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Tuesday, November 30, 2010

Fraudulent Notification Deceives Consumers Out of Thousands of Dollars

11/29/2010—The IC3 continues to receive reports of letters and e-mails being distributed pursuant to prize sweepstakes or lottery schemes. These schemes use counterfeit checks that bear legitimate-looking logos of various financial institutions to fool victims into sending money to the fraudsters.
 
Fraudsters tell victims they won a sweepstakes or lottery, but to receive a lump sum payout, they must pay the taxes and processing fees upfront. Fraudsters direct individuals to call a telephone number to initiate a letter of instructions. The letter alleges that the victim may elect to take an advance on the winnings to make the required upfront payment. The letter includes a check in the amount of the alleged taxes and fees, along with processing instructions. Ultimately, victims believe they are using the advance to make the required upfront payment, but in reality they are falling prey to the scheme.

The victim deposits the check into their own bank, which credits the account for the amount of the check before the check clears. The victim immediately withdraws the money and wires it to the fraudsters. Afterwards, the check proves to be counterfeit and the bank pulls the respective funds from the victim’s account, leaving the victim liable for the amount of the counterfeit check plus any additional fees the bank may charge.

Persons may fall victim to this scheme due to the allure of easy money and the apparent legitimacy of the check the fraudsters include in the letter of instruction. The alleged cash prizes and locations of the financial institutions vary.

Tips to avoid being scammed:

-A federal statute prohibits mailing lottery tickets, advertisements, or payments to purchase tickets in a foreign lottery.
-Be leery if you do not remember entering a lottery or sweepstakes.
-Beware of lotteries or sweepstakes that charge a fee prior to delivering your prize.
-Be wary of demands to send additional money as a requirement to be eligible for future winnings.

If you have been a victim of this type of scam or any other cyber crime, you can report it to the IC3 at www.IC3.gov. The IC3 complaint database links complaints for potential referral to law enforcement for case consideration. Complaint information is also used to identify emerging trends and patterns to alert the public to new criminal schemes.

FBI and San Diego Police Department Seek Public’s Assistance to Identify California Bank and Trust Robber

The FBI and San Diego Police Department are seeking the public’s assistance to identify the unknown male responsible for robbing a California Bank & Trust bank today.

On Monday, November 29, 2010, at approximately , a white male robbed the California Bank & Trust bank in La Jolla, California. The robber entered the bank, approached the victim teller, and produced a note demanding cash and threatening a gun. No weapon was observed, however, and no one was injured.

The robber is described as follows:

Race: White
Age: 70s
Height: Approximately 6’0”
Weight: Approximately 200 pounds
Build: Medium
Other: Wrinkled face with sun spots
Clothing: Floppy hat, tan gloves, possibly wearing a mask.

Anyone with information concerning this robbery is asked to contact the FBI at telephone number (858) 565-1255, San Diego Police Department Robbery Unit at (619) 531-2299 or CrimeStoppers at (888) 580-8477.

ICE seizes 82 website domains involved in selling counterfeit goods as part of Cyber Monday crackdown

WASHINGTON - Seizure orders have been executed against 82 domain names of commercial websites engaged in the illegal sale and distribution of counterfeit goods and copyrighted works as part of Operation In Our Sites v. 2.0, as part of an ongoing investigation by U.S. Immigration and Customs Enforcement (ICE).

"The sale of counterfeit U.S. brands on the Internet steals the creative work of others, costs our economy jobs and revenue and can threaten the health and safety of American consumers," said ICE Director John Morton. "The protection of intellectual property is a top priority for Homeland Security Investigations and the National Intellectual Property Rights Coordination Center. We are dedicated to protecting the jobs, the income and the tax revenue that disappear when counterfeit goods are trafficked."

The coordinated federal law enforcement operation targeted online retailers of a diverse array of counterfeit goods, including sports equipment, shoes, handbags, athletic apparel and sunglasses as well as illegal copies of copyrighted DVD boxed sets, music and software.

During the course of the operation, federal law enforcement agents made undercover purchases from online retailers suspected of selling counterfeit goods. In many instances, the goods were shipped directly into the United States from suppliers in other countries using international express mail. If the goods were confirmed as counterfeit or otherwise illegal, seizure orders for the domain names of the websites that sold the goods were obtained from U.S. magistrate judges. Individuals attempting to access the websites will now find a banner notifying them that the domain name of that website has been seized by federal authorities.

"By seizing these domain names, we have disrupted the sale of thousands of counterfeit items, while also cutting off funds to those willing to exploit the ingenuity of others for their own personal gain," said Attorney General Eric Holder. "Intellectual property crimes are not victimless. The theft of ideas and the sale of counterfeit goods threaten economic opportunities and financial stability, suppress innovation and destroy jobs. The Justice Department, with the help of our law enforcement partners, is changing the perception that these crimes are risk-free with enforcement actions like the one announced today."

The operation builds upon Operation in Our Sites I, which was announced in June 2010. In that first action of this broader law enforcement initiative, authorities executed seizure warrants against nine domain names of websites offering pirated copies of first-run movies.

The nationwide operation was spearheaded by the National Intellectual Property Rights Coordination Center (IPR Center) led by ICE’s Office of Homeland Security Investigations (HSI), in coordination with the Criminal Division’s Computer Crime and Intellectual Property Section and nine U.S. Attorneys’ Offices including the Southern District of New York; District of Columbia; Middle District of Florida; District of Colorado; Southern District of Texas; Central District of California; Northern District of Ohio; District of New Jersey; and the Western District of Washington. The Criminal Division’s Asset Forfeiture and Money Laundering Section also provided significant assistance.

The IPR Center is one of the U.S. government’s key weapons in the fight against criminal counterfeiting and piracy. The IPR Center is led by ICE HSI and includes partners from U.S. Customs and Border Protection; the FBI; the Department of Commerce; the Food and Drug Administration; the Postal Inspection Service; the General Services Administration, Office of the Inspector General; the Naval Criminal Investigative Service; the Defense Criminal Investigative Service; the Army Criminal Investigative Division’s Major Procurement Fraud Unit; the Consumer Product Safety Commission, INTERPOL; and the Government of Mexico Tax Administrative Service. The IPR Center allows law enforcement and the private sector jointly to address the growing transnational problem of counterfeit products. The IPR Center coordinates outreach to U.S. rights holders and conducts domestic and international law enforcement as well as coordinates and directs anti-counterfeiting investigations. To learn more about the IPR Center, visit http://www.ice.gov.

