Security News: Union Man Pleads Guilty to Soliciting a Minor in Connection with Sex Trafficking

Source: United States Department of Justice News

Jackson, Miss. – A Union man pleaded guilty today to sex trafficking of a minor, announced U.S. Attorney Darren J. LaMarca and Special Agent in Charge Jermicha Fomby of the Federal Bureau of Investigation in Mississippi.

According to court documents, Hubert Lee Horton, 43, communicated with another individual by cell phone for the purpose of engaging in commercial sex with a minor.  Horton asked for and received images of the minor and negotiated the price that he would pay for various sexual acts. 

Horton pleaded guilty to a violation of Title 18, United States Code, Section 1591(a)(1) which criminalizes the trafficking of a minor child for purposes of engaging in sexual intercourse for money. He is scheduled to be sentenced on September 1, 2022 and faces a minimum penalty of 10 years in prison and a maximum of life in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

The Union Police Department, Mississippi Bureau of Investigations, and the FBI are investigating the case.

Assistant U.S. Attorney Charles W. Kirkham is prosecuting the case.

This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc.

Security News: Former Stone County Sheriff’s Deputy Faces Fraud, Extortion, and Firearms Charges

Source: United States Department of Justice News

      LITTLE ROCK—A former Chief Deputy with the Stone County Sheriff’s Office appeared in federal court today for arraignment on charges of bank fraud, selling a stolen firearm, and extortion. Zachary Hunter Alexander, 36, of Fifty Six, Arkansas, was indicted by a federal grand jury on May 3 and made his initial appearance today before United States Magistrate Judge Edie R. Erwin.

      The indictment alleges that Alexander solicited money in 2018 from the Stone County Sheriff’s Foundation to purchase AR-15 style firearms for the Sheriff’s Office. According to the indictment, the Foundation provided over $4,000, which Alexander deposited into his personal account. Allegedly, Alexander provided and signed an invoice listing six firearms and their serial numbers, which turned out to be fraudulent, and this invoice was used to authorize a $3,090 expenditure on the Sheriff’s Office credit card.

      In addition to those firearms, the indictment claims Alexander sold a sniper rifle to another individual, which is the basis of the charge of selling a stolen firearm, as the firearm belonged to the Stone County Sheriff’s Office and was purchased with Foundation money.  Alexander also faces five charges of extortion under color of official right, and the indictment alleges he misused his authority as Chief Deputy Sheriff to obtain money that he used for himself. The indictment alleges that Alexander made various deposits totaling more than $105,000.

      If convicted, Alexander faces potential penalties for bank fraud of not more than 30 years imprisonment, a fine of not more than $1 million, and not more than five years of supervised release. Selling a stolen firearm carries a penalty of not more than ten years imprisonment, a fine of not more than $250,000, and not more than three years of supervised release. Extortion under color of official right is punishable by not more than 20 years imprisonment, a fine of not more than $250,000, and not more than three years of supervised release.

      An indictment only contains allegations. A defendant is presumed innocent unless and until proven guilty.  

# # #

This news release, as well as additional information about the office of the

United States Attorney for the Eastern District of Arkansas, is available online at

https://www.justice.gov/edar

Twitter:

@EDARNEWS

Security News: Mastermind of $11.1 million Paycheck Protection Program fraud scheme sentenced to fifteen years

Source: United States Department of Justice News

ATLANTA – Darrell Thomas has been sentenced after pleading guilty to conspiracy to commit bank fraud and wire fraud and to money laundering for masterminding a scheme to obtain 14 fraudulent loans totaling approximately $11.1 million from the Paycheck Protection Program (“PPP”).  To date, a total of twenty-three individuals have been charged in connection with the fraudulent scheme. 

“Thomas took advantage of pandemic relief funds intended for struggling small businesses to line his own pockets,” said U.S. Attorney Ryan K Buchanan.  “Every dollar he took diverted funds from legitimate business owners suffering the effects of the COVID-19 pandemic who desperately needed assistance to pay their employees.  The sentence imposed today shows that fraud does not pay.” 

