District Not Recorded
The source did not name an office we could identify. These records remain unassigned rather than guessed.
Woman Sentenced in Columbus, Ohio, for Role in Human Trafficking ConspiracyRead the Press Release
WASHINGTON - Maria Terechina, a national of the Russian Federation, was sentenced today in U.S. District Court in Columbus, Ohio, for her role in a human trafficking conspiracy involving guestworkers who worked in hotels as housekeepers and laundry workers. Terechina was sentenced to 12 months in prison and ordered to pay nearly $250,000 in restitution to her victims. After her release from prison, Terechina will be on federal supervised release for three years.
During her guilty plea hearing in April, Terechina admitted that she engaged in the harboring and transporting of dozens of illegal aliens from Russia, Estonia, Belarus, Ukraine, and other Eastern European nations. The guestworkers who labored for Terechina worked in various hotels in and around Columbus. Terechina admitted that she agreed to hold some of the workers’ passports and immigration documents in order to prevent them from leaving their employment. Terechina also admitted that she defrauded the United States of approximately $185,000 in taxes.
“ The defendant participated in a scheme that created a condition of modern-day slavery, using intimidation to deprive the workers of their freedom for her own financial gain,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “ The Department of Justice is committed to vigorously prosecuting cases of human trafficking.”
Carter M. Stewart, the U.S. Attorney for the Southern District of Ohio, stated “We will continue our efforts to stem the rising tide of involuntary servitude by bringing traffickers to justice and working to restore the rights and dignity of human trafficking victims.”
“The FBI is committed to protecting all persons, regardless of nationality, from slave trafficking. Those who profit from such activity should recognize the consequences of their actions,” said Keith L. Bennett, Special Agent in Charge of the Cincinnati Division of the FBI.
Jose A. Gonzalez, Special Agent in Charge, IRS, Criminal Investigations, stated, “Employers who employ illegal aliens and do not withhold employment taxes are victimizing legitimate businesses by creating an unfair competitive advantage.”
The case involving Terechina is related to the case of United States v. Yaroslav Rochniak, et al., in the Western District of Pennsylvania. All six defendants in that case also have pleaded guilty.
The Terechina case was investigated by Special Agents of the FBI; U.S. Immigration and Customs Enforcement; the U.S. Department of Labor, Office of the Inspector General; and the U.S. Department of Treasury, Internal Revenue Service. The case was jointly prosecuted by Assistant U.S. Attorney Daniel A. Brown from the U.S. Attorney’s Office for the Southern District of Ohio, and Trial Attorney Ryan R. McKinstry from the Civil Rights Division of the U.S. Department of Justice.
Vice President of Florida Corporation Sentenced to 108 Months in Prison for Transporting Child PornographyRead the Press Release
WASHINGTON – Jeffrey Robert Libman, the vice president and co-director of Webe Web Corporation, a Florida corporation, was sentenced yesterday to 108 months in prison for transporting child pornography, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division and U.S. Attorney Joyce White Vance of the Northern District of Alabama.
Libman, 43, of Ft. Lauderdale, Fla., pleaded guilty in U.S. District Court in the Northern District of Alabama on Sept. 15, 2010, to 16 counts of transporting child pornography. Libman was also sentenced to lifetime supervised release, to follow his prison term.
According to court documents, Webe Web was the registered owner of the website "www.childsupermodels.com," which purported to be a child modeling website that promoted models 7- through 16-years old and their photographers. It contained hyperlinks to websites containing photographs of individual "child super models" featuring minor female children in various poses and wardrobes. According to court documents, Libman was responsible for building and maintaining these websites.
Libman admitted that the websites pertaining to 16 different children contained illegal images of child pornography. In some of the photos, the victims, all girls aged 8 to 15, were wearing underwear, lingerie, bathing suits and other revealing outfits, and were posed in positions that constituted child pornography.
According to court documents, viewers of the websites could preview a certain number of images for free on the website homepage. If viewers wanted to join the website to access additional photographs, they could purchase a 30-day membership for approximately $30 per month. Libman admitted that the websites depicting the 16 victims generated approximately $1 million in revenue.
Libman also admitted that Webe Web promoted subscriptions to these individual sites through its free advertising website known as Babble Club. On Babble Club’s website, members could receive a free sample of images of the children. According to court documents, the website encouraged the purchase of subscriptions to the individual websites of the children, and hosted discussion boards and groups which were devoted to each individual website. Babble Club members made postings to the discussion boards, which included comments on specific images they liked, the type of clothing and poses they liked, and poetry written to the photographed child. Certain members posted expressions of fondness and devotion for a photographed child.
In April 2010, Webe Web pleaded guilty to one count of conspiracy to produce child pornography and 16 counts of transporting child pornography. The president and co-director of Webe Web, Marc Evan Greenberg, also pleaded guilty in April 2010 to one count of money laundering based on his processing of the proceeds generated by Webe Web through its distribution of images of child pornography. Greenberg is scheduled to be sentenced on Jan. 14, 2011. According to its plea agreement, Webe Web will forfeit $1 million and 19 internet domain names.
According to court documents, the photographs of the 16 victims in this case were taken by Jeff Pierson, a former photographer based in the Birmingham, Ala., area. Pierson pleaded guilty in January 2007 to conspiracy to transport child pornography and transportation of child pornography.
According to his plea agreement, Libman was charged in an unrelated case in the Southern District of Florida. Libman pleaded guilty in September 2009 to one count of receipt of child pornography and was sentenced in November 2009 to 87 months in prison.
This case is being prosecuted by Assistant U.S. Attorneys Jim Phillips and Daniel J. Fortune of the Northern District of Alabama, and Assistant Deputy Chief Alexandra Gelber of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS).
This case was investigated by the FBI and the U.S. Postal Inspection Service. The Document and Media Exploitation Branch of the National Drug Intelligence Center provided assistance in ascertaining the revenue flow of this criminal enterprise to support analysis of and to identify the ill gotten gains of the defendants.
Rhode Island Woman and Son Sentenced for Interstate Extortion Related to Organized CrimeRead the Press Release
Dorothy St. Laurent, 71, of Johnston, R.I., and her son Anthony St. Laurent Jr., 44, of Cranston, R.I., were sentenced today in U.S. District Court in Providence, R.I., for their participation in an interstate extortion scheme, in violation of the Hobbs Act, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division; U.S. Attorney Peter F. Neronha for the District of Rhode Island; and Richard DesLauriers, Special Agent in Charge of the FBI’s Boston Field Office.
U.S. District Court Judge William E. Smith sentenced Anthony St. Laurent Jr., to 78 months in prison, followed by three years of supervised release, to include 500 hours of community service each year during the term of supervised release. Judge Smith sentenced Dorothy St. Laurent to three years of probation, the first six months of which will be served in home confinement. She also was ordered to perform 500 hours of community service per year during the term of supervised release.
Dorothy St. Laurent and Anthony St. Laurent Jr., were charged in a criminal complaint in February 2010 with extorting payments from bookmakers in the Taunton, Mass., area on behalf of Anthony St. Laurent Sr., (Dorothy St. Laurent’s husband and Anthony St. Laurent Jr.,’s father.) According to information presented in court, Anthony St. Laurent Sr., has been identified by law enforcement as a member of New England’s La Cosa Nostra organized crime family. The defendants pleaded guilty in August 2010 to interference with commerce by threats or violence.
According to information presented in court, beginning at least in 1988 and continuing through early February 2009, Dorothy St. Laurent and Anthony St. Laurent Jr., conspired with each other and others to extort “protection” payments from a group of illegal bookmakers operating in and around Taunton.
Dorothy St. Laurent and Anthony St. Laurent Jr., in conversations recorded by the FBI in late 2008 and early 2009, discussed efforts to maintain the extortion scheme, which was generating $4,100 in cash every two weeks at the time. According to the plea agreement, the defendants extorted more than $800,000 and less than $1.5 million during the course of the scheme.
According to information present at court and in court documents, Anthony St. Laurent Sr., functioned as the overall leader of this scheme. Dorothy St. Laurent served as the primary collection agent of the cash payments provided by the bookmakers, while Anthony St. Laurent, Jr.’s role was to both threaten violence and on at least one occasion, to engage in actual violence to ensure continued payment.
The case was prosecuted by Trial Attorney Scott Lawson of the Criminal Division’s Organized Crime and Racketeering Section. Assistant U.S. Attorney William J. Ferland of the District of Rhode Island assisted in the prosecution of this case.
The case was investigated by the FBI, with the assistance of Rhode Island State Police and the Providence Police Department.
Miami-area Clinic Owner Sentenced to 60 Months in Prison for Role in Medicare Fraud Scheme Involving Miami-area Home Health AgenciesRead the Press Release
WASHINGTON –Yudel Cayro, owner and operator of Courtesy Medical Group Inc., a medical clinic in Miami, was sentenced to 60 months in prison for his role in a wide-ranging Medicare fraud scheme involving Miami-area home health agencies, the Departments of Justice and Health and Human Services (HHS) announced today.
U.S. District Judge Adalberto Jordan also ordered Cayro to serve two years of supervised release following his prison term and ordered him to pay $9.8 million in restitution jointly and severally with his co-defendants and co-conspirators in a related case. The restitution is to be paid to the victim in this case, the Centers for Medicare and Medicaid Services (CMS).
According to court documents, Cayro admitted that Courtesy operated in part to provide unnecessary prescriptions, plans of care and medical certifications, among other things, to Miami-area home health agencies in return for kickbacks and bribes. Courtesy provided the fraudulent medical documents so that the home health agencies could bill the Medicare program for expensive home health services and therapy purportedly for insulin dependant diabetic Medicare beneficiaries. In fact, the beneficiaries did not need and in some cases did not receive the services.
According to court documents, approximately 344 prescriptions for these unnecessary services were issued through Courtesy and signed by Cayro’s co-defendant, Dr. Fred Dweck. As a result, Medicare was fraudulently billed approximately $16.6 million for home health services. Medicare paid almost $10 million of the fraudulent claims. Another owner and operator of Courtesy, co-defendant Arturo Fonseca, was sentenced in November 2010, by Judge Jordan to 60 months in prison and two years of supervised release.
Three of Cayro’s co-defendants, Miami-area nurses Armando Sanchez, Marlenys Fernandez and Silvio Ruiz were sentenced last week to prison for their roles in the scheme. Sanchez and Fernandez were each sentenced to 30 months in prison. Ruiz was sentenced to four months in prison. Judge Jordan also ordered Fernandez to pay $331,622, Sanchez to pay $602,585, and Ruiz to pay $79,230 in restitution to CMS, jointly and severally with their co-defendants and co-conspirators in a related case.
On Dec. 7, 2010, another co-defendant, registered nurse Sheillah Rotta, was sentenced by Judge Jordan to two months in prison, followed by two years of supervised release, for her participation in the scheme. Rotta was also ordered to pay $74,164 in restitution to CMS, jointly and severally with her co-defendants and co-conspirators in a related case.
According to court documents, the nurses were engaged in the fraudulent scheme at ABC Home Health and Florida Home Health Care Providers Inc., two Miami home health agencies that were engaged in billing the Medicare program for unnecessary home health services for Medicare beneficiaries. Specifically, the nurses admitted to falsifying patient files to make it appear that these Medicare beneficiaries qualified for two to three times daily skilled nursing visits to purportedly administer diabetic insulin injections. In fact, these Medicare beneficiaries did not need nor qualify for these services.
According to court documents, Sanchez admitted that as a result of his actions, more than $900,000 was falsely billed to the Medicare program; Fernandez admitted to causing approximately $500,000 in fraudulent billings to Medicare; Rotta admitted to causing more than $100,000 in fraudulent billing; and Ruiz admitted to causing approximately $115,000 in fraudulent billing.
Additional co-defendants await sentencing in January 2011, including Dr. Fred Dweck, whose sentencing was continued to Jan. 28, 2011.
Today’s sentence was announced by Assistant Attorney General Lanny A. Breuer of the Criminal Division; U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; John V. Gillies, Special Agent-in-Charge of the FBI’s Miami field office; and Special Agent-in-Charge Christopher Dennis of the HHS Office of Inspector General (HHS-OIG), Office of Investigations Miami office.
The cases were prosecuted by Trial Attorney N. Nathan Dimock of the Criminal Division’s Fraud Section. The cases were investigated by the FBI and HHS-OIG.
The cases were brought as part of the Medicare Fraud Strike Force, supervised by the U.S. Attorney’s Office for the Southern District of Florida and the Criminal Division’s Fraud Section. Since their inception in March 2007, Strike Force operations in seven districts have obtained indictments of more than 825 individuals who collectively have falsely billed the Medicare program for more than $2 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov .
Justice Department Files Fair Housing Lawsuit Against Mississippi Newspaper and Two Individuals for Discrimination Against Families with ChildrenRead the Press Release
WASHINGTON – The Justice Department today filed a lawsuit against a Gulfport, Miss., newspaper and a landlord and her agent for violating the Fair Housing Act by discriminating against families with children.
The lawsuit, filed in the U.S. District Court for the Southern District of Mississippi, charges that Penny Pincher, a weekly want-ad newspaper distributed along Mississippi’s Gulf Coast, engaged in a pattern or practice of violating the Fair Housing Act or denied rights protected by the act by accepting and publishing 10 advertisements for rental housing that stated illegal preferences against families with children. The suit also charges that, by placing one of those ads and by orally stating an illegal preference against renting to families with children, Lynn Cooley and Michael Law violated the Fair Housing Act.
"Housing discrimination against families with children has been illegal for more than 20 years, but it remains a persistent problem," said Thomas E. Perez, Assistant Attorney General for the Justice Department’s Civil Rights Division. "The Justice Department will continue its vigorous enforcement of fair housing laws that protect the rights of families with children."
"The U.S. Attorney’s Office is committed to helping to eradicate all forms of housing discrimination in the Southern District of Mississippi. All citizens and their families should be free to choose where they want to live without fear of discrimination," said Donald R. Burkhalter, U.S. Attorney for the Southern District of Mississippi.
"There is no room for discrimination against families with children in America’s communities," stated John Trasviña, Department of Housing and Urban Development (HUD) Assistant Secretary for Fair Housing and Equal Opportunity. "In Gulfport and around the country, HUD works close with the Department of Justice to take swift action where we believe housing discrimination has occurred."
This lawsuit arose as a result of complaints filed with the HUD by a fair housing group and a woman with three children who was searching for housing for her family. The woman’s search led her to Penny Pincher, in which she read Cooley’s ad offering a house for rent with the proviso, "no children." She contacted the housing group, Gulf Coast Fair Housing Center, which conducted testing at Cooley’s property and monitored the advertisements published by Penny Pincher. After HUD investigated the complaints, it issued three charges of discrimination and the matters were referred to the Justice Department.
The lawsuit seeks a court order prohibiting future discrimination by the defendants, monetary damages for those harmed by the defendants’ actions and a civil penalty.
The federal Fair Housing Act prohibits discrimination in housing on the basis of race, color, religion, sex, familial status, national origin, and disability. More information about the Civil Rights Division and the laws it enforces is available at www.usdoj.gov/crt. Individuals who believe that they have been victims of housing discrimination can call the Housing Discrimination Tip Line at 1-800-896-7743, e-mail the Justice Department at [email protected] or contact HUD at 1-800-669-9777.
The complaint is an allegation of unlawful conduct. The allegations must still be proven in federal court.
Founding Member of Abu Sayyaf Group Sentenced to 23 Years in Prison for 1995 Hostage Taking Involving U.S. and Philippine CitizensRead the Press Release
WASHINGTON -- Madhatta Asagal Haipe, a citizen of the Philippines and founding member of Al-Harakat Al-Islamiyyah, also known as the Abu Sayyaf Group (ASG), was sentenced today to 23 years in prison after earlier pleading guilty to four counts of hostage taking in the 1995 abduction of 16 people, including four U.S. citizens, in the Philippines.
The sentence was announced by David Kris, Assistant Attorney General for National Security; Ronald C. Machen Jr., U.S. Attorney for the District of Columbia; and Daphne Hearn, Interim Special Agent in Charge of the FBI Honolulu Field Office.
Haipe, 48, was extradited to the United States from the Philippines in 2009 to face the charges in this case. He pleaded guilty in July 2010, and was sentenced today by the Honorable Judge Richard W. Roberts in the U.S. District Court for the District of Columbia.
According to the factual proffer in support of the guilty plea, to which Haipe previously agreed in court, Haipe was the general secretary of the ASG, or second-in-command, under the Amir (leader) of the ASG, at the time of the hostage taking. The Amir of the ASG had directed that members of the group engage in kidnappings for ransom in order to raise funds for the group and to raise the public’s awareness of the group’s purpose. The ASG was subsequently designated as a foreign terrorist organization by the U.S. Secretary of State, and remains so designated today.
As admitted by Haipe as part of his guilty plea, on Dec. 27, 1995, several armed members of the ASG kidnapped 16 individuals, including four U.S. citizens, one U.S. permanent resident alien and 11 Philippine citizens, in the rugged area around Trankini Falls, near Lake Sebu, in southern Mindanao, in the Philippines. The hostages, including six children, were forced to march up a mountainside. Some of the adults had rope tied around their hands or neck.
Haipe informed the hostages that they were being kidnapped for ransom, and he individually questioned some of them to determine their nationality and the amount of ransom to be demanded. Later that same day, Haipe decided to release four of the 16 hostages to allow them to collect a ransom totaling at least one million Filipino pesos (equivalent to about $38,000 U.S. dollars, at the time). He threatened that if the released hostages told anyone about the kidnapping, those remaining in captivity would be killed.
Haipe and his group then forced the remaining hostages to continue marching up the mountainside to evade capture by the Philippine authorities. Four days later, on Dec. 31, 1995, Haipe and his group released the remaining hostages after a ransom was paid.
Many of the victims of this crime came to Washington for today’s sentencing.
Haipe was indicted for this crime by a federal grand jury in Washington, D.C., in November 2000. The Department of Justice and the FBI, working with their partners in the Philippines, have vigorously pursued this case for years.
"I applaud the FBI agents, Justice Department prosecutors and authorities in the Philippines who relentlessly pursued this matter on behalf of the victims who were held hostage and threatened with death by this Abu Sayyaf leader. With today’s sentence, Mr. Haipe is finally being held accountable for his actions," said Assistant Attorney General Kris.
"Fifteen years ago in the southern Philippines, Abu Sayyaf’s second-in-command threatened the lives of 16 innocent men, women and children," said U.S. Attorney Machen. "It was incredibly gratifying that so many of those victims were able to stand today in an American courtroom and watch the terrorist who held them hostage be sent to prison for his crimes."
"For 15 years, the Honolulu Division of the FBI worked closely with Philippine authorities to bring this defendant to justice," said FBI Interim Special Agent in Charge Hearn. "This case can be seen as a model of international law enforcement coordination between friendly nations."
The investigation was conducted by the FBI’s Honolulu Field Office, led for the past several years by Special Agent A. Ripley McGuinn, with substantial assistance from the Philippines Department of Justice, the Philippine National Police, the National Bureau of Investigation, the Anti-Money Laundering Council and the Philippine Department of Foreign Affairs. The Criminal Division’s Office of International Affairs and, in particular, Robert Courtney, the U.S. Justice Department’s Attaché to the Philippines, also provided substantial assistance in this case.
The prosecution was handled by Assistant U.S. Attorneys Gregg Maisel and Anthony Asuncion of the U.S. Attorney’s Office for the District of Columbia, as well as Trial Attorney T.J. Reardon, III, of the Counterterrorism Section of the Justice Department’s National Security Division.
Former Grant Administrator and Legal Assistant of American Samoa Non-profit Corporation Indicted for Alleged Mail and Wire Fraud SchemeRead the Press Release
WASHINGTON - A grant administrator and her daughter have been charged with participating in a scheme resulting in the theft of approximately $150,000 in federal grant funds awarded to a non-profit corporation in the Territory of American Samoa, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division.
The 20-count indictment, returned late yesterday by a federal grand jury in the Northern District of California, charges Julie Matau, 48, and her daughter, Andrea Matau, 27, of San Francisco, Calif., each with one count of conspiracy to commit mail and wire fraud, theft of federal grant funds, false statements and falsification of records in a federal investigation; 17 counts of mail and wire fraud; and one count of theft of federal grant funds. Julie Matau is charged separately with one count of falsification of records in a federal investigation.
According to the indictment, U’una’i Legal Services Corporation (ULSC) was a non-profit corporation operating in the Territory of American Samoa from approximately 1998 to 2007. During this time period, ULSC was the only non-profit organization in American Samoa that provided free legal services to victims of domestic violence, dating violence, stalking and sexual abuse. It was also the only provider of legal representation for low income U.S. citizens and legal residents in other civil matters including adoptions, divorces and custody issues. From 2004 to 2007, ULSC relied on various sources of federal grant funding, including funding from the Legal Services Corporation (LSC) and the U.S. Department of Justice, Office of Violence Against Women (OVW).
The indictment alleges that Julie Matau and ULSC’s former acting executive director, David Wagner, submitted grant applications and status reports to obtain federal grant funds from LSC and OVW, and that they diverted approximately $150,000 to themselves and others, including Andrea Matau. The indictment also alleges that Julie Matau, assisted by another person working at her direction, created false time sheets and other documents for employees, including for herself, David Wagner and Andrea Matau, which purported to justify the diversion of funds as "comp time payments."
