Conspirators Sentenced to Prison in Construction Escrow Fraud Scheme

EDGAR J. BEAUDREAULT, JR., 61, of Alpharetta, Georgia, and HOWARD A. SPERLING, 45, of San Diego, California, were sentenced today by United States District Judge Clarence Cooper to federal prison on charges of conspiracy to commit wire fraud for their part in a scheme to defraud a California corrections facility operator of nearly $13 million.

United State Attorney Sally Quillian Yates said, “These defendants were part of an elaborate fraud scheme that ironically involved the construction of a prison. They will now experience how business is conducted inside a real prison.”

BEAUDREAULT was sentenced to three years, five months in prison to be followed by three years of supervised release, and ordered to pay restitution in the amount of $5,417,500. BEAUDREAULT pleaded guilty to the charges on December 17, 2008.

SPERLING was sentenced to five years, 10 months in prison to be followed by three years of supervised release, and ordered to pay restitution in the amount of $5,417,500. SPERLING pleaded guilty to the charges on February 2, 2009.

Both BEAUDREAULT and SPERLING cooperated with the government, and in February 2010, testified in the trial of co-defendant ROBERT B. SURLES, which resulted in guilty verdicts on 16 counts of conspiracy and wire fraud. SURLES is scheduled to be sentenced by Judge Cooper on June 22, 2010.

According to United States Attorney Yates, the charges and other information presented in court: From August 2003 through January 2004, BEAUDREAULT, SPERLING and SURLES conspired to defraud “Cornell Corrections of California, Inc.,” a private company that operates corrections facilities for various governmental units. In June 2003, Cornell Corrections contracted to have a corrections facility built in Canon City, Colorado for $13 million. The $13 million purchase price was to be held in an escrow account until the facility was completed.

In August 2003, the defendants induced Cornell Corrections to transfer its $13 million to an account in Atlanta, which they controlled, by falsely representing to Cornell that the account was an escrow account that was administered by a reputable bank. Upon receipt of Cornell Corrections’ $13 million, the defendants wire transferred the majority of Cornell’s $13 million to other accounts, to be used for their own purposes. Under the terms of their contract, the defendants were also to obtain a construction loan on behalf of “Western Comfort, Inc.” the general contractor who began construction of the facility. No loan was secured, making Western Comfort another victim of this scheme.

This case was investigated by special agents of the Federal Bureau of Investigation.

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Manhattan U.S. Attorney Charges Georgia Man for Selling Fake Vintage Horror Movie Posters and Lobby Cards Over the Internet

PREET BHARARA, the United States Attorney for the Southern District of New York, and GEORGE VENIZELOS, the Special Agent-in-Charge of the New York Office of the Federal Bureau of Investigation ("FBI"), announced that KERRY HAGGARD was arrested this morning in Georgia on mail fraud charges relating to his sale of fake vintage horror movie posters and lobby cards which he misrepresented over the Internet and elsewhere to be authentic vintage collectibles. In doing so, HAGGARD defrauded his victims of over a million dollars in money and property.

According to a criminal complaint unsealed today in Manhattan federal court:

Horror movie posters and lobby cards were displayed in the lobby of movie theaters as a type of advertising product that the movie industry introduced in the 1920s. Lobby cards are popular collectible items which are often sold through auction houses and over the Internet through online auction sites such as eBay.

From January 2006 to August 2009, HAGGARD engaged in a scheme to defraud collectors by selling purportedly vintage horror movie posters and lobby cards which he represented were original pieces, knowing that the items were reproductions that HAGGARD himself had created. HAGGARD used a New York-based printing company to make high-quality ink jet copies of horror movie cards or posters from either hard copies or digital scans of such pieces provided by HAGGARD. HAGGARD also used a restoration company to attach the inkjet copies to lobby card stock and to airbrush and otherwise alter the resulting product to make it look as real as possible.

