Governor Hochul Updates New Yorkers on State's Progress Combating COVID-19 - DECEMBER 15, 2022

 

Encourages New Yorkers to Keep Using the Tools to Protect Against and Treat COVID-19: Vaccines, Boosters, Testing and Treatment

27 Statewide Deaths Reported Yesterday

 Governor Kathy Hochul today updated New Yorkers on the state's progress combatting COVID-19 and outlined basic steps they can take to protect against the spread of viral respiratory infections that become more common in the fall and winter seasons. 

"With the holiday season upon us, I urge all New Yorkers to remain vigilant and continue to use all available tools to keep themselves, their loved ones and their communities safe and healthy," Governor Hochul said. "Stay up to date on vaccine doses, and test before gatherings or travel. If you test positive, talk to your doctor about potential treatment options."

Governor Hochul is urging New Yorkers to take common prevention measures — like staying up to date on vaccines and practicing proper hygiene — to protect from Respiratory Syncytial Virus (RSV), the flu and COVID-19 and reduce the patient burden on local hospitals. Last week, the Governor updated New Yorkers on the state's winter health preparedness efforts. 

Last week, the U.S. Food and Drug Administration and CDC also cleared the way for children six months of age and older to receive the bivalent booster shot to increase protection against COVID-19. Previously, these shots were only available to children ages 5 and older. 

The New York State Department of Health issued a report last week showing a 64 percent week-over-week jump in lab-confirmed flu cases across New York and week-over-week hospitalizations up 58 percent. Cases of influenza have now been detected in all 62 counties across the state, highlighting the need for New Yorkers to take steps and precautions that will reduce the risk of severe illness for children and adults.  

Governor Hochul previously launched a public awareness campaign featuring New York State Health Commissioner Dr. Mary T. Bassett speaking directly to New Yorkers about the three viruses now circulating in the state with similar symptoms and the potential to cause serious illness. Produced by the New York State Department of Health, the videos include a short clip and a longer version geared toward parents; and a version aimed specifically at health care providers. 

The Governor also asked New Yorkers to get their bivalent COVID-19 vaccine boosters. To schedule an appointment for a booster, New Yorkers should contact their local pharmacy, county health department, or healthcare provider; visit vaccines.gov; text their ZIP code to 438829, or call 1-800-232-0233 to find nearby locations. 

In addition, Governor Hochul encourages New Yorkers to get their annual flu vaccine as flu season is widespread across New York State. The flu virus and the virus that causes COVID-19 are both circulating, so getting vaccinated against both is the best way to stay healthy and to avoid added stress to the health care system. 

The State Department of Health is continuing its annual public education campaign, reminding adults and parents to get both flu and COVID-19 shots for themselves and children 6 months and older. Advertisements in both English and Spanish language began running last month. 

For information about flu vaccine clinics, contact the local health department or visit vaccines.gov/find-vaccines/. Today's data is summarized briefly below:­

• Cases Per 100k - 35.59
• 7-Day Average Cases Per 100k - 27.94
• Test Results Reported - 82,148
• Total Positive - 6,956
• Percent Positive - 7.95%**     
• 7-Day Average Percent Positive - 6.68%**      
• Patient Hospitalization - 3,572 (+1)
• Patients Newly Admitted - 612
• Patients in ICU - 342 (+0)
• Patients in ICU with Intubation - 156 (+13)
• Total Discharges - 374,137 (+554)
• New deaths reported by healthcare facilities through HERDS - 27
• Total deaths reported by healthcare facilities through HERDS - 59,895

** Due to the test reporting policy change by the federal Department of Health and Human Services (HHS) and several other factors, the most reliable metric to measure virus impact on a community is the case per 100,000 data -- not percent positivity.       

The Health Electronic Response Data System is a NYS DOH data source that collects confirmed daily death data as reported by hospitals, nursing homes and adult care facilities only.      

