Pascua Yaqui Teen Sentenced to 18 Months in Prison for Stabbing Another Man

TUCSON—On January 31, 2013, Michael A. Alvarez-Suarez, 19, of Tucson, Arizona, was sentenced by visiting U.S. District Judge Marvin Aspen to 18 months in a federal prison, followed by three years of supervised release. Alvarez-Suarez pleaded guilty on November 29, 2012, to one count of aggravated assault. Both the victim and the defendant are members of the Pascua Yaqui Tribe, where the altercation took place.
On August 1, 2011, one week after turning 18, Alvarez-Suarez got into a confrontation with a man. Alvarez-Suarez pulled out a pocket knife during the encounter and stabbed the victim twice, resulting in non-life-threatening injuries. Alvarez-Suarez was arrested by Pascua Yaqui police and was prosecuted through the Tribal Court, where he served a six-month prison sentence for assault. In the meantime, he was indicted by a federal grand jury for felony aggravated assault and was taken into federal custody on January 25, 2012, immediately after completing his tribal sentence.
The investigation in this case was conducted by the Pascua Yaqui Police Department and the Federal Bureau of Investigation, Tucson Resident Agency. The prosecution was handled by Micah Schmit, Assistant U.S. Attorney, District of Arizona, Tucson.

BP Exploration and Production Inc. Pleads Guilty, is Sentenced to Pay Record $4 Billion for Crimes Surrounding Deepwater Horizon Incident

WASHINGTON—BP Exploration and Production Inc. pleaded guilty today to 14 criminal counts for its illegal conduct leading to and after the 2010 Deepwater Horizon disaster and was sentenced to pay $4 billion in criminal fianes and penalties, the largest criminal resolution in U.S. history, Attorney General Holder announced today.
“Today’s guilty plea and sentencing represent a significant step forward in the Justice Department’s ongoing efforts to seek justice on behalf of those affected by one of the worst environmental disasters in American history,” said Attorney General Holder. “I’m pleased to note that more than half of this landmark resolution—which totals $4 billion in penalties and fines and represents the single largest criminal resolution ever—will help to provide direct support to Gulf Coast residents as communities throughout the region continue to recover and rebuild.”
“The Deepwater Horizon explosion was a national tragedy that resulted in the senseless deaths of 11 people and immense environmental damage,” said Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division. “Through the tenacious work of the task force, BP has received just punishment for its crimes leading up to and following the explosion. The Justice Department will keep a watchful eye on BP’s compliance with the plea agreement’s terms, including the requirements of full cooperation with the department’s ongoing criminal investigation, implementation of enhanced safety protocols, and adherence to the recommendations of two newly installed monitors. Should BP fail to comply, we will act swiftly and firmly.”
BP’s guilty plea was accepted and the sentence was imposed by U.S. District Judge Sarah S. Vance of the Eastern District of Louisiana. During the guilty plea and sentencing proceeding, Judge Vance found, among other things, that the consequential fines imposed under the plea agreement far exceed any imposed in U.S. history and are structured so that BP will feel the full brunt of the penalties. She also noted that the agreement provides just punishment and significant deterrence, requiring detailed drilling safeguards, monitors, and other stringent, special conditions of probation so that BP’s future conduct will be closely watched.
BP pleaded guilty to each count charged in an information filed in U.S. District Court in the Eastern District of Louisiana, including 11 counts of felony manslaughter, one count of felony obstruction of Congress, and violations of the Clean Water and Migratory Bird Treaty Acts. In its guilty plea today, BP admitted that, on April 20, 2010, the two highest-ranking BP supervisors onboard the Deepwater Horizon, known as BP’s “Well Site Leaders” or “company men,” negligently caused the deaths of 11 men and the resulting oil spill. The company also admitted that on that evening, the two well site leaders observed clear indications that the Macondo well was not secure and that oil and gas were flowing into the well but chose not to take obvious and appropriate steps to prevent the blowout. Additionally, BP admitted that as a result of the Well Site Leaders’ conduct, control of the Macondo well was lost, resulting in catastrophe.
BP also admitted during its guilty plea that the company, through a senior executive, obstructed an inquiry by the U.S. Congress into the amount of oil being discharged into the Gulf while the spill was ongoing. BP also admitted that the senior executive withheld documents, provided false and misleading information in response to the U.S. House of Representatives’ request for flow-rate information, manipulated internal estimates to understate the amount of oil flowing from the well and withheld data that contradicted BP’s public estimate of 5,000 barrels of oil per day. At the same time that the senior executive was preparing his manipulated estimates, BP admitted, the company’s internal engineering response teams were using sophisticated methods that generated significantly higher estimates. The Flow Rate Technical Group, consisting of government and independent scientists, later concluded that more than 60,000 barrels per day were leaking into the Gulf during the relevant time, contrary to BP’s representations to Congress.
According to the sentence imposed by Judge Vance pursuant to the plea agreement, more than $2 billion dollars will directly benefit the Gulf region. By order of the court, approximately $2.4 billion of the $4 billion criminal recovery is dedicated to acquiring, restoring, preserving, and conserving—in consultation with appropriate state and other resource managers—the marine and coastal environments, ecosystems, and bird and wildlife habitat in the Gulf of Mexico and bordering states harmed by the Deepwater Horizon oil spill. This portion of the criminal recovery is also to be directed to significant barrier island restoration and/or river diversion off the coast of Louisiana to further benefit and improve coastal wetlands affected by the oil spill. An additional $350 million will be used to fund improved oil spill prevention and response efforts in the Gulf through research, development, education, and training.
BP was also sentenced to five years of probation—the maximum term of probation permitted under law. The company is also required, according to the order entered by the court pursuant to the plea agreement, to retain a process safety and risk management monitor and an independent auditor, who will oversee BP’s process safety, risk management, and drilling equipment maintenance with respect to deepwater drilling in the Gulf of Mexico. BP is also required to retain an ethics monitor to improve its code of conduct to ensure BP’s future candor with the U.S. government.
The charges and allegations pending against individuals in related cases are merely accusations, and those individuals are considered innocent unless and until proven guilty.
The guilty plea and sentence announced today are part of the ongoing criminal investigation by the Deepwater Horizon Task Force into matters related to the April 2010 Gulf oil spill. The Deepwater Horizon Task Force, based in New Orleans, is supervised by Assistant Attorney General Breuer and led by Deputy Assistant Attorney General John D. Buretta, who serves as the director of the task force. The task force includes prosecutors from the Criminal Division and Environment and Natural Resources Division of the Department of Justice; the U.S. Attorney’s Office for the Eastern District of Louisiana, as well as other U.S. Attorneys’ Offices; and investigating agents from the FBI; Environmental Protection Agency, Criminal Investigative Division; Environmental Protection Agency, Office of Inspector General; Department of Interior, Office of Inspector General; National Oceanic and Atmospheric Administration Office of Law Enforcement; U.S. Coast Guard; U.S. Fish and Wildlife Service; and the Louisiana Department of Environmental Quality.
This case was prosecuted by Deepwater Horizon Task Force Director John D. Buretta, Deputy Directors Derek A. Cohen and Avi Gesser, and task force prosecutors Richard R. Pickens, II, Scott M. Cullen, Colin Black, and Rohan Virginkar.

