District Not Recorded

The Justice Department announced that, jointly with the Meridian Public School District in Meridian, Miss., and private plaintiffs, it has filed a landmark consent decree to prevent and address racial discrimination in student discipline in district schools.  If approved by the court, the proposed consent decree will resolve the department’s investigation into complaints that the district unlawfully and disproportionately subjects black students to suspension, expulsion and school-based arrest, often for minor infractions.  In the course of the investigation, the department found that black students frequently received harsher disciplinary consequences, including longer suspensions, than white students for comparable misbehavior, even where the students were at the same school, were of similar ages, and had similar disciplinary histories.  The consent decree would amend a longstanding federal school desegregation decree enforced by the United States, which prohibits the district from discriminating against students based on race.

“The American dream is rooted in education. In Meridian, that dream has long been delayed by discipline practices that deny students access to education,” said Jocelyn Samuels, Principal Deputy Assistant Attorney General for the Civil Rights Division. “We commend the Meridian Public School District for taking this huge step toward ensuring that its schools are safe and welcoming to all students and that education is a road to success instead of a pipeline to prison.”

Under the consent decree, the district will take steps to create safe and inclusive learning environments in all Meridian schools, including providing students with supports and interventions before excluding them from school; limiting the use of discipline measures that remove students from the classroom; ensuring that discipline consequences are fair and consistent; establishing clear guidelines for when law enforcement intervention is appropriate; providing training to give teachers and administrators the tools necessary to manage their schools in a safe, effective and positive manner; and building data-driven monitoring and accountability systems.

“Punitive and discriminatory discipline policies prevent the promise of Brown v. Board of Education from being a reality today,” said Gregory K. Davis, U.S. Attorney for the Southern District of Mississippi. “This consent decree will help bring equal justice and opportunity back into reach for the children of Meridian.”

The consent decree:

• Limits exclusionary discipline such as suspension, alternative placement and expulsion, and prohibits exclusionary discipline for minor misbehavior;
• Prohibits school officials from involving law enforcement officers to respond to behavior that can be safely and appropriately handled under school disciplinary procedures;
• Requires training for school law enforcement officers on bias-free policing, child and adolescent development and age appropriate responses, practices proven to improve school climate, mentoring and working with school administrators ;
• Revises policies at the district’s alternative school to create clear entry and exit criteria and provide appropriate supports to speed students’ transitions back to their home schools;  
• Requires enhanced due process protections in student discipline hearings;
• Expands use of a behavior and discipline management system known as positive behavior intervention and supports (PBIS) at all schools;
• Requires teachers and administrators to use developmentally appropriate tiered prevention and intervention strategies before removing students from instruction;
• Requires monitoring of discipline data to identify and respond to racial disparities;
• Requires training on all revised policies and procedures; and
• Implements measures to engage families and communities as partners in revising policies and as participants in regular school and community informational forums.

The division filed a related case against the Meridian Police Department, the Lauderdale County Youth Court and the state of Mississippi in October 2012, alleging that those defendants systematically violate the due process rights of students referred by the district. That case remains pending in the U.S. District Court for the Southern District of Mississippi.

The enforcement of Title IV of the Civil Rights Act of 1964, which prohibits discrimination on the basis of race, among other bases, in public schools is a top priority of the Justice Department’s Civil Rights Division.  Additional information about the Civil Rights Division of the Justice Department is available on its website at www.justice.gov/crt.

Related Materials:

Meridian Consent Decree

A superseding indictment against four Police of Puerto Rico (POPR) officers was announced today by Roy L. Austin Jr., Deputy Assistant Attorney General for the Civil Rights Division; Rosa Emilia Rodriguez-Velez, U.S. Attorney for the District of Puerto Rico; and Carlos Cases, Special Agent in Charge of the FBI San Juan Field Office.

POPR Lieutenant Erick Rivera Nazario and Officer David Colon Martinez were indicted on civil rights charges alleging that they violated the constitutional rights of Jose Irizarry Perez while he was celebrating the local election results at the Las Colinas housing development in Yauco, Puerto Rico, on Nov. 5, 2008. Rivera was also charged with violating the civil rights of Irizarry Perez’s father, Jose Irizarry Muniz. In addition, Rivera, Colon, Officer Miguel Negron Vazquez and Sergeant Antonio Rodriguez Caraballo were indicted for obstruction of justice and making false statements to the FBI and a federal grand jury.

According to the 18 count superseding indictment, while Colon held and restrained Irizarry Perez, Rivera and another POPR officer assaulted Irizarry Perez with their hands and a police baton, which resulted in bodily injury to Irizarry Perez. The superseding indictment alleges that Irizarry Perez was thereby deprived of his right to be free from unreasonable seizures by those acting under color of law. Although Irizarry Perez died as a result of injuries he sustained on Nov. 5, 2008, the superseding indictment does not include charges that his death resulted from the defendants’ conduct. Rivera, who was a supervisor at the time of the incident, was also charged with failing to intervene and failing to keep Irizarry Perez and his father from harm when an officer whom Rivera supervised assaulted the victims in Rivera’s presence.

In addition, the superseding indictment alleges that all four of the charged officers made false statements concerning the incident to the FBI and to the federal grand jury which had been investigating the incident. Colon and Negron were also charged with obstruction of justice for submitting false police reports and for providing misleading information to the Puerto Rico prosecutor that initially investigated the matter. Rivera was additionally charged with obstruction of justice for submitting a false police report, and Rodriguez was charged with obstruction of justice for providing misleading information to the Puerto Rico prosecutor.

If convicted, Rivera faces a maximum penalty of 10 years in prison for each of three charged counts of civil rights violations; a maximum of 20 years in prison for one charged count of obstruction of justice by submitting a false police report; and a maximum penalty of five years in prison for one charged count of making a false statement to the FBI and one charged count of making a false declaration to the grand jury.

If convicted, Colon faces a maximum penalty of 10 years in prison for one charged count of a civil rights violation; a maximum of 20 years in prison for one charged count of obstruction of justice by submitting a false police report and two charged counts of providing misleading information to the local prosecutor; and a maximum penalty of five years in prison for one charged count of making a false statement to the FBI and one charged count of making a false declaration to the grand jury.

If convicted, Negron faces a maximum penalty of 20 years in prison for one charged count of obstruction of justice by submitting a false police report and one charged count of providing misleading information to the local prosecutor; and a maximum penalty of five years in prison for one charged count of making a false statement to the FBI and one charged count of making a false declaration to the grand jury.

If convicted, Rodriguez faces a maximum penalty of 20 years in prison for one charged count of obstruction of justice by providing misleading information to the local prosecutor; and a maximum penalty of five years in prison for one charged count of making a false statement to the FBI and one charged count of making a false declaration to the grand jury.

An indictment is merely an accusation, and the defendants are presumed innocent unless proven guilty.

This case is being investigated by the San Juan Division of the FBI and is being prosecuted by Assistant U.S. Attorney Jose A. Contreras from the U.S. Attorney’s Office for the District of Puerto Rico and Senior Litigation Counsel Gerard Hogan and Trial Attorney Shan Patel from the Civil Rights Division of the U.S. Department of Justice.

Dennis Frisbie Jr., 33, former deputy with the Muskogee County, Okla., Sheriff’s Office, who was assigned as a detention officer at the Muskogee County Jail (MCJ), pleaded guilty today in U.S. District Court for the Western District of Oklahoma to one count of making material false statements to the FBI.

“Law enforcement officers who make false statements erode the trust of the people they have sworn to protect,” said Deputy Assistant Attorney General for the Civil Rights Division Roy L. Austin Jr. “The Civil Rights Division is committed to prosecuting members of law enforcement who impede investigations of police misconduct.”

According to court documents, during the summer of 2011, FBI agents interviewed Frisbie as part of a federal investigation into allegations of inmate abuse at MCJ. Subsequently, on July 10, 2011, and then again on July 12, 2011, the defendant falsely reported to the FBI, both verbally and in a handwritten statement, that he been shot in the shoulder by an unknown subject in retaliation for his cooperation with this federal investigation. As a result of what the defendant reported, the FBI halted its investigation, out of concern that potential witnesses were in physical danger.

However, in September 2011, the defendant admitted that he had lied to the FBI and that he had not been shot by an unknown assailant. Instead, the defendant admitted that the gunshot wound was self-inflicted. The defendant acknowledged that he knowingly and willfully lied to the FBI and these lies were material, in that they directly affected the federal investigation into allegations of abuse at MCJ.

A sentencing date has not yet been set.

This case was investigated by the Muskogee Resident Agency of the Oklahoma City Division of the FBI and is being prosecuted by Trial Attorneys Fara Gold and Dana Mulhauser of the Civil Rights Division of the U.S. Department of Justice.

Two shipping firms based in Germany and Cyprus today pleaded guilty to felony obstruction of justice charges and violating the Act to Prevent Pollution from Ships related to the deliberate concealment of vessel pollution from four ships that visited U.S. ports in New Jersey, Delaware and Northern California, announced the Department of Justice Environment and Natural Resources Division, the U.S. Attorney’s Offices in New Jersey and Delaware, and the U.S. Coast Guard. 

 U.S. Attorney for the District of New Jersey Paul J. Fishman and U.S. Coast Guard Deputy Commander of the Delaware Bay Sector Capt. Todd Wiemers announced the plea agreement – which includes a $10.4 million penalty, $2.6 million of which will be used address environmental damage caused by Hurricane Sandy – at a press conference in Newark, N.J.

According to a multi-district plea agreement arising out of charges brought in the District of New Jersey and District of Delaware, Columbia Shipmanagement (Deutschland) GmbH (CSM-D), a German corporation, and Columbia Shipmanagement Ltd. (CSM-CY), a Cypriot company, have agreed to pay a $10.4 million penalty and be placed on probation for four years.  During probation, the companies will be subject to the terms of an environmental compliance program that requires outside audits by an independent company and oversight by a court appointed monitor.  The shipping firms admitted that four of their ships (three oil tankers and one container ship) had intentionally bypassed required pollution prevention equipment and falsified the oil record book, a required log regularly inspected by the U.S. Coast Guard.  The case is the largest vessel pollution settlement in either New Jersey or Delaware. The guilty pleas were entered before U.S. District Judge Susan D. Wigenton in Newark federal court. Sentencing is set for June 24, 2013.

“Deliberate pollution and intentional falsification of ship records to hide environmental crimes are serious offenses.  These reprehensible actions not only damage the marine environment, but also put law breakers at a competitive advantage over those who respect the law and play the by rules” said Ignacia S. Moreno, Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division.  “We intend to send a message with these prosecutions that those engaged in deliberate despoiling of our precious natural resources will be vigorously prosecuted.”

 “We in New Jersey are as sensitive as anyone to the need to preserve the shoreline,” said U.S. Attorney for the District of New Jersey Paul J. Fishman. “Shipping companies who foul the water by deliberately discharging oil and lying about it to the Coast Guard can expect to be prosecuted.”

“This prosecution is a fine example of multi-district cooperation in enforcing federal environmental law and achieving a just sentence,” said U.S. Attorney for the District of Delaware Charles M. Oberly III.”

“This was a case of wilful pollution and deliberate falsification of records designed to deceive the Coast Guard,” said Captain David Fish, Chief of Investigations for the Coast Guard. “It takes both resources and a culture of compliance to abide by the law. We are hopeful that the remedial measures required as part of this criminal conviction will have a positive impact on these companies and serve as a message to other maritime companies as to what is expected.” The proposed $10.4 million penalty includes $2.6 million in organizational community service payments to assist the coastal maritime environment in New Jersey and Delaware damaged by Hurricane Sandy.  The plea agreement directs the funds to environmental projects that will be selected by the National Fish & Wildlife Foundation to help conserve, preserve, and restore the coastal environment of New Jersey and Delaware hit by Hurricane Sandy.   

The investigation into the M/T King Emerald was launched on May 7, 2012, after several crew members provided cell phone photos and other evidence to Coast Guard officers conducting a routine inspection.  The King Emerald was engaged in various types of illegal discharges of bilge waste dating back to at least 2010.  In pleading guilty, the defendants admitted that illegal discharges of both sludge and oily bilge waste were discharged at night off the coast of Central America, including a discharge within the Exclusive Economic Zone of Costa Rica where a national park is located.  The ship’s second engineer pleaded guilty previously and will be sentenced in Newark on April 3, 2013.

 The Delaware investigation began in October 2012, after several crew members of the M/T Nordic Passat provided the Coast Guard with a thumb drive containing photographs and video showing how illegal discharges had been sent overboard through the ship’s sewage system.  They also alleged that sludge had been put into the ship’s cargo tanks and that logs showing sludge had been incinerated onboard had been falsified.  The charges involving the M/V Cape Maas stem from a whistleblower report to the Coast Guard when the ship visited the port in San Francisco.  He provided a video showing the operation of the oily water separator pumping overboard without the use of the oil content monitor to detect and prevent oil from being illegally discharged.   

Just two weeks prior to today’s plea, the defendants and their attorneys disclosed violations on a fourth ship, the M/T Cape Taft that was then anchored in New York waters and destined for New Jersey.  After the ship disclosed problems to the company, an internal investigation revealed that the ship’s oily water separator had been used improperly for some time.  Instead of sensing a sample of overboard discharges, it was instead flushed with fresh water by the crew.  The ship’s oil record book was revised by CSM-D to reveal 16 instances where it was false.  The defendants cooperated with the investigation and provided the government with video replays of the oil content monitor showing when the crew had “tricked” the sensor with fresh water.

In pleading guilty, the defendants have admitted the following in a detailed joint factual statement filed in court:

• The King Emerald oil tanker used three different methods to illegally dispose of oily bilge waste.  In April 2012, approximately five tons of oily waste was discharged in the exclusive economic zone of Costa Rica approximately 45 miles from a national park.

• At least three chief engineers and the second engineer were involved in illegal discharges and intentional falsification of the oil record book for the King Emerald. In one instance, the oily water separator was operated solely for the purpose of generating data on the ship’s electronic recording device to account for an illegal discharge that had already taken place.

• During the Coast Guard boarding in Carteret, N.J., the second engineer lied to inspectors and then hid a valve used to make illegal discharges in an overhead space on the ship.

• Oil contaminated bilge waste was illegally pumped overboard from the M/T Nordic Passat on the orders of the chief engineer and second engineer with a portable pump and “magic hose” that was draped down three levels of the engine room to dump overboard through the sewage system.

• Illegal discharges have been made from the M/T Nordic Passat since 2006 by “tricking” the sensor designed to detect oil with fresh water during overboard discharges on a regular and routine practice by or at the direction of the chief engineer and second engineer.  As a result, virtually every discharge totaling approximately 2,000 tons of unmonitored and oil contaminated bilge  waste were discharged into ocean waters illegally and in violation of MARPOL over at least a six year period and all of the corresponding entries in the oil record book were false. 

• During the Coast Guard boarding of the Nordic Passat, senior ship engineers lied to the Coast Guard and told lower level crew members to lie. 

• On the M/V Cape Maas, a container ship, the manufacturer’s seal on the oil content monitor had been broken and fresh water had been used to trick the sensor.  

The plea agreement sets forth the counts charged as to each defendant in each district including six counts involving three vessels in New Jersey and four counts involving one ship in Delaware.  The guilty pleas include violations of the Act to Prevent Pollution from Ships for failing to maintain an accurate oil record book; obstruction of justice, and making false statements.  The maximum penalty for each of these felony offenses is $500,000 or up to twice the gross gain or loss from the offense for a corporation. 

