FBI: “Former Executive at First Command Financial Services Pleads Guilty”

August 26, 2014

The Federal Bureau of Investigation (FBI) on August 25, 2014 released the following:

“FORT WORTH, TX—A former executive at First Command Financial Services, an investment advisor and financial planning firm located in Fort Worth, Texas, pleaded guilty this morning before U.S. District Judge Reed C. O’Connor to a felony offense stemming from a fraud scheme she ran while employed there, announced U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.

Redonda Russell, 66, of Fort Worth, pleaded guilty to a felony Information charging one count of wire fraud. She faces a maximum statutory penalty of 20 years in federal prison, a $250,000 fine, and restitution. She will remain on bond pending sentencing, which is set for December 8, 2014.

Russell worked for First Command for 22 years, before leaving the company in the spring of 2013. She is a registered Investment Advisory Representative and Broker-Dealer Agent. She is able to buy and sell securities, and she is authorized to give investment advice to clients. She is a Chartered Financial Consultant (ChFC), a designation she earned by completing a comprehensive course of financial education, examinations, and practical experience. Through First Command’s client database, Russell had access to clients’ personal identifying information (PII), investment/insurance account numbers, and balances for the account holder and beneficiaries.

According to plea documents filed in the case, beginning on approximately April 3, 2012, and continuing through April 18, 2013, Russell obtained PII for at least 18 First Command clients, eight of whom were deceased. Russell admitted using that information to forge, or otherwise present claims as the account holder, beneficiary, or legal representative of the account holder/beneficiary, to First Command’s affiliated investment and insurance partners to liquidate the targeted accounts.

Russell admitted that part of her scheme was to steal funds from inactive clients’ accounts, thus making the fraud harder to detect. She also targeted accounts that were maintained by First Command’s business partners that were part of an industry-standard, paperless signature program that eliminated the need for the verifying entity to send additional substantiating paperwork to the receiver. After Russell altered ownership/control of the targeted customers’ accounts, Russell sent a policy cancellation/disbursement form and W-9 tax withholding form and instructed the affiliated partner to either liquidate or take a loan against the targeted accounts.

Funds were subsequently wired into one of Russell’s 12 bank accounts or, if checks were mailed, Russell would endorse and deposit them. Checks were endorsed by Russell, Russell signing as her husband, Russell signing as her daughter-in-law, or an amalgam of signatures she used to perpetuate the scheme usually having the surname “Russell.”

Russell’s scheme resulted in the liquidation of more than $316,000 from First Command’s clients’ accounts.

The FBI investigated the case; Assistant U.S. Attorney Nancy Larson is in charge of the prosecution.”

More Information on Federal Wire Fraud Statutes, Jury Instructions, and Crimes
Federal Wire Fraud Crimes – 18 U.S.C. § 1343

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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

Federal Crimes – Appeal

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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.


A Texas Federal Grand Jury Has Indicted an Individual for Allegedly Aiming a Laser Pointer at an Aircraft

August 25, 2014

The Federal Bureau of Investigation (FBI) on August 22, 2014 released the following:

Former Garland, Texas Man Indicted for Aiming a Laser Pointer at an Aircraft

DALLAS—A federal grand jury has indicted Steven Alexander Chavez, Jr., 23, on one count of aiming a laser pointer at an aircraft, announced U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.

Today, special agents with the FBI arrested Chavez in Lubbock, Texas, where he had recently relocated from Garland, Texas.

According to the indictment, returned earlier this week in Dallas, on or about August 24, 2013, in the Dallas Division of the Northern District of Texas, Chavez knowingly aimed the beam of a laser pointer at a Texas Department of Public Safety (DPS) helicopter.

A federal indictment is an accusation by a grand jury and a defendant is entitled to the presumption of innocence unless proven guilty. If convicted, however, the maximum statutory penalty is five years in federal prison and a $250,000 fine.

The FBI, Texas DPS and Garland Police Department are investigating. Special Assistant U.S. Attorney Lara Burns is prosecuting.”

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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

Federal Crimes – Appeal

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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.


