Examples of Narcotics-Related Investigations - Fiscal Year 2014
The following examples of narcotics-related investigations are written from public record documents on file in the courts within the judicial district where the cases were prosecuted.
Worldwide Drug Trafficker Sentenced
On Feb. 20, 2014, in Sacramento, Calif., Shiraz Malik, a Pakistani national residing in Warsaw, Poland, was sentenced to 180 months in prison. Malik was arrested at the Prague International Airport on Sept. 8, 2011, and was extradited on June 22, 2012, from the Czech Republic to the United States. He pleaded guilty on Oct. 7, 2013 to conspiring to distribute controlled substances and listed chemicals, conspiring to import controlled substances and ephedrine into the United States, and conspiring to launder money. According to court documents, from June 1, 2008, through Sept. 8, 2011, Malik sold pharmaceuticals and highly regulated chemicals to customers in the United States, Europe and other countries and conspired to launder the profits of that activity. Malik took orders from customers via the Internet and coordinated with people in Pakistan to fill the orders. In the course of the three-year investigation, law enforcement agents made eight undercover purchases of various drugs from Malik that were shipped from a post office in Lahore, Pakistan to addresses in the Sacramento area. In each instance, the purchase request was sent to Malik via email and payment instructions were sent by Malik to the undercover agent. Malik maintained at least two bank accounts in Poland that he used to receive payments for Internet drug purchases from undercover agents.
Former Michigan Liquor Store Owner Sentenced for Tax Fraud and Drug Charges
On Feb. 19, 2014, in Detroit, Mich., Bashar Saroki, of Southfield, Mich., was sentenced to 30 months in prison and one year of supervised release. Saroki pleaded guilty to filing a false 2009 tax return and offering drug paraphernalia for sale. According to court documents, Saroki controlled and operated Golden Star Party Store, a liquor store that was located in Detroit, Mich. From 2007 through 2011, Saroki sold more than $1 million worth of a variety of cutting agents to local narcotics dealers out of the liquor store and from his residence. Narcotics dealers used these cutting agents to dilute the potency and increase the quantity of the narcotics they sold to customers. Saroki also filed a false tax return for 2009 that reported very little income despite the significant proceeds from the sale of cutting agents.
Two Men Sentenced for Roles in Drug Trafficking Organization
On January 27, 2014, in Phoenix, Ariz., Jonathan Ortiz Troncoza was sentenced to 120 months in prison and five years of supervised release. David Ortiz Troncoza, Jr. was sentenced to 70 months in prison and five years of supervised release. Jonathan Troncoza pleaded guilty on August 6, 2012 to conspiracy to possess with intent to distribute cocaine and marijuana and conspiracy to commit money laundering. David Troncoza pleaded guilty on July 30, 2012 to conspiracy to possess with intent to distribute cocaine and marijuana and conspiracy to commit money laundering. According to court documents, beginning on or about March 29, 2005 and continuing through June 1, 2010, Jonathan Troncoza operated a marijuana and cocaine distribution organization. Jonathan and David Troncoza and others distributed large amounts of marijuana and cocaine and laundered the drug proceeds. Specifically, the drug organization receive marijuana and cocaine from sources in the Republic of Mexico. The defendants used stash houses and warehouses to store the drugs for further distribution. A portion of the proceeds were used to acquire additional quantities of drugs for sale, pay for the expenses of the stash houses, cars, couriers, communication equipment and other needs of the drug organization. In addition, business entities were used in furtherance of the conspiracy in order to conceal the identities of the defendants and the true nature of the drug trafficking organization.
Five Men Sentenced for Prescription Drug Trafficking
On January 24, 2014, in Sherman, Texas, Khuda Balouch Buksh, of Duncanville, Texas; Sikander Ali Teepu, of Wantagh, N.Y.; and Haroon Ahmad Tanooli, of Sugarland, Texas, were sentenced to 36 months, 18 months and 18 months in prison, respectively. On January 22, 2014, Mustajab Ali Raza, of Brighton, Minn., and Saaim Aslam, of Irvine, Calif., were both sentenced to 12 months and one day in prison. Buksh and Raza were ordered to be deported following the completion of their prison sentences. According to information presented in court, beginning in 2009, the defendants conspired to import and distribute controlled substances to others by way of a large on-line pharmaceutical operation. The defendants conspired to import and distribute drugs that were unlawfully imported from China, Singapore, Hong Kong, Pakistan, and elsewhere by use of the United States Postal Service and other foreign and domestic common carriers. The drugs consisted primarily of misbranded, adulterated, and counterfeit pills made to look like, and sold to customers as if they were, FDA-approved substances manufactured and approved for use within the United States.
