District Not Recorded
The source did not name an office we could identify. These records remain unassigned rather than guessed.
Justice Department Seeks to Shut Down Detroit Area Tax Return PreparersRead the Press Release
The Justice Department announced today that it has asked a federal court in Detroit to permanently bar Brandon Lee and Tamika Lee, a husband and wife who do business as Quick Money Tax & Loan Center, from preparing federal tax returns. The civil injunction suit alleges that the Lees falsify income on customers’ tax returns in order to claim false and inflated earned income tax credits (EITC).
The EITC is a refundable credit available to people who work and earn less than $51,567 per year. The maximum credit in 2010 was $5,666. Due to the method used to calculate the EITC, some people are entitled to a larger credit with a higher annual income. Some tax preparers refer to the range of earned income generating a maximum EITC as the “sweet spot.” According to the complaint, the Lees reported fabricated “Household Help” income and reported fake business income and expenses on their customers’ tax returns to report income in the EITC sweet spot on some returns they prepared. The complaint alleges that 99 percent of the returns identified by the Internal Revenue Service (IRS) as having been prepared by the Lees and their business in 2010 and 2011 claimed a refund, which is an extremely high rate.
The complaint also alleges that the Lees prepare returns for customers that falsely claim education credits, even though the customers did not attend school or have qualifying education-related expenses, and were thus ineligible for the credit.
Return preparer fraud is one of the IRS's Dirty Dozen Tax Scams for 2014. The IRS has some tips on their website for choosing a tax preparer. 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 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.
Related Materials:
United States v. Brandon T. Lee, et al.
Complaint for Permanent Injunction and Other ReliefJustice Department Requires Divestiture in Landmark Aviation's Acquisition of Ross AviationRead the Press Release
The Department of Justice announced today that it will require Landmark Aviation to divest fixed base operator assets (FBOs) used to provide flight support services to general aviation customers at Scottsdale Municipal Airport, in Arizona, in order to proceed with its $330 million acquisition of Ross Aviation. The department said that without the required divestiture, the transaction would have combined the only two FBOs serving general aviation customers at Scottsdale Municipal Airport, resulting in higher prices and lower quality of services.
The Justice Department's Antitrust Division filed a civil lawsuit today in the U.S. District Court for the District of Columbia to block the proposed transaction. At the same time, the department filed a proposed settlement that, if approved by the court, would resolve the department’s competitive concerns alleged in the lawsuit.
“Today’s proposed settlement will help ensure that FBO general aviation customers at Scottsdale Municipal Airport will continue to receive the benefits of vigorous competition,” said Bill Baer, Assistant Attorney General in charge of the Antitrust Division. “Without the divestiture secured by the Antitrust Division, the proposed acquisition would have eliminated competitive constraints at the Scottsdale airport and likely would have resulted in higher prices for consumers.”
FBOs provide fuel and related support services to general aviation customers, which include charter, private and corporate aircraft operators. Landmark and Ross are the only two providers of FBO services at Scottsdale Municipal Airport. The proposed transaction would have resulted in a monopoly for FBO services at Scottsdale Municipal Airport, and that loss of competition likely would have resulted in higher prices and a lower quality of services.
Under the terms of the proposed settlement, Landmark must divest Ross’s FBO assets at Scottsdale Municipal Airport to either Signature Flight Support Corp. or another buyer approved by the Antitrust Division.
LM U.S. Corp Acquisition Inc. (doing business as Landmark Aviation), a Delaware corporation with its headquarters in Houston, is owned by The Carlyle Group. Landmark Aviation operates more than 40 FBO facilities in the United States, including its FBO operations at Scottsdale Municipal Airport.
Ross, a Delaware corporation with its headquarters in Denver, is a subsidiary of Genossenschaft Constanter, a Swiss company. Ross owns and operates 19 FBO facilities in the United States, including its FBO operations at Scottsdale Municipal Airport.As required by the Tunney Act, the proposed settlement, along with the department’s 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 William H. Stallings, Chief, Transportation, Energy, and Agriculture Section, Antitrust Division, U.S. Department of Justice, 450 5th Street, N.W., Suite 8000, 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 proposed final judgment upon finding that it is in the public interest.
Former Employee of a U.S. Construction Company Working in Afghanistan Pleads Guilty to Receiving Illegal KickbackRead the Press Release
A former project manager of a U.S. construction company working on U.S. government contracts in Afghanistan who solicited a $60,000 kickback from an Afghan subcontractor pleaded guilty today in federal court in Tucson, Arizona.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney John S. Leonardo of the District of Arizona made the announcement.Robert L. Bertolini, 67, of Arivaca, Arizona, pleaded guilty to one count of conspiracy to commit wire fraud and receive an illegal kickback. He is scheduled to be sentenced on Oct. 8, 2014.
According to court documents, Bertolini worked for a construction company that received a U.S. Army Corps of Engineers contract to build a forward operating base for the Afghan National Army in Kabul Province, Afghanistan. The company for which Bertolini worked entered into a subcontract with an Afghan construction company. Shortly after the subcontract was awarded in the spring of 2011, Bertolini solicited personal financial benefits from the subcontractor, including a $60,000 kickback and employment for his son. On May 11, 2011, the subcontractor’s vice president wired approximately $59,975 from Afghanistan to Bertolini’s son’s bank account in Ohio. In return, Bertolini approved two modifications on the subcontract – for which Bertolini did not have actual approval from his company – that were worth $980,000 and $680,000 respectively.
This case is being investigated by the Special Inspector General for Afghanistan Reconstruction, the FBI, the Defense Criminal Investigative Service and the U.S. Army Criminal Investigation Command Major Procurement Fraud Unit. This case is being prosecuted by Trial Attorney Daniel Butler of the Criminal Division’s Fraud Section and Assistant U.S. Attorney David Zipps of the District of Arizona.Department of Justice and Federal Trade Commission Extend Public Comment Period for Workshop on Conditional Pricing PracticesRead the Press Release
The Department of Justice and the Federal Trade Commission (FTC) have extended the deadline for submitting comments on their recent Conditional Pricing Practices Workshop from Aug. 22, 2014, to Sept. 22, 2014.
The workshop, held June 23, 2014, explored the economics and legal policy implications of certain pricing practices, such as loyalty and bundled pricing. Interested parties may submit public comments online. Submitted comments and additional information about the workshop can be found on the Department of Justice and FTC websites.Big Game Hunting Guide Pleads Guilty to Felony Conspiracy Charge in Connection with Colorado Outfitter’s Illegal Mountain Lion and Bobcat Hunting ActivitiesRead the Press Release
Nicholaus J. Rodgers, 31, of Shady Cove, Oregon, pleaded guilty in federal court in Denver to a felony conspiracy charge stemming from the assistance he provided to an outfitter who sold illegal mountain lion and bobcat hunts in Colorado and Utah, the Justice Department announced.
Rodgers pleaded guilty to one count of conspiracy to violate the Lacey Act. The Lacey Act is a federal law that makes it illegal to knowingly transport or sell in interstate commerce any wildlife that has been taken or possessed in violation of state laws or regulations.
According to an indictment returned by the grand jury for the District of Colorado on Jan. 7, 2014, and the plea agreement, Rodgers conspired with others to provide numerous illegal hunts of mountain lions and bobcats in Colorado and Utah from 2007 to 2009. In particular, Rodgers and his confederates trapped, shot and caged mountain lions and bobcats prior to hunts in order to provide easier chases of the cats for clients. Rodgers also admits that he and his partners guided several hunters that did not possess a Utah mountain lion or bobcat license on mountain lion or bobcat hunts in Utah. The outfitter for whom Rodgers guided, Christopher W. Loncarich, was also indicted on Jan. 7, 2014. Loncarich is based in Mack, Colorado, which is approximately five miles from the Utah-Colorado border. Loncarich sold mountain lion hunts for between $3,500 and $7,500 and bobcat hunts for between $700 and $1,500 and shared a portion of the proceeds from successful hunts with Rodgers.
Three of Loncarich’s assistant guides have previously pleaded guilty to Lacey Act violations in connection with their guiding activities with Loncarich.
The maximum penalty for conspiring to violate the Lacey Act is up to five years in prison and a $250,000 fine. Under the terms of the plea agreement, the prosecution agreed to a sentencing calculation pursuant to the advisory United States Sentencing Guidelines but did not agree on a term of imprisonment, an amount of fines or an amount of restitution. A sentencing hearing for Rodgers is set for Nov. 7, 2014.
The case was investigated by the United States Fish & Wildlife Service, Colorado Parks and Wildlife and the Utah Division of Wildlife Resources. The case is being prosecuted by the Environmental Crimes Section of the Justice Department’s Environment and Natural Resources Division.Attorney General Holder Announces Justice Department Filings in Voting Rights Cases in Wisconsin and OhioRead the Press Release
Attorney General Eric Holder announced today that the Justice Department has submitted filings in voting rights cases in Wisconsin and Ohio. The department’s involvement in these two cases represents its latest steps to enforce the remaining parts of the Voting Rights Act against restrictive state laws, following up on the department’s lawsuits last year against similar measures in Texas and North Carolina.
In the Wisconsin case, the department filed an amicus brief in Frank v. Walker and LULAC v. Deininger, supporting an earlier ruling by the U.S. District Court for the Eastern District of Wisconsin that struck down Wisconsin’s strict photo voter identification requirement due to its effects on minority voters under Section 2 of the Voting Rights Act, and because it unduly burdens a substantial number of voters in violation of the Fourteenth Amendment. In the Ohio case, the department filed a statement of interest in NAACP v. Husted, a challenge by a civil rights group to a state law curtailing early voting and same day registration. The department’s brief contests the state of Ohio’s incorrect interpretation of the standards set forth by Section 2 of the Voting Rights Act.
“These filings are necessary to confront the pernicious measures in Wisconsin and Ohio that would impose significant barriers to the most basic right of our democracy,” said Attorney General Eric Holder. “These two states’ voting laws represent the latest, misguided attempts to fix a system that isn’t broken. These restrictive state laws threaten access to the ballot box. The Justice Department will never shrink from our responsibility to protect the voting rights of every eligible American. And we will keep using every available tool at our disposal to guard against all forms of discrimination, to prevent voter disenfranchisement, and to secure the rights of every citizen.”
In the amicus brief filed today in the U.S. Court of Appeals for the Seventh Circuit, the department argues that the district court reached the correct decision by finding that Wisconsin’s voter ID law, known as Act 23, violated the Fourteenth Amendment, because it imposes unjustified burdens on a significant number of voters, and violated Section 2 of the Voting Rights Act, because it has a discriminatory result on African-American and Hispanic voters. In addition to finding that Act 23 would result in minority voters having less opportunity to participate in the political process relative to other members of the electorate, the court found that the state’s claimed interests in combating voter fraud and promoting electoral confidence did not justify the significant burdens Act 23 imposes on substantial numbers of voters who lack a qualifying ID.
In the statement of interest filed today in U.S. District Court for the Southern District of Ohio, the department makes clear that Section 2 prohibits the state of Ohio from imposing any voting qualification, prerequisite to voting, or any standard, practice or procedure that would result in the denial or abridgement of the right to vote on account of a person’s race, color or membership in a language minority group. The filing also makes clear that in its own filings in the case the state of Ohio has incorrectly interpreted its requirements under Section 2. The department did not take a position on any of the other claims in the case.
“The United States Department of Justice today affirms its clear position that, under Wisconsin’s Act 23, minority voters have less opportunity to participate in the political process,” said James L. Santelle, United States Attorney for the Eastern District of Wisconsin. “The amicus brief that we are filing not only supports the trial court’s findings but also reflects the department’s continuing focus on ensuring that the franchise remains fully available to all qualified voters.”
“Wisconsin's proud history is one of expanding the opportunity to vote,” said John W. Vaudreuil, United States Attorney for the Western District of Wisconsin. “I'm honored to file this brief with the United States Department of Justice seeking to ensure that this great Wisconsin tradition is reaffirmed, and that every Wisconsin citizen has an equal opportunity to participate in democracy.”
“This office remains committed to preserving the rights of every Ohio voter,” said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio. “Making sure that courts continue to carefully examine voting restrictions, such as the ones recently imposed in this state, is an important part of that effort.”
In the year since the Supreme Court struck down the coverage formula that determined which jurisdictions were subject to preclearance underthe Voting Rights Act in Shelby v. Holder, Section 2 of the Voting Rights Act remains one of the department’s most powerful tools to protect voting rights. Last year the department used Section 2 to file two lawsuits against the state of Texas to stop the newly enacted discriminatory voter ID law and and to obtain a ruling that the state engaged in intentional discrimination in adopting its 2011 redistricting plans. In North Carolina, the department used Section 2 to sue to stop a number of provisions in an election law that imposes strict voter ID requirements, restricts early voting, eliminates same-day registration and refuses to count otherwise valid provisional ballots cast in the wrong precinct. The suit alleges that the challenged law was motivated by a racially discriminatory purpose and will result in African-American voters having less opportunity than other citizens to participate in the political process. All three cases are ongoing.
Related Materials:
Amicus Brief
Statement of InterestLas Vegas Street Gang Member Pleads Guilty to Racketeering and Drug ChargesRead the Press Release
On the second day of his federal jury trial, a Las Vegas Playboy Bloods street gang member pleaded guilty today to racketeering and drug charges, announced U.S. Attorney Daniel G. Bogden of the District of Nevada and Leslie R. Caldwell, Assistant Attorney General of the Justice Department’s Criminal Division.
“We will use federal resources to prosecute street gang members who commit cowardly and horrible crimes in our community,” said U.S. Attorney Bogden. “I commend the many law enforcement officers who worked on this investigation and assisted us in ensuring a conviction in this case.”
Markette Tillman, 31, pleaded guilty to one count of RICO conspiracy and one count of possession with intent to distribute cocaine base, and is scheduled to be sentenced by U.S. District Judge Kent J. Dawson on Oct. 28, 2014. Tillman faces up to 20 years in prison on each count, as well as fines of up to $1 million. The jury trial began yesterday, July 28, 2014, and the government had called seven witnesses to testify. Tillman is the remaining gang member to be convicted out of 10 charged in a RICO indictment filed in 2008.
According to the guilty plea agreement and evidence produced at trial, the Bloods are a nationally-known criminal street gang whose members engage in drug trafficking and acts of violence. The Playboy Bloods is a local “set” or affiliate of the Bloods, with local control and operation within the Las Vegas metropolitan area. The Playboy Bloods operate primarily in the Sherman Gardens Annex, a public housing complex, located at the corner of Doolittle and H Streets in Las Vegas, and commonly called the “Jets.” On or about Jan. 20, 2004, Tillman aided and abetted the murder of a security guard at the Jets. The guard approached Tillman and several other Playboy Bloods and told them to leave the property. An argument ensued, and the guard rode away on his bicycle to get help. One of the Playboy Bloods fired a gun at the guard, hitting him two times and killing him. Tillman admitted that he aided and abetted the murder of the guard and acted deliberately and intentionally with extreme disregard for human life. Tillman further admitted that he agreed with other members of the Playboy Bloods to manufacture and distribute narcotics, primarily crack cocaine, and to operate drug houses within the Playboy Bloods’ turf. Tillman specifically admitted to distributing in excess of 280 grams of crack cocaine. Tillman also admitted that he distributed crack cocaine to another person on about Jan. 3, 2007, at one of the drug houses.
Nine other defendants who have been convicted and sentenced, as follows:· Jacorey Taylor, aka “Mo-B,” 31, convicted by a jury of engaging in a racketeering conspiracy, committing violent crimes in aid of racketeering activity, using a firearm during a crime of violence, participating in a drug conspiracy, and possessing crack cocaine with the intent to distribute and sentenced to life in prison Oct. 21, 12013.
· Steven Booth, aka “Stevie-P,” 27, pleaded guilty to RICO conspiracy involving two murders and was sentenced to 20 years in prison on April 10, 2013
· Reginald Dunlap, aka “Bowlie,” 30, pleaded guilty to RICO conspiracy involving one murder and was sentenced to 20 years in prison on April 9, 2013
· Demichael Burks, aka “Mikey P,” 29, pleaded guilty to RICO conspiracy and was sentenced to 6½ years in prison on Dec. 3, 2010
· Anthony Mabry, aka “Akim Slim,” 43, pleaded guilty to RICO conspiracy and was sentenced to 14 years in prison on Oct. 20, 2010
· Delvin Ward, aka “D-Luv,” 37, pleaded guilty to RICO conspiracy and was sentenced to 11 years in prison on Sept. 17, 2010
· Terrence Thomas, aka “Seven,” 40, pleaded guilty to drug conspiracy and was sentenced to 10 years in prison on June 16, 2010
· Sebastian Wigg, aka “Rock,” 36, pleaded guilty to drug conspiracy and was sentenced to five years in prison on March 29, 2010
· Fred Nix, aka “June P,” 36, pleaded guilty to drug conspiracy and was sentenced to five years in prison on March 29, 2010
The cases were investigated by the FBI’s Las Vegas Safe Streets Gang Task Force, which includes officers from the North Las Vegas Police Department and Las Vegas Metropolitan Police Department, and are being prosecuted by Assistant United States Attorneys Nicholas D. Dickinson and Phillip N. Smith, Jr., and Kevin L. Rosenberg, Trial Attorney with the U.S. Department of Justice Organized Crime and Gang Section.
Justice Department Files Lawsuit Alleging Sex Discrimination Against the Commonwealth of Pennsylvania and the Pennsylvania State PoliceRead the Press Release
The Justice Department announced the filing of a lawsuit today against the Commonwealth of Pennsylvania and the Pennsylvania State Police, alleging that the defendants are engaged in a pattern or practice of employment discrimination against women in violation of Title VII of the Civil Rights Act of 1964. Specifically, the lawsuit challenges the state police’s use of two physical fitness tests to screen and select entry-level state troopers.
The complaint, filed in the U.S. District Court for the Middle District of Pennsylvania, alleges that the physical fitness tests used by the state police between 2003 and the present excluded qualified women from consideration for hire as entry-level state troopers by testing for physical skills that are not required to perform the job. The department also alleges that, during the relevant time period, the defendants’ use of physical fitness tests as part of a multi-step employment selection process disproportionately screened out female applicants, resulting in a disparate impact against those applicants.
