Month: April 2023

Source: United States Department of Justice News

EAST ST. LOUIS, Ill. – A U.S. District Court judge sentenced an East St. Louis man to 198 months after he pled guilty to several drug charges for his involvement in a national trafficking ring as the local, Metro East leader.

Jeffrey Taylor, 40, pled guilty to Conspiracy to Distribute Methamphetamine, Distribution of Cocaine, Distribution of Methamphetamine, Possession with Intent to Distribute Methamphetamine, Attempted Possession with Intent to Distribute Methamphetamine and Money Laundering. In addition to imprisonment, Taylor will serve 5 years of supervised release.

“The defendant was responsible for bringing significant quantities of illicit, destructive narcotics across state lines and into southern Illinois,” said U.S. Attorney Rachelle Aud Crowe. “This sentence demonstrates the severity of drug trafficking, and I applaud DEA’s efforts for bringing these offenders to justice.”

“This sentence concludes an investigation that perfectly represents DEA’s mission,” said Acting Assistant Special Agent in Charge Michael E. Rehg, head of Drug Enforcement Administration enforcement operations in southern Illinois. “We want the entire criminal drug organization, from the dealers to the highest level of distribution leadership, off our streets. Jeffrey Taylor and his entire network will not be putting his illegal products in our communities any longer.”

“Drug traffickers are in business to make money. IRS CI special agents have an important role in following the money and disrupting a drug trafficking organization’s ability to operate,” said Special Agent in Charge Thomas F. Murdock, St. Louis Field Office. “This sentence is a victory for communities in southern Illinois and metropolitan St. Louis. We are proud to work alongside our law enforcement partners on this important mission.”

DEA investigated the drug trafficking ring from February 2017 to August 2018 in Madison and St. Clair counties, primarily in East St. Louis. The conspiracy involved at least 240 pounds of ice methamphetamine and 48 kilograms of cocaine.

According to court documents, Taylor ran operations in the drug organization, recruited members for illegal activities and provided direction. Sixteen co-defendants were also indicted in the conspiracy to various drug charges and have been sentenced from time served and supervised release up to 262 months in federal prison. During the investigation, the defendants resided in East St. Louis, Washington Park and Wood River in Illinois as well as California, Kansas, Mississippi, Tennessee and Texas.

Agents with the Drug Enforcement Administration led the investigation with contributions from the IRS, the Illinois State Police and the U.S. Postal Inspection Service. Assistant U.S. Attorney Amanda Fischer is prosecuting the case.

This case was part of an Organized Crime Drug Enforcement Task Forces operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at www.justice.gov/OCDETF.
 

Source: United States Department of Justice News

Damian Williams, the United States Attorney for the Southern District of New York, announced today’s conviction in federal court of PAUL FISHBEIN of multiple counts of fraud and aggravated identity theft.  FISHBEIN stole hundreds of thousands of dollars from rental assistance programs administered by New York City’s Human Resources Administration (“HRA”) and New York City’s Housing Preservation & Development (“HPD,” and with HRA, the “Agencies”) by renting out properties throughout the City that he falsely claimed to own and by collecting made-up broker fees.  FISHBEIN was also convicted of Medicaid fraud.  The jury convicted FISHBEIN today following a nearly two-week trial before U.S. District Judge Paul A. Crotty.

U.S. Attorney Damian Williams said:  “New York City assists millions of low-income and vulnerable New Yorkers through different types of programs, including rental assistance programs and Medicaid.  These programs were designed to help New Yorkers in need.  But, as a jury has now found, for years, Fishbein abused those programs to enrich himself.  To do that, he told lie after lie after lie.  He stole money, including federal funds, from the City’s rental assistance programs by lying about being the landlord of homes he didn’t actually own.  He stole the identity of a real estate broker to get the City to pay him made-up broker fees.  And he stole Medicaid benefits by lying to the City about how much money he made.  Today, a unanimous jury has held Fishbein accountable for his yearslong fraudulent schemes.”

