title: MS-13 and Mexican Mafia Leader Sentenced to More than 17 Years for an International Drug Conspiracy

body_text: NEWS RELEASE SUMMARY – August 29, 2023 SAN DIEGO – Nelson Alexander Flores of Tijuana was sentenced in federal court to 210 months in prison for trafficking large quantities of methamphetamine into the United States from Mexico on behalf of MS-13 street gang and the Mexican Mafia prison gang. According to information presented in court, between 2018 and May 2020, Flores coordinated with and supplied others with pound quantities of methamphetamine from various sources in Mexico, which was then distributed throughout the United States. Flores is also serving a five-year sentence in federal prison for his role in an MS-13 RICO case to which he pleaded guilty in the Southern District of Ohio in United States v. Aguilar-River, et al. , case no. 2:17-CR-164. The court ruled that Flores’ term of imprisonment in the Southern District of California case will run consecutive to the term of imprisonment in the Southern District of Ohio RICO case. “This defendant was responsible for moving more than 100 pounds of methamphetamine and cocaine a month on behalf of violent international street and prison gangs,” said Acting U.S. Attorney Andrew R. Haden. “He imported these drugs into San Diego from Mexico, before they were sent to poison other communities throughout the United States. We were proud to partner with Joint Task Force Vulcan in this prosecution to fight back on behalf of the Southern District of California and our nation.” “The MS-13, Mexican Mafia, and their criminal partners fuel their criminal activities through the illicit importation and sale of narcotics,” said Director of Joint Task Force Vulcan (JTFV) John Durham. “Mr. Flores played a key role in MS-13’s international drug operations by coordinating the importation and distribution of narcotics throughout the United States, and his conviction and sentence mark a significant disruption. JTFV and our law enforcement partners will continue to work relentlessly to protect our communities from the plague of transnational organized crime.” Since its creation in August 2019, JTFV has successfully implemented a whole-of-government approach to combatting MS-13, including increasing coordination and collaboration with domestic and foreign law enforcement partners; designating priority MS-13 programs, cliques and leaders, who have the most impact on the United States, for targeted prosecutions; and coordinating significant MS-13 indictments, including the first use of national security charges against MS-13 leaders. JTFV has been comprised of members from U.S. Attorney’s Offices across the country, including this Office; the Eastern District of New York; the Eastern District of Texas; the District of New Jersey; the Northern District of Ohio; the District of Utah; the District of Massachusetts; the Southern District of Florida; the District of Alaska; the Southern District of California; the District of Nevada; the Eastern District of Virginia; and the District of Columbia, as well as the Department of Justice’s National Security Division and the Criminal Division. All Department of Justice law enforcement agencies are involved in the effort, including the FBI; DEA; the Bureau of Alcohol, Tobacco, Firearms and Explosives; the U.S. Marshals Service; and the U.S. Bureau of Prisons. In addition, HSI plays a critical role in JTFV. DEFENDANT Case Number 22cr908 Nelson Alexander Flores Age: 52 Tijuana, Mexico Aka “Mula,” aka “El 40,” aka “Cuarenta,” aka “Juan,” aka “Juanita” SUMMARY OF CHARGES International Drug Conspiracy – Title 21, United States Code, Sections 959, 960 & 963. Maximum penalty: Life in prison and $10 million fine. AGENCY Homeland Security Investigations Drug Enforcement Administration Federal Bureau of Investigation This case is the result of ongoing efforts by the Organized Crime Drug Enforcement Task Force (OCDETF), a partnership that brings together the combined expertise and unique abilities of federal, state and local law enforcement agencies. The principal mission of the OCDETF program is to identify, disrupt, dismantle and prosecute high-level members of drug trafficking, weapons trafficking and money laundering organizations and enterprises.


title: Former Auburn Physician Pays $135,000 and Forfeits DEA Registration,  for Overprescribing Controlled Substances

component: USAO - New York, Northern

body_text: SYRACUSE, NEW YORK – Dr. Jang Boo Chi, formerly a physician in Auburn, and his medical practice, Jang Boo Chi M.D. P.C., have agreed to pay the United States $135,000 in civil penalties for overprescribing opioids and other controlled substances in dangerous combinations. United States Attorney Carla B. Freedman, and Special Agent in Charge Frank A. Tarentino III, U.S. Drug Enforcement Administration (DEA), New York Division made the announcement. The Settlement Agreement resolves allegations that Dr. Chi wrote prescriptions for non-legitimate medical purposes, outside the usual course of a professional practice, in violation of the Controlled Substances Act. Specifically, the United States alleges that Dr. Chi allowed patient desires to dictate his prescribing decisions instead of his own medical judgment; he prescribed opioids, benzodiazepines, and carisoprodol in a dangerous combination known as the “Holy Trinity”; and he ignored red flags that the controlled substances he prescribed were being diverted for illicit use. Examples of admitted conduct include: Dr. Chi prescribed Hydrocodone-Acetaminophen, Diazepam (also known as “Valium”), and Carisoprodol (a muscle relaxant known as “Soma”) to Patient #1, even though drug screens indicated the patient was not taking the prescribed medications, while using MDMA (also known as “Molly” or “Ecstasy”), cocaine, and unprescribed Oxycodone. Patient #1 eventually died of acute intoxication by the combined effects of controlled substances- both prescribed, and unprescribed. Dr. Chi prescribed Adderall for Patient #2, to treat Attention-Deficit/Hyperactivity Disorder (ADHD), but the medical records lack a sufficient basis to establish an ADHD diagnosis. At various times, Dr. Chi encouraged Patient #2 to decrease their use of Adderall and to not take it with certain other medication, however when they did not, he continued prescribing it. In Patient #3’s case, Dr. Chi prescribed Fentanyl patches, Oxycodone, Percocet, Lorazepam, Lyrica, and Zolpidem, among several other controlled substances. During a hospitalization in 2018, another doctor noted Patient #3 “has a problem with polypharmacy” as they were on more than 20 different medications and supplements. Dr. Chi noted Patient #3’s medications were “heavy,” and that “…I felt too [they] take much medication…” (sic.) Dr. Chi did not further reduce the patient’s medications until September 2021, after the DEA questioned his prescribing practices. This $135,000 payment constitutes civil penalties under the Controlled Substances Act. Dr. Chi has surrendered his DEA registration, and, as part of the civil settlement, agreed not to seek a renewal for at least 15 years. This case was investigated by DEA Albany District Office’s Diversion Group, with assistance from the DHHS Office of Inspector General’s New York Region, the New York State Department of Health, Bureau of Narcotic Enforcement, and the Auburn Police Department. Assistant U.S. Attorney Christopher Moran represented the United States in this matter.


title: Akwesasne Man Pleads Guilty to Transporting Six Aliens

body_text: ALBANY, NEW YORK – Shane Barnes, age 38, of Akwesasne, New York, pled guilty today to transporting six aliens. United States Attorney Carla B. Freedman and Chief Patrol Agent Robert N. Garcia, United States Border Patrol, Swanton Sector made the announcement. In pleading guilty, Barnes admitted that on September 28, 2022, he drove a pickup truck to the riverbank of the U.S. side of the St. Regis River. Shortly after arriving at the riverbank, six aliens emerged from the woods and got into the pickup truck. The defendant then drove the aliens to Hogansburg, NY, and then to Bombay, NY. The defendant further admitted that he expected to be paid for transporting the aliens. Sentencing is scheduled for January 10, 2024, before United States District Judge David N. Hurd in Utica, New York. Barnes faces up to ten years in prison, a fine of up to $250,000, and a term of supervised release of up to three years. A defendant’s sentence is imposed by a judge based on the particular statute the defendant is charged with violating, the U.S. Sentencing Guidelines, and other factors. This case was investigated by the United States Border Patrol. The case is being prosecuted by Assistant U.S. Attorney Rick Belliss.


title: Convicted Sex Offender and Domestic Abuser Sentenced to Over 5 Years in Federal Prison After Being Caught with Firearm

component: USAO - Indiana, Southern

body_text: INDIANAPOLIS- Shaylor Goer, 47, of Indianapolis, Indiana, has been sentenced to 5 years and 3 months in federal prison after pleading guilty to illegally possessing a firearm. According to court documents, on March 31, 2022, IMPD officers were dispatched to Dearborn Street in Indianapolis, Indiana at 6 a.m. to investigate complaints of a suspicious individual. Upon arrival, officers saw Goer and requested that he stop. Goer did not comply, and instead ran down an alley, leading officers on a brief foot chase. Goer was eventually stopped and arrested. During a search of Goer’s person, officers found an empty gun holster on his hip. Officers searched the surrounding area and found a Kimber .45 caliber semiautomatic firearm on top of a trash can, belonging to Goer. Goer is prohibited by federal law from ever possessing a firearm due to his fourteen previous felony convictions including two counts of failure to register as a sex or violent offender, two counts of domestic battery, aggravated criminal sexual abuse of a minor between the age of 13-17, manufacture/distribution of a look-alike substance, unlawful possession of a syringe, possession of cocaine, and burglary. United States Attorney for the Southern District of Indiana, Zachary A. Myers, Daryl S. McCormick, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), Columbus Field Division, and IMPD Chief Randal Taylor made the announcement. “Individuals with a history of violence and criminal activity should never be able to get their hands on a firearm,” said U.S. Attorney for the Southern District of Indiana, Zachary A. Myers. “Under the L.E.A.T.H initiative, it is a priority of our office, IMPD, and ATF to weed out those who pose the highest risk to those closest to them and the community as a whole. Holding dangerous, repeat offenders accountable for illegally possessing firearms is a critical part of this initiative.” The Bureau of Alcohol, Tobacco, Firearms and Explosives and the Indianapolis Metropolitan Police Department investigated this case. The sentence was imposed by U.S. District Court Judge, James R. Sweeney. Judge Sweeney also ordered that Goer be supervised by the U.S. Probation Office for 3 years following his release from federal prison. U.S. Attorney Myers thanked Assistant United States Attorney Jeremy C. Fugate, who prosecuted this case. This case was brought as part of the LEATH Initiative (Law Enforcement Action to Halt Domestic Violence), named in honor of Indianapolis Metropolitan Police Department (IMPD) Officer Breann Leath, who was killed in the line of duty while responding to a domestic disturbance call. A partnership among the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), the IMPD, and the U.S. Attorney’s Office for the Southern District of Indiana, the LEATH Initiative focuses federal, state, and local law enforcement resources on domestic violence offenders who illegally possess firearms. ###


