February 2011 Archives

Immigration and Customs Enforcement Targets Child Pornography and Sexual Predators

February 23, 2011, by The McKellar Law Firm, PLLC

Persons accused of child pornography or sexual abuse of minors charges typically deal with the FBI or with local police agencies and task forces. However, the Denver Post has an interesting article about the increased role that U.S. Immigration and Customs Enforcement (ICE) is taking in the pursuit of sex criminals.

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According to the Denver Post article, ICE is the largest investigative arm under the Department of Homeland Security, and fighting child pornography, child sexual tourism and trafficking of children is one of ICE's top priorities. "We are working around the globe -- and the violators know no border -- and it is incumbent on us to be nimble from a law enforcement perspective," said David Marwell, Denver's acting special agent in charge.

Similar to local investigating authorities, ICE agents work undercover on peer-to-peer networks on the Internet to track down child pornography and work with local and global partners on capturing the producers of the images. The article reports, "And while many federal, state and local law enforcement agencies are investigating the child-porn problem, ICE has specific statutes it can enforce and a presence around the world with 69 offices in 49 countries."

The ICE website discusses one particularly successful investigation called "Operation Falcon, which" identified 39 websites distributing child pornography and led to the arrest of 1,200 international downloaders and more than 300 U.S. customers. Nine individuals from the United States and Belarus were identified and charged as the principals in this investigation. All principals were convicted on various charges related to money laundering, as well as the production and distribution of child pornography.

It's clear that the Government is not limited by its borders in pursuit of alleged sexual criminals. As the world grows smaller, the reach of investigating authorities grows larger.


Sixth Circuit Rules That Knowledge is a Required Element of Receiving Child Pornography

February 21, 2011, by The McKellar Law Firm, PLLC

Federal child pornography crimes can be very subtle in their distinction from one another, and these subtle differences can result in severe sentencing discrepancies. For instance, one such discrepancy occurs when analyzing the difference between receipt of child pornography (18 U.S.C. § 2252(a)(2)) and possession of child pornography (18 U.S.C. § 2252(a)(4)(b)). The former crime (receipt) requires a minimum 5-year statutory sentence, while the latter crime (possession) does not have a minimum statutory sentence.

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Another comparison that was addressed in United States v. Daniel Szymanski (6th Circuit, February 7, 2011), was whether the mental element of "knowledge" was required in order to convict someone of receipt of child pornography. In Szymanski, the Defendant pled guilty to receiving child pornography and received the minimum mandatory sentence of 5 years. The Defendant appealed his sentence on a number of grounds, but the Sixth Circuit, on its own initiative, overturned the sentencing court's decision because "a defendant charged with receipt of child pornography must have knowledge, not only as to the act of receipt itself, but also as to the fact that the material he is receiving features minors engaged in explicit sexual conduct."

The Sixth Circuit relied heavily on the U.S. Supreme Court case United States v. X-Citement Video, Inc., 513 U.S. 64 (1994), which previously addressed this issue and decided that knowledge was a required element of the crime of receipt of child pornography. The Sixth Circuit court wrote in reference to X-Citement Video:

In other words, the Supreme Court interpreted § 2252(a)(2) to mean that defendant convicted of receiving child pornography must have known, not just that he was receiving something, but that what he was receiving was child pornography.

The Court also succinctly pointed out a crucial difference between the crimes of receipt and possession of child pornography by writing:

But there is a difference between the two offenses, and it is one highlighted by the very Supreme Court case that no one in this proceeding ever explicitly mentioned: the prosecution must prove that the defendant knew at the time of receipt that the material he received featured underage subjects engaged in sexually explicit conduct. See Malik, 385 F.3d at 760 (noting that "the possession offense lacks [this] scienter requirement").

East Tennessee Couple Plead Guilty in Immigration Fraud Case

February 16, 2011, by The McKellar Law Firm, PLLC

Immigration fraud cases are not very common in this part of the country, but a couple from Greeneville, Tennessee, recently pleaded guilty to immigration fraud, among other crimes. According to an article by Jamie Satterfield in the Knoxville News Sentinel, an East Tennessee woman and her bodyguard entered guilty pleas earlier this week to defrauding illegal immigrants in Tennessee and North Carolina of nearly $100,000 via claims of expertise in getting them legal citizenship.

