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Criminal Investigations

Press Releases tagged with "Criminal Investigations"

  • Four Individuals Indicted for Fraudulently Obtaining Pandemic Unemployment Benefits for Virginia Prison Inmates

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    Public Affairs (202) 254-4100

    For Immediate Release

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    NORFOLK, Va. – A federal grand jury returned an indictment yesterday charging four individuals with allegedly participating in a conspiracy to use the personal identifying information of 35 Virginia prison inmates in order to fraudulently obtain over $300,000 in pandemic-related unemployment benefits.    

    “As alleged in the indictment, the defendants deliberately stole funds intended for members of our community who have faced financial hardship and unemployment during the COVID-19 pandemic,” said Raj Parekh, Acting U.S. Attorney for the Eastern District of Virginia. “EDVA will continue to work with our law enforcement partners to safeguard these critical taxpayer-funded resources and hold accountable those who unlawfully line their pockets at the expense of the American people.”

    According to the indictment, Mary Benton, 38, of Portsmouth, and Angelica CartwrightPowers, 35, of Norfolk, allegedly worked with two inmates at Virginia correctional institutions to collect the personally identifiable information of other inmates to fraudulently apply for Virginia unemployment benefits during the COVID-19 pandemic.  Benton allegedly submitted successful applications for Virginia unemployment benefits for 31 inmates across three Virginia correctional facilities. Cartwright-Powers allegedly submitted successful applications for four inmates at one correctional facility. 

    “Fraudulently exploiting COVID-19 relief funds for personal gain is unconscionable,” said Joseph V. Cuffari, Inspector General for the Department of Homeland Security. “Today’s indictment sends a clear message that DHS OIG will fully investigate fraud affecting FEMA funds and continue to work with our law enforcement partners to bring an end to these
    schemes.”

    “Investigating fraud involving the Unemployment Insurance Program is an important part of the mission of the U.S. Department of Labor - Office of Inspector General, particularly during a time when our nation is providing billions of dollars in unemployment benefits to American workers in need of assistance due to the continuing economic effects of the ongoing COVID-19 pandemic,” said Derek Pickle, Special Agent in Charge of the Washington, DC Regional Office of the U.S. Department of Labor, Office of Inspector General. “We will continue to work with our law enforcement partners to vigorously investigate unemployment insurance fraud.”

    According to the indictment, co-conspirator Michael Lee Lewis, Jr., 41, of Chesapeake, allegedly provided information for inmates at the Augusta Correctional Center, where he was incarcerated. Michael Anthony White, 38, of Chesapeake, allegedly provided information for inmates at the Lawrenceville Correctional Center, where he was incarcerated. The four individuals charged in this indictment, along with the prisoners whose information was used for the unemployment applications, allegedly shared the proceeds of their crimes, which amounted to approximately $334,667. Although the conspirators initially and allegedly obtained $436,834, the Virginia Employment Commission was able to reclaim some of the disbursed funds after discovering the fraud.

    During the pandemic, both the federal government and the Virginia Employment Commission expanded unemployment benefits both by increasing the monetary amount, and by making benefits accessible for the self-employed, contractors, and gig workers, who have not historically qualified for unemployment. However, inmates remained ineligible for such benefits, and each application that Benton and Cartwright-Powers submitted allegedly contained numerous false statements that made the application successful, such as the inmates’ contact information and last employer, and that they were ready and willing to work.

    Benton is charged with one count of conspiracy, three counts of fraud in connection with major disaster benefits, and three counts of mail fraud. Lewis and White are each charged with one count of conspiracy and two counts of mail fraud. Cartwright-Powers is charged with one count of conspiracy, one count of fraud in connection with major disaster benefits, and one count of mail fraud. If convicted, the conspirators face a maximum of five years in prison on the conspiracy count and thirty years in prison on each fraud count.  Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors. 

    Raj Parekh, U.S. Attorney for the Eastern District of Virginia; Joseph V. Cuffari, Inspector General for the Department of Homeland Security; Derek Pickle, Special Agent-in-Charge of the Washington, DC Regional Office, U.S. Department of Labor, Office of Inspector General; and Paul Haymes, Chief of Investigations, Virginia Department of Corrections, Special Investigations Unit, made the announcement.

    This investigation was conducted under the auspices of “Operation Checkmate,” the Virginia Department of Corrections Inmate Unemployment Insurance Fraud Task Force.  The task force is led by the U.S. Attorney’s Office for the Eastern District of Virginia, DOLOIG, DHS-OIG, and the Virginia Department of Corrections. This investigation included assistance from the U.S. Secret Service’s Richmond Field Office, the Portsmouth Police Department, and the Virginia Employment Commission.

