Monday, October 14, 2013
Friday, October 4, 2013
Sunday, September 22, 2013
Friday, September 20, 2013
Sunday, September 15, 2013
Friday, August 23, 2013
Thursday, August 22, 2013
Porn Moratorium After HIV-Positive Test From Performer
The adult film industry's trade association has called for a moratorium on filming Wednesday after an actor tested positive for HIV.
The Free Speech Coalition said that it is reaching out to producers to find and test the actor's sex partners, the Associated Press reports.
Sources told industry blog Xbiz that the performer is believed to be a female who is relatively new to the industry. The coalition's executive director, Diane Duke, said the actor is not believed to have been infected on a film set.
Check back for updates on this story.
Last year, porn star Mr. Marcus, 42, admitted to altering his syphilis-positive test so that he could keep performing. The news prompted the industry to self-impose a 10-day moratorium last August while actors were tested and treated for syphilis. In June of this year, Mr. Marcus was convicted of knowingly exposing two co-stars to syphilis and was sentenced to 30 days in jail.
In November, LA voters passed Measure B, requiring condoms to be worn during porn shoots. The measure was sponsored by the AIDS Healthcare Foundation.
A few porn producers filed a lawsuit to block the implementation of the measure but last week, a federal judge found that the law is constitutional.
Wednesday, August 21, 2013
Tuesday, August 20, 2013
Friday, August 16, 2013
Thursday, August 15, 2013
Wednesday, August 14, 2013
Tuesday, August 13, 2013
Sunday, August 11, 2013
Amber Alert: Rhode Island issued for 2-year-old after apparent double-homicide
State police say a suspect in a double homicide has snatched a 2-year-old boy from a Rhode Island home and is on the run.
An Amber Alert has been issued for Isaih Perez, who was discovered missing from a Johnston home at about 5:20 a.m. Sunday.
Malcolm Crowell, 22, is being sought by authorities in connection with the disappearance of 2-year-old Isaih Perez in Rhode Island.
/ RHODE ISLAND STATE POLICE
Authorities are looking for 22-year-old Malcolm Crowell of Providence. They say he should be considered armed and dangerous. They believe he has Isaih.
No description of his vehicle was immediately available.
WPRI-TV reports that Isaih lived with the two people who were found dead.
Police say Crowell had a link to the boy, but they wouldn't elaborate.
Johnston is a town of about 30,000 people less than 10 miles from Providence.
Thursday, August 8, 2013
4 dead, 4 hurt in 2 shootings, in Dallas, suburb
A series of shootings in the Dallas area killed at least four people and wounded others, but authorities said early Thursday that a suspect was in custody.
Police were first called to a home in southwest Dallas around 10:30 p.m. Wednesday where they found four gunshot victims, two of whom had died, Dallas police Sgt. Warren Mitchell told media outlets.
.jpg)
The suspect in that shooting fled to nearby DeSoto, where he was involved in another shooting, Mitchell said.
At the second location, four other people were shot, with two of them dying, DeSoto police Cpl. Melissa Franks said.
Franks said police took the suspect into custody at the scene of the second shooting. Authorities said the suspect is a male but have not released any other information about him.
Wednesday, August 7, 2013
Tuesday, August 6, 2013
Sunday, August 4, 2013
Thursday, July 25, 2013
Tuesday, July 23, 2013
Tuesday, July 16, 2013
Miguel Angel Trevino Morales Captured: Leader Of Mexico's Zetas Drug Cartel Captured, Says U.S. Federal Official
MEXICO CITY — Miguel Angel Trevino Morales, the notoriously brutal leader of the feared Zetas drug cartel, was captured before dawn Monday in the first major blow against an organized crime leader by a Mexican administration struggling to drive down persistently high levels of violence, officials announced.
Trevino Morales, 40, was captured by Mexican Marines who intercepted a pickup truck with $2 million in cash on a dirt road in the countryside outside the border city of Nuevo Laredo, which has long served as the Zetas' base of operations. The truck was halted by a Marine helicopter and Trevino Morales was taken into custody along with a bodyguard and an accountant and eight guns, government spokesman Eduardo Sanchez told reporters.
Sanchez said the Marines had been watching rural roads between the Texas border states of Coahuila, Nuevo Leon and Tamaulipas for signs of Trevino Morales, who is charged with murder, torture, kidnapping and other crimes.
The Zetas leader and his alleged accomplices were flown to Mexico City, where they are expected to eventually be tried in a closed system that usually takes years to prosecute cases, particularly high-profile ones.
Trevino Morales, known as "Z-40," is uniformly described as one of the two most powerful cartel heads in Mexico, the leader of a corps of special forces defectors who went to work for drug traffickers, splintered off into their own cartel in 2010 and metastasized across Mexico, expanding from drug dealing into extortion, kidnapping and human trafficking.
