dealer-2”), and others to pay KANG bribes – in the form of entertainment, travel, lavish meals, prostitutes, nightclub bottle service, narcotics, tickets to sports games and other events, luxury gifts, and cash payments for strippers and KANG’s personal expenses – in exchange for fixed-income business from the NYSCRF. Such bribes – which totaled more than $100,000 – were strictly forbidden by the NYSCRF, and were paid secretly and without any disclosure to the NYSCRF and its members and beneficiaries concerning the conflicts of interest inherent therein.
In exchange for the bribes paid by Kelley, Schonhorn, and others, KANG used his position as Director of Fixed Income and Head of Portfolio Strategy at the NYSCRF to promote the interests of Kelley, Schonhorn, and their respective brokerage firms. KANG, in exchange for the bribes he received, agreed to steer fixed-income business to Broker-Dealer-1 and Broker-Dealer-2. In fact, KANG steered more than $3 billion in fixed-income business to Broker-Dealer-1 and Broker-Dealer-2, from which Kelley, Schonhorn, and their respective employers earned millions of dollars in commissions from the NYSCRF. In so doing, KANG, with the knowledge and approval of Kelley and Schonhorn, breached his fiduciary duty to make investment decisions in the best interest of the NYSCRF and its members and beneficiaries, and free of conflict, and deprived the NYSCRF of its intangible right to KANG’s honest services.
As the bribes paid by Schonhorn to KANG increased, so too did Broker-Dealer-2’s fixed-income business with the NYSCRF. The value of the NYSCRF’s domestic bond transactions with Broker-Dealer-2 skyrocketed from zero in the fiscal year ending March 31, 2013, to approximately $1.5 million in the fiscal year ending March 31, 2014, to approximately $858 million in the fiscal year ending March 31, 2015, and to approximately $2.378 billion in the fiscal year ending March 31, 2016. Broker-Dealer-2 became the third largest broker-dealer with which the NYSRCF executed domestic bond transactions for the fiscal year ending March 31, 2016, having not even been on the approved list in the fiscal year ending March 31, 2013. As the NYSCRF’s third largest broker-dealer in this asset class, Broker-Dealer-2 brokered approximately eight percent of the total value of the NYSCRF’s domestic bond transactions – a figure greater than that of all but two of the major international banks and brokerage houses on the list. Similarly, the value of NYSCRF’s domestic bond transactions with Broker-Dealer-1 increased from zero in the fiscal year ending March 1, 2014, to approximately $156 million in the fiscal year ending March 1, 2015, and to approximately $179 million in the fiscal year ending March 1, 2016.
KANG’s trades resulted in the payment of millions of dollars in commissions to Broker-Dealer-1 and Broker-Dealer-2, of which Kelley and Schonhorn personally earned approximately 35 to 40 percent.
The Obstruction of Justice
In late 2015, the Securities and Exchange Commission (“SEC”) opened an investigation into the entertainment and benefits that Kelley had provided KANG, and the SEC subpoenaed both KANG and Kelley for their testimony. In advance of their testimony, KANG and Kelley agreed to align their stories and testify falsely before the SEC in order to conceal their scheme. In late 2015 and early 2016, KANG and Kelley each falsely testified under oath before the SEC about expenses Kelley had paid for KANG. Moreover, after a federal grand jury investigation was opened, KANG instructed Schonhorn to testify falsely before the grand jury, and KANG admitted that he had hidden relevant evidence.
* * *
KANG, 37, of Glendale, California, pled guilty to one count of conspiracy to commit securities fraud, which carries a maximum sentence of five years in prison, and one count of conspiracy to commit honest services wire fraud, which carries a maximum sentence of 20 years in prison. KANG is scheduled to be sentenced on February 23, 2018, by Judge Oetken.
Kelley and Schonhorn have each pled guilty for participating in the scheme. Kelley was sentenced by Judge Oetken to three years of probation.
Mr. Kim praised the investigative work of the Federal Bureau of Investigation and noted that the investigation is continuing. He also thanked the SEC, which filed civil charges against Kang, Kelley, and Schonhorn in a separate civil action, and the Office of Inspector General for the Office of the New York State Comptroller.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Edward A. Imperatore and Joshua A. Naftalis are in charge of the prosecution.
Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced that DAVID SHALAM pleaded guilty today before U.S. Magistrate Judge Sarah Netburn to a Superseding Information charging him with the production of child pornography. U.S. District Court Judge Alvin K. Hellerstein will impose sentencing.
Manhattan U.S. Attorney Geoffrey S. Berman said: “David Shalam paid a woman to perform sex acts via internet video, eventually further urging her to engage in acts of sexual molestation of her own minor children of six and eight years old. Depraved acts such as this can have profoundly damaging effects on victims, the aftermath often leading to years of suffering psychological torment and anguish. Today’s plea holds David Shalam accountable for these reprehensible acts.”
According to the allegations in the Superseding Information, and the Complaint filed on March 9, 2017:
Between April and December 2015, SHALAM paid a woman in Romania (referred to in the Complaint as “Jane Doe”) to participate in a series of live video chats over Skype, during which SHALAM directed Jane Doe to engage in specific sexually explicit conduct with her minor children, who at the time were approximately six and eight years old. SHALAM referred to Jane Doe’s real time sexual abuse of her children as “shows,” at least one of which SHALAM recorded.
In conjunction with Romanian authorities, the FBI recovered logs of instant messages between SHALAM and Jane Doe over Skype, during which SHALAM and Jane Doe discussed the kinds of sex acts SHALAM wanted to see performed, when the children would be home from school so that the “shows” could take place, and the cost of each “show.” SHALAM wired payments to Jane Doe through a Western Union branch in midtown, Manhattan, a few blocks from the office where SHALAM worked for a retail clothing company.
* * *
SHALAM, 51, of Brooklyn, New York, pled guilty to one count of sexual exploitation of minors, which carries a mandatory minimum sentence of fifteen years in prison, and a maximum sentence of thirty years in prison. The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Mr. Berman praised the investigative work of the FBI.
This case is being handled by the Office’s General Crimes Unit. Assistant U.S. Attorneys Alison Moe and Mollie Bracewell are in charge of the prosecution.
Damian Williams, the United States Attorney for the Southern District of New York, Thomas Fattorusso, Special Agent in Charge of the New York Field Office of the Internal Revenue Service, Criminal Investigation (“IRS-CI”), Ricky J. Patel, the Acting Special Agent-in-Charge of the New York Field Office of the Department of Homeland Security (“HSI”), and Daniel B. Brubaker, Inspector-in-Charge of the New York Office of the U.S. Postal Inspection Service (“USPIS”), announced that ETHAN NGUYEN, a/k/a “Frostie,” a/k/a “Jakefiftyeight,” a/k/a “Jobo,” a/k/a “Joboethan,” a/k/a “Meltfrost,” and ANDRE LLACUNA, a/k/a “heyandre,” were charged in a criminal complaint with conspiracy to commit wire fraud and conspiracy to commit money laundering, in connection with a million-dollar scheme to defraud purchasers of NFTs advertised as “Frosties.” Rather than providing the benefits advertised to Frosties NFT purchasers, NGUYEN and LLACUNA transferred the cryptocurrency proceeds of the scheme to various cryptocurrency wallets under their control. Prior to their arrests in Los Angeles, California, NGUYEN and LLACUNA were preparing to launch the sale of a second set of NFTs advertised as “Embers,” which was anticipated to generate approximately $1.5 million in cryptocurrency proceeds.
U.S. Attorney Damian Williams said: “NFTs have been around for several years, but recently mainstream interest has skyrocketed. Where there is money to be made, fraudsters will look for ways to steal it. As we allege, Mr. Nguyen and Mr. Llacuna promised investors the benefits of the Frosties NFTs, but when it sold out, they pulled the rug out from under the victims, almost immediately shutting down the website and transferring the money. Our job as prosecutors and law enforcement is to protect investors from swindlers looking for a payday.”
IRS-CI Special Agent-in-Charge Thomas Fattorusso said: “NFTs represent a new era for financial investments, but the same rules apply to an investment in an NFT or a real estate development. You can’t solicit funds for a business opportunity, abandon that business and abscond with money investors provided you. Our team here at IRS-CI and our partners at HSI closely track cryptocurrency transactions in an effort to uncover alleged schemes like this one.”
HSI Acting Special Agent-in-Charge Ricky J. Patel said: “The trending market and demand for NFT investments has not only drawn the attention of real artists, but scam artists as well. The arrested thieves allegedly hid behind online identities where they promised investors rewards, giveaways, and exclusive opportunities before implementing their ‘rug pull’ scheme – leaving investors with empty pockets and no legitimate investment. HSI New York’s Dark Web & Cryptocurrency Task Force worked closely with our IRS-CI partners to identify and shut down these fraudsters as they prepared to launch the sale of yet another NFT project that would have likely scammed countless others.”
USPIS Inspector-in-Charge Daniel B. Brubaker said: “The rise and popularity of various cryptocurrencies have changed the landscape of buying and selling investments, leading to ample opportunities for new fraud schemes. Today’s arrests involved Non-Fungible Tokens (“NFTs"), opening the door to alternative investment options and substantial risk. These assets may seem like a good deal or a way to become wealthy, but in many cases, as in this situation, only lead to the loss of your money. Postal Inspectors will pursue fraudsters with our law enforcement partners in any consumer market and advise consumers to pursue emerging investment trends with diligence and skepticism."
As alleged in the Complaint[1]:
Since in or about January 2022, IRS-CI and HSI have been investigating a NFT fraud scheme based on reports from purchasers of Frosties utility NFTs[2] that they had been defrauded in what is colloquially referred to as a “rug pull.” As the term suggests, a “rug pull” refers to a scenario where the creator of an NFT and/or gaming project solicits investments and then abruptly abandons a project and fraudulently retains the project investors’ funds. According to the official Frosties website, Frosties purchasers would be eligible for holder rewards, such as, inter alia, giveaways, early access to a metaverse game, and exclusive mint passes to upcoming Frosties seasons. In reality, on or about January 9, 2022, NGUYEN and LLACUNA, whose legal identities were disguised to Frosties NFT purchasers, abruptly abandoned the Frosties NFT project within hours after selling out of Frosties NFTs, deactivated the Frosties website, and transferred approximately $1.1 million in cryptocurrency proceeds from the scheme to various cryptocurrency wallets under their control in multiple transactions designed to obfuscate the original source of funds. A screenshot taken from the Frosties website is shown below:
Prior to their arrests, NGUYEN and LLACUNA were advertising a second NFT project under the name “Embers,” which, based on similarities to the Frosties NFT project, is believed to be another fraud scheme that was expected to launch on or around March 26, 2022. A screenshot taken from the Embers website is shown below:
* * *
ETHAN VINH NGUYEN, 20, and ANDRE MARCUS QUIDDAOEN LLACUNA, 20, are each charged with one count of commit wire fraud, in violation of 18 U.S.C. § 1349, which carries a maximum sentence of 20 years in prison; and one count of conspiracy to commit money laundering, in violation of 18 U.S.C. § 1956(h), which carries a maximum sentence of 20 years in prison.
The maximum potential sentences described above are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants would be determined by the assigned judge.
Mr. Williams praised the outstanding investigative work of HSI, IRS-CI, and USPIS.
The case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant United States Attorney Danielle M. Kudla is in charge of the prosecution.
If you believe that you have been a victim of this crime, please contact HSI Special Agent Paul Nugent at paul.nugent@ice.dhs.gov.
[1] As the introductory phrase signifies, the entirety of the text of the Complaint, and the description of the Complaint set forth herein, constitute only allegations, and every fact described herein should be treated as an allegation as to the defendants charged in the Complaint.
[2] A “utility” NFT offers holders added benefits, such as reward programs, giveaways, and early access to events for NFT holders.
PHILADELPHIA – United States Attorney William M. McSwain announced that Imad Dawara, 39, of Swathmore, PA and Bahaa Dawara, 31, of Woodlyn, PA, who are brothers originally from Syria but now American citizens, were arrested and charged by Indictment on October 16, 2019. During a news conference held today, U.S. Attorney McSwain announced that his Office had unsealed the 10-count Indictment charging the defendants with planning and causing the arson of their business, RCL Management LLC, at 239-241 Chestnut Street in Philadelphia on February 18, 2018 in order to receive insurance proceeds from the destruction.
Specifically, the defendants have been charged with one count of conspiracy to commit arson, one count of conspiracy to use fire to commit a federal felony, one count of malicious damage by means of fire of a building used in interstate commerce, one count of using fire to commit a federal felony, four counts of wire fraud, and two counts of mail fraud. The defendants were arrested yesterday evening at Philadelphia International Airport and are scheduled to appear in U.S. Magistrate Court before Chief Magistrate Judge Linda K. Caracappa at 1:30pm today.
The Indictment alleges that from around December 2012 until February 18, 2018, the defendants owned and operated various restaurants and entertainment establishments in Philadelphia, including a restaurant and hookah lounge at 239-241 Chestnut Street. As the charges lay out, the Dawara brothers were struggling in their Chestnut Street business and had a history of fighting with their landlord. By October 2015, the landlord sent the Dawara brothers a Notice of Default and Breach of Lease, citing numerous violations which included 26 citations from the Pennsylvania State Police Bureau of Liquor Control Enforcement. In response, the charges note that Imad Dawara threatened the landlord that he would destroy the place if the landlord attempted to evict the brothers from the premises.
In November 2015, the Court of Common Pleas of Philadelphia County prohibited the defendants from engaging the services of a disc jockey, providing live entertainment, and allowing the use of tobacco products (including hookah) on the premises unless they had the proper permits. Also in November 2015, their landlord sent the defendants a Notice of Intent to terminate their lease. By October 2017, the Dawara brothers had ceased all business operations for RCL Management at 239-241 Chestnut Street. The brothers attempted to sell their business, but as they had failed to renew their lease or pay rent, no one would buy it. On January 31, 2018, their landlord directed the defendants to vacate the premises by February 2, 2018 and advised the defendants that they owed over $64,000 in overdue payments.
On the same day that the defendants were ordered to vacate the premises, the Indictment alleges that despite no longer doing any business at that location, Imad Dawara contacted an insurance broker to inquire about purchasing insurance for 239-241 Chestnut Street. The Dawara brothers had not held an insurance policy on their business at the Chestnut Street location for over a year, but 16 days before the fire, Imad Dawara purchased insurance. In obtaining this new insurance policy, the charges allege that Imad Dawara asked the insurance broker repeatedly how he would be paid “if there was a fire.” The insurance policy purchased on February 2, 2018 provided coverage in the event of an accidental fire at 239-41 Chestnut Street in the amount of $750,000, which consisted of $500,000 for property damage and $250,000 for business interruption.
On February 18, 2018, at approximately 3:11am, the Indictment alleges that a fire was intentionally started with gasoline in the basement of 239 Chestnut Street, which destroyed the entire building, displaced approximately 160 people – some of whom have never been able to return – closed the 200 block of Chestnut Street for months, and closed numerous businesses, including The Best Western, The Little Lion, Gina’s 45, and Capofitto Pizza & Gelato.
According to the Indictment, both Dawara brothers lied under oath about their whereabouts and activities on the night of the arson. Imad Dawara remained in the office at another business he owns (the B-Side Complex located at 939 N. Delaware Avenue in Philadelphia), while defendant Bahaa Dawara traveled to 239 Chestnut Street to start the fire in the basement.
“No one in Old City will forget when this arson lit up the night sky,” said U.S. Attorney McSwain. “This impacted the heart of our nation’s most historic square mile, which includes Independence Hall and the Liberty Bell Pavilion just blocks away. Many people’s lives were permanently altered, losing their homes and livelihoods. If not for the heroism of the Philadelphia Fire Department, the devastation from that night would have been unthinkable. The City is forever in their debt.”
“Acts of arson are violent crimes that threaten the community. ATF is committed to keeping the public safe from those who maliciously set these fires,” said Special Agent in Charge Donald Robinson. “We appreciate the dedication of the Arson and Explosives Task Force, which includes ATF, the Philadelphia Fire Marshal’s Office, and the Philadelphia Police and Fire Department personnel, who all worked tirelessly from the early morning hours of the arson on February 18, 2018, through the Indictment of the Dawara brothers and right up to yesterday’s arrests. These investigators will continue to tirelessly work this investigation in order to provide justice for the victims, and to hold those who are responsible, accountable for their actions. I would also like to thank the Department of Homeland Security and the United States Customs and Border Protection for their assistance with the arrests at the Philadelphia International Airport, along with the Taxi and Limousine Enforcement Division of the Philadelphia Parking Authority for their assistance.”
If convicted, the defendants face a maximum possible sentence of 20 years’ imprisonment.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) Philadelphia, the Philadelphia Fire Marshal, and the Philadelphia Police Department, with assistance from the Philadelphia Parking Authority Taxi and Limousine Division, and is being prosecuted by Assistant United States Attorney Jeanine Linehan.
