Eastern District of Pennsylvania

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced today the unsealing of a 21-count Superseding Indictment charging 14 individuals with drug trafficking and firearms offenses. The defendants are members of a drug trafficking group led by defendant Herbert Robinson (“Robinson DTG”).

The Superseding Indictment alleges that the defendants, several of whom had prior drug trafficking offenses, distributed hundreds of kilograms of cocaine in the Philadelphia area and elsewhere from at least February 2019 to January 2021. As alleged in the Superseding Indictment, Robinson and other high-ranking members of the DTG regularly traveled internationally to meet with drug suppliers in Mexico, Colombia, and Jamaica. During the course of the investigation, law enforcement seized approximately 169 kilograms of cocaine, $8.26 million in cash drug proceeds, and four firearms.

The individuals charged include:

• Herbert Robinson, 48, of Lower Gwynedd, PA
• Samyre Washington, 38, of Wyncote, PA
• Ross Brooks, 48, of Philadelphia, PA
• Melvin Butler, 60, of Compton, CA
• Marcus Washington, 43, of Philadelphia, PA
• Marvin Watson, 44, of Glen Mills, PA
• Randall Overton, 39, of Philadelphia, PA
• Frank Singleton, 50, of Upper Darby, PA
• James Leonard Flack, Jr., 54, of Philadelphia, PA
• Kashon Adade, 36, of Lansdowne, PA
• Antonio Simmons, 49, of Gahanna, OH
• Von Oscar Tyler, 56, of Temple Hills, MD
• Gilberto Alaniz, 34, of Mercedex, TX
• L.B. Nelson, 44, of Inglewood, CA

Thirteen defendants have pleaded guilty. The remaining defendant, a fugitive, passed away after the Superseding Indictment was returned. Several members of the Robinson DTG pleaded guilty to additional drug charges, money laundering, and tax crimes, charged via three separate Informations in the Eastern District of Pennsylvania.

The case was investigated by the Drug Enforcement Administration, Internal Revenue Service, and Philadelphia District Attorney’s Office, with assistance from Pennsylvania State Police – SHIELD Unit, Delaware State Police, New Jersey State Police, Philadelphia Police Department, and Homeland Security Investigations. The case is being prosecuted by Assistant United States Attorney Francis A. Weber.

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced that Zhenyu (“Bill”) Wang, 42, of Dallas, Texas, and Daniel Ray Lane, 42, of McKinney, Texas, were convicted at trial on charges of attempting to violate the International Emergency Economic Powers Act (“IEEPA”), conspiracy to violate IEEPA, and conspiracy to commit money laundering based on their attempt to transact in sanctioned Iranian petroleum and launder the proceeds.

At trial, the evidence showed that in 2019 and early 2020, the defendants engaged in a conspiracy to purchase petroleum from Iran, in violation of economic sanctions imposed by the United States under IEEPA. They then planned to mask the origins of the petroleum and sell it to a refinery in China. The defendants also attempted to conceal their illegal transactions by obtaining foreign passports, engaging in sham contractual agreements, and conspiring to launder the proceeds of the sale through shell entities and offshore financial accounts. For example, Lane offered to use the mineral rights that his company sold to launder proceeds for the Iranian sellers. In addition, Wang arranged for bribe payments to be paid the Chinese officials and bankers.

“As shown at trial, the defendants schemed to buy Iranian oil, hide its origins, and sell it to a refinery in China in clear disregard for U.S. sanctions against the Teheran regime,” said Assistant Attorney General Matthew G. Olsen of the Justice Department’s National Security Division. “We will not tolerate anyone who violates our sanctions laws and imperils national security for personal profit. Like the defendants today, those who try will be held to account.”

“The defendants in this case flouted the national security interests of the United States by directly violating economic sanctions,” said U.S. Attorney Romero. “Conspiring to violate sanctions and commit money laundering in the process is a serious offense, and will not be tolerated.”

“For financial gain, these co-conspirators sought to evade sanctions put in place to protect the United States’ national security,” said Richard Langham, Acting Special Agent in Charge of the FBI’s Philadelphia Division. “A criminally bad idea, as this verdict clearly shows. The FBI will bring all our investigative resources to the table to halt such harmful acts.”

Wang and Lane face each a maximum statutory penalty of 45 years in prison total, five years for conspiracy to violate IEEPA and twenty years for each for attempting to violate the IEEPA and conspiracy to commit money laundering. The defendants are scheduled to be sentenced on February 29, 2024.

The case was investigated by the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorneys Patrick Murray and Mary Crawley with valuable assistance provided by Beau Barnes and David Recker of the National Security Division’s Counterintelligence and Export Control Section.

Zhenyu “Bill” Wang, 42, of Dallas, and Daniel Ray Lane, 42, of McKinney, Texas, were convicted at trial on Nov. 15 on charges of attempting to violate the International Emergency Economic Powers Act (IEEPA), conspiracy to violate IEEPA, and conspiracy to commit money laundering in connection with their attempt to transact in sanctioned Iranian petroleum and launder the proceeds.

According to evidence presented at trial, in 2019 and early 2020, the defendants engaged in a conspiracy to purchase petroleum from Iran, in violation of economic sanctions imposed by the United States under IEEPA. They then planned to mask the origins of the petroleum and sell it to a refinery in China. The defendants also attempted to conceal their illegal transactions by obtaining foreign passports, engaging in sham contractual agreements, and conspiring to launder the proceeds of the sale through shell entities and offshore financial accounts. For example, Lane offered to use the mineral rights that his company sold to launder proceeds for the Iranian sellers. In addition, Wang arranged for bribe payments to be paid the Chinese officials and bankers.

“These defendants schemed to buy Iranian oil, hide its origins, and sell it to a refinery in China in disregard of U.S. sanctions against Iran,” said Assistant Attorney General Matthew G. Olsen of the Justice Department’s National Security Division. “The Justice Department will not tolerate those who would violate U.S. sanctions and imperil our national security for personal profit.”

“The defendants in this case flouted the national security interests of the United States by directly violating economic sanctions,” said U.S. Attorney Jacqueline C. Romero for the Eastern District of Pennsylvania. “Conspiring to violate sanctions and commit money laundering in the process is a serious offense and will not be tolerated.”

“For financial gain, these co-conspirators sought to evade sanctions put in place to protect the United States’ national security,” said Acting Special Agent in Charge Richard Langham of the FBI Philadelphia Field Office. “A criminally bad idea, as this verdict clearly shows. The FBI will bring all our investigative resources to the table to halt such harmful acts.”

Wang and Lane, as well as three co-conspirators, were originally charged by complaint in February 2020, and the defendants and two co-conspirators were indicted on the above charges in August 2020. Wang and Lane face each a maximum penalty of 45 years in prison: five years for conspiracy to violate IEEPA and 20 years for each attempting to violate the IEEPA and conspiracy to commit money laundering counts. The defendants are scheduled to be sentenced on Feb. 29, 2024.

The FBI investigated the case.

Assistant U.S. Attorneys Patrick Murray and Mary Crawley for the Eastern District of Pennsylvania are prosecuting the case, with valuable assistance provided by Trial Attorney Beau Barnes of the National Security Division’s Counterintelligence and Export Control Section.

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced that Joseph Cammarata, 49, of Monmouth Beach, New Jersey was found guilty on November 15, 2023, on five counts of tax evasion following a two-week trial in the District of New Jersey before U.S. District Judge Peter G. Sheridan.

According to documents filed in this case and the evidence at trial:

Cammarata and two conspirators, David Punturieri and Erik Cohen, were the principals of Alpha Plus Recovery, a claims aggregator firm based in Old Bridge, New Jersey. Punturieri and Cohen previously pleaded guilty to tax evasion, fraud, and money laundering charges.

Cammarata, Punturieri, and Cohen used Alpha Plus Recovery to make false and fraudulent claims on the proceeds of securities fraud class action settlements and SEC enforcement actions. They falsely claimed that corporate clients of Alpha Plus Recovery had purchased shares of securities that were the subject of the lawsuits and enforcement actions. In reality, the supposed clients, which were entities actually controlled by the defendants, had not purchased the subject securities and were not entitled to any recovery from the settlements or enforcement actions. To substantiate their false claims, the defendants created fraudulent brokerage and other financial documents to provide to claims administrators. Cammarata and his partners then transferred the fraudulently obtained funds into accounts that they controlled, stealing more than $39 million from 2015 to 2019.

Cammarata’s share of the illegally obtained fraud proceeds amounted to more than $18 million. Cammarata failed to declare or pay taxes on income of $1.72 million in 2015; $2.56 million in 2016; $4.82 million in 2017; $3.56 million in 2018; and $3.35 million in 2019. Cammarata hid this income, which he received through corporate entities, from his accountant in order to conceal these sums from the IRS.

“Last year, a jury in the Eastern District of Pennsylvania found that Cammarata and his partners engaged in a multi-year fraud in order to steal over $40 million,” said U.S. Attorney Romero. “Cammarata then concealed more than $16 million of his proceeds of that fraud from the IRS. The verdict in the New Jersey case makes clear that those who hide income gained by fraud will face the same consequences as those who try to evade their tax obligations from legal sources of income. Thanks to the dedicated efforts of the investigators and prosecutors on this case, this defendant has been brought to justice for the full scale of his criminal conduct.”

“This defendant has now been convicted by two separate juries of serious crimes,” U.S. Attorney Philip R. Sellinger said. “First, he was convicted by a jury in Philadelphia federal court for his role in a scheme to defraud investors out of millions of dollars. Now, a Trenton jury has convicted him of hiding from the IRS the more than $16 million he pocketed as he tried to avoid paying his fair share of taxes. Cammarata will now be held to account for his crimes at sentencing.”

“Year after year, Joseph Cammarata and his partners stole millions from legitimate victim investors entitled to class action settlement funds and hid the illegal proceeds from the IRS,” said Richard Langham, Acting Special Agent in Charge of the FBI’s Philadelphia Division. “Cammarata used the funds to support his lavish lifestyle, including the use of private jets, the purchase of expensive homes, luxury cars, and yachts, and even the maintenance of a private island in The Bahamas. As investigators closed in, Cammarata doubled down on his lies in order to perpetuate the fraud and evade taxes. What Cammarata didn’t know was that Special Agents from the FBI and Postal Inspectors were methodically building a case based on his emails and on phone calls where he and his business partners conspired to lie to claims administrators and the IRS. The FBI is proud to have assisted the IRS in bringing Cammarata to justice.”

“IRS Criminal Investigation special agents are specially equipped to follow the complex financial trail left by criminals, and we are dedicated to holding those accountable for crimes committed,” said Tammy Tomlins, Special Agent in Charge of the IRS Newark Field Office. “Mr. Cammarata and his partners stole millions from his victims. IRS Criminal Investigation Special Agents are committed to working with our law enforcement partners to hold account fraudsters like the defendant.”

“A jury in New Jersey found Joseph Cammarata guilty of defrauding thousands of investors of settlement proceeds and hiding his illegal income from the IRS,” said Christopher Nielsen, the Inspector in Charge of the Philadelphia Division of the Postal Inspection Service. “Since 2014, Mr. Cammarata and his co-conspirators used the United States Mail to submit thousands of fraudulent claims to civil security fraud settlement funds, depriving actual harmed investors of money that they should have received. They collected over $43 million in fraudulent payments and failed to report their newfound income to the IRS. From 2015 to 2019, Mr. Cammarata collected over $18 million in the scheme and falsified his tax returns each year to hide his illegal income and his involvement in the scheme. I want to thank the agents from the FBI and the IRS who worked alongside Inspectors from my office in Philadelphia to uncover this scheme. I would also like to thank the Assistant United States Attorneys who supported the investigation and saw the prosecution through.”

Each count of tax evasion is punishable by up to five years in prison. Sentencing has not yet been scheduled.

Cammarata was previously convicted in the Eastern District of Pennsylvania (EDPA) of conspiracy to commit wire fraud and mail fraud, wire fraud, money laundering conspiracy, and money laundering in connection with this scheme. On June 6, 2023, the Honorable Chad F. Kenney sentenced Cammarata to 10 years in prison on those charges. Because Cammarata filed his taxes from New Jersey, the tax evasion case was brought in the District of New Jersey and prosecuted by EDPA Assistant United States Attorneys David J. Ignall and Paul G. Shapiro, who also tried the earlier case.

The case was investigated by the Internal Revenue Service, Criminal Investigation Division, the Federal Bureau of Investigation, the United States Postal Inspection Service, and the United States Securities and Exchange Commission, with trial support from the U.S. Attorney’s Office for the District of New Jersey.

PHILADELPHIA –United States Attorney Jacqueline C. Romero announced that Gloria Byars, 62, of Aldan, PA and Carlton Rembert, 69, of Hampton, VA were both found guilty for their roles in a scheme to defraud elderly, incapacitated people of over $1 million. Byars entered a guilty plea on the eve of trial, pleading guilty to conspiracy, wire fraud, money laundering, and tax fraud. Her co-conspirator and brother Carlton Rembert proceeded to trial and after a four-day trial, a jury found Rembert guilty of conspiracy, bank fraud, and wire fraud.

Between 2012 and 2018, Byars and her co-conspirators stole the life savings from dozens of incapacitated wards while Byars served as their court-appointed guardian. Prior to operating her own guardianship company, Byars was an office manager for a guardianship company in Delaware County that was appointed to care for wards in Pennsylvania. As office manager, and then as guardian herself through her own company, Byars had unfettered access to wards’ property including bank accounts, pensions, real estate, retirement accounts, and other assets. Byars stole money from the wards’ bank accounts by writing unauthorized checks to companies she controlled, or to shell companies controlled by her co-conspirators, Rembert and Alesha Mitchell. Rembert and Mitchell assisted Byars in the theft by opening bank accounts in their home state of Virginia in the names of shell companies purporting to be medical services companies. Rembert and Mitchell deposited dozens of checks containing stolen ward money into their shell business bank accounts, withdrew over $500,000 in cash, and sent most of the stolen proceeds back to Byars, after keeping a share of the stolen ward money for themselves. Byars spent the stolen ward money on vacations, clothing, vehicles, gifts, and parties.

As part of Byars’ plea agreement, she agreed to forfeit 36 gold Krugerrand coins, valuable gold coins first minted in South Africa in the 1960s to introduce the country’s gold supply onto the world market. Byars stole several Krugerrand coins from the bank safe deposit box of one of her wards. Byars also stole over $756,000 from a retired federal employee’s Thrift Savings Plan. In total, Byars and her co-conspirators stole well over $1 million from at least 120 incapacitated people in the Eastern District of Pennsylvania.

Byars and Rembert face the following maximum possible sentences. For conspiracy to commit bank fraud and for bank fraud, the maximum sentence is 30 years’ imprisonment and a $1,000,000 fine. For wire fraud, the maximum sentence is 20 years’ imprisonment and a $250,000 fine. Byars also faces a maximum sentence of 20 years’ imprisonment and a $500,000 fine for money laundering and for filing a false tax return, the maximum sentence is 3 years’ imprisonment and a $250,000 fine.

“Byars and Rembert’s actions caused significant financial and emotional harm to their victims,” said U.S. Attorney Romero. “Fraud, particularly at the expense of vulnerable people, will not be tolerated.”

“Gloria Byars was entrusted with managing the assets of elderly folks unable to do so themselves,” said Richard Langham, Acting Special Agent in Charge of the FBI’s Philadelphia Division. “Instead, she abused her role as a guardian, poaching the nest eggs of these vulnerable wards, figuring they’d never even know. The FBI takes great satisfaction in bringing Byars and her co-conspirators to justice and preventing them from doing more harm. Elder fraud and abuse are simply unconscionable. If you think you’re being victimized like this or know someone who is, please reach out to the FBI – anonymously, if you like.”

“IRS-Criminal Investigation is committed to aggressively investigating individuals who engage in money laundering, tax fraud, or other types of white-collar crimes,” said IRS Criminal Investigation Special Agent in Charge Yury Kruty.  “We, along with our law enforcement partners and the Department of Justice will continue to work to ensure that individuals who attempt to hide their criminal involvement will be held accountable.”

“The conviction of Gloria Byars and Carlton Rembert demonstrates the shared commitment of the Delaware County District Attorney’s Office and United States Attorney’s Office in pursuing justice for our most vulnerable residents. I want to thank the United States Attorney’s Office and Federal Bureau of Investigation for working with us on this important guardianship fraud prosecution. I would also like to thank Douglas Rhoads, Deputy District Attorney of Special Investigations, and Detective Edward Rosen of our Criminal Investigation Division for their work on this matter,” said Delaware County District Attorney Jack Stollsteimer.  

The case was investigated by the Federal Bureau of Investigation, Delaware County District Attorney’s Office, Criminal Investigation Division, and the Internal Revenue Service, Criminal Investigation and is being prosecuted by Assistant United States Attorneys Tiwana Wright and Samuel Dalke.

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced that Charles O’Bannon, 25, of Villa Rica, Georgia, was sentenced to 33 months’ imprisonment for his role in a multi-conspirator firearms trafficking operation that flooded the City of Philadelphia with 292 guns over the course of five months.

United States District Court Judge John M. Younge sentenced O’Bannon for his role in this unprecedented firearms trafficking operation, which involved hundreds of firearms being straw purchased from federal firearms dealers in Atlanta, Georgia, and then transported across state lines for resale on the black market in the City of Philadelphia. This fact pattern is known as the “iron pipeline.” Dozens of firearms have since been recovered by law enforcement at crime scenes and elsewhere. The conspiracy’s guns have taken the lives of two Philadelphians and used to perpetrate violent crime, including shootings, carjackings, and drug trafficking.

