Assistant Attorney General Brian A. Benczkowski Delivers Remarks at the American Conference Institute’s 36th International Conference on the Foreign Corrupt Practices Act

Remarks as Prepared for Delivery

Good morning, and thank you, Rachel for that kind introduction.

It is an honor and privilege to address this year’s ACI Conference on the Foreign Corrupt Practices Act.  Although there are many excellent legal conferences throughout the year, this one always stands out because of the quality of the speakers and the deep substantive focus on foreign bribery investigations and prosecutions. 

I am particularly pleased to be here at this time, given that the Criminal Division has seen remarkable prosecution activity and case developments in the FCPA space over the past year.   

So far in 2019, the Criminal Division’s FCPA Unit has publicly announced more charges against individuals [34] than in any other year in history.  It has also publicly announced more guilty pleas by individuals [30] than ever before.  

This number of individual prosecutions in 2019 is not an outlier or a statistical anomaly.  Rather, it is part of the Department’s continued dedication to holding individual wrongdoers accountable across the board. 

Indeed, this year’s record number of individual FCPA charges and guilty pleas builds on 2017 and 2018, which were previously the two biggest years for those categories of cases.  

Building cases against individuals takes time and resources, even more so when those individuals assert their trial rights. 

And yet, these overall individual prosecution numbers (charges and pleas) have been generated in a year in which our prosecutors also have been very busy at trial. 

So far in 2019, the FCPA Unit has equaled its annual high-water mark for trials ending in conviction. 

Yet, our work prosecuting individual wrongdoers has not impacted our efforts to police corporate FCPA cases.  By the end of this week, the FCPA Unit will have resolved seven corporate cases with criminal resolutions in 2019, as well as two additional cases that were resolved via declinations with disgorgement under the FCPA Corporate Enforcement Policy. 

These corporate resolutions – including one to be announced later this week – collectively represent the largest amount ever recovered by the DOJ in FCPA cases in a single year ($1.6B versus the previous high in 2016 of $1.3B), and a total of $2.8 billion recovered globally through coordinated resolutions.

In addition to its efforts under the FCPA, the Criminal Division also pursues foreign corruption through money laundering enforcement and asset forfeiture.  The Division’s Kleptocracy Asset Recovery Initiative is a prime example of that enforcement. 

Administered through our Money Laundering and Asset Recovery Section (MLARS), prosecutors, analysts and agents investigate and prosecute acts of high-level foreign corruption – such as embezzlement and money laundering – that affect the U.S. financial system.

The Section also brings asset recovery actions to seize and forfeit the proceeds of foreign official corruption in which, as appropriate, the proceeds are returned for the benefit of the foreign citizens that were victimized by that greed. 

The success of the Kleptocracy Initiative was on full display in 2019, as it reached a historic settlement of its civil forfeiture cases against assets acquired by Low Taek Jho, known to all as Jho Low.

Jho Low allegedly used funds misappropriated from 1MDB, Malaysia’s investment development fund, and laundered them through financial institutions in several jurisdictions, including the United States, Switzerland, Singapore and Luxembourg. 

Low then allegedly engaged in extravagant spending sprees, acquiring valuable artwork, real estate, airplanes, yachts, and sports cars, all while gambling freely at casinos, and enjoying what any observer would call a lavish lifestyle. 

The terms of this settlement are striking, especially when considered alongside the Division’s prior disposition of related forfeiture cases.  In all, the United States will have recovered or assisted in the recovery of more than $1 billion in assets associated with the IMDB scheme.

That remarkable sum represents not only the largest recovery to date under the Kleptocracy Initiative, but also the largest civil forfeiture ever concluded by the Justice Department.  And we did so by working closely with our able counterparts in the United States Attorney’s Office in Los Angeles, who also contributed extensively to this effort. 

These prosecution numbers and case achievements in foreign corruption matters are in line with the overall trend of white collar enforcement in the Criminal Division. 

So far this year, the Fraud Section has brought charges against more than 440 individuals, which is an all-time high that will only increase through the close of the year. 

And by the end of this week, the Section will have reached 16 corporate criminal resolutions this year. 

With these numbers in mind, it is fair to say that reports of the death of white collar enforcement at the Department are grossly exaggerated.

In citing the achievements of the past year, I would be remiss if I didn’t give credit where the credit is truly due – to the career prosecutors, law enforcement agents, and supervisors who have worked tirelessly over the past months and years to build and prosecute these cases. 

I also want to recognize a changing of the guard that happened over the last year.  The former head of the FCPA Unit, Dan Kahn, was promoted to Senior Deputy Chief of the Fraud Section. 

Over the last decade, Dan moved up steadily within the FCPA Unit, starting as a line Trial Attorney, then becoming an Assistant Unit Chief, and finally being promoted to head the FCPA Unit three years ago. 

Under Dan’s leadership, the Unit has prosecuted a record number of individuals, recovered billions of dollars in monetary penalties, and launched groundbreaking policy reforms.  I am very grateful that Dan was willing to bring his well-honed legal skills, keen judgement, and even-keeled temperament to Fraud’s front office, where his talents will be brought to bear to benefit the entire Section, not just our FCPA program.

Dan leaves behind big shoes to fill.  The new head of the FCPA Unit is Chris Cestaro, a longtime veteran prosecutor and supervisor within the Unit.  Chris is a thoughtful leader and dedicated public servant. 

He has worked alongside Dan for many years, and I am confident that the FCPA Unit will continue to thrive under his excellent leadership.

For many years, conferences like this one have taken on outsized importance because there was so little case law that developed around the FCPA. 

Companies typically resolved matters through negotiation, and individuals were historically not prosecuted as vigorously as they are today.  And the Department was less transparent about how it reached the results it did.

As I’ve noted, the Department’s focus on individual accountability has led to more individual prosecutions.  Correspondingly, those prosecutions are now yielding jury trials and actual FCPA case law. 

At the rate we are going, in another ten years, the FCPA section in white collar crime textbooks will be chock full of judicial opinions with which to challenge law students via the Socratic method.

I want to highlight one such case, the prosecution and recent trial victory against Lawrence Hoskins.  As many of you likely recall, the Hoskins case earlier involved a consequential appeal and decision by the Second Circuit. 

I won’t go through that decision here – it has been fully debated and, indeed, I am told there was a mock oral argument about the case on this stage just two years ago. 

Instead, I want to talk about a different aspect of our case that has received a significant amount of attention.  Namely the Department’s use of agency liability to prosecute Mr. Hoskins for violating the FCPA.

Before getting into that discussion, let me provide a very brief summary of the Hoskins case for the small handful of you here who might be unfamiliar with it.  In doing so, I realize this is a very specialized conference and deeply knowledgeable audience, so this is a bit like summarizing Hamlet at a Shakespeare convention. 

Lawrence Hoskins is a U.K. national, who was employed at a European subsidiary of Alstom S.A., and served as a senior vice president of the International Network division of the company. 

