New York
Founder of bankrupt subprime auto lender is charged with fraud
NEW YORK (AP) — The founder of Tricolor Holdings and other executives of the subprime auto lender were charged Wednesday with what federal authorities say was a massive fraud that led the company into bankruptcy.
Daniel Chu, the company’s founder and chief executive, was charged in an indictment unsealed in Manhattan federal court with directing multiple executives since 2018 to defraud investors and lending institutions through multiple fraudulent schemes.
A defense lawyer did not immediately return a message seeking comment.
According to the indictment, the scope of the fraud was revealed in late August when lenders confronted Chu and other executives about Tricolor’s collateral.
Chu and others accused of carrying out the fraud initially tried to conceal it, saying the collateral issues were due to an administrative error, the indictment said.
After those efforts failed, Chu extracted over $6 million from the company, the indictment said.
On Sept. 10, Tricolor filed for Chapter 7 bankruptcy because it owed over $900 million to the company’s largest lenders, the indictment said.
California
Doctor who helped sell ketamine to Matthew Perry avoids prison time
LOS ANGELES (AP) — A doctor who pleaded guilty in a scheme to supply ketamine to actor Matthew Perry before his overdose death was sentenced Tuesday to 8 months of home confinement.
Judge Sherilyn Peace Garnett handed down the sentence that included 3 years of supervised release to 55-year-old Dr. Mark Chavez in a federal courtroom in Los Angeles.
Before the sentence was delivered, Chavez addressed the judge and said he had lost a loved one recently and understood the grief that Perry’s death has caused.
Chavez acquired ketamine and gave it to Dr. Salvador Plasencia, who was sentenced to 2 1/2 years in prison earlier this month for selling ketamine to Perry in the months leading up to his death.
Chavez’s attorneys emphasized the difference between the two doctors and said that Chavez “accepted responsibility early” by cooperating with investigators and voluntarily giving up his medical license ahead of his detention hearing.
Perry had been taking the surgical anesthetic ketamine legally as a treatment for depression. But when his regular doctor wouldn’t provide it in the amounts he wanted, he turned to Plasencia.
Plasencia admitted to taking advantage of Perry, knowing he was a struggling addict. Plasencia texted Chavez that Perry was a “moron” who could be exploited for money, according to court filings.
Chavez admitted to obtaining the ketamine from a wholesale distributor on false pretenses and pleaded guilty to one count of conspiracy to distribute ketamine. He has not been in custody.
Chavez is the second person to be sentenced of the five defendants who have pleaded guilty in connection with Perry’s death at age 54 in 2023.
Perry was found dead by his assistant on Oct. 28. The medical examiner ruled ketamine was the primary cause of death. The actor had been using the drug through his regular doctor in a legal but off-label treatment for depression that has become increasingly common.
Seeking more ketamine than his doctor would give him, about a month before his death Perry found Plasencia, who in turn asked Chavez to obtain the drug for him.
He met with Plasencia between San Diego and Los Angeles to hand off ketamine he got using fraudulent prescriptions. In all, he admitted to supplying 22 5-milliliter vials of ketamine and nine ketamine lozenges.
Chavez will also be expected to do 300 hours of community service.
The other three defendants who reached deals to plead guilty will be sentenced at their own hearings in the coming months. Garnett has said she would seek to make sure all the sentences made sense in relation to one another.
California
Members of a secretive religious group have been charged with murder in 2 deaths
SAN BERNARDINO, Calif. (AP) — Members of a secretive California religious group have been charged with murder in the deaths of a man who disappeared in 2023 and a child who died in 2010.
Shelley “Kat” Martin, 62, who was described as a leader and “prophetess” of His Way Spirit Led Assemblies, was charged in the separate deaths of Emilio Ghanem, 40, whose burned-out pickup truck was found in a desert, and 4-year-old Timothy Thomas, known as Timo.