This prosecution was made possible through the combined efforts of the U.S. Coast Guard Districts 1, 5 and 11, Coast Guard Sectors New York, Delaware Bay, and San Francisco, Coast Guard Investigative Service, Coast Guard Office of Maritime and International Law, and the Coast Guard Office of Investigations and Analysis.  The cases were prosecuted by Richard A. Udell, Senior Trial Attorney, and Stephen Da Ponte, Trial Attorney, of the Environmental Crimes Section of the U.S. Department of Justice Environment and Natural Resources Division, Kathleen O’Leary, Assistant U.S. Attorney in New Jersey, and Edmond Falgowski, Assistant U.S. Attorney in Delaware.  Assistance was also provided by the U.S. Attorney’s Office for the Northern District of California. 

Peruvian national Jessie Katherine Gonzales Urquizo and Bahamian national Irene Mildred Janette Burrows were sentenced today to serve 60 months and 36 months in prison, respectively, for their roles in smuggling undocumented migrants to the United States for private financial gain, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, and U.S. Immigration and Customs Enforcement (ICE) Director John Morton.

Urquizo, 37, and Burrows, 66, were sentenced by U.S. District Judge Kenneth A. Marra in the Southern District of Florida.

On Jan. 11, 2013, Urquizo and Burrows both pleaded guilty to charges arising from facilitating the illegal smuggling of Brazilian nationals into the United States by working for a known human smuggler in Brazil.  According to court documents, the pair charged between approximately $100 and $125 per day in exchange for providing lodging and transportation to undocumented migrants waiting to be transported by boat to the United States.  As part of the scheme, Urquizo and Burrows received instructions from Brazil-based smugglers on when and where to deliver certain undocumented migrants to waiting boats for passage to the United States

Urquizo and Burrows admitted that they brought undocumented migrants, all of whom are Brazilian nationals, to the United States for financial gain. Urquizo admitted to taking payment for lodging the undocumented migrants at various hotels and stash houses, including a nursing home operated by Burrows, her co-defendant and mother-in-law. Urquizo further admitted that she arranged for food to be taken to the undocumented migrants, transported the undocumented migrants to a waiting boat upon instructions from a known human smuggler in Brazil, and demanded payment for her services. For her part, Burrows admitted to working with Urquizo, taking payment for lodging undocumented migrants at her nursing home, and providing transportation.

The case was prosecuted by Trial Attorney Jay Bauer of the Criminal Division’s Human Rights and Special Prosecutions Section and Assistant U.S. Attorney Alexandra Hui of the Southern District of Florida.

The investigation was conducted by the ICE Homeland Security Investigations in Miami. 

The United States has asked a federal court in Montgomery, Ala., to bar Kenya Hendrix Adams from preparing tax returns for others, the Justice Department announced today. According to the government complaint, Adams has repeatedly prepared federal tax returns that understate her clients’ federal tax liabilities. The suit alleges that Adams did so by falsely claiming or inflating tax credits or fabricating deductions.

The suit alleges that the IRS has completed examinations of 315 returns prepared by Adams and that 88 percent of those returns understated the filing taxpayer’s liability. Because Adams prepared almost 2,000 returns over a five year period between 2007 and 2012, the suit alleges that the harm to the U.S. Treasury as a result of her conduct could be in the millions of dollars.

Claiming bogus tax refunds is one of the Internal Revenue Service’s “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. Kenya Hendrix Adams
Complaint for Permanent Injunction (PDF)
 

The Justice Department announced today that it has reached a cooperative settlement agreement with the Arapahoe, Colo., County Sheriff’s Office under the Americans with Disabilities Act (ADA). This agreement is a companion to one reached on March 8, 2013, with the city of Englewood, Colo.

The Justice Department received complaints by individuals who are deaf, the Colorado Association of the Deaf and the Colorado Cross-Disability Coalition that officers for the city of Englewood and the Arapahoe Sheriff’s Office were not providing qualified sign language interpreters and other auxiliary aids and services when needed for effective communication with people who are deaf, including arrestees, victims and witnesses. The department’s complainants had also filed a lawsuit based on the same allegations in federal district court, Lawrence et al. v. City of Englewood, et al. While the department initiated investigations into the allegations against Englewood’s police department and the Arapahoe County Sheriff’s Office, and considered intervening in the private lawsuit, it also reached out to the parties to see if there were grounds for a cooperative resolution. All parties, including city of Englewood’s Police Chief John Collins and Arapahoe County Sheriff Grayson Robinson, expressed a commitment to ensure full compliance with the ADA.

The resulting settlement agreements include some model ways to ensure people who are deaf or hard of hearing are able to communicate effectively with law enforcement. For instance, officers for Englewood and Arapahoe County will use this pictogram to ask whether a deaf or hard of hearing person requests a sign language interpreter: www.justice.gov/opa/images/sign-lang-small.gif.

Once the person expresses a need for a sign language interpreter, Englewood and Arapahoe have agreed to provide one under most circumstances, often within an hour of the request.

“People who are deaf or hard of hearing need to be able to communicate clearly with police and sheriff officers, whether they are crime victims, witnesses, arrestees, detainees, or just members of the public,” said Eve Hill, Senior Counselor to the Assistant Attorney General for the Civil Rights Division. “Citizens of the City of Englewood and Arapahoe County should be proud of their leaders. I also have to express gratitude to the Colorado Cross-Disability Coalition and the Colorado Association of the Deaf for their important work – and creative problem-solving-- in this area.”

“Englewood Police Chief John Collins and Arapahoe County Sheriff J. Grayson Robinson deserve our thanks and appreciation for their effort to provide effective models for Colorado’s – and the nation’s – law enforcement communities to work with deaf and hard of hearing citizens,” said U.S. Attorney for the District of Colorado John Walsh.  “I strongly encourage law enforcement agencies throughout Colorado to follow their lead and adopt these tried-and-true measures.  Doing so is simple, cost-effective, and will enhance law enforcement agencies’ protection of public safety while complying with the Americans with Disabilities Act.”  

Under the settlements, the city of Englewood and Arapahoe County will each pay $35,000 to the private plaintiffs. In addition, they will enter into contracts with qualified sign language interpreters to ensure ready availability, train their staff on the ADA, appoint ADA coordinators, post signs indicating the availability of sign language interpreters and other auxiliary aids and services for people who are deaf or hard of hearing, provide text telephones and volume control telephones, modify their handcuffing policies for people who use sign language or hand writing to communicate, stock and provide hearing aid and cochlear implant processor batteries in the detention facility, and adopt policies consistent with the ADA. The private plaintiffs also signed these agreements, which resolved the Department of Justice’s investigations as well as the private lawsuit.

For more information on the ADA and law enforcement, visit www.ada.gov. Those interested in finding out more about these settlements or the obligations of law enforcement under the ADA may also 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] .

Related Materials:

American Sign Language sign to indicate whether a sign language interpreter is necessary
Arapahoe Settlement Agreement

A federal grand jury in San Juan, Puerto Rico, has returned an indictment against Thomas Farmer, a former executive of Jacksonville, Fla.-based Crowley Liner Services, for participating in a conspiracy to fix rates and surcharges for freight transported by water between the continental United States and Puerto Rico, the Department of Justice announced today.

The indictment, filed today in the U.S. District Court in San Juan, charges Farmer, the former vice president of price and yield management of Crowley, with conspiring with co-conspirators to suppress and eliminate competition by agreeing to fix rates and surcharges for Puerto Rico freight services from at least as early as mid-2005 until at least April 2008.           

Crowley transports a variety of cargo shipments, such as heavy equipment, perishable food items, medicines and consumer goods, on scheduled ocean voyages between the continental United States and Puerto Rico.

The indictment alleges, among other things, that Farmer and co-conspirators carried out the conspiracy by attending meetings and engaging in conversations and communications in the continental United States and Puerto Rico to fix, stabilize and maintain rates and surcharges for Puerto Rico freight services; to allocate customers of Puerto Rico freight services between and among the conspirators; and to rig bids submitted to customers of Puerto Rico freight services.

“Today’s indictment charges this executive with participating in a price-fixing conspiracy that affected the cost of shipping many consumer goods to Puerto Rico,” said Bill Baer, Assistant Attorney General in charge of the Department of Justice’s Antitrust Division. “The division will continue to vigorously pursue individuals who engage in anticompetitive behavior.” 

 
Farmer is charged with price fixing in violation of the Sherman Act, which carries a maximum penalty of 10 years in prison and a $1 million fine for individuals. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.

As a result of this ongoing investigation, three companies, including Crowley, and six individuals have pleaded guilty or been convicted at trial. Five of the individuals and the three companies have been ordered to serve sentences ranging from seven months to four years in prison and to pay more than $46 million in criminal fines. The sixth individual, Frank Peake, was convicted at trial in January 2013 and is currently scheduled to be sentenced on May 31, 2013.

 
This case is part of an ongoing federal antitrust investigation into price fixing, bid rigging and other anticompetitive conduct in the coastal water freight transportation industry, which is being conducted by the Antitrust Division’s National Criminal Enforcement Section; the Baltimore Resident Agency of the Department of Defense’s Office of the Inspector General, Defense Criminal Investigative Service (DCIS); the Miami Field Office of the Department of Transportation’s Office of Inspector General; and the Jacksonville Field Office of the FBI. Anyone with information concerning anticompetitive conduct in the coastal water freight transportation industry is urged to call the Antitrust Division’s National Criminal Enforcement Section at 202-307-6694, visit www.justice.gov/atr/contact/newcase.htm or contact DCIS’s Baltimore Resident Agency at 410-347-1620.

Brazilian nationals Juliana Rose Tome-Froes and her husband, Fabio Rodrigues Froes, were sentenced today in Miami to 60 months and 46 months in prison, respectively, for smuggling undocumented migrants to the United States for profit, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida and U.S. Immigration and Customs Enforcement (ICE) Director John Morton.

Tome-Froes, 36, and Froes, 49, were sentenced by U.S. District Court Judge Federico A. Moreno in the Southern District of Florida.  In addition to the prison sentences, Judge Moreno ordered each defendant to forfeit $150,000 in illegal proceeds.      

On Jan. 16, 2013, Tome-Froes and Froes pleaded guilty to charges arising from their involvement in human smuggling.  According to court documents, from at least October 2008 until approximately September 2010, the defendants organized, operated and managed a human smuggling network that spanned from Brazil to France, England, The Bahamas and the United States.  The defendants met with undocumented migrants and negotiated forms of payment to be smuggled into the United States.  Before the undocumented migrants departed Brazil, the defendants instructed them to act like tourists and explained that the itinerary through Europe would support a tourist cover story.  In exchange for approximately $16,000, Tome-Froes, with assistance from Froes, arranged air transportation from Brazil to Paris, then London and Nassau, Bahamas.  Tome-Froes arranged the undocumented migrants’ lodging in Paris and Nassau, and then instructed them to fly to Freeport, Bahamas, where they waited for a boat to transport them to the United States.  For the final leg into the United States, Tome-Froes coordinated with various individuals in South Florida to pilot a small boat to Freeport, which picked up the undocumented migrants and transported them to the United States.  According to court documents, the defendants knew the undocumented migrants did not have authorization to enter the United States. 

The case was prosecuted by Trial Attorney Jay Bauer of the Criminal Division’s Human Rights and Special Prosecutions Section and Assistant U.S. Attorney Marton Gyires of the Southern District of Florida.  The investigation was conducted by ICE Homeland Security Investigations in Miami.

The Unified Government of Wyandotte Co. and Kansas City, Kan., has agreed to a settlement to address unauthorized overflows of untreated raw sewage and to reduce pollution levels in urban stormwater, the Department of Justice and Environmental Protection Agency (EPA) announced today.

The settlement, lodged today in federal court in Kansas City, Kan., requires the Unified Government to implement improved operation and maintenance programs for its sewer system, perform initial work to address sewer overflows, and implement an improved Storm Water Management Plan. The Unified Government will also develop a proposed overflow control plan for the sewer system by September 2016 for approval by EPA.  Unified Government’s implementation of that plan, once approved, will be embodied in a subsequent judicial settlement.

 “Today’s agreement will put the Unified Government of Wyandotte County on a clear path toward compliance with the Clean Water Act,” said Ignacia S. Moreno, Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division. “The settlement will address deficiencies and require improvements to Wyandotte County’s sewer and stormwater systems that will reduce risks and bring cleaner water for the benefit of the county resident’s health and the environment.”

“EPA is working with cities to find effective, affordable solutions to control raw sewage and stormwater overflows,” said Cynthia Giles, assistant administrator for EPA’s Office of Enforcement and Compliance Assurance. “Today’s settlement allows the Unified Government to tackle their most important water quality problems first, while preparing a long-term approach to keep local waterways protected in the future.”

“This settlement is good news for Kansas,” said Barry Grissom, U.S. Attorney for the District of Kansas. “By protecting our rivers, we are ensuring clean drinking water supplies, protecting public health, improving recreation and leaving a legacy of healthy rivers for future Kansans.”

 “We are pleased that this settlement will result in the vigorous efforts by the Unified Government to improve its wastewater and stormwater programs,” said Karl Brooks, EPA regional administrator. “These programs will provide significant health and environmental benefits to the citizens of Kansas City, Kansas and Wyandotte County.  Of special note are the immediate actions by the Unified Government to address sewer overflows in the northeast area of the city where there is a high proportion of low income and minority residents.” 

The Unified Government’s sewer system collects and receives domestic, commercial and industrial wastewater from approximately 110,000 area residents. The system includes five wastewater treatment plants and more than 800 miles of sewer lines. The system is served by about one-third combined sewers, which carry both stormwater and wastewater, and the remainder by separated sewers.

Since 2004, the Unified Government has reported more than 450 illegal sewer overflows from its sewer system. These overflows resulted in the discharge of raw sewage into the Missouri River, the Kansas River and their tributaries. Untreated sewage from overflows can cause serious water quality problems and health issues from pollutants including harmful bacteria, oxygen-depleting substances, suspended solids, toxic metals and chemicals, and nutrients. The overflows are in violation of the federal Clean Water Act (CWA) and the terms of the city’s National Pollutant Discharge Elimination System (NPDES) permits for operation of its sewer system.

Under the agreement, the Unified Government is required to perform initial work primarily in the combined sewer portion of the system, located in the oldest developed area of the city, which is expected to provide relief to residences and other properties in the urban core that are often impacted by overflows.

The settlement also requires the Unified Government to implement an improved Storm water management plan, designed to reduce pollutants in stormwater. Municipal stormwater sewers carry significant amounts of pollution into urban rivers, lakes and streams. Pollutants such as lead, copper, oxygen-depleting materials and sediment in municipal stormwater can clog streams, harm or kill aquatic life, and result in human exposure to harmful substances. The existing stormwater management program at issue in this settlement was drafted by the Unified Government and made part of the stormwater discharge permit issued by the state of Kansas in 2001 and reissued in 2007.
Keeping raw sewage and contaminated stormwater out of the waters of the United States is one of the EPA’s highest priorities. Reductions in sewer and stormwater overflows are accomplished by obtaining cities’ commitments to implement timely, affordable solutions to these problems, which may also include the use of integrated municipal stormwater and wastewater plans. Integrated plans are intended to be an option to help municipalities meet their CWA obligations by optimizing the benefits of their infrastructure improvement investments through the appropriate sequencing of work. This approach can also lead to more sustainable and comprehensive solutions, such as green infrastructure, that improve water quality and enhance community vitality.

