Prattville Man Convicted of Sex Trafficking of a Minor

Source: United States Attorneys General

Headline: Prattville Man Convicted of Sex Trafficking of a Minor

       Montgomery, Alabama – On Thursday, February 8, 2018, Michael Graham Lowe, 25, of Prattville, Alabama, was found guilty by a federal jury of sex trafficking of a minor and conspiracy to commit sex trafficking, announced United States Attorney Louis V. Franklin Sr.

       Previously, a federal grand jury returned an indictment against Lowe and his co-defendant, Joshua David Rose, after hearing evidence that the two recruited, enticed, and transported a minor victim knowing that the victim was under the age of 18 years and would be engaging in a commercial sex act.  Joshua Rose, 29, also from Prattville, pled guilty to sex trafficking of a minor in August 2017.

       According to evidence presented at the four-day trial, Lowe was friends with the 17-year-old minor victim and in May 2016, he introduced the victim to co-defendant Rose at a motel in Montgomery.  On May 24 and 25, 2016, Rose took photographs of the victim and placed an ad on the classified advertising website Backpage.com.  Lowe and Rose transported the minor victim to perform commercial sex acts in Montgomery and the surrounding areas and stood guard outside during the acts.  Rose and Lowe used the money earned by the minor victim to purchase illegal narcotics.  On May 26, 2016, the victim became upset and refused to perform further commercial sex acts.  Lowe then transported the victim from the motel leaving her at a local residence.  After hearing the evidence presented at trial, the jury found Lowe guilty of both counts in the federal indictment.

       For the sex trafficking of a minor charge, Lowe faces a minimum of 10 years and a maximum of life in prison.  For the conspiracy to commit sex trafficking, Lowe faces up to life in prison.  Lowe is in the custody of the United States Marshals Service pending a sentencing hearing, which has not yet been scheduled.

       “These human traffickers prostituted a child in order to have the money to feed their drug habit,” stated U.S. Attorney Franklin.  “We will not allow the children of this District to be preyed-upon, prostituted and used by predators.  This office will continue to use all resources necessary to take these criminals off the streets and ensure the safety of our children.”  

       “The Prattville Police Department is very thankful for the working relationship we have with the U.S Attorney’s Office and all the agencies involved in this case,” stated Prattville Police Chief Mark Thompson.  “This should send a strong message to the criminal element committing these types of crime that we will find them and put them away. We are very proud of our Criminal Intelligent Unit for the effort put into this case. It shows that the Prattville PD is proactive and we will continue to develop better ways to combat crime.” 

       “Human trafficking is a horrific crime that traps its victims in a life of misery and abuse,” said Attorney General Steve Marshall. “This conviction is the result of a long and painstaking investigation by agents and officers who cared deeply about the harm being caused to the young victim, and were determined to stop this from happening to her and to others. I am thankful for the diligence of the Prattville Police Department, which initiated this case, working with agents of the Alabama Attorney General’s Office and the U.S. Department of Homeland Security and assisted by the Montgomery Police Department. I also want to thank the U.S. Attorney’s Office for its successful prosecution to bring this criminal to justice.  As Alabama’s Attorney General, I am committed to continue this kind of cooperative and dedicated teamwork among agencies, which is the key to making our state a safer place.”

       “HSI will tirelessly work to investigate and bring to justice anyone who thinks they can get away with preying upon our children for their sexual gratification,” said Homeland Security Investigations Acting Special Agent in Charge Thomas M. Annello. “This case highlights the exceptional commitment and devotion of the men and women who pursue the perpetrators of these depraved crimes every day.”

       This case was jointly investigated by U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, the Prattville Police Department, and the Alabama Attorney General’s Office, with assistance from the United States Marshal’s Service and Montgomery Police Department. 

       The case was prosecuted by Assistant U.S. Attorney Hollie Worley Reed of the Middle District of Alabama and Trial Attorney Leslie Williams Fisher of the Criminal Division’s Child Exploitation and Obscenity Section.

Attorney General Sessions Delivers Remarks At The Abraham Lincoln Foundation Of The Union League Of Philadelphia’s Annual Lincoln Day Celebration

Source: United States Department of Justice

Headline: Attorney General Sessions Delivers Remarks At The Abraham Lincoln Foundation Of The Union League Of Philadelphia’s Annual Lincoln Day Celebration

Remarks as prepared for delivery.

Thank you, Greg, for that kind introduction, for your leadership at the Union League, and for the good work you’ve done for the Philadelphia Police Foundation.  Thank you for doing your part to help our men and women in blue.

