Military Fraudster Sentenced

The charity sounded like a worthy and patriotic cause—an organization that would send military families on Disney vacations and pay travel costs for families to see their loved ones graduate from boot camp in South Carolina and California.

But the charity, known as “Marines and Mickey” was simply a front that fraudster John Shannon Simpson used to enrich himself. Thanks to an FBI and Naval Criminal Investigative Service investigation, Simpson is now serving a prison sentence.

“Simpson presented himself as a retired master sergeant in the Marines, and people believed him. They had no reason to question a U.S. Marine,” said Special Agent Tiffany Baker, who investigated the case out of the FBI’s Bluffton Resident Agency, which is part of the Columbia Field Office.

In fact, Simpson was actually a lower-level rank than he claimed, and he was court-martialed for going AWOL.

But claiming to be associated with the Marine Corps gave Simpson credibility, and donors gave nearly half a million dollars to his charity from its founding in 2014 until 2016.

Simpson befriended a Gold Star mother who had lost her son in a shooting in Chattanooga, Tennessee in 2015. Simpson and the Gold Star mother collaborated on fundraisers for Marines and Mickey.

People who knew the mother became suspicious of Marines and Mickey and dug into Simpson’s military record. A friend of hers contacted the FBI, who began looking into the charity.

While the purported charity claimed that 100 percent of funds were directed to help military families, investigators found that less than 20 percent of the donations were actually used for that purpose. Most of the money was simply pocketed for Simpson’s daily living expenses.

“Simpson even hosted a fundraiser that was to send a Marine’s child who was sick with cancer to Disney,” Baker said. “In fact, he did not direct any money toward that family.”

But Simpson was a good salesman. He knew enough about the military to ingratiate himself with Marines and their families. And for a long time, no one, including his volunteers, had any reason to question his military record or how he was spending the money he raised.

“It’s such an affront to the Marine Corps values that someone had the audacity to take advantage of their service members for financial gain—while pretending to have those same military values himself when he did not,” Baker said. “It’s just a really egregious case.”

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Father and Son Sentenced for Fraud

An elderly man in a wheelchair lost more than $100,000. A woman lost her high-end home and moved into a small shed on her son’s property. Another victim lost her life savings and could not afford eyeglasses. Some victims declared bankruptcy.

These stories are just a few from the more than 100 victims who lost $63 million as a result of a fraud scheme carried out by the owners of Smith Advertising from around 2008 to 2012.

“This is not just a crime about money. These were people with real lives who were lied to and deceived, and they paid a real price,” said Special Agent Jay Stone, who investigated the case out of the FBI’s Tampa Field Office, along with the U.S. Secret Service.

Gary Todd Smith, and his father, Gary Truman Smith, ran Smith Advertising, a North Carolina-based company with offices in Florida. At first, the company did legitimate advertising work, but it hit a financial snag in the mid-2000s, particularly after the 2008 financial crisis.

“The economic downturn was probably a crippling blow,” Stone said. “The right and legal thing to do if your business is struggling is to restructure and possibly claim bankruptcy. But they wanted money, so they devised this fraudulent scheme.”

The scheme was complex and successful—for a time.

When the business began to struggle, the company solicited investors—including friends and associates from their community, church, and civic organizations—for “bridge loans.” The company told investors that they would loan Smith Advertising money so the company could pre-purchase advertising at a discount. The company promised to pay back the investors what they loaned plus a cut of the discount.

In fact, the company wasn’t buying advertising. The loans were simply to keep Smith Advertising afloat and repay previous debts—the equivalent of opening a new credit card to pay off a maxed-out one. Some of the early victims were paid back with the promised return, but that was simply other people’s money that the company had borrowed. Other victims, however, lost all of the money they invested.

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Fraudsters Took Advantage of Injured Workers

Injured workers in California thought they were calling a hotline to help them navigate the workers’ compensation system. What they got instead was more pain. Rather than getting the help they needed, callers were set up with a group of corrupt doctors, attorneys, and patient brokers who lined their own pockets at the expense of injured workers.

For years, dozens of marketers, doctors, lawyers, and medical service providers conspired to buy and sell patients—and their individual body parts—like commodities for insurance and workers’ compensation purposes. The San Diego-based fraud ring cheated the California workers’ compensation system and private insurance out of more than $200 million. They also subjected patients to unnecessary, and sometimes painful, medical procedures and corrupted the doctor-patient relationship.