Pill Mill Doctor Sentenced for Drug Conspiracy and Money Laundering
On January 7, 2014, in Miami Fla., Dr. Scott Becker, of Pembroke Pines, Fla., was sentenced to 70 months in prison and three years of supervised release. Becker previously pleaded guilty to conspiring to distribute and dispense large amounts of oxycodone without a legitimate medical purpose and outside the usual course of professional practice and money laundering. Becker also agreed to forfeit $470,400 in money and property representing the illegal narcotics proceeds he earned as a result of his involvement as a physician at All Pain Management in Dania Beach. According to court documents, between February 16 and September 17, 2010, Becker was employed as a clinic doctor at All Pain Management which, at the time, was owned by co-conspirators Vincent Colangelo and several other individuals. Colangelo pleaded guilty to narcotics, money laundering and federal income tax offenses on April 2, 2012. According to a review of medical records, while at All Pain Management, Becker prescribed 932,259 oxycodone, 30 milligram pills during the course of 4,821 patient visits and more than 98% of Becker’s patients received prescriptions for oxycodone. Becker also laundered approximately $24,142 in illegal narcotics proceeds.
National Drug Trafficking and Money Laundering Organization Based in Georgia Dismantled
On December 19, 2013, in Atlanta, Ga., Jiles Delwin Johnson, of Sandy Springs, Ga., was sentenced to 180 months in prison and five years of supervised release. On the same date, Johnson’s wife, Shannon Renee Johnson, was sentenced to 36 months in prison and three years of supervised release. Jiles Johnson previously pleaded guilty to conspiracy to possess and distribute cocaine and money laundering. Shannon Johnson previously pleaded guilty to money laundering conspiracy. According to court documents, the Johnsons participated in a large-scale drug trafficking and money laundering organization that distributed thousands of kilograms of cocaine nationwide and laundered millions of dollars in drug proceeds in Georgia. The organization coordinated its efforts through the KC Pit BBQ Restaurant in Sandy Springs, which had been owned by the Johnsons. Jiles Johnson was also a commercial truck driver. To supplement his income, he began transporting drugs from California to Philadelphia. As Johnson generated cash from cocaine sales, he purchased real estate. The Johnsons invested over three million dollars in real estate holdings. When the cash volume increased, Jacques Degaule, a financial planner, assisted with the laundering. Degaule traveled to banks in other states where he deposited over $7 million. No IRS Forms 8300 were filed, which are required when a trade or business receives cash over $10,000. The Johnsons used these laundered funds to underwrite their investments and their restaurant’s operations. On September 4, 2013, Degaule was sentenced to 36 months in prison and one year of supervised release.
Texan Sentenced for Drug Trafficking and Money Laundering
On December 19, 2013, in Houston, Texas, Huey Joseph Hebert III, formerly of Dickinson, Texas, was sentenced to 360 months in prison and five years of supervised release for his role in a drug trafficking organization. Hebert was also ordered to forfeit two Harris County properties and pay a $2,000 fine. Hebert pleaded guilty on May 9, 2013. At the time of the plea, Hebert admitted he conspired with 14 other individuals to distribute illegal drugs from Dickinson to Louisiana and elsewhere from mid-2008 until February 2012. According to court documents, Hebert purchased cashier checks to purchase real property using funds derived from unlawful activity.
Texas Drug Dealer Sentenced on Drug and Money Laundering Charges
On December 11, 2013, in Brownsville, Texas, Julio Cesar Cardenas received four life sentences in prison for conspiracy to possess with intent to distribute illegal drugs and money laundering. He was also ordered to pay $1,700 in restitution. Cardenas was convicted by jury on May 31, 2013. According to the evidence and testimony presented in court, around January 2010 and continuing until about September 17, 2012, Cardenas led a drug trafficking organization. The organization distributed cocaine and marijuana through commercial freight lines to numerous states. After the marijuana and cocaine was sold in these states, Cardenas directed the illegal money remitting of the transportation costs and drug proceeds of the narcotics back to the Brownsville area by utilizing cash deposits in bank accounts in the names of other individuals and co-conspirators. Branch banks were utilized in the receiving states with the money to be withdrawn by the co-conspirators in Brownsville on a regular basis. Testimony at trial demonstrated that Cardenas engaged in numerous drug trafficking and illegal money remitting conversations in March, April and June 2011.