He was convicted last month of helping to carry out a massive bribery scheme to obtain a $118 million contract from a state-owned utility in Indonesia. 

And this is the part that matters in particular for my remarks today on agency:  He participated in this bribery scheme to secure the contract for Alstom’s U.S. subsidiary, Alstom Power, Inc., as well as another partner on the project. 

Another important detail is that Hoskins never personally took any of his actions related to the bribery conduct within the United States.

The government’s prosecution theory, which resulted in the conviction, was that Hoskins violated the anti-bribery provisions of the FCPA through his actions as an agent of Alstom Power, Inc., a U.S. domestic concern. 

Some observers have raised concerns about how the Department might pursue agency-based FCPA cases after Hoskins.  I hope to dispel some of those concerns today.

First, it is important to keep in mind that each of the FCPA’s three jurisdictional components reach conduct by “any officer, director, employee, or agent” of entities covered by those provisions.  This has been black letter statutory law for more than two decades. 

Accordingly, the use of agency principles in FCPA prosecutions is far from controversial, whether applied to the Act’s issuer provisions (15 U.S.C. § 78dd-1), domestic concern provisions (15 U.S.C. § 78dd-2), or U.S. territorial conduct provisions (15 U.S.C. § 78dd-3).  Indeed, in its decision last year, the Second Circuit wrote that the government’s agency theory of prosecution was “squarely within the terms of the statute.”  That is something with which I wholeheartedly I agree.

With that said, some of the concerns that have been voiced are not lost on me.  Not too long ago, I was a lawyer in private practice.  I know that the hardest questions to answer aren’t the ones that fall “squarely within the terms of the statute[,]” but those at the outer edges.

I want to be clear today that the Department is not looking to stretch the bounds of agency principles beyond recognition, or even push the FCPA statute towards its outer edges. 

For example, the Criminal Division will not suddenly be taking the position that every subsidiary, joint venture, or affiliate is an “agent” of the parent company simply by virtue of ownership status.  Conversely, we will also not be taking the position that every parent company should automatically be held liable for the acts of its subsidiaries, joint ventures, or affiliates based on an agency theory.  Simply put, the law requires more.

Each case and application of agency liability will need to be evaluated on its own and be based on a provable facts that align with agency principles. 

In this regard, the district court’s jury instruction in Hoskins is, well, instructive.  There, the jury was called upon to evaluate Hoskins’ conduct to look for proof of an agency relationship and control by the principal. 

Additionally, the court made clear that a person or entity may be an agent for some business purposes and not for others.  This meant that the government needed to prove that Hoskins was an agent of a domestic concern in connection with the specific events related to the project at issue. 

Before pursuing an FCPA case based on an agency theory, whether as to an individual or a company, the Department will need to measure the facts against the legal standard articulated by the court.  And our prosecutors will need to be confident that their evidence will be able to carry the government’s burden of proof at trial.  These are no small things. 

Aside from the law, the Department and its prosecutors must always exercise appropriate prosecutorial discretion. 

Where the evidence supports a finding of agency between a parent and a subsidiary, or for an individual, we will assess whether it is appropriate to exercise our discretion to apply the principle in that case. 

In exercising that discretion, our prosecutors will look to the factors they consider in every case under the Department’s Principles of Federal Prosecution of Business Organizations, as well as under the FCPA Corporate Enforcement Policy. 

Those factors are ones that are familiar to everyone in this room – the nature and seriousness of the offense, the pervasiveness and involvement of high-level executives in the misconduct, and whether the company voluntarily disclosed the misconduct, fully cooperated, and took timely and appropriately remedial actions. 

That said, I want to be very clear on one important point:  if the Department were to find evidence of the use of corporate structures to shield a parent from criminal liability, or the use of agents to shield a high-level individual executive from accountability, the Department likely would strongly favor prosecution in those instances. 

My remarks today regarding agency are intended to provide a window into the Department’s thinking and approach to cases.  Although many aspects of prosecutors’ work must be kept confidential, there is no need for there to be a black box around the principles and policies that guide our decisions. 

I actually believe a black box approach can stand in the way of the Department’s goals and mission.

For example, it is not in the Criminal Division’s interest to be opaque about the factors we want our prosecutors to consider when evaluating corporate compliance programs.  We want the corporate community to invest heavily in compliance, and do so efficiently and effectively. 

Strong corporate compliance programs and cultures not only detect misconduct, but they can also have a strong deterrent effect on those who might be tempted to violate laws or corporate policies.  These by-products of strong compliance align with the Criminal Division’s goals and mission.   

Nonetheless, you can imagine a company that is considering an investment in improved control systems to augment other aspects of its compliance program.  The new controls may flag misconduct that has previously gone undetected, giving rise to a greater sense of legal exposure – or at least known legal exposure. 

This sense of increased risk may then create resistance to the project from within the company. An important compliance program improvement is then never undertaken, and certain misconduct then goes unchecked, unless and until the Department happens upon it.  That is not the outcome we want.

Our policies need to be designed and communicated in a way that helps companies trust they are making the right investments.  It has been my goal since I arrived to foster and increase that trust, and I think the Department and the Criminal Division have made great strides in that regard. 

In publishing the Criminal Division’s compliance evaluation guidance earlier this year, we sought to convey to the bar and the corporate community that we place a significant value on compliance program investment and improvement, and that we will approach compliance program evaluation in a thoughtful way that is guided by much more than 20/20 hindsight. 

We reinforced the guidance through enhanced compliance training for our prosecutors, giving them a more sophisticated understanding of compliance program design and the challenges to effective implementation.  And that training will continue.

Through our monitorship selection policy, we have encouraged companies to make strong remedial investments in their compliance programs after misconduct is discovered by signaling through the policy that such investments will weigh against the imposition of a monitor.

And the Department’s improved voluntary self-disclosure guidance and policy against piling-on speak to the risk that an improved compliance program may ferret out otherwise unseen misconduct.  The FCPA Corporate Enforcement Policy lets companies know that, if a problem is discovered, there is a means for self-disclosing it in a way that mitigates risk in concrete ways.  

The piling-on policy seeks to contain risk in other ways, helping to foster greater trust that companies will be treated fairly, if a problem is detected. 

In speaking about our policies, I use the word “trust” for a reason.  Whether our policies are designed to incentivize or deter certain behaviors, or to pull back the veil to demystify processes or clear away confusion, they can only be effective if they are trusted. 

For that reason, the Criminal Division will continue to demonstrate our adherence to and application of our policies by our actions, including in press statements, public resolution documents, and program-related declinations.  After all, in law as in life, actions speak louder than words.

As we all know, policies can be changed at the drop of a hat by successive Department leaders and successive Administrations.  But good policies tend to survive beyond the tenures of those who helped make them, and they can serve as building blocks for further refinement.

I hope that is what we have been doing in this space for the last few years – making worthwhile refinements to existing policies and developing our own building blocks for the future. 

