Contra Costa Herald

News Of By and For The People of Contra Costa County, California

Three Romanians arrested for stealing Electronic Benefit Transfer information throughout state

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Charged with access device fraud in multi-district operation

California has reported loss of over $22 million due to EBT theft in first quarter of 2024, robbing low-income families of funds to buy food

By U.S. Attorney’s Office, Northern District of California

OAKLAND – Three individuals were charged with the use of unauthorized access devices were filed this week, announced United States Attorney Ismail J. Ramsey and United States Secret Service (“USSS”) – San Francisco Field Office, Special Agent in Charge Shawn Bradstreet.

The three defendants—Petrica Mosneagu, 44; Ionut Sopirla, 38; and Virgil Tudorascu, 42, all of Romania—were charged with stealing Electronic Benefit Transfer (“EBT”) account information and making fraudulent cash withdrawals at ATMs using that stolen EBT information in violation of 18 U.S.C. § 1029(a)(2). The defendants were arrested in a multi-district, USSS-led operation, which resulted in several arrests this week, including in the Southern District of California.

According to the public criminal complaints, law enforcement agencies have been investigating EBT theft across California for the past fourteen months. The complaints allege that the California Department of Social Services has identified that approximately $22.8 million has been stolen from victim EBT card beneficiaries from January to March 2024 in California, including in the Northern District of California. Most of these stolen funds have been obtained by unauthorized ATM withdrawals. Furthermore, the complaints allege that victims of the scheme are largely low-income families who depend on EBT benefits to buy food and other household necessities.

The complaints allege that the defendants fraudulently withdrew cash with “cloned” cards, which are debit cards, gift cards, or other devices with magnetic strips that have been encoded with information from legitimate EBT cards. The account holders’ account information was primarily “skimmed” at ATMs or point-of-sale terminals. Skimming devices recorded victim account holder account information on the magnetic strips and log their PINs through keypad overlays. Once skimmed, the victim account holders’ account information was then loaded onto blank or repurposed debit cards, which the defendants then used to withdraw cash or make purchases.

If convicted, each defendant face a maximum statutory sentence of ten years in prison on each charge. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.

Defendants Mosneagu and Sopirla made their initial appearances Tuesday morning in Oakland and will appear for their detention hearings on April 10, 2024, before the Honorable Kandis A. Westmore. Defendant Tudorascu made his initial appearance Thursday morning and will also appear for his detention hearing on April 10, 2024.

Criminal complaints only allege that crimes have been committed, and each defendant must be presumed innocent until proven guilty beyond a reasonable doubt.

Assistant U.S. Attorney Alexis James and Special Assistant U.S. Attorney Zachary Glimcher are prosecuting these cases, with the help of Katie Turner and Kay Konopaske. These prosecutions are the result of an investigation by the USSS, California Department of Social Services, U.S. Department of Agriculture – Office of Inspector General, Homeland Security Investigations (HSI), San Francisco Human Services Agency – Special Investigations Unit, Pleasant Hill PD, Richmond PD, Oakland PD, Berkeley PD, Alameda County Sheriff’s Office, Romanian National Police, and U.S. Secret Service Bucharest.

Richmond man arrested again, charged with multiple felonies for illegal weapons possession

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Guns seized from Hansen’s home in Richmond during his first arrest announced in February. Photos: CA DOJ

Cache of weapons included machine guns, assault rifles, silencers, homemade explosives

CA Attorney General announced first arrest in Feb., but state DOJ didn’t request prosecution and suspect was released, re-arrested March 17

By Ted Asregadoo, PIO, Contra Costa District Attorney’s Office

Martinez, California – The Contra Costa District Attorney’s Office filed a 21-count felony complaint against a Richmond man for possessing a large cache of illegal weapons, high-capacity magazines, and homemade explosives.

68-year-old Lawrence Robert Hansen (born 7/15/55) of Richmond is in custody after he was arrested on an outstanding warrant on March 17th by Richmond Police. Hansen is also listed on the Armed and Prohibited Persons System which tracks individuals who are barred from owning or possessing firearms.

Between 2022-2023, Hansen made several violent firearm-related threats to medical staff at a Walnut Creek clinic while seeking treatment. Staff members reported those threats to Walnut Creek Police on September 18th, 2023. In a separate incident, Hansen was transported to a hospital in Walnut Creek on September 26th, 2023, for a medical issue. During an examination, a staff member saw that Hansen had a handgun (later determined to be loaded) in his waistband area. The weapon was taken from Hansen and police were informed.

Because of the legal prohibition against Hansen possessing firearms, as well as threats made to medical employees, members from the Contra Costa Anti-Violence Support Effort Task Force, California Department of Justice’s (DOJ) Bureau of Firearms, and Contra Costa County Probation Officers searched Hansen’s residence with a court-ordered warrant in Richmond on January 31, 2024. During the search, agents found 11 machine guns, more than 130 handguns, 37 rifles, 60 assault rifles, 7 shotguns, 3,000 large capacity magazines, several grenades (inert), homemade explosives, incendiary ammunition, and around one million rounds of ammunition.

Hansen was arraigned on March 18th in Martinez. He entered a plea of not guilty and is being held without bail in the Martinez Detention Facility. A preliminary hearing is scheduled for March 27th in Department 23 at 8:30 am.

As previously reported, following the Jan. 31 search, California Attorney General Rob Bonta announced on Feb. 15 the arrest of Hansen. Asked why he was out of custody and arrested again on March 17, Asregadoo responded, “Upon receiving a request for prosecution (RFP) from the arresting police agency, a case undergoes review to determine whether to file charges. The RFP should include investigative reports and evidence relevant to the case. In the instance of Lawrence Robert Hansen, the arresting agency, Cal DOJ, did not immediately request prosecution at the time of arrest. Instead, Cal DOJ chose to finalize their investigation before submitting the request for prosecution along with associated reports and evidence to the Contra Costa District Attorney’s Office.”