Important Note: Effective Monday, April 4, the federal Department of Health and Human Services (HHS) is no longer requiring testing facilities that use COVID-19 rapid antigen tests to report negative results. As a result, New York State's percent positive metric will be computed using only lab-reported PCR results. Positive antigen tests will still be reported to New York State and reporting of new daily cases and cases per 100k will continue to include both PCR and antigen tests. Due to this change and other factors, including changes in testing practices, the most reliable metric to measure virus impact on a community is the case per 100,000 data — not percent positivity.  

• Total deaths reported to and compiled by the CDC - 76,269

This daily COVID-19 provisional death certificate data reported by NYS DOH and NYC to the CDC includes those who died in any location, including hospitals, nursing homes, adult care facilities, at home, in hospice and other settings.  

Each New York City borough's 7-day average percentage of positive test results reported over the last three days is as follows **:    

Borough	Monday,   Dec.   12, 2022	Tuesday,   Dec.  13, 2022	Wed.   Dec.   14,2022
Bronx	7.90%	8.00%	8.16%
Kings	5.14%	4.68%	4.71%
New York	6.93%	6.87%	7.12%
Queens	9.09%	8.94%	8.94%
Richmond	6.46%	6.37%	6.28%

Member Of Money Laundering Operation Pleads Guilty In Connection With $5 Million Online Vehicle Sale Scam

 

Other Defendants Involved in the Scheme Pled Guilty Previously

 Damian Williams, the United States Attorney for the Southern District of New York, announced that Lithuanian national STANISLAV TUNKEVIC pled guilty in Manhattan federal court to conspiracy to commit bank fraud in connection with a scheme to launder fraud proceeds derived from an online vehicle sale scam that generated at least $5.3 million from dozens of defrauded consumers.  TUNKEVIC pled guilty before U.S. District Judge Analisa Torres.

U.S. Attorney Damian Williams said: “Tunkevic and his co-defendants have admitted to getting paid to use fake documents and shell companies to open bank accounts in order to receive criminal proceeds.  Without their knowing involvement, online fraudsters would not be able to profit from their illegal schemes.  Tunkevic and his co-defendants will now face prison terms and be required to forfeit their ill-gotten gains.”

As alleged in the Complaint and the Indictments and based on statements made in court:    

At various times from at least March 2019 through approximately March 2021, TUNKEVIC and co-defendants KAROL KAMINSKI, ARTURAS GILYS, and SVETLANA VAIDOTIENE were Lithuanian nationals who were recruited in Lithuania to travel to New York City in order to participate in a money laundering operation based in Brooklyn.  The operation was coordinated in New York City by co-defendant NATALIA KORZHA and also involved her son and co-defendant VLADISLAV NECEAEV.  Under the direction of KORZHA, NECEAEV, TUNKEVIC, KAMINSKI, GILYS, VAIDOTIENE, and other co-conspirators opened numerous bank accounts in the name of shell companies for the purpose of laundering money stolen from consumers who were trying to buy vehicles online.  In exchange, the defendants received a cut of the victims’ money. 

Other members of the conspiracy, pretending to represent car dealerships, advertised vehicles that they did not own and were not authorized to sell on fake websites with domain names that sounded like legitimate car dealerships or through online marketplaces like Craigslist and eBay.  Victims who responded to those advertisements and negotiated a purchase price were instructed by the purported sellers to wire payment to accounts that NECEAEV, KAMINSKI, TUNKEVIC, GILYS, VAIDOTIENE, and other co-conspirators opened.  Once the payments cleared, the defendants quickly withdrew the funds before the victims realized they had been defrauded.  The victims never received the vehicles they thought they had bought or any refunds from the fake sellers.  In total, dozens of victims were defrauded of a total of at least $5.3 million. 

TUNKEVIC, 48, of Vilnius, Lithuania, pled guilty to one count of conspiracy to commit bank fraud and agreed to pay forfeiture and restitution in the amount of $405,000.  TUNKEVIC is scheduled to be sentenced by Judge Torres on March 15, 2023.

