Last Updated Friday, March 05, 2021, at 1:52 PM
Every Friday, The Criminal Lawyer Group publishes a digest of the latest federal prosecutions nationally. Our goal is to keep the public informed as to recent events in federal courts around the country.
Unless otherwise disclosed, none of the defendants mentioned in these summaries are clients of our firm.
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FRIDAY, March 05, 2021
I. Florida Pediatrician Detained on Federal Child Pornography Possession Charge
Today, a federal magistrate judge in Ft. Lauderdale ordered South Florida pediatrician Michael Mizrachy, 49, of Parkland, Florida, held without bond pending trial on a federal charge of possession of child pornography. During a hearing on March 1, 2021, in Ft. Lauderdale, U.S. Magistrate Judge Alicia O. Valle ordered pre-trial detention for Mizrachy, meaning he will remain in custody pending his federal trial. If convicted on the federal charge, Mizrachy faces up to 20 years in prison. He also faces a pending state criminal case in connection with the alleged conduct.
According to the federal criminal complaint affidavit, in June 2020, the South Florida Internet Crimes Against Children Task Force received a CyberTip cyber tip from the National Center for Missing and Exploited Children about files depicting child pornography being uploaded to an e-mail account, including a video of a prepubescent child being sexually abused.
An investigation led law enforcement to Mizrachy, who worked as a pediatrician in Broward County, Florida. The affidavit alleges that during the execution of a search warrant at Mizrachy’s home in Parkland, Florida, law enforcement officers obtained evidence that Mizrachy used an instant messenger application to obtain child pornography and communicate with minors about sex.
II. Apprehended Fugitive Charged in Second Fraud Scheme
On March 1, 2021, Joseph Albert Corey appeared in federal court to face an indictment filed December 15, 2020, charging him with wire fraud, conspiracy to commit wire fraud, and money laundering. The charge was announced by Acting U.S. Attorney Stephanie Hinds and FBI Special Agent in Charge Craig D. Fair. Corey also re-appeared on a 2019 federal indictment for mail fraud, to which he had already pleaded guilty but had absconded in February 2020 before sentencing.
According to the new indictment (CR 20-481 RS), between March 2019 and October 2020, Corey, 56 and last known to live in Los Angeles, engaged in a fraud scheme that involved impersonating different physicians and applying for loans in the physicians’ names. The applications sought loans purportedly to purchase expensive medical devices. The indictment outlines that once a fraudulent loan application was approved for a loan, Corey directed the lender to deposit the funds in a bank account set up by Corey in a deceptive name, one that closely resembled or was identical to that of a legitimate medical-device supply company.
After the lender deposited the money loaned for the medical device purchase into the apparent medical-device supplier’s bank account, the indictment alleges that Corey withdrew the money and purchased gold. The gold purchase obscured the financial trail of the funds, laundering the money for Corey. The indictment alleges three different executions of this scheme – twice in April 2019 and once in August 2020 after Corey pleaded guilty to the previous fraud and had absconded – that netted more than $300,000.
III. Federal Employee Arrested on Indictment Alleging He Accepted Bribes, Kickbacks for Approving No-Bid Work
A U.S. Forest Service employee was arrested on March 1, 2021, on a federal grand jury indictment charging him with illegally directing nearly $900,000 in no-bid Forest Service vehicle repair and maintenance work to a San Bernardino County, California, auto body repair shop that illicitly paid him more than $360,000 in bribes and kickbacks. Francisco Isaias, 38, of San Bernardino, surrendered this morning to authorities and is expected to be arraigned this afternoon on seven counts of honest services wire fraud and 12 counts of conflict of interest.
A second defendant in this case – Joaquin Perez, 44, of Rancho Cucamonga, the operator of JP’s Collision and Auto Body Center, Inc., a Bloomington-based car repair shop – was arrested on Feb. 25. Both Perez and JP’s Auto have been charged in this case with seven counts of honest services wire fraud. Federal prosecutors have issued a summons for JP’s Auto, the corporate defendant. According to the indictment returned February 24, 2021, the defendants executed a scheme to defraud the U.S. Forest Service of its right to the honest performance of Isaias’ duties as the agency’s fleet maintenance inspector.
As part of his job duties, Isaias selected the businesses that would maintain and repair Forest Service vehicles and approved specific expenditures related to the vehicles. From June 2013 to March 2017, in exchange for bribes and kickbacks, Isaias allegedly provided favorable official action on the Forest Service’s behalf to Perez and JP’s Auto by steering Forest Service vehicle maintenance and repair work to them.
