Three defendants involved in a $4.4 million dollar federal prison sentencing scheme from Texas pled guilty this month in the Southern District of Florida.
Colitha Patrice Bush, 36, and Alvin James Warrick, 40, both of Beaumont, Texas, as well as Ronald Bennett Shepherd, 32, of Houston, Texas, each pled guilty to conspiracy to commit mail fraud and wire fraud, in connection with their participation in the multi-year fraud scheme. Warrick and Bush admitted guilty to a count of conspiracy to commit wire fraud in a related case originally brought in the Eastern District of Texas, and subsequently transferred to Florida.
According to court documents, from 2009 through 2016, Warrick, Bush, Shepherd, and others held themselves out as owners and operators of Private Services, a company that reportedly worked with a network of informants and law enforcement personnel to identify and provide information and third party cooperation that could be credited to federal inmates in “Rule 35” proceedings.
Using aliases such as “Peter Candlewood,” “Diane Lane,” and “Diane Rice,” they targeted federal inmates and their families by promising that they could provide substantial assistance services, which would be used to help secure the early release of the inmates. They required relatives of the inmates to make periodic payments via cash, check, wire, and electronic fund transfer, in order for the third party cooperation process to supposedly be conducted. Overall, more than $4.4 million was paid to the defendants by at least twenty-two victims.
Warrick and Bush made up fake invoices and fraudulent documents allegedly showing agreements between various U.S. Attorney’s Offices, including the Eastern District of New York and the Southern District of New York, and a company affiliated with Private Services. These fake documents included the forged signatures of prosecutors. There was no substantial assistance provided on behalf of the inmates. Instead, Warrick, Bush and Shepherd simply received payments from relatives of federal inmates, and used the fraudulently obtained funds for their personal use and benefit, including the purchase of luxury automobiles, vacations, and gambling activities.
Rule 35 of the Federal Rules of Criminal Procedure allows the court, upon the government’s motion, to reduce a defendant’s sentence if the defendant is found to have provided substantial assistance in investigating or prosecuting another person. Neither the government nor the court system charges inmates or their relatives a fee for requesting a sentencing reduction when an inmate provides substantial assistance.
Benjamin G. Greenberg, Acting United States Attorney for the Southern District of Florida, Robert A. Bourbon, Special Agent in Charge, Department of Justice, Office of the Inspector General (DOJ-OIG), and Perrye K. Turner, Special Agent in Charge, Federal Bureau of Investigation (FBI), Houston Field Office, made the announcement.
“Sentencing reduction fraud schemes that prey on the desperation, vulnerability and trust of federal inmates and their families exploit both the victims and the justice system,” stated Acting U.S. Attorney Benjamin G. Greenberg. “The U.S. Attorney’s Office in South Florida and our federal partners across the nation will continue to target such schemes and prosecute the offenders.”
“Conning relatives of federal inmates into thinking that they must pay money for their loved ones to receive a sentence reduction that is actually based solely on how much an inmate assists the government is an outrageous way to defraud innocent victims,” said Special Agent in Charge Robert Bourbon. “Even more importantly, it runs the risk of soiling the reputation of our federal criminal justice system, which prides itself on delivering just results, regardless of an individual’s wealth or access to those in power.”
Bush’s sentencing for both cases is scheduled for June 7, 2017, at 3:00 p.m. before U.S. District Judge Joan A. Lenard. Warrick’s sentencing is scheduled for May 31, 2017, at 3:00 p.m., and Shepherd’s sentencing is scheduled for May 24, 2017, at 3:00 p.m., also before U.S. District Judge Joan A. Lenard. The defendants each face a statutory maximum penalty of 20 years in prison as to each count.
“If you are a victim, it is critical that you reach out to us,” said FBI Special Agent in Charge Perrye K. Turner. “This case highlights that justice is blind and underscores the FBI’s impartiality when investigating cases.”