Martin’s husband, Darryl Martin, 58, was charged with murder solely in Timothy’s death. The charges were filed against the couple Monday in county Superior Court.
A statement from Anderson’s office described His Way, based in Hemet, as a “religious high-control group.”
Police have said Thomas died in 2010 after his parents placed him in the temporary custody of the Martins.
“Shelley and Darryl Martin took an active role in preventing Timo from receiving medical treatment. ... Timo’s death could have been prevented had he been allowed to receive medical attention for his appendicitis,” said Colton police Chief Anthony Vega.
The boy’s father, former His Way member Andre Thomas, also was charged with murder in the child’s death. No attorney for him was listed yet in the court file. A message seeking comment from an attorney for the Martins was not immediately returned Tuesday.
Ghanem was a member of His Way for nearly 20 years before he moved to Nashville, Tennessee, police said. He traveled back to California in May 2023 and was last seen at a coffee shop in Redlands, a status that gave the investigation of his disappearance to local police. His body has not been found.
Investigators found evidence of a homicide when Ghanem’s rental vehicle was discovered in the Mojave Desert, Redlands police Chief Rachel Tolber said Monday. She did not elaborate.
“The secretive and manipulative actions by the Martins and the members of His Way Spirit Led Assemblies presented particular challenges to the department’s investigation,” Tolber said.
In Timothy’s death, investigators received new information from former His Way members who were reluctant to speak truthfully years ago, Colton police Sgt. Shawn McFarland told the Los Angeles Times.
Mississippi
Woman charged after Walmart shoppers found razor blades in loaves of bread
A woman who allegedly pushed razor blades into loaves of bread at two Biloxi, Mississippi, Walmart stores was arrested on Tuesday.
Camille Benson, 33, of Texas, has been charged with attempted mayhem. Her bond is set at $100,000.
Harrison County Jail records on Wednesday morning do not list an attorney for Benson who could be reached for comment on her behalf. A message left at a phone number listed for a possible relative of Benson was not immediately returned.
Customers reported finding the razor blades at a Walmart Supercenter and a Walmart Neighborhood Market, said Lt. Candace Young, a public information officer for the Biloxi Police Department.
Walmart employees told police a customer first reported finding a razor blade in a loaf purchased from the Walmart Supercenter on Dec. 5. On Dec. 8, a customer who bought a loaf at the Walmart Neighborhood Market also reported finding a razor blade.
After another customer complained to the Walmart Supercenter on Sunday, employees inspected the merchandise and found several more loaves had been tampered with, law enforcement officials said.
The police department was notified on Monday.
In a press release, the department asked anyone who bought bread from those Walmart locations to inspect the loaves and report any findings.
“The health and safety of our customers is always a top priority,” Walmart said in a statement. “We have removed and thoroughly inspected all potentially affected products at impacted stores in Biloxi. We appreciate law enforcement for their swift action and will continue cooperating with them as they investigate.”
The Biloxi Police Department said it does not believe any other stores have been targeted.
If customers purchase a product that has been tampered with, they should immediately throw it out and visit their local Walmart for a full refund, the company said.
New York
Judge says he’s hopeful hearing on Luigi Mangione trial evidence will end this week
NEW YORK (AP) — A judge said Tuesday he’s optimistic that a pretrial hearing will end this week in Luigi Mangione’s New York murder case in the killing of UnitedHealthcare CEO Brian Thompson.
“Hopefully we wind up on Thursday,” Judge Gregory Carro said at the hearing, which is in its third week of testimony.
Mangione, 27, is seeking to exclude items seized during his Dec. 9, 2024, arrest in Altoona, Pennsylvania, including a gun and notebook that prosecutors say tie him to Thompson’s shooting five days earlier in Manhattan.
Prosecutors have called more than a dozen witnesses so far.
On Tuesday, a Pennsylvania police evidence custodian, a New York City police homicide commander and an investigative analyst from the Manhattan district attorney’s office testified.