An Indictment, Information, or Criminal Complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
Description: The fiscal year of the data file obtained from the AOUSC
Format: YYYY
Description: The code of the federal judicial circuit where the case was located
Format: A2
Description: The code of the federal judicial district where the case was located
Format: A2
Description: The code of the district office where the case was located
Format: A2
Description: Docket number assigned by the district to the case
Format: A7
Description: A unique number assigned to each defendant in a case which cannot be modified by the court
Format: A3
Description: A unique number assigned to each defendant in a case which can be modified by the court
Format: A3
Description: A sequential number indicating whether a case is an original proceeding or a reopen
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Description: Case type associated with the current defendant record
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Description: A concatenation of district, office, docket number, case type, and reopen sequence number
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Description: The date upon which a defendant became a fugitive
Format: YYYYMMDD
Description: The date upon which a fugitive defendant was taken into custody
Format: YYYYMMDD
Description: The date when a case was first docketed in the district court
Format: YYYYMMDD
Description: The date upon which proceedings in a case commenced on charges pending in the district court where the defendant appeared, or the date of the defendant’s felony-waiver of indictment
Format: YYYYMMDD
Description: A code used to identify the nature of the proceeding
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Description: The date when a defendant first appeared before a judicial officer in the district court where a charge was pending
Format: YYYYMMDD
Description: A code indicating the type of legal counsel assigned to a defendant
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Description: The title and section of the U.S. Code applicable to the offense committed which carried the highest severity
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Description: A code indicating the level of offense associated with FTITLE1
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Description: The four digit AO offense code associated with FTITLE1
Format: A4
Description: The four digit D2 offense code associated with FTITLE1
Format: A4
Description: A code indicating the severity associated with FTITLE1
Format: A3
Description: The title and section of the U.S. Code applicable to the offense committed which carried the second highest severity
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Description: The four digit AO offense code associated with FTITLE2
Format: A4
Description: The four digit D2 offense code associated with FTITLE2
Format: A4
Description: A code indicating the severity associated with FTITLE2
Format: A3
Description: The title and section of the U.S. Code applicable to the offense committed which carried the third highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE3
Format: N2
Description: The four digit AO offense code associated with FTITLE3
Format: A4
Description: The four digit D2 offense code associated with FTITLE3
Format: A4
Description: A code indicating the severity associated with FTITLE3
Format: A3
Description: The title and section of the U.S. Code applicable to the offense committed which carried the fourth highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE4
Format: N2
Description: The four digit AO offense code associated with FTITLE4
Format: A4
Description: The four digit D2 offense code associated with FTITLE4
Format: A4
Description: A code indicating the severity associated with FTITLE4
Format: A3
Description: The title and section of the U.S. Code applicable to the offense committed which carried the fifth highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE5
Format: N2
Description: The four digit AO offense code associated with FTITLE5
Format: A4
Description: The four digit D2 offense code associated with FTITLE5
Format: A4
Description: A code indicating the severity associated with FTITLE5
Format: A3
Description: The FIPS code used to indicate the county or parish where an offense was committed
Format: A5
Description: The date of the last action taken on the record
Format: YYYYMMDD
Description: The date upon which judicial proceedings before the court concluded
Format: YYYYMMDD
Description: The date upon which the final sentence is recorded on the docket
Format: YYYYMMDD
Description: The date upon which the case was closed
Format: YYYYMMDD
Description: The total fine imposed at sentencing for all offenses of which the defendant was convicted and a fine was imposed
Format: N8
Description: A count of defendants filed including inter-district transfers
Format: N1
Description: A count of defendants filed excluding inter-district transfers
Format: N1
Description: A count of original proceedings commenced
Format: N1
Description: A count of defendants filed whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
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Format: N1
Description: A count of defendants terminated excluding interdistrict transfers
Format: N1
Description: A count of original proceedings terminated
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Description: A count of defendants terminated whose proceedings commenced by reopen, remand, appeal, or retrial
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Format: N1
Description: A count of defendants pending as of the last day of the period excluding long term fugitives
Format: N1
Description: The source from which the data were loaded into the AOUSC’s NewSTATS database
Format: A10
Description: A sequential number indicating the iteration of the defendant record
Format: N2
Description: The date the record was loaded into the AOUSC’s NewSTATS database
Format: YYYYMMDD
Description: Statistical year ID label on data file obtained from the AOUSC which represents termination year
PHILADELPHIA – United States Attorney William M. McSwain announced that Imad Dawara, 39, of Swarthmore, PA and Bahaa Dawara, 31, of Woodlyn, PA, were charged by Indictment today with conspiracy to defraud the United States by evading the assessment of their income tax liabilities from 2015-2017. This Indictment is the second Indictment charging the brothers in criminal activities. On July 18, 2019, a grand jury returned a 10-count Indictment charging both Dawara brothers with planning and causing the arson of their business at 239-241 Chestnut Street in Philadelphia on February 18, 2018 in order to receive insurance proceeds from the destruction, as well as mail and wire fraud.
Today’s Indictment alleges that the defendants co-owned and operated multiple businesses including B-Side Complex, a nightclub and hookah lounge located at 927 North Delaware Avenue, Noche, and Baba Restaurant, which generated income that they concealed from the IRS by underreporting the gross receipts of the businesses. The defendants are both currently in federal prison because of the July 2019 Indictment for arson and fraud.
“As alleged in this Indictment, the Dawara brothers were engaged in illegal financial schemes associated with the businesses they owned and operated in Philadelphia,” said U.S. Attorney McSwain. “This second Indictment demonstrates my Office’s commitment to investigating and prosecuting all types of harm perpetrated against the government and the community at large. The investigation in this case may have begun with the arson on Chestnut Street, but it didn’t end there. We will pursue every facet of this case until justice has been served.”
If convicted, each defendant faces a maximum possible sentence of five years’ imprisonment, a $250,000 fine, and three years of supervised release.
The case was investigated by Internal Revenue Service, and is being prosecuted by Assistant United States Attorneys Jeanine M. Linehan and Katherine E. Driscoll.
An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
PHILADELPHIA – United States Attorney William M. McSwain announced that Imad Dawara, 39, of Swathmore, PA and Bahaa Dawara, 31, of Woodlyn, PA, who are brothers originally from Syria but now American citizens, were arrested and charged by Indictment on October 16, 2019. During a news conference held today, U.S. Attorney McSwain announced that his Office had unsealed the 10-count Indictment charging the defendants with planning and causing the arson of their business, RCL Management LLC, at 239-241 Chestnut Street in Philadelphia on February 18, 2018 in order to receive insurance proceeds from the destruction.
Specifically, the defendants have been charged with one count of conspiracy to commit arson, one count of conspiracy to use fire to commit a federal felony, one count of malicious damage by means of fire of a building used in interstate commerce, one count of using fire to commit a federal felony, four counts of wire fraud, and two counts of mail fraud. The defendants were arrested yesterday evening at Philadelphia International Airport and are scheduled to appear in U.S. Magistrate Court before Chief Magistrate Judge Linda K. Caracappa at 1:30pm today.
The Indictment alleges that from around December 2012 until February 18, 2018, the defendants owned and operated various restaurants and entertainment establishments in Philadelphia, including a restaurant and hookah lounge at 239-241 Chestnut Street. As the charges lay out, the Dawara brothers were struggling in their Chestnut Street business and had a history of fighting with their landlord. By October 2015, the landlord sent the Dawara brothers a Notice of Default and Breach of Lease, citing numerous violations which included 26 citations from the Pennsylvania State Police Bureau of Liquor Control Enforcement. In response, the charges note that Imad Dawara threatened the landlord that he would destroy the place if the landlord attempted to evict the brothers from the premises.
In November 2015, the Court of Common Pleas of Philadelphia County prohibited the defendants from engaging the services of a disc jockey, providing live entertainment, and allowing the use of tobacco products (including hookah) on the premises unless they had the proper permits. Also in November 2015, their landlord sent the defendants a Notice of Intent to terminate their lease. By October 2017, the Dawara brothers had ceased all business operations for RCL Management at 239-241 Chestnut Street. The brothers attempted to sell their business, but as they had failed to renew their lease or pay rent, no one would buy it. On January 31, 2018, their landlord directed the defendants to vacate the premises by February 2, 2018 and advised the defendants that they owed over $64,000 in overdue payments.
On the same day that the defendants were ordered to vacate the premises, the Indictment alleges that despite no longer doing any business at that location, Imad Dawara contacted an insurance broker to inquire about purchasing insurance for 239-241 Chestnut Street. The Dawara brothers had not held an insurance policy on their business at the Chestnut Street location for over a year, but 16 days before the fire, Imad Dawara purchased insurance. In obtaining this new insurance policy, the charges allege that Imad Dawara asked the insurance broker repeatedly how he would be paid “if there was a fire.” The insurance policy purchased on February 2, 2018 provided coverage in the event of an accidental fire at 239-41 Chestnut Street in the amount of $750,000, which consisted of $500,000 for property damage and $250,000 for business interruption.
On February 18, 2018, at approximately 3:11am, the Indictment alleges that a fire was intentionally started with gasoline in the basement of 239 Chestnut Street, which destroyed the entire building, displaced approximately 160 people – some of whom have never been able to return – closed the 200 block of Chestnut Street for months, and closed numerous businesses, including The Best Western, The Little Lion, Gina’s 45, and Capofitto Pizza & Gelato.
According to the Indictment, both Dawara brothers lied under oath about their whereabouts and activities on the night of the arson. Imad Dawara remained in the office at another business he owns (the B-Side Complex located at 939 N. Delaware Avenue in Philadelphia), while defendant Bahaa Dawara traveled to 239 Chestnut Street to start the fire in the basement.
“No one in Old City will forget when this arson lit up the night sky,” said U.S. Attorney McSwain. “This impacted the heart of our nation’s most historic square mile, which includes Independence Hall and the Liberty Bell Pavilion just blocks away. Many people’s lives were permanently altered, losing their homes and livelihoods. If not for the heroism of the Philadelphia Fire Department, the devastation from that night would have been unthinkable. The City is forever in their debt.”
“Acts of arson are violent crimes that threaten the community. ATF is committed to keeping the public safe from those who maliciously set these fires,” said Special Agent in Charge Donald Robinson. “We appreciate the dedication of the Arson and Explosives Task Force, which includes ATF, the Philadelphia Fire Marshal’s Office, and the Philadelphia Police and Fire Department personnel, who all worked tirelessly from the early morning hours of the arson on February 18, 2018, through the Indictment of the Dawara brothers and right up to yesterday’s arrests. These investigators will continue to tirelessly work this investigation in order to provide justice for the victims, and to hold those who are responsible, accountable for their actions. I would also like to thank the Department of Homeland Security and the United States Customs and Border Protection for their assistance with the arrests at the Philadelphia International Airport, along with the Taxi and Limousine Enforcement Division of the Philadelphia Parking Authority for their assistance.”
If convicted, the defendants face a maximum possible sentence of 20 years’ imprisonment.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) Philadelphia, the Philadelphia Fire Marshal, and the Philadelphia Police Department, with assistance from the Philadelphia Parking Authority Taxi and Limousine Division, and is being prosecuted by Assistant United States Attorney Jeanine Linehan.
An Indictment, Information, or Criminal Complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
Description: The fiscal year of the data file obtained from the AOUSC
Format: YYYY
Description: The code of the federal judicial circuit where the case was located
Format: A2
Description: The code of the federal judicial district where the case was located
Format: A2
Description: The code of the district office where the case was located
Format: A2
Description: Docket number assigned by the district to the case
Format: A7
Description: A unique number assigned to each defendant in a case which cannot be modified by the court
Format: A3
Description: A unique number assigned to each defendant in a case which can be modified by the court
Format: A3
Description: A sequential number indicating whether a case is an original proceeding or a reopen
Format: N5
Description: Case type associated with the current defendant record
Format: A2
Description: A concatenation of district, office, docket number, case type, defendant number, and reopen sequence number
Format: A18
Description: A concatenation of district, office, docket number, case type, and reopen sequence number
Format: A15
Description: The status of the defendant as assigned by the AOUSC
Format: A2
Description: A code indicating the fugitive status of a defendant
Format: A1
Description: The date upon which a defendant became a fugitive
Format: YYYYMMDD
Description: The date upon which a fugitive defendant was taken into custody
Format: YYYYMMDD
Description: The date when a case was first docketed in the district court
Format: YYYYMMDD
Description: The date upon which proceedings in a case commenced on charges pending in the district court where the defendant appeared, or the date of the defendant’s felony-waiver of indictment
Format: YYYYMMDD
Description: A code used to identify the nature of the proceeding
Format: N2
Description: The date when a defendant first appeared before a judicial officer in the district court where a charge was pending
Format: YYYYMMDD
Description: A code indicating the event by which a defendant appeared before a judicial officer in the district court where a charge was pending
Format: A2
Description: A code indicating the type of legal counsel assigned to a defendant
Format: N2
Description: The title and section of the U.S. Code applicable to the offense committed which carried the highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE1
Format: N2
Description: The four digit AO offense code associated with FTITLE1
Format: A4
Description: The four digit D2 offense code associated with FTITLE1
Format: A4
Description: A code indicating the severity associated with FTITLE1
Format: A3
Description: The FIPS code used to indicate the county or parish where an offense was committed
Format: A5
Description: The date of the last action taken on the record
Format: YYYYMMDD
Description: The date upon which judicial proceedings before the court concluded
Format: YYYYMMDD
Description: The date upon which the final sentence is recorded on the docket
Format: YYYYMMDD
Description: The date upon which the case was closed
Format: YYYYMMDD
Description: The total fine imposed at sentencing for all offenses of which the defendant was convicted and a fine was imposed
Format: N8
Description: A count of defendants filed including inter-district transfers
Format: N1
Description: A count of defendants filed excluding inter-district transfers
Format: N1
Description: A count of original proceedings commenced
Format: N1
Description: A count of defendants filed whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants terminated including interdistrict transfers
Format: N1
Description: A count of defendants terminated excluding interdistrict transfers
Format: N1
Description: A count of original proceedings terminated
Format: N1
Description: A count of defendants terminated whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants pending as of the last day of the period including long term fugitives
Format: N1
Description: A count of defendants pending as of the last day of the period excluding long term fugitives
Format: N1
Description: The source from which the data were loaded into the AOUSC’s NewSTATS database
Format: A10
Description: A sequential number indicating the iteration of the defendant record
Format: N2
Description: The date the record was loaded into the AOUSC’s NewSTATS database
Format: YYYYMMDD
Description: Statistical year ID label on data file obtained from the AOUSC which represents termination year
COLUMBUS, Ohio – A Columbus man pleaded guilty in U.S. District Court today to crimes related to sexually exploiting and sextorting more than 25 known victims in at least three states.
Lorenzo A. Winfield, 22, of Columbus, pleaded guilty to sexually exploiting minors, possessing child pornography and communicating interstate with the intent to extort. As part of his plea, the parties involved have recommended a sentence of 23 to 27 years in prison.
According to court documents, from at least 2016 until 2021, Winfield used extortion to solicit and collect explicit photos of underage girls at his Columbus high school, the Arts and College Preparatory Academy (ACPA), where he was known as the “ACPA Hacker”.
Winfield would contact students at ACPA and demand nude photographs of them. He would also hack into victims’ social media accounts and use the photos he obtained against them. Winfield would further tell the victims he had nude photos of them or other students that he would distribute to friends or family unless the victims complied. On numerous occasions, Winfield followed through on these threats, distributing sexually explicit photos of his victims to others to prove he was serious with his threats in a bid to contain more content. In addition, Winfield told the victims to send him sexually explicit images or videos in order to regain control of their own social media accounts.
Winfield used several social media accounts of his own to participate in the exploitation and extortion of the victims that have been identified thus far. His accounts were active across platforms such as Discord, Facebook, Instagram, Snapchat, Skype and Google Hangouts.
Winfield was separately investigated by the FBI Washington Field Office for extorting and exploiting at least four victims in Fairfax and Prince William counties in Virginia.
For example, one identified victim was approximately 11 years old at the time Winfield first made contact with her. Winfield sent nude photos of the victim to students at a Virginia middle school and eventually, as she got older, to students at her high school. The victim originally met Winfield via a social media game. Winfield threatened to harm her family if she did not comply with his requests for sexually explicit photos and videos and continued to exploit and extort her until his arrest.
Similarly, Winfield exploited at least one victim in College Station, Texas.
If you believe you were also a victim of Winfield’s crimes, or have information related to this case, please contact the FBI at (614) 849-1733.
Kenneth L. Parker, United States Attorney for the Southern District of Ohio, and J. William Rivers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Division, announced the guilty plea offered this morning before U.S. Magistrate Judge Norah McCann King. U.S. Attorney Parker and Special Agent in Charge Rivers commended the cooperative investigation in this case with FBI divisions and state and local law enforcement agencies in Ohio, Virginia and Texas. Assistant United States Attorney Emily Czerniejewski is representing the United States in this case.
COLUMBUS, Ohio – A Columbus man was sentenced in U.S. District Court today to 324 months in prison for crimes related to sexually exploiting and sextorting more than 25 known victims in at least four states.
Lorenzo A. Winfield, 23, persistently and aggressively sought out and collected nude files of high school classmates and minor females he met online.
“Acts of sextortion are serious and have no place in our society. As we heard in court today from more than a dozen victims, this conduct creates significant harm,” said U.S. Attorney Kenneth L. Parker. “Today’s sentencing reflects that we will hold such perpetrators accountable for their damaging actions.”
According to court documents, from at least 2016 until 2021, Winfield used extortion tactics to solicit and collect explicit photos of underage girls at his Columbus high school, the Arts and College Preparatory Academy (ACPA), where he was known as the “ACPA Hacker”.
Winfield would contact students at ACPA and demand nude images and videos of them. He would also hack into victims’ social media accounts and use the photos he obtained in their private accounts against them as leverage for more content. Winfield would threaten the victims, letting them know he had nude content depicting them or other students and that he would distribute those images and videos unless the victims complied with his demands. On numerous occasions, Winfield followed through on these threats, distributing sexually explicit photos of his victims to others to prove he was serious with his threats in a bid to contain more content. In addition, Winfield told the victims to send him sexually explicit images or videos in order to regain control of their own social media accounts.
Winfield used several social media accounts of his own to engage in the exploitation and extortion of the victims. His accounts were active across platforms such as Discord, Facebook, Instagram, Snapchat, Skype and Google Hangouts.
Winfield was separately investigated by the FBI Washington Field Office for extorting and exploiting at least four victims in Fairfax and Prince William counties in Virginia.
For example, one identified victim was approximately 11 years old at the time Winfield first contacted her online. During their communications, Winfield obtained nude images of her and videos of her masturbating. Winfield used this content as leverage and eventually sent nude photos of the victim to students at a Virginia middle school to prove he was serious about his sextortion of her. Eventually, as the victim got older, Winfield also sent the images to students at her high school, promising the victim that if she got her friends to help her out by sending him nude images, that he would stop. Winfield threatened to harm the family of the Virginia minor if she did not comply with his requests for sexually explicit photos and videos and continued to exploit and extort her until his arrest.