    Assistant U.S. Attorney Rebecca Gantt is prosecuting the case.

    A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:21-cr-33. An indictment is merely an accusation. The defendants are presumed innocent until proven guilty.
     

    DHS Agency
  • Serial Fraudster From Orlando Sentenced To More Than Six Years In Federal Prison

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    Public Affairs (202) 254-4100

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    Orlando, Florida – U.S. District Judge Paul G. Byron has sentenced Jermica Jerri Dominick Brooks (37, Orlando) a/k/a “Jermica Jerri Dominick Sykes” to six years and nine months in federal prison for two separate wire fraud schemes and aggravated identity theft. The court also ordered Brooks to forfeit more than $25,000, which is traceable to benefits she had received as a result of the offenses.

    Brooks had pleaded guilty on November 12, 2020.

    According to court documents, following Hurricane Irma in 2017, Brooks used stolen identities to file five applications for disaster assistance from the Federal Emergency Management Agency (FEMA). Brooks had obtained the personally identifiable information of certain victims during the course of her employment at a local plumbing business, where she worked as an office manager in or about 2016.  Brooks obtained other stolen identities by purchasing the information through illicit channels. At sentencing, a victim informed the Court that she was unable to obtain FEMA assistance following Hurricane Irma because Brooks had already filed a fraudulent application in her name.

    In a separate scheme, from January through May 2018, Brooks applied for and obtained 10 apartment leases in the names of identity theft victims. She used unauthorized or nonexistent financial account information to make it appear that her application and initial rent payments were legitimate, and feigned personal emergencies to secure occupancy in the leased apartments before those electronic payments were returned or rejected. Those leases resulted in a series of evictions in the names of Brooks’s victims. According to victims’ statements provided to the Court at sentencing, Brooks’s repeated use of their identities resulted in significant hardships surrounding their efforts to secure credit, housing, and car loans.

    This case was investigated by the Department of Homeland Security – Office of the Inspector General, the Orlando Police Department, the Casselberry Police Department, the Orange County Sheriff’s Office, and the Seminole County Sheriff’s Office. It was prosecuted by Assistant United States Attorney Emily C. L. Chang.
     

  • CEO Pleads Guilty to Defrauding Multiple Federal Agencies

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    Public Affairs (202) 254-4100

    For Immediate Release

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    ALEXANDRIA, Va. – An Arlington businessman pleaded guilty today to making false statements to multiple federal agencies in order to fraudulently obtain multimillion-dollar government contracts, COVID-19 emergency relief loans, and undeserved military service benefits.

    According to court documents, Robert S. Stewart, Jr., 35, was the owner and president of Federal Government Experts (FGE) LLC, an Arlington-based company that purported to provide various services to the U.S. government. In this capacity, Stewart made false statements to the Federal Emergency Management Agency (FEMA) and the Department of Veterans Affairs (VA) in order to obtain lucrative contracts to provide COVID-19 personal protective equipment (PPE). In addition, Stewart fraudulently obtained loans under the federal Paycheck Protection Program and the Economic Injury Disaster Loan Program, and he also defrauded the VA by falsely claiming to be entitled to veteran’s benefits for serving in the U.S. Marine Corps when, in fact, he never served in the Marines.

    “Stewart’s fraudulent conduct during a critical time in our Nation’s fight against COVID-19 undermined the government’s ability to provide much needed PPE to the community, including to the front-line health care workers serving our military veterans,” said Raj Parekh, Acting U.S. Attorney for the Eastern District of Virginia. “In addition, by fraudulently obtaining government-backed loans intended to be lifelines to keep businesses afloat, Stewart unlawfully took and misused resources devoted to help struggling Americans.”

    As part of his PPE scheme, Stewart falsely stated to procurement officials from FEMA and the VA that he was in possession of large quantities of PPE, including N95 masks. Based on Stewart’s false statements, the VA and FEMA awarded FGE contracts valued at $35,000,000 and $3,510,000, respectively. The VA intended to use the PPE purchased from FGE to protect employees and patients at various Veterans Health Administration facilities, which serve the medical needs of over nine million veterans each year. FGE failed to supply any PPE to the VA and FEMA. The U.S. government suffered no financial loss because the contract called for payment upon delivery and inspection of the goods.

    “Exploiting COVID-19 relief efforts for personal gain, to receive lucrative contracts with no intention of fulfilling them, is unconscionable,” said DHS Inspector General Joseph V. Cuffari. “I am proud of everyone at DHS OIG who worked on this case. I am also thankful to our law enforcement partners who helped us bring a swift end to this scheme.”

