“West Hollywood Doctor Indicted on Federal Charges for Writing Prescriptions for Narcotics after being Ordered to Stop”

May 14, 2013

The Drug Enforcement Administration (DEA) on May 13, 2013 released the following:

“MAY 13 (LOS ANGELES) – A West Hollywood doctor surrendered to federal authorities this morning after being indicted last Friday on federal drug trafficking charges that allege he wrote more than 1,200 prescriptions for powerful painkillers after a federal order revoked his authority to prescribe those drugs.

James William Eisenberg, 72, who resides in the Venice district of Los Angeles, surrendered this morning at the United States Courthouse, where he is expected to be arraigned this afternoon.

Eisenberg is named in an indictment that charges him with four counts of using a revoked DEA registration number and three counts of distribution of hydrocodone, which is the generic drug found in brand-name products such as Vicodin and Norco.

Eisenberg allegedly wrote the prescriptions while he worked out of several medical offices in West Hollywood, including a Santa Monica Boulevard storefront he called Pacific Support Services. Eisenberg also issued “medical marijuana” recommendations from these West Hollywood locations, according to court documents and DEA administrative records.

In order to legally prescribe controlled substances such as hydrocodone, physicians must be registered with the United States Attorney General and have a valid DEA registration number. On December 14, 2011, a DEA administrative judge determined that Eisenberg acted as a “drug dealer” and suspended his registration number. The DEA issued an order permanently revoking Eisenberg’s registration on July 24, 2012.

The orders issued by the administrative judge were based on findings that Eisenberg, who at the time was working out of a “medical marijuana” club in Arizona, “lacked a legitimate medical purpose and acted outside of the usual course of professional practice” when he wrote prescriptions for oxycodone (the generic form of a drug often best known as the brand-name OxyContin) and Xanax in exchange for $150 cash payments. The DEA judge also found that Eisenberg wrote “medical marijuana” recommendations to undercover officers posing as patients, and that Eisenberg prescribed OxyContin to one of the undercover agents “before [Eisenberg] had even performed a physical examination.”

DEA investigators later learned that Eisenberg continued to prescribe controlled substances, including hydrocodone, in violation of the DEA’s orders. A review of a California Department of Justice database that can be used to track prescriptions showed that, following the suspension of Eisenberg’s registration number, patients filled more than 1,700 of his prescriptions for controlled substances, including more than 1,200 prescriptions for hydrocodone. As charged in the indictment, Eisenberg wrote one of those prescriptions on December 27, 2011, less than two weeks after his registration number was suspended.

DEA investigators executed a federal search warrant on one of Eisenberg’s West Hollywood offices on February 19, 2013. The affidavit in support of the search warrant outlines evidence, including surveillance and undercover operations, indicating that Eisenberg continued to write prescriptions for controlled substances in violation of the DEA’s revocation order. The evidence included an operation in which an undercover agent, posing as a patient, obtained a prescription from Eisenberg for hydrocodone and alprazolam (the generic form of a drug best known as Xanax). A receptionist at Eisenberg’s office asked the undercover agent if “he was looking for medical marijuana” as well, according to the search warrant affidavit. According to the affidavit, when a West Hollywood pharmacist refused to fill Eisenberg prescriptions for hydrocodone and alprazolam in June 2012, Eisenberg called the pharmacy and asked the pharmacist to make an “exception” and fill the prescription.

An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty.

If convicted of the seven counts in the indictment, Eisenberg faces a statutory maximum sentence of 46 years in federal prison.

The investigation into Eisenberg was conducted by the Drug Enforcement Administration.”

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

Federal Crimes – Be Careful

Federal Crimes – Be Proactive

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To find additional federal criminal news, please read Federal Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition Defense, OFAC SDN Sanctions Removal, International Criminal Court Defense, and US Seizure of Non-Resident, Foreign-Owned Assets. Because we have experience dealing with INTERPOL, our firm understands the inter-relationship that INTERPOL’s “Red Notice” brings to this equation.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


FBI releases documents that confirm they spy on anarchists

October 22, 2012

RT on October 22, 2012 released the following:

“Two anarchists remain locked up as prosecutors attempt to coerce the testimonies they’ve been subpoenaed to give about acts of vandalism in the Pacific Northwest. In the meantime, though, the FBI has accidentally blown the cover off its own case.

Ever since Leah Plante, Katherine “KteeO” Olejnik and Matt Duran were asked to testify before a federal grand jury earlier this year, all three self-identified anarchists have been adamant about remaining silent. For refusing to speak, federal prosecutors have since put the trio of twenty-something activists behind bars over contempt of court charges, with Plante being awarded her freedom only in recent days. As her colleagues continue their imprisonment, though — where they could remain for the entirety of the 18-month investigation — the FBI has failed to provide to the press or public alike any information as to why they’ve targeted the known activists or what role they could play in unraveling a greater conspiracy.

