Federal Crimes

South Floridian Residents Charged in Phishing Scams

March 21, 2016 | Michael B. Cohen, P.A.

Recently on my Website, I’ve been focusing on the topic of identity theft since tax season is fast approaching and the rise in these types of cases increases dramatically this time of year.

Most people submit their tax information to the IRS before the April 15 deadline hoping to receive their refund checks as early as possible.

But in many cases, others are already spending that expected money as people continually check their mailboxes for the check they assume to receive from the Department of the Treasury.

South Florida Couple Uses Creative Method to Steal Identities

February 10, 2016 | Michael B. Cohen, P.A.

Tax Season has begun, and potential identity thieves are making plans.

After the New Year’s festivities end, up until the April 15 deadline (excluding extensions) people go through their records from the previous year and prepare to submit their completed income tax information to the IRS by themselves or through a representative, in the hopes of receiving a nice refund from the taxes they overpaid during the year; using the deductions they are legally entitled to.

But well before that date, plans are hatched by identity thieves imagining how to play the system by stealing people’s identities, and cashing the refunds that are due to others.

Five Broward County Residents Settle Insider Trading Charges with SEC

December 19, 2015 | Michael B. Cohen, P.A.

In early November, 2011, an unnamed board member of Pharmasset Inc., a New Jersey based pharmaceutical company that developed a drug named sofosbuvir, (brand name Sovaldi) which had promising results in the treatment of hepatitis C met with members of the company’s Boca Raton based legal team and longtime advisors Robert Spallina and Donald Teascher.

Steven Rosen, CPA, a director in a Plantation based accounting firm was also present at the meeting. At the time, Pharmasset didn’t have any major drugs on the market.

The unnamed board member owned a substantial amount of his company’s stock and was discussing financial and legal advice with the lawyers and accountant regarding what he may realize monetarily from a pending buyout transaction if the company was sold. Rumors of the sale of the company had been abounding recently causing the stock price to slowly move on a slightly upward bias. During the extent of their conversation he told the three men that Pharmasset was in the advanced stages of a negotiation to sell the company.
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South Florida Woman Pleads Guilty to Importing Synthetic Drug

October 5, 2015 | Michael B. Cohen, P.A.

Although she may not be the mastermind of the operation, twenty-two year old Jaime Nicole Lewis, of Boca Raton has been charged with conspiring to import, possess and distribute several kilos of Alpha-Pyrrolidinopentiophenon (Alpha-PVP), the main ingredient of an illegal synthetic drug manufactured in China. In street jargon, the drug is commonly known as flakka.

Early last week, Lewis pleaded guilty to conspiring to having the key flakka ingredient imported into the country although she maintains that her role was only acting as a type of accountant responsible for taking care of the “money aspect” for the illegal operation she was charged with being a part of.

She’s been held in federal custody since late April when U.S. Magistrate Judge Dave Brannon said that Lewis posed a danger to the community. She was previously arrested multiple times for possession of marijuana; the last arrest a more serious charge of possession with intent to distribute to a minor in a case which is still ongoing in Broward County.

The judge stated that “the major problem I have with the situation is the repeated encounters Ms. Lewis has had with the court system, which apparently don’t teach her anything.”

Broward County Resident Accepts 70 Month Prison Sentence for Identity Theft

March 30, 2015 | Michael B. Cohen, P.A.

With less than a week to go, many are looking forward to opening of the 2015 baseball season. And only ten days after that event begins the deadline for filing your tax return reaches its deadline. Spring always brings about the beginning of one and cutoff date of the other season.

And just as the first pitch is being thrown in all major baseball stadiums across the country, cases of tax fraud and identity theft will be highlighted in the headlines.

Many of us use tax preparers to fill out and submit our returns with a belief that these professionals are doing so to our benefit, more qualified to take the information we give them and bring us back the highest monetary return or lowest tax liability possible.

In Broward County, Julio Lugo was the proprietor of multiple agencies of this type, including #1 Tax Specialist LLC, the Number One Tax Specialist LLC, and Number Two Tax Specialist Inc., all based in Miramar. He also had control over Light House Refund of Miami from which he obtained an EFIN (Electronic Filing Identification Number) from the Internal Revenue Service which allowed him to electronically file customer’s income tax returns, supposedly on their behalf.