KORZHA, 50, of Brooklyn, New York, pled guilty to one count of conspiracy to commit bank fraud on May 4, 2022.  She was sentenced by Judge Torres on September 7, 2022, to 48 months in prison and was ordered to pay forfeiture and restitution in the amount of $5,386,538.

NECEAEV, 29, of Brooklyn, New York, pled guilty to one count of conspiracy to commit bank fraud on March 14, 2022.  He was sentenced by Judge Torres on September 7, 2022, to 18 months in prison and was ordered to pay forfeiture and restitution in the amount of $458,300.

KAMINSKI, 32, of Vilnius, Lithuania, pled guilty to one count of conspiracy to commit bank fraud on November 9, 2022, and agreed to pay forfeiture and restitution in the amount of $338,700.  KAMINSKI is scheduled to be sentenced by Judge Torres on March 15, 2023.

GILYS, 41, of Vilnius, Lithuania, pled guilty to one count of conspiracy to commit bank fraud on November 15, 2022, and agreed to pay forfeiture and restitution in the amount of $321,700.  GILYS is scheduled to be sentenced by Judge Torres on March 15, 2023.

VAIDOTIENE, 55, of Vilnius, Lithuania, pled guilty to one count of conspiracy to commit bank fraud on September 20, 2022, and agreed to pay forfeiture and restitution in the amount of $271,000.  VAIDOTIENE is scheduled to be sentenced by Judge Torres on January 18, 2023.

The offense of conspiracy to commit bank fraud carries a maximum sentence of 30 years in prison and a maximum fine of $1,000,000.  The crime of conspiracy to commit money laundering carries a maximum sentence of 20 years in prison and a maximum fine of $500,000 or twice the value of the property involved in the transaction.

The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge.

Mr. Williams praised the outstanding investigative work of Homeland Security Investigations and the New York City Police Department.  He also thanked the U.S. Department of Justice’s Office of International Affairs of the Department’s Criminal Division, the United States Marshals Service, the Prosecutor General’s Office of the Republic of Lithuania, and the Lithuanian Criminal Police Bureau for their assistance in this investigation.

MAYOR ADAMS TAKES ACTION TO PROMOTE EQUITABLE AND LEGAL CANNABIS MARKET, ANNOUNCES SEIZURE OF $4 MILLION OF ILLEGALLY SOLD ITEMS AFTER INTERAGENCY CRACKDOWN ON UNLICENSED CANNABIS DISPENSARIES

 

Administration Continues to Work in Close Partnership with State to Ensure Just and Equitable Rollout of Legal Cannabis Market

 

Interagency Task Force Comprised of Sheriff’s Office, NYPD, DCWP, and Office of Cannabis Management Seized More Than $4 Million Worth of Illegal Products During Two-Week Pilot

New York City Mayor Eric Adams today took action to promote a more equitable cannabis market by announcing the results of a two-week interagency pilot conducting enforcement against unlicensed establishments selling cannabis, cannabis-infused edibles, illegal vaping products, illegal cigarettes, and other illegal tobacco products. The pilot program — conducted jointly by the New York City Sheriff’s Office, the New York City Police Department (NYPD), the New York City Department of Consumer and Worker Protection (DCWP), and the New York State Office of Cannabis Management (OCM) — resulted in the seizure of more than $4 million worth of products being sold illegally and the issuance of 566 civil and criminal summonses.

 “We will not let the economic opportunities that legal cannabis offers be taken for a ride by unlicensed establishments,” said Mayor Adams. “Today, we are not only announcing the seizure of $4 million in products that were being sold illegally to New Yorkers. Thanks to this joint interagency task force pilot, the city and the state collaborated to crack down on bad actors who are putting New Yorkers’ — particularly young people’s — health and safety at risk, and who sought to cut the line and undermine the legal market. It's high time that unlicensed stores stopped selling illegal products and comply with the law.”

