District Not Recorded
The source did not name an office we could identify. These records remain unassigned rather than guessed.
Miami Pharmacy Owner Sentenced to 14 Years in Prison<br /> in $23 Million Health Care Fraud SchemeRead the Press Release
A co-owner and operator of three Miami discount pharmacies was sentenced today to 168 months in prison for his role in a health care fraud scheme that submitted more than $23 million in false claims to Medicare.
The sentence was announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; Michael B. Steinbach, Special Agent in Charge of the FBI’s Miami Field Office; and Special Agent in Charge Christopher B. Dennis of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), Office of Investigations Miami office.
Jose Carlos Morales, 55, of Miami, was sentenced by U.S. District Judge Joan A. Lenard in the Southern District of Florida. In addition to his prison term, Morales was sentenced to serve three years of supervised release and to pay a $100,000 fine. A hearing to determine the amount of restitution Morales will pay has been scheduled for April 29, 2013.
On Dec. 6, 2012, Morales pleaded guilty in the Southern District of Florida to one count of conspiracy to commit health care fraud and one count of conspiracy to defraud the United States and pay illegal health care kickbacks.
According to court documents, Morales was the co-owner of Pharmovisa Inc. and PharmovisaMD Inc., which operated a total of three pharmacies in Miami. Morales paid illegal health care kickbacks to co-conspirators in return for a stream of beneficiary information to be used to submit claims to Medicare and Medicaid. The beneficiaries who were referred to the pharmacies in exchange for kickback payments resided at assisted living facilities (ALFs) located in Miami. Morales and his alleged co-conspirators also paid illegal health care kickbacks to physicians in exchange for prescription referrals, which the pharmacies ultimately billed to Medicare.
Court documents also reveal that beginning in approximately 2007, drivers working for Morales’ pharmacies, at his direction, delivered “bingo cards” containing pop out medications to ALFs located throughout the Southern District of Florida. Morales instructed the drivers to pick up any unused “bingo cards” so that Morales pharmacy personnel could put the medications back into pill bottles. Unused and partially used medications were eventually re-billed to Medicare and Medicaid, and a majority of the previously submitted claims to Medicare and Medicaid were never reversed. Morales also instructed Morales pharmacy personnel to place unused and partially used medications into bottles to be sold directly to the general public from the “community” pharmacy shelves.
Morales and his alleged co-conspirators also engaged in sham financial transactions to facilitate and conceal the fraud schemes and the flow of fraud proceeds, according to court documents. In most instances, the sham transactions involved shell entities owned and/or controlled by Morales or his alleged co-conspirators.
According to court documents, Morales and his co-conspirators submitted and caused to be submitted approximately $23,367,755 in false and fraudulent claims to the Medicare and Florida Medicaid programs.
The case is being prosecuted by Trial Attorney Allan J. Medina and Special Trial Attorney William Parente of the Criminal Division’s Fraud Section. This case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,480 defendants who have collectively billed the Medicare program for more than $4.8 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with 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.
Member of Philadelphia La Cosa Nostra Sentenced to 55 Months <br /> in PrisonRead the Press Release
Louis Fazzini was sentenced today to serve 55 months in prison for his participation in a racketeering conspiracy involving illegal gambling and theft from an employee benefit plan, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division, U.S. Attorney Zane David Memeger of the Eastern District of Pennsylvania and John Brosnan, Acting Special Agent in Charge of the FBI’s Philadelphia Division.
Fazzini, 46, of Caldwell, N.J., was sentenced by U.S. District Judge Eduardo C. Robreno in the Eastern District of Pennsylvania. In addition to his prison term, Fazzini was sentenced to serve three years of supervised release following his prison term.
On Oct. 5, 2012, Fazzini pleaded guilty to conspiring to conduct and participate in the affairs of the Philadelphia La Cosa Nostra (LCN) Family through a pattern of racketeering activity. At the time of the plea colloquy, he admitted that, as a “made” member of the North Jersey crew of the Philadelphia LCN Family, he operated a sports bookmaking business and devised a fraudulent scheme to obtain health benefits through a “no show” job controlled by the LCN in furtherance of the racketeering conspiracy. As a “no show” employee, Fazzini performed no work or productive services, while still receiving health benefits.
The case is being prosecuted by Trial Attorney John S. Han of the Criminal Division’s Organized Crime and Gang Section and Assistant U.S. Attorneys Frank A. Labor III and Suzanne B. Ercole of the Eastern District of Pennsylvania. Valuable prosecutorial assistance was provided by the Pennsylvania Office of the Attorney General.
The case is being investigated by the FBI, the Internal Revenue Service-Criminal Investigation, the Pennsylvania State Police, the New Jersey State Police, the Philadelphia Police Department, and the U.S. Department of Labor’s Office of Inspector General Office of Labor Racketeering and Fraud Investigations, and the U.S. Department of Labor’s Employee Benefits Security Administration. Additional assistance was provided by the New Jersey Department of Corrections.
Justice Department to Monitor Elections in Illinois and KansasRead the Press Release
The Justice Department announced today that the Civil Rights Division will monitor elections on Feb. 26, 2013, in Cook County, Ill., and Seward County, Kan. The monitoring will ensure compliance with the Voting Rights Act of 1965 and other federal voting rights statutes. The Voting Rights Act prohibits discrimination in the election process on the basis of race, color or membership in a minority language group. In addition, the act requires certain covered jurisdictions to provide language assistance during the election process. Cook County is required to provide language assistance to its Hispanic, Chinese and Asian Indian voters, and Seward County is required to provide language assistance to its Hispanic voters.
Justice Department personnel will monitor polling place activities in Cook and Seward Counties. Civil Rights Division attorneys will coordinate federal activities and maintain contact with local election officials.
Each year, the Justice Department deploys hundreds of federal observers from the Office of Personnel Management, as well as departmental staff, to monitor elections across the country. To file complaints about discriminatory voting practices, including acts of harassment or intimidation, voters may call the Voting Section of the Justice Department’s Civil Rights Division at 1-800-253-3931.
Visit www.justice.gov/crt/voting/index.php for more information about the Voting Rights Act and other federal voting laws.
Alleged Aryan Brotherhood of Texas Leader <br /> Indicted on Federal Racketeering ChargesRead the Press Release
James Francis Sampsell has been indicted in Houston for his alleged role as a leader of a racketeering enterprise known as the Aryan Brotherhood of Texas (ABT), announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Attorney Kenneth Magidson of the Southern District of Texas.
The second superseding indictment returned on Wednesday, Feb. 20, 2013, by a federal grand jury in Houston charges Sampsell, aka “Skitz,” 50, of Midland, Texas, with conspiracy to engage in racketeering activity and possession with intent to deliver methamphetamine.
Sampsell’s co-defendants, who were previously charged for their alleged roles in the racketeering conspiracy, range from senior leaders to soldiers of the ABT, a “whites only,” prison-based gang with members operating inside and outside of state and federal prisons throughout Texas and elsewhere in the United States since at least the early 1980s. In total, the second superseding indictment charges 33 alleged members of the ABT.
According to court documents, the ABT has a detailed and uniform organizational structure, with territory divided into five regions, each run by a “general.” Four alleged ABT generals, Terry Ross Blake, 55, aka “Big Terry”; Larry Max Bryan, 51, aka “Slick”; William David Maynard, 42, aka “Baby Huey”; and Charles Lee Roberts, 68, aka “Jive,” were charged in the superseding indictment with conspiracy to participate in the racketeering activities of the ABT, among other charges. The second superseding indictment charges the fifth general, Sampsell, with conspiracy to participate in the racketeering activities of the ABT, among other charges.
In total, the second superseding indictment charges 33 alleged members of the ABT with conspiracy to participate in the racketeering activities of the ABT. Alleged members of the ABT are also charged with involvement in three murders, multiple attempted murders, kidnappings, assaults and conspiracy to distribute methamphetamine and cocaine. On Jan. 31, 2012, two previously indicted alleged gang members, Ben Christian Dillon, aka, “Tuff”, 40, of Houston, and James Marshall Meldrum, aka “Dirty,” 40, of Dallas, each pleaded guilty before U.S. District Judge Sim Lake in Houston.
According to court documents, 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 court documents, previously, the ABT was primarily concerned with the protection of white inmates and white supremacy/separatism. Over time, the ABT is alleged to have 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 violate the rules or pose 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.”
The racketeering and drug conspiracy charges each carry a maximum penalty of life in prison. The murder-related charges carry maximum penalties of life in prison or the death penalty.
An indictment is not evidence of guilt. All defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
This case is being investigated by a multi-agency task force consisting of the Bureau of Alcohol, Tobacco, Firearms and Explosives; 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 Department; Houston Police Department-Gang Division; Texas Department of Criminal Justice – Office of Inspector General; Harris County, Texas, Sheriff’s Office; Tarrant County, Texas, Sheriff’s Office; Atascosa County, Texas, Sheriff’s Office; Orange County, Texas, Sheriff’s Office; Waller County, Texas, Sheriff’s Office; Fort Worth, Texas, Police Department; San Antonio Police Department; Baytown, Texas, Police Department; Carrollton, Texas, Police Department; Alvin, Texas, Police Department; Montgomery County District Attorney’s Office; Atascosa County District Attorney’s Office; Harris County District Attorney’s Office; and the Kaufman County, Texas, 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.
United States Joins Lawsuit Alleging Lance Armstrong and Others Caused the Submission of <br /> False Claims to the U.S. Postal ServiceRead the Press Release
The Department of Justice announced today that the government has joined a civil lawsuit alleging that Lance Armstrong, Johan Bruyneel and Tailwind Sports LLC and Tailwind Sports Corporation (Tailwind) submitted or caused the submission of false claims to the U.S. Postal Service (USPS) in connection with its sponsorship of a professional bicycle racing team by regularly employing banned substances and methods to enhance their performance, in violation of the USPS sponsorship agreements.
From 1996 through 2004, the USPS sponsored a professional cycling team owned by Tailwind and its predecessors. Lance Armstrong was the lead rider on the team, and between 1999 and 2004, he won six consecutive Tour de France titles as a member of the USPS-sponsored team. Johan Bruyneel was the directeur sportif, or manager, of the cycling team.
The sponsorship agreements gave the USPS certain promotional rights, including the right to prominent placement of the USPS logo on the cycling team’s uniform. Each of the agreements required the team to follow the rules of cycling’s governing bodies, which prohibited the use of certain performance enhancing substances and methods. Between 2001 and 2004 alone, the Postal Service paid $31 million in sponsorship fees.
The lawsuit joined today by the government alleges that riders on the USPS-sponsored team, including Armstrong, knowingly caused the USPS agreements to be violated by regularly employing banned substances and methods to enhance their performance. The lawsuit further alleges that Bruyneel knew that team members were using performance enhancing substances and facilitated the practice.
The government today notified the court that it is joining this lawsuit against Armstrong, Bruyneel and Tailwind, and will file its formal complaint within 60 days.
“The Postal Service contract with Tailwind required the team to enter cycling races, wear the Postal Service logo, and follow the rules banning performance enhancing substances – rules that Lance Armstrong has now admitted he violated,” said Stuart F. Delery, Principal Deputy Assistant Attorney General for the Civil Division of the Department of Justice. “Today’s action demonstrates the Department of Justice’s steadfast commitment to safeguarding federal funds and making sure that contractors live up to their promises.”
“Lance Armstrong and his cycling team took more than $30 million from the U.S. Postal Service based on their contractual promise to play fair and abide by the rules – including the rules against doping,” said Ronald C. Machen Jr., U.S. Attorney for the District of Columbia. “The Postal Service has now seen its sponsorship unfairly associated with what has been described as ‘the most sophisticated, professionalized, and successful doping program that sport has ever seen.’ This lawsuit is designed to help the Postal Service recoup the tens of millions of dollars it paid out to the Tailwind cycling team based on years of broken promises. In today’s economic climate, the U.S. Postal Service is simply not in a position to allow Lance Armstrong or any of the other defendants to walk away with the tens of millions of dollars they illegitimately procured.”
“The Postal Service conducts business with many different contractors and subcontractors, with a large majority of them providing a much needed service and fulfilling their contractual duties. It is critical that public confidence in contractor performance remains high. When that public trust is compromised, as occurred in this case, the Office of Inspector General will fully investigate,” said David C. Williams, Inspector General, U.S. Postal Service, and Office of Inspector General.
“The Postal Service strongly supports intervention by the Department of Justice in this matter and a vigorous pursuit of this case,” said Postal Service General Counsel and Executive Vice President Mary Anne Gibbons. “The defendants agreed to play by the rules and not use performance enhancing drugs. We now know that the defendants failed to live up to their agreement, and instead knowingly engaged in a pattern of activity that violated the rules of professional cycling and, therefore, violated the terms of their contracts with the Postal Service. For that reason, the Postal Service fully agrees with the decision by the Department of Justice to seek appropriate damages under the False Claims Act.”
For many years, including during the USPS sponsorships, Armstrong and others repeatedly denied that the team used performance enhancing substances or methods. Yet on Oct. 10, 2012, the U.S. Anti-Doping Agency (USADA) issued a report concluding that Armstrong used banned performance enhancing substances starting in at least 1998 and continuing throughout his professional career, and that he pressured and helped his teammates to engage in similar conduct. Accordingly, USADA disqualified all of his competitive results since Aug. 1, 1998, including his seven Tour de France victories, and banned him from sport for life pursuant to the World Anti-Doping Code.
In a recently-televised interview with Oprah Winfrey, Armstrong contradicted his earlier denials and admitted that he used banned substances and methods throughout his career, starting in the mid-1990s. In particular, he admitted having engaged in banned practices during each of his seven Tour de France victories, including the six he won as a USPS rider. Armstrong explained that he avoided detection by anti-doping authorities by carefully timing his use of banned drugs so that they would leave his system prior to his undergoing cycling’s required periodic drug testing.
The lawsuit joined by the United States was filed by Floyd Landis, a former rider and teammate of Armstrong on the USPS sponsored team from 2002 through 2004. The lawsuit was filed under the False Claims Act, which imposes liability on those who submit false claims for government funds, and provides for the recovery of three times the government’s damages, plus civil penalties. The False Claims Act contains a qui tam or whistleblower provision, which permits private parties to sue on behalf of the United States for false claims and share in any recovery. The False Claims Act permits the government to investigate the allegations and intervene, or decline to intervene in the whistleblower’s lawsuit. While the government notified the court that it was joining the lawsuit’s allegations as to Armstrong, Bruyneel, and Tailwind, it advised the court that it was not intervening in the case as to several other defendants named in the complaint.
Principal Deputy Assistant Attorney General Delery and U.S. Attorney Machen commended the coordinated effort of the Civil Division’s Commercial Litigation Branch, the U.S. Attorney’s Office for the District of Columbia, and the USPS Office of Inspector General and Office of General Counsel, in their investigation of this matter.
The lawsuit, filed in the U.S. District Court for the District of Columbia, is captioned United States ex rel. Landis v. Tailwind Sports Corporation, et al. The claims made in the complaint are only allegations and do not constitute a determination of liability. Trial Attorney Robert Chandler of the Department of Justice’s Civil Division and Assistant U.S. Attorneys Darrell Valdez and Mercedeh Momeni of the U.S. Attorney’s Office for the District of Columbia are representing the government.
Singapore-Based Shipping Company to Pay $2.2 Million for Covering up Oil PollutionRead the Press Release
Pacific International Lines, a Singapore-based container ship company, was sentenced today in D.C. federal court under the terms of a plea agreement that requires the company to pay $2.2 million in criminal penalties, the Department of Justice announced today. Pacific International Lines previously pleaded guilty to three felony charges that it made false statements to the U.S. Coast Guard and violated the Act to Prevent Pollution from Ships by concealing illegal waste water operations and discharges in a falsified oil record book – a required log in which all overboard discharges must be recorded – and operating a vessel in waters of the United States without a functioning oil water separator (a required pollution control device). The charges are a result of Pacific International Lines illegal operation of the vessel M/V Southern Lily 2 in June 2012.
"Today's sentencing is a noteworthy success for the few federal law enforcement agencies charged with enforcing U.S. and international maritime laws protecting the oceans and natural marine resources both around the remote U.S. Pacific Islands and throughout the vast area of the South Pacific," said Joshua J. Masterson, Special Agent-in-Charge of Coast Guard Investigative Service-Pacific Region. "This case, being the third of its kind since 2011, should send a clear message to those shipping companies and mariners who willfully cut corners and violate the laws enacted to protect the oceans as well as place a much needed spotlight on this region of the South Pacific."
According to the plea agreement, including a joint factual statement, the company operated the vessel Southern Lily 2 in American Samoa. On June 22, 2012, the vessel was boarded by the U.S. Coast Guard for a routine inspection. During the inspection the Coast Guard discovered that the ship’s oil water separator was not functioning. The Coast Guard learned that the device had not been functioning for several months and, at the direction of the chief and second engineer, the oily waste water had been being discharged overboard in violation of international law. The illegal discharges and the fact that the oil water separator did not function was not entered in the ship’s oil record book as required by federal law.
Additionally, under the terms of the plea agreement, Pacific International Lines was placed on probation for three years, during which time it must operate under the terms of a government-approved Environmental Compliance Plan. The plan includes review by an independent auditor of any of Pacific International Lines ships—including the Southern Lily 2—that trade in the United States.
