Month: April 2022

Source: United States Department of Justice Criminal Division

Two New York residents were sentenced on charges of selling and conspiring to transfer false identification documents on the darknet marketplaces AlphaBay Market and Dream Market. According to court documents, from at least from May 2015 until October 2017, defendants Andrea Alessandrini and Evan Hayes sold New York state driver’s licenses, fraudulent identity information for individuals (including fake social security numbers and birthdates), credit card holograms, and ATM skimmers on the darknet, all in exchange for cryptocurrency.

Yesterday, the U.S. District Court for the Eastern District of California sentenced Evan Hayes, 28, of Buffalo, New York, to 18 months in prison, and on April 5, 2021, Alessandrini, 34, of Italy, was sentenced to 20 months in prison, for their roles in the charged identity fraud conspiracy. Alessandrini and Hayes pleaded guilty to the offenses on Nov. 16, 2020, and July 12, 2021, respectively.

According to court filings and statements made in connection with the defendants’ guilty pleas, Alessandrini created and operated the vendor account PlasticA on numerous darknet marketplaces, including AlphaBay Market and Dream Market. With his business partner, Hayes, Alessandrini sold over 300 fraudulent New York identity cards, four social security cards, 15 false birth certificates, 28 state identity card holograms, one ATM skimmer, and 410 “farmed” (i.e., stolen or fraudulently produced) identity packages to buyers in the Eastern District of California and elsewhere. Alessandrini operated the primary darknet accounts used to make these sales, while Hayes produced and mailed most of the fraudulent documents sold. On AlphaBay alone, Alessandrini and Hayes conducted between $250,000 and $400,000’s worth of transactions between May 2015 and October 2017.

In connection with the case, the United States seized evidence concerning the wide range of fraudulent identity documents created and sold to buyers throughout the United States, evidence which has been shared with a range of law enforcement agencies for use in additional investigations. Finally, the United States forfeited the proceeds of the offense conduct, which included approximately $134,881 in U.S. currency, 14.78 Bitcoins, 285 ounces of silver, four ounces of gold, and 22 prepaid Visa gift cards.

Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division and U.S. Attorney Phillip A. Talbert for the Eastern District of California made the announcement.

The FBI and the U.S. Postal Inspection Service investigated the case.

Senior Counsel Louisa K. Marion of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Paul Hemesath for the Eastern District of California prosecuted the case.

Source: United States Department of Justice News

PROVIDENCE, R.I. – Each April, the Department of Justice and United States Attorney’s Offices across the nation join survivors, advocates, and communities in observing Sexual Assault Awareness and Prevention Month. Sexual assault is far too prevalent, and it is important to not only raise awareness of the myriad forms of it takes, but to engage in meaningful prevention efforts, take action to hold offenders accountable, and care for survivors in a trauma-informed manner.

United States Attorney Zachary A. Cunha joins the Department of Justice and the Office on Violence Against Women (OVW) in applauding the recent passage of the Violence Against Women Reauthorization Act of 2022 (VAWA 2022), which treats sexual assault as the serious violation it is and creates new programs and initiatives that provide survivors of sexual violence with increased access to services and justice.

VAWA 2022 also expands outreach to survivors in underserved communities, including by improving access to sexual assault medical forensic examinations for survivors in rural areas; providing community-specific services for LGBT survivors; and restoring tribes’ jurisdiction to prosecute non-Indian perpetrators of sexual violence and sex trafficking, among certain other offenses committed on tribal lands.

“This year, as we recognize Sexual Assault Awareness and Prevention Month, we honor the victims of sexual assault and its impacts by rededicating ourselves- not just this month, but every month- to doing everything in our power to combat these crimes in our communities, to support sexual assault victims, and to raise awareness,” said U.S. Attorney Cunha.  “It is imperative that victims know that they are not alone, and that the law enforcement community stands with them and will continue to seek justice on their behalf.”

“During Sexual Assault Awareness and Prevention Month, and every month, OVW-funded programs across the nation provide essential services to survivors of sexual assault, responding to their needs, helping them heal, and supporting them as they pursue the justice they seek,” said OVW Principal Deputy Director Allison Randall. “The impact of sexual violence is felt by the entire community and can devastate survivors’ lives, which is why it is critical that VAWA 2022 strengthens not just services and justice interventions but also prevention.” 