HAGGARD then fraudulently marketed the reproductions as originals through eBay using a member username and various e-mail addresses. HAGGARD was able to sell numerous fake lobby cards and posters for movies such as "Frankenstein," "Son of Frankenstein," "Mummy's Hand," and "Murder in the Rue Morgue," at prices ranging from $500 to $5,000, to approximately 25 victims. In other instances, HAGGARD traded his fake reproductions to other sellers who gave HAGGARD real lobby cards and/or posters in return.

The victims learned of the fraud in various ways, including after providing the lobby card to a restoration expert, or after consigning the piece to a large auction house for sale. As a result of HAGGARD's fraud, his victims lost more than $1 million in money and property.

HAGGARD is charged with one count of mail fraud. If convicted, he faces a maximum sentence of 20 years in prison and a maximum fine of $250,000 or twice the gross pecuniary loss or gain derived from the offense on each count.

HAGGARD, 45, of Commerce, Georgia, was presented today in federal court in Gainesville, Georgia.

U.S. Attorney PREET BHARARA stated: "Kerry Haggard's purported fraud was a real-life horror show for his victims, who are allegedly out of pocket more than one million dollars. It is especially difficult to police fraud over the Internet, but increasingly important that we do so aggressively. Together with our partners at the FBI, this office will continue to go after those who disguise their scams through online auctions and websites."

FBI Special Agent-in-Charge GEORGE VENIZELOS stated: "Authentic vintage movie posters are valuable pieces of memorabilia sometimes worth thousands of dollars. But Haggard wasn't a legitimate purveyor of fine collectibles. He created and peddled fakes. Whether the merchandise is artwork, baseball memorabilia, or movie posters, if you try to peddle fakes, you'll draw the attention of not just potential purchasers, but the FBI."

Mr. BHARARA praised the work of the FBI's New York and Atlanta field offices and said the investigation in continuing.

This case is being prosecuted by the Office's Complex Frauds Unit. Assistant United States Attorney RYAN P. POSCABLO is in charge of this prosecution.

The charge contained in the criminal complaint is merely an accusation, and the defendant is presumed innocent unless and until proven guilty.

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Delta Flight 273 Passenger Charged with Interfering With Flight Crew and Making False Bomb Threats on Aircraft

/PRNewswire/ -- Derek Michael Stansberry, a U.S. citizen and resident of Riverview, Fla., was charged today in a criminal complaint in the District of Maine with interfering with flight crew members and willfully making false threats about an explosive device on an aircraft, U.S. Attorney Paula D. Silsby announced.

Stansberry, 27, a passenger on Delta flight 273 from Paris to Atlanta on April 27, 2010, was arrested yesterday after the flight was diverted to Bangor, Maine, in connection with his alleged illegal activities. Stansberry is expected to make his initial appearance in federal court in Bangor, but a time for the hearing has not yet been set. He faces a potential sentence of 20 years in prison for interfering with flight crew members and five years in prison for making false threats about an explosive device on an aircraft.

"Making false bomb threats on an aircraft and interfering with the flight crew are serious crimes that have serious consequences," said U.S. Attorney Silsby. "Today's charges should serve as a reminder that the federal government will not tolerate this activity. This case also highlights the extensive resources required to address threats that prove to be false -- resources that could be better utilized addressing real threats."

According to an affidavit filed in support of the criminal complaint, during the course of the flight, Stansberry passed a note to the flight attendant stating, among other things, that he was not an American citizen, that his passports and identity were fake, that he would leave his wallet and passport on the aircraft and "Please let my family know the truth..."

The flight attendant provided the note to a Federal Air Marshal on the plane. Stansberry was then moved to the back of the plane and taken into custody by the air marshals without incident. According to the affidavit, Stansberry told the air marshals that he had dynamite in his boots, which were located in his backpack, and that a pressure plate switch would detonate the dynamite. Stansberry also allegedly stated that there were explosives in his laptop.