Christopher Stephens Charged in Federal Complaint Alleging He Made Threats to Blow Up Federal Courthouses

May 29, 2013

The Federal Bureau of Investigation (FBI) on May 28, 2013 released the following:

“DALLAS—Christopher Stephens, 34, appeared in federal court today in Wichita Falls, Texas, before U.S. Magistrate Judge Robert K. Roach on a criminal complaint related to several threats he allegedly made to blow up federal buildings in the Dallas-Fort Worth metroplex, announced U.S. Attorney Sarah R. Saldaña of the Northern District of Texas. Stephens, who resided at the North Texas State Hospital (NTSH) in Wichita Falls, was ordered detained, pending a probable cause and detention hearing that will be set at a later date and held before U.S. Magistrate Judge David L. Horan in federal court in Dallas.

According to the affidavit filed with the complaint, the Wichita Falls Police Department’s (WFPD) communications center received telephone calls, one on March 5, 2013, and one the following day, from a caller who identified himself as “Gerald Adams.” In those calls, the caller threatened to blow up the U.S. Courthouse in Dallas. During the second phone call, the communications operator asked the caller if he was located at the NTSH, and the caller said that he was.

Law enforcement contacted an individual with a similar name who resided at the NTSH; however, it was determined that this individual was not the one who made the telephonic bomb threats. This individual stated that he believed the caller was another resident of NTSH, Christopher Stephens. He explained that Stephens became fascinated with his ex-wife, who had visited on several occasions and that Stephens had alluded to making contact with her upon his release. The individual believed that Stephens used his name to sabotage his release date.

On March 7, 2013, the WFPD’s communication center received a third bomb threat. During that call, Stephens advised that a bomb had been planted at the U.S. Courthouse in Fort Worth. The operator kept Stephens on the line long enough for WFPD officers to go to NTSH and observe Stephens on the phone speaking with the WFPD. Stephens did not deny making the bomb threat.

NTSH provided the officers with letters from Stephens. One letter was addressed to a WFPD officer and one was addressed to the FBI. Both letters provided a detailed description of how Stephens would blow up a federal courthouse, what materials he would use to make the bomb and how it would detonate. Stephens also wrote racial comments in the letter and included Nazi SS symbols.

On March 25, 2013, the FBI Dallas Field Division received a letter, via the U.S. Postal Service, signed by Stephens. That letter read, “I will blow up the Federal Courthouse in Fort Worth, Texas.” On April 3, 2013, the WFPD received a mailed bomb threat from Stephens that mirrored the one sent earlier to the FBI, with the exception that the letter depicted three Nazi Swastikas and the words “White Power.”

A federal complaint is a written statement of the essential facts of the offense charged and must be made under oath before a magistrate judge. A defendant is entitled to the presumption of innocence until proven guilty. The U.S. Attorney’s office has 30 days to present the matter to a grand jury for indictment. Stephens is charged with one count of using to the mail to willfully make a threat to unlawfully damage or destroy a federal courthouse by means of an explosive. That offense as charged carries a maximum statutory penalty 10 years in federal prison and a $250,000 fine, per count.

The matter is being investigated by the FBI and the WFPD. Assistant U.S. Attorney Kate Pfeifle and Deputy Criminal Chief Assistant U.S. Attorney Gary Tromblay are prosecuting.”

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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 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.


“Inmate Charged in Murder-for-Hire Plot Against Federal Judge”

May 16, 2013

The Federal Bureau of Investigation (FBI) on May 15, 2013 released the following:

“FORT WORTH, TX— Phillip Monroe Ballard, 71, has been charged with murder for hire, United States Attorney Kenneth Magidson of the Southern District of Texas announced today.

The indictment, returned just a short time ago, alleges Ballard solicited the murder for hire of a U.S. District Judge in the Northern District of Texas.

Ballard, currently in federal custody on unrelated charges in the Northern District of Texas, will remain in custody pending further criminal proceedings in this case. He is expected to appear before a U.S. Magistrate Judge in Fort Worth in the near future.

If convicted, Ballard faces up to 20 years in prison and a $250,000 fine.

The case is being investigated by the FBI. Assistant U.S. Attorneys Mark McIntyre and Craig Feazel are prosecuting the case.

An indictment is a formal accusation of criminal conduct, not evidence. A defendant is presumed innocent unless convicted through due process of law.”

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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.


FBI Says Cartel Used Bank of America to Launder Money

July 9, 2012

Bloomberg Business Week on July 9, 2012 released the following:

“By Joe Schneider

The brother of the alleged leader of a Mexican cocaine-trafficking cartel used Bank of America Corp. (BAC) accounts to invest the organization’s drug proceeds in U.S. racehorses, a FBI agent said.