Along the way, the Zetas authored some of the worst atrocities of Mexico's drug war, leaving hundreds of bodies beheaded on roadsides or hanging from bridges, earning a reputation as perhaps the most terrifying of the country's numerous ruthless cartels.
On Trevino Morales' watch, 72 Central and South American migrants were slaughtered by the Zetas in the northern town of San Fernando in 2010, authorities said. By the following year, federal officials announced finding 193 bodies buried in San Fernando, most belonging to migrants kidnapped off buses and killed by the Zetas for various reasons, including their refusal to work as drug mules.
Trevino Morales is charged with ordering the kidnapping and killing of the 265 migrants, Sanchez said.
President Enrique Pena Nieto came into office promising to drive down levels of homicide, extortion and kidnapping but has struggled to make a credible dent in crime figures. And his pledge to focus on citizen safety over other crimes has sparked worries among U.S. authorities that he would ease back on predecessor Felipe Calderon's U.S.-backed strategy aimed above all at decapitating drug cartels.
The arrest of Trevino, a man widely blamed for both massive northbound drug trafficking and the deaths of untold scores of Mexicans and Central American migrants, will almost certainly earn praise from Pena Nieto's U.S. and Mexican critics alike.
Trevino Morales' capture adds to the long list of Zetas' leaders who have been arrested or killed in recent years, including Zeta head Heriberto Lazcano Lazcano, whose fatal shooting by authorities last year left Trevino Morales in charge.
"There continues to be the perception that capturing this type of individual has a strategic value and the logic persists that it's preferable to fragment criminal groups and reduce them in size. On this point there isn't much change," said Alejandro Hope, a former member of Mexico's domestic intelligence service.
The debilitation of the Zetas has been widely seen as strengthening the country's most-wanted man, Sinaloa cartel head Joaquin "El Chapo" Guzman, who has overseen a vicious turf war with the Zetas from hideouts believed to lie in rugged western Mexico.
"El Chapo is greatly strengthened because he will now have access to the crown jewel of narco-trafficking, Nuevo Laredo," said George Grayson, an expert on the Zetas and professor of government at the College of William & Mary.
Trevino Morales is expected to be succeeded by his brother, Omar, a former low-ranking turf boss seen as far weaker than his older brother.
Miguel Angel Trevino Morales began his career as a teenage gofer for the Los Tejas gang, which controlled most crime in his hometown across the border from Laredo, Texas. He soon graduated from washing cars and running errands to running drugs across the border, and was recruited into the Matamoros-based Gulf cartel.
Trevino Morales' brother, sister and mother lived in Dallas but he had many relatives around Nuevo Laredo and, while moving frequently to avoid authorities, he was believed to often return to his hometown, the U.S. official said.
Trevino Morales joined the Zetas, a group of Mexican special forces deserters who defected to work as hit men and bodyguards for the Gulf cartel in the late 1990s.
Stories about the brutality of "El Cuarenta," or "40" as Trevino Morales became known, quickly become well-known among his men, his rivals and Nuevo Laredo citizens terrified of incurring his anger.
One technique favored by Trevino Morales was the "guiso," or stew, in which enemies would be placed in 55-gallon drums and burned alive, said a U.S. law-enforcement official in Mexico City, who spoke on condition of anonymity because of the sensitivity of the topic. Others who crossed the commander would be beaten with wooden planks, the official said.
Around 2005, Trevino Morales was promoted to boss of the Nuevo Laredo territory, or "plaza" and given responsibility for fighting off the Sinaloa cartel's attempt to seize control of its drug-smuggling routes, according to U.S. and Mexican officials. He orchestrated a series of killings on the U.S. side of the border, several by a group of young U.S. citizens who gunned down their victims on the streets of the American city.
In 2006, the Gulf Cartel and the Zetas defeated the Sinaloa cartel in Nuevo Laredo, a victory that emboldened them as they began spreading south to towns and cities that had never before seen extensive organized crime. They set up criminal networks to control transit routes for drugs, migrants, extortion, kidnapping, contraband of pirated DVDs and CDs and countless other criminal activities, intimidating local residents and committing gruesome murders as an example to the uncooperative.
According to the U.S. official, Trevino Morales was in charge of Nuevo Leon, Piedras Negras and other areas until March 2007, when he was sent to the city of Veracruz following the death of a leading Zeta in a gunbattle there.
That same year, Trevino Morales and Lazcano began pushing for independence from the Gulf cartel after cartel head Osielo Cardenas Guillen's extradition to the U.S.
The Zetas split from the Gulf cartel and by 2008 had operations in 28 major Mexican cities, according to an analysis by Grupo Savant, a Washington-based security think tank.
