Tuesday, April 30, 2019

Founder of Local Technology Company Charged With Operating a $60 Million Investment Fraud

SAN DIEGO – Jonny Ngo, the former president and chief executive officer of NL Technology, LLC, was arraigned today on a 21-count indictment charging him with wire fraud, mail fraud and money laundering in connection with operating a $65 million investment fraud. The hearing took place in federal court before U.S. Magistrate Judge Mitchell D. Dembin after the indictment was unsealed.      

According to the indictment, Ngo induced his victims to invest funds in various short-term investment contracts by making false representations, including that: (a) investor money would be used to fund wholesale purchase orders of smartphone screens and other electronic goods; (b) NL Technology was a regular supplier of smartphone screens to a number of buyers, including two buyers who each ordered approximately $2 million of product from NL Technology; (c) all wholesale orders funded by investor money was pre-purchased by NL Technology clients; and (d) the quality of the products and safety of investor funds used to purchase the products was guaranteed by a third-party escrow company.

The indictment further alleges that Ngo created counterfeit invoices falsely indicating that NL Technology had substantial purchase orders from alleged wholesale companies. The indictment alleges that Ngo also provided false financial statements purportedly certified by an accountant showing NL Technology earned income from its wholesale business totaling $12.5 million in 2015 and $15.4 million in 2016.  Moreover, as alleged, Ngo fabricated bank statements or screenshots from bank statements held in the name of NL Technology with individual line items altered to appear as legitimate wholesale business transactions.  Lastly, Ngo created false checks from wholesale companies allegedly doing business with NL Technology.  

To further his investment fraud, Ngo and others allegedly told investors that they could roll over their investments into future investment contracts with NL Technology, when in fact no such future investments were possible.  Also, Ngo allegedly lulled investors about the continued viability of NL Technology through materially false representations, including that NL Technology had an outstanding purchase order from a smartphone repair company for approximately $300,000, when in fact, no such order existed.

Instead of investing the funds in the business, the indictment alleges that Ngo converted investor funds to his own personal use and benefit by spending the money on a home, luxury cars and gambling.  As a result of his investment fraud, it is alleged that Ngo induced investors to part with more than $60 million, and ultimately caused millions of dollars in losses.

“Investment fraud has a long-lasting and devastating effect on victims in our community,” said U.S. Attorney Robert S. Brewer, Jr. “When these schemes are brought to our attention, we will work collaboratively with our law enforcement partners to unravel the fraud and hold those responsible for profiting from it.”

FBI Acting Special Agent in Charge Suzanne Turner said:  “Mr. Ngo's alleged technology business scheme was, in fact, a plan to deceive investors, luring them into a false sense of security about their investments, falsifying documents to cover the lies and stealing the funds for personal use. The FBI will continue to identify and investigate those who defraud investors. We ask anyone who has information related to investor fraud submit a tip at https://tips.fbi.gov/.”

U.S. Postal Inspection Srevice Inspector in Charge Nichole Cooper stated: “Mr. Ngo is accused of a scheme that separated millions of dollars from consumers who believed they were making legitimate investments.  However, those who commit crimes like this one fail to realize that Postal Inspectors and our federal law enforcement partners will discover these greedy schemes and will bring the culprits to justice for their crimes against unsuspecting investors.”

The Government moved to detain the defendant as a risk of flight.  Judge Dembin set a detention hearing for Tuesday, April 30, 2019 at 9:30 a.m. before U.S. Magistrate Judge Ruben B. Brooks. The defendant will remain in custody until the hearing. Judge Dembin also scheduled a motion hearing/trial setting for June 7, 2019 at 11 a.m. before U.S. District Judge Jeffrey T. Miller.

DEFENDANT                                                           Case Number: 19CR1391-JM                               

Jonny Ngo                               Age: 32                       San Diego, CA


Title 18, United States Code, Section 1343 – Wire Fraud

Maximum Penalties: 20 years’ in prison, a fine of $250,000, three years of supervised release

Title 18, United States Code, Section 1341 – Mail Fraud

Maximum Penalties: 20 years’ in prison, a fine of $250,000, three years of supervised release

Title 18, United States Code, Section 1957 – Money Laundering

Maximum Penalties: 10 years’ in prison, a fine of $250,000, three years of supervised release


Federal Bureau of Investigation

United States Postal Inspection Service

An indictment itself is not evidence that the defendant committed the crimes charged.  The defendant is presumed innocent until the Government meets its burden in court of proving guilt beyond a reasonable doubt.