Similarly, Winfield exploited at least one victim in College Station, Texas. The investigation revealed that the Texas victim sent approximately 50 pictures and videos to Winfield. Winfield demanded explicit images and videos of her daily. On one occasion, when the victim did not comply with Winfield’s demands, Winfield sent images of the victim’s nude breasts and vagina to the victim’s brother and friend.
The defendant pleaded guilty in December 2023 to sexually exploiting minors, possessing child pornography, and communicating interstate with the intent to extort.
Kenneth L. Parker, United States Attorney for the Southern District of Ohio, and Elena Iatarola, Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Division, announced the sentence imposed today by U.S. District Judge Michael H. Watson. U.S. Attorney Parker and Special Agent in Charge Iatarola commended the cooperative investigation in this case with FBI divisions and state and local law enforcement agencies in Ohio, Virginia and Texas. Assistant United States Attorney Emily Czerniejewski is representing the United States in this case.
KANSAS CITY, Mo. – Tom Larson, Acting United States Attorney for the Western District of Missouri, announced that a Kansas City, Kan., man was sentenced in federal court today for enticing a child victim, whom he met online, into engaging in illegal sexual activity.
Nathan R. Caylor, 42, of Kansas City, was sentenced by U.S. District Judge Gary A. Fenner to 24 years in federal prison without parole.
On Dec. 12, 2016, Caylor pleaded guilty to one count of enticing a minor to engage in illegal sexual activity and one count of receiving child pornography. Caylor admitted that he communicated online for more than a year with a 14-year-old victim, identified in court documents at “Jane Doe,” and traveled to her home to engage in sexual intercourse on at least eight separate occasions.
Caylor initially contacted Jane Doe in May 2013. He used the false name “Justin” and told her he was 17 years old. They exchanged photos of each other electronically and communicated via Skype. Caylor told Jane Doe that he had been diagnosed with cancer when he was 14 years old and that the chemotherapy and radiation he had to undergo for cancer made him look older. In reality, Caylor had never been diagnosed with cancer.
Caylor eventually turned the topic of their communications to graphic conversations of a sexual nature and made arrangements to meet Jane Doe in person. Caylor traveled to her home for the first time in November 2013 when her parents were not home. Between May 2013 and July 2014 Caylor also electronically sent pornographic photos of himself to Jane Doe.
In July 2014 the Blue Springs, Mo., Police Department was notified about Caylor’s contact with Jane Doe. A Blue Springs detective assumed Jane Doe’s identity on Facebook and began communicating with Caylor. Caylor asked if he could visit, and was told that her parents were not home. Caylor told Jane Doe that he would see her that same day. He traveled by bus from Kansas City, Kan., to Independence, Mo., then walked several miles to her home. Caylor was arrested while he was walking to the victim’s home.
Investigators also found images of child pornography on Caylor’s computer, including images of a 3-to-4-year-old victim and a 10-to-12-year-old victim. Caylor also was in possession of images of Jane Doe engaged in sexually explicit conduct.
Caylor has prior Kansas state convictions in 1993 for four counts of enticing a child and five counts of lewd and lascivious behavior. According to court documents, Caylor enticed four young children (between 7 and 8 years old) to enter a building so he could commit an unlawful sexual act upon them. He exposed himself to these same four children and as well as to a fifth child.
This case was prosecuted by Assistant U.S. Attorney David Luna. It was investigated by the Blue Springs, Mo., Police Department.
Project Safe Childhood
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
SAN FRANCISCO – The United States Attorney’s Office for the Northern District of California filed an indictment charging defendant Rodney L. Stevenson II with wire fraud, mail fraud, and money laundering for his operation of an e-commerce site that claimed to have N95 masks for sale during the current COVID-19 epidemic, announced United States Attorney David L. Anderson, U.S. Postal Inspector in Charge Rafael E. Nuñez, and Federal Bureau of Investigation Special Agent in Charge Craig Fair. Stevenson was previously arrested and charged via criminal complaint.
According to the indictment, Stevenson operated EM General, a Michigan limited liability company created in September 2019, which purported to sell N95 masks with N99 filters. At the onset of the COVID-19 pandemic in February 2020, EM General and its website, controlled by Stevenson, advertised that it had N95 masks “in stock” and available for shipping. EM General sold many of these masks for as much as $24.95 each. Also according to the indictment, to bolster the legitimacy of EM General, Stevenson created a professional-looking website that included the names, backstories, and stock photographs of a group of fake EM General executives. It also falsely described how long the company had been in business, its sales volume, and its reputation. Stevenson also used fictitious names in emails to customers.
The indictment alleges that, as the pandemic worsened and demand for N95 masks increased dramatically, EM General’s sales skyrocketed. EM General’s total sales from approximately on or about February 11, 2020, to approximately on or about March 8, 2020, were approximately $3,500,000 involving over 25,000 customers, the vast majority of which were sales of N95 masks that were never delivered to customers. This amount included over $900,000 in sales on February 28, 2020, alone.
According to the indictment, Stevenson and EM General delivered almost none of the masks. Instead, when customers complained and asked for refunds, Stevenson, at times communicating with Gmail accounts he created under the names of fake identities, generally refused to refund customers and instead offered a series of lies to fraudulently prolong his scheme while he continued selling masks. These lies included that EM General could not offer refunds because it had already paid for the customer’s order from a manufacturer, that products would ship soon, and that customers would receive tracking orders soon. For a small number of customers, Stevenson eventually fraudulently substituted masks that did not meet the standards set by the National Institutes of Occupational Safety and Health for N95 or N99 masks, meaning that they did not filter out 95 or 99 percent of particulate matter from the air.
Stevenson is charged with nine counts of wire fraud, in violation of 21 U.S.C. § 1343; one count of mail fraud, in violation of 18 U.S.C. § 1341; five count of laundering of monetary instruments, in violation of 18 U.S.C. § 1956(a)(1)(A)(i); and one count of money laundering, in violation of 18 U.S.C. § 1957.
An indictment merely alleges that crimes have been committed, and the defendant is presumed innocent until proven guilty beyond a reasonable doubt. If convicted, the defendant faces a maximum sentence of 20 years of prison, 5 years of probation, and a fine of $250,000 for each count of wire fraud or mail fraud, and a maximum sentence of 10 years of prison, 3 years of probation, and a fine of $250,000 for each count of laundering of monetary instruments or money laundering. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Stevenson was charged by criminal complaint with one count of wire fraud on April 22, 2020. He is currently scheduled for arraignment on the indictment on January 15, 2021, before Alex Tse, U.S. Magistrate Judge.
The case is being prosecuted by the Special Prosecutions Section the United States Attorney’s Office for the Northern District of California.
SAN FRANCISCO – Mihran Stepanyan, Artur Stepanyan, Yan German, and Khachig Geuydjian pleaded guilty today to crimes stemming from their respective roles in a wide-ranging racketeering conspiracy involving diversion of prescription drugs, money laundering, bank fraud, identity theft, and additional crimes, announced United States Attorney David L. Anderson; Federal Bureau of Investigation Special Agent in Charge John F. Bennett; and Internal Revenue Service, Criminal Investigation, Special Agent in Charge Kareem Carter. The pleas were accepted by the Hon. Charles R. Breyer, United States District Judge, and leaves one remaining defendant to stand trial for allegations made in a Second Superseding Indictment filed in February of 2016 against 38 defendants.
“Patients needing prescription drugs shouldn’t have to worry that their medications came out of a back alley,” said U.S. Attorney Anderson. “The defendants and their co-conspirators were able to make massive profits by diverting street drugs back into mainstream channels while creating false paperwork to conceal their true source. Thanks to the FBI, IRS, and federal prosecutors in San Francisco, the defendants now face the prospect of lengthy prison sentences for their criminal conduct.”
“The American public was victimized twice by this scheme,” said FBI San Francisco Special Agent in Charge John F. Bennett. “The majority of the profits were subsidized both by American taxpayers and by those paying private insurance premiums.” “Additionally, patients were put at risk by the movement of these black market drugs, as the defendants disregarded general safety protocols and guidelines, to include expiration dates and pharmaceutical lot numbers.”
“Today’s guilty pleas bring us one step closer to closing the chapter on this criminal enterprise,” said Kareem Carter, Special Agent in Charge IRS Criminal Investigation. “The crimes committed by these defendants ranged from picking up drugs at a pizza shop to a half-million-dollar tax check fraud scheme. In total, more than $199 million in diverted prescription drug proceeds were laundered through bank accounts established with false identities and shell companies. IRS-CI is committed to following the money so we can financially disrupt and dismantle criminal organizations like these.”
All four defendants pleading guilty today—Mihran Stepanyan (M. Stepanyan), his cousin Artur Stepanyan (A. Stepanyan), German, and Geuydjian—have acknowledged that they were members of a nationwide conspiracy referred to in court documents as the Karapedyan-Stepanyan Enterprise (Enterprise). One key aspect of the criminal activity was a multi-million dollar prescription drug diversion scheme. According to the plea agreements filed today, members and associates of the Enterprise procured prescription drugs from unlicensed sources, usually street dealers, and resold the drugs to unknowing customers. The Stepanyans also admitted that they are not licensed to sell drugs, that they procured millions of dollars of drugs through street suppliers and other unlicensed sources, and that the drugs they procured eventually were resold as legitimate products.
The Stepanyans’ plea agreements include an overview of the complexity and sophistication of the Enterprise’s operations. Members of the Enterprise conducted the affairs of the organization through a pattern of racketeering and committed crimes throughout California as well as in Minnesota, Ohio, and Puerto Rico. Further, the Stepanyans’ plea agreements describe how members and associates of the Enterprise procured and distributed a wide variety of drugs from unlicensed sources for distribution throughout the country. The drugs included medications used to treat HIV infection, Type-2 diabetes, dementia, and high blood pressure, among other conditions. Members and associates of the Enterprise also created false and fraudulent paperwork, referred to as pedigrees, to make it appear that those drugs had been purchased from legitimate sources. In addition, they created sham companies and used multiple bank accounts to receive and distribute the proceeds from their fraudulent transactions. The plea agreements also describe how the Stepanyans, along with other members and associates of the Enterprise, intentionally used the identities of real people to carry out their unlawful objectives. The plea agreements of Geuydjian and German provide further details of the Enterprise’s operations. Specifically, Geuydjian’s plea agreement describes how he negotiated fraudulent personal and tax checks for the benefit of the Enterprise, and German’s plea agreement describes how he supplied drugs for distribution by the Enterprise and managed aspects of the Enterprise’s money laundering operations.
According to M. Stepanyan’s plea agreement, he became a member of the Enterprise as early as January 2010. He admitted that he agreed with his co-conspirators to commit multiple criminal acts involving money laundering, mail fraud, wire fraud, bank fraud, identity theft, and multiple acts involving the distribution of drugs from unlicensed sources to conduct the affairs of the Enterprise. In his plea agreement, M. Stepanyan admitted that he controlled several entities, including Red Rock Capital Group, Inc.; Trans Atlantic Capital Group, Inc.; GC National Wholesale, Inc.; and Sky Atlantic Group, Inc., in addition to numerous bank accounts through which approximately $199 million of pharmaceutical money flowed between 2010 and 2014. M. Stepanyan also admitted purchasing approximately $56 million in gold using the illicit proceeds from the unlawful sale of prescription drugs. As a further example of his participation in the Enterprise, M. Stepanyan used an entity called Niva Pharmaceuticals to facilitate transactions related to the criminal conspiracy. Specifically, M. Stepanyan admitted that in January of 2014, he purchased Niva from a co-conspirator who had set up the company. Although Niva was licensed to engage in drug wholesaling in California, it was not and did not engage in wholesale drug distribution. Instead, M. Stepanyan acknowledged, Niva was nothing more than a shell company with offices that generally were empty except for a desk, a computer, and tables for drugs that the Enterprise procured. The plea agreement describes how Enterprise members stored boxes of drugs in Niva’s offices and shipped them throughout the country using fraudulent labels that suggested the drugs were being shipped by or to authentic companies, including a legitimate drug company operating in Puerto Rico.
A. Stepanyan also admitted in his plea agreement that he was a member of the Enterprise beginning in at least January of 2010. Between 2010 and 2015, he directed and participated in a prescription drug diversion scheme whereby he procured drugs from various unlicensed sources and sold them to a co-defendant who, in turn, sold the drugs to pharmacies throughout the United States. Further, A. Stepanyan admitted that the gross receipts for the sale of those diverted prescription drugs was at least $199 million. According to the plea agreement, A. Stepanyan and his cousin, M. Stepanyan, laundered those proceeds through various bank accounts established in false identities, which M. Stepanyan controlled.
German admitted in his plea agreement that he was a member of the Enterprise between 2013 and 2015. He acknowledged that he was responsible for establishing a network of unlicensed street suppliers to provide drugs for the distribution scheme. As described in his plea agreement, German had multiple sources of drugs. Between 2013 and 2014, he obtained boxes full of prescription drugs from one of his co-conspirators in Los Angeles, California. For example, he would pick up drugs from one of his sources at a pizza shop with the help of one of his associates, load the boxes into the trunk of a car, and drive them to a nearby mall or another pre-arranged location where he would deliver them to the Stepanyans. German also admitted that in his role managing money-laundering operations for the Enterprise, he assisted with wire fraud, bank fraud, identity theft, and illegal check cashing schemes. In the plea agreement, German admits that he used his birth name, Henrik Hartyunyan, during some of the underlying illegal conduct he performed on behalf of the Enterprise.
Geuydjian admitted that he was a member of the Enterprise from at least 2012 through approximately 2014. In his plea agreement, he describes himself as a “money launderer for the Enterprise.” Geuydjian acknowledged that he and others in the Enterprise created sham companies and used multiple bank accounts to receive and distribute the proceeds from the fraudulent transactions. Geuydjian liquidated tax fraud and drug diversion proceeds by making deposits to a number of sham corporate entities that he created and allowed other members and associates of the Enterprise to use his businesses to send illicit funds and other merchandise. Furthermore, Geuydjian used the identities of real people to carry out many of the Enterprise’s unlawful objectives. For example, the plea agreement describes how Geuydjian’s co-conspirators acquired and possessed stolen identifying information for dozens of individuals in order to file fraudulent tax returns online. The Enterprise obtained checks issued by the federal government and mailed from the United States Treasury based on fraudulent tax returns. From approximately August 2012 through August 2013, Geuydjian fraudulently liquidated approximately 51 checks totaling more than $538,295 though accounts he held in the names of three companies he controlled. Geuydjian also used photocopies of driver’s licenses, social security cards, or other personal identifying with the identities of real people to open bank accounts or gain access to the victims’ bank accounts, to negotiate checks made out in the victims’ names. Furthermore, Geudjian and his co-conspirators perpetrated a tax check fraud scheme. For example, in March 2014, Geudjian deposited two tax refund checks into fraudulent Wells Fargo bank accounts—one in the amount of $117,887 and another in the amount of $131,205. These checks, which were from legitimate tax return filings, were stolen out of the mail by “runners” employed by members of the conspiracy. Geudjian also liquidated approximately $71,806 that his co-conspirators stole from a victim’s Fidelity 401K retirement account.
On February 11, 2016, a federal grand jury handed down the Second Superseding Indictment charging the four defendants—as well as 34 additional individuals—with various crimes in connection with the activities of the Enterprise. All four defendants pleading guilty today are released on bond pending sentencing. A majority of the defendants in this case have pleaded guilty to various charges, including the following:
Defendant
Charges To Which Defendant Pleaded Guilty
Status of Sentencing
MIHRAN STEPANYAN, 34, Glendale, Calif.
Pleaded guilty today to racketeering conspiracy, in violation of 18 U.S.C. § 1962(d).
Sentencing scheduled for September 21, 2020
(statutory maximum of 20 years in prison and $250,000 fine)
ARTUR STEPANYAN, 43, Glendale, Calif.
Pleaded guilty today to racketeering conspiracy, in violation of 18 U.S.C. § 1962(d).
Sentencing scheduled for September 21, 2020
(statutory maximum of 20 years in prison and $250,000 fine)
KHACHIG GEUYDJIAN, 79, Chatsworth, Calif.
Pleaded guilty today to racketeering conspiracy, in violation of 18 U.S.C. § 1962(d).
Sentencing scheduled for September 21, 2020
(statutory maximum of 20 years in prison and $250,000 fine)
YAN GERMAN
a/k/a Henrik Hartyunyan, 40, Encino, Calif.
Pleaded guilty today to racketeering conspiracy, in violation of 18 U.S.C. § 1962(d).
Sentencing scheduled for September 21, 2020
(statutory maximum of 20 years in prison and $250,000 fine)
GEVORK TER-MKRTCHYAN, 58, Encino, Calif.
Pleaded guilty on August 23, 2017, racketeering conspiracy, in violation of 18 U.S.C. § 1962(d).
Sentenced on January 30, 2018, to 21 months in prison
ARMAN PETROSYAN, 37, Northridge, Calif.
Pleaded guilty on August 28, 2019, this defendant pled guilty pursuant to racketeering conspiracy, in violation of 18 U.S.C. § 1962(d).
Sentencing is scheduled for September 21, 2020
(statutory maximum of 20 years in prison and $250,000 fine)
LANNA KARAPEDYAN, 30, Los Angeles, Calif.
Pleaded guilty on October 22, 2019, to a Superseding Information charging her with aiding and abetting receiving, retaining, and concealing stolen or forged Treasury checks, in violation of 18 U.S.C. §§ 510(b) and 2.
Sentencing is scheduled for September 21, 2020 (statutory maximum of 10 years in prison and $250,000 fine)
MAXWELL STARSKY, 41, Studio City, Calif.
Pleaded guilty on August 29, 2017, racketeering conspiracy, in violation of 18 U.S.C. § 1962(d).
Sentenced on March 9, 2018, to 18 months in prison.
SEVAK GHARGHANI, 48, Burbank, Calif.
Pleaded guilty on August 28, 2019, to racketeering conspiracy, in violation of 18 U.S.C. § 1962(d).