Title VII prohibits both intentional discrimination on the basis of race, color, sex, national origin and religion as well as employment practices that result in a disparate impact upon a protected group, unless the practices are job-related and consistent with business necessity. The department alleges that the defendants’ use of the challenged physical fitness tests violates Title VII because that use does not meet this standard and does not identify the best qualified applicants for entry-level state trooper jobs.
“The Department of Justice is deeply committed to eliminating artificial barriers that keep qualified women out of public safety work,” said Jocelyn Samuels, Acting Assistant Attorney General for the Civil Rights Division. “The Justice Department will continue to challenge discriminatory hiring practices that unnecessarily exclude qualified applicants on account of sex.”
In the lawsuit, the department seeks a court order that would require the Pennsylvania State Police to stop using the challenged physical fitness tests, develop hiring procedures that comply with Title VII and provide make-whole relief, including offers of hire, retroactive seniority, and back pay to individual women who have been harmed as a result of the defendants’ use of the challenged physical fitness tests.
Additional information about Title VII and other federal employment laws is available on the Civil Rights Division’s website at www.justice.gov/crt/.
Related Materials:
Complaint
Former U.S. Navy Military Sealift Command Manager Sentenced for Receiving BribesRead the Press Release
Kenny E. Toy, 54, the former Afloat Programs Manager at the United States Navy Military Sealift Command, was sentenced today to serve 96 months in prison for receiving bribes.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, United States Attorney Dana J. Boente of the Eastern District of Virginia, Special Agent in Charge Robert Craig of the Defense Criminal Investigative Service (DCIS) Mid-Atlantic Field Office, Acting Executive Assistant Director Charles T. May Jr. of the Naval Criminal Investigative Service (NCIS) Atlantic Operations and Special Agent in Charge Royce E. Curtin of the FBI’s Norfolk Field Office made the announcement today after sentencing by United States Chief Judge Rebecca Beach Smith of the Eastern District of Virginia.
On Feb. 12, 2014, Toy pleaded guilty to a criminal information charging him with one count of bribery. According to the statement of facts filed with Toy’s plea agreement, Toy was employed as the Afloat Programs Manager in the N6 Command, Control, Communication, and Computer Systems Directorate at the Military Sealift Command, which is the leading provider of transportation for the United States Navy. In approximately November 2004, Toy joined an extensive bribery conspiracy that spanned five years, involved multiple co-conspirators, including two different companies, and resulted in the payment of more than $265,000 in cash bribes, among other things of value, to Toy and to Scott B. Miserendino Sr., a former government contractor who performed work for the Military Sealift Command.
At his plea hearing, Toy admitted that he accepted monthly cash bribes of approximately $3,000, as well as a flat screen television and a paid vacation to the Outer Banks in North Carolina, from co-conspirators Dwayne A. Hardman, Roderic J. Smith, Michael P. McPhail and Adam C. White, all of whom were employed at a government contracting company referred to as Company A in court documents. Toy also admitted that he accepted a $50,000 cash bribe in May 2009 from Hardman and another co-conspirator, Timothy S. Miller, both of whom were employed at a government contracting company referred to as Company B in court documents. In exchange for the bribes, Toy provided favorable treatment to Company A and Company B in connection with Military Sealift Command related business.
As part of his guilty plea, Toy also admitted to engaging in a scheme to conceal his criminal activity. Toy admitted to causing more than $88,000 to be paid to Hardman in an attempt to prevent Hardman from reporting the bribery scheme to law enforcement authorities.
Toy was also ordered to serve a supervised release term of three years following his prison sentence, and ordered to forfeit $100,000.
Earlier this year, four other individuals pleaded guilty in connection with the bribery scheme. On Feb. 18, 2014, Hardman, the co-founder of Company A and Company B, pleaded guilty to providing bribes to Toy and Miserendino. On Feb. 19, 2014, McPhail, a former employee at Company A, pleaded guilty to conspiracy to commit bribery. On April 4, 2014, White, a former vice president at Company A, pleaded guilty to conspiracy to commit bribery. On March 5, 2014, Smith, the former president of Company A, pleaded guilty to conspiracy to bribe public officials. On June 23, 2014, United States District Judge Henry Coke Morgan sentenced Smith to serve 48 months in prison followed by one year of supervised release and ordered him to forfeit $175,000.
On May 23, 2014, a grand jury in the Eastern District of Virginia indicted Miserendino and Timothy S. Miller, a businessman whose company sought contracting business from the Military Sealift Command. The indictment charges Miserendino with one count of conspiracy to commit bribery, one count of bribery, one count of conspiracy to commit obstruction of criminal investigations and to commit tampering with a witness, and one count of obstruction of criminal investigations. The indictment charges Miller with one count of conspiracy to commit bribery and two counts of bribery. Trial is set for Sept. 30, 2014, before Chief Judge Rebecca Beach Smith.
Charges contained in an indictment are merely allegations, and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
The case was investigated by the FBI, NCIS and DCIS. The case was prosecuted by Trial Attorney Emily Rae Woods of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney Stephen W. Haynie of the Eastern District of Virginia.Director of Nursing Pleads Guilty in Miami for Role in $7 Million Health Care Fraud SchemeRead the Press Release
A former director of nursing pleaded guilty today in connection with a health care fraud scheme involving Anna Nursing Services Corp. (Anna Nursing), a defunct home health care company in Miami.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Special Agent in Charge George L. Piro of the FBI’s Miami Field Office, and Acting Special Agent in Charge Ryan Lynch of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), Office of Investigations Miami office made the announcement.
Armando Buchillon, 42, of Hialeah, Florida, pleaded guilty before U.S. District Judge Joan A. Lenard in the Southern District of Florida to one count of conspiracy to commit health care fraud. Sentencing is scheduled for Oct. 6, 2014, before Judge Lenard.
According to court documents, Buchillon was a director of nursing at Anna Nursing, a Miami home health care agency that purported to provide home health and therapy services to Medicare beneficiaries. The owners and operators of Anna Nursing agreed to and actually did operate Anna Nursing for the purpose of billing the Medicare Program for, among other things, expensive physical therapy and home health care services that were not medically necessary and/or were not provided.
As part of the fraudulent scheme, Buchillon and his co-conspirators regularly falsified patient documentation in order to make it appear that beneficiaries qualified for and received home health care services, when, in fact, many of the beneficiaries did not actually qualify for or receive such services. In addition, Buchillon paid kickbacks and bribes to patient recruiters, in return for the recruiters providing patients to Anna Nursing for home health care and therapy services that were medically unnecessary and/or were not provided. Buchillon also worked as a patient recruiter for Anna Nursing and was paid kickbacks and bribes by the owner of Anna Nursing. Buchillon and his co-conspirators caused the submission of false and fraudulent claims to Medicare on behalf of these beneficiaries.
From approximately October 2010 through approximately April 2013, Anna Nursing was paid by Medicare approximately $7 million for fraudulent claims for home health care services that were medically unnecessary and/or were not provided.
The case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. This case is being prosecuted by Trial Attorneys A. Brendan Stewart and Anne P. McNamara of the Criminal Division’s Fraud Section.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 1,900 defendants who have collectively billed the Medicare program for more than $6 billion. In addition, the HHS Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov .Canadian Antique Dealer Charged with Trafficking WildlifeRead the Press Release
Canadian antiques dealer Xiao Ju Guan, aka Tony Guan, 39, was indicted by a federal grand jury in Manhattan today for conspiring to smuggle wildlife, including rhinoceros horn, elephant ivory and coralannounced Acting Assistant Attorney General Sam Hirsch for the Environment and Natural Resources Division of the Department of Justice, U.S. Attorney Preet Bharara for the Southern District of New York and Director Dan Ashe of the U.S. Fish & Wildlife Service (FWS).
Guan, the president and owner of an antiques business in Richmond, British Columbia, was arrested on March 29, 2014, after flying from Vancouver to New York and purchasing two endangered black rhinoceros horns from undercover special agents with the U.S. Fish & Wildlife Service at a storage facility in the Bronx. After purchasing the horns in a storage pod, Guan had the undercover agents drive him and a female accomplice acting as his interpreter to a nearby express mail store where he mailed the horns to an address in Point Roberts, Washington, less than a mile from the Canadian border and 17 miles from his business. Guan labeled the box of black rhino horns as containing “handicrafts” worth $200, even though he had just paid $45,000 for them. Guan indicated that he had people who could drive the horns across the border and that he had done so many times before.
Guan and his co-conspirators allegedly smuggled more than $500,000 of rhino horns and sculptures made from elephant ivory and coral from various U.S. auction houses to Canada by the same method or by having packages mailed directly to Canada with false paperwork and without the required declaration or permits. One part of the criminal scheme was to falsely describe the wildlife in order to conceal Guan’s wildlife smuggling. In the case of a rhino horn purchased in Florida, the Customs paperwork claimed it was a “Wooden Horn” worth $200.
At the same time that Guan was being arrested in New York, wildlife enforcement officers with Environment Canada executed a search warrant at Guan’s antique business in Canada. Environment Canada and Justice Canada are working cooperatively with U.S. investigators and prosecutors. The Guan case is part of “Operation Crash,” a U.S. Fish & Wildlife and Justice Department crackdown on illegal trafficking in rhinoceros horns.
“Illegal wildlife trafficking is a multibillion-dollar business that must be stopped,” said Acting Assistant Attorney General Hirsch. “The Justice Department is working vigorously to uphold the laws designed to protect rhinos and elephants and other threatened species from extinction and is working alongside our international partners to bring black-market wildlife traders to justice. We are also very grateful here for the assistance from Canadian authorities.”
“ There is an ever-expanding black market for objects made from endangered species that fuels the devastating and senseless slaughter of noble animals,” said U.S. Attorney Bharara. “The charges levied today are designed to deal a heavy blow to those that are deliberately profiting from the trade in rare and endangered species. ”
“As this case illustrates, the United States plays a key role in the illegal wildlife trade – often as the source of, or transit country for, poached and smuggled wildlife products headed elsewhere in the world,” said Director Ashe. “This makes coordination vital with our international partners as we work together to halt the slaughter of rhinos, elephants and many other imperiled species. We have a long history of collaboration with Environment Canada on wildlife trafficking and other issues, and we appreciate the invaluable assistance they’ve provided in this case.”
Rhinoceros are an herbivore species of prehistoric origin and one of the largest remaining mega-fauna on earth. They have no known predators other than humans. All species of rhinoceros are protected under U.S. and international law. Since 1976, trade in rhinoceros horn has been regulated under the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES), a treaty signed by over 170 countries around the world to protect fish, wildlife and plants that are or may become imperiled due to the demands of international markets.
Operation Crash is a continuing investigation by the Department of the Interior’s Fish and Wildlife Service (FWS), in coordination with the Department of Justice. A “crash” is the term for a herd of rhinoceros. Operation Crash is an ongoing effort to detect, deter and prosecute those engaged in the illegal killing of rhinoceros and the unlawful trafficking of rhinoceros horns. The Guan case was investigated by FWS, the U.S. Attorney’s Office Complex Frauds Unit and the Justice Department’s Environmental Crimes Section with assistance from Environment Canada’s Wildlife Enforcement Directorate. Assistant U.S. Attorney Janis M. Echenberg and Senior Counsel Richard A. Udell of the Justice Department’s Environmental Crimes Section are in charge of the prosecution.
An indictment is an allegation based upon a finding of probable cause. A defendant is presumed innocent until convicted. If convicted, Guan faces up to five years in prison for the conspiracy and wildlife charges and up to ten years in prison for the crime of smuggling. Guan could be fined up to $200,000 per count or up to twice the gross gain from the criminal conduct.Related Materials:
Indictment
Alabama Man Pleads Guilty to Involvement in Identity Theft Scheme Using Prisoner Names and Corrupt U.S. Postal Service EmployeeRead the Press Release
Gregory Slaton pleaded guilty today to one count of conspiracy to file false claims for his involvement in a Stolen Identity Tax Refund (SIRF) scheme, Deputy Assistant Attorney General Ronald A. Cimino of the Justice Department's Tax Division and U.S. Attorney George L. Beck Jr. for the Middle District of Alabama announced.
According to the court documents and court proceedings, Gregory Slaton conspired with his wife, Jacqueline Slaton, of Montgomery, Alabama, his brother-in-law, Harvey James, of Birmingham, Alabama, and a U.S. Postal Service employee, Vernon Harrison, also of Montgomery, to file false tax returns using stolen identities. James and Jacqueline Slaton obtained stolen identities, including identities of inmates, and used those identities to file the false tax returns. They directed the fraudulently claimed tax refunds to prepaid debit cards and checks. Gregory Slaton recruited Harrison into the conspiracy, who then provided Gregory Slaton with mailing addresses on his postal route to which they could mail the fraudulently claimed prepaid debit cards. James and Jacqueline Slaton then directed the tax refunds issued via debit cards and checks to be sent to specified addresses on Harrison’s mail route. Gregory Slaton would then collect the cards and checks from Harrison and pay Harrison.
Harrison was previously convicted at trial for conspiracy to file false claims and multiple counts of mail fraud, theft of mail and aggravated identity theft, and was sentenced to serve 111 months in prison. James pleaded guilty to one count of mail fraud and one count of aggravated identity theft, and was sentenced to serve 110 months in prison. Jacqueline Slaton pleaded guilty to filing a false claim and aggravated identity theft, and was sentenced to serve 70 months in prison. A sentencing date has not been scheduled for Gregory Slaton.
The case was investigated by special agents of the Internal Revenue Service - Criminal Investigation, the Bureau of Alcohol, Tobacco, Firearms and Explosives and the U.S. Postal Service’s Office of the Inspector General. Trial Attorneys Jason Poole and Michael Boteler of the Tax Division are prosecuting the case with the assistance of Assistant U.S. Attorney Todd Brown of the U.S. Attorney’s Office for the Middle District of Alabama.
Additional information about the Tax Division and its enforcement efforts may be found at the division website .
Vascular Solutions Inc. to Pay $520,000 to Resolve False Claims Allegations Relating to Medical DeviceRead the Press Release
Vascular Solutions Inc. (VSI) has agreed to pay $520,000 to resolve allegations that it caused false claims to be submitted to federal health programs by marketing a medical device for the ablation (or sealing) of perforator veins without FDA approval and despite the failure of its own clinical trial, the Justice Department announced today. VSI is a medical device company based in Minneapolis, Minnesota.
“The FDA approval process and clinical studies serve an important role in ensuring that federal health care participants receive devices that are medically appropriate and necessary,” said Assistant Attorney General Stuart F. Delery for the Justice Department’s Civil Division. “We will not permit companies to circumvent that process and put profits over patient safety.”
VSI markets and sells medical devices that treat varicose veins by sealing the veins with laser energy (endovenous laser ablation). Their products include consoles, which generate the laser energy, and accessory kits. Kits include needles to access the veins, laser fibers that carry the laser energy, and sheaths that guide the laser fiber to the area to be ablated and protect the parts of veins not being ablated. In particular, VSI marketed and sold the “Vari-Lase Short Kit” medical device. The kit contained a sheath that was shorter than other kits, which made it easier to treat vein segments that were shorter in length.
VSI’s “Short Kit” was approved only for the treatment of surface or superficial veins in the leg, which run near the surface of the body, and not for perforator veins, which connect the surface veins to deeper veins in the leg muscle. The government alleged that VSI knowingly promoted the “Short Kit” for the ablation of perforator veins even though VSI had attempted to and failed to get FDA marketing clearance for ablation of this particular type of vein, and VSI had conducted a clinical trial of the “Short Kit” for ablating perforator veins that failed to meet both safety and efficacy benchmarks. As a result of this conduct, the government alleged that VSI knowingly caused physicians and other purchasers of the “Short Kit” to submit false claims to federal health care programs for uses of the “Short Kit” that were not reimbursable.
“The settlement announced today should make it clear that the Department of Justice will pursue companies that knowingly promote medical devices for unapproved uses, causing federal health care programs to pay for services that cannot be reimbursed,” said U.S. Attorney Robert Pitman for the Western District of Texas.
“Medical device manufacturers that ignore rules designed to protect patients in order to boost profits will be held accountable for their actions,” said Special Agent in Charge Mike Fields for the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), Dallas region. “We will continue to work with the Department of Justice to root out all forms of waste, fraud, and abuse in our federal health care programs.”
The allegations resolved by today’s settlement were raised in a lawsuit filed against VSI by DeSalle Bui, a former sales representative at VSI, under the qui tam, or whistleblower, provisions of the False Claims Act, which allow private citizens with knowledge of false claims to bring civil actions on behalf of the government and to share in any recovery. Mr. Bui’s share of the settlement has not been determined.
The case was handled by the Commercial Litigation Branch of the Justice Department’s Civil Division, and the U.S. Attorney’s Office for the Western District of Texas. Assistance was provided by the Defense Health Agency, the Office of Personnel Management, and the HHS-OIG and Office of General Counsel.
This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $20.2 billion through False Claims Act cases, with more than $14 billion of that amount recovered in cases involving fraud against federal health care programs.
The claims settled by this agreement are allegations only, and there has been no determination of liability. The lawsuit is captioned United States ex rel. DeSalle Bui v. Vascular Solutions, Inc., No. A10CA883-SS (W.D. Tex.).
Physician Assistant and Certified Nursing Assistant Convicted in $200 Million Medicare Fraud SchemeRead the Press Release
A federal jury in Miami today convicted a physician assistant and a certified nursing assistant, both South Florida residents, for their participation in a Medicare fraud scheme involving approximately $200 million in fraudulent billings by American Therapeutic Corporation (ATC), a mental health care company headquartered in Miami.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Special Agent in Charge George L. Piro of the FBI’s Miami Field Office, and Acting Special Agent in Charge Reginald France of the Health and Human Services Office of Inspector General (HHS-OIG) region including all of Florida made the announcement.
Roger Bergman, 65, a physician assistant licensed in Florida, and Rodolfo Santaya, 55, a certified nursing assistant licensed in Florida, were each charged in an indictment on Jan. 28, 2014. Today, Bergman was found guilty of conspiracy to commit health care fraud and wire fraud and conspiracy to make false statements relating to health care matters. Santaya was found guilty of conspiracy to commit health care fraud and wire fraud, conspiracy to pay and receive bribes and kickbacks, and two counts of receiving bribes and kickbacks in connection with a federal health care benefit program.