Yet thanks to an investigation by the FBI, the San Diego District Attorney’s Office, and the California Department of Insurance, many of the fraudsters have been convicted and sentenced.

The network preyed predominantly on seasonal, migrant workers who travel back and forth between California and Mexico. Their work in heavy labor industries, such as agriculture, can sometimes result in injuries.

Fermin Iglesias and Carlos Arguello set up various patient recruiting and scheduling companies in Central America and Mexico to direct patients to medical service providers. Arguello operated several patient recruitment entities, including one called Centro Legal. Through billboards, flyers, advertisements, and business cards, Centro Legal recruited workers to seek workers’ compensation benefits. When an injured worker called the number on the billboard or card, a scheduling company took over to maximize the profits from that individual worker.

“The corrupt attorneys and doctors had the same goal—to bill as much as possible,” said Special Agent Jeffrey Horner, who investigated the case out of the FBI’s San Diego Field Office. “The attorneys wanted to get the largest possible settlement by any means necessary, which was traditionally based on total medical billing. The doctors wanted to make as much money as possible, without regard for the well-being of their patients.

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Creator of Website That Stole ATM Card Numbers Sentenced

Nearly half a million Alabama cell phone numbers received identical text messages in 2015 telling them to click a link to “verify” their bank account information. The link took recipients to a realistic-looking bank website where they typed in their personal financial information.

But the link was not the actual bank’s website—it was part of a phishing scam. Just like phishing messages sent over email, the text message-based scam was easy to fall for. The web address was only one character off from the bank’s actual web address.

While most recipients appeared to ignore the message, around 50 people clicked on the link and provided their personal information. The website asked for account numbers, names, and ZIP codes, along with their associated debit card numbers, security codes, and PINs. Within an hour, the fraudster had made himself debit cards with the victims’ account information. He then began to withdraw money from various ATMs, stealing whatever the daily ATM maximum was from each account.

“It was a fairly legitimate-looking website, other than the information it was asking for,” said Special Agent Jake Frith of the Alabama Attorney General’s Office, who worked the case along with investigators from the FBI’s Mobile Field Office.

The fraudster, Iosif Florea, stole about $18,000 (including ATM fees), with losses from each individual account ranging from $20 to $800. (Banks typically reimburse customers who are victims of fraud.)

Investigators believe Florea bought a large list of cell phone numbers from a marketing company, and he only needed a few victims out of thousands of phone numbers for the scheme to be successful.

The damage was minimized, however, because of the bank’s quick response. As soon as customers reported the fraud, the bank reached out to federal authorities as well as the local media to alert the community to the fraudulent messages.

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Couple Sentenced for Arson and Fraud in Fire That Resulted in First Responder’s Death

A Kentucky couple nearly escaped prosecution for setting a fire that burned their rented home to the ground and led to the death of a firefighter until a new FBI agent’s search for fresh evidence helped bring them to justice.

Steve Allen Pritchard, 44, was found guilty by a federal jury of arson and insurance fraud and was sentenced on November 1, 2018, to 30 years in prison. His wife, Brandi Pritchard, who was his girlfriend at the time of the fire, was sentenced to 121 months after pleading guilty to the same crimes.

“This case has stayed with me because it was just so senseless,” said FBI Special Agent William Kurtz of the arson investigation he supported through the FBI’s Bowling Green Resident Agency out of the Louisville Field Office.

According to case records, on June 24, 2011, Brandi Pritchard purchased a $50,000 renter’s insurance policy for the furniture and possessions within the rented Columbia, Kentucky, home she shared with Steve Pritchard. In the early morning hours of June 30, 2011, prosecutors charge that one or both of the Pritchards set fire to the home and then fled the scene.

As firefighters arrived just past 3 a.m., the structure was engulfed in flames. First responders had just succeeded in bringing the fire under control when Columbia/Adair County Fire Department Assistant Chief Charles Sparks, 49, suffered a heart attack.

When firefighters turned their focus to aiding their ill colleague, Kurtz reported, “the fire rekindled and burned the house to the ground.” Sparks died eight days later at a Louisville hospital. Firefighter fatality investigators determined the physical exertion involved in responding to the fire may have triggered his heart attack.