Judge Younge had previously sentenced O’Bannon’s conspirators as follows:

• Edwin Burgos, 30, of Philadelphia, Pennsylvania, the leader of the Philadelphia side of the firearms trafficking operation, was sentenced to 120 months’ imprisonment.
• Fredrick Norman, 26, of Villa Rica, Georgia, the leader of the Atlanta side of the firearms trafficking operation, was sentenced to 99 months’ imprisonment.
• Ernest Payton, 31, of Philadelphia, Pennsylvania, was sentenced to 63 months’ imprisonment.
• Kenneth Burgos, 24, of Philadelphia, Pennsylvania, was sentenced to 75 months’ imprisonment.
• Roger Millington, 27, of Philadelphia, Pennsylvania, was sentenced to 48 months’ imprisonment.
• Stephen Norman, 25, of Villa Rica, Georgia, and brother of Fredrick Norman, was sentenced to 27 months’ imprisonment.

“An important piece of our commitment to stopping the illegal flow of guns through the ‘iron pipeline’ is charging crimes like straw purchasing,” said U.S. Attorney Romero. “The substantial prison sentences each defendant received in this case demonstrate that straw purchasing will carry significant consequences.”

“The defendants in this case flooded 300 firearms onto the streets of Philadelphia, a city already plagued with gun violence,” said ATF Special Agent in Charge Eric Degree. “We appreciate the support of the United States Attorney’s Office, the Philadelphia Police Department, the Pennsylvania State Police, and members of our Firearms Trafficking Task Force, which allowed us to dismantle this firearm trafficking organization.”

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.

The case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) and is being prosecuted by Assistant United States Attorney Priya T. De Souza.

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced that Stanislav Bril, 40, a/k/a “Stan Bril,” a/k/a “Slava Bril,” a resident of Jamison, Pennsylvania, entered a plea of guilty on October 30, 2023 before United States District Judge Gene E.K. Pratter to three counts of mail fraud, eleven counts of wire fraud, five counts of bank fraud, and five counts of money laundering, all arising from Bril’s operation of two different Ponzi schemes, his false applications for bank loans, his defrauding of the Small Business Administration’s Paycheck Protection Program (“PPP”) and Economic Injury Disaster Loan (“EIDL”) program, and related conduct.

“The U.S. Attorney’s Office will continue leading the charge with our law enforcement partners to hold Stanislav Bril and other fraudsters accountable for their schemes,” said U.S. Attorney Romero. “These fraud schemes impact us all, from individual investors to taxpayers.  We also appreciated the public’s assistance and cooperation in bringing these cases.”

“Over the course of ten years, Bril perpetrated multiple fraud schemes, stealing variously from investors, a bank, and the U.S. government,” said Richard Langham, Acting Special Agent in Charge of the FBI’s Philadelphia Division. “Fortunately, the FBI and our partners are experts at ensuring criminals like him are held accountable.”

“IRS-Criminal Investigation is proud to have provided its financial expertise in this investigation,” said IRS Criminal Investigation Special Agent in Charge Yury Kruty. “We, along with our law enforcement partners and the Department of Justice, are committed to aggressively investigating individuals who engage in money laundering, tax fraud, or other types of white-collar crimes.”

From October 2011 to August 2014, Bril operated a “Ponzi” scheme through his company, Mortgage Consultant Group (“MCG”), obtaining over $1 million from investors and using much of these funds for his own benefit and to perpetuate the scheme. Bril approached investors and persuaded them to make capital loan investments in MCG. In his marketing materials and his sales pitches to investors, Bril falsely claimed that these investments would enable MCG to make loans on real estate and construction projects or enable MCG to make short-term, high interest loans. Bril falsely promised that investors would obtain regular returns, or “interest,” on their capital loan investments in MCG. Rather than use investors’ funds as promised, Bril used the vast majority of the funds to pay himself, his family, and his personal expenses – including his gambling losses at casinos – and to perpetuate his scheme by occasionally making “interest” payments to some investors.

From October 2018 to June 2021, Bril fraudulently obtained a $750,000 line of credit from a bank headquartered in Scranton, Pennsylvania for another company he created, The Bril Group, Inc. (“TBG”). In order to secure the line of credit, Bril made false statements about TBG’s business, the number of TBG employees he was hiring, and the intended use of the line of credit. Once he obtained the line of credit, Bril caused those funds to be spent on unauthorized purchases and laundered a significant portion of those funds through various bank accounts.

From April 2020 to March 2021, Bril fraudulently obtained over $6.7 million from the Small Business Administration’s Economic Injury Disaster Loan (“EIDL”) and Paycheck Protection Programs (“PPP”) by making false statements about the number of employees of, the wages and payroll taxes paid by, and the intended use of the loan proceeds by several companies that Bril created. Bril falsely claimed that these companies – TBG, MCG LOAN, and SAB Services LLC – had several hundred employees when in fact none of these companies had more than one employee. In his PPP and EIDL applications, Bril submitted allegedly historical tax forms with inflated payroll information for nonexistent employees that had never actually been filed. In addition, Bril falsely denied that there were criminal charges pending against him at the time of his applications. In fact, federal charges were already pending against Bril for his perpetration of the Ponzi scheme detailed above. Once he fraudulently obtained these funds, Bril wired them to other individuals, cryptocurrency platforms, and a title company towards a purchase of a Los Angeles condominium. Bril also laundered a significant portion of those funds through various bank accounts and transactions.

From July 2019 to at least August 2021, Bril revived MCG and used it to perpetrate yet another “Ponzi” scheme, obtaining millions of dollars in loans from several investors and using these funds for his own benefit and to perpetuate the scheme. Bril initially took short-term loans from investors and repaid investors with high interest rates to lull them into a false sense of security and to obtain larger loans from them. In his sales pitches to investors, Bril falsely claimed that their loans would enable MCG to make loans on real estate and construction projects and/or enable MCG to make short-term, high-interest loans. However, Bril provided investors with few details of these purported projects and declined to identify his purported borrowers. Bril often encouraged investors to “rollover” their loans into new deals rather than take their payouts per their agreements with Bril. When investors asked Bril whether he had any claims, lawsuits, or legal proceedings filed against him, Bril falsely answered in the negative despite his knowledge that federal charges were already pending against him for his perpetration of the earlier Ponzi scheme. When Bril began missing the agreed repayments to investors, Bril provided bogus explanations for his theft of their loans, including that he was waiting for a wire to clear, that he waiting for a check to be mailed from his bank, that he was looking for a new bank, that his new bank was giving him a “hard time,” and that he was suffering from a variety of health emergencies and personal tragedies that were somehow preventing him from making timely paying to the investors. Rather than use investors’ funds as promised, Bril used the funds to pay himself, his family, and his personal expenses – including trading in digital currencies – and to perpetuate his schemes by occasionally making “interest” payments to some investors.

The case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service – Criminal Investigation and is being prosecuted by Assistant United States Attorneys Vineet Gauri and Matthew T. Newcomer.  

Philadelphia, PA – On Thursday, October 19, 2023, community members and leaders gathered at the Suzanne Roberts Theatre to watch the first screening in Philadelphia of Repairing the World: Stories from the Tree of Life, United States Attorney Jacqueline C. Romero announced today. The documentary tells the story of Pittsburgh’s powerful community response to hate in the aftermath of the deadliest antisemitic attack in U.S. history. Next week marks the fifth anniversary of the attack.

“Through the voices of survivors, family members, diverse Pittsburgh residents, and leaders, Repairing the World shows the powerful display of unity in a moment of crisis, the resilience of a vibrant city, and a community working together to stand united against hate,” said U.S. Attorney Romero. “In this painful and challenging time in the world, it is a message that we all can learn from and put into action in our own communities.”

Following the screening, host and producer of WHYY’s “Morning Edition” Jennifer Lynn led a panel discussion that included Patrice O’Neill, the film’s producer and director, Alan Mallinger, whose mother was killed and sister was wounded in the shooting, and Maggie Feinstein, director of the 10.27 Healing Partnership. United States Attorney for the Western District of Pennsylvania Eric G. Olshan and members of the trial team that prosecuted and convicted the shooter were also in attendance and shared remarks.

The United States Attorney’s Office for the Eastern District of Pennsylvania hosted the screening and discussion as part of the Department of Justice’s United Against Hate Initiative, in partnership with WHYY and Not In Our Town. The American Jewish Committee, the Anti-Defamation League, the Board of Rabbis of Greater Philadelphia, HIAS Pennsylvania, the Jewish Federation of Greater Philadelphia, and the Weitzman National Museum of American Jewish History cosponsored the screening.

“Hate-based violence and threats hurt not just the victims; they destroy entire communities,” said U.S. Attorney Romero. “In addition to prosecuting these crimes to the fullest extent of the law, my Office, along with our community and law enforcement partners, will continue to shine a light on the impact of these crimes and work with our partners to build the community connections needed to prevent them.”

U.S. Attorney Olshan added, “We were proud to join our colleagues from the Eastern District of Pennsylvania for a viewing of this film, which showcases what those of us who worked on this case have witnessed firsthand for the last five years—the unbelievable strength and resolve of the entire victim community. We will continue to stand beside them in solidarity and to show that together we are stronger than hate.”

“Not In Our Town is honored to present this film to the Philadelphia community with the U.S. Attorney’s Office, WHYY, and our community partners,” said the film’s director and Not In Our Town CEO Patrice O’Neill. “The Pittsburgh community presents powerful lessons about how we can build alliances in our cities and towns that will help us become stronger than hate. We look forward to seeing how Pittsburgh’s story helps spark these discussions here in Philadelphia and across the country.”

WHYY will broadcast the film on Thursday, October 26, 2023, at 9:00 p.m., with an encore presentation on Sunday, October 29, 2023, at 12:30 p.m.

Learn more about the film by visiting https://repairingtheworldfilm.org/. Report suspected hate crimes first to your local law enforcement, then to the FBI at tips.fbi.gov or 1-800-CALL-FBI. You can also report a hate crime, find resources, and learn more about the Department of Justice’s hate crimes prevention and enforcement work by visiting www.justice.gov/hatecrimes.

Two men pleaded guilty today for their roles in creating false calibration certificates in a matter within the jurisdiction of the Nuclear Regulatory Commission (NRC).

According to court documents, Miguel Marcial Amaro, 56, of Newark, Delaware, and Martin Ramos, 52, of Levittown, Pennsylvania, worked for a company that provided acoustic emissions (AE) testing to nuclear power plants to detect structural defects in the plant’s equipment. Following the testing, Marcial and Ramos helped create and transmit final testing reports to the owners of the plants which, among other things, contained calibration certificates for the equipment used.

Between 2010 and 2021, Marcial was responsible for ensuring that the company’s AE testing equipment was calibrated annually; Ramos worked under Marcial as an engineer. The two men created numerous false calibration certificates for AE testing equipment, and 15 of these false certificates were sent a total of 29 times to nuclear plant owners as part of final testing reports required by the NRC. The falsified calibration certificates were discovered in 2021 during an external audit.

“Today, we hold defendants accountable for deliberately attempting to bypass testing protocols that are essential to keeping nuclear power plants safe,” said Assistant Attorney General Todd Kim of the Justice Department’s Environment and Natural Resources Division (ENRD). “We will continue to use all available enforcement authorities to support NRC’s efforts to ensure that nuclear energy is safely created.”

“Many thanks to the NRC and the ENRD for partnering in enforcement and ensuring the accuracy of inspection reports critical to the safe operation of nuclear power plants,” said U.S. Attorney Jacqueline C. Romero for the Eastern District of Pennsylvania. “My office takes safety matters such as these seriously, and these guilty pleas show that anyone seeking to evade nuclear testing protocols will be held accountable.”

“The NRC takes its mission of protecting public health and safety very seriously,” said Director Thomas G. Ashley Jr. of the NRC’s Office of Investigations. “It’s vital that employees at NRC-regulated entities act with integrity. Today’s announcement shows deliberate violations of NRC requirements will not be tolerated.”

Marcial and Ramos are scheduled to be sentenced on Jan. 25, 2024. Each faces a maximum penalty of five years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

 The NRC’s Office of Investigation conducted the investigation.

Senior Trial Attorney Daniel Dooher and Trial Attorney Rachel M. Roberts of ENRD’s Environmental Crimes Section and Assistant U.S. Attorney Joan E. Burnes for the Eastern District of Pennsylvania are prosecuting the case.

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced today that BioTek reMEDys, Inc. (“BioTek”), located in New Castle, Delaware, and its Chief Executive Officer, Chaitanya Gadde, have agreed to pay $20 million based on BioTek’s ability to pay to resolve allegations that they violated the False Claims Act and the Anti-Kickback Statute by paying kickbacks to patients in the form of routinely waived copayments and to physicians in exchange for providing patient referrals to BioTek.

The government alleged that, from at least August 2015 through May 2020, BioTek, a specialty pharmacy that offers drugs and infusion services, routinely waived the copayments of Medicare and TRICARE patients to induce those patients to purchase its drugs and services. Many of the specialty drugs offered by BioTek were expensive and required patients to pay large copays. Understanding that these copays could deter patients from purchasing its drugs and services, the government alleged that BioTek engaged in a scheme, orchestrated and implemented by Gadde and others, to routinely waive these copays – without regard for whether the patients were experiencing financial hardship – to ensure a steady revenue stream for BioTek.

Today’s settlement also resolves allegations that BioTek provided remuneration in the form of gifts, dinners, and free administrative and clinical support services, to physicians – in particular, Dr. David Tabby, who operated a neurology practice in Bala Cynwyd, Pennsylvania – to induce those physicians to refer patients to BioTek. The government also alleged that Dr. Tabby knowingly solicited and accepted this remuneration in exchange for referring numerous patients to BioTek. Dr. Tabby has paid $480,000 to settle these allegations, based on his ability to pay.

When a Medicare beneficiary obtains a prescription drug covered by Medicare, the beneficiary may be required to make a partial payment, which may take the form of a copayment, coinsurance, or a deductible (collectively “copays”). Congress included copay requirements in the Medicare program in part to serve as a check on health care costs. The Federal Anti-Kickback Statute prohibits the offering, paying, soliciting, or accepting, directly or indirectly, any remuneration – which includes money or any other thing of value – to refer or arrange for the referral of items or services payable by any federal health care program. This prohibition extends to companies that routinely waive the copays of Medicare patients without determination of financial need. The Anti-Kickback Statute also extends to the payment of remuneration to physicians in exchange for patient referrals.

“BioTek allegedly provided improper physician inducements and covered up kickbacks for patient referrals by waiving co-pays,” said United States Attorney Jacqueline C. Romero. “These improper and corrupt business practices will not be tolerated in this District. Biotek’s alleged scheme, orchestrated and implemented by Gadde, Dr. Tabby, and others, to routinely waive these copays – without regard for whether the patients were experiencing financial hardship – ensured a steady revenue stream for BioTek and undermined patient care to citizens of this District. This Office will continue to invest itself in the pursuit of health care providers who violate the law for personal gain.”

“Kickbacks impose hidden costs on the health care system and compromise medical decision-making,” said Maureen R. Dixon, Special Agent in Charge with the U.S. Department of Health and Human Services Office of the Inspector General. “Alongside our law enforcement partners, HHS-OIG is committed to safeguarding the integrity of federal health care programs by, in part, holding individuals who unlawfully bill the programs accountable for their actions."

“The settlement agreement announced today demonstrates our ongoing commitment to work with our law enforcement partners to investigate healthcare fraud and protect TRICARE, the healthcare system for military members and their dependents,” stated Special Agent in Charge Patrick J. Hegarty of the Defense Criminal Investigative Service Northeast Field Office. “When health care companies pay physicians and submit false claims for improper referrals, they undermine the integrity of TRICARE and place an unnecessary financial burden on the program.”

The civil settlement includes the resolution of claims brought under the qui tam or whistleblower provisions of the False Claims Act by Shantae M. Wyatt and Latoya Sparrow, former BioTek employees. Under those provisions, a private party may file an action on behalf of the United States and receive a portion of any recovery. Wyatt and Sparrow will receive $4 million as their share of the settlement with BioTek and Gadde, and $91,200 as their share of the settlement with Dr. Tabby. The qui tam case is captioned United States of America ex rel. Wyatt et al. v. BioTek reMEDys, Inc., No. 19-6069 (E.D. Pa.). The relators are represented by David Bocian, Esq. and Asher Alavi, Esq. of Kessler Topaz Meltzer & Check, LLP.

The resolutions obtained in this matter were the result of a coordinated effort among the Justice Department’s Civil Division, Commercial Litigation Branch, Fraud Section, the United States Attorney’s Office for the Eastern District of Pennsylvania, the United States Attorney’s Office for the District of Delaware, the U.S. Department of Health and Human Services Office of the Inspector General, the Office of Inspector General for the Office of Personnel Management, and the Department of Defense Office of Inspector General, Defense Criminal Investigative Service.

The investigation and resolution of this matter illustrates the government’s emphasis on combating healthcare fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement can be reported to the Department of Health and Human Services, at 800‑HHS‑TIPS (800-447-8477).

The matter was handled in the U.S. Attorney’s Office for the Eastern District of Pennsylvania by United States Attorney Jacqueline C. Romero, Deputy Chief Charlene Keller Fullmer, Assistant United States Attorney Judith Amorosa, and Auditor George Niedzwicki .