Time will tell whether this work will endure, and conferences like this exist in large measure for experts like you to help us understand whether we are going in the right direction.     

Thank you for your time and attention this morning, and I look forward to further dialogue on these important issues, including in the Q and A that will follow.

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Author: December 4, 2019

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Justice Department Settles Texas Disability-Based Housing Discrimination Lawsuit

A Texas apartment developer and a Texas site engineer have agreed to settle a federal lawsuit alleging they violated the Fair Housing Act (FHA) and the Americans with Disabilities Act (ADA). The suit alleged that they built an eight-building addition and associated rental office at the Seasons Resort in Galveston, Texas, that were inaccessible to persons with disabilities. 

“The Fair Housing Act and the Americans with Disabilities Act require that new multifamily housing be accessible to persons with disabilities,” said Assistant Attorney General Eric Dreiband for the Civil Rights Division. “This lawsuit and its resolution help ensure that individuals with disabilities and their families live with dignity and enjoy equal housing and all other opportunities available to the people of the United States.”

“There is no place in our community for violating the ADA and FHA,” said U.S. Attorney Ryan K. Patrick for the Southern District of Texas. “Our Office is committed to enforcing these to ensure that every person with a disability has full access to residential buildings within our district.”

Today’s settlement, pending court approval resolves a lawsuit the Department filed in February 2019. It alleged that Galveston developer TFT Galveston Portfolio LTD and site engineer James W. Gartrell Jr. violated the FHA and the ADA when they designed and constructed an eight-building addition and associated rental office at the Seasons Resort in 2003 with steps and other features that made them inaccessible to persons with disabilities.

Under the terms of the settlement, Galveston Portfolio must take corrective actions such as removing steps, replacing steeply-sloped walkways and adding accessible parking to make public and common use portions of the property accessible to persons with disabilities, including wheelchair users. They must also construct a new apartment building with 24 accessible units, as well as a new accessible rental office, and establish a $75,000 settlement fund for people who suffered harm due to – the lack of accessible features at the Seasons Resort. The settlement also requires that Galveston Portfolio and Gartrell obtain training on the requirements of the FHA and ADA and ensure any future housing they design or construct complies with FHA and ADA requirements.

Persons who lived at or sought to live at the Seasons Resort who were denied housing or otherwise harmed because the complex was not accessible may be entitled to monetary compensation through today’s settlement. Such persons can contact the Justice Department toll-free at 1-800-896-7743 mailbox # 94 or by email at fairhousing@usdoj.gov.

The Fair Housing Act prohibits discrimination in housing based on disability, race, color, religion, national origin, sex and familial status. Among other things, the Fair Housing Act requires all multifamily housing constructed after March 12, 1991, to have basic accessibility features, including accessible routes without steps to all ground-floor units. The Americans with Disabilities Act requires, among other things, that places of public accommodation, such as rental offices at multifamily housing complexes designed and constructed for first occupancy after Jan. 26, 1993, be accessible to persons with disabilities. 

More information about the Civil Rights Division and the laws it enforces is available at www.usdoj.gov/crt. Individuals who believe that they have been victims of housing discrimination may call the Justice Department at 1-800-896-7743, e-mail the Justice Department at fairhousing@usdoj.gov, or contact the U.S. Department of Housing and Urban Development at 1-800-669-9777 or through its website at https://www.hud.gov/program_offices/fair_housing_equal_opp/online-complaint.

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Author: December 4, 2019

California CEO and Seven Others Charged in Multi-Million Dollar Conduit Campaign Contribution Case

Earlier today, an indictment was unsealed against the CEO of an online payment processing company, and seven others, charging them with conspiring to make and conceal conduit and excessive campaign contributions, and related offenses, during the U.S. presidential election in 2016 and thereafter.

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and Assistant Director in Charge Timothy R. Slater of the FBI’s Washington Field Office made the announcement.

A federal grand jury in the District of Columbia indicted Ahmad “Andy” Khawaja, 48, of Los Angeles, California, on Nov. 7, 2019, along with George Nader, Roy Boulos, Rudy Dekermenjian, Mohammad “Moe” Diab, Rani El-Saadi, Stevan Hill and Thayne Whipple. The 53 count indictment charges Khawaja with two counts of conspiracy, three counts of making conduit contributions, three counts of causing excessive contributions, 13 counts of making false statements, 13 counts of causing false records to be filed, and one count of obstruction of a federal grand jury investigation. Nader is charged with conspiring with Khawaja to make conduit campaign contributions, and related offenses. Boulos, Dekermenjian, Diab, El-Saadi, Hill, and Whipple are charged with conspiring with Khawaja and each other to make conduit campaign contributions and conceal excessive contributions, and related offenses.

According to the indictment, from March 2016 through January 2017, Khawaja conspired with Nader to conceal the source of more than $3.5 million in campaign contributions, directed to political committees associated with a candidate for President of the United States in the 2016 election. By design, these contributions appeared to be in the names of Khawaja, his wife, and his company. In reality, they allegedly were funded by Nader. Khawaja and Nader allegedly made these contributions in an effort to gain influence with high-level political figures, including the candidate. As Khawaja and Nader arranged these payments, Nader allegedly reported to an official from a foreign government about his efforts to gain influence.

The indictment also alleges that, from March 2016 through 2018, Khawaja conspired with Boulos, Dekermenjian, Diab, El-Saadi, Hill, and Whipple to conceal Khawaja’s excessive contributions, which totaled more than $1.8 million, to various political committees. Among other things, these contributions allegedly allowed Khawaja to host a private fundraiser for a presidential candidate in 2016 and a private fundraising dinner for an elected official in 2018.

The indictment further alleges that, from June 2019 through July 2019, Khawaja obstructed a grand jury investigation of this matter in the District of Columbia. Knowing that a witness had been called to testify before the grand jury, Khawaja allegedly provided that witness with false information about Nader and his connection to Khawaja’s company. Boulos, Diab, Hill, and Whipple also are charged with obstructing the grand jury’s investigation by lying to the FBI.

Currently, Nader is in federal custody on other charges.

An indictment is not a finding of guilt. It merely alleges that crimes have been committed. A defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.

The FBI’s Washington Field Office is investigating the case and Deputy Chief John D. Keller and Trial Attorneys James C. Mann and Michael J. Romano of the Criminal Division’s Public Integrity Section are prosecuting the case.

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Author: December 3, 2019

Justice Department Announces Settlement With Liberty Tax Service

The Justice Department announced today that it has filed a complaint with a U.S. District Court in Norfolk, Virginia, seeking entry of a court order requiring Franchise Group Intermediate L 1 LLC, (Liberty) the national franchisor and owner of Liberty Tax Service stores, to refrain from specific acts, enact enhanced internal compliance controls regarding the detection of false tax returns, and pay for an independent monitor to oversee Liberty’s compliance with the proposed court order. Separately, the United States and Liberty filed a joint motion and proposed order that, if adopted by the court, would resolve the matter.

