Month: May 2022

Source: United States Department of Justice News

TUCSON, Ariz. – Koreasa M. Williams, 49, of Tucson, Arizona, pleaded guilty last week to defrauding an elderly annuity client of more than $1,300,000. Williams, formerly licensed in Arizona to sell life and health insurance, pleaded guilty to two counts of Wire Fraud, each of which carries a maximum penalty of 20 years in prison and a $250,000 fine. Sentencing is scheduled for July 5, 2022, before United States District Judge Jennifer G. Zipps.

Williams admitted she engaged in two separate schemes to defraud her client. In the first scheme, Williams admitted to inducing her client to cash in several life insurance policies in order to invest the proceeds in annuities to be procured by Williams. Williams admitted that over a period of six months in 2019, she fraudulently convinced her client to give her $1,200,000. Instead of investing that money for her client, Williams used almost $900,000 to pay victims of a prior unrelated annuity fraud scheme in an attempt to avoid criminal charges. Williams subsequently pleaded guilty to wire fraud in that unrelated fraud scheme and was sentenced to 51 months in prison in December 2021. Williams used the remaining $300,000 to pay her attorney’s fees for the unrelated fraud scheme and to settle a civil suit brought by another client.

In the second scheme, Williams admitted to inducing her client to dissolve a charitable foundation and place more than $124,000 in an entity controlled by Williams. Williams was to hold the funds until a new entity could be established to receive the money that would then be used to care for her client’s disabled adult daughter. However, Williams never established the new entity and instead diverted more than $118,00 to her own use and benefit.

The FBI, Tucson Resident Agency, conducted the investigation in this case. Assistant U.S. Attorneys Wallace H. Kleindienst and Mary Sue Feldmeier, of the Financial Crimes and Public Corruption section of the U.S. Attorney’s Office, District of Arizona, Tucson, handled the prosecution.

CASE NUMBER:            CR-21-03136-TUC-JGZ
RELEASE NUMBER:    2022-057_Williams

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For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
Follow the U.S. Attorney’s Office, District of Arizona, on Twitter @USAO_AZ for the latest news.

Source: United States Department of Justice News

A man who allegedly built an explosive device that was found in a backpack during a traffic stop was charged in federal court, announced U.S. Attorney Clint Johnson.

Joe Allen Forest, 24, was charged by Criminal Complaint with unlawful manufacture of a destructive device.

On April 28, 2022, a Bixby police officer attempted to stop a speeding driver, who then led the officer on a chase. The driver eventually stopped and was taken into custody.

According to the Complaint, a vehicle inventory was conducted, and the officer observed a backpack on the floorboard with a canister that appeared to be an explosive device. The Oklahoma Highway Patrol Bomb Squad and Bureau of Alcohol, Tobacco, Firearms and Explosives were contacted and arrived on scene. They determined the device to be an expended military smoke grenade which had been manipulated and refilled with explosive powders and disassembled fireworks. The device further had a pyrotechnic fuse along its side then entering the device at the bottom. They also located an intact small triangular explosive device inside the backpack. The triangular devices are often illegally imported into the United States and contain 3 grams of flash powder. All devices were rendered safe.

The driver told investigators that the backpack and devices belonged to Joe Allen Forest and that he had dropped him off earlier. Forest was eventually located and taken into custody. According to the Complaint, agents found four small triangular devices in Forest’s pocket, which were the same as the triangular device found earlier in the backpack. Forest also allegedly told agents that he built the larger device found in the backpack at his home in Bixby nearly a month ago and was planning to blow it up at a creek.

*This matter will proceed in United States District Court in Tulsa, where the Complaint is currently pending. A Complaint is a temporary charge alleging a violation of law. For the case to proceed to trial, the United States must present the charge to a federal Grand Jury within 30 days. Once a Grand Jury returns an Indictment, a defendant has a right to a jury trial at which the United States would have the burden of proving the defendant’s guilt beyond a reasonable doubt. All defendants are presumed innocent until proven guilty in a court of law.

The Bureau of Alcohol, Tobacco, Firearms and Explosives, Oklahoma Highway Patrol, and Bixby Police Department are the investigative agencies. Assistant U.S. Attorney Robert T. Raley is prosecuting the case. AUSA Raley is the National Security Anti-Terrorism (ATAC) Prosecutor for the U.S. Attorney’s Office in the Northern District of Oklahoma.

