District Not Recorded
The source did not name an office we could identify. These records remain unassigned rather than guessed.
Justice Department Seeks to Shut Down Georgia Tax Return PreparerRead the Press Release
The United States filed a complaint in the U.S. District Court for the Middle District of Georgia seeking to bar a Tifton, Georgia, tax return preparer from preparing tax returns for others.
The civil suit against Alicia Coarsey, aka Meredith Coarsey, and Tax Xpress of Tifton LLC, alleges that Coarsey owns Tax Xpress and prepares federal individual income tax returns claiming fabricated medical expenses and charitable contributions. In addition, according to the complaint, Coarsey fabricates claimed business losses, in some cases for non-existent businesses, in order to claim improper earned income tax credits. As one example, the complaint alleges that she claimed over $19,000 in medical deductions for tax year 2019 for one customer, who has since stated that he did not have significant medical expenses in that year. The complaint further alleges that returns prepared by Coarsey use these bogus claims to falsely understate her customers’ tax liabilities and inflate their refund claims. According to the complaint, the United States has likely lost millions of dollars in tax revenue as a result of her activities.
Acting Assistant Attorney General David A. Hubbert of the Justice Department’s Tax Division made the announcement.
Return preparer fraud is one of the IRS’ Dirty Dozen Tax Scams and taxpayers seeking a return preparer should remain vigilant. (More information can also be found here.) The IRS has information on its website for choosing a tax preparer, has launched a free directory of federal tax preparers, and offers information on how to avoid “ghost” tax preparers, whose refusal to sign a return should be a red flag to taxpayers. The IRS also has a list of important reminders for taxpayers who are about to file their 2020 tax returns, including how to prepare for a smooth filing process.
In addition, IRS Free File, a public-private partnership, offers free online tax preparation and filing options on IRS partner websites for individuals whose adjusted gross income is under $72,000. For individuals whose income is over that threshold, IRS Free File offers electronical federal tax forms that can be filled out and filed online for free.
In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.
Justice Department Requires Republic Services to Divest Assets to Proceed with Santek AcquisitionRead the Press Release
The Department of Justice announced today that Republic Services Inc. (Republic) will be required to divest waste collection and disposal assets in five states in order to proceed with its acquisition of Santek Waste Services LLC (Santek). The department said that without the divestiture, the proposed acquisition would substantially lessen competition for small container commercial waste collection and municipal solid waste disposal services in six local markets across the southeastern United States.
The department’s Antitrust Division — along with the Alabama Attorney General — filed a civil antitrust lawsuit today in the U.S. District Court for the District of Columbia to block the proposed transaction. At the same time, the department filed a proposed settlement that, if approved by the court, would resolve the competitive harm alleged in the department’s complaint.
“The waste collection and disposal services provided by Republic and Santek are essential services for businesses, municipalities, and towns,” said Acting Assistant Attorney General Richard A. Powers of the Justice Department’s Antitrust Division. “Today’s settlement, which requires Republic and Santek to divest numerous facilities and assets in five states, will ensure that these customers continue to benefit from competition for these critical services.”
According to the complaint, Republic and Santek both provide small container commercial waste collection and municipal solid waste disposal services. In each of the local markets alleged in the complaint, Republic and Santek compete vigorously against each other and are two of only a few significant providers of one or both of these essential services. The combination of the two companies would eliminate head-to-head competition between them and threaten the lower prices and better service that customers have realized from that competition.
The complaint further alleges that, in the Chattanooga, Tennessee, and northern Georgia area, the proposed acquisition would limit the ability of collection rivals to compete with the merged company’s collection operations. The combination of these two vertically-integrated companies that are both strong in collection and disposal in this market would give the merged company an increased incentive and ability to weaken its collection competitors by raising the price of disposal, a key input for collection services. With limited alternative disposal options left in the market, collection rivals would have to incur higher disposal costs or cease their operations, thereby reducing competition in the collection market.
Under the terms of the proposed settlement, Republic and Santek must divest landfills, transfer stations, hauling locations, and waste collection routes in Alabama, Georgia, Tennessee, and Mississippi to Kinderhook Industries LLC (Kinderhook), or to an alternate acquirer approved by the United States. Kinderhook, based in New York, New York, is a private investment firm whose portfolio companies include Capital Waste Services LLC and EcoSouth Services of Mobile LLC, two providers of waste management services in the United States.
The proposed settlement also requires that Republic and Santek divest waste collection routes and associated assets in Texas to Waste Connections Inc. (WCN), or to an alternate acquirer approved by the United States. WCN, based in Ontario, Canada, is a provider of small container commercial waste collection and municipal solid waste disposal services in local markets in Canada and the United States.
Republic, a Delaware corporation headquartered in Phoenix, Arizona, generated total revenues of approximately $10.2 billion in 2020.
Santek, a Tennessee limited liability company headquartered in Cleveland, Tennessee, generated total revenues of approximately $140 million in 2019, the last year for which information is publicly available.
As required by the Tunney Act, the proposed consent decree, along with a competitive impact statement, will be published in the Federal Register. Any person may submit written comments concerning the proposed settlement during a 60-day comment period to Katrina Rouse, Chief, Defense, Industrials, and Aerospace Section, Antitrust Division, U.S. Department of Justice, 450 Fifth Street NW, Suite 8700, Washington, D.C. 20530. At the conclusion of the 60-day comment period, the U.S. District Court for the District of Columbia may enter the final judgment upon a finding that it serves the public interest.
Brother and Sister Charged in Scheme to Thwart IRS Tax CollectionRead the Press Release
A federal grand jury in Houston, Texas, returned an indictment on March 17, 2021, charging Michael Andrew McCann with conspiring to defraud the United States, endeavoring to obstruct the IRS, failing to file tax returns, and making false bankruptcy declarations.
The grand jury also returned an indictment charging Toni Gale Engeling with conspiring to defraud the United States and obstructing the grand jury. The defendants made their initial court appearance today before U.S. Magistrate Judge Sam Sheldon of the U.S. District Court for the Southern District of Texas.
According to the indictment, McCann is a dentist in Brazoria and Engeling is a bookkeeper and McCann’s sister. From 2010 to 2015, McCann and Engeling allegedly employed a variety of methods to prevent the IRS from assessing and collecting McCann’s individual income taxes, including using nominee entities, commingling personal and business finances, and lying to the IRS. The indictment further alleges that McCann corruptly endeavored to obstruct IRS collection efforts as early as 2002; that McCann made false declarations on schedules he filed in connection with multiple bankruptcy cases; and that McCann willfully failed to file tax returns for the years 2014 through 2018. The indictment further alleges that in September 2019, Engeling obstructed the grand jury’s investigation into McCann by making false and misleading statements.
If convicted, McCann faces a maximum sentence of five years in prison for the conspiracy charge; five years in prison for each charge of bankruptcy fraud; three years in prison for the IRS obstruction charge; and one year for each charge of willful failure to file. If convicted, Engeling faces a maximum sentence of five years in prison for the conspiracy charge and ten years in prison for the grand jury obstruction charge.
Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division made the announcement.
IRS-Criminal Investigation is investigating the case.
Senior Litigation Counsel Jen Ihlo and Trial Attorneys Mitchell Galloway and William Guappone of the Tax Division are prosecuting the case.
An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Michigan Man Pleads Guilty to Federal Hate Crime for Attacking Black TeenagerRead the Press Release
A Michigan man pleaded guilty today to a federal hate crime for attacking a Black teenager.
Lee Mouat, 43, of Newport, willfully caused bodily injury to a Black teenager because of the teenager’s race.
According to the plea agreement, Mouat confronted a group of Black teenagers, including the victim, at a state park in Monroe. Mouat repeatedly used racial slurs and said that Black people had no right to use the public beach where the incident occurred. Mouat then struck one of the teens in the face with a bike lock, knocking out several of the victim’s teeth, lacerating his face and mouth, and fracturing his jaw. Mouat also attempted to strike another Black teenager with the bike lock.
“Hate-fueled incidents like this one have no place in a civilized society,” said Principal Deputy Assistant Attorney General Pamela Karlan for the Civil Rights Division. “The Justice Department is committed to using all the tools in our law enforcement arsenal to prosecute violent acts motivated by hate.”
“Our office is committed to protecting the rights of all citizens, and prosecuting hate crimes is a top priority,” said Acting U.S. Attorney Saima Mohsin for the Eastern District of Michigan. “The young victim in this case suffered tremendously from this vicious, racially motivated assault. Every individual citizen has the right to not live in fear of violence or attack based on the color of their skin.”
“Mouat’s hateful and violent conduct, motivated by racial intolerance, was intended to physically harm the victim as well as create fear within the African-American community,” said Special Agent in Charge Timothy Waters of the FBI’s Detroit Division. “The FBI and our law enforcement partners will continue to ensure that if a crime is motivated by bias, it will be investigated as a hate crime and the perpetrators will be held responsible for their actions. We encourage anyone who has been the victim of or witness to such a crime to report it to the FBI.”
Mouat will be sentenced at a hearing scheduled for June 24, 2021. He faces a maximum penalty of 10 years in prison, three years of supervised release, and a fine of up to $250,000.
This case was investigated by the FBI and is being prosecuted by Assistant U.S. Attorney Frances Carlson of the Eastern District of Michigan and Trial Attorney Tara Allison of the Civil Rights Division.
Justice Department Settles Housing Discrimination Lawsuit Against Staten Island, New York Rental Agent and Real Estate AgencyRead the Press Release
The Justice Department announced today that its Civil Rights Division, together with the U.S. Attorney’s Office for the Eastern District of New York, has reached a settlement with Village Realty of Staten Island Ltd. and Denis Donovan, a sales and former rental agent at Village Realty, to resolve a lawsuit filed last year alleging discrimination against African Americans in violation of the Fair Housing Act.
Today’s agreement, which is in the form of a consent decree, must still be approved by the U.S. District Court for the Eastern District of New York. The settlement resolves claims that Donovan discriminated against prospective renters on the basis of race by treating African Americans who inquired about available rental units differently and less favorably than similarly-situated white persons and that Village Realty is legally responsible for Donovan’s alleged discrimination because he was acting as Village Realty’s agent. The lawsuit was based on the results of testing conducted by the department’s Fair Housing Testing Program, in which individuals pose as renters to gather information about possible discriminatory practices. The department’s complaint alleges that Donovan told African-American testers about fewer rental units than white testers, offered white testers rental discounts and opportunities to inspect units that were not offered to African-American testers, generally offered African-American testers units only in racially mixed neighborhoods while offering white testers units in both overwhelmingly white and racially mixed neighborhoods, and made more encouraging comments to white testers about available rental units.
“For 30 years – since its establishment in 1991 – the Fair Housing Testing Program has played a critical role in helping the Justice Department root out discrimination that might otherwise go undetected,” said Principal Deputy Assistant Attorney General Pamela S. Karlan of the Civil Rights Division. “Today’s settlement reflects the department’s continued commitment to uncover and eliminate discrimination in all forms and to ensure equal access to housing regardless of race.”
“Today’s settlement underscores the importance of making housing equally available to all residents of this district, regardless of race,” said Acting U.S. Attorney Mark J. Lesko of the Eastern District of New York. “This office is committed to ending racial discrimination and to achieving fairness and equality in housing.”
Under the consent decree, the defendants will establish a settlement fund of $15,000 to compensate victims of Donovan’s alleged discriminatory practices and pay a civil penalty of $2,500 to the United States. The agreement prohibits the defendants from engaging in further acts of discrimination and requires them to implement nondiscriminatory standards and procedures, undergo fair housing training, and provide periodic reports to the department.
Individuals who believe they may have experienced discrimination at Village Realty should contact the Justice Department toll-free at 1-800-896-7743 or by email at [email protected]. Individuals may be entitled to relief from the settlement fund if they (1) are African-American; (2) visited or called Village Realty to inquire about units available for rent prior to March 31, 2019; and (3) were denied the opportunity to rent a unit or provided untrue or incomplete information about available rental units.
The Justice Department’s Civil Rights Division enforces the federal Fair Housing Act, which prohibits discrimination in housing on the basis of race, color, religion, sex, familial status, national origin and disability. More information about the department’s fair housing enforcement can be found at www.justice.gov/fairhousing.
Health Care Staffing Company and Executive Indicted for Colluding to Suppress Wages of School NursesRead the Press Release
A federal grand jury in Las Vegas, Nevada, returned an indictment today charging VDA OC LLC (formerly Advantage On Call LLC), a health care staffing company, and Ryan Hee, a former manager of the company, with entering into and engaging in a conspiracy with a competitor to allocate employee nurses and to fix the wages of those nurses, in violation of the Sherman Act.
According to the one-count felony indictment filed today in the U.S. District Court for the District of Nevada, Hee, a resident of Las Vegas, along with a co-conspirator, agreed not to recruit or hire nurses staffed by their respective companies at Clark County School District facilities and to refrain from raising the wages of those nurses. During the alleged conspiracy, from about October 2016 until July 2017, Advantage was one of two primary providers of contract nursing services to the school district and employed Hee as a regional manager in its Las Vegas office. Advantage changed its name to VDA OC LLC after its assets were acquired by another company in July 2017.
“When employers conspire to allocate employees and fix wages, it robs American workers of higher pay and the ability to bargain for better, higher-paying jobs,” said Acting Assistant Attorney General Richard A. Powers of the Department of Justice’s Antitrust Division. “Ensuring that American workers receive the benefits of free and fair competition is a top priority, so we will use every investigative tool at our disposal to investigate these crimes and prosecute perpetrators to the full extent of the law.”
“Our office is committed to investigating and prosecuting employers that harm the livelihood of American workers by conspiring to suppress wages,” said Acting U.S. Attorney Christopher Chiou for the District of Nevada. “Working closely with the Antitrust Division, we will continue protecting the integrity of Nevada’s labor market against illegal wage-fixing and no-poach agreements.”
“The FBI is committed to investigating potential corruption that impedes our economy,” said Assistant Director Calvin Shivers of the FBI Criminal Investigative Division. “The FBI works daily to disrupt illegal activity, like wage-fixing in this case, protecting honest American workers from those who would unfairly enrich themselves. We work hand-in-hand with our partners at the Department of Justice to stop this type of alleged activity and ensure Justice is served.”
A violation of the Sherman Act carries a statutory maximum penalty of 10 years in prison and a $1 million fine for individuals and a maximum penalty of a $100 million fine for corporations. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by victims if either amount is greater than the statutory maximum.
Today’s announcement is the result of a federal investigation being conducted by the Antitrust Division’s San Francisco Office and the International Corruption Unit of the FBI, with assistance from the U.S. Attorney’s Office for the District of Nevada.
The charges in this case were brought in connection with the Antitrust Division’s ongoing commitment to prosecute anticompetitive conduct affecting American labor markets. Anyone with information on market allocation or price fixing by employers should contact the Antitrust Division’s Citizen Complaint Center at 1-888-647-3258 or visit www.justice.gov/atr/contact/newcase.html.
An indictment merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt.
Navajo woman pleads guilty to abandonment and abuse of a child resulting in deathRead the Press Release
ALBUQUERQUE, N.M. – Tonya Mae Dale, 28, of the Navajo Nation, NM, pleaded guilty in federal court on March 24 to a charge of involuntary manslaughter in Indian Country.
A grand jury previously returned an indictment against Dale on Sept. 25, 2019. According to the indictment and other court records, Dale committed the offense in San Juan County on or about June 26, 2019. In her plea, Dale admitted to driving while intoxicated with her children in the vehicle, and her intoxication contributed to her vehicle becoming stuck. The next day Dale decided to leave her vehicle and began walking. At some point, she decided to leave her children, a baby and a young child, and seek help on her own. When she returned with assistance to the location she had left her kids, only the baby was still there. The other child had wandered away and was found deceased the next day.
Dale is currently in custody pending sentencing. She faces up to eight years in prison.
The FBI investigated this case with assistance from the Navajo Nation Police Department. Assistant U.S. Attorney Nicholas Marshall is prosecuting the case.
Justice Department Settles Sexual Harassment and Retaliation Lawsuit Against Orlando, Florida Fire DepartmentRead the Press Release
The Justice Department announced today that it has reached a settlement, through a consent decree, with the City of Orlando resolving allegations that the city violated Title VII of the Civil Rights Act of 1964 when it discriminated and retaliated against Dawn Sumter, a female Assistant Fire Chief with the Orlando Fire Department (“Fire Department”).
Title VII is a federal law that prohibits discrimination in employment on the basis of race, color, religion, sex, and national origin and retaliation for engaging in activities protected by Title VII, such as complaining about discrimination. The complaint and consent decree, filed in a federal district court in Orlando, resolve allegations that Assistant Chief Sumter was sexually harassed by the former fire chief and then retaliated against by Fire Department leadership for complaining about the discrimination and harassment that she faced.
“Sexual harassment in the workplace is intolerable under any circumstance and is particularly pernicious where the victim is a public servant engaged in protecting fellow members of the community,” said Principal Deputy Assistant Attorney General Pamela S. Karlan of the Justice Department’s Civil Rights Division. “The type of sexual harassment and retaliation allegedly suffered by the assistant fire chief in this case prevents women who work in jobs historically dominated by men from protecting and serving the public on an equal basis. This consent decree reflects the Civil Rights Division’s commitment to ensuring that all workers are entitled to a workplace free from sexual harassment and that no person should fear retaliation for seeking help when harassed.”
“Protecting the civil rights of our citizens, including public sector employees, remains a paramount priority for the Middle District of Florida,” said Acting U.S. Attorney Karin Hoppmann for the Middle District of Florida. “Sexual harassment and retaliation in the workplace will not be tolerated and the type of discrimination suffered by Assistant Chief Sumter can only be prevented when employers unequivocally promote a workplace free from discrimination.”