Wisconsin Man Sentenced for Role in Drug Trafficking Operation
On December 10, 2013, in Milwaukee, Wis., Randy Martinez, aka Robin Lee Martinez, of Sheboygan, was sentenced to 124 months in prison. Martinez pleaded guilty to his role in the Balderas Organization drug trafficking activities. According to court documents, beginning in the mid-1990's, the Balderas Drug Organization transported cocaine and marijuana from Texas to Wisconsin. Instrumental in the Balderas Organization’s ability to sell drugs in Wisconsin was Martinez’s role as leader of the organization in Wisconsin. The Balderas Organization was involved in conspiring to transport over 5 kilograms of cocaine and over 1,000 kilograms of marijuana to Wisconsin. Martinez shielded some of the members of the Balderas Organization from being linked to the organization; he controlled the Wisconsin distribution of narcotics and played an integral part in the money laundering of funds for the Balderas Organization. When a load was brought from Texas to Wisconsin, Martinez would cut up the narcotics and distribute it to customers for the Balderas Organization. In addition, Martinez was involved in recruiting individuals to receive packages mailed from Texas to Wisconsin and for the distribution. He was also in charge of deposits made into various bank accounts controlled by the Balderas Organization from Wisconsin to Texas. Martinez would direct individuals to send payment via wire transfer, bulk cash smuggling, and on their person to various individuals and accounts in Texas so as to help the Balderas Organization receive its profits. Bank records support that through a complex bank account scheme, the Balderas Organization was able to launder, at least $300,000 and up to $500,000.
Arizona Man Sentenced on Drug and Money Laundering Charges
On December 9, 2013, in Phoenix, Ariz., Oscar Fernando Ortiz, Jr., was sentenced to 120 months in prison and five years of supervised release. Ortiz pleaded guilty on September 20, 2013 to conspiracy to possess with intent to distribute marijuana and conspiracy to launder monetary instruments. According to court documents, between November 11, 2009 and July 5, 2011, Ortiz agreed to work with several other people in an organization that received relatively large quantities of marijuana, broke it down into smaller quantities that could be repackaged in postal boxes and shipped it to customers in cities in other parts of the United States. In addition, between November 11, 2009 and February 21, 2012, Ortiz used drug proceeds to purchase assets, such as cars, and have the registration placed in his name in order to conceal the nature, source, control and ownership of the drug proceeds.
Major New York Drug Trafficker Sentenced on Drug and Money Laundering Charges
On December 3, 2013, in Rochester, N.Y., Ronald Walker, of Corona, N.Y., was sentenced to 120 months in prison for conspiracy to distribute and possession with intent to distribute illegal narcotics and conspiracy to commit money laundering. Walker was also ordered to forfeit assets totaling $2,500,000, which represented the amount of proceeds from the drug trafficking conspiracy. According to court records, between 2005 and August 2012, Walker was in New York City and arranged for the distribution of cocaine and heroin through others to individuals who were transporting the drugs to Rochester. In addition, Walker laundered drug proceeds by placing at least $911,000 in cash in safe deposit boxes opened by other individuals to conceal the proceeds. In August 2012, authorities seized the cash from these safe deposit boxes, as well as approximately $615,000 in cash from two residences connected to the defendant. Walker agreed to forfeit all of that cash, as well as a 2012 Range Rover vehicle, jewelry and two properties, as proceeds of his illegal activities.
Texas Men Sentenced for Various Roles in Hydroponic Marijuana Growing Operation
On December 2, 2013, in Dallas, Texas, Louis Michael Olerio Jr., of Dallas, was sentenced to 24 months in prison. Olerio pleaded guilty in October 2012 to conspiracy to commit money laundering, stemming from his role in a hydroponic marijuana growing operation. Five other defendants have been sentenced in this investigation. Brian Edward Deloney was sentenced to 18 months in prison, Jeremy Cash McElroy was sentenced 36 months in prison, Eric Irving Love received 30 months in prison, Jeffrey Scott Gannon was sentenced to 27 months in prison, and Stephen Ray Willeford Jr. was sentenced to 24 months in prison. According to documents filed in the case, between 2004 and June 2010, McElroy, Olerio, Gannon and Love conspired to maintain 11 houses, in Dallas and Richardson, Texas, to cultivate and distribute highly potent hydroponic marijuana. Almost all of the marijuana grown at these houses by the defendants was ultimately delivered to Deloney for distribution. McElroy decided to distance himself from the day-to-day operations of the conspiracy and agreed to sell two of the marijuana grow houses to Olerio, while retaining a percentage of the proceeds in the sale of marijuana grown in those houses. To that end, McElroy transferred the deed for one of the houses to Olerio and sold another one of the grow houses to Olerio. Olerio agreed to continue the operation in these houses and pay McElroy 20 percent of the profits from the sale of the marijuana. McElroy and Olerio conducted financial transactions with the intent to conceal any ownership McElroy had in the profits from the marijuana sales.