Liberty is one of the largest tax preparation service providers in the United States, according to its public filings. Through its stores, Liberty filed approximately 1.3 to 1.9 million tax returns each year between 2015 and 2019, and for tax years 2012 to 2018, Liberty claimed over $28 billion in federal tax refunds on behalf of its customers, the complaint asserts. According to Liberty’s 2019 Annual Report filed with the SEC, and as reflected in the complaint, the Justice Department has been investigating Liberty’s policies, practices and procedures in connection with Liberty’s tax return preparation activities. Liberty has cooperated to resolve this matter.

The complaint alleges that Liberty directly controls its company-owned stores and that it maintains a substantial degree of control over franchisees. According to the complaint, returns prepared by franchisees and filed electronically with the IRS flow through Liberty before they are filed. The government claims Liberty failed to maintain adequate controls over tax returns prepared by its franchisees, and failed to take steps to prevent the filing of potentially false or fraudulent returns prepared by franchisees, despite having the capability to do so and despite notice of fraud at some of its franchisee stores.

Between 2013 and 2018 the Department of Justice filed 10 separate civil enforcement actions against Liberty Tax Service franchisees, or their owners, former owners or managers, some of whom Liberty designated as “Elite 18” franchisees because their “performance and attitude set the standard for the [Liberty Tax Service] organization.” The government contends its allegations in those lawsuits show common patterns across top Liberty franchisees of concocting fictitious income for customers to claim Earned Income Tax Credits, fabricating expenses to reduce customers’ reported income tax liability, claiming improper or false dependents, and falsifying education expenses to claim refundable education tax credits.

In their joint motion, the parties request relief that would:

  • Permanently bar Liberty from engaging or employing certain individuals going forward, including the company’s founder and former CEO, John T. Hewitt;

and require Liberty to:

  • Implement enhanced compliance measures, including training programs and additional resources to monitor, detect, and report non-compliance with federal laws and regulations, as well as to ensure effective quality control over tax return preparation throughout the Liberty Tax Service system;
  • Conduct a minimum number of onsite compliance reviews of its stores, test its stores’ compliance with tax laws using mystery shoppers, and automatically prevent electronic transmission of tax returns to the IRS that report certain items with a high risk of fraud until the company independently verifies the accuracy of the tax return;
  • Disclose to the United States any violations Liberty discovers from onsite reviews, mystery shoppers, and automatic holds of tax returns, as well as internal reviews Liberty previously conducted of its officers and employees who violated federal tax laws;
  • Enact specific verification requirements at Liberty Tax Service stores for tax returns that claim itemized tax deductions or report certain forms of income to claim the Earned Income Tax Credit;
  • Maintain a whistleblower program to encourage Liberty employees, franchisees, and franchisee employees to report suspected fraudulent activity; and
  • Engage a third party, approved by the United States, to act as an independent monitor to review the company’s compliance with terms of the order, to assess the sufficiency of Liberty’s fraud prevention measures, and to report findings to a government official designated by the United States and, if necessary, to the court.

Return preparer fraud is one of the Internal Revenue Service’s (IRS) Dirty Dozen Tax Scams for 2019. The IRS has some tips on their website for choosing a tax preparer and has launched a free directory of federal tax preparers. In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.

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Author: December 3, 2019

Four Gangster Disciples Sentenced Following Seven-Week Jury Trial

Following a seven-week jury trial in U.S. District Court earlier this year, a federal jury convicted five members of the Gangster Disciples of multiple counts relating to a racketeering conspiracy and a drug distribution conspiracy, which plagued the Clarksville, Tennessee, area with violence and murders for more than a decade, announced Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and U.S. Attorney Don Cochran for the Middle District of Tennessee.

Marcus Termaine Darden, aka, “Tuff,” 41, and Elance Justin Lucas, aka, “Mac Luke,” 30, both of Guthrie, Kentucky; Derrick Lamar Kilgore, aka, “Smut,” 35, and DeCarlos Titington, aka, “Los,” 44, both of Clarksville, Tennessee, were convicted at trial.

Following sentencing hearings that began last week and concluded today, Chief U.S. District Judge Waverly D. Crenshaw, Jr. sentenced Darden, Kilgore, Titington and Lucas to 40 years, 35 years, 22.5 years, and 20 years in prison, respectively. 

Of the 12 individuals charged in this conspiracy, five previously pleaded guilty, including Rex Whitlock, aka “Stackhouse,” 34, of Clarksville, who was sentenced in January to 30 years in federal prison, and Lorenzo Brown, aka “Zo,” of Murfreesboro, Tennessee, who was sentenced in November to 15 years in federal prison. 

According to evidence and testimony at trial, the defendants are all members of the Gangster Disciples, a criminal organization that originated in Chicago and spread through the midwestern and eastern United States. During a portion of the conspiracy, Darden was the “regent” of the “615 region” of the Gangster Disciples, making him the highest-ranking member of the gang in the middle Tennessee area. In that role, Darden exercised control over Gangster Disciples activities in Clarksville, Nashville, Murfreesboro, and Gallatin, among other cities. Darden also reported to a statewide “governor” of the Gangster Disciples.

Members of the Gangster Disciples criminal enterprise engaged in acts of violence including murder, attempted murder, witness intimidation, and obstruction of justice. These members also sold powder cocaine, crack cocaine, marijuana, and other controlled substances, and exercised control over certain territories in Clarksville. As part of the conspiracy, each defendant agreed that a member would commit at least two acts of racketeering activity for the Gangster Disciples.

The evidence at trial proved that the defendants and other members of the Gangster Disciples murdered members of the rival Bloods gang in Clarksville, including Hairston, in September 2007. The evidence also showed that, in January 2006, and as part of the Gangster Disciples’ effort to consolidate power in Clarksville, Darden shot a rival Crips gang member, who was life-flighted to Vanderbilt Medical Center for treatment. In December 2007, Darden also shot an unarmed person in the parking lot of a nightclub because that individual had “disrespected” him. These defendants were also responsible for a drive-by shooting in Clarksville in August 2014, targeting members of the rival Vice Lords gang.  During this shooting, members of the Gangster Disciples, including Kilgore, rode through a residential neighborhood and began firing AK-47 style assault weapons.  During this incident, four innocent bystanders, including a 16-year-old, were struck by gunfire and were transported to a local hospital for treatment.  One woman was shot three times in the abdomen and suffered serious, life threatening injuries.

Titington also attempted to shoot and kill two members of the rival Vice Lords gang after a brawl inside a convenience store in Clarksville in December 2014.  During this incident, Titington fired 14 rounds from a Glock semi-automatic handgun, striking a vehicle occupied by rival Vice Lord gang members.  Titington pleaded guilty to this conduct in state court, and although he was acquitted of federal attempted murder in aid of racketeering charges in connection with this conduct, he was convicted on a racketeering conspiracy charge which encompassed this conduct.