According to the Indictment, documents previously filed in the case, and the evidence introduced at trial:

From in or about 2013 through May 4, 2021, FISHBEIN rented out properties in New York City to low-income New Yorkers through the Agencies’ rental assistance programs, collecting rent payments from the Agencies as the purported owner of the properties.  In fact, FISHBEIN was never the owner of those properties and lied to the Agencies to collect the rent payments.  In addition, FISHBEIN lied to HRA that he used the services of a real estate broker to rent out certain properties in order to collect broker fee payments from HRA, also through its rental assistance program.  FISHBEIN used an actual real estate broker’s license and name without her authority to collect these made-up broker fees from the City.  In-need New Yorkers were placed in these properties, which FISHBEIN, because he was not actually the owner of the properties, failed to maintain.  In one instance, the ceiling completely collapsed while a tenant and her family were living in a property FISHBEIN claimed to own.  Through these two schemes, FISHBEIN fraudulently obtained hundreds of thousands of dollars from HRA and HPD, including more than $90,000 in federal funds. 

FISHBEIN was also convicted of healthcare fraud because, from 2014 through May 4, 2021, he lied to New York City’s Medicaid program about how much money he made in order to collect Medicaid benefits.  Medicaid is meant for low-income New Yorkers.  FISHBEIN, each year, told the City that he made only $150 a week, or $7,200 a year, when in reality, he was raking in hundreds of thousands of dollars each year from his rental assistance and broker fee schemes described above.  By lying about his income and assets, the defendant received at least approximately $49,524.80 in Medicaid benefits to which he was not entitled.

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FISHBEIN, 49, of Queens, New York, was convicted of one count of wire fraud, one count of mail fraud, one count of theft of government funds, one count of aggravated identity theft, and one count of healthcare fraud.  The wire fraud and mail fraud charges each carry a maximum sentence of 20 years in prison; the theft of government funds and healthcare fraud charges each carry a maximum sentence of 10 years in prison; and the aggravated identity theft charge carries a mandatory two-year sentence, which must run consecutive to any other prison term imposed.   

The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant would be determined by the judge.  FISHBEIN is scheduled to be sentenced by Judge Crotty on July 31, 2023.

Mr. Williams praised the outstanding investigative work of the New York City Department of Investigation.

This case is being handled by the Office’s General Crimes Unit.  Assistant U.S. Attorneys Sarah L. Kushner, Christy Slavik, and Jared Lenow are in charge of the prosecution and were assisted at trial by Paralegal Specialist Joseph Magliocco.

Source: United States Department of Justice News

           Montgomery, Alabama – On April 27, 2023, Patrick Maurio Bass, 43, from Montgomery, Alabama, received a sentence of 240 months in prison after pleading guilty to federal gun and drug charges, announced United States Attorney Sandra J. Stewart. The federal judge also ordered that Bass serve four years of supervised release following his prison term. Federal inmates are not eligible for parole.

            According to court records and statements made in open court, on August 14, 2020, the Montgomery Police Department (MPD) received information that Bass had a large quantity of illegal drugs in his possession. Later that day, MPD officers observed Bass at a Montgomery gas station, parked in a sport utility vehicle. The officers searched the vehicle. During the search, officers found significant amounts of cocaine and marijuana, along with a handgun. Bass is a convicted felon and was prohibited from possessing a firearm.

            On June 6, 2022, a federal grand jury indicted Bass for being a felon in possession of a firearm, possessing a controlled substance with intent to distribute the controlled substance, and possessing a firearm in furtherance of a drug trafficking offense. Bass pleaded guilty to these charges on December 19, 2022.

            MPD and the Bureau of Alcohol, Tobacco, Firearms and Explosives investigated this case, with assistance from the Montgomery County Sheriff’s Office. Assistant United States Attorney Joshua J. Wendell prosecuted the case.

Source: United States Department of Justice News

A Texas woman was sentenced today to 27 months in prison for willfully assisting clients in the preparation and filing of false tax returns with the IRS.