Man Who Threatented to Rob Bank with Explosives Sentenced

PHILADELPHIA—Dragos Ungurean, 30, of Wyomissing, Pennsylvania, was sentenced today to 63 months in prison for attempting to rob the Wyomissing branch of M&T Bank. He pleaded guilty to the charge on June 27, 2012. On March 19, 2012, Ungurean walked into the bank at 800 Penn Avenue in Wyomissing, threatened to blow up a bomb or explosive device attached to his person, and demanded money. Ungurean was subdued and handcuffed after a scuffle with an on-duty plain clothes investigator, George R. Bell, Jr., from the Wyomissing Police Department. The officer was utilizing the bank as a customer at the time of the attempted robbery. The bomb or explosive device was fake.
In addition to the prison term, U.S. District Court Judge Lawrence F. Stengel ordered three years of supervised release and a $1,000 fine. The judge also referred to the actions of investigator Bell as “heroic” for subduing the defendant on his own.
This case was investigated by the Federal Bureau of Investigation, Allentown, Pennsylvania Resident Agency; the Wyomissing, Berks County Police Department; and the Berks County District Attorney’s Office, and it is being prosecuted by Assistant United States Attorney Ewald Zittlau.

Lawyer Pleads Guilty to Stealing Money Intended for His Clients

WASHINGTON—Deairich R. Hunter, 47, an attorney from Washington, D.C., pled guilty today to a federal charge stemming from his theft of $109,830 in payments from insurance companies that were intended to settle some of his clients’ disability and personal injury claims.
The plea took place in the U.S. District Court for the District of Columbia and was announced by U.S. Attorney Ronald C. Machen, Jr.; Debra Evans Smith, Acting Assistant Director in Charge of the FBI’s Washington Field Office; and William P. White, Commissioner of the District of Columbia Department of Insurance, Securities, and Banking.
Hunter pled guilty to a charge of theft or embezzlement in connection with health care. He is to be sentenced April 26, 2013, by the Honorable Beryl A. Howell. The charge carries a maximum statutory sentence of 10 years in prison and a fine of up to $250,000. As part of his plea agreement, Hunter agreed to pay $109,830 in restitution to his clients and a medical provider whose bills were to be paid out of the settlement funds.
According to a statement of offense, signed by the defendant as well as the government, from August 1998 until April 2009, Hunter was a member of the Bar of the District of Columbia Court of Appeals and practiced law in the District of Columbia. Also during that time period, he was a member of the bar of the state of Maryland.
Between 2003 and 2009, Hunter was retained by various individuals in disability and personal injury claim disputes. Those clients generally agreed that Hunter was entitled to one-third of any recoveries regarding their settled claims. Hunter generally agreed to notify these clients of any offers of settlement and to inform clients of significant developments, among other things. In some cases, he agreed to pay his clients’ health care expenses directly from the proceeds of the recovery in their cases. However, on a number of occasions, Hunter settled such claims without notifying his clients and without authority to do so and then the defendant stole the settlement proceeds, resulting in a total loss amount from this scheme of $109,830.
In announcing the plea, U.S. Attorney Machen, Acting Assistant Director in Charge Smith, and Commissioner White commended the efforts of those who investigated the case from the FBI’s Washington Field Office and the District of Columbia Department of Insurance, Securities, and Banking. They also praised those who worked on the case from the U.S. Attorney’s Office, including Legal Assistant Donna Galindo, former Assistant U.S. Attorney Courtney G. Saleski, and Assistant U.S. Attorney Matt Graves, who is prosecuting the matter.

Owner of Liberty Mortgage Company in Elk Grove Convicted in Multi-Million-Dollar Mortgage Fraud Scheme

SACRAMENTO, CA—After a 10-day trial, a federal jury found Hoda Samuel, 60, of Elk Grove, guilty of a conspiracy to commit mortgage fraud and of 30 individual counts of mail fraud.
According to evidence presented at trial, Samuel, a licensed real estate broker, was the owner and principal operator of Liberty Real Estate & Investment Company, a real estate agency, and Liberty Mortgage Company, a mortgage brokerage business. Between April 5, 2006 and February 26, 2007, Samuel’s companies facilitated 30 residential real estate transactions that defrauded the lending institutions that provided the financing. In all 30 of these transactions, Samuel served as the real estate broker for the purchaser. In at least 15 of them, she also represented the seller. In 29 of the transactions, Liberty Mortgage Company secured the financing for the purchaser. At least 28 of the properties went into foreclosure, resulting in a loss to lenders of more than $5.5 million.
As part of the scheme, Samuel’s co-conspirators and employees at Liberty Mortgage prepared loan applications containing false information that misrepresented the buyers’ ability to pay back loans and/or overstated or falsified their employment, income, assets, and liabilities. When a lender would attempt to verify the information by calling the purported employer, the phone number on the application led to a Liberty employee or associate who falsely verified the information.
The offers reflected in the purchase contracts prepared by Liberty Real Estate overstated the value of the properties, often exceeding the actual asking prices by $15,000 to $40,000. The excess amounts were paid back to the buyers out of escrow, disguised as payments for fictional repairs and remodeling to the properties. With respect to particular transactions, Samuel herself made misrepresentations to the effect that the property buyers had disabled family members and needed to remodel the properties to make them wheelchair accessible. The repairs and remodeling were seldom, if ever, done, and the lenders were unaware that the true purchase price for each property was below the total amount funded.
Eight of Samuel’s associates in the scheme pleaded guilty prior to trial and are awaiting sentencing.
“Mortgage fraud schemes of the sort perpetrated by Hoda Samuel and her co-defendants wreaked havoc in this region,” U.S. Attorney Wagner said. “As a result of this prosecution, she and her co-defendants are facing significant prison terms. Taking fraudsters out of the residential real estate industry and sending them to prison has been one of this office’s top priorities. Last year, we indicted more mortgage fraud defendants than any other U.S. Attorney’s Office in the country, and we are not done yet.”
This case is the product of an investigation by the FBI and IRS-Criminal Investigation. Assistant U.S. Attorneys Philip A. Ferrari and Todd A. Pickles are prosecuting the case.
Samuels is scheduled to be sentenced by United States District Judge John A. Mendez on April 30, 2013. She faces a maximum sentence of 20 years in prison for each count of mail fraud. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory sentencing factors and the Federal Sentencing Guidelines, which take into account a number of variables.

