District Not Recorded
The source did not name an office we could identify. These records remain unassigned rather than guessed.
Illinois Man Sentenced for Smuggling Counterfeit Goods and Drugs into the U.S.<br />Read the Press Release
An Illinois man, who previously pleaded guilty to trafficking in counterfeit goods and introducing counterfeit drugs into interstate commerce in violation of the Food, Drug and Cosmetic Act, was sentenced today to serve 41 months in prison.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Kenneth Magidson for the Southern District of Texas and Special Agent in Charge Brian Moskowitz of Homeland Security Investigations (HSI) made the announcement.
Fayez Al-Jabri, 45, of Chicago, Illinois, was sentenced by U.S. District Court Judge Nancy F. Atlas in the Southern District of Texas. In addition to his prison term, Al-Jabri will serve three years of supervised release and ordered to pay $15,066 in restitution and forfeit $47,750.
According to court documents, Al-Jabri conspired to smuggle more than 26,000 counterfeit Viagra tablets from China into the United States for further distribution. As part of that conspiracy, between July 2011 and October 2012, Al-Jabri and his co-conspirator shipped thousands of counterfeit Viagra tablets from Chicago to an undercover agent in Houston, Texas. HSI submitted all of the tablets seized during the investigation to both the U.S. Food and Drug Administration (FDA) and Pfizer, Viagra’s manufacturer, for analysis. Both the FDA and Pfizer identified the tablets as counterfeit and misbranded Viagra.
Al-Jabri and Jamal Khattab, 49, of Katy, Texas, were indicted on Aug. 22, 2012. On March 21, 2014, Al-Jabri pleaded guilty to one count of conspiracy to traffic in counterfeit goods, to introduce misbranded prescription drugs into interstate commerce and to import such goods contrary to U.S. law; one count of trafficking in counterfeit goods; and one count of introducing counterfeit drugs into interstate commerce in violation of the Food, Drug and Cosmetic Act. Khattab pleaded guilty on Dec. 3, 2013, to the same charges, and his sentencing is scheduled for Aug. 14, 2014.
This matter was investigated by HSI, the FDA’s Office of Criminal Investigations, the Department of State - Diplomatic Security Service and police departments in Houston and Chicago. The case is being prosecuted by Assistant Deputy Chief for Litigation John H. Zacharia of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorneys Kebharu Smith and Jennifer Lowery of the Southern District of Texas.Government Files Suit Against Missouri Neurosurgeon and Medical Device Supplier for Violations of the False Claims Act and Anti-Kickback StatuteRead the Press Release
WASHINGTON – The Justice Department announced today that it has filed a complaint against Midwest Neurosurgeons L.L.C. and its owner, Dr. Sanjay Fonn, M.D., and DS Medical L.L.C. and its owner, Deborah Seeger, for allegedly violating the Medicare Anti-Kickback Statute and the False Claims Act by conspiring to solicit and receive commissions from medical device manufacturers related to the purchase of spinal implants and supplies used during spinal fusion surgeries performed by Dr. Fonn.
“The Department of Justice remains committed to protecting federal healthcare programs from unscrupulous providers who seek to take advantage of those programs,” said Assistant Attorney General for the Justice Department’s Civil Division Stuart F. Delery. “We are particularly concerned about schemes such as this one that not only waste taxpayer money but also pose a potential risk to patient safety.”
The Anti-Kickback Statute prohibits offering, paying, soliciting or receiving remuneration to induce referrals of items or services covered by Medicare, Medicaid and other federal healthcare programs. It is intended to ensure that a physician’s medical judgment is not compromised by improper financial incentives and is instead based upon the best interests of the patient.
The government’s complaint alleges that Dr. Fonn, 46, and his fiancée, Ms. Seeger, 47, both of Cape Girardeau, Missouri, incorporated D.S. Medical L.L.C. to serve as the distributor of medical devices and supplies to Dr. Fonn and his neurosurgery practice, Midwest Neurosurgeons L.L.C., in Missouri. Through D.S. Medical, Ms. Seeger demanded and was paid exorbitant commissions by medical device manufacturers for medical devices and supplies purchased by the hospital where Dr. Fonn performed spinal fusion surgeries. The hospital’s purchases were based on Dr. Fonn’s decision to use those devices and supplies during operations he performed. According to the complaint, once DS Medical started operating, Dr. Fonn altered the way he practiced medicine, generally using more spinal implants in each of his surgeries while performing more surgeries than he typically performed before or after DS Medical was operating. The commissions paid to D.S. Medical and Ms. Seeger by the manufacturers were allegedly used to purchase a house where Dr. Fonn and Seeger cohabited, a boat, an airplane and various home improvements, which they shared.
The allegations in the U.S. complaint were originally brought in a lawsuit filed under the qui tam provisions of the False Claims Act by several physicians, a spinal implant sales person, and a former employee of Midwest Neurosurgeons. Under the False Claims Act, a person that submits false or fraudulent claims to the government is liable for three times the government’s damages, plus civil penalties for each false claim. The act permits private citizens to sue on behalf of the government and share in any recovery. The United States is entitled to intervene in such a lawsuit, as it has done in this case.
The Commercial Litigation Branch of the Justice Department’s Civil Division, together with the U.S. Attorney’s Office for the Eastern District of Missouri, filed this case on behalf of the United States with the assistance of the Department of Health and Human Services Office of Inspector General and the FBI.
The qui tam case is captioned United States ex rel. Paul Cairns, Terry Cleaver, M.D., Kyle Colle, M.D., Scott Gibbs, M.D., Paul Tolentino, M.D., Kevin Vaught, M.D., and Daniel Henson v. D.S. Medical, L.L.C., Midwest Neurosurgeons, L.L.C., Sonjay Fonn, M.D., and Deborah Seeger, No. 1:12 CV 00004 SNLJ (E.D. Mo.). The complaint filed by the government contains allegations only; there has been no determination of liability.
Former Executive of French Power Company Subsidiary Pleads Guilty in Connection with Foreign Bribery SchemeRead the Press Release
A former senior executive of a subsidiary of Alstom SA, the French power and transportation company, 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, Acting U.S. Attorney Michael J. Gustafson of the District of Connecticut and Assistant Director in Charge Valerie Parlave of the FBI’s Washington Field Office made the announcement.
William Pomponi, a former vice president of regional sales at Alstom Power Inc., the Connecticut-based power subsidiary of Alstom, pleaded guilty today in federal court in New Haven, Connecticut, to conspiracy to violate the Foreign Corrupt Practices Act (FCPA) in connection with the awarding of the Tarahan power project in Indonesia. Pomponi was charged in a second superseding indictment on July 30, 2013. Pomponi is the fourth defendant to plead guilty to charges stemming from this investigation. Frederic Pierucci, the vice president of global boiler sales at Alstom, pleaded guilty on July 29, 2013, to one count of conspiracy to violate the FCPA and one count of violating the FCPA; and, David Rothschild, a former vice president of regional sales at Alstom Power Inc., pleaded guilty to conspiring to violate the FCPA on Nov. 2, 2012. Marubeni Corporation, Alstom’s consortium partner on the Tarahan project, pleaded guilty on March 19, 2014, to one count of conspiracy to violate the FCPA and seven counts of violating the FCPA, and was sentenced to pay a criminal fine of $88 million. FCPA and money laundering charges remain pending against Lawrence Hoskins, the former senior vice president for the Asia region for Alstom, and trial is scheduled for June 2, 2015.
“Three Alstom corporate executives and Marubeni, a major Japanese corporation, have now pleaded guilty to a seven-year scheme to pay bribes to Indonesian officials to secure a $118 million power contract,” said Assistant Attorney General Caldwell. “The Criminal Division of the Department of Justice will follow evidence of corruption wherever it leads, including into corporate boardrooms and corner offices. As this case demonstrates, we will hold both companies and their executives responsible for criminal conduct.”
According to the court filings, the defendants, together with others, paid bribes to officials in Indonesia, including a member of the Indonesian Parliament and high-ranking members of Perusahaan Listrik Negara (PLN), the state-owned and state-controlled electricity company in Indonesia, in exchange for assistance in securing a $118 million contract, known as the Tarahan project, to provide power-related services for the citizens of Indonesia from facilities in Tarahan. To conceal the bribes, the defendants retained two consultants purportedly to provide legitimate consulting services on behalf of Alstom and Marubeni in connection with the Tarahan project. In reality, the primary purpose for hiring the consultants was to use the consultants to pay bribes to Indonesian officials.
The first consultant retained by the defendants allegedly received hundreds of thousands of dollars in his Maryland bank account to be used to bribe the member of Parliament. The consultant then allegedly transferred the bribe money to a bank account in Indonesia for the benefit of the official. According to court documents, emails between Hoskins, Pomponi, Pierucci, Rothschild, and their co-conspirators discuss in detail the use of the first consultant to funnel bribes to the member of Parliament and the influence that the member of Parliament could exert over the Tarahan project.
However, in the fall of 2003, Hoskins, Pomponi, Pierucci and others determined that the first consultant was not effectively bribing key officials at PLN. One email between Alstom employees described PLN officials’ “concern that if we have won the job, whether their rewards will still be satisfactory or this agent only give them pocket money and disappear.” In another email, an employee at Alstom’s subsidiary in Indonesia sent an email to Hoskins asserting that the first consultant “has no grip on the PLN Tender team at all” and “is more or less similar to [a] cashier which I feel we pay too much.”
As a result, the co-conspirators retained a second consultant to bribe PLN officials, according to the court documents. The co-conspirators deviated from Alstom’s usual practice of paying consultants on a pro-rata basis in order to make a much larger up-front payment to the second consultant so that the consultant could “get the right influence.” An employee at Alstom’s subsidiary in Indonesia sent an email to Hoskins, Pomponi, Pierucci and others asking them to finalize the consultancy agreement with the front-loaded payments but stated that in the meantime the employee would give his word to a high-level official at PLN, according to the charges. The defendants and their co-conspirators were successful in securing the Tarahan project and subsequently made payments to the consultants for the purpose of bribing the Indonesian officials.
An indictment is merely an accusation, and defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.
The case is being investigated by FBI agents who are part of the Washington Field Office’s dedicated FCPA squad, with assistance from the Meriden, Connecticut, Resident Agency of the FBI. Significant assistance was provided by the Criminal Division’s Office of International Affairs, and the department has also received substantial assistance from its law enforcement counterparts in Indonesia, Switzerland and Singapore and greatly appreciates their cooperation. The case is being prosecuted by Assistant Chief Daniel S. Kahn of the Criminal Division’s Fraud Section and Assistant U.S. Attorney David E. Novick of the District of Connecticut.
Additional information about the Justice Department’s FCPA enforcement efforts can be found at www.justice.gov/criminal/fraud/fcpa.Florida Man Sentenced to 15 Years in Prison on Child Pornography Charges<br />Read the Press Release
Robert Eugene Revay, 79, of Oakland Park, Florida, was sentenced to serve 15 years in prison for conspiring to produce child pornography and for possession of child pornography.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer for the Southern District of Florida and Inspector in Charge Ronald J. Verrochio of the U.S. Postal Inspection Service (USPIS) made the announcement. The sentence was imposed by U.S. District Judge Robert N. Scola of the Southern District of Florida. In addition to Revay’s prison term, he was sentenced to a life term of supervised release.
According to court documents and statements made at the plea hearing, in 2011, law enforcement initiated an investigation into an online chat group whose members traveled to engage in sex with prepubescent boys, and produced and distributed child pornography. Through the investigation, law enforcement obtained computer hard drives that belonged to two of the group’s members, Mark J. Newton and Peter Truong, who were sentenced to serve 40 years in prison and 30 years in prison, respectively, for their crimes. Forensic examination of the hard drives yielded images and videos of boys being sexually abused.
Revay was a member of that online chat group. In 1997, Revay and Truong were living together in an apartment in Germantown, Maryland, where they enticed a then-12-year-old child to come to their apartment. They sexually abused the victim on numerous occasions and took pictures and videos of the abuse.
On March 19, 2013, as part of the investigation, law enforcement officers executed a federal search warrant at Revay’s residence in Oakland Park, Florida. On Revay’s computer, law enforcement discovered child pornography in an encrypted container. Revay admitted that he had downloaded and possessed the child pornography. Revay also admitted that on previous occasions, he downloaded child pornography via the Internet.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc . For more information about Internet safety education, please visit www.justice.gov/psc and click on the “resources” tab on the left of the page.
The case was investigated by USPIS, and prosecuted by LisaMarie Freitas and Michael Grant of the Criminal Division’s Child Exploitation and Obscenity Section and Assistant U.S. Attorney Olivia Choe of the Southern District of Florida.Attorney General Holder Announces Plans to Send Seven Additional ATF Agents to ChicagoRead the Press Release
WASHINGTON – Following his recent visit to Chicago where he participated in a roundtable discussion with Mayor Emanuel on recent reductions in youth violence, Attorney General Eric Holder today announced plans to send seven additional Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), agents to the field division office in Chicago.
The new ATF agents will coordinate efforts with U.S. Attorney Zachary T. Fardon, as well as federal, state and local law enforcement and community partnerships to advance proven strategies to reduce illegal gun trafficking and gun crime. There are currently 45 ATF agents assigned to Chicago.
"The Department of Justice will continue to do everything in its power to help the city of Chicago combat gun violence,” said Attorney General Eric Holder. "These new agents are a sign of the federal government's ongoing commitment to helping local leaders ensure Chicago's streets are safe.”
The deployment of new ATF agents represents the latest step in strengthening the partnerships with the Chicago Police Department and other local law enforcement agencies. In early June, ATF opened the Chicago Crime Gun Intelligence Center. The Center combines the gun enforcement efforts of the Chicago Police Department, Illinois State Police and ATF to provide additional leads that otherwise might go unnoticed and further addresses the illegal sales and possession of firearms in the State of Illinois.In addition, U.S. Attorney Zachary T. Fardon announced a restructuring of the Criminal Division in his office and in doing so named a team of prosecutors who will work specifically to reduce violent crime in the city. The FBI currently has over 100 agents in Chicago assigned to curb gang and violent crimes. During the summer months, the city temporarily assigned an additional 20 agents to supplement crime reduction efforts. Under the 12 current grants administered by our Office of Juvenile Justice and Delinquency Prevention alone, the City of Chicago and Cook County has access to more than $6.6 million to further these efforts to address youth violence.
Gun crime is the primary driver of homicide in Chicago, and sixty percent of the guns recovered in violent crimes in Chicago were originally sold in other states and trafficked into the city. Given the interstate nature of these crimes, it is critical that federal and local law enforcement work together to identify traffickers and enforce federal gun laws. ATF will continue to concentrate its criminal enforcement on firearms trafficking throughout the region while curbing the supply of illegal guns that end up in the hands of gang members and other violent criminals.
“ATF’s commitment to targeting traffickers and trigger pullers in Chicago is bolstered by these additional resources,” said ATF Director B. Todd Jones. “These resources, combined with ATF’s Crime Gun Intelligence Center, will strengthen and build on our outstanding partnership with the Chicago Police Department and other local, state and regional law enforcement to bring safety and justice back to the community."
“We have enjoyed an ever-improving and increasingly productive relationship with our federal partners,” said Chicago Police Superintendent Garry McCarthy. “We look forward to continuing that relationship and welcoming additional personnel in our ongoing efforts to ensure everyone in Chicago enjoys the same sense of safety.”
The Justice Department will continue to build on this work in the months ahead through initiatives like Project Safe Neighborhoods; the National Forum on Youth Violence Prevention; and innovative community oriented policing tools in the neighborhoods across Chicago.Washington, D.C., Mother and Son Charged with Conspiring to Defraud Internal Revenue ServiceRead the Press Release
Sherri Davis and her son, Andre Davis, were charged in a superseding indictment with conspiring to defraud the Internal Revenue Service (IRS) and with aiding and assisting in the preparation of false individual income tax returns, the Justice Department and IRS announced today. Sherri Davis was also charged with filing her own false individual income tax returns for tax years 2007 to 2009.
According to the superseding indictment, Sherri Davis was the previous owner and operator of 2FT Fast Facts Tax Service, a tax return preparation business located in Washington, D.C. Andre Davis is the current owner and operator of Davis Financial Services (DFS), a tax return preparation business also located in Washington, D.C. From January 2006 through April 15, 2013, Sherri Davis and Andre Davis conspired with others to defraud the IRS by preparing and filing false income tax returns that contained fraudulent deductions, expenses, losses and credits to which 2FT and DFS clients were not entitled, thereby generating fraudulent income tax refunds.
The superseding indictment alleges that Sherri Davis and Andre Davis falsified tax documents for 2FT and DFS clients in order to reduce their taxable income and to get a larger refund than what the client was entitled to receive. The superseding indictment also alleges that from 2007 through 2009, Sherri Davis filed her own false individual income tax returns which underreported 2FT’s gross receipts and falsely claimed business losses for 2FT.
An indictment merely alleges that crimes have been committed and the defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted of the conspiracy charge, the defendants face a statutory maximum sentence of five years in prison and a $250,000 fine. The charges of filing a false income tax return and aiding or assisting in filing a false return carry a statutory maximum sentence of three years in prison and a fine of $250,000 for each count.