In addition to the $2 million criminal fine, the judge also ordered Pacific International Lines to pay $200,000 to support community service projects. The projects will be administered by the National Fish & Wildlife Foundation asnd the National Marine Sanctuary Foundation.
Engine room operations on-board large ocean-going vessels such as the Southern Lily 2 generate large amounts of waste oil and oil contaminated bilge waste. International and U.S. law prohibit the discharge of waste containing more than 15 parts per million oil and without treatment by an oil water separator and oil sensing equipment—a required pollution prevention device. The Act to Prevent Pollution from Ships also requires that all overboard discharges be recorded in an oil record book, which is subject to inspection by the Coast Guard. The waste oil may be incinerated on board the ship or offloaded in port for proper disposal.
In related prosecutions, the second engineer of the Southern Lily 2, Qing Cao, pleaded guilty to a felony information charging him with operating the Southern Lily 2 in Waters of the United States without a functioning oil water separator in violation of the Act to prevent Pollution from Ships. The court sentenced Cao to 36 months of probation and ordered Cao to depart the United States immediately. As a condition of probation, the court ordered Cao not to work on any vessels that call at U.S. ports during the term of his probation.
This investigation was conducted by the Pacific Regional Office of the U.S. Coast Guard Investigative Service Honolulu, Hawaii, and Senior Litigation Counsel Howard P. Stewart of the Justice Department’s Environmental Crimes Section.
Justice Department Sues to Shut Down Tennessee Tax Return PreparersRead the Press Release
The United States has asked a federal court in Memphis, Tenn., to permanently bar husband and wife team Ahmed Grant and Lillian Madyun from preparing federal income tax returns for others, the Justice Department announced today. According to the government complaint, Grant and Madyun have operated multiple tax return preparation businesses in the Memphis area, including SuperFast Taxes, MG Services, and most recently, Taxes-R-Us.
The complaint alleges that Grant and Madyun have prepared returns that unlawfully overstate refunds and understate tax liability through a variety of schemes. Specifically, the government alleges that Grant and Madyun have prepared returns that unlawfully claim the Earned Income Tax Credit for their clients by reporting fictitious Schedule C business income. The government alleges that Grant and Madyun also prepared returns that claimed the American Opportunity Credit, to which their clients were not entitled, without their clients’ knowledge or consent. According to the complaint, ninety percent of the American Opportunity Credits claimed on their clients’ returns were false. The complaint further alleges that Grant and Madyun improperly ensured that their clients’ refunds were deposited into their own business’s bank account. The estimated harm to the government is over $2 million for the 2010 tax year alone, and may be as high as $5 million, according to the complaint.
This lawsuit is part of the Justice Department’s nationwide crackdown on tax scams, including the preparation of fraudulent federal tax returns. In the past decade the Justice Department’s Tax Division has obtained injunctions against hundreds of tax-return preparers and tax-fraud promoters. Information about these cases is available on the Justice Department website .
Related Materials:
United States v. Ahmed Grant, et al.
Grant Madyun Complaint (PDF)Illegal Marketer of Medicare Information Admits Role<br /> in Detroit-area Home Health Care Fraud SchemeRead the Press Release
A health care worker who sold Medicare beneficiary information to Detroit-area home health agency operators as part of a $24.7 million home health care fraud conspiracy pleaded guilty today for his role in the scheme, which sought to profit by billing for home healthcare services that were medically unnecessary and not provided.
The guilty plea was announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division, U.S. Attorney for the Eastern District of Michigan Barbara L. McQuade, Special Agent in Charge Robert D. Foley III of the FBI’s Detroit Field Office and Special Agent in Charge Lamont Pugh III of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), Chicago Regional Office.
Clarence Cooper, 54, of Detroit, pleaded guilty before U.S. District Judge Victoria A. Roberts in the Eastern District of Michigan to one count of conspiracy to commit health care fraud.
According to court documents, Cooper and others conspired to defraud Medicare through purported home health care companies operating in the Detroit area, including now-defunct First Choice Home Health Care Services Inc. and Reliance Home Care, LLC. Cooper admitted that he sold Medicare information he obtained from Detroit-area Medicare beneficiaries to other conspirators at these and other health care companies, knowing that it was to be used to submit claims to Medicare for home health services that were not medically necessary and/or not provided. According to court documents, from 2008 through May 2012, Cooper sold co-conspirators the Medicare information of hundreds of Medicare beneficiaries, at $200 to $300 per beneficiary, and this Medicare information was used at these companies to bill Medicare for nearly $1 million in home health care services.
Court documents show that the larger scheme in which Cooper participated resulted in more than $24.7 million in claims to Medicare for the cost of home health services, psychotherapy and other medical services.
Cooper faces a maximum potential penalty of 10 years in prison and a $250,000 fine. Sentencing is currently scheduled for July 23, 2013.
This case is being prosecuted by Trial Attorney William G. Kanellis and Assistant Chief Gejaa Gobena of the Criminal Division’s Fraud Section. It was investigated by the FBI and HHS-OIG, and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Michigan.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,480 defendants who have collectively billed the Medicare program for more than $4.8 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is 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.
Two Men Arrested for Alleged Extortion of Detroit-Area Restaurant OwnerRead the Press Release
Two men were arrested today on charges of allegedly extorting a Detroit-area restaurant owner, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division, U.S. Attorney Barbara L. McQuade for the Eastern District of Michigan and Robert D. Foley III, Special Agent in Charge of the FBI Detroit Field Division.
Giuseppe D’Anna, aka “Joe,” 60, and Girolamo D’Anna, aka “Mimmo,” 48, were charged in an indictment unsealed today in U.S. District Court in the Eastern District of Michigan. Both defendants made their initial court appearances today in Detroit.
The defendants are charged in a three-count indictment with one count of Hobbs Act conspiracy and two counts of attempted Hobbs Act extortion, each of which carries a maximum penalty of 20 years in prison. According to the indictment, the defendants and other co-conspirators allegedly attempted to extort the owner of a Shelby Township, Mich., restaurant from approximately 2009 through approximately April 2011.
Indictments are only charges and not evidence of guilt. The defendants are presumed to be innocent until and unless proven guilty.
The investigation of this case was led by the FBI’s Detroit Field Division. Assistant U.S. Attorney Eric Straus of the Eastern District of Michigan and Principal Deputy Chief David Jaffe of the Organized Crime and Gang Section in the Justice Department’s Criminal Division are prosecuting the case on behalf of the United States.
Justice Department Seeks to Shut Down New Jersey Tax Return PreparerRead the Press Release
The United States has asked a federal court in Camden, N.J., to bar Doris E. Baules, who operates D’Vazquez Tax Solutions, from preparing tax returns for others, the Justice Department announced today. According to the government complaint, Baules continually and improperly claimed the Earned Income Tax Credit (EITC) on her clients’ returns to enable them to receive erroneous tax refunds. The suit alleges that the defendant improperly increases their EITC claims.
According to the complaint, the Internal Revenue Service previously conducted an investigation into the tax returns that Baules prepared for the 2009 tax year, and assessed $12,500 in return preparer penalties against her because she failed to exercise due diligence in determining whether her clients were entitled to the EITC. Baules continued to claim increased EITC on returns she prepared even after the IRS contacted her. According to the complaint, the total harm to the U.S. Treasury caused by Doris Baules’ misconduct is estimated to be as high as $6.2 million.
In the past decade the Justice Department’s Tax Division has obtained injunctions against hundreds of tax-return preparers and tax-fraud promoters. Information about these cases is available on the Justice Department website
Related Materials:
United States v. Doris E. Baules
Complaint for Permanent Injunction and Other Relief (PDF)
Justice Department Seeks to Shut Down Detroit-Area Tax Return PreparersRead the Press Release
The Justice Department announced today that it has asked a federal court in Detroit to permanently bar Calvin Carter and brothers Raheen Stroud and Laron Stroud, who do business as E-File Tax Pros LLC and Tax King, from preparing federal tax returns. The civil injunction suit alleges that Carter and the Stroud brothers falsify customers’ income on their tax returns, frequently by fabricating business income and expenses, in order to claim the maximum earned income tax credit (EITC) for them.
The EITC is a refundable credit available to certain low-income people. The maximum credit in 2010 was $5,666. Due to the method used to calculate the EITC, people with higher annual incomes may be entitled to a larger credit. Some tax preparers refer to the range of earned income generating a maximum EITC as the “sweet spot.” According to the complaint, Carter and the Stroud brothers fabricated businesses and reported fake business income and expenses on their customers’ tax returns to achieve reported income in the EITC sweet spot. The complaint alleges that the defendants filed tax returns in 2009, 2010, and 2011 that had an extremely high refund-request rate of 97 percent.
The complaint also alleges that the defendants prepare returns for customers that falsely claim the first-time-homebuyer credit even though the customers had not bought new homes and were ineligible for the credit.
In the past decade the Justice Department’s Tax Division has obtained injunctions against hundreds of tax-return preparers and tax-fraud promoters. Information about these cases is available on the Justice Department website .
Related Materials:
United States v. Calvin Carter, et al.
Complaint for Permanent Injunction and Other Relief (PDF)
Former Officials and Broker of Peanut Corporation of America Indicted Related to Salmonella-Tainted Peanut ProductsRead the Press Release
A 76-count indictment was unsealed yesterday charging four former officials of the Peanut Corporation of America (PCA) and a related company with numerous charges relating to salmonella-tainted peanuts and peanut products, the Justice Department announced today. Stewart Parnell, 58, of Lynchburg, Va.; Michael Parnell, 54, of Midlothian, Va.; and Samuel Lightsey, 48, of Blakely, Ga., have been charged with mail and wire fraud, the introduction of adulterated and misbranded food into interstate commerce with the intent to defraud or mislead, and conspiracy. Stewart Parnell, Lightsey and Mary Wilkerson, 39, of Edison, Ga., were also charged with obstruction of justice.
Also yesterday, an information filed against Daniel Kilgore, 44, of Blakely was unsealed. On the same day that charges against Kilgore were filed, he pleaded guilty to that information, which charged him with mail and wire fraud, the introduction of adulterated and misbranded food into interstate commerce with the intent to defraud or mislead, and conspiracy.
The investigation into the activity at PCA began in 2009, after the Food and Drug Administration and the U.S. Centers for Disease Control and Prevention traced a national outbreak of salmonella to a PCA plant in Blakely as the likely source. As alleged in the indictment, the Blakely plant was a peanut roasting facility where PCA roasted raw peanuts and produced granulated peanuts, peanut butter, and peanut paste; PCA sold these peanut products to its customers around the country.
The charging documents charge that Stewart Parnell, Michael Parnell, Lightsey and Kilgore participated in a scheme to manufacture and ship salmonella-contaminated peanuts and peanut products, and in so doing misled PCA customers. As alleged in the indictment, those customers ranged in size from small, family-owned businesses to global, multibillion-dollar food companies.
“When those responsible for producing or supplying our food lie and cut corners, as alleged in the indictment, they put all of us at risk,” said Stuart F. Delery, who heads the Justice Department’s Civil Division. “The Department of Justice will not hesitate to pursue any person whose criminal conduct risks the safety of Americans who have done nothing more than eat a peanut butter and jelly sandwich.”
Although PCA is now no longer in business, the allegations against each of the defendants arise from his or her conduct while at PCA and a related company. The following allegations are set forth in the indictment: Stewart Parnell was an owner and president of PCA; Michael Parnell, who worked at P.P. Sales, was a food broker who worked on behalf of PCA; Lightsey was the operations manager at the Blakely plant from on or about July 2008 through February 2009; and Wilkerson held various positions at the Blakely plant – receptionist, office manager and quality assurance manager – from on or about April 2002 through February 2009. As charged in the information, Kilgore served as operations manager of the PCA plant in Blakely from on or about June 2002 through May 2008.
“We all place a great deal of trust in the companies and individuals who prepare and package our food, often times taking it for granted that the public’s health and safety interests will outweigh individual and corporate greed,” said Michael Moore, U.S. Attorney for the Middle District of Georgia. “Unfortunately and as alleged in the indictment, these defendants cared less about the quality of the food they were providing to the American people and more about the quantity of money they were gathering while disregarding food safety. This investigation was complex and extensive, and I credit the cooperation of our federal agencies with not only making sure that the cause of this outbreak was uncovered and the people responsible called to account, but also with working hard every day to make sure that parents across the country can feel confident that the food they are feeding their children is safe.”
The charging documents allege that Stewart Parnell, Michael Parnell, Lightsey and Kilgore participated in several schemes by which they defrauded PCA customers about the quality and purity of their peanut products and specifically misled PCA customers about the existence of foodborne pathogens, most notably salmonella, in the peanut products PCA sold to them. As the charging documents allege, the members of the conspiracy did so in several ways – for example, even when laboratory testing revealed the presence of salmonella in peanut products from the Blakely plant, Stewart Parnell, Michael Parnell, Lightsey and Kilgore failed to notify customers of the presence of salmonella in the products shipped to them.
In addition, the charging documents allege that Stewart Parnell, Michael Parnell, Lightsey and Kilgore participated in a scheme to fabricate certificates of analysis (COAs) accompanying various shipments of peanut products. COAs are documents that summarize laboratory results, including results concerning the presence or absence of pathogens. As alleged in the charging documents, on several occasions these four defendants participated in a scheme to fabricate COAs stating that shipments of peanut products were free of pathogens when, in fact, there had been no tests on the products at all or when the laboratory results showed that a sample tested positive for salmonella.
After the salmonella outbreak that gave rise to this investigation, FDA inspectors visited the plant several times in January 2009. According to the indictment, the inspectors asked specific questions about the plant, its operations, and its history, and, in several instances, Stewart Parnell, Lightsey and Wilkerson gave untrue or misleading answers to these questions.
“The charges announced today show that if an individual violates food safety rules or conceals relevant information, we will seek to hold them accountable,” said FDA Commissioner Margaret A. Hamburg, M.D. “The health of our families and the safety of our food system is too important to be thwarted by the criminal acts of any individual or company.”
Stewart Parnell, Michael Parnell, and Samuel Lightsey are each charged with two counts of conspiracy; multiple counts of introducing adulterated food into interstate commerce with the intent to defraud; multiple counts of introducing misbranded food into interstate commerce with the intent to defraud; multiple counts of interstate shipment fraud; and multiple counts of wire fraud. Stewart Parnell, Lightsey and Wilkerson are also charged with multiple counts of obstruction of justice.
Kilgore pleaded guilty to one count of conspiracy to commit fraud, one count of conspiracy to introduce adulterated and misbranded food into interstate commerce, eight counts of introducing adulterated food into interstate commerce with the intent to defraud, six counts of introducing misbranded food into interstate commerce with the intent to defraud, eight counts of interstate shipment fraud, and five counts of wire fraud.
Mark F. Giuliano, Special Agent in Charge, FBI Atlanta Field Office, stated, “The FBI was brought in to this matter to provide additional resources and expertise to a complex and very serious investigation. We fully understand the victim impact as a result of this salmonella outbreak and will be asking to hear from other possible victims in this matter.”
Individuals who feel that they may have been affected by or have become ill from tainted PCA products, and businesses that purchased products that were recalled as a result of the outbreak, should visit the following website for further details: https://forms.fbi.gov/pca-salmonella-tainted-product-case/
The case is being prosecuted by Trial Attorneys Patrick Hearn and Mary M. Englehart of the Consumer Protection Branch of the Civil Division of the Department of Justice and Assistant U.S. Attorney Alan Dasher of the Middle District of Georgia. Marietta Geckos, formerly a Trial Attorney with the Consumer Protection Branch, also worked on the prosecution. The case was investigated by the Food and Drug Administration’s Office of Criminal Investigations and the FBI.
An indictment is merely an allegation, and every defendant is presumed innocent until proven guilty beyond a reasonable doubt.
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Portable Document Format (PDF) files may be viewed with a free copy of Adobe Acrobat Reader.Related Materials:
Kilgore Information
PCA Indictment
Principal Deputy Assistant Attorney General Stuart F. Delery Speaks at the PCA Pen and PadVice President Biden and Attorney General Holder Honor<br /> 18 Public Safety Officers with Medal of ValorRead the Press Release
Vice President Joe Biden and Attorney General Eric Holder today awarded the Public Safety Officer Medal of Valor to 18 public safety officers who exhibited exceptional courage in saving and protecting others and whose heroic actions were above and beyond the call of duty.
“This year’s Medal of Valor recipients have fearlessly responded to desperate cries for help – courageously risking their own lives to secure innocent victims, protect fellow officers, and end deadly assaults,” said Attorney General Eric Holder. “These extraordinary public servants have distinguished themselves by going above and beyond the call of duty. And today, I am honored to join Vice President Biden in bestowing one of our nation’s most prestigious decorations on each of these heroes.”
The Medal of Valor, authorized by the Public Safety Medal of Valor Act of 2001, is awarded by the President of the United States to public safety officers cited by the Attorney General. Public safety officers are nominated by the chiefs or directors of their employing agencies and recommended by the Medal of Valor Review Board. The Attorney General has designated the department’s Office of Justice Programs (OJP) to serve as the federal point of contact for the Medal of Valor initiative. OJP’s Bureau of Justice Assistance (BJA), led by Director Denise E. O’Donnell, administers the Medal of Valor initiative.
“We recognize 18 extraordinary individuals for their quick thinking, selflessness and exceptional courage,” said Office of Justice Program Acting Assistant Attorney General Mary Lou Leary. “They are law enforcement, corrections officers, and firefighters who went beyond the call of duty to risk – and in some cases, to give – their lives for their fellow citizens and colleagues.”