Jose Trevino-Morales, one of 14 people indicted by a federal grand jury in Texas on June 12, used a personal account and a business account under the name of Tremor Enterprises LLC to buy and sell horses using money generated from cocaine trafficking, extortion and bribery, Jason Preece, a special agent with the Federal Bureau of Investigation, said in a June 11 sworn statement filed in federal court in Dallas.

“The ultimate goal of this money laundering operation was to provide Jose Trevino with apparent legitimate assets purchased and maintained by illegally obtained money,” Preece said. Bank of America isn’t accused of any wrongdoing in the agent’s statement.

Details of the transactions were revealed in a probe of the Los Zetas drug cartel, which according to the filing, funnels thousands of kilograms of cocaine into the U.S. each year. Los Zetas is the biggest drug cartel in Mexico, in geographical presence, and controls 11 states in the country, generating millions of dollars of revenue, Preece said in the statement filed in a bid to gain a search warrant for Trevino’s property.

Strong Procedures
“We have strong anti-money-laundering procedures and work closely with the authorities when suspicious activity is discovered,” Larry Di Rita, a spokesman at Charlotte, North Carolina-based Bank of America, said in a phone interview today.

The bank doesn’t comment on any specific legal and customer cases, he said.

Preece filed the statement to support his request for court permission to search Trevino’s property in Balch Springs, Texas, a Dallas suburb, where he said investigators were likely to find horse ownership records, bank statements and cellular phones used to communicate with Los Zetas.

Trevino, who earned $29,000 in 2009 from Texas Stone and Tile LLC, had expenses of $200,000 a month the following year to support his horses, according to an FBI informant who isn’t named in the filing. The drug cartel had bought at least $4.2 million worth of quarter horses, which are used in short- distance races, over a four-year period, according to the indictment.

The two most well-known horses Trevino had were Tempting Dash and Mr. Piloto, according to the filing.

Mr. Piloto won the All American Futurity race in 2010 at Ruidoso Downs Race Track, with Tremor Enterprises’ bank account being credited with $968,440 as a result, Preece said.

Miguel Angel Trevino Morales, 38, leader of the Los Zetas drug cartel, and his brother Oscar Omar Trevino Morales were also indicted by the grand jury.

The defendants are charged in the May 30 indictment with conspiracy to launder monetary instruments. The crime carries a maximum penalty of 20 years in prison.

The criminal case is U.S. v. Morales, A-12-cr-210-SS, U.S. District Court, Western District of Texas (San Antonio). The application and affidavit for search warrant is 3:12-mj-255, U.S. District Court, Northern District of Texas (Dallas.)”

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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.


JetBlue Pilot Charged with Alleged Interference with a Flight Crew

March 29, 2012

The Federal Bureau of Investigation (FBI) on March 28, 2012 released the following:

“AMARILLO, TX—A federal criminal complaint was filed in the Northern District of Texas today that charges JetBlue pilot Clayton Frederick Osbon, 49, with interference with a flight crew, announced U.S. Attorney for the Northern District of Texas Sarah R. Saldaña.

According to the affidavit filed with the complaint, Osbon, a pilot working JetBlue Flight 191 from New York’s John F. Kennedy (JFK) Airport to Las Vegas, according to witnesses, arrived at JFK later than he should have for the flight and missed the crew briefing. As the plane was leaving JFK and climbing in altitude in its scheduled five-hour flight, Osbon said something to the first officer (FO) about being evaluated by someone, but the FO did not know what he meant. Osbon then talked about his church and the need to “focus” and asked the FO to take the controls and work the radios. Osbon began talking about religion, but, according to the FO, his statements were not coherent.

The affidavit goes on to say that the FO became concerned when Osbon said “things just don’t matter.” According to the FO, Osbon yelled over the radio to air traffic control and instructed them to be quiet. Osbon turned off the radios in the aircraft, dimmed his monitors, and sternly admonished the FO for trying to talk on the radio. When Osbon said “we need to take a leap of faith,” the FO stated that he became very worried. Osbon told the FO that “we’re not going to Vegas” and began giving what the FO described as a sermon.

