Author: MIL-OSI Publisher

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Former Firefighter Sentenced for Distributing Child Sexual Abuse Material Online

Source: US FBI

WILMINGTON, N.C. – A former volunteer firefighter from Wake Forest was sentenced Wednesday to more than 12 years (151 months) in prison followed by 5 years of supervised release for distribution, receipt and possession of child sexual abuse material.  Royce Cosmo Fuoco, 49, plead guilty on October 8, 2024, to ten counts of Distribution of Child Sexual Abuse Material, one count of Receipt of Child Sexual Abuse Material, and one count of Possession of Child Sexual Abuse Material.

According to court documents and other information presented in court, Fuoco was investigated by the Federal Bureau of Investigations (FBI) after receiving a cyber tip from the National Center for Missing and Exploited Children (NCMEC) that someone with the username “ncfirefighter07” on the social media application Kik had distributed at least 30 videos containing child sexual abuse material.  Law enforcement executed a search warrant for the Kik account and found that user “ncfirefighter07” had 441 instances of distribution of child sexual abuse material to both individuals and groups on the Kik platform.  Law enforcement linked that Kik account to Royce Fuoco, a former volunteer firefighter for the Wake Forest Fire Department.

Law enforcement executed a search warrant at Fuoco’s house.  Several digital devices seized contained child sexual abuse material and evidence of his distribution of the material.  Fuoco admitted to law enforcement that he obtained child sexual abuse material in Kik chat groups.  Fuoco said he was bored while working from home, and he would obtain the child sexual abuse material and then send it to other users.

Daniel P. Bubar, Acting U.S. Attorney for the Eastern District of North Carolina made the announcement after sentencing by Chief U.S. District Judge Richard E. Myers II. The Federal Bureau of Investigation investigated the case and Assistant U.S. Attorney Charity Wilson prosecuted the case.

Related court documents and information can be found on the website of the U.S. District Court for the Eastern District of North Carolina or on PACER by searching for Case No. 5:24-CR-229.

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FBI Arrests 205 Alleged Child Sex Abuse Offenders in Five-Day Nationwide Crackdown

Source: US FBI

In an unprecedented nationwide operation to protect our children and mark April’s National Child Abuse Prevention Month, the FBI announces Operation Restore Justice, a five-day, sweeping FBI initiative to identify, track, and arrest child sex predators across the country in coordination with all 55 of our FBI field offices. Last week alone, the FBI arrested 205 subjects and rescued 115 children across the country during the surge of resources deployed for Operation Restore Justice.

The Charlotte Field Office arrested six people as part of this operation across North Carolina.

  • John Matthew Miller, of Wilmington, 35, is charged with sex trafficking of a minor; enticing a minor to engage in illegal sexual conduct; and producing, distributing, receiving, and possessing child sexual abuse material. Miller was previously convicted of sexual battery and was a registered sex offender at the time of the offense. Miller faces at least 25 years and up to life in prison if convicted on all counts.
  • Jesse Lonzo Teal, of Bolivia, 72, also known as “Lonnie” and “Mark,” is charged with sex trafficking of a minor, enticing a minor to engage in illegal sexual conduct, producing child sexual abuse material, and using the internet to promote an illegal prostitution business enterprise. He faces at least ten years and up to life imprisonment if convicted on all counts.
  • William Justin Lewis, of Louisburg, 54, is charged with distributing child sexual abuse material and possessing child sexual abuse material. He faces at least five years in federal prison and up to twenty years on each distribution count and up to twenty years on the possession count.
  • Donte Melvin Peek, of Durham, 34, is charged with attempted enticement of a minor, distribution of child sexual abuse material, receipt of child sexual abuse material, and possession of child sexual abuse material. He faces at least 10 years imprisonment and up to life imprisonment on the enticement charge and up to twenty years in federal prison on the possession count, if convicted. 
  • Jonathan Robert Davlin, of Huntersville, 48, is charged with transportation of child sexual abuse material and possession and access with intent to view child sexual abuse material involving prepubescent minors. He faces at least five years and up to twenty years imprisonment on the transportation count and up to twenty years imprisonment on the possession count.
  • Terrell Shawn Anderson, previously of Charlotte, 30, is charged with distributing child sexual abuse material and possession of child sexual abuse material. He faces at least five years in federal prison and up to twenty years on each distribution count and up to twenty years on the possession count. He was arrested by FBI Atlanta.