FBI Investigates Possible Link in Three Bank Robberies

The FBI is investigating whether three First Community Bank robberies in the Albuquerque area are related.

A preliminary investigation suggests the robberies that occurred Oct. 12 at
8251 Golf Course Road NW, Albuquerque
; Nov. 18 at
1418 Carlisle Boulevard NE, Albuquerque
; and Wednesday at
1000 Commercial Drive
, Rio Rancho, may have been committed by one or both of the same suspects.

On Oct. 12 at about , a man wearing a Scream mask displayed a handgun and demanded money. The suspect was described as white or Hispanic, about 5'8 tall, with a medium to heavy build. He wore a black hood, blue sweatshirt, and black pants.

On Nov. 18 at about 2:20 p.m., two armed men—one wearing a Scream mask and the other a skull mask—ordered tellers to the ground and then into a bathroom.

The man who wore the Scream mask was described as about 5'10 to 6' tall; the other was about 5'8 to 5'9. Both were dressed in black and were described as white or Hispanic.

They were seen driving away in a white pickup truck headed east on
Constitution Avenue
.

On Wednesday at about , a man wearing a tan bandana over his face, black gloves, and a blue coat with a hood, showed a handgun to a teller and demanded money. He was described as about 5'10 to 6', with a medium build.

Nobody was injured in these robberies.

The FBI also is investigating whether the suspects may have been involved in other bank robberies.

A reward of up to $1,000 may be available for information leading to the arrest and conviction of the subject(s). Anyone with information is asked to call the Albuquerque FBI Office at (505) 889-1300 (24 hours), Albuquerque Police Crime Stoppers at 843-STOP, or Rio Rancho Police Department at (505) 891-5900.

FBI Offers $10,000 Reward in Attack on Corvallis Mosque

FBI agents are investigating an apparent attack on the Salman Al-Farisi Islamic Center in Corvallis. The fire appears to have started sometime after . There was fire and smoke damage to the office of the Islamic Center. The center is located at
610 NW Kings Boulevard
in Corvallis. The FBI is offering a reward of up to $10,000 for information leading to the identification, arrest, and conviction of the person or people responsible.

"We have made it quite clear that the FBI will not tolerate any kind of retribution or attack on the Muslim community," said Arthur Balizan, Special Agent in Charge of the FBI in Oregon. "We are working very closely with the leadership at the mosque. We will find the person responsible for this attack and bring the full force of the federal justice system to bear. In the meantime, the FBI remains absolutely committed to protecting each and every American's right to live, work, and worship in a free and safe society."

A tipline has been established as (541) 766-6506. If no one picks up immediately, leave a message. As an alternate, you can call the FBI's 24-hour number at (503) 224-4181. Tips can also be e-mailed to portland@ic.fbi.gov.

The FBI has partnered with the Corvallis Police Department, Corvallis Fire Department, and ATF to investigate this case. The investigation is ongoing, and there is no information to release concerning possible motives or suspects at this time.

Monday, November 29, 2010

Focus on Fire Safety: Holiday Fire Safety

The delicious deep-fried turkey has quickly grown in popularity but safety experts are concerned that backyard chefs may be sacrificing fire safety for good taste.

Here’s why using a deep-fryer can be dangerous:
Decorating homes and businesses is a long-standing tradition around the holiday season. Unfortunately, these same decorations may increase your chances of fire. Based on data from the National Fire Protection Association (NFPA) and the U.S. Fire Administration (USFA), an estimated 250 home fires involving Christmas trees and another 170 home fires involving holiday lights and other decorative lighting occur each year. Together, these fires resulted in 21 deaths and 43 injuries.

Following a few simple fire safety tips can keep electric lights, candles, and the ever popular Christmas tree from creating a tragedy. Learn how to prevent a fire and what to do in case a fire starts in your home. Make sure all exits are accessible and not blocked by decorations or trees. Help ensure that you have a fire safe holiday season.

Christmas Tree Retailers
Order the free USFA Christmas Tree Fire Safety Hang Tag to remind your customers how to care for a live tree in their homes.

Christmas Trees
What’s a traditional Christmas morning scene without a beautifully decorated tree? If your household includes a natural tree in its festivities, take to heart the sales person’s suggestion – “Keep the tree watered.”

Christmas trees account for hundreds of fires annually. Typically, shorts in electrical lights or open flames from candles, lighters or matches start tree fires. Well-watered trees are not a problem. A dry and neglected tree can be.

Selecting a Tree for the Holidays
Needles on fresh trees should be green and hard to pull back from the branches, and the needles should not break if the tree has been freshly cut. The trunk should be sticky to the touch. Old trees can be identified by bouncing the tree trunk on the ground. If many needles fall off, the tree has been cut too long and, has probably dried out, and is a fire hazard.

Caring for Your Tree
Do not place your tree close to a heat source, including a fireplace or heat vent. The heat will dry out the tree, causing it to be more easily ignited by heat, flame or sparks. Be careful not to drop or flick cigarette ashes near a tree. Do not put your live tree up too early or leave it up for longer than two weeks. Keep the tree stand filled with water at all times.

Disposing of Your Tree
Never put tree branches or needles in a fireplace or wood-burning stove. When the tree becomes dry, discard it promptly. The best way to dispose of your tree is by taking it to a recycling center or having it hauled away by a community pick-up service.

Holiday Lights
Maintain Your Holiday Lights
Inspect holiday lights each year for frayed wires, bare spots, gaps in the insulation, broken or cracked sockets, and excessive kinking or wear before putting them up. Use only lighting listed by an approved testing laboratory.

Do Not Overload Electrical Outlets
Do not link more than three light strands, unless the directions indicate it is safe. Connect strings of lights to an extension cord before plugging the cord into the outlet. Make sure to periodically check the wires – they should not be warm to the touch.