The United States’ complaint, filed today in the U.S. District Court for the Middle District of Florida, alleges that Assistant Chief Sumter’s immediate supervisor, the former fire chief, regularly subjected her to sexual harassment in the workplace. After Ms. Sumter filed a charge with the Equal Employment Opportunity Commission (EEOC) complaining about discrimination, the Fire Department began to retaliate against her, according to the complaint filed today. Fire Department leadership, including the former chief and deputy chiefs, took several harassing, retaliatory actions designed to derail Ms. Sumter’s career and prohibit her from advancement within the Fire Department because of her discrimination complaint.
Under the terms of the consent decree, the City of Orlando will develop and submit to the United States for approval its discrimination and retaliation policies, complaint investigation procedures, and trainings that will be used at the Fire Department. The consent decree further requires the city to provide training for all Fire Department employees on these policies and provides for future annual training on these subjects. The city will also pay Ms. Sumter $251,500 in compensatory damages and $182,640 in attorney’s fees to her private counsel.
The EEOC received a charge of sex discrimination and an amended charge of retaliation filed by Ms. Sumter. The EEOC investigated the matter and found reasonable cause to believe that the Fire Department discriminated against and retaliated against its employee. After unsuccessful conciliation efforts, the EEOC referred the matter to the Justice Department.
Today’s agreement is part of the Civil Rights Division’s Sexual Harassment in the Workplace Initiative announced in February 2018. The Initiative is aimed at eradicating sexual harassment in state and local government workplaces. It focuses on litigation, outreach, and development of effective remedial measures to address and prevent future sex discrimination and harassment.
The Civil Rights Division’s Employment Litigation Section brought this case in collaboration with the U.S. Attorney’s Office for the Middle District of Florida. The case was brought by Employment Litigation Section Attorneys Brian McEntire and Ejaz Baluch Jr. and Assistant U.S. Attorney Yohance Pettis of the Middle District of Florida.
The full and fair enforcement of Title VII is a top priority of the Justice Department’s Employment Litigation Section of the Civil Rights Division. Additional information about the Civil Rights Division and the jurisdiction of the Employment Litigation Section is available on its websites at www.justice.gov/crt/ and https://www.justice.gov/crt/employment-litigation-section.
Justice Department Files Civil Action to Shut Down Two Miami-Area Tax Return PreparersRead the Press Release
The United States has filed a complaint in the U.S. District Court for the Southern District of Florida, Miami Division, seeking to bar two Miami-area tax return preparers from preparing federal income tax returns for others.
The civil complaint was filed against Gerald Vito, James Eleby, and Gerald Vito LLC dba Income Tax Services and alleges that defendants prepared federal income tax returns for numerous Miami-area taxpayers that significantly understated their customers’ tax liabilities. The complaint further alleges that in reporting their customers’ itemized deductions, defendants fabricated or inflated charitable deductions, medical expenses, and employee business expenses. According to the complaint, claiming false or inflated deductions allows a fraudulent tax preparer to underreport the customer’s taxable income and reduce their reported tax liability, which in many cases leads to bogus and fraudulent refund claims. The complaint also alleges that defendants significantly understated their customers’ tax liabilities by reporting false or inflated business losses.
According to the complaint, defendants prepared more than 1,900 tax returns during the 2018 and 2019 calendar years, and each such return, on average, understates the tax the customer owes by thousands of dollars. As a result, the complaint alleges, defendants have likely cost the United States millions of dollars in lost tax revenue. The complaint further alleges that defendants have harmed their customers, who could potentially be required to pay tax deficiencies, interests, and penalties as a result of defendants’ conduct.
Acting Assistant Attorney General David A. Hubbert of the Justice Department’s Tax Division made the announcement.
Return preparer fraud is one of the IRS’ Dirty Dozen Tax Scams and taxpayers seeking a return preparer should remain vigilant. (More information can also be found here.) The IRS has information on its website for choosing a tax preparer, has launched a free directory of federal tax preparers, and offers information on how to avoid “ghost” tax preparers, whose refusal to sign a return should be a red flag to taxpayers. The IRS also has a list of important reminders for taxpayers who are about to file their 2020 tax returns, including how to prepare for a smooth filing process.
In addition, IRS Free File, a public-private partnership, offers free online tax preparation and filing options on IRS partner websites for individuals whose adjusted gross income is under $72,000. For individuals whose income is over that threshold, IRS Free File offers electronical federal tax forms that can be filled out and filed online for free.
In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.
Louisiana Construction Company Owner and Two Employees Indicted for Tax FraudRead the Press Release
A federal grand jury in New Orleans, Louisiana, returned an indictment today charging three Louisiana residents with conspiracy to defraud the IRS. One defendant, Matthew Reck, was additionally charged with making a false statement to federal agents, and the other defendants, Dawn Farrell Ruiz and David Farrell, were charged with aiding in the preparation of false returns.
According to the indictment, from 2011 to at least June 2019, Matthew Reck and Dawn Farrell Ruiz, both of St. Tammany Parish, and David Farrell, of Jefferson Parish, allegedly conspired to defraud the IRS by underreporting their individual compensation and causing to be filed false individual tax returns. Further, Reck and Ruiz allegedly caused to be filed false corporate tax returns, relating to SES Construction Consulting Group (SES) and Global Technical Solutions (Global). Reck co-owned the two construction businesses through at least December 2015, and Farrell worked as a project manager and Ruiz as a bookkeeper for both businesses. The indictment further alleges that Reck, Farrell, and Ruiz paid some workers “off the books” in cash and did not report the workers’ full compensation to the IRS. When federal agents from IRS-Criminal Investigation subsequently interviewed Reck, he allegedly falsely stated that he had no communications with the accountant for SES and Global regarding the preparation of the companies’ corporate tax returns.
The defendants are scheduled for their initial court appearance on April 9, 2021, in the U.S. District Court for the Eastern District of Louisiana. If convicted, they face a maximum penalty of five years in prison on the conspiracy charge. Reck also faces a maximum of five years in prison on the charge of making false statements to federal agents, and Farrell and Ruiz face a maximum of three years in prison on each of the charges of aiding in the preparation of a false tax return. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and the U.S. Attorney’s Office for the Eastern District of Louisiana made the announcement.
IRS-Criminal Investigation is investigating the case.
Trial Attorneys William Montague and Parker Tobin of the Justice Department’s Tax Division and Assistant U.S. Attorney Nicholas Moses of the Eastern District of Louisiana are prosecuting the case.
An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Justice Department Takes Action Against COVID-19 FraudRead the Press Release
The Department of Justice announced an update today on criminal and civil enforcement efforts to combat COVID-19 related fraud, including schemes targeting the Paycheck Protection Program (PPP), Economic Injury Disaster Loan (EIDL) program and Unemployment Insurance (UI) programs.
As of today, the Department of Justice has publicly charged 474 defendants with criminal offenses based on fraud schemes connected to the COVID-19 pandemic. These cases involve attempts to obtain over $569 million from the U.S. government and unsuspecting individuals through fraud and have been brought in 56 federal districts around the country. These cases reflect a degree of reach, coordination, and expertise that is critical for enforcement efforts against COVID-19 related fraud to have a meaningful impact and is also emblematic of the Justice Department’s response to criminal wrongdoing.
“The Department of Justice has led an historic enforcement initiative to detect and disrupt COVID-19 related fraud schemes,” said Attorney General Merrick B. Garland. “The impact of the department’s work to date sends a clear and unmistakable message to those who would exploit a national emergency to steal taxpayer-funded resources from vulnerable individuals and small businesses. We are committed to protecting the American people and the integrity of the critical lifelines provided for them by Congress, and we will continue to respond to this challenge.”
“To anyone thinking of using the global pandemic as an opportunity to scam and steal from hardworking Americans, my advice is simple – don’t,” said Acting Assistant Attorney General Nicholas L. McQuaid of the Justice Department’s Criminal Division. “No matter where you are or who you are, we will find you and prosecute you to the fullest extent of the law.”
“We will not allow American citizens or the critical benefits programs that have been created to assist them to be preyed upon by those seeking to take advantage of this national emergency,” said Acting Assistant Attorney General Brian M. Boynton of the Justice Department’s Civil Division. “We are proud to work with our law enforcement partners to hold wrongdoers accountable and to safeguard taxpayer funds.”
In March 2020, Congress passed a $2.2 trillion economic relief bill known as the Coronavirus Aid, Relief, and Economic Security (CARES) Act designed to provide emergency financial assistance to the millions of Americans who are suffering the economic effects caused by the COVID-19 pandemic. Anticipating the need to protect the integrity of these taxpayer funds and to otherwise protect Americans from fraud related to the COVID-19 pandemic, the Department of Justice immediately stood up multiple efforts dedicated to identifying, investigating, and prosecuting such fraud. Leveraging data analysis capabilities and partnerships developed through its vast experience combatting economic crime and fraud on government programs, the Justice Department’s response to COVID-19 related fraud serves as a model for proactive, high-impact white-collar enforcement, and demonstrates our agility in responding to new and emerging threats. This rapid and nationwide response enabled the Justice Department to quickly ensure accountability for wrongdoing amid a national crisis and sent a forceful message of deterrence during an ongoing crisis. The multifaceted and multi-district approach to enforcement during this national health emergency continues and is expected to yield numerous additional criminal and civil enforcement actions in the coming months.
On criminal matters, the Justice Department’s efforts to combat COVID-19 related fraud schemes have proceeded on numerous fronts, including:
- Paycheck Protection Program (PPP) fraud: Prominent among the department’s efforts have been cases brought by the Criminal Division’s Fraud Section involving at least 120 defendants charged with PPP fraud. The cases involve a range of conduct, from individual business owners who have inflated their payroll expenses to obtain larger loans than they otherwise would have qualified for, to serial fraudsters who revived dormant corporations and purchased shell companies with no actual operations to apply for multiple loans falsely stating they had significant payroll, to organized criminal networks submitting identical loan applications and supporting documents under the names of different companies. Most charged defendants have misappropriated loan proceeds for prohibited purposes, such as the purchase of houses, cars, jewelry, and other luxury items. In one case, U.S. v. Dinesh Sah, in the Northern District of Texas, the defendant applied for 15 different PPP loans to eight different lenders, using 11 different companies, seeking a total of $24.8 million. The defendant obtained approximately $17.3 million and used the proceeds to purchase multiple homes, jewelry, and luxury vehicles. In another case, U.S. v. Richard Ayvazyan, et al., in the Central District of California, eight defendants applied for 142 PPP and EIDL loans seeking over $21 million using stolen and fictitious identities and sham companies, and laundered the proceeds through a web of bank accounts to purchase real estate, securities, and jewelry.
- Economic Injury Disaster Loans (EIDL) fraud: The department has also focused on fraud against the EIDL program, which was designed to provide loans to small businesses, agricultural and non-profit entities. Fraudsters have targeted the program by applying for EIDL advances and loans on behalf of ineligible newly-created, shell, or non-existent businesses, and diverting the funds for illegal purposes. The department has responded, primarily through the efforts of the U.S. Attorney's Office for the District of Colorado and their partners at the U.S. Secret Service, acting swiftly to seize loan proceeds from fraudulent applications, with $580 million seized to date and seizures ongoing. The EIDL Fraud Task Force in Colorado, comprised of personnel from five federal law enforcement agencies and federal prosecutors, is investigating a broad swath of allegedly fraudulently loans and their applicants. It is working to identify individual wrongdoers and networks of fraudsters appropriate for prosecution.
- Unemployment Insurance (UI) fraud: Due to the COVID-19 pandemic, more than $860 billion in federal funds has been appropriated for UI benefits through September 2021. Early investigation and analysis indicate that international organized criminal groups have targeted these funds by using stolen identities to file for UI benefits. Domestic fraudsters, ranging from identity thieves to prison inmates, have also committed UI fraud. In response, the department established the National Unemployment Insurance Fraud Task Force, a prosecutor-led multi-agency task force with representatives from more than eight different federal law enforcement agencies. Additionally, the department is hiring Assistant U.S. Attorneys in multiple U.S. Attorney’s Offices whose focus will be UI fraud prosecutions. Since the start of the pandemic, over 140 defendants have been charged and arrested for federal offenses related to UI fraud. In one case, U.S. v. Leelynn Danielle Chytka, in the Western District of Virginia, a defendant recently pleaded guilty for her role in a scheme that successfully stole more than $499,000 in UI benefits using the identities of individuals ineligible for UI, including a number of prisoners.
Through the department’s International Computer Hacking and Intellectual Property (ICHIP) program, ICHIP advisors have provided assistance and case-based mentoring to foreign counterparts around the globe to help detect, investigate and prosecute fraud related to the pandemic. The ICHIPs have helped counterparts combat cyber-enabled crime (e.g., online fraud) and intellectual property crime, including fraudulent and mislabeled COVID-19 treatments and sales of counterfeit pharmaceuticals. ICHIPs conducted webinars for foreign prosecutors and law enforcement in Asia, Africa, Europe, and South America on how to take down fraudulent COVID-19 websites. These webinars addressed methods for finding the registrar for a particular domain and requesting a voluntary takedown as well as the U.S. legal processes necessary for obtaining a court order that would bind a U.S. registrar. This has resulted in the take down of multiple online COVID-19 scams and significant seizures of counterfeit medicines and medical supplies such as masks, gloves, hand sanitizers and other illicit goods.
The department has also brought actions to combat coronavirus-related fraud schemes targeting American consumers. With scammers around the world attempting to sell fake and unlawful cures, treatments, and personal protective equipment, the department has brought dozens of civil and criminal enforcement actions to safeguard Americans’ health and economic security. The department has prosecuted or secured civil injunctions against dozens of defendants who sold products — including industrial bleach, ozone gas, vitamin supplements, and colloidal silver ointments — using false or unapproved claims about the products’ abilities to prevent or treat COVID-19 infections. The department has also worked to shutter hundreds of fraudulent websites that were facilitating consumer scams, and it has taken scores of actions to disrupt financial networks supporting such scams. The department is also coordinating with numerous agency partners to prevent and deter vaccine-related fraud.
The department is also using numerous civil tools to address fraud in connection with CARES Act programs. For example, in the Eastern District of California, the department obtained the first civil settlement for fraud involving the Paycheck Protection Program, resolving civil claims under the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA) and the False Claims Act (FCA) against an internet retail company and its president and chief executive officer arising from false statements to federally insured banks to influence those banks to approve, and the SBA to guarantee, a PPP loan. FIRREA allows the government to impose civil penalties for violations of enumerated federal criminal statutes, including those that affect federally-insured financial institutions. The FCA is the government’s primary civil tool to redress false claims for federal funds and property involving a multitude of government operations and functions. The FCA permits private citizens with knowledge of fraud against the government to bring a lawsuit on behalf of the United States and to share in any recovery. Such whistleblower complaints have been on the rise as unscrupulous actors take advantage of vulnerabilities created by the COVID-19 pandemic and the new government programs disbursing federal relief, and whistleblower cases will continue to be an essential source of new leads to help root out the misuse and abuse of taxpayer funds.
Indictments and other criminal charges referenced above are merely allegations, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
The unprecedented pace and tempo of these efforts is made possible only through the diligent work of a wide range of Justice Department partners, including the Criminal Division’s Fraud Section and Money Laundering and Asset Recovery Section, the Civil Division’s Commercial Litigation Branch (Fraud Section) and Consumer Protection Branch, U.S. Attorneys’ Offices throughout the country, and law enforcement partners from the FBI, Department of Labor Office of Inspector General, U.S. Secret Service, IRS-Criminal Investigation, Defense Criminal Investigative Service, Homeland Security Investigations, U.S. Postal Inspection Service, the Offices of Inspectors General from the Small Business Administration, Department of Homeland Security, Social Security Administration, Federal Deposit Insurance Corporation, Department of Health and Human Services, Department of Veterans Affairs, Federal Housing Finance Agency and Federal Reserve Board, Food and Drug Administration’s Office of Criminal Investigations, Treasury Inspector General for Tax Administration, Financial Crimes Enforcement Network, Special Inspector General for Pandemic Relief, Pandemic Response Accountability Committee, OCDETF Fusion Center and OCDETF’s International Organized Crime Intelligence and Operations Center.
To learn more about the department’s COVID response, visit: https://www.justice.gov/coronavirus. For further information on the Criminal Division’s enforcement efforts on PPP fraud, including court documents from significant cases, visit the following website: https://www.justice.gov/criminal-fraud/ppp-fraud. For further information on the Civil Division’s enforcement efforts, visit the following website: https://www.justice.gov/civil.
To report a COVID-19-related fraud scheme or suspicious activity, contact the National Center for Disaster Fraud (NCDF) by calling the NCDF Hotline at 1-866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
Abatement Supervisor Pleads Guilty to Illegally Removing AsbestosRead the Press Release
A New York man pleaded guilty today to illegally removing and disposing of asbestos.
According to court documents, during the summer of 2016, Gunay Yakup, 31, of Newburgh, joined an existing conspiracy to illegally remove asbestos from a former IBM site in Kingston. The facility in question contained over 400,000 square feet of regulated asbestos-containing material (RACM), as well as an additional 6,000 linear feet of RACM pipe wrap. Yakup, who had special asbestos abatement training, was hired as a worker and supervisor by an asbestos abatement company. On the job, he was pressured by other conspirators to expedite the removal of asbestos at the site. Doing so meant that Yakup and his crew violated the Clean Air Act’s “work practice standards,” which address how asbestos can be stripped, bagged, removed, and disposed of with relative safety. Yakup is scheduled to be sentenced on July 27 at 10 a.m. and faces a maximum penalty of five years in prison.
“Nowadays, it can be no surprise that asbestos is present in older commercial and industrial buildings,” said Acting Assistant Attorney General Jean E. Williams of the Justice Department’s Environment and Natural Resources Division. “What is surprising is that criminals still try to deal with that problem in dangerous ways to save a little cash. This prosecution serves to remind everyone of the real, personal risks of cutting those corners.”