According to the affidavit, the air marshals took custody of the laptop and the boots, placed them at the rear of the plane and built a bunker around these items to dampen the effects of any potential explosion. Stansberry remained in custody as the flight was diverted to Bangor.

Upon arrival in Bangor at approximately 3:30 p.m., Stansberry was removed from the aircraft and taken into FBI custody. Passenger and crew were also removed from the aircraft. The Bangor Police Department bomb squad searched the entire plane and all carry-on and checked luggage. No explosive devices were located on the plane or in the luggage.

The affidavit alleges that, after being searched and brought to the holding area at the airport, Stansberry stated that he held high-level government clearances and was in possession of classified documents. He also allegedly stated that he believed people on the plane were following him, ridiculing him and using interrogation techniques on him, although these people never spoke directly to him or asked him any questions.

According to the affidavit, Stansberry said he decided to claim he had a bomb in order to divert attention from himself and the fact that he had classified information. He said he did not actually possess any explosive device and that he did not have the ability to make one. During the interview, Stansberry indicated that he had taken one Ambien earlier in the day. A report by the Federal Air Marshals indicated that Stansberry had stated to an air marshal that he had taken eight Ambien and had previously used Valium but not on this flight.

This investigation is being conducted by the FBI, Federal Air Marshals, U.S. Immigration and Customs Enforcement, Bureau of Alcohol, Tobacco and Firearms, U.S. Customs and Border Protection, Transportation and Security Administration and the Bangor Police Department. The prosecution is being handled by the U.S. Attorney's Office for the District of Maine.

The public is reminded that a criminal complaint contains mere allegations. Defendants are presumed innocent unless and until proven guilty in a court of law.

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Army Colonel Charged with Producing Own Child Pornography

EDGAR PAGAN-TORRES, 41, of Peachtree City, Georgia, a lieutenant colonel with the U.S. Army, has been indicted by a federal grand jury on child pornography production and possession offenses. PAGAN made his initial appearance before a United States Magistrate Judge on April 15, 2009 and was indicted this afternoon.

United States Attorney Sally Quillian Yates said, “This defendant allegedly sexually abused his own daughter and niece and then produced videos of his crimes, ‘mementos’ that he carefully organized into home video-style DVDs. This shocking and tragic conduct has no place in our nation’s military, nor anywhere else. I appreciate all the hard work the U.S. Army investigators did to bring this case to the FBI and to ensure that the Defendant now faces these very serious charges.”

“Today's indictment and continuing investigation clearly illustrates tremendous interagency cooperation with our global law enforcement partners,” said Brigadier General Colleen McGuire, the Provost Marshal General of the Army and the Commanding General of the U.S. Army Criminal Investigation Command. “Working hand in hand with Federal, State and local law enforcement agencies in cross jurisdictional investigations, we are continually proving our commitment to investigate crimes impacting the Army, wherever they may occur.”

According to United States Attorney Yates, the indictment and evidence in public record and in court: PAGAN was assigned to a military installation in Puerto Rico from 2004 to 2007. At that time, he and his family lived near PAGAN’s sister, who has a daughter the same age as PAGAN’s daughter. In 2008, a year after PAGAN and his family relocated to Peachtree City, PAGAN’s niece made an outcry alleging that PAGAN had molested her and his daughter. In 2009, family members passed this information to law enforcement in Puerto Rico, resulting in PAGAN’s guilty plea last month in Puerto Rico to criminal charges related to his niece’s molestation allegations.

At the same time the Puerto Rican authorities were investigating, agents from the U.S. Army’s Criminal Investigations Division based at Ft. McPherson seized various computers and digital media from PAGAN’s home in Peachtree City. Searches of these items revealed sexually explicit videos PAGAN had made involving his daughter and his niece. Some of the videos were made in PAGAN’s home in Puerto Rico and others were made in his Peachtree City residence. Many of the videos had been transferred from the original recording media to home video-style DVDs organized into chapters. Additional forensic work uncovered a large collection of child pornography PAGAN had downloaded from the internet.