Today’s 18 recipients of the Medal of Valor are: Officer Julie Olson, Maplewood Police Department, Minn.; Officer Reeshemah Taylor, Osceola County Corrections Department, Fla.; Wildlife Officer Michael Neal, Arkansas Game and Fish Commission; Officer Sean Haller and Officer Rafael Rivera, California Highway Patrol; Trooper Robert Lombardo and fallen Trooper Joshua Miller, Pennsylvania State Police; Firefighter Peter Demontreux, New York City Fire Department; Firefighter Hope Scott and Captain William Reynolds, Virginia Beach Fire Department, Va.; Deputy Sheriff Krista McDonald, Kitsap County Sheriff’s Office, Wash.; Officers Timothy McClintick, Max McDonald, Douglas Weaver, Sergeant Karl Lounge Jr. and fallen Sergeant Thomas Baitinger, St. Petersburg Police Department, Fla.; and fallen Deputies William Stiltner and Cameron Justus, Buchanan County Sheriff's Office, Va.
“The Public Safety Officer Medal of Valor is the highest national award for valor awarded to a public safety officer,” said Bureau of Justice Assistance Director, Denise E. O’Donnell. “BJA is proud to administer a program which serves to recognize the exceptionally brave actions of individuals who have given selflessly in order to protect citizens and communities throughout our nation.”
Including today’s awardees, a total of 78 medals have been presented since the first recipients were honored in 2003. More information about the award and today’s recipients, the Medal of Valor Review Board members, and the nomination process is on the OJP website at: www.ojp.usdoj.gov/medalofvalor .
Related Materials:
Attorney General Eric Holder Speaks at the Medal of Valor Awards Ceremony
Acting Assistant Attorney General for the Office of Justice Programs Mary Lou Leary Speaks at the Medal of Valor Awards CeremonyNorth Carolina Commodities Firm Owner Sentenced to 36 Months in Prison for Multimillion-dollar FraudRead the Press Release
The principal and co-owner of North Carolina-based Integra Capital Management LLC, was sentenced today to serve 36 months in prisonfor his role in a scheme to defraud commodities trading investors of more than $3.2 million, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Attorney of the Western District of North Carolina Anne M. Tompkins. Nicholas Cox, 35, of Lexington, N.C., was sentenced by U.S. District Judge Max O. Cogburn Jr., in the Western District of North Carolina. In addition to his prison term, Cox was sentenced to serve three years of supervised release and ordered to pay $1,981,477 in restitution. On Dec. 22, 2012, Cox pleaded guilty in the Western District of North Carolina to one count of conspiracy to commit mail fraud, five counts of mail fraud and one count of conspiracy to commit money laundering. According to court documents, between September 2006 and January 2009, Cox and his co-conspirator, Rodney Whitney, 50, of Archdale, N.C.,the co-owner of Integra, engaged in a scheme to defraud investors in commodity trading pools operated by the firm. Integra was established purportedly for the purpose of pooling investors’ funds in commodity pools, and investing in commodity futures and foreign currency exchange trading. According to court documents, Cox and Whitney obtained and misappropriated more than $3.2 million in investor funds and fabricated account statements and tax forms to conceal their fraud. According to court documents, Cox and Whitney falsely represented, among other things, that Integra’s managers had more than 30 years of combined market experience; that Integra paid dividends of two to five percent of the investor’s initial investment, which was derived from Integra’s trading profits; and investors could remove their principal investments within five days upon giving notice to Integra. According to court documents, Cox and Whitney used the money invested by later investors to pay the monthly investment returns they had promised to earlier investors, to purchase real estate, to fund other business ventures and to purchase automobiles and other personal goods and services. On March 21, 2011, Whitney pleaded guilty to one count of conspiracy to commit mail and wire fraud and one count of conspiracy to commit money laundering. He was sentenced on Jan. 7, 2013, to 60 months in prison for his role in the scheme. The case was prosecuted by Trial Attorney Luke Marsh of the Criminal Division' s Fraud Section and Benjamin Bain-Creed and Kenny Smith of the U.S. Attorney’s Office for the Western District of North Carolina. The case was investigated by the U.S. Postal Inspection Service. This prosecution was done in coordination with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.StopFraud.gov .Justice Department Releases Spanish Language Video About Discrimination in Employment Eligibility VerificationRead the Press Release
The Civil Rights Division of the Justice Department announced today the launch of its first Spanish-language educational video. The video was developed by the Office of Special Counsel (OSC) for Immigration-Related Unfair Employment Practices to assist employers in avoiding charges of discrimination in the Employment Eligibility Verification Form I-9 process and to assist employees to be aware of their legal rights. OSC enforces the anti-discrimination provision of the Immigration and Nationality Act (INA), which prohibits employers from discriminating against work-authorized individuals in hiring, firing, and recruitment or referral for a fee, regardless of their citizenship status or national origin. The law additionally prohibits discrimination during the Form I-9 and E-Verify processes.
OSC developed the video to address an issue that frequently comes to OSC’s attention through calls to its hotline and charges filed by employees. Employers occasionally incorrectly believe that they need to reverify the employment authorization of lawful permanent resident workers when their Permanent Resident Cards expire. OSC’s new video illustrates this practice, explaining that is not permissible and may lead to claims under the anti-discrimination provision.
“We believe this video will help both employers and employees across the country understand employment eligibility verification rules and also help lawful permanent residents maintain their employment,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “Federal law prohibits discrimination in the employment eligibility verification process, and the Justice Department is committed to enforcing the law.”
The Spanish language video may be viewed at: www.youtube.com/watch?v=HLps_3sWJxk.
A version of the same video subtitled in English can be viewed at: www.youtube.com/watch?v=XWRSMNFxxKY.
The video is part of OSC’s series of educational videos launched in 2012. OSC also operates a hotline for employers and workers, frequently providing guidance to employers on how to avoid discrimination and educating employees on rights protected by the anti-discrimination provision. OSC offers live webinars to educate employers on avoiding workplace discrimination and to educate employees about their rights. The next Spanish language webinar will be held today at 3:00 pm. You can register on-line at http://www.justice.gov/crt/about/osc/webinars.php. For more information about protections against employment discrimination under the immigration law, call OSC’s worker hotline at: 1-800-255-7688 (1-800-237-2525, TDD for the hearing impaired); call OSC’s employer hotline at: 1-800-255-8155 (1-800-362-2735, TDD for the hearing impaired); send an e-mail to: [email protected]; or visit OSC’s website www.justice.gov/crt/about/osc.Justice Department Reaches Settlement with FTD Inc. to Resolve Immigration-Related Retaliation ClaimRead the Press Release
The Justice Department announced today that it reached an agreement with FTD Inc., to resolve allegations that the company retaliated against a man for asserting rights under the anti-discrimination provision of the Immigration and Nationality Act (INA).
The Justice Department initiated the investigation after receiving a complaint from a work-authorized immigrant that FTD rescinded the individual’s conditional job offer after a background check revealed a purported error in his Social Security account number. The man informed FTD that he was authorized to work in the United States and provided documents showing his status. The man also expressed concern to FTD that the company may be violating the anti-discrimination provision of the INA by refusing to hire him and threatened to pursue his legal rights under the INA’s anti-discrimination provision. FTD responded by terminating all communication with the individual.
Under the terms of the agreement, FTD has agreed to pay $1,800 in back pay to the man and $3,000 in civil penalties. FTD has also agreed to undergo Justice Department training on the anti-discrimination provision of the INA. The case settled prior to the Justice Department filing a complaint in this matter.
“People authorized to work in this country should not be afraid to dispute errors in databases relating to their employment eligibility or documents,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “It is unlawful to retaliate against an individual for asserting a right to work under the anti-discrimination provision of the INA.”
The Office of Special Counsel for Immigration-Related Unfair Employment Practices (OSC) is responsible for enforcing the anti-discrimination provision of the INA. For more information about protections against employment discrimination under the immigration laws, call the OSC’s worker hotline at 1-800-255-7688 (1-800-237-2525, TDD for hearing impaired), call the OSC’s employer hotline at 1-800-255-8155 (1-800-362-2735, TDD for hearing impaired), sign up for a no-cost webinar at www.justice.gov/about/osc/webinars.php , email [email protected] or visit the website at www.justice.gov/crt/about/osc .
Former U.S. Army Staff Sergeant Pleads Guilty in Tennessee <br /> to Bribery SchemeRead the Press Release
A former U.S. Army staff sergeant pleaded guilty today to accepting thousands of dollars in bribes from contractors while he was deployed to Iraq, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Attorney for the Eastern District of Tennessee William C. Killian.
Richard A. Gilliland, 44, of Fayetteville, Tenn., pleaded guilty before U.S. Magistrate Judge Susan K. Lee in the Eastern District of Tennessee to a criminal information charging him with one count of conspiracy to accept illegal bribes.
According to court documents, from October 2007 until November 2008, Gilliland was a U.S. Army staff sergeant who worked with the Civil Affairs Unit at Camp Victory in Iraq and also was assigned as a pay agent responsible for U.S. government funds. As a pay agent, Gilliland was responsible for paying contractors to perform work in accordance with civil development objectives set forth by U.S. Army commanders in furtherance of the strategic mission of Coalition Forces in Iraq.
While deployed to Iraq in October 2007, Gilliland worked closely with two Iraqi contracting companies and their American representatives. Gilliland admitted to receiving approximately $27,200 and a laptop in bribes from American representatives of the contracting companies in return for his attempt to influence contracts for the Iraqi-based contractors and his assistance in acquiring used and non-working generators from the Defense Reutilization and Marketing Office. After receiving the bribes, Gilliland wired the cash payments he received back to the United States.
The case is being prosecuted by Special Trial Attorney Mark Grider of the Criminal Division’s Fraud Section, on detail from the Special Inspector General for Iraq Reconstruction (SIGIR), and Assistant U.S. Attorney John MacCoon of the Eastern District of Tennessee. The case was investigated by SIGIR.
Former Albuquerque Corrections Officer Pleads Guilty to Obstruction of JusticeRead the Press Release
Matthew Pendley, 26, a former corrections officer at the Bernalillo County Metropolitan Detention Center (MDC) in Albuquerque, N.M., pleaded guilty today to one count of obstructing justice when he lied to law enforcement during their investigation of the assault on an inmate at the hands of another corrections officer.
According to court documents, during the early morning hours of Dec. 21, 2011, Pendley was assigned to the Receiving-Discharge-Transfer (RDT) Unit at MDC where individuals are brought to be booked soon after they are arrested. During the course of his shift, Pendley entered the shower room/dress out area and witnessed Demetrio Gonzales, another corrections officer, assaulting an inmate. The inmate was not posing a physical threat to anyone, and therefore, the assault was not justified. There was no legitimate law enforcement purpose for Gonzales to use force on the inmate. As a result of the assault, the inmate sustained injuries and began bleeding. When the Bernalillo County Sheriff’s Office (BCSO) began investigating, instead of telling detectives that he witnessed the assault, Pendley lied, claiming that he did not remember what Gonzales was doing in the shower room/dress out area.
A sentencing date has not yet been set.
Demetrio Gonzales previously pleaded guilty to violating the civil rights of the inmate by choking and striking the inmate multiple times. He was sentenced on Jan. 8, 2013, to 33 months in prison followed by three years of supervised released.
A third former MDC corrections officer, Kevin Casaus, was also indicted by a federal grand jury in June 2012 on related charges. Casaus is charged with violating the victim’s civil right rights when he shoved and struck the victim while in the shower area/dress out area. Casaus is further charged with obstruction of justice and falsification of records, first for making false statements to detectives of the BCSO and then for falsifying his incident report. Casaus’ trial is set for March 4, 2013. He is presumed innocent unless proven guilty.
This case is being investigated by the Albuquerque Division of the FBI and is being prosecuted by Assistant U.S. Attorney Mark T. Baker for the District of New Mexico and Trial Attorney Fara Gold of the Civil Rights Division of the U.S. Department of Justice.
El Departamento de Justicia Lanza un Video en Español Sobre la Discriminación en la Verificación de la Elegibilidad para el EmpleoRead the Press Release
WASHINGTON – La División de Derechos Civiles del Departamento de Justicia anunció hoy el lanzamiento de su primer video educativo en español. El video fue elaborado por la Oficina del Consejero Especial [Office of Special Counsel (OSC)] para Prácticas Injustas de Empleo Relacionadas a la Inmigración para ayudar a los empleadores a evitar cargos de discriminación durante el proceso del Formulario I-9 de Verificación de Elegibilidad para el Empleo y para ayudar a los empleados a enterarse de sus derechos legales. La OSC hace cumplir la provisión contra la discriminación que contiene la Ley de Inmigración y Nacionalidad [Immigration and Nationality Act (INA)], la que prohíbe a los empleadores el discriminar en la contratación, el despido, el reclutamiento o la recomendación a personas autorizadas para trabajar, independientemente de su estado de ciudadanía u origen nacional. Asimismo, la ley prohíbe la discriminación durante los procesos del Formulario I-9 y de Verificación Electrónica [E-Verify].
La OSC elaboró un video sobre este tema llevado frecuentemente a la atención de la OSC por medio de llamadas a su línea directa y cargos presentados por empleados. Los empleadores suelen creer incorrectamente que necesitan verificar de nuevo la autorización de trabajo de trabajadores que tienen el status de residente permanentes cuando sus Tarjetas de Residente Permanente [Permanent Resident Cards or Green Card] se vencen. El nuevo video de la OSC aclara esta práctica y explica que esto no está permitido y que puede ser motivo de reclamos bajo la provisión contra la discriminación.
“Creemos que este video ayudará tanto a los empleadores como a los empleados de todo el país a comprender las normas de verificación de la elegibilidad para el empleo y que también ayudará a los residentes permanentes legales a conservar sus empleos”, dijo Thomas E. Perez, Secretario de Justicia Auxiliar de la División de Derechos Civiles. “La ley federal prohíbe la discriminación en el proceso de verificación de elegibilidad para el empleo, y el Departamento de Justicia se compromete a hacer cumplir la ley”.
Se puede observar el video en español en:
www.youtube.com/watch?v=HLps_3sWJxk
Una versión del mismo video con subtítulos en inglés se puede observar en :
www.youtube.com/watch?v=XWRSMNFxxKY
El video es parte de la serie de videos educativos de la OSC lanzo en el 2012. La OSC también opera una línea directa para empleadores y trabajadores, frecuentemente orientando a los empleadores acerca de cómo evitar la discriminación y educando a los al respecto de sus derechos protegidos por la provisión contra la discriminación. La OSC ofrece ‘webinars’ o seminarios por internet en vivo para educar a los empleadores acerca de cómo evitar la discriminación en el trabajo y educar a los empleados respecto de sus derechos. El próximo seminario por internet en español se dará a cabo hoy febrero 20 del 2013 a las 3:00pm tiempo del Este. Usted se puede registrar por internet en: http://www.justice.gov/crt/about/osc/webinars.php. Para obtener más información sobre las protecciones contra la discriminación laboral bajo la ley de inmigración, llame a la línea directa del trabajador de la OSC al: 1-800-255-7688 (1-800-237-2525, TDD para las personas con problemas auditivos); llame a la línea directa del empleador de la OSC al: 1-800-255-8155 (1-800-362-2735, TDD para las personas con problemas auditivos); envíe un mensaje de correo electrónico u ‘email’ a: [email protected]; o visite el portal en Internet de la OSC, www.justice.gov/crt/about/osc.Justice Department and Town of East Haven, Conn., Select Kathleen O’toole as Joint Compliance Expert for Police Reform AgreementRead the Press Release
The Department of Justice Civil Rights Division and the U.S. Attorney’s Office for the District of Connecticut announced today, together with the town of East Haven, Conn., and the East Haven Board of Police Commissioners, they have selected Kathleen O’Toole as the Joint Compliance Expert (JCE) to assess and report on the implementation of a comprehensive settlement agreement to reform the East Haven Police Department (EHPD). The district court approved the agreement on Dec. 21, 2012.
Under the agreement, the JCE will assist in determining whether the terms of the agreement have been fully and timely implemented. The JCE’s assessment will include a thorough review of EHPD’s policies, training curricula, standard operating procedures, plans, protocols and other operational documents related to the agreement. The JCE will also assess whether the implementation of the agreement is resulting in constitutional policing, increased community trust, and the professional treatment of individuals by EHPD officers.
Following a joint review that included multiple candidates, the parties selected Ms. O’Toole to serve as JCE. She brings extensive policing experience and a collaborative compliance framework that will assist the parties, the court, and other stakeholders to evaluate the implementation of critical reforms by EHPD. Ms. O’Toole is an internationally-recognized leader in the law enforcement field and recently completed a six-year term as Chief Inspector of the Garda Síochána Inspectorate, an oversight body responsible for bringing reform, best practice, and accountability to the Irish national police service. Previously, she worked her way up the ranks of the Boston Police Department, beginning as a patrol officer and eventually serving as Boston Police Commissioner. Ms. O’Toole also served as Massachusetts Secretary of Public Safety. Ms. O’Toole intends to hire several other police experts to assist her in assessing compliance with the agreement. She will begin her work as JCE immediately.