“Yakup had the supervisor responsibility to ensure his workers properly removed hazardous asbestos material on this large project yet he knowingly broke the law,” said Special Agent Tyler Amon of the Environmental Protection Agency (EPA)'s Criminal Investigation Division in New York. “Impeding inspectors from discovering the full scale and scope of the illegal conduct is underscored in the serious federal charges plead to today.”
Yakup admitted that he and his co-conspirators removed substantial amounts of RACM from the former IBM site in violation of these work practice standards, oftentimes dry and in a way that produced visible emissions. They also stored bulk quantities of RACM waste on site in open containers. Yakup and his crew were also pressured to do work in areas that were not properly prepped to prevent the release of RACM to the outside air. Upon finding Yakup’s crew working on Aug. 1, 2016, New York State Department of Labor (NYSDOL) inspectors documented bulk quantities of uncontained RACM inside and outside of containment, dry debris, and evidence of sweeping and other dry removal abatement techniques. NYSDOL inspectors then “red-tagged” the site and prohibited further abatement work.
The site was later deemed to be contaminated by the Environmental Protection Agency (EPA) and other municipal authorities. Cleanup costs associated with asbestos contamination at the site are estimated to be in the millions. Asbestos has been determined to cause lung cancer, asbestosis, and mesothelioma, an invariably fatal disease. The EPA has determined that there is no safe level of exposure to asbestos.
Special agents of the EPA and individuals from the New York Departments of Labor and Environmental Conservation investigated the case.
Todd W. Gleason and Gary N. Donner of the Environment and Natural Resources Division’s Environmental Crimes Section prosecuted the case with the assistance of paralegal Chloe Harris.
Texas Man Sentenced for Trafficking in WildlifeRead the Press Release
A Texas man was sentenced to 20 months in prison for trafficking protected species and ordered to pay a $2,000 fine and be placed on supervised release for a period of two years after completing his prison term.
Alejandro Carrillo, 62, of El Paso, pleaded guilty on July 9, 2020, to a two-count information charging him with one count of conspiracy to traffic wildlife and one count of smuggling. Carrillo admitted to being part of a conspiracy to smuggle wildlife from the Mexico into the United States via El Paso since May 2016. Carrillo was the middleman between several Mexico-based suppliers of wildlife and their U.S.-based customers. Carrillo’s role as middleman was to pick up wildlife from a co-conspirator in Juarez, Mexico, and transport (smuggle) that wildlife in his car into the United States at an El Paso border crossing. His status as a U.S. citizen with a Secure Electronic Network for Travelers Rapid Inspection card made his transits easy. Once in the United States, Carrillo would ship the wildlife via FedEx or U.S. Postal Service to the U.S.-based customers. On many occasions, animals died during transport.
The sentencing was announced by Acting Assistant Attorney General Jean Williams of the Justice Department’s Environment and Natural Resources Division and Edward Grace, Assistant Director of the U.S. Fish and Wildlife Service (USFWS) Office of Law Enforcement.
“Trafficking in protected species in violation of U.S. and international law is harmful to the animals and their native habitats,” said Acting Assistant Attorney General Jean E. Williams of the Justice Department’s Environment and Natural Resources Division. “The Justice Department remains determined to work with our law enforcement partners to ensure that these endangered animals are protected.”
“Wildlife trafficking is decimating much of the world’s natural resources,” said the USFWS Office of Law Enforcement Assistant Director Edward Grace. “It is paramount to deter and dismantle wildlife traffickers in order to ensure the sustainability of our natural resources, protect against zoonotic diseases from spreading, and so that future generations will be able to benefit from the world’s diverse species of wildlife and plants.”
Between April 2015 and December 2019, Carrillo illegally transported wildlife across the U.S.-Mexico border with a market value of over $3,500,000. Carrillo received a “crossing fee” for each border crossing, the amount of which depended on the number of animals transported, the size of the packages, and, in some cases, the level of risk of being detected by the authorities. In that time period, Carrillo was paid more than $198,000 to transport wildlife across the U.S.-Mexico border.
On Sept. 22, 2016, Carrillo picked up several reptiles from a supplier in Juarez, including a Central American river turtle (Dermatemys mawaii), which is a Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES)-protected and endangered species, and transported them across the U.S.-Mexico border to his residence in El Paso. He then re-packaged the animals and sent them to a buyer in Oklahoma. The total value of the shipment was $1,650. Carrillo did not have a CITES import permit for any of the smuggled animals, nor were any permits issued in the name of any of the suppliers. In addition, Carrillo did not submit the necessary import wildlife declaration form to the USFWS.
The USFWS Office of Law Enforcement and the Environment and Natural Resources Division’s Environmental Crimes Section investigated the case.
Trial Attorneys Mary Dee Carraway and Gary Donner of the Environmental Crimes Section prosecuted the case.
Michigan Businessman Charged with Tax Evasion Among Other OffensesRead the Press Release
A federal grand jury in Detroit, Michigan, returned an indictment yesterday charging a Bloomfield Hills businessman with tax evasion, attempting to obstruct the internal revenue laws, making a false statement, and willful failure to file his own individual income tax return.
According to the indictment, Ryan Richmond owned and operated Relief Choices LLC, a medical marijuana dispensary in Warren. The indictment alleges that from 2011 through at least 2014, Richmond caused Relief Choices to make extensive use of cash to pay business operating expenses and routed customer business credit card payments through an unrelated third-party bank account to conceal his actual business gross receipts from the IRS. In 2015 and 2016, Richmond allegedly made false statements about his control of, profit from, and work responsibilities for Relief Choices to an IRS auditor.
If convicted, Richmond faces a statutory maximum sentence of five years in prison for each count of tax evasion and false statements, three years in prison for the obstruction of the IRS count, and a maximum sentence of one year in prison for the failure to file a tax return count. Richmond also faces a period of supervised release, restitution, and monetary penalties. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and Acting U.S. Attorney Saima S. Moshin for the Eastern District of Michigan made the announcement.
The IRS-Criminal Investigation is investigating the case.
Trial Attorneys Mark McDonald and Sean Green of the Tax Division are prosecuting the case.
An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Former Oil Trader Pleads Guilty to Commodities Price Manipulation ConspiracyRead the Press Release
A California man pleaded guilty Wednesday to a multiyear conspiracy to engage in commodities price manipulation.
According to court documents and statements made in court, Emilio Jose Heredia Collado, 49, of Lafayette, was employed as a trader at Company A, an oil trading company, and later at Company B, a multinational commodity trading company, after it had acquired Company A. Between approximately September 2012 and August 2016, Heredia conspired with other employees at Company A, and later at Company B, to manipulate the price of fuel oil bought from, and sold to, a particular counterparty, Company C, through private, bilateral contracts.
“The defendant and his co-conspirators unlawfully manipulated the fuel oil market for their own gain by creating artificial prices that undermined the legitimate forces of supply and demand in one of our nation’s key commodity markets,” said Acting Assistant Attorney General Nicholas L. McQuaid of the Justice Department’s Criminal Division. “This prosecution demonstrates the department’s commitment to working with our law enforcement partners to identify and prosecute individuals who would seek to manipulate commodities benchmark prices while trading in the open market.”
“Individuals profiteering, through the manipulation of daily price assessments of a valuable commodity, fuel oil, prior to the purchasing or selling of it, goes against the most fundamental concepts of a supply-and-demand market economy,” said Assistant Inspector in Charge Raimundo Marrero of the U.S. Postal Inspection Service Criminal Investigation Group. “These fraudulent practices have no place in the international marketplace. This guilty plea showcases the U.S. Postal Inspection Service’s tenacity to hold individuals accountable for their dishonest actions and the resolve to continue to protect consumers and businesses. To criminals out there, the U.S. Postal Inspection Service and our federal partners will ensure your criminal endeavors are brought to justice.”
Heredia and his co-conspirators sought to unlawfully enrich themselves, Company A, and Company B by increasing profits and reducing costs on the fuel oil contracts with Company C. The price terms of the contracts were set by reference to the daily benchmark price assessment published by S&P Global Platts (Platts) for intermediate fuel oil 380 CST at the Port of Los Angeles (Los Angeles 380 CST Bunker Fuel) on a certain day or days plus or minus a fixed premium. As part of the price manipulation conspiracy, Heredia directed his co-conspirators to submit orders to buy and sell (bids and offers) to Platts during the daily trading “window” for the Platts Los Angeles 380 CST Bunker Fuel price assessment with the intent to artificially push the price assessment up or down.
For example, if Company A or Company B had a contract to buy fuel oil from Company C, Heredia directed his co-conspirators to submit offers during the Platts “window” for the express purpose of pushing down the price assessment and hence the price of fuel oil bought from Company C. The bids and offers were not submitted to Platts for any legitimate economic reason by Heredia’s and his co-conspirators, but rather for the purpose of artificially affecting the Platts Los Angeles 380 CST Bunker Fuel price assessment so that the benchmark price, and hence the price of fuel oil that Company A or Company B bought from, and sold to, Company C, did not reflect legitimate forces of supply and demand.
The U.S. Postal Inspection Service is investigating the case.
Acting Principal Assistant Chief Avi Perry and Trial Attorney Matthew F. Sullivan of the Justice Department’s Fraud Section are prosecuting the case.
The Criminal Division’s Fraud Section plays a pivotal role in the Justice Department's fight against white collar crime around the country and is the national leader in prosecuting fraud and manipulation in the U.S. commodity markets.
Readout of U.S. Attorney General Merrick B. Garland’s Participation in the Virtual Ministerial with Home Affairs Ministers of the G6 CountriesRead the Press Release
Earlier today, U.S. Attorney General Merrick B. Garland met virtually with the Home Affairs Ministers of France, Germany, Italy, Poland, Spain, and the United Kingdom to advance cooperation against transnational crime, terrorism, and malign foreign interference. During the constructive dialogue, leaders discussed enhancing international sharing of law enforcement information, including through INTERPOL, and also addressed particular threats such as online child sexual exploitation and abuse, and trafficking and smuggling of humans. The ministerial was the Attorney General’s first international engagement in office.
U.S. Attorney General Garland was joined by U.S. Department of Homeland Security (DHS) Secretary Alejandro Mayorkas. The meeting was hosted and chaired by United Kingdom Home Secretary Priti Patel. Other G6 attendees included French Interior Minister Gerald Darmanin, German Interior Minister Horst Seehofer, Italian Interior Minister Luciana Lamorgese, Polish Interior Minister Mariusz Kamiński, Spanish Interior Minister Fernando Grande-Marlaska, EU Vice-President Margaritis Schinas, and EU Commissioner Ylva Johansson.
Attorney General Garland addresses officials of the G6 CountriesOwner of Plumbing Businesses Pleads Guilty to Employment Tax FraudRead the Press Release
A Montana businessman pleaded guilty today to employment tax fraud.
According to court documents, Thomas O’Connell owned and operated three plumbing businesses, Quality Plumbing and Heating, Orbit Plumbing and Heating, and Orbit PHC, each based in Great Falls. From at least 2005 through 2016, O’Connell did not pay employment taxes for several quarters, despite being obligated to ensure such taxes were paid to the IRS. Instead, he directed payments to other creditors and to his own personal expenses. The total tax loss to the IRS from O’Connell’s conduct is more than $550,000.
O’Connell is scheduled to be sentenced on June 24, 2021, and faces a maximum sentence of five years in prison. He also faces a period of supervised release, restitution, and monetary penalties. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and Acting U.S. Attorney Leif M. Johnson for the District of Montana made the announcement.
IRS-Criminal Investigation is investigating the case.
Trial Attorney Mark S. Determan of the Justice Department’s Tax Division and Assistant U.S. Attorney Ryan G. Weldon of the District of Montana are prosecuting the case.
Antitrust Division Issues 2021 Annual NewsletterRead the Press Release
The Department of Justice’s Antitrust Division today issued the 2021 edition of its annual Spring Newsletter. The newsletter highlights the division’s recent activities and successes on civil and criminal enforcement, diversity initiatives, international cooperation, and competition advocacy. The newsletter also includes a message from Acting Assistant Attorney General Richard Powers.
“Thanks to the dedication of the division’s employees, we’ve continued our efforts on behalf of American consumers, workers, and taxpayers despite the crisis posed by COVID-19,” said Acting Assistant Attorney General Richard A. Powers. “As the Acting Assistant Attorney General, it is my privilege to work with the division’s phenomenal staff as we continue our critical work through this transition period. The civil servants who work for the division are deeply invested in promoting competition and making the economy fairer for all Americans. I am grateful to them and intend to make sure that all employees are fully supported and empowered to do their important work and that we remain a process driven organization.”
The newsletter highlights the division’s accomplishments and features profiles of division staff. It can be found at https://www.justice.gov/atr/division-operations/division-update-spring-2021.
Justice Department Settles Sexual Harassment Lawsuit Against Cumberland County, Tennessee for $1.1 MillionRead the Press Release
The Justice Department announced today that it has reached a settlement with Cumberland County, Tennessee, to resolve allegations that the county discriminated against ten female employees because of their sex in violation of Title VII of the Civil Rights Act of 1964.
Title VII is a federal statute that prohibits employment discrimination on the basis of race, sex, color, national origin and religion. Under the terms of the settlement, which still must be approved by the court in the form of a consent decree, Cumberland County will pay approximately $1.1 million in compensatory damages to ten women whom the United States alleged were sexually harassed by the former director of the county’s Solid Waste Department. Cumberland County will also revise its policies, procedures, and training to better prevent sexual harassment in the workplace.
“Today’s resolution, through settlement, will bring some measure of closure and vindication to the vulnerable women who were victimized by the egregious and abusive behavior in this case,” said Pamela S. Karlan, Principal Deputy Assistant Attorney General of the Civil Rights Division. “Sexual harassment must not be tolerated in the workplace, and we remain committed to eliminating it root and branch through our vigorous enforcement of Title VII.”
“No individual should have to endure the unwanted sexual advances of another, especially from someone who wields a position of authority over another as alleged here,” said Acting U.S. Attorney Mary Jane Stewart for the Middle District of Tennessee. “We will seek all available remedies to address such unwanted and unlawful conduct and will continue to protect the civil rights of all of our citizens. They deserve nothing less.”
“State and local governments are among our largest employers. It is important that they understand that the federal anti-discrimination laws also apply to them,” said Delner Franklin-Thomas, District Director of the Memphis District of the Equal Employment Opportunity Commission (EEOC). “The egregious sexual harassment that these women were subjected to contravenes Title VII. The EEOC will continue to collaborate with the Justice Department to ensure the protection of our workers in governmental workplaces.”
The Justice Department’s complaint, filed March 8, in the U.S. District Court for the Middle District of Tennessee, alleged, among other things, that Cumberland County failed to take adequate precautions to prevent the former director of the county’s Solid Waste Department from sexually harassing the women. According to the complaint, the former director regularly subjected the women, who all worked for him, to unwanted sexual contact, including kissing and groping; unwelcome sexual advances, including propositioning the women for sexual favors; and offensive sexual remarks about their bodies and sex acts. The former director has been indicted on criminal charges and is awaiting trial in state court.
Four of the women had filed charges of discrimination with the EEOC. The EEOC’s Nashville Area Office, in its Memphis District, investigated the charges and found reasonable cause to believe Cumberland County discriminated against the four women and other similarly situated employees. After unsuccessful conciliation efforts, the EEOC referred the charges to the Justice Department’s Civil Rights Division. The Justice Department brought this lawsuit as part of a joint effort to enhance collaboration between the Department and the EEOC in the vigorous enforcement of Title VII.
This lawsuit is part of the Civil Rights Division’s Sexual Harassment in the Workplace Initiative, which is aimed at eradicating sexual harassment in state and local government workplaces. It focuses on litigation, outreach and development of effective remedial measures to address and prevent future sex discrimination and harassment.
This lawsuit was handled by Trial Attorneys Jen Swedish and Julia Quinn of the Civil Rights Division’s Employment Litigation Section and by Assistant U.S. Attorney Kara Sweet of the U.S. Attorney’s Office for the Middle District of Tennessee.
The full and fair enforcement of Title VII is a top priority of the Employment Litigation Section of the Civil Rights Division. Additional information about the Civil Rights Division and the jurisdiction of the Employment Litigation Section is available on its websites at www.justice.gov/crt/ and https://www.justice.gov/crt/employment-litigation-section.
Indian Cancer Drug Manufacturer to Pay $50 Million for Concealing and Destroying Records in Advance of FDA InspectionRead the Press Release
Indian drug manufacturer Fresenius Kabi Oncology Limited (FKOL) was sentenced to pay $50 million in fines and forfeiture after pleading guilty to concealing and destroying records prior to a 2013 U.S. Food and Drug Administration (FDA) plant inspection.
In a criminal information previously filed in federal court in the District of Nevada, the United States charged FKOL with violating the Federal Food, Drug and Cosmetic Act by failing to provide certain records to FDA investigators. As part of a criminal resolution with the Department of Justice, FKOL agreed to plead guilty to the misdemeanor offense. U.S. District Judge Jennifer A. Dorsey accepted the company’s guilty plea and sentenced FKOL to pay a criminal fine of $30 million, forfeit an additional $20 million, and implement a compliance and ethics program designed to prevent, detect, and correct violations of U.S. law relating to FKOL’s manufacture of cancer drugs intended for terminally ill patients.
“By concealing and destroying drug manufacturing records, FKOL undermined FDA’s regulatory authority and placed vulnerable consumers at risk,” said Acting Assistant Attorney General Brian M. Boynton of the Justice Department’s Civil Division. “Today’s sentence holds the company accountable for its past conduct and seeks to ensure it will fully comply with its obligations to the FDA going forward.”