In February 2008, Lazcano sent Trevino Morales to Guatemala, where he was responsible for eliminating local competitors and establish Zetas control of smuggling routes. Trevino Morales was then named by Lazcano as national commander of the Zetas across Mexico despite his lack of military background, earning him the resentment of some of the original ex-military members of the Zetas, the official said.
The promotion involved Trevino Morales in virtually every decision by the Zetas, the official said.
Trevino rose to the top of the Zetas last year after leader Lazcano died in a shootout with Mexican marines in Coahuila state.
Trevino Morales was indicted on drug trafficking and weapons charges in New York in 2009 and Washington in 2010, and the U.S. government issued a $5 million reward for information leading to his arrest.
According to the indictments, Trevino Morales coordinated the shipment of hundreds of pounds of cocaine and marijuana each week from Mexico into the U.S., much of which had passed through Guatemala. He also moved bulk shipments of dollar bills back into Mexico, the documents say.
Vladimir Putin: U.S. Has Blocked Edward Snowden In Russia
* Putin wants former U.S. spy agency contractor to go
* Blames U.S. for blocking Snowden's passage
* Signals Snowden shifting towards main asylum requirement (Adds more quotes and detail)
By Alexei Anishchuk
GOGLAND ISLAND, Russia, July 15 (Reuters) - President Vladimir Putin said on Monday he wanted Edward Snowden to leave after three weeks holed up at a Moscow airport, but also signalled that the former U.S. spy agency contractor was moving towards meeting Russia's asylum conditions.
Snowden flew to Moscow's Sheremetyevo airport from Hong Kong on June 23 in the hope of travelling on to a country that would offer him protection from the United States after he divulged details of U.S. government intelligence programmes.
Putin said Washington had trapped Snowden by preventing him from reaching other countries that might shelter him but, wary of upsetting Moscow's former Cold War enemy, has said Russia will grant him political asylum only if he stops actions that could be harmful to the United States.
"As soon as there is an opportunity for him to move elsewhere, I hope he will do that," Putin said during a visit to Gogland Island in the Gulf of Finland.
"The conditions for (Russia) granting him political asylum are known to him. And judging by his latest actions, he is shifting his position. But the situation has not been clarified yet."
Snowden, 30, told human rights campaigners on Friday at a meeting in Sheremetyevo's transit area that he was seeking temporary asylum in Russia until he can travel safely to Latin America, where three countries have said they might take him in.
He has been unable to reach any of those countries - Nicaragua, Venezuela or Bolivia - because there are no direct flights from Moscow and he would risk having his passage barred by the United States and its allies.
The case is an increasingly awkward problem for Putin as Moscow and Washington try to improve relations and he prepares for a summit with President Barack Obama in Moscow in early September, just before a summit of G20 leaders in Russia.
"We have certain relations with the United States and we don't want you to damage our ties with your activity," Putin said, referring to Snowden.
Asked to comment on what comes next for Snowden, Putin, a former KGB spy, said: "How do I know? It's his life, his fate."
UNINVITED GUEST
He went on to distance Russia from Snowden and his political activities and, as on previous occasions when he has spoken about the case in public, avoided taking the opportunity to gloat at the United States' failure to catch him.
"He came to our territory without invitation, we did not invite him. And we weren't his final destination. He was flying in transit to other states. But the moment he was in the air ... our American partners, in fact, blocked his further flight," Putin said.
"They have spooked all the other countries, nobody wants to take him and in that way, in fact, they have themselves blocked him on our territory," he said.
Washington has revoked Snowden's passport and wants him extradited to the United States to face espionage charges.
Russia often accuses the United States of failing to practise at home what it preaches on human rights abroad, and many pro-Kremlin politicians have cast Snowden as a defender of civil rights. Putin has also accused the United States of backing protesters who have demanded an end to his long rule.
But the Kremlin has avoided parading Snowden before cameras and has repeatedly avoided embarrassing the United States over the young American's flight from U.S. justice.
Tatyana Lokshina of the American-based campaign group Human Rights Watch said after meeting Snowden on Friday that he saw no problem with Putin's asylum conditions because he believed he had done no harm to the United States. Putin did not say what prompted him to believe Snowden's stance was shifting.
Russia has made clear it regards the transit area between the airport runway and passport control as neutral territory and signalled it does not want to upset the United States further by allowing Snowden to step onto what it considers Russian soil. (Writing by Gabriela Baczynska; Editing by Timothy Heritage and Kevin Liffey)
Edward Snowden Applies For Temporary Asylum In Russia, Lawyer Says
.jpg)
MOSCOW — National Security Agency leaker Edward Snowden on Tuesday submitted a request for temporary asylum in Russia, his lawyer said.