The partial settlement, lodged today in the U.S. District Court for the District of Kansas, is subject to a 30-day public comment period and approval by the federal court.  A copy of the consent decree is available on the Justice Department website at www.usdoj.gov/enrd/Consent_Decrees.html. 

More information about EPA’s national enforcement initiative: www.epa.gov/compliance/data/planning/initiatives/2011sewagestormwater.html

More information about integrated municipal stormwater and wastewater plans: http://cfpub.epa.gov/npdes/integratedplans.cfm

A New York man was sentenced today in Buffalo to serve 11 years in prison for committing mail fraud and attempting to escape the charges by exerting pressure on a U.S. Attorney’s spouse and candidate for office, the Justice Department announced.

James F. Lagona, 52, of Snyder, N.Y., was sentenced by Chief U.S. District Judge William M. Skretny in the Western District of New York.  Lagona was sentenced to serve nine years in prison on 27 mail fraud charges, one year in prison on one obstruction of justice charge and one year in prison for committing obstruction while on release in the fraud case.  In addition to Lagona’s prison term, he was sentenced to serve three years of supervised release and ordered to pay restitution of $6,396,359 for the fraud charges.

On Feb. 23, 2011, in a case prosecuted by the U.S. Attorney’s Office for the Western District of New York, a federal jury found Lagona guilty of committing 27 counts of felony mail fraud related offenses for his role in the Watermark M-One Financial Services Ponzi scheme.  According to evidence presented at trial, Lagona and his co-conspirators operated a scheme that solicited investors for waterfront real estate and promised a 10 percent return on investment after one year.  In truth, no investments were made, and new investors were recruited to pay off the earlier investors.  A total of 94 victims suffered a loss of over $6 million as a result of the scheme.

On Dec. 18, 2012, in a case prosecuted by the Justice Department’s Criminal Division, Lagona pleaded guilty to a one-count information charging him with endeavoring to influence, obstruct and impede the due administration of justice.  Lagona has been detained since Nov. 15, 2012, pursuant to a criminal complaint.

During his plea proceeding in December, Lagona admitted to obtaining a private meeting with a campaign staffer working for U.S. Representative Kathy Hochul of New York, who was then involved in a close race for reelection against her opponent.  Lagona also admitted that during the Nov. 2, 2012, meeting – four days before the election – he identified himself as a clergyman, claimed that he had been involved in discussions with the political party of Rep. Hochul’s election opponent, and falsely claimed that the opponent’s party was interested in featuring him in an advertisement or rally to claim wrongful prosecution and religious persecution.  He told the campaign staffer that he would instead publicly support Rep. Hochul, if her spouse, Western District of New York U.S. Attorney William J. Hochul Jr., dismissed the criminal case against him.  The campaign staffer subsequently reported the meeting to the FBI.

Lagona admitted to meeting with the campaign staffer a second time on Nov. 3, 2012.  During the meeting, which was covertly recorded by the campaign staffer under the FBI’s supervision, Lagona admitted to specifying that he sought a “quid pro quo” in exchange for refusing to campaign with the party of Rep. Hochul’s opponent and for publicly supporting her instead.  Lagona admitted he told the staffer that in exchange he wanted his case dismissed and for no further charges to be brought against him.  Following the meeting, Lagona made efforts to follow up with the staffer by phone.

The criminal complaint in which Lagona was originally charged with obstruction, unsealed on Nov. 15, 2012, notes that the criminal investigation revealed no evidence that the campaign staffer, Rep. Hochul or her campaign ever intended to accept or considered accepting Lagona’s proposal, nor that the proposal was ever communicated to or considered by U.S. Attorney Hochul.  The investigation has revealed no evidence that any member of the opposing party ever considered using Lagona during the campaign.

The fraud case was prosecuted by Assistant U.S. Attorney Gretchen L. Wylegala of the U.S. Attorney’s Office for the Western District of New York and investigated by the U.S. Postal Inspection Service Boston Division and the Internal Revenue Service-Criminal Investigation New York Field Office.  The obstruction case was prosecuted by Trial Attorney J.P. Cooney of the Criminal Division’s Public Integrity Section and investigated by the FBI Buffalo Division. 

The Justice Department announced that it has reached an agreement with the city of Wheatland, Calif., that, if approved by the court, will allow it to bail out from its status as a “covered jurisdiction” under the special provisions of the Voting Rights Act, and thereby exempt the city from the preclearance requirements of Section 5 of the Voting Rights Act. Wheatland is located in Yuba County, Calif., which is a jurisdiction subject to Section 5. The agreement is in the form of a consent decree filed today in the U.S. District Court for the District of Columbia.  

Under Section 5 of the Voting Rights Act, certain covered jurisdictions, determined according to Section 4 of the act, are required to seek preclearance for any changes in voting qualifications, standards, practices or procedures from the U.S. District Court for the District of Columbia, or from the U.S. Attorney General, prior to their implementation. Section 4 of the Act provides that a covered jurisdiction may seek to “bail out,” or remove itself from such coverage, and therefore be exempted from the preclearance requirements, by seeking a declaratory judgment before a three-judge panel in U.S. District Court for the District of Columbia. A bailout judgment can be issued only if the court determines that the jurisdiction meets certain eligibility requirements for bailout contained in the statute, including a 10-year record of nondiscrimination in voting-related actions. The act also provides that the attorney general can consent to entry of a judgment of bailout only if, based upon investigation, the attorney general is satisfied that the jurisdiction meets the eligibility requirements.

The city of Wheatland filed its bailout action in the U.S. District Court for the District of Columbia on Jan. 14, 2013. City officials had contacted the attorney general prior to filing its action, indicating that the City was interested in seeking a bailout. The city provided the Justice Department with substantial information, and the department conducted an investigation to determine the city’s eligibility. Based on that investigation, the department is satisfied that the city of Wheatland meets the Voting Rights Act’s requirements for bailout.  

“In the Voting Rights Act, Congress provided a means for a covered jurisdiction to be exempted from the preclearance requirements of Section 5 if the jurisdiction meets the specific eligibility requirements of the Act,” said Matthew Colangelo, Deputy Assistant Attorney General for the Civil Rights Division. “I am pleased that city officials worked cooperatively with the department in providing the information we requested and in resolving this matter in the way envisioned by the Voting Rights Act.”

The consent decree details the legal and factual basis for a bailout determination and, if approved, will grant the city’s request. The court will retain jurisdiction of the action for 10 years and can reopen the action upon the motion of the attorney general or any aggrieved person alleging conduct by the city that would have originally precluded a bailout if it had occurred during the 10 year period preceding entry of the consent decree.  

Information about bailout, the Voting Rights Act, and other federal voting laws is available on the Department of Justice website at www.justice.gov/crt/voting . Complaints may be reported to the Voting Section of the Justice Department’s Civil Rights Division at 1-800-253-3931.

Hospice of Arizona L.C., along with a related entity, American Hospice Management LLC, and their parent corporation, American Hospice Management Holdings LLC, have agreed to pay $12 million to resolve allegations that they violated the False Claims Act by submitting or causing the submission of false claims to the Medicare program for ineligible hospice services, the Justice Department announced today.

The Medicare hospice benefit is available for patients who have a life expectancy of six months or less if their disease runs its normal course. Patients admitted to a hospice stop receiving care to cure their illnesses and instead receive medical care focused on providing them with relief from the symptoms, pain, and stress of a terminal illness. Today’s settlement resolves allegations that Hospice of Arizona, and its related entities, submitted or caused the submission of false Medicare claims between Sept. 1, 2002, and Dec. 31, 2010, for Hospice of Arizona patients who did not need end of life care or for whom the hospice billed at a higher reimbursement rate than it was entitled.

The government alleged that Hospice of Arizona and its related entities, engaged in certain practices that resulted in the admission of ineligible patients or inflated bills, including pressuring staff to find more patients eligible for Medicare, adopting procedures that delayed and discouraged staff from discharging patients from hospice when they were no longer appropriate for such services, and not implementing an adequate compliance program that might have addressed these problems. As part of the settlement, American Hospice Management Holdings has agreed to enter into a corporate integrity agreement with the Inspector General of the Department of Health and Human Services that provides for procedures and reviews to be put in place to avoid and promptly detect conduct similar to that which gave rise to the settlement.

“This settlement is the result of the Justice Department’s efforts to prevent the misuse of the taxpayer-funded Medicare hospice program, which is intended to provide comfort and care to terminally ill persons at the end of their lives,” said Stuart F. Delery, Principal Deputy Assistant Attorney General for the Department of Justice’s Civil Division.

“The hospice industry relies on the Medicare Trust Fund, and payments for unnecessary services jeopardize its financial viability,” said U.S. Attorney for the District of Maryland Rod J. Rosenstein.

“Medicare and taxpayers depend on hospice agencies to provide medically appropriate services to terminally ill patients,” said Glenn R. Ferry, Special Agent in Charge of the U.S. Department of Health and Human Services Office of Inspector General’s region including Arizona. “When providers place more importance on the bottom line than on the care of these vulnerable patients, they can expect to face serious penalties.”

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 $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 a former Hospice of Arizona, L.C. employee, Ellen Momeyer, 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 for false claims and share in any recovery. The whistleblower in this case will receive $1.8 million. The case is United States ex rel. Momeyer v. Hospice of Arizona, L.C., et al., No. 1:10-cv-280 (D. Md.).

This matter was handled by the Justice Department’s Civil Division, the U.S. Attorney’s Office for the District of Maryland, and the Office of the Inspector General for the Department of Health and Human Services.

The claims settled by this agreement are allegations only; there has been no determination of liability.

Sean Rosales pleaded guilty in Miami federal court to one count of an indictment pending against him, charging conspiracy to commit mail and wire fraud, the Justice Department and the U.S. Postal Inspection Service announced today.

Rosales, a dual United States and Costa Rican citizen charged in connection with the operation of a series of fraudulent business opportunities, was arrested in Chicago late last year following his indictment by a federal grand jury in Miami on Nov. 29, 2011. Rosales was arrested based on charges that he and his co-conspirators purported to sell beverage and greeting card business opportunities, including assistance in establishing, maintaining and operating such businesses. The indictment is part of the government’s continued nationwide crackdown on business opportunity fraud.

Eleven other individuals have been charged in connection with business opportunity fraud ventures based in Costa Rica. Rosales is the eighth of those individuals to be convicted in the United States.

“The Department of Justice is committed to cracking down on financial fraud, including business opportunity fraud schemes,” said Stuart F. Delery, Principal Deputy Assistant Attorney General for the Justice Department’s Civil Division. “That is why we will continue to prosecute those who would deprive innocent, hardworking Americans of their hard-earned money by offering phony business opportunities.”

Beginning in May 2005, Rosales and his coconspirators fraudulently induced purchasers in the United States to buy business opportunities in USA Beverages Inc., Twin Peaks Gourmet Coffee Inc., Cards-R-Us Inc., Premier Cards Inc., The Coffee Man Inc. and Powerbrands Distributing Company. The business opportunities cost thousands of dollars each, and most purchasers paid at least $10,000. Each company operated for several months, and after one company closed, the next opened. The various companies used bank accounts, office space and other services in the Southern District of Florida and elsewhere.

Rosales, using aliases, participated in a conspiracy that used various means to make it appear to potential purchasers that the businesses were located entirely in the United States. In reality, Rosales operated out of Costa Rica to fraudulently induce potential purchasers in the United States to buy the purported business opportunities.

The companies made numerous false statements to potential purchasers of the business opportunities, including that purchasers would likely earn substantial profits; that prior purchasers of the business opportunities were earning substantial profits; that purchasers would sell a guaranteed minimum amount of merchandise, such as greeting cards and beverages; and that the business opportunity worked with locators familiar with the potential purchaser’s area who would secure or had already secured high-traffic locations for the potential purchaser’s merchandise stands. Potential purchasers also were falsely told that the profits of some of the companies were based in part on the profits of the business opportunity purchasers, thus creating the false impression that the companies had a stake in the purchasers’ success and in finding good locations.

The companies employed various types of sales representatives, including fronters, closers, and references. A fronter spoke to potential purchasers when the prospective purchasers initially contacted the company in response to an advertisement. A closer subsequently spoke to potential purchasers to finalize deals. References spoke to potential purchasers about the financial success they purportedly had experienced since purchasing one of the business opportunities. The companies also employed locators, who were typically characterized by the sales representatives as third parties who worked with the companies to find high-traffic locations for the prospective purchaser's merchandise display racks.

Rosales, using aliases, was a fronter for USA Beverages, a fronter and reference for Twin Peaks, a fronter and reference for Cards-R-Us, a fronter, locator and reference for Premier Cards, a locator for Coffee Man, and a locator for Powerbrands.

Each of the companies was registered as a corporation and rented office space to make it appear to potential purchasers that its operations were fully in the United States. USA Beverages was registered as a Florida and New Mexico corporation and rented office space in Las Cruces, N.M. Twin Peaks was registered as a Florida and Colorado corporation and rented office space in Fort Collins, Colo., and Cards-R-Us was registered as a Nevada corporation and rented office space in Reno, Nev. Premier Cards was registered as a Colorado and Pennsylvania corporation and rented office space in Philadelphia, and The Coffee Man was registered as a Colorado corporation and rented office space in Denver. Powerbrands was registered as a Wisconsin corporation and rented office space in Glendale, Wisconsin and Palm Beach Gardens, Fla.

“Fraudulent business opportunity sellers must realize that financial fraud victimizing Americans will be prosecuted vigorously, even if the schemers conduct their fraudulent operations from abroad,” said Wifredo A. Ferrer, U.S. Attorney for the Southern District of Florida. “Increased international law enforcement cooperation eliminates safe havens for those who cheat American citizens from overseas.”

“ The success of this investigation shows that the U.S. Postal Inspection Service is committed to working with the Department of Justice and our law enforcement partners, both foreign and domestically, to protect the American consumer from the predatory nature of business opportunity schemes ,” said Tony Gomez, Acting U.S. Postal Inspector in Charge in Miami.

Principal Deputy Assistant Attorney General Delery commended the investigative efforts of the Postal Inspection Service. The case is being prosecuted by Assistant Director Jeffrey Steger and trial attorney Alan Phelps with the U.S. Department of Justice Consumer Protection Branch.

The Department of Justice announced last week that it has entered into a settlement agreement with the McDuffie County Schools in Georgia to modify the zoning of the district’s elementary schools and ensure the school district complies with other obligations to desegregate its schools in the areas of student assignment, faculty recruiting and assignment and transportation.

The consent order, if approved by the court, requires the district to alter the elementary school zones in order to increase the number of African-American students in the de jure white school, where the enrollment has remained majority white and disproportionate to the racial composition of the district as a whole. The consent order also requires the district to eliminate racial disparities in how teachers and staff are assigned to the district’s schools and to engage in affirmative efforts to recruit African-American personnel. The consent order also contains provisions for student transfers, gifted and talented programs, discipline, transportation, and monitoring and reporting. Finally, the district will establish a diversity advisory council to evaluate and monitor the implementation of the zone changes and the district’s continued efforts toward desegregation. The consent order allows the district, upon demonstration of successful implementation of the provisions in the order, to move for unitary status on Dec. 15, 2015.

“We applaud the McDuffie County Schools for agreeing to take prompt voluntary corrective actions to ensure that it fully meets its desegregation obligations in three years,” said Jocelyn Samuels, Principal Deputy Assistant Attorney General for the Civil Rights Division. “The Civil Rights Division will continue to work to ensure that McDuffie and all school districts under federal desegregation orders fully eliminate the vestiges of segregation in their schools.”

