Month: August 2022

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Security News: St. Johnsbury Business Owner Sentenced to Imprisonment for Tax Evasion

Source: United States Department of Justice News

The Office of the United States Attorney for the District of Vermont stated that Blakely H. Jenkins, Sr., 61, of St. Johnsbury, Vermont, was sentenced today to one year and one day of imprisonment for evading taxes and committing identity theft while running his St. Johnsbury-based painting business, Blake Jenkins Painting, Inc.  United States District Judge William K. Sessions III also ordered Jenkins to serve a two-year term of supervised release.

In February 2022, Jenkins pleaded guilty to two counts of evasion of employment taxes and one count of identity theft.  According to court records and proceedings, Jenkins evaded employment taxes from mid-2015 to mid-2020 by paying his employees “off the books” wages either in cash or in checks falsely denoted as being for non-wage purposes.  Jenkins took a number of steps to execute this plan, including falsifying records, creating bogus documents, and signing another person’s name without permission.  Every employment tax return that Jenkins’ company submitted to the Internal Revenue Service during this period contained false information that significantly underreported the amounts that Jenkins actually paid his employees.  In total, Jenkins’ company failed to report over $1.3 million in employee wages, resulting in over $340,000 in unpaid federal taxes.  

“Investigating and prosecuting white collar offenses is a top priority of the U.S. Attorney’s Office,” said United States Attorney Nikolas P. Kerest.  “We will continue to work closely with the Criminal Division of the Internal Revenue Service and our other excellent law enforcement partners to hold accountable those who line their own pockets at the expense of others, whether by avoiding their tax obligations, collecting benefits to which they are not entitled, or defrauding victim individuals or companies.”

“The IRS Criminal Investigation Division takes these violations of law very seriously,” said Joleen D. Simpson, Special Agent in Charge, IRS Criminal Investigation, Boston Field Office.  “By not reporting all wages to the IRS, hardworking employees may not have access to all of the Social Security, Medicare and Unemployment Compensation they are entitled to receive. Employers have an obligation to their employees to not only accurately report all wages, but to pay over all tax withholdings.  Investigating employment tax fraud is a priority for the special agents of IRS Criminal Investigation as we strive to protect the trust that individuals put in their employers to make sure their future benefits are secure.”

The United States was represented in this matter by Assistant U.S. Attorney Nicole Cate.  Jody Frey, Esq. represented the defendant.

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Security News: “Boiler Room” Operator Pleads Guilty to International Securities Fraud Conspiracy

Source: United States Department of Justice News

Defendant and Co-Conspirators Manipulated the Price and Trading Volume of a Publicly Traded Stock in the United States

Earlier today, in federal court in Brooklyn, Lee Cohen, a citizen of the United Kingdom, pleaded guilty to conspiracy to commit securities fraud for his role in a scheme to manipulate the price and trading volume of HD View, 360, Inc. (HDVW), a publicly traded company that purported to distribute and install security surveillance systems.  In connection with his plea, Cohen also admitted that he agreed to launder money that was purported to be the proceeds of similar securities fraud schemes.  The proceeding was held before United States District Judge Kiyo A. Matsumoto.  When sentenced, Cohen faces up to five years in prison.

Breon Peace, United States Attorney for the Eastern District of New York, and Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI) announced the guilty plea.

“Cohen ran his scam from a ‘boiler room’ more than 8,000 miles from the federal courtroom in Brooklyn where he pleaded guilty today to defrauding investors, proving that distance will never protect criminals from the reach of our Office’s outstanding attorneys and FBI Special Agents who brought the defendant to justice,” stated United States Attorney Peace.

Mr. Peace thanked the United States Securities and Exchange Commission, New York Regional Office and Washington, D.C. Office, for their assistance in the case. 

As set forth in court filings, Cohen operated a self-described “boiler room” in the Philippines.  Cohen and his co-conspirators used the boiler room to defraud investors and potential investors in HDVW by inducing investors to buy HDVW shares at particular prices.  At the same time, Cohen coordinated with a co-conspirator who controlled the majority of HDVW’s shares, then sold the shares for a profit.  During the scheme, over 1,000 investors purchased shares of HDVW and lost more than $1.2 million.   