title: More Than a Dozen Charged in a Violent Crime Conspiracy That Includes Armed Carjacking, Armed Robbery

component: Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF)

body_text: Defendants Charged With Multiple Counts of Hobbs Act Robbery and Firearms Offenses WASHINGTON – A superseding indictment was unsealed today charging 16 alleged members (named below) of a violent crime ring that committed multiple armed carjackings, armed robberies, money laundering, and firearms offenses. Federal law enforcement arrested eight defendants this morning; the remaining defendants were previously arrested. Charges include conspiracy to interfere with interstate commerce (known as Hobbs Act) robbery, interference with interstate commerce by robbery, using a firearm in furtherance of a crime of violence, conspiracy to commit carjacking, and conspiracy to engage in monetary transaction in property derived from specified unlawful activity. The case was announced by United States Attorney Matthew M. Graves, Special Agent in Charge Craig Kailimai with the Washington Field Division of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), Assistant Director in Charge David Sundberg, of the FBI Washington Field Office’s (Criminal and Cyber Division), Special Agent in Charge James E. Dennehy, of the FBI’s Newark Field Office, Marshal Peter Marketos, of the United States Marshals Service, and Acting Chief Pamela Smith, of the Metropolitan Police Department. According to the indictment, between January 7, 2022, through January 27, 2023, the defendants conspired in the District of Columbia to commit robberies in New Jersey, Pennsylvania, Virginia, and Florida. The robberies targeted jewelry stores owned by Asian Americans. Disguised in dark clothing, masks, and gloves, armed with a gun, one or more of the defendants used various vehicles, including stolen vehicles, to commit and flee from the robberies, including: January 7, 2022: Yasini Jewelers in E. Falls Church, VA; June 10, 2022: Virani Jewelers in Iselin, NJ; September 20, 2022: Sonia Jewelers & Boutique, in Springfield, VA; October 25, 2022: Paradise Jewelry Store, in Paterson, NJ; November 10, 2022: Baral Jewelers & Gifts, in Harrisburg, PA; November 27, 2022: Sara Emporium Jewelry & Boutique, in Springfield, VA; December 6, 2022: Kishek Jewelers, in Jacksonville, FL; December 22, 2022: Chintamanis Inc., in Franklin Park, NJ; January 27, 2023: Princess Diamonds, in Falls Church, VA. The indictment further alleges that William Hunter, a/k/a “Ill Will,” conspired to commit carjackings between September 11, 2022 and October 22, 2022, with others. Defendants Wright, Avery Fuller, a/k/a “Deavry Cordell Fuller,” William Hunter, and Franklin Hunter, a/k/a “Gino,” conspired to launder the proceeds of the stolen property. "This indictment alleges a conspiracy to engage in a violent armed robbery spree involving commercial establishments throughout the Eastern Seaboard,” said U.S. Attorney Graves. “One defendant is also charged with conspiracy to commit carjacking as part of the spree, and others are charged with laundering the proceeds from the robberies. With an increasing number of robbery schemes that cross state lines, collaborative operations like this one are critical to holding accountable those who threaten the safety of our communities." “It is devastating that firearm-related violence such as the crimes committed throughout this investigation have become so prevalent within our communities,” said ATF Special Agent in Charge Craig Kailimai. “We will continue collaborating with our law enforcement partners by holding those individuals who seek to harm innocent people accountable for their actions.” “The defendants targeted small businesses along the East Coast, stealing hundreds of thousands of dollars' worth of jewelry from hardworking families,” said Assistant Director in Charge David Sundberg. “For the past 20 months, the FBI worked with our partners across state lines to connect the defendants to these heists. Today's indictment is a testament to the strength of our partnerships and the commitment we all share to eradicating violent crime.” “We allege these suspects took part in take-over style armed robberies meant to terrify and overwhelm store owners and employees,” said FBI-Newark Special Agent in Charge James Dennehy. “Many of the victim businesses are family owned and operated and lost large sums of inventory. The alleged violent and reckless actions of the subjects are astounding; they gave no thought to the people who could have been seriously injured or even killed. We have a message for criminals out there right now who believe these smash and grab robberies work in their favor because they mistakenly believe no one will hold them accountable. That’s not the case here – and it won’t be the case in the future. FBI Newark and our law enforcement partners will make sure if we can charge something federally, we will make that happen.” “I want to thank the detectives from MPD and the other agencies involved for their tireless work on this case. This is a prime example of how we, as law enforcement partners, come together as one to hold people accountable for committing crimes in the District of Columbia,” said Acting Chief of Police Pamela A. Smith of the Metropolitan Police Department of the District of Columbia. “While this investigation took time, the message is clear: If you choose to recklessly disregard public safety in D.C., we, collectively as law enforcement partners, will do everything to find you and hold you accountable.” NAME AGE ADDRESS CHARGES Andrew Smith aka “Drewso” or “Drew” 29 Maryland Hobbs Act Robbery; Conspiracy to commit Hobbs Act Robbery; Firearm in furtherance of a crime of violence Antonio Tate, aka “Motion” or “T-Motion” 20 Washington, D.C. Conspiracy to commit Hobbs Act Robbery Avery Fuller, aka “Ace”, “Fully”, or “Fully Ace” 28 Washington, D.C. Hobbs Act Robbery; Conspiracy to commit Hobbs Act Robbery; Firearm in furtherance of a crime of violence Davon Johnson, aka “Yb” 30 Washington, D.C. Hobbs Act Robbery; Conspiracy to commit Hobbs Act Robbery; Firearm in furtherance of a crime of violence Decarlos Hill, aka “Los” 29 Maryland Hobbs Act Robbery; Conspiracy to commit Hobbs Act Robbery; Firearm in furtherance of a crime of violence Delonte Martin, aka “DD” 25 Washington, D.C. Conspiracy to commit Hobbs Act Robbery Franklin Hunter, aka “Gino” 29 Washington, D.C. Hobbs Act Robbery; Conspiracy to commit Hobbs Act Robbery; Firearm in furtherance of a crime of violence Hesham Gomaa 45 Virginia Hobbs Act Robbery; Conspiracy to commit Hobbs Act Robbery; Firearm in furtherance of a crime of violence Jameise Christian, aka “Safe Play”, “Safety”, or “Safe” 32 Washington, D.C. Hobbs Act Robbery; Conspiracy to commit Hobbs Act Robbery; Firearm in furtherance of a crime of violence; Conspiracy to commit carjacking Jaylaun Brown, aka “Lil Launy” 21 Washington, D.C. Conspiracy to commit Hobbs Act Robbery Keith McDuffie 26 California Hobbs Act Robbery; Conspiracy to commit Hobbs Act Robbery; Firearm in furtherance of a crime of violence Robert Sheffield, aka “Real Lifaa” 32 Washington, D.C. Hobbs Act Robbery; Conspiracy to commit Hobbs Act Robbery; Firearm in furtherance of a crime of violence Timothy Conrad, aka “Twin” 32 Washington, D.C. Hobbs Act Robbery; Conspiracy to commit Hobbs Act Robbery; Firearm in furtherance of a crime of violence Trevor Wright, aka “Taliban Glizzy” 32 Washington, D.C. Hobbs Act Robbery; Conspiracy to commit Hobbs Act Robbery; Firearm in furtherance of a crime of violence William Hunter, aka “Ill Will” 28 Washington, D.C. Hobbs Act Robbery; Conspiracy to commit Hobbs Act Robbery; Firearm in furtherance of a crime of violence; Conspiracy to commit carjacking Lamont Marable 27 Washington, D.C. Hobbs Act Robbery; Conspiracy to commit Hobbs Act Robbery; Firearm in furtherance of a crime of violence Federal agents and local law enforcement arrested Smith, Johnson, Hill, Gomaa, Brown, McDuffie, Sheffield, and Conrad this morning; Wright, Hunter, Fuller, Tate, Martin, Brown, Christian, and Marable were already in custody. Search warrants were also executed resulting in the seizure of multiple guns and approximately $300,000 from a safe in one of the residences. The superseding indictment also contains a notice of forfeiture and seeks the proceeds of the illegal activities. The statutory maximum sentence for conspiracy to interfere with interstate commerce (known as Hobbs Act) robbery is 20 years; the statutory maximum sentence of Hobbs Act robbery is 20 years in prison; the crime of using a firearm in furtherance of a crime of violence carries a mandatory minimum sentence of seven years with a maximum possible sentence of life; the statutory maximum sentence for conspiracy to commit carjacking is five years in prison; the statutory maximum sentence for money laundering is 20 years. A federal judge will determine the appropriate sentence after considering the appropriate sentencing guidelines and other factors. This case was investigated by the ATF’s Washington Field Division, the FBI’s Washington and Newark Field Offices, the United States Marshal Service, and the Metropolitan Police Department, with substantial assistance from the police departments of: Fairfax County (VA), Falls Church (VA), Franklin Township (NJ), Jersey City (NJ), Paterson (NJ), Middlesex County (NJ), South Brunswick (NJ), Somerset County (NJ), Woodbridge (NJ), Swatara Twp. (PA), the United States Secret Service-Uniformed Division, and the U.S. Postal Inspection Service-Washington Division. Additional assistance was provided by multiple U.S. Attorney’s Offices including: the District of New Jersey, Eastern District of Virginia, the District of Maryland, the Central District of California, and the Southern and Middle Districts of Florida. The case is being prosecuted by Assistant U.S. Attorneys Sitara Witanachchi and Andy Wang, of the Violence Reduction and Trafficking Offenses Section in the U.S. Attorney’s Office for the District of Columbia. An indictment is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.


title: El Salvadoran National Pleads Guilty To Illegal Firearm Possession

body_text: MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced that Elian David Vasquez-Lopez, age 23, of El Salvador, entered a guilty plea to Possession of a Firearm and Ammunition by an Illegal Alien. The Indictment alleged that on July 17, 2023, Vasquez-Lopez, knowing he was an illegal alien unlawfully in the United States, unlawfully possessed a firearm and ammunition. During a July 17, 2023, traffic stop, law enforcement discovered Vasquez-Lopez in possession of a 9mm C9 pistol and ammunition. The charges arose from an investigation by the Kiowa Police Department, the Department of Homeland Security, and the Bureau of Alcohol, Tobacco, Firearms and Explosives. The Honorable Gerald L. Jackson, U.S. Magistrate Judge in the United States District Court for the Eastern District of Oklahoma, accepted the plea, and ordered the completion of a presentence investigation report. Vasquez-Lopez was remanded to the custody of the U.S. Marshal pending sentencing. Assistant United States Attorney Richard Lorenz represented the United States.