Anatoly Kucherena, a lawyer who is a member of the Public Chamber, a Kremlin advisory body, said that Snowden submitted the asylum request to Russia's Federal Migration Service. The service had no immediate comment.
Kucherena told The Associated Press that he met Snowden in the transit zone of Moscow's Sheremetyevo airport and Snowden made the request after the meeting.
He said Russian law contains no specific time frame for considering an asylum request.
Snowden has been stuck in Sheremetyevo's transit zone since he arrived on a flight from Hong Kong on June 23. He said Friday at a meeting with Russian rights activists and public figures, which Kucherena attended, that he would seek at least temporary refuge in Russia until he could fly to one of the Latin American nations that have offered him asylum.
It wasn't immediately clear why it took Snowden so long to formally submit the request.
Snowden's stay in Russia has strained already chilly relations between Moscow and Washington. Granting him asylum would further aggravate tensions with Washington less than two months before Russia's President Vladimir Putin and President Barack Obama are to meet in Moscow and again at the G-20 summit in St. Petersburg.
Putin on Monday described Snowden's arrival as an unwelcome present foisted on Russia by the United States. He said that Snowden flew to Moscow intending only to transit to another country, but that the U.S. intimidated other countries into refusing to accept him, effectively blocking the fugitive from flying further.
Snowden previously had sought Russian asylum, which Putin said would be granted only if he agreed not to leak more information. Snowden then withdrew the bid, the Kremlin said.
Putin did not say Monday if that would be sufficient grounds for asylum, adding that Snowden apparently did not want to stay in Russia permanently.During Friday's meeting in Sheremetyevo's transit zone, Snowden argued that he hadn't hurt U.S. interests in the past and has no intention of doing that.
Venezuela, Bolivia and Nicaragua have offered Snowden asylum, but getting there from Moscow without passing through U.S. airspace or that of Washington's allies would be difficult. The U.S. has annulled his passport.
Monday, July 15, 2013
Oakland's Trayvon Martin Protests Underscore City's History Of Racially Charged Violence
When protests in Oakland, Calif. took a violent turn Saturday night, it was nothing the city hadn't seen before.
More than a hundred demonstrators gathered downtown to march against the verdict in the George Zimmerman trial, which allowed a man who shot and killed an unarmed black teenager to walk free. But while other events that materialized across the country remained mostly peaceful, Oakland's were marred by window-smashing, flag burning and other forms of vandalism, including aggressive graffiti declaring "Kill Zimmerman" and "F*ck the Police."
Though Saturday's activity was relatively tame compared to past instances -- nobody was arrested or visibly harmed -- it's a story that unfolds time and again in the small port city on the San Francisco Bay.
"You can't go six months without something getting smashed," longtime Oakland resident Max Allstadt, who attended the protests, told The Huffington Post. "The people doing it have various ideological justifications, but outside the Twitter echo chamber they've created for themselves, there's not a lot of support."
Twitter lit up with commenters both encouraging and denouncing the destruction. "Do you know why some groups feel the need to march and break windows in #Oakland? Because nobody is listening to their demands for fairness," tweeted Steven Tavares, a reporter for the East Bay Citizen. "Not sure why Oakland business are suffering because of Florida's sh*tty laws, if you care to explain," responded @JulioD. Occupy Oakland attempted to settle the matter with the widely re-tweeted, "Calm down, twitter. A few broken windows in #Oakland is not a #riot, its a dance party."
In recent years in Oakland, events that have often started as peaceful marches have quickly turned aggressive. During an Occupy rally on May Day last year, authorities used tear gas to disperse rioters. In the months that preceded the May confrontation, the city had become a national symbol of violent clashes between protesters and police.
(Story continues below)
According to Allstadt, the majority of Saturday's demonstrators weren't engaging in violent behavior, but they weren't trying to stop it, either. "It was a few small groups of people smashing stuff within a larger crowd," he said. "Some people were supportive, a few were absolutely condemning, but the biggest group was the one that doesn't smash but believes they shouldn't tell others to stop."
That Oakland residents would protest the killing of 17-year-old Trayvon Martin, who died at the hand of a neighborhood watchman while returning from the store with little more than a bag of Skittles in his possession, comes as no surprise. The same weekend the jury handed George Zimmerman his not guilty verdict, the movie"Fruitvale Station" opened in theaters, telling the story of another unarmed black man killed by a gun-wielding authority figure -- but in Oakland.
"Fruitvale" chronicles the life and death of 22-year-old Oscar Grant, who was shot to death on an Oakland train platform by a transit officer in the early hours of New Year's Day, 2009. The officer who shot Grant served 11 months for involuntary manslaughter, a decision that sparked angry riots on the streets of the city.