 The Cannabis NYC Interagency Enforcement Task Force was a two-week pilot program to align efforts between the city and state on enforcement against establishments selling illegal cannabis, vaping, and tobacco products. The pilot was conducted the week of November 14^th to November 19^th, and the week of November 28^th to December 3^rd.

The results of the task force included: 

• Inspections of 53 locations throughout the five boroughs.
• Seizure of more than 100,000 illegal products, totaling an estimated retail value of $4,143,647.
• Issuance of 500 civil violations and 66 criminal summonses.
• Two felony arrests and one arrest on an outstanding warrant.

 “The New York City sheriff’s task force was successful in seizing hundreds of illegal products that were being sold by unlicensed businesses, many of which had the potential to endanger the health and safety of the public,” said New York City Sheriff Anthony Miranda. “We have an obligation to support the legal cannabis industry and create a fair opportunity for legal dispensaries to succeed, and that means taking enforcement action against those who continue to operate illegally by selling contraband and evading taxes. The collective efforts of the task force, under the direction of Mayor Adams, sends a clear message to illegal businesses that their actions will not be tolerated, and it will be necessary for them to comply with licensing laws.”  

 “The NYPD has been working very closely with our many public and private partners, in the city and in the state, in support of this important initiative,” said NYPD Commissioner Keechant L. Sewell. “As we move forward regarding this ongoing issue, the NYPD remains a committed partner, steadfast in its mission of upholding the law and improving public safety for all in New York City.”

“Selling tobacco and e-cigarette products without a license is not only illegal, but it puts the health of our friends, neighbors, and loved ones at risk,” said DCWP Commissioner Vilda Vera Mayuga. “DCWP will not hesitate to hold unlicensed tobacco and e-cigarette retailers accountable for violating the law. Thank you to Mayor Adams and Sheriff Miranda for launching this multiagency effort to protect the health and safety of our fellow New Yorkers.”

 “Mayor Adams launched Cannabis NYC to support New Yorkers and justice-involved individuals who want to build and operate legitimate, thriving cannabis businesses,” said Cannabis NYC Founding Director Dasheeda Dawson. “We have an opportunity to become a global hub of industry excellence in education and equity, but we must protect that opportunity for all New Yorkers, particularly the communities most harmed by cannabis prohibition. The Cannabis NYC Interagency Enforcement Taskforce not only tackles a growing public health and safety concern, but also ensures that those jeopardizing the success of New York’s equity-centered legalization will face fines, penalties, and other civil consequences. The Adams administration is committed to enforcing the law without criminalizing communities targeted by the racially fueled policies of prohibition.”

 “Interagency collaboration is one the many strengths of this administration, and this task force is proof of that,” said New York City Department of Small Business Services Commissioner Kevin D. Kim. “It is imperative that we protect the cannabis entrepreneurs working hard to build up a regulated cannabis industry. SBS is here to support every small business choosing to play by the rules.”

 The Adams administration is committed to promoting the growth of an equitable cannabis industry in New York City, in concert with state partners. In August, Mayor Adams and the New York City Department of Small Business Services (SBS) announced the launch of Cannabis NYC, a first-of-its-kind initiative to provide a broad suite of services to industry stakeholders and those looking to participate in the legal cannabis market. Mayor Adams also announced the appointment of Dasheeda Dawson — a nationally renowned cannabis advocate, who played a pivotal role in the passage of the New York Marijuana Regulation and Taxation Act — to lead the initiative.

 “Governor Hochul has made clear that we cannot be a legal, regulated market operating side-by-side with an illicit market that puts public health at risk, does not contribute to our communities, and undermines our goal to build the most equitable and inclusive cannabis market in the nation,” said Chris Alexander, executive director, New York State Office of Cannabis Management. “We’re thankful for this partnership with New York City in helping to shutter these illicit operators, as we are with similar partnerships across the state, and our efforts to shutdown these stores and trucks will continue to expand.”