The case is being prosecuted by Trial Attorneys Jessica Moran, Tiwana Fleming and Mark McDonald of the Justice Department’s Tax Division and was investigated by special agents of IRS-Criminal Investigation.
Related Materials:
United States v. Sherri Davis, et al.
Superseding IndictmentU.S. Settlement with Minnesota Coal-Fired Utility to Reduce EmissionsRead the Press Release
In a settlement with the United States, Minnesota Power (MP), an ALLETE company based in Duluth, Minnesota has agreed to install pollution control technology and meet stringent emission rates to reduce harmful air pollution from the company’s three coal-fired power plants located in Cohasset, Hoyt Lakes and Schroeder, Minnesota, the Department of Justice and the U.S. Environmental Protection Agency (EPA) announced today. The settlement will resolve claims that the company violated the New Source Review provisions of the Clean Air Act by unlawfully constructing major modifications at its plants without obtaining required permits and installing and operating the best available air pollution control technology, as the Act requires.
EPA expects that the actions required by the settlement will reduce harmful emissions by over 13,350 tons per year, which includes approximately 8,500 tons per year of sulfur dioxide. The company estimates that it will spend over $500 million to implement the required measures.
The settlement also requires that the company pay a civil penalty of $1.4 million to resolve Clean Air Act violations and spend at least $4.2 million on environmental projects to benefit local communities. The state of Minnesota is co-plaintiff to the settlement and will receive $200,000 of the penalty.
“Today’s settlement will require system-wide controls to reduce harmful air pollution and will benefit Minnesota residents today and for years to come,” said Sam Hirsch, Acting Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division. “This innovative agreement will also fund projects that contribute to renewable energy production and restore valuable wetland habitat.”
“Reducing harmful emissions from large sources of air pollution is a national priority for EPA,” said Cynthia Giles, assistant administrator for EPA’s Office of Enforcement and Compliance Assurance. “By meeting some of the lowest emission rates in the country, Minnesota Power will continue to provide energy to communities across northeastern Minnesota, while at the same time, reducing sulfur dioxide and nitrogen oxide in the air, which can pose serious health risks.”
The settlement requires that the company install pollution control technology and implement other measures to reduce sulfur dioxide ( SO2 ), nitrogen oxide (NOx ), and particulate matter emissions from its three coal-fired power plants, which include nine operating units, as well as a biomass-and-coal-fired cogeneration plant which provides power and steam to an adjacent paper mill. Among other requirements, the company must install control technologies and meet emission rates that will be among some of the lowest in the country for SO2 at its largest unit and for both SO2 and NOx at the second largest unit.
In addition, the company must retire, refuel, repower, or reroute emissions at five other units, and must meet emission rates and install additional control technologies at remaining units. The company also must comply with declining system-wide annual tonnage limits for both SO2 and NOx.
SO2 and NOx, two predominant pollutants emitted from power plants, have numerous adverse effects on human health and are significant contributors to acid rain, smog, and haze. These pollutants are converted in the air to particulate matter that can cause severe respiratory and cardiovascular impacts, and premature death.
The settlement also requires that the company spend $4.2 million on projects that will benefit the environment and local communities, including $2 million to build a large-scale solar installation system to benefit a local tribe known as the Fond du Lac Band. In addition, the company will provide between $500,000 and $1 million to replace, retrofit, or upgrade wood burning appliances to reduce pollution, and $200,000 to the National Park Service to restore wetlands at Voyageurs National Park. For the remaining money, the company can select from the following four project types: land donation and restoration, electric vehicle charging stations, clean diesel projects, or installation of renewable energy.
This settlement is part of EPA’s national enforcement initiative to control harmful emissions from large sources of pollution, which includes coal-fired power plants, under the Clean Air Act’s New Source Review requirements. The total combined SO2 and NOx emission reductions secured from all these settlements will exceed two million tons each year once all the required pollution controls have been installed and implemented.
Minnesota Power provides electric service to approximately 143,000 people and 16 municipalities within a 26,000-square-mile area in northeastern Minnesota.
The settlement was lodged with the U.S. District Court for Minnesota and is subject to a 30-day public comment period and final court approval. It will be available for viewing at http://www.justice.gov/enrd/Consent_Decrees.html .
More information about EPA’s enforcement initiative: http://www.epa.gov/compliance/data/planning/initiatives/2011airpollution.htmlNorth Carolina Recycling Business and Owner Sentenced to Unlawful Handling of PCB-Contaminated Oil, Tax Violations, and False StatementsRead the Press Release
Benjamin Franklin Pass, 61, and P&W Waste Oil Services Inc. (P&W), of Leland, North Carolina were sentenced today in federal court in Raleigh, North Carolina. Pass was sentenced to 42 months in prison and ordered to pay restitution in the amount of $21,373,143.38 for clean-up costs associated with the environmental contamination at his business and an additional $538,857 to the Internal Revenue Service (IRS) for federal income taxes he failed to pay between 2002 and 2011.
Pass and the company previously pleaded guilty to crimes related to the unlawful handling and dilution of used oil contaminated with polychlorinated biphenyls (PCB). Pass also pleaded guilty to failure to pay taxes and P&W pleaded guilty to material false statements.
The court also ordered P&W to pay restitution in the amount of $21,373,143.38 for losses incurred by Colonial Oil and International Paper as a result of the defendants’ mishandling of used oil contaminated with PCBs that led to widespread contamination and millions of dollars in clean-up costs. P&W was also ordered to serve a five-year term of probation and to take remedial action to address the environmental contamination at its facility and other leased property in eastern North Carolina, including but not limited to, the proper treatment and disposal of PCB-contaminated waste oil.
“Today’s sentence is just punishment for the defendant’s actions, which placed the health of North Carolina’s residents and their natural resources at risk,” said Sam Hirsch, Acting Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division. “ Environmental violations such as these are serious crimes, and the Justice Department and the U.S. Attorney’s Offices will continue to vigorously prosecute those individuals and companies who ignore the laws Congress enacted to protect people and our environment from toxic substances like PCBs.”
“This disregard of environmental protections resulted in significant contamination,” said U.S. Attorney Thomas G. Walker. “The defendant’s conduct placed an economic burden on the United States and an unreasonable risk to the health and safety of the citizens of North Carolina.”
According to information in the public record, Pass owned and operated P&W’s facility in Leland, North Carolina. The facility is located approximately 500 feet to the east of the Cape Fear River and a federally recognized wetland.
As part of its business operations, P&W collected, transported, processed, and marketed used oil that it received from small and large companies, such as automotive service stations, transformer repair companies and marinas. P&W also conducted tank cleaning and waste removal.
P&W, however, was not authorized to transport, store, or handle used oil containing more than two parts per million (ppm) of PCBs. PCBs are man-made organic chemicals that were manufactured domestically from 1929 to 1979 and were used in hundreds of industrial and commercial applications, such as thermal insulation in electrical transformers and capacitors. PCBs were determined to cause cancer and have been demonstrated to cause a variety of adverse health effects on the immune system, reproductive system, nervous system, and endocrine system. Accordingly, Congress banned the production of PCBs and mandated that no person may distribute in commerce, or use any PCBs other than in a totally enclosed manner, and directed the U.S. Environmental Protection Agency (EPA) to promulgate rules phasing out the manufacture of PCBs and regulating their disposal. PCBs still exist in products produced before the 1979 ban and if mishandled and released into the environment, can remain for long periods of time in the air, water, and soil.
In July 2009, an employee of P&W transported used-oil contaminated with more than 500 ppm of PCBs from a business in Wallace, South Carolina to its Leland facility where the contaminated used oil was blended and diluted with other used oil. Testing results obtained by Pass in October 2009 revealed PCB contamination in excess of 4,925 ppm.
The contaminated product was eventually resold to Colonial Oil and International Paper. Colonial Oil discovered the contamination as part of its standard sampling and testing protocol. As a result, over three million gallons of contaminated used oil had to be transported and incinerated at a certified disposal site for PCBs. The costs to Colonial Oil for the proper disposal of the contaminated used oil exceeded $17 million in addition to significant disruption of its business operations.
The investigation further revealed that at the direction of Pass, employees of P&W continued to transport and dilute the PCB-contaminated used oil at the facility after the contamination was discovered. The EPA intervened and had the Leland facility designated a Superfund site. Superfund is the name given to the federal environmental program established to clean up the nation’s uncontrolled hazardous waste sites. Costs for the clean-up of the contaminated tanks at the facility exceeded $3.4 million.
Law enforcement also learned that in 2009 and again in 2010, Pass and P&W falsely certified that its employees had taken requisite training on the handling of hazardous wastes and that, between 2002 through 2011, Pass failed to pay his federal income taxes despite having the ability to pay.
“Today’s sentencing is a direct result of the strong collaboration between EPA-CID and its federal law enforcement partners,” said Maureen O’Mara, Special Agent in Charge of EPA’s criminal enforcement program in North Carolina. “In order to safeguard the environment and public health, it is essential that we hold companies and their corporate officers responsible for failing to accurately report violations to avoid penalty. We will continue to pursue those who fraudulently report information critical to human health and the environment to preserve the integrity of programs designed to protect the public.”
“Mr. Pass’s disregard to uphold his legal obligations in business and paying income taxes have come with a price,” said Chief Richard Weber of the IRS Criminal Investigation. “Today’s sentencing reinforces law enforcements collaborative efforts to enforce the law and ensure public trust.” Thomas J. Holloman, Special Agent in Charge IRS Criminal Investigation added, “A fraud of this magnitude requires a coordinated effort among law enforcement agencies to stop those involved from profiting from their wrongdoing. We are the stewards of our environment and anyone who knowingly pollutes it should be held accountable.”
Acting Assistant Attorney General Hirsch and U.S. Attorney Walker praised the continued joint efforts of the EPA’s Criminal Investigation Division and the IRS’s Office of Criminal Investigations and the U.S. Coast Guard’s Criminal Investigative Services for their diligent work in the investigation of this matter. Assistant U.S. Attorney Banumathi Rangarajan of the Eastern District of North Carolina and Trial Attorney Shennie Patel of the Justice Department’s Environmental Crimes Section of the Environment and Natural Resources Division are the prosecutors in charge of the case. Assistant U.S. Attorney Norman Acker and the Financial Litigation Unit provided significant support to the prosecution team.Long Island Fish Dealer Pleads Guilty to Fraud, Falsifying Federal Records, and Lacey Act ViolationsRead the Press Release
Jones Inlet Seafood Co., Inc., a federally-licensed fish dealer located in Point Lookout, New York, its company president, Michael G. Mihale, and the company vice-president, Bruce Larson, Jr. pleaded guilty today in federal court in Central Islip, New York., to federal felonies stemming from their role in systematically underreporting fluke (summer flounder) that was being harvested as part of the federal Research Set-Aside (RSA) Program, the Justice Department’s Environment and Natural Resources Division announced.
Michael G. Mihale and Bruce Larson, Jr. pleaded guilty to one count of wire fraud and one count of falsification of federal records. The two were involved in a scheme to direct unwitting subordinates to falsify and submit at least 65 fisheries dealer reports from June 2009 to December 2011, defrauding the United States of 56,000 pounds of overharvested and underreported fluke valued at $116,000. Jones Inlet Seafood Co., Inc. pleaded guilty to the falsification of federal records charge as well as one count of Lacey Act False Labeling for the knowing use of false documents in connection with approximately $100,000 worth of fluke that was shipped to customers in Connecticut and New Jersey.
As part of the plea deal, the three defendants agreed to be subject to between $222,000 and $276,000 in combined fines and restitution. The defendants also agreed to make a $30,000 community service payment to the Cornell Cooperative Extension of Suffolk County in order to pay for the enhancement of fluke habitat through the C.C.E.’s Marine Meadows Program. The jointly proposed sentence includes a ban on Mihale and Larson, Jr. from holding a federal dealer license, accessing the National Oceanic and Atmospheric Administration’s (NOAA) SAFIS computer system, participating in the RSA program, or being in a position to direct others to complete dealer reports . Jones Inlet also agreed to increased recordkeeping and auditing requirements. The court will hear sentencing recommendations regarding non-agreed terms at a hearing set for Jan. 12, 2015.
Jones Inlet Seafood is “Fish Dealer Y” as that entity is identified in the related case of U.S. v. Anthony Joseph. As a federal fish dealer, Jones Inlet Seafood had a NOAA permit to purchase fish directly from commercial fishing vessels without having to go through an intermediary. In June 2009, Mihale and Larson, Jr. learned that Anthony Joseph, captain of the F/V Stirs One, was consistently overharvesting fluke through Joseph’s abuse of the RSA Program. By June 2009, on behalf of Jones Inlet Seafood, Mihale and Larson, Jr. were making regular purchases of illegal fluke from Joseph at the Point Lookout, New York waterfront.
In order to cover his illegal fishing, Joseph would mail falsified fishing logs, known as FVTRs, to NOAA, but falsified FVTRs were just one side of the equation. This is because fish dealers are required to report their purchases to NOAA on an electronic form known as a dealer report. The dealer reports include information such as date of landing, port of landing, catch vessel, corresponding FVTR numbers, commercial grade, species, price and weight. NOAA utilizes the data in the dealer reports to set quotas and implement other management measures designed to ensure a sustainable fisheries. The dealer reports also serve as a check on the information that is submitted in FVTRs. In other words, in order to effectuate his scheme, Anthony Joseph needed to ensure that corresponding false dealer reports were being submitted that contained the same false information as was contained on the falsified FVTRs. A mismatch would have indicated a serious error or fraud, and would have been a red flag for fisheries managers. Accordingly, during June 2009 to December 2011, Mihale and Larson, Jr. schemed with Anthony Joseph to file at least 65 false dealer reports with NOAA, representing a loss of 56,000 pounds of fluke valued at $116,000. The vast majority of these three defendants’ illegal activity took place in 2011.
The case was investigated by agents of NOAA’s National Marine Fisheries Service, with assistance from the New York State Department of Environmental Conservation Police. The case is being prosecuted by Christopher L. Hale of the Justice Department’s Environmental Crimes Section, Environment and Natural Resources Division.Justice Department Sues to Stop Chicago Man from Promoting Alleged Tax Scheme and Preparing Tax ReturnsRead the Press Release
The United States filed a complaint today to bar Victor M. Crown, individually and through his businesses Crown and Franklin Accounting and Refunds, Crown-Franklin Accounting Inc., Accurate Accounting PV, and Lourdes Theodossis Estate, from promoting two alleged tax fraud schemes and from preparing federal tax returns for others, the Justice Department announced.
The complaint alleges that Crown’s tax schemes and the tax returns and other tax documents he prepares are based, at least in part, on his customers’ employment with the city of Chicago or on his customers’ discrimination awards in the class-action case Shakman, et al., v. Democratic Organization of Cook County, et al. (Shakman). Shakman is a discrimination class-action lawsuit against the city of Chicago that alleged political patronage in the hiring and promotion of public officials. As part of the settlement, the city of Chicago agreed to set up a $12 million fund to compensate class members for injuries that allegedly arose from violations of court orders.
According to the complaint, Crown prepares federal income tax returns and other documents that claim false amounts of income tax withheld from his customers’ earnings. The government contends that Crown asserts that his customers can claim credit for false amounts of tax withheld based on his contention that the city of Chicago incorrectly calculated the income taxes it withheld from its employees’ wages. According to the complaint, Crown’s claims lack merit because an employee is not entitled to claim an income tax withholding credit for more than the amount of income taxes actually withheld from their wages.
The complaint also alleges that Crown prepares customers’ income tax returns and other documents that claim bogus net operating losses. According to the complaint, Crown asserts that his customers are entitled to claim these bogus losses because the customers sought, but did not receive, a certain award amount for their Shakman class-action claim. For example, Crown allegedly prepared a return for a Shakman claimant who sought a $100,000 award, but only received $12,500. According to the complaint, Crown falsely claimed the customer was entitled to an $87,500 net operating loss on the customer’s amended tax returns. The complaint alleges that Crown’s scheme lacks merit because nothing in the Internal Revenue Code permits a taxpayer to deduct the amount of a denied discrimination claim as a net operating loss. According to the complaint, Crown’s frivolous claims have resulted in fraudulently understated tax liabilities on his customers’ federal income tax returns.
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. Victor M. Crown, et al.
Complaint for Permanent Injunction and Other ReliefJustice Department Sues to Shut Down Texas Tax Return PreparersRead the Press Release
The United States has asked a federal court in Waco, Texas, to permanently bar several tax preparers individually and through the business Accounting System Services, doing business as A Kind Bookkeeping and Tax Service, from preparing federal tax returns for others, the Justice Department announced today.
The individually named defendants are Patricia Foley aka Sissy Foley, Amanda Smith, April Leann Morgan aka April Leann Ercanbrack, Cassandra Egbert and Joshua Stifle.
The complaint alleges that the defendants prepared income tax returns for their customers that contain false, improper or inflated business expense deductions on Schedule F (Profit or Loss from Farming) of their returns. As a result, the government contends the defendants’ customers have repeatedly reported and paid less tax than they actually owe. The complaint alleges that the tax harm caused by these understatements could be as much as $500,000.
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. Patricia Foley, etc., et al.