Lugo and his associate Jamar James who registered Light House Refund both faced charges relating to improperly filing returns on their customer’s behalf for their own personal gain. Lugo was also listed as the registrant of Facerick Entertainment LLC, Chairman/CEO of Top Line Music Group, LLC and the Managing Member of Auto by Vision, LLC.

But for all his business interests, Lugo was apprehended by federal law enforcement for a scheme that found that he was using the EFIN acquired by Light House Refund to file close to fifty false tax returns using stolen identities. According to the Indictment he was paid several hundreds of thousands of dollars for the fraudulent tax refunds provided by the IRS during the timeframe of Oct. 2010 through Sept. 2012.

In a deal with the government, Lugo pleaded guilty to one count of conspiracy to defraud in relation to aggravated identity theft. He accepted a sentence of close to six years in a federal prison and more than a quarter million dollars in restitution. Upon his release, Lugo will complete his sentence with three years of probation.

His codefendant Jamar James received a sentence of two years of probation for his role in the scheme. His probationary sentence was for accepting a guilty plea for one count of making a false statement to a federal agency.

The press release for the case was announced by Wifredo A. Ferrer, the United States Attorney for the Southern District of Florida, along with Kelly R. Jackson, the Special Agent in Charge for IRS Criminal Investigations (IRS-CI).
George L. Piro, Special Agent in Charge for the FBI’s Miami Field Office was also named in the press release.

Eight Arrested in Offshore Gambling Ring with Connection to Organized Crime

February 16, 2015 | Michael B. Cohen, P.A.

After an investigation that went on for over half a year, eight South Florida men were taken into custody as the result of a sting that covered territory along the East Coast in an offshore online sports gambling ring that was operated out of the suspect’s homes as well as local businesses. The online bookmaking ring took bets on professional and college sports including football, baseball, and basketball.

Related suspects were also arrested in New York City, Upstate New York’s Rockland County as well as Bergen County, New Jersey, with a grand total of over $4 million seized by federal agents between all locations. More than sixty search warrants were executed by multi-state agencies made up of the Organized crime unit in Florida as well as the FBI’s criminal division in the New York Metropolitan area and the Rockland County District Attorney’s Organized Crime Unit with assistance from the New York State Police Special Investigative Unit, Queens District Attorney’s Organized Crime Division, the NYPD Asset Forfeiture Unit, the Clarkstown and Ramapo police, the Bergen County, New Jersey Prosecutor’s Office, and the Department of Homeland Security.

In New York, the biggest catch found in the net was Daniel Pagano, now 61, the son of former Genovese crime family boss Joseph Luco Pagano. The younger Pagano is alleged to be a Captain in the continuing criminal enterprise.

Also picked up in the operation and accused of being linked to the infamous crime family was Pasquale Capolongo who was taken into custody in West Palm Beach, Florida. Capolongo had moved from White Plains, NY to West Palm Beach. He has a history of convictions for illegal gambling charges during the time he lived in Rockland County which has apparently followed him to South Florida.

The South Florida portion of the booty amounted to over $1.2 million and was snatched from the suspect’s homes, safety deposit boxes and personal bank accounts. According to papers released by the Broward County Sheriff’s Office, in this new age of digital crime; in addition to conducting their illicit business from their homes it is also alleged that they worked out of local casinos and a dog track, an Italian market in Coral Springs, a scrap metal business in Pompano, and even a Whole Foods market and CVS Pharmacy.

Arrests were initiated last year in Rockland County in early December with the conclusion of their own separate investigation which separately went on for over a year. At the time, District Attorney Thomas Zugibe said that they were “taking in millions of dollars a month” and continued by saying that “the investigation uncovered evidence that the enterprise had links to organized crime.”

In the South Florida connection all the men are charged with racketeering, conspiracy to commit racketeering, money laundering, conspiracy to commit money laundering, varying counts of bookmaking, conspiracy to commit bookmaking, and the unlawful use of two-way communication devices to facilitate a felony. All have been saddled with bond in excess of one hundred thousand dollars with Capolongo’s topping off at $1 million. Coming in second in the high-bond lottery was Michael Dangelo of Pompano Beach who had additional charges of drug trafficking and possession of cocaine and oxycodone which raised the amount of his bond to $777,000.