The affidavit states that the FO suggested to Osbon that they invite the off-duty JetBlue captain who was on board the flight into the cockpit; however, Osbon abruptly left the cockpit to go to the forward lavatory, alarming the rest of the flight crew when he didn’t follow the company’s protocol for leaving the cockpit. When flight attendants met Osbon and asked him what was wrong, he became aggressive and banged on the door of the occupied lavatory, saying he needed to get inside.

While Osbon was in the lavatory, at the request of the FO, a flight attendant brought the off-duty captain to the cockpit, where he assisted the FO with the remainder of the flight. When Osbon exited the lavatory, he began talking to flight attendants, mentioning “150 souls on board.” Osbon walked to the rear of the aircraft but along the way stopped and asked a male passenger if he had a problem. Osbon then sprinted back to the forward galley and tried to enter his code to re-enter the cockpit. When the FO announced over the public address system an order to restrain Osbon, several passengers assisted and brought Osbon down in the forward galley, where he continued to yell comments about Jesus, September 11, Iraq, Iran, and terrorists.

The FO declared an emergency and diverted the aircraft to Amarillo, landing with passengers still restraining Osbon in the galley. Osbon was removed from the aircraft and taken to a facility in the Northwest Texas Healthcare System in Amarillo for medical evaluation, where he remains.

A federal complaint is a written statement of the essential facts of the offenses charged and must be made under oath before a magistrate judge. A defendant is entitled to the presumption of innocence until proven guilty. The maximum penalty, upon conviction, for interference with a flight crew is a 20 years in prison and a $250,000 fine. The U.S. Attorney’s Office for the Northern District of Texas has 30 days to present the matter to a grand jury for indictment.

The ongoing investigation is being led by the FBI with the assistance of JetBlue, the Federal Aviation Administration, the Transportation Security Administration, the National Transportation Safety Board, the Amarillo Police Department, and the Rick Husband Amarillo International Airport Police Department.

Assistant U.S. Attorney Christy L. Drake, of the U.S. Attorney’s Office in Amarillo, is in charge of the prosecution.”

Clayton Osbon – Federal Criminal Complaint

49 U.S.C. § 46504

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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 C. McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.


“Rockwall Doctor Charged In Biggest U.S. Healthcare Fraud Ever”

February 28, 2012

CBS DFW on February 28, 2012 released the following:

“ROCKWALL (CBSDFW.COM) – A North Texas doctor has been arrested and charged in what’s being described as the largest healthcare fraud case in U.S. history.

Between January, 2006 and November of last year, Dr. Jacques Roy is accused of cheating Medicare and Medicaid, and ultimately taxpayers, nearly $380 million dollars.

Top U.S. Justice department officials have flown to Dallas Tuesday to make the announcement along with the U.S. Attorney for the Northern District of Texas, and the Special Agent in charge of the Dallas FBI, Robert Casey.

Roy will make an appearance in federal court Tuesday afternoon.

Six other people have also been indicted in the massive fraud case. They include Dr. Roy’s office manager Teri Sivils, and the owners of North Texas home health care agencies.

CBS 11 cameras were rolling last June 2nd, when agents from the FBI and the Office of Health and Humans Services Inspector General executed search warrants at Roy’s Rockwall house and at one of the healthcare agencies, Charry Home Care Services in Dallas.

These other six defendants will appear today before a judge in federal court as well.

As of this writing at 1:08 p.m. on February 28, Roy’s Texas medical license is still active. However, the Texas Medical Board typically suspends the licenses of doctors who are charged with felonies.”

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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.


Nearly 40 Members and Associates of Bandido Outlaw Motorcycle Gang Charged in Three Districts for Alleged Drug and Firearm Offenses

September 28, 2011

The Federal Bureau of Investigation (FBI) on September 27, 2011 released the following:

“WASHINGTON— Nearly 40 members and associates of the Bandido Outlaw Motorcycle Gang (BOMG) were arrested yesterday and today on various firearms and drug-related charges in three judicial districts as part of a coordinated law enforcement effort, announced the Department of Justice and the FBI.

Twenty-eight individuals were charged in the Northern District of Texas in six complaints unsealed today in Dallas with conspiracy to possess and to distribute heroin, methamphetamine and cocaine. One of the defendants was charged with possession of a machine gun. All of the defendants were arrested around the Dallas area, except for one individual, who was arrested in San Francisco today. The defendants will make initial appearances tomorrow in U.S. federal court.

