Tag Archives: investigation

Texas Man Sentenced for Attempt to Smuggle Ammunition to Mexico

January 18, 2013blogammunition, ammunition smuggling, arrest, Bureau of Alcohol Tobacco Firearms and Explosives, CBP, HSI, ICE, illegal firearms, investigation, Mexico, sentencing, smugglingAlex Meyerovich

A local man was sentenced Friday, January 11, 2013, to 41 months in federal prison followed by three years of supervised release for purchasing ammunition that was to be smuggled into Mexico. The case was investigated by U.S Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI).

Edward Sandoval, 31, from San Antonio, pleaded guilty Sept. 6 to aiding and abetting the smuggling of goods from the United States.

According to the factual basis filed in this case, in January and February 2011, Sandoval admittedly purchased about 40,000 rounds of multiple caliber ammunition, including 7.62mm and .223-caliber, from a San Antonio gun shop for a friend who informed Sandoval that the ammunition was destined for Mexico via Eagle Pass,Texas.

Sandoval further admitted that he was paid $1,500 each time he bought ammunition for others. In February 2011, authorities in Eagle Pass seized about 15,000 rounds of ammunition purchased by Sandoval before it was smuggled into Mexico.

The Bureau of Alcohol, Tobacco, Firearms and Explosives also assisted with this investigation.

Assistant U.S. Attorney Mark Roomberg, Western District of Texas, prosecuted this case.

Drug Smuggling Airline Employee Sentenced After Two-Year Investigation

October 5, 2012blogAirport Investigations Group, arrest, Bermuda, Bermuda Police Service, CBP, conspiracy, DEA, Drug Enforcement Administration, drug smuggling, drug trade, HSI, ICE, investigation, marijuana, narcotics, Philadelphia International Airport, sentencing, terrorism, US AirwaysAlex Meyerovich

Nearly two years from October 2, 2012, Philadelphia International Airport came to a grinding halt as a security incident was discovered on a Bermuda-bound US Airways aircraft. This security incident turned out to be a drug smuggling operation discovered by an astute airline employee, and investigated by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI).

It was later discovered that Brian Wade used his position as a baggage handler at the airport to smuggle drugs on US Airways flights to Bermuda for more than 10 years.

Spotted by a US Airways employee Oct. 7, 2010, Wade, wearing his work uniform and off duty at the time, was observed placing items in the baggage hold of US Airways flight 1070. The incident garnered immediate live national media coverage that afternoon. As the incident was being investigated for possible ties to terrorism, HSI special agents assigned to the airport determined it was tied to an elaborate narcotics smuggling scheme between Philadelphia and Bermuda.

Wade was arrested and later pleaded guilty to two counts of possession with intent to distribute a total of 3,022 grams of marijuana. This was related to his efforts to send marijuana to Bermuda by hiding it in commercial aircraft. On October 2, 2012, Wade was sentenced in federal court to 36 months of probation and a $1,000 fine.

“This investigation disrupted and dismantled an internal conspiracy that was going on for years at the Philadelphia International Airport,” said John Kelleghan, special agent in charge of HSI Philadelphia. “Keeping the flying public safe by stopping the flow of dangerous drugs, and bringing individuals engaged in international drug trafficking to justice is a high HSI priority.”

But that wasn’t the end of the investigation. What began in October 2010 continued for more than a year following Wade’s arrest when HSI’s Philadelphia Airport Investigations Group – working with an undercover agent posing as an associate of the corrupt airline worker – received 421 grams of heroin from a target of the HSI investigation. As part of the investigation, the heroin was replaced with “sham” narcotics and placed in a package that was sent to Bermuda concealed aboard a commercial aircraft.

HSI special agents determined that Wade had received the narcotics from unknown individuals who traveled to Philadelphia from New York on behalf of their conspirators in Bermuda. Wade received payment from his counterparts at the airport in Bermuda, who would place cash on the flight destined for Philadelphia. Once the aircraft arrived in Philadelphia, Wade would take the cash off in the same manner he smuggled the narcotics to Bermuda.

On June 1, 2011, HSI, U.S. Customs and Border Protection (CBP), the Drug Enforcement Administration (DEA) and the Bermuda Police Service (BPS) successfully dismantled this organization that was using Philadelphia International Airport to smuggle narcotics. Working around the clock, law enforcement officials identified corrupt airport and airline employees in the U.S. and Bermuda who utilized their positions to circumvent airport security and federal inspection procedures.

The resulting investigation led to the arrests in Bermuda of Lorenzo Lottimore, David Carroll and Lauren Marshall, current and former L.H. Wade International Airport employees. Another individual, Damian Hatherly, was also arrested. All four were charged with importation of narcotics. The drugs have a street value in Bermuda of almost $1 million. Subsequently, $90,000 in suspected drug proceeds was seized from a bank account utilized by Carroll.