Father, Two Sons Sentenced for Oxycodone and Money Laundering Conspiracies
On November 20, 2013, in Knoxville, Tenn., Jackie Mize and his two sons, Kelvin and James Mize, were sentenced for conspiracy to distribute oxycodone and money laundering. Jackie and Kelvin each received 360 months, James received 300 months and all were ordered forfeiture of $3 million. According to court documents, Jackie Mize, his two sons and others made regular “doctor shopping” trips to Florida over an 18-month period to get prescriptions for oxycodone and other controlled substances, had the prescriptions filled at pharmacies there, and used and sold the pills in and around Claiborne County, Tenn. Over 75,000 oxycodone tablets and more than 25,000 doses of Xanax were part of the scheme.
Pennsylvania Drug Dealer Sentenced
On November 5, 2013, in Philadelphia, Pa., Jaquel Crews was sentenced to 240 months in prison and ten years of supervised release. On March 14, 2012, Crews was convicted for drug conspiracy and ten counts of money laundering. According to court documents, Crews, along with others, participated in a conspiracy to distribute hundreds of kilograms of cocaine and hundreds of grams of cocaine base from 1986 to November 2007, in Philadelphia. The conspirators laundered hundreds of thousands of dollars in drug proceeds by spending lavishly on personal items and through the purchase and refinance of numerous homes.
Member of Drug and Money Laundering Conspiracy Sentenced
On October 25, 2013, in Boston, Mass., Brant Welty, of South Boston, was sentenced to 100 months in prison and ordered to pay a criminal forfeiture money judgment of $85,500. In March 2013, Welty pleaded guilty to conspiracy to distribute oxycodone and money laundering conspiracy. According to court documents, Welty, along with 12 others, was first charged in 2011 for a conspiracy which spanned Massachusetts, Florida, New York, Rhode Island, South Carolina and elsewhere. The conspirators trafficked hundreds of thousands of oxycodone pills and generated over $4 million in proceeds. The investigation has resulted in the seizure of over $480,000 in cash, a 38-foot speed boat, numerous luxury vehicles, 13 firearms and approximately 12,000 oxycodone pills. Investigators also uncovered extensive evidence of illegal gambling and prostitution, as well as the use of extortionate threats to collect loans to gamblers and others.
Former Hip-Hop Manager, Leader of Drug Trafficking Organization Sentenced to Life in Prison
On October 25, 2013, in Brooklyn, N.Y., James Rosemond, aka Jimmy Henchman, was sentenced to mandatory life in prison and ordered to forfeit $10 million, along with property worth approximately $4 million. Rosemond was sentenced for leading a continuing criminal enterprise (the “Rosemond Organization”) that distributed thousands of pounds of cocaine, numerous narcotics conspiracy offenses, firearms possession, money laundering, structuring and obstruction of justice. In May 2012, following a three-week jury trial, Rosemond was convicted of all thirteen counts in his indictment. According to court documents, Rosemond was the leader of a large-scale, bi-coastal narcotics-trafficking organization that shipped cocaine from Los Angeles, Calif., to the New York City metropolitan area and that, in turn, shipped cash proceeds from narcotics sales back to Los Angeles. During the investigation, federal law enforcement agents made multiple seizures of drugs, money, firearms and tools of the narcotics distribution trade belonging to the Rosemond Organization. In total, between 2008 and 2010, law enforcement seized over $2.8 million of the Rosemond Organization’s drug proceeds.
Pennsylvania Man Sentenced in Drug Conspiracy Case
On October 22, 2013, in Wilmington, Del., Kevin Morris, of Franklin Township, Pa., was sentenced to 57 months in prison, three years of supervised release and ordered to forfeit $22,172 in drug proceeds. Morris pleaded guilty on July 25, 2012, to conspiracy to smuggle five kilograms of cocaine and one kilogram of heroin from the Republic of Panama into the United States and money laundering. According to facts introduced during the plea hearing, Morris acted as a recruiter, facilitator, and financier for an organization and was involved on multiple occasions in which couriers smuggled or attempted to smuggle heroin and cocaine from Panama to Delaware. He made cocaine and heroin sales to customers based primarily in Pennsylvania, including to confidential informants under the control of the Pennsylvania State Police. Morris further admitted his involvement in purchasing approximately one-half kilogram of cocaine in Washington, D.C., which had been smuggled into the United States through a military contractor based in Afghanistan. In connection with his plea agreement, Morris laundered his drug proceeds in part by purchasing two vehicles.
