Month: November 2022

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Security News: Louisiana Man Pleads Guilty to Conspiring to Compel Labor by Three Minors and to Transporting a Minor with Intent to Engage in Criminal Sexual Activity

Source: United States Department of Justice News

Darnell Fulton, 38, of Pineville, Louisiana, pleaded guilty today to conspiring to compel labor by three minors and to transporting a minor with intent to engage in criminal sexual activity.

According to the plea agreement, between June 2016 and May 2019, the defendant used violence, sexual abuse, withholding of food, degradation and intimidation to coerce multiple minors to work for his brownie baking business and provide him with the business profits. The defendant required the victims to travel to as many as 20-30 locations a day, such as plazas, car dealerships, law firms, restaurants and parking lots, in order to sell brownies. The victims worked late into the night, either selling or baking the brownies, and sold them during the day instead of going to school. In fact, the victims typically worked seven days a week with very few breaks, and had to meet a sales quota every day. The defendant regularly assaulted the victims, especially if they did not meet his sales quotas. For example, the defendant frequently required the victims to get on their hands and knees on rice and stay in a pushup or plank position for hours, and he often whipped them with a belt if they got out of proper form. He also forced the minor victims to perform sexual acts with him and others, and transported them across state lines in order to engage in criminal sexual activity.

“Human trafficking is a heinous crime that targets some of the most vulnerable people in our communities, cruelly exploiting the victims for their labor and services,” said Assistant Attorney General Kristen Clarke for the Justice Department’s Civil Rights Division. “This conviction makes clear that the Department of Justice will prosecute those who use violence, psychological abuse, and emotional manipulation to compel the labor and services of their victims. We encourage survivors of forced labor, including children, to report forced labor complaints to authorities.”

“This case is proof that human trafficking doesn’t just happen in other countries,” said U.S. Attorney Brandon B. Brown for the Western District of Louisiana.  “But in fact, human trafficking can be happening right in our own neighborhoods and communities without us even realizing it.  Each of us must be vigilant and aware of our surroundings and if we see a situation that seems suspicious, take the time to report it to the police. Unfortunately, the victims in this case are the ones who have suffered life-long trauma because of this defendant’s horrendous acts. We will continue fighting for victims such as these to ensure that those who choose to inflict this type of harm on others are brought to justice.”

Fulton’s sentencing hearing has been scheduled for April 11, 2023. Fulton faces a mandatory minimum of 10 years imprisonment and a maximum penalty of up to life imprisonment, as well as a $250,000 fine for transporting a minor with intent to engage in criminal sexual activity, and a maximum penalty of 20 years and a $250,000 fine for conspiracy to commit forced labor. As part of his plea agreement, the defendant agreed to a sentence of 35 years in prison and to pay more than $700,000 in restitution to the victims.

Assistant Attorney General Clarke and U.S. Attorney Brown made the announcement.  

The FBI Alexandria Field Division investigated this case, with assistance from the Alexandria Police Department. Assistant U.S. Attorney John Luke Walker for the Western District of Louisiana and Trial Attorney Maryam Zhuravitsky of the Justice Department’s Human Trafficking Prosecution Unit are prosecuting the case.

Anyone who has information about human trafficking should report that information to the National Human Trafficking Hotline toll-free at 1-888-373-7888, which is available 24 hours a day, seven days a week. For more information about human trafficking, please visit www.humantraffickinghotline.org. Information on the Department of Justice’s efforts to combat human trafficking can be found at www.justice.gov/humantrafficking.

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Security News: Guatemalan National Sentenced for Smuggling Unaccompanied Child into the United States

Source: United States Department of Justice 2

A Guatemalan national was sentenced by U.S. District Court Judge Kenneth Marra on Nov. 3 to 36 months in prison in the Southern District of Florida for smuggling an unaccompanied 15-year-old child into the United States for financial gain. The defendant was convicted by federal jury in July 2022.