Do not leave holiday lights on unattended!

Holiday Decorations
Use Only Nonflammable Decorations
All decorations should be nonflammable or flame-retardant and placed away from heat vents. If you are using a metallic or artificial tree, make sure it is flame retardant.

Don't Block Exits
Ensure that trees and other holiday decorations do not block an exit way. In the event of a fire, time is of the essence. A blocked entry/exit way puts you and your family at risk.

Never Put Wrapping Paper in the Fireplace
Wrapping paper in the fireplace can result in a very large fire, throwing off dangerous sparks and embers that may result in a chimney fire.

Candle Care
Avoid Using Lit Candles
If you do use lit candles, make sure they are in stable holders and place them where they cannot be easily knocked down. Never leave the house with candles burning.

Never Put Lit Candles on a Tree
Do not go near a Christmas tree with an open flame – candles, lighters or matches.

As in every season, have working smoke alarms installed on every level of your home, test them monthly and keep them clean and equipped with fresh batteries at all times. Know when and how to call for help. And remember to practice your home escape plan!

Sunday, November 28, 2010

Discovery of 2nd major San Diego-area cross-border drug tunnel leads to 8 arrests, seizure of more than 20 tons of marijuana

SAN DIEGO - Eight suspects are in custody on both sides of the U.S.-Mexico border and more than 20 tons of marijuana have been seized following the San Diego Tunnel Task Force's discovery Thursday of a cross-border passageway even more sophisticated than a similar tunnel uncovered in the area less than three weeks ago.

Unlike previous area tunnels, the nearly half-mile long passageway had two U.S. entrances located in warehouses about 800 feet apart in the Otay Mesa industrial complex in southern San Diego. The tunnel, which reached an estimated depth of 90 feet, emerged in Tijuana, Mexico, inside a stucco residence outfitted with a garage large enough to accommodate deliveries by tractor trailer trucks. Inside, the tunnel's walls were fortified with wood and cinderblock supports and the passageway was equipped with advanced rail, electrical and ventilation systems.

The tunnel discovery is the result of an ongoing investigation by the multi-agency San Diego Tunnel Task Force, including U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI), U.S. Customs and Border Protection (CBP) Border Patrol and the Drug Enforcement Administration (DEA). Formed seven years ago, the task force uses a variety of techniques to detect cross-border tunnels, from state-of-the-art electronic surveillance to old fashioned detective work.

The tunnel was located Thursday morning after task force agents conducting surveillance in the Otay Mesa area observed suspicious activity involving a tractor trailer truck parked at a warehouse in the 10000 block of Marconi Drive where one of the tunnel's entrances was later found. After the truck left the site, agents kept it under surveillance, alerting CBP Border Patrol as it approached the traffic checkpoint in Temecula. There, Border Patrol agents stopped the vehicle and a search of the truck's trailer revealed more than 27,600 pounds of marijuana. The vehicle's driver was taken into custody and will be prosecuted on federal drug smuggling charges.

The tunnel was located Thursday morning after task force agents conducting surveillance in the Otay Mesa area observed suspicious activity involving a tractor trailer truck parked at a warehouse in the 10000 block of Marconi Drive where one of the tunnel's entrances was later found. After the truck left the site, agents kept it under surveillance, alerting CBP Border Patrol as it approached the traffic checkpoint in Temecula. There, Border Patrol agents stopped the vehicle and a search of the truck's trailer revealed more than 27,600 pounds of marijuana. The vehicle's driver was taken into custody and will be prosecuted on federal drug smuggling charges. The tunnel was located Thursday morning after task force agents conducting surveillance in the Otay Mesa area observed suspicious activity involving a tractor trailer truck parked at a warehouse in the 10000 block of Marconi Drive where one of the tunnel's entrances was later found. After the truck left the site, agents kept it under surveillance, alerting CBP Border Patrol as it approached the traffic checkpoint in Temecula. There, Border Patrol agents stopped the vehicle and a search of the truck's trailer revealed more than 27,600 pounds of marijuana. The vehicle's driver was taken into custody and will be prosecuted on federal drug smuggling charges.

“This discovery again shows the cartels' growing desperation in the face of beefed up border security and the costly extremes these organizations are trying in an effort to avoid detection,” said Miguel Unzueta, special agent in charge for ICE Homeland Security Investigations in San Diego. “Once again, we've thwarted their scheme and I predict you'll see more such successes in the future as the Task Force ramps up its outreach to businesses in the Otay Mesa area. While we have a vast array of high-tech equipment at our disposal, public tips play a huge part in our ongoing enforcement efforts.”

As the case began unfolding here, task force agents contacted the Mexican military with several leads and a search Thursday afternoon at a ranch in northern Mexico yielded another four tons of marijuana. Finally, after entering the tunnel itself, investigators recovered more than 6,000 additional pounds of pot inside.

“The discovery of this tunnel is the result of law enforcement's tenacity and willingness to work together to combat the latest method of drug smuggling by drug trafficking organizations,” said Ralph Partridge, special agent in charge for the DEA in San Diego. “The magnitude of this discovery can only be compared to the measure of disruption its discovery will have on drug traffickers.”

So far, eight suspects have been taken into custody in connection with the ongoing investigation. In addition to the truck driver intercepted at the Temecula checkpoint, task force agents arrested two men in El Cajon, Calif., who were observed at the Otay Mesa warehouse Thursday morning. The five remaining arrests were made by authorities in Mexico.

“Our border security mission continues to evolve as new vulnerabilities and threats persist,” said Paul Beeson, chief patrol agent for the San Diego Border Patrol sector. “I am confident that our collaborative law enforcement efforts on both sides of the border, specifically the efforts of Mexican military, will allow us to adapt and defeat these threats. Yesterday's discovery is a true indicator that intelligence and operational collaboration within the law enforcement community is essential for effective border security.”

Authorities emphasize that their investigation into this latest tunnel is ongoing. In the last four years, federal authorities have detected more than 75 cross-border smuggling tunnels, most of them in California and Arizona.