Complaint for Injunctive ReliefIllinois Federal Court Enjoins Certified Public Accountant from Specific ConductRead the Press Release
A federal court in East St. Louis, Illinois, permanently barred Ronald Manis, a certified public accountant, of Carbondale, Illinois, from engaging in certain conduct, the Justice Department announced today. This includes preparing or filing federal tax returns by improperly claiming deductions for commuting to and from work, unsubstantiated meals and entertainment expenses, or other non-deductible personal expenses.
The injunction order also bars Manis from misrepresenting his ability to practice before the Internal Revenue Service (IRS) and requires Manis to hire, and pay for, a third party monitor to review a sample of tax returns prepared by Manis each year for five years. Manis agreed to the injunction without admitting the allegations in the complaint.
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. Ronald E. Manis
Stipulated Final Judgment of Permanent Injunction Against Ronald ManisFour Mississippi Men and Women Indicted for Racially Motivated Hate Crimes Spree in Jackson, MississippiRead the Press Release
Acting Assistant Attorney General Jocelyn Samuels for the Justice Department’s Civil Rights Division and U.S. Attorney Gregory K. Davis for the Southern District of Mississippi announced today that a federal grand jury has indicted John Louis Blalack, 20, of Brandon, Mississippi, Sarah Adelia Graves, 21, of Crystal Springs, Mississippi, Robert Henry Rice, 23, of Brandon, and Shelbie Brooke Richards, 20, of Pearl, Mississippi, for their alleged roles in a conspiracy to commit federal hate crimes against African-American people in Jackson, Mississippi.
Blalack, Graves and Richards are additionally charged with a racially motivated hate crime resulting in the death of a victim run over by a truck. Blalack and Rice are charged with two additional racially motivated hate crimes involving alleged assaults, and with carrying a firearm in relation to one of those assaults. Graves and Richards are additionally charged with soliciting others to commit hate crimes against African-Americans, and Graves is charged with making false statements to the FBI. Defendants Deryl Paul Dedmon, 20; John Aaron Rice, 19; Dylan Wade Butler, 21; William Kirk Montgomery, 23; Jonathan Kyle Gaskamp, 20; and Joseph Dominick, 22, all from Brandon, have previously entered guilty pleas in connection with their roles in these offenses.
The indictment alleges that, beginning in the spring of 2011, the defendants and others conspired with one another to harass and assault African-American people in and around the Jackson area. According to the indictment, on numerous occasions, the co-conspirators used dangerous weapons, including beer bottles, sling shots and motor vehicles, to cause, and attempt to cause, bodily injury to African-American people. The co-conspirators are alleged to have specifically targeted African-American people they believed to be homeless or under the influence of alcohol because they believed that such individuals would be less likely to report an assault. The co-conspirators would often boast about these racially motivated assaults. The indictment details several such assaults, including the fatal assault on a victim who was intentionally run over.
The defendants face a statutory maximum sentence of life in prison.
The case is the result of a cooperative effort between the U.S. Attorney’s Office for the Southern District of Mississippi, the Civil Rights Division and the Hinds County District Attorney’s office. This case was investigated by the Jackson Division of the FBI and the Jackson Police Department. It is being prosecuted by Trial Attorney Sheldon L. Beer and Deputy Chief Paige M. Fitzgerald of the Civil Rights Division, and Assistant U.S. Attorney Glenda R. Haynes of the U.S. Attorney’s Office for the Southern District of Mississippi.
The charges set forth in an indictment are merely accusations and the defendants are presumed innocent until proven guilty.
Five Defendants Sentenced in the District Court of GuamRead the Press Release
ALICIA A.G. LIMTIACO, United States Attorney for the Districts of Guam and the Northern Mariana Islands, announced that five more defendants who were witnesses in the U.S. v. Mateo B. Sardoma, Jr. aka “Mat”, Rudy P.H. Sablan, Maria C. Edrosa aka “Cristina”, et al. trial were sentenced by Chief Judge Frances Tydingco-Gatewood, as follows:
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Defendant JAMES PANGELINAN, age 44, was sentenced on July 6, 2014, to time served followed by four years of supervised release. Defendant PANGELINAN pleaded guilty to Conspiracy to Distribute Methamphetamine, in violation of 21 U.S.C. §§ 841(a)(1) and 846. Defendant PANGELINAN assisted co-defendant Ana Toves in selling methamphetamine for Defendants Mateo Sardoma, Jr. and Rudy Sablan.
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Defendant SYLVIA MASHBURN DUENAS, age 30, was sentenced on July 8, 2014, to
37 months incarceration followed by five years of supervised release. Defendant
DUENAS pleaded guilty to Conspiracy to Distribute Methamphetamine, in violation of
21 U.S.C. §§ 841(a)(1) and 846. Defendant DUENAS assisted Defendant Mateo
Sardoma, Jr. in obtaining the methamphetamine. -
Defendant CHRISTOPHER A.D. MESA, age 33, was sentenced on July 9, 2014, to 51 months incarceration followed by five years of supervised release. Defendant MESA pleaded guilty to Conspiracy to Distribute Methamphetamine, in violation of 21 U.S.C.
§§ 841(a)(1) and 846 and aiding and abetting the brandishing of a firearm during a drug crime in aid of Defendant Mateo B. Sardoma, Jr. -
Defendant ANTHONY VILLANUEVA, age 48, was sentenced on July 10, 2014, to 46 months incarceration followed by five years of supervised release. Defendant VILLANUEVA pleaded guilty to Conspiracy to Distribute Methamphetamine, in violation of 21 U.S.C. §§ 841(a)(1) and 846. Defendant VILLANUEVA assisted defendant Mateo Sardoma, Jr. by supplying a post office box for Mateo Sardoma, Jr. to bring methamphetamine into Guam.
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Defendant PAUL PEREZ, age 47, was sentenced on July 10, 2014, to 48 months imprisonment and five years of supervised release. Defendant PEREZ pleaded guilty to Conspiracy to Distribute Methamphetamine, in violation of 21 U.S.C. §§ 841 and 846. PEREZ received a shipment of methamphetamine on behalf of Defendant Mateo B. Sardoma, Jr. and mailed some of the cash profits to California.
U.S. Attorney Limtiaco stated, “Our community is not immune from the poison of methamphetamine. These cases illustrate the hard work our partners in law enforcement do every day to stop the distribution of methamphetamine into Guam.” These three defendants were witnesses in the U.S. v. Mateo B. Sardoma, Jr. aka “Mat”, Rudy P.H. Sablan, Maria C. Edrosa aka “Cristina”, et al., which is the product of an extensive investigation by the Organized Crime Drug Enforcement Task Force (OCDETF), a focused multi-agency, multi-jurisdictional task force investigating and prosecuting the most significant drug trafficking organizations throughout the United States by leveraging the combined expertise of federal, state and local law enforcement agencies.
The investigations were conducted by Special Agents and Task Force Officers at the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), the U.S. Department of Homeland Security-Homeland Security Investigations (DHS-HSI) and the Drug Enforcement Administration (DEA). The cases were prosecuted by Assistant U.S. Attorney Fred Black.
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Alabama Woman Convicted of Stolen Identity Refund FraudRead the Press Release
A jury found a Dothan, Alabama, woman guilty of conspiring to defraud the government through the filing of false tax returns, 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 today.
Nina Macena, 32, was also found guilty of three counts of wire fraud and three counts of aggravated identity theft.
According to evidence from the trial, Macena provided stolen identities to Ivory Bolen, also of Dothan, who used the identities to file false tax returns that fraudulently requested refunds from the government. Bolen would attempt to have the refunds deposited onto prepaid debit cards, which would be mailed to addresses controlled by Bolen and Macena. Macena obtained the identities from Roderick Neal, a former bail bondsman in Dothan, who had access to the personal information of individuals who had been detained at the Dothan City Jail. Both Bolen and Neal previously pleaded guilty to their involvement in the scheme.
The evidence from the trial also showed that Bolen, acting at the direction of law enforcement, made several phone calls to Macena asking her to obtain more identities. Macena agreed to do so and said she would attempt to get more identities from a “friend” at “the bonding company.” Macena also stated in the calls that she had stolen identities in a storage unit. The next day federal agents executed a search warrant at Macena’s storage unit and seizedstolen identities and prepaid debit cards in the names of victims of the scheme. Altogether, Bolen filed tax returns claiming more than $300,000 in refunds using the stolen identities provided by Macena. The Internal Revenue Service (IRS), however, successfully stopped a number of the fraudulent returns.
Macena testified in her own defense at trial and admitted that she had obtained information from Neal for Bolen, but claimed that she was unaware of the nature of the information. She also testified that she stored items for Bolen in her storage unit, but that she was unaware of what she was storing.
Macena was ultimately convicted by the jury on all counts in the indictment. At sentencing Oct. 23, she faces a statutory maximum sentence of 10 years in prison for the conspiracy count, a statutory maximum sentence of 20 years in prison for the three wire fraud convictions and a mandatory sentence of two years in prison for the aggravated identity theft convictions. Her actual sentence, however, will be decided by a federal judge after considering the federal sentencing guidelines and statutory sentencing factors.
This case was investigated by special agents of the IRS - Criminal Investigation. Trial Attorneys Jason Poole and Charles Edgar of the Tax Division prosecuted the case with the assistance 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.
Utah Man Sentenced to 60 Months for Religiously-Motivated Attack on Synagogue and Gun ChargesRead the Press Release
Macon Openshaw, 22, was sentenced today by U.S. District Court Judge Tena Campbell for the District of Utah to serve 60 months in prison for a bias-motivated attack at a local synagogue and for two unlawful gun possession charges. Openshaw was further ordered to pay $1,969 in restitution to the synagogue to repair the damage caused by his actions and was ordered to serve three years of supervised release following completion of his prison term.
On April 16, 2014, Openshaw pleaded guilty to the civil rights violation of damaging the synagogue and to the gun charges. As part of his plea, Openshaw admitted to firing three rounds from a Walther .22 caliber handgun at the Congregation Kol Ami synagogue in Salt Lake City in 2012. At the time of the attack, there were no congregants inside of the synagogue. Openshaw said he shot the synagogue because of its religious character. Openshaw also admitted to possessing a handgun with a destroyed serial number, which was the same handgun he used to shoot the synagogue. He also admitted to possessing several firearms and ammunition while he was subject to a protective order.
“Religiously-motivated violence cannot be tolerated by civil society,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division. “The department stands ready to combat violence based on a person’s religion, and will continue to prosecute these hate crimes vigorously.”
“Every person living in Utah has the right to be free from intimidating and threatening conduct,” said Acting U.S. Attorney Carlie Christensen for the District of Utah. “The U.S. Attorney’s Office in Utah has a strong history of prosecuting those who violate the civil rights of others in our communities.”
This case was investigated by the FBI and is being prosecuted by Assistant U.S. Attorney Carlos Esqueda of the U.S. Attorney’s Office for the District of Utah and Trial Attorney Nicholas Durham of the Civil Rights Division’s Criminal Section.
Justice Department and the Pennsylvania Office of Attorney General Require Divestiture from Sinclair Broadcast Group in Order to Proceed with Its Acquisition of Perpetual Corp.Read the Press Release
The Department of Justice announced today that it will require Sinclair Broadcast Group and Perpetual Corp. to divest their interests in WHTM-TV, an ABC affiliate in Harrisburg, Pennsylvania, in order to proceed with Sinclair’s proposed $963 million acquisition of Perpetual. The department said that, without the required divestiture, prices for broadcast television spot advertising would likely increase in parts of central Pennsylvania.
The department’s Antitrust Division and the Pennsylvania Office of Attorney General filed a civil antitrust lawsuit today in the U.S. District Court for the District of Columbia to block the proposed acquisition. At the same time, the department filed a proposed settlement that, if approved by the court, would resolve the competitive concerns alleged in the lawsuit.
“Perpetual’s WHTM-TV competes directly with WHP-TV and WLYH-TV, two stations owned or operated by Sinclair, in the sale of broadcast television spot advertising in parts of central Pennsylvania,” said Bill Baer, Assistant Attorney General in charge of the Department of Justice’s Antitrust Division. “The rivalry between the stations has helped to constrain advertising rates, and without the divestiture, advertisers on stations in this area would likely have paid higher prices.”
The department’s complaint alleges that the proposed acquisition would lessen competition in broadcast television spot advertising in the Harrisburg-Lancaster-Lebanon-York, Pennsylvania, designated market area (DMA). According to the complaint, the merging stations are relatively close substitutes for many advertisers, with similar demographic profiles and competing independent local news operations. As a result of the acquisition, Sinclair would own or control three of the six broadcast television stations selling advertising in the area, and advertisers could be forced to accept price increases due to the loss of competition. To remedy this harm, the proposed settlement requires Sinclair and Perpetual to divest all assets primarily used in the operation of WHTM‑TV to Media General, an independent purchaser approved by the United States.
The department also analyzed the likelihood of competitive harm in Charleston, South Carolina, where Sinclair will acquire ABC affiliate WCIV-TV as part of the proposed acquisition. Cunningham Broadcasting, a company with partnership and operation agreements with Sinclair around the country, owns the Charleston FOX affiliate, WTAT-TV. Due to the close ties between Sinclair and Cunningham, the department’s competitive analysis treated the relationship between the ABC affiliate Sinclair is acquiring, WCIV-TV, and the Cunningham-owned WTAT-TV as akin to a merger of those stations. The department’s investigation and antitrust analysis of the Charleston market revealed that advertisers do not largely view the stations as close substitutes, and even a full merger would not likely result in a substantial lessening of competition.
Sinclair, a Maryland corporation with headquarters in Hunt Valley, Maryland, owns or operates more than 145 broadcast television stations nationwide. Sinclair’s WHP-TV is the CBS affiliate in the Harrisburg-Lancaster-Lebanon-York DMA. Additionally, Sinclair operates WLYH-TV, the CW affiliate for the area, under an existing agreement with Nexstar Broadcasting, which is not a party to the proposed settlement.
Perpetual, a Delaware corporation with its headquarters in Arlington, Virginia, owns and operates seven broadcast television stations in six markets throughout the United States. Perpetual’s WHTM‑TV is the ABC affiliate in the Harrisburg-Lancaster-Lebanon-York DMA.
Media General, a Virginia corporation with headquarters in Richmond, Virginia, owns or operates more than 28 broadcast television stations nationwide. Media General does not currently own or operate any broadcast television stations in the Harrisburg-Lancaster-Lebanon-York DMA.As required by the Tunney Act, the proposed settlement, along with a competitive impact statement, will be published in the Federal Register. Any person may submit written comments concerning the proposed settlement during a 60‑day comment period to Scott A. Scheele, Chief, Telecommunications and Media Enforcement Section, Antitrust Division, U.S. Department of Justice, 450 Fifth Street, N.W., Suite 7000, Washington, D.C. 20530. At the conclusion of the 60‑day comment period, the U.S. District Court for the District of Columbia may approve the proposed settlement upon finding that it is in the public interest.
Justice Department Releases Best Practices Guide to Reform HIV-Specific Criminal Laws to Align with Scientifically-Supported FactorsRead the Press Release
The Justice Department announced today that it has released a Best Practices Guide to Reform HIV-Specific Criminal Laws to Align with Scientifically-Supported Factors . This guide provides technical assistance regarding state laws that criminalize engaging in certain behaviors without disclosing known HIV-positive status. The guide will assist states to ensure that their policies reflect contemporary understanding of HIV transmission routes and associated benefits of treatment and do not place unnecessary burdens on individuals living with HIV/AIDS.
This guide is in follow-up to the department’s March 15, 2014, article published with the Centers for Disease Control and Prevention (CDC), Prevalence and Public Health Implications of State Laws that Criminalize Potential HIV Exposure in the United States, which examined HIV-specific criminal laws. Generally, these laws do not account for scientifically-supported level of risk by type of activities engaged in or risk reduction measures undertaken. As a result, many of these state laws criminalize behaviors that the CDC regards as posing either no risk or negligible risk for HIV transmission even in the absence of risk reduction measures.
“While initially well intentioned, these laws often run counter to current scientific evidence about routes of HIV transmission, and may run counter to our best public health practices for prevention and treatment of HIV,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division. “The department is committed to using all of the tools available to address the stigma that acts as a barrier to effectively addressing this epidemic.”
The department’s efforts to provide guidance on HIV-specific criminal laws are part of its ongoing commitment to implementation of the National HIV/AID Strategy, released in 2010. Today’s guide furthers the expectation from the Office of National AIDS Policy that we tackle misconceptions, stigma and discrimination to break down barriers to care for those people living with HIV in response to the President’s Executive Order last year on the HIV Care Continuum Initiative. For more information on the National HIV/AIDS Strategy, visit the White House website .
For more information on the ADA and HIV, visit this website . Those interested in finding out more about obligations under the ADA may call the Justice Department’s toll-free ADA information line at 800-514-0301 or 800-514-0383 (TDD), or access the ADA website .
Happy’s Pizza Franchise Owner and Nominee Owner Plead Guilty in Tax Fraud SchemeRead the Press Release
Two West Bloomfield, Michigan, residents pleaded guilty in the U.S. District Court for the Eastern District of Michigan today, announced the Justice Department and Internal Revenue Service (IRS).
