Fugitive Appears in Court; Charged with Narcotics and Firearms Trafficking, Money Laundering, and Criminal Conspiracy

A former Passaic County man who has been a fugitive since 2009 made his initial court appearance Friday, February 8, 2013. The investigation leading to his apprehension was conducted by U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI), the FBI, and the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF).

Kujtim Lika, 47, formerly of Passaic County, N.J., appeared in Newark Federal Court Friday, February 8, 2013, to face numerous charges, including narcotics and firearms trafficking, money laundering, interstate transportation of stolen property, and criminal conspiracy.

According to court documents, three years ago, 26 individuals were charged – including Lika – with multiple crimes in connection with an investigation into several loosely connected Balkan criminal enterprises operating throughout New Jersey, New York, Chicago, Philadelphia, Canada, and the Netherlands. The arrests were part of a federal joint operation that began in 2003.

Lika's case was featured on the television program "America's Most Wanted." He was subsequently apprehended May 24, 2012, by the Toronto Police Department/Toronto Task Force in Canada. He had been using the alias, "Dashamir Cela" at the time of his arrest.
He was detained without bail.

The charges and allegations against Lika are merely accusations, and the defendant is considered innocent unless and until proven guilty.

Maryland Man Arrested for 2012 Murder

An Anne Arundel County, Md. man was arrested recently at a New York airport after a warrant was issued charging him with the murder of a Frederick County, Md. man, whose body was found in the trunk of his car last December by a special agent of U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI).

Michael A. Stahlnecker, 51, of the 1700-block of Fallsway Drive, Crofton, Md., is charged in the District Court of Maryland for Anne Arundel County with first and second degree murder, first and second degree assault, reckless endangerment, and use of a firearm in the commission of a felony, violent crime.

Stahlnecker was arrested shortly before 6:00 a.m. Feb. 12 by HSI New York and Frederick special agents, the Port Authority of New York and New Jersey and the U.S. Marshals Service, as he prepared to board a flight at the JFK International Airport. Investigators from the Maryland State Police (MSP) Homicide Unit, the State Apprehension Team and the Frederick County Narcotics Task Force were with federal agents and Port Authority Police when the arrest was made. Stahlnecker is currently held on a fugitive warrant in New York pending extradition proceedings to return him to Maryland.

The victim is identified as John P. Ryan, 37, of Frederick, Md., whose body was found in his 2007 Lexus in a parking lot in the 15000-block of Somerville Drive, Derwood, Md., on the afternoon of Dec. 3, 2012. Police had been searching for Ryan since his wife reported him missing to the Frederick Police Department on Nov. 29, 2012.

Since the MSP Homicide Unit became involved with this investigation, investigators have worked closely with the Frederick County Narcotics Task Force. HSI special agents along with task force investigators had initiated an investigation in the summer of 2012 into allegations that Ryan and associates were involved in the importation and distribution of marijuana. Stahlnecker was identified as a close associate of Ryan's in this operation.

MSP homicide investigators believe Ryan had a meeting scheduled with Stahlnecker on the morning of Nov. 28, 2012, at a warehouse leased by the suspect in the 3300-block of Laurel Fort Meade Road, Laurel, Md. A search warrant served at the address resulted in the recovery of Ryan's blood near the rear loading dock and on the bristles of a broom outside the rear of the business.

Investigators believe evidence indicates Ryan was shot at the warehouse location and then driven in his car to the address in Montgomery County where his body was found in the trunk. A motive has not been confirmed at this time, however, investigators determined Stahlnecker owed large amounts of money to several persons.

The investigation is continuing and the case is being prosecuted by the Anne Arundel State Attorney's Office.

3 California Men Indicted for Credit Card Fraud Scheme

Three Los Angeles-area residents have been indicted by a federal grand jury following a probe by U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI) and the U.S. Secret Service that allegedly revealed the defendants orchestrated a far-reaching scheme to import and produce counterfeit debit and credit cards.

The defendants - Jose Rolando Renderos, 38, of Montebello; his son, Jose Ulloa, 18, of San Bernardino; and Milagro del Carmen Alvarez Hernandez, 27, of Montebello - are charged in a nine-count indictment handed down Tuesday, February 12, 2013, with a variety of violations, including access device fraud; possession of counterfeit access devices; and trafficking in counterfeit goods. All three defendants are currently in federal custody. They are expected to be arraigned Feb. 25.

According to the case indictment, defendants Renderos and Ulloa would obtain blank counterfeit credit cards from China. The phony cards bore the names and logos of such well-known financial institutions as American Express, Capitol One, U.S. Bank and Wells Fargo. The indictment alleges the father and son then embossed and activated the counterfeit cards using actual credit card numbers illegally obtained from point of sale devices.

"Credit card fraud scams like this result in major losses for the affected financial institutions and it's ultimately consumers who pay the price," said Claude Arnold, special agent in charge for HSI Los Angeles. "HSI will continue to work closely with its federal law enforcement partners to target criminal schemes that undermine the integrity of our financial system."