According to the evidence presented in court, Julio Ruiz Chuta, 35, was familiar with the child victim and child’s family since they were from the same village in Guatemala. The defendant told the child’s parents that he could help the child obtain better educational and work opportunities in the United States versus the poor opportunities that existed in Guatemala. The parents believed that the defendant would sincerely help them since he had been to the United States before and he promised to care for their child.  Consequently, the parents allowed the child to travel to the United States and permitted the defendant to act as his guardian in the United States even though they were not related. After the child passed illegally through the southern border of the United States and presented himself to authorities, he was placed in a shelter. The defendant assured appropriate authorities that he would care for the child by enrolling the child in school and providing a place to live, and that he would not impose a debt upon the child. However, the defendant did impose a debt upon the child and his family after the child arrived in Florida. Further, the defendant charged the family interest and pressured them to pay, causing the child to work instead of attending school. The defendant also caused the family to leverage their own Guatemalan property to acquire a loan to repay the outstanding debt.

“This defendant exploited a child and the child’s family after falsely telling authorities that he would provide food, shelter, and better educational opportunities, all so he could make money off the child and his family,” said Assistant Attorney General Kristen Clarke for the Justice Department’s Civil Rights Division. “The Department of Justice remains committed to vindicating the rights of vulnerable members of our society and will continue to prosecute those who cruelly exploit their labor and services.”

“It is shameful that situations like this involving children continue to occur,” said U.S. Attorney Juan Antonio Gonzalez for the Southern District of Florida. “The strain these types of cases put on a family is immeasurable. We will continue to go after these perpetrators with every resource available.”

Homeland Security Investigations and the Palm Beach County Sheriff’s Office investigated the case.

Assistant U.S. Attorney Gregory Schiller for the Southern District of Florida and Trial Attorney Kate Hill of the Civil Rights Division’s Human Trafficking Prosecution Unit prosecuted the case. 

Anyone who has information about human trafficking should report that information to the National Human Trafficking Hotline toll-free at 1-888-373-7888, which is available 24 hours a day, seven days a week. For more information about human trafficking, please visit www.humantraffickinghotline.org.

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Security News: Utica Resource Operating Agrees to Pay $1 Million Penalty and Mitigate Past Excess Air Pollution at Oil and Gas Production Wells

Source: United States Department of Justice 2

Settlement Will Reduce Climate Harming Methane by 940 Tons and CO2 by 4,429 Tons  

United States today announced that Utica Resource Operating LLC (URO) has agreed to a settlement resolving alleged Clean Air Act violations at URO’s oil and gas production well facilities in Ohio. The settlement addresses URO’s failure to capture and control air emissions from storage vessels and to comply with associated inspection, recordkeeping and reporting requirements.

Under the terms of the settlement, URO will complete a $1.5 million suite of injunctive relief at 15 well pad facilities to come into compliance with the Clean Air Act and the facilities’ operating permits; implement mitigation measures at many of the wells owned by URO, and pay a penalty of $1 million. The injunctive relief includes a multi-step compliance program to review the current design of each storage vessel system and then make necessary design improvements to ensure that vapors will not be released to the environment during operations.

“This settlement not only requires URO to pay a significant civil penalty, it also requires pollution reductions to offset the effects of the company’s past violations,” said Assistant Attorney General Todd Kim of the Justice Department’s Environment and Natural Resources Division. “These mitigation measures will reduce the emission of harmful volatile organic compounds and greenhouse gases into the environment.”

“Utica Resource Operating’s failure to control emissions from its facilities in Guernsey, Morgan and Washington Counties placed our fellow citizens in harm’s way,” said U.S. Attorney Kenneth L. Parker for the Southern District of Ohio. “Today’s settlement, which includes a significant fine, will require URO to comply with the Clean Air Act, and further reinforce the Department of Justice’s commitment to take aggressive action to protect the citizens of this country. We will continue to hold entities who violate the nation’s environmental laws, such as the Clean Air Act, accountable for their actions. My office is committed to keeping our citizens safe.”

“The uncontrolled air emissions from these well facilities were creating poor air quality for residents of Ohio,” said Acting Assistant Administrator Larry Starfield of EPA’s Office of Enforcement and Compliance Assurance. “Today’s agreement not only requires the company to resolve their outstanding pollution violations, but also take measures to control their methane and carbon dioxide emissions, which are significant contributors to climate change.”