The claims asserted by the United States are allegations only and there has been no determination of liability.

PHILADELPHIA– United States Attorney Jacqueline C. Romero announced that the Cigna Group (“Cigna”), a national insurer with corporate offices in Philadelphia, has agreed to pay $172,294,350 to resolve allegations that it violated the civil False Claims Act by submitting and failing to withdraw inaccurate and untruthful diagnosis codes for its Medicare Advantage Plan enrollees in order to increase its payments from Medicare. Of this amount, Cigna will pay $135,294,350 to resolve allegations arising from an investigation based out of the Eastern District of Pennsylvania.

“Given the growth of Medicare Advantage plans, investigating fraud involving Medicare Part C is more important than ever. My office has prioritized combatting Medicare Advantage fraud, including applying data-driven investigative methods and working extensively with our law enforcement partners across the country,” said U.S. Attorney Jacqueline C. Romero of the Eastern District of Pennsylvania. “We will hold accountable those who report unsupported diagnoses to inflate Medicare Advantage payment, such as unsupported diagnosis codes for morbid obesity.” Indeed, earlier this year, this office announced another Medicare Advantage settlement in a different case: https://www.justice.gov/usao-edpa/pr/primary-care-physicians-pay-15-million-resolve-false-claims-act-liability-submitting.

Under the Medicare Advantage (“MA”) Program, also known as Medicare Part C, Medicare beneficiaries have the option of obtaining their Medicare-covered benefits through private insurance plans called MA Plans. Over half of our nation’s Medicare beneficiaries are now enrolled in MA Plans, and the government pays private insurers over $450 billion each year to provide for their care. The Centers for Medicare and Medicaid Services (“CMS”) pays the MA Plans a fixed monthly amount for each beneficiary who enrolls. CMS adjusts these monthly payments to account for various “risk” factors that affect expected health expenditures for the beneficiary, to ensure that MA Plans are paid more for those beneficiaries expected to incur higher healthcare costs and less for healthier beneficiaries expected to incur lower costs. To make these adjustments, CMS collects “risk adjustment” data, including medical diagnosis codes, from the MA Plans.

Cigna owns and operates MA Organizations that offer MA Plans to beneficiaries across the country. The United States alleges that Cigna submitted inaccurate and untruthful patient diagnosis data to CMS in order to inflate the payments it received from CMS, failed to withdraw the inaccurate and untruthful diagnosis data and repay CMS, and falsely certified in writing to CMS that the data was accurate and truthful. The settlement announced today resolves these allegations.

The United States contends that, for payment years 2014 to 2019, Cigna operated a “chart review” program, pursuant to which it retrieved medical records (also known as “charts”) from healthcare providers documenting services they had previously rendered to Medicare beneficiaries enrolled in Cigna’s plans. Cigna retained diagnosis coders to review those charts to identify all medical conditions that the charts supported and to assign the beneficiaries diagnosis codes for those conditions. Cigna relied on the results of those chart reviews to submit additional diagnosis codes to CMS that the healthcare providers had not reported for the beneficiaries to obtain additional payments from CMS. However, Cigna’s chart reviews also did not substantiate some diagnosis codes that were reported by providers and previously submitted by Cigna to CMS. Cigna did not delete or withdraw these inaccurate and untruthful diagnosis codes, however, which would have required Cigna to reimburse CMS. Thus, the United States alleges that Cigna used the results of its chart reviews to identify instances where Cigna could seek additional payments from CMS, while improperly failing to use those same results when they provided information about instances where Cigna was overpaid.

The United States further contends that, for payment years 2016 to 2021, Cigna knowingly submitted and/or failed to delete or withdraw inaccurate and untruthful diagnosis codes for morbid obesity to increase the payments it received from CMS for numerous beneficiaries enrolled in its MA plans. The medical records for individuals diagnosed as morbidly obese typically include one or more Body Mass Index (“BMI”) recordings. Individuals with a BMI below 35 cannot properly be diagnosed as morbidly obese. However, Cigna submitted or failed to delete inaccurate and untruthful diagnosis codes for morbid obesity for individuals lacking a BMI of 35 or above, and these codes increased the payments made by CMS.

In connection with the settlement, Cigna entered into a five-year Corporate Integrity Agreement (“CIA”) with the U.S. Department of Health and Human Services Office of Inspector General (“HHS-OIG”). The CIA requires that Cigna implement numerous accountability and auditing provisions. On an annual basis, top executives and members of the Board of Directors must make certifications about Cigna’s compliance measures, Cigna must conduct annual risk assessments and other monitoring, and an independent review organization will conduct multi-faceted audits focused on risk adjustment data.

“Today’s settlement shows our attention to and commitment in investigating all potential allegations of fraud against the Medicare Part C Program, no matter the complexity of the scheme,” said Maureen R. Dixon, Special Agent in Charge for HHS-OIG, Region III. “We will continue to partner with the United States Attorney’s Office to evaluate allegations brought under the False Claims Act to ensure the integrity of federal healthcare programs.”

The matter was handled in the Eastern District of Pennsylvania by Assistant U.S. Attorneys Deborah W. Frey and Matthew E. K. Howatt, Civil Chief Gregory B. David, auditor George Niedzwicki, and litigative consultants Lauren M. Cordrey and Priscilla Brandon, along with Civil Fraud Section attorney Carol L. Wallack and Assistant Director, Edward C. Crooke. HHS-OIG supported the investigation.

The remaining $37 million of the aggregate settlement amount above resolves allegations related to unsupported diagnoses for MA beneficiaries arising from Cigna’s home visit program. That separate settlement resolves claims brought under the qui tam or whistleblower provisions of the False Claims Act. That case is captioned United States ex rel. Cutler v. Cigna Corp., et al., No. 3:21-cv-00748 (M.D. Tenn.), which case was transferred from the Southern District of New York.

The investigation and resolution of this matter illustrate the government’s emphasis on combating healthcare fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement, can be reported to the Department of Health and Human Services at https://oig.hhs.gov/fraud/report-fraud/ or 800-HHS-TIPS (800-447-8477).

The claims resolved by the settlement are allegations only and there has been no determination of liability.

The Boeing Company, headquartered in Arlington, Virginia, has agreed to pay $8,100,000 to resolve allegations that it violated the False Claims Act by submitting false claims and making false statements in connection with contracts with the U.S. Navy to manufacture the V-22 Osprey, a tiltrotor military aircraft. 

The settlement announced today resolves allegations that from approximately 2007 through 2018, Boeing failed to comply with certain contractual manufacturing specifications in fabricating composite components for the V-22 at its facility in Ridley Park, Pennsylvania. Specifically, the government contends that Boeing failed to perform required monthly testing on autoclaves used in the composite cure process and was not in compliance with additional requirements related to the testing.  

“The government expects contractors to adhere to contractual obligations to which they have agreed and for which they have been paid,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “Today’s settlement demonstrates our commitment to hold accountable contractors who violate such obligations and undermine the integrity of the government’s procurement process.”

“All government contractors have a responsibility to follow the obligations and protocols set forth by their contracts,” said U.S. Attorney Jacqueline C. Romero for the Eastern District of Pennsylvania. “This office is committed to accountability and protection from false claims as shown in cases such as this.”

“Maintaining the integrity of the U.S. Department of Defense (DoD) supply chain is a top priority for the DoD Office of Inspector General’s Defense Criminal Investigative Service (DCIS),” said Special Agent in Charge Patrick J. Hegarty of the DCIS Northeast Field Office. “The DoD expects its contractors to adhere to contract specifications and provide quality products to the U.S. military. We are committed to working with our law enforcement partners to investigate allegations of contractors circumventing required testing protocols and submitting false claims during the DoD procurement process.”

“The integrity of the military procurement process, and ultimately warfighter safety and our national security, demand that our contractors comply strictly with manufacturing requirements, including protocols for equipment testing,” said Special Agent in Charge Greg Gross of the Navy Criminal Investigative Service (NCIS) Economic Crimes Field Office. “NCIS and our partners remain committed to rooting out any noncompliance with manufacturing specifications that threatens warfighter readiness.”

The civil settlement includes the resolution of claims brought under the qui tam or whistleblower provisions of the False Claims Act by former employees of Boeing who worked in composites fabrication and autoclave operations with the V-22 program. Under the qui tam provisions, a private party can file an action on behalf of the United States and receive a portion of any recovery. The qui tam case is captioned U.S. ex rel. Roath et al. v. The Boeing Company, No. 16-cv-6547 (E.D. Pa.). The Relators will receive $1,539,000 in connection with the settlement.

The resolution obtained in this matter was the result of a coordinated effort between the Justice Department’s Civil Division, Commercial Litigation Branch, Fraud Section, and the U.S. Attorney’s Office for the Eastern District of Pennsylvania, with assistance from the DCIS, Naval Criminal Investigative Service, as well as subject matter experts from the Defense Contract Management Agency and the Naval Air Systems Command.

This matter was handled by Trial Attorney Amy Likoff of the Civil Division and Assistant U.S. Attorneys Joel Sweet and David Degnan for the Eastern District of Pennsylvania.

The claims resolved by the settlement are allegations only and there has been no determination of liability.

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced today that a local property owner will pay $90,458 to settle allegations that he violated the False Claims Act by charging a low-income tenant more than the amount permitted under the property owner’s agreement with the government under the Housing Choice Voucher Program (Section 8).

The government alleges that under the Housing Choice Voucher Program, David Krmpotich of Montgomery County was permitted to charge rent in an amount agreed upon by Krmpotich, the tenant, and a public housing agency administering the rent subsidy program. Under the program rules and the parties’ lease, the tenant was required to pay Krmpotich rent equal to a portion of the tenant’s income, and the federal government was required to pay the balance of the agreed total rent. Krmpotich was prohibited from charging the tenant more than the tenant’s allocation of the total rent amount. Nevertheless, the government alleges Krmpotich demanded that the tenant pay an additional $125.00 to $185.00 per month in unlawful and undisclosed supplemental rent payments.

United States Attorney Romero stated, “A deal is a deal. Property owners receiving rent subsidies from government’s coffers must live with the deal they agree to and not secretly and illegally demand more from tenants, whether money or anything else of value. The conduct alleged here is an affront to the integrity of the Housing Choice Voucher Program – a program designed to promote safe and affordable housing for low-income tenants – and to the taxpayers who pay for the program. My office is committed to bring accountability to those who break the rules.”

“This settlement represents our commitment to protecting HUD beneficiaries from bad actors seeking to enrich themselves by preying on HUD-housing participants,” said Special Agent in Charge Shawn Rice of the U.S. Department of Housing and Urban Development, Office of Inspector General. “HUD OIG will continue to pursue and bring to justice landlords who fraudulently overcharge HUD-assisted tenants in violation of Federal law.”

The allegations against Krmpotich were brought to the attention of the United States by a whistleblower. The False Claims Act provides for whistleblowers to receive a portion of the amount recovered because of their disclosures. In this case, the whistleblower will receive $16,282 of the settlement proceeds. 

The government’s investigation was led by Assistant United States Attorney Joel M. Sweet, Investigator Jeffrey Braun, and investigators from HUD OIG. The whistleblower lawsuit is captioned United States ex rel. Catherine Spearman Jackson v. David Krmpotich, No. 22-cv-1613 (E.D. Pa.). 

The claims asserted by the United States are allegations only and there has been no determination of liability.

The Boeing Company will pay $8,100,000 to settle allegations that it violated the False Claims Act by failing to adhere to critical manufacturing specifications in the production of composite parts for V-22 Osprey military aircraft, announced United States Attorney Jacqueline C. Romero.

The allegations against Boeing were brought to light by three whistleblowers who worked at Boeing’s manufacturing facility in Ridley Park, Pennsylvania.

The United States alleges that Boeing falsely certified to the government that it had complied with all manufacturing specifications for the fabrication of certain composite parts for the V-22 Osprey aircraft.

Composite parts for the V-22 Osprey are manufactured using a process that involves curing these parts in autoclaves. The autoclaves are large, precisely controlled chambers that regulate temperature and pressure over the extended period of time required to properly cure composite parts. Every composite part used in the V-22 must be cured at a particular temperature and pressure. The V-22 manufacturing specifications require Boeing to assure the accurate performance of the autoclaves by performing monthly temperature uniformity surveys, among other requirements. Temperature uniformity surveys are intended to verify that an autoclave is performing at expected temperatures or identify when an autoclave deviates from specified temperatures.

The United States contends that Boeing failed to comply with manufacturing specifications for certain V-22 composite parts manufactured at the Ridley Park facility. The government alleges that Boeing failed to conduct routine checks designed to ensure the consistent performance of autoclaves in which composite parts were cured. Specifically, the United States alleges that from 2007 through 2018 Boeing failed to perform monthly temperature uniformity surveys on autoclaves, failed to collect and analyze temperature uniformity survey data on a monthly basis, failed to verify that calibration and certification tags on autoclaves were current, and failed to direct random surveillance of autoclave processes – all in violation of the V-22 manufacturing specifications. The United States further alleges that Boeing failed to use appropriate thermal testing equipment and failed to maintain required documents concerning autoclave testing.

“Taxpayers deserve to get what they pay for, and members of our military deserve to know that no shortcuts have been taken in the manufacture of aircraft and other equipment upon which they depend. My office will continue to investigate vigorously all credible allegations of government contractors cutting corners and submitting false certifications in connection with payments from the Treasury,” said United States Attorney for the Eastern District of Pennsylvania Jacqueline C. Romero.

“Maintaining the integrity of the U.S. Department of Defense supply chain is a top priority for the Office of Inspector General’s Defense Criminal Investigative Service. The Department of Defense expects its contractors to adhere strictly to contract specifications when providing products to the U.S. military,” stated Patrick J. Hegarty, Special Agent in Charge of the Defense Criminal Investigative Service, Northeast Field Office. Hegarty continued: “We are committed to working with our law enforcement partners and the U.S. Attorney’s Office for the Eastern District of Pennsylvania to investigate allegations of contractors circumventing required testing protocols and submitting false claims during the procurement process.”

“The integrity of the military procurement process, and ultimately warfighter safety and our national security, demand that our contractors comply strictly with manufacturing requirements, including protocols for equipment testing,” said Special Agent-in-Charge Greg Gross of the Navy Criminal Investigative Service Economic Crimes Field Office. “NCIS and our partners remain committed to rooting out any noncompliance with manufacturing specifications that threatens warfighter readiness.”

The False Claims Act provides for whistleblowers to receive a portion of the amount recovered because of their disclosures. In this case, the three whistleblowers collectively will receive $1,539,000 of the settlement proceeds.

The government’s investigation was led by Assistant United States Attorneys Joel M. Sweet and David A. Degnan, Auditor Dawn Wiggins, and Investigator Jeffrey Braun, all of the United States Attorney’s Office for the Eastern District of Pennsylvania, along with Trial Attorney Amy Likoff of the U.S. Department of Justice Commercial Litigation Branch, Fraud Section, and Special Agents of the Defense Criminal Investigative Service and the Navy Criminal Investigative Service. The whistleblower lawsuit is captioned United States ex rel. Robert C. Roath, et al. v. The Boeing Company, No. 16-cv-6547 (E.D. Pa.). The whistleblowers are represented by F. Emmett Fitzpatrick, III of Flamm Walton Heimbach and Joseph D. Mancano of Mancano Law, PLLC.

The settlement is not an admission by Boeing that it is liable under the False Claims Act.

PHILADELPHIA, PA – United States Attorney Jacqueline C. Romero and the U.S. Department of Housing and Urban Development’s Inspector General Rae Oliver Davis hosted a Safe Housing Seminar today focused on promoting the health and safety of tenants living in HUD-assisted housing.

The seminar, which took place at the U.S. Attorney’s Office in Philadelphia as part of the HUD Office of Inspector General’s new community outreach initiative, focused on eliminating environmental hazards and combatting sexual misconduct in HUD-assisted housing. The topics included effective safe housing strategies, environmental justice concepts and issues, and how to recognize and report sexual misconduct in housing.

Participants included representatives from organizations who routinely work with vulnerable populations most likely to be impacted by environmental injustices, such as lead paint in their homes, or become victims of sexual harassment in housing by their landlords, property managers, maintenance staff, or other housing personnel in positions of authority. Organizations represented included local law enforcement agencies, legal aid offices, fair housing organizations, shelters, and transitional housing providers. Participants were encouraged to share their experiences, concerns, and expertise to build future partnerships and provide aid and assistance to beneficiaries when reporting matters related to health and safety in housing.

“My office and our investigative partners at HUD OIG are committed to the comprehensive environmental justice strategies aimed at reversing environmental inequities in underserved communities that rely heavily on HUD’s housing assistance programs,” said U.S. Attorney Romero. “Through our longstanding partnership, we will also continue to work together to enforce the Fair Housing Act by investigating and prosecuting discrimination in housing based on race, color, religion, national origin, sex, disability, and familial status. Sexual harassment is a form of sex discrimination prohibited by the Fair Housing Act, and together we will investigate and prosecute offenders taking advantage of tenants and prospective tenants in violation of the law.”

“Environmental justice violations and sexual harassment in housing are egregious violations of a person’s right to safe and fair housing under federal law,” Inspector General Oliver Davis said. “We are working closely with the U.S. Attorney’s Office to spread the word about ways to help victims who currently are experiencing these issues or who have been impacted by them in the past. Outreach events like the one we hosted today are an important way to increase awareness, share information, and build strong partnerships in the community to help call out and eliminate these problems together.”