title: Tahlequah Resident Sentenced For Failing To Register As A Sex Offender

component: USAO - Oklahoma, Eastern

body_text: MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced that Steven Wayne Edwards Jr., age 49, of Tahlequah, Oklahoma, was sentenced to 35 months in prison for knowingly failing to register and update his registration as required by the Sex Offender Registration and Notification Act (SORNA). On June 21, 2022, Edwards pleaded guilty to Failure to Register as a Sex Offender, a violation of SORNA. On March 15, 2022, law enforcement apprehended Edwards for failure to register as a sex offender based on a community tip. Upon his arrest, Edwards admitted that he knew his mandated registration requirements but had nevertheless failed to register upon relocating from Wyoming to Tahlequah in July of 2021. The charges arose from investigations by the U.S. Marshals Service and the Cherokee County Sheriff’s Office. In 2011, Edwards received a felony conviction from the State of Wyoming for Third Degree Sexual Abuse of a Minor. Based on this conviction, Edwards is a Tier III offender with a lifetime reporting requirement: he must appear in person to register in every jurisdiction where he lives, works, or goes to school, and he must appear in person to verify and update registration information every 3 months for life. The Honorable Ronald A. White, Chief Judge in the United States District Court for the Eastern District of Oklahoma, presided over the hearing in Muskogee. Edwards will remain in custody of the U.S. Marshal pending transportation to a designated Federal Bureau of Prisons facility, where he will serve his non-paroleable sentence of incarceration. Special Assistant United States Attorney Genevieve A. Ozark represented the United States.


title: Chicago Felon Sentenced to Over Two Years in Prison for Possessing a Gun

component: USAO - Iowa, Northern

body_text: A Chicago man who fired a gun into the air was sentenced August 29, 2023, to more than two years in federal prison. Ivan Jerome Berry, age 39, from Chicago, Illinois, received the prison term after an April 14, 2023 guilty plea to possession of a firearm by a felon. Evidence at the plea hearing and sentencing hearing showed that in October 2022, Berry fired a gun into the air approximately four times. This occurred at night near an apartment complex. There were people in the area at the time who heard the shots. There were no injuries or damage reports. Berry is a felon and is prohibited from possessing firearms. He has nine prior adult criminal convictions. Berry was sentenced in Cedar Rapids by United States District Court Chief Judge Leonard T. Strand. Berry was sentenced to 27 months’ imprisonment. He must also serve a two-year term of supervised release after the prison term. There is no parole in the federal system. This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results. The case was prosecuted by Assistant United States Attorneys Liz Dupuich and Ashley Corkery and investigated by the Dubuque Police Department and the Bureau of Alcohol, Tobacco, Explosives and Firearms. Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl . The case file number is 23-CR-1004-LTS. Follow us on Twitter @USAO_NDIA.


title: Drug Dealer Who Received Methamphetamine by Mail Sentenced to Two Decades in Federal Prison

body_text: A man on supervised release from a prior drug conspiracy conviction involving methamphetamine was sentenced on August 29, 2023, to 20 years in federal prison for participating in another drug conspiracy. Justin Lee Hanawalt, age 34, from Mason City, Iowa, received the prison term after a February 9, 2023 guilty plea to one count of conspiracy to distribute a controlled substance after having previously been convicted of a serious drug felony. Evidence at the sentencing hearing showed that Hanawalt had packages sent to his residence in Waterloo, Iowa, containing “ice” methamphetamine from his source of supply in California. After he was caught, Hanawalt continued to find alternative suppliers to provide him with controlled substances. Hanawalt was on federal supervised release for a previous methamphetamine related conviction during this time. While in custody for this offense, Hanawalt smuggled controlled substances into the jail and distributed those substances to other inmates. Hanawalt was sentenced in Cedar Rapids by United States District Court Judge C.J. Williams. Hanawalt was sentenced to 240 months’ imprisonment. He must also serve a ten-year term of supervised release after the prison term. He was also sentenced to a consecutive term of 33 months’ imprisonment for violating the conditions of his supervised release for his prior federal conviction. There is no parole in the federal system. Hanawalt is being held in the United States Marshal’s custody until he can be transported to a federal prison. The case was prosecuted by Special Assistant United States Attorney Nicole L. Nagin, and it was investigated by the United States Postal Inspection Service, the Waterloo Police Department, the Black Hawk County Sherriff’s Office and the Tri-County Drug Task Force. Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl . The case file number is 22-CR- 2065. Follow us on Twitter @USAO_NDIA.


title: Chicago Man Sentenced for Cocaine and Heroin Distribution

body_text: A man who distributed cocaine and heroin near Loras College in Dubuque, Iowa, in 2017 and 2018 was sentenced August 29, 2023, to seven years in federal prison. Malcolm Thornton, age 33, from Chicago, Illinois, received the prison term after a January 23, 2023 guilty plea to one count of possession with the intent to distribute cocaine. In a plea agreement, Thornton admitted he was involved in selling cocaine and heroin out of a house near Loras College during 2017 and 2018. Ultimately, Thornton and others were traveling back to Dubuque from Chicago on January 23, 2018, with over 300 grams of cocaine when they were stopped by members of the Dubuque Drug Task Force. Thornton was sentenced in Cedar Rapids by United States District Court Judge C.J. Williams. Thornton was sentenced to 84 months’ imprisonment and must also serve a six-year term of supervised release after the prison term. There is no parole in the federal system. Thornton is being held in the United States Marshal’s custody until he can be transported to a federal prison. The case was prosecuted by Assistant United States Attorney Patrick Reinert and was investigated as part of the Organized Crime Drug Enforcement Task Force (OCDETF) program of the United States Department of Justice through a cooperative effort of Federal Bureau of Investigation, the Bureau of Alcohol Tobacco, Firearms and Explosives, and the Dubuque Drug Task Force comprised of the Dubuque County Sheriff’s Office and the Dubuque Police Department. Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl . The case file number is 22-CR-01021. Follow us on Twitter @USAO_NDIA.


title: Kennewick Business Owner Agrees to Pay $107,534 to Resolve False Claims Act Liability in Connection with COVID Relief Fraud

component: USAO - Washington, Eastern

body_text: Richland, WA – A Kennewick business owner has agreed to pay $107,534 to resolve False Claims Act claims that he misused COVID-19 relief funding to purchase a personal recreational vehicle, announced Vanessa R. Waldref, the United States Attorney for the Eastern District of Washington. This civil settlement is the most recent result announced by the Eastern Washington COVID-19 Fraud Strike Force launched by the U.S. Attorney’s Office last year. On March 27, 2020, the President signed into law the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The CARES Act provided a number of programs through which eligible small businesses could request and obtain relief funding intended to mitigate the economic impacts of the pandemic for small and local businesses. One such program, the Paycheck Protection Program (PPP), provided forgivable loans to eligible small businesses to retain jobs and maintain payroll during the pandemic. Another program, the Economic Injury Disaster Loan (EIDL) program, provided low-interest bridge funding to support businesses endangered by the pandemic. Since being launched in March 2022, the Eastern Washington COVID Strike Force has charged approximately 20 individuals, obtained ten criminal felony fraud convictions, and recovered millions of dollars in misspent funds, fines, and penalties. “COVID-19 relief programs quickly ran out of money due to the number of businesses that requested funding, meaning that struggling, deserving small businesses were not able to obtain critically needed funding to keep their businesses afloat during the shutdowns and disruptions caused by the COVID pandemic,” said U.S. Attorney Waldref. “We created the Eastern Washington COVID-19 Fraud Strike Force because it is critical to the strength and safety of our communities that we all work together to combat pandemic-related fraud and bring much-needed accountability to these programs. The Strike Force works to ensure that limited resources are used to protect our local small businesses and the critical jobs and services that they provide for the community.” In the settlement announced today, Benjamin D. Castilla, the owner of Columbia Basin Netwerks, a Kennewick-based IT services business, admitted that he received PPP and EIDL funding for his business. Castilla admitted that, while he used some of the funding he received for legitimate business purposes, he also used $107,534 to purchase a recreational vehicle (RV) for his personal use. In addition to paying $107,534, Castilla agreed through the settlement to timely repay all of the CARES Act loan funding that he received. “I’d like to recognize the stellar investigative work done by the Small Business Administration, Office of Inspector General, on this case,” continued U.S. Attorney Waldref. “We will continue to work closely with the Strike Force and with our law enforcement partners to protect our communities and bring accountability for those who take advantage of vital public programs.” “Those who misuse SBA pandemic funds for personal gain will be held accountable,” said Special Agent in Charge Weston King of SBA’s OIG Western Region. “I want to thank the U.S. Attorney’s Office and our law enforcement partners for their support and dedication to pursuing justice in this case.” The cases were investigated by the Eastern Washington COVID Fraud Strike Force, and in particular by the Small Business Administration OIG, Western Region. Assistant United States Attorneys Dan Fruchter and Tyler H.L. Tornabene prosecuted this case on behalf of the United States.


title: Veterans Charity CEO and Attorney Charged with $1.9M Fraud Conspiracy

component: Federal Bureau of Investigation (FBI)

body_text: BIRMINGHAM, Ala. – A father and daughter have been charged with devising a scheme to misuse CARES Act funds, announced U.S. Attorney Prim F. Escalona and Federal Bureau of Investigation Special Agent in Charge Carlton L. Peeples. An information filed yesterday in United States District Court charges Kenneth L. Phillips, 62 , of Birmingham, and Danielle A. Phillips , 30 , of Birmingham, with conspiracy to commit wire fraud. According to the information, Kenneth Phillips, a retired Lieutenant Colonel in the U.S. Army, was the founder and CEO of Priority Soldier, Inc. (PSI). His daughter, attorney Danielle Phillips, held various roles with PSI including Chief Operating Officer and in-house legal counsel. PSI's stated mission is to strengthen military families by advocating, educating, and addressing critical issues affecting veterans and their families. The information alleges that in November 2020, the defendants submitted a fraudulent proposal to the State of Alabama requesting COVID-19 grant funding to operate an online program to assist veterans dealing with PTSD in coping with the then-ongoing COVID-19 pandemic. The defendants received approximately $1.9 million dollars in funding, but rather than use the funds for their intended purpose, began transferring funds to their personal bank accounts. After paying themselves a combined salary of more than $400,000 during the one month the program operated, the defendants in January 2021 represented to the Alabama Department of Finance that PSI had spent all but $54,617.04, which they returned. In reality, more than $1.4 million remined in the PSI bank account, which the defendants used to purchase personal items such as luxury sports cars, watches, and diamond jewelry for their own personal benefit. In conjunction with the charge, the government also filed a plea agreement with both Kenneth and Danielle Phillips. Both must appear before a judge to enter a guilty plea. The maximum penalty for conspiracy is five years in prison. The FBI investigated the case. Assistant United States Attorney Ryan S. Rummage is prosecuting the case. An information contains only charges. A defendant is presumed innocent unless and until proven guilty.