IV. Arkansas Man Detained Pending Trial on Federal Gun Charges
A Sherwood, Arkansas man will remain in custody to await trial after being indicted on federal firearm charges. Noah Shoemaker, 37, appeared for a bond hearing on Monday afternoon before United States Magistrate Judge Patricia S. Harris. Shoemaker was charged in January 2021 with one count of being a felon in possession of a firearm and one count of possessing a machine gun. When FBI agents arrested Shoemaker on January 30, they discovered he had fled to Pinnacle Mountain State Park.
Upon locating Shoemaker, agents found a firearm on his person and another firearm in his vehicle ,as well as numerous rounds of ammunition. Additionally, Shoemaker was equipped with camping gear, bottled water, cash, fire supplies, and other survival gear.
Judge Harris determined that Shoemaker poses posed a risk of flight as well as a risk of danger to the community and remanded him to the custody of the United States Marshals. He will remain in custody until his trial, which is currently scheduled for March 29, 2021, but is expected to be continued due to the Court’s Administrative Order 11. Shoemaker was initially charged in January on a federal complaint and subsequently indicted on three charges—two counts of being a felon in possession of a firearm and one count of possessing a machine gun—on Feb. 3, 2021.
If convicted of being a felon in possession of a firearm and possessing a machine gun, Shoemaker’s faces are both punishable by up to 10 years’ imprisonment, a fine of not more than $250,000, and up to three years of supervised release for each charge.
V. Houston-area Woman Charged with Fraudulently Receiving Millions Under CARES Act
A 37-year-old Houston resident is set to appear in federal court for her alleged submission of two Paycheck Protection Program (PPP) loan applications pursuant to the Coronavirus Aid, Relief and Economic Security (CARES) Act, announced Acting U.S. Attorney Jennifer B. Lowery. The criminal indictment, which was filed on Feb. 24, charges LaDonna Wiggins with bank fraud, making a false statement to a bank, and money laundering. She appeared before U.S. Magistrate Judge Peter Bray on March 2, 2021. If convicted, Wiggins faces up to 30 years in federal prison and a possible $1 million fine.
Wiggins allegedly submitted two PPP loan applications for businesses known as Wiggins & Graham Enterprise LLC and Pink Lady Line, resulting in the receipt of $3,648,145. The charges allege Wiggins used these funds to make personal purchases such as for two homes, multiple vehicles, and luxury goods – rather than for any legitimate business purposes.
The CARES Act is a federal law enacted March 27, 2020, to provide emergency financial assistance to the millions of Americans who are suffering the economic effects caused by the COVID-19 pandemic. One source of relief is the authorization of up to $349 billion in the United States Small Business Administration (SBA)-guaranteed and forgivable loans to small businesses through the PPP, but funds must be used for certain expenses, like payroll costs, interest on mortgages, rent, and utilities.
VI. Ten Indicted for Allegedly Trafficking More Than 500 Grams of Meth
In a superseding indictment, unsealed March 3, 2021, ten were charged with manufacturing and trafficking methamphetamine all through the Tulsa Metro area. The charge was announced by the Acting U.S. Attorney for the Northern District of Oklahoma Clint Johnson. During an early morning law enforcement operation targeting members of the drug trafficking organization, ten individuals were arrested, with eight of those arrested were named in the indictment.
The 16-count indictment alleges the defendants conspired to manufacture, to possess with intent to distribute and to distribute 500 grams or more of methamphetamine. The defendants have been charged with drug conspiracy, possession with intent to distribute and distribution of methamphetamine, maintaining a drug-involved premises, and use of a communication facility in committing, causing, and facilitating the commission of a drug trafficking felony.
VII. Businessman Indicted for Not Reporting Foreign Bank Accounts and Filing False Documents with IRS
A federal grand jury returned an indictment today charging a Herndon man with failing to file Reports of Foreign Bank and Financial Accounts (FBARs) and filing false documents with the IRS. According to the indictment, Azizur Rahman, 70, had a financial interest in and signature authority over more than 20 foreign financial accounts, including accounts held in Switzerland, the United Kingdom, the Republic of Singapore, and Bangladesh.
For the years 2010 through 2016, Rahman allegedly did not disclose his interest in all of his financial accounts on annual FBARs, as required by law. Rahman also allegedly filed false individual tax returns for the tax years 2010 through 2016 that did not report to the IRS all of his foreign bank accounts and income. Rahman is also charged with filing a false “Streamlined Submission” in conjunction with the IRS Streamlined Domestic Offshore Procedures.