If you or someone you know has information about environmental hazards and unsafe unit conditions in HUD-assisted housing or has been a victim of sexual harassment, sexual assault, or sexual exploitation—even if the events occurred years ago—report it to the HUD Office of Inspector General Hotline at 1-800-347-3735 or visit the website at www.hudoig.gov/hotline.

You may also contact the U.S. Department of Justice at 1-844-380-6178 or visit www.civilrights.justice.gov. Individuals who believe they may have been victims of environmental injustices or housing discrimination may also contact the U.S. Attorney’s Office at 615 Chestnut Street, Suite 1250, Philadelphia, PA 19106, ATTN: Environmental Justice Coordinator Erin Lindgren, [email protected], or Civil Rights Coordinator Lauren DeBruicker, [email protected].

HUD OIG Sexual Misconduct in Housing Public Service Announcement: www.youtube.com/watch?v=fqXSMjUZIZU

HUD OIG Environmental Justice Public Service Announcement: https://youtu.be/Xk4uExYYph0

DOJ Sexual Harassment in Housing Initiative: www.justice.gov/crt/sexual-harassment-housing-initiative

On behalf of the U.S. Attorney’s Office for the Eastern District of Pennsylvania, I want to express how deeply saddened we are by the death of JoAnne A. Epps, Acting Temple University President. Acting President Epps is fondly remembered as a former Assistant U.S. Attorney from 1980 to 1985. She was an icon in the legal community, dedicating her life to public service, the rule of law, experiential legal education, equity and diversity in the profession, and the advancement of civil rights. She was tireless and passionate about the issues she held dear. We deeply mourn her passing and send our heartfelt condolences to her family in this difficult time.

On a personal note, JoAnne was a mentor and confidante. Today I mourn with countless women who had the pleasure of Joanne’s wise advice, mentorship, and counsel over the years. I am simply devastated by her passing. 

A Pennsylvania man was sentenced today to 25 years in prison for manufacturing and attempting to manufacture child sexual abuse material (CSAM).

According to court documents, David Dunn, 57, of Red Hill, used the mobile applications Snapchat and Likee to coerce and entice a 10-year-old female to engage in sexually explicit conduct. Dunn told the victim he was 11 years old and sent the minor female CSAM depicting minor boys, which he had downloaded from the Dark Web. Dunn captured the CSAM he coerced the victim to create and sent it to another individual via Telegram. Two cell phones seized from Dunn’s home contained thousands of images and videos of CSAM.

Dunn pleaded guilty to one count of sexual exploitation of children. 

Acting Assistant Attorney General Nicole M. Argentieri of the Justice Department’s Criminal Division, U.S. Attorney Jacqueline C. Romero for the Eastern District of Pennsylvania, and Acting Special Agent in Charge Richard Langham of the FBI Philadelphia Field Office made the announcement.

The FBI Philadelphia Field Office investigated the case.

Trial Attorney Kaylynn N. Foulon of the Criminal Division’s Child Exploitation and Obscenity Section and Assistant U.S. Attorney Kevin Jayne for the Eastern District of Pennsylvania prosecuted the case.

This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Child Exploitation and Obscenity Section, 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.justice.gov/psc.

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced today that Navmar Applied Sciences Corporation (NASC), headquartered in Warminster, Pennsylvania, has agreed to pay $4.4 million to resolve allegations that NASC violated the False Claims Act by knowingly and improperly double-billing and shifting certain labor and material costs under a series of contracts with the U.S. Department of the Navy. Separately, NASC has also agreed to resolve administrative claims arising out of an audit by the Defense Contract Audit Agency of NASC’s incurred cost proposals for Fiscal Years 2011, 2012, and 2013.

The United States’ allegations under the False Claims Act arise from a series of contracts, awarded by the Navy to NASC between 2010 and 2012, for enhanced intelligence, surveillance, and reconnaissance systems, hardware, maintenance technical support services, and the development and rapid deployment of various advanced sensors and Unmanned Aerial Systems.

The United States alleged that under those government contracts, NASC knowingly and improperly billed the Navy for certain labor and material costs on one contract, and then billed the same costs on another contract, and was improperly paid twice. The United States further alleged that in multiple instances, NASC knowingly and improperly shifted the costs of materials from one contract to another, to avoid cost ceilings and maximize payments from the government to which NASC was not entitled.

“This settlement demonstrates the Justice Department’s commitment to take appropriate action when it determines that taxpayer dollars have been doubled-billed and improperly accounted for,” said U.S. Attorney Romero. “Cases such as this one should be seen as a warning to defense contractors that false claims have no place in military purchasing.”

“Investigating allegations of cost mischarging on Department of Defense (DoD) contracts is a top priority for the Defense Criminal Investigative Service (DCIS), the law enforcement arm of the DoD Office of Inspector General,” stated Special Agent in Charge Patrick J. Hegarty, DCIS Northeast Field Office. “The DCIS is committed to working with the Naval Criminal Investigative Service and the Department of Justice to protect the integrity of the DoD procurement process. The Defense Contract Audit Agency’s Operations Investigative Support Division provided valuable expertise during this investigation.”

“Procurement fraud threatens military readiness and therefore poses a significant threat to our national security,” said Special Agent in Charge Gregory Gross of the NCIS Economic Crime Field Office. “NCIS remains committed to ensuring the good stewardship of U.S. taxpayer dollars by thoroughly investigating all allegations of fraud that damage the integrity of the Department of the Navy procurement process.”

The resolution obtained in this matter was the result of a coordinated effort between the United States Attorney’s Office for the Eastern District of Pennsylvania, the U.S. Department of Justice Civil Division, Commercial Litigation Branch, Fraud Section, with investigative assistance from the Defense Criminal Investigative Service, the Naval Criminal Investigative Service, the Defense Contract Audit Agency, and the Defense Contract Management Agency.

The matter is being handled in the U.S. Attorney’s Office by Assistant U.S. Attorneys Landon Y. Jones and Mark J. Sherer, and Auditor Dawn Wiggins.

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced that Nicole K. Schuster, 32, of Revere, Massachusetts was charged by Information with disclosing contractor bid, proposal, and source information. Schuster was a mechanical engineer and “project lead” employed by the United States Department of the Navy (“the Navy”) at the Naval Foundry and Propeller Center in Philadelphia, Pennsylvania (the “NFPC”).

According to the Information, in or about early 2019, Schuster began working as the project lead on a solicitation for a procurement contract for a submarine propeller-making machine known as a VTC. During the contracting and bidding process, Schuster favored one company, identified in the information as “Company 1,” over other competing companies. Schuster urged her superiors to make the contract for this VTC a “sole source” contract for Company 1. That is, she requested that the contracting process should be established in a manner that would ensure that Company 1 would be awarded the procurement contract. The NFPC and Defense Logistics Agency agreed to favor Company 1 in this process but did not agree to prevent other companies from pursuing the contract. Rather, they established a process that allowed other contractors to submit information and compete for the contract. 

The information further alleges that on or about September 14, 2019, Schuster sent a WhatsApp message to a representative of Company 1 expressing her “loyalty” to Company 1 and attaching to the message Company 2’s confidential and proprietary contractor bid, proposal, and source selection information for its VTC. The documents that Schuster provided to this representative of Company 1 were marked “SOURCE SELECTION INFORMATION,” “OFFICIAL USE ONLY,” and “[Company 2] Proprietary information.” The documents included cost and pricing data and proprietary information about manufacturing processes and techniques. This disclosure gave Company 1 a competitive advantage over Company 2 and other companies seeking to obtain the VTC contract.  

On or about April 28, 2020, the procurement contract for the VTC was awarded to Company 1 for a total price of $15,254,608.

The case was investigated by the Department of Defense, Office of Inspector General, Defense Criminal Investigative Service and the U.S. Naval Criminal Investigative Service, Economic Crimes Field Office, and is being prosecuted by Assistant United States Attorney Louis D. Lappen.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced that Rooldy Alexandre, 54, of Willingboro, NJ, was sentenced to 24 months of incarceration, three years of supervised release, and restitution in the amount of $662,454 by United States District Judge Gerald J. Pappert for committing pandemic loan fraud in the name of the church for which he served as a pastor and on behalf of other members of the church.

The defendant was charged with, and pleaded guilty to, two counts of wire fraud in connection with his submission of false applications for U.S. Small Business Administration pandemic loans that are also known as Paycheck Protection Program (“PPP”) loans. While he served as the pastor and only employee of a Philadelphia church, the defendant was responsible for the church’s finances and controlled the church’s bank accounts. After the COVID-19 pandemic began, he first applied for a PPP loan using accurate information for the church but was not satisfied with the amount of the loan offered. He then reached out to a person in Florida who had prepared false PPP applications for others and asked that person to help him prepare a new PPP application for the church. The Florida consultant submitted false information about the church in the new application, and based on that false information, the church received an inflated loan of over $260,000. The defendant took a significant portion of the fraudulent loan proceeds for himself. He later submitted a false second-draw PPP loan application on behalf of the church and worked with his sister, Christella Dorval, charged elsewhere, to divert proceeds of the $250,000 loan to himself for personal use.

The defendant also offered to help other members of the church to apply for PPP loans. On behalf of two other members, he submitted loan applications, but he falsified information about the applicants. The defendant lied to the applicants and claimed that a fake Florida consultant had prepared their applications, and that they owed him 25% of any loan proceeds. When the applicants received the inflated loan proceeds based on the information falsely submitted by the defendant, they paid the 25% “consultant” fee, but unbeknownst to them the defendant again worked with his sister, Dorval, to divert their payments to himself for his own personal use.

The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Nancy E. Potts.

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced that Norman D. Wise, 57, of Mullica Hill, NJ, Douglas E. Daniel, 65, of Philadelphia, PA, and Leonard F. Coleman, 53, of Paulsboro, NJ, were charged by Information with bribery and fraud charges related to two schemes: (1) a bribery scheme in which Coleman paid off Wise and Daniel in exchange for contracting work awarded to Coleman at the Chester Housing Authority (“CHA”); and (2) a fraud scheme in which Wise and Daniel created a contracting company that they used to fraudulently bill the CHA and obtain hundreds of thousands of dollars in proceeds. During the time they engaged in these offenses, Wise was the Director of Public Housing for the Chester Housing Authority and Daniel was the Housing Program Manager and Wise’s chief assistant.

According to the Information, from in or about July 2014 through in or about March 2022, defendant Coleman made bribe payments separately to Wise and Daniel in exchange for CHA contracting work awarded to his company, Coleman’s Contracting. To generate these bribe payments, Wise and Daniel inflated the amount charged on invoices that Coleman submitted to the CHA for work he performed for the CHA. Wise and Daniel then ensured that the CHA paid Coleman on the inflated invoices, and Coleman paid Wise and Daniel bribes in amounts covered by the inflated invoices. Coleman made these payments by depositing funds directly into the personal bank accounts of Wise and Daniel. In total, Coleman made approximately $76,400 in bribe payments to Wise and Daniel around the time that Coleman received approximately $2.5 million in revenue from the CHA.

According to the Information, from in or about January 2019 through in or about January 2023, in a separate scheme, Wise and Daniel together used a company they created, Trinity Management Group (“TMG”), to fraudulently bill the CHA for work TMG allegedly performed for the CHA. Most of the work for which TMG billed the CHA was (1) performed by salaried CHA employees during their regular work hours; (2) performed by other contractors who were paid for that work by the CHA; or (3) not performed at all. In particular, the fraudulent invoices included billing for landscaping, painting, window replacements, and other construction and renovation work at CHA facilities. This fraudulent billing resulted in losses to the CHA of approximately $544,967.

The case was investigated by the Federal Bureau of Investigation and the U.S. Department of Housing and Urban Development, Office of Inspector General, and is being prosecuted by Assistant United States Attorney Louis D. Lappen.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

Evoke Neuroscience, Inc., of New York will pay $225,000, and its co-founder/CEO David Hagedorn, Ph.D., of Jacksonville, North Carolina, will pay $220,000, to resolve alleged False Claims Act violations for causing the submission of false claims to Medicare by promoting false billing codes for a “brain health” device. The settlement was announced today by United States Attorney Jacqueline C. Romero of the Eastern District of Pennsylvania.   

Dr. Hagedorn, a psychologist, co-founded Evoke as a startup in approximately 2009. Evoke sold its “eVox” device primarily to general practitioner physicians. The device involves a 20-60 minute in-office application of a helmet with electrodes that purports to test certain brain functions. During Evoke’s initial startup phase, Dr. Hagedorn selected six billing codes for the eVox device.  

The settlement resolves allegations that from January 1, 2013 through May 31, 2021, Evoke and Dr. Hagedorn promoted to health care providers six false billing codes for Medicare reimbursement for the eVox device. By promoting false billing codes to health care providers, Evoke and Dr. Hagedorn caused the providers to submit false claims to Medicare. The United States contends that none of the codes were ever appropriate for the eVox device as applied because the codes generally require a longer testing time, a specialized environment (e.g., soundproof/dark room), and can only be administered by a relevant specialist. Moreover, the United States contends that Evoke and Dr. Hagedorn improperly encouraged health care providers to bill multiple codes for a single application of the eVox device. In 2018, coding consultants informed Evoke that many of the billing codes it was promoting were problematic, after which time Evoke stopped promoting the false codes.  

“There is no ‘startup’ exception under the False Claims Act,” said U.S. Attorney Romero. “You will be held accountable if you knowingly promote false billing codes to others.”   

This settlement resolves claims originally brought by Kevin Vance, M.D., and Angel Vance, R.N., of Madison, Mississippi to whom, among others, Evoke marketed the eVox system. The case was brought under the whistleblower, or qui tam, provisions of the False Claims Act. The Act permits private citizens with knowledge of fraud against the government to bring a lawsuit on behalf of the United States and to share in any recovery. The Vances will receive $89,000 of the settlement proceeds.

The lawsuit is captioned United States ex rel. Dr. Kevin Vance and Angel Vance v. Evoke Neuroscience, Inc., No. 21-452 (E.D. Pa.). The qui tam suit was initially filed in the United States District Court for the Southern District of Mississippi, and was transferred to the Eastern District of Pennsylvania, where the U.S Attorney’s Office had previously settled a False Claims Act case with a local provider involving, among other things, use of eVox: https://www.justice.gov/usao-edpa/pr/neurosurgeon-medical-practice-director-pay-over-1-million-resolve-false-claims-act.

The case was handled by Assistant United States Attorneys Matthew E. K. Howatt and Joel M. Sweet of the United States Attorney’s Office for the Eastern District of Pennsylvania, along with Auditor Dawn Wiggins and Investigator Jeff Braun, and Assistant United States Attorneys Deidre Colson, Jennifer Case, and Civil Chief Angela Williams of the United States Attorney’s Office for the Southern District of Mississippi. The U.S. Department of Health and Human Services Office of the Inspector General supported the investigation.

The government’s pursuit of this matter illustrates the government’s emphasis on combating health care fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement can be reported to the Department of Health and Human Services at 800-HHS-TIPS (800-447-8477) or online at https://oig.hhs.gov/fraud/report-fraud.

All civil claims are allegations only. There has been no determination of civil liability.

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced that Future Pharmacy, Inc. (“Future”) and JJ Pharmacy, Inc. (“JJ”), and their respective owners, Arthur Kilimnik, Alexander Ferman, Mikhail Ferman, Leonard Kilimnik, and Aleksey (Alex) Orlov, have agreed to pay over $3,500,000 to the federal government to resolve allegations that they violated the False Claims Act by billing Medicare for prescription medications that were not actually dispensed. During the period January 1, 2012, to December 31, 2016, these medications included but were not limited to Lidocaine, Lidoderm, Advair Diskus, Nexium, Creon, and Abilify. Future Pharmacy and JJ Pharmacy have also agreed to a five-year federal healthcare exclusion, which will prohibit them from receiving payments from any federally funded health care insurer such as Medicare during the that time. The pharmacies have also surrendered their DEA Certificates of Registration and ceased operations.

As a majority owner of Future Pharmacy and minority owner of JJ Pharmacy, and a pharmacist, the government also contends that Arthur Kilimnik violated the Controlled Substances Act by: (a) failing to maintain complete and accurate records; (b) failing to separate Future Pharmacy’s Schedule II biennial inventory from its Schedule III-V biennial inventory; (c) failing to take appropriate inventory within a two-year period following Future Pharmacy’s last inventory; (d) receiving Schedule II supply from another company, Future Medical, and filling prescriptions generated by Future Medical without proper documentation; and (e) improperly allowing another individual to use Kilimnik’s Controlled Substance Ordering System username and password to order Schedule II controlled substances.

“Pharmacies and pharmacists have a responsibility to serve as gatekeepers of a closed system of prescription drug distribution. That responsibility was allegedly abused for profit here,” said U.S. Attorney Romero.

“Pharmacies are integral partners in patient care, and they are expected to act with integrity,” said Maureen Dixon, Special Agent in Charge of the Philadelphia Regional Office of the Department of Health and Human Services, Office of the Inspector General. “We take allegations of pharmacy fraud seriously, and today’s settlement reflects our commitment to working with our partners to ensure that taxpayer dollars are spent in an appropriate manner – on needed medications, not wasted on fraud and abuse.”

“Pharmacies are entrusted with the proper dispensing and safeguarding of controlled substances in their possession,” said Thomas Hodnett, Special Agent in Charge of the Drug Enforcement Administration’s (DEA) Philadelphia Field Division. “The Controlled Substances Act mandates that pharmacists maintain accurate records and inventories to account for these drugs.”

