EAST TEXAS COUPLE SENTENCED FOR FRAUDULENT INVESTMENT SCAM
TYLER, TX -- United States Attorney John L. Ratcliffe announced today that a Comfort, Texas couple has been sentenced for their roles in a wire fraud scheme in the Eastern District of Texas.
DONALD DOUGLAS, 69, received 46 months in federal prison, while CHERYL DOUGLAS, 69, received 5 years probation today before United States District Judge Michael H. Schneider. They were also ordered to pay $1,142,178.00 in restitution to their victims.
According to information provided in court, Donald Douglas would approach potential investors and represent that he owned oil and gas leases, or interests in oil and gas leases in the Eastern District of Texas and elsewhere. Douglas would represent to these investors that he had extensive experience in oil and gas exploration and production. Douglas would represent that these leases were in fields that had previously been in production but production had ceased due to the high costs of extracting oil and gas and the relatively low price of the minerals produced. Douglas would further represent to the investors that higher oil and gas prices, coupled with new and improved technology for recovering the oil and gas, had now made production on these leases extremely attractive and a potentially profitable investment. To support these representations, Douglas would provide investors with numerous documents, including deeds for leases, contracts, prospectuses, and financial statements. Douglas would solicit the investors to invest monies in both the oil and gas leases and the acquisition of oil field equipment with which to produce oil and gas on said leases. Douglas did not, in fact, own the interests in the leases and equipment as he represented to investors, nor did he use investors' monies to acquire the leases and equipment. In addition, the documents that he provided to investors included a mixture of legitimate documents where Douglas had forged his name in place of the legitimate owner and other documents that were complete works of fiction.
Throughout the course of the scheme and artifice to defraud, Douglas convinced investors to invest approximately $1,129,418 in the purported drilling ventures. Douglas did not use the investors' monies for the represented purposes. Instead, he diverted and spent the funds for personal expenses of himself and his family members. Douglas made extensive use of interstate wire communications to defraud investors. Douglas utilized facsimile transmissions, electronic mail sent via the Internet, wire transfers of monies, and telephone calls both as a means of inducing investors to invest in the purported oil and gas transactions and to "lull" investors when they made inquiries and demands for the returns Douglas had promised on their investments.
On April 30, 2007, Donald Douglas pled guilty to an Information alleging Wire Fraud. On the same date, his wife, Cheryl, pled guilty to Misprison of a Felony - that is having knowledge of her husband's fraudulent scheme, affirmatively concealing it, and failing to report it to federal authorities. According to the information, from 1999 through 2004, Donald Douglas engaged in a scheme to defraud persons of money by means of false and fraudulent misrepresentations. Douglas operated a business named Caddo Creek Productions, Inc. that was purportedly in the business of oil and gas exploration and development.
The case was investigated by the Federal Bureau of Investigation and prosecuted by the late Wes Rivers, Assistant United States Attorney, and Assistant United States Attorneys Arnold Spencer and Jim Noble.
FORMER DIRECTOR OF DRUG TREATMENT CENTER SENTENCED FOR HEALTH CARE FRAUD
BEAUMONT, TX -- United States Attorney John L. Ratcliffe announced today that a 58-year-old West Orange woman has been sentenced to 24 months in federal prison for health care fraud in the Eastern District of Texas.
GAYLA R. THURMAN was sentenced by United States District Judge Thad Heartfield today after pleading guilty to health care fraud on March 16, 2007. Thurman was also ordered to pay $319,995.00 in restitution to the Texas Medicaid Program.
According to information presented in court, Thurman, a licensed Chemical Dependency Counselor, was the Executive Director of Artie B’s Bridge of Hope (Artie B’s), located in Orange, Texas. Artie B’s was enrolled in the Texas Medicaid program as a chemical dependency treatment program and from 2001 to 2005, Thurman submitted numerous claims under the Medicaid program for individual and group therapy sessions for Medicaid-eligible adolescents. Artie B’s received payment for these claims when in fact, Thurman was not conducting therapy sessions in accordance with Medicaid requirements. According to the indictment, counselor-interns, under the direction of Thurman, canvassed public housing projects and hosted pizza parties, homework-help sessions, and other activities to lure adolescents and their parents into providing Medicaid numbers for billing purposes. The Medicaid numbers were then used to bill the Texas Medicaid Program for alcohol and drug counseling even though the Medicaid recipient did not meet the diagnostic criteria for substance abuse counseling, and in many cases, was not even present during the alleged counseling sessions. The loss to the Medicaid program exceeded $319,000.00. Thurman was indicted by a federal grand jury on October 5, 2006.