ATC, Medlink Professional Management Group Inc. – a management company associated with ATC – and multiple individuals, including ATC’s owners, have all previously pleaded guilty or have been convicted at trial in connection with the fraud scheme. ATC operated purported partial hospitalization programs (PHPs) in seven locations throughout Orlando and south Florida. A PHP is a form of intensive treatment for severe mental illness.
According to evidence presented at trial, Bergman, Santaya and their co-conspirators caused the submission of fraudulent claims to Medicare through ATC seeking reimbursement for mental health services that were not provided or were provided to patients who were not eligible to receive the services. Bergman, who worked at ATC’s Miami and Homestead, Florida, offices, created, falsified and signed fraudulent medical documentation to make it appear to Medicare that ATC’s patients qualified for, and received, PHP services, even though they did not. Santaya received hundreds of thousands of dollars in illegal kickback payments in exchange for delivering ineligible Medicare beneficiaries to ATC’s Homestead office.
Throughout the course of the conspiracy, ATC and its employees paid tens of millions of dollars in kickbacks in exchange for the names and identification numbers of Medicare beneficiaries so that ATC could fraudulently bill Medicare for PHP services that it never provided or that it purportedly provided to beneficiaries who were not eligible to receive PHP treatment.
The case is being investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. The case is being prosecuted by Assistant Chief Robert A. Zink and Trial Attorneys Nicholas E. Surmacz and Kelly Graves of the Criminal Division.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 1,900 defendants who have collectively billed the Medicare program for more than $6 billion. In addition, the HHS Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.To learn more about the Health Care Fraud Prevention and Enforcement Team (HEAT), go to: www.stopmedicarefraud.gov.
Lloyds Banking Group Admits Wrongdoing in LIBOR Investigation, Agrees to Pay $86 Million Criminal PenaltyRead the Press Release
Lloyds Banking Group plc has entered into an agreement with the Department of Justice to pay an $86 million penalty for manipulation of submissions for the London InterBank Offered Rate (LIBOR), a leading global benchmark interest rate.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, Deputy Assistant Attorney General Brent Snyder of the Antitrust Division, and Assistant Director in Charge Valerie Parlave of the FBI’s Washington Field Office made the announcement.
A criminal information will be filed today in U.S. District Court for the District of Connecticut that charges Lloyds as part of a deferred prosecution agreement (DPA). The information charges Lloyds with wire fraud for its role in manipulating LIBOR. In addition to the $86 million penalty, the DPA requires the bank to admit and accept responsibility for its misconduct as described in an extensive statement of facts. Lloyds has agreed to continue cooperating with the Justice Department in its ongoing investigation of the manipulation of benchmark interest rates by other financial institutions and individuals.
“For more than three years, traders at Lloyds manipulated the bank’s LIBOR submissions for three currencies to benefit the trading positions of themselves and their friends, to the detriment of the parties on the other side of the trades,” said Assistant Attorney General Caldwell. “Because investors and consumers rely on LIBOR’s integrity, rate-rigging fundamentally undermines confidence in financial markets. Lloyds is the fifth major financial institution that has admitted LIBOR manipulation and paid a criminal penalty, and nine individuals have been criminally charged by the Justice Department. Our active investigation continues, as we work to restore trust in the markets.”
“Lloyds manipulated benchmark rates, allowing its traders to increase their profits unfairly and fraudulently,” said Deputy Assistant Attorney General Brent Snyder of the Justice Department’s Antitrust Division. “Lloyds’s conduct undermined financial markets domestically and abroad, and today’s charges send a clear message that we will continue to bring those responsible to justice."
“Manipulating financial trading markets to create an unfair advantage is against the law,” said Assistant Director in Charge Parlave. “Today’s agreement further underscores the FBI’s ability to investigate complex international financial crimes and bring the perpetrators to justice. The Washington Field Office has committed significant time and resources including the expertise of Special Agents, forensic accountants and analysts to investigate this case along with our Department of Justice colleagues. Their efforts send a clear message to anyone contemplating financial crimes: think twice or you will face the consequences.”
Together with approximately $283 million in criminal and regulatory penalties imposed by other agencies in actions arising out of the same conduct – $105 million by the Commodity Futures Trading Commission (CFTC), and approximately $178 million by the U.K. Financial Conduct Authority (FCA) – the Justice Department’s $86 million criminal penalty brings the total amount to be paid by Lloyds to almost $370 million.
According to signed documents, LIBOR is an average interest rate, calculated based upon submissions from leading banks around the world and reflecting the rates those banks believe they would be charged if borrowing from other banks. LIBOR serves as the primary benchmark for short-term interest rates globally and is used as a reference rate for many interest rate contracts, mortgages, credit cards, student loans and other consumer lending products. The Bank of International Settlements estimated that as of the second half of 2009, outstanding interest rate contracts were valued at approximately $450 trillion.
At the time relevant to the conduct in the criminal information, LIBOR was published by the British Bankers’ Association (BBA), a trade association based in London. LIBOR was calculated for 10 currencies at 15 borrowing periods, known as maturities, ranging from overnight to one year. The LIBOR for a given currency at a specific maturity was the result of a calculation based upon submissions from a panel of banks for that currency (the Contributor Panel) selected by the BBA. From at least 2006 through the present, Lloyds (through its subsidiaries) has been a member of the Contributor Panel for a number of currencies, including United States Dollar LIBOR, Pound Sterling LIBOR, and Yen LIBOR.
According to the statement of facts accompanying the agreement, between at least as early as 2006 and at least as late as July 2009, Lloyds’s LIBOR submitters for Dollar LIBOR, Yen LIBOR, and Pound Sterling LIBOR submitted LIBOR contributions intended to benefit their own trading positions or the trading positions of others , rather than rates that complied with the definition of LIBOR. When Lloyds LIBOR submitters contributed LIBOR submissions to benefit trading positions, the manipulation of the submissions affected the fixed rates on occasion.
According to signed documents, on May 19, 2009, a money markets trader who was a former Dollar LIBOR submitter at a subsidiary of Lloyds wrote to the then-current Dollar LIBOR submitter: “have 5 yard [billion] 3 month liability rolls today so would be advantageous to have lower 3month libor setting if doesn’t conflict with any of your fix’s.” Later that day, the Dollar LIBOR submitter told the money markets trader in a phone call: “obviously we got the Libors down for you.”
In another example, on March 6, 2009, a money markets trader who was a former Pound Sterling LIBOR submitter for a subsidiary of Lloyds told the then-current Pound Sterling LIBOR submitter: “Um, I’m paying on 12 yards [billions] of 1s today, . . . so if there is any way of making 1s relatively low it would just be helpful for us all.” That day, the Pound Sterling LIBOR submitter contributed a rate that was ten basis points lower than the previous day’s submission.
Also according to the statement of facts, a Yen LIBOR submitter and a former submitter at Coöperatieve Centrale Raiffeisen-Boerenleenbank B.A. (Rabobank) who traded money-markets and derivatives products had an agreement to submit Yen LIBOR contributions that benefitted their respective trading positions, rather than submissions that complied with the definition of LIBOR.
For example, on July 28, 2006, the Rabobank submitter wrote to the Yen LIBOR submitter: “morning skipper.....will be setting an obscenely high 1m again today...poss 38 just fyi.” The Yen LIBOR submitter responded: “(K)...oh dear..my poor customers....hehehe!! manual input libors again today then!!!!” Both banks’ submissions on July 28 moved up one basis point, from 0.37 to 0.38.
This ongoing investigation is being conducted by special agents, forensic accountants, and intelligence analysts of the FBI’s Washington Field Office. The prosecution of Lloyds is being handled by Trial Attorney Patrick Pericak of the Criminal Division’s Fraud Section and Trial Attorney Michael T. Koenig of the Antitrust Division. Assistant U.S. Attorneys Chris Mattei and Michael McGarry of the U.S. Attorney’s Office for the District of Connecticut, along with the Criminal Division’s Office of International Affairs, have provided valuable assistance in this matter.
The investigation leading to these cases has required, and has greatly benefited from, a diligent and wide-ranging cooperative effort among various enforcement agencies both in the United States and abroad. The Justice Department acknowledges and expresses its deep appreciation for this assistance. In particular, the CFTC’s Division of Enforcement referred this matter to the department and, along with the FCA, has played a major role in the investigation. Various agencies and enforcement authorities from other nations are also participating in different aspects of the broader investigation relating to LIBOR and other benchmark rates, and the department is grateful for their cooperation and assistance. In particular, the Securities and Exchange Commission has played a significant role in the LIBOR investigation, and the department expresses its appreciation to the United Kingdom’s Serious Fraud Office for its assistance and ongoing cooperation.
This prosecution is part of efforts underway by President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets and recover proceeds for victims of financial crimes. For more information about the task force visit: www.stopfraud.govIraq Extradites Fugitive Defense Contractor to U.S. to Face Fraud ChargesRead the Press Release
A Las Vegas-based former Department of Defense contractor has been extradited from Iraq to the United States to face fraud and conspiracy charges for attempting to bribe U.S. officials in order to secure government contracts for his companies. Metin Atilan, 54, is the first person extradited from Iraq to the United States pursuant to the U.S.-Iraq extradition treaty signed on June 7, 1934 and entered into force in 1936.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Carter M. Stewart of the Southern District of Ohio, Special Agent in Charge Kevin Cornelius of the FBI’s Cincinnati Office and Resident Agent in Charge Bret Flinn of the Defense Criminal Investigation Service (DCIS) made the announcement.
“This historic extradition from Iraq to the United States is an example of our cooperation with law enforcement worldwide to bring fugitives to justice,” said Assistant Attorney General Caldwell. “Atilan’s return to the United States, after more than six years on the run, sends a clear message to fugitives: no matter where in the world you try to hide, we will find you, and we will prosecute you.”
“ This case is a tremendous example of a successfully organized and cooperative law enforcement effort put forth by the FBI, DCIS, Interpol and the Iraqi government,” said Special Agent in Charge Cornelius. “I commend the work of the FBI’s Legal Attaché Office and the U.S. Embassy Country Team in Iraq. They have garnered a superior level of law enforcement cooperation between the FBI and Iraqi officials. Without their support, this extradition would not have been possible.”
Atilan, a dual U.S. and Turkish citizen, is scheduled to appear today before U.S. Magistrate Judge Michael R. Merz of the Southern District of Ohio.
Atilan was charged by indictment on June 10, 2008, with conspiracy to engage in contract fraud, conspiracy to engage in wire fraud, and wire fraud. According to court documents, Atilan is p resident and chief executive officer of PMA Services Ltd. of Las Vegas and Kayteks Ltd. of Adna, Turkey. In 2006 through 2008, Atilan offered bribes and kickbacks in order to secure contracts for businesses he owned in connection with services and construction associated with U.S. military operations in Iraq. Some of the Defense Department contracting officials who Atilan is accused of trying to bribe were stationed in Dayton at the time.
Atilan was first arrested in Las Vegas on May 23, 2008. Atilan was placed on electronic monitoring pending his formal hearing before a federal judge in Dayton, Ohio. On June 15, 2008, Atilan allegedly violated the terms of his pretrial release by cutting off his electronic bracelet and fleeing the country. The government sought his extradition, and Atilan arrived in Dayton, Ohio on July 27, 2014.
An indictment is merely an accusation, and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
This case was investigated by the FBI and DCIS. The case is being prosecuted by Assistant U.S. Attorney Dwight Keller of the Southern District of Ohio with assistance from Trial Attorney Dan E. Stigall of the Criminal Division’s Office of International Affairs and Department of Justice Attaché Ellen Endrizzi. The Criminal Division’s Office of International Affairs also provided assistance.Historic Clean Water Act Settlement Will Prevent Millions of Gallons of Sewage Discharges into San Francisco BayRead the Press Release
The U.S. Environmental Protection Agency today announced a Clean Water Act settlement requiring the East Bay Municipal Utility District (EBMUD) and seven East Bay communities to conduct extensive system repairs aimed at eliminating millions of gallons of sewage discharges into San Francisco Bay. Under today’s agreement, EBMUD and the communities will assess and upgrade their 1,500 mile-long sewer system infrastructure over a 21-year period. The work is expected to cost approximately $1.5 billion. The entities will pay civil penalties of $1.5 million for past sewage discharges that violated federal environmental law.
Since 2009, EPA, state and local regulators and environmental groups have worked to reduce sewage discharges from East Bay communities. During that period, interim actions required EBMUD and the East Bay communities to improve their sewer maintenance practices and gather information to identify priorities for investment.
The San Francisco Bay covers 1,600 square miles and is the largest Pacific estuary in the Americas, a host for millions of migratory birds and a hub of commerce and recreation for more than 7 million Bay Area residents. Unfortunately, the bay is under threat from many sources of pollution, including crumbling wastewater infrastructure that allows sewage to escape from the system. During rainstorms, in particular, older sewer systems can be overwhelmed, releasing rivers of sewage before fully treated.
In addition to polluting waterways , raw and partially treated sewage can spread disease-causing organisms, metals, and nutrients that threaten public health. Sewage can also deplete oxygen in the bay, threatening fish, seals and other wildlife.
“For many years, the health of San Francisco Bay has been imperiled by ongoing pollution, including enormous discharges of raw and partially treated sewage from communities in the East Bay,” said Jared Blumenfeld, EPA’s Regional Administrator for the Pacific Southwest. “Many of these discharges are the result of aging, deteriorated sewer infrastructure that will be fixed under the EPA order.”
Today’s settlement is the result of a Clean Water Act enforcement action brought by the EPA, U.S. Department of Justice, State Water Resources Control Board, San Francisco Bay Regional Water Board, San Francisco Baykeeper and Our Children’s Earth Foundation.
“This settlement will result in major reductions of sewage discharges into the San Francisco Bay,” said W. Benjamin Fisherow, Chief of Environmental Enforcement in the Justice Department’s Environment and Natural Resources Division. “These improvements will help reach our goal of eliminating pollution in the neighborhoods in these cities and in the bay so that citizens may rest assured that they reside in a safe, clean environment.”
The seven East Bay communities in the EBMUD settlement are:
- City of Alameda
- City of Albany
- City of Berkeley
- City of Emeryville
- City of Oakland
- City of Piedmont
- Stege Sanitary District (serving El Cerrito, Kensington, and a portion of Richmond)
“The public has been required to repair their own sewer laterals for over two years now, so it is past time that the local agencies aggressively repair their sewer systems,” said Bruce Wolfe, Executive Officer of the San Francisco Bay Regional Water Board. “This settlement spells out how the agencies will work with the public over the next 21 years to do just that and protect the bay.”
“Baykeeper will be watching the progress of these repairs closely to ensure that pollution of San Francisco Bay is reduced and eventually eliminated, and we will take action if the repairs fall short,” said Baykeeper Executive Director Deb Self.
On an annual basis, hundreds of millions of gallons of raw and partially treated sewage are discharged directly to San Francisco Bay. Also, as much as 600,000 gallons of raw sewage from community sewer systems is first discharged onto streets and other public areas—through outlets such as manhole covers—before it drains to the bay.
As part of the agreement, EBMUD and the seven communities will:
- repair and rehabilitate old and cracked sewer pipes;
- regularly clean and inspect sewer pipes to prevent overflows of raw sewage;
- identify and eliminate illegal sewer connections;
- continue to enforce private sewer lateral ordinances; and
- ensure proactive renewal of existing sanitary sewer infrastructure.
EBMUD will also immediately begin work to offset the environmental harm caused by the sewage discharges, which are expected to continue until these sewer upgrades are completed, by capturing and treating urban runoff and contaminated water that currently flows to the bay untreated during dry weather.
Keeping raw sewage and contaminated storm water out of the waters of the United States is one of EPA’s National Enforcement Initiatives. The proposed settlement is subject to a 30-day public comment period and final court approval. Read the settlement at: www.usdoj.gov/enrd/Consent_Decrees.html
Learn more about EPA’s national wastewater enforcement initiative at: http://go.usa.gov/5pak
EPA is working to restore San Francisco Bay, learn more at: http://www2.epa.gov/sfbay-delta
Michigan Woman Convicted of Criminal ContemptRead the Press Release
A federal jury in Detroit convicted a Commerce Township, Michigan, woman of criminal contempt based on violating an injunction that required her to comply with various legal tax obligations, the Justice Department and Internal Revenue Service (IRS) announced today.
Doreen Hendrickson was convicted of criminal contempt based on her violation of an injunction issued by U.S. District Judge Nancy Edmunds in May 2007. Hendrickson failed to file amended tax returns or repay the tax refunds as ordered by the judge, and filed an additional false tax return for 2008 on which she falsely claimed that wages she earned as a movie extra were not taxable. For more information about the injunction, please see the previously issued press release . She will be sentenced on Nov. 20.
According to court filings and evidence presented at trial, Hendrickson and her husband, Peter Hendrickson, filed federal income tax returns for the years 2002 and 2003 on which they falsely claimed they earned zero wages. Based on these false returns, the IRS issued the Hendricksons more than $20,000 in income tax refunds that they were not entitled to receive. In 2006, the department’s Tax Division sued the Hendricksons to recover these refunds. As part of that case, Judge Edmunds ordered the Hendricksons to file corrected amended tax returns for 2002 and 2003 that reported all of their income, and to repay their fraudulently obtained refunds to the IRS. Judge Edmunds also barred the Hendricksons from filing additional false tax returns.
The Hendricksons’ false 2002 and 2003 income tax returns were the subject of a prior criminal prosecution. In 2009, Hendrickson’s husband, Peter Hendrickson, was convicted of filing multiple false income tax returns, including the 2002 and 2003 returns that he filed jointly with his wife. According to evidence presented at trial, these tax returns were based on the false and frivolous theories that Peter Hendrickson promoted in his book, “Cracking the Code,” and on his website, Lost Horizons. Doreen Hendrickson filed her false 2008 income tax return while her husband was indicted for filing false tax returns.
The case was investigated by special agents of IRS – Criminal Investigation, and prosecuted by Trial Attorneys Melissa S. Siskind, Jeffrey B. Bender and Jeffrey A. McLellan of the Tax Division.
Additional information about the Tax Division and its enforcement efforts may be found at the division website .