According to court documents, FKOL owned and operated a manufacturing plant in Kalyani, West Bengal, India, that manufactured active pharmaceutical ingredients (APIs) used in various cancer drug products distributed to the United States. Prior to a January 2013 FDA inspection of the Kalyani facility, FKOL plant management directed employees to remove certain records from the premises and delete other records from computers that would have revealed FKOL was manufacturing drug ingredients in contravention of FDA requirements. Kalyani plant employees removed computers, hardcopy documents, and other materials from the plant and deleted spreadsheets that contained evidence of the plant’s noncompliant practices.
“Today’s sentencing reflects our office’s and the department’s commitment to holding accountable companies that disregard FDA regulations, at the risk of consumers’ health and safety,” said Acting U.S. Attorney Christopher Chiou for the District of Nevada. “Together with our agency partners, we will continue to ensure that drug manufacturers fully comply with their obligations to maintain the integrity of records and data.”
“FDA inspections of pharmaceutical manufacturing facilities help ensure the strength, quality and purity of our medicines,” said Judy McMeekin, Pharm.D., Associate Commissioner for Regulatory Affairs of the FDA. “Today’s sentencing proves that we will continue to aggressively investigate and bring to justice those who attempt to subvert requirements that protect the public health.”
The FDA Office of Criminal Investigations, Los Angeles Field Office, investigated the case. The Central Bureau of Investigation in India provided invaluable assistance to U.S. authorities in the investigation of this matter. The Justice Department’s Office of International Affairs provided investigative assistance.
This case was prosecuted by Assistant Director Clint Narver and Trial Attorney Natalie Sanders of the Civil Division’s Consumer Protection Branch, with assistance from Assistant U.S. Attorney Nicholas D. Dickinson of the U.S. Attorney’s Office for the District of Nevada.
Former Ecuadorian Government Official Sentenced to Prison for Role in Bribery and Money Laundering SchemeRead the Press Release
An Ecuadorian and Italian national was sentenced today to 51 months in prison for his role in a scheme to launder bribes paid to him in exchange for helping three U.K. reinsurance companies obtain and retain reinsurance business from Ecuador’s public surety company.
Juan Ribas Domenech, 52, pleaded guilty to one count of conspiracy to commit money laundering on Sept. 16, 2020. According to court documents, between 2013 and 2017, Ribas was the chairman of Seguros Sucre, Ecuador’s state-owned and -controlled surety company and an advisor to the then-president of Ecuador. In those capacities, Ribas had authority over the awarding of Seguros Sucre business. During that time, Ribas accepted approximately $5,036,465 in bribes from his co-conspirators in exchange for using his official position to allow three U.K.-based reinsurance brokers to obtain and retain contracts with Seguros Sucre. These bribe payments were paid through various intermediaries, including two reinsurance introducer companies. A portion of the bribes were laundered through the United States.
Acting Assistant Attorney General Nicholas L. McQuaid of the Justice Department’s Criminal Division; Special Agent in Charge Kelly R. Jackson of the IRS-Criminal Investigation (IRS-CI) Washington, D.C. Field Office; Special Agent in Charge Raymond Villanueva of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) Washington, D.C. Field Office; and Special Agent in Charge George L. Piro of the FBI’s Miami Field Office made the announcement.
IRS-CI’s and HSI’s Washington, D.C. offices, jointly under the auspices of the Global Illicit Financial Team, and the FBI’s Miami International Corruption Squad investigated the case.
Trial Attorneys Katherine Raut, La’Nese Clarke, and Alexander Kramer of the Justice Department’s Fraud Section prosecuted the case.
The Fraud Section is responsible for investigating and prosecuting all Foreign Corrupt Practices Act (FCPA) matters. Additional information about the Justice Department’s FCPA enforcement efforts can be found at www.justice.gov/criminal/fraud/fcpa.
East L.A. Gang Member Who Led Firebombing of African-American Residences Sentenced to 16 Years in Federal PrisonRead the Press Release
A senior member of the Big Hazard street gang was sentenced today to 192 months in federal prison for orchestrating and executing the nighttime firebombing of African-American families at the Ramona Gardens Housing Development in Boyle Heights in 2014 in order to force the residents out of their homes.
Carlos Hernandez, 36, aka “Rider” or “Creeper,” was sentenced by The Honorable U.S. District Judge Christina A. Snyder. During the hearing, Judge Snyder explained that her sentence was intended to “send a message to the community that hate crimes will not be tolerated” and that this was “not a time for any court to tolerate hate crimes.”
Hernandez pleaded guilty in April 2019 to five felony counts: conspiracy to violate civil rights, violent crime in aid of racketeering, criminal interference with fair housing rights, use of fire in the commission of a federal felony, and carrying a firearm in the commission of a crime of violence.
“The defendant planned, coordinated, and led these racially-motivated attacks that targeted vulnerable families, including grandparents and infants, while they were sleeping peacefully in their own homes,” said Principal Deputy Assistant Attorney General Pamela S. Karlan of the Justice Department’s Civil Rights Division. “The Justice Department will continue to prioritize the prosecution of hate-fueled violence.”
“The defendants in this case perpetrated hate crimes that targeted innocent victims in their homes simply because of their skin color,” said Acting U.S. Attorney Tracy Wilkison of the Central District of California. “These despicable acts are simply unacceptable in our society. We are committed to protecting everyone’s civil rights, and anyone who participates in this type of conduct will find that the federal government will marshal all of its resources to ensure they are brought to justice.”
"There is absolutely no place for race-based violence in a civilized society," said Kristi K. Johnson, the Assistant Director in Charge of the FBI’s Los Angeles Field Office. "Investigators worked diligently to identify Mr. Hernandez as the one who masterminded this crime and arrested Hernandez and others before they could target another innocent victim. The FBI will continue to protect the civil rights of our community by holding responsible anyone so filled with hate that they would attempt to commit murder based on the color of a victim's skin.”
On the evening of May 11, 2014, which was Mother’s Day, Hernandez organized and led seven co-defendants – all members of the Big Hazard street gang – in a plan to firebomb several apartments in the Ramona Gardens housing complex. Hernandez and his co-defendants targeted each of the residences because African-Americans lived there. Hernandez divided the defendants into groups to carry out the fire-bombings, assigned each defendant a specific role within those groups, and provided various defendants with a lighter or hammer to be used in the attacks, as well as masks to conceal their identities. The defendants stashed their cell phones to prevent law enforcement tracking and traveled a predetermined route designed to evade surveillance cameras. Heightening the dangerousness of the attacks, Hernandez armed himself with a semiautomatic handgun.
Once the gang members located the targeted apartments, they smashed the windows of four apartments to allow for cleaner entry of the firebombs to maximize damage. Hernandez and his co-defendants then threw lit Molotov cocktails into the residences. Three of the four targeted apartments were occupied by African American families who were sleeping at the time of the unprovoked attack. A mother who was sleeping with her infant baby on her chest at the time of the attack barely evaded being hit by a firebomb when she rolled off the couch with her baby after hearing a window shatter. A federal task force with numerous federal agencies and local partners was established to investigate the attack, which remained unsolved for two years until prosecutors unsealed the charges in this matter.
Today’s sentencing hearing follows the sentencings of several other defendants in this case: Jose Saucedo, aka “Lil Mo,” 156 months; Josue Garibay, aka “Malo,” 144 months; Jonathan Portillo, aka “Pelon,” 63 months; Francisco Farias, aka “Bones,” 42 months; and Edwin Felix, aka “Boogie,” 92 months.
All of the defendants who participated in the firebombing were charged in 2016 and have pleaded guilty to federal hate crime and related offenses. Those defendants also all admitted that they participated in the firebombing attacks because of the victims’ race and color and with the intent to force the victims to move away from the federally funded housing complex.
The investigation into the firebombing was conducted by agents and detectives with the FBI; the Los Angeles Police Department; the Los Angeles Fire Department; and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
This case is being prosecuted by Assistant U.S. Attorney Mack E. Jenkins, Chief of the Public Corruption and Civil Rights Section and Justice Department Special Litigation Counsel Julia Gegenheimer of the Civil Rights Division’s Criminal Section.
For more information and resources on the Department’s efforts to combat hate crimes, visit www.justice.gov/hatecrimes. If you believe you have been a victim of a civil rights violation please visit: https://civilrights.justice.gov/ to file a report.
Medical Doctor and Study Coordinator Sentenced to Prison in Scheme to Falsify Clinical Trial DataRead the Press Release
A Florida medical doctor was sentenced to 63 months in prison after pleading guilty to her role in a scheme to falsify clinical trial data regarding an asthma medication.
Dr. Yvelice Villaman Bencosme, 64, of Miami, previously pleaded guilty in U.S. District Court for the Southern District of Florida to one count of conspiracy to commit wire fraud related to her work at Unlimited Medical Research in Miami. Bencosme is the second defendant to be sentenced in connection with the scheme. On March 5, 2021, Lisett Raventos, 46, of Miami, was sentenced to 30 months in prison after also pleading guilty to conspiracy to commit wire fraud.
Bencosme was a licensed medical doctor who served as the primary investigator for clinical trials purportedly conducted at Unlimited Medical Research. Raventos was the site director, the director of clinical operations, and a study coordinator at the clinic. In pleading guilty, Bencosme and Raventos admitted that they participated in a scheme to defraud an unnamed pharmaceutical company by fabricating the data and participation of subjects in a clinical trial at Unlimited Medical Research.
The clinical trial was designed to investigate the safety and efficacy of an asthma medication in children between the ages of four and 11. Bencosme and Raventos admitted that they falsified medical records to make it appear as though pediatric subjects made scheduled visits to Unlimited Medical Research, took study drugs as required, and received checks as payment. In sentencing Raventos, U.S. District Judge Beth Bloom said that if the defendants’ actions had been left unchecked, the scheme “could have negatively impacted the treatment and well-being of children with asthma throughout the country.”
“Falsifying clinical trial data risks the health of those who might later rely on the drugs being tested,” said Acting Assistant Attorney General Brian M. Boynton of the Justice Department’s Civil Division. “The Department of Justice will continue working with its partners at the Food and Drug Administration to investigate and prosecute anyone who endangers the public for personal gain.”
“Clinical trials are an essential part of the medical research process, as they ensure the effectiveness and safety to patients of new drugs,” said U.S. Attorney Ariana Fajardo Orshan for the Southern District of Florida. “Those who manipulate clinical data risk the public’s health and such criminal behavior will be prosecuted.”
“FDA’s evaluation of a new drug begins with an analysis of reliable and accurate data from clinical trials. Compromised clinical trial data could impact the agency’s decisions about the safety and effectiveness of the drug under review,” said Special Agent in Charge Justin C. Fielder of the Food and Drug Administration (FDA) Office of Criminal Investigations, Miami Field Office. “We will continue to investigate and bring to justice those whose actions may subvert the FDA drug approval process and put the public health at risk.”
Another defendant in the case, Maytee Lledo, pleaded guilty in February 2021 to conspiracy to commit wire fraud. She is scheduled to be sentenced on April 16, 2021, in Miami.
Trial Attorneys Joshua Rothman and Kara M. Traster of the Civil Division’s Consumer Protection Branch are prosecuting the case. The FDA’s Office of Criminal Investigations, Miami Field Office investigated the case and the U.S. Attorney’s Office of the Southern District of Florida has provided critical assistance.
Justice Department Sues Detroit-Area Tax Preparation Franchisor, Four Others Using Franchise Name, to Stop Alleged Tax FraudRead the Press Release
The United States has filed four civil injunction suits in federal court in the U.S. District Court for the Eastern District of Michigan. The suits seek to enjoin a Detroit-area tax preparation franchisor from owning, operating and franchising tax preparation businesses and to prohibit the franchisor, as well as certain others that have agreements to operate using her business’s name, from preparing tax returns for others. The complaints also request that the court require all defendants to disgorge the return preparation fees they obtained by preparing allegedly false and fraudulent tax returns.
The complaint against Jeanisia Allen alleges that she owns, operates, and franchises a tax return preparation business known as “The Tax Experts” through co-defendants First Choice Tax Solutions LLC, The Tax Experts Inc., The Tax Experts LLC, and Top Notch Taxes Inc. The other three complaints allege that Jennifer Sherman, Erica McGowan, Annetta Powell, and Jasmine Powell have each entered into agreements with Jeanisia Allen and her entity, The Tax Experts LLC, to use the name “The Tax Experts.”
Each of the government’s complaints allege that the defendants and their entities prepare and file tax returns to falsely increase their customers’ refunds, and profit through high and often undisclosed preparation fees at the expense of their customers and the U.S. Treasury. The complaints allege that the defendants engaged in misconduct, including falsely claiming the earned income tax credit; fabricating businesses, business income and expenses, resulting in understated tax liabilities; claiming false education credits; and claiming improper filing statuses. The complaints each allege that defendants’ activities have harmed their customers, who now may be liable for sizable penalties and interest.
According to the complaint against Allen, The Tax Experts has operated at least 32 stores, primarily in metro-Detroit, but also in Chicago and Los Angeles. Over the course of three years (2017, 2018, and 2019), businesses operating as “The Tax Experts” allegedly prepared more than 17,000 federal tax returns claiming over $82 million in tax refunds. The complaint alleges that Allen and The Tax Experts failed to train, oversee and control businesses that operate under an agreement to use that name, including failing to review tax returns prepared at franchise stores, resulting in the preparation of false or fraudulent tax returns exhibiting common and widespread false income, expenses, claims, credits and deductions. According to the complaint against Allen, the IRS examined 716 federal tax returns prepared by The Tax Experts, resulting in a total additional tax owed to the United States of $3,552,114, or an average of $5,349.57 for each adjusted return.
“Particularly during this time of year when honest taxpayers are filing their returns, we want the public to know that, working with our partners at the IRS, the Justice Department will pursue those who would abuse our nation’s tax laws,” said Acting Assistant Attorney General David A. Hubbert of the Justice Department’s Tax Division. “Fraudulent tax return preparers too often seek to take advantage of their customers and the U.S. Treasury, undermining our tax system.”
Return preparer fraud is one of the IRS’ Dirty Dozen Tax Scams and taxpayers seeking a return preparer should remain vigilant. (More information can also be found here.) The IRS has information on its website for choosing a tax preparer, has launched a free directory of federal tax preparers, and offers information on how to avoid “ghost” tax preparers, whose refusal to sign a return should be a red flag to taxpayers. The IRS also has a list of important reminders for taxpayers who are about to file their 2020 tax returns, including how to prepare for a smooth filing process.
In addition, IRS Free File, a public-private partnership, offers free online tax preparation and filing options on IRS partner websites for individuals whose adjusted gross income is under $72,000. For individuals whose income is over that threshold, IRS Free File offers electronic federal tax forms that can be filled out and filed online for free.
In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.
Justice Department Settles Investigation into Language Barriers in the Colorado Administrative Court SystemRead the Press Release
The Justice Department today announced it has reached a settlement agreement with the Colorado Office of Administrative Courts (OAC) to help people with limited English proficiency (LEP) access timely and competent language assistance in the court system.
The OAC is an administrative court that hears workers’ compensation claims, as well as claims in other critical areas such as civil rights, environmental justice, education, and transportation. The agreement resolves a Justice Department investigation of the OAC under Title VI of the Civil Rights Act of 1964. Title VI prohibits discrimination on the basis of race, color and national origin by recipients of federal assistance, such as the OAC. The Justice Department’s review uncovered concerns with OAC’s Title VI compliance, including a rule that prohibited the OAC from providing qualified interpreters to help limited English proficient individuals understand and participate in their court proceedings.
“For people with limited English proficiency, not getting the language services they need to participate meaningfully in a court proceeding can have truly devastating consequences," said Pamela S. Karlan, Principal Deputy Assistant Attorney General for the Civil Rights Division. "We can’t achieve our nation’s promise of access to justice for all without dismantling language barriers in our judicial system. I commend the OAC’s Chief Judge and leadership for taking action to realize this promise and for their commitment to provide critical services for court users with limited English proficiency.”
“This agreement will result in real help for people who seek justice in Colorado’s administrative court system but who don’t speak English,” said Acting U.S. Attorney for the District of Colorado Matt T. Kirsch. “I appreciate that Colorado’s Office of Administrative Courts recognized an opportunity to work with our office and the Civil Rights Division in crafting an agreement that will benefit communities in Colorado that speak languages other than English.”
A key aspect of the OAC’s implementation of the settlement will be a revision to its Rule 21, which will now require the OAC to provide qualified interpreters at no cost to LEP individuals in court proceedings. In addition, the OAC has created a language access policy and plan and agreed to provide notice of language assistance services in at least the top eight languages it encounters. The OAC will create and publicize a language access complaint process, and require annual training on LEP issues for judges, staff, and contractors. The strong support and active participation of the OAC’s Chief Judge and Colorado Office of the Attorney General have been key to the swift and cooperative resolution of this matter.
Under the terms of the agreement signed today, the Justice Department will monitor the OAC’s compliance for two years.
The enforcement of Title VI of the Civil Rights Act of 1964 is a top priority of the Civil Rights Division. Additional information about the Civil Rights Division is available on its website at www.justice.gov/crt, and information about limited English proficiency and Title VI is available at www.lep.gov. Members of the public may report possible civil rights violations at https://civilrights.justice.gov/report/.
Justice Department Seeks to Shut Down Mississippi Return PreparerRead the Press Release
The United States filed a complaint in the U.S. District Court for the Southern District of Mississippi seeking to bar a Mississippi tax return preparer from owning or operating a tax return preparation business and preparing tax returns for others.
The civil complaint was filed against Terance Price, both individually and doing business as Superior Taxes. It alleges that Price knowingly took unreasonable positions on returns he prepared that led to understatements of the tax customers owed or overstatements of the refunds to which they were entitled to receive. In particular, the complaint alleges that Price prepared returns that claimed residential energy credits, fuel tax credits, or unreimbursed employee business expenses that he knew were false. According to the complaint, the IRS has assessed penalties against Price for failing to comply with due diligence requirements that obligate a tax return preparer to make reasonable inquiries to ensure that a customer is legitimately entitled to various tax credits, including the earned income tax credit. The complaint alleges that Price has not paid the penalties incurred for past violations of those due diligence requirements.