I also want to thank Ed for emceeing today, Joan Carter for organizing today’s festivities, and Jim Dunigan for his leadership, as well.

I want to recognize Frank and Dotty Giordano and their son John, a former DOJ attorney and Trump administration alumnus. 

And I also want to recognize Ezra Cohen-Watnick, another Trump White House veteran from the National Security Council team.

This is a big crowd.  For a minute there, I was wondering if this was the residue of the Eagles’ Super Bowl parade. It’s bigger than the Crimson Tide’s celebration, of course, but it’s less unusual for the Tide.

Thank you to the Union League for all of the work that you do to educate our young people about the Constitution, our legal traditions, history, and about the importance of good citizenship.

I’m reading a book about our 21st President, Chester Alan Arthur, who was a proud Union League member in New York.  I’m sure there are a lot of big Chet Arthur fans with us today.

The biography has this line: “Arthur’s college education and membership in the prestigious Union League Club distinguished him from… less sophisticated party hacks.” Certainly, yours is a sophisticated and prestigious institution. 

My only previous visit to this club was during the 2004 Republican convention. I was then and am now most impressed how the structure itself radiates order, confidence in the future by its founders, along with beauty and good taste.

So you can know that I was honored and humbled by your invitation to receive the Lincoln Award—especially considering some who have received it before, like my former boss Pennsylvania Governor and U.S. Attorney General Dick Thornburgh, Justices Thomas and Alito—truly great justices— and many others. I am truly honored.

Philadelphia is a great city, whose prosperity, health and public safety is as important to America today as it has been for two centuries.

Indeed there hangs in my house in Mobile today a document produced 174 years ago in Philadelphia. It’s my great, great grandfather Herndon’s 1844 sheepskin diploma from the University of Pennsylvania Medical School. Philadelphia, I believe, at the time was the center for medical training in America. History is important, and beneficial to our present and future if we deal with it honestly. Dr Herndon, a native of Fredericksburg, Virginia, soon after graduation moved to Alabama, and became part of the confederate army as a surgeon and surely did his best to save Confederate soldiers no doubt shot by Union soldiers in that war.

Chet Arthur was married to Ellen Herndon, Dr. Herndon’s niece, and during the war, he referred to her as “my little rebel”. 

I remain pretty sure you have not presented the Lincoln Award to anyone named Jefferson Beauregard Sessions III before, especially since the original name, lore has it, fell on a baby born the day Jefferson Davis was sworn in as president of the Confederate States of America nearby in Montgomery.

The baby’s father enlisted, as his saw his duty, as a private and met his demise at Antietam—a mini ball to the head. He left a widow with a baby to marry “old man Henry”, as my father described him. Old man Henry was 27 years older than she but had a place with about 250 acres of farmable land. Daddy said once, “He was good to her.” That farm has fallen to me. Life presents many twists and turns- does it not?

Did you see the article in the last few days in which experts say one of the best things you can do for children is to tell them the story of their family- as tales of the happy and sad times give them confidence to endure? The message: the family has had tough times but got through them. Your educational mission is surely important in that sense also. We must be intentional about training children and not turn that mission into talking heads or post-modern faculty.

Thoughtful people know why we have Union League clubs and how the cataclysm happened— but I fear too few. The thing was brewing from the beginning of the Republic. Though many Southerners try to say otherwise—and I love my people—slavery was the cause of the war. It was not states’ rights or tariffs or agrarian versus industrial economies. Those issues were all solvable and would have been solved. The cloud, the stain of human bondage—the buying and selling of human beings—was the unsolvable problem and was omnipresent from the beginning of the country.

And the failure, the refusal of the South to come to grips with it—really to actually change this immoral system of enslavement—led to the explosion.

As to slavery, it had to end. The nation could stand the disgrace no longer. And Lincoln came. And the war came. Lincoln’s moral and legal clarity, like that of Dr. Martin Luther King Junior’s a century later, produced the will, the power, which sustained the war and propelled the nation to union and emancipation. This was a monumental conflict indeed.

The conflagration was intimate, brutal, and not short.

It is fair to say Lincoln did not start the war. He inherited it, and through extraordinary determination, eloquence, judgment, and courage, he finished it. His magnificent soldiers fighting other magnificent soldiers fought it out over four years, deciding the fate of the nation. The enslaved people of the South were emancipated and that by military victory. They venerated Father Abraham for it.

The Union was preserved—the unwavering vision to which Lincoln was dedicated. The Constitution was preserved.

This was an event the world watched in amazement and it changed the world. And, Lincoln did the thing with resolution, with ferocity, to complete victory. And all the while maintaining and projecting a spirit of humanity, grace, and humility—to a degree never before found, I think, in any wartime leader.