In addition, eight individuals who are members or associates of the BOMG were charged in the District of Colorado with conspiracy and knowingly possessing with intent to distribute 50 grams or more of methamphetamine and five kilograms or more of cocaine. Six of the individuals were arrested today in the Denver area, while one defendant was already in state custody and one is at large. According to court documents filed in U.S. District Court in Denver, the BOMG is a self styled “outlaw” motorcycle organization comprised of more than 2,000 members and associates with more than 90 chapters in the United States, Canada, Europe, and elsewhere.

Yesterday, FBI agents and local authorities arrested three San Antonio residents in the Western District of Texas as part of the coordinated takedown. San Antonio BOMG Sergeant-At-Arms Gerardo Gomez Jr., 29, aka “Bandido Junior Ray;” San Antonio BOMG member Jason Earl Morris, 33, aka “Sarge;” and Angel Cevallos, 40, were arrested on one charged count of possession with intent to distribute more than 500 grams of cocaine. According to the complaint and supporting affidavit filed in San Antonio, yesterday the defendants were engaged in a drug transaction with undercover agents in which the defendants agreed to sell five kilograms of cocaine for $100,000. The three defendants were arrested by FBI agents after initially fleeing the scene by car. They remain in federal custody.

Indictments and complaints are merely charging documents. Defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

The charge of possession with intent to distribute more than 500 grams of cocaine carries a mandatory minimum prison sentence of five years and a maximum prison sentence of 40 years, as well as a maximum $5 million fine. The charge of possessing a machine gun carries a maximum penalty of 10 years in prison and a $250,000 fine. If convicted of knowingly possessing with intent to distribute methamphetamine or cocaine, those defendants face a mandatory minimum prison term of 10 years, and a maximum of life in federal prison, as well as up to a $4 million fine.

The Dallas charges are the result of a multi-year investigation into the illicit distribution of drugs and firearms by the BOMG and its affiliated support clubs. The investigation was led by the FBI and the Drug Enforcement Administration (DEA).

The Colorado case is being investigated by the FBI and the Denver Metro Gang Task Force.

The San Antonio case is being investigated by the FBI; the DEA; the Bureau of Alcohol, Tobacco, Firearms, and Explosives; the Texas Department of Public Safety, the Arlington, Texas, Police Department; the Austin, Texas, Police Department; and the Fort Worth, Texas, Police Department. The San Antonio Police Department also assisted in yesterday’s arrests.

The cases are being prosecuted by Assistant U.S. Attorneys from the Northern District of Texas, the Western District of Texas and the District of Colorado.”

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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Medicare Fraud Strike Force Charges 91 Individuals for Approximately $295 Million in False Billing

September 7, 2011

The Federal Bureau of Investigation (FBI) on September 7, 2011 released the following:

“WASHINGTON— Attorney General Eric Holder and Health and Human Services (HHS) Secretary Kathleen Sebelius announced today that a nationwide takedown by Medicare Fraud Strike Force operations in eight cities has resulted in charges against 91 defendants, including doctors, nurses, and other medical professionals, for their alleged participation in Medicare fraud schemes involving approximately $295 million in false billing.

Attorney General Holder and Secretary Sebelius were joined in the announcement by FBI Executive Assistant Director Shawn Henry, Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division, and HHS Inspector General Daniel R. Levinson.

As part of a coordinated action, 70 individuals were charged by Strike Force prosecutors in indictments unsealed yesterday and today in six cities alleging a variety of Medicare fraud schemes involving approximately $263.6 million in false billings. As part of takedown operations last week, 18 additional defendants were charged in Detroit and one defendant was charged in Miami in cases unsealed on Sept. 1, 2011, for their alleged roles in Medicare fraud schemes involving approximately $29.4 million in fraudulent claims. Additionally, two individuals are scheduled to appear in court today on charges filed on Aug. 24, 2011, for their roles in a separate $2 million health care fraud scheme. This coordinated takedown involved the highest amount of false Medicare billings in a single takedown in Strike Force history.

The joint Department of Justice-HHS Medicare Fraud Strike Force is a multi-agency team of federal, state, and local investigators designed to combat Medicare fraud through the use of Medicare data analysis techniques and an increased focus on community policing. Over the course of the past week, approximately 400 law enforcement agents from the FBI, HHS-Office of Inspector General (HHS-OIG), multiple Medicaid Fraud Control Units, and other state and local law enforcement agencies participated in the takedown. In addition to making arrests, agents also executed 18 search warrants in connection with ongoing strike force investigations.