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On Monday, Debra Lynn Gouge and Jawad Lashin pleaded guilty before Greeneville U.S. District Judge Ronnie Greer to the following charges:

1. Wire Fraud [18 U.S.C. § 1343] 2. Concealment of Material Fact [42 U.S.C. § 408(a)(4)] 3. Fraud & False Statement Regarding a Tax Return [26 U.S.C. § 7601]

Plea documents indicate that the two defendants held themselves out to be immigration "specialists." Once unsuspecting immigrants paid for so-called immigration services, defendant Gouge would present her customers with documents to sign so that she could send the form to immigration officials to secure them legal citizenship. However, defendant Gouge failed to send in these forms.

The plea documents further indicate that "Gouge and (Lashin) never sent any immigration documents to any United States agencies. When customers questioned Gouge and (Lashin) about their status, Gouge and (Lashin) provided the customers false answers which were designed to stall their customers. In some instances, (Lashin) threatened customers with deportation."

Defendant Gouge also admitted to improperly receiving Social Security disability benefits while engaging in this immigration scam and also for failing to report her income to the IRS. Both defendants are set for a sentencing hearing on June 27th.


Tennessee Company and Citizens Indicted for Violation of Arms Export Control Act

February 10, 2011, by The McKellar Law Firm, PLLC

Earlier this week, five individuals and a Nashville firearms manufacturer were indicted by a federal grand jury on charges relating to international firearms and trafficking violations of the Arms Export Control Act (AECA), according to a press release from the U.S. Attorney's Office for the Middle District of Tennessee. As discussed in an earlier blog post, the AECA is set forth in 22 U.S.C. § 2778, and this law provides the federal government with authority to control the export of defense articles and services.

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In this particular case, the Government alleges that the defendants were part of a scheme which began in 2003 to thwart U.S. import/export restrictions on firearms and their components. Assistant Attorney General Lanny A. Breuer of the Department of Justice claims, "The defendants allegedly went to great lengths to conceal their activities and evade U.S. laws - mislabeling packages, falsifying shipping records, and maintaining a fictitious set of books and records, among other things. The illegal trade of firearms and their components poses serious risks and, as this case shows, we cannot and will not tolerate it."

The indictment alleges that each of the defendants conspired to intentionally violate the AECA by causing firearms components, which are listed as "defense articles" on the United States Munitions List, to be exported from the United States to an international location without first obtaining a license or written authorization for such export from the Directorate of Defense Trade Controls of the United States Department of State. According to the indictment, the export of "defense articles," such as firearms or firearms components or other military items on the US Munitions List, are strictly controlled by the AECA and the International Trafficking in Arms Regulations (ITAR).

At this point, each of the defendants will soon appear in U.S. District Court in Nashville, Tennessee, for their Initial Appearance and Arraignment. At that time, the Court will address issues of pre-trial release and scheduling of important dates such as trial, motion deadlines, and plea cutoff deadlines.

Bankruptcy Fraud Lands Iowa Couple in Jail

February 8, 2011, by The McKellar Law Firm, PLLC

Bankruptcy Fraud Attorneys are familiar with the law codified at 18 U.S.C. § 157, which sets forth the law concerning federal bankruptcy fraud. An Iowa couple, Gerald and Fay Schuerer, have also been forced to become familiar with this law as they were sentenced earlier this week to a combined 6 years in federal prison and nearly $400,000 in restitution for their role in a "complicated bankruptcy scheme."

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Prosecutors argued that the Schuerers made sham sales of assets, such as vehicles, jewelry and stocks, to relatives with an agreement that they would get receive their possessions back after going through bankruptcy. Prosecutors further claim that the Schuerers then claimed to move to Florida where bankruptcy exemptions are more liberal than in their home state of Iowa, filed for bankruptcy protection, and then returned to Iowa to retrieve their property.