The settled civil claims are allegations only. There has been no determination of civil liability.

The case was investigated by the U.S. Department of Health and Human Services Office of the Inspector General and the Drug Enforcement Agency. It was handled by Civil Chief Gregory B. David, Assistant U.S. Attorney Deborah W. Frey, and Auditor George Niedzwicki.

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced that Duanne Pierce, 60, of Philadelphia, Pennsylvania was sentenced to 77 months’ imprisonment, 3 years of supervised release, and $606,394.60 in restitution and other penalties by United States District Court Senior Judge Cynthia M. Rufe for conspiring to transport stolen property across state lines and interstate transportation of stolen property.

From May 2018 through February 2020, defendant Duanne Pierce led seven others in a conspiracy to commit 12 retail jewelry store thefts throughout the United States, transporting the stolen jewelry back to Philadelphia after the thefts, where the jewelry was generally resold to stores in the “Jewelers Row” section of the city. Pierce and his crew carried out these thefts all over the country, often committing multiple thefts from different jewelry stores in a single day. This sophisticated approach reduced the likelihood that the crew would be caught because of local law enforcement’s significant challenge in investigating these out-of-state perpetrators. Pierce participated in 11 thefts, and his role was to steal jewelry—including diamond rings and gold chains, often worth several thousand dollars each—from a display case or from the rear, employee-only area of a store, while his co-conspirators “distracted” sales associates. Pierce then resold the stolen jewelry to local jewelers in Philadelphia. The total retail value of the jewelry stolen by Pierce’s crew was approximately $612,670.59.

In March 2022, a federal grand jury returned a 10-count Indictment charging Duanne Pierce and codefendants Charles Tillery, Janel Pierce, Yolanda Fife, David Tillery, Telfa Wills, and Clifton Fleming with conspiracy to transport stolen property across state lines, in violation of 18 U.S.C. § 371 (Count 1), and interstate transportation of stolen property and aiding and abetting, in violation of 18 U.S.C. §§ 2314 and 2 (Counts 2 through 10). In March 2023, Pierce pled guilty to Counts 1 through 10 of the Indictment. Each of Pierce’s codefendants has also pled guilty.

​"Thanks to the excellent work of the FBI and the many local police departments that assisted in this case," said U.S. Attorney Romero, "this prolific interstate robbery ring has been fully dismantled. Duanne Pierce’s sentence is the culmination of excellent cross-country collaboration among federal, state, and local law enforcement agencies."

“Duanne Pierce and his co-defendants were both prolific and strategic in their thefts, sometimes targeting multiple jewelry stores in the same day. Then they’d move on to a different city and do it again, hauling the stolen loot back to Philly to resell,” said Jacqueline Maguire, Special Agent in Charge of the FBI’s Philadelphia Division. “Through the investigative efforts of the FBI and numerous law enforcement partners across the country, this crew has been dismantled and is being held accountable for their crimes. For his leadership role in the conspiracy, Pierce will now spend years in federal prison.”

The case was investigated by the Federal Bureau of Investigation, Lancaster (PA) Police Department, Plantation (FL) Police Department, Greenville (SC) Police Department, Concord (NC) Police Department, Anderson (SC) Police Department, Jackson County (GA) Sheriff’s Office, Knoxville (TN) Police Department, Manchester (CT) Police Department, Howard County (MD) Police Department, Arlington County (VA) Police Department, Indianapolis (IN) Metropolitan Police Department, and Miami Township (OH) Police Department, and is being prosecuted by Assistant United States Attorneys Jessica Rice, Katherine Shulman, and Kevin Jayne.

Philadelphia, PA – United States Attorney Jacqueline C. Romero announced today that Thomas Jefferson University will pay $2.7 million to resolve allegations that it misused and improperly retained federal funds intended to be used for student loans.

The allegations arise from a loan program established by Congress to address the nation’s shortage of primary care physicians. Under the program administered by the U.S. Department of Health and Human Services’ Health Resources and Services Administration (“HRSA”), the government issues a Primary Care Loan award to a medical school to establish a revolving loan account to provide loans on favorable terms to students willing to commit to practicing in primary care for ten years after completing their medical degree (a “PCL Fund”). Under the terms of the program, participating medical schools must loan monies in the PCL Fund to medical students who meet the program’s qualifications. The school is to add any earnings that accrue on the PCL Fund back into the fund, thereby increasing the monies available to lend and expanding the program’s impact. Any monies in the PCL Fund that exceed a school’s PCL Program lending needs must be returned to HRSA annually so they can be made available to students at other medical schools participating in the program.

The settlement resolves allegations that between 2009 and 2016, Jefferson invested nearly all of its PCL Fund with its endowment, and retained the resulting earnings for its own purposes, in violation of loan program terms. Specifically, the settlement resolves allegations that Jefferson improperly invested federal monies expressly intended to be loaned to qualified medical students to finance their medical education, and retained all returns gained from that investment. These actions allegedly violated HRSA student loan program requirements that: (1) program monies be used only for loans to students and program-related expenditures; (2) any excess cash in the PCL Fund (any amount of the monies not actively on loan or projected to be in the near future) be kept in federally insured accounts “whenever possible;” (3) all earnings accrued on the PCL Fund be placed into the fund to be used to further the program’s purpose; and (4) any excess funds not needed for student loans, including any earnings accrued on any idle funds, be returned to HRSA annually.

Jefferson returned approximately $5.6 million of excess cash in the PCL Fund to HRSA in 2017. The settlement announced today resolves claims relating to the earnings Jefferson is alleged to have gained as a result of its investment of the PCL Fund between 2009 and 2016, and its retention of those earnings, in violation of program terms.

 “The Federal financial aid money in the Primary Care Loan program must be used for its intended purpose or returned to the program,” said U.S. Attorney Romero. “When a medical school wrongfully retains Primary Care Loan program funds that exceed its lending needs, it doesn’t just deprive students at other participating schools the opportunity to use that money to finance their educations. It deprives our communities of the very resource the program was implemented by Congress to provide—primary care physicians to keep them healthy and strong. Our office is dedicated to helping HRSA and our other federal partners maintain the integrity of their programs, and to ensure that taxpayer dollars are used for their intended public good and not private investment income.”

“When schools agree to participate in the Primary Care Loan program, they must carefully account for these federal funds to ensure that taxpayer dollars are used for public good. When a school wrongfully keeps these funds from the program, it prevents other recipients from using them to meet the primary care needs of the community,” said Maureen R. Dixon, Special Agent in Charge for the Department of Health and Human Services, Office of Inspector General (HHS-OIG). “We will continue to work with our partners at HRSA and the U.S. Attorney’s Office to investigate allegations relating to any misuse—including wrongful retention—of federal funds.”

“HRSA takes proper management and oversight of financial assistance seriously,” said Cynthia Baugh, HRSA’s Associate Administrator of the Office of Federal Assistance Management and Chief Grants Management Officer. “We appreciate the collaboration with the U.S. Attorney’s Office and will continue to actively work with our law enforcement partners when we identify potential misuse of federal funds.”

The investigation was conducted by the Office of the Inspector General of the U.S. Department of Health and Human Services and the United States Attorney’s Office for the Eastern district of Pennsylvania. The investigation and settlement were handled by Assistant United States Attorney Lauren DeBruicker, Auditor Dawn Wiggins, and Fraud Investigator Jeffrey Braun.

The claims resolved by the settlement are allegations only; there has been no determination of liability.

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced that Kamal Fataliev, 19, of Philadelphia, was arrested and charged by indictment on charges of making false statements to federal agents. Specifically, the indictment alleges that, in May 2023, Fataliev made materially false statements to Federal Bureau of Investigation (“FBI”) special agents who were conducting an international terrorism investigation.

If convicted, the defendant faces a maximum possible sentence of 16 years in prison, three years of supervised release, a $500,000 fine, and a $200 special assessment.

The case was investigated by the FBI and is being prosecuted by Assistant United States Attorney Joseph A. LaBar and Trial Attorney Dmitriy Slavin of the United States Department of Justice, National Security Division, Counterterrorism Section.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced that Donavon Parish, 28, of Hattiesburg, Mississippi, was arrested and charged by indictment on charges of cyberstalking and communicating interstate threats. The federal grand jury made a special finding that the defendant targeted his victims based on their actual and perceived religion.

The indictment alleges that during April and May 2022, the defendant used a Voice over Internet Protocol service to make a series of phone calls to synagogues and Jewish-owned businesses in the Eastern District of Pennsylvania. In these calls, the defendant allegedly spoke to individuals answering the telephone calls on behalf of their respective institutions, at which time he repeatedly referenced the genocide of approximately six million Jewish people during the Holocaust, stating, among other things, “Heil Hitler,” “all Jews must die,” “we will put you in work camps,” “gas the Jews,” and “Hitler should have finished the job.”

If convicted, the defendant faces a maximum possible sentence of 50 years’ imprisonment, three years of supervised release, a $2,500,000 fine, and a $1,000 special assessment.

The case was investigated by the Federal Bureau of Investigation and is being prosecuted by the United States Attorney’s Office for the Eastern District of Pennsylvania and the United States Department of Justice’s National Security Division (Counterterrorism Section), with assistance from the United States Department of Justice’s Civil Rights Division and the United States Attorney’s Office for the Southern District of Mississippi.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

Donavon Parish, 28, of Hattiesburg, Mississippi, was arrested today and charged by indictment for allegedly engaging in cyberstalking and communicating interstate threats. The indictment alleges the defendant targeted his victims based on their actual or perceived religion, that is, the Jewish faith.

According to the indictment, in April and May 2022, the defendant used a voiceover internet protocol service to make a series of phone calls to synagogues and Jewish-owned businesses in the Eastern District of Pennsylvania. In these calls, Parish allegedly spoke to individuals answering the telephone calls on behalf of their respective institutions, at which time he repeatedly referenced the genocide of approximately six million Jewish people during the Holocaust, stating, among other things, “Heil Hitler,” “all Jews must die,” “we will put you in work camps,” “gas the Jews,” and “Hitler should have finished the job.”

If convicted, Parish faces a statutory maximum sentence of 50 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Assistant Attorney General Matthew G. Olsen of the Justice Department’s National Security Division, U.S. Attorney Jacqueline C. Romero for the Eastern District of Pennsylvania and Assistant Director Robert Wells of the FBI’s Counterterrorism Division made the announcement.

The FBI is investigating the case.

The Eastern District of Pennsylvania and National Security Division’s Counterterrorism Section are prosecuting the case, with assistance from the Justice Department’s Civil Rights Division and the U.S. Attorney’s Office for the Southern District of Mississippi.

An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

A federal grand jury in Philadelphia returned a superseding indictment today charging a Pennsylvania man with seven counts of wire fraud, two counts of mail fraud, and three counts of tax evasion. He was previously charged with the wire and mail fraud counts in an indictment unsealed on Jan. 3, 2023.

According to the superseding indictment, John Griffin of Philadelphia was the principal and founder of Second Story Farming, Inc., doing business as Metropolis Farms, a business purportedly involved with developing and manufacturing sustainable vertical farming technologies. Between approximately 2016 to 2018, Griffin allegedly made misrepresentations, promising to provide two entities with the equipment necessary to create indoor vertical farms. In total, both entities allegedly paid Griffin $760,000 to purchase the equipment, yet Griffin allegedly used only a fraction of that money to purchase equipment. The remainder was allegedly used to operate Griffin’s own business and pay his personal expenses.

The superseding indictment further alleges that from 2016 through 2018, Griffin received at least $420,000 in gross income from his work for Second Story Farming and did not report it on his federal tax returns, and allegedly did not to file a personal tax return since at least 2014. Griffin allegedly attempted to evade his income taxes by making personal withdrawals from business bank accounts and transferring funds from business bank accounts to his wife and entities he controlled.

If convicted, Griffin faces a maximum penalty of 20 years in prison for each wire and mail fraud count and 5 years in prison for each of tax evasion count. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and U.S. Attorney Jacqueline C. Romero of the Eastern District of Pennsylvania made the announcement.

IRS-Criminal Investigation, the United States Postal Inspection Service, and the FBI are investigating the case.

Trial Attorney Catriona Coppler of the Tax Division and Assistant U.S. Attorney David Ignall of the Eastern District of Pennsylvania are prosecuting the case.

An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced that Jeffrey D. Martin, 64, of Orlando, FL, was sentenced to 78 months’ imprisonment and five years’ supervised release and fined $50,000 by United States District Court Judge Gerald Pappert for his participation in a conspiracy to artificially inflate the price of penny stock shares and sell them fraudulently to the public. Martin was also ordered to forfeit $3.5 million in ill-gotten gains.

In November 2020, Martin was charged for manipulating the stock of Mainstream Entertainment, Inc., now known as Volt Solar Systems, Inc., Resort Savers, Inc., Axiom Corp., Virtual Medical International, Inc., and Union Bridge Holdings, Ltd. In a “pump and dump” scheme, Martin and his co-conspirators published fraudulent press releases, filed fraudulent securities disclosures with the U.S. Securities and Exchange Commission, and conducted manipulative stock trading to artificially inflate the price of the stock. They then sold their shares at inflated prices, leading Martin to earn more than $989,000 in illicit proceeds from just one of the companies.

The case was investigated by the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorney Paul G. Shapiro. The U.S. Attorney’s Office appreciates the assistance of the U.S. Securities and Exchange Commission and the Financial Industry Regulatory Authority.

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced that Christopher Davis, 32, of Haddon Heights, NJ, was sentenced to 40 months in prison and five years of supervised release and ordered to pay $267,859 in restitution by United States District Court Judge Harvey Bartle III, for unlawfully obtaining and misusing loan proceeds offered through the federal Paycheck Protection Program (“PPP”) and committing tax evasion. 

While operating a property management business out of Broomall, Pennsylvania in 2016, 2017, and 2018, Davis earned hundreds of thousands of dollars. Nonetheless, he willfully failed to file a tax return for each of these years and took actions to evade paying his personal income taxes, such as using approximately $230,000 from his business bank accounts to purchase four automobiles (including a Ferrari, a Range Rover, and a Mercedes Benz) for his personal use and utilizing corporate credit cards to charge over $326,000 in personal expenses, including trips to Italy, Monaco, Great Britain, Spain, France, and Greece.

After this business failed, in May 2020 Davis filed a fraudulent PPP application in the name of one of his companies, seeking a $209,510 loan. In support of this application, Davis falsely claimed that he had 20 employees and paid a monthly salary of approximately $83,000 to these employees. He also submitted false documentation to support these fraudulent claims. As a result, Republic Bank approved Davis’ fraudulent application and issued him the PPP loan. Davis immediately began to spend the proceeds on personal expenses, including a new Tesla.

“PPP funds were meant to help small businesses stay afloat during unprecedented adverse circumstances,” said U.S. Attorney Romero. “In fraudulently obtaining these funds and evading taxes, Davis took advantage of taxpayers and took valuable resources away from businesses and individuals who needed them.”

“Anyone contemplating cheating on their taxes should know that IRS Criminal Investigation Special Agents work tirelessly, year-round, to investigate tax and financial crimes,” said IRS Criminal Investigation Special Agent in Charge Yury Kruty. "The outcome today is due to the dedicated efforts of IRS Criminal Investigation special agents and our law enforcement partners."

“Christopher Davis blatantly defrauded a government program meant to keep businesses and workers afloat during the pandemic, using the money for his own personal expenses,” said Jacqueline Maguire, Special Agent in Charge of the FBI’s Philadelphia Division. “The FBI and our partners will continue to crack down on Covid con artists like Davis and hold them accountable for their actions.”

The case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service and is being prosecuted by Assistant United States Attorney Patrick J. Murray.

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced that Edward Decker, 45, of West Chester, Pennsylvania, was charged by indictment with two counts of abusive sexual contact on an aircraft.

In July 2022, Decker allegedly engaged in sexual contact with a minor on an American Airlines flight, departing San Diego, California, arriving in Philadelphia, Pennsylvania. If convicted, the defendant faces a maximum possible sentence of 5 years in prison, one year of supervised release, a $500,000 fine, and a $200 special assessment.

The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Josh A. Davison.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

A Pennsylvania man was sentenced today to 25 years in prison for trafficking four minors in Philadelphia.

According to court documents, from at least February 2016 to 2017, Andre Felts, 35, of Philadelphia, led a prostitution ring and trafficked at least four minors ranging in age from 15 to 17 years old. Felts kept a significant portion of the money paid to the minor victims and he and others, at his direction, posted advertisements on the internet for commercial sex with the minors, provided transportation to and from sexual encounters, and identified locations for commercial sex acts to occur. His co-defendants, Ryan Keel and Kevin Francis, allowed Felts to use their homes for commercial sex encounters with the minors in exchange for a portion of the proceeds. On one occasion, Felts assaulted a minor victim.

Felts was also sentenced to a lifetime of supervised release.

On May 31, Keel was sentenced to 11 years and three months in prison, followed by 10 years of supervised release. On July 27, 2022, Kevin Francis was sentenced to 10 years in prison, followed by 10 years of supervised release. All three defendants were ordered to jointly pay $235,000 in restitution to the victims as part of their sentences.

Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division, U.S. Attorney Jacqueline C. Romero for the Eastern District of Pennsylvania, and Assistant Director Luis Quesada of the FBI’s Criminal Investigative Division made the announcement.