Governor Hochul Urges Caution in Advance of Winter Storm Expected to Impact Most of New York State Thursday Through Saturday

 

12 to 18 Inches of Snow Expected in Parts of North Country, with Parts of Mohawk Valley, Central New York, Southern Tier and Capital Regions Expected to Receive 8 to 12 Inches of Snow Through Saturday

Wintry Mix of Snow and Rain Anticipated in Western New York, Finger Lakes, Southern Tier, and Central New York

Winter Weather Will Cause Hazardous Travel Conditions in Multiple Regions, With Potential for Power Outages in Areas with Heavy Snowfall

Governor Hochul Urges No Unnecessary Travel Thursday Afternoon through Friday in Impacted Regions

 Governor Kathy Hochul today urged caution in advance of a winter storm forecast to impact most of the state, particularly the North Country, Mohawk Valley, Capital Region, Mid-Hudson and Central New York regions, with a mixture of snow and rain beginning Thursday and continuing through Friday. Starting Thursday, parts of the North Country could see 12 to 18 inches or more of snow, and parts of the Mohawk Valley, Central New York, Southern Tier and Capital Region are expected to receive up to a foot of snow by Saturday, with peak snowfall rates up to two inches per hour possible Thursday night and on Friday. Freezing rain or sleet is not expected to produce significant ice accumulations during the event. However, travel conditions will be dangerous starting Thursday evening and snow may be wet and heavy enough to cause localized power outages. Governor Hochul urged New Yorkers to monitor their local forecasts, be prepared for changing weather conditions Thursday evening through Friday, and no unnecessary travel in impacted regions.

"I encourage all New Yorkers to exercise caution and be ready for possible power outages and tough commutes on Thursday and Friday as snow and ice accumulate in eastern parts of upstate," Governor Hochul said. "Our emergency response agencies are well-prepared for this storm and will be working around the clock these next few days to keep New Yorkers safe."

In addition to snowfall in the forecast, the New York City and Long Island regions are expected to see up to two inches of rain beginning Thursday afternoon into Saturday morning. This precipitation could begin as a wintry mix on Thursday afternoon that could impact evening commutes.

Multiple weather warnings and advisories have been issued for several parts of the state through Saturday. For a complete listing of weather warnings in your area, visit your area's National Weather Service website.

New York State Division of Homeland Security and Emergency Services Commissioner Jackie Bray said, "Pay close attention to your local forecast today and tomorrow. Most of the state will see at least several inches of snow and some regions will see more than a foot. It may be dangerous to travel on Friday in certain regions so, if you have to travel, be sure to build out extra time in your commute and take all necessary precautions."

Safety Tips

Travel

Some of the most important tips for safe driving include:

• Do not drive unless necessary.
• Use caution on bridges as ice can form quicker than on roads.
• If you must travel, make sure your car is stocked with survival gear like blankets, a shovel, flashlight and extra batteries, extra warm clothing, set of tire chains, battery booster cables, quick energy foods and brightly colored cloth to use as a distress flag.
• If you have a cell phone or other communications device such as a two-way radio available for your use, keep the battery charged and keep it with you whenever traveling. If you should become stranded, you will be able to call for help, advising rescuers of your location.
• The leading cause of death and injuries during winter storms is transportation accidents. Before getting behind the wheel, make sure that your vehicle is clear of ice and snow; good vision is key to good driving. Plan your stops and keep more distance between cars. Be extra alert and remember that snowdrifts can hide smaller children. Always match your speed to the road and weather conditions.
• It is important for motorists on all roads to note that snowplows travel at speeds up to 35 mph, which in many cases is lower than the posted speed limit, to ensure that salt being dispersed stays in the driving lanes and does not scatter off the roadways. Oftentimes on interstate highways, snowplows will operate side by side, as this is the most efficient and safe way to clear several lanes at one time.
• Motorists and pedestrians should also keep in mind that snowplow drivers have limited lines of sight, and the size and weight of snowplows can make it very difficult to maneuver and stop quickly. Snow blowing from behind the plow can severely reduce visibility or cause whiteout conditions. Motorists should not attempt to pass snowplows or follow too closely. The safest place for motorists to drive is well behind the snowplows where the roadway is clear and salted. Never attempt to pass a snowplow while its operating.