The U.S. Attorney's Manual states:

Title 18 U.S.C. § 157 prohibits devising or intending to devise a scheme or artifice to defraud and, for purposes of executing or concealing the scheme either (1) filing a bankruptcy petition; (2) filing a document in a bankruptcy proceeding; or (3) making a false statement, claim, or promise (a) in relationship to a bankruptcy proceeding either before or after the filing of the petition; or (b) in relation to a proceeding falsely asserted to be pending under the Bankruptcy Code.

Bankruptcy fraud cases will vary from cases like the Scheurers to false filings, multiple filings, concealment of assets, and petition mills. The penalties for bankruptcy fraud are up to 5 years imprisonment, fines, and restitution. Additionally, bankruptcy fraud cases often are accompanied by tax evasion charges, wire and bank fraud charges, and mail fraud charges.

Strip Club Owner Receives Sentencing Break for Tax Crimes After Cooperating with Government

February 7, 2011, by The McKellar Law Firm, PLLC

After pleading guilty to tax crimes, A Chicago area strip club owner received a sentencing break after cooperating with the federal government. According to the Chicago Tribune, Michael Wellek entered guilty pleas to to impeding an Internal Revenue Service investigation and filing a false income tax return. Additionally, the government seized $12 million that Wellek had hid in duffel bags.

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Wellek's punishment pursuant to the federal sentencing guidelines called for a 4-year sentence, but the Court ordered Wellek to 1 year in prison followed by 6 months of home confinement due to "substantial assistance" that he provided to the government. A sentence below the advisory federal sentencing guidelines can occur under Section 5K1.1 of the U.S. Sentencing Guidelines, which provides:

Upon motion of the government stating that the defendant has provided substantial assistance in the investigation or prosecution of another person who has committed an offense, the court may depart from the guidelines. (a) The appropriate reduction shall be determined by the court for reasons stated that may include, but are not limited to, consideration of the following: (1) the court's evaluation of the significance and usefulness of the defendant's assistance, taking into consideration the government's evaluation of the assistance rendered; (2) the truthfulness, completeness, and reliability of any information or testimony provided by the defendant; (3) the nature and extent of the defendant's assistance; (4) any injury suffered, or any danger or risk of injury to the defendant or his family resulting from his assistance; (5) the timeliness of the defendant's assistance.

There are a few points to consider for defendants who are considering providing substantial assistance to the government. First, the government (and not the defendant) decides whether the assistance/information provided was "substantial." Accordingly, if a defendant provides information that is truthful but of little to no value, the defendant may not receive a motion for downward departure pursuant to Section 5K1.1 Second, the timeliness of a defendant's assistance is a consideration for both the sentencing court and the prosecution. As a result, a decision on whether to cooperate with the government may need to be made early in the process so as to yield the greatest advantage to the defendant. As always, consult an experienced federal criminal defense attorney prior to speaking with government agents or prosecutors.

An Overview of Public Corruption Crimes

February 3, 2011, by The McKellar Law Firm, PLLC

Tennessee public corruption attorneys will often deal with cases involving a breach of public trust and/or abuse of one's position by federal, state, or local officials. To put it simply, a government official may violate federal law when he/she asks, demands, solicits, accepts, or agrees to receive anything of value in return for being influenced in the performance of his/her official duties. Public corruption cases can include bribery, extortion, embezzlement, illegal kickbacks, tax evasion, and money laundering.

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The Federal Bureau of Investigation claims that public corruption cases are its "top priority." The FBI further claims that public corruption "impacts everything from how well our borders are secured and our neighborhoods protected...to verdicts handed down in courts...to the quality of our roads, schools, and other government services. And it takes a significant toll on our pocketbooks, wasting billions in tax dollars every year."

The Internal Revenue Service may also get involved in public corruption cases along with the FBI and local authorities. The IRS reports that it launched 88 public corruption investigations in 2010, with 61 of those cases resulting in indictments or informations. Of those 61 cases, 60 were convicted and 80% of those convicted were incarcerated. The average length of incarceration was 46 months.

Via an article on the FBI website, the agency claims to specifically be focusing on "corruption along our national borders; corrupt officials who take advantage of natural disasters or economic crises to divert some of the government's aid into their own pockets; and a myriad of officials who may personally benefit from the economic stimulus funding."