    Stewart also applied for various loans on behalf of FGE under the federal Paycheck Protection Program and the Economic Injury Disaster Loan Program. These programs were designed to provide emergency financial assistance to the millions of people suffering the economic effects of the COVID-19 pandemic. The loan applications submitted by Stewart falsely overstated the number of FGE employees and the amount of FGE’s payroll, two factors that were important in determining loan eligibility and the proper amount of the loan. In addition, Stewart used some of the loan proceeds for personal expenditures rather than to pay employees or for other appropriate business expenses. The loss to the U.S. government from this fraud is approximately $261,500.

    In a separate fraudulent scheme, Stewart, an Air Force veteran, submitted an application for benefits to the VA. The application was fraudulent in that Stewart falsely claimed that he also served in the U.S. Marine Corps. Stewart created fraudulent documents that stated he attained the rank of Corporal in the Marine Corps and was honorably discharged after receiving several awards and commendations, including the Rifle Expert Badge, Pistol Expert Badge, Meritorious Mast, National Defense Service Medal, Sea Service Deployment Ribbon, Southwest Asia Service Medal, Certificate of Appreciation, and the Kuwaiti Liberation Medal. Stewart, in fact, never served in the Marines. Based on his fraudulent application, he received excess benefits in the amount of $73,722.45.

    “By falsely claiming to have served in the U.S. Marine Corps to unlawfully increase his veteran’s benefits, Stewart stole money dedicated to providing resources and services to American military veterans and their families. This was an affront to those who honorably served,” said Acting U.S. Attorney Parekh. “We thank our law enforcement partners for bringing Stewart to justice.”

    Stewart pleaded guilty to making false statements, wire fraud, and theft of government funds and is scheduled to be sentenced on June 16, 2021. He faces a maximum penalty of 35 years in prison. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.

    Raj Parekh, Acting U.S. Attorney for the Eastern District of Virginia; James A. Dawson, Special Agent in Charge of the FBI’s Washington Field Office Criminal Division; Joseph V. Cuffari, Inspector General for the Department of Homeland Security (DHS); and Michael J. Missal, Inspector General for the U.S. Department of Veterans Affairs, made the announcement after U.S. District Judge Rossie D. Alston, Jr. accepted the plea.

    Assistant U.S. Attorney William Fitzpatrick is prosecuting the case.

    A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:21-cr-5.

  • Former U.S. Government Employee Pleads Guilty To Conspiracy To Steal U.S. Government Records and Defraud U.S. Refugee Program

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    Public Affairs (202) 254-4100

    For Immediate Release

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    WASHINGTON – An indictment charging three defendants was unsealed in the District of Columbia today.  The indictment charges Aws Muwafaq Abduljabbar, 42; Haitham Isa Saado Sad, 42; and Olesya Leonidovna Krasilova, 43, with conspiracy to steal U.S. government records and to defraud the United States, theft of U.S. government records, and conspiracy to launder money, all related to the U.S. Refugee Admissions Program (USRAP).  The indictment also charges Sad and Krasilova with computer fraud and abuse.  The announcement was made by Acting U.S. Attorney for the District of Columbia Michael R. Sherwin, the Inspector General for the Department of Homeland Security, Dr. Joseph V. Cuffari, and the U.S. Department of State’s Diplomatic Security Service (DSS) Assistant Director for Domestic Operations Ricardo Colón.

    According to the indictment, Sad was employed in Amman, Jordan from 2007 to 2016 by U.S. Citizenship and Immigration Services, and Krasilova held a similar position at the U.S. Embassy in Moscow, Russia.  Part of their duties included processing applications for refugee resettlement in the United States through the USRAP.  The indictment charges that, from approximately February 2016 until at least April 2019, the three defendants, led by Abduljabbar, conspired to steal U.S. government records related to hundreds of USRAP applications.  The records contained sensitive, non-public information about refugee applicants, their family members, their employment and military history, their accounts of persecution or fear of persecution, the results of security checks, and internal assessments by U.S. officials regarding applications.

    As outlined in the indictment, the theft of USRAP records creates a number of risks to public safety and national security while imposing significant costs on the U.S. government, its taxpayers, and otherwise legitimate refugee applicants negatively impacted by the scheme.  Defendants Abduljabbar and Sad were previously arrested and remain held without bond.  Defendant Krasilova remains at large.

    “The charges unsealed today demonstrate the commitment of the U.S. Attorney’s Office to protect the integrity of critical government functions like the U.S. Refugee Admissions Program, which exists to identify and admit qualified refugees for resettlement in the United States,” said Acting U.S. Attorney Michael R. Sherwin for the District of Columbia.  “It is important to hold accountable those who would seek to defraud such programs, particularly when the crimes compromise our national security and public safety, when they impose such high costs on taxpayers, and when they negatively impact the prospects of qualified refugee applicants.”

