Month: August 2022

Source: United States Department of Justice News

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced that Lee D. Weiss, 51, of Roslyn, NY, and Newton, MA, was sentenced today to five years in prison, three years of supervised release, and was ordered to pay $7.5 million in restitution and a $250,000 fine for his conviction of investment adviser fraud. The charges arose from Weiss’ multi-year investment scam that targeted his own clients and caused investor losses of more than $7 million.

In March 2022, the defendant pleaded guilty to investment adviser fraud in connection with this scheme to defraud his clients. Weiss was the principal of Family Endowment Partners, LP, an investment adviser registered with the U.S. Securities and Exchange Commission, which had an office in West Chester, PA, before it was closed by order of the SEC. The defendant used his position to fleece his own clients of millions of dollars through purported investments in a now-defunct Florida tobacco company and a series of private securities offerings. Weiss told his clients that their money would be used for investment purposes when, in fact, he diverted it to make Ponzi payments and to fund his lifestyle, and further told his clients that they were making money when their funds had already been misappropriated. Weiss continued to lie to them about the value of their investments to prevent them from learning of his thefts and to convince them to continue paying him fees for “managing” their money.

“Honesty, integrity, and trust all play a critical role in the relationship between a financial advisor and a client; when the advisor corrupts that relationship, the damage done to the financial security of the client can be catastrophic,” said U.S. Attorney Romero. “The end result is as devastating and traumatic as if the victim had been robbed at gunpoint, and therefore we take it just as seriously. We will continue to hold accountable those who, like Mr. Weiss, commit life-shattering financial crimes.”

“Lee Weiss’s clients expected him to invest their money responsibly and he had a fiduciary duty to do so. Instead, he misappropriated millions for his and his company’s purposes,” said Jacqueline Maguire, Special Agent in Charge of the FBI’s Philadelphia Division. “He used their funds for everything from car payments, to country club fees, to payouts to previous investors. Justice demands that financial fraudsters like Weiss be held accountable for their crimes and today’s sentencing ensures that.”

“The Postal Inspection Service has a long history of investigating investment frauds,” said Damon Wood, Inspector in Charge of the Philadelphia Division of the Postal Inspection Service. “Today, Lee Weiss was sentenced for stealing millions of dollars from his clients, clients who had trusted him to invest their money in safe, blue-chip investments. Through a web of corporate entities, Mr. Weiss hid the reality of his investment strategy and his failing business and stole his clients’ money to cover his own losses and continue living well. Thanks to the hard work of the Postal Inspectors, special agents from the FBI and the Assistant United States Attorneys, Mr. Weiss has been held accountable for his deceitful practices.”

The case was investigated by the Federal Bureau of Investigation and the U.S. Postal Inspection Service, and is being prosecuted by Assistant United States Attorneys Paul Shapiro and Nancy E. Potts. The U.S. Attorney’s Office appreciates the substantial assistance of the U.S. Securities and Exchange Commission in this matter.

Source: United States Department of Justice Criminal Division

A California man pleaded guilty yesterday in the Western District of Texas to conspiracy to solicit millions of dollars in contributions to two political action committees based on false and misleading representations that the funds would be used to support presidential candidates during and after the 2016 election cycle.

According to court documents, from 2016 through at least April 2017, Robert Reyes, Jr., 40, of Hollister, along with others, operated two political action committees—Liberty Action Group PAC and Progressive Priorities PAC—which solicited contributions from the public via robocalls and television, radio, and internet advertisements. The two PACs represented that the contributions would be used to support dueling presidential nominees of the two major political parties, respectively.  Instead, Reyes and his co-conspirators used the funds to enrich themselves and to fund additional fraudulent solicitations. Specifically, Reyes admitted that the two PACs raised approximately $3.5 million in contributions during the 2016 election cycle and subsequent months, of which Reyes received approximately $714,000. Of the approximately $3.5 million raised, the two PACs contributed approximately $19 to legitimate political causes.

Additionally, to conceal the origin and nature of the proceeds of the fraudulent scheme, Reyes and others instructed a third-party vendor to withdraw approximately $353,000 from the two PACs in excess of the payments for services rendered, then deposit the excess payments into accounts held by shell companies that they controlled. Reyes admitted to operating additional fraudulent PACs beyond the 2016 election cycle, Support American Leaders and Campaign to Support the President, from which he received approximately $95,000 generated from false and misleading solicitations to donors.

As part of his plea, Reyes agreed to forfeit $809,920.40 that he received for his participation in the scam-PACs during the scheme.

Reyes pleaded guilty to one count of conspiracy to commit wire fraud and to cause false statements to the Federal Election Commission and one count of money laundering. Sentencing will be scheduled at a later date. He faces a maximum penalty of 20 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division and Special Agent in Charge Oliver E. Rich of the FBI’s San Antonio Field Office made the announcement.

The investigation was conducted by the FBI’s San Antonio Division, Austin White Collar Crime Task Force.

Trial Attorneys Michael N. Lang and Celia Choy of the Criminal Division’s Public Integrity Section are prosecuting the case. Former PIN Trial Attorney Rebecca Schuman also contributed significantly to the investigation.

Source: United States Department of Justice News

Two human traffickers have been sentenced to a combined 25 years in federal prison, announced U.S. Attorney for the Northern District of Texas Chad E. Meacham.

Alfonso Orozco Juarez, 37, and Robert Hubert, 68, were first charged in October 2020. Mr. Hubert pleaded guilty in February 2022 to kidnapping and was sentenced in May 2022 to 121 months in federal prison; Mr. Juarez pleaded guilty in March 2022 to sex trafficking and was sentenced last week to 180 months in federal prison.