“Producing and exchanging child sexual abuse material (CSAM) is a sickening reality in our world, and it’s not just happening on the dark web. Pedophiles use the same platforms that your family and friends use. No matter where this crime is occurring, the FBI will find you. The Violent Crimes Against Children (VCAC) program is uniquely positioned to work complex global and multijurisdictional crimes against children with the capacity to counter threats of abuse and exploitation of children,” said Robert M. DeWitt, the FBI special agent in charge in North Carolina.

“These important cases reflect the unwavering commitment of our office and our justice system to protect the most vulnerable members of our community—our children. We will continue to work closely with the FBI and our other law enforcement partners to ensure that those who commit such heinous acts are held accountable,” said Acting U.S. Attorney Daniel P. Bubar. “There is no place in our community for those who prey on children, and we will do everything we can to not only seek justice for the victims, but to prevent additional child exploitation crimes.”

“We will aggressively prosecute these cases, as we do all cases against those who seek to exploit and abuse children,” said Russ Ferguson, U.S. attorney for the Western District of North Carolina. “The individuals charged and arrested in this operation are accused of engaging in conduct that harms children and perpetuates their abuse. I commend the FBI in North Carolina and the entire law enforcement community for their ongoing efforts to identify these perpetrators and bring them to justice so they cannot hurt another child.”

“Prosecuting child exploitation crimes remains a top priority for our office,” said Randall S. Galyon, acting U.S. attorney for the Middle District of North Carolina. “With the assistance of the FBI and our other law enforcement partners, we remain steadfast in our commitment to find and punish those who engage in this repugnant activity.”

This initiative during the last week of April was a joint effort with federal, state, and local partners to coincide with the end of Child Abuse Prevention Month and highlight the FBI’s ongoing efforts to confront these crimes. Investigating child sex abuse is an ongoing, high-priority mission of the FBI. The FBI’s Violent Crimes Against Children (VCAC) program coordinates and bolsters efforts to counter all threats of abuse and exploitation of children that fall under FBI jurisdiction—including the production, sharing, and possession of child sexual abuse material; domestical or international travel to engage sexually with children; and the extortion of children to provide sexually explicit material of themselves. VCAC also helps to identify, locate, and recover child victims and strengthen partnerships that are critical to prevent abuse and capture offenders.

For more information about the national Operation Restore Justice initiative, please visit:

For more information about the violent crimes against children investigated by the FBI, as well as the variety of resources we provide to protect and keep children safe, please visit:

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Operation Take Back America Leads to Criminal Charges Against Multiple Defendants for Firearms Offenses and Immigration-Related Violations

Source: US FBI

CHARLOTTE, N.C. – U.S. Attorney Russ Ferguson announced today that in April the U.S. Attorney’s Office charged 11 defendants with criminal charges related to firearms offenses and immigration-related violations as part of Operation Take Back America, a nationwide initiative to repel the invasion of illegal immigration, achieve total elimination of cartels and transnational criminal organizations (TCOs), and protect our communities from perpetrators of violent crime.

The defendants facing federal firearms charges are:

Steven Tyler Philbeck, 33, of Lincolnton, N.C., is charged with possession of a firearm by a convicted felon, possession of a firearm in furtherance of a drug trafficking crime, and distribution of methamphetamine. The indictment alleges that Philbeck distributed methamphetamine in Catawba County in February 2025, and illegally possessed a Glock 19 Gen4, 9mm handgun in furtherance of the drug trafficking activities.

Naquan Damerius Blakeney, 24, of Charlotte, is charged with possession of a firearm by a felon. The indictment alleges that Blakeney illegally possessed a Glock Model 23, .40 caliber pistol, and did so knowing he was prohibited from possessing a firearm following a prior criminal conviction.

Justin Lloyd Coleman, 33, of Huntersville, N.C., is charged with two counts of possession of a machinegun and one count of possession of a firearm by a felon. The indictment alleges that Coleman illegally possessed one more machineguns, a pistol, and a rifle. Coleman has prior felony convictions, and he is prohibited from possessing firearms.

Kiren Nashawn Heath, 21, of Monroe, N.C., is charged with possession of a firearm by a convicted felon. The indictment alleges that Pressley possessed a Walther, model P99, 9mm pistol frame with a Smith & Wesson, model SW99, 9mm pistol slide, and did so knowing he was a convicted felon and was prohibited from possessing a firearm.