The complaint further alleges that Price filed hundreds of tax returns each filing season since 2015, the year in which he began operating his tax preparation business, and that he has filed tax returns using other tax preparers’ personal identifying information. According to the complaint, the potential tax losses from the returns that Price prepared for tax years 2017 and 2018 could exceed $1 million, and actual losses from his activities could surpass that estimate. In addition, the complaint alleges that Price’s conduct harms his customers, who are responsible for these tax deficiencies and, potentially, interest and penalties.
Acting Assistant Attorney General David A. Hubbert of the Justice Department’s Tax Division made the announcement.
Return preparer fraud is one of the IRS’ Dirty Dozen Tax Scams and taxpayers seeking a return preparer should remain vigilant. (More information can also be found here.) The IRS has information on its website for choosing a tax preparer, has launched a free directory of federal tax preparers, and offers information on how to avoid “ghost” tax preparers, whose refusal to sign a return should be a red flag to taxpayers. The IRS also has a list of important reminders for taxpayers who are about to file their 2020 tax returns, including how to prepare for a smooth filing process.
In addition, IRS Free File, a public-private partnership, offers free online tax preparation and filing options on IRS partner websites for individuals whose adjusted gross income is under $72,000. For individuals whose income is over that threshold, IRS Free File offers electronical federal tax forms that can be filled out and filed online for free.
In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.
El Departamento de Justicia Resuelve Investigación Sobre las Barreras del Idioma en el Sistema Judicial Administrativo de ColoradoRead the Press Release
El Departamento de Justicia anunció hoy que ha llegado a un acuerdo conciliatorio con la Oficina de Tribunales Administrativos de Colorado (OAC, por sus siglas en inglés) para ayudar a las personas con dominio limitado del inglés (LEP, por sus siglas en inglés) a acceder a asistencia lingüística oportuna y competente en el sistema judicial.
La OAC es un tribunal administrativo que atiende las reclamaciones de indemnización laboral, así como las reclamaciones en otras áreas críticas como los derechos civiles, la justicia ambiental, la educación y el transporte. El acuerdo resuelve una investigación del Departamento de Justicia de la OAC bajo el Título VI de la ley de Derechos Civiles de 1964. El Título VI prohíbe la discriminación por motivos de raza, color de piel y origen nacional por parte de las entidades beneficiarias de asistencia federal, como la OAC. La revisión del Departamento de Justicia descubrió inquietudes con el cumplimiento del Título VI de parte de la OAC, incluida una regla que prohibía a la OAC proporcionar intérpretes calificados para ayudar a las personas con dominio limitado del inglés a comprender y participar en sus procedimientos judiciales.
“Para las personas con dominio limitado del inglés, el no recibir los servicios lingüísticos que necesitan para participar de manera significativa en un procedimiento judicial puede tener consecuencias realmente devastadoras. No podemos cumplir la promesa de nuestra Nación de acceso a la justicia para todos sin desmantelar las barreras del idioma en nuestro sistema judicial”, señaló Pamela S. Karlan, fiscal general auxiliar adjunta principal de la División de Derechos Civiles. “Felicito al juez presidente y al liderazgo de la OAC por tomar medidas para cumplir esta promesa y por su compromiso de brindar servicios críticos para los usuarios de los tribunales con un dominio limitado del inglés.”
“Este acuerdo redundará en una ayuda real para las personas que buscan justicia en el sistema de tribunales administrativos de Colorado pero que no hablan inglés”, comentó el fiscal federal interino para el Distrito de Colorado Matt Kirsch. “Agradezco que la Oficina de Tribunales Administrativos de Colorado haya reconocido la oportunidad de trabajar con nuestra oficina y la División de Derechos Civiles en la elaboración de un acuerdo que beneficiará a las comunidades de Colorado que hablan otros idiomas que no son el inglés.”
Un aspecto clave de la implementación del acuerdo por parte de la OAC será una revisión de su Regla 21, que ahora exigirá que la OAC proporcione intérpretes calificados sin costo para las personas LEP en los procedimientos judiciales. Además, la OAC ha creado una política y un plan de acceso lingüístico, y ha acordado notificar los servicios de asistencia lingüística en al menos los ocho idiomas principales con que se encuentra. La OAC creará y publicará un proceso de quejas de acceso lingüístico y exigirá la capacitación anual sobre cuestiones de LEP para jueces, personal y contratistas. El fuerte apoyo y la participación activa del juez presidente de la OAC y la Fiscalía General de Colorado han sido clave para la resolución rápida y cooperativa de este asunto.
Según los términos del acuerdo firmado hoy, el Departamento de Justicia supervisará el cumplimiento de la OAC durante dos años.
La aplicación del Título VI de la ley de Derechos Civiles de 1964 es una de las principales prioridades de la División de Derechos Civiles. Hay disponible más información sobre la División de Derechos Civiles en su sitio web en https://www.justice.gov/crt-espanol, y la información sobre el dominio limitado del inglés y el Título VI está disponible en www.lep.gov/SPA. Los miembros del público pueden reportar posibles violaciones de los derechos civiles en https://civilrights.justice.gov/report/.
Attorney General Merrick B. Garland Announces Monty Wilkinson as Director of the Executive Office for U.S. AttorneysRead the Press Release
Attorney General Merrick B. Garland today announced that former acting Attorney General Monty Wilkinson has been appointed as the Director of the Executive Office for U.S. Attorneys (EOUSA). Wilkinson previously served as the Director of EOUSA from 2014 until December 2017, and prior to that as its Principal Deputy Director and Chief of Staff.
During his career with the Department of Justice, Mr. Wilkinson has served as Counselor and Deputy Chief of Staff to the Attorney General, as an Associate Deputy Attorney General, and as the Deputy Assistant Attorney General for Human Resources and Administration. He also held senior management positions for nearly a decade in the U.S. Attorney’s Office for the District of Columbia. Mr. Wilkinson started his career at the Department of Justice as a trial attorney in the Criminal Division.
Norman Wong, who has been serving as the Acting Director of EOUSA since January 20, 2021, will return to his position as Principal Deputy Director. “Norm Wong has served at EOUSA with distinction for a number of years and provided exemplary leadership to the U.S. Attorney’s Offices as Acting Director over the past seven weeks,” said Attorney General Garland. “Norm’s commitment to public service is exceptional and I thank him for his service.”
“I look forward to working with Monty again as I did 25 years ago when I was the Principal Associate Deputy Attorney General,” said Attorney General Garland. “Monty ensured that the Department continued to work and to honor its proud traditions during the leadership transition between new administrations. The Department is fortunate to have Monty back at EOUSA and I am confident he will help continue to build upon our many successes in enforcing our country’s laws, bringing criminals to justice and ensuring equal justice under the law.”
Learn more about EOUSA at https://www.justice.gov/usao.
Justice Department Files Civil Action to Shut Down Mississippi Tax Return PreparerRead the Press Release
The United States has filed a complaint in the U.S. District Court for the Northern District of Mississippi seeking to bar a Senatobia, Mississippi, tax return preparer from preparing federal income tax returns for others.
The civil complaint was filed against Kathy R. Moton and alleges that she owns and operates defendant K&M Tax Essentials LLC. According to the complaint, Moton and K&M Tax Essentials prepared and filed hundreds of tax returns from 2018 through 2020. The complaint alleges that defendants prepared returns that claimed false American Opportunity Tax Credits, which provide a tax credit for tuition and expenses for an undergraduate or other recognized education credential. The complaint further alleges that defendants submitted forms to the IRS falsely attesting that they confirmed the taxpayer’s eligibility for the credits, but concealed the fraudulent claims from their customers by omitting forms from the copies of returns provided to those customers. According to the complaint, defendants’ practices resulted in a loss to the IRS of over $1 million.
Acting Assistant Attorney General David A. Hubbert of the Justice Department’s Tax Division made the announcement.
Return preparer fraud is one of the IRS’ Dirty Dozen Tax Scams and taxpayers seeking a return preparer should remain vigilant. (More information can also be found here.) The IRS has information on its website for choosing a tax preparer, has launched a free directory of federal tax preparers, and offers information on how to avoid “ghost” tax preparers, whose refusal to sign a return should be a red flag to taxpayers. The IRS also has a list of important reminders for taxpayers who are about to file their 2020 tax returns, including how to prepare for a smooth filing process.
In addition, IRS Free File, a public-private partnership, offers free online tax preparation and filing options on IRS partner websites for individuals whose adjusted gross income is under $72,000. For individuals whose income is over that threshold, IRS Free File offers electronic federal tax forms that can be filled out and filed online for free.
In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.
Justice Department Files Civil Action to Shut Down California Tax Return PreparerRead the Press Release
The United States has filed a complaint in the U.S. District Court for the Eastern District of California seeking to bar a Visalia, California tax return preparer from owning or operating a tax return preparation business and preparing federal income tax returns for others.
The civil complaint was filed against Esther Oregon both individually and doing business as “Mex Tax Service,” which the complaint alleges is a sole proprietorship. The complaint alleges Oregon and Mex Tax Service prepared federal income tax returns for taxpayers that underreported their customers’ federal tax liabilities for the 2017 and 2018 tax years by including, among other things, inflated or false claims for tax credits, itemized deductions, and income or business expense deductions.
According to the complaint, defendants prepared over 3,600 tax returns in aggregate for tax years 2017 and 2018. The complaint alleges that the IRS interviewed certain customers of Oregon and/or Mex Tax Service about their 2017 and 2018 tax returns and calculated, based on those interviews, an average underreporting of $4,120 per return in 2017 and $2,714 per return in 2018. According to the complaint, the estimated total direct harm to the Treasury, based on those calculations, exceeds $6.9 million.
Acting Assistant Attorney General David A. Hubbert of the Justice Department’s Tax Division made the announcement.
Return preparer fraud is one of the IRS’ Dirty Dozen Tax Scams and taxpayers seeking a return preparer should remain vigilant. (More information can also be found here.) The IRS has information on its website for choosing a tax preparer, has launched a free directory of federal tax preparers, and offers information on how to avoid “ghost” tax preparers, whose refusal to sign a return should be a red flag to taxpayers. The IRS also has a list of important reminders for taxpayers who are about to file their 2020 tax returns, including how to prepare for a smooth filing process.
In addition, IRS Free File, a public-private partnership, offers free online tax preparation and filing options on IRS partner websites for individuals whose adjusted gross income is under $72,000. For individuals whose income is over that threshold, IRS Free File offers electronical federal tax forms that can be filled out and filed online for free.
In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.
Former Correctional Officer Pleads Guilty to Role in Bribery and Drug Smuggling ConspiracyRead the Press Release
A North Carolina man pleaded guilty today to smuggling drugs and other contraband into Caledonia Correctional Institution in exchange for bribe payments.
According to court documents, Kenneth Farr, 47, of Rocky Mount, worked as a correctional officer at Caledonia Correctional Institution, a state prison in Halifax County. On at least six occasions in 2018, Farr used his position to smuggle contraband, including marijuana, tobacco, and what he believed to be oxycodone pills, to inmates in the prison. In exchange for smuggling the contraband, Farr received payments ranging from $300 to $500 in cash or via a mobile application and pocketed at least $2,200 from inmates and their associates.
Farr pleaded guilty to one count of conspiracy to use a facility in interstate commerce in furtherance of unlawful activity. He is scheduled to be sentenced in mid-June and faces a maximum of five years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Acting Assistant Attorney General Nicholas L. McQuaid of the Justice Department’s Criminal Division and Special Agent in Charge Robert R. Wells of the FBI’s Charlotte Field Office made the announcement.
The FBI is investigating the case, with significant assistance from the North Carolina Department of Public Safety.
Trial Attorneys Rebecca M. Schuman and Lauren E. Britsch of the Criminal Division’s Public Integrity Section are prosecuting the case.
Foreign Nationals Sentenced for Roles in Transnational Cybercrime EnterpriseRead the Press Release
Two foreign nationals — one Russian, the other Macedonian — were sentenced today for their role in the Infraud Organization, a transnational cybercrime enterprise engaged in the mass acquisition and sale of fraud-related goods and services, including stolen identities, compromised credit card data, computer malware, and other contraband.
Sergey Medvedev, aka “Stells,” “segmed,” and “serjbear,” 33, of Russia, pleaded guilty in the District of Nevada to one count of racketeering conspiracy in June 2020 and was sentenced today to 10 years in prison. According to court documents, Medvedev was a co-founder of Infraud along with Syvatoslav Bondarenko of Ukraine. From November 2010 until Infraud was taken down by law enforcement in February 2018, Medvedev was an active participant in the Infraud online forum, operating an “escrow” service to facilitate illegal transactions among Infraud members. For several years, Medvedev served as Infraud’s administrator, handling day-to-day management, deciding membership, and meting out discipline to those who violated the enterprise’s rules.
Marko Leopard, aka “Leopardmk,” 31, of North Macedonia, pleaded guilty in the District of Nevada to one count of racketeering conspiracy in November 2019 and was sentenced today to five years in prison. According to court documents, Leopard joined Infraud in June 2011, offering his services as an “abuse immunity” web hoster to Infraud members who wished to create websites to sell contraband. Unlike a legitimate host, Leopard would knowingly cater to websites offering illegal goods and services, ignoring any abuse reports from internet users. He hosted a number of sites for Infraud members in this fashion, providing the infrastructure that allowed his co-conspirators to profit off of their criminal activities.
“Dismantling a cybercrime organization like Infraud requires aggressive pursuit of not only those who steal, sell, and use personal data, but also those who provide the infrastructure that allows cybercrime organizations to operate,” said Acting Assistant Attorney General Nicholas L. McQuaid of the Justice Department’s Criminal Division. “Today’s sentences should serve as a warning to any web host who willingly looks the other way for a quick buck — and that the United States will hold these bad actors accountable, even when they operate behind a computer screen halfway across the world.”
“While criminal operators lurk in the deepest corners of the internet, they ultimately do not escape the reach of law enforcement,” said Special Agent in Charge Francisco Burrola of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) Las Vegas. “We will continue to aggressively investigate, disrupt, and dismantle hidden illegal networks that pose a threat in cyberspace. HSI and our partners are at the forefront of combating cyber financial crimes and illicit activities spread by online criminals looking for financial gain.”
Infraud was a criminal enterprise that existed to enrich its members and associates through a myriad of criminal acts of identity theft and financial fraud. Infraud facilitated the sale of contraband by its members, including counterfeit documents, stolen bank account and credit account information, and stolen personal identifying information. Members and associates of Infraud operated throughout the world and the United States, to include Las Vegas. The enterprise, which boasted over 10,000 members at its peak and operated for more than seven years under the slogan “In Fraud We Trust,” is among the largest ever prosecuted by the Department of Justice.
Infraud was responsible for the sale and/or purchase of over 4 million compromised credit and debit card numbers. The actual loss associated with Infraud was in excess of $568 million USD.
HSI Las Vegas and the Police Department of Henderson, Nevada, investigated the case. The Justice Department’s Office of International Affairs provided significant assistance in securing the defendant’s extradition from Croatia.
Deputy Chief Kelly Pearson and Trial Attorneys Chad McHenry and Alexander Gottfried of the Justice Department’s Organized Crime and Gang Section prosecuted the case.
Florida Return Preparers Charged with Defrauding the IRSRead the Press Release
A federal grand jury in Fort Lauderdale returned an indictment on Tuesday, March 16, 2021, charging two tax preparers with conspiring to defraud the United States and preparing false tax returns. The defendants made their initial court appearance before U.S. Magistrate Judge Patrick M. Hunt today.
According to the indictment, Nikency Alexis owned and operated Unity Tax & Financial Services, a return preparation business in Broward County. From 2011 through at least 2016, Alexis and Thony Guillaume, a return preparer at Unity Tax, allegedly conspired to defraud the IRS by preparing returns for clients that fraudulently increased their clients’ tax refunds. The returns allegedly falsely claimed business and education expenses that the clients did not in fact incur. The indictment also charges that Alexis made false statements on his own personal income tax returns.
If convicted, each defendant faces a maximum sentence of five years in prison on the conspiracy charge and three years in prison on each count of preparing false tax returns for their clients. Alexis also faces a maximum sentence of three years in prison on each count related to his own false tax returns. In addition, the defendants face a period of supervised release, restitution, and monetary penalties. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and U.S. Attorney Ariana Fajardo Orshan of the Southern District of Florida made the announcement.
Special agents of IRS-Criminal Investigation are investigating the case.
Trial Attorney Lauren Archer of the Tax Division and Assistant U.S. Attorney Deric Zacca are prosecuting the case.
An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
United States Reaches Proposed Settlement with Ranch Owner to Restore Creek and Wetlands and Pay Damages for TrespassRead the Press Release
The U.S. Department of Justice, U.S. Environmental Protection Agency (EPA) and Bureau of Land Management (BLM) announced that they have reached a proposed settlement with John Raftopoulos, Diamond Peak Cattle Company LLC and Rancho Greco Limited LLC (collectively, the defendants) to resolve violations of the Clean Water Act (CWA) and the Federal Land Policy and Management Act (FLPMA) involving unauthorized discharges of dredged or fill material into waters of the United States and trespass on federal public lands in northwest Moffat County, Colorado.