Heavy Exertion

Heavy exertion, such as shoveling snow, clearing debris or pushing a car, increase the risk of a heart attack. To avoid problems:

• Stay warm, dress warm, and slow down when working outdoors.
• Take frequent rests to avoid overexertion.
• If you feel chest pain, shortness of breath, or pain in your jaw radiating down your arm, stop what you are doing and seek help immediately.

Power Outages

• Call your utility to determine area repair schedules.
• Turn off or unplug lights and appliances to prevent a circuit overload when service is restored; leave one light on to indicate when power has been restored.
• If heat goes out during a winter storm, keep warm by closing off rooms you do not need.

Heating Safety

• Use only safe sources of alternative heat such as a fireplace, small well-vented wood or coal stove or portable space heaters.
• Always follow manufacturer's instructions.
• When using alternative heat sources such as a fireplace, woodstove, etc. always make sure you have proper ventilation.
• Keep curtains, towels, and potholders away from hot surfaces.
• Have a fire extinguisher and smoke detectors and make sure they work.
• If you use kerosene heaters to supplement your regular heating fuel, or as an emergency source of heat, follow these safety tips:
  • Follow the manufacturers' instructions.
  • Use only the correct fuel for your unit.
  • Refuel outdoors only and only when the unit is cool.
  • Keep the heater at least three feet away from furniture and other flammable objects.
  • When using the heater, use fire safeguards and ventilate properly.

For more safety tips, visit https://dhses.ny.gov/safety.

Two Defendants Plead Guilty To COVID-19 Fraud

 

Tatiana Benjamin and Heaven West Defrauded New York City’s COVID-19 Hotel Room Isolation Program

Damian Williams, the United States Attorney for the Southern District of New York, announced that TATIANA BENJAMIN and HEAVEN WEST pled guilty to defrauding New York City’s COVID-19 Hotel Room Isolation Program.  BENJAMIN pled guilty to conspiracy to commit wire fraud, while WEST pled guilty today to wire fraud.  Both defendants pled guilty before United States Magistrate Judge James L. Cott.  Both defendants’ case is assigned to United States District Judge Lewis A. Kaplan.

U.S. Attorney Damian Williams said: “As they admitted, the defendants abused a program designed to provide shelter to the sick and needy during the height of the COVID-19 pandemic.  In connection with the fraud, Tatiana Benjamin even purchased the personal identifying information of several medical professionals.  For their brazen misconduct, the defendants now face possible prison time.”

According to the allegations contained in the Indictment, court filings, and statements made during plea proceedings:

From approximately April 2020 through July 2020, the defendants defrauded the COVID-19 Hotel Room Isolation Program (the “Program”).  In response to the COVID-19 pandemic, New York City created the Program.  Funded by New York City and the Federal Emergency Management Agency, the Program provided free hotel rooms for qualifying individuals throughout New York City.  The Program was open to (a) healthcare workers who needed to isolate because of exposure to COVID-19; (b) patients who had tested positive for COVID-19; (c) individuals who believed, based on their symptoms, that they were infected with COVID-19; and (d) individuals who lived with someone who contracted COVID-19.  As stated on the City’s website describing the Program, such individuals “may qualify to self-isolate in a hotel, free of charge, for up to 14 days if you do not have a safe place to self-isolate.”  Those who wished to book a hotel room through the Program could either call a phone number or use an online hotel booking platform. 