These violent acts were intended to further the gang’s activities and maintain and increase a member’s position within the organization. Evidence at trial also established that the defendants engaged in witness intimidation through violence or threats of violence, and prevented or deterred individuals from cooperating with law enforcement. Additionally, the government introduced evidence and testimony showing that law enforcement officers conducted undercover buys of cocaine and crack cocaine from Darden, Burks, Kilgore and Lucas between 2010 and 2015.  During this investigation, law enforcement also seized numerous firearms, controlled substances, and other contraband.

This extensive investigation was conducted by the Bureau of Alcohol, Tobacco, Firearms, and Explosives; the Tennessee Bureau of Investigation; the Montgomery County Sheriff’s Office; the Clarksville Police Department; the Rutherford County Sheriff’s Office; the Murfreesboro Police Department; the Gallatin Police Department; the Kentucky State Police; the 19th Judicial District Drug Task Force; and the Hopkinsville, Kentucky Police Department.  Assistant United States Attorney Ben Schrader of the Middle District of Tennessee and Trial Attorneys Shauna Hale and Ivana Nizich of the Criminal Division’s Organized Crime and Gang Section, are prosecuting the case. 

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Author: December 3, 2019

Justice Department Honors Law Enforcement Officers and Deputies in Third Annual Attorney General’s Award for Distinguished Service in Policing

Attorney General William P. Barr and Justice Department leadership today announced the recipients of the Third Annual Attorney General’s Award for Distinguished Service in Policing, recognizing the exceptional work of 19 law enforcement officers and deputies from 12 jurisdictions across the country.

“Honoring and supporting the work of law enforcement of­ficers and deputies is a top priority for the Trump Administration, and today is an opportunity for me to personally express my gratitude and commitment to those who risk their lives daily to protect our communities,” said Attorney General Barr. “The Attorney General’s Award for Distinguished Service in Policing honors exceptional police officers and the vital public service they provide. The brave men and women in law enforcement are engaged in an unrelenting and often unacknowledged fight to keep our communities safe each and every day. It is an honor to thank them for their service.”

President Donald J. Trump established clear directives for the Department of Justice – with three Executive Orders – demonstrating his strong support of the law enforcement community. These Executive Orders commit the Department to working in tandem with state and local law enforcement to restore the rule of law, reduce violent crime, dismantle criminal gangs, and combat the growing drug epidemic. Today the Department of Justice continues to support the President’s directive to honor law enforcement officers by announcing the third annual Attorney General’s Award for Distinguished Service in Policing.

The Attorney General’s Award recognizes individual state, local, and tribal sworn rank-and-file police officers and deputies for exceptional efforts in policing. The awarded officers and deputies have demonstrated active engagement with the community in one of three areas: criminal investigations, field operations or innovations in community policing. The Department received 199 nominations for 414 individuals ranging from state police departments, to local police, to campus public safety agencies. This award highlights the work that troopers, officers and deputies do to prevent, intervene in, and respond to crime and public safety issues. The individuals recognized today include:

CRIMINAL INVESTIGATIONS

Detective William Maldonado of the Suffolk County Police Department, New York:

Detective William Maldonado is being recognized posthumously for his effort in leading the criminal investigation into the violent trans­national street gang MS-13. Detective Maldonado was assigned to assist in the investigation of the disappearance of a young man. Intelligence gathered by Detective Maldonado indicated the missing boy was a murder victim of MS-13. Without the detective’s work, along with his team, the murder spree would no doubt have continued. Instead, several dozen people were arrested, charged with 17 murders, the Suffolk County MS-13 Sailor Clique was eliminated, and several other cliques were disrupted. Maldonado accomplished this while battling cancer, and rarely missed work. He succumbed to his illness in 2018, but not before arrests were made in the cases.

Detectives George Duarte and Jeffrey Richards of the Providence Police Department, Rhode Island:

Detectives George Duarte and Jeffrey Richards are being recognized for their extraordinary investigative work in solving an abduction and sexual assault case of a 14-year-old girl. Their investigation not only solved that case, but also led to solving several other cases of sexual assault by the same suspect. Because of their work, the detectives were able to have this vicious predator removed from the community, victims of unreported crimes were helped, and justice was brought to a number of other victims.

Detectives Sandra Marquez and Kenneth Sealy of the Aventura Police Department, Florida:

Detectives Kenneth Sealy and Sandra Marquez are being recognized for their investigative work in solving several high-dollar fraud schemes targeting multiple businesses and retail stores. During an intense investigation involving a large credit card fraud ring operating in south Florida, the detectives identified approximately $194,000 in fraudulent transactions and seized another $218,000. Another case involved money laundering and widespread credit card fraud committed in multiple states, which included a loss of almost $4 million over three years. The detectives are continuing this important work in coordination with several federal agencies.

FIELD OPERATIONS

Officers Evan Jurgensen, Nicholas Kelly, Rachel Mynier, and John Yenchak of the Prince William County Police Department, Virginia:

In November 2018, the Prince William County Police Department received a call reporting an active shooter. Within minutes of responding to the scene, Officers Jurgensen, Kelly, Mynier and Yenchak had to take cover from gunfire. Officer Mynier noticed movement on the roof of a residence and transmitted a warning to incoming units, and in doing so saved lives. After the shooter ignored officers’ commands, he was eventually struck and fell to the ground. Although officers feared a possible second shooter, they exposed themselves to harm once again to extract the shooter for medical treatment, and also pulled an occupant from the residence to safety. The heroism demonstrated by each officer represents true courage.

Deputy Richard Hassna of the Alameda County Sheriff’s Office, California:

Deputy Richard Hassna is being recognized for his innovative use of small unmanned aerial systems (UAS) for public safety operations. In 2018, during the deadly Camp Fire in Butte County, Deputy Hassna led more than 16 unmanned aerial vehicle teams, and conducted 517 flights in two days, taking more than 70,000 images. These images were stitched into a map that allowed residents to see the damage to their property, without being exposed to danger. This was likely the largest response of small UAS’s to a disaster scene in U.S. history. Deputy Hassna has also developed tactics and training for this technology that has redefined high-risk tactical operations and air support as we know it.

Deputy Ross Jessop of the Missoula County Sheriff’s Office, Montana:

Deputy Jessop is being recognized for his action and dedication to duty in saving the life of a kidnapped baby. In July 2018, the Sheriff’s Office received a call about a man with a gun, who had fled in a vehicle with his girlfriend’s infant son. One hour later the suspect appeared back on the scene without the baby. The suspect said he killed and buried the baby; but his irrational statements led investigators to search for the missing child. During Deputy Jessop’s search in more than a million acres of forest, he heard a faint whimper, and found a baby boy lying face down. To his surprise, the baby was alive and uninjured. There is no question Deputy Jessop’s  instincts, perseverance, and dedication saved the child’s life.