This spirit played a key role in the process of reconciliation. It would be a mistake to say Lincoln’s magnanimous spirit quickly healed all the war’s wounds. But that spirit was foundational.

Successful reconciliations— as history, maturity, and judgement tell us— do not happen overnight. In many places around the globe that I have visited, wars seem never to be forgotten. A thousand year old grievance is as fresh as yesterday.

The American, dare I say, the Christian value of forgiveness, embodied in the Lincoln spirit has blessed us all. This spirit has been on display after all our conflicts and may be said to be one of our culture’s most positive qualities.

So, if it is one’s fate to lose a brutal war, one must feel fortunate indeed to have lost it to the noble Abraham Lincoln, and to a people so good and decent— so committed to right— and of such good will as our northern brothers and sisters– to those who fought that war and those who surely founded this Union League Club.

Let me say to those Republicans, whose party’s founding produced Lincoln, thank you for letting me, a young college student, join the party you founded, a party that believes in freedom, responsibility, the rule of law, a strong national defense, respect for religious faith, and prosperity.

We are here to honor a man who, in his day, was the unlikeliest of presidents.  He had spent most of his life in the private sector.  The year before the election, a New York publisher had put out a list of the 21 top candidates for the White House—and his name wasn’t on the list.  When the election year came, he was left off other lists again.

He had almost no experience in national politics.  He was considered unqualified.  He ran against senators and governors—including a former governor of Ohio and a senator from New York.  They were political giants.  It was one of the most talented fields of candidates anybody had seen in a generation. 

In some of our biggest cities, he didn’t receive a single vote.

The media mocked him for every reason imaginable.  They ridiculed his physical appearance.  One journalist wrote that “he has abused the privilege which all politicians have of being ugly.”

He was a self-taught lawyer.  He got his start in the law by reading the statute book of Indiana and by reading Blackstone—a copy of which he found in an old barrel.

But he was sophisticated and extremely experienced and respected in the legal community by the time he was elected President. 

More importantly, however, Lincoln had almost religious devotion to the rule of law.  In fact, that’s how he put it himself in his first big speech in public life, the Lyceum Address.  “Let reverence for the laws be taught in schools, in seminaries, and in colleges; let it be written in Primers, spelling books, and in Almanacs — let it be preached from the pulpit, proclaimed in legislative halls, and enforced in courts of justice…let it become the political religion of the nation.” So true: respect for law is the indispensable foundational principle of our republic. 

His argument was that keeping the rule of law was the single most important thing we can do to preserve our political institutions.  He argued that, if we accept small violations of the rule of law, then these violations will only become more frequent and more serious.  If that happens, it will instill in people contempt for law and eventually for the Republic itself.

Surely it is settled that under the Constitution, federal laws are supreme.  If one really respects the document, one will enforce it as written—whether one believes the provisions are wise or not. States and cities cannot change that or veto that.  If something is legal under state law but illegal under federal law, then it remains illegal under federal law.

If you want to change the laws of this country, or the Nation’s policies, the Constitution sets out a process.  You have to persuade your fellow citizens and work through the legislative process by persons elected, not faceless bureaucrats.

The disputes over secession and nullification were attempts to undo duly enacted laws of our country— those questions were settled by the people on the battlefield. 

Unfortunately, time and again, those who could not achieve their policy goals at the ballot box have attempted to impose them on their fellow citizens by other means.

We have seen this in decisions by unelected judges who redefine the meaning of words to establish policies that Congress never intended. Policies the people never approved. Now, single district judges are imposing nationwide injunctions to direct clearly executive functions. In fact, there had never been a nationwide injunction before the 1960’s— now, we at DOJ are steadfastly defending against the 19 nationwide injunctions that have been leveled against this administration in just one year. We are winning at the appellate and Supreme Court level, but time is precious and delays costly.

And we have seen jurisdictions attempt to nullify federal immigration law under so-called “sanctuary policies.”   One hears activists and a few officials even talk of nullification and secession. Let them come here to the Union League— or Gettysburg— if they’d like a legal and historical lesson on those subjects.

Today’s celebration is a good way to honor Lincoln’s legacy.  But at the Department of Justice, we seek to honor his legacy by upholding the rule of law day in and day out.

Let me ask you for a minute to discuss some other things we are doing to restore the rule of law and the constitutional balance.

We agreed to settlement terms with nearly 500 plaintiffs in cases brought by groups who were targeted by the IRS when they applied for tax-exempt status. They were subjected to inappropriate criteria that disproportionately impacted conservative groups.