Justice Department Obtains $80,000 Settlement in Housing Discrimination Lawsuit Against California LandlordRead the Press Release
The Justice Department today announced an agreement with the owners and operators of Woodland Garden Apartments in Fremont, California, to settle allegations of discrimination against families with children. Under the consent order, which must still be approved by the U.S. District Court for the Northern District of California, the defendants are required to pay $77,500 to the victims of their discrimination and an additional $2,500 to the government as a civil penalty. The settlement resolves a complaint filed by the department on Oct. 25, 2013.
The lawsuit alleged that the apartment complex maintained rules that discriminated against families with children in violation of the Fair Housing Act. Specifically, the lawsuit challenged a rule that prohibited children from playing outside in the common grassy areas of the complex and provided that families would be evicted if they violated this rule. The lawsuit also alleged that the actions of the defendants constituted a pattern or practice of discrimination.
The lawsuit arose as a result of complaints filed with the U.S. Department of Housing and Urban Development (HUD) by five families who lived at Woodland Garden Apartments and by Project Sentinel, a fair housing organization operating in Northern California. After an investigation of the complaints, HUD issued a charge of discrimination and the complainants were referred to the department.
“Federal law guarantees families with children the right to equal access to housing, including full access to their homes’ amenities and facilities,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division. “Settlements such as this one help ensure that all families can enjoy that right.”
“An apartment complex may not impose conditions on families with children that they do not impose on other residents,” said HUD’s Assistant Secretary for Fair Housing and Equal Opportunity Gustavo Velasquez . “HUD and DOJ remain committed to enforcing fair housing laws that ensure all people share the same rights to use and enjoy their homes.”
In addition to monetary payments, the consent order requires defendants to implement a nondiscrimination policy, establish new enforcement procedures for rule violations and undergo training on the Fair Housing Act.
Fighting illegal housing discrimination is a top priority of the department. The federal Fair Housing Act prohibits discrimination in housing on the basis of race, color, religion, sex, familial status, national origin and disability.
More information about the Civil Rights Division and the laws it enforces is available at the division's website . Persons who believe they have experienced or witnessed unlawful housing discrimination may call the Housing Discrimination Tip Line at 1-800-896-7743, e-mail the Justice Department at [email protected] , or contact HUD at 1-800-669-9777. More information about the Fair Housing Act can also be found at the department website or the HUD website .
Justice Department Announces Proposed Amendment to Americans with Disabilities Act Regulations to Expand Access to Movie Theaters for Individuals with Hearing and Vision DisabilitiesRead the Press Release
The Justice Department announced today that Attorney General Eric Holder has signed a Notice of Proposed Rulemaking (NPRM) to amend the Title III regulation for the Americans with Disabilities Act (ADA) to require movie theaters to provide closed movie captioning and audio description in order to give persons with hearing and vision disabilities access to movies.
"This proposed rule will allow all Americans, including those with disabilities, to fully participate in the moviegoing experience. With this proposal, the Justice Department is taking an important step to ensure consistent access for people with vision and hearing disabilities," said Attorney General Eric Holder. "Twenty-four years after its passage, the Americans with Disabilities Act remains a critical tool for extending the promise of opportunity and inclusion for everyone in this country."
Closed movie captioning refers to captions that are delivered to the patron’s seat and are visible only to that patron. Audio description enables individuals who are blind or have low vision to enjoy movies by providing a spoken narration of key visual elements of a movie, such as actions, settings, facial expressions, costumes and scene changes. Audio description is transmitted to a user’s wireless headset. The department is proposing to provide a consistent nationwide standard for movie theaters to exhibit movies that are available with closed movie captioning and audio description for all showings. The department is also proposing to require theaters to provide a specific number of closed captioning and audio description devices. Theaters need not comply with the proposed rule if doing so would cause an undue burden or fundamental alteration. The department is not proposing to require movie theaters to add captions or audio description to movies that are not already produced and distributed with these features.
The department is proposing a six-month compliance date for movie theaters’ digital movie screens and is seeking public comment on whether it should adopt a four-year compliance date for movie theaters’ analog movie screens or should defer rulemaking on analog screens until a later date.
“As we celebrate the 24th anniversary of the Americans with Disabilities Act on Saturday, we are reminded that people with disabilities still do not have full access to all aspects of American cultural life,” said Jocelyn Samuels, Acting Assistant Attorney General for Civil Rights. “Although some movie theaters are making strides towards meeting their ADA obligations, there is a good deal of inconsistency among theaters across the United States. This proposed rule is intended to ensure that, regardless of where a person with a hearing or vision disability lives, that person will be able to attend movies with their friends and family and fully enjoy this important social and cultural activity.”
On July 26, 2010, the department published an Advance Notice of Proposed Rulemaking (ANPRM) asking how requirements for movie captions and audio description should be implemented. The ANPRM sought public comment regarding the type of accessibility requirements for captioning and video [audio] description the department should consider, particularly in light of the industry’s conversion to digital cinema technology. The department received more than a thousand comments in response to the ANPRM and these comments were taken into consideration when developing the proposed rule.
The department intends to publish the proposed rule in the Federal Register in the near future, and public comments on the NPRM will be due 60 days from the date the rule is published.
The NPRM is available for review on the ADA website .
Those interested in finding out more about the ADA may call the department’s toll-free ADA Information Line at 800-514-0301 (TTY 800-514-0383) or visit the ADA website.
French Citizen Sentenced for Obstructing a Criminal Investigation into Alleged Bribes Paid to Win Mining Rights in GuineaRead the Press Release
Frederic Cilins, a 51-year old French citizen, was sentenced today in the Southern District of New York to 24 months in prison for obstructing a federal criminal investigation into alleged bribes to obtain mining concessions in the Republic of Guinea.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Preet Bharara of the Southern District of New York and Assistant Director in Charge George Venizelos of the FBI’s New York Field Office made the announcement. The sentence was imposed by U.S. District Court Judge William H. Pauley III.
“Cilins offered to bribe a witness in an FCPA investigation to stop the witness from talking to the FBI,” said Assistant Attorney General Caldwell. “Today’s sentence holds Cilins accountable for his effort to undermine the integrity of our justice system, and sends a message that those who interfere with federal investigations will be prosecuted and sent to prison.”
“Frederic Cilins went to great lengths to thwart a Manhattan federal grand jury’s investigation into an alleged bribery scheme in the Republic of Guinea,” said U.S. Attorney Bharara. “In an effort to prevent the federal authorities from learning the truth, Cilins paid a witness for her silence and to destroy key documents. Today, Cilins learned that no one can manipulate justice.”
“Cilins obstructed the efforts of the FBI during the course of this investigation,” said Director in Charge Venizelos. “His guilty plea and sentence demonstrate our shared commitment with the department’s Criminal Division and U.S. Attorney’s Office to hold accountable those who seek to interfere with the administration of justice. This case should be a reminder to all those who try to circumvent the efforts of a law enforcement investigation: the original crime and the cover-up both lend themselves to prosecution.”
According to court documents, Cilins obstructed an ongoing federal investigation concerning potential violations of the Foreign Corrupt Practices Act (FCPA) and other crimes. Federal law enforcement was investigating whether a particular mining company with which Cilins was affiliated paid bribes to officials of a former governmental regime in the Republic of Guinea to obtain and retain valuable mining concessions in the Republic of Guinea’s Simandou region. During monitored and recorded phone calls and face-to-face meetings, Cilins agreed to pay substantial sums of money to induce a witness to the alleged bribery scheme to leave the United States to avoid questioning by the FBI, as well as to give documents to Cilins for destruction that had been requested by the FBI as part of the investigation. Cilins also sought to induce the witness to sign an affidavit containing false statements regarding matters under investigation by the grand jury. That witness was the former wife of a now-deceased Guinean government official who held an office in Guinea that allowed him to influence the award of mining concessions.
Cilins pleaded guilty on March 10, 2014 to a one-count superseding information charging him with obstruction of a federal investigation. In addition to his sentence, he was ordered to pay a fine of $75,000 and forfeit $20,000.
The case was investigated by the FBI. The case is being prosecuted by Trial Attorney Tarek Helou of the Criminal Division’s Fraud Section and Assistant United States Attorney Elisha J. Kobre of the Southern District of New York. The Criminal Division’s Office of International Affairs and Office of Enforcement Operations provided valuable assistance in the investigation.
Additional information about the Justice Department’s FCPA enforcement efforts can be found at www.justice.gov/criminal/fraud/fcpa .Former U.S. House of Representatives Employee Pleads Guilty to Theft of Government PropertyRead the Press Release
Brian Prokes, 28, a former office manager in the U.S. House of Representatives, pleaded guilty today for causing the House of Representatives to pay more than $19,000 in excess salary and unauthorized travel expenses, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division.
According to court documents, Prokes worked as the office manager for a U.S. Congressman. Prokes’s responsibilities included transmitting salary and bonus information to the House of Representatives’ Office of Payroll and Benefits in order to adjust the pay of employees in the Congressman’s office. Prokes admitted that, between April 2012 and March 2013, he submitted unauthorized paperwork to the Office of Payroll and Benefits to pay himself larger salary and bonus than he had been approved to receive.
In addition, Prokes admitted that, between February 2012 and December 2012, he charged unauthorized, personal travel expenses for himself and an acquaintance to a government credit card used by the Congressman’s office. The excess salary payments and unauthorized travel expenses amounted to more than $19,000.
Prokes, of Atlanta, Georgia, is scheduled to be sentenced on Oct. 14, 2014, before U.S. District Judge Rudolph Contreras in the District of Columbia.
This case was investigated by the FBI. This case is being prosecuted by Trial Attorneys Kevin O. Driscoll and Sean F. Mulryne of the Criminal Division’s Public Integrity Section.Justice Department Issues Joint Statement of Principles with City of Albuquerque, New Mexico, to Reform Albuquerque Police DepartmentRead the Press Release
The Justice Department today announced it has signed a joint statement of principles with the city of Albuquerque, New Mexico, that reflects the good-faith intent of both sides to enter into a court-enforceable agreement to reform the Albuquerque Police Department (APD). The joint statement of principles publicly specifies the measures that the department and the city are undertaking in order to resolve the findings resulting from the department’s investigation into use of force by APD. On April 10, 2014, following an extensive investigation, the department found reasonable cause to believe that APD engages in a pattern or practice of use of excessive force, including unreasonable deadly force.
Following the release of the findings letter the department and the city each separately reached out to numerous stakeholders across Albuquerque to hear their ideas and concerns about the reform of APD. Attorneys and staff of the department have spoken to police officers, city officials, mental health service providers, advocacy organizations, individuals who have been personally affected by APD’s past conduct and other community members. The department has held dozens of meetings and met with hundreds of people across the city. Through these efforts, both sides have gained important insights into officers’ and the community’s concerns that will shape the final agreement. The department is encouraged by the feedback it has received and is committed to sustainable reforms that will ensure APD delivers services in a manner that respects the rights of residents, promotes mutual confidence between the police and the community and improves public and officer safety.
“This agreement marks an important step forward in addressing the unreasonable use of deadly force uncovered in our investigation into the Albuquerque Police Department," said Attorney General Eric Holder. "The residents of Albuquerque depend on their police department to serve their community with honor and integrity. In the overwhelming majority of cases, our dedicated local law enforcement officials – who put their lives on the line every day— do just that. But when misconduct does occur, we will never hesitate to act in order to secure the civil rights of everyone in this country. As a result of our ongoing action, I am confident that the Albuquerque Police Department will be able to correct troubling practices, restore public trust, and better protect its citizens against all threats and dangers - while providing the model of professionalism and fairness that all Americans deserve.”
“We commend the city for engaging in good-faith negotiations to reach a court-enforceable agreement that will ensure sustainable reforms of APD,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division. “The joint statement of principles provides the community with our commitment to work expeditiously with the city to craft a durable agreement that will resolve our findings and will ensure that APD provides effective and constitutional policing to the people of Albuquerque.”
“Since the release of DOJ’s findings letter, we have asked for and received valuable ideas and insights from officers, members of the community, representatives of many organizations, and others who have a stake in the future of our community,” said U.S. Attorney Damon Martinez for the District of New Mexico. “We are thankful to everyone who has spoken to us. The anticipated final court-enforceable agreement, which we hope to enter into with the city of Albuquerque, is already stronger because of the input we have received.”
The department and city have released the joint statement of principles to inform APD officers and the Albuquerque community that their concerns and ideas have been heard and that their ongoing participation will be critical to achieving sustainable reform. Specifically, the joint statement of principles announces that the department and the city expect to develop reforms in the eight areas outlined in the department’s findings letter: use of force policies, interactions with individuals with mental illness and other disabilities, tactical units, training, internal investigations and civilian complaints, management and supervision, recruitment and selection of officers, and community engagement and oversight. The joint statement of principles also indicates that the goal is to reach a court-enforceable agreement that will be overseen by an independent monitor.
During the negotiation process, the department remains interested in obtaining recommendations and information related to reforms from the public. The department continues to monitor the APD community hotline, which is available for both English and Spanish speakers, 1-855-544-5134 and the APD community email address.
The department’s full report on its investigation of APD and other related information can be found at the U.S. Attorney’s Office for the District of New Mexico website and at the department website . For more information about the Civil Rights Division, please visit the division website .
Former Chief Executive Officer of Lufthansa Subsidiary BizJet Pleads Guilty to Foreign Bribery ChargesRead the Press Release
The former president and chief executive officer of BizJet International Sales and Support Inc., a U.S.-based subsidiary of Lufthansa Technik AG with headquarters in Tulsa, Oklahoma, that provides aircraft maintenance, repair and overhaul services, pleaded guilty today for his participation in a scheme to pay bribes to foreign government officials.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Danny C. Williams Sr., of the Northern District of Oklahoma and Assistant Director in Charge Valerie Parlave of the FBI’s Washington Field Office made the announcement.
“The former CEO of BizJet, Bernd Kowalewski, has become the third and most senior Bizjet executive to plead guilty to bribing officials in Mexico and Panama to get contracts for aircraft services,” said Assistant Attorney General Caldwell. “While Kowalewski and his fellow executives referred to the corrupt payments as ‘commissions’ and ‘incentives,’ they were bribes, plain and simple. Though he was living abroad when the charges were unsealed, the reach of the law extends beyond U.S. borders, resulting in Kowalewski’s arrest in Amsterdam and his appearance in court today in the United States. Today’s guilty plea is an example of our continued determination to hold corporate executives responsible for criminal wrongdoing whenever the evidence allows.”
“I commend the investigators and prosecutors who worked together across borders and jurisdictions to vigorously enforce the Foreign Corrupt Practices Act,” said U.S. Attorney Williams. “Partnership is a necessity in all investigations. By forging and strengthening international partnerships to combat bribery, the Department of Justice is advancing its efforts to prevent crime and to protect citizens.”
Bernd Kowalewski, 57, the former President and CEO of BizJet, pleaded guilty today in federal court in Tulsa, Oklahoma, to conspiracy to violate the Foreign Corrupt Practices Act (FCPA) and a substantive violation of the FCPA in connection with a scheme to pay bribes to officials in Mexico and Panama in exchange for those officials’ assistance in securing contracts for BizJet to perform aircraft maintenance, repair and overhaul services.
Kowalewski was arrested on a provisional arrest warrant by authorities in Amsterdam on March 13, 2014, and waived extradition on June 20, 2014. Kowalewski is the third BizJet executive to plead guilty in this case. Peter DuBois, the former Vice President of Sales and Marketing, pleaded guilty on Jan. 5, 2012, to conspiracy to violate the FCPA and a substantive violation of the FCPA and Neal Uhl, the former Vice President of Finance, pleaded guilty on Jan. 5, 2012, to conspiracy to violate the FCPA. Jald Jensen, the former sales manager at BizJet, has been indicted for conspiracy as well as substantive FCPA violations and money laundering and is believed to be living abroad. Charges were unsealed against the four defendants on April 5, 2013.
According to court filings, Kowalewski and his co-conspirators paid bribes directly to foreign officials to secure aircraft maintenance repair and overhaul contracts, and in some instances, the defendants funneled bribes to foreign officials through a shell company owned and operated by Jensen. The shell company, Avionica International & Associates Inc., operated under the pretense of providing aircraft maintenance brokerage services but in reality laundered money related to BizJet’s bribery scheme. Bribes were paid to officials employed by the Mexican Policia Federal Preventiva, the Mexican Coordinacion General de Transportes Aereos Presidenciales, the air fleet for the Gobierno del Estado de Sinaloa, the air fleet for the Gobierno del Estado de Sonora and the Republica de Panama Autoridad Aeronautica Civil.
Further according to court filings, the co-conspirators discussed in e-mail correspondence and at corporate meetings the need to pay bribes, which they referred to internally as “commissions” or “incentives,” to officials employed by the foreign government agencies in order to secure the contracts. At one meeting, for example, in response to a question about who the decision-maker was at a particular customer organization, DuBois stated that a director of maintenance or chief pilot was normally responsible for decisions on where an aircraft went for maintenance work. Kowalewski then responded by explaining that the directors of maintenance and chief pilots in the past received “commissions” of $3,000 to $5,000 but were now demanding $30,000 to $40,000 in “commissions.” Similarly, in e-mail correspondence between Uhl, DuBois, Kowalewski, and several others, Uhl responded to a question about BizJet’s financial outlook if “incentives” paid to brokers, directors of maintenance, or chief pilots continued to increase industry wide, stating that they would “work to build these fees into the revenue as much as possible. We must remain competitive in this respect to maintain and gain market share.”
On March 14, 2012, the department announced that it had entered into a deferred prosecution agreement with BizJet, requiring that BizJet pay an $11.8 million monetary penalty to resolve charges related to the corrupt conduct. That agreement acknowledged BizJet’s voluntary disclosure, extraordinary cooperation, and extensive remediation in this case. In addition, the department announced on March 14, 2012, that BizJet’s indirect parent company, Lufthansa Technik AG, entered into an agreement with the department in which the department agreed not to prosecute Lufthansa Technik provided that Lufthansa Technik satisfies its obligations under the agreement for a period of three years.
