District Not Recorded
The source did not name an office we could identify. These records remain unassigned rather than guessed.
Federal Court Bars Florida Tax Return Preparer and Her Businesses from Preparing Tax ReturnsRead the Press Release
A federal court in Miami, Florida, permanently barred Georgina Gonzalez and GeorginagonzalezLLC, Ideal Tax Pros LLC, and Trinity Tax Service LLC, from preparing federal tax returns for others and owning or operating a tax preparation business, the Justice Department announced today. The court also ordered that Gonzalez and Trinity Tax Service LLC disgorge $48,214.30, representing the ill-gotten gains that they received for the preparation of tax returns making false claims.
The government’s complaint alleged that the defendants prepared tax returns that included fraudulent claims for the Earned Income Tax Credit (EITC) based on fabricated income or business expenses. The complaint further alleged that defendants prepared returns for some customers that reported bogus “Household Help” work income, and returns claiming phony business loss deductions so as to falsely maximize their customers’ claim to the EITC. The complaint also alleged that defendants falsely claimed education credits on the tax returns of customers who did not attend college and had no qualifying education expenses.
The court’s disgorgement determination is based on ill-gotten gains stemming from tax returns filed in 2018 that falsely claimed either “Household Help” income, self-employed business income or expenses, or the EITC.
Return preparer fraud is one of the IRS’ Dirty Dozen Tax Scams for 2019 and taxpayers seeking a return preparer should remain vigilant. The IRS has information on its website about selecting a return preparer and has launched a free directory of federal tax preparers.
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.
The Department of Justice and Department of Homeland Security Issue Third Country Asylum RuleRead the Press Release
Tomorrow, a joint Interim Final Rule (IFR) issued by the Departments of Justice and Homeland Security will publish in the Federal Register.
This IFR uses the authority delegated by Congress in section 208(b)(2)(C) of the Immigration and Nationality Act to enhance the integrity of the asylum process by placing further restrictions or limitations on eligibility for aliens who seek asylum in the United States. Specifically, the Departments of Justice and Homeland Security are revising 8 C.F.R. § 208.13(c) and 8 C.F.R. § 1208.13(c) to add a new bar to eligibility for asylum for an alien who enters or attempts to enter the United States across the southern border, but who did not apply for protection from persecution or torture where it was available in at least one third country outside the alien’s country of citizenship, nationality, or last lawful habitual residence through which he or she transited en route to the United States.
Attorney General William P. Barr issued the following statement:
“This Rule is a lawful exercise of authority provided by Congress to restrict eligibility for asylum. The United States is a generous country but is being completely overwhelmed by the burdens associated with apprehending and processing hundreds of thousands of aliens along the southern border. This Rule will decrease forum shopping by economic migrants and those who seek to exploit our asylum system to obtain entry to the United States—while ensuring that no one is removed from the United States who is more likely than not to be tortured or persecuted on account of a protected ground.”
The bar is subject to three limited exceptions, including:
(1) an alien who demonstrates that he or she applied for protection from persecution or torture in at least one of the countries through which the alien transited en route to the United States, and the alien received a final judgment denying the alien protection in such country;
(2) an alien who demonstrates that he or she satisfies the definition of “victim of a severe form of trafficking in persons” provided in 8 C.F.R. § 214.11; or,
(3) an alien who has transited en route to the United States through only a country or countries that were not parties to the 1951 Convention relating to the Status of Refugees, the 1967 Protocol, or the Convention against Torture and Other Cruel, Inhuman or Degrading Treatment or Punishment.
Asylum is a discretionary benefit offered by the United States Government to those fleeing persecution on account of race, religion, nationality, membership in a particular social group, or political opinion.
Department of Homeland Security Acting Secretary Kevin K. McAleenan issued the following statement:
"While the recent supplemental funding was absolutely vital to helping confront the crisis, the truth is that it will not be enough without targeted changes to the legal framework of our immigration system. Until Congress can act, this interim rule will help reduce a major 'pull' factor driving irregular migration to the United States and enable DHS and DOJ to more quickly and efficiently process cases originating from the southern border, leading to fewer individuals transiting through Mexico on a dangerous journey. Ultimately, today's action will reduce the overwhelming burdens on our domestic system caused by asylum-seekers failing to seek urgent protection in the first available country, economic migrants lacking a legitimate fear of persecution, and the transnational criminal organizations, traffickers, and smugglers exploiting our system for profits.”
The United States has experienced a dramatic increase in the number of aliens encountered along or near the southern land border with Mexico. This increase corresponds with a sharp increase in the number, and percentage, of aliens claiming fear of persecution or torture when apprehended or encountered by DHS. The number of cases referred to DOJ for proceedings before an immigration judge has also risen exponentially, more than tripling between 2013 and 2018. These numbers are projected to continue to increase throughout the remainder of Fiscal Year 2019 and beyond.
Only a small minority of these individuals, however, are ultimately granted asylum. The large number of meritless asylum claims places an extraordinary strain on the nation’s immigration system, undermines many of the humanitarian purposes of asylum, has exacerbated the humanitarian crisis of human smuggling, and adversely impacts the United States’ ongoing diplomatic negotiations with foreign countries. This rule mitigates the strain on the country’s immigration system by more efficiently identifying aliens who are misusing the asylum system to enter and remain in the United States rather than legitimately seeking urgent protection from persecution or torture.
The IFR is immediately effective upon publication and can be found here.
Michigan Defendant Pleads Guilty to Conspiracy to Defraud the IRS and Steal from an Organization Receiving Federal FundsRead the Press Release
A Boca Raton, Florida, resident pleaded guilty today in Flint, Michigan, to conspiring to impede the lawful functions of the Internal Revenue Service (IRS) and conspiring to steal from an organization receiving federal funds, announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division.
According to court documents, from January 2013 through December 2017, Scott Jawetz and his co-defendants executed a scheme, using the company Blue Horseshoe Consulting Inc. (Blue Horseshoe), to obtain police reports, stolen from the Detroit Police Department, which contained automobile crash victim information. Jawetz and his co-conspirators used the stolen information to solicit automobile accident victims for medical and chiropractic services. Jawetz and his co-conspirators also underreported to the IRS gross receipts they received from Blue Horseshoe business operations and the total wages Blue Horseshoe paid to its employees.
United States District Court Judge Matthew F. Leitman scheduled sentencing for Jawetz for Jan. 15, 2020. Jawetz faces a maximum sentence of five years in prison and a $250,000 fine on each of the two conspiracy counts. Jawetz also faces a period of supervised release, restitution, and monetary penalties.
Acting Deputy Assistant Attorney General Goldberg thanked special agents of IRS-Criminal Investigation and the Federal Bureau of Investigation, who conducted the investigation, and Tax Division Trial Attorneys Mark McDonald and William Guappone, who are prosecuting the case.
Additional information about the Tax Division’s enforcement efforts can be found on the division’s website.
Justice Department Obtains $1.4 Billion from Reckitt Benckiser Group in Largest Recovery in a Case Concerning an Opioid Drug in United States HistoryRead the Press Release
Global consumer goods conglomerate Reckitt Benckiser Group plc (RB Group) has agreed to pay $1.4 billion to resolve its potential criminal and civil liability related to a federal investigation of the marketing of the opioid addiction treatment drug Suboxone. The resolution – the largest recovery by the United States in a case concerning an opioid drug – includes the forfeiture of proceeds totaling $647 million, civil settlements with the federal government and the states totaling $700 million, and an administrative resolution with the Federal Trade Commission for $50 million.
Suboxone is a drug product approved for use by recovering opioid addicts to avoid or reduce withdrawal symptoms while they undergo treatment. Suboxone and its active ingredient, buprenorphine, are powerful and addictive opioids.
“The opioid epidemic continues to be a serious crisis for our nation, and I’m proud of the work the Department of Justice and our partners are doing to address this epidemic,” said Principal Deputy Associate Attorney General Claire Murray.
“We are confronting the deadliest drug crisis in our nation’s history. Opioid withdrawal is difficult, painful, and sometimes dangerous; people struggling to overcome addiction face challenges that can often seem insurmountable,” said Assistant Attorney General Jody Hunt for the Department of Justice’s Civil Division. “Drug manufacturers marketing products to help opioid addicts are expected to do so honestly and responsibly.”
Resolution of the Criminal Investigation
Until December 2014, RB Group’s wholly owned subsidiary, Indivior Inc. (then known as Reckitt Benckiser Pharmaceuticals Inc.) marketed and sold Suboxone throughout the United States. In December 2014, RB Group spun off Indivior Inc., and the two companies are no longer affiliated. On April 9, a federal grand jury sitting in Abingdon, Virginia, indicted Indivior for allegedly engaging in an illicit nationwide scheme to increase prescriptions of Suboxone. The United States’ criminal trial against Indivior is scheduled to begin on May 11, 2020, in the United States District Court in Abingdon, Virginia. Indivior is presumed innocent until proven guilty.
To resolve its potential criminal liability stemming from the conduct alleged in the indictment of Indivior, RB Group has executed a non-prosecution agreement that requires the company to forfeit $647 million of proceeds it received from Indivior and not to manufacture, market, or sell Schedule I, II, or III controlled substances in the United States for three years. In addition, RB Group has agreed to cooperate fully with all investigations and prosecutions by the Department of Justice related, in any way, to Suboxone.
“Today’s announcement demonstrates that this office will work tirelessly to address all facets of the opioid epidemic,” First Assistant United States Attorney Daniel P. Bubar of the Western District of Virginia said. “This historic resolution is the product of a continued partnership with the Virginia Medicaid Fraud Control Unit, FDA, HHS, and the U.S. Postal Service.”
“This is a landmark moment in our fight to hold drug companies responsible for their role in the opioid crisis,” said Virginia Attorney General Mark Herring. “We will not allow anyone to put profits over people, or to exacerbate or exploit the opioid crisis for their own benefit. The Virginia Medicaid Fraud Control Unit’s expertise, capacity, and diligent investigation, combined with strong relationships with local, state, and federal partners, helped make this resolution possible.”
“Opioid addiction and abuse is an immense public health crisis and taking steps to address it is one the FDA’s highest priorities,” said Acting FDA Commissioner Ned Sharpless, M.D. “Providing misleading information about product benefits puts the public at risk. We also are particularly concerned with schemes to game the drug approval process to prevent generic competition for important medicines. The FDA, including criminal investigators in our Office of Regulatory Affairs and the lawyers in our Office of Chief Counsel, will continue to work with the Department of Justice to investigate and hold accountable those who devise and participate in schemes to the detriment of the public health.”
“The U.S. Postal Service spends billions of dollars per year in workers compensation-related costs, most of which are legitimate,” said Kenneth Cleevely, Special Agent in Charge of the Eastern Field Office for the U.S. Postal Service Office of Inspector General. “However, when medical providers or companies choose to flout the rules and profit illegally, special agents with the USPS OIG will work with our law enforcement partners to hold them responsible. To report fraud or other criminal activity involving the Postal Service, contact our special agents at www.uspsoig.gov or 888-USPS-OIG.”
According to the indictment, Indivior—including during the time when it was a subsidiary of RB Group—promoted the film version of Suboxone (Suboxone Film) to physicians, pharmacists, Medicaid administrators, and others across the country as less-divertible and less-abusable and safer around children, families, and communities than other buprenorphine drugs, even though such claims have never been established.
The indictment further alleges that Indivior touted its “Here to Help” internet and telephone program as a resource for opioid-addicted patients. Instead, however, Indivior used the program, in part, to connect patients to doctors it knew were prescribing Suboxone and other opioids to more patients than allowed by federal law, at high doses, and in a careless and clinically unwarranted manner.
The indictment also alleges that, to further its scheme, Indivior announced a “discontinuance” of its tablet form of Suboxone based on supposed “concerns regarding pediatric exposure” to tablets, despite Indivior executives’ knowledge that the primary reason for the discontinuance was to delay the Food and Drug Administration’s approval of generic tablet forms of the drug.
The indictment alleges Indivior’s scheme was highly successful, fraudulently converting thousands of opioid-addicted patients over to Suboxone Film and causing state Medicaid programs to expand and maintain coverage of Suboxone Film at substantial cost to the government.
The Civil Settlement
Under the civil settlement, RB Group has agreed to pay a total of $700 million to resolve claims that the marketing of Suboxone caused false claims to be submitted to government health care programs. The $700 million settlement amount includes $500 million to the federal government and up to $200 million to states that opt to participate in the agreement. The claims settled by the civil agreement are allegations only and there has been no determination of liability.
The civil settlement addresses allegations by the United States that, from 2010 through 2014, RB Group directly or through its subsidiaries knowingly: (a) promoted the sale and use of Suboxone to physicians who were writing prescriptions without any counseling or psychosocial support and for uses that were unsafe, ineffective, and medically unnecessary and that were often diverted for uses that lacked a legitimate medical purpose; (b) promoted the sale or use of Suboxone Film to physicians and state Medicaid agencies using false and misleading claims that Suboxone Film was less susceptible to diversion and abuse than other buprenorphine products and that Suboxone Film was less susceptible to accidental pediatric exposure than tablets; and (c) submitted a petition to the Food and Drug Administration on Sept. 25, 2012, claiming that Suboxone Tablet had been discontinued “due to safety concerns” about the tablet formulation of the drug and took other steps to delay the entry of generic competition for Suboxone in order to improperly control pricing of Suboxone, including pricing to federal healthcare programs.
“With the nation continuing to battle the opioid crisis, the availability of quality addiction treatment options is critical. When treatment medications are used, it is essential they be prescribed carefully, legally, and based on accurate information, to protect the health and safety of patients in federal healthcare programs,” said Gary L. Cantrell, Deputy Inspector General for Investigations at the U.S. Department of Health and Human Services. “Along with our federal and state law enforcement partners we will continue working to protect these vulnerable beneficiaries.”
“Opioid manufacturers – like all drug manufacturers – have a duty to market their products both truthfully and safely,” said Craig Carpenito, U.S. Attorney for New Jersey. “Opioid manufacturers have an additional and critically important duty to maintain effective controls to prevent their highly dangerous products from being abused and diverted.”
“The opioid crisis has caused devastation throughout the country, including in the lives of Federal employees, annuitants, and their families,” said Thomas W. South, Deputy Assistant Inspector General for Investigations for the Office of Personnel Management. “The OPM OIG is committed to working with the Department of Justice and our other law enforcement partners to combat this epidemic. As always, patient safety is our number one priority.”
The civil settlement resolves the claims against RB Group in six lawsuits pending in federal court in the Western District of Virginia and the District of New Jersey under the qui tam, or whistleblower provisions of the False Claims Act, which allow private citizens to bring civil actions on behalf of the United States and share in any recovery.
FTC Resolution
Under a separate agreement with the Federal Trade Commission (FTC), RB Group has agreed to pay $50 million to resolve claims that it engaged in unfair methods of competition in violation of the Federal Trade Commission Act, 15 U.S.C. § 53(b). The FTC is filing a complaint in the United States District Court for the Western District of Virginia alleging anticompetitive activities by RB Group designed to impede competition from generic equivalents of Suboxone. RB Group no longer manufactures or markets drug products. As part of a consent decree, RB Group agreed that it would notify the FTC if it began marketing drug products in the United States. RB Group further agreed that if it filed a Citizen Petition with the FDA in connection with a drug product, it would simultaneously disclose to both the FDA and the FTC all studies and data relevant to that Citizen Petition. RB Group further agreed not to withdraw a drug from the market or otherwise disadvantage a drug after obtaining approval to market another drug containing the same active ingredient.
“Buprenorphine products are approved for use in the treatment of Americans struggling to overcome opioid addiction, and, in the middle of the nation’s opioid crisis, RB Group allegedly sought to deny those consumers a lower-cost generic alternative to maintain its lucrative monopoly on the branded drug,” said Gail Levine, a Deputy Director of the FTC’s Bureau of Competition.
A Multilateral Effort
The criminal resolution with RB Group was handled by the U.S. Attorney’s Office for the Western District of Virginia and the Department of Justice’s Consumer Protection Branch based on an investigation by the Virginia Attorney General’s Medicaid Fraud Control Unit; FDA - Office of Criminal Investigation; United States Postal Service – Office of Inspector General; and Department of Health and Human Services - Office of Inspector General. The civil settlement was handled by the Civil Division’s Commercial Litigation Branch, the U.S. Attorney’s Office for the Western District of Virginia, and the U.S. Attorney’s Office for the District of New Jersey. Assistance was provided by representatives of the HHS Office of Counsel to the Inspector General; the HHS Office of the General Counsel, CMS Division; FDA’s Office of Chief Counsel; the U.S. Department of Agriculture Office of the General Counsel; the National Association of Medicaid Fraud Control Units; the Defense Criminal Investigative Service; the Office of Personnel Management - Office of Inspector General; the Department of Veterans’ Affairs Office of Inspector General; the Department of Labor - Office of Inspector General; and TRICARE Program Integrity.
Japanese Fishing Company Convicted of Obstruction of Justice and Falsifying Records to Cover up Illegal Oil and Garbage PollutionRead the Press Release
A Japanese fishing company, Fukuichi Gyogyo Kabushiki Kaisha (“Fukuichi”), was convicted and sentenced today in the District of Guam for two violations of the Act to Prevent Pollution from Ships and one count of obstruction of an agency proceeding.
The charges stemmed from discharges of waste oil and oily bilge water from the F/V Fukuichi Maru No. 112 (“the vessel”) into international waters and the attempt to cover up those discharges when the vessel was inspected by the U.S. Coast Guard in Apra Harbor, Guam. The charges also included failing to properly document the discharge of fishing gear and plastics from the vessel, and obstructing a Coast Guard Port State Control inspection.
“When Fukuichi broke the law when they intentionally discharged oily bilge waste into the ocean. To make matters worse, they tried to cover up their unlawful acts by obstructing the routine Coast Guard inspection, said Assistant Attorney General Jeffrey Bossert Clark for the Justice Department’s Environment and Natural Resources Division. “The Department will continue to work with its partners to ensure that companies, both foreign and domestic, comply with the rule of law.”