Edward J. Tarver, U.S. Attorney for the Southern District of Georgia, said, “I admire the McDuffie County School District’s efforts in working to amicably resolve what were once highly contentious issues in our society. The United States Attorney’s Office will provide assistance to the School District and the Civil Rights Division to ensure continued compliance with this Consent Order.”

The enforcement of the Equal Protection Clause and Title IV of the Civil Rights Act of 1964 in school districts is a top priority of the Justice Department’s Civil Rights Division. Additional information about the Civil Rights Division of the Justice Department is available on its website at www.justice.gov/crt

Executives at two Arlington, Va.-based businesses have pleaded guilty to fraudulently obtaining more than $31 million in government contract payments that should have gone to disadvantaged small businesses.

 The guilty pleas were announced today by U.S. Attorney for the Eastern District of Virginia Neil H. MacBride, Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and NASA Inspector General Paul K. Martin.

 “These executives used their knowledge and experience to abuse a program created to ensure minority small business owners could compete for government contracts,” said U.S. Attorney MacBride. “They not only illegally obtained millions from the United States, they also victimized legitimate minority owners who didn’t get the bids.”

“Keith Hedman and his co-conspirators fraudulently obtained valuable government contracts intended for minority-owned small businesses, and pocketed millions of dollars for themselves,” said Acting Assistant Attorney General Raman.  “They abused an important government program, and will now face the consequences.”

“This investigation confirmed that these executives repeatedly took actions that gave them a fraudulent advantage in the contracting process,” said NASA Inspector General Martin.  “I commend the outstanding efforts of our agents and our law enforcement partners involved in this case in protecting the integrity of the 8(a) program.”

 According to court documents, Keith Hedman, 53, of Arlington, formed an Arlington-based security service consulting company in approximately 2001.  Hedman formed the company, listed as Company A in court filings, with an African-American woman who was listed as its president and CEO to enable the company to participate in the Small Business Administration’s (SBA) Section 8(a) program, which enables certain small businesses to receive sole-source and competitive-bid contracts set aside for minority-owned and disadvantaged small businesses.  In 2001, Hedman’s company received approval to participate in the 8(a) program on the basis of the African-American president and CEO’s listed role, but when she left the company in 2003, Hedman became its sole owner and the company was no longer 8(a)-eligible.

 Hedman admitted that in 2003 he created a shell company, listed as Company B in court records, to ensure he could continue to gain access to 8(a) contracting preferences for which Company A was not qualified.  Prior to applying for the shell company’s 8(a) status, Hedman selected an employee, Dawn Hamilton, 48, of Brownsville, Md., to serve as a figurehead owner based on her Portuguese heritage and history of social disadvantage, when in reality the new company would be managed by Hedman and senior leadership at Company A.  To deceive the SBA, they falsely claimed that Hamilton formed and founded the company and that she was the only member of the company’s management.  They continued to mislead the SBA through 2012, even lying to the SBA to overcome a protest filed by another company accusing Hedman’s former company and the shell company of being inappropriately affiliated.

 From Company B’s creation through February 2012, Hedman – not Hamilton – exercised ultimate decision-making authority and control over the company by controlling its finances, allocation of personnel and government contracting activities.  Hedman nonetheless maintained the impression that Hamilton was leading the company, including through forgeries of signatures by Hamilton to documents she had not seen or drafted.  Hedman also retained ultimate control over the shell business’s bank accounts throughout its existence.  In 2011, Hedman withdrew $1 million in cash from Company B’s accounts and gave the funds in cash to Hamilton and three other co-conspirators. In total, Hedman and Hamilton secured through the shell company more than $31 million in government contract payments, which generated more than $6 million in salary and payments for the conspirators that they were not entitled to receive.

 In addition, Hedman admitted that he agreed to pay a $50,000 bribe through the shell business to a U.S. government contracting official for the official’s help in securing contracts for Company B.

 Hedman and Hamilton pleaded guilty on March 13 and March 15, 2013, respectively, in U.S. District Court for the Eastern District of Virginia to major government fraud and face a maximum penalty of 10 years in prison and a multimillion-dollar fine for that charge. Hedman also pleaded guilty to conspiracy to commit bribery, which carries a maximum penalty of five years in prison.  Hedman agreed to forfeit more than $6.3 million, and Hamilton agreed to forfeit more than $1.2 million.  Hedman is scheduled to be sentenced on June 21, 2013, before U.S. District Judge Gerald Bruce Lee.  Hamilton’s sentencing is scheduled for June 21, 2013, before U.S. District Judge T. S. Ellis, III.

 In addition, the following individuals have also pleaded guilty to major fraud or conspiracy to commit major fraud:

• David George Lux, 62, of Springfield, Va., pleaded guilty today before U.S. District Judge Leonie M. Brinkema.  Lux served as the chief financial officer at Company A from 2007 through February 2012 and performed work for Company B throughout that time while officially on Company A’s payroll.  He is scheduled to be sentenced on June 14, 2013, by Judge Brinkema.

• Joseph Richards, 51, of Arlington, pleaded guilty on March 14, 2013, before U.S. District Judge Brinkema in the Eastern District of Virginia.  Richards served as the chief operating officer and chief of staff for Company A from 2005 through 2008 and then vice president from 2010 through February 2012.  He also served as Company B’s chief of staff from 2008 through 2010.  According to court documents, Richards performed work for Company B throughout his time at both companies. He is scheduled to be sentenced on June 14, 2013, by Judge Brinkema.

• David Sanborn, 60, of Lexington, S.C., pleaded guilty on March 13, 2013, before U.S. District Judge Claude M. Hilton in the Eastern District of Virginia.  Sanborn served as vice president at Company A from 2001 through 2009 and the company’s president from 2010 through February 2012.  According to court documents, Sanborn performed work for Company B from its inception while on Company A’s payroll.  He is scheduled to be sentenced on June 28, 2013, by Judge Hilton.

 This case was investigated by the NASA Office of the Inspector General (OIG), the SBA OIG, the Defense Criminal Investigative Service, the General Services Administration OIG and the Department of Homeland Security OIG.  Assistant U.S. Attorneys Chad Golder and Ryan Faulconer, a former Trial Attorney for the Criminal Division’s Fraud Section, are prosecuting the case on behalf of the United States.

The Justice Department announced today that it will monitor elections on March 19, 2013, in Beaufort, Berkeley, Charleston and Dorchester Counties, S.C., and in the village of Port Chester, N.Y. The monitoring will ensure compliance with the Voting Rights Act of 1965, which 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. Port Chester is required to provide assistance in Spanish.

Under the Voting Rights Act, the Justice Department is authorized to ask the U.S. Office of Personnel Management (OPM) to send federal observers to jurisdictions that are certified by the attorney general or by a federal court order. Federal observers will be assigned to monitor polling place activities in Dorchester County based on the attorney general’s certification and in Port Chester based on a court order. The observers will watch and record activities during voting hours at polling locations in these jurisdictions, and Civil Rights Division attorneys will coordinate the federal activities and maintain contact with local election officials.

In addition, Justice Department personnel will monitor polling place activities in Beaufort, Berkeley, and Charleston Counties in South Carolina. Civil Rights Division attorneys will coordinate federal activities and maintain contact with local election officials.

In January 2008, a federal district court found that Port Chester’s at-large method of electing the village board of trustees violated the Voting Rights Act and prevented Hispanic voters from participating equally in the electoral process, resolving a lawsuit filed by the department’s Civil Rights Division and the U.S. Attorney’s Office for the Southern District of New York. In November 2009, the court ordered that a cumulative voting system be adopted to remedy this violation, and in December 2009, the department and the village entered into a consent decree, which was approved by the court. The consent decree includes an extensive voter education plan with education and training provisions to ensure that the voters in Port Chester are fully familiar with cumulative voting. The decree also requires that bilingual poll officials will be present at every polling place in Port Chester, and that all election-related materials must be translated into Spanish. The March 2013 election will be the second municipal election since the entry of the consent decree.

Each year, the Justice Department deploys hundreds of federal observers from OPM, 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.

Tyrone Thompson was sentenced today to 137 months in prison by U.S. District Judge Hugh Lawson in the Middle District of Georgia for conspiracy and filing fraudulent tax returns in order to receive tax refunds, to which the defendant was not entitled, the Justice Department and Internal Revenue Service (IRS) announced. In addition to Thompson, the scheme involved four others who had already been sentenced. Judge Lawson also ordered Thompson to pay $516,363 in restitution to the IRS. In October 2012, all five defendants pleaded guilty to filing a false claim for tax refunds. In addition, Thompson pleaded guilty to conspiracy to file false claims for tax refunds.

According to court documents, Thompson organized a scheme in which he prepared and filed fraudulent federal income tax returns using the names of other individuals. He included with the returns fictitious Schedules C reporting business income and losses and also claimed false First-Time Homebuyer Credits, in order to obtain tax refunds to which he and his co-defendants were not entitled. He directed fraudulently-obtained refunds to be deposited to his co-defendants’ bank accounts. The attempted tax refund fraud exceeded $400,000.

“Today’s lengthy jail sentence sends a strong message that those who would consider committing tax fraud should think carefully about the serious risks involved,” said Assistant Attorney General for the Justice Department’s Tax Division Kathryn Keneally. “As millions of honest, hard-working taxpayers prepare and file their tax returns, they should be assured that those who would shirk their civic duty or try to ‘game the system’ will be investigated by the IRS and, where appropriate, criminally prosecuted by the Department of Justice.”

“These folks are stealing from every good tax paying citizen, and we won’t tolerate it,” said U.S. Attorney for the Middle District of Georgia Michael J. Moore.

“Tyrone Thompson organized a scheme to file fraudulent tax returns using the identities of third parties in order to receive false refunds,” said Richard Weber, Chief, IRS Criminal Investigations. “Mr. Thompson cheated the government by filing false Schedule C and false First-Time Homebuyer Credit forms to increase the fraudulent tax refunds. IRS Criminal Investigation has made investigating refund fraud a top priority and we will vigorously pursue those who undermine the integrity of the U.S. tax system.”

Assistant Attorney General Keneally commended the efforts of Special Agents of IRS - Criminal Investigation, who investigated the case, and Trial Attorneys Charles Edgar and Alexander Effendi of the Tax Division, who prosecuted the case.

BALTIMORE --Immigration Judge Elizabeth A. Kessler 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 March 15, 2013. The Baltimore District Office of U.S. Citizenship and Immigration Services, Department of Homeland Security, hosted the ceremony.

Biographical Information

Attorney General Alberto Gonzales appointed Judge Kessler in January 2006. Judge Kessler received a bachelor of arts degree in 1987 from Columbia University, a master of arts degree in 1992 from Yale Graduate School, and a juris doctorate in 1992 from Yale Law School. From 2003 to 2006, she served as a deputy associate attorney general at the Department of Justice (DOJ). She previously served as a deputy general counsel for the U.S. Department of Energy. From 1997 to 1999, Judge Kessler served as general counsel, U.S. Senate Judiciary Committee, Subcommittee on Immigration in Washington, D.C. From 1995 to 1997, she served as counsel, U.S. Senate Judiciary Committee. From 1993 to 1994, Judge Kessler was an attorney, Civil Division, Appellate Staff, at DOJ and a Bristow Fellow, Office of the Solicitor General. From 1992 to 1993, she served as a law clerk with Judge Richard J. Cardamone, U.S. Court of Appeals for the 2nd Circuit. Judge Kessler 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.

The Department of Justice has granted a request by the White Earth Nation for the United States to assume concurrent criminal jurisdiction on the 1,300 square mile White Earth reservation in northern Minnesota, Deputy Attorney General James M. Cole announced today.

The decision was the first action of its kind under the landmark Tribal Law and Order Act of 2010 (TLOA), which granted the Justice Department discretion to accept concurrent federal jurisdiction to prosecute major crimes within areas of Indian country that are also subject to state criminal jurisdiction under Public Law 280.  Public Law 280 is the 1953 law that mandated the transfer of federal law enforcement jurisdiction for certain tribes to six states, including Minnesota.  The decision, relayed yesterday in a letter to the tribe signed by Deputy Attorney General Cole, will take effect on June 1, 2013.  Tribal, state, and county prosecutors and law enforcement agencies will also continue to have criminal jurisdiction on the reservation. 

“Our goal in granting this request is to strengthen public safety and security for the people of White Earth,” said Deputy Attorney General Cole.  “We look forward to partnering with the tribe and our state and local counterparts to support White Earth in ensuring justice on the reservation.” 

“The public safety challenges facing our tribal communities are serious and complex,” said U.S. Attorney for the District of Minnesota B. Todd Jones. “The United States Attorney’s Office will continue working closely and collaboratively with our tribal and local partners towards our common goal – improving public safety.  It is our hope that with the additional jurisdiction, our Office will be able to support our tribal and county partners for the benefit of all communities.”

The Department of Justice already has jurisdiction to prosecute crimes such as drug trafficking and financial crimes wherever they occur in the United States – including on the White Earth reservation.  The change announced today will expand this existing jurisdiction on the reservation to allow federal prosecution of major crimes such as murder, rape, felony assault and felony child abuse.

The decision followed careful consideration of the request and information provided by the White Earth Nation, as well as by the Justice Department’s Office of Tribal Justice, the Executive Office for United States Attorneys, the U.S. Attorney's Office for the District of Minnesota, the FBI, the U.S. District Court, state and local law enforcement partners and other sources.

Two California men have been charged in an indictment unsealed today in Boston with remotely hacking into merchants’ computerized cash registers in order to obtain fraudulent gift cards, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney Carmen M. Ortiz for the District of Massachusetts and Resident Agent in Charge Holly Fraumeni of the U.S. Secret Service (USSS) Manchester, N.H. Office

Shahin Abdollahi, aka “Sean Holdt,” 46, of Lake Elsinore, Calif., and Jeffrey Thomas Wilkinson, 35, of Rialto, Calif., were both charged with one count of conspiracy to commit computer intrusion and wire fraud, and one count of wire fraud.
 
According to the indictment, Abdollahi owned Subway franchises in Southern California from 2005 to 2008, and later operated a California company called “POS Doctor,” which sold and installed point-of-sale (POS) computer systems to Subway restaurant franchises around the country.  POS systems are a type of computerized checkout register that allows merchants to manage customer purchases made by credit, debit and gift cards.

The indictment alleges that beginning in approximately 2011, Abdollahi and Wilkinson conspired to remotely hack into POS systems in Subway restaurant franchises around the country.  According to the indictment, members of the conspiracy hacked into at least 13 Subway POS systems that Abdollahi sold through POS Doctor and fraudulently added at least $40,000 in value to Subway gift cards.  Abdollahi and Wilkinson allegedly used the fraudulent gift cards to make purchases at Subway, and Wilkinson also allegedly sold fraudulent gift cards to others using eBay and Craigslist.

The case was investigated by the USSS and is being prosecuted by Trial Attorney Mona Sedky of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Adam J. Bookbinder of the District of Massachusetts.

The charges contained in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

A former medical director for Biscayne Milieu, a Miami-based mental-health clinic, was sentenced today to serve 144 months in prison for his role in a fraud scheme involving the submission of more than $50 million in fraudulent billings to Medicare, announced Acting Assistant Attorney General Mythili Raman 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.

Dr. Gary Kushner, 72, of Plantation, Fla., was sentenced by U.S. District Judge Robert N. Scola Jr. in the Southern District of Florida.  In addition to the prison term, Kushner was ordered to serve three years of supervised release.
 
Kushner was convicted on Aug. 28, 2012, of one count of conspiracy to commit health care fraud and one substantive count of health care fraud, following a two-month jury trial.