BENJAMIN and WEST defrauded the Program in several respects.  First, BENJAMIN and WEST each secured free Program hotel rooms for themselves by falsely claiming to be a respiratory therapist and a hospital employee, respectively.  Second, BENJAMIN and WEST each sold fraudulently obtained hotel rooms to customers who were ineligible for the Program.  Third, BENJAMIN purchased inside information from co-defendant Chanette Lewis, who worked at a call center that handled phone calls and certain reservations for the Program for several months in 2020.  Lewis was hired specifically for the Program, which gave her access to legitimate healthcare workers’ identifying information.  Lewis sold BENJAMIN, for $800, personal identifying information of at least five healthcare professionals, as well as certain “codes” to use when booking hotel reservations through the Program, such as an employee ID number and license number. 

BENJAMIN and WEST used Facebook to advertise the sale of fraudulently obtained Program hotel rooms and to communicate directly with customers.  For example, BENJAMIN told a Facebook user, “Friend at 311 gave me the juice for the hotel so I been booking ppl rooms,” and when WEST was asked whether she had “rooms” available, she replied, “Nah I dead don’t bro / All essential hotels are clipped” and added, “They finding out we was scamming the system lol.” 

BENJAMIN, 28, of Brooklyn, New York, pled guilty to one count of conspiracy to commit wire fraud, which carries a maximum sentence of 20 years in prison.  Under the terms of her plea agreement, BENJAMIN has agreed to forfeit $51,088 and to pay restitution of $294,624. 

WEST, 22, of Atlanta, Georgia, pled guilty to one count of wire fraud, which carries a maximum sentence of 20 years in prison.  Under the terms of her plea agreement, WEST has agreed to forfeit $23,684 and to pay restitution of $59,644.

The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge.  The defendants are both scheduled to be sentenced by Judge Kaplan on May 18, 2023, at 3:00 p.m.

Two co-defendants previously pled guilty: Tatiana Daniel previously pled guilty to conspiracy to commit wire fraud and is scheduled to be sentenced by Judge Kaplan on March 29, 2023, at 2:30 p.m.  Chanette Lewis previously pled guilty to two counts of conspiracy to commit wire fraud and is scheduled to be sentenced by Judge Kaplan on May 18, 2023, at 3:00 p.m.

Mr. Williams praised the outstanding efforts of agents, investigators, and analysts from the New York City Department of Investigation (“DOI”), DOI - NYCHA Office of the Inspector General, the New York Regional Office of the U.S. Department of Labor – Office of Inspector General (“DOL-OIG”), and the U.S. Attorney’s Office for the Southern District of New York.  Mr. Williams also thanked the New York/New Jersey High Intensity Drug Trafficking Area Intelligence Analysts for their support and assistance in this investigation.  He also expressed gratitude to the New York City Police Department, the New York State Department of Labor, and the DOL-OIG Atlanta Regional Office for their assistance.

Insider At Major Financial Services Organization And Retired Financial Professional Charged With Multimillion Dollar Front-Running Scheme

 

Lawrence Billimek and Alan Williams Made Tens of Millions of Dollars in Profits by Trading Based on Stolen Confidential Trade Information

Damian Williams, the United States Attorney for the Southern District of New York, and Michael J. Driscoll, the Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced that LAWRENCE BILLIMEK, a trader at a major financial services organization (the “Employer’), and ALAN WILLIAMS, a retired financial professional and active day-trader, were charged in an indictment in Manhattan federal court with securities fraud and wire fraud in connection with an extensive insider trading scheme, in which they stole confidential information about the trade orders of the Employer in order to conduct over a thousand timely, profitable securities trades in the same stocks as the Employer.  BILLIMEK attempted to hide his conduct by using prepaid, unregistered “burner” phones, and WILLIAMS sent millions of dollars back to BILLIMEK for sharing the confidential information.  BILLIMEK was arrested today in the Western District of Texas and WILLIAMS was arrested in the District of Oregon.