On Oct. 22, 2020, the United States filed suit in federal district court alleging that beginning in approximately 2012, and as recently as approximately 2015, the defendants discharged dredged or fill material into Vermillion Creek and its adjacent wetlands in order to route the creek into a new channel, facilitate agricultural activities and construct a bridge. These alleged unauthorized activities occurred on private land owned by the defendants and on public land managed by BLM, constituting a trespass in violation of the FLPMA. Vermillion Creek and its adjacent wetlands are waters of the United States and may not be filled without a CWA Section 404 permit from the U.S. Army Corps of Engineers (Corps), which was not obtained. EPA develops and interprets the policy, guidance and environmental criteria the Corps uses in evaluating permit applications.
“This proposed settlement will result in restoration of important waters in the arid west, deter future similar violations of the Clean Water Act and help ensure accountability and a level playing field,” said Acting Assistant Attorney General Jean E. Williams for the Justice Department’s Environment and Natural Resources Division.
“The U.S. Attorney’s Office and Department of Justice will take all necessary steps to protect our precious waters, wetlands, and wildlife,” said Acting United States Attorney Matt T. Kirsch for the District of Colorado. “Western rivers are a treasure and require protection from all threats, including damage to their vital creeks, streams, and tributaries.”
“Unauthorized dredging and filling of waters of the U.S. will not be tolerated,” said Acting Assistant Administrator Larry Starfield for the EPA’s Office of Enforcement and Compliance Assurance. “With this action, EPA is ensuring the proper restoration of vital creek and wetland resources.”
“This proposed settlement will allow the public lands impacted to begin the process of recovery for the future use and benefit of all the public,” said BLM Colorado State Director Jamie Connell.
The United States’ lawsuit further contended that the defendants’ alleged trespass also included unauthorized irrigation, removal of minerals and destruction of numerous cottonwood trees on federal public land. The fill and related activities on BLM lands were conducted without BLM authorization. The defendants’ trespass actions not only interfered with the public’s right to current enjoyment of federal public lands, but also jeopardized the future health and maintenance of these lands for use by all.
Under a proposed settlement filed in the U.S. District Court for the District of Colorado to resolve the lawsuit, the defendants agreed to: pay a $265,000 civil penalty for CWA violations; pay $78,194 in damages and up to $20,000 in future oversight costs for trespass on public lands managed by BLM; remove the unauthorized bridge constructed on public lands; restore approximately 1.5 miles of Vermillion Creek to its location prior to defendants’ unauthorized construction activities; restore the 8.47 acres of wetlands impacted adjacent to the creek; and plant dozens of cottonwood trees to replace those previously removed from federal lands. Additionally, under the terms of the proposed settlement, the defendants will place a deed restriction on their property to protect the restored creek and wetlands in perpetuity.
This proposed settlement will repair important environmental resources damaged by the defendants. The portions of Vermillion Creek and its adjacent wetlands impacted by the defendants’ unauthorized activities provided aquatic and wildlife habitat, runoff conveyance and groundwater recharge. The straightening of Vermillion Creek contributed to erosion of the bed and banks of the stream and detrimental sediment deposition downstream of the channelization. Browns Park National Wildlife Refuge, which provides important habitat for the endangered Colorado pikeminnow, is located at the confluence of Vermillion Creek and the Green River, approximately one mile downstream from the impacted area. Similarly, the destruction of numerous cottonwood trees located adjacent to the creek eliminated nesting, perching, and roosting habitat for raptor species, including bald eagle, golden eagle and red-tailed hawk. Cottonwood galleries with riparian vegetation also provide nesting habitat for a variety of migratory birds.
The proposed settlement, which is subject to a 30-day public comment period and final court approval, is available for review at: https://www.justice.gov/enrd/consent-decrees
For more information on the Clean Water Act, visit EPA's compliance web page: http://www.epa.gov/compliance. Help EPA protect our nation's land, air, and water by reporting violations: http://www.epa.gov/tips/
For more information on Section 404 of the Clean Water Act please visit: https://www.epa.gov/cwa-404/permit-program-under-cwa-section-404.
Louisiana Man Indicted for Attempted Murder of a Gay Man and Plot to Kidnap and Murder Other Gay MenRead the Press Release
A Louisiana man was indicted and charged today in federal court in the Western District of Louisiana on six counts, including hate crime, kidnapping, firearm and obstruction charges.
Chance Seneca, 19, of Lafayette, was charged by a federal grand jury on March 18 based on his attempted murder of a gay man and his overarching scheme to kidnap and murder gay men whom he met online.
The indictment alleges that on June 19 and 20, 2020, Seneca attempted to kidnap one man and successfully kidnapped two other men through his use of Grindr, a dating application for gay and bisexual men. The indictment further alleges that the defendant attempted to murder one of these men because of his gender and sexual orientation, and that the defendant intended to dismember and keep parts of the victim’s body as trophies, mementos and food. The indictment further alleges that the defendant possessed a firearm in furtherance of the hate crime, and that he tried to cover up his actions by deleting communications between himself and the victim of the attempted murder.
The statutory maximum for the hate crime, kidnapping and firearm offenses is life imprisonment. The statutory maximum for the attempted kidnapping and obstruction offenses is 20 years. The statutory minimum for the gun charge is five years.
The indictment was announced today by Acting U.S. Attorney Alexander C. Van Hook for the Western District of Louisiana, Principal Deputy Assistant Attorney General Pam Karlan of the Justice Department’s Civil Rights Division and FBI New Orleans Special Agent in Charge Bryan Vorndran.
The FBI conducted the investigation. This case is being prosecuted by Assistant U.S. Attorney Robert Abendroth of the Western District of Louisiana and Trial Attorney Thomas Johnson of the Civil Rights Division.
An indictment is merely an accusation, and the defendant is presumed innocent unless proven guilty.
For more information and resources on the department’s efforts to combat hate crimes, visit www.justice.gov/hatecrimes.
Kroger Shooter Pleads Guilty to Federal Hate Crimes and Firearm OffensesRead the Press Release
A Kentucky man pleaded guilty today to federal hate crimes and firearm charges arising out of the racially motivated shootings of Black individuals at a grocery store.
Gregory A. Bush, 53, of Louisville, pleaded guilty to federal hate crime and firearm charges arising out of his racially motivated murder of two Black patrons at a Kroger grocery store, and his attempted murder of a third, on Oct. 24, 2018, in Jeffersontown, Kentucky. Bush previously pleaded guilty-but-mentally-ill to state charges for murder, attempted murder, and wanton endangerment arising out of the shooting, and was sentenced to a life term in state prison.
During the plea hearing in federal court, Bush admitted that on Oct. 24, 2018, he drove to a Kroger grocery store in Jeffersontown armed with a Smith & Wesson, model 411, .40-caliber pistol. In the store, Bush followed a Black man, who was shopping with his grandson, for the length of an aisle before pulling the gun from his waistband and shooting the victim in the back of the head. Bush then shot the victim several more times in the torso, killing him. Bush had no prior relationship with the victim and chose to shoot him because of the victim’s race. Bush then re-holstered his gun and calmly walked out of the store.
In the parking lot, Bush walked up to a Black woman, and shot her several times in the head and body, killing her. Bush had no prior relationship with this victim and chose to shoot her because of her race.
Seconds later, Bush encountered a Black man who was in lawful possession of a handgun. The third victim asked Bush what was going on, and Bush, without responding, began walking toward him with the gun drawn. The third victim fired at Bush, and Bush returned fire. After about a minute, Bush stopped shooting and walked away. Bush had no prior relationship with the third victim and chose to shoot at him because of his race. Bush next encountered a white man, who was legally armed with a firearm. Bush told him, “Don’t shoot me [and] I won’t shoot you. Whites don’t shoot whites.”
“Today’s guilty plea will ensure that a violent and disturbed man will never get another chance to target and terrorize the Black community,” said Principal Deputy Assistant Attorney General Pamela S. Karlan for the Civil Rights Division. “It won’t bring back two pillars of the Louisville community, whose tragic and senseless deaths we mourn, but we hope it sends the message that the Justice Department will work tirelessly to bring perpetrators of bias-motivated violence to justice.”
“The work of the Jeffersontown Police Department, FBI and ATF in responding to and thoroughly investigating this tragic event is commendable,” said Acting U.S. Attorney Michael A. Bennett for the Western District of Kentucky. “The outstanding effort of the federal prosecutors assigned to this case and the solid working relationship we have with our state counterparts in the Jefferson County Commonwealth’s Attorney’s Office were instrumental in bringing about this plea.”
“The senseless murder of two of our citizens because of their race has no place in our community. Hate cannot, and will not, win,” said FBI Louisville Special Agent in Charge Robert Brown. “Today’s guilty plea is just one example of the Justice Department's and the FBI’s commitment to protecting civil rights for all and vindicating the rights of violent crime victims.”
“In its mission to protect our nation, ATF stands committed to swiftly arresting those who create terror in our communities through violent acts of hate,” stated Special Agent in Charge R. Shawn Morrow of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) Louisville Field Division. “In this instance, two Louisville African-Americans were gunned down while shopping for groceries – merely due to the color of their skin. ATF will continue to work with our law enforcement partners to seek justice for the victims and families of violent hate crimes and we will work tirelessly to enforce laws to prevent these tragedies.”
Bush faces a maximum sentence of life imprisonment without the possibility of parole. Bush’s sentencing in federal court will be held on June 24, 2021.
This case was investigated by the FBI Louisville Office, the ATF Louisville Field Division and the Jeffersontown Police Department and was prosecuted by Special Litigation Counsel Christopher J. Perras of the Civil Rights Division, and Assistant U.S. Attorney Amanda Gregory of the Western District of Kentucky.
A Kentucky man pleaded guilty today to federal hate crimes and firearm charges arising out of the racially motivated shootings of Black individuals at a grocery store.
Gregory A. Bush, 53, of Louisville, pleaded guilty to federal hate crime and firearm charges arising out of his racially motivated murder of two Black patrons at a Kroger grocery store, and his attempted murder of a third, on Oct. 24, 2018, in Jeffersontown, Kentucky. Bush previously pleaded guilty-but-mentally-ill to state charges for murder, attempted murder, and wanton endangerment arising out of the shooting, and was sentenced to a life term in state prison.
During the plea hearing in federal court, Bush admitted that on Oct. 24, 2018, he drove to a Kroger grocery store in Jeffersontown armed with a Smith & Wesson, model 411, .40-caliber pistol. In the store, Bush followed a Black man, who was shopping with his grandson, for the length of an aisle before pulling the gun from his waistband and shooting the victim in the back of the head. Bush then shot the victim several more times in the torso, killing him. Bush had no prior relationship with the victim and chose to shoot him because of the victim’s race. Bush then re-holstered his gun and calmly walked out of the store.
In the parking lot, Bush walked up to a Black woman, and shot her several times in the head and body, killing her. Bush had no prior relationship with this victim and chose to shoot her because of her race.
Seconds later, Bush encountered a Black man who was in lawful possession of a handgun. The third victim asked Bush what was going on, and Bush, without responding, began walking toward him with the gun drawn. The third victim fired at Bush, and Bush returned fire. After about a minute, Bush stopped shooting and walked away. Bush had no prior relationship with the third victim and chose to shoot at him because of his race. Bush next encountered a white man, who was legally armed with a firearm. Bush told him, “Don’t shoot me [and] I won’t shoot you. Whites don’t shoot whites.”
“Today’s guilty plea will ensure that a violent and disturbed man will never get another chance to target and terrorize the Black community,” said Principal Deputy Assistant Attorney General Pamela S. Karlan for the Civil Rights Division. “It won’t bring back two pillars of the Louisville community, whose tragic and senseless deaths we mourn, but we hope it sends the message that the Justice Department will work tirelessly to bring perpetrators of bias-motivated violence to justice.”
“The work of the Jeffersontown Police Department, FBI and ATF in responding to and thoroughly investigating this tragic event is commendable,” said Acting U.S. Attorney Michael A. Bennett for the Western District of Kentucky. “The outstanding effort of the federal prosecutors assigned to this case and the solid working relationship we have with our state counterparts in the Jefferson County Commonwealth’s Attorney’s Office were instrumental in bringing about this plea.”
“The senseless murder of two of our citizens because of their race has no place in our community. Hate cannot, and will not, win,” said FBI Louisville Special Agent in Charge Robert Brown. “Today’s guilty plea is just one example of the Justice Department's and the FBI’s commitment to protecting civil rights for all and vindicating the rights of violent crime victims.”
“In its mission to protect our nation, ATF stands committed to swiftly arresting those who create terror in our communities through violent acts of hate,” stated Special Agent in Charge R. Shawn Morrow of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) Louisville Field Division. “In this instance, two Louisville African-Americans were gunned down while shopping for groceries – merely due to the color of their skin. ATF will continue to work with our law enforcement partners to seek justice for the victims and families of violent hate crimes and we will work tirelessly to enforce laws to prevent these tragedies.”
Bush faces a maximum sentence of life imprisonment without the possibility of parole. Bush’s sentencing in federal court will be held on June 24, 2021.
This case was investigated by the FBI Louisville Office, the ATF Louisville Field Division and the Jeffersontown Police Department and was prosecuted by Special Litigation Counsel Christopher J. Perras of the Civil Rights Division, and Assistant U.S. Attorney Amanda Gregory of the Western District of Kentucky.
Justice Department Seeks to Shut Down Fraudulent Chicago-Area Tax Return PreparerRead the Press Release
The United States has filed a complaint in the U.S. District Court for the Northern District of Illinois, Eastern Division, seeking to enjoin a tax preparer from South Chicago Heights, Illinois, from preparing federal income tax returns for others.
The civil complaint filed against Leannette Scott alleges that she prepares federal income tax returns on which she reports false sole-proprietorship business expenses and education credits. According to the complaint, the IRS interviewed 21 of Scott’s customers, 17 of whom allegedly stated that Scott included incorrect and false information on their 2018 income tax returns. The complaint alleges that the IRS determined that the returns of these 17 customers reflect an actual tax loss to the United States of $39,287.
The complaint further alleges that Scott prepared at least 562 income tax returns from 2016 to 2020, for tax years 2015 through 2019. According to the complaint, Scott’s fraudulent tax preparation activities have caused the United States to lose substantial tax revenue, undermined public confidence in the administration of the federal tax system, and caused harm to her customers by exposing them to statutory penalties for substantially underreporting and underpaying their tax liabilities.
Acting Assistant Attorney General David A. Hubbert of the Justice Department’s Tax Division made the announcement.
Return preparer fraud is one of the IRS’ Dirty Dozen Tax Scams and taxpayers seeking a return preparer should remain vigilant. (More information can also be found here.) The IRS has information on its website for choosing a tax preparer, has launched a free directory of federal tax preparers, and offers information on how to avoid “ghost” tax preparers, whose refusal to sign a return should be a red flag to taxpayers. The IRS also has a list of important reminders for taxpayers who are about to file their 2020 tax returns, including how to prepare for a smooth filing process.
In addition, IRS Free File, a public-private partnership, offers free online tax preparation and filing options on IRS partner websites for individuals whose adjusted gross income is under $72,000. For individuals whose income is over that threshold, IRS Free File offers electronic federal tax forms that can be filled out and filed online for free.
In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.
Fourth Circuit Upholds Jury Conviction in Foreign-Agent ProsecutionRead the Press Release
WASHINGTON – The U.S. Court of Appeals for the Fourth Circuit today upheld an Eastern District of Virginia jury verdict convicting a man of acting and conspiring to act as an agent of the Turkish government within the United States without disclosing that relationship to the U.S. government. The Fourth Circuit also vacated an order granting a new trial and remanded the case for further proceedings before the district court.
According to court records, Bijan Rafiekian, 69, of San Juan Capistrano, California, along with his alleged co-conspirator, Kamil Ekim Alptekin, 43, of Istanbul, a Turkish national with close ties to the highest levels of the Government of Turkey, were involved in a conspiracy to act covertly within the U.S. on instructions from the Turkish government. The plot included using the services of the Flynn Intel Group (FIG), a company founded by Rafiekian and retired General Michael T. Flynn, to publicly and privately influence U.S. politicians and public opinion against a Turkish national, Fethullah Gulen, who is an imam, writer and political figure living in the U.S. Since 2015, the Government of Turkey has filed multiple extradition requests for Gulen in an effort to convince the U.S. government to extradite Gulen to Turkey.
Assistant Attorney General for the Justice Department's National Security Division John C. Demers and Acting U.S. Attorney Raj Parekh for the Eastern District of Virginia issued the following statement with respect to the decision of the United States Court of Appeals for the Fourth Circuit in United States v. Rafiekian:
“A federal jury found Rafiekian guilty of acting as an undisclosed agent of Turkey and conspiring to do so. We are pleased the Fourth Circuit concluded that the jury’s verdict was amply supported by the evidence. The Court’s careful legal analysis confirmed the broad scope and importance of transparency requirements for individuals acting within the United States at the direction of foreign governments. This case is a reminder to those who act covertly within our country on behalf of a foreign power that they face criminal consequences for their conduct. The Department will continue to combat covert foreign influence operations using the Foreign Agents Registration Act and all the tools at its disposal.”
According to court documents, the purpose of the conspiracy was to use FIG to delegitimize Gulen in the eyes of the American public and U.S. politicians, with the goal of obtaining his extradition, which was meeting resistance at the U.S. Department of Justice. At the same time, the conspirators sought to conceal that the Government of Turkey was directing the work. However, not only was Rafiekian told by Alptekin that Turkish cabinet-level officials had approved the budget for the project, but Alptekin also told Rafiekian and Flynn during the project that he was providing the Turkish officials updates on the work. Rafiekian understood that Alptekin was relaying the Turkish officials’ directions on the work to Rafiekian, Flynn, and others at FIG. During a September 2016 meeting in New York City organized by Alptekin, Rafiekian personally met with Turkish officials and heard them express their desire for Gulen’s extradition, an objective he then pursued using FIG’s personnel and connections.
According to court records and evidence presented at trial, the scheme included using Alptekin’s Dutch shell company to act as FIG’s “client.” FIG was paid $600,000 in three installments from an account in Turkey in Alptekin’s name. After Alptekin made the payments to FIG, FIG kicked back 20% of the payments to Alptekin’s shell company.