“We are pleased to have worked collaboratively with the town to select Ms. O’Toole, who we believe is uniquely positioned to assess and report on the East Haven Police Department’s reform efforts,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “We look forward to working together with Ms. O’Toole and the town to ensure effective and constitutional policing by the East Haven Police Department.”
U.S. Attorney David Fein commented, “I am pleased that the joint selection of Kathleen O’Toole as the Joint Compliance Expert will now allow the real work to begin on the implementation of the settlement agreement approved by the court.”
The full text of the settlement agreement is available at www.justice.gov/crt/about/spl/findsettle.php . For more information on the Justice Department’s Civil Rights Division, please visit www.justice.gov/crt .
Justice Department Reaches Settlement with Texas Champion Bank to Resolve Allegations of Lending DiscriminationRead the Press Release
The Justice Department announced today that Texas Champion Bank of Alice, Texas, will establish uniform pricing policies, conduct employee training and pay $700,000 as part of a settlement to resolve allegations that it engaged in a pattern or practice of discrimination on the basis of national origin.
The settlement, which is subject to court approval, was filed in conjunction with the Justice Department’s complaint in the U.S. District Court for the Southern District of Texas. The complaint alleges that Texas Champion charged higher prices on unsecured consumer loans made to His panic borrowers through its branch offices in violation of the Equal Credit Opportunity Act (ECOA).
“The complaint filed today demonstrates that the Civil Rights Division is committed to fair lending enforcement across the entire spectrum of credit markets,” said Thomas E. Perez, Assistant Attorney General for the Justice Department’s Civil Rights Division. “We commend Texas Champion for working cooperatively with the Justice Department in reaching an appropriate resolution of this case.”
The lawsuit originated from a 2010 referral by the Federal Deposit Insurance Corporation (FDIC) to the Justice Department’s Civil Rights Division. Texas Champion is a member of the FDIC.
Under the settlement, Texas Champion will pay $700,000 to approximately 2,000 Hispanic victims of discrimination, monitor its loans for potential disparities based on national origin, and provide equal credit opportunity training to its employees. Texas Champion will also revise its pricing policies to ensure that the price charged for its loans is set in a non-discriminatory manner consistent with the requirements of ECOA. The agreement also prohibits the bank from discriminating on the basis of national origin in any aspect of a credit transaction.
“The Southern District of Texas is committed to ensuring banks and other lending institutions do not discriminate against borrowers on the basis of race or national origin,” said U.S. Attorney for the Southern District of Texas Kenneth Magidson. “The consent order filed today should serve as a reminder that discrimination in lending will not be tolerated.”
The Justice Department’s enforcement of fair lending laws is conducted by the Fair Lending Unit of the Housing and Civil Enforcement Section in the Civil Right Division. Since the Fair Lending Unit was established in February 2010, it has filed or resolved 24 lending matters under the Fair Housing Act, ECOA, and the Servicemembers Civil Relief Act. The settlements in these matters provide for a minimum of $660 million in monetary relief for impacted communities and more than 300,000 individual borrowers. The Attorney General’s annual reports to Congress subject to ECOA highlight the department’s accomplishments in fair lending and are available at http://www.justice.gov/crt/publications .
The Civil Rights Division, the U.S. Attorney’s Office for the Southern District of Texas, and the FDIC are members of the Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes. For more information on the task force, visit www.StopFraud.gov .
A copy of the complaint, as well as additional information about fair lending enforcement by the Justice Department, can be obtained from the Justice Department’s website at www.justice.gov/fairhousing .
Baltimore Immigration Judge Participates in Naturalization CeremonyRead the Press Release
BALTIMORE --Immigration Judge John F. Gossart, Jr. from the Executive Office for Immigration Review, Baltimore Immigration Court, delivered the keynote speech and administered the oath of allegiance to approximately 75 candidates during a naturalization ceremony at the George H. Fallon Federal Building in Baltimore, Md., on Feb. 15, 2013. The Baltimore District Office of U.S. Citizenship and Immigration Services, Department of Homeland Security, hosted the ceremony.
Biographical Information
Attorney General William French Smith appointed Judge Gossart in October 1982. Judge Gossart received a bachelor of science degree in 1967 from the University of Maryland and a juris doctorate in 1974 from the University of Baltimore School of Law. From 1975 through 1982, he served in various positions at the former Immigration and Naturalization Service, including general attorney, trial attorney, and deputy assistant commissioner for naturalization. Since 1997, Judge Gossart has served as an adjunct professor of immigration law at the University of Baltimore School of Law; has been a faculty member at the National Judicial College; and has guest lectured at numerous law schools and for the Maryland Institute for Continuing Professional Education of Lawyers. From 1967 to 1969, he served in the U.S. Army. Judge Gossart is a member of the Maryland State and District of Columbia Bars.
- EOIR -
The Executive Office for Immigration Review (EOIR) is an agency within the Department of Justice. Under delegated authority from the Attorney General, immigration judges and the Board of Immigration Appeals interpret and adjudicate immigration cases according to United States immigration laws. EOIR’s immigration judges conduct administrative court proceedings in immigration courts located throughout the nation. They determine whether foreign-born individuals—whom the Department of Homeland Security charges with violating immigration law—should be ordered removed from the United States or should be granted relief from removal and be permitted to remain in this country. The Board of Immigration Appeals primarily reviews appeals of decisions by immigration judges. EOIR’s Office of the Chief Administrative Hearing Officer adjudicates immigration-related employment cases. EOIR is committed to ensuring fairness in all of the cases it adjudicates.
Executive Office for Immigration ReviewU.S. Trustee Program’s Settlement with Law Firm Includes Monetary Remedies, Independent ReviewRead the Press Release
WASHINGTON – The U.S. Trustee Program has filed in bankruptcy court a national settlement with law firm Kaye Scholer LLP in the bankruptcy case of GSC Group, Inc. If approved by the Bankruptcy Court for the Southern District of New York, the proposed settlement will resolve the U.S. Trustee’s allegations that Kaye Scholer failed to make accurate and complete disclosures in the case. In particular, the U.S. Trustee alleged that Kaye Scholer filed inaccurate documents about its retention as counsel to the chapter 11 debtor.
Under the proposed settlement, Kaye Scholer will pay $1.5 million; adopt policies and procedures approved by an independent expert to ensure the accuracy and completeness of disclosure, including checks for conflicts of interest and assurance that attorneys review documents filed in their name; establish a special compliance review committee to certify under penalty of perjury the law firm’s continuing compliance; and provide training to its attorneys and other staff to ensure the accuracy and completeness of documents it files in bankruptcy court.
If approved by the bankruptcy court, the settlement will mark the first time the U.S. Trustee Program has obtained relief that includes an independent expert’s review of a law firm’s practices.
“Leading law firms are not above the bankruptcy rules of disclosure and other professional obligations, and this agreement shows that violations will be addressed transparently and appropriately,” stated Clifford J. White III, Director of the Executive Office for U.S. Trustees. “I am pleased that Kaye Scholer has agreed to monetary remedies and independent review of its practices, so that the practices of the law firm, from senior partners on down, will be improved in the future.”
Director White noted that “the relief provided in this settlement, in conjunction with relief agreed to by financial adviser Capstone Advisory Group LLC in this same case, should cause all professionals in the bankruptcy system to review their own internal practices. Professionals in large bankruptcy cases are paid extraordinary sums of money, and failing to follow the rules pertaining to disclosure of possible conflicts of interest and related matters is not acceptable.”
Director White also commended U.S. Trustee Tracy Hope Davis for bringing the original action in the bankruptcy court in Manhattan, as well as attorneys who worked on the case, including Trial Attorney Andrea Schwartz of the U.S. Trustee’s Office in Manhattan and Trial Attorney Carole Ryczek of the U.S. Trustee’s Office in Madison, Wis.
The case is In re GSC Group Inc., U.S. Bankruptcy Court, Southern District of New York, No. 10-14653.
Contact:Jane Limprecht, Public Information Officer
Executive Office for U.S. Trustees
(202) 305-7411Florida-Based Lender Processing Services Inc. to Pay $35 Million<br /> in Agreement to Resolve Criminal Fraud Violations<br /> Following Guilty Plea from Subsidiary CEORead the Press Release
Lender Processing Services Inc. (LPS), a publicly traded mortgage servicing company based in Jacksonville, Fla., has agreed to pay $35 million in criminal penalties and forfeiture to address its participation in a six-year scheme to prepare and file more than 1 million fraudulently signed and notarized mortgage-related documents with property recorders’ offices throughout the United States. The settlement, which follows a felony guilty plea from the chief executive officer of wholly owned LPS subsidiary DocX LLC, was announced today by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Attorney for the Middle District of Florida Robert E. O’Neill.
The non-prosecution agreement, which LPS entered into today with the U.S. Department of Justice and the U.S. Attorney’s Office for the Middle District of Florida, requires the company to make the payment and meet a series of other conditions.
Lorraine Brown, the former CEO of DocX LLC, pleaded guilty on Nov. 20, 2012, in federal court in Jacksonville to conspiracy to commit mail and wire fraud. During her guilty plea, Brown admitted to her leadership role in the scheme.
LPS has taken a number of remedial actions to address the misconduct at DocX. Among other things, LPS has wound down all of DocX’s operations, re-executed and re-filed mortgage assignments as appropriate and terminated Brown and others. LPS has also demonstrated changes in its compliance, training and overall approach to ensuring its adherence to the law, and has retained an independent consultant to review and report on LPS’s document execution practices; assess related operational, compliance, legal and reputational risks; and establish a plan for reimbursing any financial injuries to mortgage servicers or borrowers.
According to the statement of facts accompanying the agreement, before its wind-down, DocX was in the business of assisting residential mortgage servicers with creating and executing mortgage-related documents to be filed with property recorders’ offices throughout the United States. Employees of DocX, at the direction of Brown and others, falsified signatures on the documents. Through this scheme and unbeknownst to the clients, Brown and subordinates at DocX directed authorized signers to allow other, unauthorized personnel to sign and to have documents notarized as if they were executed by authorized signers. These signing practices were used at DocX from at least March 2003 until late 2009, and were implemented to increase profits.
Also to increase profits, Brown hired temporary workers to sign as authorized signers. These temporary employees would sign mortgage-related documents at a much lower cost and without the quality controls represented to clients. These documents were then falsely notarized by employees at DocX, allowing the fraud scheme to remain undetected.
After these documents were falsely signed and fraudulently notarized, Brown authorized DocX employees to file and record them with local county property records offices across the country. Many of these documents – particularly mortgage assignments, lost note affidavits and lost assignment affidavits – were later relied upon in court proceedings, including property foreclosures and federal bankruptcy actions.
In entering into the non-prosecution agreement with LPS, the Justice Department took several factors into consideration. Soon after discovering the misconduct at DocX, LPS conducted a thorough internal investigation, reported all of its findings to the government, cooperated with the government’s investigation and effectively remediated any problems it discovered. The government’s investigation also revealed that Brown and others at DocX took various steps to actively conceal the misconduct from detection, including from LPS senior management and auditors.
Brown, 51, of Alpharetta, Ga., faces a maximum potential penalty of five years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. She is scheduled to be sentenced on April 23, 2013, before U.S. District Judge Henry Lee Adams Jr. in Jacksonville.
This case is being handled by Trial Attorney Ryan Rohlfsen and Assistant Chief Glenn S. Leon of the Justice Department’s Criminal Division Fraud Section and Assistant U.S. Attorney Mark B. Devereaux of the U.S. Attorney’s Office for the Middle District of Florida. The case is being investigated by the FBI, with assistance from the state of Florida’s Department of Financial Services.
Today’s disposition is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF). The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.StopFraud.gov.
Related Materials:
LPS Non-Prosecution Agreement
LPS Statement of FactsFlorida Woman Sentenced to Prison for Obstruction of Justice in Relation to Her Husband’s DisappearanceRead the Press Release
A Gainesville, Fla., woman was sentenced today to serve one year and one day in prison for her role in the obstruction of a multinational investigation into the disappearance of her husband, then an employee in the U.S. Consulate in Curacao, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division, U.S. Attorney Pamela C. Marsh for the Northern District of Florida, Director of the U.S. State Department’s Diplomatic Security Service ( DSS) Gregory B. Starr and Special Agent in Charge of the FBI’s Miami Field Office Michael B. Steinbach.
Abby Beard Hogan, 50, was sentenced by U.S. District Judge M. Casey Rodgers in the Northern District of Florida. In addition to her prison term, Hogan was sentenced to two years of supervised release. On March 29, 2012, Hogan pleaded guilty before U.S. Magistrate Judge Gary R. Jones to one count of obstruction of justice.
According to court documents, on the night of Sept. 24, 2009, Abby Hogan’s husband, James Hogan, an employee at the U.S. Consulate in Curacao, a Caribbean island that was part of the Netherlands Antilles, left his home on foot and subsequently disappeared. In the early hours of Sept. 25, 2009, James Hogan called his wife and spoke for approximately three minutes. The next day, when James Hogan failed to report to work, the U.S. government and Dutch and Antillean law enforcement launched an island-wide search and opened an investigation into Hogan’s disappearance. On Sept. 25, 2009, a diver located James Hogan’s blood-stained clothing on a local beach.
According to evidence submitted in Abby Hogan’s sentencing hearing, she repeatedly provided false information to U.S. law enforcement about the time period before James Hogan’s disappearance and withheld relevant information. Abby Hogan initially told investigators that, before his disappearance, she and her husband had an argument. She subsequently modified that statement and claimed that there had been no argument, just a minor disagreement over her husband’s next assignment for the State Department. Abby Hogan further told U.S. law enforcement agents that James Hogan had been in a “good mood” prior to leaving for his walk on the evening of his disappearance. She repeatedly denied that there had been any marital problems or that her husband had been upset or depressed in any way. Abby Hogan further stated that she could not remember the full three-minute conversation before her husband disappeared because she was sound asleep when her husband called. She claimed she fell back asleep after the call, and did not awake until the following morning. In fact, all of these statements were false, as established by the deleted emails and other computer forensic evidence , which was submitted to the court.
According to court documents, after law enforcement interviews, between Sept. 30, 2009, and Jan. 15, 2010, Abby Hogan deleted more than 300 emails from her email account. These emails contained information that Abby Hogan knew was relevant to specific questions she had been asked by U.S. law enforcement. The emails also contained information that she had either previously misrepresented or knowingly omitted during her interviews with law enforcement, including that she was engaged in an extramarital affair; the night James Hogan disappeared, the couple had argued, and he left the house angry and upset; and that she did not want law enforcement to know what had happened that evening.
The case was prosecuted by Senior Trial Attorney Teresa Wallbaum of the Criminal Division’s Human Rights and Special Prosecutions Section and Assistant U.S. Attorney Frank Williams for the Northern District of Florida. The Criminal Division’s Office of International Affairs provided assistance. The case was investigated by DSS and the FBI’s Miami Field Office and Legal Attaché Office in Bridgetown, Barbados. Assistance was also provided by Curacao law enforcement authorities.
Department of Justice and National Institute of Standards and Technology Announce Launch of National Commission on Forensic ScienceRead the Press Release
The U.S. Department of Justice and the U.S. Department of Commerce’s National Institute of Standards and Technology (NIST) announced today the establishment of a National Commission on Forensic Science as part of a new initiative to strengthen and enhance the practice of forensic science.
The National Commission on Forensic Science will be composed of approximately 30 members, bringing together forensic science service practitioners, academic researchers, prosecutors, defense attorneys, judges and other relevant stakeholders to develop policy recommendations for the Attorney General. The commission will consider guidance on practices for federal, state and local forensic science laboratories developed by groups of forensic science practitioners and academic researchers administered by NIST.
“Forensic science is an essential tool in the administration of justice and needs to be continually evaluated as science progresses,” said Deputy Attorney General James M. Cole. “Forensic science helps identify perpetrators, convict the guilty, exonerate the innocent, and protect public safety. This initiative is led by the principle that scientifically valid and accurate forensic analysis strengthens all aspects of our justice system.”
“The Department of Justice and the National Institute of Standards and Technology have a history of successful collaboration,” said Under Secretary of Commerce for Standards and Technology and NIST Director Patrick Gallagher. “Through this initiative, we will work even more closely with the forensic science community to strengthen the forensic science system.”
The commission will have responsibility for developing guidance concerning the intersections between forensic science and the courtroom and developing policy recommendations, including uniform codes for professional responsibility and requirements for training and certification.
The new initiative provides a framework for coordination across forensic disciplines under federal leadership, with state and local participation. The Department of Justice, through its involvement in the commission, will take an active role in developing policy recommendations and coordinating implementation. The NIST-administered guidance groups will develop and propose discipline-specific practice guidance that will become publicly available and be considered for endorsement by the commission and the Attorney General. This coordinated effort will help to standardize national guidance for forensic science practitioners. Additionally, NIST will continue to develop methods for forensic measurements and validate select existing forensic science standards.
Specific criteria for membership will be announced in an upcoming Federal Register notice, and applicants will have 30 days from the publication of the notice to submit their applications.
As a non-regulatory agency of the U.S. Department of Commerce, NIST promotes U.S. innovation and industrial competitiveness by advancing measurement science, standards and technology in ways that enhance economic security and improve our quality of life. To learn more about NIST, visit www.nist.gov .