The defendants allegedly kept unembossed card stock in a storage unit in Monterey Park. When federal agents executed a search warrant at the location Feb. 6, they recovered a cache of more than 80,000 cards, along with an embossing machine and multiple credit card skimmers. So far, investigators have seized more than 90,000 counterfeit credit cards in connection with the case. Given the minimum credit limit of $500 per card, authorities conservatively estimate the value of the phony access devices at $45 million.

"Cooperation and partnerships have allowed us to focus our resources and respond quickly to uncover and prevent these types of crimes, whether they originate within or outside our borders," said U.S. Secret Service, Los Angeles Field Office Special Agent in Charge Joseph F. Beaty Jr.

The probe into the credit card scheme is still ongoing, but investigators believe the defendants may have been using the counterfeit cards to purchase high-end merchandise for re-sale. According to the indictment, Alvarez used one of the counterfeit cards in December to purchase more than $1,600 worth of merchandise at a children's boutique in Los Angeles.

The probe leading to the indictments of Tuesday, February 12, 2013, began two weeks ago after officers with U.S. Customs and Border Protection (CBP) intercepted four packages from China that were being shipped to San Bernardino, Calif. Inside, officers discovered more than 12,000 counterfeit credit cards.

The probe is being spearheaded by HSI with substantial assistance provided by the Los Angeles Field Office and Riverside Residence Office of the U.S. Secret Service.

Federal Authorities Shut Down Mexican Drug Tunnel

On Wednesday, February 13, 2013, federal authorities shut down a just-completed, cross-border drug smuggling tunnel and seized more than 1,200 pounds of marijuana following a multi-agency investigation by the Nogales Tunnel Task Force, with significant assistance from U.S. Customs and Border Protection Border Patrol in Nogales.

Officers with the Tunnel Task Force, which is led by U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI), were conducting surveillance in Nogales around noon and observed a van in a parking lot at the south end of Nelson Avenue, approximately 200 yards east of the Morley Pedestrian Gate. After noticing suspicious activity, the investigators approached the van, which was loaded with marijuana bundles. Two men near the van attempted to flee on foot, but were apprehended by task force officers not far from the tunnel and taken into custody.

Task force officers seized 22 bundles of marijuana from the van and 29 bundles of marijuana from inside the tunnel, weighing a total of 1,210 pounds.

The crude, hand-dug tunnel is approximately 68-feet-long and averages approximately two feet wide. The passageway does not contain any wooden shoring, ventilation or electrical equipment. The tunnel location closely parallels a March 2012, drug tunnel discovered in the same location. The tunnel entrance is located in the front yard of a private residence in Nogales, Mexico, and runs for approximately 26-feet underground before passing under the international boundary and running 42-feet on the U.S. side of the border. The tunnel exits on an embankment at the south end of Nelson Avenue.

Mexican authorities responded to the area and secured the tunnel entrance in Mexico. The tunnel will be guarded by Border Patrol agents until it is rendered unusable. The investigation remains ongoing, but investigators believe the tunnel had just been completed early Wednesday, February 13, 2013.

"Members of the Tunnel Task Force each bring unique capabilities from their respective agencies, which greatly enhances our ability to identify and interdict drug tunnels," said Eric Balliet, assistant special agent in charge of HSI Nogales. "In this case, the task force developed information that a tunnel was being excavated in the area. Through the diligence and hard work of all the participating agencies, we were able to shut this tunnel down just as it was completed, stopping its very first load of drugs."

In the last three years, federal authorities have discovered and shut down 26 completed cross-border smuggling tunnels in the Nogales area.

The Border Enforcement Security Task Force (BEST) is an HSI-led, multi-agency U.S. Department of Homeland Security (DHS) initiative to identify, disrupt and dismantle criminal organizations that seek to exploit vulnerabilities along U.S. borders. There are currently 34 BEST units deployed across the country, covering major seaports and southern and northern border regions. BEST units are composed of more than 750 law enforcement officers from more than 100 federal, state, local, tribal, and foreign law enforcement and intelligence resources.

BEST Nogales Tunnel Task Force is composed of full time members from HSI, U.S. Customs and Border Protection, Office of Border Patrol, Nogales Police Department, the Santa Cruz County High Intensity Drug Trafficking Area task force and the U.S. Drug Enforcement Administration. BEST Nogales Tunnel Task Force is responsible for identifying, investigating and eliminating illicit subterranean tunnels in one of the nation's busiest border areas with Mexico and combating the Transnational Criminal Organizations that finance, build and use them.

Texas Resident Guilty of Smuggling Marijuana

A Kingsville, Texas, man was found guilty Monday, February 4, 2013, of conspiracy to possess with the intent to distribute more than 100 kilograms of marijuana, announced U.S. Attorney Kenneth Magidson.

This conviction resulted from an investigation conducted by U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI), and the Kingsville Narcotics Task Force.

Michael "Mickey" Pena, 45, was found guilty by a federal jury for participating in a drug trafficking organization that transported large amounts of marijuana concealed in the hulls of altered shallow-bottom fishing boats. The marijuana was transported via the intracoastal waterway from Port Mansfield to Corpus Christi to circumvent Border Patrol checkpoints in Falfurrias and Serta, Texas. The federal jury returned their verdict in Corpus Christi after deliberating only 30 minutes following the trial that lasted less than a day.