Firefighter Fatality

The United States Fire Administration (USFA) has received notice of the following firefighter fatality:

Name: Kenneth Marshall, Jr.
Rank:  Firefighter
Age:  33
Gender:  Male
Status:  Paid-on-Call
Years of Service: 15
Date of Incident: 11/25/2010
Time of Incident: 2130hrs
Date of Death: 11/25/2010

Fire Department: Rehoboth Fire Department
Address:
334 Anawan ST, Rehoboth, MA 02769
Fire Department Chief: Robert F. Pray
Fire Department POC: Deputy Chief John Parker, Jr.

Incident Description:  Firefighter Kenneth Marshall Jr., was driving Engine Company 2 en route to a residential fire when members of his department in the apparatus noticed that he was in distress. The members immediately stopped Engine 2 and performed CPR.  Firefighter Marshall was rushed by Rehoboth Ambulance to the hospital where he was pronounced dead shortly after his arrival.

Funeral Arrangements: Pending
Memorial Fund Contact and Address:  Pending
Tribute is being paid to Firefighter Kenneth Marshall, Jr. at http://www.usfa.dhs.gov/fireservice/fatalities/

To date, 80 firefighter fatalities have been reported to USFA in 2010; 78 from incidents that occurred in 2010 and 2 from previous year incidents.  Year-to-date monthly and annual USFA firefighter fatality reports are posted online @ http://www.usfa.dhs.gov/fireservice/fatalities/statistics/ff_stats.shtm.

Friday, November 26, 2010

Westlake Attorney Arrested in Connection with Ongoing Cuyahoga County Public Corruption Investigation

William Mitchell, Jr. was arrested this morning following the unsealing of a three-count indictment in connection with the ongoing Cuyahoga County public corruption investigation, said Bernard A. Smith, Appellate Chief, Criminal Division in the Northern District of Ohio; Harold Bickmore, Acting Special Agent in Charge of the Cleveland Division of the FBI, and Jose A. Gonzalez, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation Division.

Mitchell, 61, lives in Westlake, Ohio, according to court documents.

He is accused of taking part in a bribery conspiracy that caused millions of dollars in losses to Cuyahoga County over more than a decade.

Mitchell, a licensed attorney, was one of four partners in the law firm of Armstrong, Mitchell, Damiani and Zaccagnini (AMDZ). From 1997 through May 2009, Mitchell conspired to bribe programs receiving federal funds, according to the indictment.

Those he conspired with include former Cuyahoga County Auditor Frank Russo, former auditor employee Santina Klimkowski and his former law partners, according to the indictment.

Mitchell was part of a group that paid more than $1.1 million in cash bribes and kickbacks to Russo, sometimes through Klimkowski, in return for contracts worth $21.4 million related to commercial real estate appraisals, according to the indictment.

The charges include one count each of: conspiracy to commit bribery concerning programs receiving federal funds; bribery concerning programs receiving federal funds and Hobbs Act conspiracy.

If convicted, the defendant’s sentence will be determined by the court after a review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.

This case is being prosecuted by Assistant U.S. Attorney Gary D. Arbeznik, following investigation by the Cleveland office of the Federal Bureau of Investigation and the Internal Revenue Service. The investigation is ongoing.

An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be thegovernment’s burden to prove guilt beyond a reasonable doubt.

Wichita Falls, Texas Couple to Serve Long Federal Prison Sentences on Drug Convictions

WICHITA FALLS, TX—Lafayette Sheppard, 32, and Latasha Wyatt, 29, both of Wichita Falls, Texas, were sentenced today by U.S. District Judge Reed C. O’Connor to 327 months and 360 months, respectively, for possessing with intent to distribute 50 grams or more of crack cocaine, announced U.S. Attorney James T. Jacks of the Northern District of Texas. In handing down the sentences, Judge O’Connor cited each of the defendants’ extensive criminal histories.

Both Sheppard and Wyatt pled guilty to the offense in August 2010. According to documents filed with their pleas, on July 11, 2009, at approximately , police officers executed a search warrant at an apartment on
Lincoln Street
in Wichita Falls. Sheppard and Wyatt were in the master bedroom and loaded firearms were on nightstands, on either side of the bed. In addition, 61.70 grams of crack cocaine was found on top of a dresser and a digital scale was found in a dresser drawer.

Sheppard and Wyatt admitted that they possessed the crack cocaine with the intent to distribute it and that they possessed the firearms in furtherance of their drug-trafficking business, specifically to protect their inventory of crack cocaine and the profits from their drug-dealing business.

The case was investigated by the FBI and the Wichita Falls Police Department. Assistant U.S. Attorney Mary F. Walters prosecuted.

Virginia business owners sentenced to 18 months for harboring illegal aliens, forfeits $1.2 million

RICHMOND, Va. - Two business owners were sentenced on Tuesday to serve 18 months in prison followed by two years probation and forfeit $1.2 million, for their roles in a scheme to hire and harbor illegal aliens. This sentencing follows an investigation led by U.S. Immigration and Customs Enforcement (ICE) Office of Homeland Security Investigation (HSI).

"ICE aggressively targets employers who violate immigration laws by knowingly employing an unlawful workforce," said John P. Torres, special agent in charge of the ICE HSI in Washington, D.C. "Companies which profit through a business model that incorporates unlawful workers will be held accountable."

Bao Ping Wang, 44, pleaded guilty to harboring illegal aliens and Trang "Tammy" Lu, 45 pled to misprision of a felony.  Hi-Tech Trucking, Inc., a commercial trucking entity established by Wang and Lu for the delivery operations of SeaLands Food, another business operated by Wang and Lu for the distribution of seafood to Asian restaurants and markets throughout the mid-Atlantic region, was sentenced to three years probation for conspiring to harbor illegal aliens.

According to the court record, Hi-Tech Trucking, Inc. agreed to forfeit $1,225,428 in illegal proceeds gained as a result of the offense and to pay a $100,000 fine.  In addition, Wang was also ordered to pay $4,000 and agreed to deportation from the United States after service of his sentence.  Lu was ordered to pay $5,000 and agreed that she will comply with programs created by the Department of Homeland Security and Social Security Administration to screen all employees for determining workforce eligibility.