According to the Contra Costa County Sheriff’s Office, Hansen is a 5-foot, 11-inch, 190-pound Hispanic man.

Case No. 02-24-00234 | The People of the State of California v. Hansen, Lawrence Robert

Allen D. Payton contributed to this report.

Pittsburg man, former president & CEO of metal finishing company sentenced to 30 months in prison for fraud

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Ferrari like the one purchased by Harry Corl, III. Photo: USDOJ  The former Santa Clara location of Nu-Metal Finishing, Inc. Source: finishingandcoating.com

Harry Corl, III also embezzled substantial company funds from employee stock ownership plan for luxury cars, Tiffany & Co. jewelry; required to pay $253,625.50 in restitution

By U.S. Attorney Northern District of California

SAN JOSE –was sentenced Tuesday, March 19, 2024, to 30 months in prison and ordered to pay $253,625.50 in restitution to over 30 victim employees and shareholders, announced United States Attorney Ismail J. Ramsey and Klaus Placke, Regional Director of the U.S. Department of Labor’s Employee Benefits Security Administration, San Francisco Regional Office.

Corl, now of Pittsburg, California, was indicted on several wire fraud and money laundering counts by a federal grand jury on November 29, 2018.  On September 25, 2023, he pleaded guilty to conspiracy to commit wire fraud in violation of 18 U.S.C. § 1349.

According to court filings, from 2008 to 2014, Corl and his estranged wife and co-defendant were executive officers for Nu-Metal Finishing, Inc. They also served as trustees of the company’s Employee Stock Ownership Plan and Trust, or ESOP, which provided retirement benefits and savings to the company’s employees by purchasing and investing company stock for their collective benefit.  As trustees, the Corls had a fiduciary duty to competently manage the ESOP’s cash, stock, and assets and act in the best interests of the employee-shareholders.  They failed to do so.

As set forth in the government’s sentencing memorandum, from 2011 to 2014, Corl used Nu-Metal’s corporate accounts to pay for numerous personal expenses wholly unrelated to the business of a metal finishing company.  For example, Corl used corporate funds to purchase extravagant jewelry from Tiffany & Co. and made lease payments on a Ferrari 599 GTB coupe, listing Nu-Metal Finishing as a lessee.  Corl also used corporate funds to lease a Bentley and to purchase outright a Mercedes S63 sedan.  The Corls flaunted their luxury car collection on social media.

Furthermore, in May 2014, the Corls arranged a fraudulent sale of Nu-Metal.  In all formal written agreements and conversations with all parties involved, the Corls represented themselves as the sole owners of the company, falsely stating that the ESOP had been terminated and was no longer a concern.  In reality, the ESOP and another shareholder owned well over 50% of the company’s outstanding stock and were owed their corresponding portion of the proceeds from the company’s sale.  However, Corl immediately transferred nearly the entire sale proceeds to his personal accounts and moved to Texas.  To date, the employees who participated in the ESOP, all laid off after the sale of the company, have not received any portion of the sale proceeds owed to them.  As indicated in the filed victim impact statements, these victims lost expected retirement income, and some have suffered serious financial distress a result.

The sentence was handed down by the Honorable Edward J. Davila, U.S. District Judge, who also sentenced Corl to pay $253,625.50 in restitution, serve a three-year period of supervised release, and pay a $100 special assessment fee.  The defendant will begin serving his sentence on June 13, 2024.

Marissa Harris is the Assistant U.S. Attorney prosecuting the case with the assistance of Sahib Kaur.  The prosecution is the result of a four-year investigation by the U.S. Department of Labor, Employee Benefits Security Administration.

Alamo doctor sentenced to prison for distributing opioids outside scope of medical practice

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Photo: CDC

Female defendant pleaded guilty to distributing Norco without a legitimate medical purpose; operated under the name “Mindful Medical”

By U.S. Attorney’s Office, Northern District of California

OAKLAND – Parto Karimi, a former Bay Area doctor, has been sentenced to one year and one day in federal prison for distributing powerful opioids outside the scope of medical practice, announced United States Attorney Ismail J. Ramsey and Drug Enforcement Administration (DEA), San Francisco Field Division, Special Agent in Charge Brian M. Clark. The sentence was handed down on March 15, 2024, by the Hon. Jon S. Tigar, United States District Judge.

Karimi, 59, of Alamo, California, pleaded guilty in July 2023 to one count of distributing hydrocodone, a Schedule II controlled substance, outside the scope of professional practice, in violation of 21 U.S.C. § 841(a)(1) and (b)(1)(C). According to the government’s sentencing memorandum, Karimi practiced medicine from an accessory dwelling unit on the grounds of her suburban home from roughly 2011 to 2022. Her practice operated under the name “Mindful Medical.” Karimi was a licensed practitioner of internal medicine who had previously worked as an emergency room doctor at an East Bay hospital and was authorized to prescribe controlled substances as part of her medical practice.