U.S. Attorney Shawn N. Anderson stated, “Fukuichi’s fishing vessel plied the waters of the Western Pacific for decades in disregard of basic environmental precautions. It would have continued to do so but for the United States asserting jurisdiction in this criminal prosecution. Our waters and reefs are worthy of protection through punitive enforcement action. We will target any companies or persons who engage in similar unlawful conduct.”
Fukuichi pleaded guilty to one count of obstruction of an agency proceeding, and two counts of violating the Act to Prevent Pollution from Ships. The company was ordered to pay a $1.5 million criminal fine and serve a five-year term of probation, during which vessels owned and/or operated by the company will be banned from entering the Exclusive Economic Zone, Territorial Sea, or a port or terminal belonging to the United States without prior approval. Fukuichi will also be required to implement a comprehensive Environmental Compliance Plan (ECP) that includes vessel audits. The ECP and associated audits must be sent to the nearest U.S. Coast Guard Captain of the Port prior to any of the company’s vessels entering U.S. waters or a U.S. port. The COTP will have the discretion whether to allow such entry based upon the company’s compliance with international and domestic laws governing pollution and safety.
Fukuichi was the owner and operator of the vessel, which conducted fishing operations throughout the Pacific Ocean. The vessel entered Apra Harbor, Guam, on April 1, 2019, for repairs to its cargo refrigeration system. Members of the U.S. Coast Guard boarded the vessel and discovered fifteen pollution and safety deficiencies and detained the vessel. The inspectors discovered numerous leaks of water and oil into the bilges, and asked the Chief Engineer to demonstrate operation of the Oil Water Separator (OWS). The Chief Engineer was unable to demonstrate how to operate the OWS and the inspectors determined the OWS had not been used. According to court documents, the Chief Engineer confessed that the practice on the vessel was to discharge waste oil and oily bilge water directly into the ocean using an emergency bilge pump system and buckets. The inspectors discovered these systems coated with heavy oil. The inspectors examined the vessel’s Oil Record Book, which, oddly, was a single volume that spanned thirty years. The inspectors discovered two hundred and thirty-three incorrect or false entries in the ORB. Later during the inspection, the inspector discovered that the Chief Engineer obstructed their proceeding by erasing forty-two of the fraudulent or incorrect entries and replacing them with new information. The inspectors also examined the vessel’s Garbage Record Book (GRB) and discovered that it contained a series of “ditto” marks instead of the signature of the officer in charge of managing the garbage. The inspectors determined based on crew interviews that animal carcasses and fishing gear, which included plastic, had been discharged from the vessel and not recorded in the GRB.
“I want to highlight the diligent work of the marine investigators who first identified these issues and worked closely with the vessel crew and the Department of Justice for several months to bring it to a conclusion," said Capt. Christopher Chase, Captain of the Port Coast Guard Sector Guam. "Marine pollution prevention and response is a cooperative effort requiring the support of many partner agencies in order to hold those who violate international and U.S. law accountable for their actions. The preservation of the ecosystem here and throughout the Pacific is a top priority for the Coast Guard, and this case is one example of how we complete that mission.”
“This exceptional collaborative effort continues to deter maritime organizations from these types of devastating illegal practices that threaten to destroy our natural living marine resources as well as level the playing field for the many responsible companies who obey the laws and regulations created to protect these finite resources,” said Coast Guard Special Agent-in-Charge Kelly Hoyle.
The case was investigated by U.S. Coast Guard Marine Safety Unit Guam, with assistance from the Coast Guard Investigative Service. The prosecution was handled by Senior Trial Attorney Kenneth E. Nelson of the Environmental Crimes Section of the U.S. Department of Justice and Assistant United States Attorneys Mikel Schwab and Marivic David of the District of Guam.
Japanese Fishing Company Convicted of Obstruction of Justice and Falsifying Records to Cover up Illegal Oil and Garbage PollutionRead the Press Release
A Japanese fishing company, Fukuichi Gyogyo Kabushiki Kaisha (Fukuichi), was convicted and sentenced today in the District of Guam for two violations of the Act to Prevent Pollution from Ships and one count of obstruction of an agency proceeding.
The charges stemmed from discharges of waste oil and oily bilge water from the F/V Fukuichi Maru No. 112 (the vessel) into international waters and the attempt to cover up those discharges when the vessel was inspected by the U.S. Coast Guard in Apra Harbor, Guam. The charges also included failing to properly document the discharge of fishing gear and plastics from the vessel, and obstructing a Coast Guard Port State Control inspection.
“Fukuichi broke the law when the company intentionally discharged oily bilge waste into the ocean. To make matters worse, Fukuichi tried to cover up their unlawful acts by obstructing the routine Coast Guard inspection,” said Assistant Attorney General Jeffrey Bossert Clark for the Justice Department’s Environment and Natural Resources Division. “The Department will continue to work with its partners to ensure that companies, both foreign and domestic, comply with the rule of law.”
U.S. Attorney Shawn N. Anderson stated, “Fukuichi’s fishing vessel plied the waters of the Western Pacific for decades in disregard of basic environmental precautions. It would have continued to do so but for the United States asserting jurisdiction in this criminal prosecution. Our waters and reefs are worthy of protection through punitive enforcement action. We will target any companies or persons who engage in similar unlawful conduct.”
Fukuichi pleaded guilty to one count of obstruction of an agency proceeding, and two counts of violating the Act to Prevent Pollution from Ships. The company was ordered to pay a $1.5 million criminal fine and serve a five-year term of probation, during which vessels owned and/or operated by the company will be banned from entering the Exclusive Economic Zone, Territorial Sea, or a port or terminal belonging to the United States without prior approval. Fukuichi will also be required to implement a comprehensive Environmental Compliance Plan (ECP) that includes vessel audits. The ECP and associated audits must be sent to the nearest U.S. Coast Guard Captain of the Port prior to any of the company’s vessels entering U.S. waters or a U.S. port. The COTP will have the discretion whether to allow such entry based upon the company’s compliance with international and domestic laws governing pollution and safety.
Fukuichi was the owner and operator of the vessel, which conducted fishing operations throughout the Pacific Ocean. The vessel entered Apra Harbor, Guam, on April 1, 2019, for repairs to its cargo refrigeration system. According to court documents, members of the U.S. Coast Guard boarded the vessel and discovered fifteen pollution and safety deficiencies and detained the vessel. The inspectors discovered numerous leaks of water and oil into the bilges and the Chief Engineer confessed that the practice on the vessel was to discharge waste oil and oily bilge water directly into the ocean using an emergency bilge pump system and buckets. The inspectors discovered these systems coated with heavy oil. The inspectors examined the vessel’s Oil Record Book and discovered two hundred and thirty-three incorrect or false entries. Later during the inspection, the inspector discovered that the Chief Engineer obstructed their proceeding by erasing forty-two of the fraudulent or incorrect entries and replacing them with new information. The inspectors also examined the vessel’s Garbage Record Book (GRB) and discovered that it contained a series of “ditto” marks instead of the signature of the officer in charge of managing the garbage. The inspectors determined based on crew interviews that animal carcasses and fishing gear, which included plastic, had been discharged from the vessel and not record in the GRB.
“I want to highlight the diligent work of the marine investigators who first identified these issues and worked closely with the vessel crew and the Department of Justice for several months to bring it to a conclusion," said Capt. Christopher Chase, Captain of the Port Coast Guard Sector Guam. "Marine pollution prevention and response is a cooperative effort requiring the support of many partner agencies in order to hold those who violate international and U.S. law accountable for their actions. The preservation of the ecosystem here and throughout the Pacific is a top priority for the Coast Guard, and this case is one example of how we complete that mission.”
“This exceptional collaborative effort continues to deter maritime organizations from these types of devastating illegal practices that threaten to destroy our natural living marine resources as well as level the playing field for the many responsible companies who obey the laws and regulations created to protect these finite resources,” said Coast Guard Special Agent-in-Charge Kelly Hoyle.
The case was investigated by U.S. Coast Guard Marine Safety Unit Guam, with assistance from the Coast Guard Investigative Service. The prosecution was handled by Senior Trial Attorney Kenneth E. Nelson of the Environmental Crimes Section of the U.S. Department of Justice and Assistant United States Attorneys Mikel Schwab and Marivic David of the District of Guam.
Department of Justice Enables Direct Tribal Access to FBI National Sex Offender RegistryRead the Press Release
The U.S. Department of Justice announced today a new tool giving tribal governments the ability to directly input data and gain access to the FBI’s National Sex Offender Registry (NSOR) using the Tribe and Territory Sex Offender Registry System (TTSORS). The system connection will be available to all tribal governments already participating in the Tribal Access Program (TAP), which allows information sharing between tribal and federal government criminal information systems.
TTSORS is a no-cost registry system provided by the Justice Department’s Office of Sex Offender Sentencing, Monitoring, Apprehending, Registering, and Tracking (SMART). The Department’s Office of the Chief Information Officer (OCIO) developed the connections which allows tribes to seamlessly submit new and updated sex offender information directly from TTSORS to NSOR.
“The Department of Justice is dedicated to addressing the public safety crisis in American Indian and Alaska Native communities, including the high rates of sexual violence against women and children,” said Attorney General William P. Barr. “Providing a direct connection to the FBI National Sex Offender Registry gives tribal law enforcement the information they need to investigate and prevent these heinous offenses.”
American Indian and Alaska Native people suffer persistently high rates of victimization, including from sexual assault. According to a 2016 study funded by the National Institute of Justice, more than four in five American Indian and Alaska Native adults have experienced some form of violence in their lifetime, and more than half of all American Indian and Alaska Native women have experienced violence from an intimate partner. In June, the department extended a deadline for tribes to apply for up to $167 million in federal funds through August 16, 2019, to support crime victims throughout Indian country.
“The direct connection between the National Sex Offender Registry and Tribe and Territory Sex Offender Registry System provides increased resources for identifying, tracking, and sharing information about persons convicted of committing these crimes,” said Gwendena L. Gatewood, Chairwoman of the White Mountain Apache Tribe of the Fort Apache Indian Reservation. “It will also allow for further improvements in providing a safer community for all involved to integrate tribal law, custom, tradition and practices in a comprehensive fashion consistent with holding offenders accountable.”
“Standing Rock has always had a priority of ensuring public safety,” said Mike Faith, Chairman of the Standing Rock Sioux Tribe. “Technological advances to our systems ensure that our SORNA staff are able to input offender information and get back in the field while ensuring compliance is maintained.”
The Sex Offender Registration and Notification Act, Title I of the Adam Walsh Child Protection and Safety Act of 2006, requires that, when an offender initially registers or updates his or her information in a jurisdiction, that the state, tribe, territory or District of Columbia must submit immediately the information to NSOR as well as other jurisdictions where the offender has to register. TTSORS is a fully functioning registry system that complies with SORNA requirements. TTSORS was created to assist the Indian tribes that have elected to implement SORNA.
Since 2015, the SMART Office, OCIO, the FBI, the Office of Tribal Justice, Community Oriented Policing Services and the Office for Victims of Crime, have worked together to develop the Tribal Access Program to provide tribes direct access to national crime information systems for both criminal and non-criminal justice purposes. This includes the ability to directly enter NSOR data and enhance the capacity to collect and submit fingerprints and palm prints to the FBI. TAP has been instrumental in assisting tribes with ongoing implementation of SORNA. In fiscal year 2019, the department expanded TAP to 25 more tribes, for a total of 72 participating tribes.
Antitrust Division Announces New Policy to Incentivize Corporate ComplianceRead the Press Release
During remarks today, Assistant Attorney General Makan Delrahim announced the Antitrust Division’s new policy for incentivizing antitrust compliance. For the first time, the Division will consider compliance at the charging stage in criminal antitrust investigations, a change which is reflected in the Justice Manual. The Division also announced revisions to its Manual and published a document to guide prosecutors’ evaluation of corporate compliance programs at the charging and sentencing stage.
“The Antitrust Division is committed to rewarding corporate efforts to invest in and instill a culture of compliance,” said Assistant Attorney General Delrahim. “The Division’s Leniency Policy has long provided the ultimate credit for effective antitrust compliance programs. Beyond leniency, recently we have credited prospective compliance efforts at sentencing. Crediting compliance at charging is the next step in our continued efforts to deter antitrust violations and reward good corporate citizenship. We also remain dedicated to predictability and transparency. As such, in concert with today’s policy changes, the Division issued a public guidance document that outlines what prosecutors look for when evaluating antitrust compliance programs.”
The Justice Manual previously explained the Antitrust Division’s policy “that credit should not be given at the charging stage for a compliance program.” That text has been deleted.
The Division also updated its Manual. The revisions address evaluating compliance programs at the charging and sentencing stage, and Division processes for recommending indictments, plea agreements, and selecting monitors.
For the first time, the Division also published a guidance document that focuses on evaluating compliance programs in the context of criminal violations of the Sherman Act. It is intended to assist Division prosecutors in their evaluation of compliance programs at both the charging and sentencing stage of investigations, and to provide compliance officers and the public greater transparency of the Division’s compliance analysis. To that end, it contains two sections: the first relates to evaluating antitrust compliance programs at the charging stage, and the second addresses compliance considerations at sentencing.
Former U.S. Government Contractor Pleads Guilty to Falsifying Training CertificatesRead the Press Release
A former U.S. government contractor pleaded guilty today to making counterfeit training certificates for individuals seeking employment on government contracts in Afghanistan.
Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, Special Inspector General for Afghanistan Reconstruction (SIGAR) John F. Sopko, Special Agent in Charge Robert E. Craig Jr. of the Defense Criminal Investigative Service (DCIS) Mid-Atlantic Field Office, Director Frank Robey of the U.S. Army Criminal Investigation Command’s (CID) Major Procurement Fraud Unit and Assistant Director Robert Johnson of the FBI’s Criminal Investigative Division made the announcement.
Antonio Jones, 40, of Yorktown, Virginia, pleaded guilty to one count of making false statements before U.S. District Judge Donald C. Coggins of the District of South Carolina. Sentencing has not yet been scheduled.
As part of his guilty plea, Jones admitted to making and/or causing to have made false Department of Transportation hazardous material (HAZMAT) training certificates to help an individual get a job handling HAZMAT in Afghanistan. A South Carolina-based contractor accepted the fake HAZMAT certificate as proof that Jones’s client had attended a training course prescribed by federal regulation and was otherwise suitable for employment when in fact, the client had not attended the HAZMAT course or any other HAZMAT course, Jones admitted.
Jones was charged in a 13-count indictment on Dec. 12, 2018. The indictment alleges that he and a co-conspirator purported to offer job placement services to individuals seeking employment in Afghanistan and elsewhere. In fact, according to the indictment, they created fake training certificates and false resumes to make their clients appear more qualified than they actually were, and used the false documents to apply for jobs on their clients’ behalf.
This case was investigated by SIGAR, the FBI, DCIS and the U.S. Army CID. The case is being prosecuted by Trial Attorney Michael P. McCarthy of the Criminal Division’s Fraud Section.
Attorney General William P. Barr Announces Emergency Funding to Address Public Safety Crisis in Rural AlaskaRead the Press Release
Justice Department Authorizes More than $10 Million in Immediate Funding to Support Police in Alaska Native Villages and Additional Resources to Support Child Advocacy Centers in Rural Hubs, Expanding Prosecution Resources and Project Safe Neighborhoods Crime Reduction Measures
Attorney General William P. Barr declared a law enforcement emergency in rural Alaska under the Emergency Federal Law Enforcement Assistance Program today, making $6 million immediately available to the state of Alaska for critical law enforcement needs of Alaska Native villages. Recognizing that Alaska has the highest per capita crime rate in the country and the unique circumstances of Alaska’s geographical and jurisdictional landscape, the Attorney General authorized additional funding and several long-term measures to support village public safety and victim services.
The $6 million in emergency funding from the Office of Justice Program’s Bureau of Justice Assistance (OJP-BJA) will go toward hiring, equipping, and training Village Public Safety Officers (VPSOs), Village Police Officers (VPOs), and Tribal Police Officers (TPOs) working in rural Alaska, as well as for mobile detention facilities.
In addition, the Department of Justice Office on Community Oriented Policing Services (COPS) will award $4.5 million in funding for 20 officer positions, along with equipment and training, to Alaska Native grantees by the end of July.
The Office for Victims of Crime (OVC) and the Office on Juvenile Justice and Delinquency Prevention (OJJDP) will support Children’s Advocacy Centers (CAC) in rural Alaska’s major hubs, which provide wrap-around services, forensic interviews, and medical exams for child victims. OVC and OJJDP have identified up to $14 million in available funding for CACs in Alaska and the lower 48 states.
“In May, when I visited Alaska, I witnessed firsthand the complex, unique, and dire law enforcement challenges the State of Alaska and its remote Alaska Native communities are facing,” said Attorney General Barr. “With this emergency declaration, I am directing resources where they are needed most and needed immediately, to support the local law enforcement response in Alaska Native communities, whose people are dealing with extremely high rates of violence. Today, I am also directing each component and law enforcement agency of the Justice Department to submit plans within the next 30 days to further support federal, state, and tribal public safety efforts in rural Alaska. Lives depend on it, and we are committed to seeing a change in this unacceptable, daily reality for Alaska Native people.”
The Attorney General also announced a Rural Alaska Violent Crime Reduction Working Group, led by U.S. Attorney Bryan Schroder. The Working Group will look for ways to build the capacity of federal, state, and tribal law enforcement in rural Alaska and its work will have a particular emphasis on crimes of domestic violence and crimes against children. BJA is also making an additional $162,000 available to the U.S. Attorney’s Office to establish an additional Project Safe Neighborhoods (PSN) target site encompassing rural Alaska.
Alaska is home to some of the most remote communities in all of America. This geographic isolation contributes to law enforcement problems not seen anywhere else in our Nation. According to one estimate, one-third of Alaskan villages have no local law enforcement personnel at all. According to a 2016 study funded by the National Institute of Justice, more than four in five American Indian and Alaska Native adults have experienced some form of violence in their lifetime, and more than half of all American Indian and Alaska Native women have experienced violence from an intimate partner. The lack of law enforcement resources results in a high violent crime rate, especially in Alaska Native communities.