Source: United States Department of Justice News

PHILADELPHIA – United States Attorney Jennifer Arbittier Williams announced that Arthur Rowland, a/k/a “Bo,” 41, of Philadelphia, PA, was convicted after trial of multiple narcotics offenses, along with his earlier conviction for being a felon-in-possession of a firearm, arising from his participation in a large scale interstate methamphetamine distribution conspiracy.

In December 2018, the defendant was arrested pursuant to an Indictment charging him and four other individuals with conspiracy to distribute methamphetamine and related charges. Ultimately, a second Superseding Indictment charged Rowland and five others with participating in a methamphetamine distribution conspiracy that acquired hundreds of pounds of Mexican methamphetamine in Los Angeles, shipped the illegal narcotics back to the Philadelphia area for distribution here, and in turn transferred many thousands of dollars back to the California-based sellers to pay for that methamphetamine. In addition to the drug conspiracy, Rowland was also charged with possessing with intent to distribute about nine pounds of methamphetamine from packages that he had shipped to multiple Philadelphia-area locations, and with possessing two AK-47 style assault type weapons and a semi-automatic handgun while being a felon, and with using those same weapons in furtherance of his drug trafficking activities.

“Rowland and his co-conspirators shipped tons of drugs from one end of this country to the other through a large and sophisticated trafficking enterprise,” said U.S. Attorney Williams. “Today’s conviction demonstrates our Office’s commitment to taking down these types of criminal organizations and cutting off the supply of deadly drugs in order to keep our communities safe.”

“Arthur Rowland was part of a conspiracy that saw vast amounts of meth brought into and sold in the Philadelphia area,” said Jacqueline Maguire, Special Agent in Charge of the FBI’s Philadelphia Division. “This conviction is a win for the FBI and all of our partners as we work together to get dangerous drugs and criminals off the street. The ultimate goal here is to eliminate the drug trade and concomitant gun violence plaguing so many communities.”

The case was investigated by the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorneys Paul Shapiro and Timothy Stengel.

Source: United States Department of Justice News

Three Northeastern Iowa family members were sentenced recently in federal court for their respective roles in crop loan and bankruptcy fraud schemes.

Aimee Lynn Rosenbaum, formerly known as Aimee Lynn Flatjord, age 53, from Lawler, Iowa, was sentenced to 78 months of imprisonment on April 28, 2022.  She was ordered to make $165,592.21 in restitution to the United States Department of Agriculture-Farm Services Agency (“USDA-FSA”) and $4,796 in restitution to a bank, to pay a $5,000 fine, and to repay $7,086.74 in attorney fees for her prior court-appointed counsel.  She must also serve a three-year term of supervised release after the prison term.  Aimee Lynn Rosenbaum received the prison term after a June 14, 2021 guilty plea to one count of conversion of property pledged to a farm credit agency and one count of bankruptcy fraud.

Donald Eugene Rosenbaum, age 58, from Cresco, Iowa, was sentenced to two years of probation on May 2, 2022.  He was also ordered to pay a $1,000 fine.  Donald Eugene Rosenbaum received the probation term after a June 10, 2021 guilty plea to one count of bankruptcy fraud.

Marshal Dillion Rosenbaum, age 27, from Fredericksburg, Iowa, was sentenced to three months of imprisonment and three months of home confinement on April 25, 2022.  He was also ordered to make $165,592.21 in restitution to the USDA-FSA, jointly and severally with Aimee Lynn Rosenbaum.  Marshal Dillion Rosenbaum received the prison term after a June 21, 2021 guilty plea to one count of conversion of property pledged to a farm credit agency.  He must also serve a three-year term of supervised release after the prison term. 