The FBI investigated the case.

Trial Attorneys Gwendelynn Bills and Jessica Urban of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorneys Alexandra Lastowski and Priya De Souza for the Eastern District of Pennsylvania prosecuted the case.

This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the 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.justice.gov/psc.

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced that William Merlino, 85, of Mays Landing, NJ, was sentenced to thirty-three months in prison and one year of supervised release by United States District Court Judge Gerald A. McHugh for selling misbranded drugs online and obstruction of justice.

The chemical 2,4-Dinitrophenol (“DNP”) has a variety of industrial and commercial uses, such as herbicides, dyes, and wood preservatives. In the 1930s, before federal law required drugs to be proven safe before they were marketed, DNP was used as a weight-loss drug despite significant adverse side effects, including dehydration, cataracts, liver damage, and death. Owing to DNP’s toxicity, the U.S. Food and Drug Administration (“FDA”) has never approved DNP for human consumption.

A year-long investigation by the FDA revealed that Merlino, a retired physician, packaged and sold DNP for human consumption as a weight-loss drug, and that he used Twitter to advertise, eBay to sell, and email to communicate with customers in the U.S., Canada, and the U.K. Merlino operated his online business out of his home from at least November 2017 until March 2019, and earned approximately $54,000 from his sales of DNP to hundreds of customers. A search warrant executed at the defendant's residence recovered bulk DNP, packaging and encapsulating materials, and a pill press.

In December 2019, Merlino was charged with one count of introduction of misbranded drugs into interstate commerce in connection with operating his illegal business, and in August of 2021, while under indictment and awaiting trial on the misbranding charge, he faked a diagnosis of pancreatic cancer in order to avoid trial. Based on forged medical records and doctor’s letters submitted to the court, Merlino’s trial was delayed several months. When the obstruction was discovered in January 2022, he was charged with obstructing justice and detained. 

In August 2022, Merlino was convicted at trial of the misbranding charge, and subsequently pleaded guilty to the obstruction charge in January 2023. During the trial, a witness from the shipping service the defendant used to ship the drug to customers testified that they referred to Merlino among their colleagues as “the yellow man,” owing to the fact that every time he would bring in a package to ship, they would see yellow dust from the chemical on his skin, nails, and clothes. At sentencing, the government presented evidence that a customer in the U.K. died of DNP toxicity after ingesting pills he purchased from Merlino, who knew that DNP was toxic to humans and illegal to market as a drug. 

“Misbranding and selling a toxic chemical not fit for human consumption as a diet drug places the public at grave and obvious risk,” said U.S. Attorney Romero. “The defendant’s deliberate, dangerous, and deceptive conduct in this case was egregious, and resulted in the tragic loss of a life. His faking having cancer to avoid accountability in our justice system only underscores his shocking contempt for the law.”

“Distributing unapproved and potentially toxic drugs under false labeling and in a deliberate attempt to avoid regulatory scrutiny endangers consumers who are in many cases desperate for treatment,” said Special Agent in Charge George A. Scavdis, FDA Office of Criminal Investigations Metro Washington Field Office. “The fact a medical professional was involved makes the situation ever more troubling.  We will continue to pursue and bring to justice those who jeopardize the public health.”

The cases were investigated by the U.S. Food & Drug Administration Office of Criminal Investigations, U. S. Postal Inspection Service, and Homeland Security Investigations (“HSI”) Atlantic City under the HSI Newark office and are being prosecuted by Assistant United States Attorney Joan Burnes.

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced that the U.S. Department of Justice’s Civil Rights Division and the U.S. Attorney’s Office for the Eastern District of Pennsylvania filed a proposed consent order today to resolve allegations that Stroudsburg, Pennsylvania-based ESSA Bank & Trust (ESSA) engaged in a pattern or practice of lending discrimination by “redlining” majority-Black and Hispanic neighborhoods around Philadelphia. 

“Redlining” is an illegal practice in which lenders avoid providing credit services to individuals living in communities of color because of the race, color, or national origin of residents there. The Fair Housing Act (FHA) and the Equal Credit Opportunity Act (ECOA) prohibit financial institutions from discriminating on such bases when providing mortgage lending services. 

The Department began investigating ESSA’s lending practices after receiving a Federal Deposit Insurance Corporation (FDIC) referral. ESSA fully cooperated with the investigation.

The consent order is subject to court approval and was filed, together with the United States’ complaint, in the U.S. District Court for the Eastern District of Pennsylvania. The complaint alleges that:

• From at least 2017 to 2021, and in violation of the FHA and ECOA, ESSA failed to provide mortgage lending services to (and did not serve the credit needs of) majority-Black and Hispanic neighborhoods in and around Philadelphia;
• ESSA inadequately staffed loan officers to cover the Bank’s branches in such neighborhoods; and
• ESSA’s residential lending advertising targeted majority-white areas while avoiding Philadelphia County.  

ESSA worked expeditiously with the Department to resolve these allegations. Under the consent order, ESSA agrees to invest over $3 million to increase credit opportunities in majority-Black and Hispanic neighborhoods in the Bank’s lending area—including within a five-mile radius around ESSA’s Upper Darby and Lansdowne branches, which encompasses West Philadelphia and the City’s Grays Ferry section. Specifically, ESSA will invest in and for residents of those neighborhoods at least:

• $2.92 million in a loan subsidy fund to increase access to home mortgage, home improvement, home refinance, and home equity loans and lines of credit;
• $125,000 on community partnerships to provide services that increase residential mortgage credit access within a five-mile radius of the Upper Darby and Lansdowne branches; and
• $250,000 on advertising, outreach, consumer financial education, and credit counseling to expand the Bank’s services within that radius.

ESSA also agrees: to assess and report on its fair lending program; to train staff on the Bank’s obligations under the consent order; to complete a community credit needs assessment and remedial plan; to maintain a Fair Lending Committee and a Community Development Officer; and to hire two new mortgage loan officers to serve its Upper Darby and Lansdowne branches.

Announced in October 2021, the Department of Justice’s Combatting Redlining Initiative coordinates the efforts of the FDIC and other enforcement agencies to address this persistent form of discrimination. To date, under the Initiative, the Department has announced seven redlining cases and settlements, and secured $87 million in relief for communities of color that have been victims of lending discrimination. This includes last year’s $20 million settlement with Trident Mortgage Company of its alleged redlining in the Philadelphia metropolitan area.

"Accessing the American dream of owning your own home is possible only when there is equality for all in their opportunities to access lending in the residential mortgage markets," said U.S. Attorney Romero. “Redlining in Greater Philadelphia has deep roots; it's led to decades of disinvestment in communities of color. We appreciate ESSA's prompt cooperation with the Department's investigation and their efforts that will aim to infuse lending resources and help build wealth in neighborhoods of color." 

“For too long, residents of communities of color have been unlawfully denied equal access to credit and shut out of economic opportunities,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “When banks engage in redlining, they perpetuate existing patterns of segregation and widen the racial wealth gap in our country. This resolution makes clear our commitment to holding banks and financial institutions accountable for modern-day redlining while ensuring access to fair lending in communities of color.”

The matter is being handled in the Department’s Civil Rights Division by Special Counsel for Fair Lending Varda Hussain and Trial Attorney Audrey Yap, both of the Housing and Civil Enforcement Section, and in the United States Attorney’s Office by Assistant United States Attorney Gerald B. Sullivan.

A copy of the complaint and information about the Department’s fair lending enforcement can be found at www.justice.gov/fairhousing. Individuals may report lending discrimination by calling the Department’s Housing Discrimination Tip Line at 1-833-591-0291, or submitting a report online.

Citizens in the Eastern District of Pennsylvania who believe that they may have been victims of lending discrimination may also contact the U.S. Attorney’s Office for the Eastern District of Pennsylvania at 215-861-8200 or via email at [email protected].

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced that Jose Baez and Jessenia Cordero, a married couple, both of Allentown, PA, were charged by way of complaint with one count of conspiracy to defraud the United States with respect to certain claims, conspiracy to commit aggravated identity theft, and conspiracy to commit mail fraud, all stemming from Baez and Cordero filing fraudulent tax returns and PUA applications with stolen identities. 

The complaint alleges that Baez and Cordero used stolen identities to file at least 316 fraudulent federal tax returns and 168 fraudulent PUA applications. Baez and Cordero filed the false returns with designated tax preparer identification numbers registered under their name. According to the complaint, Baez and Cordero used the corporate alter ego, JB Multiservices, a company owned by Baez, and of which Cordero was an employee, to file the fraudulent returns. The false returns were filed using an IP address registered to Baez at the business's location. Additionally, according to the complaint, at least 674 false returns were filed by the IP address registered to that location by Baez, Cordero, Person 1, and Person 2. As outlined in the complaint, per Internal Revenue Service (IRS) records, the 316 false returns filed by Baez and Cordero requested at least $1.8 million dollars in fraudulent tax refunds. 

As also alleged in the complaint, the IP address registered to Baez at his and Cordero's home was used to file 168 fraudulent PUA applications. After the fraudulent applications were filed, the respective state workforce agency responsible for administering the PUA benefits dispersed funds on the fraudulent PUA applications by mailing PUA debit cards to addresses in Allentown and elsewhere. Over $1.4 million dollars in PUA benefits were withdrawn at ATMs on the cards. PUA debit cards were also issued under Baez and Cordero's names and mailed to an Allentown address. The PUA debit cards issued under the names of Baez and Cordero were often used at ATMs immediately before or after PUA debit cards were issued on other applications filed with stolen identities.

As alleged in the complaint, during a July 6, 2022 search warrant, that was executed pursuant to a federal search warrant issued in the Eastern District of Pennsylvania of Baez and Cordero's home, federal agents recovered lists of identities and documents that were used to file the fraudulent tax returns and PUA applications.

The case was investigated by the Federal Bureau of Investigation's Allentown Resident Agency, the Internal Revenue Service – Criminal Investigation, and the Department of Labor's Office of the Inspector General, and is being prosecuted by Assistant United States Attorneys Timothy M. Lanni and Mary A. Futcher.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA, PA - United States Attorney Jacqueline C. Romero announced her office’s participation in the Department of Justice’s Annual Money Mule Initiative, a national effort to combat money mule fraud schemes.

Money mules are individuals who are recruited by national and international fraud schemes to help with the laundering of fraud proceeds, or to transport goods purchased with fraud proceeds. These individuals are usually recruited online, through dating websites, job recruiting advertisements, or other types of internet solicitations. The money mules are then asked to help move money and goods from the victims to the fraudsters, who are oftentimes located overseas.

Sometimes the money mules are themselves innocent victims who do not realize that they are assisting with criminal activity. Other times, however, the money mules come to realize that what they are doing is wrong and/or illegal. When this happens, the money mules become knowing participants in the fraud schemes they are assisting and are subject to prosecution.

“Identifying and disrupting the work of money mules is critically important, as money mules are integral components of many organized criminal groups, including international fraud rings,” said U.S. Attorney Romero. “We are committed to working with our local, state, and federal law enforcement partners to disrupt money mule networks in an effort to cut off the flow of funds from victims of fraud schemes – often elderly and vulnerable Americans – to transnational criminal organizations.”

“I am pleased to announce today that the United States Postal Inspection Service and the United States Attorney’s Office are taking steps to stem the flow of victim money leaving the United States through the hands of money mules,” said Christopher Nielsen, Inspector in Charge of the Philadelphia Division of the Postal Inspection Service.  “For many years, we as Postal Inspectors have developed various initiatives to combat the flow of illegal proceeds being sent through the mail to foreign countries.  Taking steps to not only educate our customers, but to bring law enforcement action against perpetrators, will stem the flow of financial loss.  These efforts aside, the most effective way to reduce fraud victimization of American citizens is for friends and family to simply look out for one another.  If you become aware that someone close to you sends Postal Money Orders, cash, or gift cards through the mail, or through other shipping services, to foreign countries, take a moment to talk to that person about these activities and notify the Postal Inspection Service if you suspect fraud.  You might help save them from significant financial loss.”

In the last week, the U.S. Attorney’s Office for the Eastern District of Pennsylvania filed three separate civil complaints and civil injunctions against alleged money mules accused of participating in lottery fraud schemes based in Jamaica and Nigeria. Architects of lottery schemes contact potential victims, falsely claim that those victims have won the lottery, and thereby induce the victims to send money to account for taxes and fees purportedly associated with victims’ falsely promised lottery winnings.

In these schemes, money mules play a critical role by receiving victim payments by mail and wire transfer, depositing the payments into their bank accounts, and allowing access to those accounts by individuals in Jamaica engaged in the scheme. The defendants are alleged to have received victim payments by mail or common carrier, deposited the payments into their bank accounts, and then transferred the funds by wire transfer to individuals engaged in the schemes in Jamaica and Nigeria.

Each defendant has agreed to a stipulated consent decree and order of permanent injunction. The stipulated order bans the alleged money mules from directly or indirectly, assisting, facilitating, or participating in any lottery scheme, prize promotion fraud, or any money transmitting business.

The complaints and civil injunction actions (civil action numbers 23-cv-1844, 23-cv-1885, and 23‑cv-1886) were filed in the United States District Court for the Eastern District of Pennsylvania. These cases are being handled by Assistant United States Attorney David A. Degnan. The investigations were conducted by the United States Postal Inspection Service.

Members of the public are reminded to be careful of individuals they meet online. If those individuals ask you to receive or transfer funds or goods, purchase gift cards, or engage in any type of suspicious activity, please report this activity to law enforcement.

To find public education materials, as well as information about how fraudsters use and recruit money mules, please visit www.justice.gov/civil/consumer-protection-branch/money-mule-initiative.

Information about the Department of Justice’s Elder Fraud Initiative is available at www.justice.gov/elderjustice. If you or someone you know is age 60 or older and has been a victim of financial fraud, help is available at the National Elder Fraud Hotline: 1-833-FRAUD-11 (1-833-372-8311).   

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced that Complete Physician Services, Kenneth Wiseman, DO, and Steven Schmidt, DO (collectively, “CPS”), have agreed to pay a total of $1,500,000 plus interest to resolve False Claims Act allegations that they caused the submission of false claims by misrepresenting the severity of illness and services rendered to increase reimbursement from the Medicare Part C (Medicare Advantage) and Part B programs. 

CPS, a primary care physician practice located in Philadelphia, treated patients under the Medicare Advantage program and the Medicare Part B (Medical Insurance) program. The government alleges that CPS caused the submission of false claims for payment to Part C from January 1, 2015, to December 31, 2018, arising from CPS submitting unsupported diagnosis codes, resulting in increased reimbursement to Part C health insurance companies. Specifically, CPS submitted morbid obesity diagnosis codes to Part C where the diagnoses lacked medical support in that patients had a body mass index under 35. The government contends that the diagnosis of morbid obesity in this situation is inappropriate. Further, the government alleges that CPS’s submission of chronic obstructive pulmonary disease (“COPD”) diagnoses were not medically supported or supported by appropriate medical documentation in many instances. As a result of these unsupported diagnoses, CPS substantially increased Part C reimbursement from the Centers for Medicare & Medicaid Services (“CMS”).

The government also alleges that CPS caused the submission of inappropriate claims to the Medicare Part B program that were not supported by medical documentation from January 1, 2015, to December 31, 2018, in order to maximize its reimbursement. Specifically, the government contends that CPS improperly billed Evaluation and Management visits using Current Procedural Terminology Code 99214 without the requisite level and complex medical decision making that this code requires. Further, CPS inappropriately billed physician assistant services “incident to” the professional services of a physician including occasions when the physician was out of the country. Finally, CPS also submitted unsupported billing to CMS for smoking cessation counseling, pulmonary function tests, and unsupported claims for vaccine administration.

“Almost half of Medicare beneficiaries are now enrolled in Medicare Advantage plans. Investigation of credible allegations of fraud impacting it is more important than ever,” said U.S. Attorney Romero. “The Medicare Advantage Program relies on accurate information about its enrollees’ health status, such as whether they really have morbid obesity or COPD. It is imperative that enrollees receive appropriate treatment and that participating providers and health plans receive proper compensation for the services they actually provide. We will hold accountable those who report unsupported diagnoses to inflate Medicare Advantage payment.”

“Today’s settlement shows our attention to and commitment in investigating all potential allegations of fraud against the Medicare Part C Programs, no matter the size of the physician practice, or the complexity of the scheme,” said Maureen R. Dixon, Special Agent in Charge for the U.S. Department of Health and Human Services, Office of the Inspector General. “We will continue to partner with the United States Attorney’s Office to evaluate allegations brought under the False Claims Act to ensure the integrity of Medicare programs.”

This settlement resolved a lawsuit filed under the False Claims Act in the U.S. District Court for the Eastern District of Pennsylvania by former CPS employees captioned United States ex rel. Michael Helzner, D.O., et al. v. Complete Physician Services, LTD, at al., No. 16-cv-5401 (E.D. Pa.). Under the qui tam or whistleblower provisions of the False Claims Act, lawsuits like this one may be brought on behalf of the United States and the relators share in any recovery by the government. The relators were represented in this case by John M. Hanamirian of the Hanamirian Law Firm. “We thank the relators and the relators’ counsel for their contributions. Detecting fraud is much easier when we have the cooperation of whistleblowers like the ones in this case,” said Romero.

This matter was investigated by the U.S. Attorney’s Office for the Eastern District of Pennsylvania, in conjunction with the U.S. Department of Health and Human Services Office of Inspector General. The investigation and settlement were handled by Assistant U.S. Attorney Deborah W. Frey, Civil Division Chief Gregory B. David, and Auditor George Niedzwicki.