“The defendants charged in this takedown are accused of stealing precious taxpayer resources and defrauding Medicare – jeopardizing the integrity of our health care system and our nation’s most critical health care program for personal gain,” said Attorney General Holder. “Our highly coordinated, nationwide Strike Force operations are working aggressively to combat Medicare fraud and our anti-health care fraud efforts have never been more innovative, collaborative, aggressive – or effective. We will continue to work with our law enforcement partners and partners across government to fight against health care fraud.”

“Today’s arrests are a powerful warning to those who would try to defraud taxpayers and Medicare beneficiaries,” said HHS Secretary Sebelius. “These arrests illustrate close cooperation between the Medicare program that identified these fraudsters and the law enforcement officials who acted swiftly to cut them off. And our efforts to stop criminals don’t end here because the Affordable Care Act gives us new tools to prevent Medicare fraud before it is committed – better protecting seniors and the integrity of the Medicare program for generations to come.”

The defendants charged are accused of various health care fraud-related crimes, including conspiracy to defraud the Medicare program, health care fraud, violations of the anti-kickback statutes and money laundering. The charges are based on a variety of alleged fraud schemes involving various medical treatments and services such as home health care, physical and occupational therapy, mental health services, psychotherapy, and durable medical equipment (DME).

According to court documents, the defendants allegedly participated in schemes to submit claims to Medicare for treatments that were medically unnecessary and oftentimes never provided. In many cases, indictments and complaints allege that patient recruiters, Medicare beneficiaries and other co-conspirators were paid cash kickbacks in return for supplying beneficiary information to providers, so that the providers could submit fraudulent billing to Medicare for services that were medically unnecessary or never provided. Collectively, the doctors, nurses, medical professionals, health care company owners and others charged in the indictments and complaints are accused of conspiring to submit a total of approximately $295 million in fraudulent billing.

“The health care system is part of our nation’s infrastructure and we must do everything in our power to protect the integrity of Medicare and the system at large,” said FBI Executive Assistant Director Henry. “Working together as partners, we can stop criminals who seek to steal American taxpayers’ hard-earned dollars and we help ensure our nation’s health care system is there for those who need it.”

“As charged in these indictments, the defendants cover nearly the entire spectrum of health care providers, and perpetrated a variety of fraudulent schemes,” said Assistant Attorney General Breuer. “From Brooklyn to Miami to Los Angeles, the defendants allegedly treated the Medicare program like a personal piggy bank. Today’s Strike Force operations should serve as a wake-up call to would-be fraudsters nationwide. With Strike Force teams now in nine cities across the country, and employing sophisticated, data-driven law enforcement methods, we are determined to hold criminally responsible those who defraud Medicare.”

“The warning should be unambiguously clear by now,” said HHS Inspector General Levinson. “We will continue using the combined law enforcement might of Strike Forces around the country to combat health care fraud.”

In Miami, 45 defendants, including one doctor and one nurse, were charged today and yesterday for their participation in various fraud schemes involving a total of $159 million in false billings for home health care, mental health services, occupational and physical therapy, DME, and HIV infusion. Another defendant in Miami was charged on Sept. 1, 2011, for a $1 million Medicare fraud scheme. In one case, 24 defendants are charged for participating in a community mental health center fraud scheme involving more than $50 million in fraudulent billing. According to court documents, the defendants allegedly paid patient recruiters to refer ineligible beneficiaries to the mental health center. In some instances, beneficiaries who were residents of halfway houses were allegedly threatened with eviction if they did not agree to attend the mental health center.

In Houston, two individuals were charged today with fraud schemes involving $62 million in false billings for home health care and DME. According to an indictment, one defendant allegedly sold beneficiary information to 100 different Houston-area home health care agencies in exchange for illegal payments. The indictment alleges that the home agencies then used the beneficiary information to bill Medicare for services that were unnecessary or never provided.

Ten defendants were charged in Baton Rouge, La., for participating in schemes involving more than $24 million related to false claims for home health care and DME. According to one indictment, a doctor, nurse, and five other co-conspirators participated in a scheme to bill Medicare for more than $19 million in skilled nursing and other home health services that were medically unnecessary or never provided.