U.S. Trustee Program’s Settlement with Financial Adviser Includes Monetary Remedies, Independent MonitorRead the Press Release
WASHINGTON – The U.S. Trustee Program has filed in bankruptcy court a national settlement with financial adviser Capstone Advisory Group LLC in the bankruptcy case of GSC Group, Inc. If approved by the Bankruptcy Court for the Southern District of New York, the proposed settlement will resolve the U.S. Trustee’s allegations that Capstone failed to make accurate and complete disclosures to support the bankruptcy court’s approval of its employment in the case. In particular, the U.S. Trustee alleged that Capstone made inaccurate representations about its relationship with a contractor assigned to lead its engagement and to perform work in the case.
Under the proposed settlement, Capstone will pay $1 million; waive an additional success fee of $2.75 million; adopt policies and procedures approved by an independent monitor to ensure accurate and complete disclosure, including with respect to employment of contractors and conflicts of interest; and undergo compliance reviews by the monitor for two years.
If approved by the bankruptcy court, the settlement will mark the first time the U.S. Trustee Program has obtained relief that includes an independent monitor’s review of a professional firm.
“This important settlement shows that the U.S. Trustee Program will take vigorous enforcement action when we uncover evidence that experienced professional firms have failed to satisfy their bedrock obligations to provide true and complete facts to the U.S. Trustee and the bankruptcy court,” stated Clifford J. White III, Director of the Executive Office for U.S. Trustees. “I commend Capstone for recognizing the seriousness of this matter by voluntarily accepting significant financial consequences and subjecting itself to independent review to ensure that similar conduct does not recur.”
Director White also commended U.S. Trustee Tracy Hope Davis for bringing the original action in the bankruptcy court in Manhattan, as well as attorneys who worked on the case, including Trial Attorney Andrea Schwartz of the U.S. Trustee’s Office in Manhattan and Trial Attorney Carole Ryczek of the U.S. Trustee’s Office in Madison, Wis.
The USTP also reached agreement with the contractor and his affiliated companies.
The case is In re GSC Group Inc., U.S. Bankruptcy Court, Southern District of New York, No. 10-14653.
Contact:Jane Limprecht, Public Information Officer
Executive Office for U.S. Trustees
(202) 305-7411Transocean Pleads Guilty, Is Sentenced to Pay $400 Millionin Criminal Penalties for Criminal ConductLeading to Deepwater Horizon DisasterRead the Press Release
Transocean Deepwater Inc. pleaded guilty today to a violation of the Clean Water Act (CWA) for its illegal conduct leading to the 2010 Deepwater Horizon disaster, and was sentenced to pay $400 million in criminal fines and penalties, Attorney General Holder announced today.
In total, the amount of fines and other criminal penalties imposed on Transocean are the second-largest environmental crime recovery in U.S. history – following the historic $4 billion criminal sentence imposed on BP Exploration and Production Inc. in connection with the same disaster.
“Transocean’s guilty plea and sentencing are the latest steps in the department’s ongoing efforts to seek justice on behalf of the victims of the Deepwater Horizon disaster,” said Attorney General Holder. “Most of the $400 million criminal recovery – one of the largest for an environmental crime in U.S. history – will go toward protecting, restoring and rebuilding the Gulf Coast region.”
“The Deepwater Horizon explosion was a senseless tragedy that could have been avoided,” said Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division. “Eleven men died, and the Gulf’s waters, shorelines, communities and economies suffered enormous damage. With today’s guilty plea, BP and Transocean have now both been held criminally accountable for their roles in this disaster.”
Transocean’s guilty plea was accepted, and the sentence was imposed, by U.S. District Judge Jane Triche Milazzo of the Eastern District of Louisiana. During the guilty plea and sentencing proceeding, Judge Milazzo found, among other things, that the sentence appropriately reflects Transocean’s role in the offense conduct, and that the criminal payments directed to the National Academy of Sciences and National Fish and Wildlife Foundation are appropriately designed to help remedy the harm to the Gulf of Mexico caused by Transocean’s actions. The judge also noted that the fines and five year probationary period provide just punishment and adequate deterrence.
Transocean pleaded guilty to an information, previously filed in federal court in New Orleans, charging the company with violating the CWA. During the guilty plea proceeding today, Transocean admitted that members of its crew onboard the Deepwater Horizon, acting at the direction of BP’s well site leaders, known as “company men,” were negligent in failing to investigate fully clear indications that the Macondo well was not secure and that oil and gas were flowing into the well.
The criminal resolution is structured to directly benefit the Gulf region. Under the order entered by the court pursuant to the plea agreement, $150 million of the $400 million criminal recovery is dedicated to acquiring, restoring, preserving and conserving – in consultation with appropriate state and other resource managers – the marine and coastal environments, ecosystems and bird and wildlife habitat in the Gulf of Mexico and bordering states harmed by the Deepwater Horizon oil spill. This portion of the criminal recovery will also be directed to significant barrier island restoration and/or river diversion off the coast of Louisiana to further benefit and improve coastal wetlands affected by the spill. An additional $150 million will be used to fund improved oil spill prevention and response efforts in the Gulf through research, development, education and training.
Transocean was also sentenced, according to the plea agreement, to five years of probation – the maximum term of probation permitted by law.
A separate proposed civil consent decree, which resolves the United States’ civil CWA penalty claims, imposes a record $1 billion civil Clean Water Act penalty, and requires significant measures to improve performance and prevent recurrence, is pending before U.S. District Judge Carl J. Barbier of the Eastern District of Louisiana.
The charges and allegations pending against individuals in related cases are merely accusations, and those individuals are considered innocent unless and until proven guilty.
The guilty plea and sentencing announced today are part of the ongoing criminal investigation by the Deepwater Horizon Task Force into matters related to the April 2010 Gulf oil spill. The Deepwater Horizon Task Force, based in New Orleans, is supervised by Assistant Attorney General Breuer and led by Deputy Assistant Attorney General John D. Buretta, who serves as the director of the task force. The task force includes prosecutors from the Criminal Division and the Environment and Natural Resources Division of the Department of Justice; the U.S. Attorney’s Office for the Eastern District of Louisiana, as well as other U.S. Attorneys’ Offices; and investigating agents from: the FBI; Environmental Protection Agency, Criminal Investigative Division; Environmental Protection Agency, Office of Inspector General; Department of Interior, Office of Inspector General; National Oceanic and Atmospheric Administration, Office of Law Enforcement; U.S. Coast Guard; U.S. Fish and Wildlife Service; and the Louisiana Department of Environmental Quality.
This case was prosecuted by Deepwater Horizon Task Force Director John D. Buretta, Deputy Directors Derek A. Cohen and Avi Gesser, and task force prosecutors Richard R. Pickens II, Scott M. Cullen, Colin Black and Rohan Virginkar.
Georgia Woman Admits to Taking Bribes for<br /> the Award of Government ContractsRead the Press Release
A former employee at the Marine Corps Logistics Base Albany pleaded guilty today to receiving bribes related to the award of contracts for machine products, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Attorney Michael J. Moore for the Middle District of Georgia.
Michelle Rodriguez, 32, of Albany, Ga., pleaded guilty before U.S. District Judge W. Louis Sands in the Middle District of Georgia to one count of bribery of a public official.
During her guilty plea, Rodriguez, who worked as a supply technician in the Maintenance Center Albany (MCA), admitted to participating in a scheme to award contracts for machine products to companies operated by Thomas J. Cole and Frederick Simon, both of whom pleaded guilty to bribery charges in January 2013.
According to court documents, the MCA is responsible for rebuilding and repairing ground combat and combat support equipment, much of which has been used in military missions in Afghanistan, Iraq and other parts of the world. To accomplish the scheme, Rodriguez would transmit bid solicitations to Simon by fax or email, usually following up with a text message specifying how much the company seeking the contract should bid. Simon, with Cole’s knowledge, would then bid the amount specified by Rodriguez on each order, which was normally higher than fair market value. Rodriguez was paid $75.00 cash per order. Rodriguez admitted during today’s hearing that she awarded Cole and Simon’s companies nearly 1,300 machine product orders, all in exchange for bribes.
Rodriguez also admitted that in 2011, she began routing some orders through a second company, owned by Cole, because the volume of orders MCA placed with the first company was so high. Rodriguez admitted receiving approximately $161,000 in bribes during the nearly two-year scheme. Cole and Simon previously admitted to personally receiving approximately $209,000 and $74,500 in proceeds from the scheme, respectively. Rodriguez, Cole and Simon all conceded that the total loss to the Department of Defense from overcharges associated with the machine product orders placed during the scheme was approximately $907,000.
At sentencing, Rodriguez faces a maximum potential penalty of 15 years in prison and a fine of twice the gross gain or loss from the offense. As part of her plea agreement with the United States, Rodriguez agreed to forfeit the bribe proceeds she received from the scheme, as well as to pay full restitution to the Department of Defense. The plea agreement also required her to resign her position at the MCA. Sentencing is scheduled for April 25, 2013.
The case is being prosecuted by Trial Attorneys Richard B. Evans and J.P. Cooney of the Justice Department’s Criminal Division Public Integrity Section and Assistant U.S. Attorney K. Alan Dasher of the Middle District of Georgia. The case is being investigated by the Naval Criminal Investigative Service, with assistance from the Dougherty County District Attorney’s Office Economic Crime Unit and the Department of Defense, Office of Inspector General Defense Criminal Investigative Service.
Former Executives of Stanford Financial Group Entities<br /> Sentenced to 20 Years in Prison for Roles in Fraud SchemeRead the Press Release
Gilbert T. Lopez Jr., the former chief accounting officer of Stanford Financial Group Company, and Mark J. Kuhrt, the former global controller of Stanford Financial Group Global Management, were each sentenced today to 20 years in prison for their roles in helping Robert Allen Stanford perpetrate a fraud scheme involving Stanford International Bank (SIB). Both were convicted by a Houston federal jury on Nov. 19, 2012.
The sentences were announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Kenneth Magidson of the Southern District of Texas; FBI Assistant Director Kevin Perkins of the Criminal Investigative Division; Assistant Secretary of Labor for the Employee Benefits Security Administration Phyllis C. Borzi; Chief Postal Inspector Guy J. Cottrell; and Special Agent in Charge Lucy Cruz of Internal Revenue Service-Criminal Investigation.The trial against Lopez and Kuhrt spanned five weeks. After approximately three days of deliberations, the jury found both Lopez, 70, and Kuhrt, 40, both of Houston, guilty of 10 of 11 counts in the indictment. Each defendant was convicted of one count of conspiracy to commit wire fraud and nine counts of wire fraud. Each was found not guilty on one wire fraud count. Both defendants were taken into custody immediately following the jury’s verdict.
In addition to the prison terms, U.S. District Judge David Hittner, who presided over the trial, sentenced Lopez and Kuhrt to serve three years of supervised release and ordered Lopez to pay a $25,000 fine. At today’s hearing, Judge Hittner also found that both defendants obstructed justice by committing perjury at trial.
Stanford, who was previously convicted in a separate trial, illegally used billions of dollars of SIB’s assets to fund his personal business ventures, to live a lavish lifestyle and for other improper purposes. He was later sentenced to 110 years in prison. James M. Davis, Stanford’s chief financial officer – who pleaded guilty and cooperated with the government soon after SIB was shut down in February 2009 and testified at both Stanford’s trial and the trial of Lopez and Kuhrt – was sentenced to 60 months in prison for his role in the scheme.
The evidence presented at Lopez and Kuhrt’s trial established that they were aware of and tracked Stanford’s misuse of SIB’s assets, kept the misuse hidden from the public and from almost all of Stanford’s other employees and worked behind the scenes to prevent the misuse from being discovered. They also helped Stanford falsely represent to SIB customers during the economic crash in late 2008 that Stanford had infused hundreds of millions of dollars into SIB when he had not. As part of that effort, Lopez and Kuhrt helped design a fraudulent real estate transaction that involved falsely inflating parcels of land purchased at $63.5 million to a purported value of $3.2 billion.
The investigation was conducted by the FBI, U.S. Postal Inspection Service, IRS-CI and the U.S. Department of Labor, Employee Benefits Security Administration. The case was prosecuted by Deputy Chief Jeffrey Goldberg and Trial Attorney Andrew Warren of the Criminal Division’s Fraud Section, and by Assistant U.S. Attorney Jason Varnado of the Southern District of Texas.
Antiques Dealer Sentenced in New York City for Crimes Relating to Illegal Trafficking of Endangered Rhinoceros HornsRead the Press Release
David Hausman, an antiques dealer in Manhattan, was sentenced today in Manhattan federal court to six months in jail for obstruction of justice and creating false records in connection with illegal rhinoceros horn trafficking, announced Ignacia S. Moreno, Assistant Attorney General for the Environment and Natural Resources Division of the Department of Justice, and Preet Bharara, U.S. Attorney for the Southern District of New York.
In addition to the jail term, the judge sentenced Hausman, 67, of New York, N.Y., to pay a $10,000 fine to the Lacey Act Reward Fund and $18,000 to the Rhino Tiger Conservation Fund. Hausman was also sentenced to one year of supervised release to follow his sentence and ordered to pay a $200 special assessment fee.
In his July 2012 guilty plea, Hausman admitted that he committed these offenses while holding himself out to the U.S. Fish & Wildlife Service (FWS) as an antiques expert who purportedly wanted to help the agency investigate rhinoceros horn trafficking. Hausman was arrested in February 2012 as part of “Operation Crash,” a nationwide, multi-agency crackdown on those involved in the black market trade of endangered rhinoceros horn.
“Mr. Hausman’s blatant deception of officers conducting a federal investigation was illegal and reprehensible,” said Assistant Attorney General Moreno. “He posed as someone who was protecting this endangered species when he was really obtaining and using inside information to further the illegal trade in black rhino horns. We will vigorously prosecute all those who violate the wildlife protection laws enacted by Congress to protect endangered species like the black rhinoceros from extinction.”“With today’s sentence, David Hausman now knows that trafficking in endangered, and legally protected species, and obstructing law enforcement’s ability to do its job have grave consequences,” said U.S. Attorney Bharara.”
“Rhino populations across the globe are being decimated by poachers seeking to meet rising demand for rhino horn for ceremonial purposes and as a traditional ‘medicine,’ despite the fact that it has no demonstrable medicinal benefits,” said U.S. Fish & Wildlife Service Director Dan Ashe. “As this week's arrests and sentencing demonstrate, we continue to work with the Department of Justice and international law enforcement agencies to do everything we can to shut this trafficking down and hold perpetrators responsible under the law.”
Background on Operation Crash
Rhinoceros are an herbivore species of prehistoric origin and one of the largest remaining mega-fauna on earth. They have no known predators other than humans. All species of rhinoceros are protected under United States and international law, and all black rhinoceros species are endangered.
Since 1976, trade in rhinoceros horn has been regulated under the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES), a treaty signed by over 170 countries around the world to protect fish, wildlife and plants that are or may become imperiled due to the demands of international markets. Nevertheless, the demand for Rhinoceros horn and black market prices have skyrocketed in recent years due to the value that some cultures have placed on ornamental carvings, good luck charms or alleged medicinal purposes, leading to a decimation of the global rhinoceros population.
Operation Crash is a continuing investigation being conducted by the Department of the Interior’s FWS in coordination with other federal and local law enforcement agencies including U.S. Immigration and Customs Enforcement’s Homeland Security Investigations. A “crash” is the term for a herd of rhinoceros. Operation Crash is an ongoing effort to detect, deter and prosecute those engaged in the illegal killing of rhinoceros and the unlawful trafficking of rhinoceros horns.
Hausman’s OffensesAccording to the information, plea agreement and statements made during court proceedings:
In December 2010, Hausman – while purporting to help the government crack down on illegal rhinoceros trading – advised FWS that the taxidermied head of a black rhinoceros containing two horns had been illegally sold by a Pennsylvania auction house. Upon learning that the sale was not finalized, Hausman covertly purchased the rhinoceros mount himself, using a “straw buyer” to conceal that he was the true purchaser because federal law prohibits interstate trafficking in endangered species. Hausman instructed the straw buyer not to communicate with him about the matter by email to avoid creating a paper trail that could be followed by law enforcement. After the purchase was completed, Hausman directed the straw buyer to remove the horns and mail them to him. He then made a realistic set of fake horns using synthetic materials and directed the straw buyer to attach them on the rhinoceros head in order to deceive law enforcement in the event that they conducted an investigation. After his arrest, Hausman contacted the straw buyer and they agreed that the rhinoceros mount should be burned or concealed.
In a second incident, in September 2011, Hausman responded to an internet offer to sell a (different) taxidermied head of a black rhinoceros containing two horns. Unbeknownst to Hausman, the on-line seller was an undercover federal agent. Before purchasing the horns on Nov. 15, 2011, Hausman directed the undercover agent to send him an email falsely stating that the mounted rhinoceros was over 100 years old, even though the agent had told him that the rhinoceros mount was only 20 to 30 years old. There is an antique exception for certain trade in rhinoceros horns that are over 100 years old. By falsifying the age of the horns, Hausman sought to conceal his illegal conduct. Hausman also insisted on a cash transaction and told the undercover agent not to send additional emails so there would be no written record. After buying the black rhinoceros mount at a truck stop in Princeton, Ill., agents followed Hausman and observed him sawing off the horns in a motel parking lot.
At the time of his arrest, FWS agents seized four rhinoceros heads from Hausman’s apartment as well as six black rhinoceros horns – two of which were the horns he was seen sawing off in the parking lot – numerous carved and partially carved rhinoceros horns, fake rhinoceros horns and $28,000 in cash.