This case is being investigated by the FBI’s Washington Field Office with substantial assistance form the Oklahoma Field Office. The department has worked closely with its law enforcement counterparts in Amsterdam, Mexico and Panama, and has received significant assistance from Germany and Uruguay. The Criminal Division’s Office of International Affairs has also provided assistance. This case is being prosecuted by Assistant Chief Daniel S. Kahn and Trial Attorney David Fuhr of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Kevin Leitch of the Northern District of Oklahoma.
Additional information about the Justice Department’s FCPA enforcement efforts can be found at www.justice.gov/criminal/fraud/fcpa .District Court Enters Permanent Injunction Against New York Dietary Supplement Maker to Prevent Distribution of Adulterated SupplementsRead the Press Release
The Justice Department announced today that the U.S. District Court for the Eastern District of New York has entered a consent decree of permanent injunction against Applied Polymer Systems dba APS Pharmaco (APS) and its president, Nuka Reddy, all of Lindenhurst, New York, to prevent the distribution of adulterated dietary supplements.
According to a complaint filed July 21, the defendants violated the Federal Food, Drug, and Cosmetic Act (FDCA) by manufacturing and distributing dietary supplements that were adulterated. Under the FDCA, dietary supplement manufacturers are required to have systems in place to ensure that their products meet specifications for identity, purity, strength and composition. The government’s actions resulted from a series of inspections of APS’ manufacturing facility beginning in 2012, which revealed, among other things, that APS failed to perform identity tests or examinations for certain dietary ingredients before using them in their products.
In conjunction with the filing of the complaint, the defendants agreed to settle the litigation and be bound by a consent decree of permanent injunction that prohibits them from committing violations of the FDCA. The consent decree requires the dietary supplement manufacturer to cease all operations and requires that if they wish to resume manufacturing dietary supplements in the future, the FDA first must determine that APS’ manufacturing practices have come into compliance with the law. The consent decree also requires a recall of all products sold since Jan. 1, 2014. The consent decree was filed with the complaint and was docketed on July 23.
The FDA referred this matter to the Department of Justice. The Consumer Protection Branch of the Justice Department’s Civil Division, together with the U.S. Attorney’s Office for the Eastern District of New York, brought this case on behalf of the United States.
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Admitted Gang Member Sentenced for Federal Racketeering ChargesRead the Press Release
Armando Jose Velasquez, aka “Money,” 27, of East Chicago, Indiana, was sentenced today to serve 305 months in prison on federal racketeering charges relating to a Dec. 3, 2011, attempted murder.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney David A. Capp for the Northern District of Indiana made the announcement. The sentence was imposed today by U.S. District Court Chief Judge Philip P. Simon.
According to court documents, on Dec. 3, 2011, Velasquez fired a gun into a car being driven by an 18-year-old resident of East Chicago, Indiana, and struck the victim three times. Velasquez believed that the victim was a rival gang member, but the victim was not actually a gang member and was not involved in any criminal activity. Velasquez had been previously convicted in the Lake County Superior Court in Indiana of voluntary manslaughter and sentenced to 12 years in prison in 2005 and was on state parole when he committed the offense.
Velasquez was part of a 24-defendant indictment alleging that members of the Imperial Gangsters committed 14 previously-uncharged homicides: 12 in East Chicago, Indiana, one in Hammond, Indiana, and one in Gary, Indiana. The indictment also charged a decade-long racketeering conspiracy that involved the attempted murder of 19 other victims and the large scale distribution of cocaine and marijuana.
Velasquez pleaded guilty on Jan. 10, 2014, to one count of conspiracy to participate in racketeering activity, attempted murder in aid of racketeering activity and a firearm offense relating to the Dec. 3, 2011, attempted murder. Velasquez is one of 22 defendants charged in the indictment to plead guilty. One defendant, Richard Reyes, was convicted by a jury of murder and conspiracy to commit racketeering activity on Jan. 24, 2014, and is scheduled to be sentenced on Sept. 30, 2014. The remaining defendant is scheduled for trial on Jan. 12, 2015.
An indictment is merely an accusation, and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives, the FBI, and the East Chicago Police Department, with assistance from the Gary Police Department, the Hammond Police Department and the Lake County High Intensity Drug Trafficking Area Program. This case is being prosecuted by Trial Attorney Bruce R. Hegyi of the Criminal Division’s Capital Case Section and Assistant U.S. Attorney David J. Nozick of the Northern District of Indiana.$80 Million Judgment Entered Against BNP Paribas for False Claims to the U.S. Department of AgricultureRead the Press Release
The Department of Justice announced today that an $80 million False Claims Act judgment was entered against BNP Paribas for submitting false claims for payment guarantees issued by the U.S. Department of Agriculture (USDA). BNP Paribas is a global financial institution headquartered in Paris.
“We will not tolerate the misuse of taxpayer funded programs designed to help American businesses,” said Assistant Attorney General for the Justice Department’s Civil Division Stuart F. Delery. “Companies that abuse these programs will be held accountable.”
The United States filed a lawsuit against BNP Paribas in connection with its receipt of payment guarantees under USDA’s Supplier Credit Guarantee (SCG) Program. The program provided payment guarantees to U.S.-based exporters for their sales of grain and other agricultural commodities to importers in foreign countries. The program encouraged American exporters to sell American agricultural commodities to foreign importers and covered part of the losses if the foreign importers failed to pay. The SCG Program regulations provided that U.S. exporters were ineligible to participate in the SCG Program if the exporter and foreign importer were under common ownership or control.
The judgment entered by the court resolves the government’s allegations that, from 1998 to 2005, BNP Paribas participated in a sustained scheme to defraud the SCG Program. In furtherance of the scheme, American exporters and Mexican importers who were under common control improperly obtained SCG Program export credit guarantees for transactions between the affiliated exporters and importers. In some cases, the underlying transactions were shams and did not involve any real shipment of grain. BNP Paribas accepted assignment of the credit guarantees from the American exporters, even though it knew that the affiliated exporters and importers were ineligible for SCG Program financing, and a BNP Paribas vice-president, Jerry Cruz, received bribes from the exporters. Beginning in April 2005, when the Mexican importers began defaulting on their payment obligations, BNP Paribas submitted claims to the USDA for the resulting losses.
On Jan. 20, 2012, Cruz pleaded guilty to conspiracy to commit bank fraud, mail fraud and wire fraud, and conspiracy to commit money laundering.
“I would like to thank the Department of Justice and the USDA General Counsel’s office for their collaboration in recovering $80 million under this judgment,” said Administrator of USDA’s Foreign Agricultural Service Phil Karsting. “This illustrates the importance USDA and this administration places on protecting the integrity of our programs.”
The resolution of this matter was the result of a coordinated effort among the Commercial Litigation Branch of the Justice Department’s Civil Division, the USDA, the USDA Office of Inspector General, the U.S. Postal Inspection Service and the Internal Revenue Service Criminal Investigation.
The lawsuit is captioned United States v. BNP Paribas SA, et al., No. 4:11 cv 3718 (S.D. Tex.).
Three Defendants Arrested on Charges of Providing Material Support to a Foreign Terrorist OrganizationRead the Press Release
Three defendants were arrested today on charges of providing material support to al-Shabaab, a designated foreign terrorist organization that is conducting a violent insurgency campaign in Somalia. Two additional defendants are fugitives in Kenya and Somalia.
Assistant Attorney General John P. Carlin of the Justice Department’s National Security Division, U.S. Attorney Dana J. Boente for the Eastern District of Virginia, Assistant Director in Charge Valerie Parlave of the FBI’s Washington, D.C. Field Office and Special Agent in Charge Frank Montoya, Jr. of the FBI’s Seattle Field Office, made the announcement.
A superseding indictment was issued on June 26, 2014, by a federal grand jury in the Eastern District of Virginia, charging the defendants with one count of conspiracy to provide material support to a foreign terrorist organization and 20 counts of providing material support to a foreign terrorist organization. The indictment was unsealed after the following arrest warrants were executed today:
Muna Osman Jama , 34, was arrested at her home in Reston, Virginia;
Hinda Osman Dhirane , 44, was arrested at her home in Kent, Washington;
Farhia Hassan was arrested at her residence in the Netherlands;
Fardowsa Jama Mohamed is a fugitive in Kenya and the subject of a pending arrest warrant; and
Barira Hassan Abdullahi is a fugitive in Somalia and the subject of a pending arrest warrant.
If convicted, each defendant faces a maximum penalty of 15 years in prison on each count in the indictment.
The Harakat Shabaab al-Mujahidin, commonly known as al-Shabaab, is a terrorist group conducting a violent insurgency campaign in Somalia. In 2008, the U.S. government designated al-Shabaab as a foreign terrorist organization, and in February 2012, the leaders of al-Shabaab and the terrorist group al-Qa’ida publicly announced the merger of the two groups.
According to court records, defendants Muna Osman Jama and Hinda Osman Dhirane were the leaders of an al-Shabaab fundraising conspiracy operating in the United States, Kenya, the Netherlands, Somalia and elsewhere. Jama and Dhirane allegedly directed a network composed primarily of women who provided monthly payments that were coordinated, facilitated and tracked by the defendants to their conduits in Kenya and Somalia. According to court records, Jama was principally responsible for sending money to Kenya through her conduit, defendant Fardowsa Jama Mohamed, while Dhirane was primarily responsible for sending money to Somalia through her conduit, defendant Barira Hassan Abdullahi.
According to court records, the defendants would refer to the money they sent overseas as “living expenses,” and they repeatedly used code words such as “orphans” and “brothers in the mountains” to refer to al-Shabaab fighters, and “camels” to refer to trucks needed by al-Shabaab. The money transfers often were broken down into small amounts as low as $50 or $100, and the funds were intended for use by al-Shabaab insurgents operating in Somalia.
This case was investigated bythe FBI’s Washington, D.C. and Seattle Field Offices. The Justice Department’s Office of International Affairs also played an essential role in coordinating the arrests and searches with foreign authorities.
Assistant U.S. Attorney James P. Gillis and Trial Attorney Danya E. Atiyeh of the Counterterrorism Section of the Justice Department’s National Security Division are prosecuting the case in the Eastern District of Virginia. The U.S. Attorney’s Office in Seattle also provided assistance.
Criminal indictments are only charges and not evidence of guilt. A defendant is presumed to be innocent until and unless proven guilty.Owner and Administrator of Miami Home Health Companies Pleads Guilty for Role in $74 Million Health Care Fraud SchemeRead the Press Release
A Miami resident who owned a home health care company and was the administrator of another home health care company pleaded guilty today for her participation in a $74 million Medicare fraud scheme.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Special Agent in Charge George L. Piro of the FBI’s Miami Field Office and Acting Special Agent in Charge Ryan Lynch of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), Office of Investigations Miami Office made the announcement.
Elsa Ruiz, 45, pleaded guilty today before U.S. District Judge Marcia G. Cooke in the Southern District of Florida to one count of conspiracy to commit health care fraud. Her sentencing is scheduled for Oct. 8, 2014.
According to court documents, Ruiz was an owner of Professional Home Care Solutions Inc. (Professional Home Care) and an administrator of LTC Professional Consultants Inc. (LTC), Miami home health care agencies that purported to provide home health and therapy services to Medicare beneficiaries. Ruiz and her co-conspirators operated LTC and Professional Home Care for the purpose of billing the Medicare program for, among other things, expensive physical therapy and home health care services that were not medically necessary and/or were not provided.
Also according to court documents, Ruiz ran and oversaw the schemes operating out of LTC and Professional Home Care. Ruiz and co-conspirators paid kickbacks and bribes to patient recruiters, who provided patients to LTC and Professional Home Care , as well as prescriptions, plans of care (POCs) and certifications for medically unnecessary therapy and home health services for Medicare beneficiaries. Ruiz and her co-conspirators used these prescriptions, POCs and medical certifications to fraudulently bill the Medicare program for unnecessary home health care and therapy services.
From approximately January 2006 to June 2012, LTC and Professional Home Care submitted approximately $74 million in claims for home health care services that were not medically necessary and/or not provided, and Medicare paid approximately $45 million on those claims.
The case was investigated by the FBI and HHS-OIG, and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. The case is being prosecuted by Assistant Chief Joseph S. Beemsterboer of the Criminal Division’s Fraud Section.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 1,900 defendants who have collectively billed the Medicare program for more than $6 billion. In addition, the HHS Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers. To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov .Armed Forces Communications and Electronics Association (AFCEA) Marianas Tech Net 2014 Invites U.S.Attorney's Office to ParticipateRead the Press Release
ALICIA A.G. LIMTIACO, U.S. Attorney for the Districts of Guam and the Northern Mariana Islands (NMI), and JOSEPH QUITANO, National Security Specialist for the U.S. Attorney's Office (USAO), were invited to speak at the Armed Forces Communications and Electronics Association (AFCEA) Marianas TECH NET 2014 Conference, held on April22-25, 2014, in Guam. The AFCEA is an international organization "dedicated to increasing knowledge through the exploration of issues relevant to its members in information technology, communications, and electronics for the defense, homeland security and intelligence communities."
U.S. Attorney Limtiaco spoke about the mission of the USAO, which is "to enforce the law and defend the interests of the United States according to the law; to ensure public safety against threats foreign and domestic; to provide federal leadership in preventing and controlling crime; to seek just punishment for those guilty of unlawful behavior; and to ensure fair and impartial administration of justice for all Americans." She explained that there are 42 separate components of the Department of Justice and provided information on the roles of the agencies, including the United States Attorneys, who prosecute offenders and represent the United States government in court; the National Security Division, which coordinates the Department's highest priority of combating terrorism and protecting national security; the major investigative agencies - the Federal Bureau of Investigation, the Drug Enforcement Administration, and the Bureau of Alcohol, Tobacco, Firearms and Explosives - which prevent and deter crime and arrest criminal suspects; the United States Marshals Service, which protects the federal judiciary, apprehends fugitives, and detains persons in federal custody; and the Federal Bureau of Prisons, which confines convicted offenders.
U.S. Attorney Limtiaco also expounded on the United States Attorney General's priority goals, which are to detect and prevent terrorism; prosecute violent crime; combat computer crime, especially child pornography, obscenity, and intellectual property theft; prevent and prosecute illegal drugs; combat corporate and public corruption; and promote civil rights and civil liberties.
National Security Specialist Joe Quitano discussed regional security issues relevant to the national security of the United States. National Security Specialist Quitano also spoke about the Department of Justice's past and current prosecutions involving threats of terrorism to federal, state, and local levels and threats of Weapons of Mass Destruction (WMDs). In addition, he presented information on important elements that make up the country’s national security, current events that affect national security, information specific to Guam and the Northern Mariana Islands' vital role in contributing to national security, and tips on what citizens can do to help prevent threats of terrorism.
The following are photographs of U.S. Attorney Limtiaco and National Security Specialist
Joe Quitano giving remarks at the AFCEA Marianas TECH NET 2014 Conference:United States Intervenes in Whistleblower Suit Against Symantec Corporation Alleging False Claims for Computer SoftwareRead the Press Release
The United States has intervened in a law suit against Symantec Corporation, alleging that Symantec submitted false claims to the United States on a General Services Administration (GSA) software contract, the Justice Department announced today. Symantec is a Fortune 500 company located in Mountain View, California, and it sells a variety of computer security products.
“This lawsuit demonstrates the government’s commitment to ensuring that the companies it does business with act with integrity,” said Assistant Attorney General Stuart Delery for the Department of Justice’s Civil Division. “When the United States spends taxpayer dollars based on contractors’ representations about their business practices, we expect to be given complete and accurate information.”
In 2007, Symantec entered into a Multiple Award Schedule contract with GSA that allowed Symantec to sell software and related items directly to federal purchasers. The case alleges that Symantec knowingly provided the United States with inaccurate and incomplete information about the prices it was offering to its commercial customers during the negotiation and performance of the contract. GSA used Symantec’s disclosures about its commercial sales practices to negotiate the minimum discounts Symantec was required to provide government agencies that bought Symantec software. In addition, the contract required Symantec to update GSA when commercial discounts improved and extend the same improved discounts to government purchasers. The suit contends that Symantec misrepresented its true commercial sales practices, ultimately leading to government customers receiving discounts far inferior to those Symantec gave to its commercial non-government customers. The contract at issue was in place from 2007 to 2012 and involved hundreds of millions of dollars in sales.
“When doing business with the government, honesty and transparency are essential,” said U.S. Attorney Ronald C. Machen Jr. for the District of Columbia. “We are committed to ensuring that contractors who do business with the federal government provide honest services, prices and products. We will continue to work with relators and federal investigators to protect federal taxpayer money.”
“Contractors cannot provide GSA with inaccurate and incomplete pricing data,” said GSA Acting Inspector General Robert C. Erickson. “American taxpayers deserve a fair deal.”
The suit was filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private parties to sue on behalf of the government for the submission of false claims for government funds and to receive a share of any recovery. The False Claims Act also permits the government to intervene in such lawsuits, as it has done in this case. The lawsuit is pending in the District of Columbia.
This matter was investigated by the Civil Division’s Commercial Litigation Branch, the U.S. Attorney’s Office for the District of Columbia and GSA’s Office of Inspector General .
The case is captioned United States ex rel. Morsell v. Symantec Corp. , No. 12cv00800 (D.D.C.). The claims asserted against Symantec are allegations only; there has been no determination of liability.
Statement by Justice Department Spokesperson on King V. Burwell and Halbig V. BurwellRead the Press Release
WASHINGTON—The Department of Justice released the following statement Tuesday from spokesperson Emily Pierce regarding the ruling in the case of King v. Burwell by the Fourth Circuit Court of Appeals and the ruling by the D.C. Circuit Court of Appeals in the case of Halbig v. Burwell:
“Today, the Fourth Circuit unanimously ruled in support of Congressional intent and common sense: that an American may receive tax credits to make health care more affordable regardless of whether they are participating in a state-run or a federally-facilitated marketplace. While two appeals judges ruled differently, four appeals judges have now cast their votes with two lower courts, Congress, and the Affordable Care Act. In the meantime, to be clear, people getting premium tax credits should know that nothing has changed, tax credits remain available.”
President Announces New AmeriCorps Partnerships to Expand Opportunities to YouthRead the Press Release
As part of his My Brother’s Keeper initiative, President Obama announced new AmeriCorps partnerships with federal agencies and the private sector to connect young people to mentoring, support networks and job skills to help them reach their full potential.