Wang and Lu both managed Hi-Tech Trucking, Inc., and SeaLands Food.  From 2006 through 2009, Wang employed a workforce at these companies consisting of both legal and illegal aliens, with Lu's knowledge or reckless disregard of the fact that a number of their employees were illegally present in the country and illegally working without proper authorization.  Federal investigators determined that Wang, with Lu's knowledge, harbored and employed between 6 to 24 illegal aliens at these companies at any point in time from 2006 through 2009.  Wang and Lu provided housing and meals for the illegal alien employees at three residences that they owned in Richmond, Virginia.  Bank records for Hi-Tech Trucking, Inc. accounts from 2006 through 2009 establish that withdrawals from these accounts were used for payments for rental properties for employees and utilities for the three residential properties at which employees were housed, as well as payments to employees, including illegal aliens.

Assisting ICE HSI in the investigation was the Internal Revenue Service-Criminal Investigation, and the Henrico Police Department.

Philadelphia-based CDI Corporation Settles False Claims Act Allegations

Allegedly Mischarged Labor Costs Under Military Aircraft Engine Contracts

WASHINGTON -- CDI Corporation has agreed to pay the United States $1.95 million to resolve allegations in a lawsuit brought under the False Claims Act that CDI wrongfully charged labor costs to work orders under military aircraft engine contracts for The General Electric Company (GE), the Justice Department announced today. According to the government’s allegations, the work for which the military was charged was not actually performed.

CDI is headquartered in Philadelphia. The CDI regional office, located in Sharonville, Ohio, was the subject of the False Claims Act allegations. CDI is a supplier of engineering services under time and material subcontracts with GE Transportation and Aviation divisions for engineering work on commercial and military projects.

The civil investigation examined CDI’s labor and billing records from Jan. 15, 2001, to Dec. 31, 2006. The civil investigation found that during this time period, CDI directed the mischarging of employees’ labor costs to purchase orders that would be reimbursed by the U.S. military. In fact, the employees did not perform the work billed to those military projects. CDI entered these mischarged labor costs in increments of 0.5 hours or less to evade detection.

"Those who contract with the U.S. military must do so fairly and honestly," said Tony West, Assistant Attorney General for the Civil Division of the Department of Justice. "Taxpayers should not foot the bill when government contractors charge for work that was not done."

The lawsuit was filed in the federal district court in Cincinnati by Vicki Lanich, a former CDI employee. Under the qui tam or whistleblower provisions of the False Claims Act, a private party can file an action on behalf of the United States and receive a portion of the recovery. Under the settlement, the whistleblower will receive $360,750.

This civil investigation was conducted by special agents of the U.S. Air Force Office of Special Investigations at Wright-Patterson Air Force Base near Dayton, Ohio. Audit support was provided by the Defense Contract Audit Agency, Mid-Atlantic Region. The settlement was negotiated by the Commercial Litigation Branch of the Justice Department’s Civil Division.

Worley Man Pleads Guilty to Involuntary Manslaughter

Joseph Michael Matt, Jr., 25, of Worley, Idaho, pled guilty yesterday in Coeur d’Alene to involuntary manslaughter, the United States Attorney’s Office announced.

According to the indictment, on August 18, 2009, Matt and his passenger, William Davison, were driving on
Lovell Valley Road
on the Coeur d’Alene Indian Reservation. Matt was under the influence of alcohol and methamphetamine and was speeding when he lost control of his vehicle. The ensuing crash killed Davison.

The charge carries a maximum punishment of up to eight years in prison, a fine up to $250,000, and up to three years’ supervised release.

Sentencing is scheduled for February 23, 2011, before U.S. District Judge Edward J. Lodge in Coeur d’Alene.

The case was investigated by the Coeur d'Alene Tribal Police, Idaho State Police, and the Federal Bureau of Investigation.

Former Virginia Secretary of Finance Sentenced for Embezzling $4 Million from Tobacco Indemnification Fund

RICHMOND, VA—John W. Forbes, II, age 54, of Richmond, Virginia, was sentenced to 120 months’ imprisonment today in U.S. District Court for orchestrating a wire fraud scheme that resulted in the embezzlement of $4,000,000 from the Virginia Tobacco Indemnification and Community Revitalization Commission. The defendant was also ordered to pay $4,000,000 in restitution to the Revitalization Commission. Neil H. MacBride, United States Attorney for the Eastern District of Virginia, made the announcement after the defendant was sentenced by United States District Judge Henry E. Hudson.

“John Forbes stole millions from the tobacco settlement fund while serving as Virginia’s top financial official,” said U.S. Attorney MacBride. “Instead of using settlement funds to help bring economic recovery to Virginia communities which had depended on tobacco, he stole millions of dollars which he spent on a lavish new home and personal investments. Today, Mr. Forbes was held responsible for betraying the public’s trust and will spend the next 10 years in prison.”

According to court records and testimony at the sentencing hearing, the fraud started when Forbes was serving as the Secretary of Finance of the Commonwealth of Virginia in 2001 and 2002. During his tenure as Secretary of Finance, he sat on the Board of the Revitalization Commission, which was created by the Virginia General Assembly in 1999 to promote economic growth and development in tobacco-dependant communities, using proceeds of the national tobacco settlement to accomplish its aim. At meetings in June 7 and 8, 2001, Forbes sought a $5,000,000 grant from the Revitalization Commission for a foundation he operated, the Literary Foundation of Virginia (“Literary Foundation”). In his presentation to the Revitalization Commission, Forbes explained that the Literary Foundation had the ability to leverage the proposed $5,000,000 grant into $15,000,000, which would be used to provide educational benefits for citizens in Southside and Southwest Virginia. Based on the defendant’s proposal, the Revitalization Commission awarded the Literary Foundation the $5,000,000 grant. The funds were wired to the Literary Foundation in two $2,500,000 installments: the first on July 23, 2001; the second on February 13, 2002.