Former Xpress Flex Inc. and Payroll America Inc. Owner Sentenced to 51 Months for Fraud and Filing a False Tax Return

BOISE—Michael Wayne Davis, II, 46, of Raleigh, North Carolina, formerly of Eagle, Idaho, was sentenced yesterday to 51 months in prison for wire fraud and filing a false tax return, U.S. Attorney Wendy J. Olson and Assistant Attorney General for the Justice Department’s Tax Division Kathryn Keneally announced. Chief U.S. District Judge B. Lynn Winmill also ordered Davis to serve three years of supervised release following his prison term and pay $999,930.90 in restitution—$954,640.90 to Xpress Flex victims and $45,290 to the IRS for the tax loss. Davis pleaded guilty to the charges on September 10, 2012.
According to court documents, in 2009 and 2010, Davis owned and operated Xpress Flex Inc., a Boise, Idaho company that administered, on behalf of employer-clients, flexible benefits plans for tax-free, qualified benefits, such as health care and dependent care. Pursuant to those plans, Xpress Flex received monetary contributions from its employer-clients of pre-tax withholdings from their employees’ paychecks. These funds were deposited into Xpress Flex bank accounts and set aside to pay the claims of employee-participants when they came due. According to court documents, Davis misappropriated $954,640.90 of Xpress Flex client funds and used them to pay personal credit card charges and the business expenses of his other company, Payroll America Inc. He did so without the knowledge or authorization of the employer-clients and their employees and contrary to representations in plan documents and contracts that he would safeguard the deposits and use them only to pay employee claims.
Court documents also showed that from 1994 through 2009, Davis owned and operated Payroll America in Boise, Idaho. Payroll America provided payroll administration and payroll tax filing services to its employer-clients. Pursuant to contract documents, employer-clients would deposit sufficient funds with Payroll America to meet their payroll and payroll tax obligations, which Payroll America would pay when they came due. According to court documents, in March and April 2007, Davis misappropriated $2 million of Payroll America employer-client funds, wired them into his E*Trade brokerage account, and then invested the funds in the stock market. Davis did so without the knowledge or authorization of the employer-clients of Payroll America, contrary to representations in contract documents that he would safeguard the funds and use them only to pay payroll and payroll taxes.
Davis’ E*Trade investments generated approximately $192,436 in capital gains income. According to court documents, Davis wired this money into his and his wife’s personal checking account. The wire transfer was annotated “E-Trade Gains.” However, Davis intentionally failed to report capital gains income from E*Trade investments on his 2007 or 2008 tax returns, causing a tax loss of $45,290. For this conduct, Davis pleaded guilty to one count of filing a false tax return.
“I’m very pleased that my office, with the assistance of the Justice Department’s Tax Division, and federal law enforcement partners were able to bring Mr. Davis to justice,” said Olson. “Those who are entrusted to manage others’ money must ensure that it is safe and available for its intended purpose, not diverted for personal gain.”
“This sentencing sends a clear message: businesses owners who misuse their positions of trust and divert funds for their own personal use will be held accountable,” said Lilia E. Ruiz, IRS-Criminal Investigation Acting Special Agent in Charge for the State of Idaho.
The case was investigated by the Federal Bureau of Investigation, the U.S. Department of Labor, Employee Benefits Security Administration, and Internal Revenue Service-Criminal Investigation.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices, and state and local partners, it is the broadest coalition of law enforcement, investigatory, and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state, and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions, and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.

Former Hedge Fund Principal Pleads Guilty to Manhattan Federal Court to Stealing Over $1 Million in Investor Funds

Preet Bharara, the United States Attorney for the Southern District of New York, announced that Berton Hochfeld, the former Manager of Hochfeld Capital Management LLC (Hochfeld Capital), pled guilty today in Manhattan federal court to securities fraud and wire fraud charges in connection with an investment scheme in which he stole more than $1 million from investors. Hochfeld pled guilty before U.S. District Judge Paul A. Crotty.
Manhattan U.S. Attorney Preet Bharara said, “Berton Hochfeld may have had all the trappings of being a sophisticated investment adviser in control of a limited liability corporation, a partnership and a hedge fund, but at the end of the day, he was simply a thief who stole money from the investors who trusted him. Investment fraud is a serious offense that damages investor confidence and the markets, and we will continue to prosecute it aggressively.”
According to the charging instruments in this case and statements made in open court today at the plea proceeding:
Hochfeld was the manager and organizer of Hochfeld Capital, a limited liability company incorporated in Delaware that, at various times, maintained an office in New York, New York. Hochfeld Capital, in turn, served as the General Partner of the Heppelwhite Fund L.P. (the “Heppelwhite Fund”), a hedge fund that was formed to invest in publicly traded securities, mainly in the technology sector. In connection with the management of the Heppelwhite Fund, Hochfeld made false representations to investors regarding their investments, and misappropriated their money.
For example, by December 2010, Hochfeld was aware that Hochfeld Capital’s internal accounting for the Heppelwhite Fund reflected an inflated net asset value (NAV), as compared to the value reflected in the books of the prime broker where the fund’s assets were actually located. Despite his knowledge of the disparity, Hochfeld caused monthly statements to be sent to Heppelwhite Fund investors that reflected the inflated NAV calculated by internal accounting records.
From April 2011 through October 2012, Hochfeld also withdrew money from the Heppelwhite Fund for his own personal use, ultimately misappropriating more than $1 million. During this period, at Hochfeld’s direction, monthly account statements were provided to Heppelwhite Fund investors that falsely represented the fund’s value by failing to account for the money that he had withdrawn. At a meeting in October 2012, Hochfeld admitted to certain investors that he had taken more than $1 million from the Heppelwhite Fund and that he spent portions of that money on antiques and vacations.

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Hochfeld, 66, of Stamford, Connecticut, pled guilty to one count of securities fraud and one count of wire fraud. He faces a maximum sentence of 20 years in prison on each count. The defendant also faces a fine of the greater of $5 million or twice the gross gain or gross loss from the offense on the securities fraud charge, as well as a fine of a lesser amount on the wire fraud charge. In connection with his guilty plea, Hochfeld agreed to forfeit the illegal proceeds of his crimes and will be ordered to pay restitution to the victims of his offenses.
HOCHFELD is scheduled to be sentenced by Judge Crotty on June 27, 2013, at 3:00 p.m.
Mr. Bharara praised the investigative work of the FBI. He also thanked the U.S. Securities and Exchange Commission for their assistance.
This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force, on which Mr. Bharara serves as a Co-Chair of the Securities and Commodities Fraud Working Group. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch and, with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorney Jillian Berman is in charge of the prosecution.

Newark Man Sentenced to 150 Months in Prison for Carjacking and Related Crimes

NEWARK—A Newark man was sentenced today to 150 months in prison for his role in an April 2011 carjacking of a victim at gunpoint in Elizabeth, New Jersey, U.S. Attorney Paul J. Fishman announced.
Jirrod Parker, 25, previously pleaded guilty before U.S. District Judge Susan D. Wigenton to an indictment charging him with one count each of theft of a motor vehicle by force, violence, and intimidation; use of a firearm in furtherance of a crime of violence; and being a felon in possession of a firearm. Judge Wigenton imposed the sentence today in Newark federal court.
According to documents filed in this case and statements made in court:
On April 10, 2011, Parker approached an individual who was walking toward his parked Lexus. Parker pointed a semi-automatic pistol at the individual’s chest and demanded “everything,” including the victim’s car keys and wallet. Parker then drove off in the victim’s Lexus sedan. Shortly thereafter, Parker crashed the stolen Lexus during pursuit by the Elizabeth Police and fled on foot through a residential area, with a police officer giving chase. Parker attempted to evade the police by breaking into a home but was apprehended in front of the residence.
In addition to the prison term, Judge Wigenton sentenced Parker to three years of supervised release and ordered him to pay restitution of $7,867.
U.S. Attorney Fishman credited special agents of the FBI’s Violent Crimes/Fugitive Task Force, under the direction of Special Agent in Charge David Velazquez in Newark; the Elizabeth Police Department, under the leadership of Police Director James Cosgrove; and the Union County Prosecutor’s Office, under the direction of Prosecutor Theodore J. Romankow, with the investigation leading to today’s sentence. This case was brought as part of a cooperative effort between federal, state, county, and local law enforcement to address a spike in carjacking and related crimes in northern New Jersey.
The government is represented by Assistant U.S. Attorney Shirley U. Emehelu of the U.S. Attorney’s Office Criminal Division in Newark.