U.S. Attorney Damian Williams said: “By stealing confidential trade information from a major financial services organization, Lawrence Billimek betrayed the trust and confidence of his employer and schemed with Alan Williams to make tens of millions of dollars of illegal profit.  Billimek and Williams tried to cover their tracks by using burner phones and secret payments, but their scheme has now been laid bare.”

FBI Assistant Director in Charge Michael J. Driscoll said: “As alleged, the defendants engaged in a years-long scheme in which Mr. Billimek obtained information regarding his employer’s intent to make relatively large trades in certain stocks.  In turn, this allowed Mr. Williams to trade in the same stocks in advance and realize substantial ill-gotten profits.  These types of insider-trading schemes satisfy the greedy ambitions of nefarious actors at the expense of average investors.  The FBI remains steadfast in our efforts to ensure our financial markets are a level playing field for all by bringing to justice those who would seek to illegally exploit them.”

As alleged in the Indictment unsealed today in Manhattan federal court:[1]

LAWRENCE BILLIMEK has been employed at the Employer since approximately 2012.  The Employer is a major financial services organization that provides asset management services with over $200 billion in assets.  ALAN WILLIAMS spent years working as a trader in the financial services industry.  WILLIAMS is currently retired but is an active day-trader. 

The Front Running Scheme

Based on his position as a trader at the Employer, BILLIMEK had access to the trade information and trade orders of the Employer.  Like most large asset managers, the Employer had rules and regulations concerning employees’ personal trading, including requirements about the confidentiality of client information and prohibitions against insider trading and personal trading in the same securities as the Employer.  Because of the size of the Employer’s trade orders, trades by the Employer often caused temporary movements in the price of the securities they traded.  For example, if the Employer engaged in a large purchase of stock, the increased demand could cause a rise in the stock price, and if the Employer engaged in a large sale of stock, the increased supply could cause a drop in the stock price.  Because BILLIMEK had access to the Employer’s trade orders, he knew in advance when a particular stock price would move up or down based on that trading.

WILLIAMS was an active day trader through at least two retail brokerage accounts.  From at least 2016 through 2022, after obtaining information about the Employer’s upcoming trading activity from BILLIMEK, WILLIAMS bought or sold the same securities that the Employer would be buying or selling in order to profit through the subsequent movement of the stock that would occur along with the Employer’s trading.  WILLIAMS would then exit those positions once the Employer’s trading was underway or complete, often within minutes.  For example, if WILLIAMS learned from BILLIMEK that the Employer would be buying a particular stock, WILLIAMS purchased that stock beforehand.  Then, as the Employer made relatively large purchases, the stock price would increase and WILLIAMS would sell those same stock, on the same day, at a profit. 

BILLIMEK and WILLIAMS engaged in these front-running trades on at least over a thousand occasions between 2016 and 2022.  In order to hide their communication throughout the scheme, BILLIMEK used prepaid, unregistered “burner” phones to provide confidential information as well as trading instructions to WILLIAMS.  In total, WILLIAMS’ trading based on the confidential trade information from BILLIMEK generated tens of millions of dollars in profits, and WILLIAMS shared millions of dollars of those profits with BILLIMEK through checks and wire transfers.  At times, BILLIMEK also provided false and misleading information to financial institutions about the purpose and nature of those transfers, including referring to them as gifts.

LAWRENCE BILLIMEK, 51, of Hailey, Idaho, and ALAN WILLIAMS, 77, of West Linn, Oregon, are each charged with one count of conspiracy to commit securities fraud and wire fraud, one count of securities fraud, and one count of wire fraud, which carry a total maximum sentence of 45 years in prison. 

The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge.

Mr. Williams praised the work of the FBI.  Mr. Williams further thanked the Office of United States Securities and Exchange Commission for their cooperation and assistance in this investigation. 

The allegations contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

[1] As the introductory phrase signifies, the entirety of the text of the Indictment, and the description of the Indictment set forth herein, constitute only allegations, and every fact described should be treated as an allegation.