Rafiekian was convicted on charges of acting as an undisclosed foreign agent and of criminal conspiracy to act as an undisclosed foreign agent and to make a materially false Foreign Agents Registration Act filing. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Assistant U.S. Attorney Aidan Taft Grano argued the case on appeal. Assistant U.S. Attorneys James P. Gillis and John T. Gibbs of the Eastern District of Virginia and Trial Attorney Evan N. Turgeon of the National Security Division's Counterintelligence and Export Control Section prosecuted the case at trial.
Florida Man Charged with Federal Hate CrimeRead the Press Release
A Florida man was charged with federal hate crime in Ocala for setting fire to a church.
Steven Shields, 24, of Dunnellon, was charged with setting fire to and damaging the Queen of Peace Catholic Church in Ocala by a federal grand jury in Orlando, who returned an indictment against him.
According to the indictment, Shields intentionally set fire to the Queen of Peace Catholic Church on July 11, 2020. The indictment alleges that he was motivated to set this fire due to the religious character of the church. Shields is charged with one count of intentional damage to religious property, a hate crime charge that falls under the Church Arson Prevention Act, and one count of using fire to commit a felony.
If convicted, Shields faces a maximum term of 20 years imprisonment for intentionally damaging religious property. Shields faces an additional mandatory minimum of 10 years for using fire to commit a felony. He also faces up to three years of supervised release, a $250,000 fine and restitution.
The FBI, the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), the Florida State Fire Marshal, the Florida Bureau of Fire and Arson Explosives Investigations, the Marion County Sheriff’s Office, the Marion County Fire and Rescue Department and the Ocala Police Department conducted the investigation.
Assistant U.S. Attorney Robert E. Bodnar Jr. of the Middle District of Florida and Trial Attorney Maura White of the Justice Department’s Civil Rights Division are prosecuting the case.
An indictment is merely an accusation and Shields is presumed innocent unless and until proven guilty beyond a reasonable doubt.
For more information and resources about the department’s work to combat hate crimes, visit www.justice.gov/hatecrimes.
ODNI, DOJ and DHS Release Unclassified Summary of Assessment on Domestic Violent ExtremismRead the Press Release
Note: An executive summary of the joint comprehensive report can be viewed
here.The Office of the Director of National Intelligence (ODNI), the Department of Justice (DOJ), and the Department of Homeland Security (DHS) today released an unclassified summary of the joint comprehensive threat assessment on domestic violent extremism. The unclassified summary is attached and will be available on DNI.gov later today.
The assessment was prepared under the auspices of the DNI, in consultation with DOJ and DHS, and drafted by the National Counterterrorism Center, the Federal Bureau of Investigation, and DHS with contributions from the Central Intelligence Agency and the Defense Intelligence Agency. All agencies involved are mindful of the duty to respect privacy, civil rights, and civil liberties and to act within the authorities granted to them as they seek to put together as complete an intelligence and analytic picture as is possible.
New Jersey Man Charged with Tax Evasion and Filing False ReturnsRead the Press Release
A federal grand jury in Newark, New Jersey, returned an indictment today charging a New Jersey man with tax evasion and filing false tax returns.
According to the indictment, from 2011 through 2014, Gabriel M. Ferrari, owner of Buses and Trucks Inc. (B&T) in Linden used B&T’s gross receipts to pay personal expenses, including gambling on horse races, and then did not disclose the diverted receipts to his return preparer or the IRS. To hide his income, Ferrari allegedly filed false business and personal tax returns with the IRS.
If convicted, Ferrari faces a maximum sentence of five years in prison for each count of tax evasion, and three years in prison for each false tax return charge. Ferrari also faces a period of supervised release, restitution and monetary penalties. A federal district court judge will determine a sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and Acting U.S. Attorney Rachael A. Honig for the District of New Jersey made the announcement.
The IRS-Criminal Investigation is investigating the case.
Trial Attorney Ann Marie Cherry of the Tax Division and Assistant U.S. Attorney Andrew Trombly of the U.S. Attorney’s Office for the District of New Jersey are prosecuting the case.
Man Sentenced to 55 Months in Prison for Violating Sanctions Against Senior Venezuelan LeadersRead the Press Release
WASHINGTON – A Florida man was sentenced today to 55 months in prison for his connection with a scheme to provide private charter flights to two prominent members of former Venezuelan President Nicolás Maduro’s inner circle. He will also pay $250,000 in fines and undergo two years of supervised release as part of the sentence.
Victor Mones Coro, 52, of Florida was convicted by a federal jury for his involvement in a scheme to provide private charter flights to two prominent members of Former Venezuelan President Nicolás Maduro’s inner circle: Former Venezuelan Vice President Tareck Zaidan El Aissami Maddah and his frontman, Samark Jose Lopez Bello. These flight services violated sanctions imposed by the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) pursuant to the Foreign Narcotics Kingpin Designation Act.
“Mones Coro used subterfuge and lies to provide illegal flight services to top Venezuelan leaders, which provided political support for the unlawful Maduro regime,” said Assistant Attorney General John C. Demers for the Justice Department’s National Security Division. “His actions undermined our national security and foreign policy, and their gravity is reflected in today’s sentence. Let this case serve as a warning to anyone else who risks the wellbeing of our nation for personal gain and profit.”
“Victor Mones Coro led a concerted, sustained multi-year scheme to provide millions of dollars’ worth of illicit flight services to Venezuelan leaders in direct contravention of our country’s sanctions regime and foreign policy,” said U.S. Attorney Audrey Strauss for the Southern District of New York. “Today’s sentence serves as a reminder that, together with our law enforcement partners, we will aggressively prosecute sanctions violators to protect our national security.”
“We take a great deal of pride in working alongside the US Attorney’s Office and the Department of the Treasury to ensure that the integrity and intent of U.S. sanctions is preserved both at home and abroad. HSI, through myriad authorities, conducts criminal investigations to maintain the viability of the American financial system and prevent its misuse by foreign corrupt officials and narcotics traffickers,” said Special Agent in Charge Peter C. Fitzhugh of the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HIS) New York Field Office. “Today, we are reminded of our steadfast commitment to holding those willing to violate such sanctions accountable. And to those who intend to circumvent our laws to gain power and further their corrupt practices through international crime, know you will be brought to justice.”
According to court documents, Mones Coro designed an elaborate criminal scheme to enrich himself and provide flight services to El Aissami and Lopez Bello, among other influential Venezuelans in Maduro’s inner circle, including the President of Venezuela’s Supreme Court, Maikel Moreno, who had also been previously sanctioned by OFAC. In spearheading this criminal scheme, Mones Coro used his U.S.-based company American Charter Services (“ACS”), its planes and its employees to fly Lopez Bello, El Aissami, and others around the world, including to foreign countries of strategic importance to the Maduro regime such as Russia and Turkey.
Mones Coro also provided flights in furtherance of Maduro’s May 2018 campaign for reelection, a corrupt campaign through which Maduro illegitimately maintained control of Venezuela. Between approximately February and May 2018, Mones Coro and ACS arranged between 20 to 25 domestic Venezuelan flights for the Maduro campaign. These flights transported people, campaign materials, and food, among other things, and were coordinated with associates of El Aissami and Lopez Bello.
To avoid detection, Mones Coro and his co-conspirators, including Joselit Ramírez Camacho, Venezuela’s current Superintendent of Cryptocurrencies, engaged in various forms of subterfuge. They used code names, falsified flight manifests and invoices, communicated over encrypted messaging applications, received cash flown into the U.S. from Venezuela, and accepted wire transfers from a front company tied to the sanctioned Venezuelan leaders. Mones Coro also tried to cover his tracks by directing one of his pilots to lie to law enforcement.
Mones Coro perpetrated these crimes at a time when the U.S. and its allies were engaged in the crucial undertaking of depriving Venezuela and its leadership of resources for its malign, undemocratic, and deadly activities—including its systematic and oftentimes fatal repression of activists, its subversion of Venezuelan democratic institutions, and its corrupt plundering of Venezuela’s natural resources. Maduro and others are charged with narco-terrorism and related crimes in a Superseding Indictment also pending before Judge Hellerstein. In a separate Superseding Indictment, El Aissami, Lopez Bello, and Ramírez Camacho are charged with sanctions violations based on their roles in the scheme with Mones Coro.
The U.S. Customs and Border Protection, and the DEA’s Special Operations Division Bilateral Investigations Unit, with assistance from the Counterintelligence and Export Control Section of the Department of Justice’s National Security Division and Office of Foreign Assets Control investigated the case.
Trial Attorney David Recker of the Justice Department’s Counterintelligence and Export Control Section, and Assistant U.S. Attorneys Same Adelsberg and Amanda Houle of the Southern District of New York prosecuted the case.
Justice Department Seeks to Shut Down Illinois Tax Return PreparerRead the Press Release
The United States has filed a complaint in the U.S. District Court for the Northern District of Illinois seeking to bar a Rockford-area tax return preparer from preparing federal income tax returns for others.
The civil complaint was filed against Gretchen Alvarez, aka Gretchen Trejo. The suit is also brought against defendant Sick Credit Repair Tax and Legal Services, which the complaint alleges is the name under which Alvarez sometimes does business. According to the complaint, Alvarez prepares federal income tax returns for Rockford-area taxpayers that significantly understate her customers’ tax liabilities by fabricating business losses. The suit also alleges that Alvarez fraudulently claimed that some of customers attended higher education institutions, when they did not, in order to fraudulently claim education credits on the returns she prepared.
In particular, the suit alleges that Alvarez fabricated money-losing “side businesses” to fraudulently reduce her customers’ legitimate taxable income. According to the complaint, the IRS has interviewed several of Alvarez’s customers, who allegedly stated that they did not operate the listed businesses or incur the business expenses reported on their returns, and did not give Alvarez any reason to believe that such businesses existed.
The complaint alleges that, by repeatedly understating her customers’ tax liabilities, Alvarez has caused the United States to lose substantial tax revenue. According to the complaint, the true scope of her activities is unknown because she does not sign the tax return as the paid preparer, nor does she provide her IRS-issued identification number on returns she prepares, as required by law.
Acting Assistant Attorney General David A. Hubbert of the Justice Department’s Tax Division made the announcement.
Return preparer fraud is one of the IRS’ Dirty Dozen Tax Scams and taxpayers seeking a return preparer should remain vigilant. (More information can also be found here.) The IRS has information on its website for choosing a tax preparer, has launched a free directory of federal tax preparers, and offers information on how to avoid “ghost” tax preparers, whose refusal to sign a return should be a red flag to taxpayers. The IRS also has a list of important reminders for taxpayers who are about to file their 2020 tax returns, including how to prepare for a smooth filing process.
In addition, IRS Free File, a public-private partnership, offers free online tax preparation and filing options on IRS partner websites for individuals whose adjusted gross income is under $72,000. For individuals whose income is over that threshold, IRS Free File offers electronic federal tax forms that can be filled out and filed online for free.
In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.
Former Construction Company Owner Indicted for Defrauding Federal Program Intended for Service-Disabled Veteran-Owned Small BusinessesRead the Press Release
Today, a federal grand jury in San Antonio, Texas, returned an indictment charging the former owner of several companies in the construction industry for his role in a long-running scheme to defraud the United States.
According to court documents, Michael Angelo Padron was charged with one count of conspiracy to commit wire fraud and to defraud the United States and eight counts of wire fraud. Padron, along with co-conspirators Michael Wibracht and Ruben Villarreal, allegedly conspired to defraud the United States in order to obtain valuable government contracts under programs administered by the U.S. Small Business Administration (SBA) for which neither his nor his co-conspirators’ companies were eligible. Villarreal and Wibracht pleaded guilty to the scheme on Nov. 20, 2020, and March 4, 2021, respectively. Wibracht pleaded guilty to one count of conspiracy to commit wire fraud and defraud the United States. Villarreal pleaded guilty to one count of conspiracy to defraud the United States.
“Today’s charges show the division’s commitment to holding individuals accountable when they cheat the government procurement process,” said Acting Assistant Attorney General Richard A. Powers of the Department of Justice’s Antitrust Division. “This conspiracy robbed contract opportunities from honest businesses run by those who were injured in the service to our country. With support from our law enforcement partners, the Antitrust Division will continue to prosecute those who cheat the system to gain taxpayer dollars.”
The indictment alleges that Padron, Wibracht, and Villarreal conspired to defraud the United States by interfering with the function of the SBA and fraudulently obtaining money from as early as 2004 continuing through at least 2017. As part of the scheme, Padron is charged with conspiring to install Villarreal, a service-disabled veteran, as the ostensible owner of a general construction company held out as a Service-Disabled Veteran-Owned Small Business (SDVOSB). However, Padron, along with his co-conspirator and business partner Wibracht, allegedly exercised disqualifying financial and operational control over the construction company. According to court documents, the conspirators concealed that control in order to secure over $250 million in government contracts that were “set aside” for SDVOSBs in order to benefit their larger, non-qualifying businesses. The SBA administers the SDVOSB program, which is designed to increase the number of government contracts awarded to small businesses owned and controlled by service-disabled veterans. To qualify as an SDVOSB, a company, among other things, must be owned and controlled by a service-disabled veteran.
“Scheming to fraudulently obtain federal funds that are meant to provide assistance to the nation’s small businesses is unacceptable,” said Inspector General Hannibal “Mike” Ware of the SBA. “OIG and its law enforcement partners will relentlessly pursue fraudsters and bring them to justice. I want to thank the Antitrust Division and our law enforcement partners for their dedication and pursuit of justice.”
“Today’s indictment represents the extraordinary efforts by the joint investigative agencies in upholding the integrity of our procurement process while protecting special business opportunities for our veterans who have so bravely served and sacrificed for our country,” said Special Agent in Charge Ray A. Rayos of the U.S. Army Criminal Investigation Command (CID) Major Procurement Fraud Unit, Southwest Fraud Field Office.
“It is imperative that contractors are above-board in their dealings with the government,” said Special Agent in Charge Jamie Willemin of the General Services Administration (GSA) Office of Inspector General (OIG), Southwest and Rocky Mountain Division. “GSA OIG is committed to working with our investigative partners and the Department of Justice to hold accountable those who fraudulently obtain contracts meant for legitimate small and disadvantaged businesses.”
“The VA OIG commends our law enforcement partners for bringing these additional charges to achieve justice in this case,” said Inspector General Michael J. Missal of the Department of Veterans Affairs (VA). “The VA OIG remains diligent in investigating all who commit fraud and seek to benefit improperly from programs that are meant for deserving veterans.”
“This outcome is a testament to the commitment of the Defense Criminal Investigative Service (DCIS) and our law enforcement partners in safeguarding the integrity of the DoD contracting process,” said Acting Special Agent-in-Charge Gregory P. Shilling of the DCIS Southwest Field Office. “DCIS will utilize all available resources to pursue allegations of fraud impacting DoD contracts, bringing to justice those who seek to enrich themselves through the exploitation of the Small Business Administration program designed to help SDVOSBs.”
For conspiracy to commit wire fraud and to defraud the United States, Padron faces a maximum penalty of five years in prison and a $250,000 fine. For each wire fraud count, Padron faces a maximum penalty of 20 years in prison and a $250,000. The maximum fine for an individual may be increased to twice the gain derived from the crime, or twice the loss suffered by victims of the crime, if either of those amounts is greater than the statutory maximum fine. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
The SBA OIG, U.S. Army CID Major Procurement Fraud Unit, GSA OIG, VA OIG, and DCIS are investigating the case, with assistance from the U.S. Attorney’s Office for the Western District of Texas and the Army Audit Agency.
The Antitrust Division’s Washington Criminal II Section is prosecuting the case. Special thanks are extended to Assistant U.S. Attorney William F. Lewis Jr. of the U.S. Attorney’s Office for the Western District of Texas.
Anyone with information in connection with this investigation is urged to call the Antitrust Division’s Washington Criminal II Section at 202-598-4000, or visit https://www.justice.gov/atr/contact/newcase.html.
In November 2019, the Department of Justice created the Procurement Collusion Strike Force, a joint law enforcement effort to combat antitrust crimes and related fraudulent schemes that impact procurement and grant and program funding at all levels of government — federal, state, and local. For more information, visit https://www.justice.gov/procurement-collusion-strike-force.
An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Joint Statement from the Departments of Justice and Homeland Security Assessing the Impact of Foreign Interference During the 2020 U.S. ElectionsRead the Press Release
Note: The joint report can be viewed here.WASHINGTON – The Department of Justice (DOJ) and the Department of Homeland Security (DHS), including the FBI and the Cybersecurity and Infrastructure Security Agency (CISA), released today key findings and recommendations from a joint report to the President issued last month on the impact of foreign governments and their agents on the security and integrity of the 2020 U.S. federal elections.
The Departments investigated multiple public claims that one or more foreign governments owned, directed or controlled election infrastructure used in the 2020 federal elections; implemented a scheme to manipulate election infrastructure; or tallied, changed or otherwise manipulated vote counts. The Departments found that those claims were not credible.
These conclusions are part of a classified report to the President prepared by DOJ and DHS pursuant to section 1(b) of Executive Order 13848, Imposing Certain Sanctions in the Event of Foreign Influence in a United States Election (the EO), issued on Sept. 12, 2018. Although the 1(b) report notes that Russian, Chinese, and Iranian government-affiliated actors materially impacted the security of certain networks during the 2020 federal elections, the Departments found no evidence that any foreign government-affiliated actor manipulated election results or otherwise compromised the integrity of the 2020 federal elections.