title: Another Person Charged with Fraud Involving the Jefferson County Community Service Fund

body_text: BIRMINGHAM, Ala. – An assistant to Representative John Rogers has been indicted by a federal grand jury in connection with schemes to defraud the Jefferson County Community Service Fund, announced U.S. Attorney Prim F. Escalona, Federal Bureau of Investigation Special Agent in Charge Carlton L. Peeples, and Internal Revenue Service, Criminal Investigation Acting Special Agent in Charge Demetrius Hardeman. A 21-count indictment filed this week in United States District Court charges Varrie Johnson Kindall , 58, of Chelsea, with one count of conspiracy to commit wire and mail fraud, 14 counts of wire fraud, 3 counts of mail fraud, 1 count of money laundering, and 2 counts of obstruction of justice. These charges arise from an investigation of wrongdoing in connection with the Jefferson County Community Service Fund. In June, former Representative Fred L. Plump, Jr., pleaded guilty to conspiring with Kindall and resigned from the Alabama House of Representatives. According to the indictment, in 2015 the Alabama Legislature passed Alabama Act No. 2015-226 (the “Act”) and authorized the Jefferson County Commission to levy and distribute a one percent sales tax and a one percent use tax to benefit the public welfare and enhance the education of the children of Jefferson County. Jefferson County began levying the new taxes in or about August 2017. The Act required the County to distribute the tax revenue according to certain specified priorities, including paying debt incurred during school construction, increasing the County’s general fund, giving funds to each board of education serving students in the County, and for certain other purposes set forth in the Act. The Act created the Jefferson County Community Service Fund (the “Fund”), which was subsidized by approximately $3.6 million annually from the new taxes. The Act also created the Jefferson County Community Service Committee (the “Committee”), the four members of which were elected by members of the Jefferson County House and Senate delegations. The Committee was responsible for ensuring that the Fund was used only for the purposes set forth in the Act, which included to support public entities and projects such as schools, libraries, museums, parks, zoos, neighborhood associations, athletic facilities, youth sports associations, road construction, the performing arts, police departments, the sheriff’s office, fire departments, and certain nonprofit entities. Each Representative and Senator representing Jefferson County could make recommendations to the Committee of expenditures from their allotted amount of the Fund. These recommendations were made on a form created by the Committee that required certain certifications by the legislator. The organization receiving the funds was required to submit information about the organization and confirm that it intended to use the money for a public purpose. During each fiscal year from 2018 to 2022, each Representative was allocated approximately $100,000 and each Senator was allocated approximately $240,000 from the Fund. The indictment identifies certain relevant parties. Representative John Rogers was a long-serving member of the Alabama House of Representatives. Fred L. Plump, Jr. served as the Executive Director of the Piper Davis Youth Baseball League (“Piper Davis”), a nonprofit organization that claimed to provide a positive sporting experience for inner city youth in Jefferson County. Defendant Varrie Johnson Kindall was Rogers’ personal and professional assistant. Individual #1 was the Founder of Organization #1. Between fiscal year 2018 and fiscal year 2022, Representative Rogers was allocated approximately $500,000 by the Fund. Rogers directed approximately $400,000 of those discretionary funds to Piper Davis. In turn, Plump gave approximately $200,000 to defendant Kindall. The indictment alleges that from in or about March 2019, and continuing through April 2023, Kindall conspired with Plump and others to defraud and obtain money from the Fund. It is alleged that it was part of the conspiracy that Rogers, with Kindall’s assistance, recommended during each fiscal year that most of his allotment of Fund money be paid to Piper Davis. In turn, Plump agreed to pay kickbacks to Kindall. Plump and Kindall submitted false and fraudulent information to the Committee about Piper Davis’ intended use of Fund money. Upon receipt and deposit of Fund checks, Plump gave checks to Kindall for approximately one-half of the amount of Fund money received by Piper Davis. On two occasions Kindall engaged in money laundering by moving large sums of illegally obtained money between bank accounts. Additionally, the indictment alleges that, in 2019, Kindall committed wire fraud by assisting Rogers in directing Fund money to Organization #1 and then requiring Individual #1 to pay kickbacks to her. The indictment alleges further that, after learning about the federal investigation into the fraud scheme, Kindall attempted to obstruct justice by asking Individual #1 to give false information to federal agents and offering Individual #1 additional grant money as a bribe. The maximum penalty for the conspiracy and substantive fraud counts is twenty years in prison and a $250,000 fine. The maximum penalty for money laundering is ten years in prison and a $250,000 fine. The maximum penalty for obstruction of justice is twenty years in prison and a $250,000 fine. The maximum penalty for obstruction of justice by bribery is five years in prison and a $250,000 fine. The Federal Bureau of Investigation and Internal Revenue Service Criminal Investigation investigated the case. Assistant United States Attorneys George Martin and Catherine Crosby are prosecuting the case. An indictment contains only charges. A defendant is presumed innocent unless and until proven guilty.


title: PRC Citizen Sentenced to 90 Days Prison for Conspiracy to Unlawfully Produce Driver’s Licenses

body_text: Saipan, CNMI – SHAWN N. ANDERSON, United States Attorney for the Districts of Guam and the Northern Mariana Islands (NMI), announced that the United States District Court for the NMI imposed 90 days of imprisonment for Jiang Feng Li, age 31, a citizen of the People’s Republic of China (PRC), for Conspiracy to Unlawfully Produce an Identification Document, in violation of 18 U.S.C. § 1028(a)(1). The Court also ordered Li to serve two years of supervised release and pay a $100 special assessment fee. He was further ordered to report for deportation proceedings. Li became a target of a federal investigation in the Commonwealth of Northern Mariana Islands (CNMI) during the spring of 2021. Investigators in Saipan learned Li was a street broker of driver’s licenses unlawfully produced for foreign citizens who did not have valid immigration status – a requirement for obtaining a license in that jurisdiction. Foreign citizens paid Li $1,400 to $1,600 to have conspirators fraudulently produce licenses by the CNMI Bureau of Motor Vehicles. Li’s federal charge alleged his unlawful assistance to three foreign citizens between May and June 2021. Li initially came to the CNMI as a tourist, which limited his ability to travel to other parts of the United States. In July of 2022, Li traveled via boat from Saipan to Guam. He was eventually located and arrested there in January 2023. “The public deserves to have confidence in the integrity of our licensing systems,” stated United States Attorney Anderson. “Testing drivers for their knowledge and proficiency helps keep our roadways safe. The defendant’s conduct not only induced the unlawful production of licenses for foreign nationals, but potentially contributed to hazards for other drivers. This matter, and related cases, demonstrate our ongoing efforts to promote public safety throughout the CNMI and Guam.” This case was investigated by Federal Bureau of Investigation and prosecuted by Albert Flores Jr., Assistant United States Attorney in the District of the Northern Mariana Islands.


title: Methamphetamine Dealer Sentenced to 64 Months in Federal Prison

component: Drug Enforcement Administration (DEA)

body_text: Saipan, CNMI – SHAWN N. ANDERSON, United States Attorney for the Districts of Guam and the Northern Mariana Islands, announced that Yuzhu Zhang, age 50, a citizen of the People’s Republic of China, was sentenced in the United States District Court for the Northern Mariana Islands to 64 months imprisonment for Possession with Intent to Distribute a Controlled Substance (Methamphetamine), in violation of 21 U.S.C. § 841(a)(1). The Court also ordered three years of supervised release, forfeiture of $4,239 in currency, 100 hours of community service, and a $100 mandatory assessment fee. The defendant was also ordered to report to a U.S. Immigration Officer for deportation proceedings as a condition of supervised release. In March 2022, Customs officers for the Commonwealth of the Northern Mariana Islands (CNMI) discovered more than two kilograms of methamphetamine inside a parcel at the United States Post Office in Saipan. The package had been mailed from California. After removing the drugs, officers performed a controlled delivery of the package to a private mail carrier. Zhang claimed the item from the carrier and was arrested after placing it inside the trunk of his vehicle. Officers also located 19 baggies of methamphetamine, weighing a total of 20.16 grams, and $4,239 in currency inside the vehicle. The drugs had a street value of more than one million dollars. Zhang previously entered the CNMI as a tourist but overstayed the visitation period allowed by federal law. “Drug interdictions by CNMI and federal authorities continue to result in substantial seizures of methamphetamine from our mail system,” stated United States Attorney Anderson. “Traffickers will face substantial penalties, including the forfeiture of any drug proceeds. Foreign nationals will also risk removal from the United States and denial of reentry.” This investigation was led by the CNMI Division of Customs and Quarantine, with assistance from the Drug Enforcement Administration Los Angeles Field Division, Guam Resident Office, Saipan Post of Duty. This case was prosecuted by Albert S. Flores Jr. and Ashley L. Kost, Assistant United States Attorneys in the District of the Northern Mariana Islands.


