Month: February 2023

Source: United States Department of Justice News

BISMARCK – United States Attorney Mac Schneider announced that on February 23, 2023, U.S. District Court Judge Daniel M. Traynor sentenced Kolawole Bamidele Akande, age 37, from Nigeria, to serve 30 months in federal prison and ordered to pay $348,000 in restitution for committing the offense of Mail Fraud against a company located in Dickinson, North Dakota.  On September 5, 2021, the defendant was arrested in the United Kingdom on this charge.  Thereafter, on April 9, 2022, Akande was extradited from the United Kingdom to the District of North Dakota.  On November 8, 2022, the defendant pleaded guilty to Mail Fraud.

While living in Dallas, Texas, Akande, as well as other codefendants, fraudulently obtained checks from a Dickinson, North Dakota, company through the mail and deposited these checks in fraudulent accounts at financial institutions located within the State of Texas. The Dickinson company was the victim of a computer intrusion scam that tricked the company’s controller into issuing checks totaling $348,000, which were deposited by Akande and codefendant Olawale Sule. This computer intrusion scheme caused the Dickinson company to sustain a loss of $298,000.

As part of this scheme to defraud, in November 2018, Akande used a fraudulent United Kingdom passport containing the fictitious name “Patric Elis Ferguson” to open a bank account at a Dallas, Texas, branch of Bank of America.  On March 27, 2019, the controller of the Dickinson company received emails appearing to come from the company’s principal owners. The emails instructed the controller to mail a $192,000 check to an address in Dallas, Texas, payable to “Patel Retail and Logistics.” The controller sent, via overnight United Parcel Service (UPS) mail, the $192,000 check to the Dallas, Texas, address requested in the email. On March 28, 2019, Akande deposited the $192,000 check made payable to “Patel Retail and Logistics” into the Bank of America account that he had opened utilizing the fictitious name of “Patric Elis Ferguson.” Shortly thereafter, Akande either withdrew or transferred the funds to conceal and disguise their nature, location, source, and ownership.

Law enforcement conducted an investigation, which revealed that the Dickinson company was a victim of computer intrusion. Specifically, an unknown individual obtained access to the company’s principal owners’ Outlook 365 email accounts and sent the emails to the company’s controller directing the controller to mail the check to “Patel Retail and Logistics.”

The United States District Court for the District of North Dakota previously sentenced:

• Co-Defendant Olawale Sule a/k/a Brand King Mohammed, a/k/a John Thomas, on February 17, 2021, to serve two years’ imprisonment and payment of restitution on a charge of Conspiracy to Commit Bank Fraud.

• Co-Defendant Oluwafemi Elijah Olasode, on September 7, 2021, to time served imprisonment and payment of restitution on a charge of Misprision of Felony.

“Too often, swindlers believe they can evade justice because they are behind a computer or operating internationally,” Schneider said. “This sentence shows they should think again. This outcome is a credit to the skilled law enforcement investigators and prosecutors who patiently saw this case through.”

Link for Prior Press Release Unsealing the Indictment and Announcing Akande’s extradition from the United Kingdom to the United States are located below:

https://www.justice.gov/usao-nd/pr/federal-grand-jury-indicts-nigerian-nationals-multiple-fraud-schemes-against-dickinson-nd

https://www.justice.gov/usao-nd/pr/nigerian-man-extradited-united-states-united-kingdom-face-multiple-fraud-and-money

This case was investigated by the Federal Bureau of Investigation; United States Postal Inspection Service; Homeland Security Investigations; United States Attorney’s Office in the Northern District and Eastern District of Texas; and by the Office of International Affairs, Department of Justice, assisting with securing the extradition.

Assistant U.S. Attorney Jonathan J. O’Konek prosecuted this case.

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Source: United States Department of Justice News

            WASHINGTON – The U.S. Attorney’s Office for the District of Columbia announced today that there is insufficient evidence to pursue federal criminal civil rights or District of Columbia charges against a commander from the Metropolitan Police Department who was involved in the July 2022 fatal shooting of Lazarus Wilson, outside a restaurant in the Wharf neighborhood in Southwest Washington, D.C.

            The U.S. Attorney’s Office and the MPD Internal Affairs Division conducted a comprehensive review of the incident, which included a review of law enforcement and civilian eyewitness accounts, surveillance video, BWC footage, physical evidence, recorded radio communications, forensic reports, the autopsy report, and reports from the Metropolitan Police Department.

            According to the evidence, after 9 p.m. on Saturday, July 16, 2022, MPD Commander Jason Bagshaw of the Special Operations Division was dining with his wife, an MPD investigator, at a restaurant located in the Wharf neighborhood in Southwest D.C. Although Commander Bagshaw was off duty, he was equipped with his Glock 17 service pistol. Commander Bagshaw and his wife observed a commotion from the area of the restaurant facing Wharf Street SW and the Potomac River. Patrons and employees of the restaurant began crouching down and crawling away. Commander Bagshaw and his wife walked towards the direction of the commotion.