Officers Aaron Bates and Alexander Stotik of the Cohasset Police Department, Massachusetts:

Officers Bates and Stotik are being recognized for their courageous actions that saved the life of a woman who was being brutally attacked. The officers were dispatched to a home where neighbors complained of loud noises and a fight. After investigating, the officers heard a muffled scream, kicked in a locked door, and saw what they described as an “attempted murder in progress.” After a heated struggle, the officers were able to subdue the suspect, place him under arrest, and get medical attention for the victim. The officers exhibited extraordinary valor, bravery, courage, and professionalism in the face of extreme danger that would no doubt have resulted in the murder of the victim.

INNOVATIONS IN COMMUNITY POLICING

Officer Phalon McFate of the Las Vegas Metropolitan Police Department, Nevada:

Officer McFate developed Project Daybreak, an initiative used to address violent crime-hot spots in downtown Las Vegas neighborhoods. Since it started, Project Daybreak has significantly contributed to decreasing violent crime – down by 50 percent in these neighborhoods. Through positive police interactions, Officer McFate was able to create transparency and build trust in neighborhoods, where these previously did not exist. The success of Project Daybreak is a direct result of Officer McFate’s passion and commitment to her community.

Officer Jesse Guardiola of the Tulsa Police Department, Oklahoma:

Officer Guardiola is being recognized for the Hispanic outreach program he has developed, which provides survival Spanish language training, and educates law enforcement and the community on the immigrant Hispanic culture. The program has received national recognition and is being promoted as a national model for Hispanic community outreach. Through his efforts, Officer Guardiola is building bridges and making a difference in Tulsa, Oklahoma.

Detective Anthony Roberson of the Providence Police Department, Rhode Island:

Detective Roberson is being recognized for his use of community policing initiatives that build partnerships between law enforcement and local businesses to support underserved families.  The “Shop with a Cop” program has now served 300 children.  The “Handshake Initiative” has grown from 40 to 200 mentors, and is benefiting families of all backgrounds, across the city. Through these programs, Detective Roberson is giving back to his community, increasing partnerships and building bridges between law enforcement, families and businesses. 

Officer Jonathan Plunkett of the Irving Police Department, Texas:

In August 2016, after the murder of five police officers in Dallas, Officer Plunkett began working on an outreach initiative to bridge the gap between the African-American community and law enforcement. The idea was to connect with the community in places where residents would feel comfortable, and be open to sharing their concerns and engaging in dialogue. Officer Plunkett knew that barbershops would work.  The initiative, which began with one shop, has now increased to 16 shops, and is known as ShopTalk. Through ShopTalk, Officer Plunkett has created a way to build mutual trust and respect between law enforcement and community members who had not been reached with traditional police outreach efforts.

Detective Kathleen Lucero of the Isleta Tribal Police Department, New Mexico:

Detective Lucero is being recognized for community policing initiatives that provide resources to impoverished youth, and build connections between law enforcement and the community. Through the annual Reaching for A Star initiative, Detective Lucero provides gifts and food to more than 150 children and their families during the holiday season. Through her Camp Courage program, 60 children participate in a youth camp every summer. Detective Lucero’s on-and off-duty dedication cannot be overstated and has made a true impact on the community. 

Officer Troy Quick of the Conyers Police Department, Georgia:

Officer Quick is making a lasting impact on the youth within his community. As a School Resource Officer at Rockdale County High School, Officer Quick has been able to help a number of students leave gang life. Whether it is though the mentoring sessions he coordinates for students, donating items to families in need, or just taking an interest in student’s daily lives, Officer Quick is a true example of dedication and service.

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Author: December 3, 2019

International Counterterrorism Officials Share Good Practices on Community-Oriented Policing for Countering Violent Extremism

International senior counterterrorism (CT) officials, academic experts, U.S. interagency representatives, and organizations dedicated to policing initiatives and extremism topics met in Washington, DC from Dec. 2 to 4, to openly discuss and address current knowledge on community-oriented policing for countering violent extremism (CVE) to further improve mutual exchanges and better connect multilateral cooperation and national implementation of CT and CVE practices.

The meeting, convened by the U.S. Department of Justice’s International Criminal Investigative Training Assistance Program (ICITAP) of the Department’s Criminal Division, the U.S. Department of State’s Bureau of Counterterrorism, Hedayah, and the Global Center on Cooperative Security in cooperation with the U.S. Institute of Peace (USIP), provided the opportunity for senior officials to launch two joint publications of USIP and Hedayah funded by the Bureau of Counterterrorism, and also to further strengthen implementation of CT and CVE good practices and responses to terrorism and violent extremism.

In the meeting, USIP and Hedayah presented the results of two programs, Community-Oriented Policing for CVE Capacity and Positive Policing Messages: Countering Violent Extremism Narratives.  These works, published by Hedayah, represent the efforts of various international partners along with the two organizations in order to establish a framework for policing for CVE and to emphasize the importance of systematic communication by law enforcement with the community.

The meeting also addressed topics of mutual interest, including the challenges of policing certain rural and urban areas, new trends in terrorism, women in policing, police academies, strategic communications by law enforcement as part of a strategy to counter violent extremism, and new methods of responding to potential terrorists, as well as probationary and corrections programs.  In addition, ICITAP presented a toolkit based upon community-oriented policing and standardized incident management systems providing multiple examples of how law enforcement can engage the community to create resilience and prevent terrorism, respond to incidents effectively through pre-planning and communications, and dedicate resources to the community and police recovery after a traumatic incident, in addition to justice solutions for offenders.

“ICITAP is proud to partner with the Department of State’s Bureau of Counterterrorism and other key members of the U.S. and international community to counter threats of violent extremism around the globe,” said Gregory Ducot, the Acting Director of ICITAP.  “This three-day Policing for Countering Violent Extremism Symposium serves as a forum for ICITAP to bring theory to practice, analyze the drivers of violent extremism, and share field-tested tools that have been utilized effectively throughout the world.  By bringing together experts committed to preventing and countering extremism, ICITAP anticipates that this symposium will lead to the assembly of a CVE community of interest, which will guide the interagency to more effectively combat the rise of violent extremism.”

The discussions in the meeting will inform upcoming international meetings on CVE, including one focused on women in policing.  

To learn more about ICITAP, visit: https://www.justice.gov/criminal-icitap.

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Author: December 3, 2019

Deputy Attorney General Jeffrey A. Rosen Delivers Remarks at the Cutting Edge Tactics for Threat Assessment, Mitigation, Disruption & Early Engagement Symposium (Deep Seminar)

Remarks as prepared for delivery

Good morning and thank you for that kind introduction.

On behalf of the Justice Department, and Attorney General Barr, thank you for taking time out of your busy schedules to participate in this event. The presentations and exchange of ideas set to take place over the next two days are of the highest importance. Hopefully they will help you develop new tools and tactics — and empower you to continue protecting the safety and well-being of your communities.