title: Luzerne County Man Pleads Guilty To Fentanyl Trafficking

component: USAO - Pennsylvania, Middle

body_text: SCRANTON - The United States Attorney’s Office for the Middle District of Pennsylvania announced today that Lee Crawford, age 61, of Wilkes-Barre, Pennsylvania, pleaded guilty on August 28, 2023, before U.S. District Court Judge Malachy E. Mannion, to the charge of conspiracy to distribute more than 40 grams of fentanyl and the charge of possession with intent to distribute fentanyl. According to United States Attorney Gerard M. Karam, Crawford admitted to conspiring with a co-defendant, John Williams, age 43, of Kingston, and with others, to distribute more than 40 grams of fentanyl in the Luzerne County area between July 2020 and February 2021. Investigators made several purchases of fentanyl from Crawford and then obtained a search warrant for Crawford’s residence in Wilkes-Barre, where an additional amount of fentanyl was seized. Crawford also admitted to a separate charge of possession with intent to distribute fentanyl resulting from the search of his residence. Williams previously pleaded guilty to the charge of conspiracy to distribute more than 40 grams of fentanyl and is awaiting sentencing. The charges against the defendants resulted from an investigation conducted by the Kingston Police Department, the Bureau of Alcohol Tobacco and Firearms, and the Luzerne County Drug Task Force. Assistant United States Attorney Robert J. O’Hara is prosecuting the case. This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results. This case was also brought as part of a district wide initiative to combat the nationwide epidemic regarding the use and distribution of heroin and fentanyl. Led by the United States Attorney’s Office, the Heroin Initiative targets heroin and fentanyl traffickers operating in the Middle District of Pennsylvania and is part of a coordinated effort among federal, state, and local law enforcement agencies to locate, apprehend, and prosecute individuals who commit heroin and fentanyl related offenses. Under federal law, Crawford faces a mandatory minimum sentence of ten years in prison, up to a maximum sentence of life in prison, a term of supervised release following imprisonment, and a fine. A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines. ###


title: United States Attorney Erek L. Barron Announces that the Maryland United States Attorney’s Office Continues the Fight Against Fraud, Waste and Abuse Related to the COVID-19 Pandemic

component: USAO - Maryland

body_text: Baltimore , Maryland – Erek L. Barron, the United States Attorney for Maryland, announced that the U.S. Attorney’s Office continues to prioritize the investigation and prosecution of fraud, waste and abuse relating to pandemic relief enacted by Congress, including fraud involving the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act. The CARES Act was designed to provide emergency financial assistance to Americans suffering the economic effects caused by the COVID-19 pandemic. Attorney General Merrick B. Garland previously selected the Maryland U.S. Attorney’s Office to help lead the U.S. Justice Department’s response to COVID-19 fraud, along with U.S. Attorney’s Offices in California and Miami, Florida. On August 23, 2023, the Justice Department announced the results of a coordinated, nationwide enforcement action to combat COVID-19 fraud, including federal criminal charges filed against 371 defendants for offenses related to over $836 million in alleged COVID-19 fraud. Deputy Attorney General Lisa Monaco also announced the formation of additional Strike Forces in the New Jersey and Colorado U.S. Attorney’s Offices. “Maryland’s Strike Force has proven through dedicated resources, partnerships with local, state and federal law enforcement, that those who would steal from American taxpayers are held accountable and our efforts to investigate and prosecute is making a demonstrated difference,” said U.S. Attorney Erek L. Barron. “We cannot, and will not, tolerate those who would take advantage of a global pandemic by stealing funds and defrauding programs intended to help Americans who were suffering during the pandemic.” Led by senior Assistant United States Attorneys Harry Gruber and Paul Riley as well as specially assigned Fraud and Public Corruption Assistant U.S. Attorneys and support staff, the Maryland Strike Force is one of three Strike Force Teams established throughout the United States by the U.S. Department of Justice to investigate and prosecute COVID-19 fraud, including fraud relating to the CARES Act. The Strike Forces focus on large-scale, multi-state pandemic relief fraud perpetrated by criminal organizations and transnational actors. The Strike Forces are interagency law enforcement efforts, using prosecutor-led and data analyst-driven teams designed to identify and bring to justice those who stole pandemic relief funds. Since establishing the Maryland COVID-19 Fraud Strike Force in August 2022, the number of pandemic fraud-related criminal investigations and prosecutions has significantly increased. More than 20 defendants have been charged for various offenses with an alleged loss of approximately $40 million. In addition, there are numerous ongoing criminal COVID-19 fraud investigations. Some of our ongoing COVID-19 fraud investigations involve other criminal activity, including those by repeat violent offenders. The Office’s civil enforcement is also quite active, with 19 active civil fraud cases pending with a total of 19 defendants and approximately $30 million in potential loss. As further commitment to fight pandemic fraud, waste and abuse, the Maryland U.S. Attorney’s Office has also established partnerships with Special Inspector for Pandemic Recovery (SIGPR) General Brian D. Miller. The collaboration with SIGPR allows the U.S. Attorney’s Office and SIGPR to enhance their efforts to combat CARES Act funding fraud, waste and abuse with an emphasis on swift accountability for large-scale and organized fraud schemes. The Maryland U.S. Attorney’s Office has also partnered with the U.S. Department of Labor, Office of Inspector General (DOL-OIG), Office of Investigations. The DOL-OIG partnership includes four DOL-OIG Special Agents working on location in the Maryland U.S. Attorney’s Office, allowing for a quicker response and more comprehensive and coordinated investigations involving CARES Act fraud, waste and abuse and the ability to specifically target suspects of violent crime who are illegally exploiting the CARES Act and other pandemic related programs. As highlighted below, the Maryland U.S. Attorney’s Office’s efforts to combat COVID-19 related fraud, waste and abuse including schemes targeting the Paycheck Protection Program (“PPP”), Economic Injury Disaster Loan (“EIDL”) program and Unemployment Insurance (“UI”) programs have led to significant results. Paycheck Protection Program and Economic Injury Disaster Loans Fraud The PPP and EIDL fraud cases charged federally in Maryland since passage of the CARES Act involve a range of conduct, including many individuals who used shell business entities to fraudulently apply on multiple occasions for benefit funds that they used their personal benefit, such as the purchase of houses, cars, jewelry, high-end electronics and other luxury goods. Some conduct also involves legitimate business owners who inflated their payroll expenses to obtain larger loans than they otherwise would have qualified for, and/or used funds for improper purposes. For example, in U.S. v. Keon Ball , defendant Ball was sentenced to more than five years in federal prison for a wire fraud conspiracy and aggravated identity theft in relation to multiple identity theft schemes and fraud schemes—including schemes conducted while on probation for a past state fraud conviction and while on pre-trial release in connection with state fraud charges. Specifically, in June and July 2020, defendant Ball submitted fraudulent PPP loan applications and obtained $256,664 in government-backed PPP funds for purported businesses that did not exist in any legitimate capacity. Included with each application were fraudulent documents, including fabricated Internal Revenue Service forms, that contained false information concerning purported wages paid and purported number of employees of each business. In total, defendant Ball caused a loss of $750,000 and intended losses of over $1,450,000 and used the identifying information of more than 10 victims in connection with his schemes. In addition to his prison sentence, defendant Ball was ordered to pay at least $715,504 in restitution. Unemployment Insurance Fraud The CARES Act also expanded states’ ability to provide UI benefits for many workers impacted by the COVID-19 pandemic, including for workers who are not ordinarily eligible for unemployment benefits. Many of the defendants charged in Maryland used the personal identifying information (“PII”) of individuals without their knowledge or permission to fraudulently obtain identity documents and obtain UI benefits. In U.S. v. Jerry Phillips , twin brothers and co-defendants Jerry and Jaleel Phillips were sentenced to seven years and 30 months in prison, respectively, and were ordered to pay more than $1 million in restitution, for a wire fraud scheme to fraudulently obtain more than $1 million in PPP and EIDL loans, and UI benefits. Defendant Jerry Phillips also pleaded guilty to aggravated identity theft and possession of a machine gun. The Phillips brothers admitted that they created and used fictitious aliases, used the personal identifying information of real people, and used defunct corporate entities or new business entities with no actual business operations to repeatedly obtain EIDL and PPP loans, and UI benefits. Law enforcement also recovered four “ghost guns” during a search of the Phillips’ residence that defendant Jerry Phillips had purchased online. Defendant Jerry Phillips illegally modified one of the ghost guns into a machine gun. Examples of COVID-19 CARES Act Cases in Maryland The cases in the chart below highlight that many Maryland U.S. Attorney defendants participated in other fraud schemes, including elder fraud and business email compromise schemes. In addition, a number of defendants possessed illegal firearms, including privately manufactured firearms, commonly called “ghost guns.” Case Case number Program Targeted Intended Loss to Taxpayer U.S. v. Reginald Davis ** 23-CR-269 PPP $1,400,000 U.S. v. David Epstein ** 23-CR-210 PPP, EIDL $1,500,000 U.S. v. Denish Sahadevan * 23-CR-191 PPP, EIDL $2,500,000 U.S. v. Tomeka Glenn and Kevin Davis ** 23-CR-027 PPP $305,854 U.S. v. Ryan E. Dales ** 23-CR-026 UI $25,000 U.S. v. Bearden ** 23-CR-023 PPP $734,609 U.S. v. Mikiyas Kefyalew ** 22-CR-382 EIDL $1,600,000 U.S. v. Yannice Nunez, et. al.** 22-CR-342 PPP $674,216 U.S. v. Ayaz Qureshi* 22-CR-330 PPP $250,723 U.S. v. Sherrie Lynne Bryant 22-CR-308 PPP $419,100 U.S. v. Raissa Kaossele et. al. , ** 22-CR-303 EIDL $475,000 U.S. v. Larry Walker * 22-CR-290 PPP $262,252 U.S. v. Tyshawna Davis , et. al., ** 22-CR-248 UI $3,000,000 U.S. v. Alexander Barabash 22-CR-232 PPP $1,317,352 U.S. v. Dana Hayes, Jr. 22-CR-224 PPP, EIDL $50,036 U.S. v. Michael Makoge et. al. , * 22-CR-219 UI $1,600,000 U.S. v. Ahmed Sary** 22-mj-1286 PPP, EIDL $10,000,000 U.S. v. Ron Elfenbein * 22-CR-146 Medicare $15,000,000 U.S. v. Mboutchock Kabiwa * 22-CR-109 EIDL, Medicaid $3,500,000 U.S. v. Jerry Phillips et. al. , 22-CR-073 PPP, EIDL, UI $1,235,213 U.S. v. Nichelle Henson ** 21-CR-470 PPP, EIDL $1,835,340 U.S. v. Oluwaseyi Akinyemi 21-CR-454 UI $486,119 U.S. v. Olaolu Alabi 21-CR-413 UI $1,500,000 U.S. v. Rudolph Elwood Brooks, Jr. * 21-CR-371 PPP $3,500,000 U.S. v. Gladstone Njokem et. al. , 21-CR-338 UI $2,700,000 U.S. v. Brandon Fitzgerald-Holley 21-CR-250 PPP $305,854 U.S. v. Christopher Guy 21-CR-238 UI $176,970 U.S. v. Medard Ulysse 21-CR-054 UI $618,767 U.S. v. Idowu Raji 20-CR-369 UI $1,793,472 U.S. v. Keon Ball et. al. , 20-CR-248 PPP $1,500,000 *Defendant(s) is pending sentencing ** Defendant(s) indicted. 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. Other COVID-19 Related Fraud Schemes Additional COVID-19 related cases brought by the Maryland U.S. Attorney’s Office include shutting down fraudulent websites believed to have been used to collect the personal information of individuals visiting the site; the prosecution of health care fraud related to billing of COVID-19 related treatment or testing; and the prosecution of threats against federal officials involved in COVID-19 pandemic policy. To date, the U.S. Attorney’s Office for the District of Maryland has shut down 17 fraudulent websites which appear to have been used to collect the personal information of individuals visiting the site, in order to use the information for nefarious purposes, including fraud, phishing attacks, and/or deployment of malware. The seized websites were almost identical to the names of authentic U.S. websites, including COVID-19 vaccine manufacturers, retailers, and purported COVID-19 treatment. Several of the seized websites purported to sell vaccines and other treatments for the COVID-19 virus. Often, the fake domains mimicked the stylistic designs and language of the authentic U.S. website. After the seizures, individuals visiting the website see a message that the website has been seized by the federal government and are redirected to another website for additional information. On August 4, 2023, a federal jury convicted medical doctor Ron Elfenbein for five counts of health care fraud related to the submission of false and fraudulent claims to Medicare and other insurers for patients who received COVID-19 tests at sites operated by the defendant. In total, defendant Elfenbein submitted more than $15 million in claims to Medicare and other insurers for patients who received COVID-19 tests at sites operated by defendant Elfenbein. Sentencing is scheduled for November 7, 2023 at 4:00 p.m. On August 4, 2022, Thomas Patrick Connally, Jr. was sentenced to 37 months in federal prison for making threats against a federal official, specifically for sending emails threatening harm the then Director of the National Institute of Allergy and Infectious Diseases at the National Institutes of Health (NIH). Defendant Connally further admitted to threatening the Assistant Secretary for Health at the U.S. Department of Health and Human Services, as well as a Massachusetts public health official and a religious leader. Defendant Connally admitted that he sent the threats with the intent to intimidate or interfere with the performance of these public officials’ duties and with the intent to retaliate against these government officials for performing their official duties, including discussing COVID-19 and its testing and prevention. U.S. Attorney Erek Barron recognized the efforts of a wide range of law enforcement partners for their work in COVID-19 related cases, including the DOL-OIG, the IRS-CI, the FBI, SIGPR, the U.S. Postal Inspection Service, Homeland Security Investigations, the U.S. Secret Service, the Department of Defense Office of Inspector General, Defense Criminal Investigative Service, and the Offices of Inspectors General from SBA, Department of Homeland Security, Social Security Administration, Federal Deposit Insurance Corporation, Department of Health and Human Services, and the Department of Veterans Affairs. For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus . To report a COVID-19-related fraud scheme or suspicious activity, contact the National Center for Disaster Fraud (NCDF) by calling the NCDF Hotline at 1-866-720-5721 or via the NCDF Web Complaint Form at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form . For more information on the Maryland U.S. Attorney’s Office, its priorities, and resources available to fight fraud, please visit www.justice.gov/usao-md and https://www.justice.gov/usao-md/report-fraud . # # #