Those procedures allowed eligible taxpayers residing within the United States, who failed to report gross income from foreign financial accounts on prior tax returns, failed to pay taxes on that gross income, or who failed to submit an FBAR disclosing foreign financial accounts, to voluntarily disclose their conduct to the IRS and to pay a reduced penalty if their conduct was non-willful. The indictment alleges that Rahman’s Streamlined Submission did not truthfully disclose all the foreign bank accounts in which he had an interest and falsely claimed that his failure to report all income, pay all tax, and submit all required information returns, such as FBARs, was non-willful.
If convicted, Rahman faces up to three years in prison for each of the counts related to filing false tax documents and up to five years in prison for each count relating to his failure to file an FBAR or filing a false FBAR.
VIII. Union Leader and Nephew Charged with Extortion, Conspiracy
On March 3, 2021, Acting U.S. Attorney for the Eastern District of Pennsylvania Jennifer Arbittier Williams announced that John Dougherty, 60, and Gregory Fiocca, 28, both of Philadelphia, PA, were charged by Indictment with 18 counts of extortion and one count of conspiracy to commit extortion. This Indictment represents new charges against Dougherty, separate and distinct from any other currently pending case.
The Indictment alleges that Dougherty, the Business Manager of International Brotherhood of Electrical Workers Local 98 (Local 98), and Fiocca, his nephew and a member of Local 98, conspired to extort salary, wages, and employee benefits from Fiocca’s employer, an electrical contracting company, for services Fiocca allegedly did not actually perform from August 2020 until January 2021. The object of the conspiracy was to have Fiocca’s employer continue to pay Fiocca without holding Fiocca accountable or monitoring his work performance.
The defendants allegedly used actual and threatened force, violence and fear, including fear of economic harm, to obtain this result. The Indictment further alleges that between October 2019 and August 2020, after Dougherty appointed Fiocca to be the Local 98 steward for employees working at this job site, Fiocca frequently did not show up for work, was not present at his workstation, and did not complete his assigned work.
As a result, Fiocca allegedly was sometimes paid for fewer than 40 hours per week. It is also alleged that Dougherty was apprised of Fiocca’s attendance and performance issues but refused to acknowledge that Fiocca was at fault.
IX. Four Charged in Scheme Employing Homeless to Cash Bogus Checks
Four men originally from the Atlanta area have been charged in federal court in Providence, Rhode Island, for allegedly operating a long-running scheme in which homeless and transient individuals from the Providence area were recruited to cash counterfeit business checks in exchange for a cash payment.
It is alleged in court documents that homeless individuals enlisted by the Georgia men were driven to financial institutions in Rhode Island, Massachusetts, Connecticut, Maine, and elsewhere, provided bogus business checks made out to them, and were instructed to cash the checks using their Rhode Island ID card or driver’s license for identification. The individuals were told to return to the vehicle with the cash and, in return, were paid between $100 and $200.
It is further alleged that in at least one instance, a homeless individual was threatened with bodily harm if that person took off with the proceeds after cashing the bogus check and failed to provide the funds to the schemers.
As a result of an investigation by the Medway, MA, Police Department and the Secret Service, federal criminal complaints filed in U.S. District Court in Providence charge Austin Weaver, 31, of Decatur, GA; Cortavious Benford, 26, of Atlanta, GA; and Michael Williams, 26, and Jalen Ronald Stanford, 28, of East Point, GA, with conspiracy to commit bank fraud. The charges were announced by the Acting U.S. Attorney for the District of Rhode Island, along with several law enforcement officials.
X. Oklahoma Mother Charged with Production of Child Pornography
A 29-year-old Claremore woman, Brittney Jo Wallace, was indicted in federal court on March 4, 2021, for producing child pornography involving her young child. The charge was announced by the Acting U.S. Attorney for the Northern District of Oklahoma Clint Johnson. Wallace was charged with the production of child pornography by a parent and with possession of child pornography. The Court ordered Wallace detained pending trial.
According to the indictment, Wallace knowingly permitted the young child to engage in sexually explicit activity while she took photos on her cell phone on Sept. 26, 2015. From Sept. 26, 2015, to May 13, 2016, Wallace also knowingly possessed with intent to view the child pornography. At a detention hearing on March 2, Assistant U.S. Attorney Matilda Villalobos argued the defendant was a danger to the community and should be detained based on her criminal record and evidence she abused her children in 2015 and 2016.
AUSA Villalobos stated evidence would show that in 2016, the defendant’s children were taken from the home after a doctor found signs of severe child abuse. Wallace’s parental rights were later terminated. The Court ruled in favor of the United States and ordered the defendant detained.