Founder and President of Venture Development Associates Inc. Sentenced to 15 Months in Prison for Wire Fraud

TRENTON—The founder and president of Venture Development Associates Inc. (VDA), a Farmingdale, New Jersey company that presents itself as a provider of corporate financing, was sentenced today to 15 months in prison for defrauding an Illinois man out of nearly $50,000, U.S. Attorney Paul J. Fishman announced.
Michael Peniston, 54, of Farmingdale, previously pleaded guilty before U.S. District Judge Anne E. Thompson to an information charging him with one count of wire fraud in connection with obtaining nearly $50,000 in a false investment scheme from a victim who resided in La Grange, Illinois. As part of his plea agreement, Peniston also agreed to pay back $199,169 to a total of four victims. Judge Thompson imposed the sentence today in Trenton federal court.
According to documents filed in this case and statements made in court:
In February 2008, Peniston, through VDA, presented an agreement to the victim that falsely represented that Peniston would use the victim’s capital to acquire “via lease procedure” a “bank instrument” valued at 500,000,000 Euros. The agreement falsely stated that Peniston would use this bank instrument to purchase “Medium Term Notes” that he would sell at a profit and that he would pay half the profits to the victim investor. That month, in reliance on these false promises, the purported investor made three wire transfers totaling almost $50,000 to a VDA bank account controlled by Peniston.
After these transfers, Peniston and VDA continued to falsely communicate with the investor that the transactions for Medium Term Notes were imminent, and, later, that they had taken place. Later in February, Peniston promised the Illinois investor a $37.4 million payment per week over a period of 40 out of 56 weeks. In April 2008, Peniston sent a letter to the victim stating that the “transaction” had been concluded and the funds had been forwarded to the Bank of New York.
Peniston never acquired a “bank instrument,” nor any Medium Term Notes. Instead, he spent the investor’s money on personal expenditures.
In late July 2011, Peniston again communicated with the Illinois investor, promising him restitution. To follow up that communication, Peniston faxed the victim a copy of a check for $200,000 and a shipping label to make it appear that Peniston was providing these funds to an attorney for payment to the victim. Peniston admitted that he made these communications knowing that they were false.
In addition to the prison term, Judge Thompson sentenced Peniston to three years of supervised release.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Acting Special Agent in Charge David Velazquez in Newark, for the investigation leading to today’s sentence.
The government is represented by Assistant U.S. Attorney John E. Clabby of the U.S. Attorney’s Office Criminal Division in Trenton.

Former Prince George’s County Correctional Officer Pleads Guilty to Obstruction of Justice

WASHINGTON—Anthony McIntosh, a former correctional officer at the Prince George’s County Detention Center in Upper Marlboro, Maryland, today pleaded guilty to obstruction of justice for providing false information about the circumstances surrounding the in-custody death of Ronnie White on June 29, 2008. White, at the time of his death, was being detained on charges related to the death two days earlier of a Prince George’s County police officer.
McIntosh, 49, of Brooklyn, New York, pleaded guilty to a violation of 18 U.S.C. § 1519 for providing false information in a witness statement he submitted to a police detective investigating White’s in-custody death. McIntosh admitted during his guilty plea that when he wrote his witness statement, he omitted material information that was truthful and included information that he knew was false. Specifically, McIntosh claimed in the false witness statement that another officer had discovered White unresponsive in his single-occupant cell and had then summoned McIntosh to the cell. During the guilty plea, McIntosh admitted that, in actuality, he had been the first correctional officer to find White unresponsive in the cell and had failed to call a medical emergency signal as required by the Department of Corrections. McIntosh also admitted that he included in his statement the false claims that he never moved Ronnie White and that he “didn’t know what was going on” when his partner told him that White appeared to be unresponsive.
“Instead of lawfully carrying out his critical public safety responsibilities, Mr. McIntosh used his position to obstruct the search for the truth,” said Assistant Attorney General for the Civil Rights Division Thomas E. Perez. “The Justice Department will continue to vigorously prosecute officers who cross the line and engage in criminal misconduct.”
McIntosh faces a maximum penalty of 20 years in prison and a fine of $250,000. Sentencing is set for April 8, 2013, before U.S. District Judge Alexander Williams, Jr.
The case was investigated by the Baltimore Division of the FBI and was prosecuted by Special Litigation Counsel Forrest Christian and Trial Attorney Ali Ahmad of the Civil Rights Division of the Department of Justice, with the assistance of the U.S. Attorney’s Office for the District of Maryland.

Former Police Officer in North Dakota Arrested on Federal Civil Rights Violation

WASHINGTON—The Justice Department announced today that Lindrith Tsoodle, 57, a former officer with the Three Affiliated Tribes Police Department, was apprehended and arrested on the Rocky Boy Reservation in Montana yesterday in relation to his indictment on civil rights and obstruction violations.
Tsoodle was indicted on December 13, 2012. The indictment alleges that, on December 6, 2010, Tsoodle, while acting in his capacity as a police officer, assaulted “T.K.” during an arrest while T.K. was handcuffed, thereby violating his civil rights. The indictment alleges that Tsoodle slammed T.K. against a wall, excessively tightened his handcuffs, shoved him into a police car, used Oleoresin Capsicum spray on him, and struck him repeatedly, both with his body and with a baton. The indictment further charges that T.K. suffered bodily injury as a result of Tsoodle’s use of excessive force.
According to the indictment, following the assault on T.K., Tsoodle attempted to convince a witness not to report the incident to other law-enforcement officials and lied to a federal agent about the assault.
Tsoodle is also charged with assaulting “S.L.” during a separate arrest. The indictment alleges that, on November 20, 2010, while S.L. was in handcuffs, Tsoodle twisted his neck, shoved him to the ground, and kneed him in the chest, thereby violating his civil rights.
An indictment is merely an accusation, and the defendant is presumed innocent unless proven guilty.
This case is being investigated by the FBI in North Dakota and is being prosecuted by Special Litigation Counsel Gerard V. Hogan and Trial Attorney Dana Mulhauser of the Civil Rights Division of the U.S. Department of Justice.

New Jersey Man Pleads Guilty to and is Sentenced for Threatening to Kill the CEO and President of Wegmans

ROCHESTER, NY—U.S. Attorney William J. Hochul, Jr. announced today that Hans Ni, 31, of Trenton, New Jersey, pleaded guilty to sending threatening interstate e-mails to the CEO and president of Wegmans Food Market before U.S. District Court Judge Charles J. Siragusa. The defendant was then sentenced to five years’ probation by Judge Siragusa.
Assistant U.S. Attorney Richard A. Resnick, who handled the case, stated that Ni is a former Wegmans employee in Princeton, New Jersey. On July 27, 2011, the defendant sent threatening e-mails from the Plainsboro Public Library in Plainsboro, New Jersey, to both the president and chief execute officer of Wegmans in Rochester, impersonating a manager of a Wegmans location in New Jersey.
In the e-mail to the president of Wegmans, Ni stated, “I am going to kill you [first name of president]. I am going to murder you—you race traitor.” In the e-mail to the CEO of Wegmans, Ni stated that “I am going to kill you [first name of CEO]. You are a race traitor. I am going to murder you.” The defendant stated at sentencing that he never intended to harm the CEO or president of Wegmans; rather he was attempting to get the person he impersonated in the e-mails, his former supervisor at Wegmans, in trouble.
The plea and sentencing are the culmination of an investigation by the Federal Bureau of Investigation, under the direction of Christopher M. Piehota, Special Agent in Charge.