On Thursday, legal documents intended to be cloaked indefinitely were accidently unsealed in US District Court in Seattle for a moment, finally offering a small bit of insight as to why the FBI has been targeting adherents to a specific ideology and intensifying what some have equated to a politically-motivated witch-hunt aimed at anarchists.

The Seattle Times reports that an affidavit dated October 3 was momentarily made available during last week’s court proceedings, revealing to those in attendance that the investigation into Plante and her peers dates back to earlier this year when the FBI first began spying on a group of suspected anarchists they believed were conspiring to commit acts of violence and destruction.

Beginning as early as April 9, the FBI was conducted surveillance on alleged anarchists from Portland whom soon after planned to travel to Seattle to participate in the city’s May 1, 2012 day of action activities held in coordination with other locales across the country. The feds followed a group of six suspects across state lines from Portland, Oregon into Olympia, Washington in the days before the May Day activities and drafted an indictment that could eventually lead them to charge the group with conspiracy, destruction of government property and interstate travel with intent to riot, according to the 34-page document viewed by the Times. So far, though, none of the six suspects have been formally charged with any crimes.

“Although many anarchists are law abiding, there is a history in the Pacific Northwest of some anarchists participating in property destruction and other criminal activity in support of their philosophy,” the affidavit reads, according to the newspaper.

That’s where the Pacific Northwest Three fit in: investigators had hoped that by subpoenaing Plante, Olejnik and Duran to testify, they’d learn more about anarchists in the region who may have been vocal about any attempts to wreak havoc during the May Day protests.

According to the search warrant unsealed this week, the government claims that tens of thousands of dollars in damages resulted from the May 1 actions in Seattle, largely due to attacks on the William Kenzo Nakamura U.S. Courthouse and a few private businesses in the vicinity. Video footage obtained from the scene has been endlessly analyzed by FBI detectives who have in the weeks and months since tried to build a case to file charges against the suspects, none of whom are reported to include the three persons asked to testify. That investigation has led to filing not just subpoenas against the Pacific Northwest Three, but executing no fewer than five search warrants in July that aimed to recover cell phones, computers, clothing and literature from Plante, her peers and others believed to be in cahoots with any local anarchists.

In addition to being met with silence from the Northwest Three, the trove of “evidence” uncovered by the authorities has so far left them unable to release an indictment targeting their suspects. Instead, they have been left with cell phones that, according to the unsealed affidavit, contain text messages describing the May Day protest as “awesome” but nothing more remotely noteworthy, or at least not enough to file charges.

While Plante has since been freed from prison where she was held in solitary confinement for refusing to comply with the grand jury, both Olejnik and Duran remain behind bars as investigators wait to see if they’ll be willing to speak.

“What (prosecutors) decided to do is choose people and punish them for their association,” Jenn Kaplan, an attorney for Olejnik, tells the Seattle Times. To the paper, a counsel for Olejnik adds that the grand jury investigation specifically sought answers from the anarchist about someone she knows.

Before being imprisoned and released, Plante said that a Freedom of Information Act request she filed revealed that the grand jury was first convened in March, two months before the vandalism she is being questioned about even occurred. Before being held in contempt of court, Plante wrote, “The government wants to use [grand juries] to collect information that it can use in a campaign of repression. I refuse to have any part of it, I will never answer their questions, I will never speak.”

An attorney for Duran adds that while their client isn’t being suspected or accused of the May 1 vandalism in Seattle, the associations that exist within the community are enough to keep him under the FBI’s radar. The intended result, many fear, is a chilling effect on a community of likeminded individuals that could soon enshroud other groups of activists and outspoken youths.

“One of our concerns was they were really targeting him because they perceived him to be associated with the anarchist community,” Gordon says. “It’s kind of a fishing expedition.””

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

Federal Crimes – Be Careful

Federal Crimes – Be Proactive

Federal Crimes – Federal Indictment

Federal Crimes – Detention Hearing

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To find additional federal criminal news, please read Federal Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition Defense, OFAC SDN Sanctions Removal, International Criminal Court Defense, and US Seizure of Non-Resident, Foreign-Owned Assets. Because we have experience dealing with INTERPOL, our firm understands the inter-relationship that INTERPOL’s “Red Notice” brings to this equation.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


Megaupload charges should stay: US

June 15, 2012

The Sydney Morning Herald on June 15, 2012 released the following:

“AAP

Lawyers for the US government say attempts to have internet piracy charges against Megaupload founder Kim Dotcom thrown out are a waste of time.

German-born Dotcom, who the United States wants to extradite from New Zealand to face piracy charges, is arguing in a US court that the US has no jurisdiction over the Hong Kong-based cloud storage service.