Additional near-term measures by Department of Justice components include:
- The Office on Violence Against Women (OVW) will issue an award for sexual assault training and technical assistance in Alaska, including training community health aides in Alaska Native villages to perform sexual assault forensic exams and training for victim advocates. The project will include community sexual assault training, which will address coordinated responses to sexual assault across the community. This award will also train village-based victim advocates to accompany victims throughout the process, including prosecution, as appropriate.
- OVC is extending their application deadline for the Crime Victim Fund tribal set-aside solicitation (part of the $167 million available to tribes for victim services in FY 2019) to Aug. 16, 2019. This money may be used to fund direct services and advocacy, domestic violence shelters, rape crisis services, children advocacy programs, and elder abuse programs.
- BJA is extending their application deadline to July 15, 2019, for programs that target mental health/drug addiction, reentry initiatives, and community crime reduction.
- The COPS Office has two grant programs that it will reopen to afford Alaska the opportunity to apply:
- The Anti-Methamphetamine Program (CAMP) is open to state law enforcement agencies with multijurisdictional reach and interdisciplinary team (e.g., task force) structures, in states with high seizures of precursor chemicals, finished methamphetamine, laboratories, and laboratory dump seizures.
- The COPS Anti-Heroin Task Force (AHTF) Program is open to state law enforcement agencies with multi-jurisdictional reach and interdisciplinary team (e.g., task force) structures, in states with high per capita rates of primary treatment admissions.
As the Department develops a comprehensive response to public safety issues in Alaska, Attorney General Barr expressed his commitment to working closely with American Indian and Alaska Native leadership as well as Congressional and state representatives to ensure Departmental solutions are practical and effective. The Attorney General will also travel to an Indian country location in the lower 48 states in the coming months, recognizing the significant public safety challenges that persist for many Native American communities.
“I want to be sure that the support this Department offers to Alaska Native communities will support solutions identified by the communities themselves,” said Attorney General Barr. “The only way for us to provide effective support is to work in partnership with others. This is true in Alaska and throughout Indian country.”
In a memo to all Justice Department component leaders, the Attorney General directed every component and law enforcement agency to submit a plan in the next 30 days to further support these efforts in Alaska, focusing in particular on the following goals:
- Increasing the federal, state, local, and tribal law enforcement presence in Alaska and ways to provide more prosecutorial resources for the criminal cases that will result from increased law enforcement presence;
- Reducing violent crime, especially gun violence;
- Decreasing sexual assaults of women and children;
- Providing better immediate and long-term services to victims of crime;
- Cutting off supplies of methamphetamines, opioids, and other illegal drugs;
- Addressing the problem of alcohol abuse and its role in violent crime and crimes against children;
- Increasing addiction prevention and treatment services to those struggling with addictions to drugs and alcohol;
- Providing adequate detention facilities in remote locations; and,
- Incorporating technology into law enforcement efforts to improve response times and decrease travel costs for victims and witnesses.
Former HUD Assistant Inspector General Indicted for Concealing Procurement Fraud SchemeRead the Press Release
A seven-count indictment was returned yesterday charging a former Assistant Inspector General for the U.S. Department of Housing and Urban Development, Office of Inspector General, with engaging in a scheme to conceal material facts, making false statements and falsification of records.
Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, Acting Assistant Director in Charge John P. Selleck of the FBI’s Washington Field Office and Michael K. Atkinson, Inspector General of the Intelligence Community made the announcement.
According to the indictment, between early 2012 and mid-2016, Eghbal “Eddie” Saffarinia engaged in a scheme to conceal material facts, including the nature and extent of Saffarinia’s financial relationship with a personal friend who was the owner and chief executive officer of an information technology company in Virginia. During a period in which Saffarinia received payments and loans from his friend totaling $80,000, Saffarinia disclosed confidential internal government information to his friend and undertook efforts to steer government contracts and provide competitive advantages and preferential treatment to his friend’s company. Saffarinia also failed to disclose this financial relationship and another large promissory note on his public financial disclosure forms.
The case is being investigated by the FBI’s Washington Field Office and the Office of the Inspector General of the Intelligence Community. Trial Attorneys Edward P. Sullivan and Rosaleen T. O’Gara of the Criminal Division’s Public Integrity Section are prosecuting the case.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Former Financial Services Executive Pleads Guilty to Rigging Bids for Financial Instruments in Violation of Antitrust LawRead the Press Release
Larry D. Meyers, the former head of the securities lending desk at Banca IMI Securities Corp., pleaded guilty to a criminal antitrust charge for his involvement in a bid-rigging conspiracy for certain financial instruments, the Department of Justice announced.
Meyers admitted that, from at least as early March 2012 until at least August 2014, he and his counterparts at other broker-dealers conspired to submit rigged bids to borrow pre-release American Depository Receipts (ADRs). Meyers’ plea is the third in the ongoing investigation; Banca IMI and Industrial and Commercial Bank of China Financial Services LLC previously pleaded guilty on May 10, 2019, and June 14, 2019, respectively.
Worldwide, thousands of publicly traded companies list their shares of common stock only on foreign stock exchanges. Most U.S. investors are unable to purchase or sell such foreign shares. The U.S. Securities and Exchange Commission, however, permits four U.S. depository banks to create ADRs, which represent foreign ordinary shares and can be traded in the United States. Through the purchase and sale of ADRs, U.S. investors are able to gain exposure to — including the ability to receive dividends from — companies whose common stock is listed only on foreign exchanges.
Meyers pleaded guilty to conspiring to borrow pre-release ADRs from U.S. depository banks at artificially suppressed rates. During the conspiracy, a U.S. depository bank began using an auction-style process for pre-release ADRs and invited Banca IMI and other broker-dealers to submit competitive bids for rates to borrow ADRs. In response, Meyers and his co-conspirators intensified their coordination in an effort to artificially increase their profits under the auction-style process. On at least 30 occasions, Banca IMI reached an agreement with one or more co-conspirators as to the bids they would submit to U.S. depository banks. On many occasions, the conspirators agreed that they all would submit the same bid. Meyers and his co-conspirators reached these agreements using, among other means, private chat rooms and text messages.
“The guilty plea announced today represents the commitment of the Division and its law enforcement partners to hold accountable for market-corrupting collusion not just the companies that benefit from that unlawful activity, but also the executives who carry it out,” said Assistant Attorney General Makan Delrahim of the Department of Justice’s Antitrust Division.
“This guilty plea highlights just how thorough FBI investigations truly are,” said Assistant Director Robert Johnson of the FBI’s Criminal Investigative Division. “Individuals engaged in corrupt activity cannot expect to hide behind their companies. The FBI is committed to pursuing all those who use criminal means to enrich themselves at the expense of U.S. investors.”
“The FBI is committed to investigating companies and executives when they operate outside the law and attempt to play by different rules in the marketplace,” Charles A. Dayoub, Acting Special Agent in Charge of the Criminal Division at the FBI’s Washington Field Office. “I would like to thank the dedicated FBI agents and analysts who have worked on this investigation and are committed to holding those accountable who ignore the rule of law in the United States.”
A criminal violation of Section 1 of the Sherman Act carries a maximum term of imprisonment of 10 years and a maximum fine of $1 million for individuals. The fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.
The Washington Criminal II Section of the Antitrust Division and the FBI’s International Corruption Squad in Washington, D.C., are conducting the investigation into bid rigging in the market for pre-release ADRs. 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 www.justice.gov/atr/contact/newcase.html.
Two International Shipping Executives Indicted for Participating in Long-Running Antitrust ConspiracyRead the Press Release
An indictment of two Norwegian shipping executives was unsealed in the U.S. District Court in Baltimore, the Department of Justice announced today.
Ingar Skiaker and Øyvind Ervik have been charged with participating in a long-running conspiracy to allocate certain customers and routes, rig bids, and fix prices for the sale of international ocean shipments of roll-on, roll-off cargo to and from the United States and elsewhere, including the Port of Baltimore. A federal grand jury returned the indictment in February 2018.
Skiaker and Ervik, both Norwegian citizens, are former top executives at Höegh Autoliners AS, which has pleaded guilty and been sentenced to pay a $21 million fine. Including the charges announced today, 13 executives have been charged in the investigation to date. Four have pleaded guilty and been sentenced to serve prison terms. Others remain international fugitives. Including Höegh, five companies have also pleaded guilty for their roles in this conspiracy, resulting in total collective criminal fines over $255 million.
The indictment alleges that, from at least as early as 2006 and continuing at least until September 2012, Skiaker and Ervik conspired with their competitors to allocate certain customers and routes for the shipment of cars and trucks. The defendants accomplished their scheme by, among other things, attending meetings during which they agreed not to compete against each other, and by refraining from bidding or by agreeing on the prices they would bid for certain customers and routes. In addition, Skiaker and Ervik agreed with competitors to fix, stabilize, and maintain rates charged to customers of international ocean shipping services. The customers affected by the conspiracy included U.S. companies.
“The Division’s investigation revealed that collusion was endemic and rampant in the shipping industry going back years,” said Assistant Attorney General Makan Delrahim of the Justice Department’s Antitrust Division. “The indictment unsealed today advances the Division’s mission to restore and promote open competition. Höegh has already pleaded guilty, and now we must ensure that its executives will be held accountable.”
“The schemes that took place in perpetuating this long-running conspiracy show a clear indifference for the free market, and a willful disregard for the law,” said Special Agent in Charge Jennifer C. Boone for the FBI Baltimore Field Office. “The protection of international commerce and victims affected by such schemes remain a priority for the FBI and we will continue to dedicate resources to these types of investigations in order to protect the United States economy.”
An indictment merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt.
Today’s announcement is the result of an ongoing federal antitrust investigation into price fixing, bid rigging, and other anticompetitive conduct in the international roll-on, roll-off ocean shipping industry, which is being conducted by the Antitrust Division’s Washington Criminal I Section and the FBI’s Baltimore Field Office, along with assistance from the U.S. Customs and Border Protection Office of Internal Affairs, Washington Field Office/Special Investigations Unit. Anyone with information in connection with this investigation is urged to call the Antitrust Division’s Washington Criminal I Section at 202-307-6694, visit www.justice.gov/atr/contact/newcase.html or call the FBI’s Baltimore Field Office at 410-265-8080.
Two Freight Transportation Executives Sentenced to Prison Terms for Price FixingRead the Press Release
Two executives were sentenced in U.S. District Court in Miami for their role in a conspiracy to fix prices of international freight forwarding services, the Department of Justice announced today. Roberto Dip and Jason Handal were charged with fixing prices in June 2018, and pleaded guilty in November 2018. A magistrate judge in Miami ordered Dip detained pending trial; he served over five months in jail before being released on bond.
Dip, the president and CEO of a Louisiana-based freight forwarding company, and Handal, the company’s manager, organized meetings throughout the United States where they reached agreements with their competitors to fix the prices for freight forwarding services provided in the United States and elsewhere from at least as early as September 2010 until at least March 2015. Dip was sentenced to 18 months’ imprisonment, with credit for time served. Handal was sentenced to 15 months’ imprisonment. Each executive was also sentenced to pay a $20,000 criminal fine and to three years of supervised release.
“These defendants’ conduct raised freight-forwarding prices by as much as 20 percent, victimizing vulnerable consumers and individuals sending gifts and household goods to family members and loved ones for holidays,” said Assistant Attorney General Makan Delrahim of the Department of Justice’s Antitrust Division. “Today’s sentences reflect the significant harm that the defendants caused, and should send a message to other would-be price-fixers that this crime will not go unpunished.”
“This investigation is an example of the FBI’s commitment to investigating individuals when they operate outside the law to conspire to fix prices in the consumer marketplace,” stated Eric J. Rommal, FBI New Orleans Special Agent in Charge. “I would like to thank the investigative team and Department of Justice’s Antitrust Division prosecutors who have worked on this complex investigation and are committed to holding those accountable who disregard the rule of law for their own financial gain. The FBI will continue to work to protect consumers against all forms of fraud, deceit, and illegal activity.”
The ongoing investigation into price fixing in the international freight forwarding industry is being conducted by the Antitrust Division’s Washington Criminal I Section and the FBI’s New Orleans Division. Anyone with information in connection with this investigation is urged to call the Antitrust Division’s Washington Criminal I Section at 202-307-6694, visit www.justice.gov/atr/contact/newcase.html or call the FBI tip line at 415-553-7400.
Merrill Lynch Commodities Inc. Enters into Corporate Resolution and Agrees to Pay $25 Million in Connection with Deceptive Trading Practices Executed on U.S. Commodities MarketsRead the Press Release
Merrill Lynch Commodities Inc. (MLCI), a global commodities trading business, has agreed to pay $25 million to resolve the government’s investigation into a multi-year scheme by MLCI precious metals traders to mislead the market for precious metals futures contracts traded on the Commodity Exchange Inc. (COMEX), announced Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and Assistant Director in Charge William F. Sweeney Jr. of the FBI’s New York Field Office.
According to MLCI’s admissions, beginning by at least 2008 and continuing through 2014, precious metals traders employed by MLCI schemed to deceive other market participants by injecting materially false and misleading information into the precious metals futures market. They did so by placing fraudulent orders for precious metals futures contracts that, at the time the traders placed the orders, they intended to cancel before execution. In doing so, the traders intended to “spoof” or manipulate the market by creating the false impression of increased supply or demand and, in turn, to fraudulently induce other market participants to buy and to sell futures contracts at quantities, prices and times that they otherwise likely would not have done so. Over the relevant period, the traders placed thousands of fraudulent orders.
MLCI entered into a non-prosecution agreement (NPA) and agreed to pay a combined $25 million in criminal fines, restitution and forfeiture of trading profits. Under the terms of the NPA, MLCI and its parent company, Bank of America Corporation (BAC), have agreed to cooperate with the government’s ongoing investigation of individuals and to report to the Department evidence or allegations of violations of the wire fraud statute, securities and commodities fraud statute, and anti-spoofing provision of the Commodity Exchange Act in BAC’s Global Markets’ Commodities Business, whose function is to conduct wholesale, principal trading and sales of commodities. MLCI and BAC also agreed to enhance their existing compliance program and internal controls, where necessary and appropriate, to ensure they are designed to detect and deter, among other things, manipulative conduct in BAC’s Global Markets Commodities Business.
The Department reached this resolution based on a number of factors, including MLCI’s ongoing cooperation with the United States and MLCI and BAC’s remedial efforts, including conducting training concerning appropriate market conduct and implementing improved transaction monitoring and communication surveillance systems and processes.
The Commodity Futures Trading Commission (CFTC) announced a separate settlement with MLCI today in connection with related, parallel proceedings. Under the terms of the resolution with the CFTC, MLCI agreed to pay approximately $25 million, which includes a civil monetary penalty of $11.5 million, as well as restitution, and disgorgement, with restitution and disgorgement credited for any such payments made to the Department. In addition, the CFTC order imposes upon MLCI other remedial and cooperation obligations in connection with any CFTC investigation pertaining to the underlying conduct.
As part of the investigation, the Department obtained an indictment against Edward Bases and John Pacilio, two former MLCI precious metals traders, in July 2018. Those charges remain pending in the U.S. District Court for the Northern District of Illinois. See United States v. Edward Bases and John Pacilio, 18-cr-48 (N.D. Ill.). All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
This case was investigated by the FBI’s New York Field Office. Trial Attorneys Ankush Khardori and Avi Perry of the Criminal Division’s Fraud Section prosecuted the case. The CFTC also provided assistance in this matter.
If you believe you are a victim of this offense, please visit https://www.justice.gov/criminal-vns/case/mlci or call (888) 549-3945.
Federal Court Bars Florida Tax Return Preparer and Businesses from Preparing Tax ReturnsRead the Press Release
A federal court in Orlando, Florida, entered a permanent injunction against Lakeesha Tucker, Lakeesha Tucker LLC, and Simplified Financial Services LLC, barring them from preparing federal tax returns for others and owning or operating a tax preparation business, the Justice Department announced today.
The court previously entered a judgment against all three defendants for $1,628,046.50, after an earlier order stated that this amount was a reasonable approximation of defendants’ ill-gotten gains they received for the preparation of tax returns.
In its complaint, the government alleged that the defendants prepared tax returns making false or fraudulent claims for the Earned Income Tax Credit. Among the misconduct alleged, defendants reported phony business-related income and expenses, and job-related expenses, and claimed false education credits and charitable contributions.
Return preparer fraud is one of the IRS’s Dirty Dozen Tax Scams and taxpayers seeking a return preparer should remain vigilant. The IRS has information on its website for choosing a return preparer and has launched a free directory of federal tax preparers.
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.
Attorney General William P. Barr Announces Recipients for the 33rd Annual Attorney General's Volunteer AwardsRead the Press Release
WASHINGTON – Today, Attorney General William P. Barr announced the recipients for the 33rd Annual Attorney General’s Volunteer Awards Ceremony, awarded to those within the Department of Justice, and members of the general public, who have shown admirable dedication to improving their communities. These awards are separated into two different categories, the Attorney General’s Volunteer Award for Community Service and the Attorney General’s Citizen Volunteer Service Award.
The first award, the Attorney General’s Volunteer Award for Community Service, is awarded to an employee or group of employees from the Department, who have shown exemplary community service efforts. The recipients of this year’s award are:
- Brian K. Caserta, U.S. Marshal Service, for his work with the Sports Training Academics Recreation/Police Athletics League to empower youth and build a safer community through positive encounters with law enforcement in San Diego, California;
- Roland L. Hankey II, FBI, for his service as an Emergency Medical Technician with the Culpeper County (Virginia) Volunteer Rescue Squad;
- Drew Yeates, U.S. Attorney’s Office for the District of Utah, for his sustained pro bona work with the Safe Harbor Crisis Center in Layton, Utah, assisting victims of domestic violence.