On Sept. 10, 2012, just before the trial was due to start, Carroll pleaded guilty to conspiracy to import controlled narcotics, specifically cannabis and heroin, and agreed to forfeit $70,000 in Bermuda currency. Additionally, authorities in Bermuda dropped prosecution against Marshall.

On Sept. 25, 2012, a Bermuda Supreme Court jury convicted Lottimore and Hatherly of one count each of conspiracy to import controlled drugs. They both face a minimum of 12 years in prison.

HSI special agents noted that US Airways officials cooperated fully throughout the entire investigation.

Charges for Individuals and Corporation Involved in Million Dollar Afghani Military Fraud Scheme

August 30, 2012blogAfghanistan, American International Security Corporation, arrest, conspiracy, DCIS, fraud, HSI, ICE, investigation, Iraq War, IRS, military, US Army Criminal Investigation Command, war on terrorAlex Meyerovich

Three individuals and a corporation are charged with fraud and bribery in connection with their alleged role in a multi-million dollar fraud scheme involving the procurement of a military contract for services in Afghanistan, according to an indictment returned by a federal grand jury in Salt Lake City Wednesday, August 22, 2012.

Named in the 72-count indictment are David Young, 49, of Hernando Beach, Fla.; Christopher Harris, 48, of Lake Havasu, Ariz.; and Michael Taylor, 51, of Boston, the president of American International Security Corporation (AISC), which is also charged in the indictment.

The indictment alleges conspiracy; procurement and wire fraud; bribery of a public official; acceptance of a bribe by a public official; and money laundering and structuring violations. The charges follow an investigation by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), the Defense Criminal Investigative Service (DCIS), Internal Revenue Service-Criminal Investigation and the U.S. Army Criminal Investigation Command, Major Procurement Fraud Unit.

“As we are all aware, families in Utah and all across America continue to send loved ones to serve our nation in Afghanistan, and taxpayers continue to pay for the cost of the effort,” said Utah U.S. Attorney David B. Barlow. “Our office will fully and aggressively pursue alleged public corruption and fraud against taxpayers and the government such as that identified in today’s indictment.”

According to the indictment, in the spring of 2007, bids for a contract to manage Afghan supplies and train Afghan troops to do supply management were solicited by the U.S. Army. Because the need was deemed urgent, the Army requested a limited number of bids for the contract from private entities selected by the Army. The contract required the work to be performed in Afghanistan by a U.S. company. The indictment alleges the defendants conspired to use protected contract information to obtain an unfair competitive advantage for AISC over other bidders.

“The scope, complexity and brazenness of this alleged fraud scheme are astounding,” said ICE Director John Morton. “If the allegations prove true, millions of dollars in U.S. government funds earmarked to help train and equip Afghan soldiers were used instead to indulge the defendants’ appetites for wealth and opulent lifestyles, including investments in private planes, precious metals and real estate. As this long-term probe and the resulting indictment make clear, HSI and its investigative partners are committed to ensuring that those who misuse taxpayers’ dollars and violate the public’s trust are held accountable for their actions.”

The indictment alleges that Young, an activated reservist in the Army with the rank of Lieutenant Colonel, served as a current or former public official in his action for and on behalf of the U.S. Army. By virtue of his position, Young had access to bid, proposal and source selection information about the contract, including information establishing the government’s price estimate. Young also suggested AISC as one of a limited number of bidders. As a current or former official with responsibilities involving the contract, Young was barred from personally benefiting from the contract.

The indictment alleges that before the contract was awarded, Young disclosed information about the government’s price estimate, selection criteria, competing bid information and other confidential procurement information to Harris, Taylor, and AISC. The indictment also alleges Harris,Taylor, and AISC promised and gave money to Young in return for him using his official position to influence the award of the contract.

“Fraud and corruption in military contracting not only take away precious dollars necessary for the dedicated American warfighter, but they undermine the confidence of the American public who demand a military procurement system that spends their tax dollars wisely and responsibly,” said Janice M. Flores, special agent in charge of the DCIS Southwest Field Office. “In this case, it is alleged that both a military officer and a government contractor betrayed the public’s trust. This investigation should serve as a warning for those intent on defrauding the U.S. military and American public that law enforcement will pursue these crimes relentlessly.”

Using the protected contract information, AISC submitted a bid to the U.S. Army of $899,782, an amount that allegedly closely matched the military’s price estimate for the contract which Young had helped establish. AISC was awarded the six-month contract in the amount of $899,781.96. The indictment also alleges that based on the initial fraud in the procurement of the pilot contract, Harris, Young and Taylor obtained extensions of the contract and four additional follow-on contracts. According to the indictment, AISC received approximately $54 million from the Army under the agreement. The co-conspirators distributed more than $20 million among themselves, the indictment alleges.