On March 11, 2010, David Wagner pleaded guilty to stealing $31,292 from the federally-funded organization and is awaiting sentencing. In his guilty plea, Wagner admitted to receiving "salary advances" and other payments to which he was not lawfully entitled, and signing blank checks for Julie Matau.
The conspiracy charge carries a maximum penalty of five years in prison. The mail and wire fraud counts each carry a maximum penalty of 20 years in prison, while the charge of federal grand fund theft carries a maximum penalty of 10 years in prison. Julie Matau faces an additional maximum penalty of 20 years in prison if convicted on the falsification of records charge. Each charged count also carries maximum fines of up to $250,000 or twice the gross gain.
An indictment is merely a charge and defendants are presumed innocent until proven guilty.
The case is being prosecuted by Senior Trial Attorney Mary K. Butler and Trial Attorney Edward J. Loya Jr. of the Criminal Division’s Public Integrity Section. The case is being investigated by special agents of the Legal Services Corporation Office of Inspector General; the Department of Justice, Office of the Inspector General; and the FBI.
Justice Department Files Complaint Against City of Brockton, Massachusetts, and Commonwealth of Massachusetts for Violating the Employment Rights of an Iraq War VeteranRead the Press Release
WASHINGTON – The Justice Department announced today the filing of a complaint against the city of Brockton, Mass., and the Commonwealth of Massachusetts, for violating the rights of an Iraq war veteran, under the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA).
The lawsuit alleges that the defendants violated Brockton Police Sergeant Brian Benvie’s USERRA rights when they failed to fully recognize the retroactive promotion to sergeant he earned after taking a make-up promotional exam upon his return from active duty military service in Iraq in 2007. Benvie’s score on the exam placed him at the top of the promotional list, and he was promoted to sergeant in July 2008. Benvie subsequently learned that another patrolman with a score lower than his had been promoted to sergeant in October 2007. After initially refusing, the city eventually retroactively adjusted Benvie’s promotion to the date he would have been promoted but for his military service. However, the defendants subsequently failed to give full effect to that promotion by denying Benvie the opportunity to take the lieutenants’ promotional exam.
Among other things, the suit seeks to provide Benvie with a makeup exam for the lieutenants’ promotional exam that he was not permitted to take; place Benvie on the appropriate eligibility list based on his score on the lieutenants’ exam; and, should his score merit it, retroactively promote Benvie to lieutenant with all of the rights, benefits and seniority that he would have enjoyed if he had been permitted to take the exam in October 2008 and had achieved the same score.
"No service member should miss out on opportunities for advancement in the civilian workplace because he or she answered a call to duty," said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. "We will use all of the tools at our disposal to protect the rights of those men and women who serve our country and make sacrifices to protect our rights."
U.S. Attorney for the District of Massachusetts Carmen M. Ortiz said, "Our service men and women make the ultimate sacrifice by serving our country. We cannot allow employers to disadvantage them based on their military service or military status."
The Justice and Labor Departments place a high priority on the enforcement of service members’ rights under USERRA. "Our two agencies work closely together to ensure that our service members are treated right when they return from service," said Ray Jefferson, Assistant Secretary of Labor for Veterans’ Employment and Training Service.
This lawsuit arose as a result of a complaint Benvie filed with the U.S. Department of Labor (DOL). After an investigation, DOL determined that Benvie’s complaint had merit and referred the matter to the Justice Department. The case is being handled by the Employment Litigation Section of the Justice Department’s Civil Rights Division and the Civil Division of the U.S. Attorney’s Office for the District of Massachusetts.
Indiana Casino Dealer Found Guilty in Cheating ConspiracyRead the Press Release
WASHINGTON – Mike Waseleski, 46, a former casino card dealer, was found guilty by a federal jury yesterday in San Diego for his role in a cheating scheme by a group of conspirators known as the "Tran Organization" to steal approximately $1.5 million from Resorts East Chicago Casino, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division and U.S. Attorney Laura E. Duffy for the Southern District of California.
Waseleski, of Hammond, Ind., and six additional defendants were charged in a one-count indictment returned Sept. 1, 2009, with one count of conspiracy to commit several offenses against the United States, including conspiracy to transport stolen property in interstate commerce.
According to evidence presented at trial, Waseleski and others executed a "false shuffle" cheating scheme on games at Resorts East Chicago Casino, in East Chicago, Ind. According to evidence presented at trial, members of the criminal organization bribed casino card dealers, including Waseleski, to perform false shuffles during card games, thereby creating "slugs" or groups of unshuffled cards. After tracking the order of cards dealt in a card game, evidence showed that a member of the organization would signal to the card dealer to perform a false shuffle, and members of the group would then bet on the known order of cards when the slug appeared on the table. By doing so, members of the conspiracy allegedly repeatedly won thousands of dollars during card games, including winning several hundred thousand dollars on one occasion.
According to evidence presented at trial, members of the organization used sophisticated mechanisms for tracking the order of cards during games, including hidden transmitter devices and specially created software that would predict the order in which cards would reappear during blackjack games.
At sentencing, scheduled for March 28, 2011, Waseleski faces a maximum penalty of five years in prison, a $250,000 fine and payment of restitution to the victim.
The investigation of the Tran Organization’s alleged casino-cheating conspiracy has led to the filing of three separate indictments. The charges contained in the indictments are merely accusations and defendants are presumed innocent until proven guilty at trial beyond a reasonable doubt.
To date, 41 defendants have pleaded guilty to charges relating to the casino-cheating conspiracy, including: Phuong Quoc Truong, Tai Khiem Tran, Anh Phuong Tran, Phat Ngoc Tran, Martin Lee Aronson, Liem Thanh Lam, George Michael Lee, Tien Duc Vu, Son Hong Johnson, Barry Wellford, John Tran, Willy Tran, Tuan Mong Le, Duc Cong Nguyen, Han Truong Nguyen, Roderick Vang Thor, Sisouvanh Mounlasy, Navin Nith, Renee Cuc Quang, Ui Suk Weller, Phally Ly, Khunsela Prom, Hop Nguyen, Hogan Ho, Darrell Saicocie, Bryan Arce, Qua Le, Outtama Keovongsa, Leap Kong, Thang Viet Huynh, Don Man Duong, Dan Thich, Jimmy Ha, Eric Isbell, Brandon Pete Landry, James Root, Jesus Rodriguez, Jason Cavin, Nedra Fay Landry, Connie Holmes, and Geraldo Montaz. These defendants admitted to targeting, with the aid of co-conspirators, a combined total of approximately 27 casinos in the United States and Canada during the course of the conspiracy, including:
1) Beau Rivage Casino in Biloxi, Miss.;
2) Casino Rama, in Orillia, Ontario, Canada;
3) Foxwoods Resort Casino in Ledyard, Conn.;
4) Gold Strike Casino in Tunica, Miss.;
5) Horseshoe Casino in Bossier City, La.;
6) Horseshoe Casino and Hotel in Tunica, Miss.;
7) Isle of Capri Casino in Westlake, La.;
8) Majestic Star Casino in Gary, Ind.;
9) Mohegan Sun Resort Casino in Uncasville, Conn.;
10) Palace Station Casino in Las Vegas;
11) Resorts East Chicago Hotel and Casino in East Chicago;
12) Sycuan Casino in El Cajon, Calif.
13) Cache Creek Indian Bingo and Casino in Brooks, Calif.;
14) Emerald Queen Casino in Tacoma, Wash.;
15) Imperial Palace Casino in Biloxi;
16) Argosy Casino in Baton Rouge, La.;
17) Trump 29 Casino in Coachella, Calif.;
18) Isle of Capri Casino in Bossier City;
19) Agua Caliente Casino in Rancho Mirage, Calif.;
20) Spa Resort Casino in Palm Springs, Calif.;
21) Pechanga Resort and Casino in Temecula, Calif.;
22) L'Auberge du Lac Casino in Lake Charles, La.;
23) Nooksack River Casino in Deming, Wash.;
24) Barona Valley Ranch Casino and Resort in Lakeside, Calif.;
25) Caesars Indiana Hotel and Casino in Elizabeth, Ind.;
26) Monte Carlo Resort and Casino in Las Vegas; and
27) Harrah’s Casino in Lake Charles, La.
Two other defendants, Ha Thuy Giang and Tammie Huynh, pleaded guilty to tax offenses stemming from the investigation, and Khai Hong Tran admitted to the offenses alleged in a 2007 U.S. indictment when he pleaded guilty to casino-cheating offenses in Canada. Van Tran is scheduled for trial in February 2011.
The case is being investigated by the FBI’s San Diego Field Office; the Internal Revenue Service-Criminal Investigation; the San Diego Sheriff’s Department; and the California Department of Justice’s Bureau of Gambling Control. The investigation has received assistance from federal, state, tribal and foreign authorities, including: the Ontario Provincial Police; the National Indian Gaming Commission; the U.S. Attorney’s Office for the Western District of Washington; FBI Resident Agencies in Gulfport, Miss., Tacoma, Wash., and Toledo, Ohio; the Indiana State Police; the Rumsey Rancheria Tribal Gaming Agency; the Sycuan Gaming Commission; the Barona Gaming Commission; the Mississippi Gaming Commission; and the Washington State Gambling Commission.
The prosecution of the case is led by the Criminal Division’s Organized Crime and Racketeering Section (OCRS). OCRS Trial Attorneys Joseph K. Wheatley and Robert S. Tully are prosecuting the case in San Diego.
Formerly Convicted Maryland Tax Defier Indicted for Filing False Liens Against Prosecutor and for Filing False Claims for Tax RefundsRead the Press Release
WASHINGTON - Andrew Isaac Chance of Clinton, Md., was arrested on a four-count indictment charging him with filing a fraudulent multi-billion dollar lien against a government employee and filing false tax returns seeking $900,000 in false refunds, the Justice Department and the Internal Revenue Service (IRS) announced today. The indictment was returned on Dec. 13, 2010, by a federal grand jury sitting in Greenbelt, Md. No trial date has been set.
According to the indictment, Chance filed a false lien in the amount of $1.313 billion against the property of the Assistant U.S. Attorney who had prosecuted him for filing a false claim for a tax refund in 2007. The indictment also alleges that Chance filed three false income tax returns for estates and trusts for Andrew I. Chance Trust, for tax years 2007, 2008 and 2009. Each of these tax returns claimed a tax refund in the amount of $300,000.
In October 2007, Chance was convicted for filing a tax return for "ANDREW CHANCE TRUST" that claimed a tax refund in the amount of $306,753. On Oct. 15, 2007, Chance was sentenced to 27 months in prison. He was released from prison on June 12, 2009, and is currently on supervised release.
An indictment merely alleges that a crime has been committed, and a defendant is presumed innocent until proven guilty beyond a reasonable doubt.
If convicted, Chance faces a maximum of 25 years in prison and a maximum fine of $1 million dollars.
The case is being investigated by special agents with the IRS and the Treasury Inspector General for Tax Administration and is being prosecuted by Tax Division Trial Attorneys Jen E. Ihlo and Mark S. McDonald.
Five Indicted in Alabama for Roles in Tax Fraud and Identity Theft RingRead the Press Release
MONTGOMERY, Ala. – Five people were indicted by a federal grand jury in the Middle District of Alabama on a variety of charges stemming from an identity theft and tax fraud conspiracy, the Department of Justice and the Internal Revenue Service (IRS) announced today. Alchico Grant, Veronica Dale, Laquanta Grant, Isaac Dailey and Leroy Howard, were charged in a 39-count indictment that was returned on Dec. 14, 2010, and unsealed today.
All five defendants were charged with conspiring to defraud the United States by filing false claims. Dale was also charged with 24 counts of filing false tax returns, two counts of theft of government funds and two counts of aggravated identity theft. Additionally, Alchico Grant was charged with four counts of theft of government funds; Dailey was charged with three counts of theft of government funds; and Howard was charged with two counts of theft of government funds.
According to the indictment, the defendants were involved in a conspiracy which spanned almost two years and involved using stolen identities to file tax returns claiming millions of dollars in fraudulent refunds. The indictment alleges that Dale filed false tax returns using others’ names and Social Security numbers and deposited the fraudulent refunds into bank accounts that she and her co-conspirators controlled. Dale, Alchico Grant and Laquanta Grant recruited people to set up bank accounts to be used to deposit the tax refunds. Howard and Dailey were two of those who agreed to have their bank accounts used for receiving the fraudulently-obtained refunds. In addition, Alchico Grant attempted to persuade several witnesses to give false information to law enforcement about the scheme. In all, the conspirators defrauded the United States of more than $2 million over the course of the conspiracy.
An indictment merely alleges that crimes have been committed, and the defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted, Dale faces a maximum of 154 years in prison, Alchico Grant faces a maximum of 50 years in prison, Dailey faces a maximum of 40 years in prison, Howard faces a maximum of 30 years in prison and Laquanta Grant faces a maximum of 10 years in prison.
IRS-Criminal Investigation agents investigated this case, and Justice Department Tax Division trial attorneys Jason Poole and Michael Boteler are prosecuting the case.
Detroit-area Doctor Sentenced to 36 Months in Prison for Medicare Fraud SchemeRead the Press Release
WASHINTON – Dr. Alan Silber was sentenced yesterday in Detroit to 36 months in prison for participating in a scheme to defraud the Medicare program, announced the Departments of Justice and Health and Human Services (HHS).
U.S. District Court Chief Judge Victoria A. Roberts ordered Silber of West Bloomfield, Mich., to pay approximately $649,000 in restitution, jointly and severally with co-defendants. Silber was also sentenced to 3years of supervised release to follow his prison term.
Silber, 48, was convicted by a federal jury in the Eastern District of Michigan on April 2, 2010, after a week-long trial, of six counts of heath care fraud. Between approximately November 2006 and March 2007, Silber and others caused nearly $1 million in false and fraudulent claims to be submitted to the Medicare program for services supposedly provided by Silber at RDM Centers Inc., a purported infusion clinic. Medicare actually paid more than $649,000 of those claims.
Evidence presented during Silber’s trial established that beginning in approximately November 2006 and continuing until March 2007, Silber routinely prescribed for patients at RDM medications that were medically unnecessary, and in many cases, never provided. In fact, the clinic existed for the purpose of causing fictitious claims for injection and infusion therapy services to be billed to Medicare. Silber was the only doctor who worked at RDM, and the owners of the clinic asked him to prescribe particular drugs to patients because they believed that Medicare would reimburse the medications at a high rate. Evidence at trial showed that Silber agreed to prescribe the medications even though he knew the patients did not need them.
According to court documents and evidence presented at trial, Medicare beneficiaries were not referred to RDM by their primary care physicians or for any legitimate medical purpose, but were recruited to come to the clinics in exchange for the payment of cash kickbacks. Trial evidence showed that in exchange for the cash kickbacks, the Medicare beneficiaries visited the clinic and signed documents indicating that they had received the services billed to Medicare.
All seven defendants charged in connection with RDM have pleaded guilty or have been convicted at trial for their roles in the fraud scheme.
Today’s sentencing was announced by Assistant Attorney General Lanny A. Breuer of the Criminal Division; U.S. Attorney for the Eastern District of Michigan Barbara L. McQuade; Special Agent in Charge Andrew G. Arena of the FBI’s Detroit Field Office; and Special Agent in Charge Lamont Pugh III of the HHS Office of Inspector General’s (OIG) Chicago Regional Office.
This case was prosecuted by Trial Attorney Benjamin D. Singer and Assistant Chief John Neal of the Criminal Division’s Fraud Section, and by Special Assistant U.S. Attorney Thomas Beimers from the Eastern District of Michigan. The FBI and HHS-OIG conducted the investigation. 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 Eastern District of Michigan.
Since their inception in March 2007, Medicare Fraud Strike Force operations in seven districts have obtained indictments of more than 825 individuals who collectively have falsely billed the Medicare program for more than $2 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov .
Attorney General Holder and Secretary Sebelius Team up at Health Care Fraud Prevention Summit in BostonRead the Press Release
WASHINGTON – As part of the Obama Administration’s ongoing efforts to prevent and fight fraud in our nation’s healthcare system, Attorney General Eric Holder and U.S. Department of Health and Human Services Secretary Kathleen Sebelius visited Boston today, where they participated in the fourth Regional Health Care Fraud Prevention Summit. The summit brings together a wide array of federal, state and local partners, beneficiaries, providers and other interested parties to discuss innovative ways to eliminate fraud within the U.S. health care system.
In the District of Massachusetts, the Department of Justice has recovered more than $4 billion in civil and criminal health care fraud settlements over the past two years, including the $2.3 billion settlement with Pfizer Inc. in September 2009 – the largest health care fraud settlement in history.
"Here in Boston and in communities across the country, health care fraud schemes are being aggressively and permanently shut down. The District of Massachusetts, with U.S. Attorney Carmen Ortiz at its helm, has recovered more than $4 billion in civil and criminal health care fraud settlements over the past two years," said Attorney General Eric Holder. "These actions are in large part because of the great work being led by Health Care Fraud Prevention and Enforcement Action Team (HEAT). Through this initiative, we are working in partnership with government, law enforcement and industry leaders to protect taxpayer dollars, control health care costs, and ensure the strength and integrity of our most essential health care programs. Simply put, we have taken our fight against health case fraud to a new level, and I am committed to continued collaboration, vigilance and progress."
"This has been a remarkable year for cracking down on health care fraud – and our success has been built on initiatives like these combining the experience and insight of our law enforcement teams with new resources and cutting-edge technology," said Secretary Sebelius. "Thanks to the new tools and resources provided under the Affordable Care Act, we are more effective at going after the fraudsters that are stealing taxpayer dollars."
Joining Attorney General Holder and Secretary Sebelius at the University of Massachusetts-Boston, were Assistant Attorney General Tony West of the Civil Division and U.S. Attorney Carmen Ortiz of the District of Massachusetts. The summit also featured four educational panels aimed at identifying best practices for providers, law enforcement and beneficiaries in preventing health care fraud.
The recently enacted Affordable Care Act provides additional tools and resources to fight fraud in the health care system by providing an additional $350 million over the next 10 years through the Health Care Fraud and Abuse Control Account. The Act toughens sentencing for criminal activity, enhances screenings and enrollment requirements, encourages increased sharing of data across government, expands overpayment recovery efforts, and provides greater oversight of private insurance abuses. For information on the 2009 Health Care Fraud and Abuse Control Program Report, please visit: www.justice.gov/dag/pubdoc/hcfacreport2009.pdf.
Investments in fraud detection and enforcement pay for themselves many times over, and the Administration’s tough stance against fraud is already yielding results. In FY 2009, anti-fraud efforts put $2.51 billion back in the Medicare Trust Fund resulting from civil recoveries, fines in criminal matters and administrative recoveries. This was a $569 million, or 29 percent, increase over FY 2008. In FY 2009, more than $441 million in federal Medicaid money was returned to the U.S. Treasury, a 28 percent increase from FY 2008. Most recently, in FY 2010, the Department of Justice obtained settlements and judgments of more than $2.5 billion in False Claims Act matters alleging health care fraud. This is highest amount ever obtained in a single year, up from $1.68 billion in FY 2009.
The summits are part of the overall joint health care fraud fighting effort undertaken jointly by the Department of Justice and the Department of Health and Human Services through HEAT. As one part of HEAT’s efforts, Medicare Fraud Strike Force operations have expanded from South Florida and Los Angeles to a total of seven health care fraud hot spots including Houston; Detroit.; Brooklyn, N.Y.; Baton Rouge, La.; and Tampa, Fla. The Strike Force is a partnership between the Criminal Division’s Fraud Section, U.S. Attorneys’ Offices, HHS’ Office of Inspector General, FBI and other federal, state and local law enforcement partners. Since their inception in March 2007, Medicare Fraud Strike Force operations have obtained indictments of more than 850 individuals who collectively have falsely billed the Medicare program for more than $2.1 billion.
On June 8, 2010, President Obama announced this nationwide series of regional fraud prevention summits as part of a multi-faceted effort to crack down on health care fraud. The Boston summit was the fourth in a series, with additional summits to follow in the coming months in Detroit, Boston, Philadelphia and Las Vegas. Previous summits were held in Brooklyn (Nov. 5, 2010), Miami (July 16, 2010) and Los Angeles (Aug. 26, 2010).
Pharmaceutical Companies to Pay $214.5 Million to Resolve Allegations of Off-label Promotion of ZonegranRead the Press Release
WASHINGTON – Irish pharmaceutical manufacturer Elan Corporation PLC and its U.S. subsidiary Elan Pharmaceuticals Inc. (EPI) have agreed to pay more than $203 million to resolve criminal and civil liability arising from the illegal promotion of the epilepsy drug Zonegran, the Justice Department announced today. In a separate civil settlement, Japanese drug marketer Eisai Inc., which purchased the drug from Elan, will pay $11 million to resolve civil liability for off-label marketing of Zonegran.
According to the agreement, Elan has agreed to plead guilty to an information charging it with misdemeanor misbranding of Zonegran, in violation of the Food, Drug and Cosmetic Act. Zonegran was approved by the Food and Drug Administration (FDA) as an anti-epileptic drug, for the treatment of partial epileptic seizures in adults over the age of 16, and was not approved for any other uses. Elan promoted the sale of Zonegran for a wide variety of improper off-label uses including mood stabilization for mania and bipolar disorder, migraine headaches, chronic daily headaches, eating disorders, obesity/weight loss and seizures in children under the age of 16. Elan’s off-label marketing efforts targeted non-epilepsy prescribers and the company paid illegal kickbacks to physicians in an effort to persuade them to prescribe Zonegran for these off-label uses. Under the terms of the plea agreement, Elan has agreed to pay a criminal fine of $97,050,266 and plead to a misdemeanor violation of the Food Drug and Cosmetic Act. EPI will also forfeit $3.6 million in assets.
