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U.S. Attorney’s Office for the Middle District of Pennsylvania Newsletter Issue 4 - October 2012 Inside this issue: Message from the U.S. Attorney – page 1, Equitable Sharing Program - page 2, National Missing Children’s Awareness Day – page 2, Recent Noteworthy Cases – pages 3-5, Employee Spotlight – page 6, MDPA Map and Office Information – page 7 Picture of September 12, 2012 press conference at the Hazleton, PA, State Police field office with state, local, and federal law enforcement and prosecutors to announce indictment in a multi-county armed bank robbery case. A Message from the U.S. Attorney In this edition of our district’s newsletter, we are highlighting the Department of Justice’s Equitable Sharing Program. As explained in more detail inside, the Equitable Sharing Program operates such that federal, state, and local law enforcement partners are able to share in the assets that are forfeited as the result of a successful criminal investigation in which multiple agencies participated. In recent years, the Pennsylvania State Police, as well as 28 local law enforcement agencies have received funds through the Equitable Sharing Program. We are also shining a spotlight on our office’s partnership with the U.S. Department of Homeland Security that has provided one Special Assistant United States Attorney (SAUSA) committed to prosecuting immigration fraud cases, a collaboration that has resulted in the prosecution of 60 criminal immigration fraud cases in the past two years, and the outstanding efforts of two prosecutors in our Scranton office in cases involving crimes against children and child pornography. Should you have any questions about these programs, or other matters, please do not hesitate to contact our office. Peter J. Smith Page 2 Asset forfeiture has become one of the most powerful tools to combat and dismantle criminal enterprises by removing the proceeds and instrumentalities of the crime. The Equitable Sharing Program enhances cooperation among federal, state, and local law enforcement agencies by sharing a portion of these proceeds with our state and local partners in direct relation with their participation to the total law enforcement effort resulting in forfeiture. The Equitable Sharing Program was created in 1984, and continues to grow with more than 8,000 participating state and local law enforcement agencies nationwide. Agencies use forfeited funds and property recovered from criminals to strengthen local law enforcement operations and to reduce the fiscal burden that would otherwise fall on local taxpayers. Funds distributed through the Equitable Sharing Program enable agencies to make communities safer through the purchase of valuable resources, such as equipment, training, and drug education and awareness. As the Program grows, it is imperative that agencies not lose sight of the importance of maintaining transparency, integrity, and account-ability in investigations and thereafter when promoting participation in the Equitable Sharing Program. The Middle District is a robust participant in the Equitable Sharing Program. In FY12, 49 law enforcement partners shared almost $2.2 million. For more information on participating in the Equitable Sharing Program, please see the Guide to Equitable Sharing for State and Local Law Enforcement Agencies. An electronic copy of the publication is available at the following address: http://www.justice.gov/criminal/afmls/pubs/pdf/04-2009guide-equit.pdf. If there are any questions, please contact Jim Clancy, Chief, Victims Rights and Asset Recovery Unit, at (717) 221-4482. National Missing Children’s Awareness Day: On July 25, in coordination with federal, state and local law enforcement partners from the FBI, US Postal Inspection Service, ICE, US Marshals, Pennsylvania State Police, Harrisburg City Police Department, and the York County Missing Children’s Task Force held a safety awareness event at the Senator’s Baseball game in Harrisburg to recognize National Missing Children’s Awareness Day. Free fingerprinting and safety materials were provided. Page 3 Recent Noteworthy Cases Recent Noteworthy Cases U.S. v. Nagle In April, Joseph Nagle, the former President and owner of Schuykill Products was convicted after a four-week jury trial in Harrisburg. The jury returned a verdict of guilty on 26 of 30 charges in the indictment including conspiracy to defraud the United States Department of Transportation (USDOT) and commit