"It’s a given that most of Oakland is mad about the Trayvon Martin verdict," Allstadt explained. "Nobody is cheering on George Zimmerman."
Oakland has a long history of racially-charged cases that involve shootings by officers, including those of Alan Blueford and Raheim Brown, black teenagers killed by police in 2012 and 2010, respectively.
"The thing about Oakland is that we’ve got nine, 10 names like [Trayvon's] that people know," Allstadt said. "We have a list of martyrs in this town, and everyone's talking about all of them right now."
Beyond the pockets of unrest, local civil rights activists are finding nonviolent ways to continue the conversation. Local shoe store SoleSpace is inviting residents, especially children, to participate in an "Art Wall 4 Justice" that will decorate its storefront.
And Richard Raya, executive director of Oakland-based nonprofit Youth Radio, is planning a series of public forums in which community members are encouraged to discuss Trayvon Martin, Oscar Grant and wider social justice issues. "Oakland is a special place," Raya told HuffPost. "It’s a place where people pay attention to what’s happening locally and nationally, and people act. It's who we are."
More protests are expected Sunday night and into the week. Still, Allstadt points out that the potential for violent activity, though perhaps isolated, is worth paying attention to. "I would agree that breaking things is a distraction," he said, "but it's happening in more places, and it's happening more intensely. It's a good barometer of just how mad people are."
Inside The Massive Global Black Market For Smartphones
Before a federal SWAT team descended last summer, one storefront in a Detroit suburb attracted so many people bearing shopping bags stuffed with iPhones and iPads that managers installed a port-a-potty on the sidewalk.
Once inside, people deposited their electronic wares into a rotating drawer below a bulletproof glass window and waited for the cashier to deliver stacks of cash.
So much money changed hands in this fashion at the Ace Wholesale storefront in Taylor, Mich., that an armored truck arrived each morning to deliver fresh bundles of cash, according to an undercover investigator for the wireless company Sprint and an employee at the Mattress World outlet next door.
"It was like Fort Knox over there," said the Mattress World employee, who asked not to be named for fear of making enemies inside what police say was a locus of criminal activity.
Many of the mobile devices swapped for cash at Ace Wholesale had been stolen at gunpoint in an escalating wave of gadget-related robberies, police say. Ace Wholesale had become a key broker in the underground trade of stolen phones, a global enterprise that often connects violent street thieves in American cities with buyers as far away as Hong Kong, according to law enforcement and the wireless industry.
"These companies fence the stolen phones for them, no questions asked," said Jerry Deaven, an agent with the Department of Homeland Security, which is tasked with preventing the trafficking of stolen goods. "You can walk right into one of these storefronts and sell all the phones at once and walk out with $20,000."
Deaven told The Huffington Post that such traffickers are responsible for "a tremendous amount of phones being shipped out of the country," adding that "some organizations are shipping a couple million dollars worth of phones per month."
Ace Wholesale's storefront in Taylor, Mich.
Deaven declined to comment specifically about Ace Wholesale, which he said is now under federal investigation. Last August, federal agents armed with search warrantsraided the company's locations in suburban Detroit, Atlanta and Chicago, and the owner's home in Taylor, Mich., according to a DHS spokesman.
Ace Wholesale's owner, Jason Floarea, has not been charged with a crime. He did not respond to requests for comment. His attorney, Jim Thomas, who has represented high-profile clients including former Detroit Mayor Kwame Kilpatrick, declined to comment.
The case against Ace Wholesale sheds light on what law enforcement and wireless providers portray as a shadowy world of smartphone trafficking. At the center of this trade is a crucial layer of middlemen: bulk purchasers who buy devices from thieves and con artists before exporting them to customers around the world.
In 2009, federal agents charged Hezbollah operatives in Philadelphia with attempting to buy thousands of stolen cell phones and ship them to Hong Kong and the United Arab Emirates to finance the Shiite militant organization, which the United States considers a terrorist group.
Earlier this year, a woman's iPhone stolen at a bar in San Francisco turned up a few days later in Lima, Peru, according to San Francisco police.
Last fall, American and Mexican wireless carriers began collaborating to address the cross-border trade in stolen phones after learning that Mexican drug cartels were using them to communicate with kidnapping victims' relatives without being traced. But American wireless companies lack similar arrangements with other countries, allowing international phone trafficking to flourish.
Phones stolen in the United States have been located "on all continents except Antarctica," said Marci Carris, vice president of customer finance services at Sprint.
The global nature of the trade stems in part from measures that law enforcement and wireless carriers have imposed to make it harder to resell stolen phones in the United States, prompting criminals to forge new markets abroad.
"Once it gets overseas, it's virtually impossible to track a phone back here to the person who committed the crime," Deaven said.