In addition, Elan has agreed to pay $102,890,517 to resolve civil allegations under the False Claims Act and related state statutes that the company illegally promoted Zonegran and caused false claims to be submitted to government health care programs for a variety of uses that were not medically accepted indications and therefore not covered by those programs. The federal share of the civil settlement is $59,491,477, and the state Medicaid share of the civil settlement is $43,399,040.
The civil settlement resolves a whistleblower lawsuit filed by Dr. Lee Chartock, a Massachusetts physician, under the qui tam or whistleblower provisions of the False Claims Act that is pending in the District of Massachusetts: United States ex rel. Chartock, et al. v. Elan Corporation, PLC, et al., Civil Action No. 04-11594-RWZ. The qui tam provisions allow private citizens with knowledge of fraud to bring civil actions on behalf of the United States and share in any recovery.
As part of today’s resolution with Elan, Dr. Chartock will receive payments totaling more than $10 million from the federal share of the civil recovery. The civil settlement with Eisai also resolves allegations in the Chartock action. Dr. Chartock will receive payments totaling more than $1 million from the federal share of the Eisai civil recovery.
Also as part of the settlement, Elan has agreed to enter into a corporate integrity agreement with the Office of Inspector General of the Department of Health and Human Services (OIG-HHS). That agreement requires Elan to institute procedures and reviews designed to avoid and promptly detect problematic conduct in the future. It also requires Elan to submit regular reports to OIG-HHS.
Under the settlement with Eisai, that company will pay $11 million to resolve civil allegations under the False Claims Act and related state statutes that the company illegally promoted Zonegran and caused false claims to be submitted to government health care programs for uses that were not medically accepted indications and therefore not covered by those programs. The federal share of the civil settlement is $6,341,751 and the state Medicaid share of the civil settlement is $4,658,249. Eisai purchased the drug and its sales force from Elan in April 2004. While Eisai retrained the sales force and took some steps to stop illegal marketing of the drug, some off-label marketing continued and Eisai benefitted from the previous off-label marketing by Elan.
"Off-label promotion of pharmaceutical products undermines the FDA’s important role in protecting the American public by determining whether a drug is safe and effective for a particular use before it is marketed," said Tony West, Assistant Attorney General for the Civil Division. "Such illegal conduct by pharmaceutical companies also costs the government billions of dollars, and these civil settlements and the criminal plea agreement by Elan demonstrate that such conduct will not be tolerated."
"This global resolution reflects the government’s continued commitment to combating pharmaceutical fraud in all its forms, especially where it affects the safe use of potent drugs being prescribed to children. We will continue to aggressively investigate and prosecute companies who intentionally put patient safety at risk in order to turn a profit," said U.S. Attorney Carmen M. Ortiz.
"Our priority is to protect taxpayer-funded government health care programs and beneficiaries," said Daniel R. Levinson, Inspector General of the Department of Health and Human Services. "If Elan – or any of its subsidiaries – intends in the future to actively promote drugs reimbursed by Federal health care programs, the company has agreed to accept even stricter amendments to the formal compliance program signed with OIG today."
"Today’s announcement signals the government’s commitment to investigate and prosecute companies that violate the law and choose to put their profits ahead of the public health" said Deputy Special Agent-in-Charge Kathleen Martin-Weis of FDA’s Office of Criminal Investigations. "The FDA will continue to pursue criminal resolutions when pharmaceutical companies undermine the drug approval process by promoting drugs for uses not approved by the FDA as safe and effective."
This settlement is part of the government’s emphasis on combating health care fraud. One of the most powerful tools in that effort is the False Claims Act, which the Justice Department has used to recover more than $5 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 have topped $6 billion.
The criminal case is being prosecuted by the U.S. Attorney’s Office for the District of Massachusetts and the Justice Department’s Office of Consumer Litigation. The civil settlements were reached by the U.S. Attorney’s Office and the Commercial Litigation Branch of the Justice Department’s Civil Division. The corporate integrity agreement was negotiated by the OIG-HHS. Assistance was provided by the National Association of Medicaid Fraud Control Units and the offices of various state attorneys general.
Justice Department Sues to Bar Florida Man from Promoting Alleged Tax Fraud SchemesRead the Press Release
WASHINGTON – The United States has sued an Orlando, Fla., man seeking to bar him from promoting two alleged tax-fraud schemes, the Justice Department announced today.
According to the government complaint in the civil injunction case in U.S. District Court for the Middle District of Florida, David Miner promotes a "decoder" scheme through a website. The government alleges that Miner falsely claims to be able to "decode" and "fix" Internal Revenue Service (IRS) records of his customers’ tax accounts so as to block the IRS from collecting the customers’ taxes. The complaint states that Miner charges each customer $1,800 for this purported service and claims to have helped more than 2,000 customers stop paying taxes.
The lawsuit also alleges that Miner promotes a "pure trust" abusive tax scheme at another website. According to the complaint, Miner charges customers $2,000 to establish "pure trusts" to evade paying federal income taxes, conceal their assets, and interfere with IRS collection efforts. The government alleges that Miner falsely advises his customers that assets purportedly contributed to the trusts may not be seized by personal creditors, including the IRS.
In the past decade, the Justice Department’s Tax Division has obtained injunctions to stop the promotion of tax-fraud schemes and the preparation of fraudulent returns. Information about these cases is available on the Justice Department website.
Complaint and Request for Injunctive Relief (PDF)
Justice Department Reaches Agreement with Philadelphia School District to Resolve Harassment AllegationsRead the Press Release
WASHINGTON – The Justice Department today announced a settlement agreement with the School District of Philadelphia and the School Reform Commission to resolve an investigation into a complaint of race, color and/or national origin-based harassment of Asian students at South Philadelphia High School, and allegations that the school district was deliberately indifferent to the severe and pervasive harassment. The Pennsylvania Human Relations Commission (PHRC) announced a separate agreement with the School District of Philadelphia and the School Reform Commission.
The complaint filed in U.S. District Court for the Eastern District of Pennsylvania, made by the Asian-American Legal Defense and Education Fund (AALDEF), alleged persistent harassment, including an incident in December 2009, in which approximately 30 Asian students were attacked and approximately 13 were sent to the emergency room. Under Title IV of the Civil Rights Act of 1964 and the Equal Protection Clause of the Fourteenth Amendment to the Constitution, school districts are required to protect students from harassment based on race, color, sex, national origin or religion.
With the cooperation of the district, AALDEF, numerous community advocacy groups, students, and numerous witnesses, the department conducted an extensive investigation of the school district’s policies and practices with regard to student-on-student harassment. The settlement agreement will ensure that the district: retains an expert consultant in the area of harassment and discrimination based on race, color and/or national origin to review the district’s policies and procedures concerning harassment; develops and implements a comprehensive plan for preventing and addressing student-on-student harassment at the high school; conducts training of faculty, staff and students on discrimination and harassment based on race, color and/or national origin and to increase multi-cultural awareness; maintains records of investigations and responses to allegations of harassment; and provides annual compliance reports to the department and the PHRC as well as makes harassment data publicly available.
"Schools have an obligation to ensure a safe learning environment for everyone. We will continue to use all of the tools in our law enforcement arsenal to ensure that all students can go to school without fearing harassment," said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. "I applaud the proactive steps taken by the school district to address this matter, as well as the courageous actions of students, parents and community leaders who came forward to call attention to the pervasive harassment."
Zane David Memeger, U.S. Attorney for the Eastern District of Pennsylvania, added that, "All children in the school district are the big winners today." Memeger said, "We hope that the investigation and our settlement agreement represent the start of a corrective action plan that eventually will eliminate student-on-student harassment in all Philadelphia public schools, not just South Philadelphia High School."
The enforcement of Title IV is a top priority of the Justice Department’s Civil Rights Division. Additional information about the Justice Department’s Civil Rights Division is available on its website at www.justice.gov/crt. Additional information about the U.S. Attorney’s Office is available on its website at www.justice.gov/usao/pae.
Attorney General Holder Hosts Inaugural Meeting of Tribal Nations Leadership CouncilRead the Press Release
WASHINGTON – Attorney General Eric Holder today convened the inaugural meeting of the Justice Department’s Tribal Nations Leadership Council (TNLC), a group of tribal leaders from around the country who will advise him on issues critical to tribal communities. The TNLC marks the first time a council composed of tribal leaders selected by tribal governments will advise a cabinet member on an ongoing basis.
TNLC members include one tribal leader from each of the 12 regions of the Bureau of Indian Affairs, chosen by the tribes of that region, and two members from the Office of Justice Program’s Tribal Justice Advisory Group. The creation of the TNLC fulfills a pledge made by Attorney General Holder at the department’s Tribal Nations Listening Session in October 2009.
In addition to Attorney General Holder, tribal leaders met with senior leadership from numerous department components.
“The Tribal Nations Leadership Council will play an important role in continuing the critical government to government dialogue between the department and tribal governments on matters including public safety,” said Attorney General Holder. “The creation of the council has been a priority for me since my visit with tribal leaders last year and I believe it is a critical step in our work to improve coordination and collaboration with tribal communities.”
The TNLC is expected to meet bi-annually, and TNLC members will have a term of service of two years. The tribal leaders who comprise the initial council include:
Tribal Nations Leadership Council Members
- Marge Anderson, Chief Executive, Mille Lacs Band of Ojibwe Indians, Minnesota
- John Barrett, Jr., Chairman, Citizen Potawatomi Nation, Oklahoma
- Roman Duran, Lieutenant Governor, Pueblo of Tesuque, New Mexico
- Diane Enos, President, Salt River Pima-Maricopa Indian Community, Arizona
- Lynn Malerba, Chief, The Mohegan Tribe of Indians of Connecticut, Connecticut
- Willie Noseep, Co-Chair, Eastern Shoshone Business Council, Wyoming
- Ben Shelly, Vice President and President-Elect, Navajo Nation, Arizona
- Robert Smith, Chairman, Pala Band of Luiseno Mission Indians, California
- Ron Sparkman, Chairman, Shawnee Tribe, Oklahoma
- John F. Stensgar, Chairman of the Natural Resources Committee and Colville Business Council, Confederated Tribes of the Colville Reservation, Washington
- Michael J. Stickman, First Chief, Nulato Village, Alaska
- Roger Trudell, Chairman, Santee Sioux Tribe, Nebraska
Co-Chairs of the Tribal Justice Advisory Group
- Juana Majel Dixon, 1st Vice President-NCAI/TJAG Pacific Region, Pauma Yuima Band of Mission Indians, California
- Hope MacDonald-Lone Tree, Council Delegate/TJAG Navajo Region, Navajo Nation, Arizona
- This meeting marks another step in the Justice Department’s ongoing initiative to increase engagement, coordination and action on public safety in tribal communities. This effort is driven largely by input gathered from the department’s 2009 Tribal Nations Listening Session, the department’s annual tribal consultation on violence against women, and from written comments submitted by tribal governments, groups and organizations to the Justice Department.
The meeting was also a valuable informational tool, a day in advance of the White House Tribal Nations Conference, at which Associate Attorney General Tom Perrelli, Assistant Attorney General for the Environmental and Natural Resources Division Ignacia Moreno, Deputy Assistant Attorney General for the Office of Justice Programs Mary Lou Leary and Office of Tribal Justice Director Tracy Toulou will co-host panels on tribal issues ranging from law enforcement to environmental concerns to education and social services.
To review the Department of Justice’s Tribal Nations Leadership Council Charter, visit: Tribal Nations Leadership Council Charter.
Attorney General Eric Holder Announces Civil Lawsuit Against Nine Defendants for Deepwater Horizon Oil SpillRead the Press Release
WASHINGTON – Attorney General Eric Holder announced today that the Justice Department has filed a civil lawsuit against nine defendants in the matter of the Deepwater Horizon Oil Spill. The lawsuit asks the court for civil penalties under the Clean Water Act and to declare eight of the defendants liable without limitation under the Oil Pollution Act for all removal costs and damages caused by the oil spill, including damages to natural resources.
In the complaint filed today in the U.S. District Court in New Orleans, the United States alleges violations of federal safety and operational regulations which caused or contributed to the oil spill that began on April 20, 2010 when an explosion and fire destroyed the Deepwater Horizon offshore drilling rig in the Gulf of Mexico, approximately 50 miles from the Mississippi River delta. This action will become part of the multi-district litigation pending before Judge Barbier in federal court in New Orleans.
“We intend to prove that these defendants are responsible for government removal costs, economic losses, and environmental damages without limitation,” said Attorney General Holder. “Even though the spill has been contained, the Department’s focus on investigating this disaster and preventing future devastation has not wavered. Both our civil and criminal investigations continue, and our work to ensure that the American taxpayers are not forced to bear the costs of restoring the gulf area and its economy is moving forward.”
The defendants named in the lawsuit are BP Exploration and Production Inc.; Anadarko Exploration & Production LP and Anadarko Petroleum Corporation (known collectively as “Anadarko Defendants”); MOEX Offshore 2007 LLC; Triton Asset Leasing GMBH, Transocean Holdings LLC, Transocean Offshore Deepwater Drilling Inc., and Transocean Deepwater Inc. (known collectively as “Transocean Defendants”); and Transocean’s insurer, QBE Underwriting Ltd./Lloyd’s Syndicate 1036. QBE/Lloyd’s can be held liable only up to the amount of insurance policy coverage under the Oil Pollution Act and is not being sued under the Clean Water Act.
According to the complaint, important safety and operating regulations were violated in the period leading up to the April 20, 2010 Oil Spill, including:
- Failing to take necessary precautions to keep the Macondo Well under control in the period leading up to the April 20th explosion;
- Failing to use the best available and safest drilling technology to monitor the well’s conditions;
- Failing to maintain continuous surveillance; and
- Failing to use and maintain equipment and material that were available and necessary to ensure the safety and protection of personnel, equipment, natural resources, and the environment.
The complaint alleges that these violations caused or contributed to the massive oil spill, and that the defendants are therefore responsible for removal costs and damages without limitation under the Oil Pollution Act.
The complaint also includes claims for civil penalties under the Clean Water Act, which prohibits the unauthorized discharge of oil into the nation’s waters. It alleges that the defendants named in the lawsuit were in violation of the Act throughout the months that oil was gushing into the Gulf of Mexico.
The ongoing civil investigation into the Gulf Spill is being handled by the Assistant Attorneys General Ignacia Moreno and Tony West of the Environment and Natural Resources Division and the Civil Division of the U.S. Department of Justice, the U.S. Environmental Protection Agency, the U.S. Coast Guard, the National Oceanic and Atmospheric Administration, and the Department of the Interior’s Bureau of Ocean Energy Management, Regulation and Enforcement and U.S. Fish and Wildlife Service.
Patrick S. Layng Appointed United States Trustee for Northern Illinois, WisconsinRead the Press Release
WASHINGTON - Patrick S. Layng has been appointed by Attorney General Eric Holder as U.S. Trustee for the Northern District of Illinois and the Eastern and Western Districts of Wisconsin (Region 11), and will assume his duties today, the Executive Office for U.S. Trustees announced. Mr. Layng replaces William T. Neary, the U.S. Trustee for the Northern and Eastern Districts of Texas (Region 6), who has also served as U.S. Trustee for Region 11.
For the past six years, Mr. Layng was a Regional Criminal Coordinator for the U.S. Trustee Program (USTP) with responsibility for prosecuting bankruptcy-related cases as a Special Assistant U.S. Attorney, providing consultation and guidance for law enforcement and USTP personnel on criminal bankruptcy fraud issues, and lecturing extensively on bankruptcy crimes, mortgage fraud, and related topics. Prior to that, he was an Assistant U.S. Attorney in the Northern District of Illinois for more than 14 years. From 1987 to 1989, Mr. Layng was law clerk to the Honorable Stanley J. Roszkowski, U.S. District Court, Northern District of Illinois (retired).
Mr. Layng has tried nearly 40 federal criminal trials and argued 14 cases before the U.S. Court of Appeals for the Seventh Circuit. He received his law degree cum laude from the University of Illinois Urbana-Champaign Law School and his undergraduate degree magna cum laude from the University of Illinois Urbana-Champaign College of Commerce.
The USTP is the component of the Justice Department that protects the integrity of the bankruptcy system by overseeing case administration and litigating to enforce the bankruptcy laws. The USTP has 21 regions and 95 field offices. Region 11 is headquartered in Chicago with additional offices in Milwaukee and Madison, Wisconsin.
Contact:Jane Limprecht, Public Information Officer
Executive Office for U.S. Trustees
(202) 305-7411Owner of Detroit-area Medical Clinic Sentenced to 151 Months in Prison for $23 Million Medicare Fraud SchemeRead the Press Release
WASHINGTON – The owner and the vice president of a Detroit-area physical therapy clinic were sentenced to 151 months and 108 months in prison, respectively, for their leading roles in a $23 million Medicare fraud scheme, the Departments of Justice and Health and Human Services (HHS) announced.
Bernice Brown, 56, the owner of Wayne County Therapeutic Inc. (WCT), and Daniel Smorynski, 63, the vice president of WCT, were sentenced by U.S. District Court Judge Arthur Tarnow in the Eastern District of Michigan. In addition to their prison terms, Brown and Smorynski were sentenced to three years of supervised release and were ordered to pay jointly and severally $6.5 million in restitution.
Brown and Smorynski were convicted by a federal jury earlier this year, after a six-day trial. Brown was convicted of one count of conspiracy to commit health care fraud and nine counts of health care fraud. Smorynski was convicted of one count of conspiracy to commit health care fraud and five counts of health care fraud. Smorynski was acquitted on four counts of health care fraud.
According to evidence presented at trial, WCT, which operated in Livonia, Mich., purported to specialize in physical and occupational therapy. Evidence at trial established that Brown purchased from certain third-party contractors fake physical and occupational therapy files that were created by non-enrolled, and in many cases, non-licensed contractor therapists. Rather than provide therapy, the contractor therapists paid Medicare beneficiaries cash kickbacks to induce the Medicare beneficiaries to provide their Medicare numbers and to sign false documentation to make it appear as if they received therapy. Most, if not all, of the therapy was completely fictitious. Brown and Smorynski billed the services reflected in the fictitious files to Medicare as if WCT therapists had provided the services. Brown instructed her staff to create false documents to add to the fictitious medical files to make it appear that WCT therapists, who were licensed in the state and enrolled with Medicare, had performed the services, when she knew they had not. Smorynski was in charge of billing at WCT and aided in the submission of claims for services he knew WCT did not provide. Between approximately October 2002 and September 2006, Brown and Smorynski submitted approximately $23.2 million in claims to Medicare for physical and occupational therapy services that were never provided. Medicare paid approximately $6.5 million of those claims.
Evidence at trial showed that Brown and Smorynski, in addition to submitting claims for non-existent physical and occupational therapy, caused WCT to submit fraudulent claims for psychotherapy services. In January 2006, when Congress enacted a cap on physical and occupational therapy services to control costs, Brown and Smorynski devised a scheme to avoid the cap by billing for psychotherapy services. Evidence at trial showed that Brown and Smorynski launched a lobbying effort to repeal the cap, which included WCT staff drafting letters and petitions to Congress purportedly on behalf of Medicare patients. Brown and Smorynski then instructed WCT staff to bill Medicare for their lobbying efforts as psychotherapy evaluations and visits. In 2006, WCT billed $493,200 to Medicare for psychotherapy services that were not necessary and not provided, and Medicare paid approximately $121,921 of those claims.
Today’s sentences were announced by Assistant Attorney General Lanny A. Breuer of the Criminal Division; U.S. Attorney for the Eastern District of Michigan Barbara L. McQuade; Special Agent in Charge Andrew G. Arena of the FBI’s Detroit Field Office; and Special Agent in Charge Lamont Pugh III of the HHS Office of Inspector General’s (HHS-OIG) Chicago Regional Office.
These cases were prosecuted by Trial Attorneys Benjamin Singer and Gejaa T. Gobena of the Criminal Division’s Fraud Section. The cases were investigated by the FBI and HHS-OIG, and were brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Michigan.
Since its inception in March 2007, Medicare Fraud Strike Force operations in seven districts have obtained indictments of more than 825 individuals and organizations that collectively have billed the Medicare program for more than $2 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov .
Justice Department Requires Divestiture in Order for L.B. Foster Co. to Proceed with its Acquisition of Portec Rail Products IncRead the Press Release
WASHINGTON — The Department of Justice announced today that it has reached a settlement that will require Pittsburgh-based L.B. Foster Company to divest a West Virginia plant used in the development, manufacture and sale of certain railroad joints to Koppers Inc., in order to proceed with Foster’s acquisition of Portec Rail Products Inc. The department said that the acquisition as originally proposed would combine the two primary U.S. manufacturers of bonded insulated rail joints and two of only three U.S. manufacturers of polyurethane-coated insulated rail joints. Without the divestiture, the department said the acquisition would lead to higher prices, lower quality, less customer service and less innovation.