The second award, the Attorney General’s Citizen Volunteer Service Award, is awarded to members of the public for their outstanding volunteer contributions towards the Department’s mission. The recipients of this year’s award are:
- Laura D. Martin and Patricia A. Torchia, for their volunteer service providing inmates with re-entry life skills at the Federal Medical Center - Rochester, Minnesota;
- Max Schachter, for his relentless work supporting the creation of national school safety best practices as Founder and CEO of Safe Schools for Alex.
“Today we honor these exceptional men and women for their remarkable contributions to protecting and improving their communities,” said Attorney General William P. Barr. “To take only a few examples, they have strived to keep schoolchildren safe, empowered victims of domestic violence, provided inmates with re-entry life skills, and fostered trust between law enforcement and youth. Our awardees’ communities have been made immeasurably better for their efforts. The Department of Justice and a grateful country thank them for their work.”
Justice Department Sues to Block Quad’s Acquisition of LSCRead the Press Release
The Department of Justice filed a civil antitrust lawsuit today seeking to block Quad/Graphics Inc.’s proposed acquisition of LSC Communications Inc. in order to preserve competition in the markets for magazine, catalog, and book printing services in the United States.
The Antitrust Division’s lawsuit alleges that the transaction would combine the only two significant providers of magazine, catalog, and book printing services, denying publishers and retailers throughout the country the benefits of competition that has spurred lower prices, improved quality, and greater printing output. The Department filed its lawsuit in the U.S. District Court for the Northern District of Illinois.
“American publishers and retailers rely on Quad and LSC to print and distribute billions of magazines, catalogs, and books each year,” said Assistant Attorney General Makan Delrahim of the Justice Department’s Antitrust Division. “LSC is Quad’s primary competitor. If this deal were allowed to proceed, Quad would dominate the markets for magazine, catalog, and book printing services and be able to raise prices and reduce quality at the expense of publishers, retailers, and, ultimately, American consumers.”
The magazine, catalog, and book printing services offered by Quad and LSC include the printing, finishing, and distribution of publications to newsstands, retail facilities, or the postal service for delivery to consumers’ homes. Quad and LSC are by far the largest printers in the United States and are relied upon by many of the largest publishers and retailers to ensure that high-quality products are printed and distributed on time.
According to the Department’s complaint, Quad and LSC view each other as their “#1 competitor,” and intense head-to-head competition between them has directly benefitted their customers through lower prices and better-quality services. The complaint quotes internal presentations and emails describing this competition:
- Internal documents outline the “two-horse race between LSC and Quad.”
- A Quad internal presentation explained, “we are the only printer other than LSC that can offer the largest Publishers a complete solution.”
- Executives observed a publisher “exploiting the fact that LSC [and] Quad[’s] CEO’s want to beat each other into oblivion.”
- A senior Quad executive remarked of LSC, “We’ve been in a price war with them for some time. Don’t see that changing.”
- After hearing news of the merger, one Quad executive reflected on a recent battle between it and LSC and remarked, “I admit, in the case of [a large customer] I’m taking significant satisfaction in the news . . . . I’m sure it’s a bitter pill for them to swallow.”
The complaint alleges that Quad’s proposed acquisition of LSC would put an end to the “price war” between the two and allow it to dominate the magazine, catalog, and book printing markets.
Quad/Graphics Inc. is a Wisconsin corporation headquartered in Sussex, Wisconsin. It offers a variety of printing services, including magazine, catalog, and book printing services, to publishers across the country. In 2018, Quad’s revenues were approximately $4.2 billion.
LSC Communications Inc. is a Delaware corporation headquartered in Chicago, Illinois. In 2016, it was spun off from printing firm R.R. Donnelley. LSC offers a similar set of magazine, catalog, and book printing services as Quad. In 2018, LSC’s revenues were approximately $3.8 billion.
Justice Department Settles Housing Discrimination Lawsuit Against St. Bernard Parish, LouisianaRead the Press Release
The Department of Justice announced today that St. Bernard Parish, Louisiana, has agreed to pay more than $1 million to settle a lawsuit alleging that the Parish violated the Fair Housing Act when it refused to allow two small group homes for up to five children with disabilities to open in single-family neighborhoods.
“The Fair Housing Act prohibits local governments from applying their zoning laws in a manner that discriminates against persons with disabilities,” said Assistant Attorney General Eric Dreiband of the Civil Rights Division. “This settlement underscores the Civil Rights Division’s commitment to ensure that children with disabilities have access to housing in all communities.”
“Access to safe, sanitary, and secure housing is a fundamental civil right for all persons within the Eastern District of Louisiana, and this settlement agreement continues efforts to ensure compliance to The Fair Housing Act,” said U.S. Attorney Peter G. Strasser for the Eastern District of Louisiana. “I commend the cooperative efforts of St. Bernard Parish to reach a resolution that is in the best interests of our community.”
“Persons with disabilities have a right to have access to the type of housing that meets their needs,” said Anna María Farías, HUD’s Assistant Secretary for Fair Housing and Equal Opportunity. “Today’s settlement sends a strong message that HUD and the Justice Department are committed to ensuring that cities and municipalities fully adhere to the requirements of the Fair Housing Act.”
The United States’ suit, filed in U.S. District Court in New Orleans, Louisiana, in December 2018, alleged that St. Bernard Parish violated the Fair Housing Act when it denied requests for reasonable accommodations to its zoning ordinance to allow the two group homes to operate in single-family neighborhoods of the Parish. Shortly after learning that the homes were planning to open, the Parish amended its zoning code to prohibit group homes of any size in single-family neighborhoods. The two group home operators filed complaints with HUD, which in turn referred the complaints to the Department of Justice. The group home operators filed a lawsuit in 2016, which they have settled with the Parish.
Under the settlement, St. Bernard Parish will pay $975,000 in monetary damages and attorneys’ fees to the two group home operators, and a $60,000 civil penalty to the United States. The Parish amended its zoning ordinance to permit small group homes in single-family residential districts, amended its reasonable accommodation policy, and will take a number of actions to guard against further housing discrimination. These other actions include training officials and individuals involved in zoning and land use, designating a fair housing compliance officer, and reporting periodically to the Department of Justice during the term of the agreement.
The federal Fair Housing Act prohibits discrimination in housing based on disability, race, color, religion, national origin, sex and familial status. Individuals who believe that they may have been victims of housing discrimination can call the Justice Department at 1-800-896-7743, e-mail the Justice Department at [email protected], or contact the Department of Housing and Urban Development at 1-800-66-9777 or through its website at https://www.hud.gov/program_offices/fair_housing_equal_opp. More information about the Civil Rights Division and the laws it enforces is available at www.justice.gov/crt.
Justice Department Requires Harris and L3 to Divest Harris’s Night Vision Business to Proceed with MergerRead the Press Release
The Department of Justice announced today that it is requiring Harris Corporation (Harris) and L3 Technologies Inc. (L3) to divest Harris’s night vision business in order to proceed with their merger.
The Department further said that, without the divestiture, the proposed acquisition would eliminate competition between the only two suppliers of U.S. military-grade image intensifier tubes, which are the key component in night vision devices such as goggles and weapon sights purchased by the Department of Defense (DoD) for the United States military.
The Justice Department’s Antitrust Division filed a civil antitrust lawsuit today in the U.S. District Court for the District of Columbia to block the proposed merger. At the same time, the Department filed a proposed settlement that, if approved by the court, would resolve the competitive harm alleged in the lawsuit.
“The merger, as originally structured, would have given the combined company a monopoly over image intensifier tubes, an essential component in night vision devices used by the United States military,” said Assistant Attorney General Makan Delrahim of the Justice Department’s Antitrust Division. “Today’s settlement will ensure that our armed forces continue to benefit from competition for a mission critical component that soldiers operating in low-light environments rely on every day.”
According to the Department’s complaint, Harris and L3 are the only suppliers of U.S. military-grade image intensifier tubes for night vision devices such as goggles and weapon sights that are purchased by the DoD. Image intensifier tubes are the critical component in these devices, which amplify visible light to increase situational awareness, threat detection, and mission performance of American soldiers and aircrews operating in low-light environments. The Department’s complaint alleges that competition between Harris and L3 has resulted in lower prices, higher quality, and shorter delivery times and has fostered innovation that has led to the development of image intensifier tubes with higher sensitivity and resolution. According to the complaint, the combination of Harris and L3 would leave the DoD without a competitive alternative for this critical input and likely result in higher prices, less favorable contract terms, and reduced research and development efforts.
Under the terms of the proposed settlement, Harris and L3 must divest Harris’s entire night vision business, including its manufacturing facility in Roanoke, Virginia, to an acquirer approved by the United States.
The Antitrust Division and the DoD cooperated closely throughout the course of their respective investigations of the transaction.
Harris is incorporated in Delaware and has its headquarters in Melbourne, Florida. Harris provides night vision devices and image intensifier tubes, tactical communications solutions, electronic warfare solutions, and space and intelligence systems. In 2018, Harris had sales of approximately $6.2 billion.
L3 is incorporated in Delaware and is headquartered in New York, New York. L3 provides night vision devices and image intensifier tubes; intelligence, surveillance, and reconnaissance systems; aircraft sustainment, simulation, and training; and security and detection systems. In 2018, L3 had sales of approximately $10.2 billion.
As required by the Tunney Act, the proposed settlement, 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 Maribeth Petrizzi, Chief, Defense, Industrials, and Aerospace Section, Antitrust Division, U.S. Department of Justice, 450 Fifth Street, N.W., 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 finding it is in the public interest.
Former District of Columbia Attorney Previously Found Guilty of $2 Million Investment Fraud Scheme Pleads Guilty to Not Filing Tax ReturnRead the Press Release
A former attorney recently convicted of securities fraud by a jury in the District of Columbia, pleaded guilty today to failure to file an income tax return and pay taxes, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division.
Brynee Baylor pleaded guilty today to one count of willfully failing to timely file a 2010 individual income tax return and to pay taxes. She admitted to causing a tax loss of $79,000.
On April 30, 2019, the jury convicted Baylor of one count of conspiracy to commit securities fraud, one count of securities fraud, and five counts of first-degree fraud under District of Columbia law.
According to court documents and the evidence presented at trial, Baylor, a former partner in the D.C. law firm Baylor & Jackson PLLC, conspired with a Pennsylvania man and his company, known as the Milan Group, to recruit investors to a purported trading program. Investors were promised extremely large profits in a short time with little or no risk.
In 2011, the Securities and Exchange Commission (SEC) sued Baylor and others for fraud in connection with the purported trading program.
Sentencing is scheduled for Sept. 12. Baylor faces a maximum sentence of one year in prison for the failure to file a tax return conviction, five years in prison for the conspiracy count, 20 years in prison for the securities fraud count, and 10 years in prison for each of the first-degree fraud counts. Baylor also faces a term of supervised release and monetary penalties.
Principal Deputy Assistant Attorney General Zuckerman thanked the SEC for its invaluable assistance and commended special agents of IRS-Criminal Investigation, who conducted the investigation, and Trial Attorneys Jeffrey McLellan and Eric Powers of the Tax Division, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
District of Columbia Development Company and Owner Plead Guilty to Crimes Related to Lead-Based PaintRead the Press Release
Mohammad Sikder, 60, of Washington, D.C., pleaded guilty today to two counts of violating the Toxic Substances Control Act for his role in renovating a Washington, D.C., property without following lead-safe work practices and lead disclosure requirements.
Sikder’s solely held company, District Properties LLC, also pleaded guilty to making false statements in 25 building permit applications to the District of Columbia Department of Consumer and Regulatory Affairs (DCRA). These applications understated the age of the homes being renovated, with the intent to avoid regulatory scrutiny of inadequate lead-based paint safety measures at those properties.
The Honorable Amy Berman Jackson scheduled sentencing for Nov. 22, 2019. The charges against Mr. Sikder carry a statutory maximum of twelve months in prison and potential financial penalties. He and the government will jointly recommend a $50,000 fine in addition to any prison time imposed. The company has agreed to pay a $150,000 criminal fine, and to put another $25,000 towards funding lead-based paint compliance trainings in the District of Columbia, Maryland, and Virginia.
“Lead poisoning is a major environmental health problem, and the deliberate actions taken by the defendant posed an unnecessary risk to his employees and the public at large,” said Assistant Attorney General Jeffrey Bossert Clark for the Justice Department’s Environment and Natural Resources Division. “The Department of Justice will not allow to go unchallenged such flagrant disregard for the rule of law and will continue to work with its partners to protect the health of communities here in Washington, D.C., and beyond.”
“By using unlicensed and untrained workers to renovate older buildings, the defendant threatened the health of his workers and the general public,” said Jennifer Lynn, Acting Special Agent in Charge for EPA’s Mid-Atlantic criminal enforcement program. “Today’s guilty pleas demonstrate that EPA and its partner agencies are committed to enforcing laws protecting public health.”
Lead poisoning continues to be a major environmental health problem in the United States, although it is completely preventable. The most common source of childhood lead poisoning is lead-based paint in older homes, and the primary exposure pathway is ingestion of lead-contaminated dust. Lead is a toxic substance that can cause permanent damage, and is regulated under the Toxic Substances Control Act. Under the Renovation, Repair and Painting Rule (RRP Rule), contractors performing renovation, repair and painting projects that disturb lead-based paint in homes, child care facilities, and schools built before 1978 must be certified and must follow specific work practices to prevent lead contamination.
According to a Statement of Offense filed along with the plea agreements, Sikder and District Properties LLC purchased and renovated a property in Washington, D.C., without following the requirements of the RRP Rule. In 2014, the company submitted a building permit application to DCRA for addition, alteration, and repair of the property. At Sikder’s instruction, the employee submitting the permit application, under the section of the application titled “Lead Abatement,” falsely indicated that the property was built after 1978. During the summer and fall of 2014, a contractor conducted demolition at the property without following RRP Rule safe work practices. The demolition work included removing windows, removing interior and exterior painted surfaces, and removing floor and ceiling joists.
A Sept. 24, 2015, Occupational Safety and Health Administration inspection revealed multiple hazards, including (1) employees performing manual demolition on a wall surface that had paint containing lead; (2) the lack of an employee exposure assessment to determine actual employee exposure; (3) the lack of lead training to employees; and (4) proper sanitation practices not being followed. Sampling analysis showed lead present on the dump truck and employees’ hands. When the property was properly remediated and sold, Sikder and District Properties LLC did not provide the purchasers this information and with a report documenting the prior existence of lead-based paint at the property.
Between 2011 and 2017, District Properties LLC submitted 25 renovation permit applications for properties in Washington, D.C., on which the company falsely represented that the properties had been built after 1978, thereby circumventing additional permitting requirements and avoiding EPA oversight with respect to RRP Rule compliance, which would be triggered by an accurate permit application.
In announcing the plea, Deputy Assistant Attorney General Williams and Acting Special Agent in Charge Lynn expressed appreciation for the work performed by Special Agent Allison Landsman from EPA-Criminal Investigations Division, in partnership with the Metropolitan Police Department Environmental Crimes Unit. The case is being prosecuted by Trial Attorney Cassandra J. Barnum of the Environmental Crimes Section.
Joint EU-US Statement Following the EU-US Justice and Home Affairs Ministerial MeetingRead the Press Release
On June 19, 2019, the Romanian Presidency of the Council of the European Union hosted the EU-US Ministerial Meeting on Justice and Home Affairs in Bucharest, Romania. The meeting provided an opportunity for both sides to take stock of their long-standing cooperation in this area and to reaffirm their partnership in addressing common security threats. U.S. Attorney General William P. Barr and Acting Deputy Secretary for Homeland Security David P. Pekoske represented the United States.
The European Union hosted the meeting and was represented by the Commissioner for Migration, Home Affairs and Citizenship Dimitris Avramopoulos; the Commissioner for Justice, Consumers and Gender Equality Věra Jourová; the Commissioner for the Security Union Julian King; as well as the Romanian Vice Prime Minister ad interim and Minister of Justice Ana Birchall and the Minister of Interior Carmen Daniela Dan, together with the Finnish Minister of the Interior Ms. Maria Ohisalo and the Minister of Justice Ms. Anna-Maja Henriksson, on behalf of the current and incoming Presidencies of the Council of the European Union.
The United States and the European Union reaffirmed that fighting terrorism is among their top priorities and committed to enhance their joint efforts, including by expanding the sharing of information gathered in zones of combat for use in investigations and prosecutions. Participants welcomed results already achieved in this domain, including in cooperation with Europol and Eurojust, and looked forward to the outcome of the meeting to be held on this subject that will bring together U.S. and EU experts in Brussels on July 10. With regard to other critical areas of EU-US information sharing, participants of the meeting reiterated the importance of the EU-US Passenger Name Record agreement and committed to begin a joint evaluation to assess its implementation. The United States and the European Union also discussed current threats to aviation security, including unmanned aircraft systems; combatting the use of the internet for terrorist purposes; and chemical, biological, radiological and nuclear threats.
The United States and the European Union also discussed the priority area of security in cyberspace. Participants committed to further joint efforts to maintain a safe, open, and secure cyberspace, and exchanged views on how to best address growing cyber threats. Participants recognized that the deployment of 5G network infrastructure needs to be addressed as a matter of priority, as it might pose significant security risks and impact the ability of law enforcement agencies to take effective action against crime. The United States and the European Union are committed to further pursue their exchanges on assessing and managing 5G and supply chain security risks through existing channels, including the Justice and Home Affairs meetings. The United States and the European Union also recognized the importance of swift cross-border access to electronic evidence, and discussed the implications of recent legislation enacted in the United States and legislation under examination in the European Union.
Participants acknowledged the recent approval by the Council of the European Union of a mandate authorizing the Commission to negotiate on behalf of the EU an agreement with the United States facilitating access to e-evidence for the purpose of judicial cooperation in criminal matters, as well as the steps being taken by the United States towards opening negotiations of such an agreement, in a manner consistent with their respective legislations. The United States and the European Union also reviewed the unprecedented challenges faced by electoral systems in democratic states, which call for exchanges of best practices to overcome those challenges. Participants confirmed their commitment to further discuss an expert level dialogue.