Sentencing is scheduled for September 21, 2020 (statutory maximum of 20 years in prison and $250,000 fine)
JEAN DUKMAJIAN, 66, Los Angeles, Calif.
Pleaded guilty on October 22, 2019, to racketeering conspiracy, in violation of 18 U.S.C. § 1962(d).
Sentencing is scheduled for September 21, 2020 (statutory maximum of 20 years in prison and $250,000 fine)
KARINE DUKMAJIAN, 38, Reseda, Calif.
Pleaded guilty on October 22, 2019, to one count of conspiracy to commit wire fraud, in violation of 18 U.S.C. §§ 1343 and 1349.
Sentencing is scheduled for September 21, 2020 (maximum of 20 years in prison and $1,000,000, per count)
ANGELA DUKMAJIAN, 30, Los Angeles, Calif.
Pleaded guilty on October 22, 2019, to one count of conspiracy to commit wire fraud, in violation of 18 U.S.C. §§ 1343 and 1349.
Sentencing is scheduled for September 21, 2020 (maximum of 20 years in prison and $1,000,000)
ARMAN DANIELIAN, 44, Burbank, Calif.
Pleaded guilty on October 22, 2019, to one count of conspiracy to engage in unlicensed wholesale distribution of prescription drugs, in violation of 21 U.S.C. §§ 331(t), 333(b)(1)(D), and 353(e)(2)(A).
Sentencing is scheduled for September 21, 2020 (maximum of 10 years in prison and $250,000, per count)
ASATOUR MAGZANYAN, 58, Los Angeles, Calif.
Pleaded guilty on March 15, 2019, to racketeering conspiracy, in violation of 18 U.S.C. § 1962(d).
Sentencing is scheduled for September 21, 2020 (statutory maximum of 20 years in prison and $250,000 fine)
TIGRAN SARKISYAN, 45, Toluca Lake, Calif.
Pleaded guilty on May 10, 2017, to racketeering conspiracy, in violation of 18 U.S.C. § 1962(d).
Sentenced on August 1, 2018, to 15 months in prison.
HRIPSIME KHACHTRYAN, 45, Toluca Lake, Calif.
Pleaded guilty on May 10, 2017, to racketeering conspiracy, in violation of 18 U.S.C. § 1962(d).
Sentenced on August 1, 2018, to 12 months and one day in prison.
LOUI ARTIN, 58, North Hollywood, Calif.
Pleaded guilty on November 15, 2017, to racketeering conspiracy, in violation of 18 U.S.C. § 1962(d).
Sentencing is scheduled for September 21, 2020 (statutory maximum of 20 years in prison and $250,000 fine)
ARMAN ZARGARYAN, 37, Granada Hills, Calif.
Pleaded guilty on November 20, 2019, to racketeering conspiracy, in violation of 18 U.S.C. § 1962(d).
Sentencing is scheduled for September 21, 2020 (statutory maximum of 20 years in prison and $250,000 fine)
DMITRIY KUSTOV, 50, Los Angeles, Calif.
Pleaded guilty on May 10, 2017, to racketeering conspiracy, in violation of 18 U.S.C. § 1962(d).
Sentenced on August 29, 2018 to a term of probation.
MICHAEL INMAN, 58, Los Angeles, Calif.
Pleaded guilty on February 8, 2017, to one count of conspiracy to commit bank fraud, in violation of 18 U.S.C. § 1349.
Sentenced on June 7, 2017, to 34 months in prison.
ARAXIA NAZARYIAN, 29, Van Nuys, Calif.
Pleaded guilty on December 18, 2019, to a Superseding Information charging her with misdemeanor introduction or delivery for introduction of adulterated or misbranded drugs, in violation of 21 U.S.C. §§ 331(a) and 333(a)(1)).
Sentencing is scheduled for September 21, 2020 (maximum statutory sentence is one year in prison and a $1,000 fine)
CHERYL BARNDT, 46, Spicewood, Texas
Pleaded guilty on August 21, 2019, to a Superseding Information charging her with misdemeanor introduction or delivery for introduction of adulterated or misbranded drugs, in violation of 21 U.S.C. §§ 331(a) and 333(a)(1)).
Sentencing is scheduled for September 21, 2020 (maximum statutory sentence is one year in prison and a $1,000 fine)
ERIC FIGUEROA, 35, Los Angeles, Calif.
Pleaded guilty on June 13, 2018, to one count of conspiracy to engage in the unlicensed wholesale distribution of drugs, in violation of 21 U.S.C. §§ 331(t), 333(b)(1)(D), 353(e)(2)(A), and 18 U.S.C. § 371.
Sentenced on February 22, 2019, to three years’ probation, six months of home detention, and 200 hours of community service.
MARC ASHEGHIAN, 59, Sherman Oaks, Calif.
Pleaded guilty on December 11, 2019 to a Superseding Information charging him with aiding and abetting the unlicensed wholesale distribution of drugs, in violation of 21 U.S.C. §§ 331(t), 333(b)(1)(D), 353(e)(2)(A), and 18 U.S.C. § 2.
Sentencing is scheduled for September 21, 2020 (maximum statutory sentence is 10 years in prison and a $250,000 fine)
MICHAEL ASHEGHIAN, 71, Vernon, Calif.
Pleaded guilty on December 11, 2019 to a Superseding Information charging him with aiding and abetting the unlicensed wholesale distribution of drugs, in violation of 21 U.S.C. §§ 331(t), 333(b)(1)(D), 353(e)(2)(A), and 18 U.S.C. § 2.
Sentencing is scheduled for September 21, 2020 (maximum statutory sentence is 10 years in prison and a $250,000 fine)
ARARAT YESAYAN, 39, Glendale, Calif.
Pleaded guilty on February 6, 2017, to one count of conspiracy to commit identity theft, in violation of 18 U.S.C. § 1028(f).
Sentenced on June 9, 2017 to a term of five years of probation.
ILIA NALBANS, 57, Montbello, Calif.
Pleaded guilty on March 15, 2019 to two counts of forging endorsements on Treasury checks and aiding and abetting the same, in violation of 18 U.S.C. §§ 510 and 2.
Sentenced on June 19, 2019, to restitution of $17,215 and a term of two years of supervised release.
For those defendants who have not yet been sentenced, in addition to a term of imprisonment and fine, the court also may order additional periods of supervised release, restitution, and special assessments. However, any sentence following conviction would be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
A separate investigation resulted in another indictment filed on May 6, 2015 in the Southern District of Ohio charging M. Stepanyan, A. Stepanyan, and others with various crimes arising from their sale of millions of dollars of illicitly-procured drugs. That matter was transferred to the Northern District of California and consolidated with the instant case.
Assistant United States Attorneys Claudia A. Quiroz, Andrew Dawson, and Chris Kaltsas are prosecuting the case with the assistance of Adrienne DelaPena and Kevin Costello. The prosecution is the result of an investigation by the Federal Bureau of Investigation and the IRS.
Jose Donaire-Duarte, age 21, from Spain, was sentenced to seven days incarceration for simple assault and two years of unsupervised probation for disorderly conduct. U.S. Magistrate Judge Stephanie A. Hambrick imposed the sentence on Aug. 28. According to the charging documents, while leaving a social event in the Mammoth Hot Springs concession area, hosted by Xanterra the concessionaire for Yellowstone Nation Park, an intoxicated Donaire-Duarte began sexually harassing the victim. He grabbed the victim around the waist, held her tightly against him and grabbed her buttocks repeatedly. The victim felt afraid, broke away from Donaire-Duarte and began to run. He pursued the victim, grabbed her by both shoulders, preventing her from running and pulled her close to him again. Upon arrival at the dormitory where both resided, Donaire-Duarte followed the victim to her room, where he climbed on top of her in bed, with his chest on her chest and his arms on either side of the victim, while repeating the victim’s name. A third party arrived in the victim’s room, at which point Donaire-Duarte left. The crime was investigated by the National Park Service. The case was prosecuted by Assistant U.S. Attorney Ariel Calmes. Case No. L:24-PO-00670-SAH-1
Firearm Offenses
James Herman Bell, 51, of Riverton, Wyoming, was sentenced to be imprisoned until May 5, 2025 and three years of supervised release. Chief U.S. District Court Judge Scott W. Skavdahl imposed the sentence on Aug. 28. According to court documents, Bell was seen by employees stealing ammunition from a store in Riverton. The Riverton Police Department (RPD) were dispatched and given descriptions of two men. RPD located the men a few blocks away. They each turned over items they had taken without paying, including Bell who had a 20-round box of .358 rifle ammunition. Bell is convicted felon and is not allowed to possess firearms or ammunition. Bell was indicted on Nov. 15, 2023 and pleaded guilty on May 31. This crime was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, RPD, and the Wyoming Division of Criminal Investigation. The case was prosecuted by Assistant U.S. Attorney Timothy W. Gist. Case No. 23-CR-00162
Sexual Abuse
Skyler Sven Quiver, 29, of Ethete, Wyoming, was sentenced to 70 months in federal prison and five years of supervised release for sexual abuse of a person incapable of consent. Chief U.S. District Court Judge Scott W. Skavdahl imposed the sentence on Aug. 29. According to court documents, a minor victim reported a rape in June 2012. At that time, she could not identify the person who raped her because she was extremely intoxicated. A rape examination detected semen and although the DNA did not match a prior male subject, it was kept on file. In 2021, a routine search of the FBI Combined DNA Index System (“CODIS”) database indicated a possible DNA association between biological evidence collected from the minor victim and a newly convicted offender, the defendant. Quiver was interviewed and admitted to having sex with victim and when asked if it was possible she was too intoxicated to give consent, he said, “yes.” This crime was investigated by the FBI and the case was prosecuted by Assistant U.S. Attorney Michael Elmore. Case No. 24-CR-00015
About the United States Attorney’s Office
The United States Attorney’s Office is responsible for representing the federal government in virtually all litigation involving the United States in the District of Wyoming, including all criminal prosecutions for violations of federal law, civil lawsuits brought by or against the government, and actions to collect judgments and restitution on behalf of victims and taxpayers. The Office is involved in several programs designed to make our communities safer. They include:
Environmental Justice
The fair treatment and meaningful involvement of all people regardless of race, color, national origin, or income with respect to the development, implementation, and enforcement of environmental laws, regulations, and policies.
Project Safe Childhood
Project Safe Childhood (PSC) is a DOJ initiative that combats the proliferation of technology-facilitated sexual exploitation crimes against children. The threat of sexual predators soliciting children for sexual contact is well-known and serious.
Project Safe Neighborhoods
Project Safe Neighborhoods (PSN) is a nationwide commitment to reducing gun and gang crime in America by networking existing local programs that target gun crime and providing these programs with additional tools necessary to be successful.
Victim Witness Assistance
The Victim Witness Coordinator for the United States Attorney’s Office for the District of Wyoming is dedicated to making sure that victims of federal crimes and their family members are treated with compassion, fairness, and respect.
To report a federal crime, go to: https://www.justice.gov/actioncenter/report-crime#trafficking
ASHEVILLE, N.C. – The U.S. Attorney’s Office for the Western District of North Carolina and the FBI, in partnership with the AARP NC in the Mountain Region, the Buncombe County Sheriff’s Office and the Land of Sky Regional Council, hosted an informational seminar today in Asheville, to educate veterans and those who serve about financial scams and how to prevent becoming victims of fraud, announced U.S. Attorney Andrew Murray.
Scammers are targeting veterans at an alarming rate. According to a 2017 study conducted by the AARP, U.S. military veterans are twice as likely as nonveterans to fall victims of financial fraud. Of those surveyed, 80 percent of veterans reported being the target of a scam related to their military service.
Examples of financial fraud targeting veterans which were discussed during this morning’s informational session are:
Benefits fraud and scams promoting secret” government benefits programs.
Scams related to military records.
Fundraising for fake military/veterans charities.
Scams involving Veterans Affairs (VA) loans.
Bogus investment schemes targeting older veterans to help “boost” their pensions.
Identity theft.
“As a Coast Guard veteran, I am enraged that scammers are looking to get rich at the expense of our veterans and those currently serving our country. We have a responsibility to protect our brave servicemen and women and their families from financial exploitation and financial peril caused by scam artists. I want to thank the FBI, the AARP, the Buncombe County Sheriff’s Office, and Land of Sky Regional Council for partnering with us in this important mission. It’s time to take action and stop the fraud,” said U.S. Attorney Murray.
“AARP has a long history of safeguarding Americans’ financial security. We are proud to work with partners to empower those who have protected our country with the knowledge that they can use to protect themselves from frauds and scams that target veterans and their loved ones from their guaranteed benefits,” said Rebecca Chaplin, Associate State Director with AARP.
“The Area Agency on Aging at Land of Sky Regional Council was happy to partner with the Department of Justice/U.S. Attorney’s Office for the Western District of North Carolina, the FBI, and AARP to host this event. One of our goals is to reduce the criminal victimization of older adults and caregivers, including veterans. We want to decrease unwarranted fear and crime and improve the safety and quality of life for all. We do this through outreach opportunities as education is the key to prevention,” said LeeAnne Tucker, Director of the Area Agency on Aging.
Below are some tips shared with participants during the seminar on how to avoid falling victim to a financial scam:
Don’t share personal information such as your social security number, with anyone you don’t know.
Don’t pay a fee for obtaining your military records.
Don’t be lured by “special deals” available only to veterans.
Delete phishing emails and ignore harassing phone calls.
Don’t give cash upfront in exchange for future pension payments.
Don’t fall for a high-pressure sales pitch or a lucrative business deal.
If a scammer approaches you, take the time to talk to other service members, or a family
member.
Keep in mind that if you send money once, you’ll be a target for life.
A good rule of thumb is, if it’s too good to be true, it’s likely a scam.
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In March 2019, the U.S. Attorney’s Office and the FBI announced the Western District’s Elder Justice Initiative, which aims to combat elder financial exploitation by expanding efforts to investigate and prosecute financial scams that target seniors; educate older adults on how to identify scams and avoid getting ripped off by scammers; and promote greater coordination with law enforcement partners.
U.S. Attorney Murray thanked the FBI, the AARP, the Buncombe County Sheriff’s Office, and the Land of Sky Regional Council for their assistance in organizing today’s seminar.
For more information about the U.S. Attorney’s Office Elder Justice Initiative, please visit: https://www.justice.gov/usao-wdnc/elder-justice-initiative.
To view our Public Service Announcement, please visit: https://youtu.be/qBGGAA7Mxbo
BOSTON – An Israeli national and a co-conspirator were indicted in U.S. District Court in Boston in connection with a conspiracy to transfer $2.5 million of cocaine from Colombia to Israel via Boston as well as money laundering.
Jalal Altarabeen, a/k/a Glal El Tarbin, a/k/a Jalal Salamah, a/k/a Abu Rasheed, 33, and a co-conspirator were indicted on one count of conspiring to possess with intent to distribute and to distribute more than five kilograms of cocaine and six counts of international money laundering. Altarabeen, who was extradited from Poland and arrived at Boston’s Logan Airport this afternoon, was detained following an initial appearance before U.S. District Court Magistrate Judge M. Page Kelley. Altarabeen and his co-conspirator were previously charged in a federal criminal complaint which was partially unsealed today.
“This case exemplifies the importance of disrupting large-scale, international drug trafficking before the drugs can be distributed. I cannot overstate how important it is that we interdict these large drug shipments, where and when we can,” said Acting United States Attorney William D. Weinreb. “Working with some of the finest undercover agents in the country, the U.S. Attorney’s Office will continue to attack the growing menace of transnational drug organizations.”
“DEA is addressing the threat, both internationally and domestically. We prioritize our resources by identifying and targeting the world’s biggest and most powerful drug traffickers and their organizations,” said Special Agent in Charge of the DEA Michael J. Ferguson. “We are relentlessly pursuing these criminal groups responsible for international money laundering and violations of the Controlled Substance Act and their facilitators at every level and we value and appreciate the work of our Polish counterparts. This investigation demonstrates the fortitude and continued commitment of our federal, state and international law enforcement partners and our strong partnership with the U.S. Attorney’s Office to seek and bring to justice anyone who engages in these crimes.”
“IRS Criminal Investigation is committed to unraveling complex international financial transactions and money laundering schemes. IRS Criminal Investigation is also committed to following the money, wherever it leads,” stated Special Agent in Charge Joel P. Garland of the Internal Revenue Service Criminal Investigation’s Boston Field Office.
According to court documents, from October 2015 to April 20, 2016, Altarabeen and his co-conspirator conspired in Boston, Colombia, Poland, and elsewhere to distribute 50 kilograms of cocaine and launder money internationally. Altarabeen and his co-conspirator allegedly negotiated to buy 50 kilograms of cocaine from an undercover officer posing as a drug trafficker. Altarabeen and his co-conspirator agreed to pay $50,000 per kilogram for a total purchase price of $2.5 million to have the cocaine delivered in Israel. The undercover officer told the defendants that the cocaine would be transported from Colombia to Boston and from Boston to Beersheba, Israel, where the defendants expected to take delivery of the cocaine. Altarabeen agreed to make an advance payment of nearly $1 million to cover transportation costs and sent wire transfers from Turkey totaling $999,972 to an undercover bank account in Boston. The undercover officer and Altarabeen agreed that Altarabeen would pay the balance of $1.5 million after the receipt and sale of the 50 kilograms of cocaine.
The undercover officer’s relationship with the co-conspirator began in 2008 and included a meeting in Nicosia, Cyprus. In October 2015, the co-conspirator told the undercover officer about an associate who was interested in purchasing large quantities of cocaine. Eventually, the co-conspirator facilitated an introduction of the undercover officer to Altarabeen.
Over several months, the undercover officer and the defendants spoke to one another by telephone, WhatsApp, video Skype call and in person. The defendants contacted the undercover officer using telephone numbers from Cyprus, Jordan, Israel, Palestine and Colombia. The defendants also discussed the drug transaction with the undercover officer while in Bogota, Colombia, on October 14, 2015 and February 9, 2016.