But phone trafficking is driven largely by the massive profits made by exploiting the price difference between smartphones sold in the U.S. and overseas. Americans who agree to two-year service contracts with their cell phone company can buy the latest iPhones for about $200 -- a price subsidized by the carrier. In Hong Kong, an iPhone can be sold for as much as $2,000.
This equation helps explain why more than 1.6 million Americans were victims of smartphone theft last year and why thefts of mobile devices now make up 40 percentof all robberies in major American cities. The rising street crime is exacting a heavy toll on consumers who spend an estimated $30 billion each year replacing lost and stolen devices, according to Lookout, a San Francisco-based mobile security firm.
Smartphone-related crime has also turned increasingly violent. Last month, a 24-year-old man was shot in Philadelphia after police say he would not give up his cell phone to a thief. Last year, 26-year-old Hwangbum Yang of New York City and 23-year-old Megan Boken of suburban Chicago were shot and killed during separate iPhone robberies, police say.
In response to the crime wave, state and city law enforcement officials areinvestigating smartphone makers for their failure to adopt measures that would render their devices inoperable when stolen. New York Attorney General Eric Schneiderman pressed smartphone manufacturers in May to create "kill switch" technology to undercut the black market, noting that "foreign trafficking of stolen devices has proliferated."
Phone trafficking also costs the wireless industry "hundreds of millions of dollars a year," said James Baldinger, an attorney for Sprint. One alleged phone trafficker, Hassan Essayli, admitted in 2008 that his company, Platform Enterprises, shipped 30,000 phones from California to other countries in just two months, according to his testimony in a lawsuit filed by TracFone Wireless.
"I'm seeing thousands and thousands of phones being resold overseas," Baldinger said. "The numbers are so big, but a lot of time it flies under the radar."
Over the last eight years, wireless companies have filed more than 200 lawsuits against alleged phone traffickers, but no case has bigger stakes than the federal lawsuit Sprint filed last summer against Ace Wholesale, Baldinger said. Sprint has accused Ace of buying thousands of Sprint phones and reselling them overseas, thereby depriving the wireless company of revenue from monthly phone bills.
"As far as we know," Baldinger said, "Ace is the biggest phone trafficker in the country."
Founded four years ago, Ace Wholesale was the brainchild of Jason Floarea, a Detroit area entrepreneur who opened his first wireless retail outlet when he was only 16,according to the company's website. He says on the site that he started the company to help consumers purchase top quality smartphones at discount prices.
Now 27, Floarea is a married father of three and an ordained minister. He aims to open his own church focused on outreach to convicts, alcoholics and the homeless, the site says.
Local law enforcement, however, accuse him of less savory activities: acting as a well-known buyer of smartphones and tablets stolen in burglaries and armed robberies.
In January 2010, Dearborn, Mich., police pulled over Floarea in his wife's silver Lexus and found two handguns, more than 30 cell phones, marijuana, a bottle of prescription drugs and more than $40,000 in cash, according to a local police report obtained by The Huffington Post through the Freedom of Information Act. He was arrested on charges of possession of marijuana, possession with intent to distribute narcotics and possession of a firearm in commission of a crime, the report says. Police later returned the phones and all but $4,200 in cash to Floarea per a court judgment.
A search of court records found no evidence of the case and both prosecutors and Floarea's attorney declined to comment on it. In Michigan, some defendants have been sentenced under statutes that prevent their cases from being disclosed publicly, according to a Michigan Department of Corrections spokesman.
While it remains unclear how profitable Floarea's business has become, he appears to be making a comfortable living. Early last year, he purchased a five-bedroom house in West Bloomfield, Mich., for $1.4 million, according to the town assessor's office. Even Ace Wholesale's low-level associates say they are well-compensated. One person who buys and sells phones for the company told Sprint's investigator that he makes $3,000 per week, court documents show.
Deaven said he recently interviewed a man who claimed to supply phones to traffickers and boasted about how his work supported his lavish lifestyle.
"He said, ‘I drink nothing but top-shelf liquor and get all the girls,'" Deaven recalled. "‘I make more money than the dope man, but have none of the risk.'"
‘A VERY LUCRATIVE CRIME'
The underground market transporting iPhones and other gadgets around the world began with a different form of theft.
For years, traffickers have hired teams of so-called "runners" or "credit mules" to buy discounted phones in bulk from retailers by agreeing to long-term service contracts. These runners simply stop paying the bills and sell the devices to traffickers who export them overseas.
In March, the California Attorney General charged two people -- Shoulin Wen, 38, and Yuting Tan, 27 -- with recruiting runners from homeless shelters to buy iPhones and Samsung Galaxy phones. The pair shipped the phones to Hong Kong -- a scheme that the attorney general says netted them nearly $4 million in less than a year.