title: St. Bernard Parish Man Indicted  for Violating Federal Drug  and Firearms Statutes

body_text: NEW ORLEANS, LOUISIANA – TERRY BAHAM, JR. , age 35, a resident of St. Bernard Parish, was charged on August 24, 2023, in a two-count indictment with possession with intent to distribute forty grams or more of a mixture and substance containing a detectable amount of fentanyl, and quantities of mixtures and substances containing detectable amounts of cocaine, methamphetamine, and marijuana, in violation of Title 21, United States Code, Sections 841(a)(1), 841(b)(1)(B), 841(b)(1)(C), and 841(b)(1)(D), as well as possession of firearms in furtherance of a drug trafficking crime, in violation of Title 18, United States Code, Section 924(c)(1)(A), announced U.S. Attorney Duane A. Evans. If convicted of the drug count, BAHAM faces a mandatory minimum term of imprisonment of five years and a maximum term of imprisonment of forty years, a fine of up to $5,000,000.00, and at least four years of supervised release following any term of imprisonment. If convicted of the firearm count, BAHAM faces a mandatory minimum term of imprisonment of five years to run consecutive to any other sentence imposed, a fine of up to $250,000.00, and five years of supervised release following any term of imprisonment. BAHAM also faces payment of a mandatory $100 special assessment fee per count. This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results. U.S. Attorney Evans reiterated that the indictment is merely a charging document and that the guilt of the defendant must be proven beyond a reasonable doubt. This case was investigated by the Drug Enforcement Administration and the St. Bernard Parish Sheriff’s Office. The prosecution is being handled by Assistant United States Attorney André Jones of the Narcotics Unit.


title: Mobile Man Sentenced To 57 Months For Firearm Offenses

component: USAO - Alabama, Southern

body_text: MOBILE, AL -- Cleo Clemons, 41, has been sentenced to 57 months in prison for two counts of being a prohibited person in possession of a firearm. The sentences will run concurrently. Clemons entered a guilty plea to these offenses on April 27, 2023. According to court documents filed in connection with his guilty plea, on January 10, 2021, officers initiated a traffic stop on a black Cadillac Escalade. The vehicle appeared to be racing another vehicle and was traveling at approximately 105 mph in a posted 50 mph zone. The driver and sole occupant of the vehicle was identified as Clemons. Clemons was found to have a felony warrant for his arrest. Inside the vehicle officers located a Taurus 9mm pistol, loaded with 13 rounds of ammunition. Clemons’ DNA was found on the firearm. On July 28, 2022, a warrant was issued with the federal indictment for the January 10 incident. On December 26, 2022, a Mobile Police Department officer was traveling south on Mobile Street approaching Spring Hill Avenue. He observed a black GMC Denali pull out of the gas station in front of him. The officer knew that the driver of that vehicle, Clemons, had felony warrants from FBI for firearm charges. The officer attempted to stop the vehicle, but Clemons did not stop and made several turns down residential streets at high speed. Clemons led officers on a seven-mile chase that reached speeds of up to 80 mph in residential areas before he was taken into custody. Inside the vehicle the officer located a 16-round magazine in the center console and a loaded Smith and Wesson SD9VE semiautomatic pistol wedged between the cover of the sunroof and the sunroof. There was also an extended magazine in the same spot. Clemons had been previously convicted of Possession of a Controlled Substance (Cocaine) and Possession of a Controlled Substance (Cocaine). Chief Judge Jeffrey Beaverstock imposed a 57-month sentence of incarceration and a 3-year term of supervised release upon his discharge from prison. Chief Judge Beaverstock ordered that Clemons pay $200 in special assessments. The Mobile Police Department and Federal Bureau of Investigation (FBI) investigated this case. Assistant United States Attorney Kacey Chappelear prosecuted the case.


title: Amarillo Drug Dealer Charged With Possession of 76 Firearms, 54 Glock Switches

body_text: An Amarillo drug dealer with an arsenal of 76 firearms and 54 Glock switches was indicted on federal drug and gun charges, announced U.S. Attorney for the Northern District of Texas Leigha Simonton. Gabriel Michael Rendon, 28, was charged with possession with intent to distribute cocaine, possession with intent to distribute marijuana, possession of machineguns, possession of firearms in furtherance of a drug trafficking crime, and felon in possession of a firearm. His wife, 26-year-old Jane Marie Burgess, was charged with false statement during the purchase of a firearm. “Glock switches – inch-long devices that convert regular firearms into machineguns capable of a terrifyingly swift rate of fire – are proliferating rapidly in North Texas,” said U.S. Attorney Leigha Simonton. “An armed drug trafficker is always bad news; a drug trafficker armed with a switch is exponentially more dangerous. We cannot and will not allow these devices to take over our streets.” “Citizens of Amarillo can breathe a sigh of relief knowing that Mr. Rendon no longer terrorizes the streets of their city. Illegal firearms and illicit drugs are never a good combination, especially when those guns are possessed by a prohibited person. Together with the United States Attorney’s Office and our law enforcement partners, we will continue to pursue the worst of the worst lawbreakers living amongst us in our communities,” stated ATF Dallas Field Division Special Agent in Charge Jeffrey C. Boshek II. According to the indictment, Mr. Rendon allegedly possessed 76 firearms, including 43 pistols, 23 rifles, four shotguns, and four revolvers, in furtherance of his drug trafficking business. Due to an Arkansas state court conviction for possession of a controlled substance with purpose to deliver, he was legally barred from handling firearms. Mr. Rendon also allegedly possessed at least 54 Glock switches, dangerous devices that convert regular semi-automatic pistols into machineguns capable of continuous fire with a single depression of the trigger. (Glock switches are classified as machineguns under federal law. Unlike semiautomatic firearms, machineguns – weapons that can fire more than one round, without manual reloading, by single function of the trigger – are generally unlawful for non-licensed civilians under the National Firearms Act .) Ms. Burgess allegedly bought guns for her husband, lying on ATF Form 4473 by indicating that she was the actual buyer when she actually intended to hand them over to Mr. Rendon. According to court documents, during a search of Mr. Rendon’s residence on July 26, 2023, Ms. Burgess allegedly told law enforcement that Mr. Rendon was armed at all times when at the home. An indictment is merely an allegation of criminal conduct, not evidence. All defendants are presumed innocent until proven guilty in a court of law. If convicted on all counts, Mr. Rendon faces up to life in federal prison; Ms. Burgess faces up to 10 years in prison. The Bureau of Alcohol, Tobacco, Firearms & Explosives’ Dallas Field Division – Amarillo Resident Agency, the Amarillo Police Department, and the Randall County Sheriff’s Office conducted the investigation. Assistant U.S. Attorney Meredith Pinkham is prosecuting the case.