Daquan Devonte Jeter, 33, of Charlotte, was indicted for the unlawful possession of a firearm. Jeter is alleged to have unlawfully possessed what is commonly known as a “sawed-off” shotgun, knowing he had prior felony convictions.

Norris Lashane Myers, 47, of Lenoir, N.C., is charged with possession of a firearm by a convicted felon. The indictment alleges that Myers possessed a Taurus PT92AF, 9mm handgun, knowing he was a convicted felon and was prohibited from possessing a firearm.

Nathaniel Desean Nicholes, 25, of Charlotte, is charged with possession of a firearm by a felon. The indictment alleges that Nicholes, knowing that he had previously been convicted of multiple state felony charges for Breaking and Entering, unlawfully possessed a Glock, model 19, 9mm caliber semi-automatic pistol.

The defendants charged with immigration-related violations are:

Jose Guadalupe Cervantes Nava, 52, of Mexico, is charged with illegal reentry into the United States. Nava was previously deported from the United States four times in two months: on April 13, 2018, on April 20, 2018, on May 3, 2018, and again on May 20, 2018.

Remedios Arroyo Beltran, 51, of Mexico, is charged with illegally reentering into the United States. Beltran was previously deported from the United States three times: on April 22, 2019, on July 7, 2019, and again on July 12, 2019.

Erik Antonio Lopez-Hernandez, 21, of Honduras, is charged with illegally reentering into the United States. Lopez-Hernandez was previously deported from the United States in July 2023. He was arrested on February 22, 2025, by the Charlotte Mecklenburg Police Department, after the defendant allegedly attempted to flee and evade arrest for a traffic violation.

Darwin Gonzalez Navarijo, 40, of Guatemala, is charged with illegal reentry into the United States. Navarijo was previously deported from the United States three times: in June 2009, in November 2010, and again in June 2017.

The charges in the indictments are allegations and the defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

In making today’s announcement, U.S. Attorney Ferguson credited Homeland Security Investigations, Immigration and Customs Enforcement – Emergency Removal Operations, the Federal Bureau of Investigation, and the Bureau of Alcohol, Tobacco, Firearms, and Explosives for their investigations that led to the charges. U.S. Attorney Ferguson also commended the local law enforcement agencies that assisted in the investigation and apprehension of the defendants, to include the Caldwell County Sheriff’s Office, the Catawba County Sheriff’s Office, the Union County Sheriff’s Office, the Charlotte Mecklenburg Police Department, the Hickory Police Department, and the Huntersville Police Department.

Assistant U.S. Attorneys with the Criminal Division of the U.S. Attorney’s Office in Charlotte are prosecuting the cases. 

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Charlotte Man Sentenced to Prison for His Role in Multimillion-Dollar Bank Fraud Scheme

Source: US FBI

CHARLOTTE, N.C. – A Charlotte man was sentenced to prison today for his role in a multi-million dollar bank fraud scheme, announced Russ Ferguson, U.S. Attorney for the Western District of North Carolina. Bruce Howard Marko, 66, was sentenced to 12 months and a day in prison followed by two years of supervised release, and was ordered to pay restitution in the amount of $1.5 million. Marko pleaded guilty to conspiracy to commit wire fraud and bank fraud.

Marko’s three co-defendants, Kotto Yaphet Paul, 50, of Waxhaw, N.C., Latoya Tamieka Ford, 50, of Covington, Georgia, and Love Norman, 50, of West Palm Beach, Florida, have each pleaded guilty to wire fraud and bank fraud conspiracy and are awaiting sentencing. Paul also pleaded guilty to money laundering.

According to filed court documents and today’s sentencing hearing, beginning in 2018, Marko conspired with Peebles, Paul and Ford to orchestrate a fraudulent loan scheme that defrauded at least 17 federally insured financial institutions of more than $17 million. Marko participated directly in at least five of these fraudulent loans totaling over $2.8 million. To execute the scheme, Marko and his co-defendants submitted loan applications to financial institutions that contained fraudulent information, including false employment and income information, false tax returns, and misrepresentations regarding the applicants’ assets, liabilities, and the intended use the loan proceeds. Based on the fraudulent loan applications, Marko and his co-defendants secured at least 42 loans from the victim financial institutions. Contrary to information provided on the loan applications about the purposes of the loans, the defendants used the loan proceeds to purchase real estate, cover unrelated business expenses, make investments, make payments toward earlier loans, and pay for personal expenditures. Court documents show that the defendants defaulted on most of the loans, causing substantial losses to the victim financial institutions that issued the loans.