Members of the public are reminded that the indictment contains only allegations. A defendant is presumed innocent of the charges and it will be the government's burden to prove the defendant's guilt beyond a reasonable doubt.

This case is being investigated by Special Agents of the FBI, U.S. Army Criminal Investigations Division, and the Peachtree City Police Department.

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State Highway Safety Agencies Supporting Oprah's 'No Phone Zone' Day

/PRNewswire/ -- The Governors Highway Safety Association (GHSA) and its member State Highway Safety Agencies are joining forces with Oprah Winfrey and Harpo Studios to fight distracted driving during "No Phone Zone Day" on Friday April 30, 2010.

Affiliates nationwide will air a special live episode of "The Oprah Winfrey Show" devoted to dangers associated with cell phone use and texting while driving. Special viewing rallies will be held in Atlanta, Boston, Detroit, Los Angeles and Washington, D.C., bringing together victims' families, elected officials, advocacy organizations, parents, youth, and law enforcement to discuss best practices and steps to limit distracted driving in their own communities. In addition, the "Oprah" show will debut a new sponsored public service announcement campaign. All participants and viewers will be asked to pledge to make their cars a "No Phone Zone."

GHSA's State Highway Safety Office members are participating in the viewing rallies and other community mobilization activities. GHSA is encouraging all states to spread the word through news releases, community events, and through social media sites such as Facebook and Twitter. States with distracted driving laws may use the day to draw attention to the legislation. Currently, 23 states and Washington, D.C. have texting laws. (For a full list, visit www.ghsa.org/html/stateinfo/laws/cellphone_laws.html).

GHSA Chairman Vernon Betkey has personally taken the "No Phone Zone" pledge and will participate in the Washington D.C. rally. He notes that "GHSA has always supported a multifaceted approach to combating distracted driving. While state legislation and enforcement are both critical factors, education efforts are also important--and what better person to raise public awareness than Oprah Winfrey? As a society, we need to make cell phone use while driving as unacceptable as drunk driving. We are very grateful to Harpo and Ms. Winfrey for their leadership and commitment."

Also supporting Oprah's "No Phone Zone Day" are: the U.S. Department of Transportation (DOT), National Highway Traffic Safety Administration (NHTSA), National Organizations for Youth Safety (NOYS), FocusDriven, SADD (Students Against Destructive Decisions) and RADD - the Entertainment Industry's Voice for Road Safety.

For a list of state activities, visit: www.ghsa.org/html/projects/dist_drv/npz/2010.html.

To take the "No Phone Zone" pledge, visit: www.oprah.com/nophonezone.

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Smoke Alarm Maintenance How To’s

(BUSINESS WIRE)--With their proven ability to double your family’s chance of surviving a residential fire, smoke detectors are one of the most valuable fire safety tools on the market – yet we tend to take them for granted.

“Smoke alarms are such a common presence in our homes that it’s easy to just expect them to work every time”

“Smoke alarms are such a common presence in our homes that it’s easy to just expect them to work every time,” says CableOrganizer.com product specialist Christina Hansen. “But like many other devices and appliances around the house, smoke detectors require regular cleaning and maintenance to function effectively.”

To ensure the best smoke detection possible, CableOrganizer.com offers these 5 easy tips for keeping household smoke alarms tuned up, properly powered, and ready for action:

* Dust and contaminants can interfere with a smoke alarm’s ability to detect smoke, so clean all detectors in your home at least twice a year. Use your vacuum cleaner’s long upholstery wand to clear away any dust or cobwebs that have settled around the detectors, and – if possible – vacuum out the smoke alarms’ interior compartments as well.
* Don’t wait for that high-pitched chirp to annoy you into changing smoke detector batteries; instead, keep a standing annual date with yourself to replace the battery in each smoke alarm. Try choosing an easy-to-remember date that has personal significance, like a birthday, anniversary, or the day you turn your clocks back from Daylight Savings Time.
* Remember that smoke detectors don’t last forever. Outdated smoke alarms can randomly fail, so it’s important to stay on the safe side and replace all household smoke detectors every 10 years. If you’ve lived in your home for less than 10 years but aren’t sure how old the existing smoke alarms are, don’t take any chances with your safety – switch them out for new units immediately.
* Test smoke detectors monthly by pressing their “test” buttons – if the alarm sounds, everything’s working fine. If you’d prefer extra reassurance, test your alarms with actual smoke. All you need to do is light a candle, blow it out, then immediately hold it a few inches below the detector, allowing a trail of smoke from the just-extinguished wick to drift inside the unit and trigger its alarm.
* If a particular smoke alarm is sounding frequently even when there isn’t any smoke in the air, don’t disable it – instead, investigate the cause of the false alarms. Oftentimes you’ll find that the smoke detector is located too close to the kitchen or bathroom, where cooking fumes and steam can trick it into going off even when there’s no danger. Relocating the detector a little further away should solve the problem; however, if the false alarms keep occurring, you could be dealing with a faulty smoke alarm, in which case it should just be replaced.

Consumers may order a wide selection of smoke and carbon monoxide detectors online at http://CableOrganizer.com or via toll-free telephone at 1-866-222-0030.

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Convicted Felon Indicted for Sex Trafficking of a Minor

CHESIRE MARTINEZ ROBINSON, a/k/a “Candyman,” 28, of Austell, Georgia, was arraigned today on federal charges of trafficking of a minor for sex; transporting a minor in interstate commerce for prostitution; and possession of a firearm by a convicted felon. ROBINSON, who is being held on unrelated state charges, was arraigned before United States Magistrate Judge Gerrilyn Brill and remains detained.

United States Attorney Sally Quillian Yates said, “The FBI and our other partner law enforcement agencies continue to see the brutal victimization of young girls by men who force them into prostitution, and use violence and intimidation to keep them there. We have charged a number of similar cases this year alone, and will continue to find and prosecute these predators who belong in a federal prison where there is no parole.”

FBI Atlanta Acting Special Agent in Charge Ricky Maxwell said, “Exploiting a minor child by forcing her into prostitution is a despicable act that cannot be tolerated. The FBI funds and operates a task force consisting of agents and officers from the surrounding area who are dedicated to combating child prostitution in the region by targeting those that exploit these minor children.”

According to United States Attorney Yates, the indictment and information presented in court: In or about July 2009, and continuing through on or about October 2, 2009, ROBINSON allegedly caused the victim, a 16-year-old girl, to engage in prostitution at various hotels and at a truck stop, in the Atlanta area. ROBINSON brought the victim, who he knew to be a minor, from her home in South Carolina to the Atlanta area. He then placed photographs of the victim in escort and erotic services sections of various Internet websites, and used those ads to recruit men to engage in commercial sex acts with the victim. When the girl refused to engage in commercial sex acts, ROBINSON allegedly beat the victim on several occasions. During a search of ROBINSON’s apartment on October 2, 2009, investigators found a 9 mm pistol that belonged to ROBINSON, who had previously been convicted of the felony offense of armed robbery in Cobb County, Georgia.

The indictment charges ROBINSON with conspiracy; sex trafficking of a minor; transporting a minor in interstate commerce for the purpose of prostitution; and possession of a firearm by a convicted felon. The charges carry a mandatory minimum sentence of 10 years, up to a combined, maximum sentence of life imprisonment, and a fine of up to $1,000,000.

This case is being investigated by the Federal Bureau of Investigation’s Metro Atlanta Child Exploitation Task Force.

Members of the public are reminded that the indictment contains only allegations. A defendant is presumed innocent of the charges and it will be the government's burden to prove a defendant's guilt beyond a reasonable doubt at trial.

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