    “This indictment sends a strong message: the Diplomatic Security Service is committed to making sure that those who are alleged to have stolen U.S. government records related to refugee admissions face consequences for their criminal actions,” said DSS Assistant Director for Domestic Operations Ricardo Colón. “This case demonstrates the collaborative efforts of our law enforcement partners, and showcases the forensic and investigative capabilities of DSS.”

    “Individuals like Ms. Krasilova and Mr. Sad are entrusted to protect the integrity of the U.S. immigration system and sensitive information vital to our national security interests,” said Department of Homeland Security Inspector General Dr. Joseph V. Cuffari.  “The Office of Inspector General remains committed to aggressively investigating DHS employees who abuse their positions, betray the public trust, and conspire with persons such as Mr. Abduljabbar to defraud the United States.”

    The charges in the indictment are merely allegations, and every defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.  The maximum penalty for conspiracy to commit an offense or defraud the United States is five years; the maximum penalty for theft of government records is 10 years; the maximum penalty for conspiracy to launder money is 20 years; and the maximum penalty for the charged computer fraud and abuse is five years.  The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes.  If convicted of any offense, a defendant’s sentence will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.

    This case is being investigated jointly by the DHS Office of Inspector General and the U.S. Department of State’s Diplomatic Security Service.  It is being prosecuted by Assistant U.S. Attorneys Luke M. Jones and Erik M. Kenerson of the National Security Section of the U.S. Attorney’s Office for the District of Columbia.  The Justice Department’s Office of International Affairs assisted.

  • Three Foreign Nationals Charged with Conspiracy to Steal U.S. Government Records and Defraud U.S. Refugee Program

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    Public Affairs (202) 254-4100

    For Immediate Release

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    WASHINGTON – An indictment charging three defendants was unsealed in the District of Columbia today.  The indictment charges Aws Muwafaq Abduljabbar, 42; Haitham Isa Saado Sad, 42; and Olesya Leonidovna Krasilova, 43, with conspiracy to steal U.S. government records and to defraud the United States, theft of U.S. government records, and conspiracy to launder money, all related to the U.S. Refugee Admissions Program (USRAP).  The indictment also charges Sad and Krasilova with computer fraud and abuse.  The announcement was made by Acting U.S. Attorney for the District of Columbia Michael R. Sherwin, the Inspector General for the Department of Homeland Security, Dr. Joseph V. Cuffari, and the U.S. Department of State’s Diplomatic Security Service (DSS) Assistant Director for Domestic Operations Ricardo Colón.

    According to the indictment, Sad was employed in Amman, Jordan from 2007 to 2016 by U.S. Citizenship and Immigration Services, and Krasilova held a similar position at the U.S. Embassy in Moscow, Russia.  Part of their duties included processing applications for refugee resettlement in the United States through the USRAP.  The indictment charges that, from approximately February 2016 until at least April 2019, the three defendants, led by Abduljabbar, conspired to steal U.S. government records related to hundreds of USRAP applications.  The records contained sensitive, non-public information about refugee applicants, their family members, their employment and military history, their accounts of persecution or fear of persecution, the results of security checks, and internal assessments by U.S. officials regarding applications. 

    As outlined in the indictment, the theft of USRAP records creates a number of risks to public safety and national security while imposing significant costs on the U.S. government, its taxpayers, and otherwise legitimate refugee applicants negatively impacted by the scheme.  Defendants Abduljabbar and Sad were previously arrested and remain held without bond.  Defendant Krasilova remains at large.
                
    “The charges unsealed today demonstrate the commitment of the U.S. Attorney’s Office to protect the integrity of critical government functions like the U.S. Refugee Admissions Program, which exists to identify and admit qualified refugees for resettlement in the United States,” said Acting U.S. Attorney Michael R. Sherwin for the District of Columbia.  “It is important to hold accountable those who would seek to defraud such programs, particularly when the crimes compromise our national security and public safety, when they impose such high costs on taxpayers, and when they negatively impact the prospects of qualified refugee applicants.”

    “This indictment sends a strong message: the Diplomatic Security Service is committed to making sure that those who are alleged to have stolen U.S. government records related to refugee admissions face consequences for their criminal actions,” said DSS Assistant Director for Domestic Operations Ricardo Colón. “This case demonstrates the collaborative efforts of our law enforcement partners, and showcases the forensic and investigative capabilities of DSS.”