Arkan Summa, an owner of numerous Happy’s Pizza franchises, pleaded guilty to corruptly endeavoring to obstruct or impede the due administration of the internal revenue laws. Tagrid Summa Bashi, Summa’s sister and a nominee owner, pleaded guilty to willfully delivering false documents to the IRS.
A multiple count indictment was unsealed July 16, 2013 alleging that from approximately June 2004 through April 2011, Summa executed a scheme in which he diverted gross receipts, underreported wages and caused the taxable income and payroll tax information of specific Happy’s Pizza franchises to be underreported to the IRS.
According to the information filed in court, in 2009, Bashi caused false payroll information forms to be submitted to the IRS. Documents filed with the court indicate Summa’s obstruction of the IRS resulted in a tax loss of approximately $199,847, and Bashi caused approximately $55,000 in wages to be underreported to the IRS through her false submission.
For the obstruction charge, Summa faces a statutory maximum sentence of three years in prison and a fine of up to $250,000. Bashi faces a statutory maximum sentence of 12 months in prison and a fine of up to $100,000. Sentencing for both defendants is scheduled for Oct. 23.
This case was investigated by IRS – Criminal Investigation, the Drug Enforcement Administration and the FBI. It is being prosecuted by Senior Litigation Counsel Corey Smith and Trial Attorney Mark McDonald of the Justice Department’s Tax Division.
Additional information about the Tax Division and its enforcement efforts may be found at the division website .
Father and Son Pizza Store Owners Plead Guilty to Tax FraudRead the Press Release
Thair Alwan and his son Saill Fadhil, owners and operators of Raleigh, North Carolina, area pizza stores, pleaded guilty today to willfully filing false tax returns in the U.S. Court for the Eastern District of North Carolina, the Justice Department and Internal Revenue Service (IRS) announced today.
According to court documents and statements made in court, Alwan, of Garner, North Carolina, and Fadhil, of Raleigh, own and operate a number of pizza stores in and around Raleigh called I Love NY Pizza. During the tax years 2008 and 2009, Alwan and Fadhil willfully skimmed almost all of the company’s cash receipts from their various stores and filed false federal income tax returns which failed to report the flow-through income, resulting in substantial tax underpayments. The skimmed receipts – estimated at $1.34 million – were used for personal expenditures or deposited into their personal bank accounts. When making cash deposits, the defendants structured the transactions under $10,000 and avoided the filing of Currency Transaction Reports.
According to court documents and statements made in court, I Love NY Pizza had two stores locations in Raleigh and one store location in Knightdale by 2008, and in 2009 another location in Apex was added. Fadhil eventually assumed management responsibility for a location after he graduated from college. Although employees stated that the business was at least 40 percent cash sales, cash deposits into the corporate bank account, as a percentage of total deposits, were 1.3 percent in 2008 and 2.3 percent in 2009. Between 2007 and 2010, Alwan made or caused 73 currency deposits into his personal accounts. Of the 73 deposits, 50 were at least $9,000, and the majority of these were in the amount of $9,980. None of the deposits were more than $10,000.
Alwan and Fadhil each face a statutory maximum sentence of three years in prison, one year of supervised release and a maximum fine of $250,000 per count at their sentencings, which have not yet been scheduled. Alwan and Fadhil have also agreed to pay restitution to the IRS.
The case was investigated by special agents from IRS-Criminal Investigation and prosecuted by Trial Attorney Todd Ellinwood of the Justice Department's Tax Division and Assistant U.S. Attorney Adam Hulbig of the Eastern District of North Carolina.
Additional information about the Tax Division and its enforcement efforts may be found a t the division website .
Justice Department, Federal and State Partners Secure Record $7 Billion Global Settlement with Citigroup for Misleading Investors About Securities Containing Toxic MortgagesRead the Press Release
The Justice Department, along with federal and state partners, today announced a $7 billion settlement with Citigroup Inc. to resolve federal and state civil claims related to Citigroup’s conduct in the packaging, securitization, marketing, sale and issuance of residential mortgage-backed securities (RMBS) prior to Jan. 1, 2009. The resolution includes a $4 billion civil penalty – the largest penalty to date under the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA). As part of the settlement, Citigroup acknowledged it made serious misrepresentations to the public – including the investing public – about the mortgage loans it securitized in RMBS. The resolution also requires Citigroup to provide relief to underwater homeowners, distressed borrowers and affected communities through a variety of means including financing affordable rental housing developments for low-income families in high-cost areas. The settlement does not absolve Citigroup or its employees from facing any possible criminal charges.
This settlement is part of the ongoing efforts of President Obama’s Financial Fraud Enforcement Task Force’s RMBS Working Group, which has recovered $20 billion to date for American consumers and investors.
“This historic penalty is appropriate given the strength of the evidence of the wrongdoing committed by Citi,” said Attorney General Eric Holder. “The bank's activities contributed mightily to the financial crisis that devastated our economy in 2008. Taken together, we believe the size and scope of this resolution goes beyond what could be considered the mere cost of doing business. Citi is not the first financial institution to be held accountable by this Justice Department, and it will certainly not be the last.”
The settlement includes an agreed upon statement of facts that describes how Citigroup made representations to RMBS investors about the quality of the mortgage loans it securitized and sold to investors. Contrary to those representations, Citigroup securitized and sold RMBS with underlying mortgage loans that it knew had material defects. As the statement of facts explains, on a number of occasions, Citigroup employees learned that significant percentages of the mortgage loans reviewed in due diligence had material defects. In one instance, a Citigroup trader stated in an internal email that he “went through the Diligence Reports and think[s] [they] should start praying . . . [he] would not be surprised if half of these loans went down. . . It’s amazing that some of these loans were closed at all.” Citigroup nevertheless securitized the loan pools containing defective loans and sold the resulting RMBS to investors for billions of dollars. This conduct, along with similar conduct by other banks that bundled defective and toxic loans into securities and misled investors who purchased those securities, contributed to the financial crisis.
“Today, we hold Citi accountable for its contributing role in creating the financial crisis, not only by demanding the largest civil penalty in history, but also by requiring innovative consumer relief that will help rectify the harm caused by Citi's conduct,” said Associate Attorney General Tony West. “In addition to the principal reductions and loan modifications we've built into previous resolutions, this consumer relief menu includes new measures such as $200 million in typically hard-to-obtain financing that will facilitate the construction of affordable rental housing, bringing relief to families pushed into the rental market in the wake of the financial crisis.”
Of the $7 billion resolution, $4.5 billion will be paid to settle federal and state civil claims by various entities related to RMBS: Citigroup will pay $4 billion as a civil penalty to settle the Justice Department claims under FIRREA, $208.25 million to settle federal and state securities claims by the Federal Deposit Insurance Corporation (FDIC), $102.7 million to settle claims by the state of California, $92 million to settle claims by the state of New York, $44 million to settle claims by the state of Illinois, $45.7 million to settle claims by the Commonwealth of Massachusetts, and $7.35 to settle claims by the state of Delaware.
Citigroup will pay out the remaining $2.5 billion in the form of relief to aid consumers harmed by the unlawful conduct of Citigroup. That relief will take various forms, including loan modification for underwater homeowners, refinancing for distressed borrowers, down payment and closing cost assistance to homebuyers, donations to organizations assisting communities in redevelopment and affordable rental housing for low-income families in high-cost areas. An independent monitor will be appointed to determine whether Citigroup is satisfying its obligations. If Citigroup fails to live up to its agreement by the end of 2018, it must pay liquidated damages in the amount of the shortfall to NeighborWorks America, a non-profit organization and leader in providing affordable housing and facilitating community development.
The U.S. Attorney’s Offices for the Eastern District of New York and the District of Colorado conducted investigations into Citigroup’s practices related to the sale and issuance of RMBS between 2006 and 2007.
“The strength of our financial markets depends on the truth of the representations that banks provide to investors and the public every day,” said U.S. Attorney John Walsh for the District of Colorado, Co-Chair of the RMBS Working Group. “Today's $7 billion settlement is a major step toward restoring public confidence in those markets. Due to the tireless work by the Department of Justice, Citigroup is being forced to take responsibility for its home mortgage securitization misconduct in the years leading up to the financial crisis. As important a step as this settlement is, however, the work of the RMBS working group is far from done, we will continue to pursue our investigations and cases vigorously because many other banks have not yet taken responsibility for their misconduct in packaging and selling RMBS securities.”
“After nearly 50 subpoenas to Citigroup, Trustees, Servicers, Due Diligence providers and their employees, and after collecting nearly 25 million documents relating to every residential mortgage backed security issued or underwritten by Citigroup in 2006 and 2007, our teams found that the misconduct in Citigroup’s deals devastated the nation and the world’s economies, touching everyone,” said U.S. Attorney of the Eastern District of New York Loretta Lynch. “The investors in Citigroup RMBS included federally-insured financial institutions, as well as a host of states, cities, public and union pension and benefit funds, universities, religious charities, and hospitals, among others. These are our neighbors in Colorado, New York and around the country, hard-working people who saved and put away for retirement, only to see their savings decimated.”
This settlement resolves civil claims against Citigroup arising out of certain securities packaged, securitized, structured, marketed, and sold by Citigroup. The agreement does not release individuals from civil charges, nor does it release Citigroup or any individuals from potential criminal prosecution. In addition, as part of the settlement, Citigroup has pledged to fully cooperate in investigations related to the conduct covered by the agreement.
Michael Stephens, Acting Inspector General for the Federal Housing Finance Agency said, “Citigroup securitized billions of dollars of defective mortgages, after which investors suffered enormous losses by purchasing RMBS from Citi not knowing about those defects. Today’s settlement is another significant step by FHFA-OIG and its law enforcement partners to hold accountable those who committed acts of fraud and deceit in the lead up to the financial crisis, and is a necessary step toward reviving a sound RMBS market that is crucial to the housing industry and the American economy. We are proud to have worked with the Department of Justice, the U.S. Attorneys’ Offices in the Eastern District of New York and the District of Colorado. They have been great partners and we look forward to our continued work together.”
The underlying investigation was led by Assistant U.S. Attorneys Richard K. Hayes, Kevin Traskos, Lila Bateman, John Vagelatos, J. Chris Larson and Edward K. Newman, with the support of agents from the Office of the Inspector General for the Federal Housing Finance Agency, in conjunction with the President’s Financial Fraud Enforcement Task Force’s RMBS Working Group.
The RMBS Working Group is a federal and state law enforcement effort focused on investigating fraud and abuse in the RMBS market that helped lead to the 2008 financial crisis. The RMBS Working Group brings together more than 200 attorneys, investigators, analysts and staff from dozens of state and federal agencies including the Department of Justice, 10 U.S. Attorneys’ Offices, the FBI, the Securities and Exchange Commission (SEC), the Department of Housing and Urban Development (HUD), HUD’s Office of Inspector General, the FHFA-OIG, the Office of the Special Inspector General for the Troubled Asset Relief Program, the Federal Reserve Board’s Office of Inspector General, the Recovery Accountability and Transparency Board, the Financial Crimes Enforcement Network, and more than 10 state Attorneys General offices around the country.
The RMBS Working Group is led by its Director Geoffrey Graber and its five co-chairs: Assistant Attorney General for the Civil Division Stuart Delery, Assistant Attorney General for the Criminal Division Leslie Caldwell, Director of the SEC’s Division of Enforcement Andrew Ceresney, U.S. Attorney for the District of Colorado John Walsh and New York Attorney General Eric Schneiderman.
Learn more about the RMBS Working Group and the Financial Fraud Enforcement Task Force at: www.stopfraud.gov
Related Materials:
SOF
Settlement Agreement
Appendix 1
Annex 2
Annex 3Former University of Virginia Dean Sentenced on Child Pornography ChargesRead the Press Release
A Crozet, Virginia man who previously pleaded guilty to child pornography charges was sentenced today in the U.S. District Court for the Western District of Virginia in Charlottesville for distribution and possession of child pornography.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Timothy J. Heaphy for the Western District of Virginia and Special Agent in Charge Adam S. Lee of the FBI’s Richmond Field Office made the announcement.
Michael G. Morris, who used the screen name “funshooter2006,” age 50, of Crozet, Virginia was indicted in 2013 and pleaded guilty on April 21, 2014 to two counts of distributing or receiving images of child pornography and one count of possessing child pornography. During the offenses charged, Morris was employed as an associate dean at the University of Virginia’s McIntyre School of Commerce. Morris was sentenced today before U.S. District Judge Norman K. Moon to 106 months in prison followed by 20 years of supervised release.
“Michael Morris was an associate dean at one of our country’s top universities, but instead of inspiring young minds academically, he was sharing and viewing pornographic images of young children,” said Assistant Attorney General Caldwell. “Today’s sentence demonstrates that those who trade and possess child pornography, no matter what positions of authority they may hold, will face the consequences for fueling an industry that causes immense damage to children.”
“Each and every time defendants like Mr. Morris download and share images depicting child pornography the children in those images suffer re-victimization,” U.S. Attorney Timothy J. Heaphy said today. “The Department will continue to use all available resources to seek out those who trade in this lurid material and bring them to justice.”
“The Richmond-based Child Exploitation Task Force will pursue and bring to justice anyone who produces, distributes, or possesses child pornography,” said Special Agent Lee. “The Morris case is an example of the FBI’s commitment to Virginia’s communities to keep our kids safe. I would like to thank the United States Attorney’s Office for achieving a positive conclusion to this case, the Charlottesville Police Department for their commitment to the Task Force, and the Task Force officer and FBI agent who led the case for their outstanding investigative work.”
According to evidence presented during the plea hearing and in court documents, a law enforcement officer, acting in an undercover capacity, successfully downloaded videos depicting minors engaged in sexually explicit conduct that Morris had made available to him on a publicly available file-sharing site on Jan. 6, 2012 and March 19, 2013. Morris also admitted that on Nov. 6, 2013, he possessed images or videos depicting prepubescent minors who the defendant knew had not attained 12 years of age. Investigators recovered computers and other items that contained child pornography during a search of Morris’s home.
The case was investigated by the FBI, with the assistance of the Charlottesville Police Department and the Department of Justice’s High Technology Investigative Unit. The case was prosecuted by Trial Attorney Herbrina Sanders of the Criminal Division’s Child Exploitation and Obscenity Section and Assistant U.S. Attorney Nancy Healey of the Western District of Virginia.Two Former Chesapeake, Virginia, Subcontractors Sentenced for Bribery, ConspiracyRead the Press Release
Dwayne A. Hardman, 44, co-founder of two government contracting companies that sought business from the United States Navy Military Sealift Command (MSC), and Adam C. White, 40, former vice president and co-owner of one of Hardman’s government contracting companies, were sentenced for bribery and conspiracy. On July 9, 2014, Hardman was sentenced to 96 months in prison, followed by three years of supervised release. White was sentenced today to serve 24 months in prison, followed by three years of supervised release. Hardman was ordered to forfeit $144,000, and White was ordered to forfeit $57,000.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, United States Attorney Dana J. Boente for the Eastern District of Virginia, Special Agent in Charge Royce E. Curtin of the FBI’s Norfolk Office, Acting Executive Assistant Director Charles T. May Jr. of the Naval Criminal Investigative Service (NCIS) and Special Agent in Charge Robert Craig of the Defense Criminal Investigative Service (DCIS) Mid-Atlantic Field Office made the announcement today after sentencing by United States Chief Judge Rebecca Beach Smith of the Eastern District of Virginia.
According to court documents, Hardman and White participated in a five-year bribery scheme in which they and several co-conspirators provided more than $265,000 in cash bribes, among other things, to two public officials working for MSC, in an illegal effort to influence those public officials to provide favorable treatment to Hardman and White’s companies in connection with United States government contracting work.
On Feb. 18, 2014, Hardman pleaded guilty to a criminal information charging him with bribery. According to the plea documents, Hardman was the co-founder of two government contracting companies, referred to as Company A and Company B, located in Chesapeake, Virginia that sought contracting business from MSC, which is the leading provider of transportation for the United States Navy. At his plea hearing, Hardman admitted that beginning in March 2005, he and other Company A employees, provided approximately $3,000 in cash bribes per month to two MSC public officials, Kenny E. Toy, the former Afloat Programs Manager for the MSC’s N6 Command, Control, Communication, and Computer Systems Directorate, and Scott B. Miserendino Sr., a former government contractor who performed work for the MSC. Those Company A employees included Roderic J. Smith, the former president, co-owner and co-founder of Company A; Adam C. White, a former vice president and co-owner of Company A; and Michael P. McPhail a former project manager and co-owner of Company A. Hardman also admitted that in May 2009, he and Timothy S. Miller, co-founder of Company B, provided $50,000 in cash bribes to Toy and Miserendino. In addition to the cash bribes, Hardman stated that he and his co-conspirators provided Toy and Miserendino flat screen televisions, a paid vacation to Nags Head in North Carolina, a personal loan and installation of hardwood floors in Toy’s residence.
In exchange for these bribes, Toy and Miserendino provided favorable treatment in connection with MSC-related business to both Company A and Company B. During the bribery scheme, Company A received approximately $3 million in MSC-related business, and Company B received approximately $2.4 million in MSC-related business.