The firefighter’s death prompted an investigation of the fire, but “because the house burned to the ground, any forensic evidence that could have pointed to an arson was destroyed,” said Kurtz.

Immediately after the fire, Brandi Pritchard made a claim against the renter’s insurance policy. She admitted later that Steve Pritchard directed her to invent or inflate the value of items lost during the fire in order to receive the full $50,000 in the policy.

The Kentucky State Police opened an arson investigation after members of the community reported hearing Steve and Brandi Pritchard brag about setting the fire, but investigators had little to go on beyond hearsay.

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Woman indicted for posing as an immigration attorney in Tampa, Chicago

TAMPA, Fla. – Homeland Security Investigations (HSI) Tampa is looking for additional potential victims of a Tampa woman indicted Tuesday on four counts of wire fraud and three counts of wrongfully using government seals in connection with a scheme in which she fraudulently represented herself as an immigration attorney to take money from victims for services she never provided in the Tampa and Chicago areas. This case was investigated by HSI and United States Citizenship and Immigration Services (USCIS).

According to the indictment, Erika Paola Intriago, 44, of Tampa, who is not a licensed attorney, fraudulently portrayed herself as an immigration attorney offering immigration-related services on social media targeting persons from Spanish-speaking countries seeking immigration-related services.

Victims retained and paid Intriago to represent them in immigration-related matters before USCIS and other agencies. Intriago is accused of then creating fraudulent letters, emails, receipts, documents, and communications to send her victims to falsely portray the records as legitimate communications with U.S. government agencies when in fact she never filed or completed the necessary immigration paperwork for which she was paid.

Intriago is also accused of threatening and intimidating victims who complained about her conduct by telling them that she would report their immigration status to U.S. immigration authorities, which Intriago claimed would result in the victims being deported.

If convicted, Intriago faces a maximum penalty of 20 years in federal prison for each count of wire fraud and up to five years in federal prison for each count of wrongfully using government seals.

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Treasurer accused of stealing $410,000 from charity for families of slain NYPD officers

The treasurer of a charity that benefits the families of New York Police Department officers who are killed in the line of duty was charged Thursday with stealing more than $410,000 from the fund.

Lorraine Shanley, 68, was charged by federal prosecutors in New York with bank fraud and aggravated identity theft. She will appear Thursday in court after prosecutors said she was stealing more than 20 percent of donations to the charity between 2010 to 2017 at least.

A person with direct knowledge of the matter confirmed to NBC News that Shanley acted as the treasurer for the nonprofit Survivors of the Shield.

The U.S. Attorney’s Office for the Southern District of New York said that Shanley spent the money in a variety of ways — $29,000 for her grandchild’s private school tuition, $32,000 for personal dental expenses, and $25,000 for landscaping.

Shanley is also accused of using about $63,000 of the stolen money to pay for her son’s legal expenses related to criminal cases, prosecutors said.

Her son was reportedly served about three years in prison on drug charges from 2006 to 2009. He was also charged in 2014 with second-degree manslaughter and leaving the scene of an incident without reporting, resulting in death after he crashed his SUV in Manhattan, killing an activist, and fled. The manslaughter charges were dropped.

She also allegedly wrote $45,000 in checks to family members and other people, which she then endorsed herself and deposited into her own account. Prosecutors said Shanley, from Staten Island, also used $1,400 of the stolen money to buy Barbra Streisand tickets and $6,600 more on other event tickets.

According to court documents, 99 percent of the donations to Survivors of the Shield come from New York police officers, and on average, 5,500 NYPD employees donate to the charity each year.

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Mortgage Fraudster Caused Victims to Lose Out on Dream of Homeownership

The pitch sounded enticing: for an upfront fee, real estate “investor” Hasan Hussain promised to find clients the homes of their dreams or negotiate the loans of existing homeowners struggling to pay their mortgages.

Yet Hussain did neither of those things. He simply took his victims’ money—depriving them of their dreams of homeownership and defrauding them out of more than $1 million. Hussain targeted people for whom English was a second language, encouraging them to sign documents they did not understand.

“One woman gave him her life savings. It was her American dream to find a home, and he told her he’d help her,” said Special Agent Christina Grady, who investigated the case out of the FBI’s Boston Field Office. “But he never followed through on any promises to anyone. He would collect money—from people who didn’t have much money—and pocket it.”