    “Individuals like Ms. Krasilova and Mr. Sad are entrusted to protect the integrity of the U.S. immigration system and sensitive information vital to our national security interests,” said Department of Homeland Security Inspector General Dr. Joseph V. Cuffari.  “The Office of Inspector General remains committed to aggressively investigating DHS employees who abuse their positions, betray the public trust, and conspire with persons such as Mr. Abduljabbar to defraud the United States.”

    The charges in the indictment are merely allegations, and every defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.  The maximum penalty for conspiracy to commit an offense or defraud the United States is five years; the maximum penalty for theft of government records is 10 years; the maximum penalty for conspiracy to launder money is 20 years; and the maximum penalty for the charged computer fraud and abuse is five years.  The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes.  If convicted of any offense, a defendant’s sentence will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.

    This case is being investigated jointly by the DHS Office of Inspector General and the U.S. Department of State’s Diplomatic Security Service.  It is being prosecuted by Assistant U.S. Attorneys Luke M. Jones and Erik M. Kenerson of the National Security Section of the U.S. Attorney’s Office for the District of Columbia.  The Justice Department’s Office of International Affairs assisted.

    DHS Agency
  • Former Acting Inspector General for the U.S. Department of Homeland Security Indicted on Theft of Government Property and Scheme to Defraud the United States Government

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    Public Affairs (202) 254-4100

    For Immediate Release

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    A federal grand jury in the District of Columbia returned a 16-count indictment against a former Acting Inspector General for the U.S. Department of Homeland Security (DHS) and a former subordinate for their alleged theft of proprietary software and confidential databases from the U.S. government as part of a scheme to defraud the U.S. government.

    Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Timothy J. Shea for the District of Columbia, DHS Inspector General Joseph V. Cuffari and Inspector General Tammy L. Whitcomb for the U.S. Postal Service (USPS) made the announcement.

    The indictment charges Charles K. Edwards, 59, of Sandy Spring, Maryland, and Murali Yamazula Venkata, 54, of Aldie, Virginia, with conspiracy to commit theft of government property and to defraud the United States, theft of government property, wire fraud, and aggravated identity theft.  The indictment also charges Venkata with destruction of records.

    According to the allegations in the indictment, from October 2014 to April 2017, Edwards, Venkata, and others executed a scheme to defraud the U.S. government by stealing confidential and proprietary software from DHS Office of Inspector General (OIG), along with sensitive government databases containing personal identifying information (PII) of DHS and USPS employees, so that Edwards’s company, Delta Business Solutions, could later sell an enhanced version of DHS-OIG’s software to the Office of Inspector General for the U.S. Department of Agriculture at a profit.  Although Edwards had left DHS-OIG in December 2013, he continued to leverage his relationship with Venkata and other DHS-OIG employees to steal the software and the sensitive government databases.

    The indictment further alleges that, in addition to stealing DHS-OIG’s software and the sensitive government databases, Venkata and others also assisted Edwards by reconfiguring his laptop so that he could properly upload the stolen software and databases, provided troubleshooting support whenever Edwards required it, and helped him build a testing server at his residence with the stolen software and databases, which contained PII.  As further part of the alleged scheme, Edwards retained software developers in India for the purpose of developing his commercial alternative of DHS-OIG’s software.

    The indictment is the result of an ongoing investigation by DHS-OIG and USPS-OIG and is being prosecuted by Trial Attorney Victor R. Salgado of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney David B. Kent of the U.S. Attorney’s Office for the District of Columbia.

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

    The year 2020 marks the 150th anniversary of the Department of Justice.  Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.

    DHS Agency
    Oversight Area
  • Two Maryland Men Facing Federal Indictment for Their Roles in a Scheme that Allegedly Stole Government Benefits, Including More Than $8 Million in Federal Emergency Assistance

    For Information Contact

    Marcia Murphy
    (410) 209-4854

    For Immediate Release

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    In July, a Third Man Pleaded Guilty to Participating in the Scheme

    Greenbelt, Maryland – A federal grand jury returned an indictment charging John Irogho, age 38, of Upper Marlboro, Maryland, for conspiracy to commit wire fraud, and charging Irogho and Odinaka Ekeocha, age 33, of Laurel, Maryland, for conspiracy to commit money laundering, in connection with a scheme to fraudulently obtain federal benefits.  The indictment was returned on July 31, 2019, and unsealed today upon the arrests of the defendants.

    The indictment was announced by United States Attorney for the District of Maryland Robert K. Hur; Special Agent in Charge Mark I. Tasky of the Department of Homeland Security (DHS) – Office of Inspector General; Special Agent in Charge Michael McGill of the Social Security Administration (SSA) Office of Inspector General; Special Agent in Charge Matthew S. Miller of the U.S. Secret Service – Washington Field Office; and J. Russell George, Treasury Inspector General for Tax Administration (TIGTA).