The Department also provided legal advice to support agencies in this administration to end subsidies to insurance companies. These expenditures had not been appropriated by Congress under the Affordable Care Act or other law. The executive branch cannot spend money not appropriated by Congress.

We provided legal counsel to end the unlawful DACA policy.

Our Solicitor General filed an amicus brief in support of a Colorado baker who was sued for refusing to bake a cake for a same-sex wedding.

We issued a memo to help set policy to protect the free exercise of religion.

And as I mentioned, we are no longer allowing so-called “sanctuary” jurisdictions to defy federal immigration law if they want to receive our law enforcement grants.

In June, I ended the practice of third party settlements whereby settling parties were required to pay settlement funds to third party organizations that were not directly involved in the litigation or harmed by the defendant’s conduct.  Now those funds either go to victims or to the public treasury.

Government lawyers and bureaucrats do not have constitutional authority to appropriate taxpayer money for their favored groups. Only Congress can appropriate money.

We have ended regulation-by-guidance, where bureaucrats would impose regulations by simply sending a letter; we have rescinded dozens of existing regulations that were created in this unjustified manner and are studying more.

We are hammering violent groups- especially the vicious MS-13.

We’ve increased gun prosecutions. We have charged more defendants with violent crime offenses than in any year in decades. We have specific goals: to reduce violent crime, to reduce the surging homicide rate, to reduce overdose deaths, and to reduce opioid prescriptions.

We have taken and will take many other steps to restore the rule of law and improve public safety. Failure is not an option.

But I’ll be the first to acknowledge that we still have work to do.

There have been some very sharp criticisms about the Department. I hear these criticisms and welcome the discussion.  Sunlight truly is the best disinfectant. We will not ignore these problems or hide our heads in the sand.

Returning to the people of this great Department that I revere has been a wonderful experience. I work hard every day to be worthy of the great trust I have been given. My purpose every day is to ensure that we remain true to our fundamental mission of enforcing the law and protecting the safety of Americans, with integrity and fairness, and to earn the confidence of the American people. And with the Lord’s help, that’s what we will do.

Christiansburg Couple Sentenced on Tax Fraud, Bankruptcy-Related Charges

Source: United States Attorneys General

Headline: Christiansburg Couple Sentenced on Tax Fraud, Bankruptcy-Related Charges

Abingdon, VIRGINIA – United States Attorney Rick A. Mountcastle announced the sentencing of two Christiansburg residents who were previously convicted of tax fraud and multiple bankruptcy fraud charges.

Regan Dwayne Reedy, 56, was sentenced last week to 108 months in prison. He was previously convicted of conspiracy to commit tax fraud, making false declarations in a bankruptcy proceeding, concealment of property in a bankruptcy proceeding and false testimony in a bankruptcy proceeding.

Susan Annette Reedy, 50, was sentenced last week to 78 months in prison. She was previously convicted of making false declarations in a bankruptcy proceeding, concealment of property in a bankruptcy proceeding and false testimony in a bankruptcy proceeding.

According to evidence presented to the jury during the trial of Reagan and Susan Reedy by Assistant United States Attorney Joseph W. H. Mott, Reagan Reedy filed a number of fraudulent tax returns for individuals claiming refunds. The returns claimed excessive federal withholdings that resulted in excessive claims for tax refunds totaling over $1 million. A majority of the fraudulent returns were detected before refunds were issued, however, one refund in the amount of $156,191 was issued.

In addition to the tax return fraud, Regan Reedy and Susan Reedy filed three Chapter 7 bankruptcies seeking to discharge debts to private and governmental creditors.  In filings in 2012 and again in 2014, Regan and Susan Reedy omitted assets from their bankruptcy schedules and concealed assets from the bankruptcy trustee. Those assets included bank accounts, real estate, and vehicles they had placed in nominee names. At a creditors meeting in December 2014, both falsely testified regarding their means of support and the extent of their assets.  During their sentencing hearings last week, Regan and Susan Reedy were each held responsible for concealing over $1.8 million in assets during the course of the bankruptcies.

The investigation of the case was conducted by the Internal Revenue Service-Criminal Investigations, the Federal Bureau of Investigation, and the Office of the United States Trustee.

Arcadia-Based Methamphetamine Trafficker Sentenced To Over Seventeen Years In Prison

Source: United States Attorneys General

Headline: Arcadia-Based Methamphetamine Trafficker Sentenced To Over Seventeen Years In Prison

Tampa, Florida – U.S. District Judge Elizabeth A. Kovachevich today sentenced Antonio Chavez (34, Arcadia), a/k/a “Cino,” to 17 ½ years in federal prison for conspiracy to distribute more than 500 grams of methamphetamine and for possessing over 500 grams of methamphetamine with the intent to distribute it. The Court also ordered him to forfeit a Ford F250 truck that had been used to facilitate the offenses. In addition, $37,182 in cash was administratively forfeited as proceeds of the conspiracy.