During recent years, our nation has been rocked by atrocious acts of senseless violence that have targeted our school children, our police officers, our workplaces, and our houses of worship. In the wake of these tragedies, America’s law enforcement community did what it always does: it stepped up.

Working collaboratively, federal, state and local law enforcement have been able to identify and neutralize many potential threats before innocent lives are lost. However, with officers facing a new, unique, and growing danger, not every act of violence can be stopped.

Today’s threats are different from the carefully planned terrorist attacks we have worked to thwart in the wake of 9/11. Violent individuals can appear abruptly, and are often driven by mental illness, or even substance abuse, making their actions especially unpredictable.

For this reason, it is so critically important that we take the expertise we’ve gained over the last twenty years fighting violent crime and terrorism and fuse it with an “all-tools” approach. This supplemental paradigm includes partnering with threat assessment professionals, clinical psychologists, and community leaders.

With your help, we can take all lawful measures to intervene when someone is mobilizing towards violence. This approach allows us to be proactive rather than reactive. We can do whatever is possible to disrupt and engage mass shootings, rather than responding after the fact.

Across the United States, components of the Department of Justice and its law enforcement partners have been developing and field-testing strategies to shield the American people from these dangerous individuals.

In Connecticut, the FBI worked with local law enforcement to follow up on a tip that someone was attempting to illegally transport high capacity magazines into the state. After investigating, authorities found that the individual had allegedly posted on social media about committing a mass shooting and arrested him in August on firearms charges.

Around the same time, a man in Florida sent his ex-girlfriend a stream of shocking text messages in which he allegedly discussed opening fire at a school with the goal of killing at least 100 innocent people. The ex-girlfriend contacted the authorities, who arrested the man, recovering a rifle and a stockpile of ammunition at his apartment.

In Fort Worth, Texas, a specially-trained crisis intervention team was able to prevent an unstable young man from buying a gun on the street after failing a background check. Police had been warned by the man’s father that the 27-year-old might be planning a mass shooting. Officers were able to avert the attack, and get the man the mental health care he needed.

In each case, the public saw the red flags, and our law enforcement professionals were able to handle the situation. But we can’t leave responding to tips up to chance, nor can we rely on tips alone. That’s why Attorney General Barr called for the implementation of national disruption and early engagement programs to counter the threat of mass shootings.

During this symposium, you will hear from law enforcement professionals and experts from places such as Brooklyn, Denver, San Diego, and Hawaii about how they are using the most cutting-edge techniques to assess threats and how they work with a variety of different partners to mitigate and disrupt those threats.  It is these types of creative approaches to combating violent crime that we as a Department want to encourage.    

And, that’s why events like this one are so important. Take this training conference as an invitation to be bold — to be innovative. Americans are looking to you, as they always do, to get out ahead of this problem, and to keep them safe. I have great faith in the people in this room and I look forward to hearing about your successes in the weeks and months ahead.

Thank you again for your time and for everything you do.

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Author: December 3, 2019

Department of Justice Announces Indictment Charging Russians, Italians and Others With Attempting to Evade Security Sanctions

A newly unsealed superseding indictment has charged Russian and Italian nationals, a U.S. citizen and various companies in a conspiracy to evade international trade sanctions.

The United States District Court for the Southern District of Georgia unsealed the superseding indictment on Dec. 2, 2019, charging two Russian nationals, two Italian nationals, a U.S. citizen, and various companies with violating and conspiring the violate the International Emergency Economic Powers Act (IEEPA) and the Export Control Reform Act of 2018 (ECRA), conspiracy to commit wire fraud, and conspiracy to commit money laundering.

The indictment, which was returned in October 2019 by a federal grand jury in Savannah, Georgia, charges Oleg Vladislavovich Nikitin; Nikitin’s Russian-based company KS Engineering (KSE); KSE employee Anton Cheremukhin; Gabriele Villone; Villone’s Italian-based company GVA International Oil and Gas Services (GVA); and GVA employee Bruno Caparini, with violating and conspiring to violate IEEPA/ECRA. Additionally, the aforementioned defendants, Dali Bagrou, and Bagrou’s U.S.-based company World Mining and Oil Supply (WMO) are charged with conspiracy to commit wire fraud and conspiracy to commit money laundering.  Nikitin, Villone, and Bagrou were all arrested in Savannah, Georgia, while attempting to complete the illegal transaction and are awaiting trial.

“This prosecution demonstrates the high priority the Department of Justice places on the enforcement of U.S. restrictions on exports to Russia’s oil and gas industry,” said Assistant Attorney General for National Security John C. Demers.  “The U.S. government imposed these restrictions following the Russian annexation of Crimea and its use of force in Ukraine. Russia continues to undermine democratic processes and institutions in that region and adversely affects our national security.”

“The defendants tried to defraud the United States by evading sanctions put in place to keep U.S. goods out of the hands of some of the world’s most dangerous actors,” said U.S. Attorney Bobby L. Christine for the Southern District of Georgia. “We will continue to prosecute to the fullest extent of the law those who threaten our national security.”

“Detecting, preventing, and prosecuting those who conspire to illegally export U.S. origin commodities to Sanctioned and Entity Listed companies, such as those involved in this case in Russia, remains a top priority for the Bureau of Industry and Security,” said Douglas R. Hassebrock, Acting Assistant Secretary for Export Enforcement.  “We are committed to bringing lawbreakers, who have willfully chosen to threaten our nation’s security, to justice.  And, as always, we are very grateful to work jointly with our enforcement partners.”

“The defendants in this case went to great lengths to circumvent export control laws enacted to protect our nation’s security,” said Cynthia A. Bruce, Special Agent in Charge of the Defense Criminal Investigative Service, Southeast Field Office. “The DCIS will aggressively support our law enforcement partners working to ensure protected items don’t fall into the wrong hands.”

“This brazen scheme to undermine United States sanctions was a direct threat to national security,” said Special Agent in Charge of FBI Atlanta, Chris Hacker. “But because of the tireless efforts of federal law enforcement partners, the deception ends and the first steps in bringing these defendants to justice begins.”

“U.S. Customs and Border Protection’s collaboration with our fellow federal law enforcement agencies is critical to the successful enforcement of U.S. import and export laws,” said Donald F. Yando, Director, Field Operations, Atlanta Field Office, U.S. Customs and Border Protection. “These partnerships provide for the successful identification and destruction of these types of criminal enterprises.”

According to the indictment, an unnamed Russian government-controlled business contracted with Nikitin and KSE to purchase a Vectra 40G power turbine from a U.S.-based manufacturer for approximately $17.3 million. The Vectra 40G was designed and manufactured for integration with gas generators to enable direct drive of high-power gas compressors. Evidence in the case established the intent of the Russian company to use the Vectra on a Russian Arctic deepwater (greater than 500 feet) drilling platform. For reasons of national security, the U.S. Department of Commerce expressly prohibited any unlicensed shipment or transfer of the Vectra to the Russian company for that purpose.