The United States and the European Union briefed each other on recent developments in their migration and border management policies; in particular, the European Union provided information on the reinforced mandate of the European Border and Coast Guard Agency (EBCGA) and on the implementation of the European Travel Information and Authorization System (ETIAS), two instruments which will further strengthen the EU's border management. Both sides concurred on the vital importance of preventing and combatting migrant smuggling and trafficking of human beings and discussed further joint work in these areas.
Finally, the United States and the European Union agreed on the importance of advancing further towards reciprocal visa free travel under their respective legal frameworks and, following the May 2019 meeting on visa reciprocity between the United States, the European Union and the concerned Member States, welcomed the progress of the five concerned Member States towards meeting the requirements of the Visa Waiver Program, in order to be considered for designation in the program.
Reaffirming their commitment to advance together towards common solutions in these areas, the United States and the European Union committed to meet again in the second half of 2019 in Washington, D.C.
The meeting was also attended by the EU Counter-Terrorism Coordinator Gilles de Kerchove, the Executive Director of Europol Catherine De Bolle, the Executive Director of Frontex Fabrice Leggeri and the Vice-President of Eurojust Klaus Meyer-Cabri.
Statement of the Department of Justice Antitrust Division on the Closing of Its Investigation of the Louisiana Health Service & Indemnity Co.–Vantage Holdings Inc. MergerRead the Press Release
Assistant Attorney General Makan Delrahim of the Antitrust Division of the U.S. Department of Justice issued the following statement today in connection with the closing of the Division’s investigation into the proposed acquisition of Vantage Holdings, Inc. (Vantage) by Louisiana Health Service & Indemnity Co. d/b/a Blue Cross Blue Shield of Louisiana (Blue Cross):
“After a thorough investigation of the proposed transaction, and after working with the Louisiana Attorney General’s office and the Louisiana Department of Insurance, the Antitrust Division determined that the combination of Blue Cross and Vantage is unlikely to result in harm to American consumers.”
In October 2018, the parties announced that Blue Cross would acquire a majority ownership in Vantage. The Louisiana Department of Insurance held a public hearing and approved the transaction in December 2018, contingent upon the Antitrust Division’s approval.
The Antitrust Division conducted a comprehensive seven-month investigation, during which it reviewed documents, analyzed data, took testimony, and interviewed industry participants. In particular, the Division analyzed whether the merger would substantially lessen competition in the sale of health plans sold to individuals on the public exchange established by the Affordable Care Act or health plans sold to individuals off of the public exchange. Multiple types of evidence indicated that the merger is unlikely to harm consumers in the sale of on-exchange or off-exchange commercial individual health insurance plans. Vantage’s membership in these products has been rapidly declining in recent years. Moreover, Vantage has set premiums significantly higher than comparable Blue Cross products, and Vantage therefore does not appear to have a competitive impact on Blue Cross product pricing. In New Orleans, for example, the price of the lowest-cost Vantage silver plan in 2019 is greater than 60 percent more expensive than the lowest-cost Blue Cross silver plan (i.e., the plan with the most widely selected level of coverage), a price gap that has widened substantially in recent years.
For these and other reasons, the Division determined that the transaction is unlikely to harm consumers and therefore closed its investigation.
Former CEO of Two U.S. Government Contractors Pleads Guilty to Falsifying Government DocumentsRead the Press Release
The former CEO of two U.S. government contractors pleaded guilty today to falsifying documents in an effort to increase his companies’ competitiveness, announced Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and Special Inspector General for Afghanistan Reconstruction John F. Sopko.
James O’Brien, 46 of Fredericksburg, Virginia, pleaded guilty to four counts of making false statements before U.S. Magistrate Judge Sean P. Flynn of the Middle District of Florida. Sentencing has not yet been scheduled.
As part of his guilty plea, O’Brien admitted that from 2013 to 2015 he was CEO of Tamerlane Global Services (Tamerlane) and Artemis Global (Artemis), both of Fairfax County, Virginia. During this time period, Tamerlane and Artemis worked on a logistics contract issued by the U.S. Transportation Command (TRANSCOM) that supported the U.S. war effort in Afghanistan. Tamerlane and Artemis employees, including O’Brien, deployed to Afghanistan as part of the contract.
Contractors deployed to Afghanistan must have with them letters of authorization (LOAs) issued by the government agency responsible for the deployment. The LOAs serve as the contractors’ authorization to be deployed to Afghanistan, and set forth the U.S. government-provided benefits, such as military air travel, that the contractors may utilize at no cost while deployed. LOAs that authorize U.S. government benefits are known as “provisioned LOAs,” and are factored into the cost of a contract.
O’Brien admittedly altered the un-provisioned LOAs, including his own, that TRANSCOM issued to deploying Tamerlane and Artemis employees to make the LOAs appear as if they were provisioned. He gave the LOAs that he altered to his deploying employees, who used them to utilize government provided benefits in Afghanistan at no cost, O’Brien admitted.
This case was investigated by the Special Inspector General for Afghanistan Reconstruction. The case is being prosecuted by Trial Attorney Michael P. McCarthy of the Criminal Division’s Fraud Section.
Environment and Natural Resources Division Releases Accomplishments Report for FY2018Read the Press Release
Today, the Department of Justice’s Environment and Natural Resources Division (ENRD) released its Accomplishments Report for Fiscal Year (FY) 2018. The report, which is published annually by ENRD, highlights the division’s strong enforcement of our nation’s environmental laws, defense of government programs that strengthen the country’s energy independence and national security, and close collaboration with states and tribes.
“I am pleased to share the 2018 accomplishments of the Environment and Natural Resources Division of the United States Department of Justice,” said Assistant Attorney General Jeffery Clark. “The Division achieved many impressive enforcement successes in fiscal year 2018, and I am immensely proud of the hard work of our extraordinary and dedicated attorneys and staff who made these accomplishments possible. I look forward to continuing the important work of the Division in achieving our mission together in 2019 and beyond.”
This year, ENRD focused on several key objectives: vigorously enforcing the pollution abatement and wildlife protection laws of the United States, particularly in cases involving fraud or abuse; promoting energy independence and economic growth by defending the reduction of regulatory burdens and supporting infrastructure development; strengthening national security and border protection; promoting cooperative federalism; and protecting the public fisc.
In fiscal year 2018, ENRD worked on approximately 3,800 cases and matters, while maintaining a robust docket of over 6,750 cases and matters. The Division obtained over $260 million in civil and criminal fines, penalties, and costs recovered. The estimated value of federal injunctive relief obtained — including cleanup and pollution-prevention actions funded by private parties — exceeded $3.3 billion.
ERND defended legal challenges to the Trump Administration’s energy policies and regulatory reform agenda. By defending the actions of our client agencies, the Division plays a critical role in paving the way for infrastructure and energy security projects that will strengthen the U.S. economy and facilitate border control and military operations to protect our national security.
In addition, the Division secured 30 CERCLA (Comprehensive Environmental Response, Compensation, and Liability Act) settlements and judgments. The settlements and judgments brought on behalf of the United States Environmental Protection Agency (EPA) obtained clean-up work estimated to cost more than $170 million and over $88 million in costs previously expended by EPA. For example, the consent decree in United States v. Doe Run Resources Corporation (E.D. Mo.), a settlement signed by the United States, the State of Missouri, and the Doe Run Resources Corporation, requires the company to excavate lead-contaminated soil on approximately 4,100 affected residential properties.
ENRD continued its successful efforts to ensure the integrity of the renewable fuels program through prosecutions of companies that knowingly cheat the federal treasury and the American public through the sale of fraudulent Renewable Identification Numbers (RINs), credits that reflect a volume of renewable fuel manufactured. The Division added to its success in 2018 by convicting four defendants who were sentenced to lengthy prison terms (totaling 279 months of imprisonment) and ordered to pay over $65 million in restitution and forfeit $12.5 million for various multistate schemes to defraud RIN buyers and U.S. taxpayers.
“I am committed to continuing the good work of our Division, defending the rule of law, and promoting the President’s agenda of regulatory reform. We will fairly enforce our Nation’s environmental laws, focusing on bad actors who aim to get an advantage over others by cheating the system,” Assistant Attorney General Clark added.
The report also recognizes the important contributions of ENRD’s front office leadership: Principal Deputy Assistant Attorney General Jonathan Brightbill; Deputy Assistant Attorneys General Jean Williams, Bruce Gelber, Eric Grant, and Lawrence VanDyke; and Counsel and Chief of Staff Corinne Snow.
Justice Department Reaches Settlement with Five Additional Broadcast Television Companies, Including One National Sales Representative Firm, in Ongoing Information Sharing InvestigationRead the Press Release
The Department of Justice announced today that it has reached settlements with CBS Corporation (CBS), Cox Enterprises Inc. (Cox), The E.W. Scripps Company (Scripps), Fox Corporation (Fox), and TEGNA Inc. (TEGNA) to resolve a Department lawsuit brought as part of its ongoing investigation into exchanges of competitively sensitive information in the broadcast television industry.
All five companies are alleged to have engaged in unlawful information sharing among their owned broadcast television stations. Cox also owns Cox Reps, one of two large “Rep Firms” in the industry that assist broadcast stations in sales to national advertisers. The Rep Firms are alleged to have participated in the unlawful information sharing conduct.
“The Antitrust Division’s efforts to protect competition in the television broadcast industry continue with today’s settlements that will stop the unlawful exchange of competitively sensitive information among rival broadcasters and their sales rep firms,” said Assistant Attorney General Makan Delrahim of the Department of Justice’s Antitrust Division. “Vigorous competition among broadcast stations allows American businesses across the country to obtain competitive advertising rates. The unlawful sharing of information reduced that competition and thereby harmed businesses that rely on competitive rates to best serve their customers.”
The Department filed a second amended complaint today in the case United States v. Sinclair Broadcast Group, Inc., et al., adding CBS, Cox, Scripps, Fox, and TEGNA as defendants. At the same time, the Department filed proposed settlements with CBS, Cox, Scripps, Fox, and TEGNA that, if approved by the court, would resolve the competitive harm alleged in the complaint. The Department filed its original complaint in the case on Nov. 13, 2018, along with proposed settlements with six other television broadcasting companies. On Dec. 13, 2018, the Department filed an amended complaint and a proposed settlement with a seventh television broadcasting company. The court entered final judgment against all seven of those defendants on May 22, 2019.
According to the amended complaint, CBS, Cox, Scripps, Fox, and TEGNA agreed with other entities in many metropolitan areas across the United States to exchange revenue pacing information, and also engaged in the exchange of other forms of non-public sales information in certain metropolitan areas. The complaint further alleges that Cox Reps also facilitated and participated in this exchange of pacing information by its broadcast-station clients that operated in the same metropolitan areas. Pacing compares a broadcast station’s revenues booked for a certain time period to the revenues booked in the same point in the previous year. Pacing indicates how each station is performing versus the rest of the market and provides insight into each station’s remaining spot advertising for the period.
By exchanging pacing information, the five new defendants and other broadcasters were better able to anticipate whether their competitors were likely to raise, maintain, or lower spot advertising prices, which in turn helped inform their stations’ own pricing strategies and negotiations with advertisers. As a result, the information exchanges harmed the competitive price-setting process in markets for the sale of spot advertisements.
The Department recognizes and commends each of these new defendants for their cooperation with the Antitrust Division in bringing these issues to settlement. In particular, Fox assisted in the expeditious resolution of the Division’s investigation, even though Fox’s relevant conduct of which the Division is currently aware appears to have occurred before Fox’s spin-off from the recently merged Walt Disney Company and 21st Century Fox.
The proposed settlements with CBS, Cox, Scripps, Fox, and TEGNA prohibit the direct or indirect sharing of such competitively sensitive information. Additionally, the Department’s proposed settlement with Cox requires that Cox Reps implements firewalls in markets where it represents more than one broadcast station. The Department has determined that these provisions would resolve the antitrust concerns raised as a result of the defendants’ alleged conduct. The proposed settlements further require these five defendants to adopt rigorous antitrust compliance and reporting measures to prevent similar anticompetitive conduct in the future. The settlements have a seven-year term, and they will continue to apply to stations currently owned by CBS, Cox, Scripps, Fox, and TEGNA even if those stations are acquired by another company. Finally, the settlements require that the five defendants cooperate in the Department’s ongoing investigation.
CBS is a Delaware corporation with headquarters in New York, New York. It owns or operates 28 television stations across 18 markets and had revenues in excess of $14.5 billion in 2018.
Cox is a Delaware corporation with headquarters in Atlanta, Georgia. It owns or operates 14 television stations across 10 markets, owns Cox Reps, and had an estimated $20 billion in revenues in 2018.
Scripps is an Ohio corporation with headquarters in Cincinnati, Ohio. It owns or operates 60 television stations across 42 markets, and had over $917 million in revenues in 2018.
Fox is a Delaware corporation with headquarters in New York, New York. Fox owns or operates 17 television stations across 17 markets. Fox is a corporate entity that was formed after The Walt Disney Company acquired 21st Century Fox and spun-out certain former 21st Century Fox assets, including its broadcast station assets. The television segment of 21st Century Fox had over $5 billion in revenues in 2017.
TEGNA is a Delaware corporation with headquarters in McLean, Virginia. It owns or operates 49 television stations in 41 markets, and had $2.2 billion in revenues in 2018.
As required by the Tunney Act, the proposed settlements, along with the Department’s competitive impact statement, will be published in the Federal Register. Any person may submit written comments concerning the proposed settlements within 60 days of their publication to Owen Kendler, Chief, Media, Entertainment, and Professional Services Section, Antitrust Division, U.S. Department of Justice, 450 Fifth Street, N.W., Suite 4000, Washington, D.C. 20530. At the conclusion of the 60-day comment period, the court may enter the final judgments upon a finding that they serve the public interest.
Former Military Serviceman Charged with Aggravated Sexual AbuseRead the Press Release
Federal Agents Arrested A Louisiana Man And Former Member Of The United States Navy Stationed In Japan, Relating To A 2004 sexual assault. The arrest was based on a two-count indictment returned Friday by a federal grand jury in New Orleans.
Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and U.S. Attorney Peter G. Strasser of the Eastern District of Louisiana made the announcement.
Travis Lamont Murray, 36, from Jefferson Parish, Louisiana, is charged with one count of aggravated sexual abuse and one count of sexual abuse. He had his initial court appearance Friday before U.S. Magistrate Judge Dana M. Douglas for the Eastern District of Louisiana.
The indictment alleges that on or about the late evening hours of May 25, 2004, and the early morning hours of May 26, 2004, in Yokosuka City, Japan, Murray did knowingly cause a victim to engage in a sexual act by the use of force and by threatening and placing the victim in fear that she would be subjected to death and serious bodily injury. Murray was identified as the assailant after a DNA sample of his was submitted to the FBI’s Combined DNA Index System (CODIS) by the Jefferson Parish Sheriff’s Office during an unrelated investigation in 2018 and was determined to be consistent with a DNA profile obtained during the sexual assault investigation previously entered into CODIS.
All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
The investigation was conducted by the U.S. Naval Criminal Investigative Service. The prosecution is being handled by Senior Trial Attorney Frank Rangoussis of the Criminal Division’s Human Rights and Special Prosecutions Section and Assistant U.S. Attorney Kathryn McHugh of the Eastern District of Louisiana.
Federal Court Permanently Enjoins Plaquemines Parish Tax Return Preparer and BusinessRead the Press Release
The United States District Court for the Eastern District of Louisiana entered a permanent injunction barring Jessica Barthelemy St. Ann and JJSM Inc., from preparing federal tax returns.
The government’s complaint alleged that St. Ann knowingly took unreasonable positions on returns she prepared that result in understatements of the tax her customers owe or overstatements of the refunds to which they are entitled to receive. For example, the complaint alleged that St. Ann prepared returns which claimed erroneous car and truck expenses for some customers, intentionally and improperly understating the tax that the customers owed. According to the complaint, St. Ann also repeatedly prepared Schedules C improperly claiming business losses from activities that her customers engaged in purely as hobbies.
St. Ann agreed to the entry of the permanent injunction without admitting any factual allegations in the complaint.
Return preparer fraud is one of the IRS’ Dirty Dozen Tax Scams and taxpayers seeking a return preparer should remain vigilant. The IRS has information on its website about selecting a return preparer and has launched a free directory of federal tax preparers.
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.
Attorney General William P. Barr Appoints Katharine Sullivan to be Principal Deputy Assistant Attorney General for the Office of Justice Programs and Announces that Laura L. Rogers Will Serve as the Acting Director of the Office on Violence Against WomenRead the Press Release
WASHINGTON – Attorney General William P. Barr today announced that he has appointed Katharine Sullivan to serve as the Principal Deputy Assistant Attorney General for the Justice Department’s Office of Justice Programs and that Laura L. Rogers will serve as the Acting Director of the Office on Violence Against Women (OVW).
“Katie Sullivan has been an energetic and great leader of the Office on Violence Against Women, and I am confident she will bring the same enthusiasm to the Office of Justice Programs,” said Attorney General Barr. “Katie’s leadership will further enhance the department’s efforts to strengthen public safety and the criminal justice system through research, programs and strategies, and to provide critical services to victims of crime.”
Katharine (Katie) Sullivan has served as the Acting Director of OVW since January 2018. Prior to joining OVW, Ms. Sullivan was appointed in 2007 to the Colorado state trial court bench where she presided over misdemeanor, felony and civil matters including domestic violence, sexual assault sentencings, cases involving drugs and alcohol, and jury trials. Ms. Sullivan implemented and presided over a drug court and a driving under the influence (DUI) court, leading two multidisciplinary teams. Prior to becoming a Judge, Ms. Sullivan served as a Deputy District Attorney in Colorado, prosecuting all types of felony and misdemeanor cases, worked closely with law enforcement and participated in a community based collaborative domestic violence task force. While in private practice, she served on the Victim Compensation Board. Ms. Sullivan also trained law enforcement nationwide regarding risk and liability in jails and prisons. She also served on the State Judicial Ethics Board.
Laura L. Rogers to serve as Acting OVW Director
Also today, Attorney General Barr announced that Laura L. Rogers will lead the Office on Violence Against Women. OVW leads federal efforts to reduce violence against women and administer justice for and strengthen services to victims of domestic violence, dating violence, sexual assault, and stalking.