Mangione has pleaded not guilty to state and federal murder charges. The pretrial hearing applies only to the state case. His lawyers are making a similar push to exclude the evidence from his federal case, where prosecutors are seeking the death penalty.
Mangione was arrested after customers spotted him eating breakfast at a McDonald’s in Altoona, a Pennsylvania city of about 44,000 people some 230 miles (370 kilometers) west of Manhattan. The restaurant’s manager told a 911 dispatcher customers thought “he looks like the CEO shooter from New York.”
Mangione’s lawyers contend that anything found in Mangione’s backpack should be excluded from his trial because police didn’t have a search warrant and lacked the grounds to justify a warrantless search.
Prosecutors say the search was legal because it was conducted in conjunction with an arrest and officers were checking to make sure there were no dangerous items in the bag that could be harmful to them or the public. Police eventually obtained a warrant, prosecutors said.
Items seized during that search include a 9 mm handgun that prosecutors said matches the one used to kill Thompson and a notebook in similar handwriting in which he purportedly described his intent to “wack” a health insurance executive.
The Altoona police department’s evidence custodian, Officer George Featherstone, testified Tuesday that he logged evidence collected during Mangione’s arrest and placed it in labeled evidence bags and envelopes before turning it over to the NYPD.
NYPD Lt. David Leonardi, the commanding officer of the detective squad that investigated Thompson’s killing, testified that before going to Altoona he told a police sergeant there: “I would like no one to speak to him and all of the property held.”
Leonardi said he raced to Altoona with a team of detectives and personally drove the evidence back to Manhattan, where it was delivered to the NYPD’s crime laboratory for testing.
Investigative Analyst Anissa Weisel testified about a timeline she created of events surrounding Mangione’s arrest. Mangione’s lawyers objected, saying the timeline was missing too much information. Carro agreed, but said he’d only use the timeline as an aid to help him review body-worn camera footage and other material submitted during the hearing.
Founder of bankrupt subprime auto lender is charged with fraud
NEW YORK (AP) — The founder of Tricolor Holdings and other executives of the subprime auto lender were charged Wednesday with what federal authorities say was a massive fraud that led the company into bankruptcy.
Daniel Chu, the company’s founder and chief executive, was charged in an indictment unsealed in Manhattan federal court with directing multiple executives since 2018 to defraud investors and lending institutions through multiple fraudulent schemes.
A defense lawyer did not immediately return a message seeking comment.
According to the indictment, the scope of the fraud was revealed in late August when lenders confronted Chu and other executives about Tricolor’s collateral.
Chu and others accused of carrying out the fraud initially tried to conceal it, saying the collateral issues were due to an administrative error, the indictment said.
After those efforts failed, Chu extracted over $6 million from the company, the indictment said.
On Sept. 10, Tricolor filed for Chapter 7 bankruptcy because it owed over $900 million to the company’s largest lenders, the indictment said.
California
Doctor who helped sell ketamine to Matthew Perry avoids prison time
LOS ANGELES (AP) — A doctor who pleaded guilty in a scheme to supply ketamine to actor Matthew Perry before his overdose death was sentenced Tuesday to 8 months of home confinement.
Judge Sherilyn Peace Garnett handed down the sentence that included 3 years of supervised release to 55-year-old Dr. Mark Chavez in a federal courtroom in Los Angeles.
Before the sentence was delivered, Chavez addressed the judge and said he had lost a loved one recently and understood the grief that Perry’s death has caused.
Chavez acquired ketamine and gave it to Dr. Salvador Plasencia, who was sentenced to 2 1/2 years in prison earlier this month for selling ketamine to Perry in the months leading up to his death.
Chavez’s attorneys emphasized the difference between the two doctors and said that Chavez “accepted responsibility early” by cooperating with investigators and voluntarily giving up his medical license ahead of his detention hearing.