title: U.S. Attorney Jane E. Young Announces Project Safe Neighborhoods Selection Committee Appointments

component: USAO - New Hampshire

body_text: CONCORD – U.S. Attorney Jane E. Young announces that Bradley J. Russ, Maureen Sullivan, and former Major Joseph M. Ebert have been appointed to serve as the Project Safe Neighborhood’s (PSN) Selection Committee. “These three individuals will serve as the members of an external panel that will review applications for subawards under the PSN Program,” U.S. Attorney Jane E. Young said. “I am thankful for their willingness to contribute their valuable expertise and perspectives to this process.” Bradley J. Russ is the Executive Director of the National Criminal Justice Training Center (NCJTC) of Fox Valley Technical College . He previously served as the Chief of Police of the Portsmouth Police Department and the Commander of the Northern New England Internet Crimes Against Children Task Force. He has over 35 years of experience as a national instructor for U.S. Department of Justice (DOJ) funded training programs, and as a member of national DOJ task forces and commissions. Brad Russ holds a Bachelor of Arts from the University of New Hampshire and is a graduate of the FBI’s National Academy and Law Enforcement Executive Development training programs. Maureen “Moe” Sullivan is the Executive Director of the Child Advocacy Center of Rockingham County (CACRC) . Maureen serves on a variety of committees, including the state advisory committee for the New Hampshire Police Academy and the Rockingham County Chiefs Association (RCCA). She is a former adjunct instructor at the University of New Hampshire’s Peter T. Paul School of Business and Economics, a 2004 graduate of Leadership Seacoast, and former board member of the Portsmouth Rotary Club. She also volunteers with local organizations to include the Rotary District 7780 Opioid Recovery Initiative and Portsmouth Community Coordinated Response to Substance Misuse Disorder. Maureen holds a Doctorate of the Arts in Leadership Studies from Franklin Pierce University, a Master’s in Business Administration from Southern New Hampshire University. Former Major Joseph M. Ebert served in the New Hampshire State Police from 2002-2023. During his time in the State Police, Joe served in a variety of roles to include as: a Trooper assigned to Troop-A; a Field Training Officer; a Drug Recognition Expert; a member of the Crisis Negotiation Team; a Sergeant, Lead Homicide Detective, and Commander in the Major Crime Unit; Director of the New Hampshire Information and Analysis Center; and a Captain in the Investigation Services. In 2022, he was promoted to Major and Commander of the Investigative Services Unit (ISB). As the Commander of the ISB, Major Ebert oversaw the Narcotics Investigations Unit, the Major Crime Unit, the Polygraph Unit, the Special Investigations Unit and the Terrorism and Intelligence Unit. During his tenor as Major, he also acted as, among other roles, a legislative liaison and grant overseer. Joe earned his Master of Science degree in Industrial/Organizational Psychology from Springfield College in 2001. PSN is a nationwide initiative that brings together federal, state, local, tribal, and territorial law enforcement officials, prosecutors, community-based partners, and other stakeholders to identify the most pressing violent crime problems in a community and develop comprehensive solutions to address them. PSN is coordinated by the U.S. Attorneys’ Offices in the 94 federal judicial districts throughout the 50 states and U.S. territories. ###


title: Baltimore Defendant Pleads Guilty to a Conspiracy to Distribute Large Amounts of Fentanyl

body_text: Baltimore , Maryland – Dennis Drake, age 26, of Baltimore, Maryland, pleaded guilty yesterday to his role in a conspiracy to distribute fentanyl and heroin in Baltimore. The guilty plea was announced by United States Attorney for the District of Maryland Erek L. Barron; Special Agent in Charge Jarod Forget of the Drug Enforcement Administration - Washington Field Division; Baltimore City Sheriff Sam Cogen; Acting Commissioner Richard Worley of the Baltimore Police Department; and Chief Robert McCullough of the Baltimore County Police Department. According to his guilty plea, from October 2020 through March 1, 2021, Drake was engaged in a drug trafficking conspiracy involving large amounts of fentanyl and heroin. Drake and his co-conspirators operated a stash house in Pikesville, Maryland, where they processed fentanyl and other drugs, mixed the drugs with cutting agents, and packaged the drugs for re-sale. Drake’s associates drove the packaged drug products to drug shops operated by their drug trafficking organization, including specifically drug shops along Stricker, School and Gilmor Streets in Baltimore. On March 1, 2021, law enforcement executed a search warrant at the stash house in Pikesville and recovered 6.8 kilograms of fentanyl, along with cutting agents and other drug-related paraphernalia. Drake admitted that more than 400 grams, but less than 1.2 kilograms of fentanyl was reasonably foreseeable to him and handled in furtherance of the conspiracy. Five co-conspirators previously pleaded guilty to their roles in the conspiracy and were sentenced to between 21 months and 10 years in federal prison. U.S. District Judge George L. Russell, III has scheduled sentencing for Drake on November 27, 2023, at 9:30 a.m. This case is part of Project Safe Neighborhoods (“PSN”), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results. This case is also part of an Organized Crime Drug Enforcement Task Force (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks. United States Attorney Erek L. Barron commended the DEA, the Baltimore City Sheriff’s Office, the Baltimore Police Department, and the Baltimore County Police Department for their work in the investigation. Mr. Barron thanked Assistant U.S. Attorneys Jason D. Medinger and Ari Evans, who prosecuted the case. For more information on the Maryland U.S. Attorney’s Office, its priorities, and resources available to help the community, please visit https://www.justice.gov/usao-md/project-safe-neighborhoods-psn and https://www.justice.gov/usao-md/community-outreach . # # #


title: Three Kokomo Men Sentenced to Federal Prison After Heist of Over $200,000 from Armored Truck Aided by Inside Man

body_text: INDIANAPOLIS- Keith Martin, 43, Edwin Sims, 31, and James Alexander, 36, of Kokomo, Indiana, have all been sentenced to federal prison after pleading guilty to a coordinated bank theft of $204,918. Edwin Sims also pled guilty to possession with intent to distribute cocaine. According to court documents, on November 16, 2021, at approximately 2: l7pm, officers with the Kokomo Police Department (KPD) responded to a bank near West Jefferson Street after the armed robbery of a Garda armored truck. Upon arrival, officers spoke to the driver of the armored truck, Keith Martin, who stated that while an employee went into the bank to service the ATM, an armed robber, later determined to be Edwin Sims, entered the back of the Garda truck. Sims approached Martin and took his firearm and cell phone, then stole $204,918 in cash from the armored truck. Sims fled the scene in a red Cadillac driven by co-conspirator, James Alexander. While investigating the robbery, officers received additional video from inside the armored truck for the entire day of November 16 th . At two different stops prior to the robbery, Martin can be seen on his phone, as the same red Cadillac drives past the armored truck. When Sims entered the truck, Martin immediately leaned to the left, making it simple to remove his firearm. Martin handed his cell phone and firearm to Sims, without any coercion. Investigators obtained a search warrant for the cell phone records of Martin and discovered that Martin had made several calls with James Alexander prior to the robbery. On November 30, 2021, FBI agents arrested Alexander on an outstanding warrant for Criminal Recklessness. During an interview with investigators, Alexander stated that after the bank theft, the trio met at a Motel 6 to split the money and give Martin his cell phone back. On December 1, 2021, Martin was arrested while driving a GMC Yukon. FBI agents recovered $32,278 in a shoebox and a Glock 19 inside the vehicle. An additional search of the red Cadillac used in the getaway was also conducted, uncovering $35,387 inside a backpack. On December 8, 2021, officers attempted to arrest Sims in Indianapolis. Sims fled but was taken into custody at East l6th Street and Campbell Avenue. Officers located 17.9 grams of cocaine base and 52 grams of cocaine individually bagged for sale next to Sims at the time of his arrest. Keith Martin was sentenced in July 2023 to seven months in federal prison. Edwin Sims was sentenced in March 2023 to 12.5 years’ imprisonment. James Alexander was sentenced in August 2023 to 27 months’ imprisonment. The three defendants were each ordered to pay $135,792.85 in restitution. “This brazen conspiracy was quickly unraveled by the outstanding investigative efforts of the FBI, Kokomo Police, and DEA,” said U.S. Attorney Zachary A. Myers. “Federal prosecutors and law enforcement agencies will continue to prioritize working with our local partners to address violent crime in our communities. The convictions and sentences in this case demonstrate that that these serious crimes carry serious consequences.” “The FBI is committed to investigating violent crime and pursuing those who commit these offenses which this sentence clearly demonstrates,” said FBI Indianapolis Special Agent in Charge Herbert J. Stapleton. “The rapid response and outstanding investigative work by the FBI, the Kokomo Police Department, and the DEA ensured these three defendants are behind bars where they belong.” The Federal Bureau of Investigations, Kokomo Police Department, and the Drug Enforcement Administration investigated this case. The sentences were imposed by U.S. District Court Judge, James R. Sweeney. Judge Sweeney also ordered that Martin, Sims, and Alexander be supervised by the U.S. Probation Office following their release from federal prison for 2, 3, 3, years respectively. U.S. Attorney Myers thanked Assistant United States Attorney Peter A. Blackett, who prosecuted this case. ###


title: Federal Jury Convicts Zachary Man of Multiple Drug and Gun Charges

component: USAO - Louisiana, Middle

body_text: United States Attorney Ronald C. Gathe, Jr., announced the conviction of Jeremy Dewayne Hawkins, age 43, of Zachary, Louisiana. After a three-day trial before Chief Judge Shelly D. Dick, the jury unanimously convicted Hawkins of conspiracy to distribute and possess with the intent to distribute cocaine and heroin, possession with the intent to distribute cocaine, and possession of firearms and ammunition by a convicted felon. As the evidence at trial demonstrated, DEA agents intercepted communications over four of Hawkins’ telephones between June and August 2017 and learned that Hawkins conspired with others to obtain kilogram quantities of cocaine and heroin from Houston, Texas and elsewhere and redistribute those narcotics within the Middle District of Louisiana. Evidence brough to light at trial by federal and state law enforcement officials described a search warrant on Hawkins’ property in Ethel, Louisiana, where agents located more than four kilograms of cocaine, over 100 grams of heroin, six firearms, and over 800 rounds of ammunition. Hawkins was a convicted felon and prohibited from possessing firearms and ammunition. As a result of his convictions, Hawkins now faces a maximum sentence in federal prison of up to 40 years imprisonment, as well as significant fines, forfeiture, and a minimum 4-year term of supervised release. This effort is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF . This case was investigated by the Drug Enforcement Administration, with the assistance of the Bureau of Alcohol, Tobacco, Firearms, and Explosives, Internal Revenue Service, Iberville Parish Sheriff’s Office, Baton Rouge Police Department, East Baton Rouge Sheriff’s Office, Louisiana State Police, East Feliciana Parish Sheriff’s Office, and Ascension Parish Sheriff’s Office. The case was prosecuted by Assistant United States Attorneys Jessica Jarreau, who also serves as the Deputy Chief of the Organized and Violent Crime Unit, and Jene C. Clayton.