"Drug smugglers seek the path of least resistance," said Brian M. Moskowitz, special agent in charge of HSI Houston. "The great collaborative work of our special agents and law enforcement partners in this case should give pause to trafficking organizations who seek to exploit our coastal waters to move illegal drugs into this country."

Court testimony revealed that in early 2012, drug trafficking organization members deconstructed a 21-foot Dargel Scout fishing boat over 20 days. The hull of the vessel was then loaded with more than 1,100 pounds of marijuana, and the deck of the boat was rebuilt. The boat was then launched in Port Mansfield and co-defendant Rogelio Mendoza drove it north. 

Marine interdiction agents with U.S. Customs and Border Protection (CBP) intercepted the vessel just south of Corpus Christi.

Subsequent investigation by HSI revealed that Pena arrived at marker 37 with an empty boat trailer shortly after the boat was intercepted and had registered the vessel in his name two weeks earlier. Certified state documents showed that the previous owner of both the boat and the empty trailer were members of the drug trafficking organization. Special agents also testified that they had conducted surveillance of organization members scouting boat ramps near marker 37 about six weeks before the seizure and then immediately drove to Pena's Kingsville residence.

Mendoza, 37, and five other members of the conspiracy had previously pleaded guilty before U.S. district judges in Corpus Christi and have been or are awaiting sentencing. Those drug trafficking members include: Alberto Lopez, aka Alberto Lopez-Reyna, 39, Lombardo Zarate, 49, Glen Dial, 56, Luz Ramirez, 25, and Hector Perez-Gonzalez, 39.

Senior U.S. District Judge Janis Graham Jack, who presided over the trial, has set sentencing for April 17, at which time Pena will face a minimum of five and up to 40 years in prison, as well as a possible $5 million fine, and a substantial money judgment. Pena will remain in custody pending sentencing.

Assistant U.S. Attorney Jeffrey D. Preston, Southern District of Texas, prosecuted the case. 

California Company Fined by ICE for Hiring Illegal Immigrant Employees

As part its enforcement strategy to reduce illegal employment and protect job opportunities for the nation's lawful workforce, U.S. Immigration and Customs Enforcement (ICE) announced Tuesday, February 5, 2013, that 10 employers in San Diego and Imperial counties were fined by ICE during fiscal year 2012 for various employment-related violations.

Collectively, the fines totaled more than $173,800, with the largest fine, $50,000, being lodged against a San Diego-area medical transportation service. The fines were imposed after ICE Homeland Security Investigations (HSI) found the businesses had failed to comply with laws prohibiting the hiring of unauthorized workers.

One of the ways HSI identifies potential hiring violations is by auditing employers' Form I-9s, the document businesses use to verify an employee's eligibility to work. Employers are required to complete and retain a Form I-9 for each individual they hire. In fiscal year 2012, HSI conducted 151 worksite audits in San Diego and Imperial counties, compared to 86 audits the previous year and 63 audits in fiscal year 2010.

"Employers who build their business model upon an illegal workforce will be held accountable," said Derek Benner, special agent in charge for HSI San Diego. "We encourage employers to take the employee verification process seriously. Employers must understand that the integrity of their employment records is just as important to the federal government as the integrity of their tax files or banking records."

Below, in alphabetical order, is a list of the businesses in San Diego and Imperial counties that received final fine notices from ICE in fiscal year 2012:

·                             Aquarius Yacht Services – $13,744 fine

·                             Balboa Ambulance Incorporated – $50,000 fine

·                             El Sol Meat Market – $24,050 fine

·                             Harmony Egg Ranch – $9,000 fine

·                             International Consolidated Cargo – $7,480 fine

·                             Mexicali Chicken and Salad – $21,500 fine

·                             Old Town Buffet – $15,000 fine

·                             Rocha Trucking & Parking Inc. – $8,000 fine

·                             Stanford Sign and Awning Inc. – $9,600 fine

·                             TDG Aerospace – $15,427.50 fine

The $173,800 in civil fines lodged against area San Diego-area companies in fiscal year 2012 represents an 18 percent increase over fiscal year 2011, when HSI imposed $146,577 in civil fines locally against 11 employers.

While HSI continues to pursue criminal cases against unscrupulous employers, it now places increased emphasis on gaining employers' compliance and outreach to the business community. As part of this effort, HSI utilizes all available civil and administrative tools, including Form I-9 inspections, civil fines and debarment. HSI also actively promotes the ICE Mutual Agreement between Government and Employers (IMAGE) outreach program. IMAGE is a voluntary partnership between the government and the private sector where employers receive invaluable training and are provided with additional tools to strengthen the integrity of their workforce and curtail the employment of unauthorized workers. There are currently 11 San Diego-area companies that are certified members of the IMAGE program.