The Broward Sherriff’s Office said that the operation was foiled by texts and phone wiretaps, surveillance, along with cooperating witnesses and defendants as well as videotaped recordings of live transactions, and the hard work of their undercover deputies.

Sheriff’s spokesperson Gina Carter mentioned that “this is an ongoing investigation and we anticipate several more key players will be arrested in coming weeks.”

Four of the men who were arrested in Palm Beach County including Capolongo had hearings before a Broward Circuit Court Judge to account for the sources of their bond funds which must have been obtained from legitimate sources. The other three men were Devon Alexander Shalmi, 30, Joseph Petrolino, 47, and Thomas Cuce, 32. But for now the four remain in custody. All the men arrested live in the immediate neighborhoods of West Palm Beach, Boca Raton, Parkland, Margate and Coral Springs in Broward and Palm Beach Counties. The others arrested were Allan Klein, and his son Darren, Michael Dangelo, and Erik Bishop.

Broward County Sheriff Scott Israel commented on the workings of the criminal enterprise by saying “Criminal networks like these may not seem dangerous to the public… but it is activity such as this that leads to violence and fuels organized crime throughout the country.”

South Florida Ex-Convict Faces Federal Weapons Charges

January 24, 2015 | Michael B. Cohen, P.A.

Michael Paul Watkins of Inverness had successfully escaped from custody previously on two separate occasions after being convicted for the crime of fondling and handling a minor under the age of sixteen years in Florida State Court. He was arrested in October 2011 on a charge of domestic battery. Details of that arrest record are exempt from public information as per Florida statute.

Late last year, the Citrus County Sheriff’s Office received information from local Wal-Mart employees that an individual who was later identified as an employee of Cool Aid Heating and Air Conditioning was purchasing a questionably large amount of firearms from the outlet during the course of a short period of time. The air conditioning company was one of two businesses owned by Watkins. The purchases included various types of guns including AR-15 rifles. The law enforcement agency also received an anonymous tip that Watkins was obtaining and stockpiling firearms, grenades (explosive devices), and ammunition from a third party. As a convicted felon, Watkins is prohibited from manufacturing, possessing, or purchasing any type of weapons under the National Firearms Act.

The Sheriff’s Office contacted the Bureau of Alcohol, Tobacco and Firearms (ATF), a federal law enforcement agency and together they executed three warrants based on probable cause, searching Watkins home and the two businesses he owned.

Through their search efforts at Watkins home, close to 150 firearms as well as 17 explosive devices were uncovered. The investigators’ assigned to the search the premises commented that Watkins house was “built like a bunker”. There was a concrete gated wall surrounding the home entrance as well as rolling steel shutters guarding the front door and all windows.

In addition to the air conditioning and heating company, Watkins is also the owner of Ridin’ Dirty Motor Sports, a retailer of ATV’s, go carts and motorcycles. He was arrested at that location and charged with illegal possession of a firearm by a convicted felon as well as illegal possession of a destructive device. If convicted, each of the crimes carries a maximum sentence of 10 years in a federal prison.

When Watkins’ employee was questioned by federal investigators he told them that the acquisition of the firearms began in September 2013 in gun shops where they were legally sold, including Wal-Mart stores in Inverness, Inglis, and Ocala, Florida. The money was provided by his employer and on some occasions he waited in the store’s parking lot for the transaction to be completed. He also bought conversion kits for Watson by way of the Internet, using a pre-paid card provided by his boss. These supplies are specifically used in the conversion of semi-automatic weapons into automatic firearms.

He also admitted to investigators that he assisted his boss construct and set off pipe bombs which were made from PVC pipes that contained explosive substances on a vacant lot which Watkins owned in Dunnellon, FL. The Citrus County Property Appraiser confirmed that the property was owned by Watkins’s company (Watkins Inc.).