In perpetrating the fraud, Forbes selected and put a sham Board of Directors in place at the Literary Foundation. He selected his then-wife to serve as the Literary Foundation’s Executive Director, at an annual salary of $130,000 per year. After Forbes’ tenure as Secretary of Finance concluded, he assumed the Executive Director position for the Literary Foundation. His annual salary was $130,000. During the Literary Foundation’s entire existence, Forbes orchestrated the fraudulent scheme and siphoned off the overwhelming majority of the revitalization funds for his own enrichment. To facilitate his fraud, Forbes created other sham entities, including the Community Development Council (“CDC”) and International Business Associates (“IBA”). Between February 4, 2003 and June 6, 2006, Forbes caused the wiring of $2,220,000 from the Literary Foundation to the CDC. These funds were ostensibly payment for public outreach services. CDC did not exist prior to its affiliation with the Literary Foundation, and at no time did CDC ever perform any work for any client. Although CDC purportedly used an address at
274 Madison Avenue
in New York City, that was a virtual address. In fact, according to its formation documents, CDC operated from the same address as the Literary Foundation.

Almost immediately after Forbes completed each transfer of funds from the Literary Foundation to CDC, he would withdraw the funds from CDC and deposit them into the bank account of IBA. Forbes founded IBA on December 31, 2002. It was located in the same office building as CDC and the Literary Foundation. IBA conducted no ongoing business, and its bank account served generally as Forbes’s private bank account. IBA had no source of income other than the fund transfers from CDC. Of the $2,220,000 CDC received from the Literary Foundation, $2,192,000 was ultimately transferred to IBA.

As part of his guilty plea, Forbes agreed that of the $5,000,000 the Commission granted to the Literary Foundation, only $942,000 was used to promote adult literacy, typically through grants and scholarships to students in Southside and Southwest Virginia. In addition, IBA spent approximately $40,000 on expenses related to public outreach for the Literary Foundation. The remaining funds, totaling approximately $4,000,000, were used for Forbes’s personal benefit, including salaries for Forbes and his ex-wife.

The investigation was conducted by the Federal Bureau of Investigation and Virginia State Police. Assistant United States Attorney Michael Gill prosecuted the case on behalf of the United States.

A copy of this press release may be found on the website of the United States Attorney's Office for the Eastern District of Virginia at http://www.usdoj.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on http://pacer.uspci.uscourts.gov.

Wednesday, November 24, 2010

Former Executive Director of SunRise Academy Accused of Stealing More Than $2.4 Million Meant for Special Education

Indicted on Mail Fraud, Wire Fraud, Other Charges

WASHINGTON—Charles Ike Emor, a/k/a Charles Ike Emenogha, 50, the founder and former executive director of SunRise Academy, a non-profit special education institution, has been indicted by a federal grand jury on charges that he stole more than $2.4 million in government money meant to serve needs of students. Among other things, Emor used the money for properties, cars, electronics, jewelry, and other personal expenses, the indictment states.

The indictment was announced by Ronald C. Machen Jr., U.S. Attorney for the District of Columbia; James W. McJunkin, Assistant Director in Charge of the FBI’s Washington Field Office; and Charles J. Willoughby, Inspector General for the District of Columbia.

“Tax dollars earmarked for schools are intended to buy textbooks, not luxury vehicles and diamond jewelry,” said U.S. Attorney Machen. “This indictment charges Charles Emor with stealing funds intended to benefit our children’s education.”

“This complex fraud scheme, which was investigated jointly by the FBI and the D.C. Office of Inspector General, involved the misappropriation of funds that were intended to assist District residents who needed help,” said Assistant Director in Charge McJunkin.

The indictment was unsealed today in the U.S. District Court for the District of Columbia. It includes 10 counts of mail fraud, 13 counts of wire fraud, two counts of interstate transportation of stolen property, one count of theft from a program receiving federal funds, nine counts of money laundering, one count of first degree theft, and one count of first degree fraud.

If convicted, Emor faces a maximum sentence of 20 years in prison and a $ 250,000 fine. Under the advisory United States Sentencing Guidelines, the range of imprisonment is presently 70 to 87 months.

According to the indictment, Emor was the founder, president, and executive director of SunRise Academy, a non-profit company that he started in 1999 to educate male students, aged 7 through 22, with emotional disturbances and learning disabilities. SunRise had two separate campuses in Northwest Washington, D.C. The Intermediate Campus was for males aged 7 through 15, and the SunRise Thurgood Marshall campus was for males aged 14 through 22.

SunRise students did not pay any tuition to attend the school. Rather, tuition and related services was provided to SunRise by public money. The amount of funding that SunRise received from D.C. Public Schools (“DCPS”) and the Office of the State Superintendent of Education ("OSSE") depended upon the number of students attending SunRise.

DCPS and the OSSE relied upon SunRise to report enrollment information honestly and accurately to ensure that it received the appropriate amount of reimbursement funding for tuition and related services that it provided to District of Columbia students with emotional and learning disabilities. From October 2005 through July 2010, SunRise was paid over $30 million of public funds to provide educational and related services for children with disabilities.

In June 2008, Emor created a for-profit company called Core Ventures, LLC. Emor owned 100 percent of the shares in Core Ventures. The purported purpose of Core Ventures was "consulting new businesses on how to set up their [business] plans, etc."

>From in or about January 2006 through in or about November 2010, Emor, aided and abetted by others, engaged in a scheme to defraud the government and to obtain public money, through SunRise, from DCPS and the OSSE, for his own use and benefit, and for the use and benefit of his friends and relatives, the indictment alleges. Among other things, Emor, through various misrepresentations and omission of material facts, induced DCPS and the OSSE to pay SunRise money for tuition and related services for special education students who were either truant, incarcerated, hospitalized, attended other schools, or otherwise dropped out.

According to the indictment, Emor used the public money to pay his personal expenses that were entirely unrelated to support the education of students with disabilities at Sunrise. These personal purchases included, but were not limited to, the payment of rent for the mother of his children in Upper Marlboro, Maryland; the payment of college tuition for his adult son; expensive jewelry; luxury watches; artwork; televisions and other electronic gadgets; custom-made clothing, and luxury vehicles, totaling in excess of $470,000.