Nationwide, HSI conducted more than 3,000 worksite audits in fiscal year 2012 as compared to 2,496 the previous year. In fiscal year 2012, the worksite audits and related investigations resulted in the issuance of 495 final fine notices totaling more than $12.4 million. That compares to 385 civil fines assessed in fiscal year 2011 totaling $16.3 million. 

Man Pleads Guilty to Identity Theft and Tax Evasion

A New Jersey man pleaded guilty Wednesday, January 30, 2013, in connection with his role in a large-scale identity-theft scheme. If convicted, he faces up to 52 years in prison. This case is being investigated by U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI), FBI, Internal Revenue Service's (IRS) Criminal Investigation and the Bergen County Prosecutor's Office.

Sang-Kyu Seo, 63, of Palisades Park, N.J., pleaded guilty to charges of conspiracy to unlawfully produce identification documents and false identification documents, aggravated identity theft, conspiracy to commit wire fraud, conspiracy to commit bank fraud and tax evasion.

According to court documents, Seo was the owner and operator of Hang Jin Yi Inc., doing business as Hwangini, a salon located in North Bergen, N.J., and Pier 7 Corporation, a purported small business located in Palisades Park.

Seo conspired with Sang-Hyun Park, aka Jimmy, and others, to obtain a Social Security number beginning with the prefix '586' for another individual. These 586 Social Security numbers were issued by the U.S. to individuals, usually from China, who were employed in American territories, such as Guam. Park is alleged to have been the leader of a criminal organization headquartered in Bergen County that obtained, brokered and sold identity documents to customers to commit credit card fraud, bank fraud, tax fraud and other crimes.

Park pleaded guilty Jan. 9 to his role in the enterprise, and is awaiting sentencing.

This criminal enterprise engaged in the fraudulent 'build-up' of credit scores associated with the Chinese identities. They did so by adding the Chinese identity as an authorized user to the credit card accounts of various co-conspirators - members of the enterprise's credit build-up teams who received a fee for this service. By attaching the Chinese identities to these existing credit card accounts, the teams increased the credit scores associated with the Chinese identities to between 700 and 800. The members of the build-up teams did not know the real person to whom the identity belonged or virtually any of the customers who had purchased the identities.

After building up the credit associated with these identities, Park and his co-conspirators directed, coached and assisted the customers in opening bank accounts and obtaining credit cards. Park and his co-conspirators then used these accounts and credit cards to commit fraud. Park relied on several collusive merchants who possessed credit card processing machines. For a fee, known as a 'kkang fee,' these collusive merchants charged the fraudulently obtained credit cards, although no transaction took place. After receiving the money into their merchant accounts from these fraudulent transactions, the collusive merchants gave the money to Park and his co-conspirators, minus their kkang fee.

Seo admitted that he obtained a 586 Social Security card and counterfeit driver's licenses through Park for a family member, who then used this identity to 'bust out' credit cards. Seo also admitted that he gave his corporate and personal credit cards to Park for the purpose of 'busting out' these maxed-out credit cards. In furtherance of this conspiracy, Park and his co-conspirators issued worthless checks, drawn on bank accounts that had been established using the 586 identities, as payment toward the balances on Seo's credit cards.

Before the banks and credit card companies realized that these checks were bogus, Park and his co-conspirators charged Seo's credit cards through collusive merchants or used them to purchase merchandise.

Seo also admitted that in 2007, with the assistance of a loan broker, he fraudulently obtained a $100,000 commercial loan on behalf of Pier 7. Seo admitted that he and the loan broker made false statements to obtain the loan including falsely representing that his businesses annual revenue was about $620,000.

Finally, Seo admitted that he committed tax evasion by issuing checks to himself and others, representing income derived through the operation of Hwangini, and then failing to report this income on his personal tax returns.

Seo admitted that in April 2008, he filed an individual income tax return for tax year 2007. This return declared that his taxable income for calendar year 2007 was about $197, and the amount of tax due and owing was about $19. Seo admitted that this return failed to include $304,848 in additional taxable income that he had received in 2007, thus having an additional tax of $81,643 due to the United States government.

Seo's sentencing is scheduled for May 14.

Iowa Child Predator Sentenced

An Iowa man was sentenced Thursday, January 31, 2013, to 20 years in federal prison followed by a lifetime of supervised release after he pleaded guilty to two counts of receiving images of child pornography and transmitting obscene material to a minor under the age of 16 years old. 

The sentence resulted from an investigation by U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI) and the Jupiter Police Department.

According to court documents, Eric Runyan, 31, of Earlham, Iowa, used an online social networking application to contact and initiate a chat with a 9-year-old girl in Jupiter, Fla.

Runyan, using his screen name Hard_n_big2000, asked the victim, "How old u?"
The 9-year-old immediately responded, "10 … Leave me alone."

Runyan continued to chat with the victim and sent the child a picture of his genitals. He then proceeded to ask the 9-year-old to take and transmit sexually explicit images of herself, which she did. When the 9-year-old tried to end the conversation, Runyan sent her threatening text messages, saying that he would ruin the 9-year-old's iPhone. He also threatened to find and kill her.