Texan Sentenced for Role in a Drug Trafficking Organization
On October 22, 2013, in Fort Worth, Texas, Carl Gayheart Schou was sentenced to 28 months in prison and two years of supervised release. Schou pleaded guilty in November 2012 to conspiracy to possess with intent to distribute a controlled substance and one count of conspiracy to launder monetary instruments. According to court documents, from December 2009 until March 2012, Schou and other defendants were involved in the sale and shipment of marijuana from the Dallas Fort-Worth (DFW) area to buyers located in St Croix, in the U.S. Virgin Islands. Schou and others would mail parcels of marijuana, each weighing approximately two – five kilograms, from multiple post offices in DFW to buyers in St. Croix. Fictitious return addresses were used on the drug parcels to avoid detection. In return for the drug parcels, the buyers would mail the defendants parcels containing proceeds of the sales of the trafficked marijuana, most commonly in the form of U.S. Postal money orders. At times, in order to disguise the source of the proceeds of the marijuana trafficking, they would use false information in the return addresses and would mail the proceeds to third parties. They would then deposit the money orders into their personal bank accounts, or cash them at their member bank, a check cashing facility or a U.S. Postal facility.
Arizona Man Sentenced on Drug and Money Laundering Charges
On October 21, 2013, in Phoenix, Ariz., Robert Gene White was sentenced to 72 months in prison and five years of supervised release. White was convicted in April 2013 on charges of conspiracy to possess with intent to distribute more than 1,000 kilograms of marijuana and less than 500 grams of cocaine, conspiracy to commit money laundering and three counts of transactional money laundering. According to evidence presented at trial, a drug trafficking organization (DTO) received drugs from Mexico via “backpackers,” repackaged the marijuana into parcels, then shipped it through United Parcel Service (UPS). White, a UPS driver, knowingly received packages from the DTO and delivered them into the UPS mail-stream for delivery to customers in New York, Ohio and Virginia. In return, the DTO received parcels of money ranging from $20,000 to $30,000 from the buyers. To conceal who the money was being sent to, the DTO had buyers address returning money parcels to real addresses on White’s delivery route but with fictitious business names and suite numbers that did not exist. White then redirected them to the DTO. White shipped 200 to 300 pounds of marijuana each week for over a year, receiving as much as $50 for each pound of marijuana that went through his truck.
Florida Man Who Illegally Mailed Oxycodone Pills Sentenced to Prison
On October 17, 2013, in Beckley, W.Va., Ryan D. Moore, of Hillsborough County, Fla., was sentenced to 168 months in prison. Moore pleaded guilty in May 2013 to conspiracy to distribute oxycodone and conspiracy to commit money laundering. From at least October 15, 2010 until April 27, 2012, Moore mailed packages containing approximately 17,000 30-milligram oxycodone tablets to individuals located in West Virginia. Moore received at least $330,000 in cash as payment for the packages that contained oxycodone tablets. The cash was deposited into Moore’s bank accounts during the scheme. Moore knew that the cash payments deposited into his bank account were proceeds collected from illegal pill transactions. Moore mailed packages containing oxycodone pills to two Wyoming County residents, Christopher and Jennifer Brooks, from at least March 2010 until April 27, 2012. Christopher and Jennifer Brooks both of Glen Fork, W.Va., previously pleaded guilty in February to conspiracy to distribute oxycodone and money laundering charges. In August 2013, Christopher Brooks was sentenced to 10 years in prison and Jennifer Brooks was sentenced to seven years in prison for her role in the scheme. Moore also mailed packages containing oxycodone to Keith Keiffer. Keiffer, of Calvin, Nicholas County, W.Va., received at least 15 express mail packages that contained a total of approximately 1,400 30-milligram oxycodone tablets from Moore. Keiffer, in exchange for the oxycodone tablets, deposited thousands of dollars’ cash into Moore’s bank accounts. Keiffer was sentenced to four years in prison in July 2013.
New York Man Sentenced for Conspiracy to Import and Distribute Synthetic Drug
On October 11, 2013, in Syracuse, N.Y., Rosario Gambuzza, of East Syracuse, N.Y., was sentenced to 188 months in prison and three years of supervised release. In May 2013, Gambuzza was convicted after a jury trial on charges of a drug conspiracy and money laundering. According to court documents, between January 2010 and April 2011, Gambuzza conspired to import and distribute a controlled substance analogue, known on the street as “Molly” in Syracuse, N.Y. Gambuzza was also convicted of 19 counts of money laundering relating to $73,000 he wired to a co-conspirator in Shanghai, China, in order to purchase the drug.