    “While many come forward in the wake of disasters to help selflessly, some use disasters to enrich themselves through theft and fraud,” said U.S. Attorney Robert K. Hur.  “The U.S. Attorney’s Office will pursue criminals who steal funds intended to help actual disaster victims.”

    “This indictment should serve as notice that the Treasury Inspector General for Tax Administration is committed to investigating illicit manipulations of IRS online systems, and bringing those involved to face justice,” said J. Russell George, Treasury Inspector General for Tax Administration.

    Michael McGill, Special Agent in Charge of the Social Security Administration Office of the Inspector General, Philadelphia Field Division said, “I want to thank our law enforcement partners for their efforts to bring these individuals to justice. We will continue to protect the integrity of the Social Security system, and pursue those who violate the public trust by committing fraud against Social Security and those who depend on it across the country.”

    During the time period covered by this indictment, the Federal Emergency Management Agency (FEMA) was responsible for providing emergency benefits and compensation for damage to victims who were affected by declared national emergency disasters, such as hurricanes and wildfires.  Among other benefits, an individual in an area affected by a national disaster was immediately eligible for “Critical Needs Assistance” (CNA) to purchase life-saving or life sustaining materials.  The assistance was paid to the victim in a manner of his/her choosing, including being deposited onto pre-paid debit cards.

    According to the two-count indictment, from 2016 through 2018 Irogho and several co-conspirators purchased hundreds of Green Dot debit cards, which co-conspirators then registered with Green Dot using the stolen personal information of identity theft victims from around the country.  In 2017, amidst Hurricanes Harvey, Irma, and Maria, and the California wildfires, co-conspirators allegedly applied online with FEMA for CNA using the stolen personal information of additional victims of identity theft.  According to the indictment, FEMA paid at least $8 million in amounts of $500 per claim to the Green Dot debit cards purchased by Irogho and his co-conspirators.

    In addition to filing false disaster-assistance claims with FEMA, the indictment alleges that co-conspirators also filed false claims online for Social Security benefits, for IRS tax refunds, and for Department of Labor unemployment and disability benefits using the stolen identities of multiple additional individuals, including name, address, Social Security Number (“SSN”), and other personal identifiers.

    The indictment alleges that FEMA, and the other federal agencies to whom fraudulent applications for benefits were submitted, deposited the falsely claimed benefits directly onto the Green Dot debit cards.  Funds were deposited onto the Green Dot debit cards in the names of multiple stolen identities, and in stolen identities that were different from the identities that had been used to register the cards. After the funds were placed onto the Green Dot debit cards, certain co-conspirators then informed other conspirators, including Irogho, that funds were available on the cards, and provided information to facilitate “cashing out” the funds from the cards.  The indictment also alleges that Irogho enlisted Ekeocha and other conspirators to cash out stolen funds from the Green Dot and other pre-paid debit cards, which Irogho, Ekeocha, and other co-conspirators did in exchange for a commission.  Irogho, Ekeocha, and their co-conspirators cashed out the cards soon after funds were added by depositing the money into bank accounts, and/or through ATM withdrawals or purchases of money orders.

    According to the indictment, Irogho and other co-conspirators took steps to conceal their identities and the conspiracy and scheme to defraud, by enlisting other individuals (including Ekeocha) to make the purchases and withdrawals, utilizing multiple store and bank locations and methods of withdrawal, using multiple bank accounts (including in the names of corporate entities), converting funds into cash rather than placing them into bank accounts, and making money orders payable to other individuals and/or corporate entities which they or their co-conspirators controlled.

    The conspirators allegedly used an encrypted messaging application, e-mail and other means to communicate, and used the stolen federal funds to pay rental and housing expenses, to purchase used vehicles, and for other purposes.

    If convicted, Irogho faces a maximum sentence of 30 years in federal prison for conspiracy to commit wire fraud.  Irogho and Ekeocha each face a maximum sentence of 20 years in federal prison for conspiracy to commit money laundering.  At their detention hearings today in U.S. District Court in Greenbelt U.S. Magistrate Judge Thomas M. DiGirolamo ordered that Irogho be detained pending a detention hearing scheduled for Monday, August 5, 2019 at 3:00 p.m.  Judge DiGirolamo ordered that Ekeocha be released under the supervision of U.S. Pretrial Services.

    An indictment is not a finding of guilt.  An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.

    In a related case, Tare Stanley Okirika, age 30, of Laurel, Maryland, pleaded guilty to wire fraud conspiracy on July 19, 2019, admitting that as part of the conspiracy to fraudulently obtain government benefits, he worked with other co-conspirators to cash out Green Dot and other prepaid debit cards.  Okirika admitted that he used the stolen federal funds from the scheme to pay his rent and for other purposes.  U.S. District Judge George J. Hazel has scheduled sentencing for Okirika on October 22, 2019, at 10:00 a.m.