U.S. Attorney Bharara and Assistant Attorney General Moreno commended FWS and the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations in Newark for their outstanding work in this investigation.
The case is being handled by the U.S. Attorney’s Complex Frauds Unit and the Environmental Crimes Section of the U.S. Department of Justice’s Environment and Natural Resources Division. Assistant U.S. Attorney Janis M. Echenberg and Richard A. Udell, a Senior Trial Attorney with the Justice Department’s Environmental Crimes Section, are in charge of the prosecution.
Ohio Federal Court BarsAppraiser of Historic-Preservation EasementsRead the Press Release
A federal court in Cleveland has barred MAI-designated real estate appraiser Michael Ehrmann and his firm, Jefferson & Lee Appraisals Inc., from preparing property appraisals for federal tax purposes, the Justice Department announced today. Judge Dan Aaron Polster of the U.S. District Court for the Northern District of Ohio signed the civil injunction order against Ehrmann and Jefferson & Lee Appraisals. The defendants consented to the injunction without admitting the allegations against them.
Federal law allows a taxpayer in certain limited circumstances to claim a charitable deduction for the value of a conservation easement donated to a qualified organization. The easement’s value must be determined by a qualified appraiser. According to the government complaint, Ehrmann’s appraisals repeatedly overstated the value of conservation easements placed on historic properties, including the Book Cadillac Hotel in Detroit and the Powerhouse Building in the Flats District of Cleveland.
In its complaint, the government contends that Ehrmann distorted data and provided misinformation or unsupported personal opinions to get artificially high values for conservation-easement donations. The complaint also alleges that “Ehrmann knows that his clients will use the inflated values provided in his appraisals to claim overstated charitable contribution deductions.” According to the government complaint, the amount of improper tax deductions attributable to Ehrmann’s flawed appraisals could reach hundreds of millions of dollars.
In 2011, in the U.S. District Court for the District of Columbia, the Justice Department obtained an injunction against the Trust for Architectural Easements, formerly known as the National Architectural Trust, barring it from engaging in abusive practices relating to the valuation and donation process for historic-conservation easements. The Internal Revenue Service has listed abuse of charitable deductions as one of its “Dirty Dozen” tax scams . The Justice Department has obtained injunctions against hundreds of tax-return preparers and tax-fraud promoters in the past decade. Information about these cases is available on the Justice Department website .
Related Materials:
United States v. Michael Ehrmann, et al.
Agreed Order of Permanent Injunction (PDF)Northern Virginia Therapy Provider to Pay $700,000<br /> to Resolve False Claims Act AllegationsRead the Press Release
Fairfax, Va.-based skilled nursing facility Fairfax Nursing Center (FNC) and its owners have agreed to pay $700,000 to resolve allegations that they violated the False Claims Act by knowingly submitting or causing the submission to Medicare of false claims for non-reimbursable rehabilitation therapy services, the Justice Department announced today.
The settlement resolves claims that FNC provided excessive, medically unnecessary, or otherwise non-reimbursable physical, occupational, and speech therapy services to 37 Medicare beneficiaries serviced by FNC between January 2007 and December 2010. The United States alleged that the rehabilitation therapy services provided by FNC to these beneficiaries were not reasonable and necessary for the treatment of their condition. Specifically, the United States alleged that the therapy services were often excessive, duplicative, performed without clear goals or direction, and, in some instances, performed primarily to capture higher reimbursement rates.
“Today’s settlement is another example of the Department’s efforts to hold skilled nursing facilities accountable for the rehabilitation therapy services they deliver to some of the most vulnerable in our society,” said Stuart F. Delery, Principal Deputy Assistant Attorney General for the Civil Division of the Department of Justice. “The provision of excessive and medically unnecessary therapy services will not be tolerated.”
“Medicare fraud takes many forms and arises in various segments of health care,” said U.S. Attorney Neil H. MacBride. “We continue to work toward recovery of money lost to overbillings to Medicare.”
This resolution is part of the government’s emphasis on combating health care fraud and another step for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced by Attorney General Eric Holder and Kathleen Sebelius, Secretary of the Department of Health and Human Services in May 2009. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in that effort is the False Claims Act, which the Justice Department has used to recover nearly $10.2 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department’s total recoveries in False Claims Act cases since January 2009 are over $14 billion.
The allegations settled today arose from a lawsuit filed by two former FNC therapists and one former contract therapist under the qui tam, or whistleblower provisions, of the False Claims Act. Under the False Claims Act, private citizens can bring suit on behalf of the United States and share in any recovery. The whistleblowers in this case will receive, collectively, $122,500 of the recovery. The lawsuit is captioned as United States of America & Commonwealth of Virginia ex rel. Christine Ribik, Nadine Kelly, & Stephanie Beauregard v. Fairfax Nursing Center, Inc., et al. No. 1:11-cv-496 (E.D. Va.).
The case was handled by the Department of Justice’s Civil Division, the U.S. Attorney’s Office for the Eastern District of Virginia, the Office of the Inspector General of the U.S. Department of Health and Human Services, and the Medicaid Fraud Control Unit of the Commonwealth of Virginia Attorney General’s Office. The claims settled by this agreement are allegations only; there has been no determination of liability.
Members of Rhino Smuggling Ring Arrested and ChargedRead the Press Release
Three people have been charged this week in Newark, Miami and New York City with wildlife smuggling and related charges for their alleged roles in an international rhino horn smuggling ring, the Justice Department announced today. The arrests and charges are the result of “Operation Crash”, a nationwide effort led by the U.S. Fish & Wildlife Service (FWS) and the Justice Department to investigate and prosecute those involved in the black market trade of endangered rhinoceros horns.
Federal grand juries in Newark, N.J., and Miami have indicted Zhifei Li, in the international smuggling of rhinoceros horns. Shusen Wei, a 44 year old Chinese business executive and an associate of Li, has also been charged with offering to bribe a federal agent in the Li case. Qing Wang was charged today in a related criminal complaint in federal court in the Southern District of New York for his role in smuggling libation cups carved from rhinoceros horns from New York to Li via Hong Kong.
According to the indictment filed in Newark on Feb. 11, 2013, Li, a 28 year-old Chinese national, conspired to smuggle more than 20 raw rhinoceros horns from the United States to Hong Kong in 2011 and 2012. Li wired hundreds of thousands of dollars over at least a year to a co-conspirator in the United States to fund purchases of rhinoceros horns. Li’s co-conspirator smuggled the rhino horns in porcelain vases and mailed them to Hong Kong and China to a person other than Li, in an effort to evade detection by U.S. officials. Li and his co-conspirator bought many of the horns in New Jersey from other members of the conspiracy. Li was arrested in January on charges previously filed in New Jersey.
Li also was indicted on Feb. 12, 2013, in Miami on wildlife trafficking and smuggling charges. According to court records and government statements made in court, shortly after arriving in Florida in January 2013 for the Original Miami Beach Antique Show, Li purchased two endangered black rhinoceros horns from an undercover U.S. Fish & Wildlife Service agent in a Miami Beach hotel room for $59,000. Li asked if the undercover officer could procure additional rhinoceros horns and mail them to his company in Hong Kong.Also arrested on a related criminal complaint filed in Miami was Shusen Wei, a Chinese business executive, who also was attending the antique show and sharing a hotel room with Li. According to documents filed in court in Miami, Wei was interviewed by agents after Li’s arrest and admitted to knowing about Li’s smuggling activities and to purchasing rhinoceros carvings from Li that apparently had been purchased in and smuggled from the United States. After being served with a grand jury subpoena to appear in New Jersey, Wei left Miami for New York en route to China. Prior to leaving Miami, Wei allegedly asked an undercover informant to invite a FWS special agent out to dinner in Miami and offer her money to assist Li. After a series of recorded phone calls and text messages, Wei was arrested as he attempted to board a flight bound for China at JFK International Airport in New York on Saturday, Feb. 3, 2013, on charges of bribing a federal official. According to documents filed in court, Wei proposed that the undercover informant offer the agent as much as $10,000.
Qing Wang is scheduled to appear in court today to face charges in a criminal complaint in the Southern District of New York for his role in smuggling libation cups carved from rhinoceros horns from New York to Li in Hong Kong. According to documents unsealed today, Wang was one of several that purchased items in the United States for Li. In China, there is a tradition dating back centuries of intricately carved rhinoceros horn cups . Drinking from such a cup was believed to bring good health and such carvings are highly prized by collectors. Wang is alleged to have been smuggling rhinoceros horn cups as well as ivory carvings to Li in Hong Kong.
An indictment or criminal complaint contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty.
Rhinoceros are an herbivore species of prehistoric origin and one of the largest remaining mega-fauna on earth. They have no known predators other than humans. All species of rhinoceros are protected under United States and international law, and all black rhinoceros species are endangered. Since 1976, trade in rhinoceros horn has been regulated under the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES), a treaty signed by more than 175 countries around the world to protect fish, wildlife and plants that are or may become imperiled due to the demands of international markets. Nevertheless, the demand for rhinoceros horn and black market prices have skyrocketed in recent years due to the value that some cultures have placed on ornamental carvings, good luck charms or alleged medicinal purposes, leading to a decimation of the global rhinoceros population. As a result, rhino populations have declined by more than 90 percent since 1970. South Africa, for example, has witnessed a rapid escalation in poaching of live animals, rising from 13 in 2007 to more than 618 in 2012.
Operation Crash (named for the term used to describe a herd of rhinoceros) is an ongoing multi-agency effort to detect, deter and prosecute those engaged in the illegal killing of rhinoceros and the unlawful trafficking of rhinoceros horns. The investigation resulting in the charges announced today has been conducted by the Special Investigations Unit of the FWS Office of Law Enforcement, with assistance from the Department of Homeland Security. The Li case is being prosecuted by the U.S. Attorney’s Office of the District of New Jersey by Assistant U.S. Attorney Kathleen O’Leary. The Wei case is being prosecuted by Assistant U.S. Attorney Tom Watts-FitzGerald in the Southern District of Florida. The Wang case is being prosecuted by Assistant U.S. Attorney Janis Echenberg in the U.S. Attorney’s Office of the Southern District of New York. Senior Trial Attorney Richard A. Udell of the Environmental Crimes Section of the U.S. Department of Justice is assisting in and coordinating all of the prosecutions. Additional support has been provided by the U.S. Attorney’s Office in the Eastern District of New York.
Georgia Man Admits Taking Bribes to Allow $1 Million Theft<br /> of Government Equipment from Marine BaseRead the Press Release
A retired employee of the Marine Corps Logistics Base Albany (MCLB-Albany) pleaded guilty today to receiving bribes in exchange for allowing heavy equipment to be stolen from the base for resale, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Attorney Michael J. Moore for the Middle District of Georgia.
Shelby C. Janes, 67, of Albany, Ga., pleaded guilty before U.S. District Judge W. Louis Sands in the Middle District of Georgia to one count of bribery of a public official.
During his guilty plea, Janes, the former civilian inventory control manager of the distribution management center at MCLB-Albany, admitted to participating in a scheme in which he assisted an individual, referred to in court documents as “Person A,” in stealing heavy equipment – such as cranes, bulldozers and front-end loaders – from the base. Person A, the owner of a commercial trucking business that was routinely contracted by the MCLB’s Defense Logistics Agency, then arranged to sell the equipment to private purchasers.
According to court documents, while working at the distribution management center, Janes was responsible for supervising a number of employees in the inventorying of obsolete equipment returning from the Fleet Marine Corps. This equipment was sent to MCLB-Albany for one of two purposes: to be demilitarized and disposed of through eventual sale or destruction, or to be rehabilitated, repaired and redistributed to the Fleet Marine Corps. To accomplish the theft scheme, Janes and one of his employees, referred to in court documents as “Public Official A,” facilitated the theft of the equipment, including by letting the equipment be driven off the base. Janes admitted that to facilitate the unlawful removal of the equipment, he typically prepared a false DD Form 1348 authorizing the Defense Logistics Agency to release the equipment to Person A, and that the equipment was then sold to private purchasers for tens of thousands of dollars.
Janes also admitted that he received payments from Person A after the sale of the stolen equipment, often delivered to him by Public Official A on behalf of Person A in the form of a check or cash, totaling approximately $98,500 during the approximately 15-month scheme. Janes admitted that the total loss to the Department of Defense from the theft of government equipment was approximately $1,075,000.
At sentencing, Janes faces a maximum potential penalty of 15 years in prison and a fine of twice the gain or loss from the offense. As part of his plea agreement with the United States, Janes agreed to forfeit the bribe proceeds he received from the scheme, as well as to pay full restitution to the Department of Defense. A sentencing date has not yet been set.
The case is being prosecuted by Trial Attorneys Richard B. Evans and J.P. Cooney of the Justice Department’s Criminal Division Public Integrity Section and Assistant U.S. Attorney K. Alan Dasher of the Middle District of Georgia. The case is being investigated by the Naval Criminal Investigative Service, with assistance from the Dougherty County District Attorney’s Office Economic Crime Unit and the Department of Defense, Office of Inspector General Defense Criminal Investigative Service.
Former Oklahoma Jail Superintendent and Assistant Jail Superintendent Indicted on Multiple Civil Rights OffensesRead the Press Release
A federal grand jury in Muskogee, Okla., has indicted Raymond A. Barnes, 42, and Christopher A. Brown, 31, the former jail superintendent and assistant jail superintendent, respectively, of the Muskogee County Jail (MCJ) on multiple counts of civil rights offenses related to allegations of excessive force on inmates at MCJ on or between August 2009 and May 2011. Brown is also charged with making material false statements to the FBI.
The indictment charges both Barnes and Brown with one count of conspiring to violate the rights of inmates housed at MCJ by assaulting inmates themselves or by directing other jailers employed by MCJ to do so. Specifically, the indictment alleges that as part the conspiracy, the defendants did the following: unjustifiably strike, assault, harm and physically punish inmates at MCJ who were restrained, compliant and not posing a physical threat to anyone; organize “meet and greets,” whereby jailers would scare, punish and harm incoming inmates from neighboring counties by throwing and slamming the handcuffed inmates to the ground upon their arrival at the MCJ; threaten to fire MCJ employees if they reported abusive behavior directly to the sheriff or to outside law enforcement authorities; require and encourage MCJ jailers to write incident reports that falsely justified uses of force and contained misleading or inaccurate accounts of what had occurred when force was used; and perpetuate an environment within the MCJ that allowed unlawful beatings and assaults against inmates to continue indefinitely and without consequence.
The indictment further charges the defendants with aiding and abetting each other in violating the rights of two different inmates when the MCJ jailers slammed and threw the inmates to the ground while they were handcuffed. The indictment alleges that these offenses resulted in bodily injury.
Brown is additionally charged with one count of making material false statements to the FBI. According to the indictment, Brown falsely claimed that during “meet and greets,” when an inmate from an out-of-county jail arrives at MCJ, the inmate is ordered out of the transport vehicle, and then is “gently placed” on the ground. The indictment alleges that this was false in that the defendant knew at the time of his statement to the FBI that during “meet and greets,” when an inmate arrived from an out-out-county jail, the MCJ jailers routinely threw and slammed inmates to the ground even though the inmates were restrained and not posing a physical threat to anyone.
Barnes and Brown face a maximum penalty of 10 years for each of the three civil rights offenses. Brown faces a maximum penalty of five years for making material false statements to the FBI.
An indictment is merely an accusation, and the defendants are presumed innocent unless proven guilty.
This case is being investigated by the Muskogee Resident Agency of the Oklahoma City Division of the FBI and is being prosecuted by Fara Gold and Dana Mulhauser of the Civil Rights Division of the U.S. Department of Justice.
Former Muskogee, Oklahoma, Detention Officer Indicted for Making False Statements to the FBIRead the Press Release
A federal grand jury in Muskogee, Okla., has indicted Dennis Frisbie Jr., 32, a former detention officer at the Muskogee County Jail (MCJ), on one count of making material false statements to the FBI.
According to the indictment, Frisbie falsely reported to the FBI that he had been shot by an unknown individual on or about July 9, 2011, and that he believed he was shot because he had previously been interviewed and cooperated with the FBI regarding an investigation into matters at the MCJ. The indictment alleges that this statement was false because Frisbie knew at the time of his statement to the FBI that he had not been shot by an unknown individual because of his previous cooperation with the FBI.
Frisbie faces a maximum penalty of five years for making material false statements to the FBI.
An indictment is merely an accusation, and the defendant is presumed innocent unless proven guilty.
This case is being investigated by the Muskogee Resident Agency of the Oklahoma City Division of the FBI and is being prosecuted by Fara Gold and Dana Mulhauser of the Civil Rights Division of the U.S. Department of Justice.
Colorado Big Game Outfitter Sentenced to Prison for Six Lacey Act FeloniesRead the Press Release
Big game hunting outfitter Dennis Eugene Rodebaugh, 72, of Meeker, Colo., was sentenced in Denver today to 41 months in prison to be followed by three years supervised release for six felony counts of violating the Lacey Act, announced the Department of Justice Environment and Natural Resources Division, the U.S. Fish and Wildlife Service and Colorado Parks and Wildlife. District Judge Christine M. Arguello also sentenced Rodebaugh, to pay a $7,500 fine to the Lacey Act reward fund and $37,390 in restitution to the state of Colorado for the value of illegally taken elk and deer.