According to the evidence at trial, Kushner and his co-conspirators caused the submission of over $50 million dollars in false and fraudulent claims to Medicare through Biscayne Milieu, which purportedly operated a partial hospitalization program (PHP) – a form of intensive treatment for severe mental illness.  Instead of providing legitimate PHP services, the defendants devised a scheme in which they paid patient recruiters to refer ineligible Medicare beneficiaries to Biscayne Milieu for services that were never provided or were not properly reimbursable by Medicare.  Many of the patients admitted to Biscayne Milieu were not eligible for PHP because they were chronic substance abusers, suffered from severe dementia and would not benefit from group therapy, or had no mental health diagnosis but were seeking exemptions for their U.S. citizenship applications. 

The evidence at trial further showed that, as Biscayne Milieu’s medical director, Kushner authorized the treatment of patients that he knew were ineligible for PHP treatment.  Biscayne Milieu then billed Medicare for millions of dollars in PHP treatments for these patients under Kushner’s name.  Evidence further revealed that Kushner would often conduct cursory examinations lasting only minutes before authorizing such fraudulent billings. 

Various owners, doctors, managers, therapists, patient brokers and other employees of Biscayne Milieu have also been charged with various health care fraud, kickback, money laundering and other offenses in two indictments unsealed in September 2011 and May 2012.   Biscayne Milieu, its owners and more than 25 of the individual defendants charged in these cases have pleaded guilty or have been convicted at trial.  Antonio and Jorge Macli and Sandra Huarte – the owners and operators of Biscayne Milieu – were each convicted at trial of various offenses and are scheduled for sentencing in April 2013.

This case is being prosecuted by Assistant U.S. Attorneys Michael Davis, Marlene Rodriguez and James V. Hayes of the U.S. Attorney’s Office for the Southern District of Florida; James V. Hayes was formerly a Trial Attorney in the Criminal Division’s Fraud Section.  The case was investigated by the FBI with the assistance of HHS-OIG, and was brought by the U.S. Attorney’s Office for the Southern District of Florida in coordination with the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,480 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.

Attorney General Eric Holder announced today $1.8 million in new resources to improve access to criminal legal services and strengthen indigent defense across the nation. In remarks during the “50 Years Later: The Legacy of Gideon v. Wainwright” event hosted by the Department of Justice, the Attorney General emphasized the department’s commitment to ensuring that all those accused of a crime, regardless of their wealth, education or class, have adequate legal representation and counsel. March 18th marks the 50th Anniversary of the U.S. Supreme Court’s landmark decision in Gideon v. Wainwright, where the court unanimously ruled that even those unable to afford counsel are entitled to counsel by court appointment. At today’s event, Attorney General Holder led a discussion on keeping and continuing the promise of Gideon, which included U.S. Supreme Court Justice Elena Kagan and former Vice President Walter Mondale, who, as Minnesota Attorney General in 1963, organized the submission of the amicus curiae brief to the U.S. Supreme Court with 21 state attorneys general in support of Clarence Gideon.

 “Despite half a century of progress, far too many Americans still struggle to gain access to the legal assistance they need, and far too many children and adults enter our justice systems with little understanding of their rights,” said Attorney General Holder. “This is unacceptable and unworthy of a legal system that stands as an example for the world. I’m proud to say that today’s Justice Department is rising to the challenge to confront the obstacles facing indigent defense providers.”

Acting Associate Attorney General Tony West also delivered remarks about reclaiming Gideon’s petition at today’s ceremony.

 “The constitutional right to counsel is a cornerstone of our criminal justice system,” said Acting Associate Attorney General Tony West.  “It’s a principle that resides at the core of our concept of equal justice under the law, to which the Department of Justice remains deeply committed.  Gideon reminds us that justice is as much a journey as it is a destination -- as much a process as it is an outcome -- and that we must give equal attention to both.”
 
 At the event, Attorney General Holder discussed the importance of the Department’s Access to Justice Initiative, which he launched in 2010, to address the access to justice crisis in the criminal and civil justice system and help ensure that the justice system delivers outcomes that are fair to everyone, regardless of wealth and status. Strengthening the indigent defense system is among the Initiative’s priorities. 

“Fair treatment and justice are the right of everyone, no matter what their income,” said Deborah Leff, Acting Senior Counselor of the Access to Justice Initiative.  “Clarence Earl Gideon won a victory in the U.S. Supreme Court for all Americans.  It is now our responsibility to make sure that Gideon’s promise is fulfilled.”

The following Bureau of Justice Assistance (BJA) initiatives were a part of today’s announcement:

• $720,000 toward the upcoming grant solicitation, Answering Gideon’s Call: National Assistance to Improve the Effectiveness of Right to Counsel Services, which will enable an organization to work directly with states and counties to improve their ability to provide quality representation to indigent defendants and implement innovative strategies.
• $540,000 for two new jurisdictions, chosen by BJA, from last year’s Answering Gideon’s Call solicitation that will improve public defender and other indigent defense systems. The two new jurisdictions will join four jurisdictions, selected last year, to receive assistance with improving the capacity of indigent defense systems and increase the knowledge base about those systems.
• $140,000 toward opportunities through BJA’s National Training and Technical Assistance Center (NTTAC) that will provide technical assistance to help jurisdictions meet their constitutional obligation and provide adequate representation to indigent defendants.  Additionally, these funds will support an initiative that will collect data to help determine ineffective components of criminal justice systems, and enable stakeholders, including district attorneys and judges, to join public defenders in the call for more manageable caseloads and to ensure adequate time is devoted to their clients.

The following Office of Juvenile Justice and Delinquency Prevention (OJJDP) solicitation was also part of today’s announcement:

• $400,000 for the Office of Justice Programs’ Office of Juvenile Justice and Delinquency Prevention competitive solicitation, Juvenile Indigent Defense National Clearinghouse. This award will support the improvement of juvenile indigent defense by providing a broad range of activities and services to improve the overall level of systemic advocacy, improving the quality of juvenile indigent defense representation and ensuring professional and ongoing technical support to the juvenile indigent defense bar.

For more information on the DOJ’s Access to Justice Initiative, which works to strengthen and improve legal services for disadvantaged groups, please visit: www.justice.gov/atj and www.justice.gov/atj/gideon/.

Related Materials:

Attorney General Eric Holder Speaks at the Justice Department's 50th Anniversary Celebration of the U.S. Supreme Court Decision in Gideon v. Wainwright
Acting Associate Attorney General Tony West Speaks at the Justice Department's 50th Anniversary Celebration of the U.S. Supreme Court Decision in Gideon v. Wainwright

An employee of the Department of Health and Human Services’ Office of the Assistant Secretary for Preparedness and Response (HHS-ASPR) pleaded guilty today in Washington, D.C., to defrauding the United States by submitting fraudulent employment offers in order to claim retention bonuses totaling $138,875, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division . 

Michael A. Balady , 62, of Springfield, Va., pleaded guilty before U.S. District Judge Rudolph Contreras in the District of Columbia to a criminal information charging him with one count of wire fraud.

According to court documents, Balady worked in the HHS-ASPR first as the director of acquisition management systems in ASPR’s Biological Advanced Research and Development Authority and later as the acting director of ASPR’s Office of Acquisitions, Management, Contracts and Grants. As part of his plea, Balady admitted that he conspired with an employee of a communications firm based in Alexandria, Va., to fabricate employment offers for a position with that firm in order to justify retention bonuses paid to him by HHS. Retention bonuses are monetary incentives paid by HHS to employees deemed essential to its mission who would be likely to leave in the absence of such a bonus.

From 2009 until 2012, Balady improperly received retention bonus payments totaling $94,940. In June 2012, HHS approved another retention bonus in the amount of $38,875, but that bonus was never paid to Balady. As part of the plea agreement, Balady resigned from HHS and has agreed to pay restitution to HHS in the amount of $94,940.

At sentencing, scheduled for June 12, 2013, Balady faces up to 20 years in prison and a fine of $250,000.

This case is being prosecuted by Trial Attorneys Richard B. Evans and Mark Angehr of the Criminal Division’s Public Integrity Section, and is being investigated by the HHS Office of the Inspector General.

Former Congressional candidate Justin Lamar Sternad pleaded guilty today in Miami to violating the Federal Election Campaign Act during his 2012 campaign, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney for the Southern District of Florida Wifredo A. Ferrer and Michael B. Steinbach, Special Agent in Charge of the FBI’s Miami Field Office.

Sternad, 35, of Miami, pleaded guilty before U.S. District Court Judge Robin S. Rosenbaum in the Southern District of Florida.  Sternad pleaded guilty to all counts of a criminal information that charged him with one count of conspiracy to make false statements to the Federal Election Commission (FEC), one count of making false statements to the FEC and one count of accepting illegal campaign contributions.

 Sternad was a candidate in the 2012 Democratic Party primary election for Florida’s 26th Congressional District.  According to court documents, Sternad engaged in a conspiracy to accept illegal campaign contributions and file false statements with the FEC in order to conceal the true source, amount and nature of the funds used by his campaign. 

Sternad admitted that his campaign accepted cash and checks in excess of Federal Election Campaign Act limits and that he filed statements that intentionally misled the FEC about his campaign’s activities.  During the campaign, illegal cash contributions from co-conspirators were used to pay for a rental car and the design, printing and distribution of campaign flyers. 

According to court documents, Sternad reported to the FEC that he made loans to his campaign in the amount of $63,801, when he knew that he had actually loaned fewer than $300.   In total, Sternad accepted over $70,000 in misreported campaign contributions.

 At sentencing, scheduled for May 31, 2013, Sternad faces a maximum penalty of five years in prison and a fine up to $250,000 on each count.

The case is being prosecuted by Senior Litigation Counsel Thomas J. Mulvihill of the U.S. Attorney’s Office for the Southern District of Florida and Richard C. Pilger, Director of the Election Crimes Branch of the Criminal Division’s Public Integrity Section.

The United States and the city of New Orleans announced today that public meetings would be held regarding a consent decree court monitor for the New Orleans Police Department (NOPD). The United States and the city of New Orleans on Sept. 6, 2012 issued a request for proposals to serve as the consent decree court monitor for NOPD. In response, the United States and the city of New Orleans received 12 proposals. The United States and the city of New Orleans formed an evaluation committee to evaluate those proposals and select a consent decree court monitor. The committee met publicly on March 7, 2013 and selected five candidates to be interviewed for the position. Those five candidates are:

1.       The Bromwich Group

2.       Elite Performance Assessment Consultants LLC

3.       Hillard Heintze

4.       OIR Group

5.       Sheppard Mullin

The proposals submitted by each of these candidates can be found at www.justice.gov/crt/about/spl/ and at http://new.nola.gov/purchasing/consent-decree/ . On April 2 and April 3, 2013 beginning at 8 a.m. CST, the Evaluation Committee will hold public meetings in which each of these candidates will be interviewed. The meetings will be held in the Superdome, in the Bienville Club Lounge. The Bienville Club Lounge can be accessed through the Gate B plaza level entrance in Garage 1.

There also will be opportunities for public comment at the meetings on April 2 and 3. At those meetings, each monitor candidate will be allowed to make a presentation of up to 30 minutes. Following each presentation, the public will be given up to 30 minutes in which to comment. Following the public comments, the evaluation committee may spend up to one hour asking questions of the monitor candidates.

If you wish to provide written comments about the process or the prospective monitor, you are encouraged to submit those comments by email to New Orleans City Attorney Richard Cortizas at [email protected] . Please note “Re: NOPD Consent Decree Court Monitor” in the e-mail subject line. Comments also may be mailed or hand-delivered to the following address:

City of New Orleans Attorney

City of New Orleans

Re: NOPD Consent Decree Court Monitor

1300 Perdido St.

New Orleans 70112

The Department of Justice and the city of New Orleans will review any comments received by March 29, 2013, prior to the presentations. All written comments must be provided by 12:00 p.m. CDT on April 8, 2013. The city of New Orleans will file copies of all public comments received in the electronic record of United States of America v. City of New Orleans, Civil Action No. 12-1924 (E.D. La.).

Teva Pharmaceuticals USA Inc. has agreed to pay a $2.25 million civil penalty to settle alleged violations of the federal Clean Air Act (CAA), Clean Water Act (CWA), and the Resource Conservation and Recovery Act (RCRA), as well as the Missouri Air Conservation Law, Clean Water Law and Hazardous Waste Management Law at its facility in Mexico, Mo., announced the Department of Justice, the Environmental Protection Agency (EPA) and the Missouri Department of Natural Resources today. 

A 2007 inspection of the Missouri facility revealed violations of the CAA.  The violations included failure to control emissions of hazardous air pollutants from wastewater and failure to comply with regulations designed to prevent leaks of air pollutants from equipment at the facility.

In 2007, an EPA inspection found the Teva facility was discharging pollutants above permitted levels established by the City of Mexico’s Pretreatment Program, in violation of the CWA. In some cases, these pollutants were causing interference with the city’s ability to treat its domestic sewage, leading to pollutant discharges into the Salt River.  A 2008 inspection found that Teva was discharging a green effluent that ultimately discolored a portion of the Salt River in November and December 2008.

In 2009, an inspection by the Missouri Department of Natural Resources uncovered various RCRA violations.  These violations included failure to determine if waste was hazardous, illegal storage of hazardous waste, failure to comply with labeling requirements and offering hazardous waste for transport without a manifest.

“This settlement penalizes Teva for multiple violations of U.S. environmental laws when it allowed excess emissions of hazardous air pollutants from Teva’s wastewater treatment facility and excess discharges of pollutants into the City of Mexico, Missouri’s wastewater treatment facility,” said Ignacia S. Moreno, the Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division.  “The agreement is protective of human health and the environment because it requires Teva to offset its excess emissions, install modern equipment that will increase the recovery and reuse of hazardous pollutants and reduce air emissions, as well as enhance its leak prevention capability.”

“With numerous violations over a period of years, Teva’s actions resulted in significant environmental damage to the air and water,” said EPA Region 7 Administrator Karl Brooks.  “The penalty and injunctive relief required by this agreement send a strong message to Teva and others that businesses must comply with environmental laws.”

Teva’s $2.25 million penalty includes a $1.125 million payment to the U.S. Treasury and a $1.125 million payment to the State of Missouri.

In addition to the penalty, Teva will complete other actions at the facility valued at approximately $2.5 million.  These include the installation of equipment to recover and reuse approximately 59.5 tons of methylene chloride and reduce other emissions by 19 tons over a five-year period.  Teva will also conduct an audit to identify past causes of CWA violations, implement a program to prevent leaks of hazardous air pollutants at the facility, take actions to prevent future violations and implement an Environmental Management System with third party monitoring.

As a result of this Consent Decree, Teva has certified that it is in full compliance with CAA, CWA and RCRA regulations. 
  
The proposed settlement will be lodged in the U.S. District Court for the Eastern District of Missouri and is subject to a public comment period and final court approval. The consent decree can be viewed at the Department of Justice website: www.justice.gov/enrd/Consent_Decrees.html
 
Learn more about EPA’s civil enforcement of the Clean Air Act:  www.epa.gov/air/caa/
 
Learn more about EPA’s civil enforcement of the Clean Water Act:  www.epa.gov/compliance/civil/cwa/index.html
 
Learn more about EPA’s civil enforcement of RCRA:  www.epa.gov/compliance/civil/rcra/index.html

The Justice Department announced today that it has opened a pattern or practice investigation into use of force by the Cleveland Division of Police (CPD). The investigation will focus on allegations that CPD officers use excessive force, including unreasonable deadly force, and on the adequacy of CPD’s training, supervision, and accountability mechanisms that are essential to effective, constitutional policing.