But the US Attorney’s office argues that defence is a waste of time and resources, CNET reports.

It says some of Megaupload’s lawyers have conflicts of interest – representing in the past some of the witnesses and victims, including Google, Disney, Time Warner and Paramount Pictures.

Neil MacBride, US Attorney for Eastern District of Virginia, compared Megaupload’s request that more of the company’s money be returned to “returning money to a bank robber”.

Hollywood film studios say that Megaupload enabled millions of people around the world to store pirated movies and TV shows in the company’s digital lockers.

Meanwhile, a New Zealand high court judge has effectively halted a previous court decision to allow Dotcom and his three co-accused access to some of the information that will be used against them in an extradition hearing scheduled for August.

An urgent two-day judicial review has been ordered, although a date is yet to be set.

In the meantime US government lawyers must prepare the information so it can be handed over if the review rules in favour of the Megaupload group.

When New Zealand police raided Dotcom’s mansion north of Auckland earlier this year at the request of the US, FBI agents seized a massive 150 terabytes of data.

Dotcom is also waiting on a decision on a High Court judicial review seeking the return of 135 computer and data storage devices, challenging the legality of the search warrants used to seize them.”

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

Federal Crimes – Be Careful

Federal Crimes – Be Proactive

Federal Crimes – Federal Indictment

Federal Crimes – Detention Hearing

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To find additional federal criminal news, please read Federal Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition Defense, OFAC SDN Sanctions Removal, International Criminal Court Defense, and US Seizure of Non-Resident, Foreign-Owned Assets. Because we have experience dealing with INTERPOL, our firm understands the inter-relationship that INTERPOL’s “Red Notice” brings to this equation.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


Army Master Sergeant Arrested by AFOSI and the FBI

May 31, 2012

The Federal Bureau of Investigation on May 30, 2012 released the following:

“TAMPA—On Wednesday, May 30, 2012, special agents from the Air Force Office of Special Investigations (AFOSI) and the FBI Innocent Images Task Force (IITF) arrested Army Master Sergeant Thomas Meyer, age 42, at his residence this morning without incident. A federal search warrant was also executed at Meyer’s residence today.

The law enforcement activity was the culmination of investigative efforts by the AFOSI; Largo Police Department; Kenton County Police Department, Kentucky; Pennsylvania State Police; United States Postal Inspection Service; and the FBI.

Meyer will be facing federal charges, including attempted production of child pornography, transportation of child pornography, and transfer of obscene material to an individual under the age of 16. If convicted, he faces a mandatory minimum penalty of 15 years, up to 30 years in federal prison for the production charge; a mandatory minimum penalty of five years, up to 20 years in federal prison for the transportation charge; and up to 10 years in federal prison for the transfer of obscene matter charge.

The FBI’s IITF is an intelligence-driven, proactive investigative initiative that combats the proliferation of child pornography and child sexual exploitation facilitated by the Internet. The mission of the IITF is to reduce the vulnerability of children to acts of sexual exploitation and abuse facilitated through computers; to identify and rescue witting and unwitting child victims; and to investigate and prosecute sexual predators who use the Internet to sexually exploit children for personal and financial gain.

The charges in the complaint are merely allegations and the defendant is presumed innocent, unless, and until proven guilty.”

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

Federal Crimes – Be Careful

Federal Crimes – Be Proactive

Federal Crimes – Federal Indictment

Federal Crimes – Detention Hearing

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To find additional federal criminal news, please read Federal Criminal Defense Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition Defense, OFAC SDN Sanctions Removal, International Criminal Court Defense, and US Seizure of Non-Resident, Foreign-Owned Assets. Because we have experience dealing with INTERPOL, our firm understands the inter-relationship that INTERPOL’s “Red Notice” brings to this equation.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


Federal Agents Raid Calif. Marijuana University

April 4, 2012

MyFoxAtlanta.com on April 2, 2012 released the following:

“TERRY COLLINS, Associated Press

OAKLAND, Calif. (AP) – Federal agents on Monday targeted a San Francisco Bay area medical marijuana training school started by a leading pot advocate who has been instrumental in pushing for ballot measures to legalize the drug.

The doors to Oaksterdam University in downtown Oakland were blocked by U.S. marshals and yellow tape following the early morning raid by agents with the Internal Revenue Service and the U.S. Drug Enforcement Administration.

Agents carted trash bags of unknown materials out of the school as protesters gathered to condemn the action. A museum connected to the school and a nearby medical marijuana dispensary operated by Oaksterdam founder Richard Lee also were raided.

Demonstrators outside the multistory building, some openly smoking marijuana, held signs demanding an end to federal crackdowns on marijuana, which remains illegal under federal law.

Ryan Hooper, 26, of Oakland, wearing an Oaksterdam hat and sweat shirt, said he had finished taking courses at the school in February.