When the 9-year-old reported the incident to her parents, Jupiter Police Department detectives and HSI special agents were able to determine that the communications originated from Runyan's home.

Runyan was arrested and confessed to his involvement in the crime. He stated that he used his iPod Touch to communicate with the 9-year-old victim, transmit the images of himself to her and receive the sexually explicit images of the child.

This investigation was part of Operation Predator, a nationwide HSI initiative to protect children from sexual predators, including those who travel overseas for sex with minors, Internet child pornographers, criminal alien sex offenders and child sex traffickers. HSI encourages the public to report suspected child predators and any suspicious activity through its toll-free hotline at 1-866-347-2423 or by completing its online tip form. Both are staffed around the clock by investigators.

Suspected child sexual exploitation or missing children may be reported to the National Center for Missing & Exploited Children, an Operation Predator partner, via its toll-free 24-hour hotline, 1-800-843-5678.

HSI is a founding member and current chair of the Virtual Global Taskforce, an international alliance of law enforcement agencies and private industry sector partners working together to prevent and deter online child sexual abuse.

Texas Resident Extradited from Mexico for Defense Articles Smuggling

An Eagle Pass, Texas, man appeared Monday, February 4, 2013, in San Antonio federal court following his extradition from Mexico Friday, February 1, 2013, on federal charges of smuggling prohibited defense articles.

This extradition and criminal charges were announced by U.S. Attorney Robert Pitman, Western District of Texas, and Deputy Special Agent in Charge Monica Mapel, U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI) San Antonio.

A federal grand jury in Del Rio returned an indictment in June 2012 against Erik Alan Garza, 25, on six counts of aiding and abetting smuggling goods from the United States. According to the indictment, on various occasions between June 19, 2010 and Feb. 17, 2012, Garza and an accomplice, Rolando Tamayo, 32, also of Eagle Pass, illegally attempted to smuggle defense articles into Mexico from the United States.

These defense items included: night-vision monocular goggles, a thermal goggle, 400 sets of AR-15 front and rear flip-up tactical sights, about 5,000 high-capacity assault rifle magazines, and about 6,000 rounds of ammunition, including 100 rounds of .50-caliber ammunition.

The indictment also charges Tamayo, who remains a fugitive, with two counts of aiding and abetting the smuggling of goods from the United States. Each charge calls for a maximum sentence of 10 years in federal prison upon conviction.

"Gun and drug trafficking fuels violence by criminal organizations, and threatens the security of the people along our borders and throughout the country," said Mapel. "HSI special agents will continue to work jointly with our law enforcement partners to utilize our expertise in import and export enforcement to help keep our citizens safe and secure."

This case was investigated by special agents with HSI, and the Bureau of Alcohol, Tobacco, Firearms and Explosives. The Department of Justice Office of International Affairs, and the U.S. Marshals Service assisted with Garza's extradition.

An indictment is merely a charge, and should not be considered as evidence of guilt. The defendants are presumed innocent until proven guilty in a court of law.

Assistant U.S. Attorney Michael Galdo, Western District of Texas, prosecuted the case. 

Vietnamese Illegal Alien Pleads Guilty to Credit Card Fraud Conspiracy

Tri Tran, aka Tony, 35, a citizen of Vietnam unlawfully in the country and residing in Maryland, pleaded guilty Friday, February 1, 2013, to mail fraud in connection with a scheme to skim credit card account data and re-encode the data onto different credit cards used to buy merchandise at retail stores. As a result of the scheme, more than 50 victims incurred losses totaling more than $70,000.

The guilty plea follows an investigation by U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI) Baltimore; U.S. Secret Service, Baltimore Field Office; Harford County Sheriff's Office and the assistance of the Harford County State's Attorney Office.

According to his plea, beginning in 2009 through Feb. 28, 2011, co-conspirator Nghia Nguyen, 35, a Vietnamese citizen residing in Santa Ana, Calif., mailed an electronic skimming device to Tran in Maryland, who used the device at the business where he was employed to access data from customer credit cards. During 2009, Tran mailed Nguyen the skimming device approximately twice a month, typically when the data of five to 15 credit cards were stored on the skimmer. This pace picked up slightly in 2010 and in 2011 there were about four or five exchanges prior to his arrest. Tran would also mail several credit cards bearing his name to Nguyen.

Nguyen would then extract the data from the skimmer and re-encode the magnetic strip of the other cards with the victims' data. Nguyen would then send Tran three or four re-encoded cards in return, and Tran would use these cards, typically for one or two transactions at about $200 per transaction before the accounts were shut down. This process was repeated several times over the course of the scheme.

On Jan. 14, 2011, the Harford County Sheriff's Office began investigating a complaint related to credit card skimming activity at the retail location where Tran worked. On Feb. 28, 2011, Tran's residence was searched and HSI special agents seized computer equipment and peripheral devices used in the creation of the fraudulent credit cards.

Tran faces a maximum sentence of 20 years in prison and a $250,000 fine for mail fraud at his May 24 sentencing before U.S. District Judge James K. Bredar.