Monday’s announcement altogether represents a total of $24 million in investments in national service. The Departments of Justice and Agriculture (USDA) are joining with the Corporation for National and Community Service (CNCS) to launch new AmeriCorps programs and partnerships that total up to $14 million over three years. Private sector commitments from AT&T and Citi Foundation will support additional AmeriCorps service opportunities that provide young people with skills and supports to successfully enter the workforce.
“America’s future will be defined, and our progress determined, by the doors we open and the support we offer to young people across the nation,” said Attorney General Eric Holder. “My Brother’s Keeper, and innovative initiatives like this one, must be a central part of this work. By involving young people in service projects and offering them the benefits of mentorship – through programs like AmeriCorps – we can help our kids mature into responsible, confident, and productive young adults. And we can do our part to ensure that every child, from every background, has the tools they need to learn, to grow, to thrive – and to lead.”
CNCS and the Department of Justice’s Office of Juvenile Justice and Delinquency Prevention (OJJDP) are jointly funding Youth Opportunity AmeriCorps . The program, which totals up to $10 million over three years, will enroll disconnected youth in national service programs as AmeriCorps members. It includes a mentorship component that will provide critical mentoring support to the AmeriCorps members.
USDA and CNCS have joined in a landmark new partnership between AmeriCorps and the USDA’s Forest Service that connects youth and veterans with service opportunities to restore the nation’s forests and grasslands. The $3.8 million in joint funding will provide resources for both AmeriCorps grantees and member organizations of the 21 st Century Conservation Service Corps (21CSC), and will also provide for 300 new AmeriCorps members serving in U.S. forests and grasslands.
The commitments announced today support the My Brother’s Keeper initiative by increasing entry-level job, mentorship and apprenticeship options for all young people, including boys and young men of color. They also advance the goals of the President’s Task Force on Expanding National Service , which calls for new public-private partnerships that use national service to help solve our nation’s most pressing challenges.
“As a nation, there is much more we can do to help our young people stay on track and reach their full potential in life,” said CEO of CNCS Wendy Spencer. “AmeriCorps is a proven pathway to opportunity that provides skills, leadership, and college support for young people. We are thrilled to join with our federal and corporate partners to launch new AmeriCorps programs that will put hundreds of young people on a path to success in school and life.”
“This landmark partnership between the Forest Service and USDA with AmeriCorps and the Corporation for National and Community Service provides youth and veterans with new job skills while helping to restore America's forests and grasslands,” said U.S. Secretary of Agriculture Tom Vilsack. “The administration's continued support for the 21 st Century Conservation Service Corps furthers President Obama's goals of expanding economic opportunity, creating new ways to engage in service projects, and reconnecting Americans to the great outdoors.”
In addition to new federal partnerships, the White House announced additional AmeriCorps commitments from the private sector to support the goals of My Brother’s Keeper. AT&T is launching the Aspire Mentoring Academy Corps , powered by AmeriCorps, AT&T and MENTOR: The National Mentoring Partnership. The program will engage AmeriCorps members in regions around the country and engage thousands of youth from underserved communities in mentoring activities.
“Research shows that the presence of a mentor in a young person’s life significantly improves their potential for success,” said AT&T Chairman and CEO Randall Stephenson. “That’s why I and many of our employees are currently mentoring students across the country.”
Citi Foundation is making a three-year, $10 million commitment to create ServiceWorks , a groundbreaking national program powered by AmeriCorps and Points of Light that uses volunteer service to help 25,000 young people in 10 cities across the United States develop the skills they need to prepare for college and careers. The program, which will deploy 225 AmeriCorps VISTA members over three years, will engage youth ages 16-24 in service and build a large-scale volunteer response to the crisis of low college and career attainment. The young people will receive training in critical 21 st century leadership and workplace skills, the chance to build their networks and connections to their communities, and the opportunity to use their new skills by participating in and leading volunteer service projects.
AmeriCorps members serving in these programs, most of whom will be youth from underserved communities, will earn education scholarships to help pay for college or repay their student loans – putting them on track for greater economic opportunity in the future.
On Feb. 27, 2014, President Obama launched the My Brother’s Keeper initiative to address persistent opportunity gaps faced by boys and young men of color and to ensure that all young people can reach their full potential. The president’s My Brother’s Keeper Federal Task Force released a 90-day report on May 30, which identified starting points for what will be an enduring effort at improving the life outcomes for our youth, including boys and young men of color.
As part of this effort, CNCS joined joining with other federal agencies and nonprofit organizations to launch a campaign to recruit individuals to serve as mentors to boys and young men of color across the country. The United We Serve website includes a database of mentoring opportunities searchable by zip code.
Maryland Man Sentenced to 20 Years in Prison for Sex Trafficking ConspiracyRead the Press Release
U.S. District Court Judge Paul W. Grimm sentenced Jean Claude Roy, aka Dredd the Don, 31, of Germantown, Maryland, to serve 240 months in prison to be followed by 10 years of supervised release, the Justice Department announced today. A jury convicted Roy on March 19, 2014, of conspiracy to commit sex trafficking by force, fraud and coercion, three counts of interstate transportation for the purpose of prostitution, and one count of witness and evidence tampering.
“The Civil Rights Division is committed to pursuing justice on behalf of vulnerable members of our society,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division. “This sentence sends a clear message that the United States will not tolerate modern-day slavery and will work tirelessly to restore the rights and dignity of its victims.”
During the trial, victims recounted their fear of Roy, explaining instances of physical and sexual abuse, threats, tattoo branding and Roy’s bragging of beating a murder charge years prior in Massachusetts. “If he could kill a man, who’s gonna care about a prostitute,” said one victim from the witness stand. Witnesses detailed the guns in Roy’s possession and how he prostituted women in Maryland, Virginia and North Carolina.
“Jean Claude Roy preyed on vulnerable young women,” said U.S. Attorney Rod J. Rosenstein for the District of Maryland. “Law enforcement agencies will continue to work to identify and prosecute human traffickers.”
“This case serves as another chilling example of the callous disregard for human life demonstrated by traffickers,” said U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigation’s (HSI) Baltimore Deputy Special Agent in Charge James P. Nagle. “Our special agents will continue pursuing these criminals to ensure they are behind bars where they can no longer exploit the innocent.”
Trial evidence also showed that from Jan. 1 through Jan. 10, 2013, while Roy was in jail on related state charges, he called a family member several times and had that person access online accounts and storage services belonging to Roy and his co-conspirator in order to erase evidence related to these charges.
The jury acquitted Roy of one count of sex trafficking and two counts of attempted sex trafficking by force, fraud and coercion, and for the related counts of brandishing a firearm during a crime of violence.
This case was investigated by the Maryland Human Trafficking Task Force, which was formed in 2007 to discover and rescue victims of human trafficking while identifying and prosecuting offenders. Members include federal, state and local law enforcement, as well as victim service providers and local community members. For more information about the Maryland Human Trafficking Task Force, please visit the task force website.
Report suspected instances of human trafficking to ICE HSI’s tip line at 866-DHS-2ICE (1-866-347-2423) or by completing its online tip form. Both are staffed around the clock by investigators.
This case was investigated by ICE HSI Baltimore and the Montgomery County Police Department. Assistant U.S. Attorney Kristi N. O’Malley and Trial Attorney William E. Nolan of the Civil Rights Division’s Human Trafficking Prosecution Unit prosecuted the case.
Justice Department to Announce Results and Next Steps in Investigation of Newark Police DepartmentRead the Press Release
The Department of Justice Civil Rights Division and the U.S. Attorney’s Office for the District of New Jersey will announce the results and next steps following its investigation into the Newark Police TODAY, TUESDAY, JULY 22, 2014, at 12:00 p.m. EDT, at the Newark office of the U.S. Attorney for the District of New Jersey. The investigation, opened in May 2011, looked at allegations of use of excessive force and discriminatory policing among other issues.
WHO: Acting Assistant Attorney General for the Civil Rights Division Jocelyn Samuels, U.S. Attorney Paul J. Fishman for the District of New Jersey, Newark Mayor Ras Baraka, and Newark Police Director Eugene Venable
WHAT: Press Conference to announce results of the Justice Department’s investigation into the Newark Police Department
WHEN: TUESDAY, JULY 22, 2014, at 12:00 p.m. EDT
WHERE: U.S. Attorney’s Office for the District of New Jersey970 Broad Street, Seventh Floor, Newark, New Jersey, OPEN PRESS
NOTE: All media must present government-issued photo I.D. (such as driver’s license) as well as valid media credentials. Press inquiries regarding logistics should be directed to Rebekah Carmichael or Matt Reilly at 973-645-2888 or [email protected].
Justice Department Reaches Agreement with City of Newark, New Jersey, to Address Unconstitutional Policing in Newark Police DepartmentRead the Press Release
The Justice Department today announced it has reached an agreement with the city of Newark, New Jersey, to address a pattern and practice of unconstitutional policing by the Newark Police Department (NPD). The agreement follows a joint investigation by the Justice Department’s Civil Rights Division and the U.S. Attorney’s Office for the District of New Jersey, the results of which were also released today.
The findings, detailed in a report provided to the city and to NPD leadership, document the NPD’s pattern or practice of constitutional violations in its stop and arrest practices; its response to individuals exercising their rights under the First Amendment; its use of force; and through theft by officers. The investigation also revealed deficiencies in NPD systems that are designed to prevent and detect misconduct.
The city of Newark cooperated with the investigation, which began on May 9, 2011, and has agreed to enter into a court-enforceable, independently monitored agreement to reform the NPD to ensure constitutional policing. The terms of the agreement are outlined in the agreement in principle released today. Among other things, the NPD must continue to develop and implement improvements to its stop, arrest and force policies and procedures, and to train its officers on how to conduct effective and constitutional policing. The NPD also must implement systems that ensure accountability, commit to building police-community partnerships and improve the quality of policing throughout the city.
“Our investigation uncovered troubling patterns in stops, arrests and use of force by the police in Newark. With this agreement, we’re taking decisive action to address potential discrimination and end unconstitutional conduct by those who are sworn to serve their fellow citizens,” said Attorney General Eric Holder. “This action reaffirms the Justice Department’s commitment to working with our law enforcement partners in order to ensure the highest standards of integrity and professionalism. Under today’s agreement, Newark police officials are taking the first in a series of important steps to restore public trust in their department and ensure both the safety and the civil rights of Newark residents.”
“Today the city of Newark has taken a bold step toward ensuring constitutional policing that better serves all of Newark’s residents,” said Acting Assistant Attorney General for the Civil Rights Division Jocelyn Samuels. “The Department of Justice report released today makes clear the depth and breadth of the challenges Newark faces in reforming its police department; but the agreement in principle provides a roadmap for reform and underscores the shared determination of the city of Newark and the Department of Justice to making this reform real and sustainable.”
“The people of Newark deserve to be safe, and so do the thousands who come here to work, to learn, and to take advantage of all the city has to offer,” said U.S. Attorney Fishman. “They also need to know the police protecting them are doing that important – and often dangerous – work while respecting their constitutional rights. The Justice Department has a long history of making sure of that, and today we have the commitment of Newark's mayor and the leadership of the police department to make the department the one that the city deserves.”
During the investigation, the Justice Department reviewed thousands of NPD documents, including written policies and procedures, documentation of stops, searches and arrests, internal investigation files and use of force reports and reviews. Attorneys and investigators also interviewed NPD officers, supervisors and command staff, as well as city officials, and met with hundreds of community members and local advocates.
As the report describes, the Justice Department found reasonable cause to believe that the NPD has engaged in a pattern or practice of unconstitutional stops in violation of the Fourth Amendment. Specifically, NPD officers failed to articulate sufficient justification for nearly 75 percent of pedestrian stops. NPD officers also disproportionately stopped black people relative to their representation in Newark’s population. Although the NPD’s reports were insufficient to allow the Justice Department to determine whether this disparity was the result of intentional discrimination or was otherwise unlawful, the report urges the city of Newark and NPD to improve its collection and analysis of its stop, search and arrest data to facilitate a more thorough analysis of the racial and ethnic impacts of NPD’s police practices and to take steps to eliminate avoidable disparities.
Through the course of the investigation, the Justice Department also found that NPD officers have detained and arrested individuals who lawfully objected to police actions or behaved in a way that officers perceived as disrespectful, in violation of the First Amendment.
In addition, the Justice Department found cause to believe that the NPD engaged in a pattern or practice of the use of excessive force. The NPD has been unable to make reliable conclusions about whether a particular use of force was reasonable due to substantial underreporting and inadequate investigation of the use of force by NPD officers. Nonetheless, of the incidents reviewed as part of the Justice Department’s investigation, more than 20 percent of NPD officers reported use of force that appeared unreasonable.
The investigation also found a pattern or practice of theft of citizens’ property by NPD officers in violation of the Fourth and 14 th Amendments, including by officers in NPD’s specialized units, such as the narcotics and gang units, and at NPD’s prisoner processing unit.
The Justice Department’s report details other inadequacies that contributed to a pattern of constitutional violations. Deficiencies were found in Internal Affairs (IA) processes, in investigations reviewing use of force and complaints regarding officer misconduct, in supervision and management, and in the training of officers and IA investigators.
The Justice Department conducted its investigation jointly through the Special Litigation Section of the Civil Rights Division and the U.S. Attorney’s Office for the District of New Jersey, with the assistance of law enforcement and statistics experts.
Both the report and the agreement in principle, along with summaries of each, will be available on the Civil Rights Division website .
Former Maryland Correctional Officer Sentenced in Connection with Series of Assaults on InmateRead the Press Release
James Kalbflesh, a former correctional officer at the Roxbury Correctional Institution (RCI) in Hagerstown, Maryland, was sentenced today in connection with the March 9, 2008, assault of Kenneth Davis, an inmate. U.S. District Judge James K. Bredar sentenced Kalbflesh to serve 60 months in prison.
Kalbflesh was found guilty by a federal jury of conspiracy against rights, deprivation of rights under color of law and conspiracy to obstruct justice. Evidence at trial and in court documents filed in connection with his convictions established that Kalbflesh and other officers at RCI met during the midnight shift and agreed to assault Davis in retaliation for a prior incident involving Davis and another officer. Kalbflesh and other officers then entered Davis’ cell and assaulted him.
Davis was also subjected to retaliatory assaults by officers from the preceding and following shifts. Davis suffered facial fractures, a broken rib and fractured vertebrae, among other injuries, as a result of the series of assaults. The assaults by Kalbflesh and other RCI officers resulted in serious injuries that left Davis unrecognizable. Kalbflesh is the last remaining officer to be sentenced in the related RCI cases.
“Sixteen former correctional officers from RCI have been convicted and sentenced for their involvement in the series of beatings of an inmate, and in the coordinated cover-ups that followed each assault,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division. “These officers betrayed the public trust by using their official positions to commit violent civil rights abuses and then tried to cover up their crimes. The Department of Justice will continue to prosecute vigorously correctional officers who use their power to violate federal law.”
The case was investigated by the Frederick Resident Agency of the FBI, and prosecuted by Special Litigation Counsel Forrest Christian and Trial Attorney Sanjay Patel of the Civil Rights Division.
Australian Man Pleads Guilty in Las Vegas to Biofuels Fraud SchemeRead the Press Release
Nathan Stoliar, 64, of Australia, pleaded guilty in federal court in Las Vegas today to five felonies for his role in multiple schemes, worth in excess of $41 million, to generate fraudulent biodiesel credits and to export biodiesel without providing biodiesel credits to the United States as required by law.
Stoliar and another defendant had been charged in January 2014 in a 57-count indictment alleging conspiracy, wire fraud, false statements under the Clean Air Act, obstruction of justice and conspiracy to engage in money laundering. Following his indictment, Stoliar’s arrest was sought by the United States. Located in Poland, Stoliar returned in early February to the United States to surrender for arrest. Stoliar pleaded guilty Tuesday to one count of conspiracy, one count of conspiracy to engage in money laundering, two counts of wire fraud and one count of making false statements under the Clean Air Act. Stoliar is required by the plea to forfeit $4 million and pay $1 million in restitution. He faces a maximum sentence of 20 years in prison and a $500,000 fine for each count of conspiracy to engage in money laundering and wire fraud, five years in prison and a $250,000 fine for conspiracy, and two years in prison and a $250,000 fine for making false statements under the Clean Air Act.
“Stoliar and his co-conspirator perpetrated a massive fraud against a renewable fuels program created to protect our nation’s energy security and independence,” said Sam Hirsch, Acting Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division. “The Justice Department will continue to pursue fraudsters at home and abroad and protect the integrity of federal programs as it protects the environment.”
“By rooting out fraud, EPA is committed to achieving the environmental goals that Congress envisioned when it created the Renewable Fuel Standard,” said Cynthia Giles, the U.S. Environmental Protection Agency’s (EPA) Assistant Administrator for Enforcement and Compliance Assurance. “This case, like other recent ones, supports legitimate businesses and makes clear to potential violators that EPA and its partners will fight to protect the program’s integrity.”
“With this guilty plea, the defendant admitted that he participated in a conspiracy to defraud the United States government, specifically the EPA, and that he personally gained more than $7 million from the scheme,” said U.S. Attorney Dan Bogden for the District of Nevada. “These types of schemes are complex and require an enormous expenditure of resources to investigate and prosecute. Because of the tremendous work of the investigators and prosecutors on this case, we were also able to seize and forfeit from the defendant millions of dollars from bank accounts, as well as real property in Nevada and California, jewelry and other assets.”
The Energy Independence and Security Act of 2007 created a number of federally-funded programs that provided monetary incentives for the production and use of renewable fuels such as biodiesel in the United States. Biodiesel producers and importers can generate and attach credits known as “renewable identification numbers,” or RINs. to the gallons of biodiesel they produce or import. Because certain companies (such as companies that sell transportation fuel in the United States) need RINs to comply with regulatory obligations, RINs have significant market value. They are routinely bought and sold in the marketplace. In addition, to ensure that RINs are generated for renewable fuel used only in the United States, and in order to create an incentive for biodiesel in the United States to be used here, anyone who exports biodiesel is required to obtain these valuable RINs for all exported gallons and provide the RINs to EPA.