The 1(b) report relied on a classified assessment — prepared by the Office of the Director of National Intelligence (ODNI), pursuant to section 1(a) of the EO, about any information indicating that a foreign government acted with the intent or purpose of interfering in the 2020 U.S. federal elections. Whereas the 1(a) report discusses efforts to influence public perceptions and opinion, the scope of the 1(b) report only includes efforts to compromise the security or integrity of election infrastructure or infrastructure pertaining to political organizations, candidates or campaigns used in the 2020 U.S. federal elections. The 1(b) report does not discuss efforts to sway voters or influence opinion.
During the 2020 election cycle, federal, state, local, tribal, territorial, non-governmental and private sector partners nationwide worked together in unprecedented ways to combat foreign interference efforts and support election officials, political organizations, campaigns and candidates in safeguarding their infrastructure. The Departments remain committed to continuously strengthening the nation’s cybersecurity, critical infrastructure, supply chain risk management, public-private partnerships and public messaging to enhance the resiliency of our democratic institutions.
Department of Justice Issues Statement Regarding Decision in Skyworks v. CDCRead the Press Release
Brian M. Boynton, Acting Assistant Attorney General for the Civil Division of the Department of Justice, released the following statement:
"The CDC’s eviction moratorium—which Congress extended last December and the CDC later extended through March 31, 2021—protects many renters who cannot make their monthly payments due to job loss or health care expenses. By preventing people from becoming homeless or having to move into more-crowded housing, the moratorium helps to slow the spread of COVID-19.
The Department of Justice respectfully disagrees with the March 10 decision of the district court in Skyworks v. CDC concluding that the moratorium exceeds CDC’s statutory authority to protect public health. In the Department’s view, that decision conflicts with the text of the statute, Congress’s ratification of the moratorium, and the rulings of other courts.
In any event, the decision applies only to the particular plaintiffs in that case. It does not prohibit the application of the CDC’s eviction moratorium to other parties. For other landlords who rent to covered persons, the CDC’s eviction moratorium remains in effect."
Daughter of Prolific Mexican Cartel Leader Pleads Guilty to Criminal Violation of the Foreign Narcotics Kingpin Designation ActRead the Press Release
A dual U.S.-Mexican citizen pleaded guilty today to willfully engaging in financial dealings with Mexican companies that had been identified as Specially Designated Narcotics Traffickers by the U.S. Department of the Treasury, Office of Foreign Assets Control (OFAC).
According to court documents, Jessica Johanna Oseguera Gonzalez, 34, of Guadalajara, Mexico, violated the criminal penalties of the Foreign Narcotics Kingpin Designation Act (the Kingpin Act) by engaging in property transactions with six Mexican businesses that OFAC previously designated to be “specially designated narcotics traffickers.” These six businesses were so designated because they provided material support to the Mexican drug trafficking organization known as the Cartel Jalisco Nueva Generacion (CJNG), which was itself designated by OFAC in April 2015. Oseguera Gonzalez’s father, Nemesio Ruben Oseguera Cervantes, aka “El Mencho,” who is the leader of CJNG, and her uncle, Abigael Gonzalez Valencia, who is the leader of the Los Cuinis drug trafficking organization, were also sanctioned by OFAC in April 2015.
“The Kingpin Act is a critically important tool in the U.S. government’s unrelenting efforts to target foreign drug cartels that seek to flood American streets with illegal drugs,” said Acting Assistant Attorney General Nicholas L. McQuaid of the Justice Department’s Criminal Division. “The Department of Justice will aggressively investigate and criminally prosecute those who willfully violate Treasury Department sanctions under the Kingpin Act, as a key component of our broader whole-of-government strategy to dismantle and disrupt foreign drug cartels.”
“Today’s guilty plea is a result of our relentless commitment to disrupt and dismantle all aspects of the CJNG organization,” said Special Agent in Charge Bill Bodner of the Drug Enforcement Administration’s (DEA) Los Angeles Field Division. “Our efforts will continue to include a focus on those who facilitate these illicit drug networks. Together with the Department of Justice, we will use all the investigative tools available, including OFAC designations, to bring to justice those who engage in illegal activity that is fueling the drug crisis nationwide.”
Court documents indicate that Oseguera Gonzalez was an owner of two Mexican companies designated by OFAC, J&P Advertising S.A. de C.V., and JJGON S.P.R. de R.L. de C.V., and that she was an officer, director, or agent of four additional sanctioned businesses, Las Flores Cabanas, Mizu Sushi Lounge, Tequila Onze Black, and Operadora Los Famosos S.A. de C.V., doing business as Kenzo Sushi. She remained an owner, officer, director, or agent of those entities following their OFAC designations, and did not seek the required license from OFAC to engage in those financial transactions.
Oseguera Gonzalez pleaded guilty to willfully violating the Kingpin Act’s prohibitions on engaging in transactions or dealings in property with entities or persons sanctioned under the Kingpin Act, and to being an officer, director, or agent of entities who knowingly participated in Kingpin Act violations. She is scheduled to be sentenced on June 11 and faces a maximum penalty of up to 30 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
The DEA’s Los Angeles Field Division is investigating the case, and the Justice Department particularly thanks the Office of Foreign Assets Control of the Department of the Treasury for its support. The Justice Department’s Office of International Affairs provided investigative assistance.
Trial Attorneys Brett Reynolds, Kaitlin Sahni, and Kate Naseef of the Justice Department’s Narcotic and Dangerous Drug Section are prosecuting the case.
This case received significant support from the Organized Crime Drug Enforcement Task Force (OCDETF) program. The OCDETF program supports investigations around the country to identify, disrupt, dismantle and prosecute high-level members of drug trafficking, weapons trafficking, and money laundering organizations and enterprises.
Two Former Louisiana Supervisory Correctional Officers Sentenced for Civil Rights Offense Arising Out of the Death of an InmateRead the Press Release
Two Louisiana men, former jail supervisors, were sentenced today to five years in prison and over four years in prison respectively for being deliberately indifferent to an inmate’s serious medical needs.
As a result of this civil rights offense, 19-year-old Nimali Henry died in the custody of the St. Bernard Parish Prison (SBPP) on April 1, 2014. Henry died after she failed to receive medical treatment for her rare blood disorder and other medical conditions during the ten days she was incarcerated.
Former SBPP Captain Andre Dominick, 61, of New Orleans, was sentenced to five years in prison. Dominick previously pleaded guilty to violating Henry’s civil rights under color of law. In pleading guilty, Dominick admitted that he knew that Henry had serious medical needs that required medication. Dominick acknowledged that he had reviewed Henry’s written request for help, in which she wrote that, if she did not continue the medical treatment her doctor had prescribed, there was a 90% chance she would die. Dominick also spoke with Henry about her medical condition; spoke with Henry’s social worker, who confirmed her medical needs; and observed Henry’s deteriorating physical condition while she was in jail. However, despite knowing Henry’s plight, Dominick – who was also acting as the medical officer during Henry’s incarceration – failed to take any reasonable steps to get her the medical attention she needed, as he was required to do under the law.
Former SBPP Corporal Timothy Williams, 41, of New Orleans, was sentenced to 57 months in prison. Williams also previously pleaded guilty to violating Henry’s civil rights under color of law. In his guilty plea, Williams admitted that he knew from his conversations with Henry and her fellow inmates that Henry had serious medical conditions that required medication. Williams also personally observed Henry as she grew sicker throughout her incarceration. However, Williams failed to take any reasonable steps to get Henry necessary medical care for her serious medical needs, as the law required him to do. In his factual basis, Williams further admitted that, rather than obtain medical care for Henry, he placed her in a holding cell, a placement typically reserved for misbehaving inmates, in order to discourage her from making future medical complaints. He also told Henry’s fellow inmates to stop requesting help on Henry’s behalf.
“Nimali Henry’s death was not the result of neglect or a lapse of judgment. Her death was the slow, painful, and completely preventable result of the deliberate choices made by these defendants, each of whom knew that he had the constitutional duty to provide necessary medical care for a young woman who was completely dependent on them for help while she was in their custody,” said Principal Deputy Assistant Attorney General Pamela S. Karlan for the Justice Department’s Civil Rights Division. “Prosecuting corrections officers who intentionally violate their constitutional responsibilities is a critical part of the Department’s mission.”
“The protection of all of our citizens’ civil rights is an essential part of our Constitution,” said U.S. Attorney Duane A. Evans for the Eastern District of Louisiana. “Violation of these entitlements, especially in this case by the correctional officers sworn to protect the rights of inmates, erodes public confidence in our correctional system. The public must be able to trust that correctional officers are fulfilling their duties honestly and are truthful during the course of federal investigations or face the consequences of their actions. Our office, along with the Department of Justice, the FBI, state and local law enforcement agencies will continue to investigate and prosecute any violations of our citizens' civil rights.”
“Captain Andre Dominick and Corporal Timothy Williams were responsible for the welfare of inmates at the St. Bernard Parish Prison.” said Special Agent in Charge Bryan A. Vorndran for the FBI New Orleans Field Office. “Correctional officers have a sworn duty to ensure that inmates are protected, rather than abused or neglected. Their actions are a disgrace to all correctional officers who serve ethically and continue to maintain high moral standards throughout our correctional facilities. Because of the choices each defendant made, Nimali Henry failed to get the care and attention that she needed to address her known medical conditions, ultimately resulting in her death. The FBI New Orleans Field Office is appreciative of its partnerships with the Department of Justice’s Civil Rights Division and U.S. Attorney’s Office of the Eastern District of Louisiana and we remain committed to protecting the rights of all Americans, to include those incarcerated.”
On March 10, two former SBBP Deputies, Lisa Vaccarella and Debra Becnel, were sentenced for their roles in covering up the circumstances of Henry’s death.
This case was investigated by the FBI and was prosecuted jointly by Trial Attorney Christine M. Siscaretti of the Civil Rights Division and Assistant U.S. Attorneys Chandra Menon and Tracey N. Knight for the Eastern District of Louisiana.
Two Former Louisiana Correctional Officers Sentenced for Cover up Following Death of an InmateRead the Press Release
Two Louisiana women, former jail deputies, were sentenced today to over a year in prison and six months in prison respectively for their roles in covering up a civil rights violation arising out of an inmate’s death at the St. Bernard Parish Prison (SBPP).
On April 1, 2014, 19-year-old Nimali Henry died in custody after she failed to receive medical treatment for her rare blood disorder and other medical conditions during the ten days she was incarcerated there.
Former SBPP Deputy Lisa Vaccarella of New Orleans was sentenced to 21 months in prison with three years of supervised release for failing to take any affirmative steps to alert federal authorities that she knew that other officers had willfully violated Ms. Henry’s civil rights by depriving her of necessary medical treatment. Vaccarella was also sentenced for lying to FBI agents about her own observations of Ms. Henry. Specifically, Vaccarella admitted that she falsely told FBI agents that she saw Henry get up on her command, stand without help, and walk without any difficulty when, in fact, Vaccarella watched Henry fall to the floor and then, without offering Henry any assistance, closed the cell door, leaving Henry lying on the floor.
Former SBPP Deputy Debra Becnel of New Orleans was sentenced to six months in prison with three months to be served in custody followed by three months of home detention and three years of supervised release for lying to FBI agents during the federal investigation. In pleading guilty, Becnel admitted that she falsely told FBI agents that neither Henry nor the inmates talked to her about Henry’s medical needs, when, in fact, Henry and other inmates had told Becnel and other correctional officers that Henry was ill, needed medical treatment and might die if she did not get her medical treatment.
“When officers obstruct justice and lie during investigations, it threatens our ability to prosecute civil rights cases and erodes the public’s confidence in law enforcement itself," said Pamela S. Karlan, Principal Deputy Assistant Attorney General for the Civil Rights Division. "To ensure that justice prevails, the Department will continue to prosecute officers who lie to investigators and cover up crimes."
“The protection of all of our citizen’s civil rights is an essential part of our Constitution,” said U.S. Attorney Duane A. Evans for the Eastern District of Louisiana. “Violation of these entitlements, especially in this case by the correctional officers sworn to protect the rights of inmates, erodes public confidence in our correctional system. The public must be able to trust that correctional officers are fulfilling their duties honestly and are truthful during the course of federal investigations or face the consequences of their actions. Our office, along with the Department of Justice, the Federal Bureau of Investigation, state and local law enforcement agencies will continue to investigate and prosecute any violations of our citizen’s civil rights.”
"Along with our partners, the FBI will aggressively investigate allegations wherein correctional officers abuse their position of power and authority over prisoners to deny them their constitutional right to be free from cruel and unusual punishment," said Special Agent in Charge Bryan Vorndran for the FBI New Orleans Field Office. "Nimali Henry suffered incredible unusual punishment at the hands of Deputies Lisa Vaccarella and Debra Becnel. The two deputies willfully deprived Henry of the medical attention she desperately needed and lied to federal authorities to conceal their failure to act in a compassionate and humane manner, let alone honor the oath they swore to uphold. The law suffers the most when those in a position of trust abuse their power. The FBI New Orleans Field Office appreciates its partnerships with the trial attorneys from the Department of Justice’s Civil Rights Division and U.S. Attorney’s Office of the Eastern District of Louisiana.”
Former SBPP Captain Andre Dominick and former SBPP Corporal Timothy Williams are also due to be sentenced today for the role each played in Henry’s death. Dominick and Williams each have pleaded guilty to violating Henry’s civil rights under color of law by being deliberately indifferent to her serious medical needs.
This case was investigated by the FBI and was prosecuted jointly by Trial Attorney Christine M. Siscaretti of the Justice Department’s Civil Rights Division and Assistant United States Attorneys Chandra Menon and Tracey N. Knight of the U.S. Attorney’s Office for the Eastern District of Louisiana.
National Consumer Bankruptcy Law Firm Agrees to Pay More than $300,000 in Relief to Consumers and to a Six-Year Practice Ban in Settlement with U.S. Trustee ProgramRead the Press Release
The Department of Justice’s U.S. Trustee Program (USTP) has entered into a settlement with national consumer bankruptcy law firm Deighan Law LLC, previously known as Law Solutions Chicago and doing business as UpRight Law (UpRight). The settlement is set forth in a consent order entered by the Bankruptcy Court for the District of Montana on March 9 and resolves enforcement actions filed by the USTP over allegations of misconduct relating to UpRight’s representation of Montana consumers as debtors or prospective debtors in bankruptcy cases. As stipulated in the settlement, UpRight has paid or will pay more than $300,000 in monetary relief and will be barred from representing bankruptcy clients in Montana for six years.
As a result of dozens of USTP actions filed since 2016, UpRight has paid or been ordered to pay almost $900,000 in monetary relief, including returning fees to over 500 impacted consumers and paying court-ordered sanctions, attorney’s fees, and costs. Additionally, bankruptcy courts have imposed practice bans against UpRight in at least four jurisdictions.
“Lawyers who misrepresent their services to vulnerable clients and fail to perform as promised harm debtors, creditors, and the integrity of the bankruptcy system,” said USTP Director Cliff White. “This settlement shows that the USTP will continue to hold accountable attorneys who fail to adequately and honestly represent their clients.”
In the current matter, the USTP alleged that UpRight engaged in misconduct and misrepresentations impacting hundreds of Montana consumers, which came to light due to investigations by the USTP in two bankruptcy cases. In one case, UpRight substantially delayed filing its client’s bankruptcy case for almost a year after it misrepresented that it had a local attorney who was licensed in Montana available to file the case. UpRight’s delay resulted in a creditor garnishing more than $6,000 of the debtor’s wages. In the other case, UpRight obtained payment of its attorney’s fees by advising the debtors to participate in an improper scheme whereby they surrendered their vehicle to an out-of-state towing company. Another bankruptcy court previously sanctioned UpRight for implementing the towing program—which it used in more than 200 cases across the country—describing it as a “scam from the start,” and the towing company’s owners were indicted for their role in the scheme. UpRight’s advice resulted in the debtors being sued by their automobile lender for conversion of its collateral.
In the settlement, UpRight does not contest the USTP’s allegations that it engaged in misconduct in the course of its dealings with Montana consumers, including misrepresenting that it had a sufficient number of local Montana-licensed attorneys available to provide adequate bankruptcy representation, misrepresenting to clients the scope of legal services to be provided and the cost of those services, failing to timely provide its clients with written retainer agreements that clearly and conspicuously explained the legal services to be provided and the cost of those services, failing to discuss non-bankruptcy alternatives, failing to adequately supervise the firm’s non-attorney staff (some of whom engaged in the unauthorized practice of law), providing erroneous legal advice, and failing to adequately supervise its Montana “partner” attorneys. This misconduct contributed to UpRight’s substantial delay in filing bankruptcy cases for Montana consumers. In addition, UpRight filed bankruptcy cases for only 109 of the 473 Montana clients from whom the firm collected at least a partial fee.
To resolve the USTP’s allegations of misconduct, UpRight has refunded or will refund more than $300,000 in fees paid by Montana consumers for whom UpRight never filed a bankruptcy case. UpRight also agreed to pay a civil penalty of $10,309 and to return all fees, totaling $3,770, to the debtors in the two cases in which the USTP brought its enforcement actions. Additionally, UpRight will be barred from accepting bankruptcy clients or providing bankruptcy services to consumers in Montana, effective July 2, 2018, through July 2, 2024.
While the agreement resolves disputes with the USTP in the two underlying bankruptcy cases, it does not impact the rights of the debtors in those cases or any other parties or government agencies not participating in the settlement, including other Montana consumers, nor does it impact the USTP’s rights to litigate enforcement actions against UpRight in other jurisdictions or to seek redress in other Montana cases. The two underlying cases are captioned In re Dailey, Case No. 15-61088-7 (Bankr. D. Mont.), and In re Emerson, Case No. 16-60056-7 (Bankr. D. Mont.).
The U.S. Trustee Program is the component of the Justice Department that protects the integrity of the bankruptcy system by overseeing case administration and litigating to enforce the bankruptcy laws. The Program has 21 regions and 90 field office locations. Learn more information on the Program at: https://www.justice.gov/ust.