Chavez pleaded guilty on May 4, 2017. His co-defendants, Johnny Carter and Adam McCumber, were previously sentenced to 15 years and 3 years and 10 months in prison, respectively.

According to court documents, Chavez was a supplier of methamphetamine in DeSoto and Manatee counties. In the fall of 2015, he arranged for the sale of methamphetamine to a confidential source on two occasions. Carter delivered the methamphetamine in the first sale, and McCumber made the delivery in the second sale. After a third deal to deliver a pound of methamphetamine in Myakka City (Manatee County) was agreed upon, law enforcement obtained a search warrant for Chavez’s house in Arcadia. Inside, agents found over 700 grams of methamphetamine and $37,000 in cash.

This case was investigated by the Drug Enforcement Administration, U.S. Customs and Border Patrol, the Lakeland Police Department, the Hardee County Sheriff’s Office, and the Plant City Police Department. It was prosecuted by Assistant United States Attorney Dan Baeza.

Norwalk Man Sentenced to Prison for Tax Evasion

Source: United States Attorneys General

Headline: Norwalk Man Sentenced to Prison for Tax Evasion

John H. Durham, United States Attorney for the District of Connecticut, announced that RYAN S. ROZYCKI, 41, of Norwalk, was sentenced today by U.S. District Judge Michael P. Shea in Hartford to six months of imprisonment, followed by two years of supervised release, for tax evasion.  Judge Shea also ordered ROZYCKI to pay a $50,000 fine.

According to court documents and statements made in court, ROZYCKI owns and operates bangthebook.com, a sports gaming information website, as well as other website businesses and rental properties.  For the 2009 though 2014 tax years, ROZYCKI reported more than $1.6 million in gross receipts on his federal income tax returns, but failed to report more than $1.1 million in taxable income, which he had deposited into his personal bank accounts.  ROZYCKI had worked with an accountant to prepare his tax returns, but did not provide his accountant with any information regarding his personal accounts and the business receipts that had been deposited into them.

As a result, ROZYCKI failed to pay more than $300,000 in federal income taxes.

ROZYCKI has paid full restitution of $336,780 to the IRS.  He also will be required to pay interest and penalties.

On September 20, 2017, ROZYCKI pleaded guilty to one count of tax evasion.

Judge Shea ordered ROZYCKI, who is released on a $100,000 bond, to report to prison on April 30, 2018.

This case was investigated by the Internal Revenue Service – Criminal Investigation Division, and was prosecuted by Assistant U.S. Attorney Michael S. McGarry.

Northeast Ohio Man Charged with Buying Gun for Convicted Felon who Killed Westerville Police Officers

Source: United States Attorneys General

Headline: Northeast Ohio Man Charged with Buying Gun for Convicted Felon who Killed Westerville Police Officers

COLUMBUS, Ohio – Gerald A. Lawson III, 30, of Warrensville Heights, Ohio, was charged by criminal complaint for allegedly acting as a straw purchaser for Quentin L. Smith, a convicted felon who shot and killed two Westerville Police Officers on February 10.

Lawson was charged with aiding and abetting the possession of a firearm by a prohibited person. He was arrested today by federal agents and is scheduled to appear before U.S. Magistrate Judge Kimberly A. Jolson today at 3:30pm.

Benjamin C. Glassman, United States Attorney for the Southern District of Ohio, and Trevor Velinor, Special Agent in Charge, Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) announced the charges.

According to the affidavit filed in support of the complaint, when Westerville Police Officers Anthony Morelli and Eric Joering responded to a disturbance call on Cross Wind Drive in Westerville, Smith was armed with a Glock semi-automatic handgun.

As a convicted felon, Smith is prohibited from purchasing or possessing a firearm.

An undisclosed witness told investigators Smith provided Lawson money for the firearm and an extra $100 to compensate Lawson – who knew Smith had been convicted of a felony – for buying the gun for him.

Investigators learned that Lawson and Smith have a long history of friendship. A review of Lawson’s social media account after the incident on February 10 revealed a post by Lawson displaying three photographs of both of the men together. A comment by Lawson associated with the post also referenced the long-standing friendship between the two.

Firearm trace results indicate the Glock firearm was purchased by Lawson in Broadview Heights, Ohio.