            When Commander Bagshaw and his wife exited the restaurant, they observed Lazarus Wilson pointing a firearm at another individual in what appeared to be a robbery attempt. The firearm was later recovered at the scene. A friend of Mr. Wilson was also present on the scene. Commander Bagshaw retrieved his Glock 17 service pistol from its holster, pointed it in the direction of Mr. Wilson and stated, “MPD, drop the gun!” However, Mr. Wilson did not comply, and Commander Bagshaw discharged one round striking Mr. Wilson in the left cheek. Mr. Wilson was transported by DCFEMS to George Washington University Hospital, where he was pronounced dead later that evening.

            After a careful, thorough, and independent review of the evidence, federal prosecutors found insufficient evidence to prove beyond a reasonable doubt that Commander Bagshaw used excessive force under the circumstances.

Use-of-force investigations generally

            The U.S. Attorney’s Office reviews all police-involved fatalities to determine whether sufficient evidence exists to conclude that any officers violated either federal criminal civil rights laws or District of Columbia law.  To prove civil rights violations, prosecutors must typically be able to prove that the involved officers willfully used more force than was reasonably necessary.  Proving “willfulness” is a heavy burden.  Prosecutors must not only prove that the force used was excessive, but must also prove, beyond a reasonable doubt, that the officer acted with the deliberate and specific intent to do something the law forbids. 

            The U.S. Attorney’s Office remains committed to investigating allegations of excessive force by law enforcement officers and will continue to devote the resources necessary to ensure that all allegations of serious civil rights violations are investigated fully and completely. The Metropolitan Police Department’s Internal Affairs Division investigates all police-involved fatalities in the District of Columbia.

Source: United States Department of Justice News

An indictment was unsealed this morning in federal court in Brooklyn charging OZY Media Inc. (Ozy), a media and entertainment company headquartered in Mountain View, California, and its founder and Chief Executive Officer, Carlos Watson, with conspiracy to commit securities fraud and conspiracy to commit wire fraud in connection with a scheme to defraud Ozy’s investors and lenders by making material misrepresentations about Ozy’s financial and business assets.  Watson is also charged with aggravated identity theft for his role in the impersonation of multiple media company executives in communications with Ozy’s lenders and prospective investors in furtherance of the fraud schemes.  

Watson was arrested this morning and will be arraigned later today before United States Magistrate Judge Cheryl L. Pollak.  If convicted, Watson faces a mandatory minimum sentence of two years’ imprisonment and a maximum sentence of 37 years’ imprisonment.

Watson’s co-conspirators Samir Rao, Ozy’s Chief Operating Officer, and Suzee Han, Ozy’s Chief of Staff from June 2019 to October 2021, previously pleaded guilty to charges relating to their roles in the scheme.  The U.S. Securities and Exchange Commission (SEC) is taking concurrent enforcement action. 

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 arrest and indictment.

“As alleged, Carlos Watson is a con man whose business strategy was based on outright deceit and fraud – he ran Ozy as a criminal organization rather than as a reputable media company,” stated United States Attorney Peace.  “Investment fraud undermines confidence in our nation’s markets and investors and makes it harder for honest businesses to compete.  Our Office and the Department of Justice have made it clear that prosecuting corporations and their corrupt executives who flagrantly violate the law are top priorities.”

“As the indictment today alleges, Watson repeatedly attempted to entice both investors and lenders through a series of deliberate deceptions and fabrications.  The FBI and our partners in law enforcement will hold any individual willing to defraud investors and financial institutions accountable in the criminal justice system,” stated Assistant Director-in-Charge Driscoll.

The Scheme

As alleged in the indictment and court documents, Ozy is a media and entertainment company whose businesses include digital newsletters, television production, podcasts, and live events, the most prominent of which is a live festival known as “Ozy Fest.”  Watson founded Ozy in 2012 and has served as the company’s Chief Executive Officer since its inception.

Between approximately 2018 and 2021, Watson and his co-conspirators, including Rao and Han, orchestrated a scheme to defraud investors in and lenders to Ozy of tens of millions of dollars through fraudulent misrepresentations and omissions about key aspects of Ozy’s business, including Ozy’s financial results, debts, and audience size.  In addition, Watson and his co-conspirators lied to prospective investors about who else might be investing in Ozy, the existence and size of acquisition offers received by Ozy, the existence and timing of “Series C” and “Series D” financing rounds by Ozy, and the existence and terms of Ozy’s business contracts — going so far as to direct Ozy employees to create fake contracts with forged signatures to provide in due diligence.  On multiple occasions, when faced with questions from lenders or potential investors, Watson and his co-conspirators assumed the identities of and impersonated actual media company executives to cover up their prior fraudulent misrepresentations. 