Nguyen previously pleaded guilty to his participation in the scheme and was sentenced Dec. 17, 2012, to six years in prison.

Today's announcement is part of efforts underway by President Obama's Financial Fraud Enforcement Task Force, which was created November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys' offices and state and local partners, it's the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. 

Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.

HSI Orange County, the Drug Enforcement Administration and U.S. Postal Inspection Service in California, City of Orange Police Department, Costa Mesa Police Department and the U.S. Attorney's Office for the Central District of California assisted in the investigation.

The case is being prosecuted by Judson T. Mihok.

Virginia Korean Gang Leader Sentenced to 210 Months for Extortion, Violence, and Organized Crime

Han Sa Yu, 44, a resident of Maryland who is originally from South Korea, was sentenced Friday, February 1, 2013, to 210 months in prison, followed by three years of supervised release, for extorting Korean businesses operating in Annandale, Va. Yu also agreed to pay more than $98,000 in restitution to the victims of his extortion. The case was investigated by U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI) Washington, D.C. and assisted by the Fairfax County Police Department.

Yu pleaded guilty to conspiracy to commit extortion on Nov. 9, 2012, and was sentenced Friday, February 1, 2013. Yu founded the Korean Night Breeders (KNB) to carry out extortions of various businesses in Annandale. The KNB targeted businesses owned by persons of Korean descent and frequently sought out businesses that employed illegal aliens.

"HSI (Washington, D.C.) is committed to working with our law enforcement partners to combat violent gangs who prey upon those in our communities," said Special Agent In Charge John P. Torres. "Today's sentencing of Yu sends a message that extortion, especially under the threat of violence, will not be tolerated. HSI (Washington, D.C.) will continue to identify, investigate and dismantle gangs who are a threat to public safety."

The KNB also sought out Korean taxi drivers, karaoke bars, restaurants and billiard halls to extort cash. Many business owners were assaulted and others threatened in an effort to instill fear in their victims.

The gang members frequently would dress in black suits, which became their recognized uniform. They would surround an extortion victim to further instill fear and implicitly threaten victims. From one victim alone KNB extorted more than $30,000. Various restaurants in Annandale either paid extortion or provided free food and drink to the gang.

Yu, also known as "Thunder" and "Bungay," modeled the gang after Asian organized crime syndicates. He sometimes would hold weekly meetings where the gang would discuss potential victims, and Yu would teach fighting techniques and his extortion protocol. The size of the gang varied over time, but at times had 15 or more members. Yu and his gang used the extortion proceeds to purchase marijuana and cocaine, among other things.

Assistant U.S. Attorney Michael J. Frank and Special Assistant U.S. Attorney Marc J. Birnbaum prosecuted the case on behalf of the United States.

This investigation was part of HSI's Operation Community Shield initiative. Operation Community Shield partners with existing federal, state and local anti-gang efforts to identify violent street gangs and develop intelligence on gang members and associates, gang criminal activities and international movements to arrest, prosecute, imprison and, or deport transnational gang members. HSI's National Gang Unit's goal is to deter, disrupt and dismantle gang operations by tracing and seizing cash, weapons and other assets derived from criminal activities.

Since the inception of Operation Community Shield in February 2005, HSI special agents working in conjunction with federal, state and local law enforcement agencies nationwide have arrested more than 29,366 street gang members and associates linked to more than 2,300 different gangs. At least 40 percent of those arrested had a violent criminal history. More than 374 of those arrested were gang leaders. Through this initiative nationally, HSI has seized 4,137 firearms. 

Puerto Rican National Sentenced for Distributing Counterfeit Pharmaceuticals

A Puerto Rican man was sentenced Monday, January 28, 2013, to two years in federal prison for being a key member of an organization that distributed large quantities of Chinese-made, counterfeit pharmaceuticals across the United States.

Francis Ortiz Gonzalez, 36, was sentenced the morning of Monday, January 28, 2013, by U.S. District Judge George H. Wu, who also ordered the defendant to pay $324,530 in restitution to the pharmaceutical companies that manufacture brand name products such as Lipitor, Viagra, Xanax and Cialis.

The case is the result of investigations by U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI); the Food and Drug Administration, Office of Criminal Investigations; and the U.S. Postal Inspection Service.

In September 2009, federal agents executed a search warrant at Ortiz Gonzalez's residence in Trujillo Alto, a suburb of San Juan, Puerto Rico. Inside the home, investigators found more than 100,000 pills that resembled a variety of popular prescription medications made by companies such as Pfizer Inc. and Eli Lilly and Company. Investigators found evidence that Ortiz Gonzalez obtained the counterfeit pills from China and had shipped more than 140,000 of them to individuals throughout the United States. If the drugs had been authentic, the retail value of the pills Ortiz Gonzalez possessed in his home and shipped would be more than $1 million.

Following a six-day trial last summer, Ortiz Gonzalez was convicted on one count of conspiracy and seven counts of trafficking in counterfeit pharmaceuticals. Ortiz Gonzalez was acquitted on three charges. His wife, Ideliz Aleman-Valentin, was acquitted on all charges.