    Members of the public who suspect fraud involving disaster relief efforts, or believe they have been the victim of fraud from a person or organization soliciting relief funds on behalf of disaster victims, should contact the National Disaster Fraud Hotline toll free at (866) 720-5721.  The telephone line is staffed by a live operator 24 hours a day, 7 days a week.  You can also fax information to the Center at (225) 334-4707, or email it to disaster@leo.gov.  Learn more about the Department of Justice’s National Center for Disaster Fraud at http://www.justice.gov/disaster-fraud.

    United States Attorney Robert K. Hur commended the DHS OIG, the SSA OIG, the USSS, and TIGTA for their work in this investigation.  Mr. Hur thanked Assistant U.S. Attorneys Elizabeth G. Wright, and Kelly O. Hayes, who are prosecuting these cases.

    DHS Agency
    Oversight Area
  • Siskiyou County Man Charged with Major Fraud Against the United States for Taking FEMA Grant Funds

    For Information Contact

    DOJ

    Press Release Number: 
    2:19-cr-084-KJM

    For Immediate Release

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    Grant Administrator Misused over $500,000 Intended for Recruiting and Training New Firefighters

    SACRAMENTO, Calif. — Samuel Thomas Lanier, 40, of Dunsmuir, was charged today with seven counts of major fraud against the United States, U.S. Attorney McGregor W. Scott announced.

    According to court documents, from approximately June 2013 to March 2018, Lanier engaged in a scheme to defraud the United States by submitting, or causing to be submitted, false reimbursement requests to the Federal Emergency Management Agency (FEMA) in connection with federal grants awarded to Siskiyou and Shasta County Fire Chiefs Associations to assist them in recruiting and training new firefighters.

    In June 2013 and June 2014, respectively, the Siskiyou and Shasta County Fire Chiefs Associations were awarded grants as part of the Staffing for Adequate Fire and Emergency Response (SAFER) program. Each grant was over $1 million. The purpose of these grants was to assure that communities have adequate protection from fire-related hazards, and to help the recipients attain and maintain 24-hour staffing.

    Lanier, as an owner or executive of two companies located in Dunsmuir, was hired by the Fire Chiefs Associations to administer these grants. In this capacity, Lanier knowingly submitted to FEMA false and fraudulent reimbursement requests, seeking and obtaining reimbursement for goods and services that were not, in fact, actually obtained on behalf of the fire associations. In so doing, Lanier caused a gross loss to the United States of over $500,000.

    This case is the product of an investigation by the Major Frauds & Corruption Unit of the Department of Homeland Security, Office of Inspector General. Assistant U.S. Attorney Amy Schuller Hitchcock is prosecuting the case.

    “The Department of Homeland Security (DHS), Office of Inspector General (OIG) in partnership with the Department of Justice is committed to identifying and investigating fraud schemes and corrupt activities that pose significant risk and major financial impact to DHS and its components, including FEMA. This fraud scheme siphoned vital funds from a federal program that supports local fire departments to serve their communities,” said James E. Long, Special Agent in Charge, Major Frauds and Corruption Unit, DHS OIG. “Fraud perpetrated against FEMA is detrimental to our nation’s infrastructure and safety, especially from programs that support front line firefighters and first responders.”

    Lanier has agreed to plead guilty to the charges. He faces a maximum statutory penalty of 10 years in prison and a $10 million fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.

    DHS Agency
  • U.S. Customs and Border Protection Officer Indicted on Charges of Theft and False Statements

    For Information Contact

    Trial Attorney Rebecca Moses of the Criminal Division’s Public Integrity Section

    For Immediate Release

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    A federal grand jury sitting in the Southern District of Texas returned an indictment on Dec. 12 charging a U.S. Customs and Border Protection (CBP) officer with converting federal funds to his own use, with concealing material facts from CBP, and with making false representations to CBP, Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division announced.

    Daniel Lerchbacker, 35, of Conroe, Texas, was charged with three counts of theft for allegedly failing to pay three Canadian entities for expenses that the United States had already provided the funds to cover and for collecting federal funds to which he knew he was not entitled.  Lerchbacker was also charged with two counts of false statements for allegedly submitting to CBP copies of checks as proof of payment, despite knowing that such payments had not, in fact, been made.  Lerchbacker will be arraigned on the charges today at 2 p.m. CST before U.S. Magistrate Judge Christina A. Bryan in U.S. District Court in the Southern District of Texas in Houston.