title: Qakbot Malware Disrupted in International Cyber Takedown

component: USAO - California, Central

body_text: LOS ANGELES – The Justice Department today announced a multinational operation involving actions in the United States, France, Germany, the Netherlands, the United Kingdom, Romania, and Latvia to disrupt the botnet and malware known as Qakbot and take down its infrastructure. The Qakbot malicious code is being deleted from victim computers, preventing it from doing any more harm. The Department also announced the seizure of more than $8.6 million in cryptocurrency in illicit profits. The action represents the largest U.S.-led financial and technical disruption of a botnet infrastructure leveraged by cybercriminals to commit ransomware, financial fraud, and other cyber-enabled criminal activity. “Cybercriminals who rely on malware like Qakbot to steal private data from innocent victims have been reminded today that they do not operate outside the bounds of the law,” said Attorney General Merrick B. Garland. “Together with our international partners, the Justice Department has hacked Qakbot’s infrastructure, launched an aggressive campaign to uninstall the malware from victim computers in the United States and around the world, and seized $8.6 million in extorted funds.” “An international partnership led by the Justice Department and the FBI has resulted in the dismantling of Qakbot, one of the most notorious botnets ever, responsible for massive losses to victims around the world,” said United States Attorney Martin Estrada. “Qakbot was the botnet of choice for some of the most infamous ransomware gangs, but we have now taken it out. This operation also has led to the seizure of almost 9 million dollars in cryptocurrency from the Qakbot cybercriminal organization, which will now be made available to victims. My Office’s focus is on protecting and vindicating the rights of victims, and this multifaceted attack on computer-enabled crime demonstrates our commitment to safeguarding our nation from harm.” “The Operation ‘Duck Hunt’ Team utilized their expertise in science and technology, but also relied on their ingenuity and passion to identify and cripple Qakbot, a highly structured and multi-layered bot network that was literally feeding the global cybercrime supply chain,” said Donald Alway, the Assistant Director in Charge of the FBI’s Los Angeles Field Office. “These actions will prevent an untold number of cyberattacks at all levels, from the compromised personal computer to a catastrophic attack on our critical infrastructure." According to court documents, Qakbot, also known by various other names, including “Qbot” and “Pinkslipbot,” is controlled by a cybercriminal organization and used to target critical industries worldwide. The Qakbot malware primarily infects victim computers through spam email messages containing malicious attachments or hyperlinks. Once it has infected a victim computer, Qakbot can deliver additional malware, including ransomware, to the infected computer. Qakbot has been used as an initial means of infection by many prolific ransomware groups in recent years, including Conti, ProLock, Egregor, REvil, MegaCortex, and Black Basta. The ransomware actors then extort their victims, seeking ransom payments in bitcoin before returning access to the victim computer networks. These ransomware groups caused significant harm to businesses, healthcare providers, and government agencies all over the world, including to a power engineering firm based in Illinois; financial services organizations based in Alabama, Kansas, and Maryland; a defense manufacturer based in Maryland; and a food distribution company in Southern California. Investigators have found evidence that, between October 2021 and April 2023, Qakbot administrators received fees corresponding to approximately $58 million in ransoms paid by victims. The victim computers infected with Qakbot malware are part of a botnet (a network of compromised computers), meaning the perpetrators can remotely control all the infected computers in a coordinated manner. The owners and operators of the victim computers are typically unaware of the infection. As part of the takedown, the FBI was able to gain access to Qakbot infrastructure and identify over 700,000 computers worldwide, including more than 200,000 in the United States, that appear to have been infected with Qakbot. To disrupt the botnet, the FBI was able to redirect Qakbot botnet traffic to and through servers controlled by the FBI, which in turn instructed infected computers in the United States and elsewhere to download a file created by law enforcement that would uninstall the Qakbot malware. This uninstaller was designed to untether the victim computer from the Qakbot botnet, preventing further installation of malware through Qakbot. The scope of this law enforcement action was limited to information installed on the victim computers by the Qakbot actors. It did not extend to remediating other malware already installed on the victim computers and did not involve access to or modification of the information of the owners and users of the infected computers. Valuable technical assistance was provided by Zscaler. The FBI has partnered with the Cybersecurity and Infrastructure Security Agency, Shadowserver, Microsoft Digital Crimes Unit, the National Cyber Forensics and Training Alliance, and Have I Been Pwned to aid in victim notification and remediation. The FBI Los Angeles Field Office, the U.S. Attorney’s Office for the Central District of California, and the Criminal Division’s Computer Crime and Intellectual Property Section (CCIPS) conducted the operation in close cooperation with Eurojust. Investigators and prosecutors from several jurisdictions provided crucial assistance, including Europol, French Police Cybercrime Central Bureau and the Cybercrime Section of the Paris Prosecution Office, Germany’s Federal Criminal Police and General Public Prosecutor’s Office Frankfurt/Main, Netherlands National Police and National Public Prosecution Office, the United Kingdom’s National Crime Agency, Romania’s National Police, and Latvia’s State Police. The Justice Department’s Office of International Affairs and the FBI Milwaukee Field Office provided significant assistance. Assistant United States Attorneys Khaldoun Shobaki and Lauren Restrepo of the Cyber and Intellectual Property Crimes Section, along with CCIPS Trial Attorneys Jessica Peck, Ryan K.J. Dickey and Benjamin Proctor. Additional information and resources, including for victims, can be found on the following website, which will be updated as additional information and resources become available: https://www.justice.gov/usao-cdca/divisions/national-security-division/qakbot-resources


title: Massachusetts Commercial Fisherman Pleads Guilty to Tax Evasion

component: Tax Division

body_text: A Massachusetts man pleaded guilty today to evading taxes on income he earned as a commercial fisherman. According to court documents and statements made in court, John Doe of New Bedford, Massachusetts, worked as a commercial fisherman operating primarily out of the Port of New Bedford. Despite receiving approximately $1.9 million in income between 2012 and 2021, Doe did not file tax returns with the IRS and did not pay taxes on the income he earned. To conceal his earnings from the IRS, Doe cashed his paychecks from fishing companies at check-cashing businesses and then used the cash to fund his personal lifestyle. He also used stolen identities to cash the checks. In total, Doe caused a tax loss to the IRS of approximately $520,415. Doe is scheduled to be sentenced on Dec. 1 and faces a maximum statutory penalty of five years in prison. He also faces a period of supervised release, restitution and monetary penalties. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors. Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division made the announcement. IRS-Criminal Investigation is investigating the case. Trial Attorney Ezra Spiro and Assistant Chief John Kane of the Tax Division are prosecuting the case.


title: Former Stockbroker Pleads Guilty to Penny-Stock Securities Fraud Scheme

component: USAO - Massachusetts

body_text: BOSTON – A California man has pleaded guilty in federal court in Boston to his involvement as the principal stock trader in a sophisticated securities fraud scheme that generated tens of millions of dollars in illicit profits. Joseph A. Padilla, 54, of Carlsbad, Calif. and Cabo San Lucas, Mexico, pleaded guilty on Aug. 17, 2023 to one count of conspiracy to commit securities fraud, two counts of securities fraud and one count of attempting to cause the production of an identification document without lawful authority. U.S. District Court Judge Richard G. Stearns scheduled sentencing for Nov. 15, 2023. Padilla was charged in March 2023 along with an alleged co-conspirator. Padilla is a former stockbroker who was barred from the securities industry in 2012 by the U.S. Securities and Exchange Commission (SEC). Between 2020 and 2022, Padilla allegedly conspired with others to commit securities fraud by facilitating and participating in market manipulation schemes involving the concealed-control of the shares of penny-stock companies. Specifically, between October 2020 and July 2022, Padilla participated in a market manipulation scheme involving the shares of Oncology Pharma, Inc., a thinly traded company that traded on the over-the-counter securities market under the ticker symbol ONPH. As part of the scheme, a co-conspirator allegedly caused nearly all of ONPH’s free-trading shares to be transferred to multiple brokerage accounts for the benefit of Padilla’s clients at the Cayman Islands broker Valor Capital, with which Padilla had a close, unofficial association. Padilla then engaged in manipulative trading in ONPH designed, at least in part, to artificially drive up the company’s stock price, after which Padilla began dumping the ONPH shares—which were under common control—to unsuspecting investors in Massachusetts and throughout the United States during a promotional campaign, generating illicit proceeds alleged to be in the tens of millions of dollars. Additionally, between January 2020 and April 2021, Padilla participated in a similar scheme involving the shares of Charlestowne Premium Beverages Inc., a thinly traded company that traded on the over-the-counter market under the ticker symbol FPWM. As part of the scheme, Padilla orchestrated an effort designed, at least in part, to artificially increase Charlestowne’s stock price. He then facilitated the sale of millions of Charlestowne’s shares during a promotional campaign to unsuspecting investors in Massachusetts and throughout the United States, generating illicit proceeds alleged to be in the millions of dollars. Padilla was arrested on a criminal complaint in August 2022 and released on pre-trial conditions, which included surrendering his passport and not obtaining another passport. While on pre-trial release, Padilla attempted to acquire a fraudulent Ukrainian passport so that he could flee prosecution. Padilla was arrested in January 2023 for violating his terms of release and his pre-trial release was revoked. The charge of securities fraud provides for a sentence of up to 20 years in prison, three years of supervised release and a fine of $5 million. The charge of conspiracy to commit securities fraud provides for a sentence of up to five years in prison, three years of supervised release, and a fine of $250,000. The charge of attempt to cause the production of an identification document without lawful authority provides for a sentence of up to five years in prison, three years of supervised release, and a fine of $250,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and statutes which govern the determination of a sentence in a criminal case. Acting United States Attorney Joshua S. Levy and Jodi Cohen, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division made the announcement today. Assistant United States Attorneys James R. Drabick and Ian J. Stearns of the Securities, Financial & Cyber Fraud Unit are prosecuting the case. The details contained in the charging document are allegations. The remaining defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.