As part of his guilty plea, Hardman also admitted that, in approximately November or December 2010, Hardman threatened to report the bribery activities to law enforcement authorities if his co-conspirators did not provide him money. In total, Hardman admitted that he received approximately $85,000 from his co-conspirators, including Smith, Toy and Miserendino, in exchange for not reporting the bribery scheme to law enforcement authorities.
On April 4, 2014, White pleaded guilty to a criminal information charging him with conspiracy to commit bribery. At his plea hearing, White admitted that from approximately April 2005 until approximately March 2006, he personally contributed approximately $26,000 in cash bribe payments for Toy and Miserendino, and White was aware that other co-conspirators, including Hardman, Smith and McPhail, were also contributing cash and other things of value to be provided to Toy and Miserendino in exchange for their official assistance in providing MSC-related business.
Earlier this year, three other individuals pleaded guilty in connection with the bribery scheme. On Feb. 12, 2014, Toy, the former Afloat Programs Manager, pleaded guilty to accepting bribes from Hardman, White, and others. On Feb. 19, 2014, McPhail pleaded guilty to conspiracy to commit bribery. On March 5, 2014, Smith pleaded guilty to conspiracy to bribe public officials.
On June 23, 2014, United States District Judge Henry Coke Morgan of the Eastern District of Virginia sentenced Smith to 48 months in prison followed by 1 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 Miller. 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 of the Eastern District of Virginia.
The charges in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
The case was investigated by Special Agents of the FBI, NCIS, and DCIS. The case is being 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.Two California Men Plead Guilty to Conspiracy to Engage in Sex Trafficking by Force, Fraud and CoercionRead the Press Release
Two Long Beach, California, men pleaded guilty today to conspiracy charges arising from a sex trafficking scheme that exploited adult women for prostitution. Roshaun Nakia Porter, 39, and Marquis Monte Horn, 35, both pleaded guilty before Judge Josephine L. Staton in the U.S. District Court for the Central District of California to conspiring to engage in sex trafficking by force, fraud and coercion. Sentencing has been set for Oct. 24, 2014, and each defendant faces a sentence of up to life imprisonment.
According to documents filed in court, from October 2009 through April 2012, Porter and Horn conspired together and with others to recruit, entice, harbor, transport and provide women to engage in commercial sex acts, using various coercive means to compel the women to engage in prostitution for the defendants’ financial benefit. Porter and Horn’s scheme of force, fraud and coercion included false and deceptive internet advertisements they used to lure the victims into romantic relationships with the defendants, and psychological manipulation and control to cause the victims to engage in commercial sex acts for the defendants’ financial benefit.
“The Department of Justice is committed to the vigorous prosecution of defendants who prey upon and exploit vulnerable individuals for their own financial gain,” said Acting Assistant Attorney General Jocelyn Samuels for the Justice Department’s Civil Rights Division. “We will continue to pursue justice on behalf of victims of human trafficking to restore their rights and dignity and to hold their traffickers accountable.”
“Human trafficking is a horrific crime that causes significant damage to victims who are often forced to commit unspeakable acts,” said U.S. Attorney André Birotte Jr. for the Central District of California. “This scheme to control and manipulate victims forced to work in the sex trade has come to an end. With today’s guilty pleas, I hope that healing for the victims can begin.”
“Sex trafficking is not something that only happens outside of the United States, but victimizes Americans in our own backyards,” said Assistant Director of the FBI Los Angeles Field Office Bill Lewis. “In this case, the defendants defrauded victims and forced them to work as sex slaves under threat to themselves and their families. I hope this conviction reminds vigilant members of the public to report the signs of human and sex trafficking to law enforcement when they encounter it.”
This matter was investigated by the FBI and is being prosecuted by Assistant U.S. Attorney Sandy Leal of the U.S. Attorney’s Office for the Central District of California and Trial Attorney Daniel H. Weiss of the Civil Rights Division’s Human Trafficking Prosecution Unit.
South Florida Man Sentenced to Prison for $10.5 Million Medicare Fraud SchemeRead the Press Release
A south Florida man was sentenced today in federal court in Tampa, Florida, to serve 48 months in prison in connection with a $10.5 million Medicare fraud scheme involving physical and occupational therapy services.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney A. Lee Bentley III for the Middle District of Florida, Acting Special Agent in Charge Ryan Lynch of the U.S. Health and Human Services Office of Inspector General (HHS-OIG) region including all of Florida, and Special Agent in Charge Paul Wysopal of the FBI’s Tampa Field Office made the announcement.
Luis Alberto Garcia Perojo (Garcia), 43, previously pleaded guilty to an information charging him with conspiracy to commit health care fraud. In addition to his prison term, he was sentenced to serve three years of supervised release and ordered to pay $6,248,056 in restitution, jointly and severally with his co-conspirators.
According to documents filed in the case, Garcia conspired with others to execute a health care fraud scheme through Renew Therapy Center of Port St. Lucie LLC (Renew Therapy), a comprehensive outpatient rehabilitation facility that he helped operate. From November 2007 through August 2009, Renew Therapy submitted approximately $10,549,361 in fraudulent claims for reimbursement to Medicare for therapy services that were not legitimately prescribed and not legitimately provided to Medicare beneficiaries. As a result of those fraudulent claims, Medicare deposited approximately $6,248,056 into a Renew Therapy bank account. The fraud proceeds in that account were subsequently disbursed to various entities, including $1,847,222 to Ariguanabo Investment Group Inc. and IRE Diagnostic Center Inc. Garcia was President of Ariguanabo Investment Group and had authority over bank accounts for Ariguanabo Investment Group and IRE Diagnostic Center, both of which were shell companies. Garcia and others used this money from Renew Therapy for, among other purposes, paying kickbacks to obtain Medicare beneficiary identifying information that was used in Renew Therapy’s fraudulent reimbursement claims.
This case is being investigated by HHS-OIG and the FBI 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 Middle District of Florida. This case is being prosecuted by Trial Attorney Christopher J. Hunter 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 more than 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 .Department of Justice Provides Update on Gameover Zeus and Cryptolocker DisruptionRead the Press Release
The Justice Department today filed a status report with the United States District Court for the Western District of Pennsylvania updating the court on the progress in disrupting the Gameover Zeus botnet and the malicious software known as Cryptolocker. The disruption began in late May, when the Justice Department implemented a series of Court-authorized measures to neutralize Gameover Zeus and Cryptolocker - two of the most sophisticated and destructive forms of malicious software in existence.
In the status report, the Justice Department informed the Court that the technical and legal measures undertaken to disrupt Gameover Zeus and Cryptolocker have proven successful, and that significant progress has been made in remediating computers infected with Gameover Zeus.
The Justice Department reported that all or nearly all of the active computers infected with Gameover Zeus have been liberated from the criminals’ control and are now communicating exclusively with the substitute server established pursuant to court order. The Justice Department also reported that traffic data from the substitute server shows that remediation efforts by internet service providers and victims have reduced the number of computers infected with Gameover Zeus by 31 percent since the disruption commenced.
The Justice Department also reported that Cryptolocker has been neutralized by the disruption and cannot communicate with the infrastructure used to control the malicious software. As a result, Cryptolocker is effectively non-functional and unable to encrypt newly infected computers.
Computer users who believe they may be infected with Gameover Zeus are encouraged to visit the Department of Homeland Security’s dedicated Gameover Zeus webpage, which is located at www.us-cert.gov/gameoverzeus . Among other resources, the webpage includes links to tools from trusted vendors that can detect and remove the Gameover Zeus infection.Related Materials:
Status Report
Motion for Default
Declaration in Support of MotionCaribbean-Based Investment Advisors and Attorney Plead Guilty to Using Offshore Accounts to Launder and Conceal FundsRead the Press Release
Joshua Vandyk, a U.S. citizen, and Eric St-Cyr and Patrick Poulin, Canadian citizens, have each pleaded guilty to conspiring to launder monetary instruments, the Justice Department and Internal Revenue Service (IRS) announced today.
Patrick Poulin, 41, pleaded guilty today, Vandyk, 34, pleaded guilty on June 12, and St-Cyr, 50, pleaded guilty on June 27. The three defendants were indicted by a grand jury in the U.S. District Court for the Eastern District of Virginia on March 6, and the indictment was unsealed on March 12 after the defendants were arrested in Miami.
According to the plea agreements and statements of facts, Vandyk, St-Cyr and Poulin conspired to conceal and disguise the nature, location, source, ownership and control of property believed to be the proceeds of bank fraud, specifically $2 million. Vandyk, St-Cyr and Poulin assisted undercover law enforcement agents posing as U.S. clients in laundering purported criminal proceeds through an offshore structure designed to conceal the true identity of the proceeds’ owners. Vandyk and St-Cyr invested the laundered funds on the clients’ behalf and represented that the funds would not be reported to the U.S. government.
“This investigation highlights the Justice Department’s commitment to worldwide enforcement of federal laws designed to ensure that U.S. taxpayers fully disclose and report all foreign income and assets,” said Deputy Assistant Attorney General Ronald A. Cimino of the Justice Department's Tax Division. “ The Tax Division is committed to using every tool available to hold these wrongdoers accountable .”
“These three defendants played a shell game by creating offshore entities designed to help their U.S. clients evade taxes and other legal requirements, and they used that same shell game to launder purported criminal proceeds,” said U.S. Attorney Dana J. Boente for the Eastern District of Virginia. “We are committed to working with our law enforcement partners to penetrate and combat these schemes wherever they occur.”
“Individuals who assist others in laundering criminal proceeds will be held accountable for their own criminal actions,” said IRS-Criminal Investigation Chief Richard Weber. “The defendants in this investigation had a blatant disrespect for the laws and laundered purported criminal proceeds through offshore structures to conceal the identity of the proceeds’ owners. IRS Criminal Investigation has ramped up its presence in the international arena and will aggressively pursue those who commit financial crimes.”
According to court documents, Vandyk and St-Cyr lived in the Cayman Islands and worked for an investment firm based in the Cayman Islands. St-Cyr was the founder and head of the investment firm, whose clientele included numerous U.S. citizens. Poulin, an attorney at a law firm based in Turks and Caicos, worked and resided in Canada as well as the Turks and Caicos. His clientele also included numerous U.S. citizens. Vandyk, St-Cyr and Poulin solicited U.S. citizens to use their services to hide assets from the U.S. government, including the IRS. Vandyk and St-Cyr directed the undercover agents posing as U.S. clients to create an offshore corporation with the assistance of Poulin and others because they and the investment firm did not want to appear to deal with U.S. clients. Vandyk, St-Cyr and Poulin used the offshore entity to move money into the Cayman Islands and used Poulin as a nominee intermediary for the transactions.
According to court documents, Poulin established an offshore corporation called Zero Exposure Inc. for the undercover agents posing as U.S. clients and served as a nominal board member in lieu of the clients. Poulin transferred approximately $200,000 that Poulin, St-Cyr and Vandyk believed to be the proceeds of bank fraud from the offshore corporation to the Cayman Islands, where Vandyk and St-Cyr invested those funds outside of the United States in the name of the offshore corporation. The investment firm represented that it would neither disclose the investments or any investment gains to the U.S. government, nor would it provide monthly statements or other investment statements to the clients. Clients were able to monitor their investments online through the use of anonymous, numeric passcodes. Upon request from the U.S. client, Vandyk and St-Cyr liquidated investments and transfer money, through Poulin, back to the United States. According to Vandyk and St-Cyr, the investment firm would charge clients higher fees to launder criminal proceeds than to assist them in tax evasion.
The case was investigated by special agents of the IRS-Criminal Investigation. Trial Attorneys Todd Ellinwood and Caryn Finley of the department’s Tax Division and Assistant U.S. Attorney Kosta Stojilkovic of the U.S. Attorney’s Office for the Eastern District of Virginia are prosecuting the case. The Justice Department and the IRS would like to thank the Royal Canadian Mounted Police, the Royal Cayman Islands Police Service and the Royal Turks and Caicos Islands Police Force for their assistance in this investigation.
Additional information about the Tax Division and its enforcement efforts may be found at the division website .
Bureau of Justice Statistics Releases Tribal Crime Data Collection Activities, 2014<br />Read the Press Release
This fourth annual report to Congress describes efforts to collect and improve data on crime and justice in Indian country, as required by the Tribal Law and Order Act of 2010. The report details the number of tribal law enforcement agencies reporting crime data to the FBI’s Uniform Crime Reporting program. It describes BJS’s first National Survey of Tribal Court Systems which will collect data on tribal courts in the lower 48 states and Alaska covering 566 tribes. The survey will also cover the tribal Courts of Federal Regulations that handle some offenses and resolve disputes among tribal members. It also summarizes tribal eligibility for Edward Byrne Memorial Justice Assistance Grant awards and the total funds awarded to tribes.
http://ojp.gov/newsroom/pressreleases/2014/ojppr071014.pdf
Attorney General Eric Holder to Deliver Keynote Address at Justice Department and Howard University Celebration of the 50th Anniversary of Civil Rights Act of 1964<br />Read the Press Release
Attorney General Eric Holder will deliver the keynote address at the Department of Justice’s 50th anniversary celebration of the Civil Rights Act of 1964. Secretary of Labor Thomas Perez, Secretary of Education Arne Duncan, Congresswoman Eleanor Holmes Norton, Deputy Attorney General James Cole, Associate Attorney General Tony West, Ambassador Andrew Young and Howard University Interim President Dr. Wayne A.I. Frederick will also deliver remarks at the event co-hosted by Howard University, on TUESDAY, JULY 15, 2014, at 10:00 a.m. EDT, to honor the civil rights movement and celebrate the groundbreaking act.
Journalist Charlayne Hunter-Gault will lead a panel discussion during the program on the impact of the Civil Rights Act of 1964 with Julian Bond, Howard University School of Law Associate Dean for Academic Affairs Lisa A. Crooms-Robinson, Joan Trumpauer Mulholland and Helen Zia.
The event will be live streamed at http://tinyurl.com/och84d4.
WHO: Attorney General Eric Holder, Secretary of Labor Thomas Perez, Secretary of Education Arne Duncan, Congresswoman Eleanor Holmes Norton, Deputy Attorney General James Cole, Associate Attorney General Tony West, Ambassador Andrew Young, Howard University Interim President Dr. Wayne A.I. Frederick, Howard University School of Law Associate Dean for Academic Affairs Lisa A. Crooms-Robinson, Julian Bond, Charlayne Hunter-Gault, Joan Trumpauer Mulholland, Helen Zia
WHAT: “The 50th Anniversary of the Civil Rights Act of 1964: Preserving Progress, Charting the Future”
WHEN: Tuesday, July 15, 2014
10:00 a.m. EDT
WHERE: Cramton Auditorium
Howard University
2455 6th St., N.W.
Washington, D.C.
OPEN PRESS
NOTE: All media must present government-issued photo I.D. (such as driver’s license) as well as valid media credentials. Media interested in attending must RSVP to Erica Lacy at [email protected] no later than 5:00 p.m. EDT, on Monday, July 14, 2014. Media may begin arriving at 8:30 a.m. EDT. All cameras must be pre-set and radios must be in place by 9:30 a.m. EDT. Pen and pad reporters must be in place by 9:50 a.m. EDT.Press inquiries regarding logistics should be directed to Erica Lacy at 202-514-2007 or at [email protected]. Press inquiries regarding interviews with Howard University staff should be directed to Rachel Mann at 202-308-8903 or at [email protected].
U.S. Branch of Canadian Company to Pay $2.5 Million Penalty for Shreveport, La., Wastewater PlantRead the Press Release
Houston-based CCS (USA) Inc. and several of its operating subsidiaries will pay a $2.5 million civil penalty relating to operations at its Shreveport, Louisiana, industrial wastewater treatment plant, the Department of Justice, U.S. Environmental Protection Agency (EPA) and the state of Louisiana announced today. The settlement will resolve violations of the Clean Water Act, the Clean Air Act and the hazardous waste law known as RCRA.
CCS acquired the plant in 2006 through its purchase of two closely held companies owned by John Emerson Tuma. Tuma is now serving a five-year prison sentence for illegally discharging untreated and improperly treated wastewater from the plant into the Red River and Shreveport Publicly Owned Treatment Works (POTW). Inspections by EPA and the Louisiana Department of Environmental Quality following the sale led to the discovery of these violations and others, including unpermitted storage and improper handling of hazardous wastes and sludge, unpermitted stormwater discharges and noncompliance with Clean Air Act requirements for benzene-containing wastes.
After discovering these violations, CCS ceased wastewater treatment operations at the facility. Under EPA supervision, CCS removed the hazardous wastes illegally stored there.
The $2.5 million civil penalty will be split evenly between the United States and state of Louisiana.
The stipulation of settlement, filed in the U.S. District Court for the Western District of Louisiana, is subject to a 45-day public comment period and approval by the federal court.
Puerto Rico Police Officers and Civilians Charged with Federal Crimes in Connection with July 2012 Robbery in Bayamon, Puerto RicoRead the Press Release
Three Police of Puerto Rico (POPR) officers and two civilians were charged with robbery, firearms violations, drug conspiracy and civil rights violations for their involvement in a July 2012 robbery in Bayamon, Puerto Rico, and an additional POPR officer was charged with lying to federal agents.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Rosa Emilia Rodríguez-Vélez of the District of Puerto Rico and Special Agent in Charge Carlos Cases of the FBI’s San Juan Field Office made the announcement.