The Justice Department’s investigation will determine whether CPD officers engage in a pattern or practice of using excessive force in violation of the Constitution and federal law. This investigation will include a comprehensive review of CPD’s policies, procedures, training, accountability systems, and community engagement. As part of this investigation, the Justice Department will reach out to community members and groups for help in identifying potential problems within the police department.

Department officials have met with Cleveland Mayor Frank Jackson, CPD Chief Michael McGrath, and Director of Public Safety Martin Flask and will continue to work closely with both the city and CPD as the investigation progresses.

“Police officers across the country are called upon to protect and safeguard members of their communities and are afforded the authority they need to do so, including the authority to use deadly force,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “It is absolutely imperative that officers use that authority responsibly and within the boundaries of the law. We are eager to work together with the city of Cleveland and its police department to help ensure that its officers are best serving the individuals they are sworn to protect.”

“As we begin this process, our commitment to this community and this city is to conduct a thorough and fair investigation,” said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio. “Our joint goal cannot be to invent tough issues, nor can we hide from them if they exist. The Mayor, among others, requested this investigation, and we hope that with the continued cooperation of the city and the community we can ensure Cleveland’s residents receive top notch police protection.”

The Violent Crime Control and Law Enforcement Act of 1994 prohibits state and local governments from engaging in a pattern or practice of misconduct by law enforcement officers that deprives individuals of federally-protected rights. The act also allows the Justice Department to remedy such misconduct through civil litigation. The Justice Department has conducted similar investigations and has obtained important reforms in police departments and law enforcement agencies across the country.

The Special Litigation Section of the Justice Department’s Civil Rights Division, in Washington, D.C., and the U.S. Attorney’s Office for the Northern District of Ohio, in Cleveland, are jointly conducting this investigation. Individuals with relevant information are encouraged to contact the Justice Department via email at [email protected] or by phone at (202) 307-6479.

Additional information about the Civil Rights Division is available on its website at www.justice.gov/crt . Additional information about the U.S. Attorney’s Office for the Northern District of Ohio is available on its website at www.justice.gov/usao/ohn .

Related Materials:

Assistant Attorney General Thomas E. Perez Speaks at the Cleveland Police Department Press Conference

A Texas doctor was sentenced today to serve 63 months in prison for conspiring to commit health care fraud by falsifying plans of care for Medicare beneficiaries, including patients whom he did not treat, as part of a $17.3 million Medicare fraud scheme.

Today’s sentence was announced by Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division; U.S. Attorney Kenneth Magidson of the Southern District of Texas; Special Agent in Charge Stephen L. Morris of the FBI’s Houston Field Office; Special Agent in Charge Mike Fields of the Dallas Regional Office of U.S. Department of Health and Human Services (HHS) Office of Inspector General (OIG), Office of Investigations; and the Texas Attorney General’s Medicaid Fraud Control Unit. 

 Ben Harris Echols, 63, of Houston, was sentenced by U.S. District Judge Sim Lake of the Southern District of Texas.  In addition to his prison term, Echols was sentenced to serve three years of supervised release and ordered to pay $2,918,830 in restitution.
               
After a four-day trial, a jury convicted Echols on Dec. 13, 2012, of one count of conspiracy to commit health care fraud and six counts of false statements relating to health care matters.

According to evidence presented at trial, Echols was a physician practicing in the Houston area.  Evidence showed that Echols signed plans of care for Medicare beneficiaries so that fraudulent claims could be billed by home health care companies Family Healthcare Group Inc. and Houston Compassionate Care.  Echols signed plans of care for Medicare beneficiaries who were not under his care and about whose conditions he had no knowledge.  In many instances, Echols signed plans of care even though other doctors were listed as the attending physician on the documents. 

Evidence presented at trial showed that Family Healthcare Group Inc. and Houston Compassionate Care fraudulently billed Medicare for home health services and were paid approximately $17.3 million by Medicare, including $5.5 million for beneficiaries for whom Echols signed a plan of care.

The case was prosecuted by Trial Attorneys Alexander H. Berlin, Abigail B. Taylor and Assistant Chief Joseph S. Beemsterboer of the Criminal Division’s Fraud Section, with assistance from Criminal Division Trial Attorneys Kyle Maurer and Alison Anderson.  The case was investigated by the FBI, HHS-OIG, and the Texas Attorney General’s Medicaid Fraud Control Unit.

The case 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 Texas.  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.

 A former web producer for a Tribune Company-owned television station in Sacramento, Calif., was charged today in an indictment for allegedly conspiring with members of the hacker group “Anonymous” to hack into and alter a Tribune Company website, the Justice Department announced.
 
 Matthew Keys, 26, of Secaucus, N.J., was charged in the Eastern District of California with one count each of conspiracy to transmit information to damage a protected computer, transmitting information to damage a protected computer and attempted transmission of information to damage a protected computer. 
 
 Keys was employed by Sacramento-based television station KTXL FOX 40, as its web producer, but was terminated in late October 2010.
 
 The three-count indictment alleges that in December 2010 Keys provided members of the hacker group Anonymous with log-in credentials for a computer server belonging to KTXL FOX 40’s corporate parent, the Tribune Company.  According to the indictment, Keys identified himself on an Internet chat forum as a former Tribune Company employee and provided members of Anonymous with a login and password to the Tribune Company server.  After providing log-in credentials, Keys allegedly encouraged the Anonymous members to disrupt the website.  According to the indictment, at least one of the computer hackers used the credentials provided by Keys to log into the Tribune Company server, and ultimately that hacker made changes to the web version of a Los Angeles Times news feature.
 
 The indictment further alleges that Keys had a conversation with the hacker who claimed credit for the defacement of the Los Angeles Times website.  The hacker allegedly told Keys that Tribune Company system administrators had thwarted his efforts and locked him out.  Keys allegedly attempted to regain access for that hacker, and when he learned that the hacker had made changes to a Los Angeles Times page, Keys responded, “nice.”
 
 Each of the two substantive counts carry a maximum penalty of 10 years in prison, three years of supervised release and a fine of $250,000.  The conspiracy count carries a maximum penalty of five years in prison, three years of supervised release and a fine of $250,000.
 
 The charges contained in the indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
 
 This case was investigated by the Sacramento and Los Angeles Field Offices of the FBI.  The case is being prosecuted by the Criminal Division’s Computer Crime and Intellectual Property Section and the U.S. Attorney’s Office for the Eastern District of California.

A federal court has permanently barred Crystal Ireland, of Detroit, who does business as Master Mind Preparation, from preparing federal tax returns that claim the earned income tax credit, the Justice Department announced today. The civil injunction order, to which Ireland consented, was signed by Judge Bernard Friedman of the U.S. District Court for the Eastern District of Michigan.

The complaint in the case alleged that Ireland failed to comply with due diligence requirements imposed by federal law on tax preparers who claim the earned income credit on customers’ returns. According to the complaint, Ireland fabricated businesses and reported fake business income on her customers’ tax returns in order to claim the maximum credit for them.

The complaint alleged that the Internal Revenue Service penalized Ireland in 2010 for failing to comply with federal law due diligence requirements, yet a 2011 follow-up investigation revealed ongoing failures and fraudulent claims. According to the complaint, Ireland prepared at least 2,300 returns from 2008 through 2011, with unusually high refund rates ranging from 97 to 99 percent for those years.

The permanent injunction order also bars Ireland from preparing forms Schedule C on which she knowingly fabricates income or expenses, preparing tax returns on which she knowingly claims a dependent that does not actually qualify as a dependent of the taxpayer, and preparing tax returns on which she fails to identify herself as the paid preparer or falsely identifies someone else as the paid preparer.

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. Crystal E. Ireland, etc.
Order of Permanent Injunction Against Crystal E. Ireland (PDF)

Eight individuals face federal charges stemming from a joint U.S. Fish and Wildlife Service and Missouri Department of Conservation investigation of interstate and international trafficking in paddlefish “caviar,” the Department of Justice Environment and Natural Resources Division and the U.S. Attorney for the Western District of Missouri announced.  Arkadiy Lvovskiy, Dmitri Elitchev, Artour Magdessian, Felix Baravik, Petr Babenko, Bogdan Nahapetyan, Fedor Pakhnyuk and Andrew Praskovsky have been charged in four, separate indictments in the Western District of Missouri for acts that occurred in 2011 and 2012.

The American paddlefish (Polydon spathula), also called the Mississippi paddlefish or the “spoonbill,” is a freshwater fish that is primarily found in the Mississippi River drainage system.  Paddlefish eggs are marketed as caviar.  Paddlefish were once common in waters throughout the Midwest.  However, the global decline in other caviar sources, such as sturgeon, has led to an increased demand for paddlefish caviar.  This increased demand has led to over-fishing of paddlefish, and consequent decline of the paddlefish population.

Missouri law prohibits the transportation of paddlefish eggs which have been removed or extracted from a paddlefish carcass.  Missouri law also prohibits the sale or purchase, or offer of sale or purchase, of paddlefish eggs. There are also several restrictions on the purchase and possession of whole paddlefish in Missouri.

Among other things, the Lacey Act makes it unlawful for any person to import, export, transport, sell, receive, acquire or purchase fish that were taken, possessed, transported or sold in violation of any law or regulation of any state, or to attempt to do so. Such conduct constitutes a felony crime if the defendant knowingly engaged in conduct involving the purchase or sale, offer to purchase or sell or intent to purchase or sell, fish with a market value in excess of $350, knowing that the fish were taken, possessed, transported or sold in violation of, or in a manner unlawful under, a law or regulation of any state.

Arkadiy Lvovskiy, 51, of Aurora, Colo., Dmitri Elitchev, 46, of Centennial, Colo., Artour Magdessian, 46, of Lone Tree, Colo., and Felix Baravik, 48, of Aurora, Colo., were charged with conspiring with each other, and others, to violate the Lacey Act, and with trafficking in paddlefish and paddlefish eggs in violation of the Lacey Act.  The indictment alleges that in the spring of 2011 and 2012, the defendants traveled to Warsaw, Mo., where they engaged in multiple, illegal purchases of paddlefish and processed the eggs from those paddlefish into caviar.  After processing the paddlefish eggs into caviar, the defendants transported the caviar from Missouri to Colorado.  The indictment further alleges that, during the interstate transportation, the defendants engaged in counter-surveillance efforts in order to avoid being detected.

Petr Babenko, 42, of Vineland, N.J., and  Bogdan Nahapetyan, 33, of Lake Ozark, Mo., were charged with conspiring with each other and other individuals  to violate the Lacey Act, and with trafficking in paddlefish and paddlefish eggs in violation of the Lacey Act.  The indictment alleges that between March and April 2012, the defendants traveled to Warsaw where they engaged in multiple, illegal purchases of paddlefish and processed the eggs from those paddlefish into caviar.  After processing the paddlefish eggs into caviar, they transported the caviar from Missouri to New Jersey. 

Fedor Pakhnyuk, 39, of Hinsdale, Ill., is charged with two counts of trafficking in paddlefish and paddlefish eggs in violation of the Lacey Act.  According to the indictment, in the spring of 2011 and 2012 Pakhnyuk traveled from Illinois to Missouri for the purpose of obtaining paddlefish eggs.  The indictment alleges that Pakhnyuk procured paddlefish eggs by purchasing them, and by performing processing services for other persons in exchange for a share of the processed eggs.  After processing the paddlefish eggs into caviar, Pakhnyuk transported the caviar from Missouri to Illinois.  The indictment alleges that Pakhnyuk also attempted to form an enterprise with other individuals that would market processed paddlefish caviar at markets in Chicago, Illinois.

Andrew Praskovsky, 40, of Erie, Colo., is charged with two counts of trafficking in paddlefish and paddlefish eggs in violation of the Lacey Act.  According to the indictment, in March and April 2012, Praskovsky twice traveled to Warsaw for the purpose of purchasing paddlefish.  After processing the paddlefish eggs into caviar, Pakhnyuk transported the caviar from Missouri to Kansas.  The indictment alleges that, in April 2012, Praskovsky attempted to export some of the paddlefish eggs in checked luggage on an international flight departing from Dulles International Airport in Washington, D.C.  The paddlefish eggs were seized at Dulles, as paddlefish eggs may only be exported if they are accompanied by a valid permit issued by the U.S. Fish & Wildlife Service under the Convention for International Trade in Endangered Species (CITES).

If convicted, the individual defendants face a maximum penalty of five years in prison, and a $250,000 fine per count, as well as forfeiture of any vehicles that were used during the commission of the crimes.

The case was investigated by the U.S. Fish and Wildlife Service and the Missouri Department of Conservation, with assistance by the Oklahoma Department of Wildlife Conservation. The case is being prosecuted by Trial Attorneys James B. Nelson and Adam C. Cullman of the Department of Justice’s Environmental Crimes Section and Supervisory Assistant U.S. Attorney Lawrence E. Miller of the U.S. Attorney’s Office for the Western District of Missouri.

An indictment is a formal accusation and is not proof of guilt. Defendants are presumed innocent until and unless they are found guilty.

John Hall, 27, an Aryan Brotherhood member and inmate at the Federal Correctional Institution (FCI) in Seagoville, Texas, was sentenced today by U.S. District Judge Reed O’Connor after pleading guilty to violating the Matthew Shepard and James Byrd Jr. Hate Crimes Prevention Act stemming from his assault of a fellow inmate, whom he believed to be gay, the Department of Justice announced. Hall assaulted his fellow inmate with a dangerous weapon, causing bodily injury to the victim on Dec. 20, 2011. Hall was sentenced to serve 71 months in prison to be served consecutively with the sentence he is currently serving.

The assault occurred on Dec. 20, 2011, inside the FCI Seagoville when Hall targeted and attacked the victim, a fellow inmate, because he believed the victim was gay or involved in a sexual relationship with another male inmate. Hall repeatedly punched, kicked and stomped on the victim’s face with his shod feet, a dangerous weapon, while yelling a homophobic slur. The victim lost consciousness during the assault and suffered multiple lacerations to his face. The victim also sustained a fractured eye socket, lost a tooth, fractured other teeth and was treated at a hospital for the injuries he sustained during Hall’s unprovoked attack. Hall pleaded guilty to violating the Matthew Shepard and James Byrd Jr. Hate Crimes Prevention Act on Nov. 8, 2012.

“Brutality and violence based on sexual orientation has no place in a civilized society,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “The Justice Department is committed to using all the tools in our law enforcement arsenal, including the Matthew Shepard and James Byrd Jr. Hate Crimes Prevention Act, to prosecute acts motivated by hate.”

“This prosecution sends a clear message that this office, in partnership with attorneys in the department’s Civil Rights Division, will prioritize and aggressively prosecute hate crimes and others civil rights violations in North Texas,” said U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.

This case was investigated by the FBI Dallas Division. The case was prosecuted by Assistant U.S. Attorney Errin Martin and Trial Attorney Adriana Vieco of the Civil Rights Division.

Vice President Joe Biden and Attorney General Eric Holder today announced grants to 12 programs across the country to target the urgent need to reduce domestic violence homicides.  On average, three women a day die as a result of domestic violence   Research shows that women whose partner threatens them with a gun or other weapon are 20 times more likely to subsequently be murdered than other abused women.  Moreover, children, coworkers, neighbors and police officers are also killed as a result of domestic violence. From 2009 to 2012, 40 percent of mass shootings – those with four or more victims killed – started with the murderer targeting their girlfriend, wife or ex-wife. 