In the family members’ plea agreements, as well as through evidence at a three-day sentencing hearing for Aimee Lynn Rosenbaum, it was established that Aimee Lynn Rosenbaum (“Aimee”) and Donald Eugene Rosenbaum (“Donald”) historically farmed land in Chickasaw County, Iowa.  Marshal Dillion Rosenbaum (“Marshal”) is the son of Aimee and Donald.  In late 2014, Aimee directed Marshal to apply for a crop loan with the USDA-FSA for the 2015 crop year on the pretense that Marshal would be taking over the farm due to purported health problems of Aimee and Donald.  After Marshal obtained over $165,000 in loan proceeds and pledged the farm’s 2015 crop to the USDA-FSA, Aimee applied for and obtained over $1.3 million in loans from a local bank on the representation that Aimee and Donald would continue to farm the land that year.  The 2015 crop thus was double-pledged without the knowledge of the USDA or the bank.  Aimee applied for the bank loans on Donald’s behalf using a power of attorney she had obtained from Donald.

The Rosenbaums eventually defaulted on both loans and sold the double-pledged crop with little to no repayment.  After the bank started foreclosure proceedings on the Rosenbaums’ farm, Aimee and Donald filed five bankruptcy petitions in the United States Bankruptcy Court for the Northern District of Iowa. Aimee and Donald each filed two additional bankruptcy petitions in bad faith and on the eve of scheduled Sheriff’s sales in state court in order to frustrate and delay the bank’s attempts to obtain repayment for its loans to Aimee and Donald.  During one telephonic hearing in bankruptcy court in 2019, Aimee pretended to be Donald.  The district court also found that Aimee submitted false evidence and testimony to the district court at her sentencing hearing.

The Rosenbaums were sentenced in Cedar Rapids by United States District Court Judge C.J. Williams.  Aimee Lynn Rosenbaum and Marshal Dillion Rosenbaum were released on bonds previously set and are to surrender to the Bureau of Prisons on dates yet to be set.

The case was prosecuted by Assistant United States Attorney Timothy L. Vavricek and investigated by the United States Department of Agriculture, Office of Inspector General, and the Federal Bureau of Investigation. 

Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. 

The case file number is 19-CR-2078.

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Source: United States Department of Justice News

Tampa, Florida – U.S. District Judge Kathryn Kimball Mizelle has sentenced George Garcia (34, Tampa) to 21 months in federal prison for conspiracy to commit wire fraud. The Court also entered an order of forfeiture in the amount of $126,200, the proceeds of the wire-fraud conspiracy. Garcia had pleaded guilty on January 18, 2022.

According to court documents, Garcia owned and managed a construction company which purported to supply construction services and labor for construction contractors and subcontractors. In order to comply with Florida law, Garcia’s company was required to secure and maintain adequate worker’s compensation insurance coverage. Garcia’s company had agreements with contractors and subcontractors to use workers purported to be Garcia’s employees at construction sites and these workers were often undocumented aliens who were actually working for and under the daily supervision and direction of the contractors. Garcia or others would then regularly receive “payroll checks” from contractors that were cashed at various financial institutions to pay Garcia’s purported “employees” and other related expenses.

During the time period charged, Garcia falsely and fraudulently represented in insurance applications that his company had a very limited payroll and a very limited number of employees who worked on construction jobsites. Garcia also falsely and fraudulently sent wire communications to numerous contractors representing that his company’s employees had full worker’s compensation coverage.

In reality, Garcia’s company received and cashed more than $19 million in checks from various construction contractors for these purported “employees.” This payroll figure far exceeded the very limited payroll figures that Garcia had reported to his worker’s compensation insurance company. As a result, these employees, in reality the employees of other entities, performed work on jobsites without adequate insurance coverage. In addition, the insurers lost premiums they would have charged had they been aware of the true number of workers their policies were thus being manipulated to cover.

As a result of these misrepresentations, Garcia’s company also disclaimed responsibility for ensuring that jobsite workers were legally authorized to work in the United States and that required state and federal payroll taxes were being paid for these workers. The contractors who actually paid these workers’ wages and used their services were thus also able to avoid responsibility for those duties as well.

“Garcia is facing the consequences of his scheme to defraud the insurance company by severely misrepresenting his workers compensation policy,” said Assistant Special Agent in Charge John Dumas, HSI Tampa. “Garcia’s greed jeopardized the health and well-being of hundreds of non-citizen laborers who worked dangerous and difficult jobs without the safety net of proper workman’s compensation insurance.”

This case was investigated by Homeland Security Investigations and the State of Florida Department of Financial Services. It is part of an investigation by those agencies into the use of shell companies and “ghost” employees in the construction industry. It was prosecuted by Assistant United States Attorney Jay L. Hoffer.