In further response to investigator’s questions regarding why his employer had accumulated the equivalence of a small armory, he told them that Watkins feared the foreseeable collapse of the United States economy and planned to eventually become a supplier for the firearms industry. Telephone records and text messages corresponding to the purchase dates between Watkins and his worker were also accumulated by investigating agents.

Although Watkins was convicted of his prior crimes in the state criminal justice system, these new charges will be tried in federal court. The employee continues to work and cooperate with federal authorities.

South Florida Corrections Officer Sentenced for Federal Charges

October 3, 2014 | Michael B. Cohen, P.A.

Former Corrections Officer Jerry St. Fleur, 26, was sentenced to over four years in a federal prison after agreeing to a plea deal for charges of identity theft and wire fraud. Over sixty thousand dollars that was proceeds from his scheme will also be forfeited. He faced up to twenty years in federal prison before submitting to the guilty plea.

But in 2014, St. Fleur was not alone when it came to officers from Florida’s Department of Corrections being arrested, accepting guilty pleas and being sentenced for their crimes.

St. Fleur was the third employee of Florida Correctional Institutions to be sent to federal prison for their transgressions. Just one month earlier, former juvenile probation officer Corey A. Coley was sentenced to more than seven years for identity theft and filing false tax returns and just two months prior to that resolution, former federal corrections Officer Michael J. Garland was sentenced to two years after he pleaded guilty for charges of bribery and smuggling contraband into a federal prison.

In this latest case St. Fleur’s guilty plea was established based on charges that he stole the identities of existing and former inmates who either served or were serving time at the Zephyrhills Correctional Facility. He used the data to file more than one hundred eighty bogus tax returns requesting refunds in an amount that exceeded one half million dollars

St. Fleur was arrested this past May on five separate counts of wire fraud and aggravated identity theft by using his authority to acquire birth dates and Social Security numbers that he matched up to the names of inmates currently serving their sentences at the facility. He was also charged with using the FDOC database to acquire the same information for inmates who previously were incarcerated there. He would use the former and present inmate’s personal identifying information (PII) to file the phony returns

After filing the fraudulent tax returns he directed payment to be deposited to debit cards that was held by accomplices who took part in his scheme.

The charges against St. Fleur of identity theft and wire fraud are both federal crimes which were investigated by the FBI and IRS. Locally, the investigation was assisted by the Hillsborough County Sheriff’s Office leading to St. Fleur’s arrest and subsequent guilty plea and sentence. It was prosecuted by Matthew Jackson, Assistant United States Attorney for the Middle District of Florida.

The Coley case resulted with him receiving a sentence of more than seven years in federal prison for wire fraud and aggravated identity theft, as well as conspiracy. He was also ordered to return $671,023. That amount was the minimum monetary quantity calculated to be what he and his three accomplices obtained through the scheme. His co-conspirators also received significant punishments.

Albert E. Moore, Jr. was sentenced to more than six years, Tigi Moore received a four year sentence and Mattie Philon received the shortest sentence of two years in federal prison.

The case against Garland concluded with a two year prison sentence and the forfeiture of $4,200 which was the amount traced as being the financial proceeds of his crimes.

Broward County Detectives Implicated in the Rothstein Case Surrender

April 29, 2014 | Michael B. Cohen, P.A.

A five year investigation bore fruit when former police lieutenant David Benjamin and former Detective Jeff Poole of the Broward County Sheriff’s Department surrendered at the Fort Lauderdale federal courthouse. Both detectives faced criminal conspiracy charges for abuse of power in their capacity as representatives of law enforcement. Both defendants were previously released on $250,000 bond.

The investigation tied the two deputies with a close affiliation with convicted Ponzi swindler Scott Rothstein. The allegations indicated that both of the men accepted cash payments and merchandise for help given to Rothstein before his massive Ponzi scheme was uncovered and ultimately collapsed. Rothstein has been serving a fifty year prison sentence after surrendering to federal authorities for his crimes and conviction of five federal offenses in January, 2010.

According to prosecutors, Benjamin received close to $200,000 in cash payments as well as assorted gifts and other benefits including sporting event tickets, free meals, and assorted jewelry in exchange for aiding and protecting the convicted felon by use of his authority in law enforcement. He is further accused of sending Poole, his “then” friend, subordinate and apparent lackey to fulfill the requests that Rothstein asked of him, according to court documentation.