According to the government’s sentencing memorandum, the DEA began investigating Karimi after receiving concerning information from the family of one of Karimi’s former patients, who had passed away. The investigation included multiple visits by undercover agents to Karimi’s medical practice. During one, on October 1, 2021, an undercover agent asked Karimi for 10mg Norco tablets based on a claim of leg pain resulting from work as a restaurant server. Karimi admitted in her plea agreement that she wrote the undercover agent a prescription for 60 high-dose Norco pills without conducting a physical examination, without asking follow-up questions about the undercover’s reported pain, without obtaining medical records, and without exploring alternative treatment options or trying a lower dose. Karimi admitted that, in doing so, she knew she was acting in an unauthorized manner by prescribing a controlled substance outside the usual course of medical practice. She also admitted she knew the drug she prescribed was a powerful opioid that can be highly addictive and is liable to abuse by patients.

The government argued in its papers that Karimi wrote medical prescriptions for opioids like Norco in exchange for street drugs including cocaine and methamphetamine, as well as cash payments.

In addition to sentencing Karimi to prison, Judge Tigar ordered the defendant to serve three years of supervised release to begin after her prison term is completed. Judge Tigar also ordered the defendant to forfeit her California medical license and to pay a $4,000 fine.

Assistant United States Attorney Daniel Pastor is prosecuting the case with assistance from Laurie Worthen. The prosecution is the result of an investigation by DEA, with assistance from the United States Department of Health and Human Services – Office of Inspector General and the California Department of Justice Division of Medical Fraud and Elder Abuse.

Richmond man charged with smuggling ammunition from U.S. to Brazil

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Could face 10 years in  prison and $250,000 fine

By U.S. Attorney, Northern District of California

OAKLAND – On Monda, March 4, 2024, a federal grand jury indicted Edijalma De Souza Ferreira, charging him with smuggling ammunition from the United States to Brazil without an export license, announced United States Attorney Ismail J. Ramsey and Homeland Security Investigations (HSI) Special Agent in Charge Tatum King.

According to the indictment, filed February 27, Ferreira, 46, of Richmond, Calif., smuggled thousands of rounds of ammunition in two container shipments that were exported from the Port of Oakland in 2021. Export of the ammunition was contrary to the Export Control Reform Act and associated regulations. The indictment charges Ferreira with a felony violation of 18 U.S.C. § 554.

Ferreira was arrested on February 29, 2024, and made his initial appearance in federal court in Oakland the same day. He was released on bond and his next appearance is scheduled for March 6, 2024, before U.S. Magistrate Judge Donna M. Ryu for identification of counsel.

An indictment merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted, Ferreira faces a maximum sentence of ten years of imprisonment, and a fine of $250,000 for the 18 U.S.C. § 554 violation. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.

Assistant U.S. Attorney Michelle J. Kane is prosecuting the case with the assistance of Kathy Tat. The prosecution is the result of an investigation by HSI with assistance from the U.S. Department of Commerce, the U.S. Customs and Border Protection Container Security Initiative, the HSI Brasilia Attaché Office, and the Customs and Revenue Service of Brazil.

See case details at U.S. v. Ferreira, 4:24-cr-00120-YGR-1 (DMR) |

Bay Point, Antioch men convicted of drug trafficking

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Following wiretap investigation into East Bay drug suppliers and significant seizures of fentanyl, methamphetamine, cocaine and cash

Third man illegal alien from Mexico; among 13 defendants indicted in 2019

Each face maximum sentence of 20 years in prison for every count on which they were convicted

Attempt to use FBI investigation of APD officers as a defense denied

By U.S. Attorney’s Office, Northern District of California

SAN FRANCISCO – A federal jury has convicted three defendants—Luis Torres Garcia, Evan Martinez Diaz of Bay Point, and Timothy Peoples of Antioch—of multiple drug trafficking offenses following an eight-day trial, announced United States Attorney Ismail J. Ramsey and Drug Enforcement Administration (DEA), San Francisco Field Division, Special Agent in Charge Brian M. Clark. The jury convicted the defendants on all counts, rendering its verdict on February 14, 2024, after deliberating for two hours. The verdict followed a trial before the Hon. Richard Seeborg, Chief U.S. District Judge for the Northern District of California.

The three were among 13 defendants, including seven from Eastern Contra Costa County, indicted in May 2019 “on narcotics trafficking charges, announced United States Attorney David L. Anderson and Drug Enforcement Administration (DEA) Special Agent in Charge Chris D. Nielsen.  The indictment follows the arrest of five of the defendants on April 30, 2019, and the execution of search warrants at thirteen locations, including nine residences in Contra Costa County, Humboldt County, Fairfield, Suisun City and Modesto.” (See related article)

The evidence at trial included calls intercepted between April 2018 and February 2019 as part of a federal wiretap investigation into two drug suppliers in the East Bay. The intercepted calls established, among other things, that both suppliers received drugs from sources in Mexico. At trial, the government also presented evidence of several significant drug seizures including: 8.8 pounds of fentanyl and heroin in May 2018, valued at as much as $1.1 million, according to uncontested evidence at trial; 18 pounds of methamphetamine in August 2018; and 20 pounds of methamphetamine and one kilogram of cocaine in February 2019. The evidence at trial also established that law enforcement seized more than $300,000 in drug-related cash over the course of the investigation.