“This is not in the best interest of the city,” Hooper said. “If they close the dispensaries, all of this stuff is going to go back underground.”

Oaksterdam University was founded by Lee, who spent more than $1 million as the main backer of a California ballot measure defeated in 2010 that would have legalized marijuana in the state for recreational use. Lee did not immediately return a message seeking comment.

The school offers classes to would-be medical marijuana providers in fields ranging from horticulture to business to the legal ins-and-outs of running a dispensary. It does not distribute marijuana.

Arlette Lee, an IRS spokeswoman and no relation to Richard Lee, told reporters that agents were serving a federal search warrant but said she could not otherwise comment on the purpose of the raid.

“What we are doing here today is under seal,” Lee said.

Agents also raided Richard Lee’s home and briefly detained him during their search but did not arrest him, said Dale Sky Jones, Oaksterdam’s executive chancellor.

“Clearly, they’re trying to knock down one of the leaders in the cannabis reform movement,” Jones said.

No other arrests were reported, and it was unclear if the raid was prompted by a civil or criminal complaint. Jack Gillund, a spokesman for the U.S. attorney’s office, also declined comment.

The raid was the latest move by the federal government to crack down on California’s thriving medical marijuana industry. Federal prosecutors across the state joined late last year to shut down dozens of dispensaries by threatening to seize landlords’ property if they did not evict marijuana retailers.

The government’s action came as a surprise to medical marijuana advocates because the city of Oakland has been somewhat of a safe haven for pot clinics. The city has long allowed four medical marijuana dispensaries to legally operate under city ordinances and recently awarded permits that would allow four more to open.

“Oakland has one of the most highly regulated systems for distributing medical marijuana in the state,” said Stephen Gutwillig, California’s director for the Drug Policy Alliance. “We think this is a campaign by the U.S. attorneys not just to limit but to kill access to medical marijuana in California.”

Others countered that pot advocates are mistaken if they believe the Obama administration wouldn’t take action.

“This is a warning signal to any city including Oakland that they should tread very carefully when sanctioning an illegal activity,” said Kevin Sabet, a former senior adviser to the president’s drug czar and an assistant professor at the University of Florida. “The brazenness of Oakland and other cities like this has actually made them a target.”

Some observers said the federal government’s decision to go after Oaksterdam shows it’s not going to back down.

“It doesn’t get much more confrontational than that,” said Alex Kreit, a law professor at the Thomas Jefferson School of Law in San Diego.”

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

Federal Crimes – Be Careful

Federal Crimes – Be Proactive

Federal Crimes – Federal Indictment

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To find additional federal criminal news, please read Federal Crimes Watch Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition and OFAC SDN Sanctions Removal.

The author of this blog is Douglas C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


Law enforcement official: FBI, IRS agents searching home of DC Councilmember Harry Thomas Jr.

December 2, 2011
D.C. Councilmember Harry Thomas Jr.

The Washington Post on December 2, 2011 released the following:

“By Associated Press

WASHINGTON — FBI and IRS agents searched the home Friday of D.C. Councilmember Harry Thomas Jr., who’s been under investigation for several months after being accused of diverting more than $300,000 in city funds for personal use.

The official, who spoke to The Associated Press on the condition of anonymity because the official was not authorized to discuss the matter, said the search was related to an ongoing investigation of the councilmember. Authorities are not expected to make any arrests, unseal documents or make any public announcements Friday related to the case.

Federal authorities have been investigating Thomas, a Democrat representing Ward 5, at least since June, when the District of Columbia attorney general filed a lawsuit accusing him of spending more than $300,000 in city funds on a luxury SUV, vacations and other personal expenses. Thomas agreed to repay the money but did not admit any wrongdoing.

In the wake of the allegations, Thomas stepped down from his chairmanship of the Council’s committee on economic development. Three of his colleagues called on him to resign, but he has vowed to remain in office.

Thomas’ attorneys, Frederick Cooke and Seth Rosenthal, did not immediately return messages seeking comment. A call to Thomas’ Council office went straight to voicemail.

The U.S. attorney’s office for the district is aware of the search, said Bill Miller, a spokesman for the office. He declined to comment further because the investigation is ongoing.

Patrick Brown, a spokesman for the IRS criminal investigation division, said IRS agents were at Thomas’ home “on official business.” He declined to comment further.

Late Friday morning several agents wearing FBI jackets and vests were walking in and out of the front door and garage of Thomas’ two-story brick home in northeast Washington. Around 11:30 a.m. a tow-truck backed into Thomas’ driveway and FBI agents pulled a motorcycle out of his garage and secured it to the bed of the truck. One of his attorneys was also at the home.

Tim Day, a Republican who ran against Thomas and first alerted District authorities to irregularities with Thomas’ nonprofit, watched the search unfold and said he was pleased his complaint had led to a federal probe.