wire and mail fraud, 7 counts of wire fraud, 6 counts of mail fraud, conspiracy to commit money laundering and 11 counts of money laundering. Nagle and other executives at SPI diverted over 300 PennDOT and SEPTA construction contracts to SPI and CDS that were reserved for DBE's. Nagle and his co-conspirators executed the scheme by using a small Connecticut highway construction firm known as Marikina Construction Corporation as a front company to obtain these lucrative government contracts. This scheme lasted over 15 years and involved over $136 million in government contracts and is the largest reported Disadvantaged Business Enterprise (DBE) fraud in the nation's history. The investigation was conducted by the FBI, the U.S. Department of Transportation Inspector General's Office, the U.S. Department of Labor Inspector General's Office, and the Criminal Investigation Division of the IRS. Senior Litigation Counsel Bruce Brandler and Assistant United States Attorney Kim Douglas Daniel handled the prosecution. U.S. v. Jackson In July, Cameron Jackson, a/k/a “Cam,” formerly of Taylor, Pennsylvania, was sentenced to 151 months’ imprisonment for possession with intent to distribute cocaine, crack cocaine and heroin. An investigation conducted by the Scranton Police Department regarding the sale of illegal drugs culminated in a search warrant being served on Jackson’s residence. Drug paraphernalia, illegal drugs and drug proceeds were recovered during the execution of the search warrant. In addition to the items found during the search warrant of Jackson’s residence, police were able to make multiple controlled purchases of crack cocaine from Jackson during transactions that occurred in Scranton, Pennsylvania. The investigation was conducted by the Scranton Police Department together with Immigration and Customs Enforcement and the FBI in a joint alien gang task force which is investigating illegal alien street gang activity in Northeastern Pennsylvania. The case is assigned to Assistant United States Attorney Todd K. Hinkley. Page 4 U.S. v. Strausbaugh A New Oxford couple was sentenced on May 8 in federal court. Michael Strausbaugh, was sentenced to 45 years in prison, $3,500 fine and a lifetime of supervised release. Rebecca Strausbaugh, was sentenced to 15 years in prison, $1,200 fine and five years of supervised release. In March 2011, Michael Strausbaugh, and his wife, Rebecca Strausbaugh, were both charged with producing images depicting the sexual abuse of a child between the age of 5-8 months. Michael Strausbaugh was also charged with distribution and possession of child pornography. Testimony at trial established that Michael Strausbaugh, aided by his wife, engaged in sexually explicit conduct with an infant in their care for the purpose of producing photos. Michael Strausbaugh then distributed these images over the internet. This case was investigated by the U.S. Postal Inspection Service, Federal Bureau of Investigation, U.S. Department of Homeland Security Investigations, and the Pennsylvania State Police-Mobile Computer Crime Lab. Prosecution was handled by Assistant United States Attorney Daryl F. Bloom. U.S. v. Brosnac Andrew Brosnac, age 47, of Keller, Texas was indicted in August on charges that between 2006 and 2008 Brosnac, and co-conspirator Samuel Pearson, age 47, Hanover, York County, Pennsylvania, allegedly used a group of companies to buy Jiffy Lube stores, automotive service businesses, convenience store/gas stations and other commercial properties and then sell them to investors. Brosnac, a real estate broker and investment consultant, allegedly defrauding investors and lenders out of approximately $16 million in connection with the sale and leaseback of businesses in Pennsylvania, New York, North Carolina, and Wyoming. According to the indictment, the commercial properties involved in the fraud were located in Sayre, Erie, and Bethel, Pennsylvania, Syracuse and Canandaigua, New York, Mars Hill, North Carolina and Sheridan, Wyoming. Financing and commercial loans were allegedly obtained from Indiana First Savings Bank, Bank of the West, California Credit Union, Travis Credit Union and Great Lakes Credit Union. If convicted, Brosnac faces an estimated advisory imprisonment range of 11 to 14 years, plus fines and an order to make restitution. The case was investigated by the Federal Bureau of Investigation. Prosecution is assigned to Assistant U.S. Attorney George J. Rocktashel. Page 5 U.S. v. Reid Jamarr Reid, of