Martinez Diaz, 31, of Bay Point, California, was charged with three counts—conspiracy to distribute methamphetamine and cocaine, in violation of 21 U.S.C. §§ 846 and 841(a)(1) and (b)(1)(B); possession with intent to distribute methamphetamine, in violation of 21 U.S.C. § 841(a)(1) and (b)(1)(B); and possession with intent to distribute cocaine, in violation of 21 U.S.C. § 841(a)(1) and (b)(1)(B). The evidence at trial established, among other things, that on February 9, 2019, Martinez Diaz was transporting about 20 pounds of methamphetamine and one kilogram of cocaine through a residential neighborhood in Antioch, California, when he realized he was being followed by law enforcement—which knew about the drugs through intercepted calls. Martinez Diaz began driving erratically, briefly evading law enforcement and directing a co-conspirator to discard the drugs he was carrying in the bushes on a residential street. A short time later law enforcement located the drugs, which evidence at trial established had street retail values of $177,860 (methamphetamine) and $40,000 (cocaine). After Martinez Diaz was stopped by police and released with a traffic citation, he was intercepted on a call telling his supplier that he had seen law enforcement and discarded the drugs to avoid arrest. (See judge’s opinion)

Peoples, 44, of Antioch, California, was arrested after law enforcement officers found cocaine in his home, and charged with two counts of possession with intent to distribute cocaine, in violation of 21 U.S.C. § 841(a)(1) and (b)(1)(B)–(C). Evidence presented at trial showed that Peoples was a regular customer of an Antioch-based cocaine wholesaler from whom he bought some 10.5 pounds of cocaine for more than $120,000 in a 90-day period. Peoples used the codeword “babies” to refer to ounce quantities of cocaine. The evidence at trial established that Peoples then sold cocaine to his own customers in smaller quantities and used his proceeds to buy expensive cars.

Attempt to Use FBI Investigation of Antioch Police Officers to Defend Himself Denied

According to the judge’s opinion, “In the course of the federal law enforcement investigation in this case, the Drug Enforcement Agency (“DEA”) and Bureau of Alcohol, Tobacco, and Firearms (“ATF”) were assisted by officers from the Antioch Police Department in executing search warrants and evidence collection, the bulk of which occurred in 2018 and 2019. Since then, several Antioch police officers have been accused of, and indicted for various crimes, including civil rights violations and wire fraud.” (See related articles here and here)

During the court case, “Peoples insisted that the federal case against the Antioch officers was relevant because two members of the Antioch Police Department accused of misconduct were present at the search of Peoples’ home on April 30, 2019.”

The opinion continued, “The defendants previously filed a discovery motion to compel production of impeachment material related to Antioch police officers who assisted with the DEA and ATF investigation of the defendants in the instant case. That motion was denied.”

“An evidentiary hearing was set to determine threshold matters in relation to the motion. Having  considered the parties’ briefs, witness testimony, and admitted exhibits from the hearing, the government’s motion is granted, and the defendants are prohibited from referencing the federal investigation of any Antioch police officers.”

The opinion provided background to Peoples’ claim and the judge’s denial.

“Anticipating the issue would reappear at trial, the government filed MIL No. 12 to prevent the defendants from referencing Antioch police misconduct in the presence of the jury without first establishing relevance for fear that this would result in undue prejudice to the government. Dkt. (Docket) 489. In response, Peoples suggested that witnesses and the DEA-6 report regarding the search of Peoples’ home, authored by DEA Agent Mikhail Job, identified Antioch officers accused of misconduct as having participated in the April 30, 2019, search of Peoples’ residence.

Shortly before the pretrial conference, Peoples submitted a supplemental opposition to MIL No. 12 with information he and the government had just learned. Dkt. 521. In that supplemental opposition, Peoples contended that Agent Job had identified Antioch Officer Morteza Amiri, who has since been indicted on wire fraud charges and civil rights violations, as having entered Peoples’ residence alone for five to ten minutes along with his police dog after the occupants had been cleared out and before the official search began. Peoples also suggested that Antioch Officer Kyle Smith, who allegedly exchanged racist texts with other Antioch officers, joined the search of Peoples’ home. The government filed a supplemental response contending that Agent Job received erroneous information from the DEA case agents and had mistakenly named the wrong Antioch officers on his DEA-6 report. Dkt. 528. According to the government, Officers Amiri and Smith were not present at the search of Peoples’ home but were participating in the contemporaneous search of Defendant Lorenzo Lee’s residence. At the pretrial conference, the threshold question of whether Amiri was present at the search of Peoples’ home remained unresolved. The only potential relevance of the Antioch officers’ misconduct turned on whether  Amiri and/or Smith were present at Peoples’ residence such that Peoples could infer the police planted evidence.”

Furthermore, “Peoples failed to establish that a jury could reasonably find that Amiri was present at Peoples residence on April 30, 2019 by a preponderance of evidence. At the evidentiary hearing, both sides admitted several witnesses and exhibits, and the government’s evidence was considerably more persuasive. The government’s witnesses included several law enforcement agents who corroborated their version of the events on the day in question. The testimony of two Antioch officers, Kevin Tjahjadi and Brayton Milner, who participated in the search of Peoples’ residence, was particularly persuasive. Both stated unequivocally that neither Amiri nor Smith joined in that search. The Antioch Police Department CAD reports regarding the search of Peoples’ residence further supported this version of events, identifying only Tjahjadi and Milner as the participating officers.”

Torres Garcia, 38, an illegal alien from Mexico, residing in Rio Dell, California, was charged with conspiracy to distribute methamphetamine, in violation of 21 U.S.C. §§ 846 and 841(a)(1) and (b)(1)(A). The evidence at trial showed that Torres Garcia was a Humboldt County drug trafficker, who used the nickname “Guero.” Torres Garcia received methamphetamine shipments on credit from a Fairfield, California-based drug supplier. On August 8, 2018, the Fairfield supplier attempted to send about 18 pounds of methamphetamine—valued at $158,000—to Torres Garcia in Humboldt County. DEA agents and the Sonoma County Sheriff’s Office intercepted the drug courier and seized the drugs during a vehicle stop on Highway 101 near Healdsburg, California. In February 2019, the DEA tracked Torres Garcia to a meeting in Windsor, California, where Torres Garcia delivered about $13,800 in cash to a courier for his drug supplier. Although he was present throughout the trial and listened to closing arguments, Torres Garcia absconded before the jury handed down its verdict; he is now a fugitive. (See judge’s opinion)

According to the judge’s opinion, “Luis Garcia-Torres, defendant, an alien who had previously been deported or removed from the United States  to Mexico on or about May 19, 2016, was found in the Eastern District of Texas, said defendant not having received the express consent of the Attorney General and the Secretary of Homeland Security, the successor, pursuant to United States Code, Title 6, for re-application for admission to the United States, all in violation of 8 U.S.C. § 1326(a).”

