U.S. Department of Justice Cases
SANTA ANA, CALIF.
A one-time sales representative for AFLAC was sentenced Monday to 10 years in federal prison after being convicted of federal fraud charges related to a scheme that used bogus disability claims to bilk the insurance company out of more than $4 million, officials said.
Patricia Diane Smith Sledge, 61, of Redlands, was sentenced by United States District Judge James V. Selna. In addition to the prison term, Judge Selna ordered Sledge to pay $4.1 million in restitution.
Following a two-week jury trial late last year, Sledge was found guilty of six counts of mail fraud, as well as two counts of witness tampering.
The fraud scheme involved fictitious employers and bogus employees who falsely claimed to have suffered injuries that prevented them from working.
The evidence presented at trial showed that Sledge – who was residing in Irvine while working for the company formally known as American Family Life Assurance Company – sold disability insurance policies to bogus companies and people who supposedly worked for those companies.
Sledge then orchestrated the filing of fraudulent disability claims and directed the purported employees to doctors that would sign off on the fake injury claims.
Sledge made money both from the commissions related to the sale of the fraudulent insurance policies and from kickbacks she received from the supposedly injured “employees.”
Sledge exploited her knowledge of AFLAC’s internal policies and underwriting procedures to further the scheme.
For example, Sledge and others involved in the scheme listed artificially inflated incomes on the applications for insurance because the amount AFLAC paid on disability claims was based on the policyholder’s income.
Sledge was also found guilty of witness tampering for encouraging potential witnesses to lie to federal investigators and discouraging them from cooperating in the investigation.
One of these crimes was committed while she was on bond in this case.
Three others have been prosecuted for acting as fake employers and fake employees in this scheme.
A federal judge on Friday sentenced a Grand Junction, Colorado, man to sentenced to seven years and four months in prison for tax evasion and failing to file personal and corporate income tax returns, officials said.
Timothy Stubbs, 52, was convicted in September 2015 of tax evasion, failure to file an individual income tax return, and failure to file a corporate income tax return following a jury trial in Denver, Colorado.
In addition to the sentence, U.S. District Court Judge Christine M. Arguello ordered Simard to serve three years of supervised release and to pay $639,114 in restitution to the IRS and a fine of $50,000, according to authorities.
According to the evidence presented at trial, Stubbs owned National Rebate Fund Inc. in Grand Junction. Despite earning more than $7 million between 2005 and 2007, Stubbs did not file corporate income tax returns.
Stubbs also earned more than $2 million in income taxable to him personally during those same years and did not file individual tax returns.
According to the evidence at trial, Stubbs had not filed a personal tax return since 1992 and had not paid individual income taxes since 1993.
To conceal his income, Stubbs paid more than $700,000 in personal expenses from the business bank accounts and acquired more than $370,000 in gold and silver in 2007, officials said.
The evidence also indicated that Stubbs purchased real estate in Grand Junction and Crested Butte, Colorado, and two condos in Kailua-Kona, Hawaii, which cost in total more than $2.9 million dollars.
In December 2015, two weeks before to his scheduled sentencing hearing, Stubbs removed his electronic GPS monitoring ankle bracelet and fled to Costa Rica, where he had been living in 2014, prior to being arrested for the indictment.
According to court documents, Stubbs lied to immigration officials in Costa Rica in an attempt to renew his residency in Costa Rica and stay there permanently to avoid punishment in this case. In April 2017, Costa Rica deported Stubbs.
A federal grand jury Thursday indicted a Mexican national designated as an important target because of his links to international drug trafficking, according to officials.
Adrian Ulises Garcia Ruiz allegedly had a meth lab in Hesperia where multiple pounds of methamphetamine were seized.
Garcia-Ruiz, 37, a native of Michoacán, Mexico, was named in a two-count indictment that alleges he supplied liquid methamphetamine that was turned into crystal meth at the San Bernardino County drug lab.
The indictment names a second defendant – Carlos Miguel Gallardo-Valdovinos, also a Mexican national – who allegedly converted the narcotics into crystalline form.
According to the indictment, Garcia-Ruiz coordinated shipments of liquid methamphetamine into the United States, where it was converted into a crystalline form for distribution.
Gallardo-Valdovinos allegedly purchased acetone which he used to convert the liquid methamphetamine into crystalline form at the Hesperia lab.
In May 2014, authorities executed a search warrant at the Hesperia drug lab, where they seized approximately six gallons of liquid methamphetamine, more than nine pounds of crystal methamphetamine and $60,000 in U.S. currency.
The indictment links Garcia-Ruiz to Gallardo-Valdovinos through a series of intercepted communications, some of which indicate that Gallardo-Valdovinos had received six gallons of methamphetamine prior to the seizure.
Garcia-Ruiz was arrested at Dallas/Fort Worth International Airport on Sept. 20.
A federal Magistrate Judge in Dallas detained Garcia-Ruiz, and he is currently being transported to Southern California by the United States Marshals Service. Once Garcia-Ruiz arrives in Southern California, he will be arraigned on the indictment.
The indictment charges Garcia-Ruiz and Gallardo-Valdovinos with two counts: conspiracy to manufacture, possess with intent to distribute, and distribute methamphetamine; and possession with intent to distribute methamphetamine.
Each count carries a mandatory minimum penalty of 10 years in federal prison and up to life.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty in court.
Former prison guard Edgar Daniel Johnson, 51, admitted on Monday to sexually assaulting three female inmates at the Emanuel Women’s Facility in Swainsboro, Georgia, according to officials.
Johnson also admitted that he coerced the women to help him cover up the assaults.
He also plead guilty to making a bomb threat at Elba Island on a separate occasion, in May 2017.
Johnson plead guilty to three counts of willfully depriving the inmates of their Eighth Amendment rights under color of law, three counts of obstruction for coercing the women to cover up the assaults, and one count of maliciously conveying false information about explosive materials.
“No one is above the law, and the criminal actions of this former prison guard compel a strong rebuke. Anyone who chooses to prey on others under color of official right should expect federal prosecution and jail,” said U.S. Attorney R. Brian Tanner.
The Associated Press reported that “more than a dozen women claimed that Johnson victimized them at Emanuel Women’s Facility in Swainsboro. One of them said that 48-year-old Johnson was a pastor who read passages from the Bible.”
During the plea hearing, Johnson admitted that, between November 1, 2012, and September 30, 2013, while he was working as a Georgia Department of Corrections prison guard at the Emanuel Women’s Facility, he engaged in non-consensual vaginal intercourse on more than one occasion with female inmates S.A., M.A., and M.P. Johnson.
Also he admitted that each act of intercourse was against the inmate’s will and violated the inmate’s right under the Eighth Amendment of the U.S. Constitution to be free from cruel and unusual punishment, which includes the right to be free from unwanted sexual assaults.
Johnson further admitted that he coerced each of the inmates to cover up the assaults after the fact to help him avoid detection by investigators, according to officials.
Johnson also admitted that on May 3, 2017, he used a cellular telephone to call Southside Fire Department in Chatham County, Georgia and falsely report a bomb threat at Elba Island, officials said.
“This defendant abused his legal authority to prey on vulnerable women who had been entrusted to his care. His actions undermine the rule of law and the well-being of our communities,” said John Gore, Acting Assistant Attorney General of the Civil Rights Division.