Victory Pharma, Inc. of San Diego Pays $11.4 Million to Resolve Kickback Allegations in Connection with Promotion of its Drugs

WASHINGTON—Victory Pharma Inc., a specialty pharmaceutical company headquartered in San Diego, has agreed to pay $11,420,743 to resolve federal civil and criminal liability arising from its marketing of the pharmaceutical products Naprelan, Xodol, Fexmid, and Dolgic, the Justice Department announced today. Under the agreement announced today, Victory entered into a deferred prosecution agreement and paid a criminal forfeiture of $1.4 million to resolve federal Anti-Kickback Statute allegations and paid $9,938,310 to resolve False Claims Act allegations.
The settlement resolves allegations that Victory engaged in a scheme to promote its drugs by paying kickbacks to doctors to induce them to write prescriptions for Victory’s products, including prescriptions for patients covered by Medicare and other federal health insurance programs. The kickbacks included tickets to professional and collegiate sporting events; tickets to concerts and plays; spa outings; golf and ski outings; dinners at expensive restaurants; and numerous other out-of-office events. Victory also encouraged its sales representatives to schedule paid “preceptorships,” which involved sales representatives “shadowing” doctors in their offices. The settlement also resolves allegations that Victory improperly used these preceptorships to induce doctors to prescribe Victory’s products.
“Kickback schemes undermine the integrity of medical decisions, subvert the health marketplace and waste taxpayer dollars,” said Stuart F. Delery, Principal Deputy Assistant Attorney General for the Civil Division. “We will continue to hold accountable those who refuse to play by the rules and provide illegal incentives to influence the decision making of health care providers.”
“This resolution underscores the need for physicians to make treatment decisions based on their own independent medical judgment, without being influenced by kickbacks or other improper benefits,” said Laura E. Duffy, U.S. Attorney for the Southern District of California. “Protecting taxpayers from health care fraud is a priority of this office. We will continue to work closely with our investigative partners in taking both criminal and civil measures to combat health care fraud.”
The settlement resolves a False Claims Act lawsuit filed in the Southern District of California by Chad Miller, a former sales representative for Victory. The whistleblower, or qui tam, provisions of the False Claims Act permit the whistleblower (or relator) to obtain a portion of the proceeds obtained by the federal government. As part of today’s resolution, Mr. Miller will receive $1.7 million.
“Patients expect health care providers to be concerned only with patients’ best medical interests,” said Glenn R. Ferry, Special Agent in Charge for the U.S. Department of Health and Human Services Office of Inspector General Los Angeles region. “Financial kickbacks betray that patient trust and taxpayers’ expectation that federal and state health dollars be put only to the wisest use.”
FBI Special Agent in Charge Daphne Hearn commented, “Many laws of this nation are put in place to protect our citizens from corrupt practices that may endanger our health and safety. When individuals or businesses operate outside of the fence in order to turn a bigger profit the FBI will pursue them in the justice system.”
Chris Hendrickson, Special Agent in Charge, Western Field Office, Defense Criminal Investigative Service, stated: “The Department of Defense is committed to its partnership with the Department of Justice and other federal and state enforcement agencies to aggressively pursue those who take advantage of taxpayer-funded health care systems for illicit gain. Doctors providing services to our military members and their families should be free from undue influence in prescribing medicines and other care decisions, and DCIS will act swiftly against those who engage in these illegal and unethical acts.”
This settlement is the result of a coordinated effort by the Department of Justice, Civil Division, Commercial Litigation Branch; the U.S. Attorney’s Office for the Southern District of California; the FBI; and the Offices of Inspectors General for Health and Human Services, the Department of Defense, the Department of Labor, the U.S. Postal Service, the Veteran’s Administration, and the Office of Personnel Management.
This resolution is part of the government’s emphasis on combating health care fraud and another step for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced by Attorney General Eric Holder and Kathleen Sebelius, Secretary of the Department of Health and Human Services in May 2009. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in that effort is the False Claims Act, which the Justice Department has used to recover $10.1 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department’s total recoveries in False Claims Act cases since January 2009 are over $13.9 billion.

Felon from Maine Sentenced for Transporting Owensboro Girl Across State Lines with Intent to Engage in Sexual Activity

OWENSBORO, KY—Archie M. Whalen, from Hancock County, Maine, was sentenced to 30 years in federal prison today by Chief District Judge Joseph H. McKinley, Jr. for transporting a minor across state lines with the intent to engage in criminal sexual activity, announced David J. Hale, United States Attorney for the Western District of Kentucky.
A federal jury in Owensboro, Kentucky deliberated approximately one hour on July 26, 2012, before finding Whalen, age 46, guilty of all charges.
According to testimony presented during the three-day trial, Whalen took a 13-year-old Owensboro girl from her home on September 26, 2009. A multi-state Amber Alert was issued and within 24 hours, and the minor girl was found with Whalen in Sturgeon Bay, Wisconsin, on September 27, 2009.
Whalen was arrested after a Sturgeon Bay Police officer observed the Maine license plate on the vehicle Whalen was driving and conducted a felony traffic stop. The Sturgeon Bay Police acted after being notified by the FBI in Kentucky to be on the lookout for Whalen’s red Ford Explorer with a Maine license plate. According to the minor girl’s mother, a text message on their shared cell phone helped police identify Whalen. The minor girl and her mother had met Whalen while they briefly lived in Maine earlier that month. After the Amber Alert was issued, employees at a McDonald’s in Breckenridge County alerted their local Sheriff’s office that they believed Whalen and the victim had been in the restaurant around 5:30 a.m. Surveillance video obtained by the Breckenridge County Sheriff’s Office and provided to Daviess County authorities was used to confirm Whalen’s identity and that the missing minor was with him. When Whalen’s Maine plate was run by a police officer in Sheboygan, Wisconsin, although no traffic stop was done, law enforcement authorities in Kentucky were able to confirm that Whalen was in Wisconsin and likely headed in the direction of Sturgeon Bay, where one of Whalen’s family members lived.
Whalen has a prior state felony conviction for second-degree assault in New York and a prior federal conviction for unlawful possession of a firearm in the U.S. District Court for the District of Maine.
This case was prosecuted by Assistant United States Attorney Marisa J. Ford, and it was investigated by the Daviess County Sheriff’s Office and the Federal Bureau of Investigation, Owensboro Resident Agency, with invaluable assistance and cooperation from the Sturgeon Bay Police Department in Wisconsin; the Hancock County Sheriff’s Department in Maine; the Evidence Response Team in the FBI’s Milwaukee Division; and the Office of the Commonwealth Attorney in Daviess County, Kentucky.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about Internet safety education, please visit www.usdoj.gov/psc.