Sentencing Hearing June 11, 2024

Judge Seeborg scheduled a sentencing hearing for June 11, 2024. Torres Garcia faces a maximum sentence of life imprisonment and a minimum sentence of 10 years in prison. Martinez Diaz and Peoples each face a maximum sentence of 20 years in prison for every count on which they were convicted. However, the defendants’ sentences will be imposed only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.

This prosecution is part of an Organized Crime Drug Enforcement Task Force (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles the highest-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten the United States by using a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.

Assistant U.S. Attorneys Daniel Pastor and Joseph Tartakovsky prosecuted the case with the assistance of Erick Machado. This prosecution is the result of an investigation led by the DEA Oakland Resident Office, with assistance from the Bureau of Alcohol, Tobacco, Firearms, and Explosives; Homeland Security Investigations; U.S. Customs and Border Protection; U.S. Postal Inspection Service; the police departments in Fairfield, Antioch, Concord, and Oakland; the Sonoma County Sheriff’s Office; and the California Highway Patrol.

Allen D. Payton contributed to this report.

 

APPS felony arrest in Richmond seizure of hundreds of illegal weapons, approximately one million rounds of ammunition

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Guns seized in Richmond arrest. Photos: CA DOJ

Including machine guns, assault rifles, silencers, suspected grenades

By Office of California Attorney General

CONTRA COSTA COUNTY — California Attorney General Rob Bonta announced today, Thursday, February 15, 2024, the arrest of a suspect in Richmond with a large cache of illegal firearms, including assault weapons, high-capacity magazines, and approximately one million rounds of ammunition. The suspect is alleged to be legally barred from owning weapons.

“This arrest demonstrates exactly why the Armed and Prohibited Persons System is vital for the safety of our communities,” said Attorney General Bonta. “In our efforts to retrieve guns from a prohibited individual, we found hundreds of allegedly illegal weapons and approximately one million rounds of ammunition. I am grateful for our Bureau of Firearms agents’ and local law enforcement partners’ work in getting these illegal weapons out of the hands of this prohibited individual.”

On January 31, 2024, agents from the California Department of Justice’s (DOJ) Bureau of Firearms (BOF) Contra Costa Anti-Violence Support Effort (CASE) Task Force assisted by the BOF Dublin office and Contra Costa County Probation Officers served a search warrant at the suspect’s residence in Richmond. During the search, several suspected grenades were discovered, and the Walnut Creek Police Department Bomb Squad and Travis Air Force Base Bomb Squad were asked to respond, and the grenades were found to be inert. After a thorough search of the residence, DOJ agents seized approximately 11 military-style machine guns, 133 handguns, 37 rifles, 60 assault rifles, 7 shotguns, 20 silencers, 4 flare guns, 3,000 large capacity magazines, approximately one million rounds of miscellaneous caliber ammunition, and dozens of rifle receivers and pistol frames. (See video.)

In 2006, California became the first state in the nation to establish a system for tracking firearm owners who fall into a prohibited status. The APPS database works to identify individuals who lawfully procured firearms and later became prohibited from owning or possessing them. In general, prohibited persons in APPS include individuals who were convicted of a felony or a violent misdemeanor, were placed under a domestic violence or other restraining order, or suffer from serious mental illness.

The 2022 APPS Report was released in April of 2023 and the 2023 APPS Report will be released in March 2024. DOJ’s BOF serves the people of California through education, regulation, and enforcement actions regarding the manufacture, sale, ownership, safety training, and transfer of firearms and ammunition. BOF staff are leaders in providing firearms expertise and information to law enforcement, legislators, and the general public in a comprehensive program to ensure legitimate and responsible firearm possession and use by California residents. BOF is looking to hire additional special agents and more information on assessments for relevant job openings can be found on DOJ’s website at oag.ca.gov/careers/exams.

 

Lafayette attorney indicted in the DC Solar billion dollar Ponzi scheme

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Faces 23 counts of conspiracy to commit wire & bank fraud, bank fraud, wire fraud

7 residents from Martinez, Clayton, Pleasant Hill, Walnut Creek & Vacaville convicted, fined and sentenced

Former Concord- and Benicia-based company

By U.S. Attorney’s Office, Eastern District of California

SACRAMENTO, Calif. — On Oct. 5, 2023, a federal grand jury returned a 23‑count indictment against Ari J. Lauer, 59, of Lafayette, charging him with conspiracy to commit wire and bank fraud, bank fraud, and wire fraud affecting a financial institution, for his role in the biggest criminal fraud scheme in the history of the Eastern District of California, U.S. Attorney Phillip A. Talbert announced.

Lauer is an attorney licensed to practice law in California, and from approximately 2009 to January 2019, he was outside counsel to DC Solar and provided legal and business advice concerning DC Solar’s operations. The indictment was unsealed today following Lauer’s arrest.