“Thomas orchestrated a massive fraudulent scheme to greedily line his pockets with stolen government funds that were intended to provide relief to small businesses and their employees during the COVID-19 Pandemic”, said Keri Farley, Special Agent in Charge of FBI Atlanta. “Hopefully, Thomas enjoyed his short-lived fun with all the luxury items purchased with stolen tax payer money, as he will now pay for his crimes with a lengthy prison sentence.”

“The charges and last week’s sentencing show IRS Criminal Investigation’s commitment to defend the integrity of the pandemic relief programs,” said IRS-Criminal Investigation Special Agent in Charge James E. Dorsey.  “We will continue to contribute our financial expertise to identify fraud, trace the funds, and bring the criminals to justice.”

“These results demonstrate the commitment of the Treasury Inspector General for Tax Administration to investigate and bring to justice those who attempt to corruptly interfere with Federal tax administration,” said J. Russell George, the Treasury Inspector General for Tax Administration.  “We appreciate the work of the U.S. Attorney’s Office and our law enforcement partners to ensure this criminal activity is held to account.”

“OIG continues to bring to justice those persons who would seek to exploit federal programs for unlawful personal gain,” said SBA OIG’s Eastern Region Special Agent in Charge Amaleka McCall-Brathwaite. “Our Office will remain relentless in the pursuit of fraudsters who seek to exploit SBA’s vital economic programs. I want to thank the U.S. Attorney’s Office and our law enforcement partners for their dedication and commitment to seeing justice served.”

According to U.S. Attorney Buchanan, the second superseding indictment, and other information presented in court: From April 2020 through August 2020, Darrell Thomas orchestrated a PPP loan scheme involving at least fourteen fraudulent loans.  Each of the fourteen businesses obtained a PPP loan between $700,000 and $850,000, for a total of over $11.1 million.  The loan applications certified that each applicant business was in operation on February 15, 2020 and had employees for whom it paid salaries and payroll taxes or paid independent contractors; that the funds would be used to retain workers and maintain payroll or make mortgage interest payments, lease payments, and utility payments; and that the information provided in the application and in all supporting documents and forms was true and accurate in all material respects.

The PPP loan applications reported that each business had between 59 and 69 employees and approximately $295,000 to $342,000 in average monthly payroll expenses.  To support these payroll figures, each business’s loan application was accompanied by an Internal Revenue Service Form 941, which employers use to report payroll taxes, for each quarter of 2019 and by a bank statement or a spreadsheet reflecting payroll expenses.  In reality, however, none of the businesses had employees or payroll expenses.  The Form 941s, bank statements, and W2 payroll spreadsheets had all been fabricated.  Indeed, some of the supporting documents the businesses submitted were substantively identical, including identical Form 941s and identical bank statements.  

After the PPP loan proceeds were deposited into the businesses’ accounts, the businesses transferred more than $5.5 million of the PPP loan proceeds into accounts controlled by Darrell Thomas, purportedly for rental payments and payroll.  However, none of the businesses had any legitimate business with any of the businesses or accounts to which they sent the proceeds.  Based on the investigation, none of the companies allegedly engaged in any business-related transactions or used the PPP loan proceeds for any authorized purposes.  Instead, the businesses used the funds for various personal expenses.  In connection with the investigation, the United States seized more than $4 million in PPP loan proceeds, four luxury vehicles, and several jewelry items. 

Darrell Thomas, 36, of Johns Creek, Georgia, was sentenced by U.S. District Judge J. P. Boulee to fifteen years in prison, to be followed by five years of supervised release, and ordered to pay restitution in the amount of $13,206,752.10.  On June 16, 2021, he pleaded guilty to one count of conspiracy to commit bank fraud and wire fraud and one count of money laundering.  As part of his guilty plea, Thomas admitted his participation in fraudulent conduct totaling more than $14.7 million, including approximately $11.1 million in fraudulent PPP loans, more than $1.15 million in fraudulent Economic Injury Disaster Loans, and more than $2.4 million in fraudulent automobile loans. 