The settlement also requires URO to invest approximately $1.5 million in equipment upgrades and retrofits. These mitigation measures will further reduce pollution at URO well pads to offset past excess emissions from URO’s violations. In total, the improvements will result in estimated annual reductions of 307 tons of volatile organic compounds (VOC), 940 tons of methane and 4,429 tons of carbon dioxide. VOCs include a variety of chemicals that may cause adverse health effects, while methane and carbon dioxide are greenhouse gases contributing to climate change.

The EPA found widespread problems with uncontrolled VOC emissions from oil and wastewater storage vessels during inspections of 11 URO well facilities in 2019. These emissions came from pressurized gases venting through imperfectly sealed access hatches on top of the storage vessels, pressure relief devices and combustors. After learning of other violations relating to inspections, recordkeeping and reporting, EPA issued a notice and finding of violation to URO on Aug. 14, 2020.

The settlement terms are included in a proposed consent decree that the Department of Justice filed today with the U.S. District Court for the Southern District of Ohio. The proposed consent decree is subject to a 30-day public comment period and final court approval. It is available on the Justice Department website at www.usdoj.gov/enrd/Consent_Decrees.html.

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Security News: Former CEOs of MoviePass and Parent Company Charged in Securities Fraud Scheme

Source: United States Department of Justice News

An indictment was unsealed today in Miami charging two Florida men for their roles in a scheme to defraud investors of Helios & Matheson Analytics Inc. (HMNY), a publicly traded Florida- and New York-based company that was the parent of MoviePass Inc. (MoviePass).        

According to court documents, Theodore Farnsworth, 60, of Miami, and J. Mitchell Lowe, 70, of Miami Beach, allegedly engaged in a scheme to defraud investors through materially false and misleading representations relating to HMNY and MoviePass’s business and operations to artificially inflate the price of HMNY’s stock and attract new investors. At the time of the alleged fraud, Farnsworth was HMNY’s Chairman and CEO, and Lowe was MoviePass’s CEO. 

“The Department of Justice is committed to protecting the public from being exploited by criminals for their personal profit,” said Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division. “As these charges make clear, the Department, together with our law enforcement partners, will hold corrupt C-Suite executives who engage in securities fraud accountable for their actions.”

“As alleged, the defendants deliberately and publicly engaged in a fraudulent scheme designed to falsely bolster their company’s stock price,” said Assistant Director in Charge Michael J. Driscoll of the FBI New York Field Office. “Attempted scams of this nature erode the public’s faith in our financial markets. The FBI is committed to ensuring these types of frauds and swindles are uncovered and the perpetrators are held responsible for their actions in the criminal justice system.”

The indictment alleges Farnsworth and Lowe falsely claimed that MoviePass’s $9.95 “unlimited” plan – in which new subscribers could see “unlimited” movies in theaters with no blackout dates for a flat monthly fee of $9.95 – was tested, sustainable, and would be profitable or break even on subscription fees alone. Farnsworth and Lowe allegedly knew that the $9.95 “unlimited” plan was a temporary marketing gimmick to grow new subscribers and, in turn, artificially inflate HMNY’s stock price and attract new investors. As a result, MoviePass lost money from the $9.95 “unlimited” plan.

In addition, Farnsworth and Lowe allegedly made false claims that HMNY possessed and used technologies – like “big data” and “artificial intelligence” platforms – to generate revenue by analyzing and monetizing the data MoviePass collected from subscribers. However, the indictment alleges that Farnsworth and Lowe knew HMNY did not possess these technologies or capabilities to monetize MoviePass’s subscriber data or incorporate these technologies into the MoviePass application.

Farnsworth and Lowe also allegedly made false and misleading representations about the positive impact that multiple revenue streams (other than subscription fees) were having on MoviePass’s profitability and self-sufficiency. These statements were misleading because, as the indictment alleges, Farnsworth and Lowe knew MoviePass did not have non-subscription revenue streams that would make MoviePass self-sufficient or otherwise offset the losses MoviePass experienced as a result of the unprofitable $9.95 “unlimited” plan. 

Farnsworth and Lowe are also alleged to have falsely claimed that MoviePass’s cost of goods, as reflected in the number of tickets each subscriber purchased using their subscription, was naturally declining over time consistent with their stated expectations. Behind the scenes, Farnsworth and Lowe allegedly directed MoviePass employees to implement numerous tactics to prevent certain subscribers from using the purportedly “unlimited” service for which they had paid to try to ease MoviePass’s cash shortfalls. 