According to court documents, between 2011 and 2018, DC Solar manufactured mobile solar generators that were mounted on trailers. The company touted the versatility and environmental sustainability of the generators and claimed that they were used to provide emergency power to cellphone towers and lighting at sporting and other events. A significant incentive for investors were generous federal tax credits due to the solar nature of the generators. Jeff Carpoff, 52, Paulette Carpoff, 49, both of Martinez, and their co-conspirators solicited investors to invest in the generators in large multimillion-dollar transactions using a variety of fraudulent techniques.

A key part of the fraud was that investors would never actually take possession of the generators. Instead, DC Solar typically leased those generators back from the investors, and claimed to sublease them to third parties to generate revenue. In reality there was very little actual third-party rental demand for the generators, yet when Lauer and the other co-conspirators learned this, they continued to represent falsely to investors that the rental market for the generators was robust.

In June 2012, Lauer, Jeff Carpoff, and others met to discuss the failure to generate third-party lease revenue sufficient to meet their financial obligations to the investors. The conspirators agreed to conceal that lack of third-party lease revenue from current and prospective investors, by, among other things, making periodic transfers of investor money from one account to another while misrepresenting the flow of funds as third-party lease revenue. Lauer and other members of the conspiracy created a circular payment system they referred to as “re-rent.” In 2014, they created a “re-rent agreement,” backdating the document to 2011, and used it to explain the large sums of money being transferred from one account to another. In fact, the real source of money was new investor money, which was being used to pay obligations to existing investors. The indictment further alleges that Lauer and other members of the conspiracy prepared sublease agreements with “concealed addendums” that materially altered the terms of the contracts. They used the sublease agreements to defraud investors.

Between March 2011 and Dec. 18, 2018, investors collectively invested approximately $759,400,000 and several financial institutions and other investors transferred collectively $152,700,000 to DC Solar as part of related transactions for the purchase and lease of generators. In total, DC Solar closed transactions with investors that contributed an aggregate of more than $912 million to purchase generators. Those transactions purportedly involved approximately 17,000 generators, at approximately $2.5 billion in purported value.

During the conspiracy, approximately 94% to 95% of the supposed lease revenue on the books was actually intercompany transfers disguised as new investor money. In truth, third-party end-user demand for generators never exceeded 5% of the revenue that was claimed. (Learn more about the DC Solar scheme)

This case is the product of an investigation by the Federal Bureau of Investigation, IRS Criminal Investigation, and the Federal Deposit Insurance Corporation Office of Inspector General. Assistant U.S. Attorney Audrey Hemesath is prosecuting the case.

On Nov. 9, 2021, Jeff Carpoff was sentenced to 30 years in prison and ordered to pay $790,600,000 in restitution for conspiracy to commit wire fraud and money laundering. His wife Paulette Carpoff pleaded guilty to conspiracy to commit an offense against the United States and money laundering. She was sentenced on June 28, 2022, to 11 years and three months in prison.

On Nov. 16, 2021, Joseph W. Bayliss, 48, of Martinez, was sentenced to three years in prison and ordered to pay $481,300,000 in restitution for securities fraud and conspiracy in connection with the DC Solar scheme. On April 12, 2022, DC Solar CFO Robert A. Karmann, 57, of Clayton, was sentenced to six years in prison and ordered to pay $624 million. On May 31, 2022, Alan Hansen, 50 of Vacaville, was sentenced to eight years in prison for conspiracy to commit an offense against the United States and aiding and abetting money laundering. Ryan Guidry, 48, of Pleasant Hill, was sentenced on Jan. 31, 2023, to six years and six months in prison and ordered to pay $619,415,950 in restitution for to conspiracy to commit an offense against the United States and aiding and abetting money laundering.

Ronald J. Roach, 55, of Walnut Creek, pleaded guilty to criminal offenses related to the fraud scheme and is scheduled to be sentenced on Nov. 14, 2023. Roach faces a maximum statutory penalty of 10 years prison. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.

lauer_indictment.pdf

Allen D. Payton contributed to this report.

 

CEO of Richmond non-profit sentenced to 17 years in prison for bank and wire fraud, witness tampering, more

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Provided homes for parolees, probationers; used multiple aliases

Sought $34,655,437 in fraudulent PPP loans during COVID

Jury found former religious leader guilty on 44 felony counts

By U.S. Attorney’s Office, Northern District of California

OAKLAND – Attila Colar, aka Dahood Sharieff Bey, aka Sharieff Dahood Bey, aka Sharieff Pasha, aka David Lee, aka Georgi Petrakov, was sentenced to serve 204 months (17 years) in prison after being convicted of forty-four (44) felonies including conspiracy, bank fraud, wire fraud, aggravated identity theft, false statements to a bank, destruction of property to prevent a search, possession of a firearm as a felon, making a false tax return, obstruction, and witness tampering. The sentence was handed down by the Honorable Haywood S. Gilliam, Jr., U.S. District Judge.

Colar, 51, of Richmond, Calif., was convicted of the crimes by a jury on June 23, 2023, after a three-week trial. Colar is the former Chief Executive Officer of All Hands on Deck, a Richmond, Calif., company that held itself out as providing a residential reentry home for probationers, parolees, homeless persons, and persons with mild mental illness. In finding him guilty of the sundry crimes, the jury concluded Colar carried out multiple schemes to defraud, including defrauding organizations that placed residents at his company’s transitional housing facilities and defrauding several lenders that were participating in the Paycheck Protection Program (PPP). The jury also found that Colar attempted to destroy evidence, obstructed the FBI’s and grand jury’s investigations into his crimes, and tampered with a witness by attempting to concealing the witness while law enforcement was taking steps to execute a material witness order.

According to opengovus.com the organization was incorporated in Hercules and is listed as a “Minority-Owned”, and “Black American Owned” non-profit in 2015 but the registration has expired. The only officer listed is Jamlia Pasha as Manager.