Jorge Fernandez-Aviles, 48, Fernando Reyes-Rojas, 42, and David Figueroa-Rodríguez, 32, were charged in an indictment returned yesterday in the District of Puerto Rico with one count of conspiracy to commit robbery and one count of conspiracy to commit civil rights violations; Fernandez and Reyes were also charged with one count of conspiracy to possess and distribute controlled substances and one count of firearms possession. Alexander Mir-Hernandez, 39, was charged with one count of false statements for lying to federal agents about his role and the roles of others in the July 2012 robbery.
Pedro Lopez-Torres, 35, and Luis Ramos-Figueroa, 38, were each charged by information on June 25, 2014, for their roles in the July 2012 robbery and other crimes. Lopez and Ramos pleaded guilty before U.S. District Judge José A. Fusté of the District of Puerto Rico on the same day. The charges against them were unsealed today.
At the time of the crimes charged, Jorge Fernandez-Aviles was a sergeant with POPR, Pedro Lopez-Torres, Luis Ramos-Figueroa and Alexander Mir-Hernandez were POPR officers, and Fernando Reyes-Rojas and David Figueroa-Rodríguez were civilians.
According to court documents, Reyes asked POPR Sergeant Fernandez and Officers Lopez and Ramos to participate in a robbery of a civilian. The officers agreed amongst themselves to participate. They further agreed that Officer Ramos would invite his cousin, Figueroa, to join them, and Officer Lopez would contact Officer Mir to borrow a marked patrol car to facilitate the planned robbery.
On July 14, 2012, Sergeant Fernandez, Officer Lopez, Officer Ramos and Figueroa went to the airport where they picked up a marked patrol car from Officer Mir. They drove the patrol car to meet Reyes and then went together to the location of the robbery. Sergeant Fernandez, Officer Lopez and Officer Ramos were dressed in dark colored, tactical police gear and armed with their POPR issued handguns. Figueroa and Reyes were also dressed in dark colored clothing, and Reyes appeared to have a handgun as well.
Upon entering the house through the garage, one or more of the officers identified themselves as police and falsely claimed they were executing a search warrant. They ordered several individuals in the garage to stand facing the wall and searched them for weapons. While Figueroa watched the occupants, Sergeant Fernandez, Officer Lopez, Officer Ramos and Reyes searched the property. They ultimately went to a shed in the backyard, where Reyes found cocaine and exclaimed, “Bingo!” At that point, they all departed in their respective vehicles. A few days later, Reyes met with Lopez and gave him money, which Reyes explained was a portion of the proceeds from the sale of the cocaine he took on the day of the robbery. Officer Lopez split the money with Sergeant Fernandez and Officer Ramos.
According to the indictment, Officer Mir was interviewed by Special Agents of the FBI and lied. Officer Mir falsely claimed that he did not recognize a photograph of Officer Lopez; that he had not met with Officer Lopez in more than six months; and that he did not provide the patrol car that was used to commit the July 2012 robbery.
An indictment is merely an allegation, and a defendant is presumed innocent until proven guilty beyond a reasonable doubt.
This case is being investigated by the FBI’s San Juan Division. The case is being prosecuted by Trial Attorneys Heidi Boutros Gesch and Marquest J. Meeks of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney Mariana Bauza of the District of Puerto Rico.Four patient recruiters pleaded guilty in connection with a $20 million health care fraud scheme involving Trust Care Health Services Inc. (Trust Care), a defunct home health care companyRead the Press Release
Jose Rodrigo Arechiga-Gamboa, also known as “Chino Antrax,” was formally extradited to the United States by the Netherlands today.
Arechiga-Gamboa arrived at San Diego International airport about 2 p.m. under heavy security. He was flown in by the United States Marshals Service and the Drug Enforcement Administration from Amsterdam to San Diego. He was booked into federal custody and is scheduled to be arraigned on Friday, July 11, 2014, at 2:00 p.m. before U.S. Magistrate Judge Mitchell D. Dembin.
A federal grand jury in San Diego returned an indictment on December 20, 2013, charging Arechiga-Gamboa with Conspiracy to Distribute Controlled Substances Intended for Importation and Conspiracy to Import Controlled Substances. That same day, the Clerk of the Court issued a sealed warrant for his arrest.
Arechiga-Gamboa was arrested on December 30, 2013, at the Schiphol Airport in Amsterdam, Netherlands at the request of the United States. Arechiga-Gamboa was taken into custody at the airport traveling under a fraudulent name, “Norberto Sicairos-Garcia,” as he deplaned a KLM flight from Mexico City, Mexico to Amsterdam. The United States made formal requests for assistance from foreign authorities via a provisional arrest warrant and an Interpol Red Notice. The indictment was unsealed in San Diego a few days later, on January 3, 2014.
According to formal documents filed in support of Arechiga-Gamboa’s extradition from the Netherlands, Arechiga-Gamboa is alleged to have worked for the Sinaloa Cartel as a bodyguard and the leader of an enforcement group called “Los Antrax.” In this position, he allegedly assisted the Sinaloa Cartel by providing security for narcotics shipments and conducting enforcement operations.
According to extradition documents, Arechiga-Gamboa later rose to become one of the highest-level leaders of the Sinaloa Cartel. Despite traveling under a fraudulent Mexican passport by assuming the identity of a deceased individual, undergoing significant plastic surgery and attempting to alter his fingerprints, U.S. law enforcement officials were able to confirm Arechiga-Gamboa’s identity through forensic techniques. A Dutch Court considered the extradition request and, on May 28, 2014, ordered that Arechiga-Gamboa be extradited to the United States to stand trial on the narcotics trafficking offenses.
The Justice Department’s Criminal Division Office of International Affairs provided substantial assistance in the extradition of the defendant.
Investigating agencies include the U.S. Drug Enforcement Administration, Customs and Border Protection Office of Field Operations, Customs and Border Protection Office of Border Patrol, San Diego Law Enforcement Coordination Center, Homeland Security Investigations, Internal Revenue Service, and Interpol.Four Patient Recruiters Plead Guilty in Miami for Roles in $20 Million Health Care Fraud SchemeRead the Press Release
Four patient recruiters pleaded guilty in connection with a $20 million health care fraud scheme involving Trust Care Health Services Inc. (Trust Care), a defunct home health care company.
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.
At a hearing today before U.S. District Judge Darrin P. Gayles of the Southern District of Florida, Estrella Perez, 57, and Solchys Perez, 34, both pleaded guilty to conspiracy to commit health care fraud, and Abigail Aguila, 40, pleaded guilty to conspiracy to defraud the United States and receive health care kickbacks. Sentencing for all three defendants is set for Sept. 18, 2014 in front of Judge Gayles. On June 17, 2014, another co-defendant, Monica Macias, 52, pleaded guilty to conspiracy to defraud the United States and receive health care kickbacks before U.S. Magistrate Judge Chris M. McAliley of the Southern District of Florida. Sentencing for Macias is set for Sept. 10, 2014 before Judge Gayles.
According to court documents, the defendants worked as patient recruiters for the owners and operators of Trust Care, a Miami home health care agency that purported to provide home health and physical therapy services to Medicare beneficiaries. Trust Care was operated 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.
The defendants recruited patients for Trust Care and solicited and received kickbacks and bribes from the owners and operators of Trust Care in return for allowing the agency to bill the Medicare program on behalf of the recruited Medicare patients. These Medicare beneficiaries were billed for home health care and therapy services that were not medically necessary and/or were not provided.
Estrella Perez and Solchys Perez also paid kickbacks and bribes to co-conspirators in doctors’ offices and clinics in exchange for providing home health and therapy prescriptions, plans of care, and medical certifications for their recruited patients. Co-conspirators at Trust Care then used these prescriptions, plans of care and medical certifications to fraudulently bill the Medicare program for home health care services.
From approximately March 2007 through at least January 2010, Trust Care submitted more than $20 million in claims for home health services. Medicare paid Trust Care more than $15 million for these fraudulent claims.
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 .Readout of Deputy Attorney General’s Tour of Border Station in McAllen, TexasRead the Press Release
Deputy Attorney General James Cole made a return trip today to the U.S. Customs and Border Protection’s McAllen Station and processing facility to discuss steps the Department of Justice is taking to help address the influx of migrants crossing the southwest border.
Chief Patrol Agent Kevin Oaks and Deputy Chief Patrol Agent Raul Ortiz gave the Deputy Attorney General a tour of the facility and a briefing on the operations at McAllen. McAllen staff discussed the numbers of migrants that are arriving each day, including the numbers of unaccompanied children, families and adults; and the reasons, including violence in Central American countries, that many are giving for making the dangerous trek to the U.S. border. Cole also viewed the station’s processing facility, where migrants who have arrived in the past few days are housed.
During his talk with McAllen staff, Cole took the opportunity to highlight the Justice Department’s commitment to prioritizing adjudication of cases that fall into the following four groups: unaccompanied children who recently crossed the border; families who recently crossed the border and are held in detention; families who recently crossed the border but are on “alternatives to detention;” and other detained cases, including border crossers and significant public safety threats. He also emphasized that the department’s intention to reassign immigration judges in immigration courts around the country from their current dockets to hear the cases of individuals falling in these four groups.
Cole noted that the department is also seeking new funding for as many as 40 more immigration judges and to provide technical assistance to Central American countries in identifying and dismantling smuggling operations that take advantage of migrants seeking to enter the U.S. He also noted that the department has requested funding to provide technical assistance in combating transnational crime and the threat posed by criminal gangs. Cole reiterated that the department continues to focus on investigating and prosecuting smugglers who exploit and victimize vulnerable migrants, including children, in partnership with DHS and foreign governments. The discussion with McAllen staff also included a productive exchange of ideas on strategic ways to combat smuggling.
The Deputy Attorney General was impressed by the professionalism and dedication of the McAllen staff and thanked them for their service. Cole last visited the facility in November 2013.
Los Departamentos de Justicia y de Educación Realizan un Acuerdo Conciliatorio con el Sistema de Escuelas Públicas de la Parroquia Jefferson para Garantizar el Acceso Igualitario y la Ausencia de Discriminac...Read the Press Release
WASHINGTON – Los Departamentos de Justicia y de Educación anunciaron hoy que han realizado un acuerdo amplio con el Sistema de Escuelas Públicas de la Parroquia Jefferson en Louisiana [Jefferson Parish Public School System (JPPSS)] para garantizar que todos los estudiantes puedan matricularse en las escuelas, independientemente del origen nacional o el estado inmigratorio propios o de sus padres o tutores. El acuerdo también resuelve quejas acerca de las políticas y pràcticas del JPPSS de comunicación con los padres con conocimientos limitados del idioma inglés [Limited English Proficiency (LEP)] y la respuesta del JPPSS al presunto acoso de estudiantes hispanos debido a su origen nacional.
“Este acuerdo garantizarà que en la Parroquia de Jefferson, las puertas de las escuelas y a las oportunidades estén abiertas a todos los niños, independientemente de su procedencia”, señaló la Secretaria de Justicia Auxiliar Interina Jocelyn Samuels de la División de Derechos Civiles del Departamento de Justicia. “Felicitamos al distrito escolar por su cooperación para resolver este asunto y por su compromiso de asegurarse de que sus escuelas acojan y sean accesibles a todos los estudiantes y padres”.
“Aplaudimos a la Parroquia de Jefferson por asegurar que todos los estudiantes tengan acceso a sus escuelas públicas y que todos los padres, independientemente del idioma que hablen, cuenten con la información necesaria para que sus hijos puedan participar en y aprovechar plenamente sus programas educativos”, señaló la Secretaria Auxiliar Catherine E. Lhamon de la Oficina de Derechos Civiles del Departamento de Educación. “Nos complacerà trabajar con el Departamento de Justicia y el distrito escolar en resolver estos temas cruciales asociados a los derechos civiles”.
Específicamente, bajo los términos de un acuerdo voluntario de tres años de duración, el JPPSS:
- realizarà una revisión de materiales y políticas de matriculación antes del inicio del año escolar 2014-2015 para asegurarse de no excluir o desalentar a estudiantes en lo que se refiere a su matriculación debido a su ciudadanía o situación inmigratoria;
- se asegurarà de que no se les pida a padres y alumnos que presenten un número de seguro social, una tarjeta de seguro social, un documento de identidad emitido por el estado u otro documento que requiera prueba de ciudadanía o estado inmigratorio para inscribirse o graduarse;
- capacitarà anualmente a todos los empleados responsables de la matriculación e inscripción de alumnos en las políticas revisadas;
- implementarà una política de traducción e interpretación para garantizar que los padres LEP reciban información esencial en un idioma que comprendan;
- capacitarà anualmente a todo el personal del JPPSS que interactúe con el público respecto de la comunicación efectiva con padres LEP y los tipos de información que deben ser objeto de traducción o interpretación;
- crearà un comité asesor de padres bilingüe para que realice recomendaciones al JPPSS acerca del programa educativo para aprendices del idioma inglés, políticas de matriculación e inscripción, acoso e intimidación y comunicaciones con padres LEP;
- revisarà sus políticas y pràcticas actuales para garantizar que todas las quejas de discriminación debido a raza, color u origen nacional, incluidos alegatos de acoso por los mismos motivos, se investiguen y resuelvan adecuadamente;
- brindarà capacitación sobre la diversidad, contra el acoso y contra la intimidación para docentes, personal y alumnos de la Escuela Secundaria West Jefferson,donde se produjeron los supuestos hechos de acoso e intimidación; y
- realizarà anualmente una encuesta de ambiente escolar en la Escuela Secundaria West Jefferson para evaluar la presencia de acoso e intimidación debido a origen nacional, raza y/o color.
Los departamentos controlaràn diligentemente la implementación del acuerdo para garantizar una implementación efectiva y en tiempo hàbil, así como la igualdad de oportunidades para todos los alumnos respecto de la participación en los programas educativos de JPPSS.
El 8 de mayo de 2014, los departamentos divulgaron documentos de orientación recién revisados, en los que se recordó a todos los distritos escolares su obligación bajo la ley federal de brindar oportunidades educativas igualitarias a todos los niños residentes en sus distritos, independientemente de su raza, color, origen nacional, ciudadanía o estado inmigratorio o el estado de sus padres. Se encuentra una copia de la carta en el portal del Departamento de Educación.
El hacer valer el Título VI de la Ley de Derechos Civiles de 1964, el que prohíbe la discriminación debido a raza, color u origen nacional por destinatarios de asistencia financiera federal, es una de las principales prioridades de ambos departamentos. El Departamento de Justicia también hace valer el Título IV de la Ley de Derechos Civiles de 1964, el que prohíbe la discriminación debido a raza, color, origen nacional, sexo y religión en escuelas públicas, y la Ley de Igualdad de Oportunidades Educativas de 1974, la que exige que las escuelas tomen las medidas necesarias para superar las barreras idiomàticas que impiden la participación igualitaria en programas educativos por parte de los estudiantes.
Se encuentra en el portal del Departamento de Educación una versión firmada del acuerdo en formato PDF en inglés y español.
La misión de la Oficina de Derechos Civiles [Office for Civil Rights (OCR)] del Departamento de Educación es garantizar el acceso igualitario a la educación y promover la excelencia educativa en toda la nación haciendo valer enérgicamente los derechos civiles. La OCR es responsable de hacer valer las leyes federales de derechos civiles que prohíben la discriminación por instituciones educativas debido a discapacidad, raza, color, origen nacional, sexo y edad, así como la Ley de Acceso Igualitario a los Boy Scouts of America de 2001. Se encuentra información adicional sobre la oficina en este portal.
Existe información adicional disponible sobre la Sección de Oportunidades Educativas de la División de Derechos Civiles del Departamento de Justicia en el portal de la sección.
- realizarà una revisión de materiales y políticas de matriculación antes del inicio del año escolar 2014-2015 para asegurarse de no excluir o desalentar a estudiantes en lo que se refiere a su matriculación debido a su ciudadanía o situación inmigratoria;
Justice Department, Health and Human Services Call for Action to Address Abuse of Older AmericansRead the Press Release
WASHINGTON –Today, leaders in the fight against elder abuse announced a framework for tackling the highest priority challenges to elder abuse prevention and prosecution, and called on all Americans to take a stand against the serious societal problem of elder abuse, neglect and financial exploitation.
Research suggests that one in 10 Americans over the age of 60 has experienced elder abuse or neglect, and that people with dementia are at higher risk for abuse.
Supported by the Department of Justice (DOJ) and the Department of Health and Human Services (HHS), the Elder Justice Roadmap was developed by harnessing the expertise and gathering the input of hundreds of public and private stakeholders from across the country. The goal of these expert summits was to identify the most critical priorities and concrete opportunities for greater public and private investment and engagement in elder abuse issues. The Elder Justice Roadmap, which is being published today, reflects the knowledge and perspectives of these experts in the field and will be considered by the Elder Justice Coordinating Council and others in developing their own strategic plans to prevent and combat elder abuse.
“The Roadmap Project is an important milestone for elder justice,” said Associate Attorney General Tony West. “Elder abuse is a problem that has gone on too long, but the Roadmap Report released today can change this trajectory by offering comprehensive and concrete action items for all of the stakeholders dedicated to combating the multi-faceted dimensions of elder abuse and financial exploitation. While we have taken some important steps in the right direction, we must do more to prevent elder abuse from occurring in the first place and face it head on when it occurs.”