The Department of Justice’s Antitrust Division filed a civil antitrust lawsuit today in U.S. District Court for the District of Columbia to block the proposed acquisition. At the same time, the department filed a proposed settlement that, if approved by the court, would resolve the competitive concerns alleged in the lawsuit.
Rail joints are steel bars that are bolted onto the ends of two pieces of rail and used to connect the abutting ends of the rails. Insulated rail joints are rail joints that are used to break the electric current flowing through the rail, using a material placed on the steel bars and between the two abutting pieces of rail. Bonded joints use epoxy in addition to bolts to bind the steel bars to the rails. The epoxy makes the joints stronger and, as a result, able to withstand the heaviest loads for extended periods of time. Because of their strength, bonded joints are necessary for the main track lines on the largest U.S. railroads, called Class 1 railroads, which handle most of the heavy freight rail traffic in the United States. Polyurethane-coated insulated rail joints provide electrical insulation through a polyurethane-covered bar that is bolted to the rail. Poly joints are generally used in areas where the weight and traffic is less than on the Class 1 railroads’ main track lines.
The department’s complaint alleges that the proposed acquisition would eliminate the significant competition between L.B. Foster and Portec in the already highly concentrated U.S. markets for bonded insulated rail joints and polyurethane-coated insulated rail joints.
The proposed settlement requires the companies to divest Portec’s Huntington, W.Va., plant, which manufactures all of Portec’s bonded insulated rail joints and polyurethane-coated insulated rail joints. The department has concluded that Koppers will integrate the divestiture assets into its current operations to create a viable business involved in the development, manufacture and sale of bonded insulated rail joints and polyurethane-coated insulated rail joints and that the divestiture to Koppers will remedy the competitive concerns alleged in the lawsuit.
Foster is a Pittsburgh-based company that manufactures and distributes products and services for the rail, construction, energy and utility industries. Foster had total revenues of approximately $382 million in 2009.
Portec is a Pittsburgh-based company that manufactures and distributes products and services for the rail industry and other industries. Portec had total revenues of approximately $92.2 million in 2009.
Koppers is a Pittsburgh-based company that produces carbon compounds and wood products and services for use in a variety of markets, including the rail industry. Koppers had total revenues of approximately $1.12 billion in 2009.
As required by the Tunney Act, the proposed settlement, along with a competitive impact statement, will be published in the Federal Register. Any person may submit written comments concerning the proposed settlement during a 60-day comment period to Maribeth Petrizzi, Chief, Litigation II Section, Antitrust Division, U.S. Department of Justice, 450 Fifth Street, N.W., Suite 8700, Washington, D.C. 20530. At the conclusion of the 60-day comment period, the U.S. District Court for the District of Columbia may approve the proposed settlement upon finding it is in the public interest.
Illinois Woman Pleads Guilty to Illegally Accessing Confidential Student Loan FilesRead the Press Release
WASHINGTON – An Illinois woman pleaded guilty today to illegally accessing numerous confidential student loan files, Assistant Attorney General Lanny A. Breuer of the Criminal Division announced. Charlotte M. Robinson, 46, of Dolton, Ill., pleaded guilty before U.S. Magistrate Judge Susan E. Cox in the Northern District of Illinois to a one-count criminal information charging her with unauthorized computer access. Robinson is scheduled to be sentenced on Feb. 22, 2011.
According to court documents, Robinson worked as a full-time employee in the Federal Student Aid (FSA) Division of the Department of Education, where her responsibilities included reviewing and processing student loan complaints within the FSA Office of the Ombudsman. In pleading guilty, Robinson admitted that she had access to the National Student Loan Database System (NSLDS), which contained confidential federal student loan records maintained by the Department of Education. These student loan records included, among other information, the borrower’s full name, date of birth, Social Security number, type of federal loan, loan balances, place of enrollment and loan servicer. Confidential records maintained in NSLDS are protected by the Privacy Act of 1974, and access by Department of Education employees is strictly limited to official government duties.
Robinson admitted that between April 2006 and May 2009, she logged into NSLDS, which became fully automated in approximately 2006, and repeatedly searched for and viewed the confidential student loan records of several hundred people, including musicians, actors, family members, friends and other individuals. Robinson admitted that she had no official government reason to access and to view these student loan records applications, and that her sole purpose in accessing and viewing these records was idle curiosity.
This case is being prosecuted by Trial Attorney Eric G. Olshan of the Criminal Division’s Public Integrity Section. This case was investigated by the Department of Education Office of Inspector General.
Georgia Man Pleads Guilty to Participating in International Child Pornography Ring Dismantled by International Law Enforcement EffortRead the Press Release
WASHINGTON – A Georgia man pleaded guilty yesterday in Los Angeles to transporting child pornography using a secret Internet bulletin board that allowed approximately three dozen members to trade thousands of images and videos of child pornography depicting young boys in sexually explicit situations, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division; U.S. Attorney André Birotte Jr. and Assistant Director in Charge Steve Martinez of the FBI’s Los Angeles Field Office.
Yesterday’s guilty plea by David Michael Fagerness is the result of an international investigation into the "Lost Boy" online bulletin board. Federal authorities, working in conjunction with a coalition of international law enforcement agencies, shut down the Lost Boy bulletin board approximately two years ago.
As a result of the investigation, 16 named defendants have been charged in the United States for their roles in the ring. To date, five defendants have pleaded guilty for their roles, and an additional two defendants have agreed to plead guilty. An additional eight defendants who are alleged to be Lost Boy members currently face federal charges, including engaging in a child exploitation enterprise, a crime that carries a mandatory minimum sentence of 20 years in prison. Trial for these remaining defendants is currently set for April 26, 2011. The original indictment in the case was returned on Jan. 23, 2009. The first superseding indictment was returned on Sept. 22, 2009, and on Aug. 31, 2010, a grand jury returned a second superseding indictment.
"Through unprecedented cooperation with foreign law enforcement partners, we have brought down a global online group whose principal purpose was to victimize children," said Assistant Attorney General Breuer. "The members of the ‘Lost Boy’ bulletin board used sophisticated vetting procedures to facilitate the sexual abuse of children and enable its users to produce and share child pornography, while also developing a handbook on how to groom potential victims. We are committed to pursuing these perpetrators wherever they are through international investigations and prosecutions like the one we are highlighting today."
"The Lost Boy bulletin board allowed members to access pornographic images of hundreds of boys who were victimized for sexual purposes," said United States Attorney André Birotte Jr. "The investigation by officials here in the United States, working in conjunction with their law enforcement counterparts around the globe, shut down an international child pornography ring and will hopefully bring some justice to the numerous victims. As a result of this investigation, authorities also discovered individuals who abused children, made their own child pornography and shared their disturbing product with others on the Internet."
"The Lost Boy case represents a global subculture that exists for the purpose of trading of child pornography and other tools used to sexually exploit children," said Steven Martinez, Assistant Director in Charge of the FBI in Los Angeles. "The FBI and our partners in Los Angeles and globally will continue to work together to identify these networks and to pursue charges against those who abuse children."
Fagerness, 44, pleaded guilty yesterday in U.S. District Court in Los Angeles to conspiracy to transport child pornography. Fagerness, of the Atlanta area, relocated to the Czech Republic after being convicted of possessing child pornography in Florida state court in 2005. Fagerness faces a 15-year mandatory minimum sentence. Sentencing is scheduled for June 6, 2011.
In addition to Fagerness, four individuals have previously pleaded guilty for their roles in Lost Boy. Andrew Neil Scott, 30, of Flint, Mich., pleaded guilty on Dec. 2, 2010, to one count of participating in a child pornography enterprise and two counts of producing child pornography. According to court documents, Scott admitted to participating in Lost Boy, as well as to molesting two boys and producing child pornography. In his plea agreement, Scott agreed to be sentenced to at least 25 years in prison and to a maximum of 30 years in prison. Anthony Jasso, 46, of Laguna Beach and Redlands, Calif., pleaded guilty in May 2010 to conspiracy to advertise child pornography, a charge that carries a 15-year mandatory minimum sentence. Court documents describe Jasso as belonging to a southern California club called "Boy Lovers," whose members gathered to watch child erotica and to attend events involving children. Justin Lee, 33, of Phoenix, pleaded guilty in September 2010 to transporting child pornography, which carries a mandatory minimum penalty of five years in prison. Woodrow Tracy, 65, of Sun Valley, Calif., pleaded guilty in September 2010.
According to court documents, law enforcement authorities discovered the Lost Boy bulletin board after receiving information from Eurojust, the judicial cooperation arm of the European Union. Eurojust provided U.S. law enforcement with leads obtained from Norwegian and Italian authorities indicating that a North Hollywood, Calif., man was communicating with an Italian national about child pornography and how to engage in child sex tourism in Romania. Acting on the information from Europe, the FBI executed search warrants that led to the discovery of the Lost Boy network. According to court documents, further investigation revealed that Lost Boy had 35 members, 15 of whom were U.S. nationals. Other members of the network were located in countries around the world, including Belgium, Brazil, Canada, France, Germany and New Zealand.
The Lost Boy bulletin board, according to court documents, was dedicated to men who have a sexual interest in young boys and was established to provide a forum to trade child pornography. Lost Boy is alleged to have had a thorough vetting process for new members, most of whom had to post child pornography to join the organization. Once accepted, members had to continue to post child pornography to remain in good standing and not be removed from the board. According to court documents, Lost Boy members advised each other on techniques to evade detection by law enforcement, which included using screen names to mask identities.
Court documents show that the Lost Boy bulletin board had a forum called the "Handbook Project," where members read and contributed to a grooming handbook, which was a guide for adult men on how to find and groom boys into engaging in sex, how to deal with physical aspects of sexual contact, and how to move on to other victims when the current victim grows too old to be attractive.
Through the Lost Boy investigation and related investigations, law enforcement authorities in the United States identified and arrested 15 alleged Lost Boy members, as well as approximately six more men who have been charged with child molestation. The investigation also led to the identification of 27 domestic victims of child abuse, some of whom were portrayed in images posted to the Lost Boy bulletin board.
International law enforcement efforts involving European law enforcement, the Brazilian Federal Police and other agencies have identified child molestation suspects in South America, Europe and New Zealand. Three suspects in Romania, one in France, and another in Brazil have been charged, and offenders have been convicted in Norway and the United Kingdom. Law enforcement efforts have also identified dozens of child victims located in Norway, Romania, Brazil and other nations.
The investigation into the Lost Boy bulletin board is an ongoing effort by the FBI and the U.S. Postal Inspection Service, in conjunction with the Los Angeles-based Sexual Assault Felony Enforcement (SAFE) Team. The High Technology Investigative Unit of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), along with Eurojust, have provided invaluable assistance during the investigation. The SAFE Team in Los Angeles is comprised of the FBI, the U.S. Attorney’s Office, the Los Angeles County District Attorney’s Office, the California Highway Patrol, the U.S. Postal Inspection Service, the California Department of Justice, the Los Angeles County Sheriff’s Department and the Los Angeles Police Department.
The case is being prosecuted by Assistant U.S. Attorneys Joey L. Blanch and Yvonne Garcia, and CEOS Trial Attorney Andrew McCormack.
Fifteen Individuals Extradited from Mexico to the United StatesRead the Press Release
WASHINGTON - Fifteen individuals have been extradited over the past week from Mexico to the United States to stand trial, to be sentenced or to serve sentences, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division. Twelve of the 15 defendants are charged with federal narcotics-related offenses and the remaining three are accused of violent crimes in state-prosecuted cases.
“Extraditions are an important tool we have to ensure that criminals are brought to justice in this country,” said Assistant Attorney General Breuer. “Over the past decade, the Department of Justice has established stronger partnerships with Mexico in many areas of law enforcement, including extraditions to and from each country. With these extraditions of individuals who committed or stand charged with violent and dangerous crimes, we look forward to seeing those partnerships continue to strengthen.”
Three defendants charged in the Northern District of Illinois are arriving today in Chicago. Nine of the defendants departed Mexico and arrived in Houston Saturday morning, while the remaining three arrived in the United States over the course of the past week, beginning on Dec. 8, 2010. The U.S. Marshals Service and the FBI will transport the defendants to the jurisdictions in which they are charged. The extradited defendants are the following:
Oscar Jacobo Rivera Peralta Ricardo Valdez Torres and Alfredo Molina Garcia: Northern District of Illinois; According to court documents, from approximately 2001 until 2006, Peralta, Torres and Garcia were members of a drug trafficking organization responsible for the importation of cocaine, heroin and synthetic heroin into the United States for distribution. The defendants are charged with narcotics trafficking-related offenses.
Rigoberto Yanez: Southern District of California; According to court documents, Yanez was a high-ranking member of the Tijuana Cartel/Arellano Felix Organization (AFO). During the 1990s, Yanez allegedlyacted as a primary representative of the AFO in Mexico City, allegedly handling both the receipt of drug shipments and the transmission of money to drug suppliers, as well as enforcement activities, which included the kidnapping and killing of rival narcotics traffickers. Yanez is charged with narcotics trafficking, money laundering and organized crime-related offenses.
Jose Manuel Escobedo: Eastern District of Texas; In May 2004, Escobedo was found guilty of narcotics offenses, and in February 2005 he was sentenced to serve 10 years in prison. Escobedo escaped from prison in March 2006 and fled to Mexico after serving approximately half of his sentence.
Cantalicia Garza: Southern District of Texas; Garza is accused of participating in a narcotics transportation and distribution organization between 2005 and 2007. Garza is charged with narcotics trafficking-related and money laundering offenses.
Louis Damian Barrientos Barba: Webb County, Texas; According to court documents, on Oct. 21, 2007, Barrientos Barba allegedly shot an individual who was sitting in his truck parked at his home. Barrientos Barba was arrested, but fled to Mexico after being released on bail. Barrientos Barba is charged with aggravated assault.
Jose Maria Cuevas Gonzalez: Clarke County, Va .; According to court documents, on July 9, 2008, Cuevas Gonzalez and an individual had several angry telephone conversations about an old debt Cuevas Gonzalez owed the individual. Later that afternoon, Cuevas Gonzalez allegedly met the individual and one of the individual’s friends. Cuevas Gonzalez allegedly shot and severely injured the two individuals. One of the victims died at the scene. Cuevas Gonzalez is charged with murder and related offenses.
Sergio Humberto Lujan and Marco Antonio Lujan: Western District of Texas; In July 2007, U.S. law enforcement authorities arrested Sergio Humberto and Marco Antonio Lujan after, according to court documents, intercepting telephone calls in which both men, along with other co-conspirators, discussed selling cocaine and the amount of money made in a drug deal conducted in El Paso, Texas. In January 2009, both defendants pleaded guilty to narcotics charges in the Western District of Texas, but fled to Mexico prior to sentencing.
Timoteo Rios: Harris County, Texas; On April 16, 2008, Rios and another man allegedly attacked an individual and grabbed her car keys as she left a store in Houston. According to court documents, as Rios approached the victim’s car, she screamed and attempted to prevent him from taking the car, which had the victim’s baby in the back seat. Rios then allegedly stabbed the victim and fled from the scene. The victim later died at a local hospital. Rios is charged with murder.
Jose Rodolfo Escajeda: Western District of Texas; Between January 2000 and November 2006, Escajeda was allegedly a high-ranking member of a narcotics trafficking organization which imported marijuana and cocaine into the United States from Mexico. According to court documents, this organization also distributed narcotics throughout the United States and transported narcotics proceeds to Mexico. Escajeda and a co-defendant allegedly directed the illegal importation of approximately 188,000 kilograms of marijuana and approximately 25 kilograms of cocaine from Mexico into the United States.
David Plata Segovia: Western District of Texas and Southern District of Alabama; Beginning as early as 1997 and continuing until at least 2008, Segovia was allegedly a leader of a cocaine trafficking organization based out of McAllen, Texas, which transported large shipments of cocaine to other cities in Texas as well as to Alabama, Michigan and Delaware. Segovia is charged with narcotics trafficking-related offenses.
Victor Flores: District of Arizona; Flores, according to court documents, allegedly took part in a drug trafficking organization that imported more than 20 tons of cocaine from Mexico into the United States between February 1995 and April 1999. The organization used a tunnel connecting Naco, Sonora, Mexico, and Naco, Arizona, to import the cocaine, and Flores used his residence in Naco, Arizona, to store approximately one ton of cocaine. Flores is accused of narcotics trafficking conspiracy charges and related weapons offenses.
Bernardo Nava: Southern District of California; During 2006 and 2007, Nava was purportedly a member of a methamphetamine trafficking organization operating in San Diego, California. Nava was responsible for coordinating the transportation of shipments of methamphetamine from Tijuana, Mexico to the United States. Nava is charged with narcotics trafficking conspiracy charges.
Charges are merely allegations and defendants are presumed innocent unless and until proven guilty in a court of law.
The Criminal Division’s Office of International Affairs (OIA) worked with law enforcement colleagues in the United States and Mexico to affect the extraditions. Individuals pending trial will be prosecuted by attorneys from the jurisdictions in which they are charged.
Federal Court Permanently Bars Texas Woman from Preparing Federal Tax Returns for OthersRead the Press Release
WASHINGTON – A federal court has permanently barred Maritza Villanueva of Irving, Texas, from preparing federal income tax returns for others, the Justice Department announced today. The permanent injunction order, to which Villanueva consented, was entered by Judge Jane J. Boyle of the U.S. District Court for the Northern District of Texas.
The government complaint in the case alleged that Villanueva works for Action E-File Services in Irving, and claims false tax credits and deductions for her customers, including false earned income tax credits. According to the complaint, the Internal Revenue Service estimated that Villanueva’s customers underpaid their taxes, or received tax credits to which they were not entitled, in an amount exceeding $3 million.
The court also ordered Villanueva to give government attorneys any lists she possessed identifying individuals for whom she prepared any tax-related documents since Jan. 1, 2007.
Since 2001, the Justice Department’s Tax Division has obtained hundreds of injunctions to stop the promotion of tax fraud schemes and the preparation of fraudulent returns. Information about these cases is available on the Justice Department website.
Dutch Woman and 17 Other Members of FARC Terrorist Organization Indicted on Hostage-taking and Weapons ChargesRead the Press Release
WASHINGTON - Tanja Anamary Nijmeijer, a Dutch national who moved to Colombia and joined the Revolutionary Armed Forces of Colombia (FARC) in 2002, and 17 other members of the FARC designated foreign terrorist organization were indicted by a federal grand jury in Washington, D.C., today on seven counts of terrorism and weapons charges arising out of their participation in the hostage-taking of three American citizens in the Republic of Colombia.
The indictment, returned by a grand jury in U.S. District Court for the District of Columbia, was announced by David Kris, Assistant Attorney General for National Security; Ronald C. Machen Jr., U.S. Attorney for the District of Columbia; and John V. Gillies, Special Agent in Charge, of the FBI’s Miami Division.
The three former hostages – Marc Gonsalves, Keith Stansell and Thomas Howes – were held in the Colombian jungle by members of the FARC for more than five years, until their rescue by Colombian military forces on July 2, 2008.
The indictment charges Nijmeijer, 32, and the other 17 defendants with one count of conspiracy to commit hostage taking, three substantive counts of hostage taking, one count of using and carrying a firearm during a crime of violence and two counts of conspiracy to provide material support to terrorists and a designated foreign terrorist organization.
Sixteen of the defendants are being charged for the first time; two others, charged earlier, face new counts in today’s indictment. If convicted of these charges, each defendant would face a maximum term of up to 60 years of incarceration, the maximum sentence permitted under Colombian law for Colombian nationals extradited to the United States for prosecution. The weapons charge carries a statutory mandatory minimum penalty of 30 years incarceration. Four of the 18 defendants are also charged in count two of the indictment with an eighth count, the premeditated murder of a U.S. national outside the United States, done during the perpetration of, and attempt to perpetrate, a kidnapping, which also carries a maximum sentence of up to 60 years incarceration in this case.
Marc Gonsalves, Keith Stansell, Thomas Howes, Thomas Janis and a Colombian national, Sgt. Luis Alcides Cruz, were conducting counter-drug aerial surveillance in southern Colombia on Feb. 13, 2003, when their Cessna aircraft experienced engine failure and was forced to make an emergency landing on a remote mountainside where a large contingent of FARC guerrillas were gathered. All five occupants of the plane survived the crash, but were immediately taken captive by the FARC guerrillas. The pilot of the plane, Thomas Janis, and the Colombian national, Sgt. Cruz, were both immediately executed by the FARC, and their bodies were left near the crash site. The other three, Mr. Gonsalves, Mr. Stansell and Mr. Howes, were held under barbaric conditions in the jungle for more than five years.
The indictment alleges that the defendants used choke harnesses, chains, padlocks and wires to bind the necks and wrists of the American hostages to prevent their escape, and constructed a large barbed-wire concentration camp to hold dozens of civilian hostages in the jungle for more than a year, including the three Americans.
As Colombian rescue efforts intensified in later years, the indictment alleges that the defendants forced the hostages to move long distances, from camp to camp, including a grueling 40-day march while carrying heavy backpacks through dense jungle to outrun Colombian military forces. The defendants are also charged with forging an agreement to kill the hostages, if necessary, to prevent their escape or rescue.
"We will not tire in our pursuit of all those responsible for this crime. I applaud the many prosecutors, agents and analysts who have worked tirelessly to bring about these charges as we seek justice for the victims of these hostage-takings," said Assistant Attorney General Kris.