Stoliar admitted that beginning around September of 2009, he and co-defendant James Jariv operated and controlled a company -- City Farm Biofuel in Vancouver, British Columbia, Canada -- that represented itself as a producer of biodiesel from “feedstocks” such as animal fat and vegetable oils. Stoliar and Jariv also formed a company called Canada Feedstock Supply – that represented itself as City Farm’s supplier of feedstocks necessary to produce biodiesel. Jariv operated and controlled a company based in Las Vegas called Global E Marketing (GEM). Using these three and other closely-held companies, Stoliar and his codefendants claimed to produce biodiesel at the City Farm facility and to import and sell biodiesel to GEM, and then generated and sold RINs based upon this claimed production, sale and importation. In reality, no biodiesel produced at City Farm was ever imported and sold to GEM as claimed. Stoliar and his codefendants used GEM to claim to blend the biodiesel with petroleum diesel, allowing them to sell the RINs separately from any actual biodiesel. Using this scheme, Stoliar and his co-defendants falsely claimed to import, purchase and blend more than 4.2 million gallons of biodiesel. They then sold the RINs, and fraudulently generated more than $7 million.
The indictment also alleges that, beginning around the same time period and continuing through Dec. 31, 2013, Stoliar and Jariv, using their company MJ Biodfuel, bought over 23 million gallons of RIN-less biodiesel that had been blended with small amounts of petroleum diesel to form B-99. The defendants bought the B-99 from unrelated companies in the United States, and this B-99 had been used by other companies to generate and separate RINs from the fuel. Because B-99 cannot be used to again generate a RIN, and because it cannot be used for other tax-related incentives, B-99 sells for substantially less than 100 percent biodiesel (known as B-100). Stoliar sold some of this biodiesel to purchasers in the United States, claiming it was B-100 produced at the City Farm facility and imported into the United States. By claiming this biodiesel was B-100 and not RIN-less B-99, Stoliar marketed the fuel as eligible to be used by purchasers to generate credits and incentives, and Stoliar was able to sell the fuel for as much as $2.30 per gallon more than he otherwise would have been able.
Stoliar and his co-defendants also exported significant amounts of the RIN-less B-99 they bought in the United States to Canada. Stoliar then sold the biodiesel in Canada, and conspired with his co-defendants to not acquire and provide RINs to the United States for these exports as they were required to do by law. In doing so, Stoliar and Jariv failed to give to the United States RINs worth in excess of $34 million, keeping this money for themselves instead.
Finally, Stoliar and Jariv conspired to launder the proceeds of their crimes, utilizing foreign banking institutions and complex financial transactions to promote their illegal schemes and distribute the proceeds of their crimes. Accounts were utilized in Canada, Nevada and Australia, and transactions between the defendants’ closely-held companies were described as other legitimate transactions involving biodiesel, when in reality they were not.
Sentencing for Stoliar has been set for Oct. 30,2014 in Las Vegas, Nevada. The investigation that led to today’s plea was the result of collaborative work by the EPA’s Criminal Investigation Division and the FBI, with assistance from the United States Secret Service, the Internal Revenue Service-Criminal Investigations and the Department of Homeland Security.
The case is being prosecuted by Assistant Chief Wayne D. Hettenbach of the Environmental Crimes Section of the Justice Department’s Environment and Natural Resources Division , Assistant U.S. Attorney’s Crane M. Pomerantz and Daniel D. Hollingsworth of the U.S. Attorney’s Office in Nevada, and Assistant Deputy Chief Darrin L. McCullough of the Justice Department’s Criminal Division, Asset Forfeiture and Money Laundering Section, with the assistance of the Justice Department’s Office of International Affairs and the United States Attorney’s Office for the Southern District of Texas .Unlicensed Trader Pleads Guilty in Los Angeles for Role in Fraudulent High Yield Investment Program SchemeRead the Press Release
An unlicensed trader who solicited $500,000 from undercover FBI agents to invest in a fraudulent high yield investment program pleaded guilty today in federal court in Los Angeles.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney André Birotte Jr. of the Central District of California and Assistant Director in Charge Bill Lewis of the FBI’s Los Angeles Field Office made the announcement.
Jessie Tolbert, 38, of Bastrop, Louisiana, pleaded guilty today to one count of conspiracy to commit wire fraud and one count of wire fraud. He is scheduled to be sentenced on Oct. 20, 2014.
According to court documents, in December 2011, Tolbert and his co-conspirators, including Eriq Brye and Greg Preston, placed an advertisement online for an investment opportunity. Undercover federal agents responded to this advertisement. During several weeks of email and telephone communications, Tolbert and his co-conspirators informed the agents that a spot recently had opened up on a high yield investment program they purportedly were running and that a $500,000 investment in their program would generate $30 million in 30 days. Tolbert did not actually run an investment program.
In an effort to induce the undercover agents to invest in the program, Tolbert and his co-conspirators made numerous material misrepresentations. Specifically, Tolbert falsely and repeatedly guaranteed the success of the proposed trade based on his purported past success in generating similar returns in comparable trades, as well as his success in other investments in the financial industry. Tolbert had never applied for, nor received, a license with any federal agency related to the financial industry.
Brye is a fugitive. Preston pleaded guilty in May 2013 for conduct including his role in this investment scheme. He is scheduled to be sentenced on December 19, 2014.
An indictment is merely an allegation, and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
This case was investigated by the FBI and prosecuted by Assistant Chief Benton Curtis and Trial Attorneys Kyle Maurer and Alex Porter of the Criminal Division’s Fraud Section.Members of Three Different Android Mobile Device App Piracy Groups ChargedRead the Press Release
Three federal indictments were unsealed today in the Northern District of Georgia charging six members of three different piracy groups – Appbucket, Applanet and SnappzMarket – for their roles in the illegal distribution of copies of copyrighted Android mobile device applications, or “apps,” announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Sally Quillian Yates of the Northern District of Georgia, and Special Agent in Charge J. Britt Johnson of the FBI’s Atlanta Field Office.
Two members of the SnappzMarket Group – Joshua Ryan Taylor, 24, of Kentwood, Michigan, and Scott Walton, 28, of Cleveland, Ohio – were arrested today. Taylor will appear before U.S. Magistrate Judge Ellen S. Carmody in Grand Rapids, Michigan, and Walton will appear before U.S. Magistrate Judge William H. Baughman, Jr. in Cleveland, Ohio.
“As a result of their criminal efforts to make money by ripping off the hard work and creativity of high-tech innovators, the defendants are charged with illegally distributing copyrighted apps,” said Assistant Attorney General Caldwell. “The Criminal Division is determined to protect the labor and ingenuity of copyright owners and to keep pace with criminals in the modern, technological marketplace.”
“Copyright infringement discourages smart people from doing innovative things,” said U.S. Attorney Yates. “This problem is especially acute when it comes to rapidly developing technologies, like apps for smart phones, and these defendants are now being held accountable for the intellectual property they stole.”
“Today’s federal indictments are the direct result of an extensive and thorough federal investigation into three groups of individuals aggressively engaged in and profiting from the theft of intellectual property,” said Special Agent in Charge Johnson. “While copyright infringement is the direct theft of the hard work of others in the form of research and development expended, it can also negatively impact incentives for further or future development of those ideas or applications. The FBI will continue to provide significant investigative resources toward such groups engaged in such wholesale pirating or copyright violations as seen here.”
An indictment returned on June 17, 2014, by a grand jury in the Northern District of Georgia charges Gary Edwin Sharp II, 26, of Uxbridge, Massachusetts, along with Taylor and Walton, with one count of conspiracy to commit criminal copyright infringement, and also charges Sharp with two counts of criminal copyright infringement. According to the indictment, Sharp, Taylor and Walton identified themselves as members of the SnappzMarket Group. From May 2011 through August 2012, they conspired with Kody Jon Peterson, 22, of Clermont, Florida, and other members of the SnappzMarket Group to reproduce and distribute over one million copies of copyrighted Android mobile device apps, with a total retail value of over $1.7 million, through the SnappzMarket alternative online market without permission from the copyright owners of the apps, who would otherwise sell copies of the apps on legitimate online markets for a fee. A separate information filed on Jan. 23, 2014 charged Peterson with one count of conspiracy to commit criminal copyright infringement, and he pleaded guilty on April 14, 2014.
An indictment returned on June 17, 2014, by a grand jury in the Northern District of Georgia charged James Blocker, 36, of Rowlett, Texas, with one count of conspiracy to commit criminal copyright infringement. According to the indictment, he and his fellow conspirators identified themselves as members of the Appbucket Group. From August 2010 to August 2012, Blocker conspired with Thomas Allen Dye, 21, of Jacksonville, Florida; Nicholas Anthony Narbone, 26, of Orlando, Florida; Thomas Pace, 38, of Oregon City, Oregon; and other members of the Appbucket Group to reproduce and distribute over one million copies of copyrighted Android mobile device apps, with a total retail value of over $700,000, through the Appbucket alternative online market without permission from the copyright owners of the apps, who would otherwise sell copies of the apps on legitimate online markets for a fee. A separate information filed on Jan. 24, 2014 charged Dye, Narbone, and Pace with one count of conspiracy to commit criminal copyright infringement. Dye, Narbone and Pace pleaded guilty to the charged conspiracy on March 10, 2014, March 24, 2014 and April 15, 2014, respectively.
An indictment returned on June 17, 2014, by a grand jury in the Northern District of Georgia charges Aaron Blake Buckley, 20, of Moss Point, Mississippi; David Lee, 29, of Chino Hills, California; and Sharp with one count of conspiracy to commit criminal copyright infringement, and also charges Lee with one count of aiding and abetting criminal copyright infringement and Buckley with one count of criminal copyright infringement. According to the indictment, Buckley, Lee, and Sharp identified themselves as members of the Applanet Group. From May 2010 through August 2012, they conspired with other members of the Applanet Group to reproduce and distribute over 4,000,000 copies of copyrighted Android mobile device apps, with a total retail value of over $17 million, through the Applanet alternative online market without permission from the copyright owners of the apps, who would otherwise sell copies of the apps on legitimate online markets for a fee.
The indictments charge leading members of the SnappzMarket Group, the Appbucket Group, and the Applanet Group with renting computer servers to host websites such as www.snappzmarket.com , www.appbucket.net , and www.applanet.net , respectively, to provide digital storage for the pirated copies of copyrighted Android apps that each group distributed to their members or subscribers. On Aug. 21, 2012, seizure orders were executed against these three website domain names for the illegal distribution of copies of copyrighted Android mobile device apps – the first time website domains involving mobile device app marketplaces have been seized.
Charges contained in an indictment are merely allegations, and the defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
This case was investigated by the FBI. Assistant Deputy Chief for Litigation John H. Zacharia of the Criminal Division’s Computer Crime and Intellectual Property Section (CCIPS) and Assistant U.S. Attorney Christopher Bly of the Northern District of Georgia are prosecuting the case, with the assistance of Assistant U.S. Attorney Brian M. Pearce of the Northern District of Georgia. The Office of International Affairs provided assistance in the matter. Significant assistance in the case has also been provided by the CCIPS Cybercrime Lab.Justice Department Seeks to Shut Down Los Angeles Area Tax Return PreparerRead the Press Release
The United States has asked a federal court in Los Angeles to bar Elton L. Barnes Jr. from preparing tax returns for others, the Justice Department announced today.
In 2002, Barnes pleaded guilty to aiding and assisting in the preparation of false tax returns, but he resumed preparing returns when he was released from prison, the government alleges. Since then, according to the complaint, Barnes has repeatedly prepared federal income tax returns, sometimes working under the names McNair Group, So Cal Financial Services and Anderson Investment Group, with fraudulent claims such as falsely inflated charitable contribution deductions and losses from imaginary home businesses. The complaint further alleges that Barnes has prepared returns that intentionally overstate the amount of federal income tax that has been withheld from his clients’ paychecks in order to claim a larger refund.
According to the complaint, the Internal Revenue Service (IRS) has chosen to audit more than 180 tax returns that Barnes prepared and that have been filed since his release from prison in 2009. The complaint also alleges that, although it has not completed its audits of all those returns, the IRS has already identified almost $2 million in false refund claims and understatements of taxes owed.
The complaint also alleges that Barnes met with a customer and obtained the customer’s personal identifying information, including his name, address and social security number. Allegedly, without the customer’s knowledge, Barnes then used the customer’s information to file a tax return that directed the IRS to deposit the claimed tax refund into Barnes’ bank account. The United States has identified more than 50 tax refunds that were deposited into bank accounts Barnes controls, although some deposits may have been made with the knowledge of Barnes’ clients. It is against federal law for a tax return preparer to deposit a client’s tax refund into his own bank account. According to the complaint, Barnes violated other laws that apply to return preparers by failing to sign returns he prepared or use his preparer tax identification number on them.
Return-preparer fraud is one of the IRS' Dirty Dozen Tax Scams for 2014. The IRS has some tips on their website for choosing a tax preparer. In the past decade, the Tax Division has obtained injunctions against hundreds of fraudulent tax preparers. Information about these cases is available on the Justice Department 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.
Related Materials:
United States v. Elton L. Barnes Jr.
United States Complaint for Permanent Injunctive ReliefJury Convicts Man of Impeding Boston Marathon Bombing InvestigationRead the Press Release
A federal jury in Boston has convicted a friend of alleged Boston Marathon bomber, Dzhokhar Tsarnaev, for impeding the bombing investigation.
Assistant Attorney General John P. Carlin of the Justice Department’s National Security Division, U.S. Attorney Carmen M. Ortiz of the District of Massachusetts and Special Agent in Charge Vincent B. Lisi of the FBI’s Boston Field Division, made the announcement today.
The jury found Azamat Tazhayakov, 20, guilty of conspiring to obstruct justice and obstructing justice with the intent to impede the Boston Marathon bombing investigation. U.S. District Judge Douglas P. Woodlock scheduled sentencing for October 16, 2014.
In August 2013, Tazhayakov was indicted for obstructing a terrorism investigation. Tazhayakov is a national of Kazakhstan who was temporarily living in the United States on a student visa while attending the University of Massachusetts Dartmouth, but at the time of his arrest his visa had been revoked.
The evidence at trial proved that on April 18, 2013, after the release of photographs of the two men suspected of carrying out the Marathon bombings (who were later identified as Tamerlan Tsarnaev and Dzhokhar Tsarnaev), Tazhayakov and others went to Tsarnaev’s dormitory room and found items that linked Tsarnaev to the bombing, including fireworks from which “gunpowder” appeared to have been removed and a jar of Vaseline that they believed could be used to make bombs. A forensic examiner testified that Vaseline can be used to make improvised explosive devices. A month before the bombing, Tsarnaev had told Tazhayakov that it would be good to die as shaheed (martyr) and that he knew how to build a bomb. Tsarnaev also identified specific ingredients one could use to make a bomb, including “gunpowder.”
After searching Tsarnaev’s dormitory room on the evening of April 18, 2013, Tazhayakov helped remove Tsarnaev’s laptop and a backpack containing fireworks, a jar of Vaseline, and a thumb drive. Later that night while Tazhayakov was monitoring the manhunt for the Tsarnaev brothers, he discussed getting rid of the backpack containing the fireworks and agreed to get rid of it. The backpack was then placed in a garbage bag and then thrown into a dumpster outside Tazhayakov’s New Bedford apartment. The FBI recovered this backpack a week later, after 25 agents spent two days searching a landfill in New Bedford.
The charging statute provides a sentence of no greater than 20 years in prison on the obstruction of justice count and five years on the conspiracy count, three years of supervised release, and a fine of $250,000 for each charge. Tazhayakov will also be deported at the conclusion of this prosecution. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
This investigation was conducted by the FBI's Boston Division and member agencies of the Boston Joint Terrorism Task Force (JTTF) which is comprised of more than 30 federal, state and local enforcement agencies. U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, Massachusetts State Police, University of Massachusetts Dartmouth Department of Public Safety, New Bedford Police Department, Dartmouth Police Department, U.S. Department of Transportation – Office of Inspector General, U.S. Treasury Inspector General for Tax Administration (TIGTA), Essex County Sheriff’s Office, and Internal Revenue Service, Criminal Investigations, provided assistance to this investigation.
T he case is being prosecuted by Assistant U.S. Attorneys B. Stephanie Siegmann and John A. Capin of Ortiz’s Anti-Terrorism and National Security Unit with assistance from the Counterterrorism Section of the Justice Department’s National Security Division.Former Senior Executive of Qualcomm Pleads Guilty to Insider Trading and Money LaunderingRead the Press Release
Jing Wang, 51, the former Executive Vice President and President of Global Business Operations for Qualcomm Inc., today pleaded guilty to insider trading in shares of Qualcomm and Atheros Communications Inc. Wang also pleaded guilty to laundering the proceeds of his insider trading using an offshore shell company.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney L aura E. Duffy of the Southern District of California made the announcement. Wang pleaded guilty today in federal court in San Diego before U.S. District Judge William Q. Hayes .
“Not satisfied with his lucrative executive position at Qualcomm, Jing Wang traded on insider information about the company’s acquisitions and earnings to gain an illegal advantage in the financial market,” said Assistant Attorney General Caldwell. “Wang then laundered close to $250,000 in insider trading profits, and created a cover-up story to hide his crimes. We will continue to prosecute those who believe they can make easy money by breaking the laws that ensure a level playing field in the financial marketplace.”
“Jing Wang blatantly and repeatedly abused the trust placed in him by Qualcomm and the company’s shareholders,” said United States Attorney Duffy. “To make matters worse, he then misused the financial system to conceal his insider trading profits and enlisted his brother and stock broker to obstruct several investigations. Wang’s obstructive acts, though ultimately unsuccessful, were serious affronts to the rule of law. We will continue to use our excellent partnerships with the Criminal Division, the FBI, IRS-CI and our other law enforcement partners to not only prosecute securities fraud, but also disrupt attempts like Wang’s to obscure criminal conduct from the eyes of government investigators.”
According to court documents, Wang committed insider trading on three separate occasions over a ten-month period in 2010 and 2011. In early 2010, Wang purchased approximately $277,739 of Qualcomm stock prior to the company’s unexpected announcement of a dividend increase and stock repurchase program. In December 2010, while in Hong Kong, Wang purchased Atheros stock hours after Qualcomm’s Board of Directors made a non-public offer to purchase Atheros. Just a few weeks later, in January 2011, Wang directed his stock broker, Gary Yin, to sell the Atheros stock in a brokerage account held in the name of an offshore entity, Unicorn Global Enterprises, and used the proceeds to purchase Qualcomm stock, one day before Qualcomm announced record earnings results. In total, Wang illegally gained approximately a quarter of a million dollars from these three illegal transactions.