“From now until 2030, every day, about 10,000 baby boomers will celebrate their 65th birthday,” said Kathy Greenlee, HHS’ assistant secretary for aging and administrator of the Administration for Community Living. “And the fastest-growing population is people 85 years old, or older. Stemming the tide of abuse will require individuals, neighbors, communities, and public and private entities to take a hard look at how each of us encounters elder abuse—and commit to combat it.”
To support the mission of elder abuse prevention and prosecution, DOJ has developed an interactive, online curriculum to teach legal aid and other civil attorneys to identify and respond to elder abuse. The first three modules of the training cover what lawyers should know about elder abuse; practical and ethical strategies to use when facing challenges in this area; and a primer on domestic violence and sexual assault. This training will expand to include six one-hour modules covering issues relevant to attorneys who may encounter elder abuse victims in the course of their practice.
HHS is supporting the mission by developing a voluntary national adult protective services (APS) data system. Collecting national data on adult mistreatment will help to identify and address many gaps about the number and characteristics of adults who are the victims of maltreatment and the nature of services that are provided by APS agencies to protect these vulnerable adults. In addition, the data will better inform the development of improved, more targeted policy and programmatic interventions.
In addition to informing federal elder justice efforts, the roadmap has already inspired private stakeholders to take action. For example, as a result of the roadmap, the Archstone Foundation has funded a project at the Keck School of Medicine at the University of Southern California to develop a national training initiative, while other funders, such as the Weinberg Foundation, have begun to consider inquiries and projects outlined in the roadmap. Likewise, the Brookdale Center for Healthy Aging at Hunter College, The Harry and Jeannette Weinberg Center for Elder Abuse Prevention at the Hebrew Home at Riverdale and the New York City Elder Abuse Center will be co-sponsoring a symposium in September 2014 focusing on innovations and challenges related to elder abuse multidisciplinary teams, a priority area identified in the roadmap.
“While federal and state governments certainly have critical roles to play, the battle against elder abuse can only be won with grassroots action at the community and individual level,” said Greenlee. “Turning the tide against elder abuse requires much greater public commitment, so every American will recognize elder abuse when they see it and know what to do if they encounter it.”
Two steps local communities, families and individuals can take are:
• Learn the signs of elder abuse. The National Center on Elder Abuse, a program of the Administration on Aging at ACL, has developed a helpful Red Flags of Abuse Factsheet (PDF) that lists the signs of and risk factors for abuse and neglect.
• Report suspected abuse when you see it. Contact your local adult protective services agency. Phone numbers for state or local offices can be found at the National Center for Elder Abuse website, or call 1-800-677-1116.
“We must take a stand to ensure that older Americans are safe from harm and neglect,” said Associate Attorney General West. “For their contributions to our nation, to our society, and to our lives, we owe them nothing less.”
The Elder Justice Roadmap and accompanying materials are at: http://ncea.acl.gov/Library/Gov_Report/index.aspx.
Free online training for attorneys is at: https://www.ovcttac.gov/views/dspLegalAssistance.cfm?tab=1#onlinetraining.
Justice Department Reaches Settlement with the City of Hubbard, OregonRead the Press Release
The Justice Department announced today that it reached a settlement with the city of Hubbard, Oregon, resolving an investigation of the city under Title I of the Americans with Disabilities Act (ADA). The investigation found that the city’s online employment application asked questions about disabilities in violation of the ADA. The ADA does not permit employers to inquire whether an applicant is an individual with a disability or as to the nature of such disability before making a conditional offer of employment. However, the ADA permits federal contractors subject to affirmative action requirements under Section 503 of the Rehabilitation Act of 1973 to invite an applicant voluntarily to self-identify as an individual with a disability, consistent with certain requirements. Last month, the department reached a similar settlement agreement with Florida State University.
Under the settlement, the city agrees to ensure that its hiring policies do not discriminate against any applicant on the basis of disability, including by:
· not conducting a medical examination or making a disability-related inquiry of a job applicant before a conditional offer of employment is made;
· not requiring a medical examination or making inquiries of an employee as to whether such employee is an individual with a disability, or as to the nature or severity of the disability, unless such examination or inquiry is shown to be job-related and consistent with business necessity;
· maintaining the medical or disability-related information of applicants and employees in separate, confidential medical files; and
· training employees who make hiring or personnel decisions on the requirements of the ADA, designating an individual to address ADA compliance matters and reporting on compliance.
“This agreement ensures that people with disabilities will have an equal chance to compete for jobs with the city of Hubbard,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division. “The Justice Department is committed to eliminating employment barriers for people with disabilities, and we commend the city of Hubbard for its cooperation and efforts to ensure fairness in the job application process.”
Those interested in finding out more about the ADA may call the department’s toll-free ADA information line at 800-514-0301 (TDD 800-514-0383) or visit the ADA website.
Georgia Police Officials and Former Deputy Indicted by Federal Grand Jury on Charges of Excessive Force and Obstruction of JusticeRead the Press Release
The Department of Justice announced today that a federal grand jury in the U.S. District Court for the Middle District of Georgia returned indictments charging four law enforcement officers with civil rights violations and obstruction of justice in connection with an incident that occurred at Bainbridge BikeFest in 2012. A seven count indictment was returned charging former Grady County Sheriff’s Deputy Wiley Griffin IV and Decatur County Sheriff’s Office Captain Elizabeth Croley with violating an individual’s civil rights. Additionally, Croley, Decatur County Sheriff’s Deputy Christopher Kines and former Decatur County Sheriff’s Deputy Robert Wade Umbach were charged with obstructive conduct relating to the investigation into the civil rights violation.
The indictment charges that Griffin used excessive force during the arrest of a civilian, A.P., at the Bainbridge BikeFest motorcycle event in Bainbridge, Georgia, on Sept. 15 to 16, 2012, thereby violating A.P.’s civil rights. As a result of the assault, A.P. sustained injuries to his face, including cuts, bleeding, swelling and bruising.
The indictment also charges Croley, Kines and Umbach with writing false reports to cover up the assault. In addition, Kines and Umbach were charged with making misleading statements to the FBI to obstruct the agency’s investigation into the use of force against A.P.
In addition, the indictment charges Croley with violating A.P.’s constitutional right to a fair trial by intentionally withholding material exculpatory evidence from the District Attorney’s office, and, in turn, from A.P.’s criminal defense attorney, during prosecution of A.P. arising from the arrest at BikeFest.
The civil rights charge against Griffin carries a statutory maximum sentence of 10 years in prison. The civil rights charge against Croley carries a statutory maximum sentence of one year in prison. Additionally, Croley, Kines and Umbach face a statutory maximum sentence of 20 years in prison for their falsification of reports, and Umbach and Kines face a statutory maximum sentence of 20 years in prison for making misleading statements to obstruct justice.
This case is being investigated by the FBI and is being prosecuted by Trial Attorneys Christine M. Siscaretti and Risa Berkower of the Justice Department’s Civil Rights Division, with support from the U.S. Attorney’s Office for the Middle District of Georgia.
An indictment is a formal accusation of criminal conduct, not evidence of guilt. The defendants are presumed innocent unless and until proven guilty.
District Court Enters Permanent Injunction Against Joint King 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 Triceutical Inc. and its president, Liqun Zhang, of Farmingdale, New York, to prevent the distribution of adulterated dietary supplements.
According to a complaint filed last month, 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 Triceutical’s manufacturing facility in Farmingdale, which revealed, among other things, that Triceutical failed to ensure that components, dietary supplements, packaging and labels were not mixed up, contaminated or deteriorated.
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 the defendants wish to resume manufacturing dietary supplements in the future, the FDA first must determine that Triceutical’s manufacturing practices have come into compliance with the law. The consent decree was filed with the complaint in June and docketed yesterday.
Triceutical was the manufacturer of Joint King dietary supplement, which was found to contain high levels of Vitamin D. A consumer of Joint King experienced headache, confusion and kidney failure resulting in hospitalization due to Vitamin D toxicity.
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, filed this case on behalf of the United States.
Departments of Justice and Education Reach Settlement Agreement with Jefferson Parish Public School System Ensuring Equal Access and Non-Discrimination in SchoolsRead the Press Release
The Departments of Justice and Education announced today that they have reached a comprehensive agreement with the Jefferson Parish Public School System in Louisiana (JPPSS) to ensure that all students can enroll in school regardless of their own national origin or immigration status, or that of their parents or guardians. The agreement also resolves complaints regarding JPPSS’ policies and practices for communicating with parents who have limited English proficiency (LEP) and JPPSS’ response to alleged harassment of Latino students based on their national origin.
“This agreement will ensure that in Jefferson Parish, the doors to school and to opportunity will be open to all children, regardless of background,” said Acting Assistant Attorney General Jocelyn Samuels for the Justice Department’s Civil Rights Division. “We commend the school district for working collaboratively to resolve this matter and for its commitment to making sure that its schools are welcoming and accessible to all students and parents.”
“We applaud Jefferson Parish for ensuring that all students will have access to their public schools and that all parents, regardless of the language they speak, are equipped with the information necessary for their children to fully participate in and benefit from their educational programs,” said Assistant Secretary Catherine E. Lhamon for the Department of Education’s Office for Civil Rights. “We look forward to working with the Department of Justice and the school district to address these crucial civil rights issues.”
Specifically, under the terms of the three-year voluntary agreement, JPPSS will:
· revise enrollment and registration materials and policies before the beginning of the 2014-2015 school year to ensure they do not exclude or discourage students from enrolling based on citizenship or immigration status;
· ensure that parents and students are not asked to produce a social security number, social security card, state-issued identity document or other document that requires proof of citizenship or immigration status in order to enroll or graduate;
· annually train all employees responsible for student enrollment and registration on the revised policies;
· implement a translation and interpretation policy to ensure that LEP parents receive essential information in a language they understand;
· annually train all JPPSS personnel who interact with the public regarding effective communication with LEP parents and what types of information must be translated or interpreted;
· create a bilingual parent advisory committee to make recommendations to JPPSS regarding the educational program for English language learners, registration and enrollment policies, harassment and bullying and communications with LEP parents;
· revise its current policy and practices to ensure that all complaints of discrimination on the basis of race, color or national origin, including allegations of harassment on these bases, are appropriately investigated and resolved;
· provide anti-harassment, anti-bullying and diversity training for the faculty, staff and students of West Jefferson High School, where the alleged harassment and bullying occurred; and
· annually administer a school climate survey at West Jefferson High School to assess the presence of harassment and bullying on the basis of national origin, race and/or color.
The departments will closely monitor the implementation of the agreement to ensure timely and effective implementation and equal opportunity for all students to participate in JPPSS’ educational programs.
On May 8, 2014, the departments released newly-revised guidance documents reminding all school districts of their obligation under federal law to provide equal educational opportunities to all children residing in their districts, regardless of race, color, national origin, citizenship or immigration status or the status of their parents. A copy of the letter can be found on the Department of Education website.
The enforcement of Title VI of the Civil Rights Act of 1964, which prohibits discrimination on the basis of race, color or national origin by recipients of federal financial assistance, is a top priority of both departments. The Justice Department also enforces Title IV of the Civil Rights Act of 1964, which prohibits discrimination on the basis of race, color, national origin, sex and religion in public schools, and the Equal Educational Opportunities Act of 1974, which requires schools to take appropriate action to overcome language barriers that impede students’ equal participation in instructional programs.
A signed, PDF version of the agreement can be found online in both English and Spanish
The mission of the Office for Civil Rights (OCR) in the Department of Education is to ensure equal access to education and promote educational excellence throughout the nation through the vigorous enforcement of civil rights. OCR is responsible for enforcing federal civil rights laws that prohibit discrimination by educational institutions on the basis of disability, race, color, national origin, sex and age, as well as the Boy Scouts of America Equal Access Act of 2001. Additional information about the office is available at this website
Additional information about the Justice Department’s Civil Rights Division, Educational Opportunities Section, is available at the section's website
Department of Justice Announces New Priorities to Address Surge of Migrants Crossing into the U.S.Read the Press Release
Deputy Attorney General James Cole announced today that the Justice Department will implement a series of steps to help address the influx of migrants crossing the southern border of the United States. These include refocusing immigration court resources to adjudicate the cases of recent migrants; providing support and training to help address violence in Central America; and redoubling efforts to work with other federal agencies and the Mexican government to investigate and prosecute those who smuggle migrants to the United States.
“Individuals who embark on the perilous journey from Central America to the United States are subject to violent crime, abuse, and extortion as they rely on dangerous human smuggling networks to transport them through Central America and Mexico,” Deputy Attorney General Cole said. “We have an obligation to provide humanitarian care for children and adults with children who are apprehended on our borders, but we also must do whatever we can to stem the tide of this dangerous migration pattern. The efforts we are announcing today are intended to address the challenges of this influx in a humane, efficient and timely way.”
Cole announced that the department’s Executive Office for Immigration Review (EOIR) will refocus its resources to prioritize cases involving migrants who have recently crossed the southwest border and whom DHS has placed into removal proceedings -- so that these cases are processed both quickly and fairly to enable prompt removal in appropriate cases, while ensuring the protection of asylum seekers and others.
“This refocusing of resources will allow EOIR to prioritize the adjudication of the cases of those individuals involved in the evolving situation at the southwest border,” said EOIR Director Juan P. Osuna. “Although our case management priorities are shifting, our immigration judges will continue to evaluate and rule upon cases consistent with all substantive and procedural rights and safeguards applicable to immigration proceedings.”
To augment its capacity to adjudicate cases as promptly as possible, EOIR is committed to hiring more immigration judges. EOIR this week will also publish a regulation allowing for the appointment of temporary immigration judges. Further, EOIR plans both to expand its existing legal access programs, and enhance access to legal resources and assistance for persons in removal proceedings.
Cole also announced that the Department is seeking new funding, as a part of the President’s emergency supplemental appropriations request, to assist Central American countries in combatting transnational crime and the threat posed by criminal gangs. This regional strategy for law enforcement capacity building would be aimed at addressing the issues that have been a factor in forcing many migrants to flee Central America for the United States.
The department will also redouble its efforts to work with Mexican authorities to identify and apprehend smugglers who are aiding unaccompanied children in crossing the U.S. border. Later this week, the Deputy Attorney General will also be meeting with the five U.S. Attorneys who represent the southwest border districts to strategize on ways to disrupt and dismantle criminal organizations on the border that are facilitating the transportation of unaccompanied minors and others.
Today, Deputy Attorney General Cole will go to the U.S. Customs and Border Protection’s McAllen Station and processing facility to see the urgent situation at the border. EOIR Director Osuna will be testifying before the Senate Homeland Security and Governmental Affairs Committee to highlight the Justice Department’s efforts to aid in the administration-wide response to the migrant influx.
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Fact Sheet
Chicago Businessman Pleads Guilty to Failing to File Tax ReturnsRead the Press Release
Jaime Viteri, a Chicago businessman, pleaded guilty to two counts of willfully failing to file federal individual income tax returns today, announced the Justice Department and the Internal Revenue Service (IRS).
On June 12, a criminal information was filed in the U.S. District Court for the Northern District of Illinois that alleged Viteri had willfully failed to file individual income tax returns for tax years 2007, 2008 and 2009. According to the plea agreement filed with the district court, Viteri earned and received gross income from his work as the president and chief executive officer of Viteri Inc., doing business as Chicago Latino Network (CLN), a solely owned media company focused on the Latino community in Chicago. Viteri was also an employee and managing director of the Bureau of Entrepreneurship and Small Business at the Department of Commerce and Economic Opportunity, an Illinois state government agency.
Viteri’s gross income from his employment exceeded approximately $270,000 for the 2008 tax year and $290,000 for the 2009 tax year. During these years, Viteri was required to file individual income tax returns and report the gross income he earned. Despite earning and receiving gross income from two different sources, Viteri willfully failed to file individual income tax returns with the IRS for tax years 2008 and 2009 as required by law. Under the terms of the plea agreement, Viteri also agrees to pay restitution to the IRS.
Sentencing is scheduled for Nov. 5, 2014. Viteri faces a statutory maximum sentence of one year in prison per count, one year of supervised release per count and a maximum fine of $100,000 per count.
The case was investigated by special agents from IRS-Criminal Investigation and prosecuted by Trial Attorney Christopher Maietta of the Justice Department’s Tax Division.
Additional information about the Tax Division and its enforcement efforts may be found at the division website .
BNP Paribas Pleads Guilty to Conspiring to Violate U.S. Economic Sanctions in Manhattan Federal CourtRead the Press Release
BNP Paribas S.A. (BNPP), a global financial institution headquartered in Paris, pleaded guilty today before U.S. District Judge Lorna G. Schofield in the Southern District of New York to a one-count information charging the bank with conspiring to violate the International Emergency Economic Powers Act (IEEPA) and the Trading with the Enemy Act (TWEA), for its role in processing billions of dollars of U.S. dollar transactions through the U.S. financial system on behalf of Sudanese, Iranian, and Cuban entities subject to U.S. economic sanctions from 2004 through 2012.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Preet Bharara for the Southern District of New York made the announcement.