Perry had been taking the surgical anesthetic ketamine legally as a treatment for depression. But when his regular doctor wouldn’t provide it in the amounts he wanted, he turned to Plasencia.
Plasencia admitted to taking advantage of Perry, knowing he was a struggling addict. Plasencia texted Chavez that Perry was a “moron” who could be exploited for money, according to court filings.
Chavez admitted to obtaining the ketamine from a wholesale distributor on false pretenses and pleaded guilty to one count of conspiracy to distribute ketamine. He has not been in custody.
Chavez is the second person to be sentenced of the five defendants who have pleaded guilty in connection with Perry’s death at age 54 in 2023.
Perry was found dead by his assistant on Oct. 28. The medical examiner ruled ketamine was the primary cause of death. The actor had been using the drug through his regular doctor in a legal but off-label treatment for depression that has become increasingly common.
Seeking more ketamine than his doctor would give him, about a month before his death Perry found Plasencia, who in turn asked Chavez to obtain the drug for him.
He met with Plasencia between San Diego and Los Angeles to hand off ketamine he got using fraudulent prescriptions. In all, he admitted to supplying 22 5-milliliter vials of ketamine and nine ketamine lozenges.
Chavez will also be expected to do 300 hours of community service.
The other three defendants who reached deals to plead guilty will be sentenced at their own hearings in the coming months. Garnett has said she would seek to make sure all the sentences made sense in relation to one another.
California
Members of a secretive religious group have been charged with murder in 2 deaths
SAN BERNARDINO, Calif. (AP) — Members of a secretive California religious group have been charged with murder in the deaths of a man who disappeared in 2023 and a child who died in 2010.
Shelley “Kat” Martin, 62, who was described as a leader and “prophetess” of His Way Spirit Led Assemblies, was charged in the separate deaths of Emilio Ghanem, 40, whose burned-out pickup truck was found in a desert, and 4-year-old Timothy Thomas, known as Timo.
Martin’s husband, Darryl Martin, 58, was charged with murder solely in Timothy’s death. The charges were filed against the couple Monday in county Superior Court.
A statement from Anderson’s office described His Way, based in Hemet, as a “religious high-control group.”
Police have said Thomas died in 2010 after his parents placed him in the temporary custody of the Martins.
“Shelley and Darryl Martin took an active role in preventing Timo from receiving medical treatment. ... Timo’s death could have been prevented had he been allowed to receive medical attention for his appendicitis,” said Colton police Chief Anthony Vega.
The boy’s father, former His Way member Andre Thomas, also was charged with murder in the child’s death. No attorney for him was listed yet in the court file. A message seeking comment from an attorney for the Martins was not immediately returned Tuesday.
Ghanem was a member of His Way for nearly 20 years before he moved to Nashville, Tennessee, police said. He traveled back to California in May 2023 and was last seen at a coffee shop in Redlands, a status that gave the investigation of his disappearance to local police. His body has not been found.
Investigators found evidence of a homicide when Ghanem’s rental vehicle was discovered in the Mojave Desert, Redlands police Chief Rachel Tolber said Monday. She did not elaborate.
“The secretive and manipulative actions by the Martins and the members of His Way Spirit Led Assemblies presented particular challenges to the department’s investigation,” Tolber said.
In Timothy’s death, investigators received new information from former His Way members who were reluctant to speak truthfully years ago, Colton police Sgt. Shawn McFarland told the Los Angeles Times.
Mississippi
Woman charged after Walmart shoppers found razor blades in loaves of bread
A woman who allegedly pushed razor blades into loaves of bread at two Biloxi, Mississippi, Walmart stores was arrested on Tuesday.
Camille Benson, 33, of Texas, has been charged with attempted mayhem. Her bond is set at $100,000.
Harrison County Jail records on Wednesday morning do not list an attorney for Benson who could be reached for comment on her behalf. A message left at a phone number listed for a possible relative of Benson was not immediately returned.