The case was investigated by the Medicaid Fraud Control Unit of the Texas Attorney General’s Office and the Substance Abuse Compliance Group of the Texas Department of State Health Services and prosecuted by Assistant United States Attorney Robert L. Rawls and Texas Assistant Attorney General Chris Tortorice.
FORMER U.S. POSTAL SERVICE EMPLOYEES CHARGED WITH STEALING MAIL
DALLAS — A federal grand jury in Dallas has charged James R. Hamilton, a former lead sales and service associate with the U.S. Postal Service, with stealing mail matter, announced U.S. Attorney Richard B. Roper of the Northern District of Texas.
The one-count indictment, returned on December 4, 2007, charges Hamilton, 55, of Garland, Texas, with one count of theft of mail matter by officer or employee. According to the indictment, Hamilton stole a $200 Wal-Mart gift card from an insured mail package in February 2007. An indictment is an accusation by a federal grand jury and a defendant is entitled to the presumption of innocence unless proven guilty, If convicted however, Hamilton faces a maximum statutory sentence of five years in prison, a $250,000 fine and mandatory restitution.
In a similar, but unrelated case, Salvador Gonzalez, a former letter carrier for the U.S. Postal Service, pled guilty on December 4, 2007, to a one-count Information charging theft of mail matter by an officer or employee. On October 4, 2006, Gonzalez, 35, of Dallas, was stopped for speeding while on his way to work. At that time, he had approximately 2,000 pieces of delayed, undelivered mail, several hundred pieces of riled mail, and some of the contents of the rifled mail, in his possession. The rifled mail included numerous greeting cards, 50 blank checks, 23 checks payable to various people, a social security card, and 53 credit cards, none of which belonged to Gonzalez. Gonzalez admitted that he used some of the credit cards from the rifled mail and removed at least $500 in cash from the greeting cards. Gonzalez is scheduled to be sentenced by U.S. District Judge Ed Kinkeade on February 27, 2008. He faces a maximum statutory sentence of five years in prison, a $250,000 fine and mandatory restitution to the victims.
U.S. Attorney Roper praised the investigative efforts of the U.S. Postal Service - Office of Inspector General. The cases are being prosecuted by Special Assistant U.S. Attorney Amy J. Mitchell.
TEXARKANA MAN SENTENCED FOR HURRICANE RELATED FRAUD
Man Fraudulently Filed Claims for Hurricanes Katrina, Rita and Wilma
TEXARKANA TX – United States Attorney John L. Ratcliffe announced that a 36-year-old Texarkana, Texas man has been sentenced to 12 months and one day in federal prison for hurricane related fraud in the Eastern District of Texas.
GARY WILLIAMS TRICE was sentenced today for three counts of mail fraud. Trice was also ordered by United States District Judge David Folsom to pay a $36,340.50 in restitution for hurricane assistance he fraudulently received for Hurricanes Katrina, Rita and Wilma in 2005.
According to prosecutors, Trice filed three claims with the Federal Emergency Management Agency requesting emergency assistance for damages he claimed to have received from the 2005 hurricanes. An investigation revealed that Trice was not a victim of the hurricanes and was therefore not entitled to FEMA assistance.
In September 2005, the Department of Justice created the Hurricane Katrina Fraud Task Force, designed to deter, investigate and prosecute disaster-related federal crimes such as charity fraud, identity theft, procurement fraud and insurance fraud. The Hurricane Katrina Fraud Task Force – chaired by Assistant Attorney General Alice S. Fisher of the Criminal Division – includes members of the FBI, the Federal Trade Commission, the U.S. Postal Inspection Service, and the Executive Office for United States Attorneys, among others.
This case was investigated by the United States Department of Labor Office of Inspector General, United States Postal Service, and Department of Homeland Security and prosecuted by Assistant United States Attorney Denise Simpson.
LOUISIANA MAN SENTENCED FOR COCAINE IN EAST TEXAS
BEAUMONT, TX – United States Attorney John L. Ratcliffe announced today that a 31-year-old Baton Rouge man has been sentenced to 120 months in federal prison for drug violations in the Eastern District of Texas.
ANTHONY J. LEE pleaded guilty on July 16, 2007 to conspiracy to possess with intent to distribute more than 5 kilograms of cocaine. Lee was sentenced today by United States District Judge Thad Heartfield.
According to information presented in court, Lee was arrested on August 23, 2006 during a traffic stop in Jefferson County, Texas. The arrest was the result of a four year investigation into a cocaine distribution ring. The investigation resulted in the seizure of approximately 150 kilograms of cocaine, $2.3 million in U.S. funds, and the conviction of nine individuals.
This case was investigated by the U.S. Drug Enforcement Administration and the Jefferson County Sheriff's Office and prosecuted by Assistant United States Attorney John Craft.