In an attempt to evade U.S. export laws, the indictment alleges that Nikitin, Cheremukhin and KSE hired Villone, Caparini and GVA to obtain the Vectra on their behalf. Villone, Caprini and GVA then employed the services of Bagrou and WMO to procure the Vectra from a U.S.-based manufacturer and to have the Vectra shipped overseas. The parties conspired to conceal the true end user of the Vectra from both the U.S. manufacturer and the U.S. government by submitting false documentation that stated the Vectra would be used by a U.S. company in and around Atlanta.

Nikitin, Cheremukhin, Villone and Caparini face a maximum sentence of 20 years in prison and a $1 million fine on the charge of violating IEEPA/ECRA and a maximum of five years in prison and a $250,000 fine for conspiracy to violate IEEPA/ECRA and to defraud the United States. Bagrou and the aforementioned defendants also face a maximum of 20 years in prison and a $500,000 fine on the charges of conspiracy to commit wire fraud and conspiracy to launder monetary instruments.

Criminal indictments contain only charges; defendants are presumed innocent unless and until proven guilty.

The Department of Commerce, Bureau of Industry and Security, Office of Export Enforcement, as well as the Defense Criminal Investigative Service and the Federal Bureau of Investigation investigated the case with assistance from the Georgia Department of Natural Resources and Customs and Border Protection. Assistant U.S. Attorneys Jennifer G. Solari and Steven H. Lee are prosecuting the case with Trial Attorney William A. Mackie of the National Security Division’s Counterintelligence and Export Control Section.

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Author: December 3, 2019

Justice Department Sues City of Hesperia, California and San Bernardino County Sheriff’s Department for Discriminating Against African American and Latino Renters Through the Enactment and Enforcement of a Rental Ordinance

The Justice Department today announced it has filed a lawsuit alleging that the City of Hesperia, California, and the San Bernardino County Sheriff’s Department in California discriminated against African American and Latino renters in violation of the Fair Housing Act.

The lawsuit filed in the U.S. District Court for the Central District of California alleges that the City, with substantial support from the Sheriff’s Department, enacted a rental ordinance with the intent of addressing what one City Councilmember called a “demographical problem” – the City’s increasing African American and Latino population – resulting in the evictions of numerous African American and Latino renters. The ordinance, which was in effect between Jan. 1, 2016 and its amendment on July 18, 2017, required all rental property owners to evict tenants upon notice by the Sheriff’s Department that the tenants had engaged in any alleged criminal activity on or near the property. The complaint further alleges that the Sheriff’s Department exercised its substantial discretion in enforcement to target African American and Latino renters and majority-minority areas of Hesperia. Although the ordinance purported to target “criminal activity,” the Sheriff’s Department notified landlords to begin evictions of entire families including children for conduct involving one tenant or even non-tenants, evictions of victims of domestic violence, and evictions based on mere allegations and without evidence of criminal activity.

“The Fair Housing Act prohibits local governments from enacting ordinances intended to push out African American and Latino renters because of their race and national origin, or from enforcing their ordinances in a discriminatory manner,” said Assistant Attorney General Eric Dreiband. “The United States Department of Justice will continue zealously to enforce the Fair Housing Act against anyone and any organization or institution that violates the law’s protections against race, national origin, and other forms of unlawful discrimination.”

“Our office is committed to defending the civil rights of everyone,” said Nick Hanna, the United States Attorney for the Central District of California. “Protecting the public is one of the most important duties of local governments and police departments, and the public entrusts them with enormous power to carry out that duty. We will not allow them to abuse that power by depriving people of their rights.”

“Individuals and families have a right to live where they choose, regardless of their race or national origin,” said Anna María Farías, Assistant Secretary for Fair Housing and Equal Opportunity at the U.S. Department of Housing and Urban Development (HUD). “HUD applauds today’s action and will continue to work with the Justice Department to address policies and practices that violate this nation’s fair housing laws.”  

The Justice Department’s lawsuit is based on an investigation and charge of discrimination by HUD, which found that African American and Latino renters were significantly more likely to be evicted under the ordinance than white renters, and that evictions disproportionately occurred in majority-minority parts of Hesperia. According to the complaint, HUD determined that African American renters were almost four times as likely as non-Hispanic white renters to be evicted because of the ordinance, and Latino renters were 29 percent more likely than non-Hispanic white renters to be evicted. Sheriff’s Department data showed that 96 percent of the people the Sheriff’s Department targeted for eviction under the ordinance in 2016 had lived in majority-minority Census blocks. HUD determined that reasonable cause existed to believe the city and county engaged in illegal discriminatory housing practices.

The lawsuit alleges that City officials enacted the ordinance to drive African American and Latino renters out of Hesperia. During city council hearings, city officials and others made numerous statements that demonstrate the City enacted the ordinance to reverse “demographic” changes in Hesperia, including focusing on purported newcomers from predominantly minority Los Angeles County. City officials expressed a desire for the ordinance to drive supposed newcomers “the hell out of our town.” The City enacted the ordinance despite civil-rights related objections to many of its provisions from various segments of the community.

The complaint alleges that, in addition to the eviction mandate, the ordinance required all rental property owners to register their properties and pay an annual fee; submit the names of all adult tenancy applicants to the Sheriff’s Department for a background screening, and use a commercially available service to conduct at their own expense a criminal background check of their tenants; and subject their rental properties to annual inspections by police. Failure to comply subjected owners to fines.

The lawsuit alleges that the Sheriff’s Department used the ordinance to target African American and Latino renters and tenants living in majority-minority areas of Hesperia. The United States’ complaint alleges that, in enforcing the ordinance, the Sheriff’s Department notified landlords to begin evictions of entire households for the conduct of a single individual, including in cases where tenants were victims of domestic violence. Those evicted included young children who were not accused of any wrongdoing.   

Fighting illegal housing discrimination is a top priority of the Justice Department. The Fair Housing Act prohibits discrimination in housing on the basis of race, color, religion, sex, familial status, national origin, and disability. More information about the Civil Rights Division and the laws it enforces is available at www.justice.gov/crt. More information about the Civil Rights Section, Civil Division of the United States Attorney’s Office for the Central District of California is available at https://www.justice.gov/usao-cdca/civil-division/civil-rights.

Individuals who believe that they may have been victims of housing discrimination can call the Justice Department at 1-800-896-7743 (press 1 to continue in English and select mailbox option 4; press 2 to continue in Spanish and select mailbox option 4), email the Justice Department at fairhousing@usdoj.gov, or contact HUD at 1-800-669-9777. Individuals can also file a complaint about housing discrimination or other civil rights violations with the Civil Rights Section, Civil Division of the United States Attorney’s Office by calling (213) 894-2879, emailing USACAC.CV-CivilRights@usdoj.gov, or completing and submitting this form.

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Author: December 2, 2019