Not only did he target vulnerable homeowners or would-be homeowners but Hussain also had a knack for winning his victims’ trust, becoming “like part of their family,” Grady said.

Hussain, who began his years-long fraud scheme in Rhode Island in 2009 while on supervised release for similar crimes in Massachusetts, used a variety of tactics to defraud his victims, which got more complex over time as he acquired more homes.

For example, he convinced a family struggling to pay their mortgage to move out of their home and into one his other properties; he then rented their home out, collecting rent from the tenants without paying the homeowner’s mortgage.

Another tactic involved convincing homeowners that he was trying to negotiate with their lender on their behalf. Instead he would damage their property to decrease its value, and once the home was damaged, he’d buy the home in a short sale—a term for a property being sold at a price lower than what is owed on the mortgage.

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Former FBI Director Webster Assists Investigation

The heavily accented caller who promised William Webster a grand sweepstakes prize of $72 million and a new Mercedes Benz had done most of his homework on his potential fraud target.

“I know that you was [sic] a judge, you was a lawyer, you was in the U.S. Navy,” the caller told his elderly mark. “I do your background check. You are a big man.”

What the caller, Keniel Thomas, 29, of Jamaica, missed was possibly the most salient detail about his intended victim, who was 90 years old the time: William Webster had served as director of both the FBI and the CIA, and so had a pretty good radar for pernicious criminal schemes—in this case, a Jamaican lottery scam.

Thomas’ persistent calls in 2014 to Webster and his wife, Lynda, followed the familiar arc of scams that target the elderly: The caller promises riches but requires some form of payment to move the process forward. The caller demands more and more, and then resorts to intimidation when the cooperation tapers off.

In the Websters’ case, the former judge was told he had to pay $50,000 to get his prize. When the money wasn’t forthcoming, the frequent calls escalated to scary threats, which led the couple to contact the FBI.

“I don’t know how the conversation turned sour,” said Webster, 95, director of the FBI for a decade beginning in 1978. “But it did. And at that point, he shifted gears. Instead of sweet talk, he began to threaten her.”

In one expletive-filled recorded message left on the Websters’ phone, Thomas threatened to kill them and burn down their house if he didn’t get what he wanted. “You live at a very lonely place,” he said. “And the moment you arrive, I’m gonna put a shot in your head.”

Special agents from the FBI’s Washington Field Office enlisted the Websters’ help in nabbing the caller by recording their phone conversations to build a case and develop a clear picture of the scheme. The legwork ultimately led to Thomas’ arrest in 2017 and his sentencing last month in federal court in Washington, D.C., to nearly six years in prison. It also revealed that Thomas and his relatives in Jamaica had successfully scammed others in the U.S. out of hundreds of thousands of dollars.

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Three Sentenced in Public Corruption Case

An Alabama legislator who was bribed by a corporation to represent the company’s interests—instead of his constituents’—is now serving prison time, and the two men who paid him will be serving time as well.

Former state representative Oliver Robinson, Jr., 58, agreed to a community outreach contract with a law firm that represented Drummond Company, Inc., a Birmingham, Alabama-based coal company. The contract paid Robinson $375,00 over two years. While the contract itself was not illegal, Drummond executive David Roberson and lawyer Joel Gilbert used it as a bribe to induce Robinson to take official action as a state legislator promoting the interests of the company he was secretly representing—a violation of public corruption law.

The Environmental Protection Agency (EPA) had previously informed a Drummond-owned company of its potential responsibility for environmental pollution in North Birmingham—a liability that could cost the company tens of millions of dollars. So Drummond, along with its attorneys, started a public relations campaign to oppose the EPA’s actions. The company and its representatives told local residents not to allow the EPA to test their soil and that their housing values would plummet if the EPA placed the community on its Superfund National Priorities List. Part of the overall strategy was the outreach contract with Robinson to help the company get those messages out.

In early February 2015, Robinson signed a letter (secretly authored by Gilbert) in his official legislative capacity to the Alabama Environmental Management Commission against the EPA’s actions. Later that month, Robinson signed the contract and received his first check from Gilbert’s law firm for $14,000. Four days later, he represented Drummond’s position at an Alabama Environmental Management Commission public meeting, where he claimed to be representing his constituents and did not disclose his financial relationship with the coal company or law firm.

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