"Today's indictment demonstrates our firm resolve to bring to justice every last FARC commander who played any part in this brutal act of terrorism," U.S. Attorney Machen stated.
"The FARC has authorized the use of violence and attacks against American citizens to forward their mission of terrorism. Today's indictment represents the continuing commitment of the FBI to fully investigate and to bring to justice terrorists throughout the world who harm citizens of the United States," said Special Agent in Charge Gillies.
The indictment sheds new light on the international aspect of the FARC’s hostage-taking enterprise, and this crime in particular. For example, it alleges that the hostages were taken to a meeting in 2003 with several senior members of the FARC’s Estado Mayor Central, who told the Americans that their continued detention as U.S. citizens would assist the FARC’s goals by increasing international pressure on the government of Colombia to capitulate to the FARC’s demands. The FARC published communiques articulating their political demands on the Internet, in Spanish and English, to be read in the United States and, in 2003, released a proof of life video articulating their demands to Colombian and American media outlets.
The indictment also alleges that the defendants transported the hostages, at times, outside Colombia and into the Republic of Venezuela, in order to prevent the Colombian police and military from rescuing the hostages.
Four of the defendants in today’s indictment, Carlos Alberto Garcia, also known as "Oscar Montero" and "El Paisa," Juan Carlos Reina Chica, also known as "Farid," Jaime Cortes Mejia, also known as "Davison," and Carlos Arturo Cespedes Tovar, also known as "Uriel,"are charged with murder of a U.S. national outside the United States, for their involvement in the kidnapping when Thomas Janis was shot in the back of the head with an assault rifle by FARC guerrillas. The indictment also alleges that "El Paisa" gave the order to shoot at the disabled plane as it was attempting to land.
Defendant Tanja Nijmeijer gained notoriety in recent years in Colombia, after her personal journal was recovered in a Colombian military raid in 2007, and excerpts of a video interview of her were released to the international press in 2010. On the recently-released video, Nijmeijer describes how she first learned about Colombia’s guerrilla war when she was still a student at the University of Groningen in the Netherlands. She describes how she helped the FARC as an operative in Bogota before eventually joining the group as an armed insurgent in November, 2002. Nijmeijer states on the video that she will be a "guerrilla until we are victorious or until we die, and there’s no turning back."
Today’s charging document represents the fifth indictment issued in the District of Columbia against various FARC members involved in the kidnappings.
In 2005, the Republic of Colombia extradited Juvenal Ovidio Ricardo Palmera Pineda, also known as Simon Trinidad, to the United States in this case. He was subsequently convicted at a jury trial of conspiracy to commit hostage taking, and is now serving a 60-year sentence in federal prison. Chief Judge Royce C. Lamberth, who sentenced defendant Trinidad in 2008, called the crime an act of terrorism that was heinous, barbaric, and "against the law of all civilized nations." The Colombian Supreme Court declined to extradite three other conspirators who were charged with this hostage-taking case in 2007 and 2008, and four other conspirators who were charged in 2003 have been killed or died in Colombian military operations in recent years.
Two of the defendants in today’s indictment - Carlos Alberto Garcia, aka El Paisa, and Jose Ignacio Gonzalez Perdomo, aka Alfredo Arenas - were charged previously in an indictment returned in the District of Columbia in 2003, shortly after the three Americans were taken hostage. Today’s indictment re-files each of those charges and adds a new homicide count against El Paisa. Today’s indictment also adds a new weapons charge and an additional material support charge against both men.
The U.S. government, through the Rewards for Justice Program of the Department of State, is offering a reward of up to $5 million for information leading to the apprehension or conviction of any FARC commanders involved in the hostage taking of Keith Stansell, Thomas Howes and Marc Gonsalves, and the murder of Thomas Janis. The Department of State’s Rewards for Justice Program has been employed worldwide to fight terrorism. Since the program’s inception in 1984, the United States has paid more than $77 million to more than 50 persons who provided credible information that led to the apprehension of individuals or prevented acts of international terrorism.
The newest charges were the result of an investigation led by the FBI’s Miami Field Office and are being prosecuted by Assistant U.S. Attorney Kenneth Kohl of the U.S. Attorney’s Office for the District of Columbia, with the support of David Cora and Brian Murtagh in the Counterterrorism Section of the National Security Division of the Department of Justice. Assistance also was provided by the Directorate of Intelligence and the Anti-Kidnapping Unit of the Colombian National Police, as well as the FBI Office of the Legal Attaché in Bogota, Colombia.
An indictment is merely a formal charge that a defendant has committed a violation of criminal laws. Every defendant is presumed innocent until and unless found guilty.
Justice Department Files Religious Discrimination Lawsuit Against Berkeley School District in IllinoisRead the Press Release
WASHINGTON -- The Justice Department today announced it has filed a lawsuit against Berkeley School District, Berkeley, Ill., alleging that the school district violated Title VII of the Civil Rights Act of 1964 by failing to reasonably accommodate the religious practices of Safoorah Khan, a Muslim teacher at McArthur Middle School.
The government’s complaint, filed in the U.S. District Court for the Northern District of Illinois in Chicago, alleges that Ms. Khan requested an unpaid leave of absence in December 2008 to perform Hajj, a pilgrimage required by her religion. According to the complaint, Berkeley School District denied Ms. Khan’s request because the purpose of her leave was not related to her professional duties nor was it leave for any of the specific purposes set forth in the Professional Negotiations Agreement between the district and the teachers’ union. The United States further alleges that, because Berkeley School District denied her a religious accommodation, the district compelled Ms. Khan to choose between her job and her religious beliefs, and thus forced her discharge.
The lawsuit is based on a charge of discrimination filed by Ms. Khan with the Chicago District Office of the Equal Employment Opportunity Commission (EEOC). After investigating Ms. Khan’s charge, finding reasonable cause to believe that Berkeley School District had discriminated against Ms. Khan, and unsuccessfully attempting to conciliate the matter, the EEOC referred the charge to the Department of Justice. More information about the EEOC is available on its website at www.eeoc.gov.
In the lawsuit, the United States seeks an order requiring Berkeley School District to adopt a policy designed to reasonably accommodate the religious observances, practices and beliefs of employees and prospective employees. In addition, the United States seeks back pay, compensatory damages and reinstatement for Ms. Khan.
"Employees should not have to choose between their religious practice and their livelihood," said Thomas Perez, Assistant Attorney General for the Civil Rights Division. "Federal law prohibits employers from treating employees and applicants less favorably because of their religion, and requires employers to make reasonable accommodations for the religious beliefs and practices of their employees."
"The EEOC is committed to ensuring that individuals are protected from religious discrimination at work," said Jacqueline A. Berrien, Chair of the EEOC. "We are pleased to foster this important collaboration with the Department of Justice to enforce the laws that ensure our workplaces are free of bias."
This is the first lawsuit brought by the Department of Justice as a result of a pilot project designed to ensure vigorous enforcement of Title VII against state and local governmental employers by enhancing cooperation between the EEOC and the Civil Rights Division.
The filing of the lawsuit reflects the Civil Right’s Divisions ongoing commitment to actively enforce federal employment discrimination laws. Additional information about the Civil Rights Division of the Department of Justice is available on its website at www.usdoj.gov/crt.
Florida Man and Two U.K. Nationals Plead Guilty in Relation to Immigration Fraud Scheme Involving Florida Property Development CompanyRead the Press Release
WASHINGTON – A Florida man and two U.K. nationals pleaded guilty Dec.10, 2010, to immigration fraud charges for their roles in a scheme to fraudulently procure visas from the U.S. Embassy in London through a Florida property development company called Royal Development. The guilty pleas were announced today by Assistant Attorney General Lanny A. Breuer of the Criminal Division; U.S. Attorney Robert E. O’Neill of the Middle District of Florida; Eric J. Boswell, Assistant Secretary of State for Diplomatic Security; and Special Agent in Charge Linda J. Osuna of the Internal Revenue Service (IRS) Criminal Investigation Division.
Richard A. Murdoch, 54, of Florida, pleaded guilty to visa fraud and tax evasion in relation to the immigration fraud scheme. Hugh Morgan, 68, a U.K. national residing in Ontario, Canada, and Christopher A. Barrett, 49, a U.K. national residing in Florida, pleaded guilty to conspiracy to commit immigration fraud. Murdoch and Barrett pleaded guilty before U.S. Magistrate Judge David A. Baker. Morgan also pleaded guilty to conspiracy to commit immigration fraud in a separate but related case involving immigration benefit applications submitted to U.S. immigration authorities for a U.K. national named Michael J. Leggett. Leggett previously pleaded guilty to two counts of immigration fraud in relation to Royal Development and his own immigration benefit applications in the Middle District of Florida on Aug. 24, 2007. Morgan’s pleas took place before U.S. Magistrate Judge Gregory J. Kelly.
At sentencing, Murdoch faces a maximum sentence of 10 years in prison for visa fraud and five years for tax evasion; Morgan faces a maximum sentence of five years in prison for each conspiracy charge; and Barrett faces a maximum sentence of five years in prison for conspiracy to commit immigration fraud. Each defendant is also subject to a maximum fine of $250,000 for each charge. Morgan is scheduled to be sentenced on March 9, 2011, and Murdoch and Barrett are scheduled to be sentenced on March 10, 2011.
On April 7, 2010, Murdoch, Morgan and Barrett were indicted for one count of conspiracy to commit immigration fraud and four counts of immigration fraud in relation to Royal Development. The indictment also charged Murdoch with three counts of tax evasion. Murdoch and Barrett were arrested on April 26, 2010, in Florida and Morgan was arrested on the same day in Ontario, Canada, in response to a U.S. government extradition request related to the Nov. 4, 2009, indictment in the separate but related case.
According to court documents, from approximately June 2003 to November 2006, the defendants conspired to commit immigration fraud through Royal Development, which purportedly sold Florida-based home construction companies to foreign nationals. The conspirators represented that the purchase of a company would enable foreign nationals to qualify for and obtain either a treaty investor (E-2) visa or intracompany transferee (L-1A) visa. Along with the sale of the companies, the conspirators generally represented that they would submit the required visa paperwork to U.S. authorities, help the foreign nationals run the company, and help the foreign nationals adjust to life in the United States. According to court documents, the conspirators required a payment of between $65,000 to $165,000 for the purchase of the company and the visa services. During the course of this conspiracy, Royal Development obtained over $2.4 million from the U.K. investors.
According to plea documents, Murdoch admitted that he knowingly presented required applications, affidavits and other documents that contained materially false statements to U.S. immigration authorities. In addition, Murdoch admitted that from approximately June 2003 to April 2006, Murdoch received approximately $536,593 in income from Royal Development for which he should have paid income taxes and that he intentionally failed to file his federal income tax returns for 2003, 2004, and 2005, by the respective due dates, because he was concealing his income from the IRS. The total tax due and owing on this taxable income to the U.S. government is $189,852. Murdoch also admitted that he used the taxable income from Royal Development for personal expenses such as hang gliding, cigars, and the purchase of a 1987 Porsche.
According to plea documents, Morgan and Barrett admitted that they knowingly presented required applications, affidavits and other documents that contained materially false statements to U.S. immigration authorities. In particular, Morgan and Barrett admitted that they knowingly prepared and submitted fraudulent immigration benefit applications for Barrett as well as Barrett’s adult daughter, enabling both Barrett and his daughter to fraudulently procure L-1A visas and come to and work in the United States.
The case was investigated by the Diplomatic Security Service - Criminal Investigations Division in Washington, D.C., and the IRS Criminal Investigation Division in Maitland, Florida. The Fraud Prevention Unit at the U.S. Embassy in London, United Kingdom provided significant assistance. The Diplomatic Security Service - Regional Security Offices in Toronto, Canada, and London, United Kingdom, and the Diplomatic Security Service Miami Field Office provided invaluable support.
In addition, the government of Canada, including Canadian prosecutors and the Toronto Fugitive Squad, provided significant assistance. The Criminal Division’s Office of International Affairs provided valuable assistance.
The case is being prosecuted by Senior Trial Attorney James S. Yoon of the Criminal Division’s Human Rights and Special Prosecutions Section and Assistant U.S. Attorney Karen L. Gable of the U.S. Attorney’s Office for the Middle District of Florida.
Dekalb County, Ga., Agrees to Major Sanitary Sewer System UpgradesRead the Press Release
WASHINGTON – DeKalb County, Ga. has agreed to make major improvements to its sanitary sewer systems in an effort to eliminate unauthorized overflows of untreated sewage, the U.S. Justice Department and the U.S. Environmental Protection Agency (EPA), announced today.
In addition, DeKalb will pay a civil penalty of $453,000, to be split evenly between the United States and the state of Georgia, and implement a supplemental environmental project valued at $600,000 that will provide additional environmental benefits to the local community. The consent decree, lodged in the U.S. District Court for the Northern District of Georgia in Atlanta today, resolves the joint federal and state complaint filed at the same time alleging violations of the Clean Water Act and the Georgia Water Quality Control Act.
“This settlement will mean a healthier, safer environment for communities in DeKalb County,” said Ignacia S. Moreno, Assistant Attorney General for the Environment and Natural Resources Division of the Department of Justice. “Like other aging sanitation systems across the country where we have reached clean water settlements, upgrading this aging infrastructure and conducting community-based cleanups will result in cleaner streams and waterways for families and children.”
“Sewage overflows are a significant problem in the Southeast because of inadequate and aging infrastructure,” said Stan Meiburg, Deputy Regional Administrator of EPA’s Southeastern office. “This agreement demonstrates DeKalb County’s commitment to address long-standing sewage problems. Ultimately, this will benefit the local community and improve water quality in the Upper Ocmulgee and Chattahoochee watersheds."
DeKalb’s sanitary sewer system serves over 500,000 people. The wastewater collection and transmission system which DeKalb owns and operates includes approximately 2,600 miles of sewer lines, 55,000 manholes, and 66 lift stations. This is a sanitary sewer system designed to convey only municipal sewage, not stormwater.
Overflows pose a significant threat to public health because raw sewage can have high concentrations of bacteria from fecal contamination, as well as disease-causing pathogens and viruses. These overflows can occur in backyards, city streets, and directly into streams and rivers.
“This proposed consent decree negotiated with DeKalb County will result in targeted cleanups of DeKalb County streams and major long term improvements to the DeKalb County sanitary sewer systems,” said U.S. Attorney for the Northern District of Georgia Sally Quillian Yates. “The agreement reflects the strong commitment of the Justice Department to enforce the mandate of the Clean Water Act through working with our colleagues in state and local governments.”
The consent decree provides for targeted injunctive relief for priority areas, consisting primarily of the most aged sewer pipes. The major features of the consent decree relating to the sanitary sewer system will require DeKalb to identify and quantify overflows of untreated sewage and their causes; to identify, delineate, assess and rehabilitate all priority areas within 8 ½ years; and improve its management, operation and maintenance programs to prevent future overflows and respond to overflows when they occur. DeKalb has estimated that the injunctive relief and other related improvements may cost approximately $700 million.
As part of the settlement, DeKalb has agreed to conduct a stream cleanup project at an estimated cost of $600,000. The cleanup will focus on removal of trash and debris from segments of the South River, South Fork Peachtree Creek and Snapfinger Creek. DeKalb will encourage the public to join in the stream cleanup project.
The Justice Department and EPA, often joined by the states, are taking an active lead in municipal Clean Water Act enforcement and have already entered into settlements with numerous municipalities including Atlanta; Baltimore; Hamilton County (Cincinnati), Ohio; Jefferson County (Birmingham), and Mobile, Ala.; Knoxville and Nashville, Tenn.; Louisville, Ky.; Miami.; New Orleans; and Sanitation District Number 1 of Northern Kentucky.
The proposed consent decree with DeKalb County is subject to a 30-day public comment period and final court approval. A copy of the consent decree lodged today is available on the Department of Justice website at www.justice.gov/enrd/Consent_Decrees.html .
Restitution Trust Funds Implemented for Foreign Victims of Sex TourismRead the Press Release
WASHINGTON – Restitution trust funds for the benefit of two minor victims of sex tourism in the Philippines were executed and implemented yesterday through the signing of trust documents by Filipino social welfare authorities and a U.S. based trustee, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division and U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida.
The trusts were established as a result of an order of restitution against Donald Mathias of Davie, Fla., in the criminal case against him. Mathias, 64, was sentenced on March 3, 2010, to 20 years in prison for engaging in sex tourism in the Philippines, and also ordered to pay $200,000 inrestitution to his victims.
The trusts serve to ensure that restitution money obtained for the victims of Mathias’ crimes is used for appropriate purposes and for the benefit of the victims. The trustee role is served by the Center for Special Needs Trusts (CSNT), a Clearwater, Fla., based non-governmental organization offering specialized administrative services for unique trust situations. CSNT will oversee and manage disbursements of money from the trusts to ensure that restitution money is properly used. This is believed to be the first case in which restitution trusts have been set up for the benefit of foreign victims of sex tourism. The trusts are being initially funded with proceeds from the sale of property Mathias transferred to the custody of the United States as part of his plea agreement. The proceeds of the sales are currently deposited with the U.S. District Court for the Southern District of Florida, and will now be transferred to an account set up by the trustee, for the benefits of the victims.
Mathias pleaded guilty in U.S. District Court in Ft. Lauderdale, Fla., on Dec. 22, 2009, to four counts of traveling in foreign commerce and engaging in illicit sexual conduct. He was indicted on those charges on Oct. 27, 2009. As part of his plea agreement, Mathias admitted that from 2005 until December 2008, he communicated and arranged with the mother of two minor females to travel to the Philippines, where they were located, and engaged in sexual conduct with the minors. During this time, Mathias and the mother exchanged hundreds of e-mails regarding sexual activity between Mathias and the minors.
Mathias admitted that he traveled to the Philippines in April 2007 and again in December 2007, engaged in sexual conduct with the minors on those trips and recorded those acts with a video camera. Mathias also admitted that he made the minors sign a contract in December 2007, requiring the minors to be his sex slaves. According to court documents, money transfer and email records showed that Mathias sent thousands of dollars to the mother between 2005 and December 2008. Mathias also admitted that he traveled to the Philippines in December 2008 to engage in sexual conduct with the minors again. However, Filipino law enforcement officials detained Mathias and he was not successful in meeting the minors. On Oct. 14, 2009, Mathias was arrested by U.S. law enforcement officers in Miami. The mother of the minors is in custody in the Philippines and is being prosecuted by Filipino authorities.
The trusts were developed through the work of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), U.S. Attorney’s Office for the Southern District of Florida and the Criminal Division’s Office of International Affairs, with assistance from the U.S. Embassy in Manila. These components worked in consultation with a trust attorney to develop suitable trust agreements and identify an appropriate trustee, and also worked with authorities in the Philippines to determine how the trusts would be implemented.
This case was prosecuted by Trial Attorney Anitha Ibrahim of CEOS and Assistant U.S. Attorney Marlene Rodriguez of the Southern District of Florida. This case was investigated by Homeland Security agents in Miami and Manila, Philippines, with assistance from the Philippines Department of Justice.
RAE Systems Agrees to Pay $1.7 Million Criminal Penalty to Resolve Violations of the Foreign Corrupt Practices ActRead the Press Release
WASHINGTON – RAE Systems Inc., a publicly-traded U.S. corporation headquartered in San Jose, Calif., has entered into an agreement with the Department of Justice to pay a $1.7 million penalty for violations of the Foreign Corrupt Practices Act (FCPA), announced Assistant Attorney General Lanny A. Breuer for the Criminal Division and U.S. Attorney Melinda Haag for the Northern District of California.
According to information contained in the non-prosecution agreement, RAE Systems developed and manufactured rapidly deployable, multi-sensor chemical and radiation detection monitors and networks. From 2005 to 2008, the company had significant operations in the People’s Republic of China (PRC), and sold its products and services primarily through two subsidiaries organized as joint ventures with local Chinese entities: RAE-KLH (Beijing) Co. Limited (RAE-KLH) and RAE Coal Mine Safety Instruments (Fushun) Co. Ltd. (RAE Fushun). A significant number of RAE-KLH’s and RAE Fushun’s customers were PRC government departments and bureaus, and large state-owned agencies and instrumentalities, including regional fire departments, emergency response departments and entities under the supervision of the provincial environmental agency.
As described in the agreement, RAE Systems accepted responsibility for violating the internal controls and books and records provisions of the FCPA arising from and related to improper benefits corruptly paid by employees of RAE-KLH and RAE Fushun to foreign officials in the PRC. As a result of due diligence conducted by RAE Systems before acquiring the majority of the joint venture that became known as RAE-KLH, RAE Systems was aware of improper commissions, kickbacks and “under table greasing to get deals” by employees. Yet, according to information contained in the agreement, the company chose to implement internal controls only “halfway” so as not to “choke the sales engine and cause a distraction for the sales guys.” As a result, improper payments continued at RAE-KLH. In acquiring the majority of RAE Fushun, RAE Systems did not conduct any pre-acquisition corruption due diligence in spite of a number of red flags. It was later confirmed that corrupt benefits were also being provided by RAE Fushun. In both instances, RAE Systems learned of corrupt practices at RAE-KLH and RAE Fushun and knowingly failed to implement effective systems of internal controls and failed to properly classify the improper payments in its books and records.