Aiding and abetting the possession of a firearm by a prohibited person is a federal crime punishable by up to 10 years in prison.

U.S. Attorney Glassman commended the investigation of this case by ATF, and Assistant United States Attorney Noah R. Litton, who is prosecuting the case.

A criminal complaint merely contains allegations, and the defendant is presumed innocent unless proven guilty in a court of law.

# # #

Former Arkansas Lawmaker Pleads Guilty to $4 Million Charity Scheme

Source: United States Attorneys General

Headline: Former Arkansas Lawmaker Pleads Guilty to $4 Million Charity Scheme

SPRINGFIELD, Mo. – Timothy A. Garrison, United States Attorney for the Western District of Missouri, announced that a former Arkansas state representative pleaded guilty in federal court today to his role in a conspiracy to embezzle more than $4 million from a Springfield, Mo.-based health care charity.

Eddie Wayne Cooper, 51, of Melbourne, Ark., waived his right to a grand jury and pleaded guilty before U.S. Magistrate Judge David P. Rush to a federal information that charges him with one count of conspiracy to embezzle from the nonprofit organization.

By pleading guilty today, Cooper admitted that he conspired with several executives of Preferred Family Healthcare, Inc., a non-profit charity headquartered in Springfield, to use the charity’s funds for unlawful political contributions, for excessive, unreported lobbying and to financially benefit themselves. Cooper received a total of at least $387,501 from a lobbying firm and at least $63,000 in kickbacks as a result of his participation in the conspiracy. Under the terms of today’s plea agreement, Cooper must forfeit his gain from the conspiracy to the government.

Cooper was an Arkansas State Representative from 2006 through January 2011, and a lobbyist registered with the Arkansas Secretary of State beginning Jan. 20, 2011. On April 20, 2009, Cooper was hired to the full-time position of regional director for Preferred Family Healthcare. Cooper’s employment with the charity ended on April 26, 2017. Cooper was a member of the charity’s board of directors from October 2009 through April 2015; he also worked as a lobbyist.

Court documents cite, but do not identify by name, five additional co-conspirators who are not charged in the fraud scheme. Person #1, Person #2 and Person #3 – all residents of Springfield – were executives at the charity. They include the founder and chief financial officer of the charity, the charity’s chief operating officer and the charity’s chief executive officer. Person #4, a resident of Rogers, Ark., served as an executive for company operations in the state of Arkansas. Person #4 also operated two lobbying firms.

According to today’s plea agreement, conspirators engaged in multiple schemes to unlawfully use the charity’s funds to make political contributions, for excessive and unreported lobbying and political advocacy, and to unjustly enrich themselves. For example, conspirators caused personal contributions to elected officials and their political campaigns to be reimbursed by the charity. Such indirect contributions are prohibited by law just as if the payments had been made by the charity directly.

In order to provide a veneer of legitimacy for the kickbacks paid to themselves and others, and to disguise the nature and source of the payments, conspirators caused the payments to be described in the records as business expenses, such as “consulting” and “training” services, and executed sham “consulting agreements.” 

Part of the scheme involved $3 million in payments and kickbacks with a company identified in court documents as Lobbying Firm A, an Arkansas firm owned and operated by Person #4 that also employed Cooper as a lobbyist.

Preferred Family Healthcare paid Lobbying Firm A to provide lobbying and advocacy services. Cooper and others solicited the assistance of elected and appointed officials regarding legislative issues that impacted the charity, in particular matters involving the charity, and in steering grants and other sources of funding to the charity from 2010 through 2017. These funding sources included proceeds from the Arkansas General Improvement Fund.

Preferred Family Healthcare paid Lobbying Firm A more than $3 million from 2010 to 2017. These checks were falsely classified as a consulting expense in the books and records of the charity, when in fact the checks were payments for lobbying services, including direct contact with elected and appointed public officials, and for kickbacks paid to Person #1. From 2010 through 2015, the plea agreement says, Person #4 paid $640,500 in kickbacks to Person #1 by way of checks, and on numerous additional occasions, paid kickbacks in cash.

Part of the scheme also involved nearly $1 million in payments and kickbacks with a Philadelphia, Penn.-based lobbying firm. Donald Andrew Jones, also known as “D.A.” Jones, 62, of Willingboro, N.J., pleaded guilty on Dec. 18, 2017, to his role in the conspiracy.

Jones’s firm, D.A. Jones & Associates, based in Philadelphia, provides political and advocacy services, including consulting, analysis, and public relations. Jones admitted that he was paid approximately $973,807 by Preferred Family Healthcare for illegal lobbying and political activity on behalf of the charity. Two co-conspirators received a total of $264,000 in kickbacks from Jones.