Four additional defendants were previously convicted of bank fraud conspiracy for their involvement in the scheme. Amrish D. Patel was sentenced to 15 months in prison, Dwight A. Peebles, Jr. was sentenced to 18 months in prison. Denise Woodard was ordered to serve 36 months in prison, and Derrick L. Harrison, was sentenced to a year and a day in prison. The defendants were also ordered to pay restitution ranging from $620,000 to more than $3.1 million.

In making today’s announcement, U.S. Attorney Ferguson credited the Office of the Inspector General of the Board of Governors of the Federal Reserve System, the Office of the Inspector General for the Federal Housing Finance Agency, the Office of the Inspector General for the Federal Deposit Insurance Corporation, the Federal Bureau of Investigation in Charlotte, and the Charlotte Field Office of the Internal Revenue Service’s Criminal Investigation, for the investigation of this case.

Assistant U.S. Attorney Don Gast with the U.S. Attorney’s Office in Asheville is prosecuting the case.

 

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Charlotte Clinic Owner Agrees to Settle Allegations of Medicaid Fraud

Source: US FBI

CHARLOTTE, N.C. – Steven Osbey, of Kernersville, N.C., has agreed to entry of a consent judgment against him in the amount of $4,711,159.00 in favor of the United States and State of North Carolina (the Governments), subject to a separate agreement regarding his participation in the Governments’ ability to pay process. The judgment represents repayment to the government for allegations that Reign & Inspirations, LLC (R&I), a clinic co-owned by Osbey and Aljihad Shabazz, charged Medicaid for physician home visits that never occurred.

More specifically, the Governments alleged Osbey and Shabazz conspired to carry out an extensive health care fraud scheme wherein they submitted or caused to be submitted claims to NC Medicaid for in-home physician visits with patients that simply never occurred—in all, billing more than 30,000 hours of these purported physician visits and sometimes billing as if the physician provided over 100 in-home visits in a single day, purportedly lasting an hour each (an obvious physical impossibility).

This investigation was conducted in parallel between the civil and criminal divisions of the U.S. Attorney’s Office. Shabazz pleaded guilty to criminal healthcare fraud conspiracy and money laundering charges and was sentenced to 52 months in prison followed by two years of supervised release.

The civil settlement obtained in this matter was the result of a coordinated effort between the Department of Justice and the FBI field offices in Charlotte, with assistance from the Medicaid Investigations Division of the North Carolina Attorney General’s Office, and the Office of Inspector General of the United States Department of Health and Human Services. AUSAs Caroline McLean and Seth Johnson were responsible for the civil investigation.

The investigation and resolution of this matter illustrates the government’s emphasis on combating health care fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement, can be reported to the Department of Health and Human Services at 800-HHS-TIPS (800-447-8477).

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Registered Sex Offender Charged with Sending Obscenity to a Massachusetts Minor

Source: US FBI

Jay Clayton, the United States Attorney for the Southern District of New York, and James Crowley, the Acting Special Agent in Charge of the Boston Field Division of the Federal Bureau of Investigation (“FBI”), announced today the arrest of DAVID FERNANDES III.  FERNANDES is charged with sending obscenity to a minor and being a registered sex offender when he sent obscenity to a minor.  FERNANDES was arrested Thursday, May 1, and presented Friday, May 2, before U.S. Magistrate Judge Judith C. McCarthy in White Plains federal court and detained.

U.S. Attorney Jay Clayton said: “Allegedly, David Fernandes III, a registered sex offender, was not deterred by his previous involvement with the criminal justice system. This case underlines the urgent need for law enforcement to continue its efforts to protect children. The women and men of the Southern District and the FBI will use every tool available to investigate and prosecute those who sexually exploit children.”   

FBI Acting Special Agent in Charge James Crowley said: “Anyone willing to sexually exploit children deserves to feel the full force of the law. The FBI has arrested David Fernandes, a registered sex offender, for sending sexually explicit material to an 11-year-old child in Massachusetts. Each time we’re able to step in and protect a child from further sexual exploitation, it’s a good day.”

As alleged in the Complaint filed on April 29, 2025, in White Plains federal court and statements made in court[1]:

On or about October 8, 2024, FERNANDES knowingly transmitted to an 11-year-old an obscene photo of an adult male hand holding a penis. At the time FERNANDES engaged in this felony offense involving a child, he was required to register as a sex offender.