In total, the Department of Justice will award $2.3 million to 12 sites across the country as part of the new Domestic Violence Homicide Prevention Demonstration Initiative (DVHP Initiative).  The DVHP Initiative, created by the Justice Department’s Office on Violence Against Women, (OVW) helps state and local jurisdictions reduce domestic violence homicides by effectively identifying potential victims and monitoring high-risk offenders.  The DVHP Initiative is modeled after programs in Massachusetts and Maryland, where the use of coordinated teams of law enforcement, prosecutors, health professionals and victims’ services significantly reduced the domestic violence homicide rate. 

“Every single day in America, three women die at the hands of their boyfriend, or their husband, or their ex-husband. Many of these women have been threatened or severely abused in the past. We know what risk factors put someone in greater danger of being killed by the person they love – and that also means we have the opportunity to step in and try to prevent these murders. That’s why these grants are so important. They’ll help stop violence before it turns deadly,” said Vice President Biden.

 “Domestic violence is a devastating crime – and it claims far too many lives each and every day,” said Attorney General Holder.  “With today’s grant announcement, we are strengthening our ability to fight back more effectively – and aggressively – than ever before.  And we’re supporting the kinds of evidence-based domestic violence homicide prevention models that will allow us to reliably predict potentially lethal behavior, take steps to stop the escalation of violence and save lives.”

 The Vice President and Attorney General announced the grant awards in Rockville, Md., where they were joined by dozens of Maryland law enforcement officers who have been at the forefront of domestic violence homicide prevention efforts in that state.

“While the statistics seem overwhelming, we are not helpless in the face of these terrible crimes,” said Acting Director of Office on Violence Against Women Bea Hanson. “We hope this evidence-based initiative to reduce domestic violence homicide is a breakthrough in preventing murders and serious injuries across the country.”

The new DVHP Initiative is based on an assessment tool that researchers have identified that can be used to reliably recognize women who may be in fatally abusive relationships.  Attempted strangulation, threats with weapons, sexual assault and obsessively jealous and controlling behavior are among the markers of particularly lethal abusers.  Once at-risk victims are identified, law enforcement, prosecutors, courts and service providers can take action to protect them and their families. 

Since passage of the Violence Against Women Act (VAWA) in 1994, annual rates of domestic violence have dropped by more than 60 percent, but more work remains to reduce the most serious of this violence.  OVW is partnering with the National Institute of Justice to rigorously monitor the implementation of the initiative and evaluate its outcomes. OVW is also working with national experts to provide technical assistance to the demonstration sites. 

The demonstration sites, each receiving one-year awards ranging from $100,658 to $200,000, are: Contra Costa County, Calif.; Miami-Dade County, Fla.; Palm Beach County, Fla.; Rockdale County, Ga.; Winnebago County, Ill.; Boston; Brooklyn, N.Y.; Westchester County, N.Y.; Pitt County, N.C.; Cuyahoga County, Ohio; North Charleston, S.C.; and Rutland, Vt.  After the 12-month assessment phase, up to six of the demonstration sites will be selected to continue a three-year implementation phase.

Click HERE for the fact sheet the Obama Administration’s commitment to reducing domestic violence homicides.  

Click HERE for the fact sheet on the link between common sense efforts to reduce gun violence and preventing domestic violence homicides.

Related Materials:

Attorney General Eric Holder Speaks at the Domestic Violence Homicide Prevention Initiative Announcement

Bruce King, the founder and operator of Premier Tax, was sentenced today in Montgomery, Ala., to 70 months in prison and ordered to pay $781,305 in restitution to the Internal Revenue Service (IRS) for orchestrating a tax fraud scheme at his business, the Justice Department and the IRS announced. King had previously pleaded guilty to charges of conspiring to defraud the United States and filing false tax returns.

According to court documents, Premier Tax was a tax preparation business operated by King that had several locations in Alabama and Georgia. King held training sessions in which he taught preparers how to falsify tax returns in order to fraudulently increase clients’ tax refunds. Those he taught went on to work at Premier Tax and filed numerous false tax returns. According to court documents, the tax loss caused by these fraudulent returns exceeded $1 million. To date, seven return preparers trained by King have also pleaded guilty and been sentenced.

This case was investigated by special agents of the IRS - Criminal Investigation. Trial Attorneys Jason Poole and Justin Gelfand of the Justice Department’s Tax Division and Assistant U.S. Attorney Jared Morris are prosecuting this case.

Additional information about the Tax Division and its enforcement efforts may be found at www.justice.gov/tax.

Norman Teltow, owner of Gold Metal Paint Co. LLC (GMP), pleaded guilty late yesterday in Denver to a criminal information charging him with illegally treating hazardous waste at the company’s facility, the Justice Department announced.  Teltow, who will be sentenced on June 10, 2013, faces a maximum sentence of five years in prison, a $250,000 fine, and three years of supervised release.
 
Teltow operated GMP out of a hangar near the Front Range Airport in Watkins, Colo.  GMP was primarily in the business of painting small aircraft.  During the course of its business, GMP created hazardous waste in the form of spent methylene chloride-based solvents mixed with paint waste.  Methylene chloride, a listed hazardous waste, is both ignitable and toxic.  Moreover, exposure to methylene chloride can cause skin irritation, headache, dizziness, nausea, and vomiting. 
 
Under the Resource Conservation and Recovery Act, GMP was required to use a licensed waste management company to transport the hazardous waste to a licensed facility for disposal.  To avoid the costs associated with proper disposal, Teltow directed GMP employees to store the spent solvents in an underground tank below the facility, knowing that it was illegal to store the waste in that manner. 

When the Colorado Department of Public Health and Environment (CDPHE) became aware that Teltow and GMP were storing hazardous waste in an underground tank, the agency conducted an inspection and ordered Teltow to hire a licensed waste management company to pump the waste out of the tank and dispose of it properly.  CDPHE further ordered that the tank be cleaned, that the trench drain leading to the underground tank be sealed, and that GMP use a licensed waste management company to transport all hazardous waste in the future.  In response to CDPHE’s orders, Teltow hired a licensed waste management company to pump out the tank, and sealed off the trench drain to the underground tank.  However, rather than hire a licensed waste management company to clean out the tank, Teltow ordered subordinate employees to clean out the tank without the benefit of any personal protective equipment.  The employees were exposed to hazardous waste containing methylene chloride, and suffered from headaches, dizziness, and nausea.  

Teltow then devised a new plan for treating GMP’s hazardous waste by “evaporating” it into the atmosphere.  Teltow ordered subordinate GMP employees to pour the hazardous waste onto the floor of the hangar at the end of the work day.  Workers would then leave the hangar doors ajar and allow the methylene-chloride waste to evaporate.  Teltow knew that it was illegal to treat the hazardous waste in this manner.   When Teltow’s “evaporation” method was unsuccessful at treating all of the waste that GMP accumulated, Teltow drilled open the trench drain so that the waste could again flow into the underground tank. 

“The illegal handling of hazardous waste threatens public safety and the environment and puts workers in harms way,” said Jeffrey Martinez, Special Agent in Charge of EPA’s criminal enforcement program in Colorado.  “The defendant admits that he attempted to make hazardous waste ‘disappear’ by ordering his workers to allow spent solvents to evaporate and to clean up hazardous chemicals without protective safety gear, putting the workers at great risk.  Although this case centers on the illegal treatment of hazardous materials, it’s really about the defendant trying to save a buck by cutting corners.”

The investigation was conducted by the Environmental Protection Agency, Criminal Investigation Division, with assistance from inspectors at the Occupational Safety and Health Administration and CDPHE.  The case was prosecuted by James B. Nelson of the Department of Justice’s Environmental Crimes Section

The Justice Department announced today that, as part of its Barrier-Free Health Care Initiative, it has reached a settlement with Glenbeigh Hospital of Rock Creek, Ohio, under the Americans with Disabilities Act (ADA).  The settlement resolves allegations that Glenbeigh violated the ADA by denying admission to someone because of HIV.  This is the fourth settlement that the Justice Department has reached in six weeks addressing HIV discrimination by a medical provider.

The Justice Department found that Glenbeigh unlawfully refused to admit someone with HIV into its alcohol treatment program because of the side effects of his HIV medication. Glenbeigh’s alcohol treatment program consists of helping patients through the physical aspects of recovery, as well as providing counseling and incorporating spiritual healing. The department determined that Glenbeigh cannot show that treating the complainant would have posed a direct threat to the health or safety of others.

“Ensuring access to medical care for people with HIV requires that those in the medical field make medical decisions that are not based on fears or stereotypes,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “The ADA does not tolerate HIV discrimination and neither will the Justice Department.”

“Our office is committed to vigorously enforcing the ADA, including for those with HIV,” said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio. “This settlement should send a clear message that those with HIV are entitled to the same services, including medical treatment, as everyone else.”

Under the settlement, Glenbeigh must pay $32,500 to the complainant and $5,000 in civil penalties.  In addition, Glenbeigh must train its staff on the ADA and develop and implement an anti-discrimination policy. 

In the past five weeks, the department announced similar agreements with Woodlawn Family Dentistry, the Castlewood Treatment Center, and the Fayetteville Pain Center to address HIV discrimination. All four 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] .

Veteran District of Columbia defense attorney Charles F. Daum was sentenced today to serve 63 months in prison on three counts of obstructing justice in a federal drug trafficking case, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division; Chief Cathy L. Lanier of the Washington, D.C., Metropolitan Police Department; and Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office. 

Daum, 66, of Arnold, Md., was sentenced before Senior U.S. District Judge Gladys Kessler in the District of Columbia.  In addition to Daum’s prison sentence for obstruction of justice, he was sentenced to a concurrent term of 60 months in prison on one count of conspiracy to obstruct justice and two counts of subornation of perjury.  Daum was also sentenced to serve one year of supervised release. 

“Daum went to extraordinary lengths to purposefully subvert the legal process in his client’s case,” said Acting Assistant Attorney General Raman.  “He fabricated evidence and knowingly presented perjured testimony, betraying his profession and our system of justice.  Today’s significant prison sentence is appropriate punishment for his crimes.”

“Through a scheme of his own design, Mr. Daum purposefully concocted false evidence and submitted it to the court,” said Assistant Director in Charge Parlave.  “Today’s sentence demonstrates our diligence in protecting our judicial system from those individuals who attempt to violate its integrity.”

 The charges resulted from Daum’s representation of Delante White, who was indicted in March 2008 by the U.S. Attorney’s Office for the District of Columbia on federal drug trafficking charges following the execution of a search warrant on Feb. 23, 2008, at the home of White’s grandmother.  After a six-week bench trial, Judge Kessler found beyond a reasonable doubt that after entering his notice of appearance in the case, Daum devised a plan to obtain and produce false evidence designed to convince the jury that the drugs seized by the police on Feb. 23, 2008, did not belong to White.  Daum enlisted the help of co-conspirators Daaiyah and Iman Pasha, whom Daum had hired as investigators, and others to help carry out his scheme.  Following Daum’s directions, the co-conspirators obtained duplicates of several items that were seized as evidence during the execution of the search warrant, including a digital scale, a razor blade, plates, an Adidas shoe box and a pair of Gucci boots.  Once those items were obtained, Daaiyah and Iman Pasha made arrangements to take staged photographs of White’s brother depicted with the items, while apparently “cutting” “rock cocaine” in order to make it appear as though the seized drugs actually belonged to the brother.  Daum later submitted the staged photographs, as well as other fabricated items, as evidence during White’s criminal trial.   Judge Kessler also found that Daum solicited and presented the perjured testimony of two witnesses, in order to further obstruct and impede the administration of justice.

Private investigators Daaiyah Pasha, 62, of Washington, D.C., and Iman Pasha, 33, of Springfield, Va., were also sentenced today by Judge Kessler.  Daaiyah Pasha was sentenced to serve three months in prison and three years of supervised release.  Iman Pasha was sentenced to serve three months probation.

 The case was prosecuted by Trial Attorneys Darrin L. McCullough, Donnell Turner and Tritia Yuen of the Criminal Division’s Narcotic and Dangerous Drug Section.  The case was investigated by the Washington, D.C., Metropolitan Police Department, the FBI and the U.S. Attorney’s Office for the District of Columbia.

A federal court has granted the United States’ request to permanently bar James M. Unterreiner II from preparing tax returns, the Justice Department announced today. According to the government complaint, from 2002 until 2003, Unterreiner worked for Tax Resolutions Inc., where he assisted owner Irvin H. Catlett Jr. and others in marketing a tax evasion scheme in which Tax Resolutions’ clients made investments in various sham companies and reported bogus tax losses. Unterreiner consented to the injunction.

As the Justice Department previously announced , testimony heard at Catlett’s nine-day criminal trial in 2010 showed that Tax Resolutions prepared fraudulent tax returns for its clients that included fictitious business losses which Tax Resolutions falsely claimed resulted from automobile leasing and sales. The fake losses reduced the amount of taxable income and total tax reported by Tax Resolutions’ clients. As a result, the clients falsely claimed refunds from the Internal Revenue Service (IRS).

Testimony at that trial also showed that Unterreiner assisted Catlett and helped perpetuate the scheme by preparing client tax returns by first determining each client’s tax and then adding to the return a fictitious loss from a tax shelter entity large enough to reduce the client’s tax due to zero. Unterreiner continued the scheme even after Catlett was imprisoned on other charges. As a result of the scheme, approximately 275 tax returns were filed with the IRS which reported bogus losses, resulting in a tax loss to the United States in excess of $3 million.

In addition to barring Unterreiner from preparing tax returns for life, the injunction also bars Unterreiner from representing others before the IRS, as well as the a dvising, assisting, counseling, or instruction of anyone about the preparation of any federal income tax return.

Related Materials:

United States v. James M. Unterreiner II
Complaint (PDF)
Stipulation for Final Permanent Injunction and Order (PDF)
 

WASHINGTON – The Department of Justice’s Antitrust Division issued the following statement today in connection with the closing of its investigation into the proposed transaction that would combine T-Mobile USA Inc. and MetroPCS Communications Inc.: After a thorough review of the proposed transaction, the Antitrust Division has determined that the combination of T-Mobile and MetroPCS is unlikely to harm consumers or substantially lessen competition and has closed its investigation.

In this transaction, T-Mobile–one of four nationwide providers of mobile wireless services–will merge with MetroPCS, a provider in only certain regions of the country.  As the department alleged in its 2011 case challenging the proposed merger of AT&T Inc. and T-Mobile, many dimensions of competition in the mobile wireless industry take place at a national level, including plan pricing, device offerings and network technology.  Like many local and regional providers, MetroPCS faces limitations, stemming from its lack of nationwide spectrum, networks and scale, and therefore exerts little influence on these aspects of mobile wireless competition.

The department considered whether the proposed combination of T-Mobile and MetroPCS might tend to lessen competition substantially in any particular local area, for instance by combining the two carriers with the best local coverage.  MetroPCS has a network based on high frequency spectrum (i.e. advanced wireless services (AWS) and personal communications services (PCS) spectrum) that is less able to cover rural areas or penetrate buildings.  It does not provide a particularly unique and competitively significant differentiated offering in the regions in which it operates.  Each of the markets served by MetroPCS is also served by all four national carriers.  Accordingly, the transaction is not likely to lessen competition substantially at local levels.

Finally, the proposed combination of T-Mobile and MetroPCS may have a procompetitive impact in that it improves T-Mobile’s scale and spectrum position, particularly since MetroPCS’s spectrum holdings are compatible with T-Mobile’s existing network.