Altarabeen allegedly arranged six wire transfer deposits in February 2016 into a Boston-based undercover bank account totaling $999,972. The co-conspirator sent the undercover officer a copy of the deposit receipt for each wire transfer via WhatsApp. All of the wire transfers originated from a Turkish bank.
The drug trafficking statute provides for a minimum mandatory sentence of 10 years and up to life in prison, a minimum of five years and up to a lifetime of supervised release, and a fine of up to $10 million on the drug counts. The money laundering statute provides for up to 20 years in prison, a minimum of three years and up to a lifetime of supervised release, and a fine of up to $500,000 or twice the value of the property involved in the offense. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based on the U.S. Sentencing Guidelines and other statutory factors.
Acting U.S. Attorney Weinreb, DEA SAC Ferguson and IRS-CI SAC Garland made the announcement today. Assistant U.S. Attorney Linda M. Ricci of Weinreb’s Narcotics and Money Laundering Unit is prosecuting the case.
The details in the charging documents are allegations. The defendants are presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
LOUISVILLE, KY. – Melvin Dowell, 55, previously pled guilty before United States District Judge David J. Hale for attempted online enticement and transfer of obscene material to a minor, announced Acting United States Attorney Michael A. Bennett. Yesterday, Judge Hale sentenced Dowell to 10 years in prison followed by a 10-year term of Supervised Release, ordered payment of a $5,000 Special Penalty Assessment under the Justice for Victims of Trafficking Act, and imposed a $12,000 fine. Dowell will be required to register as a sex offender.
“Outstanding effort by AUSA Lawless and our federal, state, and local law enforcement partners on a successful investigation and prosecution,” said Acting U.S. Attorney Bennett. “I am grateful for their dedication and the work they do to protect the children of the Commonwealth from sexual exploitation and abuse.”
“This case reminds us that predators will use any means necessary to exploit children, and it’s important for parents and caregivers to have conversations with their children about online safety,” said Attorney General Cameron. “I appreciate the work of our Department of Criminal Investigations and our law enforcement partners in identifying and stopping this predator, and I am grateful to Acting U.S. Attorney Bennett and his team for prosecuting the case.”
According to the Plea Agreement, on August 14, 2019, a Detective with the Kentucky Attorney General’s Department of Criminal Investigations posed as a 15-year-old girl. That same day, an unknown subject (later identified as Dowell), reached out to the UC. The two communicated over e-mail and eventually text message. Dowell directed the conversations to a sexual nature. He requested “naked” images of the UC, requested details about her sexual history, sent sexually explicit images of himself, and requested to meet the girl to engage in sex acts.
On August 30, 2019, law enforcement officials agreed to meet Dowell at a predetermined location in Elizabethtown, Kentucky. Dowell continued to communicate with the UC and gave updates to his arrival time while in route. At approximately 6:38 p.m., Dowell stated he had arrived at the location. At the same time, a red Ford Ranger pickup pulled into the driveway of the house where the two had agreed to meet. Dowell then got out of the truck and entered the residence where he was arrested. A pat down search revealed that Dowell had two Skyn brand, non-latex condoms (as discussed during their communications).
After being advised of his constitutional rights, Dowell admitted that he had met a person online that stated they were a minor. He went on to say that he traveled to the location where he was arrested after discussing sex acts with her. He also admitted using the Internet to engage in the conversations via his cell phone. Dowell stated that his cell phones were inside the truck he had driven to the location. Search of the phones under the authority of a search warrant revealed the communications between Dowell and the UC.
Assistant United States Attorney Jo E. Lawless prosecuted the case. The joint investigation was conducted by the United States Secret Service and Kentucky Attorney General’s Office with assistance from the Elizabethtown Police Department, United States Marshals Service, and Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF).
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This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Spokane – Joseph H. Harrington, Acting United States Attorney for the Eastern District of Washington, announced that Saturday, April 24, 2021, from 10:00 a.m. to 2:00 p.m. is National Prescription Drug “Take Back Day.” This year marks the 20th biannual event in the ten-year history of the Drug Take Back initiative. Drug Take Back Day gives the public the opportunity to prevent pill abuse and theft by ridding their homes of potentially dangerous, expired, unused, and unwanted prescription drugs.
The United States Attorney’s Office for the Eastern District of Washington will be partnering this Saturday with the Drug Enforcement Administration (DEA), Spokane Police Department, and other community partners at Northtown Mall, 4750 North Division, located in the northwest corner of Division Street and Queen Avenue in Spokane. To keep everyone safe, collection sites will follow local COVID-19 guidelines and regulations.
At its last Take Back Day in October 2020, DEA collected nationally a record-high amount of expired, unwanted, and unused prescription medications, with the public turning in close to 500 tons of unwanted drugs. Over the 10-year span of Take Back Day, DEA has brought in more than 6,800 tons of prescription drugs. With studies indicating a majority of abused prescription drugs come from family and friends, including from home medicine cabinets, clearing out unused medicine is essential. Of those numbers, Washington State collected 13,842 pounds of prescription drugs at approximately 56 collections sites operated by the DEA and 61 of its state and local law enforcement partners. In its previous events, Washington State alone has collected 270,260 pounds of prescription drugs. Overall, in its 19 previous Take Back events, DEA and its partners have taken in 13,684,848 pounds (6,842.4 tons) of pills.
According to the Centers for Disease Control and Prevention, the U.S. has seen an increase in overdose deaths during the COVID-19 pandemic. The increase in drug overdose deaths appeared to have begun prior to the COVID-19 health emergency but accelerated during the pandemic.
Acting U.S. Attorney Harrington said, “Participating in drug take-back events is one step that individuals can do to help positively impact the opioid crisis and protect their loved ones. We now face a national epidemic reaching every corner of America. Opioid overdoses have skyrocketed since the late 1990’s, becoming the worst drug epidemic in modern American history. The United States is seeing an increase in overdose deaths during the COVID-19 pandemic. Prescription drug misuse and overdose deaths do not discriminate – they can impact anyone of any age, race, gender or demographic.”
In addition to DEA’s National Prescription Drug Take Back Day, there are many other ways to dispose of unwanted prescription drugs every day. The FDA provides information on how to properly dispose of prescription drugs. To find out where year-round disposal sites are located, go to https://www.fda.gov/consumers/consumer-updates/where-and-how-dispose-unused-medicines.
For more information about Annual Prescription Drug Take Back Day, go to www.DEATakeBack.com
Spokane – Joseph H. Harrington, United States Attorney for the Eastern District of Washington, announced that George Skylar Cloud, age 22, of White Swan, Washington, and an enrolled member of Confederated Bands and Tribes of the Yakama Nation, was sentenced after having been convicted after a four-day jury trial in January 2019 of one count of First Degree Murder and one count of Discharging a Firearm During a Crime of Violence, and after having pleaded guilty on February 21, 2018, to one count of Discharging a Firearm During a Crime of Violence involving a separate incident. United States District Judge Stanley A. Bastian sentenced Cloud to a term of life imprisonment on the First Degree Murder count, and two consecutive 10-year terms of imprisonment on the Discharging a Firearm During a Crime of Violence counts.
According to information disclosed during court proceedings, in early to mid-March 2016, Cloud was a passenger in a Chrysler with multiple occupants. The owner of the Chrysler stopped to talk with an acquaintance near the Yakamart in Toppenish, Washington. Cloud decided to take the vehicle so he jumped into the front seat, displayed a firearm, and shot the car owner in her leg. The wounded victim got out and Cloud drove away in the stolen vehicle. Afraid of Cloud, the victim did not report the crime to law enforcement or seek medical treatment. However, members of the community later notified law enforcement that Cloud had bragged about shooting the car owner and stealing her car.
In late March 2016, Cloud and another individual mistakenly believed that Felina Metsker provided, or was going to provide, information to law enforcement about the incident so they decided to murder her. In late March 2016, Ms. Metsker was shot in the head in her residence. Cloud and another individual wrapped Ms. Metsker’s body in her bedding, dragged her across the floor of her residence, and placed her body in the stolen Chrysler. Cloud then transported Ms. Metsker’s body to a remote location within the boundaries of the Yakama Nation, and left her. Cloud returned to Ms. Metsker’s residence and requested some of his family members to assist him in trying to sanitize it. The stolen Chrysler was later abandoned in a rural area within the boundaries of the Yakama Nation.
On April 1, 2016, a citizen notified the Yakama Nation Police Department that blood had been observed in Ms. Metsker’s residence. Ms. Metsker had also been reported as a missing person. Detectives with the Yakama Nation Police Department responded to the residence, secured it and contacted the Federal Bureau of Investigation. After obtaining a warrant to search Ms. Metsker’s residence, FBI investigators observed dried blood on the residence’s ceiling, wall and floor. Investigators also perceived what appeared to be dried fragments of a human brain on a wall behind a bed. The FBI agent in charge of the investigation believed that the murderer(s) wrapped the victim’s body in bedding and transported the body to another location. In May 2016, human remains, including a skull, were discovered in a rural area within the boundaries of the Yakama Nation. The human remains were decomposed and animals had disturbed the area. Over the next 21 months, law enforcement officers conducted an unrelenting and thorough investigation.
As the investigation progressed, the FBI learned that Cloud had carjacked a victim in early to mid-March 2016, and stole her Chrysler vehicle. A Yakama Nation police officer eventually discovered the stolen Chrysler and notified the FBI. During a search of the Chrysler’s trunk, investigators discovered traces of DNA. This, along with other evidence, that had been collected was submitted to the FBI Laboratory in Quantico, Virginia. A forensic scientist determined that Ms. Metsker was the source of blood found in the residence, and the human remains were Ms. Metsker. An FBI metallurgist discovered traces of low zinc brass and lead embedded in the remains of Ms. Metsker’s skull, which was consistent with a bullet wound. No DNA or latent fingerprint evidence linking Cloud to Ms. Metsker’s residence was recovered. Several local residents were unwilling to cooperate with law enforcement during the investigation. In December 2017, a witness came forward and provided information concerning the murder.
At the sentencing hearing, Judge Bastian observed that although Cloud was only 22 years of age, he had a “remarkable history of incredible violence.” Furthermore, the Court observed that in murdering Ms. Metsker, Cloud stole a life from Ms. Metsker, he stole a mother from her children, and he stole a daughter from her mother.
Joseph H. Harrington said, “The United States Attorney’s Office for the Eastern District of Washington commends the officers with the Yakama Nation Police Department and the Federal Bureau of Investigation who investigated this case. Their seamless partnership resulted in the successful outcome of this matter. The sentences imposed send a clear message that anyone who commits a violent federal crime will be sentenced to a lengthy term of federal prison.”
Two of Cloud’s family members have entered pleas of guilty for their respective roles. On December 14 and 19, 2018, Kristen Ashlie Windy Cloud and Nicole Lee Sunny Cloud pled guilty to one count of Misprision of a Felony. On March 6, 2019, Judge Bastion sentenced Kristen Ashlie Windy Cloud to serve an 18-month term of imprisonment, to be followed by a 1- year term of court supervision upon release from federal prison. Nicole Lee Sunny Cloud’s sentencing date is pending.
This case was investigated by the Yakima Resident Office of the Federal Bureau of Investigation, and the Yakama Nation Police Department. This case was prosecuted by Tom Hanlon, an Assistant United States Attorney for the Eastern District of Washington.
Spokane – Joseph H. Harrington, United States Attorney for the Eastern District of Washington, announced that Saturday, April 27, 2019, from 10:00 a.m. to 2:00 p.m., is National Prescription Drug “Take Back Day.” This event will give the public its 17th opportunity in nine years to prevent pill abuse and theft by ridding their homes of potentially dangerous, expired, unused, and unwanted prescription drugs. The United States Attorney’s Office for the Eastern District of Washington will be partnering this Saturday with the Drug Enforcement Administration, Spokane Police Department, and other community partners at C.O.P.S. North Central/Knox Presbyterian Church, 806 W. Knox Avenue, Spokane.
U.S. Attorney Harrington said, “Participating in drug take-back events is one step that individuals can do to help positively impact the opioid crisis and protect their loved ones. Opioid overdoses have skyrocketed since the late 1990’s, becoming the worst drug epidemic in modern American history. Over 42,000 Americans died from opioid overdoses in recent years – more than deaths from automobile accidents or firearm-related homicides.”
Last fall, Americans turned in nearly 460 tons (more than 900,000 pounds) of prescription drugs at more than 5,800 sites operated by the DEA and almost 4,800 of its state and local law enforcement partners. Of those numbers, Washington State collected 15,604 pounds of prescription drugs at approximately 96 collections sites operated by the DEA and 85 of its state and local law enforcement partners. In its 16 previous “take back” events, Washington State along has collected 224,037 pounds of prescription drugs. Overall, in its 16 previous Take Back events, DEA and its partners have taken in almost 11 million pounds – nearly 5,500 tons – of pills.
The disposal service is free and anonymous, no questions asked. Liquids, needles, or sharps cannot be accepted at the sites, only pills or patches.
This initiative addresses a vital public safety and public health issue. Medicines that languish in home cabinets are highly susceptible to diversion, misuse, and abuse. Rates of prescription drug abuse in the U.S. are alarmingly high, as are the number of accidental poisonings and overdoses due to these drugs. The Substance Abuse and Mental Health Services Administration’s National Survey on Drug Use and Health shows year after year that the majority of misused and abused prescription drugs are obtained from family and friends, including someone else’s medication being stolen from the home medicine cabinet. In addition, Americans are now advised that their usual methods for disposing of unused medicines—flushing them down the toilet or throwing them in the trash—pose potential safety and health hazards.
In the City of Spokane, year-round disposal sites are located at Spokane Police Department’s North Precinct, 5124 N. Market, Monday through Friday, 9:00 – 4:00; the Public Safety Building, 1100 W. Mallon Avenue, Monday through Friday 8:00 – 5:00; and Spokane Police Department’s Downtown Precinct in the Intermodal, 221 W. First, 24 hr/7 days a week. In Spokane County a year-round disposal site is located in the Spokane Valley Police Department lobby, 12710 E. Sprague Avenue, Monday through Friday, 8:00 – 5:00.
For more information about additional collection sites in Eastern Washington and the disposal of prescription drugs for the April 27, 2019, Take Back Day event, go to www.DEATakeBack.com
DES MOINES, Iowa – A Las Vegas, Nevada woman was sentenced today to five years in federal prison for possession with intent to distribute a controlled substance containing fentanyl that led to an overdose death.According to public court documents, in the fall of 2023, Alica Marie Hawkins, 34, was identified as a source of supply of fentanyl pills in the Southern District of Iowa. On September 11, 2023, Hawkins distributed a fentanyl mixture to the victim in Jefferson, Iowa. The victim died due to an overdose from the fentanyl mixture. Hawkins did not render aid to the victim, tried to conceal any involvement, and eventually returned to Nevada during the investigation.After completing her term of imprisonment, Hawkins will be required to serve a five-year term of supervised release. There is no parole in the federal system.United States Attorney Richard D. Westphal of the Southern District of Iowa made the announcement. This case was investigated by the Jefferson Police Department and Des Moines Police Department.Fentanyl has become the leading cause of drug overdose deaths in the United States. Counterfeit, fentanyl-laced pills often resemble pharmaceutical pills, but contain potentially lethal doses of fentanyl. In 2023, accidental overdose was the number one cause of death in 37 states for residents under 40 years old. https://stateline.org/2023/09/05/death-rates-for-people-under-40-have-skyrocketed-blame-fentanyl/. In Iowa, opioid-related deaths reached a record high 258 in 2021, up 64% compared with 2019, and decreased 8% in 2022. https://hhs.iowa.gov/media/11935/download.
BIRMINGHAM, Ala. – A grand jury this week indicted a resident of Jacksonville, Alabama, on child exploitation charges, announced U.S. Attorney Prim F. Escalona and Federal Bureau of Investigation Acting Special Agent in Felix A. Rivera-Esparra.
A two-count indictment filed in the U.S. District Court charges Skyler Joseph Weeks, 31, with attempted coercion and enticement of a minor and possession of child pornography arising out of events that occurred from August 2022 to October 2022.
According to the indictment, from August 7, 2022, until October 13, 2022, Weeks attempted to coerce and entice an individual who had not attained the age of 18 years to engage in prostitution and other sexual activity. Weeks also illegally possessed child pornography that involved a minor that had not attained the 12 years of age.
The maximum penalty for attempted coercion and enticement of a minor is ten years to life in prison and a $250,000 fine. The maximum penalty for child pornography is 20 years in prison and a $250,000 fine.
The FBI investigated the case along with the Homewood Police Department. The Alabama Law Enforcement Agency assisted in the investigation. Assistant U.S. Attorney Daniel S. McBrayer is prosecuting the case.
The case was brought as part of Project Safe Childhood, a nationwide initiative launched by the Department of Justice in May 2006 to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
An indictment contains only charges. A defendant is presumed innocent unless and until proven guilty.
Three men who distributed an opioid that led to the death of the person who used the drug were sentenced to federal prison over the last week.
“Opioid abuse remains at an all-time high and these dangerous drugs wreak havoc on lives and communities,” said United States Attorney Pete Deegan. “Street drugs - including those sold over the internet - routinely contain powerful opioids. These drugs have never been more deadly and anyone caught distributing them will be held accountable.”
Opioids are extremely dangerous and powerful drugs. These drugs are so potent that extremely small doses can cause overdose and even death. The picture below shows fatal doses of three different opioids.
Over the last week, three men were sentenced to federal prison in Cedar Rapids for their roles in distributing opioids that eventually led to the deaths of three Iowans who used the drugs. These cases demonstrate that those buying and using drugs may not know they are getting. They may be getting more powerful and dangerous drugs then they realize. Either way, the use of an opioid too often ends with death because a drug user does not know what kind of drug they are taking or how dangerous it is.
The three men sentenced were:
On October 17, 2018, Richard Leroy Parker, age 47, from Dubuque, Iowa, received a sentence of life imprisonment following a January 18, 2018, jury verdict finding him guilty of distribution of heroin within 1,000 feet of an elementary school and a playground, resulting in death, and of possession with intent to distribute heroin within 1,000 feet of an elementary school and a playground.
