Five Defendants Indicted in Scheme to “Straw Purchase” Firearms in Michigan and Re-Sell Them in Chicago

CHICAGO — Five defendants have been indicted on federal firearms violations for conspiring to “straw purchase” handguns in Michigan and re-sell them in Chicago.

Michigan residents CORNELIUS BATTLE and DALRICK DRAIN purchased firearms from federally licensed dealers in Kalamazoo, Mich., and falsely certified on required forms that they were the actual buyers of the guns, the indictment states. Battle and Drain purchased the guns on behalf of NATHANIEL McELROY, a Chicago resident who identified which firearms he wanted and had paid Battle and Drain a premium over the stores’ prices, according to the indictment. In the first six months of 2017, the trio and two other defendants, REGINALD JOHNSON and LASHON MOORE, caused at least nine handguns to be purchased in Michigan and transported to Chicago, the indictment states.

The two-count indictment was returned Aug. 31, 2017, in federal court in Chicago, and ordered unsealed on Sept. 7, 2017. It charges the defendants with one count of conspiracy to willfully deal firearms without a license, to willfully transfer firearms to non-Michigan residents, and to knowingly make false statements in connection with the acquisition of a firearm; and one count of willfully dealing firearms without a license.

“The United States Attorney’s Office is committed to aggressively using federal firearm laws to keep illegal guns off the streets,” said Joel R. Levin, Acting United States Attorney for the Northern District of Illinois. “We will use whatever federal tools are appropriate to prosecute straw purchasers and hold them accountable for bringing illegal firearms into Chicago.”

Acting U.S. Attorney Levin announced the charges along with Michael J. Anderson, Special Agent-in-Charge of the Chicago office of the Federal Bureau of Investigation. The Chicago Police Department provided valuable participation in the investigation.

McElroy, 21, was arrested on Aug. 31, 2017. During a detention hearing in federal court in Chicago last week, U.S. Magistrate Judge Susan E. Cox ordered McElroy detained in federal custody pending trial. McElroy’s next court date has not yet been set.

Battle, 23, of Kalamazoo, Mich., was arrested in Michigan on Sept. 1, 2017. During a detention hearing in federal court in Kalamazoo last week, U.S. Magistrate Judge Phillip J. Green ordered Battle released on home confinement. Judge Green ordered Battle to appear in Chicago on a future date to be determined by the Court.

Moore, 28, of Kalamazoo, Mich., is currently in custody in Michigan on an unrelated state charge. The U.S. Attorney’s Office will seek his removal to Chicago at a future date.

Arrest warrants have been issued for Drain, 27, and Johnson, 24, both of Kalamazoo, Mich. They were not custody as of today.

The indictment describes two purchases made at the Kalamazoo firearm businesses. On Feb. 28, 2017, Drain bought two guns at On Target; and on March 30, 2017, Drain bought two guns from Dunham Sports, the indictment states. Other defendants and an unindicted member of the scheme later conspired to transfer the guns to Chicago, the indictment states. The charges allege that the defendants’ straw purchasing scheme violated a federal law that requires individuals purchasing certain firearms from an out-of-state dealer to first have the firearms transferred to a dealer in the buyer’s state of residency before the individual can legally take possession.

The public is reminded that an indictment is not evidence of guilt. The defendants are presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

Each count of the indictment is punishable by a maximum sentence of five years in prison. If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.

The government is represented by Assistant U.S. Attorneys Albert Berry III and Ankur Srivastava.