Ortiz Gonzalez packaged and shipped more than 140,000 counterfeit tablets during a seven-month period in 2009 while working as a "dropshipper" for a counterfeit drug ring allegedly headed by Bo Jiang, 34, a Chinese national whose last known residence was in New Zealand. In January 2011, Jiang was taken into custody on a provisional arrest warrant by New Zealand law enforcement authorities, but he fled shortly after being released on bond. Jiang remains a fugitive.
In a related case before Judge Wu, a North Hollywood man was found guilty on January 11 of federal charges involving the trafficking of counterfeit pharmaceuticals.

Edward Alarcon, 44, was convicted of two counts of trafficking in counterfeit OxyContin and Cialis; he was acquitted on two other counts. The evidence presented during a three-day jury trial showed that Alarcon had purchased the counterfeit OxyContin from Bo Jiang, the same man who allegedly supplied Ortiz Gonzalez.

On Nov. 10, 2009, HSI special agents found approximately 237 counterfeit OxyContin pills and approximately 1,592 counterfeit Cialis pills in Alarcon's car and house. Investigators also found hundreds of other counterfeit pills, including Viagra and Levitra. Only a month before the federal search, Alarcon had been convicted in state court on counterfeit drug charges for selling counterfeit Cialis to an undercover Los Angeles Police Department officer in 2008.

Alarcon is scheduled to be sentenced by Judge Wu April 4. At that time, Alarcon faces a statutory maximum sentence of 20 years in federal prison.

California Men Charged with Wire Fraud and Bribery

Federal prosecutors filed criminal charges Monday, January 28, 2013, against the CEO of an Orange County electronic components company who paid kickbacks for years to ensure contracts for his firm, and against an official with Panasonic's American subsidiary who accepted the bribes.

The two men charged Monday, January 28, 2013, with "honest services" wire fraud are William McMahon, 47, of Norco, the CEO and co-owner of Trustin Technology, and Sean Volin, 38, of Oakland, New Jersey, a manager with Panasonic Corporation of North America in Secaucus, New Jersey.

In addition to criminal informations filed in U.S. District Court, prosecutors filed plea agreements in which both men admitted their criminal conduct and agreed to cooperate in the ongoing probe conducted by U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI) and the FBI.

According to court documents, for the past decade, Trustin sold RAM modules and hard drives to Panasonic – Trustin's largest and most important customer – for use in at least one line of laptop computers.

Approximately 10 years ago, Volin approached the then-CEO of Trustin to discuss a price reduction for hard drives Trustin was supplying to Panasonic. In response, the then-CEO proposed a kickback scheme in which Panasonic would continue to pay the same price for hard drives, but Trustin would give Volin half of the proposed price reduction for each unit sold. 

Volin "agreed with the former CEO's proposal, did not obtain a price reduction for Panasonic, and a stream of illicit payments between Trustin and Volin began," according to Volin's plea agreement.

McMahon became CEO of Trustin in 2005, and he learned of the kickback arrangement that had already paid more than $100,000 to Volin. The payments stopped under McMahon's watch for a period of time, but resumed as McMahon's relationship with Volin developed. Instead of paying a kickback for each hard drive sold to Panasonic, McMahon made regular payments in exchange for Volin "looking out for Trustin's interests and as a reward for his prior assistance to Trustin," according to Volin's plea agreement.

From November 2005 through the end of 2011, McMahon oversaw payments of more than $555,000 that went to a company Volin had established to accept the illicit payments from Trustin. In total, Volin was paid more than $664,900 by Trustin. Volin and McMahon also admitted in the court documents that Volin received other benefits, including trips to the Kentucky Derby and Napa Valley.

"In exchange for this stream of payments, and acting with the intent to defraud Panasonic of Volin's duty of honest services, Volin continued to assist Trustin in obtaining additional business from Panasonic, resulting in Panasonic's designating Trustin a 'master vendor,' according to court documents, which say that as a result of the scheme "Trustin was able to obtain tens of millions of dollars of business from Panasonic."

McMahon and Volin will be summoned to appear in federal court in Orange County in February. The wire fraud charge alleged in the two cases filed Monday, January 28, 2013, carries a statutory maximum penalty of 20 years in federal prison.

Panasonic Corporation of North America fully cooperated with the government's investigation.

ICE and CBP's "Operation Red Zone" Seizes $13.6 Million Worth of Counterfeit NFL Merchandise

Speaking at a National Football League (NFL) news conference Thursday, January 31, 2013, U.S. Immigration and Customs Enforcement (ICE) Director John Morton and NFL Vice President for Legal Affairs Anastasia Danias announced the record-breaking results of a nationwide enforcement operation. The initiative, dubbed 'Operation Red Zone,' commenced Sept. 1, 2012, and targeted international shipments of counterfeit merchandise as it entered the United States. Authorities targeted warehouses, stores, flea markets, online vendors and street vendors selling counterfeit game-related sportswear and tickets throughout the country.