The evidence at trial showed that Parker obtained several grams of heroin in Chicago in April 2017. On Easter Sunday, Parker brought the heroin to a residence on Rhomberg Avenue in Dubuque. Parker and other individuals at the residence drank alcohol and smoked crack cocaine throughout the day. Prior to midnight, Parker and a woman went into a back bedroom. While inside the room, Parker gave the woman heroin, which she used. Shortly after using the heroin, she stopped breathing. At approximately 12:20 a.m. on April 17, Parker called 911, and emergency responders arrived at the scene. Parker testified that, as emergency responders were attempting to save the woman’s life, he went into another room and hid the remaining heroin in a chair. Investigators later found the rest of the heroin. The attempts to resuscitate the woman were unsuccessful, and she was pronounced dead shortly after 1:15 a.m.
Parker had numerous felony criminal convictions. Amongst his prior convictions are four prior felony convictions related to drugs, including three prior convictions for drug distribution. In April 2017, Parker had recently been released after spending nearly a decade in prison for a burglary conviction.
On October 11, 2018, Jervonie Murphy, age 26, from Dubuque, Iowa, received a sentence of 33 months’ imprisonment following a May 21, 2018, guilty plea to two counts of distributing heroin within 1,000 feet of a public playground or school in Dubuque.
At the sentencing hearing, Murphy admitted he sold at least 80 grams of heroin between 2015 and 2018. On July 18, 2016,Murphy sold heroin to a woman. That woman shared some of the heroin with another woman who used the heroin and was found unresponsive the next morning. She never recovered and was pronounced dead on July 20, 2016. An autopsy revealed that the woman died of “mixed drug toxicity” involving methamphetamine and heroin.
Information presented at the sentencing also showed that less than two weeks later, Murphy again sold heroin. The Dubuque Drug Task Force eventually made two controlled buys of heroin from Murphy. One of the sales occurred within 1,000 feet of two playgrounds in Dubuque. The second controlled buy occurred within 1,000 feet of an elementary school. Officers then searched Murphy’s home and found marijuana, crack cocaine, powder cocaine, heroin, and fentanyl.
Murphy had no felony criminal convictions prior to this offense.
On October 11, 2018, Jay Rickert, age 28, from Grand Rapids, Michigan, received a sentence of 18 months’ imprisonment following a June 14, 2018, guilty plea to willfully causing the distribution of a controlled substance.
According to information disclosed at sentencing and in sentencing documents, Rickert admitted to ordering DMT, an illegal hallucinogenic drug, from an on-line supplier on the dark web. Rickert had the drugs shipped directly to his friend, a 22-year‑old woman who lived in Dubuque, Iowa. He also shipped a precise digital scale to the woman, and provided her detailed instructions on the quantity of DMT she could safely use.
Unbeknownst to either Rickert or the woman in Dubuque, the dark web supplier shipped fentanyl instead of DMT. DMT and Fentanyl are nearly identical in appearance. The woman, believing the substance to be DMT, used the fentanyl and died. Rickert was talking to the woman over Skype while she used the fentanyl. After seeing her fall over, Rickert called 911. An autopsy later concluded that the cause of death was a fentanyl overdose.
Rickert had no criminal history prior to this conviction.
The pictures below show how similar DMT is to Fentanyl in appearance. The picture on the left is of DMT and the picture on the right is Fentanyl.
All three men were sentenced in Cedar Rapids by United States District Court Judge Linda R. Reade. They are being held in the United States Marshal’s custody until they can be transported to a federal prison. There is no parole in the federal system.
The cases were prosecuted by Assistant United States Attorneys Dan Chatham and Justin Lightfoot and investigated by the Dubuque Drug Task Force, the Dubuque Police Department, the Dubuque County Sheriff’s Department, and the Drug Enforcement Administration (DEA).
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number are 17-CR-1034 (Parker), 18-CR-1010 (Murphy), and 18-CR-1008 (Rickert).
Greenbelt, Maryland – U.S. District Judge Paul W. Grimm today sentenced Rakesh Kaushal, age 66, of Rockville, Maryland, to three years in federal prison, followed by three years of supervised release, for the federal charge of conspiracy to commit wire fraud, in connection with a scheme to defraud his employer of more than $1.7 million. Judge Grimm also ordered Kaushal to pay restitution with the exact amount to be determined at a later hearing.
The guilty plea was announced by United States Attorney for the District of Maryland Robert K. Hur and Special Agent in Charge Jennifer C. Boone of the Federal Bureau of Investigation, Baltimore Field Office.
According to his plea agreement, between August 2015 and approximately January 2017, Kaushal was employed by a company headquartered in Beltsville, Maryland (Victim Company 1), which provided construction and design services, primarily to federal government agencies. Ivan Victor Thrane was the owner and president of three construction companies operating in Dickerson and Beltsville, Maryland (“the Thrane companies”). Kaushal recommended the Thrane companies to be subcontractors on Victim Company 1 projects for which Kaushal was the Project Manager or Project Executive.
Kaushal admitted that between August 2015 and January 2017, he conspired with Thrane to defraud Victim Company 1 by submitting fraudulent payment requests for work purportedly performed by the Thrane companies, which Kaushal reviewed and approved. In fact, the Thrane companies had not performed all of the work indicated on the payment requests and, in some cases, had not performed any work on projects for which payment was requested.
Specifically, Kaushal and Thrane, among other things, caused the Thrane companies to submit payment requests to Victim Company 1. Kaushal prepared the payment requests, which he e-mailed to Thrane. Thrane, or another individual at Thrane’s request, signed the payment requests on behalf of the Thrane companies. Thrane then e-mailed the signed payment requests to Kaushal, who, as Victim Company 1’s project manager and project executive, approved the payment requests, causing Victim Company 1 to pay the Thrane companies. Once payment was received from Victim Company 1, Thrane funneled a portion of those payments to Kaushal, typically by writing checks from his personal bank account or from the Thrane companies, which Kaushal then deposited into his personal bank account.
After Victim Company 1 discovered the overbilling in December 2016, Kaushal and Thrane attempted to conceal the scheme to defraud. For example, on December 28, 2016, Kaushal, using his work e-mail address, sent an e-mail to Thrane that read in part, “Good Morning Mr. Thrane: I have been informed by our accounting department that mistakenly we have overpaid your company for the MPO Skywalk Project. Can you please verify with your accounting and respond by COB today.” Other employees from Victim Company 1 were copied on this e-mail. In fact, Kaushal and Thrane had communicated prior to this e-mail regarding the discovery of overpayments by Victim Company 1. Kaushal and Thrane also agreed on a response, which Thrane then e-mailed to Kaushal, copying other employees from Victim Company 1. Thrane’s response read in part, “…please allow me to review our records with my accountant. My accountant is off this week. . . . Please rest assured that if there have been any overpayment to us by [Victim Company 1], we will return the overpayment immediately.” In fact, the Thrane companies did not have an accountant.
Shortly after the fraud was discovered by Victim Company 1, between January 17 and January 23, 2017, Kaushal wired a total of $650,000, including proceeds of the fraud, from one of his personal bank accounts to an account in India, with Kaushal listed as the beneficiary.
Victim Company 1 eventually initiated civil litigation against Kaushal and Thrane, and obtained a default judgment against Kaushal of $1,740,330. Kaushal then filed for Chapter 7 bankruptcy. During a meeting of creditors in the bankruptcy proceeding, Kaushal testified that he had used some of the proceeds of the fraud to purchase a condominium in India for a family member and that he had lost more than $100,000 gambling at various casinos. Kaushal was unable to account for more than $1 million of the kickback payments he received from Thrane. On May 15, 2019, the Bankruptcy Court entered a default judgment against Kaushal, denying him a discharge.
From approximately September 2015 to December 2016, Victim Company 1 paid the Thrane companies approximately $3,294,675.34 as a result of the scheme to defraud. Upon receipt of these payments from Victim Company 1, Thrane issued 34 kickback payments, totaling approximately $1,740,330 in checks written to Kaushal. On January 3, 2017, after discovering the fraud scheme, Victim Company 1 reversed or voided payments totaling approximately $741,525 to the Thrane companies. Kaushal then provided Thrane with three checks, all dated January 4, 2017, from Kaushal and made payable to one of the Thrane companies, totaling $370,700.06. Kaushal admits that the loss attributable to him as a result of the scheme is between $1.5 million and $3.5 million.
Ivan Victor Thrane, age 65, of Dickerson, Maryland, pleaded guilty to his role in the scheme on August 22, 2019. Judge Grimm has not yet set a date for sentencing.
Kaushal remains detained.
United States Attorney Robert K. Hur commended the FBI for its work in the investigation. Mr. Hur thanked Assistant U.S. Attorneys Jessica Collins and Gregory Bernstein, who prosecuted the case.
# # #
Greenbelt, Maryland – Rakesh Kaushal, age 66, of Rockville, Maryland, pleaded guilty today to the federal charge of conspiracy to commit wire fraud, in connection with a scheme to defraud his employer of more than $1.7 million.
The guilty plea was announced by United States Attorney for the District of Maryland Robert K. Hur and Special Agent in Charge Jennifer C. Boone of the Federal Bureau of Investigation, Baltimore Field Office.
According to his plea agreement, between August 2015 and approximately January 2017, Kaushal was employed by a company headquartered in Beltsville, Maryland (Victim Company 1), which provided construction and design services, primarily to federal government agencies. Ivan Victor Thrane was the owner and president of three construction companies operating in Dickerson and Beltsville, Maryland (“the Thrane companies”). Kaushal recommended the Thrane companies to be subcontractors on Victim Company 1 projects for which Kaushal was the Project Manager or Project Executive.
Kaushal admitted that between August 2015 and January 2017, he conspired with Thrane to defraud Victim Company 1 by submitting fraudulent payment requests for work purportedly performed by the Thrane companies, which Kaushal reviewed and approved. In fact, the Thrane companies had not performed all of the work indicated on the payment requests and, in some cases, had not performed any work on projects for which payment was requested.
Specifically, Kaushal and Thrane, among other things, caused the Thrane companies to submit payment requests to Victim Company 1. Kaushal prepared the payment requests, which he e-mailed to Thrane. Thrane, or another individual at Thrane’s request, signed the payment requests on behalf of the Thrane companies. Thrane then e-mailed the signed payment requests to Kaushal, who, as Victim Company 1’s project manager and project executive, approved the payment requests, causing Victim Company 1 to pay the Thrane companies. Once payment was received from Victim Company 1, Thrane funneled a portion of those payments to Kaushal, typically by writing checks from his personal bank account or from the Thrane companies, which Kaushal then deposited into his personal bank account.
After Victim Company 1 discovered the overbilling in December 2016, Kaushal and Thrane attempted to conceal the scheme to defraud. For example, on December 28, 2016, Kaushal, using his work e-mail address, sent an e-mail to Thrane that read in part, “Good Morning Mr. Thrane: I have been informed by our accounting department that mistakenly we have overpaid your company for the MPO Skywalk Project. Can you please verify with your accounting and respond by COB today.” Other employees from Victim Company 1 were copied on this e-mail. In fact, Kaushal and Thrane had communicated prior to this e-mail regarding the discovery of overpayments by Victim Company 1. Kaushal and Thrane also agreed on a response, which Thrane then e-mailed to Kaushal, copying other employees from Victim Company 1. Thrane’s response read in part, “…please allow me to review our records with my accountant. My accountant is off this week. . . . Please rest assured that if there have been any overpayment to us by [Victim Company 1], we will return the overpayment immediately.” In fact, the Thrane companies did not have an accountant.
Shortly after the fraud was discovered by Victim Company 1, between January 17 and January 23, 2017, Kaushal wired a total of $650,000, including proceeds of the fraud, from one of his personal bank accounts to an account in India, with Kaushal listed as the beneficiary.
Victim Company 1 eventually initiated civil litigation against Kaushal and Thrane, and obtained a default judgment against Kaushal of $1,740,330. Kaushal then filed for Chapter 7 bankruptcy. During a meeting of creditors in the bankruptcy proceeding, Kaushal testified that he had used some of the proceeds of the fraud to purchase a condominium in India for a family member and that he had lost more than $100,000 gambling at various casinos. Kaushal was unable to account for more than $1 million of the kickback payments he received from Thrane. On May 15, 2019, the Bankruptcy Court entered a default judgment against Kaushal, denying him a discharge.
From approximately September 2015 to December 2016, Victim Company 1 paid the Thrane companies approximately $3,294,675.34 as a result of the scheme to defraud. Upon receipt of these payments from Victim Company 1, Thrane issued 34 kickback payments, totaling approximately $1,740,330 in checks written to Kaushal. On January 3, 2017, after discovering the fraud scheme, Victim Company 1 reversed or voided payments totaling approximately $741,525 to the Thrane companies. Kaushal then provided Thrane with three checks, all dated January 4, 2017, from Kaushal and made payable to one of the Thrane companies, totaling $370,700.06. Kaushal admits that the loss attributable to him as a result of the scheme is between $1.5 million and $3.5 million.
Ivan Victor Thrane, age 65, of Dickerson, Maryland, pleaded guilty to his role in the scheme on August 22, 2019, and is scheduled to be sentenced on January 7, 2020.
As part of their plea agreements, Kaushal and Thrane are required to forfeit and pay restitution in the full amount of the victim’s losses still outstanding, which is at least $988,805.
Kaushal faces a maximum sentence of 20 years in prison for the wire fraud conspiracy. U.S. District Judge Paul W. Grimm has scheduled sentencing for January 14, 2020. Kaushal remains detained.
United States Attorney Robert K. Hur commended the FBI for its work in the investigation. Mr. Hur thanked Assistant U.S. Attorneys Jessica Collins and Gregory Bernstein, who are prosecuting the case.
# # #
Greenbelt, Maryland – Ivan Victor Thrane, age 65, of Dickerson, Maryland, pleaded guilty today to conspiracy to commit wire fraud, in connection with a scheme to defraud a company of more than $1.7 million.
The guilty plea was announced by United States Attorney for the District of Maryland Robert K. Hur and Special Agent in Charge Jennifer C. Boone of the Federal Bureau of Investigation, Baltimore Field Office.
According to his plea agreement, Thrane was the owner and president of three construction companies operating in Dickerson and Beltsville, Maryland (“the Thrane companies”). Thrane admitted that between August 2015 and January 2017, he conspired with the project manager at Victim Company 1, to defraud Victim Company 1 by submitting fraudulent payment requests for work purportedly performed by the Thrane companies. In fact, the Thrane companies had not performed all of the work indicated on the payment requests and, in some cases, had not performed any work on projects for which Thrane was requesting payment.
Specifically, Thrane and his co-conspirator, among other things, caused the Thrane companies to submit payment requests to Victim Company 1. The co-conspirator prepared the payment requests, which he e-mailed to Thrane. Thrane, or another individual at Thrane’s request, signed the payment requests on behalf of the Thrane companies. Thrane then e-mailed the signed payment requests to the co-conspirator, who, as Victim Company 1’s project manager and project executive, approved the payment requests, causing Victim Company 1 to pay the Thrane companies. Once payment was received from Victim Company 1, Thrane funneled a portion of those payments to his co-conspirator, typically by writing checks from his personal bank account or from the Thrane companies.
After Victim Company 1 discovered the overbilling by the Thrane companies in December 2016, Thrane and his co-conspirator attempted to conceal the scheme to defraud. For example, on December 28, 2016, Thrane and his co-conspirator sent each other e-mails, which they had previously discussed. Specifically, Thrane sent an e-mail to his co-conspirator and copying other employees from Victim Company 1, which read in part, “…please allow me to review our records with my accountant. My accountant is off this week. . . . Please rest assured that if there have been any overpayment to us by [Victim Company 1], we will return the overpayment immediately.” In fact, the Thrane companies did not have an accountant.
Victim Company 1 eventually initiated civil litigation against Thrane and his co-conspirator. Thrane and the co-conspirator coordinated their defense and falsely claimed that an employee of Victim Company 1 authorized the overbilling in order to obtain funds to purchase Victim Company 1. In fact, that employee did not even start working at Victim Company 1 until after Thrane and his co-conspirator had begun their fraud scheme and that employee did not authorize Thrane or Thrane companies to submit inflated payment requests.
From approximately September 2015 to December 2016, Victim Company 1 paid the Thrane companies approximately $3,294,675.34 as a result of payment requests submitted as part of the conspiracy and scheme to defraud. Upon receipt of these payments from Victim Company 1, Thrane issued approximately 34 kickback payments, totaling approximately $1,740,330 in checks written to his co-conspirator. On January 3, 2017, after discovering the fraud scheme, Victim Company 1 reversed or voided payments totaling approximately $741,525 to the Thrane companies. Thrane admits that the actual and intended loss attributable to him as a result of the scheme is between $1.5 million and $3.5 million.
As part of his plea agreement, Thrane is required to forfeit and pay restitution in the full amount of the victim’s losses still outstanding, which is at least $988,805.
Thrane faces a maximum sentence of 20 years in prison for the wire fraud conspiracy. U.S. District Judge Paul W. Grimm has scheduled sentencing for January 7, 2020.
In a separate indictment, Rakesh Kaushal, age 66, of Rockville, Maryland is charged with conspiracy to commit wire fraud in connection with the scheme. No trial date has been set and Kaushal remains detained. An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.
United States Attorney Robert K. Hur commended the FBI for its work in the investigation. Mr. Hur thanked Assistant U.S. Attorneys Jessica Collins and Gregory Bernstein, who are prosecuting the case.