In July 2022, Mr. Peace was selected as the Chairperson of the White Collar Fraud subcommittee for the Attorney General’s Advisory Committee (AGAC).  As the leader of the subcommittee, Mr. Peace will play a key role in making recommendations to the AGAC to facilitate the prevention, investigation and prosecution of various financially motivated, non-violent crimes including mail and wire fraud, bank fraud, health care fraud, tax fraud, securities and commodities fraud, and identity theft. 

The government’s case is being handled by the Office’s Business and Securities Fraud Section.  Assistant United States Attorneys David Gopstein and Nicholas J. Moscow are in charge on the prosecution. 

The Defendant:

LEE COHEN
Age:  52
Manila, Philippines

E.D.N.Y. Docket No. 22-CR-209 (KAM)

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Security News: Justice Department Secures Settlement in Race Discrimination and Retaliation Suit Against SEPTA

Source: United States Department of Justice News

The Department of Justice announced today that it has reached a settlement with the Southeastern Pennsylvania Transportation Authority (SEPTA), a regional public transportation authority based in Philadelphia. The settlement resolves the department’s complaint alleging that three officers of the SEPTA Police Department were subjected to a hostile work environment by their supervisor and experienced retaliation when they opposed the harassment, in violation of Title VII of the Civil Rights Act of 1964 (Title VII). Title VII is a federal statute that prohibits employment discrimination on the basis of race, color, national origin, sex and religion, and prohibits retaliation against employees for opposing employment practices that are discriminatory under Title VII.

“All transit police officers deserve to go to work each day without fear of harassment and retaliation from their supervisors and colleagues,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “This settlement sends a clear message that the department stands ready to protect employees who are subject to racial harassment and a hostile work environment, particularly in law enforcement agencies dedicated to serving the public.”

The department’s complaint, filed today in the U.S. District Court for the Eastern District of Pennsylvania, alleges that SEPTA subjected the officers, who belonged to a special investigative unit, to racial and religious harassment and retaliated against them because they opposed the harassment. According to the complaint, the officers’ supervisor repeatedly harassed them with racial slurs and derogatory comments about Black people and Muslims, threatened the officers and physically assaulted them. The complaint further alleges that the Police Chief retaliated against the officers for opposing the harassment. The officers’ supervisor and the Police Chief are no longer employed by SEPTA. According to the complaint, although two of the officers are white, they too are protected by Title VII because they also suffered injury from the harassment, were not mere bystanders and were retaliated against for speaking up against the harassment. Under the terms of the consent decree, if approved by the court, SEPTA will implement anti-discrimination and retaliation policies and provide trainings for its employees. SEPTA will also pay the officers a total of $496,000 in compensatory damages.

The United States’ complaint is based on charges of discrimination filed with the Equal Employment Opportunity Commission’s Philadelphia District Office, which investigated the charges and found reasonable cause that SEPTA violated Title VII. After unsuccessful conciliation efforts, the EEOC referred the charges to the Justice Department.

The full and fair enforcement of Title VII is a top priority of the Justice Department’s Employment Litigation Section of the Civil Rights Division. Additional information about the Civil Rights Division and the jurisdiction of the Employment Litigation Section is available on its websites at www.justice.gov/crt and www.justice.gov/crt/employment-litigation-section.

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Security News: Cranston Man Admits to Role in Drug Trafficking Organization That Shipped More Than 50 Kilos of Cocaine into Rhode Island

Source: United States Department of Justice News

PROVIDENCE – A Cranston man today admitted to a federal judge that he played a long-running role in a drug trafficking organization (DTO) that U.S. Postal Service Inspectors determined shipped or attempted to ship a total of more than 50 kilograms of cocaine into Rhode Island, announced United States Attorney Zachary A. Cunha.

Nelson Santos Carvalho, 47, admitted that he provided members of the DTO in Puerto Rico residential and business addresses in Rhode Island to use for shipping U.S. Priority mail parcels, each containing approximately one kilogram of cocaine; discussed arrival dates and retrieval of the parcels with co-conspirators; retrieved the packages from locations throughout Rhode Island, including his work address; transported the cocaine to co-conspirators in Rhode Island; and performed other functions as needed to facilitate the operations of the DTO.

Carvalho is the fourth defendant to admit his role in this DTO that operated in both Rhode Island and Puerto Rico.