The department said that it will continue to monitor competition in the mobile wireless industry and to bring enforcement actions where warranted. 

 
T-Mobile is a Delaware corporation headquartered in Bellevue, Wash.  T-Mobile is the fourth-largest mobile wireless telecommunications services provider in the United States as measured by subscribers, and serves approximately 33.3 million wireless connections to wireless devices.  In 2012, T-Mobile earned mobile wireless telecommunications services revenues of approximately $17.2 billion.  T-Mobile is a wholly-owned subsidiary of Deutsche Telekom AG.

Deutsche Telekom AG is a German corporation headquartered in Bonn, Germany.  It is the largest telecommunications operator in Europe with wireline and wireless interests in numerous countries and total annual revenues in 2011 of €58.7 billion.

MetroPCS is a Delaware corporation headquartered in Richardson, Texas.  It is the fifth-largest mobile wireless telecommunications provider in the United States as measured by subscribers, and serves approximately 8.9 million customers.  In 2011, MetroPCS earned mobile wireless telecommunications services revenues of $4.8 billion.

The division provides this statement under its policy of issuing statements concerning the closing of investigations in appropriate cases. This statement is limited by the division’s obligation to protect the confidentiality of certain information obtained in its investigations. As in most of its investigations, the division’s evaluation has been highly fact-specific, and many of the relevant underlying facts are not public. Consequently, readers should not draw overly broad conclusions regarding how the division is likely in the future to analyze other collaborations or activities, or transactions involving particular firms. Enforcement decisions are made on a case-by-case basis, and the analysis and conclusions discussed in this statement do not bind the division in any future enforcement actions. Guidance on the division’s policy regarding closing statements is available at: www.usdoj.gov/atr/public/guidelines/201888.htm.

A federal district judge in Miami permanently barred Marlen Monzon, her son Yanko Rodriguez, and their Miami business, Tri Stars Multiservices Corporation, from preparing federal income tax returns for others, the Justice Department announced today.

According to the government’s complaint, Monzon and Rodriguez prepared federal income tax returns in Miami through Tri Stars Multiservices, Corporation. As alleged, the returns prepared by Monzon and Rodriguez included fabricated claims for business expenses on customers’ returns even when the customers did not own or operate a business. The complaint further alleged that these fabricated expenses offset the customer’s wage income and improperly lowered the customer’s reported taxable income. These fabricated expenses generated (or increased) customers’ refunds, and often qualified customers for credits to which they were not entitled. The complaint alleged that nearly every one of the 498 returns that the Internal Revenue Service (IRS) examined for tax years 2008 through 2011 claimed that the customer operated a business and reported a business loss. According to the complaint, the IRS has determined that the U.S. Treasury lost more than $3.4 million in revenue as a result of Monzon and Rodriguez’s misconduct.

Monzon, Rodriguez and Tri Stars consented to the entry of the injunction.

In the past 10 years 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. Thomas G. Bandzul
Permanent Injunction (PDF)

NEW YORK -- Immigration Judge George Chew 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 March 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 Chew in September 1995. Judge Chew received a bachelor of arts degree in 1972 from City College of New York and a juris doctorate in 1979 from Antioch School of Law. From 1985 to 1995, he was in private practice in New York. From 1981 to 1984, Judge Chew was a partner with the Law Offices of Wong & Chew, also in New York. From 1979 to 1981, he served as a trial attorney for the former Immigration and Naturalization Service in New York. Judge Chew is a member of the New York State Bar.

- 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.

The Justice Department announced today that it will monitor the municipal election on March 12, 2013, in the town of Guadalupe, in Maricopa County, Ariz., to ensure compliance with the Voting Rights Act of 1965.  The Voting Rights Act prohibits discrimination in the election process on the basis of race, color or membership in a minority language group. 

Under the Voting Rights Act, the Justice Department is authorized to ask the U.S. Office of Personnel Management (OPM) to send federal observers to jurisdictions that are certified by the attorney general or by a federal court order.  Federal observers will be assigned to monitor polling place activities in Maricopa County based on the Attorney General’s certification.  The observers will watch and record activities during voting hours in the town of Guadalupe, and a Civil Rights Division attorney will coordinate the federal activities and maintain contact with local election officials.

Each year, the Justice Department deploys hundreds of federal observers from OPM, 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.

A federal district judge in Jacksonville, Fla., permanently barred Thomas G. Bandzul from preparing federal income tax returns for others, the Justice Department announced today.

According to the government complaint, Bandzul repeatedly prepared federal tax returns that unlawfully understated customers’ federal tax liabilities. The suit alleged that the defendant concocted bogus losses, expenses, education credits, business expenses, and charitable contributions, which he falsely reported on his customers’ federal income tax returns.

The suit alleged that the Internal Revenue Service has examined over 250 tax returns prepared by Bandzul and found that over 90 percent of tax returns understated the taxpayer’s liability. According to the complaint, the total harm to the U.S. Treasury caused by Bandzul’s misconduct could exceed $17 million.

In addition, Bandzul allegedly filed returns that claimed a refund larger than what Bandzul had disclosed to the taxpayer. Once the refund was paid, the suit alleged, Bandzul retained the additional amount without the taxpayer’s knowledge.

Bandzul consented to the entry of the injunction.

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 .          

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 March 8, 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.

WASHINGTON – Two Japanese air freight forwarding companies have agreed to plead guilty and to pay criminal fines totaling $18.9 million for their roles in a conspiracy to fix certain fees in connection with the provision of air freight forwarding services for air cargo shipments from Japan to the United States, the Department of Justice announced today. “K” Line Logistics Ltd. has agreed to pay a $3,507,246 criminal fine and Yusen Logistics Co. Ltd. has agreed to pay a $15,428,207 criminal fine.

Including today’s charges, as a result of this investigation, 16 companies have either pleaded guilty or agreed to plead guilty and have agreed to pay criminal fines totaling more than $120 million.

“Consumers were forced to pay higher prices on the goods they buy every day as a result of the noncompetitive and collusive service fees charged by these companies,” said Bill Baer, Assistant Attorney General in charge of the Department of Justice’s Antitrust Division. “Prosecuting these kinds of global, price-fixing conspiracies continues to be a top priority of the Antitrust Division.”

Freight forwarders manage the domestic and international delivery of cargo for customers by receiving, packaging, preparing and warehousing cargo freight, arranging for cargo shipment through transportation providers such as air carriers, preparing shipment documentation and providing related ancillary services.

According to charges filed separately today in the U.S. District Court for the District of Columbia, “K” Line Logistics and Yusen Logistics engaged in a conspiracy to fix and to impose certain freight forwarding service fees, including fuel surcharges and various security fees, charged to customers for services provided in connection with air freight forwarding shipments of cargo shipped by air from Japan to the United States from about September 2002 until at least November 2007.

According to the charges, the companies carried out the conspiracy by, among other things, agreeing during meetings and discussions to coordinate and impose certain freight forwarding service fees and charges on customers purchasing freight forwarding services for cargo shipped by air from Japan to the United States. The department said the companies levied freight forwarding service fees in accordance with the agreements reached and engaged in meetings and discussions for the purpose of monitoring and enforcing adherence to the agreed-upon freight forwarding service fees.

Each company is charged with price fixing in violation of the Sherman Act, which carries a maximum $100 million fine for corporations. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.

Today’s charges are the result of a joint investigation being conducted by the Antitrust Division’s National Criminal Enforcement Section, the FBI’s Washington Field Office and the Department of Commerce’s Office of Inspector General. Anyone with information concerning the price fixing or other anticompetitive conduct in the freight forwarding industry is urged to call the Antitrust Division’s National Criminal Enforcement Section at 202-307-6694 or visit www.justice.gov/atr/contract/newcase.htm or call the FBI’s Washington Field Office at 202-278-2000.

Hungarian nationals Beatrix Boka and Aleksandar Kunkin were sentenced today to serve 36 months and 46 months in prison, respectively, for their roles in moving approximately $550,000 in illicit proceeds derived from an international online marketplace fraud scheme, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and U.S. Attorney Jerry E. Martin for the Middle District of Tennessee. 

Boka, 34, and Kunkin, 40, were sentenced by U.S. District Judge Aleta A. Trauger in the Middle District of Tennessee.  In addition to their prison terms, Boka and Kunkin were each sentenced to serve two years of supervised release and ordered to pay $464,581 in restitution.

Boka and Kunkin each pleaded guilty in November 2012 to one count of conspiracy to commit bank and wire fraud. 

According to testimony at Boka and Kunkin’s plea hearings, members of the conspiracy fraudulently listed vehicles for sale at online marketplaces such as eBay. When victims expressed interest in purchasing the vehicles, co-conspirators sent emails that directed the victims to wire payments to certain bank accounts, and victims never received the vehicles for which they paid.  From May to June 2012, Boka and Kunkin visited Bank of America branches in North Carolina and South Carolina and opened bank accounts under false identities, which were supported by fraudulent identity documents including counterfeit Hungarian passports.  In total, 36 victims sent approximately $550,102 to accounts opened by Boka and Kunkin.  Boka and Kunkin subsequently sent the bulk of the money to co-conspirators located abroad. 

The case is being prosecuted by Assistant U.S. Attorney Byron M. Jones of the Middle District of Tennessee and Trial Attorney Mysti Degani of the Criminal Division’s Computer Crime and Intellectual Property Section.  The case is being investigated by the FBI, the Tennessee Bureau of Investigation, the Metropolitan Nashville Police Department and the Cobb County, Ga., Sheriff’s Department.

FALLS CHURCH, Va. - The Executive Office for Immigration Review (EOIR) today announced the appointment of a second deputy chief immigration judge (DCIJ). Effective March 10, 2013, Assistant Chief Immigration Judge (ACIJ) Edward F. Kelly will become a DCIJ. Judge Kelly will assume direct supervision of the program components in the Office of the Chief Immigration Judge (OCIJ), including the legal unit, the language service unit, the organizational results unit, the chief clerk, and the executive officer.

“Judge Kelly’s appointment as deputy chief immigration judge is in recognition of his tremendous contributions to OCIJ’s efficiencies and services,” said Chief Immigration Judge Brian M. O’Leary. “With his expanded role, I am confident OCIJ will continue to improve our operations and inspire our staff.”

Biographical information follows:

Attorney General Holder appointed Judge Kelly as an ACIJ in March 2011. He received a bachelor of arts degree in 1982 and a juris doctorate in 1987, both from the University of Notre Dame. From November 2009 to March 2011, Judge Kelly served as senior counsel and chief of staff for OCIJ. From 2007 to 2009, he was counsel for operations for OCIJ at EOIR. From 1998 to 2007, Judge Kelly was a senior legal advisor for the Board of Immigration Appeals (BIA), EOIR. From 1995 to 1998, he served as a supervisory attorney and team leader for the BIA. From 1989 to 1993 and again from 1994 to 1995, Judge Kelly was an attorney advisor for the BIA. From 1987 to 1989, he served as an assistant counsel, Subcommittee on Immigration, Refugees, and International Law, U.S. House of Representatives, Washington, D.C. From 1982 to 1984, he served in the U.S. Peace Corps in Gabon, Africa. Judge Kelly is a member of the Virginia State Bar.

- 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.

FALLS CHURCH, Va. - The Executive Office for Immigration Review (EOIR) today announced an important staffing update within the Office of the Chief Immigration Judge (OCIJ). Effective March 10, 2013, Deputy Chief Immigration Judge (DCIJ) Michael C. McGoings will become a member of the Senior Executive Service, continuing to directly supervise the assistant chief immigration judges and the 58 field courts.

“I am so pleased to welcome Judge McGoings into the Senior Executive Service, a corps of government leaders who share a wealth of experience and a true commitment to public service,” said Chief Immigration Judge Brian M. O’Leary. “His well-honed executive skills and broad perspective of government will continue to benefit OCIJ.”

Biographical information follows:

Attorney General Eric Holder appointed Judge McGoings as Deputy Chief Immigration Judge in October 2009. He received a bachelor of arts degree in 1965 from Morgan State University, a master of science degree in 1967 from the University of Illinois, and a juris doctorate in 1973 from The Catholic University of America. From March 1995 to October 2009, Judge McGoings served as an Assistant Chief Immigration Judge. During this time, from February to July 2009, he served as acting Chief Immigration Judge. From 1994 to 1995, Judge McGoings was an associate general counsel serving as Chief of the Enforcement Legal Program and from 1991 to 1994, he was an associate general counsel for the Employer Sanctions and Civil Document Fraud Legal Program at the former Immigration & Naturalization Service (INS). From 1987 to 1990, he worked as assistant general counsel for the former INS. Judge McGoings is a member of the District of Columbia and Pennsylvania 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.

The Justice Department announced today that Chattanooga, Tenn., based nursing home manager Grace Healthcare LLC and its affiliate Grace Ancillary Services LLC (collectively, Grace) have agreed to pay $2.7 million, plus interest, to resolve allegations that they violated the False Claims Act by knowingly submitting or causing the submission to the Medicare and TennCare/Medicaid programs of false claims for medically unreasonable and unnecessary rehabilitation therapy. Grace Ancillary Services LLC provided the therapy in some of the skilled nursing facilities Grace Healthcare LLC owns and/or manages in Tennessee and elsewhere.

The settlement resolves claims that in ten nursing home facilities in which Grace provided physical, occupational, and speech therapy for periods ranging from 2007 through June of 2011, Grace pressured therapists to increase the amount of therapy provided to patients in order to meet targets for Medicare revenue that were set without regard to patients’ individual therapy needs and could only be achieved by billing for a large amount of therapy per patient. As part of the settlement, Grace has agreed to enter into a Corporate Integrity Agreement with the Inspector General of the Department of Health and Human Services that provides for procedures and reviews to be put in place to avoid and promptly detect conduct similar to that which gave rise to the settlement.

“In today’s economic climate, it is more important than ever for the United States to make sure that Medicare and Medicaid funds are spent appropriately,” 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 government health care programs by providing services based on their own financial considerations, rather than the needs of their patients.”

“The continued viability of our federal healthcare benefit programs depends, in large part, on the honesty and integrity of the program participants,” said U.S. Attorney for the Eastern District of Tennessee Bill Killian. “Health care providers must make decisions regarding the level of services to be provided based solely on individual patient need rather than a desire to increase the bottom line. As this settlement demonstrates, when aggressive business practices cross the line into waste and abuse, we are committed to working with our federal and state partners to protect public funds.”

“Medicare does not pay for medically unnecessary rehabilitation services,” said Derrick L. Jackson, Special Agent in Charge at the U.S. Department of Health and Human Services, Office of Inspector General in Atlanta.  “The Inspector General is committed to identifying improper billing to Medicare and Medicaid and returning those dollars to the taxpayers.

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 $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 a former Grace employee 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 whistleblower in this case will receive $405,000. The case is United States of America and State of Tennessee ex rel. Ottinger v. Grace Healthcare, LLC, Grace Ancillary Services, LLC, and John Does 1-5, No. 3:10-cv-83 (E.D. Tenn.).

The case was handled by the Department of Justice’s Civil Division, the U.S. Attorney’s Office for the Eastern District of Tennessee, the Office of the Inspector General of the U.S. Department of Health and Human Services, the Tennessee Attorney General’s Office, and the Tennessee Bureau of Investigation’s Medicaid Fraud Control Unit. This action was supported by the Elder Justice and Nursing Home Initiative, which coordinates the Department’s activities combating elder abuse, neglect and financial exploitation, especially as they impact beneficiaries of Medicare, Medicaid and other federal health care programs.The claims settled by this agreement are allegations only; there has been no determination of liability.