Six defendants, including two doctors, were charged in Los Angeles for their roles in schemes to defraud Medicare of more than $10.7 million. In Brooklyn, three defendants, including two doctors, were charged for a fraud scheme involving more than $3.4 million in false claims for medically unnecessary physical therapy. Two defendants, including a doctor, are making initial appearances today in U.S. federal court in Dallas after being charged for a scheme to defraud Medicare of approximately $2.1 million.

In Detroit, 18 defendants, including three doctors, were charged last week for schemes to defraud Medicare of more than $28 million. According to an indictment, 14 of the defendants participated in a home health care scheme that submitted more than $14 million in false claims to Medicare.

Finally, four defendants including one doctor, were charged in Chicago for their alleged roles in schemes to defraud Medicare of more than $4.4 million.

The Medicare Fraud Strike Force operations are part of the Health Care Fraud Prevention & Enforcement Action Team (HEAT), a joint initiative announced in May 2009 between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country.

Since their inception in March 2007, Strike Force operations in nine locations have charged more than 1,140 defendants who collectively have falsely billed the Medicare program for more than $2.9 billion. In addition, the HHS Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

The cases announced today are being prosecuted and investigated by Medicare Fraud Strike Force teams comprised of attorneys from the Fraud Section of the Justice Department’s Criminal Division and from the U.S. Attorney’s Offices for the Southern District of Florida, the Eastern District of Michigan, the Eastern District of New York, the Southern District of Texas, the Central District of California, the Middle District of Louisiana; the Northern District of Illinois, and the Northern District of Texas; and agents from the FBI, HHS-OIG, and state Medicaid Fraud Control Units.

An indictment is merely a charge and defendants are presumed innocent until proven guilty.”

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 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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Kenneth Wayne Brown, Duane Milford Stailey, and Sharon Ware Stailey are Indicted by a Dallas Federal Grand Jury and Are Each Charged Conspiracy to Commit Theft From a Program Receiving Federal Funds

August 25, 2011

The U.S. Attorney’s Office Northern District of Texas on August 24, 2011 released the following:

“FEDERAL GRAND JURY INDICTS ADDITIONAL DEFENDANTS FOR ROLE IN CONSPIRACY TO EMBEZZLE FROM CITY OF GARLAND, TEXAS

Former City of Garland Employee, Patricia Leathers, is Currently Serving a 57-Month Prison Sentence for Her Role in the Conspiracy

DALLAS — A federal grand jury in Dallas has indicted three defendants for their role in a conspiracy to embezzle from the City of Garland, Texas, announced U.S. Attorney James T. Jacks of the Northern District of Texas. Kenneth Wayne Brown, 50, of Denison, Texas; Duane Milford Stailey, 44, and his wife, Sharon Ware Stailey, 45, both of Leonard, Texas, are each charged with one count of conspiracy to commit theft from a program receiving federal funds.

Patricia Leathers, 63, of Rowlett, Texas, a former risk management adjustor for the City of Garland, pleaded guilty in December 2010 to the same offense. She is presently serving a 57-month sentence at the Federal Medical Center Carswell in Fort Worth, Texas. Leathers was also ordered to pay $1,968,479 in restitution to the City of Garland. Leathers’ sister, Connie M. Powell, 60, of Garland, also pleaded guilty to her role in the conspiracy. She was sentenced to a three-year term of probation and ordered to pay $64,142 in restitution.

The indictment alleges that from August 1999 through March 2008, the three defendants conspired with each other and others to embezzle from the City of Garland by creating false claims for damage and repairs to personal and real property. The reimbursement checks, issued in the true names of the defendants, as well as fictitious names, were cashed by the defendants who then shared the proceeds with Leathers.

According to the indictment, Brown endorsed and negotiated at least 14 City of Garland checks, totaling more than $102,000. In addition, Duane and Sharon Stailey fraudulently negotiated and shared in the proceeds of City of Garland checks totaling at least $482,000 of which they deposited more than $129,000 into their joint bank account.

An indictment is an accusation by a federal grand jury, and a defendant is entitled to the presumption of innocence unless proven guilty. However, if convicted, each face a maximum statutory sentence of five years in prison and a $250,000 fine. Restitution could be ordered.

The investigation was conducted by the FBI, the Garland Police Department, and the Garland Offices of the City Attorney and Internal Auditor. Assistant U.S. Attorney Katherine Miller is prosecuting the case.”

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 extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition and OFAC SDN List 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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