Customers reported finding the razor blades at a Walmart Supercenter and a Walmart Neighborhood Market, said Lt. Candace Young, a public information officer for the Biloxi Police Department.
Walmart employees told police a customer first reported finding a razor blade in a loaf purchased from the Walmart Supercenter on Dec. 5. On Dec. 8, a customer who bought a loaf at the Walmart Neighborhood Market also reported finding a razor blade.
After another customer complained to the Walmart Supercenter on Sunday, employees inspected the merchandise and found several more loaves had been tampered with, law enforcement officials said.
The police department was notified on Monday.
In a press release, the department asked anyone who bought bread from those Walmart locations to inspect the loaves and report any findings.
“The health and safety of our customers is always a top priority,” Walmart said in a statement. “We have removed and thoroughly inspected all potentially affected products at impacted stores in Biloxi. We appreciate law enforcement for their swift action and will continue cooperating with them as they investigate.”
The Biloxi Police Department said it does not believe any other stores have been targeted.
If customers purchase a product that has been tampered with, they should immediately throw it out and visit their local Walmart for a full refund, the company said.
New York
Judge says he’s hopeful hearing on Luigi Mangione trial evidence will end this week
NEW YORK (AP) — A judge said Tuesday he’s optimistic that a pretrial hearing will end this week in Luigi Mangione’s New York murder case in the killing of UnitedHealthcare CEO Brian Thompson.
“Hopefully we wind up on Thursday,” Judge Gregory Carro said at the hearing, which is in its third week of testimony.
Mangione, 27, is seeking to exclude items seized during his Dec. 9, 2024, arrest in Altoona, Pennsylvania, including a gun and notebook that prosecutors say tie him to Thompson’s shooting five days earlier in Manhattan.
Prosecutors have called more than a dozen witnesses so far.
On Tuesday, a Pennsylvania police evidence custodian, a New York City police homicide commander and an investigative analyst from the Manhattan district attorney’s office testified.
Mangione has pleaded not guilty to state and federal murder charges. The pretrial hearing applies only to the state case. His lawyers are making a similar push to exclude the evidence from his federal case, where prosecutors are seeking the death penalty.
Mangione was arrested after customers spotted him eating breakfast at a McDonald’s in Altoona, a Pennsylvania city of about 44,000 people some 230 miles (370 kilometers) west of Manhattan. The restaurant’s manager told a 911 dispatcher customers thought “he looks like the CEO shooter from New York.”
Mangione’s lawyers contend that anything found in Mangione’s backpack should be excluded from his trial because police didn’t have a search warrant and lacked the grounds to justify a warrantless search.
Prosecutors say the search was legal because it was conducted in conjunction with an arrest and officers were checking to make sure there were no dangerous items in the bag that could be harmful to them or the public. Police eventually obtained a warrant, prosecutors said.
Items seized during that search include a 9 mm handgun that prosecutors said matches the one used to kill Thompson and a notebook in similar handwriting in which he purportedly described his intent to “wack” a health insurance executive.
The Altoona police department’s evidence custodian, Officer George Featherstone, testified Tuesday that he logged evidence collected during Mangione’s arrest and placed it in labeled evidence bags and envelopes before turning it over to the NYPD.
NYPD Lt. David Leonardi, the commanding officer of the detective squad that investigated Thompson’s killing, testified that before going to Altoona he told a police sergeant there: “I would like no one to speak to him and all of the property held.”
Leonardi said he raced to Altoona with a team of detectives and personally drove the evidence back to Manhattan, where it was delivered to the NYPD’s crime laboratory for testing.
Investigative Analyst Anissa Weisel testified about a timeline she created of events surrounding Mangione’s arrest. Mangione’s lawyers objected, saying the timeline was missing too much information. Carro agreed, but said he’d only use the timeline as an aid to help him review body-worn camera footage and other material submitted during the hearing.