Operation Stateline Sweep Update: Three Defendants Given Lengthy Sentences and One Defendant Pleads Guilty

TEXARKANA, AR—Conner Eldridge, United States Attorney for the Western District of Arkansas announced today that three men were sentenced and one pled guilty as a result of charges brought during Operation Stateline Sweep, a drug trafficking investigation that took place in 2011. All four of the individuals were part of a 190-count indictment filed in September 2011 that named 66 defendants. The Honorable Susan O. Hickey presided over the cases in federal court in Texarkana, Arkansas.
United States Attorney Eldridge commented, “These sentences are the result of a continued effort to fully prosecute those defendants who were charged as a result of Operation Stateline Sweep. We continue to believe that targeting drug trafficking organizations, many selling drugs near schools and housing facilities, is essential for improving Texarkana and other communities. We remain dedicated to this effort.”
Tavaris Williams, age 28 of Texarkana, Arkansas, was sentenced to 70 months’ imprisonment, six years’ supervised release, and a $100 special assessment. Williams originally plead guilty to distribution of cocaine base within 1000 feet of a public housing authority facility on April 27, 2012. Around December 1, 2010, Williams distributed 22.9675 grams of crack cocaine close to Pinehurst Village in Texarkana, Arkansas.
Derrian Foster, age 32 of Texarkana, Texas, was sentenced to 84 months’ imprisonment, eight years’ supervised release, and a $100 special assessment. Foster pled guilty on August 3, 2012, to distribution of cocaine base within 1000 feet of a public housing authority facility. Around July 8, 2011, Foster, along with another individual, distributed 81.7708 grams of crack cocaine near the Ingrham Homes housing facility.
Adren Brown, age 33 of Texarkana, Texas, was sentenced to 60 months’ imprisonment, three years’ supervised release, and a $100 special assessment. After being indicted, Brown pled guilty on August 3, 2012 to possession of a firearm during a drug trafficking offense. Around July 5, 2011, Brown possessed a .40 caliber semiautomatic pistol while possessing marijuana with the intent to distribute.
Roland Smith, age 25 of Texarkana, Arkansas, pled guilty to one count of the September 2011 indictment, charging possession of crack cocaine with the intent to distribute. Smith has been remanded to custody of the U.S. Marshals Service pending sentencing. According to court documents, Smith possessed a total of 4.8518 grams of crack cocaine.
The cases were investigated by the Bi-State Narcotics Task Force, which is composed of representatives of the Texarkana, Arkansas and the Texarkana, Texas Police Departments; the Miller County Sheriff’s Office; and the FBI. Assistant United States Attorney Matthew Quinn is prosecuting the cases for the United States.

British woman returns to Pakistani jail with newborn

Islamabad, Pakistan (CNN) -- A British woman who was arrested on suspicion of drug trafficking in Pakistan remains in jail with her child, despite concerns about the baby's welfare.

Khadija Shah, 25, of Birmingham gave birth to her daughter, Malaika, a few weeks ago at a hospital in the city of Rawalpindi, an hour's drive from the capital, and was escorted back to jail with the infant only three days later, to the shock and dismay of her lawyer.

"The baby has had constant diarrhea, and Khadija complained that jail attendants are giving her strong medicine that is lethal for such a young child," Shahzad Akbar, legal counsel for Shah, told CNN.

"She would have been able to look after her child if she was granted bail," he said.

CNN has attempted to reach the jail for comment about the claims, but officials have not yet responded to calls. However, jail officials have said in media reports that the baby is receiving proper care.

Read more: $2.6 million in cocaine found in British woman's luggage, Indonesians say

Shah, who denies the charges against her, appeared in court Thursday with her infant daughter.

Pakistani messages to Obama, Romney

The power of one young voice

American women protest in Pakistan

Grasping the child, and barely able to speak through tears, she said she didn't want to give up her daughter, despite the conditions in the jail.

"No, I can't give her to anyone, I can't give her up," Shah told CNN before she was returned to her cell. "It's not that bad," she said of the conditions there.

Still, covering her face and hiding her tears, Shah conceded, "I'm worried about her. ..."

In Pakistan's legal system, mothers can keep their children in jail with them while their cases are heard -- a process that can take years.

Shah, arrested on drug charges in May, was allegedly found carrying more than $5 million worth of heroin before boarding a flight to England from Islamabad.

Read more: Pakistani officials seize drugs shaped like onions

She was six months pregnant and traveling with her 5-year-old son and 4-year-old daughter when airport security detained her at Islamabad airport after a "tipoff," according to her lawyer.

"Shah's (older) children were also incarcerated with her until recently, when they were turned over to their grandparents," Akbar said.

Col. Tauqeer, the commander of the Anti Narcotics Force responsible for Shah's arrest, told CNN that Shah was apprehended after spot checking.

"It was routine checking when we found more than 63 kilos of heroin sewn into embroidered cloth in her bag," Tauqeer said.

The Anti Narcotics Force "followed procedure," according to Tauqeer, and Shah now faces life in prison or the death penalty if convicted of the charges against her.

According to the Anti Narcotics Force, 306 people, including foreign nationals, have been convicted in drug-related cases so far in 2012, and 37 tons of drugs have been seized across the country.

"There are no weaknesses in our case," according to Tauqeer, who said Shah had made two prior trips to Islamabad, during which she probably transported drugs to England.

He said she told law enforcement officers that she had no relatives in Pakistan and that she was there on vacation.

"First she said she had no family, then her relatives arrived from Lahore to take the children; then she said she was married, and (it) turned out she was divorced. There are too many discrepancies in her statements," Tauqeer said.

Shah said that she had no knowledge of carrying drugs and that she was given a bag by a friend to take home to England, her lawyer told CNN. He also denies Tauqeer's claims about prior trips and any discrepancies in Shah's story.

Now, as Shah tends to her infant daughter in jail, her other children are in the UK; taken back, her lawyer says, by their grandmother.

But there is little chance Shah will join them anytime soon. A trial awaits her in Pakistan.

Atlanta courthouse killing suspect denied bail

ATLANTA, Georgia (CNN) -- A judge denied bail Tuesday morning for Brian Nichols, the suspect in the Atlanta killings of a judge, a deputy sheriff, a court reporter and a federal agent.
Chief Magistrate Judge Frank Cox -- of neighboring Cobb County -- presided over the hearing, which was held at the Fulton County Jail where Nichols, 33, is being held in maximum security.
Nichols entered the white, cinder-block jailhouse courtroom to the sound of clicking news cameras. Nearly 20 deputies were on hand.
Nichols wore a blue jump suit and blue slippers. His hands and legs were shackled.
Defense attorneys Chris Adams and Gary Parker said Nichols wished to remain silent.
When the judge asked Nichols whether he had any questions or a statement, Nichols replied: "Not at this time."
Tuesday's appearance was the first time the public has seen Nichols since he was captured Saturday in a suburb northeast of Atlanta.
Prosecutor Michele McCutcheon said the state intended to file four charges of murder -- as well as felony escape charges and "other felonies" -- against Nichols at a later date.
The judge read previous rape charges against Nichols, on which he is being held while prosecutors arrange formal charges on the murders.
"It's really just kind of a place-holding situation," said CNN legal analyst Jeffrey Toobin.
"This will be an investigation of some complexity given the sheer number of crimes that he's likely to be charged with. So this is a process that's only going to get started today and probably will last several months," Toobin said.
After the hearing, Adams spoke to reporters. "This is a time of grief and mourning for the courthouse community," Adams said. "We're going to respect that. There will be plenty of time for us later to lay out our legal arguments and examine the evidence and search for answers in this case."
A few blocks away at Fulton County Courthouse, employees attended a memorial service for the three people killed at the courthouse on Friday morning.