“Regardless of who you are, you can’t cheat taxpayers. You can’t cheat residents,” said Day, who is running for an at-large Council seat.

He repeated a previous call for Thomas to resign.

The money Thomas is accused of diverting was earmarked by the Council in 2007 for youth baseball programs. At Thomas’ direction, according to the lawsuit, much of that money was given as a grant to a nonprofit called the Langston 21st Century Foundation, which provides golf programs for youth. The foundation then paid most of the money to Team Thomas, a nonprofit established by the councilmember.

According to the lawsuit, Team Thomas did not spend the money on youth sports programs. Instead, the lawsuit said, it spent money on travel to Las Vegas, rounds of golf and mailings to Thomas’ constituents. Langston was also accused of diverting money to a for-profit company controlled by Thomas, which then paid for an Audi SUV that the councilmember used as his personal vehicle.

Federal authorities are also investigating the campaign activities of Mayor Vincent Gray and Council Chairman Kwame Brown. A minor mayoral candidate has accused Gray campaign staffers of giving him cash and promising him a job last year in exchange for negative comments about then-Mayor Adrian Fenty during campaign appearances. The mayor has denied wrongdoing. Brown, meanwhile, is under investigation for diverting about $200,000 in campaign funds to a firm controlled by his brother. He claims the money was used for legitimate campaign purposes.

The investigations have cast a cloud over district politics and led to low approval ratings for the mayor, who’s been in office since January. The Council is working on ethics reform legislation to address concerns from the public about rampant corruption.”

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

Federal Crimes – Be Careful

Federal Crimes – Be Proactive

Federal Crimes – Federal Indictment

Federal Crimes – Detention Hearing

Federal Mail Fraud Crimes

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To find additional federal criminal news, please read Federal Crimes Watch Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition and OFAC SDN Sanctions Removal.

The author of this blog is Douglas McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


Edward Schlacht Charged for Allegedly Hiring Illegal Aliens

November 29, 2011

U.S. Immigration and Customs Enforcement (ICE) on November 29, 2011 released the following:

“DETROIT — A manager at a specialty pallet and box manufacturing company in northwest Detroit was arrested Tuesday by agents with U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) on criminal charges of knowingly accepting false documentation in the course of hiring undocumented workers.

Edward Schlacht, 48, a supervisor at Grigg Box Company in Detroit, was taken into custody Tuesday morning without incident by ICE HSI special agents.

“Employers who evade the law not only fuel the demand that is responsible for much of the country’s illegal immigration, but their actions also hurt lawful workers who are seeking jobs in this challenging economy,” said Brian M. Moskowitz, special agent in charge of ICE HSI in Detroit. “Criminal prosecutions are just one of many tools HSI is using to reduce the demand for illegal employment and protect job opportunities for the nation’s lawful workforce.”

As part of the enforcement action, agents also executed a federal search warrant at the business seeking evidence in this ongoing investigation into the company’s hiring practices. Schlacht is charged in a criminal complaint with continuing to employ unauthorized aliens. The arrest is the culmination of an investigation that began in February when an ICE HSI audit of the company’s hiring records identified 35 employees who used suspected counterfeit documents to obtain their jobs.

According to the court documents, after ICE HSI notified the company about the suspicious documents, Grigg Box Company sent a written reply advising the employees in question had been terminated. Subsequently, investigators conducting surveillance of the premises, observed several of the “terminated” employees continuing to work at the company. Additionally, through the use confidential informants, ICE HSI special agents recorded Schlacht in the process of hiring two individuals who admitted their documents were counterfeit and had been purchased. This individual was later paid by Schlacht in the form of an official payroll check from the company.

Schlacht is expected to make an initial appearance in federal court Tuesday afternoon. The charges carry a maximum penalty of up to ten years in prison and a fine of up to $250,000.

Employers are required to complete and retain a Form I-9 for each individual they hire for employment in the United States. This form requires employers to review and record the individual’s identity and employment eligibility documents and determine whether the documents reasonably appear to be genuine and related to the individual. Additionally, an employer must ensure that the employee provides certain information regarding his or her eligibility to work on the Form I-9.

Nationally in Fiscal Year (FY) 2011, ICE:

  • Conducted 2,496 I-9 audits, up from 503 in FY 2008;
  • Initiated 3,291 worksite enforcement cases, up from 1,191 in FY 2008;
  • Criminally arrested 221 employers, up from 135 in FY 2008;
  • Issued 385 Final Orders for $10,463,987 in fines, up from 18 Final Orders for $675,209 in fines in FY 2008; and
  • Debarred 115 individuals and 97 businesses, compared to 0 individuals and 0 businesses in FY 2008.”
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    Douglas McNabb – McNabb Associates, P.C.’s
    Federal Criminal Defense Attorneys Videos:

    Federal Crimes – Be Careful

    Federal Crimes – Be Proactive

    Federal Crimes – Federal Indictment

    Federal Crimes – Detention Hearing

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    To find additional federal criminal news, please read Federal Crimes Watch Daily.

    Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition and OFAC SDN Sanctions Removal.

    The author of this blog is Douglas McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


Seven Krahl Construction Executives and Employees and Two Others Indicted in Alleged Billing Fraud and Kickback Scheme

November 14, 2011

The Federal Bureau of Investigation (FBI) on November 11, 2011 released the following:

“CHICAGO— The principal owner and six top executives and employees of a former general contractor, together with two former employees of client companies, were indicted for allegedly engaging in a fraudulent billing and kickback scheme. The seven defendants affiliated with the former contractor, Krahl Construction, allegedly caused losses of $9 million and $400,000 respectively to the two client companies, while the former employees of those firms allegedly received kickbacks valued at $645,000 and $119,500, respectively. All nine defendants were charged together in a 16-count indictment returned late yesterday by a federal grand jury, Patrick J. Fitzgerald, United States Attorney for the Northern District of Illinois, and Robert D. Grant, Special Agent in Charge of the Chicago Office of the Federal Bureau of Investigation, announced today.

Krahl Construction, which specialized in interior construction, closed its Chicago office at 322 S. Green St., in January 2010 after FBI agents executed a federal search warrant. The company also had an office in Denver.

The indictment alleges that between 2005 and 2009, certain defendants fraudulently inflated the cost of renovation projects performed by Krahl and caused the creation of false documents to support the inflated costs, resulting in overbilling at least $15 million to Company A, which suffered actual losses of at least $9 million, and losses of approximately $400,000 to Company B. At the same time, the two clients’ employees secretly used their positions to solicit and accept bribe/kickback payments and home improvements in exchange for favorable action to help Krahl obtain contracts with those companies, the indictment charges.

Company A is identified as a San Francisco-based real estate investment trust that hired Krahl to renovate portions of an eight-story building located at 350 E. Cermak, Chicago. Company B is identified as a property management firm located on Michigan Avenue, Chicago, that hired Krahl to develop commercial property in Bolingbrook known as the Tallgrass project.

Defendant John Paderta, 52, of Fontana, Wis., and formerly of Burr Ridge, the president of Krahl who owned approximately 85 percent of the company, was charged with one count of mail fraud. Also indicted were:

Thaddeus Stepniewski, 50, of Lisle and formerly of Lombard, Krahl’s chief financial officer, who was charged with 15 counts of mail and wire fraud;

Doug Harner, 47, of Chicago, Krahl’s executive vice president and part owner, who was also charged with 15 counts of mail and wire fraud;

Scott Mousel, 48, of New Orleans and formerly of Lisle, a Krahl project manager for two portions of the Cermak project, who was charged with five counts of mail fraud;

John Bak, 37, of Ringwood, Ill., also a Krahl project manager on portions of the Cermak project, who was charged with one count of mail fraud;

Heather Ellis, 34, of Midlothian, a Krahl project manager assistant on portions of the Cermak project, who was charged with one count of mail fraud;

Erin Scott, 36, of Clarendon Hills, also a Krahl project manager assistant on the Cermak project, who was charged with four counts of mail fraud;

Scott Solano, 40, of Burr Ridge, property manager for the Cermak building, first as an employee of Company C, which managed the building for Company A, and then, beginning in April 2009, as an employee of Company A, who was charged with one count of mail fraud; and

Timothy Scannell, 48, of Chicago, vice president of Company B, who managed a three-story office building and warehouse in Bolingbrook, known as the Tallgrass building, which Krahl was hired to remodel, and who was charged with one count of mail fraud.

Each defendant will be arraigned at a later date in U.S. District Court.

The indictment also seeks forfeiture from Paderta, Stepniewski and Harner of at least $9 million. Separately, it seeks forfeiture of approximately $645,000 from Solano, and approximately $119,500 from Scannell, representing the value of the bribes/kickbacks they each allegedly received.