According to court documents, Jones occasionally suggested that charity executives make political contributions to legislators they wanted to influence and/or thank for assistance. From time to time, Jones delivered their contribution checks directly to the legislators in Washington D.C., to increase the impact of the donations.

Between Jan. 12, 2012, and Jan. 17, 2017, Jones paid Person #4 a total of $219,000 in kickbacks. Additionally, at the direction of Person #4, Jones paid Cooper kickbacks of $25,000 on Jan. 8, 2013, and $20,000 on Dec. 26, 2013. On Jan. 18, 2012, Person #4 caused Lobbying Firm A to issue an $18,000 check Cooper, constituting Cooper’s share of Jones’s Jan. 2, 2012, kickback payment.

Under federal statutes, Cooper is subject to a sentence of up to five years in federal prison without parole. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendants will be determined by the court based on the advisory sentencing guidelines and other statutory factors. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.

Preferred Family Healthcare & Dayspring Behavioral Health Services

Preferred Family Healthcare and its subsidiaries provide a variety of services to individuals, including mental and behavioral health treatment and counseling, substance abuse treatment and counseling, employment assistance, aid to individuals with developmental disabilities, and medical services. The charity, which reported more than $180 million in total revenue in 2016, received Medicaid reimbursements from the states of Missouri, Arkansas, Kansas and Oklahoma. The federal portion of those payments totaled more than $255 million from 2011 to 2016. The charity also received more than $53 million from the federal government (the Departments of Health and Human Services, Labor, Agriculture, Housing and Urban Development, Veterans Affairs, and Justice) under programs involving grants, contracts, loans, guarantees, insurance and other forms of federal assistance from July 1, 2010, to June 30, 2016.

Originally, and for most of its existence, Preferred Family Healthcare was known as Alternative Opportunities, Inc., which was incorporated in 1991. Alternative Opportunities merged with Preferred Family Healthcare of Kirksville, Mo., on May 1, 2015.

Dayspring Behavioral Health Services was an Arkansas company providing behavioral health services, which was acquired by Alternative Opportunities in 2007 and thereafter continued as a business alias of the charity. Doing business as Dayspring, the charity operated dozens of clinics throughout the state of Arkansas, offering a variety of behavioral health services to individuals, families, and groups.

This case is being prosecuted by Assistant U.S. Attorney Steven M. Mohlhenrich. It was investigated by IRS-Criminal Investigation, the FBI and the Offices of the Inspectors General from the Departments of Labor, Health and Human Services, Housing and Urban Development, Veterans Affairs, and the FDIC. This is a combined investigation with the Western District of Arkansas, the Eastern District of Arkansas, the Eastern District of Pennsylvania and the Public Integrity Section of the Department of Justice.
 

Oshkosh Drug Dealer Receives 20 Years in Federal Prison for Overdose Death

Source: United States Attorneys General

Headline: Oshkosh Drug Dealer Receives 20 Years in Federal Prison for Overdose Death

Gregory J. Haanstad, United States Attorney for the Eastern District of Wisconsin, announced that on February 8, 2018, Anthony R. Chaplin (age: 41) of Oshkosh, Wisconsin, was sentenced to 20 years in federal prison for his distribution of fentanyl and methamphetamine to an Appleton woman, Joy Strader, resulting in her death in May of 2017. 

Chaplin admitted dealing what he believed to be heroin to the victim on numerous occasions. The heroin was, unbeknownst to Chaplin and the victim, an especially potent form of fentanyl. At the same time he sold the fatal dose of fentanyl, Chaplin also sold the victim methamphetamine. The combination of fentanyl and methamphetamine were determined to be the cause of death according to the medical examiner’s findings.  

In pronouncing sentence, Chief U.S. District Court Judge William C. Griesbach noted the serious nature of Chaplin’s crime and the negative effect that fentanyl and methamphetamine has had on the community. He found that Chaplin was aware of the inherent dangers of distributing illegal substances, but continued to do so despite the risk to others. Following his release from prison, Chaplin will serve 5 years on federal supervised release.    

The case was investigated by the Appleton Police Department and the Winnebago County Sheriff’s Office. Assistant United States Attorney Daniel R. Humble prosecuted the case.

Drug Dealer Sentenced to 235 Months Imprisonment

Source: United States Attorneys General

Headline: Drug Dealer Sentenced to 235 Months Imprisonment

 Spokane– Joseph H. Harrington, United States Attorney for the Eastern District of Washington, announced that Daniel Woolem, age 49, of Moxee, Washington, was sentenced for Conspiracy to Distribute Methamphetamine and for Distribution of Methamphetamine. United States District Judge Stanley A. Bastian sentenced Woolem to a 235-month term of imprisonment, to be followed by five years of court supervision after he is released from federal prison.