But recently, thefts have become bolder and more violent: Traffickers have been acquiring phones through a growing number of cell phone store robberies, according to local and federal law enforcement officials.
"A guy can go into a cell phone store and steal 30 or 40 phones and get a lot more than if he hit a bank," said Deaven, the Homeland Security agent. "It's just a very lucrative crime."
In Houston's Harris County last year, thieves robbed at least a dozen cell phone stores -- sometimes at gunpoint -- during a two-month period, prompting the police department to establish a special task force to investigate the burglaries.
At one store in Houston, three men crashed a truck through the front window and stole dozens of cell phones before speeding away. At another store last year, a thieflowered himself through the ceiling, grabbed as many handsets as he could, then climbed back through the ceiling to escape.
Last July, Anthony Riopelle, 22, was working at a Meijer department store in Taylor, Mich., when two men approached and started asking about iPads. Suddenly, one man punched Riopelle in the face, knocking him to the ground, while the other grabbed more than a dozen tablets and fled the store, according to police.
"They said, ‘If you move, we're going to kill you,'" Riopelle told HuffPost.
Police said they later found the stolen iPads behind the bulletproof glass window at Ace Wholesale. The two thieves were never caught.
It was not the only time police tracked stolen mobile devices to Ace Wholesale. In August, Taylor police arrested a man in the company's parking lot shortly after he had stolen iPhones from several victims at gunpoint in Detroit.
"Ace Wholesale made it very easy for people who were obtaining phones through robberies and retail fraud to go there and sell them," Taylor police Chief Mary Sclabassi told HuffPost. "It brought a large crime element to the city."
Dozens of other companies around the country have played a similar role, Sprint says.
Sprint's investigators discovered hundreds of stolen iPhones stored in a suburban Baltimore warehouse owned by a company called Wireless Buybacks, according to alawsuit Sprint filed against the company in February. Wireless Buybacks says it buys used phones and resells them to large retailers, which in turn issue them to customers who have insurance policies and need a replacement phone.
In its lawsuit, Sprint claims that a company associated with Wireless Buybacks tried to sell 800 iPhones to its undercover investigator for more than $400,000. A sample of serial numbers revealed that "the vast majority" of phones were stolen or obtained through fraud, the suit says.
In February, agents from the FBI, the Secret Service and the Bureau of Alcohol, Tobacco and Firearms raided Wireless Buybacks' warehouse in Elkridge, Md., and found the facility was being used to store stolen phones, according to Sprint. Law enforcement declined to comment about the raid, citing an ongoing investigation.
In court documents, Wireless Buybacks said it "does not knowingly transact business with anyone involved in burglaries or armed robberies" and conducts "a rigorous screening process" to ensure it doesn't buy stolen phones.
Kevin Lowe, co-founder of Wireless Buybacks, has said that his company supplies phones to "some of the largest retailers in the country." The company generates most of its revenue from a contract to supply cell phones to Best Buy worth about $45 million each year, the company said in court documents.
Best Buy has no plans to cut ties with Wireless Buybacks. "At this point, these are accusations that haven't been substantiated," a company spokesman said.
But Baldinger, Sprint's attorney, said the lawsuit reveals how many U.S. consumers are unwittingly buying stolen phones.
"There are lots of consumers walking around with phones they think they got legitimately from a national retailer," he said, "when in fact the phones were stolen during armed robberies."
‘TONY BUY iPHONE'
The middlemen at the center of the global trade in stolen smartphones organize themselves into distinct roles.
Many hire hackers who use special software to "unlock" the devices, enabling them to connect with wireless networks around the world, according to Lt. Ed Santos of the San Francisco Police Department, which has created a special task force focused on combating smartphone thefts. Then, they erase the data on the handsets, often within an hour after the device is stolen.
"They completely erase them so the phones can't be identified by who they belong to," Santos told HuffPost. "They want to sell a clean phone that can't be traced."
Traffickers later repackage phones in boxes with the manufacturer's logo, power chargers and instruction manuals in the native language of their destinations, according to Sprint.
Finally, they ship them overseas, mostly to Hong Kong, where they are distributed across Southeast Asia, said Baldinger, Sprint's attorney. Many phones are also shipped to Dubai, Israel and Latin America.
In 2011, Ace Wholesale shipped dozens of iPhones and Samsung Nexus phones to Go Telecom HK and Mobile Planet HK, according to invoices obtained by Sprint. These two companies listed addresses in Kowloon, a district of Hong Kong that is thick with electronics merchants.
Most traffickers ship phones in large cardboard boxes via FedEx and UPS, according to Deaven, the Homeland Security agent. The destination of stolen phones often depends on the provenance of the traffickers.