Ms. Rogers has served as Director of the Office of Sex Offender Sentencing, Monitoring, Apprehending, Registering, and Tracking (SMART Office), in the Office of Justice Programs since January 2018. As the SMART Director, Ms. Rogers led the SMART staff in administering the standards of the Sex Offender Registration and Notification Act (SORNA).
“Laura Rogers has a distinguished history serving the cause of justice for victims of sexual abuse and preventing future abuse,” said Attorney General Barr. “Among her many accomplishments, Laura was appointed by President George W. Bush to be the founder of the SMART office and has been a pioneer in developing the sex offender registration and notification systems that today deny known sex offenders anonymity and help keep children and adults safe across America.”
Prior to coming to the Department, Ms. Rogers served on the National Review Board of the U.S. Conference of Catholic Bishops as well as the Philadelphia Archdiocese Review Board on Sexual Abuse and Pastoral Conduct. Ms. Rogers also served as deputy director of the Criminal Law Division of the U.S. Navy's Office of the Judge Advocate General. Ms. Rogers began her legal career in 1988 as a criminal prosecutor in the San Diego County District Attorney’s Office.
Second New York Broker-Dealer Pleads Guilty to Rigging Bids for Financial Instruments in Violation of Antitrust LawRead the Press Release
Industrial and Commercial Bank of China Financial Services LLC (ICBCFS) pleaded guilty to an antitrust charge and was sentenced to pay a criminal fine in excess of $3 million for its involvement in a bid-rigging conspiracy involving certain financial instruments, the Department of Justice announced today.
ICBCFS admitted, as part of a guilty plea, that from May 2012 until at least August 2014, it conspired with other institutions and individuals to submit rigged bids to borrow pre-release American Depository Receipts (ADRs). ICBCFS’s plea is the second in the ongoing criminal antitrust investigation; Banca IMI Securities Corp. previously pleaded guilty for its role in the conspiracy and was sentenced to pay a fine in excess of $2 million on May 10, 2019.
Worldwide, thousands of publicly traded companies list their shares of common stock only on foreign stock exchanges. Most U.S. investors are unable to purchase or sell such foreign shares. The U.S. Securities and Exchange Commission, however, permits four U.S. depository banks to create ADRs, which represent foreign ordinary shares and can be traded in the United States. Through the purchase and sale of ADRs, U.S. investors are able to gain exposure to — including the ability to receive dividends from — companies whose common stock is listed only on foreign stock exchanges.
ICBCFS pleaded guilty to conspiring to borrow pre-release ADRs from U.S. depository banks at artificially suppressed rates. During the conspiracy, a U.S. depository bank began using an auction-style process and invited ICBCFS and other broker-dealers to submit competitive bids for rates to borrow ADRs. In response, ICBCFS and its co-conspirators intensified their coordination in an effort to artificially increase their profits under the auction-style process. On at least 24 occasions, ICBCFS reached an agreement with one or more co-conspirators as to the bids they would submit to U.S. depository banks. On many occasions, the conspirators agreed that they would all submit the same bid.
“In today’s proceeding, the Department of Justice and its law enforcement partners held to account another broker-dealer for its role in suppressing competition and rigging bids in the financial services industry,” said Assistant Attorney General Makan Delrahim of the Justice Department’s Antitrust Division. “The competitive integrity of financial markets is essential to their efficient operation, and the Antitrust Division will continue to aggressively prosecute collusion that corrupts our financial markets.”
“As evidenced by this latest guilty plea, the FBI’s investigation into big ridding for ADRs is broad and deep,” said Assistant Director Robert Johnson of the FBI’s Criminal Investigative Division. “Not only are we bringing the conspirators to justice, we are sending a message to the entire financial industry: you are not above the law. The FBI can and will investigate bid rigging and all fraudulent schemes. You will be caught.”
“This guilty plea is an example of the FBI’s commitment to investigating companies when they operate outside the law and conspire to cheat and dominate the marketplace,” said FBI Washington Field Office, Acting Assistant Director in Charge, John P. Selleck. “I would like to thank the FBI agents and analysts who have worked on this complex investigation and are committed to holding those companies accountable who disregard the rule of law for their own financial gain.”
The Securities and Exchange Commission also separately announced today that ICBCFS has agreed to settle charges that it violated federal securities laws by improperly handling pre-release ADRs.
The Washington Criminal II Section of the Antitrust Division and the FBI’s International Corruption Squad in Washington, D.C. are conducting the investigation into bid rigging in the market for pre-release ADRs. 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 www.justice.gov/atr/contact/newcase.html.
Prosecutors from the United States, Colombia and Mexico Strengthen Their Commitment to Dismantling Transnational Criminal OrganizationsRead the Press Release
On June 12 to 14, in Cartagena, Colombia, prosecutors from Colombia, Mexico, and the United States came together for the second Transnational Criminal Organizations (TCO) Working Group. The mission of the Working Group is to engage in specialized training and to develop joint strategies and best practices to dismantle the transnational criminal organizations that threaten the three nations.
During the Working Group, experienced prosecutors from the three nations benefited from trainings on international judicial cooperation and money laundering, and began developing a road map for the development or dissemination of best practices and effective strategies to dismantle these dangerous enterprises. This effort is all the more critical given the increasing interconnectedness between Mexican cartels and Colombian drug trafficking organizations, which collaborate to improve their profits and ability to traffic narcotics, humans, weapons and other contraband into the United States, threatening its national security.
The TCO Working Group is a direct outgrowth of Presidential Executive Order 13773 – Enforcing Federal Law with Respect to Transnational Criminal Organizations and Preventing International Trafficking – which recognized the threat that transnational criminal organizations, including transnational drug cartels, pose to the national security of the United States. In the Executive Order, President Trump prioritized the need to increase cooperation and information sharing with foreign counterparts, and to enhance their operational capabilities via increased security sector assistance, all with the goal of dismantling TCO. Since the 2017 Executive Order was issued, the President has continually reiterated the need to immediately attack the ability of these organizations to traffic narcotics and other criminality into the United States.
The U.S. Department of Justice’s Office of Overseas Prosecutorial Development, Assistance and Training (OPDAT), which is housed under the Department’s Criminal Division, seized on the momentum from the Dec. 6 to 7, 2017 “Trilateral Summit Against Transnational Organized Crime,” to spearhead the TCO Working Group. The Attorneys General from the United States, Mexico and Colombia converged at the Trilateral Summit to strengthen their commitment to international judicial cooperation and to reinforce joint strategies to dismantle transnational organized crime, such as narcotics trafficking, money laundering, and public corruption. Via a Joint Declaration, the three Attorneys General called on their respective institutions to increase the exchange of best practices to effectively dismantle TCO and to develop joint capacity building and training programs for those charged with investigating and prosecuting TCO. With this clear mandate, OPDAT Colombia and OPDAT Mexico sponsored the first TCO Working Group in August 2018 in Mexico City, Mexico.
Participating in the TCO Working Group meeting was U.S. Attorney Maria Chapa Lopez for the Middle District of Florida; representatives of the Fiscalía General de la Nación (FGN) of Colombia including Claudia Carrasquilla, head of the National Organized Crime Unit and Ricardo Carriazo, head of the National Drug Trafficking Unit of FGN; representatives of the Fiscalía General de la República (FGR) of Mexico, OPDAT Resident Legal Advisors (RLAs) in Colombia and México and Assistant U.S. Attorneys from the federal districts of Arizona, Southern District of California, Middle District of Florida, Southern District of Florida, Northern District of Georgia, District of New Jersey, District of New Mexico, Eastern District of Texas, Southern District of Texas, Western District of Texas and District of Utah; trial attorneys from the Criminal Division’s Money Laundering and Asset Recovery Section and representatives from the Criminal Division’s International Criminal Investigative Training and Assistance Program (ICITAP); the U.S. Drug Enforcement Administration (DEA); U.S. Customs and Border Protection; U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) and the Colombian National Police.
“Global cooperation is the key to mitigating threats to our national security and thwarting borderless crimes,” said U.S. Attorney Maria Chapa Lopez for the Middle District of Florida. “The OPDAT Program continues to provide us, and our international partners, with the vital tools, information, and resolve necessary to defeat criminals, wherever they operate.”
"We held the trilateral meeting between the U.S., Colombian and Mexican prosecutors, where we've discussed issues of absolute importance for the dismantling of transnational criminal organizations that affect the national security of our countries,” said Ricardo Carriazo, Director of the Special Unit against Drug Trafficking for the Colombian Attorney General’s Office. “The results in this exchange of experiences and good practices will be seen soon in the development of international judicial operations. "
OPDAT spearheads and organizes this critical event in coordination with the U.S. Department of State’s Bureau of International Narcotics and Law Enforcement Affairs (INL).
For photos of this event, please see here.
Massachusetts Chiropractor Pleads Guilty to Tax EvasionRead the Press Release
The owner of a chiropractic business pleaded guilty today to tax evasion, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division.
According to an indictment filed in June 2018, Richard Rogers, a Northborough, Massachusetts, chiropractor, operated his practice from his residence. Rogers was charged with evading his taxes from 2012 through 2016 by concealing his income from the Internal Revenue Service (IRS) through a variety of methods. Rogers encouraged his clients to pay in cash, used a nominee bank account to negotiate check payments when he was not paid in cash, paid creditors using postal money orders, and used credit card accounts opened with a fictitious social security number. Rogers also concealed the ownership of his residence by titling the property in the name of a trust. Rogers did not file federal tax returns from at least 2008 through 2016, despite his obligation to do so.
United States District Judge Timothy S. Hillman scheduled sentencing for Sept. 10, 2019. Rogers faces a maximum sentence of five years in prison, three years of supervised release, and monetary penalties.
Principal Deputy Assistant Attorney General Zuckerman thanked special agents of IRS-Criminal Investigation, who conducted the investigation, and Assistant Chief John N. Kane and Trial Attorney Carl F. Brooker of the Tax Division, who are prosecuting the case.
Additional information about the Tax Division’s enforcement efforts can be found on the division’s website.
Justice Department Celebrates Strong Support for Religious Freedom at One Year Mark of the Place to Worship InitiativeRead the Press Release
The Department of Justice today announced the one-year anniversary of its Place to Worship Initiative, which focuses on protecting the rights of religious individuals and communities to build, expand, buy, or rent houses of worship and other religious facilities as guaranteed by the Religious Land Use and Institutionalized Persons Act (RLUIPA).
“The Department of Justice has prioritized protecting religious freedom, and the successes we have achieved under the Place to Worship Initiative in just one year demonstrate the strength of that commitment,” said Assistant Attorney General Eric Dreiband. “The Civil Rights Division will continue to enforce vigorously the laws that defend the fundamental freedom of religion, and we are pleased that this initiative has allowed the Department to continue this important work on behalf of many different and diverse religious groups.”
Since launching the initiative last June, the Civil Rights Division has doubled the number of RLUIPA investigations to 15, compared to the average of seven investigations per year from 2010 – 2016. A majority of investigations result in a resolution, or settlement, without a lawsuit. Since the initiative began, the Justice Department has resolved 10 RLUIPA investigations.
Moreover, since the start of the initiative, the Department filed a lawsuit against the Borough of Woodcliff Lake, New Jersey, alleging that the borough violated RLUIPA when its zoning board denied zoning approval to allow the Valley Chabad, an Orthodox Jewish congregation, to build a new place of worship on its land. The Department also filed suit against and reached an agreement with the City of Farmersville, Texas, to resolve allegations that the city violated RLUIPA when it denied an application by the Islamic Association of Collin County to build a cemetery.
Since the initiative began, the Department has also actively participated in RLUIPA lawsuits filed by private parties around the country. The Department has filed four Statements of Interest supporting RLUIPA plaintiffs in federal district courts, including: Hope Lutheran Church v. City of St. Ignace, Christian Fellowship Centers of New York, Inc. v. Village of Canton, Ramapough Mountain Indians, Inc. v. Township of Mahwah, and Jagannath Organization for Global Awareness v. Howard County. These cases have involved such diverse issues as the ability of churches in New York and Michigan to locate in business districts, the right of Ramapough Mountain Indians to use land for religious assembly in New Jersey, and the right of a Hindu congregation to build a temple in Maryland. The Department also filed an amicus brief and presented oral argument in the United States Court of Appeals for the Fourth Circuit supporting an Evangelical church’s RLUIPA claim against Baltimore County, Maryland. The Fourth Circuit ultimately agreed with the Department’s position that the small congregation, many of whose members are African immigrants, could proceed with its claim that the county improperly denied approval to build a small church on a 1.2-acre lot.
Finally, as part of the Place to Worship Initiative, the Department has launched a new website and complaint portal, provided informational materials for religious leaders and municipal officials, and held 15 community outreach and training events to raise awareness about RLUIPA across the country.
The Department of Justice announced the creation of the Religious Liberty Task Force in July 2018. The Task Force helps the Department fully implement the religious liberty guidance by ensuring that all Justice Department components are upholding that guidance in the cases they bring and defend, the arguments they make in court, the policies and regulations they adopt, and how we conduct our operations.
RLUIPA is a federal law that protects religious institutions from unduly burdensome or discriminatory land use regulations. More information about RLUIPA is available on the Place to Worship Initiative homepage, https://www.justice.gov/crt/place-worship-initiative.
Justice Department Announces New Transnational Elder Fraud Strike ForceRead the Press Release
Attorney General William P. Barr today announced the establishment of the Transnational Elder Fraud Strike Force, a joint law enforcement effort that brings together the resources and expertise of the Department of Justice’s Consumer Protection Branch, the U.S. Attorneys’ Offices for six federal districts, the FBI, the U.S. Postal Inspection Service, and other organizations. The Strike Force will focus on investigating and prosecuting individuals and entities associated with foreign-based fraud schemes that disproportionately affect American seniors. These include telemarketing, mass-mailing, and tech-support fraud schemes.
The Transnational Elder Fraud Strike Force will be comprised of prosecutors and data analysts from the Consumer Protection Branch, prosecutors with six U.S. Attorneys’ Offices (Central District of California, Middle and Southern Districts of Florida, Northern District of Georgia, Eastern District of New York, Southern District of Texas), FBI special agents, Postal Inspectors, and numerous other law enforcement personnel. The Strike Force will also collaborate with the Federal Trade Commission and industry partners, who have pledged to engage with the Department to help end the scourge of elder fraud. It will further benefit from the help of the Elder Justice Coordinators now assigned in every U.S. Attorney’s Office.
“Fraud against the elderly is on the rise,” said Attorney General Barr. “One of the most significant and pernicious causes for this increase is foreign-based fraud schemes. The new Transnational Elder Fraud Strike Force will bring together the expertise and resources of our prosecutors, federal and international law enforcement partners, and other government agencies to better target, investigate, and prosecute criminals abroad who prey on our elderly at home. The Department of Justice is committed to ending the victimization of elders across the country.”
“It doesn’t matter where these criminals live. We’re committed to keeping our elderly citizens safe, whether they’re being targeted door-to-door, over the phone, or online, from thousands of miles away,” said Director Christopher Wray of the FBI. “Our new Transnational Elder Fraud Strike Force will give us additional resources and tools to identify and stop those who are targeting our senior communities from overseas. If you think you may be a victim of elder fraud, or you know someone who is, please let us know. We want to help.”
“Protecting older Americans and educating them and their caregivers about foreign lotteries and sweepstakes has been a long-time priority of the Postal Inspection Service,” said Chief Postal Inspector Gary Barksdale. “Our consumer awareness programs, coupled with our investigative efforts, have prevented countless older Americans from fraud and financial exploitation. But there’s so much more than can be done. By joining our partner agencies in this Strike Force, we become more effective at identifying and stopping those who prey on our vulnerable citizens.”
Using analytical tools and sophisticated investigative approaches, the Strike Force will seek to identify those responsible for foreign fraud schemes affecting American seniors, as well as those individuals and entities facilitating such schemes. The Strike Force will coordinate closely with foreign law enforcement, and will use all available criminal and civil tools to stop victims from losing money and to hold wrongdoers responsible.
The Attorney General announced creation of the Strike Force as part of a week of events recognizing World Elder Abuse Awareness Day on June 15, which is dedicated to raising awareness about the millions of older adults who experience elder abuse, neglect, and financial exploitation.
The establishment of the Transnational Elder Fraud Strike Force builds on the Trump Administration’s commitment to combating elder fraud. That commitment was reflected in the Department’s historic 2018 and 2019 Elder Fraud Sweeps—which collectively brought criminal and civil actions against more than 500 defendants responsible for defrauding more than $1.5 billion from at least 3 million victims —as well as the 2018 Rural and Tribal Elder Justice Summit.
More information about the Department’s efforts to help American seniors is available at its Elder Justice Initiative webpage. For more information about the Consumer Protection Branch and its enforcement efforts, visit its website at https://www.justice.gov/civil/consumer-protection-branch. Elder fraud complaints may be filed with the FTC at www.ftccomplaintassistant.gov or at 877-FTC-HELP. The Department of Justice provides a variety of resources relating to elder fraud victimization through its Office for Victims of Crime, which can be reached at https://www.ovc.gov.
Bureau of Prisons “Ready to Work” Initiative Seeks New Business Partnerships to Strengthen Reentry Success and Address National Hiring ChallengesRead the Press Release
Today, the Bureau of Prisons (BOP) announced a new initiative to work directly with interested employers seeking to hire newly-released inmates. Through the “Ready to Work” initiative, the BOP seeks to connect employers directly to inmates to improve reentry outcomes. This initiative is part of the BOP’s holistic approach to implementation of the First Step Act, which was enacted in December 2018 and seeks to reduce recidivism among federal offenders.
“The Justice Department is committed to fully implementing the First Step Act,” said Attorney General William P. Barr. “This includes helping offenders successfully reintegrate into the community – a critical factor in preventing recidivism and, in turn, reducing the number of crime victims. Finding gainful employment is an important part of that process.”
The “Ready to Work” initiative aims to secure every offender reentering his or her community an opportunity to quickly secure employment. This includes the approximately 2,200 inmates scheduled for early release due to good conduct on July 19, 2019, after changes in the First Step Act become effective.