Recently awarded funding provides more than $2.7 million in OVW funds to agencies in Rhode Island, to include $575,000 to the Blackstone Valley Advocacy Center; $179,076 to Day One; $98,706 to the Rhode Island Coalition Against Domestic Violence; $1,401,676 to the Rhode Island Department of Public Safety; and $500,000 to Sojourner House. 

OVW provides leadership in developing the nation’s capacity to reduce violence through the implementation of the Violence Against Women Act and subsequent legislation. Created in 1995, OVW administers financial and technical assistance to communities across the country that are developing programs, policies and practices aimed at ending domestic violence, dating violence, sexual assault and stalking. In addition to overseeing federal grant programs, OVW undertakes initiatives in response to special needs identified by communities facing acute challenges. Learn more at www.justice.gov/ovw.

If you or someone you know is experiencing or has experienced sexual violence, you are not alone and there are many services available to help, including the Sexual Assault Hotline, 1-800-656-HOPE (4673). In addition, you can find a local resources page on OVW’s website, which lists state sexual assault coalitions that can direct you to local resources and services, as well as opportunities to get involved.

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Source: United States Department of Justice News

Tampa, Florida – United States Attorney Roger B. Handberg announces that Abdul Aziz has pleaded guilty to one count of aiding in the preparation and filing of a false tax return. He faces a maximum penalty of three years in federal prison. A sentencing date has not yet been set.

According to the plea agreement, Aziz helped to prepare numerous false and fraudulent income tax returns on behalf of clients in 2016. Those tax returns contained false information about clients’ income and their tax withholding status. The false entries in those returns related to residential mortgage loan repayments that the returns falsely represented as being held on their behalf by financial institutions and were claimed as income. As a result of those false entries, Aziz’s clients were able to claim and receive substantial refunds from the IRS which his clients were not lawfully entitled to receive. Those refunds exceeded $1,500,000.

This case was investigated by the Internal Revenue Service – Criminal Investigation. It is being prosecuted by Assistant United States Attorney Jay L. Hoffer.

Source: United States Department of Justice Criminal Division

A North Dakota man, formerly the executive vice president of U.S. operations at a publicly traded Canadian oil-services company, was sentenced yesterday to three years in prison for perpetrating a scheme to fraudulently inflate the company’s reported revenue that resulted in shareholder losses in excess of $886 million. 

According to court documents, Joseph A. Kostelecky, 61, of Dickinson, engaged in a scheme to defraud while serving as the highest-ranking U.S. executive of Poseidon Concepts Corporation (Poseidon) from approximately November 2011 to December 2012. Kostelecky previously pleaded guilty on Oct. 13, 2021, admitting that, in his role, he caused Poseidon to falsely report approximately $100 million in revenue from purported long-term contracts with oil and natural gas companies that were Poseidon’s customers.

Kostelecky’s misconduct included fraudulently directing Poseidon’s accounting staff at the U.S. corporate headquarters in Denver, Colorado, as well as its field office in Dickinson, to record revenue from such contracts and then assuring management that the associated revenue was collectable, when he knew that the contracts either did not exist or that the associated revenue was not collectable. After Poseidon reported a partial write-down of uncollectable accounts in its financial statements, resulting in a drop in the company’s stock price, Kostelecky fraudulently caused the issuance of a public filing falsely reporting that he had purchased a substantial number of shares of the company when, in fact, he had made no such purchase. Kostelecky admitted that when the inflated revenue came to light at the end of 2012, Poseidon’s stock price plunged and the company was forced into bankruptcy, causing over $886 million in shareholder losses. Kostelecky further admitted that he perpetrated the scheme to inflate the value of the company’s stock price in order to enrich himself through the continued receipt of compensation and appreciation of his own stock and stock options.

In addition to the prison sentence, Kostelecky was ordered to pay approximately $406.2 million in restitution. 

Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division and Inspector in Charge Eric Shen of the U.S. Postal Inspection Service’s Criminal Investigations Group made the announcement.

The U.S. Postal Inspection Service Criminal Investigation Group’s DOJ Mail Fraud Team investigated the case.

Assistant Deputy Chief Anna G. Kaminska and Trial Attorney Jason M. Covert of the Criminal Division’s Fraud Section prosecuted the case. The Securities and Exchange Commission and the U.S. Attorney’s Office for the District of North Dakota provided valuable assistance.