According to the agreement, RAE Systems voluntarily disclosed this conduct to the department, conducted a thorough and credible internal investigation, and undertook extensive remediation. In reaching this agreement, the department applied the Principles of Federal Prosecution of Business Organizations, including consideration of the corporation’s timely and voluntary disclosure of wrongdoing, its willingness to cooperate in the investigation of its agents and the corporation’s remedial actions.
As outlined in the agreement, RAE Systems agreed to fully cooperate with investigations by law enforcement authorities of the company’s corrupt payments, to adhere to a set of enhanced corporate compliance and reporting obligations, and to submit periodic reports to the department regarding RAE Systems’ compliance with its obligations under the agreement.
FCPA enforcement action documents can be found at www.justice.gov/criminal/fraud/fcpa.
In a related matter, RAE Systems reached a settlement with the U.S. Securities and Exchange Commission (SEC) filed today in which RAE consented to the entry of a permanent injunction against FCPA violations and agreed to pay $1,147,800 in disgorgement and $109,212 in prejudgment interest. RAE also agreed to comply with certain undertakings regarding its FCPA compliance program.
The case is being prosecuted by Deputy Chief Charles E. Duross of the Fraud Section, and Assistant U.S. Attorneys Adam A. Reeves and Thomas E. Stevens of the U.S. Attorney’s Office for the Northern District of California. The department acknowledges and expresses its appreciation for the significant assistance provided by the staff of the SEC during the course of this investigation
Justice Department Reaches Agreement with Virginia to Protect Rights of Military and Overseas VotersRead the Press Release
WASHINGTON – The Justice Department today announced that it has reached an agreement with Virginia officials to help ensure that military service members and U.S. citizens living overseas have an opportunity to participate fully in future federal general elections.
The agreement, which was filed in federal court and concludes extensive litigation that began in November of 2008, provides for training, monitoring, reporting and backup procedures in the commonwealth to ensure that absentee ballots are transmitted to eligible military and overseas voters no later than 45 days before a federal election, the deadline required by amendments to federal law made by the 2009 Military and Overseas Voter Empowerment Act.
Under the agreement, Virginia will begin monitoring local election official progress in preparing to transmit absentee ballots to military and overseas voters prior to the 45-day mailing deadline, and will identify and work to prevent late mailings. Commonwealth officials will also monitor local election official progress in transmitting these ballots, and will report this information to the department. Further, the commonwealth will conduct procedural audits of local election offices that transmitted ballots late in prior general federal elections, to identify the source of their delays and correct it through appropriately-tailored training.
The lawsuit was brought under the Uniformed and Overseas Citizens Absentee Voting Act of 1986 (UOCAVA). UOCAVA requires states to allow uniformed services voters (serving both overseas and within the United States) and overseas citizens to register to vote and to vote absentee for all elections for federal office. A federal court in Richmond, Va., ruled in October 2009 that Virginia’s late mailing of ballots in the 2008 general election violated UOCAVA, and ordered the parties to negotiate an appropriate permanent remedy to that violation. Those negotiations resulted in today’s filing, which still must be approved by the federal district court in Richmond.
"The Justice Department is committed to vigorous enforcement of UOCAVA so that members of the uniformed services, their families, and other citizens living overseas are able to exercise their right to vote and be confident their votes will be counted," said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. "I am pleased that officials in Virginia worked cooperatively with the department at this critical stage to help ensure that the commonwealth’s military and overseas voters can participate fully in future federal elections."
More information about UOCAVA and other federal voting laws is available on the Department of Justice website at www.usdoj.gov/crt/voting/misc/activ_uoc.htm. Complaints may be reported to the Voting Section of the Justice Department’s Civil Rights Division at 1-800-253-3931.
Justice Department Charges Seventh Individual for Allegedly Filing Fraudulent Claims for Oil Spill CompensationRead the Press Release
WASHINGTON – A woman was indicted today in the Eastern District of Louisiana for allegedly filing fraudulent claims for compensation due to the Deepwater Horizon oil spill. Four other individuals were charged this week in Alabama, Michigan and Mississippi for fraud related to oil spill compensation claims, in addition to two defendants previously indicted on Nov. 22 and Nov. 24, 2010, in Texas and North Carolina.
These charges were announced today by Assistant Attorney General Lanny A. Breuer of the Criminal Division; U.S. Attorneys Kenyen Ray Brown of the Southern District of Alabama, Jim Letten of the Eastern District of Louisiana, Barbara L. McQuade of the Eastern District of Michigan, Don Burkhalter of the Southern District of Mississippi, George E.B. Holding of the Eastern District of North Carolina, José Angel Moreno of the Southern District of Texas; FBI Assistant Director for the Criminal Investigative Division Kevin L. Perkins; U.S. Secret Service Assistant Director for Investigations A.T. Smith; and Chief Postal Inspector Guy Cottrell of the U.S. Postal Inspection Service.
"The charges announced today send a strong message that we will not tolerate any fraudulent activity designed to profit from this tragic oil spill," said Assistant Attorney General Breuer. "The Department of Justice and federal law enforcement agencies are placing a high priority on the prompt investigation and prosecution of all forms of fraud related to this disaster."
The indictment filed today charges Cam T. Hang with one count of mail fraud. The indictment alleges that Hang filed a claim with the Gulf Coast Claims Facility (GCCF) for $42,000 for business losses resulting from the oil spill. According to the indictment, Hang falsely stated she was doing business as C.H. Food Mart Inc., a seafood restaurant, and submitted fraudulent information claiming that her business experienced loss of income as a result of the oil spill, when in fact it did not.
Yesterday, in the Southern District of Alabama, two individuals were charged in separate criminal complaints. Travis P. Sigler was charged with wire fraud for allegedly submitting fraudulent pay stubs in support of a $13,000 claim made to the GCCF for lost income due to the oil spill. According to the complaint, the fraudulent pay stubs exaggerated the amount of his income for the purpose of increasing the amount received from his claim. Maria Wright was charged with mail fraud for allegedly filing fraudulent documents in support of her claim to the GCCF for $20,000 in lost income due to the oil spill.
Four other individuals have been charged with crimes related to fraudulent claims of compensation. In the Eastern District of Michigan, Kevin Hall was charged in a criminal complaint unsealed on Dec. 8, 2010, with one count of wire fraud. Hall allegedly falsely claimed to BP that he suffered $9,000 in lost business revenue as a result of the oil spill. On Dec. 7, 2010, an indictment was filed in the Southern District of Mississippi, charging Dennis L. Moore with wire and mail fraud. According to the indictment, Moore allegedly submitted false documents – including a false Mississippi tax identification number, false state tax returns, a false Mississippi Department of Revenue Business Permit, false federal tax returns and false sales receipts – in support of claims totaling $180,000 to the GCCF and to BP for compensation relating to the oil spill.
An indictment filed in the Southern District of Texas on Nov. 22, 2010, charged Sergio Corona with wire fraud. The indictment alleges that the defendant filed a claim with BP for $28,434, asserting that he had lost income because of the oil spill, but submitted false and fraudulent receipts and invoices in support of his claim.
Charlette Dufray Johnson was charged in a superseding indictment filed in the Eastern District of North Carolina on Nov. 24, 2010, with wire fraud and aggravated identity theft in connection with her claim to the GCCF. According to the superseding indictment, Johnson allegedly submitted a claim under the name and identity of her deceased sister, falsely claiming to have worked for and been terminated by a company in New Orleans. The indictment also charged her with false claims to the Federal Emergency Management Agency in connection with her previously filing 12 false claims for disaster assistance, totaling $76,666, relating to Hurricane Katrina, a California wildfire, and Tennessee and Georgia storms.
"The FBI is committed to seeking out and prosecuting individuals who commit fraud to obtain compensation intended for those who suffered losses as a result of the spill," said FBI Assistant Director Perkins. "We will continue to pursue disaster fraud whenever it occurs."
"The U.S. Secret Service is proud to partner with the National Center for Disaster Fraud to pursue criminals seeking to commit fraud related to the Deepwater Horizon oil spill," Secret Service Assistant Director Smith said. "Cooperation and partnerships such as this have allowed us to focus our resources to uncover and prevent fraud more efficiently than ever."
"Protecting the mail, as well as those members of the public who are legitimately entitled to compensation after the oil spill, is a key concern for the Postal Inspection Service," stated Chief Postal Inspector Cottrell. "The Postal Inspection Service is pleased to have played an integral role since Hurricane Katrina in 2005 in investigating cases of disaster fraud and ensuring that disaster assistance goes only to those who need it."
The cases announced today are a result of coordination between the Criminal Division’s Fraud Section, the U.S. Attorneys’ Offices, and the National Center for Disaster Fraud (NCDF). The Criminal Division’s Fraud Section, U.S. Attorney’s Offices, and law enforcement agencies are working in coordination to ensure expeditious handling of oil spill-related fraud cases. The NCDF provides a nationwide process for receiving, screening, de-conflicting, and referring cases of disaster fraud, including fraud stemming from the Deepwater Horizon oil spill.
In response to a significant amount of fraud associated with federal disaster relief programs that went into effect following Hurricanes Katrina, Rita and Wilma, a Joint Command Center was established in Baton Rouge in 2005. The command center, now known as the NCDF, has received and screened more than 41,000 complaints of disaster fraud and referred nearly 26,000 of those to law enforcement for investigation. The NCDF – based on its extensive expertise and established infrastructure – has helped victims of fraud related to Hurricanes Katrina, Rita, Wilma, Ike and Gustav, as well as those affected by severe storms in more than 20 different states, earthquakes, tsunamis and wildfires.
Members of the public can report fraud involving the Deepwater Horizon oil spill through the National Center for Disaster Fraud (NCDF) Disaster Fraud Hotline at 877-NCDF-GCF (623-3423), the Disaster Fraud Fax at 225-334-4707 or the Disaster Fraud e-mail at [email protected]. Individuals can also report criminal activity to the FBI at 1-800-CALL-FBI.
Former CEO of the Morgan Crucible Co. Sentenced to Serve 18 Months in Prison for Role in Conspiracy to Obstruct JusticeRead the Press Release
WASHINGTON – The former CEO of The Morgan Crucible Company plc, a United Kingdom corporation, was sentenced to serve 18 months in prison for his role in a conspiracy to obstruct a federal grand jury investigation into price fixing of carbon brushes and other carbon products sold in the United States and elsewhere, the Department of Justice announced.
Ian P. Norris was sentenced today in U.S. District Court in Philadelphia by Judge Eduardo Robreno. Norris was also sentenced to pay a $25,000 criminal fine. The department said that Norris orchestrated an elaborate conspiracy with his subordinates to obstruct the grand jury’s investigation by creating a false script that employees of both Morgan Crucible and its competitor were to follow when questioned during the investigation. The conspiracy also included the formation of a document destruction task force to collect and destroy or conceal documents from the grand jury, the department said.
"The Antitrust Division uncovered and prosecuted an elaborate scheme to obstruct justice," said Christine Varney, Assistant Attorney General in charge of the Department of Justice’s Antitrust Division. "The defendant, the CEO of a major international, publicly traded company, enlisted and led his subordinates in a sophisticated conspiracy that was designed to undermine and obstruct the Antitrust Division’s grand jury investigation. Today’s sentence sends a clear message that those who subvert the integrity of our justice system will face serious consequences."
Carbon products are used to transfer electrical current in automobiles, trains, public transit vehicles and consumer products and are used in pumps and compressors to contain liquids and gases.
Norris has been incarcerated in the federal detention center in Philadelphia since July 27, 2010, the date on which he was convicted by a federal jury of conspiring to obstruct justice. Norris, a citizen of the United Kingdom, was extradited to the United States in March 2010 on the conspiracy charge.
As a result of the department’s investigation into anticompetitive conduct in the carbon products industry, more than $11 million in criminal fines have been obtained, and four executives and two companies have pleaded guilty or have been convicted. The Morgan Crucible Company plc, based in Windsor, England, pleaded guilty in 2002 to two counts of obstruction of justice and paid the statutory maximum fine of $1 million for those offenses. Additionally, a former subsidiary of the company, Morganite Inc., based in Dunn, N.C., pleaded guilty in 2002 to fixing prices of carbon brushes and other carbon products and paid the then statutory maximum fine of $10 million for that illegal conduct.
Three of Norris’s subordinates previously pleaded guilty to obstruction charges and served jail time. Jacobus Johan Anton Kroef, the former chairman of the industrial and traction division of Morgan Crucible, pleaded guilty in 2003 to witness tampering. Robin D. Emerson, former pricing coordinator at Morganite Electrical Carbon Ltd. of Swansea, U.K., pleaded guilty in 2003 to corruptly persuading another individual to destroy or conceal documents in connection with the investigation. F. Scott Brown, the former global president and a member of the board of directors of Morgan Advanced Materials and Technology Inc. (MAMAT), now headquartered in Greenville, S.C., pleaded guilty in 2003 to aiding and abetting document destruction in connection with the investigation. Morganite Electrical Carbon Ltd. and MAMAT are subsidiaries of Morgan Crucible.
Anyone with information concerning price fixing in the carbon brushes industry should contact the Antitrust Division’s Philadelphia Field Office at 215-597-7405 or visit www.justice.gov/atr/contact/newcase.htm.
Florida Couple Sentenced in Forced Labor Conspiracy to Exploit Filipino Guest WorkersRead the Press Release
WASHINGTON - The Justice Department announced today that Sophia Manuel and Alfonso Baldonado Jr., owners of Quality Staffing Services Corporation, a labor contracting service, were sentenced for conspiring to hold approximately 39 Filipino nationals in forced service to work in country clubs and hotels in Southeast Florida. Manuel also was sentenced for making false statements on an application she filed with the U.S. Department of Labor to obtain foreign labor certifications and visas under the federal H2B guest worker program. Manuel was sentenced to 78 months in federal prison and Baldonado to 51 months.
Manuel and Baldonado previously pleaded guilty to conspiring to obtain a cheap, compliant and readily available labor pool by making false promises to entice the victims to incur debts to pay up front recruitment fees. Defendants then compelled the victims’ labor and services through threats to have the workers arrested and deported knowing the workers faced serious economic harm and possible incarceration for nonpayment of debts in the Philippines.
"These defendants exploited vulnerable individuals for their own financial gain, depriving the victims of their civil rights," said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. "The Department of Justice will continue to vigorously prosecute cases of forced labor where victims have been robbed of their freedom and dignity."
U.S. Attorney Wifredo Ferrer stated, "Today’s sentencing reminds us that America remains a land of freedom and opportunity for immigrants, not of servitude and fear. Forced labor is illegal and we will enforce the laws that protect our immigrant communities from abuse."
"Human traffickers target vulnerable victims, including minors, who desire a better life and end up being lured into a situation where they are deprived of their basic human rights," said ICE Director John Morton. "These deplorable conditions will not be tolerated in this country and ICE will continue its commitment to rescue victims of this form of modern day slavery and arrest the traffickers that exploit them."
This case was investigated by U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations in Miami, Federal Bureau of Investigation; the U.S. Department of Labor - Office of Inspector General; the FBI; the U.S. Department of State - Bureau of Diplomatic Security; the Florida Department of Law Enforcement; and the Florida Office of the Attorney General.
This case is being prosecuted by trial attorney Susan French of the Human Trafficking Prosecution Unit, Criminal Section of the Civil Rights Division and Assistant United States Attorney Shaniek Maynard.
Attorney General Eric Holder Speaks at National Indian Nations Conference During Week of Justice Department Events with Tribal CountryRead the Press Release
PALM SPRINGS, Calif. – Attorney General Eric Holder served as the keynote speaker at the 12th National Indian Nations Conference in Palm Springs, Calif., during a week of outreach events organized by the Department of Justice that brought together tribal leaders and youth, law enforcement officers, lawyers and judges, policy experts and health and social services providers, and representatives from federal, state, local and tribal governments.
The week commenced with the Justice Department’s Interdepartmental Tribal Justice, Safety and Wellness Session from Monday, Dec. 6 through Wednesday, Dec. 8, 2010, followed by the National Indian Nations Conference sponsored by Department of Justice’s Office for Victims of Crimes (OVC) from Dec. 9 through Dec. 11, 2010.
“With the passage of the Tribal Law and Order Act, we are witnessing tangible progress toward a healthier, brighter future for Native Americans,” said Attorney General Eric Holder. “ I want to reaffirm the Justice Department’s commitment – and my own commitment – to building and sustaining healthy and safe native communities; to renewing our nation’s enduring promise to American Indians and Alaska Natives; to respecting the sovereignty and self-determination of tribal governments; and to ensuring that the progress we have achieved in recent years is not derailed.”
The Justice Department’s Interdepartmental Tribal Justice, Safety and Wellness Session included workshops and plenary sessions that focused on Native American wellness, examining topics such as tribal youth programs; victim’s assistance; suicide prevention; alcohol and substance abuse; community-based partnerships; domestic violence and sexual assault; and data reporting and information sharing. The session also featured a consultation on implementation of the Tribal Law and Order Act with t ribal leaders and top Department of Justice officials. The session was co-sponsored by the Departments of Health and Human Services, Interior, Housing and Urban Development, the Small Business Administration and the Corporation for National and Community Service.
The 12th National Indian Nations Conference, which runs until Saturday, is coordinated by the Tribal Law and Policy Institute under a grant from OVC. The conference is focused on bringing together Native American victims, victim advocates, as well as federal and state agency representatives, to share their knowledge, experiences and ideas for developing programs that serve the unique needs of crime victims in Indian Country.
The roots of this conference stretch back more than two decades: the OVC organized the very first National Indian Nations Conference in 1988.
“In this time of growing demands and limited resources, the fact that a record number of attendees – more than 900 – have gathered for this conference is evidence of your commitment to meeting the challenges we face,” said Attorney General Holder. “It also speaks volumes about the impact and importance of this biennial meeting.”
The Interdepartmental Tribal Justice, Safety and Wellness Session and the 12th National Indian Nations Conference are part of the Justice Department’s ongoing efforts to create better communication and coordination to fight crime and promote justice in tribal communities. More information on the Interdepartmental Tribal Justice, Safety and Wellness Session is available at: www.cvent.com/EVENTS/Info/Summary. More information on the 12th National Indian Nations Conference is available at: www.ovcinc.org/agenda .
Two Engineers Found Guilty of Stealing Goodyear Trade SecretsRead the Press Release
WASHINGTON – A federal jury convicted Clark Alan Roberts, 47, and Sean Edward Howley, 39, both former engineers with Wyko Tire Technology Incorporated, located in Greenback, Tenn., of stealing trade secrets from the Goodyear Tire and Rubber Company, Assistant Attorney General Lanny A. Breuer of the Criminal Division and U.S. Attorney William C. Killian for the Eastern District of Tennessee announced today.
After a one-week trial, the jury found Roberts and Howley guilty of one count of conspiracy to commit trade secret theft, one count of trade secret theft, one count of unlawful photographing of trade secrets, three counts of transmittal of trade secrets, one count of possession of trade secrets, two counts of wire fraud and one count of conspiracy to commit wire fraud.
"Unable to create an effective design on their own, these engineers stole trade secrets from a competitor in order to fulfill a contract," said Assistant Attorney General Breuer. "We will not allow the hard work and resources businesses put into product development to be compromised by individuals who unlawfully obtain protected secrets."
"The ruling in this case will send a message that complicated trade secret violations will be aggressively investigated and prosecuted by U.S. Attorney’s Offices and the Department," said U.S. Attorney Killian.
According to the evidence presented in court, Wyko secured a $1.2 million contract in early 2007 with the Haohua South China Guilin Rubber Company Limited (HHSC), a Chinese tire manufacturing company located in Guilin, Peoples Republic of China, to supply tire building equipment for use in producing radial "off the road" (OTR) tires, which are used on very large earth moving and mining equipment. Wyko was in the business of making tire building equipment for Goodyear and other tire manufacturers. One of the pieces of equipment that Wyko agreed to sell to HHSC was called a swab down device, which is used during the manufacture of a giant OTR tire. However, Wyko had never built a swab down device before and was having difficulty in the spring of 2007 completing their design of the swab down device.
On May 30 and 31, 2007, Roberts and Howley, traveled to a Goodyear tire manufacturing facility located in Topeka, Kan., to service Wyko equipment located in the Goodyear plant with the intention of taking photographs of Goodyear’s swab down device to assist them with completing their design even though they knew Goodyear protected the swab down device as a trade secret. On May 31, 2007, the defendants used a cell phone camera to surreptitiously take seven unauthorized photographs of a Goodyear swab down device, without the knowledge or permission of Goodyear. The defendants then emailed the unauthorized photographs to employees at a Wyko subsidiary located in Dudley, England, who used the trade secret information contained in the photographs to complete a similar piece of tire building equipment for the HHSC contract.
The defendants are scheduled to be sentenced on the 10 felony counts by U.S. District Court Judge Thomas Phillips on April 14, 2011. The defendants face a maximum of 10 years in prison for each trade secret count, 20 years in prison for each wire fraud count and $2.5 million in fines.
The case was prosecuted by Trial Attorney Thomas S. Dougherty of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney D. Gregory Weddle of the U.S. Attorney’s Office for the Eastern District of Tennessee. The case was investigated by the FBI’s Knoxville Division.
Three New Orleans Police Officers Found Guilty in the Post-Katrina Shooting and Burning of Henry GloverRead the Press Release
WASHINGTON- A federal jury in New Orleans convicted three current and former New Orleans Police Department (NOPD) officers, David Warren, Greg McRae and Lt. Travis McCabe, in relation to the post-Katrina shooting death of Henry Glover, and the subsequent burning of Glover’s remains and obstruction of justice.