"Here in San Francisco, a lot of people have ties to Mexico," San Francisco police Sgt. Josh Kumli said. "A lot of phones are going to Mexico because that is where they have contacts."
Until December of last year, two brothers, Henry and Victor Gamboa, drove thousands of stolen phones and other electronics by truck from the Bay Area to Mexico every two weeks, Santos said. The two brothers are now in jail after being convicted of running a massive stolen electronics fencing ring.
Thuc Ngo told Sprint's lawyers that he smuggled iPhones from California to his native Vietnam, where his siblings helped him find buyers, according to a deposition from a Sprint lawsuit against him.
Ngo said he obtained phones through his business, which he called "Tony Buy iPhone." He drove a white Dodge Ram 3500 van emblazoned with an advertisement -- "We Buy Used Iphone" -- listing his phone number and website, the lawsuit claims. He met customers at Starbucks coffee shops around the Bay Area and paid between $220 and $330 for each iPhone. Some of the iPhones had been reported stolen, he confessed, according to his deposition.
He regularly flew to Vietnam to sell his inventory, stuffing the phones in his pockets and strapping them to his waist beneath his clothing with plastic wrap -- a technique he used to bypass Vietnamese customs at the airport and avoid paying taxes, the deposition says. In this way, he carried 11 iPhones at a time.
"That's the most I can hide on my body," he said, the deposition notes.
And yet it was never enough.
"Every time I was there, people would tell me, ‘Oh, next time, I want such and such phone and if you come back, you know, sell it to me,'" he said.
Earlier this year, a judge in San Francisco barred Ngo from buying and selling phones manufactured for use on Sprint's network. Ngo could not be reached for comment.
Thuc Ngo drove this van to meet people and buy iPhones that he smuggled to Vietnam, according to Sprint.
A 'SECRETIVE' STOREFRONT
Ace Wholesale acquired phones by advertising on Craigslist and websites like thewirelessbuzz.com and wirelessdealers.com. One ad read: "Buying Apple iPhone 4S!! Must Be Brand New!!..Will Buy any Quantity!!" Another read: "Ace Will Buy Your Smartphone For Top Dollar!!!!!!!"
The company listed the price it paid for each model on the walls of its stores. The latest iPhones still sealed in their original packaging commanded the highest prices. One employee told Sprint's undercover investigator that he was buying the iPhone 4S for $430.
At the Ace storefront in Taylor, Mich., the Mattress World employee next door said he saw "the same people every day" arriving with bags full of iPhones and other high-end phones and tablets. Mirrored windows prevented passersby from seeing inside. The company hired a security guard to sit in a car in the parking lot. Sometimes, people bought phones from others in the parking lot, then resold them inside Ace.
At another Ace Wholesale location in Troy, Mich., the company replaced the glass front door with a metal door featuring a peephole and buzzer, according to Scott Zochowski, an attorney who works in the building.
"They were very secretive and kept very strange hours," Zochowski told HuffPost. "I've always been very suspicious about what the heck was going on in there."
With so much valuable inventory moving through its operation, Ace Wholesale itself became a target for robberies, police say. In February 2011, Floarea, the store's owner, told police that four masked men broke into his store and stole 258 cell phones worth about $140,000. One month later, police say six men wearing masks broke into Ace Wholesale again and stole smartphones and tablets worth $173,000.
Last July, a man reported to police that he was robbed at gunpoint in the parking lot of Ace Wholesale after he sold 25 iPads for $15,000. The gunman grabbed the cash, which was in a black duffel bag, and ran away, according to a police report.
Some Ace Wholesale associates have criminal records. At the Atlanta location, the company paid $800 to Barney Gunn for two iPhones, Sprint says. Gunn, 46, who goes by the streetname "Spook," has served multiple prison sentences since the early 1990s for drug and weapons charges, Georgia court records show.
One morning last August, a SWAT team and agents from the Department of Homeland Security busted through the front window at Ace Wholesale's location in Taylor, leaving behind piles of shattered glass. The storefront is now occupied by a company that sells outdoor pools and jacuzzis. Federal agents spent six hours removing boxes and surveillance cameras from inside Ace Wholesale's location in Troy, Zochowski said.
In court documents, Ace Wholesale said the raids forced the company to shut down its business. Its website says its inventory is now "entirely online" and being carried by its sister company, Electronics Direct, which is also owned by Floarea.
Baldinger, of Sprint, said the raid against Ace Wholesale caused "a short-lived drop" in the number of phones being shipped overseas.
But in the increasingly competitive underground smartphone trade, shutting down one operation -- even a major one -- left plenty of others waiting in the wings, Baldinger added.
"There are so many other players out there," he said. "The raid provided an opportunity for a lot of other traffickers to step up and fill the void."
Subscribe to:
Posts (Atom)