Benjamin was the senior supervisor at the Broward County Sheriff’s Office, as well as being the head of Internal Affairs investigations and one of former Sheriff Al Lamberti’s top aides at the time the activities allegedly took place. Poole worked in the strategic investigations division as a detective. Benjamin, 48, lives in Boca Raton, and Poole, 47, is a resident of Weston.

The two detectives worked with each other in law enforcement since the late 1980’s, beginning their careers at the Pompano Beach police department under the command of Lamberti. They moved onto the Broward Sheriff’s Office when it was integrated into that division. Directly after prosecutors filed charges, Broward Sheriff Scott Israel fired the two within hours of the announcement. Israel replaced Lamberti after defeating the incumbent Sheriff in the previous year’s November election.

After letting the two deputies go, Israel was quoted as saying “The allegations as you know were very serious; the implications were grave… I could not allow these deputies to continue serving, interacting with Broward Sheriff’s deputies and the citizenry, until this case came to fruition.”

Some of the allegations laid out in the Information and other court documents are as follows:

Chiefly, Benjamin is accused of helping Rothstein when the scammer originally faced prosecution when his illegal activities were coming under intense scrutiny. He assisted him by providing protection when Rothstein grew apprehensive of airport security, according to IRS and FBI agents. Departing from Fort Lauderdale Executive Airport, Benjamin went as far as to personally assist Rothstein in filling a private jet with a half million dollars in cash as well as millions of dollars’ worth of valuables when Rothstein fled to Morocco, a country with no extradition treaty with the U.S.

Benjamin also allegedly organized “force and threats of force” subsequent to his law enforcement authority to be delivered against an individual identified as the boyfriend of an escort who allegedly had a sexual relationship with Stuart Rosenfeldt, one of the law partners of Rothstein’s law firm; Rothstein Rosenfeldt Adler, when he threatened to expose his girlfriend’s relationship with Rosenfeldt. According to court records, Benjamin purportedly ordered Poole, and two other unidentified officers to unlawfully use intimidation and force to enter the escort’s dwelling.

According to prosecutors, the three officers searched the house, took the woman’s cell phone and removed any evidence associated to Rosenfeldt after handcuffing her boyfriend. The woman was allegedly also told to “leave Florida or she would be arrested,” by one of the officers. The following day, two police officers arrived at her home and drove her to the airport telling her to return to Pennsylvania, according to court documents.

Based on testimony by investigators Benjamin again used Detective Poole to place Marcy Romeo, the ex-wife of Douglas Bates under arrest on a bogus prescription drug charge. Bates, was an attorney who had previously confessed to helping Rothstein perpetrate the immense $1.4 billion investment fraud. According to Ms. Romeo, the false arrest was illustrated to assist Bates in a child custody fight.

In 2009, Romero filed a federal law suit against her ex-husband and Benjamin, in what she labeled her wrongful arrest after a traffic stop initiated by Poole. Both Benjamin and Poole are accused of abusing their law enforcement influence and authority although Poole’s lawyer said that his client received no monetary compensation for the traffic stop and believed he had legal validation to arrest the woman and was only following orders from his superior officer.

When Poole’s lawyer was asked if he thought his client was betrayed, he responded by saying, “I think he was… He didn’t know what he was getting into or the extent of it.” The attorney also said that his client now regrets his actions and believes that Benjamin will most likely face a longer sentence in federal prison than his client when judgment for their respective actions are considered by use of the sentencing guidelines. “He gets what essentially is a command from his superior officer and he follows it… It’s unfortunate that a distinguished law enforcement career is going to end because of one aberrant incident like this,” said the attorney.

Additionally, Bates is now cooperating with the government and is slated to be sentenced in the near future for his role in the Ponzi scheme.

Despite Poole’s attorney’s comments, Benjamin’s charges of conspiring to commit extortion and violate civil rights has him facing a maximum sentence of five years in federal prison. If convicted, Poole faces up to ten years of incarceration for conspiring to violate civil rights.