Fake jerseys, ball caps, T-shirts, jackets and other souvenirs are among the counterfeit merchandise and clothing confiscated by teams of special agents and officers from ICE's Homeland Security Investigations (HSI), U.S. Customs and Border Protection (CBP), U.S. Postal Inspection Service, and state and local police departments around the country - all in partnership with the NFL and other major sports leagues.

"The Super Bowl is one of the nation's most exciting events. Organized criminals are preying on that excitement, ripping consumers off with counterfeit merchandise and stealing from the American businesses who have worked hard to build a trusted brand," said Morton. "The sale of counterfeit jerseys and other sports items undermines the legitimate economy, takes jobs away from Americans and fuels crime overseas. No good comes of counterfeiting American products - whether NFL jerseys, airbags, or pharmaceuticals - and we must go after the criminals behind it."

'Hard goods' seizures

Special agents from HSI and officers with CBP operated in multiple teams with the NFL and law enforcement agencies throughout the nation to identify illegal shipments imported into the U.S., as well as stores and vendors selling counterfeit trademarked items. With only days left before Super Bowl XLVII, these teams have already seized more than 160,000 items of phony Super Bowl-related memorabilia along with other counterfeit items for a total take of more than $13.6 million. Due to the increased activity of counterfeiting operations around the world, this year the operation began Sept. 1, 2012, and will continue through Feb. 6, 2013.

"We're delighted to once again partner with federal law enforcement to help combat the influx of counterfeit merchandise," said Danias. "We are grateful for their tireless efforts to keep counterfeiters from illegally profiting off of the fans' enthusiasm for their team and the Super Bowl and from hurting the local businesses that play by the rules."

"In collaboration with the NFL and our (Department of Homeland Security) partners, we are providing critical support in the effort to protect consumers from counterfeit goods," said Robert C. Gomez, director of field operations in Atlanta and New Orleans for CBP. "The enforcement of iintellectual property rights is a national agency priority, and our CBP officers and import specialists are actively working to intercept these products. Counterfeit merchandise hurts our economy and, in many cases, presents safety issues. It is a potential source of funding illegal activities that present a threat to our national security."

Arrests

In September 2012, HSI Boston - assisted by HSI Providence - executed a search warrant at a residence in Warwick, R.I. HSI seized 226 boxes of counterfeit goods containing 4,016 sports jerseys with a manufacturer's suggested retail price (MSRP) of $724,340 and approximately $477,000 worth of additional counterfeit goods, as well as $130,057 in U.S. currency and checks. The owner of the home was subsequently arrested and is currently facing federal charges of trafficking in counterfeit goods and smuggling.

In November 2012, HSI Indianapolis special agents responded to a call from Indiana State Fairgrounds Security that an individual at the Indianapolis International Fest was selling items suspected to be counterfeit. Upon arriving at the festival, the special agents were able to verify the goods to be counterfeit and seized 1,319 counterfeit sports ball caps from the individual with an MSRP of $30,095 and approximately $7,600 worth of additional counterfeit goods. HSI arrested the man for illegally trafficking in counterfeit merchandise. 

Twenty-one other individuals were arrested in partnership with state and local law enforcement
agencies on state charges at locations around the country.

Website seizures

Furthering HSI's efforts to combat the international counterfeiting supply chain and piracy online, special agents seized a total of 313 websites identified to be selling counterfeit merchandise.

The website seizures during Operation Red Zone are the next iteration of Operation In Our Sites, a long term law enforcement initiative targeting counterfeiting and piracy on the Internet. The 313 websites have been seized by law enforcement, and are now in the custody of the federal government. Visitors to these websites will find a seizure banner that notifies them that the domain name has been seized by federal authorities and educates them that willful copyright infringement is a federal crime. Since the launch of Operation In Our Sites in June 2010, the ICE HSI-led Intellectual Property Rights (IPR) Center has seized a total of 2,061 domain names.

HSI has continued to work closely with payment processor PayPal to identify bank accounts being used to facilitate the transfer of money to these illegal operations. To date, PayPal and HSI have identified and seized more than $66,000 in assets in these accounts.

"PayPal and eBay Inc. pride ourselves in going above and beyond in the fight against the illegal online trafficking of counterfeit goods by partnering with law enforcement and rights owners globally, and as part of providing safe and trusted payments and commerce platforms," said Tod Cohen, eBay's vice president and deputy general counsel of government relations.

Operation Red Zone continues

Operation Red Zone will continue this weekend at the Super Bowl, throughout the New Orleans-area and around the nation.

The operation was spearheaded by the IPR Center in coordination with the Department of Justice's Computer Crime and Intellectual Property Section and five U.S. Attorneys' Offices, including the District of Maryland, District of New Jersey, District of Colorado, Eastern District of Louisiana and the District of Utah.

The IPR Center is one of the U.S. government's key weapons in the fight against criminal counterfeiting and piracy. Working in close coordination with the Department of Justice Task Force on Intellectual Property, the IPR Center uses the expertise of its 21 member agencies to share information, develop initiatives, coordinate enforcement actions and conduct investigations related to intellectual property theft. Through this strategic interagency partnership, the IPR Center protects the public's health and safety and the U.S. economy.