The indictment alleges 13 counts of bribery of a public official and 13 counts of acceptance of a bribe by a public official in connection with payments Harris, Taylor and AISC made to Young. The indictment claims Harris, Young, Taylor and AISC used nominee entities and individuals to conduct and conceal the transfer of proceeds of their scheme among themselves. The indictment charges 16 counts of wire fraud involving email correspondence between the defendants as a part of the execution of the alleged fraud scheme.

Several counts of the indictment relate to alleged steps the defendants took to conceal the alleged fraud, including engaging in money laundering and structuring transactions. Harris is charged in seven counts of the indictment with structuring currency transactions he made at America First Credit Union in St. George, Utah, to avoid the financial institution’s legal obligation to report transactions in excess of $10,000. The indictment alleges Harris made a series of $9,000 cash withdrawals from the credit union between May 2009 and February 2010.

“IRS Criminal Investigation is proud to lend its financial investigative expertise to complex, multi-agency investigations,” Paul Camacho, special agent in charge of the IRS Las Vegas Field Office, said. “By working closely with our fellow law enforcement partners, we can ensure that crime doesn’t pay. We hit the bad guys where it hurts – in their wallets. By taking away their assets and profits, we deprive them of the proceeds of their criminal activity.”

The indictment also contains a notice of intent to seek forfeiture of substantial real and personal property, including more than $6 million in funds; approximately 20 houses and other property in Utah, Florida, Arizona and New Hampshire; motor vehicles, including a Hummer and a Jaguar; a boat; an airplane; and hundreds of gold coins.

Harris was arrested in Utah on a complaint filed in July. He had an initial appearance and was released. Summonses will be issued to AISC, Young and Taylor to appear in U.S. District Court inSalt Lake City.

The conspiracy count carries a maximum penalty of up to five years in prison. The two government procurement fraud counts also have potential five-year sentences. The potential penalty for the bribery charges is up to 15 years for each count. Each of the 16 wire fraud counts is punishable by up to 30 years in prison. The money laundering counts carry potential maximum penalties of 10 to 20 years, depending on the violation. The charges involving the structuring of transactions carry potential penalties of up to five years per count.

Indictments are not findings of guilt. Individuals charged in indictments are presumed innocent unless or until proven guilty in court.

Texas Company Forfeits $2 Million for Hiring Illegal Aliens

May 21, 2012blogemployment fraud, HSI, ICE, illegal aliens, immigration fraud, investigationAlex Meyerovich

ABC Professional Tree Services Inc. (ABC) has agreed to adhere to revised immigration compliance procedures and to pay $2 million as forfeited funds to the Department of Homeland Security related to revenue derived from the employment of illegal aliens. The announcement was made by U.S. Attorney Kenneth Magidson, Southern District of Texas, along with Robert Rutt, special agent in charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI).

For its part, the United States has agreed not to criminally prosecute the company. ABC is a Houston-based company that provides right of way vegetation management for electric utilities in more than a dozen states.

HSI agents in Birmingham, Ala., began investigating ABC in early 2008 following complaints that a significant portion of the company’s employees were undocumented aliens. In March 2008, agents conducted traffic stops on ABC crews and detained employees who were determined to be unlawfully present in the United States.

In June 2008, agents reviewed the Employment Eligibility Verification Forms (I-9s) and supporting documentation for about 2,500 employees at ABC. The inspection revealed a significant number of employees, when hired, had presented invalid personal identification information. Later, HSI agents determined that, as of the second quarter of 2009, about 30 percent of the company’s workforce consisted of undocumented aliens.

HSI agents executed a federal search warrant at ABC’s Houston headquarters on March
4, 2010, seizing documentary evidence including employment and personnel records. At that time, agents detained undocumented aliens who were on site at the headquarters. On that same day, agents in Birmingham detained more undocumented ABC employees during a traffic stop.

The government’s investigation revealed ABC had, for years, ignored federal law by falsely attesting on I-9s that work authorization documents presented by new hires appeared genuine. In addition, for several years, ABC had received notices from the Social Security Administration known as “no-match letters,” and similar information from the company’s payroll processor, both of which indicated employee names and Social Security numbers did not match SSA records.

The company failed to take corrective measures, resulting in the continued employment of the undocumented aliens. ABC derived at least $2 million in revenue from the provision of services to electrical utilities with its illegal workforce from 2006 through 2011. This figure represents the amount of money that ABC will forfeit under its non-prosecution agreement with the government.

Since becoming aware of the government’s investigation, ABC has remediated its workforce and imposed significant immigration compliance measures. Since September 2008, ABC has used E-verify, a database administered by the federal government, to verify the employment eligibility of new hires. Beginning in the fall of 2008, the company also revised its immigration compliance procedures to include new policies concerning the proper completion, retention and auditing of I-9s and for responding to SSA No Match letters. As part of its commitment to complying with the law, ABC also terminated hundreds of undocumented workers.

Assistant United States Attorney David Searle, Southern District of Texas, handled the
case.