According to court documents, between 2014 and 2017, Adela Cruz operated a business in Uvalde County preparing tax returns.  To inflate her clients’ refunds, Cruz claimed on those returns false education credits, dependents, and business profits or losses. Cruz did not sign these false returns as the preparer, but rather concealed her involvement by using fictitious taxpayer emails. Cruz also claimed false education credits on her own tax returns for 2015 and 2016.

In addition to the term of imprisonment, U.S. District Judge David Counts ordered Cruz to serve one year of supervised release and to pay a $1,500 fine and $129,239 in restitution to the United States.

Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and U.S. Attorney Jaime E. Esparza for the Western District of Texas made the announcement.

IRS-Criminal Investigation investigated the case.

Trial Attorneys Robert A. Kemins and Nicholas J. Schilling, Jr., of the Justice Department’s Tax Division are prosecuted the case.

Source: United States Department of Justice News

An Ohio man was sentenced today to four years and three months in prison for stealing over 712 bitcoin that were the proceeds of the darknet bitcoin mixer Helix and subject to forfeiture in a then-pending criminal case.

According to court documents, Gary James Harmon, 31, of Cleveland, perpetrated a scheme to steal cryptocurrency that was the subject of pending criminal forfeiture proceedings in the case of Larry Dean Harmon, Gary Harmon’s brother. In February 2020, Larry Harmon was arrested for his operation of Helix, a darknet-based cryptocurrency money laundering service, known as a “mixer” or “tumbler.” Helix laundered over 350,000 bitcoin – valued at over $300 million at the time of the transactions – on behalf of customers, with the largest volume coming from darknet markets. Law enforcement seized various assets, including a cryptocurrency storage device containing Larry Harmon’s illegal proceeds generated through the operation of Helix, which were subject to forfeiture in the criminal case. However, law enforcement was initially unable to recover bitcoin stored on the device due to the device’s additional security features. 

Knowing that the government was seeking to recover the bitcoin stored on the seized device for forfeiture in Larry Harmon’s criminal case, Gary Harmon used his brother’s credentials to recreate the bitcoin wallets stored on the device and covertly transfer more than 712 bitcoin, valued at approximately $4.8 million at the time, to his own wallets – stealing those funds and obstructing the pending criminal forfeiture proceeding. Gary Harmon further laundered the proceeds through two online bitcoin mixer services before using the laundered bitcoins to finance large purchases and other expenditures. 

Gary Harmon agreed to the forfeiture of cryptocurrencies and other properties derived from the fraudulently taken proceeds, including more than 647.41 Bitcoin (BTC), 2.14 Ethereum (ETH), and 17,404,400.64 Dogecoin (DOGE). Due to the increase in market prices, the total value of these forfeitable properties exceeds $20 million. 

In August 2021, Larry Harmon pleaded guilty to money laundering conspiracy in connection with his case.

Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division, U.S. Attorney Matthew M. Graves for the District of Columbia, Assistant Director Bryan Vorndran of the FBI’s Cyber Division, Special Agent in Charge David Sundberg of the FBI Washington Field Office, and Acting Special Agent in Charge Kareem A. Carter of the IRS Criminal Investigation (IRS-CI) Washington, D.C. Field Office made the announcement.

The FBI and the IRS-CI District of Columbia Cyber Crime Unit investigated the case.

Assistant U.S. Attorney Christopher B. Brown for the District of Columbia and Trial Attorney C. Alden Pelker of the Criminal Division’s Computer Crime and Intellectual Property Section (CCIPS), both now also members of the National Cryptocurrency Enforcement Team, prosecuted the case, with assistance from Paralegal Specialists Michon Tart, Angela De Falco, and Brian Rickers, and former Paralegal Specialist Chad Byron. Additional assistance was provided by Assistant U.S. Attorneys Segev Phillips and Daniel Riedl for the Northern District of Ohio and CCIPS Trial Attorney S. Riane Harper.