Nichols statement

On Monday, Fulton County District Attorney Paul Howard told CNN's Paula Zahn that Nichols had made a statement to police after his arrest Saturday.
"I can say he gave a statement, and he was cooperative," Howard said, adding that his duties as prosecutor prevented him from going into further detail.
Howard said he saw Nichols shortly after he was taken into custody and he appeared to be "someone who was proud of what he had done -- that he did not show remorse."
"From the responses that I was able to see personally, that's the impression that I received," the district attorney said.
Prosecutors have not said if they will seek the death penalty against Nichols, but Howard said the shootings were among "the most horrendous crimes" local law enforcement had ever seen.
A judge declared a mistrial Monday in Nichols' retrial on the rape, aggravated sodomy and false imprisonment charges. Nichols' retrial was in progress when the shootings occurred.
At the courthouse on Friday, police said Nichols overpowered a deputy sheriff while they were en route to his retrial. He escaped and walked to a courtroom, shooting and killing Fulton County Superior Court Judge Rowland W. Barnes and court reporter Julie Ann Brandau, police said. During his escape Nichols also shot and killed sheriff's deputy Sgt. Hoyt Teasley.
Police said Nichols then carjacked several vehicles -- injuring a local newspaper reporter -- and then boarded a MARTA subway train north to Atlanta's Buckhead neighborhood.
Authorities said Nichols then shot and killed U.S. Immigration and Customs Enforcement agent David Wilhelm at his home which was under construction near the MARTA station. Next, Nichols stole Wilhelm's truck -- police said -- and drove it to an apartment complex to the northeast in Gwinnett County. There, he took Ashley Smith, 26, hostage, police said. (Full story)
Smith said she was taken captive early Saturday morning, but she gained Nichols' trust by talking to him about her 5-year-old daughter, God and hope. He later gave himself up to police outside Smith's apartment. (Full story)
Smith downplayed her efforts Monday night.
"Throughout my time with Mr. Nichols, I continued to rely [on] my faith in God. God has helped me through tough times before, and he'll help me now," she told reporters at a news conference in her hometown of Augusta, Georgia.

Trenton, New Jersey, mayor arrested on corruption charges

(CNN) -- The mayor of New Jersey's capital city was arrested Monday on corruption charges after being accused of accepting bribes during an undercover operation, authorities said.

The charges against Trenton Mayor Tony Mack, 46, his brother, Ralphiel Mack, 39, and business associate Joseph A. "JoJo" Giorgianni, 63, stem from an alleged kickback scheme to sell city-owned land to investors for significantly less than the assessed value.

Mack and his brother, the head football coach at Trenton Central High School, both were released on $150,000 bail and slipped into a city vehicle after a court appearance. They were ordered to surrender their passports.

"The evidence appears to be, at this point, weak as far as Mayor Mack is concerned," Mark Davis, Tony Mack's attorney, told CNN on Monday evening. "The complaint is just full of allegations, that's all they are."

A bond hearing for Giorgianni, a sandwich shop owner, was postponed because of unrelated drug conspiracy charges.

The investigation "revealed evidence of a conspiracy among these defendants and others to corrupt certain functions of Trenton City government in favor of purported developer seeking to build a parking garage on city owned property in exchange for cash payments totaling approximately $119,000," according to a complaint filed in federal court.

From the archives: Ex-mayor in New Jersey gets two years in prison

The three defendants -- who were charged specifically with conspiracy to corrupt commerce by extortion -- employed intermediaries, "used code words and limited discussions of the scheme over the telephone" to avoid detection, the complaint said.

For example, Giorgianni would use the term "Uncle Remus" in conversations with the mayor to connote when he had received a cash payment, U.S. Attorney Paul Fishman said.

The charges stemmed from a two-year FBI investigation that incorporated two informants cooperating with law enforcement. Fishman said at least one of those moles wore a wire to record conversations for the FBI.

At a news conference before the bond hearing, Fishman pointed to repeated cases of corruption that his office has uncovered.

"Time and again, we have seen public officials in New Jersey who are all too willing to sell their power and betray the public's trust," he said.

Any trial related to Mack's case would not likely occur until next year, according to Fishman.

Mack's office declined to comment when reached by CNN. But Davis, the mayor's lawyer, stressed his client hasn't been indicted yet and should "continue to enjoy the presumption of innocence."

Based on discussions they've had, Davis said his "understanding is that (Mack) is going to remain in his (mayoral) post and continue in his official duties," as the legal case proceeds against him. The lawyer said he expects a grand jury will consider the case within 30 days.

In a separate complaint that Fishman stressed was not connected to the Macks, the government charged Giorgianni and eight others with conspiracy to distribute the highly addictive prescription painkiller oxycodone.

Fishman said Giorgianni used his business, JoJo's Steakhouse, as a front for a drug dealing operation. He's accused of storing the narcotics there, distributing the pills to dealers, then processing the cash exchanged for the painkillers.

Two months ago, agents raided the homes of Mack, his brother, and Giorgianni, before raiding Trenton's City Hall the next day.

Mack responded to the July raids by saying he had "not violated the public trust in any way, nor have I violated any of my public duties."

A Democrat who began his term in July 2010, Mack has been beleaguered by questions about public finance and accusations of cronyism.

In May, Deputy Mayor Paul Sigmund IV was arrested and charged with heroin possession and assaulting a police officer, which led to Sigmund's prompt resignation.

Illinois woman accused of killing son, girl as she babysat them

CNN) -- A Chicago-area woman has been charged with killing her 5-year-old son and a 7-year-old girl as she babysat them, allegedly stabbing each dozens of times in a bedroom this week as they pleaded for their lives, authorities say.

Elzbieta Plackowska, 40, of Naperville, Illinois, allegedly told police she instructed her son Justin Plackowska and the girl, Olivia Dworakowski, to kneel and pray before she fatally stabbed them and two dogs at the girl's home on Tuesday evening, Naperville police said.

Plackowska -- charged Thursday with two counts of first-degree murder -- allegedly gave investigators a number of reasons why she killed the children, the most recent of which was that she was upset with her husband and wanted to cause him pain, according to police.

"She began stabbing her son Justin and told him he was going to heaven tonight," DuPage County prosecutor Bob Berlin told reporters Thursday, citing Plackowska's alleged statements to police. "He pleaded for his life and told her to stop, but she continued stabbing him until he was dead."

Plackowska was being held Thursday without opportunity for bail. If convicted, she would face a mandatory sentence of life in prison with no possibility of parole.

CNN's attempts to reach lawyer Mike Mara, a DuPage County public defender representing Plackowska, weren't immediately successful.