On March 19, 2019, FERNANDES was convicted in New York state of Disseminating Indecent Material to a Minor, for which he received a sentence of five years’ probation. He completed this sentence on or about September 12, 2024.   

On or about October 11, 2024, the mother of an 11-year-old child (“Victim-1”) reported to the Holden Police Department, in Holden, Massachusetts, that she had discovered sexually explicit images and communications on Victim-1’s phone with a phone number ending in 4245 (the “4245-Phone”). She also reported that her daughter had advised her that her daughter’s 12-year-old friend (“Victim-2”) had been in communication with the user of the 4245-Phone. 

A forensic review of Victim-1’s phone revealed over 4000 messages exchanged between Victim-1’s phone and the 4245-Phone between October 4, 2024, and October 8, 2024. In the messages, the user of the 4245-Phone identified himself as a 26-year-old man and transmitted sexually explicit videos and photos of an adult man to Victim-1’s phone. At approximately 4:41 a.m. on October 4, 2024, the 4245-Phone transmitted a video to Victim-1’s phone revealing an adult holding an erect penis, masturbating and ejaculating. At approximately 3:58 a.m. on October 8, 2024, the 4245-Phone texted, “I wanna feel u,” “Like genuinely feel inside u” and “I wanna be all the way inside you.” At approximately 4:00 a.m. on October 8, 2024, the 4245-Phone transmitted a photo of a male hand holding an erect penis. Shortly thereafter, the 4245-Phone texted, “Imagine that inside u.”

Victim-1 advised law enforcement that she first communicated with the 4245-Phone on or about October 4, 2024. Victim-2 advised law enforcement that she began communicating with the user of the 4245-Phone, who identified himself to her as “David,” in approximately September 2024 and communicated with him on Snapchat, Roblox, and through video chats on Google Meet. Victim-2 advised that “David” requested sexually explicit pictures and videos of Victim-2 and that she transmitted them to him, mostly via Snapchat. Victim-2 provided “David” with Victim-1’s phone number so that she and David could message one another.

Anyone who may have encountered FERNANDES, who used the Snapchat user names “tazjazz,” “diamondboy24k,” “itsmagikyouknow,” and “retrovxrse, or whose child may have had any communications with FERNANDES, is asked to contact the FBI at 1-800-CALL-FBI (225-5324).

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FERNANDES, 27, of Lagrangeville, New York, is charged with one count off transferring obscene material to a minor, which carries a maximum sentence of 10 years in prison, and one count of committing the offense while being required to register as a sex offender, which carries a mandatory consecutive sentence of 10 years in prison. 

The statutory maximum sentences are prescribed by Congress and provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge. 

Mr. Clayton praised the efforts of the FBI, including the FBI New York Hudson Valley Safe Streets Task Force and FBI Boston; the Holden Police Department; the U.S. Attorney’s Office for the District of Massachusetts; the Dutchess County Sheriff’s Office; and the Town of Poughkeepsie Police Department in connection with this investigation.        

The prosecution is being handled by the Office’s White Plains Division.  Assistant U.S. Attorney Marcia S. Cohen is in charge of the prosecution.   

The charges contained in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.

 

[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth herein constitute only allegations, and every fact described should be treated as an allegation.

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Snapchat User Charged in Interstate Scheme to Lure Minors Into Producing Sexually Explicit Material

Source: US FBI

Jay Clayton, the United States Attorney for the Southern District of New York, and Christopher G. Raia, the Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced today the unsealing of a Complaint charging BRIAN LIAM FULLERTON with three counts of sexual exploitation of a child. FULLERTON was arrested this morning and presented today before U.S. Magistrate Judge Judith C. McCarthy in White Plains federal court. 

U.S. Attorney Jay Clayton said: “As alleged, Brian Fullerton used Snapchat and other social media applications to manipulate and exploit numerous minor victims. We will deploy every resource at our disposal to protect the most vulnerable among us, and we will prosecute those who prey on our children to the fullest extent of the law.”

FBI Assistant Director in Charge Christopher G. Raia said: “Brian Fullerton allegedly directed several female minors to record and perform sexual acts, while requiring secrecy upon learning the victims’ underage status. The defendant allegedly engaged in unlawful sexual communications and induced the repeated production of explicit content, violating the victims’ privacy and preying upon their innocence. The FBI remains determined to apprehend any individual who sexually exploits minors to fulfill their perverted gratification.”