He also agreed to forfeit various assets, including more than $2.1 million in seized funds, three luxury vehicles – a 2018 Mercedes-Benz S-Class S65AMG, a 2018 Land Rover Range Rover, and a 2017 Acura NSX – and several items of jewelry, including a gold Rolex. 

To date, a total of twenty-three individuals have been charged in connection with the fraudulent scheme.  Eleven other individuals have pleaded guilty and six other individuals have been sentenced, while the remaining eleven individuals’ charges remain pending.     

The following defendants have either pleaded guilty based on their roles in the fraudulent scheme or have been sentenced to date:

  • Charles Petty a/k/a Charles Knight, 49, of Stone Mountain, Georgia, pleaded guilty to one count of conspiracy to commit bank fraud and wire fraud in connection with the loan obtained by Transportation Management Services Inc.  On February 23, 2022, Judge Boulee sentenced Petty to three years and ten months’ imprisonment and five years of supervised release, and Judge Boulee ordered him to pay $830,417 in restitution and a special assessment of $100.
  • Khalil Gibran Green, Sr., 47, of Cleveland, Ohio, pleaded guilty on September 1, 2020, to one count of conspiracy to commit bank fraud and wire fraud in connection with the loan obtained by his business, Impact Creations LLC.  On January 14, 2021, Judge Boulee sentenced Green to three years and five months’ imprisonment and five years of supervised release, and Judge Boulee ordered him to pay $830,000 in restitution, forfeiture of $157,035.71, and a special assessment of $100.
  • Bern Benoit, 45, of Burbank, California, pleaded guilty on March 11, 2021, to one count of conspiracy to commit bank fraud and wire fraud in connection with the loan obtained by his business, Transportation Management Services Inc.  On September 8, 2021, Judge Boulee sentenced Benoit to two years and three months’ imprisonment and five years of supervised release, and Judge Boulee ordered him to pay $1,105,217 in restitution, forfeiture of $461,433.36, and a special assessment of $100.
  • Charmaine Redding, 28, of Macomb, Michigan, pleaded guilty on July 14, 2021, to one count of conspiracy to commit wire fraud in connection with the loan obtained by her business, All Star Room and Board Services of Michigan Inc.  On October 21, 2021, Judge Boulee sentenced Redding to two years and three months’ imprisonment and three years of supervised release, and Judge Boulee ordered her to pay $1,159,138.31 in restitution and a special assessment of $100.
  • Charles Hill IV, 46, of Norcross, Georgia, pleaded guilty on September 29, 2021, to one count of conspiracy to commit wire fraud in connection with the loan obtained by his business, Infinite Education Services Inc.  On January 12, 2022, Judge Boulee sentenced Hill to five years’ probation, with the first twenty-seven months to be served on home detention.  Judge Boulee ordered him to pay $1,004,805 in restitution and a special assessment of $100.
  • Andre Lee Gaines, 67, of Dallas, Georgia, pleaded guilty on June 17, 2021, to one count of making false statements to the FBI in connection with the loan obtained by his business, Gaines Reservation and Travel.  On October 5, 2021, Judge Boulee sentenced Gaines to five years of probation and ordered him to pay restitution of $806,710 and a special assessment of $100.
  • Denesseria Slaton, 53, of McDonough, Georgia, pleaded guilty on June 16, 2021, to one count of conspiracy to commit bank fraud wire fraud in connection with the loan obtained by Transportation Management Services Inc.  Slaton’s sentencing is set for June 21, 2022.
  • Jesika Blakely, 34, of Atlanta, Georgia, pleaded guilty on March 15, 2022, to one count of conspiracy to commit money laundering in connection with her involvement in Thomas’s scheme.  Blakely’s sentencing is set for June 29, 2022.
  • Amanda Christian, 34, of Blythewood, South Carolina, pleaded guilty on March 23, 2022, to one count of conspiracy to commit wire fraud in connection with the loan obtained by Mickies Auto and Tire LLC.  Christian’s sentencing is set for June 30, 2022.
  • Derek Parker, 57, of Rochester Hills, Michigan, pleaded guilty on April 14, 2022, to one count of conspiracy to commit wire fraud in connection with the loan obtained by his business, D Parker Holdings Inc.  Parker’s sentencing is set for July 28, 2022.
  • Rick McDuffie, 51, of Little Rock, South Carolina, pleaded guilty on April 27, 2022, to one count of conspiracy to commit wire fraud in connection with the loan obtained by his business, Mickies Auto and Tire LLC.  McDuffie’s sentencing is set for August 23, 2022.