Police officers found the children's bodies in Olivia's home Tuesday night after Elzbieta Plackowska, covered in blood, arrived at a nearby friend's house and claimed she had been robbed, police said.

The friend called police. Around the same time, Olivia's mother called police to say she had come home from work and couldn't enter the house because there was a strange lock on the door, and that she couldn't find Plackowska or the children, Berlin said.

Officers forced entry into the home and "walked into a scene of unimaginable horror," finding the bodies on the floor of the master bedroom, Berlin said.

Investigators said Plackowska offered several explanations, including that she believed an intruder killed the children, police said. Later, she told police that the children had evil inside them and she needed to drive the devil out, authorities said.

"She ultimately admitted that she had lied to the police in her earlier statements and stated she was angry with her husband," Berlin said.

Plackowska told investigators that she told the children to get ready for bed, and the kids entered the master bedroom, Berlin said. Plackowska said she then went to the kitchen, took two knives, entered the bedroom and told the children to kneel on the floor and pray, according to Berlin.

She told police she stabbed Justin repeatedly, and then stabbed Olivia because Olivia saw her attacking Justin, according to Berlin. She said Olivia, like Justin, pleaded for her life, Berlin said.

Police said Justin was stabbed about 100 times, and Olivia about 50 times.

"She did not express any remorse," Berlin said.

Naperville Police Chief Bob Marshall told reporters that the "senseless taking of the lives of these two children defies logic, and our community is grieving."

In all my years of law enforcement, this is the most gruesome and horrific crime scene that I have seen," Marshall said at the news conference.

Plackowska told police she was upset with her husband in part because he was gone most days, working as a truck driver, and that she felt he didn't treat her as she deserved.

Plackowska is awaiting a November 21 arraignment.

Prosecutors: NYPD officer conspired to kidnap, cook, eat women

Editor's note: Gilberto Valle, a New York police officer accused of conspiring to kidnap, rape, torture and cook a number of women and eat their body parts, has been arrested and charged in federal court.

Here are the latest developments on this story.
[Updated at 9:11 p.m ET] A federal prosecutor and defense attorney argued in court Thursday whether a New York police officer's sexually deviant online conversations amounted to "idle, harmless talk" or a real threat to scores of women.
Prosecutor Hadassa Waxman contended that Gilberto Valle conducted online conversations "in gruesome detail," staked out would-be victims from his police car and had taken "affirmative steps" to carry out his "operational plan."
"This is not a fantasy," Waxman said during the suspect's initial court appearance. "Each name is real."
Defense lawyer Julia Gatto called the accusations against her client "exaggerated," saying Valle participated in one of thousands of fetish chat rooms online in which people "talk about unreal things." What they discuss may be sexually deviant, but she stressed that no one was physically harmed by her client, who is the father of a 1-year-old child.
"The best (the government) alleges is idle, harmless talk," Gatto said.
Judge Henry Pitman sided with the prosecution, ordering Valle to remain detained pending trial. He described the allegations as "extremely disturbing" descriptions of "depraved conduct."
What made it especially troubling, the judge said, was that the suspect is a law enforcement officer and "he carried a gun."
[Updated at 7:20 p.m. ET] Valle, 28, is being held in federal custody without bail after not entering a plea Thursday during a federal court session in Manhattan.
The New York police officer is charged with one count of conspiracy to commit kidnapping and one count of illegally accessing and getting information from the National Crime Information Center database.
At Thursday's court proceeding, his lawyer Julia Gatto said the alleged plans discovered by authorities on Valle's computer amounted to "just talk."
"At worse, these are sexual fantasies with people he knows," the defense attorney said.
[Updated at 5:08 p.m. ET] A New York police officer accused of conspiring to kidnap, rape, torture and cook a number of women and eat their body parts has been arrested , the U.S. Attorney's Office in Manhattan said Thursday.
Valle, a six-year NYPD veteran, was arrested Wednesday at his home in Queens. He is accused of illegally accessing a national crime database to locate potential targets, scouting potential targets at their homes and workplaces, and exchanging e-mails and instant messages with alleged co-conspirators about plans to target women, the attorney's office said.

From OkCupid: Accused NYPD officer Gilberto Valle, 28.

“Gilberto Valle's alleged plans to kidnap women so that they could be raped, tortured, killed, cooked, and cannibalized shock the conscience," Manhattan U.S. Attorney Preet Bharara said. "This case is all the more disturbing when you consider Valle's position as a New York City police officer and his sworn duty to serve and protect. Our investigation is ongoing."
According to a law enforcement source with knowledge of the investigation, Valle – who the source says has a clean record - apparently discussed the plans with other men on a website for people who fantasize about cannibalism. Authorities have no evidence he planned to carry out any of the acts he allegedly plotted with others on the online fantasy website, a law enforcement source says.
The NYPD has suspended him without pay, a department spokeswoman said Thursday.
A criminal complaint filed in federal court says Valle was in contact with at least two women mentioned in his plans, though FBI spokesman J. Peter Donald told CNN the agency has "no information to believe Mr. Valle harmed anyone at this time."
The investigation began in September when the FBI learned that Valle was sending e-mails and instant messages from his home computer, detailing his plans, the bureau said.
A search of his computer revealed a database of "at least 100 women and containing at least one photograph of each woman," according to a statement from Bharara's office. "The computer also contained personal information about some of these women – including relevant addresses, physical descriptions and photographs – and electronic communications in which Valle and co-conspirators detailed their plans."
The FBI declined to say how it learned of Valle's electronic communications. A law enforcement source told CNN that Valle's estranged wife contacted authorities after finding pornography on his computer.
According to the court documents, the computer contained a document that Valle allegedly created in July, containing an action plan to cook a certain woman that authorities identify as “Victim 1.” The title, authorities say, was “Abducting and Cooking [Victim 1]: a Blueprint.”
The plan, which had information about the woman’s name, date of birth, height, weight and bra size, has a section called “Materials Needed,” in which Valle allegedly wrote:
“Car (I have it)
Chloroform (refer to website for directions)
Rope (Strongest kind to tie her up."
The court documents say Valle also exchanged online messages with an alleged co-conspirator about planning to abduct and cook Victim 1. In one of the exchanges, according to the court documents, Valle allegedly wrote, “She does look tasty, doesn’t she?”
“You do know if we don’t waste any of her there is nearly 75 lbs of food there,” the other person replied, according to the court documents.
The complaint also says Valle negotiated in February with a different person on a price for Valle to kidnap a different woman, whom the complaint identifies only as Victim 2. Valle wrote of kidnapping the woman for the alleged co-conspirator for $5,000, and resisted the co-conspirator’s attempt to lower the price, the complaint says.
“Like I said this is very risky and will ruin my life if I am caught,” Valle wrote, according to the complaint. “I really need the money and I can’t take under $5,000 for [Victim 2].”
The complaint also accuses Valle of illegally getting information about a third woman, Victim 3, from the National Crime Information Center database. The name of that woman matched a name that investigators found in Valle’s alleged files of women on his home computer, the complaint says.
The women in Valle's alleged database live in the United States and overseas, according to a law enforcement source with knowledge of the investigation. At least three of them know Valle, another law enforcement source said. Court documents show one of the alleged targets dined with Valle at a Maryland restaurant.
The 100 women are in the process of being identified, then notified by federal and local authorities.