Thursday, April 25, 2019

Criminal Justice Technology in the News

Law Enforcement News

Therapy K9s: Changing the Way Law Enforcement Serves Communities
PoliceOne.com, (04/18/2019), Jason Ratcliff
This article profiles the law enforcement canine therapy program run by the Franklin County (Ohio) Sheriff’s Office. The program includes public relations and community engagement as well as victim advocacy, mental health and trauma.
Link to article

Hello, Stranger: How Doorbell Cameras in North Texas Are Helping Police and Residents Catch Bad Guys
Dallas Morning News, (04/10/2019), Charles Scudder
This article looks at how community residents and local police departments work cooperatively together to use doorbell cameras and the Neighbors app to fight crime. Footage from the cameras can help combat “porch pirates,” car burglars, residential break-ins and more.
Link to article

Oneida County Unveils New Tool to Fight Opioid Deaths
Observer-Dispatch, (04/18/2019), Amy Neff Roth
At a recent press conference, Oneida County, N.Y., announced plans to use the Overdose Detection Mapping Application Program to track both fatal and non-fatal overdose incidents. A lack of real-time data has hindered local efforts to combat the opioid epidemic; ODMAP data will help facilitate quick responses from local government, law enforcement and human service agencies.
Link to article

Officers Take Part in 25th Year of Bike Patrol Training
Emporia Gazette, (04/20/2019), Lydia Kautz
The Lyon County (Kan.) Sheriff’s Office recently continued a 25-year tradition by offering bike officer training to officers from nearby jurisdictions. The training covers such tactics as using a firearm while riding, and maneuvering up and down stairs, but the greatest emphasis is on how bike officers can build community connections through their accessibility.
Link to article

Police Training Evolves as Scientists Study the Trauma of Rape
The News & Observer, (04/22/2019), Kate Martin for the Carolina Public Press
This article takes an in-depth look at a new trend in training for handling sexual assault investigations. Training programs that help officers understand how victims mentally process and recall trauma, and teach them appropriate interviewing techniques, have proven beneficial in successfully investigating and processing sexual assault cases.
Link to article

Safety in Schools: How a Yakima Program Could Help Guide a New Statewide Network
Yakima Herald-Republic, (04/23/2019), Janelle Retka
This article presents a profile of the School Safety Operations and Coordination Center in Washington’s Educational Service District 105, a regional school district encompassing Yakima County. The center is a potential model for a series of similar centers to be created throughout the state under pending legislation. The center monitors school safety efforts, school safety plans and logs school drills, among other services.
Link to article

Corrections News

As Oregon Inmates Age, Lawmakers Prepare for Rising Healthcare Costs
Salem Reporter, (04/19/2019), Claire Withycombe
This article takes an in-depth look at Oregon’s long-range planning for dealing with a rapidly aging prison population. The state is considering re-opening a closed facility specifically for geriatric inmates. Other issues to consider are the high cost of overtime incurred in transporting inmates to outside health care and the lack of advanced medical resources inside the state’s facilities.
Link to article

Tentative Settlement Agreement Reached in Lawsuit Over Prison Video Visitation
Houston Chronicle, (04/19/2019), Keri Blakinger
This article details the lawsuit filed by a Ft. Worth man who claimed his video visits with his brother in an Ohio correctional facility were repeatedly cut short. For individuals with family members incarcerated hundreds of miles away, video visits, although costly, are the only way to maintain contact. Under the settlement, the vendor will offer a free credit to anyone who used the system since 2009.
Link to article

Nebraska Corrections Offers $3K Bonus to Work at Certain Prisons, Citing Record-high Need, Turnover
Omaha World-Herald, (04/22/2019), Paul Hamel
The first 100 new employees who stay at least a year at four Nebraska correctional facilities identified as having significant staffing problems – Tecumseh, the State Penitentiary, the Lincoln Correctional Center and the Diagnostic and Evaluation Center in Lincoln – will receive $3,000 bonuses. In addition to the bonuses, the state plans to offer incentives for referring and supervising new staff, both part of an effort to combat high turnover rates.
Link to article

A Joint Law Enforcement Operation Targets Contraband at Holman Prison
Alabama Political Reporter, (04/23/2019), Brandon Moseley
Alabama Department of Corrections investigations and intelligence agents, emergency response teams and K-9 drug units recently conducted an operation to find and remove illegal contraband from the William C. Holman Correctional Facility in Atmore, a maximum security facility with 870 inmates. ADOC has recently come under fire as the result of a U.S. Department of Justice investigation.
Link to article

National Institute of Justice Forensic Technology Center of Excellence Launches New Method of Webinar Delivery

On May 1 at 1 p.m. Eastern time, the National Institute of Justice Forensic Technology Center of Excellence will present a webinar titled “The Elements of DNA Profile Interpretation and Probabilistic Genotyping.” This webinar is the first to use the NIJ FTCoE’s new platform, and all participants will need to register for new accounts.

The event, which is the first in a new webinar series, begins with background information on forensic DNA analysis, including terminology and mechanisms, to help all participants comprehend the material covered in the series. A retrospective view of approaches to interpretation and statistical analyses will be reviewed for the purpose of understanding the origin of strategies, methods, issues and solutions that comprise the history of forensic STR testing. Register at https://forensiccoe.org/webinar/dna-profile-probabilistic-genotyping/