The BOP has long recognized that inmates benefit from a variety of self-improvement programs. Federal inmates participate in vocational training, educational classes, and skills groups – all of which contribute to employment readiness and helps to develop high-quality employees. At the same time, businesses are struggling to find qualified employees due to historically low unemployment rates.
“Newly-released individuals can provide an untapped source of qualified employees for businesses having difficulty hiring during this strong economy,” said Acting BOP Director Hugh Hurwitz. “The BOP is working to strengthen existing, and build new, partnerships with businesses across the country to ensure that inmates have solid employment opportunities upon release.”
Every day, the BOP releases hundreds of individuals into communities throughout the country, and employment plays a critical role in successful reentry and recidivism reduction. Studies have shown that individuals released from incarceration who found prompt employment were less likely to recidivate.
Prior to release, many individuals will have utilized BOP occupational training programs that produce skilled workers in a variety of professional fields, such as HVAC (heating, ventilation and air condition) systems, plumbing, masonry, aquiculture, computers and technology, carpentry, cosmetology, medical billing and food preparation, among other fields. But even those who do not qualify as skilled workers will have participated in BOP’s educational classes and self-improvement programming designed to improve community reintegration and contributes to employment success.
To learn more about the BOP’s “Ready to Work” initiative, including BOP’s employment readiness programs, or to begin working with the BOP to hire newly-released individuals, employers may contact BOP’s Reentry Services Division (email: BOP-RSD/[email protected]). Additional information about the BOP can be found at www.bop.gov.
Long Island Construction Business Owner Pleads Guilty to Not Paying Employment Taxes to IRSRead the Press Release
A Long Island business person in the construction industry pleaded guilty today to failing to pay over employment taxes to the Internal Revenue Service (IRS), announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division.
Edward Hansen of Northport, New York, pleaded guilty to one count of willfully failing to collect, truthfully account for, and pay over payroll taxes to the IRS. According to documents filed with the court, Hansen owned and operated steel erection businesses in Suffolk County. From 2008 to 2011, the IRS assessed more than $480,000 in penalties against Hansen for his failure to pay over employment taxes on behalf of several of these businesses. After the last IRS assessment in May 2011, Hansen changed the name of his business to BR-Teck Enterprises Inc., and nominally transferred ownership to another individual. Hansen, however, continued to operate the business and continued to fail to pay over employment taxes. From January 2012 through June 2017, Hansen failed to pay over more than $950,000 in payroll taxes withheld from the wages of BR-Teck’s employees.
Hansen faces a maximum sentence of five years in prison for failing to pay over payroll taxes. He also faces a period of supervised release, restitution and monetary penalties.
Principal Deputy Assistant Attorney General Zuckerman thanked special agents of IRS-Criminal Investigation, who conducted the investigation, and Tax Division Trial Attorneys, Abigail Burger Chingos and Jeffrey Bender, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Deputy Attorney General Jeff Rosen Issues Memo to U.S. Attorneys on the Applicability of the Wire Act to Non-Sports GamblingRead the Press Release
In the June 12, 2019 memorandum to all U.S. Attorneys, Assistant Attorneys General, and the FBI, the Deputy Attorney General extended at least until the end of the calendar year the grace period on implementing the Office of Legal Counsel's (OLC) 2018 opinion finding that all but one of the prohibitions of the Wire Act, 18 U.S.C. § 1084, apply to non-sports gambling. During the grace period, federal prosecutors should not apply the Wire Act to non-sports-related betting or wagering. The Deputy Attorney General also directed that, to ensure continuity across the country, any Wire Act charges must be reviewed and approved by the Criminal Division’s Organized Crime and Gang Section.
Nearly 1,700 Suspected Child Sex Predators Arrested During Operation “Broken Heart”Read the Press Release
The Department of Justice today announced the arrest of almost 1,700 suspected online child sex offenders during a two-month, nationwide operation conducted by Internet Crimes Against Children task forces. The task forces identified 308 offenders who either produced child pornography or committed child sexual abuse, and 357 children who suffered recent, ongoing or historical sexual abuse or were exploited in the production of child pornography.
The 61 ICAC task forces, located in all 50 states and comprised of more than 4,500 federal, state, local and tribal law enforcement agencies, led the coordinated operation known as “Broken Heart” during the months of April and May 2019. During the course of the operation, the task forces investigated more than 18,500 complaints of technology-facilitated crimes targeting children and delivered more than 2,150 presentations on internet safety to over 201,000 youth and adults.
"The sexual abuse of children is repugnant, and it victimizes the most innocent and vulnerable of all," Attorney General William P. Barr said. "We must bring the full force of the law against sexual predators, and with the help of our Internet Crimes Against Children program, we will. Over the span of just two months, our ICAC task forces investigated more than 18,000 complaints of internet-related abuse and helped arrest 1,700 alleged abusers. I would like to thank our Office of Justice Programs, all of the task force members, and especially the state and local partners who helped us achieve these important results. We are committed to bringing the defendants in these cases to justice and protecting every American child."
The operation targeted suspects who: (1) produce, distribute, receive and possess child pornography; (2) engage in online enticement of children for sexual purposes; (3) engage in the sex trafficking of children; and (4) travel across state lines or to foreign countries and sexually abuse children.
The ICAC Program is funded through the Department’s Office of Juvenile Justice and Delinquency Prevention (OJJDP) within the Office of Justice Programs (OJP). In 1998, OJJDP launched the ICAC Task Force Program to help federal, state and local law enforcement agencies enhance their investigative responses to offenders who use the internet, online communication systems or computer technology to exploit children. To date, ICAC task forces have reviewed more than 922,000 complaints of child exploitation, which have resulted in the arrest of more than 95,500 individuals. In addition, since the ICAC program's inception, more than 708,500 law enforcement officers, prosecutors and other professionals have been trained on techniques to investigate and prosecute ICAC-related cases.
For more information, visit the ICAC Task Force webpage. For state-level Operation Broken Heart results, please contact the appropriate state ICAC task force commander. Contact information for task force commanders is available online.
The Office of Justice Programs, directed by Principal Deputy Assistant Attorney General Matt M. Dummermuth, provides federal leadership, grants, training, technical assistance, and other resources to improve the nation’s capacity to prevent and reduce crime, assist victims and enhance the rule of law by strengthening the criminal justice system. More information about OJP and its components can be found at www.ojp.gov.
Justice Department Settles Claim Against Florida Strawberry Farm for Discriminating Against U.S. WorkersRead the Press Release
The Department of Justice today announced that it has reached a settlement agreement with Sam Williamson Farms Inc. (SWF), a strawberry farm in Dover, Florida. The settlement resolves the Department’s investigation into whether SWF violated the anti-discrimination provision of the Immigration and Nationality Act (INA) by preferring to hire H-2A visa holders to harvest its strawberry crop instead of U.S. workers. This is the seventh settlement under the Civil Rights Division’s Protecting U.S. Workers Initiative, which is aimed at targeting, investigating, and taking enforcement actions against companies that discriminate against U.S. workers in favor of temporary visa workers.
The Department of Justice’s independent investigation concluded that at the end of the 2016-2017 strawberry picking season, SWF informed its existing U.S. workers that it would rely instead on H-2A workers from a farm labor contractor to harvest its strawberries for the next season, and retained a farm labor contractor for the express purpose of obtaining workers with H-2A visas. Ultimately, the strawberry picking positions were filled by more than 300 H-2A workers and no U.S. workers. Refusing to recruit or hire available and qualified U.S. workers because of their citizenship status violates the INA.
“While H-2A workers can provide employers with necessary labor when there are insufficient numbers of interested U.S. workers, employers cannot deter or overlook qualified and available U.S. workers based on their citizenship status. This agreement reflects the Civil Rights Division’s continued commitment to protecting U.S. workers from discrimination,” said Assistant Attorney General Eric Dreiband of the Civil Rights Division.
Under the settlement, SWF will pay $60,000 in civil penalties to the United States, pay up to $85,000 in back pay to eligible U.S. workers, and conduct enhanced U.S. worker recruitment and advertising for future positions. The settlement also requires SWF to train employees on the requirements of the INA’s anti-discrimination provision and be subject to departmental monitoring and reporting requirements.
Under the Protecting U.S. Workers Initiative, the Civil Rights Division has opened dozens of investigations, filed one lawsuit, and reached settlement agreements with seven employers. Since the Initiative’s inception, employers have agreed to pay or have distributed a combined total of more than $1.1 million in back pay to affected U.S. workers and civil penalties to the United States. The Division has also increased its collaboration with other federal agencies to combat discrimination and abuse by employers using temporary visa workers.
The Division’s Immigrant and Employee Rights Section (IER) is responsible for enforcing the anti-discrimination provision of the INA. Among other things, the statute prohibits discrimination based on citizenship status and national origin in hiring, firing, or recruitment or referral for a fee; unfair documentary practices; retaliation; and intimidation.
More information on how employers can avoid citizenship status discrimination is available here. For more information about protections against employment discrimination under immigration laws, call IER’s worker hotline at 1-800-255-7688 (1-800-237-2515, TTY for hearing impaired); call IER’s employer hotline at 1-800-255-8155 (1-800-237-2515, TTY for hearing impaired); sign up for a free webinar; email [email protected]; or visit IER’s English and Spanish websites. Subscribe to GovDelivery to receive updates from IER.
Applicants or employees who believe they were subjected to discrimination based on their citizenship, immigration status, or national origin in hiring, firing, or recruitment or referral for a fee; or discrimination in the employment eligibility verification process (Form I-9 and E-Verify) based on their citizenship, immigration status, or national origin; or retaliation can file a charge or contact IER’s worker hotline for assistance.
El Departamento de Justicia Resuelve una Denuncia Contra una Empresa Agrícola Que Cultiva Fresas por Discriminar a Trabajadores en Este PaísRead the Press Release
WASHINGTON, D.C. – El Departamento de Justicia anunció hoy que ha llegado a un acuerdo con Sam Williamson Farms, Inc. («SWF»), una empresa agrícola que cultiva fresas en Dover, Florida. Este acuerdo resuelve la investigación del Departamento para determinar si SWF vulneró la disposición antidiscriminatoria de la ley de Inmigración y Nacionalidad («INA», por sus siglas en inglés) al preferir contratar a individuos con visas H-2A para cosechar su cosecha de fresas en vez de a trabajadores en este país. Este es el séptimo acuerdo bajo la Iniciativa para la Protección de los Trabajadores en los EE. UU., de la División de Derechos Civiles, cuya meta es enfocarse en investigar y tomar medidas de ejecución contra empresas que discriminan a trabajadores en este país a favor de trabajadores con visas temporales.
La investigación independiente del Departamento concluyó que a finales de la temporada de recogida de fresas del 2016-2017, SWF informó a sus trabajadores existentes en este país que la próxima temporada usarían a trabajadores con visa H-2A de un contratista de trabajos agrícolas para cosechar sus fresas, y empleó a un contratista de trabajo agrícolas con el fin expreso de obtener a trabajadores con visa H-2A. Al final, aquellos puestos como recogedor de fresas fueron ocupados por 300 trabajadores con visa H-2A y no por trabajadores en este país. El negarse a reclutar o a contratar a trabajadores disponibles y cualificados en este país por motivos de su estatus de ciudadanía vulnera la INA.
«Mientras que los trabajadores con visa H-2A pueden proporcionar a los empleadores la mano de obra necesaria cuando no hay suficientes trabajadores interesados en este país, los empleadores no pueden disuadir o pasar por alto a trabajadores cualificados y disponibles en este país por motivos de su estatus de ciudadanía. Este acuerdo refleja el compromiso continuo de la División de Derechos Civiles a proteger a los trabajadores en este país de la discriminación», afirmó el Fiscal General Auxiliar, Eric Dreiband, de la División de Derechos Civiles.
Conforme el acuerdo, SWF pagará $60.000 en sanciones civiles a los Estados Unidos, pagará hasta $85.000 en pagos retroactivos a trabajadores elegibles en este país y mejorará sus esfuerzos de publicidad y reclutamiento por atraer a trabajadores en este país para futuros puestos. Asimismo, el acuerdo requiere que SWF capacite a sus empleados en cuanto a los requisitos de la disposición antidiscriminatoria de la INA y que se someta a los requisitos del Departamento de supervisión.
En virtud de la Iniciativa para la Protección de los Trabajadores en los EE. UU., la División de Derechos Civiles ha iniciado decenas de investigaciones, presentado un pleito y llegado a acuerdos con siete empleadores. Desde la incepción de la Iniciativa, los empleadores han acordado pagar o han distribuido más de $1,1 millones en pagos retroactivos a trabajadores afectados en este país y sanciones civiles a los Estados Unidos. La División también ha aumentado su nivel de colaboración con otras agencias federales para combatir la discriminación y abusos por parte de empleadores que usan a trabajadores temporales con visa.
La Sección de Derechos de Inmigrantes y Empleados (IER, por sus siglas en inglés) de la División es responsable de aplicar la disposición antidiscriminatoria de la INA. Entre otras cosas, esta ley prohíbe la discriminación por motivos de estatus de ciudadanía o nacionalidad de origen en los procesos de contratación, despido o reclutamiento o recomendación por comisión; prácticas documentales injustas; y represalias y la intimidación.
Para más información sobre protecciones contra la discriminación en el empleo en virtud de las leyes migratorias, llame a la línea directa de la IER para trabajadores al 1‑800‑255-7688 (1‑800-237-2515, TTY para personas con discapacidades auditivas); llame a la línea directa de la IER para empleadores al 1-800-255-8155 (1-800-237-2515, TTY para personas con discapacidades auditivas); inscríbase a un seminario en línea gratuito; mande un correo electrónico a [email protected] o visite la página web de la IER en inglés o español. Para recibir las últimas noticias de la IER, inscríbase a GovDelivery.
Aquellos postulantes o empleados que creen haber sido víctimas de discriminación por motivos de su ciudadanía, estatus migratorio o nacionalidad de origen en los procesos de contratación, despido o reclutamiento o recomendación por comisión en el proceso de la verificación de la elegibilidad para trabajar (Formulario I-9 e E-Verify) con base en su ciudadanía, estatus migratorio o nacionalidad de origen; o represalias pueden presentar una denuncia o llamar a la línea directa de la IER para trabajadores para pedir ayuda.
Department of Justice Reminds the Public to be Aware of Fraud When Disaster Strikes and Report it to the National Center for Disaster FraudRead the Press Release
As the 2019 hurricane season begins, the Department of Justice reminds the public to be on the lookout for fraud against natural disaster victims, and report it to the National Center for Disaster Fraud (NCDF). The Atlantic Hurricane Season opened June 1 and runs through November 30.
“Committing fraud against natural disaster victims is an inexcusable crime,” said Deputy Attorney General Jeff Rosen. “It is important for people to be on the lookout for fraudsters who seek to profit from natural disasters through identity theft schemes and solicitations for fake charities. The Department of Justice is committed to detecting this type of fraud, and we will aggressively prosecute the offenders. Through our National Center for Disaster Fraud, and in conjunction with our law enforcement partners, we are working to keep Americans from becoming victims of these schemes.”
The Department of Justice established the NCDF in the wake of Hurricane Katrina, when billions of dollars in federal disaster relief poured into the Gulf Coast region, which opened opportunities for criminals to exploit people during vulnerable times. The NCDF, a national coordinating agency within the Department’s Criminal Division, operates a call center at Louisiana State University in Baton Rouge and serves as a centralized clearinghouse for disaster fraud complaints and information relating to both natural and man-made disasters. The NCDF seeks to improve and further the detection, prevention, investigation, and prosecution of fraud related to natural and man-made disasters, and to advocate for victims of such fraud. More than 20 federal, state, and local agencies participate in the NCDF, which allows them to forward on complaints to the appropriate agency for investigation.
Numerous U.S. Attorneys’ offices in districts impacted by recent hurricanes have established task forces comprised of local, state and federal agencies in their respective areas to combat disaster fraud.
"The Department of Justice and the NCDF is committed to ensuring each report of disaster fraud reaches the appropriate investigative agency. Do not let disaster strike twice. Report suspected disaster fraud to the NCDF, which has an excellent staff of investigators, analysts, call center operators, and managers who are well prepared to handle the anticipated volume of complaints during hurricane season,” said U.S. Attorney Brandon J. Fremin for the Middle District of Louisiana, who is also the NCDF’s Executive Director.
Eighteen major disaster declarations have already been declared in 2019 for events including recent storms, tornadoes, and flooding across the Midwest; Typhoon Wutip in Guam; and severe winter storms and mudslides in Oregon, California. Unfortunately, and inevitably, natural and man-made disasters will continue to occur across our great nation. These terrible and often tragic events leave many people without food, water, or shelter, and often cause devastating damage to life and property. Nevertheless, there are criminals ready to take advantage of victims before, during, and especially after a natural disaster. They are looking to strike those at their most vulnerable time.
While compassion, assistance, and solidarity are generally prevalent in the aftermath of natural disasters, unscrupulous individuals and organizations also use these tragic events to take advantage of those in need. Examples of illegal activity being reported to the NCDF and law enforcement include:
- Impersonation of federal law enforcement officials;
- Identity theft;
- Fraudulent submission of claims to insurance companies and the federal government;
- Fraudulent activity related to solicitations for donations and charitable giving;
- Fraudulent activity related to individuals and organizations promising high investment returns via profits from recovery and cleanup efforts;
- Price gouging;
- Contractor Fraud;
- Debris removal fraud;
- Theft, looting, and other violent crime
Members of the public are reminded to be extremely cautious before providing personal identifying or financial information to anyone, especially those who may contact you after a natural disaster. They are also reminded to report suspected waste, fraud, abuse, or allegations of criminal conduct. If members of the public believe they have been the victim of fraud from a person or organization soliciting relief funds on behalf of disaster victims, they are strongly encouraged to contact the National Center for Disaster Fraud Hotline toll free by phone at (866) 720-5721, email at [email protected], or fax at (225) 334-4707. The telephone line is staffed by live operators 24 hours a day, seven days a week.