As alleged in the Complaint:[1] 

From as early as September 2022, FULLERTON used social messaging applications, including Snapchat, to prey on victims as young as 14 years old. FULLERTON got these victims to send him sexually explicit photos and videos of themselves. Among those FULLERTON targeted was a 14-year-old minor (“Victim-3”), from whom FULLERTON obtained several sexually explicit videos and to whom FULLERTON sent sexually explicit text messages, writing, among other things, “I wish you lived in New York, so I can f*** you for real … You want to be bred by a man three times your age you dirty little girl … I scrolled to make sure my face wasn’t in any pics don’t need them seeing how old I am ;).”

Photos depicting FULLERTON are below:

Any individuals with information concerning FULLERTON and any individuals who may have encountered someone using the Snapchat username “lomax518,” the Instagram username “BRADSMITH4187,” the Kik username “lomax518,” or the TikTok username “bradsddysza,” please contact the FBI at 1-800-CALL-FBI (1-800-225-5324) or https://tips.fbi.gov.

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FULLERTON, 46, of Mahopac, New York, is charged with three counts of sexual exploitation of a child, each of which carries a 15-year mandatory minimum and a 30-year maximum sentence.

The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendants will be determined by a judge. 

Mr. Clayton praised the outstanding work of the FBI and the Warren County Sheriff’s Office. 

This case is being handled by the Office’s White Plains Division.  Assistant U.S. Attorney Carmi Schickler is in charge of the prosecution.

The charges contained in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.

 

[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth herein constitute only allegations, and every fact described should be treated as an allegation.

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Former Teacher in New York City Charged with Distribution and Possession of Child Pornography

Source: US FBI

Jay Clayton, the United States Attorney for the Southern District of New York and Christopher G. Raia, the Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”) announced today the arrest of SAMUEL GONZALEZ, a former teacher at an acting school in New York City.  GONZALEZ is charged with distributing and possessing child pornography, including videos depicting the sexual abuse of infants and toddlers.  GONZALEZ will be presented later today before U.S. Magistrate Judge Barbara Moses.

U.S. Attorney Jay Clayton said: “As alleged, Samuel Gonzalez distributed a large volume of child pornography, including images of sexual abuse of children as young as a few months old.  The lasting scars from the horrific abuse of children are deeply troubling to all New Yorkers.  Together with our partners, we will relentlessly pursue those who victimize children and prosecute them to the fullest extent of the law.”

FBI Assistant Director in Charge Christopher G. Raia said: “Samuel Gonzalez allegedly distributed thousands of pornographic images of infants and minors to an undercover federal agent over a brief period.  Gonzalez’s alleged actions grossly disregarded the victims’ welfare and repeatedly violated their privacy by sharing this twisted material.  The FBI is deeply committed to preventing crimes against children and will continue to apprehend any individual who supplies these explicit images.”   

According to the allegations contained in the Complaint:[1]

GONZALEZ is an actor, dancer, theater producer, and former teacher at an acting school in New York City.  In or about January 2023 and April 2023, GONZALEZ used an online messaging application to send links containing over 1,500 files of child pornography to a federal law enforcement agent acting in an undercover capacity.   In addition, in or about June 2023, federal agents executed a judicially-authorized search warrant of GONZALEZ’s apartment.  Pursuant to that warrant, federal agents seized and searched GONZALEZ’s phone and laptop, which were found to contain over 80 unique files of child pornography, including videos and images of infants and prepubescent adolescents who had not attained 12 years of age.

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GONZALEZ, 31, of Brooklyn, New York, is charged with one count of distribution of child pornography, which carries a mandatory minimum sentence of five years in prison and a maximum sentence of 20 years in prison.  GONZALEZ is further charged with one count of possession of child pornography, which carries a maximum sentence of 20 years in prison.

The statutory maximum potential sentence in this case is prescribed by Congress and provided here for informational purposes only, as any sentencing of the defendant will be determined by a judge.

Mr. Clayton praised the outstanding investigative work of the FBI and the FBI/New York City Police Department Child Exploitation and Human Trafficking Task Force. 

This case is being handled by the Office’s General Crimes Unit.  Assistant U.S. Attorneys Katherine Cheng and Diarra M. Guthrie are in charge of the prosecution.

The charges contained in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty. 

 

[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth herein constitute only allegations, and every fact described should be treated as an allegation.