Also, from March 2009 through January 2010, Emor transferred approximately $2 million from SunRise to his company, Core Ventures, the indictment states. He then created, or caused the creation of bogus SunRise Board of Director resolutions and Board meeting minutes that purportedly authorized SunRise to “lend” the $2 million to Core Ventures for the purposes of "operating a coffee shop" to employ SunRise students. The terms of the loan was never reduced to writing. Emor, his adult son, and a SunRise employee authorized the so called loan.

The indictment notes that OSSE revoked SunRise’s Certificates of Approval following the issuance of a report in May of 2010 that reviewed programs, policies and procedures.

The indictment includes a forfeiture allegation seeking all proceeds obtained through the scheme. Among other things, it seeks a money judgment of more than $2.4 million as well as bank accounts and a Lexus automobile registered to Core Ventures.

The case is being prosecuted by the United States Attorney’s Office for the District of Columbia and was investigated by the FBI’s Washington Field Office, the D.C. Office of the Inspector General and other federal agencies. The investigation is ongoing.

An indictment is merely a formal charge that a defendant has committed a violation of criminal laws and is not evidence of guilt. Every defendant is presumed innocent until, and unless, proven guilty.

Smishing and Vishing and Other Cyber Scams to Watch Out For This Holiday

You receive a text message or an automated phone call on your cell phone saying there’s a problem with your bank account. You’re given a phone number to call or a website to log into and asked to provide personal identifiable information—like a bank account number, PIN, or credit card number—to fix the problem. 

But beware:  It could be a “smishing” or “vishing” scam…and criminals on the other end of the phone or website could be attempting to collect your personal information in order to help themselves to your money. While most cyber scams target your computer, smishing and vishing scams target your mobile phone, and they’re becoming a growing threat as a growing number of Americans own mobile phones. (Vishing scams also target land-line phones.)

“Smishing”—a combination of SMS texting and phishing—and “Vishing”—voice and phishing—are two of the scams the FBI’s Internet Crime Complaint Center (IC3) is warning consumers about as we head into the holiday shopping season. These scams are also a reminder that cyber crimes aren’t just for computers anymore. 

Here’s how smishing and vishing scams work:  criminals set up an automated dialing system to text or call people in a particular region or area code (or sometimes they use stolen customer phone numbers from banks or credit unions). The victims receive messages like: “There’s a problem with your account,” or “Your ATM card needs to be reactivated,” and are directed to a phone number or website asking for personal information. Armed with that information, criminals can steal from victims’ bank accounts, charge purchases on their charge cards, create a phony ATM card, etc.

Sometimes, if a victim logs onto one of the phony websites with a smartphone, they could also end up downloading malicious software that could give criminals access to anything on the phone. With the growth of mobile banking and the ability to conduct financial transactions online, smishing and vishing attacks may become even more attractive and lucrative for cyber criminals.

Here are a couple of recent smishing case examples:

-Account holders at one particular credit union, after receiving a text about an account problem, called the phone number in the text, gave out their personal information, and had money withdrawn from their bank accounts within 10 minutes of their calls.
-Customers at a bank received a text saying they needed to reactivate their ATM card. Some called the phone number in the text and were prompted to provide their ATM card number, PIN, and expiration date. -Thousands of fraudulent withdrawals followed.

Other holiday cyber scams to watch out for, according to IC3, include:

-Phishing schemes using e-mails that direct victims to spoofed merchant websites misleading them into providing personal information.
-Online auction and classified ad fraud, where Internet criminals post products they don’t have but charge the consumer’s credit card anyway and pocket the money.  
-Delivery fraud, where online criminals posing as legitimate delivery services offer reduced or free shipping labels for a fee. When the customer tries to ship a package using a phony label, the legitimate delivery service flags it and requests payment from the customer.

IC3 Tips to Protect Yourself from Cyber Scams
- Don’t respond to text messages or automated voice messages from unknown or blocked numbers on your mobile phone. 

- Treat your mobile phone like you would your computer…don’t download anything unless you trust the source.

- When buying online, use a legitimate payment service and always use a credit card because charges can be disputed if you don’t receive what you ordered or find unauthorized charges on your card.

- Check each seller’s rating and feedback along with the dates the feedback was posted. Be wary of a seller with a 100 percent positive feedback score, with a low number of feedback postings, or with all feedback posted around the same date.

- Don’t respond to unsolicited e-mails (or texts or phone calls, for that matter) requesting personal information, and never click on links or attachments contained within unsolicited e-mails. If you want to go to a merchant’s website, type their URL directly into your browser’s address bar.

Jury Convicts Oakland, California, Patient Recruiter for Participating in Wheelchair Scam to Defraud Medicare

WASHINGTON – An Oakland, Calif., woman was convicted of health care fraud in connection with a scheme to bill Medicare for power wheelchairs that were medically unnecessary, announced the Departments of Justice and Health and Human Services (HHS).

On Monday, after a one-week trial in federal court in Los Angeles, a jury found Donna K. Wells, 52, guilty of one count of health care fraud. The evidence introduced at trial showed that Wells worked the streets and low-income, senior living communities of Oakland to recruit Medicare beneficiaries to bill Medicare for expensive power wheelchairs and other durable medical equipment (DME) which the beneficiaries did not want, need or use. The beneficiaries who testified at trial said that Wells approached them on the street, at the store, or in the lobby of their apartment buildings and offered them free power wheelchairs in exchange for the beneficiaries allowing Wells to copy their Medicare and California identification cards. One beneficiary testified that when she told Wells that she wanted a hospital bed and did not need or want a power wheelchair, Wells said that the beneficiary had to accept a power wheelchair in order to get a hospital bed. Based on that representation, the beneficiary agreed to accept both a power wheelchair and a hospital bed even though she did not need and never used the wheelchair.

Witnesses who lived in or worked at the San Pablo Hotel, one of the low-income senior living communities where Wells illegally recruited beneficiaries, testified that Wells often sat in the lobby of the hotel offering residents free power wheelchairs and copying their Medicare and California identification cards. These and other witnesses testified that many of the residents of the San Pablo Hotel did not use the power wheelchairs they received through Wells.