To learn more about the NCDF please visit the website at www.justice.gov/disaster-fraud and watch a public service announcement.
Attorney General William P. Barr Announces the Creation of a Working Group on Prosecuting Gun Crimes to Stop and Reduce Domestic ViolenceRead the Press Release
Attorney General William P. Barr today announced the formation of a Domestic Violence Working Group aimed at keeping guns out of the hands of convicted domestic abusers, using the tools of federal prosecution to stop and prevent domestic violence. The group will operate under the auspices of the Attorney General’s Advisory Committee (AGAC) and be comprised of nine U.S. Attorneys across the country, chaired by U.S. Attorney for the Northern District of Texas Erin Nealy Cox.
“Too often, domestic abusers start with threats and abuse, and end up committing extreme violence and even homicide, with devastating impact on families and the community around them,” said Attorney General Barr. “I have directed this working group to examine this issue and determine the best way to use federal gun prosecutions and other appropriate tools to supplement state, local and tribal efforts to address domestic violence.”
“With so many domestic disputes escalating from bruises to bullets, we felt we needed to supplement our state and local partners’ efforts to curb domestic violence with federal prosecutions,” said U.S. Attorney Nealy Cox. “We hope our initial cases send a message to convicted abusers: Not only could the Justice Department theoretically prosecute abusers for firearm possession – they have and they will.”
Federal law has long barred convicted felons, as well as individuals subject to certain domestic violence protective orders or convicted of domestic violence misdemeanors, from possessing firearms.
Offenders with domestic violence in their past pose a remarkably high risk of homicide. Research shows that abusers with a gun in the home are five times more likely to kill their partners than abusers who don’t have that same access to a firearm. And according to one recent study, more than half of America’s mass shootings are cases of extreme domestic violence.
Keeping guns from domestic abusers legally prohibited from possessing them would significantly reduce violence in America, a major priority of the Justice Department.
However, federal gun cases involving domestic violence present unique challenges. In some states, the federal and state definitions of domestic violence differ, requiring complex legal analysis that varies based on the location of conviction.
U.S. Attorneys’ offices have worked tirelessly over the years to address these legal challenges with tremendous success. The Working Group will share best practices, legal analysis and guidance on prosecuting abusers who unlawfully possess guns, and will advise U.S. Attorneys across the country on outreach to local law enforcement, judges, and nonprofit groups.
Working Group members include:
- Scott W. Brady, U.S. Attorney for the Western District of Pennsylvania
- Robert M. Duncan, Jr., U.S. Attorney for the Eastern District of Kentucky
- Nicola T. Hanna, U.S. Attorney for the Central District of California
- Justin E. Herdman, U.S. Attorney for the Northern District of Ohio
- Erin Nealy Cox, U.S. Attorney for the Northern District of Texas
- Christina E. Nolan, U.S. Attorney for the District of Vermont
- Byung J. Pak, U.S. Attorney for the Northern District of Georgia
- R. Trent Shores, U.S. Attorney for the Northern District of Oklahoma
- Timothy J. Downing, U.S. Attorney for the Western District of Oklahoma
Department of Justice Files Statement of Interest in Maine First Amendment CaseRead the Press Release
The Department of Justice today filed a Statement of Interest in the U.S. District Court for the District of Maine supporting students who claim that the State discriminated against them in violation of the Free Exercise Clause of the U.S. Constitution when it barred them from a program paying the public or private school tuition of students who do not have public schools in their school districts, because the students wish to use the tuition to attend private religious schools that otherwise satisfy State education requirements.
The case, Carson v. Makin, was brought by students and their parents challenging their exclusion from the Maine tuition program. In Maine, 143 of the State’s 260 school districts do not operate their own high schools. Such school districts may arrange for another school to teach all of their students, or these school districts may provide tuition payments to allow families to go to the public school or private school of their choice. The State, however, forbids students in the tuition program to attend “sectarian” schools.
“Under the Constitution, governments may not exclude students from education programs solely because of their religious status or their religious choices,” said Assistant Attorney General Eric Dreiband. “The Department of Justice is committed to ensuring that all children and their families may participate in benefit programs without discrimination based on their faith.”
The United States’ Statement of Interest emphasizes that excluding otherwise eligible students from the program because they attend religious schools violates the First Amendment, as recently explained by the Supreme Court two years ago in Trinity Lutheran Church of Columbia v. Comer. In Trinity Lutheran, the Supreme Court held that “denying a generally available benefit solely on account of religious identity imposes a penalty on the free exercise of religion,” and may only be justified by the most compelling governmental interests, which, the brief argues, Maine cannot show here. Preferring secular private schools that meet the academic requirements set forth in Maine law to religious schools that meet those same requirements, the United States’ brief concludes, cannot be reconciled with the Supreme Court’s decision in Trinity Lutheran.
Today’s filing addresses issues set forth in the Department of Justice’s Guidance on Federal Law Protections for Religious Liberty issued on Oct. 6, 2017, at the direction of President Trump’s May 4, 2017, Executive Order Promoting Free Speech and Religious Liberty. The Department of Justice Guidance states that “government may not target persons or individuals because of their religion” and observes that “constitutional protections for religious liberty are not conditioned upon the willingness of a religious person or organization to remain separate from civil society . . . Individuals do not give up their religious-liberty protections by providing or receiving social services, education, or healthcare.”
In July 2018, the Department of Justice announced the formation of the Religious Liberty Task Force. The Task Force brings together Department components to coordinate their work on religious liberty litigation and policy, and to implement the Attorney General’s 2017 Religious Liberty Guidance.
Canon Inc., Toshiba Corporation Agree to Pay $5 Million for Violating Federal Antitrust LawsRead the Press Release
Canon Inc. and Toshiba Corporation have agreed to settle federal charges that the companies violated the premerger notification and waiting period requirements of the Hart-Scott-Rodino Act (HSR Act), when Canon acquired Toshiba Medical Systems Corporation from Toshiba in 2016.
The companies will pay $2.5 million each to settle the charges. The settlement also requires the companies to implement HSR compliance programs and comply with inspection and reporting requirements, among other obligations imposed under the consent order.
The complaint alleges that Canon and Toshiba devised a scheme to avoid observing the waiting period required by the HSR Act for Canon’s acquisition of Toshiba’s subsidiary Toshiba Medical Systems Corporation (TMSC). According to the complaint, the scheme devised by Canon and Toshiba “had no purpose” other than to complete the sale of TMSC prior to March 31, 2016, and avoid the HSR Act’s waiting period requirements.
The complaint further alleges that long-running financial irregularities at Toshiba became public in 2015 and, as a result, Toshiba was facing financial difficulty. To shore up its financial statement, Toshiba needed to recognize the proceeds of the sale of TMSC by the end of its 2015 fiscal year on March 31, 2016. The complaint also alleges that, by Canon’s and Toshiba’s own admission, Canon could not acquire TMSC outright because “it simply was not possible to complete a significant acquisition of TMSC voting securities before the end of Toshiba’s fiscal year due to the review periods under various merger control laws.”
“The HSR Act is an essential tool for antitrust enforcement because it allows federal antitrust enforcers to review proposed acquisitions for potential anticompetitive effects before they occur. Canon and Toshiba structured their transaction for the purpose of avoiding the HSR Act’s requirements,” said Assistant Attorney General Makan Delrahim of the Justice Department’s Antitrust Division. “An acquiring person may not enlist a third party to make an acquisition on its behalf to evade the HSR Act.”
“The prior notice provisions of the HSR Act are designed to allow the agencies to analyze a proposed transaction before it is consummated to determine whether it will harm competition,” said Bruce Hoffman, Director of the Federal Trade Commission’s Bureau of Competition. “Deliberately structuring a transaction to avoid or delay HSR filing undermines the efficacy of the premerger notification process, regardless of whether the parties’ motives for doing so in a particular case were anticompetitive. We will be vigilant in seeking relief against attempts to circumvent the HSR Act’s filing requirements.”
The HSR Act imposes notification and waiting period requirements for transactions meeting certain size thresholds so that they can undergo premerger antitrust review. The maximum civil penalty for an HSR violation is currently $42,530 per day.
The Department of Justice filed the complaint and proposed final judgment in the U.S. District Court for the District of Columbia on June 10, 2019.
As required by the Tunney Act, the proposed settlement, 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 Kenneth A. Libby, Special Attorney, United States, c/o Federal Trade Commission, 600 Pennsylvania Avenue, NW, Washington, DC 20580 [email protected]. At the conclusion of the 60-day comment period, the U.S. District Court for the District of Columbia may approve the proposed settlement upon finding that it is in the public interest.
New York Man Pleads Guilty to Bribing Naval Employee to Allow Him to Make Unauthorized Liquor PurchasesRead the Press Release
A New York resident pleaded guilty today to providing cash bribes to an employee of the U.S. Department of the Navy to make unauthorized liquor purchases at a Navy Exchange (NEX), announced Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and Special Agent in Charge Leo Lamont of the Naval Criminal Investigative Service’s (NCIS) Northeast Field Office.
Edwin D. Fragoso, 45, of Freeport, New York, pleaded guilty to one count of conspiracy before U.S. Magistrate Judge Gary R. Brown of the Eastern District of New York. Sentencing is scheduled for Dec. 9, 2019 before U.S. District Judge Sandra J. Feurstein of the Eastern District of New York.
According to admissions made in connection with his guilty plea, Fragoso agreed with NEX supervisory sales associate Eric J. Jex to arrange repeated large purchases of liquor from the NEX at Mitchel Field in Garden City, New York. Official policies limited access to the NEX’s goods to authorized personnel, including Navy service members, and required NEX employees to confirm purchasers’ identities. Over more than a year, until December 2016, Fragoso paid Jex over $95,000 in cash bribes to make unauthorized purchases of NEX liquor at significant discounts. He ultimately resold the liquor purchased from the NEX for profit.
On Aug. 1, 2017, Jex pleaded guilty to accepting more than $250,000 in cash bribes from Fragoso and two other individuals, Adam Agaev and David Manasherov. Agaev and Manasherov each pleaded guilty to conspiracy on Jan. 7, 2019, and are pending sentencing on Sept. 24, 2019.
The Naval Criminal Investigative Service (NCIS), Alcohol and Tobacco Tax and Trade Bureau (TTB) and New York State Department of Taxation and Finance, Criminal Investigations Division investigated the case. Trial Attorney Jessica C. Harvey is prosecuting the case.
Massachusetts Restaurant Owner Pleads Guilty to Conspiracy to Defraud the IRSRead the Press Release
A Denham, Massachusetts, resident pleaded guilty today in Boston to conspiring to defraud the United States by impeding the lawful functions of the Internal Revenue Service (IRS), announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division.
According to court documents, Ayaz Ali Shah co-owned and operated a carry-out restaurant called “New York Fried Chicken and Pizza” that conducted business in Dorchester, Massachusetts. The indictment alleges that Shah, together with his co-defendants, Muhamad Siuyab Khan and Khurshed Jehan Badshah, conspired to defraud the United States from 2009 through 2014. The co-defendants each owned twenty percent of the business, but during the five-year period charged in the indictment, Shah and his co-conspirators allegedly agreed to underreport the business’s gross receipts, cost of goods sold, and net profit, and to report these false amounts on Shah’s 2012 and 2013 individual tax returns.
The indictment against Khan and Badshah remains pending. An indictment merely alleges that crimes have been committed. A defendant is presumed innocent until proven guilty beyond a reasonable doubt.
Chief United States District Judge Patti B. Saris scheduled Shah’s sentencing for Sept. 19, 2019. Shah faces a maximum sentence of five years in prison on the conspiracy charge. He also faces a period of supervised release, restitution and monetary penalties.
Principal Deputy Assistant Attorney General Zuckerman commended special agents of IRS Criminal Investigation, the FBI Boston Division, U.S. Immigration and Customs Enforcement Homeland Security Investigations (HSI), and the Boston Police Department, who conducted the investigations, and Trial Attorneys Mark McDonald and Thomas Voracek of the Tax Division, who are prosecuting the case.
Department of Justice Opens Review of ASCAP and BMI Consent DecreesRead the Press Release
As part of The Department of Justice’s ongoing review of legacy antitrust judgments, the Antitrust Division today announced that it has opened a review of its consent decrees with The American Society of Composers, Authors and Publishers (ASCAP) and Broadcast Music, Inc. (BMI). For more than seventy-five years, these decrees have governed the process by which these two organizations license rights to publicly perform musical works. The purpose of the Division’s review is to determine whether the decrees should be maintained in their current form, modified, or terminated.
ASCAP and BMI are the two largest performing rights organizations in the United States. Their primary function is to pool the copyrights held by their composer, songwriter, and publisher members or affiliates and collectively license public performance rights to music users such as radio and television stations, streaming services, concert venues, bars, restaurants, and retail establishments. The Antitrust Division first entered into consent decrees with ASCAP and BMI in 1941 and they have since been modified – the ASCAP decree most recently in 2001 and the BMI decree in 1994. The decrees require ASCAP and BMI to issue licenses covering all works in their repertory upon request from music users. If the parties are unable to agree on an appropriate price for a license, the decrees provide for a “rate court” proceeding in front of a U.S. district judge. Neither decree contains a termination date.
“The ASCAP and BMI decrees have been in existence in some form for over seventy-five years and have effectively regulated how musicians are compensated for the public performance of their musical creations,” said Makan Delrahim, Assistant Attorney General for the Antitrust Division. “There have been many changes in the music industry during this time, and the needs of music creators and music users have continued to evolve. It is important for the Division to reassess periodically whether these decrees continue to serve the American consumer and whether they should be changed to achieve greater efficiency and enhance competition in light of innovations in the industry.”
The Antitrust Division has posted an invitation for public comment on its public website (https://www.justice.gov/atr/antitrust-consent-decree-review-ascap-and-bmi-2019), inviting interested persons, including songwriters, publishers, licensees, and other industry stakeholders to provide the Division with information or comments relevant to whether the ASCAP and BMI decrees should be modified, terminated, or retained unchanged. The period for public comment ends August 9, 2019.*
* The original version of this release stated the public comment period ended on July 10, 2019. The original 35 day comment period is now extended to 65 days.
Pennsylvania Anesthesiologist Pleads Guilty to Filing False Tax ReturnsRead the Press Release
A Pennsylvania anesthesiologist pleaded guilty today to filing a false income tax return, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division.
James G. Allen Jr., 53, admitted as part of his guilty plea that he filed false tax returns for himself and his wife for the years 2010 through 2017 with the Internal Revenue Service (IRS). He failed to report more than $3 million that the pair earned as anesthesiologists on their tax returns. According to the plea agreement, the false tax returns that Allen filed caused a loss to the government of more than $900,000.
Allen admitted that the false tax returns were based on a tax fraud scheme promoted by Peter Hendrickson in his book, Cracking the Code. Hendrickson was convicted of filing false tax returns in 2009 and sentenced to prison.
U.S District Judge Arthur J. Schwab set sentencing for Nov. 12, 2019. Allen faces up to three years in prison and a $250,000 fine. As part of his plea, Allen has agreed to pay restitution to the IRS in the amount of $902,721.45.
Principal Deputy Assistant Attorney General Zuckerman thanked special agents of IRS-Criminal Investigation, who investigated the case, and Trial Attorneys Melissa S. Siskind and Carl F. Brooker, IV of the Tax Division, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website at www.justice.gov/tax.
Castro Enterprise Leader Convicted for RICO Conspiracy and Other Violent CrimesRead the Press Release
A federal jury in Michigan found a Houston, Texas, woman guilty of a nine-count indictment for her role as the leader of several robbery crews that traveled all over the United States in order to conduct home invasions of families of Indian and Asian descent.
Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and Special Agent in Charge Timothy R. Slater of the FBI’s Detroit Field Office made the announcement.
After a four-week trial, Chaka Castro, 44, was convicted of one count of RICO (Racketeer Influenced and Corrupt Organizations Act) Conspiracy, four counts of Assault with a Dangerous Weapon in Aid of Racketeering and four counts of Use of a Firearm During and in Relation to a Crime of Violence. Sentencing is scheduled for September 2019, before U.S. District Court Judge Laurie J. Michelson of the Eastern District of Michigan, who presided over the trial.
According to evidence presented at trial, from 2011 to 2014, Chaka Castro and her robbery crews committed a string of home invasions in Georgia, New York, Ohio, Michigan and Texas. The leader of the robbery crews was Chaka Castro, who would generate lists of robbery targets in various states around the county, specifically families of Asian and Indian ancestry, and then assign crews to carry out the armed robberies of these families within their homes. Once Castro assigned a crew to a particular area, members of the group would travel to that location, conduct surveillance, and execute the robberies. The crews utilized a particular modus operandi in each of the robberies. They disguised their appearance with clothing and bandanas so that victims of their robberies would have difficulty identifying them. They would openly carry and brandish firearms to gain control of the victims and then immediately corral the victims, including children, into one location in the home. At least one robber would then restrain the victims with duct tape and threats of violence while a partner would ransack the home in search of cash, jewelry, and electronics to steal. The group organized their trips to involve multiple home invasion robberies over a series of days.
The conviction was the result of a joint federal and state investigation led by the FBI with the assistance of federal agencies, including U.S. Immigration and Customs Enforcement’s Homeland Security Investigations and the U.S. Secret Service. Local law enforcement agencies in Michigan, including Washtenaw County Sherriff’s Office, Ann Arbor Police Department and Canton Police Department; local law enforcement agencies in Ohio, including Beachwood Police Department; local law enforcement agencies in Georgia, including the Cobb County District Attorney’s Office, Cobb County Police Department, Gwinnett County Police Department, Duluth Police Department and Milton Police Department; local law enforcement agencies in New York, including Nassau County Police Department; the Tennessee Highway Patrol and local law enforcement agencies in Texas including Allen Police Department, Coppell Police Department, Flower Mound Police Department, Carrollton Police Department, Lewisville Police Department and Southlake Police Department also provided assistance in the investigation.
Trial Attorneys Marianne Shelvey and Beth Lipman of the Criminal Division’s Organized Crime and Gang Section prosecuted the case.