Wilkes-Barre, Pennsylvania was sentenced to a 21- month term of imprisonment and ordered to forfeit $208,416.50 as a result of his involvement in a 17-person drug ring that operated in Wilkes- Barre. The members of the drug trafficking ring imported crack, cocaine and marijuana into Wilkes-Barre, Pennsylvania, from multiple locations outside the Commonwealth. The investigation, named “Operation Southern Comfort” was conducted by the United States Drug Enforcement Administration, the Internal Revenue Service, the Pennsylvania Attorney General’s Office, the Pennsylvania State Police, the Wilkes-Barre Police Department, and the Kingston Police Department. Prosecution of this case was handled by Assistant United States Attorney Todd K. Hinkley. U.S. v. Pennsylvania Department of Corrections (PDOC) On July 9, the Justice Department announced that it reached a settlement in its lawsuit against the Pennsylvania Department of Corrections (PDOC). The settlement, filed with the U.S. District Court for the Middle District of Pennsylvania, resolves allegations that PDOC violated the reemployment rights of U.S. Army Reservist David C. Fyock, of Kennerdell, PA, under the Uniformed Services Employment and Reemployment Rights Act (USERRA). The department’s complaint, which was filed on Oct. 27, 2011, alleges PDOC violated USERRA by failing to retroactively promote Fyock from a corrections officer 1 to a corrections officer 2 position at the State Correctional Institution Mercer in Mercer, Pa., based on his successful performance on a make-up promotional examination after returning from a military deployment. According to the complaint, Fyock’s score on the make-up examination was higher than the score of any person promoted to any of the 13 vacant corrections officer 2 positions filled based on the May 2007 promotional test he missed. Under the terms of the settlement, Fyock will receive a promotion to corrections officer 2 (sergeant), as well as back pay and other benefits. This matter was litigated by Assistant U.S. Attorneys Melissa Swauger and Timothy Judge of the Civil Division of the U.S. Attorney’s Office for the Middle District of Pennsylvania in collaboration with attorneys from the Justice Department’s Civil Rights Division. The case stems from a referral from the U.S. Labor Department's Veterans' Employment and Training Service. Page 6 Employee Spotlight Photo of Alice Song Hartye and Brian McDonnell. Two years ago, the U.S. Attorney’s Office announced the partnership with the U.S. Department of Homeland Security, Immigration and Customs Enforcement (ICE) to provide a federal prosecutor dedicated to prosecute any case related to immigration fraud. As the office said farewell to Brian McDonnell in August 2012 following his two-year appointment, the office announced its efforts to continue the partnership by welcoming Alice Song Hartye. Alice has extensive knowledge of immigration law having clerked with the United States Department of Justice, Executive Office for Immigration Review in El Paso and Dallas, Texas, and with her position with ICE as an Assistant Chief Counsel in Phoenix, Arizona and York, PA. For further information concerning prosecution of suspected immigration fraud cases, please contact our Harrisburg office at (717) 221-4482. Congratulations! July 2012 - Plaques were issued by the U.S. Immigration and Customs Enforcement Homeland Security Investigations to Assistant U.S. Attorneys’ Francis P. Sempa and Michelle Olshefski in recognition and appreciation of their outstanding dedication, professionalism and significant contributions to Homeland Security Investigations. Mr. Sempa and Ms. Olshefski have spearheaded the Scranton office’s prosecutions of crimes against children, child pornography, and crimes against the elderly in close cooperation with state and local law enforcement agencies in northeastern Pennsylvania. Page 7 Visit our website at: http://www.justice.gov/usao/pam/index.html Our Offices: William J. Nealon Federal Building and Courthouse 235 N. Washington Ave., Suite 311 Scranton, PA 18503 Toll-Free (866) 996-4320 Phone (570) 348-2800 Fax (570) 348-2807 Ronald Reagan Federal Building and Courthouse 228 Walnut Street, Suite 220 P.O. Box 11754 Harrisburg, PA 17108-1754 Toll-Free (866) 673-7340 Phone (717) 221-4482 Fax (717) 221-4493 Herman T. Schneebeli Federal Building 240 West Third Street Williamsport, PA 17701-6465 Phone (570) 326-1935 Fax (570) 326-7916
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