The jury found former NOPD Officer David Warren guilty of a civil rights violation, resulting in death, for the Sept. 2, 2005, shooting of civilian Henry Glover, as well as use of a firearm during a crime of manslaughter. The jury heard evidence that defendant Warren shot Glover in the back as Glover was running away from him. In a separate charge, the jury found Warren guilty of using a firearm in the commission of a crime of violence. Warren faces a possible life sentence for the civil rights shooting crimes, and up to 15 years imprisonment for the firearms manslaughter.
Evidence presented at trial established that Officer Warren, while stationed on a second floor lookout, shot Henry Glover, who was a floor below him and running away. Glover’s brother and a friend flagged down a passing motorist, "Good Samaritan" William Tanner, who put the wounded Glover in his car to try to get medical attention for him. However, when the group of men drove up to a makeshift police station seeking help for Glover, police officers surrounded the men at gunpoint, handcuffed them, and let Henry Glover die in the back seat of the car. McRae then drove off with Tanner’s car, with Glover’s body inside, and burned both the body and the car with traffic flare.
The jury convicted current Officer McRae, who was one of the officers at the makeshift station, on two counts of civil rights violations. One of the civil rights counts charged that he willfully used fire to destroy a civilian’s property by burning and destroying Tanner’s car, and the other civil rights count charged that he willfully deprived Glover’s family members of their right to seek redress in the courts for his death. The jury also convicted McRae on one count of obstruction of justice and one count of using fire in the commission of a felony. McRae faces a possible sentence of 50 years in prison.
The jury also convicted NOPD Lt. Travis McCabe, who obstructed justice by writing and submitting a false report about the shooting of Henry Glover. McCabe was also convicted for lying to the FBI and committing perjury by lying to a federal grand jury convened to investigate Glover’s death. McCabe faces a maximum sentence of 30 years in prison.
The jury acquitted Lt. Dwayne Scheuermann, who was accused of aiding and abetting the burning of the car, and Lt. Robert Italiano, who was accused of participating in the cover up.
"Instead of upholding their oath to protect and serve the people of New Orleans in the days after Hurricane Katrina, these officers violated the law and the public trust," said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. "And while some officers broke through the thin blue line and told the truth under oath, others were rightly convicted for obstructing justice. Today's verdict brought a measure of justice to the Glover family and to the entire city."
"Today’s verdicts send a powerful message that no one is above the law, and that those who are sworn to protect our citizens are never, under any circumstances, relieved of their sacred responsibilities under our constitution. We will continue to do everything in our power—and use every law and weapon in our arsenal of justice to make certain that our police never abuse power they wield. Today is an important step forward for the courageous Glover family and the people of New Orleans, and an important move toward the city’s healing and rebuilding," said Jim Letten, U.S. Attorney for the Eastern District of Louisiana.
David Welker, FBI Special Agent In Charge for Louisiana, said, "Today’s verdict demonstrates the continued diligence and commitment of the FBI to aggressively and fairly pursue civil rights violations, with the goal of bringing to justice those who abuse the very citizens they are entrusted to protect and serve."
During the course of the month-long trial, jurors heard from 65 witnesses, including all five of the defendants. Jurors deliberated for three days before returning their verdict.
This case was investigated by the New Orleans Field Office of the FBI, and was prosecuted by Trial Attorney Jared Fishman of the Justice Department’s Civil Rights Division, and Assistant U.S. Attorneys Tracey Knight and Michael Magner for the Eastern District of Louisiana.
Three Former Financial Services Executives Indicted for Fraudulent Conduct Affecting Contracts Related to Municipal BondsRead the Press Release
Three former executives of a financial services company were indicted today for their participation in fraud schemes and conspiracies related to bidding for contracts for the investment of municipal bond proceeds and other municipal finance contracts, the Department of Justice announced. One executive was also indicted for witness tampering in connection with the department’s ongoing investigation into anticompetitive and fraudulent conduct in the municipal bond industry.
The six-count indictment was filed today in U.S. District Court in New York City. The indictment charges Peter Ghavami, Gary Heinz and Michael Welty with participating in separate fraud schemes at various time periods from as early as 2001 until 2006. Ghavami, a Belgian national who was residing in Moscow, was originally charged by criminal complaint and was arrested last week at John F. Kennedy International Airport in New York.
"The individuals charged today allegedly participated in complex fraud schemes and conspiracies that subverted competition in the market for municipal finance contracts and deprived municipal bond issuers of the benefits of their investments to the detriment of the public," said Christine Varney, Assistant Attorney General in charge of the Department of Justice’s Antitrust Division. "This type of anticompetitive activity in our financial markets will not be tolerated and the Antitrust Division will continue to prosecute those who engage in this illegal conduct. This includes individuals who purposely seek to obstruct the government’s investigation."
The charged conspiracies and schemes all relate to a type of contract, known as an investment agreement, and other municipal finance contracts provided to public entities, such as state, county and local governments and agencies throughout the United States. Major financial institutions, including banks, investment banks, insurance companies and financial services companies, are among the providers of investment agreements and other related municipal finance contracts. Public entities typically hire a broker to conduct a competitive bidding process among various providers prior to awarding these agreements and contracts. Competitive bidding for these agreements is the subject of regulations issued by the U.S. Department of the Treasury and is related to the tax-exempt status of the bonds.
According to the indictment, the financial services company where Ghavami, Heinz and Welty worked was a wholly-owned subsidiary of a foreign-based financial institution that had its principal place of business in New York City. The financial services company marketed financial products and services to various municipalities, acted as a provider for investment agreements and other municipal finance contracts, and in some instances, acted as a broker for such agreements and contracts.
According to the indictment, Ghavami, Heinz and Welty conspired with employees of various financial institutions to manipulate the bidding process for these agreements and contracts, by discussing with co-conspirators the price or price level their employers intended to bid and determining with their co-conspirators which financial institution would win a particular investment agreement or municipal finance contract.
The indictment also alleges that Ghavami, Heinz and Welty and their co-conspirators falsely certified that the bidding process on rigged deals was competitive and in compliance with U.S. Treasury regulations. This caused the municipal issuers to award investment agreements and other municipal finance contracts to providers that otherwise would not have been awarded the contracts, and in some instances, deprived the Internal Revenue Service and U.S. Treasury of money to which they were entitled.
The indictment further alleges that Ghavami, Heinz and Welty conspired with Beverly Hills, Calif.-based Rubin/Chambers, Dunhill Insurance Services Inc. (CDR) and others in order to obtain from CDR information about the prices and other information related to competing bids and then used that information to determine their employer’s bid. In some cases, they submitted intentionally losing bids for agreements or contracts brokered by CDR to make it appear that their employer and parent company had legitimately competed for those agreements or contracts. They also allegedly agreed to pay and arranged for kickback payments to be made to CDR in the form of fees that were inflated, relative to the services performed, for CDR’s assistance in controlling and manipulating the competitive bidding process in their employer’s favor.
Ghavami, Heinz and Welty are also charged with participating in a conspiracy and fraud schemes in their capacity as brokers and advisors to municipal bond issuers. According to the indictment, in different instances, Ghavami, Heinz and Welty, acting as brokers, accepted various kickbacks on behalf of their employer in exchange for manipulating the bidding process and steering investment agreements and other municipal finance contracts to certain financial institutions and entities. According to the indictment, their conduct caused investment agreements to be awarded at artificially determined price levels and deprived the municipal issuers or the U.S. Treasury of money to which they otherwise would have been entitled.
The indictment also charges Heinz with witness tampering in November 2006, when after learning of the department’s investigation, he is alleged to have told another individual, among other things, to meet with a second individual for the purpose of coordinating their stories about a rigged deal.
"Some criminals may believe that the more complex the financing arrangements are, the easier it will be to avoid detection and financial investigation by the authorities," IRS Criminal Investigation Special Agent in Charge, Charles R. Pine stated. "As the agency responsible for ensuring compliance in the municipal bond industry, we will continue to investigative fraudulent schemes and recommend prosecution of those who seek to illegally benefit at the expense of taxpayers."
"The distinction between the conduct of these defendants and crooks who engage in traditional bid-rigging is a distinction without a difference," said FBI Assistant Director-in-Charge Janice K. Fedarcyk. "Whether the collusive scheme involves contracts for street paving or trash collection or municipal bonds, fixing prices and colluding on bids is anticompetitive, harms the public, and is therefore in the crosshairs of the FBI."
One of the charged fraud conspiracies carries a maximum penalty of five years in prison and a $250,000 fine. The other two fraud conspiracies carry a maximum penalty per count of 20 years in prison and a $1 million fine. The two wire fraud charges also carry a maximum penalty per count of 20 years in prison and a $1 million fine. In addition, Heinz faces a maximum penalty of 20 years in prison and a $250,000 fine for the witness tampering charge. These maximum fines per count may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either amount is greater than the statutory maximum fine.
At a hearing yesterday, U.S. Magistrate Judge Dollinger refused to allow Ghavami to return to Russia and ordered that he be released on bail, pending satisfaction of a $10 million bond, that his travel be limited to the Southern and Eastern Districts of New York, and other conditions.
The charges announced today resulted from an ongoing investigation conducted by the Antitrust Division’s New York Field Office and Chicago Field Office, the FBI and IRS Criminal Investigation. The division is coordinating its investigation with the U.S. Securities and Exchange Commission, the Office of the Comptroller of the Currency and the Federal Reserve Bank of New York. As part of this investigation, three former employees of CDR have pleaded guilty to bid-rigging and fraud conspiracies in relation to the ongoing investigation. Five other individuals have pleaded guilty to charges related to the ongoing investigation. In addition, three former financial services executives were indicted on July 27, 2010, for participating in fraud schemes and conspiracies related to the bidding for investment agreements. In October 2009, CDR, two of its employees and one former employee were charged for participating in bid-rigging and fraud conspiracies and related crimes. The CDR trial is scheduled to begin on Sept. 12, 2011.
Today’s charges are part of efforts underway by President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes. For more information on the task force, visit www.StopFraud.gov.
Anyone with information concerning bid rigging and related offenses in any financial markets should contact the Antitrust Division’s New York Field Office at 212-264-0390 or the FBI at 212-384-5000.
Professional Duck Hunter Charged with Guiding Illegal Waterfowl Hunts in Central IllinoisRead the Press Release
WASHINGTON – A federal grand jury in Springfield, Ill., returned a 23-count felony indictment today charging Jeffrey B. Foiles with conspiracy, wildlife trafficking, and making false writings in connection with the illegal sale of guided waterfowl hunts, the Department of Justice announced today.
The indictment charges Foiles, 53, of Pleasant Hill, Ill., with conspiracy to violate the Lacey Act and the federal false writings statute, 12 substantive violations of the Lacey Act, and ten counts of making false writings in a matter within the jurisdiction of the U.S. Fish and Wildlife Service.
The Lacey Act is a federal law that makes it illegal to knowingly transport or sell wildlife taken in violation of federal law or regulation. The act defines the sale of wildlife to include the sale of guiding services for the illegal taking of wildlife.
The indictment alleges that from 2003 to 2007, Foiles conspired with others to knowingly transport and sell ducks and geese that had been hunted and killed in violation of federal laws protecting migratory birds. In particular, Foiles is alleged to have sold guided waterfowl hunts at the Fallin’ Skies Strait Meat Duck Club in Pike County, Ill., for the purpose of illegally hunting and killing ducks and geese in excess of hunters’ individual daily bag limits. Foiles and his associates are also alleged to have falsified hunting records at the club in order to conceal the excesses, and to have filmed the illegal hunts for inclusion in commercial hunting videos.
An indictment is merely an accusation, and a defendant is presumed innocent unless and until proven guilty in a court of law.
The maximum penalty for a felony violation of the Lacey Act or the federal false writing statute includes up to five years in prison and a $250,000 fine.
The case was investigated by the U.S. Fish & Wildlife Service, in cooperation with the Illinois Department of Natural Resources, the Iowa Department of Natural Resources, and the government of Canada. The case is being prosecuted by the U.S. Attorney’s Office for the Central District of Illinois and the Justice Department’s Environmental Crimes Section.
Maryland Man Indicted for Operating a Child Pornography Online Bulletin BoardRead the Press Release
WASHINGTON - A federal grand jury in Greenbelt, Md., has indicted George Sell, 68, of Cumberland, Md., for advertising, transporting, receiving and possessing child pornography in connection with his operation of an online bulletin board in which members circulated images of child pornography and links to other child pornography websites.
The indictment, returned on Aug. 30, 2010, and unsealed today, was announced by Assistant Attorney General Lanny A. Breuer of the Criminal Division; U.S. Attorney Rod J. Rosenstein for the District of Maryland; Acting Postal Inspector in Charge Keith A. Fixel of the U.S. Postal Inspection Service (USPIS) - Washington Division; and Special Agent in Charge William Winter of U.S. Immigration and Customs Enforcement (ICE), Office of Homeland Security Investigations.
According to the 10-count indictment, Country Lounge is a secure web-based bulletin board that at various times during the conspiracy was located on servers in Virginia and Texas, which advertised and offered for dissemination pictures and Internet web addresses directing members to secure websites depicting the sexual abuse of minors. A member could join this group only upon invitation and after approval by the group’s administrators. To obtain access to Country Lounge, a member had to have a log-in username and password. Members were instructed by a specific set of rules and guidelines on how to post images using Country Lounge in order to avoid detection from law enforcement. As of August 2008, 142 members belonged to Country Lounge.
The indictment alleges that Sell managed the day-to-day operations of Country Lounge. From December 2006 to August 2008, Sell allegedly conspired with others to publish notices and advertisements on Country Lounge, seeking and offering to trade and distribute Internet web addresses directing members to websites depicting the sexual abuse of minors. Sell, along with other co-conspirators, allegedly arranged for and obtained different web host companies to host County Lounge on computer servers maintained by members of the conspiracy, and decided and assigned a hierarchy of administrators and membership levels to Country Lounge members. Each level of membership contained different duties and responsibilities.
The indictment seeks forfeiture of Sell’s home and any other property used to commit the alleged crimes.
Sell faces a maximum sentence of 30 years in prison for conspiracy to advertise child pornography; 20 years in prison for conspiracy to transport child pornography; 20 years in prison on each of the seven counts of receiving child pornography; and 10 years in prison on each of the two counts for possession of child pornography.
The charges announced today are merely accusations, and a defendant is presumed innocent until and unless proven guilty in a court of law.The charges against Sell are a result of “Operation Nest Egg,” an ongoing and joint international investigation led by the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), the U.S. Attorney’s Office for the Southern District of Indiana, USPIS and ICE. To date, as a result of Operation Nest Egg, more than 80 searches have been conducted in the United States. In total, more than 50 individuals have been arrested and 40 individuals have been convicted. The investigation is ongoing.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
The case is being prosecuted by Assistant U.S. Attorney Stacy Belf, and CEOS Trial Attorneys Darcy Katzin and Jennifer Toritto Leonardo. The case was investigated by the USPIS and ICE.
Líder de organización de narcotráfico colombiana y un asociado fueron encontrados culpables de conspirar para importar múltiples toneladas de cocaína a los Estados UnidosRead the Press Release
WASHINGTON – Christian Fernando Borda y Álvaro Alvaràn-Vélez, dos narcotraficantes alineados con las Autodefensas Unidas de Colombia (AUC), fueron encontrados culpables hoy en el Tribunal Federal de Distrito de conspirar para importar múltiples toneladas de cocaína a los Estados Unidos, anunció el Secretario de Justicia Auxiliar Lanny A. Breuer de la División Criminal. La AUC es un grupo paramilitar colombiano designado por el Departamento de Estado de EE.UU. como organización terrorista extranjera.
Los veredictos de culpable emitidos hoy ocurren después de un enjuiciamiento de siete semanas de duración ante la Juez Federal de Distrito Gladys Kessler en el Distrito de Columbia. Borda, 46, y Alvaràn-Vélez, 56, ciudadanos colombianos, fueron extraditados de Colombia a los Estados Unidos el 29 de octubre de 2009, y el juicio comenzó con la selección del jurado el 21 de octubre de 2010. Después de dos días de deliberaciones, el jurado encontró a Borda y Alvaràn-Vélez culpables de un cargo de conspiración para distribuir cocaína con el conocimiento y la intención de que fuera importada a los Estados Unidos.
"Estos narcotraficantes fueron responsables por facilitar el envío de toneladas de cocaína de Colombia a los Estados Unidos, y hoy 12 miembros del jurado estadounidenses los encontraron culpables", dijo el Secretario de Justicia Auxiliar Breuer. "A lo largo de muchos años, los Estados Unidos y Colombia han trabajado juntos para enjuiciar en ambos países a los líderes y asociados de estas organizaciones peligrosas, y hoy representa otro acontecimiento importante en dicha labor continua".
De acuerdo con el expediente judicial y pruebas presentadas en el juicio, entre febrero de 2005 y el 16 de marzo de 2007, Borda y Alvaràn-Vélez eran miembros de una organización de narcotráfico importante con sede en Colombia que transportó múltiples toneladas de cocaína de Colombia a los Estados Unidos vía México.
Borda, como líder de dicha organización de narcotráfico, obtuvo grandes cantidades de cocaína de fuentes paramilitares colombianas e instruyó a otros en sus actividades de narcotráfico. Alvaràn-Vélez, un asociado de Borda, coordinó y facilitó envíos de cocaína a través de sus contactos en México.
De acuerdo con el expediente judicial y pruebas presentadas en el enjuiciamiento, uno de los envíos de cocaína en 2005 fue por aproximadamente 1,500 kilogramos de cocaína que fue contrabandeada en tambores de aceite de palma en un barco que partió de la costa norte de Colombia. Embarques adicionales de cocaína en 2005 y 2006 fueron por cantidades superiores a 3,000 kilos por embarque.
Las pruebas presentadas en el juicio incluyeron numerosas conversaciones grabadas de reuniones en persona y llamadas telefónicas, así como vigilancia efectuada por la Administración de Control de Drogas [Drug Enforcement Administration (DEA)], incluidos videos y fotos. Pruebas adicionales revelaron envíos de millones de dólares de producto del narcotráfico, todo en moneda estadounidense, a Borda en Colombia vía Monterrey, México y Ciudad de México.
La emisión de las sentencias de Borda y Alvaràn-Vélez está programada para el 28 de abril de 2011. El cargo de conspiración conlleva una sentencia en prisión mínima obligatoria de 10 años y una sentencia máxima de prisión perpetua, así como una multa de hasta $4 millones de dólares. Borda tiene una condena anterior por delito mayor de narcotráfico y, por lo tanto, enfrenta una sentencia mínima obligatoria de 20 años en prisión. Como parte de sus pedidos de extradición, los Estados Unidos han asegurado que no buscarán obtener una sentencia de prisión perpetua para los demandados, sino que solicitarán una sentencia de años en prisión.
Este caso fue investigado por las Divisiones Locales de Miami y Houston de la DEA, con la asistencia de las oficinas de la DEA en Cartagena y Bogotá, Colombia, y Ciudad de México y Guadalajara, México. La Guardia Costera de EE.UU. proporcionó asistencia valiosa adicional en la investigación. La investigación también contó con la cooperación estrecha de la Policía Nacional Colombiana y la Fiscalía Colombiana.
Están a cargo de la acusación en el caso los Abogados Litigantes Paul W. Laymon, Robert J. Raymond y Charles D. Griffith Jr., de la Sección de Narcóticos y Drogas Peligrosas de la División Criminal. La Oficina de Asuntos Internacionales de la División Criminal brindó importante asistencia en la extradición de estos demandados.
Leader of Colombian Drug Trafficking Organization and Associate Found Guilty of Conspiring to Import Multiple Tons of Cocaine into the United StatesRead the Press Release
WASHINGTON – Christian Fernando Borda and Alvaro Alvaran-Velez, two narcotics traffickers aligned with the Autodefenses Unidas de Colombia (AUC), were found guilty today in U.S. District Court of conspiring to import ton-quantities of cocaine into the United States, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division. The AUC is a Colombian paramilitary group designated by the U.S. Department of State as a
foreign terrorist organization.
The guilty verdicts returned today follow a seven-week trial before U.S. District Judge Gladys Kessler in the District of Columbia. Borda, 46, and Alvaran-Velez, 56, who are Colombian nationals, were extradited from Colombia to the United States on Oct. 29, 2009, and trial began with jury selection on Oct. 21, 2010. Following two days of deliberations, the jury found Borda and Alvaran-Velez guilty of one count of conspiring to distribute cocaine with the knowledge and intent that it would be imported into the United States.
"These drug traffickers were responsible for facilitating the delivery of tons of cocaine from Colombia into the United States, and today 12 U.S. jurors found them guilty," said Assistant Attorney General Breuer. "Over the course of many years, the United States and Colombia have worked together to bring to justice in both countries the leaders and associates of these dangerous organizations, and today marks another milestone in that continued effort."
According to court documents and evidence presented at trial, between February 2005 and March 16, 2007, Borda and Alvaran-Velez were members of a major narcotics trafficking organization based in Colombia that transported multi-ton quantities of cocaine from Colombia to the United States via Mexico.
Borda, as the leader of this drug trafficking organization, obtained large amounts of cocaine from Colombian paramilitary sources and directed others in their drug trafficking activities. Alvaran-Velez, an associate of Borda, coordinated and facilitated shipments of cocaine through his Mexico contacts.