In accepting BNPP’s guilty plea, the court accepted the plea agreement that had been entered into by the government and BNPP on June 30, 2014, under which BNPP agreed to forfeit a total of $8.8336 billion, pay a criminal fine of $140 million, cooperate with U.S. authorities, and be subject to a five-year term of probation, during which BNPP must enhance its compliance policies and procedures in accordance with settlement agreements BNPP has entered into with its principal U.S. regulators, the Board of Governors of the Federal Reserve System and the New York State Department of Financial Services.
According to the plea agreement, statements made during today’s plea proceeding, and the statement of facts containing further admissions by BNPP, BNPP knowingly and willfully moved more than $8.8 billion through the U.S. financial system on behalf of entities subject to U.S. embargo from 2004 through 2012, including more than $4.3 billion in transactions involving entities that were specifically designated by the U.S. government as being cut off from the U.S. financial system.
BNPP admitted that the majority of illegal payments were made on behalf of sanctioned entities in Sudan, which was subject to U.S. embargo based on the Sudanese government’s role in facilitating terrorism and committing human rights abuses. BNPP processed approximately $6.4 billion through the United States on behalf of Sudanese sanctioned entities from July 2006 through June 2007, including approximately $4 billion on behalf of a financial institution owned by the government of Sudan, even as internal emails showed BNPP employees expressing concern about the bank’s assisting the Sudanese government in light of its role in supporting international terrorism and committing human rights abuses during the same time period. Indeed, in March 2007, a senior compliance officer at BNPP wrote to other high-level BNPP compliance and legal employees reminding them that certain Sudanese banks with which BNPP dealt “play a pivotal part in the support of the Sudanese government which . . . has hosted Osama Bin Laden and refuses the United Nations intervention in Darfur.”
One way in which BNPP processed illegal transactions on behalf of Sudanese sanctioned entities was through a sophisticated system of “satellite banks” set up to disguise both BNPP’s and the sanctioned entities’ roles in the payments to and from financial institutions in the United States. As early as August 2005, a senior compliance officer at BNPP warned several legal, business, and compliance personnel at BNPP’s subsidiary in Geneva that the satellite bank system was being used to evade U.S. sanctions: “As I understand it, we have a number of Arab Banks (nine identified) on our books that only carry out clearing transactions for Sudanese banks in dollars. . . . This practice effectively means that we are circumventing the US embargo on transactions in USD by Sudan.”
Similarly, BNPP admitted that it provided Cuban sanctioned entities with access to the U.S. financial system by hiding the Cuban sanctioned entities’ involvement in payment messages. From October 2004 through early 2010, BNPP knowingly and willfully processed approximately $1.747 billion on behalf of Cuban sanctioned entities. In the statement of facts, BNPP admitted that it continued to do U.S. dollar business with Cuba long after it was clear that such business was illegal in order to preserve BNPP’s business relationships with Cuban entities. BNPP further admitted that its conduct with regard to the Cuban embargo was both “cavalier” and “criminal,” as evidenced by the bank’s 2006 decision, after certain Cuban payments were blocked when they reached the United States, to strip the wire messages for those payments of references to Cuban entities and resubmit them as a lump sum in order to conceal from U.S. regulators the bank’s longstanding, and illicit, Cuban business.
BNPP also admitted to engaging in more than $650 million of transactions involving entities tied to Iran, and this conduct continued into 2012 – nearly two years after the bank had commenced an internal investigation into its sanctions compliance and had pledged to cooperate with the government. The illicit Iranian transactions were done on behalf of BNPP clients, including a petroleum company based in Dubai that was effectively a front for an Iranian petroleum company, and an Iranian oil company.
This case was investigated by the Internal Revenue Service-Criminal Investigation’s Washington Field Division and the FBI’s New York Field Office. This case is being prosecuted by the Money Laundering and Bank Integrity Unit of the Criminal Division’s Asset Forfeiture and Money Laundering Section (AFMLS) and the Money Laundering and Asset Forfeiture Unit of the U.S. Attorney’s Office for the Southern District of New York. Trial Attorneys Craig Timm and Jennifer E. Ambuehl of AFMLS and Assistant United States Attorneys Andrew D. Goldstein, Martin S. Bell, Christine I. Magdo and Micah W.J. Smith of the Southern District of New York are in charge of the prosecution.
The New York County District Attorney’s Office also conducted its own investigation alongside the Department of Justice on this investigation. The Department of Justice expressed its gratitude to the Board of Governors of the Federal Reserve, the Federal Reserve Bank of New York, the New York State Department of Financial Services, and the Treasury Department’s Office of Foreign Assets Control for their assistance with this matter.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.
Steven Worthey, of San Antonio, 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 Lawrence Burns, aka “Chance,” of Dallas, Texas, pleaded guilty to the same charge on July 3, 2014.
According to court documents, Worthey, Burns 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. Worthey, Burns 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, Worthey and Burns 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.
Worthey and Burns are both scheduled to be sentenced on Oct. 8, 2014. Each faces a maximum penalty of life in prison.
Worthey and Burns are two of 36 defendants charged with conducting racketeering activity through the ABT criminal enterprise, among other charges. To date, 32 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.Virginia-Based Move Management Company Pays More Than $500,000 to Settle Overbilling Claims in Connection with Transportation of Personal Property in Relocating Federal EmployeesRead the Press Release
RE/MAX Allegiance Relocation Services, a Virginia-based move management company, has agreed to pay the government $509,807 to resolve allegations that it violated the False Claims Act by overbilling for transportation services, the Department of Justice announced today.
“Today’s settlement demonstrates our continuing vigilance to ensure that those doing business with the government do so legally and honestly and that taxpayer funds are not misused,” said Assistant Attorney General for the Civil Division Stuart F. Delery. “Government contractors who seek to profit at the expense of taxpayers will be held accountable.”
The settlement relates to allegations involving contracts to transport personal property of federal employees relocating duty stations within the United States and between the United States and Canada. The government alleged that the defendant charged for move management services that were not provided and overbilled agencies on other moves by charging inapplicable tariff rates.
“We encourage whistleblowers to provide us with useful information to help us combat all manners of fraud on the U.S. Government,” said U.S. Attorney for the Eastern District of Virginia Dana J. Boente.
“We will continue to investigate allegations of federal contractors fraudulently maximizing their profits at the expense of American taxpayers,” said U.S. General Services Administration Acting Inspector General Robert C. Erickson.
The settlement resolves allegations filed in a lawsuit by Michael Angel, a former employee of RE/MAX Allegiance Relocation Services, in federal court in Alexandria, Virginia. The lawsuit was filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private individuals to sue on behalf of the government for false claims and to share in any recovery. The act also allows the government to intervene and take over the action, as it did in this case. Angel will receive $86,667.
The settlement was the result of a coordinated effort by the Civil Division of the Department of Justice, the U.S. Attorney’s Office for the Eastern District of Virginia, the General Services Administration Office of Inspector General, U.S. Department of Homeland Security Office of Inspector General, Department of Agriculture Office of Inspector General and NASA Office of Inspector General.
The case is captioned United States ex rel. Michael Angel v. Franconia Real Estate Services, Inc., d/b/a RE/MAX Allegiance Relocation Services; No. 1:12cv764 (E.D.Va.). The claims resolved by the settlement are allegations only; there has been no determination of liability.
Two Alabama Men Sentenced for Stolen Identity Refund Fraud Crimes in Separate CasesRead the Press Release
Deundra Milhouse and Fredrick Hill, both residents of Alabama, were sentenced today in separate stolen identity refund fraud (SIRF) cases, announced Acting Assistant Attorney General Tamara Ashford of the Justice Department’s Tax Division and U.S. Attorney George L. Beck Jr. for the Middle District of Alabama. Milhouse was sentenced to serve 81 months in prison and Hill was sentenced to serve 74 months in prison.
Deundra Milhouse Case
Milhouse previously pleaded guilty to one count of access device fraud, one count of aggravated identity theft and one count of being a felon in possession of a firearm. He was indicted in December 2013 and has been detained since his arrest in late January. According to his plea agreement, Milhouse was involved in SIRF crimes—using stolen identities to steal money from the Internal Revenue Service (IRS) by filing fraudulent tax returns claiming refunds in the victims’ names—from spring 2011 through late 2013. In 2011 and 2012, Milhouse received more than $80,000 in fraudulently obtained tax refunds into a bank account he controlled. By 2013, he switched to using prepaid debit cards to receive the refunds.
Milhouse admitted in his plea agreement that he was driving a car that was stopped on Oct. 8, 2013, in Elmore County, Alabama. He managed to flee on foot and threw away a handgun that he had been carrying. At that time, Milhouse was a convicted felon prohibited from having a firearm. Numerous prepaid debit cards and documents with personal identifying information were found in the car he was driving. Milhouse also admitted that a later search of his house uncovered many more documents with the personal identifying information of victims, as well as more than 200 prepaid debit cards, a computer used to file tax returns and a magazine and ammunition for the discarded handgun. As part of his plea, Milhouse stipulated that his conduct involved an attempted fraud loss of more than $400,000 to more than 250 victims and that he had a least one felony conviction for a crime of violence prior to his possession of the handgun.
Fredrick Hill Case
Hill previously pleaded guilty to access device fraud and aggravated identity theft. According to his plea agreement, Hill sold stolen identities to others to be used in SIRF crimes. Hill admitted that at one point he possessed dozens of prepaid debit cards and more than 300 stolen identities in connection with his involvement in SIRF crime.
Both cases were investigated by special agents of IRS - Criminal Investigation. The Elmore County Sheriff’s Office also provided assistance in the Milhouse case. Trial Attorneys Jason Poole and Michael Boteler of the department's Tax Division prosecuted the Milhouse case and Trial Attorneys Jason Poole and Gregory Bailey prosecuted the Hill case. Assistant U.S. Attorney Todd Brown and the U.S. Attorney’s Office for the Middle District of Alabama assisted with both cases.
Additional information about the Tax Division and its enforcement efforts may be found at the division website .
Russian Hacker Wanted in Seattle, Washington Arrested in GuamRead the Press Release
ROMAN SELEZNEV, a Russian national indicted in the Western District of Washington for a computer hacking scheme that compromised the financial accounts of credit card customers, was arrested in Guam on July 6, 2014 by law enforcement agents from the U.S. Secret Service.
SELEZNEV was indicted in March 2011 for multiple counts of Bank Fraud, Intentional Damage to a Protected Computer, Obtaining Information from a Protected Computer, Possession of Fifteen or More Unauthorized Access Devices, Trafficking in Unauthorized Access Devices, and Aggravated Identity Theft related to a computer hacking scheme that occurred between October 2009 to February 2011 within the Western District of Washington and elsewhere. The superseding indictment from the Western District of Washington details, among other things, a bank fraud scheme in which SELEZNEV is charged with hacking into retail point of sale systems and installing malicious software on the systems to steal credit card numbers. The indictment further alleges that SELEZNEV created and used infrastructure to further the theft and sales of credit card data, and used servers worldwide to facilitate the operation.
SELEZNEV appeared before the Honorable Joaquin V.E. Manibusan, Magistrate Judge of the U.S. District Court of Guam, on July 7, 2014 for his initial appearance, and was remanded to the custody of the U.S. Marshals Service pending a further hearing set for July 22, 2014.Alicia A.G. Limtiaco stated, “The United States Attorney’s Office for the Districts of Guam and the Northern Mariana Islands is committed to working with our law enforcement partners and community of United States Attorney’s Offices, to combat against cybercrime, data theft and financial crimes, and to hold offenders accountable and ensure that they are brought to justice.”
The charges contained in the indictment are only allegations. A person is presumed innocent unless and until he or she is proven guilty beyond a reasonable doubt in a court of law.
Reneelinette P. Mesa and Ok Ja Cho Sentenced Today in the District Court of GuamRead the Press Release
ALICIA A.G. LIMTIACO, United States Attorney for the Districts of Guam and the Northern Mariana Islands, announced that Defendants RENEELINETTE P. MESA, age 33, and OK JA CHO, age 47, were sentenced today in the District Court of Guam by Judge Ramona Manglona, for their roles in making and passing counterfeit currency on Guam.
Defendant MESA was sentenced for the offense of Making Photographs in the Likeness of U.S. Currency. Defendant CHO was sentenced for Dealing in Counterfeit U.S. Obligations and Securities. Defendant MESA and co-defendant Michael Badar (who will be sentenced later) made counterfeit currency and passed them at various businesses throughout Guam. They were discovered when a vendor at Micronesian Mall called Mall Security when Defendant CHO attempted to pass one of the counterfeit notes. The vendor led the Mall Security Officers to CHO. Mall Security detained CHO until the Guam Police Department (GPD) and the U.S. Secret Service (USSS) responded. Defendant CHO confessed that day and led United States Secret Service to Badar and Defendant MESA. Agents recovered the materials they used to produce the counterfeit currency in garbage bags to be thrown out.
Defendant MESA was sentenced to 14 months imprisonment, five years supervised release, and 125 hours community service. Defendant MESA was also ordered to pay restitution to the victims who filed claims. Defendant CHO was sentenced to time served, with credit for seven months and eight days, three years supervised release, 200 hours community service and was ordered to report her conviction to the U.S. Department of Homeland Security, U.S. Citizenship & Immigration Services.
Credit for the investigation is given to the Micronesian Mall Security, officers of the Guam Police Department, and special agents of the U.S. Secret Service. The case was handled by Assistant U.S. Attorney Clyde Lemons.Medical Device Inventor Sentenced to Prison for Tax FraudRead the Press Release
Ashvin Desai, of San Jose, California, was sentenced yesterday to serve six months in prison and six months and one day of home confinement for concealing more than $8 million in foreign bank accounts, the Justice Department and Internal Revenue Service (IRS) announced. Prior to yesterday’s sentencing hearing, Desai filed with the court a document indicating that the IRS has assessed and demanded payment of a Reports of Foreign Bank and Financial Accounts (FBAR) penalty against him for $14,229,744.
In October 2013, a jury convicted Desai, a medical device manufacturer, of failing to report his family’s foreign bank accounts to the government on tax returns and FBARs. The jury also found that Desai failed to disclose more than $1.2 million in interest income generated by these accounts between 2007 and 2009. Desai was sentenced by U.S. District Judge Edward J. Davila.
According to the evidence presented in court, Desai controlled several foreign bank accounts at HSBC in India and Dubai, including accounts held in the name of his wife and adult children. Desai invested the funds in these accounts in certificates of deposit, which earned interest at rates as high as nine percent. Desai funded these accounts by mailing checks from the United States and by transferring money from other undeclared bank accounts in Singapore and the United Kingdom to his family’s accounts in India. Desai also sold medical devices abroad, and, on at least one occasion, directed that his customer wire funds directly to his undeclared HSBC India account.
Between 2007 and 2009, Desai paid approximately $17,000 in taxes. However, Desai owed an additional $357,783 in taxes to the IRS on his unreported interest income. Desai’s deposits into his foreign accounts also far exceeded the income he disclosed on his tax returns each year. In 2008, for example, he deposited nearly $1.1 million into foreign accounts while only reporting income of $115,810.91 on his tax return.
The evidence at trial demonstrated the steps Desai took to conceal his family’s foreign accounts from the government. In addition to failing to report his accounts on tax returns and FBARs, Desai also directed the bank not to mail bank statements to his house. On one occasion, Desai wrote an email in which he asked an HSBC banker: “Why are all the statements coming to Home address? I thought we had a different arrangement.”
This case was investigated by IRS-Criminal Investigation and prosecuted by Trial Attorney Melissa Siskind of the Tax Division.
Detroit Tax Preparer Sentenced for Failing to Report Income from Tax PreparationRead the Press Release
The Justice Department, the Internal Revenue Service (IRS) and the Treasury Inspector General for Tax Administration (TIGTA) announced that Matthew Bender, of Detroit, was sentenced today by U.S. District Judge Julian Abele Cook Jr. to serve 48 months in prison and one year of supervised release.
On March 18, after a fourday trial, a jury in the U.S. District Court for the Eastern District of Michigan convicted Bender of obstructing the IRS and of nine counts of aiding and assisting in the preparation of false federal income tax returns. On June 4, another jury convicted Bender of failing to make a required appearance in court. Today’s sentencing is for all of Bender’s convictions.
According to court documents and evidence produced at trial, between 2006 and 2011, Bender prepared more than 3,000 tax returns and earned more than $500,000 in fees. However, Bender failed to report his own income from tax preparation to the IRS, either by filing false tax returns for himself or by failing to file his own tax returns at all. The evidence also showed that Bender caused inflated tax refunds for his customers by placing false deductions on their returns.
After the initial indictment prior to his first trial, Bender was ordered by Judge Cook Jr. to appear in court July 2, 2013, concerning his failure to comply with his conditions of release. Bender failed to appear in court on that date and was arrested in August 2013 by the U.S. Marshals Service after returning to Michigan from traveling to Ohio and Texas.
The case was investigated by special agents of IRS – Criminal Investigation and TIGTA. Trial Attorneys Jeffrey McLellan and Kenneth Vert of the department’s Tax Division prosecuted the case.
Additional information about the Tax Division and its enforcement efforts may be found at the division website .