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U.S. Attorney Announces $202 Million Settlement with Gilead Sciences for Using Speaker Programs to Pay Kickbacks to Doctors to Induce Them to Prescribe Gilead’s Drugs

Source: US FBI

Gilead Admits to Paying Hundreds of Thousands of Dollars to High Prescribers of Gilead’s HIV Drugs to Serve as Speakers at Programs and to Holding Programs at Luxury Restaurants

Jay Clayton, the United States Attorney for the Southern District of New York; Naomi Gruchacz, the Special Agent in Charge of the New York Regional Office of the U.S. Department of Health and Human Services, Office of Inspector General (“HHS-OIG”); Christopher M. Silvestro, the Acting Special Agent in Charge of the Northeast Field Office of the Defense Criminal Investigative Service (“DCIS”), the law enforcement arm of the Department of Defense’s Office of Inspector General (“DOD-OIG”); and Christopher G. Raia, the Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced today that the U.S. has settled a civil fraud lawsuit against GILEAD SCIENCES, INC (“GILEAD”), a large pharmaceutical manufacturer, that, among other things, develops, manufactures, and sells drugs for the treatment of infectious diseases, including HIV/AIDS. The settlement resolves claims that GILEAD offered and paid kickbacks in the form of honoraria payments, meals, and travel expenses to healthcare practitioners who spoke at or attended Gilead speaker events to induce them to prescribe Stribild®, Genvoya®, Complera®, Odefsey®, Descovy®, and Biktarvy® (the “Gilead HIV Drugs”) in violation of the Anti-Kickback Statute (“AKS”) and thereby caused false claims for the Gilead HIV Drugs to be submitted to and paid by federal healthcare programs in violation of the False Claims Act.

Under the settlement, which was approved yesterday by U.S. District Judge Paul A. Engelmayer, GILEAD agreed to pay a total sum of $202 million, of which $176,927,889.28 will be paid to the U.S. and the remainder will be paid to various states.  As part of the settlement, GILEAD also made extensive factual admissions regarding its conduct.

U.S. Attorney Jay Clayton said: “For years, Gilead unlawfully sought to increase sales of its HIV drugs, by using its speaker programs to funnel kickbacks to doctors.  As alleged, Gilead spent tens of millions of dollars on these programs, including over $20 million in speaking fees and millions more in exorbitant meals, alcohol and travel, all in an effort to induce doctors to prescribe Gilead’s HIV drugs and drive up sales.  With this settlement, Gilead has taken responsibility for its conduct and agreed to pay a significant financial penalty.  The message is clear, companies that illegally drain taxpayer dollars from federal healthcare programs will be held accountable.”

HHS-OIG Special Agent in Charge Naomi Gruchacz said: “This impactful settlement is the result of collaborative work by law enforcement partners, revealing Gilead’s unlawful practice of providing kickbacks to physicians under the guise of its HIV educational speaker programs.  Violations of the Anti-Kickback Statute, which in this case involved expensive HIV medications, can inappropriately influence physicians’ decision-making and divert the monies of taxpayer-funded federal healthcare programs.”

DCIS Acting Special Agent in Charge Christopher M. Silvestro: “This settlement is the result of the partnership among law enforcement and the Department of Justice to aggressively investigate and hold accountable companies and their employees who value greed over healthcare.  Protecting TRICARE, the healthcare system for Service members and their families, and investigating kickback schemes are priorities for DCIS.”

FBI Assistant Director in Charge Christopher G. Raia said: “This settlement ensures Gilead is held accountable for their illicit use of perks and kickbacks to entice doctors to prescribe the company’s medicine.  These types of schemes are not victimless – illegal kickbacks directly affect taxpayer funded healthcare programs.  The FBI will continue to investigate and stop healthcare companies attempting to benefit from deceitful and illegal practices.”

As alleged in the Complaint filed in Manhattan federal court:

The Gilead HIV Drugs are antiretroviral drugs (i.e., drugs that act against retroviruses such as HIV) used for the treatment of HIV.  These drugs are very expensive—Medicare typically paid well in excess of a thousand dollars for a one-month supply of Complera®, and significantly more for many of the other Gilead HIV Drugs.