The indictment alleges that certain defendants engaged in aspects of the scheme as follows:

  • budgets: during the budgeting phase of the Cermak projects, Paderta, Stepniewski, Harner, Mousel, Bak and Solano fraudulently identified and included fictitious costs to be added to the project budgets to generate additional profits for Krahl;
  • spreadsheets: Paderta, Stepniewski, Mousel, Bak, Ellis and others created financial spreadsheets to keep track of the fraud, identifying the actual amounts owed to subcontractors along with the inflated amounts that were billed by Krahl. Stepniewski reviewed those spreadsheets on a regular basis, and he and others manually input the inflated amounts into the accounting records;
  • sham companies: Paderta instructed Stepniewski to set up sham companies that could be used to fraudulently obtain payment from customers, and Stepniewski arranged for those companies to be incorporated, knowing that they would be shell corporations used for fraudulent billing purposes;
  • creation of false documents: Paderta, Stepniewski, Harner, Mousel, Bak, Ellis, Scott and others created documents containing false information to support the inflated prices being charged by Krahl. Those documents included fraudulent invoices, change orders, lien waivers, applications and certifications for payment, and numerous documents from the sham companies. Certain documents were created by cutting and pasting information and signatures. Some documents contained forged signatures and falsely notarized signatures. Krahl maintained two sets of files; one containing legitimate documents, and the other containing false and fraudulent documents;
  • inflated amounts: Paderta decided on the inflated amounts that should be added to certain invoices, and he gave Mousel, Bak and others that information. Mousel and Bak created inflated invoices or made handwritten changes on documents to inflate the charges and gave those documents to Stepniewski Ellis and Scott, who then created new documents using the inflated numbers. On some occasions, Harner told Mousel and Bak to inflate certain costs for Company A projects;
  • inflated bids: Paderta, Stepniewski, Harner, Mousel, Bak, Ellis, Scott and others inflated bids to support the overstated invoices that were submitted for payment. They also inflated bids in order to make it appear that certain sham companies had submitted lower bids, which justified awarding the work to the sham companies. Paderta gave Bak inflated amounts to include in certain bid proposals, which Bak did;
  • false documents to Company A: Paderta, Stepniewski, Harner, Mousel, Bak, Ellis, Scott, Solano and others caused false and fraudulent invoices to be submitted to Company A, as well as other false documents, resulting in over-billing of at least approximately $15 million. Paderta, Stepniewski and Harner received substantial salary and bonus payments as a result of the overstated charges paid by Company A to Krahl;
  • Company A’s request: in December 2009, in response to Company A’s request for documents pertaining to the Cermak projects, Paderta, Stepniewski, Mousel and Ellis provided to Company A copies of numerous false and fraudulent documents, which had previously been submitted to Company A, showing inflated and fictitious costs, knowing that they were false and fraudulent; and
  • Company B: Paderta, Stepniewski, Harner and others submitted false and fraudulent documents to Company B, including invoices, payment applications, and lien waivers, falsely representing that at least three of the sham companies—Harvey Glass, Everygreene Electric, and Great Lakes Illinois Supply—had provided services and materials. In fact, Paderta, Stepniewski and Harner knew that those sham companies had not provided such services or materials.

Regarding bribes and kickbacks, the indictment alleges that Solano solicited and accepted kickbacks from Krahl, including payments totaling approximately $520,000 and renovations on Solano’s home totaling approximately $125,000. The renovations included work on the basement, general repairs, new windows, and installation of a generator and new televisions. In exchange for the kickbacks, Solano promised to, and did, take favorable action on behalf of Krahl as requested and as opportunities arose, including helping Krahl obtain contracts from Company A, while Solano was employed at Company A and elsewhere.

Scannell allegedly solicited and accepted kickbacks from Krahl, including payments totaling approximately $100,000, as well as renovations on his home totaling approximately $19,500. In exchange for the kickbacks, Scannell promised to take favorable action on behalf of Krahl as requested and as opportunities arose, including agreeing to help Krahl obtain contracts from Company B, while Scannell was employed at Company B.

The government is being represented by Assistant U.S. Attorneys Stephen Heinze, Jacqueline Stern and John Kness.

Each count of mail and wire fraud carries a maximum penalty of 20 years in prison and a $250,000 fine, or a fine totaling twice the loss to any victim or twice the gain to the defendant, whichever is greater. If convicted, the Court must impose a reasonable sentence under federal sentencing statutes and the advisory United States Sentencing Guidelines.

The public is reminded that an indictment contains only charges and is not evidence of guilt. The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.”

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Douglas McNabb – McNabb Associates, P.C.’s
Federal Criminal Defense Attorneys Videos:

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To find additional federal criminal news, please read Federal Crimes Watch Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition and OFAC SDN Sanctions Removal.

The author of this blog is Douglas McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


Federal, State, and Local Authorities Arrest Six Alleged San Antonio-Based Texas Mexican Mafia Members

October 13, 2011

The Federal Bureau of Investigation (FBI) on October 13, 2011 released the following:

“United States Attorney Robert Pitman, FBI Special Agent in Charge Cory B. Nelson, and Texas Department of Public Safety Director Steve McCraw announced today that six San Antonio-based members and associates of the Texas Mexican Mafia (TMM) have been arrested based on two federal drug indictments.