Furthermore, Farnsworth and Lowe allegedly made these materially false and misleading representations in press releases, SEC filings, interviews on podcasts and on television, and in print and online media, all of which were intended to reach, and at times did in fact reach, investors and the general public throughout the United States.

Farnsworth and Lowe are each charged with one count of securities fraud and three counts of wire fraud. If convicted, they each face a maximum penalty of 20 years in prison on each count. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

The FBI New York Field Office is investigating the case.

Trial Attorney Christopher Fenton of the Criminal Division’s Fraud Section is prosecuting the case.

If you believe you are a victim in this case, please contact the Fraud Section’s Victim Witness Unit toll-free at (888) 549-3945 or by email at victimassistance.fraud@usdoj.gov. Victims can find case updates and additional information at: https://www.justice.gov/criminal-vns/case/MoviePass.

An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

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Defense News: NPS Professor Selected for ONR’s Young Investigator Program for Research Impacting Lasers at Sea

Source: United States Navy

Ortiz-Suslow was chosen from 170 candidates for his proposed research in marine atmospheric surface layer processes, which impacts the electromagnetic propagation environment for Navy systems like radar, radio and optical communications systems, and directed energy weapons. Ortiz-Suslow’s project, entitled “The Impact of Waves, Breaking, and Marine Aerosol Loading on the Marine Atmospheric Surface Layer,” was selected for investigation in the Ocean Battlespace and Expeditionary Access category, and supports the Chief of Naval Operations’ 2022 Navigation Plan (NAVPLAN) Force Design Imperative to Harden Defense for ships at sea.

“Electromagnetic systems are things like navigation technology, communications equipment, and both offensive and defensive weapons systems,” said Ortiz-Suslow. “All of these systems depend on the natural environment, and we have to understand how they interact with the environment around that asset.”

“ONR, and the Naval Research Enterprise as a whole, is committed to reimagining naval power,” said Chief of Naval Research Rear Adm. Lorin C. Selby. “In order to achieve this, we need to attract the best and brightest scientists and engineers from across academia to take on warfighting challenges. The Young Investigator Program does just that.”

According to Ortiz-Suslow, “NPS is the perfect place to conduct this research. Not only do we have the technical expertise for this research in the faculty, but we also have students who have first-hand operational experience using the equipment we are trying to make more effective.”

ONR’s Marine Meteorology and Space Weather Team Lead, Dr. Daniel Eleuterio, explained the wave-modulated atmospheric boundary layer significantly affects electromagnetic/electro-optical propagation in ways that aren’t forecast well, especially in the coastal zone.

“Professor Ortiz-Suslow has been a rising star since we first encountered his research at University of Miami. He has continued to grow as a leader in the community on National Science Foundation, ONR, and other federally sponsored projects and is a great asset for the Naval Postgraduate School faculty and students. His proposal was innovative and unanimously ranked very highly by an inter-disciplinary selection panel. I’m looking forward to seeing the results of his research,” said Eleuterio.

Ortiz-Suslow will receive a three-year grant to support his proposed research, which will ultimately advance the Navy and Marine Corps’ understanding of the operational environment and its impact on critical naval systems.

Following the award of his doctorate in applied marine science from the University of Miami, Ortiz-Suslow began his career at NPS as a postdoctoral scholar studying how waves and currents affect atmospheric turbulence. His grant through ONR’s Young Investigator Program will advance that work.

“The research I will conduct will build on studies I worked on during my post-doc,” Otriz-Suslow noted. “Aboard a research platform in southern California, we made some very interesting discoveries about how surface waves impact and modulate the lower atmosphere.”

While Ortiz-Suslow is an accomplished researcher in his field, he is looking forward to having a more active role in guiding the research, and working collaboratively with his partners, over the grant’s three years. The ONR YIP program is very selective, he added, and he is grateful to be a part of the program.

“I was ecstatic to be recognized by such a prestigious program,” said Ortiz-Suslow. “The scientists that got this award this year are really amazing, and I am incredibly honored and humbled to be included with such a fine group.”

Since 1985, the ONR Young Investigator Program has provided funding to select early career researchers whose work demonstrates “outstanding promise for supporting the Department of Defense, while also promoting their professional development.”