Rodebaugh was found guilty by a jury in September 2012 of aiding and abetting six violations of the Lacey Act by providing outfitting and guiding services from salt-baited tree-stands between 2005 and 2007. Beginning in 1988, Mr. Rodebaugh began offering multi-day elk and deer hunts to out-of-state clients on the White River National Forest through his outfitting business, called “D&S Guide and Outfitter,” for between $1,200 and $1,600.
Rodebaugh's assistant guide, Brian Kunz, was also sentenced today. He previously pleaded guilty to two misdemeanor counts of violating the Lacey Act while working for Rodebaugh. Based on his acceptance of responsibility and the government’s motion for downward departure based on his cooperation, the court sentenced Mr. Kunz to time served (one day) and one year of probation plus a $2,000 fine
Each spring and summer, Mr. Rodebaugh placed hundreds of pounds of salt as bait near the tree-stands from which his clients would hunt deer and elk with archery equipment. The placement and use of salt to aid in the taking of big game is unlawful in Colorado. The interstate sale of big game outfitting and guiding services for the unlawful taking of big game with the aid of bait constitutes a violation of the Lacey Act.
This case was investigated by Colorado Parks and Wildlife and the U.S. Fish and Wildlife Service.The case was prosecuted by Senior Trial Attorney J. Ronald Sutcliffe and Trial Attorney Mark Romley, of the Justice Department’s Environmental Crimes Section of the Environment and Natural Resources Division.
Statement by Attorney General Eric Holder on the Senate Passage of the Violence Against Women ActRead the Press Release
Attorney General Eric Holder issued the following statement today on the Senate passage of the Violence Against Women Act:
“I am extremely pleased the Senate has passed the reauthorization of the Violence Against Women Act, which contains important new provisions to expand access to justice for all victims of violence and strengthen law enforcement and prosecutorial tools to hold accountable those who commit these crimes. Notably, the tribal provisions included in the VAWA reauthorization and originally proposed by the Department of Justice, will close a significant jurisdictional gap that has left too many Native American women, precisely because they are Native American, exposed to violence for far too long. The status quo is simply unacceptable and the Senate has today acted courageously on behalf of our society’s most vulnerable, who deserve not only equal justice but also our unquestionable resolve to protect them. As the House of Representatives now moves to consider reauthorizing this critical law, I urge lawmakers to come together, as they have historically, to pass an improved and strengthened VAWA that continues its 18 years of progress towards ending the scourge of violence against all victims in our society.”
Leader of Professional Money Laundering Ring Pleads Guilty in TexasRead the Press Release
One of the leaders of an organization that laundered more than $20 million through “shell” business bank accounts pleaded guilty today in federal court in Houston, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Attorney Kenneth Magidson of the Southern District of Texas.
Enrique Morales, 42, of Houston and Guadalajara, Mexico, pleaded guilty today before U.S. District Judge Lee H. Rosenthal in the Southern District of Texas to conspiracy to commit money laundering and conspiracy to operate an unlicensed money transmitting business.
In August 2012, a federal grand jury in Houston indicted Morales and four of his co-defendants for their roles in operating a money transmitting business that provided professional money laundering services to narcotics traffickers as part of a scheme commonly referred to as “the Black Market Peso Exchange.” According to the indictment, from October 2009 to September 2011, the defendants placed U.S. currency obtained through the sale of drugs in the U.S. into bank accounts held in the name of shell companies, which were owned and operated by the defendants. The money was then transferred to different accounts in the U.S. and Mexico. In exchange, pesos were transferred to bank accounts owned by the defendants’ clients.
A total of five people arrested as part of this scheme have now been convicted. Willie Whitehurst, Fulton Smith and Anthony Foster, all from Houston and money couriers for the organization, previously pleaded guilty to conspiracy to commit money laundering and conspiracy to operate an unlicensed money transmitting business. Smith, 40, pleaded guilty yesterday, while Whitehurst, 44, and Foster, 47, pleaded guilty in January 2013. An office manager for the organization, Sarah Combs, 48, of Dickinson, Texas, previously pleaded guilty to conspiracy to operate an unlicensed money transmitting business.Foster, Whitehurst and Combs are scheduled for sentencing on May 9, 2013, while the sentencings of Smith and Morales are set for May 29, 2013. For the money laundering conspiracy, Morales, Whitehurst, Foster and Smith face up to 20 years in federal prison and a $500,000 fine, or twice the value of the property involved in the offense, whichever is greater. All five defendants face up to five years in federal prison and a fine of $250,000 for conspiracy to operate an unlicensed money transmitting business.
The case was investigated by the special agents with the Drug Enforcement Administration and Internal Revenue Service – Criminal Investigation. The case is being prosecuted by Assistant U.S. Attorney Ted Imperato of the Southern District of Texas and Keith Liddle, trial attorney in the Money Laundering and Bank Integrity Unit of the Criminal Division’s Asset Forfeiture and Money Laundering Section.The Money Laundering and Bank Integrity Unit investigates and prosecutes complex, multi-district and international criminal cases involving financial institutions and individuals who violate the money laundering statutes, the Bank Secrecy Act and other related statutes. The unit’s prosecutions generally focus on three types of violators: financial institutions, including their officers, managers and employees, whose actions threaten the integrity of the individual institution or the wider financial system; professional money launderers and gatekeepers who provide their services to serious criminal organizations; and individuals and entities engaged in using the latest and most sophisticated money laundering techniques and tools.
Justice Department Reaches Settlement with Virginia Dental Office to Stop HIV DiscriminationRead the Press Release
The Justice Department announced today that, as part of its Barrier-Free Health Care Initiative , it has reached a settlement with Woodlawn Family Dentistry, of Alexandria, Va., under the Americans with Disabilities Act (ADA). This is the third settlement addressing HIV discrimination by a medical provider reached by the Justice Department in three weeks.
The Justice Department found that Woodlawn Family Dentistry required a patient with HIV to schedule all future appointments as the last appointment of the day. The department determined that, because the patient has HIV, Woodlawn failed to offer him the same options and availability in scheduling future appointments as it offered to other people. The department further determined that there was no lawful reason why Woodlawn could not treat the patient at any time during normal business hours.
“Ensuring that people with HIV are treated equally and with dignity is critical, especially in the medical field,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “The ADA does not tolerate this type of discrimination and neither will the Justice Department.”
Under the settlement, Woodlawn must pay $7,000 to the patient and $3,000 in civil penalties. In addition, Woodlawn must train its staff on the ADA and develop and implement an anti-discrimination policy.
In the past two weeks, the department announced similar agreements with the Fayetteville Pain Center and the Castlewood Treatment Center to address HIV discrimination. All three settlements are part of the Department of Justice’s Barrier-Free Health Care Initiative, a partnership of the Civil Rights Division and U.S. Attorney’s offices across the nation, to target enforcement efforts on a critical area for individuals with disabilities. The initiative, launched on the 22nd anniversary of the ADA in July 2012, includes the participation of 40 U.S. Attorney’s offices. The division expects the initiative to address access to health care for people with HIV and those with hearing disabilities, as well as physical access to medical facilities. In 2012, the division and U.S. Attorneys offices reached two settlement agreements regarding access to medical care for people with HIV and four settlements regarding access to medical care for people with hearing disabilities. For more information on the Barrier Free Health Care Initiative visit www.ada.gov/usao-agreements.htm .
For more information on the ADA and HIV visit www.ada.gov/aids . Those interested in finding out more about these settlements or the obligations of public accommodations 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 its ADA website at www.ada.gov . ADA complaints may be filed by email to [email protected] .
Former Department of Defense Contractor Sentenced to 30 Months in Prison for Smuggling Kickback Proceeds from Afghanistan to the United StatesRead the Press Release
A former employee of a Department of Defense contracting company at Bagram Airfield, Afghanistan, was sentenced today to serve 30 months in prison for attempting to smuggle $150,000 in kickback proceeds he received for steering U.S. government subcontracts to an Afghan company, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Attorney Barry Grissom of the District of Kansas.
Donald Gene Garst, 51, of Topeka, Kan., was sentenced by U.S. District Judge Julie A. Robinson in Topeka. In addition to his prison term, Garst was sentenced to serve one year of supervised release and was ordered to pay a fine of $52,117. The department previously forfeited the $150,000 Garst had attempted to smuggle into the United States.
Garst pleaded guilty on Nov. 9, 2012, to a one-count information charging him with bulk cash smuggling. According to court documents, Garst was employed by a private U.S. company that was contracted by the U.S. government and its armed forces at Bagram Airfield from January 2009 to May 2011. Garst was involved in identifying, evaluating and monitoring subcontracts awarded to Afghan companies by his employer, and he used his position to meet executives of an Afghan construction company called Somo Logistics. Garst then entered into an agreement with the Afghans under which he would receive kickback payments on a contract-by-contract basis in return for treating Somo Logisitcs favorably in the contracting process.
In December 2010, Garst accepted a kickback for $60,000 on the first subcontract awarded to Somo Logistics. The subcontract was for the term lease of heavy equipment meant to be used for construction on Bagram Airfield. Garst hand-carried approximately $20,000 of the kickback proceeds into the United States, and he received the remainder via a series of structured wire transfers from Somo Logistics executives.
In May 2011, Garst accepted a $150,000 kickback for a second subcontract for the lease of heavy construction equipment. Garst shipped the $150,000 in cash to the United States, and his failure to declare the value of the shipment was discovered by law enforcement.
Garst had further agreed to receive $400,000 on a third subcontract, but his scheme was discovered by law enforcement before he could receive that payment.
This case is being prosecuted by Assistant U.S. Attorney Jared Maag and Trial Attorney Wade Weems of the Criminal Division’s Fraud Section. The case was investigated by Special Agents with the Army Criminal Investigations Division and the Defense Criminal Investigative Service, with assistance from the Special Inspector General for Afghanistan Reconstruction and the FBI.
Florida Man Pleads Guilty to Federal Election ViolationRead the Press Release
A Florida resident pleaded guilty today to causing a presidential campaign committee to make a false statement to the Federal Election Commission (FEC), announced Assistant Attorney General Lanny A. Breuer of the Justice Department?s Criminal Division and Robert O. Davis, Acting U.S. Attorney for the Northern District of Florida. Jay Odom, 56, of Destin, Fla., pleaded guilty before Senior U.S. District Judge Lacey A. Collier in the Northern District of Florida to one count of causing another to make false statements to the FEC. According to court documents, in approximately December 2007, Odom directly and indirectly solicited employees of his business entities and their family members to each make the maximum allowable contributions to the authorized campaign committee of a presidential candidate. The employees were encouraged to make these donations with the understanding that Odom would advance funds to or reimburse these individuals for their contributions. Odom admitted to both knowing that this activity was illegal and intending to conceal the true source and amount of the campaign contributions. In 2007, Odom directly or indirectly used personal funds to reimburse individual contributions to the authorized campaign committee of the presidential candidate for a total of $23,000. As a result of this scheme, Odom intentionally caused the presidential candidate?s authorized campaign committee to file a report with the FEC that falsely stated that 10 individual donors had made federal campaign contributions when in fact each contribution was made by Odom. At sentencing, scheduled for April 23, 2013, Odom faces a maximum potential penalty of five years in prison. This case was investigated by the FBI. This case is being prosecuted by Assistant U.S. Attorney Randall J. Hensel and Trial Attorney Brian K. Kidd of the Criminal Division?s Public Integrity Section.US Files Lawsuit in Louisiana Against Oil and Gas Company Alleging Unlawful Discharge of Oil and Chemical Dispersants in the Gulf of MexicoRead the Press Release
Today the United States filed a civil action against ATP Oil & Gas Corporation and ATP Infrastructure Partners, LP (ATP-IP) for civil penalties and injunctive relief under the Clean Water Act and the Outer Continental Shelf Lands Act. The complaint was filed on behalf of the U.S. Department of the Interior’s Bureau of Safety and Environmental Enforcement (BSEE) and the U.S. Environmental Protection Agency (EPA). The complaint addresses the defendants’ alleged unlawful discharges of oil and unpermitted chemical dispersants from the defendants’ floating oil and gas production platform, the ATP Innovator, into the Gulf of Mexico.
The ATP Innovator is a production facility operating at Lease Block 711 of Mississippi Canyon in the Gulf of Mexico, approximately 45 nautical miles offshore of southeastern Louisiana.
The violations were discovered during a BSEE inspection of the facility in March 2012. Following further investigation by BSEE, the violations were referred to the Department of Justice by BSEE and EPA. The case, United States v. ATP Oil & Gas Corporation et al., was filed in the District Court for the Eastern District of Louisiana.
As alleged in the complaint, ATP failed to properly operate and maintain its wastewater treatment system on the ATP Innovator. As a result, excess oil was discharged into the ocean, and an unauthorized chemical dispersant was added to the oily wastewater discharge to mask the presence of oil on the ocean’s surface. The dispersant was added to the outfall pipe by way of a concealed metal tube that connected a tank of dispersant to the outfall pipe. The connection of the metal tubing to the outfall pipe was located downstream of the sample collection point, making the addition of unauthorized dispersant undetectable in samples that are required to be collected to show compliance with ATP’s Clean Water Act discharge permit.
According to the complaint, the dispersant had been used from at least October 2010 to March 2012. In addition to civil penalties under the Clean Water Act, the complaint also seeks injunctive relief for violations of the Clean Water Act and the Outer Continental Shelf Lands Act.
Related Materials:
ATP Complaint
New York Immigration Judge Participates in Naturalization CeremonyRead the Press Release
NEW YORK -- Immigration Judge Joanna Bukszpan from the Executive Office for Immigration Review, New York Immigration Court, delivered the keynote speech and administered the oath of allegiance to approximately 150 candidates during a naturalization ceremony at 26 Federal Plaza in New York on Feb. 8, 2013. The New York District Office of U.S. Citizenship and Immigration Services, Department of Homeland Security, hosted the ceremony.
Biographical Information
Attorney General Janet Reno appointed Judge Bukszpan in September 1995. Judge Bukszpan received a bachelor of arts degree in 1963 from the City University of New York and a juris doctorate in 1976 from Brooklyn Law School. From 1978 to 1995, she was in private practice in New York. From 1976 to 1978, she worked as a trial attorney/general attorney (nationality) for the former Immigration and Naturalization Service in New York. Judge Bukszpan is a member of the District of Columbia and New York State Bars.
- EOIR -
The Executive Office for Immigration Review (EOIR) is an agency within the Department of Justice. Under delegated authority from the Attorney General, immigration judges and the Board of Immigration Appeals interpret and adjudicate immigration cases according to United States immigration laws. EOIR’s immigration judges conduct administrative court proceedings in immigration courts located throughout the nation. They determine whether foreign-born individuals—whom the Department of Homeland Security charges with violating immigration law—should be ordered removed from the United States or should be granted relief from removal and be permitted to remain in this country. The Board of Immigration Appeals primarily reviews appeals of decisions by immigration judges. EOIR’s Office of the Chief Administrative Hearing Officer adjudicates immigration-related employment cases. EOIR is committed to ensuring fairness in all of the cases it adjudicates.
Executive Office for Immigration ReviewJustice Department Moves to Intervene in Lawsuit Alleging Sex Discrimination Against the State of Maryland, Queen Anne’s County and the Queen Anne’s County SheriffRead the Press Release
The Justice Department today moved to intervene in Murphy-Taylor v. State of Maryland, et al., a private lawsuit alleging sex discrimination by the state of Maryland, Queen Anne’s County and the Queen Anne’s County Sheriff. The United States’ complaint in intervention alleges that Kristy Murphy-Taylor’s supervisors in the sheriff’s office subjected her to severe sexual harassment and retaliated against her when she complained. The complaint alleges that these actions violate Title VII of the Civil Rights Act of 1964.
According to the complaint, over a number of years Ms. Murphy-Taylor was subjected to numerous acts of unwanted sexual conduct by multiple supervisors including, multiple incidents of unwanted sexual touching, sexually explicit comments about Ms. Murphy-Taylor and other female officers, and derogatory comments about Ms. Murphy-Taylor based on her sex and about women in general.
Despite Ms. Murphy-Taylor’s complaints to supervisory officials about the unwelcome conduct, the complaint alleges that the defendants failed to take prompt and effective corrective action, subjected her to intolerable working conditions intended to make her quit, and ultimately terminated her for complaining about the sexual harassment.
The United States determined that this case represents a matter of general public importance and that the Department of Justice should participate in it. By intervening, the United States will ensure that the law continues to protect employees and that the price of earning a living will not be enduring constant sexual harassment. The relief sought by the United States is past and future lost wages and compensatory damages for Ms. Murphy-Taylor as well as the implementation of effective sexual harassment policies and procedures and training on these policies and procedures.
Ms. Murphy-Taylor filed a charge of sex discrimination and retaliation with the Baltimore District Office of the Equal Employment Opportunity Commission (EEOC). After investigating these charges, finding reasonable cause to believe that the charging party was subject to discrimination because of her sex, and unsuccessfully attempting to conciliate the matter, the EEOC referred the charges to the Department of Justice. This lawsuit is brought by the Department of Justice as a result of a project designed to ensure vigorous enforcement of Title VII against state and local governmental employers by enhancing cooperation between the EEOC and the Civil Rights Division.
“The Department of Justice will not stand by while women are forced to endure unwanted sexual conduct in their workplaces and then penalized for protesting it,” said Jocelyn Samuels, Principal Deputy Assistant Attorney General for the Civil Rights Division. “Through our partnership with the EEOC, the department continues its commitment to vigorously enforcing the right of employees to be free from sex discrimination in the work place.”
