Rhode Island Leader Of Sophisticated, Violent Fraudulent Document Ring Pleads Guilty To Racketeering And Money Laundering

RICHMOND, Va. – Felipe Alvarado Gonzalez, age 46, a Mexican National who resided in Pawtucket, Rhode Island pleaded guilty today to Conspiracy to Engage in Racketeering and Conspiracy to Launder Money.  Alvarado Gonzalez faces a maximum of 40 years’ imprisonment, a fine of $750,000, and three years of supervised release.  Further, the defendant is illegally within the United States and faces deportation following the service of his prison sentences.

Dana J. Boente, Acting United States Attorney for the Eastern District of Virginia; and Katrina W. Berger, Acting Special Agent in Charge for U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI), made the announcement after the guilty plea was accepted by Magistrate Judge M. Hannah Lauck. 

According to court papers, this defendant is connected to a Fraudulent Document Enterprise (FDE) previously prosecuted in the Eastern District of Virginia in United States v. Israel Cruz Millan, Case No. 3:10CR308.  The FDE originally operated in the United States beginning prior to 2008 and continuing through November 18, 2010, and had cells in Richmond, Norfolk, Virginia Beach, and Manassas, Virginia; Fayetteville and Little Rock, Arkansas; New Haven, Connecticut; Mishawaka, Indiana; Lexington and Louisville, Kentucky; Chelsea, Massachusetts; St. Louis, Missouri; Chapel Hill, Greensboro, Raleigh, and Wilmington, North Carolina; Cincinnati, Ohio; Providence, Rhode Island; and, Nashville, Tennessee.   The criminal enterprise was dismantled within the United States on November 18, 2010.  In the prior case and connected prosecutions, a total of 30 defendants were convicted.  On February 16, 2012, United States District Judge James R. Spencer sentenced the overall leader, Israel Cruz Millan, to 300 months’ imprisonment.   On March 2, 2012, United States District Judge Henry E. Hudson sentenced Oliverez-Jiminez to two consecutive life terms in prison, after a jury convicted him for racketeering, murder, kidnapping, conspiracy to commit money laundering, and conspiracy to produce and transfer false identification documents. 

According to court filings, the FDE restarted its operations while the Israel Cruz Millan, et al. case was still pending.  Beginning at some point prior to February 2012, Manuel Hidalgo Flores, also known as “Chino,” “Chimuelo” and “Julio,” began managing the organization’s operations in the United States, supervising operations in Richmond, Virginia; Springdale, Arkansas; Boston, Massachusetts; Raleigh, North Carolina; Cincinnati, Ohio; and Pawtucket, Rhode Island.  As in the previous case, the FDE produced high-quality false identification cards for distribution to illegal aliens.  In most cities where the organization operated, Hidalgo Flores placed a cell manager to supervise a number of “runners,” the lower level members of the organization who distributed business cards advertising the organization’s services and helped facilitate transactions with customers.  In his sworn Statement of Facts, Felipe Alvarado Gonzalez, also known as “Wicho,” admitted that, while working under Hidalgo Flores, he supervised runners operating in the Pawtucket, Rhode Island cell. 

The cost of fraudulent documents varied depending on the location, with counterfeit Resident Alien and Social Security cards typically selling for approximately $150.  Each cell maintained detailed sales records and divided the proceeds between the runner, the cell manager, and the upper level managers in Mexico.  In addition, the FDE used Western Union and MoneyGram to funnel criminal proceeds to Mexico.

The evidence during the Oliverez-Jiminez trial detailed how members of the organization sought to drive competitors from their territory by posing as customers in search of fraudulent documents and then attacking the competitors when they arrived to make a sale.  According to court filings, the FDE continued those tactics in 2013.  The First Superseding Indictment charges four FDE members, including Manuel Hidalgo Flores, with targeting a competitor in the Richmond, Virginia area on October 6, 2013.  That planned attack was thwarted, however, by law enforcement intervention. 

Counting this guilty plea, 33 members of this organization charged in the Richmond, Virginia federal cases have been convicted.  Currently, Alvarado Gonzalez is scheduled to be sentenced on July 7, 2014, before United States District Court Judge James R. Spencer.  Out of the 12 defendants arrested in the current case on October 30, 2013, 9 are scheduled to proceed to a jury trial on June 2, 2014.

The case was investigated by the Richmond and Norfolk offices of ICE’s Homeland Security Investigations (HSI), which falls under the Washington, D.C. office.  ICE HSI received assistance from the Virginia State Police, Chesterfield County Police Department, and Henrico County Police Department.  Assistant United States Attorney Michael Gill and Trial Attorney Maria Gonzalez Calvet, of the Criminal Division's Fraud Section, are prosecuting the case on behalf of the United States.

A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.