According to court documents and trial evidence, one of their shipments of cocaine in 2005 involved approximately 1,500 kilograms of cocaine that was smuggled in drums of palm oil on a ship departing from the north coast of Colombia. Additional cocaine shipments in 2005 and 2006 involved quantities of more than 3,000 kilograms per shipment.
The evidence at trial included numerous recorded conversations from in-person meetings and telephone calls, as well as surveillance by the Drug Enforcement Administration (DEA), including photos and videos. Additional evidence revealed shipments of millions of dollars of narcotics-related proceeds, all in U.S. currency, to Borda in Colombia via Monterrey, Mexico, and Mexico City.
Borda and Alvaran-Velez are scheduled to be sentenced on April 28, 2011. The conspiracy charge carries a mandatory minimum prison sentence of 10 years and a maximum penalty of life in prison, as well as a fine of up to $4 million. Borda has a prior felony narcotics conviction and thus faces a mandatory minimum sentence of 20 years in prison. As part of its extradition requests, the United States provided assurances that it will not seek a life sentence for the defendants, but instead will ask for a prison term of years.
This case was investigated by the DEA’s Miami and Houston Field Divisions, with assistance from DEA’s Cartagena and Bogota, Colombia, and Mexico City and Guadalajara, Mexico, country offices. The U.S. Coast Guard provided valuable additional investigative assistance. The investigation also involved close cooperation with the Colombian National Police and the Colombian Fiscalia.
This case is being prosecuted by Trial Attorneys Paul W. Laymon, Robert J. Raymond and Charles D. Griffith Jr., of the Criminal Division’s Narcotic and Dangerous Drug Section. The Criminal Division’s Office of International Affairs provided substantial assistance in affecting the extradition of these defendants.
Florida Physician Pleads Guilty to Conspiracy in Fraudulent Lobbying and Fund Raising SchemeRead the Press Release
WASHINGTON — A Florida physician pleaded guilty today in U.S. District Court in Fort Lauderdale, Fla., for his role in a fraud scheme involving lobbying and fund raising for political candidates and organizations, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division.
Alan D. Mendelsohn, 52, of Broward County, Fla., pleaded guilty today before U.S. District Judge William J. Zloch, to a one-count criminal information, charging him with conspiracy to commit mail fraud, to make false statements and to file false tax returns. Mendelsohn faces up to five years in prison and a $250,000 fine. Sentencing has been set for Feb. 17, 2011.
According to plea documents, Mendelsohn entered into an agreement with a lobbyist and campaign consultant to create political entities for the purpose of raising money in support of political parties and candidates for political office in Florida. Between 2002 and 2007, Mendelsohn engaged in various lobbying activities that raised several million dollars in contributions for these political organizations, as well as for a pre-existing political entity of which Mendelsohn was an officer.
Mendelsohn admitted that from 2003 through 2008, he and his co-conspirator agreed to siphon approximately $330,000 from the political entities in direct and third party payments for Mendelsohn’s benefit. Mendelsohn also admitted that from 2003 through 2005 he caused certain lobbyists and in some cases their clients to make contributions totaling $50,000 to a private school his children attended in exchange for lobbying services. The funds were then used to pay tuition for Mendelsohn’s children. Mendelsohn caused another client to send a $75,000 wire transfer to a car dealer to purchase a car for Mendelsohn’s personal use, in exchange for his lobbying services. As Mendelsohn admitted, none of this income was reported to the Internal Revenue Service (IRS) as required.
From 2003 through mid-2006, Mendelsohn also admitted that he knowingly mischaracterized personal expenses totaling approximately $163,770 as business deductions, which had the result of illegally reducing the amount of income paid to Mendelsohn that his medical practice reported to the IRS in each of those years.
In total, Mendelsohn underreported his taxable income by more than $600,000 based on the various schemes. Moreover, Mendelsohn admitted that he caused the political entities, as well as certain corporations used to facilitate the conspiracy, to file false federal tax returns and information, and required state disclosure reports that mischaracterized these payments.
As part of the scheme, Mendelsohn also admitted that from 2003 through 2005 he and his co-conspirator used $82,000 from the political entities to make multiple payments to a person associated with a Florida state senator. Mendelsohn admitted that he knew some or all of the payments were benefitting the public official by allowing the public official to receive money without paying taxes on the money.
In addition, Mendelsohn admitted that beginning in late April and early May 2007, Mendelsohn contacted a Florida businessman, who previously had made large contributions to the political entities at Mendelsohn’s request, to solicit additional contributions that would be used by one of the entities to support a candidate for the Florida legislature. According to court documents, in order to persuade the contributor to make the payments, Mendelsohn told the contributor that he had reached an agreement with a senior public official in the Florida state government to use his office to have federal authorities close an investigation of the contributor and his businesses. Mendelsohn admitted that his representation to the contributor was false, and that at various times he falsely told the contributor that the official and an intermediary were taking action on the contributor’s behalf. Ultimately, the contributor provided Mendelsohn with two checks totaling $150,000, made payable to one of the political entities.
Finally, Mendelsohn admitted that he falsely told FBI agents that the $75,000 payment for the car was a gift and not income from lobbying services. Similarly, Mendelsohn admitted that he lied to FBI agents when he claimed that he had never received any personal benefits from the political entities for which he raised money.
This case is being prosecuted by Senior Trial Attorney Mary K. Butler and Trial Attorney Eric G. Olshan of the Criminal Division’s Public Integrity Section. This case was investigated by the Miami Division of the FBI and the Criminal Investigation Division of the Internal Revenue Service in Deerfield, Fla.
El Secretario de Justicia de los Estados Unidos expresa oposición a legislación que obstaculiza el traslado de detenidos de GuantánamoRead the Press Release
WASHINGTON—El Secretario de Justicia de los Estados Unidos Eric Holder le escribió al Líder Mayoritario del Senado Harry Reid y el Líder Minoritario del Senado Mitch McConnell hoy oponiéndose al texto de la Ley de Asignaciones Continuas para el Año 2011 Entero propuesta, la que prohibiría el traslado de detenidos de las instalaciones de detención de la Bahía de Guantánamo, Cuba, a los Estados Unidos por cualquier motivo, incluido para ser juzgados.
El texto de la carta se encuentra a continuación.
9 de diciembre de 2010
Al Honorable Harry Reid
Líder Mayoritario
Senado de los Estados Unidos
Washington, DC 20510
Al Honorable Mitch McConnell
Líder Minoritario
Senado de los Estados Unidos
Washington, DC 20510
Estimados Senadores Reid y McConnell:
Les escribo para oponerme a la Sección 1116 de la Ley de Asignaciones Continuas para el Año 2011 Entero propuesta, la que prohibiría el uso de fondos para trasladar a detenidos de las instalaciones de detención de la Bahía de Guantánamo a los Estados Unidos, por el motivo que fuera. Esta disposición va mucho más allá de la ley existente y limitaría imprudentemente la capacidad del Poder Ejecutivo de enjuiciar a supuestos terroristas en tribunales federales o comisiones militares en los Estados Unidos, así como su capacidad de encarcelar a las personas condenadas en dichos tribunales.
A fin de proteger al pueblo estadounidense de la manera más efectiva posible, debemos estar en posición de utilizar todo instrumento lícito de poder nacional para asegurar que los terroristas sean enjuiciados y ya no puedan poner en peligro las vidas de ciudadanos estadounidenses. Como refleja el discurso de Archivos Nacionales del Presidente en mayo de 2009, como Comandante en Jefe, el Presidente ha determinado que los enjuiciamientos de supuestos terroristas en tribunales del Artículo III por delitos penales de terrorismo promulgados por el Congreso—una herramienta poderosa y bien establecida que ha sido utilizada con éxito en centenas de casos—deben ser posibles a fin de proteger a la nación.
La Sección 1116 es una limitación extrema y arriesgada de la autoridad del Poder Ejecutivo de determinar cuándo y dónde enjuiciar a sospechosos de terrorismo. Dichas decisiones deben basarse en los hechos y circunstancias de cada caso y los intereses generales de seguridad nacional de los Estados Unidos. La Sección 1116 debilitaría mi capacidad como Secretario de Justicia de los Estados Unidos de enjuiciar casos en tribunales del Artículo III, quitándome una de las armas más potentes en la lucha contra el terrorismo.
Sería imprudente, por lo tanto, y establecería un precedente peligroso con implicaciones graves para la administración imparcial de la justicia, que el Congreso limitara la discreción del Poder Ejecutivo de enjuiciar a terroristas en estas jurisdicciones. El ejercicio de la discreción con respecto al proceso judicial siempre ha sido y debe seguir siendo una función del Poder Ejecutivo.
No hemos logrado identificar ningún paralelo a la Sección 1116 en la historia de nuestra nación en la que el Congreso haya intervenido para prohibir el enjuiciamiento de determinadas personas o delitos. Sería un error atar las manos del Presidente y de sus asesores en seguridad nacional ahora.
Por estos motivos, les ruego que eliminen la Sección 1116 del proyecto de ley o de cualquier otro proyecto de ley de asignaciones presupuestarias que el Senado pueda considerar.
Atentamente,
Eric H. Holder, Jr.
Secretario de Justicia de los Estados Unidos
Columbus, Ohio, Real Estate Agent Sentenced to 18 Months in Prison for Mortgage Fraud and Obstruction of JusticeRead the Press Release
WASHINGTON - Bonnie Helt of Columbus, Ohio, was sentenced to 18 months in prison by U.S. District Court Judge Michael H. Watson in Columbus for conspiring to commit mortgage fraud and obstruction of justice, the Justice Department and Internal Revenue Service (IRS) announced today.
According to court testimony and documents, Helt was the real estate agent for convicted Columbus-area home builder, Thomas Parenteau. Helt conspired with Parenteau to commit bank and wire fraud schemes through which the pair defrauded banks and financial institutions of more than $7 million by falsely inflating the purchase prices of the homes that Parenteau built and sold in exchange for the payment of large undisclosed or disguised kickbacks to the buyers after their purchases. After learning of the IRS investigation into their schemes, Parenteau, Helt and others engaged in a scheme to obstruct justice by destroying documents and lying to federal and local investigators. A jury convicted Parenteau for his role in these crimes in July of this year after a two-month trial. Helt pleaded guilty to these crimes in January of this year.
In addition to the prison term, Judge Watson ordered Helt to serve a five-year term of supervised release after her term of imprisonment, and to pay restitution to the victim financial institutions in an amount to be determined by the court within 90 days. Finally, the court ordered Helt to forfeit to the United States government $124,544, which represented the amount of commissions she earned on the fraudulent real estate deals in which she participated.
Helt's co-conspirators, Marsha K. Parenteau and Pamela A. McCarty, are scheduled to be sentenced for their respective roles in these schemes on January 5, 2011. The sentencing for Mr. Parenteau is not yet scheduled.
John A. DiCicco, Acting Assistant Attorney General for the Justice Department's Tax Division, commended the IRS Criminal Investigation special agents who investigated the case, as well as Tax Division trial attorneys Richard Rolwing and Sean O'Connell, who prosecuted the case.
Attorney General Expresses Opposition to Legislation Blocking Transfer of Guantanamo DetaineesRead the Press Release
WASHINGTON—Attorney General Eric Holder wrote to Senate Majority Leader Harry Reid and Senate Minority Leader Mitch McConnell today in opposition to language in the proposed 2011 Full-Year Continuing Appropriations Act that would prohibit the transfer of detainees from the detention facility in Guantanamo Bay, Cuba, to the United States for any purpose, including to stand trial.
The text of the letter is below.
December 9, 2010
The Honorable Harry Reid
Majority Leader
United States Senate
Washington, DC 20510
The Honorable Mitch McConnell
Minority Leader
United States Senate
Washington, DC 20510
Dear Senators Reid and McConnell:
I write in opposition to Section 1116 of the proposed 2011 Full-Year Continuing Appropriations Act, which would prohibit the use of any funds to transfer detainees from the detention facility in Guantanamo Bay, Cuba, to the United States for any purpose. This provision goes well beyond existing law and would unwisely restrict the ability of the Executive branch to prosecute alleged terrorists in Federal courts or military commissions in the United States as well as its ability to incarcerate those convicted in such tribunals.
In order to protect the American people as effectively as possible, we must be in a position to use every lawful instrument of national power to ensure that terrorists are brought to justice and can no longer threaten American lives. As reflected in the President’s National Archives speech in May 2009, he, as Commander-in-Chief, has determined that prosecutions of alleged terrorists in Article III courts for the criminal terrorism offenses Congress has enacted—a powerful and well-established tool that has been used successfully in hundreds of cases—should be available in this effort to protect the nation.
Section 1116 is an extreme and risky encroachment on the authority of the Executive branch to determine when and where to prosecute terrorist suspects. Such decisions should be based on the facts and circumstances of each case and the overall national security interests of the United States. Section 1116 would undermine my ability as Attorney General to prosecute cases in Article III courts, thereby taking away one of our most potent weapons in the fight against terrorism.
It would therefore be unwise, and would set a dangerous precedent with serious implications for the impartial administration of justice, for Congress to restrict the discretion of the Executive branch to prosecute terrorists in these venues. The exercise of prosecutorial discretion has always been and must remain an Executive branch function.
We have been unable to identify any parallel to Section 1116 in the history of our nation in which Congress has intervened to prohibit the prosecution of particular persons or crimes. It would be a mistake to tie the hands of the President and his national security advisers now.
For these reasons, I urge you to remove Section 1116 from the bill or from any other appropriations bill that the Senate may consider.
Sincerely,
Eric H. Holder, Jr.
Attorney General
Justice Department Reaches Settlement with National Mortgage Lender to Resolve Allegations of Lending DiscriminationRead the Press Release
WASHINGTON – PrimeLending, a national mortgage lender with 168 offices in 32 states at the end of 2009, has agreed to pay $2 million to resolve allegations that it engaged in a pattern or practice of discrimination against African-American borrowers between 2006 and 2009.
The settlement was filed today in conjunction with a complaint made by the Justice Department in federal court in Dallas, where PrimeLending is headquartered. Brought under the federal Fair Housing Act and Equal Credit Opportunity Act, the complaint alleges African-American borrowers nationwide were charged higher prices on retail loans made through PrimeLending’s branch offices.
“Charging borrowers more to obtain a home loan based on their race is absolutely intolerable, but it is a practice that occurred all too often during the past decade and stripped a vast amount of wealth from communities of color,” said Thomas E. Perez, Assistant Attorney General in charge of the Justice Department’s Civil Rights Division. “We will be vigilant to ensure that this type of discriminatory practice does not continue in the current credit market. Vigorous enforcement of fair lending laws is a top priority, and we will continue aggressively to pursue compensation for the victims of such discrimination.”
“Illegal and unfair lending takes an immediate toll on families and communities. Moreover, its harm, if unchecked, damages economic opportunities for the next generation,” said John Trasviña, Assistant Secretary for Fair Housing and Equal Opportunity. “HUD joins the Department of Justice to take every step to ensure that all people are fairly served by lending institutions.”
“The Federal Reserve rigorously enforces the fair lending laws. There is no place for racial or other illegal discrimination in our credit markets,” said Elizabeth A. Duke, Member, Board of Governors of the Federal Reserve System. “We expect lenders that we supervise to be fully committed to fair lending and to have controls in place to prevent illegal discrimination.”
Between 2006 and 2009, PrimeLending charged African-American borrowers higher annual percentage rates of interest for prime fixed-rate home loans and for home loans guaranteed by the Federal Housing Administration and Department of Veterans Affairs than it charged to similarly-situated white borrowers. PrimeLending gave its employees wide discretion to increase their commissions by adding “overages” to loans, which increased the interest rates paid by borrowers. This policy had a disparate impact on African-American borrowers. The Justice Department for more than a decade has identified the charging of overages as a means by which lending discrimination can occur.
During the period when the discrimination occurred, PrimeLending was rapidly increasing its lending operations, becoming one of the nation’s 20 largest FHA lenders by 2009. PrimeLending did not have monitoring in place to ensure that it complied with the fair lending laws, even as it grew to originate more than $5.5 billion in loans per year.
This case resulted from a referral by the Board of Governors of the Federal Reserve to the Justice Department’s Civil Rights Division in 2009. PrimeLending’s owner, PlainsCapital Bank of Lubbock, Texas, is a member of the Federal Reserve System. PrimeLending cooperated fully with the Justice Department’s investigation into its lending practices and agreed to settle this matter without contested litigation.
In addition to paying $2 million to the victims of discrimination, the settlement requires PrimeLending to have in place loan pricing policies, monitoring and employee training that ensure discrimination does not occur in the future. It also incorporates provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act and regulations recently enacted by the Federal Reserve that restrict loan officer compensation based on the terms or conditions of a particular transaction. PrimeLending began at the start of this year to implement policies to prevent discrimination, which include requiring employees to provide legitimate non-discriminatory reasons in order to adjust loan prices. These policies will be strengthened by generally banning overages beginning next spring.
The Civil Rights Division and other agencies involved in this matter are part of the Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes. One of the task force’s key initiatives, led by the Department of Housing and Urban Development, the Department of Justice and the Federal Reserve Board, is to ensure that discrimination does not occur when borrowers receive FHA loans. For more information on the task force, visit www.stopfraud.gov.
A copy of the complaint and settlement order with PrimeLending, as well as additional information about fair lending enforcement by the Justice Department, can be obtained from the Justice Department website at www.justice.gov/fairhousing .
Gary, Indiana, Wastewater Treatment Operator and Managers Charged with Conspiracy and Violating the Clean Water ActRead the Press Release
WASHINGTON – United Water Services Inc., the former contract operator of the Gary Sanitary District wastewater treatment works in Gary, Ind., and two of its employees, were charged today with conspiracy and felony violations of the Clean Water Act in a 26-count indictment returned by a federal grand jury, the Justice Department announced today.
United Water Services Inc., and employees Dwain L. Bowie, and Gregory A. Ciaccio, have been charged with manipulating daily wastewater sampling methods by turning up disinfectant treatment levels shortly before sampling, then turning them down shortly after sampling.
United Water Services entered into a 10-year contract to operate the Gary Sanitary District wastewater treatment works in 1998, in exchange for $9 million annually. United Water’s contract was renewed in May 2008. As contract operator, United Water handled the operation and maintenance of the treatment works, and was responsible for environmental compliance. To ensure compliance with the discharge permit, United Water was required to take periodic representative wastewater samples, including a daily sample to determine the concentration of E. coli bacteria in the wastewater.
According to the indictment, the defendants conspired to tamper with E. coli monitoring methods by turning up levels of disinfectant dosing prior to E. coli sampling. The indictment states that the defendants would avoid taking E. coli samples until disinfectants had reached elevated levels, which in turn were expected to lead to reduced E. coli levels. Immediately after sampling, the indictment alleges, the defendants turned down disinfectant levels, thus reducing the amount of treatment chemicals they used.
Dwain Bowie was United Water’s Project Manager for the Gary facility beginning in 2002, and was in charge of the Gary operation. Gregory Ciaccio joined Bowie’s staff in July 2003, and eventually was made the Plant Superintendent, in charge of day-to-day operations.
The Clean Water Act makes it a felony to tamper with required monitoring methods at a permitted facility like the Gary Sanitary District. If convicted, Bowie and Ciaccio face up to five years in prison on the conspiracy count and two years on each of the Clean Water Act counts, as well as a criminal fine of up to $250,000 for each count. The company may also face fines and/or probation.
The allegations in the indictment are mere accusations and all persons are presumed innocent until and unless proven guilty beyond a reasonable doubt in a court of law.
The case was investigated by the Northern District of Indiana Environmental Crimes Task Force, including agents from the Criminal Investigation Division of the U.S. Environmental Protection Agency, the FBI and the Indiana State Police. The case is being prosecuted by the U.S. Attorney’s Office for the Northern District of Indiana and the Justice Department’s Environmental Crimes Section.
EPA and the Commonwealth of Kentucky Reach Agreement with Logan Aluminum Inc. to Resolve Allegations of Clean Air Act ViolationsRead the Press Release
WASHINGTON – The Department of Justice on behalf of the U.S. Environmental Protection Agency, along with the Commonwealth of Kentucky, have filed a complaint and entered into a consent decree with Logan Aluminum Inc. to settle alleged violations of the Clean Air Act’s National Emission Standards for Hazardous Air Pollutants for Secondary Aluminum Production occurring at Logan Aluminum’s Russellville, Ky., secondary aluminum facility.
The proposed consent decree resolves claims of the United States and the commonwealth under the Clean Air Act and related provisions of the laws of the commonwealth. Under the terms of the decree, Logan Aluminum will pay a civil penalty of $285,000 and install a pollution control device called a baghouse for one of its furnace’s capture/collection systems. The civil penalty is the second highest to be negotiated in dealing with a single facility for violations of the Clean Air Act’s secondary aluminum production regulations.
Logan Aluminum manufactures aluminum coils which are used in the beverage industry. Part of the production process for these coils causes emissions of potential pollutants such as dioxins and furans, hydrogen chloride and particulate matter.
The complaint was filed and the consent decree lodged contemporaneously in the U.S. District Court for the Western District of Kentucky on Dec. 8, 2010. Notice of the lodging of the consent decree will appear in the Federal Register allowing for a 30-day public comment period before the consent decree can be entered by the court as final judgment.