As part of its marketing efforts and to increase sales, Gilead conducted events known as “HIV Speaker Programs” at which a healthcare provider involved in the treatment of HIV was engaged to present a slide deck (prepared by Gilead) and facilitate discussion about one of the drugs or a topic concerning HIV (an “HIV Disease State Topic”) to other healthcare providers involved in the treatment of HIV (“Attendees”).  Gilead’s HIV Speaker Programs were often held in the evening at restaurants (“HIV Dinner Programs”).

From January 2011 to November 2017 (the “Relevant Time Period”), Gilead conducted HIV Speaker Programs in order to promote and increase the sales of the Gilead HIV Drugs.  The HIV Speaker Programs were supposed to be educational in nature and the cost of any meals provided was supposed to be modest.  But in practice, during the Relevant Time Period, Gilead’s HIV Speaker Programs provided kickbacks to healthcare providers by: holding HIV Dinner Programs at high-end restaurants that were wholly inappropriate for educational events; allowing Attendees to attend HIV Dinner Programs on the exact same topic again and again and, thereby, obtain free lavish meals for events that held minimal educational value for them; and paying for HIV Speakers to travel to speak at desirable destinations—at times at the HIV Speaker’s request.  Further, Gilead’s compliance program failed to prevent these improper practices, even though Gilead knew that it had to comply with the AKS and the company’s own data should have put Gilead on notice of many of these abuses. 

Many healthcare providers who received these improper kickbacks then prescribed the Gilead HIV Drugs.  As a result, federal healthcare programs paid millions of dollars in reimbursements for tainted prescriptions.

As part of the settlement, GILEAD admitted and accepted responsibility for certain conduct alleged by the U.S., including the following:

  • Gilead paid many high-volume prescribers of HIV drugs tens or hundreds of thousands of dollars in honoraria to prepare and present as HIV Speakers.  For instance, one HIV Speaker, who received over $300,000 in total honorarium payments, wrote prescriptions for Gilead HIV Drugs that resulted in over $6 million in Medicare, Medicaid, and TRICARE payments.
  • On many occasions, Gilead covered the travel costs of HIV Speakers who traveled long distances to speak at HIV Speaker Programs at desirable travel destinations, such as Hawaii, Miami, and New Orleans.  This was sometimes in response to an HIV Speaker’s request to be booked for an HIV Speaker Program in that city.
  • Sales representatives in Gilead’s HIV therapeutic area (“Sales Representatives”) organized HIV Speaker Programs at high-end restaurants across the country.  For instance, a significant percentage of the HIV Speaker Programs held in New York City were held at expensive restaurants, such as the James Beard House, Del Posto, Asiate, Palma, Vaucluse, Ilili, and Limani.  In particular, Gilead held 157 HIV Speaker Programs at the James Beard House, making it one of Gilead’s most used venues for HIV Speaker Programs.  A dinner at the James Beard House typically included approximately six courses with alcoholic beverage pairings.
  • Sales Representatives repeatedly invited numerous doctors and other healthcare providers to attend the same HIV program over and over.  Many repeatedly attended HIV Speaker Programs covering the exact same topic, often within a short period of time.
  • Over 250 prescribers of the Gilead HIV Drugs attended HIV Dinner Programs on the same topic three times or more within a six-month period.  And over 80 of them attended five or more HIV Dinner Programs on the same topic within a six-month period.
  • Further, many healthcare providers who were paid to be HIV Speakers on a particular topic also attended HIV Dinner Programs on exactly the same topic, often within less than six months after speaking.
  • In certain instances, the same group of doctors repeatedly attended the same HIV Speaker Programs together at various restaurants.  In many instances, they attended a HIV Dinner Program less than two weeks after speaking on the same topic.
  • During the Relevant Time Period, Gilead’s policies and procedures failed to prevent Sales Representatives and Regional Directors in its HIV therapeutic area from improperly providing honoraria payments, meals, and travel expenses to healthcare providers who spoke at or attended HIV Speaker Programs to induce them to prescribe the Gilead HIV Drugs. 

In connection with the filing of the lawsuit and settlement, the Government joined a private whistleblower lawsuit that had been filed under seal pursuant to the False Claims Act.

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Mr. Clayton thanked the New York Medicaid Fraud Control Unit for their extensive collaboration in the investigation and resolution of this case, and also praised the outstanding investigative work of the FBI, HHS-OIG and DCIS.

The case is being handled by the Office’s Civil Frauds Unit.  Assistant U.S. Attorneys Jacob M. Bergman, Allison M. Rovner, Rebecca S. Tinio, and Lucas Issacharoff are in charge of the case.