According to transitionalhousing.org, “All Hands on Deck Ink is a clean and sober living environment that offers a structured living program for recovering individuals, Homeless Veterans, Parolees, and Individuals with Mental Health Conditions. The environment creates good habits and healthy outlooks that will lead their residents to positive results. Offer all of the residents access to a clean and stable environment, life skill courses, 12 step program, educational opportunities, business and economic training, and resource referrals. There is a sliding scale fee. Accept self pay, vouchers and other housing rent assistance programs. Residents will have access to internet, washer and dryer, cable, a healthy meal, programs, resources and more. As accepting new residents now, call their housing managers today for placement.” It has a location at a home in El Sobrante. That information was last updated on July 13, 2023.

“In the wake of a national crisis, the government established programs, including the Paycheck Protection Program, to ease the pain inflicted by a global pandemic,” said Ismail J. Ramsey, United States Attorney for the Northern District of California. “Colar took this opportunity to defraud the government, while also defrauding several other initiatives intended to help the homeless, newly released prisoners, and those with drug problems, to name just a few of his victims. This sentence should serve as a warning that this office will pursue with vigor those who seek to line their own pockets by defrauding government efforts to address our communities’ needs.”

“Colar is now facing the consequences for his attempt to steal from a taxpayer-funded program designed to offer crucial relief to those businesses affected during the pandemic,” said Robert K. Tripp, Special Agent in Charge, San Francisco Field Office, Federal Bureau of Investigation. “We are proud to have worked in close coordination with our federal partners to ensure justice prevailed in this case.”

“This sentencing sends a clear warning that you will be brought to justice if you defraud the federal government of pandemic relief funds,” said Jon Ellwanger, Special Agent in Charge, Western Region, Office of Inspector General for the Board of Governors of the Federal Reserve System and Consumer Financial Protection Bureau. “We are proud to have worked with our federal law enforcement partners and the U.S. Attorney’s Office to hold Mr. Colar accountable for his crimes.”

“Abusing SBA’s pandemic relief programs that are intended to provide critical relief to small businesses is unconscionable.” said SBA OIG’s Western Region Special Agent in Charge Weston King. “This sentencing further showcases that those who fraudulently take advantage of federal government programs will face justice for their selfish deeds. I want to thank the U.S. Attorney’s Office and our law enforcement partners for their dedication and commitment to seeing justice served.”

“Mr. Colar attempted to defraud the U.S. government by filing multiple false tax documents to further his Paycheck Protection Program scheme. Along the way, he harmed the members of the community those funds are designed to aid and protect,” said IRS-Criminal Investigation Special Agent in Charge Darren Lian of the Oakland Field Office. “This sentencing reinforces that people who abuse the U.S. tax system and victimize taxpayers will be held accountable. IRS Criminal Investigation agents work closely with multiple agencies to help ensure those who choose to break the law are caught and punished. I would like to thank the United States’ Attorney’s Office’s and its federal partners for working together to achieve a just result.”

“When individuals corruptly obstruct the due administration of the Internal Revenue Code and file documents under false pretenses, they defraud and steal funds from taxpayer-funded programs intended to assist small businesses. TIGTA will always pursue these individuals and ensure they are prosecuted to the fullest extent of the law,” stated Special Agent in Charge Rod Ammari. “I want to thank our law enforcement partners and the U.S. Attorney’s Office for their joint efforts to hold these criminals accountable for their actions.”

Evidence at trial showed that starting in late 2018, Colar engaged in a scheme to defraud, among others, GEO Reentry, which provided treatment and supervision programs for adult probationers, parolees, and pretrial defendants in residential, in-custody, and non-residential reentry centers for the California Department of Corrections and Rehabilitation (CDCR). Specifically, in or about 2019, Colar fraudulently induced GEO Reentry to refer parolees to All Hands on Deck using falsified fire inspection clearance reports, a false letter of recommendation, false security clearance documents, and false and misleading information about its staff.

Additional evidence demonstrated that in April and June of 2020, Colar engaged in a second scheme to defraud lenders participating in the PPP lending plan authorized by the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The CARES Act was designed to provide emergency financial assistance to the millions of Americans who were suffering from the economic effects caused by the COVID-19 pandemic. Pursuant to the CARES Act, the SBA managed the PPP lending plan. Trial evidence established Colar submitted multiple loan applications on behalf of All Hands on Deck to lenders that were false and misleading. For example, the applications substantially overstated the number and payroll of All Hands on Deck employees—while Colar’s loan applications stated All Hands on Deck had approximately 73 to 81 employees, the business had, in fact, perhaps other than himself, no salaried employees.

Colar was also convicted of offenses related to the submission of multiple fraudulent loan applications in the name of other companies. The evidence demonstrated Colar hastily revived two dormant companies, and then submitted loan applications from the PPP lending plan for the bogus businesses. To carry out this scheme to defraud, Colar used, without legal authority, the names and identities of two persons living in his residential reentry facility. Colar falsely represented that the residents were “CEO”s of companies with hundreds of employees with million-dollar payrolls.

In all, the evidence at trial showed that Colar submitted a total of 16 fraudulent loan applications to the PPP lending plan seeking approximately $34,655,437 in PPP loans.

Colar also was convicted of obstruction and witness tampering relating to the investigations into his crimes. Colar has been found guilty of destroying documents during a search of his home, lying to the FBI about a firearm, falsifying records produced to the grand jury, interfering with the representation by counsel of a material witness by impersonating the witness’s Power of Attorney, coaching a witness to falsely state that the witness was the CEO of one of Colar’s bogus companies that submitted fraudulent loan applications, and concealing a witness in multiple hotels and other locations in the Bay Area to forestall or prevent the witness from providing testimony in the federal grand jury.