According to charging documents, for more than 18 months, beginning in January 2018, Carvalho provided the DTO with various Rhode Island addresses at which he and other persons known to him lived and worked.  At least eleven of the parcels were shipped to Women and Infants Hospital where Carvalho was employed as a mail clerk, addressed to names provided to the DTO by the defendant. Carvalho retrieved the packages from the post office and provided them to other co-conspirators.

Based on the packages seized, the known size and weights of many of the parcels not intercepted, and positive K9 alerts on packaging materials discarded by DTO members, the DTO is believed to have shipped and/or attempted to ship approximately 51 kilos of cocaine into Rhode Island.

Appearing today before U.S. District Court Judge Mary S. McElroy, Carvalho pleaded guilty to conspiracy to distribute and to possess with intent to distribute 500 grams or more of cocaine. He is scheduled to be sentenced on November 3, 2022. The defendants’ sentences will be determined by a federal district judge after consideration of the U.S. Sentencing Guidelines and other statutory factors.

Co-conspirators George Mojica, 42, Angel Delgado, 25, and Arcadio Torres, 30, of Central Falls, previously admitted to a federal judge that they participated in the conspiracy and performed various functions to assist the DTO. Mojica and Delgado were sentenced in May to serve seven years and five years in federal prison respectively; Torres is awaiting sentencing.

The case is being prosecuted by Assistant U.S. Attorney Denise M. Barton.

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Security News: Lowell Woman Arrested for Trafficking Firearms

Source: United States Department of Justice News

Defendant allegedly offered at least nine firearms for sale to cooperating witness, including AR-15 rifle

BOSTON – A Lowell woman was arrested on July 29, 2022 for allegedly trafficking firearms without a license. 

Leticia Alcantara, 25, was charged with one count of dealing in firearms without a license. Alcantara will appear in federal court in Boston this afternoon.

“Illegal firearms trafficking stokes violent crime trends and poses a very real threat to the safety our communities,” said United States Attorney Rachael S. Rollins. “We believe Ms. Alcantara contributed to this violent threat through regular sales offers for numerous firearms, including an AR-15 rifle. She held no license and was ready to sell firearms that could have gone to prohibited individuals. This is dangerous and could have resulted in significant violence and harm. We will continue to work with our law enforcement partners to identify and prosecute those engaged in illegal firearms trafficking.”

According to the charging document, law enforcement opened an investigation in October 2021 into firearms trafficking in Massachusetts and identified Alcantara as an alleged firearms dealer. On Feb. 15, 2022, Alcantara allegedly offered to sell a 9mm handgun to two individuals who, unbeknownst to her, were cooperating with law enforcement. It is alleged that, on March 15, 2022, Alcantara met with the cooperating witnesses at a prearranged meeting location in a parking lot in Falmouth to conduct the transaction. There, Alcantara was observed entering the vehicle occupied by the cooperating witnesses and allegedly produced a black trash bag from her purse that contained the firearm. 

It is further alleged that, on multiple occasions in July 2022, Alcantara communicated with one of the cooperating witnesses regarding additional firearms she was offering for sale, including sending photos of: a 9mm handgun on July 2, 2022; a small holster-grip revolver and one large black pistol on July 7, 2022; and two handguns on July 9, 2022. At the direction of law enforcement, the cooperating witness agreed to purchase the last two handguns Alcantara offered for sale. On July 12, 2022, Alcantara met with the cooperating witnesses during a controlled purchase in Plymouth. There, Alcantara was observed entering the vehicle and allegedly produced one .45 caliber pistol and one 9mm pistol from a dark colored bag.

On July 12, 2022, Alcantara sent additional photos of two firearms for sale which, at the direction of law enforcement, the cooperating witness agreed to purchase. On July 19, 2022, Alcantara arrived at the same prearranged meeting location in Plymouth where she allegedly entered the cooperating witnesses’ vehicle and provided two 9mm pistols. Following the transaction, Alcantara allegedly continued communicating with the cooperating witness about additional firearms for sale, including a handgun and an AR-15 rifle.

The charge of dealing in firearms without a license provides for a sentence of up to five years in prison, up to three years of supervised release and a fine of up to $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.

U.S. Attorney Rollins and James Ferguson, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms & Explosives, Boston Field Division made the announcement today. Valuable assistance in the investigation was provided by the Plymouth and Falmouth Police Departments. Assistant U.S. Attorney Charles Dell’Anno of Rollins’ Major Crime Unit is prosecuting the case.

The details contained in the charging documents are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.