To read a previous blog post regarding others implicated and convicted in the Scott Rothstein Ponzi Scheme case click here.
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Iranian National Sentenced in Manhattan Federal Court for Export Conspiracy

November 25, 2013 | Michael B. Cohen, P.A.

The International Emergency Economic Powers Act (IEEPA), sanctioned in October 1977, is a United States federal law empowering the regulation of commerce after a National emergency is declared in reaction to any uncommon and/or extraordinary threat to the Nation which originates from a non-American (foreign) source.

Subsequent to the terrorist attacks which included the bombing of the World Trade Center in New York City and the Pentagon in Washington, D.C., President George W. Bush enacted an Executive Order under the IEEPA to block assets of any persons or organizations deemed to have terrorist ties. He delegated blocking powers led by the U.S. Treasury to various federal agencies.

Additionally, in 2006, the United Nations Security Council passed a Resolution to impose sanctions on Iran after the government refused to suspend its uranium enrichment program.

On October 3, 2012, Seyed Ghorashi Sarvestani, an Iranian National, was arrested under the IEEPA. He pled guilty for conspiring to export merchandise from the U.S. to Iran on May 8 of this year and was sentenced to 30 months in federal prison this week in front of U.S. District Judge Paul G. Gardephe who also accepted his guilty plea. Among the items that were transported abroad over the past 7 years was sensitive satellite-related equipment that Sarvestani had been exporting through his companies. In addition to the two and one half year period of incarceration Sarvestani was also fined $100,000 and commanded to forfeit $54,000. He was also ordered to pay a $100 special assessment by Judge Gardephe.

According to a press release published by the Department of Justice, the Complaint, specifies, that the Information to which Sarvestani pled guilty and the testimony delivered during the action against him is as follows.

“Sarvestani, an Iranian national, was an owner of, and served as a managing director and director of, two related companies based in the United Arab Emirates. In that capacity, he worked with others to export electronic equipment used for satellite communications and data transfer, as well as other goods, from the United States to Iran, without the requisite approval from the U.S. Department of Treasury, Office of Foreign Assets Control.

Sarvestani and others conspired to acquire satellite technology and hardware from a supplier based in the United States, for shipment to Iran. To conceal the true destination of the goods from the U.S. supplier, Sarvestani and his co-conspirators arranged for the items to be shipped first to the United Arab Emirates and subsequently shipped to Iran.”

Sarvestani’s actions are a clear violation of the Iran Trade Embargo. Similar cases prosecuted this year involving the transport and the exporting of American manufactured industrial products to Iran include an indictment by a federal grand jury of Ali Saboonchi, 32, a United States citizen from Parkville, Maryland, who was partnering with Arash Rashti Mohammad, 31, an Iranian resident.

Saboonchi, through his companies shipped merchandise to the United Arab Emirates (UAE) which was then relayed to Iran. Selected items that were shipped are described as cyclone separators which are used in the refining process of oil. They also exported thermocouples which are used to measure the temperatures of gas and oil products. Mohammad was stationed in the United Arab Emirates. He and Saboonchi conspired to create Saboonchi’s company, Ace Electric, for the purpose of selling the prohibited goods using the UAE as a transit point before they continued on to buyers in Iran.

The International Emergency Economic Powers Act (IEEPA) was raised in other cases dealing with foreign governments over the past two decades including the countries listed below:
Myanmar, since 1997 for its repression of democratic opposition, the Sudan, since 1997 for human rights violations and sponsoring terrorism, Russia, which was initiated in 2000 to prevent export of weapons-grade uranium, Zimbabwe, since 2003 for the destabilization of democratic institutions, Syria, since 2004 for funding and support of terrorism and later for abuses of human rights, Belarus, since 2006 for undermining democratic organizations and North Korea, since 2008 for displaying the risk of the proliferation of weapon-usable fissile material

In the Sarvestani case, Preet Bharara, the United States Attorney for the Southern District of New York praised the investigative work of the New York Offices of the FBI, Immigration and Customs Enforcement, Homeland Security Investigations, the Defense Criminal Investigative Service of the Department of Defense, and the Office of Export Enforcement. He also expressed thanks to U.S. Customs and Border Protection for their help with the investigation.