Description: The fiscal year of the data file obtained from the AOUSC
Format: YYYY
Description: The code of the federal judicial circuit where the case was located
Format: A2
Description: The code of the federal judicial district where the case was located
Format: A2
Description: The code of the district office where the case was located
Format: A2
Description: Docket number assigned by the district to the case
Format: A7
Description: A unique number assigned to each defendant in a case which cannot be modified by the court
Format: A3
Description: A unique number assigned to each defendant in a case which can be modified by the court
Format: A3
Description: A sequential number indicating whether a case is an original proceeding or a reopen
Format: N5
Description: Case type associated with the current defendant record
Format: A2
Description: A concatenation of district, office, docket number, case type, defendant number, and reopen sequence number
Format: A18
Description: A concatenation of district, office, docket number, case type, and reopen sequence number
Format: A15
Description: The status of the defendant as assigned by the AOUSC
Format: A2
Description: A code indicating the fugitive status of a defendant
Format: A1
Description: The date upon which a defendant became a fugitive
Format: YYYYMMDD
Description: The date upon which a fugitive defendant was taken into custody
Format: YYYYMMDD
Description: The date when a case was first docketed in the district court
Format: YYYYMMDD
Description: The date upon which proceedings in a case commenced on charges pending in the district court where the defendant appeared, or the date of the defendant’s felony-waiver of indictment
Format: YYYYMMDD
Description: A code used to identify the nature of the proceeding
Format: N2
Description: The date when a defendant first appeared before a judicial officer in the district court where a charge was pending
Format: YYYYMMDD
Description: A code indicating the event by which a defendant appeared before a judicial officer in the district court where a charge was pending
Format: A2
Description: A code indicating the type of legal counsel assigned to a defendant
Format: N2
Description: The title and section of the U.S. Code applicable to the offense committed which carried the highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE1
Format: N2
Description: The four digit AO offense code associated with FTITLE1
Format: A4
Description: The four digit D2 offense code associated with FTITLE1
Format: A4
Description: A code indicating the severity associated with FTITLE1
Format: A3
Description: The FIPS code used to indicate the county or parish where an offense was committed
Format: A5
Description: The date of the last action taken on the record
Format: YYYYMMDD
Description: The date upon which judicial proceedings before the court concluded
Format: YYYYMMDD
Description: The date upon which the final sentence is recorded on the docket
Format: YYYYMMDD
Description: The date upon which the case was closed
Format: YYYYMMDD
Description: The total fine imposed at sentencing for all offenses of which the defendant was convicted and a fine was imposed
Format: N8
Description: A count of defendants filed including inter-district transfers
Format: N1
Description: A count of defendants filed excluding inter-district transfers
Format: N1
Description: A count of original proceedings commenced
Format: N1
Description: A count of defendants filed whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants terminated including interdistrict transfers
Format: N1
Description: A count of defendants terminated excluding interdistrict transfers
Format: N1
Description: A count of original proceedings terminated
Format: N1
Description: A count of defendants terminated whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants pending as of the last day of the period including long term fugitives
Format: N1
Description: A count of defendants pending as of the last day of the period excluding long term fugitives
Format: N1
Description: The source from which the data were loaded into the AOUSC’s NewSTATS database
Format: A10
Description: A sequential number indicating the iteration of the defendant record
Format: N2
Description: The date the record was loaded into the AOUSC’s NewSTATS database
Format: YYYYMMDD
Description: Statistical year ID label on data file obtained from the AOUSC which represents termination year
Greenbelt, Maryland – U.S. District Judge Paul W. Grimm today sentenced Rakesh Kaushal, age 66, of Rockville, Maryland, to three years in federal prison, followed by three years of supervised release, for the federal charge of conspiracy to commit wire fraud, in connection with a scheme to defraud his employer of more than $1.7 million. Judge Grimm also ordered Kaushal to pay restitution with the exact amount to be determined at a later hearing.
The guilty plea was announced by United States Attorney for the District of Maryland Robert K. Hur and Special Agent in Charge Jennifer C. Boone of the Federal Bureau of Investigation, Baltimore Field Office.
According to his plea agreement, between August 2015 and approximately January 2017, Kaushal was employed by a company headquartered in Beltsville, Maryland (Victim Company 1), which provided construction and design services, primarily to federal government agencies. Ivan Victor Thrane was the owner and president of three construction companies operating in Dickerson and Beltsville, Maryland (“the Thrane companies”). Kaushal recommended the Thrane companies to be subcontractors on Victim Company 1 projects for which Kaushal was the Project Manager or Project Executive.
Kaushal admitted that between August 2015 and January 2017, he conspired with Thrane to defraud Victim Company 1 by submitting fraudulent payment requests for work purportedly performed by the Thrane companies, which Kaushal reviewed and approved. In fact, the Thrane companies had not performed all of the work indicated on the payment requests and, in some cases, had not performed any work on projects for which payment was requested.
Specifically, Kaushal and Thrane, among other things, caused the Thrane companies to submit payment requests to Victim Company 1. Kaushal prepared the payment requests, which he e-mailed to Thrane. Thrane, or another individual at Thrane’s request, signed the payment requests on behalf of the Thrane companies. Thrane then e-mailed the signed payment requests to Kaushal, who, as Victim Company 1’s project manager and project executive, approved the payment requests, causing Victim Company 1 to pay the Thrane companies. Once payment was received from Victim Company 1, Thrane funneled a portion of those payments to Kaushal, typically by writing checks from his personal bank account or from the Thrane companies, which Kaushal then deposited into his personal bank account.
After Victim Company 1 discovered the overbilling in December 2016, Kaushal and Thrane attempted to conceal the scheme to defraud. For example, on December 28, 2016, Kaushal, using his work e-mail address, sent an e-mail to Thrane that read in part, “Good Morning Mr. Thrane: I have been informed by our accounting department that mistakenly we have overpaid your company for the MPO Skywalk Project. Can you please verify with your accounting and respond by COB today.” Other employees from Victim Company 1 were copied on this e-mail. In fact, Kaushal and Thrane had communicated prior to this e-mail regarding the discovery of overpayments by Victim Company 1. Kaushal and Thrane also agreed on a response, which Thrane then e-mailed to Kaushal, copying other employees from Victim Company 1. Thrane’s response read in part, “…please allow me to review our records with my accountant. My accountant is off this week. . . . Please rest assured that if there have been any overpayment to us by [Victim Company 1], we will return the overpayment immediately.” In fact, the Thrane companies did not have an accountant.
Shortly after the fraud was discovered by Victim Company 1, between January 17 and January 23, 2017, Kaushal wired a total of $650,000, including proceeds of the fraud, from one of his personal bank accounts to an account in India, with Kaushal listed as the beneficiary.
Victim Company 1 eventually initiated civil litigation against Kaushal and Thrane, and obtained a default judgment against Kaushal of $1,740,330. Kaushal then filed for Chapter 7 bankruptcy. During a meeting of creditors in the bankruptcy proceeding, Kaushal testified that he had used some of the proceeds of the fraud to purchase a condominium in India for a family member and that he had lost more than $100,000 gambling at various casinos. Kaushal was unable to account for more than $1 million of the kickback payments he received from Thrane. On May 15, 2019, the Bankruptcy Court entered a default judgment against Kaushal, denying him a discharge.
From approximately September 2015 to December 2016, Victim Company 1 paid the Thrane companies approximately $3,294,675.34 as a result of the scheme to defraud. Upon receipt of these payments from Victim Company 1, Thrane issued 34 kickback payments, totaling approximately $1,740,330 in checks written to Kaushal. On January 3, 2017, after discovering the fraud scheme, Victim Company 1 reversed or voided payments totaling approximately $741,525 to the Thrane companies. Kaushal then provided Thrane with three checks, all dated January 4, 2017, from Kaushal and made payable to one of the Thrane companies, totaling $370,700.06. Kaushal admits that the loss attributable to him as a result of the scheme is between $1.5 million and $3.5 million.
Ivan Victor Thrane, age 65, of Dickerson, Maryland, pleaded guilty to his role in the scheme on August 22, 2019. Judge Grimm has not yet set a date for sentencing.
Kaushal remains detained.
United States Attorney Robert K. Hur commended the FBI for its work in the investigation. Mr. Hur thanked Assistant U.S. Attorneys Jessica Collins and Gregory Bernstein, who prosecuted the case.
# # #
Greenbelt, Maryland – Rakesh Kaushal, age 66, of Rockville, Maryland, pleaded guilty today to the federal charge of conspiracy to commit wire fraud, in connection with a scheme to defraud his employer of more than $1.7 million.
The guilty plea was announced by United States Attorney for the District of Maryland Robert K. Hur and Special Agent in Charge Jennifer C. Boone of the Federal Bureau of Investigation, Baltimore Field Office.
According to his plea agreement, between August 2015 and approximately January 2017, Kaushal was employed by a company headquartered in Beltsville, Maryland (Victim Company 1), which provided construction and design services, primarily to federal government agencies. Ivan Victor Thrane was the owner and president of three construction companies operating in Dickerson and Beltsville, Maryland (“the Thrane companies”). Kaushal recommended the Thrane companies to be subcontractors on Victim Company 1 projects for which Kaushal was the Project Manager or Project Executive.
Kaushal admitted that between August 2015 and January 2017, he conspired with Thrane to defraud Victim Company 1 by submitting fraudulent payment requests for work purportedly performed by the Thrane companies, which Kaushal reviewed and approved. In fact, the Thrane companies had not performed all of the work indicated on the payment requests and, in some cases, had not performed any work on projects for which payment was requested.
Specifically, Kaushal and Thrane, among other things, caused the Thrane companies to submit payment requests to Victim Company 1. Kaushal prepared the payment requests, which he e-mailed to Thrane. Thrane, or another individual at Thrane’s request, signed the payment requests on behalf of the Thrane companies. Thrane then e-mailed the signed payment requests to Kaushal, who, as Victim Company 1’s project manager and project executive, approved the payment requests, causing Victim Company 1 to pay the Thrane companies. Once payment was received from Victim Company 1, Thrane funneled a portion of those payments to Kaushal, typically by writing checks from his personal bank account or from the Thrane companies, which Kaushal then deposited into his personal bank account.
After Victim Company 1 discovered the overbilling in December 2016, Kaushal and Thrane attempted to conceal the scheme to defraud. For example, on December 28, 2016, Kaushal, using his work e-mail address, sent an e-mail to Thrane that read in part, “Good Morning Mr. Thrane: I have been informed by our accounting department that mistakenly we have overpaid your company for the MPO Skywalk Project. Can you please verify with your accounting and respond by COB today.” Other employees from Victim Company 1 were copied on this e-mail. In fact, Kaushal and Thrane had communicated prior to this e-mail regarding the discovery of overpayments by Victim Company 1. Kaushal and Thrane also agreed on a response, which Thrane then e-mailed to Kaushal, copying other employees from Victim Company 1. Thrane’s response read in part, “…please allow me to review our records with my accountant. My accountant is off this week. . . . Please rest assured that if there have been any overpayment to us by [Victim Company 1], we will return the overpayment immediately.” In fact, the Thrane companies did not have an accountant.
Shortly after the fraud was discovered by Victim Company 1, between January 17 and January 23, 2017, Kaushal wired a total of $650,000, including proceeds of the fraud, from one of his personal bank accounts to an account in India, with Kaushal listed as the beneficiary.
Victim Company 1 eventually initiated civil litigation against Kaushal and Thrane, and obtained a default judgment against Kaushal of $1,740,330. Kaushal then filed for Chapter 7 bankruptcy. During a meeting of creditors in the bankruptcy proceeding, Kaushal testified that he had used some of the proceeds of the fraud to purchase a condominium in India for a family member and that he had lost more than $100,000 gambling at various casinos. Kaushal was unable to account for more than $1 million of the kickback payments he received from Thrane. On May 15, 2019, the Bankruptcy Court entered a default judgment against Kaushal, denying him a discharge.
From approximately September 2015 to December 2016, Victim Company 1 paid the Thrane companies approximately $3,294,675.34 as a result of the scheme to defraud. Upon receipt of these payments from Victim Company 1, Thrane issued 34 kickback payments, totaling approximately $1,740,330 in checks written to Kaushal. On January 3, 2017, after discovering the fraud scheme, Victim Company 1 reversed or voided payments totaling approximately $741,525 to the Thrane companies. Kaushal then provided Thrane with three checks, all dated January 4, 2017, from Kaushal and made payable to one of the Thrane companies, totaling $370,700.06. Kaushal admits that the loss attributable to him as a result of the scheme is between $1.5 million and $3.5 million.
Ivan Victor Thrane, age 65, of Dickerson, Maryland, pleaded guilty to his role in the scheme on August 22, 2019, and is scheduled to be sentenced on January 7, 2020.
As part of their plea agreements, Kaushal and Thrane are required to forfeit and pay restitution in the full amount of the victim’s losses still outstanding, which is at least $988,805.
Kaushal faces a maximum sentence of 20 years in prison for the wire fraud conspiracy. U.S. District Judge Paul W. Grimm has scheduled sentencing for January 14, 2020. Kaushal remains detained.
United States Attorney Robert K. Hur commended the FBI for its work in the investigation. Mr. Hur thanked Assistant U.S. Attorneys Jessica Collins and Gregory Bernstein, who are prosecuting the case.
# # #
Greenbelt, Maryland – Ivan Victor Thrane, age 65, of Dickerson, Maryland, pleaded guilty today to conspiracy to commit wire fraud, in connection with a scheme to defraud a company of more than $1.7 million.
The guilty plea was announced by United States Attorney for the District of Maryland Robert K. Hur and Special Agent in Charge Jennifer C. Boone of the Federal Bureau of Investigation, Baltimore Field Office.
According to his plea agreement, Thrane was the owner and president of three construction companies operating in Dickerson and Beltsville, Maryland (“the Thrane companies”). Thrane admitted that between August 2015 and January 2017, he conspired with the project manager at Victim Company 1, to defraud Victim Company 1 by submitting fraudulent payment requests for work purportedly performed by the Thrane companies. In fact, the Thrane companies had not performed all of the work indicated on the payment requests and, in some cases, had not performed any work on projects for which Thrane was requesting payment.
Specifically, Thrane and his co-conspirator, among other things, caused the Thrane companies to submit payment requests to Victim Company 1. The co-conspirator prepared the payment requests, which he e-mailed to Thrane. Thrane, or another individual at Thrane’s request, signed the payment requests on behalf of the Thrane companies. Thrane then e-mailed the signed payment requests to the co-conspirator, who, as Victim Company 1’s project manager and project executive, approved the payment requests, causing Victim Company 1 to pay the Thrane companies. Once payment was received from Victim Company 1, Thrane funneled a portion of those payments to his co-conspirator, typically by writing checks from his personal bank account or from the Thrane companies.
After Victim Company 1 discovered the overbilling by the Thrane companies in December 2016, Thrane and his co-conspirator attempted to conceal the scheme to defraud. For example, on December 28, 2016, Thrane and his co-conspirator sent each other e-mails, which they had previously discussed. Specifically, Thrane sent an e-mail to his co-conspirator and copying other employees from Victim Company 1, which read in part, “…please allow me to review our records with my accountant. My accountant is off this week. . . . Please rest assured that if there have been any overpayment to us by [Victim Company 1], we will return the overpayment immediately.” In fact, the Thrane companies did not have an accountant.
Victim Company 1 eventually initiated civil litigation against Thrane and his co-conspirator. Thrane and the co-conspirator coordinated their defense and falsely claimed that an employee of Victim Company 1 authorized the overbilling in order to obtain funds to purchase Victim Company 1. In fact, that employee did not even start working at Victim Company 1 until after Thrane and his co-conspirator had begun their fraud scheme and that employee did not authorize Thrane or Thrane companies to submit inflated payment requests.
From approximately September 2015 to December 2016, Victim Company 1 paid the Thrane companies approximately $3,294,675.34 as a result of payment requests submitted as part of the conspiracy and scheme to defraud. Upon receipt of these payments from Victim Company 1, Thrane issued approximately 34 kickback payments, totaling approximately $1,740,330 in checks written to his co-conspirator. On January 3, 2017, after discovering the fraud scheme, Victim Company 1 reversed or voided payments totaling approximately $741,525 to the Thrane companies. Thrane admits that the actual and intended loss attributable to him as a result of the scheme is between $1.5 million and $3.5 million.
As part of his plea agreement, Thrane is required to forfeit and pay restitution in the full amount of the victim’s losses still outstanding, which is at least $988,805.
Thrane faces a maximum sentence of 20 years in prison for the wire fraud conspiracy. U.S. District Judge Paul W. Grimm has scheduled sentencing for January 7, 2020.
In a separate indictment, Rakesh Kaushal, age 66, of Rockville, Maryland is charged with conspiracy to commit wire fraud in connection with the scheme. No trial date has been set and Kaushal remains detained. An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.
United States Attorney Robert K. Hur commended the FBI for its work in the investigation. Mr. Hur thanked Assistant U.S. Attorneys Jessica Collins and Gregory Bernstein, who are prosecuting the case.