This case is being investigated by the Federal Bureau of Investigation, the Internal Revenue Service-Criminal Investigation, the U.S. Treasury Inspector General for Tax Administration, and the Small Business Administration-Office of the Inspector General.

Assistant U.S. Attorneys Tal Chaiken and Nathan Kitchens of the Northern District of Georgia and Trial Attorney Siji Moore of the Criminal Division’s Fraud Section are prosecuting the case.

On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud.  The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts,  For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.

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

For further information please contact the U.S. Attorney’s Public Affairs Office at USAGAN.PressEmails@usdoj.gov or (404) 581-6016.  The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.

Security News: Modesto Man Indicted for Escape from Custody

Source: United States Department of Justice News

FRESNO, Calif. — A federal grand jury returned a one-count indictment today against Fernando Corrales, 23, of Modesto, charging him with escape from custody, U.S. Attorney Phillip A. Talbert announced.

According to court documents, on Jan. 19, 2022, Corrales was ordered confined at the Turning Point Residential Re-Entry Center in Fresno after a conviction in the District of Oregon for conspiracy to possess and distribute heroin. While Corrales was allowed to be on home confinement, on Feb. 20, 2022, he cut off his ankle monitor and absconded. His whereabouts were unknown until his arrest.

This case is the product of an investigation by the U.S. Marshals Service. Assistant U.S. Attorney Laurel J. Montoya is prosecuting the case.

If convicted, Corrales faces a maximum statutory penalty of five years in prison and a $250,000 fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

Security News: Poplar woman admits assault, child abuse crimes

Source: United States Department of Justice News

GREAT FALLS — A Poplar woman suspected of assaulting a toddler on the Fort Peck Indian Reservation admitted to charges this week, U.S. Attorney Leif M. Johnson said today.

Shelby Loves Him, 23, pleaded guilty on May 16 to an indictment charging her with assault resulting in serious bodily injury and felony child abuse. Loves Him faces a maximum of 10 years in prison, a $250,000 fine, and three years of supervised release.

Chief U.S. District Judge Brian M. Morris presided. The court will determine a sentence after considering the U.S. Sentencing Guidelines and other statutory factors. Sentencing was set for Aug. 24. Loves Him was detained pending further proceedings.

Court documents filed by the government alleged that Loves Him had been caring for the victim, a toddler, identified as John Doe, since approximately August 2021 when on Dec. 8, 2021, law enforcement officers were contacted about John Doe being unresponsive at the Poplar Community Hospital. The officers observed bruising and scratches on John Doe’s head, arms and legs. When questioned about events leading to John Doe arriving at the hospital, Loves Him told officers that she had struck John Doe multiple times in the week leading up to an incident on Dec. 8, 2021, when she assaulted and choked the victim until he lost consciousness. John Doe was flown to Salt Lake City, Utah, for emergency life-saving surgery and care. John Doe continues to suffer significant impairment from the injuries he sustained.

Assistant U.S. Attorney Wendy A. Johnson is prosecuting the case, which was investigated by the FBI, Montana Highway Patrol and Fort Peck Tribes Police Department.

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