Wang also pleaded guilty to money laundering resulting from transferring the illegal proceeds in the Unicorn account – over $525,000 – to another nominee brokerage account in the British Virgin Islands for Clearview Resources Ltd. Wang also admitted in his plea agreement to obstructing justice by conspiring with his brother, Bing Wang, and Yin to fabricate evidence and concoct a false cover story that Bing Wang conducted the illegal stock trades. Sentencing is scheduled for Nov. 17, 2014.
Wang was originally indicted in September 2013. Bing Wang, who is currently believed to reside in China, remains charged and is wanted on an international arrest warrant. Gary Yin pleaded guilty to conspiring with Jing Wang and Bing Wang to obstruct justice and launder money, and is currently scheduled to be sentenced on Sept. 15, 2014.
The department appreciates the substantial assistance it received from the Securities and Exchange Commission’s Los Angeles Regional Office.
This case was investigated by the FBI’s San Diego Field Office and the Internal Revenue Service-Criminal Investigation’s San Diego Field Division. The case is being prosecuted by Trial Attorney James P. McDonald of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Eric J. Beste of the Southern District of California.Former Officer Sentenced for Excessive Force and Obstruction ChargesRead the Press Release
Lindrith Tsoodle, 58, was sentenced today by U.S. District Judge Daniel Hovland to serve 15 months in prison for two incidents in which he used excessive force against an arrestee and for lying to a federal agent. Tsoodle was further ordered to serve two years of supervised release following completion of his prison term. On April 1, 2014, a federal jury convicted Tsoodle on these three charges.
Tsoodle was a police officer with the Three Affiliated Tribes Police Department in New Town, North Dakota, on the Fort Berthold Reservation. He was convicted of twisting the neck of a handcuffed suspect, throwing him to the ground and dropping a knee on him. He was also convicted of, on a separate occasion, excessively tightening the handcuffs of an arrestee, slamming him against the wall, using pepper spray on the arrestee and striking him with his hands and a baton. Both of these actions occurred while the suspects were restrained. Tsoodle was also convicted of telling various false statements to a U.S. Bureau of Indian Affairs Special Agent, who interviewed the defendant regarding one of the assaults.
“Our system of government requires police officers to abide by the laws they enforce and to protect the constitutional rights of all persons in their custody,” said Acting Assistant Attorney General Jocelyn Samuels of the Civil Rights Division. “This officer used his official position to commit civil rights abuses and then lied about his actions. The Department of Justice will continue to prosecute vigorously law enforcement officers who use their power to violate federal law.”
“With our colleagues at the Civil Rights Division, the U.S. Attorney’s Office is committed to protecting the civil rights of the citizens on the reservations in North Dakota,” said U.S. Attorney Timothy Purdon for the District of North Dakota. “This prosecution shows that our commitment to public safety on the reservations is matched by our commitment to a vigorous enforcement of civil rights of all people.”
This case was investigated by the Minot Resident Agency of the Minneapolis Division of the FBI and was prosecuted by Trial Attorneys Gerald Hogan and Nicholas Durham of the Civil Rights Division.
Alabama Hospital System and Physician Group Agree to Pay $24.5 Million to Settle Lawsuit Alleging False Claims for Illegal Medicare ReferralsRead the Press Release
Mobile, Alabama-based Infirmary Health System Inc. (IHS), two IHS-affiliated clinics and Diagnostic Physicians Group P.C. (DPG) have agreed to pay the United States $24.5 million to resolve a lawsuit alleging that they violated the False Claims Act by paying or receiving financial inducements in connection with claims to the Medicare program, the Justice Department announced today.
“Financial arrangements that compensate physicians for referrals encourage physicians to make decisions based on financial gain rather than patients’ needs,” said Assistant Attorney General for the Civil Division Stuart F. Delery. “The Department of Justice is committed to preventing illegal financial relationships that undermine the integrity of our public health programs.”
The government’s suit alleged that two IHS affiliated clinics -- IMC-Diagnostic and Medical Clinic, in Mobile, and IMC-Northside Clinic, in Saraland, Alabama -- had agreements with DPG to pay the group a percentage of Medicare payments for tests and procedures referred by DPG physicians, in violation of the Physician Self-Referral Law (commonly known as the Stark Law) and the Anti-Kickback Statute. Also named in the lawsuit was Infirmary Medical Clinics P.C. (IMC), an affiliate of IHS that directly owns and operates approximately 30 clinics in the Mobile area, including the two clinics involved in this lawsuit.
The Anti-Kickback Statute and the Stark Law are intended to ensure that a physician’s medical judgment is not compromised by improper financial incentives. The Anti-Kickback Statute prohibits offering, paying, soliciting or receiving remuneration to induce referrals of items or services covered by federal health care programs, including Medicare. The Stark Law forbids a hospital or clinic from billing Medicare for certain services referred by physicians who have a financial relationship with the entity.
According to the government’s complaint, in 1988, IMC purchased IMC-Diagnostic and Medical Clinic from DPG and agreed to pay DPG a share of the revenues the clinics collected, including Medicare revenues from diagnostic imaging and laboratory tests. After IMC acquired the IMC-Northside Clinic in 2008, the physicians practicing there joined DPG and entered into an agreement with the same key terms as the earlier agreement with IMC-Diagnostic and Medical Clinic. The government contended that these payments were illegal kickbacks and constituted a prohibited financial relationship under the Stark Law, and that in June 2010, an attorney for DPG warned employees of both IMC and DPG that the compensation being paid to the physicians likely violated the law. Nevertheless, the agreements allegedly were neither modified nor terminated for another 18 months.
The lawsuit was originally filed by Dr. Christian Heesch, a physician formerly employed by DPG, under the whistleblower provisions of the False Claims Act. Those provisions authorize private parties to sue on behalf of the United States and to receive a portion of any recovery. The act permits the United States to intervene and take over the lawsuit, as it did in this case with respect to some of Dr. Heesch’s allegations. Dr. Heesch will receive $4.41 million as his share of the settlement.
“Today’s settlement represents a single but significant step towards achieving integrity in the administration of public health programs in this region,” said U.S. Attorney Kenyen Brown for the Southern District of Alabama. “Physicians, physician groups and other medical entities operating illegally within public health programs will be held accountable. I also commend whistle blowers like Dr. Christian Heesch, who helped bring this particular case to light.”
As part of the settlement announced today, the settling defendants have also agreed to enter into a Corporate Integrity Agreement with the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), which obligates the defendants to undertake substantial internal compliance reforms and to submit its federal health care program claims to independent review for the next five years.
“Patients must know that medical advice is based on best practices, not on their provider’s bottom line,” said HHS-OIG Special Agent in Charge Derrick L. Jackson. “We are pleased these allegations are resolved and will continue to work with the U.S. Department of Justice to investigate and pursue illegal, wasteful business arrangements.”
This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $20.2 billion through False Claims Act cases, with more than $14 billion of that amount recovered in cases involving fraud against federal health care programs.
The investigation and litigation were conducted by the Justice Department’s Civil Division, the U.S. Attorney’s Office for the Southern District of Alabama, HHS-OIG and the FBI. The claims settled by this agreement are allegations only, and there has been no determination of liability.
The case is captioned U.S. ex rel. Heesch v. Diagnostic Physicians Group, P.C. et al., Civil Action No. 11-0364-KD-B (S.D. Ala.).
Statement by Attorney General Holder on Sentencing Commission Vote Approving Retroactivity of Sentence Reductions for Drug OffensesRead the Press Release
WASHINGTON—Attorney General Eric Holder today released the following statement regarding the U.S. Sentencing Commission vote approving retroactivity of sentence reductions for drug offenses:
“The department looks forward to implementing this plan to reduce sentences for certain incarcerated individuals. We have been in ongoing discussions with the Commission during its deliberations on this issue, and conveyed the department's support for this balanced approach. In the interest of fairness, it makes sense to apply changes to the sentencing guidelines retroactively, and the idea of a one-year implementation delay will adequately address public safety concerns by ensuring that judges have adequate time to consider whether an eligible individual is an appropriate candidate for a reduced sentence. At my direction, the Bureau of Prisons will begin notifying federal inmates of the opportunity to apply for a reduction in sentence immediately. This is a milestone in the effort to make more efficient use of our law enforcement resources and to ease the burden on our overcrowded prison system.”
Illinois Man Pleads Guilty to Obstruction of Justice and Filing False Multi-Billion Dollar Liens Against Two Federal Judges and Other Government EmployeesRead the Press Release
Tyree Davis Sr., 42, of Flossmoor, Illinois, pleaded guilty to two counts of obstruction of justice and two counts of filing false retaliatory liens against government officials, the Justice Department announced today.
Davis pleaded guilty earlier today before U.S. District Judge Michael M. Mihm of the Central District of Illinois. Davis faces a statutory maximum sentence of 10 years in prison for each of the obstruction of justice charges as well as a statutory maximum sentence of 10 years in prison for each of the filing false retaliatory liens charges at his sentencing on Oct. 15.
A federal grand jury in Chicago returned an eight count federal indictment on July 24, 2013, charging Davis with obstruction of justice and filing fraudulent multi-billion dollar liens against government employees. According to the court documents, Davis obstructed justice by sending correspondence threatening to arrest two federal judges, including the judge who presided over the 2010 criminal tax trial of LaShawn Littrice. Littrice, whom Davis refers to as his wife, was convicted by a jury in June 2010 and sentenced to serve 42 months in prison in December 2010. Davis also filed false liens, titled Notice of Maritime Liens, claiming that each judge owed Littrice $100 billion. Davis then notified others, including credit bureaus, that he had filed the multi-billion dollar liens. In addition, Davis filed false liens against the U.S. Attorney and Clerk of Court for the Northern District of Illinois, an Assistant U.S. Attorney and an Internal Revenue Service (IRS)-Criminal Investigation special agent. The liens were all publicly filed with the Cook County Recorder’s Office and claimed that each individual owed Littrice $100 billion. Each of the liens were re-recorded in order to add real property descriptions.
The case was investigated by the U.S. Treasury Inspector General for Tax Administration and the FBI, and prosecuted by Senior Litigation Counsel Jen E. Ihlo and Trial Attorney Matthew J. Kluge of the Tax Division.
Additional information about the Tax Division and its enforcement efforts may be found at the division website .
Aryan Brotherhood Members Plead Guilty to Federal Racketeering ChargesRead the Press Release
Two Aryan Brotherhood of Texas (ABT) gang members have pleaded guilty to racketeering charges related to their membership in the ABT’s criminal enterprise, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Kenneth Magidson of the Southern District of Texas.
Kenneth Michael Hancock of Dallas, Texas, pleaded guilty today before U.S. District Judge Sim Lake in the Southern District of Texas to one count of conspiracy to participate in racketeering activity. James Erik Sharron, aka “Flounder,” of Houston, Texas, pleaded guilty to the same charge on July 14, 2014.
According to court documents, Hancock, Sharron and other ABT gang members and associates agreed to commit multiple acts of murder, robbery, arson, kidnapping and narcotics trafficking on behalf of the ABT gang. Hancock, Sharron and numerous ABT gang members met on a regular basis at various locations throughout Texas to report on gang-related business, collect dues, commit disciplinary assaults against fellow gang members and discuss acts of violence against rival gang members, among other things.
By pleading guilty to racketeering charges, Hancock and Sharron admitted to being members of the ABT criminal enterprise.
According to the superseding indictment, the ABT was established in the early 1980s within the Texas prison system. The gang modeled itself after and adopted many of the precepts and writings of the Aryan Brotherhood, a California-based prison gang that was formed in the California prison system during the 1960s. According to the superseding indictment, the ABT was primarily concerned with the protection of white inmates and white supremacy/separatism. Over time, the ABT expanded its criminal enterprise to include illegal activities for profit.
Court documents allege that the ABT enforced its rules and promoted discipline among its members, prospects and associates through murder, attempted murder, conspiracy to murder, arson, assault, robbery and threats against those who violated the rules or posed a threat to the enterprise. Members, and oftentimes associates, were required to follow the orders of higher-ranking members, often referred to as “direct orders.”
According to the superseding indictment, in order to be considered for ABT membership, a person must be sponsored by another gang member. Once sponsored, a prospective member must serve an unspecified term, during which he is referred to as a prospect, while his conduct is observed by the members of the ABT.
Hancock and Sharron are both scheduled to be sentenced on Oct. 8, 2014. Each faces a maximum penalty of life in prison.
Hancock and Sharron are two of 36 defendants charged with conducting racketeering activity through the ABT criminal enterprise, among other charges. To date, 34 defendants have pleaded guilty.
This Organized Crime Drug Enforcement Task Force case is being investigated by a multi-agency task force consisting of the Bureau of Alcohol, Tobacco, Firearms and Explosives; the Drug Enforcement Administration; FBI; U.S. Marshals Service; Federal Bureau of Prisons; U.S. Immigration and Customs Enforcement Homeland Security Investigations; Texas Rangers; Texas Department of Public Safety; Montgomery County, Texas, Sheriff’s Office; Houston Police Department-Gang Division; Texas Department of Criminal Justice – Office of Inspector General; Harris County, Texas, Sheriff’s Office; Atascosa County, Texas, Sheriff’s Office; Orange County, Texas, Sheriff’s Office; Waller County, Texas, Sheriff’s Office; Alvin, Texas, Police Department; Carrollton, Texas, Police Department; Mesquite, Texas, Police Department; Montgomery County District Attorney’s Office; and the Atascosa County District Attorney’s Office.
The case is being prosecuted by the Criminal Division’s Organized Crime and Gang Section and the U.S. Attorney’s Office for the Southern District of Texas.Justice Department Reaches Agreement with Orange County Clerk of Courts in Florida to Ensure Equal Access to Court Records for Blind IndividualsRead the Press Release
The Justice Department announced today that it has reached a settlement with the Orange County Clerk of Courts in Florida to remedy violations of the Americans with Disabilities Act (ADA). The settlement resolves allegations that the Orange County Clerk of Courts failed to provide a blind attorney with electronic court documents in an accessible format readable by his screen reader technology, despite repeated requests. Indeed, a motion filed in one of his cases included over 20 exhibits, the majority of which were not provided in an accessible format for over four months.
Under the settlement agreement, the Orange County Clerk of Courts will provide individuals with disabilities with any document in the official court record in an accessible format upon request, and ensure that the Clerk of Courts’ website is accessible to individuals with disabilities, including blind individuals, in accordance with the Web Content Accessibility Guidelines (WCAG) 2.0 Level AA, available at http://www.w3.org/TR/WCAG20/. The Clerk of Courts will also pay $10,000 in damages to the complaining attorney and undergo training on the ADA and WCAG 2.0 AA accessibility requirements.
“The Civil Rights Division commends the Orange County Clerk of Courts for working with us to ensure equal access to the official court record for individuals with disabilities,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division. “Access to court documents is critical to ensuring that individuals with vision impairments and other disabilities have full and equal access to the courts—a right fundamental to our justice system.”
Under the ADA and its implementing regulations, Florida clerks of court are required to make their programs, services and activities accessible to qualified individuals with disabilities. The official court record is a program, service and activity of the clerk of courts. Those interested in finding out more about this settlement or the obligations of state and local government entities under the ADA may call the department’s toll-free ADA information line at 800-514-0301 or 800-514-0383 (TDD), or access the ADA website. ADA complaints may be filed by email
Justice Department Files Lawsuit Alleging Violations of Federal Law and Executive Order by Federal ContractorRead the Press Release
The Justice Department announced the filing of a lawsuit today against Entergy Corporation for violating Executive Order 11246, Section 503 of the Rehabilitation Act of 1973 and the Vietnam Era Veterans’ Readjustment Assistance Act of 1974. The lawsuit alleges that the defendant violated these laws and the executive order when it refused to comply with federal contractor requirements to submit proof of required affirmative action programs to the Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP). Because Entergy has refused to supply documentation and cooperate with auditing attempts, OFCCP has been unable to determine if Entergy is in compliance with its affirmative action obligations.
“Government contractors that choose to accept federal funds also agree to abide by laws and regulations aimed at preventing employment discrimination,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division. “When a government contractor, like Entergy, refuses to adhere to the obligations it accepted as a federal contractor, that refusal undermines the public trust that taxpayers expect in ensuring that public funding is used in a manner that complies with both federal law and agency regulations.”
“This issue has been litigated and re-litigated many times, and the courts have been clear: companies that profit from federal contracts must comply with our requests for proof that they are meeting their obligations,” said OFCCP Director Patricia A. Shiu. “Entergy already earns more than $1 billion in taxpayer-funded contracts to provide services to the government. We shouldn’t have to spend more of those dollars taking them to court because they refuse to abide by the law. So, I urge Entergy Chairman and CEO Leo Denault to respect our nation’s hard-won civil rights laws.”
Entergy, as a federal contractor, is prohibited from discriminating against employees and job applicants because of race, color, sex, religion, national origin, disability or protected veteran status. The company is also required to take affirmative action to employ qualified women, minorities, people with disabilities and protected veterans. To determine compliance with those affirmative action and non-discrimination requirements, government contractors, including Entergy, are required to develop and maintain written affirmative action programs, retain personnel and employment records, and provide OFCCP access to those documents during compliance reviews or investigations. The lawsuit seeks a permanent injunction requiring Entergy to comply with its obligations, including its obligation to produce documents requested by OFCCP within 30 days of the request.
The complaint, filed in the U.S. District Court for the Eastern District of Louisiana, alleges that since May 2012, Entergy has refused OFCCP’s repeated requests to turn over its written affirmative action programs and other records requested as part of the routine compliance review of 11 Entergy locations in Texas, Mississippi and Louisiana.
The Department of Labor referred this matter to the Department of Justice when Entergy refused to submit the documents requested by OFCCP even after receiving notices to show cause why enforcement proceedings should not be initiated.
The case is being handled by Senior Trial Attorney Valerie Meyer of the Department of Justice Civil Rights Division’s Employment Litigation Section.
More information about OFCCP is available on its website. Additional information about the Employment Litigation Section is available on the division website.