According to testimony at trial, Wells sold the beneficiaries’ Medicare information to others. Witnesses testified that Wells charged them between $400 and $500 for the Medicare information of each beneficiary she recruited. One witness testified that over a four-year period, Wells sold the witness the Medicare information of approximately 200 different beneficiaries. Once these witnesses received the Medicare information from Wells, they sold the information to a fraudulent medical clinic in Los Angeles, which then used the information to fabricate fraudulent prescriptions for power wheelchairs and other DME in the names of the beneficiaries whom Wells recruited. One of the doctors whose name appeared on these fraudulent prescriptions testified that he never wrote the prescriptions or treated any of the Oakland beneficiaries whom Wells recruited.

Witnesses testified that they purchased the fraudulent power wheelchair and DME prescriptions from the fraudulent medical clinic, and then sold both the Medicare information they received from Wells and the fraudulent prescriptions for more than $1,000 per prescription to a number of Los Angeles-area DME supply companies. These DME supply companies used the beneficiaries’ information and the fraudulent prescriptions to submit claims to Medicare for power wheelchairs which cost Medicare approximately $4,000 per wheelchair but cost the DME supply companies approximately $900 per wheelchair wholesale. Evidence introduced at trial showed that these DME supply companies submitted more than $577,000 in false power wheelchairs claims to Medicare. Several beneficiaries testified at trial that they did not need and rarely, if ever, used their power wheelchairs.

One of the DME supply companies that used the Medicare information from Wells was Maydads Medical Supply of Arleta, Calif. Trial evidence established that between June 2007 and August 2009, Maydads Medical Supply submitted approximately $470,973 in false and fraudulent claims to Medicare, almost all of which were for power wheelchairs. The owner and operator of Maydads Medical Supply, Sylvester Ijewere, pleaded guilty to health care fraud and was sentenced on Oct. 5, 2010, to 46 months in prison.

Wells was originally charged in October 2009 with three counts of health care fraud. The jury was unable to reach a verdict on two of the three counts. U.S. District Court Judge Dales S. Fischer scheduled Wells’ sentencing for March 28, 2011. Wells faces a maximum penalty of 10 years in prison and a $250,000 fine.

Today’s guilty verdict was announced by Assistant Attorney General Lanny A. Breuer of the Criminal Division; U.S. Attorney André Birotte Jr. for the Central District of California; Tony Sidley, Assistant Chief of the California Department of Justice, Bureau of Medi-Cal Fraud and Elder Abuse; Glenn R. Ferry, Special Agent-in-Charge for the Los Angeles Region of the Office of Inspector General for HHS (HHS-OIG); and Steven Martinez, Assistant Director in Charge of the FBI’s Los Angeles Field Office.

The case was prosecuted by Trial Attorney Jonathan Baum and Senior Trial Attorney John Michelich of the Criminal Division’s Fraud Section. The case was investigated by the California Department of Justice. HHS OIG assisted with the trial. The case was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Central District of California.

Since their inception in March 2007, Strike Force operations in seven districts have obtained indictments of more than 825 individuals who collectively have falsely billed the Medicare program for more than $2 billion. In addition, HHS Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.

Colombian extradited to US on narcotics trafficking charges

NEW YORK - A 45-year-old man from Colombia, and a former commander in a right-wing Colombian paramilitary drug organization, was extradited to the United States on charges of conspiracy to import cocaine into the United States and to engage in maritime narcotics smuggling following a New York Organized Crime Drug Enforcement Strike Force investigation.

According to the indictment and documents filed in the extradition proceedings, from 1999 through March 2009, Eder Pedraza-Peña, served as a commander in a right-wing paramilitary drug organization and terrorist group, then called the Autodefensas Unidas de Colombia (AUC) and now known as Bandas Criminales Emergentes, or BACRIMS.

For years, the AUC's main political objective has been to defeat the left-wing Colombian terrorist group Fuerzas Armadas Revolucionarias de Colombia (Revolutionary Armed Forces of Colombia, or FARC). The AUC, which is organized in individual "bloques" that control separate areas of Colombia, financed its terrorist activities through the proceeds of cocaine trafficking in AUC-controlled regions. Pedraza-Peña collected taxes from narcotics traffickers who transported cocaine through the "bloque" he controlled.

Pedraza-Peña also trafficked in cocaine, some of which was destined for Central America, Mexico, and ultimately the United States.   In January 2009, he arranged for a shipment of more than 2,000 kilograms of cocaine that was later seized by the U.S. Coast Guard in international waters off the coast of Jamaica. He was arrested by Colombian authorities on Oct. 11, 2009.

James T. Hayes, Jr., special agent in charge of the U.S. Immigration and Customs Enforcement (ICE) Office of Homeland Security Investigations (HSI) in New York stated: "This investigation shows ICE's resolve to pursue those who think they can ignore our nation's drug smuggling laws. We will continue to aggressively investigate those involved in illicit drug activity to ensure that they face justice."

Manhattan U.S. Attorney Preet Bharara said: "As we have charged, Pedraza-Peña was a ringleader of one of the most vicious and deadly narco-terrorist groups in South America.  He bankrolled his organization, in part, by allegedly smuggling their poison into the United States. Today's extradition demonstrates once again that we will work seamlessly with our law enforcement partners both here and around the world to thwart those who are exporting their illegal trade and to prosecute them to the full extent of the law."

DEA Special Agent-in-Charge John P. Gilbride said: "Eder Pedraza-Peña is charged with smuggling tons of cocaine into the United States and today he will face the consequences of his illegal enterprise. Time and time again, law enforcement investigates and identifies those individuals behind the scenes who are responsible for organizing illegal actions such as drug trafficking. This extradition is a statement for international, local, state and federal law enforcement that we will not tolerate drug trafficking in our communities and will continue to fully identify and investigate those who make millions off the sale of poison."

The New York Organized Crime Drug Enforcement Strike Force is composed of agents and officers of ICE HSI, Drug Enforcement Administration, New York City Police Department, U.S. Internal Revenue Service, Criminal Investigation Division, Federal Bureau of Investigation, New York State Police and the U.S. Coast Guard.