“The work of the commission is made more effective and efficient with interagency coordination,” said Jacqueline A. Berrien, chair of the Equal Employment Opportunity Commission. “Our ongoing project with the Justice Department helps to ensure that employees receive the full protection of the laws prohibiting workplace discrimination.”
“By working more closely together in appropriate cases, EEOC and DOJ are able to use our resources more efficiently to ensure the vigorous enforcement of Title VII in the public sector,” said EEOC District Director Spencer H. Lewis Jr., of the EEOC’s Philadelphia District Office. The Philadelphia District Office of the EEOC oversees Pennsylvania, Maryland, Delaware, West Virginia and parts of New Jersey and Ohio.
Title VII prohibits discrimination in employment on the basis of sex, race, color, national origin or religion, and prohibits retaliation against an employee who opposes an unlawful employment practice, or because the employee has made a charge or participated in an investigation, proceeding or hearing under the Act. More information about Title VII and other federal employment laws is available at www.usdoj.gov/crt/emp/index.html .
The EEOC enforces federal laws prohibiting employment discrimination. Further information about the EEOC is available on its website at www.eeoc.gov.
Former Registered Nurse Sentenced in Miami to 111 Months in Prison in Connection with $63 Million Mental Health Care Fraud SchemeRead the Press Release
A former registered nurse was sentenced today to serve 111 months in prison for his role in a health care fraud scheme involving defunct health provider Health Care Solutions Network Inc. (HCSN), announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; Michael B. Steinbach, Special Agent in Charge of the FBI’s Miami Field Office; and Special Agent in Charge Christopher B. Dennis of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), Office of Investigations Miami office.
John Thoen, 53, of Miami, was sentenced by U.S. District Judge Cecilia M. Altonaga in the Southern District of Florida. In addition to his prison term, Thoen was sentenced to serve three years of supervised release.
On Nov. 20, 2012, Thoen pleaded guilty in the Southern District of Florida to one count of conspiracy to commit health care fraud and one count of conspiracy to commit money laundering.
According to court documents, HCSN operated community mental health centers (CMHC) at three locations in Miami-Dade County, Fla., and one location in Hendersonville, N.C. HCSN purported to provide partial hospitalization program (PHP) services to individuals suffering from mental illness. A PHP is a form of intensive treatment for severe mental illness. According to court documents, HCSN obtained Medicare beneficiaries to attend HCSN for purported PHP treatment that was unnecessary and, in many instances, not even provided. HCSN obtained those beneficiaries in Miami by paying kickbacks to owners and operators of assisted living facilities.
According to court documents, Thoen was a licensed registered nurse in both Florida and North Carolina. In Florida, Thoen participated in the admission to HCSN of patients who were ineligible for PHP services. Thoen participated in the routine fabrication of patient medical records that were utilized to support false and fraudulent billing to government sponsored health care benefit programs, including Medicare and Medicaid.
In North Carolina, Thoen, according to court documents, routinely submitted fraudulent PHP claims for Medicare patients who were not even present at the CMHC on days PHP services were purportedly rendered. Thoen also caused the submission of fraudulent Medicare claims on days the CMHC was closed due to snow.
Thoen also admitted to his role in a money laundering scheme, involving Psychiatric Consulting Network Inc. (PCN), a Florida corporation that was utilized by HCSN as a shell corporation to launder health care fraud proceeds. According to court documents, Thoen was president of PCN.
According to court documents, from 2004 through 2011, HCSN billed Medicare and the Florida Medicaid program approximately $63 million for purported mental health services.
Fifteen defendants have been charged for their alleged roles in the HCSN health care fraud scheme, and nine defendants have pleaded guilty. Alleged co-conspirators Wondera Eason and Paul Layman are scheduled for trial on March 11, 2013, before Judge Altonaga in Miami. And alleged co-conspirators Alina Feas, Dana Gonzalez, Gema Pampin and Lisset Palmero are scheduled for trial on June 3, 2013. Defendants are presumed innocent until proven guilty at trial.
The cases are being prosecuted by Special Trial Attorney William Parente and Trial Attorney Allan J. Medina of the Criminal Division’s Fraud Section. This case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. In support of the Medicare Fraud Strike Force, the FBI Criminal Investigative Division’s Financial Crimes Section has funded the Special Trial Attorney position.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,480 defendants who have collectively billed the Medicare program for more than $4.8 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is 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.
Florida Physician to Pay $26.1 Million to Resolve False Claims AllegationsRead the Press Release
Steven J. Wasserman, M.D., a dermatologist practicing in Venice, Fla., has agreed to pay $26.1 million to resolve allegations that he violated the False Claims Act by accepting illegal kickbacks from a pathology laboratory and by billing the Medicare program for medically unnecessary services, the Justice Department announced today. The settlement is the largest ever with an individual under the False Claims Act in the Middle District of Florida and one of the largest with an individual under the False Claims Act in U.S. history.
The government alleged that, in or around 1997, Dr. Wasserman entered into an illegal kickback arrangement with Tampa Pathology Laboratory (TPL), a clinical laboratory in Tampa, Fla., and Dr. José SuarezHoyos, a pathologist and the owner of TPL, in an effort to increase the lab’s referral business. Under that agreement, Dr. Wasserman allegedly sent biopsy specimens for Medicare beneficiaries to TPL for testing and diagnosis. In return, TPL allegedly provided Dr. Wasserman a diagnosis on a pathology report that included a signature line for Dr. Wasserman to make it appear to Medicare that he had performed the diagnostic work that TPL had performed. The government alleged that Dr. Wasserman then billed the Medicare program for TPL’s work, passing it off as his own, for which he received more than $6 million in Medicare payments. In addition, the government asserted that, in furtherance of his agreement with TPL, Dr. Wasserman substantially increased the number of skin biopsies he performed on Medicare patients, thus increasing the referral business for TPL.
The government further alleged that, in addition to his involvement in the alleged kickback scheme, Dr. Wasserman also performed thousands of unnecessary skin surgeries known as adjacent tissue transfers on Medicare beneficiaries. Adjacent tissue transfers are complicated and often time-consuming procedures physicians sometimes use to close a defect resulting from the removal of a growth on a patient’s skin. The government
alleged that Dr. Wasserman performed many of these procedures in order to obtain the reimbursement for them, and not because they were medically necessary.
“Doctors who take illegal kickbacks and perform unnecessary procedures not only put their own financial self-interest over their duty to their patients, they raise the cost of health care for all of us as patients and as taxpayers,” said Stuart F. Delery, Principal Deputy Assistant Attorney General for the Civil Division of the Department of Justice. “The Department of Justice will not tolerate those who abuse the public health care programs to which we all contribute and on which we all depend.”
“This settlement represents a watershed achievement in our district’s civil healthcare fraud enforcement program,” said Robert O’Neill, U.S. Attorney for the Middle District of Florida. “Schemes of this magnitude require extraordinary remedies, and we are proud to have reached such an outstanding resolution for the taxpayers and their health programs.”
The allegations resolved by today’s settlement were initiated by a lawsuit originally filed in the District Court for the Middle District of Florida by Alan Freedman, M.D., a pathologist who formerly worked at TPL. Dr. Freedman filed the lawsuit under the qui tam, or whistleblower provisions of the False Claims Act. Under the False Claims Act, a private party may file suit on behalf of the United States for false claims and share in any recovery. The United States has the right to intervene in the action, which it did in this case, filing its own complaint in October 2010. Dr. Freedman will receive $4,046,000 of today’s settlement.
The United States previously settled with TPL and Dr. SuarezHoyos for $950,000 to resolve the allegations asserted against them in the same lawsuit.
“Anyone cheating patients and taxpayers should expect to pay a high price,” said Daniel R. Levinson, Inspector General of the U.S. Department of Health and Human Services. “Besides paying more than $26 million, Dr. Wasserman is excluded from treating patients and being paid under Medicare, Medicaid and all other federal health care programs.”
This resolution is part of the government’s emphasis on combating health care fraud and another step for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced by Attorney General Eric Holder and Kathleen Sebelius, Secretary of the Department of Health and Human Services in May 2009. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in that effort is the False Claims Act, which the Justice Department has used to recover more than $10.2 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department’s total recoveries in False Claims Act cases since January 2009 are over $14 billion.
Principal Deputy Assistant Attorney General Delery and U.S. Attorney O’Neill thanked the joint investigation team, which includes special agents with the Department of Health and Human Services-OIG and the FBI, for their efforts in the investigation of this matter.
The claims settled by this agreement are allegations only; there has been no determination of liability.
The lawsuit is captioned U.S. ex rel. Freedman v. SuarezHoyos et al., No. 04-933 (M.D. Fla.).
Departments of Justice and Health and Human Services Announce Record-Breaking Recoveries Resulting from Joint Efforts to Combat Health Care FraudRead the Press Release
Attorney General Eric Holder and Health and Human Services (HHS) Secretary Kathleen Sebelius today released a new report showing that for every dollar spent on health care-related fraud and abuse investigations in the last three years, the government recovered $7.90. This is the highest three-year average return on investment in the 16-year history of the Health Care Fraud and Abuse (HCFAC) Program.
The government’s health care fraud prevention and enforcement efforts recovered a record $4.2 billion in taxpayer dollars in Fiscal Year (FY) 2012, up from nearly $4.1 billion in FY 2011, from individuals and companies who attempted to defraud federal health programs serving seniors and taxpayers or who sought payments to which they were not entitled. Over the last four years, the administration’s enforcement efforts have recovered $14.9 billion, up from $6.7 billion over the prior four-year period. Since 1997, the HCFAC Program has returned more than $23 billion to the Medicare Trust Funds.
These findings, released today in the annual HCFAC Program report, are a result of President Obama making the elimination of fraud, waste and abuse, particularly in health care, a top priority for the administration.
The success of this joint Department of Justice and HHS effort was made possible by the Health Care Fraud Prevention and Enforcement Action Team (HEAT), created in 2009 to prevent fraud, waste and abuse in the Medicare and Medicaid programs and to crack down on individuals and entities that are abusing the system and costing American taxpayers billions of dollars. These efforts to reduce fraud will continue to improve with new tools and resources provided by the Affordable Care Act.
“This was a record-breaking year for the Departments of Justice and Health and Human Services in our collaborative effort to crack down on health care fraud and protect valuable taxpayer dollars,” said Attorney General Holder. “In the past fiscal year, our relentless pursuit of health care fraud resulted in the disruption of an array of sophisticated fraud schemes and the recovery of more taxpayer dollars than ever before. This report demonstrates our serious commitment to prosecuting health care fraud and safeguarding our world-class health care programs from abuse.”
“Our historic effort to take on the criminals who steal from Medicare and Medicaid is paying off: We are gaining the upper hand in our fight against health care fraud,” said Secretary Sebelius. “This fight against fraud strengthens the integrity of our health care programs and helps us fulfill our commitment to our seniors.”
About $4.2 billion stolen or otherwise improperly obtained from federal health care programs was recovered and returned to the Medicare Trust Funds, the Treasury and others in FY 2012. This is an unprecedented achievement for the HCFAC Program, a joint Justice Department and HHS effort to coordinate federal, state and local law enforcement activities to fight health care fraud and abuse.
The administration is also using tools authorized by the Affordable Care Act to fight fraud, including enhanced screenings and enrollment requirements, increased data sharing across the government, expanded recovery efforts for overpayments and greater oversight of private insurance abuses.
Since 2009, the Justice Department and HHS have improved their coordination through HEAT and increased the number of Medicare Fraud Strike Force teams to nine. The Justice Department’s enforcement of the civil False Claims Act and the Federal Food, Drug and Cosmetic Act have produced similar record-breaking results. These combined efforts coordinated under HEAT have expanded local partnerships and helped educate Medicare beneficiaries about how to protect themselves against fraud. In FY 2012, the two departments continued their series of regional fraud prevention summits, and the Justice Department hosted a training conference for federal prosecutors, FBI agents, HHS Office of Inspector General agents and others.
The strike force teams use advanced data analysis techniques to identify high-billing levels in health care fraud hot spots so that interagency teams can target emerging or migrating schemes as well as with chronic fraud by criminals masquerading as health care providers or suppliers. In July, Attorney General Holder and Secretary Sebelius announced the launch of a ground-breaking partnership among the federal government, state officials, leading private health insurance organizations and other health care anti-fraud groups to share information and best practices to improve detection of and prevent payments to scams that cut across public and private payers.
In FY 2012, the Justice Department opened 1,131 new criminal health care fraud investigations involving 2,148 potential defendants, and a total of 826 defendants were convicted of health care fraud-related crimes during the year. The department also opened 885 new civil investigations.
The strike force coordinated a takedown in May 2012 that involved the highest number of false Medicare billings in the history of the strike force program. The takedown involved 107 individuals, including doctors and nurses, in seven cities, who were charged for their alleged participation in Medicare fraud schemes, involving about $452 million in false billings. As a part of the May 2012 takedown, HHS also suspended or took other administrative action against 52 providers using authority under the health care law to suspend payments until an investigation is complete.
Strike force operations in the nine cities where teams are based resulted in 117 indictments, informations and complaints involving charges against 278 defendants who allegedly billed Medicare more than $1.5 billion in fraudulent schemes. In FY 2012, 251 guilty pleas and 13 jury trials were litigated, with guilty verdicts against 29 defendants, in strike force cases. The average prison sentence in these cases was more than 48 months.
The new authorities under the Affordable Care Act granted to HHS and the Centers for Medicare & Medicaid Services (CMS) were instrumental in clamping down on fraudulent activity in health care. In FY 2012, CMS began the process of screening all 1.5 million Medicare-enrolled providers through the new Automated Provider Screening system that quickly identifies ineligible and potentially fraudulent providers and suppliers prior to enrollment or revalidation to verify the data. As a result, nearly 150,000 ineligible providers have already been eliminated from Medicare’s billing system.
CMS also established the Command Center to improve health care-related fraud detection and investigation, drive innovation and help reduce fraud and improper payments in Medicare and Medicaid.
From May 2011 through the end of 2012, more than 400,000 providers were subject to the new screening requirements and nearly 150,000 lost the ability to bill the Medicare program due to the Affordable Care Act requirements and other proactive initiatives.
The Department of Justice and HHS also continued their successes in civil health care fraud enforcement during FY 2012. The Justice Department’s Civil Division Fraud Section, with their colleagues in U.S. Attorneys’ offices throughout the country, obtained settlements and judgments of more than $3 billion in FY 2012 under the False Claims Act (FCA). These matters included unlawful pricing by pharmaceutical manufacturers, illegal marketing of medical devices and pharmaceutical products for uses not approved by the Food and Drug Administration, Medicare fraud by hospitals and other institutional providers, and violations of laws against self-referrals and kickbacks. This marked the third year in a row that more than $2 billion has been recovered in FCA health care matters. Additionally, the Civil Division’s Consumer Protection Branch, working with U.S. Attorneys’ offices, obtained nearly $1.5 billion in fines and forfeitures, and obtained 14 convictions in matters pursued under the Federal Food, Drug and Cosmetic Act.
For more information on the joint DOJ-HHS Strike Force activities, visit: www.StopMedicareFraud.gov.
For more information on the fraud prevention accomplishments under the Affordable Care Act visit: http://www.healthcare.gov/news/factsheets/2012/02/medicare-fraud02142012a.html.
Related Material:
- FY 2012 HCFAC Report
Baltimore Immigration Judge Participates in Naturalization CeremonyRead the Press Release
BALTIMORE --Immigration Judge Lisa Dornell from the Executive Office for Immigration Review, Baltimore Immigration Court, delivered the keynote speech and administered the oath of allegiance to approximately 75 candidates during a naturalization ceremony at the George H. Fallon Federal Building in Baltimore, Md., on Feb. 8, 2012. The Baltimore District Office of U.S. Citizenship and Immigration Services, Department of Homeland Security, hosted the ceremony.
Biographical Information
Attorney General Janet Reno appointed Judge Dornell in April 1995. Judge Dornell received a bachelor of arts degree in 1983 from the University of Vermont and a juris doctorate in 1986 from the University of Texas at Austin School of Law. From 1990 to 1995, Judge Dornell served as senior litigation counsel, Office of Immigration Litigation, Civil Division, Department of Justice. From 1986 to 1990, she served as a trial attorney for the former Immigration and Naturalization Service (INS), New York district office, and as an assistant general counsel, INS Headquarters, Washington, D.C. Judge Dornell lectures on immigration topics and court procedure at several local law schools. She is a member of the District of Columbia and State of Texas Bars.
- EOIR -
The Executive Office for Immigration Review (EOIR) is an agency within the Department of Justice. Under delegated authority from the Attorney General, immigration judges and the Board of Immigration Appeals interpret and adjudicate immigration cases according to United States immigration laws. EOIR’s immigration judges conduct administrative court proceedings in immigration courts located throughout the nation. They determine whether foreign-born individuals—whom the Department of Homeland Security charges with violating immigration law—should be ordered removed from the United States or should be granted relief from removal and be permitted to remain in this country. The Board of Immigration Appeals primarily reviews appeals of decisions by immigration judges. EOIR’s Office of the Chief Administrative Hearing Officer adjudicates immigration-related employment cases. EOIR is committed to ensuring fairness in all of the cases it adjudicates.
Executive Office for Immigration Review