According to information disclosed during court proceedings, in July 2015, a task force was created to investigate suspected drug trafficking organizations operating within Yakima County. During the investigation, law enforcement learned that Woolem was selling methamphetamine out of his residence in Moxee. In addition, law enforcement officers learned that Woolem was supplying street level drug dealers with methamphetamine. Law enforcement officers obtained multiple photographs of Woolem meeting with street level drug dealers at his residence. The investigators gathered evidence which resulted in the filing of a criminal Indictment.

On October 26, 2016, a search warrant was executed at the Woolem residence. In addition to other items, law enforcement officers discovered an elaborate security system, multiple firearms, loaded magazines, a suppressor, a bump stock, and drug paraphernalia.

In August, 2017, the case went to trial. Multiple witnesses testified concerning personal observations of Woolem selling methamphetamine at his residence. Several law enforcement officers testified and described the organization. The jury was provided with evidence obtained during the investigation. Woolem testified that he never sold drugs and that he was essentially a Good Samaritan who assisted the less fortunate. Woolem described how he occasionally would bring homeless people from Walmart to his home to bathe, and that he would provide them with food, cigarettes, and other items. On August 24, 2017, the jury found him guilty of all the charges.

At the February 7, 2017 sentencing hearing, Judge Bastian observed that Woolem lied when he testified under oath, which resulted in an obstruction of justice Enhancement. Judge Bastian determined that it was clear Woolem had a leadership role in the distribution of methamphetamine. It was based, in part, on Woolem’s obstruction of justice and leadership role that resulted in the 235-month term of imprisonment and five years of court supervision following release from federal prison.

Joseph H. Harrington stated, “I commend the law enforcement officers who worked on this case. Their seamless partnership resulted in the successful outcome in this matter. The United States Attorney’s Office in the Eastern District of Washington is, and will continue to be, committed to prosecuting aggressively and seeking appropriate punishment for offenders who distribute drugs in this District.”

This investigation was conducted by the Drug Enforcement Administration, the Yakama Nation Police Department, the Yakima County Sheriff’s Office, the Yakima Police Department, the Union Gap Police Department, the Moxee Police Department, the Toppenish Police Department, the Bureau of Alcohol, Tobacco, Firearms, and Explosives, the Department of Homeland Security – Homeland Security Investigations, and the Law Enforcement Against Drugs Task Force. The case was prosecuted by Tom Hanlon, an Assistant United States Attorney for the Eastern District of Washington.

Woman Faked Death in Cross-Country Luxury Vehicle Fraud Scheme

Source: United States Attorneys General

Headline: Woman Faked Death in Cross-Country Luxury Vehicle Fraud Scheme

NEWPORT NEWS, Va. – A Portsmouth woman who faked her own death in connection with an elaborate bank fraud scheme was sentenced today to four years in prison.

According to court documents, Alexandra Hatcher, 50, conspired with her husband, Albert Hatcher Jr., 49, to collect on life insurance policies the two had obtained to insure Hatcher’s life. After traveling to Washington state and changing her legal name in August 2015, Hatcher and her husband submitted false death claims on at least two of these policies. In support of these claims, Hatcher created fake death certificates and published a death notice in the Daily Press. After insurers denied their claims, Hatcher and her husband undertook a cross-country fraud scheme through which they fraudulently obtained at least 20 new and newer-used luxury vehicles by presenting worthless and counterfeit checks and forged documents to car dealerships in several states. Hatcher and her husband retitled these vehicles and then used them as collateral for loans and other vehicles. The two also resold vehicles to other dealerships for cash. Hatcher used the legal name she adopted just prior to faking her death to purchase, title, and resell vehicles in furtherance of the scheme. 

The Hatcher’s each pleaded guilty to conspiracy to commit bank fraud, possessing and uttering a counterfeit security of an organization, and conspiracy to commit mail fraud. Albert Hatcher was sentenced to four years in prison on January 22 for his role in the scheme.

Tracy Doherty-McCormick, Acting U.S. Attorney for the Eastern District of Virginia, and Robert B. Wemyss, Inspector in Charge of the Washington Division of the U.S. Postal Inspection Service, made the announcement after sentencing by Senior U.S. District Judge Robert G. Doumar. Assistant U.S. Attorney Kaitlin C. Gratton prosecuted the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 4:17-cr-48.