“Treated like chattel, the victim in this case endured horrors beyond imagining,” said U.S. Attorney Chad E. Meacham. “The North Texas Trafficking Task Force was launched to investigate and prosecute cases just like this one. We hope the sentences announced today will bring some peace to the victim as she recovers from her ordeal.”

“The physical and mental abuse suffered by the victim in this devasting sex-trafficking crime is heart-breaking. These perpetrators treated their victim as if she were personal property and not human,” said Special Agent in Charge Lester Hayes Jr., Homeland Investigations Dallas. “The HSI Dallas-led North Texas Trafficking Task Force will work relentlessly to eliminate these commercial sex-trafficking schemes. Fortunately, the defendants’ 25-year combined prison sentences will not allow them to target anyone else.”

According to plea papers, Mr. Juarez admitted that on Sept. 11, 2019, he authored a social media post advertising a sex “slave” who he claimed he had won in a card game. Mr. Hubert admitted that he responded to the post, offering to buy the “slave” for $5,000. In messages, Mr. Juarez referred to the victim as “property” and bragged that he “pistol whip[ped] her.”

On Sept. 18, 2019, the pair met at a gas station in Dallas, where Mr. Juarez handed over the victim in exchange for $5,000. On the drive back to his home, Mr. Hubert admitted, he clamped a metal collar around her neck.

Terrified, the victim texted Mr. Juarez, pleading for help: 

“I’m afraid if I don’t do something, he’s going to hurt me,” she said.

“Endure what you have to,” he responded. “He’ll punish you whip you . . . but not kill you.”

Once they reached his home, Mr. Hubert admitted, he handcuffed her and forced her to sleep naked at the foot of his bed. The victim eventually persuaded him to allow her to call her parents, who agreed to his demand of $5,000 for safe return. Eventually, the victim was able to escape the home.

Homeland Security Investigations and the North Texas Trafficking Task Force conducted the investigation with substantial support from the Crime Strategies Unit with the 2nd Judicial District Attorney’s Office in Albuquerque, NM. Assistant U.S. Attorneys Andrew Briggs and Rebekah Ricketts (fmr.) of the Northern District of Texas are prosecuting the case, with significant assistance from Assistant U.S. Attorney Letitia Simms of the District of New Mexico.

Source: United States Department of Justice News

INDIANAPOLIS – Davion Andrews, 28, of Indianapolis, was sentenced to 51 months in federal prison after pleading guilty to possession of a firearm by a convicted felon.

According to court documents, on January 22, 2021, Andrews crashed a borrowed car into a guardrail on I-70. An Indiana State Trooper arrived at the scene and began investigating the crash. During the investigation, the trooper saw a firearm magazine in Andrews’ jacket pocket and later discovered a firearm in the car. Further investigation revealed that, in 2020, Andrews was convicted of unlawful possession of a firearm by a serious violent felon in Marion County. Andrews was ordered to serve his sentence through Marion County Community Corrections. At the time of the crash, Andrews had covered his GPS monitoring band with foil, which is often done by individuals trying to hide their location from Community Corrections personnel.

Zachary A. Myers, U.S. Attorney for the Southern District of Indiana, and Daryl S. McCormick, Special Agent in Charge of ATF’s Columbus Field Division made the announcement. 

The Bureau of Alcohol, Tobacco, Firearms, and Explosives investigated the case. The Indiana State Police provided valuable assistance. The sentence was imposed by U.S. District Chief Judge Tanya Walton Pratt. As part of the sentence, Judge Pratt ordered that Andrews be supervised by the U.S. Probation Office for three years following his release from federal prison.

U.S. Attorney Myers thanked Assistant U.S. Attorney Michelle P. Brady who prosecuted 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 make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement, and the local community to develop effective, locally based strategies to reduce violent crime.

Source: United States Department of Justice News

Jacksonville, Florida – U.S. District Judge Marcia Morales Howard today sentenced Richard Earl Jenkins, Jr. (45, Jacksonville) to 25 years in federal prison, followed by10 years of supervised release for using a minor to produce sexually explicit images.  Jenkins had pleaded guilty on November 10, 2021.

According to court documents, on November 2 and 3, 2019, a 12-year-old child, Child Victim 1 (CV1) spent the night at Jenkins’s residence.  On November 6, 2019, an officer with the Jacksonville Sheriff’s Office (JSO) was dispatched to CV1’s mother’s residence regarding a complaint by CV1’s mother.  While CV1 was spending the night at the defendant’s residence, she discovered a folder on the defendant’s computer with her name on it.  CV1 said she opened the folder and discovered sexually explicit images of herself, from when she was younger to more recent.

On November 7, 2019, a JSO detective applied for, was granted, and executed a state search warrant at the defendant’s residence.  The desktop computer described by CV1 was located in the defendant’s bedroom.  A folder was observed on the bottom of the task bar, and when selected, revealed a folder named “[CV1]”. 

JSO conducted a forensic review of the devices seized. Several images depicting CV1 were discovered on the devices.  In addition to the images of CV1, hundreds of images of child sex abuse material were also discovered.

“Producers of child pornography are the worst of the worst, making victims of society’s most vulnerable victims” said HSI Jacksonville Assistant Special Agent in Charge K. Jim Phillips. “Through HSI’s law enforcement partnership with the Jacksonville Sheriff’s Office, this predator will now be held accountable for his heinous actions.”

This case was investigated by the Jacksonville Sheriff’s Office and Homeland Security Investigations. It was prosecuted by Assistant United States Attorney Ashley Washington.

It is another case 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.justice.gov/psc.