Forged Cable Television Contract and Impersonation of Media Executive

In December 2019, Watson and his co-conspirators attempted to induce a bank to lend Ozy money based on misrepresentations and omissions about Ozy’s business.  Watson and his co-conspirators sought to secure the loan with anticipated revenues from a second season of an Ozy television show.  However, the contract between Ozy and the show’s cable network for the second season of the show was still under negotiation.  To induce the bank to make the loan sooner, Watson directed Ozy’s then-Chief Financial Officer (CFO) to send the bank a fake signed contract between Ozy and the cable network purporting to be for the second season.  When the then-CFO refused, Rao, with Watson’s approval, sent the fake contract — which contained terms favorable to Ozy and a forged signature — to the bank, copying the then-CFO.  Later that day, the then-CFO emailed Watson and Rao to say that she was resigning effective immediately.  She explained, “this . . . is illegal.  This is fraud.  This is forging someone’s signature with the intent of getting an advance from a publicly traded bank.”  She continued, “To be crystal clear, what you see as a measured risk — I see as a felony.”

In subsequent months, Watson and his co-conspirators continued to attempt to induce the bank to lend Ozy several million dollars based on misrepresentations and omissions, including regarding the expected revenue from the second season of the Ozy television show.  During these discussions, the bank requested to speak to a representative of the cable network.  To conceal the lies about Ozy’s relationship with the cable network and the status and terms of their agreement, Rao, with Watson’s approval, created a fake email address in the name of an actual executive of the cable network, which Rao used to impersonate the executive and communicate with the bank about the potential loan.

Attempted Fraudulent Investment and Impersonation of Another Media Executive

From approximately November 2020 through February 2021, Watson and his co-conspirators attempted to induce a financial institution to invest up to $45 million in Ozy by means of material misrepresentations and omissions regarding Ozy’s historical and projected financial results, debts, and business relationships.  Had the full $45 million investment occurred as intended, $6 million of the $45 million would have been paid to Watson personally. 

As part of its due diligence process, the financial institution asked Watson and Rao to arrange a meeting with someone from a well-known online video service that Watson and his co-conspirators claimed had paid Ozy nearly $6 million in licensing revenue for “The Carlos Watson Show.”  This was another misrepresentation — Ozy was never paid by this online video service for Ozy content.  Because Ozy did not in fact have any business relationship with the online video service, Watson and Rao agreed that Rao would impersonate a media executive at the online video service in communications with the financial institution.  On or about January 28, 2021, Rao, with Watson’s agreement, created a fake email address in the name of the media executive, which he used to correspond with representatives of the financial institution.

On or about February 2, 2021, Rao had a call with employees of the financial institution during which he impersonated a media executive from the online video service using a voice alteration application that he downloaded onto his cellular telephone to mask his voice during the call.  During the call, Watson was in the same room as Rao, and texted Rao instructions about what to say and what not to say on the call.  Shortly after the call, one of the employees of the financial institution contacted the actual media executive of the online video service, who confirmed that he had not been on the call and that the online video service had no role in the production of The Carlos Watson Show.  When members of the financial institution later spoke with Watson, he falsely claimed that Rao had acted alone and as a result of a mental breakdown.

The charges in the indictment are allegations, and the defendants are presumed innocent unless and until proven guilty.

The government’s case is being handled by the Office’s Business and Securities Fraud Section.  Assistant United States Attorneys Jonathan Siegel, Dylan A. Stern, and Gillian Kassner are in charge of the prosecution, with assistance from Paralegal Specialist Jake Menz.

The Defendants:

CARLOS WATSON
Age:  53
Mountain View, California

OZY MEDIA, INC.
Mountain View, California

E.D.N.Y. Docket No. 23-CR-82 (EK)

Source: United States Department of Justice News

Des Moines, IA – A Nevada, Iowa man was sentenced today to 121 months in prison following his guilty plea for possession of child pornography.

According to court documents, on or about December 21, 2021, William Ryan Buttermore, age 24, knowingly possessed visual depictions of child pornography, including 44 images and four videos, some of which depicted infants and other minors younger than 12 years old. Buttermore downloaded the material from the internet. In addition, Buttermore used an account on Kik Messenger to transport child pornography to others and to encourage others to produce child pornography and engage in sex acts with children. Following his prison term, Buttermore must also serve a ten-year term of supervised release. There is no parole in the federal system.

United States Attorney Richard D. Westphal of the Southern District of Iowa made the announcement. The Story County Sheriff’s Department, in conjunction with the Iowa Crimes Against Children Task Force, investigated the case. Assistant United States Attorney Kyle Essley prosecuted the case.

The case was brought as part of Project Safe Childhood. In 2006, the Department of Justice created Project Safe Childhood, a nationwide initiative designed to protect children from exploitation and abuse. Led by the U.S. Attorney’s Offices and the Department of Justice’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who exploit children, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.