Those arrested include:

  • 45-year-old Robert Carreno, Jr, (aka “Lil Bit”);
  • 39-year-old Tony Berlanga (aka “Tony”);
  • 46-year-old Gabriel Quiroz (aka “Biker”);
  • 48-year-old Guadalupe Ramos (aka “Lupio”);
  • 56-year-old Julio Villanueva (aka “Shorty Hawk”); and,
  • 63-year-old Teresa Alonzo (aka “Tia”).

Manuel Gonzales (aka “Speedy”), age 36, and Alexander Garza (aka “Animal”), age 35, were already in federal custody for a supervised release violation. Joseph Sanchez (aka “Cowboy”), age 41, and 20-year-old Santos Trevino (aka “Dedos,” “Beatles”) are currently in state custody on unrelated charges.

The first indictment, returned on October 5, 2011, and unsealed today, charges all of the defendants, with the exception of Teresa Alonso, with one count of conspiracy to distribute one kilogram or more of heroin. Upon conviction, the defendants face a minimum mandatory 10-year term of imprisonment, and a maximum of life in federal prison.

Officials allege that from December 1, 2009, to July 20, 2011, the defendants were responsible for the distribution of at least 48 kilograms of heroin, which the TMM sold for $750,000. Authorities believe Carreno holds the rank of “Free World General” of the TMM. Also, Carreno and Berlanga allegedly oversaw the transportation of the heroin from Laredo to San Antonio, for further distribution by TMM members.

The second indictment, also returned on October 5, 2011, charges Teresa Alonzo (aka “Tia”) with a conspiracy to distribute heroin, between December 1, 2009 and July 20, 2011. Upon conviction, she faces a maximum sentence of 20 years in federal prison.

In June 2011, Alonzo allegedly attempted to smuggle an ounce of heroin to TMM Vice President Benito Alonzo, while he was incarcerated in the Texas Department of Corrections. Also as part of the distribution conspiracy, Alonzo is accused of having accepted thousands of dollars as repayment to Benito Alonzo for monies loaned to purchase heroin. A federal search warrant executed at her residence in August 2011 resulted in the seizure of notebooks containing names and telephone numbers of TMM members, and correspondence from Benito Alonzo.

This investigation was conducted by the Federal Bureau of Investigation’s Safe Streets Task Force together with the Texas Department of Public Safety – Criminal Investigations Division, U.S. Immigration and Customs Enforcement (ICE), San Antonio Police Department, Bexar County District Attorney’s Office, New Braunfels Police Department, and the 81st Judicial District Attorney’s Office. The U.S. Marshals Service also assisted in making the arrests.

An indictment is merely a charge and should not be considered as evidence of guilt. The defendants are presumed innocent until proven guilty in a court of law.”

To find additional federal criminal news, please read Federal Crimes Watch Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition and OFAC SDN Sanctions Removal.

The author of this blog is Douglas McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


FBI Agents Executing Search Warrant at Solyndra

September 8, 2011

Mercury News on September 8, 2011 released the following:

“By Lisa Fernandez

Federal agents are executing a search warrant this morning at the Solyndra headquarters in Fremont, according to an FBI spokeswoman.

The search is part of a joint operation by the Federal Bureau of Investigation, Department of Energy and the Office of Inspector General, according to Julianne Sohn, a spokeswoman for the FBI.

The action by federal agents comes a week after the solar manufacturer abruptly closed, laying off 1,100 workers.

Sohn would not comment on the purpose of the search or for what they might be looking.

“Everything is under seal,” she said.

Solyndra spokesman Dave Miller said the search came as a surprise, but he emphasized the company is “fully cooperating” with federal officials. He said he did not know the purpose of the search, but he speculated it could have something to do with the $535 million in loan guarantees the Department of Energy awarded to Solyndra.

There are indications that the agents are in the process of interviewing Solyndra employees.

Miller said there is a “wind-down” team still working at the company’s facilities, including human resources, accounting and fabrication engineers shutting down equipment. There are about 100 employees still on the job this week, but that number will continue to decrease, he said.

Solyndra filed for Chapter 11 bankruptcy Tuesday in Delaware, saying it plans to seek a buyer.

Bloomberg reported that at the bankruptcy hearing, the company said it may have two bidders for the Fremont plant financed by the federal loan guarantees. The U.S. Energy Department is concerned that the potential buyer may buy and move the equipment and technology out of the country, Justice Department attorney Matthew Troy said in court Wednesday.

Agents began executing their search about 7:30 a.m., Sohn said. Most of the activity appears to be concentrated at the old Solyndra buildings located at 901 Page Ave., as agents wearing FBI vests and jackets are scurrying back and forth in one of the parking lots.

More agents arrived in SUVs at 8:40 a.m.”

To find additional federal criminal news, please read Federal Crimes Watch Daily.

Douglas McNabb and other members of the U.S. law firm practice and write and/or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition and OFAC SDN Sanctions Removal.

The author of this blog is Douglas McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.

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