The claims resolved by this settlement are allegations only and there has been no determination of liability.

PHILADELPHIA – An indictment was unsealed today charging Complete Business Solutions Group, Inc., doing business as Par Funding, and four of its principals with various crimes, including securities fraud, extortionate collection of credit, tax crimes, perjury, obstruction of justice, witness retaliation, and witness tampering, announced United States Attorney Jacqueline C. Romero.  These principals are Joseph LaForte, 52: Lisa McElhone, 43; Joseph Cole Barleta (“Joe Cole”), 39; and James LaForte, 46.

According to the indictment, from at least 2016 through July 2020, co-conspirators Joseph LaForte, Joe Cole, James LaForte, and others participated in a conspiracy to commit wire fraud and securities fraud in connection with funds that were raised from investors in Par Funding and its affiliates.  Par Funding and these affiliates provided funding to businesses through short-term financing transactions, referred to as merchant cash advances (“MCAs”).  To fund these MCAs, the defendants raised over $500 million from investors.

It is alleged that as part of their fundraising efforts, these defendants and their conspirators caused false and misleading information to be conveyed to investors regarding various issues, including:

• Joseph LaForte’s true name, his role at Par Funding, and his criminal history;
• Par Funding’s underwriting process;
• the diversity of the company’s MCA portfolio;
• Par Funding’s default rate;
• Par Funding’s financial success and profitability;
• the company’s insurance; and
• the defendants’ self-dealing.

For instance, the indictment alleges that although Joseph LaForte operated Par Funding and referred to it as his business, he concealed this ownership and control by using his wife, Lisa McElhone, as his nominee.  Joseph LaForte also used several aliases, such as “Joe Mack,” while working at the company.  It is alleged that Joseph LaForte, Joe Cole, James LaForte, and their conspirators engaged in this deception to conceal Joseph LaForte’s true role as the person operating the company and his significant criminal history from investors.

The indictment also alleges that Joseph LaForte and James LaForte conspired with an individual named Renato “Gino” Gioe to participate in the extortionate collection of credit.  It is alleged that during the course of Par Funding’s operations, these individuals made hostile, threatening, and intimidating communications to Par Funding’s customers in person and over the telephone in order to collect on delinquent MCAs.  For example, the indictment alleges that Joseph LaForte threatened to “blow up” a delinquent customer’s home in May 2019 and asked another delinquent customer in August 2019 whether the customer had heard of “cement shoes.”  In addition, the indictment alleges that in May 2018, James LaForte told one customer that he was a “soldier for the family” who had torched people’s cars and kicked people’s teeth in.

Furthermore, the indictment alleges that Joseph LaForte and Lisa McElhone committed a variety of tax crimes.  For instance, it is alleged that the married couple defrauded the Commonwealth of Pennsylvania out of approximately $1.2 million of state taxes by falsely claiming to be residents of Florida, even though they worked, lived, and spent more than 300 days per year in Pennsylvania.  Furthermore, the indictment alleges that Joseph LaForte and Lisa McElhone worked together to evade the payment of half a million dollars of employment taxes that had been imposed on Joseph LaForte in connection with companies that he had operated in the mid-2000s.  In addition, it is alleged that Joseph LaForte committed tax crimes by failing to report millions of dollars in cash kickbacks that he personally received from a Par Funding customer, and by regularly paying cash wages to Par Funding employees but not withholding taxes from these wages or reporting them to the IRS.

            It is further alleged that Joseph LaForte and Joe Cole each committed perjury twice during depositions in federal lawsuits against Par Funding, making misrepresentations regarding various matters.  For instance, the indictment alleges that Joseph LaForte lied under oath about his knowledge of his wife’s role at Par Funding, Joe Cole’s role at the company, and the company’s default rate.  The indictment alleges that Joe Cole lied under oath about who was on Par Funding’s credit committee (which Joseph LaForte ran) and who ran Par Funding.

Finally, the indictment alleges that Joseph LaForte and James LaForte engaged in obstruction of justice, witness tampering, and retaliation.  Specifically, it is alleged that in late February 2023, on the streets of Center City Philadelphia, James LaForte, with the assistance of and in coordination with Joseph LaForte, physically assaulted counsel for the Receiver for Par Funding in a lawsuit brought by the U.S. Securities and Exchange Commission in the Southern District of Florida.  Moreover, in connection with the same lawsuit, the indictment alleges that Joseph LaForte threatened to cause serious bodily injury to another individual in November 2022.  Lastly, it is alleged that James LaForte made threats of violence to multiple parties in early 2023 in an effort to interfere with the SEC lawsuit, a federal grand jury investigation, and an anticipated federal prosecution, as well as to retaliate against these parties.

If convicted of all counts charged against them, the defendants face the following maximum possible sentences of imprisonment:  Joseph LaForte – 796 years; McElhone – 70 years; Cole– 415 years; and James LaForte – 615 years.  The defendants also face full restitution, a fine, and a period of supervised release and/or probation.

The case was investigated by the Federal Bureau of Investigation, Internal Revenue Service-Criminal Investigations, the Federal Deposit Insurance Corporation-Office of Inspector General, and Pennsylvania State Police and is being prosecuted by Assistant United States Attorneys Patrick J. Murray, Matthew Newcomer, and Alexandra Lastowski.  The SEC in Florida investigated and litigated the civil securities fraud charges which formed the basis of a portion of the criminal prosecution.             

An indictment is an accusation.  A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced that Ardavan Alamoutinia, 33, of Hummelstown, PA, and Aryanah Davison, 23, of Harrisburg, PA, were charged by Indictment with one count of conspiracy to commit wire and mail fraud, ten counts of mail fraud, one count of theft of government money, and eight counts of aggravated identity theft, all stemming from their scheme to fraudulently obtain emergency funds meant for those affected by the COVID-19 pandemic.

The Indictment alleges that Alamoutinia and Davison used stolen identities to file over 500 fraudulent PUA applications. These over 500 fraudulent applications were filed using at least 375 identities of current or former employees of Company 1. A co-conspirator stole these identities from Company 1 and transferred them to Davison.  After receiving the identities, Alamoutinia and Davison filed or caused to be filed the fraudulent PUA applications in 27 different states resulting in a loss of at least $2,886,876.

 According to the Indictment, after the fraudulent applications were filed, the respective state workforce agencies responsible for administering the PUA benefits dispersed funds based upon the fraudulent PUA applications either by direct deposits or mailing checks and PUA debit cards. Defendants then cashed the checks, deposited the checks, received the direct deposits into bank accounts controlled by them, and collected and possessed the PUA debit card issued on the applications. Defendants also made direct expenditures using the PUA debit cards, withdrew the money from those cards at ATMs, and transferred the money to financial accounts controlled by them.

The Indictment also alleges that Alamoutinia and Davison converted at least $2,500,000 of the fraudulent proceeds in this case. Alamoutinia and Davison spent the fraudulent proceeds, in part, on hundreds of thousands of dollars in cryptocurrency purchases and on a luxury sports vehicle.  

The case was investigated by the Department of Labor – Office of Inspector General, Department of Homeland Security – Office of Inspector General, United States Postal Inspection Service, National Aeronautics and Space Administration – Office of Inspector General, and the Social Security Administration – Office of Inspector General, and is being prosecuted by Assistant United States Attorney Timothy Lanni.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced that Samirah Boksmati, 34, was sentenced to three months’ imprisonment, three years of supervised release, and a $700 assessment by United States District Judge R. Barclay Surrick for four counts of making false statements in a passport application and three counts of using a passport secured by false statements.

Boksmati made multiple false representations to the U.S. State Department to secure United States passports for herself and her children and then used those passports obtained by fraud to travel abroad with two of her minor children. Boksmati acted with the intent to take all three of her children out of the United States, despite a family court order prohibiting her from taking her eldest child out of the country.

“Border and identification security are critically important to national security,” said U.S. Attorney Romero. “Obtaining a United States passport by fraud will not be tolerated, especially when that fraud is perpetrated in order to take a child out of the country in violation of a family court order. This sentence demonstrates that there are consequences to abusing the passport application process.”

“One of the core missions of Diplomatic Security Service (DSS) is to protect the integrity of U.S. travel documents, which includes preventing the fraudulent acquisition and use of U.S. passports to facilitate parental child abductions,” Resident Agent in Charge R. Mike Escott of the U.S. Department of State's Diplomatic Security Service Philadelphia Resident Office. “DSS is grateful for today’s outcome and for the close partnership and support of the FBI and the U.S. Attorney’s Office.”

The case was investigated by the U.S. Department of State - Diplomatic Security Service and is being prosecuted by Assistant United States Attorney Josh A. Davison.

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced that Douglas Daniel Files, D.O., has agreed to pay $100,000 to resolve allegations that he violated the Controlled Substances Act (CSA) by failing to maintain complete and accurate records of a controlled substance (testosterone), failing to keep required receipt and dispensing records, failing to perform biennial inventories, and writing prescriptions “for stock.”

The United States’ investigation involved Files’ practice located at 2346 Trenton Road, Levittown, Pennsylvania 19056.

As part of the settlement, Files has entered into a three-year Memorandum of Agreement (MOA) with the Drug Enforcement Administration (DEA), which includes additional responsibilities regarding the handling of controlled substances. The MOA imposes compliance obligations significantly more stringent than those in the applicable laws and regulations.

Files prescribes and administers testosterone, a Schedule IIIN controlled substance.  In April 2022, DEA investigators discovered that Files allegedly failed to conduct a biennial inventory, failed to maintain records for receipt and dispensing of the controlled substance, and was prescribing controlled substances “for stock” – all in violation of applicable regulations and statutes. 

The DEA diversion investigators obtained records of Files’ prescriptions “for stock” from a local retail pharmacy.  Physicians are prohibited from obtaining controlled substances for the purpose of general dispensing to patients; they must comply with the requirements for a valid prescription, including the date, patient’s name and address, drug name and strength, dosage form, quantity prescribed, directions for use, and the physician/registrant’s name, address, and registration number.  The prescription requirement is one of the ways in which controlled substances are tracked to prevent diversion and abuse.

“Physicians who fail to maintain proper records of controlled substances create conditions ripe for diversion, or, at worst, may be engaging in diversion itself,” said U.S. Attorney Romero. “Physicians and pharmacists have a responsibility to ensure that all controlled substances are tracked through the distribution chain.  Our Office is committed to ensuring total compliance with the Controlled Substances Act and we will vigorously enforce violations wherever we find them.”

“Dr. Files’ ordering of prescription medicines for stock is not permissible under the regulations of the Controlled Substances Act,” said Thomas Hodnett, Special Agent in Charge of the Drug Enforcement Administration’s Philadelphia Field Division.  “Settlements and Memorandum of Agreements such as these help to ensure that physicians properly safeguard, dispense, and account for the controlled substances in their care.”

Congress enacted the CSA to deter the illegal importation, manufacture, distribution, possession, and improper use of controlled substances, including prescription medications, and requires individuals and entities registered with the DEA to maintain complete and accurate records of all controlled substances and security systems so that controlled substances are not lost, stolen, or inappropriately dispensed.

The government’s pursuit of this matter illustrates its emphasis on combating diversion of controlled substances.  The record keeping and other regulations applicable to DEA registrants, including physicians, are the tools by which the DEA deters drug diversion. 

The investigation was conducted by the Drug Enforcement Administration’s Philadelphia Field Division, Diversion Regulatory Group 2 (D72), and the investigation and settlement were handled by Assistant U.S. Attorney Viveca D. Parker, with DEA Diversion Investigators.   

The claims resolved by this settlement are allegations only and there has been no determination of liability.

CONTRACT KILLER SENTENCED TO FIVE CONSECUTIVE LIFE SENTENCES IN PRISON FOR COMMITTING SIX MURDERS AND ONE ATTEMPTED MURDER

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced that Ernest Pressley, 43, of Philadelphia, Pennsylvania, was sentenced to five consecutive life sentences by United States District Judge Eduardo C. Robreno on one count of conspiracy to commit murder-for-hire and four counts of use of interstate commerce facilities in the commission of murder-for-hire, in connection with Pressley's role in murdering four victims in Philadelphia between 2017 and 2018, all in exchange for money. Pressley's conduct also included his role in the killing of two other victims in 2016 and 2017 and the attempted murder of a woman in 2018. 

In late 2018, the Philadelphia Police Department joined with the Federal Bureau of Investigation to investigate Pressley in connection with the murder of S.S., who was shot to death in the parking lot of a Philadelphia apartment complex near 7400 Malvern Avenue in the early morning hours of September 1, 2018. Pressley was captured on video surveillance footage near the scene and in footage retrieved from a bar in Philadelphia the evening before when he was with S.S. and several other men. Pressley was arrested in connection with this crime on September 7, 2018.

Law enforcement's investigation revealed that Pressley was responsible for other murders in Philadelphia, including the killings of two tow truck drivers for A. Bob's Towing on January 12 and 13, 2017.  Pressley agreed to kill tow truck driver K.F. in exchange for money to prevent K.F. from testifying as a witness at an assault trial in Philadelphia. In an effort to distract law enforcement from the true motivation for K.F.'s murder and to make it appear as though it was connected to a feud between rival tow truck companies, Pressley selected at random one of K.F.'s co-workers, E.R., and shot him to death as he left work on January 12, 2017, near 4500 Melrose Street. The next day, Pressley approached K.F. as he left his home and entered his tow truck, which was being driven by a co-worker, at which time Pressley opened fire, fatally striking K.F. and injuring his co-worker, who was shot several times in his lower body.  

As the investigation developed further, Pressley was also identified as the person who shot M.R. to death in Philadelphia on January 11, 2017, near the intersection of East Sharpnack and Baldwin Streets, while M.R. worked on his vehicle at a garage in the area. 

In September 2022, during his guilty plea allocution before Judge Robreno, Pressley admitted that he murdered M.R., E.R., K.F., and S.S. in exchange for money and at the direction of a drug trafficker. Around the time of each crime, Pressley used his cellular phone to communicate with his co-conspirator to plan how and when each murder would be carried out. 

Pressley also admitted to shooting C.Y. to death on July 19, 2016, as C.Y. sat on the porch of a residence near 1500 West Olney Avenue in Philadelphia. Pressley also admitted to his role in providing the location of a man he knew was wanted dead by a Philadelphia drug trafficker, which later resulted in the death of Y.H., who was killed as the result of mistaken identity near the intersection of 56th Street and Ithan Street on July 24, 2018. Finally, Pressley admitted that he attempted to kill a woman when he shot her in the arm as she arrived at her Philadelphia home on North Woodstock Street on July 9, 2018. While the woman survived a gunshot wound, she later discovered that her home had been ransacked and several items, including money and jewelry, were stolen. Several hours later, Pressley was identified as having sold a Rolex watch belonging to the woman at a Philadelphia pawn shop. 

"Taking a cold-blooded killer like Ernest Pressley off the street for five consecutive life sentences is a prime example of why the U.S. Attorney's Office and the Department of Justice make tackling violent crime a priority,” said  U.S. Attorney Romero. "Our joint partnerships with the FBI and Philadelphia Police Department make it possible to bring these cases into federal court and secure the severe punishment such a career murderer deserves.”

“Ernest Pressley is a hardened and chronic offender, a true menace to society,” said Jacqueline Maguire, Special Agent in Charge of the FBI’s Philadelphia Division. “For all the lives he took and families he affected, this contract killer has duly earned each of his life sentences. The FBI and Philadelphia Police Department will continue to focus our partnership and resources on locking up the worst of the worst, like Pressley, who cause so much of the city’s bloodshed.”

"This defendant ultimately failed to escape accountability for his outrageous violent crimes due to the collaboration of law enforcement at all levels of government, which occurs each and every day," Philadelphia District Attorney Larry Krasner said. "I commend U.S. Attorney Romero and her team, the FBI, Philadelphia Police, along with our own ADA Joanne Pescatore, Supervisor of the Homicide/Non-Fatal Shootings Unit, for helping to secure a sentence of incarceration that ensures Ernest Pressley will no longer endanger our communities."

"We are grateful for the collaboration between the Philadelphia Police Department, the Federal Bureau of Investigation, and the U.S. Attorney’s Office, which led to the apprehension and conviction of Ernest Pressley,” said Philadelphia Police Commissioner Danielle Outlaw. “His heinous crimes demonstrate the utmost disregard for human life. This sentence sends a strong message that we will relentlessly pursue justice and protect our communities from those who commit acts of violence."        

The case was investigated by the Federal Bureau of Investigation, the Philadelphia Police Department, and the Philadelphia District Attorney’s Office, and is being prosecuted by Assistant United States Attorney Justin Ashenfelter.

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced that Craig Alex Levin, 67, of King of Prussia was sentenced to 35 years in prison and a lifetime of supervised release by United States District Court Judge Harvey Bartle, III for for traveling to the Philippines to engage in sex with children as young as 12 years old.

According to court documents, between 2016 and 2019, Levin was a retired special education teacher who traveled to the Philippines nine times, each time for the purpose of engaging in sex with disadvantaged minors who, by Levin’s own words, were hungry or needed money for medicine for family members. In May 2019, the Philippines National Police arrested Levin as he was about to enter the elevator at his hotel with a 15-year-old girl. Upon search of his hotel room, police located several notebooks containing the names and ages of hundreds of girls, scored on a rating system of 1 to 10 in five categories: Face, Body, Sex, Personality, Age. Only girls under the age of 18 received a top score of 10. There were multiple children as young as 12 listed in the notebooks.