In sum, Colar was convicted of forty-four (44) federal criminal offenses for his conduct. The convictions include the following: one count of conspiracy to commit wire fraud, in violation of 18 U.S.C. § 1349; one count to commit conspiracy to commit bank fraud and wire fraud, in violation of 18 U.S.C. § 1349; two counts of bank fraud, in violation of 18 U.S.C. § 1344; sixteen counts of wire fraud, in violation of 18 U.S.C. § 1343; eight counts of aggravated identity theft, in violation of 18 U.S.C. § 1028A; two counts of false statement to a bank, in violation of 18 U.S.C. § 1014; one count of possession of a firearm by a felon, in violation of 18 U.S.C. § 922(g); one count of destruction of property to prevent a search or seizure, in violation of 18 U.S.C. § 2232(a); one count of obstruction of justice, in violation of 18 U.S.C. § 1512(c)(2); two counts of falsification of records in a federal investigation, in violation of 18 U.S.C. § 1519; six counts of making a false tax return, in violation of 26 U.S.C. § 7206; one count of conspiracy to tamper with a witness, in violation of 18 U.S.C. § 1512(k); one count of tampering with a witness, in violation of 18 U.S.C. § 1512(b)(1); and one count of tampering with a witness, in violation of 18 U.S.C. § 1512(b)(2).

In addition to the prison term, Judge Gilliam also ordered Colar to serve 60 months (five years) of supervised release, to begin after his prison term. Restitution will be determined at a later date. Colar is currently in federal custody and will begin serving his prison term immediately.

According to an Oct. 3, 2020 ABC7 News report, “Colar was the leader of a Black Muslim temple in Oakland and a group that was a spinoff of Your Black Muslim Bakery, after the leader of the bakery was arrested and later convicted of ordering the murder of Oakland journalist Chauncey Bailey.” He “was convicted in 2015 and sentenced to five years in state prison for submitting bogus documents to win security contracts with Alameda County, the Los Angeles Department of Water and Power and the Housing Authority of the City of Los Angeles.”

Assistant U.S. Attorneys Barbara J. Valliere, Adam A. Reeves, and Ross D. Mazer are prosecuting the case with the assistance of Paralegal Specialist Laurie Worthen and Legal Assistant Kathy Tat. The prosecution is the result of an investigation by the FBI, IRS-Criminal Investigation, Office of Inspector General for the Board of Governors of the Federal Reserve System and Consumer Financial Protection Bureau, Internal Revenue Service: Criminal Investigation, Treasury Inspector General for Tax Administration, and Office of Inspector General for the U.S. Small Business Administration.

Allen D. Payton contributed to this report.

 

Danville woman sentenced to 22 months in federal prison for embezzling $1.7 million from Men’s Warehouse

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Gina Lonestar in happier times. Source: Her Facebook page posted May 27, 2022.

Former VP of Construction, Maintenance and Facilities at parent company Tailored Brands invented fake vendor and submitted false invoices over eight-year period

By U.S. Attorney’s Office, Northern District of California

OAKLAND – Gina Suzanne Lonestar was sentenced to 22 months in federal prison in connection with a wire fraud scheme pursuant to which she embezzled over $1.7 million from her former employer, announced United States Attorney Ismail J. Ramsey and Federal Bureau of Investigation (FBI) Special Agent in Charge Robert K. Tripp. The sentence was handed down by the Hon. Jon S. Tigar, United States District Judge.

Lonestar, 52, of Danville, Calif., pleaded guilty to the charge on May 19, 2023. According to her plea agreement, Lonestar admitted that, in December 2010, she devised a scheme to create a fake vendor to defraud Men’s Wearhouse and later Tailored Brands (Men’s Wearhouse’s parent company) of money by submitting and approving false invoices for the fake vendor to the accounts payable department. Lonestar created a document stating the vendor was a sole proprietorship associated with a family member and then began submitting and approving invoices falsely claiming the vendor was performing work at Men’s Wearhouse stores throughout California, such as inspections and handyman work. Lonestar admitted that she submitted and approved false invoices in the name of the fake vendor for approximately eight years, defrauding her employer of over $1.7 million, which was paid to her joint checking account. Lonestar admitted that the vendor did not exist and the family member with whom she co-owed the company performed none of the work for which she provided invoices.

At the time Lonestar devised the scheme, she was a Director in the Facilities Department of Men’s Wearhouse. During the relevant time period she was promoted to Senior Director of Facilities and Corporate Services and then to Vice President of Construction, Maintenance, and Facilities. In all of her roles, she had the authority to approve invoices for work done by vendors. Lonestar’s scheme ended in 2019 when the company discovered the conduct during an internal audit.

On September 8, 2022, a federal grand jury indicted Lonestar charging her with six counts of wire fraud, in violation of 18 U.S.C. § 1343. Pursuant to her plea agreement, Lonestar pleaded guilty to one count and the court dismissed the remaining counts during her sentencing hearing.

In addition to the 22-month sentence, Judge Tigar ordered Lonestar to pay a $1,736,216 forfeiture money judgment and to serve three years of supervised release which will begin after she leaves prison. Judge Tigar ordered that Lonestar begin serving her sentence on January 5, 2024. In addition, Judge Tigar scheduled a hearing for December 1, 2023, to determine issues regarding restitution.

The case is being prosecuted by Assistant United States Attorney Noah Stern with assistance from Elizabeth Kim and Kathleen Turner. The prosecution is the result of an investigation by the FBI.