    According to the indictment, Lerchbacker, while stationed in Canada as a CBP officer between December 2015 and December 2017, allegedly received from the U.S. foreign monetary allowances for the lease of his family’s residence and private school education expenses for his children.  During this time, Lerchbacker received the full amount of federal funds that he requested for these expenses, but Lerchbacker allegedly failed to pay a property management company and two private schools a total of approximately $54,460.99 CAD.  Additionally, Lerchbacker allegedly requested, collected, and retained from the United States approximately $24,230.50 CAD in advance funds for educational expenses for his children while knowing that he was to leave Canada before the end of the school year.

    An indictment is merely an allegation, and the defendant is presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

    The case is being investigated by the Department of Homeland Security Office of Inspector General and is being prosecuted by Trial Attorney Rebecca Moses of the Criminal Division’s Public Integrity Section.

  • Former West Virginia Cabinet Secretary Sentenced to Federal Prison for Embezzling Fire Department Funds

    For Information Contact

    Assistant United States Attorney Meredith George Thomas

    For Immediate Release

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    HUNTINGTON, W.Va. – A Hurricane man and former West Virginia Cabinet Secretary was sentenced today to 37 months in federal prison for embezzling $178,790 from the Teays Valley Volunteer Fire Department, as well as a related tax crime, announced United States Attorney Mike Stuart.  Clifford Keith Gwinn, 64, formerly the Cabinet Secretary of the West Virginia Department of Veterans Assistance, previously pled guilty in June 2018 to theft from a program receiving federal funds and failure to report and pay over payroll taxes.  As part of Gwinn’s sentence, he was also ordered to pay restitution to the Fire Department, and it’s insurer, in the amount of  $178,790 and to the Internal Revenue Service in the amount of $68,281.  Stuart commended the investigative efforts of the Federal Bureau of Investigation, the Internal Revenue Service Criminal Investigation Division, the Office of Inspector General for the U.S. Department of Homeland Security, and the West Virginia Commission on Special Investigations.

    “Unimaginable that anyone, much less a former leader in state government, would steal from a Fire Department that is dependent upon funding to provide vital public safety services,” said United States Attorney Mike Stuart.  “We will aggressively prosecute and seek restitution for victim organizations in cases like this one.”

    Gwinn admitted that as Vice President and fiscal officer of the Fire Department, he was in charge of the financial affairs of the Fire Department and exercised significant control over the Fire Department’s finances.  He admitted that his duties included reporting income and expenditures to the Fire Department, preparing and submitting taxes for the Fire Department, and assisting with applications and reimbursements for federal grants, among other duties.   He further admitted that he, without authorization from the Fire Department, opened a Fire Department bank account where only he had signature authority, transferred funds into that account without the knowledge or authorization from the Fire Department, ensured certain health care insurance company reimbursements were deposited into that account, and wrote himself checks and checks to cash out of that account, which he then typically cashed.  He admitted that he further instructed the Fire Department’s Treasurer to write him checks from other Fire Department bank accounts and further misrepresented the amount of bank account balances to the Fire Department officers and board members.  He also admitted that he structured withdrawals out of the Fire Department’s accounts in a series of transactions below $10,000, to prevent the banks from filing Currency Transaction Reports.  While he admitted that he systematically deposited cash into Fire Department bank accounts, his overall withdrawals and payments received significantly overwhelmed the amount of any deposits.   He also admitted that he had no authorization to write himself checks or receive and cash checks from the Fire Department, and was not entitled to any compensation.

    During the period from 2013 through 2016 that Gwinn embezzled $178,790 in Fire Department funds, the Teays Valley Volunteer Fire Department received grants from the Federal Emergency Management Agency (FEMA), an agency of the United States Department of Homeland Security. These grants allowed the Fire Department to pay firefighters and to purchase and maintain equipment.

    Furthermore, Gwinn admitted that that while he was Vice President and fiscal officer for the Fire Department, the Fire Department withheld taxes from its employees’ paychecks, including federal income taxes, Medicare, and social security taxes, together known as payroll taxes.  He admitted that he knew that he had the corporate responsibility to collect, truthfully account for, and pay over the Fire Department’s payroll taxes.  Gwinn admitted that from October 31, 2015 through April 30, 2017, while Gwinn was a responsible person for payroll taxes, Fire Department failed to account for and pay over approximately $61,421.31 in payroll taxes.

    Gwinn further admitted that when he filed his personal income tax returns with the IRS, those returns were false because they failed to account for the funds he had embezzled from the Fire Department.  Assistant United States Attorney Meredith George Thomas handled the prosecution. United States District Judge Robert C. Chambers imposed the sentence.