Description: The fiscal year of the data file obtained from the AOUSC
Format: YYYY
Description: The code of the federal judicial circuit where the case was located
Format: A2
Description: The code of the federal judicial district where the case was located
Format: A2
Description: The code of the district office where the case was located
Format: A2
Description: Docket number assigned by the district to the case
Format: A7
Description: A unique number assigned to each defendant in a case which cannot be modified by the court
Format: A3
Description: A unique number assigned to each defendant in a case which can be modified by the court
Format: A3
Description: A sequential number indicating whether a case is an original proceeding or a reopen
Format: N5
Description: Case type associated with the current defendant record
Format: A2
Description: A concatenation of district, office, docket number, case type, defendant number, and reopen sequence number
Format: A18
Description: A concatenation of district, office, docket number, case type, and reopen sequence number
Format: A15
Description: The status of the defendant as assigned by the AOUSC
Format: A2
Description: A code indicating the fugitive status of a defendant
Format: A1
Description: The date upon which a defendant became a fugitive
Format: YYYYMMDD
Description: The date upon which a fugitive defendant was taken into custody
Format: YYYYMMDD
Description: The date when a case was first docketed in the district court
Format: YYYYMMDD
Description: The date upon which proceedings in a case commenced on charges pending in the district court where the defendant appeared, or the date of the defendant’s felony-waiver of indictment
Format: YYYYMMDD
Description: A code used to identify the nature of the proceeding
Format: N2
Description: The date when a defendant first appeared before a judicial officer in the district court where a charge was pending
Format: YYYYMMDD
Description: A code indicating the event by which a defendant appeared before a judicial officer in the district court where a charge was pending
Format: A2
Description: A code indicating the type of legal counsel assigned to a defendant
Format: N2
Description: The title and section of the U.S. Code applicable to the offense committed which carried the highest severity
Format: A20
Description: A code indicating the level of offense associated with FTITLE1
Format: N2
Description: The four digit AO offense code associated with FTITLE1
Format: A4
Description: The four digit D2 offense code associated with FTITLE1
Format: A4
Description: A code indicating the severity associated with FTITLE1
Format: A3
Description: The FIPS code used to indicate the county or parish where an offense was committed
Format: A5
Description: The date of the last action taken on the record
Format: YYYYMMDD
Description: The date upon which judicial proceedings before the court concluded
Format: YYYYMMDD
Description: The date upon which the final sentence is recorded on the docket
Format: YYYYMMDD
Description: The date upon which the case was closed
Format: YYYYMMDD
Description: The total fine imposed at sentencing for all offenses of which the defendant was convicted and a fine was imposed
Format: N8
Description: A count of defendants filed including inter-district transfers
Format: N1
Description: A count of defendants filed excluding inter-district transfers
Format: N1
Description: A count of original proceedings commenced
Format: N1
Description: A count of defendants filed whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants terminated including interdistrict transfers
Format: N1
Description: A count of defendants terminated excluding interdistrict transfers
Format: N1
Description: A count of original proceedings terminated
Format: N1
Description: A count of defendants terminated whose proceedings commenced by reopen, remand, appeal, or retrial
Format: N1
Description: A count of defendants pending as of the last day of the period including long term fugitives
Format: N1
Description: A count of defendants pending as of the last day of the period excluding long term fugitives
Format: N1
Description: The source from which the data were loaded into the AOUSC’s NewSTATS database
Format: A10
Description: A sequential number indicating the iteration of the defendant record
Format: N2
Description: The date the record was loaded into the AOUSC’s NewSTATS database
Format: YYYYMMDD
Description: Statistical year ID label on data file obtained from the AOUSC which represents termination year
Greenbelt, Maryland – U.S. District Judge Theodore D. Chuang today sentenced John Erasmus Frimpong, age 42, of Upper Marlboro, Maryland, to 114 months in federal prison, followed by three years of supervised release, for conspiracy to commit wire fraud, conspiracy to commit securities fraud, and securities fraud, in connection with a $28 million Ponzi scheme involving 1st Million, a purported wealth management and financial literacy company. Judge Chuang also ordered Frimpong to pay restitution, along with his co-defendants, in the full amount of the actual, total loss, including (1) $16,664,020 for the full amount of the victims’ losses relating to the 1st Million scheme to defraud; and (2) $797,775 for the full amount of losses caused by Frimpong’s separate scheme in which he contracted directly with individual victims purporting to invest on their behalf.
The sentence was announced by United States Attorney for the District of Maryland Erek L. Barron; Special Agent in Charge Thomas J. Sobocinski of the Federal Bureau of Investigation, Baltimore Field Office; Special Agent in Charge Matthew R. Stohler of the United States Secret Service - Washington Field Office; and Postal Inspector in Charge Damon E. Wood of the U.S. Postal Inspection Service - Washington
According to his plea agreement, Frimpong and his co-conspirators operated a Ponzi scheme through a Delaware incorporated business named The Smart Partners LLC, doing business as 1st Million LLC or 1st Million Dollars (“1st Million”). 1st Million presented itself as a wealth management and financial literacy company. Frimpong acted as 1st Million’s “Managing Partner” and “Chief Marketing Operator” and co-defendant Arley Ray Johnson acted as 1st Million’s “Chief Operating Officer” or “Director of Operations.”
Frimpong admitted that he made false and misleading representations to potential investors as to the nature and safety of the investments in 1st Million, the rates of return, and the experience, training and licensure of 1st Million and its principals. Specifically, Frimpong and his co-conspirators falsely claimed they would be investing victims’ money and that investors were being paid using the profits generated by the trading. Frimpong and other conspirators also falsely promised investors that their principal would be protected in a “trust” and returned in full upon the completion of the investment, regardless of market volatility. Frimpong and his co-conspirators further falsely promised extremely high rates of return. Many of these false promises were repeated not only by Frimpong, but also by “agents” who were given higher rates of return for bringing in investors. Frimpong also falsely told investors that he and 1st Million were “licensed” traders, and in compliance with all laws and U.S. Securities and Exchange Commission regulations.
In reality, Frimpong and his co-conspirators did not use investor funds for trading, nor did they place investor principal—or any investor funds—into a trust account. In fact, victim funds were not placed in a trust account or otherwise guaranteed. Neither Frimpong, nor anyone else at 1st Million had a license to offer securities or trade currency. In addition, Frimpong and his co-defendants falsely claimed that 1st Million was financially healthy and earning astronomical profits, but 1st Million’s accounts were frequently overdrawn and 1st Million had substantial cash flow problems, all of which Frimpong and his co-conspirators concealed from investors.
Frimpong and his co-conspirators used investor funds for personal gain, including cash and cryptocurrency transfers to themselves and family members. Frimpong and the co-conspirators used some investor funds to keep the scheme afloat, including by using investor funds to make payments to existing investors, leading those investors to believe that they were receiving “returns” on their investments as they had been promised. Frimpong and his co-defendant also used investor funds to pay office expenditures and fund lavish events at hotels in order to recruit additional investors.
As detailed in the plea agreement, Frimpong and his co-conspirators fraudulently solicited over $28.3 million from over 1,200 victims across the United States, including in Maryland, Texas, Florida, New York and Georgia.
By Spring 2019, 1st Million’s accounts were often overdrawn by hundreds of thousands of dollars, and some of the checks 1st Million sent to pay investors monthly returns were returned by the bank due to insufficient funds. Nevertheless, Frimpong continued to solicit funds from existing investors, as well as new investors, and failed to tell any of these potential investors of 1st Million’s financial problems. Ultimately, the scheme collapsed in May 2019 and hundreds of 1st Million investors collectively lost millions of dollars.
As the scheme started to collapse in the spring of 2019, Frimpong began his own separate scheme in which he contracted directly with individuals to invest on their behalf, again falsely promising to invest the money in foreign exchange, falsely promising sky-high returns, and falsely telling his clients that he was a duly-licensed trader. Frimpong admitted that he invested very little of these clients’ money and instead used hundreds of thousands of dollars of fraudulently obtained investment proceeds to fund his own lifestyle. Through this separate scheme, Frimpong misappropriated at least $1,499,751 in U.S. currency from individual victim investors.
Arley Ray Johnson, age 63, of Bowie, Maryland, was sentenced in January to78 months in federal prison for his role in the fraud scheme.
Dennis Jali fled the United States in May 2019, but has since been arrested in South Africa.
Separate civil actions filed against Frimpong and his co-defendants by the Securities and Exchange Commission and the U.S. Commodity Futures Trading Commission remain pending.
United States Attorney Erek L. Barron commended the FBI, the U.S. Secret Service, and the U.S. Postal Inspection Service for their work in the investigation. Mr. Barron thanked Assistant U.S. Attorneys Caitlin R. Cottingham and Jennifer L. Wine, who are prosecuting the case.
For more information on the Maryland U.S. Attorney’s Office, its priorities, and resources available to help the community, please visit www.justice.gov/usao-md and https://www.justice.gov/usao-md/report-fraud.
GREAT FALLS, MT – In an effort to combat the growing epidemic of prescription drug and heroin abuse, the FBI and DEA have released Chasing the Dragon: The Life of an Opiate Addict, a documentary aimed at educating students and young adults about the dangers of addiction. The film focuses on educating the public about the dangers of opioid addiction and features stark, first-person accounts by individuals who have abused opioids, or whose children have abused opioids with tragic consequences. According to the Centers for Disease Control and Prevention, 44 people die every day in America from an overdose of prescription painkillers. Since 2014, more than 14,000 people have died from prescription opioid overdoses alone.
The public is invited to a free viewing of the film on Wednesday, March 1, 2017 from 6:00 to 7:00pm at the Mansfield Theatre in the Civic Center (2 Park Drive, Great Falls). In addition, the public is welcome to attend, at the same location, a reception prior to the screening from 5-6pm and a post-screening discussion of issues related to opioid addiction with a panel of law enforcement and community professionals including Barbara Roach - Special Agent in Charge USDEA, Honorable Michael Cotter - US Attorney for the District of Montana, Honorable Judge Pinksi - Cascade County District Court Judge, Brian Lockerby - Administrator for MTDCI, Dr. Brad Nieset - Medical Director Benefis Outpatient Specialty Clinics, Nikki Phillips - BSN, Benefis Pain Management Clinic, and A Representative From The Addiction & Recovery Field.
United States Attorney Mike Cotter stated, “The rise of heroin use and the abuse of prescription opioids has devastated communities all over the United States. The best way to avoid that in Montana is to get our local communities to confront these issues early and often, and I can tell you, our local communities have responded, and are responding. I am proud to be a part of this effort and I look forward to seeing many of my former friends, neighbors and colleagues at this event.”
DEA Special Agent in Charge Barbra Roach stated, “The prescription opioid epidemic, and the subsequent rise in the use of heroin and other controlled substances, is one of the most important problems in our nation today. It’s become pervasive in our society, extending from metropolitan to rural areas, and it either touches us directly or those that we know. That is why events such as these are so important. We need to take the time to educate our communities, and our neighbors, on the risks inherent in the abuse of prescription pain killers. Forums like the one in Great Falls are the first, best step in addressing and correcting the problem.”
The event is a joint effort by GFPD, USDEA, Substance Abuse Prevention Alliance, Benefis Health Systems, MTDCI, Montana U.S. Attorney’s Office, and Big Sky Managed Care to educate community members of the growing opioid epidemic.
Fargo – United States Attorney Drew Wrigley announced that U.S. District Court Chief Judge Peter D. Welte sentenced Skylar Dayne Goodman, age 19 of Fargo, ND, to four days’ incarceration followed by three years of supervised released for attempting to derail a Burlington Northern Santa Fe (BNSF) train in violation of 18 U.S.C. § 1992(a)(1) and corruptly attempting to obstruct an official proceeding in violation of 18 U.S.C. § 1512(c)(2). Judge Welte also ordered Goodman to pay $3,124 in restitution to BNSF Railway.
On May 7, 2020, a BNSF train was traveling from Brenkenridge, Minnesota to Black Thunder Mine in Wyoming when it approached a crossing one mile west of Casselton at which point it encountered a rough track. The crew on the train immediately reported the rough track and that same evening a train inspector discovered a re-railer. A re-railer is a tool used by railroading contractors to place a train back on the track after a derailment and they’re capable of causing a train to derail. A Re-railer is typically painted bright yellow in the event it is inadvertently left on the track. The re-railer discovered on the railroad track on the evening of May 7, 2020, was spray-painted black.
An investigation by the BNSF and FBI revealed that Skylar Goodman placed the rerailer on the track on the evening of May 7, 2020. Following his arrest for attempting to derail the train, an acquaintance of the defendant’s contacted law enforcement with an incredulous story that exonerated the defendant. Further investigation by BNSF and the
FBI revealed that this individual was threatened by defendant to fabricate a story that falsely exonerated defendant’s involvement in the attempted train derailment.
"This defendant planned and attempted a serious attack on critical infrastructure and human life, and then he obstructed the federal investigation," said United States Attorney Drew Wrigley, who added that "while we respect the judge in this matter, we take strong exception to a sentence that allows the defendant to walk free, avoiding the applicable guideline sentence of 2 to 2-1/2 years in federal prison."
This case was investigated by the Federal Bureau of Investigation, BNSF Police Department and Cass County Sheriff’s Department, and was prosecuted by Assistant United States Attorney Jennifer Puhl.
RICHMOND, Va. – A Chesterfield County man was sentenced today to 30 years in prison and a lifetime of supervised release for producing child pornography.
According to court documents, beginning in December 2015 and continuing over several years, Joshua Clayton Brady, 36, made sexually explicit videos with multiple female victims between the ages of 14 and 16 using the internet application Skype. Brady met these victims on various dating websites, falsely representing himself as a member of one of two wealthy families in the United Kingdom and the United States. Brady sometimes threatened to expose the victims’ activities on those websites to their parents to coerce their participation in the sexual activity. Several years after recording one victim, Brady reapproached that victim when she was a college freshman. Brady then induced the victim to wire him money and allow him to use the victim’s credit cards by threatening to release the videos he had made previously. Brady engaged in similar conduct with adult women he had met on-line.
Jessica D. Aber, U.S. Attorney for the Eastern District of Virginia; Jason Miyares, Attorney General of Virginia; Stanley M. Meador, Special Agent in Charge of the FBI’s Richmond Field Office; and Wayne A. Jacobs, Special Agent in Charge of the FBI Washington Field Office Criminal Division, made the announcement after sentencing by Senior U.S. District Judge Henry E. Hudson.
Assistant U.S. Attorney Michael C. Moore and Special Assistant U.S. Attorney Samuel E. Fishel prosecuted the case.
This case was investigated by the FBI Washington Field Office’s Child Exploitation and Human Trafficking Task Force. The task force is composed of FBI agents, along with other federal agents and detectives from northern Virginia and the District of Columbia. The task force is charged with investigating and bringing federal charges against individuals engaged in the exploitation of children and those engaged in human trafficking.
In 2021, EDVA launched “UnMasked,” a community-based educational outreach and prevention program in Virginia dedicated to raising awareness and educating the community about the prevalence of online sexual exploitation involving children and young adults. UnMasked is a multi-disciplinary partnership of local, state, federal, and non-profit stakeholders. The core curriculum is provided by the National Center for Missing and Exploited Children’s (NCMEC) NetSmartz program. To report an incident involving online sexual exploitation, call 1-800-843-5678 or submit a report at report.cybertip.org. To request an UnMasked event at your school or organization, please contact EDVA’s Community Outreach Coordinator at USAVAE.UnMasked@usdoj.gov.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:21-cr-17.
The U.S. Attorney’s Office and our partners at Tulsa Metropolitan Ministry, Tulsa County Sheriff’s Office, Tulsa Crime Stoppers, and the Family Safety Center join communities nationwide in observing National Crime Victims’ Rights Week, April 18-24, 2021, announced Acting U.S. Attorney Clint Johnson. The week promotes victims' rights, celebrates progress made in the field, and honors crime victims. This year’s theme is “Support Victims. Build Trust. Engage Communities”.
“The U.S. Attorney’s Office for the Northern District of Oklahoma stands with victims of crime and their families. We also recognize the unwavering support and vital work that our law enforcement and community partners perform every day to secure victims’ rights and support survivors,” said Acting U.S. Attorney Clint Johnson. “This week my office and our partners invite the public to join us as we encourage and show support to victims of crime."
* Throughout the week, the public is invited to join the U.S. Attorney’s Office and our partners virtually as we observe National Crime Victims’ Rights Week on the U.S. Attorney’s Office’s social media sites (FB: @usaondok; Twitter: @USAO_NDOK). Starting Sunday, April 18, Acting U.S. Attorney Clint Johnson will kick off the week-long virtual awareness event. Also, Tulsa Mayor GT Bynum will share a proclamation in support of crime victims. Throughout the week, messages of support and resource information will be shared by law enforcement, victim services agencies, and faith-based organizations from northeastern Oklahoma. The public is encouraged to share and comment in support of victims.
* Sunday at dusk, also look for the sky to be illuminated pink, purple, or yellow by several Tulsa businesses in honor of victims of crime. Businesses include ONEOK, ONE GAS, Oklahomans for Equality, and KJRH Ch. 2. Other businesses are also welcome to join in support.
* Also, an in-person public event, “A Community Day of Hope,” will be held Friday, April 23, from 10 am to 2 pm at Tulsa’s Promenade Mall west parking lot, (4107 South Yale Ave.) The event will be held outside due to COVID-19 considerations. Approximately 35 law enforcement, victim services and community agencies will share public safety and victim resource information. The Tulsa Fire Department will also distribute 200 backpacks to the public.
* Nationally, the Justice Department’s Office for Victims of Crime recognizes individuals and organizations that demonstrate outstanding service in supporting victims. The 2021 National Crime Victims’ Service Awards Ceremony will be held virtually on April 23, 2021, from 3:00 to 4:30 pm eastern time. Learn more and register to watch the ceremony live. #NCVRW2021 https://go.usa.gov/xH3zv
Some 3.3 million Americans age 12 and older were victims of violent crime in 2018, according to the National Crime Victimization Survey. The Office for Victims of Crime (OVC), part of the Justice Department’s Office of Justice Programs, supports more than 7,000 local victim assistance programs and victim compensation programs in every state and U.S. territory. Funds for these programs come from the Crime Victims Fund, which is made up of federal criminal fines, penalties and bond forfeitures.
Ronald Reagan proclaimed the first Victims’ Rights Week in 1981, putting crime victims' rights, needs, and concerns in a prominent spot on the American agenda. He also established the President's Task Force on Victims of Crime, which laid the groundwork for a national network of services and legal safeguards for crime victims.
Agencies participating in “A Community Day of Hope” on April 23 at Tulsa’s Promenade Mall include:
U.S. Attorney’s Office for the Northern District of Oklahoma
Tulsa Crime Stoppers
Tulsa Metropolitan Ministry
Tulsa County Sheriff’s Office
Family Safety Center
Counseling & Recovery Services of Oklahoma
AAA
American Dream Center
Muscogee (Creek) Nation Family Violence Prevention Program
CASA
Oklahoma Department of Human Services - Adult Protective Services
Tulsa Fire Department
Traffic Safety Division/Oklahoma County Sheriff's Office/Oklahoma Highway Safety Office
FBI
Sand Springs Police Department
Tulsa Police Department Victim Witness Unit
Tulsa Police Department Community Engagement Unit
LIFE Senior Services
Oklahoma Highway Patrol
The Coffee Bunker
Surayya Anne Foundation Tulsa County District Attorney’s Office/Victim Witness Center
Wyandotte Nation Family Violence Prevention Program