"At the time of Levin's arrest in the Philippines, he was escorting a 15-year-old girl to his hotel room. Levin's sentencing effectively takes a dangerous predator who targeted vulnerable children in a foreign country off the streets indefinitely," said U.S. Attorney Romero. "No matter their role in society or where they prey on children, child sex offenders must be held accountable."

“This predator with a passport traveled halfway around the world, multiple times a year, solely to sexually abuse children,” said Jacqueline Maguire, Special Agent in Charge of the FBI’s Philadelphia Division. “He took eager advantage of situations of extreme poverty to gain access to the young girls he victimized, apparently thinking he’d just continue to fly under the radar. This lengthy sentence proves him wrong, and should send a message to anyone else sexually exploiting children: whether you commit your crimes here at home or travel to do so abroad, the FBI will investigate, hold you accountable, and ensure your destination is federal prison.”

This case is 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 Criminal Division’s Child Exploitation and Obscenity Section, 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 http://www.justice.gov/psc.

The case was investigated by the FBI and Philippine National Police and Women and Children Protection Center - Visayas Field Unit. It is being prosecuted by Assistant United States Attorney Michelle Rotella and Trial Attorney Austin M. Berry of the Criminal Division’s Child Exploitation and Obscenity Section.

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced that Terrence Livorsi, 68, of Glenside, Pennsylvania, pleaded guilty to charges of conspiracy to commit health care fraud arising from his operation of his company’s Employee Assistance Program (“EAP”) . Livorsi  used the EAP to funnel patients to addiction treatment at facilities and programs that he  owned in Florida in order to fraudulently bill patients’ medical insurance for treatment that was not medically necessary.

Livorsi offered his company’s EAP services free of charge and marketed its services mainly to public sector labor unions in New Jersey. Livorsi and his EAP encouraged union officials and representatives to call when a union member was in distress or facing workplace discipline. Upon referral of a union member for EAP services, Livorsi and/or an employee of the EAP collected information from the person, including asking the prospective patient about his or her use of alcohol or drugs. Many prospective patients did not have substance use disorders but were nevertheless fraudulently referred to Recovery Institute of South Florida (“RISF”), a substance use treatment facility that Livorsi also owned and operated. Patients were pressured to fly to Florida immediately for treatment at RISF, allegedly to save their jobs. The people that Livorsi and his staff members referred to RISF were not told that Livorsi owned RISF or that he would benefit financially by billing their health insurance.

From at least January 2014 until RISF closed in April 2018, it was the business of Livorsi’s EAP to send patients to treatment RISF. RISF depended on the EAP to refer patients for treatment, and made money by billing insurers for those referred patients. The EAP, which did not charge anyone for its services, depended on RISF to finance its operations. As the sole owner of both RISF and the EAP, Livorsi controlled every aspect of their operations, including the finances and bank accounts of both organizations. Livorsi directly profited when RISF profited. Livorsi directed RISF to pay bonuses to his staff, including himself, for admissions to RISF that the employee had procured. Although he was not a licensed caregiver and was infrequently present at RISF, Livorsi exercised control over when patients could be discharged from RISF, and would keep patients as long as possible to maximize the opportunities to bill insurance.

"Livorsi's guilty plea should send a clear message to those seeking to build their financial empire off the despair of individuals battling addiction by committing health care fraud," said U.S. Attorney Jacqueline C. Romero. “The defendant's actions were illegal and unconscionable. Moreover, healthcare fraud impacts all of us by raising costs and compromising quality.”

“Over the course of years, Terrence Livorsi defrauded insurers of big money by using patients as pawns,” said Jacqueline Maguire, Special Agent in Charge of the FBI’s Philadelphia Division. “He had no compunction about referring all of these people to his own faraway treatment facility, some of whom didn’t even have substance abuse issues. Health care fraud is a costly, consequential federal crime and the FBI will continue to make these investigations a priority as we work to deter such criminal behavior.”

Livorsi was charged by Information filed April 11, 2023, and entered a plea of guilty on May 8, 2023. A sentencing hearing is scheduled for September 6, 2023 at 10:00 a.m.

The cases were investigated by the Philadelphia FBI Healthcare Fraud Task Force, which includes agents from the Pennsylvania Attorney General's Office and the Philadelphia Police Department, and the Employee Benefit Security Administration of the United States Department of Labor, and is being prosecuted by Assistant United States Attorney Elizabeth Abrams.

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced that brothers Zumar Dubose, age 34, of Atlantic City, NJ; Abdush Dubose, age 36, of Boynton Beach, FL; and Kariem Dubose, age 42, of Philadelphia, PA, were convicted today at trial of mail fraud, wire fraud, bank fraud, and money laundering conspiracy charges arising from their scheme to defraud and obtain money from the United States Postal Service, UPS and Citizens Bank.

Starting as early as October 2018, in less than one year, the defendants submitted over 1,200 fraudulent insured-parcel claims with the United States Postal Service and UPS, and received almost $300,000 in ill-gotten gains. As part of the scheme, the Dubose brothers sent parcels themselves containing items of no value using insured United States Postal Service postage and UPS tracking labels. They then filed fraudulent claims with United States Postal Service and UPS, claiming that these parcels which had contained nothing of value were lost or damaged in transit, and attached sham proofs of value. The defendants used numerous e-mails, addresses and postboxes, bank accounts and bank cards, fake individual names, and fictitious corporations, including “Urmajesty Banktruckfit Solutions,” “Miworld Three Incorporated,” and “4 Entertainment Corporation,” which were incorporated in the State of New Jersey, and “Seeds of Beauty Incorporated,” which was incorporated in the State of Florida. The claim checks that the brothers received as part of this fraud scheme were deposited into Citizens Bank accounts opened in the names of these fake companies through ATMs in Philadelphia, Pennsylvania, and elsewhere.

When USPS and UPS refused to issue or deliver some of the fraudulently-obtained claim checks, and when Citizens Bank placed a hold on a bank account that was used to deposit the fraud proceeds, the Dubose brothers were undeterred. The brothers repeatedly contacted the United States Postal Service and UPS using fake names; defendant Zumar Dubose even filed lawsuits against UPS in various counties in New Jersey, using fake plaintiff names and falsely claiming that UPS did not pay him funds that he was owed. The defendants also filed lawsuits against Citizens Bank, again pretending to be a different individual, in an effort to obtain the funds from their fraud scheme.

"Lying about insured parcels and then turning around and filing lawsuits against the victim companies, when those companies suspected something was awry is brazen, to say the least," said U.S. Attorney Romero. "Today's guilty verdicts against the Dubose brothers show the commitment of our office and law enforcement partners to investigate and prosecute this type of flagrant fraud."

One of the investigative missions of the U.S. Postal Service Office of Inspector General (OIG) is to help safeguard the Postal Service and U.S. Mail from being utilized for illegal activity. OIG Special Agents vigorously investigate these cases in partnership with our law enforcement partners,” said Special Agent-in-Charge Jeffery Krafels. “These guilty verdicts should serve as a reminder and deterrent to anyone thinking this type of behavior is acceptable.”

The case was investigated by the United States Postal Service Office of the Inspector General and the United States Postal Inspection Service, and is being prosecuted by Assistant United States Attorneys Louis D. Lappen and J. Jeanette Kang. UPS and Citizens Bank provided crucial cooperation in this investigation.

A Pennsylvania man was sentenced today to 35 years in prison for traveling to the Philippines to engage in sex with children as young as 12 years old.

According to court documents, between 2016 and 2019, Craig Alex Levin, 67, of King of Prussia, was a retired special education teacher who traveled to the Philippines nine times, each time for the purpose of engaging in sex with disadvantaged minors who, by Levin’s own words, were hungry or needed money for medicine for family members. In May 2019, the Philippine National Police arrested Levin as he was about to enter the elevator at his hotel with a 15-year-old girl. Upon search of his hotel room, police located several notebooks containing the names and ages of hundreds of girls, whom he rated based on several categories, including age. Only girls under the age of 18 received a top score of 10. There were multiple children as young as 12 listed in the notebooks.

In June 2022, Levin pleaded guilty to six counts charging him with foreign travel to engage in sex with a minor, attempted sex trafficking of a minor, and distribution and transportation of child pornography. 

Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division, U.S. Attorney Jacqueline C. Romero for the Eastern District of Pennsylvania, and Assistant Director Luis Quesada of the FBI’s Criminal Investigative Division made the announcement.

The FBI and Philippine National Police investigated the case.

Trial Attorney Austin M. Berry of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Michelle Rotella for the Eastern District of Pennsylvania prosecuted the case. The Justice Department’s Office of International Affairs assisted with securing evidence from the Philippines, including through mutual legal assistance requests.

This case is 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.justice.gov/psc.

United States Attorney for the Eastern District of Pennsylvania, Jacqueline C. Romero, announced today that the United States has filed a complaint in U.S. District Court under the False Claims Act against Dr. James McGuckin of Radnor, PA, an interventional radiologist, and his affiliated practices and management entities. In its complaint, the United States alleges that McGuckin and his entities billed Medicare and the Federal Employees Health Benefits Program for medically unnecessary invasive peripheral artery procedures in patients’ legs between at least January 1, 2016 and December 31, 2019, and for which McGuckin and his entities were reimbursed at least $6.5 million for over 500 claims. The practice-entity defendants are: (1) Peripheral Vascular Institute of Philadelphia, LLC; (2) Main Line Vascular Institute LLC, of King of Prussia, PA; (3) Lehigh Valley Vascular Institute, LLC, of Bethlehem, PA; and (4) PA Vascular Institute, LLC, of East Stroudsburg, PA. The management-company defendants are Philadelphia Vascular Institute, LLC, and Pennsylvania Vascular Institute, P.C.

“Performing medically unnecessary procedures puts patients at risk and contributes to the soaring costs of health care, especially the invasive vascular procedures alleged in this case,” said U.S. Attorney Romero. “As this litigation demonstrates, we are committed to safeguarding federal health care program beneficiaries and protecting public funds.”

“Medicare rules are designed to protect beneficiaries and taxpayer dollars,” said Maureen R. Dixon, Special Agent in Charge of the Philadelphia Regional Office of the Inspector General, Department of Health and Human Services. “HHS-OIG and the U.S. Attorney's Office will continue to work together to fight health care fraud and investigate allegations of co-pay and kickback violations.”  SAC Dixon added: “Anyone with information about health care fraud in this or other cases should contact the HHS-OIG hotline at 1-800-HHS-TIPS (1-800-447-8477) or online at https://oig.hhs.gov/fraud/report-fraud.”

The allegations regarding unnecessary vascular procedures are described in detail in the complaint and include unnecessary angioplasty, atherectomy, and the placement of stents, as well as the indiscriminate use of intravenous ultrasound. Each procedure requires puncturing the skin and inserting devices into and through the arteries in patients’ legs. As the relevant standards of care indicate, unnecessary invasive vascular procedures may cause harm to patients’ health, including increasing their likelihood of needing future procedures, and putting them at greater risk of leg amputations.

As alleged, Dr. McGuckin and Defendants knew from prior administrative sanctioning that unnecessary procedures are contrary to standards of care and federal law. First, in 2015, pursuant to a Consent Decree, McGuckin was sanctioned by the Washington [State] Medical Quality Insurance Commission—and subsequently several other states’ medical boards and Medicaid programs, including Pennsylvania—for improperly performing unnecessary, experimental vascular procedures, including angioplasty and stenting, on hundreds of patients for the purported treatment of Multiple Sclerosis—a non-vascular disease.

Second, in 2018, McGuckin signed a False Claims Act settlement as manager/owner of Vascular Access Centers, L.P. (“VAC”) and related entities, which resolved multi-million dollar qui tam lawsuits in the Southern District of New York and Eastern District of Louisiana. In the settlement, McGuckin, on behalf of his entities, admitted that his entities regularly scheduled, performed, and billed for vascular procedures “even though the patients presented without any documented evidence that they exhibited a need for therapies.” More information on those prior settlements is available here: https://www.justice.gov/usao-sdny/pr/manhattan-us-attorney-announces-settlement-fraudulent-billing-claims-against-vascular; https://www.justice.gov/usao-edla/pr/vascular-access-centers-pay-least-3825-million-resolve-false-claims-act-allegations.  

Additionally, in 2019, McGuckin caused VAC to file for bankruptcy in this District—a filing that  Bankruptcy Judge Ashely M. Chan found was orchestrated in bad faith. Judge Chan found that McGuckin’s misconduct in connection with the VAC bankruptcy, including making false statements to the Court on behalf of Philadelphia Vascular Institute, LLC, subjected him to sanctions by the Court. See, e.g., In re Vascular Access Centers, L.P., 611 B.R. 742 (Bankr. E.D. Pa 2000), appeal pending.  

The current False Claims Act case is captioned United States of America ex rel. Aaron Shiloh, M.D., FSIR v. Philadelphia Vascular Institute and James McGuckin, M.D., Case No. 18-5458 (E.D. Pa.). This lawsuit was originally filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private parties (called relators) to sue on behalf of the government when they discover evidence that defendants have submitted false claims for government funds and to receive a share of any recovery. If the United States proves that a defendant has knowingly submitted false claims, it is entitled to recover three times the damage that resulted plus a penalty of $13,508 to $27,018 per claim. The False Claims Act also permits the government to intervene in such lawsuits, as it did when it filed a notice of intervention in this case on February 28, 2023.

The relator, Dr. Aaron Shiloh, is an interventional radiologist who worked for and with Defendants. “We sincerely thank the relator in this case. Without people like Dr. Shiloh being willing to shed light on allegations of fraud, preserving government program funds would be far more challenging,” said U.S. Attorney Romero.

The case has been investigated by the U.S. Department of Health and Human Services Office of the Inspector General. The case is being handled by Assistant U.S. Attorneys Lauren DeBruicker and Matthew E. K. Howatt, as well as Auditor Dawn Wiggins and Investigator Frank O’Connor.

All civil claims are allegations only.  There has been no determination of civil liability.

PHILADELPHIA – United States Jacqueline C. Romero announced that Bien King, 70, of Congers, NY and Khalil King, 36, of New York, NY were charged by indictment with conspiracy, distribution of unregistered and misbranded pesticides, and interstate shipment of misbranded animal drugs.

The indictment alleges that Bien King and her son, Khalil King, jointly operated a business called “Little City Dogs,” based in New York City. The defendants purchased unapproved animal drugs and pesticides, including ivermectin, nitenpyram, praziquantel, and fipronil, from various Chinese suppliers. The defendants’ Chinese suppliers routinely mislabeled the shipments to avoid inspection by United States Customs and Border Protection inspectors. According to the indictment, once the defendants received the shipments from China, they used various locations, including a Manhattan office, to mix and repackage these drugs and pesticides for resale to customers throughout the United States. According to the indictment, the defendants’ company received over $4,000,000 from the sale of these misbranded, unregistered, and unapproved pesticides and animal drugs.

If convicted, the defendants face a maximum possible sentence of 19 years in prison, up to 3 years of supervised release, a $1,450,000 fine, and a $550 special assessment.

The case was investigated by the Food and Drug Administration’s Office of Criminal Investigations, the Environmental Protection Agency’s Office of Criminal Investigations, and is being prosecuted by Assistant United States Attorney Christopher E. Parisi.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced that David L. Shull, 68, of Largo, FL (formerly of West Chester, PA) was charged by Indictment with six counts of failure to pay over employment taxes for a Chester County adult day care facility from 2013 through 2017, and failing to account for employment taxes owed in the same years.

The Indictment alleges that, as the Controller/Chief Financial Officer of the care facility, Shull was legally obligated to withhold payroll taxes from wages paid to the company’s employees and was responsible to pay over these taxes to the IRS.  The Indictment also alleges that Shull was required to pay over the care facility’s contributions for Social Security and Medicare in amounts matching the amounts withheld from its employees’ pay for those purposes.  Shull was also required to file, following the end of each calendar quarter, an Employer’s Quarterly Federal Income Tax Return (Form 941), setting forth the total amount of wages and other compensation subject to withholding, the total amount of income tax withheld, and the total amount of Social Security and Medicare taxes due to the IRS. The Indictment alleges that from 2005 through 2017, Shull caused the care facility to pay wages to its employees. The Indictment further alleges that during this same period, Shull also caused the care facility to withhold trust fund taxes from those wages and to issue Wage and Tax Statements (Form W-2) to the employees indicating that trust fund taxes had been withheld from those wages and implying that those trust fund taxes had been paid over to the IRS. The Indictment alleges that beginning in or about 2013 through in or about 2017, this was a false representation, as the withheld tax amounts were not paid over to the IRS, neither were the care facility’s employer contributions paid over during this time period. According to the Indictment, Shull caused some amounts to be paid to the IRS in 2013 and 2014, but this was insufficient to cover tax debts and penalties.

The Indictment further alleges that from 2013 through 2017, Shull caused the care facility to file only one Form 941, for the second quarter of 2013, despite the fact that during this period, the care facility had approximately 53-67 employees.

 If convicted, the defendant faces a maximum possible sentence of 30 years in prison and a $1,500,000 fine. The defendant may also be responsible for the taxes due, in addition to the payment of penalties to the Internal Revenue Service.

The case was investigated by the Internal Revenue Service, and is being prosecuted by Assistant United States Attorney Angella Middleton.